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HomeMy WebLinkAbout03-538 DiPeitroJohn Adam DiPietro Attorney at Law 500 Fayette Street, Suite 300 Conshohocken, PA 19428 Re: Conflict; Public Official /Employee; Borough; Chief of Police; Immediate Family Member; Spouse; Business With Which Associated; Towing Contract. Dear Mr. DiPietro: ADVICE OF COUNSEL April 9, 2003 03 -538 This responds to your letter of March 3, 2003, by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Ha.GS. § 1101 et seq., would present any prohibitions or restrictions upon a borough police chief with regard to contracting between the borough and a towing company owned and operated by the police chief's spouse. Facts: As Solicitor for the Borough of Conshohocken ("Borough"), you seek an advisory on behalf of James Dougherty, the Borough Police Chief. You have submitted facts that may be fairly summarized as follows. You state that the Borough Council wishes to secure the towing services of two local companies relative to accidents and abandoned vehicles. You have submitted a copy of a document entitled "Request For Proposals and Letters of Interest Regarding Towing Contract Services" by which Borough Council solicited proposals, sealed bids and resumes for the towing work, which document is incorporated herein by reference. Per the Request, the deadline for submitting proposals, sealed bids and resumes was June 3, 2002. Only two responses were received, copies of which have been submitted. One proposal was from "Janeway Construction Company, Inc.," a corporation owned and operated by Police Chief Dougherty's spouse. You ask whether Police Chief Dougherty would have a conflict of interest under the Ethics Act if his spouse's company would contract with the Borough to provide towing services. You note that the choice of towers would be made by Borough Council, not by Police Chief Dougherty. Your further state that Police Chief Dougherty would have no involvement whatsoever with towing issues. DiPietro, 03 -538 April 9, 2003 Page 2 You state that with certain exceptions, current policy requires the officer responding to an accident to accommodate any expressed preference of the vehicle owner as to the towing company to be used. In other scenarios, the officer contacts the designated tower. It would appear from the submitted facts that until now, there has been only one designated tower. Now, with the prospect of two designated towers including Janeway Construction Company, Inc., it is anticipated that a sergeant would be designated as administrator and coordinator for towing to deal with both companies as well as any issues that would arise. The sergeant would answer directly to the Mayor and Borough Manager, "sidestepping" Police Chief Dougherty. It is not clear from the submitted facts whether Borough Council or Police Chief Dougherty would designate the sergeant. It is also not clear whether the officers who would continue to report to Police Chief Dougherty would have any role in choosing between the two designated towers. The towers' responsibilities would be outlined in a contract between Borough Council and the towing companies. The arrangement would not involve payment by the Borough of any monies to the towing companies; rather, each company would pay an administrative referral fee to the Borough for each specific tow. You note that in 2002 the Borough received referral fees from the current towing company totaling approximately $3,400. Finally, it is noted that you have submitted copies of legal memoranda from various sources addressing conflict of interest issues as to Police Chief Dougherty. Discussion: It is initially noted that pursuant to Sections 1107(10) and 1107(11) of the Ethics Act, 65 Pa.C.S. §§ 1107(10), (11), advisories are issued to the requestor based upon the facts which the requestor has submitted. In issuing the advisory based upon the facts which the requestor has submitted, the Commission does not engage in an independent investigation of the facts, nor does it speculate as to facts which have not been submitted. It is the burden of the requestor to truthfully disclose all of the material facts relevant to the inquiry. 65 Pa.C.S. §§ 1107(10), (11). An advisory only affords a defense to the extent the requestor has truthfully disclosed all of the material facts. It is further initially noted that, pursuant to the same aforesaid Sections of the Ethics Act, an opinion /advice may be given only as to prospective (future) conduct. If the activity in question has already occurred, the Commission may not issue an opinion /advice but any person may then submit a signed and sworn complaint, which will be investigated by the Commission if there are allegations of Ethics Act violations by a person who is subject to the Ethics Act. To the extent you have inquired as to conduct that has already occurred, such past conduct may not be addressed in the context of an advisory opinion. However, to the extent you have inquired as to future conduct, your inquiry may, and shall be addressed. As Chief of Police for the Borough, James Dougherty ( "Police Chief Dougherty ") is a public employee subject to the provisions of the Ethics Act. See, 65 Pa.C.S. § 1102; 51 Pa. Code § 11.1; Smythe, Orders 733, 1121, 1122; Taylor, Order 906; Wilmot, Order 715. Section 1103(a) of the Ethics Act provides: § 1103. Restricted activities (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. DiPietro, 03 -538 April 9, 2003 Page 3 65 Pa.C.S. § 1103(a). The following terms are defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary loenefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. "Authority of office or employment." The actual power provided by law, the exercise of which is necessary to the performance of duties and responsibilities unique to a particular public office or position of public employment. "Immediate family." A parent, spouse, child, brother or sister. "Business." Any corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self - employed individual, holding company, stock company, receivership, trust or any legal entity organized for profit. "Business with which he is associated " Any business in which the person or a member of the person's immediate family is a director, officer, owner, employee or has a financial interest. "Contract." An agreement or arrangement for the acquisition, use or disposal by the Commonwealth or a political subdivision of consulting or other services or of supplies, materials, equipment, land or other personal or real property. The term shall not mean an agreement or arrangement between the State or political subdivision as one party and a public official or public employee as the other party, concerning his expense, reimbursement, salary, wage, retirement or other benefit, tenure or other matters in consideration of his current public employment with the Commonwealth or a political subdivision. 65 Pa.C.S. § 1102. In addition, Sections 1103(b) and 1103(c) of the Ethics Act provide in part that no person shall offer to a public official /employee anything of monetary value and no public official /employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgment of the public official /employee DiPietro, 03 -538 April 9, 2003 Page 4 would be influenced thereby. Reference is made to these provisions of the law not to imply that there has been or will be any transgression thereof but merely to provide a complete response to the question presented. Section 1103(f) of the Ethics Act provides as follows: § 1103. Restricted activities (f) Contract. - -No public official or public employee or his spouse or child or any business in which the person or his spouse or child is associated shall enter into any contract valued at $500 or more with the governmental body with which the public official or public employee is associated or any subcontract valued at $500 or more with any person who has been awarded a contract with the governmental body with which the public official or public employee is associated, unless the contract has been awarded through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded. In such a case, the public official or public employee shall not have any supervisory or overall responsibility for the implementation or administration of the contract. Any contract or subcontract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of the making of the contract or subcontract. 65 Pa.C.S. § 1103(f). Section 1103(f) does not operate to make contracting with the governmental body permissible where it is otherwise prohibited. Rather, where a public official /public employee, his spouse or child, or a business with which he, his spouse or child is associated, is otherwise appropriately contracting with the governmental body, or subcontracting with any person who has been awarded a contract with the governmental body, in an amount of $500.00 or more, Section 1103(f) requires that an open and public process" be observed as to the contract with the governmental body. Pursuant to Section 1103(f), an "open and public process" includes: (1) prior public notice of the employment or contracting possibility; (2) sufficient time for a reasonable and prudent competitor /applicant to be able to prepare and present an application or proposal; (3) public disclosure of all applications or proposals considered; and (4) public disclosure of the contract awarded and offered and accepted. Section 1103(f) of the Ethics Act also requires that the public official /employee may not have any supervisory or overall responsibility as to the implementation or administration of the contract with the governmental body. Section 1103(j) of the Ethics Act provides as follows: § 1103. Restricted activities (j) Voting conflict. - -Where voting conflicts are not otherwise addressed by the Constitution of Pennsylvania or by any law, rule, regulation, order or ordinance, the following DiPietro, 03 -538 April 9, 2003 Page 5 procedure shall be employed. Any public official or public employee who in the discharge of his official duties would be required to vote on a matter that would result in a conflict of interest shall abstain from voting and, prior to the vote being taken, publicly announce and disclose the nature of his interest as a public record in a written memorandum filed with the person responsible for recording the minutes of the meeting at which the vote is taken, provided that whenever a governing body would be unable to take any action on a matter before it because the number of members of the body required to abstain from voting under the provisions of this section makes the majority or other legally required vote of approval unattainable, then such members shall be permitted to vote if disclosures are made as otherwise provided herein. In the case of a three - member governing body of a political subdivision, where one member has abstained from voting as a result of a conflict of interest and the remaining two members of the governing body have cast opposing votes, the member who has abstained shall be permitted to vote to break the tie vote if disclosure is made as otherwise provided herein. 65 Pa.C.S. § 1103(j). In each instance of a conflict, Section 1103(j) requires the public official/ employee to abstain and to publicly disclose the abstention and reasons for same, both orally and by filing a written memorandum to that effect with the person recording the minutes or supervisor. In the event that the required abstention results in the inability of the governmental body to take action because a majority is unattainable due to the abstention(s) from conflict under the Ethics Act, then voting is permissible provided the disclosure requirements noted above are followed. See, Mlakar, Advice 91- 523 -S. In applying the above provisions of the Ethics Act to your inquiry, you are advised that pursuant to Section 1103(a) of the Ethics Act, a public official /public employee is prohibited from using the authority of public office /employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official /public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. In each instance of a conflict of interest, the public official /public employee must abstain from participation in his public capacity. The abstention requirement is not limited merely to voting, but extends to any use of authority of office. In Juliante, Order 809, the Commission recognized that the use of authority of office as defined in the Ethics Act includes, for example, discussing, conferring with others, and lobbying for a particular result. It is clear that Police Chief Dougherty's spouse is a member of his immediate family, and that Janeway Construction Company, Inc. is a business with which the spouse as owner is associated. Therefore, pursuant to Section 1103(a) of the Ethics Act, Police Chief Dougherty would generally have a conflict of interest in matters involving a towing contract between the Borough and his wife's company. Factually, you have stated that Police Chief Dougherty would have no vote as to the selection of towing companies and no involvement whatsoever with towing issues. A sergeant would be designated as administrator and coordinator for towing to deal with both towing companies as well as any issues that may arise. The sergeant would DiPietro, 03 -538 April 9, 2003 Page 6 answer directly to the Mayor and Borough Manager, "sidestepping" Police Chief Dougherty. However, it is not clear from the submitted facts whether the Mayor, Borough Manager, Borough Council or Police Chief Dougherty would designate the aforesaid sergeant. In the absence of a pre- existing mechanism in place specifying how and by whom Police Chief Dougherty's authority is to be exercised in the event of a conflict, Police Chief Dougherty would be prohibited under Section 1103(a) of the Ethics Act from participating in designating a sergeant to act in his stead as to matters involving the towing contract between the Borough and his wife's company. Cf., Confidential Opinion, 02 -004. It is also not clear from the submitted facts whether the police officers who would continue to report to Police Chief Dougherty would have any role in choosing between the two designated towers. To the extent that police officers reporting to Police Chief Dougherty would play such a role, a conflict would exist for Police Chief Dougherty based upon the State Ethics Commission's rulings in Bassi, Opinion 86- 007 -R, Woodrin , Opinion 90 -001, and Elisco, Opinion 00 -003. Thebasis for the conflict would e Police Chief Dougherty wed exercise authority over such officers as to their employment with the Borough, while the officers would exercise authority over whether to direct business to Police Chief Dougherty's spouse's company. For the reasons enunciated in Bassi, Woodrinq, and Elisco, supra, such a reciprocal arrangement would result in a conft lic of interest for Police Chief Dougherty under Section 1103(a) of the Ethics Act. Further, where Section 1103(f) applies, its requirements must be strictly observed. Under the facts that you have submitted, the governmental body with which Police Chief Dougherty would be associated would be the Borough. Accordingly, a contract between Janeway Construction Company, Inc., a business with which Police Chief Dougherty's spouse is associated, and the Borough, if valued at $500 or more, would trigger the applicability of the restrictions of Section 1103(f). It is noted that in the instant matter, there is an issue as to the value of the contract. Is the "value of the contract" the value to Janeway Construction Company, Inc. based upon revenue generated or the value to the Borough based upon referral fees received from Janeway Construction Company, Inc.? The issue need not be resolved because in either case, based uppon f ast experience, the value would be expected to exceed $500 such that Section 1103(f) would be expected to apply. To the extent the proposed contract between the Borough and Janeway Construction Company, Inc. would be valued at $500 or more, the requirements of Section 1103(f) of the Ethics Act would be applicable. The propriety of the proposed conduct has only been addressed under the Ethics Act; the applicability of any other statute, code, ordinance, regulation or other code of conduct other than the Ethics Act has not been considered in that they do not involve an interpretation of the Ethics Act. Specifically not addressed herein is the applicability of the Borough Code. Conclusion: As Chief of Police for the Borough of Conshohocken ( "Borough "), James Dougherty ( "Police Chief Dougherty ") is a public employee subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. Police Chief Dougherty's spouse is a member of his immediate family. Janeway Construction Company, Inc. is a business with which Police Chief Dougherty s spouse as owner is associated. Police Chief Dougherty would generally have a conflict of interest in matters involving a towing contract between the Borough and his wife's company. In the absence of a pre - existing mechanism in place specifying how and by whom Police Chief Dougherty's authority is to be exercised in the event of a conflict, DiPietro, 03 -538 April 9, 2003 Page 7 Police Chief Dougherty would be prohibited under Section 1103(a) of the Ethics Act from participating in designating a sergeant to act in his stead as to matters involving the towing contract between the Borough and his wife's company. To the extent that police officers reporting to Police Chief Dougherty would play a role in choosing between designated towers including Janeway Construction Company, Inc., a conflict would exist for Police Chief Dougherty under Section 1103(a) of the Ethics Act. To the extent the proposed contract between the Borough and Janeway Construction Company, Inc. would be valued at $500 or more, the requirements of Section 1103(f) of the Ethics Act would be applicable. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Pursuant to Section 1107(11), an Advice is a complete defense in any enforcement proceeding initiated by the Commission, and evidence of good faith conduct in any other civil or criminal proceeding, provided the requestor has disclosed truthfully all the material facts and committed the acts complained of in reliance on the Advice given. This letter is a public record and will be made available as such. Finally, if you disagree with this Advice or if you have any reason to challenge same, you may appeal the Advice to the full Commission. A personal appearance before the Commission will be scheduled and a formal Opinion will be issued by the Commission. Any such appeal must be in writing and must be actually received at the Commission within thirty (30) days of the date of this Advice pursuant to 51 Pa. Code § 13.2(h). The appeal may be received at the Commission by hand delivery, United States mail, delivery service, or by FAX transmission (717-787-0806). Failure to file such an appeal at the Commission within thirty (30) days may result in the dismissal of the appeal. Sincerely, Vincent J. Dopko Chief Counsel