HomeMy WebLinkAbout1549 Wansacz
In Re: John Wansacz, Jr., : File Docket: 08-033
Respondent : X-ref: Order No. 1549
: Date Decided: 3/25/10
: Date Mailed: 4/9/10
Before: Louis W. Fryman, Chair
John J. Bolger, Vice Chair
Donald M. McCurdy
Raquel K. Bergen
Nicholas A. Colafella
Mark Volk
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.” An Answer was filed and a hearing was requested. 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.
Wansacz, Jr., 08-033
Page 2
I.ALLEGATIONS:
That John Wansacz, Jr., a public official/public employee in his capacity as Director
of Transportation for the Lakeland School District, violated Sections 1103(a), 1103(c),
1103(f), 1104(a), and 1105(b) of the State Ethics Act (Act 93 of 1998), 65 Pa.C.S. §§
1103(a), 1103(c), 1103(f), 1104(a), and 1105(b), when he used the authority of his public
position for the private pecuniary benefit of himself and/or a business with which he is
associated; when he participated in the selection of, recommended and/or awarded
contracts to Kimberly Nemeth and/or NE Student Transportation, a business with which he
is associated, to provide services to the District; when he participated in the selection of,
recommended and/or awarded contracts to NE Student Transportation and/or Kimberly
Nemeth to provide services to the District at a time when he had a reasonable expectation
that he would receive a financial benefit from said entity; when the contracts he
participated in awarding to NE Student Transportation in excess of $500.00 were awarded
without an open and public process; when he accepted payments from NE Student
Transportation and/or Kimberly Nemeth based on the understanding that his official action
would be influenced thereby; and when he participated in the selection of, recommended
and/or awarded contracts to NE Student Transportation in order to fund the purchase of
that entity by Vladimir Schlasta and David Schlasta and when he thereafter received
proceeds from the sale of that entity; when he failed to file Statements of Financial
Interests for the 2006 and 2007 calendar years by May 1, 2007, and May 1, 2008; when,
after filing a Statement of Financial Interests for the 2006 and 2007 calendar years, he
failed to disclose all direct and indirect sources of income in excess of $1,300.00; when he
failed to disclose all direct and indirect sources of income in excess of $1,300.00 on a
Statement of Financial Interest filed for the 2008 calendar year; and that John Wansacz,
Jr., a public official/public employee in his capacity as Transportation Director for the
Carbondale Area School District, Lackawanna County, violated the provisions of the State
Ethics Act (Act 93 of 1998) when he used the authority of his public position for the private
pecuniary benefit of himself and/or a business with which he is associated by participating
in the selection of, recommended and/or awarded contracts to Northeast Student
Transportation, a business with which he is associated, to provide services to the
Carbondale Area School District; when he participated in the selection of, recommended
and/or awarded contracts to Northeast Student Transportation to provide services to the
District at a time when he had a reasonable expectation that he would receive a financial
benefit from said entity; and when the contracts he participated in awarding to Northeast
Student Transportation in excess of $500.00 were awarded without an open and public
process; when he accepted payments from Northeast Student Transportation based on the
understanding that his official action as Transportation Director for the Carbondale Area
School District would be influenced thereby; and when he failed to file a Statement of
Financial Interests for the 2007 calendar year with the School District by May 1, 2008.
II.FINDINGS:
1. John Wansacz, Jr. (Wansacz) has served as the Director of Transportation for the
Lakeland School District (LSD), Lackawanna County since June 22, 2005.
a. Wansacz was appointed by the Board of Directors (Board) to replace
William White who retired from the position.
b. The Lakeland School District’s position of Director of Transportation is a
part-time position which reports to the Superintendent.
c. Wansacz has been annually reappointed to this position by the Board.
d. The position was annually approved in two parts, Director of Transportation
for the upcoming school year and Director of Transportation for the summer.
Wansacz, Jr., 08-033
Page 3
2. The Board took official action during the following meetings on Wansacz’s
appointment and re-appointment as Director of Transportation for the regular school
year and summer sessions on the following dates.
Meeting Date Summer Session Salary School Year Salary
a.
06/22/05 2005 $3,200.00 2005-06 $ 8,800.00
05/17/06 2006 $3,300.00 2006-07 $ 8,900.00
06/27/07 2007 $3,800.00 2007-08 $10,400.00
04/16/08 2008 $3,800.00 2008-09 $10,400.00
3. John Wansacz, Jr. also has served as the Director of Transportation for the
Carbondale Area School District from March 1, 2008, through June 30, 2009.
a. Wansacz was hired at a prorated salary of $14,000.00 per year until June
30, 2009.
b. Prior to Wansacz’s hiring, all transportation matters were handled by
Dominick Famularo, the District’s Superintendent.
c. Wansacz was expected to work 1-2 days per week or the number of hours
necessary to handle the District’s transportation needs.
4. Wansacz was permitted to simultaneously be employed as Transportation Director
for the Lakeland and Carbondale Area School Districts by their respective Boards.
a. Wansacz was expected to work the hours necessary to handle all
transportation issues for both Districts.
b. Wansacz did not have defined working hours for either District.
c. Wansacz did not have a residency requirement for either District.
5. Kimberly Ann Nemeth is the girlfriend of John Wansacz, Jr.
a. The two have had a relationship since at least February 2006.
b. Nemeth and Wansacz have shared a common residence located at
[Redacted Residence Address] since at least January 2007.
c. The property is owned by John Wansacz, Jr.
6. Records of the Lackawanna County Recorder of Deeds reflect John Wansacz, Jr.
purchased real estate commonly identified as [Redacted Residence Address] from
the estate of Stella T. Dluginsky on December 27, 2006.
a. By February 2007, this property served as the common residence for John
Wansacz, Jr. and Kimberly Nemeth.
b. John Wansacz, Jr. has been the sole owner listed on the homeowner’s
insurance policy for this property with Erie Insurance since December 29,
2006 (Policy #Q602909064A).
7. PennDOT driver’s license records include address histories for John Wansacz, Jr.
and Kimberly Ann Nemeth.
a. Wansacz has a current address on file of 1297 Heart Lake Road, Jermyn,
PA 18433, effective April 22, 2002.
Wansacz, Jr., 08-033
Page 4
1. Wansacz never updated his address to [Redacted Residence
Address].
b. Nemeth has a current address on file of [Redacted Residence Address],
effective November 6, 2008.
1. 997 Main Street, Archbald, PA 18403 effective September 3, 2005, to
November 6, 2008.
8. John Wansacz, Jr. and Nemeth began living together at [Redacted Residence
Address] in or around February 2007. (See Finding #98 for further information).
9. On or about March 16, 2007, Kimberly Nemeth obtained a post office box at the US
Postal Services, Jermyn, PA branch.
a. Nemeth obtained the post office box in the name of Northeast Student
Transportation.
b. Nemeth obtained post office box number 56 at the Jermyn, PA branch.
10. The US Postal Service requires a physical address for post office box holders.
a. Since March 16, 2007, the physical location for Kimberly Nemeth on file with
the Jermyn, PA Post Office is [Redacted Residence Address].
11. Kimberly Nemeth individually and/or d/b/a Northeast Student Transportation (NEST)
has used the PO Box 56, Jermyn, PA, [address] for business transactions since
March 16, 2007.
12. Nemeth began providing a student transportation service initially under her name
and later as Northeast Student Transportation, Inc. to LSD within six months of
Wansacz being named Transportation Director for the District.
a. Nemeth purportedly did business with the LSD under her name during the
2005-06 school year.
1. At least two (2) of the vehicles utilized to transport LSD students were
owned by Wansacz.
b. Nemeth utilized the business name Northeast Student Transportation, Inc. to
contract with the LSD for the 2006-07 through 2008-09 school years.
13. Kim Nemeth did not register with the Pennsylvania Department of State to operate a
student transportation business under her name.
14. Nemeth filed Articles of Incorporation for Northeast Student Transportation, Inc.,
997 Main Street, Archbald, PA 18403 on August 18, 2006.
a. Kimberly Ann Nemeth is listed as the sole incorporator.
b. Entity number 3669040 was assigned by the Corporation Bureau for
Northeast Student Transportation, Inc.
15. Nemeth began doing business with the LSD in January and February respectively
of 2006 by providing services for two (2) van routes.
Wansacz, Jr., 08-033
Page 5
a. Nemeth was able to secure these routes as a result of Wansacz using his
position to recommend to the School Board that contracts be awarded to her.
b. This business began by utilizing vehicles owned by Wansacz. (See
Findings #40 and #41.)
16. Wansacz, in his official capacity as Director of Transportation for the Lakeland and
Carbondale Area School Districts, used these positions to recommend to the
School Board that transportation contracts be awarded to Nemeth/NEST.
a. Wansacz recommended the increase of transportation runs to Nemeth d/b/a
Northeast Student Transportation, Inc. at the beginning of each school year.
b. These actions occurred at a time when he and Nemeth were cohabitating
and sharing living expenses.
1. Wansacz received payments from Nemeth subsequent to Nemeth’s
receipt of funds from LSD.
17. As a result of contracts being awarded to Nemeth/NEST, the number of van routes
for Nemeth/NEST increased and the value of the business was enhanced.
a. The number of vehicles increased from two (2) to nine (9).
b. The contracts had increased to four (4) van runs with the Lakeland School
District and had escalated from $27,750.20 in 2005-2006 to $111,504.47 for
the 2008-09 school year.
c. Wansacz recommended that contracts be awarded for van runs with the
Carbondale Area School District valued at $71,913.60 for the 2008-09
school year. (See Findings #186, #187).
THE FOLLOWING FINDINGS RELATE TO WANSACZ’S ACTIONS AS THE DIRECTOR
OF TRANSPORTATION FOR THE LAKELAND SCHOOL DISTRICT.
18. The Lakeland School District is located in Lackawanna County and provides basic
educational services to approximately 1,700 students.
a. Revenue is received by the District from the Commonwealth in the form of
subsidy for pupil transportation expenses including nonpublic and charter
schools.
b. Student transportation is provided by district wide contracts and special
carriers.
c. The District’s total student population has remained approximately the same
since [the] 2003-04 school year.
19. Prior to Wansacz becoming Director of Transportation, the District’s special
education some [sic] students were transported by the Northeastern Educational
Intermediate Unit #19 (NEIU #19).
a. LSD [and] nineteen (19) other school districts comprise the NEIU #19.
b. The NEIU #19 provided transportation services for special education
students at the rate structure established by the Pennsylvania Department of
Education.
Wansacz, Jr., 08-033
Page 6
1. The District believed the rates charged by NEIU were higher than
utilizing private contractors.
20. Business records of the Lakeland School District include a job description for the
position of Transportation Director, which contains the following duties, [and] which
was approved by the Board during [its] November 15, 2006, meeting.
?
Demonstrate the ability to communicate both orally and in writing with all
components of the school community.
?
Possess at least a high school education or equivalent with essential
computer skills.
?
Exhibit the necessary aptitude or competence for the assigned
responsibilities.
?
Coordinate all Transportation stops within the school district with the proper
authorities.
?
Approve all student bus assignments and all changes.
?
Coordinate and oversee all independent bus contractors and van drivers.
?
Work with contractors to create and maintain bus/van routes for the most
efficient and economical operation of the transportation program.
?
Maintain up-to-date student rosters with rider names, stops, addresses and
pickup times.
?
Audit all bus/van route mileage.
?
Advise the Superintendent of road conditions during the periods of inclement
weather.
?
Act as the district liaison with all private and special education schools to
coordinate transportation schedules for students.
?
Develop recommendations for future transportation needs and
improvements.
?
Verify with all contractors that all drivers have all proper health, child abuse
and criminal background checks as required by law.
?
Maintain safety standards in conformance with state and insurance
regulations and develop a program of preventative safety.
?
Cooperate with school principals, athletic director, and others responsible for
planning special school trips.
?
Attend appropriate committee and staff meetings when requested.
?
Prepare transportation budget with the Business Manager.
?
Implement mandated bus/van driver drug/alcohol testing policy.
?
Complete all state/federal required transportation reports and dispatch
appropriate reports.
?
Monitor contractor compliance with state/federal regulations.
?
Be responsible for in-services (mandated and practical) training for all
transportation personnel; monitor mandated in-service programming for
transportation contracts.
?
Act as liaison between parents and the District in matters relating to student
transportation.
?
Be responsible for the record keeping and the submission of state
transportation reports in conjunction with the Business Manager.
?
Consults with governmental agencies to ensure compliance with State and
Federal procedures and mandates.
?
Prepare for the District contract specifications and documents, vendor
service agreements, rate adjustments and compliance with contract
specifications for pupil transportation services.
?
Assume any additional duties assigned by the superintendent.
21. One of Wansacz’s primary responsibilities as Transportation Director for the LSD
Wansacz, Jr., 08-033
Page 7
was to reduce transportation costs to the District associated with special education.
a. The District believed that this goal could best be achieved by utilizing private
contractors for individual transportation runs instead of NEIU #19 buses.
22. Transportation rates for special education vans/buses are annually established by
the Pennsylvania Department of Education (DOE).
a. DOE provides school districts with the formula to calculate the rates for an
individual run.
b. Rates are based on the number of students per run, at a predetermined rate,
per mile, per day, factoring in the age of the vehicle being used for the
services.
23. Some of Wansacz’s duties and responsibilities in regards to special education and
other special van/bus transportation needs include, but are not limited to:
a. Identifying specific bus/van routes.
b. Locate and recommend transportation contractors for the specified routes.
c. Monitor transportation contractors’ performance and handle any
issues/complaints.
d. Review and submit to the District for payment, calendars forwarded by
transportation contractors detailing dates and runs completed.
24. The Lakeland Board of School Directors approved bus and van routes based on
information provided to the Board by Transportation Director Wansacz.
a. The Lakeland School District does not seek competitive bids or proposals for
bus and van routes.
b. Since June 2005 the Board has relied on Wansacz’s recommendations
regarding awarding bus and van routes.
c. Wansacz, in conjunction with the Superintendent, is responsible for
determining transportation routes for the School District.
25. As the Director of Transportation, Wansacz oversees contractors for pupil
transportation for each school year.
a. Wansacz bases the number of buses and vans needed on the number of
children that require transportation daily.
b. Once Wansacz determines the number of children in need of transportation,
he determines bus/van routes needed and recommends which contractor will
be assigned to each route.
c. Bids, quotes or proposals for these routes were not sought.
26. Prior to Wansacz’s verification and recommendation to the Board of Directors that
payment to transportation contractors be made, the following process was
employed:
a. Bus routes are paid based on calendars prepared by each contractor which
Wansacz, Jr., 08-033
Page 8
contain the days traveled for each bus/van.
b. Wansacz signs the calendar, as the Director of Transportation, to
recommend that payment be made to each contractor.
c. Based on his signature the calendars are forwarded to the Business
Manager to process for payment.
d. An “X” is placed on each day of the month a particular bus/van is used.
e. These markings are the basis for generating the payment.
f. Absent Wansacz’s signature, the Board would not issue payment to the
contractor.
g. The number of days traveled is compiled by the District’s Business Office.
27. The Lakeland School District issues payments to transportation contractors as part
of the routine payment of bills.
a. These payments are generally included as part of a monthly bill list provided
to the School Board.
b. The bill lists are prepared in the District’s Business Office.
c. District bill lists are typically voted on in their entirety by a single motion.
d. Bill lists are provided to Board members as part of their meeting packets
approximately 4-5 days prior to their meeting.
e. Payments for transportation services are made on a monthly basis.
28. Since June 2005, the Lakeland School Board has approved bus and van contracts
and route rates annually based on the recommendations of John Wansacz in his
official capacity as the District’s Transportation Director.
a. These actions are typically approved by the School Board at the beginning
of each school year.
b. Contracts are approved based on an anticipated total cost.
c. Changes to contract rates are approved throughout the school year on an
as-needed basis.
d. Bids for these services are not solicited by Wansacz.
29. All bus and van contracts approved by the Board are done based on the actions of
Wansacz in his official capacity as Director of Transportation.
a. Wansacz provides the information, including his recommendations, on
District stationery to the Superintendent who forwards it to the Board for
approval.
b. No formal bidding occurs on these contracts.
c. Bus contractors are not awarded contracts without Wansacz’s
recommendation.
Wansacz, Jr., 08-033
Page 9
30. Since Wansacz became the LSD Director of Transportation, the Board has
consistently approved his recommendations without change.
a. The Board does not get involved with the day-to-day monitoring of
transportation contracts.
31. Since January 2006, Wansacz has used his position as Transportation Director to
recommend [that] bus contracts be awarded by the LSD to Nemeth/NEST.
32. Minutes of meetings of the Lakeland School District’s Board of School Directors
reflect action taken during school years 2005-06 through 2008-09 approving bus
and van contracts for each school year based on the recommendation of
Transportation Director John Wansacz.
33. Enclosures to meeting minutes when bus contracts were approved by the Board
confirm NEST being awarded the following contracts:
a. September 14, 2005: 2005-06 School Year
Enclosure #14 did not include any approval for Kimberly Nemeth, John
Wansacz, Jr. or Northeast Student Transportation, Inc.
b. September 20, 2006: 2006-07 School Year
Enclosure #25 Northeast Student Transportation, Inc.
232 $39,101.30
233 $21,487.07
234 $18,180.21
c. September 19, 2007: 2007-08 School Year
Enclosure #16 Northeast Student Transportation, Inc.
232 $37,192.25
233 $33,605.41
234 $34,100.79
242 $27,689.21
d. August 20, 2008: 2008-09 School Year
Enclosure #10 Northeast Student Transportation, Inc.
232 $36,785.66
233 $21,962.54
343 $30,203.50
344 $22,552.77
34. The Lakeland School District did not utilize the services of Kimberly Nemeth d/b/a
Northeast Student Transportation prior to Wansacz becoming Transportation
Director.
a. Nemeth’s name appears on LSD’s contracted bus driver list for the 2003-
2004 school year.
1. John Wansacz, Jr.’s name also appears on that list.
35. Kim Nemeth d/b/a Northeast Student Transportation, Inc. was not included on the
list of approved bus or van contractors for the 2005-06 school year, approved by
the Board on September 14, 2005.
a. Nemeth was awarded bus contracts by the Board, based on the
Wansacz, Jr., 08-033
Page 10
recommendation of Wansacz, for the 2005-2006 school year beginning in or
about February 2006.
b. Northeast Student Transportation was approved four (4) van runs for the
2006-07 school year on September 20, 2006. (Vans 232, 233, 234, 242)
c. Northeast Student Transportation was approved four (4) van runs for the
2007-2008 school year on September 19, 2007. (Vans 232, 233, 234, 242)
d. Northeast Student Transportation was approved for four (4) van runs for the
2008-09 school years on August 20, 2008. (Vans 232, 242, 343, 344)
36. On June 27, 2007, the LSD Board approved summer transportation contracts for
extended school year services, which included NEST, based on Wansacz’s
recommendations.
a. Wansacz recommended contractors John Schlasta, D-V Schlasta and
Northeast Student Transportation.
b. Three (3) of Northeast Student Transportation vans were included (Van 232,
233, 234).
c. The Board approved these extended contracts at Wansacz’s
recommendation.
d. These extended contracts were not bid by the district.
37. In or about January 2006, Wansacz recommended to the Board that Nemeth be
awarded contracts to provide bus services to the LSD for the remainder of the
2005-2006 school year.
a. Bid quotes were not solicited from other contractors.
38. At the time that Nemeth was awarded bus contracts she did not own any vehicles
suitable for transporting special needs students.
a. Nemeth owned a 2002 Mitsubishi Galant and a 2002 Mercedes ML 320
during the 2005-06 school year.
b. Nemeth utilized vehicles owned by Wansacz to complete the bus routes for
LSD.
39. Wansacz had a reasonable expectation at the time he recommended bus route
contracts be awarded to Nemeth, that he would receive a financial benefit as a
result.
a. Wansacz purchased the vehicles prior to the award of the contract.
40. Wansacz purchased a 1999 Plymouth Voyager and a 2001 Chevrolet Venture
which were used by Nemeth for district transportation runs during the 2005-06
school year.
a. Between December 13, 2005, and February 2, 2006, Wansacz purchased
these vehicles which were then used by Nemeth after Wansacz
recommended her to be a LSD bus contractor.
41. Title transfer documentation maintained by the Pennsylvania Department of
Wansacz, Jr., 08-033
Page 11
Transportation, Bureau of Motor Vehicles, confirms the following regarding
Wansacz’s purchase of vehicles used by Nemeth to perform services in relation to
the Lakeland School District bus contract awarded by Wansacz.
a. Wansacz purchased a 1999 Plymouth station wagon (Voyager) V.I.N.
2P4GP44R3XR324050 for the selling price of $2,915.00 from Cure Auto
Sales R-1771 Lakeland Drive, Jermyn, PA 18433 on December 13, 2005.
1. Wansacz purchased the van approximately one month prior to
recommending the awarding of the contract to Nemeth.
b. Wansacz purchased a 2001 Chevrolet Venture V.I.N.
1GNDX03EX1D108423 for a selling price of $5,208.00, less a trade of
$2,508.00, from Village Auto Sales, 1506 Heart Lake Road, Jermyn, PA
18433 on February 2, 2006.
1. This vehicle was purchased in or about the same time frame that
Nemeth begins to provide busing services to the LSD.
42. Wansacz applied for omnibus registration for the Chevy Venture through PennDOT.
a. An omnibus registration is issued by PennDOT for vehicles primarily owned
by individuals, churches, or other charitable organizations and are not
generally used as for-hire buses.
43. On February 17, 2006, PennDOT sent Wansacz correspondence informing him that
his application for omnibus registration for V.I.N. 1GNDX03EX1D108423 (2001
Chevrolet Venture) could not be processed until additional information was
provided.
44. In further support of his application, Wansacz in his official capacity as Director of
Transportation for the Lakeland School District, sent correspondence dated March
23, 2006, on District stationery responding to PennDOT’s February 17, 2006,
[correspondence], which required an explanation of how the omnibus will be used
and for what purpose.
a. In Wansacz’s letter he writes: “Please be advised that John Wansacz, Jr.
has a contract with Lakeland School District for the use of two vans for the
2005-2006 school year. Mr. Wansacz is responsible for the transportation of
students to and from school along with activity trips.”
b. This letter was signed by John Wansacz, Jr.
c. Kimberly Nemeth was not mentioned in this correspondence.
45. Wansacz responded to PennDOT’s request for additional information on or about
April 30, 2006.
a. Included with Wansacz’s application was the following explanation of how
the omnibus will be used: “To transport school students to and from school-
7-passenger van.”
46. The two (2) vans that Wansacz informed PennDOT had contracts with the Lakeland
School District for the 2005-2006 school years were the 1999 Plymouth Voyager
V.I.N. 2P4GP44R3XR324050 and 2001 Chevrolet Venture V.I.N.
1GNDX03EX1D108423 purchased on December 13, 2005, and February 2, 2006,
respectively.
Wansacz, Jr., 08-033
Page 12
a. Both of these vehicles were owned by Wansacz.
47. The Lakeland School District requires transportation providers to submit copies of
PennDOT registrations, proof of insurance, and a list of drivers intended to be used
on each bus/van run.
a. As Director of Transportation, Wansacz receives and maintains these
records for the District.
48. Vehicle registration and insurance information supplied to the District by Wansacz
for the contracts awarded to Nemeth was for the 1999 Plymouth and 2001
Chevrolet that Wansacz owned.
a. Van 230, the 1999 Plymouth, V.I.N. 2P4GP44R3XR324050 had licensing
valid from January 24, 2006, through November 30, 2006.
1. This vehicle was insured by Wansacz through National Indemnity
Company, NAIC #20087, policy number 70APN376132 effective
January 3, 2006.
b. Van 231, the 2001 Chevrolet, V.I.N. 1GNDX03EX1D10843 had licensing
valid May 5, 2006, through January 31, 2007.
1. Wansacz also had this vehicle insured through National Indemnity
Company, NAIC #20087, policy number 70APN376132.
49. No evidence exists to suggest that Wansacz sought or received approval from the
Lakeland School Board of Directors to authorize the two (2) vans he owned to
contract with the District for the 2005-2006 school year.
a. No bidding or quotes were sought by Wansacz prior to him authorizing the
use of his vans by the District.
b. Wansacz, in his official capacity as Director of Transportation, made the
decision to recommend that a contract be awarded to Nemeth/NEST who
would in turn be utilizing vans owned by him.
50. Wansacz recommended Kim Nemeth as a contractor for the remainder of the 2005-
06 school year.
a. Wansacz selected and recommended Nemeth to be the contractor of record
on two (2) bus runs for the 2005-06 school year.
b. Vehicles used for these runs were owned and insured by Wansacz.
c. Wansacz’s applications to PennDOT identify and verify that he was
contracting with the LSD.
d. Wansacz received a financial benefit as a result of payment being made
from LSD to Nemeth/NEST.
51. Kim Nemeth used two (2) vans owned by Wansacz for transportation services
provided to LSD for the 2005-06 school year as identified below.
Van # Year Make Model Tag Vin. Registered
Owner
Wansacz, Jr., 08-033
Page 13
230 1999 Plymouth Voyager GGF3469 2P4GP44R3XR324050 John Wansacz
231 2001 Chevrolet Venture OB61955 1GNDX03EX1D108423 John Wansacz
a. Both vehicles were insured by Wansacz through National Indemnity
Company under commercial automobile policy number 70APN376132.
52. Wansacz, in his official capacity as Director of Transportation for the Lakeland
School District, utilized a standard transportation contract for special transportation
runs.
a. The same basic form was used during school years 2005-2006 through
2008-2009.
b. The stated contract value is inserted for each school year.
c. The contract form includes signature lines for the Contractor,
Superintendent, Board Secretary and Board President.
53. None of the transportation contracts the District entered into with Kimberly Nemeth
individually or d/b/a Northeast Student Transportation, Inc. includ[ed] the signatures
of any District official.
a. These contracts should have been signed by the Superintendent, Board
Secretary, and Board President as detailed in the previous Finding.
54. Nemeth completed contractor rate forms for the vans used for the 2005-06 school
year.
a. Contract rates were for vehicles identified as 230 and 231.
b. Rates were calculated based on the DOE formula.
c. Wansacz determined the length of the run, number of students, and the
contractor utilized.
55. The contract for vehicle code 230 had an effective date of January 2, 2006.
a. The contractor name is listed as Kim Nemeth.
b. Vehicle code 230 is identified as a 1999 (no model listed) serial number
2P4GP44R3XR324050.
1. This is the 1999 Plymouth Voyager owned by Wansacz.
c. The reimbursable cost per day is $113.95.
d. The contract was not signed.
56. The contract for vehicle code 230 was modified effective February 16, 2006,
increasing the reimbursable cost per day from $113.95 to $123.28.
a. This increase was as a result of an increase in the approved number of daily
miles.
b. This change was approved by the Lakeland School Board during [its] March
15, 2006, meeting at the recommendation of Wansacz.
Wansacz, Jr., 08-033
Page 14
57. The contract for vehicle code 231 had an effective date of February 1, 2006.
a. The contractor name is listed as Kim Nemeth.
b. Vehicle code 231 is identified as a 2001 (no model listed) serial number
1GNDX03EX10108423.
1. This is the Chevrolet Venture owned by Wansacz.
c. The reimbursable cost per day of $139.41 recommended by Wansacz was
approved by the Board on February 15, 2006.
d. No signatures are contained on the contract.
58. No evidence exists to suggest that Wansacz ever disclosed to the Lakeland School
Board that both of these contracts were for services provided using vehicles that he
owned.
a. No evidence exists to suggest that Wansacz ever informed the Board that he
filed documents with PennDOT identifying him as the contractor.
b. No evidence exists to suggest that Wansacz ever disclosed to the Board that
he had a reasonable expectation that he would be receiving payments as a
result of these contracts.
59. Wansacz also served as a driver of one of the vans for which a contract was
awarded to provide bus services to the LSD.
60. Payments for vans 230 and 231 during the 2005-06 school years were made
consistent with the District’s payment of bills detailed in Finding #27.
a. Nemeth would complete a monthly calendar for each van (230 and 231)
listing the days operated and submit the calendars to Wansacz.
b. Payments were generated by multiplying the number of days by the specified
daily rate.
c. These totals were forwarded to the business office for inclusion on the next
monthly bill list.
d. For the 2005-06 school year this form has a box for the month followed by
the numbers one (1) through thirty-one (31), for each day of the month.
e. The contractor writes “yes” next to the number representing each day of the
month that students were transported.
61. The Lakeland School District issued checks to Kim Nemeth on a monthly basis in
payment of van runs 230 and 231 utilized for LSD between January and June 2006.
a. A single check was issued each month in payment of both van runs.
b. These payments were generated based on the monthly logs verified and
recommended for payment by Wansacz.
c. Absent Wansacz’s verification and recommendation, no payments would be
made.
Wansacz, Jr., 08-033
Page 15
62. Business records of the Lakeland School District indicate a total of $27,027.70
beingissued to Kim Nemeth during the 2005-06 school year for contracted services
under van runs 230 and 231.
63. In addition to monthly payments for van runs 230 and 231, during the 2005-06
school year Nemeth received two (2) payments totaling $722.50 for other
transportation services provided.
a. On April 19, 2006, District check number 19170 in the amount of $200.00
was issued to Kim Nemeth for a van rental for football coaches under
account code 10-3250-513.
b. On May 30, 2006, District check number 19381 in the amount of $522.50
was issued to Kim Nemeth under the description “contracted carrier” with the
same account code 10-3250-513 as the April 19, 2006, check.
c. Monthly contracted runs had a District account code of 10-2700-513.
64. During the 2005-06 school year the Lakeland School District issued eight (8)
checks totaling $27,750.20 to Kimberly Nemeth for transportation services.
a. This total includes monthly van runs 230 and 231 plus the two (2) additional
payments ($722.50) detailed in the previous finding.
b. These payments were made to Nemeth for services rendered utilizing
vehicles owned by the Respondent.
65. Of the $27,027.70 in checks issued to Nemeth by the LSD for the 2005-2006 school
year, $13,032.71 was deposited into Wansacz’s personal bank account.
a. The checks issued by the District were made payable to Kim Nemeth.
b. Nemeth signed the back side of each check followed by Wansacz’s
signature.
c. These checks were deposited into Wansacz’s personal bank account at Old
Forge Bank on May 2, 2006.
1. Wansacz has sole signature authority for this account.
66. Records of Wansacz’s account at Old Forge Bank confirm the deposit of the
following four (4) checks, totaling $13,032.71, which were issued by the Lakeland
School District to Kim Nemeth:
a.
Check # Date Amount Deposit Date
18737 02/16/06 $ 2,051.10 05/02/06
18934 03/16/06 $ 4,927.79 05/02/06
19093 04/12/06 $ 5,853.82 05/02/06
19170 04/19/06 $ 200.00 05/02/06
$13,032.71
b. These checks represented the first four payments issued by the LSD to
Nemeth for bus services.
67. Of the $27,750.20 (48.2%) paid by the Lakeland School District to Kim Nemeth for
transportation services provided during the 2005-06 school year, $13,032.71 was
Wansacz, Jr., 08-033
Page 16
deposited into Wansacz’s personal banking account.
a. All $27,750.20 paid to Nemeth was for the use of vehicles owned by
Wansacz.
b. The contracts/bus runs were recommended by Wansacz in his official
capacity as Director of Transportation for the Lakeland School District.
c. Wansacz and Nemeth were the only two (2) drivers on these runs.
d. Wansacz recommended Nemeth/NEST as the Lakeland School District
transportation provider with the reasonable expectation that he would
receive a financial benefit from Nemeth/NEST.
68. The issue of Wansacz’s involvement with contracting bus/vans with the Lakeland
School District was raised as part of [a] routine audit of LSD records conducted by
the Commonwealth of Pennsylvania, Department of Auditor General for the years
ending June 20, 2003, and June 20, 2004.
69. The Department of the Auditor General’s audit report of the Lakeland School
District, Lackawanna County, PA, of the years ending June 30, 2003, and 2004 and
in certain areas extending beyond June 30, 2004, contained findings and
recommendations through June 20, 2006, and was officially released around
February 2007.
a. The audit report is dated June 20, 2006.
b. This audit report included two (2) findings; one relating to an error in
reporting the number of nonpublic pupils transported resulting in a
reimbursement overpayment of $6,545.00 and a second finding regarding a
potential conflict of interest transaction.
1. The potential conflict of interest transaction related to Wansacz.
70. Contained in the audit report as audit finding #2, was the following synopsis,
recommendations and conclusions regarding a potential conflict of interest with the
District’s Director of Transportation (Wansacz).
a. The district’s current director of transportation (director) was hired in that
position as a part-time employee in 2005. Our audit found that this
individual owns two vans that were used by his girlfriend to transport district
pupils during the 2005-06 school years. In January 2006, the director’s
girlfriend was approved by the school board to operate as a transportation
contractor for the district. However, we found no evidence of a signed
contract between the district and the director’s girlfriend or the director. We
further learned that the director provides insurance for both vans and serves
as a driver of one of them. Checks from the school district for payment of
services were made payable to the girlfriend and endorsed by the girlfriend
and the director. Payments were in the amount of $15,500.00 for the period
January through June of 2006.
This transaction occurred because the board and the director did not view
this transaction as problematic.
A copy of the finding will be forwarded to the State Ethics Commission for
additional review.
Wansacz, Jr., 08-033
Page 17
Recommendations
The board should:
?
Seek the advice of its solicitor regarding the board’s
responsibility for district employees associated with contracts
that they administer;
?
Require district administration to strengthen controls over its
contract award process to help ensure detection of potential
conflicts of interest; and
?
Strengthen controls to help ensure compliance with state laws
regarding district employees who conduct business with the
school district.
Response of Management
Management disagreed with the finding and stated that they will respond at a
later date.
Auditor’s Conclusion
The Ethics Act states that no public employee or any business in which the
person is associated shall enter into any contract valued at $500.00 or more
with the governmental body with which the public employee is associated.
Also, the public employee shall not have any supervisory or overall
responsibility for the implementation or administration of the contract.
Therefore, the finding will stand as presented.
71. During the audit period of May/June 2006, Auditor General auditors observed
Wansacz arriving for work at the LSD in a Northeast Student Transportation van.
a. Wansacz admitted to the auditors that he was one of the drivers along with
Nemeth.
b. Wansacz informed the auditors that, “they (the Board) told him it was ok for
him to drive the van.”
c. No evidence exists to suggest that such [sic] the Board or any official of the
LSD gave approval to Wansacz.
72. The preliminary audit findings were discussed during a Board Executive Session on
or about June 24, 2006.
a. Superintendent Margaret Billings-Jones provided the Board with a “June
Board Brief” dated June 24, 2006.
b. Contained was the following information on transportation:
“Transportation summer contracts are being drafted to provide extended
school year transportation to special needs students. Audit finding of
possible conflict of interest transaction was noted and will be responded to at
a later date. Overpayment and underpayment of invoices was also found for
2002-2003 and 2003-2004.”
c. The Board determined that Wansacz had to divest himself of any financial
interest in the business and all vehicles had to be placed in his girlfriend’s
name.
Wansacz, Jr., 08-033
Page 18
d. The District did not provide any follow up response to the audit.
73. Following the issuance of the Auditor’s Report, for the 2006-07 school years,
Nemeth began doing business with the Lakeland School District under the business
name Northeast Student Transportation, Inc., (NEST), 997 N. Main Street,
Archbald, PA 18403.
b. Northeast Student Transportation, Inc. was incorporated by Nemeth on
August 18, 2006.
c. Wansacz stopped serving as a driver for the LSD through Northeast Student
Transportation.
74. Wansacz, in his official capacity as Director of Transportation for the Lakeland
School District, recommended the increase of the number of van runs conducted by
Nemeth/NEST for LSD to four (4) for the 2006-07 school year.
a. Although four (4) runs were approved for the 2006-07 school year, only three
(3) were provided.
c. Drivers on file with the District for the 2006-07 school year for NEST were
Kim Nemeth, Frank Wrona and Jerry Kaminski.
75. Northeast Student Transportation was approved by [the] LSD Board of Directors for
four (4) bus/van runs for the 2006-07 school years on September 20, 2006.
a. The contracts were approved by the Board based on Wansacz’s
recommendation.
b. These contracts were not sought pursuant [to] any competitive bidding.
c. Wansacz assigned van numbers 232, 233, 234, and 242 to Northeast
Student Transportation runs for the 2006-07 school year.
d. Nemeth operated van numbers 230 and 231 during the 2005-06 school year.
e. Van numbers 230 and 231 were not used by Wansacz during the 2006-07
school year.
76. Nemeth’s contract d/b/a Northeast Student Transportation with the Lakeland School
District provided for payments totaling $88,773.00 for (4) bus runs for the 2006-07
school year.
a. Although the LSD Board approved the contracts on September 20, 2006, no
contract was executed by Nemeth until June 27, 2007.
b. This contract was not signed by any District officials.
77. To be able to fulfill the additional van runs Nemeth d/b/a Northeast Student
Transportation, Inc. purchased additional vehicles.
a. Vehicle records maintained by LSD for the 2006-07 school years listed the
following vehicles for van runs 232, 233, 234, and 242.
b. 232 – 2002 Ford V.I.N. 2FMZA52462BB09416
233 – 2002 Kia V.I.N. KNDUP131326340539
Wansacz, Jr., 08-033
Page 19
234 – 1999 Plymouth V.I.N. 2P4GP44R3XR324050
242 – No vehicle assigned.
c. Nemeth individually and/or d/b/a Northeast Student Transportation, Inc. did
not own any vehicles used for transportation runs prior to the 2006-07 school
year.
78. From the beginning of the 2006-07 school year (August 2006) through November
28, 2006, Wansacz was the owner of the 1999 Plymouth Voyager V.I.N.
2P4GP44R3XR324050.
a. Wansacz continued to own the vehicle used for a District van run after the
Auditor’s Report of June 20, 2006.
b. Wansacz continued to carry insurance on this vehicle until September 26,
2006.
79. The 1999 Plymouth Van V.I.N. 2P4GP44R3XR324050 used as van 234 for the
2006-07 school year was the same vehicle designated as van 230 for the 2005-06
school year.
a. This vehicle was owned by Wansacz from approximately December 13,
2005, until November 28, 2006, when ownership was transferred to Nemeth.
b. On November 28, 2006, Nemeth d/b/a Northeast Student Transportation,
Inc. purchased this vehicle from Cars Are Us.
80. On November 28, 2006, Wansacz sold the 1999 Plymouth Voyager V.I.N.
2P4GP44R3XR324050 to Cars Are Us, 701 S. State Street, Clarks Summit, PA
18411 for $1,200.00.
a. Jerry Soroka signed the title as purchaser with his signature notarized by
Donald J. Hopkins, Jr.
b. The odometer reading at the time of sale was 151,452.
c. A re-assignment of title by registered dealer was also notarized November
28, 2006.
d. The seller is identified as Jerry Soroka with a purchaser of Kim Nemeth,
President, Northeast Student Transportation with a purchase price of
$1,200.00.
e. The odometer reading at the time Nemeth purchased the vehicle was listed
as 151,485.
f. The front side of the certificate of title, box D application for title and lien
information is signed by Nemeth and notarized by Lisa Scheller, Notary on
November 30, 2006.
g. Vehicle transfer/temporary registration documents indicate that Northeast
Student Transportation, Inc. purchased this vehicle from Cars Are Us for
$1,200.00 on November 28, 2006.
81. Evidence exists that Jerry Soroka d/b/a Cars Are Us never physically took
possession of the 1999 Plymouth Voyager van.
Wansacz, Jr., 08-033
Page 20
a. Evidence exists Soroka processed this transaction through Cars Are Us at
Wansacz’s request.
82. Cars Are Us issued business check number 14978 in the amount of $1,200.00 to
John Wansacz, Jr. dated November 27, 2006.
a. This check is dated one day prior to Wansacz signing the title over to Cars
Are Us.
b. The memo portion of this check lists, “vehicle purchase 99 Voyager Van.”
c. Wansacz, Jr. had not previously sold a vehicle outright to Soroka/Cars Are
Us.
d. Wansacz, Jr. was not a licensed automobile dealer at the time.
e. Wansacz deposited this check into his account at Honesdale National Bank,
account no. 4245929903 on March 23, 2007, almost four (4) months after
the transaction.
83. On November 28, 2006, Nemeth issued Northeast Student Transportation check
#134 from Honesdale National Bank in the amount of $1,200.00 to Cars Are Us.
a. This check was in payment of the 1999 Plymouth Voyager Van VIN
#2PGP44R3XR324050.
b. This payment cleared the account on November 30, 2006.
c. Nemeth had the title processed by Northeast Title and Tag, a title/tag service
on November 30, 2006.
84. Although this transaction on paper occurred between November 28, 2006, and
November 30, 2006, this vehicle remained in service and used for bus vans for the
LSD.
a. Daily transit records for Van 234 reflect it continued to be used to transport
district students between November 28, 2006, and December 1, 2006,
during the same days it was sold to Cars Are Us by Wansacz and then
Northeast Transportation, Inc.
b. Daily driver reports signed by Wansacz in his official capacity as Director of
Transportation include the letter X on calendar days November 28, 29, 30
and December 1, 2006, reflecting this vehicle was in service each of these
days.
85. The 2001 Chevrolet Van VIN #1GNDX03EX1D108423 used as van number 231 for
the 2005-06 school year was not used in the District by Nemeth for the 2006-07
school year.
a. This vehicle was used by Wansacz for a transportation run he had in the Old
Forge School District during the 2006-07 school year. (See Finding #154).
86. Effective August 29, 2006, Nemeth obtained a commercial vehicle insurance policy
in the name of Northeast Student Transportation from Erie Insurance, policy number
70APN414778. Policy records included a list of authorized drivers and covered
vehicles.
Wansacz, Jr., 08-033
Page 21
a. Authorized drivers were identified as Kimberly Ann Nemeth and John
Wansacz, Jr.
b. Covered vehicles included the 1999 Plymouth Voyager VIN#
2P4GP44R3XR324050, and 2001 Chevrolet Venture VIN#
1GNDX03EX1D108423 owned by Wansacz, and a 2002 Ford Windstar
VIN# 2FMZA52462BB09416.
c. The 1999 Plymouth Voyager and 2001 Chevrolet Venture were both owned
by Respondent Wansacz at the time this policy was opened.
87. Wansacz was using the 2001 Chevrolet Venture for a van run for the Old Forge
School District while the 1999 Plymouth Voyager was being used for a run in the
Lakeland School District.
a. Nemeth cancelled this policy effective September 30, 2006.
b. Wansacz then insured the 2001 Chevrolet Venture through Erie Insurance
policy #Q102730431 effective October 27, 2006.
c. This vehicle was insured under Northeast Student Transportation, Erie
Insurance policy #Q092630483 from September 26, 2006, through
September 28, 2006.
88. Northeast Student Transportation vehicle insurance records for Erie Insurance
policy #Q092630483 reflect the following vehicles were insured as of September
28, 2006.
a. 1999 Plymouth Voyager VIN# 2P4GP44R3XR324050
2002 Kia Van VIN# KNDUP131326340539
2002 Ford Van VIN# 2FMZA52462BB09416
2000 Hired Auto no VIN# listed
2000 Non-Owned Auto no VIN# listed
89. Vehicles used by Northeast Student Transportation, Inc. for van runs 232 and 233
for the 2006-07 school years were purchased by Nemeth d/b/a Northeast Student
Transportation during August and September 2006.
90. On August 29, 2006, Nemeth d/b/a Northeast Student Transportation, purchased a
2002 Ford V.I.N. 2FMZA52462BB09416 from Village Auto Sales, 1506 Heart Lake
Road, Jermyn, PA.
a. This vehicle was used as van 232 for the 2006-07 school years.
91. On September 28, 2006, Nemeth d/b/a Northeast Student Transportation
purchased a 2002 Kia Sedona V.I.N. KNDUP131326340539 from Cars Are Us.
a. This vehicle was used as van 233 for the 2006-07 school years.
92. Although route 242 was approved for the 2006-07 school year for Northeast
Student Transportation, Inc., no vehicle or driver was assigned to this route.
93. Payments issued to Northeast Student Transportation for vehicle runs during the
2006-07 school year were made on a monthly basis as a result of monthly driver’s
reports submitted by Nemeth and verified by Wansacz in his official capacity as the
District’s Director of Transportation.
Wansacz, Jr., 08-033
Page 22
a. The District issued one (1) check per month in payment of all three (3) runs.
94. A total of $89,248.08 in payments [was] issued by the LSD to Northeast Student
Transportation for the 2006/2007 school year.
95. In addition to payments for van runs 232, 233, and 234 during the 2006-07 school
year, Northeast Student Transportation received two (2) additional payments
totaling $655.00 for van rentals/field trips.
96. Northeast Student Transportation received eleven (11) payments totaling
$89,903.08 for services provided during the 2006-07 school year.
a. These payments were made as a result of contracts awarded to Northeast
Student Transportation, Inc., as recommended by Wansacz.
97. Nemeth d/b/a Northeast Student Transportation received payments totaling
$13,685.49 for the use of the 1999 Plymouth Voyager Van between August 2006
and November 28, 2006, when the van was actually owned by Wansacz.
a. These payments were recommended to be made by Wansacz.
98. In or around February of 2007, midway through the 2006-2007 school year,
Wansacz provided an undated letter to the Lakeland School Board regarding his
intent to cohabitate with the owner of Northeast Student Transportation.
a. Wansacz’s letter to the Board was in response to the Department of Auditor
General’s findings.
b. Wansacz informed the Board that this business (NEST) has a transportation
contract with the District.
c. Wansacz informed the Board that he was in no way related to the owner of
Northeast Student Transportation.
1. Wansacz did not identify the owner of NEST.
d. The specific content of Wansacz’s letter was as follows:
“The purpose of this letter is to inform you that I am in receipt of the letter of
findings from the State Auditors. I am able to inform you that prior to my
receipt of this letter I have divested myself of any and all interest in any of
the route vans that are utilized within in [sic] the district and paid for district
funds [sic]. I have addressed any and all concerns of the state in that none
of the practices identified by the state currently exist.
I would also like to take this opportunity to put the Board on notice that I
intend to cohabitate with the owner of Northeast Transportation Service, Inc.
You may or may not be aware that the aforementioned company currently
has a transportation contract with the district. I have consulted with my own
council (sic) prior to deciding to make this move and my attorney informed
me that the pending living arrangement would not be contrary to the findings
of the state auditor.
In closing I would like to state that I will abide by the interpretation of the
relevant facts and law by the districts [sic] solicitor in their determination as
to the impact of my pending living situation in connection with the findings
listed in the audit. I would also like to add that I am in no way related to the
Wansacz, Jr., 08-033
Page 23
owner of Northeast Transportation Services.”
99. Wansacz’s letter to the School Board did not disclose the following:
a. The identity of the owner of NEST;
b. The exact date Wansacz began to cohabitate with Kimberly Nemeth;
c. The physical location of their common residence;
d. Living expenses shared by the couple and the source of payment of those
expenses;
[e]. That Wansacz and Nemeth were the only two drivers on bus runs for the
2005-2006 school year.
100. On April 3, 2007, Lakeland School District Solicitor Patricia Grande Rieder,
provided the District a Solicitor’s Opinion regarding John Wansacz, the District’s
Transportation Director.
a. Solicitor Rieder’s April 3, 2007, letter was submitted to the District
Superintendent, Margaret Billings-Jones.
b. Solicitor Rieder’s Opinion was in specific response to Wansacz’s February
2007 Board notification of his intent to cohabitate with the owner of
Northeast Student Transportation Services, Inc.
101. Solicitor Rieder was of the opinion that no conflict of interest would exist merely as
a result of the cohabitation.
a. Based on Solicitor Rieder’s review of the State Ethics Law, she determined
that the stated definition of immediate family did not include a
boyfriend/girlfriend relationship.
b. Solicitor Rieder’s opinion was furthered by Wansacz’s representation “that
he has no ownership interest in the corporation and receives no financial
benefit from the corporation.”
1. Rieder conducted no independent inquiry and had no concrete
evidence that Wansacz was not receiving any financial benefit from
the corporation.
c. Solicitor Rieder advised “the District that they should request documentation
from Mr. Wansacz establishing the independence of the corporation…(and)
that should Mr. Wansacz change the status of his relationship with the owner
of Northeast Transportation Services, Inc. to a spousal relationship, there
would clearly be a conflict of interest.”
102. No record exists to establish that LSD ever requested documentation from, or that
Wansacz ever provided to, the LSD verification that he was not affiliated with NEST
or receiving any benefits from NEST funds.
103. Wansacz, in his official capacity as Director of Transportation for the Lakeland
School District, continued to recommend that contracts be awarded to NEST for the
2007-08 school year.
a. These contracts were approved by the Board, as presented by Wansacz, on
Wansacz, Jr., 08-033
Page 24
September 19, 2007.
b. Northeast Student Transportation, Inc. had four (4) approved van runs for
the 2007-08 school year: Van 232, 233, 234 and 242.
c. The Board’s actions [increased] the number of van runs Northeast Student
Transportation, Inc. had with the LSD by 25%.
1. Payments to NEST were set to increase by approximately
$45,000.00.
d. These contracts were not put out for any competitive bidding.
e. Wansacz assigned the van numbers and designated the routes for various
vehicles utilized by NEST.
104. Nemeth’s contract d/b/a Northeast Student Transportation with the Lakeland School
District totaled $132,587.66 for the 2007-08 school year.
a. Nemeth signed this contract on February 7, 2008, approximately 4 ½ months
after the contract was approved by the LSD.
b. This contract was not signed by any District officials.
105. Northeast Student Transportation used the following vehicles for Vans 232, 233,
234, 242 during the 2007-08 school year.
a. 1999 Plymouth Voyager VIN #2P4GP44R3XR324050
2002 Kia VIN #KNDUP131326340539
2002 Ford VIN #2FMZA52482BA36436
2002 Ford VIN #2FMZA52462BB09416
b. Wansacz did not require Nemeth to identify which vehicle was assigned to a
specific run.
106. Northeast Student Transportation submitted to the LSD the following list of drivers
for the 2007-08 school year.
a. Kim Nemeth
Frank Wrona
Jerry Kaminski
Tom Cerra
Carmine Cerra
b. Wansacz did not require Nemeth to identify which vehicle and route a
specific driver was assigned to.
107. Payments issued to Northeast Student Transportation for vehicle runs during the
2007-2008 school year were made on a monthly basis as a result of driver’s reports
verified by Wansacz in his official capacity as the District’s Director of
Transportation.
a. The District issued one (1) check per month in payment of all four (4) runs.
b. Extra runs, such as field trips, were included as part of payments.
108. Lakeland School District issued a total of $137,375.25 to Northeast Student
Wansacz, Jr., 08-033
Page 25
Transportation for the 2007/2008 school year.
109. In [addition] to payments for van runs 232, 233, 234, [and] 242 during the 2007-08
school year, Northeast Student Transportation received five (5) additional payments
for van rentals/field trips totaling 19,482.40.
110. Kimberly Nemeth d/b/a Northeast Student Transportation, Inc. received fourteen
*
(14) payments totaling $139,780.25 for services provided during the 2007-08
school year.
*
a. Payments total[ed] $137,375.25 for monthly runs and three (3) field trips
detailed in finding #129 [sic] plus $2,405.00 for seven (7) additional field
trips detailed in finding #130 [sic].
b. These payments were made as a result of no bid contracts recommended by
Wansacz and approved by the Board to Northeast Student Transportation
Inc.
c. Payments were deposited to a NEST checking account established by
Nemeth at Honesdale National Bank.
*
[Cf., Fact Finding 111 d.]
111. Kimberly Nemeth individually and/or d/b/a Northeast Student Transportation, Inc.
received payments totaling $257,433.70 for transportation services provided [to] the
Lakeland School District, during the 2005-06, 2006-07 and 2007-08 school years.
a. $27,750.20 was paid to Nemeth individually during the 2005-06 school year.
(See Finding #64)
1. $13,032.71 of that amount was deposited to a personal bank account
of John Wansacz, Jr. (See Findings #65, #66)
b. Nemeth d/b/a Northeast Student Transportation, Inc. received payments
totaling $13,685.49 for the use of the 1999 Voyager Van owned by Wansacz
between August 2006 and November 28, 2006. (See Finding #97)
c. $89,903.08 was paid to Nemeth d/b/a Northeast Student Transportation, Inc.
during the 2006-07 school year. (See Finding #[96])
*
d. A total of $137,780.25 was paid to Nemeth d/b/a Northeast Student
Transportation, Inc. during the 2007-08 school year. (See Finding #110)
*
[Cf., Fact Findings 110-110 a. Respondent receives the benefit of the lower
stipulated amount. Bartholomew v. State Ethics Commission, 795 A.2d 1073
(Pa. Commw. Ct. 2002).]
112. Northeast Student Transportation, Inc. provided services to the LSD for the 2008-09
school year.
a. These contracts were approved by the Board, as presented by Wansacz, on
August 20, 2008.
b. Northeast Student Transportation, Inc. had four (4) approved van runs for
the 2008-09 school year: Van 232, 242, 343, and 344.
c. These contracts were not put out for any competitive bidding.
Wansacz, Jr., 08-033
Page 26
d. Wansacz assigned the van numbers and designated the routes.
113. Based on the State formula, Wansacz established the following contract rates for
Northeast Student Transportation totaling $111,504.47 for the 2008-09 school year.
a. Van 232 - $204.36 per day / $36,785.66 for school year.
b. Van 242 - $122.01 per day / $21,962.54 for school year.
c. Van 343 - $167.79 per day / $30,203.50 for school year.
d. Van 344 - $125.29 per day / $22,552.77 for school year.
f. These contract rates were based on the daily rate multiplied by 180 days.
114. The preliminary contractor rate of $111,504.77 approved for Northeast Student
Transportation, Inc. for the 2008-09 school year was never signed by Kim Nemeth
on behalf of NEST.
a. The contracts were awarded while Nemeth still owned all of the NEST stock.
b. No district officials signed the contract awarded to NEST.
115. Northeast Student Transportation, Inc. identified the following drivers and vehicles
assigned to van runs for the 2008-09 school year.
a. Named drivers included Kimberly Nemeth, Frank Wrona, Jerry Kaminski,
Tom Cerra, and Carmine Cerra.
b. Stated vehicles included:
2002 Chevrolet VIN #1GNDU03E92D146283
2002 Ford VIN #2FMZA52472BA13536
2002 Ford VIN #2FMZA52462BB09416
2002 Kia VIN #KNDUP131326340539
c. Contract rate formula documents for the 2008-09 school year only included
the vehicle year without any make, model or serial numbers.
116. Nemeth d/b/a Northeast Student Transportation, Inc. insured all four (4) vehicles
listed in the previous finding as part of Erie Insurance Commercial Automobile
policy #Q092630483.
a. This policy was cancelled effective September 26, 2008.
117. Insurance records on file with the Lakeland School District reflect the vehicles listed
in Finding #134 [sic] were insured by Erie Insurance as part of policy number
Q092640022H.
a. The effective date of this policy was March 26, 2009, through September 26,
2009.
b. Insurance cards had hand written notations as to which van they pertained
to.
c. Vans 233 and 343 and 234 and 344 were referred to as the same vehicles
(See Finding #113).
Wansacz, Jr., 08-033
Page 27
118. On or about August 11, 2008, Kimberly Nemeth began the transfer of ownership of
Northeast Student Transportation, Inc. to Vladimir Schlasta and David Schlasta.
a. This process was not completed until a $55,000.00 payment dated
December 24, 2008, from the Schlastas was deposited into Nemeth’s
personal account at NET Federal Credit Union on February 10, 2009.
119. On August 11, 2008, at special meetings of the NEST Board of Directors and
Shareholders, Kimberly Nemeth resigned as both an officer and board member of
the corporation.
a. At the time Nemeth was the sole shareholder and held all of the officer
positions.
b. David and Vladimir Schlasta were named as officers and board members of
NEST at the same meetings.
120. At a third special meeting on August 11, 2008, David Schlasta was named
President of the Corporation and Vladimir Schlasta was named Secretary.
a. A motion was approved permitting Nemeth to continue to sign corporate
checks of NEST until her name is removed from the signature card,
accepting her resignation as a corporate officer and accepting the
nominations of David Schlasta as President and Vladimir Schlasta as
Secretary.
121. On August 20, 2008, the Board approv[ed] a bus contract for NEST for the 2008-
2009 school year.
122. On October 14, 2008, Nemeth transferred 500 shares of NEST stock [each to]
Vladimir Schlasta and David Schlasta to transfer ownership of NEST to the
Schlastas.
a. Stock transfer ledger for NEST lists the value of each stock transfer at
$27,500.00.
1. Total value of all corporate stock was $55,000.00.
b. Payment for the stock was not made by the Schlastas at that time.
123. Vladimir Schlasta and David Schlasta opened a business account for Northeast
Student Transportation, Inc. at Community Bank, NA account number
[XXXXXX]3441 with an initial deposit of $25,371.44 on October 15, 2008.
a. This account was opened one day after Nemeth transferred 1,000 shares of
NEST stock valued at $55,000.00; 500 shares each to Vladimir Schlasta and
David Schlasta (Finding #122).
124. Records on file with the Pennsylvania Department of State Corporation Bureau
reflect ownership of Northeast Student Transportation, Inc. was transferred to David
Schlasta and Vladimir Schlasta effective November 3, 2008.
a. The entity number remained 3669040.
b. The registered office address was changed to 1821 Lakeland Drive, Jermyn,
PA 18433.
Wansacz, Jr., 08-033
Page 28
c. David Schlasta is the stated President.
d. Vladimir Schlasta is the stated Secretary.
e. David Schlasta and Vladimir Schlasta are brothers.
125. The ownership change for Northeast Student Transportation, Inc. from Kimberly
Nemeth to David Schlasta and Vladimir Schlasta was recorded with the
Pennsylvania Department of State effective November 3, 2008.
a. This change was recorded almost two (2) months prior to the date of the
$55,000.00 payment to Nemeth. (See Finding #128).
126. At the time of the stock transfer, the Schlastas’ banking accounts did contain a
balance in excess of the $55,000.00 needed to pay Nemeth.
127. On November 3, 2008, when the change in ownership of Northeast Student
Transportation from Kimberly Nemeth to Vladimir Schlasta and David Schlasta was
recorded with the Pennsylvania Department of State, Corporation Bureau, the
Schlastas’ business account for NEST (Community Bank account #xxxxxxx4410)
did not have sufficient funds to pay for the stock transfer.
a. A minimum balance in excess of $55,000.00 would have been required to
complete the transaction.
b. Account #xxxxxxx4410 had a balance of $23,351.24 on November 3, 2008.
128. On or about December 24, 2008, Vladimir Schlasta, in his capacity as NEST
Corporate Secretary, issued NEST check number 1060 in the amount of $55,000.00
to Kimberly Nemeth.
a. The memo portion of the check indicates “purchase of N.E. Student Trans.”
b. The check was issued from a NEST account at First Liberty Bank opened by
[the] Schlastas on October 15, 2008.
c. The check was cashed and deposited to Nemeth’s personal bank account at
NET Federal Credit Union on February 10, 2009.
1. The check cleared the Schlastas’ account on February 12, 2009.
129. Between November 3, 2008, and December 24, 2008, Wansacz, in his official
capacities as Director of Transportation for the Lakeland and Carbondale Area
School District recommended the payment of monthly van runs to NEST.
a. Payments to NEST from LSD provid[ed] the Schlastas with enough capital to
issue Nemeth a check in the amount of $55,000.00 to purchase the business
on December 24, 2008.
130. Between November 3, 2008, and December 24, 2008, Northeast Student
Transportation, Inc. received eight (8) payments totaling $47,790.55 from the
Lakeland and Carbondale School Districts.
131. Wansacz, in his official capacity as Director of Transportation for the Lakeland and
Transportation Coordinator for the Carbondale Area School Districts, continued to
recommend that transportation payments be made to Northeast Student
Wansacz, Jr., 08-033
Page 29
Transportation, Inc. between December 24, 2008, and February 12, 2009.
a. During this timeframe an additional six (6) payments totaling $22,617.03
were made.
132. Between November 3, 2008, and February 12, 2009, John Wansacz, Jr., in his
official capacity as Director of Transportation for the Lakeland and Transportation
Coordinator for the Carbondale Area School Districts, recommend that fourteen (14)
payments totaling $70,707.58 be issued to Northeast Student Transportation, Inc.
133. Vladimir Schlasta and David Schlasta signed a contractor agreement on behalf of
Northeast Student Transportation, Inc. dated June 4, 2009, for the 2008-2009
school year.
a. The stated contract amount was $111,504.47.
b. This contract was dated at the end of the 2008-09 school year.
c. No District officials signed this contract.
d. No executed contract was on file at the beginning of the 2008-09 school
year.
134. Northeast Student Transportation, Inc. continued to provide transportation services
under Wansacz’s general supervision to both the Lakeland and Carbondale Area
School Districts during the ownership transition period.
135. Northeast Student Transportation, Inc. continued to get paid on a monthly basis for
student transportation runs in the Lakeland School District during the 2008-09
school year.
a. These payments were based on Wansacz’s approval of monthly run logs
submitted to the District.
136. Northeast Student Transportation, Inc. received eight (8) payments totaling
$66,112.84 from the Lakeland School District during the 2008-09 school year
through February 12, 2009.
a. [The] total includes 2008 summer runs and two (2) [field] trip payments.
137. Nemeth continued to be employed as a driver by the Schlastas d/b/a/ NEST after
the Schlastas were named President and Secretary of NEST.
a. Nemeth was paid $65.00/day from September 2008 through December
2008.
1. The rate was increased to $70.00/day effective January 1, 2009.
b. Payroll records confirm payments to Nemeth after the transfer of ownership
as follows:
Year Gross Pay Net Pay
2008 $20,695.09 $16,144.32
2009 $6,440.00 $5,549.66
(thru 5/31/09)
138. Nemeth closed the NEST account at Honesdale National Bank on October 15,
Wansacz, Jr., 08-033
Page 30
2008, one day after transferring stock to the Schlastas.
a. On October 15, 2008, Honesdale National Bank issued cashier’s check no.
312530 in the amount of $52,141.26 to Kimberly Nemeth which represented
the balance in NEST account no. 428446XXXX.
b. Nemeth deposited the $52,141.26 to her personal account at NET Federal
Credit Union on October 22, 2008.
139. Within seven (7) days of depositing the NEST closeout funds to her personal
account at NET, Nemeth made a payment to Wansacz.
140. Of the $52,141.26 of NEST funds deposited to Nemeth’s NET account, $27,600.00
in checks [was] issued to John Wansacz between November 6, 2008, and
November 13, 2008.
a. Only $1,997.75 in other funds [was] deposited to Nemeth’s account during
the October 26, 2008, to November 14, 2008, timeframe.
141. Payments to Wansacz from Nemeth were made as follows:
Date Check No. Amount Payee
11/06/08 2151 $13,000.00 John Wansacz
11/10/08 2159 $ 3,500.00 John Wansacz
11/13/08 NET certified check
no. 108554 $11,100.00 John Wansacz
Total $27,600.00
142. Check numbers 2151 and 2159 included account no. 8532-XXXX in the memo
portion of the check.
a. Wansacz maintains an account with the investment firm Janney Montgomery
Scott to account number 8532-XXXX.
b. Wansacz is the sole owner of this account.
143. Wansacz’s account summary 8532-XXXX with Janney Montgomery Scott confirms
that $27,600.00 from Nemeth was deposited to the account as follows:
Date Trans. Type Description Amount
11/06/08 Deposit Funds received
NET/Kim Nemeth $13,000.00
11/11/08 Deposit Funds received
Kim Nemeth/J. Wansacz $ 3,500.00
11/13/08 Deposit Funds received
NET Fed CU/J. Wansacz $11,100.00
$27,600.00
144. Wansacz purchased an ATV (all terrain vehicle) on or about October 29, 2008,
using money provided to him by Nemeth.
a. The purchase was made from North American Warhorse, Dunmore, PA,
seven days after NEST funds were deposited to Nemeth’s personal account.
b. Check no. 2142 from Nemeth’s NET account was issued to NA Warhorse in
the amount of $8,396.43.
Wansacz, Jr., 08-033
Page 31
c. North American Warhorse retail sales order for a 2009 Can-Am lists the
purchaser as John Wansacz.
1. The sales order is signed by John Wansacz, Jr.
2. Total sale price including accessories and taxes was $8,396.43.
d. Certificate of Title application form for the ATV submitted to the PA
Department of Conservation and Natural Resources ATV/Snowmobile
registration is signed by Wansacz.
1. Purchaser is listed as John Wansacz.
145. Nemeth received $55,000.00 payment dated December 24, 2008, from the
Schlastas.
a. The check was not deposited to Nemeth’s personal account at NET until
February 10, 2009.
146. Nemeth issued payments from her personal account at NET totaling $37,386.47 for
renovations to Wansacz’s home at [Redacted Residence Address], utilizing funds
from the NEST account and funds received from the Schlastas for the sale of NEST.
a. $27,386.47 of these payments [was] issued after the deposit of the
Schlastas’ $55,000.00 payment to Nemeth’s account on February 10, 2009.
b. Check numbers: 2207, 2208, and 2302 were made out in handwriting other
than Nemeth’s and appears to match Wansacz’s handwriting.
147. Nemeth also issued a payment to Wansacz on May 4, 2009.
a. Check no. 2310 was issued from Nemeth’s NET account in the amount of
$500.00 payable to John Wansacz.
148. In or about March 2006, Wansacz and Nemeth attempted to purchase a property
through O’Boyle Real Estate identified as 345 Stone Road.
a. This occurred approximately two months after Wansacz first awarded
contracts to Nemeth.
b. Both Nemeth and Wansacz issued checks as a deposit for the property.
1. Wansacz issued a $1,000.00 check no. 151 from his personal
account at Old Forge Bank on March 19, 2006, payable to O’Boyle
Real Estate, 400 S. State Street, Clarks Summitt.
2. Nemeth issued a $2,000.00 check payable to O’Boyle Real Estate
from her NET account on March 18, 2006, in the amount of
$2,000.00.
c. On December 16, 2006, O’Boyle Real Estate issued check no. 1189 from its
escrow account payable to John Wansacz or Kim Nemeth in the amount of
$3,000.00.
1. The memo portion of the check reflects “Deposit return 345 Stone
Road.”
Wansacz, Jr., 08-033
Page 32
d. O’Boyle Real Estate check no. 1189 in the amount of $3,000.00 was
deposited to Wansacz’s personal account at Honesdale National account
no. 424592XXXX on March 30, 2007.
e. No documentation exists that Wansacz returned any of the funds to Nemeth.
149. In or about July 2006 Wansacz assisted Nemeth with the purchase of a 2002
Mercedes Benz ML 3 from Cars Are Us.
a. The vehicle (VIN #4JGAB54E42A297154) had a purchase price of
$18,200.00.
1. Including state sales tax of 6%, the purchase price totaled
$19,292.00.
2. On July 1, 2006, Wansacz issued check no. 211 from his Old Forge
Bank account to Cars Are Us in the amount of $7,336.00.
3. Nemeth issued check no. 1375 from her NET account in the amount
of $12,000.00 to Cars Are Us for the balance of the vehicle.
b. On November 21, 2006, Nemeth applied for a loan in the amount of
$15,000.00 from NET.
1. Nemeth’s stated purpose of the loan was to purchase a 2002
Mercedes Benz.
2. Nemeth’s application included a listing of her employment with NEST.
3. NET Check No. 338774 was issued to Nemeth on November 21,
2006, in the amount of $15,000.00.
4. Check no. 338774 in the amount of $15,000.00 was deposited to
Wansacz’s personal account at Honesdale National Bank on
November 22, 2006.
150. In or about the same time period in 2006 when he was recommending bus contracts
for Nemeth d/b/a NEST, Wansacz entered into a bus contract with the Old Forge
School District (OFSD) utilizing a van NEST used in relation to its contract with
LSD.
151. Around August 2006, Anthony Spadoni, Business Manager of the Old Forge School
District, contacted Wansacz at the Lakeland School District to discuss Spadoni’s
need for the daily transportation of one student to different locations.
a. Spadoni contacted Wansacz in Wansacz’s official capacity as
Transportation Director of the Lakeland School District.
b. Wansacz informed Spadoni that his girlfriend (Nemeth) had a transportation
business that could fulfill the need and recommended her to Spadoni.
152. Arrangements to have Wansacz complete the bus run were made between Anthony
Spadoni, Business Manager, Old Forge School District and Wansacz.
a. Spadoni did not have any dealings directly with Kim Nemeth or anyone else
claiming to represent Northeast Student Transportation, other than John
Wansacz.
Wansacz, Jr., 08-033
Page 33
b. Wansacz served as the point of contact for the transportation services
provided by NEST to the Old Forge School District during the 2006-2007
school year.
153. On August 31, 2006, John Wansacz, Jr. entered into a contract with the Old Forge
School District for the transportation of one (1) student during the 2006-07 school
year at the contracted rate of $125.00 per day.
154. Transportation data submitted by Wansacz to the Old Forge School District for this
contract identified the vehicle to be used for this run as a 2001 Chevrolet bus/van
V.I.N. 1GNDX03EX1D18423.
a. Wansacz supplied the OFSD with a copy of the registration card for this
vehicle valid May 5, 2006, through January 31, 2007.
b. Wansacz supplied the OFSD with a copy of the insurance card for the
vehicle from Erie Insurance policy #Q102730431 valid October 27, 2006,
through October 27, 2007.
c. This vehicle was insured on Nemeth’s policy for Northeast Student
Transportation, Inc.
d. This was the same vehicle that was used by Nemeth d/b/a NEST as van 231
for the Lakeland School District during the 2005-06 school year.
155. Wansacz received four (4) payments totaling $17,160.00 from the Old Forge School
District during the 2006-07 school year associated with this contract.
a. These payments were generated as a result of handwritten invoices
submitted to the District by Wansacz.
b. The District’s business office would affix a stamp for the amount paid, date,
check number, vendor, account code and notation of services provided on
each invoice.
156. Business records of the Old Forge School District include invoices from John
Wansacz, Jr. along with corresponding payments made during the 2006-07 school
year.
157. The payments to Wansacz from the Old Forge School District were deposited to
Wansacz’s personal account no. 424592XXXX at Honesdale National Bank.
158. Wansacz and Nemeth shared living expenses since at least December 2006 when
Wansacz purchased the property at [Redacted Residence Address].
159. Nemeth purchased materials at Sherwin Williams, Lowe’s and Home Depot for
improvements to Wansacz’s property since its purchase in December 2006.
a. These purchases started within a week of the property purchase and
continued through the sale of Northeast Student Transportation.
160. In January 2007, Nemeth had four (4) purchases from Sherwin Williams in Eynon,
PA, and one (1) from Lowe’s using Bank of America charge account number 4305
[XXXX XXXX] XXXX. Account records reflect the transactions totaling $257.88.
161. In addition to the payments detailed in the previous finding, Nemeth had charges
Wansacz, Jr., 08-033
Page 34
from Home Depot, Lowe’s and Wal-Mart on both Gulf MasterCard accounts which
were for shared living expenses and/or improvements to their common residence,
owned by Wansacz.
a. Nemeth also made purchases of other living expenses from January 2007
through November 2008, including groceries, department store [purchases],
pharmaceuticals, home heating oil, furniture/housewares, plumbing, and
fitness club memberships.
162. On the same day that Nemeth received the $55,000.00 from the sale of NEST, she
began issuing checks to contractors and for materials for renovations to Wansacz’s
personal residence at [Redacted Residence Address]. (Finding #146)
a. Payments totaling $27,386.47 were made by Nemeth.
163. Nemeth deposited $107,141.26 to her personal account at NET as a result of
selling NEST.
a. Of that $107,141.26, $28,100.00 was paid directly to John Wansacz, Jr. in
the form of checks issued by Nemeth to Wansacz.
b. An additional $37,598.47 was paid by Nemeth for renovations to Wansacz’s
residence.
c. A payment was also issued to North American Warhorse on October 29,
2008, in the amount of $8,396.43 for the purchase of an ATV for Wansacz.
164. In or about January 2009 Wansacz began renovations and an addition to his
residence at [Redacted Residence Address].
a. Wansacz used the services of Scott Brace/Brace Construction.
b. No formal written contract was entered into between Brace and Wansacz.
1. An informal agreement was for Wansacz to purchase some of the
materials.
c. The informal agreement was negotiated between Wansacz and Scott Brace.
1. Nemeth did not negotiate with Brace.
2. Brace met Nemeth through Wansacz.
165. Payments totaling $30,800.00 were made to Brace from Nemeth’s NET account
between January 14, 2009, and April 24, 2009.
166. Wansacz, utilizing checks from Nemeth or Nemeth’s credit card(s), made purchases
of materials for his home renovation/addition from Doors Windows and More, 19
Greenride Street, Scranton, PA 18509, over a period of time, beginning February
18, 2009.
167. Between January 14, 2009, and June 9, 2009, six (6) invoices for the purchase of
building supplies from Doors Windows and More were made by Wansacz, totaling
approximately $8,629.38.
168. All six invoices from Doors, Windows and More indicate the materials were sold to
John Wansacz.
Wansacz, Jr., 08-033
Page 35
a. All materials were picked up by Wansacz since Doors, Windows and More
does not provide delivery service.
THE FOLLOWING FINDINGS RELATE TO THE CARBONDALE AREA SCHOOL
DISTRICT.
169. Wansacz has served as the Transportation Coordinator for the Carbondale Area
School District (CASD) from March 1, 2008, through June 30, 2009.
a. This position reports directly to the CASD Superintendent.
b. This position is part-time with expected hours of 1-2 days per week.
c. Wansacz did not have a set working schedule, but was required to work as
many hours as needed to handle the CASD’s transportation needs.
170. The CASD position of Transportation Coordinator has no formal job description;
however, general job duties include, but may not be limited to:
a. Identify contractors for special education van runs and other special
transportation needs;
b. Recommend contractors for special education and/or other special
transportation needs to the Superintendent and Board;
c. Review and approve mileage/run information submitted by contractors for
payment;
d. Identify and implement methods of reducing transportation costs district
wide;
e. Handle complaints from parents on transportation issues.
171. Prior to Wansacz being hired as the Transportation Coordinator, the CASD special
transportation needs [were] handled by Superintendent Dominick Famularo.
172. The CASD contracted with NEIU #19 for the transportation of special education
students prior to Wansacz becoming the District’s Transportation Coordinator.
a. The CASD was a member District of the Northeastern Educational
Intermediate Unit (NEIU #19).
173. Wansacz was hired by the CASD with the primary responsibility of reducing
transportation costs for special transportation needs.
a. The only CASD transportation contract bid at the time of Wansacz’s hiring
was the main busing contract.
174. Kim Nemeth individually and/or d/b/a Northeast Student Transportation did not have
any business dealings with the Carbondale Area School District prior to Wansacz
becoming that District’s Transportation Coordinator.
175. Wansacz selected Northeast Student Transportation to handle a special
transportation run for the District effective March 31, 2008, and continuing through
the end of the 2007-2008 school year.
Wansacz, Jr., 08-033
Page 36
a. This hiring occurred within a month of Wansacz’s hiring as Transportation
Coordinator.
b. Compensation was set at $89.00 per day.
c. Three additional contracts were given for the 2008-09 school year.
1. The contracts were awarded by the Board, based on
recommendations of Wansacz.
176. The selection of Nemeth d/b/a NEST was done solely by Wansacz, who
recommended to the Board that a contract be awarded.
a. The contract was not publicly advertised.
177. At the time of selecting Nemeth/NEST as a bus contractor for the CASD, Wansacz
and Nemeth were cohabitating at a home owned by Wansacz.
a. Nemeth was paying living expenses, including groceries and home fuel oil
for Wansacz’s home.
178. Wansacz, on behalf of Nemeth/Northeast Student Transportation, Inc. reported an
insurance claim to Erie Insurance on May 6, 2008, against policy #Q092630483.
a. Policy #Q092630483 was the commercial automobile policy for Northeast
Student Transportation, Inc.
b. During the September 26, 2007, through September 26, 2008, policy period,
insured vehicles included a 2002 Ford Van V.I.N #2FMZA524828A36436.
179. Erie Insurance records include one claim reported against policy # Q092630483.
a. The date of loss is identified as May 5, 2008.
b. Based on the value of the claim, no payment was made by Erie Insurance
and the claim was withdrawn by John Wansacz.
c. The vehicle involved in the claim was a 2002 Ford Van VIN#
2FMZA524828A36436.
d. The claim resulted from damages allegedly occurring after the vehicle was
stolen from the repair lot at Williams Diesel, Box 710 Route 6, Mayfield, PA.
180. A claims management auto loss report dated May 6, 2008, reflects that the claim
was reported by John Wansacz. Details are reported as follows:
“Insured had van at Williams Auto & Diesel Service they were on their way to pick it
up and it wasn’t there. Police were notified, they took statement. They need to have
the van replaced, they carry school children.”
a. This claim was closed on May 20, 2008, after being withdrawn by the
insured. The “insured found damage to be below the deductible.”
b. File documents include reflect [sic] contact was made with John (Wansacz)
on May 7, 2008. He advised that he “already had repairs completed, shake
being caused by bad brake rotor, repairs cost less than deductible, he
requested (to) cancel (the) claim at this point.”
Wansacz, Jr., 08-033
Page 37
181. On April 24, 2008, the Carbondale Area Board of School Directors approved the
retroactive hiring of Northeast Student Transportation to transport a student to the
Honesdale Acute Program at a rate of $89.00 per day effective March 31, 2008.
a. This approval was given based on Wansacz’s recommendation.
1. No evidence exists that any other bus contractors were considered or
recommended by Wansacz.
182. Wansacz’s use of the authority of his position as Transportation Coordinator for the
Carbondale Area School District resulting in contracts being awarded to Northeast
Student Transportation, Inc. increased the income of NEST and the overall value of
the business.
a. Wansacz recommended NEST be utilized by the CASD less than one month
after being appointed Transportation Coordinator.
b. Within seven months of using [his] position as CASD Transportation
Coordinator to recommend contracts be awarded to NEST, Wansacz began
receiving payments from Kimberly Nemeth emanating from NEST accounts.
183. Daily mileage/usage fees are determined through a formula established by the
Department of Education for these services.
a. Wansacz determines the length of run and number of students per run which
will affect the total paid.
184. Wansacz’s selection of Northeast Student Transportation, Inc. for Carbondale Area
School District van runs continued into the 2008-09 school year.
a. Northeast Student Transportation, Inc. had three (3) van runs for the 2008-
09 school year.
b. Approvals were given by the Board during [its] July 21, 2008, and September
11, 2008, meetings.
185. On July 21, 2008, the Carbondale Area Board of School Directors took action
approving contractors for the 2008-09 school year.
a. Twelve individuals/companies including NEST were approved as
contractors.
b. No rates or daily amounts to be paid were listed as being approved.
c. Also during this meeting Northeast Student Transportation was approved to
use three (3) vans to transport special needs students to Scranton and
Dunmore at a rate of $90.00 per day, per van for the summer session July 1-
August 6, 2008.
d. The actions taken by the CASD Board were done at the recommendation of
Wansacz.
1. The CASD Board took action less than one month prior to Nemeth
transferring ownership of NEST to the Schlastas.
186. On August 26, 2008, the Carbondale Area School District entered into a contract
Wansacz, Jr., 08-033
Page 38
with Northeast Student Transportation, Inc. to provide transportation services for
the 2008-09 school year.
a. This agreement was signed by Dominick Famularo, Superintendent and
Vladimir Schlasta representing Northeast Student Transportation.
1. The Schlastas were in the process of purchasing NEST from Kim
Nemeth at the time they were named officers of the corporation on
August 11, 2008.
2. Stock transfers were completed [in] October 2008.
3. At the time of the award of the contract Nemeth was still the owner of
all NEST stock.
b. This contract was for three (3) van runs at daily rates of $123.22, $132.16,
and $144.14.
c. This contract was valued at $71,913.60 for the 180 day school year ($123.22
+ $132.16 + $144.14 = $399.52 per day x 180 = $71,913.60).
187. On September 11, 2008, the Carbondale Area Board of School Directors again took
action approving bus/van contractor rates for the 2008-09 school year.
a. Approximately twelve (12) contractors were approved including Northeast
Student Transportation.
b. Approved daily rates for Northeast Student Transportation vehicles were
$123.22 and $132.16 and $144.14.
188. Vehicle registration, insurance and drivers information maintained by Wansacz in
his official capacity as Transportation Coordinator reflect the following drivers,
vehicles, and insurance was in place for Northeast Student Transportation, Inc. to
handle its contract for the 2008-09 school year.
a. Drivers
Thomas Cerra
Carmine Cerra
William R. Nesbitt
Tina A. Farrell
John J. Chindemi
b. Vehicles
2005 Chevrolet VIN #1GNDV03E65D102517
2002 Ford VIN #2FMZA524828A36436
1999 Plymouth VIN #2P4GP24G0XR216407
2007 Chevrolet VIN #1GNDV23WX7D219198
c. Insurance
2005 and 2007 Chevrolets: Selective Insurance, policy #S1287688 valid
July 27, 2008, through July 27, 2009
1999 Plymouth and 2002 Ford: Erie Insurance policy #Q092640022H valid
March 26, 2009, through September 26, 2009.
189. Payments issued by the District for special transportation services did not go before
the Board for approval by vendor name.
Wansacz, Jr., 08-033
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a. Payments were generated based on activity dates submitted to Wansacz for
approval.
b. These payments were processed as District payroll.
c. Wansacz’s signature was required on these documents to facilitate a
payment.
190. Carbondale Area School District checks issued to Northeast Student
Transportation, Inc. were mailed to P.O. Box 56, Jermyn, PA 18433 up through
December 5, 2008.
a. Kim Nemeth was the box holder of address P.O. Box 56, Jermyn, PA 18433.
b. On December 4, 2008, Wansacz instructed Assistant Business Manager
Kimberly Michalek to change the mailing address to 1821 Lakeland Drive
(Jermyn, PA 18433).
1. This is an address utilized by the Schlastas in the operation of NEST.
191. No less than twelve (12) payments were issued from the Carbondale Area School
District to Northeast Student Transportation during the time period when Wansacz
became Director of Transportation through the completion of the sale of the
business to Vladamir and David Schlasta on February 12, 2009.
192. Two payments issued to NEST by CASD totaling $9,856.00 were deposited to the
NEST account no. 42846XXXX at Honesdale National Bank controlled by Kimberly
Nemeth.
Check No. Amount Date of Deposit
14853 $3,916.00 07/31/08
15779 $5,940.00 09/17/08
a. Approximately seven (7) weeks after receiving the second check from CASD,
Nemeth began issuing payments to Wansacz.
THE FOLLOWING FINDINGS RELATE TO ALLEGED STATEMENT OF FINANCIAL
INTERESTS VIOLATIONS BY WANSACZ IN HIS OFFICIAL CAPACITY AS
TRANSPORTATION DIRECTOR FOR THE LAKELAND AND CARBONDALE AREA
SCHOOL DISTRICTS.
193. Wansacz, in his official capacities as Director of Transportation for the Lakeland
Area School District and as Transportation Coordinator for the Carbondale Area
School District, was annually required to file a Statement of Financial Interests by
May 1, [containing] information for the prior calendar year.
194. Wansacz was annually provided with blank Statement of Financial Interests forms
for completion.
195. Wansacz filed a Statement of Financial Interests with the LSD for the 2005 calendar
year.
196. The Statement of Financial Interests Wansacz filed with the Lakeland School
District included the following:
Wansacz, Jr., 08-033
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Calendar Year: 2005
Filed: No date on SEC form 01/06
Position: Director of Transportation
Creditors: None
Direct or Indirect Sources of Income: Lakeland School District, 1593 Lakeland
Drive, Jermyn and Heart Lake Lodge, 1298
Heart Lake Road, Jermyn
Office, Directorship or Employment
in any business: None
Financial Interest in any Business: None
All Other Financial Interests: None
197. Wansacz did not file Statement of Financial Interests forms by May 1, 2007, for
calendar year 2006, and May 1, 2008, for calendar year 2007, respectively.
198. Wansacz did not file Statement of Financial Interests forms for 2006 and 2007
calendar years based on advice of Attorney Jeffrey Nepa, his personal attorney.
199. On February 4, 2008, Nepa submitted a letter to the Lakeland School District in
care of Solicitor Patricia Jane Grande-Rieder regarding John Wansacz and
Statements of Financial Interests.
a. Nepa was asked by Wansacz to review relevant case law regarding filing
Statements of Financial Interests.
b. Nepa reviewed the definition of a public employee according to the
Pennsylvania Ethics Act.
1. Nepa’s opinion was the Director of Transportation did not fit that
description.
2. According to Nepa’s opinion Wansacz would be exempt from filing a
Statement of Financial Interests.
aa. Nepa advised Wansacz not to file Statements of Financial
Interests.
200. Wansacz did not seek an advice from the State Ethics Commission regarding his
obligation to annually file Statement of Financial Interests forms.
201. On August 19, 2008, the State Ethics Commission sent notification to John
Wansacz of its intent to commence civil penalty proceedings pursuant to 65 Pa.C.S.
§ 1109(f) for his deficiency and delinquency of Statement(s) of Financial Interests
which noted, in part, that Wansacz “filed deficient Statement(s) of Financial
Interests for calendar year(s) 2005 which are legally insufficient and fail to comply
with the Ethics Act. You have also failed to file Statement(s) of Financial Interests
for calendar year(s) 2006 and 2007.”
202. On September 9, 2008, a final notice of intent to commence civil penalty
proceedings was sent to Wansacz by certified mail number 7006 0100 0006 4924
3372.
203. Wansacz eventually filed Statement of Financial Interests forms with the Lakeland
School District for calendar years 2005, 2006, and 2007 on or after September 30,
2008.
a. Copies of these forms were faxed to the State Ethics Commission by the
Wansacz, Jr., 08-033
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LSD on November 7, 2008.
b. All three (3) of these filings were dated September 30, 2008.
c. None of the filings were timely filed based on filing due dates of May 1,
2006; May 1, 2007; and May 1, 2008 respectively.
204. Wansacz’s Statement of Financial Interests forms filed with the Lakeland School
District for calendar years 2005-2007 on or after September 30, 2008, included the
following disclosures and financial interests:
a. Calendar Year: 2007
Filed: 09/30/08 on SEC form SEC-1, Rev. 01/00
Address: [Redacted Residence Address]
Position: Director of Transportation
Creditors: Bank of America 11.9%, Home Depot 9.9%
Direct/Indirect Income: Lakeland School District, Heart Lake Lodge
Office, Directorship or employment in any business: Lakeland School District,
Director of Transportation; Heart
Lake Lodge, Manager
All Other Financial Interests: None
b. Calendar Year: 2006
Filed: 09/30/08 on SEC form SEC-1, Rev 01/08
Address: 1297 Heart Lake Road, Jermyn, PA 18433
Position: Director of Transportation
Creditors: Bank of America 11.9%
Direct/Indirect Income: Lakeland School District, Heart Lake Lodge
Office, Directorship or employment in any business: Lakeland School District,
Director of Transportation; Heart
Lake Lodge, Manager
All other Financial Interests: None
c. Calendar Year: 2005
Filed: 09/30/08 on SEC form SEC-1, Rev 01/08
Address: 1297 Heart Lake Road, Jermyn, PA 18433
Position: Director of Transportation
Creditors: None
Direct/Indirect Income: Lakeland School District, Heart Lake Lodge
Office, Directorship or employment in any business: Lakeland School District,
Director of Transportations; Heart
Lake Lodge, Manager
All other Financial Interests: None
205. Wansacz failed to list all sources of direct/indirect income in excess of $1,300.00 on
Statement of Financial Interests forms filed on September 30, 2008, for calendar
years 2006 and 2007.
a. Wansacz received payments totaling $13,032.71 from Kimberly Nemeth
between February 2006 and April 2006, which he deposited to his personal
bank account at Old Forge Bank on May 2, 2006.
b. Wansacz received a payment from the Old Forge School District on
December 22, 2006, in the amount of $2,785.00.
c. Wansacz received a payment in an amount of $6,000.00 from Vladimir and
David Schlasta on January 25, 2006, in the amount of $6,000.00.
Wansacz, Jr., 08-033
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206. Wansacz failed to disclose all direct/indirect sources of income he received from
Kim Nemeth, Old Forge School District and the Schlastas during the 2006 calendar
year.
a. Wansacz received at least four (4) checks totaling $13,032.71 from Nemeth
as detailed in Findings 65-66.
b. Wansacz received at least one (1) payment in the amount of $2,785.00 from
the Old Forge School District during 2006 (Check date 12/22/06).
c. Wansacz deposited a check from the Schlastas in the amount of $6,000.00
on January 25, 2006, to his personal account at Honesdale National Bank.
207. Wansacz did not disclose direct/indirect income payments he received from the Old
Forge School District, the Schlastas and Amanda and Eric Mancuso during the
2007 calendar year.
a. Wansacz received at least three (3) payments totaling $14,375.00 from the
Old Forge School District during 2007.
b. Wansacz received a payment in the amount of $4,500.00 from Eric and
Amanda Mancuso on or about March 2007, which was deposited on March
30, 2007, to his personal account at Honesdale National Bank.
c. Wansacz received an $11,000.00 payment from Vladimir and David Schlasta
in or about November 2007, which was deposited to his personal account at
Honesdale National Bank on November 9, 2007.
208. Wansacz filed a Statement of Financial Interests form with Lakeland School District
for calendar year 2008 on April 29, 2009, and Statement of Financial Interests form
for calendar year 2008 dated April 28, 2009, with the Carbondale Area School
District on April 29, 2009.
209. The information disclosed by Wansacz on the Statement of Financial Interests filed
with the CASD for the 2008 calendar year is identical to the information contained
on the Statement of Financial Interests filed for 2008 with the LSD.
210. Wansacz never disclosed on either Statement of Financial Interests filed for the
2008 calendar year the $27,600.00 in payments he received from Nemeth in
November 2008 and the payment made on his behalf by Nemeth to North American
Warhorse in the amount of $8,396.00.
211. Wansacz never disclosed $24,750.00 he received from the sale of stocks through
Ameritrade which was deposited to his personal account at Honesdale National
Bank on August 26, 2008.
a. Wansacz maintained an account with Ameritrade to account no 188-
XXXXXX.
b. In or about August 26, 2008, Wansacz sold stocks valued at $24,750.00.
c. The fees for sale of the stocks were wire transferred to his personal account
on August 26, 2008.
212. Wansacz failed to file a Statement of Financial Interests form by May 1, 2008, with
the Carbondale Area School District containing information for the 2007 calendar
Wansacz, Jr., 08-033
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year.
213. From or about January 2006 through 2008, John Wansacz, Jr. used the authority of
his public position as Transportation Director of the LSD and as Transportation
Coordinator for the CASD to recommend the awarding of contracts to Kim
Nemeth/NEST, at a time when he had a reasonable expectation that he would
receive a financial benefit from Nemeth/NEST.
214. Between 2006 and September 2008 payments received by Kim Nemeth/NEST from
LSD and CASD totaled $273,589.53.
215. Wansacz realized a private pecuniary gain of $13,032.71 as a result of four (4)
checks issued by the Lakeland School District to Kimberly Nemeth during the 2005-
06 school year. (See Finding #66).
216. Wansacz realized a financial gain as a result of funds Nemeth received from both
school districts which were used for improvements to Wansacz’s property located at
[Redacted Residence Address] since its purchase on December 27, 2006.
217. Wansacz realized a private pecuniary gain of $27,600.00 when he received
payments from Nemeth which he deposited to a private investment account.
218. Wansacz received a private pecuniary gain of $8,396.43 when he used funds
provided by Nemeth to purchase an ATV from North American Warhorse.
219. Wansacz realized a total private pecuniary gain of at least $49,529.20 as a result of
the use of his public positions.
III.DISCUSSION:
As Director of Transportation for the Lakeland School District (“LSD”) since June 22,
2005, and as Transportation Director/Coordinator for the Carbondale Area School District
(“CASD”) from March 1, 2008, through June 30, 2009, Respondent John Wansacz, Jr.,
hereinafter also referred to as “Respondent,” “Respondent Wansacz,” and “Wansacz,” has
been a public official/public employee subject to the provisions of the Public Official and
Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq.
The allegations as recited in the Consent Agreement are that Respondent Wansacz
violated Sections 1103(a), 1103(c), 1103(f), 1104(a), and 1105(b) of the Ethics Act:
(a) In his capacity as Director of Transportation for the LSD:
(1) When he used the authority of his public position for the private
pecuniary benefit of himself and/or a business with which he is
associated;
(2) When he participated in the selection of, recommended and/or
awarded contracts to Kimberly Nemeth and/or Northeast Student
Transportation (“NEST”), a business with which he is associated, to
provide services to the LSD;
(3) When he participated in the selection of, recommended and/or
awarded contracts to NEST and/or Kimberly Nemeth to provide
services to the LSD at a time when he had a reasonable expectation
that he would receive a financial benefit from said entity;
(4) When the contracts he participated in awarding to NEST in excess of
Wansacz, Jr., 08-033
Page 44
$500.00 were awarded without an open and public process;
(5) When he accepted payments from NEST and/or Kimberly Nemeth
based on the understanding that his official action would be
influenced thereby;
(6) When he participated in the selection of, recommended and/or
awarded contracts to NEST in order to fund the purchase of that
entity by Vladimir Schlasta and David Schlasta and when he
thereafter received proceeds from the sale of that entity;
(7) When he failed to file Statements of Financial Interests (“SFIs”) for
the 2006 and 2007 calendar years by May 1, 2007, and May 1, 2008;
(8) When, after filing SFI(s) for the 2006 and 2007 calendar years, he
failed to disclose all direct and indirect sources of income in excess of
$1,300.00;
(9) When he failed to disclose all direct and indirect sources of income in
excess of $1,300.00 on an SFI filed for the 2008 calendar year; and
(b) In his capacity as Transportation Director/Coordinator for the CASD:
(1) When he used the authority of his public position for the private
pecuniary benefit of himself and/or a business with which he is
associated by participating in the selection of, recommending and/or
awarding contracts to NEST, a business with which he is associated,
to provide services to the CASD;
(2) When he participated in the selection of, recommended and/or
awarded contracts to NEST to provide services to the CASD at a time
when he had a reasonable expectation that he would receive a
financial benefit from said entity;
(3) When the contracts he participated in awarding to NEST in excess of
$500.00 were awarded without an open and public process;
(4) When he accepted payments from NEST based on the understanding
that his official action as Transportation Director/Coordinator for the
CASD would be influenced thereby; and
(5) When he failed to file an SFI for the 2007 calendar year with the
CASD by May 1, 2008.
We initially note that as part of the Consent Agreement, the Investigative Division
has agreed to nol pros the particular allegations enumerated above as (a)(2), (a)(4), (a)(5),
(a)(6), (b)(1), (b)(3), and (b)(4). The remaining allegations pertain to Sections 1103(a),
1104(a), and 1105(b) of the Ethics Act. There are no remaining allegations under Section
1103(c) or Section 1103(f) of the Ethics Act.
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
Wansacz, Jr., 08-033
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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
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 1104(a) of the Ethics Act provides that each public official/public employee
must file an SFI for the preceding calendar year, each year that he holds the position and
the year after he leaves it.
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.
Wansacz has served as the Director of Transportation for the LSD since June 22,
2005. Wansacz also served as the Transportation Director/Coordinator for the CASD from
March 1, 2008, through June 30, 2009. Each position was part-time and reported to the
respective School District’s Superintendent.
Kimberly Ann Nemeth (“Nemeth”) is Wansacz’s girlfriend. Wansacz and Nemeth
have had a relationship since at least February 2006. Since at least February 2007,
Wansacz and Nemeth have shared a common residence at a certain property owned by
Wansacz, hereinafter referred to as “the Residence.”
Facts relating to Transportation Services for the LSD:
As Director of Transportation for the LSD, Wansacz’s duties and responsibilities
Wansacz, Jr., 08-033
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with regard to special education and other special van/bus transportation needs include
identifying specific bus/van routes, locating and recommending transportation contractors
for the specified routes, and reviewing and submitting to the LSD for payment the
calendars submitted by transportation contractors detailing dates and runs completed.
Transportation rates for special education vans/buses are established by the Pennsylvania
Department of Education.
Since June 2005 the LSD Board has consistently approved bus and van contracts
and route rates based on Wansacz’s recommendations without change. Bus contractors
are not awarded contracts without Wansacz’s recommendation. No formal bidding occurs
on these contracts.
Bus contractors get paid by preparing calendars documenting the days traveled for
each bus/van. As Director of Transportation, Wansacz signs such calendars to
recommend that payment be made. Based upon Wansacz’s signature, the calendars are
forwarded to the Business Manager to process for payment. Absent Wansacz’s signature,
the Board would not issue payment to the contractor. The LSD Board approves payments
to transportation contractors through the approval of monthly bill lists.
Since January 2006, Wansacz has used his position as Director of Transportation
to recommend that bus contracts be awarded by the LSD to Nemeth and “Northeast
Student Transportation, Inc.” (“NEST”), a corporation formed by Nemeth in August 2006.
The LSD did not utilize the services of Nemeth/NEST prior to Wansacz becoming
Director of Transportation. In or about January 2006, Wansacz recommended to the LSD
Board that Nemeth be awarded contracts to provide bus services for the remainder of the
2005-2006 school year. Bid quotes were not solicited from other contractors.
Beginning in or about January-February 2006, the LSD Board awarded Nemeth bus
contracts (two van routes) for the 2005-2006 school year, based upon Wansacz’s
recommendation. Nemeth was able to secure these routes as a result of Wansacz using
his position to recommend to the LSD Board that contracts be awarded to Nemeth. The
parties have stipulated that at the time Wansacz recommended that the bus contracts be
awarded to Nemeth, Wansacz had a reasonable expectation that he would receive a
financial benefit as a result. (Fact Findings 39, 67 d, 213).
At the time that Nemeth was awarded the aforesaid bus contracts, she did not own
any vehicles suitable for transporting special needs students. On December 13, 2005,
approximately one month prior to recommending the award of the LSD contract to Nemeth,
Wansacz purchased a 1999 Plymouth Voyager, and on February 2, 2006, at or about the
same time that Nemeth began to provide busing services to the LSD, Wansacz purchased
a 2001 Chevrolet Venture. Both of the aforesaid vehicles were insured by Wansacz and
used by Nemeth for LSD transportation services during the 2005-06 school year.
Wansacz served as a driver of one of the vehicles in providing bus services to the LSD.
The LSD requires transportation providers to submit copies of PennDOT
registrations, proof of insurance, and a list of drivers intended to be used on each bus/van
run. As Director of Transportation, Wansacz receives and maintains these records for the
LSD. Vehicle registration and insurance information supplied to the LSD by Wansacz for
the contracts awarded to Nemeth was for the 1999 Plymouth Voyager and 2001 Chevrolet
Venture that Wansacz owned.
Shortly after the aforesaid bus contracts were awarded to Nemeth, Wansacz
submitted correspondence to PennDOT identifying himself as the contractor. Specifically,
Wansacz submitted to PennDOT correspondence dated March 23, 2006, on LSD
stationery, in which Wansacz in his official capacity as Director of Transportation for the
LSD informed PennDOT of the following: “Please be advised that John Wansacz, Jr. has
Wansacz, Jr., 08-033
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a contract with Lakeland School District for the use of two vans for the 2005-2006 school
year. Mr. Wansacz is responsible for the transportation of students to and from school
along with activity trips.” (Fact Finding 44 a). This letter was signed by Wansacz. Nemeth
was not mentioned in this correspondence. The two vehicles that Wansacz referenced
were the 1999 Plymouth Voyager and 2001 Chevrolet Venture that Wansacz owned.
Nemeth completed contractor rate forms for the aforesaid vehicles used for the
2005-06 school year. Wansacz determined the length of the run, number of students, and
the contractor utilized.
The contract for the 1999 Plymouth Voyager owned by Wansacz had an effective
date of January 2, 2006. Nemeth was listed as the contractor. The contract was not
signed. The reimbursable cost per day was initially $113.95. However, the contract was
modified effective February 16, 2006, increasing the reimbursable cost per day from
$113.95 to $123.28. This increase was as a result of an increase in the approved number
of daily miles. The change was approved by the LSD Board during its March 15, 2006,
meeting at the recommendation of Wansacz.
The contract for the 2001 Chevrolet Venture owned by Wansacz had an effective
date of February 1, 2006. Nemeth was listed as the contractor. The reimbursable cost per
day of $139.41 was recommended by Wansacz and approved by the LSD Board on
February 15, 2006. No signatures are contained on the contract.
No evidence exists to suggest that Wansacz ever disclosed to the LSD Board that
these contracts were for services provided using vehicles that he owned, that he had filed
documents with PennDOT identifying himself as the contractor, or that he had a
reasonable expectation that he would be receiving payments as a result of these contracts.
Between January and June 2006, the LSD issued monthly checks to Nemeth in
payment of the aforesaid two van runs. These payments were generated based on the
monthly calendars/logs submitted by Nemeth to Wansacz and verified and recommended
for payment by Wansacz. Absent Wansacz’s verification and recommendation, no
payments would have been made.
During the 2005-06 school year the LSD issued to Nemeth eight checks totaling
$27,750.20 for transportation services. This total included payments for the aforesaid two
van runs and two additional payments totaling $722.50 for other transportation services
provided. These payments were made to Nemeth for services rendered utilizing vehicles
owned by Wansacz.
Of the $27,750.20 paid by the LSD to Nemeth for transportation services provided
during the 2005-06 school year, four checks totaling $13,032.71 were deposited into
Wansacz’s personal bank account for which he has sole signature authority, as detailed in
Fact Findings 65-67. The parties have stipulated that Wansacz realized a private
pecuniary gain of $13,032.71 as a result of receiving deposits of these four checks issued
by the LSD to Nemeth during the 2005-06 school year. (See, Fact Findings 65-67, 215).
In 2006, following an audit by the Pennsylvania Department of Auditor General, the
LSD Board determined that Wansacz had to divest himself of any financial interest in the
business and that all vehicles had to be placed in his girlfriend’s name. Wansacz stopped
serving as a driver for the LSD runs, and Nemeth incorporated and utilized NEST to
contract with the LSD for the 2006-07 through 2008-09 school years. The Articles of
Incorporation for NEST list Nemeth as the sole incorporator.
In his official capacity as Director of Transportation for the LSD, Wansacz
recommended increasing the number of van runs conducted by Nemeth/NEST for LSD to
four for the 2006-07 school year. On September 20, 2006, the LSD Board approved NEST
Wansacz, Jr., 08-033
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contract(s) for four bus/van runs for the 2006-07 school year. The contract(s) were
approved by the Board based on Wansacz’s recommendation and provided for payments
totaling $88,773.00 for the 2006-07 school year. The contract(s) were awarded without
competitive bidding. Although four runs were approved for the 2006-07 school year, only
three were provided. The contract(s) were not signed by any LSD officials and were not
executed by Nemeth until June 27, 2007.
The vehicles used by NEST for the LSD van runs during the 2006-07 school year
included the 1999 Plymouth Voyager that had been purchased by Wansacz. The 1999
Plymouth Voyager remained titled in Wansacz’s name until on or about November 28,
2006, when ownership was transferred to a dealership and then to Nemeth/NEST. The
other vehicles used by NEST for LSD van runs for the 2006-07 school year were
purchased by Nemeth/NEST during August and September 2006.
Payments issued to NEST for vehicle runs during the 2006-07 school year were
made on a monthly basis as a result of monthly reports submitted by Nemeth and verified
by Wansacz as the LSD Director of Transportation. NEST received from the LSD eleven
payments totaling $89,903.08 for services provided during the 2006-07 school year. Such
payments were for van runs and two additional payments totaling $655.00 for van
rentals/field trips. These payments were made as a result of contracts awarded to NEST
as recommended by Wansacz. Of the aforesaid amount, $13,685.49 was for the use of
the 1999 Plymouth Voyager while it was still owned by Wansacz.
In or around February of 2007, Wansacz provided an undated letter to the LSD
Board regarding his intent to cohabitate with the owner of NEST. On April 3, 2007, the
LSD Solicitor provided an opinion that no conflict of interest would exist merely as a result
of the cohabitation. The Solicitor’s opinion was based in part upon Wansacz’s assertion
that he had no ownership interest in the corporation and received no financial benefit from
the corporation. (Fact Finding 101 b).
On June 27, 2007, based upon Wansacz’s recommendations, the LSD Board
approved summer transportation contracts for three NEST van runs. These extended
contracts were not bid by the LSD.
On September 19, 2007, based upon Wansacz’s recommendations, the LSD Board
approved a contract with NEST totaling $132,587.66 for the 2007-08 school year. NEST
was approved for four van runs. Wansacz designated the routes. These contracts were
not put out for competitive bidding. Nemeth signed the contract on February 7, 2008,
approximately 4 ½ months after the contract was approved by the LSD. The contract was
not signed by any LSD officials.
Payments issued to NEST for vehicle runs during the 2007-2008 school year were
made on a monthly basis as a result of reports verified by Wansacz in his official capacity
as the LSD Director of Transportation. A total of $137,780.25 was paid by the LSD to
Nemeth/NEST during the 2007-08 school year for the aforesaid four van runs and extra
runs such as field trips. These payments were made as a result of no bid contracts
recommended by Wansacz and approved by the Board to NEST.
On or about August 11, 2008, Nemeth began the transfer of ownership of NEST to
two brothers named Vladimir and David Schlasta, as discussed further below.
On August 20, 2008, based upon Wansacz’s recommendations, the LSD Board
approved contract(s) with NEST totaling $111,504.47 for the 2008-09 school year. NEST
was approved for four van runs. Wansacz designated the routes. The contract(s) were
not put out for competitive bidding. The contract(s) were awarded while Nemeth still
owned all of the NEST stock. No LSD officials signed the contract(s) awarded to NEST.
Wansacz, Jr., 08-033
Page 49
NEST continued to get paid on a monthly basis for student transportation runs for
the LSD during the 2008-09 school year. These payments were based on Wansacz’s
approval of monthly run logs submitted to the LSD.
Facts relating to Transportation Services for the Old Forge School District:
In or about August 2006, Anthony Spadoni (“Spadoni”), Business Manager of the
Old Forge School District (“OFSD”), contacted Wansacz in his official capacity as
Transportation Director for the LSD to discuss Spadoni’s need for the daily transportation
of one OFSD student. Wansacz informed Spadoni that his girlfriend had a transportation
business that could fulfill the need and recommended her to Spadoni. Arrangements to
have Wansacz complete the bus run were made between Spadoni and Wansacz.
On August 31, 2006, Wansacz entered into a contract with the OFSD for the
transportation of one student during the 2006-07 school year. During the 2006-07 school
year, Wansacz received four payments totaling $17,160.00 from the OFSD associated with
this contract. These payments were deposited into Wansacz’s personal bank account.
Facts relating to Transportation Services for the CASD:
Wansacz served as the Transportation Director/Coordinator for the CASD from
March 1, 2008, through June 30, 2009. Wansacz’s duties as CASD Transportation
Director/Coordinator included, inter alia, identifying contractors for special education van
runs and other special transportation needs, recommending contractors for special
education and/or other special transportation needs to the Superintendent and Board, and
reviewing and approving mileage/run information submitted by contractors for payment.
Nemeth/NEST did not have any business dealings with the CASD prior to Wansacz
becoming CASD Transportation Director/Coordinator. Within one month of Wansacz
being hired as CASD Transportation Director/Coordinator, Wansacz selected NEST to
handle a special transportation run for the CASD effective March 31, 2008, and continuing
through the end of the 2007-2008 school year. The contract was not publicly advertised.
Compensation was set at $89.00 per day. The contract was awarded by the CASD Board
based on recommendations of Wansacz.
Wansacz’s use of the authority of his position as CASD Transportation
Director/Coordinator resulted in contracts being awarded to NEST, increasing the income
of NEST and the overall value of the business.
Wansacz’s selection of NEST for CASD van runs continued into the 2008-09 school
year. NEST had three van runs for the 2008-09 school year. Approvals were given by the
CASD Board during its July 21, 2008, and September 11, 2008, meetings. The actions
taken by the CASD Board were done at the recommendation of Wansacz.
On August 26, 2008, the CASD entered into a contract with NEST to provide
transportation services for the 2008-09 school year. This agreement was signed by
Vladimir Schlasta representing NEST. The Schlastas were in the process of purchasing
NEST from Nemeth, and they were corporate officers. At the time of the award of the
contract, Nemeth was still the owner of all NEST stock. This contract was for three van
runs and was valued at $71,913.60 for the school year.
No less than twelve payments were issued from the CASD to NEST during the time
period when Wansacz became Transportation Director/Coordinator through the completion
of the sale of NEST to the Schlastas on February 12, 2009. Payments were generated
based on activity dates submitted to Wansacz for approval. These payments were
processed as CASD payroll. Wansacz’s signature was required on these documents to
facilitate payment.
Wansacz, Jr., 08-033
Page 50
Two payments issued to NEST by CASD totaling $9,856.00 were deposited in July
and September 2008 to the NEST bank account controlled by Nemeth.
The sale of NEST to the Schlastas:
On or about August 11, 2008, Nemeth began the transfer of ownership of NEST to
Vladimir and David Schlasta. This process was not completed until a $55,000.00 payment
dated December 24, 2008, from the Schlastas was deposited into Nemeth’s personal credit
union account on February 10, 2009.
On August 11, 2008, Nemeth resigned as an officer and board member of NEST,
and Vladimir and David Schlasta were named as NEST officers and board members.
On October 14, 2008, Nemeth transferred all NEST stock to the Schlastas. The
total value of all corporate stock was listed as $55,000.00. Payment for the stock was not
made by the Schlastas at that time.
The change in ownership of NEST was recorded with the Pennsylvania Department
of State effective November 3, 2008. At that time, the Schlastas’ business account for
NEST did not have sufficient funds to pay for the stock transfer.
On or about December 24, 2008, Vladimir Schlasta issued NEST check number
1060 in the amount of $55,000.00 to Nemeth for the purchase of NEST. The check was
not deposited to Nemeth’s personal credit union account until February 10, 2009. The
check cleared the Schlastas’ account on February 12, 2009.
During the ownership transition period, NEST continued to provide transportation
services to the LSD and CASD under Wansacz’s general supervision. Between November
3, 2008, and December 24, 2008, Wansacz recommended the payment of monthly van
runs to NEST, and NEST received eight payments totaling $47,790.55 from the LSD and
CASD. Between December 24, 2008, and February 12, 2009, Wansacz continued to
recommend that transportation payments be made to NEST, and an additional six
payments totaling $22,617.03 were made. Based upon the Stipulated Findings, it appears
that at least part of the Schlastas’ payment for purchasing NEST was funded by
LSD/CASD payments under transportation contracts recommended by Wansacz.
In October 2008 Nemeth closed out the NEST bank account and deposited the
$52,141.26 balance to her personal account. From those funds, Nemeth issued
$27,600.00 to Wansacz between November 6, 2008, and November 13, 2008. These
payments were deposited into an investment account owned solely by Wansacz.
Wansacz realized a private pecuniary gain of $27,600.00 when he received these
payments.
The parties have stipulated that on or about October 29, 2008, Wansacz received a
private pecuniary gain of $8,396.43 when he used money provided by Nemeth--just seven
days after the NEST account balance was deposited into Nemeth’s account--to purchase
an ATV (all terrain vehicle) and accessories.
Utilizing funds from the NEST account and funds received from the Schlastas for the
sale of NEST, Nemeth issued payments totaling $37,386.47 for renovations to the
Residence owned by Wansacz. In addition, Nemeth made other payments for shared
living expenses and/or improvements to the Residence owned by Wansacz.
Total Private Pecuniary Benefit to Wansacz:
The parties have stipulated that from or about January 2006 through 2008,
Wansacz, Jr., 08-033
Page 51
Wansacz used the authority of his public position as Director of Transportation for the LSD
and as Transportation Director/Coordinator for the CASD to recommend the awarding of
contracts to Nemeth/NEST, at a time when he had a reasonable expectation that he would
receive a financial benefit from Nemeth/NEST. (Fact Findings 39, 67 d, 213).
The parties have stipulated that Wansacz realized a total private pecuniary gain of
at least $49,529.20 as a result of the aforesaid use of his public positions.
Facts relating to Wansacz’s SFIs:
As Director of Transportation for the LSD and as Transportation
Director/Coordinator for the CASD, Wansacz was required to annually file an SFI with
each School District by May 1, disclosing information for the prior calendar year.
Wansacz did not timely file SFIs with the LSD for the 2006 and 2007 calendar
years. Wansacz did not timely file an SFI with the CASD for the 2007 calendar year.
Wansacz did not timely file SFIs for the 2006 and 2007 calendar years based on the
advice of his personal attorney that he was not required to file the forms. Wansacz did not
seek an advisory from this Commission regarding his obligation to file SFIs.
In August and September 2008, the Investigative Division of the State Ethics
Commission notified Wansacz of its intent to commence civil penalty proceedings pursuant
to 65 Pa.C.S. § 1109(f) for Wansacz’s deficient and delinquent SFIs.
On or after September 30, 2008, Wansacz filed SFI forms with the LSD for calendar
years 2005, 2006, and 2007. All three of these filings were dated September 30, 2008.
Wansacz failed to list all direct/indirect sources of income in excess of $1,300.00 on
the SFIs for calendar years 2006 and 2007.
For calendar year 2006, Wansacz failed to disclose Nemeth, the OFSD, and
Vladimir and David Schlasta as direct/indirect sources of income, despite having received
income well in excess of the reporting threshold from each of these sources. Wansacz
had received payments totaling $13,032.71 from Kimberly Nemeth between February 2006
and April 2006, as detailed in Fact Findings 65-67. Wansacz had received a payment
from the OFSD on December 22, 2006, in the amount of $2,785.00. Wansacz had
received a payment of $6,000.00 from Vladimir and David Schlasta on January 25, 2006.
For calendar year 2007, Wansacz did not disclose the OFSD, Vladimir and David
Schlasta, and Amanda and Eric Mancuso as direct/indirect sources of income, despite
having received income well in excess of the reporting threshold from each of these
sources. Wansacz had received at least three payments totaling $14,375.00 from the
OFSD during 2007. Wansacz had received an $11,000.00 payment from Vladimir and
David Schlasta in or about November 2007, which was deposited to his personal bank
account on November 9, 2007. Wansacz had received a payment in the amount of
$4,500.00 from Eric and Amanda Mancuso on or about March 2007, which was deposited
to his personal bank account on March 30, 2007.
On April 29, 2009, Wansacz filed SFI forms with LSD and CASD for calendar year
2008. The information disclosed on the two forms was identical. Wansacz did not
disclose Nemeth as a direct/indirect source of income, despite having received income
from Nemeth well in excess of the reporting threshold. Wansacz also did not disclose any
source(s) of income in excess of the reporting threshold received from the sale of stocks
through Ameritrade in August 2008.
Wansacz, Jr., 08-033
Page 52
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 dated January 28, 2010, 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 a violation of Section 1103(a) of the Public Official
and Employee Ethics Act, 65 Pa.C.S. §1103(a),
occurred when, as Director of Transportation for the
Lakeland School District, Wansacz participated in the
selection, recommendation and/or awarding of
contracts to Northeast Student Transportation and/or
Kimberly Nemeth to provide services to the district, at a
time when he had a reasonable expectation that he
would receive a financial benefit from said entity;
b. That a violation of Section 1104(a) of the Public Official
and Employee Ethics Act, 65 Pa.C.S. §1104(a),
occurred when Wansacz failed to file Statements of
Financial Interests for the 2006 and 2007 calendar
years by May 1, 2007 and May 1, 2008, with the
Lakeland School District;
c. That a violation of Section 1105(b) of the Public Official
and Employee Ethics Act, 65 Pa.C.S. §1105(b),
occurred when, after filing a Statement of Financial
Interests for the 2006 and 2007 calendar years,
Wansacz failed to disclose all direct and indirect
sources of income in excess of $1,300.00 and failed to
disclose all direct and indirect sources of income in
excess of $1,300.00 on a Statement of Financial
Interest filed for the 2008 calendar year;
d. That a violation of Section 1103(a) of the Public Official
and Employee Ethics Act, 65 Pa.C.S. §1103(a),
occurred when, as Transportation Coordinator for the
Carbondale Area School District, Wansacz participated
in the selection, recommendation and/or awarding of
contracts to Northeast Student Transportation to
provide services to the district, at a time when he had a
reasonable expectation that he would receive a
financial benefit from said entity;
e. That a violation of Section 1104(a) of the Public Official
and Employee Ethics Act, 65 Pa.C.S. §1104(a),
occurred when Wansacz failed to file a Statement of
Financial Interests for the 2007 calendar year with the
Carbondale Area School District by May 1, 2008;
. . . .
5. Wansacz agrees to make payment in the amount of
$49,529.20 in settlement of this matter payable to the
Commonwealth of Pennsylvania and forwarded to the
Wansacz, Jr., 08-033
Page 53
Pennsylvania State Ethics Commission within thirty (30) days
of the issuance of the final adjudication in this matter.
6. Wansacz agrees to file full and accurate Statements of
Financial Interests with Lakeland School District, through the
Pennsylvania State Ethics Commission, for calendar years
2006 and 2007 within thirty (30) days of the issuance of the
final adjudication in this matter.
7. Wansacz agrees to file [a] full and accurate Statement of
Financial Interests for the 2007 calendar year with Carbondale
Area School District, through the Pennsylvania State Ethics
Commission, within thirty (30) days of the issuance of the final
adjudication in this matter.
8. Wansacz agrees, subject to paragraph nine (9) below, that he
will neither seek nor hold any position of public office or public
employment in the Commonwealth of Pennsylvania, or any
political subdivision thereof, in which by virtue of said office or
employment Wansacz would possess either actual or implied
authority concerning the recommendation, consideration,
discussion, authorization, approval, execution or supervision
of any contract between the public entity and any
contractor/subcontractor from the date of this agreement
forward.
9. The foregoing is not intended to prohibit Wansacz from
rendering services to any governmental body as an
independent contractor (either directly or through
subcontractors) where Wansacz had no involvement in the
selection/approval of the initial contract as set forth in
paragraph eight (8) above.
10. The Investigative Division will recommend that the State Ethics
Commission take no further action in this matter; and make no
specific recommendations to any law enforcement or other
authority to take action in this matter. Such, however, does
not prohibit the Commission from initiating appropriate
enforcement actions in the event of Respondent's failure to
comply with this agreement or the Commission's order or
cooperating with any other authority who may so choose to
review this matter further.
Consent Agreement, at 2-5.
In considering the Consent Agreement, we shall initially consider the parties’
recommendations for two findings of violations of Section 1103(a) of the Ethics Act. Each
element of the recommended violations has been established.
With regard to the LSD, the parties have stipulated that since January 2006,
Wansacz used the authority of his public position as LSD Director of Transportation to
recommend that bus contracts be awarded by the LSD to Nemeth and NEST.
The LSD Board first awarded Nemeth bus contracts (two van routes) for the 2005-
2006 school year. These contracts were awarded as a result of Wansacz using the
authority of his position to recommend to the LSD Board that contracts be awarded to
Nemeth. The parties have stipulated that at the time Wansacz recommended that the bus
Wansacz, Jr., 08-033
Page 54
route contracts be awarded to Nemeth, Wansacz had a reasonable expectation that he
would receive a financial benefit as a result. (Fact Findings 39, 67 d, 213). Wansacz
owned the vehicles that were used to fulfill the contracts, drove one of the vehicles, and
informed PennDOT that he was the contractor for these contracts with the LSD.
Wansacz further used the authority of his public position when he determined the
length of the runs and recommended a modification to one of the aforesaid LSD contracts
with Nemeth to increase the reimbursable cost per day as a result of an increase in the
approved number of daily miles. The change was approved by the LSD Board during its
March 15, 2006, meeting at the recommendation of Wansacz.
Wansacz used the authority of his public position as Director of Transportation for
the LSD when he recommended increasing the number of van runs conducted by
Nemeth/NEST for LSD for the 2006-07 school year. On September 20, 2006, the LSD
Board approved the NEST contracts for the 2006-07 school year based on Wansacz’s
recommendation.
On June 27, 2007, based upon Wansacz’s recommendations, the LSD Board
approved summer transportation contracts for three NEST van runs.
On September 19, 2007, based upon Wansacz’s recommendations, the LSD Board
approved a contract with NEST totaling $132,587.66 for the 2007-08 school year.
On August 20, 2008, based upon Wansacz’s recommendations, the LSD Board
approved contract(s) with NEST totaling $111,504.47 for the 2008-09 school year. The
contract(s) were awarded while Nemeth still owned all of the NEST stock and was in the
process of selling NEST to the Schlastas.
None of the aforesaid contracts were put out for competitive bidding.
For each of the aforesaid school years, Wansacz further used the authority of his
public position to verify and recommend for payment the monthly calendars/logs submitted
by Nemeth/NEST.
Wansacz’s aforesaid official actions resulted in LSD monies flowing to
Nemeth/NEST. Nemeth received from the LSD a total of $27,750.20 for transportation
services provided during the 2005-06 school year. NEST received a total of $89,903.08
for transportation services provided during the 2006-07 school year, and a total of
$137,780.25 for transportation services provided during the 2007-08 school year. NEST
also continued to get paid on a monthly basis for student transportation runs for the LSD
during the 2008-09 school year, when NEST was being sold to the Schlastas.
With regard to the CASD, Nemeth/NEST did not have any business dealings with
the CASD prior to Wansacz becoming CASD Transportation Director/Coordinator. Within
one month of Wansacz being hired as CASD Transportation Director/Coordinator,
Wansacz used the authority of his public position to select NEST to handle a special
transportation run for the CASD effective March 31, 2008, and continuing through the end
of the 2007-2008 school year. The contract was not publicly advertised. The contract was
awarded by the CASD Board based on recommendations of Wansacz.
Wansacz’s use of the authority of his position as CASD Transportation
Director/Coordinator resulted in contracts being awarded to NEST, increasing the income
and overall value of the business.
Wansacz’s selection of NEST for CASD van runs continued into the 2008-09 school
year. The CASD Board approved three van runs for NEST for the 2008-09 school year at
the recommendation of Wansacz. At the time of the award of the contract, Nemeth was
Wansacz, Jr., 08-033
Page 55
still the owner of all NEST stock, and the Schlastas were in the process of purchasing
NEST. This contract was valued at $71,913.60 for the school year.
No less than twelve payments were issued from the CASD to NEST during the time
period when Wansacz became Transportation Director/Coordinator through the completion
of the sale of NEST to the Schlastas on February 12, 2009. Two such payments totaling
$9,856.00 were deposited in July and September 2008 to the NEST bank account
controlled by Nemeth. Payments were generated based on activity dates submitted to
Wansacz for approval.
The parties have stipulated that from or about January 2006 through 2008,
Wansacz used the authority of his public position as Director of Transportation for the LSD
and as Transportation Director/Coordinator for the CASD to recommend the awarding of
contracts to Nemeth/NEST, at a time when he had a reasonable expectation that he would
receive a financial benefit from Nemeth/NEST. (Fact Findings 39, 67 d, 213). As detailed
in the Fact Findings, as LSD and CASD monies flowed to Nemeth/NEST, Wansacz
received a private pecuniary gain, which included deposits of such payments into
Wansacz’s personal bank account and direct payments made by Nemeth to Wansacz from
such funds. Wansacz realized a total private pecuniary gain of at least $49,529.20 as a
result of the aforesaid use of his public positions.
With each element of the recommended violations of Section 1103(a) established,
we hold that a violation of Section 1103(a) of the Ethics Act occurred when, as Director of
Transportation for the LSD, Wansacz participated in the selection, recommendation and/or
awarding of contracts to NEST and/or Nemeth to provide services to the LSD, at a time
when he had a reasonable expectation that he would receive a financial benefit from
NEST/Nemeth. We further hold that a violation of Section 1103(a) of the Ethics Act
occurred when, as Transportation Director/Coordinator for the CASD, Wansacz
participated in the selection, recommendation and/or awarding of contracts to NEST to
provide services to the CASD, at a time when he had a reasonable expectation that he
would receive a financial benefit from NEST.
We shall now consider the parties’ recommendations as to the allegations involving
Wansacz’s SFIs.
We hold that a violation of Section 1104(a) of the Ethics Act occurred when
Wansacz failed to file SFIs for the 2006 and 2007 calendar years by May 1, 2007, and
May 1, 2008, with the LSD. Wansacz’s reliance on the erroneous advice of his personal
attorney, who opined that Wansacz was not required to file SFIs, does not excuse
Wansacz’s failure to timely file the forms.
We hold that a violation of Section 1105(b) of the Ethics Act occurred when
Wansacz failed to disclose all direct and indirect sources of income in excess of $1,300.00
on the SFIs that he filed on or after September 30, 2008, for calendar years 2006 and
2007, and the SFIs that he filed on April 29, 2009, for calendar year 2008.
Factually, for calendar year 2006, Wansacz failed to disclose Nemeth, the OFSD,
and Vladimir and David Schlasta as direct/indirect sources of income, despite having
received income well in excess of the reporting threshold from each of these sources. For
calendar year 2007, Wansacz did not disclose the OFSD, Vladimir and David Schlasta,
and Amanda and Eric Mancuso as direct/indirect sources of income, despite having
received income well in excess of the reporting threshold from each of these sources. For
calendar year 2008, Wansacz did not disclose Nemeth as a direct/indirect source of
income, despite having received income from Nemeth well in excess of the reporting
threshold. Wansacz also did not disclose any source(s) of income in excess of the
reporting threshold as to the sale of stocks through Ameritrade in August 2008. (See,
Abraham, Opinion 03-008, at 4, as to reporting income from securities.)
Wansacz, Jr., 08-033
Page 56
We hold that a violation of Section 1104(a) of the Ethics Act occurred when
Wansacz failed to file an SFI for the 2007 calendar year with the CASD by May 1, 2008.
As part of the Consent Agreement, Wansacz has agreed to make payment in the
amount of $49,529.20 payable to the Commonwealth of Pennsylvania and forwarded to
this Commission within thirty (30) days of the issuance of the final adjudication in this
matter.
Wansacz has further agreed to file full and accurate SFIs for calendar years 2006
and 2007 with the LSD, through this Commission, within thirty (30) days of the issuance of
the final adjudication in this matter.
Wansacz has agreed to file a full and accurate SFI for the 2007 calendar year with
the CASD, through this Commission, within thirty (30) days of the issuance of the final
adjudication in this matter.
Finally, Wansacz has agreed that he will neither seek nor hold any position of
public office or public employment in the Commonwealth of Pennsylvania, or any political
subdivision thereof, in which by virtue of said office or employment Wansacz would
possess either actual or implied authority concerning the recommendation, consideration,
discussion, authorization, approval, execution or supervision of any contract between the
public entity and any contractor/subcontractor from the date of the Consent Agreement
(January 28, 2010) forward. The parties have agreed that this is not intended to prohibit
Wansacz from rendering services to any governmental body as an independent contractor
(either directly or through subcontractors) where Wansacz had no involvement in the
selection/approval of the initial contract as a public official/public employee.
We note that the Consent Agreement does not address the filing of amended SFIs
for calendar year 2008. However, we accept the Consent Agreement submitted by the
parties as a proper disposition for this case based upon the totality of the facts and
circumstances.
Accordingly, per the Consent Agreement of the parties, Wansacz is directed to
make payment in the amount of $49,529.20 payable to the Commonwealth of Pennsylvania
th
and forwarded to this Commission by no later than the thirtieth (30) day after the mailing
date of this adjudication and Order.
Wansacz is directed to file full and accurate SFIs for calendar years 2006 and 2007
th
with the LSD, through this Commission, by no later than the thirtieth (30) day after the
mailing date of this adjudication and Order.
Wansacz is further directed to file a full and accurate SFI for calendar year 2007
th
with the CASD, through this Commission, by no later than the thirtieth (30) day after the
mailing date of this adjudication and Order.
Per the Consent Agreement of the parties, Wansacz is directed that he is to neither
seek nor hold any position of public office or public employment in the Commonwealth of
Pennsylvania, or any political subdivision thereof, in which by virtue of said office or
employment Wansacz would possess either actual or implied authority concerning the
recommendation, consideration, discussion, authorization, approval, execution or
supervision of any contract between the public entity and any contractor/subcontractor
from the date of the Consent Agreement (January 28, 2010) forward. This is not intended
to prohibit Wansacz from rendering services to any governmental body as an independent
contractor (either directly or through subcontractors) where Wansacz had no involvement
in the selection/approval of the initial contract as a public official/public employee.
Wansacz, Jr., 08-033
Page 57
Compliance with the foregoing will result in the closing of this case with no further
action by this Commission. Noncompliance will result in the institution of an order
enforcement action.
IV.CONCLUSIONS OF LAW:
1. As Director of Transportation for the Lakeland School District (“LSD”) since June
22, 2005, and as Transportation Director/Coordinator for the Carbondale Area
School District (“CASD”) from March 1, 2008, through June 30, 2009, Respondent
John Wansacz, Jr. (“Wansacz”) has been a public official/public employee subject
to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65
Pa.C.S. § 1101 et seq.
2. Wansacz violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when,
as Director of Transportation for the LSD, he participated in the selection,
recommendation and/or awarding of contracts to Northeast Student Transportation,
Inc. (“NEST”) and/or Kimberly Nemeth (“Nemeth”) to provide services to the LSD, at
a time when he had a reasonable expectation that he would receive a financial
benefit from NEST/Nemeth.
3. A violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred
when, as Transportation Director/Coordinator for the CASD, Wansacz participated
in the selection, recommendation and/or awarding of contracts to NEST to provide
services to the CASD, at a time when he had a reasonable expectation that he
would receive a financial benefit from NEST.
4. A violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred
when Wansacz failed to file Statements of Financial Interests (“SFIs”) for the 2006
and 2007 calendar years by May 1, 2007, and May 1, 2008, with the LSD.
5. A violation of Section 1105(b) of the Ethics Act, 65 Pa.C.S. § 1105(b), occurred
when Wansacz failed to disclose all direct and indirect sources of income in excess
of $1,300.00 on the SFIs that he filed on or after September 30, 2008, for calendar
years 2006 and 2007, and the SFIs that he filed on April 29, 2009, for calendar year
2008.
6. A violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred
when Wansacz failed to file an SFI for the 2007 calendar year with the CASD by
May 1, 2008.
In Re: John Wansacz, Jr., : File Docket: 08-033
Respondent : Date Decided: 3/25/10
: Date Mailed: 4/9/10
ORDER NO. 1549
1. John Wansacz, Jr. (“Wansacz”), a public official/public employee in his capacity as
Director of Transportation for the Lakeland School District (“LSD”) since June 22,
2005, and as Transportation Director/Coordinator for the Carbondale Area School
District (“CASD”) from March 1, 2008, through June 30, 2009, violated Section
1103(a) of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. §
1103(a), when, as Director of Transportation for the LSD, he participated in the
selection, recommendation and/or awarding of contracts to Northeast Student
Transportation, Inc. (“NEST”) and/or Kimberly Nemeth (“Nemeth”) to provide
services to the LSD, at a time when he had a reasonable expectation that he would
receive a financial benefit from NEST/Nemeth.
2. A violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred
when, as Transportation Director/Coordinator for the CASD, Wansacz participated
in the selection, recommendation and/or awarding of contracts to NEST to provide
services to the CASD, at a time when he had a reasonable expectation that he
would receive a financial benefit from NEST.
3. A violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred
when Wansacz failed to file Statements of Financial Interests (“SFIs”) for the 2006
and 2007 calendar years by May 1, 2007, and May 1, 2008, with the LSD.
4. A violation of Section 1105(b) of the Ethics Act, 65 Pa.C.S. § 1105(b), occurred
when Wansacz failed to disclose all direct and indirect sources of income in excess
of $1,300.00 on the SFIs that he filed on or after September 30, 2008, for calendar
years 2006 and 2007, and the SFIs that he filed on April 29, 2009, for calendar year
2008.
5. A violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred
when Wansacz failed to file an SFI for the 2007 calendar year with the CASD by
May 1, 2008.
6. Per the Consent Agreement of the parties, Wansacz is directed to make payment in
the amount of $49,529.20 payable to the Commonwealth of Pennsylvania and
forwarded to the Pennsylvania State Ethics Commission by no later than the
th
thirtieth (30) day after the mailing date of this Order.
7. Wansacz is directed to file full and accurate SFIs for calendar years 2006 and 2007
with the LSD, through the Pennsylvania State Ethics Commission, by no later than
th
the thirtieth (30) day after the mailing date of this Order.
8. Wansacz is directed to file a full and accurate SFI for calendar year 2007 with the
CASD, through the Pennsylvania State Ethics Commission, by no later than the
th
thirtieth (30) day after the mailing date of this Order.
9. Per the Consent Agreement of the parties, Wansacz is directed that he is to neither
Wansacz, Jr., 08-033
Page 59
seek nor hold any position of public office or public employment in the
Commonwealth of Pennsylvania, or any political subdivision thereof, in which by
virtue of said office or employment Wansacz would possess either actual or implied
authority concerning the recommendation, consideration, discussion, authorization,
approval, execution or supervision of any contract between the public entity and
any contractor/subcontractor from the date of the Consent Agreement (January 28,
2010) forward. This is not intended to prohibit Wansacz from rendering services to
any governmental body as an independent contractor (either directly or through
subcontractors) where Wansacz had no involvement in the selection/approval of the
initial contract as a public official/public employee.
10. Compliance with Paragraphs 6, 7, 8, and 9 of this Order will result in the closing of
this case with no further action by this Commission.
a. Non-compliance will result in the institution of an order enforcement action.
BY THE COMMISSION,
___________________________
Louis W. Fryman, Chair