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HomeMy WebLinkAbout04-579 ClarkEdwin M. Clark, Jr., Esquire Holsinger, Clark & Armstrong 832 Philadelphia Street Indiana, PA 15701 ADVICE OF COUNSEL August 4, 2004 04 -579 Re: Conflict; Public Official; School Director; Business With Which Associated; Bus Driver for Bus Company That Has Contract With School District. Dear Mr. Clark: This responds to your letters of June 10, 2004 and July 2, 2004, by which you requested advice from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa. .S. §1101 et seq. would present any prohibitions or restrictions upon a school director with respect to participating in official action regarding bus contract(s) or other transportation issues when the school director is a bus driver for a bus company that has a contract with the school district. Facts: As Solicitor for the United School District ( "School District "), you seek an advisory on behalf of a School Director who is a bus driver for Krise Bus Company, the bus contractor for the School District. You pose the following two questions: 1. Whether the School Director may participate in discussions concerning the bus contract between the School District and Krise Bus Company or vote on the bus contract itself; and 2. Whether the School Director may vote on or participate in any other matters dealing with Krise Bus Company, such as establishing routes or bus stops if the routes or bus stops involve the School Director's route or any other route. Discussion: It is initially noted that pursuant to Sections 1107(10) and (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. Clark, 04 -579 August 4, 2004 Page 2 The School Director on whose behalf you seek this advisory is a "public official" as that term is defined under the Ethics Act, and hence that School Director is 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. "Business." Any corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self - employed individual, holding company, joint 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. 65 Pa.C.S. §1102. 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 Clark, 04 -579 August 4, 2004 Page 3 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 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; Rembold, Order 1303; Wilcox, Order 1306). 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 1103(j) 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. In response to your first question, based upon the submitted facts, Krise Bus Company would be considered a business with which the School Director is associated assuming it is a business in which the School Director is a director, officer, owner, employee or has a financial interest. Pursuant to Section 1103(a) of the Ethics Act, the School Director would generally have a conflict of interest in matters before the School Board that would financially impact himself /herself or Krise Bus Company. Such matters would include discussions or votes pertaining to Krise Bus Company's contract with the School District or discussions or votes pertaining to other bus contracts. See, Fletcher, Opinion 89 -018 (wherein the Commission held that a school director employed Clark, 04 -579 August 4, 2004 Page 4 by contractor that transported school district students was prohibited from voting on the transportation contract involving her employer as well as other transportation contracts. The Commission found that the school director had a conflict as to other transportation contracts because the other contractors could be competitors of the school director's employer and the school director could cast negative votes so as to limit or eliminate the competition). In response to your second question, the requisite elements for establishing a conflict of interest under Section 1103(a) of the Ethics Act are: (1) the public official's /public employee's use of the authority of public office /employment or confidential information, for (2) the private pecuniary benefit of the public official /public employee himself, a member of his immediate family, or a business with which he or a member of his immediate family is associated. Based upon the limited facts, it is unknown whether the use of authority of office or confidential information by the School Director with respect to establishing routes or bus stops would result in a private pecuniary benefit to the School Director or Krise Bus Company. Therefore, a conclusive determination cannot be made as to whether a conflict of interest would exist. In each instance of a conflict, the School Director would be required to abstain and to fully satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. This Advice is limited to addressing the applicability of Section 1103(a) of the Ethics Act. It is expressly assumed that there has been no use of authority of office for a private pecuniary benefit as prohibited by Section 1103(a) of the Ethics Act. Further, you are advised that Sections 1103(b) and 1103(c) of the Ethics Act provide in part that no person shall offer to a public official /public employee and no public official /public employee shall solicit or accept anything of monetary value based upon the understanding that the vote, official action, or judgment of the public official /public 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. 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. Specifically not addressed herein is the applicability of Public School Code of 1949, as amended. Conclusion: The School Director for the United School District ( "School District ") on whose behalf you have requested this advisory is a public official subject to the provisions of the Ethics Act. Section 1103(a) of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. §1101 et seq. Krise Bus Company would be considered a business with which the School Director is associated assuming it is a business in which the School Director is a director, officer, owner, employee or has a financial interest. Pursuant to Section 1103(a) of the Ethics Act, the School Director would generally have a conflict of interest in matters before the School Board that would financially impact himself /herself or Krise Bus Company. Such matters would include discussions or votes pertaining to Krise Bus Company's contract with the School District or discussions or votes pertaining to other bus contracts. Based upon the limited facts, it is unknown whether the use of authority of office or confidential information by the School Director with respect to establishing routes or bus stops would result in a private pecuniary benefit to the School Director or Krise Bus Company. Therefore, a conclusive determination cannot be made as to whether a conflict of interest would exist. In each instance of a conflict, the School Director would be required to abstain and to fully satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Clark, 04 -579 August 4, 2004 Page 5 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 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