Loading...
HomeMy WebLinkAbout1147 SmithIn Re: Harry Smith STATE ETHICS COMMISSION 308 FINANCE BUILDING HARRISBURG, PENNSYLVANIA 17120 File Docket: X -ref: Date Decided: Date Mailed: Before: Daneen E. Reese, Chair Austin M. Lee, Vice Chair Julius Uehlein Louis W. Fryman John J. Bolger Frank M. Brown 99- 008 -C2 Order No. 1147 1/31/2000 2/11/2000 This is a final adjudication of the State Ethics Commission. Procedurally, the Investigative Division of the State Ethics Commission conducted an investigation regarding a possible violation of the Public Official and Employee Ethics Law, Act 9 of 1989, P.L. 26, 65 P.S. §401 et seq., by the above - named Respondent. At the commencement of its investigation, the Investigative Division served upon Respondent written notice of the specific allegation. Upon completion of its investigation, the Investigative Division issued and served upon Respondent a Findings Report identified as an "Investigative Complaint." An Answer was filed and a hearing was waived. The record is complete. A Consent Agreement was submitted by the parties to the Commission for consideration which was subsequently approved. Effective December 15, 1998, Act 9 of 1989 was replaced by the Public Official and Employee Ethics Act ( "Ethics Act "), Act 93 of 1998, Chapter 11, 65 Pa.C.S. §1101 e seq., which essentially repeats Act 9 of 1989 and provides for the completion of pending matters under that Act. This adjudication of the State Ethics Commission is issued under Act 93 of 1998 and will be made available as a public document thirty days after the mailing date noted above. However, reconsideration may be requested. Any reconsideration request must be received at this Commission within thirty days of the mailing date and must include a detailed explanation of the reasons as to why reconsideration should be granted in conformity with 51 Pa. Code §21.29(b). A request for reconsideration will not affect the finality of this adjudication but will defer its public release pending action on the request by the Commission. The files in this case will remain confidential in accordance with the Ethics Act. Any person who violates confidentiality of the Ethics Act is guilty of a misdemeanor subject to a fine of not more than $ 1,000 or imprisonment for not more than one year. Confidentiality does not preclude discussing this case with an attorney at law. Smith, 99- 008 -C2 Page 2 I. ALLEGATION: That Harry Smith, a public official in his capacity as a Coolbaugh Township Supervisor, violated provisions of the Public Official and Employee Ethics Act ( "Ethics Act"), Act 9 of 1989, Pamphlet Law 26, 65 P.S. §401 et sea., as codified by Act 93 of 1998, Chapter 11, 65 Pa.C.S. §1101 et sea., when he used the authority of his office for the private pecuniary benefit of himself and /or a business with which he is associated when he participated in actions, discussions and decisions of the Coolbaugh Township Supervisors regarding the purchases of fire trucks from the Guardian Fire Equipment Company, a company where he is employed as a sales representative. II. FINDINGS: 1. Harry Smith has served on the Coolbaugh Township Board of Supervisors since 1993. a. Harry Smith has served as the Treasurer of the Board of Supervisors since July 1998. 1. Smith's duties as Treasurer include signing checks for payments of bills. 2. Harry Smith is a Life Member of the Coolbaugh Township Volunteer Fire Company, ( "Fire Company ") or ( "Fire Department) having served since 1957. 3. Harry Smith has been employed as a sales associate for Guardian Fire Equipment, Inc. since 1992. a. Guardian specializes in selling fire trucks and related apparatus. b. Harry Smith's sales territory includes Monroe, Wayne and Pike Counties, Pennsylvania. c. Smith is the sole sales representative for this area. d. Smith's compensation is based on commissions for products sold. 4. Guardian Fire Equipment, Inc., headquartered in Lansdale, PA, is the exclusive dealer for Emergency One fire trucks in Eastern Pennsylvania, which includes Coolbaugh Township, Monroe County. 5. Since at least the summer of 1998, the Coolbaugh Township Fire Department discussed the need for additional fire trucks. a. The Fire Department believed the need existed to acquire two fire trucks due to possible commercial and industrial growth in the area. b. As a member of the Fire Department, Harry Smith was aware of the identified need. c. During this time period, the Fire Department informally discussed financing with the Township Board of Supervisors. 6. The Coolbaugh Township Volunteer Fire Company formed a fire truck selection committee ( "Committee ") to identify types of trucks needed and to develop specifications for two fire trucks to be provided to the Board of Supervisors. Smith, 99- 008 -C2 Page 3 a. Harry Smith was not a member of the Fire Truck Selection Committee, but participated in meetings of the Committee. 7. Harry Smith attended at least three (3) Fire Truck Selection Committee meetings when discussions occurred regarding the purchase of the vehicles. a. Smith was asked to provide information because he was considered the most knowledgeable member of the Fire Company regarding fire trucks. 8. Harry Smith's participation in the Selection Committee meetings including [sic] presenting information regarding specifications, accessories and performance issues for Emergency One fire trucks. a. Harry Smith provided specifications to the Committee for a 50' mid - mount tele -boom fire truck. b. Smith obtained these specifications from his employer, Guardian Fire Equipment. c. The specifications were for a vehicle manufactured by Emergency One and sold through Guardian. d. The specifications of the mid -mount tele -boom were exclusive to Emergency One vehicles. 9. Sometime prior to September 15, 1998, Harry Smith advised his sales manager, Robert Smith at Guardian Fire Equipment, Inc. of Coolbaugh Township's desire to purchase two (2) new fire trucks. a. Harry Smith requested that Robert Smith send the specifications for an Emergency One 50' mid -mount tele -boom fire truck to the Coolbaugh Township Volunteer Fire Company for review. b. The mid -mount tele -boom is an exclusive feature of Emergency One. 10. Robert Smith met with Fire Department and Township officials on four occasions between April 21, 1998 and November 3, 1998. a. Robert Smith made presentations after Harry Smith provided the Emergency One specifications to the Committee. 11. The specifications provided by Harry Smith were the basis of the specifications approved by the Fire [Truck] Selection Committee. a. The specifications approved by the Fire [Truck] Selection Committee were specifically designed for Emergency One equipment. b. The specifications were prepared by Robert Smith, Harry Smith's sales manager. 12. It is a common practice when a fire department wants to purchase a particular type of fire equipment apparatus to have that manufacturer prepare the specifications. a. The specifications can then be prepared to favor the particular manufacturer and eliminate other bidders. Smith, 99- 008 -C2 Page 4 13. Harry Smith did not contact any additional fire truck manufacturers to inform them of Coolbaugh Township's interests in purchasing two (2) new fire trucks. a. Smith did not obtain truck specifications from other manufacturers for the Committee to review. 14. In the fall of 1998, prior to the bid announcement by Coolbaugh Township, Harry Smith contacted Bangor Township Fire Chief Larry Lobe to coordinate a demonstration of that department's Emergency One 95' aerial platform in Coolbaugh Township. a. Bangor Township Fire Company brought their 95' Emergency One aerial platform fire truck to Coolbaugh Township in 1998 prior to any decisions being made as to they [sic] types of trucks to purchase. b. Harry Smith was present with other members of Coolbaugh Township Volunteer Fire Company during the demonstration. c. Harry Smith was the only Guardian Fire Equipment, Inc. sales representative present during the demonstration. 15. This presentation resulted in the Committee selecting the 95' aerial platform as the second fire truck to be purchased. 16. Prior to September 1998, the Board of Supervisors and the Volunteer Fire Department discussed the purchase of two new fire trucks. a. Discussions resulted in targeting for [the] purchase of a 50' mid -mount tele -boom fire truck and a rear mount aerial platform truck. 1. Harry Smith, in his capacity as a Township Supervisor, participated in discussions with the Fire Department leading to this type of vehicle being recommended to the Board of Supervisors. 2. No specific manufacturer was indicated during those discussions. 3. The specifications presented to the Supervisors were exclusive to Emergency One. a. The Board was unaware that the specifications were exclusive to Harry Smith's company. 17. At the September 14, 1998 Coolbaugh Township Board of Supervisors meeting, Harry Smith made the motion to pay for the cost of the advertisement of the Township's Volunteer Fire Company bid for new fire trucks and to authorize the Township Secretary to advertise the bid. This motion carried 4 -0 with Harry Smith participating. a. The specifications were delivered to the Board by Harry Smith. b. Smith advised the Township Secretary [that] it was appropriate to advertise only in the local newspaper, the Pocono Record. 1. The Board of Supervisors was interested in obtaining a number of quotes. Smith, 99- 008 -C2 Page 5 2. Advertising locally would limit the number of quotes to vendors with access to the Pocono Record. 18. Advertisements for new fire trucks appeared in [the] Pocono Record on October 17, 1998 and October 21, 1998. a. The Pocono Record is a local newspaper serving the Pocono Mountain area of Northeastern Pennsylvania. b. Bids were being accepted until October 30, 1998 for a Custom Chassis Aerial Platform and a 50' Mid -Mount Commercial Chassis Boom. c. Detailed specifications were listed as being available at the Coolbaugh Township Municipal Center. d. Bruce Henry, Assistant Fire Chief for the Coolbaugh Township Volunteer Fire Company, was identified as the contact person. 19. Harry Smith acted as Guardian's liaison with the Township and the Fire Department during the process of developing specifications for the fire truck purchase. a. Smith performed this function at the direction of Guardian Management. 20. After the specifications were developed and prior to the trucks being advertised, Harry Smith advised [the] Fire Truck Selection Committee members and the Board of Supervisors that he had reviewed the specifications. a. Questions had been raised whether the specifications developed by Guardian would enable other companies to bid. b. Harry Smith advised Fire Company members and the Supervisors that the specifications submitted by Guardian Fire Equipment, Inc., were generic and fairly written to encourage bids from all manufacturers. c. In reality, the specifications were exclusive to the equipment sold by Guardian. d. Smith was asked by one Supervisor whether quotes would be obtained from American LaFrance, a manufacturer of fire equipment. 1. Smith advised the Supervisor that American LaFrance was no longer in business. 2. American LaFrance continues to make sales of fire trucks. e. Smith did not advise the Board of Supervisors that he had participated in the request for and the delivery of the specifications to the Fire Department or that he had chosen the specifications. 21. The Board of Supervisors relied on Harry Smith's input because of his expertise with Emergency One trucks. 22. The specifications approved were identical to the specifications obtained by Harry Smith from Guardian. Smith, 99- 008 -C2 Page 6 23. The specifications, as advertised, eliminated all bidders except those dealing in Emergency One equipment. a. The only company authorized to sell Emergency One equipment to Coolbaugh Township was Harry Smith's employer, Guardian Fire Equipment. 24. Emergency One is the only fire truck manufacturer which produces fire trucks with the following specifications required by Coolbaugh Township: a. 50' Mid -mount tele -boom b. 95 foot aerial platform c. Structural safety and stability factor of 2 1 /2 to 1 1. NFPA requirement is 2 to 1 ratio, which other manufacturers follow. d. Maximum operator spread of 13' 8" on the outrigger system 1. Other manufacturers' maximum spread exceeds 13' 8 ". e. The 95' platform specification requiring aluminum aerial ladders f. Rear mount aerial windows requiring worm gear drive g. Torque box integral part of chassis frame 25. Although Emergency One manufacturers [sic] a 50' rear -mount tele -boom similar to other fire truck manufacturers, Harry Smith provided specifications for a 50' mid -mount tele -boom, which is exclusive to the Emergency One equipment sold by his employer, Guardian Fire Equipment. 26. The specifications, as presented by Harry Smith, contained "no exception[s]" clauses for both the 50' mid -mount tele -boom and the 95' rear -mount aerial platform. a. No other fire equipment apparatus manufacturers could meet these specifications. 27. The 50' mid -mount tele -boom safe load limits specifications contained a "no exceptions" clause for ladder load ratings which are unique to the Emergency One equipment sold by Guardian. Safe Load Limits: The ladder shall have the following load ratings established in the unsupported fully extended configuration and maintain a minimum 2.5 to 1 safety factor on yield strength on materials. The weight rating of each person shall be 250 lbs. All loads assume 50 additional pounds of equipment at the tip. A 2 to 1 stability factor shall be maintained during the following conditions. Condition #1. Tip load only, no water flowing. Smith, 99- 008 -C2 Page 7 Elevation Capacity Pounds - 10 to 30 degrees 1 person 250# 30 to 45 degrees 2 people 500# 45 to 85 degrees 3 people 750# Condition #2. Distributed loads no water flowing. These ratings include one person at the ladder tip. Elevation Capacity Pounds - 10 to 45 degrees 3 people 750# 45 to 85 degrees 6 people 1500# Condition #3. Ladder tip load while flowing 1000 GPM. Elevation Capacity Pounds - 10 to 45 degrees None 0 45 to 85 degrees 1 person 250# 28. The ladder certification for the 50' mid -mount tele -boom also contained a "no exceptions" clause for specifications unique to Emergency One equipment sold by Harry Smith's employer. a. A minimum of 2.5 to 1 structural safety factor based on the yield strength of the material. This safety factor shall include 2.5 times the dead weight of the aerial, combined with a 2.5 to 1 live Toad safety factor and shall be applicable to all components used in the construction of the aerial device, including all substructure and jack components. 29. The specifications for the rear -mount aerial platform contained a "no exceptions" clause for ladder certification identical to those for the mid -mount tele -boom. 30. At least two other companies, Pierce and American LaFrance (LTI), who specialize in fire truck sales did not bid because of the way the specifications were written to include the no exceptions clauses. 31. On October 2, 1998, two weeks prior to the specifications being approved by the Board of Supervisors and advertisements appearing in the newspapers, Robert Smith requested pricing from Emergency One for the 50' mid -mount tele- boom truck. a. Robert Smith requested pricing on specifications identical to those [which] Harry Smith provided to the Township Fire Truck Selection Committee. b. Robert Smith knew what specifications to price prior to the advertisements based on his information that the Committee had reviewed only Emergency One specifications. 32. At the November 3, 1998 Board of Supervisors meeting, it was announced that one (1) bid was received for the custom chassis aerial platform and the 50' mid - mount commercial chassis boom from Guardian Fire Equipment. a. No decision was made by the Board to award the contract. Smith, 99- 008 -C2 Page 8 b. The Supervisors sent the bid material to the Fire Company for review and recommendation. 33. Guardian Fire Equipment, Inc.'s bid for the custom chassis aerial platform and the 50' mid -mount commercial chassis boom included the following: a. One (1) 1999 Emergency One 95' aerial platform for $576,448.00 b. One (1) 1999 Emergency One commercial chassis 50' mid -mount boom for $309,777.00 c. Total bid price for both pieces of equipment was $886,225. 34. The Guardian bid was sent by the Board of Supervisors to the Coolbaugh Township Volunteer Fire Company for review and recommendation on November 3, 1998. 35. On November 17, 1998, the Board of Supervisors voted unanimously to table approval of bids for the fire truck purchase. a. The matter was tabled pending review by the Fire Department. b. Harry Smith was present and participated in the action. 36. Guardian Fire Equipment, Inc. was awarded the bid for the 1999 Emergency One 95' aerial platform and the 1999 Emergency One commercial chassis 50' mid -mount boom at the December 1, 1998 Board of Supervisors meeting. a. The motion carried 4 -0 -1; Harry Smith abstained from voting. b. A motion was also approved to pay for the two (2) fire trucks over a ten year lease purchase agreement. c. That motion carried 4 -0 -1 with Harry Smith abstaining from voting. d. Smith did not provide a reason for either of the abstentions. 37. A sales agreement between Coolbaugh Township and Guardian Fire Equipment, Inc. for the purchase of two (2) new fire trucks was signed by Coolbaugh Township Supervisor James Frutchey and Guardian Fire Equipment, Inc. representative Robert Smith on December 8, 1998. a. The agreement was signed by James Frutchey in his capacity as Chairman of the Board of Supervisors. 38. On December 8, 1998, Coolbaugh Township issued a $200,000.00 non- refundable deposit check to Guardian Fire Equipment, Inc. for the purchase of two (2) new fire trucks. a. Check number 106 from the PLGIT /ARM Coolbaugh Township Emergency Services account was endorsed by James Frutchey, Chairman and Harry Smith, Treasurer on December 7, 1998. b. The payment was issued prior to the Board of Supervisors vote on December 15, 1998. Smith, 99- 008 -C2 Page 9 1. Smith participated in approving this payment. 39. The payment made on December 8, 1998 was contrary to policy adopted on December 16, 1997 on the motion of Harry Smith requiring that no payments be made prior to a vote of the Board. 40. On December 23, 1998, Coolbaugh Township Secretary Linda Frutchey advised Robert Smith [of] Guardian Fire Equipment that Guardian Fire Equipment was awarded the bid for the two fire trucks totaling $886,225.00. a. Attached to the 12/23/98 letter was Township purchase order number 285 for the two vehicles. 41. Robert Smith, Guardian Fire Equipment sales manager, was aware that Guardian would be awarded the contracts for the fire trucks prior to the official action of the Board. a. Smith was aware of the time frame when the sales contract would be signed and when the order would be placed. 42. On November 18, 1998, Robert Smith advised Paul Stephenson, Aerial Product Manager for Emergency One, that Guardian was awarded the bid on both trucks, that contracts would be signed the first week of December, and [that] the order would be down shortly thereafter. a. This information was provided by Robert Smith fourteen (14) days prior to the Board of Supervisors making a decision to award the contract. b. A sales contract was signed between the Township and Guardian during the first week of December 1998. 43. This information was not available to the public prior to December 1, 1998. 44. On November 23, 1998, Robert Smith prepared Factory Discount Authorization forms for both fire trucks, which were submitted to Emergency One, which contained the following information: 95' Rear Mount Tele -Boom 50' Mid -Mount Total E -One Net: Dealer Equipment: Delivery: Dealer Commission: Total Bid Price: Factor[y] Discount Adjusted Bid Price: Total Time on Deal: Specs: $501,148.00 $ 39,500.00 $ 4,800.00 $ 30,000.00 $624,448.00 < $ 48,000.00> $576,448.00 6 Months 100% E -One $270,977.00 $ 15,000.00 $ 3,800.00 $ 20,000.00 $337,779.00 < $ 32,762.00> $309,777.00 6 Months 100% E -One 45. The Factory Discount Authorization form submitted by Robert Smith to Emergency One noted [that] the customers (Coolbaugh Township) wanted Emergency One trucks but [that the trucks] must be under their budget. Smith, 99- 008 -C2 Page 10 a. Smith also noted as a reason for the discount was that both fire trucks were 100% Emergency One specifications. 46. On January 19, 1999, the Coolbaugh Township Supervisors approved a ten year fire service contract with the Coolbaugh Township Fire Company. a. The motion was made by Harry Smith and approved by a 4 to 0 vote. 47. The ten year agreement covering the period from 1999 through the year 2008 provided for annual payments from the Township to the Fire Department as follows, including payments for the new fire trucks: a. On or before August 15 of each of the years in the term of this contract the amount of $20,000.00 will be paid into the Township's Emergency Services Fund as repayment for the 1998 compensation from the Emergency Services Fund; and b. During each month of the term of this contract the amount of $6,586.71 will be paid to Guardian Fire Equipment for the 1999 Emergency One 50' Boom and 95' Platform Truck. The total annual amount of such monthly payments is $79,040.52; and c. The balance of the compensation for each year, as set forth above, (the annual amount Tess the payments to the Emergency Services and General Funds) shall be paid directly to the Company in the amount of $80,000.00. 48. Guardian Fire Equipment realized a profit of at least $60,000.00 for the sale of the two fire trucks to Coolbaugh Township. a. 95' Rear -mount $40,000.00 Dealer Commission b. 50' Mid -mount $20,000.00 Total $60,000.00 49. Guardian's commission policy for sales of fire trucks is 25% of the profit received by the company. a. A commission of $15,000 would be paid for the sale to Coolbaugh Township based on $60,000 profit. b. Commissions are paid after delivery of the fire trucks to the municipality. 50. Records of sales of fire trucks and apparatus by Harry Smith maintained by Guardian confirm the following in regards to equipment sold and earnings. Year Trucks Sold 1994 Eagle McClure Rosetto 1995 Fogelsville Plains 1996 W -2 $ 6,890.00 $14,646.00 $ 745.00 Smith, 99- 008 -C2 Page 11 1997 1998 1999 III. DISCUSSION: Pocono Summitt West Pittston Covington Bangor Coolbaugh Coolbaugh Section 1103. Restricted activities. $ 9,000.00 $ 0.00 51. These documents reflect Harry Smith being credited for the sale of two fire trucks to Coolbaugh Township in 1999. a. Earnings for all 1999 sales are not depicted. 52. Commissions were not paid by Guardian for the Coolbaugh Township truck purchases as of August 1, 1999. a. Robert Smith was to receive a fee of $6,000.00 for his role in the sale. 53. The private pecuniary benefit to Guardian Fire Equipment Company, Harry Smith's employer, as a result of the sales of the fire trucks to the Township totaled $60,000.00. At all times relevant to this matter, the Respondent, Harry Smith ( "Smith ") has been a public official subject to the provisions of the Public Official and Employee Ethics Act ( "Ethics Act "), Act 9 of 1989, as codified by Act 93 of 1998, 65 Pa.C.S. §1101,e semc. The issue is whether Smith violated Section 1 103(a) of the Ethics Act regarding the allegation that he used the authority of his office for the private pecuniary benefit of himself or a business with which he is associated when he participated in actions, discussions and decisions of the Coolbaugh Township Board of Supervisors regarding the purchases of fire trucks from Guardian Fire Equipment, Inc., a company where he is employed as a sales representative. (a) Conflict of interest. - -No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. §1103(a). The term "conflict of interest" is defined under the Ethics Act as follows: Section 1102. Definitions. "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member Smith, 99- 008 -C2 Page 12 of his immediate family is associated. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 Pa.C.S. §1102. Section 1 103(a) of the Ethics Act prohibits a public official /public employee from using the authority of public office /employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official /public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Having noted the issues and applicable law, we shall now summarize the relevant facts. Smith has served on the Coolbaugh Township Board of Supervisors ( "Board ") since 1993. Smith has been a member of the Coolbaugh Township Volunteer Fire Company ( "Fire Company ") since 1957. Smith has also been employed by Guardian Fire Equipment, Inc. ( "Guardian ") since 1992, where he specializes in selling fire trucks and related apparatus on a commission basis. Since approximately 1998, the Fire Company discussed the need to acquire two new fire trucks due to possible commercial and industrial growth. Financing for the trucks was informally discussed with the Board. As a member of the Fire Company, Smith was aware that the Fire Company needed additional trucks. The Fire Company formed a Fire Truck Selection Committee ( "Committee ") to identify what types of trucks it needed to purchase and to develop specifications for two fire trucks for submission to the Board. Smith was not a member of the Committee, but was asked to provide information regarding fire trucks because he was considered the most knowledgeable member of the Fire Company. Smith's participation in Committee meetings included providing specifications to the Committee for a 50' mid -mount tele -boom fire truck, which specifications could only be met by one fire truck manufacturer, Emergency One. At the direction of Guardian management, Smith acted as Guardian's liaison with the Township and the Fire Company during the process of developing specifications for the fire truck purchase. Between April 21, 1998 and November 3, 1998, Guardian's sales manager met with Fire Company and Township officials on four occasions to make presentations relating to the fire truck purchase. The specifications that were eventually approved by the Committee were based upon the specifications that were provided to the Fire Company. Smith did not inform any other fire truck manufacturer that Coolbaugh Township wished to purchase two new fire trucks or obtain truck specifications from any other manufacturer for the Committee to review. Prior to September of 1998, the Board and the Fire Company discussed purchasing two new fire trucks, a 50' mid -mount tele -boom truck and a rear mount aerial platform truck. Smith, in his capacity as a Township Supervisor, participated in discussions with the Fire Company which eventually lead to a recommendation to the Board to purchase that particular type of vehicle. Smith, 99- 008 -C2 Page 13 In the fall of 1998, prior to Coolbaugh Township's bid announcement, Smith contacted the Bangor Township Fire Chief to coordinate a demonstration of the Bangor Township Fire Department's Emergency One 95' aerial platform. The demonstration took place before Coolbaugh Township made any decision as to the types of trucks to purchase. Smith and other members of the Fire Company were present during the demonstration but Smith was the only Guardian sales representative there that day. At the conclusion of the demonstration, the Committee decided to purchase a 95' aerial platform as its second fire truck. After the specifications were developed and prior to the bid advertisement, Smith advised the Committee and the Board that he had reviewed the specifications for a 50' mid -mount tele -boom fire truck. No specific manufacturer was discussed and the Board was unaware that Emergency One was the only company that manufactured a tele -boom truck meeting those specifications. The Board was also unaware that Guardian was the exclusive dealer of Emergency One fire trucks. Questions arose as to whether the specifications would enable other companies to bid. Smith advised the Fire Company and the Board that the specifications submitted by Guardian were generic and fairly written to encourage bids from all manufacturers. One supervisor asked Smith whether quotes would be obtained from American LaFrance, another fire equipment manufacturer. Smith told the supervisor that American LaFrance was no longer in business when in fact that company was still selling fire trucks. The Board relied on Smith's input because of his expertise with Emergency One trucks. Smith did not advise the Board that he had participated in the request for and the delivery of the specifications to the Fire Company or that he had chosen the specifications. The specifications that were approved by the Board were identical to the specifications that Smith obtained from Guardian. Although the Board wanted to obtain a number of quotes, Smith advised the Township Secretary that she should only advertise in the local newspaper serving the Pocono Mountain area of Northeastern Pennsylvania, the Pocono Record. Advertising locally would limit the number of quotes to vendors with access to the Pocono Record. On October 2, 1998, two weeks before the Board approved the specifications and advertised the bid, Guardian's sales manager requested a price quote from Emergency One for the 50' mid -mount tele -boom fire truck in the exact amount that Smith had quoted to the Committee; he knew that the Committee had only reviewed specifications unique to Emergency One fire trucks and hence he knew what specifications to price. Advertisements for a Custom Chassis Aerial Platform and a 50' Mid -Mount Commercial Chassis Boom appeared in the Pocono Record on October 17, 1998 and October 21, 1998. The specifications contained several "no exceptions clauses" for both the 50' mid -mount tele -boom and the 95' rear -mount aerial platform. No other fire equipment apparatus manufacturer could meet those specifications. On November 3, 1998, the Board announced that it had received one bid from Guardian, for a custom chassis aerial platform and a 50' mid -mount commercial chassis boom, totaling $886,225.00. The Board did not make a decision to award the contract, but sent Guardian's bid to the Fire Company for review and recommendation. On November 17, 1998, the Board voted unanimously to table approval of the bid pending review by the Fire Company. Smith was present at the November 17, 1998 Board meeting and participated in that vote. Prior to any official Board action, Guardian's sales manager knew that the Township would award the fire truck contracts to Guardian as well as when the sales Smith, 99- 008 -C2 Page 14 contract would be signed and when the order would be placed. On November 18, 1998, fourteen days before the Board awarded the contracts, the Product Manager for Emergency One was advised that Guardian had been awarded the bid for both trucks, that contracts would be signed during the first week of December, and that the order would be placed shortly thereafter. This information was not available to the public prior to December 1, 1998. On December 1, 1998, the Board awarded the bid to Guardian by a vote of 4 -0- 1. The Board also approved a motion to pay for the two fire trucks through a ten year lease purchase agreement by a vote of 4 -0 -1. Smith abstained from voting in both Board actions but did not disclose the reason for his abstentions. On December 8, 1998, the Chairman of the Board Supervisors entered into a sales agreement for the purchase of the two fire trucks. On that same day, the Township issued a $200,000.00 non - refundable deposit check to Guardian which was endorsed by the Board Chairman and Smith as Treasurer. The $200,000.00 check was issued to Guardian before Smith and the other Board Members voted to approve the payment on December 15, 1998. The payment was contrary to Board policy that no payment be made prior to a vote of approval by the Board. On January 19, 1999, Smith made a motion to approve a ten -year fire service contract with the Fire Company. The motion passed by a vote of 4 -0. As a result of the sale of the two fire trucks to the Township, Guardian realized a profit of at least $60,000.00. The records do not reveal Smith's earnings for 1999 because as of August 1, 1999, Smith had not received his commission of $6,000.00 for the sale of the fire trucks to the Township. Having summarized the above relevant facts, we must now determine whether the actions of Smith violated Section 1103(a) of the Ethics Act. The parties have submitted a Consent Agreement together with a Stipulation of Findings wherein it is proposed to resolve the case by finding a violation of Section 1103(a) of the Ethics Act when Smith as a member of the Board of Supervisors participated in actions, discussions and decisions of the Board regarding the purchase of fire trucks from his employer, Guardian Fire Equipment Company, Inc; and by Smith agreeing to pay $5,000.00 within 30 days of the issuance of this Order through this Commission to the Commonwealth of Pennsylvania. As to Section 1 103(a) of the Ethics Act, Smith used the authority of his position as a member of the Board of Supervisors to facilitate the Township's purchase of fire equipment from his employer, Guardian. In particular, Smith used the authority of office as a Supervisor in controlling events to ensure that Guardian would be awarded the contract for the two fire trucks. But for the fact that Smith was a Supervisor, he could not have limited the specifications so that only Emergency One fire trucks, of which Guardian is the exclusive dealer, could meet the bid specifications. Smith directed that the advertisement for bids be limited to a local newspaper. Through such action, only one bid was received - from Smith's employer, Guardian. Such actions were uses of authority of office. See, Juliante, Order 809. Such uses of authority of office resulted in a private pecuniary benefit consisting of the $60,000.00 profit to Guardian and the $6,000 sales commission to Smith himself. Finally, these private pecuniary benefits inured to Smith himself as well as to Guardian which is a business with which Smith is associated. Accordingly, Smith violated Section 1103(a) of the Ethics Act when he used the authority of his office for the benefit of himself or a Smith, 99- 008 -C2 Page 15 business with which he is associated by facilitating the sale of fire equipment from Guardian Fire Equipment, his employer. As per the Consent Agreement, Smith is directed to make payment of $5,000 as per the terms noted above. Compliance with the foregoing will result in the closing of this case with no further action. Noncompliance will result in the institution of an order enforcement action. Lastly, as to the Stipulation of Findings and Consent Agreement we believe that the Consent Agreement is the proper disposition for this case based upon our review as reflected in the above analysis and the totality of the facts and circumstances. IV. CONCLUSIONS OF LAW: 1. Harry Smith, as a Supervisor in Coolbaugh Township, is a public Official subject to the provisions of Act 9 of 1989 as codified by Act 93 of 1998, Chapter 11. 2. Smith violated Section 1103(a) of the Ethics Act when he used the authority of his office for the benefit of himself or a business with which he is associated by facilitating the sale of fire equipment from Guardian Fire Equipment, his employer. In Re: Harry Smith ORDER NO. 1147 File Docket: 99- 008 -C2 Date Decided: 1/31/2000 Date Mailed: 2/11/2000 1. Harry Smith, as a Supervisor in Coolbaugh Township, violated Section 1103(a) of the Ethics Act when he used the authority of his office for the benefit of himself or a business with which he is associated by facilitating the sale of fire equipment from Guardian Fire Equipment, his employer to the township. 2. Per the Consent Agreement of the parties, Smith is directed to pay $5,000 within 30 days of the issuance of this Order through this Commission to the Commonwealth of Pennsylvania. a. Compliance with the foregoing will result in the closing of this case with no further action by the Commission. b. Non- compliance will result in the institution of an order enforcement action. BY THE COMMISSION, DANEEN E. REESE, CHAIR