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HomeMy WebLinkAbout06-552 PrevoznikJohn C. Prevoznik, Esquire 47 South Courtland Street East Stroudsburg, PA 18301 Dear Mr. Prevoznik: ADVICE OF COUNSEL May 9, 2006 06 -552 This responds to your letter of March 29, 2006, 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 a township supervisor with regard to participating in actions regarding a subdivision /land development plan that would entail the township taking over a state road and the properties along the state road being subject to an outright purchase, easement purchase, or condemnation, when the supervisor or members of his immediate family own property along that state road. Facts: As Solicitor for Paradise Township ( "Township "), you seek an advisory from the State Ethics Commission on behalf of Dale Smallacombe ( "Smallacombe "), a Township Supervisor. You have submitted facts that may be fairly summarized as follows. An extensive subdivision land development has been filed with the Township by Mt. Airy #1, LLC ( "Mt Airy "). Mt. Airy is hoping to obtain a gambling license and utilize the Township property as a gaming house /casino /resort. As part of the overall land development plan, Mt. Airy has requested that the Township take over what is now a state road known as Woodland Road. You state that the takeover of Woodland Road would entail PennDOT transferring title to the road to the Township. This transfer would be done in conjunction with proposed road improvements and a long term maintenance agreement to be performed by Mt. Airy. You further state that properties along the current road would be subject to either an outright purchase, or easement purchase, by Mt. Airy, or possible condemnation by the Township. Smallacombe owns property along Woodland Road, which property will be subject to an outright purchase, easement purchase, or condemnation. Based upon the foregoing facts, you pose the following inquiries: You ask the following: Prevoznik/Smallacombe, 06 -552 May 9, 2006 Page 2 1. Whether Smallacombe may vote or take any action with regard to the Township accepting Woodland Road from PennDOT; 2. Whether Smallacombe would be permitted to participate in any discussion or vote with regard to improvements, condemnation or purchase of any property along Woodland Road in the event the Township agrees to take over the road; and 3. If the Township would not take over Woodland Road, but PennDOT would authorize either the condemnation or the outright purchase of any of the Smallacombe properties to allow Mt. Airy to improve the road, whether the Ethics Act would pose any prohibitions against Smallacombe reviewing the proposed road improvements; and 4. If Smallacombe or his family would be subject to either a purchase or condemnation of the lands by Mt. Airy, whether Smallacombe would be barred from reviewing any matter concerning Mt. Airy. 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. As Supervisor for Paradise Township, Smallacomb is a public official as that term is defined in the Ethics Act, and hence you are 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. Prevoznik/Smallacombe, 06 -552 May 9, 2006 Page 3 "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. "Immediate family." A parent, spouse, child, brother or sister. 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. 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. Prevoznik/Smallacombe, 06 -552 May 9, 2006 Page 4 In applying the above provisions of the Ethics Act to the instant matter, 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. However, the above statutory definition of "conflict" or "conflict of interest" includes two exclusions, hereinafter referred to as the "de minimis" exclusion and the "class /subclass exclusion." The de minimis exclusion precludes a finding of a conflict of interest as to an action having a de minimis (insignificant) economic impact. Thus, when a matter that would otherwise constitute a conflict of interest under the Ethics Act would have an insignificant economic impact, a conflict would not exist and Section 1103(a) of the Ethics Act would not be implicated. See, Kolb, Order 1322; Schweinsburq, Order 900. The de minimis exclusion would not apply since the facts in the instant matter involve the outright purchase, easement purchase, or condemnation of property owned by Smallacombe or a member of his immediate family, which actions would clearly result in a financial benefit that would not have an insignificant economic impact. In order for the class /subclass exclusion to apply, two criteria must be met: (1) the affected public official /public employee, immediate family member, or business with which the public official /public employee or immediate family member is associated must be a member of a class consisting of the general public or a true subclass consisting of more than one member; and (2) the public official /public employee, immediate family member, or business with which the public official /public employee or immediate family member is associated must be affected "to the same degree" (in no way differently) than the other members of the class /subclass. 65 Pa.C.S. § 1102; see, Kablack, Opinion 02 -003; Graham, Opinion 95 -002 (citing Van Rensler, Opinion 90- 017); Rubenstein, Opinion 01 -007. The first criterion of the exclusion is satisfied where the members of the proposed subclass are similarly situated as the result of relevant shared characteristics. The second criterion of the exclusion is satisfied where the individual /business in question and the other members of the class /subclass are reasonably affected to the same degree by the proposed action. Kablack, supra. Under the facts that you have submitted, it would appear that the correct identification of the subclass would be property owners along Woodland Road. However, it is impossible to determine with certainty whether the property values along Woodland Road would appreciate or depreciate as a result of Mt. Airy's proposed subdivision /land development. In the event that property values would appreciate, it is further impossible to determine to what extent Smallacombe or a member of his immediate family would be affected as compared to other property owners along Woodland Road. Therefore, based upon a factual insufficiency, only the following general guidance may be given. In response to your first question, if Smallacombe as an owner of property along Woodland Road would financially benefit as a result of an outright purchase, easement purchase or condemnation of properties along Woodland Road, he would have a conflict of interest under Section 1103(a) of the Ethics Act in participating in actions regarding such takeover assuming the class /subclass exclusion would not apply. In response to your second question, if Smallacombe as an owner of property along Woodland Road would financially benefit as a result of an outright purchase, easement purchase or condemnation of properties along Woodland Road, he would have a conflict of interest under Section 1103(a) of the Ethics Act in participating in any discussions or votes with regard to improvements, condemnation or purchase of property along Woodland Road assuming the class /subclass exclusion would not apply. In response to your third question, conditioned upon the assumption that there would be no use by Smallacombe of the authority of his office or confidential information Prevoznik/Smallacombe, 06 -552 May 9, 2006 Page 5 for a private pecuniary benefit of himself or a member of his immediate family, Smallacombe would not have a conflict of interest under Section 1103(a) of the Ethics Act in merely reviewing the proposed road improvements when such improvements would involve the condemnation or outright purchase of any of the Smallacombe properties. In response to your fourth question, if any properties owned by Smallacombe or members of his immediate family would be subject to purchase or condemnation by Mt. Airy, Smallacombe, as a Township Supervisor, would have a conflict of interest in participating in matters that would come before him that would financially impact Mt. Airy. See, Confidential Opinion, 06 -001. This conclusion is consistent with prior rulings in which the Commission has held that it is a conflict of interest under Section 1103(a) of the Ethics Act for a public official /public employee to use the authority of office or confidential information for the private pecuniary benefit of an individual(s) with whom he has an ongoing business relationship. See, Miller, Opinion 89 -024; Kannebecker, Opinion 92 -010. In each instance of a conflict of interest, Smallacombe would be required to abstain and to observe the disclosure requirements of Section 1103(j) of the Ethics Act. 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 Second Class Township Code. Conclusion: As a Supervisor for Paradise Township ( "Township "), Smallacombe is a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. Assuming the class /subclass exclusion to the definition of `conflict" or "conflict of interest" would not apply, Smallacombe would have a conflict of interest under Section 1103(a) of the Ethics Act in participating in actions regarding the takeover of Woodland Road, and participating in any discussions or votes with regard to the improvements, condemnation or purchase of property along Woodland Road if Smallacombe as an owner of property along Woodland Road would financially benefit as a result such actions. Conditioned upon the assumption that there would be no use by Smallacombe of the authority of his office or confidential information for a private pecuniary benefit of himself or a member of his immediate family, Smallacombe would not have a conflict of interest under Section 1103(a) of the Ethics Act in merely reviewing the proposed road improvements when such improvements would involve the condemnation or outright purchase of any of the Smallacombe properties. If any properties owned by Smallacombe or members of his immediate family would be subject to purchase or condemnation by Mt. Airy, Smallacombe as a Township Supervisor, would have a conflict of interest in participating in matters that would come before him that would financially impact Mt. Airy. 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. Prevoznik/Smallacombe, 06 -552 May 9, 2006 Page 6 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