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HomeMy WebLinkAbout604 DefibaughMr. Harold R. Defibaugh Rte. 5 Bedford, PA 15522 Re: 85 -106 -C TAT1* E THICS QQMMISSION 308 FINANCE BUILDING HARRISBURG, P 17120 ORDER OF THE COMMISSION Order No. 604 DATE DECIDED: October 14, 1987 DATE MAILED: October 20; 1987 Dear Mr. Defibaugh: The State 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 Supervisor in Bedford Township, violated Section 3(a) of the Ethics Act, 65 P.S. §403(a), which prohibits a public employee's or public official's use of office or confidential information gained through that office to obtain financial gain other than compensation allowed by law because you continued to have the township pay the total cost of your participation in Blue Cross and Blue Shield, and Eye Glass and Prescription Drug coverage despite an auditor's motion on January 8, 1985, that working supervisors were required to pay 25% of the cost of the program. A. Findings: 1. You served as a Bedford Township Supervisor and Roadmaster from January 1982 to the present. a. Previously, you served as Township Supervisor from 1968 to 1973. b. You were also Township Roadmaster for two years during 1968 to 1973. 2. Township minutes of the supervisors' meeting of January 5, 1982, reflect that the annual meeting of the township auditors was on this agenda. Minutes indicated that 100% of the cost of Blue Cross /Blue Shield coverage was approved as a fringe benefit for calendar year 1982 by the township auditors. Mr. Harold R. Defibaugh Page 2 a. There was no indication that working township supervisors were required to pay 25% of the cost of. Blue Cross /Blue Shield coverage. b. There is no township resolution or ordinance confirming approval of this coverage. 3. Minutes of the township auditors' meeting of January 8, 1985, reflect that the auditors' approved a motion to have the township pay 75% of the Blue Cross /Blue Shield premiums for the working township supervisors. This approval was for calendar year 1985. 4. Review of Blue Cross /Blue Shield invoices for the period January 1985 to December 1985 at the township office disclosed that the township made the following payments for your medical insurance during 1985: CHECK NO. MONTH AMOUNT 2327 January $ 180.03 2396 February 180.03 2441 March 180.03 2514 April 180.03 2630 May 180.03 Not indicated June 180.03 - 2751 July 180.03 2868 August 180.03 2932 September 180.03 3009 October 180.03 3089 November 180.03 3163 December 180.03 Total 2,160.36 25% of Total $ 540.09 5. Two former township auditors advised that they initiated suit in the Bedford County Court of Common Pleas to force township supervisors, who accepted 100% of medical insurance coverage during 1985, to reimburse the township for 25% of this cost. a. None of the affected township supervisors have voluntarily reimbursed the township for the contested 25% of 1985 medical insurance costs. 16. You provided the following information in relation to the instant situation: a. You stated that during calendar year 1982 through 1984, working township supervisors had 100% of their medical insurance coverage paid for by the township if they participated in the program. This was approved by the township auditors. Mr. Harold R. Defibaugh Page 3 b. You advised that in January 1985, the township auditors voted to have working township supervisors pay 25% of the cost of their medical plans. c. In January 1986, two newly elected and one returning auditor voted to approve a 100% contribution by the township for the medical insurance plans of working township supervisors who desired such coverage. d. You related that an appeal of the 1985 township audit, by two former auditors, was pending in Bedford County Court. e. You stated that five township laborers received the benefit of having 100% of their medical insurance paid for by the township and also have a pension as part of their benefits. In comparison, working township supervisors are being told they must be satisfied with a township payment of 75% of their coverage during calendar year 1985. f. An individual in the office of the Association of Township Supervisors gave an opinion that the 25% of medical plan cost should not be borne by working township supervisors. g. You did not pay 25% of the cost of your 1985 medical insurance coverage. B. Discussion: As a township supervisor, you are a public official as that term is defined in the State Ethics Act. 65 P.S. §402; Sowers, 80 -050. As such, you are subject to the provisions of the Ethics Act and the restrictions therein are applicable to you. Generally, the State Ethics Act provides as follows: 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). Within the above provision of law, this Commission has previously determined that a township supervisor may not receive at the township's expense, health, hospitalization, medical and life insurance benefits when such supervisor acts only in the capacity of a supervisor. Krane, 84 -001; Cowie, 84 -010. Additionally, even if such a supervisor is employed by the township as a superintendent, secretary /treasurer, roadmaster or laborer in accordance with the Second Class Township Code, such benefits are considered Mr. Harold R. Defibaugh Page 4 compensation and must, therefore, be fixed as such by the township board of auditors. See Synoski v. Hazle Township, 93 Pa. Commw. 168, 500 A.2d 1 (1985); In re: Appeal of the Auditors Report of Muncy Creek Township, Pa. Commw. Ct.. , 520 A.2d 1241, (1987); Hunt, No. 348 -R. The foregoing principle was recently reaffirmed by Pennsylvania Commonwealth Court in Yocabet v. State Ethics Commission, Pa. Commw. , A.,2d (1987) filed at 834 C.D. 1986 on September 18, 1987. In the cited case, the Court held inter alia that a township supervisor violated Section 3(a) of the Ethics Act when he received a salary for the position of secretary /treasurer which had not been set by the auditors. The Court, in affirming the Order of the Ethics Commission which required a restitution of the financial gain, noted on page 5 of its Opinion: Section 7 of the Ethics Act instructs the Commission to investigate situations where there is a reasonable belief that financial conflict may exist, and if conflict is found, to require the offender to remove himself from the conflict without gain. Any benefits received other than as provided for above, would constitute a financial gain obtained in violation of the State Ethics Act. See, McCutcheon v. State Ethics Commission, 77 Pa. Commw. 529, 466 A.2d 283, (1983); Conrad v. Exeter Townships D & C 3d 253, (1983). These principles of law are now well settled and constitute the law under which this situation must be reviewed. See In Re: Report of Audit of South Union Township, 47 Pa. Commw. 1, 407 A.2d 906, (1979). In the instant situation, while you were an appointed township roadmaster and, therefore, eligible to receive the in question benefits, there would have to be the requisite approval by the township board of auditors for this to be considered part of your authorized compensation. See McCutcheon v. State Ethics Commission, supra. The facts in this case establish that the auditors, for the 1985 calendar year, only approved coverage for working supervisors to the extent that the township would pay 75% of the premiums for the prescription drug, eye glass coverage and Blue Cross and Blue Shield. Your assertion that the auditors may have approved in prior years and the one subsequent year a 100% contribution by the township is unavailing since it is clear that the auditors approved only a 75% contribution for 1985. In this regard, it is noted that two former auditors have filed suit against the township supervisors for reimbursement of 25% of the township contribution for the 1985 calendar year. It also should be noted that even if these benefits had been received in good faith, such would not be controlling. Good faith receipt of such benefits, even when based upon a solicitor's advice, will not alleviate the Mr. Harold R. Defibaugh Page 5 necessity of a public official reimbursing his governmental body for the receipt of a financial gain for which he was not entitled. See Allegheny County v. Grier, 179 Pa. 639, 36 A. 353, (1897); McCutcheon v. State Ethics Commission,_supra; Kestler Appeal, 66 Pa. Commw. 1, 444 A.2d 761, (1982). As a result, this Commission believes that you must reimburse the township for this financial gain. The State Ethics Act provides as follows: Section 9. Penalties. (a) Any person who violates the provisions of Section 3(a) and (b) is guilty of a felony and shall be fined not more than $10,000 or imprisoned for not more than five years, or be both fined and imprisoned. 65 P.S. 409(a). (c) Any person who obtains financial gain from violating any provision of this act, in addition to any other penalty provided by law, shall pay into the State Treasury a sum of money equal to three times the financial gain resulting from such violation. 65 P.S. 409(c). In addition to the above, the State Ethics Act provides that the Commission may forward the results of any investigation to the appropriate prosecuting authority unless the alleged offender removes himself from the conflict of interest by divesting himself of any financial gain received in violation of the State Ethics Act. 65 P.S. §407 9(iii). See also McCutcheon v. State Ethics Commission, supra; the Commission may order restitution of financial gains received in violation of the law. In view of all of the circumstances set forth above, you did receive a financial gain in violation of the Act, totaling $540.09, and that sum must be returned to the governmental body from which it was received. C. Conclusion and Order: 1. As a Township Supervisor in Bedford Township, you are a "public official" and, as such, are subject to the provisions of the Ethics Act. 2. You violated Section 3(a) of the Ethics Act when you received a gain through public- office consisting 100% of coverage for prescription drugs, eye glass and Blue Cross and Blue Shield at the township's expense when the auditors only approved 75% coverage by the township. Mr. Harold R. Defibaugh Page 6 3. The financial gain which you received and which was not part of the compensation provided for by law amounts to $540.09. 4. You are hereby ordered to remit to the State Ethics Commission, within thirty (30) days of the date of this order, a check in the amount of $540.09 made payable to Bedford Township as restitution for the financial gain that you received. 5. Failure to comply with the provisions of this order will result in a referral of this matter to the appropriate law enforcement authority for further civil or criminal proceedings. 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 15 days after service (defined as mailing) unless you file documentation with the Commission which justifies reconsideration and /or challenges pertinent factual findings. See 51 Pa. Code 2.38. During this 15 -day period, no one, including the Respondent unless he waives his right to challenge thisTrder, may violate this confidentiality by releasing, discussing or circulating this Order. 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). By the Commission, r G. Sieber Pancoast Chairman Mr. C. Harold Defibaugh R.D. 5, Box 392 Bedford, PA 15522 Re: Order No. 604, File No. 85 -106 -C JJC /na cc: Public Binder STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 17108 -1470 TELEPHONE (717) 783 -1610 November 12, 1987 Dear Mr. Defibaugh: On November 12, 1987, the State Ethics Commission received your payment for reimbursing Bedford Township as required by Order No. 604. We have forwarded your check No. 240 dated November 6, 1987, in the amount of $540.09 to Bedford Township. This letter will be made part of the Order and a public record as such. Si nc J: n J. Co ino Executiv Director