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HomeMy WebLinkAbout03-594 YorkRobert C. York 532 Pine Street Kulpmont, PA 17834 Dear Mr. York: ADVICE OF COUNSEL October 3, 2003 03 -594 Re: Conflict; Public Official /Employee; Member; Municipal Authority; Surveyor; Performing Survey Work for the Authority; Contract. This responds to your letter of September 2, 2003, by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq., presents any prohibition or restrictions upon an authority board member, who in a private capacity, is a registered professional surveyor, as to performing survey work for the authority. Facts: You are a Member of the Board of Directors of the Kulpmont Marion Heights Joint Municipal Authority ( "Authority "), having been appointed to fill the unexpired term of a member who passed away. You were subsequently appointed to a full five -year term on the Authority Board. Your term expires in 2006. In a private capacity, you are a registered professional surveyor. You state that you were a surveyor long before you became an Authority Board Member. The Authority is in the final stages of preparing plans for a 3.5 million dollar upgrade of its sewer lines and treatment plant. The Authority advertised for bids in mid June and opened the bids at its July meeting. At the present time, the facility is enclosed by a fence. However, the property is larger than the enclosed area. As part of the construction of the upgraded facility, the fence will be removed and relocated in three locations. During discussions of the Authority Board regarding the scope of the project, it was noted that the existing property lines were not well defined. The roperty lines shown on the construction drawings were taken from the "as- built" plans for the original facility and were not surveyed. York, 03 -594 October 3, 2003 Page 2 You have been asked to perform the necessary survey work to determine the location of the property lines. You state that you did not solicit the job. You ask whether you would have a conflict of interest in performing the survey work for the Authority. You further ask whether you may only charge $500 for your work. 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. As a Member of the Board of Directors of the Kulpmont Marion Heights Joint Municipal Authority ( "Authority "), you are a public official as that term is defined in the Ethics Act, and hence you are subject to the provisions of that Act. 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. 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 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. York, 03 -594 October 3, 2003 Page 3 "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 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). York, 03 -594 October 3, 2003 Page 4 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 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. York, 03 -594 October 3, 2003 Page 5 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, it is noted that Section 1103(a) of the Ethics Act pertaining to conflicts of interest does not prohibit public officials /public employees from having outside business activities or employment; however, the public official /public employee may not use the authority of his public position - -or confidential information obtained by being in that position- -for the advancement of his own private pecuniary benefit or that of a business with which he is associated. Pancoe, Opinion 89 -011. Examples of conduct that would be prohibited under Section 1103(a) would include: (1) the pursuit of a private business opportunity in the course of public action, Metrick, Order 1037; (2) the use of governmental facilities, such as governmental telephones, postage, staff, equipment, research materials, or other property, or the use of governmental personnel, to conduct private business activities, Freind, Order 800; Pancoe, supra; and (3) the participation in an official capacity as to matters involving the business with which the public official /public employee is associated in his private capacity, Gorman, Order 1041, or private client(s). Miller, Opinion 89 -024; Kannebecker, Opinion 92 -010. If the private employer or business with which the public official /public employee is associated or a private client would have a matter pending before the governmental body, the public official /public employee would have a conflict of interest as to such matter. Miller, supra; Kannebecker, supra. A reasonable and legitimate expectation that a business relationship will form may also support a finding of a conflict of interest. Amato, Opinion 89 -002. In each instance of a conflict of interest, the public official /public employee would be required to abstain from participation and to satisfy the disclosure requirements of Section 11030) set forth above. The abstention requirement would not be limited merely to voting, but would extend 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. As an Authority Board Member, you would generally have a conflict of interest under Section 1103(a) of the Ethics Act as to matters that would financially benefit yourself, a member of your immediate family, a business with which you or a member or your immediate family is associated, or business client(s). See, Miller, supra; Kannebecker, supra. In that you have a reasonable and legitimate expectation of forming a business relationship with the Authority, you would specifically have a conflict of interest as to participating in drawing up specifications for a surveying contract, reviewing or selecting bids or proposals, and voting to award the contract. See, Amato, supra. A conflict would exist even as to action to eliminate competitor(s), where such action would assure or increase the possibility that the Authority would award a contract to you. See, Pepper, Opinion 87 -008. In each instance of a conflict, you would be required to abstain and observe the disclosure requirements of Section 1103(j) of the Ethics Act as set forth above. Further, where Section 1103(f) applies, its requirements must be strictly observed. Under the facts that you have submitted, the governmental body with which you as a Board Member would be associated would be the Authority. Accordingly, any contract between you and the Authority, if over $500, would be subject to the restrictions of Section 1103(f). Parenthetically, although the contracting in question would not be prohibited under the Ethics Act provided the requirements of Sections 1103(a), 1103(f), and 1103(j) are satisfied, a problem may exist as to such contracting under the Municipality Authorities Act of 1949, as amended. York, 03 -594 October 3, 2003 Page 6 In the instant situation, the Municipality Authorities Act of 1945, as amended, provides as follows: §5614. Competition in award of contracts (e) Conflict of interest.— No member of the authority or officer or employee of the authority may directly or indirectly be a party to or be interested in any contract or agreement with the authority if the contract or agreement establishes liability against or indebtedness of the authority. Any contract or agreement made in violation of this subsection is void, and no action may be maintained on the agreement against the authority.... 53 Pa.C.S. § 5614. Since such contracting may be prohibited by the above quoted provision of the Municipality Authorities Act, and since the State Ethics Commission does not administer or enforce that Act, it is suggested that you seek legal advice in that regard. 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. Conclusion: As a Member of the Board of Directors of Kulpmont Marion Heights Joint Municipal Authority ( "Authority "), you are a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. As an Authority Board Member, you would generally have a conflict of interest under Section 1103(a) of the Ethics Act as to matters that would financially benefit yourself, a member of your immediate family, a business with which you or a member or your immediate family is associated, or business client(s). In that you have a reasonable and legitimate expectation of forming a business relationship with the Authority, you would specifically have a conflict of interest as to participating in drawing up specifications for a surveying contract, reviewing or selecting bids or proposals, and voting to award the contract. A conflict would exist even as to action to eliminate competitor(s), where such action would assure or increase the possibility that the Authority would award a contract to you. In each instance of a conflict, you would be required to abstain and observe the disclosure requirements of Section 1103(j) of the Ethics Act as set forth above. Where Section 1103(f) applies, its requirements must be strictly observed. Although the contracting in question would not be prohibited under the Ethics Act provided the requirements of Sections 1103(a), 1103(f), and 1103(j) are satisfied, such contracting may be prohibited by the Municipality Authorities Act of 1945, as amended. It is suggested that you seek legal advice in that regard. 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 York, 03 -594 October 3, 2003 Page 7 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