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HomeMy WebLinkAbout04-582 ReohrLaura E. Reohr 327 Allenview Drive Mechanicsburg, PA 17055 Dear Ms. Reohr: ADVICE OF COUNSEL August 10, 2004 04 -582 Re: Former Public Employee; Section 1103(g); Executive -Level State Employee; Section 1103(i); Deputy Secretary for Unemployment Compensation Programs; Department of Labor and Industry. This responds to your letter of July 9, 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., presents any restrictions upon employment of a Deputy Secretary of Unemployment Compensation following termination of service with the Department of Labor and Industry. Facts: You were formerly the Deputy Secretary for Unemployment Compensation Programs with the Department of Labor and Industry ( "L & 1 "), a position which you held since June 1, 2002 until your retirement on June 25, 2004. Prior to serving as Deputy Secretary for Unemployment Compensation Programs, you served for fifteen years as Bureau Director of the Office of Unemployment Compensation Tax Services (previously known as the Bureau of Employer Tax Operations). You state that you are uncertain whether an official job description exists for the position of Deputy Secretary for Unemployment Compensation Programs; however, you note that a person serving in that position is responsible for the total Pennsylvania unemployment compensation system, including but not limited to, administrative, technical, personnel, operational, and budgetary issues for Unemployment Compensation, including oversight for the unemployment compensation tax collection, benefit payment, and benefit appeals systems. A Request for Proposal ( "RFP ") will be issued by L & 1 to solicit proposals to replace the existing unemployment compensation information technology infrastructure and computer processes for unemployment compensation. You state that as Deputy Secretary for Unemployment Compensation, you had oversight over the RFP Reohr, 04 -582 August 10, 2004 Page 2 Development Team. You further state that the information was kept confidential until the RFP was released to the public. The question you pose is whether you may work with a company that would be developing a proposal to respond to the RFP. You state that the company's proposal would be submitted to L & I for evaluation against the RFP criteria, as well as other proposals submitted by other companies. You would not be working with a company until after L & I would release the RFP to the public. In addition, your name would not be included in the company's proposal or materials. You state that you would not have any contact with L & I or have any direct involvement with Commonwealth employees during this proposal development. 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. In the former capacity as Deputy Secretary of Unemployment Compensation Programs for L & I, you would be considered a "public employee" and an "executive - level State 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. Consequently, upon termination of public service, you became a "former 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. 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 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 the new employer, rather than the new employer itself. See, Confidential Opinion No. 94 -011. However, Section 1103(i) would not restrict you from Reohr, 04 -582 August 10, 2004 Page 3 being employed by, receiving compensation from, assisting, or acting in a representative capacity for the new employer provided and conditioned upon the assumptions that you did not actively participate in recruiting the new employer to Pennsylvania, and that you did not actively participate in recruiting or inducing the new employer 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 of Pennsylvania to the new employer. 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 terms "represent," "person," and "governmental body with which a public official or public employee is or has been associated" are specifically 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. "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 Reohr, 04 -582 August 10, 2004 Page 4 the former public official /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 though the invoices pertain to a contract that existed prior to termination of public service, 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 ublic 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. 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 /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 No. 90 -006; Sharp, Opinion 90- 009 -R. The governmental body with which you were associated upon termination of public service is L & 1 in its entirety. Therefore, for the first year after termination of your service with L & 1, Section 1103(g) of the Ethics Act would apply and restrict "representation" of "persons" before L & 1. Having set forth the restrictions of Sections 1103(g) and 1103(i) of the Ethics Act, you are advised that although the Ethics Act would not prohibit you from accepting employment with a company that may submit an RFP to L & 1, the Act would restrict your conduct in your new position to the extent that such conduct would constitute prohibited "representation" before L & 1 during the one -year period following your termination of service from L & 1. Based upon the facts which have been submitted, this Advice has addressed the applicability of Sections 1103(g) and 1103(i) only. 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 /employee 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. Reohr, 04 -582 August 10, 2004 Page 5 Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Specifically not addressed herein is the applicability of the Governor's Code of Conduct. Conclusion: Upon termination of service as Deputy Secretary for Unemployment Compensation Programs with the Department of Labor and Industry ( "L &I "), 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 Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. 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 new employer based upon the assumptions that you did not actively participate in recruiting the new employer to Pennsylvania, and that you did not actively participate in recruiting or inducing the new employer 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 of Pennsylvania. With regard to Section 1103(g), the restrictions as outlined above must be followed. The former governmental body is L &I in its entirety. The propriety of the proposed conduct has only been addressed under the Ethics Act. Further, should service be terminated, as outlined above, the Ethics Act would require that a Statement of Financial Interests be filed by no later than May 1 of the year after termination of service. 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