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HomeMy WebLinkAbout1246 LivolsiIn Re: Lucian Livolsi File Docket: X -ref: Date Decided: Date Mailed: Before: Louis W. Fryman, Chair John J. Bolger, Vice Chair Daneen E. Reese Frank M. Brown Susan Mosites Bicket Donald M. McCurdy Michael Healey 01- 069 -C2 Order No. 1246 9/4/02 9/25/02 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 Act, Act 9 of 1989, P.L. 26, 65 P.S. §§ 401 et seq., as codified by Act 93 of 1998, Chapter 11, 65 Pa.C.S. § 1101 et seq., by the above -named Respondent. At the commencement of its investi9ation, the Investigative Division served upon Respondent written notice of the specific allegation(s). Upon completion of its investi9ation 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 and Stipulation of Findings were submitted by the parties to the Commission for consideration. The Stipulation of Findings is quoted as the Findings in this Order. 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 Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter 11 of Act 93 of 1998, 65 Pa.C.S. § 1101 et seq., which essentially repeats Act 9 of 1989 and provides for the completion of pending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. Livolsi 01- 069 -C2 Page 2 I. ALLEGATION: That Lucian Livolsi, a (public official /public employee), in his capacity as Council Person for the Borough of Canonsburg, Washington County, violated Sections 3(a)/1103(a), 3(f)/1103(f) and 4(a)/1104(a) of the Public Official and Employee Ethics Law (65 Pa.C.S. §1101 et seq.) when he participated in actions and discussions of council resulting in a business with which he and /or members of his immediate family is associated being awarded contracts for the repair and maintenance of air conditioning units, furnaces and outdoor lighting; when these contracts in excess of $500.00 were awarded without an open and public process; and when he failed to file Statements of Financial Interests for the 1998, 1999 and 2000 calendar years. II. FINDINGS: 1. Lucian Livolsi has served as a Councilman for Canonsburg Borough, Washington County, since June 8, 1998. a. Livolsi was appointed to fill an unexpired term. b. Livolsi was elected Vice - President of Council at the January 2002 re- organization meeting. 1. Livolsi previously held no office on Council. 2. Canonsburg Borough government consists of a nine member council and mayor. a. Voting regarding the spending of Borough funds or other official action occurs in roll -call fashion. b. The board has, on occasion, taken action on matters by way of group consensus. c. The mayor votes on motions only in case of a tie. 3. Canonsburg Borough generally holds two Council meetings per month. a. A workshop meeting is held on the first Monday of the month. b. The legislative meeting is held on the second Monday of the month. 4. Alice Prokopovitch has served as the Borough Manager for Canonsburg Borough since approximately January 1999. a. As Borough Manager, Prokopovitch is responsible for contacting vendors when various maintenance /repair services are required by the Borough. b. Prokopovitch generally contacts vendors via the telephone regarding maintenance /repair services required. c. Prokopovitch does not publicly advertise for bids regarding services needed if the work will not exceed the $10,000.00 bidding threshold as documented in the Borough Code. d. Prokopovitch generally contacts three to four vendors and obtains phone quotes regarding work to be performed. Livolsi 01- 069 -C2 Page 3 e. Prokopovitch discards the estimates after determining the low bidder unless the cost of the work is significant. 1. Prokopovitch determines what is considered excessive based on the service required. 5. Prokopovitch is authorized to approve the use of vendors for services in and around the municipal building if costs associated with the services are not excessive. a. Prokopovitch is authorized to determine which vendor is awarded the job. b. Prokopovitch is not required to obtain prior approval of council before awarding the job. c. Approval of Council is provided after - the -fact by approving the monthly bill list on which payment to the vendor is documented. 6. In approximately 1995, Canonsburg Borough replaced the existing HVAC system in the municipal building. a. The replacement was done in conjunction with the renovation of the municipal building. b. Controlled Climate Systems, Inc., 577 West Pike Street, Canonsburg, Pa 15317, installed the new HVAC system in the municipal building. 1. The system installed by Controlled Climate was covered by a one -year warranty. 2. The Borough subsequently entered into service agreements with Climate Control in 1996 and 1997 that took effect in 1997 and 1998. 7. Canonsburg Borough did not extend the warranty /maintenance agreement with Controlled Climate after its expiration in 1998 due to the lack of satisfaction of the quality of services provided by Controlled Climate. 8. Prokopovitch was looking to obtain a HVAC service agreement following the expiration of the agreements with Controlled Climate. 9. Shortly after beginning his service on Borough Council in June 1998, Livolsi had a discussion with Council members Joseph Gowern and Robert Rudge, Prokopovitch (interim Borough Manager at that time), and Solicitor Patrick Derrico regarding Southside Heating Company performing services for Canonsburg Borough. a. The discussion occurred in Council chambers in association with a monthly meeting although the meeting was not officially in session. b. The discussion occurred due to ongoing HVAC and electrical problems within the municipal building and other Borough property. c. Council members Gowern and Rudge initiated the discussion. d. Livolsi was questioned during the discussion if he would consider performing maintenance /repair type work for the Borough as necessary due to Prokopovitch only recently being placed into the Interim Borough Manger position. Livolsi 01- 069 -C2 Page 4 10. Livolsi's occupation as an HVAC /electrical technician was common knowledge among council members. a. Livolsi's knowledge of the HVAC /electrical field was considered valuable among council members due to ongoing maintenance /repair issues with the HVAC system and additional borough property (i.e. street lights, wiring, etc.). 11. Livolsi is currently the sole employee of Southside Heating Company (aka Southside Heating and Air Conditioning and /or Southside Electrical), 517 Park Avenue, Canonsburg, Pa 15317. a. Southside Heating Company performs heating, air conditioning, and electrical contracting work. b. Articles of Incorporation filed on October 2, 1956, document the owner of the business as Louis Livolsi. 1. Louis Livolsi is Livolsi's father. 12. Livolsi began performing general HVAC and electrical repair /maintenance services for Canonsburg Borough in approximately February 1999. a. Southside Heating Company /Livolsi did not perform any work for the Borough prior to Livolsi's appointment to Council. 13. Services performed by Livolsi for Canonsburg Borough were not publicly bid or advertised by Borough Council. a. Services performed by Livolsi were not formally approved by vote of Borough Council prior to the service occurring. b. Prokopovitch does not normally report maintenance /repair services performed at or around the municipal building to Council at monthly meetings. c. Prokopovitch provides this information only upon request by council members. 14. Livolsi was contacted to initiate services for the Borough by Prokopovitch, other council members, and various Borough employees (i.e. the streets commissioner, the chief of police, etc.). a. The majority of requests for Livolsi to "look at" or "take care of" problems in and around the Borough occurred by telephone. 1. Livolsi was occasionally requested informally in council meeting settings to perform services for the borough. b. No formal vote of counsel was taken approving Livolsi to address maintenance /repair type issues. 15. Southside Heating Company/Livolsi was requested /solicited to perform services for the Borough for a variety of reasons, including the Borough receiving a reduced rate for services through Livolsi. a. Livolsi charged the Borough the cost of labor only. Livolsi 01- 069 -C2 Page 5 b. Livolsi supplied any parts necessary for repair /maintenance at cost (no price mark -up) to the Borough. c. Livolsi occasionally performed services for the Borough free of charge. d. Livolsi consistently responded to service calls in a timelier manner than did other vendors. e. Livolsi's quality of work was considered higher by borough officials than other local vendors that had been utilized by the borough in the past. 16. From 1999 through 2001, Livolsi, through Southside Heating Company, billed and was paid by Canonsburg Borough for services associated with maintenance and repair as shown below: Invoice Date 02/02799 05/19/99 06/02- 03/99 06/09/99 02/23/00 03/28/00 05/15/00 Check Number 14491 Check Date 0 /3/09/99 Check Amount $ 295.00 Invoice Description Main fire truck bay - Troubleshoot hanging furnace. Replace % hp blower drive motor 03/99 14587 04/14/99 $ 1,260.00 Troubleshoot generator. Install lighting in building. lights in Mayor's basement hallway. 03/26/99 14675 05/11/99 $ 147.00 Senior Citizens Building. Clean burner assembly, remove blower assembly, pressure wash, lubricate and replace burnt belt, reassemble. emergency emergency Install new office and 14858 07/02/99 $ 72.00 Repair NC in Fireman's lounge rm. 14858 07/02/99 $ 462.00 Repair streetlights between PNC Bank and Jefferies Drug Store. 14858 07/02/99 $ 151.00 Repair lights in Mayor's office and State Representatives office. 15709 03/15/00 $ 2,100.00 Repair Main Street electrical control panel; repair /rewire lights 15809 04/11/00 $ 615.00 Repair traffic light; install new light in rear of office building 16034 06/14/00 $ 735.00 Repair /replace evaporator fan drive system; replace filters, re- program dampers & thermostats; add R -22 gas to system Livolsi 01- 069 -C2 Page 6 Invoice Check Check Check Invoice Date Number Date Amount Description 0677700 16127 07/11/00 $ 1,430.00 Install security lighting in main, rotary, & B.P.W. pavilions; replaced fuse block and wiring in street lights; repair ice machine; replace/ repair lights and ballast in library 07/24/00 16265 08/16/00 $ 568.00 Repair drain on Fire Dept. unit; replace belt on 2 " floor unit, change filters on main 2 " floor, council, & library units; move fire siren 08/04/00 16400 09/13/00 $ 738.00 Install cooling fan in pump #3 08/04/00 VFD drive unit; install ballast and starter in perimeter light fixture; trouble -shoot & install photo cell in fixture in office; repair broken ends /replace bad ballast and burnt bulbs in police dept. light fixtures repair condensate drain on library unit 10/03/00 16661 11/14/00 $ 475.00 Rewire /repair street lights in 10/26/00 plaza lot; troubleshoot and re- program main heat control center for 2 floor of building 12/28/00 7597 12/31/00 $ 960.00 Troubleshoot & repair belt press polymer mixing system; trouble- shoot explosion proof heater in digester #3 12/28/00 16845 12/31/00 $ 1,860.00 Repair /rewire street lights & receptacles; troubleshoot & repair emergency exit light packs; trouble -shoot heater in men's room; trouble -shoot & repair furnace in fireman's lounge 01/30/01 16971 02/06/01 $ 770.00 Troubleshoot & install timing relay in main truck bay fire station; troubleshoot & repair electric in line heater in library basement 02/28/01 7697 03/13/01 $ 2,569.00 Remove heater from press 02/28/01 building and re- install in main building; install 3 phase 480 vac explosion proof heater in digester; install 240 vac welder outlet in garage Livolsi 01- 069 -C2 Page 7 Invoice Check Check Check Date Number Date Amount 03/24701 17192 04710701 $ 440.00 04/30/02 7786 05/08/01 $ 320.00 06/05/01 17410 06/12/01 $ 2,655.00 Invoice Description Installation of lights in State Reps office Troubleshoot & repair contactor on air compressor for belt press; troubleshoot & repair air conditioner on main building roof, add R -22 Repair all street lights on Main Street of town; repair lamp post at borough lot; repair post lamps in center town parking lot; repair all globe lights in Jefferson lot; bucket truck rental; Tri -State Supply Co. Ballast TOTAL $18,622.00 17. None of the services provided by Southside Heating in excess of $500.00 were publicly advertised for bid nor were quotes sought from other vendors. 18. Livolsi maintains a checking account at Three Rivers Bank (Account # 20009199) in association with Southside Heating Company. a. The account is documented as a business checking account. 19. All checks received from the Borough for services rendered were deposited into Southside Heating Company's business checking account at Three Rivers Bank as shown below: Check Number Check Amount Deposit Date 14491 $ 295.00 03/11/99 14587 $ 1,260.00 04/22/99 14675 $ 147.00 05/24/99 14858 $ 685.00 07/19/99 15709 $ 2,100.00 03/15/00 15809 $ 615.00 04/14/00 16034 $ 735.00 06/15/00 16127 $ 1,430.00 07/14/00 16265 $ 568.00 08/25/00 16400 $ 738.00 09/14/00 16661 $ 475.00 11/24/00 16845 $ 1860.00 01/05/01 07597 $ 960.00 01/05/01 16971 $ 770.00 02/14/01 07697 $ 2,569.00 03/14/01 17192 $ 440.00 04/11/01 07786 $ 320.00 05/24/01 17410 $ 2,655.00 06/18/01 Total $18,622.00 a. Deposited checks are endorsed, "For Deposit Only, Southside Heating Co., 2009199." Livolsi 01- 069 -C2 Page 8 20. Livolsi did not typically vote on bill lists to which payment to Southside Heating Company was documented a. Livolsi typically voted "Present" regarding bill lists documenting payment to Southside Heating Company. 21. Canonsburg Borough Council utilizes the practice of voting "Present" to indicate that a council member is physically present during a roll call vote but is not actively participating in the vote. a. Canonsburg Borough Council considers a vote of "Present" to be synonymous with abstaining. b. A vote of "Present" is utilized when a council member is somehow involved /interested in a motion being voted on by Council. 22. Livolsi participated in voting to approve bill lists in which payment to Southside Heating Company was documented as shown below: Amount Livolsi Meeting Livolsi Check Paid to Motion/ Livolsi Final Approved/ Date Present No. SSH Second Vote Vote Denied 03/08/99 Yes 14491 $ 295.00 No Present 7 -0 -1 Approved 04/12/99 Yes 14587 $ 1,260.00 No Present 7 -0 -1 Approved 05/10/99 Yes 14675 $ 147.00 No Yes 8 -0 -0 Approved 07/12/99 Yes 14858 $ 685.00 No Present 7 -0 -1 Approved 03/13/00 Yes 15709 $ 2,100.00 No Present 7 -0 -1 Approved 04/10/00 Yes 15809 $ 615.00 No Present 8 -0 -1 Approved 06/12/00 Yes 16034 $ 735.00 No Present 8 -0 -1 Approved 07/10/00 Yes 16127 $ 1,430.00 No Present 6 -0 -1 Approved 08/14/00 Yes 16265 $ 568.00 No Present 8 -0 -1 Approved 09/11/00 Yes 16400 $ 738.00 No Present 8 -0 -1 Approved 11/13/00 Yes 16661 $ 475.00 No Present 8 -0 -1 Approved 01/08/01 Yes 16845 $ 1,860.00 No Present 8 -0 -1 Approved 01/08/01 Yes 7597 $ 960.00 No Present 8 -0 -1 Approved 02/12/01 No 16971 $ 770.00 No 7 -0 -0 Approved 03/21/01 Yes 7697 $ 2,569.00 No Present 5 -0 -1 Approved 04/09/01 Yes 17192 $ 440.00 No Present 8 -0 -1 Approved 05/14/01 Yes 7786 $ 320.00 No Yes 8 -0 -0 Approved 17410 $ 2 655.00 - - Total $18,622.00 a. Livolsi voted "Present" during the voting to approve 14 of 17 bill lists on which payment to Southside Heating was documented. b. Livolsi voted "Yes" to approve 2 of 17 bill lists on which payment to Southside Heating was documented. c. Check number 17410 issued to Southside Heating in the amount of $2655.00 could not be located on any approved bill list. 1. Due to lack of documentation, Livolsi's participation regarding the approval of this payment could not be determined. Livolsi 01- 069 -C2 Page 9 23. At no time did Livolsi disclose his relationship with Southside Heating prior to voting on the approval of bill lists on which payment to Southside Heating was documented. a. Livolsi's association with Southside Heating was common knowledge among council members. 24. The Borough Manager and all members of council maintain signature authority over Borough accounts. a. All checks require the live signature of the Borough Manager and two council members. b. The Borough does not utilize signature stamps. 25. Livolsi, through Southside Heating, was issued 18 checks from Canonsburg Borough totaling $18,622.00 as payment for maintenance /repair type services provided. a. Livolsi's signature does not appear on any of the checks issued to Southside Heating as an authorized signatory for the Borough. 26. Livolsi filed Federal Income Tax Returns for calendar years 1998, 1999, 2000, and 2001. a. Included in Livolsi's income tax returns were Schedule C (Form 1040), Profit or Loss From Business reports regarding Southside Heating for each respective year. 27. Southside Heating realized profit percentages from gross income reported for years 1998 through 2001 as shown below: Gross Net Profit Percentage from Year Income Profit Gross Income 1998 $104,188.00 $16,580.00 15.9 1999 $121,476.00 $12,952.00 10.7 2000 $112,331.00 $17,577.00 15.6 2001 $131,139.00 $17,491.00 13.3 28. Southside Heating realized yearly profits as a result of receiving payment from the Borough for services performed as shown below: Gross Profit Profit Year Payment Percentage Realized By Borough 1998 $ 0.00 15.9% $ 0.00 1999 $ 2,387.00 10.7% $ 255.00 2000 $ 9,481.00 15.6% $ 1,479.00 2001 $ 6,754.00 13.3% $ 898.00 Total $ 2,632.00 29. Southside Heating realized a profit of $2,632.00 as a result of performing maintenance /repair type services for the Borough in 1999, 2000, and 2001 while Livolsi served as a Borough Councilman. 30. On October 31, 2001, a Statement of Financial Interests Compliance Review was conducted at the Canonsburg Borough municipal building. Livolsi 01- 069 -C2 Page 10 a. No Statements of Financial Interests were on file for Livolsi in his position as a Borough Councilman. 31. On December 6, 2001, Livolsi was mailed notification by the Commission of an investigation being conducted regarding allegations of violations of the State Ethics Act of which he was the subject. a. The allegations included Livolsi's failure to file Statements of Financial Interests in his position as a Borough Councilman. 32. Livolsi filed Statements of Financial Interests at the Borough building for calendar years 1998, 1999, 2000, and 2001 on January 8, 2002. a. Livolsi filed the Statements of Financial Interests for calendar years 1998, 1999, and 2000, as a result of receiving the notification letter dated December 6, 2001. b. Livolsi disclosed ownership of Southside Heating Company on each SFI filed. c. Livolsi disclosed income from Canonsburg Borough on each SFI filed. 33. During the years when he failed to file Statements of Financial Interests, Livolsi was compensated as follows by Canonsburg Borough. 1998 $0.00 1999 $2,499.64 2000 $2,499.64 III. DISCUSSION: At all times relevant to this matter, the Respondent, Lucian Livolsi, hereinafter Livolsi, has been a public official subject to the provisions of the Public Official and Employee 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 allegation is that Livolsi, as a Canonsburg Borough Council Member, violated Sections 3(a)/1103(a), 3(f)/1103(f) and 4(a)/1104(a) of the Ethics Act when he participated in actions of council resulting in the award of borough contracts to a business with which he is associated for services as to air conditioning units, furnaces and outdoor lighting; when the borough awarded contracts in excess of $500.00 to that business without an open and public process; and when he failed to file Statements of Financial Interests for the 1998, 1999 and 2000 calendar years. Pursuant to Section 3(a)/1103(a) of the Ethics Act, a public official /public employee is prohibited from engaging in conduct that constitutes a conflict of interest. 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 f of ce 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 Livolsi 01- 069 -C2 Page 11 "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 P.S. § 402/65 Pa.C.S. § 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 3(f)/1103(f) of the Ethics Act provides: Section 3/1103. 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 P.S. § 403(f)/65 Pa.C.S. § 1103(f). Section 3(f)/1103(f) of the Ethics Act 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. §4/1104. Statement of financial interests required to be filed (a) 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, Livolsi 01- 069 -C2 Page 12 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)/65 Pa.C.S. §1104(a). Section 4(a)/1104(a) of the Ethics Act 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. As noted above, the parties have submitted a Consent Agreement and Stipulation of Findings. The parties' Stipulated Findings are reproduced above as the Findings of this Commission. We shall now summarize the relevant facts as contained therein. Livolsi has served as a Canonsburg Borough Councilman since1998. In a private capacity, Livolsi is the sole employee of Southside Heating Company, a.k.a., Southside Heating and Air Conditioning or Southside Electrical (Company), a business owned by his father. Canonsburg Borough consists of a nine member council, a mayor and a borough manager, Alice Prokopovitch. For a vendor to provide service to the borough, Prokopovitch is responsible for contacting three or four vendors by telephone to obtain quotes. Prokopovitch does not publicly advertise for bids unless the contract exceeds the $10,000 threshold of the Borough Code. Prokopovitch is authorized to utilize the services of vendors provided the services are not excessive. Prokopovitch awards jobs to vendors and does not obtain prior approval of council which gives an after the fact approval by authorizing payment. In 1995, the borough replaced the existing HVAC system by utilizing Controlled Climate Systems, Inc. (CCS). One year service agreements for the calendar years 1997 and 1998 were also obtained from CCS. Because of dissatisfaction with CCS services, Prokopovitch began searching for a replacement service provider. Since council members knew that Livolsi was an HVAC /electrical technician, there were discussions in council chambers regarding Livolsi performing such maintenance and repair work for the borough. The Company, through Livolsi, began providing general HVAC and electrical repair /maintenance services for the borough in February of 1999. Such services were not publicly bid or advertised. Even the services provided by the Company which were in excess of $500 were not publicly advertised for bid. No quotes were sought from vendors other than the Company. Service contracts by the Company were not formally approved by a vote of council prior to the provision of such services. Livolsi was contacted to provide services for the borough by either Prokopovitch, other council members, or borough employees. The Company was solicited to provide such services through Livolsi because: charges were for labor only, parts were supplied at cost, some labor was performed free of charge, services were performed in a timely manner, and services were done with a high quality of work. A listing of the services performed, together with the charges, check numbers and dates are detailed in Fact Finding 16. As to the Company bills that were submitted to council for approval, Livolsi typically did not vote on such bill lists but only said "present ". In Canonsburg Borough, a "present" vote is only indicative of physical presence but not active participation; in fact, "present" is considered Livolsi 01- 069 -C2 Page 13 synonymous with abstention. As to the 18 bills (one bill is undocumented) that were submitted by the Company to borough council, Livolsi voted present except for two bills where he voted yes, one in the amount of $147.00 and the other $320.00. As to the borough checks that were sent to the Company, Livolsi's signature does not appear on any of the issued checks. For the calendar years 1999 -2001, the profit realized by the Company as to borough contracts totaled $2,632.00. In an October 2001 compliance review for Statements of Financial Interests (SFI's) at the municipal building, no SFI's were on file for Livolsi. After being mailed a notification of investigation in December of 2001, Livolsi filed SFI's at the borough building on January 8, 2002, for the calendar years 1998 through 2001 wherein he disclosed his ownership in the Company and income from the borough. 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 that Livolsi: did not violate Section 3(a)/1103(a) of the Ethics Act in that he did not participate in the actions of council to award borough HVAC equipment repair and maintenance contracts and electrical work and did not approve contract payments made to a business with which he is associated; violated Section 3(f)/1103(f) of the Ethics Act when a business with which he is associated entered into severa contracts with Canonsburg Borough for the repair and maintenance of Borough HVAC equipment and electrical work when those contracts which were in excess of $500 were awarded without an open and public process; violated Section 4(a)/1104(a) of the Ethics Act when he failed to timely file his SFI's for the 1998, 1999, and 2000 calendar years; and pay $500 through this Commission to the Commonwealth of Pennsylvania within 30 days of the mailing date of this Order. In applying Section 3(a)/1103(a ) of the Ethics Act to the instant matter, our focus must be on what, if any, uses of authority of office were taken by Livolsi. The facts establish that the Company is a business with which both Livolsi, as an employee, and his father, as owner, are associated. Further, there were private pecuniary benefits in that the Company made profits on the various borough service contracts. However, the Stipulated Findings reflect that it was either Prokopovitch or other council members who sought to utilize the services of Livolsi. After such services were performed and the borough was billed, Livolsi was listed as "present" for all but two of the bills submitted by the Company. As noted above, "present" is synonymous with abstention in Canonsburg Borough. As to the two bills that Livolsi voted to approve, such bills were small and the net profit would therefore be de minimis. Accordingly, Livolsi did not violate Section 3(a)/1103(a) of the Ethics Act regarding various service contracts that were solicited by the borough manager or other council members for the Company to provide services to the borough when Livolsi did not participate or approve payment in such matters, except for two instances when he voted to approve payment as to two small contracts which actions were de minimis. Regarding Section 3(f)/1103(f) of the Ethics Act, a review of the 18 contracts that the Company performed for the borough reflects that many of those contracts were in excess of $500.00 but were not awarded through an open and public process as required by the Ethics Act. Accordingly, Livolsi violated Section 3(f)/1103(f) of the Ethics Act when the Company, a business with which he and a member of his immediate family are associated, entered into contracts in excess of $500.00 with the Canonsburg Borough when such contracts were not awarded through an open and public process. See; Gallagher, Order 1059. Finally, regarding the SFI allegation, the record reflects that Livolsi did not file his SFI's for the calendar years 1998 through 2000 until after he received notice of this investigation. All three of those SFI's were filed after the due dates. Accordingly, Livolsi violated Section 4(a)/1104(a) of the Ethics Act in each instance when he failed to timely file SFI's for the calendar years 1998, 1999, and 2000. Livolsi 01- 069 -C2 Page 14 We determine that the Consent Agreement submitted by the parties sets forth the proper disposition for this case, based upon our review as reflected in the above analysis and the totality of the facts and circumstances. Accordingly, Livolsi is directed to make payment in the amount of $500 to the Commonwealth of Pennsylvania through this Commission within 30 days of the mailing of this Order. Compliance with the foregoing will result in the closing of this case with no further action by this Commission. Noncompliance will result in the institution of an order enforcement action. IV. CONCLUSIONS OF LAW: 1. Livolsi, as a Canonsburg Borough Council Member, is a public official subject to the provisions of Act 9 of 1989 as codified by Act 93 of 1998. 2. Livolsi did not violate Section 3(a)/1103(a) of the Ethics Act regarding various service contracts that were solicited by the borough manager or other council members for a business with which he is associated to provide services to the borough where Livolsi did not participate or approve payment in such matters, except for two instances when he voted to approve payment as to two small bills where his actions were de minimis. 3. Livolsi violated Section 3(f)/1103(f) of the Ethics Act when a business with which he is associated entered into several contracts with Canonsburg Borough for the repair and maintenance of Borough HVAC equipment and electrical work when those contracts in excess of $500 were entered into without an open and public process. 4. Livolsi violated Section 4(a)/1104(a) of the Ethics Act when he failed to timely file his Statements of Financial Interests for the 1998, 1999, and 2000 calendar years. In Re: Lucian Livolsi ORDER NO. 1246 File Docket: 01- 069 -C2 Date Decided: 9/4/02 Date Mailed: 9/25/02 1. Livolsi, as a Canonsburg Borough Council Member, did not violate Section 3(a)/1103(a) of the Ethics Act regarding various service contracts that were solicited by the borough manager or other council members for a business with which he is associated to provide services to the borough where Livolsi did not participate or approve payment in such matters, except for two instances when he voted to approve payment as to two small bills where his actions were de minimis. 2. Livolsi violated Section 3(f)/1103(f) of the Ethics Act when a business with which he is associated entered into several contracts with Canonsburg Borough for the repair and maintenance of Borough HVAC equipment and electrical work when those contracts in excess of $500 were entered into without an open and public process. 3. Livolsi violated Section 4(a)/1104(a) of the Ethics Act when he failed to timely file his Statements of Financial Interests for the 1998, 1999, and 2000 calendar years. 4. Per the Consent Agreement of the parties, Livolsi is directed to make payment of $500.00 to the Commonwealth of Pennsylvania through this Commission within 30 days of the mailing date of this Order. a. Compliance with the foregoing will result in the closing of this case with no further action by this Commission. b. Non - compliance will result in the institution of an order enforcement action. BY THE COMMISSION, Louis W. Fryman, Chair