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HomeMy WebLinkAbout26-2002 PoliPHONE:717-783-1610 STATE ETHICS COMMISSION FACSIMILE:717-787-0806 TOLL FREE: 1-800-932-0936 FINANCE BUILDING wEBSITE: www.ethics.12a.gov 613 NORTH STREET, ROOM 309 HARRISBURG, PA 17120-0400 DETERMINATION OF THE COMMISSION Before; Michael A. Schwartz, Chair David L. ReddecIiff, Vice Chair Paul E. Parsells Robert P. Caruso Emilia McKee Vassallo DATE DECIDED: 10/15/26 DATE MAILED: 10/16/26 To the Requester: John Eric Poli Dear Mr. Poli: 26-2002 This is in response to your letter received July 27, 2026, by which you requested a determination from this Commission pursuant to Section 1512(a.5)(1) of the Pennsylvania Race Horse Development and Gaming Act ("Gaming Act"), 4 Pa.C.S. § 1512(a.5)(1). I. ISSUE: Whether the Requester's service as Tax Collector for Hughestown Borough in Luzerne County, Pennsylvania, would bring him within the definition of the term "public official" set forth in Section 1512(b) of the Gaming Act, 4 Pa.C.S. § 1512(b), and therefore cause him to be subject to the restrictions of Section 1512(a.1) of the Gaming Act, 4 Pa.C.S. § 1512(a.1). II. FACTUAL BASIS FOR DETERMINATION: This determination is based upon the following submitted and administratively noted facts. You have been employed as a barback with Mohegan Pennsylvania Casino Resort in Wilkes Barre, Luzerne County, Pennsylvania, since June 2012. Your duties as a barback include assisting bartenders and beverage servers with preparing drinks and ensuring that the bars are stocked with the correct products. As a barback, you are registered as a nongaming employee with the Pennsylvania Gaming Control Board ("Gaming Control Board"). In November 2021, you were elected as an Auditor for Hughestown Borough, Luzerne County, as a result of receiving write-in votes. On January 8, 2025, you submitted an application for renewal of your nongaming employee registration to the Gaming Control Board. Poli, 26-2002 October IS, 2026 Page 2 During the renewal application process, a concern was raised as to whether, as an elected Hughestown Borough official, you would be considered a "public official" under the Gaming Act's definition of that term. At the request of the Gaming Control Board, you sought a determination from this Commission as to whether your service as an Auditor for Hughestown Borough brought you within the definition of the term "public official" set forth in Section 1512(b) of the Gaming Act and therefore caused you to be subject to the restrictions of Section 1512(a.1) of the Gaming Act. In Pali, Determination 25-2001, issued July 24, 2025, we determined that your service as an Auditor for Hughestown Borough brought you within the definition of the term "public official" set forth in Section 1512(b) of the Gaming Act. We initially tools administrative notice of the following facts: Pursuant to Sections 13A63 and 1403 of the Gaming Act, 4 Pa.C.S. §§ 13A63, 1403, licensed casinos must pay a local share assessment levied against revenue generated by gaming, which the Commonwealth collects and distributes to counties and municipalities to mitigate the impact of gaming and related activities. All counties and municipalities that receive distributions of local share assessments are required to submit information to the Pennsylvania Department of Community and Economic Development ("DCED") identifying the amount and use of the fiinds received. DCED is required to submit an annual report to various Iegislative committees on all distributions of local share assessments to counties and municipalities. The 2024 Local Share Funds Annual Report issued by DCED provides that Hughestown Borough received a distribution of local share assessments totaling $11,708 in 2024. Local Share Funds Annual Reports issued by DCED for prior years further reflect that Hughestown Borough received distributions of local share assessments totaling $500,000 in 2015, $100,000 in 2017, and $115,000 in 2020. Poli, Determination 25-2001, at 2. In rendering our determination, we quoted the definition of the term "public official" set forth in Section 1512(b) of the Gaming Act, which includes in paragraph 3 of the definition "an individual elected or appointed to any office of a county or municipality that directly receives a distribution of revenue under [the Gaming Act]." 4 Pa.C.S. § 1512(b), para. 3. We noted that as an elected Auditor for Hughestown Borough, you were an individual elected to all office of a municipality. Based upon the above administratively noted facts, we found that Hughestown Borough is a direct recipient of distributions of revenue under the local share assessment system established by the Gaming Act. We concluded that paragraph 3 of the definition was applicable to you, and accordingly we determined that as an Auditor for Hughestown Borough, you were a "public official" as the Gaming Act defines that term, and therefore you were subject to the restrictions of Section 1512(a.1) of the Gaming Act. Poti, 26-2002 October 15, 2026 Page 3 In August 2025, your father, who was serving as the Tax Collector for Hughestown Borough, passed away. You subsequently resigned from your position as an Auditor and were appointed by Hughestown Borough Council to serve as Tax Collector. In your role as Tax Collector, you collect county, municipal, and school taxes for Hughestown Borough and keep records of the payments. You have no governing power as all governing decisions are made by the Mayor and Council of Hughestown Borough. You now seek a determination from this Commission as to whether your current service as Tax Collector for Hughestown Borough would bring you within the definition of the term "public official" set forth in Section 1512(b) of the Gaming Act and therefore cause you to be subject to the restrictions of Section 1512(a.1) of the Gaming Act. At our request, Stephen Cook, Chief Counsel of the Gaming Control Board, and Maximilian Flessner, Esquire, Director of Legislative Affairs for the Gaming Control Board, provided additional facts regarding the distribution of gaming revenues under the provisions of the Gaming Act. These additional facts may be fairly summarized as follows. For the intended purpose of offsetting the local impacts of casino operations, such as increased traffic, additional demands on emergency services, and wear and tear on infrastructure, counties and municipalities that host casino facilities regularly receive funds directly from local share assessments imposed on the gaming revenues generated by those casino facilities. Depending upon the classification of the county, these funds are either distributed by statutory formula to county government authorities and local municipalities or managed through the Commonwealth Financing Authority ("CFA"), Counties and municipalities that do not host a casino facility do not automatically receive distributions of gaming revenues. Instead, those counties and municipalities may seek grants for projects through the Local Share Account ("LSA") program that was established as a result of the passage of the Gaming Act, which mandates that a portion of all gaming revenues be distributed regularly to support projects in the public interest. The LSA program is managed by a number of entities, including the Pennsylvania Department of Community and Economic Development and the CFA. All counties and municipalities in Pennsylvania may seek grants for projects through Local Share Account — Statewide ("LSA Statewide"), which distributes gaming revenues through the CFA to support projects in the public interest within the Commonwealth. Eligible applicants for LSA — Statewide grants include counties, municipalities, municipal authorities, and other public entities. Nonprofit organizations may benefit from LSA — Statewide grants through partnering with an eligible public entity to act as the official applicant and sponsor for the project. The process for awarding LSA ---- Statewide grants is highly competitive, with applicants competing to win approval from the CFA to secure funding for projects throughout the Commonwealth. LSA — Statewide grants are available for projects with a total eligible cost of at least $25,000, with grant requests capped at a maximum of $1 million per project. In addition to being eligible to seek funding for projects through LSA ---- Statewide, some counties and municipalities are eligible to seek fiends for projects through other LSAs under the statutory distribution framework established by the Gaming Act. These LSAs are also Lori, 26-2002 October 15, 2026 Page a administered by the CFA. There are separate LSAs for certain counties, including Fayette, Luzerne, Monroe, Montgomery, Philadelphia, and Washington Counties. Each LSA has its own program guidelines for eligible applicants and purposes for which funds maybe used. Tn pertinent paid, municipalities located in Luzerne County, such as Hughestown Borough, may apply for grants for projects through LSA — Luzerne County, which distributes gaming revenues from licensed facilities in Luzerne County to support projects in the public interest within Luzerne County, The CFA reviews, evaluates, and approves applications for grants from LSA — Luzerne County. 111. DISCUSSION: It is initially noted that determinations under Section 1512(a.5)(1) of the Gaming Act are issued by the Commission to the requester based upon the facts that the requester has submitted. In issuing the determination based upon the facts that the requester has submitted, this 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. Id. A determination only affords a defense to the extent the requester has truthfully disclosed all of the material facts. Id. Section 1512(b) of the Gaming Act defines the term "public official" as follows: "Public Official." —The term shall include the following: (1) The Governor, Lieutenant Governor, a member of the Governor's cabinet, Treasurer, Auditor General and Attorney General of the Commonwealth. (2) A member of the Senate or House of Representatives of the Commonwealth. (3) An individual elected or appointed to any office of a county or municipality that directly receives a distribution of revenue udder this part. (4) An individual elected or appointed to a department, agency, board, commission, authority or other governmental body not included in paragraph (1), (2) or (3) that directly receives a distribution of revenue under this part. (5) An individual elected or appointed to a department, agency, board, commission, authority, county, municipality or other governmental body not included in paragraph (1), (2) or (3) with discretionary power which may influence or affect the outcome of an action or decision and who is involved in the development of regulation or policy relating to a licensed entity or who is involved in other matters under this part. Poll, 26-2002 October 15, 2026 Page 5 This term does not include a member of a school board or an individual who held an uncompensated office with a governmental body prior to January 1, 2006, and who no longer holds the office as of January 1, 2006. The terra includes a member of an advisory board or commission which makes recommendations relating to a licensed facility. 4 Pa,C.S. § 1512(b). In considering the paragraphs of the above definition of the term "public official," it is clear that: (1) paragraphs 1 and 2 would not apply to you because they list particular positions that you do not hold; (2) paragraph 4 would not apply to you because you are not elected or appointed to a department, agency, board, commission, authority, or other governmental body; and (3) paragraph 5 would not apply to you because the Tax Collector of Hughestown Borough would not be involved in the development of regulation or policy relating to a licensed entity or other matters under the Gaming Act. Accordingly, you would not be a "public official" under the Gaming Act unless paragraph 3 of the above definition of the term "public official" would apply to you, which hinges upon whether Hughestown Borough "directly receives a distribution of revenue" under the Gaming Act. It is clear that Hughestown Borough at times receives distributions of revenue under the Gaming Act. The issue to be determined is whether Hughestown Borough "directly" receives those distributions. The Gaming Act does not define the term "directly" or the phrase "directly receives." Additionally, there do not appear to be any applicable judicial decisions defining the term "directly" or the phrase "directly receives." We slrall therefore consider the common and approved usage of the term "directly" (see, 1 Pa.C.S. § 1903). The Cambridge Dictionary provides various definitions of the term "directly," of which the following is the most applicable: "without anything else being involved or in between."' The Collins Dictionary similarly defines the term "directly" as "with nothing or no one in between." z Upon review of the additional facts that were not available to us when we decided Poli, Determination 25-2001, it is our view that in receiving grants through the LSA prograrn (i.e., LSA — Statewide or LSA ---- Luzerne), Hughestown Borough does not "directly receive" a distribution of revenue under the Gaming Act. Unlike host counties and municipalities, which automatically regularly receive Rinds directly from local share assessments imposed on the gaming revenues generated by casinos located within their geographic boundaries based upon a distribution scheme established by the Gaming Act, public entities that apply for grants through the LSA program are not guaranteed to receive any grant funds derived from gaming revenues. Instead, an intermediary — the CFA --- controls the flow of gaming revenues under the LSA program by determining which applicants will receive grant funds derived from gaming revenues. Because of the CFA's involvement in between the collection of gaming revenues and their distribution to applicants, an applicant that receives gaming revenues through the LSA program does not "directly" receive the gaming revenues under the framework of the Gaming Act. Additionally, because the verb form used in the please "directly receives a distribution of revenue under [the Gaming Act]" is the ' Cambridge Dictionary, httt)s://dictionary.cambridge.orOtis/dictionart:y/englisli/dit-c tx (last visited October 1, 2026). 2 Collins Dictionary, https://www.coIliiisclictionary.com/ns/dictionary/englisli/directly (last visited October 1, 2026). Ed, 26-2002 October 15, 2026 Page 6 simple present tense, which is used in pertinent part to express unchanging situations or scheduled events in the future, the phrase describes gaming revenues that are received regularly pursuant to the mandates of the Gaming Act rather than gaming revenues that may be received occasionally through the LSA program. Because Hughestown Borough receives gaming revenues through the LSA program rather than as a host municipality of a casino, you are not "an individual who is elected or appointed to any office of a county or municipality that directly receives a distribution of revenue" under the Gaming Act. Accordingly, the necessary determination of this Commission is that based upon the submitted and administratively noted facts, your service as Tax Collector for Hughestown Borough, Luzern County, Pennsylvania, would not bring you within the definition of the term "public official" set forth in Section 1512(b) of the Gaming Act, and therefore would not cause you to be subject to the restrictions of Section 1512(a.1) of the Gaming Act. Poli, Determination 25-2001, is overruled to the extent it is inconsistent with our determination in this matter. This determination is limited to addressing the specific question posed under Section 1512(a.5)(1) of the Gaming Act. IV. CONCLUSION: Based upon the submitted and administratively noted facts, your service as Tax Collector for Hughestown Borough, Luzerne County, Pennsylvania, would not bring you within the definition of the term "public official" as set forth in Section 1512(b) of the Pennsylvania Race Horse Development and Gaining Act ("Gaining Act"), 4 Pa.C.S. § 1512(b), and therefore would not cause you to be subject to the restrictions of Section 1512(a.1) of the Gaming Act, 4 Pa.C.S. § 1512(a.1). Pali, Determination 25-2001, is overruled to the extent it is inconsistent with our determination in this matter. An individual who relies in good faith on a determination issued by this Commission as to such individual pursuant to Section 1512(a.5)(1) of the Gaming Act shall not be subject to any penalty for an action taken in reliance on the determination, provided that all material facts are accurately set forth in the request for a determination. This determination is a public record and will be made available as such. By the Commission, fix rchael Sc, artz� Chair