HomeMy WebLinkAbout1642 Kerrick
In Re: John E. Kerrick, : File Docket: 13-018
Respondent : X-ref: Order No. 1642
: Date Decided: 6/16/14
: Date Mailed: 7/11/14
Before: John J. Bolger, Chair
Nicholas A. Colafella, Vice Chair
Raquel K. Bergen
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 allegations. Upon completion of its investigation, the
Investigative Division issued and served upon Respondent a Findings Report identified as
an “Investigative Complaint.” A Stipulation of Findings and a Consent Agreement 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 E. Kerrick, a public official/public employee in his capacity as \[a\]
Supervisor for Tobyhanna Township, Monroe County, violated \[Sections 1103(a), 1104(a),
1104(d), and 1105(b)\] of the State Ethics Act (Act 93 of 1998) when he used the authority
of his public position as a Township Supervisor to vote to award contracts to Papillon &
Moyer Excavating & Paving, LLC, at a time when Kerrick and/or a business with which
Kerrick is associated, namely John H. Kerrick Builders, Inc., was in a contractual
relationship with Papillon & Moyer Excavating & Paving, LLC to provide heavy equipment
to be utilized by Papillon & Moyer Excavating & Paving, LLC; and when \[he\] filed deficient
Statement of Financial Interests forms by failing to disclose all sources of income; and
when he failed to disclose an address for the 2008 calendar year and failed to disclose any
business interests transferred to any immediate family member or indicate none for
calendar year 2009; and when \[he\] failed to timely file a 2012 Statement of Financial
Interests form.
II.FINDINGS:
1. John E. Kerrick has served as a Member of the Tobyhanna Township Board of
Supervisors since about January 2000.
Kerrick, 13-018
Page 2
a. Kerrick has been employed … by the Township’s Public Works Department
since approximately 1982 and as its full-time Director of Public Works since
2009.
b. Tobyhanna Township is a Second Class Township governed by a five (5)
Member Board of Supervisors.
c. Tobyhanna Township Supervisors receive annual compensation in the
amount of $2,500.00 to serve on the Board of Supervisors.
2. Professionally, Kerrick has personal business interests, including John H. Kerrick
Builder, Inc., Hi-Tech Helicopters, Wagner Forest Products, and Mark Anthony
Salon.
a. Kerrick has a 100% ownership interest in Mark Anthony Salon and Hi-Tech
Helicopters, as reported on Statement of Financial Interests forms he filed
with Tobyhanna Township.
b. Kerrick has approximately a 67% ownership interest in Wagner Forest
Products, as reported on Statement of Financial Interests forms he filed.
c. Kerrick also has approximately a 33% ownership interest in John H. Kerrick
Builder, Inc. as reported on Statement of Financial Interests forms on file
with the Township.
3. Records of the Pennsylvania Department of State, Corporation Bureau confirm that
Articles of Incorporation for John H. Kerrick Builder, Inc. were filed with the
Pennsylvania Department of State on November 15, 1965.
a. Entity number 187868 was assigned to John H. Kerrick Builder, Inc. by the
Pennsylvania Department of State.
b. Original incorporators are identified as John H. Kerrick, Mary E. Kerrick, and
Richard W. Shaffer, each with one share of common stock interest.
1. John H. Kerrick was John E. Kerrick’s father.
c. Current corporate officers are John E. Kerrick, President and Vice President,
and Mary Kerrick, Secretary and Treasurer.
1. The effective dates of these changes are not recorded.
4. John H. Kerrick Builder, Inc. is a construction/contracting business which was
started by John E. Kerrick’s father on or before November 15, 1965.
a. Since at least 2008, John E. Kerrick has been the President of John H.
Kerrick Builder, Inc.
b. Since 2008 John H. Kerrick Builder, Inc. has had two (2) compensated
employees: Randy Kraus and Virginia Heckman.
1. Kraus has been employed as a driver/operator since at least 2008.
2. Heckman provides administrative support and has been with John H.
Kerrick Builder, Inc. since 2011.
Kerrick, 13-018
Page 3
3. Heckman and Kraus were the only individuals who received W-2
Wage & Tax Statements from John H. Kerrick Builder, Inc. during this
time frame.
5. Operationally, Tobyhanna Township generally holds one work session and one
regular meeting, open to the public, each month.
a. In advance of their monthly meetings, Members of the Board of Supervisors
are provided with meeting packets for their review.
b. Meeting packets include materials such as prior meeting minutes requiring
Board approval, bill lists/Treasurer’s reports, agendas, bids, quotes and/or
proposals, and relevant correspondence.
1. Meeting minutes are transcribed using the services of a court reporter.
c. Monthly meeting packets are assembled by clerical staff with input from the
Township Secretary, Township Treasurer, Engineer, Solicitor, and other
Township officials having business before the Board.
6. Tobyhanna Township uses the following process for the routine payment of bills.
a. The Treasurer is responsible for coding all bills to be paid to create a
monthly bill list/Treasurer’s report.
b. The bill list includes all of the bills to be paid for the month, including those
which have been paid between meetings.
1. Bills which are due before the date of the meeting or may have some
discount associated with them are sometimes paid prior to Board
approval as a cost savings measure.
c. Bill lists are provided to Members of the Board of Supervisors as part of their
meeting packets.
1. Bill lists include payments from the General Fund, Sewer Operating
Fund, Capital Contingency Reserve, Capital Reserve Fund, and
Highway Aid Fund.
d. Meeting packets are distributed to Members of the Board of Supervisors
generally on the Friday before their Monday meeting.
e. Bill lists are voted on in their entirety by a single motion and roll call vote of
the Board of Supervisors.
f. The actual bills to be paid are at the meeting \[for review should any
questions be\] raised by the Supervisors or public.
g. Township checks are prepared by the Treasurer and signed by the
Treasurer and one Supervisor.
1. All five (5) Members of the Tobyhanna Township Board of
Supervisors have signature authority on Township financial accounts.
7. Tobyhanna Township did not employ a Manager from approximately 2006 until July
2, 2013.
Kerrick, 13-018
Page 4
a. Phyllis Haase has been employed as the Tobyhanna Township Manager
since July 2, 2013.
1. Haase previously was employed as the Township’s Zoning Officer
from approximately April 8, 2006, until being appointed Manager,
effective July 2, 2013.
b. Between 2006 and July 2013, the day to day operations of the Township
were administered by Supervisor Heidi Pickard, who also held the full-time
position of Township Secretary.
c. During this same time frame, Supervisor John E. Kerrick was also employed
by the Township as its Director of Public Works.
8. Tobyhanna Township owns light-duty equipment for the general care and
maintenance of Township roads.
a. Additional equipment needed is obtained on an as-needed basis from
private contractors.
9. In or about calendar year 2005, the Township received suggestions from FEMA and
PEMA that it should consider soliciting bids for equipment rental for emergency
purposes.
a. The premise behind the suggestions was that the Township could readily
hire private contractors needed to facilitate emergency repairs after major
storms.
b. The Township Engineer was directed by the Board of Supervisors to develop
general bid specifications consistent with PennDOT requirements and
regulations.
1. One of PennDOT’s requirements was that prevailing wages be paid
on certain projects.
c. Complying with PennDOT requirements would ensure that the Township
could use State Liquid Fuels funding to pay for the work.
10. Tobyhanna Township has structured its road department operations to comply with
the recommendations received from FEMA and PEMA.
a. The Township annually solicits equipment rental bids for road projects on an
as-needed basis, not just for emergency situations.
b. By structuring Township road work to utilize private contractors, the
Township limits the number of full-time Public Works Department employees
it needs and limits equipment acquisition and maintenance costs.
11. Since approximately 2008, Tobyhanna Township has utilized the following process
to select a vendor(s) to provide equipment rental services to the Township on an
annual basis.
a. The Tobyhanna Township Engineer is responsible for preparing bid
specifications encompassing anticipated Public Works Department needs.
Kerrick, 13-018
Page 5
b. Bid specifications are developed to be compliant with PennDOT
requirements allowing for the use of State Liquid Fuels funding where
available.
c. A legal advertisement requesting bids is placed in the Pocono Record
newspaper.
1. The Pocono Record newspaper is the local paper used by Tobyhanna
Township for legal notices regarding all Township business.
d. Bid packets were available upon request at the Township Building.
1. The Township maintained information identifying individuals and
businesses which received bid packets.
e. Bidding individuals and/or companies were required to be PennDOT
approved to be allowed to bid on the annual contract.
f. The Township follows a sealed bid process annually for the contract, which
is awarded during a public meeting of the Township Board of Supervisors.
g. The stated contract period was based on the calendar year, commencing
stst
January 1 each year through December 31 of that year.
1. These contracts did not include any options for an additional year(s).
h. Bid specifications required prices for all stated equipment, including required
operator(s), based on both PennDOT prevailing wage guidelines and non-
prevailing wage standards.
1. Bidders were required to submit a bid for all equipment based on a
forty (40) hour work week.
2. Bidders were required to have all equipment listed in the contract
readily available on an as-needed basis.
3. The actual total contract value was open-ended based on the
equipment being used on an as-needed basis.
12. Tobyhanna Township maintained equipment rental bid documents each year
memorializing an open and public bid award process being followed.
a. Bid documents retained by the Township each year included bid
specifications, legal ads, bid packets distributed, bids received, and
correspondence.
13. Tobyhanna Township records maintained for annual equipment rental contracts
included the following bid documents relating to annual equipment rental contracts
since December 2008:
a. Contract Year: 2009
1. Invitation for Bids: Announced Bids due by 12:00 p.m. on December
18, 2008, with a scheduled award date by the Board of Supervisors of
December 19, 2008.
Kerrick, 13-018
Page 6
2. Legal Ad: Ran in the Pocono Record on December 5, 2008, and
December 8, 2008.
3. Bid packets provided to: Locust Ridge Contractors; Randy Hoffman;
Papillon & Moyer Excavating.
4. Bids Received From: Papillon & Moyer Excavating; Locust Ridge
Contractors.
5. Bid Award: December 19, 2008, to Papillon & Moyer Excavating, with
contract signed by John E. Kerrick, Chair, and Heidi Pickard, Vice-
Chair.
6. Bid Award Notification Letter: Sent by Township Secretary Heidi
Pickard to Papillon & Moyer Excavating, dated December 19, 2008,
and requesting a required performance bond in the amount of
$89,499.60.
b. Contract Year: 2010
1. Invitation for Bids: Announced Bids due by 12:00 p.m. on December
18, 2009, with a scheduled award date by the Board of Supervisors of
December 21, 2009.
2. Legal Ad: Ran in the Pocono Record on December 4, 2009, and
December 8, 2009.
3. Bid packets provided to: Locust Ridge Contractors; Robert Ciccone;
Papillon & Moyer Excavating.
4. Bids Received From: Papillon & Moyer Excavating; Locust Ridge
Contractors.
5. Bid Award: December 21, 2009, to Papillon & Moyer Excavating, with
contract signed by John E. Kerrick, Chair, and Heidi Pickard, Vice-
Chair.
6. Bid Award Notification Letter: Sent by Township Secretary Heidi
Pickard to Papillon & Moyer Excavating, dated December 23, 2009,
and requesting a required performance bond in the amount of
$199,938.00.
c. Contract Year: 2011
1. Invitation for Bids: Announced Bids due by 11:00 a.m. on December
17, 2010, with a scheduled award date by the Board of Supervisors of
December 20, 2010.
2. Legal Ad: Ran in the Pocono Record on December 3, 2010, and
December 7, 2010.
3. Bid packets provided to: Locust Ridge Quarry; Alter Inc.; A. Scott
Enterprises, Inc.; Papillon & Moyer Excavating.
4. Bids Received From: Papillon & Moyer Excavating.
Kerrick, 13-018
Page 7
5. Bid Award: December 20, 2010, to Papillon & Moyer Excavating, with
contract signed by John E. Kerrick, Chair, and Heidi Pickard, Vice-
Chair.
6. Bid Award Notification Letter: Sent by Township Secretary Heidi
Pickard to Papillon & Moyer Excavating, dated December 21, 2010,
and requesting a required performance bond in the amount of
$314,372.80.
d. Contract Year: 2012
1. Invitation for Bids: Announced Bids due by 11:00 a.m. on December
19, 2011, with a scheduled award by the Board of Supervisors on
December 21, 2011.
2. Legal Ad: Ran in the Pocono Record on December 5, 2011, and
December 9, 2011.
3. Bid packets provided to: A & R Excavating; Papillon & Moyer
Excavating.
4. Bids Received From: Papillon & Moyer Excavating.
5. Bid Award: December 21, 2011, to Papillon & Moyer Excavating, with
contract signed by John E. Kerrick, Chair, and Heidi Pickard, Vice-
Chair.
6. Bid Award Notification Letter: Sent by Township Secretary Heidi
Pickard to Papillon & Moyer Excavating, dated December 21, 2011,
and requesting a required performance bond in the amount of
$314,372.80.
e. Contract Year: 2013
1. Invitation for Bids: Announced Bids due by 12:00 p.m. on January 7,
2013, with a scheduled award by the Board of Supervisors on
January 7, 2013.
2. Legal Ad: Ran in the Pocono Record on December 14, 2012, and
December 21, 2012.
3. Bid packets provided to: Papillon & Moyer Excavating.
4. Bids Received From: Papillon & Moyer Excavating.
5. Bid Award: January 7, 2013, to Papillon & Moyer Excavating, with
contract signed by John E. Kerrick, Chair, and Heidi Pickard, Vice-
Chair.
6. Bid Award Notification Letter: Sent by Township Secretary Heidi
Pickard to Papillon & Moyer Excavating, dated January 11, 2013, and
requesting a required performance bond in the amount of
$316,838.40.
f. Contract Year: 2014
Kerrick, 13-018
Page 8
1. Invitation for Bids: Announced Bids due by 12:00 p.m. on December
2, 2013, with a scheduled award by the Board of Supervisors on
December 9, 2013.
2. Legal Ad: Ran in the Pocono Record on November 15, 2013, and
November 22, 2013.
3. Bid packets provided to: Papillon & Moyer Excavating; Possinger &
Sons Excavating.
4. Bids Received From: Papillon & Moyer Excavating.
5. Bid Award: December 9, 2013, to Papillon & Moyer Excavating, with
unsigned contract containing signature lines for John E. Kerrick,
Chair, and Heidi Pickard, Vice-Chair.
6. Bid Award Notification Letter: Sent by Township Manager Phyllis
Haase to Papillon & Moyer Excavating, dated December 11, 2013,
and requesting a required performance bond in the amount of
$332,540.40.
14. After contracts were awarded by the Township, the equipment rental contracts were
administered by Kerrick in his capacity as the Township’s Director of Public Works.
a. Kerrick was responsible for identifying the scope of work to be completed.
b. Kerrick maintains that he, the Township Engineer, or the Field
Superintendent was responsible for contacting the vendor who was awarded
the contract, to schedule work as needed.
c. Kerrick was responsible for the initial review of all vendor invoices submitted
to the Township for payment pursuant to the equipment rental contract. The
Township Treasurer would take no action on vendor invoices unless Kerrick
had reviewed and initialed them.
d. Once reviewed by Kerrick, the vendor invoices were given to Township
Treasurer Terri Dougherty to initiate their payment.
1. These payments were processed as part of the Township’s routine
payment of bills.
th
15. Papillon & Moyer Excavating & Paving (“Papillon & Moyer”), 816 North 9 Street,
Stroudsburg, PA 18361 is an excavating, paving and crane service business.
a. David W. Moyer is the President of Papillon & Moyer.
b. David W. Moyer has been the owner of Papillon & Moyer for approximately
the past ten (10) years.
c. Papillon & Moyer operates two (2) business divisions under its corporate
umbrella.
1. The businesses are identified as paving and excavating services as
one business entity and a crane service as the other.
d. David W. Moyer has been in the construction business for approximately the
past thirty-five (35) years.
Kerrick, 13-018
Page 9
16. Papillon & Moyer Excavating has had a business relationship with Tobyhanna
Township since at least 2008.
a. This ongoing business relationship primarily related to equipment rental and
labor provided for the Township’s Public Works Department, under the
supervision of Kerrick as the Township’s Director of Public Works. Kerrick
maintains that the Township Engineer and the Field Superintendent also had
supervisory responsibilities in relation to the equipment rental and labor
contracts.
b. John E. Kerrick also has served on the Township’s Board of Supervisors
throughout this ongoing business relationship.
1. John H. Kerrick Builder, Inc., in which John E. Kerrick had and has a
thirty-three percent (33%) ownership interest, maintained a business
relationship with Papillon & Moyer during the time frame from roughly
2004 or 2005 to 2013.
17. Tobyhanna Township Board of Supervisors meeting minutes reflect that Papillon &
Moyer Excavating has annually been awarded equipment rental contracts with the
Township since the 2009 calendar year.
a. These contracts have been awarded as the result of a sealed bid process
detailed above.
18. From 2008 to 2012, John E. Kerrick participated in the process resulting in Papillon
& Moyer Excavating being selected to perform work for the Tobyhanna Township
Public Works Department. John E. Kerrick’s participation in the overall process
included the following:
a. Voting, along with the other Township Supervisors, in favor of annual
contracts for equipment rental awarded to Papillon & Moyer. Kerrick
maintains that the annual equipment rental contracts were awarded after
they had been reviewed by the Township Engineer and the Township
Solicitor.
b. Reviewing Papillon & Moyer invoices submitted to the Township for
payment, to initiate the invoice approval process.
c. Participating in the review and approval of thirty (30) of the sixty-six (66)
monthly bill lists which included payments to Papillon & Moyer.
d. When checks were presented to him by the Township Secretary or
Treasurer for signature, signing the front side of Township checks issued to
Papillon & Moyer as one of the two (2) required Township Supervisor
signatures, in his official capacity as a Member of the Township Board of
Supervisors.
e. Signing, along with Supervisor Heidi Pickard, bid award/contracts awarded
to Papillon & Moyer Excavating in his official capacity as a Member of the
Township Board of Supervisors, as one of the two (2) required Township
Supervisor signatures.
19. Kerrick participated in actions taken by the Tobyhanna Township Board of
Supervisors to award annual equipment rental contracts to Papillon & Moyer
Excavating for calendar years 2009 through 2013.
Kerrick, 13-018
Page 10
a. Kerrick abstained from action taken by the Tobyhanna Township Board of
Supervisors on December 19, 2013, awarding the equipment rental contract
for the 2014 calendar year to Papillon & Moyer Excavating.
20. Members of the Tobyhanna Township Board of Supervisors were provided with
equipment rental bids documents received prior to taking any official action to
award contracts.
a. Kerrick maintains that he, as one of the Township Supervisors, along with
the Township Engineer and the Township Solicitor, participated in the review
of equipment rental bids for calendar years 2009 through 2013.
b. Kerrick never announced that his personal business, John H. Kerrick
Builder, Inc., had an ongoing business relationship with Papillon & Moyer
Excavating while equipment rental bids submitted by Papillon & Moyer
Excavating were being considered by the Board of Supervisors.
1. Kerrick believed that this longstanding business relationship was
open, obvious, and publicly well known throughout the Township and
was also known by most if not all of the other Township Supervisors.
c. Papillon & Moyer Excavating was the only company that submitted a timely
bid to the Township for the equipment rental contract for calendar years
2011 through 2014.
21. John Kerrick, in his official capacity as a Member of the Tobyhanna Township
Board of Supervisors, participated in the approval of thirty-one (31) of the seventy-
two (72) payments issued to Papillon & Moyer Excavating.
a. Township payments issued to Papillon & Moyer Excavating often times
would be for multiple equipment rental invoices submitted.
22. A summary of Tobyhanna Township Board of Supervisors meeting minutes
including actions by Kerrick reflect the following regarding annual equipment rental
contracts awarded to Papillon & Moyer Excavating since December 19, 2008:
a. Meeting Date: December 19, 2008; Contract Year: 2009; Motion:
Pickard, Second: Lamberton; Yes Votes: Keener, Lamberton, Kerrick,
Pickard; Absent: Moyer.*
b. Meeting Date: December 23, 2009; Contract Year: 2010; Motion:
Pickard, Second: Keener; Yes Votes: Keener, Kerrick, Pickard; Abstain:
Lamberton; Absent: Moyer.*
c. Meeting Date: December 20, 2010; Contract Year: 2011; Motion:
Moyer,* Second: Pickard; Yes Votes: Keener, Moyer,* Kerrick, Pickard;
Abstain: Lamberton.
d. Meeting Date: December 21, 2011; Contract Year: 2012; Motion:
Pickard, Second: Holahan; Yes Votes: Holahan, Moyer,* Kerrick, Pickard;
Abstain: Lamberton.
e. Meeting Date: January 7, 2013; Contract Year: 2013; Motion: Holahan,
Second: Moyer;* Yes Votes: Holahan, Moyer,* Kerrick, Pickard; Abstain:
Lamberton.
Kerrick, 13-018
Page 11
f. Meeting Date: December 19, 2013; Contract Year: 2014; Motion:
Holahan Second: Moyer;* Yes Votes: Holahan, Moyer,* Pickard; Abstain:
Lamberton, Kerrick.
*Note: Township Supervisor Donald Moyer, at asterisks in (a) through (f)
above, should not be confused with David Moyer of Papillon & Moyer.
23. In addition to voting to award annual equipment rental contracts to Papillon & Moyer
Excavating, Kerrick participated in discussions of the Tobyhanna Township Board
of Supervisors regarding the contracts awarded to Papillon & Moyer.
24. Between 2008 and 2013, Kerrick, in his official capacity as the Township’s Director
of Public Works, was responsible for the initial review of Papillon & Moyer
Excavating invoices submitted to the Township for payment, to confirm that the work
invoiced by Papillon & Moyer had in fact been performed.
a. At the time Kerrick was reviewing Papillon & Moyer Excavating invoices, his
company, John H. Kerrick Builder, Inc., had an ongoing business
relationship with Papillon & Moyer.
25. Between August 31, 2009, and June 30, 2013, Kerrick reviewed approximately 106
Papillon & Moyer Excavating invoices submitted to Tobyhanna Township for
payment of work costing the Township approximately $1,253,364.76. Invoices
reviewed by Kerrick by year are as follows:
a. 2009: 11 Invoices, Invoice Costs - $146,476.12; 2010: 36 Invoices, Invoice
Costs - $438,462.14; 2011: 27 Invoices, Invoice Costs - $249,792.55; 2012:
31 Invoices, Invoice Costs - $418,073.95; 2013: 1 Invoice, Invoice Costs -
$560.00.
26. Between June 10, 2008, and December 31, 2013, Tobyhanna Township issued
approximately seventy-two (72) payments totaling approximately $2,176,661.35 to
Papillon & Moyer Excavating. Approximate payments by year are as follows:
a. 2008 - $210,338.17; 2009 - $285,277.48; 2010 - $645,167.09; 2011 -
$290,617.00; 2012 - $596,704.84; 2013 - $148,556.77.
27. Kerrick, in his official capacity as a Member of the Tobyhanna Township Board of
Supervisors, participated along with other Township Supervisors in thirty-one (31)
separate Township Board of Supervisors actions taken approving payments totaling
approximately $1,395,557.81 during calendar years 2009 through 2013. Approvals
by year are as follows:
a. 2009: 4 votes, $39,976.30 in bills approved; 2010: 9 votes, $612,485.84 in
bills approved; 2011: 8 votes, $149,269.67 in bills approved; 2012: 9 votes,
$592,705.80 in bills approved; 2013: 1 vote, $1,120.20 in bills approved.
28. Between June 10, 2008, and June 14, 2011, Kerrick, in his official capacity as a
Member of the Tobyhanna Township Board of Supervisors, signed along with
another Township Supervisor or the Township Treasurer the front side of sixteen
(16) checks which were presented to him by the Township Treasurer or Secretary
for signature, totaling approximately $138,638.22, which were issued to Papillon &
Moyer Excavating. Authorizations by year were as follows:
a. 2008: 3 checks signed, total amount - $14,947.35; 2009: 3 checks signed,
total amount - $12,714.15; 2010: 8 checks signed, total amount -
$106,926.89; 2011: 2 checks signed, total amount - $4,049.83.
Kerrick, 13-018
Page 12
29. During the time frame of 2008 to 2012, when John Kerrick participated in Township
actions to approve contracts with Papillon & Moyer Excavating and voted along with
other Township Supervisors to approve payments to Papillon & Moyer, his private
business, John H. Kerrick Builder, Inc., had an ongoing business relationship with
Papillon & Moyer Excavating.
a. Kerrick believes that this longstanding business relationship was open,
obvious and publicly well known throughout the Township, including by most
if not all of the other Township Supervisors.
b. Kerrick leased vehicles to Papillon & Moyer during this period.
30. Currently John H. Kerrick Builder, Inc. has the following equipment assets as
reported on Federal Income Tax Returns for business expense purposes:
a. Bobcat; F-550 W/Plow; Volvo Dump Truck; Caterpillar Excavator; Caterpillar
Dozer; Trailer.
31. Since at least 2008, Papillon & Moyer Excavating’s business relationship with John
H. Kerrick Builder, Inc. involved the rental of one truck on an as-needed basis.
a. Work performed by John H. Kerrick Builder, Inc. for Papillon & Moyer
Excavating was done as a subcontractor for Papillon & Moyer.
b. The use of a Kerrick truck by Papillon & Moyer Excavating was arranged by
Dispatcher Jeff Farnell.
1. Farnell would call Kerrick and/or his driver, Randy Kraus, to inquire
whether Kerrick’s truck would be available when needed.
2. Papillon & Moyer maintains a list of trucks available for use on
Papillon & Moyer Excavating projects.
32. John H. Kerrick Builder, Inc. business records include daily driver activity logs.
a. These logs document the driver’s name, date, miles traveled, and project(s)
or job site(s) worked.
b. Randy Kraus was John H. Kerrick Builder, Inc.’s driver since at least 2008.
33. John H. Kerrick Builder, Inc. daily driver logs maintained since 2008 do not include
any recorded instances when its equipment was used by Papillon & Moyer
Excavating on Tobyhanna Township projects.
a. John E. Kerrick, in his official capacity as the Township’s Director of Public
Works, scheduled Papillon & Moyer Excavating for Tobyhanna Township
Department of Public Works projects until August 27, 2013.
1. Kerrick maintains that the Township Engineer and the Field
Supervisor also scheduled Papillon & Moyer Excavating for
Tobyhanna Township Department of Public Works projects.
34. From January 2008 through December 2013, Papillon & Moyer Excavating made
payments totaling approximately $570,242.06 to John H. Kerrick Builder, Inc. for
equipment rental on approximately 746 different days, as noted below:
Kerrick, 13-018
Page 13
a. 2013: Invoices – 43, No. of Days – 161, Total Payments - $133,931.26;
2012: Invoices – 41, No. of Days – 152, Total Payments - $123,752.50;
2011: Invoices – 36, No. of Days – 151, Total Payments - $114,860.00;
2010: Invoices – 29, No. of Days – 91, Total Payments - $60,709.50; 2009:
Invoices – 27, No. of Days – 88, Total Payments - $54,969.60; 2008:
Invoices – 31, No. of Days – 103, Total Payments - $82,019.20.
b. Papillon & Moyer’s total payments for 2008 of $84,094.00 (see Fact Finding
37 a) is $2,074.80 higher than John H. Kerrick Builder, Inc. has reported for
the year ($82,019.20). This difference is attributed to two (2) invoices paid
on or about January 1, 2008, from 2007, which combined totaled $2,074.80.
These were invoice numbers 2204 in the amount of $1,383.20 and 2229 in
the amount of $691.60.
35. Papillon & Moyer Excavating issued 208 payments totaling $572,316.85 to John H.
Kerrick Builder, Inc. from 2008 through 2013.
36. Since 2008, payments received from Papillon & Moyer Excavating have accounted
for an average of 27.67% of the annual gross receipts of John H. Kerrick Builder,
Inc.
37. The following chart details the percentage of John H. Kerrick Builder, Inc.’s gross
annual receipts as a result of payments received from Papillon & Moyer:
a. Year JKB Gross Receipts P&M Payments
Percentage
2013 $178,985.25 $133,931.25 74.83%
2012 $239,514.00 $123,752.50 51.67%
2011 $230,877.00 $114,860.00 49.75%
2010 $131,025.00 $ 60,709.50 46.33%
2009 $198,676.00 $ 54,969.60 27.67%
2008 $241,377.00 $ 84,094.00 34.84%
$1,220,454.25 $572,316.85
38. John E. Kerrick did not publically announce the ongoing business relationship his
business, John H. Kerrick Builder, Inc. had with Papillon & Moyer Excavating
between 2008 and 2013, during the same period of time Kerrick was participating in
the Township’s award of Township business to Papillon & Moyer Excavating.
a. Kerrick believed that this longstanding business relationship was open,
obvious, and publicly well known throughout the Township, and was also
known by most if not all of the other Township Supervisors.
39. At no time was the dump truck or driver that John H. Kerrick Builder, Inc. leased to
Papillon & Moyer used in the performance of any Tobyhanna Township work.
40. Effective August 27, 2013, Tobyhanna Township Manager Phyllis Haase
implemented changes in the way the Township conducted business with Papillon &
Moyer in order to eliminate potential conflicts of interest between Papillon & Moyer
and Members of the Board of Supervisors.
a. On or about August 27, 2013, Haase held a meeting with Kerrick at which
the two of them agreed that Kerrick would no longer be the one to initiate
work with Papillon & Moyer.
b. That function was transferred to Haase in her position as Township Manager.
Kerrick, 13-018
Page 14
c. Kerrick and Haase also agreed that Haase would thereafter become
responsible for the initial review of invoices submitted by Papillon & Moyer
for payment to the Township, a task previously performed by Kerrick.
d. Kerrick continued to hold the positions of Township Supervisor and Director
of Public Works but agreed that he would no longer be one of the
Township’s employees who would initiate work with Papillon & Moyer.
e. No changes were made to the manner in which the annual equipment rental
contract was bid.
f. No changes were made to the manner in which the Township processed
invoices submitted by Papillon & Moyer after they were initially reviewed by
Township Manager Haase.
41. At the time Kerrick participated as a Member of the Tobyhanna Township Board of
Supervisors in the award of contracts to Papillon & Moyer, and when he
subsequently voted to approve some of the payments to Papillon & Moyer, Kerrick
was aware that his business was contracting with Papillon & Moyer.
a. Kerrick maintains that he was unaware until August 2013 that this
constituted a violation of the provisions of the Ethics Act.
1. Kerrick maintains that when he learned that his actions might be in
violation of the provisions of the Ethics Act, he immediately ceased
such actions.
b. Kerrick maintains that he was conducting himself in accordance with what he
had been told was proper and legal.
1. In particular, Kerrick maintains that a previous Township Solicitor
advised him that, provided the truck and driver he leased to Papillon
& Moyer were not used to perform Township work, there was nothing
improper or unethical about the leasing arrangement.
2. Kerrick ensured that the John H. Kerrick Builder, Inc. truck and driver
were never used to perform Township work.
3. However, the courts have ruled that acting in good faith on the advice
of the solicitor and other sources is not sufficient cause to absolve
one from penalties of the law. See, Hoak/McCutcheon v. State Ethics
Commission, 466 A.2d 283 (Pa. Commw. 1983); Cotlar v. Warminster
Township, 302 A.2d 859 (Pa. Commw. 1973).
c. Papillon & Moyer is not a party in this proceeding before the State Ethics
Commission.
THE FOLLOWING FINDINGS RELATE TO KERRICK’SFILING OF DEFICIENT
STATEMENT OF FINANCIAL INTERESTS FORMS FOR THE 2008 THROUGH 2011
CALENDAR YEARS.
42. Kerrick, in his official capacity as a Member of the Township Board of Supervisors,
st
is annually required to file a Statement of Financial Interests form by May 1
containing information for the prior calendar year.
43. Tobyhanna Township clerical secretary Margie Argot is responsible for the
distribution and retention of Statement of Financial Interests forms.
Kerrick, 13-018
Page 15
a. Each January, Argot distributes blank Statement of Financial Interests forms
to be filled out by Township officials and select employees.
b. Argot maintains a list of Township officials and employees that she provides
blank Statement of Financial Interests forms to on an annual basis.
c. Completed Statement of Financial Interests forms are returned to Argot’s
attention for retention with other Township records.
44. On August 27, 2013, the following Statement of Financial Interests forms were on
file with Tobyhanna Township for John Kerrick:
a. Calendar Year: 2012; Dated: 03/20/13 on form SEC-1 REV. 01/13 “Received
stamp date of May 1, 2013”; Position: Township Supervisor and Airport
Authority member; Occupation: Director of Public Works; Creditors:
Landmark Community Bank, 4%; Direct/Indirect Income: Tobyhanna
Township, John H. Kerrick Builders, Inc., Hi-Tech Helicopters, Inc.;
Transportation, Lodging, Hospitality: PMI Kalahahari, Value: $5,000.00;
Office, Directorship, or Employment in any business: Wagner Forest
Products, Inc. President; Mark Anthony Salon, Inc., President; Hi-Tech
Helicopters, Inc., President; John H. Kerrick Builder, Inc., President; John
Kerr Inc., President; Financial Interest in any Business: Wagner Forest
Products, Inc. 67%; Mark Anthony Salon, Inc.,100%; Hi-Tech Helicopters,
Inc.,100%; John H. Kerrick Builder, Inc., 33%; All Other Financial Interests:
None.
b. Calendar Year: 2011; Dated: 03/01/12 on form SEC-1 REV. 01/12; Position:
Township Supervisor and Airport Authority member; Occupation: Director of
Public Works; Creditors: Landmark Community Bank, 4%; PNC Bank, 4%;
Direct/Indirect Income: Tobyhanna Township; Office, Directorship, or
Employment in any business: Wagner Forest Products, Inc. President; Hi-
Tech Helicopters, Inc., President; John H. Kerrick Builder, Inc., President;
Financial Interest in any Business: Wagner Forest Products, Inc. 67.8%; Hi-
Tech Helicopters, 100%, John H. Kerrick Builder, 100%; All Other Financial
Interests: None.
c. Calendar Year: 2010; Dated: 03/01/11 on form SEC-1 REV. 01/10, Date
stamped March 2, 2011; Position: Township Supervisor/Supervisor
Candidate and Airport Authority member; Occupation: Director of Public
Works; Creditors: PNC Bank, 4%; Direct/Indirect Income: Tobyhanna
Township; Office, Directorship, or Employment in any business: Wagner
Forest Products, Inc. President; Hi-Tech Helicopters, Inc., President; John H.
Kerrick Builder, Inc., President; Financial Interest in any Business: Wagner
Forest Products, Inc. 67.8%; Hi-Tech Helicopters, 100%, John H. Kerrick
Builder, 100%; All Other Financial Interests: None.
d. Calendar Year: 2009; Dated: 04/29/10 on form SEC-1 REV. 01/10 “Received
stamp date of May 07, 2010”; Position: Township Supervisor; Occupation:
Director of Public Works; Creditors: Landmark Bank, 4%; Direct/Indirect
Income: Tobyhanna Township; Office, Directorship, or Employment in any
business: Wagner Forest Products, Inc.; Hi-Tech Helicopters, Inc.; John H.
Kerrick Builder, Inc.; Financial Interest in any Business: Wagner Forest
Products, Inc.; Hi-Tech Helicopters; John H. Kerrick Builder; All Other
Financial Interests: None.
Kerrick, 13-018
Page 16
e. Calendar Year: 2008; Dated: 04/30/09 on form SEC-1 REV. 01/09; Position:
Township Supervisor; Occupation: Director of Public Works; Creditors:
None; Direct/Indirect Income: Tobyhanna Township; Office, Directorship, or
Employment in any business: Pocono Mountain Regional Police, Vice-Chair;
Financial Interest in any Business: Wagner Forest Products, Inc., President,
2/3%; Hi-Tech Helicopters, President,100%; John H. Kerrick Builder,
President, 100%; All Other Financial Interests: None.
45. Kerrick’s Statement of Financial Interests filed for the 2012 calendar year includes a
date stamp on it of May 1, 2013.
a. The dates on Kerrick’s Statement of Financial Interests filed for the 2012
calendar year are not clear; \[it is not clear from\] the form whether it was
dated 3/20/13 or 5/20/13, due to the upper portion of the first number being
smeared.
1. The only clear date on the form is the May 1, 2013, date stamp,
reflecting a timely filing.
b. Kerrick’s Statement of Financial Interests filed for the 2009 calendar year
was dated April 29, 2010, and date stamped May 7, 2010, reflecting that it
was date stamped six (6) days after the May 1, 2010, filing deadline.
1. Kerrick asserts that he filed this form with the Township prior to the
May 1, 2010, due date and does not know why it did not get stamped
received for almost another week.
2. Kerrick maintains that a Township office employee, and not Kerrick, is
responsible for date stamping the forms.
46. Kerrick failed to complete and/or include a response to Block number 15, Business
Interests Transferred to Immediate Family Member, on Statements of Financial
Interests filed for the 2009 and 2011 calendar years.
a. The Block was left blank on both filings.
b. Kerrick maintains, if completed, the Block would have indicated “none,” as
there were no business interests transferred by Kerrick to an immediate
family member.
47. Kerrick failed to list his address in Block number 2 on his Statement of Financial
Interests filed for the 2008 calendar year.
a. Block number 2, Address, was left blank on this filing.
b. Kerrick’s address for that calendar year, however, was known to the
Township, and was the same as it was on prior and subsequent forms filed
by him with the Township.
48. Kerrick annually received compensation from Tobyhanna Township in the amount of
$2,500.00 for his position as a Township Supervisor.
a. Kerrick simultaneously was receiving compensation from the Township as its
Director of Public Works.
b. The Township annually issued Kerrick one W-2 Wage and Tax Statement
documenting all income he received.
Kerrick, 13-018
Page 17
49. W-2 Wage and Tax Statements on file with the Township document the following
compensation received by Kerrick since 2008. The W-2s include the $2,500.00
received by Kerrick in his position of Township Supervisor.
a. 2008 - $50,895.00; 2009 - $62,200.63; 2010 - $65,123.73; 2011 -
$68,858.10; 2012 - $65,040.44; 2013 - $66,777.35.
50. On February 26, 2014, Kerrick filed amended Statement of Financial Interests forms
with the State Ethics Commission for calendar years 2008 through 2012.
a. Kerrick filed the amended Statement of Financial Interests forms to correct
reporting deficiencies noted in Fact Findings 46 through 49 and to correct
his reported ownership interest in John H. Kerrick Builder, Inc. from 100%
owner to 33% owner.
51. Amended Statement of Financial Interests forms filed by Kerrick on February 26,
2014, for calendar years 2008 through 2012, include the following information:
a. Calendar Year: 2012 (Amended); Dated: 02/26/14 on form SEC-1 REV.
01/13; Position: Township Supervisor, Airport Authority M, Pocono Mt.
Regional Police Member; Occupation: Director of Public Works; Creditors:
Landmark Community Bank, 4%; Direct/Indirect Income: Tobyhanna
Township, John H. Kerrick Builders, Inc., Hi-Tech Helicopters, Inc.;
Transportation, Lodging, Hospitality: PMI Kalahahari, Value: $5,000.00;
Office, Directorship, or Employment in any business: Wagner Forest
Products, Inc. President; Mark Anthony Salon, Inc., President; Hi-Tech
Helicopters, Inc., President; John H. Kerrick Builder, Inc., President; John
Kerr Inc., President; Financial Interest in any Business: Wagner Forest
Products, Inc. 67%; Mark Anthony Salon, Inc.,100%; Hi-Tech Helicopters,
Inc.,100%; John H. Kerrick Builder, Inc., 33%; All Other Financial Interests:
None.
b. Calendar Year: 2011 (Amended); Dated: 02/26/14 on form SEC-1 REV.
01/13; Position: Township Supervisor, Airport Authority M, Pocono Mt.
Regional Police Member; Occupation: Director of Public Works; Creditors:
Landmark Community Bank, 4%; PNC Bank, 4%; Direct/Indirect Income:
Tobyhanna Township; Office, Directorship, or Employment in any business:
Wagner Forest Products, Inc. President; Hi-Tech Helicopters, Inc.,
President; John H. Kerrick Builder, Inc., President; Financial Interest in any
Business: Wagner Forest Products, Inc. 67.8%; Hi-Tech Helicopters, 100%,
John H. Kerrick Builder, 33%; All Other Financial Interests: None.
c. Calendar Year: 2010 (Amended); Dated: 02/26/14 on form SEC-1 REV.
01/13; Position: Township Supervisor/Supervisor Candidate and Airport
Authority Member, Pocono Mt. Regional Police Member; Occupation:
Director of Public Works; Creditors: Landmark Bank, 4%; Direct/Indirect
Income: Tobyhanna Township; Office, Directorship, or Employment in any
business: Wagner Forest Products, Inc. President; Hi-Tech Helicopters, Inc.,
President; John H. Kerrick Builder, Inc., President; Financial Interest in any
Business: Wagner Forest Products, Inc. 67.8%; Hi-Tech Helicopters, 100%,
John H. Kerrick Builder, 33%; All Other Financial Interests: None.
d. Calendar Year: 2009 (Amended); Dated: 02/26/14 on form SEC-1 REV.
01/13; Position: Township Supervisor, Airport Authority M, Pocono Mt.
Regional Police Member; Occupation: Director of Public Works; Creditors:
Landmark Bank, 4%; Direct/Indirect Income: Tobyhanna Township; Office,
Kerrick, 13-018
Page 18
Directorship, or Employment in any business: Wagner Forest Products, Inc.
President; Hi-Tech Helicopters, Inc. President; John H. Kerrick Builder, Inc.
President; Financial Interest in any Business: Wagner Forest Products, Inc.
67%; Hi-Tech Helicopters 100%; John H. Kerrick Builder, Inc. 33%; All Other
Financial Interests: None.
e. Calendar Year: 2008 (Amended); Dated: 02/26/14 on form SEC-1 REV.
01/13; Position: Township Supervisor, Airport Authority M, Pocono Mt.
Regional Police Member; Occupation: Director of Public Works; Creditors:
None; Direct/Indirect Income: Tobyhanna Township; Office, Directorship, or
Employment in any business: Wagner Forest Products, Inc. President; Hi-
Tech Helicopters, Inc. President; John H. Kerrick Builder, Inc. President;
Financial Interest in any Business: Wagner Forest Products, Inc. 67%; Hi-
Tech Helicopters 100%; John H. Kerrick Builder, Inc. 33%; All Other
Financial Interests: None.
52. Kerrick’s Statements of Financial Interests filed for calendar years 2008 through
2011 failed to list John H. Kerrick Builder, Inc. as a source of income.
a. However, the forms do list both John H. Kerrick Builder, Inc. and Hi Tech
Helicopters, Inc. in the category entitled “Office, Directorship or Employment
in Any Business.”
53. Pursuant to Section 1104(d) of the Ethics Act, “\[n\]o public official shall be allowed to
take the oath of office or enter or continue upon his duties, nor shall he receive
compensation from public funds, unless he has filed a statement of financial
interests as required by this chapter.” 65 Pa.C.S. § 1104(d).
a. Kerrick did not have complete and accurate Statements of Financial
Interests filed with the Township for calendar years 2008, 2009, 2010, and
2011.
b. During each calendar year Kerrick did not have a complete and accurate
Statement of Financial Interests filed with the Township, he received
compensation from Tobyhanna Township in the amount of $2,500.00 for his
service as a Township Supervisor, for a total of $10,000.00 during years he
did not file a complete and accurate Statement of Financial Interests.
54. Kerrick was cooperative with the State Ethics Commission’s investigation of this
matter.
III.DISCUSSION:
As a Member of the Tobyhanna Township Board of Supervisors since about
January 2000, Respondent John E. Kerrick, also referred to herein as “Respondent,”
“Respondent Kerrick,” and “Kerrick,” has been a public official subject to the provisions of
the Public Official and Employee Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1101 et seq.
The allegations are that Kerrick violated Sections 1103(a), 1104(a), 1104(d), and
1105(b) of the Ethics Act: (1) when he used the authority of his public position to vote to
award contracts to Papillon & Moyer Excavating & Paving, LLC (“Papillon & Moyer”) at a
time when Kerrick and/or a business with which Kerrick is associated, namely John H.
Kerrick Builder, Inc., was in a contractual relationship with Papillon & Moyer to provide
heavy equipment to be utilized by Papillon & Moyer; (2) when he filed deficient Statement
of Financial Interests (“SFI”) forms by failing to disclose all sources of income; (3) when he
failed to disclose an address for the 2008 calendar year and failed to disclose any
Kerrick, 13-018
Page 19
business interests transferred to any immediate family member or indicate none for
calendar year 2009; and (4) when he failed to timely file a 2012 SFI form.
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.
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 1104(d) of the Ethics Act provides that no public official shall be allowed to
take the oath of office, or enter or continue upon his duties, nor shall he receive
compensation from public funds, unless he has filed an SFI as required by the Ethics Act.
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.
Section 1105(b)(1) of the Ethics Act requires the filer to disclose on the SFI his
name, address, and public position.
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.
Kerrick, 13-018
Page 20
Section 1105(b)(10) of the Ethics Act requires the filer to disclose on the SFI any
financial interest in a business with which he is or has been associated in the preceding
calendar year which has been transferred to a member of his immediate family. The term
“financial interest” is defined in the Ethics Act as “\[a\]ny financial interest in a legal entity
engaged in business for profit which comprises more than 5% of the equity of the business
or more than 5% of the assets of the economic interest in indebtedness.” 65 Pa.C.S. §
1102.
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.
The Township is governed by a five-Member Board of Supervisors (“Board”).
Kerrick has served as a Township Supervisor since about January 2000, and he has been
employed as the Township Director of Public Works since 2009.
Professionally, Kerrick has an ownership interest of approximately 33% in John H.
Kerrick Builder, Inc. (“Kerrick Builder”), a construction/contracting business. Kerrick has
been President of Kerrick Builder since at least 2008.
The Township owns light-duty equipment for the general care and maintenance of
Township roads. Additional equipment is obtained on an as-needed basis from private
contractors. Since approximately 2008, the Township has selected a vendor to provide
equipment rental services to the Township under an annual contract awarded through a
sealed bid process. The equipment rental contract is awarded during a public meeting of
the Board. The actual total contract value is open-ended based on the equipment being
used on an as-needed basis. Vendor invoices submitted pursuant to the equipment rental
contract are processed as part of the Township’s routine payment of bills.
Papillon & Moyer is an excavating, paving and crane service business located in
Stroudsburg, Pennsylvania. Since at least 2008, Papillon & Moyer has had a business
relationship with the Township which is primarily related to equipment rental and labor
provided for the Township Public Works Department. Each year from 2008 through 2013,
the Township placed advertisements in the Pocono Record newspaper soliciting bids for
the following calendar year’s annual equipment rental contract. Papillon & Moyer and one
other business submitted bids for the equipment rental contracts for the 2009 and 2010
calendar years. Papillon & Moyer was the only business to submit timely bids for the
equipment rental contracts for the 2011 through 2014 calendar years.
The Board voted to award the equipment rental contracts for the 2009 through 2014
calendar years to Papillon & Moyer. Kerrick voted in favor of awarding the equipment
rental contracts for the 2009 through 2013 calendar years to Papillon & Moyer, and he
signed contracts with Papillon & Moyer for those calendar years as one of the two required
Township Supervisor signatures. Kerrick abstained from actions taken by the Board which
awarded the 2014 calendar year equipment rental contract to Papillon & Moyer.
Kerrick, in his capacity as the Township Director of Public Works, administered the
equipment rental contract after it was awarded by the Township. Kerrick was responsible
for identifying the scope of work to be completed, and between 2008 and 2013, he was
also responsible for the initial review of Papillon & Moyer invoices submitted to the
Township for payment pursuant to the equipment rental contract. Between August 31,
2009, and June 30, 2013, Kerrick reviewed approximately 106 invoices totaling
approximately $1,253,364.76 that Papillon & Moyer submitted to the Township for
payment. After Kerrick’s review, the invoices were given to the Township Treasurer and
processed as part of the Township’s routine payment of bills.
Kerrick, 13-018
Page 21
Between June 10, 2008, and December 31, 2013, the Township issued
approximately seventy-two payments totaling approximately $2,176,661.35 to Papillon &
Moyer. Township payments issued to Papillon & Moyer were often for multiple equipment
rental invoices submitted by Papillon & Moyer. From 2009 through 2013, Kerrick
participated in thirty-one Board votes that approved Township bill lists including
approximately $1,395,557.81 in payments to Papillon & Moyer. Between June 10, 2008,
and June 14, 2011, Kerrick signed, as an authorized Township signatory, sixteen checks
totaling approximately $138,638.22 which the Township issued to Papillon & Moyer.
During the time frame when Kerrick participated in Board actions to approve
contracts with and payments to Papillon & Moyer, Kerrick Builder had an ongoing business
relationship with Papillon & Moyer. Since at least 2008, Papillon & Moyer’s business
relationship with Kerrick Builder involved the rental of one dump truck and driver on an as-
needed basis. From January 2008 through December 2013, Papillon & Moyer made
payments totaling approximately $570,242.06 to Kerrick Builder for equipment rental on
approximately 746 different days. The dump truck and driver rented by Papillon & Moyer
from Kerrick Builder were never used to perform any work for the Township. Kerrick did
not publically announce the ongoing business relationship that Kerrick Builder had with
Papillon & Moyer during the same period of time he was participating in the award of
Township business to Papillon & Moyer.
Effective August 27, 2013, Township Manager Phyllis Haase (“Haase”) implemented
changes in the way the Township conducted business with Papillon & Moyer in order to
eliminate potential conflicts of interest between Papillon & Moyer and Members of the
Board. Haase and Kerrick agreed that Kerrick would no longer be one of the Township
employees who would initiate work with Papillon & Moyer and that Haase would be
responsible for the initial review of invoices submitted to the Township by Papillon &
Moyer. No changes were made to the manner in which the annual equipment rental
contract was bid or the manner in which the Township processed invoices submitted by
Papillon & Moyer after they were initially reviewed by Haase.
As a Township Supervisor, Kerrick is required to annually file an SFI by May 1
containing information for the prior calendar year. On August 27, 2013, Kerrick had SFIs
for the 2008 through 2012 calendar years on file with the Township. With respect to the
aforesaid SFIs, Kerrick failed to: (1) disclose his address on his SFI for the 2008 calendar
year; (2) complete or include a response to Block number 15 (Business Interests
Transferred to Immediate Family Member) on his SFI for the 2009 calendar year; and (3)
disclose Kerrick Builder as a source of income on his SFIs for the 2008 through 2011
calendar years. Although the date on Kerrick’s SFI for the 2012 calendar year is partially
smeared, the SFI is dated stamped May 1, 2013.
On February 26, 2014, Kerrick filed amended SFI forms for calendar years 2008
through 2012 with this Commission to correct deficiencies on his SFI forms which were on
file with the Township.
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 when, in his capacity as a
Kerrick, 13-018
Page 22
Township Supervisor, Kerrick voted to award
contracts to Papillon & Moyer Excavating &
Paving, LLC, at a time when he and/or a
business with which he is associated, namely
John H. Kerrick Builder, Inc., agreed with
Papillon & Moyer Excavating & Paving, LLC to
lease a dump truck and driver to Papillon &
Moyer Excavating & Paving, LLC.
b. That a violation of Section 1105(b) \[of the Public
Official and Employee Ethics Act, 65 Pa.C.S. §
1105(b),\] occurred when Kerrick failed to
disclose all sources of income on his Statements
of Financial Interests filed for the 2008, 2009,
2010, \[and\] 2011 calendar years, failed to
disclose an address for the 2008 calendar year
\[Statement of Financial Interests\], and failed to
disclose any business interests transferred to
any immediate family member or indicate none
on his Statement of Financial Interests filed for
calendar year 2009.
c. That no violation of Section 1104(a) \[of the
Public Official and Employee Ethics Act, 65
Pa.C.S. § 1104(a),\] occurred in relation to the
allegation that Kerrick failed to timely file a 2012
Statement of Financial Interests form, as it
appears a calendar year 2012 Statement of
Financial Interests form was timely filed.
4. Kerrick agrees to make payment in the amount of $3,000.00 in
settlement of this matter payable to the Commonwealth of
Pennsylvania and forwarded to the Pennsylvania State Ethics
Commission within thirty (30) days of the issuance of the final
adjudication in this matter.
5. To the extent he has not already done so, Kerrick agrees to
file complete and accurate Statements of Financial Interests
with Tobyhanna Township through the Pennsylvania State
Ethics Commission, for the 2008, 2009, 2010, and 2011
calendar years within thirty (30) days of the issuance of the
final adjudication in this matter.
6. Kerrick agrees to not accept any reimbursement,
compensation or other payment from Tobyhanna Township
representing a full or partial reimbursement of the amount paid
in settlement of this matter.
7. 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.
Kerrick, 13-018
Page 23
Consent Agreement, at 2-3.
In considering the Consent Agreement, we accept the recommendation of the
parties for a finding that a violation of Section 1103(a) of the Ethics Act occurred when
Kerrick voted to award contracts to Papillon & Moyer at a time when he and/or a business
with which he is associated, namely Kerrick Builder, agreed with Papillon & Moyer to lease
a dump truck and driver to Papillon & Moyer.
Kerrick Builder is a business with which Kerrick is associated as an owner and an
officer. Since at least 2008, Kerrick Builder had an ongoing business relationship with
Papillon & Moyer that involved the rental of a dump truck and driver to Papillon & Moyer on
an as-needed basis. From January 2008 through December 2013, Papillon & Moyer made
payments totaling approximately $570,242.06 to Kerrick Builder for equipment rental.
During the time that Kerrick Builder was engaged in an ongoing business
relationship with Papillon & Moyer, Kerrick used the authority of his public position as a
Township Supervisor in matters involving Papillon & Moyer: (1) when he voted in favor of
awarding the Township equipment rental contracts for the 2009 through 2013 calendar
years to Papillon & Moyer and signed contracts with Papillon & Moyer for those calendar
years as one of the two required Township Supervisor signatures; (2) when, from 2009
through 2013, he participated in thirty-one Board votes that approved Township bill lists
including approximately $1,395,557.81 in payments to Papillon & Moyer; and (3) when,
between June 10, 2008, and June 14, 2011, he signed, as an authorized Township
signatory, sixteen checks totaling approximately $138,638.22 which the Township issued
to Papillon & Moyer.
Based upon the Stipulated Findings and the Consent Agreement, we hold that
Kerrick violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when, as a
Township Supervisor, he voted to award contracts to Papillon & Moyer at a time when he
and/or a business with which he is associated, namely Kerrick Builder, agreed with
Papillon & Moyer to lease a dump truck and driver to Papillon & Moyer.
We agree with the parties and we hold that a violation of Section 1105(b) of the
Ethics Act, 65 Pa.C.S. § 1105(b), occurred when Kerrick failed to disclose all sources of
income on his SFls filed for the 2008, 2009, 2010, and 2011 calendar years, failed to
disclose an address for the 2008 calendar year SFI, and failed to disclose any business
interests transferred to any immediate family member or indicate none on his SFI filed for
calendar year 2009.
We further hold that no violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. §
1104(a), occurred in relation to the allegation that Kerrick failed to timely file a 2012 SFI
form, as it appears a calendar year 2012 SFI form was timely filed.
It appears that the Investigative Division in the exercise of its prosecutorial
discretion has elected to non pros the portion of the allegations pertaining to Section
1104(d).
As part of the Consent Agreement, Kerrick has agreed to make payment in the
amount of $3,000.00 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.
Kerrick has also agreed to not accept any reimbursement, compensation or other payment
from the Township representing a full or partial reimbursement of the amount paid in
settlement of this matter. To the extent he has not already done so, Kerrick has further
agreed to file complete and accurate SFIs for the 2008, 2009, 2010, and 2011 calendar
years with the Township, through this Commission, within thirty days of the issuance of the
final adjudication in this matter.
Kerrick, 13-018
Page 24
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, Kerrick is directed to make
payment in the amount of $3,000.00 payable to the Commonwealth of Pennsylvania 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, Kerrick is further directed to not accept
any reimbursement, compensation or other payment from the Township representing a full
or partial reimbursement of the amount paid in settlement of this matter.
To the extent he has not already done so, Kerrick is directed to file complete and
accurate SFIs for the 2008, 2009, 2010, and 2011 calendar years with the Township,
th
through this Commission, by no later than the thirtieth (30) day after the mailing date of
this adjudication and Order.
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 Tobyhanna Township (“Township”) Board of Supervisors since
about January 2000, Respondent John E. Kerrick (“Kerrick”) has been a public
official subject to the provisions of the Public Official and Employee Ethics Act
(“Ethics Act”), 65 Pa.C.S. § 1101 et seq.
2. Kerrick violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when, as a
Township Supervisor, he voted to award contracts to Papillon & Moyer Excavating
& Paving, LLC (“Papillon & Moyer”) at a time when he and/or a business with which
he is associated, namely John H. Kerrick Builder, Inc., agreed with Papillon &
Moyer to lease a dump truck and driver to Papillon & Moyer.
3. A violation of Section 1105(b) of the Ethics Act, 65 Pa.C.S. § 1105(b), occurred
when Kerrick failed to disclose all sources of income on his Statements of Financial
Interests (“SFIs”) filed for the 2008, 2009, 2010, and 2011 calendar years, failed to
disclose an address for the 2008 calendar year SFI, and failed to disclose any
business interests transferred to any immediate family member or indicate none on
his SFI filed for calendar year 2009.
4. No violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred in
relation to the allegation that Kerrick failed to timely file a 2012 SFI form, as it
appears a calendar year 2012 SFI form was timely filed.
In Re: John E. Kerrick, : File Docket: 13-018
Respondent : Date Decided: 6/16/14
: Date Mailed: 7/11/14
ORDER NO. 1642
1. As a Member of the Tobyhanna Township (“Township”) Board of Supervisors, John
E. Kerrick (“Kerrick”) violated Section 1103(a) of the Public Official and Employee
Ethics Act (“Ethics Act”), 65 Pa.C.S. § 1103(a), when he voted to award contracts to
Papillon & Moyer Excavating & Paving, LLC (“Papillon & Moyer”) at a time when he
and/or a business with which he is associated, namely John H. Kerrick Builder, Inc.,
agreed with Papillon & Moyer to lease a dump truck and driver to Papillon & Moyer.
2. A violation of Section 1105(b) of the Ethics Act, 65 Pa.C.S. § 1105(b), occurred
when Kerrick failed to disclose all sources of income on his Statements of Financial
Interests (“SFIs”) filed for the 2008, 2009, 2010, and 2011 calendar years, failed to
disclose an address for the 2008 calendar year SFI, and failed to disclose any
business interests transferred to any immediate family member or indicate none on
his SFI filed for calendar year 2009.
3. No violation of Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), occurred in
relation to the allegation that Kerrick failed to timely file a 2012 SFI form, as it
appears a calendar year 2012 SFI form was timely filed.
4. Per the Consent Agreement of the parties, Kerrick is directed to make payment in
the amount of $3,000.00 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.
5. Per the Consent Agreement of the parties, Kerrick is further directed to not accept
any reimbursement, compensation or other payment from the Township
representing a full or partial reimbursement of the amount paid in settlement of this
matter.
6. To the extent he has not already done so, Kerrick is directed to file complete and
accurate SFIs for the 2008, 2009, 2010, and 2011 calendar years with the
Township, through the Pennsylvania State Ethics Commission, by no later than the
th
thirtieth (30) day after the mailing date of this Order.
7. Compliance with paragraphs 4, 5, and 6 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,
___________________________
John J. Bolger, Chair