Selected reports and information published by New York State's Comptroller Thomas P. DiNapoli during the week ending February 8, 2014

Selected reports and information published by New York State's Comptroller Thomas P. DiNapoli during the week ending February 8, 2014

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Comptroller DiNapoli Releases Municipal Audits

New York State Comptroller Thomas P. DiNapoli on Tuesday, February 4, 2014, announced his office completed audits of

the Village of Allegany;

the Baldwin Public Library;

the Town of Charleston;

the Comsewogue Public Library;

the Endwell Fire District;

the Lily Dale Volunteer Fire Company;

the Town of Oneonta Fire District; and

the Warsaw Fire Department

DiNapoli: Funds Dedicated for Highway & Bridge Capital Projects Continue to be Diverted for Operating and Debt Costs

Money in the Dedicated Highway and Bridge Trust Fund continues to be diverted for non–capital purposes, leaving critical highway and bridge projects at increased risk as the state faces fiscal challenges and shrinking debt capacity, according to a reportissued on Wednesday, February 5, 2014, by New York State Comptroller Thomas P. DiNapoli.

DiNapoli: ‘Early Warning’ System Finds 15 Villages in Fiscal Stress

State Comptroller Thomas P. DiNapoli’s Fiscal Stress Monitoring System has identified 15 villages in New York in some level of fiscal stress. DiNapoli’s office evaluated 535 villages with fiscal years ending on May 31, 2013.

DiNapoli: Audit Cites East Clinton Fire District for Improper Gifts

Officials in Dutchess County’s East Clinton Fire District improperly paid nearly $35,000 in personal expenses for members, including rent, cable television and college fees, according to an audit released on Tuesday, February 4, 2014, by State Comptroller Thomas P. DiNapoli. The findings of the Comptroller’s audit and investigation were referred to Dutchess County District Attorney William V. Grady.

DiNapoli, Stringer Lead Investors Calling on Olympic Sponsors to End Their Silence, Defend Russian LGBT Rights

State Comptroller Thomas P. DiNapoli, as trustee of the $160.7 billion New York State Common Retirement Fund, along with New York City Comptroller Scott Stringer and a coalition of 19 investors, on Wednesday, February 5, 2014 released letterswritten to four major corporate sponsors of the upcoming Winter Olympic Games in Sochi, Russia that failed to respond to an earlier request they use their influence to ensure the protection of the human rights of Russian citizens, as well as athletes and visitors to the Olympics.
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State employer entitled to reimbursement by the Workers’ Compensation Board for personal leave credits used by State employee injured on the job

State employer entitled to reimbursement by the Workers’ Compensation Board for personal leave credits used by State employee injured on the job

2014 NY Slip Op 00153, Appellate Division, Third Department

A guard [Guard] at a State psychiatric center [Employer] suffered a work-related injury and his claim for workers' compensation benefits was approved. Guard was awarded benefits for the period July 2 until September 7. During that period Guard received his full salary, which included payment for five days of absence charged to his personal leave credits.

The Employer then requested reimbursement at the workers' compensation benefit rate for the advance payment of compensation* it paid to Guard during his disability, including for the time Guard charged against his personal leave credits. The Workers' Compensation Board ultimately ruled that Employer was not entitled to reimbursement related to Guard's use of personal leave credits and Employer appealed.

Here, said the court, personal leave credits, in contrast to sick leave credits, may not be accrued from year to year or converted into cash or retirement credits. In the opinion of the Appellate Division, Guard’s use of his personal leave time during his absence for disability did not result in a permanent benefit to Employer or a net detriment to Guard as Guard did not surrender "valuable vested rights" in return for the payment of full wages.

Rather, said the court, the denial of reimbursement for Employer’s payments related to personal leave credits would result in Guard receiving both full wages and compensation benefits for the time in question. Such a result is disfavored and requires that Employer be reimbursed for the personnel leave credits used by Guard.

The Appellate Division reversed the Board’s decision and remitted the matter  “to the Workers' Compensation Board for further proceedings not inconsistent with this Court's decision.”

* Workers' Compensation Law §25(4)(a) provides that, "[i]f the employer has made advance payments of compensation, or has made payments to an employee in like manner as wages during any period of disability, [the employer] shall be entitled to be reimbursed out of an unpaid installment or installments of compensation due." Citing Houda v Niagara Frontier Hockey, 16 AD3d 926, the decision notes that, "[a]n employer can be reimbursed for compensation paid to a claimant even if that compensation was paid in accordance with a contract or a collective bargaining agreement" and reimbursement must be awarded to the employer "unless such reimbursement would achieve a disproportionate result, either to the employer or employee"

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2014/2014_00153.htm
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Grounds for vacating the arbitrator’s award

Grounds for vacating the arbitrator’s award

Sheriff Officers Assn., Inc. v Nassau County, 2014 NY Slip Op 00108, Appellate Division, Second Department

The Sheriff Officers Association, Inc., on behalf of one of its members, [Member], filed a grievance with the County on the ground that the County violated the terms of the parties' collective bargaining agreement when it "unilaterally sent Member to an Independent Medical Examiner" and asked him to opine as to whether Member’s medical condition prevented Member from returning to full-time restricted duty.

The County denied the grievance and the Association demanded that the matter be submitted to arbitration.

The arbitrator determined that the County properly directed that Member be examined by the independent medical examiner since Member had, in effect and by her conduct, disputed certain portions of a police surgeon's report relating to her ability to work full time. The arbitrator further determined that the County properly asked the independent medical examiner to opine as to whether Member was capable of working full-time restricted duty, since this issue comprised the parties' dispute.

The arbitrator concluded that the County had not violated the terms of the collective bargaining agreement and upheld the County's denial of the Association's grievance.

The Association then filed a petition pursuant to Article 75 of the CPLR article 75 seeking to vacate the arbitrator's determination on the ground that the arbitrator exceeded his authority in concluding that the County had not violated the terms of the collective bargaining agreement.

Although Supreme Court had concluded that the arbitrator had exceeded his authority, granting the Association's petition and vacated the arbitrator's determination the Appellate Division reversed the lower court’s decision, explaining that "[J]udicial review of arbitration awards is extremely limited" whereby "the court shall not consider whether the claim with respect to which arbitration is sought is tenable, or otherwise pass upon the merits of the dispute." Accordingly, said the court, "An arbitration award must be upheld when the arbitrator offer[s] even a barely colorable justification for the outcome reached"

Further, the Appellate Division noted that the Court of Appeals has recognized "three narrow grounds that may form the basis for vacating an arbitrator's award: [1] that it violates public policy; [2] that it is irrational, or [3] that it clearly exceeds a specifically enumerated limitation on the arbitrator's power" 

The Appellate Division said that "as relevant here, an arbitrator exceeds his or her power if the award 'g[ives] a completely irrational construction to the provisions in dispute and, in effect, ma[kes] a new contract for the parties.'"

The Appellate Division found that in this instance the arbitrator had not exceed his power in concluding that the County had not violated the terms of the collective bargaining agreement. Under the terms of the collective bargaining agreement,said the court, the arbitrator was permitted to resolve a grievance, which is defined as "any dispute . . . with respect to the meaning, interpretation or application of a provision of [the] Agreement." Thus the arbitrator had the authority to determine whether the County's actions violated the terms of the collective bargaining agreement, and his determination of that issue did not exceed a specifically enumerated limitation on his power.

As to the Association’s argument that the arbitrator misinterpreted the terms of the collective bargaining agreement, the court said that such an argument constituted a challenge to the merits of the arbitrator's determination.

In that regard, finding that the arbitrator's determination was not "completely irrational" the Appellate Division held that the Association’s challenge to the merits of the arbitrator's determination did not provide a ground for vacating that determination.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2014/2014_00108.htm
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Employer may not discontinue a firefighter’s GML §207-a(1) benefits without first providing the firefighter with an administrative hearing

Employer may not discontinue a firefighter’s GML §207-a(1) benefits without first providing the firefighter with an administrative hearing

2014 NY Slip Op 00408, Appellate Division, Third Department

A firefighter (Firefighter) injured his lower and about one and one-half years later he stopped working due to his injury. His employer (Village) then granted him disability benefits pursuant to General Municipal Law §207-a (1).

About six moths later Village told Firefighter that it was discontinuing his disability benefits. Firefighter appealed that decision, eventually resulting in a determination that he was entitled to General Municipal Law §207-a(1) benefits. While his administrative appeal was pending*Firefighter was granted performance-of-duty disability retirement benefits pursuant to Retirement and Social Security Law §363-c and retired.

The Village stopped paying Firefighter any benefits. Including “supplemental benefits” equal to the difference between his retirement allowance and his “full salary” as a firefighter. Firefighter asked Village pay him such supplemental disability benefits as authorized by General Municipal Law §207-a(2).

Ultimately the Appellate Division was presented with the issue: Does General Municipal Law §207-a provides one unified set of benefits, or are different and separate benefits are provided for under the different subdivisions of that statute.

The Appellate Division ruled that although the subdivisions provide for benefits that are different based on the qualifications, amounts and standards or requirements to obtain or retain them, the statute intends to provide for one unified set of benefits for the payment of salary to firefighters injured in the performance of duty.

In the words of the court: “Despite the differences between the subdivisions, the end result under their respective different scenarios is for the injured firefighter to receive his or her full regular salary.” Payment of the individual’s full regular salary is the benefit regardless of whether the firefighter is temporarily unable to work (General Municipal Law §207-a(1)], permanently unable to work and retired on that basis (General Municipal Law §207-a(2)], or unable to perform his or her regular duties but able to perform specified types of light duty (General Municipal Law §207-a(3)].”**

However, the Appellate Division said that although the benefits provided for in General Municipal Law §207-a are one unified benefit, an employer is not collaterally estopped from denying or considering if the firefighter is qualified to receive permanent supplemental benefits pursuant to General Municipal Law §207-a(2) based on the prior determination that he or she was entitled to temporary benefits under General Municipal Law §207-a(1).

The court explained that the standards and requirements to qualify for the benefits provided for under these two subdivisions are different. Subdivision (1) sets out the benefits to be paid to firefighters injured in the performance of duty until the municipality's health authorities certify that he or she is recovered and able to perform regular duties of his or her position.

In contrast, General Municipal Law §207-a(2) provides that in the event the firefighter is granted a specified type of disability retirement allowance as a result of an injury incurred in the performance of duties his or her employer no longer is required to pay the firefighter the full amount of his or her regular salary or wages but is required to pay the firefighter the difference between “the amounts received under such allowance or pension and the amount of his or her regular salary or wages until such time as he or she shall have attained the [relevant] mandatory service retirement age.”***

However, said the Appellate Division, as the benefits under General Municipal Law §207-a are one unified benefit, Supreme Court properly determined that Village could not terminate Firefighter’s benefits without a hearing, citing Park v Kapica, 8 NY3 302.

As the Court of Appeals held in Park, such disabled firefighters have a property interest in disability payments pursuant to General Municipal Law §207-a, giving rise to procedural due process protection before those payments may be terminated.

Here, said the Appellate Division, Firefighter submitted evidence of permanent disability related to his work-related injury, raising "a genuine dispute on operative facts" such that he is entitled to a hearing on the deprivation of his benefits by the Village and since Firefighter was already receiving benefits under the statute, he is entitled to due process "before those payments are terminated," he is entitled to a continuation of benefits pending the hearing.

* The decision notes that “It appears that (Village) later appointed a hearing officer and a hearing has been held, but no decision has yet been rendered.”

** Such benefits, however, may also be discontinued in the event the firefighter refuses to perform light duty work after the employer's health authorities determine that the firefighter is capable of performing such light duty.

*** N.B. GML 207-a(4-a) provides that “ Any benefit payable pursuant to subdivision two of this section to a person who is granted retirement for disability incurred in performance of duty pursuant to section three hundred sixty-three-c of the retirement and social security law shall be reduced by the amount of the benefits that are finally determined payable under the workers' compensation law by reason of accidental disability.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2014/2014_00408.htm

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General Municipal Law§§ 207-a and 207-c- a 1098 page e-book focusing on administering General Municipal Law Sections 207-a/207-c and providing benefits thereunder and other disability retirement issues is available from the Public Employment Law Press. Click on http://section207.blogspot.com/ for additional information about this electronic reference manual.

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The Warren M. Anderson Breakfast Series Seminar’s Municipal Finance session is scheduled for February 11, 2014

The Warren M. Anderson Breakfast Series Seminar’s Municipal Finance session is scheduled for February 11, 2014

Source: Government Law Center, Albany Law School

The Albany Law School’s Government Law Center will host the next 2014 Annual Warren M. Anderson Breakfast Seminar Series, a nonpartisan hour-long breakfast program, on February 11 from 8-9 a.m. in the Assembly Parlor, at the State Capitol, 3rd FL. The program continues to be offered free of charge, but space is limited.

The speaker is New York State Comptroller Thomas P. DiNapoli who will discuss Municipal Finance.

For those interested, each seminar is accredited for one hour of transitional and non-transitional CLE credit in the area of “Professional Practice.”

To register or to obtain more information, contact Ms. Amy Gunnells at agunn@albanylaw.eduor telephone 518-445-2329.