HomeMy WebLinkAbout06-554 CONFIDENTIAL ADVICEADVICE OF COUNSEL
May 10, 2006
06 -554
This responds to your letter of March 24, 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 municipal water
authority board member who is an independent contractor for the authority's consulting
engineer with regard to participating in matters involving the consulting engineer and
performing inspection work for the consulting engineer on water lines in the authority's
system.
Facts: As Solicitor for the A Authority, you seek a confidential advisory on behalf
of B, an Authority Board Member. You have submitted facts, the material portions of
which may be fairly summarized as follows.
The A Authority operates a municipal water system in C County. The A Authority
utilizes D as its consultant engineer. B is retired, but works on a part -time basis as an
independent contractor for D inspecting the installation of water and sanitary sewer
lines. You state that B has no financial interest in D.
Based upon the foregoing facts, you pose the following inquiries:
1. Whether B would be prohibited from voting on Authority matters involving D, in
particular, the annual appointment of the consulting engineer if that position is to be
filled by D, monthly invoices payable to the engineer, and authorization for D to perform
certain engineering services; and
2. Whether B would be prohibited from continuing to perform inspection work for D
when such work involves inspection of water lines being installed for the Authority's
system.
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
Confidential Advice, 06 -554
May 10, 2006
Page 2
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 an Authority Board Member, B is a public official as that term is defined in the
Ethics Act, and hence he 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.
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
Confidential Advice, 06 -554
May 10, 2006
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 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.
In addition to the above provisions of the Ethics Act, administrative notice is
taken as to Section 5614(e) of the Municipality Authorities Act, which provides, in
pertinent part, as follows:
§5614. Competition in award of contracts
(e) No member of the authority or officer or employee of
the authority may directly or indirectly be a party to or be
interested in any contract or agreement with the authority if
the contract or agreement establishes liability against or
indebtedness of the authority. Any contract or agreement
made in violation of this subsection is void, and no action
may be maintained on the agreement against the authority.
53 Pa.C.S. § 5614(e).
In applying the above provisions of the Ethics Act to the instant matter, it is noted
that Section 1103(a) of the Ethics Act 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
Confidential Advice, 06 -554
May 10, 2006
Page 4
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), or private
customer(s)/client(s) (Miller, Opinion 89 -024; Kannebecker, Opinion 92 -010).
In Kannebecker, supra, the State Ethics Commission determined that a township
supervisor, who in his private capacity was an attorney, would have a conflict of interest
as to matters before the township involving ongoing clients or client(s) for whom he
was on retainer, even if he would not represent such client(s) as to the matter pending
before the township. The Commission determined that as a general rule, a conflict
would not exist as to former client(s), but that under certain circumstances, a conflict
could exist as to former client(s) depending upon factors such as the number of prior
representations of the given client and the period of time over which such occurred.
In response to your first question, you are advised that B would have a conflict of
interest with regard to voting on Authority matters involving D, in particular, the annual
appointment of the consulting engineer if that position is to be filled by D, monthly
invoices payable to the engineer, and authorization for D to perform certain engineering
services based upon his current business relationship with D. Miller, supra;
Kannebecker, supra.
In response to your second inquiry, the Ethics Act would not prohibit B from
continuing to perform inspection work for D when such work involves inspection of water
lines being installed for the Authority's system. However, as noted above, due to the
business relationship that exists between B and D, B as an Authority Board Member
would have a conflict of interest in participating in matters pertaining to D including, but
not limited to, approving monthly invoices payable to D and authorization by the Board
for D to perform inspection work. B would also have a conflict of interest as to
participating in matters pertaining to water lines that he privately inspected.
In each instance of a conflict, B would be required to abstain and to fully satisfy
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 Municipality Authorities Act. It is recommended that B obtain legal advice regarding
Section 5614(e) of the Municipality Authorities Act, 53 Pa.C.S. § 5614(e).
Conclusion: As an Authority Board Member for A Authority, B 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. A business relationship exists between B and the Authority's
consulting engineer, D due to the fact that B is an independent contractor for D. B
would have a conflict of interest with regard to voting on Authority matters involving D, in
particular, the annual appointment of the consulting engineer if that position is to be
filled by D, monthly invoices payable to the engineer, and authorization for D to perform
certain engineering services based upon his current business relationship with D. The
Ethics Act would not prohibit B from continuing to perform inspection work for D when
such work involves inspection of water lines being installed for the Authority's system.
However, due to the business relationship that exists between B and D, B as an
Authority Board Member would have a conflict of interest in participating in matters
pertaining to D including, but not limited to, approving monthly invoices payable to D
Confidential Advice, 06 -554
May 10, 2006
Page 5
and authorization by the Board for D to perform inspection work. B would also have a
conflict of interest as to participating in matters pertaining to water lines that he privately
inspected. In each instance of a conflict, B 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.
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