HomeMy WebLinkAbout946 ZangrilliSTATE ETHICS COMMISSION
308 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
In Re: Armand Zangrilli File Docket: 92- 036 -C2
Date Decided: 09/12/94
Date Mailed: 09/21/94
Before: James M. Howley, Chair
Daneen E. Reese, Vice Chair
Dennis C. Harrington
Austin M. Lee
Allan M. Rluger
The Investigative Division of the State Ethics Commission
conducted an investigation regarding a possible violation of the
State Ethics Law, Act 9 of 1989, P.L. 26, 65 P.S. §401 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 held. The record is complete. 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 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. 5408(h). Any person who violates
confidentiality of the Ethics Law 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. 5409(e). Confidentiality does not
preclude discussing this case with an attorney at law.
Zangrilli, 92- 036 -C2
Page 2
I. ALLEGATIONS:
That Armand Zangrilli, a Plumber Foreman for the Pittsburgh
School District, violated the following provisions of the State
Ethics Act (Act 9 of 1989), when he used the authority of his
position to direct school district business to A & D Mechanical,
Incorporated and ADAM Specialty, Incorporated, businesses with
which he and a member of his immediate family are associated; when
he utilized school district equipment and materials for his private
business purposes; when he failed to file Statements of Financial
Interests for the 1989, 1990 and 1991 calendar years; when A & D
Mechanical and ADAM Specialty contracted with the school district
without an open and public process; and when he used his public
position to order, purchase or requisition various supplies and
materials for the school district from a member of his immediate
family or a business with which he is associated, which materials
and supplies were paid for by the district but never received.
Section 3. Restricted Activities
(a) No public official or public
employee shall engage in conduct that
constitutes a conflict of interest. 65 P.S.
5403(a).
(f) No public official or public
employee or his spouse or child or any
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,
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).
Zanarilli, 92- 036 -C2
Page 3
II. FINDINGS:
Section 4. Statement of financial interests
required to be filed
(a) Each public official of the
Commonwealth shall file a statement of
financial interests for the preceding calendar
year with the commission no later than May 1
of each year that he holds such a position and
of the year after he leaves such a position.
Each public employee and public official of
the Commonwealth shall file a statement of
financial interests for the preceding calendar
year with the department, agency, body or
bureau in which he is employed or to which he
is appointed or elected no later than May 1 of
each year that he holds such a position and of
the year after he leaves such a position. Any
other public employee or public official shall
file a statement of financial interests with
the governing authority of the political
subdivision by which he is employed or within
which he is appointed or elected no later than
May 1 of each year that he holds such a
position and of the year after he leaves such
a position. Persons who are full -time or
part -time solicitors for political
subdivisions are required to file under this
section. 65 P.S. 5404(a).
1. David Donahoe is the Executive Director for Business Affairs
for the School District of Pittsburgh ( "PSD "), having served
in this capacity since July 1, 1991.
a. Donahoe commenced employment with PSD in January, 1991 as
an Assistant Director.
b. Donahoe is also Assistant Secretary to the Pittsburgh
Board of Public Education ( "PBOPE ").
(1) Investigative Division Exhibit 1 is the job
description dated June 30, 1989 for Armand
Zangrilli's former position with the PBOPE as
Plumber Foreman.
(a) Zangrilli's general job responsibilities were
as follows:
"Under the general direction of the Chief
of Maintenance is responsible for the
Zangrilli, 92- 036 -C2
Page 4
direct supervision of the Plumbing Shop
in the maintenance and repair of all
buildings owned and /or occupied (subject
to lease) by the School District, as they
pertain to plumbing."
(b) Zangrilli's typical job duties were as
follows:
"Reviews all work requests assigned to
the plumbers. Assists in establishing
priorities, planning and scheduling jobs.
Directs work requests to Shop and /or
journeymen, as appropriate. Oversees and
assists in the requisitioning and /or
ordering of all equipment, materials and
tools needed, while working in close
harmony with the materials expeditor,
purchasing supervisor, stockroom
supervisor and toolroom attendant. Keeps
accurate records of time and materials
for each work request. Provides
technical support and backup to workmen
as needed. Provides an accurate account
of the workmen's time for the payroll
account clerk, including overtime, sick
days, vacation time, personal days,
accident reports etc. in a timely manner.
Acts as a liaison between the workman and
school administrators as necessary. Make
frequent visits to School District
buildings to review progress and quality
of work. Keeps the Chief of Maintenance
fully informed to any emergency situation
of problems."
(c) Specific job duties for Zangrilli's position
as Plumber Foreman included:
(1) Assist in establishing priorities,
planning and scheduling.
(2) Provide accurate account of payroll for
payroll clerk, sick days, vacation,
personal days, accident reports, etc.
(3) Act as liaison between the tradesmen and
school administrators.
(4) Review progress and quality of work
performed by tradesmen.
Zanarilli, 92- 036 -C2
Page 5
(2) Investigative Division Exhibits 2 -A through 2 -E are
cancelled checks from the PBOPE payable to A&D
dated from August 21, 1989 through March 9, 1992.
(3) Investigative Division Exhibits 3 -A through 3 -D are
cancelled checks from the PBOPE payable to ADAM
dated from October 24, 1990 through March 9, 1992.
(4) Investigative Division Exhibit 4 consists of
cancelled payroll checks of the PBOPE payable to
Armand Zangrilli dated for 1989 through 1992.
(5) Investigative Division Exhibits 5 -A through 5 -F are
attendance reports for the PSD's plumbing shop for
1987 -1992.
c. The Director of PSD's Unit of Purchasing, Dan McConachie,
reports to Donahoe.
(1) Between approximately 1989 and the end of 1992,
McConachie's job duties included responsibility
for:
(a) operating PSD's central purchasing system,
which includes the advertising, receipt, and
opening of bids;
(b) making recommendations to Donahoe, the
Superintendent, and School Board on the awards
for such bids;
(c) personnel who assisted various other units
with procurement;
(d) the issuance of written procedures governing
the purchase and acquisition of supplies and
goods.
(2) The Purchasing Support Manager, Billie Kruse, is
McConachie's Assistant.
(3) The expediters, Neely Earl and Herb Hatfield, are
below Billie Kruse in the chain of command.
(a) Between approximately 1989 and the end of
1992, the duties of the expediters were
generally to work with and to support various
departments in obtaining materials.
(4) Ernie Miller is below the expediters.
Zanarilli, 92- 036 -C2
Page 6
d. The Director of the Facilities Department, which is a
separate department from the Unit of Purchasing, Edward
Preskar, also reports to Donahoe.
e. The Maintenance Division has various trade shops, among
which are the carpentry shop, the electrical shop, the
paint shop, the metal shop, the plumbing shop, and the
steamfitter shop.
g.
(1) The Maintenance Division is headquartered at the
"Service Center."
(2) An inventory of routinely -used items is maintained
for the trades at the Service Center.
(3) Items which are not maintained in inventory are
purchased in the marketplace.
f. It is Donahoe's understanding that between approximately
1989 and the end of 1992, trades foremen had latitude in
purchasing non -bid items under a certain threshold
amount.
(1) The trades foremen were authorized to find the
goods, select a vendor, and to make the order
without anybody else's approval.
(2) Donahoe was not aware of any limit to the total or
aggregate amount of such purchases.
In 1991, after becoming the Executive Director for
Business Affairs for PSD, Donahoe expressed concern to
McConachie as to who could make purchases and under what
rules.
h. PBOPE maintains lists of vendors who ask to receive bid
documents.
i. PBOPE has "Minority /Women Business Participation
Guidelines" for contracts that are bid. (R -3A).
(1) Donahoe states that when Pittsburgh School District
people place an order that is not bid, they are
asked to do whatever they can to meet minority
guidelines.
j PBOPE does not prohibit tradesmen from working on outside
jobs as long as they do not do it during the course of
their working hours at the Board.
(1) There is a School District policy against
Zangrilli, 92- 036 -C2
Page 7
b. Investigative Division Exhibit 28, pages 1 through 615,
is comprised of checks from the PBOPE to ADAM, together
with all supporting documentation for those checks.
(1) Armand Zangrilli's name appears on three of these
Maintenance Materials Requisition Forms on the line
designated, "Requested by." (I.D. 28 -365, 28 -369,
and 28 -434).
2. Daniel Robert McConachie is the Director of Purchasing for the
PSD, having served in this capacity since 1977.
a. McConachie's job responsibilities and duties include
overseeing the purchase of all materials used by the PSD
and coordinating the functions of the warehouse.
c.
Pittsburgh School District employees selling goods
to the School District, even if done on the
employee's own time.
(a) Each of these three forms bears Miller's name
on the line designated "Required approval."
(2) The Maintenance Materials Requisition Forms
labelled I.D. 28 -160 and 28 -162 do not bear the
name "Armand Zangrilli," but do bear the name
"Zang" on the line designated, "Requested by."
(a) Each of these forms has the name "Don" at the
far right of the line designated "Required
approval."
(b) I.D. 28 -162 is also signed by Miller.
Investigative Division Exhibit 29, pages 1 through 1,112,
is comprised of checks from the PBOPE to A&D, together
with all supporting documentation for those checks.
(1) The following Maintenance Materials Requisition
Forms do not bear the name "Armand Zangrilli," but
do bear the name "Zang" on. the line designated,
"Requested by ": I.D. 29 -42, 29 -48, 29 -49, 29 -52,
29 -53, 29 -56, 29 -57, 29 -60, 29 -61, 29 -64, 29 -65,
29 -229, 29-310, 29 -571, 29 -901, and 29 -905.
(a) Of these, I.D. 29 -42 and 29 -310 bear the names
"Charles B. McShane" and "Don" on the
"Required Approval" line.
(b) I.D. 29 -48, 29 -49, 29 -52, 29 -53, 29 -56, 29 -57,
29 -60, 29 -61, 29 -64, 29 -65, 29 -571, 29 -901,
Zanarilli, 92- 036 -C2
Page 8
and 29 -905 all bear the name "Don" at the far
right of the "Required Approval" line.
(1) Of these, I.D. 29 -49, 29 -53, 29 -57, 29-
61, 29 -65, and 29 -57 also bear the name
of "E.B. Miller."
(2) Of these, all but I.D. 29 -49 also bear
the initials of Neely Earl on the far
right of the "Requested By" line.
(c) I.D. 29 -229 does not bear any name on the
"Required Approval" line, but does bear the
name "E.B. Miller" elsewhere on the form.
d. During the relevant period from August, 1989 to January,
1992, ADAM and A&D repeatedly contracted with the PBOPE
for sales of $500 or more, which sales were processed
without prior or subsequent public notification and with
no more than two (2) quotations from other companies.
(See Findings 2f -g).
(1) For many of these sales, no quotations were
obtained.
e. As the Director of the Unit of Purchasing, McConachie had
the authority to issue procedures governing purchasing by
the PBOPE (See Finding 1 (c) (1) (d) ) .
f. From August of 1989 through January of 1992, procedures
for purchasing for the trades of the PSD were specified
in a memorandum dated August 30, 1989 from McConachie to
Charles McShane (I.D. 39).
(1) In all cases except sealed bids, materials were to
be purchased from suppliers located within the City
of Pittsburgh limits.
(2) Individual purchases over $4,000 had to be
purchased through formal competitive sealed bids
advertised in the newspapers.
(a) For these items, the only role of the
tradesman or trades foreman was to specify
what items were needed.
(3) Purchases from $2,500 up to $4,000 required at
least three written price quotations, to be
obtained by the buyers.
(a) Purchases over $2,500 required the approval of
Zanarilli, 92- 036 -C2
Page 9
g•
I
Billie Kruse (formerly Billie Talak) or
McConachie.
(4) Purchases from $1,000 up to $2,500 required one
written price quotation.
(a) A tradesman could get the price quotation.
(b) It was within Zangrilli's authority to get a
price quote.
(5) Purchases under $1,000 did not require any written
price quotation.
(6) Purchases under $1,000 did require the signature of
the trades foreman or Chief of Maintenance
authorizing the "direct purchase" of the items
specified. (I.D. 39 -4).
(7) McConachie does not know if McShane distributed
copies of the memorandum of August 30, 1989 to
tradesforemen and tradesmen.
From August of 1989 through January of 1992, the
procedures for requisitioning materials also depended
upon the dollar amount of the purchases.
(1) For items over $1,000 in price, a separate
requisition and purchase order was to be initiated.
(2) For items under $1,000 in price, purchases for
tradesmen were applied against "open purchase
orders" which had been established for each of the
trade categories.
(a) An "open purchase order" is a document by
which a significant amount of money is
encumbered within PSD's financial system to be
used for purchasing unspecified supplies for
tradesmen over a designated period of time.
Items below the $1,000 threshold could be purchased in
one of the following two ways:
(1) The item could be requisitioned in advance, with
the tradesman contacting an individual in the
Facilities Office to prepare a Maintenance
Materials Requisition Form and submit it to a buyer
in the Purchasing Office.
(a) The tradesman could recommend a vendor which
Zanarilli, 92- 036 -C2
Page 10
would be indicated on this form.
(b) The buyer would not be required to use any
recommended vendor.
(2) A tradesman could pick up the needed item from the
vendor himself and either simultaneously contact
the Purchasing Office to get a release number, or
submit a packing slip after the purchase was made
to either the Facilities Office or the Purchasing
Office to get a Maintenance Materials Requisition
Form prepared to support the purchase.
(a) The tradesman had total latitude to select
vendors for purchases in the field below the
$1,000 threshold.
(b) There was no limit upon the aggregate number
of purchases below the $1,000 threshold that a
tradesman could make in the field.
(c) There was no aggregate limit upon the total
dollar amount expended by a tradesman for
purchases below the $1,000 threshold.
i. The middle section of the Maintenance Materials
Requisition Form is used to request items kept in
warehouse stock, while the lower portion labelled
"description- direct purchase" is used to purchase items
that are not maintained in warehouse stock from vendor
companies, if the items are less than $1,000.
Each Maintenance Materials Requisition Form is assigned
a number known as a "purchase order number."
(1) The first part of a "purchase order number" is the
number of the purchase order that was used to
encumber the bulk amount of money being accessed,
while the second part (appearing after the letters
"RR ") is the "release" number.
(2) A purchase being charged against an open purchase
order is not paid for unless a release number is
issued.
(3) The release number is a three -digit number, and
indicates the numerical sequence of the particular
purchase against the open purchase order during the
calendar year.
(4) Release numbers are assigned sequentially beginning
Zanarilli, 92- 036 -C2
Page 11
with 001 and increasing in increments of one.
(5) When the number of the purchase order is combined
with the release number, the result is a number
which should never be duplicated.
(6) The release number is to be given to the vendor so
that it appears on the invoice.
(7) The release number should also be put on the
packing slip.
(a) A packing slip is a document which indicates
that goods have been received from a vendor.
(8) A log is maintained which assigns the release
numbers.
k. Nealy Earl and Herb Hatfield are the expediters who
operate at the Service Center.
(1) Although Nealy Earl and Herb Hatfield did assign
release numbers in the log books, the books are
accessible to other people who might need to
identify a release number, such as Ernie Miller,
Don Rase, Billie Kruse, and McConachie.
(2) McConachie would ordinarily not play any role in
purchases under $1,000 during the relevant period.
(3) Kruse coordinates the clerical staff at the Service
Center and performs some buying responsibilities,
but has nothing to do with any of the tradesmen or
trade shops.
1. Don Rase is a Materials Expediter in the Facilities
Office.
(1) Rase's main responsibility is to prepare
Maintenance Material Requisition Forms.
(2) Rase can issue releases against open purchase
orders.
(3) Rase cannot issue a purchase order for the School
District, although Earl and Hatfield can do so.
m. During the relevant period from August of 1989 to January
of 1992, the Maintenance Materials Requisition Form was
required to be signed by either the trades foreman or the
Chief of Maintenance.
Zanarilli, 92- 036 -C2
Page 12
n. Respondent's Exhibit 7 is McConachie's memorandum
recounting the investigation of Zangrilli's relationship
to A&D and ADAM.
q.
(1) As the plumber foreman, Armand Zangrilli had the
authority to sign Maintenance Materials Requisition
Forms to authorize purchases.
(1) The PBOPE stopped all business dealings with A&D
and ADAM on or about December 27, 1991, while the
matter was investigated.
(2) On or about January 3, 1992, McConachie and Billie
Kruse reviewed PBOPE files to determine whether the
signatures of trades foremen were on Maintenance
Materials Requisition Forms in the files.
(a) In many cases, the appropriate signatures were
on the forms, but for the majority of
requisitions for materials from A&D and ADAM,
the signatures were not on either packing
slips or requisitions. (R -7).
(b) For those items with which Ernie Miller and
Mr. Baxter were dealing, it was their
responsibility to make sure that the
signatures were on the requisitions.
o. The Purchasing Division operates a warehouse of supplies
for the maintenance trades which is coordinated by Ernie
Miller.
(1) Ernie Miller initiates requests to replenish
warehouse stock.
(2) Warehouse stores are purchased by requisition under
McConachie's signature under a revolving fund.
(3) McConachie signed requisitions for several
purchases from A&D and/or ADAM.
A purchased item that is not a part of warehouse stores
never goes into the warehouse stores.
(1) If the item is delivered to the warehouse it is
forwarded to the shop where the tradesmen work.
Invoices for purchases go directly to finance for
payment.
(1) A payment by the Finance Office is initiated by the
Zangrilli, 92- 036 -C2
Page 13
matching of an invoice with the signed packing slip
as verification of receipt.
(2) The Finance Office creates its own log of release
numbers from the invoices which that office pays.
(3) McConachie does not control the Finance Office.
r. The Purchasing Department is audited by the Controller's
Office for the City of Pittsburgh and to some extent
external auditors.
(1) Items outside of the warehouse stock, such as in
the trade cages, are neither controlled by
purchasing nor audited.
(2) For the most part, the auditors look only at a very
small portion of what is in the warehouse stock.
s. Investigative Division Exhibit 29 -43 is a proposal from
A&D to the PBOPE for a Raypack W2824 Modulating Water
Heater in the amount of $3,250.00.
(1) The proposal indicates that the individual who
obtained the quote on behalf of the School District
was "A. Zangrilli" at telephone number 488 -5109.
(a) There is no "A. Zangrilli" working for the PSD
other than Armand Zangrilli.
t. PBOPE does not preapprove vendors.
(1) A vendor is assigned a vendor number when the
vendor first sells an item to PBOPE or asks to be
added to a vendor list.
u. For materials under $1,000, A&D and ADAM were not
entitled to preferential treatment under the School
District's policy for minorities.
(1) The School District's policy refers to sealed bid
documents and specifically relates to items over
$4,000.00.
v. The PSD has an informal policy regarding purchasing from
Pittsburgh Area suppliers.
(1) The policy is set forth in the memo of August 30,
1989 from McConachie to McShane. (See Finding 2f).
(2) The minority /women policy adopted by the Board
Zangrilli, 92- 036 -C2
Page 14
which applies to bids does not require that the
business be located in the City.
w. In addition to plumbing supplies, steamfitter's supplies
were purchased by the PBOPE from A&D and ADAM (R -6).
3. Bradley A. Graham is employed by Service Master as Director of
Building Grounds and Transportation for Service Master's
Conneaut Lake, Pennsylvania location.
a. Service Master has a contract with the Conneaut School
District to run the School District's maintenance,
custodial and transportation departments.
b. From approximately 1989 through 1991, Service Master did
business with A&D.
c. Graham's contacts with A&D were with Armand Zangrilli.
(1) Graham recognizes Armand Zangrilli.
(2) Graham's dealings with Armand Zangrilli in relation
to A&D were in making purchases, requests for
materials, and discussing projects on which Graham
wanted Zangrilli to quote.
(a) On one occasion when Graham needed a certain
part, Zangrilli stated that "they" had used
that at the Pittsburgh City School District.
(3) In the course of Graham's dealings with A&D, Graham
did not deal with any representative of A&D other
than Armand Zangrilli, on a personal, face -to -face
basis.
d. When Graham needed materials from A&D, he would contact
A&D either by leaving a message on A&D's answering
machine or by direct contact with Armand Zangrilli.
(1) Armand Zangrilli would meet with Graham in response
to Graham's telephone calls to A&D.
(2) Graham does not know Donna Luke.
(3) Graham never met Donna Luke.
(4) When Graham contacted A&D by telephone, it was at a
local telephone number within the Conneaut Lake
area.
(5) The answering machine recording was a female voice.
Zangrilli, 92- 036 -C2
Page 15
e. Investigative Division Exhibit 14 consists of the
invoices from A&D that Graham reviewed as a
representative of Service Master.
f. Investigative Division Exhibit 14A consists of the
Conneaut Lake School District's payments to A&D and a
related deposit slip for A&D's account at Marine Bank.
(1) The payments are dated from 11/08/89 through
03/13/91.
(2) The payments total $2112.25.
4. John Patrick Dyer is employed by the PEOPE as the Chief of
Maintenance, having served in that capacity since July 1,
1991.
a. As Chief of Maintenance, Dyer's job duties and
responsibilities include working directly with the trades
foremen in applying work requests to the appropriate
tradesmen, and in directing and guiding the tradesmen on
various projects.
b. As Chief of Maintenance, Dyer was Armand Zangrilli's
supervisor.
c.
(1) Dyer's predecessor was Charles McShane.
Dyer is not familiar with the purchasing procedures which
existed before Dyer became Chief of Maintenance in 1991,
as to materials for tradesmen under $1,000.
d. Dyer states that Miller and Rase approved requisition
forms to expedite getting materials to the job site.
e. Dyer states that Donna Luke was sales representative for
A&D.
(1) Dyer states that he did not observe Zangrilli
marketing or representing A&D or making deliveries
for A&D or ADAM.
(2) Dyer states that Zangrilli did not ask Dyer to
direct a particular purchase to A&D.
f. Dyer did not know that Armand Zangrilli and Donna Luke
were husband and wife until after Zangrilli had retired
from the PBOPE.
(1) Dyer was informed of the marriage by a Special
Investigator for the State Ethics Commission in
Zanarilli, 92- 036 -C2
Page 16
g-
December, 1992.
When allegations surfaced regarding whether items the
School District ordered from A&D and ADAM had ever been
delivered and installed, Dyer's inquiry was limited to
checking on three or four parts, which he found.
5. Donald Boyd is a resident of Meadville, Pennsylvania.
a. Boyd contacted A&D to install a new furnace and air
conditioner in his home.
(1) Armand Zangrilli came to Boyd's house to give Boyd
an estimate for the work.
b. Boyd received a written proposal from A&D for the work.
(I.D. 9 -1) .
(1) The written proposal indicates that it was
submitted to Boyd by A&D "Per A. Zangrilli & D.
Luke."
(2) There are two signatures which appear in the
"Acceptance of Proposal" block, Boyd's and
Zangrilli's (See Finding 41 mm(3) (c)) .
c. Armand Zangrilli installed the furnace.
d. Armand Zangrilli signed at least one of the two invoices
Boyd received from A&D (I.D. 9 -2, 9 -3).
(1) The invoice dated February 18, 1992 bears Armand
Zangrilli's signature, as well as a signature of
the name "Donna Luke" followed by the word "owner"
(See Finding 41 mm(3) (d)) .
(2) The invoice dated March 30, 1992 bears the
handwritten notation "Paid in full" followed by the
signature of the name, "Armand Zangrilli."
(a) Luke's name does not appear on this invoice.
e. Boyd paid for the work with checks payable to A&D (I.D.
10) .
(1) These payments were deposited into A&D's account at
Marine Bank. (I.D. 10).
6. Donald J. Rase is employed by the PBOPE as a materials
expeditor, having served in that capacity since January, 1982.
Zangrilli, 92- 036 -C2
Page 17
b. Rase's job duties include preparing paperwork to
requisition materials from the stockroom, and preparing
Maintenance Materials Requisition Forms for the
acquisition of materials and supplies by tradesmen.
(1) Rase was not specifically authorized to issue
release numbers, but he did so for expediency.
c. A tradesman may acquire materials under $1,000 by calling
Rase and ordering materials in advance, in which case
Rase completes the paperwork and submits it to the
Purchasing Department for acquisition.
(1) Tradesmen have the authority to recommend a
particular vendor for a purchase.
(2) It was a frequent practice for tradesmen to make
such recommendations of vendors.
(3) Rase states that Earl or Hatfield could use any
vendor that provided the best price.
d. The past practice has also been for tradesmen to purchase
materials under $1,000 on their own, with the Maintenance
Materials Requisition Form being subsequently completed.
e. Maintenance Materials Requisition Forms often indicate
the name of a company in the description column of the
Form.
g•
a. Rase reports to the Chief of Maintenance.
(1) That company would be the suggested vendor.
(2) The recommendation as to which vendor should be
used for a purchase could be made by the tradesman
or by Rase.
f. As a Plumber Foreman, Armand Zangrilli approached Rase to
obtain materials and supplies.
Armand Zangrilli recommended to Rase that A&D be used to
obtain materials and supplies for the PHOPE.
h. Rase used the word "Zang" on the Maintenance Materials
Requisition Forms to refer to Armand Zangrilli.
i. For Maintenance Materials Requisition Form number 329674
(I.D. 28- 160/162), on which Rase indicated "Zang" as
Zangrilli having requested the materials which were
ordered from ADAM, Rase stated, "It is a very good
Zangrilli, 92- 036 -C2
Page 18
j
possibility I might have gotten (ARAM's] name from Mr.
Zangrilli."
Rase prepared Maintenance Materials Requisition Form No.
320859 (I.D. 29 -42), dated 08/17/89, ordering a "Ray Pak
W2824 Modulating Water Heater" priced at $3,250.00.
(1) Rase indicated on the Form that Zangrilli requested
that this water heater be purchased. (I.D. 29 -42).
(2) The recommended vendor was A&D.
(3) Rase obtained the vendor's name from a proposal
which A&D had submitted (I.D. 29 -43).
(a) Zangrilli is indicated as having requested
each of these orders.
(b) A&D Mechanical Supplies, Inc. submitted the
Proposal (I.D. 29 -43) dated 08/17/89 to the
PBOPE for one Ray Pak W2 -824 Modulating Water
Heater for the price of $3,250.00.
(4) A&D's proposal indicates that Zangrilli received
the proposal on behalf of the School District.
(a) The telephone number next to Zangrilli's name,
488 -5109, is the telephone number of
Zangrilli's office at the PBOPE.
(b) Rase did not instruct Luke to submit the
proposal in this format.
(1) Rase never had occasion to ask vendors to
submit proposals in a particular way.
k. Zangrilli recommended to Rase that the PBOPE purchase
Model S25 Armstrong pumps from A&D.
(1) Zangrilli stated that he wanted to switch to
Armstrong pumps.
(2) Zangrilli stated that A&D could get Armstrong pumps
"cheaper and quicker ".
(3) Rase prepared five (5) Maintenance Materials
Requisition Forms dated September 1, 1989 which
purchased from A &D the exact make and model of
Armstrong pumps for which Zangrilli had recommended
A &D. (I.D. 29- 48/49, 52/53, 56/57, 60/61, 64/65).
Zangrilli, 92- 036 -C2
Page 19
(a) Zangrilli is indicated as having requested
each of these orders.
(a) These five (5) particular pumps cost the PBOPE
$1,130.00.
1. Rase prepared a Maintenance Materials Requisition Form
dated June 18, 1990 for the purchase of a trailer by the
School District. (I.D. 29 -571).
(1) This purchase was requested by Zangrilli.
(2) Rase states that the purchase order number, price,
and Nealy Earl's initials are not in Rase's
handwriting.
(3) The recommended vendor, A&D, is in Rase's
handwriting.
(a) Rase got this information for this Requisition
from Zangrilli.
(b) Zangrilli told Rase that this was the trailer
he wanted and that A&D could get it quickly
and cheaply.
(4) This trailer was purchased from A&D at the price of
$985.00 (I.D. 29 -569, 29 -571).
(a) A vendor invoice by which A&D acquired this
trailer has not been identified.
m. Rase was not aware that Zangrilli was married to Donna
Luke, the owner of A&D.
(1) Rase thought that Zangrilli and Luke were close
friends.
n. Rase signed his name on Maintenance Materials Requisition
Forms for the purpose of recording the fact that he had
prepared them.
(1) Rase signed Maintenance Materials Requisition Forms
on the right of the "Required Approval" line with
the name "Don."
(2) After Rase signed the form, it went to Nealy Earl
for ordering.
(3) Neither Rase nor the Facilities Department approves
purchases or payments.
Zangrilli, 92- 036 -C2
Page 20
P
q.
(4) Rase states that the Purchasing Department approves
payments of bills.
o. Rase testified that in order for a part to be procured,
the Maintenance Materials Requisition Form must be signed
by someone from the Facilities Office and someone in the
Purchasing Department.
(1) A purchase could be made without the appropriate
signatures if the Purchasing Department issued the
purchase order number to the tradesman.
(2) Rase states that no payment would be obtained
without the packing slip or some proof being given
to the Purchasing Department indicating delivery
of the goods.
Rase states that Donna Luke was at the Service Center
frequently.
(1) Luke told Rase what products could be supplied.
Dyer did not tell Rase to utilize A&D and ADAM.
r. Rase states that McShane told Rase to utilize A&D and
ADAM.
(1) Rase states that he was instructed by McShane,
before even the first purchase, that he was to use
A&D as much as possible, because "she" was a
female, minority, and had a family to raise.
(2) Rase states that the School Board's policy to
encourage the use of minority /female businesses to
fill orders applied to bids and to purchases under
a thousand dollars.
s. Rase stated that whether Zangrilli was involved with A&D
or not, he would have handled things in the same manner.
t. Rase states - that prior to early 19 92, it was Board_ policy
that any tradesman could sign the request line on the
Maintenance Materials Requisition Form.
(1) Rase states that after early 1992, the foremen's
signature was required.
u. Rase states that on occasion, he determined that supplies
from A&D and ADAM were cheaper than from other vendors.
(1) Rase was happy with the service received from A&D.
Zangrilli, 92- 036 -C2
Page 21
(2) Rase states that A&D delivered orders quickly.
7. Thomas A. Motley is employed as the Director of Plant
Operations for PBOPE.
a. Motley knows Armand Zangrilli from the PBOPE.
b. In 1992, A&D performed air conditioning and furnace work
for Motley at various residential properties.
(1) Motley contacted Zangrilli about the work to be
done.
(2) Zangrilli looked at the job and gave Motley
estimates for the work.
(3) A&D billed Motley for the work (I.D. 7).
(a) The address indicated for A&D was in Conneaut
Lake.
(4) When a problem developed with the furnace that had
been installed, Motley dealt with Zangrilli.
(a) Motley's contact with Zangrilli resulted in
corrective work being performed.
(5) In dealing with A &D, Motley primarily dealt with
Armand Zangrilli.
(6) Motley paid for the work by checks payable to A&D.
(I.D. 8) .
(a) The checks were deposited to A&D's account at
Marine Bank, account number 1011 -0058 (I.D.
8) .
(b) Armand Zangrilli's name does not appear on the
checks.
(7) Zangrilli gave Motley receipts for his payments.
8. Michael Luke is the son of Donna Luke.
a. Michael Luke has a brother named Anthony.
b. Armand Zangrilli was Michael Luke's stepfather.
c. For seven to eight years, Michael Luke resided with
Armand Zangrilli, together with Donna Luke and Anthony
Luke.
Zangrilli, 92- 036 -C2
Page 22
g-
d. From 1985 to approximately 1989 the Lukes and Armand
Zangrilli resided in one part of a duplex in Pittsburgh.
(1) The duplex was owned by Theresa Zangrilli, who is
Armand Zangrilli's mother. (I.D. 27).
(2) Theresa Zangrilli resided in the other part of the
same duplex.
(3) The duplex was at the corner of two intersecting
avenues, namely Knowlson and Dorchester.
(4) The address of Theresa Zangrilli's part of the
duplex was 2899 Knowlson Avenue.
(5) The address of the other part of the duplex was 537
Dorchester Avenue.
e. Subsequently, the Lukes and Armand Zangrilli resided in
Conneaut Lake, Pennsylvania.
(1) Conneaut Lake was the residence at the time
Zangrilli married Donna Luke.
(2) Zangrilli was at the Conneaut Lake residence on a
regular, daily basis.
(3) Zangrilli slept and ate at the Conneaut Lake
residence.
(4) The street address for the Conneaut Lake residence
was R.D. #1, Oakmont Drive, Conneaut Lake,
Pennsylvania.
(a) No mail came to the street address.
(b) The mailing address was a post office box in
Conneaut Lake, Pennsylvania.
f. Michael Luke was told that the initials in A&D's name
stand for "Armand and Donna ".
The main location for A&D was Conneaut Lake.
(1) Sometimes, but not all of the time, A&D operated
out of the duplex on the corner of Dorchester
Avenue and Knowlson Avenue in Pittsburgh.
h. ADAM was operated out of Conneaut Lake.
i. The initials in the company name "ADAM" stand for the
Zangrilli, 92- 036 -C2
Page 23
j
first initials of the members of the Zangrilli /Luke
family, specifically "Armand ", "Donna ", "Anthony ", and
"Michael ".
(1) The use of these initials for the company name was
Michael Luke's idea.
Michael Luke helped in performing plumbing services for
A&D.
(1) When Michael Luke worked for A&D, he worked with
Armand Zangrilli.
(a) Armand Zangrilli was in charge of the jobs.
(2) Other employees were used irregularly, on bigger
jobs.
k. Armand Zangrilli accepted payments for A&D.
(1) Michael Luke observed A&D's customers giving
payments directly to Armand Zangrilli.
1. Michael Luke was present when Armand Zangrilli picked up
materials from vendors for A&D.
m. Zangrilli had a plumbing company when he met Donna Luke.
(1) Some plumbing parts for Zangrilli's plumbing
business were sometimes stored at the
Dorchester Avenue property.
9. Catherine Murlis resides at 1530 Green Tree Road, Pittsburgh,
Pennsylvania.
a. Murlis owns a cottage in Conneaut Lake, Pennsylvania.
b. Murlis received a circular in the mail from A&D regarding
services available for cottage owners (I.D. 12A).
c. In the spring of 1990, Murlis telephoned A&D at the
telephone number on the circular ftom A&D.
(1) A female individual who identified herself as
"Donna" spoke to Murlis.
(a) The female individual seemed to Murlis to know
what Murlis was talking about when Murlis
explained the cottage's problems.
(2) As a result of Murlis' telephone calls to A &D,
Zangrilli, 92- 036 -C2
Page 24
Armand Zangrilli met with Murlis and looked at the
damage.
d. Armand Zangrilli told Murlis that he was able to repair
the damage at Murlis' cottage.
(1) Zangrilli gave Murlis a price quote for doing the
work.
(2) Zangrilli was to do the work on weekends or
whenever he could, by fitting it into his schedule.
(3) Murlis was not physically present when the work was
done.
e. A&D billed Murlis for the work (I.D. 11).
f. Murlis paid for the work with checks payable to A&D (I.D.
12) .
(1) These payments were deposited into A&D's account at
Marine Bank, account number 1011 -0058 (I.D. 12).
(2) Zangrilli's name does not appear on these checks.
10. David Imhoff is a foreman custodian for the PBOPE.
a. Imhoff asked Armand Zangrilli to install a furnace in his
home.
(1) At that time, Imhoff was not aware of A &D.
b. Zangrilli looked at the job and gave Imhoff a verbal
estimate for the work.
c. Zangrilli told Imhoff to pay Zangrilli $875 for the
furnace.
(1) Imhoff gave Zangrilli a check for $875 for the
furnace.
(2) The furnace was delivered to Imhoff by the furnace
company.
d. Zangrilli installed the furnace, assisted by a woman
named "Donna ".
e. After the furnace was installed, Imhoff gave Zangrilli
$300 in cash for the installation.
f. Subsequently, Imhoff asked Zangrilli for a receipt.
Zanarilli, 92- 036 -C2
Page 25
(1) The receipt (I.D. 13) is from A&D and bears the
notation, "Paid in full" signed "Donna G. Luke."
11. Neely Earl is employed as an expediter by the PBOPE, having
served in that capacity for approximately 20 years.
a. Earl's job duties include purchasing material for the
carpenters, plumbers and steamfitters.
(1) Herb Hatfield is primarily responsible for
purchasing for the other trades, although Earl at
times purchases for the other trades also.
(2) Earl states that Don Rase purchases at times, but
it is not his primary responsibility.
(3) Earl's immediate supervisor is Billie Kruse.
b. Purchases of materials under $1,000 for the trades do not
require formal bidding.
(1) Such a purchase may be initiated by Don Rase
filling out a Maintenance Materials Requisition
For for materials requested by the tradesmen.
(a) No one else but Don Rase is responsible for
filling out these Forms.
(1) Earl states that three or four years ago,
Ernie Miller also played a role in
filling out these forms.
(b) Under this procedure, tradesmen are authorized
to recommend a vendor for a purchase, but can
not force the use of that vendor.
(2) A trades foreman or a tradesmen may directly make
purchases from vendors, before any paperwork is
actually completed.
c. Earl states that prior to January, 1992, the tradesmen
could sign the Maintenance Materials Requisition Form on
the "Requested By" line.
(1) Earl states that after January, 1992, the foremen
had to sign the "Requested By" line.
d. Under normal procedures, Earl would receive a Maintenance
Materials Requisition Form after Don Rase had completed
it.
Zanarilli, 92- 036 -C2
Page 26
(1) The form would come to Earl for Earl to get a price
or to put a purchase order number on the form.
(2) If an item had already been picked up, Earl would
telephone the vendor to confirm the price.
e. Each trade has its own fund from which purchases are
paid, which is indicated by a "purchase order number."
(1) These numbers are changed once a year.
f. Earl is primarily responsible for giving the "RR" number
out in relation to the plumbers, carpenters and steam
fitters.
(5) Earl did not have the authority to question how
another individual assigned release numbers.
(6) Tradesmen cannot give out "RR" numbers.
(7) Earl never saw Zangrilli assign release numbers.
Earl states that Rase asked Earl to use A&D and /or ADAM.
(1) Earl states that Rase asked Earl to put A&D and /or
ADAM on the vendor list.
(2) Vendors could be added to the vendor list without
any authorization.
(3) ADAM and A &D were on Earl's vendor list.
h. Armand Zangrilli recommended A &D and /or ADAM to Earl for
purchases.
(1) If these companies had not been recommended to
g•
(1) Each trade has its own logbook to record "RR"
numbers.
(2) These logbooks are kept in an office occupied by
Earl and Hatfield.
(3) Respondent's Exhibit 5 is a sample of pages from a
logbook for release numbers.
(4) "RR" numbers can be given out by Billie Kruse, Herb
Hatfield, Ernie Miller, Don Rase and Earl.
(a) Hatfield's duties require him to be out of the
building frequently.
Zangrilli, 92- 036 -C2
Page 27
(2) Earl did not discuss pricing with Zangrilli.
i. Earl states that Rase and Zangrilli introduced him to
Luke.
Earl, Earl would not have sought them out on his
own.
(1) Earl did not know that Zangrilli and Donna Luke
were husband and wife.
Donna Luke was represented to Earl to be the owner of A&D
and ADAM.
(1) Earl's dealings with A&D and ADAM were with Luke.
k. Maintenance Materials Requisition Forms numbered 334678
(I.D. 28 -609), 321112 (I.D. 29 -53), 321111 (I.D. 29 -57),
321110 (I.D. 29 -61), 321113 (I.D. 29 -65), 328971 (I.D.
29 -571) , and 330367 (I.D. 29 -901) bear Earl's initials in
the lower right -hand corner.
(1) Earl placed his initials on these forms for the
purpose of giving the "RR" number, except for Form
number 330367 (I.D. 29 -901).
(a) This Maintenance Materials Requisition Form
bears the name "Don" on the right of the
"Required approval" line; the name "Zang" on
the "Requested by" line; and the initials of
Nealy Earl.
(b) Earl stated that he could not give an "RR"
number to Form number 330367 (I.D. 29 -901)
until it was approved by Billie Kruse, because
of the amount of money involved, specifically
$2,528.00.
(1) This Maintenance Materials Requisition
Form does not bear Kruse's initials to
approve it.
(c) A&D's proposal for this item indicates that it
was submitted to the Board at telephone
numbers "488 -5109 488- 5100."
(1) 488 -5109 is the number for Zangrilli's
office at the PBOPE.
(2) On all of these forms, except for I.D. 28 -609 and
I.D. 29 -901, the only handwriting which is Earl's
Zangrilli, 92- 036 -C2
Page 28
is the "RR" number and his initials.
(3) Earl did not play any role in pricing any of these
orders from A&D and ADAM, except for the Forms
numbered 330367 (I.D. 29 -901) and 334678 (I.D. 28-
609) .
(a) On I.D. 29 -901, the price is in Earl's
handwriting.
(b) On I.D. 28 -609, the delivery date, price, and
address are in Earl's handwriting.
1. Investigative Division Exhibit 28 -A is a listing of one
hundred twenty -three (123) Maintenance Materials
Requisition Forms for purchases from ADAM, and one (1)
invoice /packing slip from ADAM to the PBOPE.
(1) None of these documents contain Earl's signature,
name or handwriting.
(2) Earl did not play any role in the purchase or
acquisition of the materials represented on the
documents enumerated on I.D. 28 -A.
(3) Under the purchasing procedures that existed from
1989 to January of 1992, Earl would normally have
played a role in processing these purchases.
(4) Only seven (7) of these forms bear any signature or
name on the lines at the bottom of the Form
designated, "Requested By" and "Required Approval ":
331912 (I.D. 28 -434, I.D. 28 -369); 331941 (I.D. 28-
365); 331911 (I.D. 28 -361); 331903 (I.D. 28 -353);
331878 (I.D. 28 -332); 329674 (I.D. 28 -160); and
327874 (I.D. 28 -117).
(a) Earl states that it is extraordinary that many
of these forms did not indicate that someone
requested them and only bore Miller's
signature.
(b) The name Armand Zangrilli appears on the
"Requested By" line on three of these Forms,
the Requisitions numbered 331912 (I.D. 28 -369,
I.D. 28 -434) and 331941 (I.D. 28 -365).
(c) The name "Zang" appears on the "Requested By"
line on one form, the Requisition numbered
329674 (I.D. 28 -160).
Zangrilli, 92- 036 -C2
Page 29
(1) Around the Service Center, Armand
Zangrilli was called "Armand" and "Zang ".
(d) The other three forms do not bear the name
"Armand Zangrilli" or "Zang ".
(e) Earl states that on the forma numbered 331911
(I.D. 28 -361) and 331941 (I.D. 28 -365), the
vendor's name (ADAM), is in Ernie Miller's
handwriting.
(5) The other document listed on I.D. 28 -A is I.D. 28-
613 which is an invoice or packing slip.
(a) I.D. 28 -613 bears various signatures,
including a signature of the name Armand
Zangrilli.
m. Investigative Division Exhibit 29 -A is a listing of 218
Maintenance Materials Requisition Forms for purchases
from A&D.
(1) None of these documents contains Earl's signature,
name or handwriting.
(2) Earl did not play any role in the purchases
represented by the documents enumerated on I.D. 29-
A .
(3) Only one of these forms bears any signature or name
on the lines designated "Requested By" and
"Required Approval ".
(a) This one form (I.D. 29 -229) has the name
"Zang" on the "Requested By" line.
(b) On one other Requisition, number 331490 (I.D.
29 -947), Miller's name appears twice.
(c) Earl states that it is extraordinary that many
of these forms did not indicate that someone
requested them and only bore Miller's -
signature.
n. Earl had the authority to question irregularities in
Maintenance Materials Requisition Forms.
(1) Earl had the authority to question Forms which did
not meet pricing or quoting requirements.
(2) The submission of multiple Maintenance Materials
Zanarilli, 92- 036 -C2
Page 30
q.
Requisition Forms for the same item from the same
vendor on the same date totalling over $1,000 would
be a procedural deviation that would authorize Earl
to stop processing the forms and to question them,
even if different trade groups were indicated.
(3) If the same items are purchased for different
schools, a separate form must be used for each
school.
o. Earl is not aware of Armand Zangrilli delivering
materials on behalf of A&D or ADAM.
p. Earl was aware that the PBOPE had a policy to encourage
purchasing from female and minority vendors.
Earl occasionally compared the prices of A&D to other
vendors, and sometimes found them to be lower.
(1) A&D and ADAM had good delivery time.
12. Lyle David Schaef is the owner and publisher of a weekly
newspaper publication known as "The Community News," which is
circulated in the western third of Crawford County,
Pennsylvania.
a. The front page of the September 5, 1989 edition of the
Community News featured a picture of Armand Zangrilli and
Donna Luke with two columns under the caption, "A&D
Mechanical Opens. (I.D. 15).
(1) Armand Zangrilli telephoned Schaef and asked him to
do a story on the opening of A&D.
(2) Schaef met with Armand Zangrilli and Donna Luke at
the Conneaut Lake residence on Oakmont.
(3) Schaef photographed Zangrilli and Luke, and Schaef
wrote the article with the information given to him
by Zangrilli and Luke.
(4) The article regarding A&D's oi5ening contains the
following information about Armand Zangrilli:
"Zangrilli has worked in the plumbing business
in the Pittsburgh area for over 25 years and
is knowledgeable in plumbing systems of all
types including installation of new systems
and repairs to existing systems, domestic
water systems, and control work as well as in
estimating, ordering, and layout work."
Zangrilli, 92- 036 -C2
Page 31
(5) The article refers to the individuals in the
photograph as "owner Donna Luke and Armand
Zangrilli."
(6) The article states, "A&D is located off Oakmont
Drive, Conneaut Lake. They may be reached at 814-
382- 4141 -24 hours a day ".
b. A&D has placed paid advertisements in The Community News.
(1) At the time Schaef met with Zangrilli and Luke to
photograph them for the September 5, 1989 article,
Zangrilli and Luke jointly discussed with Schaef a
paid advertisement for A&D which appeared in that
same edition.
(2) For other advertisements that were placed by A&D, a
salesman, not Schaef, made the calls.
(3) A&D pays for the advertisements by checks signed by
Donna Luke.
c. Schaef is a director on the Conneaut School Board, having
served in that capacity since 1984.
(1) Schaef is President of the Board and has served in
that capacity several terms.
(2) Armand Zangrilli telephoned Schaef and asked Schaef
how A&D could start doing business with the School
District.
(a) Schaef referred Zangrilli to Graham (See
Finding 3).
(3) Schaef has seen A&D on the list of bills for the
School District.
a. For orders that did not have a purchase order number, F &L
would designate on the invoice the name of the person who
ordered the item.
13. Cathy Fabian was formerly affiliated" in an ownership and
working capacity with an entity known as F &L Pump Service Inc.
(F &L), having typed invoices and taken orders for that company
• for eighteen years until it went out of business on June-25,
1993.
b. A&D was a customer of F &L.
c. Investigative Division Exhibit 16 consists of the records
Zangrilli, 92- 036 -C2
Page 32
d.
of the business dealings between F &L and A&D (I.D. 16).
(1) Armand Zangrilli is indicated as having placed each
of A&D's orders to F &L.
(2) One of the invoices (I.D. -16 page 4) indicates that
the ordered item, a submersible pump, was picked up
by John Nee, who was a plumber laborer for the
PBOPE.
(3) The invoices include orders for new supplies,
including submersible pumps (I.D. -16 pages 1,4) and
parts (I.D. -16 pages 5,8), and for the pick -up and
repair of other pumps (I.D. -16 pages 2,3,6,7).
Fabian could not recall whether she personally took
orders from Armand Zangrilli.
e. The Pittsburgh School District was a customer of F &L.
(1) The Pittsburgh School District used purchase order
numbers on its orders.
14. Dan Vaughn is employed by Trumbull Industries as a Branch
Manager for the company's Meadville, Pennsylvania branch,
having served in this capacity since July, 1985.
a. Trumbull Industries ( "Trumbull ") is in the wholesale
supply business.
b. A&D is a customer of Trumbull Industries.
c. Trumbull's business records. indicate that Armand
Zangrilli picked up numerous orders for A&D.
(1) The names of other individuals also appear as
having picked up supplies for A&D, including the
names Donna Luke and Michael Luke.
d. On several occasions, Vaughn personally had
dealings with Armand Zangrilli for A&D.
•
(1) Zangrilli personally came in to Trumbull
supplies for A &D.
business
to order
(2) Vaughn talked with Zangrilli about Trumbull's
products.
(3) Vaughn answered Zangrilli's questions pertaining to
A &D's account.
Zangrilli, 92- 036 -C2
Page 33
(4) Vaughn stated, "To me [Armand] was A&D Mechanical."
e. Vaughn does not recall ever talking to Donna Luke.
f. Trumbull's forms also had a box which was for the
customer's record - keeping purposes, and the customer
controlled the information put in it.
(1) The name "Armand" appears in this box for numerous
purchases by A&D.
(2) The name "Donna" also appears in this box on
numerous forms.
15. Mark Trew is President of Trew Company, Inc. ( "Trew Company ")
having served in this capacity for eight (8) years.
a. Trew Company, Inc. is
distributor of pumps
b. Trew Company, Inc.
accounts receivable.
a manufacturers' representative and
and related products.
maintains ledger cards to track
(1) Each time an invoice is sent to a customer, it is
posted on the ledger card for that respective
account.
(2) Accounts are in the name of the customer, and are
not assigned a number.
c. From 08/01/89 to 10/13/89, Armand Zangrilli had an
account in his own name with Trew Company, Inc.
(1) Trew Company has a ledger card under the name
Armand Zangrilli (I.D. 23, page 1).
(a) The ledger begins 08/01/89 with the first
entry being a "balance forward" of $0.00 (I.D.
23, page 1).
(b) The final entry under Armand Zangrilli's name
is dated October 13, 1989 and indicates a
balance of $93.00 and total "Sales -to -date" of
$3,773.00 (I.D. 23, page 1).
(c) The entries are on a sheet numbered "1" (I.D.
23, page 1).
d. As of October 13, 1989, Zangrilli's account at Trew
Company became the account of A &D.
(1) Trew Company has a ledger card under the name A &D
Zanarilli, 92- 036 -C2
Page 34
Mechanical, Inc. (I.D. 23, pages 2 -5).
(a) The entries under A&D's name begin on a sheet
which Trew Co. has numbered "2" (I.D. 23, page
2) .
(b) The entries under A&D's name begin on October
13, 1989 by forwarding Zangrilli's balance of
$93.00 and total "Sales -to- date" of $3,773.00
(I.D. 23, page 2).
e. When A&D got a tax - exempt certificate, Zangrilli' s ledger
card was credited by Trew Company for sales tax which had
been paid for items ordered under the name Armand
Zangrilli.
(1) The second entry on the ledger card under Armand
Zangrilli's name is an entry dated 08/23/89 for the
amount of $2,713.60 (I.D. 23, page 1).
(2) This is the only entry for that date and it is the
only entry for that amount (I.D. 23, page 1).
(3) The invoice dated 08/23/89 shows the items were
shipped on 08/22/89 (I.D. 23A, page 1).
(4) The price was $2,560 plus 6% sales tax in the
amount of $153.60, for a total of $2,713.60 (I.D.
23A, page 1).
(5) Trew Company issued a credit memo dated 09/18/89 to
A&D in the amount of $153.60, for sales tax which
had been paid on items shipped 08/22/89 (I.D. 23A,
page 2) .
(6) A&D did not order any items shipped 08/22/89
because A&D did not have an account until 10/13/89.
(Finding 15d).
(7) The following notation appears on the credit memo
issued to A&D: "This credit is issued for the 6% PA
Sales Tax charged on Trew Co. Inv. #8908 -6097
(certificate on way)" (I.D. 23A, page 2).
(8) The credit memo number is 8909 -6292 (I.D. 23A, page
2) .
(9) The credit memo appears as the eighth entry on
Armand Zangrilli's ledger card (I.D. 23, page 1).
(10) After Trew Company, Inc. received a copy of the tax
Zanarilli, 92- 036 -C2
Page 35
exempt certificate for A&D, no sales tax was
charged for A&D's purchases.
f. A&D was billed for purchases made on the account under
Armand Zangrilli's name.
(1) Invoice No. 8909 -6187 indicates that the items were
sold to A&D with the notation: "Attn: Armond
Zangrille (sic)" (I.D. 23A, page 3).
(a) The invoice date is 09/06/89 and the shipping
date is 09/05/89.
(b) A&D's name was not on the account until
10/13/89. (Finding 15d).
(c) The invoice appears as the third entry on
Armand Zangrilli's ledger card (I.D. 23, page
1) .
(d) A credit memo dated 10/13/89 was issued for
invoice No. 8909 -6187 (I.D. 23A, page 7).
(1) The credit was for $33.60 (I.D. 23A, page
7) .
(2) The credit was for the 6% sales tax which
had been charged on the invoice and bears
the notation "(certificate on file) ".
(I.D. 23A, page 7).
(3) The credit memo lists both A&D and
Zangrilli as the customer (I.D. 23A, page
7) .
(4) The credit memo is number 8910 -6525 (I.D.
23A, page 7).
(5) The credit memo appears as the final
entry on Armand Zangrilli's ledger card
(I.D. 23, page 1).
(2) Invoice No. 8909 -6239 indicates that the items were
sold to A&D (I.D. 23A, page 4).
(a) The invoice date is 09/14/89 and the shipping
date is 09/12/89 (I.D. 23A, page 4).
(b) A &D's name was not on the account until
10/13/89. (Finding 15d).
Zangrilli, 92- 036 -C2
Page 36
g-
(c) The invoice indicates that the order was
placed by "Armond" (I.D. 23A, page 4).
(d) The invoice appears as the fourth entry on
Armand Zangrilli's ledger card (I.D. 23, page
1) .
(3) Invoice No. 8910 -6463 indicates that the items were
sold to A&D (I.D. 23A, page 5).
(a) The invoice date and the shipping date are
10/06/89 (I.D. 23A, page 5).
(b) A&D's name was not on the account until
10/13/89. (Finding 43(b) (4) (b)) .
(c) The invoice indicates that the order was
placed by Armand Zangrilli (I.D. 23A, page 5).
(d) The invoice appears as the tenth entry on
Armand Zangrilli's ledger card (I.D. 23, page
1).
(e) A credit memo dated 10/13/89 was issued for
invoice 8910 -6463 (I.D. 23 -A, page 6)
(1) The credit was for 47.00, for incorrect
pricing (I.D. 23 -A, pages 5, 6).
(2) The credit memo indicates the customer as
A&D.
(3) The credit memo number is 8910 -6494.
(4) The credit memo appears as the twelfth
entry on Armand Zangrilli's ledger card.
There are 46 orders documented by the invoices under
A&D's name (I.D. 23 -A) .
(1) Armand Zangrilli is indicated as having placed 32
of these orders, which are documented on the
original and carbon copies of Trew Invoices in
evidence as:
I.D. 23A- 4/23B -1; 23A- 5/23B -4; 23A- 15/23B -10;
23A- 16/23B -11; 23A- 17/23B -12; 23A- 18/23B -13;
23A- 19/23B -14; 23A- 20/23B -15; 23A- 21/23B -16;
23A- 22/23B -17; 23A- 23/23B -18; 23A- 24/23B -19;
23A- 26/23B -21; 23A- 27/23B -22; 23A- 28/23B -23;
23A- 29,23A- 30/23B -24; 23A- 31/23B -25;
Zangrilli, 92- 036 -C2
Page 37
h.
(1)
23A- 32/23B -26;
23A- 36/23B -29;
23A- 42/23B -35;
23A- 48/23B -41;
23A- 51/23B -44;
23A- 33/23B -27;
23A- 39/23B -32;
23A- 44/23B -37;
23A- 49/23B -42;
23A- 52/23B -45;
23A- 34/23B -28;
23A- 41/23B -34;
23A- 46/23B -39;
23A- 50/23B -43;
23A- 53/23B -46.
Trew Company, Inc. keeps the amber carbon copy of its
invoice as the record that the materials were received by
the customer.
The words, "WILL CALL" which appear on the invoice
means that the order is going to be picked up,
rather than delivered.
(2) The carbon copy of the invoice is signed by the
recipient at the time the merchandise is picked up.
(3) Most of A&D's orders were picked up, rather than
delivered.
i. Of the forty -six (46) orders under A&D's name, Armand
Zangrilli is indicated as having picked up at least
seventeen (17) orders (I.D. 23 -B, pages 1, 2, 4, 5, 6, 7,
9, 10, 11, 12, 13, 14, 17, 27, 28, 35, 36) .
(1) John Nee, who was a plumber laborer for the PROPS,
is indicated as having picked up at least thirteen
(13) of these orders (Finding 31(f)), (I.D. 23 -B).
(2) Donna Luke is indicated as having picked up one
order for A&D (I.D. 23B -46).
(3) Four orders bear the names of various other
individuals.
For at least 11 of A&D's orders from Trew Company, Armand
Zangrilli is indicated as having both placed the order
and picked it up. (Findings 15(g) and (i)).
k. Trew personally dealt with Armand Zangrilli and Donna
Luke in dealing with the A &D account.
1. Some of the items ordered by A &D were commercial items
and some were residential.
16. Donald Fink is the President and co -owner of Action Supply
Products, Inc. ( "Action Supply ") having served in this
capacity for approximately ten and one -half years.
a. Action Supply is primarily a supplier of oil absorbent
products, wiping materials and maintenance supplies.
Zanarilli, 92- 036 -C2
Page 38
b. Shortly before April, 1990, Action Supply was
verbally informed that A&D was the successful
awardee of the business for wiping rags for the
PBOPE.
(1) Action Supply was informed that A&D would be
placing orders with Action Supply for the wiping
rags.
(2) Action Supply was informed that the orders would be
released by someone from the PBOPE.
(3) Action Supply was asked to ship the wiping rags
directly to the PBOPE, which it agreed to do.
c. The orders from A&D for the wiping rags were placed by
telephone.
(1) John Black, a sales representative
Supply, handled these orders.
(2) Fink did not personally deal
representatives of A&D, and does not
Zangrilli.
for Action
with any
know Armand
d. A&D placed six (6) orders with Action Supply for wiping
rags to be shipped by Action Supply directly to the PBOPE
(I.D. 17 -1, 17 -3, 17 -5, 17 -7, 17 -9, and 17 -11).
(1) Each of the six orders was for 1,000 pounds of
wiping cloths at $1.49 per pound for a total of
$1,490.00 per invoice.
(a) Invoice number 022536 (I.D. 17 -3) had a
shipped quantity of only 425 pounds, and
therefore was for $633.25.
e. Action Supply had previously done business directly with
the PBOPE primarily on wiping rags.
(1) Action Supply solicited wiping rag business from
the PBOPE through sale persons and bids.
(a) Action Supply solicited this business from
Billie Talak (Kruse) and Ernie Miller.
f. Action Supply charged A &D the same price for the wiping
rags that Action Supply charged the Pittsburgh School
District for wiping rags, which was $1.49 per pound, or
$1,490 for 1,000 pounds.
Zangrilli, 92- 036 -C2
Page 39
(1) A&D sold wiping rags to the PBOPE for $1,700 per
1,000 pounds (See Finding 25j).
Armand Zangrilli's name does not appear on the invoices
(I.D. 17 -1, 17 -3, 17 -5, 17 -7, 17 -9, and 17 -11).
h. Armand Zangrilli's name does not appear on the bills of
lading for these goods (I.D. 17 -2, 17 -4, 17 -6, 17 -8, 17-
10, 17 -12) .
g•
(1) The bill of lading is the shipping document that is
signed by the recipient of the goods upon delivery.
(2) Ernie Miller's name appears on some of the bills of
lading (I.D. 17 -4, 17 -6, 17 -8).
(3) The name "B. Baxter" appears on some of the bills
of lading (I.D. 17 -2, 17 -10, 17 -12).
i. After Action Supply was advised by A&D that A&D had been
given the wiping rag business for the PBOPE, John Black
contacted Ernie Miller to find out why A&D got the
business.
17. Joseph R. Starr is Corporate Secretary and a sales person for
Conroy Starr and Associates, Inc., having been so employed for
6% years.
a. Conroy Starr and Associates, Inc. ( "Conroy Starr ") is a
manufacturer's representative, primarily for plumbing
supplies.
b. A&D is a customer of Conroy Starr.
(1) The staff of Conroy Starr take notes of its
customers' telephone calls pertaining to parts or
prices, which notes are kept as business records
for a period of time.
c. Starr was present when Armand Zangrilli picked up
material for A &D.
(1) Starr recognizes Armand Zangrilli to see him.
d. Investigative Division Exhibit 18 is a copy of the
invoices from Conroy Starr to A &D for products purchased.
(1) The invoices pertain to purchases from July 18,
1991 through October 1, 1991.
(2) The invoice dated January 3, 1991 (I.D. -18, page 5)
Zangrilli, 92- 036 -C2
Page 40
bears instructions to call Armand Zangrilli to pick
up the materials, and lists the telephone number
for Armand Zangrilli's office at the PBOPE: 488-
5109.
(3) John Nee, a plumber laborer for the PBOPE, is
indicated as having picked up one order (I.D. -18,
page 6) .
(4) Donna Luke is indicated as having placed three
orders (I.D. -18, pages 1, 4, 6), and as having
received materials twice (I.D. -18, pages 7, 8).
f. A&D's tax exemption certificate dated March 25, 1991
indicates Donna Luke's name as President of A&D.
g•
Conroy Starr's records include a check from A&D signed by
Luke.
18. Donald Smith is the Controller for Morris Paper Company, which
is an industrial packaging distributor.
a. A&D placed four orders with Morris Paper Company between
01/03/91 and 08/30/91 (I.D. 19).
(1) One of the orders is indicated as having been
placed by Donna Luke (I.D. 19, pages 7 -9).
(2) Armand Zangrilli is indicated as having picked up
three of the four orders for A&D (I.D. 19, pages 2,
8, 11) .
(3) Donna Luke is indicated as having picked up one
order (I.D. 19, page 5).
b. Donna Luke signed a check from A&D to Morris Paper
Company.
c. Smith is not involved in the company's sales, and so has
never dealt personally with A&D.
19. Patricia A. Ryan is employed_ as the Administrative. Manager for
Construction Tool Service, Incorporated ( "Construction Tool
Service "), which is a wholesale retailer for the construction
industry for small to mid - weight equipment.
a. A&D placed eleven (11) orders with Construction Tool
Service between 04/19/90 and 08/20/91 (I.D. 20).
(1) Four of these orders indicate "Verbal: Armand,"
and /or "Contact: Armand." (I.D. 20, pages 8 -9, 16-
Zangrilli, 92- 036 -C2
Page 41
17, 18 -19, 22 -23).
(2) The name "Lukas" or "Luke" appears as the contact
on two orders (I.D. 20, pages 12 -13, 14 -15).
(3) The names of other individuals appear as the
contact on two other orders (I.D. 20, pages 6 -7,
10 -11) .
(4) Armand Zangrilli is indicated as having picked up
six of the eleven orders for A&D. (I.D. 20, pages
5, 7, 9, 17, 19, 23) .
(5) Donna Luke is indicated as having picked up three
orders (I.D. 20, pages 3, 13, 21).
(6) John Nee, who was a plumber laborer for the PBOPE,
is indicated as having picked up one order (I.D.
20, page 11).
(7) Another individual is indicated as having picked up
one order (I.D. 20, page 15).
b. Ryan is not personally involved in the company's sales.
20. Judith Pacileo is the former manager of the Meadville branch
of R.E. Michel Company, having served in that capacity for
approximately 46 years until June, 1993.
a. R.E. Michel is a wholesale distributor of heating, air
conditioning, and refrigeration parts, equipment, and
supplies.
(1) The goods sold by R.E. Michel were geared more
toward residential than commercial usage.
(2) R.E. Michel Company's Meadville store has business
hours from 8:00 a.m. to 4:30 p.m., Monday through
Friday and Saturdays from 8:00 a.m. to 12:00 p.m.
b. As Manager of the Meadville branch, Pacileo managed the
branch, worked the counter, and did ordering.
c. Pacileo became acquainted with Armand Zangrilli through
Zangrilli's patronage of the Meadville branch of R.E.
Michel Company.
d. To purchase from R.E. Michel Company, Zangrilli had to be
affiliated with a company.
(1) R.E. Michel Company will not sell to individuals.
Zangrilli, 92- 036 -C2
Page 42
(2) Zangrilli had an account in his name with the
Pittsburgh branch, but the Meadville branch only
had an inactive or old account in Zangrilli's name
and it could not be accessed by the computer.
e. Zangrilli indicated that he was affiliated with A&D.
(1) Zangrilli told Pacileo that he was the owner of
A&D.
(2) In a conversation with Pacileo, Zangrilli
referenced "A&D" as "Armand and Donna ".
(3) Zangrilli had conversations with Pacileo regarding
A&D's jobs.
(4) Pacileo also had dealings with Donna Luke, who
Pacileo understood to be Zangrilli's wife.
f. The first purchase made by Zangrilli which Pacileo
recalls was in late 1990 or early 1991, for shop towels.
(1) This was a product that R.E. Michel did not
ordinarily sell in large quantities, and Zangrilli
bought an unusually large number of boxes of them.
(2) Zangrilli stated that this purchase was for his
trucks in Pittsburgh.
g. Approximately at the end of 1992 A&D had a charge
account, for which A &D used a Conneaut Lake address.
(1) Armand Zangrilli was still making the purchases for
A&D at this time.
(2) Armand Zangrilli brought checks in A&D's name to
Pacileo to make payments for A&D.
h. Zangrilli's purchases for A&D from R.E. Michel Company
included furnaces and related sheet metal products for
furnace installation, air conditioning equipment, and
residential water heaters.
(1) Most of these units were residential as opposed to
commercial.
(2) Occasionally, the Tempstar furnaces would be
delivered to the job, but most often Armand
Zangrilli would pick them up.
(3) Sometimes Donna Luke would pick things up.
Zangrilli, 92- 036 -C2
Page 43
i. A&D provided a certificate of tax exemption to R.E.
Michel Company.
21. Michael Reilly is the former majority stockholder of Safety
Warehouse, Inc. trading as Safety First Supply, which until
1993 was a distributor of safety equipment products such as
safety glasses, hard hats, respirators, and gloves.
a. A&D placed five orders with Safety First between 08/23/89
and 10/08/91 (I.D. 21).
(1) Armand Zangrilli is indicated as having placed two
of the five Orders for A&D (I.D. 21, pages 8 -9 and
10 -12) .
(2) The other orders are indicated as having been
placed by Donna Luke (I.D. 21, pages 1 -3, 4 -5, 6-
7) .
(3) Donna Luke is indicated as having picked up two of
these orders (I.D. 21, pages 6, 8).
(4) Armand Zangrilli is indicated as having picked up
part of Order No. 103478 (I.D. 21, page 2), the
remainder of which was later cancelled by Donna
Luke (I.D. 21, page 1).
b. Reilly has not met and does not know Zangrilli or Luke.
22. Brian William Swager is President of B.M. Kramer and Company,
Inc. ( "B.M. Kramer "), which is a distributor of industrial
pipe valves and pipe fittings.
a. A&D placed four (4) orders with B.M. Kramer between
September, 1989 and July, 1991 (I.D. 22).
(1) One of the orders is indicated as having been
placed by Armand Zangrilli (I.D. 22, pages 7 -8,
12) .
(2) Two of the orders are indicated as having been
placed by Donna Luke (I.D. 22, pages 3 -4, 10, 5 -6,
11) .
(3) Donna Luke is indicated as having picked up the
four orders (I.D. 22, pages 9, 10, 11, 12).
(4) All of the orders are for commercial items.
c. Kramer personally had dealings with Armand Zangrilli on
several occasions.
Zangrilli, 92- 036 -C2
Page 44
23. David Oliver is a collection coordinator for the BP Oil
Company, having served in that capacity for eleven (11) years.
a. Armand Zangrilli has a charge account with BP Oil Company
for the purchase of gasoline and other products produced
by BP Oil Company.
(1) Some of the purchase tickets on Zangrilli's account
are signed by the name "Donna Luke," and some of
the purchase tickets are signed with Zangrilli's
name.
24. Edward W. Preskar is employed by the Pittsburgh School
District as the Director of Facilities, having fulfilled the
duties of this position since approximately 1989.
a. From 1989 to early 1992, the PBOPE owned approximately
125 buildings.
(1) Preskar estimates that there are approximately
12,000 requests for repairs or maintenance which
come through his office each year.
(a) Approximately one -third of these requests are
of an emergency nature and two- thirds are
routine requests.
(2) Repairs required by the Allegheny County Health
Department would be made quickly, because the
Health Department has the authority to close a
school for uncorrected violations.
(a) There have been occasions where Preskar
received Health Department reports on more
than one school on the same day.
b. The trade personnel are within Preskar's chain of command
and Preskar indirectly supervises them.
(1) The front line supervisor for the trade personnel
is the Chief of Maintenance, who presently is John
Dyer, and formerly was Charles McShane.
(2) During the relevant period from late 1989 through
early 1992, Preskar relied upon the Chief of
Maintenance to run the South Side operation, with
Preskar personally going to the Service Center
approximately once per month, usually to confer
with the Chief of Maintenance.
c. The Trades Foreman is responsible for scheduling the work
Zangrilli, 92- 036 -C2
Page 45
of the group of tradesmen under his direction, organizing
the work orders, providing technical help and backup to
those workers, and expediting and ordering material
necessary to complete the repair orders given to those
respective foremen.
d. A Trades Foreman has the authority to select vendors and
to order and obtain products.
(1) The Plumber Foreman is given this authority because
of his expertise.
(2) From 1989 to January of 1992, Trades Foremen could
use their knowledge and discretion in placing
orders for materials under one thousand dollars.
e. On January 6, 1992, Preskar met with Armand Zangrilli,
who was accompanied by his Attorney Albert Zangrilli, Jr.
(1) The purpose of the meeting was to hear Armand
Zangrilli's response to allegations pertaining to
purchases of materials from ADAM and A&D, with
which companies it was rumored that Armand
Zangrilli had some relationship (I.D. 42).
(2) Armand Zangrilli indicated that A&D and ADAM were
being used for the purchase of materials used by
the plumber tradesmen.
(3) Preskar asked Zangrilli what his relationship was
to the person or persons who owned these companies.
(a) Armand Zangrilli's response to the question
was "She is a friend of mine." (I.D. 42).
(b) Preskar did not specifically ask Armand
Zangrilli if he was married to Donna Luke.
(4) Preskar asked Armand Zangrilli, "What is your
relationship to these companies, and what is your
interest ?"
(a) Armand Zangrilli's response was that he did
not have an interest in these companies.
(5) Armand Zangrilli had a large sheaf of work orders
with him, and stated that he could demonstrate
where all of the material ordered for these work
orders had been placed in the schools.
(6) Preskar made notes of the meeting immediately
Zangrilli,, 92- 036 -C2
Page 46
following the meeting, and subsequently issued a
formal memo dated 1/16/92 of what had taken place
at the meeting (I.D. 42).
f. Preskar has not seen any documentation that Zangrilli
requested or ordered particular supplies to be purchased
from A&D or ADAM.
25. Ernest B. Miller is employed as a "Storekeeper I" by the
PBOPE, having served in that capacity since 1969.
a. Miller reports to Kruse within the chain of command under
McConachie, Director of Purchasing.
b. Miller's duties are to ship, receive, and fill in orders
for materials.
(1) Miller works with all of the trades and the
custodians.
c. Miller orders and maintains the warehouse stock for the
trade groups.
(1) Stock items are ordered through a different process
than non -stock items.
(a) Stock items are ordered on a "Purchase Order"
form, which is different from a Maintenance
Materials Requisition Form.
(b) Miller personally prepares the purchase orders
for stock items.
(c) A purchase order number is assigned by an
individual other than Miller.
(d) Miller receives his copies by mail.
(2) "Wipe rags" are stock items.
(a) Industrial wipes, as opposed to "wipe
are not stock items.
rags"
(3) Pumps are not maintained in warehouse stock for the
plumbers or steamfitters.
(4) Prior to January, 1994, Miller was assisted in the
storeroom by Mr. Willard Baxter.
(a) Baxter's duties included unloading trucks,
filling orders, and putting away materials.
Zancrilli, 92- 036 -C2
Page 47
(5) Miller did not personally check to see that
materials from A&D and ADAM were delivered.
(a) Initially Miller testified that Baxter
unloaded materials and that Miller was not
allowed to pick up anything due to heart
surgery.
(b) Miller subsequently testified that everything
purchased from A&D or ADAM was delivered and
received by the PBOPE.
(c) Miller subsequently acknowledged that he did
not personally check all of the materials
received at the Service Center.
d. When a tradesman needs an item which is not maintained in
warehouse stock, the purchase is documented by a
Maintenance Materials Requisition Form also known as the
"DBA 121 ".
(1) Each purchase is assigned a purchase order number
with a release number.
(a) Miller states that his responsibilities
included issuing these numbers.
(b) Miller issued many of these numbers for all
trade groups.
(c) Kruse told Miller to stop giving out "RR"
numbers.
(d) Miller states that trades people were not
permitted to assign release numbers or fill
out suppliers.
(1) Miller testified that a tradesman who
requested an item did not request a
particular supplier.
(2) Miller states that frequently a purchase would be
completed before a purchase order number was
assigned to it.
(3) A tradesmen could purchase an item directly and
bring the packing slip to Miller for preparation of
the Maintenance Materials Requisition Form after
the materials had already been obtained.
Zangrilli, 92- 036 -C2
Page 48
(a) For these purchases, Miller states that he got
the information for the Maintenance Materials
Requisition Forms from the tradesmen.
(b) Miller states that this procedure was followed
frequently and by all trade groups between
1989 and 1992.
(c) This procedure was not limited to emergencies.
e. All of the 123 Maintenance Materials Requisition Forms
enumerated on Investigative Division Exhibit 28 -A are for
purchases from ADAM, between 10 -18 -90 and 12 -16 -91 (I.D.
28 -A) .
(1) Of the 123 Maintenance Materials Requisition Forms
enumerated on Investigative Division Exhibit 28 -A,
all but two are in Miller's handwriting,
specifically I.D. 28 -117 and I.D. 28 -160.
(2) Miller stated that at the time he prepared these
documents, he was not familiar with ADAM and was
not aware of whose company it was.
(3) Miller testified that McShane specifically directed
Miller to give out each of the 121 orders to A&D
enumerated on I.D. 28 -A which are in Miller's
handwriting.
(a) Of the .121 Maintenance Materials Requisition
Forms enumerated on I.D. 28 -A which bear
Miller's handwriting, 117 forms were prepared
after McShane's last day on the job, and 65 of
those were prepared after McShane's death.
(b) Upon further questioning as to whether McShane
was not already dead when some of these forms
were prepared, Miller stated that he could not
remember whether McShane gave him specific
directions on these forms.
(c) Miler testified that if McShane was dead when
these documents were prepared, Miller could
not recall another person who would have given
him directions to prepare these forms.
(d) Miller stated that he could not recall any of
these orders being brought to him by
tradespeople.
f. Armand Zangrilli brought packing slips to Miller for
Zanarilli, 92- 036 -C2
Page 49
g•
preparation of Maintenance Materials Requisition Forms.
(1) Miller initially testified that Armand Zangrilli
brought him packing slips for Miller to prepare
Maintenance Materials Requisition Forms.
(2) After being questioned about the forms enumerated
on Investigative Division Exhibit 28 -A, Miller
subsequently stated that he had no specific
recollection of whether Armand Zangrilli had
brought packing slips to Miller for materials that
had already been obtained to obtain a purchase
order number.
(3) Miller stated that Armand Zangrilli never brought
him packing slips from ADAM.
Miller acknowledged that Donna Luke would bring him
packing slips.
(1) When asked if he actually saw the materials for
these packing slips, Miller stated that Baxter
unloaded materials, and that Miller was not allowed
to pick up anything because of his heart surgery.
h. Miller stated that when a tradesman would purchase
materials directly, Miller would not receive the packing
slip for two or three days or as much as a week later.
i. All of the approximately 218 Maintenance Materials
Requisition Forms enumerated on Investigative Division
Exhibit 29 -A are for purchases from A&D, between 8/89 and
12/91 (I.D. 29 -A).
(1) Of the 218 Maintenance Materials Requisition Forms
enumerated on Investigative Division Exhibit 29 -a,
all but one, I.D. 29 -229, were prepared by Miller.
(2) Miller stated that at the time these documents were
filled out, he did not know who owned A&D.
(3) Miller testified that he guessed McShane picked the
vendor on these purchases.
(a) Of the approximately 217 Maintenance Materials
Requisition Forms enumerated on I.D. 29 -A
which bear Miller's handwriting, 77 were
prepared after McShane's last day on the job,
and 43 of those were prepared after McShane's
death.
Zanarilli, 92- 036 -C2
Page 50
j•
Miller repeatedly changed his testimony regarding
instructions from McShane to purchase from A&D /ADAM.
(1) Miller initially testified that he did not remember
whether McShane gave him a general direction to
purchase from Donna Luke or whether this was done
for each purchase.
(2) Miller then testified that he did recall being told
by McShane several hundred times to make purchases
from A&D.
(3) When questioned further as to whether this happened
for the forms dated 1991, Miller testified that he
didn't remember the dates but that McShane would
bring Donna Luke over and Miller would give her the
order.
(a) Miller stated that he could not remember
whether this was done on each and every
occasion or just some occasions.
(4) Miller then stated that McShane gave him direction
on specific purchases on a "pretty regular basis ".
(5) When asked whether McShane would have given such
directions to Miller in 1990 and 1991, when these
forms are dated, Miller responded affirmatively for
as long as McShane was there until he died.
k. Miller stated that he could not recall whether the
Maintenance Materials Requisition Forms enumerated in
Exhibits 28 -A and 29 -A were completed after the materials
had been purchased.
1. Miller stated that he learned that A&D and ADAM were
owned by Donna Luke at some point after the Maintenance
Materials Requisition Forms in Exhibits 28 -A and 29 -A
were filled out.
m. Miller did not know Donna Luke and Armand Zangrilli were
married until he was so informed By the investigators of
the SEC.
n. The Pittsburgh School District at one time purchased wipe
rags, a stock item, directly from Action Supply Company.
(1) Subsequently, the School District purchased these
wipe rags from A &D.
Zanarilli, 92- 036 -C2
Page 51
(2) Miller states that he had to stop buying from
Action Supply because it moved outside the City and
he was directed to buy from within the City.
o. When the wipe rags were purchased through A&D, Action
Supply continued to supply the rags and shipped them
directly to the School District (I.D. 17).
(1) On 04/03/90, the PBOPE placed purchase order no.
140074 with A&D for 1,000 pounds of wiping rags at
the price of $1,700 (I.D. 29- 397/398; R -9, page 9).
(a) The purchase order indicates the price was
quoted "per Donna ".
(b) One copy of the purchase order bears the name
of Kruse, Miller's superior (R -9, page 9).
(c) On 04/09/90, Action Supply shipped 1,000
pounds of wiping rags directly to the PBOPE,
and billed A&D for these rags in the amount of
$1,490.00 (I.D. 17 -7).
(1) There is no name or number indicated in
the box labelled "Purchase Order # ".
(d) A&D's invoice to the PBOPE for these wiping
rags is dated 4/10/90 and is in the amount of
$1,700.00 (I.D. 29- 396/399).
(1) A&D's profit from this sale was $210.00.
(2) On 06/15/90 Action Supply shipped 1,000 pounds of
wiping rags directly to the PBOPE, and billed A&D
for these cloths in the amount of $1,490.00 (I.D.
17 -9) .
(a) "Ernie" is indicated as having placed this
order.
(b) Purchase order no.
twelve days later,
with A&D for 1,000
$1,700.00 (I.D. 29-
The purchase order
quoted "per Donna ".
146701 of the PBOPE dated
06/27/90, placed an order
pounds of wiping rags for
557/559; R -9, page 12).
indicates the price was
One copy of the purchase order bears the name
of Kruse, Miller's superior (R -9, page 12).
Zanarilli, 92- 036 -C2
Page 52
(e) A&D's invoice to the PBOPE for these wiping
rags is dated 7/05/90 and is in the amount of
$1,700.00 (I.D. 29- 556/558).
(1) A&D's profit from this sale was $210.00.
(3) On 10/02/90, the PBOPE placed purchase order no.
154606 with A&D for 1,000 pounds of wiping rags at
the price of $1,700. (I.D. 29- 675/677; R -9, page
13) .
(a) The purchase order indicates the price was
quoted "per Donna ".
(b) One copy of the purchase order bears the name
of Kruse, Miller's superior (R -9, page 13).
(1) Miller stated that he is familiar with
Kruse's handwriting and that the
signature of Kruse's name on this form is
not Kruse's handwriting.
(a) Miller stated the name was signed by
office staff (See Finding 25p).
(b) The initials "B.T." next to Kruse's
name stand for Kruse's maiden name
"Billie Talak."
(c) On 10/04/90, Action Supply shipped 1,000
pounds of wiping cloths directly to the PBOPE,
and billed A&D for these cloths in the amount
of $1,490.00 (I.D. 17 -11).
(1) "Ernie" is indicated as having placed
this order.
(d) A&D's invoice to the PBOPE for these wiping
rags is dated 10/03/90 and is in the amount of
$1,700.00 (I.D. 29- 674/676).
(1) A&D's profit from this sale was $210.00.
(4) On 01/25/91, Action Supply shipped 1,000 pounds of
wiping rags directly to the PBOPE, and billed A&D
for these rags in the amount of $1,490.00. (I.D.
17 -1) .
(a) "Ernie" is indicated as having placed this
order.
Zanarill &, 92- 036 -C2
Page 53
(b) Purchase Order No. 165027 of the PBOPE dated
seven days later, 02/01/91, placed an order
with A&D for $1,000 pounds of wiping cloths
for $1,700. (I.D. 29 -789; R -10, page 1).
(c) The purchase order indicates the price was
quoted "per Donna ". (R -10, page 1)
(d) One copy of the purchase order bears the name
of Kruse, Miller's superior (R -10, page 1).
(1) The initials next to Kruse's name, "B.K."
stand for "Billie Kruse."
(e) A&D's invoice to the PBOPE for these wiping
rags is dated 2/05/91 and is in the amount of
$1,700.00 (I.D. 29 -788).
(1) A&D's profit from this sale was $210.00.
(5) On 04/22/91, Action Supply shipped 425 pounds of
wiping rags directly to the PBOPE and back - ordered
525 more pounds for the PBOPE, and billed A&D in
the amount of $633.25 (I.D. 17 -3, 4).
(a) The "Customer P.O. Number" is "Ernie 0418."
(b) Purchase order No. 170887 of the PBOPE dated
four days later, 04/26/91, placed an order
with A&D for 1,000 pounds of wiping cloths for
$1,700 (I.D. 29- 928/932; R -10, page 7).
(c) The purchase order indicates the price was
quoted "per Donna ".
(d) One copy of the purchase order bears the name
of Kruse, Miller's superior (R -10, page 7).
(e) A&D's invoice to the PBOPE for these wiping
rags was dated 4/29/91 (I.D. 29 -931).
(1) A &D charged the PBOPE $1,700 for these
wiping rags.
(a) A &D's profit from this sale was
$210.00.
(6) On 10/14/91, Action Supply shipped 1,000 pounds of
wiping cloths directly to the PBOPE, and billed A &D
for these cloths in the amount of $1,490.00 (I.D.
17 -5) .
Zanarilli, 92- 036 -C2
Page 54
(a) "Ernie" is indicated as having placed this
order.
(b) Purchase Order No. 184853 of the PBOPE dated
four days later, 10/18/91, placed an order
with A&D for 1,000 pounds of wiping cloths for
$1,700 (I.D. 29- 1079/1081; R -10, page 13).
(c) The purchase order indicates the price was
quoted "per Donna ". (R -10, page 13).
(d) One copy of the purchase order bears the name
of Kruse, Miller's superior (R -10, page 13).
(e) A&D's invoice to the PBOPE for these wiping
rags is dated 10/22/91 and is in the amount of
$1,700.00 (I.D. 29- 1078/1080).
(1) A&D's profit from this sale was $210.00.
(7) From 4/03/90 through 10/18/91, there were no
invoices from A&D to the PBOPE for wiping rags
other than those set forth in subparagraphs 1 -6
immediately above.
(8) Miller states that he probably ordered the rags
from A&D, but that he did not order them from
Action Supply.
(a) Miller states that he did not order the rags
from Action Supply for A&D.
(b) Miller states that A &D called Action Supply
and Action Supply sent the rags to Miller.
(c) Miller states that everything was shipped from
Action Supply with his name on it.
(d) Miller states that Action Supply put his name
down as the receiver.
(9) Miller knew John Black to be a salesman employed by
Action Supply Company.
(10) Miller states that he does not recall a
conversation among John Black, Armand Zangrilli,
and Miller regarding A &D's orders from Action
Supply Company. (See Finding 28d).
p. Miller stated that when Billie Kruse was not in the
office, office staff members would sign the purchase
Zangrilli, 92- 036 -C2
Page 55
orders with Kruse's name.
(1) Miller states that Kruse knew of and authorized
this procedure.
(2) Miller states that McConachie also signed the
original copy of purchase orders.
(a) None of the copies of the purchase orders
referenced in Finding 25 o above bear
McConachie's name.
Miller states that he was told by Kruse to use minority
and female vendors if he could.
(1) Miller stated that at the time he was told to bring
minority and female companies into the sales
process, he knew that A&D was owned by Donna Luke.
(a) Miller had previously testified twice that at
the time he was preparing the Maintenance
Materials Requisition Forms enumerated on Z.D.
29 -A, he did not know who owned A&D. (See
Findings 25i(2), 2 5 (1)) .
r. A&D's delivery time was comparable to the rest of the
vendors.
s. Miller states that in the past, he could place an order
without comparing prices.
(1) During the relevant time period from August of 1989
through January of 1992, orders over $1,000 had to
be approved by Miller's superiors.
t. Miller states that Donna Luke was frequently at the
Service Center soliciting orders.
u. Miller's testimony was contradictory and not credible.
(1) Miller testified that all items ordered from A&D
and ADAM were received by the PHOPN,_ but
acknowledged that he did not personally check all
of the materials received at the Service Center.
(See Findings 25c and 25g).
(2) Miller gave conflicting testimony regarding alleged
directions by McShane to order from A&D. (See
Finding 25j).
(3) Miller testified that McShane directed purchases to
Zangrilli, 92- 036 -C2
Page 56
A&D and ADAM which purchases occurred after McShane
was dead. (See Findings 25e and 25i).
(4) Miller gave contradictory testimony regarding
whether he knew who owned A&D at the time he
prepared Maintenance Materials Requisition Forms
for purchases from A&D. (See Findings 25i(2),
25(1), 25q) .
26. Willard Baxter is employed by the PBOPE as a "Store Clerk
III," having served in that capacity since 1973.
a. Baxter's duties are to receive, distribute, and ship
material, fill orders, and run a high lift and power
jacks.
b. Baxter plays no role in ordering materials for the School
District.
(1) Baxter never played any role in filling out or
processing Maintenance Materials Requisition Forms.
c. Baxter and Miller are the individuals at the Service
Center who are primarily responsible for receiving
materials.
(1) Baxter and Miller unload and move materials, with
Baxter doing most of the heavy work due to Miller's
health condition.
(2) Stock items are placed in stock.
(3) The non -stock materials are forwarded by Baxter and
Miller.
d. Miller handles the paperwork for materials received.
e. Baxter is familiar with A&D, but not ADAM.
(1) Baxter helped Donna Luke unload deliveries.
' (2) Deliveries from A&D came in a car.
(a) Baxter did not observe any markings on the
car.
(3) Baxter states that Zangrilli did not make
deliveries to the PBOPE.
f. Zangrilli introduced Baxter to Donna Luke.
Zangrilli, 92- 036 -C2
Page 57
(1) Baxter did not know Donna Luke was Zangrilli's
wife.
27. Mitchell J. Hovanec is employed by the PBOPE as a plumber,
having served in that capacity for nine and one half years.
a. From August of 1989 until January of 1992, Zangrilli as
plumber foreman was Hovanec's immediate supervisor.
b. From August of 1989 until January of 1992 while Zangrilli
was the tradesforeman, Hovanec did not personally make
any purchase from A&D or ADAM.
c. Hovanec first became familiar with these companies when
Rase showed Hovanec a document with A&D or ADAM on it.
(1) Hovanec testified that when he first became
familiar with these companies he thought the owner
was Donna Luke.
(2) At this time, Hovanec thought Donna Luke was
Zangrilli's girlfriend.
(3) Hovanec did not know Zangrilli and Luke were
married.
d. Hovanec purchased a gas valve and burner assembly for his
own personal use from Benjamin Trew Company through A&D.
(I.D. 23C).
(1) Hovanec used A&D's account at Trew Company at the
suggestion of Armand Zangrilli.
(a) Hovanec says that Zangrilli told Hovanec that
Hovanec could talk to Donna and order it.
e. Hovanec purchased an air conditioning unit through A&D.
(1) Hovanec told Investigator Bender that he dealt with
Zangrilli on this unit.
(2) Hovanec told Investigator Bender that he .went
through Zangrilli because Zangrilli could get a
better price than Hovanec could have gotten
himself.
(3) Zangrilli told Hovanec what kind of unit to get to
meet his needs.
(4) Hovanec tendered payment for the unit to Zangrilli.
Zangrilli, 92- 036 -C2
Page 58
(a) The payment was a check payable to A&D.
(b) Hovanec states he gave the check to Zangrilli
to give to Donna Luke.
28. John Black is employed as a salesman for Action Supply
Products, Inc. ( "Action Supply "), having served in that
capacity for ten years.
a. From approximately 1986 through the beginning of 1990,
Action Supply sold wiping rags directly to the PBOPE.
(1) Wiping rags are a bid item.
(2) Black was Action Supply's salesman who handled
these sales to the PBOPE.
b. In early 1990, while making a routine sales call, Black
was informed that the PBOPE had a new policy preferring
companies within the City of Pittsburgh.
(1) Ernie Miller told Black that A&D was going to
supply these rags to the School District.
(2) Miller told Black that Armand Zangrilli owned A&D.
(a) Miller initially told this to Black in a
telephone conversation in which Miller told
Black that "A&D" stood. for Armand and Donna.
(b) Miller also told this to Black in Zangrilli's
presence.
c. Black attempted to contact A&D for the purpose of
supplying A&D with the rags that A&D would sell to the
School District.
(1) On numerous occasions, Black attempted to telephone
A&D at its Pittsburgh telephone number and reached
an answering machine.
(2) On one occasion, a man answered at A&D's telephone
number.
(3) Approximately one month after learning that A&D
would be supplying wiping rags to the PBOPE, Black
got a verbal release from someone at A&D to ship
the first shipment of rags to the PBOPE.
(a) A verbal release is the verbal authorization
for a purchase using the name of the person
Zangrilli, 92- 036 -C2
Page 59
g•
placing the order, rather than a purchase
order number.
(b) Black recalls that the person who gave the
verbal release for the first shipment was a
woman.
(c) Action Supply shipped the first order directly
to the PBOPE's Service Center.
(d) Action Supply ships within five (5) days of
getting a release.
d. Black went to the Service Center to talk to Miller about
the delay and the difficulty he had experienced in
reaching someone at A&D.
(1) While Black met with Miller, Miller introduced
Black to Zangrilli.
(a) Zangrilli authorized Black to ship A&D's
future orders for wiping rags on Ernie
Miller's verbal release.
(1) Black was to call Miller periodically to
determine whether A&D was the successful
bidder on the wipe rag business as rags
were needed.
e. The invoices from Action Supply to A&D for the PBOPE's
wipe rags indicate the rags were shipped directly to the
PBOPE on the verbal release of Ernie Miller. (I.D. 17).
f. Action Supply charged A&D the same price for the rags
that Action Supply had charged the PBOPE when it had
dealt with the School District directly, which was $1,490
per 1,000 pounds. (See Findings 16d, 16f).
(1) A&D charged the PBOPE $1,700 per 1000 pounds for
these wiping rags that Action Supply delivered to
the PBOPE, making a profit of $210.00 for every
1,000 pounds. (See Finding 25j). •
Black's testimony is credible.
(1) Action Supply made the same profit whether it sold
wiping rags directly to the PBOPE or through A&D.
29. Suzanne Sadowski is employed as a secretary for Conroy -Starr
and Associates.
Zangrilli, 92- 036 -C2
Page 60
a. Sadowski took orders from A&D.
(1) The orders were placed by telephone.
(2) All of the orders placed with Sadowski
by a an identifying himself as Armand
b. Sadowski's notes for certain order(s) for
Zangrilli's telephone number at the
instructions as to when to contact him (I.D
c .
were placed
Zangrilli.
A&D include
PBOPE and
. 18 -A).
Sadowski was present when Zangrilli picked up orders for
A&D.
(1) Zangrilli paid by check or cash when he picked the
materials up for A&D.
(2) Donna Luke also picked up orders for A&D, and
tendered checks as payments.
d. A&D provided Conroy -Starr with a sales tax exemption
certificate signed with the name Donna Luke as president.
30. Investigative Division Exhibit No. 47, is a listing of the
plumbers (other than Zangrilli) who worked at the PBOPE during
the period from 1989 to 1992, namely Bigley, Brumfield,
Gillenberger, Hovenac, Jackson, Johns, Mansmann, McGee,
McMahon, Seljak, Stonehouse, and Conley.
a. During the relevant period, Conley only worked
sporadically, for a few months at a time, between the
following dates: 08/89 - 10/19/89; 10/30/89 - 04/26/90
(I.D. 47) .
b. The other ten (10) plumbers had no business dealings with
A&D or ADAM.
(1) These individuals did not personally make any
purchases from either A&D or ADAM.
(2) These individuals, to the best of their
recollection, never picked up any materials
supplies or goods from either A&D or ADAM.
(3) One of the plumbers, Seljak, did sign one invoice
from Trew Company, Inc., as the recipient of
materials sold to A &D (I.D. 23B -20).
(a) Seljak was a temporary plumber from
approximately 1987 through 1990 and became a
permanent plumber in 1991.
Zangrilli, 92- 036 -C2
Page 61
(b) Seljak does not recall picking these materials
up.
(c) Seljak does not recall Trew Company.
(d) Seljak did on various occasions, pick up
orders at supply companies at the direction of
Armand Zangrilli.
d. During the time Zangrilli was the plumber foreman, the
procedure was to use materials in stock before going to
purchase an item directly from a vendor.
(1) The plumber would use materials maintained in his
van, and then replace those materials.
(2) The plumber would get other in -stock materials by
going to Rase for the necessary paperwork.
(3) Materials that weren't in stock were obtained from
a vendor using the purchase order number.
(4) Seljak testified that the paperwork would not
necessarily name a vendor.
(a) The plumber foreman (Zangrilli) gave the
plumber the authority to go to a particular
store.
e. Dudley Brumfield has been employed as a plumber for the
PBOPE since approximately June of 1979.
(1) When asked if he had business dealings with A&D or
ADAM, Brumfield testified that the foreman usually
took care of "business dealings."
31. John Nee was employed by the PBOPE as a plumber laborer for
twenty -four years, until 1992.
a. As the plumber foreman, Zangrilli was Nee's immediate
supervisor.
b. Nee did not have the power to purchase materials for the
plumbers or to order materials from any vendor.
c. In the course of his employment as part of his job
duties, Nee frequently picked up materials from vendors.
(1) Nee had no knowledge as to how the orders were
placed for the materials he picked up.
Zangrilli 92- 036 -C2
Page 62
(2) Usually it was Armand Zangrilli who directed Nee to
pick up materials.
(3) Some of the items which Zangrilli directed Nee to
pick up for A&D were under emergency service.
d. At Zangrilli's direction, Nee picked up supplies for A&D
from F &L Pump Service Inc.
(1) F &L's Invoice No. 10405 (I.D. 16 -4) indicates that
John Nee picked up two (2) pumps for A&D.
(2) Zangrilli is indicated as having placed this order
for A&D (Finding 41(e)).
(3) Nee was directed by Zangrilli to pick up these
materials for A&D in the course of Nee's employment
as part of Nee's job duties.
e. At Zangrilli's direction, Nee picked up materials for A&D
from Construction Tool Service. (I.D. 20, page 11).
(1) Nee was directed by Zangrilli to pick up these
materials for A&D in the course of Nee's employment
as part of Nee's job duties.
f. At Zangrilli's direction, Nee frequently picked up
materials for A &D from Trew Company, Inc.
(1) At Zangrilli's direction, Nee picked up at least 13
orders for A&D from Trew Company, Inc. (I.D. 23B,
pages 16, 23, 25, 26, 30, 31, 32, 33, 34, 37, 39,
40, 43) .
(a) Nee was directed by Zangrilli to pick up these
materials for A&D in the course of Nee's
employment as part of Nee's job duties.
(b) For at least 9 of these orders, Zangrilli is
indicated as having placed the order for A&D.
(I.D. 23B, pages 16, 23, 25, 26, 32, 34, 37,
39, 43) . (Finding 15(g)). •
g•
All of the materials which Zangrilli directed Nee to pick
up for A &D were taken by Nee to the Service Center.
(1) Nee left these materials in the plumbers' section
with the packing slips attached.
(2) Nee also picked up materials for some of the other
PBOPE shop foremen.
Zangrilli, 92- 036 -C2
Page 63
32. Robert P. Caruso is the Deputy Executive Director for the
State Ethics Commission (SEC), having served in that capacity
since August, 1990.
a. Caruso has been employed by the SEC since August, 1982.
(1) From 1985 to August 1990, Caruso served as Director
of Investigations of the SEC.
(2) From 1982 to 1985 Caruso was a special investigator
for the SEC.
b. Prior to being employed by the SEC, Caruso was employed
by Clearfield County for approximately two years as
county detective and for approximately six (6) years as
a parole agent.
c. Caruso has a Bachelor of Science degree
degree in criminology.
d. Caruso has additional training in
techniques and practices, including the
Course on tracing funds and calculating
worth.
(1)
(2)
and a Master's
investigative
Link Analysis
individual net
e. Caruso had general oversight responsibility for the
investigation of Armand Zangrilli, as well as specific
duties.
f. In the course of the investigation of Armand Zangrilli,
Caruso reviewed documents from the PBOPE consisting of
payment records and cancelled checks which were paid to
A&D and ADAM.
The payments to A &D were dated from 08/21/89
through March 9, 1992 (I.D. -2A, 2B, 2C, 2D, 2E,
48) .
(a) The total amount paid to A&D was $160,472.08.
(I.D. 48)
(b) On. a yearly basis, these payments by the PBOPE
to A&D totalled: $16,428.32 in 1989;
$79,600.16 in 1990; $63,818.20 in 1991; and
$625.40 in 1992.
The payments to ADAM were dated from October 24,
1990 through March 9, 1992 (I.D. -3A, 3B, 3C, 3D,
48) .
(a) The total amount paid to ADAM was $70,473.90.
Zauarilli, 92- 036 -C2
Page 64
g•
(b) On a yearly basis, these payments by the PBOPE
to ADAM totalled: $12,312.20 in 1990;
$57,608.70 in 1991; and $553.00 in 1992.
(3) The combined total of payments to A&D and ADAM by
the PBOPE from 08/21/89 through March 9, 1992 was
$230,945.98.
A&D Mechanical maintains a checking account at Marine
Bank, Erie, PA.
(1) Luke is the sole signatory for this account.
(2) Caruso reviewed this account (I.D. 46) for the
period of August, 1989 through October, 1992.
(I.D. 49).
(3) The total major deposits made into the account were
$338,667.70. (I.D. 49).
(a) At least $223,784.30 of these deposits were
PBOPE funds.
(1) The one hundred twenty (120) checks from
the PBOPE constituting I.D. 2A -2E were
deposited directly into this account in
the total amount of $160,472.08.
(2) Forty -six (46) checks from ADAM's account
(I.D. 44) were deposited into this
account in the total amount of $68,154.00
(I.D. 49), of which at least $63,312 came
from the PBOPE. (Finding 32(h) (3) (a) (1)) .
(b) Two hundred twelve (212) checks from private
individuals, as opposed to business entities,
were deposited into this account in the total
amount of $68,114.69. (I.D. 49).
(c) Thirty -three (33) checks from Donna Luke's
personal account (I.D. 45) were deposited in
this account, in the total amount of
$23,605.00 (I.D. 49).
(d) Two (2) of Armand Zangrilli's payroll checks
from the PBOPE were deposited in this account,
in the total amount of $1,159.93. (I.D. 49).
(4) Payments totalling $127,774.89 were issued to the
following thirteen (13) vendors: Trew Company; R.E.
Michel Co; Trumbull; Action Supply Products; Meyers
Zanarilli, 92- 036 -C2
Page 65
Plumbing and Heating; Construction Tool Services;
Conroy- Starr; F &L Pump Service; B.M. Kramer
Company; Noftz Sheet Metal; Safety First; Morris
Paper, and Wilson Building Supply.
(a) Payments totalling approximately $7,700 were
made to eleven (11) other vendors.
h. Caruso's review of Account No. 4155 -2960 in the name of
Donna G. Luke d /b /a ADAM Specialty Supplies, Inc. (I.D.
44) covered the period of November, 1990 through October,
1992.
(1) The signature authority was Donna Luke.
(2) Total deposits were $75,315.68.
(a) $70,473.90 of these deposits were the checks
from the PBOPE in evidence as Exhibit I.D. 3A,
3B, 3C, and 3D.
(3) Disbursements totalled $74,487.89. (I.D. 50).
(a) Forty -six (46) checks were issued to A&D in
the total amount of $68,154.00. (I.D. 50).
(1) At least $63,312.22 of these funds
emanated from the PBOPE.
(a) Only $4,841.78 of the total deposits
to this account were from sources
other than the PBOPE ($68,154.00
less $4,841.78= $63,312.22).
(b) There were no identifiable disbursements to
vendors.
i. Caruso's review of Marine Bank Account No. 4136 -6114 in
the name of Donna G. Luke (I.D. 45) covered the period of
January 1, 1989 through October 15, 1992. (I.D. 51).
(1) The signature authority is Donna Luke.
(2) Total major deposits were $230,655.21.
(a) One hundred twenty -four (124) checks from A&D
payable to Donna Luke in the total amount of
$93,590.16 were deposited in this account.
(I.D. 51).
(b) Four (4) checks from ADAM payable to Donna
Zangrilli, 92- 036 -C2
Page 66
j
Luke in the total amount of $1,703.10 were
deposited in this account. (I.D. 51).
(c) Sixty - six (66) checks payable to cash and
endorsed by Donna Luke in the total amount of
$24,855.99 were deposited in this account.
(I.D. 51) .
(d) Eighty -two (82) of Armand Zangrilli's payroll
checks from the PBOPE in the total amount of
$48,029.74 were deposited and commingled with
the other funds in this account. (I.D. 51).
(e) Three tax refund checks payable jointly to
Armand Zangrilli and Donna Luke in the total
amount of $15,849.00 were deposited in this
account. (I.D. 51).
(f) Fifteen (15) checks from private individuals
payable to Armand Zangrilli in the total
amount of $4,790.25 were deposited in this
account. (I.D. 51).
(g) Fourteen (14) checks from the Pittsburgh
Teacher's Credit Union payable to Armand
Zangrilli in the total amount of $7,130.00
were deposited in this account. (I.D. 51).
(3) Funds from Luke's account were used to pay
obligations and expenses of Armand Zangrilli.
(a) Deposits of Zangrilli's funds into this
account exceeded the traceable funds disbursed
on behalf of Zangrilli from this account.
Caruso reviewed the A&D and ADAM checking accounts
through October, 1992.
(1) The last checks to A&D and ADAM from the PBOPE were
issued March 9, 1992 (I.D. 48).
(a) Without the PBOPE,funds, there was virtually
no activity in ADAM's account.
(b) Without the PBOPE funds, the amounts for the
A&D account dropped off significantly.
k. Zangrilli did not endorse checks from the PBOPE to A&D or
to ADAM.
33. Robert Haffner is employed by the PBOPE as the painter
Zangrilli, 92- 036 -C2
Page 67
foreman, having served in that
1993.
a. Prior to September 7, 1993, Haffner
PBOPE as the painter subforeman for
years.
b. The foreman and subforeman had the
materials for the painters.
(1) Haffner did most of the ordering.
(2) The painters did not order anything
(1) Haffner did not prepare these forms.
capacity since September 7,
was employed by the
approximately seven
authority to order
e. Six Maintenance Materials Requisition Forms
industrial wipes and dust masks from A&D and ADAM
painters trade group from 1990 -1991 (I.D. 28 -195,
29 -334, 29 -450, 29 -468, and 29 -541).
on their own.
(a) All of the painters' requests for materials
went through Haffner.
c. For items not in stock, Haffner prepared Maintenance
Materials Requisition Forms, took them to the Purchasing
Department and gave them to Herb Hatfield or Neely Earl,
who would contact the vendor.
(1) Haffner would always sign the Maintenance Materials
Requisition Forms which he prepared.
d. From 1989 through 1992, Haffner was not familiar with A&D
or ADAM.
(1) Haffner did not direct any other person to make
purchases from A&D or ADAM.
ordered
for the
28 -426,
(2) Industrial wipes were available in the tool room or
the storeroom at all times.
(a) Ernie Miller was in charge of stock items.
(b) Industrial wipes are not a stock item (Finding
25(b)(2)), but any painter could obtain wipes
from the warehouse stock without any paper
work or Haffner's involvement.
f. Haffner does not recall Zangrilli ever ordering any items
for the paint shop or the painters.
Zangrilli, 92- 036 -C2
Page 68
34. Joseph Mitchell is employed as the electrical foreman for the
PHOPE, having served in that capacity for approximately five
years.
a. Miller states that Miller gives Mitchell and the
electricians whatever they need from stock.
b. For items not in stock, Rase prepares the paperwork for
the electricians.
(1) Mitchell states that for the past couple of years,
foremen have been required to sign the Maintenance
Materials Requisition Form on the line designated,
"Required Approval."
(a) Mitchell states that prior to that time, the
foremen did not have to sign these Forms.
c. Mitchell has heard of ADAM and A&D but did not personally
make any purchases from either of them.
d. The following Maintenance Materials Requisition Forms
ordered materials from ADAM and A&D designating the
electricians group: Numbers 327144 (I.D. 28 -10), 327645
(I.D. 28 -67) , 329073 (I.D. 28 -108) , 330057 (I.D. 28 -231) ,
330709 (I.D. 28 -281), 320848 (I.D. 29 -22), 322789 (I.D.
29 -157), 323576 (I.D. 29 -185), 324186 (I.D. 29 -256),
324737 (I.D. 29 -339), 324884 (I.D. 29 -411), 328209 (I.D.
29 -419), 328349 (I.D. 29 -447), 328922 (I.D. 29 -512),
325241 (I.D. 29 -550), 325340 (I.D. 29 -564), 325771 (I.D.
29 -600), 325804 (I.D. 29 -615), 326213 (I.D. 29 -638),
329912 (I.D. 29 -808), and 331175 (I.D. 29 -936).
(1) Mitchell did not make these particular purchases.
(2) Ernie Miller's name appears on all of these Forms
except for I.D. 29 -447, which does not bear any
signature.
e. The electricians group obtained industrial wipes from
Ernie Miller.
(1) The electricians group never purchased industrial
wipes directly from a vendor.
(2) The industrial wipes were in the warehouse.
(3) Mitchell stated that industrial wipes were used by
the different trade groups without regard to which
group had ordered them.
Zangrilli, 92- 036 -C2
Page 69
f. To Mitchell's knowledge Zangrilli did not order items for
the electricians trade group.
Mitchell met Donna Luke and saw her at the Service
Center.
g.
(1) Mitchell did not advise Luke if he needed
industrial wipes.
35. William H. Taylor is employed as the carpenter foreman for the
PBOPE, having served in that capacity for approximately ten
(10) years.
a. Taylor's assistant, John Banaszewski, prepares the
paperwork to acquire materials needed by the carpenters.
b. Items which are not in stock are obtained by completing
a Maintenance Materials Requisition Form and giving it to
one of the buyers.
(1) All of the carpenters would have to come to Taylor
or Banaszewski under this procedure.
(2) The foreman could recommend a vendor to the buyer,
but could not dictate to the buyer.
c. Taylor states that a recent change in the procedure
requires that the Maintenance Materials Requisition Form
be signed by the foreman or assistant foreman.
d. Taylor has never personally made any purchases from ADAM
or A&D.
(1) To Taylor's knowledge, the carpenters trade group
has never purchased from ADAM or A &D.
e. The following Maintenance Materials Requisition Forms
ordered materials from ADAM and A&D, designating the
carpenters' group: Numbers 327647 (I.D. 28 -63), 329920
(I.D. 28 -207), 332761 (I.D. 28 -449), 324740 (I.D. 29-
331), 324767 (I.D. 29- 370), 325176 (I.D. 29 -537), 329325
(I.D. 29 -706), 330711 (I.D. 29 -895), and 331491 (I.D. 29-
950) .
(1) Taylor was not aware of and did not initiate these
Requisition Forms.
(2) These forms bear Miller's name.
(3) Some of these forms ordered quantities of
industrial wipes which the carpenters group would
Zangrilli, 92- 036 -C2
Page 70
g•
not use.
(4) Taylor testified that everyone used the industrial
wipes and that they were not specifically for the
carpenters group to use.
f. To Taylor's knowledge, Zangrilli did not order items for
the carpenters.
Taylor states that he did not receive reports as to how
much his department was budgeted or the status of its
purchases against the budget.
36. John Banaszewski is employed by the PBOPE as the subforeman
for the carpenters group, having served in that capacity for
approximately ten (10) years.
a. Banaszewski does the ordering for the carpenters group.
(1) All of the carpenters' requests for materials go
through Banaszewski, who prepares the paperwork.
(2) This same procedure applied from 1989 -1992.
(3) To Banaszeweki's knowledge, Zangrilli did not do
ordering for the carpenters group.
b. To obtain materials which are not in stock, Banaszewski
prepares the Maintenance Materials Requisition Form and
turns it over to Neely Earl in the Purchasing Department
(1)
In preparing the Maintenance Materials Requisition
Form, Banaszewski would indicate the item needed
and, if he knew of the vendor which carried it, the
name of the vendor.
(2) Earl was not required to use the vendor recommended
by Banaszewski.
(3) Earl does all of the purchasing for the carpenters
group.
c. The Maintenance Materials Requisition Forms identified in
Finding 35e were not prepared by Banaszewski.
(1) At the time these Forms were filled out,
Banaszewski was not familiar with ADAM or A &D.
(2) Banaszewski did not authorize the purchase of any
of the materials exhibited on these orders from A &D
and ADAM.
Zanarilli, 92- 036 -C2
Page 71
(3) To Banaszewski's knowledge, none of the people
under him requested purchases of these items from
A&D or ADAM.
(4) Banaszewski is not aware of how these particular
Forms were processed or these purchases made for
his trade group.
(5) Banaszewski states that the signatures on these
forms look like Miller's handwriting.
(6) Some of these purchases were for industrial wipes.
(a) Banaszewski has never asked Miller to order
industrial wipes.
(7) The carpenters group has obtained wipes from the
stockroom from Miller.
(a) Miller always had industrial wipes in stock.
(b) From August, 1989 through January, 1992 a
carpenter could get those wipes from Miller
without a requisition.
37. Richard Dillon is employed as the steamfitter foreman for the
PBOPE, having served in that capacity for thirteen (13) years.
a. When the steamfitters group needs materials from
warehouse stock, the paperwork is prepared by Rase.
(1) When Miller gave stock items to the steamfitters
upon request, the order would subsequently come to
Dillon for Dillon's approval.
b. The pumps used by the steamfitters are not kept in stock.
c. For materials which are not in warehouse stock, Dillon
prepares the order form and gives it to Rase or Miller.
(1) The steamfitters underneath Dillon report to Dillon
when they need materials.
(2) All requests for materials go through Dillon.
d. Dillon is not familiar with A&D or ADAM and never
personally made any purchases from them.
(1) Dillon never directed or authorized any purchases
to be made from A &D or ADAM.
Zanarilli, 92- 036 -C2
Page 72
(2) Dillon has no knowledge or information as to
purchases made from A&D or ADAM.
e. During the relevant period from August, 1989, through
January, 1992, the following supplies were ordered from
A&D and ADAM, designated to be for the steamfitters
group, without Dillon's authorization:
(1) Nine (9) Armstrong pumps which cost the PBOPE
$2,239.10 (I.D. 29 -161, 181, 584, 780, 947, 1093;
28 -171) .
(a) Dillon is not familiar with the Model S25
Armstrong pump and has never ordered it.
(b) Eight of these nine pumps were Model S25
Armstrong pumps.
(2) Three (3) Gorman Rupp pumps which cost the PBOPE
$1,602.82 (I.D. 29 -590, 642).
(a) The steamfitters group never uses any Gorman -
Rupp pumps.
(3) Four (4) sump pumps which cost the PBOPE $864.00
(I.D. 29 -672).
(4) Two (2) heavy duty submersible pumps which cost the
PBOPE $417.06 (I.D. 29 -457).
(5) Various types of gloves which cost the PBOPE
$2,007.50 (I.D. 29 -414, 826; 28 -314).
(6) Two (2) cases of drain waste cleaner and one (1)
case of silicone gasket maker, which cost the PBOPE
$335.00 (I.D. 28 -32).
(7) Eighty -one (81) quantities of vis -queen which cost
the PBOPE $3,928.50 (I.D. 29 -305, 349, 423, 505,
554, 576, 1090; 28 -18, 131).
(a) Dillon ordered vis - queen, but not in the
quantities reflected on these orders.
(8) Eighty -four (84) boxes /cases of black liner rubbish
bags which cost the PHOPE $3,444.00 (I.D. 29 -477,
528, 629, 722; 28 -276, 353, 454).
(a) Dillon did not order these bags in the
quantities reflected on these orders.
Zanarilli, 92- 036 -C2
Page 73
(9) Twelve (12) boxes of heavy duty liners which cost
the PBOPE $492.00 (I.D. 28 -58).
(10) Twenty -one (21) cases of industrial wipes which
cost the PBOPE $1,410.00 (I.D. 29 -318, 345, 804,
939; 28 -71, 413).
f. Black plastic bags, vis- queen, and masks were used for
asbestos removal.
(1) There was not much asbestos removed during the
relevant time period of August of 1989 through
January, 1992.
(2) Most of the asbestos removal occurred from 1983-
1985.
(3) Miller had these items on hand approximately half
the time and when he did not, would usually get
them the same day.
g. Each foreman was responsible for ordering materials for
his own trade shop.
h. The carpenters group has a departmental budget.
(1) Materials ordered for the carpenters group are
charged against the budget of the carpenters group.
(2) Dillon does not check the budget for his department
unless he is told that it is low.
(3) Dillon is not aware of the charges that are made
against his department's budget.
(4) Charges could have been made against the carpenters
group for items used by other trades.
38. Daniel Bender is employed by the SEC as a Special Investigator
II.
a. As a Special Investigator. for the State Ethics
Commission, Bender was assigned to the investigation of
Armand Zangrilli.
b. Bender reviewed documents and records, including: Armand
Zangrilli's payroll checks from the PBOPE; the checks
from the PBOPE to A &D and ADAM; leave records for Armand
Zangrilli as the plumber foreman of the PBOPE; documents
relating to purchasing procedures of the PBOPE; all known
invoices and requisitions for business transacted between
Zanarilli, 92- 036 -C2
Page 74
the Pittsburgh School District and A&D and ADAM; and
records of vendors who supplied A&D and /or ADAM.
c. For Investigative Division Exhibits 30 through 35 Bender
correlated vendor invoices for materials and supplies
acquired by A&D with a subsequent sale to the PBOPE by
either A&D or ADAM, to determine the resulting "profit"
to A&D and ADAM.
(1) Purchases from vendors were correlated to sales by
A&D and ADAM to the PBOPE through the approximate
dates and the product descriptions on the invoices
and PBOPE requisitions.
(2) In a given transaction, the materials ordered from
a vendor may not have been the very materials sold
to the PBOPE.
(3) "Profit" to A&D and ADAM was calculated as the
difference between the price paid to the vendor by
A&D /ADAM and the price charged to the PBOPE for
materials and supplies sold to the PBOPE by A&D and
ADAM.
(4) Investigative Division Exhibit 36 is a summary of
these exhibits and Bender's calculation of total
"profit" to A&D and ADAM.
d. Investigative Division Exhibits 30 and 31 only include
transactions where Bender determined there was a
corresponding vendor invoice for the supplies sold by A&D
and ADAM to the School District.
e. Investigative Division Exhibit 30 enumerates one hundred
fourteen (114) instances where Armand Zangrilli's name
appeared on the vendor invoices as having either placed
the orders or picked up the materials for A &D.
(1) I.D. 30 does not include orders picked up by
Zangrilli which were indicated as having been
placed by another person.
(2) Bender calculated the "profit" to A&D /ADAM (the
difference between the price paid to the vendor by
A&D and the price charged to the PBOPE) for the
materials and supplies sold to the PBOPE by A &D and
ADAM for the sales enumerated on I.D. -30 to be
$16,895.05.
(3) Zangrilli testified that a vendor invoice for "824
Raypak Boilers" (I.D. 23A, page 1) was not
Zanarilli, 92- 036 -C2
Page 75
accurately matched to I.D. 29 -42, which is a
Maintenance Materials Requisition Form for a "Ray
Pak W2824 Modulating Water Heater." (See Finding
41w(2)) .
f. Investigative Division Exhibit 31 enumerates seventy -five
(75) instances where either Luke's name or no name
appeared on the vendor invoice.
g-
(1) This exhibit does not overlap I.D. -30.
(a) This exhibit does not include any instances
where Zangrilli's name appeared on the vendor
invoice.
(2) I.D. 31 proffers that the "profit" to A&D /ADAM
(the difference between the price paid to the
vendor by A&D and the price charged to the
PBOPE) for the sales enumerated on I.D. -31 was
$7,483.51.
Investigative Division Exhibits 32, 33, 34, and 35
identified sales by A&D /ADAM to the PBOPE of various
types of supplies for which Bender could not find a
corresponding vendor invoice.
(1) Bender calculated the "profit" from these sales as
the full amount paid by the PBOPE.
(2) Bender acknowledged that:
(a) it would be possible for an invoice to be
missing or for A&D to have had a supply in
inventory, such that a supplier invoice would
not be found;
(b) items could be purchased for cash without a
supplier invoice; and
(c) it would be possible for there to be a vendor
patronized by A&D /ADAM whose records were not
subpoenaed by the Investigative Division.
h. Investigative Division Exhibit 32 identified sales of
Model 525 Armstrong pumps to the PBOPE by A &D and ADAM.
(1) Between 09/01/89 and 11/19/91 A &D and ADAM invoiced
the PBOPE for seventy -two (72) model S25 Armstrong
Pumps.
(2) For forty (40) of these pumps, Bender identified a
Zangrilli, 92- 036 -C2
Page 76
corresponding vendor invoice from Trew Company.
(a) There were thirty -two (32) pumps for which
Bender could not find corresponding vendor
invoices.
(3) Rase prepared five of the Maintenance Materials
Requisition Forms which ordered these pumps,
specifically: I.D. 29- 48/49, 52/53, 56/57, 60/61,
and 64/65.
(a) Bender found a corresponding vendor invoice
(I.D. 23A -3) from Trew Company for four of
these pumps (I.D. 32 -1).
(1) These four pumps cost A&D $140.00 each.
(2) The profit to A&D for these pumps was
$86.00 per pump, for a total of $344.00.
(b) Bender could not find a corresponding vendor
invoice for the fifth pump.
(1) Luke testified that her sources for
Armstrong Pumps were Trew Company and
cash sales (See Finding 42u).
(2) The pumps which Luke purchased as cash
sales cost A&D much less than pumps
purchased from Trew Company. (See Finding
42u(4)) .
(3) The profit to A&D from the sale of the
fifth pump was at least $86.00.
(c) Total profit to A&D for these five pumps was
$430.00.
i. A&D Mechanicals, Inc. and ADAM Specialty have made
various sales of drain and sewer cleaner to the PBOPE.
(1) Sales have been by either in quart or % gallon
containers.
(2) Bender identified twenty -three (23) vendor invoices
for sewer and drain cleaner.
(a) Armand Zangrilli is indicated as having made
twelve (12) of these purchases for A &D /ADAM.
(b) Luke is indicated as having made nine (9) of
Zanarilli, 92- 036 -C2
Page 77
j
these purchases for A&D /ADAM.
Investigative Division Exhibit Number 37 lists fifteen
(15) incidents where the PBOPE had multiple purchases of
items on the same dates from A&D or ADAM.
(1) For some of these fifteen (15) instances, the
multiple requisitions were for different trade
groups, building locations, and /or repair orders.
(2) In at least four (4) instances, these conditions
did not exist.
(a) There were two contracts dated 02/04/91 in the
amount of $1,200 each, divided among four (4)
requisitions at $600 each (I.D. 29 -762, 29-
765, 29 -769, 29 -772).
(b) There was one contract dated 03/12/91 in the
amount of $1,290, divided among (2)
requisitions at $645 each (I.D. 28 -236, I.D.
28 -240).
(c) There was one contract dated 06/28/91 in the
amount of $1,440.00 divided among two
requisitions at $720 each (I.D. 28 -340, I.D.
28 -344) .
(d) There was one contract dated 07/11/91 in the
amount of $1,410.00 divided among three
requisitions (I.D. 28 -361, 28 -365, 28 -369).
(1) Two requisitions were for $564.00 each
and one was for a lesser quantity at
$282.00, for a combined total of
$1,410.00.
k. From 1989 -1991, A&D and ADAM acquired an increasing
percentage of PBOPE's plumbing supply purchases.
(1) A &D's sales to the PBOPE commenced approximately
8/21/89 (I.D. 48).
(a) In 1989, with only four months of sales, A&D
placed eighth out of twelve plumbing supply
vendors, getting 4% of the total of that
business.
(b) ADAM's sales to the PBOPE commenced
approximately 10 /24/90 (I.D. 48).
Zangrilli, 92- 036 -C2
Page 78
(2) In 1990, A&D and ADAM had combined sales
constituting 24.8% of the total of that business.
(a) A&D was in second place out of thirteen
plumbing supply vendors with 21.5% of the
total of that business.
(b) ADAM's sales to the PBOPE commenced
approximately 10/24/90 (I.D. 48).
(1) With only two months of sales, ADAM
placed ninth out of thirteen plumbing
supply vendors, with 3.3% of the total of
that business.
(3) In 1991, A&D and ADAM placed second and third
respectively out of fourteen plumbing supply
vendors, with combined sales equalling 35.3% of
the total of that business.
(a) The combined sales of A&D and ADAM greatly
exceeded the plumbing supply sales of any
other vendor.
1. For Investigative Division Exhibit 43, Bender
corresponded, by dates, vendor invoices which indicated
that Armand Zangrilli placed the order to PBOPE with
requisitions for those supplies.
(1) Many of the vendor invoices also indicated that
Armand Zangrilli received the supplies from the
vendor.
(2) Bender acknowledged that for a given match, the
materials ordered from a vendor may not have been
the very same materials sold to PBOPE.
(3) In one instance, it was not clear whether the
documents referenced the same supply (I.D. 43 -2,
line 7 pertaining to I.D. 23A -33 and I.D. 29 -686).
m. Investigative Division Exhibit 53 is a compilation_ of ,
A&D's payments for Armand Zangrilli's charge account with
BP Oil.
(1) The total amount of payments by A&D to BP Oil for
the charge account in Armand Zangrilli's name was
$11,767.33.
(2) The total amount of payments by A &D to BP Oil on
Zangrilli's account for charges where the charge
Zangrilli, 92- 036 -C2
Page 79
slip bore Zangrilli's name as the purchaser was
$777.81.
n. On October 8, 1993, in the course of an attempt by Bender
to serve a subpoena in relation to the hearing of this
case regarding Armand Zangrilli, Armand Zangrilli stated
to Bender, "You tried to ruin my business by contacting
my suppliers and people I do business for."
(1) The only suppliers and vendors which Bender had
contacted were suppliers and vendors of A&D /ADAM.
39. McShane died in service on March 29, 1991 (I.D. 60).
a. The last day that McShane was actually on the job was
October 19, 1990.
b. McShane was on sick leave from October 22, 1990 to March
29, 1991.
40. Veleter Mazyck is employed by the PBOPE as Assistant
Solicitor.
a. For the "relevant period" of August of 1989 through
January of 1992, Mazyck is not aware of a Board policy to
inform employees and officials of duties under the Ethics
Law.
b. During the relevant period, Statements of Financial
Interests were not disseminated to the trades foremen by
the PBOPE.
41. Armand Zangrilli served as a Plumber Foreman for the
Pittsburgh Board of Public Education (PBOPE) from March 30,
1987 until September 15, 1992.
a. He was employed as a Plumber Tradesman from June 10,
1974, until his appointment as foreman
b. Zangrilli's immediate supervisor as foreman from 1987
through June (sic), 1991 was Charles McShane. Thereafter
it was John Dyer. [McShane died in March, 1991 (See
Finding 39)].
c. Armand Zangrilli has not filed Statements of Financial
Interests with the PHOPE since his appointment as plumber
foreman.
d. Armand Zangrilli and Donna Grace Luke were married on
October 30, 1989, in Vernon Township, Meadville, Crawford
County, PA by Hubert Vogan, Justice of the Peace.
Zangrilli, 92- 036 -C2
Page 80
(1) Marriage license application no. 62411 was filed
with the Crawford County Clerk of Courts on October
11, 1989.
(2) License no. 62411 was issued on October 17, 1989.
e. Zangrilli and Luke maintain a residence at R.D. #1,
Oakmont Drive, Conneaut Lake, PA with a mailing address
of P.O. Box 490, Conneaut Lake, PA.
(1) The home was purchased on May 13, 1988, from Gordon
and Helen Barett.
(2) Donna G. Luke was the sole purchaser.
(3) Zangrilli moved to Conneaut Lake in 1988.
(4) Zangrilli also has a mailing address at P.O. Box
5060 Conneaut Lake, Pa.
f. Commencing in the early 1960's, Zangrilli conducted
business in his own name, specifically "Armand A.
Zangrilli Plumbing, Heating and Air Conditioning."
(1) This business was in operation during the years
1989 through 1992.
(2) This business was previously "Armand Plumbing" when
Zangrilli worked with his father who was also named
"Armand Zangrilli."
(a) Zangrilli's father died twenty -five (25) years
ago.
(3) This business is not a corporation or a fictitious
name.
(4) Zangrilli states that the business in his name
operated out of wherever he lived.
(a) Zangrilli states that when he lived in the top
portion_ of the double duplex owned by his
mother, he operated out of that unit's
address.
(1) 2899 Knowison Avenue is the address of
Theresa Zangrilli, Armand Zangrilli's
mother.
(2) 537 Dorchester Avenue, Pittsburgh, PA
15226 is located in the same building as
Zangrilli, 92- 036 -C2
Page 81
g.
2899 Knowlson Avenue.
(3) The building is a corner property located
at the intersection of Knowlson and
Dorchester.
(a) 537 Dorchester Avenue is the address
used by Armand Zangrilli from March,
1987, through December, 1988.
(b) Zangrilli states that for the years 1989
through 1992, he was operating this business
from the Conneaut Lake residence which was on
Oakmont Drive.
Zangrilli testified regarding a van and tools which he
uses in his business.
(1) Zangrilli testified that during 1989 -1991, "Armand
A. Zangrilli Plumbing, Heating and Air
Conditioning" had a 1978 van used for the business
which was titled solely in Zangrilli's name.
(a) Zangrilli testified that he used a car to "go
back and forth," but "wherever the job was is
where the truck would end up."
(b) Zangrilli stated, "I don't have any office.
My truck is my office."
(2) Zangrilli testified that in the course of his
career he amassed the tools of his profession which
he needed to do his work.
(a) Zangrilli testified that he has pipe wrenches,
some power equipment including a saw, an angle
driller, and a snake container.
(b) Zangrilli testified that he has some sewer
cleaning equipment.
(3) When questioned as to the value of his tools
Zangrilli stated, "I'll say the truck with my air
conditioning equipment is three or four thousand
bucks."
(a) Zangrilli testified that $3,000- $4,000 would
be the consistent value for the tools that he
maintained in 1989, 1990, 1991 and 1992.
h. Zangrilli made prior declarations under penalty of
Zangrilli, 92- 036 -C2
Page 82
perjury in a bankruptcy proceeding which are contradicted
by his testimony.
(1) On May 24, 1990, Armand A. Zangrilli petitioned the
United States Bankruptcy Court for the Western
District of Pennsylvania for relief under Chapter 7
of the Bankruptcy Code (I . D . 61) .
(2) The documents filed in the bankruptcy proceeding
included a Statement of Financial Affairs for
Debtor not Engaged in Business, with attached
schedules.
(a) The Statement of Financial Affairs was signed
by Zangrilli under his declaration under
penalty of perjury that he read the answers in
the Statement and that they are true and
correct to the best of his knowledge,
information and belief.
(b) There is no mention within Zangrilli's
Statement of Financial Affairs of "Armand A.
Zangrilli Plumbing, Heating and Air
Conditioning."
(c) Zangrilli specifically denied having a
business.
(1) Question 2(c) of the form, pertaining to
"occupation and income," and Zangrilli's
answer are as follows:
Have you been in a partner-
ship with anyone, or engaged
in any business during the 6
years immediately preceding
the filing of the original
petition herein? (If so, give
particulars, including names,
dates and places.)
No.
(d) Zangrilli signed a declaration under penalty
of perjury that he had read Schedules A &B of
this document and that they were true and
correct to the best of his knowledge,
information and belief.
(1) Zangrilli testified that he did not read
these schedules.
Zangrilli, 92- 036 -C2
Page 83
(2) On the schedule designated "Current
Income and Current Expenditures for
Individual Debtor," Zangrilli indicated
"N /A" where he was to disclose his self -
employment.
(3) On Zangrilli's "Summary of Debts and
Property" there was no figure listed for
"Machinery, equipment, and supplies used
in business."
(a) When questioned as to this
particular contradiction with his
testimony, Zangrilli stated that
although he had testified that he
had tools, he did not own the tools.
(1) Zangrilli stated that his
mother, who is not a plumber,
owns the tools.
(2) Zangrilli stated that when his
father died (25 years earlier) ,
his father left the tools to
his mother.
i. Zangrilli became the plumber foreman for the PBOPE on
March 30, 1987.
Zangrilli states that he requested but never received a
written outline of the duties of the plumber foreman
(1) Zangrilli authored a typewritten letter /memo dated
June 15, 1989 (Respondent's Exhibit 15) to McShane,
Colautti and Preskar officially asking for a job
description.
(a) Zangrilli states that he did not receive any
verbal or written response to this letter.
(b) Zangrilli states that he did not receive a job
description.
(2) Zangrilli acknowledges that a job description was
written for his position but states that it was
written by McShane without Zangrilli's
participation.
(a) The job description (I.D. -1) is dated fifteen
(15) days after Zangrilli's official request.
Zangrilli, 92- 036 -C2
Page 84
(b) Zangrilli states that he never saw his job
description because he takes the month of July
off.
(3) Respondent's Exhibit 17 is a memorandum from Joy
Bieltz who is the secretary for McShane and Dyer,
regarding: "MEMO 6/30/89. JOB DESCRIPTION FOR
PLUMBER FOREMAN MR. ARMAND ZANGRILLI."
(a) McShane directed Bieltz to contact the
Personnel Office for a job description for the
Plumber Foreman
(1) Bieltz was informed that there were no
job descriptions on file for any of the
building trades.
(b) McShane wrote Zangrilli's job description for
Zangrilli's position as Plumber Foreman with
Zangrilli's aid and participation.
(c) McShane directed Bieltz to type the job
description, to sign his name to it since he
planned to be absent and to give the original
to Zangrilli.
(1) It was common for McShane to direct
Bieltz to sign his memos or letters in
his absence.
(2) Bieltz knew that the job description had
been requested by Zangrilli, but she was
not aware of the reason it was needed.
(d) This memorandum does not specifically address
whether Bieltz gave the job description to
Zangrilli.
k. Zangrilli states that the work which was directed to the
PBOPK's plumbing department was initiated through a
school principal, custodian, or a District coordinator.
(1) Zangrilli states that the request for work would go
from the District coordinator to Preskar to Dyer to
Zangrilli.
1. Zangrilli assigned the work to the plumbers.
(1) Zangrilli also assigned work to John Nee, a plumber
laborer.
Zanvrilli, 92- 036 -C2
Page 85
(2) At Armand Zangrilli's direction, Nee frequently
picked up materials from vendors in a School
District vehicle on School District time.
(a) Zangrilli stated that Nee picked up materials
for the PHOPE.
(b) Nee picked up materials for A&D (See Finding
31) .
m. The PHOPE maintains a list of vendors from which
purchases of materials for use by the maintenance
department, including the plumber tradesmen are made.
(1) A&D Mechanicals Inc. and ADAM Specialty Supply
appear on this list.
(2) In August, 1989, A&D Mechanical was placed on the
list by the late Charles McShane, former Chief of
Maintenance.
n. Materials used by tradesmen of the PHOPE in the
performance of their duties have been classified as
warehouse stock and non- warehouse stock.
(1) Warehouse stock are items that are normally part of
the school district's inventory of supplies
maintained in the storeroom.
(2) Non - warehouse stock or direct purchase materials
are items that are needed for the completion of
either emergency repair requests or scheduled
maintenance.
(3) The procedures utilized by the PHOPE for the
purchase of warehouse stock are as follows:
(a) The storeroom clerk (Ernie Miller) is
responsible for re- stocking warehouse stock
items.
(b) Contacts are made with companies which have -
previously supplied price quotes, and stock
items are replenished.
o. For the Board's plumbing shop, non- warehouse stock items
are to be purchased by materials expediters in the
Division of Purchasing.
(1) The purchase of these items are made through open
purchase orders known as buy -outs.
Zanarilli, 92- 036 -C2
Page 86
p. Zangrilli was instructed by his superiors to purchase
only from suppliers located within the City of Pittsburgh
limits.
Zangrilli stated that the procedure for ordering supplies
for the PBOPE during the relevant period from August of
1989 through January of 1992 differed "according to the
way the foreman wanted to run his shop."
r. Zangrilli stated that in his shop, the journeymen ordered
all materials.
(1) Zangrilli stated that the plumbers would take the
Maintenance Repair Request to the work site, look
at the work, determine what was needed, and order
the materials needed.
(2) Zangrilli stated that until 1992, he never filled
out Maintenance Material Requisition Forms or saw
what the journeymen ordered.
(3) Zangrilli stated that he chose to run his shop by
never filling out the Maintenance Materials
Requisition Forms or seeing what his plumbers
ordered, because he did not have enough time.
(a) Zangrilli stated that he did not have a
subforeman working under him.
(b) Zangrilli stated that since he was running his
shop, he chose to have Rase or Purchasing take
care of preparing the Maintenance Materials
Requisition Forms.
(4) Zangrilli stated that when the plumbers needed
materials they would go to Rase, Earl, or Miller.
(5) Zangrilli stated that if the plumbers needed a buy-
out, they would get an order number from Miller.
(a) Zangrilli stated that Miller would designate
the vendor.
(6) Zangrilli stated that after the job was done, the
plumbers would return the journeyman sheet to him.
s. Zangrilli stated that he wrote a typewritten letter in
August, 1987 (R -16) to the PBOPE plumbers who worked
under him, in which he stated, "Please order all
materials and tools in advance so that your time is
wisely used."
Zangrilli, 92- 036 -C2
Page 87
t.
u.
v .
w.
Zangrilli stated that the only thing he filled out was
the back of the foreman's sheet of the Maintenance Repair
Request pertaining to "Labor."
(1) Zangrilli stated that the "Materials" portion of
the maintenance repair request was not completed
but the Maintenance Materials Requisition Form was
attached.
Zangrilli states that he never assigned a release number
or wrote in the release log.
Zangrilli states that he never signed a requisition form,
whether it was a Maintenance Materials Requisition Form
or any other kind.
Zangrilli's name does not appear anywhere on any exhibit
in the Investigative Division Exhibit 29 series, whether
written by him or by third parties, with the exception of
following exhibits: I.D. 29 -42, 43, 48/49, 52/53, 56/57,
60/61, 64/65, 229, 310, 571, 901, 905, 1006 and 1107.
(1) I.D. 29 -42, 48/49, 52/53, 56/57, 60/61, 64/65, 229,
310, 571, 901, and 905 are Maintenance Materials
Requisition Forms which bear the word "Zang" at the
bottom right hand side of the forms, on the line
designated "Requested by ".
(a) Zangrilli stated that this word is in Rase's
handwriting.
(b) Rase prepared at least seven (7) of these
eleven (11) Maintenance Materials Requisition
Forms (See findings 6 j, 6 k, 6 1).
(c) Rase used the word "Zang" on the Maintenance
;Materials Requisition Forms to refer to Armand
Zangrilli (See Finding 6 i).
(d) All of these forms except for I.D. 29 -229 bear
the name "Don" on the "Required Approval"
line.
(e)
(1) This was how Rase marked the forms he
prepared (See Finding 6 n(1).
Some of these forms also bear the names of
Miller or McShane, and the initials of Neely
Earl.
(f) I.D. 29 -229 does not bear any signature on the
Zangrilli, 92- 036 -C2
Page 88
"Required Approval" line but does bear
Miller's name elsewhere on the form.
(g) Zangrilli states that he wrote a letter asking
that this practice of others writing his name
be stopped.
(h) Zangrilli states that whenever he wrote his
name on any paper pertaining to any School
Board matters, he wrote it, "Armand
Zangrilli".
(i) Zangrilli states that he did not suggest or
recommend the acquisition of these particular
parts.
(2) I.D. 29 -43 is a typewritten proposal dated August
17, 1989 from A&D for one Raypak W2 -824 modulating
water heater.
(a) The proposal indicates that it was submitted
to the following:
Name
Street
City
State
Telephone
(b) 488 -5109
number at
Board of Education
13th & Muriel
Pittsburgh
Pa
Number 488 -5109 A. Zangrilli
is Armand Zangrilli's telephone
PBOPE.
(c) Zangrilli states that he did not solicit,
receive or have anything to do with this
proposal.
(d) Zangrilli states that a Raypak W2 -824
Modulating water heater is different from an
824T Raypak boiler.
(3) I.D. 29 -902 is a typewritten proposal from A&D to
the PBOPE.
(a) The proposal indicates that it was submitted
to the PBOPE at telephone numbers 488 -5109 and
488 -5100.
(4) I.D. 29 -1006 is a Maintenance Materials Requisition
Form dated July 19, 1991 which bears the
typewritten name, "Armand Zangrilli" at the bottom
right -hand corner of the for on the line
Zangrilli, 92- 036 -C2
-Page 89
designated "Requested by ".
(a) Zangrilli states that he did not type his
name, does not know how to type, and does not
have a typewriter.
(1) Zangrilli has testified that he authored
other typewritten documents in evidence
as Respondent's Exhibits 14, 15 and 16.
(See Findings 41j, 41s and 41 ee).
(b) Below the typewritten name of Armand Zangrilli
(c) Above the typewritten name of Armand Zangrilli
is the handwritten name, "Greg Mansmann".
are the handwritten initials, "A.Z. ".
(1) Mansmann is a plumber for the PBOPE.
(d) The handwritten name, "John Dyer" appears on
the "Required approval" line.
(e) There are numerous handwritten and typed
notations on this form.
(5) I.D. 29 -1107 is an invoice
to the PBOPE.
(a) The invoice bears a
"Armand Zangrilli".
dated 01/24/92 from A&D
signature of the name
(1) Zangrilli states that he cannot identify
his handwriting on this Exhibit.
(6) Zangrilli specifically reviewed and stated that on
the following exhibits, any handwritten notation of
"A&D Mechanical" was in Miller's handwriting: I.D.
29 -1 through 29 -60, 29 -64, I.D. 29 -110 through 29-
134.
x. Zangrilli's name does not appear anywhere on any exhibit
in the Investigative Division Exhibit 28 series, with the
exception of the following exhibits: 28- 160/162,•28 -365,
28 -434, and 28 -613.
(1) I.D. 28- 160/162 is a Maintenance Materials
Requisition Form which bears the word "Zang" at the
bottom right hand side of the forms, on the line
designated "Requested by ".
(a) This word is in Rase's handwriting (See
Zangrilli, 92- 036 -C2
Page 90
Finding 6i).
(2) I.D. 28 -365 and I.D. 28 -434 are Maintenance
Materials Requisition Forms which bear signatures
of the name "Armand Zangrilli" at the bottom right
hand side of the forms, on the line designated
"Requested by ".
(a) Zangrilli states that these signatures of his
name are in Miller's handwriting.
(b) Miller prepared these forms (See Finding 25e) .
(3) I.D. 28 -613 is an invoice dated 01/24/91 from ADAM
to the PBOPE.
(a) At the bottom right -hand side of the invoice
is a signature of the name "Armand Zangrilli".
(b) Zangrilli states, "This isn't my signature,
but they did a nice job on it ".
(c) Zangrilli states that there would be no reason
for him to sign this document because he
didn't get the material, didn't do the job,
and "It wouldn't even need to be signed
because Ernie already signed it ".
(1) Miller's signature is dated 03/03/92,
which is more than one month after the
date of the invoice.
(d) Zangrilli states that John Dyer also signed
this invoice.
y. Zangrilli states that he never requested anything that is
on any of the Maintenance Materials Requisition Forms.
(1) Zangrilli states that for all of the Exhibits in
the Investigative Division Exhibits 28 and 29 which
bear his name, he did not order the materials.
(a) Zangrilli states that he did not give anyone
at the PBOPE permission to sign his name, but
that they did so.
(b) When asked if he knew who signed his name,
Zangrilli stated, "Mitch signed my name many
times."
z. Zangrilli states that during the relevant period from
Zangrilli, 92- 036 -C2
Page 91
August of 1989 through January, 1992, he never chose A&D
or ADAM as vendors to supply parts, materials, supplies
or the like to the PBOPE.
(1) Zangrilli states that Miller and Rase chose A&D and
ADAM.
(2) Zangrilli states, "My name is on none of that."
aa. Zangrilli states that during the relevant period from
August of 1989 through January, 1992, he never
recommended to anyone employed by the PBOPE that they use
any particular vendor.
(1) Zangrilli states that during the relevant period
from August of 1989 through January, 1992, he never
recommended to anyone employed by the PBOPE that
they purchase materials from A&D or ADAM.
(a) When asked if he knew whether A&D and ADAM
were doing business with the School District,
Zangrilli stated, "I knew Donna was selling to
the Board of Education."
bb. Zangrilli states that he never recommended to Rase that
he purchase Armstrong pumps from A&D.
(1) Zangrilli states that he did not recommend an
Armstrong pump to any person in the purchasing
operation of the PBOPE.
(2) Zangrilli states that he was trying to standardize
the pumps at the PBOPE.
(3) Zangrilli states that McShane wanted the School
District's pumps standardized for availability of
servicing.
(4) Zangrilli states that in 1987 McShane made the
decision to go with Armstrong pumps.
(a) Zangrilli states that he,did not tell anyone,
including McShane, where to buy the pumps.
cc. Zangrilli states that he did not monitor whether items
were properly charged against his budget.
dd. Zangrilli states that prior to 01/09/92, he received no
memoranda from anyone at the School District regarding
acquisition, purchasing, or items which had to receive
quotes.
Zanarilli, 92- 036 -C2
Page 92
ee. Zangrilli states that in early 1992 the buy -out procedure
changed per a direction by Dyer, by requiring Zangrilli's
signature on the plumbing shop's Maintenance Materials
Requisition Forms to approve them.
(1) Zangrilli states that up until that day, he never
signed or approved any of these Forms.
(2) Zangrilli states that this procedural change was
communicated to him in a meeting with Dyer.
(a) Zangrilli states he never received any written
memorandum on the change.
(3) Zangrilli states that after the change in procedure
in January, 1992, he started signing the
Maintenance Materials Requisition Forms but that
other people still signed where the foreman was to
sign.
(4) Respondent's Exhibit 14 is a typed memorandum with
attachments from Armand Zangrilli to Dyer dated
02/11/92.
(a) The memorandum regards a Maintenance Materials
Requisition Form dated 02/05/92 which failed
to comply with the procedures set forth in
McConachie's memorandum of 01/09/92.
(b) Rase had signed the form which was supposed to
be approved by the trades foreman or by Dyer.
(c) Zangrilli's memorandum bears the handwritten
initials "A.Z."
(d) Zangrilli attached a copy of McConachie's
memorandum of 01/09/92 to his memorandum.
(1) McConachie's memorandum reiterated the
existing requirement that Maintenance
Materials Requisition Forms required
proper authorization by being signed by
the trades foreman or the Chief of
Maintenance.
(2) The changes in procedure were that: upon
receipt of the materials ordered, the
trades foreman or his authorized
representative would be required to sign
the packing slip; the tradesmen's
signatures would be used to authorize
Zangrilli, 92- 036 -C2
Page 93
payment through the Division of Finance;
and the signature of the storeroom staff
would no longer be acceptable for
authorizing these payments.
ff. Zangrilli stated that he never delivered an item to the
PBOPE for A&D or ADAM.
gg.
(1) Zangrilli subsequently acknowledged that he rode to
work in a truck which was carrying materials to the
PBOPE from A&D and /or ADAM and that he unloaded
some of those materials at the PBOPE dock.
During cross examination, Zangrilli stated that the
signature of his name "Armand Zangrilli" on I.D. 28 -613,
which is an invoice from A&D to the PBOPE, is not his
"because there's no A in it."
(1) Zangrilli stated that every time he signs his name
at the PBOPE he tries to sign it with his middle
initial.
hh. A&D was officially created as of September 28, 1989 (R-
20) .
(1) Approximately one month later, Zangrilli and Luke
were married (See Finding 41d).
(a) Zangrilli stated that he did not know when A&D
was started.
(2) Zangrilli stated that Luke started A&D at the
request of McShane and Dyer.
(3) Zangrilli stated that he does not know what "A&D"
stands for.
ii. A&D Mechanical transacted business with residential
customers.
(1) Services provided included plumbing, heating and
air conditioning in and maintenance.
(a) Services also included maintenance of summer
cottages located at Conneaut Lake.
(2) Residential customers included past and present
employees of the PBOPE and their relatives.
(3) One other commercial customer was the Conneaut Lake
School District through a contract with Service
Zangrilli, 92- 036 -C2
Page 94
Master.
(a) A&D performed the services in relation to this
contract.
(b) Zangrilli worked on the project for A&D.
jj. ADAM was officially created in April, 1991. (R -21).
(1) Zangrilli stated that he does not know what "ADAM"
stands for.
kk. A&D and Zangrilli have the same telephone number, street
address and mailing address.
(1) The March 1993 - February 1994 Meadville and vicinity
telephone book distributed by Alltel has listings
for A&D and Zangrilli, but not Donna Luke.
(2) Zangrilli states that there was a listing for
"Scrub -a -Dub" at the same number.
(a) According to Luke, Scrub -a -Dub is a division
of A&D. (See Finding 42(aa)).
11. Zangrilli states that he has no ownership interest in A&D
or ADAM.
(1) Zangrilli states that he owns no shares of A&D or
ADAM.
(2) Zangrilli states that he never told anyone that he
was owner of A&D or ADAM.
mm. Zangrilli denies acting on behalf of A&D.
(1) Zangrilli states that the testimony of Graham that
the representative of A&D which Graham dealt with
was Zangrilli, was inaccurate. (See Finding 3).
(2) Zangrilli acknowledged that he contacted the
Conneaut Lake School Board President David Schaef,
but states that he did not do so as the
representative of A&D.
(a) Zangrilli states that he contacted Schaef to
put his own advertisement in the newspaper.
(b) Zangrilli states that he never called Schaef
in an attempt to get business from the
Conneaut Lake School District.
Zangrilli, 92- 036 -C2
Page 95
(3) Zangrilli acknowledged that he presented a proposal
from A&D (I.D. 9, page 1) to Boyd (See Finding 5b),
but states that he presented the proposal to Boyd
on his own behalf.
(a) Zangrilli states that he bought this job from
Luke.
(b) Zangrilli was not able to state how much he
paid for this job.
(1) When asked how much he paid Luke for the
job, Zangrilli stated, "Whatever she
wanted."
(2) In response to the next question, "Do you
know what that was," Zangrilli stated, "I
don't have any idea at this moment."
(c) Zangrilli signed the acceptance of this
proposal.
(1) Despite the fact that the proposal
indicates that it is a proposal from A&D
to Boyd, Zangrilli states he accepted
this as a proposal from Boyd.
(d) The invoices for the work (I.D. 9, pages 2, 3)
are from A&D.
(1) The first invoice, dated February 18,
1992, indicates the receipt of $2,100
from Boyd and bears the notation
"Received Donna G. Luke, owner" with
Zangrilli's signature below.
(a) Zangrilli acknowledges that Luke
received this money.
(b) Zangrilli acknowledges that the
signature of his name is his
signature.
(1) Zangrilli states that he signed
this document because Boyd
wanted Zangrilli to sign
because Zangrilli was doing the
work.
(2) The second invoice, dated April 13, 1992,
bears the notation, "4/13/92 Paid in
Zangrilli, 92- 036 -C2
Page 96
full" followed by a signature of the name
"Armand Zangrilli."
(a) Zangrilli states that this notation
is not his handwriting but is the
handwriting of Tom Timlin.
nn. Zangrilli acknowledged installing furnaces and air
conditioners for A&D and ADAM, but stated that he never
worked for A&D and ADAM.
(1) Zangrilli's testimony was evasive on this issue
(See Finding 41 eee (3)) .
(2) Zangrilli's Answer to the Investigative Complaint
acknowledged that Zangrilli worked on the Conneaut
Lake School District job "for A&D."
oo. Zangrilli testified that he never ordered materials for
A&D and ADAM.
(1) On behalf of A&D, Armand Zangrilli placed orders
with R.E. Michel Company.
(a) Orders were placed telephonically by Zangrilli
on behalf of A&D to R.E. Michel's Meadville
facility.
(b) Zangrilli admitted to placing orders for A&D
with R.E. Michel and Trew Company in his
Answer to the Investigative Complaint.
(1) Zangrilli averred that these orders were
placed at A&D's request.
(2) Zangrilli states that he never placed orders for
ADAM or A&D with Susan Sadowski from Conroy -Starr
(See Finding 29).
(a) Zangrilli states that he never met or talked
to Susan Sadowski before she testified in this
case.
(b) Zangrilli acknowledged that his name and the
telephone number of his office at the PBOPE
appear on Sadowski's notes from order(s).
(1) Zangrilli stated that someone from the
PBOPE could have ordered the material and
given Zangrilli's name and telephone
number.
Zangrilli, 92- 036 -C2
Page 97
(2) These order(s) were sold to A&D. (See
Finding 29) (See I.D. 18a, I.D. 18, page
5) .
(3) Zangrilli placed orders by telephone to the Trew
Company for A&D.
(a) In his Answer to the Investigative Complaint,
Zangrilli admitted to placing orders for A&D
with Trew by telephone.
(1) Zangrilli stated that he did so at the
request of A&D.
(b) At the hearing in this matter, Zangrilli gave
contradictory /evasive testimony as to whether
he placed various orders with Trew Company
(See Finding 41 eee(4)).
(1) Zangrilli eventually denied ever ordering
a part from Trew Company using the A&D
account.
(a) Zangrilli stated, "I don't call and
order under (A&D's) account. I
bought under my name."
(b) Zangrilli's account at Trew Company,
Inc. became A&D's account on october
13, 1989. (Finding 15d).
(c) The only vendor invoice in evidence
in Armand Zangrilli's name is I.D.
23A -1, which is a Trew Co. invoice.
(1) When A&D got a tax exempt
certificate, Zangrilli received
credit for sales tax he had
paid on this invoice. (See
Finding 15e).
(,4) Zangrilli stated that he never ordered a part from
F &L Pump on the A &D account. (See Finding 13).
(a) Zangrilli stated that he had his own account
at F &L.
(5) Zangrilli stated that he dealt with Construction
Tool Services but never used the A&D account.
(6) Zangrilli stated that he did not need A &D's account
Zangrilli, 92- 036 -C2
Page 98
PP-
q4.
to buy at R.E. Michel because he had his own
account there.
(a) Zangrilli stated that he had an account with
the prior owner and with R.E. Michel who
bought the business as a private owner.
(b) Zangrilli states that Pacileo's testimony (See
Finding 20d) that R.E. Michel Company does not
sell to individuals but only to companies is
not true.
(c) Zangrilli stated that wipes were not the first
thing he bought from Pacileo, but that he
bought furnaces.
(7) Zangrilli subsequently stated that his bankruptcy
proceedings did not affect his ability to purchase
from vendors because he pays and never uses credit.
Zangrilli stated that he never arranged billing
procedures for A&D with John Black from Action Supply
(See Finding 28) .
Zangrilli picked up supplies and materials ordered by
A&D.
(1) Zangrilli reviewed signatures of his name on
various vendor invoices to A&D.
(a) I.D. 6A -45 and I.D. 6B -11 are vendor invoices
from Trumbull Industries to A&D which Armand
Zangrilli acknowledges he signed.
(1) Zangrilli testified as the purpose of his
signature on I.D. 6A -45 as follows: "The
purpose for my signature on this document
is I bought P.V. stuff for somebody's
house. That's all stuff for a home."
(2) Zangrilli picked these materials up.
(b) Zangrilli testified as to the signature of his
name on the following vendor invoices to A&D,
that he did not know whether the signature was
his: I.D. 6B -3, 6B -7.
(1) Zangrilli stated that I.D. 6B -3 was for
items that were not used at the PBOPE.
(2) Zangrilli stated that he did not know if
Zangrilli, 92- 036 -C2
Page 99
I.D. 6B -7 was for items used at the
PBOPE.
(c) Zangrilli testified that the signature of his
name on the following vendor invoices to A&D
were not his: I.D. 6B -9, 613-17, 6B -19.
(1) Of these, Zangrilli stated that I.D. 6B -9
was for items that were not used at the
PBOPE.
(2) Zangrilli stated that I.D. 6B -17 was for
items that are or could be used at the
PBOPE.
(d) Zangrilli testified that the signature of his
name on the vendor invoice to A&D which is
I.D. 6B -11 could be his.
(1) Zangrilli stated that I.D. 6B -11 was for
items that were not used at the PBOPE.
(2) Zangrilli states that he gave permission to Michael
Luke and Tom Timlin to sign his name.
(a) Zangrilli states that Timlin did work for
Donna.
(b) Zangrilli states that Timlin used Zangrilli's
name because Timlin was going through a
divorce and was receiving workmen's
compensation, and did not want to be caught.
rr. Zangrilli also directed at least one PBOPE employee, John
Nee, to pick up supplies from vendors for A&D on School
District time in a School District vehicle (See Findings
31 and 41(1)) .
ss. Zangrilli stated that he has no control over the A&D
account at Marine Bank.
tt. Zangrilli states that on McShane's vacation days, he
would come in to the plumbing shop.
uu. Zangrilli states that when McShane was on sick leave,
Zangrilli would speak with McShane by telephone every
other day.
(1) Zangrilli states that McShane came in to the
plumbing shop even after October 19, 1990.
Zangrilli 92- 036 -C2
Page 100
(2) Zangrilli states that McShane was bedridden
February and March of 1991.
vv. Zangrilli states that he saw McShane in other trade shops
at the PBOPE when McShane was on vacation or sick leave.
ww. Zangrilli reviewed I.D. 24 which consists of documents
pertaining to his charge account with BP Oil, and stated
that none of the signatures of his name were his with one
possible exception (I.D. 24 -17).
(1) Zangrilli stated that he loaned the card to Donna
Luke.
(2) Zangrilli stated that he never used it from 1989-
1991.
xx. Zangrilli stated that none of the signatures of his name
on his payroll checks were his.
yy. Zangrilli gave his payroll checks and checks made payable
to him from private individuals to Luke, and Luke handled
the finances.
(1) Zangrilli states that he made no payments out of
Luke's account.
(a) Zangrilli states that he uses cash and money
orders.
(2) Zangrilli acknowledged that Luke made payments from
her personal account on Zangrilli's account at Saks
Fifth Avenue.
(a) As to other various expenses, Zangrilli stated
that he guessed Luke paid them.
(3) Between August, 1989, and June, 1992, monthly
payments totaling $11,667.55 were made from the A&D
Mechanical account 1011 -0058 to Boron Oil Company.
(a) The checks were payments to Boron Oil Company
to be applied to account number 047- 122 - 855 -1.
(b) The account is owned by Armand Zangrilli.
(1) Charges to the account were made by
Armand Zangrilli and Donna Luke.
(4) Expenditures from account no. 4136 -6114 at Marine
Bank included expenses for vacations to Atlantic
Zangrilli, 92- 036 -C2
Page 101
City and Seven Springs.
zz. Zangrilli and Donna Luke were married on October 30,
1989.
(1) Zangrilli testified that he did not tell anyone at
the Service Center except McShane that he and Donna
Luke were married.
aaa. During an internal school district review of the business
dealings of A&D Mechanicals, Inc. and ADAM Specialty,
Armand Zangrilli made statements to officials of the
PBOPE.
bbb. During a meeting on January 2, 1992, with Billie Kruse,
school district Purchasing Support Manager, Zangrilli
denied having any interest in either A&D or ADAM.
ccc. Zangrilli and his attorney met with Edward Preskar,
Director of Facilities for the PBOPE on January 6, 1992.
(1) Zangrilli was evasive when answering Preskar's
questions about Donna Luke.
(2) Zangrilli stated that when he met with Preskar (See
Finding 24), the specific questions and answers
were as follows:
Preskar:
Zangrilli:
Preskar:
Zangrilli:
(3) Zangrilli stated:
"Do you know Donna ?"
"Yes.
"What is she to you ?"
"She's my very best friend."
"It - he (Preskar) never asked me what
relationship. He just asked me who she
is, and he never asked me if I was
married."
(4) Zangrilli stated that he never indicated to Preskar
that there is no family connection between
Zangrilli and Luke.
(5) When asked if he thought his answer was evasive at
all, Zangrilli responded as follows:
A. No. If he wanted to know if I was married all
he had to do was ask, correct?
Q.
And you would only answer a direct question or
Zangrilli, 92- 036 -C2
Page 102
a specific question?
A. That's all I have to answer with Mr. Preskar.
Q. Would you consider your answer shading the
truth to some extent?
A. I never shade the truth. If he would have
asked me, I would have been glad to tell him.
I'm not hiding nothing from Mr. Preskar.
ddd. Zangrilli stated that he was not aware of the existence
of the Ethics Law until he was notified that he was being
investigated by the State Ethics Commission.
(1) Zangrilli stated that he was never informed about
the Ethics Law by anyone at the PBOPE.
(2) Zangrilli stated that no one at the PBOPE ever gave
him a Statement of Financial Interests Form or told
him to fill one out.
eee. Zangrilli's testimony was evasive and contradictory.
(1) When asked whether it was mere coincidence that A&D
Mechanical was incorporated one month before
Zangrilli and Luke were married, Zangrilli stated,
"You have to ask Ms. Luke."
(2) When asked what "A&D" stands for, Zangrilli stated,
"Advanced dynamic maybe."
(3) Zangrilli testified that he installed furnaces and
air conditioners for A&D and ADAM, but subsequently
testified that he never worked for A&D and ADAM.
•
(a) Upon further questioning, Zangrilli stated, "I
have to know what work means."
(b) Zangrilli's Answer to the Investigative
Compliant states that Zangrilli worked for
A&D" on the Conneaut Lake School District job.
(4) Zangrilli testified that he never ordered materials
for A&D and ADAM.
(a) This testimony is contradicted by Zangrilli's
admissions in his Answer to the Investigative
Complaint where he admitted that he placed
orders for A &D with R.E. Michel Company and
Trew Company.
Zangrilli, 92- 036 -C2
Page 103
(b) Zangrilli reviewed invoices from Trew Company
to A&D which indicated that the orders were
placed by "Armand" or "Armond" (I.D. 23A -4, 5,
15, 16, 17, 18, 19, 20, 21, 22) .
(1) Zangrilli testified as to certain of
these invoices that he did not recall
placing the orders.
(a) As to one of these Zangrilli
specifically testified that it was
possible he could have placed the
order. (I.D. 23A -5).
(2) When asked if he therefore had access to
use A&D's account at Trew, Zangrilli
stated he might have picked the part up
"for Donna ".
(3) Zangrilli subsequently testified that he
did not order items from Trew using A&D's
account.
(4) Zangrilli subsequently stated he did not
recall whether he placed certain orders.
(a) When asked if it was possible that
he placed these orders, Zangrilli
stated "No, it isn't possible that I
ordered for A&D Mechanical."
(5) In his Answer to the Investigative
Complaint, Zangrilli admitted to placing
orders for A&D with Trew Company by
telephone.
(a) Zangrilli stated that he did so at
the request of A &D.
(5) Zangrilli testified that he did not use A&D's
account to order from Trew Company, Inc., F &L Pump,
Construction Tool Service, and R.E. Michel because
he had his own accounts with each of these
companies. (See Finding 41 oo (3) - (6)) .
(a) Zangrilli subsequently testified that he never
uses credit, but pays cash. (Finding 41
00(7)).
(b) When asked, "You never had any kind of account
at any of these vendors ?" Zangrilli replied,
Zangrilli, 92- 036 -C2
Page 104
"I wouldn't need it because I get my money up
front."
(6) When asked whether he picked up materials for A&D
and ADAM Zangrilli stated: "I picked up materials
for Donna. I did not pick up materials for A&D and
ADAM."
(a) When asked whether the materials he picked up
for Donna were for A&D, Zangrilli stated, "I
have no idea."
(b) Zangrilli was asked what was the purpose of
his signature on a vendor invoice from
Trumbull Industries to A&D.
(1) Zangrilli replied, "The purpose for my
signature on this document is I bought PV
stuff for somebody's house. That's all
stuff for a home."
(2) Upon further questioning as to his
purchasing materials under the A&D
account, Zangrilli testified that he just
picked up the materials.
(7) Zangrilli testified that whenever he wrote his name
on any paper pertaining to any School Board matter
he wrote it, "Armand Zangrilli." (See Finding
41w) .
(a) Zangrilli subsequently testified that every
time he signs his name at the PBOPE he tries
to sign it with his middle initial (See
Finding 41gg).
(b) Zangrilli signed Respondent's Exhibit 16
"Armand Zangrilli" without any middle initial,
and initialled Respondent's Exhibit 14 "A.Z."
(1) These are documents which Zangrilli
testified he authored. (See Findings_
41s, 41w, 4lee).
(8) Zangrilli was asked to review I.D. 29 -43 (See
Finding 41w(2), a proposal from A&D which indicates
that it was submitted to the PBOPE listing the name
"A. Zangrilli" together with the telephone number
of Zangrilli's office at the PBOPE.
(a) When asked if his name is A. Zangrilli,
Zanarilli, 92- 036 -C2
Page 105
Zangrilli stated, "My name isn't A. Zangrilli,
it's Armand Zangrilli."
(1) When asked if his first initial is A,
Zangrilli stated, "You could call it
that, yes."
(b) When asked if he had any idea how his name and
telephone number got on this proposal,
Zangrilli stated, "You have to ask the person
that did it."
(9) When asked whether I.D. -4 consists of copies of his
payroll checks from the PBOPE, Zangrilli stated,
"They could be payroll checks or they could be
travel checks. I don't know."
(10) Zangrilli positively identified his signatures on
the following exhibits: I.D. 9 (See Finding
41mm(3)); I.D. 6A -45 (See Finding 11(1)(a)).
(a) Zangrilli testified as to the precise
circumstances under which he signed each of
these signatures.
(b) When these same signatures were subsequently
presented to Zangrilli for the expressed
purpose of comparing them to other signatures,
Zangrilli testified that they "looked like"
and "could be" his signatures.
(c) Zangrilli stated, "I'm not going to commit and
tell you it is."
(11) Zangrilli testified as to many signatures of his
name that he did not know if they were his.
(a) When asked to review I.D. 6B -11, Zangrilli
stated, "This one here is mine. I know my
handwriting."
(12) Zangrilli contradicted himself an testimony
regarding whether he had a subforeman and regarding
the telephone number of his office at the PBOPE.
(a) Zangrilli testified on direct examination that
he did not have a subforeman working under
him. (See Finding 41r(3)).
(b) Zangrilli testified that the telephone number
488 -5109 which appeared in the "submitted to"
Zangrilli, 92- 036 -C2
Page 106
block on various proposals submitted by A&D to
the PBOPE (I.D. 29 -43, I.D. 29 -202), was the
telephone number in his office at the PBOPE.
(1) When subsequently asked, "So that's your
office," Zangrilli stated, "No, it's an
office that I go to. I share that office
with all the plumbers and my subforeman,
and I'm off 45 days a year."
(a) When questioned about the contra-
diction in his testimony as to
whether he had a subforeman,
Zangrilli stated that he had a fill -
in foreman.
(13) A&D's street and mailing address as indicated on
its Articles of Incorporation and Registry
Statement (R -20) are the same as Zangrilli's.
(a) Zangrilli testified that the address at which
he lives in Conneaut Lake is not the same
address used by A&D.
(b) Zangrilli subsequently testified that A&D is
partially run out of the Conneaut Lake house
and partially from Knowlson Avenue in
Pittsburgh.
(14) Zangrilli testified that he did not know if there
are any supplies and equipment at the Conneaut Lake
address for A&D.
(a) Zangrilli had previously testified that an
inventory of plumbing, heating, and air
conditioning supplies is stored in the shed
and attic above the carport at this Conneaut
Lake home, and that these supplies are not
his.
(15) Zangrilli testified that he never received any
written memoranda on changes- in the purchasing
procedures instituted in January, 1992. (See
Finding 4lee) .
(a) Zangrilli subsequently testified regarding his
own memorandum (R -14) to which he had attached
a copy of McConachie's memorandum which
instituted the changes in the purchasing
procedures. (See Finding 4lee).
Zangrilli, 92- 036 -C2
Page 107
fff. Zangrilli is not credible.
(1) Zangrilli's testimony regarding his business,
"Armand A. Zangrilli Plumbing Heating and Air
Conditioning" can not be reconciled with
contradictory declarations which he made under
penalty of perjury in his bankruptcy proceedings
(See Finding 41h).
(a) At a minimum, Zangrilli lied in the bankruptcy
proceedings or in this Commission's
proceedings.
(2) Zangrilli gave contradictory and evasive testimony
on numerous matters within the proceedings before
this Commission (See Finding 4leee).
42. Donna Grace Luke is the wife of Armand Zangrilli.
a. Luke's address is P.O. Box 5061, Conneaut Lake, Pa.
16316.
b. Prior to meeting Armand Zangrilli, Luke had no
background, education, or experience in plumbing,
heating, air conditioning, electrical or carpentry work
or in the procurement or sales of plumbing, heating, air
conditioning, electrical or carpentry supplies.
(1) Luke received a high school G.E.D. in 1977.
(2) Until approximately 1982, Luke was a full -time
mother caring for her children at home.
(3) In 1982, Luke attended a business school where she
received a certificate in computer programming.
(4) From 1982 -1988 Luke was an administrative
specialist for the Pennsylvania Air National Guard.
(a) From 1982 until 1986, Luke's service was part -
time, consisting of one weekend a month and an
additional two weeks each year.
(b) From 1986 -1988, Luke worked full -time at this
position.
(c) Luke's duties were filing, typing, and
ordering office supplies and supplements to
military regulations.
(1) This ordering was from an in -house stock
Zanarilli, 92- 036 -C2
Page 108
warehouse that the Air National Guard
maintained.
c. Luke states that at the end of 1985, she met Armand
Zangrilli.
(1) Luke states that from 1986 on, she did plumbing,
heating and air - conditioning work with Armand
Zangrilli.
(a) Luke states that she learned about
installation, repair, and the techniques of
these trades, and the related supplies and
equipment.
(b) Luke states that she also audited a plumbing
course at a community college.
d. Luke states that she formed A&D and subsequently ADAM and
began to sell supplies and materials to the PBOPE as a
result of a conversation which Luke had with Dyer and
McShane.
(1) Luke states that this conversation took place in
July or August of 1989.
(2) Luke states that she had known Dyer and McShane
since 1986.
(3) A&D's first sale to the PBOPE occurred in August of
1989, before A&D was officially incorporated.
e. Luke states that she caused A&D to be formed.
(1) Luke states that Armand Zangrilli was not present
when Luke met with Albert Zangrilli to establish
A&D.
(2) A&D Mechanicals, Inc. ( "A&D ") was incorporated in
the Commonwealth of Pennsylvania on September 28,
1989, by Albert J. Zangrilli, Jr. Esquire as a
close corporation.
(a) The address for the corporation is listed as
R.D. #1, Oakmont Drive, Conneaut Lake, PA
16316.
(3) A &D's Corporate Registry Information for
Departments of State and Revenue ( "Registry
Statement ") lists two principal officers for A&D.
Zangrilli, 92- 036 -C2
Page 109
(a) Armand A. Zangrilli is listed as "President"
on the Registry Statement.
(b) The Registry Statement provides that Donna
Luke is Secretary- Treasurer.
(c)
(1) Donna Luke was elected President of A&D
at the corporation's organizational
meeting.
The Registry Statement sets forth the
following mailing address: P.O. Box 490,
Conneaut Lake, PA 16316.
Business is indicated as having started July
28, 1989 as a sole proprietorship.
A&D's principal business activity is
designated to be "Plumbing, heating and air -
conditioning contracting; general
contracting."
(f) The registry
certification
Zangrilli, as
being, to the
correct.
statement is signed under the
of the incorporator, Albert J.
having been examined by him and
best of his knowledge, true and
(4) Luke states that she did not see the registry
statement before it was filed.
(a) Luke states that after the registry statement
was filed, she saw it and told Albert
Zangrilli that it was erroneous.
(1) Luke states that Armand Zangrilli never
held any office or position with A&D.
(2) Luke states that Armand Zangrilli never
held any stock in A&D.
(b) Luke states that she asked Albert Zangrilli to
fix the "error" which had indicated that
Armand Zangrilli was the President of A&D and
Luke was Secretary /Treasurer.
(c) Included in the corporation's Minute Book is a
copy of a letter dated October 6, 1989, from
Albert Zangrilli to Donna Luke, which states
that Albert Zangrilli talked with the
Pennsylvania Corporation Bureau about amending
Zangrilli, 92- 036 -C2
Page 110
f. Luke was elected President, Secretary and Treasurer of
A&D at A&D's organizational meeting on October 4, 1989.
(R -20) .
g.
the Registry Statement to change the name of a
corporate officer and the fiscal year.
A11 shares of A&D are in Luke's name.
h. Luke states that she also formed ADAM.
j-
(1) Luke states that Armand Zangrilli was not present
when Luke met with Albert Zangrilli to establish
ADAM.
(2) ADAM's Articles of Incorporation were filed with
the Department of State on or about April 29, 1991.
(R -21) .
(a) ADAM was incorporated in Pennsylvania under
the name, "ADAM Specialty Supply, Inc.," as a
close corporation.
(b) The address of ADAM's registered office in
Pennsylvania is R.D. #1, Oakmont Drive,
Conneaut Lake, Pa. 16316.
(1) The mailing address of P.O. Box 5061,
Conneaut Lake, Pa. is also listed.
(2) These addresses were also the addresses
of Armand Zangrilli, Donna Luke, and A&D.
(c) Albert J. Zangrilli, Jr., was the
incorporator.
(d) The Registry Statement lists Donna Luke as
President, Secretary and Treasurer.
i. All shares of ADAM are in Luke's name.
Luke was elected President, Secretary and Treasurer of
ADAM at its organizational meeting on April 30, 1991.
k. Luke states that she thought of the corporate names.
(1) Luke states that for A &D, she used the initial "A"
to be alphabetically first in the telephone book
and other listings, while the letter "D" stands for
her name, "Donna."
Zangrilli, 92- 036 -C2
Page 111
(2) Luke states that for "ADAM ", she took the "A" and
"D" from A&D's name, and added an "A" and an "M ".
(3) Luke states that the testimony of her son, Michael
Luke (See Finding 8i), that it was his idea to use
"ADAM" to stand for the names, "Armand," "Donna,"
"Anthony," and Michael is inaccurate.
(a) Luke states that it is mere coincidence that
the initials in the names "A&D" and "ADAM" are
the same initials of Armand and Donna (husband
and wife) and Anthony and Michael (Donna's
sons) who all lived together in the Conneaut
Lake residence during the relevant period,
except that Luke acknowledges the "D" stands
for her name.
(4) Luke testified that she wanted to be first in the
telephone book and other listings because she
wanted people to call her to obtain plumbing
services.
(a) A&D's listing in the Alltel telephone
directory for Meadville, Conneaut Lake, and
vicinity does not identify the company as a
plumbing business.
1. Alitel Telephone Directory for the Conneaut Lake,
Meadville area for the period March, 1993, through
February, 1994, contains listings for Armand Zangrilli
and A&D Mechanical, Inc.
(1) Armand Zangrilli is listed at Oakmont Drive,
telephone number (814) 382 -4141.
(2) A&D Mechanicals, Inc. is listed at Oakmont Drive,
telephone number (814) 382 -4141.
(3) Luke states that there are two telephone numbers
assigned to the Conneaut residence: (814) 382 -4141
and (814) 382 -4838.
(a) Luke states that these two telephone numbers
were assigned to the Conneaut residence during
the relevant period.
(b) Luke states that the first number, (814) 382-
4141 was the number for A&D, Donna and Anthony
Luke, and Scrub -a -Dub.
(c) Luke states that the second number, (814) 382-
Zangrilli, 92- 036 -C2
Page 112
4838, was Armand Zangrilli's number.
(1) Zangrilli acknowledged that his telephone
number is 382 -4141. (See Finding 41kk).
(4) When asked how people would contact her during the
relevant period to purchase items from A&D and
ADAM, Luke testified as follows:
A. I was always down at the Service Center.
Q. That was the method?
A. I was there all the time.
m. Luke sent a letter dated November 6, 1989 (R -22) to Dr.
Curtis Walker, asking to be registered as a minority,
woman -owned supplier for bidding purposes.
(1) The date of this letter is one week after Luke and
Zangrilli were married.
(2) Luke did not inform Walker that she had just
married the PBOPE's plumber foreman.
(3) Luke's letter states that she is President and
owner of A&D.
(4) Luke's letter indicates A&D's address and telephone
number as: 2899 Knowlson Avenue, Pittsburgh, Pa.
15226 (412) 341 -9927.
n. Investigative Division Exhibit 29 -43, dated 8/17/89, was
one of the first proposals A&D submitted to the PBOPE.
(1) Luke states that she prepared this proposal, with
Rase's help.
(2) Luke states that she asked Rase what telephone
number should be put in the "submitted to" block
and that she was given "488 -5109, A. Zangrilli."
(a) Luke states that Armand Zangrilli did not tell
her to put his name there.
o. Luke states that during the relevant period from August
of 1989 through January of 1992, which was the period
during which A &D and ADAM sold supplies to the PBOPE, she
made sales calls at the Service Center four or five times
a week, every week.
Zanarilli, 92- 036 -C2
Page 113
P•
q.
(1) Luke states that she called upon Rase, Miller, Dyer
and Earl, and that they also called her.
Luke acknowledges that at least $228,626.08 of the total
$338,667.70 deposited into A&D's account consisted of
PBOPE funds. (I.D. 49).
(1) The largest source of deposits into ADAM's account
(I.D. -50) was the PBOPE.
(2) The PBOPE accounted for a substantial portion of
the income received by A&D and ADAM.
(3) The PBOPE accounted for a substantial portion of
sales by A&D.
(4) Most of the other clients were individuals.
(5) During the years that A&D and ADAM were doing
business with the PBOPE, they had no other clients
that were school districts other than the Conneaut
Lake School District.
(a) From 11/08/89 through 03/13/91, the payments
by the Conneaut Lake School District to A&D
totalled $2,112.25.
Luke testified that when she dealt with the PBOPE, she
dealt primarily with Rase, Earl, and Miller.
(1) Luke states that of these three, she dealt with
Miller the most.
(2) Luke states that she would get PBOPE order numbers
in three ways.
(a) Luke states that for bids through Ernie Miller
which had to be approved by Kruse, Miller
would advise Luke if she got the bid, but Luke
had to wait for the order number to come
through the mail.
(1) Luke states that the document she
received in the mail was a purchase order
such as is exemplified by Respondent's
Exhibit 9.
(b) Luke states that for other items Miller would
hand to Luke a slip of paper with the Purchase
Order Number on it.
Zangrilli, 92- 036 -C2
Page 114
(1) Luke states that Respondent's Exhibit 23
consists of some of these slips.
(2) Luke states that there were more of these
slips given to her by Miller, but that
these are all that remain.
(c) Luke states that Neely Earl or Don Rase would
give her order numbers over the telephone.
(1) Luke states that these telephone calls
were for bigger items, and Earl and Rase
would be soliciting a written quote from
her.
(d) Luke states that she never received any
Maintenance Materials Requisition Forms.
(e) Luke states that she never received a purchase
order, either in writing or verbally, from
Armand Zangrilli.
(1) Luke states that she never asked Armand
Zangrilli to get a purchase order for
her.
r. Luke stated that she was the only person who made
deliveries for A &D and ADAM.
s. Luke subsequently acknowledged that some items which A&D
sold to the PBOPE were picked up directly from the
vendors by School District employee John Nee.
(1) Luke states that this was because Luke could not
pick them up right away.
(2) Luke states that on these occasions, she would call
Neely Earl, Don Rase or Ernie Miller to tell them
she could not get the items to the PBOPE that day,
but that "they" could pick up the items from the
vendor if it were an emergency.
(3) Luke states that she never called Nee to tell him
to go.
(4) Luke states that she never called Armand Zangrilli
to tell him to send Nee.
t. Luke testified that she never dealt with the foremen of
the trades groups on behalf of A &D, as a vendor.
Zangrilli, 92- 036 -C2
Page 115
(1) Luke was asked to explain the contradiction between
her testimony and a letter which she wrote to
Donahoe dated 1/21/92 (I.D. -64) in which she
stated that as a vendor, she contacted by telephone
calls and visits, various people including the
trades foremen to sell them products.
(a) When asked to explain this contradiction, Luke
stated that the foremen would come up to her
in the hall and ask her for industrial wipes.
(b) Luke subsequently testified that she never
dealt with the foremen as a vendor, but also
stated that her letter to Donahoe was accurate
because if the foremen told her they needed
something she would so inform Miller and ask
if he needed the item.
(2) Luke stated that she never dealt with Armand
Zangrilli as a foreman.
u. Luke states that some of the inventory of A&D or ADAM
consisted of cash purchases.
(1) Luke states that she made cash purchases from a
company called "Santaire ".
(a) On cross - examination, Luke acknowledged that
the only product which A&D /ADAM bought from
Santaire was a toilet paper product.
(2) Luke states that she made cash purchases at the
"Andover Auction" in Andover, Ohio.
(a) On cross - examination, Luke acknowledged that
the "Andover Auction" is a flea market which
operates in the summertime.
(1) Luke acknowledged that she went to this
flea market six times per year, and that
two of those times,there were no plumbing
supplies at the flea market.
(b) Luke states that the method of payment at the
auction is cash and that she did not get any
receipts.
(c) Luke states that she bought Modess boxes,
anti- freeze, sewer and drain cleaner, pumps,
visqueen, and root destroyer at this auction.
Zanarilli, 92- 036 -C2
Page 116
(1) Luke stated that she could not recall if
she bought any pumps at this flea market
in 1989, but that she bought 17 -18 pumps
there during 1990 and 1991.
(2) Luke could not recall how much root
destroyer she bought there.
(3) Luke guessed that she bought 30 -40 cases
of sewer and drain cleaner there on
behalf of A&D.
(d) Luke states that she bought products at this
auction which she in turn sold to the PHOPL at
her usual prices with no discount.
(3) Luke states that she made cash purchases from
companies or plumbers that were going out of
business.
(a) On cross- examination, Luke acknowledged that
any such sources were at. the Andover Auction
and were not additional sources.
(4) Luke states that she could buy products for less
money in a cash sale than she could from an
ordinary transaction with a vendor.
(a) Luke states that she would pay approximately
$140 for an Armstrong S -25 pump from Trew
Company, but that in a cash sale she would pay
from $88 -$94 for this pump.
(b) Luke states that in an ordinary transaction
with a vendor, she would pay $25.00 for a
Modess box, but that at the auction she paid
from $15 -$17 for a Modess box.
(c) Luke states that she would pay Trumbull
Industries $4.46 per quart for sewer and drain
cleaner, but that at the auction she could buy
sewer and drain cleaner for between $1.50-
$2.00 a quart.
(d) Luke states that she could buy root destroyer
for less money at the auction than from
Trumbull Industries, especially if she bought
in quantities.
v. Luke testified that A &D purchased: work gloves from
Safety First Warehouse; Gorman Rupp pumps from Meyers and
Zanarilli, 92- 036 -C2
Page 117
Trew Company; industrial wipes from R.E. Michel; and
visqueen from Construction Tool Services.
(1) Luke states that she does not have all of the
statements that were non -cash purchases.
(a) Luke stated that her checks would show that
she bought material from Trew Company for
which Trew Company does not have an invoice.
w. Luke states that she kept a product inventory at Conneaut
Lake Storage and in a garage in Pittsburgh which she
leased from Theresa Zangrilli (Armand Zangrilli' s mother)
at the 537 Dorchester Avenue /2899 Knowlson Avenue
property.
(1) Luke stated that she started storing at Conneaut
Lake storage around 1991.
(2) Luke states that she paid Theresa Zangrilli a
monthly rental of $75.00 for the Pittsburgh garage.
(3) Respondent's Exhibit 24 includes two (2) leases
with Theresa Zangrilli as lessor: one lease is to
A&D for a garage at 2899 Knowlson Avenue,
Pittsburgh, Pa. for a one -year term from July 1,
1989 through June 30, 1990; and the other is to
ADAM for a garage at 537% Dorchester Avenue,
Pittsburgh, Pa. for a one -year term from August 1,
1990 through July 31, 1991.
(4) Luke states that she used the garage to work out of
and to store supplies.
(5) Luke states that there was another room that she
used that had a telephone.
x. A&D and ADAM had Mercantile licenses for the City of
Pittsburgh and /or School District of Pittsburgh and paid
mercantile taxes to the City of Pittsburgh (R -24).
y. Luke states that she did A&D's service and installation
work with "helpers."
(1) Luke states that she did not have any employees.
(2) Luke states that Zangrilli and Tom Timlin did not
know anything about A &D, but helped her.
(a) Zangrilli stated that he worked for A &D in
Zangrilli, 92- 036 -C2
Page 118
performing services for the Conneaut Lake
School District.
(b) When asked to explain the distinction of how
Timlin worked on A&D's jobs but worked for
Luke and not A&D, Luke stated:
"Well, Tom was going through a divorce,
and he was on workman's comp, and I
loaned Tom some money, and Tom helped me
-- he paid me back by helping me, so it
wasn't through the company."
(3) Luke acknowledges that the jobs Zangrilli and
Timlin did were jobs that had been obtained by A&D.
(4) Luke states that A&D has never paid any
compensation to Armand Zangrilli.
aa. Luke states that she is still actively doing business
with A&D.
(1) Luke states that the Conneaut. Lake School District
and Sousa Real Estate account for 60 -65% of A&D's
business which is related to plumbing, heating and
air conditioning.
(2) Luke states that "Scrub -a -Dub" is a cleaning
service which is a division of A&D.
bb. ADAM is no longer an active corporation in terms of doing
business.
(1) ADAM ceased actively selling when the PBOPE stopped
doing business with A&D and ADAM.
cc. Luke states that she signed Armand Zangrilli's name on
his payroll checks and on Boron slips.
dd. Luke states that Zangrilli gave her a Boron card to use.
(1) Luke states that she used Zangrilli's Boron oil
charge account because she could not get credit for
A&D.
(2) Luke states that A &D used the gas and paid the
bills.
ee. Armand Zangrilli's funds were commingled with funds from
A &D /ADAM in Luke's personal checking account.
Zangrilli, 92- 036 -C2
Page 119
(1) Some of Zangrilli's expenses were paid from Luke's
account.
ff. Luke stated that there were three vehicles used by A&D.
(1) One of these vehicles, Luke stated, was a 1978
Chevy van.
g g•
(a) Luke testified that this was the only Chevy
van that A&D owned or had during the relevant
period.
(b) Luke testified that she still has this van.
(2) Luke stated that A&D also used a station wagon
titled in Luke's name, and a car, which Luke sold.
(3) Luke stated that these three vehicles were all used
by A&D at the same time.
A&D had a stock of tools and equipment.
(1) Luke testified that these were not the same tools
that Armand Zangrilli used in his plumbing
business, "Armand Zangrilli Plumbing, Heating and
Air Conditioning."
(2) luke stated that the tools and equipment included:
(a) one sewer machine that was available for
rental and had cost Luke $375;
(b) power tools, such as an electric saw, electric
drill, and electric snake;
(c) hand tools including assorted wrenches,
screwdrivers, and pliers; and
(d) a pipecutter and different sizes of threads.
(3) Luke testified that:
(a) she personally purchased all of the
A&D owned over the course of a
before A &D was formed in 1989.
(b) Armand Zangrilli told Luke what
equipment she needed to buy.
(c) When A &D was formed, the tools and equipment
became the property of A &D.
tools that
few years
tools and
Zanarilli, 92- 036 -C2
Page 120
(4)
(5)
(6)
(3)
Luke testified that the value of A&D's tools and
equipment, excluding vehicles, was approximately
$20,000.00.
Luke
(a)
(b)
stated that A&D owns office
Luke states that A&D owns
with disk drives which cost
equipment.
a typing station
$4,500.
Luke states that A&D owns two large bookcases,
three desks, one computer desk, chairs,
telephones, bulletin boards, rugs, and floor
mats which cost $3,000- $4,000.
A&D's Federal and State Income Tax return for the
year ending June 30, 1990 includes Form 4562 which
is an election to expense depreciable assets.
(a) A&D's tools and equipment are listed as having
a cost basis of $80,037.
(b) Luke indicated that her accountant prepared
the form, and she could not explain what the
$80,037 was for.
testified that the checks made payable to her by A&D
hh. Luke
were for money owed to her by A&D.
(1) Luke testified that this money was owed
money and material she put into A&D as
start -up expenses.
(2) Luke testified that she believed A&D had
capital of $3,800.
for the
capital
start -up
A&D's 1990 tax return lists loans from stockholders
of $61,951.
(a) Luke did not know how this figure was
calculated.
(b) Luke testified that there was no actual' cash
infusion of $61,951 into A &D.
(c) Luke states that she did not take any other
compensation from A&D.
ii. Donna Luke met with Daniel McConachie, Director Division
of Purchasing for the PBOPE on January 14, 1992, during
the school district's internal review of A&D Mechanical
and ADAM Specialty.
Zangrilli, 92- 036 -C2
Page 121
jj. Luke
to A
kk.
11.
mm.
testified that Armand Zangrilli did not have access
&D's account at Trew Company.
(1) Luke stated that Zangrilli had his own account at
Trew Company.
(2) Luke stated that she did not know why Zangrilli's
name appears on Trew Company invoices to A&D, in
the area designated "customer order number."
Luke stated that she wore her engagement ring and wedding
ring while at the Service Center.
(1) Luke stated that Kruse knew she was married.
(2) Luke stated that she does not know whether Miller,
Rase, or Earl knew that she was married to Armand
Zangrilli.
Luke states that she was running A&D to make money.
Luke is not credible.
(1) Luke participated in structuring Timlin's work so
as to assist him in avoiding adverse consequences
in his workmen's compensation and divorce matters
(See Finding 42y).
(2) Luke made contradictory statements regarding
whether she dealt with the trades foremen on behalf
of A &D as a vendor. (See Finding 42t).
(3) Luke testified that Zangrilli knew nothing about
A&D, yet he taught her the plumbing, heating and
air conditioning business, was her consultant as
she gathered tools and equipment for the business,
and worked on A&D's jobs.
(4) The evidence that Zangrilli's account at Trew
Company became A&D's account on October 13, 1989,
and that Zangrilli placed and picked up orders for
A&D on this account and personally dealt with Mark
Trew on behalf of A&D is clear, convincing, and
cannot reasonably be disputed (See Finding 15), yet
Luke stated that Zangrilli did not have access to
A &D's account at Trew Company and had his own
account there. (See Finding 42jj).
43. Joyce Bieltz was employed by the PBOPE as an Account Clerk.
a. Bieltz' duties included secretarial duties.
Zangrilli, 92- 036 -C2
Page 122
b. In June of 1989 Bieltz worked as a secretary to McShane,
who was Chief of Maintenance at that time.
(1) Bieltz was McShane's secretary at the time of
McShane's death on March 29, 1991.
c. The trades foremen were under McShane's supervision.
d. As part of his duties, McShane prepared job descriptions
for trades foremen, or for anyone in the trades, with the
participation of the trades foremen.
(1) The preparation of these job descriptions would be
prompted by contract negotiations or by grievances
from the foremen or the trades people.
(a) Bieltz stated that any time there was a
grievance and a copy of the job description
was requested, the PBOPE did not have one so
it was typical for the Chief of Maintenance,
along with the trades foremen, to write one.
(2) Bieltz would type job descriptions from time to
time.
(a) Bieltz does not recall whether in June of 1989
in particular, she typed job descriptions for
other trades foremen.
e. The procedure which McShane followed to prepare a job
description for a trades foreman was as follows:
(1) McShane would ask the foreman to write down his
duties and responsibilities as he saw them;
(2) The foreman would do this and would give his
writing to McShane;
(3) McShane would write the job description using his
own ideas and incorporating those of the foreman;
(4) Bieltz would type the job description according to
McShane's instructions.
f. Bieltz recalls the preparation of Armand Zangrilli's job
description in June, 1989.
g. Armand Zangrilli participated in drafting this job
description, working in conjunction with McShane.
(1) Zangrilli came into McShane's office with a paper
Zangrilli, 92- 036 -C2
Page 123
that Zangrilli had written up.
(2) McShane called Bieltz into his office.
(3) McShane told Bieltz that Zangrilli had a job
description which McShane wanted Bieltz to type,
but that McShane was first going to write something
which was to be incorporated with it.
(a) McShane told Bieltz that Armand Zangrilli
wanted to have a copy of this.
(4) Subsequently, Bieltz got McShane's writing and the
paper which Zangrilli had brought in.
(a) Bieltz is able to recognize Armand Zangrilli's
handwriting.
(b) Bieltz recognized the handwriting on the paper
which Zangrilli had brought in as Zangrilli's
handwriting.
(5) Bieltz typed up the job description for Armand
Zangrilli in accordance with McShane's instructions
to Bieltz.
(a) I.D. -1 is the job description for Armand
Zangrilli which Bieltz typed per McShane's
instructions.
(b) Bieltz personally typed the document which is
I.D. -1.
(6) At McShane's direction Bieltz signed and placed her
initials on Zangrilli's job description.
(a) Bieltz prepared the memorandum in evidence as
R -17 which explains that she signed
Zangrilli's job description for McShane in
accordance with his instructions since McShane
was planning to be absent.
(7) Bieltz does not recall which portions of
Zangrilli's job description were from which paper.
h. McShane communicated with the office when he was able.
(1) Approximately eight weeks before his death on March
29, 1991, McShane was not in a position to
communicate.
Zangrilli, 92- 036 -C2
Page 124
7
g-
(2) In December of 1990, McShane came to the office
Christmas party.
(a) McShane was not working at that time.
(b) To Bieltz' knowledge, McShane did not perform
any service at that time.
44. Allegations of violations of the Ethics Law by Armand
Zangrilli first came to the attention of the Investigative
Division in a letter received on or about February 26, 1992.
a. The investigation of Armand Zangrilli was initiated by
the Executive Director pursuant to the Executive
Director's authority to initiate a preliminary inquiry
without involvement by the Commission.
b. No member of the Commission played any role in drafting
the notice letters sent to Zangrilli (I.D. -B and I.D. -D).
c. Subpoenas were issued which is a ministerial function.
d. Neither Chief Counsel nor any member of the State Ethics
Commission accessed any investigative materials or files
while this case was being processed.
e. The Investigative Division sought any legal advice on
this case from the Executive Director, who is a lawyer.
f. Other than the hearing in this matter, no
presented to any member of the Commission.
Chief Counsel withdrew from this matter as
testifying at the hearing regarding the
issue.
k. Each Division has its own staff.
evidence was
a result of
commingling
h. The Harrisburg Offices of the Investigative Division and
the Legal Division of the State Ethics Commission are
located on the third floor of the Finance Building.
(1) Each Division is reached through the main telephone
numbers for the State Ethics Commission.
i. The Executive Director, John Contino, heads the
Investigative Division and functions independently of
Dopko.
Chief Counsel Vincent Dopko heads the Legal Division and
functions independently of Contino. (R -B).
Zanarilli, 92- 036 -C2
Page 125
III. DISCUSSION:
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 the
provisions of Act 9 to determine whether the Ethics Act was
violated.
65 P.S. §403(a).
Section 3. Restricted Activities
(a) No public official or public
employee shall engage in conduct that
constitutes a conflict of interest.
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
"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
Zanarilli, 92- 036 -C2
Page 126
65 P.S. §403(f).
general public or a subclass consisting of an
industry, occupation or other group which
includes the public official or public
employee, a member or his immediate family or
a business with which he or a member of his
immediate family is associated. 65 P.S. §402.
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.
Section 3. Restricted activities
(f) No public official or public
employee or his spouse or child or any
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,
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.
Section 4. Statement of financial interests
required to be filed
Zangrilli, 92- 036 -C2
Page 127
65 P.S. 5404(a).
(a) Each public official of the
Commonwealth shall file a statement of
financial interests for the preceding calendar
year with the commission no later than May 1
of each year that he holds such a position and
of the year after he leaves such a position.
Each public employee and public official of
the Commonwealth shall file a statement of
financial interests for the preceding calendar
year with the department, agency, body or
bureau in which he is employed or to which he
is appointed or elected no later than May 1 of
each year that he holds such a position and of
the year after he leaves such a position. Any
other public employee or public official shall
file a statement of financial interests with
the governing authority of the political
subdivision by which he is employed or within
which he is appointed or elected no later than
May 1 of each year that he holds such a
position and of the year after he leaves such
a position. Persons who are full -time or
part -time solicitors for political
subdivisions are required to file under this
section.
Section 4(a) of the Ethics Law quoted above requires that
every public official /public employee must file a Statement of
Financial Interests each year that he holds the position and the
year after he leaves the position. The Statement of. Financial
Interests requires the public official/ public employee to disclose
specific information for the preceding calendar year.
We shall first address the legal issues which Respondent has
raised.
Respondent initially sought to raise three Affirmative
Defenses in his Answer to the Investigative Complaint: first, that
the Ethics Law does not apply to Zangrilli; second, that the
Complaint fails to state a claim upon which relief can be granted;
and third, that this case would be barred by the statute of
limitations or by the effective date of the Ethics Law and its
amendments. The Respondent was advised that the rules and
regulations of the State Ethics Commission do not provide for the
raising of affirmative defenses and that the matters that he had
raised would be treated as notice to the Investigative Division of
new issues which Respondent wished to raise in the case.
Thereafter, Respondent properly raised only the first
Zangrilli, 92- 036 -C2
Page 128
argument, as to whether the Ethics Law applied to Zangrilli. This
issue is discussed below as a substantive issue. Although the
other two issues were waived by Respondent, it is noted that no
basis was at any time proffered for these arguments and none is
apparent to this Commission. We would merely add that the
Investigative Complaint in this matter was issued well within the
timeframe provided by Act 9 of 1989. (See 65 P.S. 5408(m)). There
is no statute of limitations which would bar this proceeding.
In a prehearing teleconference on October 13, 1993, the
presiding officer directed the mechanism for raising legal issues,
which required the submission of a brief.
Respondent first raised a "commingling" issue, arguing that
this proceeding improperly permits the prosecution and adjudication
of this case to be made by the same agency.
A separate hearing was held on this issue, and briefs were
submitted by Respondent and the Investigative Division. The
evidence from that hearing establishes that allegations of
violations of the Ethics Law by Zangrilli came to the attention of
the Investigative Division by a letter received on or about
February 26, 1992. The investigation of Armand Zangrilli was
initiated by the Executive Director's own motion without any
involvement by this Commission. No member of the Commission played
any role in drafting the notice letter sent to Zangrilli.
Subpoenas were issued as a ministerial function. Neither Chief
Counsel nor any member of the State Ethics Commission accessed any
investigative materials or files while the case was being
processed. The Investigative Division sought any legal advice from
its Executive Director, who is a lawyer - not from Chief Counsel.
No evidence was presented to any member of this Commission other
than the hearing in this matter.
Respondent acknowledges that under Lyness v. State Board of
Medicine, 529 Pa. 535, 605 A.2d 1204 (1992), it is sufficient for
the adjudicatorial and prosecutorial functions to be "parceled out
and divided" among individuals or entities who are distinct from
the board rendering the ultimate decision. See, Brief of
Respondent at 4 (Citing Lyness, supra). In this case, the
prosecutorial function has been executed solely by the
Investigative Division. Neither the members of this Commission nor
Chief Counsel have played any prosecutorial role.
Furthermore, the Chief Counsel withdrew from this case as a
result of testifying at the hearing on commingling. Thus, there is
no basis for Respondent to allege commingling with regard to Chief
Counsel. Indeed, Respondent could ask no more than the removal of
Chief Counsel, which has already occurred.
The remaining arguments advanced by Respondent on this issue
Zangrilli, 92- 036 -C2
Page 129
are equally baseless. The roles of the Chief Counsel and the
Executive Director as prescribed by statute and as executed are
distinct and segregated. 65 P.S. 406(i). Each of these
individuals reports directly to the Commission.
Finally, Respondent's argument based upon the physical
facilities and telephone number of the Commission offices fails to
proffer any facts which would run afoul of Lvness, supra, which
recognizes such conditions as practical and permissible realities.
Based upon all of the above, we reject Respondent's
commingling argument as without merit.
Respondent did not brief -- and therefore has waived -- a
second argument that his right to be free from self incrimination
would be infringed upon for the proffered reason that in order to
defend himself in these proceedings, he would have no alternative
but to testify. We would parenthetically note the spurious nature
of this argument. The privilege against self incrimination is
invoked by individuals who are being forced to testify. There is
no compulsion upon the Respondent to testify in these proceedings.
The Fifth Amendment does not preclude bringing proceedings against
a Respondent simply because he believes his defense will be
enhanced if he chooses to testify.
The crux of the next issue raised by Respondent is that the
First Amendment protection afforded to commercial free speech would
permit him to use his public position for illegal self dealing in
violation of the Ethics Law. The very case cited by the
Respondent, ostensibly to support his position, in actuality holds
that there is no First Amendment protection for commercial speech
related to illegal activity. Central Hudson Gas v. Public Service
Comm'n, 447 U.S. 557, 100 S.Ct. 2343, 65 L. Ed. 2d. 341 (1980); see
also, Pittsburgh Press Co. v. Human Relations Comm., 413 U.S. 376,
93 S.Ct. 2553, 37 L. Ed. 2d. 669 (1973). Respondent's argument is
rejected.
Respondent has failed to brief and has therefore waived his
fourth argument, that Act 9 of 1989 is unconstitutionally vague.
We need only note that similar arguments were raised as to Act 170
of 1978, and were rejected. Snider v. Shape, 45 Pa. Cornrow. 337,
405 A.2d 602 (1979).
Respondent's fifth argument, which regarded ex post facto
application of Commission regulations has also not been briefed and
has therefore been waived. We parenthetically note that under
either set of regulations, we would conclude -- as we do below --
that as Plumber Foreman for the Pittsburgh School District Armand
Zangrilli was a "public employee" subject to the Ethics Law.
We will now address the substantive allegations before us,
Zangrilli, 92- 036 -C2
Page 130
which are whether under Act 9 of 1989, Zangrilli violated Section
3(a) (conflict provision) , Section 3(f) (contracting provision) ,
and Section 4(a) (Financial Interest Statement filing requirement
provision) by using the authority of his position to direct school
district business to A&D Mechanicals, Inc. (A&D) and ADAM Specialty
Supply, Inc. (ADAM), businesses with which it has been alleged that
Zangrilli and a member of his immediate family are associated; by
utilizing school district equipment and materials for such private
business purposes; by using his public position to order, purchase,
or requisition various supplies and materials for the school
district from a member of his immediate family or a business with
which he is associated, which materials and supplies were paid for
by the district but allegedly were never received; by the lack of
an open and public process as to contracts between the school
district and A&D and ADAM; and by failing to file Statements of
Financial Interests for the 1989, 1990, and 1991 calendar years.
The evidence in this case has uncovered an elaborate scheme by
which Armand Zangrilli, the Plumber Foreman for the Pittsburgh
School District, contrived to sell supplies to the Pittsburgh
School District through two corporations owned on paper by his wife
whose name is "Donna Luke." Zangrilli used the authority of his
position at the School District to direct purchases to these
corporations and to direct the use of School District man hours,
facilities and equipment for these corporations.
Factually, Zangrilli was employed by the Pittsburgh Board of
Education (PBOPE) as the plumber foreman for the Pittsburgh School
District (PSD) from March 30, 1987 until September 15, 1992.
Various testimony and exhibits have been offered to establish the
authority and duties that Zangrilli had as the plumber foreman.
Zangrilli denies that he was subject to the Ethics Law.
Since the early 1960's, Zangrilli operated a business of his
own, namely "Armand A. Zangrilli Plumbing, Heating and Air
Conditioning." This business continued to operate during what has
been termed "the relevant period" of August, 1989 to January, 1992.
However, Pittsburgh School District employees like Zangrilli were
prohibited from selling products to the School District.
On September 28, 1989 -- one month before Zangrilli married
Donna Luke -- a corporation named A &D Mechanicals, Inc. (A&D) was
officially created, with Attorney Albert Zangrilli, Jr. as the
incorporator. The corporation's Registry Statement indicates that
Armand A. Zangrilli is its President and Donna Luke is its
Secretary - Treasurer. Luke has stated that the corporate Registry
Statement is erroneous in this regard. In any event, at the
corporation's organizational meeting, Luke was elected president,
secretary and treasurer of A &D. All of the corporate stock is
indicated as being owned by Luke.
Zangrilli, 92- 036 -C2
Page 131
A&D's sales to the Pittsburgh School District began in August
of 1989, about one month before A&D was incorporated. In 1989,
with only four months of sales to the PBOPE, A&D placed eighth out
of the twelve vendors who sold plumbing supplies to the PBOPE that
year, getting 4% of the total of that business. The next year,
1990, A&D rose to second place out of thirteen plumbing supply
vendors with 21.5% of the total of that business. Also, in October
of 1990, ADAM Specialty Supplies, Inc. (ADAM) began to do business
with the PBOPE. ADAM was not incorporated until approximately five
months later, on April 29, 1991, and once again, the corporation
was owned on paper by Donna Luke. In 1990, with only two months of
sales, ADAM placed ninth out of the thirteen vendors who sold
plumbing supplies to the PBOPE that year, getting 3.3% of the total
of that business. Combined, A&D and ADAM had 24.8% of the total of
that business. In 1991, A &D and ADAM placed second and third
respectively out of fourteen vendors who sold plumbing supplies to
the PBOPE, with combined sales equaling 35.3% of the total of that
business. The combined sales of A&D and ADAM greatly exceeded that
of any other plumbing supplier doing business with the PBOPE. From
August 21, 1989 through March 9, 1992, the total amount paid by the
PBOPE to A&D and ADAM was $230,945.98.
The Maintenance Division of the Pittsburgh School District has
numerous "trade shops," including the plumbing shop. During the
relevant period from August, 1989 through January, 1992, the
procedures for purchases for the trades area of the PSD including
the plumbing shop run by Armand Zangrilli were issued by Daniel
McConachie, the Director of PSD's Unit of Purchasing. The
procedures varied depending upon the dollar amount of a purchase.
Purchases over $4,000 had to be through formal competitive sealed
bids advertised in the newspapers. Purchases between $2,500 and
$4,000 required at least three written price quotations which were
to be obtained by persons other than trades personnel. These
purchases had to be approved by McConachie or his Assistant, Billie
Talak, later known as Billie Kruse. Purchases from $1,000 up to
$2,500 required one written price quotation. A tradesman could get
that quotation and it was within Zangrilli's authority as plumber
foreman to get such a price quotation. Finally, purchases under
$1,000 did not require any written price quotation, but they were
required to be authorized by either the Chief of Maintenance or by
the trades foreman for the trade making the purchase.
Purchases under $1,000 could be accomplished in one of two
ways. The items could be requisitioned in advance, through the
preparation of a Maintenance Materials Requisition Form, which
would then be submitted to a buyer in the purchasing office. The
tradesman could recommend a vendor, but could not force the buyer
to use that vendor. Alternatively, the tradesman could purchase
the needed items himself from the vendor and have the paperwork
prepared later. Under this procedure, the Purchasing Department
had no say in selecting the vendor.
Zangrilli, 92- 036 -C2
Page 132
The documents evidencing a particular purchase under $1,000
bear a unique identification number called a "purchase order
number" which is assigned to that purchase. The first part of the
number references the money being accessed for the purchase. The
second part of the number indicates the numerical sequence of this
purchase among other purchases against that money.
Armand Zangrilli testified that he ran "his shop," the
plumbing shop, and that he chose to do so by never filling out
Maintenance Materials Requisition Forms or seeing what his plumbers
ordered, but by allowing Rase or Purchasing to take care of
preparing these forms. Zangrilli stated that he never signed a
requisition for of any kind prior to January, 1992.
Zangrilli's name or nickname ( "Zang ") appears on fifteen
Maintenance Materials Requisition Forms, one proposal from A&D, and
one invoice from ADAM, from all of the documents evidencing the
sales by A&D and ADAM to the PBOPE. Zangrilli denied signing or
having anything to do with these documents. There is some evidence
that others wrote Zangrilli's name on at least some of these
documents.
Zangrilli denied requesting any materials or recommending any
vendors, including A&D and ADAM. Rase and Earl, individuals who
were involved in processing purchases, testified that Zangrilli did
request materials and did recommend A&D and ADAM for purchases by
the PBOPE. Evidence was also offered to show that Zangrilli used
the man hours, facilities and equipment of the School District for
A&D's private business purposes.
Zangrilli and Luke denied that Zangrilli has any ownership
interest in A&D or ADAM, or that Zangrilli acted on behalf of these
corporations. Various vendors and private individuals testified
that Zangrilli was involved in every phase of A&D's operations,
including placing orders with vendors and picking up those orders,
tendering payments on A &D's accounts, meeting with A&D customers,
giving estimates, doing jobs for A&D, and receiving payments for
A&D.
Finally, the Investigative Division has offered testimony and
various charts regarding its analysis of the voluminous and complex
documents in this case.
We begin our analysis of the specific issues and evidence in
this case by stating without reservation, that Armand Zangrilli is
not credible. The numerous examples evidencing Zangrilli's
complete lack of credibility are set forth at length in Finding 41
above and will not be repeated at length here. However, it will
suffice for purposes of this discussion to note that Zangrilli
either lied to this Commission in his testimony about his business,
Armand Zangrilli Plumbing, Heating and Air Conditioning, or he lied
Zanarilli, 92- 036 -C2
Page 133
in his declarations under penalty of perjury in bankruptcy
proceedings wherein he failed to disclose facts concerning that
business. Zangrilli's contradictory declarations simply cannot be
reconciled. Furthermore, Zangrilli's testimony before this
Commission within these proceedings is so riddled with
contradictions and attempts to evade straightforward questions as
to render him completely incredible. We are convinced that this
Respondent will avoid the truth, twist the truth, and deliberately
lie to further his own interests.
The threshold substantive issue which must be addressed is
whether Armand Zanarilli as the Plumber Foreman for the Pittsburgh
School District, was a "public employee" subject to Act 9 of 1989.
The statutory definition of the term, "public employee" is as
follows:
65__ P.$. 5402.
Section 2. Definitions
"Public employee." Any individual employed by
the Commonwealth or a political subdivision
who is responsible for taking or recommending
official action of a nonministerial nature
with regard to:
(1) contracting or procurement;
(2) administering or monitoring grants or
subsidies;
(3) planning or zoning;
(4) inspecting, licensing, regulating or
auditing any person; or
(5) any other activity where the official
action has an economic impact of greater
than a de minimis nature on the interests
of any person.
"Public employee" shall not include individ-
uals who are employed by the State or any
political subdivision thereof in teaching as
distinguished from administrative duties.
The Commission regulations at 51 Pa. Code list various factors
for determining status as a public employee, including inter alia:
whether the person makes final decisions; the degree to which the
person has the authority to forward or stop recommendations to the
person or body who makes final decisions; and whether the person
normally performs his responsibilities in the field without on -site
supervision.
We conclude that as Plumber Foreman for the Pittsburgh School
Zangrilli, 92- 036 -C2
Page 134
District, Armand Zangrilli was a "public employee" subject to the
Ethics Law. This conclusion is based upon Zangrilli's job
description and the testimony of Donahoe, McConachie, Preskar,
trades personnel and Zangrilli himself.
Coverage under the Ethics Law is to be construed broadly, and
it is the authority that a public employee has, rather than his
actual performance of duties, which is the objective test used to
determine whether the individual is subject to the Ethics Law.
Phillips v. State Ethics Com'n., 79 Pa. Commw. 491, 470 A.2d 659
(1984). Objectively, Zangrilli's job description sets forth duties
which fall squarely within the statutory definition of "public
employee" as well as the regulations of this Commission. Zangrilli
was responsible for taking or recommending official action of a
nonministerial nature with regard to activities in which his
official action had a greater than de minimis economic impact.
Zangrilli normally performed his responsibility in the field
without on -site supervision. He was to "make frequent visits to
school district buildings to review progress and quality of work."
Zangrilli gave final approval for most if not all of the work of
the plumbing shop.
Zangrilli was also responsible for taking or recommending
official action of a nonministerial nature with regard to
contracting or procurement. His job description included the
following: "oversees and assists in the requisitioning and /or
ordering of all equipment, materials and tools needed, while
working in close harmony with the materials expediter, purchasing
supervisor, stock room supervisor and tool room attendant." See
Finding lb).
We reject Zangrilli's argument that the Purchasing Department
had all of the control in this process. Zangrilli's authority and
responsibility was significant because the Plumber Foreman -- not
Rase, Nealy Earl, or the Purchasing Department -- would know what
materials would be needed for the PSD's approximately 12,000
plumbing jobs each year.
As for the tradesmen, Zangrilli had the final say and approval
as to the plumbing jobs. Under the procedures for purchasing, only
two people could authorize purchases under $1,000 for the plumbing
shop -- the Chief of Maintenance and Zangrilli. Zangrilli had the
authority and the duty to review Maintenance Materials Requisition
Forms and approve or disapprove them. The fact that Zangrilli did
not sign the forms does not alter the authority that Zangrilli had.
(We parenthetically note here that none of the plumbers signed
forms for purchases from A &D or ADAM). Zangrilli was given the
authority to select vendors and to order and obtain products,
because of his expertise as Plumber Foreman. For advance
requisitions Zangrilli had the authority to recommend vendors to
the buyer who made the final decision. Zangrilli also had the
Zangrilli, 92- 036 -C2
Page 135
authority to direct "in the field" purchases under $1,000 to
particular vendors. (See Findings if, 24(d), 30d(4),e)
Based upon all of the above, we conclude that Armand Zangrilli
as the Plumber Foreman for the Pittsburgh School District was a
"public employee" subject to the Ethics Law.
Respondent's arguments to the contrary are without merit.
Zangrilli has asserted that he did not participate in
preparing his job description and that he never received a copy of
it. Even if we believed this assertion, which we do not, Zangrilli
admitted that he ran "his shop" as he saw fit and that he "chose"
not to complete Maintenance Materials Requisition Forms or to see
what his plumbers ordered. Zangrilli clearly knew of his authority
-- with or without a job description.
Zangrilli claims that prior to January 9, 1992, trades foremen
were not required to sign Maintenance Materials Requisition Forms.
Zangrilli misreads McConachie's August 30, 1989 memorandum
pertaining to the purchase of supplies for use by the Maintenance
tradesmen, as providing purchasing guidelines for use by the
tradesmen. Closing Statement of the Respondent at 10. Respondent
cites this memorandum as requiring that the name of the tradesman
requesting the material be indicated. (I.D. 39 -3). The particular
reference Respondent cites, however, applies to warehouse stock
requests, not direct purchases, while the very next page of the
document clearly states that the signature of the trades foreman or
Chief of Maintenance is required to authorize direct purchases.
(See Finding 2 (f) (6)) .
Finally, Zangrilli engages in semantics, citing McConachie's
memorandum of January 9, 1992, which instituted changes in
procedures for open purchase orders (See Finding 41 ee(4)(a)(1)),
as establishing that the system was being "changed" to require the
signatures of the Chief of Maintenance or the trades foremen on
Maintenance Materials Requisition Forms. Although there were
changes effectuated by this later memorandum, the authority and
duty of the trades foremen to approve or disapprove Maintenance
Materials Requisition Forms was not one of these "changes" but had
existed throughout the relevant period (See Findings 2f, 2m). The
"change" effective January, 1992 was that Maintenance Materials
Requisition Forms which did not comply with that existing procedure
would no longer be processed.
Respondent's argument that the Board would not have instituted
these changes had it suspected him of wrongdoing is ludicrous. The
PBOPE had put a stop to doing business with A &D and ADAM at the
time these changes were instituted, and it was investigating
allegations involving Zangrilli's relationship to A &D and ADAM.
(See Finding 2n(1)). It would appear that these changes in
Zangrilli, 92- 036 -C2
Page 136
procedures may have been the direct result of suspected wrongdoing
by Zangrilli.
We must next determine whether Armand Zangrilli violated the
Ethics Law. Act 9 of 1989 requires "clear and convincing" proof
for finding a violation. 65 P.S. §408(g).
We shall first consider whether Armand Zangrilli used the
authority of his position as the Plumber Foreman for the Pittsburgh
School District in violation of Section 3(a) of the Ethics Law.
The elements for a Section 3(a) violation are the use of the
authority of the public position or confidential information
received in that position, for the private pecuniary benefit of the
public official /public employee himself, a member of his immediate
family, or a business with which he or a member of his immediate
family is associated.
As for Zangrilli's authority as Plumber Foreman, it is
important to keep in mind that the Plumber Foreman "oversees and
assists in the requisitioning and /or ordering of all equipment,
materials and tools needed, while working in close harmony with the
materials expediter, purchasing supervisor, stock room supervisor
and. tool room attendant.
As for the third element for a Section 3 (a) violation, A&D and
ADAM are businesses with which -- at the very least -- Zangrilli's
spouse, Donna Luke, is associated in her official capacities as
President, Secretary, Treasurer, and sole stock holder. See 65
P.S. §402. This element is fully satisfied -by Donna Luke's
association with A&D and ADAM. Any private pecuniary benefit to
Luke personally, or to Zangrilli, is merely the proverbial "icing
on the cake." To the extent that Zangrilli has strenuously denied
his own involvement with these corporations in the face of
overwhelming testimony by customers and suppliers of A&D that
Zangrilli was involved in every phase of A &D's operations --
placing orders, picking up supplies, and paying vendors for A&D;
giving estimates for A &D; performing installation and repair work
for A&D; and accepting payments for A &D -- all such testimony
merely serves to strengthen our conviction that Armand Zangrilli is
not credible, and that he recognized that the success of his scheme
to do business with the ,School District depended upon_ his
involvement being kept secret.
In reviewing the evidence, the mere presence of Zangrilli's
name on a Maintenance Materials Requisition Form, without more, is
not sufficient to establish that Zangrilli recommended the vendor
for the purchase. This is true in light of the evidence that other
individuals wrote Zangrilli's name or nickname on these forms and
also recommended vendors.
In a similar vein, we reject the Investigative Division's
Zangrilli, 92- 036 -C2
Page 137
suggestion that we find a violation of Section 3(a) merely because
Zangrilli ordered supplies for A&D which were subsequently sold to
the PBOPE. Such was not a use of authority of Zangrilli's public
position.
Violations of Section 3(a) have been established in several
instances, however.
Zangrilli violated Section 3(a) of the Ethics Law when he used
the authority of his position as plumber foreman to recommend to
Neely Earl, an expediter in the PSD's Unit of Purchasing, that he
use A&D or ADAM for purchases for the PBOPE (See Finding llh).
Zangrilli's recommendation to Earl was particularly significant
because Earl testified that if these companies had not been
recommended to him, he would not have sought them out on his own.
Therefore, as to Zangrilli's recommendation to Earl, it is clear
that Zangrilli's use of the authority of his office directly
resulted in a financial benefit to these businesses.
Zangrilli violated Section 3(a) of the Ethics Law when he used
the authority of his position as Plumber Foreman for the PSD to
recommend to Don Rase, a materials expediter in the PSD's
Facilities Office, that A&D be used for purchases for the PBOPE
(See Finding 6g) .
Zangrilli violated Section 3(a) of the Ethics Law when he
specifically recommended to Rase that the PBOPE purchase Model S25
Armstrong Pumps from A &D. Zangrilli stated that he wanted to
switch to Armstrong Pumps, and in recommending A&D as the vendor to
use, Zangrilli stated that A &D could get these pumps "cheaper and
quicker ". (See Finding 6k). Rase prepared Maintenance Materials
Requisition Forms dated September 1, 1989 for five of these pumps
as a result of Zangrilli's aforesaid use of authority of office.
The profit to A&D from these sales was $430.00. (See Findings 6k,
38h, and 42u(4)) .
Zangrilli violated Section 3(a) of the Ethics Law when he
specifically recommended to Rase that he purchase a trailer for the
PBOPE from A&D. Rase prepared a Maintenance Materials Requisition
Form dated June 18, 1990 for the purchase of the trailer by the
school district, at the request of Armand Zangrilli (See Finding 6
1). Rase got the information for this Maintenance Materials
Requisition Form directly from Armand Zangrilli. Armand Zangrilli
told Rase that this particular trailer was the trailer that he
wanted and that A &D could get it quickly and cheaply. This trailer
cost the PBOPE $985.00. (See Finding 6 1).
We conclude that a prohibited private pecuniary benefit
resulted from each of Zangrilli's aforesaid recommendations to
Rase. Although Rase stated that he would have "handled things" in
the same manner whether Zangrilli was involved with A &D or not,
Zangrilli, 92- 036 -C2
Page 138
this at most establishes that Rase felt no special loyalty for
Zangrilli. It in no way undermines the fact that Zangrilli's
recommendations of A&D and ADAM to Rase, particularly with regard
to the Armstrong Pumps and the trailer referenced above, directly
resulted in the use of these companies as the vendors from whom
these products were purchased.
The third witness who was directly involved in the purchasing
process was Ernest Miller (See Finding 25). Miller is not a
credible witness, particularly on the issue of why A&D and ADAM
were the designated vendors on hundreds of forms which he prepared
(See Findings 25 e, 25 i). Miller specifically reviewed 121
Maintenance Materials Requisition Forms which he prepared for
purchases from ADAM. Miller testified that the former Chief of
Maintenance, Charles McShane, specifically directed Miller to give
each of these purchases to ADAM. Of these 121 Maintenance
Materials Requisition Forms, 117 were dated after McShane's last
day on the job, with 65 of these forms bearing dates after
McShane's death. Miller similarly testified that McShane picked
A&D as the vendor for 217 Maintenance Materials Requisition Forms
which Miller prepared. Of these 217 Maintenance Materials
Requisition Forms, 77 were dated after McShane's last day on the
job, and 43 of these were dated after McShane's death. On further
questioning, Miller's testimony was that he had difficulty
recalling each of these purchases and that McShane gave him
directions on specific purchases on a "pretty regular basis."
Obviously, we do not believe that McShane directed Miller to
give each of these orders to A &D and ADAM, particularly those
orders which occurred after McShane was deceased. However, it is
possible that McShane made some such directions during his
lifetime. Rase also testified that McShane told him to utilize A&D
and ADAM.
We reject any assertion by Zangrilli that the plumbers who
worked below him recommended A&D or ADAM. The evidence clearly
establishes that the plumbers were not familiar with A&D or ADAM
and never made purchases from these companies. By process of
elimination, given that McShane was dead when many of these
purchases occurred, the evidence suggests that Zangrilli may have
used the authority of his office to recommend A &D and ADAM for
these purchases. However, it is also possible that Miller gave
some of these orders to A &D and ADAM on his own.
We cannot conclude on the evidence before us that Armand
Zangrilli used the authority of his office to recommend A &D and
ADAM for every one of these purchases.
With regard to the sale by A &D of wiping rags to the PBOPE,
however, the evidence establishes that a violation of Section 3(a)
of the Ethics Law did occur. Wiping rags are a stock item at the
Zangrilli, 92- 036 -C2
Page 139
PSD. (Finding 25c(2)). Miller was personally responsible for
maintaining wiping rags in stock. (Finding 25c). Wiping rags were
not ordered on a Maintenance Materials Requisition Form but rather
were ordered on a document known as a "Purchase Order." (Finding
25c). Miller was personally responsible for preparing these
purchase orders (Finding 25c(1)).
Although Billie Kruse was supposed to approve these purchase
orders, Miller stated that certain members of office staff signed
Kruse's name to the forms when Kruse was out of the office.
(Finding 25p).
Action Supply used to sell these wiping rags directly to the
Pittsburgh School District. John Black was Action supply's
representative who handled these sales. (Finding 28). Black
testified that in early 1990, while making a routine sales call to
the PBOPE, he was told that the Board had a new policy preferring
companies within the City of Pittsburgh. Miller told Black that
A&D was going to supply these rags to the School District, and that
Armand Zangrilli owned A&D. (See Finding 28b).
We believe the testimony of John Black that Armand Zangrilli,
Black, and Miller agreed upon an arrangement whereby A&D would
purchase wiping rags from Action Supply on the verbal release of
Ernie Miller, with the wiping rags being shipped by Action Supply
directly to the PBOPE but invoiced to A&D.
Our belief of Black's testimony does not hinge upon the fact
that Miller and Zangrilli are not credible (See Findings 25 u and
41 eee). Black had no reason to lie. Action Supply made the same
profit whether it sold the wiping rags directly to the PBOPE or
through A&D (Finding 28 g). The only conceivable motivation that
Black would have had to lie would be to deny any involvement with
Zangrilli in the hopes that Action Supply's business with the PBOPE
would not be adversely affected.
The documents evidencing these sales are most enlightening.
There are six documented transactions for sales of wiping rags by
A &D to the PBOPE where Action Supply shipped the rags directly to
the PBOPE and billed A &D (See Finding 25 o). These transactions
occurred between 4/03/90 and 10/18/91. There is no doubt that the
Findings set forth at Finding 25 o accurately match A &D's orders
from Action Supply to A &D' s corresponding sale to the PBOPE because
during this time period, there were no other sales of wiping rags
to the PBOPE by A &D. (Finding 25 0(7)).
Five of the six shipments occurred after the Zangrilli- Miller-
Black meeting. Each of these shipments was authorized by "Ernie."
Of course, Miller has denied ordering the rags from Action Supply
(Finding 25 o (8)) .
Zangrilli, 92- 036 -C2
Page 140
The very purchase orders that Miller prepared for these wiping
rags show that Miller did in fact contrive with Zangrilli to
circumvent the bidding process and direct these sales to A&D.
After the Zangrilli - Miller -Black arrangement had been struck,
with only one exception, each order of wiping rags was shipped to
the PBOPE before any purchase order was prepared, let alone
"approved." (See Finding 25 o).
Miller testified that for purchase orders, the number is
assigned by an individual other than Miller, and Miller receives
his copies by mail. (Finding 25c). Luke also testified that for
bids which had to be approved by Kruse, Luke had to wait for a copy
of the purchase order to come in the mail (Finding 42q(2)). If
these procedures were followed to any degree for these six orders
of wiping rags -- which is doubtful -- they merely "rubber stamped"
what Zangrilli and Miller had already done.
Any such "approval" would in no way undermine our conclusion
that a Section 3(a) violation occurred as to these six
transactions. The Plumber Foreman "oversees and assists in the
requisitioning and /or ordering of all equipment, materials and
tools needed, while working in close harmony with the ... stockroom
supervisor ...." Zangrilli used the authority of his position as
plumber foreman to contrive a scheme with Miller to direct these
particular orders to A&D. But for his position as plumber foreman,
Zangrilli would not have been in a position to do so. The
resulting private pecuniary benefit to A&D was $1,260.00 (See
Finding 25 o).
We shall now consider two proposals submitted by A&D to the
PBOPE, one of which indicated that it had been submitted to "A.
Zangrilli" followed by Zangrilli's telephone number at the PBOPE,
and the other of which did not indicate a name but listed two
telephone numbers, including the aforesaid number of Armand
Zangrilli (See Findings 41w(2), 41w(3)). The Exhibits documenting
the former of these transactions are identified as I.D. 29- 41 -44.
The Exhibits documenting the latter transaction are identified as
I.D. 29- 901 -902 and R10, page 6. We find that there is
insufficient evidence to establish a violation of Section 3(a) of
the Ethics Law as to either of these purchases.
As for the first transaction, we do not believe Luke's
testimony that Rase told Luke to put Zangrilli's name on the
proposal. Luke is not credible (Finding 42mm), and Rase testified
that he did not so instruct Luke and that he never had occasion to
instruct vendors in drafting their proposals (See Finding 6j).
It seems likely that Zangrilli, who is heavily involved with
A &D, was aware of this proposal which was the first, or one of the
first, submitted by A &D to the PBOPE. However, Luke may well have
Zangrilli, 92- 036 -C2
Page 141
put Zangrilli's name on the proposal of her own volition.
The second proposal, which merely lists Zangrilli's telephone
number at the PBOPE as one of two numbers, is clearly insufficient
to establish a violation.
We shall next consider a Maintenance Materials Requisition
Form for a purchase from A&D which bears the typewritten name
"Armand Zangrilli" on the "Requested by" line, and the handwritten
initials "A.Z." (See Finding 41 w(4) regarding I.D. 29- 1006). It
is quite possible that Zangrilli personally initialled this form.
Despite Zangrilli's conflicting testimony as to how he signed his
name on PBOPE related documents (See Finding 41 eee(7)), by his own
admission Zangrilli initialled rather than signed at least one
other document (See Finding 41 ee).
However, the vendor may have been recommended by someone else.
We note that this particular document bears typewritten and
handwritten notations, and various signatures, such that it is
impossible to conclude as to this form, who did what.
We turn now to the allegation that Zangrilli used the
authority of his position as plumber foreman to use school district
equipment and materials for private business purposes. Based upon
the evidence which is before us, we conclude that Armand Zangrilli
did violate Section 3(a) of the Ethics Law when he used the
authority of his office to direct John Nee to pick up supplies for
A &D from various vendors on school district time in a school
district vehicle. Our conclusion is supported by the testimony of
John Nee. (See Finding 31). Nee identified his signature on
numerous vendor invoices /packing slips as the person who picked up
orders for A&D. Nee testified that Armand Zangrilli, as Nee's
supervisor, directed him to pick up these supplies in the course of
Nee's employment.
Luke acknowledged that Nee picked up items for A&D and ADAM.
Her explanation was that there were times that she could not pick
up the orders and told PBOPE staff that if there was an emergency,
"they" were free to pick up the orders (See Finding 42s) . This
explanation is unbelievable and it does not alter the fact that PSD
man hours and equipment were used for the private pecuniary benefit
of A &D, at Zangrilli's discretion.
Zangrilli acknowledged that John Nee picked up supplies from
vendors in a school district vehicle, but stated that these
supplies were for the PBOPE. (See Finding 41 1). Perhaps
Zangrilli was engaging in semantics yet again, since the supplies
were ultimately destined for the PBOPE. In any event we need
merely reiterate that Zangrilli is not credible and we do not
believe him.
Zangrilli, 92- 036 -C2
Page 142
Similarly, Armand Zangrilli used the authority of his position
to use School District man hours and facilities in violation of
Section 3(a) of the Ethics Law by arranging for Ernest Miller to
handle telephone calls from Black -- on School District time using
School District telephones -- so that Miller could give verbal
releases on behalf of A&D to Action Supply, and so that wiping rags
would be shipped directly to the PBOPE without any effort by A&D.
A&D did nothing but reap the profit from these sales.
As for the allegation that Zangrilli used the authority of his
position to order, purchase, or requisition supplies and material
for the PSD from a member of his immediate family or a business
with which he was associated, which materials and supplies it is
alleged were paid for by the PBOPE but never received, we do not so
find. The Investigative Division's case on this issue hinged upon
the implication that if a corresponding vendor invoice could not be
located to establish that A&D or ADAM actually had such a supply --
that it actually existed -- then the supply did not exist. Thus,
the PBOPE would have paid for a supply which it did not receive.
Problems with this theory, as Bender acknowledged, are that there
may have been cash purchases for which there would be no vendor
invoice; there may have been vendors who were not identified by the
Investigative Division; or a vendor's records could be incomplete
such that vendor invoices could be missing.
Donna Luke testified that she did in fact make cash purchases.
Specifically with regard to Armstrong Pumps, Luke testified that
she bought seventeen or eighteen pumps at the Andover auction in
1990 and 1991. (See Finding 42 u(2)(c)).
Luke is not a credible witness. Without reiterating the many
reasons that Luke is not credible (See Finding 42mm), we reference
Luke's contrived arrangement with Tom Timlin, whereby Timlin would
work for A&D without being an A &D employee on paper, so that
Timlin's divorce proceeding and workmen's compensation would not be
adversely affected. Given Luke's willingness to contrive such an
arrangement with a third party, there is little doubt that she
would be equally creative where her own interests are at stake.
Nevertheless, even after rejecting Luke's testimony as not
credible, there is insufficient evidence to support a violation for
supplies not received by the PBOPE.
There was one particular pertinent sale to the PBOPE of a
Model S25 Armstrong Pump for which a corresponding vendor invoice
could not be located. The profit from that sale has therefore been
calculated by giving the benefit of the doubt to the Respondent.
(See Finding 38h).
The next issue is whether Section 3(f) of the Ethics Law was
violated when A &D and ADAM contracted with the school district
Zangrilli, 92- 036 -C2
Page 143
without an open and public process. We find that Section 3(f) of
the Ethics Law was violated repeatedly, when ADD and ADAM
repeatedly contracted with the PBOPE for amounts of $500 or more
without an open and public process. (See Finding 2d). These
purchases were made without any prior or subsequent public
notification, often with no quotations, or with two or fewer other
quotations. Only purchases in excess of $4,000 were processed with
prior public notice. (See Findings 2f -g).
For purposes of this discussion, it is not necessary to
specifically enumerate each such violation. However, we would
highlight the purchases set forth in Finding 38j which clearly
evidence contract fragmentation. In each of these instances, there
were multiple requisitions submitted on the same date for the same
item from the same vendor. In each of these instances, the only
conceivable reason for these multiple requisitions would be to
circumvent PBOPE procedures which applied to purchases of $1,000 or
more. In fragmenting these contracts, the lower threshold of $500
set forth in Section 3(f) of the Ethics Law was not taken into
account. With only one exception, each of the individual
requisitions exceeded the $500 threshold such that each
requisition, even individually, was required to go through an open
and public process under the Ethics Law.
Finally, we address Zangrilli's failure to file Statements of
Financial Interests for the 1989, 1990 and 1991 calendar years.
Zangrilli has admitted that he did not file these Statements of
Financial Interests, but has contended that he was not required to
file them. We conclude to the contrary, based upon our decision
that Zangrilli, as a Plumber Foreman for the Pittsburgh School
District, was a "public employee" subject to the Ethics Law.
Therefore we conclude that Armand Zangrilli violated Section 4(a)
of the Ethics Law when he failed to file Statements of Financial
Interests for calendar years 1989, 1990 and 1991.
As for Zangrilli's alleged ignorance of the Ethics Law,such
does not preclude our finding him to be in violation of that law.
Furthermore, in this case, we have no doubt that Zangrilli acted
deliberately and in bad faith.
We also reject Zangrilli's argument that he should not be
found in violation of the Ethics Law just because the private
pecuniary benefit received was a smaller profit than another vendor
would have made on the sales. A public official /public employee
may not engage in illegal self dealing simply because he gives the
governmental body a "good deal" in the process. See, Harper,
Opinion 94 -001. A "good" illegal deal is still an illegal deal.
We will now consider the issue of restitution. Section 7(13)
of the Ethics Law, 65 P.S. §407(13), provides that an Order of this
Commission may include recommendations to law enforcement
Zangrilli, 92- 036 -C2
Page 144
officials, and that, "Any Order resulting from a finding that a
public official or public employee has obtained a financial gain in
violation of this act may require the restitution plus interest of
that gain to the appropriate governmental body."
We conclude that restitution by Zangrilli to the PBOPE is
appropriate and warranted under the facts and circumstances of this
case, which evidence a reprehensible violation of the public trust
by Zangrilli.
Zangrilli is ordered to make timely restitution through this
Commission payable to the Pittsburgh Board of Public Education in
the amount of $1,690. This figure is the profit realized by A&D
for the five Model S25 Armstrong Pumps discussed in Finding 38h and
the six sales of wiping rags discussed in Finding 25 0.
To the extent Zangrilli is concerned that any "damages"
account for A&D's and ADAM's operating costs in these illegal
transactions (See, Closing Statement of Respondent at 22), the
offsetting of an operating cost can itself constitute a private
pecuniary benefit. See, Freind, Order 800; Harper, Opinion 94 -001.
In any event, we note that there were no operating costs for
the sales of the wiping rags -- Action Supply and Miller did all of
the work for A&D -- and any costs incurred for picking up the five
Armstrong pumps would be minimal.
Section 9(c) of the Ethics Law provides:
65 P.S. §409 (c) .
Section 9. Penalties.
(c) Any person who obtains financial gain from
violating any provision of this act, in
addition to any other penalty provided by law,
shall pay into the State Treasury a sum of
money equal to three times the financial gain
resulting from such violation.
In the instant matter, a treble penalty is also warranted. As
noted above, the financial gain that we can discern with certainty
amounts to $1,690.00. We will impose a treble penalty in the
amount of $5,070.00, which penalty is in addition to the award of
restitution.
This Commission will only impose a treble penalty under
Section 9(c) where there is clear and convincing evidence of a
discernable financial gain; a use of office to obtain said gain and
intentional, blatant, extraordinary and /or exceptional
circumstances whereby the conduct, based on all relevant factors,
Zangrilli, 92- 036 -C2
Page 145
warrants such action. See Helsel, Order 801. We believe that such
circumstances are present. The egregious nature of Zangrilli's
conduct, including his deliberate and scheming attempts to conceal
what he was doing, demands a treble penalty.
Zangrilli is ordered to pay a treble penalty through this
Commission payable to the order of the Commonwealth of Pennsylvania
in the amount of $5,070.00, for deposit in the State Treasury.
If there is any injustice to our decision, it is that we are
unable to order restitution and a treble penalty in sufficient
amounts to reflect the appalling self - dealing of this public
employee.
Based upon a review of the entire record, we will also refer
this matter to the appropriate law enforcement authority with our
recommendation that a criminal prosecution be instituted.
Section 9(e) of the Ethics Law provides in part that any
person who willfully affirms or swears falsely in regard to any
material matter before a Commission proceeding pursuant to Section
8 is guilty of a felony and shall be fined not more than $5,000 or
imprisoned for not more than five years or be both fined and
imprisoned.
During the course of this proceeding, certain statements were
taken under oath including that of Mr. Zangrilli, which statements
are contradicted by the facts as previously outlined.
Therefore, we are also referring this matter for review as to
whether there have been any violations of Section 9(e) of the
Ethics Law or of the perjury or false swearing provisions of the
Crimes Code.
Additionally, we are also referring this matter for review as
to whether any other laws have been implicated in relation to
Zangrilli or other individuals involved in this matter.
IV. CONCLUSIONS OF LAW:
1. Armand A. Zangrilli as Plumber Foreman for the Pittsburgh
School District (PSD) was a public employee subject to the
Ethics Law.
2. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A &D Mechanicals,
Inc. ( " &D ") and ADAM Specialty Supply, Inc. ( " ADAM "),
businesses with which Zangrilli's spouse is associated, by
recommending to Nealy Earl, an expediter in the PSD's Unit of
Zangrilli, 92- 036 -C2
Page 146
Purchasing, that he use A&D and ADAM for purchases for the
Pittsburgh Board of Public Education ( "PBOPE ").
3. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by recommending
to Don Rase, a materials expediter in the PSD's Facilities
Office, that A&D be used for purchases for the PBOPE.
4. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by recommending
to Don Rase, a materials expediter in the PSD's Facilities
Office, that A&D be used for purchases of five Model S25
Armstrong Pumps ordered September 1, 1989 for the PBOPE.
a. The private pecuniary benefit received by A&D for these
pumps was $430.00.
5. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by recommending
to Don Rase, a materials expediter in the PSD's Facilities
Office, that A&D be used for the purchase of a trailer ordered
June 18, 1990 for the PBOPE.
a. The private pecuniary benefit received by A&D for this
trailer cannot be determined.
6. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by directing six
purchases to A&D for wiping rags ordered by the PBOPE on April
30, 1990, June 27, 1990, October 2, 1990, February 1, 1991,
April 26, 1991, and October 18, 1991.
a. The private pecuniary benefit received by A&D from these
sales was $1,260.00.
7. Armand Zangrilli did not violate Section 3(a) of the Ethics
Law by the mere appearance of his name and /or telephone number
on two A &D proposals dated August 17, 1989 and March 21, 1991,
as having received the proposal for the Board.
8. Armand Zangrilli did not violate Section 3(a) of the Ethics
Law as to a particular purchase by the mere appearance of his
typewritten name and handwritten initials on a Maintenance
Zangrilli, 92- 036 -C2
Page 147
Materials Requisition Form dated July 19, 1991, along with
other names and notations.
9. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by directing John
Nee, a plumber laborer for the PBOPE, to pick up supplies for
A&D from various vendors on School District time in a School
District vehicle.
10. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by arranging for
Ernest Miller, a "Storekeeper I" employed by the PSD, to act
on behalf of A&D to authorize five of six shipments from
Action Supply, A&D's supplier of wiping rags, directly to the
PBOPE.
11. Armand Zangrilli did not violate Section 3(a) of the Ethics
Law by using the authority of his public position as Plumber
Foreman for the PSD to order, purchase or requisition supplies
and materials for the PSD which were paid for but not
received, based upon an insufficiency of evidence.
12. Armand Zangrilli did not violate Section 3(a) of the Ethics
Law by ordering supplies for A&D, a business with which
Zangrilli's spouse is associated, which supplies were
subsequently sold to the PBOPE.
13. Armand Zangrilli violated Section 3(f) of the Ethics Law when
A&D and ADAM, businesses with which Zangrilli's spouse is
associated, repeatedly entered into contracts with the PBOPE
valued at $500 or more without an open and public process.
14. Armand Zangrilli violated Section 4(a) of the Ethics Law when
he failed to file Statements of Financial Interests for the
1989, 1990 and 1991 calendar years.
_15. An order directing Armand Zangrilli to pay both restitution
and a treble penalty is warranted under the facts and
circumstances of this case.
In Re: Armand Zangrilli File Docket: 92- 036 -C2
Date Decided: 09/12/94
Date Mailed: 09/21/94
ORDER NO. 946
1. Armand A. Zangrilli as Plumber Foreman for the Pittsburgh
School District (PSD) violated Section 3(a) of the Ethics Law
when he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D Mechanicals,
Inc. ( "A&D ") and ADAM Specialty Supply, Inc. ( "ADAM "),
businesses with which Zangrilli's spouse is associated, by
recommending to Neely Earl, an expediter in the PSD's Unit of
Purchasing, that he use A&D and ADAM for purchases for the
Pittsburgh Board of Public Education ( "PBOPE ").
2. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by recommending
to Don Rase, a materials expediter in the PSD's Facilities
Office, that A&D be used for purchases for the PBOPE.
3. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by recommending
to Don Rase, a materials expediter in the PSD's Facilities
Office, that A&D be used for purchases of five Model S25
Armstrong Pumps ordered September 1, 1989 for the PBOPE.
a. The private pecuniary benefit received by A&D for these
pumps was $430.00.
4. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by recommending
to Don Rase, a materials expediter in the PSD's Facilities
Office, that A&D be used for the purchase of a trailer orde ;ed
June 18, 1990 for the PBOPE.
a. The private pecuniary benefit received by A &D for this
trailer cannot be determined.
5. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A &D, a business
with which Zangrilli's spouse is associated, by directing six
purchases to A&D for wiping rags ordered by the PBOPE on April
30, 1990, June 27, 1990, October 2, 1990, February 1, 1991,
April 26, 1991, and October 18, 1991.
a. The private pecuniary benefit received by A&D from these
sales was $1,260.00.
6. Armand Zangrilli did not violate Section 3(a) of the Ethics
Law by the mere appearance of his name and /or telephone number
on two A&D proposals dated August 17, 1989 and March 21, 1991,
as having received the proposal for the Board.
7. Armand Zangrilli did not violate Section 3
Law as to a particular purchase by the mere
typewritten name and handwritten initials
Materials Requisition Form dated July 19,
other names and notations.
(a) of the Ethics
appearance of his
on a Maintenance
1991, along with
8. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by directing John
Nee, a plumber laborer for the PBOPE, to pick up supplies for
A&D from various vendors on School District time in a School
District vehicle.
9. Armand Zangrilli violated Section 3(a) of the Ethics Law when
he used the authority of his public position as Plumber
Foreman for the private pecuniary benefit of A&D, a business
with which Zangrilli's spouse is associated, by arranging for
Ernest Miller, a "Storekeeper I" employed by the PSD, to act
on behalf of A&D to authorize five of six shipments from
Action Supply, A&D's supplier of wiping rags, directly to the
PBOPE.
,10. Armand Zangrilli did not violate Section 3(a) of the Ethics
Law by using the authority of his public position as Plumber
Foreman for the PSD to order, purchase or requisition supplies
and materials for the PSD which were paid for but not
received, based upon an insufficiency of evidence.
11. Armand Zangrilli did not violate Section 3(a) of the Ethics
Law by ordering supplies for A &D, a business with which
Zangrilli's spouse is associated, which supplies were
subsequently sold to the PBOPE.
12. Armand Zangrilli violated Section 3(f) of the Ethics Law when
A &D and ADAM, businesses with which Zangrilli's spouse is
associated, repeatedly entered into contracts with the PBOPE
valued at $500 or more without an open and public process.
13. Armand Zangrilli violated Section 4(a) of the Ethics Law when
he failed to file Statements of Financial Interests for the
1989, 1990 and 1991 calendar years.
14. An order directing Armand Zangrilli to pay both restitution
and a treble penalty is warranted under the facts and
circumstances of this case.
15. Armand Zangrilli is directed within thirty (30) days of the
date of issuance of this Order to submit restitution in the
amount of $1,690.00 to this Commission payable to the order of
the Pittsburgh Board of Public Education.
16. Armand Zangrilli is directed within thirty (30) days of the
date of issuance of this Order to submit payment of a treble
penalty in the amount of $5,070.00 to this Commission payable
to the order of the Commonwealth of Pennsylvania for deposit
in the State Treasury.
17. Armand Zangrilli is directed within thirty (30) days of the
date of issuance of this Order to file Statements of Financial
Interests for calendar years 1989, 1990 and 1991 with the
Pittsburgh School District, and to forward copies of same to
this Commission evidencing compliance to the following
address:
Commonwealth of Pennsylvania
State Ethics Commission
P.O. Box 11470
Room 309, Finance Building
Harrisburg, PA 17108 -1470
18. Failure to comply with Paragraph 14, 15, 16 or 17 will result
in the institution of an order enforcement proceeding.
19. This matter will also be referred to the appropriate law
enforcement authority for review as to whether any individual
may have violated other sections of the Ethics Law, the Crimes
Code or other laws.
BY THE COMMISSION,
Commissioner Dennis C. Harrington abstained as to the decision of
this matter.