HomeMy WebLinkAbout929 FloydSTATE ETHICS COMMISSION
308 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
In Re: Ralph T. Floyd File Docket: 93- 052 -C2
Date Decided: 06/23/94
Date Mailed: 06/30/94
Before: James M. Howley, Chair
Daneen E. Reese, Vice Chair
Roy W. Wilt
Austin M. Lee
Allan M. Kluger
The Investigative Division of the State Ethics Commission
received a complaint regarding a possible violation of the State
Ethics Act, Act 9 of 1989, 65 P.S. S401 et seq. 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 agreement 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
§21.29(b).
The files in this case will remain confidential in accordance
with Act 9 of 1989, 65 P.S. §408(h) 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).
Fl,.,ovd, 93- 052 -C2
Page 2
I. ALLEGATION:
That, Ralph T. Floyd, a Councilman for the Borough of
Honesdale, Wayne County, violated the following provisions of the
State Ethics Act (Act 9 of 1989) when he participated in council
decisions to approve payments to Werner Electric, a company owned
by his daughter and son -in law.
Section 3. Restricted Activities
(a) No public official or public
employee shall engage in conduct that
co0s nstitutes a conflict of interest. 65 P.S.
Section 2. 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. "Conflict" or "conflict
of interest" 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 P.S. 5402.
Section 3. Restricted activities
employee or public spouse or child or
business in which the person or his spouse or
child is associated shall enter into any
contract valued at $500 or more with the
governmental body with which the public
official or public employee is associated or
any subcontract valued at $500 or more with
any person who has been awarded a contract
with the governmental body with which the
public official or public employee is
associated, unless the contract has been
awarded through an open and public process,
Floyd, 93- 052 -C2
Page 3
including prior public notice and subsequent
public disclosure of all proposals considered
and contracts awarded. In such a case, the
public official or public employee shall not
have any supervisory or overall responsibility
for the implementation or administration of
the contract. Any contract or subcontract
made in violation of this subsection shall be
voidable by a court of competent jurisdiction
if the suit is commenced within 90 days of the
making of the contract or subcontract. 65
P.S. 5403(f) .
II. FINDINGS:
1. Ralph Floyd served as a Honesdale Borough Councilman from
April 13, 1992 until March 14, 1994.
2. At the March 9, 1992 council meeting, Floyd was appointed, on
the motion of Councilman H. Richard Osborne, seconded by
Councilman William Rogers, to fill a vacancy on the Honesdale
Borough Council.
a. Floyd was sworn in at the April 13, 1992, council
meeting.
3. Floyd served until March 14, 1994 when he resigned.
4. In January of 1993 Floyd was appointed Chairman of the
Sanitation Committee and served in that capacity until he
resigned from council.
5. As chairman of the Sanitation Committee Floyd oversaw the
operations at the sewer plant.
a. The sewer plant superintendent oversaw the day to day
operations and purchase materials and services.
6. Floyd has owned Walter Electric Company from 1978 to the
present.
a. Walter Electric Company is a general electric contractor.
7. Terry J. Werner worked at Walter Electric Company,
intermittently, from 1983 to 1990.
a. Terry Werner is the son -in -law of Ralph Floyd.
8. In 1990 Werner started Werner Electric Company which continues
in business to the present time.
F1�, 93- 052 -C2
Page 4
a. Werner Electric Company-is a
9. Terry J. Werner married Bonnie S.
T. Floyd in 1984.
10. In November or December of 1991 Dan Guinther, Superintendent
of the Honesdale Borough Sewer Plant, contacted Werner and
inquired if he would be interested in performing electrical
repair work at the plant.
a. No other electrical contractors were contacted.
b. Historically, this is the manner in which electrical
repair work was performed.
c. The electrician who had done the majority of work at the
plant passed away in 1991.
11. Borough Councilman William Rogers, Chairman of the Sanitation
Committee and in charge of overseeing the sewer plant
operations, subsequently informed Werner of what work the
Borough required at the plant.
12. Werner agreed to perform the work on a time ($18.00 an hour)
and materials basis.
a. Werner was given the authority to proceed by the end of
February, 1992.
13. The minutes of the Borough Council meetings for the period
November 1991 to the present contain no action by council
regarding Werner's hiring.
14. Honesdale Borough records indicate the following Werner
Electric Company invoices were presented to the Borough for
payment for work performed at the Sewer Plant.
Invoice Date
3/30/92
4/8/92
5/6/92
6/3/92
general electric contractor.
Floyd, the daughter of Ralph
Date of Work Amount
3/10/92, 3/11/92
3/18/92, 3/27/92
4/3/92, 4/7/92
4/8/92, 4/9/92
4/10/92, 4/13/92
4/16/92, 4/18/92
4/28/92
$1473.89
$ 249.19
$1969.65
5/6/92, 5/7/92 $1008.99
5/8/92, 5/13/92
Floyd, 93- 052 -C2
Page 5
92
8/2/92
9/4/92
10/5/92
11/4/92
12/3/92
1/6/93
2/3/93
2/3/93
3/2/93
4/5/93
6/8/93
7/8/93
7/8/93
Date of Amount
Payment Paid
4 -14 -92
5 -12 -92
6 -9 -92
8 -11 -92
9 -16 -92
10 -14 -92
11 -10 -92
$1,723.08
$1,969.65
$1,008.99
$ 155.90
$ 54.00
$ 80.55
$ 222.15
5/14/92, 5/26/92
5/28/92, 5/29/92
8/11/92, 9/4/92
9/25/92
10/28/92
11/20/92
12/9/92, 12/10/92
12/15/92, 12/22/92
1/5/93
1/26/93, 1/27/93
1/29/92, 2/2/93
2/19/93, 3/1/93
3/2/93
$ 155.90
$ 54.00
$ 80.55
$ 222.15
$ 156.15
$ 313.50
$ 27.62
$1532.00
$ 359.42
$ 82.83
5/28/93, 6/2/93 $ 248.40
6/4/93, 6/8/93
6/10/93 $ 42.00
6/17/93, 6/18/93 $ 252.90
15. The minutes of the Honesdale Borough Council meetings indicate
Councilman Floyd took the following action in reference to
payments to Werner Electric Company:
Borough Action By Doe of
Check # Floyd On Acid=
Payment To
Werner Elect.
4386 Voted to Approve
4435 Voted to Approve
4468 Voted to Approve
4553 Voted to Approve
4601 Voted to Approve
4640 Voted to Approve
4-13-92
5 -11-92
6-8-92
8-10-92
9-14-92
10 -12-
4678 Voted to Approve 11 -9-92
F o d, 93- 052 -C2
Page 6
92
12 -15 -92 $ 156.15
1 -12 -93
2 -11 -93
2 -11 -93
3 -9 -93
4 -13 -93
6 -15 -93
7 -14 -93
7 -14 -93
Check Number
4386
4435
4468
4553
4601
4640
4678
4717
4750
5752
4783
4824
5878
4929
4965
2220
$ 313.50
$ 27.62
$1,532.00
$ 359.42
$ 82.83
$ 248.40
$ 42.00
$ 252.90
Totals 1992
1993
1992 & 1993
Endorsed
4 717 Voted to Approve 12 -14-
4750 Absent
5752 Voted to Approve
4783 Voted to Approve
4824 Voted to Approve
5878 Voted to Approve
4929 Voted to Approve
4965 Abstained
2220 Abstained
$5,370.47
$2,858.67
$8,229.14
a. The bills listed above were part of a "package" of bills
submitted to council for approval.
16. The checks payable to Werner Electric contain the following
endorsements on the back:
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Werner Electric
Bonnie S. Werner
Bonnie Werner
Bonnie S. Werner
Bonnie S. Werner
Bonnie Werner
Bonnie S. Werner
Bonnie S. Werner
Terry J. Werner
Bonnie S. Werner
Terry J. Werner
Terry J. Werner
Bonnie Werner
Bonnie S. Werner
Terry J. Werner
Terry J. Werner
Terry J. Werner
1 -11 -93
2-8 -93
2-8 -93
3-8 -93
4 -12-93
6 -14-93
7 -12-93
7 -12 -93
17. The checks were deposited into the joint checking account of
Terry J. and Bonnie S. Werner at the Honesdale National Bank.
18. On July 13, 1992 Councilman William Rogers made a motion,
seconded by Councilman Jerome Theobald, to appoint T. J.
Werner as Assistant Borough Electrician at a retainer fee of
$50.00 per month and an hourly rate of $6.25.
19. Councilman Floyd was present at the July 13, 1992 meeting and
Floyd, 93- 052 -C
Page 7
participated in a unanimous vote
20. The payments listed in Finding
relation to Werner's employment
payments which resulted from the
sewer plant.
III. DISCUSSION
As a councilman for the Borough of Honesdale, W ayn C
Ralph T. Floyd, hereinafter Floyd, is a public
term is defined under Act 9 of 1989. 65 P.S. 5402. As such, his
conduct is subject to the provisions of the Ethics Law and the
restrictions therein are applicable to him.
Initially, it is noted that Section 9 of Act 9 of June 26,
1989 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 after the
effective date of Act 9 (June 26, 1989), we must apply
provisions of Act 9 to determine whether the Ethics Act was
violated.
Under Section 3(a) of Act 9 of 1989 quoted above, a public
official /employee shall not engage in conduct that constitutes a
conflict of interest.
The term "conflict of interest" is defined under Act 9 of 1989
as follows:
Section 2. Definitions
to approve hiring Werner.
No. 13 were not made in
with the Borough but were
contract to do work at the
"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
F1- 2Yd, 93- 052 -C2
Page 8
family is associated. "Conflict" or "conflict
of interest" 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
g
includes the public official orup which
employee, a member or his immediate family
a business with which he or a member of his
immediate family is associated. 65 P.S. S402.
In addition, Section 3(f) of Act 9 of 1989 specifically
provides in part that no public official /employee or spouse or
child or business with which he or the spouse or child is
associated may enter into a contract with his governmental body
valued at five hundred dollars or more or any subcontract valued at
five hundred dollars or more with any person who has been awarded
a contract with the governmental body with which the public
official /employee is associated unless the contract is awarded
through an open and public process including prior public notice
and subsequent public disclosure.
The issues before us are whether Floyd, as a Honesdale Borough
Councilman, violated Section 3(a) of Act 9 of 1989, the conflict
provision, and Section 3(f), the contracting provision, regarding
his alleged participation in Council decisions to a pments
to Werner Electric, a company owned by his daughter andoson -in -law.
Floyd served as Honesdale Borough Councilman from the date of
his appointment, April 13, 1992 until March 14, 1994 when he
resigned. In January, 1993 Floyd was appointed Chairman of the
Sanitation Committee wherein he oversaw the operations of the sewer
plant. In a private capacity Floyd is the owner of Walter Electric
company which is a general electric contracting business. Terry
Werner, the son -in -law of Floyd, started Werner Electric Company in
1990 which also performs general electric contract work.
In the
superintendent l of attthe Honesdale Borou hDan
Guinther, the sewer
to perform certain electrical repair work. Consistent with Borough
practice, no other electrical contractors were contacted by
Guinther. Borough Councilman William Rogers who was the Chairman
of the Sanitation Committee informed Werner of the work which the
Borough required at the plant. Werner agreed to do the work at the
hourly rate of $18.00 plus materials.
Although the minutes of Council do not reflect any action to
hire Werner, the records do reflect invoices from Werner Electric
Company which were presented to Borough for payment. The minutes
of Honesdale Borough Council reflect those instances where Floyd
took action to approve payments to Werner Electric Company which
Floyd 93- 052 -C2
Page 9
bills were part of a package of bills submitted to Council.
In applying the provision of the Ethics Law to the instant
matter we find technical violations of both Section 3(a) and 3(f)
of Act 9 of 1989. Regarding Section 3(a), Floyd, as a Councilman,
did use the authority of office in voting to approve payment of
bills by Werner Electric. Such action was a use of authority of
office. See Juliante, Order 809. In addition, the use of
authority of office resulted in a private pecuniary benefit
consisting of the payments received at the hourly rate of $18.00
for the work performed. Lastly, a private pecuniary benefit inured
to a business with which a member of Floyd's immediate family is
associated. The terms business with which associated and immediate
family are defined as follows:
"Business with which he is associated." Any
business in which the person or a member of the
person's immediate family is a director, officer,
owner, employee or has a financial interest.
"Immediate family." A parent, spouse,
child, brother or sister.
65 P.S. 5402.
Thus, since Werner Electric is owned by the son -in -law and daughter
of Floyd, it is clearly a business with which a member of his
immediate family is associated. Hence, in this case, there was a
us fit ar bus ness office
with
which resulted
a member of Floyd's P immedia e
be
efi
family was associated.
We are aware of our decision in Krushinski, Order 168, wherein
we held that a public official who voted to approve invoices of a
business with which he was associated did not violate the Ethics
Law where the invoices were routine and related to preset cost
items. Krushinski is inapposite to the instant matter since the
services Werner performed could not be characterized as routine or
of a preset amount.
We note that Werner was contacted and agreed to perform the
services at a point in time before Floyd was appointed to Council.
Thus, the action of Floyd as to the contracting work by Werner was
limited to voting to approve the Werner Electric Company invoices
for payment. Accordingly, we find a technical violation of Section
3(a) of Act 9 of 1989. Bartorill Order 889.
As to the matter of Section 3(f) of Act 9 of 1989, Werner
Electric Company is a business with which Floyd's daughter is
associated. Werner Electric Company entered into a contract with
the Borough in excess of $500 for certain repair work which
F o d, 93- 052 -C2
Page 10
contract was not awarded through an open and public process.
Therefore, as to the contracts in the amount of $1,969.65,
$1,008.99 and $1,532.00 which occurred during the time that Floyd
was on Council, we find a technical'violation of Section 3(f) of
Act 9 of 1989. Chermak, Order 887. As to such contractin we
note that it was the historical practice of the Borough for�the
superintendent to contact only one electrical contractor without
advertising for bids. Further, the initial contact in this case
was made at a point in time before Floyd was on Council.
Therefore, based upon the totality of facts and circumstances in
this case, we will take no further action.
IV. CONCLUSIONS OF LAW:
1. Ralph T. Floyd, as a Honesdale Borough Councilman, was a
public official subject to the provisions of Act 9 of 1989.
2. A technical violation of Section 3(a) of Act 9 of 1989
occurred when Floyd voted in favor of motions to approve a
list of bills which included invoices for services performed
by a business with which a member of his immediate family was
associated.
3. A technical violation of Section 3(f) of Act 9 of 1989
occurred when contracts in excess of $500 were awarded without
an open and public process to a business with which a child of
Floyd was associated regarding repairs as to the Honesdale
Borough Sewer Plant.
In Re: Ralph T. Floyd File Docket: 93- 052 -C2
Date Decided: 06/23/94
Date Mailed: 06/30/94
ORDER NO. 929
1. A technical violation of Section 3(a) of Act 9 of 1989
occurred when Ralph T. Floyd, as a Honesdale Borough
Councilman, voted in favor of motions to approve a list of
bills which included invoices for services performed by a
business with which a member of his immediate family was
associated.
2. A technical violation of Section 3(f) of Act 9 of 1989
occurred when contracts in excess of $500 were awarded without
an open and public process to a business with which a child of
Floyd was associated regarding repairs as to the Honesdale
Borough Sewer Plant.
3. Based upon the totality of facts and circumstances of this
case we will take no further action.
BY THE COMMISSION,
JAMES M. HO , CHAIR