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HomeMy WebLinkAbout1603 Keller In Re: John Keller, : File Docket: 10-045 Respondent : X-ref: Order No. 1603 : Date Decided: 4/12/12 : Date Mailed: 5/3/12 Before: Louis W. Fryman, 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 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. I.ALLEGATIONS: That John Keller, a public official/public employee in his capacity as a Member and Chairman of The Harrisburg Authority, violated Sections 1103(a) and 1105(b) of the State Ethics Act (Act 93 of 1998), 65 Pa.C.S. §§ 1103(a) and 1105(b), when he used the authority of his public position for a private pecuniary gain of a member of his immediate family and/or a business with which a member of his immediate family is associated by participating in discussions and actions of the Authority to award contracts valued in excess of $500 to J2 Consulting, a business with which his son is associated, when the contracts were entered into with J2 Consulting without an open and public process and when he subsequently participated in actions of the Authority to approve payments issued to J2 Consulting; and when he used the authority of his public position to obtain computer equipment and accessories purchased by the Authority and converted these items for his personal use. II.FINDINGS: 1. John Keller served as a Member of the Board of Directors (“Board”) of The Harrisburg Authority (“THA”) from March 1990 until January 2008. a. Keller was appointed to the THA Board by Harrisburg Mayor Stephen Reed in 1990 and was re-appointed by Reed in 1993, 1998, and 2002. Keller, 10-045 Page 2 2. Keller served as Chairman of the Board of THA from 2004 through 2005 and from January 2007 to September 5, 2007. a. Keller was removed as Chairman by vote of the Board on September 5, 2007. b. Keller served as Vice-Chairman from 1999 through 2003 and in 2006. 3. Keller has been employed as a professional bus driver with Capital Area Transit (“CAT”) since 1977. 4. THA was formed by the City of Harrisburg pursuant to the provisions of the Municipality Authorities Act of 1945 in May 1957. 5. Articles of Incorporation for THA have been amended by Harrisburg City Council by way of ordinance from when it was first established in 1957 through its current existence. a. When THA was formed in 1957, it was known as the Harrisburg Sewerage Authority. b. On July 17, 1978, the term of its existence was extended through May 31, 2028. c. On December 1, 1987, the Harrisburg Sewerage Authority was renamed the Harrisburg Water and Sewer Authority. d. On January 23, 1990, the Harrisburg Water and Sewer Authority was renamed The Harrisburg Authority. 6. Articles of Incorporation for THA provide the following: To engage in acquiring, holding, constructing, financing, improving, maintaining and operating, owning and leasing projects of the kind and character contemplated by law for a general purpose authority, as authorized and permitted by, and also as limited by provisions of the Municipality Authorities Act, the Act of May 2, 1945, P.L. 382, as amended or supplemented, and by any other applicable statute or law. 7. The THA Board consists of five Members serving staggered terms. 8. Individuals serving on the THA Board are not compensated. 9. Authority by-laws created the officer positions of Chairman, Vice-Chairman, Secretary, Treasurer, and one or more Assistant Secretary/Treasurer(s). 10. The by-laws of THA effective June 26, 2006, through October 2007, under Article III Officers, identify the functions of the Chairman and Vice-Chairman: Chairman - a. The Chairman shall function as the Chief Executive Officer of the Authority exercising the executive and administrative powers of the Authority. The Chairman shall preside at all meetings of the Authority, and shall submit to the Authority such recommendation and information as the Chairman may consider proper. Except as otherwise authorized by resolution of the Authority, the Chairman shall execute all contracts, deeds, bonds, or other instruments made by the Authority in its name. The Chairman shall appoint all members of committees, established by resolution of the Authority. The Chairman shall notify the Mayor of the City of Keller, 10-045 Page 3 Harrisburg, at least one month in advance, of the expiration of the term of office of any member of the Authority. In addition, the Chairman shall notify the Mayor of the City of Harrisburg of any resignation of a member of the Authority, stating the unexpired term thereof. He shall, in the intervals between meetings, consult with the various officers and employees of the Authority regarding the business of the Authority and perform such other duties as directed by the Authority. 1. On October 4, 2007, the by-laws were amended in that the Chairman was to notify Harrisburg City Council at least one month in advance of the expiration of the term of office of any Member of the Authority and also to notify Harrisburg City Council of any resignation of a Member of the Authority, stating the unexpired term thereof. Vice-Chairman – b. In the absence of the Chairman, the Vice Chairman shall preside at all meetings of the Authority, and in the case of the resignation, death, or inability of the Chairman to perform his duties, the Vice Chairman shall perform the duties of the Chairman and shall perform such other duties as directed by the Authority. 11. On October 24, 2007, the by-laws of THA were amended to make the officer positions gender neutral. a. The Chairman became known as the Chairperson and the Vice Chairman was now identified as Vice Chairperson. 12. Jayme Keller is the son of John Keller. 13. Jayme Keller has been employed on a full-time basis with the Technology Department of Harrisburg University since 2005. a. Jayme Keller is currently the Manager of Technology Services. 14. From approximately July 2002 through September 2007, Jayme Keller had been compensated by THA for performing computer maintenance services. a. Between 2002 and 2006, Jayme Keller, as an individual, provided computer services for THA Board Members and staff. 1. Based on Keller’s recommendation, THA staff began using the services of Jayme Keller. b. THA used the services of Jayme Keller based on the recommendation of his father, THA Board Member John Keller. c. John Keller, as a Member and Vice Chairman of the THA Board, advised the Board that his son was available to provide computer services. d. There was no official Board vote to authorize Jayme Keller to work on THA computers. 15. No other computer maintenance contractors were considered when Jayme Keller performed services for THA between 2002 and 2005. 16. Jayme Keller was compensated by THA for the computer repairs he performed from 2002 through 2005. Keller, 10-045 Page 4 17. In or around the summer of 2006, Jayme Keller established a computer consulting business known as J2 Consulting. a. Jayme Keller is the sole proprietor. 18. Jayme Keller did not register or incorporate J2 Consulting as a business with the Commonwealth of Pennsylvania. a. Jayme Keller performed the functions of J2 Consulting in addition to his full- time employment. 19. In or around the summer/fall of 2006, THA was looking to establish a website to keep the public informed. a. Complaints were made by residents that information about THA could not be viewed online. 20. THA Board Members discussed using J2 Consulting to develop a THA website. a. John Keller participated in Board discussions regarding the use of J2 Consulting. b. THA Board Members were aware that J2 Consulting is owned by Jayme Keller. 21. Minutes of the THA regular meeting for September 27, 2006, reflect THA Board Members approving a motion to award work to J2 Consulting. a. A motion was made by Mr. (Leonard) House, seconded by Mr. (John) Keller, that the Authority engage the services of J2 Consulting at a monthly retainer of $2,500.00 per month beginning October 1, 2006 for computer services. Funding for the professional services will be provided by the Authority’s Administration Account. The motion was unanimously approved. b. The vote to approve the motion was 3-0. Keller was present and participated in the vote. 22. The Board’s decision to utilize J2 Consulting was based in part on the computer repair services that Jayme Keller previously performed on computers utilized by THA Board Members and staff from 2002 through 2005. 23. At the time when the Board voted to award the computer retainer agreement to J2 Consulting, no other businesses were considered. a. The retainer agreement was not advertised nor were quotes sought from other potential vendors. 24. John Keller participated in THA Board actions approving resolutions for the Administrative Operating Expense Budget Accounts for calendar year 2006 on December 21, 2005, and for calendar year 2007 on January 24, 2007. a. The approved resolutions authorized expenditures from THA accounts for different vendors in 2006 and 2007, including J2 Consulting. b. John Keller participated in approving these resolutions while serving as Chairman of the THA Board. Keller, 10-045 Page 5 25. Payments issued by THA from the Administration account require two signatures. a. Board Members and the Executive Director of the Authority had signature authority on the account. b. No stamped signatures were used. 26. Between October 2006 and August 2007, Jayme Keller submitted J2 Consulting invoices to THA that contained explanations of services provided. 27. In 2007, Jayme Keller’s services provided to THA, as J2 Consulting, also included repairs to the computers of THA Board Members, including but not limited to John Keller. 28. Pursuant to the contract approved by the THA Board on September 27, 2006, Jayme Keller, as J2 Consulting, submitted twelve (12) invoices to THA. a. The invoice for August 2007 included expenditures totaling $313.95 for parts that were purchased. 29. Payments were issued to J2 Consulting by THA totaling $30,313.95, from October 2006 through August 2007. a. John Keller signed check numbers 6430, 6456, and 6466 in his capacity as a THA Board Member, totaling $7,500.00. 30. Jayme Keller maintains a joint share account (Account No. xxxx-xx) along with John Keller at the CAT Federal Credit Union. a. The account was established on June 14, 1990. b. John Keller is a joint owner of the account. 31. Payments made to J2 Consulting by THA were deposited by Jayme Keller into the joint share account at the CAT Federal Credit Union. 32. As a result of new Board Members being appointed to THA in or about August 2007, all consulting contracts, including the computer consulting contract THA had with J2 Consulting, were reviewed and considered for termination. a. The THA Board voted on September 5, 2007, to terminate J2 Consulting’s contract effective immediately. 33. Minutes of the September 5, 2007, meeting reflect the following discussions and actions of the THA Board regarding the termination of the J2 Consulting retainer agreement, John Keller’s role in authorizing the contract, and his role in approving payments: Ms. Torres advised that she had spoken with Mr. La Torre to inquire as to the services being provided to the Authority. She advised that she had not been able to get in touch with Jayme Keller of J2 Consulting as of tonight’s meeting. Mr. Papenfuse advised that he wanted to comment on Items L and M that are on today’s agenda. He advised that the services of J2 Consulting and La Torre Communications were being terminated for their services [sic] due to the Authority having tough budget contracts and that the board doesn’t feel that they are in the Authority’s best interests at this time. Keller, 10-045 Page 6 Mr. Papenfuse went on to point out that he is troubled with the J2 Consulting contract because it was revealed that J2 Consulting is actually run and operated by Jayme Keller, son of former Chairman John Keller. He advised that although The Harrisburg Authority does not currently have a policy regarding nepotism, he feels that it seems improper and has the appearance of impropriety. He also notes that Mr. Keller voted for his son’s contract, rather than abstain from the vote and further advised that he believed that feeling that J2 Consulting’s contract may have been terminated, Mr. Keller requested Authority staff to process the payment for the September retainer in advance last week. He would like an investigation into this matter and requested that the most recent payment to J2 Consulting in the amount of $2,500.00 be returned to the Authority. He also pointed out that Jayme Keller is employed by the Harrisburg University and that items regarding the Harrisburg University had previously been voted on by former Chairman John Keller repeatedly without abstaining from the vote. He requested that a clear message be sent to the people of Harrisburg that while nepotism may have been something tolerated in the past on various boards and authorities, it is not something that will be tolerated by this Authority any longer. Mr. Papenfuse advised that he wanted to publicly request that former Chairman John Keller resign from the Authority based specifically on the nepotism issue and the impropriety that has been cast on the dealings of the Authority. Ms. Bryce advised that she voted in favor of terminating these two contracts based on the recommendation by Ms. Torres as to budgetary constraints. She advised that J2 Consulting was not terminated merely because Jayme Keller is Mr. Keller’s son. She advised that while we are under a budgetary crisis, if the Authority is able to have these services provided on a volunteer basis, the Authority should utilize that service. Ms. Bryce, as owner of an IT company, and Mr. Papenfuse, employing IT personnel within his own business, have offered such services to the Authority on a free of charge basis and wanted it on the record that these services will not be neglected. It was also noted that Ms. Torres advised that she was not pleased with the IT services currently being provided to the Authority and that the services need to be improved upon. Ms. Bryce indicated that every effort will be made to improve the IT services and the Authority’s website with volunteers in this time of budgetary crisis. Item M: A motion was made by Ms. Bryce, seconded by Mr. Papenfuse, that the Chairman and/or Special Administrative Board of Directors authorize the Assistant to terminate the contract with J2 Consultants. The motion was unanimously approved. John Keller was not present at the September 5, 2007, special meeting. 34. John Keller, as Chairman and a Member of the THA Board, provided information to McKillip and Torres regarding J2 Consulting. 35. John Keller, as the THA Board Chairman, directed that payment be made for the questioned August 2007, J2 Consulting invoice. a. Keller directed that payment be made to J2 Consulting following the August 24, 2007, Board meeting. 36. On September 10, 2007, Solicitor Foreman, Torres, and McKillip were involved in a series of emails regarding a notice of termination to be sent to J2 Consulting, a request for the return of the September payment, and conflict of interest. Keller, 10-045 Page 7 a. On September 10, 2007, at 2:16 p.m., McKillip forwarded an email to Foreman advising that John Keller (Chairman) had directed that payment be made to J2 Consulting: “The check was actually cut on August 24, 2007 immediately after the Regular 8/22/07 Monthly Meeting at the direction of the Chairman. The check has cleared our account as of 8/27/07.” 37. By correspondence dated September 10, 2007, Jayme Keller was notified by Michele Torres, then Special Administrative Assistant for THA, that effective September 5, 2007, the THA Board of Directors had terminated the J2 Consulting contract. a. Jayme Keller was directed to return any software or equipment in his possession. 38. The primary purpose of J2 Consulting being appointed to provide computer consulting work was to establish and maintain the website for THA. 39. Following the loss of business from THA, in August 2007, Jayme Keller discontinued providing services under the name J2 Consulting. 40. John Keller’s use of the authority of his public position, including participating in THA Board discussions and voting to enter into a retainer agreement with J2 Consulting, resulted in a private pecuniary gain to Jayme Keller. The following findings relate to allegations that John Keller used the authority of his public position to obtain computer equipment and accessories purchased by the THA and retain those items for his personal use, following his THA Board service. 41.In or around 1998 or 1999, THA decided to purchase computer equipment for Board Members that could be utilized and kept at their homes. a. John Keller was a THA Board Member and was in agreement with this practice. b. The purpose of purchasing computer equipment was to eliminate the amount of paperwork the Board Members would have to keep and store at their homes. 42. There were no formal resolutions or motions by the Board approving this practice. a. No formal policy was enacted by the Board regarding the use of the computers by Board Members. 43. The computer equipment was to be utilized by Board Members for THA business. 44. The computer equipment was purchased through THA’s Administration account. a. There was no vote of the Board authorizing purchases of equipment for Board Members. 45. THA’s unwritten practice was that when a Board Member or Senior Staff employee either resigned or was replaced, they were responsible for either returning the equipment or paying for the estimated cost. Keller, 10-045 Page 8 46. John Keller was provided with two laptop computers, one desktop computer, a scanner, and two printers at THA expense between April 1998 and July 2005. 47. John Keller was replaced as a THA Board Member in or around January 2008. 48. On March 13, 2008, John Keller was advised by correspondence from then THA Executive Director Michele Torres, that due to the expiration of his term as a THA Board Member, he was required to return all equipment to THA that was provided to him by March 31, 2008. a. This included all electronic and computer equipment. 49. John Keller was invoiced by the THA Board Chairman on April 18, 2008, for equipment in his possession. a. Attached to Ellison’s letter was an invoice in the amount of $2,445.00 for equipment provided to Keller by THA. b. Payment in the form of a check was requested by May 15, 2008. 50. THA never received any payment from John Keller nor did he ever return the equipment. 51. John Keller received a private pecuniary gain when he retained computers and related equipment purchased by THA. III.DISCUSSION: As a Member of the Board of Directors (“Board”) of The Harrisburg Authority (“THA”) from March 1990 until January 2008, Respondent John Keller, hereinafter also referred to as “Respondent,” “Respondent Keller,” and “Keller,” was a public officialsubject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. The allegations are that Respondent Keller violated Sections 1103(a) and 1105(b) of the Ethics Act: (1) when he used the authority of his public position for the private pecuniary gain of a member of his immediate family and/or a business with which a member of his immediate family is associated by participating in discussions and actions of THA to award contracts valued in excess of $500 to “J2 Consulting,” a business with which his son is associated; (2) when the contracts were entered into with J2 Consulting without an open and public process; (3) when he subsequently participated in actions of THA to approve payments issued to J2 Consulting; and (4) when he used the authority of his public position to obtain computer equipment and accessories purchased by THA and converted these items for his personal use. Per the Consent Agreement, the Investigative Division has exercised its prosecutorial discretion to nol pros allegation(s) under Section 1103(f) of the Ethics Act. Based upon the nol pros, we need not address the Section 1103(f) allegation(s) no longer before us. 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 Keller, 10-045 Page 9 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 1105(b) of the Ethics Act and its subsections detail the financial disclosure that a person required to file the Statement of Financial Interests form must provide. As noted above, the parties have submitted a Consent Agreement and Stipulation of Findings. The parties' Stipulated Findings are set forth above as the Findings of this Commission. We shall now summarize the relevant facts as contained therein. Respondent served as a Member of the THA Board from March 1990 until January 2008. Respondent served as Chairman of the THA Board from 2004 through 2005 and from January 2007 to September 5, 2007. Respondent was removed as Chairman by vote of the THA Board on September 5, 2007. Respondent served as Vice-Chairman of the THA Board from 1999 through 2003 and in 2006. Respondent has a son named Jayme Keller. Since 2005 Jayme Keller has been employed on a full time basis with the Technology Department of Harrisburg University, where he is currently the Manager of Technology Services. From 2002 through 2005, Jayme Keller, as an individual, provided computer services for THA Board Members and staff based upon Respondent’s recommendation. Jayme Keller was compensated by THA for such services. In or around the summer of 2006, Jayme Keller established a computer consulting business known as “J2 Consulting.” Jayme Keller was the sole proprietor. In or around the summer/fall of 2006, THA Board Members discussed using J2 Consulting to develop a THA website. THA Board Members were aware that J2 Keller, 10-045 Page 10 Consulting was owned by Jayme Keller. Respondent participated in Board discussions regarding the use of J2 Consulting. At a THA Board meeting held September 27, 2006, Respondent seconded a motion and participated in the unanimous vote of the Board to engage the services of J2 Consulting at a retainer of $2,500.00 per month beginning October 1, 2006, for computer services, with funding for such services to be provided by the Authority’s Administration Account. The Board’s decision to utilize J2 Consulting was based in part on the computer repair services that Jayme Keller had previously performed on computers utilized by THA Board Members and staff from 2002 through 2005. At the time when the Board voted to award the computer retainer agreement to J2 Consulting, no other businesses were considered. The retainer agreement was not advertised, and quotes were not sought from other potential vendors. Respondent participated in THA Board actions approving resolutions for the Administrative Operating Expense Budget Accounts for calendar year 2006 on December 21, 2005, and for calendar year 2007 on January 24, 2007. The approved resolutions authorized expenditures from THA accounts for vendors including J2 Consulting. Respondent participated in approving these resolutions while serving as Chairman of the THA Board. Payments issued by THA from the Administration account require two signatures. The THA Board Members and Executive Director had signature authority on the account. Pursuant to the contract approved by the THA Board on September 27, 2006, Jayme Keller, as J2 Consulting, submitted twelve invoices to THA. From October 2006 through August 2007, payments totaling $30,313.95 were issued to J2 Consulting by THA. Respondent signed, as an authorized THA signatory, check numbers 6430, 6456 and 6466, totaling $7,500.00. As a result of new Board Members being appointed to THA in or about August 2007, all consulting contracts, including the computer consulting contract THA had with J2 Consulting, were reviewed and considered for termination. On September 5, 2007, the THA Board voted to terminate J2 Consulting’s contract effective immediately. Minutes of the September 5, 2007, meeting reflect discussions of the THA Board regarding Respondent’s role in authorizing the contract and approving payments. THA Board Member Papenfuse (“Papenfuse”) advised that he wanted to publicly request that Respondent resign from THA based specifically on the nepotism issue and the impropriety that had been cast on the dealings of THA. Papenfuse advised that he believed that-- feeling that J2 Consulting’s contract might be terminated--Respondent had requested Authority staff to process the payment for the September retainer in advance. Papenfuse indicated that he would like an investigation into this matter and requested that the most recent payment to J2 Consulting in the amount of $2,500.00 be returned to THA. Respondent was not present at the September 5, 2007, special meeting. The parties have stipulated that Respondent, as THA Chairman, directed that payment be made for the questioned August 2007 J2 Consulting invoice. The Stipulated Findings indicate that the check for the invoice had been cut on August 24, 2007, immediately after the Board’s August 22, 2007, regular monthly meeting, at the direction of Respondent, and that the check had cleared THA’s account as of August 27, 2007. By correspondence dated September 10, 2007, Jayme Keller was notified by Michele Torres, then Special Administrative Assistant for THA, that effective September 5, 2007, the THA Board had terminated the J2 Consulting contract. Following the loss of business from THA, in August 2007, Jayme Keller discontinued providing services under the name J2 Consulting. Keller, 10-045 Page 11 The parties have stipulated that Respondent’s use of the authority of his public position, including participating in THA Board discussions and voting to enter into a retainer agreement with J2 Consulting, resulted in a private pecuniary gain to Jayme Keller. During Respondent’s service on the THA Board, the THA provided computer equipment to Board Members to use and keep at their homes. The computer equipment was to be utilized for THA business. THA’s unwritten practice was that when a Board Member either resigned or was replaced, the Board Member was responsible for either returning the equipment or paying for the estimated cost. Between April 1998 and July 2005, Respondent was provided with two laptop computers, one desktop computer, a scanner and two printers at THA expense. Respondent was replaced as a THA Board Member in or around January 2008. On March 13, 2008, Respondent was advised by correspondence from then THA Executive Director Michele Torres that due to the expiration of Respondent’s term as a THA Board Member, Respondent was required to return all THA equipment by March 31, 2008. This included all electronic and computer equipment. On April 18, 2008, Respondent was invoiced in the amount of $2,445.00 for THA equipment in his possession. Payment in the form of a check was requested by May 15, 2008. THA never received any payment from Respondent. Respondent never returned the aforesaid equipment to THA. The parties have stipulated that Respondent received a private pecuniary gain when he retained computers and related equipment purchased by THA. Having highlighted the Stipulated Findings and issues before us, we shall now apply the Ethics Act to determine the proper disposition of this case. The parties' Consent Agreement sets forth a proposed resolution of the allegations as follows: 3. The Investigative Division will recommend the following in relation to the above allegations: a. That a violation of Section 1103(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. § 1103(a) occurred in relation to Keller’s use of the authority of his public position by participating in discussions and actions of The Harrisburg Authority to award contracts valued in excess of $500 to J2 Consulting, a business with which his son is associated; b. That a violation of Section 1103(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. § 1103(a) occurred in relation to Keller participating in actions of The Harrisburg Authority to approve payments issued to J2 Consulting, including the direction that payment be made for a disputed August 2007 invoice, and when he executed payment checks as the Keller, 10-045 Page 12 Authority signatory, for payment of J2 Consulting invoices; c. That a violation of Section 1103(a) of the Public Official and Employee Ethics Act, 65 Pa.C.S. § 1103(a) occurred in relation to Keller obtaining computer equipment and accessories purchased by The Harrisburg Authority, and retaining these items for his personal use, after his term ended; d. As part of a negotiated settlement agreement, the allegations arising under § 1103(f) of the Public Official and Employee Ethics Act, 65 Pa.C.S. § 1103(f), namely that a violation occurred when Keller, as a Member of the Harrisburg Authority, entered into contracts with J2 Consulting, a business with which he and/or an immediate family member are associated, without an open and public process, are hereby nol prossed; e. All actions by Keller prior to October 2005, relating to Keller’s use of the authority of his public position by participating in discussions and actions of The Harrisburg Authority to award contracts and/or approve payments issued to Jayme Keller and/or J2 Consulting, occurred beyond the five year statute of limitations set forth in section 1108(m) (65 Pa.C.S. § 1108(m)) of the Ethics Act, as interpreted by the Commission. 4. Keller agrees to make payment in the amount of $10,000.00 in settlement of this matter payable to The Harrisburg Authority and forwarded to the Pennsylvania State Ethics Commission within thirty (30) days of the issuance of the final adjudication in this matter. a. The settlement amount of $10,000.00 incorporates payment for any computer equipment retained by Keller, as invoiced by the Harrisburg Authority. 5. Keller agrees to not accept any reimbursement, compensation or other payment from The Harrisburg Authority representing a full or partial reimbursement of the amount paid in settlement of this matter. 6. 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. Keller, 10-045 Page 13 Consent Agreement, at 1-2. In considering the Consent Agreement of the parties, we agree with the parties that a violation of Section 1103(a) of the Ethics Act occurred in relation to Respondent’s use of the authority of his public position by participating in discussions and actions of THA to award contracts valued in excess of $500 to J2 Consulting, a business with which Respondent’s son is associated. I n or around the summer/fall of 2006, THA Board Members discussed using J2 Consulting to develop a THA website. Respondent participated in Board discussions regarding the use of J2 Consulting. At a THA Board meeting held September 27, 2006, Respondent seconded a motion and participated in the unanimous vote of the Board to engage the services of J2 Consulting at a retainer of $2,500.00 per month beginning October 1, 2006, for computer services, with funding for such services to be provided by the Authority’s Administration Account. The parties have stipulated that Respondent’s use of the authority of his public position, including participating in THA Board discussions and voting to enter into a retainer agreement with J2 Consulting, resulted in a private pecuniary gain to Respondent’s son, Jayme Keller. We hold that a violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Respondent’s use of the authority of his public position by participating in discussions and actions of THA to award contracts valued in excess of $500 to J2 Consulting, a business with which Respondent’s son is associated. Cf., Cole, Order 1579. We further agree with the parties that a violation of Section 1103(a) of the Ethics Act occurred in relation to Respondent participating in actions of THA to approve payments issued to J2 Consulting, including the direction that payment be made for a disputed August 2007 invoice, and when he executed payment checks as the THA signatory for payment of J2 Consulting invoices. Cf., Owen, Order 1537; Gold, Order 1461; Vaughn, Order 1450. Respondent used the authority of his public office when he participated in THA Board actions approving resolutions for the Administrative Operating Expense Budget Accounts for calendar year 2006 on December 21, 2005, and for calendar year 2007 on January 24, 2007. The approved resolutions authorized expenditures from THA accounts for vendors including J2 Consulting. Respondent participated in approving these resolutions while serving as Chairman of the THA Board. From October 2006 through August 2007, payments totaling $30,313.95 were issued to J2 Consulting by THA. Respondent signed, as an authorized THA signatory, check numbers 6430, 6456 and 6466, totaling $7,500.00. Respondent, as THA Chairman, directed that payment be made for the questioned August 2007 J2 Consulting invoice. The Stipulated Findings indicate that the check for the invoice had been cut on August 24, 2007, immediately after the Board’s August 22, 2007, regular monthly meeting, at the direction of Respondent, and that the check had cleared THA’s account as of August 27, 2007. Based upon the above, we hold that a violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Respondent participating in actions of THA to approve payments issued to J2 Consulting, including the direction that payment be made Keller, 10-045 Page 14 for a disputed August 2007 invoice, and when he executed payment checks as the THA signatory for payment of J2 Consulting invoices. As for the parties’ recommendation for the finding of a third violation of Section 1103(a), the Stipulated Findings establish that between April 1998 and July 2005, Respondent was provided with two laptop computers, one desktop computer, a scanner and two printers at THA expense. Such equipment was to be utilized for THA business. THA’s unwritten practice was that when a Board Member resigned or was replaced, the Board Member was responsible for either returning the equipment or paying for the estimated cost. Respondent was replaced as a THA Board Member in or around January 2008. Despite being advised by THA to return such equipment or pay for it, Respondent neither returned nor paid for the equipment. The parties have stipulated that Respondent received a private pecuniary gain when he retained computers and related equipment purchased by THA. We hold that a violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Respondent obtaining computer equipment and accessories purchased by THA and retaining these items for his personal use after his term ended. As part of the Consent Agreement, Respondent has agreed to make payment in the amount of $10,000.00 in settlement of this matter payable to The Harrisburg Authority and forwarded to this Commission within thirty (30) days of the issuance of the final adjudication in this matter. The settlement amount of $10,000.00 incorporates payment for any computer equipment retained by Respondent, as invoiced by THA. Respondent has agreed to not accept any reimbursement, compensation or other payment from THA representing a full or partial reimbursement of the amount paid in settlement of this matter. As for the allegation that Respondent violated Section 1105(b) of the Ethics Act, it appears that the Investigative Division in the exercise of its prosecutorial discretion has elected to non pros that particular allegation. We determine that the Consent Agreement submitted by the parties sets forth a proper disposition for this case, based upon our review as reflected in the above analysis and the totality of the facts and circumstances. Accordingly, per the Consent Agreement of the parties, Respondent is directed to make payment in the amount of $10,000.00 payable to The Harrisburg Authority and th forwarded to 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, Respondent is further directed to not accept any reimbursement, compensation or other payment from THA representing a full or partial reimbursement of the amount paid in settlement of this matter. 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 a Member of the Board of Directors (“Board”) of The Harrisburg Authority (“THA”) from March 1990 until January 2008, Respondent John Keller (“Keller”) was a public officialsubject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. Keller, 10-045 Page 15 2. Keller violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when he used the authority of his public position by participating in discussions and actions of THA to award contracts valued in excess of $500 to J2 Consulting, a business with which Keller’s son is associated. 3. A violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Keller participating in actions of THA to approve payments issued to J2 Consulting, including the direction that payment be made for a disputed August 2007 invoice, and when he executed payment checks as the THA signatory for payment of J2 Consulting invoices. 4. A violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Keller obtaining computer equipment and accessories purchased by THA and retaining these items for his personal use after his term ended. In Re: John Keller, : File Docket: 10-045 Respondent : Date Decided: 4/12/12 : Date Mailed: 5/3/12 ORDER NO. 1603 1. As a Member of the Board of Directors (“Board”) of The Harrisburg Authority (“THA”), John Keller (“Keller”) violated Section 1103(a) of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1103(a), when he used the authority of his public position by participating in discussions and actions of THA to award contracts valued in excess of $500 to J2 Consulting, a business with which Keller’s son is associated. 2. A violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Keller participating in actions of THA to approve payments issued to J2 Consulting, including the direction that payment be made for a disputed August 2007 invoice, and when he executed payment checks as the THA signatory for payment of J2 Consulting invoices. 3. A violation of Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), occurred in relation to Keller obtaining computer equipment and accessories purchased by THA and retaining these items for his personal use after his term ended. 4. Per the Consent Agreement of the parties, Keller is directed to make payment in the amount of $10,000.00 payable to The Harrisburg Authority and forwarded to the th Pennsylvania State Ethics Commission by no later than the thirtieth (30) day after the mailing date of this Order. 5. Per the Consent Agreement of the parties, Keller is further directed to not accept any reimbursement, compensation or other payment from THA representing a full or partial reimbursement of the amount paid in settlement of this matter. 6. Compliance with paragraphs 4 and 5 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