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HomeMy WebLinkAbout23-513 ConfidentialPHONE: 717-783-1610 TOLL FREE: 1-800-932-0936 To the Requester: STATE ETHICS COMMISSION FINANCE BUILDING 613 NORTH STREET, ROOM 309 HARRISBURG, PA 17120-0400 FACSIMILE: 717-787-0806 WEBSITE: www.ethics.pa.gov ADVICE OF COUNSEL March 6, 2023 23-513 This responds to your letter dated January 25, 2023, received February 7, 2023, by which you requested a confidential advisory from the Pennsylvania State Ethics Commission ("Commission"), seeking guidance as to the general issue presented below: Issue: Whether, pursuant to Section 1103(a) of the Public Official and Employee Ethics Act ("Ethics Act"), 65 Pa.C.S. § 1103(a), an individual would have a conflict of interest in his capacity as the [Political Subdivision 1] [Position] or in his capacity as a Member of the [Governing Body] of [Political Subdivision 2] with regard to participating in matters pertaining to [Political Subdivision 1's] [Funding] of [Political Subdivision 2] or other issues involving the relationship between [Political Subdivision 1] and [Political Subdivision 2]. Brief Answer: As to each of the individual's public capacities that is, as the [Political Subdivision 1 ] [Position] or as a Member of the [Political Subdivision 2] [Governing Body] the individual would not have a conflict of interest and would not violate Section 1103(a) of the Ethics Act by participating in matters pertaining to [Political Subdivision 1's] [Funding] of [Political Subdivision 2] or other issues involving the relationship between [Political Subdivision 1] and [Political Subdivision 2] unless: (1) the individual would be consciously aware of a private pecuniary (financial) benefit for himself, a member of his immediate family, or a business with which he or a member of his immediate family is associated; (2) the individual's action(s) would constitute one or more specific steps to attain that benefit; and (3) neither of the statutory exclusions to the definition of Confidential Advice, 23-513 March 6, 2023 Page 2 "conflict" or "conflict of interest" as set forth in the Ethics Act, 65 Pa.C.S. § 1102, would be applicable.' Facts: You have been authorized by [the Individual] to request a confidential advisory from the Commission on his behalf. You have submitted facts that may be fairly summarized as follows. [The Individual] was appointed as the [Political Subdivision 1] [Position] effective [Date]. Prior to being appointed as the [Political Subdivision 1] [Position], [the Individual] served as the [Political Subdivision 1] [Officer]. As the [Political Subdivision 1] [Position], [the Individual] assists in the supervision of the [Political Subdivision 1] [Office] and makes budget recommendations to the [Political Subdivision 1] [Governing Body] as part of the annual budget approval process. [The Individual] is a Member of the [Political Subdivision 2] [Governing Body]. [The Individual's] term of office as a Member of the [Political Subdivision 2] [Governing Body] expires on [Date]. [The Individual] was appointed to the [Political Subdivision 2] [Governing Body] by the [Political Subdivision 1] [Governing Body]. On [Date], [Political Subdivision 1] assumed [Funding] of [Political Subdivision 2]. As [Political Subdivision 2's] primary [Source of Funds], [Political Subdivision 1] makes an annual financial contribution, which will total [Amount] in [Year]. [Political Subdivision 2] also receives [Type of Funding] from [Political Subdivision 3]. The [Political Subdivision 1] [Governing Body] approves [Political Subdivision 3's] [Type of Funding] projects. Based upon the above submitted facts, you pose the following questions: (1) Whether [the Individual's] new role as the [Political Subdivision 1] [Position] would cause him to have a conflict of interest with respect to remaining on the [Political Subdivision 2] [Governing Body]; (2) Whether the Ethics Act would require [the Individual], in his capacity as the [Political Subdivision 1 ] [Position], to abstain from all [Political Subdivision 1 ] budget discussions pertaining to [Political Subdivision 2]; (3) Whether the Ethics Act would require [the Individual], in his capacity as a Member of the [Political Subdivision 2] [Governing Body], to abstain from all discussions involving funding requests or funding appropriations from [Political Subdivision 1]; and (4) Whether the Ethics Act would require [the Individual], in his capacity as a Member of the [Political Subdivision 2] [Governing Body], to abstain from all nonfinancial discussions involving [Political Subdivision 1]. ' Action that has a de minimis (insignificant) economic impact or that 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, does not constitute a conflict of interest. Confidential Advice, 23-513 March 6, 2023 Page 3 Discussion: Pursuant to Sections 1107(10) and 1107(11) of the Ethics Act, 65 Pa.C.S. §§ 1107(10), (11), advisories are issued to the requester based upon the facts that the requester has submitted. An advisory opinion only affords a defense to the extent the requester has truthfully disclosed all material facts. In issuing an advisory opinion, the Commission does not engage in an independent investigation of the facts, nor does it speculate as to acts that have not been submitted. It is the burden of the requester to truthfully disclose all material facts relevant to the inquiry. 65 Pa.C.S. §§ 1107(10), (11). Sections 1103(a) and 11030) of the Ethics Act provide: § 1103. Restricted activities (a) Conflict of interest. -- No public official or public employee shall engage in conduct that constitutes a conflict of interest. 0) 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 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(a), 0). The following terms are defined in the Ethics Act as follows: § 1102. Definitions Confidential Advice, 23-513 March 6, 2023 Page 4 "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 benefit 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. "Political subdivision." Any county, city, borough, incorporated town, township, school district, vocational school, county institution district, and any authority, entity or body organized by the aforementioned. 65 Pa.C.S. § 1102. Subject to the statutory exclusions to the Ethics Act's definition of the term "conflict" or "conflict of interest" (i.e., the de minimis exclusion and the class/subclass exclusion), 65 Pa.C.S. § 1102, a public official/public employee is prohibited from using the authority of public office or confidential information received by holding such a public position for the private pecuniary (financial) 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. The use of authority of office is not limited merely to voting but extends to any use of authority of office including, but not limited to, discussing, conferring with others, and lobbying for a particular result. Juliante, Order 809. In each instance of a conflict of interest, a public official/public employee would be required to abstain from participation, which would include voting unless one of the statutory exceptions of Section 11030) of the Ethics Act would be applicable. Additionally, the disclosure requirements of Section 11030) of the Ethics Act would have to be satisfied in the event of a voting conflict. Per the Pennsylvania Supreme Court's decision in Kistler v. State Ethics Commission, 610 Pa. 516, 22 A.3d 223 (2011), in order to violate Section 1103(a) of the Ethics Act, a public official/public employee: Confidential Advice, 23-513 March 6, 2023 Page 5 ... must act in such a way as to put his [office/public position] to the purpose of obtaining for himself a private pecuniary benefit. Such directed action implies awareness on the part of the [public official/public employee] of the potential pecuniary benefit as well as the motivation to obtain that benefit for himself. Kistler, supra, 610 Pa. at 523, 22 A.3d at 227. To violate Section 1103(a) of the Ethics Act, a public official/public employee "must be consciously aware of a private pecuniary benefit for himself, his family, or his business, and then must take action in the form of one or more specific steps to attain that benefit." Id., 610 Pa. at 528, 22 A.3d at 231. Conclusion: In applying the above provisions of the Ethics Act to the instant matter, you are advised as follows. As the [Political Subdivision 11 [Position], [the Individual] is a public official/public employee subject to the provisions of the Ethics Act. [Political Subdivision 2] is a "political subdivision" as that term is defined by the Ethics Act. Cf., [Cite]. Accordingly, as a Member of the [Political Subdivision 2] [Governing Body], [the Individual] also is a public official subject to the provisions of the Ethics Act. [The Individual's] new role as the [Political Subdivision 1] [Position] would not cause him to have a conflict of interest with respect to remaining on the [Political Subdivision 2] [Governing Body]. [The Individual] would not have a conflict of interest under Section 1103(a) of the Ethics Act as the [Political Subdivision 1] [Position] or as a Member of the [Political Subdivision 2] [Governing Body] in matters that would financially impact [Political Subdivision 1] or [Political Subdivision 2] but that would not financially impact him, a member of his immediate family, or a business with which he or a member of his immediate family is associated. A pecuniary benefit flowing solely to a political subdivision such as [Political Subdivision 1] or [Political Subdivision 2] would not form the basis for a conflict of interest under Section 1103(a) of the Ethics Act. See, Confidential Opinion, 01-005; McCarrier/Anderson, Opinion 98-008; Warso, Order 974. Therefore, as to each of [the Individual's] public capacities that is, as the [Political Subdivision 1] [Position] or as a Member of the [Political Subdivision 2] [Governing Body] [the Individual] would not have a conflict of interest and would not violate Section 1103(a) of the Ethics Act by participating in matters pertaining to [Political Subdivision 1's] relationship with [Political Subdivision 2] (such as [Political Subdivision 1] budget discussions pertaining to [Political Subdivision 2], discussions of the [Political Subdivision 2] [Governing Body] involving funding requests or funding appropriations of [Political Subdivision I], or nonfinancial discussions of the [Political Subdivision 2] [Governing Body] involving [Political Subdivision 1]) unless: (1) [the Individual] would be consciously aware of a private pecuniary (financial) benefit for himself, a member of his immediate family, or a business with which the individual or a member of his immediate family is associated; (2) [the Individual's] action(s) would constitute one or more specific steps to attain that benefit; and (3) neither of the statutory exclusions to the definition of Confidential Advice, 23-513 March 6, 2023 Page 6 "conflict" or "conflict of interest" as set forth in the Ethics Act, 65 Pa.C.S. § 1102, would be applicable. In each instance of a conflict of interest, [the Individual] would be required to abstain from participation, which would include voting unless one of the statutory exceptions of Section 11030) of the Ethics Act would be applicable. Additionally, the disclosure requirements of Section 11030) of the Ethics Act would have to be satisfied in the event of a voting conflict. 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. Pursuant to Section 1107(11) of the Ethics Act, an Advice of Counsel 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 requester 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. Respectfully, Bridget K. Guilfoyle Chief Counsel