Public Enforcement Letter 93-1

Chief Donald Eunson
c/o William J. Daily, Esq.
Sloane & Walsh
3 Center Plaza
Boston, MA 02108

February 26, 1993

Dear Chief Eunson:

As you know, the State Ethics Commission has conducted a
preliminary inquiry regarding an allegation that, as the Town of
Bedford Police Chief, you assisted your son in obtaining a
bargain purchase of a police vehicle you were trading in to
Natick Auto Sales, Inc. (Natick Ford). The results of our
investigation (discussed below) show that the conflict of
interest law may have been violated here. In view of certain
mitigating circumstances (also discussed below), the Commission,
however, does not feel that further proceedings are warranted.
Rather, the Commission has determined that the public interest
would be better served by bringing to your attention, and to the
attention of your colleagues throughout the Commonwealth, the
facts revealed by our investigation and by explaining the
application of the law to such facts, trusting that this advice
will ensure your future understanding of the law. By agreeing to
this public letter as a final resolution of this matter, the
Commission and you are agreeing that there will be no formal
action against you and that you have chosen not to exercise your
right to a hearing before the Commission.

I. The Facts

1. At all relevant times, you were the Town of Bedford
Police Chief [1]. As such you were a "municipal employee" as
defined in G.L. c. 268A, s. 1.

2. The Bedford Police Department (BPD) has a total of
seven vehicles: four marked cruisers and three unmarked cars.
Typically, the BPD's vehicles are only kept for two or three
years, such that each year the BPD trades in three or four
vehicles and purchases the same number of new vehicles.

3. As chief, you have the overall responsibility for these
purchases, but, in fact, you have little, if anything to do with
the details of the purchases. (As chief, you do sign all the
necessary paperwork.) The details of deciding whether three or
four cars will be traded in, what accessories will be transferred
from old to new vehicles, and what, if any, new accessories will
be purchased, are all left to Lt. Jack McGrath, who has worked
for the BPD for some 26 years.

4. For the last several years, the BPD has both purchased
its new vehicles from, and traded in its old vehicles to, Natick
Ford. For several years, Natick Ford has been the winning bidder
of the Greater Boston Police Council (GBPC) cooperative
purchasing contract. The various towns that are a party to that
contract can buy new vehicles, accessories and options at a set
price that is very competitive. The contract also provides for
set trade-in allowances, although those trade-in prices are
subject to the vehicle's condition and mileage [2].

5. Generally speaking, Lt. McGrath dealt with Clay Chase
of Natick Ford. At some point in the late spring of each year,
Lt. McGrath would tell Chase how many new vehicles the BPD wanted
to purchase. When those vehicles arrived at Natick Ford, Lt.
McGrath would decide which accessories would be transferred from
the old to the new vehicles and, what, if any, new accessories
would be obtained. Lt. McGrath would turn in one used vehicle to
Natick Ford at a time, transfer equipment if necessary to the new
vehicle, and bring the new vehicle back to the BPD. This process
would continue until all three or four new vehicles were
received. Frequently, you, as chief, would accompany Lt. McGrath
in turning in the used vehicles and picking up the new ones. On
some of those occasions you would see Chase and talk to him.
Those discussions were more social than business, however.

At the end of this process, Natick Ford would give Lt.
McGrath a final bill which would reflect the net price the BPD
owed Natick Ford after trade-in allowances were subtracted. Lt.
McGrath would not negotiate regarding those trade-in allowances.
According to Lt. McGrath, he took whatever Natick Ford allowed.
He was aware that trade-in allowances were set out in the GBPC
contract. However, he did not check to see what those prices
were. He was not aware that those prices were subject to
adjustment depending upon mileage and condition. Neither he nor

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you were aware that the town could obtain a higher price if a
trade-in was in particularly good condition.

6. In the late spring of 1991, the process as just
described was followed. Thus, Lt. McGrath placed an order for
three new vehicles from Natick Ford. As of approximately June 5,
1991, Lt. McGrath had turned in two used vehicles and picked up
two new vehicles.

7. Shortly before June 5, 1991, your son David, who was at
the time 29 years old and maintained his own separate residence,
informed you that he would like to purchase your former chief's
car which was being traded in [3].

At some point shortly before June 5, 1991, you talked with
Chase (in person) and asked him whether you could buy back one of
the BPD vehicles being traded in. He said that you could, but you
would have to make your purchase from Natick Ford's wholesale
division. Although your and Chase's memories are vague, your best
recollection is that no price was discussed at that time.

8. On June 5, 1991, you, your son David and Lt. McGrath
drove together in your police chief's car to Natick Ford. Lt.
McGrath turned in that vehicle. Although memories of details are
vague, according to David, he asked Chase how much it would cost
to buy back your former chief's car. Chase said $600. There was
no negotiating. David agreed to the price, wrote a check for that
amount and gave it to Chase [4].

At the same time David was completing his purchase, Lt.
McGrath was finalizing the details regarding the town's purchase
of the three new vehicles. Thus, Chase gave Lt. McGrath the final
bill for the three new vehicles [5]. Thereafter, David drove your
former chief's car home, and you and Lt. McGrath brought back the
remaining new vehicle to the BPD.

9. According to Chase, your former chief's car was in very
good shape. The combination of its condition, low mileage, and
absence of police markings would have given it a retail value of
$3,000 to $4,000, even as a former police car. According to
Chase, however, Natick Ford does not sell these vehicles to the
public. Rather, Natick Ford's practice is to quickly wholesale
them, primarily to a company that, in turn, sells them to be used
as cabs in New York City. That company looks for cars that have
police packages, in particular the heavy suspension and vinyl
seats which are prerequisites for them being used as cabs.
According to Chase, although your former chief's car would have
obtained an attractive price at retail, it was less desirable for
Natick Ford's wholesale customers, because it lacked the
requisite police package.

According to Chase, the only reason he was willing to sell
the car to David was because David was your son. While, generally
speaking, Natick Ford will not sell former police vehicles to the
public, it will sell them to its client's employees and family
members of those employees in order to maintain good customer
relations.

Finally, according to Chase, Natick Ford only looks to make
$200 to $400 in reselling these used police vehicles. When it
would resell to a town employee, generally Natick Ford looked to
make $200 over the trade-in allowance. Chase was not able to
explain why Natick Ford charged your son only $100 over the
trade-in allowance, although he noted that the $200 policy was an
informal one, and at times they sought only to obtain $100 over
the trade-in allowance. Chase provided us with information
regarding four former police vehicles Natick Ford had resold to
municipal employees in or about June 1991. That information
indicates that in three of those four instances Natick Ford
resold the vehicles for $200 over cost, and in the remaining
situation for $100 over its cost.

10. The other two BPD vehicles traded-in on or about June
5, 1991, were a 1988 LTD cruiser with 93,666 miles and the 1990
LTD already described. These cars were wholesaled by Natick Ford
as part of a lot of 23 vehicles for $34,000. (The price was for
the entire lot. There was no individual breakdown.) Of those 23
vehicles, only three were 1989 or 1990 model years. Indeed, 14 of
those vehicles were 1987 or older models. In any event, the
average wholesale re-sale price of those cars was $1,478.

11. Under oath, both you and Chase stated that you did not
attempt to place any pressure on Chase to give your son any
preferential treatment in this sale. Furthermore, according to
you and Chase, it has been a common practice for Town of Bedford
employees to buy back town vehicles that are traded in to Natick
Ford.

12. In the future, the town plans to sell its used vehicles
at a public auction.

II. Discussion

As the Town of Bedford Police Chief, you have been a
municipal employee for the purposes of the conflict of interest
law, G.L. c. 268A. In the

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Commission's view, the foregoing evidence supports a reasonable
cause finding that you violated G.L. c. 268A as follows.

Section 23(b)(2) of G.L. c. 268A prohibits a municipal
employee from, knowingly or with reason to know, using or
attempting to use his official position to secure for anyone an
item of substantial value not otherwise available to similarly
situated people. The Commission has made clear that anything
worth $50 or more is an item of substantial value. Commission
Advisory No. 8. Chase's testimony suggests that Natick Ford
generally looked to make a $200 mark-up on these police trade-
ins. Indeed, three out of the four "comparables" showed $200
mark-ups. Consequently, it would appear that your son received at
least a $100 discount by not having to pay that standard mark-up.

Even if, in fact, Natick Ford had a uniform practice of
selling its trade-ins to public employees for $100 over the
trade-in allowance, such sales would appear to involve
substantial value in that the general public cannot buy them for
those prices. The real value of the cars, as showed by Natick
Ford's wholesaling of the 23-car lot in June 1991, is
considerably more, on average, than would be reflected by either
a $100 or $200 mark-up. Indeed, as that lot sale shows, the
average per car profit is something more like $900 than $100 or
$200.

We also note that as to this particular police car, it was
described as being in very good condition. In fact, Chase's
opinion was that at retail, even as a used police vehicle, it was
worth $2,000 to $3,000. Therefore, for all the foregoing reasons,
your son does appear to have received "substantial value" in this
deal.

The next issue is whether you used or attempted to use your
official position to obtain this "substantial value" for your
son. There appears to have been no explicit connecting of your
official position to the private accommodation. Compare In re
Singleton, 1990 SEC 476 (fire chief violates s. 23(b)(2) by
telling a builder that certain fire department inspections could
take forever, while in the same conversation asking the builder
to maintain its business with his son) and In re Galewski, 1991
SEC 504, 505 (building inspector knew or should have known that
the effect of his conduct -- making requests during the course of
inspections that a builder sell him a house that he could afford
-- was to put pressure on the builder to make some sort of
unwarranted private accommodation to the inspector). Your
situation seems to fall short of the kind of overt pressure
exemplified by Singleton and Galewski [6]. Nevertheless, the
Commission has made clear that a public official may not solicit
a vendor of his agency for a private commercial relationship
without violating s. 23(b)(2). See, e.g., Advisory #1. This is
because such situations are deemed to be inherently exploitable.
Moreover, in your situation there was more than just the
solicitation per se (even if there was no explicit pressure).

Thus, you made the initial inquiry during a visit to Natick
Ford while official police business was being transacted. Later,
you brought your son to Natick Ford in a police cruiser, and you
were at least on the premises, if not actually accompanying your
son, when he bought the trade-in, all while Natick Ford was
completing its $45,000 transaction with the BPD. Moreover, it is
clear that but for David being your son, Natick Ford would not
have sold the car to David. Therefore, under all these
circumstances, it seems fairly compelling that you used your
position to obtain this accommodation.

Finally, there is no apparent justification for why your son
should have been able to purchase such a car when members of the
public could not. This is especially so where the purchase
appears to have been at a discount. Therefore, the purchase
appears to have involved an unwarranted privilege not available
to similarly situated individuals. See, EC-COI-86-14 [7].

In summary, where the sale involved substantial value, where
you used your position to effect the sale, and where the value
was an unwarranted privilege not available to similarly situated
people, there is reasonable cause to believe that you violated s.
23(b)(2).

Section 23(b)(3) prohibits a municipal employee from
knowingly, or with reason to know, causing a reasonable person
knowing all of the circumstances to conclude that anyone can
unduly enjoy his favor in the performance of his official duties.
Where you are responsible for your department's substantial
contract with Natick Ford (an average of $50,000 a year), you
should not get involved in seeking any kind of private commercial
relationship with that vendor, even if the evidence was fairly
convincing that no preferential treatment was provided. See,
e.g., In re Keverian, 1990 SEC 460 (Speaker of the House violated
s. 23(b)(3) by hiring his State House carpenter to do substantial
work on his own residence, although work was paid for at the
going rate); Commission Advisory #1. Here, the appearance of
impropriety is exacerbated by the following factors: (1) you
initiated the discussion, (2) you did so in the context of an
official business transaction, (3) you accompanied your son and
were at least on the premises (when the town's

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purchase was being completed) when your son made his purchase,
(4) there is considerable evidence to suggest that there was a
substantial discount, and (5) the general public could not have
purchased this car.

III. Disposition

Based on its review of this matter, the Commission has
determined that the sending of this letter should be sufficient
to ensure your understanding of, and your future compliance with,
the conflict of interest law. Although the Commission is
authorized to impose a fine of up to $2,000 for each violation of
G.L. c. 268A, the Commission chose to resolve this matter with a
public enforcement letter for the following reasons: (1) you do
not appear to have attempted to exert any pressure on Natick Ford
to provide your son with preferential treatment; and (2) the
practice of town employees purchasing used town vehicles when
they are traded in by the town appears to be a systemic one, and
the Commission has not previously made clear how the conflict of
interest law applies in these situations [8]. With those factors
in mind, the Commission has chosen to resolve your situation with
a public enforcement letter in order to communicate a clear
message that department heads cannot buy back their agency's
trade-ins from vendors with whom they have official dealings.

This matter is now closed.


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[1] Indeed, you have been chief for 33 years.

[2] For example, the 1991 contract provided that 1988 LTDs
were to receive a trade-in allowance of $500. By comparison, a
1990 LTD had a trade-in allowance of $2,300, although an
additional $1,000 could be allowed if the 1990 LTD had less than
60,000 miles.

[3] This was a 1988 LTD with 50,438 miles at the time it was
traded in. It had air conditioning and a radio. It was in good
running condition. It was an unmarked car. It did not have the so
called "police package" which includes a heavy duty suspension
and vinyl seats. (Rather it had a regular suspension and cloth
seats.) You had used this car for approximately one year when it
was new. You then handed it down to the lieutenants who used it
for a year. Thereafter, until it was traded in, it was used by
the detectives. According to you, the mileage on the car did not
reflect the numbers of hours on the engine because the
lieutenants and detectives would frequently leave the car idling
for long periods of time when they were on assignments.

There was testimony that the vehicle bought by your son
required a new exhaust system shortly after it was purchased,
that the electrical system has been a problem and that the
automobile burns oil. Natick Ford sells the vehicles "as is" and
the buyer accepts the risk that the vehicle may have problems.

[4] The check is actually dated 6/4/91. David attributed
that to an error on his part.

[5] The final bill was for $44,190. This was a net bill,
although it did not specify how much had been allowed for each
trade-in. Chase informed us, however, that the trade-in allowance
for the two 1988 LTDs was $500 each and the 1990 LTD was $2,700,
the last being $400 over the GBPC set price. No one could
satisfactorily explain why the 1990 LTD, which had only 49,069
miles on it, did not receive the $1,000 premium established by
the GBPC contract. Indeed, no one could recall exactly how that
trade-in allowance was determined.

[6] Note that Singleton and Galewski involved disposition
agreements in which the subjects paid fines of $1,000 and $1,250,
respectively.

[7] In EC-COI-86-14, cited above, dealing with a vendor's
offer to sell law enforcement officers new cars at $100 "over
invoice, "the Commission stated,

A discount which is available to a discrete public group,
such as law enforcement officers, raises a conflict under s.
23 because the discount is given solely because the
recipients are public officials and for no other reason. See
EC-COI-83-4. There is no statutory authorization or other
justification for providing to law enforcement officers a
privilege which is not available to private citizens or
other public officials. The discount is unwarranted because
it is a privilege "not properly available to similarly
situated individuals, such as members of private groups and
other public employees" [footnote omitted].

[8] See, e.g., In re U.S. Trust, 1988 SEC 386 (systemic
problem with banks wining and dining municipal treasurers); and
In re Whalen, 1991 SEC 514 ("ticket fixing"), both of which were
resolved with public enforcement letters.

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