HomeMy WebLinkAbout1176 HellerIn Re: John Heller
File Docket:
X -ref:
Date Decided:
Date Mailed:
Before: Daneen E. Reese, Chair
John J. Bolger
Frank M. Brown
Susan Mosites Bicket
99- 021 -C2
Order No. 1176
12/12/00
12/27/00
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, as codified by Act 93 of 1998, by the above -named Respondent. At
the commencement of its investigation, the Investigative Division served upon Respondent
written notice of the specific allegation(s). 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 held. The record is
complete.
Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter
11, Act 93 of 1998, which essentially repeats Act 9 of 1989 and provides for the completion
of pending matters under Act 93 of 1998.
This adjudication of the State Ethics Commission is issued under Act 9 of 1989 as
codified by 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 under Act 9 of 1989 as
codified by Act 93 of 1998. Any person who violates confidentiality of the Ethics Law 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.
Heller, 99- 021 -C2
Page 2
I. ALLEGATION: That John Heller, a public official in his capacity as a
Supervisor for Tunkhannock Township, violated Sections 3(a)/1103(a) and 3(f)/1103(f) of
the State Ethics Act (Act 9 of 1989 as codified by Act 93 of 1998) when he used the
authority of his office for the private pecuniary benefit of himself and /or a business with
which he is associated by participating in actions and decisions to award J. E. Heller
Excavating & Hauling contracts by the township; when he over billed the township for work
performed and subsequently participated in actions to approve payments; and when the
contracts entered into by J. E. Heller Excavating & Hauling with the township were entered
into without an open and public process.
II. FINDINGS:
A. Pleadings
1. On May 4, 1999, a letter was forwarded to John Heller, by the Executive
Director of the State Ethics Commission informing him that a complaint
against him was received by the Investigative Division and that a full
investigation was being commenced.
a. Said letter was forwarded by certified mail, no. Z 377 194 606.
b. The domestic return receipt bore the signature of Mrs. John Heller,
with a delivery date of May 5, 1999.
2. John Heller has served as a Supervisor of Tunkhannock Township, Monroe
County, from January 1994 until resigning on June 19, 1999.
a. Heller served as Assistant Roadmaster in 1996 and Roadmaster in
1997.
3. John Heller filed Statements of Financial Interests (SFI) forms for the 1995-
1997 calendar years with Tunkhannock Township.
a. John Heller listed J. E. Heller Excavating and Hauling, Inc, as a direct
or indirect source of income on his 1995 -1997 SFI forms.
4. On or about January 7, 1996, Pennsylvania received large amounts of snow
fall which resulted in the Commonwealth of Pennsylvania declaring a "state
of emergency."
a. A second storm occurred from January 11, 1996, through January 13,
1996.
b. Tunkhannock Township, Monroe County, was one of the areas
affected by these storms.
5. The township's main snow plowing vehicle, a 1985 Ford F800, was
inoperable at the time of the blizzard and unable to be used.
a. The township used the services of private companies to
remove snow caused by the storm and the subsequent blowing
and drifting of snow.
6. Tunkhannock Township hired J. E. Heller Excavating and Hauling, Inc., to
perform emergency snow plowing and removal during the state of
emergency conditions.
Heller, 99- 021 -C2
Page 3
7. The decision to use private companies was not made during a board of
supervisors' meeting.
a. Township Roadmaster and Chairman of the Board of Supervisors
Thomas Delese made the decision on which firms to select.
b. Bids were not solicited due to the emergency nature of the storm.
8. Heller Excavating performed snow removal services for the township on
January 8, 1996, and January 9, 1996.
a. Heller Excavating utilized a Mack Truck with plow and John Deere
tractor with loader for the removal.
b. John Heller was the equipment operator.
9. Prior to 1996 no work was performed by Heller Excavating for Tunkhannock
Township.
10. John Heller prepared hand written time sheets of his billable hours for the
snow plowing and snow removal for January 8 -9, 1996, for Tunkhannock
Township.
a. John Heller recorded ten hours of tractor /loader use for snow removal
and ten hours of truck/plow use for snow plowing on the January 8,
1996, time sheet.
b. John Heller recorded ten hours of tractor /loader use for snow removal
and ten hours of truck/plow use for snow plowing on the January 9,
1996, time sheet.
11. John Heller forwarded the completed time sheets for January 8 & 9, 1996, to
his wife, Julia Heller, for billing purposes.
a. Julia Heller is the secretary /treasurer for J. E. Heller Excavating &
Hauling, Inc.
b. Julia Heller prepared a billable invoice for the emergency snow
plowing and snow removal from John Heller's January 8 -9, 1996,
handwritten time sheets.
12. The billable invoice prepared by Julia Heller indicated twenty -eight (28)
hours of truck and plow services were used for snow plowing and ten (10)
hours of tractor /backhoe services were used for snow removal.
a. Twenty -eight (28) hours of plow service was billed at $55 /per hour,
totaling $1,540.00.
b. Ten (10) hours of backhoe service was billed at $65 /hour, totaling
$500.00.
1. Ten hours of backhoe use at $65 /hour totals $650.00, but the
township was billed $500.00 for the ten (10) hours of service.
c. The total billable invoice for the thirty -eight (38) hours of service was
$2,040.00.
Heller, 99- 021 -C2
Page 4
1. The total bill should have been $2,190.00 based on ten (10)
hours backhoe at $65 /hour ($650.00) and twenty -eight (28)
hours plow service at $55 /hour ($1,540.00)
13. Julia Heller submitted the finalized billable invoice for $2,040.00 to
Tunkhannock Township Supervisor /Roadmaster Thomas Delese for
payment on or about January 9, 1996.
14. Sometime between January 9, 1996, and January 26, 1996, Julia Heller
discussed the Heller Excavating invoice with Thomas Delese, Chairman of
the Board of Supervisors.
a. The meeting occurred at the Heller residence.
15. The revised invoice prepared by Julia Heller and submitted to Tunkhannock
Township indicated thirty -eight (38) hours of truck and plow services were
used for plowing and thirty (30) hours of tractor /backhoe services were used
for snow removal.
a. Thirty -eight (38) hours of plow service was billed at $55 /hour, totaling
$2,090.00.
b. Thirty hours of backhoe service was billed at $65 /hour, totaling
$1,950.00.
c. The total revised bill for the sixty -eight (68) hours of service was
$4,040.00.
16. The difference between the original billable invoice and the revised billable
invoice was $2,000.00.
17. Heller Excavating did not provide the additional thirty (30) hours of snow
removal services to the township.
a. The revised invoice contained ten (10) hours of plow service at
$55 /hour for an increase of $550.00.
b. The revised invoice also contained twenty (20) additional hours of
backhoe service at $65 /hour totaling $1,300.00.
18. Tunkhannock Township issued check no. 203 [sic] from the PA Local
Government Investment Trust (PLGIT) state fund account to J.E. Heller
Excavating & Hauling, Inc., on January 26, 1996, in the amount of $4,040.00
for emergency snow removal.
a. Check No. 103 was signed and authorized by Tunkhannock Township
Supervisor Thomas Delese and Tunkhannock Township Secretary
Maureen Sterner.
b. Check No. 103 was endorsed by J.E. Heller Excavating & Hauling,
Inc., and processed on January 31, 1996, and deposited into a Heller
Excavating account at First Union Bank.
19. Tunkhannock Township bill list and Treasurer's Report for January 1, 1996,
through February 2, 1996, was presented to the Tunkhannock Township
Board of Supervisors for approval during their monthly meeting on February
7, 1996.
Heller, 99- 021 -C2
Page 5
a. John Heller seconded a motion to pay the bills.
b. Motion carried unanimously.
20. Tunkhannock Township submitted an application for disaster assistance to
the Federal Emergency Management Agency (FEMA) through the
Pennsylvania Emergency Management Agency (PEMA).
a. The application requested financial assistance for costs incurred for
snow removal associated with the January 1996 snow storms.
b. The application was signed by Chairman Thomas Delese and dated
February 29, 1996.
21. The board of supervisors approved resolutions on March 6, 1996,
designating Thomas Delese as agent for the township for disaster relief
projects.
a. Resolution 96 -107 covered the snow storm of January 6, 1996, to
January 11, 1996.
b. Resolution 96 -108 covered the snow storm of January 12, 1996, to
January 19, 1996.
22. During an interview on May 25, 1999, with State Ethics Commission, Special
Investigator Thomas Sleater, John Heller acknowledged the $4,040.00 J.E.
Heller Excavating & Hauling, Inc., received for the emergency snow plowing
was not an accurate amount for the work he performed for Tunkhannock
Township.
a. John Heller reviewed his time sheet logs for January 8 & 9, 1996, and
determined no more than forty (40) hours of snow plowing /hauling
was performed during the emergency conditions.
b. John Heller stated the township was aware of the overpayment.
23. On May 26, 1999, the day after the interview with John Heller by State Ethics
Commission investigators, J. E. Heller Excavating & Hauling, Inc., issued
business check number 1016 to Tunkhannock Township for $2,000.00.
a. Check number 1016 was issued for a payback on check number 103
issued from Tunkhannock Township to J. E. Heller Excavating &
Hauling on January 22 [sic], 1996, for emergency snow removal.
b. Memo portion of check 1016 reads: Snow Emergency
"Overpayment."
B. Testimony
24. Thomas Delese is a Supervisor and the Roadmaster for Tunkhannock
Township, Monroe County, Pennsylvania.
a. Tunkhannock Township has a three member Board of Supervisors.
b. As Roadmaster, Delese has the duty to ensure that the township
roads are safe for travel.
Heller, 99- 021 -C2
Page 6
c. Delese knows Heller as a resident, supervisor, and as an excavator.
d. Heller has a trucking /excavating business known as J. E. Heller that
is run out of his home.
e. On or about January 7, 1996, a blizzard occurred in Tunkhannock
Township.
(1) Over two feet of snow fell which was too much for the
Tunkhannock Township road crew to handle.
(2) The Governor declared a state of emergency as a result of the
snowstorm.
(3)
Delese contacted three contractors, J. M. Brennan, Sincavage,
and Heller to remove snow from the roads.
(a) Delese assigned each contractor to an area of township
roads to remove snow.
(4) Due to the emergency, there was no special meeting,
advertisement, or bid process for plowing snow from the
township roads.
Delese, who himself was plowing the roads, monitored the
contractors' work.
(5)
(a) Heller plowed the roads using his own equipment.
(b) Delese did not know how long it took the contractors to
plow the roads.
(6) The contractors were to bill based upon the hours worked in
removing the snow.
(7) Brennan, Sincavage, and Heller submitted bills for snow
removal.
f. Delese went to Heller's home concerning the snow plowing bill of J.
E. Heller.
(1) Delese testified that both Heller and his spouse were present.
(2) Inside the Heller home, Mrs. Heller informed Delese that she
had the bill for the township.
(a) When Mrs. Heller inquired of Delese as to whether
more money could be obtained, Delese construed that
statement to mean that there was more time for which
to bill.
(b) The first bill prepared by Mrs. Heller was in the amount
of $2,040.00.
Heller, 99- 021 -C2
Page 7
g.
J.
(3)
1. Delese told Mrs. Heller to determine the figures
for the days worked and write it in the bill.
2. Mrs. Heller prepared a second bill in the
presence of Delese.
(c) The second bill had the dates of January 7, 8, 9, 10,
and 13, 1996 as days for snow removal by Heller.
1. Delese did not write anything on either of the bills.
2. Delese did not provide the five dates on the bill
which were written by Mrs. Heller.
(d) After Mrs. Heller sought help from Delese in preparing
the second bill, Delese wrote out the dates, hours, rate,
and equipment used together with horsepower and
capacity which appears as the printed portion on ID
Exhibit 3.
1. Details were needed for the billing in order to get
partial payment from P.E.M.A.
2. Such detailed information was not contained in
the first bill Mrs. Heller prepared.
3. The details as to the days and hours worked
came from Mrs. Heller.
Delese left the Heller home after Mrs. Heller filled out the
second bill.
(4) Delese gave the J. E. Heller bill to the township secretary.
As to township bills, the supervisors have a workshop meeting to
review the bills.
(1) If there are no discrepancies, the bills are subsequently paid at
a monthly meeting.
h. The bill list presented to each supervisor prior to the February 7,
1996, meeting contained the bills from Brennan, Sincavage, and
Heller.
(1) The Brennan bill was $1,560.00, the Sincavage bill was
$997.50, and the J. E. Heller bill was $4,040.00.
The minutes for the February 7, 1996, meeting of the Board of
Supervisors reflect a motion by Delese, second by Heller, to pay bills
which motion passed unanimously.
(1) The bills of Brennan, Sincavage, and Heller for snow plowing
were included in that bills list.
At the March 6, 1996, Board of Supervisors meeting, the minutes of
the meeting of February 7, 1996, were approved.
Heller, 99- 021 -C2
Page 8
k. Tunkhannock Township paid J. E. Heller for snow plowing by a check
in the amount of $4,040.00.
I. In order to get partial reimbursement to Tunkhannock Township for
snow removal expenses, Delese prepared applications to
F. E. M.A. /P. E. M.A.
(1) Delese needed information from Heller as to the equipment
used for snow plowing for the F.E.M.A. /P.E.M.A. application.
(2) The township received partial reimbursement for its snow
removal expenses relating to the state of emergency.
m. In May of 1999, J. E. Heller returned $2,000 to the township as a
snow emergency overpayment.
(1) The issue of overpayment never came up at a township board
meeting prior to the receipt of the check from J. E. Heller.
n. The bills for Tunkhannock Township are listed in either of two funds:
the general fund or the liquid fuels fund.
(1) Bills are grouped for payment under one fund or the other.
o. On the first bill prepared by Mrs. Heller, the township was under billed
by $150.00.
25. Patricia Moore is a subpoenaed witness for the hearing.
a. It was stipulated by the parties that if Moore were called, she would
testify as follows:
In November of 1997, Ms. Moore was elected to be a
supervisor at Tunkhannock Township. She took office in January of
1998. In that interim time period between her election of November of
1997 and January of 1998, she received a telephone call from Mrs.
Heller asking Ms. Moore to come to the Heller residence, which she
did.
At that time, there was some discussion that took place. Mr.
Heller was present. But Ms. Moore said that the discussion took
place between her and Mrs. Heller, at which time there were some
allegations of misconduct made against Thomas Delese, and that
there was a phrase that Ms. Moore [sic] stated to watch your back,
that Mrs. Heller said to - -- Ms. Moore referring to her dealings with Mr.
Delese.
At that time, Ms. Moore was shown some papers. One was a
handwritten bill, which she - -- looked at some exhibits today and
identified the handwritten bill as what - -- ha[s] [been] marked as
Exhibit 1 -A. It's also Exhibit 1, the half of the page. - -- the
enlargement on Exhibit 1 -A and Ms. Moore would testify that Exhibit
1 -A is what was shown to her by Mrs. Heller.
There was also a scratch piece of paper with handwritten
calculations on it that Ms. Moore was show[n] by Mrs. Heller. And - --
some exhibits [have been shown] to Ms. Moore. And Ms. Moore
Heller, 99- 021 -C2
Page 9
identified Exhibit Number Three which was some handwriting that Mr.
Delese had done, - - -, as the handwritten sheet that she saw that had
calculations written on it.
That with the information - - -, she received copies of those two
pieces of paper. She went back at some point and had a discussion
with Mr. Delese about the sheets of paper. She showed them to Tom
Delese. Mr. Delese's response was that there was some formula that
P.E.M.A. required that he used for the calculations that he made.
b. In November 1997, Moore, as a supervisor elect, was called by Mrs.
Heller to come to Heller's home.
(1) Mrs. Heller showed Moore a billing and told Moore to be
careful in her dealings with Delese.
c. Moore met with Delese subsequently about the Heller billing.
(1) Delese told Moore that the figures were calculated from
information given to him.
26. Julia Marie Heller is the spouse of Heller.
a. Julia Heller is the secretary /treasurer /vice - president of J. E. Heller.
b. In January of 1996, Julia Heller and Heller were joint owners of J. E.
Heller.
(1) The legal status of J. E. Heller has changed from corporate to
proprietorship.
c. Heller in January of 1996 became involved in plowing snow on
township roads due to a snow emergency.
d. Mrs. Heller prepares the bills for J. E. Heller.
(1) The workers submit worksheets for the hours worked and
equipment used.
e. Mrs. Heller prepared the first bill to the township for snow removal
based solely upon the worksheet Heller prepared.
f. Delese came to the Heller home concerning the snow removal
services by J. E. Heller for the township.
(1) Delese met with Mrs. Heller to advise that the bill of J. E.
Heller had to be submitted in a certain way.
(2) After Mrs. Heller filled out the second bill, Delese took the
second bill and left.
Mrs. Heller stated that Heller was not home when Delese was
there.
(3)
(4) Mrs. Heller did not raise any question about redoing the J. E.
Heller bill from $2,040.00 to $4,040.00.
Heller, 99- 021 -C2
Page 10
g.
A check in the amount of $2,000.00 from J. E. Heller was sent to the
township as a return for an overpayment.
(1) Mrs. Heller did not return the $2,000.00 after a township audit/
report in November of 1997 revealed a problem as to the J. E.
Heller billing for the January 1996 snowstorm.
(2) The return of the $2,000.00 occurred after SEC investigators
met with Mrs. Heller.
(3)
27. Heller is an equipment operator for J. E. Heller and a former supervisor in
Tunkhannock Township.
a. Heller performed snow removal services through J. E. Heller for the
township in January 1996.
(1) Delese made the decision to hire J. E. Heller to do the January
1996 snow plowing in the township.
(2) Exhibit ID 2 accurately reflects the time he worked in January
1996 cleaning snow on township roads.
Heller did not work for the township on January 10, 1996, and
January 13, 1996.
(4) When Delese came to the Heller home regarding the bill,
Heller testified that he was not at home and was out plowing
snow.
(3)
Heller was advised by letter of May 4, 1999 that he was under
investigation; the $2,000.00 check was returned to the
township on or about May 26, 1999.
b. At the February 7, 1996, meeting of the Board of Supervisors, Heller
voted in favor of the motion to approve bills which motion passed
unanimously.
(1) Heller states that the last page of the bill list which included
the bill of J. E. Heller in the amount of $4,040.00 was not
attached.
(a) Heller concedes that the page containing the J. E.
Heller bill possibly could have been attached to the bill
list.
(b) Heller admits that the bill of J. E. Heller for snow
plowing services would be on a bill list for the
supervisors to approve and that he should not vote on a
bill of J. E. Heller.
c. About October of 1997, Heller was summoned to meet with an auditor
concerning the payment of $4,040.00 from the liquid fuels account.
(1) The auditor advised that a township supervisor may not
work for the township and receive payment from that
fund.
Heller, 99- 021 -C2
Page 11
(2) Heller did not meet with the auditor; his spouse and
Delese had the meeting.
d. Heller states that he had a good relationship with Delese until Delese
was not reappointed as roadmaster at a township reorganizational
meeting in January of 1997.
e. The audit of the township did not question the number of hours
submitted by J. E. Heller, just the liquid fuels account from which
payment was made.
f. Heller testified that when he learned from the township audit that the
J. E. Heller bill was $4,000[sic], he knew the bill was inflated.
28. At the February 7, 1996, Board of Supervisors meeting, Heller knowingly
voted to approve a bill of $4,040.00, which was inflated by $2000.00, of J. E.
Heller for snow removal services performed for the township during January
of 1996.
C. Documents
29. ID -1 is a photocopy of two bills prepared by Mrs. Heller of J. E. Heller for
snow removal services preformed for Tunkhannock Township.
a. The first bill reflects snow removal services performed on January 7
and 8, 1996, in the amount of $2,040.00.
(1) The bill includes a charge for 10 hours of backhoe use @
$65.00 per hour which is listed at only $500.00 and not
$650.00.
b. The second bill reflects snow removal services performed on January
8, 9, 10, and 13, 1996, in the amount of $4,040.00.
30. ID -4 is a photocopy of Tunkhannock Township check number 103 dated
January 26, 1996, in the amount of $4,040.00 to J. E. Heller for providing
snow removal services.
31. ID -6 is a photocopy of the minutes of the Board of Supervisors of
Tunkhannock Township for February 7, 1996.
a. Supervisors present were Heller, Delese and Wieand.
b. Delese made a motion to pay bills, second by Heller, which motion
carried unanimously.
(1) The bill of J. E. Heller in the amount of $4,040.00 for snow
removal services was included in the bills list.
32. ID -7 is a photocopy of the minutes of the Board of Supervisors of
Tunkhannock Township from March 6, 1996.
a. Supervisors present were Delese, Heller and Wieand.
b. The minutes of the meeting of February 7, 1996, were unanimously
approved.
Heller, 99- 021 -C2
Page 12
33. ID -8 is a photocopy of the bill list for Tunkhannock Township from January 1,
1996, to February 2, 1996.
a. The bills consist of seven pages of bills payable from the general
fund.
b. The bills also consist of one page of bills payable from the Liquid
Fuels Fund to three entities.
(1) A bill of Brennan in the amount of $1,560.00 for snow removal
for 24 hours at $65 /hour.
(2) A bill of J. E. Heller in the amount of $4,040.00 for emergency
snow plowing on January 8, 9, 10, and 13, 1996, without any
rate or time.
A bill of Sincavage in the amount of $997.50 for 8 hours at
$75 /hour plus 6 hours at $75 /hour.
34. ID -9 is a photocopy of documents as to the State funds utilized by
Tunkhannock Township for the calendar year 1996.
(3)
a. A payment in the amount of $4,040.00 was made to J. E. Heller by
check number 103 dated January 26, 1996.
35. ID-10 is, in part, a photocopy of a letter from P.E.M.A. to Delese as agent for
Tunkhannock Township advising of a grant of $8,139.00 relative to the
blizzard of January 1996.
a. The P.E.M.A. application has certification requirements, one of which
is that:
The Applicant agrees to establish internal personnel safeguards
which will prohibit employees from using their positions for a purpose
that creates, or gives the appearance of creating, a desire for private
gain for themselves or for others, particularly those persons who have
a family, business, or other tie to the employee."
b. ID -10, page 15, reflects, inter alia, an item as a contract in the amount
of $4,040.00.
36. ID -14 is a photocopy of a check of J. E. Heller, number 1016, dated May 26,
1999, to Tunkhannock Township in the amount of $2,000.00 with a notation
in part of "snow emergency `overpayment'."
37. ID -15 is a photocopy of the resignation of Heller as Supervisor of
Tunkhannock Township effective June 18, 1999.
38. ID -16 is a photocopy of portions of an audit by the Department of Auditor
General of the Commonwealth of Pennsylvania of the Liquid Fuels Fund of
Tunkhannock Township for a two -year period ending December 31, 1996.
a. The audit made the following finding:
"During our audit, we noted the township expended $4,040.00 from
the Liquid Fuels Tax Fund for snow removal during the Blizzard of
Heller, 99- 021 -C2
Page 13
65 Pa. C. S. §1103(a).
1996. We further noted that the above amount was paid to John E.
Heller who is a supervisor for Tunkhannock Township."
"Based on the above - mentioned codes, the monies expended from
the Liquid Fuels Tax Fund appears to be nonpermissible."
* **
We recommend the Department of Transportation review this
finding to determine if any or all of the $4,040.00 should be
reimbursed to the Liquid Fuels Tax Fund.
We further recommend, in the future, the township comply with the
Second Class Township Code and State Ethics Law as noted
above."
39. ID -17 is a photocopy of a memo dated April 7, 1999 of the Executive
Director initiating a preliminary inquiry as to Heller.
40. ID -18 is a photocopy of a memo dated May 4, 1999 of the Executive
Director authorizing the initiation of a full investigation as to Heller.
41. ID -19 is, in part, a photocopy of the notice of investigation sent to Heller
by the Executive Director by letter of May 4, 1999.
42. ID -21 are photocopies of the status of the Heller case sent by the
Investigative Division dated August 21, 2000; June 5, 2000; March 13,
2000; December 31, 1999; October 12, 1999; and July 23, 1999.
43. The Investigative Division complied with all timing and notice
requirements imposed by the Ethics Law as to the Heller preliminary
inquiry and investigation.
III. DISCUSSION:
At all times relevant to this matter, the Respondent, John Heller, hereinafter Heller,
has been a public official subject to the provisions of the Public Official and Employee
Ethics Law ( "Ethics Law "), Act 9 of 1989 as codified by Act 93 of 1998.
The allegation is that Heller used the authority of his office for the private pecuniary
benefit of himself and /or a business with which he is associated by participating in actions
and decisions to award J. E. Heller Excavating & Hauling contracts by the township; when
he over billed the township for work performed and subsequently participated in actions to
approve payments; and when the contracts entered into by J. E. Heller Excavating &
Hauling with the township occurred without an open and public process.
The term "conflict of interest" is defined under Act 9 of 1989 as follows:
Section 3(a)/1103(a). Restricted activities.
(a) Conflict of interest. - -No public official or public
employee shall engage in conduct that constitutes a conflict
of interest.
Heller, 99- 021 -C2
Page 14
Section 2. 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 of his immediate
family is associated. "Conflict" or "conflict of interest" 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 3(a)/1103(a) of the Ethics Law 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.
Section 3(f)/1103(f) of Act 9 of 1989 provides:
Section 3. Restricted activities
(f) No public official or public employee or his
spouse or child or any business in which the person or his
spouse or child is associated shall enter into any contract
valued at $500 or more with the governmental body with which
the public official or public employee is associated or any
subcontract valued at $500 or more with any person who has
been awarded a contract with the governmental body with
which the public official or public employee is associated,
unless the contract has been awarded through an open and
public process, including prior public notice and subsequent
public disclosure of all proposals considered and contracts
awarded. In such a case, the public official or public employee
shall not have any supervisory or overall responsibility for the
implementation or administration of the contract. Any contract
or subcontract made in violation of this subsection shall be
voidable by a court of competent jurisdiction if the suit is
commenced within 90 days of the making of the contract or
subcontract.
65 Pa. C.S. §1103(f).
Section 3(f)/1103(f) specifically provides in part that no public official /public
employee or spouse or child or business with which he or the spouse or child is associated
may enter into a contract with his governmental body valued at five hundred dollars or
more or any subcontract valued at five hundred dollars or more with any person who has
been awarded a contract with the governmental body with which the public official /public
employee is associated unless the contract is awarded through an open and public
process including prior public notice and subsequent public disclosure.
Heller, 99- 021 -C2
Page 15
facts.
Having noted the issues and applicable law, we shall now summarize the relevant
Heller was a Supervisor in Tunkhannock Township between January 1994 and June
19, 1999. In a private capacity, Heller is the joint owner of J. E. Heller Excavating and
Hauling, Inc. (J. E. Heller). The legal status of J. E. Heller has now changed from a
corporation to a proprietorship; however, given Heller's financial interest in J. E. Heller, it is
a "business with which he is associated" as that term is defined under the Ethics Law.
See, Section 402/1102 of Act 9 of 1989 as codified by Act 93 of 1998.
In January of 1996, a severe snowstorm deposited over two feet of snow in
Tunkhannock Township. A second snowstorm occurred approximately one week later. A
state of emergency was declared by the Governor. Supervisor Delese, who was the
roadmaster, had the responsibility of clearing the snow from township roads. The situation
in the township was complicated because some of the township equipment were not
operable.
Because of the large amounts of snow and the restricted ability of the township to
handle the snow emergency, Delese contacted contractors who could plow the township
roads: J. M. Brennan and Sons, Inc.; Sincavage Corporation; and J. E. Heller. Delese
assigned each of the three contractors to an area of the township for snow removal.
Shortly after the blizzard, Delese visited the Heller home. During that meeting,
Delese and Mrs. Heller were present. There is contradictory testimony regarding whether
Heller was also present during Delese's visit. Discussions ensued concerning a bill of J.
E. Heller prepared by Mrs. Heller in the amount of $2,040.00 for snow removal services for
the township. At that time a second bill was prepared by Mrs. Heller for snow removal
services with the substitute bill totaling $4,040.00.
There is also contradictory testimony why the second bill was prepared and
substituted for the first bill. Mrs. Heller testified that the second bill was prepared at the
direction of Delese who indicated that the first bill was not right. Mrs. Heller also testified
that she did not question that $2,000.00 was added to the bill for the snow removal
because Delese was the supervisor. Delese, however, testified that the bill had to be
redone for two reasons: Mrs. Heller inquired about more money, presumably for additional
snowplowing; and the first bill lacked detail in terms of the type of equipment that was
used. Delese stated that such detail was necessary in order for the township to submit an
application for disaster relief funds as to the emergency snow removal.
At a February 7, 1996, meeting of the Board of Supervisors of Tunkhannock
Township, Delese made a motion to pay the bills, with a second by Heller. The motion
carried unanimously. Typically, the supervisors would have a work session prior to a
meeting to review the pending bills in order to resolve any problems.
The bill list for Tunkhannock Township was in two parts for the February 7, 1996,
meeting. The first part consisted of seven pages of bills that were payable from the
general fund. The second part was a one -page document for three bills that were payable
from the Liquid Fuels Fund for snow removal services provided by the three contractors:
Brennan in the amount of $1,560.00; J. E. Heller in the amount of $4,040.00; and
Sincavage in the amount of $997.50.
Heller testified that the last page of the bill list, which included the bill of J. E. Heller
for snow removal, was not part of the bill list that he had received. Heller based his
statement upon his view that he would not have voted to approve a bill submitted by his
own business. However, Heller concedes that it was possible that he did have the
complete bill list.
Heller, 99- 021 -C2
Page 16
At the March 6, 1996, board meeting of the Tunkhannock Township Supervisors,
Delese made a motion, second by Heller, to approve the minutes of the January 7, 1996,
meeting, which motion carried unanimously.
J. E. Heller received a check from the township dated January 26, 1996, in the
amount of $4,040.00 which was deposited into the J. E. Heller account. The township
subsequently submitted an application for a grant in relation to the snow removal during
the state of emergency and received $8,139.00.
The matter of the bill by J. E. Heller for the snow removal services became an issue
following an audit /report in the fall of 1997 of the Liquid Fuels Tax Fund of Tunkhannock
conducted by the Department of Auditor General for the two -year period ending December
31, 1996. As part of that audit, there was a finding of a possible Ethics Code violation.
The audit report noted that $4,040.00 was expended from the Liquid Fuels Tax Fund for
snow removal by John E. Heller. After reciting that Heller was a supervisor in the township
and subject to the Second Class Township Code and the Ethics Law, the report concluded
it was impermissible to expend Liquid Fuels Tax Fund monies to pay Heller. The audit
made no mention of the $2,000.00 that was added to the bill submitted by J. E. Heller to
the township. Following the audit, Heller reviewed the situation but took no action.
Approximately one and one half years later, Heller received a letter dated May 4,
1999, from the Investigative Division advising that he was under investigation for the snow
removal services performed by his business for the township. A few weeks later, J. E.
Heller sent a check to the township in the amount of $2,000.00 for the snow removal
services which was characterized as an overpayment. Although Heller concedes that the
sum of $4,040.00 was readily apparent to him as an overpayment, he testified that he was
not aware of that amount being submitted to the township until after the audit by the
Auditor General.
Heller through his counsel made a motion to dismiss in the nature of a demurrer
following the completion of the case by the Investigative Division at the hearing in this
matter. Based upon our findings as to the third and fourth allegations below, we deny the
motion.
The Investigative Division in its Brief argues for violations of the Ethics Act based on
Heller's participating in a vote on a matter of self- interest and his business contracting with
the township without an open and public process as to a contract in excess of $500.00.
Specifically, it is argued that Heller failed to abstain as to the vote on a J. E. Heller bill in
the amount of $4,040.00 which bill was inflated by $2,000.00 over the hours actually
worked in snow plowing. The Investigative Division argues that Heller was not credible as
to the billing which provided an opportunity to obtain an excess payment because of the
availability of government disaster funds. It is asserted that Supervisor Delese was a
credible witness who had nothing to gain. The Investigative Division concludes by seeking
an order directing payment of $4,040.00 plus interest plus a treble penalty of $12,120.00.
Heller proffers in his Brief that there are no violations of the Ethics Act as to the four
charges based upon the following main arguments: Heller did not participate in the action
to hire his corporation and hence Heller did not use the authority of office; the corporation,
not Heller, over billed the township; Heller took action by virtue of the Emergency
Management Services Act which extended to Heller's subsequent action of approving
payment to his corporation which in essence constituted the confirmation of a prior legal
act; and the Emergency Management Services Act obviated the need to advertise for bids
as to the contract to Heller's corporation, even though the contract was in excess of
$500.00 and was awarded without an open and public process.
Heller, 99- 021 -C2
Page 17
We shall now apply the provisions of the Ethics Act to the four allegations which
may be broken down as follows:
1. Whether Heller used the authority of office by participating in actions to
award a snow removal contract to J. E. Heller;
2. Whether Heller used the authority of office to over bill the township for
work performed by J. E. Heller in removing snow from township roads;
3. Whether Heller used the authority of office by participating in actions of
the township board of supervisors to approve payments to J. E. Heller for
providing snow removal services to the township; and
4. Whether J. E. Heller, a business with which Heller is associated, entered
into a contract with the township to perform snow removal services
without an open and public process as to a contract in excess of $500.00.
In order to establish a violation of the Ethics Act, each of the requisite components
of Section 3(a)/1103(a) must be present. The issue as to the first three allegations is
whether Heller, as a public official, used the authority of office for a private pecuniary for
himself or a business with which he is associated. The record establishes a pecuniary
benefit in this case consisting of the overpayment of $2,000.00 which was made to J. E.
Heller for snow removal services for the township. That pecuniary benefit inured to J. E.
Heller, a business with which Heller is associated. The only remaining question is whether
there was a use of authority of office. Without such a use of authority of office, there can
be no violation of Section 3(a)/1103(a) of the Ethics Act. See Marchitello & McGuire v.
SEC, 657 A.2d 1346 (Pa. Commw. Ct. 1995).
As to the allegation that Heller participated in the action to award the snow removal
contract to J. E. Heller, the Investigative Complaint contains an (admitted) averment that
such decision was solely made by Delese. Since Delese solely made the decision, Heller
played no part in it. Consequently, there was no use of authority of office by Heller.
Hence, Heller did not violate Section 3(a)/1103(a) of the Ethics Act as to that aspect of the
allegation involving the award of the snow removal contract to J. E. Heller.
Turning to the second allegation regarding the over billing, our focus again must be
on whether there was a use of authority of office on the part of Heller. The parties have
delved into the circumstances surrounding the initial bill written by Mrs. Heller as well as
the second bill which increased the invoice amount by $2,000.00. As noted, there is
conflicting testimony as to whether Heller was present at that meeting with Delese and
Mrs. Heller. We need not resolve such issues which are irrelevant. Even assuming that
Heller were present at that time, his presence would have been in the capacity of a
contractor performing snow plowing services on behalf of J. E. Heller and not as a
township supervisor. Hence, there could not have been any use of authority of office by
Heller. On that basis, we find no violation as to that particular aspect of the allegation
involving the over billing.
Passing over the third allegation for the moment, we shall address the fourth
allegation involving the contracting which occurred as a result of a declared state of
emergency due to the blizzard in January of 1996. In Courter /Dotterer, Opinion 93 -001,
we determined that township supervisors, as working employees, may be compensated for
their personal time clearing roads during a state of emergency after a snowstorm at the
hourly rate set by the township auditors under Section 3(a) of the Ethics Act. In
Courter /Dotterer, we did not address the applicability of the contracting provision of the
Ethics Law which does not provide any exception for emergency or any other similar
situations.
Heller, 99- 021 -C2
Page 18
In this case, there was no time for the township board to advertise for bids for snow
removal given the dangerous situation that existed. However, we have the contracting
provision of the Ethics Act which has a uniform requirement that any contract between the
public official or the business with which he is associated and his governmental body must
be through an open and public process if the contract is $500.00 or more. In order to have
a literal application of the contracting provision, as we must, to the extraordinary facts of
this case involving the state of emergency following the blizzard, we find a mere technical
violation of Section 3(f)/1103(f) of the Ethics Act when J. E. Heller, a business with which
Heller is associated, contracted with the township for snow removal services during a state
of emergency when the contract was over $500.00 and not awarded through an open and
public process.
Returning to the third allegation which involves whether Heller used the authority of
office in participating to approve payments to J. E. Heller as to the contract for snow
removal on township roads, the issue centers upon the approval of the bills list. In certain
instances the action of approving a block of bills in a list by a supervisor may only
constitute a technical violation, as for example, in cases where there is a routine
uncontested bill submitted by a business with which the public official is associated. In
other instances, such an action can be of major import. In this case, we find Heller's
conduct to be serious. We have a situation where a bill was inflated by $2,000.00 for snow
removal services. That bill was not part of a list of dozens of other bills but was part of
only three bills from a separate fund, the Liquid Fuels Fund: one from J. E. Heller and the
other two from Sincavage and Brennan. Heller readily admits that he knew a bill of
approximately $4,000.00 for the snow removal services was over inflated. Although Heller
testified that he was not aware of the amount of the bill until after the audit by the Auditor
General, we find that Heller knew about the bill and its amount but nevertheless voted for
its approval at the board meeting on February 7, 1996. Such action in seconding the
motion to approve the bills as well as voting in favor of that motion constitute uses of
authority of office. See, Juliante, Order 809. That use of authority of office resulted in a
private pecuniary benefit which consisted of $2,000.00 by which J. E. Heller over billed the
township. Lastly, that private pecuniary benefit inured to Heller and the business with
which he is associated, J. E. Heller.
As to the above, there is no question that Heller knowingly voted to approve the
over billing by J. E. Heller at the February 7, 1996, Board of Supervisor's meeting. First,
Heller admitted that he knew any bill that he submits to the township would shortly
thereafter come before the board for approval of payment. In this regard, Heller performed
the services and J. E. Heller submitted the bill in January which appeared on the February
bill list for payment. Second, the supervisors had workshops prior to board meetings to go
over the bills. Third, Heller admitted that he knew the J. E. Heller bill of $4,040.00 was
inflated, although Heller maintains that he did not know the amount of the bill until some
time later. Fourth, although Heller states that the bill of J. E. Heller was not part of the bill
list he had, he concedes that he could have had that page. Finally, the approved minutes
reflect Heller making the second to the motion to approve the bills list, which included the
bill of J. E. Heller. That motion was approved by a unanimous vote.
Accordingly, Heller violated Section 3(a)/1103(a) of the Ethics Act when he, as a
Tunkhannock Township Supervisor, used the authority of office by seconding a motion and
voting in favor of that motion to approve the payment of bills which included an inflated
payment to J. E. Heller, a business with which he is associated, as to a contract for snow
removal services for the township. See, Spotts, Order 1050.
Our decision as to the Section 3(a)/1103(a) violation of the Ethics Act follows the
decision of Commonwealth Court in Snyder v. SEC, 686 A.2d 843 (Pa. Commw. Ct. 1996).
In the cited case, Commonwealth Court affirmed a decision of this Commission, finding a
violation by a township supervisor who participated in matters involving a business with
which he is associated that had matters pending before the township. Commonwealth
Heller, 99- 021 -C2
Page 19
Court held that a public official should not participate in matters with which he has a
personal interest and further noted that that prohibition applies even if the public official
would not be the deciding vote as to those matters as to which he had a conflict:
We are likewise unconvinced by the fact that Snyder's vote was never
controlling or necessary for a quorum. Snyder violated the Ethics Law by
discussing and voting on issues in which he had a private pecuniary interest,
not by affecting the outcome of those votes. Similarly, it is irrelevant whether
Snyder improperly used his influence as a Supervisor to gain the Colonial
Commons and Blue Meadow contracts; Snyder may have been able to
obtain the jobs even if he were not a Supervisor, but as a Supervisor, he
should not have considered and voted on issues involving his personal
business dealings.
Id. at 849.
As to the above finding of a violation, we have a straightforward application of the
Ethics Law to the operative facts which we do not consider to be in dispute. J. E. Heller
submitted a bill which was overstated in the amount of $2,000.00. That over billing was
submitted to the township board of supervisors for approval. Heller, as a township
supervisor, used the authority of office to approve that bill to the business with which he is
associated, J. E. Heller. As a consequence, J. E. Heller received payment, of which
$2,000.00 was an over billing, as to snow removal services performed. Such action
constituted a violation of Section 3(a)/1103(a) of the Ethics Act.
As to the arguments of Heller regarding the above violations of Sections 3(a)/
1103(a) and 3(f)/1103(f), his argument concerning preemption by the Emergency
Management Service Act and the lack of attribution to Heller due to the corporate status of
J. E. Heller fail. Whenever a provision of the Ethics Law conflicts with any other law, the
Ethics Law prevails. See, 65 Pa.C.S. §1112. Second, even though Heller's business at
the time was in corporate form, it is a "business with which he is associated" as that term is
defined under the Ethics Law. See, 65 Pa.C.S. §1102.
Section 407(13)/1107(13) of the Ethics Law specifically empowers this Commission
to impose restitution plus interest in those cases where a public official /employee has
received a financial gain in violation of the Ethics Law. The private pecuniary benefit in
this case amounted to $2,000.00. The interest at the legal rate of 6% on $2,000.00 from
January 1996 when J. E. Heller received that payment until May 1999 when the $2,000.00
"overpayment" was paid back to the township amounts to $400.00. J. E. Heller under
billed the township in the computation of the first bill by $150.00. By offsetting the $150.00
against the interest of $400.00 we find that the balance is $250.00. Accordingly, Heller is
directed within 30 days of the date of mailing of this order to make payment through this
Commission to Tunkhannock Township in the amount of $250.00. Failure to comply will
result in the institution of an order enforcement action.
IV. CONCLUSIONS OF LAW:
1. John Heller, as a Supervisor in Tunkhannock Township, was a public official subject
to the provisions of Act 9 of 1989.
2. Heller did not violate Section 3(a)/1103(a) of the Ethics Act as to the action to
award a snow removal contract to J. E. Heller Excavating and Hauling in that such
action was solely taken by another supervisor.
3. Heller did not violate Section 3(a)/1103(a) of the Ethics Act as to over billing the
township for snow removal services by J. E. Heller Excavating and Hauling in that
Heller, 99- 021 -C2
Page 20
there was no use of authority of office by Heller as a Supervisor as to the over
billing.
4. Heller violated Section 3(a)/1103(a) of the Ethics Act when he participated in Board
action to approve payment for snow removal services as to which J. E. Heller
Excavating and Hauling over billed the township by $2,000.00.
5. A technical violation of Section 3(f)/1103(f) of the Ethics Act occurred when J. E.
Heller Excavating and Hauling, a business with which Heller is associated, received
a no bid contract in excess of $500.00 with the township for snow removal services
during a declared snow emergency.
In Re: John Heller
File Docket:
Date Decided:
Date Mailed:
ORDER NO. 1176
BY THE COMMISSION,
99- 021 -C2
12/12/00
12/27/00
1 John Heller, a Supervisor in Tunkhannock Township, did not violate Section
3(a)/1103(a) of the Ethics Act as to the action to award a snow removal contract to
J. E. Heller Excavating and Hauling in that such action was solely taken by another
supervisor.
2. Heller did not violate Section 3(a)/1103(a) of the Ethics Act as to over billing the
township for snow removal services in that there was no use of authority of office by
Heller as a Supervisor as to the over billing.
3. Heller violated Section 3(a)/1103(a) of the Ethics Act when he participated in Board
action to approve payment for snow removal services as to which J. E. Heller
Excavating and Hauling over billed the township by $2,000.00.
4. A technical violation of Section 3(f)/1103(f) of the Ethics Act occurred when J. E.
Heller Excavating and Hauling, a business with which Heller is associated, received
a no bid contract in excess of $500.00 with the township for snow removal services
during a declared snow emergency.
5. Heller is directed to make payment of $250.00 through this Commission to
Tunkhannock Township within thirty days of the date of issuance of this order.
a. Failure to comply with the above will result in the institution of an order
enforcement action.
DANEEN E. REESE, CHAIR