State Comptroller report concluded that the use of local development corporations out of control Source: Office of the State Comptroller

State Comptroller report concluded that the use of local development corporations out of control
Source: Office of the State Comptroller

Citing an on-going pattern of abuse, State Comptroller Thomas P. DiNapoli today proposed a package of reform proposals that would limit local governments’ use of local development corporations (LDCs) and other private entities such as limited liability companies (LLCs).

The suggested reforms would also give the State Comptroller direct audit authority over LDCs, LLCs and similar entities controlled by local governments.

LDCs were originally intended to allow New York's counties, cities, towns, and villages to utilize these entities for economic development purposes and to promote employment opportunities.  Because many activities undertaken by LDCs are exempt from taxation, they are used to construct or rehabilitate industrial or manufacturing plants or to    encourage such businesses to relocate or remain in a particular region.

However, said the Comptroller, current law includes loopholes that allow LDCs to be used for purposes beyond the original intention.

DiNapoli cited several instances in which the use of LDCs and LLCs unnecessarily drove up taxpayer costs, including the use of an LLC by the city of Rochester to purchase a ferry that ended up costing taxpayers nearly $20 million.

The Comptroller’s report, Municipal Use of Local Development Corporations and Other Private Entities is posted on the Internet at:
http://www.osc.state.ny.us/localgov/pubs/research/ldcreport.pdf

Other items from the Comptroller's press office available on the Internet include:

DiNapoli: 101 School Districts Request Surplus Certifications to Use Funds to Make Up State Aid Cuts

State Comptroller Thomas P. DiNapoli’s office today certified the amounts of excess Employee Benefits Accrued Liability Reserve funds (EBALR) held by 95 school districts across the state that can be used by the districts in the 2011-12 school year to make up for $190.6 million in state aid cuts. DiNapoli’s review found the districts’ excess EBALR funds total $148.2 million.


DiNapoli's Office Releases School Audits

New York State Comptroller Thomas P. DiNapoli this week announced his office completed the following audits: the Auburn Enlarged City School District; the Malone Central School District; the Schalmont Central School District; and, the Waterloo Central School District.


DiNapoli's Office Releases Municipal Audits

New York State Comptroller Thomas P. DiNapoli this week announced his office completed the following audits: Village of Akron; the Town of Malta; the Village of Endicott; the Town of Trenton; the Smithtown Special Library District; the Village of Lancaster; the Village of Irvington; the Village of Centre Island; the Bellona Fire District; and an audit on Saving Money on Nursing Home Drug Purchases for various counties.


DiNapoli's Office Releases State Audits

New York State Comptroller Thomas P. DiNapoli this week announced his office completed the following audits: the Beacon City School District; Department of Health, Medicaid Payments for Diabetic Testing Supplies (Follow-Up) (2010-F-42) and, Department of Health, Inappropriate Payments for Vision Care Services Claimed by Dr. Horowitz (Follow-Up) (2010-F-47).
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Unfair labor practices - protected activities

Unfair labor practices - protected activities

CSEA Local 1000 v PERB, 267 AD2d 935

CSEA appealed a determination by the New York State Public Employment Relations Board [PERB] that the Holbrook Fire District did not commit an improper employer practice when it disciplined one of its employees, Jason Feinberg.

The district had filed eight charges against Feinberg, a firehouse attendant, alleging misconduct and, or, incompetence pursuant to Section 75 of the Civil Service Law.

Feinberg was alleged to have “permitted unauthorized personnel in his work area, participated in inappropriate activities during work hours, failed to timely complete certain work assignments and follow standard operating procedures in performing certain work-related activities.”

CSEA filed an improper employer practice charge against the district pursuant to Civil Service Law Section 209-a with PERB on behalf of Feinberg. CSEA contended that the district had filed disciplinary charges against Feinberg “in retaliation for his efforts at organizing a union.”

While CSEA’s charges were pending before PERB, the disciplinary hearing officer issued a report and recommendation finding Feinberg guilty of six of the charges. The penalty recommended by the hearing officer: Feinberg should be terminated from his employment. The District accepted the hearing officer’s findings and recommendations and dismissed Feinberg.

CSEA and the district stipulated that rather than holding a separate hearing, the record of the proceedings conducted in connection with the disciplinary charges would be used by PERB’s Administrative Law Judge (ALJ) in resolving the improper practice charge. Finding that other employees who had engaged in similar misconduct had not been disciplined by the district, the ALJ ruled that the district “had committed an improper practice by discharging Feinberg in retaliation for protected union activities.” PERB reversed its ALJ’s ruling.

PERB said that “the ALJ should have deferred to the findings of the hearing officer that the charges against Feinberg were brought by the District for proper business reasons and not to retaliate against him for his organizing activities”.

The Appellate Division initiated its review of CSEA’s appeal from PERB’s ruling by noting that “the relevant inquiry in a proceeding pursuant to Civil Service Law Section 75 is very different than that in an improper practice proceeding under Civil Service Law Section 209-a.” The court, citing City of Albany v Public Employment Relations Board, 43 NY2d 954, said:

1. In considering an appeal involving Section 75, the focus is upon whether there was cause for the employee’s dismissal.

2. In considering an appeal involving Section 209-a, the focus it is whether the employer‘s action was motivated by anti-union animus and “it is irrelevant ... whether or not cause for the employer’s action in terminating [the employee] actually existed.”

The Appellate Division said that PERB relied upon its policy of deference and the disciplinary hearing officer’s determination when it reversed ALJ’s determination.

However, said the court, its review of the decision in the Section 75 proceeding indicates that the disciplinary hearing officer “did not fully consider the dispositive issue in the improper practice proceeding, i.e., whether Feinberg’s firing was improperly motivated.” Accordingly, the Appellate Division said that “PERB’s deference to the [Section 75] Hearing Officer’s findings as the sole basis in resolving the improper practice charge was inappropriate.”

The Appellate Division annulled PERB’s determination and remanded the case to PERB “for an independent review of the ALJ’s decision of [CSEA’s] improper practice charge in light of all the evidence contained in the record of the Civil Service Section 75 proceeding.”

Extending the probationary period of an individual

Extending the probationary period of an individual

Appeal of Anne M. Christiano, Decisions of the Commissioner of Education, Commissioner’s decision No. 16,217

A “Juul Agreement” between an educator and his or her appointing authority extends the educator’s probationary period rather than terminate the educator at the end of his or her probationary period for not completing his or her probationary period satisfactorily. This is typically done in an effort to provide the educator with an opportunity to improve his or her performance and thereby become eligible for tenure in the position. Such an agreement, when “open, knowing and voluntary,” waives the educator’s right to claim tenure by estoppel.* At the end of the extended probationary period the school district may grant or deny tenure [see Juul v. Board of Educ. of Hempstead UFSD, 76 AD2d 837, affirmed, 55 N.Y.2d 648].**

Anne M. Christiano, then serving as a probationary principal, and the Johnstown City School District had entered into a Juul Agreement. At the end of the extended period of Christiano’s probation the superintendent recommended Christiano for tenure.  The school board, however, voted to reject the superintendent’s recommendation and denied Christiano tenure with the district.

Christiano, alleging that the board acted in bad faith and was arbitrary and capricious in denying her tenure, appealed to the Commissioner, asking that he overturn the school board’s tenure determination and that he remove those members of the board “who voted against granting her tenure.”

After addressing a number of procedural issues, the Commissioner said that with respect to the merits of Christiano’s claim regarding the denial of tenure, Education Law §3012(1)(b) provides that the service of a principal “may be discontinued at any time during the probationary period on the recommendation of the superintendent of schools, by a majority vote of the board of education.”  Further, said the Commissioner, “… a board of education has the unfettered right to terminate a probationary principal’s employment for any reason, unless the employee establishes that he or she was terminated for a constitutionally impermissible reason or in violation of a statutory proscription.”

In any event, in an appeal to the Commissioner the petitioner has the burden of demonstrating a clear legal right to the relief requested and the burden of establishing the facts upon which petitioner seeks relief. In this instance the Commissioner ruled that while there were positive comments in the record about her administrative abilities, Christiano had not alleged or established that she was terminated for a constitutionally impermissible reason or in violation of a statutory proscription.

Accordingly, the Commissioner found that Christiano has failed to meet her burden of proof.

As to Christiano’s petition to remove certain members of the school board, the Commissioner said that she had failed to establish facts sufficient to warrant removal of the individually named board members pursuant to Education Law §306.  The Commissioner pointed out that “A member of the board of education or a school officer may be removed from office pursuant to Education Law §306 when it is proven to the satisfaction of the Commissioner that the board member or school officer has engaged in a willful violation or neglect of duty under the Education Law or has willfully disobeyed a decision, order, rule or regulation of the Board of Regents or Commissioner of Education.”

Finding that Christiano had failed to establish that the individual members of the school board named in her appeal “intentionally acted with a wrongful purpose to disregard a lawful duty or violate a legal requirement,” the Commissioner ruled that she had failed to establish any ground for their removal under Education Law §306.

* A probationary employee may attain tenure by estoppel [sometimes referred to as “tenure by acquiescence”] when the appointing authority accepts the continued services of the individual, but fails to take the action required by law to either grant or deny the individual tenure prior to the expiration of the employee’s probationary term, [see McManus v Hempstead Union Free School District, 87 NY2d 183]. Continuation on the payroll for a brief period after the expiration of a probationary period for administrative convenience, such as to coincide with the end of a payroll period, does not automatically result in the individual attaining tenure by estoppel [Mendez v Valenti, 101 AD2d 612].

** A procedure is available to the appointing authority with respect to probationers in the classified service of the State and public authorities, public benefit corporations and other agencies for which the Civil Service Law is administered by the State Department of Civil Service, provides:. 4 NYCRR 4.5(b) (5)(ii), in pertinent part, permits an appointing authority to offer a probationer deemed not to have satisfactorily completed his or her probationary period an opportunity to serve a second probationary term “in which case the appointment may be made permanent at any time after completion of 12 weeks of service, or the employment [may be] terminated at any time after the completion of 8 weeks of service and on or before the completion of 26 weeks of service.” A similar rule has been adopted by many local civil service commissions.

The Commissioner’s decision is posted on the Internet at:

http://www.counsel.nysed.gov/Decisions/volume50/d16217.htm

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Petitioner alleging disparate treatment in violation of his or her Title VII civil rights has the initial burden of setting out a prima facie case of unlawful discrimination

Petitioner alleging disparate treatment in violation of his or her Title VII civil rights has the initial burden of setting out a prima facie case of unlawful discrimination

Wharff v State Univ. of New York, USCA, Second Circuit, 09-4534-cv

Wilfred Wharff alleged that SUNY refused to promote him from Lab Technologist to Assistant Supervisor because of his gender.

The Circuit Court said that Wharff’s disparate treatment claim pursuant to Title VII [42 USC § 2000e et seq.] was to be analyzed under the tripartite burden shifting framework laid out in McDonnell Douglas Corp. v. Green, 411 U.S. 792, whereby Wharff has the initial burden of establishing a prima facie case of unlawful discrimination.

Citing Malave v. Potter, 320 F.3d 321, the Circuit Court said that “To make out a prima facie case of disparate impact, a plaintiff must ‘(1) identify a policy or practice, (2) demonstrate that a disparity exists, and (3) establish a causal relationship between the two.’

If he is able to do so, the burden shifts to the employer "to articulate some legitimate, nondiscriminatory reason" for its actions.”

Finding that Wharff offered no evidence that SUNY applied its promotion procedures unfairly, that the collective bargaining agreement's sanctioning of the alternate hiring process was negotiated as a pretext for sex discrimination, or that the selection of alternatives was intentionally manipulated to accomplish such discrimination, the Court dismissed his appeal.

Further, said the court, “Even assuming that this establishes a prima facie case of discrimination, SUNY has offered a legitimate, nondiscriminatory reason for its promotion decisions that Wharff has failed to rebut.”

The decision is posted on the Internet at:

http://www.ca2.uscourts.gov/decisions/isysquery/8255044e-0961-4619-a312-4a2d3aa9000d/1/doc/
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Denying employee sick leave bank benefits results in charges of unlawful discrimination

Denying employee sick leave bank benefits results in charges of unlawful discrimination

Cheektowaga CSD v Graziadei, 267 AD2d 985, motion for leave to appeal denied, 95 NY2d 756

A sick leave bank was created by the Cheektowaga Central School District as required by the collective bargaining agreement between district and the Teachers’ Association. Under the terms of the agreement, sick leave bank time was available only to employees incapacitated by severe sickness or injury.

Kathryn A. O. Graziadei, a guidance counselor, had used up all of her sick leave credits after being absent for four weeks and two days following the birth of her child.

Graziadei requested approval to draw three days of sick leave from the sick leave bank. Her request was disapproved by the district because it found that Graziadei did not demonstrate that she was incapacitated by a severe sickness or injury.

Graziadei filed a complaint with the New York State Division of Human Rights alleging that the district had unlawfully discriminated against her because of her gender and a pregnancy-related disability. The district appealed the Division’s ruling that it had unlawfully discriminated against Graziadei.

In reviewing the district’s appeal, the Appellate Division found that Graziadei was entitled to take advantage of the sick leave bank to the same extent as employees who are incapacitated by a medical condition other than pregnancy and recovery from childbirth.

According to the decision, Graziadei failed to present any proof that she was incapacitated by severe sickness or injury, or that her request for leave bank time was treated in a manner less liberal than those applications from employees with conditions unrelated to pregnancy and recovery from childbirth. This omission proved fatal to the Division’s determination.

The Appellate Division annulled the Division’s determination that the district had unlawfully discriminated against Graziadei on the basis of sex and a pregnancy-related disability, holding that the Division’s decision was not supported by substantial evidence.

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Penalties imposed on police officers founds guilty of charges alleging wrongful arrest

Penalties imposed on police officers founds guilty of charges alleging wrongful arrest

Police Department v Popovic, NYC Office of Admin. Trials and Hearings, OATH Index No. 544/00

Administrative disciplinary charges may be filed against a police officer alleging that he or she made an arrest in bad faith. The Popovic decision lists some of the penalties recommended by New York City’s Office of Administrative Trials and Hearings where a police officer is found guilty of such charges.

Penalties for bad faith or retaliatory arrests range from 10 to 30 days, depending upon the degree of infringement of the civilian’s rights. Some examples follow:

1. Loss of 25 vacation days for bad faith arrest in retaliation for complainant’s vulgar retorts to the officers’ provocative behavior;

2. 30 days’ suspension and disciplinary probation for bad faith arrest and strip-search of a civilian;

3. Loss of 10 vacation days for bad faith arrest in retaliation for past incident of arrogance to officers and displaying a falsified license;

4. Loss of 15 vacation days for bad faith arrest following argument about a police report;

5. Loss of 13 vacation days for bad faith arrest after civilian attempted to record the police officer’s badge number.
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A school board member seeking the removal of another member must demonstrate willful misconduct or neglect of duty of the part of the member

A school board member seeking the removal of another member must demonstrate willful misconduct or neglect of duty of the part of the member

Matter of Powell and Elliott, Decisions of the Commissioner of Education, Decision 16,216

Willa Powell, a member of the Board of Education of the Rochester City School District asked the Commissioner to remove another member of the board, Cynthia Elliott, alleging that Elliott had “willful and substantive disclosure of confidential information” acquired in the course of her official duties to a newspaper.

The Commissioner denied Powell’s application.

The Commissioner explained that a member of the board of education or a school officer may be removed from office pursuant to Education Law §306 when it is proven to the satisfaction of the Commissioner that the board member or school officer has engaged in a willful violation or neglect of duty under the Education Law or has willfully disobeyed a decision, order, rule or regulation of the Board of Regents or Commissioner of Education.

To be considered willful, the actions of the individual must have been intentional and with a wrongful purpose.

Here, said the Commissioner, Powell had not met her burden of proving that Elliott had engaged in behavior constituting a willful violation or neglect of duty requiring her removal from office to his satisfaction. As to the evidence advanced by Powell, the Commissioner ruled that the fact that the draft report released to the media “contains a code linked back to the copy intended for [Elliott], does not in itself prove that [Elliott] released it, much less that she intentionally released it.”

The decision is posted on the Internet at:

http://www.counsel.nysed.gov/Decisions/volume50/d16216.htm

The party alleging that an individual has changed his domicile has the burden of proving such a change of the individual’s “permanent place of abode”

The party alleging that an individual has changed his domicile has the burden of proving such a change of the individual’s “permanent place of abode”
Matter of Gigliotti v Bianco, 2011 NY Slip Op 02206, Appellate Division, Fourth Department

The City of Niagara Falls School District terminated the employment of Vincent F. Gigliotti on the grounds that he failed to comply with the District's residency policy, which requires District employees to be domiciliaries of the City of Niagara Falls. Supreme Court properly granted the petition.

It is well established that "domicile means living in [a] locality with intent to make it a fixed and permanent home." As the Court of Appeals said in Matter of Newcomb, 192 NY 238, "For a change to a new domicile to be effected, there must be a union of residence in fact and an absolute and fixed intention to abandon the former and make the new locality a fixed and permanent home."

An individual may have but one domicile at time, i.e., his or her permanent place of abode, which continues until he or she has acquired a new one and any party alleging a change in an individual’s domicile “has the burden to prove the change by clear and convincing evidence."

In contrast, an individual may have multiple places of residence simultaneously, i.e., two or more residences in the same or at different geographical locations in which he or she may, from time to time, live, but only one such residence is his or her domicile.

According to the decision, the Gigliotti, a lifelong resident of Niagara Falls, divorced and while he was temporarily laid off from his position, remarried. Gigliotti and his wife, who owned a home in Ransomville New York, agreed that Gigliotti would continue to live in Niagara Falls with his ailing mother while his spouse would continue to live in her home in Ransomville.

The evidence considered by the Appellate Division in determining Gigliotti’s domicile included Gigliotti’s listing his Niagara Falls address on his federal income tax return forms, his New York State driver's license, his marriage certificate, and his bank and credit statements. In addition, the court noted that Gigliotti’s personal belonging remained at his residence in Niagara Falls, “although he keeps a set of golf clubs and some clothing at his wife's residence in Ransomville.”

The Appellate Division, after considering the evidence, determined that the District’s conclusion that Gigliotti had changed his domicile from Niagara Falls to Ransomville was arbitrary and capricious.

Significantly, the court commented that although the District did not conduct a hearing before terminating Gigliotti’s employment, such a hearing was not "required by statute or law," citing Colton v Berman, 21 NY2d 322 Assuming that the District had provided Gigliotti with an opportunity to show that he or she satisfied the District’s requirement regarding domicile, the problem here was that the court disagreed with the District’s conclusion that Gigliotti was not domiciled in Niagara Falls.

The decision is posted on the Internet at:

http://www.courts.state.ny.us/reporter/3dseries/2011/2011_02206.htm
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