An outside review of a suspected ethics violation in the city of Snoqualmie has been completed and the hearing officer conducting the review has recommended disciplinary action.

Ethics Hearing Officer Grant Degginger, hired by the city in December to investigate suspected ethics violations related to a business partnership between former events contractor Leslie (Lizzy) Billington and her former supervisor, Parks and Public Works Director Dan Marcinko, submitted his report and recommendations to the city March 2.

In the report, Degginger indicated that Marcinko had violated section 2.80.030.1.A of the city’s ethics code and recommended to the city administration that he be subject to disciplinary action.

That section of the municipal code specifically states that no city officer or employee shall “engage in any transaction or activity, which is, or would to a reasonable person appear to be, in conflict with or incompatible with the proper discharge of official duties, or which impairs, or would to a reasonable person appear to impair, the officer’s or employee’s independence of judgment or action in the performance of official duties and fail to disqualify himself or herself from official action in those instances where the conflict occurs.”

Degginger was contracted to investigate the possible violation of the city’s ethics code by Marcinko and Billington, as well as whether the city had been billed for, and paid for, work not performed by Billington.

A formal ethics violation complaint against Marcinko was filed by Snoqualmie citizen Brian Jacobsen on Dec. 18.

The question about an ethics violation was raised at the Oct. 23, 2017, city council meeting. In addition to the discovery that Billington had been filing early invoices for several months and getting paid for work she had not yet completed, it was also brought to the city’s attention that Billington was involved in an outside business with Marcinko, who was her contract supervisor.

In the “Findings of Fact” section of his report, Degginger described the series of events that led to his determination. The report states that while Marcinko knew Billington before she began as a consultant for the city in 2015, he didn’t have an active role in the negotiation of the contract. Her initial contract split her efforts between economic development supervised by Community Development Director Mark Hofman as well as events coordination activities supervised by Marcinko.

In 2016, the report states, Billington spent more time on the community events portion of her consultant work which led to Hofman recommending that her contract be discontinued into 2017 unless it solely focused on events. The contract was renewed with all requests for payment to be submitted to Marcinko, the Director of Parks and Public Works. He reviewed and approved Billington’s monthly invoices along with City Administrator Bob Larson.

During this contract work in 2015 and 2016, attorney Matthew Mattson reportedly approached both Billington and Marcinko separately, about starting a wine and liquor distribution business specifically targeted toward “Indian casinos and hospitality facilities.” Pacific Northwest Wines and Spirits LLC was created in February 2016 with Mattson, Marcinko and Billington as members.

Degginger found that each of the three would own one-third of the business. Billington did not make a cash investment but offered to do promotional and operations work and Marcinko had invested $25,000 to get one-third interest in the new business. The report states some time in 2016, both Marcinko and Billington knew the other was involved in the business.

“According to Mr. Mattson, by approximately mid-2016 both Ms. Billington and Mr. Marcinko knew that each was involved in the business,” Degginger wrote. “Mr. Mattson provided both Ms. Billington and Mr. Marcinko with documents regarding the formation and operation of the business.”

The report notes that Marcinko said he didn’t know Billington was involved until February or March 2017, when he overheard her on a phone call with Mattson.

“However, Mr. Mattson’s statements and the entity’s corporate documents indicate that Mr. Marcinko knew, or reasonably should have known, of Ms. Billington’s involvement with the business in late February 2016,” Degginer wrote.

The report goes on to explain that Marcinko “stated he realized that it was wrong for him to be supervising someone who was involved in a business that he was an investor in; however, he thought that Ms. Billington’s contract would not be renewed at the end of the year (2017) and that therefore the situation would, in his words, ‘self-correct.’”

Degginger found that Marcinko never informed his supervisor, Bob Larson, that he was involved in the ownership of a business with a contractor who directly reported to him. Throughout 2016 and 2017, he worked with Billington and approved her invoices.

In the investigation, no evidence was found that any city money or business was used in the wine business.

The “Findings of Fact” section concludes by stating that Marcinko admitted that he knew his work with Billington “presented an appearance of a conflict of interest,” and that he should have notified his employer and stopped working with the contractor.

Degginger concluded that Marcinko had violated the city ethics code and that, according to municipal code, disciplinary action will be taken by the “appropriate city authority.”

He also stated that there was no evidence of any benefit to the business at the expense of the city, that Marcinko had no direct or indirect benefit in Billington’s contract, and that the contracted services the city had paid for were performed.

Snoqualmie Public Information Officer Joan Pliego said the findings are being considered by Mayor Matt Larson and the administration and that no decisions or announcements based on these findings will be made this week.