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HomeMy WebLinkAbout06-567 CONFIDENTIALADVICE OF COUNSEL June 13, 2006 06 -567 This responds to your letter of May 9, 2006 by which you requested a confidential advisory from the State Ethics Commission. Issue: Whether the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa. .S. § 1101 et seq., would present any restrictions upon employment of an A following termination of service with Commonwealth Agency B, specifically with regard to applying for or accepting employment with one or more entities that have received funding through Authority B ("Authority"), where the A has had: (1) significant nonministerial duties with regard to grants awarded by the Authority; and (2) interaction with such entities in the course of performing the duties of an A. Facts: You seek an advisory from the State Ethics Commission regarding the post- employment restrictions of the Ethics Act. You have submitted facts that may be fairly summarized as follows. You are currently employed as an A for Commonwealth Agency B. You have submitted a copy of your position description, which document is incorporated herein by reference. You have also submitted copies of an organizational chart, overview of your office, a listing of the Authority Board Members, and certain program guidelines pertaining to the work of the Authority. Per your position description, the primary purpose of your position is to perform lead work in the oversight and direction of all aspects of the day -to -day administration of Grant Fund C and Partnership D; as well as collaborate in the administration of all other E programs. It is specifically noted that you have significant nonministerial duties with respect to grants awarded by the Authority, including but not limited to recommending grant applications for presentation to the Authority for funding approval. Based upon the facts that you have submitted, you ask whether you would be permitted to apply for or accept employment with one or more entities that received funding through the Authority if you had interaction with such entity(ies) in your capacity as an A for Commonwealth Agency B. 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 Confidential Advice, 06 -567 June 13, 2006 Page 2 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 further initially noted that, pursuant to the same aforesaid Sections of the Ethics Act, an opinion /advice may be given only as to prospective (future) conduct. If the activity in question has already occurred, the Commission may not issue an opinion /advice but any person may then submit a signed and sworn complaint, which will be investigated by the Commission if there are allegations of Ethics Act violations by a person who is subject to the Ethics Act. To the extent you have inquired as to conduct that has already occurred, such past conduct may not be addressed in the context of an advisory opinion. However, to the extent you have inquired as to future conduct, your inquiry may, and shall be addressed. As an A for Commonwealth Agency B, you would be considered a public official /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. 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 pertaining to conflicts of interest under the Ethics Act are defined as follows: 65 Pa.C.S. § 1102. § 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. Confidential Advice, 06 -567 June 13, 2006 Page 3 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. Section 1103(a) of the Ethics Act would prohibit you from using your public position or confidential information received by being in your public position to advance an opportunity of private employment. It is not suggested that you have engaged in such conduct, and as noted above, past conduct may not be addressed within the context of this advisory. You are advised that conditioned upon the assumption that there has been no use of the authority of your public position or confidential information received by being in such position to advance the prospects of obtaining a position with the entity(ies) in question, your acceptance of employment with such entity(ies) would not transgress Section 1103(a) of the Ethics Act. In addition, 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. Upon termination of public service, you would become 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 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 conditions. The State Ethics Commission has interpreted the terms "actively participates" and "actively participated" to mean to take part through an actual exercise of power or discretion, and not mere presence or passive involvement through the non - discretionary performance of a perfunctory function. See, Confidential Opinion, 94 -011 at 12. The restrictions of Section 1103(i) apply even Confidential Advice, 06 -567 June 13, 2006 Page 4 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, 94 -011, supra. You are advised that Section 1103(i) of the Ethics Act would prohibit you from being employed by, receiving compensation from, assisting, or acting in a representative capacity for any business or corporation that you actively participated in recruiting to Pennsylvania, or that you actively participated in inducing 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 such entity. 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. Confidential Advice, 06 -567 June 13, 2006 Page 5 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 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 would be deemed to have been associated upon termination of public service would be Commonwealth Agency B in its entirety. Therefore, for the first year after termination of your service with Commonwealth Agency B, Section 1103(g) of the Ethics Act would apply and restrict "representation" of "persons" before Commonwealth Agency B. 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 F. Conclusion: As an A for Commonwealth Agency B, you would be considered a public official /public employee and an "executive -level State employee" subject to the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq., and the Regulations of the State Ethics Commission. In response to the question of whether the Ethics Act would present any restrictions upon your employment following termination of Confidential Advice, 06 -567 June 13, 2006 Page 6 service with Commonwealth Agency B, specifically with regard to applying for or accepting employment with one or more entities that have received funding through Authority B ( "Authority "), where you have had: (1) significant nonministerial duties with regard to grants awarded by the Authority; and (2) interaction with such entities in the course of performing the duties of an A, you are advised as follows. Conditioned upon the assumption that there has been no use of the authority of your public position or confidential information received by being in such position to advance the prospect of obtaining a position with the entity(ies) in question, your acceptance of employment with such entity(ies) would not transgress Section 1103(a) of the Ethics Act. Upon termination of service as an A for Commonwealth Agency B, you would become 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 Ethics Act. Section 1103(i) of the Ethics Act would prohibit you from being employed by, receiving compensation from, assisting, or acting in a representative capacity for any business or corporation that you actively participated in recruiting to Pennsylvania, or that you actively participated in inducing 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 such entity. With regard to Section 1103(g), the restrictions as outlined above must be followed. The former governmental body would be Commonwealth Agency B in its entirety. Act. The propriety of the proposed conduct has only been addressed under the Ethics 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 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