Loading...
HomeMy WebLinkAbout1269 O'ConnorIn Re: Kevin O'Connor 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 02- 001 -C2 Order No. 1269 2/27/03 3/5/03 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 not filed and a hearing was deemed waived. The record is complete. Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter 11 of Act 93 of 1998, 65 Pa.C.S. § 1101 et seq., which essentially repeats Act 9 of 1989 and provides for the completion of pending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. O'Connor 02- 001 -C2 Page 2 I. ALLEGATIONS: That Kevin O'Connor, a (public official /public employee) in his capacity as Executive Director of the Luzerne Intermediate Unit violated the following provisions of the State Ethics Act (Act 93 of 1998) when he used the authority of his office for a private pecuniary benefit by using LIU facilities, including but not limited to a computer lab and related equipment, supplies and personnel to assist his teaching courses and receipt of compensation from Wilkes College and Temple University; when he failed to file Statements of Financial Interests for the 1997, and 1999 calendar years by May 1 S of each year; when he subsequently submitted backdated forms for calendar years 1997, 1998 and 1999; when he failed to file a Statement of Financial Interests for the 2000 calendar year by May 1, 2001; and when he failed to disclose sources of income in excess of $1,300 on Statements of Financial Interests filed for the 1997, 1998 and 1999 calendar years. Section 311103. 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)/65 Pa.C.S. § 1103(a). Section 211102. 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. The term does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 P.S. § 402/65 Pa.C.S. § 1102. Section 411104. 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, 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 O'Connor 02- 001 -C2 Page 3 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 511105. Statement of financial interests (b) Required information. - -The statement shall include the following information for the prior calendar year with regard to the person required to file the statement: (5) The name and address of any direct or indirect source of income totaling in the aggregate $1,300 or more. However, this provision shall not be construed to require the divulgence of confidential information protected by statute or existing professional codes of ethics or common law privileges. 65 P.S. § 405(b)/65 Pa.C.S. § 1105(b). II. FINDINGS: 1. The Investigative Division of the State Ethics Commission received information alleging that Kevin O'Connor violated provisions of the State Ethics Act (Act 93 of 1998). 2. Upon review of the complaint the Investigative Division initiated a preliminary inquiry on January 4, 2002. 3. The preliminary inquiry was completed within sixty days. 4. On March 5, 2002, a letter was forwarded to Kevin O'Connor, by the Investigative Division 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. 7001 0360 0001 4061 5093. b. The domestic return receipt bore the signature of Kevin O'Connor, with a delivery date of March 16, 2002. 5. On January 25, 2002, the Investigative Division of the State Ethics Commission filed an application for a ninety day extension of time to complete the Investigation. 6. The Commission issued an order on July 1, 2002, granting the ninety day extension. 7. Periodic notice letters were forwarded to Kevin O'Connor in accordance with the provisions of the Ethics Law advising him of the general status of the investigation. 8. The Investigative Complaint was mailed to the Respondent on November 27, 2002. 9. Kevin M. O'Connor was employed by the Luzerne Intermediate Unit (LIU) from March 19, 1973, to May 10, 2000. a. While employed by the LIU, O'Connor held the following positions: O'Connor 02- 001 -C2 Page 4 1. Executive Director - November 14, 1989, to May 10, 2000. 2. Acting Executive Director - September 5, 1989, to November 13, 1989. 3. Assistant Executive Director - December 1, 1976, to September 5, 1989. 4. Director for Non - Public Schools - March 19, 1973, to December 1, 1976. 10. O'Connor's tenure as executive director of the LIU was comprised of three four -year appointments beginning on November 14, 1989, and two re- appointments by the LIU board. a. No formal contract existed between O'Connor and the LIU Board. 11. On May 10, 2000, O'Connor was placed on leave with pay by the LIU board as a result of matters that had come to the board's attention, including questions whether O'Connor had provided accurate and timely information to the board. a. On December 27, 2000, O'Connor entered into a settlement agreement with the LIU which included a paid leave of absence for the remainder of his contract with the LIU, which expired on November 13, 2001. 12. The Luzerne County Intermediate Unit No. 18 is one of twenty -nine (29) units established by the Public School Code to provide planning, instructional and other special educational services to groups of school districts within a designated geographic area of each intermediate unit. a. LIU No. 18 is the intermediate unit for approximately twenty -eight (28) school districts in Luzerne County. b. The LIU #18 receives funding from the Commonwealth for services performed pursuant to and authorized by law. c. The chief governing board of the LIU is a board of directors chosen from among members of the boards of school districts which comprise the intermediate unit. d. The board of directors' responsibilities include the power and duty to appoint an executive director, adopt a program of services and a budget and to provide for and conduct services. 13. O'Connor's duties as executive director of LIU #18 included but were not limited to the following: a. To administer the intermediate unit program of services. b. To appoint professional staff subject to the approval of the intermediate unit board of directors. c. To employ nonprofessional staff in accordance with employment policies of the intermediate unit board of directors. d. To prepare the budget for adoption by the intermediate unit board of directors. e. To direct expenditures of funds within the budget or other authorization of the intermediate [sic] board of directors. O'Connor 02- 001 -C2 Page 5 f. To appoint such advisory groups as will assist the staff in providing programs of services for school districts. g. To provide the Superintendent of Public Instruction with information, reports, and services. h. To perform such other duties as may be required by the intermediate unit board of directors and the regulations of the State Board of Education. 14. Since at least 1995, Temple University, Philadelphia, PA, offered graduate school courses in their [sic] Master of Education and Doctor of Education programs at Kings College in Wilkes-Barre. a. Dr. James Powell served as the program coordinator for Temple University. b. Powell recruited personnel from the various school districts and intermediate units in the Wilkes -Barre area to teach the courses. 1. The LIU is located in Kingston, PA. 15. In 1995 Powell and O'Connor discussed O'Connor teaching courses for Temple. a. Powell offered O'Connor a teaching position in the program. 16. Temple University's agreement with O'Connor provided for the university to compensate O'Connor in the amount of $3,000 for each class he taught. 17. Documentation on file at Temple University confirmed O'Connor entered into contracts with Temple on the following dates to teach courses for Temple at Kings College: February 21, 1997 October 8, 1998 February 22, 1999 January 31, 2000 September 22, 2000 February 23, 2001 October 2, 2001 February 13, 2002 18. Classes offered by Temple were held at Kings College which is located in Wilkes - Barre. a. Temple University's agreement with Kings College required Temple to compensate Kings $750, per semester, for the use of each classroom, and $750, per semester, for administrative work. 19. Kings College assigned classroom space for the following courses O'Connor was scheduled to teach for Temple University: Semester Course Description and Number Spring 1997 Introduction to Administration and Supervision — EA500 Fall 1997 Personnel Administration — EA661 Spring 1998 Introduction to Administration and Supervision — EA500 Fall 1998 Personnel Administration — EA661 Spring 1999 Introduction to Administration and Supervision — EA500 Fall 1999 Personnel Administration — EA661 Spring 2000 Introduction to Administration and Supervision — EA500 O'Connor 02- 001 -C2 Page 6 Fall 2000 Spring 2001 Fall 2001 Spring 2002 20. O'Connor used the facilities, employees, supplies and equipment of the LIU for the benefit of his teaching position with Temple. a. O'Connor changed the classroom space from Kings College to rooms at the LIU. b. O'Connor directed the use of subordinate LIU personnel and use of LIU equipment and supplies to perform administrative functions for him in support of his teaching position. 21. Beginning in 1998, O'Connor taught the first class of the semester at Kings College and then moved the courses to the LIU facility where O'Connor held classes for the remainder of the semester. a. This occurred with every class taught by O'Connor between 1998 and 2001. b. O'Connor moved the classes to the LIU because he preferred the LIU facilities to those at Kings. 22. O'Connor never sought, nor was given approval by the LIU board of directors to use the LIU facilities or staff when teaching courses for Temple. a. b. Personnel Administration — EA661 Introduction to Administration and Supervision — EA500 School Law EA681 Introduction to Administration and Supervision — EA500 LIU policy requires employees to submit a room reservation request when seeking to use LIU space. The LIU did not give approval to O'Connor for use of facilities or staff. 23. O'Connor never obtained the approval of the LIU board of directors to teach graduate courses for Temple. 24. The Public School Code, Section 10 -1007 provides that an executive director of an intermediate unit may receive compensation for services devoted to the training of teachers if he is released for such service by the board of directors of the district in which he is employed. a. O'Connor never obtained any such release from the LIU Board. 25. Sometime after starting the first course with Temple, O'Connor informed Board President Ernest Ashbridge that he was teaching the courses for Temple. a. O'Connor did not seek Ashbridge's or the board's approval prior to starting the classes. b. O'Connor did not advise Ashbridge that he was using the LIU facilities to teach the courses and that he was using employees, supplies and equipment to perform administrative functions. 26. Susan Stubodzian served as secretary for O'Connor from July 1, 1994, to May 10, 2000. a. O'Connor used Stubodzian for administrative duties related to his teaching position on a weekly basis for at least two hours each week. O'Connor 02- 001 -C2 Page 7 b. Stubodzian performed these duties during her regular working hours for the LIU. c. Stubodzian used equipment and supplies of the LIU when performing these tasks. 27. Stubodzian was directed by O'Connor to maintain records and to correspond with at least 187 students, and Temple University, during the time period O'Connor taught the courses. a. Stubodzian mailed grades to students, sent letters to students using LIU stationary, envelopes and postage. b. O'Connor directed Stubodzian to maintain course files and student information on the LIU computer in her office. 1. The information entered on and maintained by Stubodzian included course syllabuses, student information including grades, correspondence to students containing grades, letters of recommendation for students, and correspondence to Temple University in relation to the courses O'Connor taught at the LIU for Temple. c. Stubodzian was required to enter new information for each semester O'Connor taught in 1997, 1998, 1999 and 2000. 28. From 1997 until leaving his position with the LIU in May 2000, O'Connor used Stubodzian's office at the LIU to store documents related to the courses he taught at the LIU for Temple University. 29. Temple University did not compensate the LIU for use of the facilities, LIU employees or supplies. a. O'Connor did not reimburse the LIU for use of space, employees or supplies. 30. During the period from 1997 through the spring of 2000 when she performed duties related to O'Connor's teaching position, Stubodzian was paid the following hourly rates: a. 1997 1998 1999 2000 $14.92 $14.92 $16.53 $17.27 31. Stubodzian worked at least two (2) hours each week on matters relating to O'Connor's teaching position with Temple every semester from 1997 to spring 2000. a. Each semester lasted 15 weeks. 32. Stubodzian performed administrative duties for O'Connor's private teaching position at least the following number of hours: a. 1997: 2 semesters x 15 weeks x 2 hours each week = 60 hours b. 1998: 2 semesters x 15 weeks x 2 hours each week = 60 hours c. 1999: 2 semesters x 15 weeks x 2 hours each week = 60 hours O'Connor 02- 001 -C2 Page 8 d. 2000: 1 semester x 15 weeks x 2 hours each week = 30 hours 33. Costs of O'Connor's use of Stubodzian to perform administrative duties related to his private teaching position totaled as follows: a. 1997: 60 hours x $14.92 /hour = $ 895.20 b. 1998: 60 hours x $14.92 /hour = $ 895.20 c. 1999: 60 hours x $16.53 /hour = $ 991.80 d. 2000: 30 hours x $17.27 /hour = $ 518.10 Total: $ 3,300.30 34. O'Connor utilized LIU letterhead and envelopes to correspond with students and to mail grades at the end of each semester. a. O'Connor mailed grades to at least 187 students from 1997 to 2000. 1. The average cost of postage during this period was $.34. 2. Postage costs to mail student grades totaled at least $63.58 (187 students x $.34). 35. Use of the LIU facilities by O'Connor to teach the graduate courses was at least $750.00 per semester. a. Temple paid Kings $750.00 /semester for each class for use of Kings facilities. b. O'Connor used LIU facilities to teach courses for Temple for at least five (5) semesters between 1998 and 2000. c. The LIU classrooms were used exclusively for the benefit of O'Connor. d. Costs for the use of these facilities would be $3,750.00 ($750.00 /semester x 5 semesters). 36. Wage and Tax Statements on file at Temple University confirm O'Connor was compensated the following amounts for teaching the courses on behalf of Temple University. Year Amount 1997 $ 9,000.00 1998 $ 4,800.00 1999 $ 6,000.00 2000 $ 6,000.00 2001 $ 6,000.00 2002 $ 3,000.00 Total $ 34,800.00 37. O'Connor received a private pecuniary gain of at least $7,113.88 when he used the facilities, equipment, supplies and employees of the LIU in furtherance of teaching courses for Temple University. a. Stubodzian Salary: $ 3,300.30 b. Postage: $ 63.58 O'Connor 02- 001 -C2 Page 9 c. Facilities: $ 3,750.00 Total: $ 7,113.88 The following findings relate to O'Connor used [sic] his position to obtain a teaching position with Wilkes University. 38. In or about October and November 1998, O'Connor was interested in teaching graduate level courses offered by Wilkes University. a. The purpose was to develop continuing education credits for teachers within the intermediate unit as well as obtaining a part -time position for O'Connor. b. O'Connor wanted the courses to be held at the LIU facilities. c. At that time, Wilkes University provided graduate level courses at five other intermediate units in the Wilkes- Barre /Scrantion [sic] area. 39. In November of 1998 O'Connor contacted Joseph Bellucci, Director of Graduate Teacher Education at Wilkes University, Wilkes- Barre, PA and informed Bellucci that the LIU was interested in working with Wilkes University in order to offer graduate courses at the LIU. 40. O'Connor set up a meeting with Bellucci that was held on November 24, 1998, at the Ramada Inn in Wilkes- Barre, PA. a. LIU Director of Management Services Lynn Makar and LIU Director of Instructional Materials Barbara Law attended the meeting along with O'Connor and Bellucci. 1. Makar and Law, subordinate employees of O'Connor, attended the meeting at O'Connor's direction. 2. Makar and Law were to serve as instructors for courses requiring the use of computers. 41. The meeting included a discussion regarding Wilkes being the credit bearing university of the LIU's graduate continuing education program, as well as O'Connor, Makar and Law teaching the courses. a. Bellucci, on behalf [sic] Wilkes, agreed to offer the courses in order to upgrade the quality of courses offered at the LIU. 1. At this time, the continuing education courses offered by the LIU was [sic] of poor quality. b. The curriculum agreed to by Bellucci would include a variety of special staff development courses, including classroom technology courses, requiring the availability of computers for use by students in the classroom. c. The technology courses being offered by the LIU were modified following the discussion with Bellucci. d. Also discussed was O'Connor's desire to hold classes at the LIU facilities. 42. O'Connor informed Bellucci during the meeting that he was interested in teaching a course in school law for Wilkes University at the LIU. O'Connor 02- 001 -C2 Page 10 43. During the November 24, 1998, meeting, it was also agreed that O'Connor, Makar and Law would teach the Wilkes courses offered at LIU facilities. a. Makar and Law were to teach the computer technology related courses. b. O'Connor was to teach a school law course. c. All courses would be held at LIU facilities. d. Bellucci would not have entered into the agreement with O'Connor to hold Wilkes classes at LIU if only the school law course were to be taught. 44. Prior to November 1998 the LIU did not have a computer classroom with the computer capability to provide the technology courses required by Bellucci. a. Bellucci advised O'Connor that the LIU would need a computer room with current technology in order to host classes at LIU facilities. b. O'Connor informed Bellucci that the LIU was upgrading their [sic] computer room and the new facility would meet the requirements of Wilkes University. c. O'Connor further informed Bellucci that Law and Makar were capable, and willing to teach graduate school courses for Wilkes University at the LIU. 45. Approximately one month prior to scheduling his meeting with Bellucci, O'Connor initiated purchases of computer upgrades for the LIU computer room. a. O'Connor approved purchase orders for computer purchases beginning in October 1998. 1. Computers were received beginning in November 1998 at aboutthetime of O'Connor's meeting with Bellucci. 2. Additional computers were received in December 1998. 46. Payment for these computers was to be made with funds received by the LIU from a Pennsylvania Department of Education (PDE) federal grant program pursuant to the Individuals with Disabilities Education Grant (IDEA). a. IDEA grant funds awarded by PDE are intended for use in programs directly related to school children with special needs, including children with learning disabilities. b. The LIU annually receives IDEA grants. 47. During the 1998 -1999 school year, the LIU received in excess of $2,000,000 in IDEA grant funds. a. Approximately $55,000 of those grant funds were used to purchase computers and related equipment designated as a computer laboratory facility at the LIU. 1. The equipment consisted of 22 computers plus printers, servers, monitors and software. 48. As a result of the November 24, 1998, meeting a verbal agreement was entered into between O'Connor and Bellucci. O'Connor 02- 001 -C2 Page 11 a. The agreement provided that beginning in the spring of 1999 Wilkes would begin to offer graduate level classes at the LIU. 1. Costs were to [sic] $100 per credit hour with courses being three credits. 2. Other costs included a $25.00 fee that students would pay to the LIU for use of the facilities. b. Bellucci entered into the agreement after being made aware by O'Connor that computers were available for use in the graduate courses. c. The computers purchased with grant funds and intended to be used for students with disabilities were utilized, at least in part, for the benefit of teacher continuing education credits for which O'Connor was compensated. 49. In a memo to Mike Lennon, Vice President, Academic Affairs, Wilkes University, Bellucci explained the university's involvement with LIU #18. Bellucci's memo provides, in part, the following: "In January 1999 a program began with IU #18 where we would be the credit bearing University for their [sic] Graduate Continuing Education Credits." I agreed to do this in order to upgrade the quality of the courses offered at the IU. The IU agreed to pay Wilkes University $300 /three credit graduate course and they would apply the instructors' salaries, room charges, advertisement, and any other charges associated with the classes. The IU actually uses grant money to subsidize the cost of the courses. Wilkes will receive $15,600.00 for the courses conducted from January to March. The students taking these courses are not students who are enrolled in Wilkes or who would have taken previous Wilkes courses. They are using the credits for salary increases. With the exception of the courses listed below Wilkes does not offer any courses with similar titles. 50. Beginning in January 1999 Law and Makar began teaching computer technology classes at the LIU. 51. O'Connor entered into a contract with Wilkes on July 12, 1999, to teach a school law course. a. The course was titled School Law, ED 518. b. The course dates were from July 6, 1999, to August 5, 1999. c. The course was held on Tuesdays, Wednesdays and Thursdays from 2:30 p.m. until 5:30 p.m. d. Location of the course is LIU #18 Classroom, Kingston. e. Contracted fee was $3,600.00. 52. O'Connor scheduled the course to commence 30 minutes after the conclusion of his work day. a. Summer hours at the LIU are from 9:00 a.m. to 2:00 p.m. 53. O'Connor entered into a second contract with Wilkes to teach a school law course on O'Connor 02- 001 -C2 Page 12 September 3, 1999. a. This contract was dated August 30, 1999, and signed by O'Connor on September 3, 1999. b. The course was titled School Law ED 518. c. The course dates were from August 30, 1999, through December 6, 1999. d. The course location is listed as IU #18, 3 Floor. e. The course was held on Mondays from 4:30 p.m. to 7:30 p.m. f. Contracted fee was $7,200.00. 54. O'Connor entered into a third agreement with Wilkes on or about January 14, 2000, to teach two courses. a. The contract was dated January 4, 2000, and signed by O'Connor on January 14, 2000. b. The courses were titled Issues in Education ED 514 and School Law ED 518. c. ED 514 was scheduled to be held at the LIU, 3 Floor on Thursdays from 4:30 p.m. to 7:30 p.m. during the period from January 13, 2000, through April 27, 2000. d. ED 514 was scheduled at St. Jude School on Wednesdays from 4:30 p.m. to 7:30 p.m. during the period from January 12, 2000, through April 26, 2000. e. Contracted amount was $7,200 for both courses. 55. After being placed on leave by the LIU board, on May 10, 2000, O'Connor continued to contract with Wilkes utilizing LIU facilities to teach classes for which he was compensated. a. The contract was dated June 13, 2000, and signed by O'Connor. b. The course title was School Law, ED 518. c. The course was scheduled to be held at the LIU Kingston, 3 Floor Room on Tuesdays, Wednesdays and Thursdays from June 27, 2000, through August 1, 2000, during the hours of 2:30 p.m. to 5:30 p.m. d. The contracted fee was $3,600.00. 56. The LIU board of directors did not authorize O'Connor to use LIU facilities to teach the Wilkes courses for which he was compensated. a. O'Connor did not obtain or seek board approval to teach the courses. b. The board was not aware that O'Connor was receiving compensation from Wilkes University for his teaching. 57. LIU policy requires that individuals submit room reservation requests forms when wanting to use LIU facilities. O'Connor 02- 001 -C2 Page 13 a. O'Connor did not submit any requests for use of space when teaching courses in 1999 and 2000. 58. Wilkes University compensated O'Connor as follows for teaching School Law and Issues in Education courses: a. 1999: $10,800.00 b. 2000: $10,800.00 Total $21,680.00 [sic *] 59. O'Connor received a private pecuniary gain of $21,680.00 [sic *] as a result of the use of his public position to obtain contracts with Wilkes University to teach courses using LIU facilities for class space. a. O'Connor, in his capacity as LIU Executive Director, and on behalf of the LIU initiated and authorized the arrangement between the LIU and Wilkes College to offer graduate courses at LIU and for which he subsequently served as an instructor, and received private compensation. b. The contract negotiated by O'Connor was done without LIU board approval and resulted in a private pecuniary gain to him. c. O'Connor, as LIU Executive Director, authorized the use of IDEA grant funds to purchase computers to be used in the continuing education courses. 1. Wilkes University would not enter into a contract with O'Connor without the necessary computer facilities. The following findings relate to the allegation that O'Connor failed to file Statements of Financial Interests and subsequently backdated forms. 60. In December of 2000, investigators of the State Ethics Commission conducted a Statement of Financial Interests Compliance Review at the Luzerne County Intermediate Unit. a. The purpose of the compliance review was to determine whether all covered public officials and public employees serving the Luzerne County Intermediate Unit were filing Statements of Financial Interests in accordance with the requirements of the Public Official and Employee Ethics Law. 61. A review of the records of the Luzerne County Intermediate Unit conducted during the compliance review, indicated that no Statements of Financial Interests were on file for Kevin O'Connor for the calendar years 1997 (required to be filed by May 1, 1998), 1998 (required to be filed by May 1, 1999) and 1999 (required to be filed by May 1, 2000). 62. As a result of the compliance review a notice was forwarded to Kevin O'Connor, 45 Beech Road, Plains, PA 18705, on February 15, 2001, advising O'Connor of the Commission's intent to commence a civil penalty proceeding pursuant to the Ethics Law for his failure to file Statements of Financial Interests for calendar years 1997 through 1999 inclusive. a. O'Connor was advised that as Executive Director of the Luzerne County Intermediate Unit he was a public official required to file Statements of Financial Interests in accordance with the Ethics Law. O'Connor 02- 001 -C2 Page 14 b. O'Connor was advised of the penalties for failure to file and was also provided a twenty (20) day grace period within which he could correct the deficiencies by filing Statements of Financial Interests in accordance with the law. c. O'Connor was provided with blank Statement of Financial Interests forms for completion. 63. O'Connor did not file the required Statements of Financial Interests within the twenty (20) day period of time allotted by the notice of February 15, 2001. 64. On June 28, 2001, copies of Statements of Financial Interests for Kevin O'Connor for calendar years 1997, 1998 and 1999 were received at the offices of the Pennsylvania State Ethics Commission. 65. Statements of Financial Interests filed with the State Ethics Commission by Kevin O'Connor at that time include the following information: a. Calendar year: Dated: Position: Creditors: Direct /Indirect Income: Office, Directorship or Emp. in any Business: All other financial interests: b. Calendar year: Dated: Position: Creditors: Direct /Indirect Income: Office, directorship or Emp. in any business: All other financial interests: c. Calendar year: Dated: Position: Creditors: Direct /Indirect income: Office, directorship or Emp. in any business: All other financial interests: 1997 05/01/97 on SEC Form 1/01 Executive Director UFCW, Local 72 Luzerne Intermediate Unit None None 1998 05/01/97 on SEC Form Rev. 1/01 Executive Director UFCW, Local 72 Luzerne Intermediate Unit None None 1999 05/01/99 on SEC Form Rev. 1/01 Executive Director None Luzerne Intermediate Unit None None 66. The Statements of Financial Interests forms received by the State Ethics Commission from Kevin O'Connor were signed by Kevin O'Connor. 67. The Pennsylvania State Ethics Commission contracts the printing of Statements of Financial Interests annually. a. The State Ethics Commission contracted with Vanguard Printing, Moore Business Forms and Digital Ink Printing Co. in 1997, 1998, 1999, 2000 and 2001 respectively. b. Orders for forms are placed with the printers in December of the preceding year. c. Forms are received by the Administrative Division of the State Ethics O'Connor 02- 001 -C2 Page 15 Commission the December before or January of the filing year. d. Forms are then bulk mailed to each municipality in the Commonwealth of Pennsylvania. 68. Statements of Financial Interests forms were annually mailed to the Luzerne Intermediate Unit No. 18 in 1998, 1999 and 2000 by the Administrative Division of the State Ethics Commission. a. In 1998, blank forms SEC -1, Rev. 1/98 were mass mailed to all municipalities in the Commonwealth, including LIU, on January 26, 1998. b. In 1999 blank forms, SEC -1, Rev. 1/99, were mass mailed to all municipalities in the Commonwealth, including LIU, on February 9, 1999. c. The 2000 forms SEC -1, Rev. 1/00 were bulk mailed to all municipalities in the Commonwealth, including LIU, on January 21, 2000. d. The 2001 forms SEC -1, Rev. 1/01 were bulk mailed to all municipalities in the Commonwealth, including LIU, on or about December 29, 2000. e. The 2002 forms SEC -1, Rev. 1/2002 were bulk mailed to all municipalities in the Commonwealth, including LIU, on or about December 14, 2001. 69. Each year when forms are printed a form identification number is listed in the upper left hand corner of the form. a. Forms printed in 1998 contained an identification of SEC -1 1/98 while forms printed in 1999, 2000, 2001, and 2002 contained identification dates of SEC -1 1/99, SEC -1 1/00, SEC -1 1/01 and SEC -1 1/02 respectively. 70. Prior to 2000, blank Statement of Financial Interests forms were mailed by the State Ethics Commission to the Luzerne Intermediate Unit addressed to Kevin O'Connor, Executive Director, Luzerne Intermediate Unit 18, 368 Tioga Avenue, Kingston, PA 18704 -0649. a. O'Connor as the Chief Administrative Officer for the LIU was responsible for receipt of the blank Statements of Financial Interests forms from the State Ethics Commission, distribution thereof to covered LIU employees and officials and general administration of the filing requirements, for the LIU. b. Blank Statements of Financial Interests were forwarded directly by the State Ethics Commission to O'Connor in his position as LIU Executive Director since at least 1989. c. O'Connor previously opened all mail received at the LIU. 71. The material that was forwarded to O'Connor by the State Ethics Commission each year not only included the blank Statements of Financial Interests forms but also included a cover memo advising of the filing procedures and deadlines. 72. Beginning in 2001, blank SFI forms were mailed by the State Ethics Commission Administrative Division to Michael Ostrowski, Substitute Executive Director, Luzerne Intermediate Unit, P.O. Box 1649, Kingston, PA 18704 -5423, on the dates noted above. a. Instructions for completion are attached to the blank forms. O'Connor 02- 001 -C2 Page 16 73. Kevin O'Connor's Statements of Financial Interests forms for the 1997 calendar year listed the date filed as May 1, 1998. a. The Statement of Financial Interests dated May 1, 1997, signed by Kevin O'Connor was on SEC form 1/01 which was not printed and mailed to municipalities until December 13, 2000. b. This form was not printed or in circulation on May 1, 1997, the date Kevin O'Connor purportedly filed it. c. O'Connor's filing was backdated creating the impression that the form was timely filed. 74. Kevin O'Connor's Statement of Financial Interests for the 1998 calendar year listed the date filed as May 1, 1998. a. b. c. The form, dated May 1, 1998, and signed by Kevin O'Connor was on SEC -1, Rev. 1/01 which was not mailed to municipalities until December 13, 2000. This form was not printed or in circulation on May 1, 1998, the date Kevin O'Connor allegedly filed the form. The form was backdated giving the impression it was timely filed. 75. Kevin O'Connor's Statement of Financial Interests for the 1999 calendar year listed the date filed as May 1, 1999. a. The form, dated May 1, 1999, and signed by Kevin O'Connor was on SEC -1, Rev. 1/01 which was not mailed to municipalities until December 13, 2000. b. This form was not printed or in circulation on May 1, 1999, the date Kevin O'Connor allegedly filed the form. c. The form was backdated giving the impression it was timely filed. 76. O'Connor was not only aware of the Statement of Financial Interests filing requirement as a result of the information that he received from the State Ethics Commission on an annual basis, but he was also aware of the requirement to file Statements of Financial Interests as a result of his service as a trustee on the Bloomsburg University Board of Trustees. a. On January 30, 1996, O'Connor was specifically advised by Jessica S. Kozloff, President of Bloomsburg University of the filing requirement and was specifically advised of the procedures applicable for filing Statements of Financial Interests. b. O'Connor was advised of such specifically by way of letter dated January 30, 1996, at which time he was provided a blank form for filing. 77. Records of the LIU contained a Statement of Financial Interests for Kevin O'Connor dated February 12, 1993, which was filed for calendar year 1992. a. O'Connor was aware of the filing requirement and was aware that he was required to file a Statement of Financial Interests in his position as Executive Director of the LIU at least dating back to February 13, 1993. O'Connor 02- 001 -C2 Page 17 78. Although Kevin O'Connor was well aware that he was required to file a Statement of Financial Interests in accordance with the provisions of the Ethics Law, he failed to file such forms with the LIU for at least calendar years 1997, 1998 and 1999. a. O'Connor's failure to file Statements of Financial Interests with knowledge that he was required to do so, was intentional. 79. O'Connor admitted that he backdated the Statements of Financial Interests. 80. In addition to backdating the Statements of Financial Interests, O'Connor failed to report either Temple University or Wilkes University as sources of income on the forms that he forwarded to the Pennsylvania State Ethics Commission for calendar years 1997 -1999. a. O'Connor was paid as follows by Temple: 1997 1998 1999 $9,000.00 $4,800.00 $6,000.00 b. O'Connor was paid as follows by Wilkes: 1999: $10,800.00 81. O'Connor's failure to report Temple University or Wilkes University on Statements of Financial Interests forms was an intentional omission which was done in order to avoid disclosure of his receipt of income from these entities. a. O'Connor had not received authorization from the LIU board to perform services for these entities as was required by the board. b. O'Connor was utilizing LIU facilities, personnel, equipment and materials in aid of his private employment endeavors with Temple and Wilkes University. 82. O'Connor filed a Statement of Financial Interests for the 2000 calendar year with the State Ethics Commission on February 8, 2002, nine months after the due date. a. The form was required to have been filed by May 1, 2001. b. The form was signed by O'Connor but was not dated. c. The form was filed after the Investigative Division of the State Ethics Commission initiated its inquiry of O'Connor. 1. O'Connor did not file until after he was sent a notice of intent to levy civil penalties for his failure to file on January 25, 2002, by the State Ethics Commission. 83. The Public Official and Employee Ethics Act, Section 1104, Subsection e, provides that "no public official shall be allowed to take the oath of office or enter or continue upon his duties, nor shall he receive compensation from public funds, unless he has filed a Statement of Financial Interests as required by this chapter." 84. During the period of time when he was in non - compliance with the filing requirements of the State Ethics Act, O'Connor continued to be compensated as an appointed public official. O'Connor 02- 001 -C2 Page 18 School Year Amount 1996 -1997 $84,000 1997 -1998 $88,000 1998 -1999 $90,600 1999 -2000 $92,000 2000 -2001 $92,000 85. O'Connor's use of his public position to obtain teaching contracts and his subsequent use of facilities, employees, equipment and supplies of the LIU in furtherance of his private contracts, resulted in a private pecuniary gain of at least $28,793.88 [sic *]. a. Use of personnel, facilities, equipment Temple Contract $ 7,113.88 b. Teaching contracts Wilkes University $ 21,680.00 [sic *] Total $ 28,793.88 [sic *] We note that there is an $80 disparity in Finding 58 that affects other Findings. We shall resolve the $80 disparity in favor of the Respondent. III. DISCUSSION: In his former capacity as Executive Director of the Luzerne Intermediate Unit, Respondent Kevin O'Connor (also referred to herein as "Respondent," "O'Connor," or "Respondent O'Connor ") was a public official /public employee 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 allegations are that O'Connor, as Executive Director of the Luzerne Intermediate Unit (LIU), violated Sections 3(a)/1103(a), 4(a)/1104(a) and 5(b)/1105(b) of the Ethics Act when he used the authority of his office for a private pecuniary benefit by using LIU facilities, including but not limited to a computer lab and related equipment, supplies and personnel to assist his teaching courses and receipt of compensation from Wilkes University and Temple University; when he failed to file Statements of Financial Interests for the 1997, 1998 and 1999 calendar years by May 1s` of each year; when he subsequently submitted backdated forms for calendar years 1997, 1998 and 1999; when he failed to file a Statement of Financial Interests for the 2000 calendar year by May 1, 2001; and when he failed to disclose sources of income in excess of $1,300 on Statements of Financial Interests filed for the 1997, 1998 and 1999 calendar years. We initially note that in a separate order issued this date, we considered and disposed of a procedural issue regarding the Respondent's failure to file a timely Answer to the Investigative Complaint /Findings Report in this case. In this Order, we shall consider the rest of the case. Pursuant to Section 3(a)/1103(a) of the Ethics Act quoted above, a public official /public employee is prohibited from engaging in conduct that constitutes a conflict of interest. Specifically, 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. O'Connor 02- 001 -C2 Page 19 Section 4(a)/1104(a) of the Ethics Act quoted above provides 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. Section 5(b)(5)/1105(b)(5) of the Ethics Act quoted above requires that a public official /public employee disclose on his Statement(s) of Financial Interests the name and address of any direct or indirect source of income totaling in the aggregate $1,300 or more. Having noted the issues and applicable law, we shall now summarize the facts pertaining to this case. Given Respondent's failure to file an Answer to the Investigative Complaint, the facts as averred by the Investigative Complaint are deemed admitted by the Respondent. 65 Pa.C.S. § 1108(e) 51 Pa. Code § 21.5(k). Respondent O'Connor was employed by the Luzerne Intermediate Unit (LIU) from March 19, 1973, to May 10, 2000. O'Connor served as Executive Director of the LIU from November 14, 1989, to May 10, 2000. O'Connor's duties as Executive Director of the LIU were as set forth in Finding 13. Such duties included, inter alia: appointing professional staff, subject to the approval of the LIU Board of Directors ( "LIU Board "); employing nonprofessional staff in accordance with employment policies of the LIU Board; preparing the budget for adoption by the LIU Board; and directing expenditures of funds within the budget or other authorization of the LIU Board. During his employment as Executive Director of the LIU, O'Connor entered into contracts with Temple University ( "Temple ") and Wilkes University to teach education - related graduate courses. As set forth more fully below, O'Connor was compensated for teaching all of these courses. However, Section 10 -1007 of the Public School Code prohibits an executive director of an intermediate unit from receiving compensation for providing teaching services except under certain narrow conditions, which conditions include a requirement that the executive director be released for such service by the board of directors of the district in which he is employed: § 10 - 1007. Not to engage in teaching; exceptions No executive director of the intermediate unit, district, or assistant district superintendent or assistant executive director of an intermediate unit in this Commonwealth shall engage in the business or profession of teaching in this Commonwealth, unless it is done without any other compensation than that paid to him as such superintendent: Provided, That he may receive compensation for services in a summer school, maintained in a State college or university, or other college or university, devoted to the training of teachers, or for services rendered evenings or Saturdays during the school term, to any such college or university, if he is released for such service by the board of school directors of the district in which he is employed. 24 P.S.§ 10 -1007 (Emphasis added). O'Connor never obtained such a release from the LIU Board (Finding 24 a). The material facts pertaining to O'Connor's teaching for Temple are as follows. In 1995, Dr. James Powell served as the program coordinator for Temple's Master of Education and Doctor of Education programs. Powell recruited personnel from the various school districts and intermediate units in the Wilkes -Barre area to teach the courses. In 1995 Powell and O'Connor discussed O'Connor teaching courses for Temple. Powell offered O'Connor 02- 001 -C2 Page 20 O'Connor a teaching position in the program. O'Connor entered into contracts on the following dates to teach courses in Temple's Master of Education /Doctor of Education program(s): February 21, 1997; October 8, 1998; February 22, 1999; January 31, 2000; September 22, 2000; February 23, 2001; October 2, 2001; and February 13, 2002. From 1997 through 2002, O'Connor was compensated by Temple in the total amount of $34,800 for teaching these courses (Finding 36). Sometime after starting the first course with Temple, O'Connor informed LIU Board President Ernest Ashbridge ( "Ashbridge ") that he was teaching the courses for Temple. However, O'Connor did not seek Ashbridge's or the LIU Board's approval prior to starting the classes, and, as noted above, O'Connor never obtained a release from the LIU Board to teach graduate courses for Temple for compensation. Additionally, O'Connor used the LIU facilities to teach these courses and LIU employees, supplies and equipment to perform related administrative functions. Despite the fact that Temple provided classroom space for O'Connor's courses through an agreement with Kings College (Finding 19), beginning in 1998, O'Connor taught the first class of each semester at Kings College and then moved the course to the LIU facility where O'Connor held classes for the remainder of the semester. This occurred with every class taught by O'Connor between 1998 and 2001. LIU policy requires individuals seeking to use LIU facilities to submit room reservation request forms. However, O'Connor never sought, nor was he given, approval by the LIU Board to use the LIU facilities to teach courses for Temple. Additionally, as set forth in Findings 26 -34, O'Connor directed the use of subordinate LIU personnel and the use of LIU equipment and supplies in support of his teaching position. O'Connor directed his LIU secretary to perform administrative duties and to maintain records, course files and student information related to the courses O'Connor taught for Temple. The secretary performed these duties during her regular working hours for the LIU using LIU equipment and supplies. O'Connor also used office space at the LIU for storage and LIU letterhead and envelopes for correspondence related to the courses he taught for Temple. O'Connor never sought, nor was he given, approval by the LIU Board to use the LIU facilities or staff in support of his teaching for Temple (Finding 22). Temple University did not compensate the LIU, and O'Connor did not reimburse the LIU, for the aforesaid use of LIU facilities, employees and supplies. From 1997 to spring 2000 O'Connor received a private pecuniary gain of at least $7,113.88, consisting of his LIU secretary's salary ($3,300.30), postage ($63.58) and facilities ($3,750) used in furtherance of teaching courses for Temple University (Findings 30 -37). In addition to teaching courses for Temple, in November 1998 O'Connor took actions in his capacity as Executive Director of the LIU to secure teaching work for compensation through Wilkes University. O'Connor, in his capacity as LIU Executive Director, initiated and authorized an arrangement between the LIU and Wilkes University to offer graduate courses at the LIU for which O'Connor subsequently served as a compensated instructor. This was done without LIU Board approval. In November of 1998 O'Connor contacted Joseph Bellucci ( "Bellucci "), Director of Graduate Teacher Education at Wilkes University, and informed Bellucci that the LIU was interested in working with Wilkes University to offer graduate courses at the LIU. Such courses at the LIU would provide continuing education credits for LIU teachers. At that time, the continuing education courses offered by the LIU were of poor quality, and Wilkes University was providing graduate level courses at five other intermediate units in the Wilkes- O'Connor 02- 001 -C2 Page 21 Barre /Scranton area. O'Connor set up a meeting with Bellucci. The meeting was held on November 24, 1998. The meeting included O'Connor; Bellucci; the LIU Director of Management Services, Lynn Makar; and the LIU Director of Instructional Materials, Barbara Law. Makar and Law were subordinate employees of O'Connor and attended the meeting at O'Connor's direction. During the meeting, O'Connor informed Bellucci that he was interested in teaching a course in school law and that he wanted the classes to be held at the LIU facilities. The admitted Findings establish that Bellucci would not have entered into an agreement with O'Connor to hold Wilkes classes at LIU if only the school law course were to be taught. Bellucci required a curriculum with a variety of special staff development courses, including classroom technology courses that necessitated having computers in the classroom. Bellucci advised O'Connor that in order to host classes at LIU facilities, the LIU would need a computer room with current technology. O'Connor informed Bellucci that the LIU was upgrading its computer room, and that the new facility would meet the requirements of Wilkes University. O'Connor further informed Bellucci that Law and Makar were willing and able to teach graduate school courses for Wilkes University at the LIU. During or as a result of the November 24, 1998, meeting, a verbal agreement was entered into between O'Connor and Bellucci. Per the agreement, Wilkes would begin to offer graduate level classes at the LIU beginning in the spring of 1999. It was agreed that O'Connor would teach a school law course, and Makar and Law would teach the computer technology related courses. All courses would be held at the LIU facilities. Course costs would include $100 per credit hour and a $25 fee that students would pay to the LIU for use of the LIU facilities. Per the admitted Findings, O'Connor was already in the process of upgrading the LIU computer room prior to his November 1998 contact with Bellucci (Finding 45). Approximately one month prior to scheduling a meeting with Bellucci, O'Connor initiated purchases of computer upgrades for the LIU computer room. New computers were received in November and December of 1998. O'Connor as LIU Executive Director authorized the use of certain government grant funds (see, Findings 46 -47) to purchase the new computers /equipment. Without the new computers /equipment, Wilkes University would not have entered into a contract with O'Connor. The computers /equipment were used, at least in part, for the Wilkes University courses taught at the LIU. O'Connor entered into contracts with Wilkes University on July 12, 1999, and September 3, 1999, to teach school law courses held at the LIU. O'Connor's compensation for teaching these courses totaled $10,800. O'Connor entered into a third agreement with Wilkes University on or about January 14, 2000, to teach courses detailed in Finding 54. O'Connor's compensation for teaching these courses totaled $7,200. On May 10, 2000, O'Connor was placed on leave with pay by the LIU Board as a result of matters that had come to the Board's attention, including questions as to whether O'Connor had provided accurate and timely information to the Board. Even after being placed on leave by the LIU Board, O'Connor entered into a fourth contract with Wilkes University, dated June 13, 2000, to teach a course using the LIU facilities. O'Connor was compensated in the amount of $3,600 under this contract. O'Connor did not obtain or seek approval from the LIU Board to teach any of the above O'Connor 02- 001 -C2 Page 22 courses or to use the LIU facilities for these courses. The LIU Board was not aware that O'Connor was receiving compensation from Wilkes University for teaching. Per the admitted Findings, O'Connor received private pecuniary benefit of $21,600 as a result of the use of his public position to obtain contracts with Wilkes University to teach courses using LIU facilities for class space (Finding 59). The admitted Findings of the Investigative Complaint further establish that O'Connor intentionally failed to timely file Statements of Financial Interests for calendar years 1997 -2000 and that he ultimately filed backdated forms for calendar years 1997 -1999. Additionally, O'Connor failed to report Temple as a source of income for calendar years 1997 -1999 and Wilkes University as a source of income for calendar year 1999. O'Connor's failure to report Temple or Wilkes University as sources of income on the above Statements of Financial Interests was an intentional omission which was done in order to avoid disclosure of O'Connor's receipt of income from these entities (Finding 81). O'Connor filed a Statement of Financial Interests for the 2000 calendar year with the State Ethics Commission on February 8, 2002, nine months after the due date of May 1, 2001. The form was signed by O'Connor but was not dated. The form was filed after the Investigative Division of the State Ethics Commission had initiated its inquiry as to O'Connor and after O'Connor had been notified that civil penalty proceedings would be instituted against him for his failure to file. During the period of time when he was in non - compliance with the filing requirements of the Ethics Act, O'Connor continued to be compensated as Executive Director of the LIU as set forth in Finding 84. Having summarized the facts as deemed admitted by Respondent, we shall consider the factual arguments made by Respondent in his Closing Statement. Respondent contends: (1) As to his failure to obtain the approval /release of the LIU Board to teach for compensation, that he advised the Board President that he had begun teaching for Temple, such that (a) he was not hiding his activities; (b) he intended to properly advise the Board of such activities; and (c) he acted appropriately given that his employment contract itself was oral and not in writing (Closing Statement for the Respondent at 3 -4); (2) As to his failure to obtain LIU approval to use LIU classrooms, that there is no Finding as to (a) whether notifying the LIU Board President was insufficient permission; (b) how other users of LIU classrooms obtained permission; and (c) whether Respondent had authority as Executive Director to approve his own use of facilities "just as he did for any others who asked to use them" (Closing Statement for the Respondent at 4); As to the valuation of his use of the LIU classrooms, that the record is defective in that it: (a) uses as a "benchmark" the value of the King's College facility; (b) fails to establish whether other courses were taught in the LIU classrooms; and (c) fails to establish whether other LIU staff members were permitted to use the classrooms free of charge for courses "within the mission of the LIU" (Closing Statement for the Respondent at 5 -6); (4) As to the benefit derived from his use of the LIU classrooms, that the Findings of the Investigative Complaint conflict given that Paragraph 35 c states, "The LIU classrooms were used exclusively for the benefit of O'Connor," while other paragraphs indicate that the LIU "was engaged in support of teaching classes (3) O'Connor 02- 001 -C2 Page 23 for teachers and that employees other than Respondent O'Connor used the classrooms at the LIU" (see, Investigative Complaint, paragraphs 35 c, 41 a 1, 22 a; Closing Statement for the Respondent at 6); As to the value of his use of staff time and other LIU facilities, that the figures in Findings 33 and 34 of the Investigative Complaint are "suspect" and "should not be accepted blindly by the Commission as it deliberates this matter" (Closing Statement for the Respondent at 7); (6) As to his actions to upgrade the LIU computer facilities, that such actions predated his first meeting with Bellucci of Wilkes University, so that such upgrades were not linked to his hiring by Wilkes University and do not support a finding of a conflict of interest (Closing Statement for the Respondent at 7 -8); and (5) (7) As to his admitted filing of late and backdated Statements of Financial Interests, that (a) although he is bound by findings that his failure to file was intentional, such failure resulted from "sloppiness and inattentiveness" rather than an intentional concealment of facts as to his activities and income; and (b) the filing of backdated forms "more clearly illustrates sloppiness and inattentiveness than a completely irrational and hopeless attempt to fool a Commission which already had notice of his late filing" (Closing Statement for the Respondent at 9). As we conduct our analysis of the above factual arguments of the Respondent, we note that Respondent's failure to file a timely Answer to the Investigative Complaint has resulted in deemed admissions of key facts that he might otherwise have contested through a hearing process. Respondent invites us to determine which individual facts and ultimate factual findings are "supported by the record." (Closing Statement for the Respondent at 2 -3). Respondent appears to be suggesting that we may ignore facts of record if we determine they are not "supported by the record." We question whether facts of record may be argued to be unsupported by the very record of which they are a part. In any event, we are not at liberty to ignore or rationalize away admissions of the parties. See, Bartholomew v. State Ethics Commission, 795 A.2d 1073 (Pa. Cmwlth. 2002). Furthermore, we are not aware of any legal authority supporting Respondent's suggestion that an admission by default is any less an admission than a direct admission (see, Closing Statement for the Respondent at 2). Arguments 1, 2, 3, 5 and 7 above necessarily fail given Respondent's deemed admissions that: (Re: Argument 1) (a) Respondent never obtained the required release from the LIU Board as to teaching for compensation (Investigative Complaint, Findings 24, 24 a); (b) Respondent never obtained the approval of the LIU board of directors to teach graduate courses for Temple (Investigative Complaint, Finding 23); (c) Respondent did not obtain or seek LIU Board approval to teach the Wilkes University courses (Investigative Complaint, Finding 56 a); (d) The LIU Board was not aware that Respondent was receiving compensation from Wilkes University for his teaching (Investigative Complaint, Finding 56 b); ( e) Respondent had not received authorization from the LIU Board to perform services for Temple or Wilkes University as was required by the Board (Investigative Complaint, Finding 81 a); O'Connor 02- 001 -C2 Page 24 (Re: Argument 2) (a) Respondent did not advise LIU Board President Ashbridge that he was using the LIU facilities to teach the Temple courses and that he was using employees, supplies and equipment to perform administrative functions (Finding 25 b); (b) Respondent never sought nor was given approval by the LIU Board to use the LIU facilities or staff when teaching courses for Temple (Investigative Complaint, Findings 22 and 22b); (c) The LIU Board did not authorize Respondent to use LIU facilities to teach the Wilkes courses for which he was compensated (Investigative Complaint, Finding 56); (d) LIU policy requires employees /individuals to submit room reservation request forms when seeking to use LIU space /facilities (Investigative Complaint, Findings 22 a, 57); (e) Respondent did not submit any requests for use of space when teaching courses in 1999 and 2000 (Investigative Complaint, Finding 57 a); (Re: Argument 3) (a) Use of the LIU facilities by Respondent to teach the graduate courses was at least $750.00 per semester (Investigative Complaint, Finding 35); (b) Costs for the use of the LIU facilities for Respondent's courses through Temple would be $3,750.00 ($750.00 /semester x 5 semesters) (Investigative Complaint, Finding 35 d); (Re: Argument 5) (a) Costs of Respondent's use of Stubodzian to perform administrative duties related to his private teaching position totaled as follows: a. 1997: 60 hours x $14.92 /hour = $ 895.20 b. 1998: 60 hours x $14.92 /hour = $ 895.20 c. 1999: 60 hours x $16.53 /hour = $ 991.80 d. 2000: 30 hours x $17.27 /hour = $ 518.10 Total: $ 3,300.30 (Investigative Complaint, Finding 33); (b) Respondent utilized LIU letterhead and envelopes to correspond with students and to mail grades to at least 187 students from 1997 to 2000 (Investigative Complaint, Findings 34 and 34 a); (c) Postage costs to mail student grades totaled at least $63.58 (187 students x $.34) (Investigative Complaint, Finding 34 a 2); (Re: Argument 7) (a) Respondent's failure to file Statements of Financial Interests with knowledge that he was required to do so, was intentional (Investigative Complaint, Finding O'Connor 02- 001 -C2 Page 25 78 a); (b) Respondent's Statement of Financial Interests forms for calendar years 1997, 1998 and 1999 were backdated giving the impression that the forms were timely filed (Investigative Complaint, Findings 73 c, 74 c, 75 c); and (c) Respondent's failure to report Temple or Wilkes University on Statement of Financial Interests forms for calendar years 1997 -1999 as to Temple and 1999 as to Wilkes University was an intentional omission which was done in order to avoid disclosure of his receipt of income from these entities (Investigative Complaint, Findings 80 -81). As for Respondent's Argument 4 above, Finding 35 c must be read in the context of Finding 35 as a whole. When Finding 35 c is read in context, it means that the LIU classrooms when used by Respondent to teach courses for Temple On contrast to the Wilkes University classes), benefited only the Respondent. In contrast to Finding 41 a 1 regarding the Wilkes University courses, there was no indication as to the Temple courses of any purpose of improving the continuing education courses offered at the LIU for LIU teachers. As for Respondent's Argument 6 above, the relevant Findings of the Investigative Complaint would appear to be Findings 59 c and 59 c 1. Although the language of these Findings might be subject to multiple interpretations, we believe that a fair reading of the position of the Investigative Division would be that Respondent's uses of the authority of his position to upgrade the LIU computer facilities put him in a position to enter into the contracts with Wilkes University, which contracts resulted in compensation to him. Neither party disputes that the upgrades commenced before Respondent met with Bellucci, the Wilkes University representative. However, Respondent's proffering of the LIU equipmentffacilitiesto secure contracts with Wilkes University is significant regardless of when the upgrades were commenced. We must now determine whether the actions of O'Connor violated Sections 3(a)/1103(a), 4(a)/1104(a) and /or 5(b)/1105(b)(5) of the Ethics Act. As we apply the facts to the allegations, due process requires that we not depart from the allegations. Penns v. Department of State, 594 A.2d 845 (1991). Based upon our review of the record, we ind that there is clear and convincing evidence to support numerous violations of the Ethics Act under the allegations. Clear and convincing evidence is "testimony that is so 'clear, direct, weighty, and convincing as to enable the trier of fact to come to a clear conviction, without hesitance, of the truth of the precise facts in issue. - In Re: Charles E.D.M., 550 Pa. 595, 601, 708 A.2d 88, 91 (Pa. 1998) (Citation omitted). It is alleged that Respondent O'Connor, as Executive Director of the Luzerne Intermediate Unit (LIU), violated Sections 3(a)/1103(a), 4(a)/1104(a) and 5(b)/1105(b) of the Ethics Act: (1) when he used the authority of his office for a private pecuniary benefit by using LIU facilities, including but not limited to a computer lab and related equipment, supplies and personnel to assist his teaching courses and receipt of compensation from Wilkes University and Temple University; (2) when he failed to file Statements of Financial Interests for the 1997, 1998 and 1999 calendar years by May 1 of each year; (3) when he subsequently submitted backdated forms for calendar years 1997, 1998 and 1999; (4) when he failed to file a Statement of Financial Interests for the 2000 calendar year by May 1, 2001; and (5) when he failed to disclose sources of income in excess of $1,300 on Statements of Financial Interests filed for the 1997, 1998 and 1999 calendar years. In considering the first allegation involving conflict of interest, we initially observe that under the clear terms of Section 10 -1007 of the Public School Code, the compensation that O'Connor 02- 001 -C2 Page 26 O'Connor received for teaching courses at Temple and Wilkes University was not authorized by law. 24 P.S. § 10 -1007. Although this Commission does not have the statutory jurisdiction to interpret laws other than the Ethics Act, such other laws do become relevant in determining whether a particular pecuniary benefit is authorized in law and therefore permitted under the Ethics Act, or is not authorized in law and therefore considered a private pecuniary benefit which may form the basis for a violation of Section 3(a)/1103(a) of the Ethics Act. See, Thompson, Opinion 99 -005, at 3 -4. The compensation that O'Connor received for teaching graduate courses at Temple and Wilkes University without the authorization of the LIU Board was compensation that was not authorized by law and was therefore a private pecuniary benefit. However, in order for a violation of Section 3(a)/1103(a) of the Ethics Act to be established as to the teaching itself, there must have been a use of the authority of the public position to secure the prohibited private pecuniary benefit. Based upon the facts before us, O'Connor did not use the authority of his public position to secure the teaching work that he did for Temple. Rather, it appears that O'Connor was recruited by Powell, the program coordinator for Temple's Master of Education and Doctor of Education programs, to teach the Temple courses. However, O'Connor did use the authority of his public position as LIU Executive Director to secure the teaching work with Wilkes University. O'Connor, in his capacity as LIU Executive Director, initiated and authorized the arrangement between the LIU and Wilkes University. O'Connor contacted Bellucci, Director of Graduate Teacher Education at Wilkes University, and informed Bellucci that the LIU was interested in working with Wilkes University to offer graduate courses at the LIU. O'Connor set up the meeting with Bellucci. O'Connor directed his subordinates, Makar and Law, to attend the meeting. O'Connor informed Bellucci that he was interested in teaching a course in school law and that he wanted the classes to be held at the LIU facilities. O'Connor informed Bellucci that the LIU was upgrading its computer room, and that the new facility would meet the requirements of Wilkes University. O'Connor further informed Bellucci that Law and Makar were willing and able to teach graduate school courses for Wilkes University at the LIU. The above uses of the authority of O'Connor's public position as LIU Executive Director resulted in a private pecuniary benefit to O'Connor consisting of the very compensation he received for teaching the Wilkes University courses. But for being the LIU Executive Director, Respondent would not have been able to negotiate an agreement with Bellucci to offer graduate courses at the LIU through Wilkes University, nor would he have been able to arrange for other LIU employees to teach technology courses so as to satisfy the requirements of Wilkes University. The teaching compensation that O'Connor received as the direct result of these actions was a private pecuniary benefit because he was never given the statutorily required approval of the LIU Board to teach these courses. Additionally, for both the Temple and Wilkes University courses, the facts as deemed admitted by Respondent establish that Respondent used the LIU facilities for the courses he taught. With regard to the Temple courses, the facts as deemed admitted by Respondent establish that Respondent also used LIU employees, supplies and equipment in support of his teaching. These actions by Respondent constituted uses of the authority of his public position. But for being the LIU Executive Director, Respondent would not have been able to: (1) circumvent the LIU requirements for obtaining approval to use LIU facilities; (2) direct the use of subordinate LIU personnel and the use of LIU equipment and supplies in support of his teaching position; or 3) use office space at the LIU for storage related to his teaching Respondent never sought, nor was he given, approval by the LIU Board to use the LIU facilities or staff in support of his teaching for Temple or Wilkes University. The private pecuniary benefits that Respondent received as the result of the above actions in his public capacity have been quantified as follows. O'Connor 02- 001 -C2 Page 27 First, the private pecuniary benefit that Respondent received as to the Temple courses totaled $7,113.88 (Findings 32 -35, 37). We note that Respondent has asserted that there are no credible facts of record establishing the value of Respondent's use of LIU facilities and that the value of his use of staff was de minimis (see, Closing Statement for Respondent at 10). We have already rejected Respondent's factual arguments regarding the valuation of Respondent's use of facilities and staff support based upon the admitted Findings, and so too we reject Respondent's related legal arguments. There are credible facts of record — specifically, the Findings of the Investigative Complaint which Respondent is deemed to have admitted — establishing the values of both Respondent's use of LIU facilities and staff, and such values are not de minimis. Additionally, Respondent received a private pecuniary benefit of $21,600 as a result of the use of his public position to obtain contracts with Wilkes University to teach courses using LIU facilities for class space (Finding 59). This pecuniary benefit consisted of the compensation Respondent received for teaching these courses at the LIU without the statutorily required 'release" of the LIU Board. Respondent has argued that there is no "linkage" between the upgrade of the LIU computer facilities and the use of that upgrade and his public employment to obtain the teaching position with Wilkes University (Closing Statement for Respondent at 10 -11). As noted above, Respondent repeatedly used the authority of his public position as Executive Director of the LIU to secure the arrangement with Wilkes University which included his teaching courses for compensation. The fact that the computer upgrades were initiated prior to Respondent's contact with Belluci is irrelevant given that Respondent proffered the LIU facilities and equipment as upgraded to secure the arrangement with Wilkes University and teaching contracts for himself. With regard to Respondent's misuse of both LIU classroom space and the LIU computer facilities, Respondent has asserted that the "class /subclass" exclusion in the definition of "conflict" or "conflict of interest" is applicable such that no conflict of interest existed (Closing Statement for the Respondent at 6, 10). We reject the argument. In order for the class /subclass exclusion in the Ethics Act's definition of "conflict" or "conflict of interest" to apply, two criteria must be met: (1) the affected public official /public employee, immediate family member, or business with which the public official /public employee or immediate family member is associated must be a member of a class consisting of the general public or a true subclass consisting of more than one member; and (2) the public official /public employee, immediate family member, or business with which the public official /public employee or immediate family member is associated must be affected "to the same degree" as the other members of the class /subclass. 65 Pa.C.S. § 1102. The first criterion of the exclusion is satisfied where the members of the proposed subclass are similarly situated as the result of relevant shared characteristics. The second criterion of the exclusion is satisfied where the individual /business in question and the other members of the class /subclass are reasonably affected to the same degree by the proposed action. Kablack, Opinion 02 -003. In this case, the class /subclass exclusion would not be applicable because the first criterion would not be met. Respondent, as Executive Director of the LIU, would not be "similarly situated" to the other staff at the LIU or to any other instructors at the LIU using LIU classroom space or computer facilities. Thus, there would not be a true subclass consisting of more than one member. Given that the first criterion would not be met, the second criterion need not be addressed. Based upon the above, we find that the Investigative Division has met its burden of proof as to the first allegation. We hold that Respondent O'Connor, as Executive Director of the LIU, violated Section 3(a)/1103(a) of the Ethics Act when he used the authority of his said O'Connor 02- 001 -C2 Page 28 public position for the private pecuniary benefit of himself by using LIU facilities, including but not limited to a computer lab and related equipment, supplies and personnel to assist his teaching courses and receipt of compensation from Wilkes University and Temple. See, Sullivan, Order 1245; Aker, Order 1227; Cagno, Order 1204; Rakowsky, Order943. The total private pecuniary benefit received by Respondent O'Connor in violation of Section 3(a)/1103(a) of the Ethics Act was $28,713.88 ($7,113.88 + $21,600). We now turn to the second and fourth allegations involving failure to timely file Statements of Financial Interests. The facts as deemed admitted by Respondent clearly establish that Respondent failed to timely file Statements of Financial Interests for the 1997, 1998, 1999 and 2000 calendar years. We hold that Respondent O'Connor violated Section 4(a)/1104(a) of the Ethics Act when he failed to file Statements of Financial Interests as to his position as LIU Executive Director for the 1997, 1998, 1999 and 2000 calendar years by May 1st of 1998, 1999, 2000 and 2001 respectively. Respondent's delinquent Statements of Financial Interests for calendar years 1997- 1999 were admittedly backdated, while the form for calendar year 2000 was not dated at all. In considering the third allegation involving the filing of backdated Statements of Financial Interests, we hold that Respondent O'Connor violated Section 4(a)/1104(a) of the Ethics Act when he submitted backdated Statement of Financial Interests forms as to his position as LIU Executive Director for calendar years 1997, 1998 and 1999. See, e.q., Forrest, Order 1230; Draper, Order 1229. In considering the fifth and final allegation involving the filing of deficient Statements of Financial Interests, the facts as deemed admitted by Respondent establish that Respondent failed to report Temple as a source of income for calendar years 1997 -1999 and Wilkes University as a source of income for calendar year 1999. Respondent intentionally omitted Temple and Wilkes University as sources of income on the aforesaid Statement of Financial Interests forms in order to avoid disclosure of his receipt of income from these entities (Finding 81). We hold that Respondent O'Connor violated Section 5(b)(5)/1105(b)(5) of the Ethics Act when he failed to disclose sources of income in excess of $1,300 on Statements of Financial Interests filed as to his position as LIU Executive Director for the 1997, 1998 and 1999 calendar years. In its Closing Statement, the Investigative Division has requested that we: (1) order Respondent to pay restitution; (2) refer this matter to an appropriate law enforcement authority with a recommendation for review as to criminal prosecution; and (3) consider imposing an additional penalty pursuant to Section 1104(d) of the Ethics Act equaling the amount of compensation Respondent received as Executive Director of the LIU during periods of non- compliance as to the filing requirements for Statements of Financial Interests. (Section 1104(d) of the Ethics Act, which is not referenced in the Allegations of the Investigative Complaint, prohibits a public official from taking the oath of office, entering or continuing the duties of his ublic office, or receiving compensation from public funds unless he has filed a Statement of Financial Interests as required by the Ethics Act.) In his Closing Statement, Respondent urges that we: (1) assess minor or no financial penalties; (2) decline to refer this matter for review by law enforcement officials; and (3) decline to order a penalty under Section 1104(d) based upon the contention that such a penalty would be disproportionately severe as to Respondent's admitted failures to file Statements of Financial Interests, as well as his asserted status as a public employee rather than a public official. See, Heck, Order 1251. In considering restitution, we note that Section 407(13)/1107(13) of the Ethics Act empowers this Commission to impose restitution in instances where a public official /public employee has obtained a financial gain in violation of the Ethics Act. We determine that restitution is warranted in this case, not only as to the $7,113.88 attributable to the use of LIU O'Connor 02- 001 -C2 Page 29 facilities, employees, supplies and equipment for O'Connor's courses through Temple but also as to the full $21,600 of compensation O'Connor received from Wilkes University for teaching courses without any release from the LIU Board while using LIU facilities for class space. Respondent, who taught School Law at the graduate level, blatantly disregarded the requirements of the Public School Code as they pertained to obtaining a release from the LIU Board as to his own teaching. O'Connor never obtained the approval of the LIU Board to teach graduate courses for either Temple or Wilkes University, and therefore the full amount of compensation that he received for teaching these courses was not authorized in law. Respondent used the authority of his public position at the LIU to secure for himself the teaching work through Wilkes University. As to both the Temple and Wilkes University teaching work, Respondent repeatedly used the LIU facilities without any authorization from the LIU Board. Finally, Respondent intentionally failed to file Statements of Financial Interests as required by the Ethics Act and ultimately filed backdated forms for calendar years 1997- 1999, intentionally omitting Temple and Wilkes University as sources of income in order to avoid disclosing the fact that he had received income from these entities. Based upon the above, full restitution to the LIU is appropriate. Accordingly, O'Connor is directed to make payment of restitution to the LIU through this Commission in the amount of $28,713.88 within 30 days of the date of mailing of this Order. Additionally, if O'Connor has not already done so, he is directed to file, within 30 days of the date of mailing of this Order, amended Statements of Financial Interests for calendar years 1997, 1998, 1999 and 2000 to reflect the actual date of filing and all reportable sources of income. The original of each such amended form is to be filed with the LIU, with one copy sent to the Administrative Division of this Commission for compliance verification purposes. Based upon our review as reflected in the above analysis and the totality of the relevant facts and circumstances, we determine that directing Respondent to: (1) pay full restitution to the LIU in the amount of $28,713.88; and (2) file amended Statements of Financial Interests for calendar years 1997 -2000 as set forth above, is the appropriate disposition of this case. 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. Respondent Kevin O'Connor ( "O'Connor "), in his former capacity as Executive Director of the Luzerne Intermediate Unit ( "LIU "), was a public official /public employee 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." 2. O'Connor, as Executive Director of the LIU, violated Section 3(a)/1103(a) of the Ethics Act when he used the authority of his said public position for the private pecuniary benefit of himself by using LIU facilities, including but not limited to a computer lab and related equipment, supplies and personnel to assist his teaching courses and receipt of compensation from Wilkes University and Temple University. 3. O'Connor violated Section 4(a)/1104(a) of the Ethics Act when he failed to file Statements of Financial Interests as to his position as LIU Executive Director for the 1997, 1998, 1999 and 2000 calendar years by May 1 of 1998, 1999, 2000 and 2001 respectively. O'Connor 02- 001 -C2 Page 30 4. O'Connor violated Section 4(a)/1104(a) of the Ethics Act when he submitted backdated Statement of Financial Interests forms as to his position as LIU Executive Director for calendar years 1997, 1998 and 1999. 5. O'Connor violated Section 5(b)(5)/1105(b) 5 of the Ethics Act when he failed to disclose sources of income in excess of $1,300 on Statements of Financial Interests filed as to his position as LIU Executive Director for the 1997, 1998 and 1999 calendar years. 6. Restitution is warranted in this case. In Re: Kevin O'Connor ORDER NO. 1269 File Docket: 02- 001 -C2 Date Decided: 2/27/03 Date Mailed: 3/5/03 1. Respondent Kevin O'Connor ( "O'Connor "), a public official /public employee in his former capacity as Executive Director of the Luzerne Intermediate Unit ('LIU "), violated Section 3(a)/1103(a) of the Ethics Act when he used the authority of his said public position for the private pecuniary benefit of himself by using LIU facilities, including but not limited to a computer lab and related equipment, supplies and personnel to assist his teaching courses and receipt of compensation from Wilkes University and Temple University. 2. O'Connor violated Section 4(a)/1104(a) of the Ethics Act when he failed to file Statements of Financial Interests as to his position as LIU Executive Director for the 1997, 1998, 1999 and 2000 calendar years by May 1 of 1998, 1999, 2000 and 2001 respectively. 3. O'Connor violated Section 4(a)/1104(a) of the Ethics Act when he submitted backdated Statement of Financial Interests forms as to his position as LIU Executive Director for calendar years 1997, 1998 and 1999. 4. O'Connor violated 5(b)(5)/1105 (b)(5) of the Ethics Act when he failed to disclose sources of income in excess of $1,300 on Statements of Financial Interests filed as to his position as LIU Executive Director for the 1997, 1998 and 1999 calendar years. 5. O'Connor is directed to make payment of restitution to the LIU through this Commission in the amount of $28,713.88 within 30 days of the date of mailing of this Order. 6. If O'Connor has not already done so, he is directed to file, within 30 days of the date of mailing of this Order, amended Statements of Financial Interests for calendar years 1997, 1998, 1999 and 2000 to reflect the actual date of filing and all reportable sources of income. The original of each such amended form is to be filed with the LIU, with one copy sent to the Administrative Division of this Commission for compliance verification purposes. 7. Compliance with paragraphs 5 and 6 of this Order 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. BY THE COMMISSION, Louis W. Fryman, Chair