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HomeMy WebLinkAbout662 SerovichMr. Joseph L. Serovich 240 East Columbia Avenue Atlas, PA 17851 Re: 87 -068 -C Dear Mr. Serovich: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 ORDER OF THE CG. MISSION ORDER NO. 662 Date Decided: August 18, 1988 Date Mailed: September 13, 1988, 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 Mt. Carmel Township Supervisor, violated the following provision(s) of the State Ethics Act (Act 170 of 1978), when you received compensation not provided for by law in the form of "administrative services pay" from the Township Summer Food Program fund, landfill fund and HUD fund. 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. Code §403(a). A. Findings: 1. You served as a Mt. Carmel Township Supervisor from 1962 until you resigned on August 26, 1985. a. You also served as Chairman and Vice - Chairman at various times. Mr. Josep'a L. ero'T. ". Page 2 :.. Records of Mt. Carmel Township disclose that you received a payment from the township landfill account. ` a. April 5, 1985 $1,000 Check No. 163 b. This check was signed by Supervisors Leonard Corona and Ronald Startzel. c. You endorsed and cashed this check on April 9, 1985. d. Minutes of the April 16, 1985 supervisors' meeting disclosed that under Treasurer's Report, a payment from the Landfill Account in an amount of $1,000 to you for administration costs was listed for approval. You made the motion and subsequently voted to pay this bill. 3. Township records also disclose that in 1984 you received a payment from the Township Sewer Fund. a. Minutes of the December 26, 1984 supervisors' meeting disclose under Treasurer's Report, Sewer Account Disbursement, payment to you in an amount of $1,000 for administrative cost. You seconded the motion and subsequently voted to pay the bills. b. Check No. 15 dated December 26, 198" drawn on the ?`t. Carmel Township Sewer Account payable to you in an amount of $1,000. Check signed by you and supervisor Leonard Corona. c. You endorsed and cashed this check on December 28, 1984. 4. A review of township records disclosed that you did not submit vouchers for the payments you received from the Landfill and Sewer Accounts, 5. Minutes of the Mt. Carmel Township Board of Auditors Reorganization Meetings for the years 1981 through 1987 disclosed that the only compensation approved for the supervisors was the salary for secretary- treasurer and hourly wages for a supervisor acting as superintendent, roadmaster and for working on township roads in any other capacity. a. No wages or compensation was set for administrative duties in regards to the Summer Food program, Sewer, Landfill, or HUD program. b. Auditors who served from 1981 through 1985 advise' :hat the salaries set during that period were mainly applicable to snow removal and road related duties. The salaries set were Mr. Joseph L. Serovich Page 3 not open -ended provisions to do any other township work. There was never compensation set for services performed in the Summer Food Program, Landfill, Sewer or HUD program. They were never aware of a solicitor opinion which stated such payments were legal. 6. Ronald Startzel, former Mt. Carmel Township Supervisor and Board Chairman advised as follows: a. The landfill began to operate sometime around October, 1984. His duties at the landfill included operating a compactor, bookkeeping, billings and also handling problems that the users of the landfill would run into. He worked many Saturdays and many late in the day hours at the landfill. b. In April, 1985, he received a check from the township in the amount of $1,000 for what he considered to be duties that he performed at the landfill during 1984. A few months later, he received a check from the township in the amount of $1,300 for duties he performed at the township during the period January, 1985 to May, 1985. The reason for the closeness of the two payments he received from the landfill fund was because prior to those payments, the landfill fund was broke. Prior to 1985, the township had very little money. c. His duties concerning the sewer fund, required him to attend meetings, to prepare reports concerning the sewage line, to work with members of the Pennsylvania Department of Community Services and an engineering firm, and to prepare invoices for the project. This sewer line was to run from the township to an industrial park. On December 26, 1984, he received a check in the amount of $1,000 from the township sewer fund. At this time, the sewage project was completed and he then submitted an invoice requesting the payment of $1,000. You and Corona also worked on the sewer project and also submitted invoices for checks of $1,000. d. You and Corona submitted requests for payment invoices separately and Startzel never reviewed what work was done to merit the $1,000 payment from the sewage fund. He could not explain why he and the other two former supervisors each received a like amount of $1,000 payment for services. 7. Leonard Corona, former Mt. Carmel Township Supervisor and Secretary /Treasurer, provided the following: Mr. Joseph L. Serovici P ige 4 a. He received a check in April, 1985 for working at the landfill. He started working during October, 1984, on Saturdays, Sundays and weekly after his regular job was completed. He forwarded a voucher to the township prior to being paid. When calendar year 1985 came around the landfill started to make money, and therefore, he and the other supervisors believed it was their time to get paid. He received an additional check for work at the landfill a few months after the initial check. b. He received a check from the Sewer fund in an amount of $1,000 on December 26, 1984. Two local firms, Cardinal Container and Universal Packaging, were having problems disposing of waste, and thus, the township got involved. He did all the administrative and financial work for the Sewer fund, and he and the other supervisors acted as inspectors for sewer lines that were being installed. c. He was under the impression that yearly auditor approval for supervisors' salaries covered any duties the supervisors performed for the township. 8. While in the presence of your attorney, you provided the following information to State Ethics Commission investigators: a. You did not exactly know why you received a $1,000 check from the sewer fund, but you recalled checking worke :s at a construction site on a few occasions.. You received the check from Supervisor Corona who - indicated that Startzel said the payment was legal. You did perform duties over a number of years at the landfill and this was the reason you received a payment in April, 1985 You did not know why you did not receive any payments during previous years. You were never told anything by Startzel or Supervisor Corona as to why the payment was being made in 1985, the matter was never discussed at any public meeting. Startzel told Corona tc make out the checks in amounts of $1,000 for each supervisor. c. Both Startzel and Corona said the payments were legal and indicated that a township solicitor had made a ruling. B. Discussion: Township Supervisors in townships of the second class are public officials as ;;ha;: t. rm is defined in the State Ethics Act. 65 P > S . 5402. As sLch, their conduct must conform to the requirements of t`e tat Ehicr Act. See, Sowers, 80 -050, Szymanowski, Nc Mr. Joseph L. Serovich Page 5 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. Code 5403(a). Within the above provision of law, this Commission has already determined that township supervisors may not approve or accept any compensation for themselves that is not in accordance with the compensation set forth in the Second Class Township Code. This determination has been affirmed by the Commonwealth of Pennsylvania. See McCutcheon v. State Ethics Commission, 77 Pa. Commw. 529, 466 A.2d 283, (1982). Compensation awarded or received by a township supervisor that is not in accordance with the provisions of law could constitute a violation of the above cited Section of the State Ethics Act. The Second Class Township Code provides that township supervisors shall receive the following compensation: Compensation of Supervisors -- Supervisors may receive from the general township fund, as compensation, an amount fixed by ordinance not in excess of the following: Township Population Not more than 4,999 5,000 to 9,999 10,000 to 14,999 15,000 to 24,000 25,000 to 34,000 Annual Maximum Compensation Fifteen hundred dollars Two thousand dollars Twenty -six hundred dollars Thirty -three hundred dollars Thirty -five hundred dollars Such salaries shall be payable monthly or quarterly for the duties imposed by the provisions of this act. The population shall be determined by the latest available official census figures. The compensation of supervisors, when acting as superintendents, roadmasters or laborers, shall be fixed by the township auditors either per hour, per day, per week, semi - monthly or monthly, which compensation shall not exceed compensation paid in the locality for similar services, and such other reasonable compensation for Mr. Josep.1 L. Serovi 1 . rage 6 the use of a passenger car, or a two axle four - wheeled motor truck having a chassis weight of less than two thousand pounds when required and actually used for the transportation of road and grudge laborers and their hand tools and for the distribution of cinders and patching material from a stock pile, as the auditors shall determine and approve; but no supervisor shall receive compensation as a superintendent or roadmaster for any time he spends attending a meeting of supervisors. 65 P.S. S65515, as amended Act 68, 1985. - (Prior to the above amendment, the above provision provided for set fee of $25 per meeting). In reference to the meetings for which supervisors may receive compensation, the code further provides as follows: The township supervisors shall meet for the transaction of business at least once each month, at a time and place to be fixed by the board, but they shall not be paid for more than sixteen meetings in any one year, except in any township where, on account of the exercise of governmental functions other than those relating to roads, more meetings are necessary, in which the supervisors may be paid may be increased to any number, not exceeding fifty meetings in any year which shall include hearings by aggrieved parties under the Pennsylvania Sewage Facilities Act and other hearings by aggrieved parties hearings of a judicial or quasi - judicial nature. Two members of any board of supervisors consisting of three members shall constitute a quorum and three members shall constitute a quorum. Except as otherwise provided in this act, an affirmative vote of a majority of the entire board of any supervisors shall be necessary in order to transact any business. Necessary expenses incurred in such meetings, including office rent, stationery, light and fuel, shall be paid out of the general township fund. 53 P.S. S65512. The duties that a supervisor is responsible for performing are also regulated by statute. As can be seen from the foregoing, the compensation to be paid for a supervisor who is not otherwise employed by the township is strictly regulated by the Second Class Township Code. A supervisor may only receive compensation, as set forth above., for supervisor meetings regarding the transaction of township Mr. Joseph L. Serovich Page 7 business. The type of meeting for which a township supervisor may be compensated must be one at which official township business is transacted. Additionally, the township code provides for compensation at the specific meetings outlined in §65512, above. The code does not appear to permit the compensation of a township supervisor for attending other types of meetings for performing the administrative functions of his office. Any such other compensation must be earned in and as part of the services performed while serving in one of the statutory authorized positions. Thus, if the township supervisors were to award to themselves compensation for attendance at meetings that are not official township meetings of the board of supervisors, or for performing duties not authorized by law, such would violate the provisions of the State Ethics Act as such payment would not constitute compensation provided by law. The above interpretation of the Second Class Township Code is a view that has also been expressed by the State Association of Township Supervisors which specifically indicated the supervisors may not be compensated for meetings with engineers, solicitors, planning commissions, authorities, or recreation boards. See Township News, May, 1985, Page 66. The township code sets forth clearly when supervisors may receive compensation other than as set forth above. Generally, township supervisors may be employed by the township as a roadmaster, laborer, or secretary /treasurer. 53 P.S. §65410. The compensation to be paid to supervisors working in such positions is to be fixed by the township board of auditors. 53 P.S. §65515, 65531; 65540. Township supervisors may not receive any other compensation except as provided above. This concept has been upheld by various courts in the Commonwealth. In Coltar v. Warminster Township, 8 Pa. Commw. Ct. 163, 302 A.2d 859, (1973), the Commonwealth Court of Pennsylvania held that a second class township supervisor may not appoint himself to positions other than those set forth in the township code (roadmaster, laborer, or secretary /treasurer), and receive compensation therefore. See also Conrad v. Exeter Township, 27 D & C 3d 253, (Berks 1 983). It is clear, therefore, that the duties for which a township supervisor may be compensated are strictly regulated by the township code, and when performing in the positions set forth in the code, the supervisor's pay must be specifically set forth by the township board of auditors. The "administrative services" for which you were compensated were related to the office supervisor. You, thus, received compensation that was not part of the compensation provided for by law when you received $1,000 from the township landfill account after you made a motion and voted to approve this payment. You also received compensation not provided in law when you received $1,000 from the township sewer account after you seconded a motion and voted to approve that payment. 'c x. Joseph L. :ovic 'ge 8 It is clear that the auditors did not approve this compensation, even if they had, this Commission has already held that auditors have no authority to fix compensation for township supervisors who are performing duties outside of those fixed by law or for working in positions not established in the township code. Nanovic, 85 -005. What is most disconcerting to this Commission is that you did not submit any vouchers for these payments and hence, it does not appear that you even performed any work at all. You, thus, attempted to use and did use public office to obtain moneys which were not part of your compensation and which were obtained without ever any work on your part. As a result, this Commission finds that you received compensation in the form of administrative pay that was not in accordance with that set forth by law. Generally, 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. 5409(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. 5409(c). The power of this Commission to order restitution or impose a penalty has been sustained by Commonwealth Court. See McCutcheon v. State Ethics Commission, supra; Yocabet v. State Ethics Commission, _ Pa. Commw. Ct. , 531 A.2d 536 (1987). Due to the circumstances of this case, this Commission finds that you must make restitution of your financial gain of $2,000; you are hereby directed to forward, within thirty days, a check to the State Ethics Commission payable to Mt. Carmel Township in the amount of $2,000. Mr. Joseph L. Serovich Page 9 C. Conclusion and Order: 1. As a township supervisor in Mt. Carmel Township, you are a public official and subject to the provisions of the State Ethics Act. 2. You violated Section 3(a) of the State Ethics Act by using public office to obtain a financial gain consisting of compensation which was not provided by law. 3. The amount of gain received by you referenced in paragraph 2 amounts to $2,000. 4. You are hereby ordered to remit to the State Ethics Commission within thirty (30) days of the date of this order, the amount of $2,000 made payable to Mt. Carmel Township. 5. This order will be referred to the appropriate 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, Joseph W. Marshall, III Chairman Mr. Joseph L. Serovich 240 East Columbia Avenue Atlas, PA 17851 Re: Order No. 662, File No. 87 -068 -C Dear Mr. Serovich: On September 20, 1988, the State Ethics Commission received your payment for reimbursing Mt. Carmel Township as required by Order No. 662. We have forwarded your check in the amount of $2,000 to the Mt. Carmel Township. This letter will be part of the Order and a public record as such. JJC /na cc: Public Binder STATE ETHICS COMMISSION 308 FINANCE BUILDING P.O. BOX 11470 HARRISBURG, PA 1 71 08 -1 470 TELEPHONE (717) 783 -1610 September 22, 1988 n J. o xecutjDirector