Ethics agency gave green light to hiring of son
CHARLESTON, W.Va. -- The state Ethics Commission privately gave the go-ahead for West Virginia Homeland Security Director Jimmy Gianato's son to be paid through a $126.3 million federal stimulus grant that Gianato administers, according to emails released Wednesday.
The April 2011 ethics agency advice paved the way for a San Antonio-based company, Alexander Utility Engineering, to hire Adam Gianato as a technician for the stimulus project.
The ethics advice came with stipulations: The engineering firm "may not be given favoritism," and Jimmy Gianato must stay out of any decisions that affect the Texas company.
Jimmy Gianato heads West Virginia's "grant implementation team" that oversees the $126.3 million project, which is designed to expand high-speed Internet across the state.
In October 2011, Alexander Utility Engineering hired Adam Gianato as a $60-an-hour technician. The state tapped federal stimulus dollars to pay Adam Gianato's salary and overtime -- $73,000 over 4 1/2 months.
Alexander Utility Engineering is helping the state build 12 microwave emergency towers across West Virginia. The state expects to spend more than $30 million out of the $126.3 million grant on the towers and wireless equipment.
In March 2011, Drema Mace, former director of the state Office of Emergency Medical Services, contacted Ethics Commission Executive Director Theresa Kirk about Adam Gianato's expected hiring.
Mace, whose office had a contract with Alexander Utility Engineering to build the towers with stimulus funds, notified Kirk that Adam Gianato had applied for a job with the San Antonio firm.
"Jimmy [Gianato] and I want to make sure there is no ethics issue," Mace wrote to Kirk.
Kirk later spoke with Mace, Gianato, Office of Emergency Services Communications Director Joe Gonzalez, and an Alexander Utility Engineering supervisor.
Mace said the emergency services office determined that the engineering firm needed more workers to complete the tower project -- and that the agency planned to hire the contract employees to inspect the towers once they were built, according to Kirk's email.
The engineering firm asked Gonzalez to suggest five people, and Gonzalez recommended Adam Gianato and several others, according to Kirk's email.
Gonzalez reports directly to Jimmy Gianato on the stimulus-funded tower project, according to an organizational chart. Gonzalez heads the project's "towers team."
"Mr. Gianato did not recommend his son or seek to influence his hiring," according to Kirk's email.
Gonzalez told Kirk that he recommended Adam Gianato for the technician job "based upon his experience." Gonzalez said Adam Gianato had volunteered for emergency communications projects during the Bridge Day festival in Fayette County, and after a flood in Raleigh County.
"Mr. Gonzalez stated he was also impressed that the son, on his own dime, took training courses related to this technology," Kirk wrote.
An Alexander Utility Engineering representative told Kirk that "he, in no way, has felt pressure to hire Mr. Gianato's son," according to Kirk's email.
Kirk said that Gianato also contacted the National Telecommunication & Information Administration, the federal agency that distributed the $126.3 million grant, about his son's hiring. The NTIA told Gianato "the hiring is permissible so long as Gianato is not the person negotiating contracts with Alexander Utility Engineering," Kirk wrote.
Kirk subsequently concluded that the state Ethics Act would not prohibit the state from using stimulus funds to pay Adam Gianato as a contract worker.
"Your office should not, however, advocate on behalf of Adam with Alexander Utility Engineering," Kirk wrote to Mace.
A National Telecommunications & Information Administration spokeswoman said Wednesday the federal agency is reviewing Adam Gianato's hiring.
In February, Gonzalez hired Adam Gianato as a full-time state worker assigned to inspect the wireless towers.
Gianato works from his home in McDowell County. His $37,500 salary is paid entirely by the stimulus funds that his father administers. The federal grant funds also has paid for a rental truck that Gianato drives to tower sites in Southern West Virginia.
Jimmy Gianato did not respond to a request for comment Wednesday.
Last week, Gianato said he did not ask Gonzalez or Alexander Utility Engineering executives to hire his son.
Gianato said he never checked back with the NTIA or the Ethics Commission after his son left his job with the engineering firm and became a state employee assigned to the tower project. Gianato said he did not notify anyone in Gov. Earl Ray Tomblin's office that his son was being paid out of the stimulus funds.
Marsha Dadisman, a spokeswoman for the Office of Emergency Services, said Gianato doesn't need to seek a follow-up opinion from the Ethics Commission.
"The commission determined there was not a conflict of interest to hire Adam as a contractor," Dadisman said Wednesday. "When he was hired as a state employee, appropriately following all Division of Personnel rules, his pattern of supervision or the lines of authority did not change. There was not an ethics issue when he became a state employee."
As the $126.3 million project's "grant administrator," Gianato has the final say on the use of the stimulus funds, including hiring and spending decisions.
The Ethics Commission issues advisory opinions and informal advice to public officials about the state Ethics Act. Gianato solicited informal advice, not an advisory opinion.
The Ethics Commission board votes on advisory opinions, and they're released publicly. Informal ethics advice is typically kept confidential.
Gianato authorized the release of Kirk's email Wednesday at the Gazette's request.
Alexander Utility Engineering billed the state $60 an hour for Adam Gianato's work -- and $90 for overtime, but the firm's invoices don't show exactly how much they paid Gianato. Contractors typically bill for a significantly higher amount than the firms actually pay their employees. Jimmy Gianato has said he didn't know how much his son earned as a contract worker for the engineering firm.
Reach Eric Eyre at email@example.com or 304-348-4869.