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Sewickley Township man got food stamps, $206K in gas well royalties, investigators say

| Monday, July 28, 2014, 11:03 p.m.

A Sewickley Township man didn't mention $206,346.29 he collected in natural gas royalties in 2013 when he applied for public assistance, including help with his heating bill, with the state welfare department last year, investigators said.

Now John J. Basista, 50, has been charged with welfare fraud in what may be the first case of its kind.

He allegedly failed to disclose the royalty income he received from Chevron while collecting $1,762 in food stamps, according to an affidavit.

“(Basista) failed to report this income to DPW as required on an application for benefits and an application for low-income heating energy assistance program,” according to the affidavit written by investigator Melanie Sam of the state Office of Inspector General.

“(Basista) also provided statements from himself and his sister that she paid his expenses because he was unable to do so,” it adds.

The alleged violations occurred between April and December 2013.

James Timko, spokesman for the inspector general, said he hasn't heard of any previous welfare fraud charges stemming from gas royalties not declared as income.

“That's not to say it doesn't exist, but I'm not familiar with it,” he said.

Bruce Antkowiak, a St. Vincent College criminal law professor and a former federal prosecutor and defense attorney, said such a case would be new to him.

“The need people face to get welfare payments usually dissipates when you get that kind of payment,” he added.

Both Timko and Sam declined to discuss the investigation, other aspects of the case or possible outcomes.

The application form for public assistance does not list the word “royalties” among examples of possible income, but it's logical that receipt of such money would be income, said welfare department spokeswoman Kait Gillis.

“It's the individual's responsibility to report the income coming into them,” she said.

Basista is a co-owner of the Basista-Demotta gas well on a parcel of land about 200 yards behind Basista's modest, secluded home on Brunazzi Road.

He was willed the 216-acre farm by his mother, Margaret Basista, in 2006, according to a January 2013 lease agreement filed in the Westmoreland County Recorder of Deeds office.

A 2013-14 form for heating assistance lists $17,235 as the income maximum for eligibility for one person and $23,265 for two.

An energy assistance worker with the welfare department referred Basista's case to Sam to confirm his income and household composition, according to the affidavit.

Investigators often learn of potential violations through tips from welfare department workers, Timko said.

Basista entered into the lease agreement with Atlas America LLC in 2009. He was to split 15 percent of all oil and gas production income from the wells.

He assigned portions of his potential 7.5 percent in royalties to others in exchange for money, according to records.

In a brief interview outside his home, Basista said he has been out of work for about seven years because of a medical condition he didn't explain. He said he filed for public assistance when he became incapacitated after working for 30 years.

“I don't get no income,” he said, before an unidentified woman came out of his house and ordered a reporter off the property.

“I did not go to work for none of this money,” he added. “I haven't worked since 2007. So what does a royalty check have to do with food stamps?

“I don't really think it's any of your business,” he added.

Basista said he has a lawyer but refused to name that person. Online court records do not list the name of an attorney who is representing Basista.

Basista said he was unaware of the charges filed against him but said investigators have visited his property.

He is scheduled for a preliminary hearing on Aug. 14.

Bob Stiles is a staff writer for Trib Total Media. He can be reached at 724-836-6622 or bstiles@tribweb.com.

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