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HomeMy WebLinkAbout1835 ShirnPHONE: 717-783-16,10 TOLL FREE: 1-.800-932-0936 In Re: David W. Shim, Respondent STNrE ETHICS COMMISSION FINANCE BUILDING 613 NOR11i STREET, ROOM 309 HARRISBURG, PA 17120-0400 File Docket: Order No. Date Decided Date Mailed: 22-0026-C 1835 4/9/24 4/19/24 Before: Michael A. Schwartz, Chair Rhonda Hill Wilson, Vice Chair David L. Reddecliff Emilia McKee Vassallo Thomas E. Leipold This is a final adjudication of the State Ethics Commis,sion.1 FACSIMILE: 717-787-0806 WEBSiTE: wwW.oth1rs,pgM Procedurally, the Investigative Division of the State Ethics Commission conducted an investigation regarding possible violation(s) of the Public Official and Employee Ethics Act ("'Ethics Act"), 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. Upon completion of its investigation, the Investigative Division issued and served upon Respondent a Findings Report identified as an "Investigative Complaint." An Answer was filed, and a hearing was held. Both parties filed written Closing Statements and Post -Hearing Briefs, and both parties participated in oral argument before the Commission at its April 9, 2024 meeting. The record is complete. 1. ALLEGATIONS: That David W. Shim, a public official as a Member of the Board of Supervisors ("Board") of Old Lycoming Township ( ... l'ownship"), Lycoming County, violated Sections 1 103(a), 1103(0, 1104(a), 1105(b)(5), 1105(b)(8) and 1105(b)(9) of the Ethics Act: (1) When he used the authority of his public office by participating in discussions and actions of the Township to enter into a contract with Shim's, a vehicle dealership with which he and/or members of his immediate family are associated, resulting in a private pecuniary benefit to himself, members of his immediate family and/or Shirn's; (2) When he, through Shim's vehicle dealership, entered into a contract valued at more than $500.00 with the Township without an open and public process; I Commissioner Robert P. Caruso recused himself frorn this matter and did not participate in the deliberations involving this case. Shire, 22-0026-C Page 2 (3) When he failed to file required Statements of Financial Interests ("SFIs") for the 2017, 2018, and 2019 calendar years; (4) When he filed a deficient SFI intended for calendar year 2020 by failing to report all office, directorship, or employment in any business and the identity of all financial interest in a business engaged for profit; and (5) When he filed deficient SFIs intended for calendar years 2020 and 2021 by reporting the incorrect calendar year on the forms and failing to list all sources of direct/indirect income. II. FINDINGS: A. Relevant Admitted Pleadings 1. David W. Shire ("Shire" or "Respondent") has sewed as a Member of the Old Lycoming Township ("Township") Board of Supervisors ("Board"), Lycoming County, since approximately November 2017. 2. The Township is a Second Class Township governed by a three -Member Board. 3. Shire also is President of Lock -Cuff, Inc., a trucking company. 4. Articles of Incorporation for Shim's Pontiac-GMC, Inc. ("Shim's"), located at 1804 Lycoming Creels Road, Williamsport, PA 17701, were filed with the Pennsylvania Department of State on April 24, 1972.2 a. Corporate officers are as follows: David M. Shire, President; David W. Shim/Respondent, Vice President; and Sue A. Shire, Secretary and Treasurer. b. David M. Shire is Respondent's father. c. Sue A. Shire is Respondent's sister. 5. In 2018, Township administration and the Board determined that a need existed for a vehicle to be used by employees on Township business in lieu of using personal vehicles. a. Shire participated in discussions regarding the need for a vehicle in his official capacity as a Member of the Board. 2 Although the 1972 Articles of Incorporation list Respondent as the Vice President and his father as President, Respondent identified himself as the President of Shim's on Statements of Financial interests filed in 2017, 2021, and 2022. See, Exhibits ID -- 8, ID — t0, and ID — 12. Shirn, 22-0026-C Page 3 Then -Township Manager Robert Whitfield ("Whitfield") drove by a local used vehicle dealership (not Shim's) in or around May 2018 looking for a used 4-wheel drive or all - wheel drive vehicle for purchase by the Township. a. Whitfield was unable to locate a suitable vehicle for sale under $10,000.00. b. The Township did not seek out any used vehicles on Municibid, a website used by municipal entities to buy and sell unwanted vehicles, equipment, and materials. 7. On June 2, 2018, Shim's provided a quote to the Township in the amount of $4,600.00 for a 2003 Pontiac Vibe. a. The quote is signed by Whitfield. b. Notations on the quote reflect that $4,600.00 was paid on August 1, 2018 by Township check number 19887. On June 6, 2018, Shim's submitted an invoice to the Township in the amount of $4,600.00 for a 2003 Pontiac Vibe. a. The invoice was signed by Whitfield. b. The vehicle is reported as being "Sold As Is, No Warranty". c. The stated odometer reading at the time of sale was 135,544 miles. d. Included with the June 6, 2018 invoice is a "Buyer's Guide" for the vehicle signed by Whitfield. e. Shim personally delivered the vehicle to the Township building. 9. On August 1, 2018, the Township issued check number 19887 in the amount of $4,600.00 to Shim's, 1804 Lycoming Creek Road, Williamsport, PA 17701, for the vehicle. a. This check was manually signed by Shim, as well as Township Supervisor Sam Aungst ("Aungst") and Treasurer Debra Shilling ("Shilling"). 10. Shim provided business records outlining the operating expenses Shim's incurred in its acquisition of the 2003 Pontiac Vibe. a. The dealership acquired the vehicle at auction on or about April 6, 2017 for the sum of $3,210.20. b. After the dealership acquired the vehicle, Shim's performed repairs on the vehicle on four occasions. Shire, 22-0026-C Page 4 c. Shim's was unable to sell the vehicle and it remained in the dealership's used vehicle inventory for fourteen months until being sold to the Township. 11. The Township maintained ownership of the vehicle until October 13, 2020, when it sold the vehicle on Municibid for $3001.00. THE FOLLOWING FINDINGS RELATE TO ALLEGATIONS THAT SHIRN FAILED TO FILE STATEMENTS OF FINANCIAL INTERESTS FOR CALENDAR YEARS 2017, 2018, AND 2019 AND FILED DEFICIENT STATEMENTS OF FINANCIAL INTERESTS FOR CALENDAR YEARS 2020 AND 2021. t2. Shinn, in his official capacity as a Member of the Board was annually required to file a Statement of Financial Interests ("SFI") by May I" each year. 13. Township public officials and employees are annually provided blank SFIs to complete each January by the Township's administrative staff. a. Shinn was annually provided a blank SFI form to complete. 14. Shim's SFIs have the following known reporting deficiencies; a. Shiro reported the wrong calendar year in Block 7 on SFI forms intended for the 2020 and 2021 calendar years. b. Shinn failed to report Lock -Cuff, Inc., Old Lycoming Township, and Shim's vehicle dealership as direct/indirect sources of income over $1,300.00 in Block 10 of his SFI intended for the 2020 calendar year. c. Shinn failed to report Old Lycoming Township as a direct/indirect source of income over $t,300.00 in Block 10 of his SFI intended for the 2021 calendar year. d. Shinn failed to report his Office, Directorship, or Employment as the President of Lock - Cuff, Inc. in Block 13 of the SFI intended for the 2020 calendar year. e. Shinn failed to report his financial interest in Shim's vehicle dealership on the SFI intended for the 2020 calendar year. 15. Shinn earned the following income for calendar years 2018 through 2022 as a Member of the Board: a. 2018 - $2,500.00; b. 2019 - $2,500.00; c. 2020 - $2,499.66; Shim, 22-0026-C Page S d. 2021 - $2,500,00; and e. 2022 - $1,053.36. B. Testimony 16. Robert Whitford ("Whitford"), was the Township Manager for Old Lycoming Township for ten years, including during the time period in question in this matter. a. As Township Manager, he was responsible for overseeing the day-to-day operations of the Township, including the purchase of Township vehicles. b. When purchasing new vehicles, the Township would put out a request for proposals; however, when the Township was looking to purchase a used vehicle, the Township would utilize Municibid or other local vendors. c. Occasionally, the Township would repurpose old police vehicles for use by the Township. d. In or around 2018, the Township was in need of a four wheel or all -wheel drive vehicle for code enforcement and other Township business. i. There were no vehicles suitable for repurposing at that time. ii. The Township did not put out a request for proposals; instead, Whitford walked through one local used car lot but did not find anything that would suit the Township's needs. iii. Whitford did not recall whether the Township looked on Municibid for a suitable vehicle to purchase. e. Whitford worked directly with Shim about purchasing a vehicle for code enforcement and other Township business in 2018. i. Shim advised that his and his father's car lot had a vehicle that would suit the Township's needs and budget. ii. Shim provided a quote for the vehicle on June 2, 2018. iii. Exhibit ID — 1 is a copy of quote/invoice for the purchase of a 2003 Pontiac Vibe from Shim's vehicle dealership for $4,600.00. iv. Whitford did not make an offer on the vehicle and did not attempt to negotiate a lower price. Shire, 22-0026-C Page 6 f. Shim provided an invoice for the purchase of the 2003 Pontiac Vibe to the Township on June 6, 2018. i. Exhibit ID — 2 is a copy of an invoice from Shim's vehicle dealership for the purchase of a 2003 Pontiac Vibe by the Township. ii. Whitford signed the invoice for the vehicle which was "Sold As Is. No Warranty." iii. The invoice contained the name of Randy Moser as the vehicle salesperson. iv. Whitford also signed a copy of the Buyer's Guide provided by Shim's at the time of purchase of the vehicle. (Exhibit ID — 3) g. The Board of Supervisors voted to approve the purchase of a vehicle at a meeting on July 10, 2018, more than one month after Whitford already had signed the invoice to purchase the vehicle at Shim's dealership. L Exhibit ID — 4 is a copy of the minutes of the July 10, 2018 Board meeting in which the Board voted to purchase a vehicle for no more than $5,000.00. ii. Aungst made the motion to begin looking for a vehicle for no more than $5,000.00 and Shire seconded the motion, which carried 3-0. iii. There is no mention of the purchase of a vehicle from Shim's in the July 10, 2018 meeting minutes. h. On July 25, 2018, Whitford completed a purchase order of $4,600.00 for the 2003 Pontiac Vibe, which was signed by Shire and Aungst. (Exhibit ID -- 5) i. Sometime after the purchase of the vehicle, the Township mechanic identified some mechanical issues with the vehicle. i. The vehicle was returned to Shim's for the repairs. ii. The Township did not receive an invoice for the repairs made by Shim's. 17. Sam Aungst ("Aungst") was a Township Supervisor from 2016 through April 2021. a. He became aware that the Township was purchasing a vehicle from Shim's in July 2018. i. He signed the purchase order to purchase a 2003 Pontiac Vibe from Shim's following the July Board meeting in which the Board voted to purchase a vehicle at a cost not to exceed $5,000.00. Shire, 22-0026-C Page 7 ii. Once a purchase order is signed, it is forwarded to the Treasurer to issue the check, which is then signed by two Township Supervisors and the Treasurer. iii. Exhibit ID — 6 is a copy of a check dated and issued on August 1, 2018 by Old Lycoming Township to Shim's in the amount of $4,600.00. (a) The check was signed by Shire, Aungst, and the Treasurer Debra Schilling. b. Checks for the prior month are included in the accounts payable for the following month's Board meeting. i. The August 1, 2018 check to Shim's should have been included under accounts payable for the September 11, 2018 meeting, however Aungst did not remember it being listed. ii. Typically, there is an itemized list of the items in the accounts payable for each month. iii. Exhibit ID ---- 7 is a copy of the minutes of the September 11, 2018 Board meeting. Shim seconded the motion to approve the accounts payable for August 2018. iv. There is no mention of the vehicle purchase from Shim's in the September 11, 2018 Board meeting minutes. c. Although there was some discussion about reputposing a police cruiser for use by code enforcement, there were no other specific options or monetary figures presented to the Board other than the 2003 Pontiac Vibe from Shim's. 18. Linda Mazzullo ("Mazzullo") was a Township Supervisor from 2012 through 2022. a. Prior to becoming a Township Supervisor, Mazzullo was the Township Manager for ten years. b. Whitford informed her that Shim had a vehicle the Township was looking to purchase for code enforcement. i. Mazzullo immediately stated that this was a conflict of interest and they would have to look elsewhere for a vehicle. ii. Shim stated that it was not a conflict of interest because his father owned the business; however, Mazzullo advised that it was a conflict of interest because Shim's was a business with which he was associated and because Shim worked there. Shirn, 22-0026-C Page 8 iii. Mazzullo had no further involvement regarding the purchase of a vehicle from Shim's. c. Mazzullo was not aware that the Township had agreed to purchase the vehicle from Shim's until late June or early July 2018. i. At the July 10, 2018 meeting of the Board, she voted to approve the purchase of a vehicle for no more than $5,000.00 and advised Whitford to provide some bids on vehicles. ii. She was never provided with any bids or proposals as requested. iii. She was never provided a copy of the June 6, 2018 invoice from Shim's for the purchase of a 2003 Pontiac Vibe and was not aware that the Township paid for the vehicle. iv. Typically two supervisors and the treasurer signed all Township checks. d. Generally there was a separate accounts payable report in which all expenses due for payment were itemized and available for review by Board members prior to a monthly meeting. 19. Daniel Bender ("Bender") is a Senior Special Investigator and Training Officer for the Pennsylvania State Ethics Commission. a. Bender was involved in the Investigative Division's investigation of Shim. i. During the course of his investigation, Bender reviewed various Township Board meeting minutes, b. Shim informed Bender that he is a vehicle salesperson at Shim's and handles the day- to-day operations of the business. i. Shim is identified as the Vice President of Shim's on documents maintained by the Department of State. c. Shim also is President of Lock -Cuff, Inc., a trucking business. d. As part of the investigation, Bender obtained various Statements of Financial Interests ("SFIs") of Shim; however, he did not receive or locate SFIs for calendar years 2017, 2018, or 2019. i. Exhibit ID — 8 is an SFI that Shim filed for calendar year 2016 in which he identifies himself as the President of Shim's. Shim, 22-0026-C Page 9 a. Shim identifies Lock -Cuff, Inc., as a source of direct or indirect income and a business in which he holds 100% financial interest. ii. Exhibit ID — 9 is an amended SFI that Shim filed for calendar year 2020, a. This SFI is signed and dated September 2, 2023. b. Shim identifies himself as a salesperson at Shim's, Township Supervisor for Old Lycoming Township, President of Lock -Cuff, Inc., and Treasurer of Dog Run Energy. c. Shim lists the following sources of direct or indirect income; Shim's Pontiac- GMC, Inc.; Old Lycoming Township; Lock -Cuff, Inc., and Dog Run Energy. d. Shinn lists Lock -Cuff, Inc,, as a business in which he holds an Office, Directorship or Employment and in which he holds a financial interest. iii. Exhibit ID — 10 is an SFI that Shim filed purportedly for calendar year 2021; however, it is signed and dated by Shim on January 31, 2021. a. Shim identifies himself as President of Shim's in Block 13 of this SFI. b. Shim lists Lock -Cuff, Inc., as a business in which he has a financial interest but does not include this business in Block 13 even though he is President of the company. iv. Exhibit ID — 11 is an amended SFI that Shim filed for calendar year 2021. a. This SFI is signed and dated September 2, 2023. b. Shim identifies himself as a Township Supervisor for Old Lycoming Township, President of Lock -Cuff, Inc., and Treasurer of Dog Run Energy. c. Shim lists the following sources of direct or indirect income: Old Lycoming Township; Lock -Cuff, Inc., and Dog Run Energy. d. Shim lists Lock -Cuff, Inc., as a business in which he holds an Office Directorship or Employment and in which he holds a financial interest. v. Exhibit ID — 12 is an SFI that Shim filed purportedly for calendar year 2022; however, it is signed and dated by Shim on April 25, 2022. a. Shim identifies himself as a "Twp Supervisor/Truck Sales Shim's" as his occupation. Shinn, 22-0026-C Page 10 b. Shinn lists Shim's Pontiac-GMC and Lock -Cuff, Inc. as sources of direct or indirect income and identifies himself as the President of both businesses. c. Shinn lists Shim's Pontiac-GMC and Lock -Cuff, Inc, as businesses in which he holds an Office, Directorship or Employment and in which he holds financial interests. vi. Exhibit ID — 13 is an amended SFI filed by Shinn for calendar year 2022. a. This SFI is signed and dated September 2, 2023. b. Shinn identifies himself as a Township Supervisor for Old Lycoming Township, President of Lock -Cuff, Inc., and Treasurer of Dog Run Energy. c. Shinn lists the following sources of direct or indirect income: Old Lycoming Township; Lock -Cuff, Inc., and Dog Run Energy. d. Shinn lists Lock -Cuff, Inc., as a business in which he holds an Office, Directorship or Employment and in which he holds a financial interest. e. With respect to the Township's purchase of the 2003 Pontiac Vibe, Shirrs personally delivered the vehicle to the Township. f. Shinn claimed to have a loss of at least $100.00 on the sale of the vehicle to the Township. i. The acquisition cost of the vehicle was approximately $3,200.00. ii. The vehicle stayed on Shim's sales' lot for approximately fourteen months with an asking price of $5,900.00 before it was sold to the Township in 2018. iii. Shim's repaired various mechanical issues that arose following the sale of the vehicle to the Township and did not charge the Township for the repairs. g. The Township sold the vehicle for $3,001.00 through Municibid in October 2020. C. Exhibits 20. ID — 1 is a copy of quote/invoice for the purchase of a 2003 Pontiac Vibe from Shim's vehicle dealership for $4,600.00. a. The quote/invoice is dated June 2, 2018. b. Old Lycoming Township is identified as the purchaser of the vehicle, and the quote/invoice is signed by Robert Whitford, Township Manager. SWm, 22-0026-C Page t I c. The quote/invoice contains the following handwritten notation: Paid $4600.00 8/1/18 #19887 H406260 21. ID — 2 is a copy of an invoice from Shim's vehicle dealership for the purchase of a 2003 Pontiac Vibe by the Township for $4,600.00. a. The invoice is dated June 6, 2018. b. Old Lycoming Township is identified as the purchaser of the vehicle and the invoice is signed by Robert Whitford, Township Manager. c. The invoice indicates that the vehicle is being "Sold As Is. No Warranty." d. The invoice contained the name of Randy Moser as the vehicle salesperson. 22. ID — 3 is a copy of the 2003 Pontiac Vibe Buyer's Guide, which is signed by Robert Whitford, Township Manager. 23. ID — 4 consists of the minutes of the July 18, 2020 Township Board meeting which provide, in pertinent part, as follows: Municipal _ Vehicle — A decision was made to purchase a vehicle for township employees to use while doing township business. The vehicle will be used instead of the employee's personal vehicle. The Township will begin the (sic) looking for a vehicle to purchase for no more than $5,000.00. Sam Aungst made a motion to purchase a township vehicle for no more than $5,000.00. Dave Shirrs seconded the motion. Motion carried 3 to 0. (Emphasis Added), ID — 4, p. 2. 24. ID — 5 is a copy of a July 25, 2018 purchase order in which the Board agreed to purchase the 2003 Pontiac Vibe from Shim's for $4,600.00. a. The purchase order is signed by Shirrs and Aungst. 25. ID — 6 is a copy of a check in the amount of $4,600.00 payable to Shim's and signed by Shirrs, Aungst, and Treasurer Shilling. a. The check from the Township is dated August 1, 2018. Shire, 22-0026-C Page 12 b. Below the check is the following information: Invoice PO Date Amt Paid UCQ384 03 Pontiac Vibe 02-Jun-18 $4,600.00 26. ID — 7 consists of the minutes of the September 11, 2018 Township Board meeting which provide, in pertinent part, as follows: Accounts Paya_b_le: August 2018 -- Linda Mazzullo motion to approve Accounts Payable for August 2018. Dave Shire seconded. Motion carried 3-0. Accounts Payable $167,134.54 Payroll $167,809.10 Total $334,942.64 ID — 7, p. 4. 27. ID — 8 is an SFI for Shim for calendar year 2016. a. On this form, for Block 6, pertaining to "Occupation or Profession," Shim identified himself as the sales manager and President of Shine's. b. On this form, for Block 10, pertaining to "Director Indirect Sources of Income," Shim listed "Lock -Cuff, Inc." c. On this form, for Block 14, pertaining to "Financial Interest in Any Legal Entity in Business for Profit," Shim listed Lock -Cuff, Inc., a business in which he held 100% interest. 28. ID — 9 is an amended SFI for Shinn for calendar year 2020. a. This form is signed and dated September 2, 2023. b. On this form, for Block 6, pertaining to "Occupation or Profession," Shirn identified himself as a salesperson at Shirn's, Township Supervisor for Old Lycoming Township, President of Lock -Cuff, Inc., and Treasurer of Dog Run Energy. On this form, for Block 10, pertaining to "Direct or Indirect Sources of Income," Shim listed Shirn's Pontiac-GMC, Inc.; Old Lycoming Township; Lock -Cuff, Inc., and Dog Run Energy. hirn, 22-0026-C Page 13 d. On this form, for Block 13, pertaining to "Office, Directorship or Employment in any Business," Shim listed Lock -Cuff, Inc. and identified himself as the President of the company holding 100% interest. On this form, for Block 14, pertaining to "Financial Interest in any Legal Entity in Business for Profit," Shim listed Lock -Cuff, Inc. 29. ID ----10 is an SFI for Shim purportedly for calendar year 2021. a. This SFI is signed and dated January 31, 2021. b. On this form, for Block 6, pertaining to "Occupation or Profession," Shim identified "Retail Sale and Trucking." c. On this form, for Block 10, pertaining to "Director Indirect Sources of Income," Shim identified himself as "unemployed "state." d. On this forth, for Block 13, pertaining to "Office, Directorship or Employment in any Business," Shim listed "Shirn's" and described himself as being a salesperson/president. c. On this form, for Block 14, pertaining to "Financial Interest in any Legal Entity in Business for Profit," Shim listed Lock -Cuff, Inc. and described himself as the President of this business. 30. ID — 1 I is an amended SFI for Shim for calendar year 2021. a. This SFI was signed and dated September 2, 2023. b. On this form, for Block 6, pertaining to "Occupation or Profession," Shim identified himself as a Township Supervisor for Old Lycoming Township, President of Lock - Cuff, Inc., and Treasurer of Dog Run Energy. f. On this form, for Block 10, pertaining to "Director Indirect Sources of Income," Shim listed Old Lycoming Township, Lock -Cuff, Inc., and Dog Run Energy. g. On this form, for Block 13, pertaining to "Office, Directorship or Employment in any Business," Shim listed Lock -Cuff, Inc. and identified himself as the President of the company holding 100% interest. On this form, for Block 14, pertaining to "Financial Interest in any Legal Entity in Business for Profit," Shim listed Lock -Cuff, Inc. 31. ID — 12 is an SFI for Shim purportedly for calendar year 2022. d. This SFI is signed and dated April 25, 2022. Slum, 22-0026-C Page 14 e. On this form, for Block 6, pertaining to "Occupation or Profession," Shirrs identified "Twp Supervisor/Truck Sales Shim's." f. On this form, for Block 10, pertaining to "Director Indirect Sources of Income," Shirrs identified Shim's Pontiac-GMC and Lock -Cuff, Inc. g. On this form, for Block 13, pertaining to "Office, Directorship or Employment in any Business," Shirrs listed Shim's Pontiac GMC and Lock -Cuff, Inc. and described himself as being President of both businesses. h. On this form, for Block 14, pertaining to "Financial Interest in any Legal Entity in Business for Profit," Shirrs stated "same as above" for Block 13. 32. ID — 13 is an amended SFI for Shire for calendar year 2022. i. This SFI was signed and dated September 2, 2023. j. On this form, for Block 6, pertaining to "Occupation or Profession," Shirrs identified himself as a Township Supervisor for Old Lycoming Township, President of Lock - Cuff, Inc., and Treasurer of Dog Run Energy. h. On this form, for Block 10, pertaining to "Director Indirect Sources of Income," Shire listed Old Lycoming Township, Lock -Cuff, Inc., and Dog Run Energy. i. On this form, for Block 13, pertaining to "Office, Directorship or Employment in any Business," Shirrs listed Lock -Cuff, Inc. and identified himself as the President of the company holding 100% interest. a. On this form, for Block 14, pertaining to "Financial Interest in any Legal Entity in Business for Profit," Shirrs listed Lock -Cuff, Inc. 33. R -- 1 appears to be various invoices and records for service performed by Shim's on an unidentified vehicle. The VIN number appears to match that of the 2003 Pontiac Vibe. a. According to these documents, Shim's performed repairs totaling approximately $1,500.00 on this vehicle. 1QI. DISCUSSION: As a Member of the Board of Supervisors of Old Lycoming Township ("Township") since November 2017, Respondent David W. Shim ("Shirrs") has been a public official subject to the provisions of the Public Official and Employee Ethics Act ("Ethics Act"), 65 Pa.C.S. § 1101 et sec .. Shire, 22-0026-C Page 15 The allegations as set forth in the Investigative Complaint/Findings Report are that Shire violated Sections 1103(a), 1103(f), 1104(a), 1105(b)(5), 1105(b)(8) and 1105(b)(9) of the Ethics Act: (1) When he used the authority of his public office by participating in discussions and actions of the Township to enter into a contract with Shim's, a vehicle dealership with which he and/or members of his immediate family are associated, resulting in a private pecuniary benefit to himself, members of his immediate family and/or Shim's; (2) When he, through Shim's vehicle dealership, entered into a contract valued at more than $500.00 with the Township without an open and public process; (3) When he failed to file required Statements of Financial Interests ("SFIs") for the 2017, 2018, and 2019 calendar years; (4) When he filed a deficient SFI for calendar year 2020 by failing to report all office, directorship, or employment in any business and the identity of all financial interest in a business engaged for profit; and (5) When he filed deficient SFIs for calendar years 2020 and 2021 by reporting the incorrect calendar year on the forms and failing to list all sources of direct/indirect income. Pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is prohibited from engaging in conduct that constitutes a conflict of interest: § 1103. Restricted activities (a) Conflict of interest. -No public official or public employee shall engage in conduct that constitutes a conflict of interest. 65 Pa.C.S. § 1103(a). The term "conflict" or "conflict of interest" is defined in the Ethics Act as follows: § 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public office or employment for the private pecuniary benefit of himself, a member of his immediate family or a business with which he or a member of his immediate family is associated. 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 Shirr, 22-0026-C Page 16 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. "Authority of office or employment." The actual power provided by law, the exercise of which is necessary to the performance of duties and responsibilities unique to a particular public office or position of public employment. "Business." Any corporation, partnership, sole proprietorship, firm, enterprise, franchise, association, organization, self-employed individual, holding company, joint stock company, receivership, trust or any legal entity organized for profit. "Business with which he is associated." Any business in which the person or a member of the person's immediate family is a director, officer, owner, employee or has a financial interest. "Immediate family." A parent, spouse, child, brother or sister "De minimis economic impact." An economic consequence which has an insignificant effect. 65 Pa.C.S. § 1102. Subject to the statutory exclusions to the Ethics Act's definition of the term "conflict" or "conflict of interest, 65 Pa.C.S. § 1102, pursuant to Section 1103(a) of the Ethics Act, a public official/public employee is prohibited 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. The use of authority of office is not limited merely to voting but extends to any use of authority of office including, but not limited to, discussing, conferring with others, and lobbying for a particular result. Juliante, Order 809. Section 1103(f) of the Ethics Act, pertaining to contracting, provides as follows: § 1103. Restricted activities (f) Contract. --No public official or public employee or his spouse or child or any business in which the person or his spouse or child is associated shall enter into any contract valued at $500 or more with the governmental body with which the public official or Shiers, 22-0026-C Page 17 public employee is associated or any subcontract valued at $500 or more with any person who has been awarded a contract with the governmental body with which the public official or public employee is associated, unless the contract has been awarded through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded. In such a case, the public official or public employee shall not have any supervisory or overall responsibility for the implementation or administration of the contract. Any contract or subcontract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of the making of the contract or subcontract. 65 Pa.C.S. § 1103(f). The term "contract" is defined in the Ethics Act as follows: § 1102. Definitions "Contract." An agreement or arrangement for the acquisition, use or disposal by the Commonwealth or a political subdivision of consulting or other services or of supplies, materials, equipment, land or other personal or real property. The term shall not mean an agreement or arrangement between the State or political subdivision as one party and a public official or public employee as the other party, concerning his expense, reimbursement, salary, wage, retirement or other benefit, tenure or other matters in consideration of his current public employment with the Commonwealth or a political subdivision. 65 Pa.C.S. § 1102. Section 1103(f) does not operate to make contracting with the governmental body permissible where it is otherwise prohibited. Rather, where a public official/public employee, his spouse or child, or a business with which he, his spouse or child is associated, is otherwise appropriately contracting with the governmental body, or subcontracting with any person who has been awarded a contract with the governmental body, in an amount of $500.00 or more, Section 1103(f) requires that an "open and public process" be observed as to the contract with the governmental body. Section 1103(f) of the Ethics Act also provides that the public official/public employee may not have any supervisory or overall responsibility as to the implementation or administration of the contract with the governmental body. Section I104(a) of the Ethics Act requires public employees or public officials to file an SFI with the governing authority of the political subdivision by which he is employed or within which he is appointed or elected no later than. May I of each year that he holds such a position and of the year after he leaves such a position. Shirn, 22-0026-C Page 18 Section 1105(b)(5) of the Ethics Act requires the filer to disclose on the SFI the name and address of any direct or indirect source of income totaling in the aggregate $1,300.00 or more. Section 1105(b)(8) of the Ethics Act requires the filer to disclose on the SFI any office, directorship or employment of any nature whatsoever in any business entity. Section 1105(b)(9) of the Ethics Act requires the filer to disclose on the SFI any financial interest in any legal entity. Motion to Dismiss As a preliminary matter, Shim has filed a motion to dismiss this matter on the basis that he was not provided with adequate Notice of the hearing. Specifically, Shim takes the unusual position that his attorney's admitted receipt of the Notice of Hearing via electronic mail, rather than by United States mail, express carrier, facsimile or hand delivery, is insufficient due process under the Ethics Act and its regulations.3 We must disagree. The Commission takes seriously the due process rights, privileges and responsibilities afforded to all persons appearing before it. 65 Pa. C.S. § 1108(g). One of those rights is adequate notice and an opportunity to be heard. See, Commonwealth v. Turner, 80 A.3d 754 (Pa. 2013) (Procedural due process protections are satisfied when one receives adequate notice, an opportunity to be heard, and a chance to defend oneself before a fair and impartial tribunal). It is indisputable that Shim received timely notice of the hearing and had an opportunity to heard. To that end, Shim's counsel readily admitted that (1) he received the Notice of Hearing, (2) he had sufficient time to prepare for the hearing, and (3) he proposed the date of the hearing. N.T. pp. 113-114.4 Equally important is the obvious lack of prejudice to Respondent by receiving the Notice of Hearing via electronic mail rather than through the traditional United States Postal System or by facsimile. Once again, Respondent's attorney acknowledged that he had sufficient time to prepare for a hearing, the date of which he suggested. Given this lack of prejudice, Respondent's counsel did not even make an argument that his client was somehow prejudiced by the receipt of the Hearing Notice via electronic mail. Without any such prejudice alleged or established in the record, any argument to dismiss the Investigative Complaint/Findings Report must fail on this basis alone. While the Commission's then applicable regulations do not include electronic mail in the definition of "service" since they were promulgated in the late 1980s and early 1990s, these regulations also were never meant to allow an individual to avoid responsibility for violations of the Ethics Act based upon a hyper -technical argument that admitted receipt of the Notice of 9 Respondent's brief alleges that the Investigative Division failed to properly serve the Notice of Hearing; however, the Investigative Division's role is that of prosecutor in cases before the Commission. For clarification, it is the Commission that acts as adjudicator and therefore, the responsibility for noticing the hearing lies with the Commission and its Legal Division, not the Investigative Division. 4 All references to Notes of Testimony ("N.T.") are to the testimony taken on November 14, 2023 at the evidentiary hearing held in this matter. Shire, 22-0026-C Page 19 Hearing via electronic mail without any alleged prejudice is not sufficient to satisfy due process. While service via electronic mail may not have been in strict conformance with the Commission's then applicable regulations, the unavoidable facts remain that Shim's attorney proposed the date of the hearing, received notice of the hearing, had sufficient time to prepare for the hearing, and appeared at the hearing where he was given the opportunity to be heard. Accordingly, we deny the motion to dismiss. We shall now summarize the relevant facts. The Township is governed by a three -Member Board of Supervisors ("Board"). Shire has served as a Member of the Board since approximately November 2017. In addition to serving on the Board, Shire is the President/Vice President' of Shim's vehicle dealership ("Shim's"). Shire also is President of Lock -Cuff, Inc., a trucking business. Regarding Township's Purchase of a Vehicle from Shim's Dealership In 2018, the Township administration and the Board determined a need existed for a vehicle to be used by employees on Township business in lieu of using personal vehicles. Shirr participated in discussions regarding the need for a vehicle in his official capacity as a Member of the Board. In or around May 2018, then -Township Manager Robert Whitford ("Whitford") began working directly with Shire about the purchase of a Township vehicle. The Township did not put out a request for proposals or bids for a vehicle and did not utilize Municibid, a website used by municipal entities to buy and sell unwanted vehicles, equipment, and materials; instead, the Township's search for an appropriate vehicle consisted of Whitford walking through the lot of one local vehicle dealership and not finding any suitable vehicles within the Township's price range. Whitford made no additional efforts to locate a vehicle at any other local vehicle dealerships. In or around May or early .dune 2018, Shire informed Whitford that he had a vehicle on Shim's lot that would suit the Township's needs and budgetary constraints. On June 2, 2018, Shim's provided a quote to the Township in the amount of $4,600.00 for a 2003 Pontiac Vibe with 135,544 miles. Shim's had acquired the vehicle at auction on or about April 6, 2017 for the sum of $3,210.20. After the dealership acquired the vehicle, Shim's performed repairs on the vehicle on four occasions for a total of approximately $1,500.00. Shim's was unable to sell the vehicle and it remained in the dealership's used vehicle inventory for fourteen months until being sold to the Township. On June 6, 2018, Shim's submitted an invoice to the Township in the amount of $4,600.00 for the 2003 Pontiac Vibe. Notably, Whitford did not initiate an offer on the vehicle and made no attempt to negotiate the price. Whitford signed the invoice for the vehicle, as well as a copy of a Buyer's Guide provided by Shim's. At this time, the Board had not openly discussed or approved the purchase of the vehicle from Shim's. 5 The Commission cannot determine with certainty whether Respondent is the President or Vice President of Shim's. The Articles of Incorporation identify Shim as the Vice President, while his father and sister were listed as the other officers; however, Shirrs identified himself as the President of Shim's on several Statements of Financial Interests, See, Footnote 2. Shire, 22-0026-C Page 20 Whitford informed Supervisor Linda Mazzullo ("Mazzullo") that Shire had a vehicle the Township could purchase. Mazzullo immediately advised Whitford and Shire that this was a conflict of interest because Shim's vehicle dealership is a business with which Shire is associated. Shire ignored the concerns of Mazzullo regarding a conflict of interest and the sale of the vehicle to the Township proceeded. The Board voted to approve the purchase of a vehicle at its meeting on July 10, 2018. Of note are the meeting minutes which document that the Board simply voted to begin its search for a vehicle but did not vote to approve the purchase of any specific vehicle, including the 2003 Pontiac Vibe from Shim's, despite the fact that Whitford already had signed an invoice and Buyer's Guide for the vehicle more than a month earlier. Supervisor Sam Aungst ("Aungst") made the motion to begin searching for a Township vehicle, and Shinn seconded the motion. Mazzullo voted in favor of the motion and advised Whitford to provide some bids on vehicles for the Board's consideration. Mazzullo was never provided with any bids or proposals as requested. She was never provided a copy of the .Tune 6, 2018 invoice from Shim's for the purchase of a 2003 Pontiac Vibe and was unaware that the Township paid for the vehicle. Despite the limited nature of the motion to begin a search for a vehicle, Shire and Aungst signed the purchase order to purchase the 2003 Pontiac Vibe from Shim's following the July 2018 Board meeting. Mazzullo refused to sign the purchase order. Subsequently, Shirrs, Aungst, and Treasurer Debra Shilling ("Shilling") signed a check payable to Shim's in the amount of $4,600.00. The check was dated August 1, 2018. Shire personally delivered the vehicle to the Township. After delivery of the vehicle to the Township, Shim's performed several mechanical repairs on the vehicle at no cost to the Township despite the vehicle being sold "as is" with no warranty. The August 1, 2018 check to Shim's should have been included under accounts payable on the September 11, 2018 meeting agenda; however, neither Aungst nor Mazzullo recalled it being listed. The meeting minutes reflect that Aungst motioned to approve the accounts payable for August 2018, while Shire seconded the motion. The motion passed. Subsequently, the Township sold the vehicle on Municibid for $3,001.00 in or around the end of 2020 or the beginning of 2021. Regarding Shirn'_s_SM: Shire failed to file SFIs for calendar years 2017 through 2019. Shire filed an SFI on January 31, 2021, but incorrectly listed the year in Block 07 as 2021. Similarly, Shire filed an SFI on April 25, 2022, but incorrectly listed the year in Block 07 as 2022. Shinn filed an SFI intended for calendar year 2020 but failed to list in Block 13 that he had an office, directorship, or employment in Lock -Cuff, Inc., a trucking company in which he holds 100% financial interest. Shim's SFI intended for calendar year 2020 also did not include Lock - Cuff, Inc., Old Lycoming County, and Shim's vehicle dealership as direct or indirect sources of income in Block 10. In addition, this SFI failed to identify Shim's financial interest in Shim's Shirn, 22-0026-C Page 21 vehicle dealership in Block 14 even though he identified himself as the President of the company in that same SFI. The SFI filed by Shim for the intended calendar year of 2021 contained a similar deficiency inasmuch as Shim failed to list Old Lycoming County as a direct or indirect source of income in Block 10. Having set forth the material facts, we shall now outline the parties' respective positions/arguments with the exception of the motion to dismiss that was addressed above. The Investigative Division asserts: • That Shim used the authority of his public office by participating in discussions and actions of the Township to enter into a contract with Shira's, a vehicle dealership with which he and/or members of his immediate family are associated, resulting in a private pecuniary benefit to himself, members of his immediate family and/or Shirn's; • That Shim, through Shim's vehicle dealership, entered into a contract valued at more than $500.00 with the Township without an open and public process, citing the meeting minutes which fail to mention Shim's vehicle dealership or a possible sales transaction to purchase a vehicle from the dealership; • That the sale of the vehicle does not fall under the de minimis exception of the conflict of interest provision of the Ethics Act because the actual gain should not be measured by acquisition and/or repair costs; • That pursuant to Section 1107(13) of the Ethics Act, this Commission should order Shim to pay restitution in an amount of $4,600.00, representing the amount Shim's received from the Township for payment of the vehicle; • That in addition to imposing restitution, this Commission should impose a treble penalty pursuant to Section 1109(c) of the Ethics Act, 65 Pa.C.S. § 1109(c); and • That this Commission should also refer this matter to the Pennsylvania Attorney General with our recommendation that a criminal prosecution be initiated against Shim (see, Section 1107(13) of the Ethics Act, 65 Pa.C.S. § 1107(13)). Shirn has raised the following defenses/arguments: • That the Investigative Division failed to prove by clear and convincing evidence that Shirr violated the conflict of interest provision of the Ethics Act; • That the Investigative Division failed to demonstrate a private pecuniary gain to Shim inasmuch as they failed to prove that the check issued to Shim's for $4,600.00 was ever received and cashed; • That the sale of the vehicle falls under the de minimis exception of the conflict of interest provision of the Ethics Act in that the transaction resulted in an insignificant economic Shirn, 22-0026-C Page 22 impact on Shim as measured by the netprofit of the transaction. (See, Bixler v. State Ethics Commission, 847 A.2d 785 (Pa. Cmwlth 2004)); • That Shim did not violate Section I I03(a) of the Ethics Act because Shim was not aware of any private pecuniary gain to himself or the vehicle dealership. (see, Kistler v. State Ethics Commission, 22 A.3d 223 (Pa. 2011)); • That Shim did not violate the open and public process rule because the Board discussed the purchase of a vehicle for no more than $5,000.00 at the July 10, 2019 meeting; • That Shim submitted all Statements of Financial Interests as required and should have been given the opportunity to correct any mistakes on the submitted SFIs; and That this matter should be dismissed with prejudice. Having summarized the relevant facts and the positions/arguments of the parties, we must first determine whether Shim's actions violated Section 1103(a) of the Ethics Act. As we apply the facts to the allegation, due process requires that we not depart from the allegation. Pennsy v. Department of State, 594 A.2d 845 (Pa. Cmwlth. 1991). A violation of the Ethics Act must be based upon clear and convincing proof. Section I I08(g) of the Ethics Act, 65 Pa.C.S. § t 108(g). Clear and convincing proof 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 (1998) (Citation omitted). Per the Pennsylvania Supreme Court's decision in Kistler v. State Ethics Commission, 610 Pa. 516, 22 A.3d 223 (2011), in order to violate Section 1103(a) of the Ethics Act, a public official/public employee: ... must act in such a way as to put his [office/public position] to the purpose of obtaining for himself a private pecuniary benefit. Such directed action implies awareness on the part of the [public official/public employee] of the potential pecuniary benefit as well as the motivation to obtain that benefit for himself. Kistler, supra, 610 Pa. at 523, 22 A.3d at 227. To violate Section 1103(a) of the Ethics Act, a public official/public employee "must be consciously aware of a private pecuniary benefit for himself, his family, or his business, and then must take action in the form of one or more specific steps to attain that benefit." Id., 610 Pa, at 528, 22 A.3d at 231. In considering the allegation of a conflict of interest under Section 1103 (a), we determine that Shim used the authority of his office as a Township Supervisor to negotiate the sale of a vehicle from his vehicle dealership to the Township. The only question is whether the "de minimis exclusion" would be applicable because this case involved a net loss rather than a gain to his vehicle dealership. Shim, 22-0026-C Page 23 The de minimis exclusion precludes a finding of a conflict of interest as to an action having a de minimis (insignificant) economic impact. Thus, when a matter that would otherwise constitute a conflict of interest under the Ethics Act would have an insignificant economic impact, a conflict would not exist and Section 1103(a) of the Ethics Act would not be violated. The Investigative Division argues that the private financial benefit to Shire and his business was $4,600.00, the amount Shim's received from the sale of the vehicle to the Township. Shire maintains that it is the net profit to the dealership that should be utilized in considering the de minimis exclusion in Section 1103(a). Shirr argues that the Commonwealth Court decisions in Sero ian v. State Ethics Commission, 20 A.3d 534, 543 (Pa. Cmwlth. 2011) and Bixler v. State Ethics Commission, 847 A.2d 785, 786-788 (Pa. Cmwlth. 2004) support his view that the Commission should determine that the de minimis exception should apply whenever the transaction at issue results in a net loss. But the Commonwealth Court instructed the Commission that it did "not set a bright -line determination as to what constitutes a de minimis amount for the purposes of this exclusion in every case.... These matters are highly fact specific and must be considered on a case by case basis." Seropian , 20 A.3d 545 n. 10. Both Seropian and Bixler are distinguishable from this case. In Seropian, the issue was whether the de minimis exception should apply to the "incidental" personal use of a work computer. In Bixler, the issue was whether the de minimis exception should apply when the public official was not a principal of the truck repair business with which he was associated as a mechanic, received "no financial benefit," "did not perform work on the [Township's] vehicles," and "was motivated to help the township rather than to obtain personal financial gain," and the business made a net profit of $561.77 over 18 months "for all of its work on the Township's vehicles." In this case, Shire caused the Township to purchase a vehicle from his dealership for $4,600.00. While the dealership did not make a profit on the sale, the vehicle had been on the dealership's lot for 14 months without being purchased. This is a case of avoiding greater losses similar to many insider trading cases where the insider illegally sells stock to avoid or mitigate additional losses. See, p.g., SEC v. Williky, 942 F.3d 389 (7t" Cir. 2019). While restitution would not be appropriate where a public official or employee does not obtain a financial gain, we conclude that it is a conflict of interest in violation of Section 1103(a) when a public official avoids more than de minimis losses as is the circumstances in this case. Accordingly, because there is clear and convincing evidence that Shirrs avoided more than de minimis losses for his dealership when he caused the Township to purchase the vehicle for $4,600.00 and therefore received a private pecuniary benefit, we find that Shinn violated the conflict of interest provision of Section 1103(a). The Investigative Division next asserts that Shire violated Section 1103(t) when he, through a vehicle dealership in which he serves as an officer, entered into a contract valued at more than $500.00 with Old Lycoming Township without an open and public process. Based upon a review of the record, we conclude that there is clear and convincing evidence to prove that a violation of Section 1103(f) occurred, in that the process by which Shire and the Township entered into a contract to purchase the vehicle was not an open and public process. Shinn, 22-0026-C Page 24 It is undisputed that Shinn is either the President or Vice President of Shine's vehicle dealership. Shinn identifies himself as such on multiple Statements of Financial Interests ("SFIs"). (Exhibits ID — 8, ID — 10, and ID — 12). Although Shinn attempts to disassociate himself from the dealership by filing amended SFIs which no longer list him as President of Shim's vehicle dealership, we find that the original SFIs filed at the time are more credible evidence of his actual role than Shim's subsequent attempts to limit his involvement with the dealership. It is equally undeniable that the contract between Shim's and the Township was valued at more than $500.00. The evidentiazy record, including the quote, invoice, purchase order and the check issued to Shim's, unequivocally prove that the value of the contract was $4,600.00. The only remaining issue is whether the parties entered into this contract through an open and public process. It is well established that an open and public process as set forth in Section 1103(f) of the Ethics Act does not mandate a competitive bidding process. Kistler, supra, 610 Pa. at 535, 22 A.3d at 235. However, Section 1103(f) of the Ethics Act mandates that an open and public process at a minimum include prior public notice and subsequent public disclosure of all proposals considered and contracts awarded, none of which occurred here. In this case, there was no notice to the public prior to Shinn and the Township Manager entering into an agreement to purchase the vehicle in early June 2018. At that time, neither of the other two township supervisors were even aware of this agreement which is memorialized in the invoice signed by the Township Manager on June 6, 2018. At the Board's meeting on July 10, 2018, the Members, including Shire, voted to begin looking for a Township vehicle under $5,000.00. This is the first notice to the public that the Township was interested in purchasing a vehicle. Nowhere in the minutes is it mentioned that Shim and the Township Manager already had an agreement in place to purchase the vehicle from Shim's dealership. Similarly, the record is devoid of any evidence to demonstrate that the Township publicly disclosed the purchase of the vehicle. Once the purchase order was sent to the Treasurer, a check dated August 1, 2018 was issued to Shim's by the Township. Although this purchase should have been disclosed to the public at the Township's September 11, 2018 meeting, there is no mention of any vehicle purchase in the meeting minutes, let alone the fact that the purchase was from a vehicle dealership associated with one of the Township Supervisors. Based upon our review of the facts and the law, we conclude that Shim violated Section 1103(f) when he, through his vehicle dealership, entered into a contract valued at more than $500.00 with Old Lycoming Township without an open and public process. As to the remaining allegations concerning Shim's SFIs, it is noted that Shim admitted in his Answer to all of the violations regarding the reporting deficiencies alleged by the Investigative Division. (Fact Finding No. 14). The only allegations relating to SFIs that Shim did not admit are those pertaining to delinquent filings for calendar years 2017, 2018, and 2019. Shim offered no documentary or testimonial evidence to dispute the allegations, while the credible testimony of Investigator Bender firmly and unequivocally establishes the lack of SFI filings by Shim for these calendar years. Therefore, the Investigative Division has satisfied its burden of proving the SFI violations alleged in the Investigative Complaint/Findings Report and detailed below in the Shim, 22-0026-C Page 25 Conclusions of Law. Pursuant to Section 1109(f) of the Ethics Act, 65 Pa.C.S. § 1109(0, we shall impose five civil penalties against Shire in the amount of $250.00 each, for a total amount of $1,250.00, for the three years of delinquent filings in 2017, 2018, and 2019 and the two years of deficient filings in 2020 and 2021. There was no evidence offered by Shinn to mitigate the failure to file SFIs or the fact that the SFIs that were filed were replete with inaccurate information. Shire shall be ordered to make payment of the aforesaid civil penalties in the total amount of $1,250.00 by no later than the thirtieth (30") day after the mailing date of this adjudication and Order, by forwarding to this Commission a certified check or money order in the amount of $1,250.00 made payable to the Commonwealth of Pennsylvania, for deposit in the State Treasury. In the exercise of our discretion, we will not order disgorgement of the Township Supervisor compensation Shirrs received for years in which he did not have complete and accurate SFIs on file with the Township. We further order that Shirrs file complete and accurate SFIs for calendar years 2017 through 2021 with the Township by no later than the thirtieth (30"') day after the mailing date of this adjudication and Order, with copies forwarded to the Commission for compliance verification purposes. Shire is directed to not accept any reimbursement, compensation, or other payment from the Township representing a full or partial reimbursement of the aforesaid civil penalties. Non-compliance will result in the institution of an order enforcement action. Turning to the matter of referral, although Shim's conduct in this matter was a violation of the public trust, we do not find his conduct to be so egregious as to warrant referral of this matter to the Pennsylvania Attorney General for review. IV. CONCLUSIONS OF LAW: 1. As a Member of the Board of Supervisors of Old Lycoming Township ("Township") since November 2017, Respondent David W. Shire ("Shire") is a public official subject to the provisions of the Public Official and Employee Ethics Act ("Ethics Act"), 65 Pa.C.S. § 1101 et ie . 2. Shim violated Section 1103(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when he used the authority of his public position for the private pecuniary benefit of himself, members of his immediate family and/or Shim's vehicle dealership by participating in discussions and actions of the Township to enter into a contract with Shim's, a vehicle dealership with which he and/or members of his immediate family are associated. Shim violated Section 1103(f) of the Ethics Act, 65 Pa.C.S. § 1103(f), when Shim, through Shim's vehicle dealership, entered into a contract valued at more than $500.00 with the Township without an open and public process. Shim, 22-0026-C Page 26 4. Shim violated Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), when he failed to file required Statements of Financial Interests for the 2017, 2018, and 2019 calendar years. 5. Shim committed violations of Sections 1105(b)(8) and 1105(b)(9) of the Ethics Act, 65 Pa.C.S. § 1105(b)(8) and 1105(b)(9), when he failed to disclose his office, directorship, or employment in Lock -Cuff, Inc., and when he failed to list his financial interest in Shim's vehicle dealership on the Statement of Financial Interests intended for the calendar year 2020. 6. Shim committed violations of Sections 1104(a), 1105(b), and 1105(b)(5) of the Ethics Act, 65 Pa.C.S. § 1104(a), 1105(b), and 1105(b)(5), when he filed deficient Statements of Financial Interests for calendar years 2020 and 2021 by reporting the incorrect calendar year on the forms and by failing to list Lock -Cuff, Inc., Old Lycoming County, and Shim's vehicle dealership as sources of direct and indirect income on the Statement of Financial Interests filed for the intended calendar year 2020 and Old Lycoming County for the intended calendar year 2 02 1. 7. Notice of the delinquency and/or deficiency of Shim's Statements of Financial Interests for calendar years 2017 through 2021 was previously served upon him in accordance with Section 1107(5) of the Ethics Act, 65 Pa.C.S. § 1107(5). Based upon the totality of the circumstances in this case, including a lack of any mitigating evidence, five civil penalties in the total amount of $1,250.00 are warranted, $250.00 for each of the five years he had a delinquent or deficient Statement of Financial Interests in accordance with Section 1 109(f) of the Ethics Act, 65 Pa.C.S. § 1109(f). In Re: David W. Shim, : File Docket: 22-0026-C Respondent : Date Decided: 4/9/24 Date Mailed: 4/19/24 ORDER NO. 1835 David W. Shim, as a Member of the Board of Supervisors of Old Lycoming Township ("Township"), violated Section I I03(a) of the Ethics Act, 65 Pa.C.S. § 1103(a), when he used the authority of his public position for the private pecuniary benefit of himself, members of his immediate family and/or Shim's vehicle dealership by participating in discussions and actions of the Township to enter into a contract with Shim's, a vehicle dealership with which he and/or members of his immediate family are associated. 2. Shim violated Section 1103(f) of the Ethics Act, 65 Pa.C.S. § 1103(0, when Shim, through Shim's vehicle dealership, entered into a contract valued at more than $500.00 with the Township without an open and public process. 3. Shim violated Section 1104(a) of the Ethics Act, 65 Pa.C.S. § 1104(a), when he failed to file required Statements of Financial Interests for the 2017, 2018, and 2019 calendar years. 4. Shim committed violations of Sections 1105(b)(8) and 1105(b)(9) of the Ethics Act, 65 Pa.C.S. § 1105(b)(8) and 1105(b)(9), when he failed to disclose his office, directorship, or employment in Lock -Cuff, Inc., and when he failed to list his financial interest in Shim's vehicle dealership on the Statement of Financial Interests intended for the calendar year 2020. 5. Shim committed violations of Sections 1104(a), 1105(b), and 1105(b)(5) of the Ethics Act, 65 Pa.C.S. § 1104(a), 1105(b), and 1105(b)(5), when he filed deficient Statements of Financial Interests for calendar years 2020 and 2021 by reporting the incorrect calendar year on the forms and by failing to list Lock -Cuff, Inc., Old Lycoming County, and Shim's vehicle dealership as sources of direct and indirect income on the Statement of Financial Interests filed for the intended calendar year 2020 and Old Lycoming County for the intended calendar year 2021. 6. We hereby levy five civil penalties against Shim in the total amount of $1,250.00, $250.00 for each of the five years he had a delinquent or deficient Statement of Financial Interests from 2017 through 2021. 7. Shim is ordered to make payment of the aforesaid civil penalties in the total amount of $1,250,00 by no later than the thirtieth (30'') day after the mailing date of this Order, by forwarding to this Commission a certified check or money order in the amount of $1,250.00 made payable to the Commonwealth of Pennsylvania, for deposit in the State Treasury. hiM, 22-0026-C Page 28 Shim is ordered to file complete and accurate SFIs for calendar years 2017 through 2021 with Old Lycoming Township by no later than the thirtieth (30"') day after the mailing date of this adjudication and Order, with copies forwarded to the Commission for compliance verification purposes, 9. Shim is directed to not accept any reimbursement, compensation, or other payment from the Township representing a full or partial reimbursement of the aforesaid civil penalties. 10. Non-compliance with Paragraph 6, 7, 8, or 9 of this Order will result in the initiation of an appropriate enforcement action. BY T .THV COMMISSION, i Michael A. Schwartz, Chair Vice Chair Rhonda Hill Wilson dissents. In re: Shim, 22-0026-C Date: April 9, 2024 DISSENTING OPINION I respectfully dissent from the Majority Opinion. Section I. 108(g) of the Ethics Act, 65 Pa.C.S. § 1108(g), and the Regulations of the State Ethics Commission ("Commission") at 51 Pa. Code § 21.28(l) require that a violation of the Ethics Act be based upon clear and convincing proof. Clear and convincing proof 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: Sylvester. 521 Pa. 300, 304, 555 A.2d 1202, 1204 (1989). The Majority Opinion has concluded that the Investigative Division has satisfied this burden. I respectfully disagree with this conclusion. It is undisputed that a conflict of interest under Section 1103(a) of the Ethics Act requires a showing that the public official or public employee used the authority of his office for the private pecuniary benefit of himself, a member of his immediate family or a business with which he is associated. 65 Pa.C.S. §§ 1102, 1003(a). The definition of conflict of interest specifically excludes those actions having a de minimis economic impact. 65 Pa.C.S. § 1102. The term "benefit" is not defined in the Act. The Majority Opinion, while acknowledging that Shim's vehicle dealership did not make a profit on the sale of the vehicle to the Township, has determined that a private pecuniary benefit instead may be show through mitigation of a loss akin to an insider trading case by inference. While I do not disagree that a private pecuniary benefit may be shown through mitigation of a loss so long as the loss is measurable and equates to a financial gain of more than a de minimis nature, the evidence of record fails to establish a quantifiable mitigation of a loss by Shim by clear, direct, weighty, and convincing evidence. To that end, the only indication of a mitigation of a loss is testimony that the vehicle sold to the Township had been on Shim's lot for 14 months. I do not believe that a proper mitigation of loss inference can be drawn based solely on the length of time a vehicle is in a dealership's inventory. Further, I do not agree that such an inference alone is sufficient to satisfy the burden of proof in this matter. It appears that Shim's actions were meant to obtain a private pecuniary benefit for himself in violation of the Ethics Act's conflict of interest provision. This is troubling; however, an appearance of impropriety is insufficient to satisfy the weighty burden of clear and convincing evidence, a standard to which we must strictly adhere. For the reasons cited above, I do not concur with the Majority Opinion that Shim used the authority of his public position for the private pecuniary benefit of himself, members of his immediate family and/or Shim's vehicle dealership by participating in discussions and actions of the Township to enter into a contract with Shim's, a vehicle dealership with which he and/or members of his immediate family are associated, due to insufficiency of evidence and failure to meet the required burden of proof. �.1 Rhonda Hill Wilson, Vice Chair