Selected Reports issued by the Office of the State Comptroller during the week ending November 13, 2015

Selected Reports issued by the Office of the State Comptroller during the week ending November 13, 2015

Click on text highlighted in color to access the full report

School DistrictAudits

Chatham CSD – Financial Condition
The district realized operating surpluses because the board overestimated expenditures when developing budgets. The district has not established a formal plan stating how much will be set aside in each reserve, how each reserve will be funded or when reserve funds are to be used.

http://www.osc.state.ny.us/localgov/audits/schools/2015/chatham.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015arelease

Cherry Valley-Springfield CSD – School Lunch Operations
The district is serving nutritious meals to its students. However, the meals cost more to prepare than the revenue generated by the meal sales.

http://www.osc.state.ny.us/localgov/audits/schools/2015/cherryvalleyspringfield.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015arelease

Edmeston CSD – School Lunch Operations
The district serves nutritious meals to its students and cafeteria staff produce the meals in a productive manner. However, meals cost more to prepare than the revenue generated by the meal sales.

http://www.osc.state.ny.us/localgov/audits/schools/2015/edmeston.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015arelease

Kenmore-Town of Tanawanda UFSD - Financial Management

The district consistently appropriated fund balance that was not needed to finance operations. In addition, the district overfunded three reserves by approximately $5.6 million, incorrectly recognized $1.2 million in liabilities and accumulated $905,606 in the debt reserve as of June 30, 2014.

http://www.osc.state.ny.us/localgov/audits/schools/2015/kenmoretonawanda.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015arelease

Penfied CSD – Financial Management

The district adopted budgets with overestimated expenditures and appropriated fund balance to finance operations that was not actually used. As of June 30, 2015, two reserves with balances totaling approximately $8 million are overfunded and potentially unnecessary. The school lunch fund’s total fund balance exceeds the federally regulated limit by more than $45,000.

http://www.osc.state.ny.us/localgov/audits/schools/2015/penfield.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015arelease

Municipal Audits

Town of Deerpark – Budget Review
The significant revenue and expenditure projections in the preliminary budget are reasonable. However, the continued reliance on appropriated fund balance to fund town operations will eventually deplete fund balance and adversely affect the town’s financial condition. The town’s 2016 proposed budget complies with the property tax cap levy limit.

http://www.osc.state.ny.us/localgov/audits/towns/2015/deerpark_br.pdf

Town of East Hampton – Budget Review

The significant revenue and expenditure projections in the tentative budget are reasonable. The town’s 2016 tentative budget complies with the property tax cap levy limit.

http://www.osc.state.ny.us/localgov/audits/towns/2015/easthampton_br.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

Village of East Hampton – Information Technology

The board has not adopted written computer-related policies to address user access, remote access, password security and management, or data backups. Additionally, village officials improperly assigned administrative privileges, created generic user accounts and provided excessive access rights to the village’s financial and real property tax software.

http://www.osc.state.ny.us/localgov/audits/villages/2015/easthampton.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

Halfmoon Hillcrest Volunteer Fire Company – Financial Operations

The former treasurer did not maintain appropriate, accurate, complete or timely financial records and reports. The board did not perform an audit of the treasurer’s records for the 2011, 2012 and 2013 fiscal years until April 2014.

http://www.osc.state.ny.us/localgov/audits/firedists/2015/halfmoonhillcrest.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

Jamison Road Volunteer Fire Company, Inc. –Internal Controls Over Financial Operations

The board generally did not provide adequate oversight of company financial activities to ensure that resources are safeguarded. The treasurer did not obtain board and membership approval for all bills before paying them and did not retain adequate supporting documentation to demonstrate that all purchases were for a valid company purpose.

http://www.osc.state.ny.us/localgov/audits/firedists/2015/jamisonroad.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

City of Lockport – Budget Review

The city has three different contracts with employee unions which have expired and has not included the potential financial impact of contract settlements in the proposed budget. The water rent revenue estimate could be overstated by approximately $400,000. The common council has indicated it will adopt a local law to override the tax levy limit in 2016.

http://www.osc.state.ny.us/localgov/audits/cities/2015/lockport_br.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

Rockland County – Budget Review

The significant revenue and expenditure projections in the proposed budget are reasonable. However, the county will need to closely monitor revenue associated with the sale of real property and chargebacks to other local governments. If this revenue is not realized, officials will either have to find another revenue sources or reduce appropriations accordingly. The county’s proposed budget exceeds the tax levy limit. The Legislature must pass a local law overriding the tax levy limit before adopting the proposed budget.

http://www.osc.state.ny.us/localgov/audits/counties/2015/rockland_br.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

City of Troy – Budget Review

The proposed budget, while generally reasonable, needs improvement to make it a better tool for prudently managing the city’s resources. For example, the city’s proposed budget includes estimated revenues related to the sale of real property, franchise fees, sales tax and advanced life support charges which may not be realized. The city’s proposed real property tax levy is not in compliance with its tax levy limit and officials have not adopted a local law to override the limit.

http://www.osc.state.ny.us/localgov/audits/cities/2015/troy_br.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

Village of Victor – Financial Management
The board needs to improve its oversight and management of the village’s budgeting and financial operations. The board has not adopted policies and procedures governing the budget process or a fund balance policy establishing the level of fund balance to maintain.

http://www.osc.state.ny.us/localgov/audits/villages/2015/victor.pdf?utm_source=weeklynews20151115&utm_medium=email&utm_campaign=111015brelease

Unions representing public employees are not state actors absent evidence of meaningful State participation in the activity underlying the complaint

Unions representing public employees are not state actors absent evidence of meaningful State participation in the activity underlying the complaint

Callaghan v United Fedn. of Teachers, 2015 NY Slip Op 08049, Appellate Division, First Department

Supreme Court granted the United Federation of Teachers’ [UFT] motion to dismiss James V. Callaghan’s lawsuit alleging [1] violation of his “state constitutional right to free speech and [2] defamation. Callaghan appealed but the Appellate Division sustained the lower court’s action.

Addressing Callaghan’s complaint alleging a violation of his free speech rights, the Appellate Division, citing Ciambriello v County of Nassau, 292 F3d 307, explained that his claim fails as a matter of law as the UFT is a private entity and New York courts have consistently held that unions, even those representing public employees, such as the UFT, are not state actors.

Further, said the court, Callaghan’s conclusory allegation that the UFT acted in concert with a “state actor” is not sufficient to state a claim against the UFT. The court cited SHAD Alliance v Smith Haven Mall, 66 NY2d 496, in which the Court of Appeal held that in order for a plaintiff to maintain such an action the plaintiff would have to allege facts that would show that the State [1] "is so entwined with the regulation of the private conduct as to constitute State activity"; [2] that "there is meaningful State participation in the activity"; or [3] that "there has been a delegation of what has traditionally been a State function to a private person."

As to Callaghan’s compliant alleging “defamation, “the Appellate Division ruled that the Supreme Court properly dismissed Callaghan’s cause of action for defamation explaining that “even to the extent that some of the statements about [Callaghan’s] disciplinary and professional history are assertions of fact, the statements were made by UFT officials in their official capacities, and they cannot be held liable for acts committed in their capacity as union representatives.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2015/2015_08049.htm

Jason Helgerson, New York State’s Medicaid Director, is one of nine outstanding public sector leaders named by Governing Magazine

Jason Helgerson, New York State’s Medicaid Director, is one of nine outstanding public sector leaders named by Governing Magazine

Mattie Quinn, writing for Governing, reports that "In the state that once spent the most on health care, Jason Helgerson found ways to cut New York's costs. Now he's leading one of the nation’s biggest Medicaid reforms."

Click on http://www.governing.com/poy/jason-helgerson.htmlto read Ms. Quinn’s article.

A public officer may be removed from his or her office pursuant to Public Officers Law §36

A public officer of a town, village, improvement district or fire district   officer by court may be removed from his or her office pursuant to Public Officers Law §36

Becallo v Zambrano, 2015 NY Slip Op 07091, Appellate Division, Fourth Department

Public Officers Law §36 was enacted to enable a town, a village, an improvement district or a fire district to remove a public officer found to be an unfaithful or dishonest public official. Paul Becallo filed a petition with the Appellate Division pursuant to §36 alleging that a town supervisor was either unfaithful or dishonest in the performance of her duties as the Town Supervisor in an effort to have the Appellate Division remove that individual from her public office.

The Town Supervisor admitted many of the factual allegations set out in Becallo’s petition, including his claim that [1] she had a romantic relationship with an employee of the engineering firm [employee] that was hired by the Town and [2] that she signed the contract with the engineering firm and approved invoices for work completed by the employee and [3] that she had used campaign funds to pay for a bulk mailing of a Town newsletter to senior citizens.

She denied, however, that her acts created a conflict of interest or constituted wrongdoing and submitted documentary evidence refuting another of Becallo’s allegation -- that she had altered the date on a shared services agreement with another Town.

The Supervisor romantic relationship with the employee began in the fall of 2011 while she was serving as a Town councilperson and at that time she had asked the Town Attorney whether there was a conflict of interest as a result of that relationship. The Town Attorney advised her in a written opinion that there was no conflict of interest and reiterated that opinion at a Town Board meeting in April 2014, when she was the serving as the Town Supervisor.

The Appellate Division also noted General Municipal Law §801 provides that "no municipal officer . . . shall have an interest in any contract with the municipality of which [she] is an officer . . . when such officer . . . has the power or duty to . . . approve the contract . . . or approve payment thereunder" but concluded that “[t]hose provisions do not apply here.”

Turning to Becallo’s allegations concerning “the financial arrangement between [the supervisor] and the employee regarding her purchase of a one-half interest in his residence,” the Appellate Division concluded that it cannot "reasonably be inferred that the [financial arrangement] was intended to influence [the supervisor], or could reasonably be expected to influence [her], in the performance of [her] official duties or was intended as a reward for any official action on [her] part." The Appellate Division held that Becallo failed to establish a conflict of interest with respect to the supervisor’s personal relationship with the employee.

As to Becallo’s allegation concerning the supervisor’s use campaign funds, the Appellate Division concluded that even assuming, arguendo, the use of those funds to pay for a bulk mailing of a Town newsletter to senior citizens was improper, such an impropriety does "not remotely rise to the level required for removal pursuant to Public Officers Law §36."

Finding that Becallo’s "petition does not set forth a single act of unscrupulous conduct or intentional wrongdoing, let alone evidence of any gross dereliction of duties or a pattern of misconduct," the Appellate Division dismissed his petition.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2015/2015_07091.htm

New York State Comproller DiNapoli spotlights New York’s Veterans

New York State Comproller DiNapoli spotlights New York’s Veterans

Source: Office of the State Comptroller

Nearly three-quarters of the approximately 890,000 veterans living in New York served during wartime, including 31 percent in the Vietnam War-era, according to State Comptroller Thomas P. DiNapoli.

The Comptroller said that “New York is home to nearly 900,000 men and women who have served bravely to safeguard our freedom. Across the country and in our state, we’ll be forever indebted to our veterans for their service and their sacrifices. We need to offer essential programs for the men and women who serve in our military to show our appreciation for their service and support their return to civilian life.”

DiNapoli’s report highlighted the programs and services offered to New York’s veterans by the state’s Division of Veterans’ Affairs and other agencies. The 2014-15 state budget allocated more than $21 million for veteran’s programs and services including counseling and benefit assistance services, tuition awards, peer-to-peer support services and nursing homes.

To access the Comptroller’s report please click on http://www.osc.state.ny.us/reports/other/veterans_11_2015.pdf

With both federal and state programs providing important services, DiNapoli urged policy makers at all levels to continuously examine whether existing initiatives appropriately meet the needs of New York's veterans.

DiNapoli also noted that the New York State Common Retirement Fund has a program to provide loans to veterans. The state pension fund partnered with the New York Business Development Corporation (NYBDC) Partnership to create a $5 million commitment for fixed-rate small business loans for returning military veterans who are also business owners. Veterans who serve in the Guard or Reserve, or have been honorably discharged from active duty may apply, through the NYBDC, for small business loans up to $150,000 to start or expand a business.

To learn about the New York State Common Retirement Fund’s loan program for veterans please click on http://www.nybdc.com/how-can-we-help/Loans_for_Veterans_69_7_sb.htm