Docket No. 557
In the Matter of Richard Penn
Date: August 9, 1996
This Disposition Agreement ("Agreement") is entered into
between the State Ethics Commission ("Commission") and Richard Penn
("Penn") 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,
On March 8, 1995, 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 Penn. The
Commission has concluded its inquiry and, on August 8, 1996, found
reasonable cause to believe that Penn violated G.L. c. 268A.
The Commission and Penn now agree to the following findings of
fact and conclusions of law:
1. During the time relevant, Penn was a member of the Revere
City Council. As such, Penn was a municipal employee as that term
is defined in G.L. c. 268A, s.1(g).
2. Penn is also an employee of Wonderland Greyhound Park,
Inc. ("Wonderland"). Wonderland and Westwood Development, Inc. are
wholly owned subsidiaries of Westwood Group, Inc. ("WGI").
3. WGI owned fifteen acres of land abutting Wonderland
Greyhound Park. WGI had used the land
to secure a $3 million loan from U.S. Trust Company. In December
1983 WGI conveyed the property to Wonderland subject to U.S.
Trust's mortgage, and Wonderland assumed WGI's mortgage note as a
co-obligor. In May 1992 Westwood Development, Inc. used nine acres
of the property to secure a $4.5 million note from MSCGAF Realty
Trust. Wonderland agreed to act as a guarantor of Westwood
Development's $4.5 million note. On April 15, 1993, Revere Realty
Group, Inc. took title to lots 6, 7, & 8 of the parcel. Thus,
Westwood Development owned nine acres of the original fifteen
acres, while Revere Realty Group owned the remaining six acres.
4. On March 22, 1993, Penn sought advice from the Commission
on whether he could participate in the Revere City Council's review
of the special permit application submitted by the Revere Realty
Trust. Penn disclosed that Revere Realty Trust was seeking to
build a shopping center on land owned by the general manager for
Wonderland and by Wonderland itself, and that he was an employee of
Wonderland and a city councilor.
5. On April 12, 1993 the Commission's Legal Division issued
an informal advisory opinion to Penn, which provided in pertinent
part as follows:
Section 19 prohibits municipal employees from
participating in particular matters in which they or their
immediate family members or partners, or a business
organization in which he is serving as officer, director,
trustee, partner or employee has a direct or reasonably
foreseeable financial interest. See, e.g. EC-COI-89-19. The
financial interest must be "direct and immediate, or at least
reasonably foreseeable." EC-COI-84-123; 84-98; 86-25; 84-96.
Under s.19, your employer's financial interests are
imputed to you. Since the [Wonderland Greyhound] Park has a
financial interest in the special permit, you may not
participate as a city councilor in that particular matter.
Participation includes discussion and informal lobbying of
colleagues, as well as voting (binding and non-binding). EC-
COI-92-30. Under s.19, if any financial interest is
implicated, no matter how small, or whether the affect is
positive or negative, participation is impermissible. EC-COI-
6. National Development Associates of New England ("National
Development"), the developer of the fifteen acres, planned to build
a 157,500 square-foot retail shopping complex on the property. On
July 9, 1993, National Development submitted a special permit
application to the Revere City Council to exceed the 10% retail use
restriction for the zoning area encompassing the property.
National Development's purchase and sale agreement was conditioned
on the City's issuance of the special permit. The permit
application listed Revere Realty and Westwood Development as the
owners of the affected land.
7. Pursuant to the advice received from the Commission, Penn
attended but did not participate in an August 30, 1993 City Council
public hearing on the special permit application.
8. On November 17, 1993, Penn submitted a letter to Revere
City Planner Frank Stringi, which provided in pertinent part as
So as to address concerns of the abutters to Wonderland
Marketplace, please run the following conditions by Jack
O'Neil [National Development's Representative]:
1. No business will be allowed to be open to the public
between the hours of 12 midnight to 7:00 a.m.
2. No deliveries nor trash pickups will be allowed between
the hours of 10:00 p.m. and 7:00 a.m.
Also, in order to make exiting onto North Shore Rd.
safer, I would recommend that the west side of No. Shore Rd.
from Butler Circle to Kimball Ave. be designated as no
parking. (State approval is needed). The three houses near
Kimball should be allowed to purchase resident stickers.
In my opinion, the costs for a pedestrian walkway across
No. Shore Rd. at the Wonderland MBTA should be borne by the
State and MBTA, not New England Development.
9. According to a November 23, 1993 memorandum from City
Planner Stringi to the Site Plan Review Committee and the city
council, a December 2, 1993 Site Plan Review meeting was scheduled
to discuss issues relating to the revised site plan for National
Development's Wonderland Marketplace project. Stringi's memorandum
highlighted nine changes from the original site plan, including the
construction of a pedestrian walkway area. In addition, Stringi's
memorandum states that "Other mitigation measures to be discussed
at this site plan review meeting include: restriction on hours of
deliveries and store operation ...."
10. On December 13, 1993, the City Council approved the
special permit subject to eight pages of conditions, based on
recommendations made by the Site Plan Review Committee. Two of
Penn's recommendations were incorporated as conditions to the
permit: that no deliveries or trash pickup be allowed between the
hours of 10:00 p.m. and 7:00 a.m.; and that parking be removed
along the west side of North Shore Road. With regard to Penn's
recommendation on the pedestrian walkway, the permit required only
that National Development study the feasibility of constructing a
pedestrian overpass in coordination with the MBTA and the state
11. General Laws c. 268A, s.19 prohibits a municipal employee
from participating as such in any particular matter in which,
to his knowledge, his employer has a financial interest.
12. The decision by the city council on National
Development's special permit application was a particular matter.
13. Penn's employer, Wonderland Greyhound Park, had a
financial interest in this particular matter as follows. First,
the likelihood of Wonderland Greyhound Park's, as a guarantor,
having to cover Westwood Development, Inc.'s $4.5 million mortgage
note was directly linked to Westwood Development, Inc.'s ability to
pay its debts. Second, Westwood Development, Inc.'s (and Revere
Realty Group, Inc.'s) ability to pay its debts was certainly
affected by its sale of the property securing the note. Third, the
sale of the property was conditioned on the city council's issuance
of the special permit. Therefore, Wonderland Greyhound Park, Inc.
had a financial interest in the special permit particular matter.
14. By seeking and receiving an informal advisory opinion
from the Commission, Penn knew that his employer, Wonderland
Greyhound Park, had a financial interest in the sale.
15. Penn participated as a city councilor in that particular
matter on November 17, 1993, by recommending conditions for the
special permit to City Planner Stringi.
16. Accordingly, by making recommendations that ultimately
helped shape the special permit proposal for a vote, Penn
participated as a city councilor in a particular matter in which
his employer had a financial interest. Therefore, Penn violated
17. Penn's violation is aggravated by his having received an
April 12, 1993 warning from the Legal Division not to participate
in the matter.
In view of the foregoing violations of G.L. c. 268A by Penn,
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 Penn:
(1) that Penn pay to the Commission the sum of five hundred
dollars ($500) as a civil penalty for violating G.L. c. 268A,
(2) that Penn 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
 Although Penn's request for advice from the Commission
disclosed that Revere Realty Trust was submitting a special permit
application for developing the property, National Development
actually submitted the application.
 The Site Plan Review Committee had the responsibility of
developing a list of conditions establishing the terms under which
the city council could grant the special permit.
 General Laws c. 268A, s.1(j) defines participation as
"participate in agency action or in a particular matter personally
and substantially as a ... municipal employee, through approval,
disapproval, decision, recommendation, the rendering of advice,
investigation or otherwise." To participate in the formulation of
a matter for a vote through work sessions is to participate in the
matter. Graham v. McGrail, 370 Mass. 133 , 138 (1976).
 General Laws c. 268A, s.1(k) defines particular matter as
"any judicial or other proceeding, application, submission, request
for a ruling or other determination, contract, claim, controversy,
charge, accusation, arrest, decision, determination, finding, but
excluding enactment of general legislation by the general court and
petitions of cities, towns, counties and districts for special laws
related to their governmental organizations, powers, duties,
finances and property."
 "Financial interest," the term "financial interest"
means any economic interest of a particular individual that is not shared
with a substantial segment of the population of the municipality.
See Graham v. McGrail, 370 Mass. 133 , 345 N.E. 2d 888 (1976). This
definition has embraced private interests, no matter how small,
which are direct, immediate or reasonably foreseeable. See EC-COI-
84-98. The interest can be affected in either a positive or
negative way. See EC-COI-84-96.
 The Legal Division advised Penn that his prohibited
participation included "discussion and informal lobbying of
colleagues, as well as voting (binding and non-binding)." The
language "discussion and
informal lobbying" was broad enough to place Penn on notice that he
should not inject himself into the process by recommending
conditions to be placed on the special permit.
End of Decision