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HomeMy WebLinkAbout591-R DeRosa.7 Re: 87 -005 -C Dear Mr. DeRosa: Mr. Nick DeRosa 221 N. Cascade Street New Castle, PA 16101 STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 ORDER OF THE COMMISSION Order No. 591 -R DATE DECIDED: December 14, 1987 DATE MAILED: December 22, 1987 The Ethics Commission has received a complaint regarding you and a possible violation of Act 170 of 1978. The Commission has now completed its investigation. The individual allegations, conclusions, and findings on which those conclusions are based are as follows: I. Allegation: That you, a member of the New Castle City Council, violated Section 3(a) of the Ethics Act which prohibits a public official's or public employee's use of office or confidential information gained through that office for financial gain other than compensation allowed by law; Section 3(b) which prohibits a public employee, public official or candidate from offering, soliciting or accepting anything of value based on the understanding that the vote, official action or judgment of the public official, public employee or candidate will be influenced, and Section 3(d) which covers other areas of possible conflict pursuant to Section 7(9), in that you cast the deciding vote in favor of a resolution to award a $50,000 low interest loan from the city's revolving loan fund which would ultimately benefit the president of the school board, as an individual, to purchase a bar in return for your being appointed to an administrative position in the school district. A. Findings: 1. You have served as a member of the New Castle City Council for approximately the past ten years and are subject to the provisions of the State Ethics Act. a. You have also served as council president, most recently in 1986. 2. You have been employed by the New Castle School District for the past twenty years as a teacher and later as a temporary administrative assistant. Mr. Nicholas DeRosa Page 2 3. Records of the New Castle School Cist(ict regarding the selection process for the position of administrative assistant with the school district disclosed the following: a. January 9, 1986: Listing of all (32) school district personnel holding principal's certification. You are listed as holding a comprehensive certification (elementary and secondary). b. January 17, 1986: Form letter sent to all holding certificate from Joseph Martin, School of the position opening and requesting if interested to notify the office of superintendent by January 24, 1986. c. January 17, 1986: Copy of form letter addressed to you. d. February 5, 1986: Copy of schedule of interviewees to appear before caucus of the school board on February 5, 1986. You are listed along with other individuals. February 13, 1986: Letter addressed to you from Superintendent Martin that at the board meeting of February 12, 1986, you were elected as temporary part -time administrative assistant effective February 17, 1986. f. August 14, 1986: Letter to you from Martin advising the position was continued until February 27, 1987, as a result of the board decision :of August 13, 1986. February 12, 1987: Letter from Martin to you advising the position was continued for the balance of the school year. 4. Minutes of the meetings of the New Castle Area School District disclosed the following: a, February 12, 1986: Temporary part -time administrative assistant,. Board action required to hire Nicholas DeRosa, on a temporary basis, as a part -time administrative assistant for the balance of the school year beginning February 17, 1986. DeBlasio, Alexander, Papa and Withrow each give reasons for their vote. Pi cci one, Bonel 1 i and Cook also give reasons for their vote. Mr. Nicholas DeRosa Page 3 Motion Lastoria, second Flora that the board approve the hiring of Mr. DeRosa a set out above. Ayes: Flora, Lastoria, Piccione, Bonelli, Cook. Nays: DeBlasio, Alexander, Papa, Withrow. b. August 13, 1986: Temporary administrative assistant. Board action was required to Nicholas DeRosa, on basis, as an administrative assistant commencing with the school term, until February 27, 1987. Mr. DeRosa employed at such position at his present level of compensation. Motion Lastoria, second Flora that the board hire Mr. DeRosa on a temporary basis as an administrative assistant as set above. Ayes: Alexander, Bonelli, Flora, Lastoria, Papa, Piccione, Withrow, Cook. Nay: DeBlasio. a temporary the beginning of shall be c. Records also confirm that you were reappointed to the position of administrative assistant at the February 11, 1987 meeting of the school board to continue to the end of the school year. Charles Cook is reflected as voting in favor of your appointment. 5. New Castle Superintendent, Joseph Martin, advised the position of administrative assistant was being filled to assist in obtaining grants for the school district. Martin also stated: a. He disagreed with the hiring because of the distressed financial condition of the board, and the district already had a person working on grant applications. b. You were chosen after all qualified persons in the district were notified. You were one of four persons notified and interviewed. 6. Interviews with members of the school board disclosed as follows: a. Gary Bonnelli: Approximately one year ago, board member Chuck Cook brought up the idea of an assistant administrator to pursue federal grants. Mr. Nicholas DeRosa Page 4 b. Albert La Cook had nothing to do with the appointment of you. That came out of the education committee, Cook was not a member. c. Thomas Piccione: He did not know who introduced the position to the board. There were no deals to appoint you. He was satisfied with the current grant administrator. d Ronald Alexander: Your name was voted on at least three occasions. He does not know if Cook advocated you for the position. He voted no the first time because the district had a grant administrator. Cook, as board president, did sit in on committee meetings, including education, and voted on tie breakers. e. Elaine Withrow: The position came out of the education committee. The position was put up for bid. The entire board was invited to be present for the interviews. The education committee was composed of Flora, Lastoria, Borelli, Papa and herself. She had a discussion with Cook regarding how she would vote, but he did not pressure her. f. Samuel Flora: The position was advertised and there were four applicants including you. The existing grants administrator had enough to do. The position was temporary and could be eliminated. It was his opinion you were the best qualified. He was not approached by Cook on how he would vote. Larry DeBlasio: He voted against the position because he did not think there was a need for it. He was not on the education committee and has no knowledge of what occurred. He was not approached by Cook about his vote, he was against it from the beginning. When board member Papa graduated from law school, you had a party at the Joy Gardens which you own. Cook was pulling for the position. 7., Charles Cook has been a member of the New Castle Area School Board since, at least, 1983. Cook is also a former New Castle City employee. Cook owns the Pirate Cafe, Incorporated, also known as the Fan Club. Cook also does business as Allstar Realty Company. 8. Records confirm that an agreement of sale was entered i nLo on May 7, 5986, between Charles Cook and Edward and Roberta Fisher for the purchase of the Pirate Cafe. The May 7, 1986 agreement of sale was as follows: a. The consideration in the amount of $85,000.00 for all the shares of stock of Shareholder shall be paid at the time of settlement as follows: Mr. Nicholas DeRosa Page 5 The sum of $75,000.00 in cash at the time of settlement; The delivery by Buyers of a promissory judgment note payable by Buyers to Shareholder in the principal amount of $10,000,00, said promissory judgment note providing for payment of said principal sum, together with interest at the rate of 9% per annum, over a period of 7 years from the date settlement in equal monthly payments with the said monthly payments to being on the first day of the month following the date of settlement. The purchase price for the above described real estate herein sold from Cook to Buyers shall be the sum of $65,000.00, payable in cash to Cook at the time of settlement. b. The agreement of sale settlement date was later extended to July 31, 1986. c. By letter dated August 11, 1986, Cook agreed to Finance $90,000 of the costs. 9. Records obtained from the New Castle Redevelopment Authority regarding a proposed loan to Edward Fisher to purchase the Pirate Cafe disclosed as follows: a. Letter from Charles Cook to Edward Fisher advising that he agreed to the Fisher request and commits to finance $90,000 of the purchase price of Pirate Cafe, Incorporated. b. September 2, 1986: Council memo No. 437 from Dennis Lemieux, City Business Administrator, to Mayor and member of council advising that a majority of council wished to allocate $50,000 in Community Development funds to Ed Fisher to utilize in the purchase of the Fan Club (Pirate Cafe). A resolution approving the request will appear on the next agenda. c. September 2, 1986: Council memo No. 438 from Lemieux to the Mayor and Council documenting his position on the loan to Fisher: In view of the fact that the City Solicitor has recommended that the Ethics Commission be contacted to determine if the Council President has a conflict of interest, (Employer /Employee relationship) it is incredible to think that the City Council would act on this request prior to such a ruling. In addition, I think this type of project warps the meaning of economic development. Mr. Nicholas DeRosa Page 6 I am often asked at speaking engagements (service clubs, etc.,) why more progress is not made in the City. From my hear when I see actions such as this or the attempt to reverse the home rule ordinance; totally devoid of reason, it is little wonder why more progress cannot be made. There are many decisions made by elected officials that 1 must administer whether I personally agree with or not. I feel I do these to the best of my ability; however, I must decline to be involved with either of the two projects mentioned above out of circumstances from which they have arisen. d. September 24, 1986: Correspondence to you, president of city council, from J. Stevenson Suess representing Edward Fisher stating that action of the Fisher loan may violate Sunshine Laws and authority loan regulations. e. September 29, 1986: Reply to Suess from Daniel Herman, Authority Solicitor. f. October 2, 1986: Letter from Dan Witmer, City Attorney to Suess advising that he was not aware of any requirement that .loan applications be approved or disapproved by formal action of city council. g. November 26, 1986: Letter from Joseph Bullano, Attorney for Fisher, outlining conditions of finance approval for the Fisher loan giving first mortgage lien to the City. December 10, 1986: Letter from Dan Witmer, City Attorney to Michael Donadee, Chief Counsel, Department of Community Affairs, outlining the Fisher loan application, your employment and connection with Charles Cook, seller of the property to Fisher and requesting an opinion on the Fisher proposal. i. January 8, 1987: Letter from George Howley, Director of Community Development, to Donadee enclosing resolution approving loan to Fisher. j. February 23, 1987: Letter from Howley to Kenny Wilson, Department of Community Affairs Program Analyst, encl os i ng Fisher application for review. K. February 20, 1987: Fisher reapplied for application. 10. Minutes of the meetings of New Castle City Council disclosed the following: Mr. Nicholas DeRosa Page 7 a. September 11, 1986: Lengthy meeting on proposed loan to Edward Fisher. No action taken. You, as council president, were present and participated in the discussion. You state to Fisher that he met all the criteria. b. December 23, 1986: Resolution R- 1986 -388, approval to include Edward E. Fisher in the Economic Development Program in the amount of $50,000 to purchase the Pirate Cafe, .Inc. and authorizing the Mayor to execute any necessary documents. Resolution: WHEREAS, the City of New Castle has previously received funds from the Block Grant activities under the Community Development Program to undertake economic development activities; and WHEREAS, the City desires to undertake additional economic development activities from the program income of the loan funds generated from these programs; and WHEREAS, the City shall receive a first lien position from Mr. Fisher and the seller of the Pirate Cafe, Inc., Charles Cook (Charles Cook shall personally guarantee said first lien priority). If Mr. Fisher defaults in his payments to the City, the city will then require Mr. Cook to immediately pay the balance in full. NOW, THEREFORE, BE IT RESOLVED BY THE COUNCIL OF THE CITY OF NEW CASTLE, THAT: Approval to include Edward E. Fisher in the economic development program in the amount of $50,000.00 is hereby given and the Mayor is hereby authorized to execute any necessary documents. The aforementioned commitment is conditioned upon the project meeting all local, state and federal requirements and the conditions specified in the recitation of the instant resolution, where is hereby incorporated herein, and the participant providing necessary documentation for closing within ninety (90) days of approval. Discussion follows: Councilperson Verterano urges you to reconsider if you are intending to vote in view of the letter received from the Ethics Commission. She hoped that you would abstain on the matter. Mr. Nicholas DeRosa Page 8 You stated that we (Council) have passed every loan application recommended by the redevelopment authority, and this met their guidelines. All of a sudden council is refusing one. You also stated that you were an employee of the school district for _twenty (20) years, long before Cook ever thought of running for school board. Mr. Cook was not applying for the loan. We never met with Mr. Cook. You received two (2) letters from the Ethics Commission, the first.with wrong information. The second one only recommended that you not vote. You called the Ethics Commission and spoke with the Executive Director and a Mr. Caruso, that they are all attorneys and have opinions. Everyone has an opinion and that is the way you are going to vote on that, and you thought council said everything they had to say. You have no letter saying that you cannot vote. That is what you have to go on. If you had a letter saying that you could not vote on the issues then you would not vote, plain and simple. Roll call vote: AYES: Russo, Costello, DeRosa NAYS: Verterano, Christofer c. January 8, 1987: Citizen Comments: Charles Cook. The second comment I would like to make is to my lifelong friend and good - buddy, Nick DeRosa. I wanted to say I appreciate the job you have done for us as the council president over the years, and I want to tell you that I full heartedly backed you and supported you in each and everything you have done. Cook also states that he talked to all of the councilmen on the phone in reference to comments regarding the Fan Club loan. Cook stated that he went to the Department of Community Affairs about the loan. He commended Nick DeRosa for voting for the loan. He stated if any of them have a problem with your vote, tell them to take you to court and I will help you with the monies. 11. Wayne Cioffi, Assistant Director of the New Castle Redevelopment Authority advised as follows: a. Following a council caucus meeting in August 1986, you handed him an application saying someone asked you to give the application to Cioffi. This was an application from Edward Fisher. It was unusual for an application to be delivered in that manner. Mr. Nicholas DeRosa Page 9 b. The application was for a $50,000.00 loan from the Revolving Loan Fund Program of the Community Developments funds to purchase the Pirate Cafe, Inc., expansion and equipment. c. The Pirate Cafe, Inc. is a bar and restaurant. The original application also indicated that there would be male and female dancers. d. He asked city business manager Dennis Lemieux what to do and was advised to present it to council. e. The application was reviewed unfavorably by council. Council expressed concern both about the dancers and the bar and wondered whether it was worth it. The application was not voted on and Cioffi returned the application to Fisher and informed that it did not look good. f. Charles Cook then got involved and stated that the deal was going to be completed with local funds. Cook contacted State Representative, Thomas Fee, and complained that the Authority and Council was discriminating. Fee contacted the Department of Community Affairs to review the matter. The Department of Community Affairs began reviewing the matter in December, 1986, after the matter passed by a 3 to 2 vote of council. You never pressured him regarding the loan. g. 12. Dennis Lemieux, former New Castle Business Manager, advised as follows: a. Following an August 11, 1986 meeting between the New Castle School District and City Council, he and councilperson Elizabeth Verterano talked to Charles Cook, President of the School Board, at the Olde Library Inn. Cook stated the two governing bodies should work together on common issues. Cook indicated that he cooperated with the City by getting Dickie Costello's (Councilman) wife a job with the Vo -Tech. He also stated, "I got Nickie his job." He said cooperation began with him (Cook) getting his old job back with the city. b. In August or September of 1986, you gave Cioffi an application from Ed Fisher to buy out the Fan Club. c. On September 11, 1986, at meeting of council, you tried to get city council to commit funds with little or no review. No vote was taken. It was agreed to have the solicitor seek a ruling from the Ethics Commission because of your relationship with Cook. P1r. Nicholas DeRosa Page 10 - d. He, subsequently, sent a memo to council and the Mayor stating he refused to be associated with or work on the project. (Related to 9c). e. The following day you called him and discussed the loan and also stated he was dealing with powerful people and to watch himself. He interpreted this as a threat to his job. f , You, subsequently, reviewed.his employment agreement with the city. g. At the next council 'fleeting, you stated that he was over - stepping his bounds by not taking council direction and to start getting resumes out. h. He left the employ of the city on November 7, 1986, and up until that time, there was not a majority of council supportive of the loan. 13. Councilperson, Elizabeth Verterano, confirms the conversation between Charles Cook, Dennis Lemieux and herself following the joint meeting. She stated that Cook said we've given Nick the job he wanted and we've obtained a job for Dick's (Costello) wife. Cook also asked if she and Lemieux would lobby to get his job back. She also advised: a. She told you not to vote based on the State Ethics Commission opinion. She said that you replied that the State Ethics Commission's opinion was only one attorney's opinion, get 100 attorneys and you'll get 100 opinions. 14. Councilman Richard Christofer advised as follows: a. He was against the Fan Club from the beginning. b. Two (2) Fridays before Labor Day, 1986, Cook called him stating he was upset that he was against the loan. c. Cook said that if he changed his vote, his wife could be made a secretary at the school. He coul d not consider that. Cook also said something that if he changed his vote he could have whatever it took. d. Prior to November, 1986, elections at the Cally Club, Cook stated to him that he should have gotten Costello's vote before he gave his wife a job. Mr. Nicholas DeRosa Page 11 e. On election night, at the headquarters of Frank LaGrotta in Ellwood City. Cook related that a meeting occurred on Labor Day weekend at the home of Costello. Present were Cook, Councilmen Russo, Costello and you. An agreement was reached where they would vote for the Fan Club and also a project that Russo was advocating. f. Cook contacted him on two other occasions pressuring him to reconsider his decision by offering political support in the upcoming elections. 15. Both Councilmen, John Russo and Richard Costello, confirm that there was a meeting at Costel l o's house also attended by you and Cook. They admit that the Fan Club (Pirate Cafe, Inc.) loan was discussed along with another project. They claim no agreement was reached. a. Costello denied there was a deal to get his wife a job at the Vo -Tech. He said Cook was only one person, that he had three (3) or four (4) other friends on the board. b. Costello was against the loan, but changed his position after the city got the first lien on the property. 16. Former Solicitor, Dan Wimer, advised as follows: a. The normal procedure for a loan application is to submit it to the Redevelopment Authority, then to council for a vote. b. A day after writing to the State Ethics Commission for an advice, DeRosa told him not to write saying the matter was not a conflict. c. He sent two letters to the State Ethics Commission for advice. The first was worded incorrectly. After receiving the letters, he gave copies to you, other councilmembers and the Mayor. d. He consistently advised that it was a conflict for you to vote. e. At some point, you stated we are going to get this passed before the end of the year. f. He was at a caucus meeting when Dennis Lemieux informed council that he could not recommend the loan and you told Lemieux he Netter start sending out resumes. 17. On September 2, 1986, Solicitor Wimer had requested the advice of the State Ethics Commission regarding whether you could participate in council 's consideration of the loan request. Mr. Nicholas DeRosa Page 12 18. On September 23, 1986, Advice Nc.. 86 -605 was issued in response to Mr. Wimer's request concluding that: a.. "a city councilmember who is also an employee of a school district, may not participate in the consideration or decision of city council in relation to the granting of a low interest loan to an individual who is a member of the school board that employes the city councilmember. His abstention in this matter along with the reasons, therefore, should be publicly noted and recorded." 19. On October 2, 1986, Mr. Wimer responded to the advice and indicated that one fact, as outlined, was incorrect. Mr. Wimer indicated that the low interest loan would not be granted to the employer (school board member), but would be granted to a third party who would use the funds to purchase property owned by that person. 20. On October 20, 1986, Advice No. 86 -605 -A was issued to Mr. Wimer. That advice, in part, provided as follows: a. Clearly, under Section 1 of the State Ethics Act, it would probably be the better practice for this individual to abstain from participating in the award of this low interest loan even though it does not directly benefit his employer. There is no doubt that the funds will go to purchase the tavern owned by the school director. The city councilperson obviously is aware of where the funds will ultimately be disbursed. Additionally, the fact that this city councilmember has, just recently, been appointed [to] two new positions within the school district could create substantial questions within the above provisions of the law. As such, and in order to avoid any adverse impact from such a vote, it would still be recommended that this individual abstain from participating in the council's award of this low interest loan to the third party who will purchase the bar from the school director. 21. Mr. Cook provided the following information: a. inc selling price of the Fan Club was $150,000.00 to be paid as follows: $20,000 down $80,000 Financed by Cook $50,000, City Loan b, He provided favorable comments on behalf of Mrs. Costello in relation to the position of employment with the school district. Mr. Nicholas DeRosa Page 13 . c. The administrator made the recommendation to hire Mrs. Costello. d. He denied attending a meeting at Mr. Costello's house with you. e. He denied any relationship between your position of employment with the district and the approval of the loan. 22. You provided the following information: a. You stated that Charles Cook was president of the school board when the concept of the administrative assistant developed. b. You deny personally delivering the Fisher loan applications to the Redevelopment Authority. c. You indicated that you did personally deliver an amended application as a favor to Mr. Cook. You state that you delivered the application after a chance meeting with Mr. Fisher and, further, that you delivered many envelopes for people to different departments. d. You have no knowledge of how Councilmember Costello's wife came to be employed by the school district. e. You deny placing any pressure on Mr. Costello in order to secure his vote for granting the loan. f. You deny knowing that the funds granted to Mr. Fisher would be used to purchase the property. (i) You stated that the funds could be used to expand the property and Mr. Cook would not :- :;ive any proceeds from the loan. 9. (ii) You further state that it was the Fishers, but not Mr. Cook, who were seeking the loan. You did not interpret the Ethics Commission's advice as requiring your abstention. h. You deny there was any quid pro quo for your being appointed as temporary administrative assistant and, further, that there is any "connection" between you and Mr. Cook. i. You assert that Mr. Cook's statement that he (Cook) got you your job is a "braggadocio" and that you got the position of temporary administrative assistant through established channels for hiring. Mr. Nicholas DeRosa Page 14 You further state that you are a tenured school employee with permanent certification and that you got your job because of your qualifications and job performance. j. You state that Mr. Cook did not get his job back with the City and, further, that the Mayor, but not City Council, does the hiring. k. You assert that you initially opposed the Fisher loan for two reasons: the male - female dancers and the lien priority as to the property. You state that City Council never refused a CDBG loan which was recommended by the Redevelopment Authority. 1. You state that the Fisher loan process occurred in a public forum with public debate and media attention. B. Discussion: You, as a member of the New Castle City Council, are a "public official" as that term is defined in the State Ethics Act. Accordingly, you are subject to the provisions of the Ethics Act and the restrictions therein are applicable to you. Section 3(a) of the Ethics Act provides: Section 3. Restricted activities. (a) No public official or public employee shall use his public office or any confidential information received through his holding public office to obtain financial gain other than compensation provided by law for himself, a member of his immediate family, or a business with which he is associated. 65 P.S. §403(a). It s further provided in Section 3(b) of the Ethics Act: Section 3. Restricted activities. (b) No person shall offer or give to a public official or public employee or candidate for public office or a member of his immediate family or a business with which he is associated, and no public official or public employee or candidate for public office shall solicit or accept, anything of value, including a gift, loan, political contribution, reward, or promise of future employment based on any understanding that the vote, official action, or judgment of the public official or public employee or candidate for public office would be influenced thereby. 65 P.S. §403(b). Mr. Nicholas DeRosa Page 15 Section 3(0 of the Ethics Act provides: Section 3. Restricted activities. (d) Other areas of possible conflict shall be addressed by the commission pursuant to paragraph (9) of section 7. 65 P.S. §403(d). Factually, while serving,as a member of the New Castle City Council, you applied for the position of administrative assistant with the New Castle School District in January of 1986. In February, 1986, you were elected as temporary, part -time administrative assistant. School hoard member Cook cast the deciding vote in favor of your employment; also, in August of 1986, he voted in favor of employing you as a temporary administrative assistant. In May of 1986, Mr. Cook entered into a sales agreement for the Pi rate Cafe with Edward and Roberta Fisher with a projected settlement date of July 31, 1986. Mr. Cook agreed to finance $90,000.00 of the purchase price. A request for an application of $50,000.00 in Community Development funds for the Fisher purchase of the Pirate Cafe, also known as the Fan Club, was submitted to the Mayor and Council. At that time, the city solicitor recommended that an advice request be sent to this Commission since you, as council president, were also an employee of the School District of which Mr. Cook was a board member. An advice of counsel was issued wherein you were advised that it would be the better practice for you not to vote in light of your relationship with Mr. Cook. Nevertheless, you voted in favor of approval of the inclusion of Edward Fisher in the economical development program in the amount of $50,000.00, relative to his purchase of the Fan Club from Mr. Cook. Mr. Cioffi, who is the assistant director of the New Castle Redevelopment Authority advised that city council initially looked unfavorably upon the application for the $50,000.00 loan, but Mr. Cook got invovled in the matter, contacted a state representative who contacted the Department of Community Affairs which did review the matter after it passed city council by a three to two vote. Mr. Lemieux advised that he had a meeting with Mr. Cook and council person Verterano wherein Mr. Cook stated that he got jobs for both you and councilman Costello's wife. The foregoing is confirmed by councilperson Verterano. Mr. Lemieux further stated that at a council meeting on September 11, 1986, you tried to get the council to commit funds for the Ed Fisher application with little or no review. Councilman Chri stof er states that at a meeting at councilman Costello's house, attended by Mr. Cook, councilmen Russo, Costello and yourself, an agreement was reached whereby the councilmen would vote for the Fan Club matter and also for a project that Russo was advocating. Councilmen Russo and Costello denied that an agreement was reached although they do admit that the loan was discussed along with another project. Mr. Nicholas l)ekosa Page 16 Although Mr.'Ccok admits that he made favorable comments regarding Mrs. Costello's employment position, he states that the administrator made the recommendation to hire her. He also denies meeting at Mr. Costello's house and denies that there is any connection between his relationship with you and the approval of the loan. You state that you have no knowledge as to how Mr. Costello's wife became employed by the School District. You further deny placing any pressure on Mr. Costello regarding his vote for the granting of the loan. Lastly, you indicate that you interpreted the Ethics Commission advice as not requiring mandatory abstention. Based on the above facts and circumstances, this Commission must decide whether there have been violations of the either sections 3(a), 3(b) or 3(d) of the Ethics Act. In reaching a decision, this Commission has reviewed past orders involving analogous situations. In Marcincin, 532, the question presented was whether the mayor of a city violated the Ethics Act by participating in the sale of city realty to an individual who gave his son a $20,000.00 interest free loan. The evidence in that case established that the mayor performed 'onl;, "✓ those functions relative to the property which were routine in nature. He did not personally get involved in the city's review or consideration of the sale of the property. Based upon insufficient evidence and the fact that the son was an adult not residing in the mayor's household, this Commission found that there was not a violation of Section 3(b) of the Ethics Act. In the instant situation, there is insufficient evidence to establish that you violated Section 3(a) of the Ethics Act. The testimony of councilperson Christofer that an agreement was reached whereby you, Mr. Russo and Mr. Costello would vote for the Pirate Cafe loan if support was given to a project that Mr. Russo was advocating is denied and contradicted by Councilpersons Russo and Costello. The evidence before this Commission does not factually establish the requisite interrelationship between your vote as a city councilman to award a loan to the Fishers who purchased the Pirate Cafe from Mr. Cook and the hiring of you, by the school board, for the position of temporary administrative assistant. This Commission finds that there is no violation of 3(b) of the Ethics Act because there is insufficient evidence to establish that you accepted anything of value based on the understanding that your vote or official action would be influenced thereby. Similarly, the evidence is insufficient to establish a violation of Section 3(d) of the Ethics Act. Mr. Nicholas DeRosa Page 17 _ C. Conclusion and Order: 1. As a member of a city council, you are a public official as that term is defined in the State Ethics Act. 2. There is insufficient evidence to establish that you violated either Section 3(a), 3(b) or 3(d) of the Ethics Act when you cast a deciding vote to approve a loan for a third party that would be used to purchase a business from an individual for whom you worked. Our files in this case will remain confidential in accordance with Section 8(a) of the Ethics Act, 65 P.S. 408(a). However, this Order is final and will be made available as a public document 5 business days after service (defined as mailing). Any person who violates the confidentiality of a Commission proceeding is guilty of a misdemeanor and shall be fined not more than $1,000 or imprisoned for not more than one year or both, see 65 P.S. 409(e). The confidentiality provision does not restrict respondents consultation with legal counsel. ' By the Commission, Qt G. Sieber Pancoast Chairman