The School Ethics Act: Advisory Opinions & DecisionsPRESENTED TO THE MONTGOMERY TOWNSHIP BOARD OF EDUCATIONJANUARY 13, 2015

STEPHEN R. FOGARTY, ESQ.FOGARTY & HARA, ESQS.21-00 ROUTE 208 SOUTH, FAIR LAWN, NEW JERSEY 07410PHONE: 201-791-3340 | FAX: 201-791-3432E-MAIL: SFOGARTY@FOGARTYANDHARA.COM

THE SCHOOL ETHICS ACTN.J.S.A. 18A:12-21 ET SEQ.

Legislative Findings:

It is essential that the conduct of members of local boards of education and local school administrators hold the respect and confidence of the people.

These board members and administrators must avoid conduct which is in violation of their public trust or which creates a justifiable impression among the public that such trust is being violated.

Important Definitions: • A board member, an officer or employee

of the New Jersey School Boards Association (other than clerical, secretarial or maintenance staff) or an administrator.

School Officials

• Ownership or control of more than 10% of the profits, assets or stock of a business, but does not include the control of assets in a labor union.

Interest

• Any corporation, partnership, firm, enterprise, franchise, association, trust, sole proprietorship, union, political organization, or other legal entity but shall not include a local school district or any other public entity.

Business

Important Definitions: • Spouse, partner in a domestic union

or dependent child of a school official residing in the same household.

Member of Immediate

Family

• Spouse, natural or adopted child, parent or sibling of a school official.Relative

• Holds a position that authorizes to serve as administrator, principal or SBA; or

• Holds a position where responsible for making recommendations regarding hiring or purchasing, or

• Holds position requiring supervisor certificate and responsible for making recommendations regarding hiring or purchasing.

Administrator

Prohibited Acts:

Inconsistent Interests:No member of any board of education shall be interested directly or indirectly in any contract with or claim against the board, nor, in the case of local and regional school districts, shall he [or she] hold office as mayor or as a member of the governing body of a municipality. N.J.S.A. 18A:12-2

Prohibited Acts (cont.):

(A)

• No school official or member of his immediate family shall have an interest in a business organization or engage in any business, transaction, or professional activity, which is in substantial conflict with the proper discharge of his duties in the public interest.

(B)•No school official shall use or attempt to use his official position to secure unwarranted privileges, advantages or employment for himself, members of his immediate family or others.

Prohibited Acts (cont.):

(C-1)

• No school official shall act in his official capacity in any matter where he, a member of his immediate family, or a business organization in which he has an interest, has a direct or indirect financial involvement that might reasonably be expected to impair his objectivity or independence of judgment.

(D)•No school official shall undertake any employment or service, whether compensated or not, which might reasonably be expected to prejudice his independence of judgment in the exercise of his official duties.

(C-2)•No school official shall act in his official capacity in any matter where he or a member of his immediate family has a personal involvement that is or creates some benefit to the school official or member of his immediate family.

Prohibited Acts (cont.):

(E-1)

• No school official, or member of his immediate family, or business organization in which he has an interest, shall solicit or accept any gift, favor, loan, political contribution, service, promise of future employment, or other thing of value based upon an understanding that the gift, favor, loan, contribution, service, promise or other thing of value was given or offered for the purpose of influencing him, directly or indirectly, in the discharge of his official duties.

(E-2)

• This provision shall not apply to the solicitation or acceptance of contributions to the campaign of an announced candidate for elective public office, if the school official has no knowledge or reason to believe that the campaign contribution, if accepted, was given with the intent to influence the school official in the discharge of his official duties.

Prohibited Acts (cont.):

(F)

• No school official shall use, or be allowed to use, his public office or employment, or any information, not generally available to the members of the public, which he receives or acquires in the course of and by reason of his office or employment, for the purpose of securing financial gain for himself, any member of his immediate family, or any business organization with which he is associated.

(G)

• No school official or business organization in which he has an interest shall represent any person or party other than the school board or school district in connection with any cause, proceeding, application or other matter pending before the school district in which he serves or in any proceeding involving the school district in which he serves or, for officers or employees of the New Jersey School Boards Association, any school district. This provision shall not be deemed to prohibit representation within the context of official labor union or similar representational responsibilities.

Prohibited Acts (cont.):

No school official shall be deemed in

conflict if, by reason of his

participation in any matter required to be voted upon, no

material or monetary gain

accrues to him to any greater extent than any gain could

reasonably be expected to accrue

to any other member of that

group.

No elected member shall be prohibited

from making an inquiry for

information on behalf of a

constituent, if no fee, reward or other

thing of value is promised to, given to, or accepted by the member or a member of his

immediate family, whether directly or indirectly, in return

therefor.

Nothing shall prohibit any

school official, or members of his

immediate family, from representing himself, or

themselves, in negotiations or

proceedings concerning his, or

their, own interests.

Code of Ethics for School Board Members:

(a) I will uphold and enforce all laws, rules and regulations of the State Board of Education, and court orders pertaining to schools. Desired changes shall be brought about only through legal and ethical procedures.

(b) I will make decisions in terms of the educational welfare of children and will seek to develop and maintain public schools that meet the individual needs of all children regardless of their ability, race, creed, sex, or social standing.

(c) I will confine my board action to policy making, planning, and appraisal, and I will help to frame policies and plans only after the board has consulted those who will be affected by them.

Code of Ethics for School Board Members (cont.):

(d) I will carry out my responsibility, not to administer the schools, but, together with my fellow board members, to see that they are well run.

(e) I will recognize that authority rests with the board of education and will make no personal promises nor take any private action that may compromise the board.

(f) I will refuse to surrender my independent judgment to special interest or partisan political groups or to use the schools for personal gain or for the gain of friends.

Code of Ethics for School Board Members (cont.):(g) I will hold confidential all matters pertaining to

the schools which, if disclosed, would needlessly injure individuals or the schools. In all other matters, I will provide accurate information and, in concert with my fellow board members, interpret to the staff the aspirations of the community for its school.(h) I will vote to appoint the best qualified personnel available after consideration of the recommendation of the chief administrative officer.

(i) I will support and protect school personnel in proper performance of their duties.

(j) I will refer all complaints to the chief administrative officer and will act on the complaints at public meetings only after failure of an administrative solution.

Financial and Personal/Relative disclosure ( N.J.S.A. 18A:12-26)

(a) Each school official shall annually file a financial disclosure statement with the School Ethics Commission, which shall specify, the name and address of each source and the school official’s position: (1) Source of income, earned or unearned, exceeding $2,000 received

by the school official or a member of his immediate family during the preceding year.

Individual client fees, customer receipts or commissions on transactions received through a business organization need not be separately reported as sources of income.

If public traded security or interest derived from a financial institution is the source of income, the security or interest derived from a financial institution need not be reported unless the school official or member of his immediate family has an interest in the business organization or financial institution.

(2) Each source of fees and honorariums having an aggregate amount exceeding $250 from any single source for personal appearances, speeches or writings received by the school official or a member of his immediate family during the preceding calendar year.

Financial and Personal/Relative disclosure ( N.J.S.A. 18A:12-26)

(cont.) (3) Each source of gifts, reimbursements or prepaid expenses having an aggregate value exceeding $250 from any single source, excluding relatives received by the school official or a member of his immediate family during the preceding calendar year; and

(4) The name and address of all business organizations in which the school official or a member of his immediate family had an interest during the preceding calendar year.

(b) The commission shall prescribe a financial disclosure statement form for filing purposes. Financial disclosure statements shall be filed on or before April 30th each year.

(c) All financial disclosure statements filed shall be public records.

Alleged Violations of the Act:

The School Ethics Commission

Established by the School Ethics Act, consisting of nine (9) members, not more than five (5) of whom shall be from the same political party: two (2) shall be board members, two (2) shall be school administrators and

five (5) shall be persons who are not school officials. All members are appointed by the Governor.

SEC Jurisdiction:

• Any person, including a member of the SEC, may file a complaint alleging a violation of the provisions of the School Ethics Act or the Code of Ethics for School Board Members by submitting it, under oath, on a form prescribed by the commission, to the SEC.

Ethics Complaints

•A school official may request and obtain from the SEC an advisory opinion as to whether any proposed activity or conduct would, in its opinion, constitute a violation of the provisions of the Act.

Advisory Opinions

•The Commission shall not process any complaint, issue a final ruling or issue any advisory opinion on a matter actually pending in any court of law or administrative agency of this State.

Pending Matters

NEPOTISM POLICYN.J.A.C. 6A:23A-6.2

Policy Requirements:

As a condition of receiving State aid, a school district must implement a nepotism policy that includes certain definitions and provisions …

Required Definitions:• The individual’s spouse, civil union partner,

domestic partner, or the parent, child, sibling, aunt, uncle, niece, nephew, grandparent, grandchild, son-in-law, daughter-in-law, stepparent, stepchild, stepbrother, stepsister, half-brother or half-sister of the individual or the individual’s spouse, civil union partner or domestic partner, whether the relative is related to the individual or the individual’s spouse, civil union partner or domestic partner by blood, marriage or adoption.

Relative

•The person’s spouse, partner in a civil union, or dependent child, residing in the same household.

Immediate Family Member

Required Provisions:

#1: A provision prohibiting any relative of a school board member or chief administrator (“CSA”) from being employed in an office or position in that district.

With certain exceptions…

Exceptions:

A person employed by the district on the effective date of the policy or the date a relative becomes a school board member or chief school administrator shall not be prohibited from continuing to be employed or be promoted in the district.

Required Provisions (cont.):

#2: A provision prohibiting the CSA from recommending to the board any relative of a board member or CSA, unless the person is subject to the above exception.

Required Provisions (cont.):#3: A provision prohibiting a district administrator from exercising direct or indirect authority, supervision or control over a relative of the administrator.

Where it is not feasible to eliminate such a direct or indirect supervisory relationship, appropriate screens and/or alternative supervision and reporting mechanisms must be put in place.

Required Provisions (cont.):#4: A provision prohibiting a district administrator or board member who has a relative who is a member of the bargaining unit from discussing or voting on the proposed collective bargaining agreement with that unit or from participating in any way in negotiations, including, but not limited to, being a member of the negotiating team.

Nor should that district administrator be present with the board in closed session when negotiations strategies are being discussed; provided, however, that the administrator may serve as a technical resource to the negotiating team and may provide technical information necessary to the collective bargaining process when no one else in the district can provide such information.

Required Provisions (cont.):#5: A provision prohibiting a district administrator or board member who has an immediate family member who is a member of the same statewide union in another district from participating in any way in negotiations, including, but not limited to, being a member of the negotiating team or being present with the school board in closed sessions when negotiation strategies are being discussed, prior to the school board attaining a tentative memorandum of agreement with the bargaining unit that includes a salary guide and total compensation package.

However…

Required Provisions (cont.):Once the tentative memorandum of agreement is established, a district administrator with an immediate family member who is a member of the same statewide union in another district may fully participate in the process, absent other conflicts.

Notwithstanding the above, a district administrator who has an immediate family member who is a member of the same statewide union in another district may serve as a technical resource to the negotiating team and may provide technical information necessary to the collective bargaining process when no one else in the district can provide such information.

Optional Provisions:

*A school district or county vocational school district may exclude per diem substitutes and student employees from its board nepotism policy.

*Montogmery’s Board of Education Nepotism Policy does provide for this exception. Board By-Law No. 0142.1

ETHICS DECISIONS AND ADVISORY OPINIONS ISSUED BY THE SEC

Advisory Opinions:

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Recent Ethics Decisions: Appellate Division

Recent Ethics Decisions: Appellate Division

On appeal, the Appellate Division concluded that the Commissioner’s decision lacked sufficient clarity, failed to provide the level of guidance that is necessary as to who can issue a RICE notice, and did not fully address other aspects of the board member’s conduct that were alleged to constituted ethical violations. Persi v. Woska, 2013 WL 6480255 (App. Div. Dec. 11, 2013).

On remand, the Commissioner of Education clarified that “a single board member is without authority to direct issuance of a RICE notice to the chief school administrator of a district. Rather, that authority lies with the president of the district board of education or a majority of the full membership of a district board of education.” Persi v. Woska, Comm’r, No. 260-14A (June 17, 2014).

The matter was remanded back to the SEC.

SEC Decision on Remand

On remand, the Commission indicated that the Commissioner of Education’s decision fully supports and substantiates the position that a Board Member alone lacks the authority to issue a Rice notice and, therefore, its prior ruling on this issue remains undisturbed.

The Commission further concluded that the Board member violated N.J.S.A. 18A:12-24.1(e), “Private Action,” through his discussions with the three members elect resulting in him becoming the new Board President and leading to the termination of the superintendent.

QUESTIONS ?