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NYS Ethics Commission Advisory Opinion 03-4

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NYS Ethics Commission Advisory Opinion 03-4 Advisory Opinion No. Whether the “former agency” of [a senior official at] a State agency 03-4: includes its parent agency or other affiliated agencies for purposes of applying the post-employment restrictions of Public Officers Law §73(8)(a)(i). INTRODUCTION The following advisory opinion is issued in response to a request submitted by the former [senior official] of the Long Island Railroad (“LIRR”), who asks how the restrictions of the Public Officers Law would affect his ability to work for a private entity after his retirement. To answer this question, the Commission must decide whether the two-year bar of the Public Officers Law §73(8)(a)(i) would preclude his appearing, practicing or rendering services for compensation before the LIRR only, or whether it should extend to its parent agency, the Metropolitan Transportation Authority (“MTA”) or the MTA’s other affiliated agencies. Pursuant to its authority under Executive Law §94(15), the New York State Ethics Commission (“Commission”) concludes that [the requesting individual’s] former agency for purposes of the two-year bar includes the LIRR and the MTA, but does not extend to the MTA’s affiliated agencies and subsidiaries. BACKGROUND The question of which agency or agencies are [the requesting individual’s] “former agency” is not a simple one because of the LIRR’s relationship with its parent agency, the MTA, and the LIRR’s collaboration with other MTA affiliated agencies on various issues and projects. 1 On [date], [the requesting individual] retired from the LIRR having held the title of [a senior official] for three years; prior to that he was [a senior official in another job title]. As [a senior official], he was responsible for all managerial aspects of the company, including the operation of 770 trains per day. There is no question that the LIRR is his former agency for the purposes of the Public Officers Law. Due to pension considerations, [the requesting individual] was placed on the payroll of the MTA during his tenure at the LIRR. While his job responsibilities related primarily to the LIRR, he had responsibilities to the MTA in two areas: (1) he was [ ] of the All-Agency Deferred Compensation (401K and 457) Plan, and (2) he was [ ]for the Excess Liability Fund (an all- agency excess liability fund). As [a senior official] of the LIRR, [the requesting individual] oversaw major capital programs that involved working with affiliated agencies. For example, he was involved in the planning and construction of the East Side Access project, which will connect LIRR trains to Metro-North Commuter Railroad’s (“Metro-North”) base at Grand Central Station. He also participated in the planning of the renovation of the Atlantic Terminal, a project shared with the New York City Transit Authority (“TA”). This project involved joint funding and project management coordination between the LIRR and the TA for its design and construction. The LIRR also shares capital programs with other affiliated agencies, such as the purchase of ticket vending machines with Metro-North. In addition, last year, the Chairman of the MTA announced a restructuring plan that would merge various affiliated agencies into five distinct companies under the MTA in an effort to cut costs and streamline operations. Part of the plan, which requires legislative approval, calls for the LIRR and Metro-North to become one entity, known as the MTA Railroad. [The requesting individual] has accepted a position as [a senior official] for [ ], a private company which provides construction, maintenance and material solutions for the rail and rail- transit industries. [The private company] has two main business units:[ ]. [The private company] offers its products to private industries, public transit authorities, and railroads of all sizes. As [a senior official], [the requesting individual] will be responsible for all budgeting, treasury, and financial operations at [the private company] and its subsidiaries. He will also oversee information systems and internal auditing, and will be reporting to the [a senior official] and Chief Operating Officer. [The private company] conducts considerable business with the TA. Its subsidiary, [ ], has been involved since [date] with the [ ] Project which will centralize dispatch and train control functions for the TA. Given [the requesting individual’s] responsibilities to the MTA and the LIRR’s involvement with the MTA’s affiliates and subsidiaries, the issue before the Commission is whether, in addition to the LIRR, the MTA or its affiliates and subsidiaries are [the requesting individual’s] former agencies for application of the two-year bar. APPLICABLE STATUTES The statutory language setting forth the two-year bar is found in Public Officers Law §73(8)(a)(i), which states: No person who has served as a state officer or employee shall within a period of two years after the termination of such service or employment appear or practice before such state agency or receive compensation for any services rendered by such former officer or employee on behalf of any person, firm, corporation, or association in relation to any case, proceeding or application or other matter before such agency. The lifetime bar contained in Public Officers Law §73(8)(a)(ii) states: No person who has served as a state officer or employee shall after the termination of such service or employment appear, practice, communicate or otherwise render services before any state agency or receive compensation for any such services rendered by such former officer or employee on behalf of any person, firm, corporation or other entity in relation to any case, proceeding, application or transaction with respect to which such person was directly concerned and in which he or she personally participated during the period of his or her service or employment, or which was under his or her active consideration. DISCUSSION These above restrictions set the ground rules for what individuals may do with the knowledge, experience and contacts gained from public service after they leave their employment with a State agency. The two-year bar prohibits former State officers and employees from appearing, practicing or rendering services for compensation in relation to any case, proceeding, application or other matter before their former agency for two years following their separation from State service. A second provision, known as the “lifetime bar,” prohibits former State officers and employees from appearing, practicing, communicating or rendering services before any State agency for compensation in relation to any case, proceeding, application or transaction with respect to which they were directly concerned and in which they personally participated during the period of their State service, or which was under their active consideration during that period. Public Officers Law §73(8)(a)(i) bars an employee who leaves State government from engaging in specified activities before his or her former agency or agencies for a two-year period. Generally, an individual has only one former agency, but the Commission has, in prior opinions, concluded that under certain circumstances, an employee may have more than one former agency (see, e.g., Advisory Opinion Nos. 90-22 and 90-12). For example, in Advisory Opinion No. 95-19, the Commission considered the matter of a State agency head who, during two and a half years of his period of service at the agency, provided, on a regular basis, assistance to the Governor on issues unrelated to the agency. He was neither paid by the Executive Chamber for his work nor was he appointed to an Executive Chamber position or title. Based on the level of responsibility exercised by the individual, his regular and continuing responsibility working for the Governor and the duration of the assignment, the Commission concluded that one of the individual’s former agencies was the Executive Chamber. It noted that the revolving door restrictions apply when it can be shown that there is a “continuing service” to a State agency, even where the employee is not compensated by the agency. In Advisory Opinion No. 95-33, the Commission considered whether officers and employees of the MTA should be considered employees of only the MTA or, alternatively, all of the MTA’s affiliated agencies for purposes of determining their former agency. The Commission held that for other than certain “senior” employees, the former agency of the MTA employees would be the MTA only.2 For senior employees, the Commission held that, “[t]he heads of the MTA’s 11 departments and the directors who are their immediate subordinates, whose current responsibilities include actively and routinely managing significant projects or matters involving one or more MTA affiliates or subsidiaries may be considered to be an employee of the MTA and the other MTA entity. This determination shall be made on a case-by-case basis.”3 In Advisory Opinion No. 99-1, the former agency of a senior MTA employee who had significant involvement with the capital programs of the TA would be the MTA and the TA, given the individual’s job responsibilities. Applying these precedents to [the requesting individual’s] case and noting that he served as [ ] of the MTA’s All-Agency Deferred Compensation Plan and Lead Trustee for the MTA’s Excess Liability Fund, the Commission finds that [the requesting individual] provided “continuing service” to the MTA on a significant and regular basis, and therefore, the MTA, in addition to the LIRR, is one of his former agencies for purposes of the two-year bar. Concerning the other MTA affiliated agencies, the Commission notes that [the requesting individual] from time-to-time, in his duties as [a senior official] for the LIRR, was involved with various projects and had intermittent contact with these entities. For example, the Atlantic Terminal project was shared with the TA, and [the requesting individual] was involved in its planning and the renovation.
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