Pennsylvania

How Herm Suplizio remade DuBois, PA and what went wrong · Spotlight PA State College

As you enter from the east, a large sign is perched on an embankment covered with gray stone and a gentle waterfall. It towers over DuBois Avenue, and spells out D-U-B-O-I-S in bold, four-foot-tall white letters — the result of $2.3 million in federal, state, and city funding that Suplizio oversaw.

The small city about 100 miles northeast from Pittsburgh is home to three first-rate ball fields, each molded according to Suplizio’s dream to be a destination for youth and collegiate sports. He oversaw their development, and found the money to pay for them.

On the north end of town, Suplizio upgraded the Tannery Dam area, a serene and beloved local fishing spot, by adding lighting, restrooms, and a sidewalk. The money came via the state with help from former Pennsylvania Senate President Pro Tempore Joe Scarnati — a “true friend” of DuBois, Suplizio has said.

This small city of about 7,400 people is in many ways an aberration. As many others like it across Pennsylvania have struggled to attract residents and investment, attention from Harrisburg, and coveted redevelopment dollars, DuBois — led by its city manager, Suplizio — has excelled.

As one of his supporters put it, he’s made DuBois “one of the richest little cities in all of Pennsylvania.”

But a massive corruption case brought against him by the state Office of Attorney General alleges Suplizio, too, was getting rich off DuBois’ success. Authorities allege he shrewdly used his power, network of political connections, and control over local organizations and charities to line his own pockets for almost a decade.

In all, they allege Suplizio stole hundreds of thousands of dollars in public and nonprofit funds. And the investigation appears to be expanding. Spotlight PA has learned that at least one current city official received a subpoena late last month to testify before a federal grand jury in Pittsburgh — while another employee was interviewed by the FBI — a sign that DuBois’ time under a microscope is far from over.

Suplizio has been suspended from his city job with pay since the charges were announced. He and his lawyers have said little publicly about the case, and have denied multiple requests for an interview for this story. He’s signaled to supporters that it’s all a big misunderstanding over what amounts to bad bookkeeping, and his allies on the City Council, along with the city’s solicitor, have circled the wagons around him.

For the past seven months, Spotlight PA has crisscrossed the city to speak with more than two dozen residents, elected officials, local business owners, community organizers, and nonprofit organizations. The newsroom filed a half dozen public records requests seeking a wide range of financial records — including city budgets, audits, legal bills, contracts, and bonus history — and attended city meetings and court hearings about Suplizio’s case.

The charges have led to uncomfortable questions about Suplizio’s time as city manager. Do his achievements stand on their own, or were they only borne out of entrenched corruption? If so, how could such crimes have gone unnoticed for so long?

But the story that emerges is as much about Suplizio as it is about a deep-rooted sense that if good things are happening in a community — especially amid the adversity faced by other small cities and towns in Pennsylvania — why question them, even when there are red flags?

Suplizio’s vision to turn DuBois into a destination for youth and collegiate baseball was realized thanks to state grants and wealthy donors. The Showers Field, renovated about a decade ago, now hosts the Small College World Series, among other competitions.

Suplizio’s fields of dreams

The Suplizios are something of a political dynasty in DuBois.

Herm Suplizio was the youngest of seven children who grew up in the “flats” of DuBois, a section of the city that would often flood. His father, the late Dominick G. Suplizio Jr., was also born and raised in DuBois, and worked as a carman for the Baltimore and Ohio Railroad and the Chesapeake and Ohio Railroad for over four decades.

Throughout his life, Dominick Suplizio was deeply involved in DuBois’ storied volunteer fire department — a point of great pride for the city — as well as local government. He passed both traditions down to his son.

“I started off low, I started off at the bottom,” Herm Suplizio told a local television station in 2020 during an unsuccessful run for the state Senate.

A 1978 graduate of DuBois Central Catholic School, Suplizio built his reputation early on as a dedicated firefighter. Once recognized in Congress for his service to the city’s volunteer fire department, he became the fire chief in the 1990s and was a hands-on leader.

“He wasn’t just standing on the sideline. He was the first one running into the building,” said Shannon Gabriel, who until recently served on the DuBois City Council, and whose husband is also a volunteer firefighter. “As a wife of a firefighter, he is the one I would want by my husband’s side.”

Suplizio joined the city government in 2000 as mayor and president of the City Council. His priorities then were simple and included things like paving alleys and fixing sidewalks.

“I’m someone who likes to get things done,” Suplizio told the Lock Haven Express in 2020, highlighting his efforts to bolster the city’s infrastructure and pursue streetscape projects.

In testimony to the Pennsylvania Utility Commission, Suplizio said he was acting city manager “from the Fall of 2000 through 2002, and June of 2006 through 2010” at the same time that he was mayor. State law prohibits this conflict of power, and the DuBois City Council did not answer Spotlight PA’s questions about whether Suplizio’s statement was accurate or if anyone raised concern about the potential violation.

When Suplizio officially became city manager in 2010, he stepped into a position with vast powers. In 1980, DuBois adopted an optional “council-manager” plan for its government — one of only two Pennsylvania cities to do so. Under this structure, the appointed city manager becomes the chief administrator of the city, directing nearly all city staff and acting as a link — and a firewall — between the council and city departments.

As city manager, Suplizio’s vision for the city became bolder, one with a Field of Dreams-like quality: turning his small town into a world-class venue for youth and collegiate baseball. Build the fields, and the rest — tourists and all the benefits they would bring to the local economy — would follow.

It is the kind of dream that requires more cash than what a small-town budget can typically afford. Local governments in Pennsylvania rely heavily on property taxes for revenue, and ambitious projects with high price tags are often out of reach.

DuBois, records show, solved that problem in large part with state grants. In fact, it received far more than other cities of similar size.

A Spotlight PA analysis of state grants to Pennsylvania cities with populations from 5,000 to 10,000 people found DuBois raked in more than $13 million between 2014 and July 2023. That was the most per capita of any of its peers and more than double the average total.

Some of the money funded water and sewage projects. Other dollars went toward improving a bridge, a park, and the city’s pool, according to state data.

Through more than $600,000 in federal dollars and nearly $750,000 in state grants, for instance, DuBois financed the “top of the boulevard” project that erected the towering DuBois sign. (The city also paid over $1 million for it.) The site, Suplizio told the Courier Express newspaper, was “another way to add things to our city.”

Some of the largest grants went toward constructing or upgrading ball fields, records show.

Starting in 2013, the city launched a major renovation of one of its facilities, Showers Field. These days, it is home to the Small College World Series, among other competitions.

“It was the vision of City Manager, John ‘Herm’ Suplizio, to make the fields of the City of DuBois small versions of minor league ball fields and a place people would seek to play,” the city website proclaims. “That dream was achieved, as the City of DuBois is home to three of the best fields in the Tri-State area.”

More fields followed.

The city redeveloped a softball field into a “miracle” field in 2016 for players with disabilities. Formally called the Rose and Dennis Heindl Memorial Field, it is now a multipurpose facility that hosts the Little League Challenger Division.

The city paid for it, in part, with a $1.25 million grant from the state. In making the announcement, Suplizio thanked one person in particular: Joe Scarnati, then-president pro tempore of the Pennsylvania Senate.

Under Suplizio’s helm, DuBois transformed into “one of the richest little cities in all of Pennsylvania,” as one supporter put it.

A network of powerful friends

In DuBois, Scarnati was considered a friend. He hailed from Brockway, just a few miles to the north.

As the chamber’s top lawmaker until his retirement in 2020, Scarnati was in a prime position to help steer state money toward his own district.

In the years before the Republican lawmaker retired, grants that flowed to the city were even dubbed “Scarnati grants,” according to one DuBois employee who was not authorized to speak publicly on behalf of the city and asked to remain anonymous.

“We literally had CDs that were called ‘Scarnati Grant 1’ and ‘Scarnati Grant 2,’” the employee said, referring to the bank certificates of deposit that were created when the funding arrived.

Scarnati did not respond to requests for comment for this story.

Many of the state grants DuBois received over the past decade flowed from the Department of Community and Economic Development. Others, like the $1.25 million for Heindl Field, came from the state Redevelopment Assistance Capital Program, or RACP.

Though grants through RACP require a lengthy application process, politics fuels which projects are funded as much as merit, according to interviews with current and former Pennsylvania Capitol staffers. Legislative leaders actively participate in the process, lobbying for specific projects in their district and the districts of fellow lawmakers within their party.

Much of that brokering still takes place in secret.

Nathan Benefield, senior vice president of the conservative Commonwealth Foundation in Harrisburg, said many of the grant programs as a whole are more about “political development, not economic development.”

“It’s not transparent at all,” he said. “It’s done very much behind closed doors.”

DuBois also benefited from private donations from wealthy entrepreneurs and organizations. That money, according to interviews, was also leveraged through relationships that Suplizio forged.

How he did it remains opaque. Several people who spoke to Spotlight PA privately attributed his successes to a combination of charm and luck: Suplizio, they said, is charismatic, and he possesses a gift of gab that enables him to sell his vision for the city at every turn.

It also helped that prominent political and business figures hailed from the greater DuBois region.

Heindl Field, for instance, was underwritten by Ridgway businessman Denny Heindl, part owner of the Pittsburgh Pirates. He gave at least a quarter million dollars toward the construction of the venue plus $10,000 every year for the field’s maintenance. Pirates Charities, the team’s nonprofit that supports youth health, fitness, and education programs, donated another $100,000.

Not all of the private donations have been as transparent.

The Frank Varischetti Foundation — created in honor of its namesake businessman and run by his family, which is a minority owner of the Pittsburgh Steelers — donated a total of $100,000 to the City of DuBois between 2018 and 2021, according to its tax filings.

The filings do not detail what the money was intended for, and representatives from the foundation did not return calls or emails requesting comment. DuBois also rejected a public records request by Spotlight PA to provide information about its gifts and donations.

However, earlier this year, the city provided a copy of an agreement between itself and the foundation to LNP | LancasterOnline, a partner newsroom of Spotlight PA. The agreement, dated late November 2017, says the $100,000 was for the construction of a “boundless playground” in the city.

Peter Varischetti, the foundation’s secretary according to its most recent tax filing, has publicly praised Suplizio’s contributions to the city.

“Herm Suplizio gets results,” Varischetti, who did not respond to multiple requests for comment, wrote in a 2020 op-ed.

“I am proud to call Herm a friend.”

The endorsement came as Suplizio ran to succeed Scarnati in the state Senate as his handpicked candidate. Scarnati’s campaign committee donated more than $360,000 to the unsuccessful campaign. Varischetti chaired a political committee that donated more than $26,000 to Suplizio’s campaign.

Since leaving the state Senate, Scarnati has continued to bring money to DuBois in a new role. In 2021, Suplizio awarded the new lobbying firm Scarnati founded with partners Nick Varischetti and Tommy Johnson a $5,000 per month contract with the City of DuBois.

Though larger cities — like Lancaster, Philadelphia, Pittsburgh, and Reading — employ lobbyists, it is not common for smaller towns to have paid advocates in Harrisburg.

The firm helped DuBois land more than $4 million from four different state grants “for the betterment of the community,” it said in an email obtained through a public records request.

Bonus city

As the city benefitted from his connections, Suplizio’s profile — and responsibilities — grew.

But there were concerns about his bookkeeping, according to interviews with current and former city officials.

Suplizio would allegedly sometimes pay bills submitted to the city even when they didn’t have detailed invoices attached. He would also sometimes code expenses across different categories in the budget to help the fire department receive more money for equipment — but also make it hard to track what the money was being used for.

His city manager position gave him broad powers over spending, hiring, firing, and other aspects of running DuBois’ government, an arrangement that made it difficult to question his decision-making. His reputation as a champion of DuBois, and the trust he garnered by securing big money to prop up the city, made it even harder.

He also took care of his employees financially, records show.

Between 2014 and 2022, Suplizio quietly gave more than $561,000 in bonuses from city coffers to key staffers, including the city’s finance director, deputy treasurer, engineer, and redevelopment authority director, according to information obtained through public records requests.

Suplizio also rewarded himself. In fact, he was the biggest beneficiary.

The records indicate he gave himself annual bonuses ranging from $8,000 to more than $64,000. This was in addition to his $108,000 annual salary since 2015 and fringe benefits. In all, he made $357,358.54 in bonuses during that eight-year period, over eight times as much as what the next highest bonus earner received.

“Unbelievable,” said Greg Primm, a past president for the Pennsylvania association that advocates for professionalism and ethics in local governance, after hearing the amount of bonuses given out. “My mind is blown.”

Primm said giving bonuses to government employees without a clear policy or public discussion is “not a practice that I have ever seen any municipality do or I’m accustomed to in any way,” especially bonuses in the amounts approved by DuBois.

Spotlight PA could not locate any mention of how bonus decisions were made in the city’s meeting minutes from 2021 to 2023.

Former DuBois City Manager Ron Trzyna told Spotlight PA that the city did not give out bonuses to employees during his time in the position from 2001 to 2006, and questioned the practice during a public meeting of the City Council this past spring.

City Council members have not indicated whether they knew about, questioned, or approved the bonuses. Spotlight PA reached out to all five members of the panel, and they either declined to be interviewed or did not respond to multiple requests for comment.

The city’s solicitor, Toni Cherry, also declined to be interviewed for this story. She has publicly questioned the investigation of Suplizio, at one point calling the state’s corruption case against him “official oppression” during a City Council meeting.

Suplizio ran an ultimately unsuccessful state Senate campaign in 2020 as former Senate President Pro Tempore Joe Scarnati’s handpicked successor. (Screenshot via Youtube)

A tangled web

Aside from his work for the city, Suplizio held leadership positions with two other prominent local organizations: the DuBois Area United Way, where he served as executive director, and Community Days, an annual summer celebration in the city.

Both have close financial ties with the DuBois city government and at points shared personnel in key positions. But no one in the city publicly flagged Suplizio’s cross-involvement in those organizations as presenting the potential for conflicts.

The many charges against him illustrate the tangled web of jobs and responsibilities that Suplizio juggled, sometimes with little oversight or accountability. Prosecutors allege he moved money in and out of the various bank accounts he managed at those organizations, and ultimately ended up stealing from them.

In all, prosecutors allege Suplizio stole more than $550,000 from the City of DuBois, the DuBois Volunteer Fire Department, and the DuBois Area United Way. In the case of Community Days, they contend he wrote checks from bank accounts associated with the event to pay his credit card bill and make political contributions.

Law enforcement officials also allege Suplizio charged city taxpayers and the United Way for his cellphone and mileage expenses, and then claimed those amounts as unreimbursed business expenses on his taxes (which in turn lowered his taxable income).

In the updated charges announced last month, prosecutors also noted several questionable transactions Suplizio made with United Way funds. In one instance, Suplizio allegedly moved nearly $3,000 from the United Way’s checking account into his personal savings account. In another, Suplizio allegedly cashed a $3,900 check payable simply to “cash.”

Suplizio also allegedly paid his personal credit card bill in eight instances with checks from the United Way — a practice flagged by the organization’s auditors, who said it should not be making direct payments to personal credit cards.

In a statement earlier this year, the United Way’s board of directors disputed “with a reasonable degree of certainty” that Suplizio had misappropriated funds from the organization. They did not elaborate.

One thing is clear: Suplizio’s United Way position put him in the decision-making seat on both ends of a deal when the organization collaborated with the city on various projects — again raising the specter of a conflict.

Records obtained by Spotlight PA reveal that in 2014, for instance, the United Way gave $30,000 to the city for a “baseball field sign purchase.” In 2016 and 2021, the charity made two additional donations totaling $60,800 to the city for “general support.”

So close was the working relationship that in 2018, the United Way began acting as an “agent for the City of DuBois,” according to financial statements submitted by the charity. Those records said the United Way collected contributions for capital construction and improvements for several baseball fields and related facilities operated by the city.

Spotlight PA found a total of $560,503 in contributions to the city were handled by the United Way from 2018 to 2020 — a period when Suplizio reigned over both entities.

And during that time, there were bookkeeping problems.

The United Way’s auditors, Sharkey Piccirillo & Keen, noted in a 2020 report that $352,000 in donations for the city had mistakenly been recorded as income for the charity and issued a correction to its bookkeeping.

Also in 2020, the same auditing firm — separately employed by the City of DuBois — found that “a significant amount of donations” for a city ball field “were inadvertently deposited into the DuBois Area United Way account” in 2019. According to the auditors, the issue was “not detected by the City’s internal controls.”

A response letter signed by Suplizio at the time said the finding was immediately corrected, but did not explain how the erroneous deposit took place in the first place.

United Way officials did not answer questions about whether Suplizio’s dual role was ever flagged as posing a potential conflict.

The organization has a policy requiring its staff and board members to file reports outlining any potential conflicts of interest, but the United Way did not answer questions about whether Suplizio ever filled one out.

Residents and visitors gathered for Community Days, an annual summer festival associated with the DuBois Volunteer Fire Department, on June 16 and 17, 2023.

A marquee event

Prosecutors also allege Suplizio misappropriated funds from bank accounts associated with another entity he controlled: the loosely assembled fundraising committee for Community Days, DuBois’ annual parade and celebration.

The festival honors the city’s volunteer fire department, which is fully funded by the city — a rarity in Pennsylvania. Proceeds raised from the event cover expenses associated with the festival and parade, which over the years has attracted well-known sports and entertainment personalities.

In 2021, for instance, the “Pittsburgh Kid” — former Pirate Neil Walker — served as the parade’s grand marshal. In 2018, former Pirates manager Jim Leyland attended the event.

All that star power for “little DuBois,” is how Suplizio put it in a 2014 interview he conducted on Community Days and its importance to the city.

Staging the event cost money — and once again Suplizio found himself on both ends of the deal. Community Days ran its organizing efforts out of the United Way’s headquarters in DuBois.

Suplizio was instrumental in the parade committee’s fundraising efforts. According to prosecutors, among the people who donated money were city vendors whose contracts Suplizio had power over as city manager.

The starkest example of those blurred boundaries, according to the state attorney general’s office: a deal Suplizio allegedly worked out with the city’s waste disposal contractor, then called Advanced Disposal Systems.

Under the deal, the company paid a quarterly $15,000 administrative fee, by check, to the City of DuBois. Instead of going into the city’s general fund, prosecutors allege, the money was deposited into bank accounts controlled by Suplizio and affiliated with Community Days. Though Community Days bank accounts shared the same tax ID number as those of DuBois’ city government, city officials didn’t monitor them, according to the criminal complaint against Suplizio.

Investigators allege that when they reviewed several years’ worth of budgets for Community Days, they found that the payments from ADS were penciled in as being much lower, in the $1,000 range. The charging documents do not explain the alleged discrepancy, and the attorney general’s office has declined to provide further details about its case, which initially had been cloaked in an unusual veil of secrecy.

Ed Yahner — a manager for ADS, which is now known as Waste Management, and a longtime board member of the DuBois Area United Way — did not respond to multiple requests for an interview.

The entanglement didn’t end there.

Records reviewed by Spotlight PA show that when Suplizio helmed the United Way, the charity separately made small donations to a training fund for the city’s fire department. Suplizio was once the fire department’s chief, and until recently, was the captain of the Friendship Hose Company #2, one of the department’s five companies.

It’s not clear what the money paid for. The city denied the news organization’s request to see records of donations received by the Community Days fund and the money’s purpose. The newsroom has appealed the decision, arguing those records should be disclosed.

Court records released by prosecutors last month contend that Suplizio also benefited from his deep connection with the DuBois Volunteer Fire Department — one entity the city manager, according to state law at least, does not oversee. The records note Suplizio launched a company in 2011 called JH Suplizio Battalion One Fire Equipment that sells equipment to fire departments and related entities.

Battalion One, investigators noted, bought most of the equipment from a manufacturer, then allegedly marked it up by 50%. Its customers included Friendship Hose Company #2 and the DuBois Volunteer Firemen’s Relief Association.

The state Ethics Act prevents public employees from entering into contracts valued at $500 or higher with the government body they are associated with unless it’s done with public notice and disclosure. On three state forms on which Suplizio detailed his financial interests, he noted that he sold fire equipment, but did not mention his customers were fire departments he worked with.

Perception versus reality

Since Suplizio was charged earlier this year, city officials have been cautious in their public statements about the suspended manager and his case.

But their actions have spoken volumes.

In late March, the City Council voted to place Suplizio on administrative leave but kept him on the payroll — despite objections from the public. They also rescinded a previous vote that would have extended Suplizio’s contract.

A resident questioned the Council in the following meeting on one particular detail: Suplizio’s employment contracts with the city did not include a morality clause, which is commonly used to protect employers in case workers engage in bad behavior and allow for the contract to be terminated.

In April, the Progress News reported the City Council had voted to pay more than $270,000 in legal fees for Suplizio’s defense.

The Council also decided against filing a claim on the city’s professional liability insurance, which would have protected DuBois and its taxpayers against employee theft. Gabriel, the former council member, told the public at the time that not filing a claim was the only way the city could keep its insurance coverage going forward.

And in one stunning development, City Council members met behind closed doors with Suplizio’s defense lawyer in May — raising concerns about improper collaboration.

Then, in August, the Council voted to negotiate a buyout with Suplizio for the remainder of his contract, which expires in March 2025. Council Member Pat Reasinger, who is affiliated with a group of reform candidates who ran on the platform “RESTORE INTEGRITY AND TRUST,” said a buyout could cost DuBois at least $157,000, and likely more if the city is on the hook for paying his unused vacation and sick time.

Apoplectic over the Council’s actions, a group of residents took the city to court to stop the city’s buyout of Suplizio’s contract, and ultimately obtained a permanent injunction against any further payments to him.

Many residents in the city and in neighboring Sandy Township — which has petitioned the court to put a pause on its planned consolidation with DuBois — perceived city leaders’ actions as a continuation of turning a blind eye.

The sharp divisions widened as officials seemingly insisted on Suplizio’s good image. No one has become as much of a lightning rod as City Solicitor Toni Cherry, who told the public in August — as the city defended lawsuits from its residents and the neighboring township — “to this day, I thought that Mr. Suplizio did a very fine job of moving this city forward.”

Cherry has repeatedly said to the public that no money is missing from city coffers, although she has never explained how she reached that conclusion. But the subtext seems clear: Suplizio did not steal.

And in one of the more bizarre twists to DuBois’ troubles, Cherry earlier this year dropped off a mysterious bag stuffed with cash totaling nearly $94,000 — and said nothing about where she got it. She has said only that the cash belonged to the city.

It was later revealed that the money had been stashed at the United Way and that lockboxes had also been found in the charity’s ceiling tiles. In charges filed in October, state prosecutors allege that Suplizio gave Cherry the money and she kept it “to keep the [attorney general’s office] from confiscating it.”

Cherry and Suplizio have a relationship that dates back decades. Like the Suplizios, the Cherrys are a political family with deep roots in DuBois. Cherry’s uncle was a longtime Clearfield County judge. Her cousin now holds the same post, having been elected to the position after serving as the county’s district attorney.

Several residents have said they fear questioning her too strenuously, even at DuBois’ increasingly tense public meetings, because they believe she wields influence over the city’s current council members. Many members will leave the board in January, having been defeated by a group of write-in candidates during the spring primary.

Still, there are cracks in the city’s otherwise unified front.

After Suplizio was charged, Gabriel, the former council member, said that like her colleagues, she wanted to give him the benefit of the doubt. That changed after Cherry dropped off the bag of cash.

Gabriel attempted to remove Cherry from the position she’s held for decades in May but failed.

“It’s perception versus reality,” Gabriel told Spotlight PA. “Even if the reality is that there was good intent, the perception is bad. It looks terrible. Who keeps money in a ceiling?”

Gabriel resigned her City Council post days later.

On the eve of her resignation, she said, she heard from Suplizio.

Don’t resign, she said he told her in a text message. There is still work to be done, he told her. Resigning, he said, would mean “they win. Do not let them win.”

https://www.spotlightpa.org/statecollege/2023/11/dubois-pennsylvania-herm-suplizio-fraud-corruption-attorney-general/ How Herm Suplizio remade DuBois, PA and what went wrong
· Spotlight PA State College

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