The County Tire Contract Controversy ..... Part II: Presiding Commissioner Ron Jost's Actions - Unwise, Unethical or Illegal?

Published by Dick Schaefer, Contributing Writer and Part-time Investigative Reporter

A number of concerned citizens of Gasconade County believe that certain voting positions taken by Presiding Commissioner Ron Jost relative to the county's tire and tire services contract at last Thursday's Commissioners' Meeting in Owensville are unwise and unethical and  perhaps even illegal.  However, others will tell you that they were NOT.  They will tell you that Jost's voting actions were NOT unwise, unethical or illegal.  These citizens and Jost himself claim that the accusations against Jost are politically motivated.

Hermann Hearsay set out to investigate.  Hermann Hearsay set out to find the truth.  This is the second part of four-part series on the subject of "The County Tire Contract Controversy".

During the 7/1 County Commissioners' Meeting held at the Owensville City Hall, Presiding Commissioner Ron Jost of Owensville seconded a motion pertaining to the county's purchase of tires and related tire services which was proffered by Southern District Associate Commissioner Jerry Lairmore, also of Owensville.  Presiding Commissioner Jost tried several times to encourage Northern District Associate Commissioner Matt Penning of Hermann to second Lairmore's motion, but Penning repeatedly refused to do so.  In past years, Jost abstained from voting on the acceptance and rejection of tire and tire services bids, because of his relationship to one of the competing tire vendors, Jost Tire Comapany, now owned by Don Jost, his brother.  This time, however, Jost was much more involved in the discussion and he ultimately DID VOTE.  Lairmore proposed that Gasconade County move away from the open and competitive bidding process it has used for years and years to purchase tires and related tire services as well as many other materials, supplies, equipment and services.  Penning took the position that to do so would be wrong and not in the best interest of county taxpayers.  Earlier that same morning, Lairmore had proposed his new county tire and tire services procedures during the Road and Bridge Department Meeting at the Drake Maintenance Shed where Penning also passionately voiced his objections.  Predictably, Penning objected in the open and public session of the County Commissioners' Meeting, stating clearly his completely logical reasons for opposing Lairmore's motion.  When the motion came to a final vote, both Jost and Lairmore voted in favor of the motion while Penning withheld his vote!

A little background information ...... The 7 a.m. Road and Bridge Department Meeting precedes the open and public County Commission Meeting which is held at 8:30 a.m. every Thursday.  County Clerk Lesa Lietzow does not attend these 7 a.m. meetings and there is continuing controversy as to whether or not she should attend.  Ron Jost reports a "summary" of the Road and Bridge Department meeting during the County Commission Meeting, and Lietzow uses his account in her official County Commission Meeting Minutes which are reported publicly in the newspapers.  It has been unclear to many people we have interviewed as to whether the 7 a.m. Road and Bridge Department Meeting is in fact open to the press and to the public.  Now we have Jeff Noedel of CNL asserting that the 7 a.m. meeting in Drake IS open to the press and to the public.  (Damned inconvenient time and location for the press and public, wouldn't you say?!!!)  Mr. Noedel has ostensibly transcribed the discussions which occurred during the 7/1 Road and Bridge Department Meeting and has published his account on his "news" website ...... but the transcribed account is available for reading exclusively ONLY by his PAID subscribers.  Have we actually devolved to such a sad state of affairs in Gasconade County that we have our county meetings at an inconvenient time for the press and public and at an inconvenient location many miles from the county's two most populous cities?  Have we devolved to such a sad state of affairs that we are going to rely upom CNL's transcriptions of the meeting discussions which are available only to their paid subscribers?  Brought to you by Commissioners Jost and Lairmore ...... the 7 a.m. Thursday Road and Bridge Department Meeting in Drake, MO ..... with no County Clerk present to record official meeting minutes ..... and with "Cheap News LIVE" transcribing the official business discussions of the county ..... but ONLY for the exclusive use of their own paid subscribers!  Now, that's what I call "good county government"! 

But I digress!  That's another pathetic story for another time!  Back to Jost's potential "conflict of interest" and the failure by both Jost and Lairmore to follow the county purchasing procedures mandated by state law.

The Material Facts (as I currently understand and have been able to verify them):

1. Don Jost of Owensville owns and operates Jost Tire Company.  As an incorporated business within the State of Missouri, this fact is verifiable through the Missouri Secretary of State's Office.
2. Presiding Commissioner Ron Jost is known to be Don Jost's brother.
3. Presiding Commissioner Ron Jost claims to have sold his interest in Jost Tire Company, but he still works part-time delivering tires for the company.  We are still working to confirm that Presiding Commissioner Ron Jost has no remaining "ownership interest" in Jost Tire Company.  (Note: This is a very important legal point.  If Ron Jost still retains a 10% ownership interest in his brother's company, an additional point of law comes into play.)
4. Jost Tire Company was the county's primary tire and tire services vendor for many years prior to this past contract year (7/1/2009 - 7/1/2010). 
5. Jost Tire Company lost the county tire and tire services contract when it was awarded to Central Tire Company as the result of the county's  competitive bidding process in July of 2009. 
6. Central Tire Company underbid the state "bid prices" then in effect by an average of 2%.  In addition, Central Tire Company paid back "tire casing credits" to the county during the time it has held the contract, something which Jost Tire Company never did during the many years it held the county contract.  The "tire casing credits" paid back to the county between 7/1/2009 and 7/1/2010 by Central Tire Company totalled $300.00.  (NOTE:  This $ amount is surprisingly low, but my understanding is that NO road grader tires were replaced during this period of time.  This is interesting because numerous road grader tires were replaced during the previous four years when Jost Tire Company held the county contract.  Yes, this is strange!  I will have to investigate and report back to you at a late date!)
7. Central Tire Company is owned and operated by Chuck Lewis, also of Owensville.
8. The tire and tires services purchasing procedures voted into effect by Jerry Lairmore and Ron Jost at the 7/1 County Commission Meeting will have the resultant direct effect of prohibiting Central Tire Company (or any other local tire vendor) from competitively bidding on the county's tire and tire services business and potentially winning 100% of the business as the consequence of being the "low bidder".  The new tire purchasing procedure will place the authority for tire and tire services purchasing decisions into the hands of Wayne Kottwitz, the Road and Bridge Department Superintendent.  According to Jost and Lairmore, Mr. Kottwitz will be "instructed to split the business between the county's tire vendors who agree to sell tires listed on the state's "bid pricing" list.
9. The state's "bid pricing" list does not include all the "odd tire sizes" which Gasconade County uses on its vehicles and equipment.  The state's "bid pricing" list does not include labor rates for changing tires, mounting tires and other labor services which the county purchases through its tire vendors.  The state's "bid pricing" list does not include pricing for other supplies, equipment and parts which are purchased through the tire vendors, batteries being just one such example. 
10. In economic tough times such as we currently face, a tire vendor who is allowed to competitively bid on 100% of the county's tire and tire service business may very well "sharpen his pencil" and bid prices that are LESS than the state's "bid pricing".  This was clearly shown to be the case last year when Central Tire Company won the contract by bidding less than the state's "bid pricing".  IF the county doesn't bid out the tire and tire service business, the county foregoes the real possiblity and opportunity that it could get some very competitive pricing on a significant expense element in its annual operating budget!  At a time when county employees have already been asked to forego pay increases and when their benefits have been cut, the county cannot afford to pass up any cost savings opportunities!
11. The Gasconade County Road and Bridge Department's expenditures for tires and tire services is significant and well exceeds the $4500 per annum threshold which the state has set for competitive bidding.  Road and Bridge Department tire and tire services expenditures during  prior years have been as follows:  $25,193.68 (2006), $21,580.33 (2007), $29,231.26 (2008) and $17,036.08 (2009 thru 7/25).  NOTE:  These dollar amounts were obtained by adding up acutal paid invoices provided by Clerk Lietzow and they DO NOT include expenditures by the Gasconade County Sheriff's Department for tire and tire services.  My understanding is that the Sheriff's Department has been purchasing and currently purchases tires and tire services from Dud's Tire Shop in Owensville.  According to Ron Jost and Jerry Lairmore, these tires are purchased by the county at state "bid list" pricing.  I do not have information regarding labor rates, battery prices and other services provided by Dud's.   I do know that these purchases are NOT competitively bid, although (in this writer's opinon) they probably should be bid out together with the Road and Bridge Department purchases.  Presumably by combining all of this county tire and tire services business together, the county would have the opportunity to attract a bid for competitive pricing lower than state "bid list" pricing.  Dud's Tire Shop is owned and operated by Jim Lairmore who is the brother of Southern District Associate Commissioner Jerry Lairmore.  But once again I digress.  This is yet another matter for another time.

Missouri State Laws (Chapters and Sections of RSMo which seem to apply or which may apply)*:

* Please note that the writer of this article is not an attorney.  Determination of which statutes may or may not apply and which statutes may or may not have been violated in this case ultimately rests with the Missouri Ethics Commission and the Missouri Attorney General's Office. 

RSMo 50.650:  Liability of certain officers.

The accounting officer is personally liable on his bond for the amount of any obligation incurred by his erroneous certification as to the sufficiency of an appropriation or of a cash balance, or for any warrant drawn when there is not a sufficient amount unencumbered in the appropriation or a sufficient unencumbered cash balance in the fund to pay the warrant, or for the payment of any amount not legally owed by the county. Any officer purchasing any supplies, materials or equipment is liable personally and on his bond for the amount of any obligation he incurs against the county without first securing the proper certificate from the accounting officer. The other officers, as the county commission requires, shall each give surety bond in an amount fixed by order of the county commission for the faithful performance of his duties and for a correct accounting for all moneys and other property in his custody. The sufficiency of the sureties shall be approved by the county commission. Any premium on the bonds shall be paid by the county.

(RSMo 1939 § 10933, A.L. 1945 p. 603, A.L. 1959 S.B. 64)

RSMo 50.660:  Rules governing contracts.

1. All contracts shall be executed in the name of the county, or in the name of a township in a county with a township form of government, by the head of the department or officer concerned, except contracts for the purchase of supplies, materials, equipment or services other than personal made by the officer in charge of purchasing in any county or township having the officer. No contract or order imposing any financial obligation on the county or township is binding on the county or township unless it is in writing and unless there is a balance otherwise unencumbered to the credit of the appropriation to which it is to be charged and a cash balance otherwise unencumbered in the treasury to the credit of the fund from which payment is to be made, each sufficient to meet the obligation incurred and unless the contract or order bears the certification of the accounting officer so stating; except that in case of any contract for public works or buildings to be paid for from bond funds or from taxes levied for the purpose it is sufficient for the accounting officer to certify that the bonds or taxes have been authorized by vote of the people and that there is a sufficient unencumbered amount of the bonds yet to be sold or of the taxes levied and yet to be collected to meet the obligation in case there is not a sufficient unencumbered cash balance in the treasury. All contracts and purchases shall be let to the lowest and best bidder after due opportunity for competition, including advertising the proposed letting in a newspaper in the county or township with a circulation of at least five hundred copies per issue, if there is one, except that the advertising is not required in case of contracts or purchases involving an expenditure of less than six thousand dollars. It is not necessary to obtain bids on any purchase in the amount of four thousand five hundred dollars or less made from any one person, firm or corporation during any period of ninety days. All bids for any contract or purchase may be rejected and new bids advertised for. Contracts which provide that the person contracting with the county or township shall, during the term of the contract, furnish to the county or township at the price therein specified the supplies, materials, equipment or services other than personal therein described, in the quantities required, and from time to time as ordered by the officer in charge of purchasing during the term of the contract, need not bear the certification of the accounting officer, as herein provided; but all orders for supplies, materials, equipment or services other than personal shall bear the certification. In case of such contract, no financial obligation accrues against the county or township until the supplies, materials, equipment or services other than personal are so ordered and the certificate furnished.

2. Notwithstanding the provisions of subsection 1 of this section to the contrary, advertising shall not be required in any county in the case of contracts or purchases involving an expenditure of less than six thousand dollars.

(RSMo 1939 § 10932, A.L. 1945 p. 603, A.L. 1957 p. 327, A.L. 1959 S.B. 64, A.L. 1982 S.B. 691, A.L. 1995 H.B. 622, A.L. 1998 S.B. 917, A.L. 1999 S.B. 220, A.L. 2007 S.B. 22)

RSMo 50.780:  Commissions may permit officers to purchase supplies direct--liability therefor--preference in bids--waiver, when (second class and certain first class counties).

1. It shall hereafter be unlawful for any county or township officer in any county to which sections 50.760 to 50.790 apply to purchase any supplies not contracted for as provided in sections 50.760 to 50.790 for the officer's official use and for which payment is by law required to be made by the county unless the officer shall first apply to and obtain from the county commission an order in writing and under the official seal of the commission for the purchase of such supplies, and in all cases where the supplies requested by such officer have been contracted for by the county commission as provided in sections 50.760 to 50.790, the order shall be in the form of a requisition by said officer addressed to the person, firm, company or corporation with whom or which the county commission has made a contract for such supplies, and presented to the county commission for approval or disapproval; and unless approval be given such requisition shall not be filled and any such requisition filled without such approval shall not be paid for out of county funds. The county shall not be liable for any debts for supplies except debts contracted as provided in sections 50.760 to 50.790. The best price and the quality of supplies shall be considered and supplies of a higher price or quality than is reasonably required for the purposes to which they are to be applied shall not be purchased or contracted for. Preference to merchants and dealers within their counties may be given by such commissioners, provided the price offered is not above that offered elsewhere.

2. The county commission may waive the requirement of competitive bids or proposals for supplies when the county commission has determined that there exists a threat to life, property, public health, or public safety or when immediate expenditure is necessary for repairs to county property in order to protect against further loss of, or damage to, county property, to prevent or minimize serious disruption in county services or to ensure the integrity of county records. Emergency procurements shall be made with as much competition as is practicable under the circumstances. After an emergency procurement is made by the county commission, the nature of the emergency and the vote approving the procurement shall be noted in the minutes of the next regularly scheduled meeting.

(RSMo 1939 § 2515, A.L. 2005 H.B. 58)  

RSMo 50.783:  Waiver of competitive bid requirements, when--rescission of waiver, when--single feasible source purchases.

1. The county commission may waive the requirement of competitive bids or proposals for supplies when the commission has determined in writing and entered into the commission minutes that there is only a single feasible source for the supplies. Immediately upon discovering that other feasible sources exist, the commission shall rescind the waiver and proceed to procure the supplies through the competitive processes as described in this chapter. A single feasible source exists when:

(1) Supplies are proprietary and only available from the manufacturer or a single distributor; or

(2) Based on past procurement experience, it is determined that only one distributor services the region in which the supplies are needed; or

(3) Supplies are available at a discount from a single distributor for a limited period of time.

2. On any single feasible source purchase where the estimated expenditure is three thousand dollars or over, the commission shall post notice of the proposed purchase. Where the estimated expenditure is five thousand dollars or over, the commission shall also advertise the commission's intent to make such purchase in at least one daily and one weekly newspaper of general circulation in such places as are most likely to reach prospective bidders or offerors and may provide such information through an electronic medium available to the general public at least ten days before the contract is to be let.

(L. 2005 H.B. 58)

RSMo 105.452:  Prohibited acts by elected and appointed public officials and employees.

1. No elected or appointed official or employee of the state or any political subdivision thereof shall:

(1) Act or refrain from acting in any capacity in which he is lawfully empowered to act as such an official or employee by reason of any payment, offer to pay, promise to pay, or receipt of anything of actual pecuniary value paid or payable, or received or receivable, to himself or any third person, including any gift or campaign contribution, made or received in relationship to or as a condition of the performance of an official act, other than compensation to be paid by the state or political subdivision; or

(2) Use confidential information obtained in the course of or by reason of his employment or official capacity in any manner with intent to result in financial gain for himself, his spouse, his dependent child in his custody, or any business with which he is associated;

(3) Disclose confidential information obtained in the course of or by reason of his employment or official capacity in any manner with intent to result in financial gain for himself or any other person;

(4) Favorably act on any matter that is so specifically designed so as to provide a special monetary benefit to such official or his spouse or dependent children, including but not limited to increases in retirement benefits, whether received from the state of Missouri or any third party by reason of such act. For the purposes of this subdivision, "special monetary benefit" means being materially affected in a substantially different manner or degree than the manner or degree in which the public in general will be affected or, if the matter affects only a special class of persons, then affected in a substantially different manner or degree than the manner or degree in which such class will be affected. In all such matters such officials must recuse themselves from acting, except that such official may act on increases in compensation subject to the restrictions of section 13 of article VII of the Missouri Constitution; or

(5) Use his decision-making authority for the purpose of obtaining a financial gain which materially enriches himself, his spouse or dependent children by acting or refraining from acting for the purpose of coercing or extorting from another anything of actual pecuniary value.

2. No elected or appointed official or employee of any political subdivision shall offer, promote, or advocate for a political appointment in exchange for anything of value to any political subdivision.

(L. 1978 H.B. 1610 § 3, A.L. 1990 H.B. 948, A.L. 1991 S.B. 262, A.L. 2008 H.B. 2233)

RSMo 105.454:  Additional prohibited acts by certain elected and appointed public officials and employees, exceptions.

No elected or appointed official or employee of the state or any political subdivision thereof, serving in an executive or administrative capacity, shall:

(1) Perform any service for any agency of the state, or for any political subdivision thereof in which he or she is an officer or employee or over which he or she has supervisory power for receipt or payment of any compensation, other than of the compensation provided for the performance of his or her official duties, in excess of five hundred dollars per transaction or five thousand dollars per annum, except on transactions made pursuant to an award on a contract let or sale made after public notice and competitive bidding, provided that the bid or offer is the lowest received;

(2) Sell, rent or lease any property to any agency of the state, or to any political subdivision thereof in which he or she is an officer or employee or over which he or she has supervisory power and received consideration therefor in excess of five hundred dollars per transaction or five thousand dollars per year, unless the transaction is made pursuant to an award on a contract let or sale made after public notice and in the case of property other than real property, competitive bidding, provided that the bid or offer accepted is the lowest received;

(3) Participate in any matter, directly or indirectly, in which he or she attempts to influence any decision of any agency of the state, or political subdivision thereof in which he or she is an officer or employee or over which he or she has supervisory power, when he or she knows the result of such decision may be the acceptance of the performance of a service or the sale, rental, or lease of any property to that agency for consideration in excess of five hundred dollars' value per transaction or five thousand dollars' value per annum to him or her, to his or her spouse, to a dependent child in his or her custody or to any business with which he or she is associated unless the transaction is made pursuant to an award on a contract let or sale made after public notice and in the case of property other than real property, competitive bidding, provided that the bid or offer accepted is the lowest received;

(4) Perform any services during the time of his or her office or employment for any consideration from any person, firm or corporation, other than the compensation provided for the performance of his or her official duties, by which service he or she attempts to influence a decision of any agency of the state, or of any political subdivision in which he or she is an officer or employee or over which he or she has supervisory power;

(5) Perform any service for consideration, during one year after termination of his or her office or employment, by which performance he or she attempts to influence a decision of any agency of the state, or a decision of any political subdivision in which he or she was an officer or employee or over which he or she had supervisory power, except that this provision shall not be construed to prohibit any person from performing such service and receiving compensation therefor, in any adversary proceeding or in the preparation or filing of any public document or to prohibit an employee of the executive department from being employed by any other department, division or agency of the executive branch of state government. For purposes of this subdivision, within ninety days after assuming office, the governor shall by executive order designate those members of his or her staff who have supervisory authority over each department, division or agency of state government for purposes of application of this subdivision. The executive order shall be amended within ninety days of any change in the supervisory assignments of the governor's staff. The governor shall designate not less than three staff members pursuant to this subdivision;

(6) Perform any service for any consideration for any person, firm or corporation after termination of his or her office or employment in relation to any case, decision, proceeding or application with respect to which he or she was directly concerned or in which he or she personally participated during the period of his or her service or employment.

(L. 1978 H.B. 1610 § 4, A.L. 1991 S.B. 262, A.L. 1998 H.B. 1120, A.L. 2004 S.B. 968 and S.B. 969, A.L. 2005 H.B. 577 merged with S.B. 307)

RSMo 105.458:  Prohibited acts by members of governing bodies of political subdivisions, exceptions.

1. No member of any legislative or governing body of any political subdivision of the state shall:

(1) Perform any service for such political subdivision or any agency of the political subdivision for any consideration other than the compensation provided for the performance of his or her official duties, except as otherwise provided in this section; or

(2) Sell, rent or lease any property to the political subdivision or any agency of the political subdivision for consideration in excess of five hundred dollars per transaction or five thousand dollars per annum, or in the case of a school board five thousand dollars per annum, unless the transaction is made pursuant to an award on a contract let or a sale made after public notice and in the case of property other than real property, competitive bidding, provided that the bid or offer accepted is the lowest received; or

(3) Attempt, for any compensation other than the compensation provided for the performance of his or her official duties, to influence the decision of any agency of the political subdivision on any matter; except that, this provision shall not be construed to prohibit such person from participating for compensation in any adversary proceeding or in the preparation or filing of any public document or conference thereon.

2. No sole proprietorship, partnership, joint venture, or corporation in which any member of any legislative body of any political subdivision is the sole proprietor, a partner having more than a ten percent partnership interest, or a coparticipant or owner of in excess of ten percent of the outstanding shares of any class of stock, shall:

(1) Perform any service for the political subdivision or any agency of the political subdivision for any consideration in excess of five hundred dollars per transaction or five thousand dollars per annum, or in the case of a school board five thousand dollars per annum, unless the transaction is made pursuant to an award on a contract let after public notice and competitive bidding, provided that the bid or offer accepted is the lowest received;

(2) Sell, rent or lease any property to the political subdivision or any agency of the political subdivision where the consideration is in excess of five hundred dollars per transaction or five thousand dollars per annum, or in the case of a school board five thousand dollars per annum, unless the transaction is made pursuant to an award on a contract let or a sale made after public notice and in the case of property other than real property, competitive bidding, provided that the bid or offer accepted is the lowest received.

(L. 1978 H.B. 1610 § 6, A.L. 1985 H.B. 193, A.L. 1998 H.B. 1120, A.L. 2005 H.B. 577 merged with S.B. 306 merged with S.B. 307)

RSMo 105.461:  Interest in measure, bill, or ordinance to be recorded--financial interest statement.

1. The governor, lieutenant governor, any member of the general assembly, or any member of the governing body of a political subdivision who has a substantial personal or private interest in any measure, bill, order or ordinance proposed or pending before the general assembly or such governing body, shall, before such official passes on the measure, bill, order or ordinance, file a written report of the nature of the interest with the chief clerk of the house of representatives or the secretary of the senate or clerk of such governing body and such statement shall be recorded in the appropriate journal or other record of proceedings of the governing body. The governor shall make the governor's written report along with the governor's approval or disapproval of any bill or act of the general assembly describing the nature of the interest and such report shall be recorded in the journal of the house of representatives or of the senate.

2. The governor, lieutenant governor, any member of the general assembly, or any member of the governing body of a political subdivision shall be deemed to have complied with the requirements of this section if such official has filed, at any time before the official passes on such measure, bill, order or ordinance, a financial interest statement pursuant to sections 105.483 to 105.492 which discloses the basis for the official's substantial personal or private interest or interests that the official may have therein. Any such person may amend the person's financial interest statement to disclose any subsequently acquired substantial interest at any time before the person passes on any measure, bill, order or ordinance, and shall be relieved of the provisions of subsection 1 of this section.

(L. 1991 S.B. 262 § 105.460, A.L. 1997 S.B. 16)

Well, there you have it!  The material facts as I currently know and understand them and the "potentially applicable" Missouri state laws as provided to me by Julie Allen of the Missouri Ethics Commission.

So folks, what do you think?  Did Presiding Commissioner Ron Jost and Southern District Associate Commissioner Jerry Lairmore violate any of the provisions of state law when they voted to do away with the competitive bidding process for the county's tire and tire services business last Thursday during the County Commission Meeting?  Does Presiding Commissioner Ron Jost have a financial "conflict of interest" or a general "conflict of interest" by virtue of his past business relationship with and close family relationship to Don Jost?  Should Presiding Commissioner Ron Jost have refrained from taking a position on the county tire contract discussion and should he have abstained from voting on the proposal made by Lairmore?  If you are unsure whether either one violated any provision of Missouri state law, do you think their decision to do away with the competitive bidding process for tires and tire services was unwise and not in the best interest of county taxpayers?  Do you think their actions and the votes they took were unethical?

You make the call!  Let us know what you think!  "Afterall," as reporter Elliott Davis from FOX 2 News in St. Louis always says ..... "YOU PAID FOR IT!"

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