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Tuesday, January 16, 2018 by Jessi Devenyns
Ex-Austin Energy employee found not guilty of ethics violation
After a drawn-out series of hearings over the last seven months, the Ethics Review Commission on Jan. 10 found that retired Austin Energy supervisor Stefan Sasko made no violation of the city’s ethics regulations.
However, the ruling may have implications for how the city code concerning conflict of interest is interpreted in the future. Nathan Wiebe, chief of investigations for the Office of the City Auditor, told the Austin Monitor that changing the accepted interpretation with the city legal department to align with the one that was taken by the commission at its last meeting could be financially cumbersome.
Currently, Wiebe explained to the Monitor, “We evaluate whether or not there is a relationship. Not the compensation the person is actually receiving.” If the interpretation the commission took at its last meeting becomes the precedent against which all conflict of interest investigations are measured, “it’s going to be a lot harder for my folks to investigate,” said Wiebe.
In July, the Austin Monitor reported that Wiebe filed a complaint alleging Sasko violated city ethics regulations by engaging in numerous decisions affecting contracted payments to Pike Electric, where two of his brothers worked.
The decisions in question were defined by the Office of the City Auditor as Sasko’s ability to approve or reject submissions for payment. Out of the 1,965 submissions, 26 were rejected over the course of the contract. In total, Pike Electric was paid $8.1 million.
At the last hearing at the commission, Weibe noted: “We don’t have any reason to believe that any of the payments were approved inappropriately.” Despite the questionable practice of having one relative approve payments to another, it was merely the fact that Sasko was authorized to make the decision to reject or approve payments into the system that incited the investigation.
Sasko and his supervisor claimed that it was common knowledge that his brothers worked at Pike Electric.
Although he explained that he did not want to encourage any appearance of corruption, Commissioner J. Michael Ohueri said, “We don’t want to punish people for something that seems really commonsensical and that everyone was aware of.”
Sasko argued that he was not guilty of any violation because “I recused myself from any contract until it was awarded.” The price for any job the contractor completed had already been established in the contract prior to Sasko authorizing payments. “The only thing I do is send it (payments) to purchasing,” he said.
Commissioner Ohueri questioned the city auditor’s office on the grounds of its investigation saying, “Do you not think it could be a little absurd if someone could violate code by completing a contract?”
Weibe explained that this conflict of interest could have easily been resolved if Austin Energy had reassigned Sasko. However, this reassignment could only have been made once Sasko disclosed his conflict of interest in writing.
Sasko said that no one informed him that he needed to officially acknowledge this conflict of interest in writing. “I was not even aware that had to be done,” he told the commission.
According to the commissioners, Austin Energy and Pike Electric should improve their internal processes in order to avoid future mishaps of this nature. “I could argue that a lack of guidance is the equivalent to misguidance,” said Commissioner Ben Stratmann.
The code too came under scrutiny for being difficult to interpret. “This is just bad code,” said Commissioner Luis Soberon.
Commissioner Debra Danburg explained that as someone who helped write the state law that this code is based on, “It’s not the first time I’ve had unintended consequences from my legislation.”
After a vote, the commission unanimously found that Sasko made no violation of the city’s code of ethics.
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Key Players & Topics In This Article
Austin Energy: As a municipally-owned electric utility, Austin Energy is a rarity in the largely deregulated State of Texas. It's annual budget clocks in at over $1 billion. The utility's annual direct transfer of a Council-determined percentage of its revenues offers the city a notable revenue stream.
City of Austin Ethics Review Commission: The Ethics Review Commission is charged with review of, among other issues, ethics complaints leveled against City of Austin boards and commission members. They meet quarterly.
Office of the City Auditor: This city department is created by the city's charter in order to establish and ensure "accountability transparency, and a culture of continuous improvement in city operations."