Public Enforcement Letter 89-6

Robert LaFrankie
c/o Michael McCarthy, Esq.
70 Allen Street
Pittsfield, MA 01201

February 14, 1989

Dear Mr. LaFrankie:

As you know, the State Ethics Commission has conducted a
preliminary inquiry regarding an allegation that as Superintendent
of the Pittsfield schools, you traveled at the expense of the
ServiceMaster Company, a private custodial services company, to
Chicago to view the ServiceMaster home offices and laboratories,
subsequent to which the City of Pittsfield entered into a contract
with ServiceMaster for school custodial services. The results of
our investigation (discussed below) indicate that the conflict of
interest law may have been violated in this case. 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 the
facts revealed by our investigation and by explaining the
application of the law to such facts, trusting that this advice
will ensure your ffiture 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 Superintendent of the
Pittsfield schools, and as such, a 'municipal employee" as defined
in G.L. c. 268A, s.1(g). ServiceMaster is a private company, based
in Chicago, Illinois, which provides cleaning supplies and
maintenance and custodial management services to its clients.

2. During the summer of 1986, ServiceMaster approached the City
of Pittsfield and proposed conducting a survey of the city's
buildings in order to assess maintenance problems and to propose
a custodial management plan. (Until that time, city custodial
personnel had handled all janitorial duties in city buildings.)
ServiceMaster's "sales pitch" in making their proposal centered on
the claim that their proposed local operations would have the
support and backup of the corporate offices in Illinois. Pursuant
to their claims, ServiceMaster repeatedly extended invitations to
city officials, in particular School Committee members, to visit
its corporate headquarters.

3. You felt that the trip was necessary in order to learn more
about the company and to assess the credibility of ServiceMaster's
sales pitch.

4. On Monday, August 11, 1986, you and the Mayor met at the
school administration building and drove to the Albany airport. You
boarded a 5:00 P.M. flight to Chicago, paid for by ServiceMaster
at a cost of $540 for each round trip ticket. Upon your arrival in
Chicago, you went to dniner at the Ninety-Nine Restaurant, which
was paid for by ServiceMaster in an amount totaling $261.09 ($52.22
per person). You were then taken to the Sheraton Naperville Hotel
where you were provided with a room at ServiceMaster's expense,
costing $74.12.

5. The next morning, five of you had breakfast at the hotel,
paid for by ServiceMaster in an amount of $32.66 ($6.53 per
person). You were then driven to ServiceMaster's corporate
headquarters where you spent the day touring the facilities and
speaking with ServiceMaster personnel. Lunch was served at the
headquarters in a private dining room ad was followed by more tours
of various ServiceMaster departments. At the end of the day, you
went directly to the airport and flew back to Albany, New York.

6. In September, 1986, the City Council voted not to recommend
hiring ServiceMaster for city buildings (other than school
buildings). The School Committee, however, maintained an interest
in ServiceMaster's

Page 395

proposal.

7. In the fall of 1986, the Mayor appointed a committee to
study the issues of maintenance in the public schools. This
committee was to study the feasibility of having city personnel
continue handling custodial management of the school buildings,
rather than contracting the services out to a management company.

8. During the late fall of 1986 and early winter of 1987, the
School Committee considered three options for custodial management:
ServiceMaster's proposal, a proposal by the Crothall-American
Company, and local proposals. In February, 1987, the mayoral
committee voted that, with minor modifications and an upgrading of
equipment, the existing system of building custodial maintenance
for the city schools was sufficient. In February, 1987, however,
you recommended that the School Committee award Service Master the
contract.Your recommendation was based upon a written detailed
financial analysis of the various proposals which had been
submitted.

9. On March 4, 1987, the School Committee, acting on your
recommendation, approved the ServiceMaster proposal. This a three-
year agreement, contingent on annual renewal by the School
Committee, with a total cost of $1,496,222.00 (which includes the
payroll for all school department custodial employees).

10. The trip to Chicago was a "no frills" trip. There were no
gifts or lavish entertainment. Thus, the only benefits enjoyed by
you consisted of the direct payments for your travel, lodging and
meals as described above.

11. The Commission finds no corrupt intent on your part in
connection with the above described conduct.

12. The Commission knows of no evidence that you were aware
that these payments may have violated the law. In fact, there
appears to be a widespread misconception among public employees
that such payments are permissible.



II. The Conflict Law



As the Pittsfield Superintendent of Schools, you were a
municipal employee for the purposes of the conflict of interest
law, G.L. c. 268A. Section 3(b) of G.L. c. 268A prohibits a
municipal employee, otherwise than as provided by law for the
discharge of his official duties, from requesting or accepting for
himself anything of substantial value for or because of official
acts performed or to be performed.

Your acceptance of ServiceMaster paying for your trip expenses
as described above raises serious concerns under s.3(b). As the
Commission said in EC-COI-88-5 (issued on February 3, 1988),
A selection committee's work on behalf of a procuring agency of
the commonwealth to eyaluate prospective vendors would clearly
constitute the performance of an official act. Receipt of
anything "of substantial value"[1] for such travel would
generally constitute a violation of s.3(b) [citations omitted].

This subsidized travel is available to selection committee
members precisely for or because of their official acts
....[T]ravel expenses which are paid by the manufacturer would
be of substantial value in most, if not all, situations and
would violate s.3(b) of the statute [footnotes omitted].

The Commission also made clear in EC-COI-5-5 that it rejects the
contention that the value of the trip expenses in cases like this
accrues to the municipality and not to the individual traveler.
In the Commission's view the value is a benefit to the individual
traveler. See, 1986 EC 271.

There are good public policy reasons for prohibiting these kinds
of payments. As the Commission stated in EC-COI-82-99 (dealing
with members of a state board of registration traveling to view
types of equipment proposed by a manufacturer for approval by the
board where travel expenses were to be paid by the manufacturer),

A system wherein the manufacturers of products pay for trips by
state employees is clearly open to abuse by the state employees
as well as the manufacturers. State employees could exploit
this system in order to procure unwarranted privileges. And, the
public impression that state employees were improperly
influenced in their decisions could arise. Manufacturers, on
the other hand, may view the quality of the accommodations and
accouterments on these trips as more important than the quality
of their product.

We would note that G.L. c. 44, s.53 may provide a statutory
vehicle by which a private party may pay travel expenses for public
officials. This section of the municipal finance law would appear
to allow a city to accept grants or gifts of fimds from a
charitable

Page 396

foundation, private corporation or an individual and, in turn, the
city may expend such funds for the specific purpose intended with
the approval of the mayor and the board of aldermen. Chapter 44,
s.53A also states that such funds shall be deposited with the
treasurer of such city and held in a separate account. In other
words, if ServiceMaster desired to pay the travel expenses of
members of the School Committee to attend a fact-finding trip to
ServiceMaster's headquarters, ServiceMaster probably could do so
by providing the necessary amount to the city Treasurer stating
that the "gift" is to be used to pay such travel expenses[2] This
mechanism provides for scrutiny by the city treasurer/auditor as
to the reasonableness of the expenses incurred by public employees.
Presumably, the use of such a mechanism would substantially reduce
the potential for abuses described in EC-COI-82-99.



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[3] This matter is now closed. If you have
any questions, please contact me at 727-0060.

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[1] It has been held that $50 in cash is "of substantial value."
Commonwealth v. Famigletti, 4 Mass. App. 584(1976).

[2] The application of G.L. c. 44, s.53A to trips such as these is
ultimately a matter of municipal finance law. Before the School
Committee were to rely on this section, it probably should review
the issue with corporation counsel. (Alternatively, the city
presumably could reimburse an employee for trip expenses in the
normal course, then bill Service Master for those costs. Again
this alternative should be reviewed with corporation counsel.)

[3] The Commission could have directed the staff to commence
adjudicatory proceedings in which, if you were found to have
violated s.3, fines of up to $2,000 for each violation could be
imposed. The Commission chose to resolve this matter with a public
enforcement letter because (1) there appears to be a widespread
misconception among public employees that such payments are
permissible; (2) there were no "frills" involved in these trips;
and (3) the Commission knows of no evidence that you were aware
that these payments violated the law.