Subchapter I. EMPLOYE CONFLICT OF INTEREST

§ 86.231. Purpose.

 This subchapter sets forth the restrictions on each employe of the Department who performs a function or duty under the coal mining laws to prevent direct or indirect financial interest in an underground or surface coal mining operation or facility, or Federally-funded abandoned mine lands reclamation project.

 The following words and terms, when used in this subchapter, have the following meanings, unless the context clearly indicates otherwise:

   Coal mining laws—Those provisions of the Surface Mining Conservation and Reclamation Act (52 P. S. § §  1396.1—1396.31), The Clean Streams Law (35 P. S. § §  691.1—691.1001), the Air Pollution Control Act (35 P. S. § §  4001—4015), the Dam Safety and Encroachments Act (32 P. S. § §  6018.101—6018.1003), the Coal Refuse Disposal Control Act (52 P. S. § §  30.51—30.66), the Bituminous Coal Mine Subsidence and Land Conservation Act (52 P. S. § §  1406.1—1406.21) and the Solid Waste Management Act (35 P. S. § §  6018.101—6018.1003), related to the regulation of surface and underground coal mines and facilities, and The Land and Water Conservation and Reclamation Act (32 P. S. § §  5101—5121) related to abandoned mine lands reclamation for which Federal grants have been made under Title IV of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C.A. § §  1231—1243).

   Coal mining operation—The business of developing, producing, preparing or loading bituminous coal, subbituminous coal, anthracite or lignite, or of reclaiming the areas upon which the mining activity occurs.

   Department—The Department of Environmental Resources.

   Direct financial interest—Ownership or part ownership by an employe of lands, stocks, bonds, debentures, warrants, partnership shares or other holdings and also means another arrangement where the employe may benefit from his holding in or salary from coal mining operations. Direct financial interests include employment, pensions, creditor, real property and other financial relationships.

   Employe—A person employed by the Department who performs a function or duty under the coal mining laws.

   Indirect financial interest—The same financial relationships as for direct ownership, where the employe reaps the benefits of the interests held by his spouse, minor child and other relatives, including in-laws, residing in the employe’s home. The employe will not be deemed to have an indirect financial interest if there is no relationship between the employe’s functions or duties and the coal mining operation in which the spouse, minor children or other resident relatives hold a financial interest.

   Performing any function or duty under the coal mining laws—Those decisions or actions, which if performed or not performed by an employe, affect the programs conducted under the coal mining laws.

   Prohibited financial interest—A direct or indirect financial interest in a coal mining operation.

 (a)  The Department employes performing a function or duty under the coal mining laws shall:

   (1)  Have no direct or indirect financial interest in a coal mining operation.

   (2)  File a fully completed statement of employment and financial interest, on a form provided by the Department, upon beginning or continuing employment with the Department and annually thereafter on a specified filing date.

   (3)  Take action promptly to remedy any and all prohibited financial interests determined as provided in this subchapter.

 (b)  Compliance with this subchapter is a condition upon the employment of all employes who perform any function or duty under the coal mining laws.

 (c)  The Department will:

   (1)  Provide advice, assistance and guidance to employes required to file a statement of employment and financial interest.

   (2)  Promptly review the statement of employment and financial interests and supplements, if any, filed by each employe, to determine if the employe has correctly identified those listed employment and financial interests which constitute a direct or indirect financial interest in an underground or surface coal mining operation.

   (3)  Resolve prohibited financial interest situations by ordering or initiating remedial action.

   (4)  Certify on each statement that review has been made, that prohibited financial interests, if any, have been resolved, and that no other prohibited interests have been identified from the statement.

   (5)  Submit to the Director of the Office of Surface Mining, United States Department of Interior, such statistics and information as he may request to enable preparation of an annual report to Congress on implementation of these conflict of interest requirements, maintaining, however, appropriate confidentiality.

   (6)  Submit to the Director of the Office of Surface Mining, United States Department of Interior, the initial listing and the subsequent annual listings of positions within the Department for which employes perform functions or duties under the coal mining laws.

   (7)  Furnish a blank statement of employment and financial interests 45 days in advance of the filing date established by the Department to each employe required to file a statement.

   (8)  Inform annually each employe required to file a statement with the Department of the name, address and telephone number of the person whom they may contact for advice and counseling.

 (a)  An employe who fails or refuses to file a statement of employment and financial interests by the prescribed filing date, or who fails or refuses to remedy a prohibited financial interest determined as provided in this subchapter, shall be subject to disciplinary action including but not limited to reassignment, transfer or termination of employment.

 (b)  An employe who fails or refuses to remedy a prohibited financial interest determined as provided in this subchapter shall be subject to:

   (1)  Criminal penalties as provided in section 1928-A of The Administrative Code of 1929 (71 P. S. §  510-28), which provides:

   ‘‘No employe of the Department of Environmental Resources performing any function or duty within the scope of activities covered by the Surface Mining Control and Reclamation Act of 1977, Public Law 95-87 (95th Congress) shall have a direct or indirect financial interest in any underground or surface coal mining operating as defined by this act. Whoever knowingly violates the provisions of this section shall, upon conviction, be punished by a fine of not more than two thousand five hundred dollars ($2,500) or by imprisonment of not more than one (1) year, or both.’’

   (2)  Criminal penalties as provided in section 517(g) of the Surface Mining Control and Reclamation Act of 1977 (30 U.S.C.A. §  1267(g)), which provides:

   ‘‘No employe of the State regulatory authority performing any function or duty under this Act shall have a direct or indirect financial interest in any underground or surface coal mining operation. Whoever knowingly violates the provisions of this subsection shall, upon conviction, be punished by a fine of not more than $2,500, or by imprisonment of not more than one year, or by both.’’

 (a)  An employe who performs a function or duty under the coal mining laws is required to file a statement of employment and financial interests. An employe who is no longer employed by the Department at the time a filing is due is not required to file a statement.

 (b)  The Secretary will prepare a list of those positions within the Department that do not involve performance of any functions or duties under the coal mining laws. Only those employes who are employed in a listed organizational unit or who occupy a listed position will be exempted from the requirement to file a statement of employment and financial interests.

 (c)  The Secretary of the Department may revise the listing by the addition or deletion of positions if the Secretary determines the revisions are required to carryout the purpose of this subchapter. Additions to and deletions from the listing of positions are effective upon notification to the incumbents of the positions added or deleted.

 (a)  Employes performing functions or duties under the coal mining laws shall file a completed statement of employment and financial interests annually, on such date as specified by the Secretary.

 (b)  New employes hired, appointed or transferred to perform functions or duties under the coal mining laws shall file a completed statement of employment and financial interests at the time of entrance to duty.

 Completed statements of employment and financial interests shall be filed with a three-person review committee established by the Secretary, except that the Secretary shall file a statement with the Director of the Office of Surface Mining, United States Department of Interior. The review committee shall have the responsibility and authority to review the completed statements, to require employes to take remedial action to eliminate prohibited financial interests and to recommend to the Secretary penalties for violations of this subchapter.

 (a)  Each employe shall report information required on the statement of employment and financial interests of the employe, the employe’s spouse, minor children or other relatives who are full-time residents of the employe’s home. The report shall be on OSM Form 705-1 as provided by the Department. The statement consists of three major parts:

   (1)  A listing of financial interests, including employment, security, real property, creditor and other financial interests held during the course of the preceding year.

   (2)  A certification that none of the listed financial interests represent a direct or indirect financial interest in an underground or surface coal mining operation except as specifically identified and described by the employe as part of the certificate.

   (3)  A certification by the chairperson of the review committee that the form was reviewed, that prohibited interests have been resolved and that no other prohibited interests have been identified from the statement.

 (b)  The statement will set forth the following information regarding financial interest:

   (1)  Employment. A continuing financial interests in business entities and nonprofit organizations through a pension or retirement plan, shared income, salary or other income arrangement as a result of prior or current employment. The employe, the employe’s spouse or other resident relative is not required to report a retirement plan from which that person will receive a guaranteed income. A guaranteed income is one which is unlikely to be changed as a result of actions taken by the Department.

   (2)  Securities. A financial interest in business entities and nonprofit organizations through ownership of stock, stock options, bonds, securities or other arrangements, including trusts. An employe is not required to report mutual funds, investment clubs or regulated investment companies not specializing in underground and surface coal mining operations.

   (3)  Real property. Ownership, lease, royalty or other interests or rights in lands or minerals. Employes are not required to report lands developed and occupied for personal residence.

   (4)  Creditors. Debts owed to business entities and nonprofit organizations. Employes are not required to report debts owed to financial institutions—banks, savings and loan associations, credit unions, and the like—which are chartered to provide commercial or personal credit. Also excluded are charge accounts and similar short-term debts for current and ordinary household and living expenses.

 (c)  The statement will provide for a signed certification by the employe that to the best of his knowledge:

   (1)  None of the listed financial interests represent an interest in an underground or surface coal mining operation except as specifically identified and described as exceptions by the employe as part of the certificate.

   (2)  The information shown on the statement is true, correct and complete.

 (d)  The exceptions shown in the employe certification of the form shall provide enough information for the review committee to determine the existence of a direct or indirect financial interest. Accordingly, the exceptions should:

   (1)  List the financial interests.

   (2)  Show the number of shares, estimated value or annual income of the financial interests.

   (3)  Include other information which the employe believes should be considered in determining whether or not the interest represents a prohibited interest.

 (e)  An employe shall be expected to:

   (1)  Have complete knowledge of personal involvements in business enterprises such as a sole proprietorship and partnership, outside employment and the outside employment of the spouse and other covered relatives.

   (2)  Be aware of the information contained in the annual financial statement or other corporate or business reports routinely circulated to investors or routinely made available to the public.

   The provisions of this §  86.238 adopted December 19, 1980, 10 Pa.B. 4789, effective July 31, 1982, 12 Pa.B. 2382; amended July 30, 1982, 12 Pa.B. 2473, effective July 31, 1982, 12 Pa.B. 2382.

 (a)  Except as provided in subsection (c), employes may not solicit or accept, directly or indirectly, any gift, gratuity, favor, entertainment, loan or any other thing of monetary value, from a company which:

   (1)  Conducts or is seeking to conduct coal mining operations or activities that are regulated by the Department.

   (2)  Has interests, operations or activities that may be substantially affected by the performance or nonperformance of the employe’s official duty.

 (b)  Except as provided in subsection (c), gifts and gratuities shall be immediately reported to both the employe’s supervisor and the review committee. Failure to report such gifts and gratuities shall constitute a major violation of this subchapter.

 (c)  The prohibitions in subsection (a) do not apply in the context of obvious family or personal relationships, such as those between the parents, children or spouse of the employe and the employe, when the circumstances make it clear that it is those relationships rather than the business of the persons concerned which are the motivating factors. An employe may accept unsolicited advertising or promotional material, such as pens, pencils, note pads, calendars and other items of nominal value.

 (a)  The review committee will review statements of employment and financial interests to determine if an employe has a prohibited financial interest.

 (b)  If the review committee finds that an employe has a prohibited financial interest, it shall notify the employe in writing and require that the prohibited financial interest be remedied within a period of time not to exceed 90 days.

 (c)  Remedial action may include any one of the following:

   (1)  Reassignment or transfer of the employe to a position which includes no function or duty under the coal mining laws.

   (2)  Divestiture of the prohibited financial interest.

   (3)  Termination of employment.

   (4)  Other action which eliminates the prohibited financial interest or eliminates the situation which creates the conflict.

 (d)  If an employe fails to remedy a prohibited financial interest or fails to file a completed statement of employment and financial interests, the review committee shall notify the Secretary of the Department and the Director of the Office of Surface Mining, United States Department of Interior. The Secretary, the Director, or both, will apply the penalties provided in this subchapter.

 The statements of employment and financial interests will be held in strict confidence. The statements will only be available for examination by the Secretary of the Department, the review committee, an arbitrator appointed as provided in §  86.242 (relating to appeal procedure), the Director of the Office of Surface Mining, United States Department of Interior, Federal auditors and legal counsel for the Department and the Department of Interior. If a penalty is imposed under this subchapter, the statement of employment and financial interests may be used as evidence.

 (a)  If an employe disputes a decision of the review committee, the employe may request an informal meeting with the review committee to resolve the dispute.

 (b)  If, after meeting with the review committee, the employe still disputes the decision of the review committee, the employe may request the Department to obtain an independent arbitrator to hear the employe’s appeal of the decision. The employe’s appeal must be made within 30 days of receipt of the decision of the review committee. The decision of the arbitrator shall be final.

   The provisions of this §  86.242 adopted December 19, 1980, 10 Pa.B. 4789, effective July 31, 1982, 12 Pa.B. 2382; amended July 30, 1982, 12 Pa.B. 2473, effective July 31, 1982, 12 Pa.B. 2382.

   This chapter is not preempted by the Federal Surface Mining Control and Reclamation Act of 1977 (30 U.S.C.A. § §  1201—1328) since the act allows for State regulations providing for more stringent land use and environmental control. Budinsky v. Department of Environmental Resources, 819 F.2d 418 (3rd Cir. 1987); cert. denied 484 U. S. 926; reh’g denied 484 U. S. 1083 (U. S. 1988).

   This section cited in 25 Pa. Code §  86.241 (relating to confidentiality).