September 22, 2010

Termination from a position funded by a federal grant

Termination from a position funded by a federal grant
Mucci v Binghamton, Appellate Division, 245 AD2d 678, Appeal dismissed, 91 NY2d 921, Motion for leave to appeal denied, 92 NY2d 802

In the Mucci case, the Appellate Division was asked to determine if the City of Binghamton abolished a position as a subterfuge to avoid having to file disciplinary charges against the permanent incumbent of the position.

City Community Development Attorney Lawrence A. Mucci's position was funded by federal Community Development Block Grant [CDBG] monies. The City's 1996 budget did not include Mucci's position among the positions to be funded from the Block Grant. As a result, Mucci's position was abolished and he was terminated.

Mucci sued, contending that Binghamton acted in bad faith in eliminating his position because "his termination was not for economic or efficiency reasons but was related to job performance entitling him to a hearing pursuant to Section 75 of the Civil Service Law." The City's action, Mucci complained, was a subterfuge for disciplinary action, thereby denying him his statutory due process right to notice and hearing as required by Section 75.

The Appellate Division concluded that Mucci did not prove that his position was eliminated in an effort to avoid having to file disciplinary charges against him in order to remove him from his position. The Court said that Mucci had the burden of proof of demonstrating that the City acted in bad faith, which, under the circumstances, meant that he had to show that:

1. There were no bona fide reasons for the elimination of the position; or

2. That there were no savings resulting from the abolishment of the position; or

3. Someone was appointed to perform Mucci's former duties.

While observing that the City could have used other funds to continue Mucci's position or could have modified CDBG's budget to continue the position, the fact that it did not do so was not persuasive. The Appellate Division ruled that Mucci failed to meet his burden of proof.

The Court noted that Binghamton was faced with a "financial crisis" due to declining revenues. Although Mucci's former duties were performed by the City's Corporation Counsel or by "outside private counsel on an as needed basis," critical to the Court's holding was the fact that no one was hired in Mucci's place nor was another position created to perform his former duties.

According to the ruling, indications of the City's "good faith" in abolishing Mucci's position included: (1) an evaluation "by an outside source" that Mucci's position was not required and (2) some 20 positions, including Mucci's, were abolished in the 1996 budget, allowing the City to reduce its tax burden and to make more efficient use of limited Federal monies.
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