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HomeMy WebLinkAbout1118 PodluckyIn Re: Bernard Podlucky STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 File Docket: X -ref: Date Decided: Date Mailed: Before: Daneen E. Reese, Chair Austin M. Lee, Vice Chair Julius Uehlein Louis W. Fryman John J. Bolger Frank M. Brown Susan Mosites Bicket 98- 027 -C2 Order No. 1118 2/26/99 3/10/99 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 fft ggg., 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 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. Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter 11, Act 93 of 1998, which essentially repeats Act 9 of 1989 and provides for the completion of pending matters under Act 93 of 1998. This adjudication of the State Ethics Commission is issued under Act 93 of 1998 and 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 Chapter 11 of Act 93 of 1998. Any person who violates confidentiality of the Ethics Act is guilty of a misdemeanor subject to a fine of not more than $ 1,000 or imprisonment for not more than one year. Confidentiality does not preclude discussing this case with an attorney at law. Pod lucky, 98- 027 -C2 Page 2 I. ALLEGATION: That Bernard Podlucky, a public official /public employee, in his capacity as a Supervisor for Conemaugh Township, Cambria County, violated Section 3(a) 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 members of his immediate family when he participated in actions, discussions and decisions regarding township purchases from an auto parts store owned by his brother. II. FINDINGS: 1. Bernard Podlucky has served as a Conemaugh Township Supervisor since 1988. a. He served in the capacity of Police Commissioner from 1988 through 1997. b. He has served as an appointed roadmaster during his tenure as supervisor. 2. Podlucky also served as a member of the township sewer authority. a. He was employed by the authority in 1996 and 1997. 3. Podlucky owned a NAPA Auto Parts Store in Seward, Pennsylvania from 1990 until 1995. a. Podlucky purchased the Seward _ Store in 1990 from, his brother Gabriel Podlucky. b. He sold the store back to his brother in 1995. 4. Podlucky's brother, Gabriel Podlucky also owns a NAPA Auto Parts Store at 90 Teak Street, Johnstown, PA 15902. 5. The NAPA Auto Parts Store in Seward was closed by Gabriel Podlucky in April, 1998, due to a lack of sales. 6. Conemaugh Township purchased parts from both NAPA Auto Parts Stores owned by Bernard and Gabriel Podlucky from January, 1988, through April 6, 1992. 7. Between April 7, 1992, and February 4, 1993, Conemaugh Township did not make any purchases from the NAPA Auto Parts Stores located in Seward and Johnstown. a. This was during the time when Bernard Podlucky was being investigated by the State Ethics Commission as noted above. 8. Beginning on February 4, 1993, Conemaugh Township resumed making purchases from the NAPA Auto Parts Store in Johnstown, PA, owned by Gabriel Podlucky. a. Purchases included items such as batteries, anti - freeze and other parts for use on township vehicles. b. Purchases were made by township road department employees and the township police chief. Pod lucky, 98- 027 -C2 Page 3 c. Township employees were not directed to use NAPA by Bernard Podlucky 9. Conemaugh Township made purchases from the NAPA Auto Parts Store located in Johnstown, during the years 1993 through 1997 as follows: a. Year 1993 1994 1995 1996 1997 No. of Purchases 6 15 14 25 26 Total of Invoices $ 133.02 2,963.11 1,582.82 2,315.02 1,917.57 10. Township employees and the supervisors were authorized to sign for purchases from the NAPA Auto Parts Store owned by Podlucky's brother. a. Conemaugh Township did not have a policy regarding the purchase of supplies. 11. Podlucky signed for parts from his brother's NAPA Auto Parts Store on behalf of the township, on at least five occasions between 1994 and 1997. 12. In addition to the NAPA Auto Stores, Conemaugh Township also made parts purchases from Harvey's Supply Store during the years 1993 through 1997. a. Harvey's Supply Company, the main competitor for NAPA, is located in downtown Johnstown. 13. Total purchases by the township from the NAPA Store owned by Podlucky's brother in comparison to purchases from Harvey's Supply Store Company during the years 1993 through 1997, as follows: $27,709.67 $21,813.70 $17,858.84 $20,297.68 $16,845.49 $133.02 $2,963.11 $1,582.83 $2,315.32 $1,917.57 .04 13.50 8.80 11.40 11.38 $5,771.46 $5,603.99 $3,235.17 $3,258.73 $2,312.50 20.08 25.69 18.11 16.00 13.70 14. Podlucky participated in voting to pay bills, which include those to NAPA Auto Parts owned by Gabriel Podlucky, on a regular basis. a. Podlucky was present at all meetings in 1993 through 1996. b. Podlucky was absent from two meetings in 1997: 07/07/97 and 09/02/97 Pod lucky, 98- 027 -C2 Page 4 15. On three occasions Podlucky cast the deciding vote to approve payment of the bills in excess of $ 100, which included payments to NAPA Auto Parts owned by his brother, Gabriel Podlucky. a. 04/04/94 b. 06/03/96 c. 03/03/97 $362.99 $132.01 $156.40 16. Bill lists were voted on in their entirety at the monthly township Board of Supervisors's meetings. 17. Three signatures are required on township checks, the secretary/treasurer and two of the three supervisors. a. Podlucky signed 73 of the 89 checks issued to NAPA Auto Parts between 03/01/93 and 12/15/97. 18. Bernard Podlucky participated in the payment process of Conemaugh Township for payments to the NAPA Auto Parts Store owned by his brother as follows: a. Podlucky participated in thirty -eight (38) votes regarding payments under $50. b. Podlucky participated in seventeen (17) votes regarding payments between $50 and $100. c. Podlucky participated in the following twenty -eight (28) votes regarding payments in excess of $100: Date of Check Check No. Amount Check 02/07/94 5051 $150.83 02/07/94 5038 $299.91 03/07/94 5131 $509.66 04/04/94 5198 $362.99 05/05/94 5243 $134.97 06/06/94 5288 $175.79 07/05/94 5343 $224.17 08/04/94 5389 $198.86 09/06/94 5431 $373.20 10/03/94 5480 $135.06 11/04/94 5526 $193.43 07/03/95 5911 $131.63 07/30/95 5961 $656.68 09/05/95 6007 $160.41 09/25/95 6041 $197.41 01/30/96 6216 $157.44 03/04/96 6255 $276.74 04/01/96 6300 $159.96 05/05/96 6350 $128.73 06/03/96 6388 $123.01 Vote /Podlucky Signature on Unanimous/Yes Unanimous/Yes Unanimous/Yes Deciding Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Deciding Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Yes Podlucky, 98- 027 -C2 Page 5 07/01/96 09/06/96 10/03/96 12/15/96 03/03/97 04/05/97 04/05/97 07/17/97 6423 6523 6563 6693 6833 6871 6880 7029 $383.65 $108.74 $204.42 $101.16 $156.40 $592.42 $108.39 $127.73 Unanimous/Yes Unanimous/Yes Unanimous/Yes Unanimous/Yes Deciding Unanimous/Yes Unanimous/Yes Unanimous/Yes "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 Yes Yes Yes Yes Yes Yes Yes Yes 19. The NAPA Auto Parts Store owned by Podlucky's brother provided special pricing to Conemaugh Township. a. NAPA offers three pricing programs: Retail; regular garage discount; and Master Installer. b. Master Installer is the best pricing, and the percentage of discount varies according to the item. Participants must qualify through NAPA. Qualifications vary according to the item. c. Conemaugh Township was a participant of the Master Installer Program at the NAPA Store owned by Gabriel Podlucky. d. Under the Master Installer Program, percentage over cost varies from 2% to 8 %. 111. DISCUSSION: At all times relevant to this matter, the Respondent, Bernard Podlucky, hereinafter Podlucky, has been a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), Act 9 of 1989, Pamphlet Law 26, 65 P.S. §401, el seq. /Act 93 of 1998, Chapter 11, 65 Pa.C.S. §1101, el seq. The issue is whether Podlucky, in his capacity as a Supervisor for Conemaugh Township ( "Township "), Cambria County, violated Section 1103(a) of the Ethics Act as to the allegation that he participated in actions of the Board regarding township purchases from an auto parts store owned by his brother. Section 1103. Restricted activities. (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. §1103(a). Pursuant to Section 1103(a) of the Ethics Act, 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 the Ethics Act as follows: Section 1102. Definitions. Pod lucky, 98- 027 -C2 Page 6 a member of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 Pa.C.S. §1102. Section 1103(a) of the Ethics Act prohibits a public official /public employee from using the authority of public office /employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official /public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Having noted the issues and applicable law, we shall now summarize the relevant facts. Podlucky has served as a Conemaugh Township ( "Township ") Supervisor since 1988. In a private capacity, Podlucky was the owner of a NAPA Auto Parts Store in Seward. The store was originally owned by Gabriel Podlucky, Podlucky's brother, hereinafter Gabriel, until Podlucky purchased the store in 1990. In 1995 Podlucky sold the store back to Gabriel, who also owns another NAPA Auto Parts Store in Johnstown. The Township purchased parts from both NAPA Auto Parts Stores owned by Podlucky and Gabriel from January, 1988 through April, 1992. Because Podlucky was being investigated by this Commission, the Township did not make any purchases from either of the NAPA stores between April, 1992 and February, 1993. After February, 1993, the Township resumed making purchases from the NAPA Auto Parts Store owned by Gabriel. The purchases were made by the Township Road Department employees and the Police Chief. Podlucky did not direct the Township employees to make purchases from the NAPA stores. Township employees and Supervisors were authorized to sign for purchases from the NAPA store owned by Gabriel. The Township did not have a policy regarding purchase of such supplies. In addition to purchases from the NAPA Auto Parts Stores, Conemaugh Township also purchased parts from Harvey's Supply Store during the years 1993 through 1997. The chart in Fact Finding 13 reflects the percentage of Township purchases from NAPA as opposed to Harvey's Supply Store. Podlucky participated in voting to pay bills which included those from the NAPA Auto Stores owned by Gabriel. On three occasions, Podlucky cast the deciding vote to approve such payments for bills to Gabriel's NAPA Auto Parts Store which were in excess of $100. Such bill lists were voted on in their entirety at the monthly meeting of the Board of Supervisors. Three signatures are required on Township checks, that is, the Secretary/Treasurer and two of the three Supervisors. Podlucky signed 73 of the 89 checks issued to NAPA Auto Parts. As to the payments issued to the NAPA Auto Parts Stores owned by Gabriel, Podlucky participated in 38 of the votes involving payments under $50, 17 of the votes regarding payments between $50 and $100, and 28 votes as to payments in excess Parts Store owned Lastly, by pricing riel Gabriel with th the Township obtained from the NAPA Auto Y Ga was highest discount. Pod lucky, 98- 027 -C2 Page 7 Having summarized the above relevant facts, we must now determine whether the actions of Podlucky violated Section 1103(a) of the Ethics Act. In applying the provisions of Section 1103(a) of the Ethics Act to the instant matter, we find that there was a use of authority of office on the part of Podlucky. Although Podlucky was not involved in making any of the purchases from the NAPA store owned by Gabriel, he participated in approving payments to that business. Such actions constituted uses of authority of office. Perino, Order 980. The uses of authority of office resulted in a private pecuniary benefit to Gabriel's business consisting of the profit that the NAPA store received upon the sales of the items to the Township. The private pecuniary benefit inured to the NAPA store, which is owned by Podlucky's brother, who is a member of his immediate family as that term is defined under the Ethics Act. Accordingly, Podlucky violated Section 1 103(a) of the Ethics Act when he participated in 28 votes of the Township Board of Supervisors to approve payments in excess of $100 to the NAPA store, a business with which his brother is associated. However, we find no violations of the Ethics Act as to Podlucky's participation in votes to approve bills under $100 to a store owned by his brother, in that such amounts were de minimis. See, Schweinsburq, Order No. 900. The parties have submitted a Consent Agreement together with a Stipulation of Findings wherein it is proposed to resolve the case by finding a violation of Section 1103(a) as to Podlucky's involvement in purchases from NAPA that exceeded $100; no violation of Section 1103(a) as to those NAPA purchases which were under $100; and a payment of $1000 by Podlucky through this Commission to the Commonwealth of Pennsylvania, payable over a one -year period in eleven installments of $83 and one payment of $87, to commence within 30 days of the date of issuance of this order. Accordingly, Podlucky is directed to make the payment of $1000 as per the terms noted above. Compliance with the foregoing will result in the closing of this case with no further action. Noncompliance will result in the institution of an order enforcement action. As to the Stipulation of Findings and Consent Agreement filed by the parties, we believe that the Consent Agreement is the 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. Podlucky, as a Supervisor in Conemaugh Township, Cambria County, is a public official subject to the provisions of Act 9 of 1989/Act 93 of 1998, Chapter 11. 2. Podlucky violated Section 1103(a) of the Ethics Act when he participated in actions of the Board of Supervisors to approve payments in excess of $100 to a business owned by his brother. 3. Podlucky did not violate Section 1103(a) of the Ethics Act when he participated in actions of the Board of Supervisors to approve payments under $100 to a business owned by his brother as such were de minimis. In Re: Bernard Podlucky File Docket: 98- 027 -C2 . Date Decided: 2/26/99 Date Mailed: 3/10/99 ORDER NO. 1118 1. Podlucky, as a Supervisor in Conemaugh Township, violated Section 1103(a) of the Ethics Act when he participated in actions-of the Board of Supervisors to approve payments in excess of $100 to a business owned by his brother. 2. Podlucky did not violate Section 1103(a) of the Ethics Act when he participated in actions of the Board of Supervisors to approve payments under $100 to a business owned by his brother as such were de minimis. 3. As per the consent agreement of the parties, Podlucky is directed to make payment through this Commission to the Commonwealth of Pennsylvania, Department of Treasury in the total amount of $1000, payments to be made over a one -year period in installments of $83 for eleven months and one payment of $87, commencing within 30 days of the issuance of this order. a. Compliance with the foregoing will result in the closing of this case with no further action by the Commission. b. Non - compliance will result in the institution of an order enforcement action. BY THE COMMISSION, c&tlik),J6 DANEEN E. REESE, CHAIR