HomeMy WebLinkAbout1029 AIn Re: [Mr. A]
STATE ETHICS COMMISSION
308 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
File Dockets: ID# 95- 075 -C2
LD# 96- 002 -WUA (A &B)
Date Decided: 11/4/96
Date Mailed: 11/13/96
Before: Daneen E. Reese, Chair
Austin M. Lee, Vice Chair
Roy W. Wilt
Allan M. Kluger
Boyd E. Wolff
The Investigative Division of the State Ethics Commission conducted an
investigation regarding a possible wrongful use of act under the Ethics Law, Act 9 of
1989, P.L. 26, 65 P.S. §401 seq., by the above -named "Complainant." Written
notice of the specific allegation(s) was served at the commencement of the
investigation. Upon completion of the investigation, the Investigative Division issued
and served a Findings Report, which constituted the Investigation Division's Complaint
against the "Complainant." An Answer was filed and a hearing was waived. The
record is complete. This is the determination of the Commission.
The above -named "Complainant," who filed the original Complaint with the
Commission, or the "Subject," the person against whom the Complaint was filed, may
appeal this determination to the Commission. Any such appeal must be received at
the Commission within thirty days of the date of mailing of this determination. A
Complainant or Subject who files an appeal shall be directed and required to show
cause why the Commission's determination should not become final. 51 Pa.Code
§25.4.
The files in this case will remain confidential during the above appeal period 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.
If the final determination of the Commission is that the Complainant has
wrongfully used the Act, then pursuant to Section 10.1(c) of Act 9 of 1989, 65 P.S.
§410.1(c), the Commission shall provide the name and address of the Complainant to
the Subject, together with a copy of the final determination of the Commission.
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I. ALLEGATION:
That [Complainant] violated the following provisions of the State Ethics Act (Act
9 of 1989, 65 P.S. §401 et seq.) when he filed a complaint in a grossly negligent
manner without basis in law or fact alleging that [Mr. B], a member of the [C School
Board], violated provisions of the Ethics Act.
Section 10.1. Wrongful use of act
(a) A person who signs a complaint alleging a
violation of this act against another is subject to liability for
wrongful use of this act if:
(1) the complaint was frivolous, as
defined by this act, or without probable cause
and made primarily for a purpose other than
that of reporting a violation of this act; or
(2) he publicly disclosed or caused to
be disclosed that a complaint against a person
had been filed with the commission. 65 P.S.
§10.1(a).
II. FINDINGS:
A. Pleadings
1. The Investigative Division of the State Ethics Commission received information .
alleging that [Complainant] violated provisions of the State Ethics Act (Act 9 of
1989).
2. Upon review of the information by the Director of Investigations a
recommendation was made to the Executive Director to commence an own -
motion preliminary inquiry.
3. At the direction of the Executive Director, the Investigative Division initiated a
preliminary inquiry on December 5, 1995.
4. The preliminary inquiry was completed within sixty days.
5. On February 5, 1996, a letter was forwarded to [Complainant], by the Executive
Director of the State Ethics Commission, informing him that a complaint against
him was received by the Investigative Division and that a full investigation was
being commenced.
a. Said letter was forwarded by certified mail, No. P 281 100 760.
b. The domestic return receipt bore the signature of [Mr. D] with a delivery
date of February 12, 1996.
6. The full investigation was commenced at the direction of the Executive Director
of the State Ethics Commission.
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7. The Investigative Complaint was mailed to the Respondent on July 25, 1996.
8. [Complainant] is a private citizen and [E] of the [F].
9. [F] is a concerned citizens group comprised of taxpayers from the [C School
District], [G County].
a. [F] is an issue oriented group with upwards of several hundred members.
b. [F] organized as a result of district tax increases.
10. On August 23, 1995, a notarized letter was received by the State Ethics
Commission from [Complainant], [E] of [F].
a. [Complainant] did not use a standard State Ethics Commission Complaint
Form (SEC -3 Rev. 5/95).
b. The standard complaint form outlines provisions for wrongful use of act.
c. The [notarized letter] was on [F] letterhead.
d. The [notarized letter] was signed by [Complainant], [E].
11. The backside of a standard SEC complaint form includes a reprint of Section 10
(a) and (b) of the Ethics Act regarding a wrongful use of the act.
a. A person who signs a complaint alleging a violation of this act against
another is subject to liability for wrongful use of this act if:
(1) The complaint was frivolous *, as defined by this act, or without
probable cause and made primarily for a purpose other than that
of reporting a violation of this act; or
(2) He publicly disclosed or caused to be disclosed that a complaint
against a person had been filed with the commission.
b. A person who signs a complaint alleging a violation of this act has
probable cause for doing so if he reasonably believes in the existence of
the facts upon which the claim is based and either:
(1) reasonably believes that under those facts the complaint may be
valid under this act; or
(2) believes to this effect in reliance upon the advice of counsel,
sought in good faith and given after full disclosure of all relevant
facts within his knowledge and information.
* "Frivolous Complaint." A complaint filed in a grossly negligent manner
without basis in law or fact.
12. Attached to the letter of complainant were four items identified as:
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a. Minutes of June 28, 1995, meeting of the Board of Directors of the [C
School District].
b. Tabulation of bids on purchase of computer hardware and software.
c. Letter dated June 28, 1995, from [Mr. HI, [I] Building Inspector to [Mr.
J], [C School District] Technology Coordinator.
d. Letter dated July 6, 1995, from [Mr. K] to [Mr. L], [C School District]
Superintendent.
13. [Complainant] filed the complaint on behalf of [F], as its [E], based on [F's]
belief that [Mr. B] had a business relationship with [M], the vendor awarded a
bid by the board to supply the [C School District] with computer equipment.
a. [Complainant] relied on information [F] received at public board meetings
and from citizens in attendance at said meetings to author the letter.
b. [Complainant's] complaint alleged that it was [F's] belief that "a personal
relationship exists between [Mr. N] and a [C School District] board
member, and Board Vice President [Mr. B], and that [Mr. B] may indeed
hold an equity interest in [M]."
c. [F] believed that [Mr. B's] actions as a board member conveyed the
impression that he was pushing hard for [M] to be awarded the district's
technology contract.
d. No other information substantiating [F's] belief was provided with the
complaint.
14. [F] members were present for Board meetings held on March 28, 1995, May
23, 1995, and June 27, 1995, when action occurred on technology bids.
a. [F] members were present at the Board's March 28, 1995, meeting,
when [Mr. B] indicated that the district could save money by going with
a lesser known computer name.
15. [Mr. B] was confronted by members of [F] and representatives from the [0] prior
to action on awarding the Technology Contract to [M] during the Board's June
27, 1995, meeting.
a. [Mr. B] was accused of having a [sic] business relations with [M] and
was told by the audience that he should abstain from participating in the
vote.
b. Citizens in the crowd questioned [Mr. B's] involvement with [M].
16. Board member [Mr. P], responded to the citizen's accusations on behalf of [Mr.
BI
a. [Mr. P] informed the audience that [Mr. B] purchased a computer system
from [M].
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b. [Mr. P] requested that anyone who had information indicating [Mr. B] had
any financial interest in [M] to share it.
c. No information was offered by anyone in the audience.
17. By way of letter, dated August 25, 1995, from the State Ethics Commission,
to [F] attn: [Complainant], receipt of [F's] complaint was acknowledged.
a. It was noted in said letter that the allegations were being reviewed and
that he would be notified of subsequent actions.
b. The letter further noted that Section 8(k) of the Ethics Act provides that
"all Commission proceedings and records relating to an investigation shall
be confidential."
c. Additionally, Section 9(e) of Act 9 of 1989, the Ethics Act, which
outlines penalties for violating confidentiality and for false swearing, was
reprinted and enclosed with the letter.
18. Based on information contained in the letter of complainant and attachments
sent by [Complainant], the Executive Director of the State Ethics Commission
authorized a preliminary inquiry regarding [Mr. B] on August 24, 1995.
a. The complaint was opened at Case No. 95- 057 -C2.
19. A preliminary inquiry conducted by the Investigative Division of the State Ethics
Commission confirmed the following:
a. [M] was incorporated on November 29, 1990, by [Mr. N], sole
incorporator.
b. [Mr. B] had no financial interest in [M].
c. [Mr. B] made purchases of computer hardware and /or services on seven
(7) occasions between March 1992, and October 31, 1995, from [M].
d. A Technology Committee appointed by the school board developed bid
specifications for the computer equipment.
e. The [C School District] Technology contract was bid on three separate
times in 1995.
1. Bids were publicly advertised.
f. [Mr. B] participated in a unanimous board action on March 28, 1995, to
reject all bids because of the high costs.
g-
On March 28, 1995, [Mr. B] advised the board that he had purchased a
DEC equivalent system from [M].
1. [Mr. B] advised the board to look into what [M] had to offer.
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h. (C School District] Technology Coordinator, [Mr. J], recommended that
the board accept [M's] bid on both the second and third bid solicitation.
i. On June 27, 1995, the [C School District] Board voted to approve [Mr.
J's] recommendations by a 6 -2 -1 margin with [Mr. B] voting with the
majority.
20. Following a preliminary inquiry conducted by the Investigative Division of the
State Ethics Commission, [Mr. B] was notified by letter dated October 30,
1995, that the Commission determined that there was no basis to commence
a full investigation because there was insufficient evidence to support a finding
of probable cause that the State Ethics Act had been violated.
21. By way of fax . transmission dated July 5, 1996, to the State Ethics
Commission, [Complainant] requested his father [Mr. D] and [Mr. Q] be
interviewed regarding the complaint filed against [Mr. B].
a. [Complainant's] fax transmission included the following statement:
"The only other people who knew of the original complaint were [Mr. D]
(my father) and [Mr. Q], who both helped compose the letter. Both
gentlemen attended the school board meeting where a citizen asked [Mr.
B] directly if he had any business involvement with [Mb It was clear to
me and to these two gentleman that [Mr. B] never replied to the citizen's
question. [Mr. P] and [Mrs. R] responded to the citizen's question, but
[Mr. B] never responded. This single event raised the question in our
minds and gave us reason to believe that [Mr. B] may in fact have a
financial interest with the involved company."
22. [Complainant's] father, [Mr. D], was involved with the complaint to the extent
that he reviewed it prior to its submission to the State Ethics Commission.
a. [Mr. D] stated that [F] was only seeking help from the State Ethics
Commission in determining whether any of (Mr. B's] actions constituted
a conflict of interest.
b. [Mr. D] asserts that the group did not have any malicious intent in filing
the complaint against (Mr. B].
23. (Mr. Q] served in a secretarial capacity for [F].
a. [Mr. Q's] only role with the complaint was to type it based on
information furnished him by [Complainant].
b. [Mr. Q] did not know the specific source of [Complainant's] information.
24. By way of letter, dated December 4, 1995, to the State Ethics Commission
from [Mr. B], [Mr. B] requested the Commission determine that SEC Case #95-
057-C2, against him was "frivolous and had no basis in law or in fact."
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a. [Mr. B] felt that "the complaint(s) used the act and the regulatory process
in an attempt to embarrass me [him] and cause my [his] professional
reputation to be affected in the community."
B. Documents
25. Exhibit 2 to [Complainant's] Response to Investigative Complaint is a letter from
[Complainant] to [Mr. Q] dated 8/8/95.
a. The letter states:
[Mr. Q],
I called Pa. State Ethics Commission today! Their
numbers are 1(800)932 -0936 or (717)783 -1610. I spoke
with a Christine at the 800 #. She told me that to file a
complaint we should include as much evidence or
information that that [sic] supports the complaint and that
the documentation should be notarized. The letter of
complaint and documentation should be mailed to: Mr.
Rob Caruso - Director of Investigations - 309 Finance
Building - PO Box 11470 - Harrisburg, PA 17108 -1470.
Include in the letter both my home phone and business
phone numbers. [phone numbers].
The letter that I hope you have time to compose for
me should first state that it is our fear that a current board
member - [Mr. BI has a conflict of interest by voting to
award the e [sic] computer bid to [M] ([Mr. NJ - Owner)
when in May and June he voted on motions to accept their
bids when having a long standing business and possible
personal relationship with [Mr. N]. [M] currently provides
and maintains computer services to [Mr. B's] [S].
Also mention that another vote could take place at
this month's meeting where more than likely he will vote
again to award more business to his associate. The bid
specs of this most recent bid have been tailored, down to
the "chip sets" of the hardware so that only his associate
([Mr. N]) can be the only responsible bidder. This could be
a violation of ethics and an abuse of power. We want any
board member to abstain on any votes that involve public
funds when they have an existing relationship with agencies
that will be receiving those public funds.
We need his office to act quickly to stop it from
happening again.
Documentation that we need to get:
1. Minutes of May an [sic] June School Board
meeting
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bids.
2. Copies of Technology related proposals and
3. Any Statements from sympathetic board
members that could serve as proof of this complaint. [Ms.
T], [Mr. U], [Ms. V] and [Ms. WI.
I'll start to gather some of the info mentioned above.
Perhaps [Mr. K] has some of it already. Surely [Mr. U] and
[Ms. T] do.
Thanks and as always I appreciate your donating your time
and your communications expertise.
[Complainant]
26. Exhibit 3 to the Respondent's Answer is the notarized letter dated August 16,
1995, from [Complainant] as [E] of the [F] to Mr. Rob Caruso, Director of
Investigations of the State Ethics Commission, which is referenced in Finding
10.
a. The letter is on the [F] letterhead.
b. The letter states:
Dear Mr. Caruso:
To introduce ourselves, we are a group of concerned
citizens residing in the boroughs of [I], [X] and [Y] in [G
County]. These three boroughs also comprise the [C School
District], which is the focus of this letter. We fear that a
member of the Board of Directors of that district may be
involved in a conflict of interest and an abuse of power.
The [C School District] recently awarded a contract
for computer hardware and software to [M], which is at
least partially owned or controlled by a [Mr. N]. We have
reason to believe that a personal relationship exists between
[Mr N] and a [C School District] board member (and board
vice president), [Mr. BI, and that [Mr. B] may indeed hold an
equity interest in [M]. We do know that [M] currently
provides and maintains computer services to [Mr. B's] [S],
located at [address], Borough of [I].
It is a matter of record that the contract for the
purchase of the computer hardware and software was bid
three times, the first two sets of bids having been rejected
because of various discrepancies in the specifications. A
tabulation of the third set of bids is enclosed, together with
a copy of the minutes of the board's June 27 meeting, on
which we have highlighted items relevant to the award of
this contract.
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At [Mr. B's] insistence, [M's] bid was ruled the
"lowest responsible bid" and the contract award made on
that basis. This, in spite of the fact that, contrary to the
school district's specification, the equipment being supplied
by [M] does not carry the required approval. by the Federal
Communications Commission (FCC). While we understand
that it is not illegal to purchase computers that do not have
the FCC approval, it is possible that the FCC could later
come in and shut down any equipment that lacks its
approval.
There is also a serious question, quickly dismissed by
[Mr. B], on the lack of testing and approval by a third party
such as Underwriters Laboratories (UL). While this does not
necessarily mean that the equipment has a shock or fire
hazard, we have documentation (copy enclosed) from the
Building Inspector of the Borough of [I] that operation
without the UL or equivalent label would be a violation of
the building code adopted by the borough. That letter has
been ignored, and the purchase of the equipment under the
contract is proceeding.
It is also our understanding that a vote could take
place at the August 22 meeting for award of yet another
contract for computer equipment where it is anticipated that
[Mr. B] will lead a campaign to make an award to [M]. Our
information is that the bid specifications for this latest
contract have been tailored, down to the "chip sets" of the
hardware, so that [M] can be the only responsible bidder.
In closing, let me State that we, as a citizen's group
of more than 1000 taxpayers in the [C School District], are
deeply concerned over this situation and strongly feel that
corrective action needs to be taken against this obvious
violation of Ethics and abuse of power.
Should you have any questions or desire further
information, you may call me at home, phone [phone
number] evenings or weekends, or at my business location
in [Z], phone [phone number], weekdays 8 AM to 5 PM.
Sincerely,
Sworn To Before Me This 22nd of
August 1995
[Complainant] [Notary Sea /J
s /[Notary]
Notary
Enclosures:
1. Minutes of June 28, 1995 meeting of the Board of
Directors of the [C School District]
2. Tabulation of bids on purchase of computer hardware
and software
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3. Letter dated June 28, 1995 from [Mr. H], [I] Building
Inspector to [Mr. J], [C School District] Technology
Coordinator
4. Letter dated July 6, 1995 from [Mr. K] to [Mr. L], [C
School District] Superintendent
III. DISCUSSION:
[Complainant] is a private citizen who resides within the [C School District] in
[G County], Pennsylvania. As such, he is subject to the wrongful use of act provisions
of Act 9 of 1989.
Section 10.1 of Act 9 of 1989, the Wrongful Use of Act provision, provides in
pertinent part that a Wrongful Use of Act occurs if a complaint is frivolous, that is,
filed in a grossly negligent manner without basis in law or fact.
Factually, on August 23, 1995, the notarized letter from [Complainant] which
is set forth in full at Finding 26 was received by the State Ethics Commission, together
with certain enclosures enumerated at Finding 12.
[Complainant] is [E] of the [F], a concerned citizens group comprised of
taxpayers from the [C School District]. [Complainant] submitted the August 16, 1995
notarized letter to this Commission based upon [F's] belief that [C School District]
Board Member and Vice President [Mr. B] had a business relationship with, and
possibly an equity interest in, [M] -- a vendor that was awarded a bid by the Board to
supply the School District with computer equipment. In filing the notarized letter,
there was reliance on information received at public Board meetings and from citizens
in attendance at said meetings. [F] believed that [Mr. B's] actions as a Board member
conveyed the impression that he was pushing hard for [M] to be awarded the District's
technology contract. Pertinent incidents that occurred at various Board meetings are
set forth in Findings 14 through 16.
Based upon the August 16, 1995 letter and attachments, the Executive Director
of this Commission authorized a preliminary inquiry regarding [Mr. B] on August 24,
1995. The preliminary inquiry revealed, inter that although [Mr. B] had purchased
computer hardware and /or services from [M], he had no financial interest in it.
Thereafter, the case was closed for lack of probable cause that the State Ethics Act
had been violated.
[Mr. B] has requested that this Commission determine that the case against him
was "frivolous and had no basis in law or fact."
We initially address a legal issue that has been raised by [Complainant] in
Paragraph 10 of his Response to the Investigative Complaint. By denying that he
charged [Mr. B] with a violation of the Ethics Act, and by asserting that his August 16,
1995 letter (See Finding 26) "raised several issues but did not allege a violation of the
State Ethics Act; . ." (Respon to I nvestigative Com at paragraph 10),
[Complainant] has essentially raised the issue of whether the said letter to the
Commission was a "complaint."
The Ethics Law and the Regulations of this Commission set forth the criteria for
the contents of a complaint. Pursuant to Section 8(a) of the Ethics Law, a complaint
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is signed under penalty of perjury by any person. 65 P.S. §408(a). Pursuant to
Commission Regulations, a complaint alleging a violation of the Ethics Act is required
to contain the name, position or office held by the respondent (the person against
whom the complaint is made), and the basis of the complaint by delineating the facts
and circumstances of the alleged violation. The complaint must be sworn and signed
by the complainant. 51 Pa. Code §21.1(a), (b).
In comparing the above criteria to the August 16, 1995 letter received from the
Complainant (Finding 26), it is clear that the said letter constitutes a "complaint." The
August 16, 1995 letter of [Complainant] was signed by him and was sworn before a
notary. The letter contains the name and position of the person against whom the
complaint was made ([Mr. B], a Member and Vice President of the Board of [C School
District]). The letter states in detail the basis of the complaint by delineating the
specific facts and circumstances. Furthermore, despite Complainant's protestations
that he did not allege a violation of the Ethics Act, we find to the contrary based not
only upon the letter as a whole, but upon the following specific statements contained
therein:
. We fear that a member of the Board of Directors of that District may
be involved in a conflict of interest and an abuse of power.
In closing, let me State that we, as a citizen's group of more than
1000 taxpayers in the [C School District], are deeply concerned over this
situation and strongly feel that corrective action needs to be taken
against this obvious violation of Ethics and abuse of power.
[Complainant's] Letter of August 16, 1995 at 1 -2.
Given that Complainant's August 16, 1995 letter meets all of the criteria as a
signed and sworn document alleging a violation of the Ethics Law by a properly
identified respondent, we conclude that the said letter is a "complaint" as that term
is used in the Ethics Law and specifically Section 8 of the Ethics Law, 65 P.S. §408.
We parenthetically add that in reviewing [Complainant's] letter to [Mr. Q] (See Finding
25), by which [Complainant] gave specific instructions for drafting the August 16,
1995 letter based upon his conversation with a Commission staff member as to how
to file a complaint, we have no doubt that [Complainant] submitted the August 16
letter as a complaint.
We now address the allegation that the Complainant wrongfully used the Act
by filing a frivolous complaint in a grossly negligent manner without basis in law or
fact.
The term "frivolous complaint" is defined in the Ethics Law as "A complaint filed
in a grossly negligent manner without basis in law or fact." 65 P.S. §402.
In Yakin, Order No. 999, we enunciated the test for determining a wrongful use
of act on the aforesaid basis. The test is as follows:
... "A complaint filed in a grossly negligent manner without basis in law
or fact," means a complaint which is filed based upon mere suspicion or
speculation and an indisputably meritless legal theory, and which has
been filed with substantially more than ordinary carelessness,
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Id, at 14 -15.
J,d at 15.
inadvertence, laxity or indifference, and a reckless disregard for the
consequences.
We further stated:
The standard is stringent. It was meant to be stringent. In
drafting this provision, the Legislature was necessarily mindful of the
chilling effect which wrongful use of Act cases would bring to the filing
of complaints with this Commission. The Legislature clearly intended
that findings of wrongful use of Act be restricted to egregious situations.
We find that the stringent standard for wrongful use of act has not been met
in this case, and accordingly, that [Complainant's] filing of the August 16, 1995 letter
was not a wrongful use of the Ethics Act. We do not reach the question of whether
the facts set forth in the complaint letter rise above the level of mere suspicion or
speculation, because the legal theory upon which the filing was based had merit and
the complaint was not filed with "substantially more than ordinary carelessness,
inadvertence, laxity or indifference, and a reckless disregard for the consequences."
Based upon all of the above, we find that [Complainant] did not violate Section
10.1 of the Ethics Law when he filed the complaint with this Commission, dated
August 16, 1995, alleging that the subject, [Mr. B], a Member of the [C School Board],
violated provisions of the Ethics Act.
IV. CONCLUSIONS OF LAW:
1. [Complainant], as a private citizen who resides within the [C School District] in
[G County], Pennsylvania is subject to the wrongful use of act provisions of the
Public Official and Employee Ethics Law, Act 9 of 1989.
2. (Complainant] did not violate Section 10.1 of the Ethics Law when he filed the
complaint with the State Ethics Commission, dated August 16, 1995, alleging
that [Mr. B], a Member of the [C School Board], violated provisions of the Ethics
Act in that the standard for wrongful use of act has not been met in this case.
In Re: [Mr. A]
ORDER NO. 1029
File Dockets: ID# 95- 075 -C2
LD# 96- 002 -WUA (A&B)
Date Decided: 11/4/96
Date Mailed: 11/13/96
1. [Mr. A], the "Complainant," as a private citizen who resides within the [C
School District] in [G County], Pennsylvania, did not violate Section 10.1 of the
Ethics Law when he filed the complaint with the State Ethics Commission,
dated August 16, 1995, alleging that [Mr. 81, a Member of the [C School
Board], violated provisions of the Ethics Act in that the standard for wrongful
use of act has not been {net in this case.
BY THE COMMISSION,
1 Ye t 0 u E �
DANEEN E. REESE, CHAIR