HomeMy WebLinkAbout849 BitarIn re: Henry J. Bitar
STATE ETHICS COMMISSION
309 FINANCE BUILDING
P.O. BOX 1 1470
HARRISBURG, PA 1 71 08 -1 470
TELEPHONE (717) 783 -1610
: File Docket:
Date Decided:
: Date Mailed:
87 -149 -C
April 23, 1992
April 27, 1992
Before: Dennis C. Harrington,
James M. Howley, Vice
Daneen E. Reese
Roy W. Wilt
Austin M. Lee
Allan M. Kluger
The State Ethics Commission received a complaint regarding a
possible violation of the State Ethics Act, No. 170 of 1978, P.L.
883. Written notice, of the specific allegation(s) was served at
the commencement of the investigation. A Findings Report was
issued and served, upon completion of the investigation, which
constituted the Complaint by the Investigation Division. An Answer
was not filed and a hearing was waived. A Consent Order was
submitted by the parties to the Commission for consideration which
was subsequently approved. This adjudication of the Commission is
hereby issued which sets forth the individual Allegations, Findings
of Fact, Discussion, Conclusions of Law and Order.
Chair
Chair
This adjudication is final and will be made available as a
public document fifteen days after issuance. However,
reconsideration may be requested which will defer public release of
this adjudication pending action on the request by the Commission.
A request for reconsideration, however, does not affect the
finality of this adjudication. A reconsideration request must be
received at this Commission within fifteen days of issuance and
must include a detailed explanation of the reasons as to why
reconsideration should be granted in conformity with 51 Pa. Code
11 2.38.
The files in this case will remain confidential in accordance
with Section 8(a) of Act 170 of 1978 during the fifteen day period
and no one unless the right to challenge this Order is waived, may
violate confidentiality by releasing, discussing or circulating
this Order. However, confidentiality does not preclude discussing
this case with an attorney at law.
Any person who violates confidentiality of the Ethics Act is
guilty of a misdemeanor subject to a fine of not more than $1,000
or imprisonment for not more than one year, 65 P.S. 409(e).
Henry J. Bitar
April 27, 1992
Page 2
I. ALLEGATION:
That, Henry J. Bitar, a New Kensington School Director, and
Westmoreland Intermediate Unit Member, violated Section 3(a) and
Section 3(c) of the State Ethics Act, (Act 170 of 1978), when he
voted to award busing contracts to a firm owned by his wife.
(a) No public official or public
employee shall use his public office of any
confidential information received through his
holding public office to obtain financial gain
other than compensation provided by law for
himself, a member of his immediate family, or
a business with which he is associated. 65
P.S. I403(a)
(c) No public official or public
employee or a member of his immediate family
or any business in which the person or a
member of the person's immediate family is a
director, officer, owner or holder of stock
exceeding 5% of the equity at fair market
value of the business shall enter into any
contract valued at $500 or more with a
governmental body unless the contract has been
awarded through an open and public process,
including prior public notice and subsequent
public disclosure of all proposals considered
and contracts awarded. Any contract made In
violation of this subsection shall be voidable
by a court of competent jurisdiction if the
suit is commenced within 90 days of making .of
the contract. 65 P.S. I403(c)
II. FINDINGS:
1. Henry J. Bitar served as a Director on the New Kensington
Arnold School Board for over thirty years.
a. Bitar served as a Director on the Westmoreland
Intermediate Unit Board (hereinafter referred to as
W.I.U.) from 1971 until he resigned in August, 1990.
1) Bitar served as President of the W.I.U. Board in
1981, 1982, 1983 and 1984.
2 . Rose Marie Bitar, is the registered owner of a transportation
company which has operated under the names of Rose Marie Biter
and /or Ar -Ken.
Henry J. Sitar
April 27, 1992
Page 3
a. This company is located at 933 Third Avenue, New
Kensington, Pennsylvania.
b. A second company known as Bitar's Snack Bar is also
located at the Third Avenue address.
c. Rose Marie Bitar is the spouse of Henry J. Bitar.
3. The W. I.U. contracted with the transportation company known as
Rose Marie Bitar and /or Ar -Ken from the early 1970's through
1990.
a. In 1984, the name of the transportation company changed
from Rose Marie Bitar, to Ar -Ken.
b. The contracts were for the transportation of special
education students.
4. Records of the PA Department of Motor Vehicles show the
following vehicles are registered in Rose Marie Bitar's name:
a. 1987 Chevrolet station wagon.
b. 1978 Chevrolet station wagon.
c. Rose Marie Bitar does not have a Pennsylvania driver's
license.
d. A 1983 Chevrolet Coupe is registered to Henry J. Bitar.
e. The vehicles identified in a and b above were used for
the transportation of the W.I.U. students.
5. The W.I.U. Board Minutes for the years 1979 through 1989 show
that Henry Bitar voted to approve or extend transportation
contracts, between the W.I.U. and the company known as Rose
Marie Sitar and /or Ar -Ken.
a. August 22, 1979: Approved temporary contracts.
Motion by Nabuda, seconded by Rua, to approve temporary
contracts with special education transportation
contractors (including Rose Marie Bitar) until final
contracts can be completed.
Motion carried.
Vote yes: Kraft, Stoner, Hack, Sitar, Branthoover,-
Leeder, Clark, Nabuda, Reidmiller, Rua, Mook.
Henry J. Bitar
April 27, 1992
Page 4
Absent: Stover
b. October 23, 1979: Transportation contracts approved.
Motion by Stoner, seconded by Kraft, to approve special
education transportation contracts for 1979 -80 as
submitted in the amount of $957,060.00 (see exhibit G).
(Included on exhibit G)
Rose Marie Bitar 1 unit $6,660.00
No vote recorded on the above motion.
Present: Bitar, Branthoover, Clark, Hack, Kraft,
Leeder, Mook, Reidmiller, Rua, Stoner,
Sylvester.
Absent: Nabuda, Stover.
c. August 27, 1980: Extend transportation contracts.
Motion by Stoker, seconded by Leeder, to approve
transportation contracts (including Rose Marie Bitar) at
1979 -80 rates until new 1980 -81 contracts are finalized.
Motion carried.
Roll call vote yes: Clark, Leeder, Miller, Mook, Nimick,
Schmidbauer, Sciullo, Stoker, Wisyanski, Bitar.
Absent: Hack, Stouffer
d. November 5, 1980: Approve special education
transportation contracts.
Motion by Miller, seconded by Reidmiller, to approve the
following special education transportation contracts for
1980 -81: (12 contractors are listed).
Rose Bitar $65 cost per day $11,700 cost per year.
Motion carried.
Roll call vote yes: Rua, Schmidbauer, Sciullo, Stouffer,
Sylvester, Bitar, Clark, Leeder, Miller, Mook, Nimick,
Reidmiller.
Absent: Eidemiller, Hack, Kraft, Stoker, Wisyanski
e. November 3, 1981: Approval Transportation Contracts:
Henry J. Bitar
April 27, 1992
Page 5
Absent: Clark, Eidemiller, Pekar, Stoker.
f. October 5, 1982: Approve Resolution Re: Transportation
Contracts.
g -
Motion made by Sylvester, seconded by Stouffer to approve
the following transportation contracts:
(11 contractors were listed)
Rose Marie Bitar $71.00 per day $12,780.00 cost per
year.
Motion carried.
Roll call vote yes: Mook, Nimick, Reidmiller, Rua,
Schmidbauer, Sciullo, Stouffer, Sylvester, Bitar Hack,
Kraft, Leeder, Bukowski.
A motion was made by Leeder, seconded by Schmidbauer, to
adopt the following resolution: Transportation
contractors be paid at last years rates until new
contracts are negotiated. (This included the contract for
Rose Marie Bitar).
Motion carried.
Roll call vote yes: Rosen, Sylvester, Hack, Leeder,
Lucchino, Novak, Reidmiller, Schmidbauer, Valerio, Bitar,
Kraft.
Absent: Eidemiller, Sayers, Sciullo, Stoker, Stouffer,
Weber
November 30, 1982: Approve transportation contracts.
A motion was made by Stoker, seconded by Leeder, to
approve the following transportation contracts for
special education transportation for the 1982 -1983 school
year: (11 contractors are listed).
Rose Marie Bitar
Vehicle - 1; runs -3
Cost per day - $77
Estimated cost per year - $13,860
Motion carried.
Roll call vote yes: Sylvester, Burlack, Hack, Rosen,
Henry J. Bitar
April 27, 1992
Page 6
Leeder, Novak, Reidmiller, Stoker, Stouffer, Weber,
Sitar.
Absent: Kraft, Lucchino, Sayers, Sciullo, Schmidbauer,
Valerio.
h. August 25, 1983: Extend 1982 -83 transportation
contracts.
A motion was made by Reidmiller, seconded by Fraicola, to
extend the 1982 -1983 rates paid transportation providers
into 1983 -1984 until new contracts can be negotiated.
Once rates are determined for the 1983 -1984 school year,
any rate increase or decrease will be made retroactive to
the first day transportation was provided in 1983 -1984.
(This included the Bitar Contract).
Motion carried.
Roll call vote yes: Leeder, Novak, Sciullo, Stouffer,
Swank, Valerio, Bitar, Kraft, Rosen, Reidmiller, Burlack,
Fraicola, Hack.
Absent: Lucchino, Schmidbauer, Sylvester, Wester.
i. October 31, 1983: Transportation contracts and option
for continuance (special education).
A motion was made by Swank, seconded by Sylvester, to
approve the special education programs 1983 -1984
transportation contract and adopt an option for the
continuance of contractual arrangements as follows: (ten
contractors were listed).
Rose Marie Bitar
Vehicle - 1; runs -2
Cost per day - $84.00
Estimated cost per year - $15,120.00
Motion carried.
Roll call vote yes: Leeder, Lucchino, Novak, Sciullo,
Stouffer, Swank, Valerio, Rosen, Sylvester, Reidmiller,
Burlack, Fraicola.
Abstaining: Bitar
Yes - 12, abstention - 1.
Absent: Hack, Kraft, Schmidbauer, Weber
j. August 7, 1984: Extend 1983 -1984 transportation
Henry J. Bitar
April 27, 1992
Page 7
contracts.
A motion was made by Swank, seconded by Leeder, to extend
the 1983 -1984 rates paid transportation providers into
1984 -1985 until new contracts can be negotiated. Once
rates are determined for the 1984 -1985 school year, any
rate increase or decrease will be made retroactive to the
first day transportation was provided in 1984 -1985.
Motion carried.
Roll call voting yes: Kraft, Leeder, Swank, Schmidbauer,
Valerio, Bitar, Stouffer, Rosen, Sylvester, Collodi,
Fraicola, Gera, Harvey.
Absent: Hinkel, Reidmiller, Sciullo, Weber.
k. November 27, 1984: 1984 -1985 bus contracts approved.
A motion was made by Swank, seconded by Collodi, to
approve the following transportation contracts for the
1984 -1985 school year: (12 contractors were listed).
Ar -Ken (Rose Marie Bitar
Vehicles - 2; runs - 4
Cost per day - $178
Estimated cost - $32,040
Motion carried.
Roll call vote yes: Gera, Harvey, Hinkel, Kraft, Leeder,
Sciullo, Swank, Sylvester, Valerio, Weber, Stouffer,
Rosen, Schmidbauer, Reidmiller, Collodi, Fraicola.
Abstaining: Bitar
Yes - 16; abstention - 1.
1. August 27, 1985: Extend 1984 -1985 transportation rates.
A motion was made by Swank, seconded by Hajduk, to extend
the 1984 -1985 rates paid transportation provider into the
1985 -1986 school year until new contracts can be
negotiated. Once rates are determined for the 1985 -1986
school year, any rate increase or decrease shall be made
retroactive to the first day transportation was provided
in 1985 -1986. (This included the contract with Rose Marie
Bitar).
Motion carried.
Henry J. Bitar
April 27, 1992
Page 8
Roll call vote yes: Gera, Hajduk, Hinkel, Kraft, Leeder,
Rua, Swank, Sylvester, Valerio, Weber, Stouffer, Rosen,
Schmidbauer, Harvey, Collodi, Bitar.
Absent: Sciullo.
m. November 26, 1985: Transportation contracts approved
1985 -1986.
A motion was made by Swank, seconded by Sciullo, to
approve transportation contracts for the 1985 -1986 school
year for $1,256,202.00 as presented. (Exhibit D).
Motion carried.
Roll call vote yes: Harvey, Collodi, Bitar, Gera,
Hajduk, Kraft, Leeder, Rua, Sciullo, Swank, Sylvester,
Valerio, Weber, Stouffer, Rosen, Schmidbauer.
Absent: Hinkel.
Exhibit "D" includes 11 contractors for the Westmoreland
Intermediate Unit Transportation - Special Education, 1985-
1986.
Ar -Ken
Vehicles 2 /runs - 3
Cost per day - $184.75
Estimated cost - $33,255.00
n. August 26, 1986: Board extends 1985 -1986
transportation rates.
A motion was made by Hajduk, seconded by Hinkel, to
extend the 1985 -1986 rates paid to transportation
carriers (including Rose Marie Bitar) into the 1986 -1987
school year until new contracts can be negotiated. Once
rates are determined for the 1986 -1987 school year, any
raise or decrease shall be made retroactive to the first
day transportation was provided in 1986 -1987.
Motion carried.
Roll call vote yes: Hinkel, Rosen, Rua, Swank,
Sylvester, Valerio, Weber, Stouffer, Kraft, Schmidbauer,
Harvey, Gera, Hajduk.
Roll call voting no: Leeder
Yes - 13; no - 1.
Absent: Bitar, Collodi, Sciullo.
Henry J. Sitar
April 27, 1992
Page 9
o. November 25, 1986: Transportation contracts approved for
1986 -1987.
A motion was made by Weber, seconded by Sciullo, to
approve transportation contracts for the 1986 -1987 school
year for $1,221,561.00 as presented.
Motion carried.
Roll call vote yes: Bitar, Hajduk, Leeder, Rosen, Rua,
Sciullo, Swank, Sylvester, Valerios, Weber, Stouffer,
Kraft, Schmidbauer, Harvey.
Absent: Collodi, Gera, Hinkel
(Exhibit D) Eleven contractors are included.
Ar -Ken
Vehicles - 2
Cost per day $191.77
Estimated cost - $34,518.60
p. November 24, 1987: 1987 -1988 Special Education Contracts
approved.
A motion was made by Sylvester, seconded by Gera, to
approve special education transportation contracts for
the 1987 -1988 school year as presented.
Motion carried.
Roll call vote yes: Miller, Moore, Rechichar, Rus,
Schmidbauer, Sciullo, Sylvester, Weber, Collodi, Rosen,
Valerio, Stouffer, Hajduk, Gera, Hinkel, Kraft.
Abstaining: Bitar
Yes - 16; abstention - 1.
(Exhibit D) 9 contractors were included, transporting to
49 locations, with 82 vehicles, 12 of which are equipped
with lifts for the non ambulatory children.
Included in the nine contractors was Ar -Ken, with two
vehicles at a cost per day of $110.00 and an estimated
annual term cost of $19,800.00
Note: The total cost for the 1987 -1988 school year
represents a decrease of 1.83% over the total
cost for the 1986 -1987 year.
Henry J. Bitar
April 27, 1992
Page 10
q. November 25, 1988: Special Education Transportation
Contracts approved (1988- 1989).
A motion was made by Hajduk, seconded by Kissell, to
approve special education transportation contracts for
the 1988 -1989 school year as presented.
Motion carried.
Roll call vote yes: Hajduk, Baybrook, Cook, Kern,
Kissell, Miller, Rechichar, Rua, Collodi, Weber,
Valerios, Stouffer.
Voting no: Hinkel
Abstaining: Bitar
Yes - 12; no - 1; abstention - 1.
(Exhibit E) The W.I.U. is presently transporting to 58
locations with eleven contractors and 87 vehicles.
Included in those contractors is Ar -Ken with two vehicles
and an estimated annual term cost of $20,445.90.
r. November 28, 1989: Transportation contracts approved
(Special Education).
A motion was made by Collodi, seconded by Baybrook, to
approve the special education transportation contracts
for the 1989 -90 school year as presented at a cost of
$1,339,862.18.
Motion carried.
Roll call vote yes: Collodi, Cook, Kissell, Kraft,
Miller, Pershing, Rechichar, Rua, Sylvester, Valerio,
Weber, Baybrook, Kern, Hajduk.
Abstaining: Bitar
Yes - 14; no - 0; abstention - 1.
Absent: Hinkel, Moore
(Exhibit E) The W.I.U. is presently transporting to 58
locations, with eleven contractors and 87 vehicles.
Among those contractors is Ar -Ken, with two vehicles at
a cost per day. of $98.99 and an estimated cost of
$20,150.00.
All of the above votes except for two were unanimous.
Sitar's vote was not a deciding vote in any of the
Board's actions regarding the transportation contracts.
Henry J. Bitar
April 27, 1992
Page 11
6. All of the above votes except for two were unanimous.
a. Bitar's vote was not a deciding vote in any of the boards
actions regarding the transportation contracts.
7. W.I.U. Board Solicitor, Attorney David R. Gold, issued an
Opinion Letter on November 19, 1987, regarding contracts for
transportation of school pupils - special education,
specifically referencing Ar -Ken.
Based on the following facts, Gold opined that Henry Bitar
should properly abstain from voting on any issues relating to
the contract with Ar -Ken.
a. Gold had reviewed the proposed contracts for the
transportation of school pupils with nine contractors,
including Ar -Ken.
b. The contracts were negotiated by Thomas Kiliany, Director
of Non Instructional Services.
c. The contractors and the rates of transit were fully
disclosed to the Board and discussed at a public meeting
held November 17, 1987.
d. Henry Bitar informed the Board that Ar -Ken was the name
of a school bus company, solely owned by his wife, Rose
Marie Bitar.
8. Minutes of the W.I.U. Board meetings show that Henry Bitar
abstained on the vote to approve the transportation contracts
after the issuance of Solicitor Gold's Opinion (see #5 P . Q . R . )
9. Henry J. Bitar signed the transportation contracts between the
W.I.U. and Rose Marie Bitar /Ar -Ken during the years when he
was President of the W.I.U. Board of Directors.
a. Date entered into: October 28, 1981
Contractor: Rose Marie Bitar, 933 Third Avenue,
New Kensington
Daily costs: $71.00
Beginning date: August 26, 1981
Termination date: June 30, 1982
Board signatures: Henry J. Biter, President
Warren L. Leeder, Secretary
Date signed: 11/5/81
b. Date entered into: Blank
Contractor: Rose Marie Bitar, New Kensington, PA.
Henry J. Bitar
April 27, 1992
Page 12
Daily cost: $77.00
Beginning date: August 25, 1982
Termination date: June 30, 1983
Board Signatures: Henry J. Bitar, President.
Joel Rosen, Secretary
c. Date entered into: Blank
Contractor: Rose Marie Bitar
Daily cost: $84.00
Beginning Date: August 30, 1983
Termination date: June 30, 1984
Board signatures: Henry J. Bitar, President
Edward M. Schmidbauer, Secretary
d. Date entered into: November 27, 1984
Contractor: Ar -Ken, New Kensington, PA
Rose Marie Bitar, President
Daily cost: $178.00
Beginning date: August 28, 1984
Termination date: June 30, 1985
Board signatures: Henry J. Bitar, President
Helen R. Nelson, Assistant Secretary
10. Records of the W.I.U. include checks issued to the
transportation company known as Rose Marie Bitar and /or Ar -Ken
for contracted services of transporting special education
students. The checks were issued on a monthly basis between
October and June of the following year. Cancelled checks show
that Henry J. Bitar co- endorsed a number of checks on behalf
of Ar-Ken/Rose Marie Bitar issued to Rose Marie Bitar and /or
Ar -Ken between the years 1983/1984 and 1989/1990.
a. 1983 -1984 school year:
Date Check No. Amount
10/4/83 22118 $ 1,540.00
11/4/83 22453 1,820.00
12/1/83 22866 1,680.00
1/6/84 23252 1,680.00
2/2/84 23566 1,680.00
3/5/84 23901 1,680.00
4/3/84 24169 1,680.00
5/3/84 24439 1,680.00
6/5/84 24700 1,680.00
$15,120.00
b. Henry J. Bitar co endorsed all of the above listed checks
with the exception of 12/1/83, check no. 22866.
Henry J. Bitar
April 27, 1992
Page 13
c. 1984 -1985 school years
10/26/84 26014 $ 3,280.00
11/5/84 26032 3,280.00
12/3/84 26393 4,120.00
1/4/85 26761 3,560.00
2/5/85 27043 3,560.00
3/6/85 27346 3,560.00
3/29/85 27643 3,560.00
5/6/85 27991 3,560.00
6/11/85 28601 3,560.00
$32,040.00
d. Henry J. Bitar co- endorsed the above listed checks dated
10/26/84, 3/29/85, 5/6/85 and 6/11/85. All of the above
listed checks were also co- endorsed Ar-Ken and Rose Marie
Sitar.
e. 1985 -1986 school year:
10/1/85 29563 $ 3,560.00
g.
11/1/85 29855 3,560.00
12/3/85 30167 3,965.00
1/2/86 30431 3,695.00
2/3/86 30672 3,695.00
3/6/86 31018 3,695.00
4/2/86 31318 3,695.00
4/29/86 31615 3,695.00
6/11/86 32113 3,695.00
$33,255.00
f. Henry J. Bitar co- endorsed all of the above listed checks
with the exception of 10/1/85. All checks were also co-
endorsed by Ar-Ken, Rose Marie Bitar.
1986 -1987 school year:
10/1/86 32812 $ 3,695.00
11/4/86 33176 3,695.00
12/2/86 33615 4,116.20
1/6/87 33983 3,835.40
1/29/87 34308 3,835.40
3/2/87 34619 3,835.40
4/2/87 34969 3,835.40
6/12/87 35907 3,835.40
30,683.20
h. Henry J. Sitar co- endorsed all of the above listed
Henry J. Sitar
April 27, 1992
Page 14
checks. All the above checks were also co- endorsed by
Ar-Ken, Rose Marie Bitar.
i. 1987 -1988 school year:
10/7/87 33681 $ 3,668.32
1/7/88 37712 632.74
2/5/88 38025 2,200.00
3/8/88 38540 2,200.00
4/6/88 38937 2,310.00
5/20/88 39392 2,090.00
6/7/88 39686 2,310.00
15,411.06
. Henry J. Bitar co- endorsed all of the above listed
checks. All checks were also co- endorsed by Ar-Ken, Rose
Marie Bitar.
k. 1988 -1989 school year:
10/6/88 1653 $ 2,200.00
11/7/88 1994 2,200.00
12/8/88 2362 2,415.28
1/5/89 2726 2,271.77
2/8/89 3026 2,271.77
3/7/89 3382 2,271.77
4/6/89 3729 2,271.77
6/8/89 4337 2,271.77
5/8/89 4045 2,271.77
20,445.90
1. Henry J. Sitar co- endorsed all of the above listed
checks. All checks were also co- endorsed by Ar-Ken, Rose
Marie Sitar.
m. 1989 -1990 school year:
11/8/89 5700 $ 2,200.00
12/7/89 6125 2,316.72
1/8/90 6459 2,238.88
2/8/90 6784 2,238.88
3/8/90 7180 2,238.88
4/9/90 7540 2,238.88
5/8/90 7848 2,238.88
6/7/90 8178 2,238.88
$17,950.00
n. Henry J. Bitar co- endorsed all of the above listed
checks. All of the above listed checks were also co-
endorsed by Ar-Ken, Rose Marie Bitar.
Henry J. Bitar
April 27, 1992
Page 15
11. Checks for the 1983 -1984 school year are issued to Rose Marie
Bitar, 933 Third Avenue, New Kensington, Pennsylvania.
a. Checks for the school years 1984 -1985 through and
including 1989 -1990, are issued to Ar -Ken, at the same
address.
12. Various checks issued to Rose Marie Bitar in 1983 -1984, and
Ar -Ken in 1984 -1985, also reflect the signature of Henry J.
Bitar, as President of the W.I.U. Board, the payor.
13. Henry Bitar's name appears on various documents for the
transportation entity.
14. Certificates of insurance provided to the W.I.U. on behalf of
Rose Marie Bitar, a transportation carrier show the following:
a. 1980 through 1985 - coverage was provided by National
Indemnity Company, 3024 Harney Street, Omaha, Nebraska.
1) 1980 through 1984 - Henry J. Bitar, 299 Charles
Avenue, New Kensington, is listed as the insured.
2) Bitar's description of work is listed as a school
bus driver.
3) The policy covers a 1978 Chevy Caprice Station
Wagon number 1N35L85103309.
4) The coverage provided is described as automobile
liability.
5) Rose Marie Bitar is listed as the insured on the
policies for 1985 -1986 and 1986 -1987.
b. 1986 through 1989 - coverage was provided through Liberty
Mutual.
1) The insured is listed as Rose Marie Bitar, 933
Third Avenue, New Kensington.
2) The type of coverage is listed as automobile
liability.
15. An application for insurance, dated April 9, 1986, with
National Indemnity Company, is signed by Rose Marie Bitar as
the applicant.
a. Two vehicles are listed on the application:
Henry J. Bitar
April 27, 1992
Page 16
1978 Chevrolet Caprice station wagon, VIN #1N35L85103309.
1978 Chevrolet Suburban station wagon, VIN
#CGL168F192756.
b. Four drivers are listed:
Alfreda Olean, John Olean, George Naamy and Henry Sitar.
c. A memo, dated May 9, 1986, advised that the vehicles are
also used as personal vehicles.
d. The two vehicles listed are used to pick up children in
New Kensington and Arnold and transport them to local
(New Ken - Arnold) schools.
e. The following restrictions were placed on the policy
covering vehicles used as school buses by National
Indemnity, and are stated in a letter to Henry J. Bitar,
dated June 11, 1986:
1) The radius of the use of the vehicles is limited to
50 miles for both personal and school bus use.
2) Henry Sitar and George Naamy are excluded as
drivers.
3) Additional correspondence indicates that the
National Indemnity coverage and restrictions were
accepted by Bitar until less restrictive coverage
could be found.
16. Records of the McKee Wesley Insurance Services, Inc., 819
Fifth Avenue, New Kensington, Pennsylvania show that Henry
Bitar was the contact person for the transportation company
and that his name appears on a number of documents relating to
the transportation company vehicle insurance.
a. Automobile loss notices for a 1978 Chevrolet Caprice
station wagon (VIN #1M35L85103309), list Henry J. Bitar
as the insured in 1981 and in 1984 on the policy with
National Indemnity Company.
b. In 1986, the insured is listed as Henry J. and Rose Marie
Sitar and the policy has changed to Liberty Mutual.
1) In a letter, dated July 2, 1986, from Smith McKee
to Henry Bitar, McKee discusses cancellation of the
policy with National Indemnity for automobile
Henry J. Sitar
April 27, 1992
Page 17
coverage and new automobile coverage with Liberty
Mutual.
c. In 1987, the insured is listed as Henry and Rose Marie
Bitar.
d. In 1989, the insured is listed as Rose Marie Sitar.
1) Henry Bitar is listed as the contact person.
(e) Miscellaneous correspondence from McKee Wesley
Insurance Services, Inc., regarding automobile
insurance for the transportation company
vehicles indicates that all correspondence is
directed to Mr. Henry J. Bitar.
(f) A July 25, 1986 memo requests the correct
driver's license number for John Olean, in
regard to coverage of Henry J. Bitar.
17. Pennsylvania assigned risk applications of Rose Marie Bitar
for coverage of vehicles used as school buses indicate the
following:
a. National Indemnity Renewal Application, dated May 8,
1985, in Rose Marie Bitar's name and signed by same.
b. A renewal of Liberty Mutual Policy, dated August 18,
1986, in the name of Henry J. Bitar.
1) September 15, 1986, memo, requesting an amendment
to include Rose Marie Sitar.
2) An October 10, 1986, memo, advising of the
cancellation of policy #AS1- 381 - 038169 -016 on June
30, 1986; and the issuance of a new policy #AS1-
381 -03819
-026 on June 30, 1986.
3) An Application for Pennsylvania Assigned Risk Plan,
signed by Henry J. Sitar, dated May 8, 1986, with a
note advising of an agency error in that Rose Marie
Bitar should have been listed as the insured.
c. A renewal of the Liberty Mutual Policy in the name of
Henry J. Bitar, for the period June 30, 1987, through
June 30, 1988.
1) A notation to have an application in Rose Marie's
name, with her signature, in 1989.
Henry J. Bitar
April 27, 1992
Page 18
2) An Application for Pennsylvania Automobile
Insurance Plan, signed by Henry J. Bitar, dated
July 25, 1987.
3) A notation that the 78 Chevrolet, Serial
#1N35L85103309, has been substituted with an 87
Chevrolet, Serial #1G1BN81YOHX206122.
4) The drivers are listed as Michael Harding and
Kathleen Harding.
5) An Application for Pennsylvania Automobile
Insurance Plan, signed by Henry J. Bitar, dated
January 11, 1988, to replace a vehicle listed on
the previous policy.
(d) A renewal of Liberty Mutual Policy in the name of
Rose Marie Bitar, for the period June 30, 1988,
through June 30, 1989.
1) An Application for Pennsylvania Automobile
Insurance Plan signed by Rose Marie Bitar,
dated January 16, 1989.
An Application for Pennsylvania Assigned Risk,
signed by Rose Marie Bitar, dated May 16,
1988.
(e )
A Business Auto Coverage Form, dated May 3, 1990,
(updated June 30, 1990), in the name of Rose Marie
Bitar, 933 Third Avenue, New Kensington,
Pennsylvania.
1) The policy number is listed as AS1- 381 - 043853-
010.
2) The name insured is an individual; occupation
or business - school bus.
3) The policy is renewal and covers the period
June 30, 1990, through June 30, 1991.
4) Two vehicles are covered; 1978 Chevrolet
station wagon (VIN #CCL168F192756), and a 1987
Chevrolet station wagon (VIN
#1G1BN81YOHX206122).
Invoice from Liberty Mutual to McKee Wesley
Insurance Services, Inc., on behalf of Rose
Marie Bitar covering the period June, 1989,
through December, 1989, and June, 1990,
Henry J. Bitar
April 27, 1992
Page 19
through December, 1990.
6) A renewal of the Business Auto Coverage for
the vehicles identified above.
18. A letter, dated October 8, 1987, from Smith C. McKee, to
Attorney Daniel Joseph, gives an explanation of the history of
the insurance coverage with Mr. and Mrs. Bitar with regard to
vehicles with which they have provided transportation services
to the W.I.U.
a. Sitar transferred his business from Delaware Valley
Underwriting Agency to McKee Wesley on or around May,
1980.
b. A note, dated September 12, 1984, from Bitar requested
the policy name be changed to Rose Marie Bitar.
c. An insurance certificate was supplied to the W.I.U. with
the named insured listed as Rose Marie Bitar at a new
address of 933 Third Avenue.
d. A subsequent certificate was mailed to the
W.I.U. after the policy was renewed May 8, 1985 and June
8, 1986.
1) The policy was changed to Pennsylvania Automobile
Insurance "Assigned Risk Plan ", sometime after June
8, 1986.
2) The policy was mistakenly issued in the name of
Henry J. Bitar.
3) No records indicate that Mrs. Bitar made McKee
Wesley aware of the error.
4) On or around June 8, 1987, Mr. Henry Bitar advised
that the policy was wrong and should be corrected.
5) The company required cancellation of the existing
policy and re- application.
6) Due to the time and expense and the fact that the
named insured condition of the policy included the
spouse, McKee let the policy remain as written.
19. U. S. Individual Income Tax Returns for 1987 and 1988 were
jointly filed by Henry J. and Rose Marie Bitar, 249 Charles
Avenue, New Kensington, Pennsylvania.
Henry J. Bitar
April 27, 1992
Page 20
a. The proprietor of Bitar's Snack Bar, 933 Third Avenue,
New Kensington, is listed as Marie Bitar, and shows a net
loss of $9,054.00 in 1987, and a net loss of $2,489.00 in
1988.
b. The proprietor of the Service- Transportation Company, 933
Third Avenue, New Kensington, is listed as Marie Bitar,
and shows a net profit of $17,616.00 in 1987, and a net
profit of $10,064.00 in 1988.
c. Depreciation and Amortization, Form 4562, is filed under
both Henry J. and Marie Sitar, regarding Schedule C2
which includes Depreciation Schedules for a 1978
Chevrolet station wagon and a 1978 Chevrolet Suburban.
20. Statements of Financial Interest on file with the W.I.U.
Assistant Secretary, Helen Nelson, for Henry Bitar for the
years 1987 through 1989, include the following:
a. Filing date: 3/1/90
For the Year: 1989
Source of Income: Bitar's Snack Bar, 933 Third Avenue,
New Kensington, PA
Office or directorship: Cedar's - Partner
Creditors: Mellon Bank - 12%
All other financial interest categories: None
b. Filing date: 4/17/89
For the Year: 1988
Source of Income: Bitar's Snack Bar, 933 Third Avenue,
New Kensington, PA
Office or directorship: Cedar's - Partner
Creditors: Mellon Bank - 12%
All other financial interest categories: None
c. Filing date: 4/28/88
For the Year: 1987
Source of Income: Bitar's Snack Bar, 933 Third Avenue,
New Kensington, PA
Office or directorship: Cedar's - Partner
Creditors: Mellon Bank - 12%
All other financial interest categories: None
21. The W.I.U. records of statements of financial interests for
other years were unavailable for all officials.
Henry J. Sitar
April 27, 1992
Page 21
III. DISCUSSION:
As a New Kensington School Director, and Westmoreland
Intermediate Unit Member, Henry J. Bitar, hereinafter Biter, is a
public official as that term is defined in the Ethics Act, 65 P.S.
402; 51 Pa. Code 1.1. As such, his conduct is subject to the
provisions of the Ethics Act and the restrictions therein are
applicable to him.
Initially, it is noted that Section 9 of Act 9 of June 26,
1989, P.L. 26, provides, in part, as follows:
"This amendatory act shall not apply to
violations committed prior to the effective
date of this act, and causes of action
initiated for such violations shall be
governed by the prior law, which is continued
in effect for that purpose as if this act were
not in force. For the purposes of this
section, a violation was committed prior to
the effective date of this act if any elements
of the violation occurred prior thereto."
Since the occurrences in this case transpired prior to the
effective date of Act 9 (June 26, 1989), we must apply the
provisions of Act 170 of 1978, P.L. 883, to determine whether the
Ethics Act was violated.
Under Section 3(a), quoted above, this Commission has
determined that use of office by a public official to obtain a
financial gain for himself or a member of his immediate family or
a business with which he is associated which is not provided for in
law transgresses the above provision of law. Thus, use of office
by a public official to obtain a financial gain which is not
authorized as part of his compensation is prohibited by Section
3(a): Hoak /McCutcheon v. State Ethics Commission, 77 Pa. Commw.
Ct. 529, 466 A.2d 283 (1983); Yacobet v. State Ethics Commission,
109 Pa. Commw. Ct. 432 531 A.2d 536 (1987). Similarly, Section
3(a of the Ethics Act would prohibit a public official /employee
from using public office to advance his own financial interests;
Koslow v. State Ethics Commission, 116 Pa. Commw. Ct. 19, 540 A.2d
1374 (1988).
Section 3(c) of Act 170 of 1978 quoted above provides in part
that no public official /public employee or a member of his
immediate family may contract with his governmental body if the
contract is $500.00 or more unless it is awarded through an open
and public process including prior public notice and subsequent
public disclosure.
Henry J. Bitar
April 27, 1992
Page 22
The issue before us is whether Bitar violated either Section
3(a) or 3(c) of Act 170 of 1978 regarding his voting to award
busing contracts to a firm owned by his wife and regarding the
contracting process as to the award of those contracts to his
wife's busing company.
Factually, Bitar has served as both the Director of the New
Kensington - Arnold School Board as well as the. Westmoreland
Intermediate Unit (WIU). Bitar's wife, Rose Marie, is the
registered owner of a transportation company which is operated
under the names of either Rose Marie Bitar or Ar -Ken. The WIU has
contracted for approximately the past twenty years with Rose Marie
Bitar or Ar -Ken for the transportation of special education
students. The minutes of the WIU Board for the years of 1979
through 1989 reflect Bitar voting to approve or extend
transportation contracts between WIU and Rose Marie Bitar or Ar-
Ken. However, for the Board meetings which occurred on October 31,
1983, November 27, 1984, November 24, 1987, November 25, 1988, and
November 28, 1989, Bitar abstained• from those votes as to the
bussing contracts. In this regard, the WIU Board Solicitor issued
an opinion on November 19, 1987 advising Bitar to abstain from
voting on issues relating to the contract with Ar -Ken. Bitar
followed that opinion and abstained on all subsequent votes
regarding the transportation contracts.
The record reflects that Bitar signed a number of
transportation contracts between the WIU and Rose Marie Bitar or
Ar -Ken as President of the Board; in addition, certain of the
monthly checks that were issued to Rose Marie Bitar or Ar -Ken were
co- endorsed by Sitar. The payments by WIU to Rose Marie Bitar or
Ar -Ken are reflected in Fact Finding 10.
As to Rose Marie Bitar and Ar -Ken, it appears from the record
that Bitar does have a financial interest in his spouse's
transportation company. Thus, as to certain insurance policies
issued by National Indemnity Company relative to the transportation
business, Bitar is listed as the insured or is listed as a school
bus driver. (Fact Finding 14(a)). When the insurance was switched
to National Indemnity Company, Bitar is listed as one of the
drivers (Fact Finding 15). Likewise, the records of McKee Wesley
Insurance Services reflect Bitar as a contact person for the
transportation company, list him as the insured in certain policies
and finally reflect that his name appears on a number of documents
relating to the company's insurance (Fact Finding 16). Finally, we
note that for tax purposes, although the transportation is listed
as proprietorship of Rose Marie Bitar, the depreciation as to the
vehicles used in the transportation vehicles is filed jointly under
both Mary Bitar and Bitar.
Applying the provisions of Sections 3(a) and 3(c) of Act 170
Henry J. Bitar
April 27, 1992
Page 23
of 1978 quoted above to the facts of this case, we find violations
of both provisions of the Ethics Act. As to Section 3(a), there
clearly has been a use of office on the part of Bitar regarding
voting through the years on the awards or extensions of the
transportation contracts to Rose Marie Bitar or Ar -Ken which is a
business run by a member of Bitar's immediate family, his spouse
Rose Marie. Fletcher, Opinion 89 -018. The term "immediate family"
is defined under Act 170 of 1978 as follows:
65 P.S.
Section 2.
"Immediate
person's
children.
S402.
IV. CONCLUSIONS Oy LAW:
Definitions.
family." A spouse residing in the
household and minor dependent
It is clear that the use of public office by Bitar resulted in a
financial gain consisting of the profits that were made on the
school transportation contracts. As noted, the financial gain was
not only to a member of his immediate family but in fact appears to
have benefitted Biter directly in light of his involvement or
financial interest in his wife's school transportation business.
Finally, the compensation received is other than provided for by
law because there is no provision in law which would allow a school
board member to be involved in such contracts. In fact, Section 3-
324 of the Public School Code, 24 P.S. 3 -324, may very well indeed
prohibit such activity.
We do note as to Bitar that his vote was never the deciding
vote and further that after the Board's Solicitor advised him to
abstain as to voting on the award or extension of such school
busing contracts, Bitar did follow the Solicitor's advice by
abstaining.
As to the Section 3(c) allegation, we find a violation because
Biter's spouse, who is a member immediate family, contracted for
bus transportation services with the school district wherein the
contracts exceeded the $500.00 threshold of Section 3(c) but were
not awarded through an open and public process. Since the
contracting requirements as mandated by Section 3(c) of Act 170 of
1978 were not followed, a violation of Section 3(c) of Act 170 of
1978 occurred in this case.
However, based upon the totality of the facts and
circumstances of this case, we will take no further action.
Henry J. Biter
April 27, 1992
Page 24
1. Henry J. Sitar as a Director of the New Kensington School and
Westmoreland Immediate Unit is a public official subject to
the provisions of Act 170 of 1978.
2. Sitar violated Section 3(a) of Act 170 of 1978 when he voted
to award or extend school transportation contracts to his
wife's firm.
3. Sitar violated Section 3(c) of Act 170 of 1978 when his wife's
school transportation firm entered into school busing
contracts with his governmental body which contracts were over
$500.00 but which were not awarded through an open and public
process.
In re: Henry J. Bitar
ORDER NO. 849
: File Docket: 87 -149 -C
: Date Decided: April 23, 1992,
: Date Mailed: April 27, 1992
1. Henry J. Sitar as a Director of the New Kensington School and
Westmoreland Immediate Unit violated Section 3(a) of Act 170
of 1978 when he voted to award or extend school transportation
contracts to his wife's firm.
2. Bitar violated Section 3(c) of Act 170 of 1978 when his wife's
school transportation firm entered into school busing
contracts with his governmental body which contracts were over
$500.00 but which were not awarded through an open and public
process.
3. Based upon the totality of facts and circumstances of this
case, we will take no further action.
BY TH COMMISSION,
DENNIS C. HARRINGTON, CHAIR