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HomeMy WebLinkAbout23-550 Confidential PHONE: 717-783-1610 STATE ETHICS COMMISSION FACSIMILE: 717-787-0806 FINANCE BUILDING WEBSITE: www.ethics.pa.gov TOLL FREE: 1-800-932-0936 613 NORTH STREET, ROOM 309 HARRISBURG, PA 17120-0400 ADVICE OF COUNSEL September 29, 2023 To the Requester: 23-550 This responds to your letter received September 20, 2023, by which you requested a confidential advisory from the Pennsylvania State Ethics Commission (“Commission”), seeking guidance as to the issue presented below: Issue: Whether the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., would impose any prohibitions or restrictions upon you following termination of your employment as a \[Position\] for the \[Commonwealth Entity\]. Brief Answer: YES. During the first year following termination of your Commonwealth employment, Section 1103(g) of the Ethics Act would apply and restrict you from engaging in any activity that would involve “representation” of a “person” — including but not limited to yourself or a \[Type of Firm\] that you established — before your “former governmental body,” the \[Commonwealth Entity\]. For a period of two years following termination of your Commonwealth employment, Section 1103(i) of the Ethics Act would restrict you from being employed by, receiving compensation from, assisting, or acting in a representative capacity for a business that you actively participated in recruiting to the Commonwealth or actively participated in inducing to open or expand a plant, facility, or branch in the Commonwealth through a grant or loan of money or a promise of a grant or loan of money from the Commonwealth. Facts: Confidential Advice, 23-550 September 29, 2023 Page 2 You request a confidential advisory from the Commission based upon submitted facts that may be fairly summarized as follows. From \[date\] until \[date\], you were employed as a \[Position\] for the \[Commonwealth Entity\]. In your Commonwealth position, you oversaw \[Certain Matters\] for various Commonwealth agencies, including \[List of Commonwealth Agencies\]. Following your departure from your Commonwealth employment, you established a \[Type of Firm\] named \[Name of Firm\], through which you hold multiple \[Type of Relationships\]. You state that you have successfully lobbied both \[Governmental Body 1\] and \[Governmental Body 2\]. You seek guidance as to whether the Ethics Act would impose any prohibitions or restrictions upon you following termination of your Commonwealth employment. In particular, you ask whether the Ethics Act would impose any restrictions upon you with regard to lobbying the Commonwealth agencies for which you oversaw \[Certain Matters\] during your Commonwealth employment or other Commonwealth agencies with which you did not interact. 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 requester based upon the facts that the requester has submitted. In issuing the advisory based upon the facts that the requester has submitted, the Commission does not engage in an independent investigation of the facts, nor does it speculate as to facts that have not been submitted. It is the burden of the requester 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 requester has truthfully disclosed all of the material facts. During your employment as a \[Position\] for the \[Commonwealth Entity\], you were considered a public official/public employee and an “executive-level State employee” subject to the provisions of the Ethics Act and the Regulations of the State Ethics Commission. See, 65 Pa.C.S. § 1102; 51 Pa. Code § 11.1; \[cite\]. Consequently, upon termination of your Commonwealth employment, you became a former public official/public employee and former executive-level State employee subject to the restrictions of Section 1103(g) and Section 1103(i) of the Ethics Act. Section 1103(i) restricts former executive-level State employees as follows: § 1103. Restricted activities (i)Former executive-level employee.--No former executive-level State employee may for a period of two years from the time that he terminates employment with this Commonwealth be employed by, receive compensation from, assist or act in a representative capacity for a business or corporation that he actively participated in recruiting to this Commonwealth or that he actively participated in inducing to open a new plant, facility or branch in Confidential Advice, 23-550 September 29, 2023 Page 3 this Commonwealth or that he actively participated in inducing to expand an existent plant or facility within this Commonwealth, provided that the above prohibition shall be invoked only when the recruitment or inducement is accomplished by a grant or loan of money or a promise of a grant or loan of money from the Commonwealth to the business or corporation recruited or induced to expand. 65 Pa.C.S. § 1103(i). Section 1103(i) restricts the ability of a former executive-level State employee to accept employment or otherwise engage in business relationships following termination of State service, under certain narrow conditions. The restrictions of Section 1103(i) apply even where the business relationship is indirect, such as where the business in question is a client of a new employer, rather than the new employer itself. See, Confidential Opinion, 94-011. However, Section 1103(i) would not restrict you from being employed by, receiving compensation from, assisting, or acting in a representative capacity for a business subject to the conditions that you did not actively participate in recruiting such business to Pennsylvania, and that you did not actively participate in inducing such business to open or expand a plant, facility, or branch in Pennsylvania, through a grant or loan of money or a promise of a grant or loan of money from the Commonwealth. Unlike Section 1103(i), Section 1103(g) does not prohibit a former public official/public employee from accepting a position of employment. However, it does restrict the former public official/public employee with regard to “representing” a “person” before “the governmental body with which he has been associated.” § 1103. Restricted activities (g) Former official or employee.--No former public official or public employee shall represent a person, with promised or actual compensation, on any matter before the governmental body with which he has been associated for one year after he leaves that body. 65 Pa.C.S. § 1103(g) (Emphasis added). The following terms related to Section 1103(g) are defined in the Ethics Act as follows: § 1102. Definitions “Represent.” To act on behalf of any other person in any activity which includes, but is not limited to, the following: personal appearances, negotiations, lobbying and submitting bid or contract proposals which are signed by or contain the name of a former public official or public employee. Confidential Advice, 23-550 September 29, 2023 Page 4 “Person.” A business, governmental body, individual, corporation, union, association, firm, partnership, committee, club or other organization or group of persons. “Governmental body with which a public official or public employee is or has been associated.” The governmental body within State government or a political subdivision by which the public official or employee is or has been employed or to which the public official or employee is or has been appointed or elected and subdivisions and offices within that governmental body. 65 Pa.C.S. § 1102. The term "Person" is very broadly defined. It includes, inter alia, corporations and other businesses. It also includes the former public employee himself, Confidential Opinion, 93-005, as well as a new governmental employer. Ledebur, Opinion 95-007. The term "representation" is also broadly defined to prohibit acting on behalf of any person in any activity. Examples of prohibited representation include: (1) personal appearances before the former governmental body or bodies; (2) attempts to influence; 3) submission of bid or contract proposals which are signed by or contain the name of the former public official/public employee; (4) participating in any matters before the former governmental body as to acting on behalf of a person; and (5) lobbying. Popovich, Opinion 89-005. Listing one's name as the person who will provide technical assistance on a proposal, document, or bid, if submitted to or reviewed by the former governmental body, constitutes an attempt to influence the former governmental body. Section 1103(g) also generally prohibits the inclusion of the name of a former public official/public employee on invoices submitted by his new employer to the former governmental body, even if the invoices pertain to a contract that existed prior to termination of service with such governmental body. Shay, Opinion 91-012. However, if such a pre-existing contract does not involve the unit where the former public employee worked, the name of the former public employee may appear on routine invoices if required by the regulations of the agency to which the billing is being submitted. Abrams/Webster, Opinion 95-011. A former public official/public employee may assist in the preparation of any documents presented to his former governmental body. However, the former public official/public employee may not be identified on documents submitted to the former governmental body. The former public official/public employee may also counsel any person regarding that person's appearance before his former governmental body. Once again, however, the activity in this respect should not be revealed to the former governmental body. The Ethics Act would not prohibit or preclude making general informational inquiries to the former governmental body to secure information which is available to the general public, but this must not be done in an effort to indirectly influence the former governmental body or to otherwise make known to that body the representation of, or work for, the new employer. Confidential Advice, 23-550 September 29, 2023 Page 5 Section 1103(g) only restricts the former public official/public employee with regard to representation before his former governmental body. The former public official/public employee is not restricted as to representation before other agencies or entities. However, the "governmental body with which a public official/public employee is or has been associated" is not limited to the particular subdivision of the agency or other governmental body where the public official/public employee had influence or control but extends to the entire body. See, Legislative Journal of House, 1989 Session, No. 15 at 290, 291; Sirolli, Opinion 90-006; Sharp, Opinion 90-009-R. The governmental body with which you are deemed to have been associated upon termination of your Commonwealth employment is the \[Commonwealth Entity\] in its entirety. Therefore, for the first year following termination of your Commonwealth employment, Section 1103(g) of the Ethics Act would apply and restrict you from representing a "person" — including but not limited to yourself or \[Name of Firm\] — before the \[Commonwealth Entity\]. You are advised that during the first year following termination of your Commonwealth employment, Section 1103(g) of the Ethics Act would restrict you from performing any lobbying that would involve prohibited representation before the \[Commonwealth Entity\] as set forth above. Section 1103(g) of the Ethics Act would not restrict you from lobbying the Commonwealth agencies for which you oversaw \[Certain Matters\] during your Commonwealth employment or other Commonwealth agencies with which you did not interact as long as in so doing, you would not engage in prohibited representation before the \[Commonwealth Entity\]. Lastly, 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. Conclusion: During your employment as a \[Position\] for the \[Commonwealth Entity\], you were considereda public official/public employee and an “executive-level State employee” subject to the Ethics Act and the Regulations of the State Ethics Commission. Upon termination of your Commonwealth employment, you became a former public official/public employee and a former executive-level State employee subject to the restrictions of Section 1103(g) and Section 1103(i) of the Ethics Act. Under Section 1103(i) of the Ethics Act, you would not be prohibited from being employed by, receiving compensation from, assisting, or acting in a representative capacity for a business subject to the conditions that you did not actively participate in recruiting such business to Pennsylvania, and that you did not actively participate in inducing such business to open or expand a plant, facility, or branch in Pennsylvania, through a grant or loan of money or a promise of a grant or loan of money from the Commonwealth. The governmental body with which you are deemed to have been associated upon termination of your Commonwealth employment is the \[Commonwealth Entity\] in its entirety. For the first year following termination of your Commonwealth employment, Section 1103(g) of the Ethics Act would apply and restrict you from representing a "person" — including but not limited to yourself or your \[Type of Firm\], \[Name of Firm\] — before the \[Commonwealth Entity\]. The restrictions as to representation outlined above must be followed. Confidential Advice,23-550 September 29, 2023 Page 6 Pursuant to Section 1107(11) of the Ethics Act, 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 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 ChiefCounsel