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HomeMy WebLinkAbout1002 LavertueSTATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 In Re: David Lavertue File Docket: 95- 047 -C2 Date Decided: 5/30/96 Date Mailed: 6/12/96 Before: Daneen E. Reese, Chair Austin M. Lee, Vice Chair Roy W. Wilt Allan M. Kluger Rev. Joseph G. Quinn This is a final adjudication of the State Ethics Commission. • Procedurally, the Investigative Division of the State Ethics Commission conducted an investigation regarding a possible violation of the Public Official and Employee Ethics Law, Act 9 of 1989, P.L. 26, 65 P.S. §401 el seq., by the above - named Respondent. At the commencement of its investigation, the Investigative Division served upon Respondent written notice of the specific allegation(s). Upon completion of its investigation, the Investigative Division issued and served upon Respondent a Findings Report identified as an "Investigative Complaint." An Answer was filed and a hearing was waived. The.record is complete. A consent agreement was submitted by the parties to the Commission for consideration which was subsequently approved. This adjudication of the State Ethics Commission will be made available as a public document thirty days after the mailing date noted above. However, reconsideration may be requested. Any reconsideration request must be received at this Commission within thirty days of the mailing date 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). A request for reconsideration will not affect the finality of this adjudication but will defer its public release pending action on the request by the Commission. The files in this case will remain confidential in accordance with Act 9 of 1989, 65 P.S. §408(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. §409(e). Confidentiality does not preclude discussing this case with an attorney at law. Lavertue, 95- 047 -C2 Page 2 I. ALLEGATION: That David Lavertue, a public official in his capacity as a supervisor for Carroll Township, York County, violated Sections 3(a) and 3(f) of the State Ethics Act (Act 9 of 1989) when he used the authority of his office for the private pecuniary benefit of himself and /or a company with which he is associated by decisions and other actions of the township to contract with the �township for the sale of fuel oil and stone hauling; when he participated in actions to pay township funds to a business with which he was associated; when he obtained confidential information in an effort to obtain a contract between the township and a business with which he was associated; and when such contracting for such oil and stone hauling was done without an open and public process. II. FINDINGS: 1. David Lavertue has served as a Carroll Township Supervisor since January 1988. a. He also served on the Township Planning Commission during the 1980's. 2. During the time period from 1990 to the present, Carroll Township has had three other elected supervisors. a. Norman Shelly has held office since January 1990. 1. Supervisor Shelly was the supervisor in charge of road related affairs, including awarding business to companies that submitted the low quotes in fuel delivery and stone hauling matters. b. Thomas Carl has held office since January 1992. c. Larry Eichelberger held office from January 1973 until December 1991, and was replaced by Thomas Carl 3. Lavertue is the owner of Shillito Oil Company. a. Lavertue has been the owner of Shillito Oil Company since August of 1990. b. The previous owner, Esther Warhime, owned Shillito Oil Company from 1984 to August 1990. c. Russ Shillito owned Shillito Oil Company from the 1940's until his death in 1984. 4. Shillito Oil Company provided number 2 fuel oil to heat the Carroll Township Building on a continuing basis from May 1987 until January 1994. a. Carroll Township did not seek bids on number 2 fuel oil during this time period. b. There was no written agreement between Carroll Township and Shitlito Oil Company for the delivery of number 2 fuel oil. Lavertue, 95- 047 -C2 Page 3 c. Shillito would deliver the fuel oil and then submit an invoice to the township. d. Carroll Township regularly paid the invoices submitted by Shillito Oil Company, during this time period, in the same manner as it had done before Lavertue had an ownership interest in Shillito. e. At no time during the period from August of 1990 through January 3, 1994, did Lavertue provide direction to any township employee concerning the purchase of oil by the township from Shillito and did not participate in any way in the order of the oil or preparation of township documents relating to payments for the oil which was delivered by Shillito, all of which functions were performed independently by township personnel. 5. In January of 1994, Supervisor Thomas Carl raised concerns over the fact that the supply of fuel oil for the township building had never been put out for bid. • 6. Minutes of the Carroll Township Supervisors' Meeting of January 3, 1994, reflect the following activity: a. Fuel Oil for Township Buildina - Moved by Supervisor Carl, seconded by Supervisor Lavertue and unanimously carried to advertise for sealed bids for fuel oil for the 1994 heating season for the township municipal building. This vote was then unanimously rescinded. Moved by Carl, seconded by Shelly, and unanimously carried to have the Secretary/Treasurer call three oil dealers to get pricing as needed and to purchase at the lower price per gallon. Supervisor Lavertue abstained from the vote. 7. Carroll Township Secretary /Treasurer Faye Romberger subsequently obtained two quotes on the purchase of number 2 fuel oil for the township building. a. Romberger believes the quotes were obtained from either Agway, Susquehanna Oil or Shipley Oil Company. 8. Romberger then engaged in a telephone conversation with Lavertue. a. Lavertue inquired as to the amounts of the two quotes she had thus far received. b. Romberger provided this information to Lavertue. c. .Bomberger felt obligated to reveal this information to Lavertue because he was a township supervisor. d. The information provided by Romberger was not obtainable from reviewing public documents or from making inquiry to publicly available sources of information. 9. Lavertue then submitted a price quote, on behalf of Shillito Oil Company, on number 2 fuel oil to Romberger. Lavertue, 95- 047 -C2 Page 4 a. This price quote was lower than the other quotes submitted to Romberger. b. Lavertue submitted his price quote after having obtained knowledge of other quotes obtained by Romberger. 10. Shillito Oil Company was subsequently chosen by Supervisor Shelly to provide number 2 fuel oil to Carroll Township based upon the price quote submitted by David Lavertue. a. Shelly authorized business with companies that submitted low quotes. 11. The delivery of number 2 fuel oil that resulted from the facts described in Findings Nos. 7 -10 was documented in Shillito Oil Company invoice 19943 in the amount of $271.04, which was submitted to Carroll Township. a. Lavertue voted to approve payment of invoice 19943 at the Carroll Township Supervisors meeting of February 1, 1995. (See Finding No. 14) b. This invoice was paid for by Township General Fund Check No. 3421 dated February 2, 1994, in the amount of $787.37, made payable to Shillito Oil Company. (See Finding No. 13) 12. Invoices submitted by Shillito Oil Company to Carroll Township for the delivery of number 2 fuel oil since Lavertue purchased the company in August 1990, indicate that the following amounts fuel oil were delivered. Delivery Date Gallons 12/11/90 262.8 12/31/90 283.0 01/15/91 280.0 02/05/91 385.0 02/19/91 214.5 03/19/91 360.0 04/30/91 315.1 07/11/91 84.5 11/04/91 300.2 12/10/91 425.1 12/23/91 210.1 01/07/92 235.7 01/21/92 266.9 02/04/92 258.0 02/18/92 308.1 03/04/92 224.5 03/24/92 309.3 05/05/92 397.1 11/04/92 476.2 12/01/92 347.3 12/16/92 250.3 01/06/93 345.0 01/20/93 292.9 02/03/93 311.0 Lavertue, 95- 047 -C2 Page 5 * This delivery of number 2 fuel oil is the one described in Findings 7 -1 1. 13. Carroll Township Vendor Records reflect the following payments were made from the Township General Fund Account to the Shillito Oil Company for delivery of number 2 fuel oil during the time period of November 1990 to April 1994. Check Number Date 1666 1756 2496 2578 2784 2816 Delivery Date 02/16/93 03/02/93 03/16/93 03/30/93 05/04/93 09/29/93 11/17/93 12/08/93 12/28/93 01/11/94 03/07/94 03/ ? ?/94 TOTAL GALLONS 12/26/90 02/20/91 1795 03/07/91 1853 04/04/91 1907 05/08/91 2037 07/17/91 2187 11/08/91 2260 12/30/91 2403 04/08/92 06/03/92 08/05/92 12/08/92 12/28/92 2883 02/03/93 2951 04/05/93 Amount of Check * Invoice + $ 866.50 $1,492.74 $ 257.00 $ 342.00 $ 560.47 $ 303.06 $ 365.61 $ 677.88 $2,144.15 $ 882.98 $ 244.73 $ 685.25 $ 503.26 $ 793.95 $ 825.51 11/30/90 12/31/90 01/31/91 01/31/91 02/28/91 6881 7418 06/30/91 07/10/91 8577 9002 01/31/92 02/29/92 03/24/92 03/24/92 05/05/92 08/03/92 11/30/92 13953 14316 01/31/93 02/28/93 02/28/93 Gallons 283.2 350.0 238.1 248.0 245.4 200.0 392.1 246.0 375.0 352.0* 325.0 300.1 10,697.5 Invoice Description Supervisors Supervisors/ Heating Oil Supervisors/ Heating Oil Supervisors/ Heating Oil Supervisors/ Heating Oil Carroll Twp. Supervisors Heating Oil 7973 -011 Fuel Oil Heating Oil Fuel OiI Fuel Oil Fuel Oil 11255 Fuel Oil 11682 Fuel Oil Fuel Oil 9504 Fuel Oil Bldg Fuel OiI Fuel Oil Fuel Oil 14834 Fuel Oil Fuel Oil Fuel Oil Amount of of Invoice $621.98 $635.78 $334.34 $423.50 $246.21 $ 342.00 $270.98 $191.34 $ 64.22 $255.17 $382.59 $452.34 $519.76 $202.05 $275.88 $362.50 $194.81 $395.25 $ 288.26 $215.00 $296.70 $516.95 $ 249.47 Lavertuq, 95- 047 -C2 Page 6 Check Amount Number Date of Check* Invoice + 3002 05/13/93 $2,096.93 17229 03/31/93 3229 10/06/93 $ 234.31 09/30/93 3337 12/07/93 $ 282.31 11/30/93 3369 12/28/93 $ 184.50 18877 3421 02/02/94 $ 787.37 Jan '94 Jan '94 3540 04/06/94 $1,918.01 21684 04/01/94 Date of Meetina Check Number N/A 1666 02/20/91 1756 03/07/91 1795 04/04/91 1853 05/07/91 1907 07/16/91 2037 11/07/91 2187 12/26/91 2260 04/07/91 2403 06/02/92 2496 08/04/92 2578 12/07/92 2784 N/A 2816 N/A N/A Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Invoice Description Fuel Oil Fuel Oil Heating Oil Heating Fuel Heating Oil 19310 Fuel Oil 19943 Fuel Oil Heating Oil 22070 - Heating Oil TOTAL FOR FUEL OIL DELIVERY Amount of of Invoice $213.50 $739.79 $144.00 $282.31 $184.50 $281.25 $271.04@ $256.75 $234.08 $10,343.20 * Checks where the amount shown is greater than that listed in the invoice(s) also included payment to Shillito for other services provided by the company. • + The actual delivery dates on Shillito's invoices differ from the invoice dates listed in Carroll Township's Vendor Records as invoice /invoice date. @ This invoice regards the January 11, 1994, delivery of number 2 fuel oil described in Findings 7 -1 1. 14. Minutes of the Carroll Township Supervisors Meetings indicate that votes approving the issuance of checks to ' Shillito Oil Company relating to invoices for the delivery of fuel oil, were made as to a group of bills presented to the Board for payment on the following dates. Action by Vote Lavertue N/A Voted Made Motion, Voted Voted Voted Voted Made Motion, Voted Seconded Motion, Voted Made Motion, Voted Voted Seconded Motion, Voted Made Motion, Voted N/A Levert - 95- 047 -C2 Page 7 Date of Check Action by Meeting Number Vote Lavertue 02/02/93 2883 Unanimous Voted N/A 2951 N/A N/A 05/04/93 3002 Unanimous Made Motion, Voted 10/05/93 3229 Unanimous Made Motion, Voted 12/07/93 3337 Unanimous Made Motion, Voted 12/28/93 3369 Unanimous Made Motion, Voted 02/01/94 3421 Unanimous Voted* 04/05/94 3540 Unanimous Voted * This vote approved payment for the delivery dated January 1994, • in the amount of $271.04 described in Findings 7 -1 1. Township records reflect this as the first purchase of number 2 fuel oil from Shillito Oil Company after the Supervisor's Meeting of January 3, 1994. 15. In 1994, Agway Energy Products was awarded three quotes to provide number 2 fuel oil to the township building. Check Date of Date of Number Check Delivery Amount 3441 03/02/94 02/17/94 $415.89 3667 07/06/94 06/17/94 $220.05 3919 12/07/94 Not Indicated $302.67 16. Agway and Shillito Oil Company were the only two businesses awarded quotes for number 2 fuel oil during calendar year 1994. a. Other businesses were quoted, but did not present the lowest quote. 17. Shillito Oil Company received the following amounts on a yearly basis from Carroll Township for the delivery of number 2 fuel oil to the township building: 1990 1991 1992 1993 1994 TOTAL $ 621.98 $ 3,146.13 $ 2,905.85 $ 2,627.22 $ 1 ,043.12 $ 10,343.20 18. Lavertue, when interviewed, stated that at current prices he pays $.6075 per gallon for number 2 fuel oil and charges his customers $.93 per gallon, which amounts to an approximate gross profit of $.30 per gallon. Lavertue, 95- 047 -C2 Page 8 a. Lavertue then pays insurance costs, workers compensation, and compensation to the driver of the delivery truck, which lowers his profit to approximately $.15 per gallon. b. Lavertue additionally provided Carroll Township with a discount of between $.04 and $.05 per gallon, which would lower his net profit margin to approximately $.10 to $.11 per gallon. c. Lavertue stated that he would be willing to reimburse Carroll Township $.30 per gallon for the January 1994 delivery of fuel oil. 19. Lavertue estimated that he made $ .10 net profit per gallon of fuel oil delivered to Carroll Township. (See Finding No. 18) a. Between December 1990 and April 1994, Shillito Oii Company delivered 10,697.5 gallons of number 2 fuel oil to Carroll Township. (See Finding No. 12) b. 10,697.5 gallons delivered x .10 net profit per gallon $1,069.75 net profit 20. Carroll Township routinely purchased stone from various sources as material for use in roadwork projects. a. Purchases were usually made from Hempt Brothers or Pennsy Supply, which were the largest suppliers in the area. 21. Minutes of the Meeting of Carroll Township Supervisors of July 6, 1993, indicate that bids for road material were opened and the awards announced. a. Bids for 400 tons. more or Tess - ID -2 Wearing„Road Material Supplier Pennsy Supply Hempt Brothers Wilson Paving FOB Plant $20.05 $17.75 $19.00 Delivered Cad Job Site $25.05 $19.90 $22.50 b. Hempt Brothers received the award as the lowest bidder, on the basis of its FOB Plant bid of $17.75 per ton. 22. The "FOB Plant" Price indicated is the cost per ton of road material without delivery provided by the supplier. a. The "delivered at job site" price indicated is the cost per ton of road material when delivered to a particular location by the supplier. 23. Every time Carroll Township purchased stone, the township would make separate arrangements to have the stone picked up and delivered. 24. A quote system was also used to award the hauling of stone picked up from Hempt. Lavertue, 95- 047 -C2 Page 9 a. Shillito Oil Company, Larry Altland Excavating, Womax Excavating Company, Larry Eichelberger Trucking, Carl Sultzbaugh and others were contacted b. At all times, no fewer than five verbal quotes were solicited and considered. c. The provider of the lowest quote was given the stone hauling assignment. 25. The Township Supervisor in charge of roads, Norman Shelly, would award the stone hauling assignments. a. Obtaining the lowest quote on a stone hauling assignment was considered to be the most important factor in awarding said assignment. b. Time was another factor in the transporting of stones and cinders. 26. Shillito Oil Company was the primary stone hauler for Carroll Township from 1990 through 1994. 27. By memorandum to the Carroll Township Supervisors dated February 16, 1996, Supervisor Norman Shelly advised that the township saved money by arranging to have the stone picked up from Hempt Brothers through separate arrangements. a. As specific road projects were begun during various times in the township, it became apparent that money could be saved if stones were stockpiled at targeted locations for project use. b. It was determined that by using other haulers to deliver the previously bid stones, a saving and delivery flexibility could be realized. c. The use of outside haulers also resulted in a more efficient scheduling and use of township manpower in that everything could be coordinated for the road crew's convenience. 28. According to Shelly's memorandum, using other haulers to pick up 412 tons of stone from Hempt, for example, would equate to a savings of $885.00 to Carroll Township. a. The cost of having Hempt Brothers deliver the stone was $19.90 per ton. b. The cost of having another hauler pick up the stone was $17.75 per ton. 29. According to Shelly, whenever Shillito Oil Company was awarded a quote, it was because they offered the lowest price. a. Shelly stated that Lavertue had an advantage over other haulers in that he owns a 22 to 24 ton truck and charges the township $45.00 per load while Larry Eichelberger Trucking charges an hourly rate of $42.00 and has only an 18 ton truck. Lavertue, 95- 047 -C2 Page 10 30. Shelly believed that because the stones were bid as either delivered or picked up at the plant, this use of other haulers should not violate any bid restrictions. 31. Carroll Township vendor records reflect that the following payments were made from the Township General Fund account to the Shilllto Oil Company for stone hauling services during the time period of August 1992 to October 1994. Check No. Date Amt. of Check Invoice 2670 10/07/92 $ 794.88 08/30/92 09/30/92 3002 05/13/93 $ 2,096.93 03/31/93 03/31/93 3040 06/03/93 $ 1,660.64 04/30/93 04/30/93 05/24/93 3187 09/08/93 $ 1,975.68 08/31/93 3540 3645 04/06/94 06/22/94 3739 08/03/94 3792 09/07/94 3847 10/06/94 $ 1,918.01 $ 330.13 $ 1,376.00 $ 2,042.39 $ 231.00 08/31/93 08/31/93 08/31/93 08/31/93 08/31/93 08/31/93 04/01/94 05/31/94 05/31/94 13696 13698 13701 13703 13704 13708 Invoice Description Hauling Stone Hauling Stone Hauling Stone 04/08/93 Hauling Stone 04/01/93 Hauling Stone Hauling Stone Hauling Stone 13468 - Hauling Stone 13466 - Hauling Stone 13461 - Hauling Stone 13469 - Hauling Stone 13479 - Hauling Stone 13489 - Hauling Stone 13488 - Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Amount Of Invoice $405.00 $300.00 $400.00 $250.00 $250.00 $150.00 $130.00 $82.50 $ 440.00 $160.00 $400.00 $160.00 $85.00 $255.00 $1,261.50 $174.00 $129.00 $516.00 $430.00 $430.00 $ 344.00 $430.00 $387.00 $215.00 09/30/94 13709 - Hauling Stone Total $ 7.784.00 32. Minutes of the Carroll Township Supervisor Meetings indicate that votes approving the issuance of General Fund Account checks to Shillito Oil Company, relating to invoices for stone hauling, were made as a group of bills presented to the board for payment on the following dates: Lavertue, 95- 047 -C2 Page 11 1587 Date Of Meeting 10/06/92 05/04/93 06/01/93 09/07/93 04/05/94 06/21/94 08/02/94 09/06/94 10/04/94 Check No. Date 1568 07/08/93 1573 08/03/93 Check No. 2670 3002 3040 3187 3540 3645 3739 3792 3847 33. Carroll Township vendor records reflect that the following payments were made from the Township State Fund Account to the Shillito Oil Company for stone hauling services during the time period of June 1993 to November 1993. Amt. of Check* $ 401.35 $ 1,279.70 10/06/93 $ 1,485.00 Vote Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Invoice 13388 13434 13435 13437 13441 13442 13444 13455 13458 13552 09/30/93 09/30/93 09/30/93 09/30/93 09/30/93 1599 11/08/93 $ 212.50 13578 Action by Lavertue Made motion, voted Made motion, voted Made motion, voted Voted Made motion, voted Made motion, voted Made motion, voted Voted Made motion, voted Description of Invoice Amount Of Invoice Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone Hauling Stone 2A Stone Hauling 13523 - Hauling Stone 8832 - $280,00 Hauling Cinder 13538- $212.50 Hauling Stone 13513 - $255.00 Hauling Stone 13512 - $340.00 Hauling Stone Hauling Stone $212.50 Total $3.195.00 $ 240.00 $ 85.00 $127.50 $255.00 $127.50 $120.00 $212.50 $160.00 $170.00 $270.00 $127.50 * Checks where the amount shown is greater than that listed in the invoice, also included payment to Shillito for other services provided by the company. 34. Minutes of the Carroll Township Supervisor Meetings indicate that votes approving the issuance of State Fund Account Checks to Shillito Oil Company, relating to invoices for stone hauling, were made as a group of bills presented to the board for payment on the following dates: Lavertue, 95- 047 -C2 Page 12 Date of Meeting 07/06/93 08/03/93 10/05/93 11/04/93 1992 1993 1994 TOTAL Check No. 1568 1573 1587 1599 Vote 35. Shillito Oil Company received the following amounts on a yearly basis from Carroll Township for stone hauling services: $ 705.00 $ 5,957.50 $ 4.316.50 $ 10,979.00 Unanimous Unanimous Unanimous Unanimous Action by Lavertue Seconded motion, voted Voted Made motion, voted Seconded motion, voted 36. In regard to the stone hauling services provided by Shillito Oil Company, Lavertue was unable to provide an estimate of his profit, emphasizing that his profit would be minimal at best. a. Lavertue's charge for stone hauling services in recent years was between $35.00 to $45.00 per load. b. Lavertue stated that he charged per load as he thought that would more favorable to the township, as other haulers charged Carroll Township by the hour, thus any delays in.the hauling process would be at Shillito's expense rather than at the township's expense. c. Lavertue would have to pay the costs of operating the truck, insurance costs, workers compensation costs, and the driver's rate of $10.00 per hour. 37. Larry Eichelberger Trucking was a competitor of the Shillito Oil Company for the stone hauling assignments. a. The only entity that provided more stone hauling services for Carroll Township than Larry Eichelberger Trucking was the Shillito Oil Company. 38. Larry Eichelberger acknowledged that he provided quotes relating to Carroll Township's hauling requirements. a. Eichelberger stated, when interviewed, that Shillito Oil Company submitted lower quotes. b. Eichelberger stated that his business could not make money if he quoted lower than Shillito Oil Company. Lavertue, 95- 047 -C2 Page 13 11I. DISCUSSION: At all times relevant to this matter, the Respondent, David Lavertue, hereinafter Lavertue, has been a public official subject to the provisions of the Public Official and Employee Ethics Law ( "Ethics Law "), Act 9 of 1989, Pamphlet Law 26, 65 P.S. §401, The issues before us are whether Lavertue as a Carroll Township Supervisor violated Section 3(a), the conflict provision, or Section 3(f), the contracting provision, of Act 9 of 1989 regarding the allegations that Lavertue: participated in Township actions as to the purchase of fuel oil and stone hauling services from a business with which he was associated; used confidential information to obtain a contract with the Township; and contracted for fuel oil and stone hauling services in excess of $500 without an open and public process. Section 3(a) of Act 9 of 1989 prohibits a public official /public employee from engaging 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 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. Section 3(f) of the Ethics Law imposes certain restrictions as to contracting. Section 3(f) of Act 9 of 1989 provides: 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 Lavertue, 95- 047 -C2 Page 14 facts. 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. §403(f). Section 3(f) of Act 9 of 1989 specifically provides in part that no public official /public 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 /public employee is associated unless the contract is awarded through an open and public process including prior public notice and subsequent public disclosure. Having noted the issues and applicable law, we shall now summarize the salient Lavertue has served as a Carroll Township Supervisor since January, 1988. In a private capacity, Lavertue is the owner of the Shillito Oil Company (Shillito). Although Lavertue became the owner of ,Shillito in 1990, the company has been providing heating fuel to the Township on a continuing basis since May, 1987 which was at a point in time before Lavertue became a Supervisor. There was never any written agreement between the Township and Shillito for the delivery of heating fuel. In January, 1994, one of the other Supervisors raised concerns about the failure of the Township to solicit bids for heating fuel. At a January 3, 1994 Township meeting, action was taken to have the Secretary/Treasurer call three fuel oil dealers to get price information and purchase at the lowest cost. After the Township Secretary/Treasurer obtained two quotes from heating fuel suppliers, she received a telephone inquiry from Lavertue as to the amounts of those two quotes. Since Lavertue was a Township Supervisor, the Secretary /Treasurer revealed the information to him. Such information was not obtainable from reviewing public documents or from making inquiry through other sources. Thereafter, Lavertue submitted a price quote on behalf of Shillito which was lower than the other two submitted quotes which he had already obtained from the Secretary /Treasurer. After the fuel oil was delivered and an invoice sent to the Township, Lavertue voted to approve the payment of the invoice at a February 1, 1995 meeting of the Township Board of Supervisors. The complete list of invoices for heating fuel delivered by Shillito to Carroll Township for the period from August, 1990 through March, 1994 is detailed in Fact Finding 12. The listing of the payments of such invoices by the Township to Shillito is set forth in Fact Finding 13. Lastly, Fact Finding 14 reflects information from the Township Minutes regarding the votes taken and actions by Lavertue as to the payments to Shillito. Lavertue, 95- 047 -C2 Page 15 Although Shillito received gross receipts totalling $10,343.20 for the sale of heating fuel to Carroll Township for the years 1990 -1994 , it appears that the actual profit amounted to $1,069.75. (Fact Findings 17 -19). In addition to heating fuel, Carroll Township routinely needed crushed stone for various road projects. The Township sought separate bids for stone supply and hauling because it was determined that it would be cheaper for the Township. Usually five verbal quotes were solicited for stone hauling services with the contract given to the lowest bid. The award of the stone hauling assignments was made by one of the other Township Supervisors. Shillito was the primary stone hauler for the Township from 1990 through 1994 because it was the low bidder. The record reflects that Lavertue had an advantage over other haulers in that he owned a 22 -24 ton truck with a charge of $45 per Toad compared to another trucking company which had an 18 ton truck and charged an hourly rate of $42. The invoices from Shillito to the Township for stone hauling are set forth in Fact Finding 31. The details as to the specific payments for such services and actions by Lavertue are detailed in Fact Finding 32. Similarly, Fact Findings 33 and 34 also reflect stone hauling invoices as well as the action taken by Lavertue for the payments. Parenthetically, the foregoing split in the invoices and payments is delineated because the first group reflects payments from the Township General Fund Account whereas the second group reflects payments from the Township State Fund Account. Finally, although the above information reflects the gross receipts received by Shillito for the stone hauling services rendered in the years 1992 through 1994, there is no discernable way within the confines of the, record to make a determination as to net profit by Lavertue. Having summarized the above relevant facts, we must now determine whether the actions of Lavertue violated Section 3(a) or 3(f) of Act 9 of 1989. As to the sale of the heating fuel to the Township in 1994, we find a violation by Lavertue of Section 3(a) of Act 9 of 1989 as to his use of confidential information. Lavertue questioned the Secretary/Treasurer to obtain the competitors' quotes so that he was able to determine what bid he should submit to insure that he would be guaranteed the heating fuel sale to the Township. Through such action, Lavertue received a private pecuniary benefit consisting of the financial gain from the sale of heating fuel to the Township. Lastly, that private pecuniary benefit enured to Lavertue or Shillito which is a business with which Lavertue is associated. The term "business with which associated" is defined under Act 9 of 1989 as follows: Section 2. Definitions "Business with which he is associated." Any business in which the person or a member of the person's immediate family is a director, officer, owner, employee or has a financial interest. 65 P.S. §402. Since Lavertue is the owner of Shillito, it is a business with which he is associated. Lavertue, 95- 047 -C2 Page 16 We find another violation of Section 3(a) by Lavertue as to supplying the Township with heating fuel in 1994. Lavertue used the authority of office when he voted to pay Township funds to Shillito. See, Juliante, Order 809. That use of authority of office resulted in a private pecuniary benefit consisting of the financial gain received by Shillito, Lavertue's business. Turning to the supply of heating fuel by Shillito to the Township for all years in question, we find 17 technical violations of Section 3(a) of Act 9 of 1989 regarding Lavertue's actions in the unanimous votes to approve payments to Shillito. The voting to approve the payments was a use of authority of office. The use of authority of office resulted in a private pecuniary benefit consisting of the financial gain as to such sales to the Township. Said payments were received by Shillito. Continuing with the matter of heating fuel sales to the Township, we also find five violations of Section 3(f) of Act 9 of 1989. There were five instances in which the contracts between Shillito and the Township, which were not awarded through an open and public process, exceeded $500. The five specific sales occurred on the following dates: December 31, 1990, January 31, 1991, February 29, 1992, February 28, 1993, and March 31, 1993. We therefore find five violations of Section 3(f) as to the sales of heating fuel to the Township by Shillito on the above five referenced dates. Leniq, Order 989. Although Shillito also provided stone hauling services to the Township, we find no violations of Section 3(f) of Act 9 of 1989 as to such contracts. The record reflects that those contracts for services were awarded through an open and public process. Since the requirements of Section 3(f) of Act 9 of 1989 were satisfied, we find no violation as to that aspect of the allegations. We do find technical violations as to Section 3(a) of Act 9 of 1989 regarding the stone hauling services by Shillito. Lavertue participated in the unanimous votes to pay for the stone hauling services which was a use of authority of office. That use of authority of office resulted in the private pecuniary benefit consisting of the financial gain to Shillito. Lastly, Shillito is a business with which Lavertue is associated. Accordingly, 13 technical violations of Section 3(a) of Act 9 of 1989 occurred as to Lavertue's participation in Board actions to pay for such stone hauling services by Shillito. Turning to the matter of restitution, Section 7(13) of Act 9 of 1989, 65 P.S. §407(13), specifically empowers this Commission to impose restitution in those instances where a public official /employee has obtained a financial gain in violation of the Ethics Law. Regarding the sales of heating fuel to the Township, the financial gain which Lavertue received amounted to approximately $1,070. (Fact Finding 19). We will impose restitution as to that amount. However, as to the stone hauling services, we will not impose restitution because we cannot quantify the amount of financial gain received from such activity. See, Perino, Order 980. Therefore, Lavertue is directed to pay restitution of $1,070 in a timely manner through this Commission to Carroll Township. Compliance with the foregoing will result in the closing of this case with no further action by the Commission. Non - compliance will result in the institution of an order enforcement action. Lastly, we note that the parties have filed a consent agreement which sets forth a proposed resolution of the allegations. We believe that the consent agreement is the Lavertue, 95- 047 -C2 Page 17 proper disposition for this case based upon our review as reflected in the above analysis and the totality of the facts and circumstances. IV. CONCLUSIONS OF LAW: 1. Lavertue, as a Carroll Township Supervisor, is a public official subject to Act 9 of 1989. 2. Lavertue violated Section 3(a) of Act 9 of 1989 when he obtained and used confidential information to discover the bids submitted by vendors seeking to sell heating fuel to the township and subsequently submitted a bid lower than the other vendors in order to secure the township's business for Shillito Oil Co., a business with which he was associated. 3. Lavertue violated Section 3(a) of Act 9 of 1989 when he voted to pay township funds to Shillito Oil Co., a business with which he was associated, for the sale of the heating fuel to the township in 1994. 4. Technical violations of Section 3(a) of the Ethics Law resulted from 17 actions by Lavertue in voting to approve payments to Shillito Oil Co., a business with which he was associated, for sales of heating fuel to the township. 5. Violations of Section 3(f) of Act 9 of 1989 by Lavertue occurred as to five sales of heating fuel by Shillito Oil Co. to the township which were in excess of $500 and not awarded through an open and public process. 6. Lavertue did not violate Section 3(f) of Act 9 of 1989 as to Shillito Oil Co. providing stone hauling services to the township in that such services were contracted through an open and public process. 7. Technical violations of Section 3(a) occurred as to 13 instances where Lavertue participated in township votes to pay for the stone hauling services rendered by Shillito Oil Co. 8. The private pecuniary benefit received by Lavertue amounts to $1,070. In Re: David Lavertue ORDER NO. 1002 File Docket: 95- 047 -C2 Date Decided: 5/30/96 Date Mailed: 6/12/96 1. Lavertue, as a Carroll Township Supervisor, violated Section 3(a) of Act 9 of 1989 when he obtained and used confidential information to discover the bids submitted by vendors seeking to sell heating fuel to the township and subsequently submitted a bid lower than the other vendors in order to secure the township's business for Shillito Oil Co., a business with which he was associated. 2. Lavertue violated Section 3(a) of Act 9 of 1989 when he voted to pay township funds to Shillito Oil Co., a business with which he was associated, for the sale of the heating fuel to the township in 1994. 3. Technical violations of Section 3(a) of the Ethics Law resulted from 17 actions by Lavertue in voting to approve payments to Shillito Oil Co., a business with which he was associated, for sales of heating fuel to the township. 4. Violations of Section 3(f) of Act 9 of 1989 by Lavertue occurred as to five sales of heating fuel by Shillito Oil Co. to the township which were in excess of $500 and not awarded through an open and public process. 5. Lavertue did not violate Section 3(f) of Act 9 of 1989 as to Shillito Oil Co. providing stone hauling services to the township in that such services were contracted through an open and public process. 6. Technical violations of Section 3(a) occurred as to 13 instances where Lavertue participated in township votes to pay for the stone hauling services rendered by Shillito Oil Co. 7. Lavertue is directed to make restitution in a timely manner through this Commission to Carroll Township in the amount of $ 1,070 which represents the profit realized by Lavertue in relation to the sale of heating fuel to the township. 8. (A) Compliance with paragraph 7 will result in the closing of this case with no further action by the Commission. (B) Non - compliance with paragraph 7 will result in the initiation of an order enforcement action. BY THE COMMISSION, 4 4w4u6 euse DANEEN E. REESE, CHAIR