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HomeMy WebLinkAbout24-572 Stedman PHONE: 717-783-1610 STATE ETHICS COMMISSION FACSIMILE: 717-787-0806 TOLL FREE: 1-800-932-0936 FINANCE BUILDING WEBSITE: www.ethics.pa.gov 613 NORTH STREET, ROOM 309 HARRISBURG, PA 17120-0400 ADVICE OF COUNSEL November 14, 2024 To the Requester: Brett W. Stedman, Esquire 24-572 Dear Mr. Stedman: This responds to your letter dated October 31, 2024, by which you requested an advisory from the Pennsylvania State Ethics Commission (“Commission”), seeking guidance as to theissue presented below: Issue: Whetherthe Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq., would impose prohibitions or restrictions upon an individual employed as an Inspector for the City of Hermitage (“City”) with regard to using information about properties with active or past code enforcement violations that was obtained during the performance of his job duties to purchase such property with a business partner in order to later sell the property for a profit. Brief Answer: YES. Because information regarding City code enforcement activities generally is not provided to the public and most records related to such activities are exempt from Right-to-Know requests under the Right-to-Know Law, 65 P.S. § 67.101 et seq., such information and records would be considered “confidential” as that term is defined by the Ethics Act. Therefore, Section 1103(a) of the Ethics Act (pertaining to conflict of interest and the use of confidential information to obtain a private pecuniary/financial benefit) would prohibit the individual from using information about properties with active or past code enforcement violations that was obtained during the performance of his job duties to purchase such property with a business partner in order to later sell the property for a profit. Stedman 24-572 November 14, 2024 Page 2 Facts: As the City Solicitor, you have been authorized by Jeffrey Osborne (“Mr. Osborne”) to request an advisory from the Commission on his behalf. You have submitted facts that may be fairly summarized as follows. Mr. Osborne is employed as an Inspector with the City. Mr. Osborne’s primary job duties include inspecting properties for compliance with the Uniform Construction Code, the City’s Subdivision and Land Development Ordinance, and the City’s zoning ordinance, and he occasionally engages in inspections and enforcement actions under the City’s property maintenance ordinance. Mr. Osborne works with other City employees who enforce the City’s property maintenance ordinance, and he has access to and general knowledge of City code enforcement matters. Mr. Osborne would like to engage in business transactions with a partner. Mr. Osborne has proposed that he and his partner would purchase properties in the City and then either make improvements to the properties in order to sell them for a profit or sell the properties for a profit to another party who would then make improvements to the properties. Mr. Osborne learned that some of the properties at issue could be available for his business venture because of the properties having active or past code enforcement violations. Information regarding City code enforcement activities generally is not provided to the public, and most records related to such activities are exempt from Right-to-Know requests under Section 708(b)(17) of the Right-to-Know Law, 65 P.S. § 67.708(b)(17). Both the City and Mr. Osborne have concerns as to whether Mr. Osborne’s utilization of information that he learned about as part of his job duties to purchase properties subject to code violations could constitute a conflict of interest under Section 1103(a) of the Ethics Act. When the City learned that Mr. Osborne intended to jointly purchase a property that has an active code violation, the City took the position that Mr. Osborne may not do so unless the Commission issues an advisory opinion regarding the propriety of such a purchase. Based upon the above submitted facts, you seek guidance as to whether Mr. Osborne would have a conflict of interest with regard to using information about properties with active or past code violations that he obtained during the performance of his job duties to jointly purchase such property with a business partner in order to later sell the property for a profit. 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. 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 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 material facts. Stedman24-572 November 14, 2024 Page 3 Section1103of the Ethics Actimposes certain restrictions upon public officials and public employees. Section 1103 provides, in pertinent part, as follows: § 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 related to Section 1103(a) 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. “Confidential information.” Information not obtainable from reviewing a public document or from making inquiry to a publicly available source of information. 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. Stedman 24-572 November 14, 2024 Page 4 In each instance of a conflict of interest, the public official/public employee would be required to abstain from participation. The abstention requirement 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. Conclusion: In applying the above provisions of the Ethics Act to the instant matter, you are advised as follows. As an Inspector with the City, Mr. Osborne is a “public employee” subject to the Ethics Act and the Regulations of the State Ethics Commission. See, 65 Pa.C.S. § 1102; 51 Pa. Code § 11.1. This conclusion is based upon the submitted facts, which when reviewed on an objective basis, indicate clearly that the power exists to take or recommend official action of a non- ministerial nature with respect to one or more of the following: contracting; procurement; administering or monitoring grants or subsidies; planning or zoning; inspecting; licensing; regulating; auditing; or other activity(ies) where the economic impact is greater than de minimis on the interests of another person. Pursuant to Section 1103(a) of the Ethics Act, Mr. Osborne would be prohibited from using the authority of his public position as an Inspector with the City or confidential information received through holding his public position for the private pecuniary (financial) benefit of himself, a member of his immediate family, or a business with which he or a member of his immediate family is associated.Because information regarding City code enforcement activities generally is not provided to the public and most records related to such activities are exempt from Right-to-Know requests under the Right-to-Know Law, such information and records would be considered “confidential” as that term is defined by the Ethics Act. Therefore, Section 1103(a) of the Ethics Act would prohibit Mr. Osborne from using information about properties with active or past code violations that he obtained during the performance of his job duties to jointly purchase such property with a business partner in order to later sell the property for a profit. Cf., Reaves, Order 1260;Metrick, Order 1037. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. 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. Stedman 24-572 November 14, 2024 Page 5 Any such appeal must be in writing and must be actually receivedat 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