HomeMy WebLinkAbout160-SL 21st CentEdPHONE: 717-783-1610 sTA:rE E"I"HICS COMMISSION FACSIMILE: 717-787-0806
TOLL. FREE: 1-800-032-0936 FINANCE BUILDING WEBSITE: wyvw.ethic1-1S.1L&.%1v
613 NOi,° Ti-I STREET, ROOM 309
11ARRISBURG, PA 17120-04,00
In Re: 21 "CentEd, formerly known as TechTrep, File Docket: 22-011-L
Respondent Order No. 160-SL
Date Decided: 6/29/23
Date Mailed; 6/30/23
Before: Shelley Y. S,imms, Chair
Michael A. Schwartz, Vice Chair
Rhonda Hill Wilson
Paul E. Parsells
David L. Reddecliff
Robert P. Caruso
This is a final adjudication of the State Ethics Commission as to the alleged delinquency
and/or deficiency of expense report(s), required to be filed pursuant to Pennsylvania's lobbying
disclosure law, 65 Pa.C.S. § 13AOI et seq., hereinafter referred to as the "Lobbying Disclosure
Law."
The Investigative Division initiated these proceedings by filing with the State Ethics
Commission and serving upon Respondent 21 stCentEd, formerly to-lown as TechTrep (hereinafter
also referred to as "Respondent," . 21stCentEd" or "Tech Trep") a Notice of Alleged
Noncompliance, A Stipulation of Findings and a Consent Agreement were subsequently submitted
by the parties to the Commission for consideration, The Stipulated Findings are set forth as the
Findings in this, Order. The Consent Agreement has been approved.
I. ALLEGED NONCOMPLIANCE:
That Respondent, in its, capacity as a principal registered with the Department of State
pursuant to the Lobbying Disclosure Law (65 Pa.C.S. § 13AOI et �jgq.), Failed to timely file
a quarterly expense report pursuant to 65 Pa.C.S. § 13A05 for the second (2 nd ) quarter of
2022.
II. FINDINGS:
Respondent is a registered principal as that term is defined by the Pennsylvania Lobbying
Disclosure Law ("Lobbying Disclosure Law") Act 134 of 2006, 65 Pa.C.S. § 13AOI et
M.
a. Respondent initially registered as a principal under the name TechTrep with the
Department of State on August 10, 2018, for the registration period January 1, 2017
21"CentEd, 22-011-L
Page 2
through December 31, 2018.
b. Respondent's registration statement indicates that lobbying commenced on August
1, 2018.
C. On December 21, 2022, Respondent changed its registration name to 21"CentEd.
2. Respondent filed a principal registration statement with the Pennsylvania Department of
State for the registration period January 1, 2021 through December 31, 2022.
a. By registering with the Department of State, Respondent consented to receive
service of notices, other official mailings, or process at the address listed on the
registration statement.
b. Respondent was assigned the principal registration number "P56412 "
C. In filing its principal registration, Respondent identified its registered mailing
address as:
815 W. 1250 S.
Suite 202
Orem, UT 84058
3. The Lobbying Disclosure Law, specifically 65 Pa.C.S. § 13A04, states the following
regarding the registration of an entity as a principal:
§ 13A04. Registration
a. General rule. --Unless excluded under section 13A06
(relating to exemption from registration and reporting), a
lobbyist, lobbying firm or a principal must register with the
department electronically using the computerized filing
system developed by the department that is consistent with
the purposes of this chapter within ten days of acting in any
capacity as a lobbyist, lobbying firm or principal.
Registration shall be biennial and shall begin January 1,
2007.
b. Principals and lobbying firms.--
1. A principal or lobbying firm required to register
under subsection (a) shall file a single registration
statement setting forth the following information
with the department:
21 "CentEd, 22-011-L
Page 3
i. Name of the business.
ii. Permanent address.
iii. Daytime telephone number.
iv. E-mail address of the authorized
representative employee or agent, if
available.
V. Nature of business.
vi. Name, registration number and acronym of
any affiliated political action committees.
vii. Name and permanent business address of
each individual who will for economic
consideration engage in lobbying on behalf
of the principal or lobbying firm.
viii. Registration number when available.
ix. Name of the authorized representative,
employee or agent.
d. Amendments.—
1. If there is a change of information required for the
registration statement under subsection (b)(1) or (2)
or (c), an amended registration statement shall be
filed with the department electronically using the
computerized filing system developed by the
department that is consistent with the purpose of this
chapter within 14 days after the change occurs.
2. When there is a change in information required for
the registration statement under subsection (b)(3), an
amended registration statement shall be filed with the
department electronically using the computerized
filing system developed by the department that is
consistent with the purpose of this chapter within 14
days of the end of the year in which the change
occurs.
65 Pa.C.S. § 13A04(a), (b)(1), (d).
4. Section 13A03 of the Lobbying Disclosure Law defines the following terms:
"Lobbying." An effort to influence legislative action or
administrative action in this Commonwealth. The term includes:
(1) direct or indirect communication;
21"CentEd, 22-011-L
Page 4
(2) office expenses; and
(3) providing any gift, hospitality, transportation or lodging to a
State official or employee for the purpose of advancing the
interest of the lobbyist or principal.
"Legislative action." An action taken by a State official or
employee involving the preparation, research, drafting,
introduction, consideration, modification, amendment, approval,
passage, enactment, tabling, postponement, defeat or rejection of:
(1) legislation;
(2) legislative motions;
(3) a veto by the Governor; or
(4) confirmation of appointments by the Governor or
appointments to public boards or commissions by a member
of the General Assembly.
"Legislation." Bills, resolutions, amendments and nominations
pending or proposed in either the Senate or the House of
Representatives. The term includes any other matter which may
become the subject of action by either chamber of the General
Assembly.
"Direct communication." An effort, whether written, oral or by
any other medium, made by a lobbyist or principal, directed to a
State official or employee, the purpose or foreseeable effect of
which is to influence legislative action or administrative action. The
term may include personnel expenses and office expenses.
65 Pa.C.S. § 13A03.
5. In addition to the Lobbying Disclosure Law, the duly promulgated Regulations provide
further information in relation to registration periods and reporting periods:
§ 51.3. Registration periods and reporting periods.
a. Registration under section 13A04 of the act (relating to
registration) shall be biennial. The first registration period
which commenced January 1, 2007, continues through
December 31, 2009. Subsequent registrations shall
commence on January 1 of each odd numbered year.
51 Pa. Code § 51.3(a).
21"CentEd, 22-011-L
Page 5
6. Section 13A05 of the Lobbying Disclosure Law sets forth, in part, the following
requirements for the contents of quarterly reporting forms filed by principals:
§ 13A05. Reporting
(a) General rule.-- A registered principal shall, subject to the
penalties under 18 Pa.C.S. § 4904 (relating to unsworn
falsification to authorities), file quarterly expense reports
with the department electronically using the computerized
filing system developed by the department that is consistent
with the purpose of this chapter no later than 30 days after
the last day of the quarter.
65 Pa.C.S. § 13A05(a).
7. In addition to the Lobbying Disclosure Law, the duly promulgated Regulations provide
further instructions in relation to registration periods and reporting periods:
§ 51.3. Registration periods and reporting periods.
(b) Reporting under section 13A05 of the act (relating to
reporting) shall be quarterly within each calendar year: for
January through March; April through June; July through
September; and October through December. Quarterly
expense reports shall be filed on or before the 30th day after
the quarterly reporting period ends.
51 Pa. Code § 51.3(b).
8. As a registered principal, Respondent is required to electronically file with the Department
of State either a quarterly expense report or a statement of failure to meet the reporting
threshold for each quarter it has been registered as a principal, by no later than the 30'h day
after each quarterly reporting period has ended. 65 Pa.C.S. § 13A05(a), (d); 51 Pa. Code
§ 55.1(d).
9. Section 13A05 of the Lobbying Disclosure Law additionally sets forth the threshold with
regard to reporting expenditures:
(d) Thresholds for reporting.-- An expense report required
under this section shall be filed when total expenses for
lobbying exceed $3,000 for a registered principal in a
reporting period. In a reporting period in which total
expenses are $3,000 or less, a statement to that effect shall
be filed.
21 "CentBd, 22_011-L
Page 6
65 Pa.C.S. § 13A05(d).
10. As a registered principal, Respondent is required to file quarterly expense reports with the
Department of State for all. quarters it is registered as a principal; including quarters in
which Respondent's lobbying expenses are $3,000.00 or less.
a. Respondent did not file a second (2"d) quarter 2022 expense report by August 1, 2022;
July 30, 2022 was a Saturday, making the due date the following Monday.
b. Respondent has remedied the failure by filing its expense report for the second (2°d)
quarter 2022 on December 21, 2022,
11. The Regulations promulgatQd under the Lobbying Disclosure Law specifically provide the
following in relation to a delinquent filing:
§ 51.4. Delinquency.
(b) A failure to timely file a registration statement, a quarterly
expense report, a separate expense report, a notice of
termination or an amendment to one of these filings constitutes
a failure to register or report as required by the act; delinquency
continues until the filing is received by the Department in
proper form.
51 Pa. Code § 51.4(b).
12. In relation to the filing requirements of quarterly expense reports, the Regulations read, in
part:
§ 55.1. Quarterly expense reports.
(a) A quarterly expense report is required to be filed as set forth
in this section when the total lobbying expenses of a
registered principal, registered lobbying firm or registered
lobbyist lobbying on the principal's behalf, together, exceed
[$3,000] in a quarterly reporting period. The threshold of
[$3,000] includes any economic consideration paid by a
principal to a lobbying firm or lobbyist for lobbying.
Individuals exempt under section 13A06 of the act (relating
to exemption from registration and reporting) need not
register or report.
21"CentEd, 22-011-L
Page 7
(b) For a quarterly reporting period in which the total lobbying
expenses of a registered principal, registered lobbying firm
or registered lobbyist lobbying on the principal's behalf,
together, are [$3,000] or less, a statement to that effect shall
be filed with the Department by checking the appropriate
block on the quarterly expense report form.
(d) The principal shall file a quarterly expense report or
statement of failure to meet the reporting threshold on or
before the 30th day after the quarterly reporting period ends.
(g) A quarterly expense report of a principal required to be
registered under the act must include at least the following
information:
(3) The total costs of all lobbying for the period. The
total must include all office expenses, personnel
expenses, expenditures related to gifts, hospitality,
transportation and lodging to State officials or
employees, and any other lobbying costs.
(i) The total amount reported under this
paragraph shall be allocated in its entirety
among the following categories:
(A) The costs for gifts, hospitality,
transportation and lodging given to or
provided to State officials or
employees or their immediate
families.
(B) The costs for direct communication.
(C) The costs for indirect communication.
Registrants shall use a good faith effort to
allocate expenses required to be reported
under this subsection to one of the three
categories listed herein. A given expense may
not be included in more than one category...
2151CentEd, 22-011-L
Page 8
51 Pa. Code § 55.1(a), (b), (d), (g)(3)(i)-(ii).
13. By Warning Notice letter dated September 15, 2022, Respondent was served with notice'
in accordance with Section 13A09 of the Lobbying Disclosure Law and Section 63.4(1) of
the Lobbying Disclosure Regulations of the specific allegations: that Respondent failed to
file quarterly expense reports for the second (2"d) quarter of 2022.
a. Said Warning Notice was mailed to:
TechTrep
250 W. Center Street
Suite 105
Provo, UT 84601
b. This is the same address as listed on Respondent's principal registration statement.
14. Said Warning Notice letter set forth the nature of the alleged noncompliance and the
administrative and criminal penalties for failing to file.
15. Said Warning Notice letter provided Respondent an opportunity to cure the alleged
noncompliance and avoid the institution of these proceedings as to alleged noncompliance
by filing a quarterly expense report for the time period covering the second (2nd) quarter
of 2022 with the Department of State within thirty (30) days from the mailing date of the
Warning Notice letter.
16. The Director of the Bureau of Campaign. Finance and Civic Engagement - Department of
State conducted a search of the Department of State's records, and, as of October 19, 2022,
no second (2"d) quarter of 2022 expense report was found to have been filed with the
Department of State for 21 stCentEd, formerly known as TechTrep.
17. The Lobbying Disclosure Law provides for civil and criminal penalties for failing to
comply with the registration statement filing and quarterly expense reporting requirements
thereof. In pertinent part, the Lobbying Disclosure Law provides that:
a. Negligent failure to register or report as required by this chapter is
punishable by an administrative penalty not exceeding the
following:
(i) For the first ten late days, $50 for each late day.
(ii) For each late day after the first ten late days through the 20`1'
' Respondent also was emailed by the Investigative Division on September 27, 2022 at the email assigned to their
Registration notifying them that they were facing enforcement for their failure to file their 2" d Quarter 2022 expense
report.
21"CentPd, 22-011-L
Page 9
late day, $100 for each late day.
(iii) For each late day after the first 20 late days, $200 for each
late day.
65 Pa.C.S. § 13A09(c)(1).
b. The total amount of the administrative penalty that may be levied
after hearing by a majority vote of all of the Commission Members
shall not be limited by any other provision of law. 65 Pa.C.S. §
13A09(c)(2).
c. Any person that fails to comply with the requirements of the
Lobbying Disclosure Law, after notice of noncompliance and after
a hearing if one is requested, may be prohibited from lobbying for
economic consideration for up to five (5) years [in accordance with
65 Pa.C.S. § 13A09(e)(4)j. 65 Pa.C.S. §§ 13A09(d), (e)(4).
18. The initial Notice of Alleged of Noncompliance was filed on November 3, 2022.
a. The Notice was mailed to the mailing address listed on Respondent's principal
registration statement and Respondent's quarterly expense report for the reporting
period of 1/1/2022-3/31/2022.
b. The Notice was returned as unable to be delivered as addressed.
c. A phone call was made to the listed phone number to the listed authorized
representative on November 28, 2022; there was no answer, and a message was left.
d. On December 21, 2022, a representative from Respondent contacted the Investigative
Division in response to that phone tail.
19. Respondent's expense reports for the second (2°d) and third (3`d) quarters of 2022 were
filed on December 21, 2022.
20. Respondent's second (2nd) quarter expense report was one hundred and forty one (141)
days delinquent.
a. The second (2°a) quarter expense report period closed June 30, 2022. See, 65 Pa.C.S.
§ 13A03 Definitions — "Reporting period."
b. Expense reports were to be filed within thirty (30) days of June 30, 2022, that date
being July 30, 2022. See, 65 Pa.C.S. § 13A05(a).
c. The first day in which Respondent's second (2"d) quarter 2022 expense report was
21 "CentEd, 22-0I 1-L
Page 10
delinquent was August 2, 2022, as July 30 was a Saturday.
21. Respondent has presented mitigation in this matter:
a. Respondent is a small organization, with a limited number of personnel;
b. Upon learning about the failure to file, Respondent did file the second (2" d) quarter
expense report as well as the third (3rd) quarter expense report;
c. Respondent has hired an attorney and taken remedial steps to prevent future violations;
and
d. Respondent is currently up to date on filing and has properly filed all expense reports.
III. DISCUSSION:
In the instant matter, the alleged noncompliance is that Respondent, as a principal
registered with the Pennsylvania Department of State ("Department of State") pursuant to the
Lobbying Disclosure Law, failed to timely file a quarterly expense report pursuant to 65 Pa.C.S. §
13A05 for the second quarter of 2022.
As noted above, the parties have submitted a Consent Agreement and Stipulation of
Findings. The parties' Stipulated Findings are set forth above as the Findings of this Commission.
We shall now summarize the relevant facts as contained therein.
Respondent initially registered as a principal under the name TechTrep with the
Department of State on August 10, 2018, for the registration period January 1, 2017, through.
December 31, 2018. Respondent's registration statement indicated that lobbying commenced on
August 1, 2018. Respondent was assigned the principal registration number "P56412."
Respondent subsequently changed its registration name to 21 "Cent Ed. Per the Consent Agreement
of the parties, Respondent was registered as a principal with the Department of State for the
registration period January 1, 2021, through December 31, 2022.
Pursuant to Section 13A05 of the Lobbying Disclosure Law, 65 Pa.C.S. § 13A05, and
Section 51.3 of the Lobbying Disclosure Regulations, 51 Pa. Code § 513, expense reports are filed
on a quarterly basis. When a registered principal's total expenses for lobbying exceed $3,000 for
a reporting period/quarter, the principal is required to file a quarterly expense report with the
Department of State by no later than 30 days after the last day of such quarter. For a reporting
period in which total expenses are $3,000 or less, a statement to that effect must be filed with the
Department of State by the principal by checking the appropriate block on the quarterly expense
report form. 51 Pa. Code § 55.1(b). Thus, a registered principal must file either a quarterly
expense report or a statement of failure to meet the reporting threshold by no later than the 30th
day after each quarterly reporting period ends. 51 Pa. Code § 55.1(d).
21 "CentEd, 22-011-L
Page 11
Having registered for the registration period January 1, 2021, through December 31, 2022,
Respondent was required to file either a quarterly expense report or a statement of failure to meet
the reporting threshold for the second quarter of 2022. Respondent failed to file either.
Failure to timely meet the aforesaid filing requirement constitutes a failure to report as
required by the Lobbying Disclosure Law, and the delinquency continues until the filing is
received by the Department of State in proper form. 51 Pa. Code § 51.4(b).
By Warning Notice letter dated September 15, 2022, Respondent was served with notice
of the alleged noncompliance in accordance with Section 63.4(1) of the Lobbying Disclosure
Regulations, 51 Pa. Code § 63.4(1). The Warning Notice letter provided Respondent an
opportunity to cure the alleged noncompliance and avoid the institution of these proceedings by
filing a quarterly expense report for the second quarter of 2022 with the Department of State within
thirty (30) days of the mailing date of the Warning Notice letter.
As of October 19, 2022, no second quarter 2022 expense report was found to have been
filed with the Department of State for the Respondent.
On December 21, 2022, Respondent submitted a quarterly expense report for the second
quarter and the third quarter of 2022.
Negligent failure to register or report as required by the Lobbying Disclosure Law is
punishable by an administrative penalty as follows: (1) for the first ten late days, $50.00 for each
late day; (2) for each late day after the first ten late days through the 20'h late day, $100 for each
late day; and (3) for each late day after the first 20 late days, $200 for each late day. 65 Pa.C.S. §
13A09(c)(1).
Having highlighted the Stipulated Findings and issues before us, we shall now apply the
Lobbying Disclosure Law to determine the proper disposition of this case.
The parties' Consent Agreement sets forth a proposed resolution of the allegations as
follows:
3. The Investigative Division will recommend the following
conclusions in relation to the above deficiencies:
a. That Respondent, in its capacity as a Principal
registered with the Pennsylvania Department of State
pursuant to the Pennsylvania Lobbying Disclosure
Law (65 Pa.C.S. § 13A01 et se .), failed to timely
file a Quarterly Expense Report pursuant to 65
Pa.C.S. § 13A05, for the second quarter (2"d) quarter
of 2022;
21"CentEd, 22-011-L
Page 12
i. On September 15, 2022, a Warning Notice
regarding the delinquent quarterly expense report
was sent to Respondent via First Class United
States Mail; and
ii. Respondent did not file the outstanding Quarterly
Expense Report for the second (2") quarter 2022
within the stated cure period.
b. That the transgressions of the Lobbying Disclosure
Law outlined in paragraph (a) above are deemed
negligent in nature;
C. Respondent has presented the following mitigation
in the matter;
i. Respondent is a small organization, with a
limited number of personnel;
ii. Upon learning about the failure to file,
Respondent did file the second (2"d) quarter
expense report as well as the third (3`j) quarter
expense report;
iii. Respondent has hired an attorney and taken
remedial steps to prevent future violations; and
iv. Respondent is currently up to date on filing and
has properly filed all expense reports.
4. In regard to Respondent's failure to file a timely second (2'd) quarter
2022 expense report, and pursuant to Section 13A09 (c)(1) of the
Lobbying Disclosure Law, 65 Pa.C.S. § 13A09(c)(1), Respondent
agrees to pay a total amount of $10,000.00, which shall be made
payable to the Commonwealth of Pennsylvania and forwarded to the
Pennsylvania and forwarded to the Pennsylvania State Ethics
Commission within 30 days of the adjudication in this matter.
5. The Investigative Division will recommend that the State Ethics
Commission take no further action in this matter; and make no
specific recommendations to any law enforcements or other
authority to take action in this matter. Such, however, does not
prohibit the Commission from initiating appropriate enforcement
actions in the event of Respondent's failure to comply with this
21s1CentEd, 22-011-L
Page 13
agreement or the Commission's order or cooperating with any other
authority who may so choose to review this matter further.
Consent Agreement, at 1-2.
In considering the Consent Agreement and Stipulation of Findings, we agree with the
parties that Respondent as a registered principal failed to timely file a quarterly expense report
with the Department of State for the second quarter of 2022 as required by Section 13A05 of the
Lobbying Disclosure Law.
Accordingly, we hold that Respondent, as a registered principal, failed to timely file a
quarterly expense report with the Department of State for the second quarter of 2022 as required
by Section 13A05 of the Lobbying Disclosure Law. We accept the recommendation of the parties
for a determination that the transgression of the Lobbying Disclosure Law outlined immediately
above is deemed to be negligent in nature.
As part of the Consent Agreement, Respondent agreed to pay an administrative penalty in
the total amount of $10,000.00 payable to the Commonwealth of Pennsylvania and forwarded to
this Commission by no later than the thirtieth (30"') day after the mailing date of this Order.
We determine that the Consent Agreement submitted by the parties sets forth a proper
disposition for this case, based upon our review as reflected in the above analysis and the totality
of the facts and circumstances. Accordingly, we approve the Consent Agreement that has been
submitted by the parties.
Respondent is ordered to pay the aforesaid administrative penalty in the total amount of
$10,000.00 by way of certified check or money order in the amount of $10,000.00 payable to the
Commonwealth of Pennsylvania and forwarded to this Commission by no later than the thirtieth
(30th) day after the mailing date of this adjudication and Order.
Noncompliance will result in the institution of an order enforcement action.
IV. CONCLUSIONS OF LAW:
As a principal registered with the Pennsylvania Department of State ("Department of
State") under principal registration number "P56412," Respondent 21 stCentEd, formerly
known as TechTrep ("Respondent") has been subject to the reporting requirements of
Section 13A05 of Pennsylvania's Lobbying Disclosure Law ("Lobbying Disclosure Law"),
65 Pa.C.S. § 13A05.
2. Respondent, in its capacity as a principal registered with the Department of State under
principal registration number "P56412," failed to timely file a quarterly expense report
with the Department of State for the second quarter of 2022 as required by Section 13A05
of the Lobbying Disclosure Law, 65 Pa.C.S. § 13A05.
21 "Cents d, 22-011-L
Page 14
3. The transgression of the Lobbying Disclosure Law outlined in paragraph 2 immediately
above is deemed to be negligent in nature.
4. The prerequisite service of a warning notice in accordance with Section 63.4(1) of the
Lobbying Disclosure Regulations, 51 Pa. Code § 63.4(1), was satisfied.
5. Based upon the totality of the circumstances in this case, the imposition of an
administrative penalty in the total amount of $10,000,00 is warranted.
In Re: 21stCentEd, formerly known as TechTrep, File Docket: 22-011-L
Respondent Date Decided: 6/29/23
Date Mailed: 6/30/23
ORDER NO. 160-SL
Respondent 21 stCentEd, formerly known as TechTrep ("Respondent"), in its capacity as a
principal registered with the Pennsylvania Department of State ("Department of State")
under principal registration number "P56412," failed to timely file a quarterly expense
report with the Department of State for the second quarter of 2022 as required by Section
13A05 of Pennsylvania's lobbying disclosure law ("Lobbying Disclosure Law"), 65
Pa.C.S. § 13A05.
3. Pursuant to Section 13A09(c) of the Lobbying Disclosure Law, 65 Pa.C.S. § 13A09(c),
and the Consent Agreement of the parties, this Commission hereby levies one
administrative penalty against Respondent in the total amount of $10,000.00 for its
delinquent second quarter 2022 expense report.
4. Respondent is ordered to pay the aforesaid administrative penalty in the total amount of
$10,000.00 by way of certified check or money order in the amount of $10,000.00 payable
to the Commonwealth of Pennsylvania and forwarded to the Pennsylvania State Ethics
Commission by no later than the thirtieth (30t") day after the mailing date of this Order.
5. Noncompliance with Paragraph 4 of this Order will result in the Commission initiating
appropriate enf6rcement action(s).
BY THE COMMISSION,
Shelley Y. Si , Chair