Lawyer says park can contract with commissioner’s company

Chagrin Valley Times

Thursday, May 17, 2018

by Krista S. Kano

The newest member of the Geauga Park District Board of Commissioners has done and continues to do business with the park district involving thousands of dollars yet has not violated Ohio ethics laws or park bylaws, according to state and local officials.

Howard Bates, the owner of Arms Trucking Company in East Claridon, was sworn in as a park commissioner on Dec. 29, 2017 by Geauga County Probate Judge Timothy Grendell.

According to Geauga County Auditor public documents provided by the park district, Mr. Bates’ company has consistently been awarded bids for aggregate stone materials since 2014. Between Jan. 1, 2014 and Dec. 31, 2017, the park district paid Mr. Arms’ company $240,980 for aggregate material, as well as road salt, according to park district records.

The park district provided accounts payable invoice reports from three companies – Arms, Mapledale Farm Inc. and Ontario Stone Corporation – that have frequently split the contracts for the yearly aggregate orders. Interoffice memos obtained by the Times show that Arms typically offered lower prices than their counterparts, and so were awarded the bulk of the bids.

Under state law, publicly funded bodies such as municipalities and park districts advertise for bids and award contracts based on the lowest and best bid of those submitted.

In 2014 for example, park officials recommended that the stone bid for 2014 be split between Arms, Mapledale and Ontario. Arms offered the lowest price for all but three types of aggregate materials. Ontario, however, received no payments in 2014 from the park district, although stone quotes show that the company offered the lowest price for three types of limestone to be used at the West Woods park in Russell. Mapledale offered the highest prices for all stones, but was paid $102 on June 9, 2014 for gravel, in addition to payments for landscaping materials and road salt. Arms received $68,650.23 for stone as well as road salt throughout 2014, according to park district records.

In 2015, Grounds and Facilities Manager Brett Bellas recommended using Arms and Ontario “depending on the stone pricing and the availability of the trucking to specific job sites.” That year, Ontario was paid $21,250.36 and Arms was paid $74,436.46.

In 2016, Mr. Bellas recommended using both Arms and Ontario again. Ontario received no payments and Arms received $35,074.70. The same recommendation was made in 2017, and Ontario received no payments and Arms received $62,819.19.

In February 2018 when Mr. Bates was serving as a district park commissioner, Arms was awarded another contract for the 2018 stone material bid, along with the Shelly Company. Prior to discussions, Mr. Bates acknowledged that he was the owner of Arms, and he did not participate in deliberations and did not vote on the matter.

According to the documents, Arms and Shelly were the sole bidders. Park planner Annie Lynch wrote in a memo to Director of Planning and Operations Matt McCue that after reviewing the bid materials, Arms was the low bid for all materials except two types of limestone. She recommended that Arms Trucking be awarded the bid for everything except the limestone, which should be awarded to Shelly Company. Mr. McCue extended that recommendation to Executive Director John Oros in a memo dated Feb. 1. Board President Andrej Lah and Board Vice President Jackie Dottore voted in favor of awarding the bids accordingly.

After the Times requested documentation about the financial history between the district and Arms Trucking, Mr. Oros sent the newspaper a legal opinion from attorney Thomas G. Lobe, noting, “This information pertains to your records requests related to Aggregate Contracts and most recently the Bid Awards at Tuesdays’ Park Board meeting.  Given your inquiries on these matters, we trust the contents of the attached will assist you in providing an accurate account of this topic for your readers.”

According to Mr. Lobe, who also serves as the law director for the City of Solon, “A Park District Park Commissioner is not precluded from serving on the Park Board of Commissioners by reason of the fact that said Commissioner is a principal in a business that has routinely provided trucking services to the Park District in past years and is expected to continue to bid for trucking contracts in the future, and said commissioner’s business/entity may continue to conduct business with the Park District so long as the Commissioner does not participate in any discussion or advocates hiring such company and also recuses himself from voting on any contracts involving the business.”

In his reasoning, Mr. Lobe cited a 2011 Ohio Attorney General opinion that states, “Although a conflict of interest may arise between two positions, opinions of the Attorney General have determined that, if a person serving in both positions is able to remove himself from the conflict by abstaining from participating in deliberations, discussions, negotiations, or votes related to the conflict, the person may serve in both positions at the same time.”

Mr. Lobe also cited the Board of Park Commissioners bylaws, which mirror the attorney general’s assertions. It states, “No contract or business relationship shall be entered into between the Geauga Park District and a Commissioner or any entity in which that Commissioner or his or her family have significant interest, unless the material facts of the relationship and transaction are disclosed or are made known to the Board and a majority of the disinterested commissioners specifically authorize the contract or business relationship.”

The bylaws continue, “No Commissioner shall solicit personal favors or exert – direct or implied –influence on any Geauga Park District employee in order to gain business or personal favors from himself.”

Ohio Ethics Commission Executive Director Paul Nick said that state ethics laws do extend to park district commissioners, and that a commissioner with a financial interest in a contract cannot participate in discussions and cannot vote.

A similar issue arose in Burton when then-Councilman Craig Ronyak, an employee of Ronyak Paving, participated in discussions about a public contract between his company and the village. Mr. Ronyak’s error in the matter, according to Mr. Nick, was that “the law would not only prohibit the councilman from voting, but also from participating in deliberations on the matter.”

Neither Mr. Bates nor Mr. Oros responded to the Times’ request for comment.

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