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HomeMy WebLinkAbout1637 Fidler In Re: Stanley Fidler, : File Docket: 11-031 Respondent : X-ref: Order No. 1637 : Date Decided: 4/24/14 : Date Mailed: 5/8/14 Before: John J. Bolger, Chair Nicholas A. Colafella, Vice Chair Mark R. Corrigan Roger Nick Kathryn Streeter Lewis Maria Feeley 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 allegation(s). 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 held. The record is complete. I. ALLEGATIONS: That Stanley Fidler, a public official/public employee in his capacity as a Supervisor for Wayne Township, Schuylkill County, violated Section 1103(a) of the State Ethics Act (Act 93 of 1998), 65 Pa.C.S. § 1103(a), when he used the authority of his public position for a private pecuniary benefit of himself and/or a business with which he is associated by participating in discussions and actions of the Board of Supervisors to award contracts for Township paving and road projects at a time when he had a reasonable expectation that his company would be utilized as a subcontractor. II. FINDINGS: A. Stipulations and/or Pleadings 1. The Investigative Division of the State Ethics Commission received a signed, sworn complaint alleging that Stanley Fidler violated provisions of the State Ethics Act (Act 93 of 1998). 2. Upon review of the complaint the Investigative Division initiated a preliminary inquiry on December 12, 2011. 3. The preliminary inquiry was completed within sixty days. Fidler, 11-031 Page 2 4. On February 10, 2012, a letter was forwarded to Stanley Fidler (hereinafter sometimes referred to as “Fidler”) by the Investigative Division of the State Ethics Commission informing him that a complaint against him was received by the Investigative Division and that a full investigation was being commenced. a. Said letter was forwarded by certified mail, no. 7010 1060 0000 3361 2916. b. The domestic return receipt bore the signature of Joan Fidler, with a delivery date of Not Listed. 5. On March 22, 2012, the Investigative Division of the State Ethics Commission filed an application for a ninety day extension of time to complete the investigation. 6. The Commission issued an Order on April 12, 2012, granting the ninety day extension. 7. On September 4, 2012, the Investigative Division of the State Ethics Commission filed an application for a second ninety day extension of time to complete the investigation. 8. The Commission issued an Order on September 24, 2012, granting the ninety day extension. 9. Periodic notice letters were forwarded to Stanley Fidler, c/o Dirk Berger, Esquire, in accordance with the provisions of the Ethics Act advising him of the general status of the investigation. 10. The Investigative Complaint/Findings Report was mailed to the Respondent on February 4, 2013. 11. Stanley Fidler has served on the Wayne Township, Schuylkill County, Board of Supervisors since at least 2007. a. Wayne Township, Schuylkill County (hereinafter sometimes referred to as the “Township”) is a Township of the Second Class, governed by a three (3) Member Board of Supervisors. 12. The Wayne Township Board of Supervisors (hereinafter sometimes referred to as the “Supervisors”) oversees the operations of the Township’s Road Department. a. The Road Department includes three (3) full-time employees and up to four (4) part-time employees. b. The Road Department maintains a small inventory of equipment and materials for general road maintenance and repair. c. Heavy equipment not owned by the Township is either rented or provided by private contractors hired by the Township. 1. Private equipment rental/contracting is under the general supervision of the Roadmaster. 13. Ralph Fidler has been employed as the Wayne Township Roadmaster for approximately the past thirty (30) years (Ralph Fidler is hereinafter sometimes referred to in his capacity as Roadmaster as “Roadmaster Fidler”). a. Roadmaster Fidler’s responsibilities are as follows: Fidler, 11-031 Page 3  Scheduling daily work assignments for the Township road crew.  Identifying minor and major road construction/repair projects to be completed each year.  Preparation of bid specifications for the Township’s annual major road projects.  Supervising all Township road projects, including those utilizing the services of private contractors.  Attending Supervisors’ meetings and briefing the Supervisors as to the status of road projects. 14. Ralph Fidler and Stanley Fidler are not immediate family members as defined under Section 1102 of the Public Official and Employee Ethics Act. 65 Pa.C.S. § 1102. 15. The Supervisors conduct two road inspections each year. a. These semi-annual road inspections are generally held each spring and fall. b. The purpose of these road inspections is to identify Township roads in need of current or future repair and to prioritize repairs based upon available Liquid Fuels funding. The Township funds these repairs with State Liquid Fuels funds. c. Participants in the semi-annual road inspections are generally the Supervisors and Roadmaster Fidler. 16. After the spring road inspection, Roadmaster Fidler identifies which road projects should be completed, based on the Township’s receipt of Liquid Fuels funds. a. Roadmaster Fidler identifies the projects based on the prior fall and spring road inspections, in consultation with the Supervisors. b. Roadmaster Fidler determines the scope of each year’s projects, after receiving information from the Commonwealth, detailing the allocation of the Township’s Liquid Fuels funds for the year. 1. The Township attempts to complete as many projects as possible each year, based on available Liquid Fuels funding. 17. Roadmaster Fidler is responsible for developing the bid specifications for the Township’s annual major road projects. a. Once the bid specifications are drafted, Township Secretary Barbara Moyer is responsible for placing a bid advertisement in the Pottsville Republican Herald Newspaper. b. Roadmaster Fidler is responsible for handling any inquiries regarding the projects from potential bidders. c. The Supervisors will hold a special bid opening meeting for the major road project bids. d. Roadmaster Fidler is responsible for reviewing the bids to ensure compliance with all bid specifications, prior to bid approval by the Supervisors. Fidler, 11-031 Page 4 18. The Supervisors are ultimately responsible for the review and approval of bids awarded for major road projects annually. a. After a major road project bid is awarded, Roadmaster Fidler has daily supervisory responsibility over the project, until completion to the Township’s and PennDOT’s satisfaction. 19. Since 2007, the Township’s major road projects have been awarded to either EJB Paving & Materials (hereinafter sometimes referred to as “EJB”) or Pennsy Supply, Inc. (hereinafter sometimes referred to as “Pennsy” or “Pennsy Supply”). a. Contracts were always awarded by the Supervisors to the lowest responsible bidder. b. Contracts were awarded as follows: Calendar Winning Bid Quote Award Date Award Year Bidder Location 2007 EJB Paving $290,339.60 May 16, BOS* & Materials 2007 meeting 2008 EJB Paving $172,988.90 May 21, BOS meeting & Materials 2009 2009 EJB Paving $279,085.10 April 15, BOS meeting & Materials 2009 2010 Pennsy $234,327.98 June 16, BOS meeting Supply, Inc. 2010 2011 Pennsy $263,947.10 April 20, BOS meeting Supply, Inc. 2011 2012 EJB Paving $159,360.78 May 16, BOS meeting & Materials 2012 * “BOS” is the abbreviation for “Board of Supervisors.” 20. Supervisors’ meeting minutes confirm that during the period from 2007 through and including 2012, Fidler participated in Supervisors’ actions to award EJB and Pennsy contracts for the annual Township major road projects. a. Fidler’s participation included participating in semi-annual road inspections to determine the scope of projects, reviewing bids and awarding contracts to bidders, and authorizing payment of the completed work. 21. The following chronology details discussions and official actions taken by the Wayne Township Board of Supervisors, including Fidler, in identifying, bidding and awarding major Township road projects to Pennsy Supply, Inc. during 2010 and 2011. a. March 27, 2010: “A special meeting was held by the Board of Supervisors for the Spring Road Tour and to conduct any other general business…The following roads are going to be put out for bid or overlay project, Stoyer Hill (North Side), John’s Acres and Kiehner’s Road. Double Seal Project Roads are Bear Creek Road (North Side), Blue Mt. Road (North of 183), Ketner Road and Scheithauer Road (South Side).” Present: Luckenbill, Fidler, Schropp Fidler, 11-031 Page 5 b. April 21, 2010: “The 2010 Road Project for Overlay and Double Seal projects will be advertised for bid opening to be held at a special meeting on June 16, 2010 at 7:00 P.M.” Present: Luckenbill, Fidler, Schropp c. June 16, 2010: Special Meeting: “The Wayne Township Board of Supervisors met in a special session on the above date to open and read aloud bid proposals submitted for the 2010 Liquid Fuels Road Project…The bids were opened and read aloud. The low bidder was Pennsy Supply for the Wearing Course in the amount of $234,327.98. The low bidder for the Double Seal Coat was Hammaker East in the amount of $47,395.83. The bids were reviewed and the award will be made at the regular meeting of the Board of Supervisors at 7:30 p.m.” Bids: Wearing Course Lehigh Asphalt, Tamaqua, PA: $280,219.04 EJB Paving, West Lawn, PA: $243,283.55 Pennsy Supply, Hummelstown, PA: $234,327.98 Landis Deck, Bernville, PA: $249,668.31 Bids: Double Seal Coat Hammaker East, Fayetville, PA: $47,395.83 Asphalt Maintenance, Center Valley, PA: $50,968.38 Present: Luckenbill, Fidler, Schropp d. June 16, 2010: Regular Meeting: “A special meeting was held at 7:00 p.m. to open and read aloud the bids for the 2010 Road Project. A motion was made by Stanley Fidler to award the bid to the low bidder Pennsy Supply for the Wearing Course in the amount of $234,327.98 and the low bidder Hammaker East for the oil & chip project in the amount of $47,395.00. Total cost of the project $281,723.81. The motion was seconded by Mark Schropp with all in favor.” Present: Luckenbill, Fidler, Schropp e. March 16, 2011: “The following roads have been submitted for the 2011 Liquid Fuels Project to be placed out for bid by Roadmaster Ralph Fidler. 1. T-588 Front Street from Luckenbill Road North to Sweet Arrow Lake Road 2. T-674 South Street in Friedensburg from Front Street West to Hickory Street .12 mile. 3. T-975 Chestnut Street in Friedensburg, Front St. to Spruce Street, .16 mile. 4. T-984 Spruce Street in Friedensburg, Chestnut Street to Route 443, .08 mile. 5. T-596 Moon Hill Road, from Route 183 South to Schuylkill Mt. Road .68 mile. 6. T-675 Keihner’s Road, Route 443 South to Route 183, .29 mile. 7. T-980 Fairview Road, Route 443 South, .09 mile 8. T-988 First Avenue, Route 443 South .09 mile by State Farm Insurance Total 2.73 mile of Overlay Fidler, 11-031 Page 6 A motion was made by Stanley Fidler to place the roads out for bid with the bid opening to be held at 7:00 PM on April 20, 2011. The motion was seconded by Mark Schropp with all in favor.” Present: Luckenbill, Fidler, Schropp f. April 20, 2011: Special Meeting: “The Wayne Township Board of Supervisors met in a special session on the above date at 7:00 PM to open and read aloud bid proposals submitted for the 2011 Liquid Fuels Road Project…The bids were opened and read aloud. The low bidder was Pennsy Supply in the amount of $263,947.10. The bids were reviewed and the award to be made at the regular meeting of the Board of Supervisors at 7:30 PM, April 20, 2011.” Bids Meckley’s Limestone: $293,653.38 Landis Deck: $295,750.27 Pennsy Supply: $263,947.10 EJB Paving: $266,117.25 Ronnie Folk Paving: $ 267,590.88 Present: Luckenbill, Fidler, Schropp g. April 20, 2011: Regular Meeting: “A special meeting was held at 7:00PM to open and read aloud the bids submitted for the 2011 Road Project. A motion was made by Stanley Fidler to award the bid to the low bidder Pennsy Supply in the amount of $263,947.10. The motion was seconded by Mark Schropp with all in favor.” Present: Luckenbill, Fidler, Schropp h. June 15, 2011: “Comments: Roadmaster Ralph Fidler commented the 2011 Liquid Fuels Project has been completed. He noted that the shoulder areas of the roadway and line painting will finish the project.” Present: Luckenbill, Schropp Present: Luckenbill, Fidler, Schropp $159,360.78 for the paving project and the low bidder Midland Asphalt in the amount of $64,683.98 for the oil & chip project.” Present: Luckenbill, Fidler, Schropp 22. Fidler, as a Supervisor, participated in official action taken by the Board approving payments to Pennsy, during both 2010 and 2011. a. Payments for work completed by Pennsy were included as part of monthly bill lists prepared by the Township Secretary/Treasurer and submitted to the Supervisors for approval. b. The Supervisors are provided with monthly bill lists for their review the Fidler, 11-031 Page 7 evening of their regular monthly meeting. c. The bill lists are voted on in their entirety, by a single motion. d. Once the bills are approved, payment checks are issued by the Township. 1. Township checks are signed by the Secretary/Treasurer and one (1) Supervisor. 2. Facsimile signature stamps are not utilized. 23. The following chart details payments made by Wayne Township, between 2010 and 2011, to Pennsy for major road projects using Liquid Fuels funds. Date Check Amount Payee Meeting Motion Second Vote Number Date 09/27/10 203 $191,651.23 Pennsy 09/15/10 Fidler Luckenbill 3-0 Supply 07/28/11 204 $267,042.57 Pennsy 07/20/11 Schropp Luckenbill 3-0 Supply a. All checks were signed by Supervisor Larry Luckenbill and Secretary/Treasurer Barbara Moyer. 24. Stanley Fidler, in his official capacity as a Wayne Township Supervisor, regularly participated in the approval of bill lists which included payments to Pennsy Supply, Inc. 25. Wayne Township business records detail Fidler’s participation in the approval of payments issued to Pennsy Supply, Inc., during 2010 and 2011 as follows: Check Meeting Date Number Amount Payee Date Action Vote Pennsy 05/23/10 3948 $319.36 Supply 05/19/10 Motion, Vote 3-0 Pennsy 06/22/10 3991 $207.04 Supply 06/16/10 Motion, Vote 3-0 Pennsy 07/27/10 4055 $528.17 Supply 07/21/10 Second, Vote 3-0 Pennsy 08/24/10 4096 $2,534.37 Supply 08/18/10 Motion, Vote 3-0 Pennsy 09/22/10 4143 $820.29 Supply 09/15/10 Motion, Vote 3-0 Pennsy 09/22/10 4147 $51,653.26 Supply 09/15/10 Motion, Vote 3-0 Pennsy 10/21/10 4182 $3,418.90 Supply 10/13/10 Vote 3-0 $59,481.39 Pennsy 04/21/11 4514 $1,346.04 Supply 04/20/11 Motion, Vote 3-0 Pennsy 05/20/11 4562 $3,320.50 Supply 05/18/11 Motion, Vote 3-0 Pennsy 08/22/11 4727 $3,167.95 Supply 08/17/11 Second, Vote 3-0 Fidler, 11-031 Page 8 Pennsy 09/22/11 4791 $2,392.49 Supply 09/21/11 Vote 3-0 Pennsy 10/18/11 4830 $268.16 Supply 10/12/11 Motion, Vote 3-0 Pennsy 11/21/11 4892 $322.57 Supply 11/16/11 Second, Vote 3-0 $10,817.71 26. In addition to the major road projects, Pennsy Supply, Inc. had additional business dealings with the Township since at least 2007. a. These business dealings included supplying road aggregate and other paving and/or hauling services. b. Roadmaster Fidler was responsible for ordering goods and services sold to the Township by Pennsy, which were not bid as part of annual major road projects. c. Payments for these services were handled in the same manner as other Township payments detailed in previous Findings. 27. Fidler, as a Supervisor, regularly participated in the approval of bill lists which included payments to Pennsy for the purchase of road materials. 28. Pennsy Supply, Inc. uses independent contracted haulers to transport materials as part of major road projects/contracts, in addition to any regular business dealings with the Township. a. Pennsy Supply, Inc. maintains the names of independent haulers which are then sub-divided into zones, or geographical regions, located within Eastern Pennsylvania. b. A Pennsy Supply Inc., Project Foreman determines the number of haulers needed each day for a particular project; those independent haulers are then secured by a company dispatcher. 29. In his capacity as a private citizen, Fidler is 50% owner of Fidler Bros. Const. Co. (hereinafter sometimes referred to as “Fidler Bros.”). a. Fidler operates Fidler Bros. with his brother, Larry L. Fidler. b. Corporate officers for Fidler Bros. are identified as Stanley L. Fidler, President and Larry L. Fidler, Secretary and Vice-President. 30. Articles of Incorporation for Fidler Bros. were filed with the Pennsylvania Department of State on August 14, 1986. a. Fidler Bros. was assigned entity number 933082 by the Pennsylvania Department of State. nd b. The stated corporate address for Fidler Bros. is One Norwegian Plaza, 2 Floor, Pottsville, PA 17901. 31. Fidler Bros. provides commercial and residential excavation, construction, and hauling services in Schuylkill and the surrounding counties. a. Fidler Bros. owns dump trucks, backhoes and other heavy equipment utilized Fidler, 11-031 Page 9 in its business operations. b. Fidler Bros. also provides hauling services as an independent contractor. 32. Fidler Bros. has had a business relationship with Pennsy for more than fifteen (15) years. a. The nature of the business relationship includes Fidler Bros. serving as an independent contract hauler for Pennsy, as well as Pennsy periodically serving as a supplier of materials, principally stone, for Fidler Bros.’ projects. 33. Daily hauling records of Pennsy confirm that Fidler Bros. was utilized as an independent contract hauler on the Township’s major road projects during the 2010 and 2011 calendar years. a. Fidler Bros. did not serve as a sub-contractor or independent contract hauler on the Township’s major road projects awarded to EJB during 2007, 2008, 2009 or 2012. 34. Pennsy utilized trucks from Fidler Bros. on the 2010 Township major road project from August 6, 2010, through August 10, 2010. a. Fidler Bros. was used by Pennsy as an independent contract hauler on an as needed basis. b. Fidler Bros. would be contacted by a Pennsy dispatcher to schedule hauling services on a daily basis or for the duration of a particular project. c. Fidler Bros. was available to Pennsy dispatchers based on Fidler Bros.’ business location within the Township. d. Compensation paid by Pennsy to Fidler Bros. was on a per load basis, according to the weight of the material and distance hauled. e. During calendar year 2010, Fidler Bros. was compensated by Pennsy at a rate of $6.65 per ton hauled while serving as an independent contract hauler on the Township’s major road project. 35. Pennsy’s records confirm that Fidler Bros. was compensated $2,966.03 for hauling materials as part of the 2010 Township major road project from August 6, 2010, through August 10, 2010. a. Fidler Bros. performed other hauling services for Pennsy during the period from August 6, 2010, through August 10, 2010, unrelated to the Township’s major road project. 36. Pennsy utilized trucks from Fidler Bros. on the 2011 Township major road project from June 9, 2011, through June 13, 2011. a. Fidler Bros. was used as an independent contract hauler by Pennsy on an as needed basis. b. Fidler Bros. would be contacted by a Pennsy dispatcher to schedule hauling services on a daily basis or for the duration of a particular project. c. Fidler Bros. was available to Pennsy dispatchers based on Fidler Bros.’ business location within the Township. Fidler, 11-031 Page 10 d. Compensation paid by Pennsy to Fidler Bros. was on a per load basis, according to the weight of the material and distance hauled. e. During calendar year 2011, Fidler Bros. was compensated at a rate of $6.85 per ton hauled while serving as an independent contract hauler on the Township’s major road project. 37. Pennsy’s records confirm Fidler Bros. was compensated $2,892.20 for hauling materials as part of the 2011 Township major road project from June 9, 2011, through June 13, 2011. a. Fidler Bros. performed other hauling services for Pennsy during the period from June 9, 2011, through June 13, 2011, unrelated to the Township’s major road project. 38. As part of the ongoing business relationship between Pennsy and Fidler Bros., Pennsy hired Fidler Bros. as an independent contract hauler on the Township’s major road projects in 2010 and 2011. 39. Fidler and his brother, Larry Fidler, are the only officers of Fidler Bros. a. Fidler and his brother divided the ordinary business income from Fidler Bros. B. Testimony 40. Glenn Ulsh (“Ulsh”) is a former Member and Chairman of the Board of Supervisors of Washington Township, Schuylkill County, having served in that capacity from 2003 to 2009. a. Ulsh has known Respondent Fidler for at least 25 years. b. Ulsh testified that in December 2002, Ulsh and Respondent had a discussion in which Respondent stated that there were other ways to make money through the position of township supervisor in addition to supervisor compensation, specifically by subcontracting with contractors such as Respondent and Mr. Luckenbill did with their dump trucks for Township paving project(s). c. In 2002 or 2003, Ulsh authored a draft of a letter to Respondent expressing dissatisfaction regarding zoning difficulties the fire company where Ulsh served as President (Summit Station Fire Company) experienced in Wayne Township. d. Since December 2006, Ulsh has been selling tools for a company named “Matco Tools.” 1. Ulsh has attempted to sell tools to Fidler Bros. 2. Except for one employee of Fidler Bros. who purchased tool(s) totaling $70.00 from Ulsh in approximately 2007, no one from Fidler Bros. has purchased tools from Ulsh. 3. Ulsh no longer tries to sell tools to Fidler Bros. due to lack of business. Fidler, 11-031 Page 11 41. Nicole Werner (“Werner”) is employed as a Transportation Manager for Pennsy Supply, having served in that capacity for two years. a. Werner has worked for Pennsy Supply for 14 years. b. Werner was previously employed by Pennsy Supply in sales. c. Werner’s duties as a Transportation Manager with Pennsy Supply include responsibility for hired haulers. 1. Pennsy Supply uses hired haulers when Pennsy Supply does not have sufficient trucks of its own to use for a given day. 2. Pennsy Supply chooses haulers from a list based upon their location (proximity to a particular Pennsy Supply quarry), seniority with Pennsy Supply, and contractual arrangement with Pennsy Supply. 3. Pennsy Supply dispatchers contact the independent haulers to do work on certain projects. d. Pennsy Supply compensates independent haulers a per ton rate, which is calculated based in part upon the round-trip time from the Pennsy Supply quarry to the job site and back. e. Pennsy Supply compensates all independent haulers on the list the same rate for the same work. f. Pennsy paid independent contract haulers $6.65 per ton hauled for the Township’s 2010 paving project and $6.85 per ton hauled for the Township’s 2011 paving project. 42. Douglas Keller (“Keller”) is employed by Pennsy Supply as a General Superintendent for Construction, having held that position for three years. a. Keller has been employed by Pennsy Supply for 15 years. b. Prior to becoming a General Superintendent for Construction, Keller was employed as an Assistant General Superintendent with Pennsy Supply. c. Keller supervised the Wayne Township paving job sites in 2010 and 2011. d. Other haulers in addition to Fidler Bros. were used by Pennsy Supply for the Wayne Township paving projects in 2010 and 2011. 43. Ralph Fidler is employed as the Wayne Township Roadmaster. a. Wayne Township road projects are always awarded to the low bidder. 44. Barbara Moyer is employed as the Wayne Township Secretary/Treasurer, having served in that capacity for 20 years. a. The payments to Pennsy Supply for the Wayne Township 2010 and 2011 paving projects did not deviate from Wayne Township’s normal bill payment procedure. 45. Mark Schropp is a Wayne Township Supervisor and held that office in 2010 and 2011. Fidler, 11-031 Page 12 a. To Schropp’s knowledge, the only reason the Wayne Township 2010 and 2011 paving projects were awarded to Pennsy Supply was that it was the low bidder. 46. Stanley L. Fidler (“Respondent”) is a Wayne Township Supervisor, having served in that capacity for approximately 26 years. a. Respondent and his brother own Fidler Bros. b. Fidler Bros. does hauling work for Pennsy Supply. 1. R-3-1 – R-3-5 consists of a “Renewable Trucking Agreement” which is the type of trucking agreement that Fidler Bros. must sign in order to be on the Pennsy Supply list of haulers. 2. The hauling work that Fidler Bros. does for Pennsy Supply is not limited to work on Wayne Township paving projects. 3. Respondent testified that the rates Pennsy Supply pays Fidler Bros. for hauling varies depending upon the distance hauled. c. Fidler Bros. has done hauling work for EJB on only one occasion. d. Respondent testified that R-2-1 – R-2-2 includes computations of the total amounts Fidler Bros. received from Pennsy Supply in the years 2007-2012 for hauling services, and in particular, the following total amounts: (1) in 2008, $223,524.79; (2) in 2010, $95,145.67; (3) in 2011, $178,707.07; and (4) in 2012, $148,029.93. 1. Respondent testified that Fidler Bros. earned more from hauling for Pennsy Supply in 2008--when the Wayne Township paving project was awarded to EJB--than in 2011 when the Wayne Township paving project was awarded to Pennsy Supply. 2. Respondent testified that Fidler Bros. earned more from hauling for Pennsy Supply in 2012--when the Wayne Township paving project was awarded to EJB--than in 2010 when the Wayne Township paving project was awarded to Pennsy Supply. e. In 2010 and 2011, when the Wayne Township major road projects were awarded to Pennsy Supply, Respondent knew that Fidler Bros. was on the list of independent contractors to haul for Pennsy Supply, and Fidler Bros. had been used in the past as an independent hauler on Pennsy Supply projects. f. Respondent testified that he voted to award the Wayne Township 2010 and 2011 paving projects to Pennsy Supply because Pennsy Supply was the lowest responsible bidder. 1. Respondent testified that when he voted to award the Wayne Township 2010 and 2011 paving projects to Pennsy Supply, it never entered his mind that Fidler Bros. could be called as an independent hauler for Pennsy Supply projects. g. Respondent testified that in 2010 and 2011, Fidler Bros. had already received payment for its hauling work on the Wayne Township paving project Fidler, 11-031 Page 13 prior to action by the Township Board of Supervisors to pay Pennsy Supply or the issuance of a check to Pennsy Supply by the Township. h. Fidler Bros. buys stone from Pennsy Supply as well as other suppliers. 1. Respondent testified that Fidler Bros. chooses a stone supplier based upon the price of the stone and the distance to haul it. i. Respondent testified that he does not recall the conversation Ulsh testified to having with Respondent in 2002 (see, Fact Finding 40b). 47. Fred J. Boote (“Boote”) is a certified public accountant. a. Boote conducted an analysis of the estimated net income/profit received by Fidler Bros. from the hauling services it provided to Pennsy Supply for the Wayne Township 2010 and 2011 major road projects. b. After deducting for labor charges and overhead expenses, the estimated net income/profit that Fidler Bros. received from the hauling services it provided to Pennsy Supply for the Wayne Township 2010 major road project was $616.00. c. After deducting for labor charges and overhead expenses, the estimated net income/profit that Fidler Bros. received from the hauling services it provided to Pennsy Supply for the Wayne Township 2011 major road project was $658.00. C. Documents 48. ID-6-1 – ID-6-17 and R-9-1 – R-9-17 consist of copies of the 2010 federal income tax return for Fidler Bros. a. For 2010, Fidler Bros. reported gross receipts or sales of $2,477,241.00 and total deductions of $2,421,910.00, resulting in reported ordinary business income of $55,331.00. 49. ID-6-18 – ID-6-45 and R-10-1 – R-10-28 consist of copies of the 2011 federal income tax return for Fidler Bros. a. For 2011, Fidler Bros. reported gross receipts or sales of $2,418,900.00 and total deductions of $2,506,212.00, resulting in a reported ordinary business loss of $87,312.00. 50. Respondent testified that R-2-1 – R-2-2 includes computations of the total amounts Fidler Bros. received from Pennsy Supply in the years 2007-2012 for hauling services (see, Fact Finding 46 d). a. R-2-1 – R-2-2 indicates that Fidler Bros. received from Pennsy Supply the following total amounts for hauling services in the years indicated: (1) in 2007, $106,891.66; (2) in 2008, $223,524.79; (3) in 2009, $71,514.36; (4) in 2010, $95,145.67; (5) in 2011, $178,707.07; and (6) in 2012, $148,029.93. III. DISCUSSION: As a Supervisor for Wayne Township (“Township”), Schuylkill County, Respondent Stanley Fidler (hereinafter also referred to as “Respondent,” “Respondent Fidler,” and Fidler, 11-031 Page 14 “Fidler”) is a public official subject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. The allegations as set forth in the Investigative Complaint/Findings Report are that Respondent Fidler violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when he used the authority of his public position for a private pecuniary benefit for himself and/or a business with which he is associated by participating in discussions and actions of the Board of Supervisors to award contracts for Township paving and road projects at a time when he had a reasonable expectation that his company would be utilized as a subcontractor. Pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is prohibited from engaging in conduct that constitutes a conflict of interest: § 1103. Restricted activities (a)Conflict of interest.— No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). The term "conflict of interest" is defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 Pa.C.S. § 1102. Section 1103(a) of the Ethics Act prohibits a public official/public employee from using the authority of public office/employment or confidential information received by 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. Per the Pennsylvania Supreme Court’s decision in Kistler v. State Ethics Commission, 610 Pa. 516, 22 A.3d 223 (2011), in order to violate Section 1103(a) of the Ethics Act, a public official/public employee: … must act in such a way as to put his \[office/public position\] to the purpose of obtaining for himself a private pecuniary benefit. Such directed action implies awareness on the part of the \[public official/public employee\] of the potential pecuniary benefit as well as the motivation to obtain that benefit for Fidler, 11-031 Page 15 himself. Kistler, supra, 610 Pa. at 523, 22 A.3d at 227. To violate Section 1103(a) of the Ethics Act, a public official/public employee “must be consciously aware of a private pecuniary benefit for himself, his family, or his business, and then must take action in the form of one or more specific steps to attain that benefit.” Id., 610 Pa. at 528, 22 A.3d at 231. The above statutory definition of the term "conflict" or "conflict of interest" contains two exclusions, referred to herein as the "de minimis exclusion" and the "class/subclass exclusion." The de minimis exclusion precludes a finding of conflict of interest as to an action having a de minimis (insignificant) economic impact. Thus, when a matter that would otherwise constitute a conflict of interest under the Ethics Act would have an insignificant economic impact, a conflict would not exist and Section 1103(a) of the Ethics Act would not be implicated. See, Kolb, Order 1322; Schweinsburg, Order 900. In order for the class/subclass exclusion to apply, two criteria must be met: (1) the affected public official/public employee, immediate family member, or business with which the public official/public employee or immediate family member is associated must be a member of a class consisting of the general public or a true subclass consisting of more than one member; and (2) the public official/public employee, immediate family member, or business with which the public official/public employee or immediate family member is associated must be affected "to the same degree" (in no way differently) than the other members of the class/subclass. 65 Pa.C.S. § 1102; see, Kablack, Opinion 02-003; Rubenstein, Opinion 01-007. The first criterion of the exclusion is satisfied where the members of the proposed subclass are similarly situated as the result of relevant shared characteristics. The second criterion of the exclusion is satisfied where the individual/business in question and the other members of the class/subclass are reasonably affected to the same degree by the proposed action. Kablack, supra. We shall now summarize the relevant facts. Respondent Fidler has served as a Township Supervisor for approximately 26 years. The Township Board of Supervisors consists of three Members. Each year, the Supervisors and Township Roadmaster Ralph Fidler (“Roadmaster Fidler”) conduct road inspections to identify Township roads in need of current or future repair and to prioritize repairs based upon available Liquid Fuels funding. Roadmaster Fidler develops the bid specifications for the Township’s annual major road projects, and a bid advertisement is placed in a local newspaper. The Supervisors hold a special bid opening meeting for the major road project bids. Roadmaster Fidler is responsible for reviewing the bids to ensure compliance with all bid specifications, prior to bid approval by the Supervisors. The Supervisors are ultimately responsible for the review and approval of bids awarded for major road projects. During the relevant time period, the Supervisors always awarded such contracts to the lowest responsible bidder. From 2007 through and including 2012, Respondent participated in: (1) the semi- annual road inspections to determine the scope of projects; (2) the review of bids and award of contracts to bidders; and (3) the authorization of payment for the completed work. In 2007, 2008, 2009, and 2012, the Township’s major road projects were awarded to a bidder named “EJB Paving & Materials” (“EJB”). In 2010 and 2011, the Township’s major road projects (also referred to herein as “paving projects”) were awarded to a bidder named “Pennsy Supply, Inc.” (also referred to herein as “Pennsy” or “Pennsy Supply”). At the June 16, 2010, Regular Meeting of the Township Board of Supervisors, Fidler, 11-031 Page 16 Respondent made the motion and participated in the unanimous vote of the Supervisors to award the bid for the “wearing course” to Pennsy Supply, which had the low bid of $234,327.98. At the April 20, 2011, Regular Meeting of the Township Board of Supervisors, Respondent made the motion and participated in the unanimous vote of the Supervisors to award the bid for the 2011 road project to Pennsy Supply, which had the low bid of $263,947.10. In a private capacity, Respondent is President and 50% owner of a corporation named “Fidler Bros. Const. Co.” (“Fidler Bros.”). Respondent operates Fidler Bros. with his brother, Larry L. Fidler. Fidler Bros. has had a business relationship with Pennsy Supply for more than fifteen years. The nature of the business relationship includes Fidler Bros. serving as an independent contract hauler for Pennsy, as well as Pennsy periodically serving as a supplier of materials--principally stone--for Fidler Bros.’ projects. Pennsy Supply uses independent contract haulers to transport materials for major road projects. The process by which Pennsy Supply selects independent contract haulers to transport materials is as follows. Independent contract haulers enter into trucking agreements with Pennsy Supply in order to be placed on the Pennsy Supply list of haulers. A Pennsy Supply Project Foreman determines the number of haulers needed each day for a particular project. Pennsy Supply chooses independent haulers from the list based upon their location, seniority with Pennsy Supply, and contractual arrangement with Pennsy Supply. Pennsy Supply compensates all independent haulers on the list the same rate for the same work. As part of the ongoing business relationship between Pennsy and Fidler Bros., Pennsy hired Fidler Bros. as an independent contract hauler on the Township’s paving projects in 2010 and 2011. Other haulers in addition to Fidler Bros. were used by Pennsy Supply for the Township paving projects in 2010 and 2011. Pennsy paid independent contract haulers $6.65 per ton hauled for the Township’s 2010 paving project and $6.85 per ton hauled for the Township’s 2011 paving project. Pennsy paid Fidler Bros. a total of $2,966.03 for hauling materials as part of the 2010 Township major road project from August 6, 2010, through August 10, 2010. After deducting for labor charges and overhead expenses, the estimated net income/profit that Fidler Bros. received from the hauling services it provided to Pennsy Supply for the Township 2010 major road project was $616.00. (Fidler Bros. reported on its 2010 federal income tax return gross receipts or sales of $2,477,241.00, total deductions of $2,421,910.00, and ordinary business income of $55,331.00.) Pennsy paid Fidler Bros. a total of $2,892.20 for hauling materials as part of the 2011 Township major road project from June 9, 2011, through June 13, 2011. After deducting for labor charges and overhead expenses, the estimated net income/profit that Fidler Bros. received from the hauling services it provided to Pennsy Supply for the Township 2011 major road project was $658.00. (Fidler Bros. reported on its 2011 federal income tax return gross receipts or sales of $2,418,900.00, total deductions of $2,506,212.00, and a reported ordinary business loss of $87,312.00.) Although all independent contract haulers were paid at the same respective rate per ton for the Township’s 2010 and 2011 paving projects, the record does not indicate the number of tons hauled by other independent contract haulers in comparison to Fidler Bros. or the total amounts paid by Pennsy Supply to other independent contract haulers in comparison to Fidler Bros. Respondent testified that he voted to award the Township 2010 and 2011 paving projects to Pennsy Supply because Pennsy Supply was the lowest responsible bidder. Respondent testified that when he voted to award the Township 2010 and 2011 paving projects to Pennsy Supply, it never entered his mind that Fidler Bros. could be called as an Fidler, 11-031 Page 17 independent hauler for Pennsy Supply projects. However, Respondent acknowledged that in 2010 and 2011 when the Township paving projects were awarded to Pennsy Supply, Respondent knew that Fidler Bros. was on the list of independent contract haulers to haul for Pennsy Supply, and Fidler Bros. had been used in the past as an independent hauler on Pennsy Supply projects. Respondent introduced evidence that Fidler Bros. received from Pennsy Supply the following total amounts for hauling services in the years indicated: (1) in 2007, $106,891.66; (2) in 2008, $223,524.79; (3) in 2009, $71,514.36; (4) in 2010, $95,145.67; (5) in 2011, $178,707.07; and (6) in 2012, $148,029.93. Respondent testified that Fidler Bros. earned more from hauling for Pennsy Supply in 2008--when the Township paving project was awarded to EJB--than in 2011 when the Township paving project was awarded to Pennsy Supply. Respondent testified that Fidler Bros. earned more from hauling for Pennsy Supply in 2012--when the Township paving project was awarded to EJB--than in 2010 when the Township paving project was awarded to Pennsy Supply. Respondent, as a Supervisor, participated in official Board actions approving payments to Pennsy for the 2010 and 2011 paving projects. On September 15, 2010, Respondent made the motion and participated in the unanimous vote of the Supervisors to approve payment to Pennsy Supply in the amount of $191,651.23 for the 2010 paving project. On July 20, 2011, Respondent participated in the unanimous vote of the Supervisors to approve payment to Pennsy Supply in the amount of $267,042.57 for the 2011 paving project. Respondent testified that in 2010 and 2011, Fidler Bros. had already received payment for its hauling work on the Township paving project prior to action by the Township Board of Supervisors to pay Pennsy Supply or the issuance of a check to Pennsy Supply by the Township. Fidler Bros. did not serve as a sub-contractor or independent contract hauler on the Township’s major road projects awarded to EJB in 2007, 2008, 2009 and 2012. Fidler Bros. has done hauling work for EJB on only one occasion. Having summarized the above relevant facts, we must now determine whether the actions of Respondent violated Section 1103(a) of the Ethics Act. As we apply the facts to the allegations, due process requires that we not depart from the allegations. Pennsy v. Department of State, 594 A.2d 845 (Pa. Cmwlth. 1991). A violation of the Ethics Act must be based upon clear and convincing proof. 65 Pa.C.S. § 1108(g). Clear and convincing proof is “so ‘clear, direct, weighty, and convincing as to enable the trier of fact to come to a clear conviction, without hesitance, of the truth of the precise facts in issue.’” In Re: Charles E.D.M., 550 Pa. 595, 601, 708 A.2d 88, 91 (1998) (Citation omitted). In considering the evidence, it is clear that Respondent used the authority of his public office as a Township Supervisor when he participated in discussions or actions of the Township Board of Supervisors to award the Township 2010 and 2011 major road projects/paving projects to Pennsy. At the time Respondent engaged in such conduct, he had a reasonable expectation that Fidler Bros. would be used for hauling work on such Township projects due to the ongoing business relationship between Fidler Bros. and Pennsy. Fidler Bros. received a pecuniary benefit in the amount of $616.00 for its hauling work as to the 2010 major road project/paving project, and a pecuniary benefit in the amount of $658.00 for its hauling work as to the 2011 major road project/paving project, for a combined total profit of $1,274.00 for the two years. However, we conclude that Respondent’s actions had a de minimis economic impact upon Fidler Bros.—particularly in light of Fidler Bros.’ total business in 2010 and 2011 (cf., Bixler v. State Ethics Commission, 847 A.2d 785 (Pa. Cmwlth. 2004))—as well as the Township, which paid low bidder Pennsy without regard to which haulers were used. Fidler, 11-031 Page 18 Based upon the above, we hold that Fidler did not violate Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), by participating in discussions or actions of the Township Board of Supervisors to award to Pennsy contracts for the Township’s 2010 and 2011 major road projects/paving projects, at a time when Respondent had a reasonable expectation that a business with which he is associated, “Fidler Bros. Const. Co.,” would be used as a subcontractor, because Respondent’s actions had a de minimis economic impact. In light of our above holding, there is no need to address other arguments raised by 1 Respondent. Finally, we note that this case is distinguished from Luckenbill, Order 1617, in which we were presented with a Stipulation of Findings and Consent Agreement, approved the Consent Agreement as an overall settlement of that case, and were not presented with the de minimis issue. 1 In addition to raising the de minimis issue, Respondent also argued that: (1) the evidence does not meet the Kistler standard for awareness and motivation on the part of Respondent to use his office for the benefit of himself or his business; (2) Respondent voted to award the major road projects to Pennsy Supply in 2010 and 2011 because Pennsy Supply was the lowest responsible bidder; (3) there is no correlation between the award of Township paving projects to Pennsy in 2010 and 2011, and any direct or indirect private pecuniary gain to Fiddler; (4) Fidler Bros. earned more as an independent contract hauler for Pennsy in 2007, 2008, and 2012--years in which the Township paving project was awarded to EJB as the lowest responsible bidder--than in 2010, when the Township paving project was awarded to Pennsy; (5) Fidler Bros. earned more as an independent contract hauler for Pennsy in 2008--a year in which the Township paving project was awarded to EJB as the lowest responsible bidder--than in 2011, when the Township paving project was awarded to Pennsy; (6) payments made by the Township to Pennsy for the 2010 and 2011 Township major road projects did not trigger or facilitate payments to Fiddler Bros. because Fiddler Bros. had already been paid for its hauling work on those projects; and (7) the class/subclass exclusion is applicable because all of the Pennsy Supply contract haulers including Fidler Bros. were paid the same hauling rate for the Township’s 2010 and 2011 major road projects. Fidler, 11-031 Page 19 IV.CONCLUSIONS OF LAW: 1. As a Supervisor for Wayne Township (“Township”), Schuylkill County, Respondent Stanley Fidler (“Fidler”) is a public official subject to the provisions of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq. 2. Fidler did not violate Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), by participating in discussions or actions of the Township Board of Supervisors to award to Pennsy Supply, Inc., contracts for the Township’s 2010 and 2011 major road projects/paving projects, at a time when Respondent had a reasonable expectation that a business with which he is associated, “Fidler Bros. Const. Co.,” would be used as a subcontractor, because Respondent’s actions had a de minimis economic impact. In Re: Stanley Fidler, : File Docket: 11-031 Respondent : Date Decided: 4/24/14 : Date Mailed: 5/8/14 ORDER NO. 1637 As a Supervisor for Wayne Township (“Township”), Schuylkill County, Respondent Stanley Fidler (“Fidler”) did not violate Section 1103(a) of the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1103(a), by participating in discussions or actions of the Township Board of Supervisors to award to Pennsy Supply, Inc., contracts for the Township’s 2010 and 2011 major road projects/paving projects, at a time when Respondent had a reasonable expectation that a business with which he is associated, “Fidler Bros. Const. Co.,” would be used as a subcontractor, because Respondent’s actions had a de minimis economic impact. BY THE COMMISSION, ___________________________ John J. Bolger, Chair