Former police chief sentenced for "pension double-dipping"

In a press release issued on July 19, 2021, New York  State Comptroller Thomas P. DiNapoli announced that a former police chief was sentenced for "pension double-dipping." The former Village of Chatham Chief of Police Peter Volkmann is required to pay $92,829 in restitution and perform 200 hours of community service today for defrauding the New York State pension system by concealing his unlawful post-retirement public income and for stealing from the village through sham requests for reimbursement. 

The former police chief's fraud was discovered during a joint investigation by State Comptroller Thomas P. DiNapoli, Columbia County District Attorney Paul Czajka, and the New York State Police.

“No one is above law, including Volkmann who, as the chief law enforcement officer of the village, not only defrauded the state retirement system but also stole from his community,” said DiNapoli. “I thank District Attorney Paul Czajka and the New York State Police for their partnership in helping us bring justice to this case.”

"Mr. Volkmann stole funds from the citizens he was sworn to protect and serve as police chief of the Village of Chatham," District Attorney Paul Czajka said. "In doing so, he undermined much of the good he did in helping and providing assistance to so many suffering from addiction. With his conviction before Judge Koweek, those funds were returned in full to the Village of Chatham and the New York State Retirement System. I thank and commend the New York State Police, Comptroller Thomas DiNapoli and their highly trained and proficient investigators for bringing this complex case to a successful resolution. With the assistance of the Comptroller and the State Police, we continue to investigate the Village’s finances, as well as that of another institution."

“Our investigation determined that the suspect in this case violated the public trust by circumventing retirement laws and stealing from village funds,” said State Police Superintendent Kevin P. Bruen. “We will continue to aggressively investigate any case that involves public corruption, and I want to commend our members and the Comptroller’s Office and Columbia County District Attorney’s Office for their partnership to ensure that justice was served.”

Columbia Court Judge Richard Koweek also sentenced Volkmann to two years of conditional discharge and ordered that 100 hours of the 200 in community service he was sentenced to be done by July 2022. As part of his plea deal, Volkmann paid a total amount of $92,829 in restitution before his sentencing.

Volkmann pleaded guilty in February to grand larceny in the fourth degree for circumventing New York state’s post-retirement income restrictions and cheating the New York State and Local Retirement System out of $74,222. Volkmann hid public-source income from 19 municipalities and school districts in excess of the statutory limit by funneling the earnings through a private business, PF Volkmann & Associates. He also pled to official misconduct, a misdemeanor, for stealing $18,607 from the Village of Chatham by falsifying mileage vouchers and other reimbursements to increase his income. 

The practice of using a public office or position of trust for one's own gain or advantage is referred to as Jobbery [see https://educalingo.com/en/dic-en/jobbery].

Audits and reports issued during the week ending July 23, 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 July 23, 2021

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

 MUNICIPAL AUDITS

Copiague Fire District – Procurement (Suffolk County)

District officials did not always use a competitive process to procure goods, services or professional services or ensure no conflicts of interest existed. Auditors found no competition was sought for professional services. Officials paid the 12 providers $388,628. In addition, required verbal or written quotes were not always obtained when goods and services were procured. Auditors also found 23 purchases totaling $129,696 reviewed required competition. Only one purchase totaling $2,076 was competitively procured. A Commissioner, employed by a company the district contracts with, did not disclose his company’s interests or abstain or recuse himself from approving claims and warrants. The district has been contracting with the company for about 10 years.

 

City of Glen Cove Industrial Development Agency – Project Approval and Monitoring (Nassau County)

The board and officials did not properly approve and monitor projects or take action when goals were not met. Auditors found required annual financial disclosure statements that are meant to help identify conflicts of interest were not filed. Payments in lieu of taxes (PILOTs) billing and collections were not monitored or correctly allocated to affected taxing jurisdictions. In fact, 52 of 115 payments were late and late fees totaling $259,303 were not billed or collected. In addition, Nassau County received $375,914 more than it should have. These funds should have been paid to the City of Glen Cove, $75,039, and to the school district and library, $300,875. Tax exemptions disclosed in audited financial statements were overstated.

 

Village of South Floral Park – Budgeting and Financial Oversight (Nassau County)

The board did not provide appropriate oversight and management of budgets and fund balance or ensure annual audits were completed. More real property taxes were assessed than necessary to fund operations each year. The board also failed to hold budget hearings before April 15 each year (from two to 11 days late) to discuss the 2017-18, 2018-19 and 2019-20 budgets, and the budgets presented were not in the proper form, as required. Inaccurate budgeting led to underestimated revenues totaling $289,565 (19%) over these years. As of May 31, 2020, unassigned fund balance was $463,948, which is 78% of the 2020-21 appropriations. The Village has excess fund balance and the board did not adopt a fund balance policy.

 

Henrietta Fire District – Financial Condition (Monroe County)

The board did not effectively manage the district’s financial condition and presented budgets indicating the district needed to both increase real property taxes and use appropriated fund balance to close projected budget gaps. As a result, more real property taxes were levied than needed. The board also did not adopt realistic budgets from 2017 through 2021. As a result, fund balance increased to $4.4 million on December 31, 2020, which is excessive and enough to pay 41.5% of the District’s 2020 expenditures.

In addition, the board unnecessarily overrode the 2019 and 2020 tax cap. The 2021 tax cap override will likely be unnecessary because the 2021 budget overestimated appropriations by approximately $1.4 million, and the $1 million appropriated fund balance will likely not be used. The board did not adopt budgeting, fund balance or reserve policies or multiyear financial and capital plans.

 

Town of Otselic – Records and Reports and Conflict of Interest (Chenango County)

The Supervisor did not maintain complete, accurate and timely financial records and reports, and the board did not ensure there were no prohibited conflicts of interest. Auditors found the supervisor did not provide the board with accurate financial reports and did not record deposits totaling $127,000, cash withdrawals totaling $199,000 and fund transfers totaling $874 in the accounting records. She also recorded one deposit for $25,000 twice. Auditors also found, the required 2016 through 2019 annual financial reports were not filed with the Office of State Comptroller, as required. As of May 5, 2021, the reports were late and remained unfiled. In addition, a board member had a prohibited interest in the contracts between the town and his auto parts businesses. The board did not comply with General Municipal Law by adopting a code of ethics and did not audit the supervisor’s records, as required..

SCHOOL DISTRICT AUDITS

Mount Pleasant Central School District – Information Technology User Accounts (Westchester County)

District officials did not establish adequate controls over the district’s user accounts to prevent unauthorized use, access and/or loss. Officials did not monitor compliance with the district’s acceptable use policy. Officials also did not adequately manage network user accounts. Sensitive information technology control weaknesses were communicated confidentially to officials.

 

Williamson Central School District – Non-Payroll Disbursements (Wayne County)

The board did not ensure that non-payroll disbursements were appropriately procured, properly audited and approved, adequately supported and for valid district purposes. The claims auditor did not audit and approve claims before payment as required.

 

Attendance and Leave Memoranda

 The New York State Department of Civil Service has published the following Attendance and Leave Memoranda:

Advisory Memorandum 2021-05, Designation of Floating Holidays in Lieu of Election Day and Lincoln's Birthday for Contract Year 2021–2022; and 

Transmittal Memorandum No. 47, 2022 Calendar of Legal Holidays and Days of Religious Significance. 

The text of Advisory Memorandum 2021-05 is found at:
https://www.cs.ny.gov/attendance_leave/AdvMemo21-05.cfm. 

The text of Transmittal Memorandum No. 47 will be found at:
https://www.cs.ny.gov/attendance_leave/TM_47.cfm. 

If you wish to print Advisory Memorandum 2021-05 the Department offers  a version in PDF format at https://www.cs.ny.gov/attendance_leave/am21-05.pdf.

If you wish to print Transmittal Memorandum No. 47 the Department offers a version in pdf format at https://www.cs.ny.gov/attendance_leave/TM-47.pdf.

To view previous Attendance and Leave bulletins issued by the Department of Civil Service, visit: https://www.cs.ny.gov/attendance_leave/index.cfm.

 

The Intra-Military Immunity Doctrine bars judicial interference in discretionary military personnel decisions

A United States District Court granted the government’s motion to dismiss and, in the alternative, for summary judgment, on the Plaintiff-Appellant's [Cadet] claims that separation procedures of the United States Military Academy at West Point fail to provide due process and that the separation proceedings violated West Point’s own regulations in a manner that substantially prejudiced him. Cadet appealed the district court's ruling. 

The Circuit Court of Appeals held that West Point’s cadet separation procedures satisfy due process and that the intra-military immunity doctrine, which bars judicial interference in discretionary military personnel decisions, renders the Cadet’s regulatory claims nonjusticiable.

Accordingly, the Circuit Court affirmed the district court's judgment.

Click HEREto access the Circuit Court's ruling.

 

 

Diminishing retiree health insurance benefits

NYPPL has received a number of requests concerning a 2008 New York State Supreme Court decision that addressed the unilateral diminishing of retiree health insurance benefits by the retiree's former public employer.

The text of the decision, DiBattista v County of Westchester, is set out below:

 

DiBattista v County of Westchester

Decided on July 29, 2008
Supreme Court, Westchester County

Carmine DiBattista, ANTHYONY EGIZIACO, KATHERINE JONES, ANTHONY P. DEL BORGO, KENNETH A. FISCHER and VIOLA WANCHO on behalf of themselves and certain other RETIRED EMPLOYEES of the COUNTY OF WESTCHESTER formerly in the CSEA BARGAINING UNIT, Plaintiffs,

against

County of Westchester and ANDREW J. SPANO, as County Executive of the County of Westchester, Defendants.

Paul S. Bamberger, Esq.,
Nancy E. Hoffman, Esq.
Attorneys for Plaintiffs
CSEA, Inc.
Box 7125, Capitol Station
143 Washington Avenue
Albany, New York 12224

Matthew B. Kogan, Esq.
Ohrenstein & Brown, LLP
Attorneys for Defendants
1010 Franklin Avenue
Garden City, New York 11530

Joan B. Lefkowitz, J.

In this certified class action involving approximately 1,600 persons who retired from Westchester County during the period of 1993 to 2004, plaintiffs allege that defendants breached their contracts by diminishing their health insurance benefits causing plaintiffs additional medical and health insurance costs of $3,610,181 to date.

Between 1993 - 2001, two collective bargaining agreements were executed between CSEA and Westchester County which provided for certain medical health insurance benefits. Those provisions remained in effect until May 2004 when a new agreement was made. That agreement changed the health benefits of active employees and Westchester County decided that such changes also affected retired employees. It had been the policy of Westchester County to treat retirees the same as active employees whenever a new collective bargaining agreement occurred.

Counsel have stipulated to the facts in this action rather than a trial and have submitted various exhibits and memoranda of law for the Court to consider.

Until 1993, prior collective bargaining agreements insofar as health insurance benefits were concerned were effective for the duration of the contract or the term of the contract. The immediate past two collective bargaining agreements (effective January 1, 1993 through May 2004) omitted language as to duration and specifically included retirees.

Absent consent of all parties, a union does not represent retirees when it negotiates with an employer in collective bargaining. Allied Chem. Wkrs. v. Pittsburgh Plate Glass Co., 404 US 157, 180 footnote 20 (1971). Indeed, "vested retirement rights may not be altered without the pensioner's consent". Ibid. Where, as here, there is no durational limit in the immediate prior collective bargaining agreements as to retiree health insurance benefits "it is unlikely that such benefits, which are typically understood as a form of delayed compensation for past services, would be left to the contingencies of future negotiations". International Union, UAW v. Yard-Man, Inc., 716 F2d 1476, 1482 (6th Cir. 1983), cert. den. 465 US 1007 (1984). Retiree benefits "carry with them an inference that they continue so long as the prerequisite status is maintained". Ibid. This inference trumps any general duration clause as to the life or termination of the agreement. Id. at 1482-83. Therefore, pursuant to settled principles of law involving interpretation of collective bargaining agreements, it is clear that plaintiffs' health insurance benefits in the prior collective bargaining agreements survived those agreements and may not be diminished without their consent. Hudock v. Village of Endicott, 28 AD3rd 923 (3rd Dep't 2006); Della Rocco v. Schenectady, 252 AD2d 82 (3rd Dep't 1998); Myers v. City of Schenectady, 244 AD2d 845 (3rd Dep't 1997).

Defendants' reliance on McDonald Police v. Geneva, 92 NY2d 326 (1998) is misplaced as the collective bargaining agreements there did not address the benefits in issue whereas the prior collective bargaining agreements at bar do.

Accordingly, judgment in favor of plaintiffs is granted. Submit Order on notice. [*2]

DATED: July 29, 2008

ENTERED: /S/

JOAN B. LEFKOWITZ, J.S.C.