HomeMy WebLinkAbout1075 SayersIn Re: Donald Sayers
STATE ETHICS COMMISSION
308 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
File Docket: 97- 032 -C2
X -ref: Order No. 1075
Date Decided: March 2, 1998
Date Mailed: March 6, 1998
Before: Daneen E. Reese, Chair
Austin M. Lee, Vice Chair
Allan M. Kluger
Rev. Joseph G. Quinn
Julius Uehlein
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 et 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 not timely filed and a hearing was deemed waived. The record is complete.
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.
Sayers, 97- 032 -C2
Page 2
I. ALLEGATION:
That Donald Sayers, a public official /public employee in his capacity as a
Councilman for South Bethlehem Borough, Clarion County, violated the provisions 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 business with which he is associated by
participating in actions and /or discussions of council to award a contract to build a
borough garage to a company he subcontracted with to build the garage; and when
he contracted with the borough for building and renovation services in excess of $500
without an open and public process; and when he participated in approval of payments
to the contractor and his business.
Section 3. Restricted Activities
(a) No public official or public employee shall
engage in conduct that constitutes a conflict of interest. 65
P.S. §403(a).
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. 65 P.S. §403(f).
Section 2. Definitions
"Conflict" or "conflict of interest." Use by a public
official or public employee of the authority of his office or
employment or any confidential information received
through his holding public office or employment for the
private pecuniary benefit of himself, a member of his
immediate family or a business with which he or a member
of his immediate family is associated. "Conflict" or
"conflict of interest" does not include an action having a de
minimis economic impact or which affects to the same
degree a class consisting of the general public or a subclass
consisting of an industry, occupation or other group which
includes the public official or public employee, a member of
Sayers, 97- 032 -C2
Page 3
II. FINDINGS:
his immediate family or a business with which he or a
member of his immediate family is associated. 65 P.S.
§402.
1. The Investigative Division of the State Ethics Commission received a signed,
sworn complaint alleging that Donald Sayers violated provisions of the State
Ethics Act (Act 9 of 1989).
2. Upon review of the complaint the Investigative Division initiated a preliminary
inquiry on May 19, 1997.
3. The preliminary inquiry was completed within sixty days.
4. On July 16, 1997, a letter was forwarded to Donald Sayers, 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 487 031 904.
b. The domestic return receipt bore the signature of Donald Sayers, with a
delivery date of July 18, 1997.
5. Periodic notice letters were forwarded to Donald Sayers in accordance with the
provisions of the Ethics Law advising him of the general status of the
investigation.
6. The Investigative Complaint was mailed to the Respondent on January 12,
1998.
7. Donald Sayers has served as a council member for South Bethlehem Borough,
Armstrong County, since January, 1994.
a. In 1994 and 1995, Sayers served as Chairperson of the Street and
Sewer Committee and also served on the Finance Committee and Police
and Fire Committee.
8. Donald Sayers is self - employed as a residential and light industrial building and
remodeling contractor.
a. Sayers operates this business, Donald Sayers Contracting, from his
residence, 108 Grant Street, New Bethlehem, PA 16242.
b. Sayers employs two full -time workers year round, and several part-time
workers, March through December.
c. The business has been in operation since 1976.
9. in 1994, South Bethlehem Borough Council entered into an agreement to sell
the building which was used to hold council meetings.
Savers, 97- 032 -C2
Page 4
a. Council planned to use the proceeds from the sale to build a new borough
garage.
b. The new property owners were tearing down the existing building on the
property and erecting a senior citizen high -rise.
c. The new property owners agreed to provide Council with space in the
new building to hold meetings.
10. Sayers drafted the specifications for the new borough garage at the request of
Council.
11.
a. The specifications were drawn to meet the requirements discussed by
Council.
b. No one else on council had construction experience.
c. Sayers was not paid for his time spent drafting the specifications.
At the council meeting of August 2, 1994, Sayers presented the specifications
for a 30' x 50' borough garage.
a. Council agreed to advertise for bids to be received until 7:00 p.m. on
September 6, 1994.
b. Present at the meeting were Charles Bell; Melvin Blake; Clair Nimes;
Glenn Kerr; Russell Hinderliter and Donald Sayers.
12. Borough council requested that Sayers provide an approximate cost estimate for
council to use as a gauge when reviewing bids submitted for the garage project.
a. Sayers' estimate was $27,494.00.
13. On September 6, 1994, bids were opened for the borough garage.
a. A bid of $45,819.00 was received from Dilcante of Pittsburgh.
b. No other bids were received.
c. No action was taken and the matter was tabled until borough Solicitor
provides a ruling on Sayers being able to bid on the project.
d. A motion was unanimously approved that if Sayers cannot bid, that bids
not be put out until spring.
e. Sayers was present at this meeting, and is not reflected as abstaining
from the vote.
14. The reason for the motion of September 6, 1994, was that Council wanted
Sayers to handle the project.
a. Sayers declined unless the solicitor advised that it was legal.
Savers, 97- 032 -C2
Page 5
15. Borough Secretary/Treasurer, Emily Harmon, contacted Solicitor H. John Drayer
on September 7, 1994, to request an opinion as to whether Don Sayers, a
Council Member, could be awarded a contract for the construction of the
borough building.
16. In an undated letter, Attorney H. John Drayer opined that members of Borough
Council cannot participate in a contract with the municipality they represent.
Drayer's letter provided as follows:
"In determining the answer to this question, I have examined a number
of provisions set forth in the Municipalities Planning Code.
Specifically, §551 of Title 53 provides that a Council Member must
disclose any interest he has in a matter and not participate in the vote on
that matter.
I have also examined the provisions in the state ethics code set forth in
Title 65, specifically §403 which indicates that public officials or public
employees should not engage in contracts with the governmental body
with which they are associated unless competitive bidding has been
followed and the public official discloses his interest and does not
participate.
Both of these provisions would seem to indicate that Don could be
awarded the contract if he did not participate in the vote. However, I
have examined 53 Pa. C.S.A. §46404, a copy of which I am enclosing.
This provision makes it clear that members of Borough Council cannot
participate in a contract with the Municipality they represent. There are
no exceptions. Therefore, it is my opinion and the opinion of this office
that the contract cannot be awarded to Mr. Sayers. Violation of this
statute is a criminal offense and Mr. Sayers could be removed from
office."
17. As a result of the Opinion provided by Solicitor Drayer, no action was taken in
1994 to award a contract for the building of a borough garage.
18. At the February 1995, Council meeting, Sayers presented new specifications
for the borough garage.
a. The new specifications were to be advertised in the local newspaper
effective 02/22/95.
b. The specifications were revised to lower the cost of the project.
19. At the April 4, 1995, meeting it was reported that no bids were received for the
borough garage and that the solicitor should be contacted.
a. No reason was stated for contacting the solicitor.
20. At the May 2, 1995, South Bethlehem Borough Council Meeting, action was
taken relating to Donald Sayers' participation in the construction of the borough
garage.
Sayers, 97- 032 -C2
Page 6
a. A motion was approved unanimously to have Solicitor Drayer prepare the
necessary paperwork so that Don Sayers could do construction work for
the borough garage.
b. Present at the meeting were Charles Bell; Melvin Blake; Clair Himes;
Glenn Kerr; Russell Hinderliter and Don Sayers.
c. No roll call vote was taken, nor were any abstentions recorded.
21. On or about May 2, 1995, council discussed whether it would be acceptable for
Barry Downs, owner of Barry's Backhoe Service, to hire Sayers as a
subcontractor on the construction of the borough garage.
a. Barry's Backhoe Service is an excavating business that does not generally
perform construction type services.
b. Barry's Backhoe Service specializes in excavation, pipeline and septic
system installation.
c. Barry's Backhoe Service does participate in building construction projects.
d. Barry's handles sub - contracting work such as footers and site
preparation.
e. Barry's Backhoe has been utilized by Don Sayers' Contracting as a
subcontractor in the past.
22. At the direction of council, Sayers contacted Downs to find out if he would be
interested in submitting a bid for the borough garage.
a. Downs asked Sayers if he would be interested in subcontracting the job.
b. Sayers helped Downs prepare the bid information relating to the
construction portion of the project.
c Downs did not contact any contractors other than Sayers for the
subcontract.
23. Council took action to readvertise for bids for the borough garage at the July
11, 1995, meeting.
a. Bids were to be submitted by 08/01/95, for opening at a council meeting
to be held on the same date.
b. Bids were advertised on July 19, 1995.
24. Barry's Backhoe Service was the only bid timely submitted in response to the
July 19, 1995, advertisement for bids for the borough garage.
a. The bid, dated 07/31/95, was in the amount of $28,000.00.
25. Donald Sayers assisted Barry's Backhoe Service in preparing the bid submitted
to South Bethlehem Borough.
Savers, 97- 032 -C2
Page 7
a. Sayers provided Barry Downs, owner of Barry's Backhoe Service with
cost estimations for all of the project except the excavating.
26. At the time Barry Downs submitted his bid to the borough he and Sayers agreed
that Sayers would act as a subcontractor on the building project.
27. Council took action at the August 1, 1995, meeting, to accept the bid from
Barry's Backhoe Service. The minutes confirm the following:
Present: Charles Bell; Melvin Blake; Clair Himes; Glenn Kerr; Russell
Hinderliter; Donald Sayers.
a. Donald Sayers was present and is not reported as abstaining from the
vote.
28. Barry's Backhoe Service's work on the garage included footer work /prepping the
floor area for concrete; digging and installing drains, bringing the site up to
grade and landscaping.
a. Donald Sayers Contracting did the construction of the building.
29. Borough Council approved payments to Barry's Backhoe Service during the
September and October, 1995, meetings as follows:
a.
"Bids were opened for the construction of the borough garage. There
was (1) bid from Barry's Backhoe Service for the amount of $28,000.
A motion was made by Dean Bell seconded by Glenn Kerr to accept bid.
Motion carried."
September 5, 1995:
"A motion was made by Russ Hinderliter, seconded by Dean Bell to pay
bills. Motion carried."
1. The bill listing contained a $21,000 bill from Barry's Backhoe.
"A motion was made by Dean Bell that the contractor of new borough
garage be paid 75 %. Russ Hinderliter second motion. Motion carried."
Donald Sayers was present and is not reported as abstaining from the
vote.
No abstention is recorded on either motion.
2. No public disclosure by Sayers of his financial interest is recorded.
b. October 3, 1995:
"A motion was made by Charles Bell, seconded by Clair Himes to pay
bills, also the remaining amount to Barry Backhoe."
Sayers, 97- 032 -C2
Page 8
Present: Charles Bell; Clair Himes; Glenn Kerr; Russell Hinderliter;
Donald Sayers.
1. The bill list recorded in the minutes included a payment to Barry's
Backhoe in the amount of $7,000.00.
2. Donald Sayers was present and is not recorded as abstaining from
approving payment of bills.
3. No public disclosure by Sayers of his financial interest is recorded.
30. South Bethlehem Borough issued two checks to Barry's Backhoe Service for the
construction of the borough garage.
a. Check #1937, dated 09/06/95, was issued in the amount of
$21,000.00.
1. Authorizing signatures on the check were Emily Harmon,
Secretary /Treasurer, and Council Member Melvin Blake.
2. The reverse side of the check was endorsed "Barry's Backhoe
Ser."
b. Check #1961, dated 10/10/95, was issued in the amount of $7,000.00.
1. Authorizing signatures on the check were Emily Harmon,
Secretary /Treasurer, and Council Member Russell Hinderliter.
2. The reverse side of the check was endorsed "Barry's Backhoe
Ser."
31. Sayers was paid $25,420.00 for the construction work he performed on the
borough garage, work he subcontracted from Barry Downs, owner of Barry's
Backhoe Service.
32. Two payments, totaling $25,420.00 were deposited into the bank account of
Donald Sayers Contractor at New Bethlehem Bank from Barry's Backhoe Service
for construction work Sayers performed on the borough garage.
a. Check #1179, dated 10/03/95, in the amount of $10,000.00, was
issued by Barry Downs. The memo portion of the check indicated "SBB
Building ". (South Bethlehem Borough).
b. Check #1 190, dated 10/20/95, in the amount of $15,420.00, issued by
Barry Downs. The memo portion of the check indicated "SBB Building ".
33. The original specifications agreed upon by council as designed by Donald Sayers
for the borough garage called for a garage to be used for the storage of the
borough vehicle and equipment.
a. No space was provided for use by council for meetings or as office
space.
Sayers, 97- 032 -C2
Page 9
b. The garage was not insulated or heated.
34. At the January 2, 1996, South Bethlehem Borough Council meeting the Board
approved work on the borough garage to make it useable for meetings.
a. A motion was unanimously approved to have borough garage rooms
finished and for Donald Sayers to oversee completion of the job.
b. Donald Sayers was present and is not recorded as abstaining from the
vote.
35. The reason for council finishing the garage was due to council having difficulty
getting the new owners of the old borough property to abide by the agreement
of giving council space for meetings. (See Finding No. 9(c)).
a. It was agreed upon by council to have Sayers do the work.
b. Sayers agreed to do the work and advised that he would not charge• the
borough for his labor, only the labor of his employees.
c. The borough paid for the materials.
36. Sayers and his employees installed partitions for an office, storage room and
restroom and finished off the area to be used for meetings.
a. The cost of the materials paid for by the borough was approximately
$3,000.00.
b. Sayers billed the borough $990.00 for the time his employees on a rate
of $18.00 per hour for fifty -five (55) hours.
37. Sayers submitted a bill to South Bethlehem Borough, dated 02/04/96, which
detailed the work performed for finishing the inside of the borough garage and
labor costs.
a. Employee labor for installation of partitions, overhead storage loft,
insulation sheetrock, paneling, ceiling tile, trim and wiring in new borough
building.
b. Labor
55 hours @ 18.00 - $990.00"
38. Sayers did not charge for his own time which he estimated at sixty -eight (68)
hours at $18.00 /hour, total $1,224.00.
a. Sayers' regular rate was 518.00 /hour.
39. On February 6, 1996, South Bethlehem Borough Council voted to approve
payment of the bills which included the $990.00 payment to Sayers for work
he performed on the inside of the borough garage.
a. Donald Sayers was present and is not recorded as abstaining from voting
to approve the bill listings.
Savers, 97- 032 -C2
Page 10
40. Check #2021, dated 02/08/96, was issued by South Bethlehem Borough to
Donald Sayers in the amount of $990.00.
a. Authorized signatures included Emily Harmon, Secretary /Treasurer, and
Council Member Melvin Blake.
41. The $990.00 payment from South Bethlehem Borough for the finishing work
Sayers performed on the inside of the borough garage was deposited into
Sayers' business account at the New Bethlehem Bank on February 9, 1996.
42. On July 19, 1996, flooding of Red Bank Creek caused extensive damage to
South Bethlehem Borough garage.
43. On August 6, 1996, South Bethlehem Borough Council met to discuss the flood
and the damage to the borough garage.
a.
Don Sayers provided a break down on the cost of repairing the damage
to the borough garage of between $4,000 to $6,000.
b. No action was taken by council to approve the repairs.
44. Donald Sayers /Donald Sayers Contracting performed the repairs to the borough
garage caused by the flood.
a. Bids were not sought by council.
b. The borough council believed it could not afford to pay an outside
contractor to effect the repairs.
45. Council members wanted Sayers to make the repairs to the borough garage
because he was a local contractor and because he had built the garage and
knew where to get matching materials.
46. Sayers agreed to repair the borough garage and provided a cost estimate in
excess of $1,000.00.
a. Sayers assigned several of his employees to work on the garage.
b. Sayers supervised the work on the borough garage.
c. The borough paid for the materials.
47. On December 3, 1996, Sayers billed the borough $1,206.00 for the repairs to
the borough garage.
a. The bill was itemized as follows:
Replace steel siding, install new garage door, replace two garage door
panels, reinsulate, resheetrock, repanel and retrim, clean and oil locks.
68 man hours at $18.00 /hour.
Savers, 97- 032 -C2
Page 11
48. South Bethlehem Borough issued check #2214 to Donald Sayers on 12/05/96,
in the amount of $1,206.00, as payment for the repairs to the borough garage.
a. The check was authorized by Secretary /Treasurer Donna Scott and
Council Member Russell Hinderliter.
49. The $1,206.00 payment from South Bethlehem Borough for the repair to the
borough garage was deposited into the account of Donald Sayers Contracting
on December 6, 1996.
50. Sayers donated his time to South Bethlehem Borough from 1994 to the present
time, on a number of different borough projects, including the following:
Hrs.
Description
5 Cutting trees and supervising bull dozing of borough lots.
43 Broad Street Sewer Replacement Project: Labor to assist laying
and cutting 8" sewer line and hooking up customer lines, cribbing
ditches, spreading gravel, barricading road, flagging traffic, etc.
6 Draw up and type specifications for borough building.
Remove overhead door and opener and walk in door from old
borough garage.
4 Remove steel door units and electric entrance from old borough
building.
3 Assist with pipe cutting and laying on Allison Street Sewer
Replacement Project.
3 Revise specifications on borough building and re -type.
68 Build in meeting room, bathroom, storage, overhead storage loft,
wiring, insulation, furnace runs, drywall, paneling, ceilings, trim,
gasolines, hang doors, etc.
5 Donation following flood of dump truck, gasoline, time to assist
borough with clean up and hauling to flood burn pit.
20 Donation of labor to repair flood damage to borough building.
21 Donation of time by Sayers and his employees to assist on
finishing borough bathroom: Drywall, drywall finishing, install fan
and light combination, plumbing, install new door.
181 Hours total
a. Sayers provided the list subsequent to his interview by the State Ethics
Commission Investigation Division.
1. Sayers was unable to provide dates for the projects identified
above.
Savers, 97- 032 -C2
Page 12
b. The donation of time by Sayers on the identified projects was verified by
members of Council.
51. It was a common practice of members of South Bethlehem Borough Council to
donate their time, expertise and equipment to help save the borough money.
a. Council members are not compensated when time or services are
donated.
52. Sayers prepared a document dated February 10, 1996, titled "Business
Donation to South Bethlehem Borough Armstrong County, Pa.", which reflected
the number of hours he estimated that he spent finishing the interior of the
borough garage.
a. Sayers had the borough secretary, Emily Harm, sign the document to
validate that he did not charge the borough for his time.
b. The donation in the amount of $1,224.00, consisted of 68 man hours @
$18.00 /hour.
53. Donald Sayers Contracting received payments totaling $37,616.00 [sic] as a
result of contracts /subcontracts with South Bethlehem Borough.
Date Amount Source Finding No.
a. 10/03/95 $10,000.00 Barry's Backhoe 31(a)
b. 10/20/95 $15,420.00 Barry's Backhoe 31(b)
c. 02/08/96 $ 990.00 South Bethlehem Boro. 41
d. 12/05/96 $ 1,206.00 South Bethlehem Boro. 49
54. Sayers provided an accounting of his costs on the subcontracting work he
performed on the borough garage, on which Barry's Backhoe Service was the
general contractor.
Payment from Barry's Backhoe Service $25,420.00
Costs:
Estimated material cost
Estimated labor (excluding Sayers)
550 hours @ $18.00 /hour
TOTAL:
DIFFERENCE:
$14,858.00
$ 9.900.00
$24,758.00
$ 662.00
III. DISCUSSION:
At all times relevant to this matter, the Respondent, Donald Sayers, hereinafter
Sayers, 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,
Savers, 97- 032 -C2
Page 13
The allegations are that Sayers violated Sections 3(a) and 3(f) of Act 9 of 1989
when he participated in actions of council to award a contract to build a borough
garage to a company he subcontracted with to build the garage; and when he
contracted with the borough for garage addition and renovation services in excess of
$500 without an open and public process; and when he participated in approval of
payments to the contractor and his business.
Pursuant to Section 3(a) of the Ethics Law quoted above, a public official /public
employee is prohibited from engaging in conduct that constitutes a conflict of interest.
The term "conflict of interest" is defined under Act 9 of 1989 as quoted above:
In addition, 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.
Initially, we must consider a procedural issue that has arisen regarding the
receipt of an Answer to the Investigative Complaint. The pleading stage in this case
began with the issuance of the Investigative Complaint on January 12, 1998. On its
face, the Investigative Complaint stated that an Answer had to be received at this
Commission within thirty (30) days of issuance and that the Respondent should take
that document immediately to an attorney. In this case, an Answer was received on
February 13, 1998 which was thirty two days after the issuance of the Investigative
Complaint.
It is clear under the Ethics Law and Regulations that a response to the
Investigative Complaint must be received within 30 days. 65 P.S. §408(e); 51
Pa.Code §21.5(k). As noted above, even the face sheet of the Investigative Complaint
states that an Answer must be received within 30 days. The Answer in this case was
received two days late.
In order for a late answer to be deemed timely filed, we apply the same standard
as is applied by the courts to untimely appeals (see, Getz v. Pennsylvania Game
Commission, 475 A.2d 1369 (Pa. Commw. Ct. 1984) applying that standard in
administrative proceedings to an untimely request for a hearing). The standard is that
to accept the untimely filing as if it were timely, there must either have been fraud or
a breakdown in the administrative process, see, West Penn Power Co. v. Goddard,
460 Pa. 551, 333 A.2d 909 (1975); Bianco v. Robinson Twp., 556 A.2d 993 (Pa.
Commw. Ct. 1989), which includes the postal process (Getz v. Pennsylvania Game
Commission, 475 A.2d 1369 (1984)), or there must have been unique and compelling
factual circumstances establishing non - negligent failure to file timely, Grimaud v. Dep't
of Env. Resources, 638 A.2d 299 (Pa. Commw. Ct. 1994); Bass v. Com., 485 Pa.
256, 401 A.2d 1133 (1979).
None of the conditions for allowing the filing of a late Answer is present in this
case. In fact, there has not even been any allegation of fraud, any breakdown in the
administrative process or the mail delivery system, or any unique and compelling
factual circumstances that would establish a non - negligent failure to timely file.
Savers, 97- 032 -C2
Page 14
Parenthetically, we note that our Regulations allow for the filing of an application for
an extension to file an Answer. 51 Pa.Code §21.5(k). No such request was made in
this case.
Where there is a showing of fraud or a breakdown in the administrative process,
the time period may be extended. Friends Hospital v. Department of Public Welfare,
551 A.2d 640 (Pa. Commw. Ct. 1988); Polakovic v. Unemployment Compensation
Board of Review, 531 A.2d 852 (Pa. Commw. Ct. 1987). There is no evidence in this
case of any such fraud or breakdown in the administrative process.
Since it is clear that this Answer is untimely, we must decide this case based
upon the Findings in the Investigative Complaint which are deemed admitted. See, 65
P.S. §408(e); 51 Pa. Code §21.5(k).
facts.
Having resolved the procedural issue, we shall now summarize the relevant
Sayers has served on Borough Council and on several Borough committees since
January 1994. In a private capacity Sayers is self - employed as a residential and light-
industrial building and remodeling contractor. Sayers operates the business, Donald
Sayers Contracting, and employs two full -time workers and several seasonal workers.
In 1994, Council entered into an agreement to sell the building in which it held
council meetings. The new property owners, who planned to tear down the existing
building and erect a senior - citizens highrise, agreed to provide space to Council in the
new building for its meetings.
When Council contemplated building a new Borough garage, Sayers was
requested by Council to draft specifications in light of his construction experience. As
per Council's request, Sayers also provided a cost estimate for the garage, which was
used as a gauge in reviewing submitted bids. Sayers did not charge the Borough for
his time. Sayers' estimate totaled $27,494 for the garage construction. After Council
advertised for bids, Dilcante of Pittsburgh submitted the only bid which amounted to
$45,819. Council tabled the matter with no action taken. Council wanted to consult
with the solicitor to determine whether it would be legal for Sayers to submit a bid.
A motion was made that if Sayers could not submit a proposal, bids would not be
advertised until the following spring. Sayers was present at the meeting and the
minutes do not reflect any abstention on his part from the vote. Council wanted
Sayers to handle the project but Sayers declined to do so unless the solicitor advised
that such action would be legal.
After the Borough Secretary/Treasurer contacted the solicitor to request an
opinion as to whether Sayers could be awarded the contract for the construction of
the Borough garage, the solicitor in a non -dated letter opined that the contract could
not be awarded to Sayers based upon his review of municipal law and the Ethics Law.
As a result of the solicitor's opinion, no action was taken in 1994 to award the
contract for the building of a Borough garage.
In February, 1995 Sayers presented new specifications for the Borough garage
to Council which advertised for bids in a local paper. The minutes of the April 4, 1995
Council meeting reflect that no bids were received and that the solicitor should be
contacted. At the May 2, 1995 Borough Council meeting, a motion was unanimously
approved to have the solicitor prepare the necessary documents so that Sayers could
Sayers, 97- 032 -C2
Page 15
do the construction work for the Borough garage. Although Sayers was present at that
meeting, no roll -call was taken nor were any abstentions recorded.
Council also considered whether it would be possible for Barry Downs, who is
the owner of Barry's Backhoe Service, to hire Sayers as a subcontractor to do the
Borough garage construction. Barry's Backhoe Service performed excavation work
such as pipeline and septic system installation but not building construction. At
Council's direction, Sayers contacted Downs to determine if he would be interested
in submitting a bid for the Borough garage. Downs inquired as to whether Sayers
would be interested in subcontracting the job. Sayers then helped Downs prepare the
bid specification for the Borough garage project.
At a July 11, 1995 Borough Council meeting, action was taken to readvertise
for proposals for the Borough garage project with the deadline for such bids as August
1, 1995. Barry's Backhoe Service was the only timely bid received, which amounted
to $28,000. While Sayers was assisting Downs in preparing the bid, Sayers provided
Downs with cost estimates for all of the project except the excavation. At the time
Downs submitted the bid to the Borough, it was agreed between Downs and Sayers
that Sayers would act as subcontractor on the project.
At an August 1, 1995 Council meeting, Council took action to accept the bid
from Barry's Backhoe Service. The minutes do not reflect the actual vote but merely
the presence of Sayers and the other Council members with no abstentions recorded.
As to the Borough garage project, Barry's Backhoe Service did the work for the
footer, prepped the floor area for concrete, dug and installed drains and brought the
site up to grade and landscaped the area. Donald Sayers Construction did the actual
construction of the Borough garage building.
At the September and October, 1995 Borough Council meetings, bills for Barry's
Backhoe Service relative to the Borough garage project were approved by Council.
Sayers was present and is not recorded as abstaining from approving payment of those
bills.
Of the $28,000 which the Borough paid for the Borough garage project, Sayers
was paid $25,420 for the construction work he performed as a subcontractor of
Barry's Backhoe Service.
After the Borough garage was completed, Council at a January 2, 1996 meeting
approved additional work on the new Borough garage so it would be usable for
meetings. The garage as constructed was neither insulated nor heated. Further, no
space was available in the garage for Council meetings or for office space. A motion
was unanimously approved by Council to finish the Borough garage with Sayers
overseeing the completion of the work. Sayers was present at that meeting and is not
recorded as abstaining from the vote. Council took such action as to the Borough
garage because the new owners of the old Borough property were not willing to give
Council space for meetings as had been promised.
For the additional work on the Borough garage, Council agreed to have Sayers
do the work with the Borough paying for the materials. Sayers agreed to do the work
and charged only for the labor of his employees but not his own labor. The Borough
paid $3,990 for the additional work on the project consisting of $3,000 for materials
and $990 for labor by Sayers' employees. The $990 was calculated based upon an
Sayers, 97- 032 -C2
Page 16
hourly rate of $18 for 55 hours of work. Sayers himself spent 68 hours of work on the
project, which would have totaled $ 1,224 at a rate of $18 an hour, but Sayers did not
charge the Borough for such work. At a February 6, 1996 meeting, Council voted to
approve payment of the $990 at which meeting Sayers was present and is not
recorded as abstaining from the vote.
Following completion of the additional work on the Borough garage, flooding in
July 1996 caused extensive damage to the garage which was discussed at an August
6, 1996 Borough Council meeting. Sayers submitted a breakdown of the cost of
repairing the damage which ranged between $4,000 - $6,000. No action was taken
by Council at that time to approve repairs. Since Council believed it could not afford
to pay an outside contractor to effectuate repairs, no bids were sought by Council.
Council wanted Sayers to make the repairs to the garage because he was a local
contractor who had actually built the garage and knew where to get matching
materials. After Sayers advised that the repairs to the garage would exceed $1,000,
he assigned several of his employees to work on the garage and supervised their work.
The Borough paid for the materials. After the repairs were completed, Sayers billed the
Borough in the amount of $1,206 based upon 68 man hours of work at $18 per hour.
The Borough then paid Sayers the $1,206.
Aside from the time which Sayers donated as to the Borough garage project,
Sayers performed other volunteer services for the Borough without charge. Fact
Finding 50. Lastly, as to the initial construction of the Borough garage, it appears that
Sayers made a profit of $662. Fact Findings 53 and 54.
Having summarized the above relevant facts, we must now determine whether
the actions of Donald Sayers violated Sections 3(a) and 3(f) of Act 9 of 1989.
In order to establish a violation, Section 3(a) requires a use of the authority of
office or confidential information by a public official /public employee 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.
In applying Section 3(a) of Act 9 of 1989 to the instant matter, it is clear that
there were uses of authority of office on the part of Sayers relative to the construction
of the Borough garage project. In particular, Sayers was present at different Council
meetings and was not recorded as abstaining as to the various actions taken as to
Borough garage project, including the payments after completion of the work. Sayers
as a Council member was also instrumental in preparing specifications and a bid
estimate for the initial construction. In addition, Sayers contacted Downs of Barry's
Backhoe Services and assisted Downs in submitting a bid for the project. Sayers was
aware of what was required for the Borough to accept such a bid. Clearly the above
actions were uses of authorities of the office. See Juliante, Order 809. Such uses of
authority of office resulted in a private pecuniary benefit consisting of the awards of
the contracts relative to the construction of the Borough garage, the improvements
therein and lastly the repairs after the flood damage. Finally, the private pecuniary
benefit inured to Sayers or Donald Sayers Contracting, a business with which Sayers
is associated, as that term is defined under the Ethics Law. See, 65 P.S. 402. Sayers
violated Section 3(a) of Act 9 of 1989 when he participated in actions of Council to
award a contract to build a Borough garage, to do additional work on the garage and
to repair the garage from flood damage and when he further participated in the
approval of payments for such contracts which were either awarded to a contractor
who awarded a subcontract to Sayers, or to Sayers directly.
Savers, 97- 032 -C2
Page 17
As to Section 3(f) of Act 9 of 1989, the facts reflect that as to the two
contracts involving the additional work on the Borough garage and the repairs for flood
damage to the garage, neither of those two contracts were advertised. Council in both
of those instances sought Sayers to perform the services without advertising for bids.
Each of those two contracts were in excess of $500. Accordingly, Sayers violated
Section 3(f) of Act 9 of 1989 when he contracted with the Borough to do additional
work on the Borough garage or to repair flood damage to the Borough garage through
contracts which were in excess of $500 but not awarded through an open and public
process. See, Lavertue, Order 1002.
As to the award of the Borough contract for the initial construction of the
Borough garage, we find no violation of Section 3(f) of Act 9 of 1989. As to that
particular project, the findings reflect that the Borough advertised for bids. The
contract, which was in excess of $500, was awarded to Barry's Backhoe Services.
Sayers worked with Downs of Barry's Backhoe Services on the bid proposal. However,
under these particular facts, we do not find any improper motivation on the part of
Sayers in dealing with Downs. After the Borough first advertised for the bids, Council
only received one bid which was high and unacceptable. After the Borough advertised
for bids a second time, no bids were received. It is clear that with the third round of
bidding by the Borough, Sayers sought to comply with Council's desire that he do the
work. Once Barry's Backhoe Service was awarded the contract, Sayers was awarded
the subcontract for the construction of the garage.
Although Section 3(f) of Act 9 of 1989 applies not only to contracts but also
to subcontracts, we do not believe that a subsequent bidding process as to the
subcontract itself is required. First, Section 3(f) refers to the requirements for bidding
as to contracts and subcontracts but only mentions such open and public process
requirement in the context of the contract itself but not the subcontract. Second,
although we are aware of our prior decision in Katz, Order 885, wherein we stated
that the bidding process of Section 3(f) not only applied to contracts but also to
subcontracts, we now state that the requirements for Section 3(f) as to an open and
public process relate to the award of the contract even though a subcontract is
subsequently awarded. Thus, upon further review, we believe that Section 3(f)
requires an open and public process but does not require a subsequent open and public
process where a subcontractor is involved.
In the instant case, since the contract as to the construction of the Borough
garage was over $500 and awarded through an open and public process, we find no
violation by Sayers as to his receipt of a subcontract from Downs of Barry's Backhoe
Services for that project. We do not believe this was an attempt to circumvent the
requirements of Section 3(f) through the use of subcontracting in this case. In this
regard, the findings reflect that it was the other members of Council who urged Sayers
to enter into those contracts.
However, Section 3(f) contains a prohibition that "the public official or public
employee shall not have any supervisory or overall responsibility for the implementation
or administration of the contract." Sayers should not have had any supervisory or
overall responsibility as to the implementation or administration of the contracts as to
the Borough garage.
In reviewing the findings it is clear to us that Sayers was not motivated out of
the desire for his own personal financial gain but rather in providing help to the
Borough. This is evidenced by the many hours of work and services he provided to the
Savers, 97- 032 -C2
Page 18
Borough without charge. Further, Sayers' involvement as to the three contracts for the
Borough garage were the direct result of entreaties from Council. Nevertheless, the
Ethics Law is applicable under these circumstances and we caution Sayers that he
must exercise care in the future so that his actions do not implicate the Ethics Law.
IV. CONCLUSIONS OF LAW:
1. Donald Sayers, as a Councilman in South Bethlehem Borough, is a public official
subject to the provisions of Act 9 of 1989.
2. Sayers violated Section 3(a) of Act 9 of 1989 when he participated in actions
of Council to award contracts for the construction, addition and repair of a
Borough garage to either himself or to a contractor who subcontracted with
Sayers.
3. Sayers violated Section 3(a) of Act 9 of 1989 when he participated in actions
of Borough Council to approve payments for the construction, addition and
repair of the Borough garage to either himself or to a contractor who
subcontracted with Sayers.
4. Sayers did not violate Section 3(f) of Act 9 of 1989 regarding a subcontract
that he received from the contractor as to the building of a Borough garage in
that the contract was awarded through an open and public process.
5. Sayers violated Section 3(f) of Act 9 of 1989 regarding the addition and repair
to the Borough garage in that such contracts were in excess of $ 500 and were
not awarded through an open and public process.
In Re: Donald Sayers
ORDER NO. 1075
File Docket: 97- 032 -C2
Date Decided: March 2, 1998
Date Mailed: March 6, 1998
1. Donald Sayers, as a Councilman in South Bethlehem Borough, violated Section
3(a) of Act 9 of 1989 when he participated in actions of Council to award
contracts for the construction, addition and repair of a Borough garage to either
himself or to a contractor who subcontracted with Sayers.
2. Sayers violated Section 3(a) of Act 9 of 1989 when he participated in actions
of Borough Council to approve payments for the construction, addition and
repair of the Borough garage to either himself or to a contractor who
subcontracted with Sayers.
3. Sayers did not violate Section 3(f) of Act 9 of 1989 regarding a subcontract
that he received from the contractor as to the building of a Borough garage in
that the contract was awarded through an open and public process.
4. Sayers violated Section 3(f) of Act 9 of 1989 regarding the addition and repair
to the Borough garage in that such contracts were in excess of $500 and were
not awarded through an open and public process.
BY THE COMMISSION,
t u e Lt.
DANEEN E. REESE, CHAIR