Rory M. Christian designated to serve as Chair of the New York State Public Service Commission and CEO of the State's Department Of Public Service

On September 30, 2021, New York State Governor Kathy Hochul announced the designation of Rory M. Christian as Chair of the Public Service Commission and chief executive officer of the Department of Public Service, the staff arm of the Commission.* 

Mr. Christian began his career in the energy industry with KeySpanEnergy where he first served as a civil engineer before transitioning to a role engaging government agencies operating in Long Island and New York City. In that role, he was responsible for coordinating activities between KeySpanand government organizations, negotiating contracts, developing contingency plans and streamlining operations to satisfy both organizations' operational needs.

While serving at Exelon Energy, Mr. Christian developed new products targeting public sector clientele and helped facilitate the creation of multiple partnerships and alliances. Mr. Christian also previously served as the Director of Energy Finance and Sustainability for the New York City Housing Authority. More recently, he was the Director of New York Clean Energy at Environmental Defense Fund where he provided strategy management, programming, business development and stakeholder collaboration for the Clean Energy program in NY.

Mr. Christian graduated from the City College of New York's, Grove School of Engineering with a bachelor's degree in Civil Engineering and an MBA from the Baruch College, Zicklin School of Business. 

* Nonpartisan by law since 1970, the six member Public Service Commission regulates New York State's electric, gas, steam, telecommunications, and water utilities and oversees the cable TV industry. The Commission also exercises jurisdiction over the siting of major gas and electric transmission facilities and has responsibility for ensuring the safety of natural gas and liquid petroleum pipelines. Members of the Commission are appointed by the Governor and confirmed by the State Senate for a term of six years or to complete an unexpired term of a former Commissioner.

Procedural errors or omissions preclude consideration of an Education Law §310 appeal to the Commissioner of Education on its merits

Petitioners in the appeal to the Commissioner of Education alleged that the school district [District] “systematically interfered with” the election to the school board by “providing absentee voter poll data before the polls closed"; using District resources “to advocate a ‘yes’ vote on the [s]chool [b]udget”; an employee organization "obtained voter contact information and used it 'to send an advocacy postcard to arrive simultaneously with [e]lection [b]allots,'” and that the superintendent “targeted email communications about the [b]udget and [t]rustee [v]ote to parents of children in the school district and not to the whole electorate.”

Petitioners asked the Commissioner issue an order overturning the results of the election and vote. Citing 8 NYCRR 275.10, the Commissioner said that in an Education Law §310 appeal to the Commissioner:

a. The petitioner has the burden of demonstrating a clear legal right to the relief requested and establishing the facts upon which he or she seeks relief; and

b. Mere speculation as to the existence of irregularities or the effect of irregularities is an insufficient basis on which to annul election results.

The Commissioner then addressed a number of procedural issues raised by respondents in this appeal: 

1. With respect to Petitioners' challenge to alleged actions the employee organization in the voting process, the Commissioner opined that it is well settled that union organizations and their representatives are not subject to the jurisdiction of the Commissioner of Education in appeals submitted pursuant to §310 of the Education Law and thus she lack jurisdiction over Petitioners' claims with respect to the employee organization's alleged participation in the election.

2. With respect to Petitioners' claims involving the Freedom of Information Law [FOIL],  the Commissioner held that such claims must dismissed for lack of jurisdiction, explaining that §89 of the Public Officers Law "vests exclusive jurisdiction over alleged FOIL violations in the Supreme Court of the State of New York."

3. The Commissioner then ruled that Petitioners’ remaining claims must be dismissed for failure to join "a necessary party," indicating that an individual or an entity whose rights would be adversely affected by a determination in favor of a petitioner is a necessary party and must be joined as such. As an example, the Commissioner noted that in an appeal involving a school district election, the petitioner must join the district’s board of education as well as “each person whose right to hold office is disputed.”

Accordingly, the Commissioner dismissed Petitioners' §310 appeal for lack of jurisdiction. 

The Commissioner then noted that "even if the appeal were not dismissed on procedural grounds, it would be dismissed on the merits," explaining that in order to invalidate the results of a school district election, the petitioner must either:

(1) Establish not only that irregularities occurred but also that any irregularities actually affected the outcome of the election or were so pervasive that they vitiated the electoral process; or

(2) Demonstrate a clear and convincing picture of informality to the point of laxity in adherence to the Education Law.

On this record, said the Commissioner, Petitioners have failed to carry their burden of proving that any irregularities occurred and affected the outcome of the election.

In the words of the Commissioner: "Although Petitioners object to various alleged actions of the district respondents, [Petitioners] have not provided any evidence, such as an affidavit from a district voter, to establish that such actions impacted the results of the election in any way."

Thus, opined the Commissioner, even if the appeal were not dismissed on procedural grounds, it would have been dismissed on the merits. 

Click HERE to access the full text of the Commissioner's decision.

New York State Department of Health Commissioner appointed

On September 29, 2021, New York State Governor Kathy Hochul announced Mary T. Bassett, MD, MPH, has been appointed Commissioner, NYS Department of Health.

Governor Hochul said "With more than 30 years of experience devoted to promoting health equity and social justice, both in the United States and abroad, Dr. Bassett's career has spanned academia, government, and not-for-profit work."

Dr. Bassett's appointment is effective December 1, 2021.

Judicial immunity and other bars to federal courts exercising jurisdiction over lawsuits challenging actions by a state court

The Plaintiff [Petitioner] appealed the dismissal of his pro se lawsuit in which New York State Unified Court System, its Office of Court Administration [OCA], and certain OCA personnel [collectively "Respondents"] were alleged to have violated Title II of the Americans with Disabilities Act of 1990 [ADA], 42 U.S.C. §§12131–12165, and §504 of the Rehabilitation Act, 29 U.S.C. §794 et seq. in the course of Plaintiff's family court action.

Petitioner alleged that Respondents denied certain of his requests for ADA accommodations and that he had suffered other damages in the course of his participation in certain New York State judicial and related proceedings.

1. With respect to Petitioner's claim for damages targeting a law clerk to a judge, the Circuit Court of Appeals concluded that judicial immunity bars such claims for damages. The court explained that “[A]cts arising out of, or related to, individual cases before the judge are considered judicial in nature” and protected by judicial immunity and "for purposes of absolute judicial immunity, judges and their law clerks are as one”. Accordingly, said the court, a law clerk "is sheltered from a damages claim for the actions taken by her in the capacity of court attorney."

 2. Addressing Petitioner's claims for injunctive and declaratory relief with respect to act or omissions of certain named Respondents, the Circuit Court of Appeals concluded all such claims against the Respondents must be dismissed in consideration of [a] the Rooker-Feldman doctrine, which prohibits federal courts from exercising jurisdiction over suits challenging final state court orders, and [b] the rulings in Younger [401 U.S. 37]  and O’Shea [414 U.S. 488] with respect to "abstention," which rulings caution that federal courts generally should refrain from enjoining pending state court proceedings. The Circuit Court of Appeals then opined that the federal district court "correctly concluded that it was either unlawful or imprudent for it to enter any order directing the state family court to conduct its affairs differently than it did in dealing with [Petitioner]." 

 3. With respect to claims for damages against OCA respondents, the Circuit Court of Appeals noted that although the district court "relied on the Eleventh Amendment in entering its dismissal order", it could affirm on any ground fairly presented by the record on appeal. It then so acted, "on the ground that [Petitioner] has failed to state a claim on which relief may be granted. The court explained that to establish a prima facie claim under either Title II of the ADA or §504 of the Rehabilitation Act, "a plaintiff must satisfy three requirements: he must show that (a) he is a “qualified individual” with a disability; (b) he was excluded from participation in a public entity’s services or programs or was otherwise discriminated against by a public entity; and (c) such exclusion or discrimination was due to his disability." Regardless of the correct resolution of claims advanced by Petitioner with respect to his being a "qualified individual" with a disability, the court concluded that Petitioner "has not plausibly alleged facts to satisfy the second and third requirements of the prima facie case."

4. As to Petitioner's assertion that OCA violated the ADA by failing to provide an ADA-compliant grievance procedure, the court noted that this assertion "is flatly contradicted" by both general information in the public record and specific records in Petitioner's case and the fact that "[t]he state court judicial record shows that [Petitioner] availed himself of these appeals processes." 

Accordingly, the court affirmed the district court’s dismissal of the damages claims against the Respondents as Petitioner "has not stated a claim on which relief may be granted."

Click HERE to access the Circuit Court of Appeals' decision.

The New York State Workers’ Compensation Board to propose new medical treatment guidelines

In keeping with the goals of the New York State Workers’ Compensation Board [Board] to create medical guidelines for the treatment of injured workers using the most effective evidence-based modern diagnostic and treatment techniques, the Board plans to propose three new New York Medical Treatment Guidelines (MTGs): 

New York Eye Disorders MTGs 

New York Traumatic Brain Injury MTGs

New York Complex Regional Pain Syndrome MTGs

Regulations providing for these updated MTGs and comments from the public will be published in the State Register and on the Board’s websites.

Questions concerning these proposed MTGs may be e-mailed to:

 Regulations@wcb.ny.gov.

Claim for unemployment insurance benefits denied because the applicant was found to have voluntarily left his employment without good cause

A claim for unemployment insurance benefits filed by a City of New York maintenance and filter plant operator [Claimant] at a public swimming pool filed by resigned from his position. Claimant contended that he resigned because he believed that the working conditions in the maintenance facility constituted a dangerous work environment.

The Unemployment Insurance Appeal Board [Board] ruled that Claimant was disqualified from receiving unemployment insurance benefits because he voluntarily left his employment without good cause. Claimant appealed.

The Appellate Division affirmed the Board's decision, explaining "whether a claimant has good cause to leave employment is a factual issue for the Board to resolve and its determination will be upheld if supported by substantial evidence."

Citing Matter of Micara [Commissioner of Labor], 307 AD2d 568, the court said "Objections to the environmental conditions in the workplace will not [constitute good cause for leaving employment] unless the claimant can show reasonable grounds for the perception that his or her personal safety or health would be endangered thereby."

The court found that the record established that Claimant told his supervisor that he was required to clean a "hair catcher" twice a day but a defective valve made it impossible to control the water that gushed out, necessitating the help of other coworkers to hold down the cover. Although the valve was not permanently fixed after the defect was reported by Claimant, Claimant's supervisor testified that, although it was difficult to clean, it was not unsafe and, in any event, he told Claimant that he no longer was required to clean the hair catcher.

As to other perceived hazardous conditions at the pool maintenance facility reported by Claimant, his supervisor testified regarding the training and protective equipment provided the Claimant and that the facility is inspected by two government agencies for safety at least once a year. The supervisor also testified that he was trying to accommodate Claimant's request to be transferred to another assignment, but that Claimant had resigned before a position became available.

In addition, Claimant conceded that he did not have any adverse health issues as a result of his working conditions, nor did he consult with a doctor prior to resigning.

Accordingly, the Appellate Division found that substantial evidence supported the Board's decision that Claimant voluntarily left his employment without good cause.

Click HEREto access the Appellate Division's decision.

Audit Finds Western Regional OTB Lacks Accountability and Gave Out Lucrative Perks

The Western Regional Off-Track Betting Corp. (OTB) spent at least $121,000 on tickets to sporting events, concerts, food and alcohol for board members, employees and other individuals without the oversight required by state rules, according to an auditreleased by New York State Comptroller Thomas P. DiNapoli.

A second audit released found the OTB’s CEO did not reimburse the organization for his personal use of an official vehicle in a timely manner. 

Click on the text highlighted in color above to access the complete audit report.

 

Audits and reports issued during the week ending September 24, 2021, by the New York State Comptroller

New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending September 24, 2021 

Click on the text highlighted in color to access the complete audit report.

MUNICIPAL AUDITS

Town of Amherst Industrial Development Agency – Project Approval and Monitoring (Erie County) The board did not properly approve and monitor projects. Auditors determined the board did not ensure its project approvals were based on project applications that were completed and supported with applicable supplemental documentation and an adequate cost-benefit analysis. The board and officials also did not properly monitor to ensure the annual report filed with the New York State Authorities Budget Office and the Office of the State Comptroller was accurate with respect to job performance, sales tax exemptions and payment in lieu of taxes (PILOT) information for current and active projects.

 

Town of Berne – Board Oversight (Albany County) The board did not provide adequate oversight of financial operations and exceeded its authority under New York State Town law by authorizing the supervisor to pay all expenditures without prior audit. The board did not request or receive adequate monthly reports from the supervisor. For example, the board did not request or receive monthly cash reports detailing money received and disbursed, monthly bank reconciliations or cash balances for each fund. The board also did not ensure bank reconciliations were accurate, timely, and properly reviewed.

 

Town of Boylston – Financial Condition (Oswego County) The board did not effectively manage the town’s financial condition. As a result, it levied more taxes than necessary to sustain operations. The board also did not adopt realistic budgets and failed to monitor budgetary results during the year. In addition, the board allowed excessive levels of surplus funds to increase. As of December 31, 2020, the general fund’s surplus funds were $134,448, or 89% of actual expenditures. In addition, the highway fund’s surplus funds were $386,162, or 84% of actual expenditures. The board diminished financial transparency by annually appropriating fund balance that was not needed to fund operations.

 

Town of Clarence Industrial Development Agency (CIDA) – Project Approval and Monitoring (Erie County) The board did not properly approve or monitor its projects. The board also did not verify job creation goals or other criteria while assessing material aspects of the proposed projects prior to approving them. The board did not properly monitor projects to determine whether project goals were being met. Officials did not ensure that project approvals were transparent to the public by posting required documents on CIDA’s website. In addition, the board and officials did not ensure that CIDA’s annual report was accurate before submitting it to state oversight agencies.

 

Village of Clayton – Claims Auditing (Jefferson County) The board did not properly audit claims prior to payment or ensure written quotes were obtained as required. The board reviewed listings of claims but generally did not review them before approving payments. Health insurance claims totaling $495,104 were not approved for payment by the board, and claims totaling $52,000 to the local Chamber of Commerce did not include receipts as required. Of the purchases totaling $239,411 from 34 vendors auditors examined, village officials purchased goods and services totaling $141,269 from 27 vendors without obtaining written quotes or retaining supporting documentation of their solicitation efforts or justifications for not seeking competition, as required. The village’s procurement policy did not comply with New York State General Municipal Law. 

 

City of Cortland – Non-Contractual (NC) Employees’ Payroll Benefits (Cortland County) Two OSC audits issued in 2010 found NC employees received benefits inconsistent with Council approvals. Most of the prior control weaknesses remain and the council still has not established specific leave benefits of NC employees. As a result, auditors found seven NC employees earned 2,213 more hours of leave than employees in the collective bargaining agreements, valued at $110,500. Four NC employees were paid for 265 more hours of unused vacation leave than limits established for employees in the collective bargaining agreements, valued at $13,700. The mayor did not require department heads to track their time worked or to submit leave requests for taking time off, and the council did not approve all leave drawdown payments. 

 

Town of Hempstead – Compensatory Time (Nassau County)Town officials did not ensure comp time hours were accurately accrued and accounted for. As a result, officials do not have adequate assurance that all comp time is appropriately earned, accurately recorded and properly monitored. Town officials did not establish a policy or written procedures to ensure that comp time hours were authorized, documented and accounted for. Town officials also did not require comp time to be properly supported and approved by direct supervisors. In addition, town officials did not ensure separation payments that included a payment for unused comp time were supported. 

 

Town of Hempstead Local Development Corporation (THLDC) – Project Approval and Oversight (Nassau County) While the board properly approved and monitored projects in accordance with standard project procedures, it did not set clear and specific goals when approving projects. The board issued a total of $96.6 million of tax-exempt bonds and $1.8 million of taxable bonds during the audit period. However, THLDC officials cannot determine whether projects are meeting the intended purpose because the goals of the projects are not clearly defined in the authorizing resolutions.

 

Livonia Joint Fire District – Fire Truck Funding and Purchase (Livingston County) The board was not transparent when funding and purchasing fire apparatus. The board levied more taxes than necessary to finance annual operations and its actions hindered taxpayers’ ability to make informed decisions. The board also overestimated appropriations to accumulate more than $1.1 million in fund balance to purchase a fire truck costing more than $727,000, instead of establishing a capital reserve.

In addition, the board did not adopt fund balance, reserve or budgeting policies, along with multiyear financial and capital plans. 

 

Town of Randolph – Justice Court Operations (Cattaraugus County) The justice accurately recorded, deposited, disbursed and reported fines and fees in a timely manner. However, the justice did not ensure computerized case records were updated in an accurate and timely manner or that all closed cases were properly reported to appropriate state agencies.

SCHOOL DISTRICT AUDITS

Granville Central School District – Medicaid Reimbursements (Washington County) The district did not maximize Medicaid reimbursements by claiming for all eligible Medicaid services provided. The district also lacked adequate procedures to ensure Medicaid claims were submitted and reimbursed. Claims were not submitted for 465 eligible services totaling $18,022. Had these services been claimed, the district would have realized revenues totaling $9,011, from 50% reimbursement of eligible costs.

 

Mineola Union Free School District – Financial Condition Management (Nassau County) The board and district officials did not effectively manage the district’s financial condition. As a result, more taxes were levied than were needed to fund operations. A pattern of over budgeting developed because the board did not adjust ensuing years’ budgets based on prior years’ actual results. Therefore, general fund appropriations were consistently overestimated from 2016-17 through 2019-20 by a total of $20.7 million. Over the four-year audit period, the board consistently appropriated fund balance totaling $12.9 million that was not needed.

 

Penn Yan Central School District – Network Access Controls (Ontario County, Steuben County and Yates County) District officials did not ensure that the district’s network access controls were secure. Officials did not regularly review network user accounts and permissions to determine whether they were appropriate or needed to be disabled. As a result, auditors identified 1,094 unneeded user accounts and six user accounts with unnecessary administrator permissions. District officials also did not enter into a service level agreement with the district’s information technology (IT) service provider to clearly identify the provider’s responsibilities and services to be provided. In addition, sensitive IT control weaknesses were communicated confidentially to officials.

 

St. Regis Falls Central School District – Medicaid Reimbursements (Franklin County and St. Lawrence County) The district did not maximize Medicaid reimbursements by submitting claims for all eligible Medicaid services provided. The district also lacked adequate procedures to ensure Medicaid claims were submitted and reimbursed. Claims were not submitted for 381 eligible services totaling $23,060. Had these services been claimed, the district would have realized revenues totaling $11,530 or 50% of the reimbursement.

OTHER REPORTS

Former Village of Chatham Clerk-Treasurer Pleads Guilty to Defrauding Village

New York State Comptroller Thomas P. DiNapoli, Columbia County District Attorney Paul Czajka, and the New York State Police announced that Barbara Henry, the Village of Chatham’s former clerk-treasurer, has pleaded guilty to attempted official misconduct for unlawfully waiving her own health insurance premiums at the town’s expense.

“Ms. Henry took advantage of her public position to have the taxpayers fully fund her insurance costs,” said DiNapoli. “This kind of corruption drives up costs and erodes the public trust. Those who abuse the system will be caught and brought to justice. I thank District Attorney Paul Czajka and the New York State Police for their partnership in safeguarding public funds.”

“On behalf of the citizens and taxpayers of Chatham and Columbia County, I thank Comptroller Thomas DiNapoli, Chief Joseph Fiore and their team of investigators and auditors, as well as Sr. Inv. Eric Barnes and his State Police investigators,” DA Czajka said. “In particular, I commend Comptroller’s Investigator Candace Burnham, State Police Investigator Mathew Reilly and Deputy Chief ADA Ryan Carty for their hard work and dedication in this complex investigation. I strongly believe that, if there is one arm of state government that pays for itself by discovering financial misdeeds and deterring thefts, it is this investigative unit of the Comptroller’s office. I also note that Mayor John Howe, although not in office while the crimes were committed, took the lead in ensuring that all village employees cooperated fully.”

Henry, 59, of Chatham paid $3,586 in restitution for scamming the village health insurance premiums and stealing from her other employer Cadmus Lifesharing Association, a nonprofit organization based out of Massachusetts.

The joint investigation found that from April 2017 to August 2018, Henry used her position to unlawfully waive her own health insurance premiums, causing the village to pay Henry’s portion of health insurance. Henry was responsible for paying 50% of her health insurance while the village was responsible for the other 50%. Henry used her position to waive the cost to herself. She was employed by the village from late 2012 until she resigned in August of 2018.

Henry pleaded guilty before Judge J. Borgia-Forster in Chatham Town Court who also imposed a $250 fine in addition to the full restitution.

This is the second criminal conviction of a village official stemming from the joint investigation. In the first, and separate case, former Police Chief Peter Volkmann was sentenced on July 19, 2021 to pay nearly $93,000 in restitution after his felony guilty plea to grand larceny in the fourth degree.

 

Fiscal stress scores of municipalities reported by New York State's Comptroller

On September 22, 2021, New York State's Comptroller Thomas P. DiNapoli reported that thirty local governments in New York State ended 2020 in some form of fiscal stress. 

[Click on the text highlighted inBLUE below to access the full reports.]

The communities were identified by the Comptroller’s Fiscal Stress Monitoring System (FSMS). [In January 2021 the Comptroller issued fiscal stress scores for school districts and found 31 school districts in some level of fiscal stress.] .

The Comptroller releases fiscal stress scores on municipalities (excluding New York City) twice a year. The latest round of scores announced in September 22, 2021, identified 19 local governments  designated in fiscal stress, including six counties, four cities, and nine towns. This release is based on financial information of local governments operating on a calendar year basis (Jan. 1 – Dec. 31) for 2020 and covers all counties and towns, 44 cities, and 10 villages. In April 2021 DiNapoli announced that 11 local governments with non-calendar fiscal yearswere in stress.

“New York’s local governments have overcome some major fiscal hurdles during the COVID-19 pandemic,” Comptroller DiNapoli said, explaining that "Federal assistance, the restoration of state aid and resurging revenue have provided them much needed relief." However, cautioned the Comptroller, those designated as stressed are less likely to have the flexibility to adapt to fiscal challenges long term, noting that "local officials must budget and plan carefully to avoid fiscal stress and manage their communities through the uncertainties created by the pandemic.” 

In this latest round, the city of Poughkeepsie (fiscal stress score of 78.3), the city of Niagara Falls (72.1), and the town of Caneadea (65.4) are in the highest-ranking designation of “significant stress.”  The counties of Suffolk and Westchester, the city of Glen Cove and the town of Yates were in “moderate stress.”

Those designated as being “susceptible to fiscal stress” are the counties of Broome, Monroe, Nassau and Oneida, the towns of Centerville, Clarkstown, Colonie, Fort Covington, Pulteney, Sherman and Southport, and the city of Albany.

Of the 30 total governments in a fiscal stress designation for 2020, 17 were also in some form of fiscal stress in 2019. Four cities that were in “significant fiscal stress” in both years are Niagara Falls, Poughkeepsie, Amsterdam and Long Beach.

The Comptroller’s Fiscal Stress Monitoring System was implemented in 2013 to keep the public informed about the factors impacting local governments’ financial health. The system evaluates local governments on financial indicators including year-end fund balance, cash-on-hand, short-term borrowing, fixed costs and patterns of operating deficits and creates fiscal stress scores.

The system also evaluates information such as population trends, poverty and unemployment in order to establish a separate “environmental” score for each municipality which can be used to help describe the context in which these local governments operate.

The Comptroller’s report also found:

• In response to COVID-19, many local officials made difficult mid-year 2020 budget decisions about how best to meet their community’s service needs with reduced or less predictable revenues, while protecting public health and minimizing cuts to their own workforce.
• Rebounding monthly sales tax collections in much of the state supported local governments’ bottom lines, with many counties outside of New York City seeing only slight losses for 2020 overall compared with 2019, and collections in some counties even growing for the year.
• 173 local governments did not receive a fiscal stress score for fiscal year ending 2020. The vast majority of these (169) did not file in time to be scored, including the cities of Beacon, Dunkirk, Ithaca, Johnstown, Little Falls, Mechanicville, Mount Vernon, Rensselaer and Salamanca; and Greene and Ontario counties.

Lists

Municipalities in Stress for Fiscal Year Ending 2020

Municipalities Who Did Not File or Designated Inconclusive

Excel Spreadsheet

Detailed List of All Municipalities in State and Fiscal Stress Scores

Report

Fiscal Stress Monitoring System Municipalities: Fiscal Year 2020 Results

School district directed to resume reimbursing its retirees' Medicare Part B surcharges

Pursuant to collective bargaining agreements [CBAs] between the School District [District] and the Congress of Teacher [Congress], an association representing district employees, the District agreed to provide health care benefits for active and retired employees and their spouses and dependents. 

Retired employees over age 65, however, were required to enroll in a Medicare Part B program [Part B] and the district reimbursed retirees the cost of Part B coverage.

Some retirees, based upon their household income, were subject to a surcharge in addition to the standard Part B premium. This surcharge was an income-related monthly adjustment amount and referred to as the "IRMAA". Prior to August 2018, the district reimbursed retirees for IRMAA surcharges in addition to their standard Medicare premium payments.

In response to the District's informing retirees that it would no longer reimburse them for IRMAA surcharges, certain retirees [Plaintiffs] commenced a CPLR article 78 proceeding seeking [1] a court order annulling the District's decision, contending that the District's discontinuing such reimbursements violated Chapter 729 of the Laws of 1994 (as amended by Chapter 22 of the Laws of 2007), the State's Retiree Health Insurance Moratorium Act [Act]* and [2] a court order reinstating the reimbursements.

The Supreme Court agreed that the District's discontinuation of its reimbursements of IRMAA surcharges violated the Act, granted the Plaintiff's petition, and directed the District to reinstate providing the reimbursement, plus making appropriate retroactive reimbursements. The District appealed.

Explaining that Act sets "a minimum baseline or 'floor' for retiree health benefits" which is "measured by the health benefits being received by active employees," the Appellate Division sustained the lower court's ruling. In other words, the Act does not permit an employer to whom the statute applies to provide its retirees with lesser health insurance benefits than it provides its active employees.

Citing Matter of Baker v Board of Educ., 29 AD3d 574, the Appellate Division opined that a school district may not diminish retirees' health insurance benefits unless it makes "a corresponding diminution in the health insurance benefits or contributions of active employees." 

In the words of the court, the purpose of the Act was to protect the rights of retirees who "are not represented in the collective bargaining process, [and] are powerless to stop unilateral depreciation or even elimination of health insurance benefits once the contract under which they retired has expired"**

It was undisputed both that the CBAs between the District and the Association did not address Part B or IRMAA reimbursements and that the district provided such reimbursements, even if, as it claims, it made such reimbursements inconsistently. 

The parties, said the court, conceded that the reimbursements were "retiree health insurance benefits that were voluntarily conferred as a matter of school district policy." Accordingly, the Appellate Division held that Supreme Court "correctly concluded that the discontinuation of IRMAA reimbursements was a matter subject to the moratorium statute."

Additionally, the Appellate Division noted reimbursing retirees for Medicare Part B premiums is not an improper gift of public funds in violation of Article VIII, §1, of the New York State Constitution," citing Baker v Board of Education, 29 AD3d 574.

The Appellate Division sustained the Supreme Court ruling, finding it to have correctly determined that the District's discontinuation of IRMAA reimbursements violated the Act and thus had properly granted the Plaintiffs' petition.

* The purpose of the moratorium statute was to tie retiree benefits to active employee benefits so that retirees could benefit from the collective bargaining power of the active employees.

** See Matter of Bryant v Board of Educ., Chenango Forks Cent. School Dist., 21 AD3d 1134, quoting Assembly Memorandum in Support of Bill, 1996 McKinney's Session Laws of New York at 2050.

Click HERE to access the Appellate Division's decision.

Fraudulent letter scheme impersonating New York State's Secretary of State reported

On September 21, 2021, the New York State Department of State and the Division of Consumer Protection issued a press release warning of a fraudulent letter scheme claiming the recipient is entitled to receive a large payment being held by the Department of State to settle debts relating to the sale of timeshares.

The scheme, which uses a forged signature of New York Secretary of State Rossana Rosado and the New York State seal, has been referred to the New York State Attorney General for investigation. Anyone who has received this or a similar letter is asked to contact the New York State Attorney General’s Real Estate Enforcement Unit, New York State Office of the Attorney General, 28 Liberty Street, New York, NY 10005.

To help protect against these types of scams, the Division of Consumer Protection  recommends the following:

1. Exercise caution with all communications you receive, including those that appear to be from a trusted entity.

2. Inspect the sender’s information to confirm the message was generated from a legitimate source – be suspicious if the reply to address is different from the sending address.

3. Independently verify the entity’s contact information through an online search engine.

4. Consider calling the sender at a known good number, not listed within the communication, to confirm they sent the communication.

For more consumer protection information, call the Division of Consumer ProtectionHelpline at 800-697-1220, Monday through Friday, 8:30am-4:30pm or visit the Division of Consumer Protection website at https://dos.ny.gov/consumer-protection. 

The Division can also be reached via Twitter at @NYSConsumer or Facebook at www.facebook.com/nysconsumer

 

Applying the Doctrine of Judicial Estoppel

In its decision in 12 New St., LLC v National Wine & Spirits, Inc., 196 3d 883, the Appellate Division, Third Department, said its "longstanding doctrine of judicial estoppel has been succinctly stated as follows: 

Where a party assumes a position in one legal [action or] proceeding and succeeds in maintaining that position, that party may not subsequently assume a contrary position in a second [action or] proceeding because its interests have changed. 

In order for the doctrine of judicial estoppel to apply, there must be a showing that the party taking the inconsistent position had benefited from the determination in the prior action or proceeding based upon the position it advanced there and "For the doctrine to apply, there must be a final determination endorsing the party's inconsistent position in the prior proceeding."

Click HERE to access the Appellate Division's decision in 12 New Street, LLC.

Also, click HERE  to access Matter of Roberts v New York City Office of Collective Bargaining, 2010 NY Slip Op 32953(U), [Not selected for publication in the Official Reports].

ABOUT A TEACHER

ABOUT A TEACHER is an intimate film, filmed by some of the educator's former students, candidly takes the viewer through the personal journey of a new New York City inner-city public high school film teacher. 

Inspired by the filmmaker’s real-life experiences as an inner-city high school film teacher, Hanan (played by Dov Tiefenbach) enters the profession oblivious to the actual demands of teaching, and unaware of his own shortcomings and biases. 

Click HERE for more information about this realistic film.

Audits and reports issued during the week ending September 18, 2021 by the New York State Comptroller

New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending September 18, 2021

Office of Alcoholism and Substance Abuse Services: Oversight of Contract Expenditures of Palladia Inc. (2020-S-5) In 2014, OASAS entered into a five-year $45.6 million contract with Palladia, under which Palladia would provide drug and addiction treatment services. Auditors found OASAS is not effectively monitoring the expenses reported by Palladia to ensure that reimbursed claims are allowable, supported and program related. For the three fiscal years ended June 30, 2018, auditors identified $2,508,682 in costs that did not comply with the requirements for reimbursement. 

Office of Children and Family Services (OCFS): Oversight of Direct Placement of Children (Follow-Up) (2021-F-6) An audit issued in March 2020 found that OCFS did not maintain adequate oversight of direct placement to ensure that Local Departments of Social Service (Local Districts) comply with applicable laws and regulations and that children are placed in safe environments. OCFS also had not developed the same type of centralized standards, policies, or procedures for Local Districts to follow in supervising all direct placement cases as it has for similar child welfare services, such as foster care. In a follow-up, auditors determined OCFS officials have made limited progress in addressing the issues identified in the initial report. 

Office of General Services (OGS): Compliance with Executive Order 95 (Open Data) (Follow-Up) (2021-F-12) An audit released in April 2020 found OGS had taken steps to meet the requirements of EO 95; however, certain aspects of the order were not fully addressed. OGS did not identify the total population of publishable state data that it maintains. Therefore, there was limited assurance OGS provided a complete catalogue of its publishable state data or accompanying schedules for making that data public, as required. In a follow-up, auditors found OGS made limited progress in addressing the problems identified in the initial audit report. 

Department of Health (DOH): Improper Fee-for-Service (FFS) Payments for Services Covered by Managed Long-Term Care (MLTC) Plans (Follow-Up) (2021-F-4) An audit issued in January 2020 identified $16.4 million in improper Medicaid FFS payments for MLTC covered services. Of these overpayments, $15.6 million was paid because DOH did not configure eMedNY payment system edits and MLTC benefit packages correctly, so eMedNY did not identify certain services as the responsibility of the MLTC plan. The remaining $877,000 was improperly paid because, at the time eMedNY adjudicated the claim, the recipient was not enrolled in MLTC, but was retroactively enrolled at a later date. In a follow-up, auditors found DOH made some progress in addressing the problems identified in the initial audit report; however, further actions are still needed.  

Homes and Community Renewal - Division of Housing and Community Renewal: Controls Over Federally Funded Programs and Maximization of Federal Funding (2020-S-48)Generally, the division has established controls to ensure the Weatherization Assistance Program meets federal reimbursement documentation requirements and that the division receives federal reimbursements on time and in a manner that recovers all funds. However, the division lost $120,475 in federal funding during the audit period because it was not expended by program deadlines, primarily due to a decrease in production caused by the COVID-19 pandemic. As of Dec. 31, 2020, the division had until March 31, 2022 to obligate and expend $10,925,486 or it will be returned to the U.S. Department of Energy. 

Public Service Commission (PSC): Enforcement of Commission Orders and Other Agreements (Follow-Up) (2021-F-5) An audit issued in March 2020 found PSC’s Department of Public Service does not always adequately monitor compliance with order conditions – and in some cases even lacks the equipment necessary to do so. Orders are, at times, ambiguous and lack time frames for completion, interim performance measures, and consequences for non-compliance, making enforcement difficult and inconsistent. In a follow-up, auditors found department officials made significant progress in addressing the issues identified in the initial audit report. 

Department of State: Compliance with Executive Order 95 (Open Data) (Follow-Up) (2021-F-11) An audit released in April 2020 found the department had generally complied with the requirements of EO 95, incorporating compliance with EO 95 into its core business functions and continued to identify new data sets to add to Open Data. However, the department did not identify the total population of publishable State data that it maintains. Additionally, the audit found some problems with the usability of some of the department’s data sets on Open Data. In a follow-up, auditors determined the department has made progress in addressing the problems identified in the initial audit report. 

Department of Taxation and Finance: Efforts to Collect Delinquent Taxes (2019-S-61) For a significant number of the delinquent tax assessments reviewed, auditors were unable to determine, based on documentation, that the department took adequate collection actions prior to completing or closing cases for one of the five collection steps tested: using applicable search tools to identify taxpayer resources that might be pursued to satisfy the debt. Auditors recommended the department improve documentation for each relevant assessment to affirm which actions are applicable and which actions staff take in their collection activities; and take steps to ensure compliance with policies and procedures that address abatement decisions, and, when needed, document the rationale for decisions.