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HomeMy WebLinkAbout704 BennerMr. Dennis E. Benner R.D. #7 Bethlehem, PA Re: 86 -033 -C Dear Mr. Benner: STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 OR DER OF THE COMMISSION ORDER W. 704 Before: Helena G. Hughes, Chair Robert W. Brown, Vice Chair W. Thomas Andrews G. Sieber Pancoast Dennis C. Harrington James M. Howley DATE DECIDED: June 1, 1989 DATE MAILED: June 8. 1989 The State Ethics Commission received a complaint regarding you and a possible violation of the State Ethics Act, No. 170 of 1978, 65 P.S. 401 et. seq. You were notified in writing as to the commencement of the investigation and as to the specific allegation(s). The investigation has now been completed and a Findings Report was issued to you which constituted the Complaint by the Investigation Division of the State Ethics Commission. An Answer was filed and a hearing was waived. The record is now completed. This Order of the Commission is hereby issued which sets forth the individual allegations, findings, discussion and conclusion as follows: I. Allegation: That you, Councilman for Lower Saucon Township, violated the following provisions of the Ethics Act (Act 170 of 1978), when you voted in favor of a subdivision request made by an individual with whom you engage in joint real estate ventures: 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 Dennis E. Benner Page 2 of his immediate family, or a business with which he is associated. 65 P.S. S403(a). A. Fi.ndinas 1. You served as a member of Lower Saucon Township Council. a. You served from 1983 until your resignation in 1986. 2. You provided information, through your attorney, that you entered into four (4) types of business associations with Verling Wolfe. a. Verling Wolfe moved a home for you for a set fee. b. Verling Wolfe moved homes for you as a partner with another party. c. Verling Wolfe and you purchased 3 homes as a joint venture and he received a set fee for moving these homes. d. You did very limited legal work for Verling Wolfe that involved deed preparation for homes which Verling Wolfe bought, moved and sold on his own account. You did no legal work on the Wolfe property that is the subject of the State Ethics Commission investigation. Mr. Wolfe was the only house mover in the area and was moving homes not only for you but for many other people. Most of the homes moved in the area were moved for Mr. Wolfe's own account. He and his family moved homes and sold them as their livelihood. You have never had any financial interest in Mr. Wolfe's business. 3. On October 9, 1985, Verling H. Wolfe filed with the Lower Saucon Township Planning Commission, an application for a subdivision approval located at Hellertown Road and Wilhelm Road. a. The application was a preliminary plan for a minor subdivision. b. On October 23, 1985, the application of Verling H. Wolfe was forwarded to the Northampton County Conservation District for review. c. On October 28, 1985, the Joint Planning Commission of Lehigh /Northampton Counties advised that the Wolfe subdivision proposal presented no conflict with existing plans or policies. d. On November 11, 1985, Lower Saucon Township recommended that the Wolfe application be denied. Dennis E. Benner Page 3 (1) The basis for this recommendation was that the subdivision would create a substandard lot. 4. Minutes of the December 4, 1985 meeting of the Lower Saucon Township Council reflect that you made a public disclosure that you had a business relationship with Verling Wolfe. You are reported as stating that you had no financial or other involvement with Mr. Wolfe in the matter that was before Council. 5. Minutes of the December 18, 1985 meeting of the Lower Saucon Township Council reflect the following: a. The matter of the Verling Wolfe subdivision application was discussed. b. The Verling Wolfe subdivision application had been carried over from the previous council meeting where the following had occurred: Discussion centered on resubmission of the plan by Wolfe with 30,000 square feet per lot. Discussion occurred as to perk and sand mound testing of the land which was the subject of a subdivision application. Wolfe requested to appear at the December 18, 1985 meeting and the matter was tabled. c. Discussion occurred on the resubmitted plans by Wolfe based on a figure of 31,000 square feet per lot. d. Councilman Gebhart expressed opposition to the resubmitted plan on the basis that it would constitute spot zoning. e. Discussion was held on the issue of your business dealings with Verling Wolfe. A question was raised as to whether you were qualified to vote. f. Solicitor George Hahalis opined that Mr. Benner was qualified to vote. (1) Hahalis indicated that Mr. Benner had no financial interest in the development project. g. Motion by Councilman Chehi to approve the resubmitted plans and grant conditional approval subject to satisfactory D.O.D. for Wilhelm Road. Dennis E. Benner Page 4 (1) Motion carried Danyluk; Nays - on 3 -2 vote. Ayes - Chehi, Benner, Gebhart, Oren. provided the following information in 6. Mr. Verling H. Wolfe relation to this situation: a. He engaged in joint ventures with you after Pennsylvania Department of Transportation which were in the path of new Interstate 78. (1) The joint ventures involved Mr. Wolfe moving houses which you purchased. (2) He preferred that written contracts not be prepared and executed as to these business dealings. b. He entered into a joint venture with you in the fall of 1985 wherein a house of Mr. Campbell was moved from the property he previously owned to a lot on Hickory Hill Road. (1) After the job was completed, expenses were deducted and the profits were shared between you and Wolfe. Another joint venture concerned the purchase by you and Wolfe of a lot on Peachtree Lane. c. he met you at a sale of houses (1) A house was moved onto this lot. (2) The property was listed and eventually sold. d. The most recent joint venture involved the relocation of a house owned by Mr. Becker which was moved to a lot on Sidlerville Road. e. He has moved houses from the Easton to Allentown areas and has used you and other lawyers to prepare deeds, attend settlements and complete the closing paperwork. (1) He paid set fees to you as his attorney. f. Regarding the subdivision plan approved at the December 18, 1985 council meeting, he indicated that he was the sole owner of the house and property. g. He denied that he exerted any influence upon you regarding your vote on his subdivision plan. 7. You provided the following information regarding the statements made by Verling Wolfe. Dennis E. Benner Page 5 a. You met Mr. Wolfe shortly before a PennDot house sale. You had asked PennDot to place you on a bidders list to be advised when homes in the path of I -78 were to be sold for demolition and /or removal. b. Mr. Wolfe and you entered into several transactions. Allcontractual terms and conditions between Mr. Wolfe and you were established at least six (6) months before December 18, 1985. Once a home is purchased and a move decision is made, ground to which the home could be moved had to be secured and overhead powerline estimates secured. Homes could not be moved until PennDot gave a notice to proceed. Sometimes this would take several months. c. Mr. Wolfe is a Mennonite and upon meeting him and his family members, you felt comfortable dealing with Mr. Wolfe on a "hand shake" basis. Mr. Wolfe would tell you his price to move a house and the hourly rate he would charge to get a home operational after the move. For several of the homes Mr. Wolfe and you moved together, you borrowed money. The lending institution required a written agreement between the parties so one was prepared. That agreement permitted either of you to move houses independently of each other and in competition with each other. d. Mr. Wolfe and you entered into a business relationship concerning a home located on Hickory Hill Road. The home was moved to a lot once owned by Mr. Campbell along Cross Lane in the Cherrywood subdivision. The business agreements were made in the Summer of 1985, however, the home could not be moved until sometime in the fall of 1985 because the notice to proceed was not received. e. Mr. Wolfe and you shared risks and profits of that move. At no time did any matter with regard to this home ever come before the Lower Saucon Council. f. A home was purchased in Colesville, Pennsylvania and moved to a lot on Peachtree Lane. All business agreements were made in the Summer of 1985. No matter concerning this home ever came before the Lower Saucon Council. g. All business agreements regarding the Becker home were made in the Summer of 1985. No matters concerning the home owned by Becker came before the Lower Saucon Council. h. You represented Mr. Wolfe in the sale of two (2) homes he had moved from the PennDot right away. In early 1986, Mr. Dennis E. Benner Page 6 Wolfe asked you to represent him a third time in a house sale but you declined since the subject of the sale was the property on which you voted in December, 1985. It was your opinion that you could not receive anything from Mr. Wolfe with respect to that home. 8. George Hahalis, Lower Saucon Township Solicitor, provided the following written declaration: During 1985 and up to the present, I have been solicitor for the Lower Saucon Township Council and in that capacity I attended both the meetings of December 4 and December 18, 1985. At those meetings, the issue of whether Mr. Benner had any business dealings with Mr. Verling H. Wolfe was publicly raised and Mr. Benner made a public statement that he had paid Mr. Wolfe to move several houses for him. I specifically asked Mr. Benner whether he had any pecuniary interest at all in the application which Mr. Wolfe had before the Council or in the property concerned in that application. Mr. Benner publicly responded that he had no such financial interest in that property nor in Mr. Wolfe's overall business. On the basis of that information, I advised him that he could vote on the application at the December 18, 1985 meeting, and following that advice, he did vote. During this period, the Township Council had adopted an unofficial policy to permit the use of substandard lots where a hardship was created by I -78. There were a number of instances where the Council permitted the use of properties which did not otherwise meet minimum lot standards in order to permit the use of lots or houses which were affected by the I -78 construction. Mr. Wolfe's application was one such instance and it was decided in accord with the Council's informal policy. 9. Mr. Raymond LaBuda provided the following information in relation to the instant situation: a. He is an owner of a lot in the Saucon Hills Development. b. Verling Wolfe moved a house you owned to a lot in Saucon Hills in December, 1985. (1) The house was old and in disrepair but area where homes were selling in $120,000.00. (2) Wolfe moved approximately five homes manner. was moved to an the range of for you in this Dennis E. Benner Page 7 (3) You were the only individual who was moving properties that were in the way of Interstate 78. 10. Mr. Thomas E. Rowe gave the following information: a. He is a businessman who purchased three or four homes in Lower Saucon Township. (1) The houses had to be moved because they were condemned and in the path of new Interstate 78. (2) The houses were small in size and worth approximately $2,000.00. b. He was denied approval to move the houses by the township. c. He observed that you, as councilman, were able to obtain township approval to move your houses. 11. You provided the following information regarding statements made by Raymond LaBuda and Thomas Rowe: a. The home referred to by LaBuda was not old and in disrepair. Homes in this area were selling in the range of $120,000.00. This house sold for $120,000.00. b. Wolfe only moved (3) houses for you, not five. c. There were many people moving homes during the I -78 construction. Every house move was separate and independent of the other. You had no interest in homes or land which Mr. Wolfe moved for himself or others including the homes which is the subject of Mr. Wolfe's subdivision application. d. You have no detailed knowledge about Mr. Rowe's transactions except you have heard that he hired Mr. Wolfe to move several homes he purchased in the I -78 corridor. e. Mr. Rowe did move several houses presently located along Sherry Hill Road in Lower Saucon Township. f. You received the same township approval to move homes as every other person did, and no preferential treatment. 12. You supplied the following information: a. You recall voting on the Wolfe subdivision plan. (1) A question arose at the meeting as to whether you could vote. Dennis E. Benner Page 8 (2) Solicitor Hahalis opined that you could vote after you indicated that you had no interest in the subdivision project. (3) You indicated that you voted in favor of the Wolfe subdivision plan because the house was already on.the lot and not to do such would result in hardship. b. You have engaged in three or four joint ventures with Wolfe. (1) The joint ventures involved moving houses. (2) You consider Wolfe as the only reliable house mover in the area. c. You performed legal work for Wolfe but charged him the same fees as you would charge other clients. d. Solicitor George Hahalis has done some legal work for you. (1) You indicate that this occurred after you resigned from council. B. Discussion As a councilman for Lower Saucon Township, you were a "public official," as that term is defined under the Ethics Act. 65 P.S. Section 402; 51 Pa. Code Section 1.1. As such, your conduct is subject to the provisions of the Ethics Act and the restrictions therein are applicable to you. Section 3(a) of the Ethics Act quoted above provides in part that a public official may not use public office to obtain a financial gain for himself other than compensation provided for by law. In the instant matter, the issue is whether you violated Section 3(a) of the Ethics Act when you voted in favor of a subdivision request of Verling H. Wolfe, an individual with whom you engaged in several real estate ventures as to the movement of houses and for wham you provided limited legal services. The houses in question were in the path of the new interstate 78. You purchased these houses and then arranged with Mr. Wolfe, through a joint venture, to move the houses to a new location. Specific instances of your business arrangements involved the movement of a house of a Mr. Campbell to a lot on Hickory Hill Road; the purchase of a lot on Peach Tree Lane and the movement of a house onto that lot, the relocation of a home owned by Mr. Becker to a lot on Sidlerville Road and the movement of other houses from the Easton to Allentown areas wherein your legal services have been utilized by Mr. Wolfe. Your contractual relations were Dennis E. Benner Page 9 established approximately six months prior to the time when Mr. Wolfe filed an application with the Lower Saucon Township Planning Commission for a subdivision approval located at Hellertown and Wilhelm Road. The Planning Commission referred the Wolfe subdivision proposal to the Northampton County Conservation District for review which found no conflict with existing plans or policies. However, the Lower Saucon Township recommended the denial of the application on the basis that it would create a subdivision with a substandard lot. Thereafter, at a December 18, 1985 meeting of the Lower Saucon Township Council, the Wolfe subdivision application, as resubmitted, was discussed. At that meeting, Councilman Gebhart expressed opposition to the resubmitted plan on the basis that it would constitute spot zoning. In addition, the question arose as to whether there would be a conflict of interest on your part in light of the fact that you had a financial relationship with Mr. Wolfe. Solicitor George Hahalis gave his opinion that you were qualified to vote because you had no financial interest in the subdivision plan of Mr. Wolfe. Thereafter, the Wolfe plan was put to a vote which carried by a three -two margin with you in the majority. Mr. Wolfe has indicated that he did not exert any influence upon you regarding the vote; however, Mr. Thomas Rowe, a business man who purchased three or four homes in Lower Saucon Township, indicated that he was denied approval to move his homes by the township although you as councilman were able to obtain township approval to move your houses. After asserting that you received no preferential treatment in receiving township approval to move homes, you indicate that the reason that you voted in favor of the Wolfe's subdivision plan was because the house was already on the lot and that it would result in hardship if he did not receive the approval. You state that you engaged in the joint ventures with Mr. Wolfe because he was the only reliable house mover in the area and lastly that you performed legal work for Mr. Wolfe but charged him the same fees as you would any other client. Although you did have several joint ventures with Mr. Wolfe at the time that he submitted his subdivision plan, the evidence does not establish that you had an interest in the subdivision plan or that you were influenced to vote in favor of the Wolfe application because of your joint ventures with him. Therefore, the evidence is insufficient to establish that you violated Section 3(a) of the Ethics Act when you voted to approve the Wolfe application for a subdivision in Lower Saucon Township. C. Conclusion,: 1. As a member of the Lower Saucon Township Council, you were a public official subject to the provisions of the Ethics Act. 2. The evidence does not establish that you violated Section 3(a) of the Ethics Act when you voted in favor of the subdivision request by a Dennis E. Benner Page 10 Verling Wolfe, an individual with whom you engaged in joint real estate ventures. This Order is final and will be made available as a public document fifteen days after issuance. However, you may request reconsideration which will defer public release of this Order pending action on your request by the Commission. A request for reconsideration, however, does not affect the finality of this Order. A reconsideration request must be received at this Commission within fifteen days of issuance and must include a detailed explanation of your reasons as to why reconsideration should be granted in conformity with 51 Pa. Code S2.38. The files in this case will remain confidential in accordance with Section 8(a) of the Ethics Act, 65 P.S. 408(a) during the fifteen day period and no one, including yourself, unless the right to challenge this Order is waived, may violate confidentiality by releasing, discussing or circulating this Order. However, confidentiality does not preclude you from discussing this case with your attorney at law. Any person who violates 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, 65 P.S. 409(e). By t = Commiss •n, lena G. Hug es Chair