HomeMy WebLinkAbout654 NuzzoMr. Ralph Nuzzo
McCombs Circle
New Castle, PA
Re: 87 -110 -C
Dear Mr. Nuzzo:
A. Findings:
STATE ETHICS COMMISSION
308 FINANCE BUILDING
HARRISBURG, PENNSYLVANIA 17120
ORDER OF THE COMMISSION
Order No. 654
Date Decided: J1W P 10, 1988
Date Mailed: :limp 74, 19R8
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 former Union Township Supervisor,
violated Section 3(a) of the Ethics Act which prohibits a public
employee's or public official's use of office or confidential
information gained through that office,to obtain financial gain,
in that you participated in a group life insurance policy with
the Trustees Insurance Fund in 1985 paid for with township
funds.
1. You were appointed as a Union Township Supervisor in August
1984, to fill the unexpired term of Ben Cooper. You completed
this term on December 31, 1985.
a. You were elected to a new term in January 1988, and are
currently serving as a Union Township Supervisor.
2. You were not otherwise employed by the township.
3. Life insurance for township employees and supervisors is
administered by the Trustee's Insurance Fund, 3001 Gettysburg
Road, Camp Hill, Pennsylvania 17011.
4. Trustee's Insurance Fund invoices record the following
payments for your life insurance coverage.
Ralph Nuzzo
Page 2
a. 7/18/85 $53.97 Check #50 June, Juy, August 1985
b. 8/21/85 $215.88 Check #6015 One year coverage
Total $269.85
c. Refund issued to the township from Trustee's Inaurance
Fund on 4/7/86 on your behalf - $77.18.
d. Total payments by the township for your life insurance
coverage $192.67.
5. A review of the minutes of the meeting of the townshir board
cf auditors for the years 1978 through March 1984 indicate
discussions or consideration of insurance, health cr
hospitalization benefits as part of the compensation for el,- 2loyee
supervisors. The minutes further indicate as follows:
a. March 12, 1984 - A special auditor meeting was held.
Roadmasters wage was set at $7.21 per hour; time and
one half after 48 hours.
Insurance was to be paid for the roadmaster only, due
to a ruling by the Ethics Commission.
b. January 8, 1985 - road supervisors salary set t
$16,000 per year. Salary to include vacation, holiday:
and sick pay and insurance.
c. From January 1986 through 1987 there was no mention of
insurance, health or hospitalization benefits fcr
supervisors.
(i) Documents obtained from the township auditor
reflect the following regarding the above:
(a) The board of auditors have changed the
previous minutes due to the fact that
Solicitor Gabriel Cilli informed of
specific insurance changes.
(b) Salary for roadmaster, Cumberledge, is
$16,000.00 per year or $640.00 bi- weekly
with no overtime.
Mr. Ralph Nuzzo
Page 3
(c) Roadmaster entitled to same benefits as
road workers, which are 10 sick days, 12
holidays, Blue Cross /Blue Shield, major
medical, vision care and life insurance.
(d) Vacation received according to years of
service as roadmaster.
(e) The other two supervisors, Fee and
Nuzzo, are to be paid $5.00 per hour for
duties performed in the township.
d. January 13, 1988 - Special meeting to set
the roadmaster. No decision was reached.
e. January 27, 1988 - Special meeting to set
the roadmaster. No decision was reached.
Present - Fee, Cumberledge and Presnar.
b. 8/21/84 - Motion to appoint Cumberledge as road
superintendent. Motion carried, fee voted no.
benefits for
benefits of
6. Minutes of the Union Township Board of Supervisor's meetings
reflect the following:
a. 6/24/84 - Motion to appoint Ralph Nuzzo to fill the
vacancy of Benjamin Cooper. Motion carried, Fee voted
no.
Present - Fee, Cumberledge and Nuzzo.
c. 1/7/85 - Motion to appoint Cumberledge as road
superintendent. Motion carried, Fee voted no.
Present - Fee, Cumberledge and Nuzzo
Motion to appoint Mrs. David Byler as township auditor
replacing Judi Budai. Vote unanimous.
d. 1/15/85 - Motion made by Cumberledge, seconded by Nuzzo
that all insurance benefits and hospitalization given
to the township supervisor be granted through the
township auditors. Vote unanimous.
(i) The township auditors were present to voice
their views on the salary on the road
Mr.. tap. Nv.z ^o
Page 4
superintendent and also that ':hey i t - ne •' O
check into the subject of insurances
supervisors.
7. the minutes of the supervisor meeting do not rei1(
appointment tc) any position of employment with the towl.sh'
8. records on file with the Union Township Auditors contain teir
following correspondence:
a. 1/18/85 - letter from Township Secretary /T:e&surcr,
Susan Currie to Cathy Schmidt, auditor.
At the regular meeting of the Union. I'own:Ahi^
Supervisors held on January 15, 1985, the boars'
unanimously agreed that all insurance benefits and
L given to the township supervisors 'fie
granted through the township auditors.
Therefore, as soon as possible, a special ...K et :'ng
should be set by the township auditors.
b. 3/13/84 - letter from the Union Township Auditors 'o
the Union Township Board of Supervisors, and copir -d t,,(1
the auditors attorney, Donald Williams. A six cial
meeting of the auditors was held on 3/12/84, to
reconsider the wages of the roadmaster.
Under threat of court action, the auditors set the ;rage
at $7.21 per hour.
'Y'ime and one half to be paid after 48 hours.
Insurance benefits to be paid to roadmaster alone, lot
family, as per the recent ruling by the State Ethics
Commission.
"Although the Supervisors may determine that
roadmasters can be covered by benefits, auditors
would determine if Supervisors acting es
foadmasters may be enrolled in a group life
insurance policy of the township, retirement
system, or other similar benefits."
9. By way cf letter dated January 24, 1984 to Township Luditors
Judy Budai, Norma Hammers, Cathy Schmidt and the Union Township
Board of Supervisors, the Township Solicitor Gabriel Cilli
advised as follows:
Mr. Ralph Nuzzo
Page 5
a. Inquiries had been made of him regarding the
roadmasters compensation.
b. This letter was his opinion on said subject.
c. The auditors must set roadmaster's salary.
d. The auditors must base such salary on similar positions
in the same locality.
10. By way of letter dated January 17, 1985 to Union Township
Secretary /Treasure Susan Currie and the Township Board of
Supervisors the Township Solicitor Gabriel Cilli advised as
follows:
a. His opinion had been requested regarding the receipt of
health insurance benefits by township supervisors.
b. He states that it is quite clear that such benefits are
compensation and must therefore be set by the auditors.
c. The supervisors should discontinue any action on their
own to obtain such benefits. -:
d. Only employee supervisors can receive this benefit.
e. Supervisors who perform only mandated duties such as
road inspectors are not entitled to the benefits.
11. The above noted solicitor opinions were contained in the
Union Township records on file with the township
secretary /treasurer.
12. Union Township records on file with the Township
Secretary /Treasurer contained an "update" from the Pennsylvania
State Association of township supervisors dated March 5, 1984..
a. This update states that the State Ethics Commission
ruled that a non employee supervisor was ineligible
for township hospitalization coverage.
b. The statement indicates that the ruling is being
challenged in court.
c. The statement notes other laws and judicial decisions
on the issue and provides that questions should be
directed to the township solicitors.
Cdr. Ralph Nuzzo
Page 6
13. Township Auditor ,Sally Byler prcvided the following
information regarding this situation:
a. She did not think you were aware that you were enrolled
in the township life insurance program.
b. The auditors did not approve this benefit for you.
c. The auditors never discussed life insurance and were
not aware that they had anything to do with it.
14. Norma Hammers, a former Union Township Auditor provided the
following information regarding this situation:
a. She served as an auditor from 1984 through July 1986.
b. She never approved any insurance benefits for you
because you were not a roadmaster.
c. She believed that roadmasters should receive insurance
benefits.
15. You have stated the following in regard to the township pa5d
life insurance:
a. You were told by someone that you were entitled to
hospitalization and life insurance. All the
supervisors were told this.
b. You had hospitalization through your wife's job at
bank.
c. You were interested in the life insurance, so you went
ahead and enrolled.
You willingly enrolled in the life insurance plan
because you were told that you were entitled to do
so.
You did sign an insurance form to become enrolled.
d. You later found out that you were not entitled to the
life insurance.
e. You were not a paid employee of the township at any
time.
Mr. Ralph Nuzzo
Page 7
f. You believe that the Department of Community Affairs
told the supervisors they could receive either full
hospitalization or life insurance.
In regard to the motion made at the 1/15/85 meeting of
the supervisors in regard to insurance, you stated that
this was meant to state that the auditor's were
responsible for setting the insurance benefits, not the
supervisors's.
g.
h. You agree with the figure of $192.67 which the township
paid to the Trustee's Insurance Fund for life insurance
coverage on your behalf. This included the
reimbursement from Trustee's Insurance fund to the
township.
i. You stated that you were told you were entitled to the
life insurance, and you took advantage of it based on
what you were told.
You thought that you had dropped the insurance before
you left office in December 1985.
You found out at a meeting that you were not entitled
to the insurance, and that is when you dropped it.
B. Discussion: As a former supervisor in Union
were a "public official" subject to the provisions
Act and the restrictions therein are applicable to
§402; Sowers, Opinion 80 -050; Syzmanowski, Order
3(a) of the Ethics Act provides:
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).
Township, you
of the Ethics
you. 65 P.S.
539. Section
Section 3(a) specifically provides in part that a public
official may not use his public office or confidential
Nuzzo
','age 8
information to obtain a gc.in for himself other than compensation
provided for by law. -
The compensation which is allowed for a supervisor is
strictly regulated by statutory and decisional law.
Under Section (a) of the Ethics Act, this Commission hats
previously determined that a township supervisor may not receive
at the township's expense, health, hospitalization, medical ana
life insurance benefits when such supervisor acts only in the
capacity of a supervisor. Kane, Opinion 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 compensation and must, therefore, :3e
fixed as such by the township board of auditors. See Svnoski
Hazle Township, 93 Pa. Commw. 168, 500 A.2d 1282, (1905); In rr:
A..eal of the Auditors Re.ort of Munc Creek Townshi• Pa,
Commw. Ct. , 520 A.2d 1241 (1987); Hunt, Order 348 -R. The
foregoing principle was recently reaffirmed by Pennsylvania
Commonwealth Court in Yocabet v. State Ethics Commission, Pa.
Ccmmw• , 531 A.2d 536 (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 ?9
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 Pe,
kommw. 529, 466 A.2d 283, (1983); Conrad v. Exeter Township, 27 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). Further,.the right to sue
for the restitution of the financial gain obtained in violation
of the Ethics Act has been upheld by Commonwealth Court in Fee v.
Commonwealth of Pennsylvania and Township of Union, filed at 1932
C.D. 1987 on December 1, 1987.
Mr. Ralph Nuzzo
Page 9
In the instant matter, you were a non - working supervisor and
were enrolled in an insurance plan in 1985 which provided group
life insurance. Since you were not a working supervisor, you
could not, under the Second Class Township Code, be legally
entitled to receive the insurance benefits that were paid at
township expense. However, Section 1(c)(2) of House Bill 1577 of
1987, Act 41 of 1988, which was signed into law on March 30,
1988, provides in part: "Any life, health, hospitalization,
medical service or accident insurance coverage contract between
January 1, 1959 and March 31, 1985, that includes or provides
coverage for non - employee supervisors shall not be void or
unlawful solely because such inclusion of non- employee
supervisors was subsequently found to be without lawful
authority. No penalty, assessment, surcharge, forfeiture or
disciplinary action of any kind may occur as a result of
participation by non - employee supervisors."
Since the above quoted provision of law provides amnesty to
a non - employee supervisor regarding insurance received between
January 1, 1959 through March 31, 1985, the Commission finds that
there is no violation of Section 3(a) of the Ethics Act for the
receipt of those benefits for the first three months of 1985
which would be in the amnesty period; however; this Commission
finds that you violated Section 3(a) of the Ethics Act when you
received those benefits at township expense beginning from April
1, 1985 through that year. The gain that you received which is
not covered by the amnesty period amounts to $192.67.
'As a result, this Commission finds that you received
compensation that was not in accordance with that set forth by
law. Generally, the State Ethics Act provides as follows:
The State Ethics Act provides as follows:
Section 9. Penalties.
(a) Any person who violates the provisions of
Section 3(a) and 3(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
Pr. Ralph Nr %-o
6age 10
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).
Additionally, this Commission may make recommenuations to
appropriate law enforcement authorities for the initiatio of
criminal charges or the dismissal of such charges rising oiit r
violations of the State Ethics Act. Prior judicial decis.cn>
have also determined that this Commission may offer an indivioAuti.
who has obtained a financial gain in violation of the law the
opportunity to divest himself of financial gain prior to >.he
issuance of a recommendation to a law enforcement authority.
McCutcheon v. State Ethics Commission, supra; 65 F,.q.
S407(9)(11). In the instant situation, upon a review of all of
the facts, the latter course may be appropriate. Thus, if,h.e
financial gain obtained in violation of the State Ethics Act s
returned to the governmental body from which it is obtained, you
will have removed yourself from a violation of the Act ithout
having received a financial gain. Therefore, you must within
thirty (30) days of the date of this Order forward a check in the
amount of $192.67 to the State Ethics Commission payable zo the
Order of Union Township. If you do not forward said check in
thirty (30) days, this matter will be referred to the app_c ri.ate
law enforcement authority for review and appropriate action.
C. Conclusion and Order:
1. As a Township Supervisor in Union Township, you arm
a "public official" subject to the provisions rf tLe
Ethics Act.
2. There is no violation of Section 3(a) of the Ethics Act
regarding the receipt of group life insurance at
township expense on your behalf as a non - working
supervisor for the period up to March 31, 1985 due to
the applicable amnesty provisions in Act 41 of 1988.
3. You violated Section 3(a) of the Ethics Act when you
received life insurance benefits for the period of April
1, :x.985 through the remainder of 1985 which gain amounts
to $192.67.
4. You are directed to forward a check in the amount of
$192.67 to the State Ethics Commission payable to the
Order of Union Township within 30 days of the date of
this Order.
Mr. Ralph Nuzzo
Page 11
5. Failure to comply with paragraph 4 of this Order will
result in the referral of this matter to the appropriate
law enforcement authority for review and appropriate
action.
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
this Order, 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,
i\kk-LtAcD,
Joseph W. Marshall, III
Chairman
Mr. Ralph Nuzzo
R.D. #8, Box 199
New Castle, PA 16101
Re: Order No. 654, File No. 87 -110 -C
Dear Mr. Nuzzo:
such.
STATE ETHICS COMMISSION
308 FINANCE BUILDING
P.O. BOX 11470
HARRISBURG, PA 17108 -1470
TELEPHONE (717) 783 -1610
July 21, 1988
The State Ethics Commission received your payment for
reimbursing Union Township as required by Order No. 654.
We have forwarded your check in the amount of $192.67 to
Union Township.
JJC /na
This letter will be part of the Order and a public record as
cc: Public Binder
Si
`Conti o
xecutiv Director