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HomeMy WebLinkAbout07-504 BIANCODavid F. Bianco, Esquire Fields and Bianco 707 Main Street P.O. Box 84 Forest City, PA 18421 Dear Mr. Bianco: ADVICE OF COUNSEL January 26, 2007 07 -504 This responds to your letters of December 14, 2006, and December 21, 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., would impose any prohibitions or restrictions upon a borough zoning officer /building permit officer with regard to continuing to serve in his official capacity where the zoning officer /building permit officer is a fifty percent owner of a limited liability corporation that is subdividing a large tract of land in the borough. Facts: You are the Solicitor for Vandling Borough ( "Borough ") in Lackawanna ounty. You have been authorized by the individual who serves in the dual capacity of Borough Zoning Officer and Borough Building Permit Officer ( "Zoning /Building Permit Officer') to request an advisory from the State Ethics Commission as to the following. The Zoning /Building Permit Officer has acquired a fifty percent ownership share in a limited liability corporation (the "Corporation ") that owns a large tract of land within the Borough limits. This tract of land is the subject of a subdivision that will result in forty to fifty building lots. You ask whether the Ethics Act would permit the Zoning /Building Permit Officer to continue to serve in his official capacities despite his ownership share in the Corporation. You state that it is the Zoning /Building Permit Officer's opinion that he may do so because the subdivision being performed by the Corporation will be complete and approved prior to his becoming involved in either official capacity. 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 Bianco, 07 -504 January 26, 2007 Page 2 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. The Borough Zoning /Building Permit Officer is a public official /public employee subject to the provisions of the Ethics Act. Sections 1103(a) and 1103(j) of the Ethics Act provide: § 1103. Restricted activities (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. (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(a), (j). 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. Bianco, 07 -504 January 26, 2007 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. "Business." Any corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self - employed individual, holding company, joint stock company, receivership, trust or any legal entity organized for profit. "Business with which he is associated." Any business in which the person or a member of the person's immediate family is a director, officer, owner, employee or has a financial interest. "Financial interest." Any financial interest in a legal entity engaged in business for profit which comprises more than 5% of the equity of the business or more than 5% of the assets of the economic interest in indebtedness. 65 Pa. C. S. § 1102. 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 above provisions of the Ethics Act to the instant matter, it is noted that Section 1103(a) of the Ethics Act pertaining to conflicts of interest 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 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 or private client(s). Miller, Opinion 89- 024; Kannebecker, Opinion 92 -010. If a private employer or business with which the public official /public employee is associated or a client of the private employer or business would have a matter pending before the governmental body, the public official /public employee would have a conflict of interest as to such matter. Miller, supra; Kannebecker, supra. Pursuant to Section 1103(j) of the Ethics Act, in each instance of a conflict of interest, the public official /public employee would be required to abstain from participation and to publicly disclose the abstention and the reasons for same, both orally and by filing a written memorandum to that effect with the person recording the minutes or supervisor. The abstention requirement would not be limited merely to voting, but would extend to any use of authority of office including, but not limited to, discussing, conferring with others, and lobbying for a particular result. Juliante, Order 809. Bianco, 07 -504 January 26, 2007 Page 4 In applying the above provisions of the Ethics Act to your specific inquiry, you are advised as follows. Given that the Zoning /Building Permit Officer owns fifty - percent of the Corporation, the Corporation is a business with which the Zoning/Building Permit Officer is associated. Section 1103(a) of the Ethics Act would not prohibit the Zoning /Building Permit Officer from continuing to serve in his official capacities with the Borough merely because of his part- ownership of the Corporation or the Corporation's development of a large tract of land within the Borough limits. However, pursuant to Section 1103(a) of the Ethics Act, the Zoning /Building Permit Officer would generally have a conflict of interest in matters that would involve the Corporation, and he would specifically have a conflict of interest in matters pertaining to the tract of land being developed by the Corporation. See, Miller, supra; Kannebecker, supra. In each instance of a conflict of interest, the Zoning /Building Permit Officer would be required to abstain from participation in his official capacities and to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. The submitted facts do not indicate whether there is a pre- existing mechanism in place for delegation of the Zoning /Building Permit Officer's authority in the event of a conflict. If there is no pre- existing mechanism in place specifying how and by whom the Zoning /Building Permit Officer's authority should be exercised in the event of a conflict, the Zoning /Building Permit Officer would be prohibited under Section 1103(a) of the Ethics Act from participating in designating a subordinate to act in his stead as to matters involving the Corporation or the tract of land being developed by the Corporation. See, Confidential Opinion, 02 -004. 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 Borough Code. Conclusion: The Zoning Officer /Building Permit Officer ( "Zoning /Building Permit Officer ") for Vandling Borough ( "Borough ") is a public official/ public employee subject to the provisions of the Public Official and Employee Ethics Act "Ethics Act "), 65 Pa.C.S. § 1101 et seq. A limited liability corporation (the "Corporation ") in which the Zoning/ Building Permit Officer has a fifty percent ownership share would be considered a business with which the Zoning /Building Permit Officer is associated. Section 1103(a) of the Ethics Act would not prohibit the Zoning /Building Permit Officer from continuing to serve in his official capacities with the Borough merely because of his part- ownership of the Corporation or the Corporation's development of a large tract of land within the Borough limits. However, pursuant to Section 1103(a) of the Ethics Act, the Zoning /Building Permit Officer would generally have a conflict of interest in matters that would involve the Corporation, and he would specifically have a conflict of interest in matters pertaining to the tract of land being developed by the Corporation. In each instance of a conflict of interest, the Zoning /Building Permit Officer would be required to abstain from participation in his official capacities and to satisfy the disclosure requirements of Section 1103(j) of the Ethics Act. In the absence of a pre- existing mechanism in place specifying how and by whom the Zoning /Building Permit Officer's authority should be exercised in the event of a conflict, the Zoning /Building Permit Officer would be prohibited under Section 1103(a) of the Ethics Act from participating in designating a subordinate to act in his stead as to matters involving the Corporation or the tract of land being developed by the Corporation. Lastly, the propriety of the proposed conduct has only been addressed under the Ethics Act. Bianco, 07 -504 January 26, 2007 Page 5 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, Robin M. Hittie Chief Counsel