PRIOR PRINTER'S NO. 82 PRINTER'S NO. 211
No. 75 Session of 1989
INTRODUCED BY BLAUM, DeWEESE, O'DONNELL, BORTNER, KUKOVICH,
McHALE, CALTAGIRONE, ITKIN, HECKLER, MOEHLMANN, COWELL,
HAGARTY, VEON, HAYDEN, JOSEPHS, KOSINSKI, RITTER, PRESSMANN,
ARGALL, BATTISTO, BOWLEY, BUNT, BUSH, CAWLEY, COHEN,
COLAFELLA, COLAIZZO, DeLUCA, DIETTERICK, DORR, FARGO, FOX,
FREEMAN, HALUSKA, HASAY, HERMAN, JAROLIN, LaGROTTA,
LEVDANSKY, LINTON, MILLER, MICHLOVIC, MORRIS, MRKONIC,
MARKOSEK, PETRONE, PISTELLA, RUDY, RYBAK, SERAFINI,
D. W. SNYDER, STABACK, STUBAN, TANGRETTI, E. Z. TAYLOR,
TIGUE, VAN HORNE, WAMBACH, WOGAN, J. L. WRIGHT AND
CAPPABIANCA, JANUARY 24, 1989
AS REPORTED FROM COMMITTEE ON JUDICIARY, HOUSE OF
REPRESENTATIVES, AS AMENDED, FEBRUARY 1, 1989
AN ACT
1 Reenacting and amending the act of October 4, 1978 (P.L.883,
2 No.170), entitled "An act relating to conflicts of interest
3 involving certain public officials serving in State or State
4 agencies and local political subdivision positions and
5 prohibiting certain public employees from engaging in certain
6 conflict of interest activities requiring certain disclosures
7 and providing penalties," adding definitions; further
8 providing for the membership, powers and duties of the State
9 Ethics Commission and for persons who must file statements of
10 financial interests; reestablishing the State Ethics
11 Commission; and making an appropriation.
12 The General Assembly of the Commonwealth of Pennsylvania
13 hereby enacts as follows:
14 Section 1. The title and sections 1, 2, 3, 4, 5, 6, 7, 8, 9
15 and 10 of the act of October 4, 1978 (P.L.883, No.170), referred
16 to as the Public Official and Employee Ethics Law, are reenacted
17 and amended to read:
1 AN ACT
2 Relating to conflicts of interest involving certain public
3 officials serving in State or State agencies and local
4 political subdivision positions and prohibiting certain
5 public employees from engaging in certain conflict of
6 interest activities requiring certain disclosures and
7 providing penalties.
8 Section 1. Purpose.
9 (a) The Legislature hereby declares that public office is a
10 public trust and that any effort to realize personal financial
11 gain through public office other than compensation provided by
12 law is a violation of that trust. In order to strengthen the
13 faith and confidence of the people of the State in their
14 government, the Legislature further declares that the people
15 have a right to be assured that the financial interests of
16 holders of or nominees or candidates for public office do not
17 [present neither a conflict nor the appearance of a] conflict
18 with the public trust. Because public confidence in government
19 can best be sustained by assuring the people of the impartiality
20 and honesty of public officials, this act shall be liberally
21 construed to promote complete disclosure.
22 (b) It is the intent of the General Assembly that this act
23 be administered by an independent commission composed of members
24 who are cognizant of the responsibilities of public officials
25 and employees and who have demonstrated an interest in promoting
26 public confidence in government.
27 Section 2. Definitions.
28 The following words and phrases when used in this act shall
29 have, unless the context clearly indicates otherwise, the
30 meanings given to them in this section:
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1 "Advice." Any directive of the general counsel of the
2 commission issued under section 7(11) and based exclusively on
3 prior commission opinions, this act, regulations promulgated
4 pursuant to this act, and court opinions which interpret this
5 act.
6 "Authority of office or employment." The actual power
7 provided by law, the exercise of which is necessary to the
8 performance of duties and responsibilities unique to a
9 particular public office or position of public employment.
10 "Business." Any corporation, partnership, sole
11 proprietorship, firm, enterprise, franchise, association,
12 organization, self-employed individual, holding company, joint
13 stock company, receivership, trust or any legal entity organized
14 for profit.
15 "Business with which he is associated." Any business in
16 which the person or a member of the person's immediate family is
17 a director, officer, owner, employee or [holder of stock] has a
18 financial interest.
19 "Candidate." Any individual who seeks nomination or election
20 to public office by vote of the electorate, other than a judge
21 or inspector of elections, whether or not such individual is
22 nominated or elected. An individual shall be deemed to be
23 seeking nomination or election to such office if he has:
24 (1) received a contribution or made an expenditure or
25 given his consent for any other person or committee to
26 receive a contribution or make an expenditure for the purpose
27 of influencing his nomination or election to such office,
28 whether or not the individual has announced the specific
29 office for which he will seek nomination or election at the
30 time the contribution is received or the expenditure is made;
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1 or
2 (2) taken the action necessary under the laws of this
3 Commonwealth to qualify himself for nomination or election to
4 such office.
5 The term shall include individuals nominated or elected as
6 write-in candidates.
7 "Commission." The State Ethics Commission.
8 ["Compensation." Anything of economic value, however
9 designated, which is paid, loaned, granted, given, donated or
10 transferred, or to be paid, loaned, granted, given, donated or
11 transferred for or in consideration of personal services to any
12 person, official or to the State.]
13 "Conflict" or "conflict of interest." Use by a public
14 official or public employee of the authority of his office or
15 employment or any confidential information received through his
16 holding public office or employment for the private pecuniary
17 benefit or detriment of himself, a member of his immediate
18 family or a business with which he or a member of his immediate
19 family is associated. "Conflict" or "conflict of interest" does
20 not include an action having a de minimis economic impact or
21 which affects to the same degree a class consisting of the
22 general public or a subclass consisting of an industry,
23 occupation or other group which includes the public official or
24 public employee, a member of his immediate family or a business
25 with which he or a member of his immediate family is associated.
26 "Contract." An agreement or arrangement for the acquisition,
27 use or disposal by a State or political subdivision of
28 consulting or other services or of supplies, materials,
29 equipment, land or other personal or real property. "Contract"
30 shall not mean an agreement or arrangement between the State or
19890H0075B0211 - 4 -
1 political subdivision as one party and a public official or
2 public employee as the other party, concerning his expense,
3 reimbursement, salary, wage, retirement or other benefit, tenure
4 or other matters in consideration of his current public
5 employment with a State or political subdivision.
6 "De minimis economic impact." An economic consequence which
7 has an insignificant effect upon the public interest.
8 "Executive-level State employee." The Governor, Lieutenant
9 Governor, cabinet members, deputy secretaries, the Governor's
10 office staff, any State employee with discretionary powers which
11 may affect the outcome of a State agency's decision in relation
12 to a private corporation or business or any employee who by
13 virtue of his job function could influence the outcome of such a
14 decision.
15 "Financial interest." Any financial interest in a legal
16 entity engaged in business for profit which comprises more than
17 5% of the equity of the business or more than 5% of the assets
18 of the economic interest in indebtedness.
19 "Findings report." An initial report containing findings of
20 fact as determined by the commission's investigation but not
21 containing any conclusions of law or any determination of
22 whether there has been a violation of law.
23 "Frivolous complaint." A complaint filed in a grossly
24 negligent manner without basis in law or fact.
25 "Gift." [A payment, subscription, advance, forbearance,
26 rendering or deposit of money, services or anything of value,
27 unless consideration of equal or greater value is received]
28 Anything which is received without the exchange of consideration
29 of equal value. "Gift" shall not include a political
30 contribution otherwise reported as required by law[,] or a
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1 commercially reasonable loan made in the ordinary course of
2 business[, or a gift received from a member of the person's
3 immediate family or from a relative within the third degree of
4 consanguinity of the person or of the person's spouse or from
5 the spouse of any such relative].
6 "Governmental body." Any department, authority, commission,
7 committee, council, board, bureau, division, service, office,
8 officer, administration, legislative body, or other
9 establishment in the Executive, Legislative or Judicial Branch
10 of the State or a political subdivision thereof.
11 "Governmental body with which a public official or public
12 employee is or has been associated." The entity within State
13 government or a political subdivision by which the public
14 official or employee is or has been employed or to which the
15 public official or employee is or has been appointed or elected,
16 and not only the particular subdivision or office within that
17 entity to which the official or employee is or has been
18 assigned.
19 "Honorarium." Payment made in recognition of published
20 works, appearances, speeches and presentations and which is not
21 intended as consideration for the value of such services.
22 "Immediate family." [A spouse residing in the person's
23 household and minor dependent children] A parent, spouse, child,
24 brother, sister or like relative-in-law.
25 "Income." Any money or thing of value received, or to be
26 received as a claim on future services or in recognition of
27 services rendered in the past, whether in the form of a payment,
28 fee, salary, expense, allowance, forbearance, forgiveness,
29 interest, dividend, royalty, rent, capital gain, reward,
30 severance payment, proceeds from the sale of a financial
19890H0075B0211 - 6 -
1 interest in a corporation, professional corporation, partnership
2 or other entity resulting from termination or withdrawal
3 therefrom upon assumption of public office or employment or any
4 other form of recompense or any combination thereof. "Income"
5 refers to gross income and includes prize winnings and tax-
6 exempt income. The term does not include honoraria, gifts,
7 retirement, pension or annuity payments funded totally by
8 contributions of the public official or employee, or
9 miscellaneous, incidental income of minor dependent children.
10 "Indirect interest in real estate." Any business entity the
11 assets of which are 80% or more in real property.
12 "Ministerial action." An action that a person performs in a
13 prescribed manner in obedience to the mandate of legal
14 authority, without regard to, or the exercise of, the person's
15 own judgment as to the desirability of the action being taken.
16 "Nominee." Any person whose name has been submitted to a
17 public official or governmental body vested with the power to
18 finally confirm or reject proposed appointments to public office
19 or employment.
20 "Nonministerial actions." An action in which the person
21 exercises his own judgment as to the desirability of the action
22 taken.
23 "Opinion." A directive of the commission issued pursuant to
24 section 7(10) setting forth a public official's or public
25 employee's duties under this act.
26 "Order." A directive of the commission issued pursuant to
27 section 7(13) at the conclusion of an investigation which
28 contains findings of fact, conclusions of law and penalties.
29 "Person." A business, governmental body, individual,
30 corporation, union, association, firm, partnership, committee,
19890H0075B0211 - 7 -
1 club or other organization or group of persons.
2 "Political contribution." Any advance, conveyance, deposit,
3 distribution, transfer of funds, loan, payment, pledge, purchase
4 of a ticket to a testimonial or similar fund-raising affair, or
5 subscription of money or anything of value, except volunteer
6 services, in connection with a political campaign, and any
7 contract, agreement, promise, or other obligations, whether or
8 not legally enforceable, to make a political contribution.
9 "Political subdivision." Any county, city, borough,
10 incorporated town, township, school district, vocational school,
11 county institution district, and any authority, entity or body
12 organized by the aforementioned.
13 "Public employee." Any individual employed by the
14 Commonwealth or a political subdivision who is responsible for
15 taking or recommending official action of a nonministerial
16 nature with regard to:
17 (1) contracting or procurement;
18 (2) administering or monitoring grants or subsidies;
19 (3) planning or zoning;
20 (4) inspecting, licensing, regulating or auditing any
21 person; or
22 (5) any other activity where the official action has an
23 economic impact of greater than a de minimis nature on the
24 interests of any person.
25 "Public employee" shall not include individuals who are employed
26 by the State or any political subdivision thereof in teaching as
27 distinguished from administrative duties.
28 "Public official." Any elected or appointed official in the
29 Executive, Legislative or Judicial Branch of the State or any
30 political subdivision thereof, provided that it shall not
19890H0075B0211 - 8 -
1 include members of advisory boards that have no authority to
2 expend public funds other than reimbursement for personal
3 expense, or to otherwise exercise the power of the State or any
4 political subdivision thereof. ["Public official" shall not
5 include any appointed official who receives no compensation
6 other than reimbursement for actual expenses.]
7 "Represent." To act on behalf of any other person in any
8 activity which includes, but is not limited to, the following:
9 personal appearances, negotiations, lobbying and submitting bid
10 or contract proposals which are signed by or contain the name of
11 a former public official or public employee.
12 "State consultant." A person who, as an independent
13 contractor, performs professional, scientific, technical or
14 advisory service for a State agency, and who receives a fee,
15 honorarium or similar compensation for such services. A "State
16 consultant" is not an executive-level employee.
17 Section 3. Restricted activities.
18 (a) [No public official or public employee shall use his
19 public office or any confidential information received through
20 his holding public office to obtain financial gain other than
21 compensation provided by law for himself, a member of his
22 immediate family, or a business with which he is associated] No
23 public official or public employee shall engage in conduct that
24 constitutes a conflict of interest.
25 (b) No person shall offer or give to a public official, [or]
26 public employee or nominee or candidate for public office or a
27 member of his immediate family or a business with which he is
28 associated, and no public official, [or] public employee or
29 nominee or candidate for public office shall solicit or accept,
30 anything of monetary value, including a gift, loan, political
19890H0075B0211 - 9 -
1 contribution, reward, or promise of future employment based on
2 [any] his understanding that the vote, official action, or
3 judgment of the public official or public employee or nominee or
4 candidate for public office would be influenced thereby.
5 (c) (1) No public official or public employee shall accept
6 an honorarium.
7 (2) This subsection shall not be applied retroactively.
8 (d) (1) No person shall solicit or accept a severance
9 payment or anything of monetary value contingent upon the
10 assumption or acceptance of public office or employment.
11 (2) This subsection shall not prohibit:
12 (i) Payments received pursuant to an employment
13 agreement in existence prior to the time a person becomes
14 a candidate or is under consideration for public office
15 or makes application for public employment.
16 (ii) Receipt of a salary, fees, severance payment or
17 proceeds resulting from the sale of a person's interest
18 in a corporation, professional corporation, partnership
19 or other entity resulting from termination or withdrawal
20 therefrom upon the assumption or acceptance of public
21 office or employment.
22 (3) Payments made or received pursuant to paragraph
23 (2)(i) and (ii) shall not be based on the understanding,
24 written or otherwise, that the vote or official action of the
25 prospective public official or employee would be influenced
26 thereby.
27 (4) This subsection shall not be applied retroactively.
28 [(c)] (e) No public official or public employee or [a member
29 of his immediate family or any business in which the person or a
30 member of the person's immediate family is a director, officer,
19890H0075B0211 - 10 -
1 owner or holder of stock exceeding 5% of the equity at fair
2 market value of the business] his spouse or child or any
3 business in which the person or his spouse or child is
4 associated shall enter into any contract valued at $500 or more
5 [with a governmental body unless the contract has been awarded
6 through an open and public process, including prior public
7 notice and subsequent public disclosure of all proposals
8 considered and contracts awarded] with the governmental body
9 with which the public official or public employee is associated
10 or any subcontract valued at $500 or more with any person who
11 has been awarded a contract with the governmental body with
12 which the public official or public employee is associated,
13 unless the contract has been awarded through an open and public
14 process, including prior public notice and subsequent public
15 disclosure of all proposals considered and contracts awarded.
16 Any contract or subcontract made in violation of this subsection
17 shall be voidable by a court of competent jurisdiction if the
18 suit is commenced within 90 days of the making of the contract
19 or subcontract.
20 [(d) Other areas of possible conflict shall be addressed by
21 the commission pursuant to paragraph (9) of section 7.]
22 [(e)] (f) No former public official or public employee shall
23 represent a person, with or without compensation, on any matter
24 before the governmental body with which he has been associated
25 for one year after he leaves that body.
26 [(f)] (g) No person shall use for any commercial purpose
27 information copied from statements of financial interests
28 required by this act or from lists compiled from such
29 statements.
30 [(g)] (h) No former executive-level State employee may for a
19890H0075B0211 - 11 -
1 period of two years from the time that he terminates his State
2 employment be employed by, receive compensation from, assist or
3 act in a representative capacity for a business or corporation
4 that he actively participates in recruiting to the Commonwealth
5 of Pennsylvania or that he actively participated in inducing to
6 open a new plant, facility or branch in the Commonwealth or that
7 he actively participated in inducing to expand an existent plant
8 or facility within the Commonwealth, provided that the above
9 prohibition shall be invoked only when the recruitment or
10 inducement is accomplished by a grant or loan of money or a
11 promise of a grant or loan of money from the Commonwealth to the
12 business or corporation recruited or induced to expand.
13 [(h) (1) Any individual who holds an appointive office in
14 any political subdivision shall not have an interest in any
15 contract or construction in which that political subdivision
16 shall enter or have an interest.
17 (2) Any person violating the provisions of this
18 subsection shall be barred for a period of five years from
19 engaging in any business or contract with any political
20 subdivision or the Commonwealth or any of its agencies.
21 (3) For purposes of this subsection the term "interest"
22 shall not include the ownership of shares of stock in any
23 corporation in an amount of 5% or less of the total issue for
24 said corporation.]
25 (i) Where voting conflicts are not otherwise addressed by
26 law, rule, regulation, order or ordinance, the following
27 procedure shall be employed. Any public official or public
28 employee, who in the discharge of his official duties, would be
29 required to vote on a matter that would result in a conflict of
30 interest shall abstain from voting and, prior to the vote being
19890H0075B0211 - 12 -
1 taken, publicly announce and disclose the nature of his interest
2 as a public record in a written memorandum filed with the person
3 responsible for recording the minutes of the meeting at which
4 the vote is taken, provided that whenever a governing body would
5 be unable to take any action on a matter before it because a
6 majority of members of the body are required to abstain from
7 voting under the provisions of this subsection, then such
8 members shall be permitted to vote if disclosures are made as
9 otherwise provided herein.
10 Section 4. Statement of financial interests required to be
11 filed.
12 (a) Each public official of the Commonwealth shall file a
13 statement of financial interests for the preceding calendar year
14 with the commission no later than May 1 of each year that he
15 holds such a position and of the year after he leaves such a
16 position. Each public employee [employed by] and public official
17 of the Commonwealth shall file a statement of financial
18 interests for the preceding calendar year with the department,
19 agency, body or bureau in which he is employed or to which he is
20 appointed or elected no later than May 1 of each year that he
21 holds such a position and of the year after he leaves such a
22 position. Any other public employee or public official shall
23 file a statement of financial interests with the governing
24 authority of the political subdivision by which he is employed
25 or within which he is appointed or elected no later than May 1
26 of each year that he holds such a position and of the year after
27 he leaves such a position.
28 [(b) Each candidate for public office shall file a statement
29 of financial interests for the preceding calendar year with the
30 commission prior to filing a petition to appear on the ballot
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1 for election as a public official. A petition to appear on the
2 ballot shall not be accepted by an election official unless the
3 petition includes an affidavit that the candidate has filed the
4 required statement of financial interests with the commission.]
5 (b) (1) Any candidate for a State-level public office shall
6 file a statement of financial interests for the preceding
7 calendar year with the commission on or before the last day
8 for filing a petition to appear on the ballot for election. A
9 copy of the statement of financial interests shall also be
10 appended to such petition.
11 (2) Any candidate for county-level or local office shall
12 file a statement of financial interests for the preceding
13 calendar year with the governing authority of the political
14 subdivision in which he is a candidate on or before the last
15 day for filing a petition to appear on the ballot for
16 election. A copy of the statement of financial interests
17 shall also be appended to such petition.
18 (3) No petition to appear on the ballot for election
19 shall be accepted by the respective State or local election
20 officials unless the petition has appended thereto a
21 statement of financial interests as set forth in paragraphs
22 (1) and (2). Failure to file the statement in accordance with
23 the provisions of this act shall, in addition to any other
24 penalties provided, be a fatal defect to a petition to appear
25 on the ballot.
26 (c) Each [candidate] nominee for public office [nominated by
27 a public official or governmental body and subject to
28 confirmation by a public official or governmental body] shall
29 file a statement of financial interests for the preceding
30 calendar year with the commission and with the official or body
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1 that is vested with the power of confirmation at least ten days
2 before the official or body shall approve or reject the
3 nomination.
4 (d) No public official shall be allowed to take the oath of
5 office or enter or continue upon his duties, nor shall he
6 receive compensation from public funds, unless he has filed a
7 statement of financial interests [with the commission] as
8 required by this act.
9 (e) [(1) Any candidate for State or county-wide public
10 office shall file a statement of financial interests with the
11 commission pursuant to this act and shall file a copy of that
12 statement with the Board of Elections in the county in which
13 the candidate resides.
14 (2) Any candidate for local office shall file a
15 statement of financial interests with the commission pursuant
16 to this act and shall file a copy of that statement with the
17 governing authority of the political subdivision in which he
18 is a candidate.
19 (f)] All statements of financial interest filed pursuant to
20 the provisions of this act shall be made available for public
21 inspection and copying during regular office hours, and copying
22 facilities shall be made available at a charge not to exceed
23 actual cost.
24 Section 5. Statement of financial interests.
25 (a) The statement of financial interests filed pursuant to
26 this act shall be on a form prescribed by the commission. All
27 information requested on the statement shall be provided to the
28 best of the knowledge, information and belief of the person
29 required to file and shall be signed under [penalty of perjury
30 by the person required to file the statement] oath or equivalent
19890H0075B0211 - 15 -
1 affirmation.
2 (b) The statement shall include the following information
3 for the prior calendar year with regard to the person required
4 to file the statement [and the members of his immediate family].
5 (1) [The name] Name, address and public position [of the
6 person required to file the statement].
7 (2) [The occupations or professions of the person
8 required to file the statement and those of his immediate
9 family] Occupation or profession.
10 (3) Any direct or indirect interest in any real estate
11 which was sold or leased to the Commonwealth, any of its
12 agencies or political subdivisions; purchased or leased from
13 the Commonwealth, any of its agencies or political
14 subdivisions; or which was the subject of any condemnation
15 proceedings by the Commonwealth, any of its agencies or
16 political subdivisions.
17 (4) The name and address of each creditor to whom is
18 owed in excess of $5,000 and the interest rate thereon.
19 However, loans or credit extended between members of the
20 immediate family and mortgages securing real property which
21 is the principal residence of the person filing [or of his
22 spouse] shall not be included.
23 (5) The name and address of any [person who is the]
24 direct or indirect source of income totalling in the
25 aggregate [$500] $1,000 or more. However, this provision
26 shall not be construed to require the divulgence of
27 confidential information protected by statute or existing
28 professional codes of ethics or common law privileges.
29 [(6) The name and address of any person from whom a gift
30 or gifts valued in the aggregate at $200 or more were
19890H0075B0211 - 16 -
1 received, and the value and the circumstances of each gift.
2 However, this provision shall not be applicable to gifts
3 received from the individual's spouse, parents, parents by
4 marriage, siblings, children or grandchildren.
5 (7) The source of any honorarium received which is in
6 excess of $100.]
7 (6) (i) The name and address of the source and the <--
8 amount of any gift or gifts valued in the aggregate at
9 $200 or more and the circumstances of each gift. This <--
10 paragraph shall not apply to the payment for or
11 reimbursement of actual expenses for transportation and
12 lodging or hospitality received in connection with public
13 office or employment, unless such actual expenses for
14 transportation and lodging exceed $200 in the course of a
15 single occurrence or unless the value received for such
16 hospitality exceeds $50 in the course of a single
17 occurrence. This paragraph shall not apply to expenses
18 eligible for reimbursement by the governmental body with
19 which the public official or employee is associated; nor
20 shall this paragraph apply to a gift or gifts received
21 THIS PARAGRAPH SHALL NOT APPLY TO A GIFT OR GIFTS <--
22 RECEIVED from a spouse, parent, parent by marriage,
23 sibling, child, grandchild, other family member or friend
24 when the circumstances make it clear that the motivation
25 for the action was a personal or family relationship.
26 THIS PARAGRAPH SHALL NOT BE APPLIED RETROACTIVELY. <--
27 (ii) A person who is the source of any gift or gifts <--
28 required to be reported pursuant to this subsection
29 shall, quarterly, inform the recipient of the value and
30 aggregate value and circumstances of such gift or gifts.
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1 (7) (I) THE NAME AND ADDRESS OF THE SOURCE AND THE <--
2 AMOUNT OF ANY PAYMENT FOR OR REIMBURSEMENT OF ACTUAL
3 EXPENSES FOR TRANSPORTATION AND LODGING OR HOSPITALITY
4 RECEIVED IN CONNECTION WITH PUBLIC OFFICE OR EMPLOYMENT
5 WHERE SUCH ACTUAL EXPENSES FOR TRANSPORTATION AND LODGING
6 EXCEED $200 IN THE COURSE OF A SINGLE OCCURRENCE AND
7 WHERE THE VALUE RECEIVED FOR SUCH HOSPITALITY EXCEEDS $50
8 IN THE COURSE OF A SINGLE OCCURRENCE. THIS PARAGRAPH
9 SHALL NOT APPLY TO EXPENSES REIMBURSED BY THE
10 GOVERNMENTAL BODY WITH WHICH THE PUBLIC OFFICIAL OR
11 EMPLOYEE IS ASSOCIATED.
12 (II) A PERSON WHO PAYS FOR TRANSPORTATION, LODGING
13 OR HOSPITALITY REQUIRED TO BE REPORTED PURSUANT TO
14 SUBPARAGRAPH (I) SHALL, QUARTERLY, INFORM THE RECIPIENT
15 OF THE VALUE AND AGGREGATE VALUE AND CIRCUMSTANCES OF
16 SUCH PAYMENTS.
17 (III) THIS PARAGRAPH SHALL NOT BE APPLIED
18 RETROACTIVELY.
19 [(8)] (7) (8) Any office, directorship or employment of <--
20 any nature whatsoever in any business entity.
21 [(9)] (8) (9) Any financial interest in any legal entity <--
22 engaged in business for profit.
23 (9) (10) The identity of any financial interest in a <--
24 business with which the reporting person is or has been
25 associated in the preceding calendar year which has been
26 transferred to a member of the reporting person's immediate
27 family.
28 (c) [The] Except where an amount is required to be reported
29 pursuant to paragraphs (6) and (7), the statement of financial
30 [interest] interests need not include specific amounts for [any
19890H0075B0211 - 18 -
1 of] the items required to be listed.
2 Section 6. State Ethics Commission.
3 (a) There is established a State Ethics Commission composed
4 of seven members[,]. The President pro tempore of the Senate,
5 the Minority Leader of the Senate, the Speaker of the House, and
6 the Minority Leader of the House shall each appoint one member.
7 Three members shall be appointed by the Governor without
8 confirmation. No more than two of the members appointed by the
9 Governor shall be of the same political party. No appointee
10 shall have served as an officer in a political party for one
11 year prior to his appointment.
12 (b) Members of the commission shall serve for terms of five
13 years[, except that, of the members first appointed:
14 (1) the two members appointed by the President pro
15 tempore and Minority Leader of the Senate shall serve for
16 four years;
17 (2) the two members appointed by the Speaker and the
18 Minority Leader of the House shall serve for two years; and
19 (3) of the three members appointed by the Governor two
20 shall serve for three years, and one shall serve for five
21 years].
22 (c) No member shall be appointed to more than one full five-
23 year term on the commission.
24 (d) No individual, while a member or employee of the
25 commission, shall:
26 (1) hold or campaign for any other public office;
27 (2) hold office in any political party or political
28 committee;
29 (3) actively participate in or contribute to any
30 political campaign;
19890H0075B0211 - 19 -
1 (4) directly or indirectly attempt to influence any
2 decision by a governmental body, other than a court of law or
3 as a representative of the commission on a matter within the
4 jurisdiction of the commission; or
5 (5) be employed by the Commonwealth or a political
6 subdivision in any other capacity, whether or not for
7 compensation.
8 (e) A majority of the commission by resolution shall declare
9 vacant the position on the commission of any member who takes
10 part in activities prohibited by subsection (d). An individual
11 appointed to fill a vacancy occurring other than by the
12 expiration of a term of office shall be appointed for the
13 unexpired term of the member he succeeds, and is eligible for
14 appointment to one full five-year term thereafter. Any vacancy
15 occurring on the commission shall be filled within 30 days in
16 the manner in which that position was originally filled.
17 (f) The commission shall elect a chairman and a vice
18 chairman. The vice chairman shall act as chairman in the absence
19 of the chairman or in the event of a vacancy in that position.
20 (g) Four members of the commission shall constitute a quorum
21 and the votes of a majority of the members present is required
22 for any action or recommendation of the commission. The chairman
23 or any four members of the commission may call a meeting
24 provided that advance written notice is mailed to each member
25 and to any person who requests notice of such meetings.
26 (h) Members of the commission shall be compensated at a rate
27 of [$50] $75 per day and shall receive reimbursement for their
28 actual and necessary expenses while performing the business of
29 the commission.
30 (i) The commission shall employ an executive director, a
19890H0075B0211 - 20 -
1 [general] chief counsel, and such other staff as are necessary
2 to carry out its duties pursuant to this act. The executive
3 director shall be responsible for the administrative operations
4 of the commission and shall perform such other duties as may be
5 delegated or assigned to him by the commission, except that the
6 commission shall not delegate the making of regulations to the
7 executive director. The [general] chief counsel shall be the
8 chief legal officer of the commission. The commission may obtain
9 the services of experts and consultants as necessary to carry
10 out its duties pursuant to this act. The State Treasurer and the
11 Attorney General shall make available to the commission such
12 personnel, facilities, and other assistance as the commission
13 may request.
14 Section 7. [Duties] Powers and duties of the commission.
15 In addition to other powers and duties prescribed by law, the
16 commission shall:
17 (1) Prescribe and publish rules and regulations to carry
18 out the provisions of this act.
19 (2) Prescribe forms for statements and reports required
20 to be filed by this act and furnish such forms to persons
21 required to file such statements and reports.
22 (3) Prepare and publish guidelines setting forth
23 recommended uniform methods of accounting and reporting for
24 use by persons required to file statements and reports by
25 this act.
26 (4) Accept and file any information voluntarily supplied
27 that exceeds the requirements of this act.
28 (5) Inspect statements of financial interests which have
29 been filed in order to ascertain whether any reporting person
30 has failed to file such a statement or has filed a deficient
19890H0075B0211 - 21 -
1 statement. If, upon inspection, it is determined that a
2 reporting person has failed to file a statement of financial
3 interests or that any statement which has been filed fails to
4 conform with the requirements of section 5, then the
5 commission shall, in writing, notify the person. Such notice
6 shall state in detail the deficiency and the penalties for
7 failure to file or for filing a deficient statement of
8 financial interests.
9 [(5) Make] (6) Provide that statements and reports
10 filed with the commission be made available for public
11 inspection and copying during regular office hours and [make]
12 provide that copying facilities be made available at a charge
13 not to exceed actual cost and advise other State and local
14 agencies of the provisions of this paragraph.
15 [(6)] (7) Compile and maintain an index of all reports
16 and statements filed with the commission to facilitate public
17 access to such reports and statements and instruct other
18 State and local agencies which receive and file financial
19 interest statements in the maintenance of systems which
20 facilitate public access to such statements.
21 [(7)] (8) Prepare and publish annual summaries of
22 statements and reports filed with the commission.
23 [(8)] (9) Preserve statements and reports filed with the
24 commission for a period of five years from date of receipt
25 and advise other State and local agencies which receive and
26 store financial interests statements to preserve such
27 statements for a period of five years from date of receipt.
28 [(9) (i)] (10) Issue to any person, upon such person's
29 request, an opinion with respect to such person's duties
30 under this act. The commission shall, within 14 days, either
19890H0075B0211 - 22 -
1 issue the opinion or advise the person who made the request
2 whether an opinion will be issued. No person who acts in good
3 faith on an opinion issued to him by the commission shall be
4 subject to criminal or civil penalties for so acting,
5 provided that the material facts are as stated in the opinion
6 request. The commission's opinions shall be public records
7 and may from time to time be published.
8 [(ii)] (11) Provide written advice to any person or
9 the appointing authority or employer of said official, upon
10 their request with respect to such person's duties under this
11 act. Such advice shall be provided within 21 working days of
12 the request, provided that the time may be extended for good
13 cause. It shall be a complete defense in any enforcement
14 proceeding initiated by the commission, and evidence of good
15 faith conduct in any other civil or criminal proceeding, if
16 the requester, at least 21 working days prior to the alleged
17 violation, requested written advice from the commission in
18 good faith, disclosed truthfully all the material facts and
19 committed the acts complained of either in reliance on the
20 advice or because of the failure of the commission to provide
21 advice within 21 days of the request [of] or such later
22 extended time.
23 [(iii)] (12) Initiate an inquiry, pursuant to
24 section 8(a), where [an opinion] a complaint has not been
25 [requested] filed but where there [is a reasonable belief]
26 may be reason to believe that a conflict [may exist] exists.
27 [Such inquiry shall be conducted in privacy with full respect
28 to the confidentiality of all the parties involved in the
29 alleged conflict. If the commission finds that there is a
30 conflict, the information shall be provided for criminal
19890H0075B0211 - 23 -
1 proceedings unless the alleged offender removes himself from
2 the conflict with receiving financial gain.
3 (iv) Issue advisory opinions to any present or
4 former State employee who contemplates terminating his
5 State employment and/or becoming employed by, contracting
6 with, assisting or acting in a representative capacity
7 for a business or corporation, upon such employee's
8 request. That opinion shall state whether, upon the facts
9 presented, such employment, contract, assistance or
10 representation would be in violation of section 3(g). If
11 the advisory opinion states that such employment,
12 contract, assistance or representation would not be in
13 violation of the provisions of section 3(g), the person
14 who requested the opinion may not be prosecuted or
15 penalized, either criminally or civilly, under the
16 provisions of this act provided that the actions under
17 question bear a substantial similarity to the facts
18 presented to the commission.]
19 (13) Issue findings reports and orders relating to
20 investigations initiated pursuant to section 8, which set
21 forth the alleged violation, findings of fact and conclusions
22 of law. An order may include recommendations to law
23 enforcement officials. Any order resulting from a finding
24 that a public official or public employee has obtained a
25 financial gain in violation of this act may require the
26 restitution plus interest of that gain to the appropriate
27 governmental body. The commission or the Office of Attorney
28 General shall have standing to apply to the Commonwealth
29 Court to seek enforcement of an order requiring such
30 restitution. This restitution requirement shall be in
19890H0075B0211 - 24 -
1 addition to any other penalties provided for in this act.
2 [(10)] (14) Hold hearings, take testimony, issue
3 subpoenas and compel the attendance of witnesses.
4 [(11)] (15) Make recommendations to law enforcement
5 officials either for criminal prosecution or dismissal of
6 charges arising out of violations of this act.
7 [(12)] (16) Prepare and publish special reports,
8 educational materials, and technical studies to further the
9 purposes of this act.
10 [(13)] (17) Prepare and publish, prior to June 1 of each
11 year, an annual report summarizing the activities of the
12 commission.
13 (18) Transmit, free of charge, copies of each order,
14 advice and opinion which has become a matter of public record
15 to the appointing authorities specified in section 6(a).
16 Section 8. Investigations by the commission.
17 (a) Upon a complaint signed under penalty of perjury by any
18 person or upon its own motion, the commission [shall
19 investigate], through its executive director, shall conduct a
20 preliminary inquiry into any alleged violation of this act. [All
21 commission proceedings and records relating to an investigation
22 shall be confidential until a final determination is made by the
23 commission. The executive director shall notify any person under
24 investigation by the commission of the investigation and of the
25 nature of the alleged violation within five days of the
26 commencement of the investigation. Within 15 days of the filing
27 of a sworn complaint by a person alleging a violation, and every
28 30 days thereafter until the matter is terminated, the executive
29 director shall notify the complainant of the action taken to
30 date by the commission together with the reasons for such action
19890H0075B0211 - 25 -
1 or nonaction.] The commission shall keep information, records
2 and proceedings relating to a preliminary inquiry confidential.
3 The commission shall, however, have the authority to refer the
4 case to law enforcement officials during a preliminary inquiry
5 or anytime thereafter without providing notice to the subject of
6 the inquiry. The commission shall complete its preliminary
7 inquiry within 60 days of its initiation.
8 (b) If a preliminary [investigation] inquiry fails to
9 [indicate probable cause for belief] establish reason to believe
10 that this act has been violated, the commission shall terminate
11 the [investigation] inquiry and so notify the complainant and
12 the person who had been [under investigation.] the subject of
13 the inquiry. If the commission determines that a complaint is
14 frivolous, it shall so state.
15 (c) If a preliminary inquiry establishes reason to believe
16 that this act has been violated, the commission may, through its
17 executive director, initiate an investigation to determine if
18 there has been a violation. The commission shall keep
19 information, records and proceedings relating to an
20 investigation confidential until a final determination is made,
21 except as otherwise provided in subsection (f). No investigation
22 may be commenced until the person who is the subject of the
23 investigation has been notified and provided a general statement
24 of the alleged violation or violations of the act and other
25 applicable statutes with respect to such investigation. Service
26 of notice is complete upon mailing which shall be by certified
27 or registered mail. The commission shall notify the complainant
28 within 72 hours of the commencement of an investigation and,
29 thereafter, the commission shall advise the complainant and the
30 person who is the subject of the investigation of the status of
19890H0075B0211 - 26 -
1 the investigation at least every 90 days until the investigation
2 is terminated. The commission shall, within 180 days of the
3 initiation of an investigation, either terminate the
4 investigation pursuant to subsection (d) or issue a findings
5 report pursuant to subsection (e). Upon a showing by the
6 executive director of the need for extension of this period, the
7 commission may extend an investigation for up to two 90-day
8 periods, provided that each 90-day extension shall be approved
9 by a majority vote of members present. In no event shall a
10 findings report be issued later than 360 days after initiation
11 of an investigation.
12 (d) If an investigation conducted under this act indicates
13 that no violation has been committed, the commission shall
14 immediately terminate the investigation and send written notice
15 of such determination to the complainant and the person who was
16 the subject of the investigation.
17 (e) The commission, upon the completion of an investigation,
18 shall issue a findings report to the subject of the
19 investigation setting forth the pertinent findings of fact. The
20 subject shall have the right to respond to said findings and to
21 request an evidentiary hearing on said matter. Any response to
22 the findings report must either admit or deny by corresponding
23 number and letter the pertinent facts set forth. The subject of
24 the investigation shall have access to any evidence intended to
25 be used by the commission at the hearing. Matters not
26 specifically denied in the response shall be deemed admitted.
27 The response must be filed within 30 days of the issuance of the
28 findings report unless the time period is extended by the
29 commission for good cause shown. Hearings conducted upon request
30 shall be instituted within 45 days after the filing of the
19890H0075B0211 - 27 -
1 response.
2 (f) Within 30 days of the receipt by the commission of the
3 hearing record, or if no hearing is to be held, within 30 days
4 of the receipt by the commission of the response to the findings
5 report, the commission shall issue an order which shall be
6 final. Upon receipt of a final order, the subject shall have the
7 right to file a petition for reconsideration in accordance with
8 the regulations of the commission.
9 (g) Hearings conducted pursuant to this section shall be
10 closed to the public unless the subject requests an open
11 hearing. Any person who appears before the commission shall have
12 all of the due process rights, privileges and responsibilities
13 of a party or witness appearing before an administrative agency
14 of this Commonwealth. All witnesses summoned for such hearings
15 shall receive reimbursement for reasonable expenses in
16 accordance with 42 Pa.C.S. § 5903 (relating to compensation and
17 expenses of witnesses). At the conclusion of a hearing
18 concerning an alleged violation and in a timely manner, the
19 commission shall deliberate on the evidence and determine, by
20 majority vote of the members present, whether there has been a
21 violation of this act. The determination of the commission, in
22 the form of a final order and findings of fact, shall be a
23 matter of public record.
24 (h) Orders which become final in accordance with the
25 provisions of this section shall be available as public
26 documents, but the files and records of the commission relating
27 to the case shall remain confidential.
28 (i) No action may be taken by the commission on a complaint
29 filed against a public official or public employee unless the
30 alleged offense was committed during the period of time within
19890H0075B0211 - 28 -
1 which the official or employee was in public office, was a
2 nominee or candidate for public office, or was employed as a
3 public employee, or within five years thereafter.
4 (j) Any person aggrieved by an opinion or order which
5 becomes final in accordance with the provisions of this act who
6 has direct interest in such opinion or order shall have the
7 right to appeal therefrom in accordance with law and general
8 rules.
9 (k) No public official or public employee shall discharge
10 any official or employee or change his official rank, grade or
11 compensation, or deny him a promotion, or threaten to do so, for
12 filing a complaint with or providing information to the
13 commission or testifying in any commission proceeding.
14 Section 9. Penalties.
15 (a) Any person who violates the provisions of section 3(a)
16 [and (b)] , (b) and (c) is guilty of a felony and shall be fined
17 not more than $10,000 or imprisoned for not more than five
18 years, or be both fined and imprisoned.
19 (b) Any person who violates the provisions of section [3(c)]
20 3(d) through [(h) or] (i), section 4 or section 5(a) is guilty
21 of a misdemeanor and shall be fined not more than $1,000 or
22 imprisoned for not more than one year, or be both fined and
23 imprisoned.
24 (c) Any person who obtains financial gain from violating any
25 provision of this act, in addition to any other penalty provided
26 by law, shall pay [into the State Treasury] a sum of money equal
27 to three times the amount of the financial gain resulting from
28 such violation into the State Treasury or the treasury of the
29 political subdivision. Treble damages shall not be assessed
30 against a person who acted in good faith reliance on the advice
19890H0075B0211 - 29 -
1 of legal counsel.
2 (d) The penalties prescribed in this act do not limit the
3 power of either House of the Legislature to discipline its own
4 members or impeach a public official, and do not limit the power
5 of agencies or commissions to discipline officials or employees.
6 (e) Any person who violates the confidentiality of a
7 commission proceeding pursuant to section 8, is guilty of a
8 misdemeanor and shall be fined not more than $1,000 or
9 imprisoned for not more than one year, or be both fined and
10 imprisoned. Any person who engages in retaliatory activity
11 proscribed by section 8(k) is guilty of a misdemeanor and, in
12 addition to any other penalty provided by law, shall be fined
13 not more than $1,000 or imprisoned for not more than one year,
14 or be both fined and imprisoned. Any person who willfully
15 affirms or swears falsely in regard to any material matter
16 before a commission proceeding pursuant to section 8 is guilty
17 of a felony and shall be fined not more than $5,000 or
18 imprisoned for not more than five years, or be both fined and
19 imprisoned.
20 (f) In addition to any other civil remedy or criminal
21 penalty provided for in this act, the commission may, after
22 notice has been served in accordance with paragraph (5) of
23 section 7 and upon a majority vote of its members, levy a civil
24 penalty upon any person subject to this act who fails to file a
25 statement of financial interests in a timely manner or who files
26 a deficient statement of financial interests, at a rate of not
27 more than $25 for each day such statement remains delinquent or
28 deficient. The maximum penalty payable under this paragraph is
29 $250.
30 (G) A PUBLIC OFFICIAL OF A POLITICAL SUBDIVISION WHO ACTS IN <--
19890H0075B0211 - 30 -
1 GOOD FAITH RELIANCE UPON THE ADVICE OF THE SOLICITOR OF THE
2 POLITICAL SUBDIVISION SHALL NOT BE SUBJECT TO THE PENALTIES
3 PROVIDED FOR IN THIS SECTION.
4 Section 10. [Court employees.] Constables.
5 Nothing in this act, or in any other law or court rule shall
6 be construed to prohibit any constable [or any employee of a
7 court of common pleas, the Municipal Court of Philadelphia, the
8 Traffic Court of Philadelphia, or any employee of a district
9 justice] from also being an officer of a political body or
10 political party as such terms are defined in the act of June 3,
11 1937 (P.L.1333, No.320), known as the "Pennsylvania Election
12 Code," and the same may hold the office of a county, State or
13 national committee of any political party, and may run for and
14 hold any elective office, and may participate in any election
15 day activities.
16 Section 2. The act is amended by adding a section to read:
17 Section 10.1. Wrongful use of act.
18 (a) A person who signs a complaint alleging a violation of
19 this act against another is subject to liability for wrongful
20 use of this act if:
21 (1) he acted in a grossly negligent manner or without
22 probable cause and primarily for a purpose other than that of
23 reporting a violation of this act;
24 (2) he publicly disclosed or caused to be disclosed that
25 a complaint against a person had been filed with the
26 commission; and
27 (3) the complaint was frivolous as defined by this act
28 or there was a lack of probable cause for belief that this
29 act had been violated by the person.
30 (b) A person who signs a complaint alleging a violation of
19890H0075B0211 - 31 -
1 this act has probable cause for doing so if he reasonably
2 believes in the existence of the facts upon which the claim is
3 based and either:
4 (1) reasonably believes that under those facts the
5 complaint may be valid under this act; or
6 (2) believes to this effect in reliance upon the advice
7 of counsel, sought in good faith and given after full
8 disclosure of all relevant facts within his knowledge and
9 information.
10 (c) When the commission determines that a complainant has
11 violated the provisions set forth in section 10.1(a) the
12 commission upon receiving a written request from the subject of
13 the complaint shall provide the name and address of the
14 complainant to said subject.
15 (d) When the essential elements of an action brought
16 pursuant to this section have been established, the plaintiff is
17 entitled to recover for the following:
18 (1) The harm to his reputation by a defamatory matter
19 alleged as the basis of the proceeding.
20 (2) The expenses, including any reasonable attorney
21 fees, that he has reasonably incurred in proceedings before
22 the commission.
23 (3) Any specific pecuniary loss that has resulted from
24 the proceedings.
25 (4) Any emotional distress that has been caused by the
26 proceedings.
27 (5) Any punitive damages according to law in appropriate
28 cases.
29 Section 3. Section 11 of the act is reenacted and amended to
30 read:
19890H0075B0211 - 32 -
1 Section 11. Supplemental provisions.
2 Any governmental body may adopt requirements to supplement
3 this act, provided that no such [requirement] requirements shall
4 in any way be less restrictive than the act.
5 Section 4. Sections 12 and 13 of the act are reenacted to
6 read:
7 Section 12. Conflict of law.
8 If the provisions of this act conflict with any other
9 statute, ordinance, regulation or rule, the provisions of this
10 act shall control.
11 Section 13. Severability.
12 If any provision of this act, or the application thereof to
13 any person or circumstance, is held invalid, the validity of the
14 remainder of this act and the application of such provisions to
15 other persons and circumstances shall not be affected thereby.
16 Section 5. Section 14 of the act, amended February 26, 1979
17 (P.L.1, No.1), is reenacted to read:
18 Section 14. Effective date.
19 This act shall take effect January 1, 1979 except that
20 subsections (b) and (e) of section 4 shall take effect August 1,
21 1979 and subsections (a) and (d) of section 4 shall take effect
22 January 1, 1980: Provided, however, That the Ethics Commission
23 shall have the power and duty to require the filing of the
24 financial disclosure statements of candidates for elective
25 office between August 1, 1979 and January 1, 1980 at least 60
26 days prior to such election, or in the case of a special
27 election at least 15 days prior to such election.
28 Section 6. Persons who are members of the State Ethics
29 Commission on the effective date of this act shall serve until
30 their current terms have expired and shall be subject to the
19890H0075B0211 - 33 -
1 additional restrictions of section 6(d)(3) and (5) of the act of
2 October 4, 1978 (P.L.883, No.170), referred to as the Public
3 Official and Employee Ethics Law, unless a current commissioner
4 was employed by a political subdivision on or before the
5 effective date of this amendatory act, in which case the
6 restriction set forth in section 6(d)(5) shall not apply.
7 Section 7. All rules and regulations promulgated by the
8 State Ethics Commission shall remain in full force and effect
9 until amended or rescinded by the commission, provided that the
10 commission shall immediately initiate action to rescind or amend
11 any rule or regulation that is in conflict with the provisions
12 of this amendatory act or to promulgate additional regulations
13 which may be required to implement the provisions of this
14 amendatory act.
15 Section 8. This act, with respect to the State Ethics
16 Commission, constitutes the legislation required to reestablish
17 an agency pursuant to the act of December 22, 1981 (P.L.508,
18 No.142), known as the Sunset Act. The State Ethics Commission
19 shall continue, together with its statutory functions and
20 duties, until December 31, 1994, when it shall terminate and go
21 out of existence unless reestablished or continued by the
22 General Assembly for an additional ten years. Evaluation,
23 review, termination, reestablishment and continuation of the
24 agency beyond December 31, 1994, and every tenth year
25 thereafter, shall be conducted pursuant to the Sunset Act.
26 Section 9. This amendatory act shall not apply to violations
27 committed prior to the effective date of this act, and causes of
28 action initiated for such violations shall be governed by the
29 prior law, which is continued in effect for that purpose as if
30 this act were not in force. For the purposes of this section, a
19890H0075B0211 - 34 -
1 violation was committed prior to the effective date of this act
2 if any elements of the violation occurred prior thereto.
3 Section 10. The sum of $30,000 is hereby appropriated to the
4 State Ethics Commission for the indexing of all opinions, orders
5 or advice of the commission, and for the maintenance of this
6 index.
7 Section 11. This act shall take effect immediately.
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