Selected reports and information published by New York State's Comptroller Thomas P. DiNapoli during the week ending April 25, 2015

Selected reports and information published by New York State's Comptroller Thomas P. DiNapoli during the week ending April 25, 2015

Click on text highlighted in color to access the full report

New York State Comptroller Thomas P. DiNapoli announced office released audits of State Department and Agencies have been issued:

Department of Motor Vehicles

Posted on the Internet at: http://www.osc.state.ny.us/audits/allaudits/093015/15s7.pdf

Department of Transportation

Posted on the Internet at: http://www.osc.state.ny.us/audits/allaudits/093015/14s52.pdf

and the

Workers’ Compensation Board

Posted on the Internet at: http://www.osc.state.ny.us/audits/allaudits/093015/14s43.pdf

New York State Comptroller Thomas P. DiNapoli  announced his office completed audits of the

Town of Champion Great Bend Fire District – Controls Over Financial Operations (Jefferson County)
The district has not submitted the required annual financial reports to the Office of State Comptroller for the 2011 through 2013 fiscal years. The district did not submit its tax levy limit calculations for 2015 or the three prior years. Auditors calculated the levy limit for 2015 and found the district’s proposed 2015 tax levy exceeded the statutory limit by $4,394 and the board did not pass a resolution to override the limit.

Chenango County – Departmental Cash Receipts (2015M-21)
County officials have ensured cash receipts are properly collected, recorded and deposited. Department officials have implemented effective controls including issuing duplicate receipts, segregating key financial duties, performing monthly reconciliations and cross-checking their records with the monthly treasurer’s report.

Jefferson County Soil and Water Conservation District – Internal Controls Over Selected Financial Operations (2014M-171)

The board was not provided with the necessary financial reports and information to properly oversee operating and grant activities or to develop realistic or structurally balanced budgets. As a result, the district borrowed $669,000 from grant funds to help pay operating costs.

Village of Woodsburgh – Claims Processing and Information Technology (Nassau County)
The board did not perform an effective claims audit to ensure transactions were properly authorized and approved or claims were for proper village purposes. The board also did not adopt a comprehensive IT policy or establish procedures addressing crucial aspects of IT security.


New York State Comptroller Thomas P. DiNapoli today announced his office completed audits of the

Campbell-Savona Central School District – Budget Review (Steuben County)
The significant revenue and expenditure projections in the tentative budget are reasonable. The district consistently appropriates fund balance that is not needed to fund operations. Two of the district’s reserves totaling $1.14 million appear to be overfunded. The district’s tentative budget complies with the property tax levy limit.

Cortland City School District – Budget Review (Cortland County)
The district has overestimated appropriations for payroll, health insurance, retirement, debt and utilities by $3.2 million. After the district’s planned use of $500,000 in fund balance, the remaining unassigned fund balance is only $200,000, or 0.4 percent, of the ensuing year’s appropriations. The district’s preliminary budget complies with the tax levy limit.

Fort Edward Union Free School District – Financial Condition (Washington County)
Although the board adopted reasonable budgets that included realistic estimates based on historical or known trends, the district relied on the appropriation of fund balance to finance recurring expenditures and, as a result, the budgets were not structurally balanced. As of June 30, 2014, the district reported an unrestricted fund balance that totaled $35,463, or .33 percent, of the ensuing year’s budgeted appropriations. District officials have developed a multiyear financial plan to address current and long-term financial trends.
 
Glens Falls Common School District – Financial Condition (Warren County)
The board did not adopt structurally balanced budgets that funded recurring expenditures with recurring revenues for the general fund for 2012-13, 2013-14 or 2014-15 fiscal years. Furthermore, the district’s general fund operating cash balance decreased by approximately $370,000 in one year. As a result, the district had to issue a tax anticipation note to meet cash flow needs during the 2014-15 fiscal year.

West Seneca Central School District – Financial Condition (Erie County)
The district had no operating cash on hand and very little fund balance at the end of 2013-14 fiscal year. The district incurred significant operating deficits in fiscal years 2010-11 through 2012-13. In addition, the district issues short-term debt to provide temporary cash flow and has improperly used a total of $7.5 million in reserve fund cash to help with cash flow in fiscal years 2012-13 and 2013-14.



Audit finds an additional $150,000 was stolen by an official of the Town of Beekman

Former Beekman Comptroller Frederick D. Knapp Jr. pleaded guilty to grand larceny in the second degree last Friday in Dutchess County Court after an audit and investigation by State Comptroller Thomas P. DiNapoli uncovered a second theft of $150,000 in town funds, following an earlier admission by Knapp of stealing $390,000 while in office.

Posted on the Internet at: http://www.osc.state.ny.us/localgov/audits/towns/2015/beekman.pdf

Fiscal Stress Scores for 17 cities released 
State Comptroller Thomas P. DiNapoli issued fiscal stress scores  for the 17 cities in New York that have fiscal years ending between March 31 and July 31.

Posted on the Internet at:: http://www.osc.state.ny.us/localgov/fiscalmonitoring/villagescities_stressed2014.htm

To search for a specific local government’s fiscal stress scores, visit:
http://wwe1.osc.state.ny.us/localgov/fiscalmonitoring/fsms.cfm
 

For an overview of Comptroller DiNapoli’s Fiscal Monitoring System, visit:
http://www.osc.state.ny.us/localgov/fiscalmonitoring/index.htm

Audits find more than $500 Million in Medicare waste

State Comptroller Thomas P. DiNapoli’s audits identified a total of $513 million in improper Medicaid payments and untapped revenue opportunities over a four-year period, according to a report released Wednesday. Auditors identified another $361 million in questionable transactions that will require further review and actions to prevent overpayments or recover costs.

Posted on the Internet at: http://www.osc.state.ny.us/audits/15d1.pdf

Eleven individuals nominated, recommended for appointment or appointed to Governor Cuomo’s administration

Eleven individuals nominated, recommended for appointment or appointed to Governor Cuomo’s administration

Source: Office of the Governor

On April 23, 2015Governor Andrew M. Cuomo announced the following nominations for appointment, recommendations for appointment and individuals appointed to his administration with the Departments and Agencies indicated.

Gerrard P. Bushell will be nominated to serve as President and Chief Executive Officer of the Dormitory Authority of the State of New York. Mr. Bushell is an accomplished investment advisor who counsels some of the nation’s leading institutional investors on their private and public investment strategies. He is currently a Senior Relationship Advisor in BNY Mellon's alternative and traditional investment management businesses. Prior to joining BNY Mellon, he held a number of Senior Advisory roles, including Director in the Client and Partner Group at Kohlberg Kravis Roberts & Co. (KKR), Managing Director in Business Development at Arden Asset Management and Head of Institutional Sales at the Legg Mason affiliate ClearBridge Advisors (formerly Citi Asset Management). Gerrard has deep experience working in New York State Government, having served as a Senior Officer to New York State Comptroller H. Carl McCall, a sole trustee of the New York State Common Retirement Fund and a leading institutional investor. Mr. Bushell is a graduate of Columbia University, where he received a B.A., M.A. and Ph.D. in Political Sciences. This nomination requires Senate confirmation.

Jerry Boone will be nominated to serve as Commissioner of the Department of Taxation and Finance. His nomination replaces that of Kenneth Adams, who will return to the private sector in June. Mr. Boone currently serves as President and Commissioner of the Civil Service Commission, overseeing New York’s workforce as principal human resources partner and employee benefits manager for the Executive Branch of state government, which employs 150,000 people. He previously served as Managing Principal of Boone Consulting and, prior, was President and Founder of Pride Properties, LLC, owning a portfolio of rental and company-financed properties in the Mid South. He held a number of roles at Caesars Entertainment, Inc./Harrah’s Entertainment, Inc., from legal counsel to head of gaming operations at a major subsidiary, culminating in the role of corporate Senior Vice President and HR, Integration & Internal Communication Leader. He also served as Commissioner of the New Jersey Casino Reinvestment Development Authority and Solicitor General in the New York State Attorney General’s Office. Mr. Boone has a B.A. from Columbia University and a J.D. from Boston College Law School. This nomination requires Senate confirmation.

Sabrina Ty has been recommended to serve as President and CEO of the Environmental Facilities Corporation. This recommendation must be approved by the EFC Board of Directors. Ms. Ty most recently served as Special Counsel to the Commissioner in the Office of General Services, where she oversaw several of the Governor’s Enterprise initiatives for achieving savings, supervised the implementation of the Service-Disabled Veteran-Owned Business Program and managed the agency’s MWBE program. She previously served as Governor Cuomo’s Deputy Secretary for Legislative Affairs and, prior, held a number of positions for the New York State Assembly, culminating in Legislative Counsel to the Speaker. Ms. Ty has a B.A. from McGill University in Montreal and a J.D. from Albany Law School.

Margaret A. Tobin has been appointed Senior Vice President of Development for the Jacob K. Javits Convention Center in New York City. Ms. Tobin most recently served as Chief Financial Officer of Empire State Development, where she oversaw the $1.6 billion bond financing of World Trade Center 3. Ms. Tobin joined the Cuomo administration in 2012 as Executive Director of the New York Works Task Force, leading the Governor’s initiative to overhaul the capital investment process for New York State. In that role she led the development of New York State’s first-ever, 10-year, Statewide Capital Plan, coordinating $174 billion in capital investment across 47 agencies and authorities, and oversaw more than 600 projects valued at more than $1.5 billion, while achieving a 100% on-time, on-budget performance. During her distinguished career, Ms. Tobin has served as a Principal at Cherry Tree Development, as Executive Vice President of Development for Thor Equities, a Vice President of Development at Vornado Realty Trust, Executive Vice President and Chief Financial Officer for the Hudson River Park Conservancy, and Director of Economic Development for the Mayor’s Office of Finance & Economic Development. Ms. Tobin earned a B.A. from Vassar College and an M.B.A. from Stanford Business School.

Axel Bernabe has been appointed Assistant Counsel to the Governor with a focus on Health. Mr. Bernabe most recently served as a Partner with Constantine Cannon, P.C., where for over 10 years he specialized in healthcare, antitrust and complex commercial litigation, as well as on providing corporate compliance advice to companies in the healthcare and insurance industries. He previously served as an associate at Coudert Brothers, LLP, and articled with the Canadian Department of Justice. Mr. Bernabe has both a Bachelor of Laws (J.D. equivalent) and a Bachelor of Civil Laws from McGill University Faculty of Law, and a B.A. from the University of Ottawa.

Mehul J. Patel has been appointed Chief Operating Officer and Chief of Staff at Empire StateDevelopment. Mr. Patel currently serves as Chief of Staff at ESD and will be adding the COO role to his responsibilities. He previously served as Vice President of the Moynihan Station Development Corporation, working with public and private stakeholders to expand New York’s Penn Station into the historic James A. Farley Post Office Building. Prior to this role, he was a Senior Project Manager for The Hudson Companies and was a Senior Analyst at HR&A Advisors. Mr. Patel was recently named to the Global 40 Under 40 by Urban Land. He has a B.A. from Yale University and an M.S. from Columbia University.

Heriberto (Ed) Vargas has been appointed Director of Labor Relations for the Department of Labor. He is a veteran New York City labor leader with more than 30 years of experience working on economic, political and social justice issues affecting working families in New York State, nationally, and internationally. He previously served as a consultant to Amalgamated Life Insurance Company and as Assistant to the President of Workers United, SEIU. He also served as Director of Mobilization at UNITE HERE and in various posts at the former International Ladies Garment Workers Union (ILGWU). Mr. Vargas served in the US Air Force during the Vietnam War, from which he was honorably discharged as a Staff Sergeant. He attended Herbert H. Lehman College, City University of New York.

Shareema Abel has been appointed Special Counsel to the Commissioner for Ethics, Risk and Compliance for Homes and Community Renewal. She currently serves as Litigation Attorney in the Teacher Performance Unit of the New York City Department of Education, where she was lead counsel on disciplinary hearings of tenured pedagogues. She previously served as an Assistant District Attorney in Gangs/Major Case/Homicide Bureau of the Bronx County District Attorney’s Office. Ms. Abel has a J.D. from Hofstra University School of Law and a B.A. from Binghamton University.

Linda Donahue has been appointed Special Counsel to the Commissioner for Ethics, Risk and Compliance for the Division of Homeland Security and Emergency Services. Ms. Donahue currently serves as Senior Counsel for the New York City Law Department, where she litigated and managed federal civil rights class actions and wrongful conviction cases. She was previously a partner at Kostelantetz & Fink, LLP, and Counsel at Frankel & Abrams. Ms. Donahue has a J.D. from New York University School of Law and a B.A. in Social Work from Florida State University.

Nika Milbrun has been appointed Assistant Director of Constituencies for African American and Women’s Affairs for the Executive Chamber. Ms. Milbrun most recently served as Regional Field Director for Terra Strategies on behalf of the Democratic Congressional Campaign Committee. She previously was the Field Director for Dell Smitherman’s 2014 State Senate campaign and, prior, was a Special Assistant for the UN Child Rights & Business Workshop. She was also a Community Outreach Coordinator for the New York State Senate Democratic Conference. She served as Regional Field Organizer for One Nation Working Together as well as David Yassky's campaign for New York City Comptroller. Ms. Milbrun attended Baruch College.

Matthew L. Ossenfort has been appointed to serve on the State Workforce Investment Board. Mr. Ossenfort was elected Montgomery County Executive in November 2013. At 33, he is the youngest sitting county executive in New York State. He was born and raised in Amsterdam, attended Amsterdam City Schools and is a lifelong resident of Montgomery County. Upon graduation, he began work in the New York State Assembly, where he worked for various members in different capacities. In 2007, he became Chief of Staff to Assemblyman George Amedore. He is also the founding member and president of Habitat for Humanity Montgomery County NY. Prior to being elected as Montgomery County’s first Executive, he worked as a Senior Legislative Analyst with the New York State Senate. Mr. Ossenfort holds a Bachelor's Degree in Political Science and History from the University at Albany.

Internal Revenue Service’s requirements that apply to public employers

Internal Revenue Service’s requirements that apply to public employers

Source: The United States Internal Revenue Service

The Internal Revenue Service is offering a free “Compliance Self-Assessment Tool for Government Entities” on May 14, 2015; 2 p.m. (EST)

To Register click on: http://www.visualwebcaster.com/IRS/102153/reg.asp?id=102153

N.B. You will use this same link to attend the event.

The Self-Assessment Tool will assist public entities to:

Identify legal requirements that apply to public employers;

Recognize unique federal income, social security and Medicare taxes and public retirement system obligations;

Gain awareness of potential compliance issues; and

Understand the most common tax issues 
 

Probationary employee terminated after testing positive for cocaine

Probationary employee terminated after testing positive for cocaine

2015 NY Slip Op 03359, Appellate Division, Second Department

The New York City Transit Authority [Authority] terminated the employment of a subway conductor [Conductor] who was then serving as a probationary employee.

Conductor had sustained injuries in an off-duty motor vehicle accident and was absent from work for a period of more than 21 days. As a condition of returning to work, Conductor was required to undergo a medical evaluation, including the administration of a drug test. Conductor tested positive for cocaine and the Authority terminated his employment.

Conductor filed an Article 78 petition seeking a court order directing his reinstatement to his former position. Supreme Court denied Conductor’s petition and Conductor appealed the court’s dismissal of the proceeding.

The Appellate Division sustained the Supreme Court’s ruling. Citing York v McGuire, 63 NY2d 760,  the court explained that a probationary employee may be discharged without a hearing* and without a statement of reasons in the absence of any demonstration that the termination was in bad faith, for a constitutionally impermissible purpose, or in violation of statutory or decisional law. Finding that Conductor failed to carry his burden of presenting competent proof of bad faith, illegal reasons, or a violation of statutory or decisional law, the court dismissed his appeal.

As to the Authority’s decision to terminate Conductor, the Appellate Division said that “the penalty of termination was not so disproportionate to the offense as to be shocking to one's sense of fairness.”

* N.B. Where a probationary period has been set in terms of a minimum and a maximum period of probation, case law holds that if the appointing authority elected to terminate a probationary employee during his or her minimum period of probation, such an individual is entitled to a notice and hearing in the same manner as a tenured individual.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2015/2015_03359.htm

Unscrupulous conduct or gross dereliction of duty warrants the removal of an officer of a town, village and other political subdivisions of the State pursuant to Public Officers Law §36

Unscrupulous conduct or gross dereliction of duty warrants the removal of an officer of a town, village and other political subdivisions of the State pursuant to Public Officers Law §36

2015 NY Slip Op 02815, Appellate Division, Third Department

Public Officers Law §36 provides that certain officers of a political division of the State may be removed from his or her office for misconduct, maladministration, malfeasance or malversation in office.  Loosely defined, these terms are used to describe, respectively, [1] acting unlawfully; [2] administer or manage badly or inefficiently; [3] commission of an act that is unequivocally illegal; and [4] corrupt behavior while serving in a position of trust.

In this action to remove a public officer from his positions with a Village the Appellate Division explained that “To warrant removal, an official's misconduct must amount to more than minor violations and must consist of "self-dealing, corrupt activities, conflict of interest, moral turpitude, intentional wrongdoing or violation of a public trust” constituting "unscrupulous conduct or gross dereliction of duty or conduct that . . . connotes a pattern of misconduct and abuse of authority."

Residents of the Village commenced this proceeding in the Appellate Division*seeking to remove the incumbent [Officer] from the public offices of Mayor and Village Manager pursuant to Public Officers Law §36. When Officer moved to dismiss the petition the court denied the motion. The Appellate Division then referred the matter to a Referee to conduct a hearing and report his findings and recommendations to the court.

In the course of the hearing the residents offered testimony from a Village Trustee, an Assistant District Attorney, two Village police officers and a Village employee, as well as submitting affidavits and other evidence to support their allegations.  In contrast, Officer, who was present and was represented by counsel during the hearing, offered no testimony or evidence on his own behalf.

Ultimately the Referee issued a report recommending the removal of Officer from his positions. When the residents moved to confirm the Referee's report, Officer cross-moved to disconfirm the report and dismiss the petition.

The Appellate Division confirmed the Referee's report, concluding that Officer’s conduct warranted his removal from the offices of Mayor and Village Administrator pursuant to Public Officers Law §36. The court commented that Officer’s actions "rise to the level of 'unscrupulous conduct or gross dereliction of duty or conduct that connotes a pattern of misconduct and abuse of authority.’"

* §36 provides, in pertinent part, that an application for such removal “may be made by any citizen resident of such town, village, improvement district or fire district … and shall be made to the appellate division of the supreme court held within the judicial department embracing such town, village, improvement district or fire district.”

The decision, which sets out the acts or omissions alleged to warrant Officer’s removal from office are set out in the decision of the Appellate Division which is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2015/2015_02815.htm

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