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District seeks to recover funds

| Tuesday, Oct. 16, 2007

Southmoreland School District has filed suit in Westmoreland County Court of Common Pleas against a former maintenance and grounds supervisor and the company he bought cleaning supplies from for failing to follow a mandatory bid process and over-ordering unneeded supplies at inflated prices.

More than a year ago, Earl G. Cramer Jr., former maintenance and grounds supervisor for the district, resigned from his position.

Soon after, the Everson resident filed a lawsuit with the Fayette County courts stating that the district should provide him with retirement benefits. The district challenged that issue.

Then, about four months ago, General Products and Supply Inc., owned by Eugene Ciafre of Murrysville, filed a suit against the district, claiming the district did not pay for materials that had been shipped there.

The suit was heard before Magisterial District Judge J. Bruce King of Scottdale, who ruled in favor of Southmoreland. That suit is in the appeals process.

Now the district is filing a suit of its own.

In the civil complaint filed in the prothonotary's office on Oct. 5, the district named as defendants: Cramer, General Products and Supply Inc., Commercial Solutions Company, KUDU Associates Inc. and G.P. Industries Inc., which are all owned by Ciafre. Ciafre is also named as a defendant.

Another defendant, Anthony M. Lizza of Scottdale, who won a place on the ballot in the upcoming general election for Southmoreland School Board, is a sales associate for the Ciafre companies.

The three counts of the civil action are: breach of fiduciary duty and aiding and abetting breach of fiduciary duty and conspiracy to breach fiduciary duty; violation of the Pennsylvania anti-bid-rigging act; and violation of civil RICO.

The complaint alleges that while employed by the district on or about March 1, 2003, and continuing through Dec. 13, 2005, Lizza solicited sales through Cramer on behalf of the Ciafre companies.

Also, the complaint states that Cramer agreed to supply a purchase order number to Lizza on behalf of the Ciafre companies and began purchasing supplies from the Ciafre companies on behalf of the district without going through the bidding process, which is required for purchases over $10,000, and also failed to get phone quotes on items purchased at a cost of $4,000 to $10,000.

The complaint also alleges that Ciafre, Cramer and Lizza conspired to determine which of Ciafre's companies would submit an invoice with any given purchase, and the sales of supplies were alternated between and among the Ciafre companies to avoid bidding or quotes for purchases.

The complaint contends that those acts cost the district, and ultimately the taxpayers, more money for supplies than it should have.

One of six examples listed in the complaint included the purchase of 5 gallons of Prep-A-Floor for Floor Seal at a cost of $137.50 from General Products and Supply Inc. on May 12, 2003. The same product could have been purchased from Fagan Sanitary Supply for a cost of $88.90.

The complaint states that Cramer made purchases on behalf of the district for items from General Products and Supply Inc. that were not needed.

One example listed was the purchase of eight 55-gallon drums of Active Live Bacterial Enzymes at a cost of $9,438 and nine 55-gallon drums of primary coagulant for raw waste treatment at a cost of $7,895.25 for the new sewage treatment plant even though the district had large quantities of the products still on hand from previous years.

The district is seeking in excess of $30,000 for the unnecessary purchase of supplies, and wants to recover all of Cramer's wages and costs of benefits provided for allegedly failing to act in good faith. The suit lists a total of $221,621.50 in wages and benefits.

Other damages the district hopes to recover include attorney fees, prejudgment and postjudgment interest and other costs associated with the suit.

Connellsville attorney Richard Bower, who represents Cramer, said, "There is no reason to comment. It's litigated and it should not be played out in the newspaper."

While Lizza did not comment on the suit itself, he did question the timing.

"Two weeks before the primary election (in which he is a candidate for school board), the school board called a special meeting to announce their intentions to sue," he said. "Now, just three to four weeks before the general election, they file the complaint. I think this is simply politics. I think they're trying to influence the outcome of an election."

Messages were left for Cramer and attorney Dwayne Ross of Latrobe, attorney for Ciafre and his companies.

Westmoreland County District Attorney John Peck said his detectives investigated the allegations some time ago but did not have enough evidence to file criminal charges.

"I know there was an investigation," Peck said. "Obviously, no charges were filed."

This isn't the first time that one of Ciafre's businesses has been involved in controversy over bidding procedures.

Ciafre, who is a member of the board of trustees at Westmoreland County Community College, sold $250,000 worth of supplies from 1991 to 1995 to Westmoreland Manor while Lizza was working both for Ciafre and at the Manor as director of maintenance.

In 1995, the county paid him an additional $73,000 without having his company submit a formal bid.

Tribune-Review Reporter Richard Gazarik contributed to this story.

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