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HomeMy WebLinkAbout1284 SnyderIn Re: Michael Snyder 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 02- 025 -C2 Order No. 1284 6/23/03 7/8/03 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 investigation, the Investigative Division served upon Respondent written notice of the specific allegation(s). Upon completion of its investigation the Investigative Division issued and served upon Respondent a Findings Report identified as an "Investigative Complaint." An Answer was not filed and a hearing was deemed waived. The record is complete. A Consent Agreement and Stipulation of Findings were submitted by the parties to the Commission for consideration. The 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 Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter 11 of Act 93 of 1998, 65 Pa.C.S. § 1101 et seq., which essentially repeats Act 9 of 1989 and provides for the completion of pending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. Snyder 02- 025 -C2 Page 2 I. ALLEGATION: That Michael Snyder, a public official /public employee, in his capacity as Director of the Pennsylvania Department of Education's School to Work program violated Sections 1103(a); 1105(a); 1105(b)(5); 1105(b)(8); and 1105(b)(9) of the Public Official and Employee Ethics Law 65 Pa.C.S. § §1103(a); 1105(a); 1105(b)(5); 1105(b)(8); 1105(b)(9) when he used the authority of his position for a private pecuniary gain of himself and /or a business with which he is associated by using, including but not limited to, information obtained from his public position to obtain a contract to provide educational consulting services to the State of Delaware, Department of Education, when he utilized Commonwealth facilities, equipment and time in conjunction with the contract; when he failed to disclose on Statements of Financial Interests for the 1999 calendar years his interest in EDSPIE and income received from EDSPIE; when he participated in actions of the Department of Education, including but not limited to, awarding grant funds to his partners in EDSPIE and professors who served on an advisory panel while Snyder was enrolled in a doctoral program. II. FINDINGS: 1. Michael P. Snyder has been employed by the Commonwealth of Pennsylvania since June 13, 1988, with the following agencies. a. Education: 06/13/88 to 03/11/00 Vocational Education Transportation: 03/11/00 to 04/14/01 Administrative Officer V Executive Offices: 04/14/01 to present Imagine PA project 2. At all times relevant to the investigation, Snyder was employed by the Pennsylvania Department of Education as the Coordinator of the Commonwealth's School -to -Work (STW) program. a. The school -to -work coordinator reported directly to Thomas Carey, the Deputy Secretary of the Department's Office of Elementary and Secondary Education. 3. The School -to -Work program was created by the School -to -Work Opportunity Act. The purpose of which was to establish a national framework with which all states can create statewide School -to -Work Opportunities Systems as part of comprehensive education reform and offer opportunities for all students to participate in a performance based education and training program. a. The central theme of the Act is the importance of work -based community learning during high school years to promote career awareness, teach occupational skills and facilitate the transition from high school to full -time employment. b. The Act authorized funding for states over a five year period. 4. Snyder's duties and responsibilities while serving as the School -to -Work liaison for the Department of Education included the following: a. Prepare and submit grant applications to the U.S. Department of Education to ensure continuation of STW grant funds. b. Serve as the Department of Education representative to the interagency team. 1. Snyder was the lead member of the interagency team because PDE was the lead agency and the fiscal agent of the federal STW grant. 2. Snyder was involved with developing the request for proposal guidelines and proposal scoring guidelines for the local partnership grants. Snyder 02- 025 -C2 Page 3 3. Snyder participated in the decisions on which partnerships were funded and the amount of funding provided to each partnership. 4. Snyder reviewed and monitored STW activities and reported to PDE administration. c. Serve as the contact person for the partnership coordinators. 1. Snyder monitored the partnerships to ensure that they continued to meet the federal guidelines fiscally and programmatically. 2. Snyder was responsible for approving budgets and any budget changes. 3. Snyder scheduled and participated in partnership site visits. 4. Snyder scheduled, organized, and headed quarterly partnership coordinator meetings. d. Serve as the liaison between the state and national STW offices. 1. Snyder completed and submitted continuation grant proposals to the national STW office. 2. Snyder completed and submitted STW progress reports to the national STW office. 3. Snyder was the Pennsylvania delegate to national STW conference and meetings. e. Provide oversight of the STW resource center grant and activities. 5. The Commonwealth's School -to -Work program was federally funded through the U.S. Department of Education and U.S. Department of Labor. a. The Commonwealth received a five (5) year grant in the amount of $27,996,640 to implement a statewide school -to -work program. b. The School -to -Work five year grant period commenced on September 1, 1995, and ran through August 31, 2000. 6. The federal grant was utilized to fund the Commonwealth's School -to -Work office and provide subgrants to local partnerships. a. The Commonwealth's School -to -Work office consisted of Snyder, an administrative assistant and a clerk typist. b. The STW office would disburse grants to local partnerships a /k/a Local Education Associations comprised of local industry, employee representatives, vo -tech schools, intermediate units, junior /community colleges, state and /or private colleges and universities. 1. There were 57 such local partnerships applying for STW funding. 7. Partnerships seeking STW grants were required to submit applications to an inter- agency team which reviewed and rated applications and then awarded grant funds. Snyder 02- 025 -C2 Page 4 8. The inter - agency team's primary responsibility was to review and evaluate grant proposals submitted by local partnerships and to award funding. a. The interagency team typically held one meeting per month. b. Grant applications would be reviewed and graded. c. The final decision on which partnerships were to be funded rested solely on the numerical scores assigned to the applications through the review process and required the approval of all three secretaries of the Departments of Education, Labor and Industry and Commerce. d. The inter - agency team reviewed and approved fifty -seven (57) partnership and ten (10) challenge grants. e. The Commonwealth was divided into ten (10) regions for challenge grants. 1. A challenge grant was awarded for each region. 2. The challenge grants were to promote regional unity regarding school -to- work initiatives. 9. The inter - agency team was comprised of a representative from the Department of Education, Department of Commerce, Department of Labor & Industry, and the Governor's Policy Office. a. Members of the inter - agency team were: Department of Education: Department of Commerce: Department of Labor & Industry: Governor's Policy Office: Michael Snyder Terri Kaufmann Michael Bakaysa Peter Tartline 10. Michael Snyder served as the leader of the inter - agency team since the Department of Education was the department funding the school -to -work program. a. Other members of the team have asserted that they deferred to Snyder when making decisions. 11. The inter - agency team developed requests for proposals (RFPs) which were advertised statewide. a. Snyder developed the RFPs which were open to comment from, modified and agreed to by other team members. b. The RFP guidelines established the composition of local partnerships and how grant funding could be spent. c. The RFP guidelines provided that the proposals would be competitively bid. 1. All partnerships submitting proposals received funding, although the amounts varied. 12. Following the receipt of proposals, the inter - agency team independently reviewed and evaluated each proposal. a. A template was developed based on the guidelines to use to score the Snyder 02- 025 -C2 Page 5 proposals. b. Inter - agency peer review teams reviewed and graded proposals. 1. Ratings from these peer review teams were sent to Snyder at the PDE. c. The inter - agency team would then meet and discuss the proposals. 1. Proposals had already been ranked by the scores from the peer review teams, and the amount of funding each would receive had been determined in accordance with the funding guidelines. 2. Snyder tallied the scores from the peer review teams and applied the funding guidelines to the scored applications. 13. During the subsequent years of the program, partnership proposals were reviewed from a sustainability perspective. a. Partnerships would submit revised proposals reflecting progress in projects and requests for continued funding. b. Snyder would receive and review these proposals, and present them to the inter - agency team, which made determinations regarding continued funding. 14. The final decision to award funding for any grant proposal was vested with the secretaries for PDE, the Department of Commerce and the Department of Labor and Industry. The approval from each secretary was a prerequisite for any funding award. a. The inter - agency team, which included Snyder, determined which projects to submit to the secretaries based on the projects' numerical scoring and the funding guidelines. b. Snyder, as the STW coordinator, submitted the inter - agency team's recommendations to Peter Tartline of the Governor's Policy Office and Thomas Carey, Deputy Secretary of the Department of Education in order to obtain authorization to submit the recommendations to the secretaries for approval. 15. Snyder also was responsible for organizing and participating in inter - agency quarterly coordinator meetings held at the Pennsylvania State University main campus. a. Partnerships receiving grants would attend these meetings. b. The inter - agency team also conducted some partnership site visits. c. Partnership visits typically occurred only if there was a problem. d. The majority of site visits were done by Snyder. 16. In addition to providing funding to partnerships, STW grants were made available in the form of research grants, as well as funding a resource center. a. Research grants were awarded to professors at Penn State who were specializing in workforce development. b. STW funding was used to create a STW resource center which was also located at PSU's main campus. Snyder 02- 025 -C2 Page 6 c. The STW resource center concept came from the Tech Prep clearinghouse at Penn State University's McKeesport branch campus. The following findings relate to the allegation that Michael Snyder approved grants to PSU professors who served on his doctoral committee. 17. Snyder participated in the review and approval of STW grants to PSU in his official capacity as the coordinator of the Commonwealth STW office while simultaneously being enrolled at PSU as a doctoral candidate. a. Snyder recommended approval and participated in approving grants to PSU professors who served on his doctoral committee and /or served as instructors in classes in which Snyder was enrolled. 1. Snyder, as STW coordinator, had oversight responsibilities for expenditures related to these grants. 18. Snyder was officially enrolled in the Workforce Education doctoral degree program at o PSU's main campus from fall semester 1996 until his graduation in May 2001. a. Snyder had a five (5) member doctoral committee at PSU consisting of professors Ken Gray, Richard Walter, David Passmore, Edgar Yoder and Mary Kisner. 19. PSU does not have any official guidelines for instructors who receive grant funding from their students or businesses with which a student may be an officer, director, owner or employee. 20. PSU submits grant applications to the Pennsylvania Department of Education utilizing the following procedures: a. The grants project director, locates and identifies potential funding sources. b. The project director prepares a grant application /proposal includes the nature and scope of the project, known staff and researchers involved and budget projections. 1. The application /proposal includes the nature and scope of the project, known staff and researchers involved and budget projections. c. For grants originating from PSU's College of Education, the application is reviewed by the College's contract proposal specialist prior to being forwarded to the university's Office of Sponsored Programs. d. For grants originating from PSU branch campuses, university outreach programs and any other university department that does not have their own grant writer, the application goes directly to PSU's Office of Sponsored Programs. e. The Office of Sponsored Programs reviews grant applications prior to their submission to the Department of Education. 21. Grant funding received by Penn State is handled by PSU's Office of Research Accounting. a. The Office of Research Accounting serves as the grant fiscal administrator at the university level. Snyder 02- 025 -C2 Page 7 b. The Office of Research Accounting processes all invoices and expenditures from research grants. c. Payments for professors salaries are processed internally within their respective departments. 22. Professors within PSU Workforce Education Department do not have minimum requirements with respect to the amount of research grants they need to secure for the university. 23. Snyder did not disclose to anyone at the Department of Education that he was participating as a member of the inter - agency team in regard to grant funding to professors and members of his doctoral committee at PSU while simultaneously taking classes from those individuals. a. Members of the inter - agency team were aware that Snyder reviewed PSU grant proposals, but were not aware that the applicants included professors who served on Snyder's doctoral committee. b. The inter - agency team members agreed that a quality review and control process had been established and implemented for awarding STW funds to applicants and local partnerships. Accordingly, members did not recuse themselves despite relationships with applicants or local partnerships. c. All STW grants awarded to PSU professors were considered in accordance with the same inter - agency review process used to evaluate all other applications. In all instances, STW grants were awarded based on the numerical score received by the PSU application as a result of the inter - agency review process. 24. During PSU's fall semester of 1996 Snyder was enrolled in Workforce Education 596, individual studies with Ken Gray as his instructor. 25. In or about August 1996, Ken Gray submitted an application to PDE's Bureau of Vocational and Technical Education ( "BVTE ") for a research grant from Tech Prep grant funds administered by BVTE. a. b. c. d. e. Gray sought funding to conduct a study regarding tech -prep outcomes. Dr. Thomas Winters, the division chief for BVTE, asked Snyder to review the application after Dr. Lee Burkett, the Tech Prep coordinator, left her position with PDE. Snyder's position as STW coordinator did not entail work for BVTE or reviewing Tech Prep grant applications. Snyder reviewed the application and recommended approval. Bidding requirements for the application were waived. Snyder did not advise Winters that Gray was on his Doctoral Committee. 26. Gray was awarded grant funds in the amount of $60,000 under project number 386- 7024 to conduct a pilot study titled, "An Assessment of Tech Prep Outcomes in Pennsylvania" effective September 1, 1996, through June 30, 1997. a. Thirteen thousand five hundred seventeen dollars ($13,517) was specifically budgeted under salaries for Ken Gray as Project Administrator. Snyder 02- 025 -C2 Page 8 b. A sum of $15,450 was budgeted for un -named research assistants. 1. Snyder did not serve as a research assistant at PSU. c. Snyder admitted during a statement provided to State Ethics Commission investigators that he approved and signed off on this grant. 1. Snyder confirmed that bidding requirements were waived. 27. The summary of final expenses for grant 386 -7024 was reviewed and approved by PDE Vocational Education Fiscal Administration Unit on September 16, 1997. a. At the request of Winters and due to the absence of Burkett, Snyder was responsible for all oversight of expenditures submitted by Gray in relation to this grant. b. Snyder approved all of the expenditures prior to the fiscal administration review. 28. During the period from September 1996 through June 1997 Snyder had oversight responsibility for Grant 386 -7024. a. This included granting a waiver of the bidding requirements for the grant and approving all expenditures. b. During this same time period Snyder was enrolled in WFE596, a course taught by Ken Gray. 29. During the fall semester of 1997 Snyder was enrolled in Workforce Education 540, Work Ed data and Workforce Education 597A, Policy Analysis, with David Passmore PhD as his instructor. 30. Richard Walters submitted a grant application to Snyder on or about May 1, 1997, seeking funding to conduct a study regarding national skills standards for manufacturing. a. Walters included wages for David Passmore in this grant application. b. Passmore was on Snyder's doctoral committee at the time. Walters was not on Snyder's doctoral committee at the time. 31. Two months prior to Snyder attending the class taught by Passmore, grant number 56- 7008 in the amount of $228,000 to PSU for the national skills standards for manufacturing implementation project was approved. a. Professors Richard Walters and David Passmore are identified as being involved with this grant award. PSU submitted the grant at the direction of Dr. Martha Harris, then CEO of the Pennsylvania Human Resources Investment Council. b. The stated grant period was May 1, 1997, through September 30, 1997, encompassing both summer semester and part of fall semester 1997. c. Two thousand seven hundred twenty -five dollars ($2,735.00) was specifically budgeted under salaries for Richard Walter as project director. 1. Richard Walter became a member of Snyder's doctoral committee some Snyder 02- 025 -C2 Page 9 two years later, on November 3, 1999, due to Ken Gray taking a sabbatical. d. Seven thousand two hundred fifty dollars ($7,250.00) was specifically budgeted under salaries for David Passmore. 32. The inter - agency team, including Snyder, reviewed the grant application and recommended approval of an award in the amount of $228,000. 33. Walters submitted an additional grant application to Snyder for funding for additional research regarding national skills standards for manufacturing. a. The application was submitted on or about December 1997, nearly two years prior to Walters becoming a member of Snyder's doctoral committee. 34. The inter - agency team, including Snyder, approved grant award 56 -8004 in the amount of $68,700.00 on December 15, 1997, for National Skills Standards for manufacturing implementation project. a. Snyder signed as authorized reviewer for the PDE. b. Four thousand three hundred thirty -nine dollars ($4,339.00) was budgeted under salaries for Richard Walter as project director. c. This grant award had a stated contract period of January 1, 1998, through September 30, 1998. 35. On December 16, 1997, Snyder presented to the inter - agency team a request for a waiver of expenses for the Walters grant 56 -8004. a. The inter - agency team, including Snyder, approved a waiver of 50% of the personnel cost limit and a waiver of the 5% administrative cost limit. 36. At the time Snyder participated in the approval of grant award 56 -8004 and the subsequent waiver, he was completing Workforce Education 540 and WFED597A taught by Passmore. 37. In or about May 1997, funding was sought by PSU to locate a technical resource center for the STW program at Penn State Main Campus. a. The application was submitted to Snyder by Roy McCullagh. 38. The inter - agency team, including Snyder, recommended approval of grant award contract no. 003 -8001, in the amount of $197,438 in May 1997. a. This contract was titled Pennsylvania School -to -work Technical Assistance and Resource Center. b. Roy McCullagh is identified as the project director with a budgeted salary of $37,408. 1. Roy McCullagh later became involved in a private business venture with Snyder. No such business venture existed at the time of the grant funding. 39. On October 23, 1997, Snyder presented a waiver request to the inter - agency team for grant no. 003 -8001. Snyder 02- 025 -C2 Page 10 a. The waiver recommended by Snyder authorized a $3,000 increase in the amount for expenses for Object 400, purchase property services and a waiver of the 25% local match requirement and 50% personnel cost limit. 40. After inter - agency team approval, Snyder signed an authorization for Rider A for 003- 8001 which increased funding for that grant from $197,438 to $341,412. a. The grant period was extended to cover the period from May 4, 1998, to September 30, 1998. b. The grant included a salary of $37,408 for Roy McCullagh for 1998. 41. Grant 003 -8001A also included provisions to hire a consultant for a Power Source software contract. 42. Mary Kisner is identified as the Power Source technical assistant with a budgeted salary of $6,540. a. Mary Kisner is a part -time professor at PSU in the workforce development curriculum. 43. Kisner was selected to assist with the development of Power Source software which was to be used statewide as part of the STW program. a. The company initially selected by Snyder's predecessor was unable to develop the software. b. Snyder made the recommendation to utilize Kisner because of her familiarity with the software, and she served on his doctoral committee. 44. Mary Kisner was serving on Snyder's doctoral committee at the time the inter - agency team recommended approval of this grant and at the time it was awarded by the Department secretaries. 45. Kisner was included as part of this grant as a result of direction provided by Snyder to Roy McCullagh. a. On April 6, 1998, Snyder authored a letter to McCullagh to negotiate the services of Mary Kisner to assist with the PA Power Source advisory committee. b. Snyder's letter noted that he discussed this with Rich Walters. c. Snyder also noted that he and Kisner had agreed upon her availability. 46. Snyder, in his official capacity as the State's school -to -work director participated in the approval process of or had supervisory responsibility over four (4) grant contract awards /contract award amendments which provided funding for salaries paid to six of seven members of his doctoral committee totaling at least $34,381. However, Richard Walter was not a member of Snyder's doctoral committee at the time the relevant grants were awarded via the inter - agency team process. The per grant award is as follows: a. Contract No. Committee Member Budgeted Amount 386 -7024 Ken Gray $ 13,517.00 56 -7008 Richard Walter* $ 2,735.00 Contract # Effective Dates Contract Amounts Budgeted Salary 386 -7002 07/01/96- 09/30/98 $173,837 $33,400 056 -7007 05/01/97- 09/30/97 $95,000 $9,255 003 -8001 05/01/97- 09/30/97 $197,438 $37,408 003-8001(A) () 09/30/98- 09/30/98 $341,412 $37,408 Snyder 02- 025 -C2 Page 11 David Passmore $ 7,250.00 56 -8004 Richard Walter* $ 4,339.00 003- 8001(a) Mary Kisner $ 6 540.00 Total $ 34,381.00 b. Snyder oversaw STW grant funding provided to each member of his doctoral committee with the exceptions of Ken Gray and Edgar Yoder. 1. Edgar Yoder was not a professor in the workforce education department. 2. Dr. Tom Winters oversaw BVTE Tech Prep grant funding to Ken Gray, and, at Winters' request, Snyder reviewed that grant application in an effort to assist the BVTE which had just lost its Tech Prep coordinator. 47. In addition to the grants Snyder was involved with which were awarded to professors and members of his doctoral committee while at PSU, Snyder also participated in awarding grant funding to Roy McCullagh. a. McCullagh later became affiliated with Snyder in Snyder's private company, EDSPIE. 48. Snyder reviewed and the inter - agency team recommended approval of grant awards to the southwestern rural Tech Prep Consortium and School to Nork Resource Center which funds were used in part to cover portions of McCullagh's salary. a. Grant awards reflect McCullagh received compensation from the following grant awards: 49. Only the contract 003 -8001 amendment came during the same time period (05/98 to 09/30/98) when Snyder and McCullagh were attempting to develop a contract on behalf of EDSPIE. The following findings relate to the allegations that Michael Snyder used the authority of his public position for the benefit of EDSPIE, a business with which he is associated. 50. Sometime prior to August 21, 1998, Snyder approached Roy McCullagh regarding a joint business venture concerning consulting for a vocational technical program. a. Snyder was hopeful of obtaining a consulting contract with the State of Delaware's technical prep program. 1. Snyder became aware of the potential contract after being contacted in his public position by officials from the State of Delaware. Snyder 02- 025 -C2 Page 12 b. Snyder recruited McCullagh and Jane Schimpf to assist him. 1. Both McCullagh and Schimpf had considerable experience with tech - prep programs. 51. On August 21, 1998, Snyder and Roy McCullagh met with representatives of Tech Prep Delaware at Rehoboth Beach Delaware to discuss the possibility of conducting a survey of Delaware's Tech Prep program. a. Representatives of Delaware's Tech Prep program who attended the meeting included James Campbell, Executive Director; Jeffrey Adams, Board Member; and George Frunzi, Board Member. b. The business name utilized by Snyder in his dealings with Delaware officials was EDSPIE. c. Snyder and McCullagh were present on behalf of EDSPIE. 52. James Campbell, the Director of Tech Prep Delaware, was directed by the board of directors in late 1997 or early 1998 to do an evaluation of the Tech Prep program. a. Campbell made the decision to utilize an independent out -of -state contractor. b. Campbell was familiar with Michael Snyder from tech prep related conferences. c. Campbell contacted Snyder at the STW offices in early 1998 to discuss the planned evaluation of Delaware's Tech Prep program. 1. Campbell informed Snyder that he was looking for a company to do the evaluation. d. Snyder advised Campbell that he was associated with a company named EDSPIE that could do the evaluation. e. Campbell arranged to meet with Snyder and then entered into the contract. 53. Snyder filed a fictitious name application with the Pennsylvania Department of State on October 20, 1998, for EDSPIE. a. Michael P. Snyder is the only named individual on the fictitious name registry. b. EDSPIE is abbreviated for Education Strategic Planning Implementation and Evaluation. c. The nature of the business is stated as "consultant for developing and evaluating education systems." 54. Snyder created EDSPIE to have an official business name to deal with Delaware's Tech Prep Program. a. Snyder's fictitious name filing for EDSPIE occurred on the same day he faxed a contract from Department of Education offices to James Campbell, Delaware Tech Prep for approval. 55. On January 20, 1999, Snyder was issued business license number 1999202040 for unclassified personal and /or professional services under the business name EDSPIE, 205A Tenth Street, New Cumberland, PA 17070, by the Delaware Division of Snyder 02- 025 -C2 Page 13 Revenue. a. A business license was required for Snyder to have business dealings with the State of Delaware. 56. Employees of the Department of Education are required to get agency approval for any supplemental or outside employment contemplated regardless of the anticipated duration of the endeavor. a. Within the Department of Education the mechanism for supplemental employment approval is as follows: The requesting employee must complete a supplemental employment request which is submitted to the agency head, then to the secretary of administration for review and approval. 57. On December 15, 1998, Snyder submitted a request for the supplemental employment approval to the Department of Education. a. Snyder requested approval for supplemental employment for EDSPIE. b. Snyder described EDSPIE as being a consulting, strategic planning and evaluation business. c. Snyder identified himself as a principal of EDSPIE stating it was created October 22, 1998. d. Snyder states that he founded the organization to provide services in the area of strategic planning, implementation and evaluation. The specific area of service will revolve around workforce education and workforce development including research and the development of evaluation tools/ instruments. 58. On December 28, 1998, Snyder received notification from Suzanne K. Shatto, Coordinator, Supplementary Employment, that the Deputy Secretary for Administration had disapproved Snyder's supplemental employment request. a. Shatto's memo included correspondence dated December 23, 1998, from Ernest N. Helling, Office of Chief Counsel, recommending Snyder's request be denied. b. Helling's December 23, 1998, memo cited the following reason for the denial. "I recommend that we disapprove the above -noted request. This is because, on its face, the proposed supplementary employment appears to be based upon knowledge and information obtained by Mr. Snyder during the course of his employment by the Commonwealth. As such, it appears to conflict with section 7.154 of the Code of Conduct. That provision prohibits an employee, such as Mr. Snyder, from using for his own personal gain information obtained as a result of his Commonwealth employment and, which is not generally available. 4 Pa. Code §7.154. From the description given by Mr. Snyder, it is not at all clear that the conflict proscribed by this regulation will not occur. 59. Snyder's request for supplemental employment approval occurred six (6) weeks after he formally entered into a contract with the State of Delaware's Tech Prep program to provide consulting services under the business name EDSPIE. 60. Although the supplemental employment request was denied, Snyder continued to Snyder 02- 025 -C2 Page 14 engage in a private capacity as EDSPIE contracting with the State of Delaware. 61. After Snyder's request for supplemental employment was denied, he filed an appeal with the Office of Administration within ten days as required by Commonwealth policy. Mr. Snyder did not receive a response to his appeal for three months. 62. On January 14, 1999, Snyder forwarded a revised agreement to the State of Delaware, removing any compensation for his services but allowing for the reimbursement of expenses. 63. Snyder used Commonwealth equipment, materials, time and facilities to conduct EDSPIE business with the State of Delaware's Tech Prep Program. a. The Department of Education did not have a business relationships with Delaware's Tech Prep Program. b. Snyder did not receive approval to use Commonwealth equipment, materials, time or facilities to have EDSPIE's dealings with Delaware's Tech Prep Program. 64. Snyder utilized telephones /fax numbers of the Department of Education to conduct EDSPIE business on Commonwealth time with Delaware's Tech Prep Program. a. Snyder's normal working hours as the Director of the Commonwealth's School - to -Work Office was Monday through Friday, 7:30 a.m. until 4:00 p.m. b. (717) 772 -4178 was the designated fax number for the Commonwealth's School -to -Work office. c. (302) 739 -6171 was the designated fax number for James Campbell, Director of Delaware's Tech Prep Program. 65. Fax transmission logs for School -to -Work number (717) 772 -4178 detail the following series of incoming and outgoing faxes between (717) 772 -4178 (Office of School -to- Work) and (302) 739 -6171 (Tech Prep Delaware). a. Date Time Pages Sent /Received 02/10/97 9:33 a.m. 1 Received 01/12/98 3:48 p.m. 3 Received 07/14/98 2:52 p.m. 6 Sent 07/17/98 9:49 a.m. 6 Received 07/21/98 5:50 a.m. 1 Sent 08/03/98 9:36 a.m. 5 Received 10/13/98 10:23 a.m. 5 Received 10/20/98 11:29 a.m. 6 Sent 01/04/99 5:30 p.m. 1 Received (302) 577 -3303 b. None of these faxes related to Snyder's official duties as an employee of the Commonwealth. c. Seven (7) of the nine (9) faxes listed above were either sent or received during Snyder's normal work hours at the Department of Education. 66. On October 20, 1998, Snyder faxed a five page proposal to James Campbell Tech Prep Delaware, fax number (302) 739 -6171 from the Office of School to Work Opportunities (717) 772 -4178 at 11:23 a.m. Snyder 02- 025 -C2 Page 15 a. The fax coversheet requests comments and review from Campbell. Specifically written into the instruction portion is, "Jim — Proposed contract. I'll forward a hardcopy as soon as you approve them." with a signature Michael, presumed to be Snyder's. b. This contract did not relate to Snyder's duties as an employee of the Commonwealth. 67. Included with Snyder's fax is a contract detailing statements of work, work proposal and budget as follows: a. Survey nine secondary schools and four post secondary institution using an organizational readiness assessment instrument. b. Interview a select group at each education institution which will consist of an administrator, a counselor and three teachers. c. Provide a compilation of total surveys the end synopsis of the information therein. d. Provide a compilation of personal interviews and a synopsis of both total group and by title /position. e. Compare by secondary units and post secondary units. This synopsis will include individual breakdowns by both secondary and post secondary units. f. Provide a synopsis of comments made by the evaluation team. g. h. j. Provide a draft report for your consideration. Prepare final report for distribution to the Tech Prep Advisory Board. Present the results of the evaluation at the Tech Prep Advisory Boards Winter /Spring meeting. Under propriety of rights, parties agree that all reports, studies, plans, surveys and other materials prepared and submitted by Education Strategic Planning Implementation and Evaluation to Tech Prep Delaware are the property of ESPIE. Period of work is stated as August 15, 1998, through January 31, 1999. The agreement goes on to identify educational staff to be interviewed as well as survey dates. Survey dates are identified with the following schedule: Surveys distributed to all parties Schedule personal interview Surveys returned Personal interviews Personnel Project: Director at $550 per day Research instrument preparation Interviews Data analysis 10/12/98 10/12/98 10/13/98 10/13 -15/98 and 10/21 -22/98 k. The agreement further goes on to reflect that there will be three primary interviewers in addition to Snyder. Budget totaling $22,900 was submitted which would not include a Spring 1999 follow up survey. Specific budgeted items are as follows: 2 days 4 days 8 days Snyder 02- 025 -C2 Page 16 Spring advisory board meeting 1 day Total 15 days Project staff 4 days Interviews 9 days Data analysis 9 days Final report design /layout 2 days Spring advisory board meeting 3 days Total 23 days Travel: Project Director Project staff Lodging Communications: Postage Printing of surveys Printing of final report Miscellaneous Total Budget Total 2,000 miles .325 /miles 1,500 miles .325 /miles 8 nights @ $ 00 each Total a. EDSPIE was not associated with the Commonwealth. $ 8,250.00 @ $500 per day) 3 staff 3 days each 3 staff 3 days each 1 staff 2 days) 3 staff 1 day each) 11,500.00 $ 650.00 $ 488.00 $ 800.00 $ 1,938.00 $ 250.00 $ 500.00 20 copies @ $15 each $ 300.00 $ 162.00 $ 1,212.00 $ 22,900.00 This proposal is signed James R. Campbell, October 21, 1998, on behalf of Tech Prep Delaware. 68. The project director identified in the fax is Michael Snyder. 69. On November 7, 1998, another contract between Snyder d /b /a EDSPIE and Campbell representing Tech Prep Delaware was executed. a. The scope of work and budget remained the same as the October 20, 1998, contract as outlined in Snyder's fax of that date. b. Both Snyder and Campbell signed this agreement. 70. EDSPIE's services for Delaware's Tech Prep program did not in any way relate to Snyder's responsibilities as Director of the Commonwealth's School -to -Work program. 71. Snyder recruited Melissa Battaglini, Roy McCullagh and Jane Schimpf - Heipel to assist him with EDSPIE work for Tech Prep Delaware. a. Melissa Battaglini was the Tech Prep and School -to -Work coordinator for Fayette County, agencies that sought funding from PDE and /or STW. 72. Snyder used the mailing address of the Commonwealth's School -to -Work program to receive EDSPIE correspondence from Tech Prep Delaware. b. Snyder did not have permission from the Department of Education to use the School -to -Work offices as a contact point for personal business. 73. Snyder received correspondence from James Campbell/Tech Prep Delaware at School -to -Work offices on September 1, 1998, and October 19, 1998. Snyder 02- 025 -C2 Page 17 74. Business records of EDSPIE detail the following dates Snyder or his associates spent performing work related to the Tech Prep Delaware contract. 75. Snyder's leave records with the Commonwealth were compared with dates when Snyder reportedly performed services on behalf of EDSPIE's contract with the Delaware Tech Prep Program. a. Snyder did not have any recorded leave on November 12, 1998; December 10, 1998; or March 10, 1999, days when he reports working on EDSPIE business while also working for the Commonwealth. b. Snyder asserts that the EDSPIE work conducted on November 12 and December 10, 1998, occurred over dinner and well after his Commonwealth work hours had ended for the day. c. Snyder has no recollection of failing to submit a leave slip for March 10, 1999, and asserts that he never intentionally failed to submit a leave slip for his Commonwealth time. 76. Snyder's payroll history with the Commonwealth confirms Snyder's salary in November 1998 as range 9 step 19 and a biweekly salary of $2,440.50. a. Snyder received a step raise in January 1999 bringing his salary to $2,494.50 biweekly at pay range 9 step 20. 77. Snyder allegedly realized a private pecuniary gain of $737.55 as a result of being compensated by the Commonwealth while performing EDSPIE related business. a. Alleged financial gain based on the following calculations: November 12, 1998 December 10, 1998 March 10, 1999 7.5 hrs. 7.5 hrs. 7.5 hrs. 32.54 per hour 32.54 per hour 33.26 per hour $ 244.05 244.05 249.45 $ 737.55 b. Snyder vigorously disputes that he received any alleged financial gain, but particularly any associated with the November 12 and December 10, 1998, dates on which he met with the EDSPIE associates over dinner and later. DATE EDSPIE REPRESENTATIVE 07/11/98 Snyder 07/18/98 Snyder 08/21/98 McCullaqh 10/13/98 Snyder /Battaglini 10/14/98 Snyder /Battaglini 10/15/98 Snyder /Battaglini 10/21/98 McCullaqh /Schimpf 10/22/98 McCullaqh /Schimpf 10/23/98 Snyder /Schimpf /Battaglini 11/05/98 Snyder /McCullaqh 11/12/98 Snyder /Battaglini /Schimpf/ McCullaqh 12/10/98 Snyder /Battaglini /Schimpf 03/10/99 Snyder /McCullagh Snyder 02- 025 -C2 Page 17 74. Business records of EDSPIE detail the following dates Snyder or his associates spent performing work related to the Tech Prep Delaware contract. 75. Snyder's leave records with the Commonwealth were compared with dates when Snyder reportedly performed services on behalf of EDSPIE's contract with the Delaware Tech Prep Program. a. Snyder did not have any recorded leave on November 12, 1998; December 10, 1998; or March 10, 1999, days when he reports working on EDSPIE business while also working for the Commonwealth. b. Snyder asserts that the EDSPIE work conducted on November 12 and December 10, 1998, occurred over dinner and well after his Commonwealth work hours had ended for the day. c. Snyder has no recollection of failing to submit a leave slip for March 10, 1999, and asserts that he never intentionally failed to submit a leave slip for his Commonwealth time. 76. Snyder's payroll history with the Commonwealth confirms Snyder's salary in November 1998 as range 9 step 19 and a biweekly salary of $2,440.50. a. Snyder received a step raise in January 1999 bringing his salary to $2,494.50 biweekly at pay range 9 step 20. 77. Snyder allegedly realized a private pecuniary gain of $737.55 as a result of being compensated by the Commonwealth while performing EDSPIE related business. a. Alleged financial gain based on the following calculations: November 12, 1998 December 10, 1998 March 10, 1999 7.5 hrs. 7.5 hrs. 7.5 hrs. 32.54 per hour 32.54 per hour 33.26 per hour $ 244.05 244.05 249.45 $ 737.55 b. Snyder vigorously disputes that he received any alleged financial gain, but particularly any associated with the November 12 and December 10, 1998, dates on which he met with the EDSPIE associates over dinner and later. Snyder 02- 025 -C2 Page 18 78. Snyder d /b /a EDSPIE submitted two (2) invoices to Tech Prep Delaware pursuant to the November 7, 1998, contract. a. April 15, 1999: $ 15,052.87 July 13, 1999: $ 7,500.00 79. On March 31, 1999, State of Delaware Purchase Order No. 610893 was issued on behalf of Tech Prep Delaware to Michael P. Snyder, 2415 Opal Road, York, PA 17404, in the amount of $22,900.00. a. Description for the purchase order was "contractual arrangement with EDSPIE to provide the services outlined on the attached statement of work for the period August 15, 1998, to January 31, 1999, for Tech Prep Delaware." 80. Tech Prep Delaware received an undated invoice from EDSPIE covering the period July 1, 1998, to December 31, 1998, with total charges in the amount of 15,052.87. Invoiced items include the following: a. Personnel Project Director* Project Staff 14 days at $555 /day 21 days at $500 /day Total No Charge $ 10,500.00 $ 10,500.00 Travel Project Director* 1,557 miles .325¢ /mile $ 499.53 Project Staff 1,570 miles .325¢ /mile $ 510.25 Total $ 1,009.78 Project Director* 4 nights lodging $ 444.97 Project Staff 11 nights lodging $ 1,530.19 Total $ 1,975.16 Project Director* 6 days meals $ 144.50 Project Staff 14 days meals $ 453.46 Total $ 597.96 Communications Printing $ 298.36 Postage $ 94.50 Phone $ 21.20 Final Report $ 442.83 Miscellaneous $ 111.08 Total $ 969.97 Grand Total $ 15,052.87 *Project Director refers to Michael Snyder b. This invoice has "okay" with the initials appearing to be "JC" for James Campbell. c. This EDSPIE invoice was paid by the State of Delaware on or about April 15, 1999, by way of check no. 2723576, also in the amount of $15,052.87. 81. The undated EDSPIE invoice was faxed by Snyder to Vivian Frear, Tech Prep Date Method Source Amount 04/24/99 ATM State of Delaware Invoice for 7/1 /98 — 12/31 /98 $15,052.87 07/26/99 Check State of Delaware .7,500.00 Total: $22,552.87 Snyder 02- 025 -C2 Page 19 Delaware, fax number (302) 739 -6171 from Southwest Rural Tech Prep Consortium on March 23, 1999. a. Snyder included the following note on the fax cover sheet: "Vivian, license and new invoice, invoice covers everything including July meeting. Call me if any questions. Thank you, Michael." b. This fax was sent to Vivian Frear while Snyder was to be performing his official duties for the Commonwealth of Pennsylvania. 82. Snyder submitted an EDSPIE invoice dated July 13, 1999, to the Delaware Tech Prep Program in the amount of $7,500 for fifteen days of project staff at $500 per day. a. This invoice was submitted under the business heading EDSPIE, 205A Tenth Street, New Cumberland, Pennsylvania 17070 and is dated July 13, 1999. b. The accompanying letter from Snyder to Jim Campbell indicates that enclosed was the final invoice for the balance of funds held in escrow for the contract. 83. Delaware Poly Tech School District Tech Prep records issued a payment voucher number 2723287 dated July 14, 1999, in the amount of $7,500 to Snyder. a. The voucher is made payable to Michael P. Snyder, 24150 with a description of final payment for contractual services rendered in accordance with statement of work and the invoice dated 7/13/99. 84. Snyder opened a business checking account at the Pennsylvania State Employees Credit Union in the name of EDSPIE on November 9, 1998. a. The account was opened two days after Snyder finalized his contract with Delaware. b. Snyder is the sole signatory on this account. 85. The only deposits made to the EDSPIE, account from November 1998 through July 1999 were the payments made to EDSPIE by Tech Prep Delaware. a. Deposits 86. Snyder d /b /a EDSPIE deposited the initial $15,052.87 payment from the State of Delaware into the EDSPIE account on April 24, 1999. 87. Upon receipt of the initial payment Snyder distributed funds to EDSPIE associates as follows: Date Check No. Payee Amount Balance 04/24/99 Deposit (N /A) EDSPIE Initial Deposit $ 15,052.87 04/26/99 101 Roy McCullagh $ 4,303.10 $10,749.77 Snyder 02- 025 -C2 Page 20 05/03/99 07/14/99 07/08/99 88. The account identified on 5/03/99 above is an account opened by Michael Snyder at the Pennsylvania State Employees Credit Union on February 22, 1999. a. Melissa Battaglini is listed as a joint owner of that account. 89. The account identified on 7/14/99 above is a personal account of Michael Snyder. a. Snyder has sole signature authority for this account. 90. Snyder deposited the second payment in the amount of $7,500.00 from the State of Delaware into the EDSPIE account on July 14, 1999. 91. Upon receipt of the additional funds, Snyder distributed payments to EDSPIE associates as follows: Date 07/08/99 07/14/99 07/30/99 08/09/99 07/27/99 09/13/99 09/21/99 *balance does 102 103 Transfer Transfer 104 Check No. N/A Deposit 1 106 Transfer Deposit not include Jane Schimpf Melissa Battaglini Acct. Snyder Kinko's Payee Account Balance EDSPIE Roy McCullagh Jane Schimpf Battaglini (Share 01) Unknown Check Delaware Revenue monthly interest credited $ 3,257.31 $ 3,020.00 $ 1,762.00 $ 433.64 $ 55.54 Amount $ 7,500.00 $ 3,064.44 $ 1,369.07 $ 5,250.00 $ 26.35 $ 75.00 from 01/01/99 $ 7,492.46 $ 4,472.46 $ 2,710.46 $ 2,276.82 $ 2,221.28 Balance $ 2,221.28 $ 9,721.28 $ 6,656.84 $ 5,287.77 $ 37.77 $ 64.12 $ 10.88* 92. Snyder directly received $2,195.64 from EDSPIE's Delaware receipts. a. Snyder transferred $1,762.00 from the EDSPIE Acct. to his Snyder /Battaglini joint account on May 3, 1999. b. Snyder transferred $433.64 to his personal account on July 14, 1999. c. Snyder asserts that the payments received by him in relation to the EDSPIE Delaware contract were all reimbursements for actual expenses incurred. 93. Melissa Battaglini received two (2) payments from EDSPIE totaling $8,250.00 to serve as an EDSPIE associate on the Delaware project. a. Battaglini received EDSPIE check number 103 in the amount of $3,020.00 on or about April 26, 1999, and deposited that amount into her personal account. b. Battaglini received $5,250.00 from EDSPIE as a result of a bank transfer on July 27, 1999, from the EDSPIE Acct. to her personal account. 94. Snyder confirmed to Commission investigators that he set up the joint account with Battaglini. a. The main source of deposits into this account were the payments to Battaglini from EDSPIE (Snyder). b. Both Snyder and Battaglini made withdrawals from this account. Snyder 02- 025 -C2 Page 21 95. Snyder also utilized the EDSPIE account for personal use including payments to his attorney, jeweler and MAC withdrawals. a. Snyder asserts that he received advice from his accountant to the effect that the account was a personal account and that such uses of the account were permissible. 96. On January 7, 1999, Snyder received notification from Thomas Carey, Deputy Secretary, that he was the subject of a pre - disciplinary conference. Carey's letter informed Snyder of the allegations he would have the opportunity to respond to which in part included: (1) created a conflict of interest or the perception of a conflict of interest by: a) reviewing and providing guidance and recommended changes to colleagues on an application(s) for competitive grant to establish a School -to -Work Resource Center, and b) advising and assisting another colleague in developing a proposal for a competitive Tech Prep grant and subsequently reviewing and recommending approval for the award of a contract(s) based on this proposal; (2) engaged in supplementary employment without approval; (3) failed to report supplementary employment and income on annual statements of financial interests; (4) misused Commonwealth equipment, supplies and official compensated work time for personal business; engaged in false swearing by affirming and /or certifying that the information on annual Statements of Financial Interests and an application for supplementary employment were true and correct not the best of your knowledge, information and belief and contained no misrepresentations, falsifications, omissions or concealment of material facts; and 97. As part of the pre - disciplinary conference held on January 13, 1999, Snyder offered Deputy Secretary Carey the following explanations and defenses against the allegations against him which in part included: a. He did use phone, fax and Xerox machines on occasion. b. He viewed his work for the State of Delaware as an extension of his graduate studies. (5) c. EDSPIE is a fictitious named company (Education Strategic Planning Implementation and Evaluation). d. He worked with Delaware as a follow -up to previous work. e. EDSPIE's contract was for $22,900, but no money had changed hands. f. He did not check on conflict of interest or have supplemental employment paperwork on file. g. He answered questions from grantees on Requests for Proposals. h. He admitted making comments on a PSU grant application, but claimed no preferential treatment was given to PSU as grants were approved by the inter- Snyder 02- 025 -C2 Page 22 agency team. The grant to Dr. Gray was not competitive. j. He was not officially in Dr. Gray's class, but was taking independent research course. k. Snyder confirmed having a personal relationship with a local tech -prep coordinator (Battaglini), but denied having any say in hiring of local staff. 98. On January 22, 1999, Snyder received a written reprimand from Thomas Carey as a result of the January 13, 1999, pre - disciplinary fact finding conference. Specific reasons for the reprimand and commentary included: a. In early 1997, you performed document analysis services for the State of Delaware's Tech Prep program. You stated that initially you understood that reimbursement of your expenses was the only compensation you would receive; however, after completing the work, you were advised that you would be paid a stipend or honorarium. You admitted that you failed to consult with anyone to determine if accepting such compensation would be appropriate, and you failed to submit a request for and obtain approval of supplementary employment. Additionally, you also failed to report the $600 stipend/honorarium and any other reimbursement for expenses on your 1998 Code of Conduct Statement of Financial Interest. That form specifically requires reporting any non - Commonwealth employment by listing "... all payments, compensation, or consideration of any nature (including but not limited to salaried employment, consultant fees, offices, directorships, honoraria, travel /related expenses and other fees, etc.) earned during the preceding calendar year." Additionally, the Governor's Code of Conduct Part I, Section 7, prohibits employees from accepting "honoraria, speaking fees or any other valuable considerations. Nor shall any ... state employee receive compensation for consultation which draws upon ideas or data derived from his or her official duties." In October 1998, you established an organization entitled Education Strategic Planning, Implementation and Evaluation (EDSPIE) which is registered with the PA Department of State. In September 1998, you negotiated a contract with the Delaware Department of Education, Tech Prep Program in the amount of $22,900 to evaluate the program and prepare a written report. During the PDC, you admitted that you never asked anyone in PDE if this type of activity could be a possible conflict of interest and you did not file a Request for Supplementary Employment prior to establishing EDSPIE or agreeing to the contract with Delaware. It was not until after you were questioned by the OIG that you filed a supplementary employment request for this work after the fact. During the OIG investigation and our PDC, you admitted to using Commonwealth work time and equipment such as the telephone, fax and copier to conduct personal business. While you stated you did so "without thinking about it" and that this misuse of time and equipment was "very" limited, you were aware that this is inappropriate. In fact, the Governor's Code of Conduct, Part I, Section 5, Misuse of Office Facilities and Equipment, specifically prohibits an employee's use of "any Commonwealth equipment, supplies or properties for his or her own private gain or for other than officially designated purposes." During the PDC, you stated that you had forgotten about the requirement to file a supplementary employment request, yet you had done so early in your career with the Department when you worked in a family business. You also stated that you simply forgot about the honoraria /stipend which you received in early Snyder 02- 025 -C2 Page 23 1997 when you filed your financial disclosure form in April 1998. Additionally, you claimed you were unaware of the prohibition against receiving honoraria under the Governor's Code of Conduct. While you indicated you had received a copy of the Employee Handbook which was provided to all employees in January 1997 and contains information on pertinent work - related directives and orders, you failed to read it. 99. Snyder continued his contractual relationship with the State of Delaware even though he received the written reprimand on January 22, 1999, and had his supplemental employment request denied on December 23, 1998. a. Snyder billed the State of Delaware for fifteen (15) days project staff time between January 1, 1999, and July 13, 1999. b. Snyder completed his work d /b /a EDSPIE for Delaware's Tech Prep program with the issuance of a final report dated July 13, 1999. 100. Snyder informed Thomas Carey that he would not be compensated for his work with EDSPIE, but he would receive reimbursement for expenses. a. Snyder's initial contract with Delaware outlined payments to him as Project Director totaling $8,250.00. b. Snyder revised the contract to eliminate compensation for his services after denial of his request for supplemental compensation and he never received those payments. 101. To comply with directives given by Carey, Snyder was not to receive any remuneration. a. No payments were made directly by Snyder to himself from the EDSPIE account. 102. Snyder did make payments from the EDSPIE account to Melissa Battaglini totaling $8,270.00, nearly the identical amount he was to receive as project director. a. Snyder asserts that Battaglini worked on the project an additional eight days beyond that anticipated in the initial contract, and McCullagh worked an additional three days. Additional time was declined by Schimpf - Heiple. Consequently, Battaglini did the bulk of the work in producing the final report. b. Snyder asserts the difference between what Battaglini was projected to receive in the initial contract and what she actually received was only $4,770, an amount not nearly identical to what Snyder was to receive as project director. 103. Even though he was denied supplemental employment approval by the DOE for EDSPIE, Snyder continued his work with EDSPIE for the State of Delaware pending his appeal as heretofore delineated. After the denial of his appeal, Snyder did not disassociate himself from EDSPI E. The following findings relate to Michael Snyder's failure to disclose EDSPIE as a business interests and as a source of income on Statements of Financial Interests 104. Snyder, in his official capacity as the state's school to work coordinator was annually required to file Statements of Financial Interests and Governors Code of Conduct forms. Snyder 02- 025 -C2 Page 24 105. Snyder filed Statements of Financial Interests forms with the Department of Education include the following filings as follows: a. Calendar Year: 1995 Filed: Position: Creditors: Direct /Indirect income: All other financial interests: b. Calendar Year: 1996 Filed: Position: Creditors: Direct /Indirect income: Office, directorship or employment in any business: All other financial interests: c. Calendar Year: 1997 Filed: Position: Creditors: Direct /Indirect income: All other financial interests: d. Calendar Year: 1998 Calendar Year: Filed: Position: Creditors: Direct /Indirect Income: Financial interest in any business: All other financial interests: e. Calendar Year: 1999 Filed: Position: Creditors: Direct /Indirect Income: All other financial interests: April 23, 1996, on SEC Form 1/96 Education Advisor None None None April 17, 1997 on SEC Form 1/97 Education Advisor None PDE York Ice Company, 281 Kings Mill Road, York, Pennsylvania 17403 — Director None April 22, 1998 on SEC Form 1/98 Basic Education Associate None Department of Education None 1998 04/09/99 on SEC Form 1/99 Basic Education Advisor!! None None EDSPIE, 100% None 04/21/00 on SEC Form 1/00 Chief Learning Officer None Department of Education None 106. Snyder failed to list EDSPIE as a business he had an office, directorship or employment interest in on his Statement of Financial Interests filed for calendar year 1999. a. Snyder filed a fictitious name registration for EDSPIE with the Pennsylvania Department of State on October 20, 1998. Snyder 02- 025 -C2 Page 25 107. Snyder failed to list EDSPIE as a source of income in excess of $1,300 on his Statement of Financial Interests filed for calendar year 1999. a. EDSPIE, Snyder's fictitious name entity, received two (2) payments totaling $22,525.87 from the State of Delaware during 1999. 1. $15,052.87 was received by Snyder on or about April 24, 1999. 2. $7,500.00 was received by Snyder on or about July 26, 1999. b. Snyder asserts that he did not believe that he had to report these funds because he received no compensation for services. 108. Snyder also failed to disclose EDSPIE as a business entity in which he had an office, directorship or employment interest on line 13 of the Statement of Financial Interests filed for calendar year 1999. a. Snyder continued d /b /a EDSPIE with the State of Delaware during 1999. 109. Snyder did not disclose on line 14 of the Statement of Financial Interests for 1999 his financial interests in EDSPIE as a legal entity in business for profit. 110. Snyder's failure to disclose occurred after having his supplemental employment request for EDSPIE denied by the Department of Education effective December 28, 1998. 111. Had Snyder disclosed his EDSPIE income and continued financial interests in EDSPIE, he risked further disciplinary action by the Department of Education. 112. Snyder has asserted that: a. He received no gain or compensation from EDSPIE other than reimbursement for out of pocket expenses. b. Any failure to list EDSPIE on his Statement of Financial Interests was an oversight. c. Any violation of the Ethics Law was inadvertent and unintentional in nature. d. He did not use any confidential information for the pecuniary gain of himself or any business with which he was associated. e. He did not, in his STW coordinator position, possess any authority over the State of Delaware which he could have used for his or his business' pecuniary gain. III. DISCUSSION: At all times relevant to this matter, the Respondent, Michael Snyder, hereinafter Snyder, has been a 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 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 Snyder, as Director of the School to Work (STW) Program in the Pennsylvania Department of Education (PDE), violated Sections 3(a)/1103(a); 5(a)/1105(a); 5(b)(5)/1105(b)(5); 5(b)(8)/1105(b)(8); and 5(b)(9)/1105(b)(9) of the Ethics Act Snyder 02- 025 -C2 Page 26 when he: used information from his public position to obtain a contract to provide educational consulting services to the State of Delaware; utilized Commonwealth facilities, equipment and time in conjunction with that contract; failed to disclose on his Statement of Financial Interests (SFI) for the 1999 calendar year his interest and income received from his business, EDSPIE; and participated in actions of PDE in awarding grant funds to his partners in EDSPIE and professors who served on an advisory panel while he was enrolled in a doctoral program. Pursuant to Section 3(a)/1103(a) of the Ethics Act, a public official /public employee is prohibited from engaging in conduct that constitutes a conflict of interest. The term "conflict of interest" is defined under Act 9 of 1989/Act 93 of 1998 as follows: Section 2/1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public f of ce or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. "Conflict" or "conflict of interest" does not include an action having a de minimis economic impact or which affects to the same degree a class consisting of the general public or a subclass consisting of an industry, occupation or other group which includes the public official or public employee, a member of his immediate family or a business with which he or a member of his immediate family is associated. 65 P.S. § 402/65 Pa.C.S. § 1102. Section 3(a)/1103(a) of the Ethics Act prohibits a public official /public employee from using the authority of public office /employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official /public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Section 5(b )/1105(b) of the Ethics Act requires that every public official /public employee and candidate list the name and address of any direct or indirect source of income totaling in the aggregate of $1,000 or more. § 511105. Statement of financial interests (a) Form. - -The statement of financial interests filed pursuant to this chapter shall be on a form prescribed by the commission. All information requested on the statement shall be provided to the best of the knowledge, information and belief of the person required to file and shall be signed under oath or equivalent affirmation. (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 Snyder 02- 025 -C2 Page 27 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. (8) Any office, directorship or employment of any nature whatsoever in any business entity. (9) Any financial interest in any legal entity engaged in business for profit. 65 P.S. §405/65 Pa.C.S. §1105 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. Snyder was employed by PDE from June of 1998 through March of 2000 as a Coordinator of the Commonwealth STW Program which was designed to establish a national framework for comprehensive education reform, and to give all students the opportunity to participate in the performance based education and training program. Snyder's duties and responsibilities included preparing and submitting grant applications to the U. S. Department of Education, serving as the PDE representative to an interagency team, serving as a contact person for partnership coordinators, serving as a liaison between the state and national STW offices and providing oversight of the STW resource center grant and activities. Federal grants were utilized to fund the Commonwealth STW office and provide subgrants to local partnerships. The interagency team's primary responsibility was to review and evaluate grant proposals submitted by local partnerships. The interagency team was comprised of representatives from PDE, Commerce, Labor and Industry, and the Governor's Policy Office. PDE was the department that funded the program. Snyder served as the leader of the interagency team which developed requests for proposals for statewide advertisement. A final decision to award funding for grants was vested with the Secretaries of PDE, Commerce, and Labor and Industry. However, the interagency team determined which projects to submit to the secretaries. STW grants were not only available to provide funding to partnerships but also for research grants as well as funding a resource center. Research grants were awarded to Penn State University (PSU) professors who specialized in workforce development. While Snyder participated in the review and approval of STW grants to PSU as coordinator of the Commonwealth STW office, he was enrolled at PSU as a doctoral candidate. Snyder recommended approval and participated in approving grants to PSU professors who served on his doctoral committee or served as his instructors in classes. PSU submits applications to PDE utilizing set procedures but does not have any guidelines for instructors who receive grant funding by public actions of their students. Snyder did not disclose to anyone in PDE that he was participating as a member of interagency team regarding funding to professors and members on his doctoral committee at PSU while taking classes from those individuals. One of Snyder's professors, Ken Gray, applied for and received a $60,000 grant through PDE's Bureau of Vocational and Technical Education. Snyder reviewed the grant application and recommended approval. Of that amount, $13,517 was specifically budgeted to Gray as project administrator. During that time, Snyder had oversight responsibility as to the grant for his professor. Snyder 02- 025 -C2 Page 28 Richard Walters, another of Snyder's instructors who submitted an application for a grant, sought funding to conduct a study regarding national skills standards for manufacturing. Walters' application included wages for David Passmore who was on Snyder's doctoral committee at the time. However, Walters was not on Snyder's doctoral committee until two years later. A grant in the amount of $228,000 to PSU was awarded for the manufacturing implementation project with Professors Richard Walters and David Passmore being identified in the grant award. In the grant, the sum of $7,250 was specifically budgeted for Passmore under salaries. Subsequently, Walters submitted an additional grant application which the interagency team, including Snyder, approved in the amount of $68,700. Snyder signed as the authorized reviewer for PDE. In another instance, PSU sought funding to locate a technical resource center at its main campus with Roy McCullagh (McCullagh) identified as the project director. Although McCullagh later became involved in a private business venture with Snyder, no such relationship existed at the time of the grant funding. The grant included provisions to hire a consultant for a Power Source software contract. Mary Kisner was identified as the Power Source technical assistant with a budgeted salary of $6,540. Kisner served on Snyder's doctoral committee at the time the interagency team recommended approval of the grant. Kisner was specifically included as part of the grant as a result of direction by Snyder to McCullagh. In summary, Snyder in his official capacity with PDE participated in the review and approval of grants and had supervisory responsibility for grants, which included salaries paid to six of the seven members of his doctoral committee. Separate and apart from the above, Snyder, in August of 1998, approached McCullagh regarding a joint business venture as to consulting for a vocational technical program. After becoming aware of a potential contract through contact with a State of Delaware official, Snyder hoped to obtain a consulting contract with that state as to a technical prep program. Snyder filed a fictitious name application with the Pennsylvania Department of State in October of 1998 for EDSPIE which is an abbreviation for Education Strategy Planning Implementation and Evaluation. Snyder created EDSPIE for the purpose of having an official business name to deal with Delaware's Tech Prep Program. Since employees of PDE are required to obtain agency approval for any supplemental or outside employment, Snyder submitted such a request in December of 1998. The request was submitted six weeks after Snyder had formally entered into a contract with the state of Delaware for the tech prep program to provide consulting services through EDSPIE. On December 28, 1998, Snyder received notification that his request for supplemental employment was disapproved. Snyder nevertheless continued to privately engage as EDSPIE under the State of Delaware contract. Snyder subsequently forwarded a revised agreement to the State of Delaware removing any compensation for his services but providing for the reimbursement of expenses. Snyder used Commonwealth equipment, materials, time, and facilities to conduct EDSPIE business with the State of Delaware's Tech Prep Program. Snyder also used PDE's telephones and faxes to conduct EDSPIE business as detailed in Fact Findings 64 -67. Subsequently, in November 1998, Snyder entered another contract between EDSPIE and James Campbell for Delaware Tech Prep. Although EDSPI E's services for the Delaware Tech Prep Program did not relate to Snyder's responsibility as Director of PDE's STW program, Snyder used the mailing address of the program to receive EDSPIE correspondence from Delaware Tech Prep. A review of the business records of EDSPIE vis -a -vis Snyder's leave records with the Commonwealth reflect that there may have been instances where Snyder performed EDSPIE work during Commonwealth working hours. While the Investigative Division claims that Snyder received a private pecuniary benefit of $737.55 for being compensated by the Snyder 02- 025 -C2 Page 29 Commonwealth while performing private business services for EDSPIE, Snyder denies the charge. Snyder submitted various EDSPIE invoices to Delaware Tech Prep for services performed, one of which was sent while Snyder was performing his official duties for the Commonwealth of Pennsylvania. See, Fact Finding 81.b. Although the payments from Delaware Tech Prep were deposited into a Pennsylvania State Employee Credit Union (PSECU) account opened by Snyder as a personal account, Snyder asserts that the payments received by him in relation to the EDSLPIE Delaware contract were all reimbursements for actual expenses incurred. In January of 1999, Snyder received notification from the PDE Deputy Secretary that he was subject to a predisciplinary conference concerning: conflict of interest as to STW reviews and recommendations of grant applications; supplementary employment without approval; nondisclosure of supplementary employment on his SFI's; misuse of Commonwealth equipment, supplies, and work time for personal business; and false swearing as to information on his SFI's. Following the predisciplinary conference, Snyder received an official written reprimand on January 22, 1999, as detailed in Fact Finding 98. Snyder continued his contractual relationship with the State of Delaware even after he received his written reprimand. Snyder informed Thomas Carey from Delaware that he (Snyder) would not be compensated for his work but that he would receive reimbursements for expenses. However, Snyder made payments from the EDSPIE account to Melissa Battaglini totaling $8,270 which was nearly identical to the amount ($8,250) that he was to receive as project director. Snyder asserts that the difference between what Battaglini was projected to receive and what she actually received was only $4,770. As an employee in PDE, Snyder was required to file SFI's as well as the Governor's Code of Conduct forms. The financial interests that Snyder disclosed on his SFI's with PDE for the calendar years 1995 through 1998 are detailed in Fact Finding 105. For the 1999 calendar year SFI, Snyder failed to list EDSPIE as a business in which he had an office, directorship or employment, a source of income in excess of $1,300, and a legal entity in business for profit. Having highlighted the Stipulated Findings and issues before us, we shall now apply the Ethics Act to determine the proper disposition of this case. The parties' Consent Agreement sets forth a proposed resolution of the allegations. The Consent Agreement proposes that this Commission find: a. That Snyder violated Section 3(a)1103(a) of the Ethics Act, when he used the authority of his public position and information obtained therefrom to secure, for EDSPIE, a business with which he was associated, a contract to provide educational consulting services to the State of Delaware, Department of Education; b. That Snyder did not violate Section 3(a)1103(a) of the Ethics Act, when he participated in actions of the Department of Education, including but not limited to, awarding grant funds to his partners in EDSPIE and professors at Penn State University, who served on an advisory panel while Snyder was enrolled in a doctoral program, as no private pecuniary benefit was received by Snyder or a business with which he was associated; c. That a technical violation of Section 3(a)/1103(a) of the Ethics Act, occurred regarding Snyder's use of Commonwealth facilities in aid of EDSPIE, a business with which he was associated; and d. That Snyder violated Section 5(a)/1105(a) of the Ethics Act, when he failed to disclose on his Statement of Financial Interests for the 1999 calendar year his interest in EDSPIE and income received from EDSPIE. Snyder 02- 025 -C2 Page 30 In addition, Snyder agrees to make payment in the amount of $8,000 in settlement of this matter, payable to the Commonwealth of Pennsylvania, Department of Treasury and forwarded to the Pennsylvania State Ethics Commission within 30 days after the issuance of the final adjudication in this matter. In applying the provisions of the Ethics Act to the instant matter, we shall first address the allegation concerning the review and award of grants to Snyder's partners in EDSPIE and the professors at PSU who served on his advisory panel, followed by the allegation concerning his use of office to obtain a contract with the State of Delaware, then the issue of use of Commonwealth facilities in aid of EDSPIE, and lastly, the failure to disclose financial information related to EDSPIE on his 1999 calendar year SFI. Regarding the grants to Snyder's partners in EDSPIE and the PSU professors on his doctoral advisory panel, there were uses of authority of office on the part of Snyder as to these grants. See, Juliante, Order 809. But for the fact that Snyder was the coordinator of the STW Program and leader of the interagency team, he would not have been in a position to review and be part of the recommendation process as to who would receive such grants. The involvement by Snyder as a public employee resulted in pecuniary benefits to individuals who were partners in EDSPIE or professors on his doctoral advisory panel at PSU. However, the pecuniary benefits did not inure to Snyder himself, any member of his immediate family, or business with which he was associated. Since that key element of the definition of conflict is absent, there can be no violation of Section 3(a)/1103(a) of the Ethics Act. See, Wagner, Order 1028; Perino, Order 980. Accordingly, Snyder did not violate Section 3(a)/1103(a) of the Ethics Act when he participated in actions as to the award of grant funds to partners in EDSPIE or professors at PSU who were on his doctoral advisory panel in that there was no pecuniary benefit received by Snyder, a member of his immediate family, or a business with which he was associated. Turning to the allegation concerning the contract to provide educational consulting services to Delaware, there were uses of authority of office on the part of Snyder. Snyder became aware of the potential Delaware contract after being contacted in his public position by officials from that state. From such information, contacts, and his position, Snyder then filed a fictitious name application for EDSPIE, after such contacts with the appropriate personnel in Delaware resulted in the contract between EDSPIE and the State of Delaware as to the technical prep program. The invoices submitted by Snyder and the payments received from Delaware as to that contract constituted private pecuniary benefits. Lastly, those pecuniary benefits inured to Snyder or EDSPIE, the business with which he is associated as to the Delaware contract. Hence, Snyder violated Section 3/1103 of the Ethics Act when he used the authority of his office and information therein to secure for EDSPIE, a business with which he is associated, a contract to provide educational consulting services to the State of Delaware. Another aspect of the EDSPIE contract concerns uses of authority of office by Snyder as to his performance under the Delaware contract. In particular, Snyder utilized the facilities of the Commonwealth in performing the services by EDSPIE, a business with which he is associated. The record reflects that Snyder used Commonwealth equipment, time, and facilities to conduct the EDSPIE business with Delaware as well as the Commonwealth telephone and fax. See, Fact Finding 63 -64. Snyder may have even performed some of the services on his contract during Commonwealth working hours although he disputes that. Such uses of Commonwealth facilities by Snyder were accomplished by virtue of his being in that Commonwealth position. Such uses of authority of office resulted in private pecuniary benefits in that by using the Commonwealth facilities, Snyder did not have any out of pocket expenses in paying for such facilities and equipment. Lastly, the private pecuniar y benefits inured to Snyder /EDSPIE. Accordingly, Snyder technically violated Section 3(a)/1103(a) of the Ethics Act by using Commonwealth facilities in aid of EDSPIE, a business with which he is associated. See, Heck, Order 1251. Snyder 02- 025 -C2 Page 31 The last item before us concerns the SFI allegation regarding Snyder's interest in EDSPIE as to the 1999 calendar year SFI. The record reflects that Snyder failed to list EDSPIE as a source of income, as a legal entity engaged in business for profit, and as a business entity in which he had an office, directorship or employment. Accordingly, Snyder violated Section 5(a)/1105(a) of the Ethics Act when he failed to disclose on his 1999 calendar year SFI his income and interest in EDSPIE, that is, income, a legal entity engaged in business for profit, and business entity in which he had an office, directorship, or employment. 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, Snyder is directed to make payment in the amount of $8,000 to the Commonwealth of Pennsylvania, Department of Treasury through this Commission within 30 days of the mailing date of this Order. In addition, Snyder is directed to file within 30 days of the mailing of this Order an amended SFI for the 1999 calendar year correcting the deficiencies noted above. Compliance by Snyder as to both the payment of the $8,000 as well as the filing of the amended SFI will result in the closing of this case with no further action. Non - compliance will result in the institution of an order enforcement action. In that Snyder continues as a public employee of the Commonwealth of Pennsylvania, he is reminded that public office is a public trust and that he must comport his future actions so as to ensure that he is both within the letter and spirit of the Ethics Act. IV. CONCLUSIONS OF LAW: 1. Snyder, as a Director of the Pennsylvania Department of Education's School to Work Program, was during the relevant time period a public employee subject to the provisions of Act 9 of 1989 as codified by Act 93 of 1998. 2. Snyder did not violate Section 3(a)/1103(a) of the Ethics Act when he participated in actions of the PDE as to the award of grant funds to partners in EDSPIE or professors at PSU who were on his doctoral advisory panel in that there was no private pecuniary benefit received by Snyder, a member of his immediate family, or a business with which he was associated. 3. Snyder violated Section 3/1103 of the Ethics Act when he used the authority of his office and information therein to secure for EDSPIE, a business with which he is associated, a contract to provide educational consulting services to the State of Delaware, Department of Education. 4. Snyder technically violated Section 3(a)/1103(a) of the Ethics Act when he used Commonwealth facilities in aid of EDSPIE, a business with which he is associated. 5. Snyder violated Section 5(a)/1105(a) of the Ethics Act as to his 1999 calendar year SFI when he failed to list EDSPIE as a business in which he had an office, directorship or employment, a source of income in excess of $1,300, and a legal entity in business for profit. In Re: Michael Snyder ORDER NO. 1284 File Docket: 02- 025 -C2 Date Decided: 6/23/03 Date Mailed: 7/8/03 1. Snyder, as a Director of the Pennsylvania Department of Education's School to Work Program, did not violate Section 3 (a)/1103(a) of the Ethics Act when he participated in actions of the PDE as to the award of grant funds to partners in EDSPIE or professors at PSU who were on his doctoral advisory panel in that there was no private pecuniary benefit received by Snyder, a member of his immediate family, or a business with which he was associated. 2. Snyder violated Section 3/1103 of the Ethics Act when he used the authority of his office and information therein to secure for EDSPIE, a business with which he is associated, a contract to provide educational consulting services to the State of Delaware, Department of Education. 3. Snyder technically violated Section 3(a)/1103(a) of the Ethics Act by using Commonwealth facilities in aid of EDSPIE, a business with which he is associated. 4. Snyder violated Section 5(a)/1105(a) of the Ethics Act as to his 1999 calendar year SFI when he failed to list EDSPIE as a business in which he had an office, directorship or employment, a source of income in excess of $1,300, and a legal entity in business for profit. 5. As per the Consent Agreement of the parties, Snyder is directed within 30 days of the mailing of this Order to make payment in the amount of $8,000 to the Commonwealth of Pennsylvania, Department of Treasury through this Commission. 6. Snyder is directed to file within 30 days of the mailing of this Order an amended Statement of Financial Interests for the 1999 calendar year correcting the deficiencies noted above. 7. Compliance by Snyder as to both the payment of the $8,000 as well as the filing of the amended SFI will result in the closing of this case with no further action. Non- compliance will result in the institution of an order enforcement action. BY THE COMMISSION, Louis W. Fryman, Chair