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HomeMy WebLinkAbout1413 KehoeIn Re: Dan Kehoe, Respondent File Docket: X -ref: Date Decided: Date Mailed: Before: Louis W. Fryman, Chair John J. Bolger, Vice Chair Donald M. McCurdy Paul M. Henry Raquel K. Bergen Nicholas A. Colafella 05 -054 Order No. 1413 10/4/2006 10/20/2006 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 allegations. 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 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 Effective December 15, 1998, Act 9 of 1989 was repealed and replaced by Chapter 11 of Act 93 of 1998, 65 Pa.C.S. § 1101 et seq., which essentially repeats Act 9 of 1989 and provides for the completion of pending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. Kehoe, 05 -054 Page 2 I. ALLEGATION: That Dan Kehoe, a public official /public employee, in his capacity as Supervisor of Roaring Creek Township, Columbia County, violated provisions of the State Ethics Act (Act 93 of 1998) 65 Pa.C.S. § §1103(a); 1103(f); 1104(a) and 1105(b)(5)(8); when he and /or a business with which he is associated, Dan Kehoe Hauling (DKH), entered into a contract with the Township of Roaring Creek in excess of $500.00, for the hauling of stone and other products, without an open and public process, including public bids and public advertising; when he participated in actions of the board of supervisors to approve payments issued to himself and /or a business with which he was associated (DKH); when he failed to file a Statement of Financial Interests form for the 2003 calendar year on or before May 1, 2004; and when he failed to disclose on his Statement of Financial Interests form for calendar year 2004, all direct /indirect sources of income in excess of $1,300.00, and his office /directorship and /or employment with Dan Kehoe Hauling (DKH). II. FINDINGS: 1. Dan Kehoe has been serving as an appointed Supervisor and Roadmaster for Roaring Creek Township, Columbia County, since February 10, 2004. a. Kehoe has been employed as a township road worker since January 7, 2002 and continues to serve in that position. 2. As township Roadmaster, Dan Kehoe has the following duties and responsibilities: a. Oversee and direct the activities of the township's road workers. b. Inspect township roads /bridges and determine those that need repaired. c. Repair and /or replace piping alongside township roads. d. Organize equipment rentals by contacting distributors. e. Sign for the acceptance of the rental equipment. f. Deliver invoices generated while performing road related activities with the assistance of local businesses, vendors, and suppliers to the township secretary /treasurer to pay. g. Carry out directives ordered by the board of elected supervisors. 3. Roaring Creek Township is a 2 class township that is governed by a 3 member board. a. The supervisors acting as appointed road workers will assist with road related work organized by the roadmaster. 1. Historically, elected supervisors are also appointed road workers. b. Road work is usually performed on Saturdays unless there is a situation that needs immediate attention. 4. Dan Kehoe is the owner /operator of Dan Kehoe Hauling (DKH) located at 44 Mensch Road, Catawissa, PA 17820. a. DKH is a family run business operated by Kehoe and his wife Sherry Kehoe. Kehoe, 05 -054 Page 3 b. DKH has been operating from Kehoe's residence which is located within the township's geographical boundaries for approximately 6'/ years. c. DKH is a trucking company that hauls sand, topsoil, stone, coal, cinders, and anti -skid. d. DKH uses only one truck in the business operation, a blue 1990 MAC dump truck. e. Kehoe as owner /operator handles the business records, marks invoices as paid, and schedules the work for his company. 5. DKH is not incorporated nor have they filed fictitious name registrations with the Commonwealth of Pennsylvania, Department of State, Corporation Bureau. 6. Dan Kehoe d /b /a DKH has had a business relationship with Roaring Creek Township since approximately 2002, predating Kehoe's tenure as Supervisor /Roadmaster. a. Roaring Creek Township Supervisors became familiar with Kehoe's business when he was appointed as road worker in 2002. 7 In or about early 2002, the supervisors began requesting the services of DKH to haul materials for the township. a. The supervisors did so due to their familiarity with Dan Kehoe through his position as a road laborer and the convenient location of Kehoe's business in relation to the quarries and the township's shed. 8. From 2002 through January of 2004, Kehoe's business was used to haul stone, cinders, and anti -skid for the township while simultaneously being employed as a road employee. a. Kehoe would be paid for hauling services only. 1. The township would pay for materials separately. b. During this timeframe, Dan Kehoe was never required to provide sealed bids for township hauling work that he was asked to perform. 1. The township is not known to have solicited bids other than Kehoe. c. Prior to 2002, the Supervisors did not use a hauling company to transport materials instead relying on the quarries to deliver. 9. Roaring Creek Township's policy on hauling detailed in the previous findings did not change once Kehoe was appointed supervisor and roadmaster effective February 10, 2004. a. The township continued to pay for material and hauling separately. b. The decision to obtain materials and hauling services was the responsibility of the township's roadmaster. 1. After February 10, 2004 Kehoe assumed the responsibility of ordering materials and arranging for delivery. Kehoe, 05 -054 Page 4 10. After Dan Kehoe became supervisor /roadmaster on February 10, 2004, the township continued to use the services of DKH for hauling of materials. a. The use of DKH by the township was not put out for bid. 1. No other contractors were considered. 11. During 2004 and 2005 Dan Kehoe, in his official capacity as supervisor /roadmaster, participated in selecting his business to be used for hauling services and subsequently approved payments to be made to his business. a. Kehoe, in his official capacity as roadmaster, would determine work and materials needed and if the project required hauling, would select his business (DKH) to haul the material. b. Dan Kehoe would authorize DKH without soliciting other bids. 1. Kehoe did not obtain quotes from other comparable companies. c. Members of the board of supervisors were generally not consulted by Kehoe prior to projects being initiated. 12. Roaring Creek Township Board of Supervisors meeting minutes confirm that the supervisors did not discuss which hauling company would be utilized or that DHK [sic] was selected to perform hauling services for the township. a. Minutes also do not include any official action soliciting bids for hauling services during 2004 or 2005. 13. After DKH provided hauling services for the township, Kehoe would submit an invoice for payment. a. Kehoe personally would create and deliver the DKH invoices to the township's secretary /treasurer for payment. 14. Roaring Creek Township utilized different processes for the approval and payment of bills during 2004 and 2005. a. In 2004, monthly bill lists were not generated by then secretary /treasurer Emily DeWald. 1. DeWald would provide the bills from the prior month for the supervisors to review at a supervisors meeting. 2. An official vote would then be taken to approve /disapprove the payment of the bills after the supervisors reviewed them. 3. Emily DeWald would then write out checks to pay the approved bills. b. Since 2005, a monthly bill list is generated by the secretary /treasurer, Melissa Weber, for the supervisors to approve or disapprove at a township meeting. 1. It has been the practice that once a bill is received, Weber will pay the bill before an official approval vote is taken at a supervisor meeting. Kehoe, 05 -054 Page 5 c. Historically, township checks are signed by one supervisor (usually the chairman) and the secretary /treasurer. 15. Invoices submitted by Kehoe to the township for payment would include a separate invoice from the quarry where the material hauled was obtained. a. When Dan Kehoe picks up the material he signs a quarry invoice to signify the acceptance of the material. b. The secretary /treasurer will then make two separate payments, one to the quarry, the other to DKH. 16. Roaring Creek Township has business accounts at Bear Gap Stone, Inc. (RD #1 Box 138, Elysburg, PA 17824) and Hanson Aggregates Pennsylvania, Inc., Milton Plant, 3 Quarry Road, Milton, PA 17847. a. Both of these quarries provide different types of stone and subbase that the township uses to repair township roads. 17. From 2004 through 2005, Dan Kehoe invoiced the township twenty -two times for hauling materials. Total hauling fees exceeded $500.00 during both 2004 and 2005. Roaring Creek Township did not solicit hauling bids either year. No single hauling event exceeded $500.00. Several hauling events were included on a single invoice which exceeded $500.00. 1. This occurred once in 2004 and twice during the 2005 year. 18. The following chart details DKH invoices to the township and township checks issued to DKH for hauling services provided between April 2004 until September 2005. a. b. c. d. Invoice Date Transport Service 6/2/04 2RC Stone from Hanson Milton Quarry (23.29 ton) to Black Bear Dr. 6/2/04 #4 Stone from Bear Gap Quarry (23.85 ton) to Black Bear Dr. 6/4/04 Subbase from Bear Gap Quarry (48.05 ton) to Deer Mt. Rd. Invoice Amount Paid By Check Township Date Check # Signed By 4/5/04 1B Stone from Bear Gap Quarry $25.71 1791 4/20/2004 Randy (6.05 ton) to Twp. Building Madara and Emily DeVAald 5/4/04 2A Subbase from Bear Gap Quarry $99.02 1802 5/4/2004 Randy (23.30 ton) to Twp. Building Madara and Emily DeVAald 5/20/04 #4 Stone from Bear Gap Quarry $99.55 1821 6/8/2004 Randy (23.10 ton) to Twp. Building Madara and Emil', DeVAald $151.39 $101.36 $216.23 Included Included Included Meeting Date Kehoe's Official Action Bill List Date For Amount Paid by Township Check # 06/14/05 Seconded /vote May 4 - June 14 Dan Kehoe Hauling $ 454.02 1264, 1270 07/12/05 Seconded /vote June 15 - July 12 Dan Kehoe Hauling $ 336.99 2079 08/09/05 Seconded /vote July 13 - August 9 Dan Kehoe Hauling $ 673.27 1279 09/06/05 Seconded /vote August 10 - September 6 Dan Kehoe Hauling $ 607.48 1287 TOTAL $2,071.76 Meeting Date Kehoe's Official Action For DKH work done during the month(s) of Amount Paid by Township Check # April 20, 2004 Seconds March 11, 2004 — April 20, 2004 $ 25.71 1791 May 4, 2004 Motion April 21, 2004 — May 4, 2004 $ 99.02 1802 June 8, 2004 Motion May 5, 2004 — June 8, 2004 $568.53 1821 Total: $693.26 Kehoe, 05 -054 Page 6 4/8/05 2a Subbase from Bear Gap Quarry $340.98 1264 (72.55 ton) to Twp. Building 5/23/05 2A Subbase from Bear Gap Quarry $113.04 1270 (24.05 ton) to Twp. Building 6/16, 17, 2A Subbase from Bear Gap Stone 28/05 Quarry (71.70 ton) to Black Bear Rd. 7/13/05 2A Subbase from Bear Gap Stone Quarry (24.25 ton) to Twp. Building 7/15/05 2RC Stone from Bear Gap Stone Quarry (23.85 ton) to Twp. Building 7/22/05 2A Subbase from Bear Gap Stone Quarry (24.25 ton) to Twp. Building 7/28, 29/05 2A Subbase from Bear Gap Stone Quarry (47.85 ton) to Black Bear Dr. 8/1/05 2A Subbase from Bear Gap Stone Quarry (23.05 ton) to Twp. Building 8/10/05 2A Stone from Bear Gap Stone Quarry (23.05 ton) to unknown location 8/15/05 2A Stone from Hanson Milton Quarry (23.23 ton) to unknown location 8/17, 30/05 2A Stone from Bear Gap Stone and 9/1/05 Quarry (71.5 ton) to unknown location 2004 Year 2005 Year $336.99 2079 $673.27 1279 Included Included Included Included $607.48 Included Included Included Included 1287 Included Included Included Included 5/5/2005 6/14/2005 7/12/2005 8/9/2005 Randy Madara and Melissa Weber Randy Madara and Melissa Weber Randy Madara and Melissa Weber Randy Madara and Melissa Weber 9/6/2005 Randy Madara and Melissa Weber 19. Roaring Creek Township meeting minutes from 2004 through 2005 identify official actions Dan Kehoe took as a supervisor to approve payments to his business during the following meetings: a. Dan Kehoe voted to approve all township payments issued to his company during 2004 and 2005 totaling $2,765.02. Kehoe, 05 -054 Page 7 20. Kehoe as supervisor did not sign the front side of township checks issued to his business. 21. The issue of Kehoe providing hauling services for Roaring Creek Township was raised by Secretary /Treasurer Melissa Weber on September 8, 2005. 22. Weber issued a memo dated September 8, 2005 to Dan Kehoe which provided as follows. Dan, Looks like I paid Dan Kehoe Hauling in the amount of $2071.76 -a lot more than the $500 limit allowed per code. Sorry I didn't catch it sooner, but there is nothing that can be done at this point other than pay the township back the balance of $1571.76. I'm very sorry for the inconvenience I'm sure this causes, but I'd like to rectify the matter by the end of the year. Let's get together to review the PA Second Class Twp Code so you better understand procedure with regard to this matter. Meanwhile, plan on making a check payable to Roaring Creek Township in the amount of $1571.76 to be submitted at the December 13, 2005 board meeting. Again, my apology for not catching this sooner. 23. Weber subsequently sought a legal opinion from the township solicitor, Thomas Leopold regarding the applicability and scope of the annual limitation on the amount of goods and services furnished to a township by a township official or employee. 24. Leopold responded in a letter dated October 17, 2005 which noted that Section 3102 (i) of the Second Class Township Code was applicable. Leopold's opinion noted that, Subsection (i) unmistakably says that any payment in excess of $500 in any year to a township official or employee for materials furnished or work performed must be pursuant to a contract "...awarded through the public bid process." I thought about whether or not the process of obtaining such quotations would satisfy the requirement. I had concluded that such is not the case since the legislature, in other parts of Section 3102, expressly distinguishes between bidding and price quotations. I can only conclude that if it was the intention of the legislature to allow the price quotation procedure to satisfy the pre - qualification requirement of Subsection (i), it would have stated so explicitly. Accordingly, it is my opinion that Subsection (i) expressly prohibits annual payments exceeding $500 for goods or services obtained from a township official or employee unless it was preceded by the public bidding process. 25. Kehoe issued personal check #4517 dated December 13, 2005 in the amount of $1,571.76 to the township to make a reimbursement payment as a result of Weber's September 8, 2005 memo. a. a. The check was singed [sic] by Dan Kehoe's wife, Sherry Kehoe. 26. Based on Leopold's opinion, the supervisors put the hauling work out for bid in 2006. a. Bids were solicited based on the supervisors' interpretation of the law. b. Letters were sent out to various entities believed to have an interest in bidding on township hauling. Kehoe, 05 -054 Page 8 27. Roaring Creek Township publicly advertised for bids for the hauling work in a local paper, the Press Enterprise, from December 19, 2005 to December 23, 2005. a. The legal notice required sealed bids must be received at the township building no later than 7 p.m. January 3, 2006. 28. At the board of supervisors meeting on January 3, 2006, the supervisors opened sealed bids for hauling services. a. Bids were received from HRI Milton Quarry and DKH. b. Dan Kehoe's bid stipulated the following charges: Hauling from Bear Gap Stone Inc. - $47.70 a ton Hauling from HRI Milton Quarry - $5.90 a ton Hauling cinders - $6.00 a ton c. HRI Milton Quarry submitted a bid to haul at a rate of $75.00 an hour with a demand of 24 hour notice. d. At this meeting, Kehoe seconded the motion to table the bids until the February meeting. 29. Minutes from the supervisors February 7, 2006 [sic] confirm that supervisor Ralph Shoup made a motion to accept the bids from Dan Kehoe Hauling a. Kehoe informed the board that he had a conflict as he was the owner of the business. b. Supervisor Randy Madara did not second the motion. c. Kehoe then seconded the motion which is reflected as being approved by all. 30. Since March 2006, DKH has invoiced the township for deliveries and was paid as follows: Invoice Date Purpose Invoice Twp Amount Check # Date Signatures 3/13/06 2A Subbase from Bear Gap Stone $221.61 1344 4/4/2006 Randy Shoup Quarry (47.15 ton) to S. Deer Mt. Rd. and Melissa and Twp. Building Weber 3/20/06 2A Subbase from Bear Gap Stone $109.28 Quarry (23.25 ton) to Twp. Building 3/22/06 2B Stone from Bear Gap Stone Quarry $109.75 (23.35 ton) to Twp. Building 3/23/06 2A Subbase from Bear Gap Stone $110.45 Quarry (23.50 ton) to S. Deer Mt. Rd. 3/28/06 2A Subbase from Bear Gap Stone $221.37 Quarry (47.10 ton) to Twp. Building 4/3/06 2A Subbase from Bear Gap Stone $110.22 1349 5/2/2006 Robert Shoup Quarry (23.45 ton) to Black Bear Dr. and Melissa Weber Kehoe, 05 -054 Page 9 4/6/06 2A Subbase from Bear Gap Stone $113.74 Quarry (24.20 ton) to Twp. Building 4/7/06 2B Stone from Bear Gap Stone Quarry $108.81 (23.15 ton) to Twp. Building 4/13/06 2RC Stone from Bear Gap Quarry $112.57 (23.95 ton) to twp bldg. 31. Payments to DKH in 2006 were approved by the board of supervisors on April 4, 2006 and May 2, 2006. a. Kehoe abstained from voting on checks issued to DKH. 32. Kehoe, operating as DKH, charges a set rate to entities that request his service. a. The only expenses Kehoe's business incurs is fuel and truck maintenance. 33. On May 16, 2006 Kehoe provided the State Ethics Commission his set dollar rates for hauling services covering calendar years 2002 through 2006. a. These rates would be used throughout the year to create a charge to an entity for hauling as such (dollar rate X tonnage hauled = charge). b. Within the letter Dan Kehoe outlines the following rates: These are my hauling rate [sic] of the year 2002 $6.50 per ton from Milton Quarry to Roaring Creek Township Building. These are my hauling rates as of the year 2003 $6.50 per ton from Milton Quarry to Roaring Creek Township Building These are my hauling rates as of the year 2004 $4.30 per ton from Bear Gap Stone to Roaring Creek Township Building These are my hauling rates as of the year 2005 $4.70 per ton from Bear Gap Stone to Roaring Creek Township Building These are my hauling rates as of the year 2006 $4.70 per ton from Bear Gap Stone to Roaring Creek Township Building c. Dan Kehoe applied these rates when billing the township. 34. A major expense Dan Kehoe would incur when operating his business was the purchase of diesel fuel. a. Dan Kehoe reported in his letter that a round trip from his business to Bear Gap Stone Quarry to the township's shed back to his business is 39 miles. Also, in Dan Kehoe's letter he indicated that transporting materials form [sic] HRI Milton Quarry is a 62 mile round trip. b. The truck Dan Kehoe uses averages approximately 3.5 miles per gallon. 35. According to the Energy Information Administration, (official energy statistics from the US Government) in 2004 the annual rate of diesel fuel was $1.81 per gallon and in 2005 the annual rate was $2.40 a gallon. 36. The following chart shows the number of township hauling jobs DKH did, from which quarry, how many miles DKH totaled, and how much it cost Dan Kehoe in diesel fuel for township hauling jobs done in 2004 and 2005: 2004 Year Quarry # of Total Miles times used Traveled Diesel Gallons Used Cost in Fuel Kehoe, 05 -054 Page 10 Bear Gap Stone 5 195 55.714285 $100.84 HRI Milton Stone 1 62 17.714285 $32.06 2005 Year Total: $132.90 # of Total Miles Quarry times used Traveled Diesel Gallons Used Cost in Fuel Bear Gap Stone 15 585 167.14285 $401.14 HRI Milton Stone 1 62 17.714285 $42.51 Total: $443.65 37. The following charts shows [sic] the financial gain /profit Dan Kehoe realized when he as supervisor /roadmaster utilized his business to haul for the township. 2004 Year a. Total invoiced to the township by DKH (refer to finding #28) [sic]: Amount spent on diesel fuel (refer to finding #39) [sic]: Total financial gain realized: 2005 Year b. Total invoiced to the township by DKH (refer to finding #28) [sic]: Amount spent on diesel fuel (refer to finding #39) [sic] Amount reimbursed to the township by Dan Kehoe (refer to #30) [sic]: Total financial gain realized: $ 693.26 $- 132.90 $ 560.36 $ 2,071.76 $ - 443.65 $- 1,571.76 $ 56.35 38. Dan Kehoe realized a total financial gain of $616.71 from 2004 through 2005 by selecting, approving, and participating in discussions to use his business solely for township hauling purposes. The following findings relate to Dan Kehoe's statement of financial interests forms that were on file at Roaring Creek Township. 39. As a Supervisor for Roaring Creek Township, Kehoe, is annually required to file a SFI by May 1 of each year containing information for the prior calendar year. 40. Dan Kehoe did not file an SFI for calendar year 2003 by May 1, 2004 while serving as a township supervisor. 41. On May 8, 2005, Dan Kehoe filed an SFI for the 2004 calendar year with the township containing the following information: Calendar year: 2004 Filed: March 8, 2005, on SEC Form 01/05 Position: Supervisor Direct /indirect sources of income: Roaring Creek Township Office, directorship or employment in any business: None Position: None All other financial interests: None Kehoe, 05 -054 Page 11 42. Kehoe's 2004 SFI failed to include the following required disclosures. a. Income received from Roaring Creek Township in excess of $1,300. 1. Dan Kehoe's 2004 W -2 details that he was compensated $4,903.00 as a supervisor /road worker. b. Income received from DKH in excess of $1,300. c. Kehoe's office, directorship, or employment in DKH. 43. Kehoe was compensated as a township supervisor in the amount of $1,875.00 in 2004. III. DISCUSSION: At all times relevant to this matter, the Respondent, Dan Kehoe (Kehoe), has been a public official subject to the provisions of the Public Official and Employee Ethics Law, Act 9 of 1989, Pamphlet Law 26, 65 P.S. § 401 et seq., as codified by the Public Official and Employee Ethics Act, Act 93 of 1998, Chapter 11, 65 Pa.C.S. § 1101 et seq., which Acts are referred to herein as the "Ethics Act." The allegations are that Kehoe, as a Roaring Creek Township Supervisor, Columbia County, violated § §1103(a), 1103(f), 1104(a) and 1105(b)(5)(8) of the Ethics Act when he or a business with which he is associated, Dan Kehoe Hauling (DKH), entered into a contract with the Township in excess of $500.00 for the hauling of materials without an open and public process; when he participated in actions of the board of supervisors to approve payments issued to himself or DKH; when he failed to file a Statement of Financial Interests (SFI) for the 2003 calendar year on or before May 1, 2004; and when he failed to disclose on his SFI for calendar year 2004, all direct /indirect sources of income in excess of $1,300.00, and his office /directorship or employment with DKH. Pursuant to Section 1103(a) of the Ethics Act, a public official /public employee is prohibited from engaging in conduct that constitutes a conflict of interest. The term "conflict of interest" is defined under Act 9 of 1989/Act 93 of 1998 as follows: 65 Pa.C.S. § 1102. Section 1102. Definitions "Conflict" or "conflict of interest." Use by a public official or public employee of the authority of his office or employment or any confidential information received through his holding public 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. "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. Kehoe, 05 -054 Page 12 Section 1103(a) of the Ethics Act prohibits a public official /public employee from using the authority of public office /employment or confidential information received by holding such a public position for the private pecuniary benefit of the public official /public employee himself, any member of his immediate family, or a business with which he or a member of his immediate family is associated. Section 1103(f) of the Ethics Act provides: Section 1103. Restricted activities (f) No public official or public employee or his spouse or child or any business in which the person or his spouse or child is associated shall enter into any contract valued at $500 or more with the governmental body with which the public official or public employee is associated or any subcontract valued at $500 or more with any person who has been awarded a contract with the governmental body with which the public official or public employee is associated, unless the contract has been awarded through an open and public process, including prior public notice and subsequent public disclosure of all proposals considered and contracts awarded. In such a case, the public official or public employee shall not have any supervisory or overall responsibility for the implementation or administration of the contract. Any contract or subcontract made in violation of this subsection shall be voidable by a court of competent jurisdiction if the suit is commenced within 90 days of the making of the contract or subcontract. 65 Pa. C. S. § 1103(f). Section 1103(f) of the Ethics Act provides in part that no public official /public employee or spouse or child or business with which he or the spouse or child is associated may enter into a contract with his governmental body valued at five hundred dollars or more or any subcontract valued at five hundred dollars or more with any person who has been awarded a contract with the governmental body with which the public official /public employee is associated unless the contract is awarded through an open and public process including prior public notice and subsequent public disclosure. Section 1104. Statement of financial interests required to be filed (a) Each public official of the Commonwealth shall file a statement of financial interests for the preceding calendar year with the commission no later than May 1 of each year that he holds such a position and of the year after he leaves such a position. Each public employee and public official of the Commonwealth shall file a statement of financial interests for the preceding calendar year with the department, agency, body or bureau in which he is employed or to which he is appointed or elected no later than May 1 of each year that he holds such a position and of the year after he leaves such a position. Any other public employee or public official shall file a statement of financial interests with the governing authority of the political subdivision by which he is employed or within which he is appointed or elected no later than May 1 of each Kehoe, 05 -054 Page 13 year that he holds such a position and of the year after he leaves such a position. Persons who are full -time or part -time solicitors for political subdivisions are required to file under this section. 65 Pa.C.S. §1104(a). Section 1104(a) of the Ethics Law quoted above requires that each public official /public employee must file a Statement of Financial Interests for the preceding calendar year, each year that he holds the position and the year after he leaves it. Section 1105. Statement of financial interests (b) Required information. - -The statement shall include the following information for the prior calendar year with regard to the person required to file the statement: (5) The name and address of any direct or indirect source of income totaling in the aggregate $1,300 or more. However, this provision shall not be construed to require the divulgence of confidential information protected by statute or existing professional codes of ethics or common law privileges. (8) Any office, directorship or employment of any nature whatsoever in any business entity. 65 Pa.C.S. §§ 1105(b)(5), (8). Section 1105(b)(5) 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 $1,300 or more. Section 1105(b)(8) of the Ethics Act requires that every public official /public employee and candidate list any office, directorship or employment of any nature whatsoever in any business entity. 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. Kehoe has served as a Roaring Creek Township Supervisor and Roadmaster since February 2004 and as a Township road worker since January 2002. Roaring Creek Township has a three member Board, all of whom act as appointed road workers. In a private capacity, Kehoe is the owner /operator of Dan Kehoe Hauling (DKH), a trucking business primarily engaged in hauling materials. DKH has had a business relationship with the Township since 2002 when Kehoe became employed as a road worker. From 2002 through January of 2004, the Township utilized Kehoe's business for hauling stone, cinders and anti -skid because the supervisors were familiar with Kehoe and the convenient location of his business relative to quarries and the Township's shed. The supervisors did not require Kehoe to submit sealed bids, and that process continued after Kehoe was appointed supervisor and road master. During 2004 and 2005, Kehoe, as a supervisor, participated in selecting his business to do hauling services for the Township and also participated in approving payments. Kehoe authorized DKH to provide services without soliciting bids or obtaining comparables from Kehoe, 05 -054 Page 14 other companies. Once DKH provided services, Kehoe submitted an invoice for payment to the Township secretary /treasurer. In 2004 and 2005, Kehoe invoiced the Township 22 times for hauling services. The details of such services as well as particulars for the payments are delineated in Fact Finding 18. The various actions that Kehoe took as a supervisor to approve payments to his business appear in the meeting minutes from 2004 through 2005 as summarized in Fact Finding 19. The issue of Kehoe providing hauling services to the Township was raised by the secretary /treasurer in September 2005 in a memo she sent to Kehoe. In that memo, the secretary /treasurer asserted that Kehoe provided services in excess of the $500 limit set forth in the Second Class Township Code (Code). The secretary /treasurer concluded that Kehoe needed to pay back $1,571.76 of the $2,071.76 paid to DKH. The secretary /treasurer sought a legal opinion from the Township Solicitor who determined that the Code prohibited annual payments exceeding $500 for goods and services. Thereafter, Kehoe issued a check to the Township in the amount of $1,571.76, consistent with the directive in the memo of the secretary /treasurer. The supervisors began soliciting bids for hauling work in December of 2005. The supervisors at a January 2006 meeting opened the sealed bids for hauling services. Bids were received from DKH and the HRI Milton Quarry. Action on the bids was tabled until the February meeting with Kehoe seconding the motion. A supervisor other than Kehoe made a motion at the February 2006 meeting to accept the bid from DKH. Kehoe informed the Board of his conflict and the third supervisor did not second the motion. Kehoe then seconded the motion, which is reflected as being approved by all supervisors. From March 2006, DKH has provided services and submitted invoices to the Township as detailed in Fact Finding 30. Payments were approved by the Board of Supervisors with Kehoe's abstention as to the checks issued to DKH. Based upon a computation involving the various hauling rates for the different years in issue as well as the cost of diesel fuel, it has been determined that Kehoe realized a total financial gain of $616.71 from 2004 through 2005 when his business provided hauling services to the Township. Turning to the SFI issues, the findings reflect that Kehoe did not file an SFI for the calendar year 2003 by May 1, 2004. For the calendar year 2004, Kehoe filed an SFI wherein he listed Roaring Creek Township as a source of income and checked "none" as to office, directorship or employment in any business entity. Parenthetically, Fact Finding 42 indicates that Kehoe failed to list income from the Township on his 2004 calendar year SFI. In light of that factual inconsistency with Fact Finding 41, which reflects that Kehoe listed the Township as a source of income, we will resolve that factual inconsistency by finding that Kehoe did in fact list the Township as a source of income. However, Kehoe failed to list DKH as a source of income in the calendar year 2004 even though he received income in excess of $1,300. Kehoe also failed to list DKH as an office, directorship or employment in a business entity. 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 as follows: "3. The Investigative Division will recommend the following in relation to the above allegations: a. That a violation of Section 1103(a) of the Public Official and Kehoe, 05 -054 Page 15 Employee Ethics Law, 65 Pa.C.S. §1103(a) occurred when Kehoe, as a public official /public employee, in his capacity as Supervisor of the Roaring Creek Township, Columbia County, entered into a contract between the township and a business with which he is associated, Dan Kehoe Hauling (DKH), in excess of $500.00, without an open and public process; and b. That a violation of Section 1103(f) of the Public Official and Employee Ethics Law, 65 Pa.C.S. §1103(f) occurred in relation to Kehoe entering into a contract for the hauling of stone and other product for the township of Roaring Creek, in excess of $500.00, without an open and public process; and c. That a violation of Section 1104(a) of the Public Official and Employee Ethics Law, 65 Pa.C.S. §1104(a) occurred in relation to Kehoe's failure to file a timely Statement of Financial Interests for calendar year 2003; and d. That a violation of Section 1105(b) of the Public Official and Employee Ethics Law, 65 Pa.C.S. §1105(b) occurred in Kehoe's failure to disclose on his Statement of Financial Interests form for the calendar year 2004, all direct /indirect sources of income in excess of $1,300.00, specifically his compensation as a supervisor /road worker for Roaring Creek Township and compensation derived from income received from DKH in excess of $1,300.00; and additionally Kehoe failed to identify his office, directorship or employment in regards to a business entity, specifically his interest in, Dan Kehoe Hauling (DKH). 4. Kehoe agrees to make payment in the amount of $500.00 in settlement of this matter payable to the Commonwealth of Pennsylvania, and forwarded to the Pennsylvania State Ethics Commission within thirty (30) days of the issuance of the final adjudication in this matter. 5. Kehoe agrees to filed Statements of Financial Interests for calendar year 2003 and agrees to file an amended Statement of Financial Interests form for calendar year 2004." Consent Agreement, ¶ ¶3 -5. In applying the provisions of Section 1103(a) of the Ethics Act to the stipulated findings, we find that there were uses of authority of office on the part of Kehoe. But for the fact that Kehoe was a supervisor and roadmaster, he would not have been in a position to select DKH, a business with which he is associated, to provide various hauling services to the Township. In addition, Kehoe participated in the process of approving the payments to DKH. Such actions were uses of authority of office. See, Juliante, Order 809. Such uses of authority of office resulted in private pecuniary benefits to DKH as to the profits that were obtained in providing the hauling services for the Township. Lastly, the private pecuniary benefits inured to DKH, the business with which he is associated, as that term is defined under the Ethics Act. Accordingly, Kehoe violated Section 1103(a) of the Ethics Act when he used his position to obtain a private pecuniary benefit for DKH, a business with which he is associated, in providing hauling services for the Township. See, Gallagher, Order 1059. Kehoe, 05 -054 Page 16 Turning to Section 1103(f) of the Ethics Act, this provision allows contracting between a public official /public employee, spouse, child or a business with which the public official /public employee, spouse or child is associated. However, if such contracting is $500 or more, it must be awarded through an open and public process as per the requirements of Section 1103(f) of the Ethics Act. In this case, during the time frame of 2004 and 2005, contracting occurred between the Township and DKH, a business with which Kehoe is associated. Although such contracting was in excess of $500, it was not awarded through an open and public process. Accordingly, Kehoe violated Section 1103(f) of the Ethics Act when he entered into contracts to provide hauling services for the Township which were in excess of $500 and not awarded through an open and public process. See, Brennan, Order 1047. As to Section 1104(a) of the Ethics Act, the record reflects that Kehoe failed to timely file an SFI for the calendar year 2003. Accordingly, Kehoe violated Section 1104(a) of the Ethics Act when he failed to timely file an SFI with the Township for the calendar year 2003. For the 2004 calendar year, Kehoe filed his SFI listing the Township as a source of income but failed to list DKH as a source of income and failed to list his office, directorship or employment in that business entity. Since Kehoe did list the Township as a source of income, we cannot find any violation of the Ethics Act as to that part of the allegation. However, we find that Kehoe violated Section 1105(b) of the Ethics Act in each instance when he failed to list DKH as a source of income and failed to list his office, directorship or employment with DKH for the calendar year 2004 SFI. See, Yarnall, Order 996. 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, Kehoe is directed to make payment in the amount of $500.00 in settlement of this matter payable to the Commonwealth of Pennsylvania, and forwarded to this Commission within thirty (30) days of the issuance of the final adjudication in this matter. If Kehoe has not already done so, he must file an SFI for the calendar year 2003, making a full and complete disclosure of reportable financial interests and file an amended SFI for the calendar year 2004 listing DKH as a source of income as well as his office, directorship or employment in DKH and any other reportable financial interests, with the originals filed at the Township and copies filed at this Commission for compliance verification. Compliance with the foregoing will result in the closing of this case with no further action by this Commission. Noncompliance will result in the institution of an order enforcement action. IV. CONCLUSIONS OF LAW: 1. Dan Kehoe, as Supervisor of Roaring Creek Township, Columbia County, is a public official subject to the provisions of Act 9 of 1989 as codified by Act 93 of 1998. 2. Kehoe violated Section 1103(a) of the Ethics Act when he used his position to obtain a private pecuniary benefit for DKH, a business with which he is associated, in providing hauling services for the Township. 3. Kehoe violated Section 1103(f) of the Ethics Act when he entered into contracts to provide hauling services for the Township which were in excess of $500 and not awarded through an open and public process. 4. Kehoe violated Section 1104(a) of the Ethics Act when he failed to timely file an SFI with the Township for the calendar year 2003. Kehoe, 05 -054 Page 17 5. Kehoe violated Section 1105(b) of the Ethics Act in each instance when he failed to list DKH as a source of income and failed to list his office, directorship or employment with DKH for the calendar year 2004 SFI. In Re: Dan Kehoe, Respondent ORDER NO. 1413 File Docket: 05 -054 Date Decided: 10/4/2006 Date Mailed: 10/20/2006 1 Dan Kehoe, as Supervisor of Roaring Creek Township, Columbia County, violated Section 1103(a) of the Ethics Act when he used his position to obtain a private pecuniary benefit for DKH, a business with which he is associated, in providing hauling services for the Township. 2. Kehoe violated Section 1103(f) of the Ethics Act when he entered into contracts to provide hauling services for the Township which were in excess of $500 and not awarded through an open and public process. 3. Kehoe violated Section 1104(a) of the Ethics Act when he failed to timely file a Statement of Financial Interests with the Township for the calendar year 2003. 4. Kehoe violated Section 1105(b) of the Ethics Act in each instance when he failed to list DKH as a source of income and failed to list his office, directorship or employment with DKH for the calendar year 2004 Statement of Financial Interests. 5. Per the Consent Agreement of the parties, Kehoe is directed to make payment in the amount of $500.00 to the Commonwealth of Pennsylvania, and forwarded to this Commission within thirty (30) days of the issuance of the final adjudication in this matter, and, if he has not already done so, file a Statement of Financial Interests for calendar year 2003 and an amended Statement of Financial Interests for calendar year 2004, with the originals filed at the Township and copies filed at this Commission for compliance verification. a. Compliance with the foregoing will result in the closing of this case with no further action by this Commission. b. Non - compliance will result in the institution of an order enforcement action. BY THE COMMISSION, Louis W. Fryman, Chair