New York State needs better oversight of government Artificial Intelligence [AI] systems

On May 28, 2025, the Albany Times Union published an "op-ed" by New York State Comptroller Thomas P. DiNapoli addressing "the need for tougher oversight of governments use of Artificial Intelligence [AI] systems".

Artificial intelligence has the potential to transform how government operates and delivers services. New York state agencies have used AI companions to help seniors combat social isolation, and the Department of Motor Vehicles is using facial recognition technology to deter identity fraud.

These significant technological advances come with profound ethical, legal and societal questions that have to be addressed. If they aren’t, the very New Yorkers they are meant to help could be put in harm’s way.

That is why my office has called on New York’s leaders to enact robust oversight over government’s uses of AI. We need to be assured that these technologies are used safely, fairly and responsibly. In a recent audit that examined the state’s use of AI, my auditors found clear evidence that New York’s use of AI is running well ahead of the state’s ability to manage it.

AI governance must be baked into the process of agencies’ adoption and use of various technologies. This means having rules, guidelines and practices in place that promote transparency from the start, address the flaws and biases that can come with AI, and instill public accountability.

This year, New York strengthened its AI governance framework with a new law requiring state agencies to disclose the AI tools they use and directing the Office of Information Technology Services to keep a public inventory of AI systems. The law also includes protections for employees.

The state has also recently updated its AI acceptable-use policy, which requires agencies to perform a risk assessment of the AI systems they plan to use, assign a human to oversee it if it makes a decision that affects the public, check its performance and document the outcomes of using it.

These are positive developments, but they are not enough.

Our audit found that agencies lack specific procedures to test the accuracy and fairness of their AI systems. That leaves residents vulnerable to harmful automated decisions. One agency that uses voice biometric software to validate people’s identities had never tested its system’s accuracy. Another agency said it wasn’t using AI because it did not think facial recognition technology was AI - even though it had a facial recognition system that met the state’s definition of AI.

The lack of central oversight, inadequate guidance for agencies, the absence of an AI inventory and insufficient training are at the root of these problems. The result: State agencies are left largely alone to adopt AI and create the rules to govern it.

Unsurprisingly, this creates serious vulnerabilities. For example, when we asked what happens to the data created and collected by the AI companion devices given to seniors, officials said the vendor — not the state agency — owns the data on their performance and the recordings of their interactions. 

Failure to address who owns the data creates significant privacy risks. Agencies could lose the ability to delete the data; the vendor could use the data to develop new products or train models, or could sell it without agency consent; and the data could be exposed to security breaches and the loss of personal information.

Establishing good AI governance will require efforts on several fronts. We need a framework that sets clear boundaries for using AI and guidelines and training that help agencies understand and adhere to these standards. Systems must be tested, and not just by the vendor selling the technology. Testing and oversight have to be continuous as AI evolves.

Regular and independent audits will verify that agencies are living up to standards, checking for vulnerabilities and using what they learn to drive improvements. My office will look at the AI systems used by state agencies to see if they are working and verify that vendors are playing by the rules.

The new law will help increase transparency and accountability, but it will only be effective if it is implemented consistently and backed up by rigorous oversight. Audits help verify that written principles are upheld in practice and that these systems benefit New Yorkers by making government more effective at delivering services.

This strategy not only safeguards against current risks; it also prepares governments to adapt to future advancements and builds confidence that the state is using AI responsibly, ethically and transparently.

 ###

Click on the text highlighted in color to access the Comptroller's TU Op Ed and, or, the audit posted on the Internet.

Times Union Op Ed
Commentary: New York Needs Better Oversight of Government AI Systems

Audit
New York State Artificial Intelligence Governance

Conducting a disciplinary hearing in absentia

Supreme Court denied Plaintiff's petition seeking to annul a determination by the New York City Civil Service Commission [CSC] affirming the appointing authority's decision to impose the penalty of termination on the Plaintiff following a disciplinary hearing "conducted in absentia". Supreme Court also granted a cross-motion to dismiss the Plaintiff's petition. 

The Appellate Division unanimously affirmed the Supreme Court's ruling, without costs.

Citing Matter of Centeno v City of New York, 115 AD3d 537, the Appellate Division explained that Plaintiff's constitutional arguments, which are his only arguments reviewable under the "extremely narrow scope of review applicable" to CSC determinations, were unpreserved as Plaintiff's brief submitted to the CSC "never protested that [his] constitutional rights were being violated," and "[the Appellate Division said it] has 'no discretionary authority' to 'reach[] an unpreserved issue in the interest of justice' in an article 78 proceeding ... including issues touching on due process".

With respect to conducting a disciplinary hearing in absentia, New York courts have held that such a disciplinary hearing may proceed and the employee tried in absentia provided the appointing authority has complied with a number of procedural steps, including the following:

1. The appointing authority must properly serve the employee with the disciplinary charges and advise him or her, among other things, of the date, time and place of the hearing.

2. A diligent effort to contact the individual to determine if he or she has a reasonable explanation for his or her absence from the scheduled disciplinary hearing must be made before the hearing officer proceeds to conduct the hearing in the absence of the accused employee even if the employee had earlier advised the appointing authority or the hearing officer that he or she will not participate in the disciplinary hearing.

3. A formal disciplinary hearing must be conducted and the appointing authority is required to introduce evidence proving the charges and specifications served on the employee to the hearing officer.

4. A formal record of the hearing must be made and a transcript provided to the appointing authority and, if requested, to the employee.

5. The employee must be advised of the appointing authority’s determination and of the employee's right to appeal if he or she has been found guilty of one or more of the charges and specifications considered at the disciplinary hearing conducted in absentia.

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

Dismissed lawsuit alleging breach of contract brought by retired teachers, not teachers as defined in the collective bargaining agreement, reinstated

  

In this action seeking to recover damages for an alleged breach of contract, the plaintiffs/petitioners, who are retirees of the school district, appealed from an order and judgment by a Supreme Court granting the school district motion to dismiss the plaintiffs'/retirees' amended complaint-petition and dismissed their action-proceeding. The plaintiffs/petitioners appealed the Supreme Court's ruling.

The Appellate Division directed that the Supreme Court's order and judgment be modified, on the law, noting Supreme Court erred in dismissing the breach of contract cause of action insofar as asserted by the plaintiffs [other than one who was not an employee of the school district] "for failure to exhaust administrative remedies". 

Typically an employee covered by a Collective Bargaining Agreement [CBA] that provides for a grievance procedure must exhaust his or her administrative remedies prior to seeking judicial redress. 

Here, however, the Appellate Division noted that "the failure of the plaintiffs [other than the one identifies as not being an employee of the school district] to pursue the grievance procedure as outlined in the CBA did not warrant dismissal of the breach of contract cause of action insofar as asserted by them, since the grievance procedure outlined in the CBA applied only to 'teachers,' defined as members of the bargaining unit employed during the regular school year". 

Citing Armstrong v Town of Tonawanda, 214 AD3d 1304, and Meyer v City of Long Beach, 165 AD3d 649, the Appellate Division opined that plaintiffs, who were retirees and not teachers as defined in the CBA, could not have initiated a "contract grievance" before commencing the instant action.

The Appellate Division's decision is set out below:

Chappaqua Congress of Teachers v Board of Educ. of the Chappaqua Cent. Sch. Dist.

2025 NY Slip Op 02907

Decided on May 14, 2025

Appellate Division, Second Department

Published by New York State Law Reporting Bureau pursuant to Judiciary Law § 431.

This opinion is uncorrected and subject to revision before publication in the Official Reports.

Decided on May 14, 2025 SUPREME COURT OF THE STATE OF NEW YORK Appellate Division, Second Judicial Department
BETSY BARROS, J.P.
PAUL WOOTEN
DEBORAH A. DOWLING
CARL J. LANDICINO, JJ.

2023-05014
(Index No. 58551/22)

[*1]Chappaqua Congress of Teachers, et al., appellants,

v

Board of Education of the Chappaqua Central School District, et al., respondents.

Robert T. Reilly, New York, NY (Oriana Vigliotti, Hannah Weinstein-Ammann, and Matthew E. Bergeron of counsel), for appellants.

Shaw, Perelson, May & Lambert, LLP, Poughkeepsie, NY (David S. Shaw and Mark C. Rushfield of counsel), for respondents.

DECISION & ORDER

In a hybrid action to recover damages for breach of contract and proceeding pursuant to CPLR article 78, the plaintiffs/petitioners appeal from an order and judgment (one paper) of the Supreme Court, Westchester County (Susan Cacace, J.), dated April 3, 2023. The order and judgment granted the defendants/respondents' motion pursuant to CPLR 3211(a) and 7804(f) to dismiss the amended complaint/petition and dismissed the action/proceeding.

ORDERED that the order and judgment is modified, on the law, by deleting the provisions thereof granting that branch of the defendants/respondents' motion which was to dismiss the cause of action to recover damages for breach of contract insofar as asserted by the plaintiffs/petitioners Chappaqua Congress of Teachers, Michael Debellis, Bonnie Mitchell, Gerard Sulli, Laura Triglia, Felice Gittelman, Patricia Greco, Leslie Feldman, Anita Lorraine Jones, Theresa Zuckerberg, Virginia Munoz, Melanie Weinstein, Patricia Pollock, Sandy Kowalski, Jing Chen, Michael Bierbauer, Maryse Santini, Susan Constantini, Susan Johnson, Mary Coleman, Joelen Donohue, Genevieve Hanlon, Patricia Wolff, Jeffrey Knisely, Barbara Fingeroth, Sharon Boyce, Carol Hughes, Ann Lertora, Janet Fletcher, Katheryn Ward, Anne Bonington, Phyllis Bellofatto, and Martin Hughto, and dismissing that cause of action insofar as asserted by those plaintiffs/petitioners, and substituting therefor a provision denying that branch of the motion; as so modified, the order and judgment is affirmed, without costs or disbursements, and the cause of action to recover damages for breach of contract insofar as asserted by those plaintiffs/petitioners is reinstated.

Pursuant to collective bargaining agreements (hereinafter CBA) between the Chappaqua Central School District (hereinafter the District) and the Chappaqua Congress of Teachers (hereinafter the CCT), an association representing District employees, the District agreed to provide healthcare benefits for active and retired employees and their spouses. Retired employees over age 65 were required to enroll in a Medicare Part B program, and, in keeping with the CBAs, the District reimbursed retirees the cost of Medicare Part B coverage. Some retirees, based upon their household income, were subject to a surcharge in addition to the standard Medicare Part B premium, known as the income-related monthly adjustment amount (hereinafter IRMAA). Prior to August 2018, the District reimbursed retirees for IRMAA surcharges in addition to the standard [*2]premium cost.

On August 16, 2018, the District informed retirees that it would no longer reimburse them for IRMAA surcharges. In response, numerous retirees commenced a proceeding pursuant to CPLR article 78 against the Board of Education of the Chappaqua Central School District, the District, and Christine Ackerman, as superintendent of the District, seeking to annul the August 16, 2018 determination on the ground that it violated chapter 729 of the Laws of 1994 (as amended by L 2007, ch 22), known as the Retiree Health Insurance Moratorium Act (hereinafter the moratorium statute), and seeking reinstatement of the reimbursements. The Supreme Court determined that the District's discontinuation of reimbursements violated the moratorium statute, granted the petition, and directed the District to reinstate the reimbursement, including retroactive reimbursements. This Court affirmed the Supreme Court's determination (see Matter of Bailenson v Boad of Educ. of the Chappaqua Cent. Sch. Dist., 194 AD3d 1039, 1040).

During the course of that proceeding, the District and the CCT entered into a memorandum of agreement (hereinafter MOA) on December 14, 2020, wherein they agreed to incorporate the provisions of their 2018-2021 CBA into a one-year successor agreement, effective July 1, 2021, and terminating on June 30, 2022, except as modified, inter alia, by adding the following language to the agreement: "The District's sole obligation to reimburse unit members who retire and their spouses, where applicable, on or after July 1, 2021 shall be for Medicare Part B payments at the standard rate." The District, for the period beginning on July 1, 2021, began reimbursing all of its retired employees and their spouses (with the exception of the Bailenson petitioners) for the standard premium only, but not the IRMAA surcharges.

On March 31, 2022, the CCT and its then president, Miriam Longobardi, commenced this hybrid action to recover damages for breach of contract and proceeding pursuant to CPLR article 78, contending that the District was required under the MOA to reimburse all retirees who retired before July 1, 2021, for the full amount of their Medicare Part B premiums, including the IRMAA surcharge. Thereafter, on November 15, 2022, an amended complaint/petition was filed by the plaintiffs/petitioners (hereinafter the plaintiffs), the CCT, Michael Debellis in place of Longobardi as the president of the CCT, and 32 allegedly retired former employees of the District who retired prior to July 1, 2021 (hereinafter the individual plaintiffs). The defendants/respondents (hereinafter the defendants) moved pursuant to CPLR 3211(a) and 7804(f) to dismiss the amended complaint/petition. The Supreme Court granted the motion and dismissed the action/proceeding. The plaintiffs appeal.

Contrary to the plaintiffs' contention, the Supreme Court correctly determined that the CCT and Debellis lacked standing to maintain the proceeding pursuant to CPLR article 78. "To establish standing, an organizational plaintiff . . . must show that at least one of its members would have standing to sue, that it is representative of the organizational purposes it asserts and that the case would not require the participation of individual members" (New York State Assn. of Nurse Anesthetists v Novello, 2 NY3d 207, 211). Here, the CCT represents only current employees, and not retirees, of the District. Current employees represented by the CCT were not affected by the District's determination, since it was adverse only to retirees who retired before July 1, 2021. Since only retirees are affected, the CCT did not show that any of its members would have standing to sue or that its mission makes it an appropriate representative of the plaintiffs' interests, and thus, the CCT cannot maintain associational or organizational standing (cf. Matter of Aeneas McDonald Police Benevolent Assn. v City of Geneva, 92 NY2d 326, 331). The court also properly granted dismissal of the amended complaint/petition insofar as asserted by Gail Read, since the defendants established, and the plaintiffs did not oppose, that Read was never a District employee.

The Supreme Court properly determined that the CPLR article 78 proceeding insofar as asserted by the individual plaintiffs other than Read was barred by the statute of limitations. A challenge to an administrative determination must be commenced within four months of the time the determination is "final and binding upon the petitioner" (CPLR 217[1]). "A determination becomes final and binding upon the petitioner when the petitioner receives notice that the agency has reached a definitive position on the issue that inflicts actual, concrete injury and . . . the injury [*3]inflicted may not be prevented or significantly ameliorated by further administrative action or by steps available to the [petitioner]" (Matter of Hepco Plumbing & Heating v New York City Dept. of Bldgs., 227 AD3d 903, 905 [internal quotation marks omitted]; see Matter of Best Payphones, Inc. v Department of Info. Tech. & Telecom. of City of N.Y., 5 NY3d 30, 34). "The relation back doctrine 'enables a plaintiff to correct a pleading error—by adding either a new claim or a new party—after the statutory limitations period has expired,' and gives courts the 'sound judicial discretion to identify cases that justify relaxation of limitations strictures . . . to facilitate decisions on the merits if the correction will not cause undue prejudice to the plaintiff's adversary'" (Catnap, LLC v Cammeby's Mgt. Co., LLC, 170 AD3d 1103, 1106, quoting Buran v Coupal, 87 NY2d 173, 177-178). "A claim asserted in an amended pleading is deemed to have been interposed at the time the claims in the original pleading were interposed, unless the original pleading does not give notice of the transactions, occurrences, or series of transactions or occurrences, to be proved pursuant to the amended pleading" (CPLR 203[f]). The relation back doctrine "applies only in those cases where a valid preexisting action has been filed" (U.S. Bank N.A. v DLJ Mtge. Capital, Inc., 33 NY3d 84, 90).

Here, the plaintiffs challenged the District's determination to cease reimbursement of the IRMAA surcharges on or after July 1, 2021, a determination that was not communicated to the individual plaintiffs other than Read until mid-December 2021, when checks from the District reimbursing the individual plaintiffs' standard Medicare Part B payments, but not the IRMAA surcharge, were mailed. The amended complaint/petition, which added the individual plaintiffs as parties, was not filed until November 2022, after the four-month statute of limitations period had expired. Contrary to the plaintiffs' contention, because the CCT and its then president lacked standing to bring the CPLR article 78 claims in the original complaint/petition, there was no "valid preexisting action" upon which the CPLR article 78 claims in the amended complaint/petition could relate back (U.S. Bank N.A. v DLJ Mtge. Capital, Inc., 33 NY3d at 90).

However, the Supreme Court erred in determining that the CCT and Debellis lacked standing to maintain the breach of contract cause of action. Since the CCT was a party to the MOA, the District's alleged refusal to pay retiree benefits under that agreement will injure the CCT by depriving it of the benefit of its bargain, and thus, the CCT has standing to sue for breach of the MOA regardless of whether the benefit accrued to third parties, namely, the retirees (see United Steel, Paper & Forestry, Rubber, Mfg., Energy, Allied Indus. & Serv. Workers Intl. Union, AFL-CIO/CLC v Cookson Am., Inc., 710 F3d 470, 474-475 [2d Cir]; see e.g. Civil Serv. Empls. Assn., Inc. v Plainedge Union Free School Dist., 12 AD3d 395, 395-396).

The Supreme Court additionally erred in dismissing the breach of contract cause of action insofar as asserted by the plaintiffs other than Read for failure to exhaust administrative remedies. Generally, an employee covered by a CBA that provides for a grievance procedure must exhaust administrative remedies prior to seeking judicial remedies (see Murray v Town of N. Castle, N.Y., 203 AD3d 150, 172; Spano v Kings Park Cent. School Dist., 61 AD3d 666, 670-671). Thus, "when an employer and a union enter into a collective bargaining agreement that creates a grievance procedure, an employee subject to the agreement may not sue the employer directly for breach of that agreement but must proceed, through the union, in accordance with the contract" (Matter of Board of Educ., Commack Union Free School Dist. v Ambach, 70 NY2d 501, 508; see Murray v Town of N. Castle, N.Y., 203 AD3d at 175).

Here, the failure of the plaintiffs other than Read to pursue the grievance procedure as outlined in the CBA did not warrant dismissal of the breach of contract cause of action insofar as asserted by them, since the grievance procedure outlined in the CBA applied only to "teachers," defined as members of the bargaining unit employed during the regular school year. Thus, the individual plaintiffs, who were retirees and not teachers as defined in the CBA, could not have pursued a grievance before commencing this action (see Armstrong v Town of Tonawanda, 214 AD3d 1304, 1305; Meyer v City of Long Beach, 165 AD3d 649, 650).

BARROS, J.P., WOOTEN, DOWLING and LANDICINO, JJ., concur.

ENTER:

Darrell M. Joseph

Clerk of the Court

Former treasurer of the Essex County Agricultural Society and former Willsboro town clerk/tax collector, pleaded guilty to stealing nearly $90,000 in funds from the society and the town

On May 28, 2025, New York State Comptroller Thomas P. DiNapoli, Franklin County District Attorney Elizabeth Crawford and New York State Police Superintendent Steven G. James announced that Bridget Brown, the former treasurer of the Essex County Agricultural Society and former Willsboro town clerk/tax collector, pleaded guilty to stealing nearly $90,000 in funds from the society and the town.

“Bridget Brown exploited the trust of her community and used her two positions to enrich herself at taxpayer expense,” DiNapoli said. “My thanks to Franklin County District Attorney Crawford and Superintendent James for their partnership in fighting public corruption and holding Bridget Brown accountable.”

The Franklin County District Attorney’s Office served as special prosecutor, with Executive Assistant District Attorney Alyxandra Stanczak assigned.

“Thanks to the Comptroller’s Office, especially the forensic analysts and the attorneys who provided their time and expertise through the investigation, indictment, and in preparation for trial,” Crawford said. “As public officials ourselves, we understand the trust placed in government organizations. We are proud to uphold our oaths to bring a just result to this case — holding Bridget Brown accountable for her betrayal of the public trust when she used her position as tax assessor and town clerk to steal from the taxpayers of the Town of Willsboro. Ms. Brown also financially decimated the Essex County Fair, having now been convicted of stealing over $50,000 from that organization. The Fair is a summer destination for the community and by the community. The fair has thankfully been able to persist despite Ms. Brown’s theft. As a part of her negotiated plea agreement and her conditions of probation, Ms. Brown will be required to pay full restitution back to the Town and the Fair.”

“Ms. Brown violated the public trust by disregarding the law and stealing funds she was not entitled to,” James said. “We will continue to aggressively investigate any case that involves public corruption. I want to commend our State Police members, the Comptroller’s Office, and Franklin County District Attorney’s Office for their assistance in making sure she will no longer be able to take advantage of those who put their trust in her.”

The Essex County Agricultural Society is a non-profit organization whose mission is to encourage and promote agriculture in young children and adults through the Essex County Fair. Brown worked for the society from 2013 to 2019. She also separately served as Willsboro town clerk/tax collector from 2014 to 2021, having lost election in 2021.

Investigators found that while employed with the society, Brown overpaid herself and made unauthorized ATM withdrawals and personal purchases using the society’s bank account. She also used $5,300 of society funds to repay a personal loan. To facilitate her theft, she falsified the fair’s business records. She also obtained an unauthorized $20,000 loan on behalf of the fair, which the society’s board was unaware of and did not approve, in order to cover up her theft. In total, she is accused of stealing approximately $60,000 from the society.

In light of her actions as the fair treasurer, an examination was launched into her activities in the Town of Willsboro.  An investigation and forensic audit determined that during Brown’s tenure as town clerk/tax collector, she stole approximately $29,000 from taxes, licenses, and landfill fees by pocketing cash payments rather than depositing the funds into the town’s account. The forensic analysis revealed that on certain days when Brown collected cash for the town there were corresponding nearly identical cash deposits into her personal bank account.  

Brown pled guilty to grand larceny in the second degree in relation to the funds stolen from the fair and grand larceny in the third degree as a crime of public corruption related to the theft from Willsboro before Judge Tatiana Coffinger in Essex County Court. Her sentencing is scheduled for July 25, 2025.

###

Since taking office in 2007, DiNapoli has committed to fighting public corruption and encourages the public to help fight fraud and abuse. New Yorkers can report allegations of fraud involving taxpayer money by calling the toll-free Fraud Hotline at 1-888-672-4555, by mailing a complaint to the Office of the State Comptroller, Division of Investigations, 8th Floor, 110 State St., Albany, NY 12236 or by filing a complaint online at https://www.osc.state.ny.us/investigations.

For the purposes of eligibility for unemployment insurance benefits, leaving employment without a firm job offer such as a start date for that new employment, does not constitute leaving for good cause

In this appeal of a decision by the Unemployment Insurance Appeal Board, [Board], the Appellate Division sustained the Board's decision disqualifying an applicant [Claimant] for unemployment insurance benefits "because she voluntarily left her employment without good cause".

Claimant had advised her then employer [Employer] that she had been accepted into nursing school and the then Employer told Claimant that although she could not continue in her present full-time position while attending school, a per diem position could be created for her. 

Claimant began classes and was advised by the Employer that it "would need a resignation letter" stating her last day of work. Claimant submitted a letter on September 12, resigning effective September 27, following her use of certain accrued leave. 

Claimant had indicated that she had resigned with the understanding that, "in accordance with the [then Employer's] general policy, the per diem position had to be approved and posted prior to her being able to apply for it, and no set start date or salary for the position had been determined".

Some two weeks after her resignation was effective the per diem position had not yet been posted and Claimant applied for unemployment insurance benefits.

Claimant received one payment of benefits before the Department of Labor issued an initial determination finding that Claimant was disqualified from receiving unemployment insurance benefits because she had voluntarily separated from her employment without good cause and charged her with a recoverable overpayment. 

At the hearing which followed, the Employer explained that organization-wide delays with getting new positions posted and maintained that Employer was committed to formally hiring Claimant for the per diem role once the administrative process was complete and the position could be posted. 

Ultimately Claimant was formally hired for the per diem position but while the instant appeal to the Appellate Division and the Board application were pending, the Board reopened the matter on its own motion and affirmed the Administrative Law Judge's decision on the merits.

With respect to Claimants appeal to the Appellate Division, the Appellate Division affirmed the Board's decision, explaining "Whether a claimant has good cause to leave employment is a factual issue for the Board to resolve, and its determination will be upheld if supported by substantial evidence". 

Further, the Appellate Division, citing Matter of Martinez [Commissioner of Labor], 222 AD3d 1099, explained "It is well established that resigning from a position in order to pursue academic studies, while commendable, constitutes a personal and non-compelling reason for separating from one's employment, disqualifying a claimant from receiving unemployment insurance benefits".  The Appellate Division's decision then observed that "leaving employment without a firm job offer, most significantly here a start date for that new employment, does not constitute good cause."

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

A member of the New York State Employees' Retirement System must be a bona fide retiree in order to be eligible to receive retirement benefits from the system

The Petitioner in this action appealed the denial of his application for Retirement and Social Security Law Article 15 service retirement benefits by the New York State and Local Retirement System [ERS].

Petitioner worked as a correction officer for the Department of Corrections and Community Supervision for over 34 years, resigning from that position in April 2021. Petitioner, however, had commenced working for the Granville Central School District as a school bus monitor in March 2021. 

On May 13, 2021, Petitioner filed an application with ERS seeking service retirement benefits with the school district pursuant to Retirement and Social Security Law Article 15, indicating an effective retirement date of May 15, 2021. Petitioner also advised the school district that he was retiring on May 15 "with the intent of continuing [his] employment" with the school district. 

Ultimately Petitioner resigned from his position as a bus monitor on October 15, 2021, for health reasons, but continued to work for the school district as a consultant.

In May 2019, the New York State's Retirement System's Pension Integrity Bureau [Bureau] commenced investigating retirement applications submitted by individuals who had predominantly worked as correction officers but were seeking benefits under Retirement and Social Security Law Article 15. In a letter dated February 2, 2022, the Bureau informed Petitioner that, after reviewing his application, he was "not eligible to retire under the article 15 plan as of the effective date of [his] retirement (i.e., May 15, 2021) because [he] did not have a bona fide termination from employment." 

Following a hearing, the Hearing Officer denied Petitioner's application, finding, among other things, that Petitioner had not demonstrated that he had a bona fide termination of his employment. The Comptroller affirmed the Hearing Officer's findings and decision. Petitioner then initiated the instant CPLR Article 78 proceeding challenging the Comptroller's decision.

The Appellate Division, noting that:

1. "The Comptroller has exclusive authority to determine all applications for retirement benefits and the determination must be upheld if the interpretation of the controlling retirement statute is reasonable and the underlying factual findings are supported by substantial evidence"; and 

 2. The Retirement and Social Security Law Article 15 does not define the term "retirement,"; explained it employed the commonly understood meaning of the term, which is "to withdraw from one's position or occupation" or to "conclude one's working or professional career", quoting Merriam-Webster Dictionary's definition of "retirement".

Sustaining the Comptroller's interpretation that an applicant for Retirement and Social Security Law Article 15 benefits "must demonstrate that he or she actually retired from public service employment in the first instance" and concluding "that it is entirely rational and reasonable for [the Comptroller] to require that such retirement be genuine, i.e., the applicant must demonstrate that there has been a legitimate cessation or termination of employment.

Opining that "... the Comptroller's reasonable interpretation that applicants for Retirement and Social Security Law article 15 benefits demonstrate a legitimate cessation or termination of employment prior to re-employment does not constitute fraud, misrepresentation, deception or similar misconduct in order to implicate the exception allowing the doctrine of estoppel to be invoked against a state agency, held that "substantial evidence supports the Comptroller's determination that [Petitioner] was ineligible for benefits because he did not actually retire from service on May 15, 2021".

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

Courts Are Facing an Artificial Intelligence Tidal Wave

Judges have been facing making decisions concerning the admission of Artificial Intelligence [AI] created evidence at trial with increasing frequency. This issue is the focus of a recent article posted on the Internet by Rochester attorney Nicole Black, initially published in her column in The Daily Record.

Click HERE to access Ms. Black's article.