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HomeMy WebLinkAbout1190 ThomasIn Re: John C. Thomas File Docket: X -ref: Date Decided: Date Mailed: Before: Daneen E. Reese, Chair Louis W. Fryman, Vice Chair John J. Bolger Frank M. Brown Susan Mosites Bicket Donald M. McCurdy 00- 047 -C2 Order No. 1190 2/26/01 3/12/01 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 allegations. Upon completion of its investigation, the Investigative Division issued and served upon Respondent a Findings Report identified as an "Investigative Complaint." An Answer was not filed and a hearing was deemed waived. The record is complete. A Consent Agreement and Stipulation of Findings were submitted by the parties to the Commission for consideration. The Consent Agreement was subsequently approved. Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter 11 of Act 93 of 1998, 65 Pa.C.S. §1101 et seq., which essentially repeats Act 9 of 1989 and provides for the completion of pending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 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 Chapter 11 of Act 93 of 1998. 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. Thomas, 00- 047 -C2 Page 2 I. ALLEGATION: That John Thomas, a public official, in his capacity as a Councilman for Economy Borough, Beaver County, violated Sections 1103(a) and 1104(a) of the State Ethics Act (Act 93 of 1998) when he used the authority of his office for a private pecuniary benefit by participating in actions resulting in his appointment and receipt of a salary for the position of borough emergency management coordinator; and when he failed to file Statements of Financial Interests for the 1998 and 1999 calendar years. II. FINDINGS: 1. John C. Thomas is a current council member for Economy Borough, Beaver County. a. Thomas has served on Economy Borough Council since January 3, 1994. b. Thomas has served as Vice - President of Council since January 2, 1996. 2. Appointments to borough positions are made at the reorganization meetings. a. Board officers are elected at each reorganization meeting. 3. Economy Borough reorganization meetings occur bi- annually. 4. Appointments to borough positions are made by official motion and vote of council. a. Voting typically occurs as a group vote unless the motion is sensitive in nature or dissension occurs among board members. b. Abstentions or dissenting votes are specifically noted along with the councilperson casting the vote. 5. The position of Emergency Management Coordinator (EMC) has existed in Economy Borough since at least 1990. a. The position of EMC has been filled at every reorganization meeting of borough council since 1990. 6. Job duties as listed in the EMC job description include the following: a. Prepare, maintain and update a current disaster emergency plan for the prevention and alleviation of injury and damage caused by disaster; provide for prompt and effective response to disaster and disaster emergency relief and recovery; conduct hazards vulnerability analysis to determine probability of disasters; keep available emergency management plan and rules and orders of the governor for inspection at the Emergency Operations Center, provide for prompt and accurate information regarding local disaster emergencies to local officials, local agencies and the general public; comply with emergency management report and record keeping requirements. b. Establish, equip, and provide necessary staffing of an Emergency Operations Center to support government operations and emergencies. c. Provide public information and individual and organizational training programs to ensure prompt, efficient disaster emergency services. Thomas, 00- 047 -C2 Page 3 d. Identify and coordinate locally available manpower, materials, supplies, equipment, facilities, and services necessary for disaster emergency readiness response and recovery. e. Develop recommendations to borough council and various agencies to implement precautionary measures necessary to avert potential effects of disasters. f. Execute and enforce rules and regulations established by state and county agencies. g. Assist agencies and organizations with implementation or execution of duties required to achieve the goals of the Emergency Management Act. h. Attend ongoing training seminars required by the state or county agency, or a local official responsible for providing in- service training. 7 No minimum number of hours exists for the EMC to work on a weekly, monthly, or yearly basis. a. No specific work schedule exists for the EMC. b. The EMC has no office at the borough municipal building. c. The EMC does not supervise any individuals. d. The EMC reports directly to borough council. 8. Thomas was appointed as the borough EMC at the January 6, 1992, reorganization meeting of borough council. a. The vote was unanimous. b. Thomas was not a member of borough council at that time. 9. Thomas has been reappointed into the EMC position at each subsequent reorganization meeting since 1992. a. Thomas is currently serving as the borough EMC. 10. Thomas has participated in actions of council appointing him to the position of EMC as follows: Meeting Thomas Final Thomas's Date Present Motion Second Vote Vote 1 -3 -94 Yes Lively Tate 6 -0 Yes 1 -2 -96 Yes Lively Hutson 6 -0 -1 Abstain 1 -5 -98 Yes States* Yagercik 5 -0 -1 Yes 1 -3 -00 Yes Yagercik* Miketa 7 -0 Yes *All Borough appointments were lumped into one single group motion at this meeting. 11. Economy Borough Council passed Resolution No. 258 on March 10, 1992, regarding compensation for the Fire Marshall, Deputy Fire Marshall and EMC. Thomas, 00- 047 -C2 Page 4 12. Resolution No. 258 states, in part, that "...the position of EMC of the Borough of Economy shall be compensated at the rate of thirty -five ($35.00) dollars per month..." a. Resolution No. 258 documented this payment as "compensation." 13. Since March 1992, Thomas has held the EMC position and receives a lump sum payment of $420.00 annually. a. Payment occurs in November or December of each year. b. Payment is issued via check from the borough General Fund Account. c. Thomas' first payment was in December 1992. 14. Signature authority over Economy Borough accounts lies with the Council President, Vice - President, and Secretary. a. Two signatures are required on Economy Borough checks. 15. Checks are typically signed by Council President and the Borough Secretary. a. The Vice - President typically signs in the President's or Secretary's absence. 16. Since 1992, Thomas has received $3,440.00 in reimbursements through his position as borough EMC as shown below: Check Number 69005 7966 9157 10414 11858 13251 1414 1523 Total: Year 1992 1993 1994 1995 1996 1997 1998 1999 Amount Paid $ 420.00 420.00 420.00 420.00 500.00 420.00 420.00 420.00 $ 3,440.00 *Thomas was paid $500.00 in 1996 instead of the established $420.00. a. Thomas's signature as Vice - President appears on check #1414 authorizing reimbursement to himself as EMC. 17. Thomas participated in the approval of bill lists on which his reimbursement as EMC was recorded as shown below: Payment Meeting Thomas Motion/ Thomas' Passing of Received Date Present Second Vote Motion by Thomas Thomas, 00- 047 -C2 Page 5 Meeting Thomas Motion/ Thomas' Date Present Second Vote 11/09/94 Yes No Yes 11/14/95 Yes Motion Yes 11/12/96 Yes Second Yes 11/11/97 Yes No Yes 12/08/98 Yes No Yes 12/14/99 Yes No Yes Passing of Motion Unanimous Unanimous Unanimous Unanimous Unanimous Unanimous Total Payment Received by Thomas $420.00 420.00 500.00 420.00 420.00 420.00 $2,600.00 18. Although Resolution 258 of 1992 termed payments to EMC as compensation, Council considered the payments as reimbursement for expenses. a. Thomas received no IRS Form W -2 or 1099 from Economy Borough for the years 1992 through the present for payments received as EMC. b. Council considered payments to Thomas in his capacity as EMC as reimbursement for expenses incurred for travel to various meetings, seminars, etc, (i.e. mileage, meals, etc). c. Council believed expense reimbursements are not considered income for tax purposes and no W -2 or 1099 was issued. 19. Economy Borough council members are compensated for their service as members of council. a. Council members receive $1,500.00 annually. 1. Council President receives $1,800.00 annually. b. Council members are issued IRS Form W -2's for compensation received. c. Thomas has been compensated for his councilman position and has been issued W -2s for this compensation. 20. The issue of reimbursement was discussed by council during the December 12, 2000, council meeting Finance Committee Report. a. Councilman Miketa inquired whether council gets reimbursement or salary. b. Councilman Rock and Mayor Yagercik stated that council receives a salary that is taxed, reimbursement is not taxed. 1. The mayor added that elected positions are compensated according to the Borough Code. 2. The intent of other positions was to reimburse for any out of pocket expenses that may incur during the year such as gasoline, attendance at meetings, etc. The borough does not require receipts. Thomas, 00- 047 -C2 Page 6 c. Solicitor Fouse advised this appears to have been the borough position. 21. Thomas filed Statements of Financial Interests in relation to his position on Economy Borough council as shown below: Filing Date Calendar Year January 28, 1998 1997 22. No Statements of Financial Interests for Thomas, in relation to his position on Economy Borough Council for calendar years 1998 and 1999, were on file with the Borough. a. Thomas filed forms for 1998 and 1999 on February 13, 2001. III. DISCUSSION: At all times relevant to this matter, the Respondent, John C. Thomas, hereinafter Thomas, has been a public official subject to the provisions of the Public Official and Employee Ethics Law ( "Ethics Law "), Act 9 of 1989, Pamphlet Law 26, 65 P.S. §401, et seq., as codified by the Public Official and Employee Ethics Act, Act 93 of 1998, Chapter 11, 65 Pa.C.S. §1101 et seq., which Acts are referred to herein as the "Ethics Act. The issue is whether Thomas violated Sections 3(a)/1103(a) and 4(a)/1104(a) of the Ethics Act when he participated in actions of Borough Council resulting in his appointment and receipt of a salary as Borough Emergency Management Coordinator; and when he failed to file Statements of Financial Interests for the 1998 and 1999 calendar years. Section 3/1103. Restricted activities (a) Conflict of interest. — No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 P.S. § 403(a)/1103(a). The term "conflict of interest" is defined under Act 9 of 1989/Act 93 of 1998 as follows: Section 2/1102. 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 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. Thomas, 00- 047 -C2 Page 7 65 P.S. § 402/1102. Section 3(a)/1103(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. Section 4/1104. Statement of financial interests required to be filed facts. Public official or public employee. Each public official of the Commonwealth shall file a statement of financial interests for the preceding calendar year with the commission no later than May 1 of each year that he holds such a position and of the year after he leaves such a position. Each public employee and public official of the Commonwealth shall file a statement of financial interests for the preceding calendar year with the department, agency, body or bureau in which he is employed or to which he is appointed or elected no later than May 1 of each year that he holds such a position and of the year after he leaves such a position. Any other public employee or public official shall file a statement of financial interests with the governing authority of the political subdivision by which he is employed or within which he is appointed or elected no later than May 1 of each year that he holds such a position and of the year after he leaves such a position. Persons who are full -time or part -time solicitors for political subdivisions are required to file under this section. 65 P.S. § 404(a)/1104(a). Section 4(a)/1104(a) of the Ethics Act quoted above requires that each public official /public employee must file a Statement of Financial Interests for the preceding calendar year, each year that he holds the position and the year after he leaves it. Having noted the issues and applicable law, we shall now summarize the relevant Thomas has been a member of the Council of Economy Borough, Beaver County, since January 3, 1994 and has served as Council Vice - President since January 2, 1996. In addition, Thomas has served as the Emergency Management Coordinator (EMC) for the Borough since 1992. In 1994, 1998 and 2000, Thomas participated in actions of Council appointing him to the position of EMC. In the years 1994 through1999, Thomas participated in the approval of bill lists containing payments to himself as EMC. As Council Vice - President, Thomas signed one check issued to himself as EMC in 1998. As EMC, Thomas received $420 annually in 1994, 1995, 1997, 1998, and 1999, and received $500 in 1996. In 1992, Borough Council passed Resolution No. 258, which set the rate of "compensation" for the Borough EMC at $35 /month. Although Resolution No. 258 refers to payments to the EMC as "compensation," Council viewed such payments as expense reimbursements. Since Council did not consider expense reimbursements income for tax purposes, Economy Borough did not provide Thomas with IRS W -2 or 1099 forms for the payments he received as EMC. Thomas, 00- 047 -C2 Page 8 As a member of Borough Council, Thomas filed a Statement of Financial Interests (FIS) on January 28, 1998 for the 1997 calendar year. However, Thomas did not file FIS forms as a Council member for calendar years 1998 and 1999 until February 13, 2001. Having highlighted the Stipulated Findings and issues before us, we shall now apply the Ethics Act to determine the proper disposition of this case. The parties' Consent Agreement sets forth a proposed resolution of the allegations. The Consent Agreement proposes that this Commission find that: 1) Thomas did not violate Section 1103(a) of the Ethics Act when he received payments as the Borough EMC, as said payments were in the nature of expense reimbursements rather than compensation; and 2) Thomas violated Section 1104(a) of the Ethics Act when he failed to file Statements of Financial Interests with Economy Borough for the 1998 and 1999 calendar years by May 1, 1999 and May 1, 2000 respectively. As to Section 3(a)/1103(a) of the Ethics Act, Thomas, as a member of Borough Council, participated in actions of Council to appoint himself to the position of EMC, voted to approve bill lists containing payments to himself, and signed one check issued to himself. Such actions of Thomas were uses of authority of office. See, Juliante, Order 809. However, the uses of authority of office by Thomas did not result in a private pecuniary benefit to himself since the payments received as EMC were expense reimbursements rather than compensation. Because the requisite element of a private pecuniary benefit is lacking in this case, we find that Thomas did not violate Section 3(a)/1103(a) of the Ethics Act when, as a member of Borough Council, he used the authority of his office to receive payments as EMC from the Borough. Although the Section 3(a)/1103(a) allegation includes an assertion that Thomas participated in actions resulting in his appointment to the position of EMC, it appears that the Investigative Division, through the exercise of prosecutorial discretion, has chosen not to pursue this aspect of the allegation. We therefore need not address this particular issue. In this regard, we note that since Thomas received expense reimbursements rather than compensation, there was no private pecuniary benefit and hence, no violation of Section 3(a)/1103(a) of the Ethics Act. As to Section 4(a)/1104(a) of the Ethics Act, the Stipulated Facts reflect that Thomas, as a member of Borough Council, failed to timely file FIS forms for calendar years 1998 and 1999. Accordingly, we find that Thomas violated Section 4(a)/1104(a) of the Ethics Act when he failed to file Statements of Financial Interests with Economy Borough for the 1998 and 1999 calendar years by May 1, 1999 and May 1, 2000 respectively. IV. CONCLUSIONS OF LAW: 1. Thomas, as a member of the Economy Borough Council, Beaver County, is a public official subject to the provisions of Act 9 of 1989/Act 93 of 1998. 2. Thomas did not violate Section 3(a)/1103(a) of the Ethics Act when he received payments as the Borough Emergency Management Coordinator, as said payments were in the nature of expense reimbursements rather than compensation. 3. Thomas violated Section 4(a)/1104(a) of the Ethics Act when he failed to file Statements of Financial Interests with Economy Borough for the 1998 and 1999 calendar years by May 1, 1999 and May 1, 2000 respectively. In Re: John C. Thomas File Docket: 00- 047 -C2 Date Decided: 2/26/01 Date Mailed: 3/12/01 ORDER NO. 1190 1 Thomas, as a member of the Economy Borough Council, did not violate Section 3(a)/1103(a) of the Ethics Act when he received payments as the Borough Emergency Management Coordinator, as said payments were in the nature of expense reimbursements rather than compensation. 2. Thomas violated Section 4(a)/1104(a) of the Ethics Act when he failed to file Statements of Financial Interests with Economy Borough for the 1998 and 1999 calendar years by May 1, 1999 and May 1, 2000 respectively. BY THE COMMISSION, DANEEN E. REESE, CHAIR