HomeMy WebLinkAbout1261 SmithIn Re: B. Edward Smith
File Docket:
X -ref:
Date Decided:
Date Mailed:
Before: Louis W. Fryman, Chair
John J. Bolger, Vice Chair
Daneen E. Reese
Frank M. Brown
Donald M. McCurdy
Michael Healey
01- 033 -C2
Order No. 1261
12/4/02
12/16/02
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Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter 11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.
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Page 2
I. ALLEGATION:
That B. Edward Smith, a public official /public employee, in his capacity as Manager for
the Blairsville Borough and Blairsville Municipal Authority violated Section 1103(a) of the
Public Official and Employee Ethics Law, 65 Pa.C.S. §1103(a), when he used the authority of
his office for a private pecuniary benefit by utilizing borough employees and equipment for
personal use; and when he utilized funds received by the borough from its insurance carrier to
pay for damages to a vehicle which Smith caused while performing services of a personal
nature.
II. FINDINGS:
1. Barry Edward Smith (B. Edward) served as Executive Director of the Blairsville
Municipal Authority from January 1988 through the present.
a. Smith simultaneously served as both Executive Director of the Authority and
Blairsville Borough Manager from January 1988 until January 3, 2000.
2. While employed as both borough manager and authority executive director, Smith
allocated his time between the Borough and Authority as the workload dictated.
a. Smith generally worked 9:00 a.m. — 5:00 p.m.; and was on call 24 hours a day.
b. Smith had flexibility in his schedule because of his on call status.
c. Smith is a salaried employee.
3. Smith is assigned an Authority vehicle which he has been permitted to use for personal
use.
a. Beginning in 2000 when the Authority purchased a new vehicle for Smith, the
board limited Smith's personal use of the vehicle.
4. While holding both positions, Smith was responsible for all aspects of the operation of
the Borough and Authority.
a. Smith continues to be responsible for all aspects of the operation of the
Authority.
1. Since January 2000, Smith has had no responsibility for borough
operations.
5. The Borough and Authority have traditionally shared employees, which include: a water
plant operator; 2 sewer plant operators; 2 refuse workers; 2 public works
laborers /equipment operators and a foreman; and 3 clerical employees.
a. Employee wages are billed to the Borough or Authority depending on the
respective entity for which the work was performed.
b. The Borough issues the payroll checks after the Authority pays its share of the
wages to the Borough.
6. The Borough and Authority have also traditionally shared equipment.
a. Each entity owns specific equipment.
b. Maintenance and insurance are paid by the entity owning equipment.
Smith 01- 033 -C2
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c. No written agreement exists in relation to the sharing of equipment.
7. In or about 1999, Public Works employees, while on Borough /Authority time, using
Borough and Authority equipment transported an outdoor playhouse to Smith's
daughter's house.
a. The playhouse was moved from 112 East Ranson Street to 533 Maple Avenue
in the borough, an approximate roundtrip distance of 2.3 miles.
b. Public Works employees Ronald Sabedra, Herb Pizer, Paul Cribs, Ronald
Sabedra, Water Plant Operator, and Joseph Spiaggi, road foreman, were used
for this project.
8. The Public Works employees and the Water Plant Operator spent 2.5 hours moving
the playhouse.
a. The Authority backhoe was used to transport the playhouse.
b. Borough /Authority trucks were used to transport the employees and to direct
the backhoe driver along the road.
9. All of the employees were on Borough /Authority time when moving the doll house.
10. The Public Works employees were compensated as follows during this project:
Employee Hourly Rate Time Total
Ron Sabedra $12.15 /hour 2.5 hours $ 30.38
Herb Pizer $11.35 /hour 2.5 hours $ 28.43
Joseph Spiaggi $12.87 /hour 2.5 hours $ 32.18
Paul Cribs $11.94 /hour 2.5 hours $ 29.85
Total Labor $ 120.84
Backhoe Rental $50.00 /hour
Total:
2.5 hours
Total Equip.
$ 125.00
$ 125.00
$ 245.84
11. During the summer of 2000, borough employee Herb Pizer delivered a load of river
rock to Smith's house to spread around a swimming pool recently installed by Smith.
a. Pizer was hauling recyclable materials to the Recycling Center of Indiana
County in Homer City, PA, on that day.
1. The recycling center is 13.8 miles from the Borough /Authority garage.
12. Smith asked Pizer to pick up river rock at Corte Masonry, Indiana, PA, and haul it to
Smith's house.
a. Smith informed Pizer that he would pay for the stone.
b. Pizer waited at Corte Masonry for a period of time until Smith arrived to pay for
the stone.
c. Corte Masonry is located 16.5 miles from the borough /authority garage.
d. Pizer hauled the River Rock to Smith's house in the borough 5 -ton dump truck.
Smith 01- 033 -C2
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e. Pizer spent a minimum of one hour of authority time in relation to the hauling of
the river rock.
f. Corte Masonry charges a $35.00 delivery fee to the Blairsville area.
13. Smith did not pay the following costs that were associated with the delivery of the
stone:
a. Delivery Fee: $35.00
b. Pizer's Time (1 hour): $11.35
Total: $46.35
14. On November 30, 1999, and December 7, 1999, Smith asked employees to unload
drywall at his home.
a. Two employees assisted Smith on each occasion.
b. Each time the employees spent approximately one -half hour to an hour
unloading the drywall.
c. Employees used authority vehicles to travel to Smith's residence.
1. Smith lives approximately 1/2 mile from the Borough /Authority garage.
15. On November 30, 1999, at approximately 2:26 p.m. Smith purchased 10 sheets of
drywall from Lowes.
a. The purchase was made during Smith's regular working hours for the authority.
b. Spiaggi's truck was used by Smith to pick up the drywall.
1. Smith utilized Spiaggi's vehicle which had a covered bed to serve as
protection for the drywall in case of rain or snow.
c. Smith called the borough building and asked that public works employees assist
unloading the drywall at his house.
d. Joseph Spiaggi and Herb Pizer left the job they were working on to unload
Smith's drywall.
e. Smith, Spiaggi and Pizer were on Borough /Authority time during the purchase
by Smith and the delivery.
16. Smith purchased a second quantity of drywall (gypsum) from Lowe's Indiana store on
December 7, 1999 at 1:35 p.m.
a. A total of 7 sheets of 4x8 drywall was purchased by Smith who paid cash for the
items.
b. Smith utilized the pick -up truck of road foreman Joseph Spiaggi to transport the
drywall.
1. Spiaggi's vehicle was utilized because it had a covered bed.
c. Indiana is approximately 30 minutes (19.2 miles) from the Borough /Authority
Smith 01- 033 -C2
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offices.
d. Smith did not return to Blairsville until approximately 2:30 p.m.
17. Upon arriving at his residence, Smith called Road Foreman Joseph Spiaggi and asked
for assistance unloading the drywall from the truck into his basement.
a. Employees Spiaggi, Herb Pizer and Paul Cribbs left the job they were working
on to unload Smith's drywall.
b. Pizer and Cribbs were on Borough /Authority time, at the time of the purchase
and delivery of the drywall.
c. The incident occurred mid - afternoon, between 2:30 p.m. and 3:00 p.m. and took
approximately one hour to complete.
18. Borough /Authority employees were compensated as follows for transporting and
unloading drywall for Smith.
11/30/99: Pizer $11.37/hr x 1 hour = $ 11.37
Spiaggi: $12.87/hr x 1 hour = $ 12.87
12/07/99: Pizer $11.37/hr x 1 hours = $ 11.38
Cribs: $11.37/hr x 2 hours = $ 22.74
Total $ 58.36
19. Smith used Foreman Joseph Spiaggi's personal vehicle to pick up drywall at Lowe's,
Indiana, PA, on November 30, 1999, and December 7, 1999, because Spiaggi's
personal vehicle, a Ford F250 pickup truck, is equipped with a cap over the bed.
a. Smith utilized Spiaggi's truck because the enclosed bed would protect the
drywall from inclement weather.
20. When Spiaggi's truck was returned to the Borough /Authority garage on December 7,
1999, damage to the driver's side back panel of Spiaggi's truck was observed by
employee Herb Pizer
a. Pizer notified Spiaggi of the damage who subsequently discussed the damage
with Smith.
21. On or about December 7, 1999, Smith notified the borough's vehicle insurance agent,
the Graff Agency, that employee Joseph Spiaggi's personal vehicle had been
damaged.
a. Smith spoke to Robert Graff by telephone.
b. Smith claimed the vehicle had been damaged while being utilized for borough
business.
22. Graff completed an Automobile Loss Notice while on the phone with Smith. The
information provided was as follows:
Location of Accident: Lowe's Lumber Yard, Indiana.
Description of Accident:
Borough Manager borrowed employee's personal
pickup truck to go get stuff for borough at lumber
yard. Someone scraped side of truck while in
lumberyard parking lot.
Smith 01- 033 -C2
Page 6
Description of Damage:
Person to Contact:
Date of Accident:
a. Graff completed the Loss Claim Form as Smith relayed the information to him.
23. Smith was not conducting Borough /Authority business at Lowe's on December 7, 1999.
a. No borough /authority business was transacted at Lowes on December 7, 1999.
24. The Borough /Authority vehicle insurance coverage through St. Paul Fire & Marine
Insurance Company covered vehicles not owned by the Borough /Authority, if the
vehicles were being used to conduct Borough /Authority business.
a.
b.
Drivers side scraped. $800.00.
Ed Smith, Boro Mgr.
Borough mgr's truck wouldn't start.
12/7/92, p.m.
The policy included a $250.00 deductible.
The policy did not cover non -owned vehicles used in the conduct of personal
business.
25. A claim was filed against Policy #GP09000306, in the name of the Borough of
Blairsville based on the information Smith provided to Graff.
a. Smith's information alleged the vehicle was being used for borough business.
26. St. Paul Fire & Marine Insurance Company issued check #623005105 on
January 7, 2000, to the Borough of Blairsville in the amount of $1,600.02.
a. The check was received at the Borough /Authority office after 1/7/00.
b. The Borough was not required to pay the deductible.
c. The check was issued based on the description of the accident supplied by
Smith.
27. Smith, in his position as authority manager, signed check #623005105 over to Joseph
Spiaggi by writing on the back "Paid to the order of Joseph Spiaggi".
a. The check was not deposited into a Borough or Authority account.
b. No record of the receipt of the check is contained in the Borough or Authority
records.
Smith was not Borough Manager at the time he negotiated the check.
Spiaggi signed the back of the check and deposited it into his personal account
at S &T Bank.
c.
d.
28. As a result, Smith did not turn the claim in to his personal auto insurance carrier.
29. On at least two occasions in 1999 and 2000 Smith asked Public Works employee
Ronald Sabedra to deliver appliances to his and his daughter's homes on Authority
time using the Authority vehicle assigned to Sabedra.
Smith 01- 033 -C2
Page 7
30. On the first occasion, Smith asked Sabedra to drive him to Johnstown, PA, to pick up a
new stove for Smith's house.
a. The exact date of the incident is not known.
b. Johnstown is 42.9 miles from the Borough /Authority office with an approximate
travel time of one hour.
c. Smith and Sabedra left Blairsville between 10:00 a.m. and 12:00 noon.
d. The pick up and deliver of the stove took approximately 2.5 hours.
e. Smith unloaded the stove at Smith's house.
31. The day after Smith asked Sabedra to drive him to Johnstown, Sabedra returned to
Smith's house to remove the old stove and hook up the new stove.
a. Sabedra was on Authority time.
b. The incident took approximately 1/2 hour.
c. Sabedra used the Authority vehicle assigned to him to travel to Smith's house.
32. On January 24, 2000, Smith asked Ronald Sabedra to unload a new stove and
microwave from Smith's Authority vehicle into Smith's daughter's house.
a. Smith picked up the stove and microwave and delivered it to his daughter's
house using the Authority vehicle.
b. The following day Sabedra removed the old stove and transported it to the
recycling site at the Borough /Authority garage.
1. Sabedra transported the old stove in his Authority vehicle.
c. Both trips to Smith's daughter's house took approximately one hour each.
33. Ronald Sabedia was compensated as follows by the Borough /Authority for the time
involved in transporting the stoves:
Pick up and deliver new stove for Smith 2.5 hours $12.15 = $ 30.38
New stove hook up 5 hours hours = $ 6.08
New stove for daughter 2.0 hours @ $12.40 = $ 24.80
Total $ 61.26
III. DISCUSSION:
At all times relevant to this matter, the Respondent, B. Edward Smith, hereinafter
Smith, 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 se ., as codified by the Public
Official and Employee Ethics Act, Act 93 of 1998, Chapter 11, 65Pa.C.S. § 1101 et seq.,
which Acts are referred to herein as the "Ethics Act."
The allegations are that Smith, as Manager for the Blairsville Borough and Blairsville
Municipal Authority, violated Section 1103(a) of the Ethics Act when he utilized borough
employees and equipment for personal use; and when he utilized funds received by the
borough from its insurance carrier to pay for damage to a vehicle which was used by Smith for
Smith 01- 033 -C2
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personal services.
Pursuant to Section 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 93 of 1998 as follows:
Section 1102. Definitions
"Conflict" or "conflict of interest." Use by a public official
or public employee of the authority of his office or employment or
any confidential information received through his holding public
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
"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 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.
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.
Smith has served as the Executive Director of the Blairsville Municipal Authority (BMA)
and as Manager for Blairsville Borough from January 1988 to January 2000. As Executive
Director of BMA, Smith has a municipal vehicle which he may also use to a limited extent for
personal purposes.
In 1999 during government working hours, Public Works employees and municipal
equipment were utilized to transport an outdoor playhouse to Smith's daughter's home. The
total compensation that was paid to those employees for the approximately 2% hours of time in
moving the playhouse amounted to $245.84.
During the summer of 2000, a borough employee delivered a load of river rock to
Smith's house for spreading around a swimming pool that he installed. The employee hauled
the stone to Smith's house in a borough 5 -ton dump truck. Based upon a standard delivery
charge plus one hour time of the municipal employee, the cost equivalent of such service was
$46.35 which Smith did not have to pay.
In another instance in November of 1999, Smith directed two municipal employees to
unload drywall at his home. In December, Smith purchased a second quantity of drywall and
used the road foreman's private truck for hauling the drywall to his house. The drywall was
not transported in a municipal vehicle because the road foreman's truck was equipped with a
cap over the bed to protect the drywall. In addition, Smith asked the road foreman and two
other municipal employees to assist in unloading the drywall at his residence which was done
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during government working hours. The compensation that the municipal employees received
during the time they unloaded Smith's drywall amounted to $58.36.
When the road foreman's truck was returned to the municipal garage after the drywall
hauling, there was damage to the driver's side panel. Smith notified the borough's vehicle
insurance agent that the road foreman's personal vehicle had been damaged. Smith did not
turn the claim in to his own auto insurance carrier but prepared and submitted a claim to the
borough insurance carrier based upon his assertion that the personal vehicle was damaged on
borough business. The BMA/borough vehicle insurance policy provided for a $250 deductible
as to damage that occurred on borough business but not personal business. Subsequently,
the insurance company submitted a check to the borough in the amount of $1,602, without the
$250 deductible. Smith signed the check and endorsed the check over to the road foreman.
On at least two occasions in 1999 and 2000, Smith asked municipal employees to
deliver appliances to his and his daughter's homes during government working hours in a
municipal vehicle. In the first instance, Smith asked a municipal employee to drive him to
Johnstown to pick up a new stove for his own home. In that Johnstown was over 40 miles
away, the pick -up and delivery took approximately 2% hours. The next day Smith asked the
employee to remove the old stove from Smith's home and hook up the new stove. The
employee used a municipal vehicle during government hours to perform that task which took
approximately one half hour.
In January of 2000, Smith asked a municipal employee to unload a new stove and
microwave from Smith's BMA vehicle into his daughter's house. The employee picked up the
stove and microwave which he delivered to Smiths daughter's house. On the following day
the employee removed the old stove and transported it to the recycling site. The two trips to
Smith's daughter's house took approximately one hour each time. The compensation of the
employee for the time that he spent transporting the stoves amounted to $61.26.
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 proposes that this Commission find that Smith:
violated Section 1103(a) Ethics Act when he utilized borough employees and equipment for
personal use; and did not violate Section 1103(a) of the Ethics Act when he utilized funds
received by the borough insurance carrier to pay for damages to a vehicle which he caused
while performing services of a personal nature in that no specific financial gain was obtained
by Smith as either his or the vehicle owner's insurance would have paid the claim for the
damage to the vehicle. In addition, Smith agrees to make payment in the amount of $1,000.00
to Blairsville Municipal Authority through this Commission within 30 days of the mailing of this
Order.
In applying Section 1103(a) of the Ethics Act to the stipulated facts, we find that there
were numerous uses of authority of office on the part of Smith. But for the fact that he was
Executive Director of the BMA and Borough Manager, he would not have been in a position to
direct borough employees to do various personal work for him and his daughter. In addition,
Smith would not have been able to submit an accident report to the municipal insurance carrier
which misstated the circumstances of the accident as to the borough employee's truck which
was being used to transport drywall to Smith's personal residence. Lastly, there were many
instances where Smith gave directions to borough employees to do work on municipal time for
his own personal purposes: moving a playhouse to his daughter's house, transporting river
rock to spread around his pool, unloading drywall at his home and transporting stoves at both
Smith's and Smith's daughter's residences. All such actions were uses of authority of office.
See, Juliante, Order 809. Such uses of authority of office resulted in private pecuniary
benefits to Smith and his daughter who is a member of his immediate family as that term is
defined under the Ethics Act. The pecuniary benefits were private because there is no
provision in law which would allow Smith to utilize borough equipment and personnel during
Smith 01- 033 -C2
Page 10
government office hours and at government expense to perform work of a personal nature for
Smith and a member of his immediate family. Because the BMA/borough paid for the borough
employees during working hours to perform personal tasks for Smith, he did not have to
personally pay for such services and received private pecuniary benefits as a consequence.
See, Hes�sin e Order 931, affirmed in part R.H. vs. SEC, 673 A.2d 1004 (Pa. Commw.
1996), No. 1732 C.D. 1994. Accordingly, Smith violated 1103(a) of the Ethics Act when he
used borough employees and equipment for personal purposes.
As to the matter of the damage that was done to a borough employee's personal
vehicle which Smith used to transport drywall to his own residence, Smith falsified the borough
insurance claim by stating that the damage to the employee's personal vehicle occurred on
borough business when in fact it occurred during Smith's usage for his own private purposes.
Smith misstated the claim because the borough's insurance carrier would not pay for damage
on a personal vehicle which was not being used in furtherance of municipal business.
However, the stipulation reflects that Smith did not obtain a financial gain because either the
insurance carrier of the vehicle owner or Smith's own insurance carrier would have had to pay
the claim. Assuming that there is no attempt to violate the Ethics Act, there can be no violation
of Section 1103(a) of the Ethics Act without a private pecuniary benefit. Accordingly, Smith
did not violate Section 1103(a) of the Ethics Act regarding the damage to a borough
employee's private vehicle relative to Smith's use of that vehicle for personal purposes in that
either's insurance carrier would have had to pay the claim.
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, Smith is directed to make payment of
$1,000 payable to Blairsville Municipal Authority through this Commission within 30 days of
the issuance 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. Smith, as a Manager for the Blairsville Borough and Blairsville Municipal Authority, was
a public employee subject to the provisions of Act 9 of 1989 as codified by Act 93 of
1998.
2. Smith violated Section 1103(a) Ethics Act when he utilized borough employees and
equipment for personal use consisting of moving a playhouse to his daughter's house,
transporting river rock to spread around his pool, unloading drywall at his home, and
transporting stoves at both Smith's and Smith's daughter's residences.
3. Smith did not violate Section 1103(a) of the Ethics Act regarding the damage to a
borough employee's private vehicle relative to Smith's use of that vehicle for personal
purposes in that either's insurance carrier would have had to pay the claim.
In Re: B. Edward Smith
ORDER NO. 1261
File Docket: 01- 033 -C2
Date Decided: 12/4/02
Date Mailed: 12/16/02
1. Smith, as a Manager for the Blairsville Borough and Blairsville Municipal Authority,
violated Section 1103(a) Ethics Act when he utilized borough employees and
equipment for personal use consisting of moving a playhouse to his daughter's house,
transporting river rock to spread around his pool, unloading drywall at his home, and
transporting stoves at both Smith's and Smith's daughter's residences.
2 Smith did not violate Section 1103(a) of the Ethics Act regarding the damage to a
borough employee's private vehicle relative to Smith's use of that vehicle for personal
purposes in that either's insurance carrier would have had to pay the claim.
3 Per the Consent Agreement of the parties, Smith is directed to make payment of
$1,000 payable to Blairsville Municipal Authority through this Commission within 30
days of the issuance 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