New York State Comptroller Thomas P. DiNapoli announced the following audits and examinations have been issued

New York State Comptroller Thomas P. DiNapoli announced the following audits and examinations have been issued

Source: Office of the State Comptroller, June 19, 2018

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State Education Department (SED): Infant and Child Learning Center (ICLC) - The Research Foundation for the State University of New York: Compliance with the Reimbursable Cost Manual (2017-S-22)

For the three fiscal years ended June 30, 2015, auditors identified $1,727,960 in reported costs that did not comply with SED requirements for reimbursement, including $1,519,114 in improperly calculated parent agency administrative allocation costs.

New York State Health Insurance Program (NYSHIP): Preventing Inappropriate and Excessive Costs in the New York State Health Insurance Program (2016-D-1)

Based on the findings of 35 reports, auditors determined significant cost savings to NYSHIP would occur if more out-of-network providers who improperly waive members’ out-of-pocket costs ended this practice and joined the Empire Plan network. Additionally, out-of-network providers who join the Empire Plan benefit plan members by expanding the number of in-network providers from which members can choose. Auditors recommended that action be taken to recover overpayments and prevent out-of-network providers from improperly waiving members’ out-of-pocket costs.

Department of Health (DOH): Examination of Official Station Designation (2015-BSE1-04)
DOH’s designation of the official station for an employee in calendar years 2013 and 2014 was not made in accordance with the state’s travel rules and regulations. As a result of an improper official station designation, DOH paid $16,089.56 and $22,033.71 in travel expenses during calendar years 2013 and 2014 for the employee to commute between his residence and an alternate work location.

New York City Department of Social Services (DSS): Oversight of Security Expenses in Single Adult and Adult Family Homeless Shelters (2016-N-6)

The city’s Department of Homeless Services, working under DSS, did not have adequate written standard operating procedures to guide staff on how to perform and document the required oversight reviews and inventory record-keeping practices at shelter locations. DHS did not consistently comply with its own policies to perform periodic reviews of shelter providers’ security expenditures. Auditors found significant compliance-related issues that accounted for $2.2 million in insufficiently documented and/or questionable security expenses. DHS also did not ensure that providers complied with competitive bidding requirements and maintained adequate supporting documentation.

Find out how your government money is spent at Open Book New York. Track municipal spending, the state's 145,000 contracts, billions in state payments and public authority data. 

 

Determining if a police officer acted within the scope of his or her employment for the purposed of the employer providing for defense and indemnification

Determining if a police officer acted within the scope of his or her employment for the purposed of the employer providing for defense and indemnification

Lemma v Nassau County Police Officer Indem. Bd., 2018 NY Slip Op 04382, Court of Appeals

General Municipal Law § 50-1 provides for defense and indemnification of Nassau County police officers, requiring indemnification for civil "damages, including punitive or exemplary damages, arising out of a negligent act or other tort of such police officer committed while in the proper discharge of [the officer's] duties and within the scope of [the officer's] employment."

In this CPLR Article 78 proceeding, the issue is whether the Nassau County Police Officer Indemnification Board's determination revoking a prior defense and indemnification determination in favor of a Nassau County police officer, [Petitioner] was irrational. To answer that question, the Appellate Division said that it must determine the meaning of the phrase "proper discharge of . . . duties" in the context of this statute. Its conclusion: the Board's finding that Petitioner's conduct was not "proper" within the meaning of the statute was rational.

The genesis of this action was an arrest of one Raheem Crews [Crews] for a crime. A few days later, on June 1, 2005, Petitioner questioned another suspect, who admitted his own involvement but said that Crews was in jail at the time of the robbery. That same day, Petitioner confirmed via a police database search that Crews was incarcerated on the date of the robbery. Despite knowledge that Crews could not have been one of the perpetrators, Petitioner told no one.

It was not until September, after Crews was arraigned on an indictment listing the date of the robbery as March 26, 2005, that defense counsel demonstrated that Crews had been incarcerated on that date, securing his immediate release and dismissal of the charges.

Crews commenced an action in federal court pursuant to 42 USC §1983 against Petitioner, among others and Nassau County, unaware at that time that Petitioner had known and failed to disclose that Crews was in jail on the date of the crime, offered to represent and indemnify Petitioner pursuant to General Municipal Law §50-1, based on the Board's initial determination that any actions taken by Petitioner that might give rise to liability were within the scope of Petitioner's employment and a proper discharge of his duties. When some years later, as the result of Petitioner being deposed in the Crews case, it was revealed for the first time that Petitioner had learned a few days after the arrest that Crews was in jail on the date of the robbery, the Board reopened its decision to indemnify Petitioner and held a hearing. Ultimately the Board voted to revoke defense and indemnification.

In affirming the Board's decision, the Appellate Division held, among other things, that "the Board rationally interpreted General Municipal Law §50-1 to limit defense and indemnification, reasoning that the word "proper" was "added . . . to exclude indemnification for intentional misconduct."

Petitioner next sought permission to appeal the Appellate Division's ruling and the Court of Appeals granted Petitioner's motion.

The Court of Appeals affirmed the Appellate Division decision, noting that "Where, as here, no administrative hearing was required, judicial review of an agency determination is limited to whether the Board's determination was irrational or arbitrary and capricious." Citing Williams v City of New York, 64 NY2d 800, the court explaining that an administrative determination of a board or agency involving employee indemnification "may be set aside only if it lacks a factual [or legal] basis, and in that sense, is arbitrary and capricious."

Noting that General Municipal Law §50-1 authorizes Nassau County to defend and indemnify police officers named as defendants in civil actions or proceedings, providing indemnification from "any judgment . . . for damages, including punitive or exemplary damages, arising out of a negligent act or other tort of such police officer committed while in the proper discharge of [the officer's] duties and within the scope of [the officer's] employment" the statute provides that "[s]uch proper discharge and scope shall be determined by a majority vote of a panel" appointed by various Nassau County officials, the Court of Appeals concluded that "[t]he legislature, thus, left the determination of whether the statutory prerequisites are met to the discretion of the Board."

Significantly, the Court of Appeals said that "[t]he decision whether to defend and indemnify a police officer is typically made by the Board at the beginning of litigation or upon discovery of facts previously unknown — long before the facts are litigated and a judgment of punitive damages is ever rendered. The Board may take a different view of the facts than is ultimately adopted by a jury in the underlying civil action against the officer."

Concluding that the Board's determination that Petitioner's conduct was not in the "proper discharge of his duties" was not arbitrary and capricious and that there was evidence supporting the Board's finding the decision notes that "despite knowledge that Crews could not have committed the robbery for which he had been arrested and charged (and for which he remained in pretrial detention for four months), [Petitioner], by his own admission, remained silent — conduct antithetical to proper police work that resulted in a man's loss of liberty."

Holding that the Board's determination was rational, the Court of Appeal held that it was entitled to deference and must be sustained."

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2018/2018_04382.htm

Proper service of the petition and notice of the petition of an appeal to the Commissioner of Education critical to the Commissioner assuming jurisdiction

Proper service of the petition and notice of the petition of an appeal to the Commissioner of Education critical to the Commissioner assuming jurisdiction

Appeal of J.M from action of the Board of Education of the Croton-Harmon Union Free School District, Decisions of the Commissioner of Education, Decision No. 17,402

In some instances an appeal to the Commissioner of Education is dismissed for failure to comply with certain procedural requirements. The appeal of J.M. illustrates one of the reasons why an appeal is rejected on technical grounds, in this instance for lack of proper service of the appeal on the respondent parties.

Croton-Harmon Union Free School District, in its reply to J.M.'s appeal, contended that the appeal must be dismissed for lack of proper service. The Commissioner agreed, explaining that the Commissioner’s regulation requires that the petition be personally served upon each named respondent as set out in 8 NYCRR §275.8(a).*

In the event a school district is named as a respondent, 8 NYCRR §275.8(a) requires that service upon the school district "shall be made personally by delivering a copy of the petition to the district clerk, to any trustee or any member of the board of education, to the superintendent of schools, or to a person in the office of the superintendent who has been designated by the board of education to accept service."

J.M.'s affidavit of service indicated that the appeal was served upon the secretary to the superintendent.  Although the affidavit of service attests that the secretary was “duly authorized to accept service,” Croton-Harmon said that the secretary has not been designated by it to accept service on behalf of the school district or the superintendent. 

The Commissioner, noting that J.M. did not submitted a reply or otherwise responded to the Croton-Harmon’s "motion to dismiss" J.M.'s appeal, said that in the event there is no proof that an individual is authorized to accept service on behalf of respondent, "service is improper and the appeal must be dismissed."

The Commissioner observed that considering the record before her, "I cannot conclude that [J.M.] properly served a copy of the notice of petition and petition on [Croton-Harmon]" and, accordingly, J.M.'s appeal must be dismissed.

Another common procedural defect resulting in the dismissal of the appeal is the petitioner's failure to serve a "necessary party" as required by 8 NYCRR 277.1(b).**

A "necessary party" is a  party whose rights would be adversely affected by a determination of an appeal in favor of a petitioner and must be joined as such. Further, joinder as a necessary party requires that an individual be clearly named as a necessary party by name in the caption of the petition and served with a copy of the notice of petition and petition to inform the individual that he or she should respond to the petition and enter a defense.

Further, it is the petitioner's burden to properly serve the petition and the service of the petition and the petitioner must submit evidence that that has been done. In the absence of such evidence, the Commissioner has ruled that the appeal must be dismissed "for improper service."

* 8 NYCRR 275.8, service of pleadings and supporting papers, provides as follows:

(a) Petition. A copy of the petition, together with all of petitioner's affidavits, exhibits, and other supporting papers, except a memorandum of law (unless the appeal is a charter school location/co-location appeal pursuant to section 276.11 of this Title, in which case the memorandum of law shall be served with the petition) or an affidavit in support of a reply, shall be personally served upon each named respondent, or, if a named respondent cannot be found upon diligent search, by delivering and leaving the same at the respondent's residence with some person of suitable age and discretion, between six o'clock in the morning and nine o'clock in the evening, or as otherwise directed by the commissioner. If a school district is named as a party respondent, service upon such school district shall be made personally by delivering a copy of the petition to the district clerk, to any trustee or any member of the board of education of such school district, to the superintendent of schools, or to a person in the office of the superintendent who has been designated by the board of education to accept service. If a board of cooperative educational services is named as a party respondent, service upon such board shall be made personally by delivering a copy of the petition to the district superintendent, to a person in the office of the district superintendent who has been designated by the board to accept service, or to any member of the board of cooperative educational services. Pleadings may be served by any person not a party to the appeal over the age of 18 years. If the last day for service of the petition falls on a Saturday or Sunday, service may be made on the following Monday; and if the last day for such service falls on a legal holiday, service may be made on the following business day.

** In Decisions of the Commissioner of Education, Decision #16,853 the Commissioner noted that although a necessary party had not been named in "the original petition," her Office of Counsel had advised the all the parties that the petitioner's earlier request to join an individual as a necessary party was granted. Consequently, said the Commissioner, “in this instance, I find the failure to include that [individual] in the original petition is not a basis for dismissal of this appeal."

The decision is posted on the Internet at:

http://www.counsel.nysed.gov/Decisions/volume57/d17402

Arbitration award found "imperfectly executed" vacated

Arbitration award found "imperfectly executed" vacated

Matter of The Professional, Clerical, Tech. Empls. Assn. (Board of Educ. for Buffalo City Sch. Dist.), 2018 NY Slip Op 04128, Appellate Division, Fourth Department

Supreme Court granted the petition submitted by The Professional, Clerical, Technical Employees Association [Association] seeking to confirm an arbitration award and denied the Board of Education for Buffalo City School District's [Board] cross petition seeking a court order vacating the arbitration award. The Appellate Division unanimously reversed the Supreme Court's ruling, on the law, and vacated the arbitration award, explaining:

1. The arbitration proceeding arose from Board's plan to transfer certain employees previously assigned to work at a single location to new positions requiring them to alternate between two different work locations.

2. The arbitrator's opinion and award, among other things, found that Board had  involuntarily transferred* the Association's grievants "to new positions" in violation of the collective bargaining agreement between the parties, and directed the Board to compensate the grievants "for work performed at more than one location from November 30, 2013 until the end of the 2016 Budget Year."

3. Vacatur of the arbitration award is appropriate where the award failed to set forth the manner of computing monetary damages as CPLR Article 75 provides, in pertinent part, that an arbitration award "shall be vacated" where the arbitrator "so imperfectly executed [the award] that a final and definite award upon the subject matter submitted was not made."**

The court noted that the Board's affidavit in support of the cross petition contained a statement that "none of the affected employees was terminated or had his or her compensation reduced as a result of the allegedly wrongful transfers."

However, said the Appellate Division, the arbitration award does not explain the basis for the arbitrator's directing the Board provide compensation allegedly owed to the grievants, nor does the award detail how that compensation should be calculated. Rather, said the court, "[i]t appears that the arbitrator merely copied verbatim the remedy requested by [the Association] rather than making findings of his own."

Accordingly, the Appellate Division reverse the Supreme Court's order, denied the Associations petition, granted the Association's cross petition, vacated the arbitration award, and remitted the matter to Supreme Court.

In addition, Supreme Court was instructed to then remit the matter to the arbitrator to determine whether any compensation is due the Association's grievants, and, if so, "to determine the amount of such compensation or how it can be calculated with reasonable precision."

* Although the term "transfer" is used to describe the personnel change that resulted in the submission of this grievance, the term "reassignment" would be a more accurate of the personnel change in this instance. A movement of an individual from one position to a second position subject to the jurisdiction of the same appointing authority is typically described as a "reassignment." In contrast, the movement of an employee from one position to a second position under the jurisdiction of a different appointing authority would constitute a "transfer" [see Rules for the Classified Civil Service of the County of Erie, Rule XVI].

** An award is indefinite or nonfinal within the meaning of the statute only if it leaves the parties unable to determine their rights and obligations; if it does not resolve the controversy submitted; or if it creates a new controversy.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2018/2018_04128.htm

A party filing a motion seeking a permanent stay of a demand for arbitration must satisfy a "two-part test" to prevail

A party filing a motion seeking a permanent stay of a demand for arbitration must satisfy a "two-part test" to prevail

Village of Garden City v Professional Firefighters Assn. of Nassau County, Local 1588, 2018 NY Slip Op 03688, Appellate Division, Second Department

This proceeding involved a dispute between Village of Garden City [Village],  and the Professional Firefighters Association of Nassau County, Local 1588 [PFA] concerning  Village's implementation of a staffing protocol that was formulated to ensure compliance with a prior arbitration award that was earlier confirmed by this court.* The arbitrator in the earlier arbitration had found that the Village violated the parties' collective bargaining agreement [CBA] by assigning the operation of first-line equipment to volunteer firefighters rather than to paid firefighters represented by PFA.  

PFA filed a grievance contending that the new protocol continued to improperly assign the operation of first-line equipment to volunteer firefighters and demanded arbitration. The Village objected to submitting this new grievance to arbitration and filed an Article 75 petition seeking a permanent stay of the arbitration. Supreme Court issued denied the Village's petition and granting PFA's motion to compel arbitration of the grievance. The Village appealed the Supreme Court's ruling.

The Appellate Division ruled that Supreme Court properly denied the Village's petition to permanently stay arbitration of the grievance and granted PFA's motion to compel the arbitration of the grievance noting that in the earlier proceeding it had ruled that  grievances challenging the operation of first-line equipment by volunteers were arbitrable.

Referring to the two-part test used by the courts to determine whether a dispute between a public sector employer and employee is arbitrable** the court explained that:

1. "Initially, the court must determine whether there is any statutory, constitutional, or public policy prohibition against arbitrating the grievance;

2. "If there is no prohibition against arbitrating, the court must examine the parties' collective bargaining agreement and determine if they in fact agreed to arbitrate the particular dispute;

3. "In examining the collective bargaining agreement, the court must merely determine whether there is a reasonable relationship between the subject matter of the dispute and the general subject matter of the [agreement];

4. "If there is, the court should rule the matter arbitrable, and the arbitrator will then make a more exacting interpretation of the precise scope of the substantive provisions of the CBA, and whether the subject matter of the dispute fits within them."

As the Village was unable to demonstrate that arbitration of PFA's instant grievance was prohibited by statutory or public policy or that PFA's instant grievance was not reasonably related to the general subject matter of the CBA, the court again ruled that the question of the scope of the substantive provisions of the CBA was a matter of contract interpretation and application reserved for the arbitrator.

* See Matter of Professional Firefighters Assn. of Nassau County, Local 1588, Intl. Assn. of Firefighters, AFL-CIO v Village of Garden City, 119 AD3d 803.

** See Locust Val. Cent. Sch. Dist. v Benstock, 144 AD3d 758.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2018/2018_03688.htm