Docket No. 409

In the Matter of ARthur Hermenau

May 17, 1994

Disposition Agreement


This Disposition Agreement ("Agreement") is entered into
between the State Ethics Commission ("Commission") and Arthur
Hermenau ("Hermenau") pursuant to s.5 of the Commission's
Enforcement Procedures. This Agreement constitutes a consented to
final order enforceable in the Superior Court, pursuant to G.L. c.
268B, s.4(j).

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On February 8, 1989, the Commission initiated, pursuant to
G.L. c. 268B, s.4(a), a preliminary inquiry into possible
violations of the conflict of interest law, G.L. c. 268A, by
Hermenau as Highway Surveyor for the Town of Pembroke. The
Commission concluded its inquiry and, on April 18, 1990, found
reasonable cause to believe that Hermenau violated G.L. c. 268A,
s.3(b).

The Commission and Hermenau now agree to the following
findings of fact and conclusions of law:

1. At all times here relevant, Hermenau was employed as the
Pembroke Highway Surveyor, an elected and salaried position to
which Hermenau was first elected in 1977. As Pembroke Highway
Surveyor, Hermenau was a municipal employee as defined in G.L. c.
268A, s.1(g).

2. Tilcon Massachusetts, Inc. ("Tilcon") is a corporation
doing business in Massachusetts as a paving materials manufacturer
and paving contractor. During the time here relevant, a
substantial portion of Tilcon's business consisted of municipal
paving contracts. Tilcon's contract with the Town of Pembroke was
one of at least twenty contracts Tilcon had with Massachusetts
municipalities in 1987. The balance of Tilcon's business was
commercial, with virtually no individual residential jobs such as
driveways. On the rare occasions when Tilcon paved residential
driveways, such paving was usually done for private customers with
whom Tilcon had an ongoing business relationship or a prior long-
standing business relationship.

3. As Highway Surveyor, Hermenau was responsible for the
maintenance and reconstruction of the town roads in Pembroke and
for the operation of the Pembroke Highway Department. As Highway
Surveyor, Hermenau was responsible for overseeing the bidding and
award process by which the town paving contract was awarded
annually.[1] Hermenau annually advertised the availability of the
contract in area newspapers and sent out by mail invitations to bid
to several area paving contractors, including Tilcon. When bids
were received, Hermenau held a public bid opening and awarded the
contracts.[2] After the town paving contract was awarded, Hermenau
was responsible as Highway Surveyor for determining town paving
needs covered by the contract (i.e., for ordering paving and/or
paving materials pursuant to the contract) and for overseeing the
contractor's performance of its obligations under the contract.

4. In 1986, in bidding for the Pembroke paving contract for
the period of September 1, 1986 through August 31, 1987, Tilcon
submitted the low bid of $27.14 per ton for Class I Bituminous
Concrete in place and was awarded that portion of the town paving
contract by Hermenau. Hermenau awarded the remainder of the
contract to another vendor which had submitted the low bids on the
other two portions of the contract. In 1987, in bidding for the
Pembroke paving contract for the period of September 1, 1987
through August 31, 1988, Tilcon submitted the lowest bid on two out
of three of the contract categories and tied for lowest bid on the
third.[3] Hermenau awarded and split the third portion between
Tilcon and the other low bidding vendor. In 1988, in bidding for
the Pembroke paving contract for the period of September 1, 1988
through August 31, 1989, Tilcon submitted the lowest bid on one
portion of the contract and tied with another vendor for the lowest
bid on the other two contract categories. Hermenau awarded the
contract for the first category to Tilcon and split the contract
award for the other two categories between Tilcon and the other low
bidder.

5. In 1987, Hermenau owned a house in Pembroke with an
unpaved driveway. As of July 1987, Hermenau had personally graded
and prepared the driveway for paving and was anxious to have the
paving done prior to the onset of winter. In July 1987, Hermenau
approached John D'Allesandro ("D'Allesandro"), an employee of
Tilcon with whom he had had dealings as Highway Surveyor in
connection with Tilcon's work for the town, and asked him if Tilcon
could pave his driveway. Hermenau informed D'Allesandro of the
general dimensions of the driveway and told him that he wanted the
work done before winter. D'Allesandro then went to Hermenau's
property, viewed the site and agreed to do the work. According to
Tilcon, D'Allesandro agreed to do the work only after speaking to
and receiving authorization from Tilcon Vice-President and Brockton
Branch Manager Joseph P. McMenimen ("McMenimen"). Before
authorizing the work, McMenimen asked D'Allesandro if Hermenau
agreed to pay for the work and D'Allesandro responded that Hermenau
had agreed to pay for the work, according to Tilcon. Hermenau and
D'Allesandro did not discuss what Hermenau would be charged by
Tilcon for paving his driveway. Hermenau did not ask D'Allesandro
for or receive in advance of the work an oral or written estimate
of the price Tilcon would charge for paving the driveway.[4]

According to Hermenau, he sought to have Tilcon pave his
driveway because he wanted his driveway done with a paving machine
and roller, he wanted the job done before winter, he was familiar
with Tilcon as the town contractor and he had been satisfied with
Tilcon's work for the town. At the time in question, the reputable
smaller paving companies in

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the Pembroke area that did residential driveway paving did not
possess paving machines and spread materials by hand and, further,
were booked up to a year in advance with other projects and would
not have been able to pave Hermenau's driveway prior to winter.

7. In July 1987, Tilcon placed 80.21 tons of Class I
Bituminous Concrete on Hermenau's driveway as a base or "binder"
course. The July 1987 work required the use of a Tilcon paving
machine and a roller and a Tilcon crew consisting of a foreman, a
paver operator, a roller operator, two asphalt rakers and two
laborers. In November 1987, Tilcon finished paving Hermenau's
driveway by installing a second layer of 55.18 tons of Class I
Bituminous Concrete. The November 1987 work required the use of a
Tilcon paving machine and a roller and a Tilcon crew consisting of
a foreman, a paver operator, a roller operator, two asphalt rakers
and three laborers. Tilcon's use of a paving machine to install
Hermenau's driveway resulted in a smoother, more aesthetically
attractive and durable driveway than would have been possible by
means of handraking and a roller alone, which would have been the
method employed by a smaller local residential paving contractor.

8. In August 1987, Tilcon submitted a lump sum invoice to
Hermenau and Hermenau paid Tilcon $2,265.53 for Tilcon's July 1987
paving work on his driveway.[5] In November 1987, Tilcon charged
Hermenau and Hermenau paid $1,510.03 for the paving work completing
his driveway. Tilcon's November 1987 bill recited that it was for
"Class I Bit. Concrete in place as directed, 55.18 tons at $27.09
a ton," and contained an "asphalt adjustment" charge of $15.20.[6]

9. In both August and November 1987, Tilcon charged
Hermenau and Hermenau paid the same rate as Tilcon
then charged the Town of Pembroke for paving under the town
paving contract that Hermenau awarded to Tilcon ("the town rate"). During the period here relevant, Hermenau was the only Pembroke homeowner whose driveway was paved by Tilcon as an independent project and the only private
customer in Pembroke charged the town rate by Tilcon for paving
work. Tilcon agreed to pave Hermenau's driveway and charged
Hermenau the Pembroke town rate[7] because Hermenau was the
Pembroke Highway Surveyor and also, according to Tilcon, in part
because the company made a profit on the work.[8]

10. The rate for paving charged by Tilcon under the Town of
Pembroke paving contract ("the town rate") was in part determined
by the total quantity of paving purchased by the town, i.e., the
town paid less per ton for paving than it would have paid had it
contracted with Tilcon for significantly less paving. In charging
Hermenau the town rate for the paving of his driveway, Tilcon
conferred upon Hermenau the benefit of the reduced per ton cost
charged to the town based upon the relatively large quantity of
paving the town purchased from Tilcon.[9] In addition to and apart
from the benefit represented by being charged the town rate,
Hermenau's access to Tilcon's paving services was itself a benefit
to Hermenau. Not only was Tilcon able to work before winter as
Hermenau wanted, at a time when other contractors were not
available, but Tilcon was able to do the work at a higher standard
of quality than a small local driveway contractor would have been
able to achieve.

11. Section 3(b) of G.L. c. 268A prohibits a municipal
employee from seeking or receiving anything of substantial value
for or because of any official act or act within his official
responsibility performed or to be performed by the municipal
official.

12. By approaching Tilcon's employees in order to obtain
Tilcon's services to pave his driveway, by receiving Tilcon's
paving services, and by paying for those services at the town rate,
all while Tilcon was a bidder on the town paving contract and a
town vendor subject to his official authority as Highway Surveyor
to award the town paving contract and to oversee its performance,
Hermenau sought and received from Tilcon benefits for himself which
were of substantial value[10] for or because of official acts or
acts within his official responsibility performed or to be
performed by him as Highway Surveyor. In doing so, Hermenau
violated G.L. c. 268A, s.3(b).

13. The Commission is aware of no evidence that Hermenau knew
at the time he sought and received Tilcon's services to pave his
driveway that his actions violated G.L. c. 268A, s.3.[11] The
Commission is also aware of no evidence that as Highway Surveyor
Hermenau offered to Tilcon or Tilcon sought from Hermenau any
specific official action concerning any matter which would affect
Tilcon in return for its provision to him of the above-described
benefits.[12] However, even if the provision of the benefits was
only intended to create official goodwill, Hermenau's receipt of
those benefits was still impermissible.[13]

In view of the foregoing violations of G.L. c. 268A, the
Commission has determined that the public interest would be served
by the disposition of this matter without further enforcement
proceedings, on the basis of the following terms and conditions
agreed to by Hermenau:

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(1) that Hermenau pay to the Commission the sum of one
thousand dollars ($1,000.00) as a civil penalty for
violating G.L. c. 268A, s.3(b)[14];

(2) that Hermenau forfeit the sum of five hundred
dollars ($500.00) for the approximate economic benefit he
unlawfully derived from his violating s.3(b); and

(3) that Hermenau waive all rights to contest the
findings of fact, conclusions of law and terms and
conditions contained in this Agreement in this or any
other related administrative or judicial proceedings to
which the Commission is or may be a party.

---------------

[1] In the Town of Pembroke, the town paving contract is put out to
bid and awarded annually by the Town Highway Surveyor. The town
paving contract covers Pembroke's paving needs for the twelve month
period, September 1st through August 31st. During the time here
relevant, the contract had three components, each of which could be
separately awarded to a different vendor with the lowest bid as to
that component, or divided between vendors with tying bids as to a
component: (1) 6000 tons of Class I Bituminous Concrete in place;
(2) 1500 tons of Bituminous Concrete Type I; and (3) 1500 tons of
Asphalt Stockpile Mix to be picked up at the vendor's plant.


[2] Hermenau's primary criterion for awarding the contract was the
price bid, i.e., the contract was generally awarded to the lowest
bidder. When the prices bid were close, however, Hermenau had
discretion to consider other factors in awarding the bid, such as
the distance from the town of the bidders' manufacturing plants,
the reputation of the bidders and his own knowledge of any prior
problems with the bidders. During the time here relevant, except
for a single instance not here material, the contract was always
awarded to the low bidder or split between bidders who had
submitted the same low bid.

[3] Tilcon bid a price of $27.09 per ton for Class I Bituminous
Concrete in place.

[4] The price charged Hermenau by Tilcon for its work in paving the
driveway was determined by McMenimen. The agreement pursuant to
which Tilcon paved Hermenau's driveway was oral and was not reduced
to writing.

[5] Tilcon's records show that this invoice was for 80.21 tons of
binder, tax included.

[6] Hermenau was not charged and did not pay any tax when he paid
Tilcon for the November 1987 work.

[7] The Commission is aware of no evidence that Tilcon and Hermenau
actually negotiated the application of the town rate to Tilcon's
charges for paving Hermenau's driveway. After the July 1987 paving
work was completed, Tilcon unilaterally decided to charge Hermenau
the town rate for the paving of his driveway in part because,
according to Tilcon, the company believed that it was a fair way to
price the work on the driveway (which was similar to a small
street).

[8] The Commission is aware of no evidence that Hermenau sought and
received or Tilcon provided these benefits to Hermenau in return
for his being influenced in his performance of any specific
official act as Highway Surveyor or any particular act within his
official responsibility as Highway Surveyor.

[9] Hermenau would have paid approximately $500 more than he was
charged by Tilcon for the paving of his driveway if he had dealt
with a private contractor at the then customary market rate.

[10] Anything which has a value of $50 or more is of substantial
value for the purposes of the conflict of interest law. See
Commonwealth v. Famigletti, 4 Mass. App. 584 (1976).

[11] Ignorance of the law is no defense to a violation of the
conflict of interest law. In re Doyle, 1980 SEC 11, 13; see also
Scola v. Scola, 318 Mass. 1, 7, (1945).

[12] The Commission is further aware of no evidence that Hermenau's
above-described private dealings with Tilcon had any effect on
Tilcon's performance of its paving contract with the Town of
Pembroke or on Hermenau's performance of his duties as Highway
Surveyor.

[13] As the Commission made clear in its decision In re Michael,
1981 Ethics Commission 59, 68, and in Advisory No. 8, s.3 of G.L.
c. 268A is violated even where there is no evidence of an
understanding that the gratuity is being given in exchange for a
specific act performed or to be performed. Indeed, any such quid
pro quo understanding would raise G.L. c. 268A, s.2 issues.
Section 2 is not applicable in this case, however, as there was no
such quid pro quo between Tilcon and Hermenau.

[14] While the Commission is empowered to impose fines of up to
$2,000 for each violation of G.L. c. 268A, s.3, the Commission
has determined that it is in the public interest to resolve this matter
with a $1,000 fine because the prohibited conduct in this case was
apparently a single incident and not part of a pattern or practice
of misconduct and involved a relatively small amount of value given
and received.

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