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HomeMy WebLinkAbout1528 StoudtIn Re: Terry Stoudt, Respondent File Docket: X -ref: Date Decided: Date Mailed: Before: Louis W. Fryman, Chair John J. Bolger, Vice Chair Donald M. McCurdy Nicholas A. Colafella Mark Volk 08 -045 Order No. 1528 7/22/09 8/4/09 This is a final adjudication of the State Ethics Commission. Procedurally, the Investigative Division of the State Ethics Commission conducted an investigation regarding possible violation(s) of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq., by the above -named Respondent. At the commencement of its investigation, the Investigative Division served upon Respondent written notice of the specific allegations. Upon completion of its investigation, the Investigative Division issued and served upon Respondent a Findings Report identified as an "Investigative Complaint." A Stipulation of Findings and a Consent Agreement waiving an evidentiary hearing were subsequently submitted by the parties to the Commission for consideration. The Stipulated Findings are set forth as the Findings in this Order. The Consent Agreement has been approved. This adjudication of the State Ethics Commission is issued under the Ethics Act and will be made available as a public document thirty days after the mailing date noted above. However, reconsideration may be requested. Any reconsideration request must be received at this Commission within thirty days of the mailing date and must include a detailed explanation of the reasons as to why reconsideration should be granted in conformity with 51 Pa. Code § 21.29(b). A request for reconsideration will not affect the finality of this adjudication but will defer its public release pending action on the request by the Commission. The files in this case will remain confidential in accordance with the Ethics Act. Stoudt, 08 -045 Page 2 I. ALLEGATIONS: That Terry Stoudt, a public official /public employee in his capacity as Supervisor for North Whitehall Township, Lehigh County, violated Sections 1103(a) and 1105(b)(5) of the State Ethics Act (Act 93 of 1998), 65 Pa.C.S. §§ 1103(a) and 1105(b)(5), when he used the authority of his office for private pecuniary benefit by receiving compensation as Director of Community Affairs for attending meetings of the Board of Supervisors during his regular working hours and when he failed to list all sources of income in excess of $1,300.00 on his Statement of Financial Interests form filed for the 2003 calendar year. II. FINDINGS: 1. Terry Stoudt has served as a North Whitehall Township, Lehigh County Supervisor since at least 1993. a. North Whitehall Township is designated a Township of the Second Class governed by a three (3) member Board of Supervisors. b. All three (3) Supervisors are employed by the Township on a full -time basis. 2. Stoudt has been employed as the Township's Director of Community Affairs since at least 2003. 3. North Whitehall Township records include a job description dated January 8, 2008, for the position of Director of Community Affairs and Recreation. Stoudt has held this position since at least 2003. a. The primary functions of the Director of Community Affairs and Recreation are to implement policies as established by the Board of Supervisors, including management of Community Affairs office staff, and be responsible for recreation programs, coordination of athletic fields, as well as civic functions and programs. b. Major duties and responsibilities for the position include: 1. Authorize purchase of administrative supplies, materials and furnishings, as required. 2. Propose improvements, equipment, and upkeep of playground and recreation areas. 3. Oversee the Zoning, Planning and Permits /Inspections functions. 4. Develop programs and activities for township youth and residents; solicit support and involvement from the community. 5. Monitor recreation programs such as baseball, softball, soccer, volleyball, basketball, etc., to furnish and coordinate facilities. 6. Coordinate recreation programs schedules and activities with respective leagues, for organizations, and or groups. 7. Administer Human Resources services. 8. Inspect ball fields for scheduled use; coordinate with Facilities Team Leader and Public Works Director. 9. Oversee and coordinate township census. 10. Serve as liaison to Township Engineer, Planning Commission and Recreation Board. 11. Monitor public water, sewer, and waste water concerns. 12. Compile and submit cost estimates required for the preparation of the departmental capital and operating budget. 13. Formulate policies and procedures and seek Board of Supervisor approval for carrying out the duties of office functions. Stoudt, 08 -045 Page 3 14. Recommend hiring and coordinate training of office and support staff. 15. Conduct employee evaluation and performance improvement plans. 16. Respond to concerns and suggestions from township residents and businesses. 17. Other duties as assigned. 4. Compensation for Supervisors working for the Township on a full -time basis was annually set by the Township Board of Auditors consistent with the employee handbook. a. Compensation was set at the following hourly rates per position: Year Position 2009 Community Services Coordinator Director of Community Affairs & Recreation Director of Public Works 2008 Community Services Coordinator Director of Community Affairs & Recreation Director of Public Works 2007 Facilities Foreman Director of Community Affairs & Recreation Director of Public Works 2006 Facilities Foreman Director of Community Affairs Director of Public Works 2005 Facilities Foreman Director of Community Affairs Director of Public Works 2004 Facilities Foreman Director of Community Affairs Director of Public Works 2003 Facilities Foreman Director of Community Affairs Director of Public Works & Recreation & Recreation & Recreation & Recreation Rate 25.17 $27.21 $29.41 $25.17 $27.21 $29.41 $24.56 $26.35 $28.28 $23.84 $25.58 $27.39 $22.92 $24.64 $26.34 $22.20 $23.86 $25.51 $21.45 $23.05 $24.65 Supervisor Ronald Heintzelman Terry Stoudt Ronald Stahley Ronald Heintzelman Terry Stoudt Ronald Stahley Ronald Heintzelman Terry Stoudt Ronald Stahley Ronald Heintzelman Terry Stoudt Ronald Stahley Ronald Heintzelman Terry Stoudt Ronald Stahley Ronald Heintzelman Terry Stoudt Ronald Stahley Ronald Heintzelman Terry Stoudt Ronald Stahley b. Other approved compensation included in the employee handbook was medical coverage, life insurance, retirement programs, workers compensation, and paid sick, personal and vacation days. 5. Supervisors may not receive compensation as a working Township employee for the performance of duties as an elected official. 6. Members of the North Whitehall Township Board of Supervisors, including Stoudt, received annual compensation of approximately $3,250.08 for their service as an elected Township Supervisor. a. The $3,250.08 in annual compensation is to cover all aspects of the position of Supervisor, including attendance at workshop sessions, bid openings, executive sessions, and regular and special meetings of the Board of Supervisors. Stoudt, 08 -045 Page 4 7. The North Whitehall Township Board of Supervisors typically held at least one regular and one workshop session meeting per month through September 2008. a. Special meetings, bid openings, and executive session meetings are held on an as needed basis. b. Workshop sessions were generally held during normal business hours of the Township. 1. Supervisors employed by the Township generally worked a schedule of 7:00 a.m. to 3:00 p.m. Monday through Friday. 8. Since 2003 the North Whitehall Township Board of Supervisors has routinely held bid openings, workshop sessions and emergency meetings during normal business hours. a. The practice of holding workshop sessions during normal business hours was discontinued after September 16, 2008. 9. Township employees including the working supervisors record their daily start and end times using a time clock. a. Employee time cards are compiled by Secretary /Treasurer Brenda Norder. b. The normal work hours for the Supervisors working on a full -time basis for the Township is Monday through Friday, 7:00 a.m. to 3:30 p.m. with a one - half hour lunch break. 10. Since 2003 Stoudt routinely attended Township bid openings, special meetings, and other Supervisory related meetings held while simultaneously being compensated as an hourly Township employee. a. Stoudt did not clock out to attend these meetings. b. Stoudt received his hourly wage as a Township employee in addition to his wages as a Supervisor to attend these meetings. c. Stoudt discontinued this practice in September 2008. 11. Between August 2003 and September 10, 2008, Stoudt attended at least 92 meetings during Stoudt's regular working hours resulting in compensation of at least $7,859.48. Total meetings and compensation per year is as follows: Calendar Meetings Compensation 2003 August on 8 $ 547.45 2004 17 $1,151.28 2005 17 $1,506.12 2006 16 $1,579.60 2007 23 $1,973.00 2008 through September 11 $1,102.03 92 $7,859.48 12. The issue of compensation being received by the working supervisors was reviewed by Township Solicitor Lisa A. Young in 2005. This review was done by Young for the Township Board of Auditors. Young's research included compensation and benefits the Township's working supervisors could receive. Stoudt, 08 -045 Page 5 13. On December 28, 2005, Township Solicitor Lisa A. Young, Esq. issued a Solicitor's Opinion to the Board of Auditors regarding "compensation and benefits" to address compensation issues raised regarding the working supervisors. Young's opinion provided information she took from the Second Class Township Code relating to compensation and other benefits for the working supervisors. Solicitor Young made specific reference to her belief that the Auditors can offer and set compensation including salary, vacation time, sick days and personal days. 14. Township Solicitor Lisa A. Young did not provide the Township Board of Supervisors or Auditors with any advice or opinion on whether a working Supervisor could receive compensation as an hourly employee to attend meetings relating to [his or her] position of Supervisor. a. a. Young's opinion related primarily to health insurance coverage for the Supervisors and their spouses. 15. After September 16, 2008, the North Whitehall Township Board of Supervisors discontinued the practice of holding workshop meetings during normal working hours when they simultaneously were receiving wages as a Township employee. 16. On December 3, 2008, Terry Stoudt issued personal check number 132 in the amount of $11,000.00 to North Whitehall Township. a. This check was issued to reimburse the Township for wages he received for attending meetings not consistent with the Second Class Township Code. b. Stoudt did not identify how he calculated the amount to reimburse the Township. 17. Stoudt's check was part of a $32,459.66 deposit made into a Township account no. ending in 8220 at the Neff National Bank on December 4, 2008. 18. Minutes from the North Whitehall Township Board of Supervisors meeting held on December 3, 2008, included the following recorded discussion on the reimbursement of wages by the Supervisors: a. As a result of discovering that attending dayti ne workshops, while punched in as an employee, was a conflict with the 2 Class Township Code, each Supervisor remitted a check for repayment of wages earned. Supervisor Heintzelman paid $10,109.66 and Supervisor Stahley and Stoudt each paid $11,000.00 on account until the exact amount is determined. All Supervisors apologized for the conflict noting it was not done intentionally, but as a service to residents and many of the meetings were directly related to their working titles." THE FOLLOWING FINDINGS RELATE TO ALLEGATIONS THAT STOUDT FAILED TO LIST ALL SOURCES OF INCOME IN EXCESS OF $1,300.00 ON HIS STATEMENT OF FINANCIAL INTERESTS FORM FILED FOR THE 2003 CALENDAR YEAR. 19. Stoudt, in his official capacity as a North Whitehall Township Supervisor, was annually required to file a Statement of Financial Interests form by May 1 containing information for the prior calendar year. 20. Statement of Financial Interests Forms on file with North Whitehall Township include the following filings for Stoudt covering calendar years 2003 through 2007: Stoudt, 08 -045 Page 6 Calendar Year: 2007 Filed: 01/24/08 on SEC Form SEC -1 REV. 01/08 Position: Supervisor Occupation: Township Supervisor Real Estate Interests: 1102 Linden Street, Allentown, PA 18102 Creditors: None Direct /indirect income: North Whitehall Township All other financial interests: None Calendar Year: 2006 Filed: 01/04/07 on SEC Form SEC -1 REV. 01/07 Position: Supervisor Occupation: Township Supervisor Real Estate Interests: 1102 Linden Street, Allentown, PA 18102 Creditors: None Direct /indirect income: North Whitehall Township All other financial interests: None Calendar Year: 2005 Filed: 02/01/06 on SEC Form SEC -1 REV. 01/06 Position: Supervisor Occupation: Township Supervisor Real Estate Interests: 1102 Linden Street, Allentown, PA 18102 Creditors: None Direct /indirect income: North Whitehall Township All other financial interests: None Calendar Year: 2004 Filed: 02/09/05 on SEC Form SEC -1 REV. 01/05 Position: Supervisor Occupation: Township Supervisor Real Estate Interests: 1102 Linden Street, Allentown, PA 18102 Creditors: None Direct /indirect income: North Whitehall Township All other financial interests: None Calendar Year: 2003 Filed: 03/12/04 on SEC Form SEC -1 REV. 01/04 Position: Supervisor Occupation: Township Supervisor Real Estate Interests: 1102 Linden Street, Allentown, PA 18102 Creditors: None Direct /indirect income: None All other financial interests: None 21. Stoudt failed to list all sources of income in excess of $1,300.00 on his SFI filed for the 2003 calendar year. 22. Stoudt received wages in excess of $1,300.00 annually as an employee of and Supervisor for the Township, during each calendar year including 2003. 23. On March 16, 2009, the State Ethics Commission received amended Statement of Financial Interests forms for calendar years 2002 through 2007 filed by Stoudt. a. These amended forms were filed to address the noted Statement of Financial [Interests] deficiencies. Stoudt, 08 -045 Page 7 b. Stoudt's amended filings as outlined in finding no. 23 disclose additional sources of income which he had previously failed to disclose on Statements of Financial Interests filed for 2003 to 2007 calendar years. 1. The amended Statements of Financial Interests included rental income and the Lehigh Valley Athletic Conference. III. DISCUSSION: As a Township Supervisor for North Whitehall Township ( "Township "), Lehigh County, since at least 1993, Respondent Terry Stoudt (hereinafter also referred to as "Respondent," "Respondent Stoudt," and "Stoudt ") has been a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. The allegations are that Respondent Stoudt violated Sections 1103(a) and 1105(b)(5) of the Ethics Act when he, as a Township Supervisor, used the authority of his office for private pecuniary benefit by receiving compensation as Director of Community Affairs for attending meetings of the Township Board of Supervisors ( "Board ") during his regular working hours and when he failed to list all sources of income in excess of $1,300.00 on his Statement of Financial Interests ( "SFI ") form filed for the 2003 calendar year. Pursuant to Section 1103(a) of the Ethics Act, a public official /public employee is prohibited from engaging in conduct that constitutes a conflict of interest: § 1103. Restricted activities (a) Conflict of interest. —No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). The term "conflict of interest" is defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 Pa.C.S. § 1102. Section 1103(a) of the Ethics Act prohibits a public official /public employee from using the authority of public office /employment or confidential information received by Stoudt, 08 -045 Page 8 holding such a public position for the private pecuniary benefit of the public official /public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Section 1105(b) of the Ethics Act and its subsections detail the financial disclosure that a person required to file the SFI form must provide. Subject to certain statutory exceptions not applicable to this matter, Section 1105(b)(5) of the Ethics Act requires the filer to disclose on the SFI the name and address of any direct or indirect source of income totaling in the aggregate $1,300 or more. As noted above, the parties have submitted a Consent Agreement and Stipulation of Findings. The parties' Stipulated Findings are set forth above as the Findings of this Commission. We shall now summarize the relevant facts as contained therein. Respondent has served as a Township Supervisor since at least 1993. All three Township Supervisors are employed by the Township on a full -time basis. Respondent has been employed as the Township's Director of Community Affairs since at least 2003. The Township Auditors have set the hourly rates of compensation for the Township Supervisors as Township employees as detailed in Fact Finding 4 a. Each Township Supervisor, including Respondent, has received annual compensation of approximately $3,250.08 for service as an elected Township Supervisor. Since 2003 Respondent routinely attended Township bid openings, special meetings, and other Supervisor related meetings while simultaneously being compensated as an hourly Township employee. Respondent did not clock out to attend these meetings. Respondent discontinued this practice in September 2008. Between August 2003 and September 10, 2008, Respondent attended at least 92 meetings during his regular working hours, for which he received compensation as a Township employee of at least $7,859.48. On December 3, 2008, Respondent issued personal check number 132 in the amount of $11,000.00 to the Township to reimburse the Township for wages he received as a Township employee for attending meetings as a Township Supervisor. Respondent's check was part of a $32,459.66 deposit made into a Township account on December 4, 2008. Minutes from the Board meeting held on December 3, 2008, included the following recorded discussion regarding the reimbursement of wages by the Supervisors: As a result of discovering that attending daytime workshops while punched in as an employee, was a conflict with the 2" Class Township Code, each Supervisor remitted a check for repayment of wages earned. Supervisor Heintzelman paid $10,109.66 and Supervisor Stahley and Stoudt each paid $11,000.00 on account until the exact amount is determined. All Supervisors apologized for the conflict noting it was not done intentionally, but as a service to residents and many of the meetings were directly related to their working titles. Fact Finding 18 a. As for Respondent's SFI forms, the parties have stipulated that Respondent failed to list all sources of income in excess of $1,300.00 on his SFI filed for the 2003 calendar year. Respondent received wages in excess of $1,300.00 from the Township in 2003, but Stoudt, 08 -045 Page 9 Respondent did not list the Township as a source of income on his SFI for the 2003 calendar year. In March 2009 this Commission received amended SFI forms for calendar years 2002 through 2007 filed by Respondent, disclosing additional sources of income that Respondent had previously failed to disclose on SFIs filed for the 2003 to 2007 calendar years. Having highlighted the Stipulated Findings and issues before us, we shall now apply the Ethics Act to determine the proper disposition of this case. The parties' Consent Agreement sets forth a proposed resolution of the allegations as follows: 3. The Investigative Division will recommend the following in relation to the above allegations: a. That an unintentional violation of Section 1103(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. §1103(a), occurred in relation to Stoudt's receipt of compensation as Director of Community Affairs for attending meetings of the Board of Supervisors during his regular working hours. b. That an unintentional violation of Section 1105(b)(5) of the Public Official and Employee Ethics Act, 65 Pa.C.S. §1105(b)(5), occurred when Stoudt failed to list all sources of income in excess of $1,300.00 on his Statements of Financial Interests form for calendar year 2003. 4. The Investigative Division of the State Ethics Commission will recommend that no restitution be paid as Stoudt has repaid North Whitehall Township an amount in excess of the amount which was alleged as his private pecuniary gain. 5. The Investigative Division of the State Ethics Commission will recommend that no amended Statement of Financial Interests form for calendar year 2003 need be filed as Stoudt has already filed an amended form with North Whitehall Township. 6. The Investigative Division will recommend that the State Ethics Commission take no further action in this matter; and make no recommendations to any law enforcement or other authority to take action in this matter. Consent Agreement, at 1 -2. In considering the Consent Agreement, we accept the parties' recommendation for a finding that an unintentional violation of Section 1103(a) of the Ethics Act occurred in relation to Respondent's receipt of compensation as Township Director of Community Affairs for attending meetings of the Board during his regular working hours. But for the fact that Respondent was a Township Supervisor, he would not have been in a position to claim hours and receive wages as the Township Director of Community Affairs for duties that were related to his position as a Township Supervisor. Stoudt, 08 -045 Page 10 Such uses of authority of office resulted in a private pecuniary benefit to Respondent consisting of unauthorized compensation as a Township employee of at least $7,859.48. Although intent is not a requisite element of a violation of the Ethics Act, see, Yocabet v. State Ethics Commission, 531 A.2d 536 (Pa. Commw. Ct. 1987), it would appear that the aforesaid violation was unintentional. Accordingly, we hold that an unintentional violation of Section 1103(a) of the Ethics Act occurred in relation to Respondent's receipt of compensation as Township Director of Community Affairs for attending meetings of the Board during his regular working hours. See, R.H. v. State Ethics Commission, 673 A.2d 1004 (Pa. Commw. Ct. 1996); Mendez, Order 1481; Hahn, Order 1480; Harton, Order 1421; Seamans, Order 1411; Johnson, Order 1187. We also accept the recommendation of the parties for a finding that an unintentional violation of Section 1105(b)(5) of the Ethics Act occurred when Respondent failed to list all sources of income in excess of $1,300.00 on his SFI form for calendar year 2003. The parties have stipulated that Respondent failed to list all such sources of income on the form, but that Respondent has since filed an amended form to address such deficiencies. We hold that an unintentional violation of Section 1105(b)(5) of the Ethics Act occurred when Respondent failed to list all sources of income in excess of $1,300.00 on his SFI form for calendar year 2003. The Investigative Division has recommended that no restitution be ordered because Respondent has already repaid the Township an amount in excess of the amount alleged as his private pecuniary gain. The Investigative Division has further recommended that there be no requirement for the filing of an amended SFI form for calendar year 2003 as Respondent has already filed such an amended form with the Township. We determine that the Consent Agreement submitted by the parties sets forth the proper disposition for this case, based upon our review as reflected in the above analysis and the totality of the facts and circumstances. In that Respondent has already repaid the Township an amount in excess of the amount alleged as his private pecuniary gain and has already filed with the Township an amended SFI for calendar year 2003, we will take no further action in this case, which is closed. IV. CONCLUSIONS OF LAW: 1. As a Township Supervisor for North Whitehall Township ( "Township "), Lehigh County, since at least 1993, Respondent Terry Stoudt ( "Staudt ") has been a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1101 et seq. 2. Stoudt unintentionally violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), in relation to Stoudt's receipt of compensation as Township Director of Community Affairs for attending meetings of the Township Board of Supervisors during his regular working hours. 3. An unintentional violation of Section 1105(b)(5) of the Ethics Act, 65 Pa.C.S. § 1105(b)(5), occurred when Stoudt failed to list all sources of income in excess of $1,300.00 on his Statement of Financial Interests form for calendar year 2003. In Re: Terry Stoudt, Respondent ORDER NO. 1528 File Docket: 08 -045 Date Decided: 7/22/09 Date Mailed: 8/4/09 1 As a Township Supervisor for North Whitehall Township ( "Township "), Terry Stoudt ( "Staudt ") unintentionally violated Section 1103(a) of the Public Official and Employee Ethics Act ( "Ethics Act "), 65 Pa.C.S. § 1103(a), in relation to his receipt of compensation as Township Director of Community Affairs for attending meetings of the Township Board of Supervisors during his regular working hours. 2. An unintentional violation of Section 1105(b)(5) of the Ethics Act, 65 Pa.C.S. § 1105(b)(5), occurred when Stoudt failed to list all sources of income in excess of $1,300.00 on his Statement of Financial Interests ( "SFI ") form for calendar year 2003. 3. In that Stoudt has already repaid the Township an amount in excess of the amount alleged as his private pecuniary gain and has already filed with the Township an amended SFI for calendar year 2003, this Commission will take no further action in this case, which is closed. BY THE COMMISSION, Louis W. Fryman, Chair