New York State and New York City audits posted on the Internet on August 22, 2024

On August 22, 2024, New York State Comptroller Thomas P. DiNapoli announced the following New York State and New York City audits were issued.

Click on the text in BLUE to access the text of the audit.

Department of Agriculture and Markets – Protection of Managed Pollinators (Honey Bees) (Follow-Up) (2023-F-43)
Honey bees are essential to the agricultural industry for the pollination services they provide. The State developed the New York State Pollinator Protection Plan in 2016 to address the high loss of pollinators in the State. A prior audit, issued in January 2023, found that the Department of Agriculture and Markets (Ag&Mkts) could strengthen its actions to combat disease and parasitic organisms within colonies by including additional tests for certain diseases and could improve its efforts to ensure honey bees entering the State are healthy and free from disease. Additionally, Ag&Mkts did not have support or reasonable assurance that it had identified the full population of active apiaries in the State, which is necessary for thorough monitoring and inspection purposes. Ag&Mkts made progress in addressing the issues identified in the initial audit report, implementing both recommendations.

Office of Temporary and Disability Assistance – Reimbursement of Homeless Shelter Providers – Rescue Mission Alliance of Syracuse (Follow-Up) (2024-F-2)
The Onondaga County Department of Social Services contracted with the not-for-profit Rescue Mission Alliance of Syracuse (Rescue Mission) to provide homeless services. The Office of Temporary and Disability Assistance (OTDA) is responsible for reviewing each shelter’s operating budget, working with the local departments of social services (Local Districts) to ensure that all required documents have been included, and assessing budgeted operating costs to verify that they are reasonable and necessary. A prior audit, issued in October 2022, found that, outside of OTDA’s oversight processes for the review and approval of shelter budgets, OTDA had not taken any action thereafter to ensure that shelters’ actual costs claimed for reimbursement complied with the approved budget, State laws and regulations, or OTDA’s own policies. OTDA made some progress addressing the issues from the original report, recovering an overpayment and establishing a system of monitoring controls over Local Districts. Of the initial report’s four recommendations, two were implemented, one was partially implemented, and one was not implemented.

Department of Corrections and Community Supervision – Oversight of Transportation Services and Expenses (Follow-Up) (2023-F-37)
Many of the Department of Corrections and Community Supervision’s (DOCCS) employees operate its vehicles in its day-to-day operations. Five of its 44 correctional facilities, as well as its Central Office and seven regional offices that provide support services for enrollees, exclusively use a centralized procurement contract (Contract) for fleet management and repair services. A prior audit, issued in June 2022, found DOCCS performed limited to no central monitoring of payments made through its Contractor and did not monitor in-house maintenance expenses, instead relying on each facility or office for accurate reporting. DOCCS officials made some progress in addressing the issues identified in the initial report, taking steps to implement procedures to monitor the Contractor’s performance and implementing a process to ensure maintenance costs are reasonable and comply with requirements. Of the initial report’s seven recommendations, two have been implemented, four have been partially implemented, and one has not been implemented.

New York City Department of Finance – Citywide Payment Services and Standards – Controls Over Payments (2022-N-2)
The New York City Department of Finance (DOF) Citywide Payments Services and Standards unit administers a centralized payment repository for accepting payments made to City agencies (System) intended to allow agencies to focus on their core business while helping them save time and money. Auditors found that DOF could improve controls and monitoring for its System to ensure payments are promptly reconciled. Further, they found that DOF does not attempt to determine whether the System promotes time and cost savings for agencies despite these savings being a stated goal of the System.

Office of Temporary and Disability Assistance – Reimbursement of Homeless Shelter Providers – Westhab Inc.’s Coachman Family Center (Follow-Up) (2024-F-1)
The Westchester County Department of Social Services contracted with the not-for-profit Westhab Inc. (Westhab) to operate Coachman Family Center as a certified shelter for families with children. The Office of Temporary and Disability Assistance (OTDA) is responsible for reviewing each shelter’s operating budget, working with the local departments of social services (Local Districts) to ensure that all required documents have been included, and assessing budgeted operating costs to verify that they are reasonable and necessary. A prior audit, issued in March 2022, found that OTDA was not adequately monitoring and properly approving reimbursements for Westhab’s homeless shelter program, nor had OTDA established an effective budget review process for shelter budgets. OTDA officials made some progress in addressing the issues identified during the initial audit, recovering overstated depreciation and establishing a system of monitoring controls to improve oversight of Local Districts’ reimbursement to providers. Of the initial report’s six audit recommendations, two were implemented, one was partially implemented, and three were not implemented.

New York State Health Insurance Program – Anthem Blue Cross – Coordination of Benefits With Medicare (2023-S-3)
The Empire Plan is the primary health benefits plan for the New York State Health Insurance Program, administered by the Department of Civil Service (Civil Service). Civil Service contracts with Anthem Blue Cross (Anthem) to administer the Hospital Program of the Empire Plan, and many enrollees and their dependents have other insurance coverage in addition to the Empire Plan such as Medicare. Coordination of benefits is a process health insurance companies use for paying health care claims when people are covered by more than one insurance plan. For the audit period, auditors found Anthem improperly paid 241 claims totaling $5,259,416 because proper coordination of benefits did not occur. Anthem’s eligibility system was not always updated promptly with members’ Medicare-related information, and weaknesses in Anthem’s and Civil Service’s reconciliation of member enrollment data prevented opportunities for recovery.

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Some critical procedural elements to consider when initiating an Article 78 action challenging an administrative adjudication

Petitioner commenced this proceeding pursuant to CPLR Article 78 to review the Office of Court Administration's [OCA] denial of his grievance conducted pursuant to the relevant collective bargaining agreement's "noncontractual grievance procedure". 

Pursuant to CPLR 3211(a), OCA moved to dismiss the petition, arguing that the proceeding was time-barred by the applicable statute of limitations. Supreme Court granted OCA's motion, denied the petition, and dismissed the proceeding. Petitioner appealed the Supreme Court's decision.

The Appellate Division held that "Supreme Court properly granted OCA's motion pursuant to CPLR 3211(a) to dismiss the petition, denied the petition, and dismissed the proceeding", noting, among other things,:

"A proceeding against a body or officer must be commenced within four months after the determination to be reviewed becomes final and binding on the petitioner; 

"An administrative determination becomes 'final and binding' when two requirements are met: completeness (finality) of the determination and exhaustion of administrative remedies;

"OCA's determination denying the [Petitioner's] request 'became final and binding no later than five days after a letter dated January 10, 2022, was mailed (see CPLR 2103[b][2]). The petition was filed in August 2022 and therefore, the proceeding was untimely';

"OCA's denial letter was not ambiguous because it denied the Petitioner's request 'at this time.' The denial letter, which also advised the [Petitioner] that any different determination would require a new request ... 'left no doubt that there would be no further administrative action' "; and

"A statute of limitations is not tolled 'by the invocation of grievance procedure which is merely an alternative remedy'. Here, the noncontractual grievance procedure provided for in the relevant collective bargaining agreement was not mandatory but merely an alternative remedy. Therefore, the [Petitioner's] invocation of that procedure did not toll the [running of the] statute of limitations".

Click HERE to access the entire text of the Appellate Division's opinion posted on the Internet.

Determining an applicant's eligibility for accidental disability retirement benefits

Petitioner in this CPLR Article 78 action, a police detective and paramedic, applied for accidental disability retirement benefits claiming that he was permanently incapacitated from performing his job duties as a result of injuries sustained in three incidents, one which occurred in July 2007, another which occurred in February 2012 and a last one which occurred June 2017. 

Petitioner's application was denied by the New York State Retirement System [System] based on its finding that the incidents did not constitute accidents within the meaning of Retirement and Social Security Law §363.*

Noting that an applicant accidental disability retirement benefits bares the burden of establishing that his disability arose from an accident within the meaning of the Retirement and Social Security Law, and that the System's determination in this regard will be upheld "if supported by substantial evidence", the Appellate Division, citing Matter of Kubala v New York State and Local Retirement Sys., 220 AD3d 993, and other decisions, explained that for the purposes of accidental disability retirement benefits, "an accident is defined as 'a sudden, fortuitous mischance, unexpected, out of the ordinary, and injurious in impact' " .

Further, opined the Appellate Division, "An injury which occurs without an unexpected event as the result of activity undertaken in the performance of ordinary employment duties, considered in view of the particular employment in question, is not an accidental injury".

With respect to the July 14, 2007 incident and the February 17, 2012 incident, the Appellate Division said it was not persuaded that the resulting injuries were compensable accidents. However, it reached reach a different conclusion regarding the incident on June 22, 2017, during which "the retractable portion of a stretcher jammed causing instantaneous pain and injury to [Petitioner's] shoulder and neck".

The Appellate Division opined that "Although extending the retractable head portion of the stretcher was no doubt part of [Petitioner's] job duties, the precipitating external event, i.e., the jamming of the retractable head section of the stretcher, was sudden, unexpected and not a risk in his ordinary employment duties" and appeared to have been caused by a malfunction in the equipment.

Accordingly, the Appellate Division**, ruled that denial of Petitioner's application with respect to the June 22, 2017, injury on the ground that the incident did not constitute an accident within the meaning of Retirement and Social Security Law §363 was not supported by substantial evidence.

* Following a hearing, the Hearing Officer upheld the denial of Petitioner's application, finding that the underlying incidents were either a risk inherent in the performance of his duties or foreseeable and, therefore, did not constitute accidents for purposes of accidental disability retirement.

** Lynch, J. (concurring in part and dissenting in part), agreed with the majority, but in his view the February 17, 2012 incident constituted "an accident, not unlike that [described] in Matter of Loia v DiNapoli, 164 AD3d 1513".

Click HERE to access the Appellate Division's decision posted on the Internet.

Compelling the disclosure of certain disciplinary records of sworn officers employed by a police department in New York State

In this CPLR Article 78 to compel the production of records pursuant to the Freedom of Information Law (Public Officers Law Article 6), Petitioner appealed Supreme Court's judgment that denied that branch of the petition seeking the production of certain  records it sought and dismissed that portion of the proceeding. The Appellate Division reversed the Supreme Court's ruling "insofar as appealed from, on the law," with costs, and granted that branch of the petition, which was to compel the production of certain records.

The Police Department had withheld all disciplinary records created prior to June 12, 2020, the date of the repeal of Civil Rights Law §50-a (see L 2020, ch 96, §§ 1-4 [eff June 12, 2020]), and all records related to unsubstantiated allegations of misconduct contending that "disciplinary records related to substantiated allegations of misconduct created on or after June 12, 2020, were not required to be released pursuant to Public Officers Law §87(2)(b)".

Plaintiff administratively appealed the denial of its FOIL request. Respondent [Town Board] granted the appeal insofar as the Plaintiff 's FOIL request sought disciplinary records created after the repeal of Civil Rights Law §50-a and directed the Respondent Town Police Department to disclose records of unsubstantiated allegations of misconduct to the extent that those allegations were not otherwise exempt from disclosure pursuant to the provisions of FOIL, noting that Petitioner's FOIL request did not reasonably describe the records requested as required by Public Officers Law §89(3)(a).

Plaintiff then commenced a CPLR Article 78 proceeding to compel the production of all records responsive to its FOIL request. Supreme Court denied the petition and dismissed the proceeding, concluding that the repeal of Civil Rights Law §50-a did not require the Police Department to produce law enforcement disciplinary records created prior to June 12, 2020, and that the Town Board's determination to deny the disclosure of records of unsubstantiated allegations of misconduct was reasonable on the ground that they were exempt from disclosure pursuant to Public Officers Law §87(2)(b), notwithstanding the repeal of Civil Rights Law §50-a.

The Appellate Division, noting that "To promote open government and public accountability, . . . FOIL imposes a broad duty on government to make its records available to the public", citing Gould v New York City Police Dept., 89 NY2d 267., said FOIL provides that, "unless otherwise specifically exempted, all records of a public agency are presumptively open to public inspection and copying". 

As the limited categories of records which may be withheld are enumerated in FOIL, the exemptions are to be narrowly construed and "the burden rests on the agency to demonstrate that the requested material qualifies for exemption". Citing Luongo v Records Access Officer, 161 AD3d at 1080, the Appellate Division opined that "[t]he standard of review in a CPLR article 78 proceeding challenging an agency's denial of a FOIL request is much more stringent than the lenient standard generally applicable to CPLR article 78 review of agency actions".

While the Police Department denied Plaintiff's request for records of unsubstantiated allegations of misconduct, relying, in part on the privacy exemption, the Appellate Division noted that FOIL provides "a nonexclusive list of categories of information that would constitute an unwarranted invasion of personal privacy if disclosed". Further, said the court, "Where an asserted privacy interest is not enumerated, applicability of the exemption is determined by balancing the privacy interests at stake against the public interest in the disclosure of the information" noting that the privacy exemption also supplies statutory authority for certain redactions, citing Public Officers Law §89[2][a]), and it "directs that "disclosure shall not be construed to constitute an unwarranted invasion of personal privacy" when, among other possibilities, identifying details are deleted."

Explaining that the Supreme Court erred in concluding that the privacy exemption under Public Officers Law §87(2)(b) creates a blanket exemption allowing the custodian to withhold the disciplinary records of unsubstantiated allegations and did not articulate any particularized and specific justification for withholding any of the records, the Police Department "did not meet [it's] burden of establishing that the privacy exemption applies. Further, observed the Appellate Division, the Police Department failed to establish that "identifying details" in the records containing unsubstantiated allegations or complaints of misconduct "could not be redacted so as to not constitute an unwarranted invasion of personal privacy", citing Matter of Aron Law, PLLC v New York City Fire Dept., 191 AD3d 664 at 666).

As to Respondents' contention that the repeal of Civil Rights Law §50-a is not retroactive and that all law enforcement disciplinary records created prior to June 12, 2020, are not subject to FOIL disclosure, effective June 12, 2020, the Appellate Division opined that the New York State Legislature repealed Civil Rights Law §50-a and amended the Public Officers Law to make specific provisions relating to the disclosure of law enforcement disciplinary records and the types of redactions to be made thereto prior to disclosure. Accordingly the statutory exemption under Public Officers Law §87(2)(a) no longer applies to law enforcement personnel records. 

The Court also noted that the bill repealing Civil Rights Law §50-a also made several amendments to FOIL concerning disciplinary records of law enforcement agencies, citing the Laws of 2020, Chapter 96, §§ 2-4, calling attention to Public Officers Law §86 which was amended by adding subdivisions (6) and (7), defining "[l]aw enforcement disciplinary records" and a "[l]aw enforcement disciplinary proceeding." 

In addition, the Appellate Division rejected the Respondents' contention that in amending the Public Officers Law to provide for the disclosure of records relating to law enforcement disciplinary proceedings, the Legislature intended to exclude from disclosure any law enforcement disciplinary records that were created prior to June 12, 2020.

The Appellate Division concluded that Supreme Court should have granted that branch of the petition which was to compel the production of the records sought in the Plaintiff's FOIL request.

Click HERE to access the Appellate Division's decision posted on the Internet.

The New York State Department of Civil Service Attendance and Leave Memorandum posted

The New York State Department of Civil Service recently posted the following items on the Internet: 

Advisory Memorandum 2024-03, Designation of Floating Holidays in Lieu of Election Day and Lincoln's Birthday for Contract Year 2024–2025 

The text of Advisory Memorandum 2024-03 is posted on the Internet at: https://www.cs.ny.gov/attendance_leave/AdvMemo24-03.cfm 

The Advisory Memorandum 2024-03 in PDF format is posted on the Internet at: https://www.cs.ny.gov/attendance_leave/AM2024-03.pdf 

Also posted on the Internet is the New York State Department of Civil Service's listing of the 2025 Legal Holidays and Days of Religious Significance at  https://www.cs.ny.gov/attendance_leave/TM_50.cfm 

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

Seeking summary judgment in adjudicating disability discrimination claims

The Circuit Court of Appeals, Second Circuit, held a federal district court improperly granted summary judgment in the instant matter for two reasons, "one of which is a logical consequence of disposing of the matter based on pre-motion letters".

First, Circuit Court said the district court improperly granted summary judgment by resolving disputed facts that related to the Petitioners claims discrimination because of his alleged disability.

The Second Circuit explained: "It is well established that a district court may grant summary judgment only where '... movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. [See] Fed. R. Civ. P. 56(a).' A district court may not make credibility determinations, or weigh evidence in evaluating a motion for summary judgment. See Anderson  v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986) ('Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge . . . .'). Rather, [the Second Circuit has] long stated that '[t]he function of the district court [when] considering the motion for summary judgment is not to resolve disputed questions of fact but only to determine whether, as to any material issue, a genuine factual dispute exists.' Kaytor v. Elec. 20 Boat Corp., 609 F.3d 537, 545 (2d Cir. 2010)."

Second, the Second Circuit said it had concluded that the district court further erred by not ensuring that the evidentiary material cited in the parties’ Rule 56.1 statements support their assertions.

In the words of the Second Circuit: "As this Court has explained, a district court 'may not rely solely on the statement of undisputed facts contained in the moving party’s Rule 56.1 statement.' Vt. Teddy Bear Co. v. BEARGRAM Co., 373 F.3d 241, 244 (2d Cir. 2004). Instead, a district court must satisfy itself "that the citation to evidence in the record supports the assertion.": Id. But, there is nothing in the record to show that the district court possessed or reviewed the evidentiary material cited in the parties’ Rule 56.1 statements. Therefore, we cannot discern whether the district court satisfied itself that the evidence cited in the parties’ Rule 56.1 statements support their assertions, nor can we fulfill our appellate obligations given the incomplete record. This is where a substantive reason for avoiding dismissals based on counsels’ arguments at a pre-motion conference can arise: parties not having yet provided the district court with a complete record to review."

The Circuit Court vacated the district court’s judgment granting summary judgment in favor of the Respondent and remanded the matter to the district court for further proceedings.

Click HERE to access the Second Circuit's decision posted on the Internet.

New York State municipal and school district audits posted

On August 16, 2024, New York State Comptroller Thomas P. DiNapoli announced the following local government and school audits were issued.

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

 

Dutchess County – Contract Monitoring (2023M-142)
County officials did not obtain reasonable assurance that certain services with vendors were provided in accordance with contract terms, and payments were appropriate and supported. As a result, various department officials responsible for overseeing the contracts approved claims totaling approximately $4.5 million without ensuring that required contract progress, outcome and budget reports were provided. The comptroller approved claims totaling approximately $10.5 million without supporting documentation from county departments. Expenditures for one contract exceeded the agreed upon contract amount by $215,395.

Long Beach City School District – Financial Management (Nassau County)
The board and district officials did not effectively manage the district’s fund balance and did not present the district’s spending plans in a transparent and meaningful manner. While real property tax levies remained the same since 2020-21, the district’s budgeting practices resulted in tax levies being higher than necessary. The board and officials reported surplus fund balance that exceeded the statutory 4% limit in three of the four years reviewed by as much as 5 percentage points. The district transferred a total of $17.3 million of the general fund’s excess fund balance at the end of two of the four fiscal years reviewed to the capital projects fund. Prior to the fiscal year-end transfers that totaled about $13.4 million, the surplus fund balance exceeded the statutory limit by as much as 9 percentage points and overestimated appropriations by an average of approximately $2.5 million annually and underestimated revenues by an average of $1.6 million annually for a three-year period.

Delaware Academy Central School District @ Delhi – Financial Management (Delaware County)
The board and district officials failed to properly manage fund balance and reserves. The board and officials’ appropriated fund balance that was not needed and maintained unreasonable reserve balances that circumvented the statutory limit on surplus fund balance and resulted in a real property tax levy that was higher than needed to fund operations. From the 2020-21 through 2022-23 fiscal years, the board and district officials overestimated budgetary appropriations by a total of $5 million (8.6%) and developed budgets that appropriated fund balance to address planned budget gaps totaling approximately $2.5 million. However, the district had operating surpluses totaling approximately $3.2 million and the planned budget gaps were not realized and it reported a surplus fund balance that exceeded the statutory limit by $2.2 million, or 10.4 percentage points, as of June 30, 2023.

Falconer Central School District – Financial Management (Chautauqua County)
Although 2009 and 2016 audits identified that the board and district officials did not properly manage fund balance and reserves, a new audit found officials did not implement corrective action. The board and district officials allowed surplus fund balance to exceed the statutory limit as of June 30, 2023 by 20 percentage points, or $6.1 million and consistently overestimated budgetary appropriations by an annual average of $3.7 million (17%). Officials could not demonstrate that three reserves with balances totaling more than $4 million were properly maintained or reasonably funded.

Southern Westchester Board of Cooperative Educational Service (Westchester County)
BOCES officials did not adequately secure nonstudent network user accounts, maintain complete and accurate information technology (IT) inventory records and develop an IT contingency plan. As a result, BOCES officials cannot ensure that IT systems, which contain personal, private and sensitive information (PPSI), along with physical IT assets, are properly safeguarded from inappropriate use and access. In addition, auditors determined that 101 enabled nonstudent network accounts were no longer needed and, if accessed by attackers, could be used to inappropriately access and view personal, private and sensitive information or disable the network. 16 IT assets could not be traced to or from BOCES’ inventory system and 40 IT assets were not properly recorded in the system.

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