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HomeMy WebLinkAbout05-586 BuntingRedding Bunting 71 Woodvale Street Dunbar, PA 15431 Dear Mr. Bunting: ADVICE OF COUNSEL October 24, 2005 05 -586 Re: Conflict; Public Official /Employee; Assistant Secretary- Treasurer of Municipal Authority; Applicant; Distribution Manager for the Authority; Bassi, Opinion 86- 007-R; Woodrinq, Opinion 90 -001. This responds to your letter of September 21, 2005, 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 prohibition or restrictions upon an assistant secretary /treasurer for a municipal authority with regard to participating in the hiring of a distribution manager for the authority. Facts: As Assistant Secretary- Treasurer of the Board of Directors of the North Fayette County Municipal Authority ("Authority"), you seek an advisory from the State Ethics Commission based upon the following submitted facts. The Authority is currently requesting applications for the position of Distribution Manager. You state that the Authority will publicize the vacancy in the local newspaper and with PA Career Links. After the General Manager and Distribution Manager of the Authority screen the applicants and agree on five prospective candidates, the Personnel Committee will interview those five candidates and administer a test to each one. The results of the test and the interview will determine which three of the five candidates will be presented to the Board for consideration. Prior to presentation to the Board, the final three candidates will also undergo a physical, drug /alcohol screening and a criminal background check. You are interested in applying for the position of Distribution Manager. You seek guidance as to the prohibitions and restrictions that would apply to you during the hiring process. Bunting, 05 -586 October 24, 2005 Page 2 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. It is assumed for purposes of this advisory that as Assistant Secretary- Treasurer of the Board of Directors of the North Fayette County Municipal Authority (`Authority "), you are an Authority Board member, and thus, a public official subject to the provisions of the Ethics 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. 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. Bunting, 05 -586 October 24, 2005 Page 3 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. 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, Pavlovic, Opinion 02 -005. Pursuant to Section 1103(a) of the Ethics Act, a public official /public employee is prohibited from using the authority of public office /employment or confidential information received by holding such a public position for the private pecuniary 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. In applying the Ethics Act to the facts that you have submitted, you are advised that as Assistant Secretary- Treasurer of the Board of Directors of the Authority, you would be prohibited from participating in actions of the Board to hire for the position of Distribution Manager for the Authority when you are an applicant for the position. Davis, Opinion 89 -012. If you were to participate, such action would be a conflict of interest in contravention of Section 1103(a) of the Ethics Act because you would be using the authority of office for the private pecuniary benefit of yourself. A conflict would exist even as to making recommendations against or disapproving the other applicant(s) for the position when such action would assure or increase the possibility that the Board would hire you to the position of Distribution Manager for the Authority. See, Pepper, Opinion 87 -008. If you would be hired to the position, you would have a conflict of interest in the future as to employment issues pertaining to yourself individually such as Bunting, 05 -586 October 24, 2005 Page 4 your compensation, evaluation(s), raises and other matters that would financially impact you. Moreover, you would have a conflict of interest as to persons who would be involved in the hiring process and who would be subject to your power as an Authority Board Member to appoint or remove, including, but not limited to, the General Manager of the Authority. Should any matter arise before the Authority involving such persons or entities, you would have a conflict of interest as to such matter(s) based upon your pursuit of an employment position with the Authority. This conclusion is based upon the State Ethics Commission's rulings in Bassi, Opinion 86- 007 -R, Woodrinq, Opinion 90- 001, Elisco, Opinion 00 -003, and Confidential Opinion, 05 -004. In Bassi, Opinion 86- 007 -R, the State Ethics Commission held, inter alia, that a County Commissioner (Edward Paluso) could not enter into a lease with a municipal authority, where one of the members of the authority (Norman Carson) was a county employee directly responsible to the commissioners of the county, unless the execution of the lease was accomplished after an open and public process, with the authority member abstaining from participating in the review and award of said lease, and the county commissioner abstaining from participating in any matter relating to the authority member in his position as a county employee. The Commission stated, inter alia: . we cannot ignore the fact that Mr. Carson is an authority member and has influence and control over authority decisions. In this respect, Mr. Carson, by voting on the final adoption of a lease, would be voting on a matter directly related to his employer. Even though that employer is another governmental body, we have held, in the past, that a public official may not vote or participate in a matter if it somehow relates to a financial interest which he may have. See, Welz, 86 -001. In the instant situation, Mr. Carson would be called upon to determine the advisability of renting property for the authority. The property which they are seeking to rent is owned by the individual or one of the individuals who currently supervises him and controls his public employment with the county. As a result of this, Mr. Carson, as an authority member, should abstain from participating in any matter relating to this particular lease. See, Bassi, 86 -007 at 3. The Commission further stated: Mr. Paluso as a county commissioner, is, in part, responsible for the general supervision of Mr. Carson. Mr. Carson, on the other hand, is an authority member in a position to grant Mr. Paluso a lease which results in Mr. Paluso receiving a financial gain. It may be difficult for the public to perceive how Mr. Paluso's actions as a county official, would not somehow be influenced by this potential leasing arrangement. It may be argued that Mr. Paluso, in dealing with Mr. Carson, to date, has done so in order to effect the favorable outcome of this lease. Additionally, it could be argued that Mr. Carson voted in favor of the lease in order to advance his position as a full -time county employee. The above factual scenarios, while hypothetical in nature, nonetheless create the types of conflicts of interest that are to be addressed by this Commission. Id. at 4. In Woodrinq, Opinion 90 -001, the State Ethics Commission reviewed a similar situation. Jesse Woodring, Chairman of the Sunbury Redevelopment Authority, had applied to the City for a rehabilitation grant through the Federal Rental Rehabilitation Program (hereinafter, the "Program "). Kenneth Pick, who was employed as the Executive Director of the Redevelopment Authority (chaired by Woodring) also served as the Community Development Coordinator for Sunbury. In the latter capacity, Pick was administrator in charge of the Program for the City. Pick's functions included Bunting, 05 -586 October 24, 2005 Page 5 administering the Program, reviewing all applications, and determining eligibility. The Commission stated: . we are concerned that Mr. Pick, who is an employee of the Redevelopment Authority of which you are Chairman, has the duty of reviewing all applications and determining eligibility in his capacity as Community Development Coordinator for the city. In particular, the potential exists, given the employer - employee relationship between the Redevelopment Authority and Mr. Pick, that your application might be reviewed in a more favorable light than other applications. To forestall such a situation, you must not participate or take any action as to Mr. Pick if your application is approved and you receive benefits. Bassi, Opinion 86 -007. In addition, Section 3(j) of the Ethics Law would require you to publicly note that you would have a conflict as to any matter involving Mr. Pick. In addition, you must file a written memorandum to that effect with the person responsible for recording the minutes. Woodrinq, Opinion 90 -001 at 6. In Elisco, Opinion 00 -003, the Commission similarly held that where a City Council Member was an Assistant Principal and another City Council Member's spouse was a Principal in a certain School District, both Council Members would have a conflict of interest with regard to voting to invest pension funds through an investment company and its sales representative who was a School Director in that School District. In Confidential Opinion, 05 -004, the Commission held that a school director would have a conflict of interest pursuant to Section 1103(a) of the Ethics Act in matters pertaining to the appointment /employment of a middle school principal for the school district when one of the candidates for the position exercised some administrative authority and influence over the school director as to the latter's employment as a teacher in a different school district. Thus, based upon the rulings discussed above, you would have a conflict of interest pursuant to Section 1103(a) of the Ethics Act in matters pertaining to those persons who would play a role in determining whether you would be hired by the Authority and who would be subject to your power as an Authority Board Member to appoint or remove. In each instance of a conflict of interest, you would be required to abstain fully and to satisfy the disclosure requirements of Section 1103(j) set forth above. 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 the respective municipal code. Conclusion: As Assistant Secretary- Treasurer of the Board of Directors of the North Fayette County 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. You would be prohibited from participating in actions of the Board to hire for the position of Distribution Manager for the Authority when you are an applicant plicant for the position. If you were to participate, such action would be a conflict of in contravention of Section 1103(a) of the Ethics Act because you would be using the authority of office for the private pecuniary benefit of yourself. A conflict would exist even as to making recommendations against or disapproving the other applicant(s) for the position when such action would assure or increase the possibility that the Board Bunting, 05 -586 October 24, 2005 Page 6 would hire you to the position of Distribution Manager for the Authority. If you would be hired to the position, you would have a conflict of interest in the future as to employment issues pertaining to yourself individually such as your compensation, evaluation(s), raises and other matters that would financially impact you. Moreover, you would have a conflict of interest as to persons who would be involved in the hiring process and who would be subject to your power as an Authority Board Member to appoint or remove, including, but not limited to, the General Manager of the Authority. Should any matter arise before the Authority involving such persons or entities, you would have a conflict of interest as to such matter(s) based upon your pursuit of an employment position with the Authority. In each instance of a conflict of interest, you would be required to abstain fully and to satisfy the disclosure requirements of Section 1103(j) set forth above. 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 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. Sincerely, Vincent J. Dopko Chief Counsel