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Letter Ruling

Letter Ruling Public Enforcement Letter 88-2: Senator John P. Burke

Date: 12/03/1987
Organization: State Ethics Commission
Referenced Sources: G.L. c. 268A, the Conflict of Interest Law

Table of Contents

Senator John P. Burke

Dear Senator Burke: 

As you know, the State Ethics Commission has conducted a preliminary inquiry regarding your receipt of a rifle from Savage Industries of Westfield, Massachusetts, given in recognition of your efforts as a State Senator on behalf of that company. 

The results of our investigation (discussed below) indicate that you may have violated the conflict of interest law in this case. Nevertheless, in view of certain mitigating factors, also discussed below, the Commission has determined that adjudicatory proceedings are not warranted. Rather, the Commission has concluded that the public interest would be better served by disclosing the facts revealed by our investigation and explaining the applicable provisions of law, trusting that this advice will ensure both your and other government employees' future understanding of and compliance with the conflict 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. Facts

1. You are the State Senator for the Chicopee, Westfield, Holyoke and Southampton area. You have served in that capacity for approximately nine years. One of your Senate responsibilities is the chairmanship of the Legislature's Banks and Banking committee. 

2. Savage Industries (Savage) is a gun manufacturing company which currently operates in Westfield. The company was previously located in Chicopee. 

3. Approximately one week before Thanksgiving, 1985, you received a telephone call from Tim Sullivan, head of the employees union at Savage, asking if you would attend a lunch with retirees of Savage. At that time, Sullivan explained to you that Savage was having substantial financial difficulties and it appeared that the company might go bankrupt. Sullivan requested your help in attempting to keep the company operating. 

4. From that point through April, 1986 you spent substantial hours attempting to keep Savage from going out of business. You contacted Fleet National Bank in Rhode Island, with which Savage had a substantial debt. At the time all proceeds of gun sales that came in as accounts receivable to Savage were turned Over to Fleet National, which in turn provided a check to Savage to cover the minimum cost of a maintenance crew. By this time Savage was no longer operating and the maintenance crew was paid merely to keep the building and machinery from going into disrepair. 

5. You met with one of Fleet National's lawyers and an agreement was reached to provide Savage time to find alternative financing. Fleet National also agreed 

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to provide Savage additional money from accounts receivable to cover the costs of health benefits for laid off employees. At this time Savage had a negative net worth. 

6. You additionally met with Paul Eustace, Secretary of Labor for the Commonwealth, and discussed the possibility of obtaining state loan money which is available to help distressed companies. Secretary Eustace had independently determined to send in a management team, which analyzed the situation. 

7. Secretary Eustace, through the Industrial Service Program,[1] began working with Fleet National towards relieving Savage's financial problems. You participated in these discussions at the request of both Secretary Eustace and Fleet National. 

8. Bay State Investors began reviewing the Savage situation and considered investing in the business. Bay State Investors agreed to do so if Thrift Fund[2] money was available from the state of Massachusetts. A loan was made available to Savage from the Industrial Services Program and additional money was made available from the Thrift Fund. You state that you had no contact with Bay State Investors until after Secretary Eustace had involved them in the process. 

9. The above described arrangements were consummated in April of 1986, and the company and union had an awards ceremony where Paula Gold, Secretary of Consumer Affairs, presented a $2,000,000 check from the Thrift Fund to the company. Both Secretary Eustace and you were honored at the ceremony and presented with plaques. Sometime after the ceremony Tim Sullivan and Savage's Chief Executive Officer, General Freedman, presented you with a rifle manufactured by Savage. 

10. When originally contacted by this office, you stated that you thought that the rifle was not meant to be used and could not be fired. You subsequently checked into this and found that the gun can be fired, but was not designed for actual use. Apparently, the gun was one of a group that was made by the company to be given as gifts, but should not be used for hunting or shooting purposes. You state that you are not a hunter and you had not taken the gun out of the original box. Your recollection was that someone told you that the rifle was worth approximately $700 at the time that it was presented to you. A check with the company revealed that the retail value of the gun is $428. On November 6,1987 you returned the rifle to Savage.

II. The Conflict Law

As a State Senator, you are a state employee for the purposes of the conflict of interest law, G.L. c. 268A. Section 3(b) prohibits a state employee, otherwise than as provided by law for the proper discharge of his official duty, from accepting anything of substantial value for himself for or because of any official act or act within his official responsibility performed or to be performed by him. 

As the Commission stated In the Matter of George Michael, 1981 SEC 59,68: 

A public employee may not be impelled to wrongdoing as a result of receiving a gift or gratuity of substantial value in order for a violation of s.3 to occur. Rather, the gift may simply be a token of gratitude for a well-done job or an attempt to foster goodwill. All that is required to bring s.3 in to play is a nexus between the motivation for the gift and the employee's public duties. If this connection exists, the gift is prohibited. To allow otherwise would subject public employees to a host of temptations which would undermine the impartial performance of their duties, and permit multiple remuneration for doing what employees are already obliged to do a good job. 

For the purposes of G.L. c. 268A, "substantial value" has been determined to be anything valued at more than $50. See Commonwealth vs. Famigletti, 4 Mass. App. 584,587(1976); Commission Advisory No.8, February 25,1986. 

The facts set forth in this letter, if proven, would appear to establish a violation of s.3. Thus you accepted the rifle as a token of gratitude by the company for your efforts as a Senator in obtaining refinancing for the company. This is exactly the kind of conduct covered by the language quoted from Michael, above. See, also, A Practical Guide to the Conflict of Interest Law and Financial Disclosure Law for State Employees, p. 3-4. 

Nevertheless, there are several mitigating factors here. The role that you took in assisting Savage was a normal part of your constituency services you were helping a company which is located in your district and employs over 400 people. In addition, you listed the gift in your financial disclosure form, so that obviously you were not attempting to conceal its receipt. Furthermore, the gift was given after the services were rendered and after all the critical steps involving state assistance had been completed, so that it clearly represents a token of appreciation rather than an inducement to you to intervene on behalf of the company. Last, you have returned the rifle to Savage. 

Because of the above mitigating factors, the Commission has decided that this case does not warrant the initiation of formal adjudicatory proceedings.

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

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[1] The Industrial Services Program was established by legislation several years ago to help "mature" Massachusetts industries deal with severe financial difficulties. The program is jointly run through the Executive Office of Consumer Affairs and the Executive Office of Labor, 

[2] The Thrift Fund is a $100 million direct lending pool established to facilitate economic development initiatives throughout Massachusetts. The Fund's paramount objective is the creation and retention of jobs. The funds come from banking institutions. Targeted areas include mature industries such as Savage.

Referenced Sources: