JANICA PIERCE TUCKER

614.334.6182
jpierce@taftlaw.com

March 26, 2020

Board of Directors
Southwest Licking Community Water and Sewer District
8675 York Road
Pataskala, OH 43062

Re: Investigative Report

Dear Board Members:

At your request, I conducted an independent, internal investigation regarding a

complaint received by Debra Moore (referred to herein as “Complainant”) directed to the
Southwest Licking Community Water and Sewer District (“SLCWSD”). I have outlined my
findings in this matter below.

BACKGROUND OF THE INVESTIGATOR

Janica Pierce Tucker, Esq.

 Partner, Taft Stettinius & Hollister LLP (Columbus Office)

 18 years’ experience practicing law (10+ years’ experience practicing exclusively

in employment/labor law)

 Prepared and delivered management training in equal employment, and presented

on the topic of conducting internal investigations

 Experienced internal investigator of employment-related issues for both public and

private entities

FACTUAL BACKGROUND AND ANALYSIS

To fully investigate this matter, the investigator conducted interviews of the

Complainant Debra Moore; John Carlisle; Board Members Rob Platte and Larry
Kretzmann (Board Member Charles Hagy was contacted for an interview but declined);
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March 26, 2020
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employees Josephine Carrelli and CJ Gilcher, and former employee Lee Conkel (former
Board Member Mike Fox was contacted for an interview but did not respond). The
investigator also reviewed documents provided.

Overview of SLCWSD

SLCWSD provides centralized water and wastewater services to residential and

commercial customers in Etna Township, Harrison Township, and Lima Township
(currently the City of Pataskala). The Board consists of three members that are appointed
by the respective townships. The current Board Members are Charles Hagy, Rob Platte,
and Larry Kretzmann. SLCWSD employs twenty-two individuals. John Carlisle
(“Mr. Carlisle”) is employed as General Manager. During this investigation, Mr. Carlisle
was placed on paid administrative leave. CJ Gilcher currently serves as Acting General
Manager.

Complaint

The Complainant raised the following issues in her Complaint (See Attachment 1):

Real Estate Acquisition (excerpt from the Complaint)

As you are aware, on October 21st, 2019 the District accepted assignment of real
estate property from Charles Hagy. At the time of the purchase the Board was comprised
of Mike Fox, John Carlisle, and Larry Kretzmann. The very next month on November
15th, 2019, the new Board of Trustees approved an employment contract to hire John
Carlisle as the General Manager (GM) for the District. At that time the board was then
comprised of Mike Fox, Charles Hagy, and Larry Kretzmann.

Job Posting of the General Manager Position (excerpt from the Complaint)

The Board posted to fill the vacancy of the GM position on May 21st, 2019. The
Board received a number of applications in response to that posting, however on July 9th,
2019 Mr. Fox stated that he directed to C-Max to make changes to the job posting to
hopefully receive more resumes. Mr. Fox and Mr. Carlisle both voted yes to accept the
job posting changes. Mr. Kretzmann voted no. When comparing the original job posting
to the revised one, the one notable change was the removal of the minimum requirement
to be a licensed professional engineer in the state of Ohio in which Mr. Carlisle is not.

Timing Issues with the Real Estate Acquisition and Mr. Hagy’s Appointment
(excerpt from the Complaint)

On November 5th, 2019 Mr. Carlisle announced his resignation as the Etna
Township representative to the SWLCWSD Board at the Etna Township Trustees
meeting. At that same meeting, Mr. Hagy was announced as the new Etna Township
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March 26, 2020
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representative to the SWLCWSD Board. This appointment was made without posting to
the public and merely days after an October 21st, 2019 real estate transaction between
the SWLCWSD Board and Mr. Hagy.

Hiring Process and Other Relationships at the District (excerpt from the Complaint)

On November 7th, 2019 SWLCWSD held a special meeting called by Mr. Fox.
(Which was announced and held in less than a 24 hour period) To date no candidates for
GM had been interviewed to my knowledge. At this meeting 3 individuals were to be
interviewed, one being Mr. Carlisle. Later in this meeting, Mr. Hagy motioned to hire
Mr. Carlisle. Mr. Hagy and Mr. Fox both voted yes to hire Mr. Carlisle as the new
GM. Mr. Kretzmann voted no. It must be stated that Mr. Fox’s daughter has been
residing with Mr. Carlisle for approximately 7 years as significant others.

Issues regarding Carlisle’s Employment Agreement (excerpt from the Complaint)

On November 15th, 2019 SWLCWSD held another special meeting. An

employment agreement between Mr. Carlisle and the SWLCWSD was finalized and
agreed upon. Mr. Hagy and Mr. Fox both voting yes. Mr. Kretzmann voted no.

SUMMARY OF FACTS REGARDING THE INVESTIGATION OF THE COMPLAINT

For purposes of this report, I will provide factual information and a summary for
each of the issues raised in the Complaint, the facts derived from the interviews, and
supporting documentation provided during the investigation. As part of the investigation,
I assessed the credibility of the witnesses based on the information shared and received
by others.

A. Real Estate Acquisition

SLCWSD is allowed to purchase property for the services it provides for the District
that may involve placement of additional water lines, construction of a new water plant,
and other tasks that are in line with the mission of SLCWSD.

At the time of the transaction referenced in the Complaint, Mr. Hagy was not a
Board Member for SLCWSD. The District purchased property that Mr. Hagy assigned
any interest and the Board approved the acquisition in October 2019. Mr. Hagy’s wife is
a real estate agent and she assisted in preparation of the documents for the sale. She
communicated with the District on behalf of Mr. Hagy, not Mr. Hagy himself. Based on
the review of the purchase agreement and the information obtained in the interviews, the
District purchased the property for a reasonable value. None of the interviews or the
documents reviewed show any fraudulent activity on behalf of the Board or Mr. Hagy.

Mr. Hagy is known throughout the community. He and Mr. Carlisle are considered
friends. Mr. Hagy expressed interest in being a SLCWSD Board Member before
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Mr. Carlisle was appointed by Etna Township. Mr. Carlisle resigned from the Board in
November 2019 and because of Mr. Hagy’s prior interest, Etna Township appointed him
to fill Mr. Carlisle’s seat. The timing of the events will be discussed below. The evidence
from this investigation does not support a finding that Mr. Hagy’s appointment was directly
related to the real estate acquisition.

B. Job Posting of General Manager Position

The General Manager for SLCWSD is responsible for the daily operations and
activities of the District. Prior to Mr. Carlisle’s hire, Lee Conkel held the position of
General Manager. SLCWSD hired Mr. Conkel on or about June 22, 2016 as General
Manager. Mr. Carlisle, Mr. Kretzmann, and Larry Meade served as Board Members.
Mr. Conkel is an Engineer and has a degree in Civil Engineering. (See Mr. Conkel’s
Employment Agreement attached as Attachment 2) At the time of Mr. Conkel’s
resignation, Mr. Fox replaced Mr. Meade on the Board. Mr. Conkel resigned in April 2019.

Upon Mr. Conkel’s resignation, the Board instructed the District to post the
position. The Board unanimously agreed on the job posting, in part because it mirrored
the job description. (See May 21, 2019 job posting attached as Attachment 3) The
minimum qualifications included, but not limited to, a Bachelor’s Degree in Civil
Engineering with a Professional Engineer’s License in Ohio and a minimum of 7 years of
experience in water and wastewater field; or a high school diploma or equivalent and a
Class III Water Supply License, a Class III Wastewater Worker’s License, and 15 years
of experience in water and wastewater field.

The Board received resumes for the position that met the minimum qualifications
(three resumes were received; two held a professional engineering degree). According to
Mr. Carlisle, none of the candidates were interviewed because the Board Members
agreed they would only interview someone if all of the Board Members agreed to do so.

Because the Board was not satisfied with the applicants, the Board discussed an
amendment to the job posting to eliminate the requirement that the General Manager
have a degree in Civil Engineering with a Professional Engineer’s License or the
certifications. (See July 9, 2019 job posting attached hereto as Attachment 4) Mr. Fox
made a motion to change the job posting and Mr. Carlisle seconded the motion, effectively
removing these requirements. The Board voted 2-1 with Mr. Carlisle and Mr. Fox voting
yes, and Mr. Kretzmann voting no to the change to the job posting.

Of note, with the exception of Mr. Carlisle, the interviewees who served as General
Manager, and are familiar with the duties and responsibilities of the position, believe that
the person should be a Civil Engineer or have the certifications as provided in the May 21,
2019 posting. The approved job description did not change and still includes the
qualifications as provided in the May 21, 2019 job posting. The Board received four
additional resumes in response to the second posting. According to Mr. Carlisle, the
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Board elected not to interview any of the candidates at that time because all of the
members did not agree to do so.

At some point during this process, Mr. Carlisle expressed interest in the General
Manager position. Mr. Carlisle denies telling anyone he was interested in the position
until after he resigned from the Board. He submitted his resume to the District’s office the
next day after his resignation, November 6, 2019. Employees of the District, however,
were aware that Mr. Carlisle wanted the position. He was overheard asking Board
Member Mr. Fox for a copy of Mr. Conkel’s Employment Agreement and inquiring as to
the benefits of the position. He also discouraged Mr. Gilcher from applying for the position
and assured him he could be next after he retired. Mr. Gilcher had an interest in the
position, but did not apply for the position because of Mr. Carlisle’s interest.

Mr. Carlisle’s interest in the position occurred while he was on the Board, not after
his resignation. Mr. Carlisle does not have a civil engineering/engineering degree or any
of the certifications as provided in the May 21, 2019 posting. Mr. Carlisle voted on the
change of the job posting. These changes presented an opportunity for Mr. Carlisle to
apply for the position as he now met the minimum qualifications. Mr. Carlisle has 40+
years of experience as a plumber. He applied based on his plumbing experience, service
on the Board, and the Board’s inability to find a candidate. He felt that the taxpayers were
suffering as long as the position remained unfilled.

C. Timing

Those interviewed, with the exception of Mr. Carlisle, were all suspicious of the
timeline of events that ultimately led to Mr. Carlisle being hired as General Manager.
Mr. Carlisle explained that Etna Township did not have others apply for his replacement
on the Board because Mr. Hagy had previously expressed interest. There is no evidence
to dispute Mr. Carlisle’s interview. (The interviewees believe that Mr. Fox was aware of
Mr. Carlisle’s interest in the position, but Mr. Fox declined to interview.) It is not completely
clear why Etna Township did not inform the public of the vacancy to allow others to apply,
but that is not the subject of this investigation.

On November 6, 2019, Mr. Fox called a special meeting of the Board to be held
on November 7, 2019 at 7 p.m. to interview three potential candidates for the General
Manager position. The interviews were conducted in executive session and Mr. Carlisle
sat in executive session during the entire time. Mr. Carlisle was interviewed by the Board
in executive session, but the other two applicants were available by phone. Mr. Carlisle
was present in executive session during deliberations.

After the Board came out of executive session, a discussion was held regarding
hiring Mr. Carlisle as General Manager. During the discussion, both Mr. Fox and Mr. Hagy
voiced their support for Mr. Carlisle. Mr. Fox also sought legal counsel as to whether it
was a conflict of interest for Mr. Carlisle to obtain the General Manager’s position based
on Mr. Fox and Mr. Carlisle’s personal relationship, and Mr. Carlisle’s intimate relationship
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with Mr. Fox’s daughter. Mr. John Albers, counsel to the Board, advised that he did not
believe it was a conflict. As such, Mr. Hagy motioned to hire Mr. Carlisle as General
Manager. The motion was seconded by Mr. Fox. During the discussion of the motion,
Mr. Kretzmann stated that he would prefer a decision from the Ohio Ethics Commission
prior to hiring Mr. Carlisle. Mr. Fox agreed to do so. Mr. Hagy amended the motion to
hire Mr. Carlisle contingent on the response from the Ohio Ethics Commission, as well as
final negotiation of an employment agreement. Mr. Fox and Mr. Hagy voted yes on the
amended motion and Mr. Kretzmann voted no. Mr. Carlisle was hired on this date as
General Manager. While Mr. Fox did not submit to an interview, he made comments in
the Newark Advocate that referenced a 2015 Ohio Ethics Commission Opinion. (A copy
of the November 8, 2019 email with the referenced opinion is attached hereto as
Attachment 5)

The sequence of events suggests that Mr. Carlisle expressed interest in the
position of General Manager before he resigned from the Board. He voted on the change
to the job posting while he was on the Board. The change to the job posting availed
himself of the opportunity to apply for the position.

D. Hiring Process

I have discussed the hiring process above. As it relates to the relationship between
Mr. Carlisle and Mr. Fox’s daughter, the evidence does not support that Mr. Fox voted in
favor of Mr. Carlisle because of the relationship. It is clear that Mr. Fox and Mr. Carlisle
are friends, but so is Mr. Carlisle and Mr. Hagy. While the evidence suggests that Mr. Fox
knew of Mr. Carlisle’s interest in the position when both sat on the Board, the evidence
does not support that the relationship between Mr. Carlisle and Mr. Fox’s daughter
influenced Mr. Fox’s decision. Mr. Fox emailed the Ohio Ethics Commission. The Ohio
Ethics Commission did not provide an opinion as to the specific facts presented by
Mr. Fox, but instead sent a 2015 Advisory Opinion that was intended to provide Mr. Fox
with general information regarding Ohio Ethics Law. The Advisory Opinion and the facts
stated therein are not similar to the issues Mr. Kretzmann raised regarding the
relationship between Mr. Carlisle and Mr. Fox. (Attachment 5)

E. Employment Agreement

Mr. Carlisle acknowledged that he had a copy of Mr. Conkel’s Employment

Agreement. He kept a copy of the agreement when the Board voted in favor of it.
Mr. Carlisle negotiated with the Board the terms of the Employment Agreement. The
Board hired outside counsel to draft the Employment Agreement. The comments provided
on the agreement were given to the investigator. The Board did not adopt any of outside
counsel’s recommendations despite being told that some of the provisions were not in the
best interests of the Board. Outside counsel expressed concern to the Board regarding
the terms of the Employment Agreement as presented. The Board rejected such
concerns. Outside counsel terminated her relationship with the Board before the
agreement was finalized because of a conflict of interest. The Board did not retain any
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additional outside counsel through the remainder of the process to finalize Mr. Carlisle’s
employment agreement. (A copy of Mr. Carlisle’s Employment Agreement is attached
hereto as Attachment 6)

FINDINGS

I interviewed seven people that included board members, employees, former

employees, and the Complainant. Despite numerous attempts by emails and telephone
messages, Charles Hagy and Mike Fox declined or was otherwise unresponsive. It took
some time in terms of scheduling and availability, but I eventually interviewed Mr. Carlisle.
He is represented by counsel, Jonathan Downes. Mr. Carlisle did not identify any
additional individuals for me to interview based on the questions presented. The
Complainant raised issues regarding Mr. Carlisle’s employment; the legality of his current
Employment Agreement; the process for hiring of the General Manager position; and the
District’s purchase of land from Mr. Hagy.

Based on the interviews and the documents I have received to date, the following
are my findings:

The assignment of the property from Mr. Hagy was done through his wife, a realtor,
and Mr. Hagy was not a Board Member at the time of the transaction. Before becoming
a Board Member, Mr. Hagy disclosed the transaction. It does not appear that he used
his position or influence for gain or for an unfair advantage in the transfer of the property.

The Ohio Ethics Law prohibits a public official from knowingly authorizing or
employing his authority or influence to secure authorization of a public contract in which
he has an interest. RC 2921.42(A)(1). As discussed below, Mr. Carlisle likely violated
R.C. 2921.42(A)(1) by knowingly using his authority as a board member to secure his
employment under this contract.

Any such public contract is a violation of the Ohio Ethics Law and is automatically
void and unenforceable. R.C. 2921.42(H). Therefore, Mr. Carlisle’s employment contract,
which is a public contract, is likely void and unenforceable as a matter of law. The Board
must adhere to Ohio law and the process to void the contract if the Board chooses to
terminate Mr. Carlisle. The following points are facts the Board should consider in its
decision:

 Mr. Carlisle voted to approve the initial posting of the General Manager position
on May 21, 2019, including the specific job qualifications and related aspects
of the position.

 Mr. Fox, whose daughter lives with and is the long-term partner of Mr. Carlisle,
recommended changes to the job posting that removed the engineering
requirements. He may have only recommended these changes so that
Mr. Carlisle could apply. This suggests that Mr. Carlisle had some amount of
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influence over Mr. Fox, either directly or possibly indirectly through his
daughter’s relationship with Mr. Carlisle. At the very least, it is evident that a
current Board Member had an interest in the terms of the employment and in
ensuring that Mr. Carlisle was hired. Both Mr. Carlisle and Mr. Fox voted to
approve the revised job posting on July 9, 2019.

 Mr. Carlisle resigned from the Board on November 5, 2019. The very next day,
he submitted his resume for the General Manager position.

 On November 7, 2019, the Board held a public meeting and interviewed three
potential candidates in executive session. Mr. Carlisle was the only other
attendee at this meeting.

 Even after his resignation as a Board Member, Mr. Carlisle attended special
meetings and made public comments that concerned matters of the Board
Members, not the public. During the November 15, 2019 special meeting,
Mr. Carlisle stated that he would like to schedule a future special meeting to
address certain issues.

 The final employment contract has hand-written additions and revisions that
are more favorable to Mr. Carlisle (increased sick days, increased salary). It is
unclear whose handwriting it is and who made these changes. Mr. Carlisle
believes the notes were written by Mr. Fox.

 The one-sided nature of the terms governing termination of Mr. Carlisle’s

employment are not in the Board’s best interest. He is guaranteed a full salary
and benefits for the entire four-year term of the contract, unless his employment
is terminated under the narrow terms of Section 8(A) which provides three
situations that are either unfavorable to the Board or are out of the Board’s
control.

Although “[t]he law does not prohibit a former board member from competing for
an employment position with the public agency he formerly served in an open and fair
employment process if it is clear that he did not use his position, while on the board, to
secure the job, and that the best and most qualified candidate is selected for the job”, this
was clearly not an open and fair employment process. (See Ohio Ethics Commission
Information Sheet #6 attached as Attachment 7)

The Ohio Ethics Commission explicitly provides for situations where a board
member resigns prior to the actual authorization of the subsequent employment by the
board. “If a board member wants to apply for an open job with the board, he must resign
from the board before he submits an application or takes any other action to secure the
job or benefits related to holding the job. He must resign before he discusses the
employment opportunity with any board members or board employees. He is prohibited
from seeking the job while he is a board member, and then resigning to accept the
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employment.” Ohio Ethics Commission Information Sheet #6. This Information Sheet was
created as a general guide and governs all ethics situations. The Board may elect to use
this information sheet to assist in its deliberations and ultimate decision.

RECOMMENDATIONS

Based on the findings, the Board will need to consider whether Mr. Carlisle
inappropriately interfered with the process in the District’s desire to hire a General
Manager. The Board will also need to consider the validity of some of the provisions of
Mr. Carlisle’s Employment Agreement. The investigator recommends that that the Board
rely on this report and the information contained herein to reach its conclusions as it
relates to the issues raised in the Complaint and the future of Mr. Carlisle’s employment.

Sincerely,

/s/ Janica Pierce Tucker

Janica Pierce Tucker

JPT/smk

Attachments 1-7
26932719.9