HomeMy WebLinkAbout821 DixonIn re: Thomas Dixon
I. ALLEGATION:
STATE ETHICS COMMISSION
308 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
: File Docket:
. Date Decided:
: Date Mailed:
88 -112 -C
December 4,1991
December 11,1991
Chair
Before: Dennis C. Harrington,
James M. Howley
Daneen E. Reese
Roy W. Wilt
Austin M. Lee
James P. Gallagher
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 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.
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 $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).
Dixon, 88 -I12 -C
Page 2
That you, Mayor of Wallaceton Borough, Clearfield County,
violated the following provisions of the State Ethics Act when
you contracted with the borough to construct an addition to the
borough municipal building without an open and public process:
Section 3. Restricted Activities.
(a) No public official or public employee shall
use his public office or 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. S403(a).
Section 3(c) of the Ethics Act provides:
(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. S403(c).
II. FINDINGS:
1. Thomas Dixon serves as the Mayor of Wallaceton Borough.
a. He has served in this position since 1966.
2. Thomas Dixon is the owner of the Joseph Dixon Contracting
Company, Wallaceton.
a. He has operated this entity since 1967.
b. Said company was previously owned and operated by
Thomas Dixon's father, Joseph Dixon.
3. Thomas Dixon also serves as the President of the Clearfield
County Grange Mutual Fire Insurance Company.
Dixon, 88 -112 -C
Page 3
a. Thomas Dixon took over this insurance business
from his father, Joseph Dixon, in 1966.
b. Thomas Dixon receives a commission on all
insurance he places.
c. The Commission equals 15%
premium, and Thomas Dixon
check from the Clearfield
Fire Insurance Company on
a. That structure was a fire hall.
a. Qecember 3, 1979:
of the insurance
receives his commission
County Grange Mutual
a quarterly basis.
4. Wallaceton Borough is served by a local fire department.
a. The fire department is an entity separate and
distinct from the borough.
b. The borough does offer support to the fire
department.
5. The borough acquired a parcel of property in 1963 and
shortly thereafter the Wallaceton Fire Department built a
structure on that property.
b. The borough retained ownership of the property at
that time.
6. Subsequent to the time when Wallaceton Borough acquired the
property and the structure was constructed, the borough and
the fire department began to consider renovating that
facility.
7. In order to initiate the renovation of the fire department
building, it was necessary for the borough to transfer
ownership of the property to the department and to assist in
obtaining financing for the project.
8. Minutes of the Wallaceton Area Borough Council indicate the
following action was taken by council relative to renovating
the fire hall, transferring the land and securing the
financing:
"Wallaceton Area Fire Company had a request for
council to borrow $30,000.00 to complete the fire
hall and Community Office Building. Richard Shuy
made a motion to borrow the money but after some
debate, it was decided to have the lawyer look
Dixon, 88 -112 -C
Page 4
into it . . . it was tabled until the next
meeting when council would take action on it."
b. Aril 7, 1980
"On the advice of the lawyer, council decided to
call a special meeting concerning borrowing the
money for the firemen to finish the addition."
Present: Council - Nancy Hull, Harold Williams,
Roger Shimmel and Richard Shuy; Mayor, Thomas
Dixon
c. April 14, 1980:
"Council discussed the possible transfer of land
originally transferred to the borough from
Harbison - Walker Refractories to the fire company.
The land transfer by Harbison - Walker was with the
understanding the land would be restricted to
public use only. Council said Harbison - Walker
agreed that use by the fire company would conform
to this restriction. The fire company wants to
expand it's building."
Present: Not listed.
d. Mav 5, 1980:
"There was some discussion about putting a
borough office and water authority office in the
fire hall, if they get the money to finish the
building."
"Roger Shimmel made a motion to have the deed
transferred from the borough to the fire company.
Richard Shuy seconded the motion; no vote was
taken. Roger Shimmel told the secretary to call
Lawyer Caifly to tell him to begin working on the
deed."
Present: Not listed.
e. June 2, 1980:
"Discussion took place on the deed being turned
over to the fire company. Harold Williams made a
motion, seconded by Roger Shimmel, that as of
June 2, 1980, the deed be turned over to the fire
department. Motion carried."
Dixon, 88 -112 -C
Page 5
f. August 4, 1980:
"Roger Shimmel explained the agreement the fire
company wants to have with council concerning the
borrowing of money. Lawyer Caifly explained if
the fireman would at any time not be able to make
a payment, council would be responsible for that
payment. He suggested borrowing enough money to
put a roof on. Council should have a special
meeting with the fireman to work this out. A
special meeting has been advertised for August 13,
1980, Wallaceton Fire Hall at 7:30 pm."
Present: Council - Nancy Hull, Roger Shimmel,
Richard Shuy and Harold Williams; Mayor, Thomas
Dixon
g.
"An amendment to the motion made by Harold
Williams that the deed not be turned over to the
fire department. Nancy Hull seconded it. No vote
recorded."
Present: Not listed.
August 13, 1980:
Special Meeting - "Lawyer Caifly suggested taking
out a smaller loan to get the building under cover
before the cold weather sets in. Roger Shimmel
gave a report on what they would need the loan for
and the amount of money the materials would cost.
Harold Williams said to borrow $10,000.00. Roger
Shimmel made a motion to borrow $11,000.00, using
$10,000.00 for building supplies and keep a
$1,000.00 on hand if they need it. Phillip Dixon
seconded it, passed and carried."
"The fire company is going to make a committee of
four to take charge of this account, the duty of
which is to sign checks."
Present: Not listed.
h. April 1981:
Special Meeting - "A special meeting was called
with the firemen to see if they could work out
something concerning the loan. There was
discussion on raising money."
Dixon, 88 -112 -C •
Page 6
Present: Phillip Dixon, Nancy Hull, Harold
Williams and Mary Lou English
i. June 6, 1983:
"There was a discussion on having a building
erected for council meetings and to store the
files in. There will be a special meeting next
Monday, June 13, 1983, at 7:30."
j
Present: Not listed.
June 15, 1983:
Special Meeting - "A special meeting was held
concerning the erection of a building to house
borough materials and to have the monthly meetings
in. It was practically decided to put it in back
of the fire hall."
Present: Not listed.
k. June 15, 1983:
"Discussion occurred on the location of the
perspective borough building, representative from
North Central Planning will gladly meet with
council to discuss the financial end of the
building. A meeting will be held on July 20,
1983, 7:00 pm.
Present: Not listed.
1. August 8, 1983:
"A representative was present from North Central
Planning concerning the loan for the new municipal
building. There will be a special meeting
August 15, to discuss the size of the building and
its cost."
Present: Not listed.
M. August 15, 1983:
"Representatives were present from the fire
company, water authority and council to discuss
the building. No definite plans were made. There
will be another special meeting concerning the
building on September 20, 1983."
Dixon, 88 -112 -C
Page 7
Present: Not listed.
n. September 20. 1983
"In order to find out the exact amount of
payments, Clearfield Bank & Trust requires that a
set of plans for the building be drawn up."
"Payments on a loan of $30,000.00 would be $276.04
per month for ten years through the Department of
Community Affairs. In order to find out the exact
amount of payments from Clearfield Bank & Trust
Company for $40,000.00, we must have a set of
plans for the building."
P.
q.
Present: Not listed.
o. October 19, 1983:
Special Meeting - "A motion was made by Dottie
Miller to lease the property to the fireman for 99
years. Harold Williams seconded it." No vote
recorded.
Present: Not listed.
November 7, 1983:
"Nick Fusco is working on plans for the addition
on the fire hall."
Present: Not listed.
(1). The floor plans that are reflected in
the minutes as being considered are for
the existing building as it now stands.
December 5, 1983:
"President Phillip Dixon informed Council that the
application for the loan has been sent in."
Present: Not listed.
r. January 1, 1984:
"The addition for the fire hall was discussed.
Nick Fusco is working on the floor plans. It was
agreed upon to ask Larry Diehl to draw up plans
for the labor and materials."
Dixon, 88 -112 -C
Page 8
Present: Not listed.
s. February 6. 1984:
"Phillip Dixon cannot get in contact with Gwen
Almond; she is to call him concerning the loan and
office plans for the addition."
"A contract was to be made between the Water
Authority and council concerning the monthly
payment for the addition of the building."
Present: Not listed.
t. March 5, 1984:
"The secretary is to advertise it in The Progress
that the fire company is involved in the new
addition to the fire hall. Council is not
involved. Council is going to rent a space from
the fire company after the building is done."
"Phil Dixon is to call Denning Gearhart and have
him add to the lease a binding statement
concerning all three parties (Council, Fireman and
Water Authority) concerning the monthly payments
for the new addition."
Present: Not listed.
u.- June 4, 1984:
"There will be a special meeting June 18, 1984
concerning the addition to the fire hall. Several
things will have to be discussed before the
application can be sent in. Tom Dixon is to come
up with some prices for building supplies."
"The 99 year lease cannot be found by (the)
secretary."
Present: Not listed.
v. September 10. 1984:
"More information was needed by Gwen Almond for
our loan. Phillip Dixon is trying to get this
information gathered up. Bill Siother called
Dixon, 88- .112 -C
Page 10
After five years:
Wallaceton Borough - $120.00
Wallaceton Municipal Authority - $48.00
Wallaceton Fire Company - $62.00
It was noted that the borough will not pay the
firemen for the first five years because of the
loan. We will negotiate on the terms for the
following five years."
Present: Not listed.
aa. February 4, 1984,:
"Phil made a motion to give the fire company a
donation of $10,000.00 for the new building. All
in favor."
"Regarding the Title Search for the new building,
Denning Gearhart is to do the Title Search and
the borough will receive the bill. It will cost
$600.00."
Present: Not listed.
bb. August 5, 1985:
"Ardell Hamer of the Wallaceton Water Authority
was present to discuss the office space in the new
building. Dottie Miller made a motion to leave
the office space as it was shown on the original
plans. Motion was seconded by Phillip Quick."
Present: Council - Phillip Dixon, Mary Lou
English, Phillip Quick, Dorothy Miller and Harold
Williams; Mayor - Thomas Dixon
cc. August 12, 1985:
"Water Authority members were upset and wanted to
know why they couldn't have their own office
space. A discussion took place about the office
space in the new building. It was agreed upon
that if a problem should arise in the future, a
suitable solution should be found.
Present: Not listed.
Dixon, 88 -112 -C
Page 9
about the bank loan; he stated that it must be
advertised a number of times."
"Discussion on what to do about the money was
tabled until next month."
Present: Not listed.
w. October 1, 1984:
"Phillip Dixon received a letter from Denning
Gearhart stating that he has run into some
problems (with) the procedures according to the
Department of Community Affairs concerning our
loan. Mr. Gearhart's associate will be contacting
Phil for more information next week. Tom Dixon is
working on an estimate of materials for the
addition."
x. November 5, 1984:
"Phillip Dixon read a letter from Denning Gearhart
concerning the resolution on the addition to the
fire hall. He then took a raised hand vote of
council members concerning borrowing the money
now. There were six yes's and zero no's. Motion
passed and carried.
Present: Not listed.
Present: Not listed.
December 3, 1984:
"Loan papers for the new addition were signed by
President Phillip Dixon and Secretary Lovie
Havens."
Present: Not listed.
z. January 14. 1985:
Special Meeting - "The following are approximate
percentages for the first five years of the loan:
Wallaceton Borough - 72 %, $24.00
Wallaceton Municipal Authority - 21 %, $100.00
Wallaceton Fire Company - 27 %, $130.27
Dixon, 88 -112 -C
Page 12
hh. May 6, 1985:
"Attorney Gearhart discussed the borrowing base
for the loan. A loan addendum and agreement was
then signed. Council also discussed going to the
bank to sign for part of the loan. There was a
problem with borrowing the entire $10,000.00
because of the DCA approval. Therefore, the bank
decided to release $6,000.00 of the $10,000.00
until it was cleared by DCA."
Present: Council - Phillip Dixon, Mary Lou
English, Dorothy Miller, Phillip Quick and Harold
Williams; Mayor - Thomas Dixon
ii. January 6, 1986:
"Council discussed the new building. It was
decided to write a letter to Mr. Jae Chung stating
that borough council feels the building is
completed and suitable for occupancy."
Present: Council - Phillip Dixon, Mary Lou
English and Dorothy Miller; Mayor - Thomas Dixon
jj. February 1_. 1986:
"Council discussed the new building. The
secretary is to write a letter to the Wallaceton
Fire Company regarding the money. Also discussed
was a door being put into the fire hall."
Present: Council - Phillip Dixon, Dorothy Miller,'
Mary Lou English and Bonnie Hansell; Mayor -
Thomas Dixon
kk. Undated - Special Meeting:
This meeting occurred between March 3, 1986 and
April 7, 1986.
"This meeting was called to discuss the office
space which was to be rented by the water
authority. Council also discussed the cost of
putting up a partition in the new office space."
Present: Council - Mary Lou English, Phillip
Dixon, Phillip Quick and Bonnie Hansell; Mayor -
Thomas Dixon
Dixon, 88 -112 -C
Page 11
dd. October 7, 1985:
"Members of the Wallaceton Fire Company were
present to discuss the building. It was decided
to have a meeting at the fire hall on October 8,
1985 to discuss the situation."
Present: Council - Harold Williams, Dorothy
Miller, Mary Lou English and Phillip Quick; Mayor
- Thomas Dixon
ee. October 8, 1985:
"$4,000.00 from the bank will be discussed at the
next council meeting."
Present: Council - Harold Williams, Mary Lou
English, Dorothy Miller and Phillip Quick; Mayor -
Thomas Dixon
ff. November 4, 1985:
gg•
"Harold Williams made a motion to turn the
$4,000.00 over to the fire company. Phillip Quick
seconded the motion.
Present: Council - Phillip Dixon, Phillip Quick,
Harold Williams and Mary Lou English; Mayor:
Thomas Dixon
April 23, 1985:
"Borough Council members and Municipal Authority
members attended the regular Wallaceton Fire
Company meeting to discuss the Addendum and
Agreement for the new building. The addendum was
read aloud and all three parties discussed it. It
was agreed that the percentages would be as
follows:
Wallaceton Borough - 52%
Wallaceton Fire Company - 27%
Wallaceton Municipal Authority - 21%
The addendum was signed by all parties."
Present: Council - Phil Dixon, Mary Lou English,
Phillip Quick and Harold Williams; Mayor - Thomas
Dixon
Dixon, 88 -112 -C
Page 13
11. March 3, 19(6:
"Thomas Dixon submitted a check to the borough in
the amount of $5,000.00 for a refund of excessive
estimates. The money will go into the General
Fund."
Present: Council - Phillip Quick, Phillip Dixon,
Mary Lou English, Dorothy Miller and Bonnie
Mansell; Mayor - Thomas Dixon
mm. April 7, 1986:
"Wallaceton Fire Company gave a check to the
borough in the amount of $2,000.00 for excessive
estimates. This check will go into the General
Fund."
"Wallaceton Fire Company, Wallaceton Municipal
Authority and attorneys Gearhart, Ireland and
Morgan were present to discuss the office space in
the building. The addendum and agreement were
looked over by both parties; several members of
each party looked at the new building addition.
Wallaceton Water Authority made an offer to give
$250.00 for materials towards a partition in the
new office. A motion was made that the borough
council accept the Water Authorities offer of
$250.00 for building a partition."
Present: Council Phillip Dixon, Bonnie Hansen,
Mary Lou English and Phillip Quick; Mayor - Thomas
Dixon
nn. June 2, 1986:
"Council discussed the agreement between the Water
Authority and the fire department regarding a new
partition."
Present: Council - Phillip Dixon, Phillip Quick,
Mary Lou English, Dorothy Miller and Bonnie
Mansell; Mayor - Thomas Dixon
oo. August 4. 1986:
"Mary Lou English asked if the borough would share
half of the payment for the building which is
supposed to be shared between the fire company and
the water authority. The secretary is to call the
solicitor regarding this matter."
Dixon, 88 -112 -C
Page 14
Present: Council - Phillip Dixon, Phillip Quick,
Mary Lou English, Dottie Miller and Bonnie
Hansell; Mayor - Thomas Dixon
pp. September 8. 1986:
"Council discussed the agreement which Attorney
Denning Gearhart was supposed to have done
regarding the new partition. Council would like a
letter sent to Denning Gearhart requesting he take
immediate action on this matter."
Present: Council - Phillip Dixon, Mary Lou
English, Bonnie Hansell and Dorothy Miller; Mayor
- Thomas Dixon
9. The borough did not solicit or otherwise publicly seek bids
to conduct the construction project.
a. Section 1402(a) of the Borough Code states in part
that all contracts in excess of $4,000.00 should
be awarded to the lowest responsible bidder after
public notice in at least one local paper on at
least three occasions.
b. Section 1404 of the Borough Code states in part
that no borough official either elected or
appointed shall be interested to any appreciable
degree either directly or indirectly in any
purchase made or contact entered into involving a
borough expenditure of more than $1,000.00 in any
calendar year. In a case of councilman or mayor,
he shall so inform council and shall refrain from
voting on the expenditure.
10. Thomas Dixon submitted estimates for renovations of the
Wallaceton Area Fire Company's building on July 2, 1984 and
September 4, 1984.
a. Estimate Date - July 2, 1984:
Materials and Labor - $31,513.00
Plumbing /Electrical - 6,000.00
Interior Finishing - 12
Total $50,000.00
b. Estimate Date - September 4, 1984:
Dixon, 88 -112 -C
Page 15
Same dimensions and specifications as the bid
listed in Finding 10(a):
Bid Price - $35,000.00
No other bids were sought or received for this project.
11. Wallaceton Borough's share of the construction project
totaled $10,000.00.
12. Financial records of Wallaceton Borough indicate that a
$10,000.00 loan was taken out from the Clearfield County
Bank & Trust Company, 11 North Second Street, Clearfield, PA
16830.
a. $10,000.00 was deposited into Clearfield County
Bank & Trust Company, Account No. 130 - 62006.
Account No. 130 -62006 is Wallaceton Borough's
checking account. Deposits were made as follows:
1) May 14, 1985 - $6,000.00
2) October 1, 1985 - $4,000.00
13. The fire department was to provide the remaining $25,000.00
cost of the project.
a. The department obtained a loan from the
Pennsylvania Emergency Management Agency,
Volunteer Loan Assistance Program.
b. The loan was obtained on 2/8/85.
c. Conditions of the note are $25,000.00 at a 2%
interest rate for ten years. Monthly payments are
listed at $230.04.
14. Joseph Dixon Contracting performed the construction of the
addition to the fire hall.
a. Thomas Dixon became involved in the transaction
because of the prior default of an individual and
acted to negate the harm which would incur to
Wallaceton Borough.
b. The work was performed pursuant to customary
practices and Dixon was aware of the availability
of audit and other checks and balances for any
improprieties.
Dixon, 88 -112 -C
Page 16
15. Wallaceton Borough Financial records indicate the following
disbursements were made to Joseph Dixon Contracting:
a. Check No. 1363 from Clearfield Bank & Trust
Company, Account No. 130 - 62006, dated 4/14/85, for
$6,000.00.
b. Check No. 103 from the Pennsylvania Local
Government Investment Trust Fund, Morris Drive,
Box 1472, Valley Forge, PA 19482, Account No.
152403 -5, dated 5/13/85, for $2,000.00.
c. Check No. 105 from the Pennsylvania Local
Government Investment Trust Fund, dated 8/15/85,
for $5,000.00.
16. The total disbursements to Thomas Dixon from the borough
amounted to $13,000.00.
17. Records of Thomas Dixon and the Wallaceton Borough confirm
the following refunds were made by Dixon to the borough:
6/11/85 - $8,000.00
3/3/86 - $5,000.00
Total refund made by Dixon to Wallaceton Borough was
$13,000.00. This left a zero balance on the funds that were
exchanged between Dixon and Wallaceton Borough.
18. Records of the Wallaceton Area Volunteer Fire Department
indicates they received money from Wallaceton Borough as
follows:
6/11/85 - $8,000.00
11/26/85 - 4,000.00
Total Received - $12,000.00
19. The fire department refunded the borough $2,000.00 on
3/11/86, leaving the total amount received from the borough
at $10,000.00.
20. Wallaceton Ambulance or Fire Department records indicate the
following disbursements were made to Thomas Dixon:
4/1/85 - $7,500.00
5/28/85 - $8,750.00
Dixon, 88 -112 -C
Page 17
6/11/85 - $8,000.00
2/25/86 - $10,750.00
Total Payments to Dixon - $35,000.00
21. Monies were being transferred between Wallaceton Borough,
Thomas Dixon and the Wallaceton Area Fire Department to
cover Dixon's expenses until loan monies were received by
the fire department.
22. Statements of Financial Interests on file with Wallaceton
Borough Secretary include the following filings for Thomas
Dixon:
a. Calendar Year: 1986
Filed: 2/3/86 on SEC Form 7/84
Position: Mayor
Occupation: Contractor
Real Estate Interests: None
Creditors: None
Direct /Indirect Income: Clearfield County Grange
Insurance, Joseph Dixon Contracting
Office /Directorship in Any Business: Clearfield
County Grange Mutual Insurance, President and
Director
Financial Interest in Any Business: None
b. Calendar Year: Not Listed
Filed: 2/2/87 on SEC Form 1/86
Position: Mayor
Occupation: Contractor
Real Estate Interests: None
Creditors: None
Direct /Indirect Sources of Income: Joseph H.
Dixon Contracting
Dixon, 88 -112 -C •
Page 18
Office /Directorship in Any Business: Clearfield
County Grange Mutual Fire Insurance
Financial Interest in Any Business: None
c. Calendar Year: Not Listed
Filed: 10/3/88 on SEC Form 1/88
Position: Mayor
Occupation: Contractor
Real Estate Interests: None
Creditors: None
Direct /Indirect Sources of Income: Joseph H.
Dixon Contracting Company
Office /Directorship in Any Business: Clearfield
County Grange Mutual Fire Insurance
Financial Interests in Any Business: None
d. Calendar Year: Not Listed
Filed: 4/3/89 on SEC Form 1/89
Position: Mayor
Occupation: Contractor
Real Estate Interests: None
Creditors: None
Direct /Indirect Income: Joseph Dixon Contracting,
Clearfield County, Grange Mutual Fire Insurance
Office /Directorship in Any Business: Clearfield
County, Grange Mutual Fire Insurance, Director
Financial Interests in Any Business: None
e. Calendar Year: 1990
Dixon, 88 -112 -C
Page 19
Filed: 2/5/90 on SEC Form 1/90
Position: Mayor
Occupation: Contractor
Real Estate Interests: None
Creditors: None
Direct /Indirect Income: None
Office /Directorship in Any Business: Clearfield
County Grange Fire Insurance, President and
Director
Financial Interests in Any Business: None
f. Calendar Year: 1991
Filed: 2/4/91 on SEC Form 1/91
Position: Mayor
Occupation: Contractor
Real Estate Interests: None
Creditors: None
Direct /Indirect Income: Dixon Contracting
Office /Directorship in Any Business: Clearfield
County Grange Mutual Fire Insurance, President,
Director, Agent
Financial Interest in Any Business: Dixon
Contracting
23. The following information was not included on Statements of
Financial Interests listed in Findings No. 22 (a, b, c, d
and e).
a. Calendar Year 1986 (See Findings 22(a)]
Item #17: Financial Interest in Any Business -
Joseph Dixon Contracting Company
b. Calendar Year Not Listed [See Findings 22(b)]
Dixon, 88 -112 -C •
Page 20
III. DISCUSSION:
Item #11: Direct /Indirect Sources of Income -
Clearfield County Grange Fire Insurance
Item #15: Financial Interest in Any Business -
Joseph Dixon Contracting Company
c. Calendar Year Not Listed [See Findings 22(c)]
Item #11: Direct /Indirect Sources of Income -
Clearfield County Grange Fire Insurance
Item #15: Financial Interest in Any Business -
Joseph Dixon Contracting Company
d. Calendar Year Not Listed [See Findings 22(b)]
Item #15: Financial Interest in Any Business -
Joseph Dixon Contracting Company
e. Calendar Year 1989 [See Findings 22(e)]
Item #11: Direct /Indirect Source of Income -
Joseph Dixon Contracting Company, Clearfield
County Grange Mutual Fire Insurance
Item #15: Financial Interest in Any Business -
Joseph Dixon Contracting Company
f. Calendar Year 1990 [See Finding 22(f)]
Item #11: Direct /Indirect Sources of Income -
Clearfield County Grange Fire Insurance
As the Mayor of Wallaceton Borough, Thomas Dixon, hereinafter
Dixon, 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
Dixon, 88 -112 -C
Page 21
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,
$thics 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
interests; Koslow v. State Ethics Commission, 116 Pa. Commw. Ct. 19,
540 A.2d 1374 (1988). Likewise, a public official /employee may not
use the status or position of public office for his own personal
advantage; Huff, Opinion 84 -015.
As to Section 3(c) quoted above, this provision of Act 170 of 1978
specifically provides in part that a public official /employee, member
of his immediate family or business with which he or a member of his
immediate family is a director, officer, owner or holder of stock
exceeding five percent of the equity of the business, may not contract
with his governmental body in the amount of $500.00 or more, unless
the contract has been awarded through an open and public process.
The issue before us is whether Dixon violated either Section 3(a)
'or 3(c) of Act 170 of 1978 quoted above regarding the construction of
an addition to the Borough Municipal Building.
Dixon has served as the Mayor of Wallaceton Borough since 1966.
In a private capacity, he is the owner of Joseph Dixon Contracting
Company as well as the president of the Clearfield County Grange
Municipal Fire Insurance Company. In the Borough of Wallaceton, the
fire department, which is a separate entity from the borough, built
its fire hall on borough property. When renovations were being
considered for the fire department building, it was realized that it
was necessary for the borough to transfer ownership to the fire
department and to assist in obtaining financing.
The following activity is reflected in the Wallaceton Borough
Council minutes as to the fire department renovation project: on
December 3, 1979, a request was made and subsequently tabled to borrow
$30,000.00 to complete the fire hall and community office buildings;
Dixon, 88 -112 -C
Page 22
on April 7, 1980, a decision was made to call a special meeting
concerning borrowing money to finish the addition; on April 14, 1980,
discussions occurred regarding the possible transfer of land from the
borough to the fire company; on May 5, 1980, discussions took place
about utilizing part of the fire hall for borough and water authority
offices followed by a motion to have the property transferred from the
borough to the fire company on which no vote was taken; on June 2,
1980, discussions and a successful motion to deed the property to the
fire company, which motion carried and was followed by an amendment to
rescind the motion; on August 4, 1980, discussions that a special
meeting should occur with the firemen to work out the borrowing of
money; on August 13, 1980, a motion was carried, seconded by Phillip
Dixon, to borrow $11,000.00 to get the fire building under cover
before the cold weather set in; in April 1981, a special meeting
occurred regarding loan and raising money; on June 6, 1983,
discussions occurred involving utilization of the building for council
meetings and storage of files; on June 15, 1983, a special meeting
occurred concerning the construction of the building to house borough
materials'and to hold borough monthly meetings; on June 15, 1983,
discussions occurred regarding the location of the prospective
borough building; on August 8, 1983, there was a notation for a
special meeting to discuss the size and cost of the building; on
August 15, 1983, discussions occurred but no definite plans were made
other than to hold another special meeting; on September 20, 1983,
discussions occurred regarding the drawing of plans so that the exact
amount of loan payments could be made to the bank; on October 19,
1983, no vote was taken on a motion for a 99 year lease of the
property to the fire department; on November 7, 1983, a notation
indicated that plans are being prepared; on December 5, 1983, Phillip
Dixon advised council that the loan application had been sent in; on
January 1, 1984, the fire hall additions were discussed as well as
requirements for labor and materials; on February 6, 1984, a notation
reflects that Phillip Dixon was unable to contact an individual '
concerning the loan and plans for the addition; on March 5, 1984, a
notation reflects advertising as to the new addition to the fire hall
as well as Phillip Dixon calling an individual concerning binding
provision in the lease between council, the firemen and the water
authority; on June 4, 1984, an entry for a special meeting as to the
fire hall as well as Dixon coming up with prices for building
supplies; on September 10, 1984, a notation that Phillip Dixon and
another individual were attempting to get information regarding the
loan; on October 1, 1984, Phillip Dixon recounted receiving a letter
from Gearhart concerning problems regarding DCA procedures for their
loan; on November 5, 1984, following the reading of the letter from
Gearhart by Phillip Dixon, there was a hand vote by council to borrow
the money which passed unanimously; on December 3, 1984, the loan
papers were signed by Phillip Dixon and secretary Lovie Havens; on
January 14, 1985, a special meeting occurred regarding loan
percentages; on February 4, 1985, Phillip Dixon made a successful
motion to give the fire company a donation of $10,000.00; on August 5,
1985, discussions occurred regarding office space in the new building;
Dixon, 88 -112 -C
Page 23
on August 12, 1985, further discussion regarding water authority
members' office space in the new building; on October 7, 1985, members
of the fire company discussed the building; on October 8, 1985, a
notation appeared for a future discussion of $4,000.00 from the bank
regarding the project; on November 4, 1985, a motion was made and
seconded to turn $4,000.00 over to the fire company; on April 23,
1985, council and authority members attended the fire company meeting
to discuss the new building; on May 6, 1985, discussions occurred
regarding the borrowing base for the loan as well as a potential
problem for borrowing the entire sum of $10,000.00 from the bank; on
January 6, 1986, council decided to write a letter to the effect that
the building was completed and ready for occupancy; on February 3,
1986, discussions occurred by council concerning the new building and
the writing of a letter to the fire company regarding monetary
matters; in an undated special meeting in March or April on 1986,
discussions ensued concerning the rental of office space by the water
authority; on March 3, 1986, Dixon submitted a check to the borough in
the amount of $5,000.00 for a refund of excessive estimates; on April
7, 1986, the fire company gave the borough a check in the amount of
$2,000.00 for excessive estimates; on June 2, 1986, council discussed
an agreement between the water authority and fire department
concerning a new partition; on August 4, 1986, a council member
inquired as to whether the borough would pay half of the payment for
the building which is to be shared between the fire company and the
water authority, and finally, on September 8, 1986, council discussed
an agreement regarding the new partition.
The borough did not solicit or otherwise publicly bid for the
construction project and Dixon did submit an estimate for the
renovations on July 2, 1984 in the amount of $50,000.00 which he
subsequently re -bid in the amount of $35,000.00 on September 4, 1984.
The borough's share of the construction project amounted to $10,000.00
which was borrowed from the Clearfield County Bank and Trust Company.
The fire department was to provide the remaining $25,000.00 for the
project. The work was performed by Dixon's'company, Joseph Dixon
Contracting. Dixon received payments in the amount of $35,000.00 from
either the Wallaceton Ambulance or Fire Department.
Finally, we note that Dixon in filing his Statements of Financial
Interests (FIS) had various deficiencies such as not listing the
particular calendar year on the form, failing to list his financial
interest in any business or direct or indirect sources of income as
noted in Fact Finding 23.
In applying the provisions of Section 3(a) of Act 170 of 1978
quoted above to the instant matter, we find no violation as to this
particular section in that there is no evidence of any use of office
on the part of Dixon. In particular, the actions that were taken
concerning the fire department renovations were taken by the borough
council and not by Dixon who is the Borough Mayor. Thus, without the
requisite use of office, we find no violation as to Section 3(a) of
Dixon, 88 -112 -C
Page 24
Act 170 of 1978.
However, as to Section 3(c) of the Ethics Act, we find a technical
violation in that the contract was over $500.00 and was not put out
for bids or awarded through an open and public process. Given the
totality of the facts and circumstances in this case, we will take no
further action.
As to the FIS deficiencies, Dixon is directed within thirty (30)
days of issuance of this Order to file amended Statements of Financial
Interests correcting the deficiencies noted in Fact Finding 23.
Failure to comply with the above with result in the referral of this
matter for an FIS enforcement action.
IV. CONCLUSIONS
1. Thomas
public
1978.
OF LAW:
Dixon, as the Mayor of Wallaceton Borough, is a
official subject to the provisions of Act 170 of
2. Dixon did not violate Section 3(a) of Act 170 of 1978
regarding the construction of an addition to the Borough
Municipal Building in that there was no use of office on the
part of Dixon.
3. A technical violation of Section 3(c) of Act 170 of 1978
occurred when a business with which Dixon was associated
obtained a contract in excess of $500.00 to construct an
addition to the borough municipal building which was not
done through an open and public process.
In re: Thomas Dixon
: File Docket: 88 -112 -C
: Date Decided: December 4.199,
: Date Mailed: Dgcember 11.1991,
ORDER No. 821
1. Thomas Dixon, as the Wallaceton Borough Mayor, did not
violate Section 3(a) of Act 170 of 1978 regarding the
construction of an addition to the Borough Municipal
Building in that there was no use of office on the part of
Dixon.
2. A technical violation of Section 3(c) of Act 170 of 1978
occurred when a business with which Dixon was associated
obtained a contract in excess of $500.00 to construct an
addition to the borough municipal building which was not
done through an open and public process.
3. Dixon is directed within thirty (30) days of issuance of
this Order to file amended Statements of Financial Interests
(FIS) correcting the deficiencies noted in Fact Finding 23.
4. Failure of Dixon to comply with paragraph 3 will result in
the referral of this matter for an FIS enforcement action.
BY THE COMMISSION,
e
HARRINGTO CHAT
DENNIS C. , R