New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending December 17, 2016

New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending December 17, 2016 

Source: Office of the State Comptroller

Links to material posted on the Internet highlighted in COLOR.

Waterville Central School District praised in State Comptroller's audit 

 Waterville Central School District, located in Oneida County, is conducting necessary background checks and fingerprinting of employees prior to allowing them to work with students, according to an audit released by New York State Comptroller Thomas P. DiNapoli.

 

 DiNapoli calls for state procurement reform 

On December 13, 2016 New York State Comptroller Thomas P. DiNapoli proposed changes to New York state’s procurement practices in the wake of criminal charges and allegations of corruption in the awarding of contracts for state economic development projects.

“The alleged contracting and kickback schemes uncovered by federal and state prosecutors show lax oversight over economic development spending,” DiNapoli said. “The state funneled taxpayer money to quasi-government organizations, avoiding scrutiny and sidestepping usual procurement practices. This created an environment ripe for self-dealing and abuse. New York State must take credible steps to reestablish the public’s faith in government and address the broader problems.”

By state law, the Comptroller’s office is responsible for reviewing and approving state agency contracts above $50,000 and certain contracts over $1 million for state public authorities. The Comptroller’s independent oversight helps ensure that the process is fair and gets the best value for taxpayer dollars. In 2015, the Comptroller’s office reviewed 21,381 contract transactions totaling $169.2 billion.

In recent years, executive and legislative actions have eroded the Comptroller’s contract oversight. In 2011, this oversight was eliminated for construction and construction-related services contracts, among other purchases, issued by the State University of New York (SUNY) and City University of New York (CUNY). In 2012, the Comptroller’s oversight of Office of General Services (OGS) centralized contracts was removed.

In 2015, state agencies issued over $6.8 billion in contracts without Comptroller review.

DiNapoli’s comprehensive package of reforms increases independent oversight of contracts, prohibits the state from using state-affiliated not-for-profits to do state business, makes procurement requirements uniform, and toughens ethics and transparency rules. Specific proposals include:

• Restore the Comptroller’s independent oversight for SUNY, CUNY and OGS centralized contracts. Recent allegations show widespread weaknesses in SUNY’s procurement process and lax oversight of its affiliated not-for-profits. Restoring systemic checks and balances taken away from the Comptroller can help prevent future abuses and ensure that everyone is following the same rules.

 

• Prohibit the use of not-for-profits to bypass procurement laws and transparency. All contracts for state spending should either be held directly by a state agency or public authority and subject to independent oversight. SUNY’s affiliated not-for-profits had lax oversight and poor processes in place that appear to have been manipulated in multiple ways, allowing a non-competitive contracting process to occur and business to be directed to preferred contractors. These entities should not be used for state business or to bypass the routine and well-tested rules and regulations that state agencies follow.

• Require state public authorities to follow the same procurement requirements as state agencies. The procurement rules and approval process are not the same for every entity entrusted with taxpayer funds. Public authorities can adopt their own internal guidelines and do not have to follow state agency requirements clearly set out in law. Having everyone follow uniform requirements helps give assurance of competition, fairness and best value for taxpayers.

• Review contracts over $1 million for the Research Foundation of SUNY.Currently, the Research Foundation is not required to have any independent review of its contracts, which DiNapoli would change. He proposes that his office review contracts over $1 million funded with state dollars.

• Create tougher ethics requirements and penalties for those who abuse the procurement process. DiNapoli would strengthen disclosure of conflicts for employees of state agencies or public authorities, as well as board members and others, engaged in the process. He also wants to prohibit vendors who have violated procurement law from getting state business and create a code of ethics for vendors doing business with the state.

• Increase transparency. To assure a level playing field for all potential vendors, DiNapoli would require state agencies, public authorities and their affiliates to publish in the State Contract Reporter all potential business opportunities, including notice of single or sole-source procurements.

In early November, 2016, DiNapoli took administrative actions related to the bid-rigging and fraud scandal. He put the Empire State Development Corp. (ESD) on notice that any SUNY Polytechnic Institute contracts transferred or assigned to ESD must be submitted to his office for review. He made a series of recommendations to improve the payment process for economic development projects to help prevent against fraud and address the long delays that have occurred with payments made by ESD for projects. He lowered the threshold requirements for review of contracts from $250,000 to $50,000 for SUNY Poly’s contracts and put public authorities on notice of his plan to watch them closely.

As government contracting has grown in size, scope and complexity, the Comptroller’s oversight, which was established more than 100 years ago, has become more important than ever. While DiNapoli’s office legally has 90 days to review contracts, on the average the decision to approve or reject a proposed contract is issued within nine days. The Comptroller's office is also committed to a high level of transparency and releases a monthly press release disclosing major state contracts and spending approved by his office. It also issues a detailed annual report, “State Contracts by the Numbers,” to inform the public and policymakers of actions taken.

Read DiNapoli’s letter to executive and lawmakers, or go to: http://www.osc.state.ny.us/reports/economic/cuomo_procurement_legislation.pdf

Read the bill memo, or go to: http://www.osc.state.ny.us/legislation/2015-16/oscb_nyspia_memo.pdf

Read the legislation, or go to: http://www.osc.state.ny.us/legislation/2015-16/oscb_nyspia.pdf

Read “State Contracts by the Numbers,” or go to: http://www.osc.state.ny.us/reports/economic/state_contracts_2016.pdf  

Daughter sentenced for stealing her deceased father's retirement benefits 

New York State Comptroller Thomas DiNapoli and Attorney General Eric T. Schneiderman announced that Renee Kanas, a resident of Tamarac, Florida, was sentenced in Albany County Supreme Court to 6 months incarceration and 5 years of probation for stealing over $148,000 in New York state pension benefits.  Kanas pleaded guilty to Grand Larceny in the Third Degree, a class D felony, in June 2016.  

Kanas had concealed her father’s death in March 2010 from the New York State and Local Employees Retirement System, and continued to collect his pension benefits for over four years.  Kanas was sentenced for stealing pension benefits intended for her father, Jacob Yudenfreund, from March 2010 through January 2015.  In total, Kanas stole $148,092.24 by accessing a joint bank account she held with her deceased father, liquidating all but $1,207.55 from the account. During this time period, Kanas lived off of the stolen money and, among other things, took multiple cruises, including to the Caribbean.

In May 2016, Kanas was arrested on a warrant by the city of Tamarac Road Patrol and Broward County Sherriff’s in Florida.  After being brought to Albany County, New York to face these charges, in June 2016, Kanas pleaded guilty before Honorable Thomas A. Breslin in Albany Supreme Court. Today, she was sentenced to 6 months incarceration and 5 years of probation, $45,000 in restitution to New York State, and signed a confession of judgment for the remaining amount stolen of $103,092.24.

The investigation was conducted by the New York State Comptroller’s Division of Investigations and the Attorney General. This case is the latest joint investigation under the Operation Integrity partnership of the Attorney General and Comptroller, which to date has resulted in dozens of convictions and more than $11 million in restitution.  Attorney General Schneiderman and Comptroller DiNapoli thank the city of Tamarac Road Patrol and Broward County Sheriff’s in Florida for their assistance.

The Comptroller’s investigation was conducted by the Comptroller’s Division of Investigations, working with the New York State and Local Retirement System. 

The Attorney General’s investigation was conducted by Investigator Mark Spencer, Investigator Casey Quinlan and Deputy Chief Antoine Karam. Forensic accounting was performed by Associate Forensic Auditor Meaghan Scovello. The Investigations Bureau is led by Chief Dominick Zarrella. The Forensic Audit Section is led by Chief Auditor Edward J. Keegan.

This case was prosecuted by Assistant Attorney General Philip V. Apruzzese of the Criminal Enforcement and Financial Crimes Bureau.  The Criminal Enforcement and Financial Crimes Bureau is led by Bureau Chief Gary T. Fishman and Deputy Bureau Chief Stephanie Swenton. 

Audits and Reports
 

Office for People With Developmental Disabilities: The Association of Neurologically Impaired Brain Injured Children, Inc. Compliance With the Consolidated Fiscal Reporting and Claiming Manual (2013-S-60)

Auditors examined whether the costs claimed by the Association for Neurologically Impaired Brain Injured Children Inc. were valid and consistent with contract terms and were properly allocated among the various programs funded by New York City, New York state, and other sources. For the three fiscal years ended June 30, 2013, auditors identified $493,172 in claimed costs that did not comply with state requirements and recommend such costs be disallowed. Among the ineligible charges identified were: $208,063 in facility-related costs for shared space, $152,500 for unallowable payments for lobbyist services; and $48,802 for unsupported and duplicate payments to a contractor.

Department of Health (DOH): Facility Structure, Safety, and Health Code Waivers (Follow-Up) (2016-F-11)
An initial audit issued in June 2015 found DOH’s waiver practices did not effectively ensure that safety and structural risks related to physical plant standards at health care facilities were appropriately addressed. In a follow-up report, auditors determined DOH officials have made significant progress in addressing the problems identified in the initial audit. The initial report’s four recommendations were all implemented.

Department of Health: Medicaid Overpayments for Certain Medicare Part C Claims (Follow-Up) (2016-F-18)

An initial audit report released in January 2015 identified 5,571 Medicare Part C claims that either had unreasonably high patient cost-sharing amounts or indicated UnitedHealthcare did not cover the service. Auditors reviewed 125 Medicaid claims totaling $151,069 and found Medicaid overpaid 54 claims (43.2 percent) by $61,711. In a follow-up, auditors determined DOH officials have made progress implementing the recommendations made in the initial audit, which included recovering overpayments and instructing providers to bill Medicare Part C claims in accordance with the existing requirements.

 

Department of Health: Improper Payments to a Physical Therapist (Follow-Up) (2016-F-7)
An initial audit issued in December 2014 found that Medicaid overpaid a physical therapist $146,225 for 3,837 claims that were submitted to the Medicaid program with incorrect Medicare payment information. In addition, the audit questioned the propriety of 5,634 claims totaling $158,990 because the therapist submitted claims using his National Provider Identifier for services that were rendered by other clinicians. 

In a follow-up report, auditors found DOH officials made some progress implementing the recommendations made in the initial audit report. Those efforts included certain steps to recover $116,298 in overpayments. However, at the time auditors completed follow-up fieldwork, none of the overpayments were actually recovered and additional actions were still needed.

 

Department of Motor Vehicles (DMV): Traffic Ticket Surcharges (Follow-Up) (2016-F-12)
An initial audit report issued in August 2015 concluded that, on an overall basis, the DMV consistently accounted for and reported all traffic ticket surcharge revenue. However, auditors identified certain areas where the DMV could make greater use of the data it maintains to better manage and improve its operations. In a follow-up report, auditors found DMV officials have made progress in implementing the recommendations identified in the initial report. However, additional improvements are still needed.

 

For access to state and local government spending and more than 50,000 state contracts, visit www.openbooknewyork.com. The easy-to-use website was created by DiNapoli to promote openness in government and provide taxpayers with better access to the financial workings of government.

New York State Department of Civil Service - Policy Bulletin #16-01

New York State Department of Civil Service - Policy Bulletin #16-01

Separations and Leaves

N.B. The Rules of the New York State Civil Service Commission and the Regulations of the President of the Civil Service Commission, except as otherwise specified in any particular rule, apply to positions and employments in the classified service of the State of New York as the employer and positions and employments in the classified service of public authorities, public benefit corporations and other agencies for which the Civil Service Law is administered by the State Department of Civil Service. Many local civil service commissions and county personnel officers have adopted similar provisions addressing separations and leaves of employees in the classified service of such jurisdictions.

Leaves of Absence Without Pay

THIS POLICY BULLETIN REPLACES POLICY BULLETIN #98-02, issued December 29, 1998.

This policy bulletin is intended to be a guide to agencies on the topic of leaves of absence without pay.

Leaves of Absence Generally

The purpose of any leave of absence without pay is to provide employees with their appropriate tenure protection, promotion rights, and layoff rights based upon the employee's status in that position. Employees may not have multiple simultaneous leaves from the same item/position. However, to completely preserve their rights, employees may be on leave from different positions in the same title, in the same or different jurisdictional classes.

Some types of leaves are termed "mandatory." Other leaves are termed "discretionary."

Mandatory leaves must be granted as required by Civil Service Law or rule or negotiated agreement, or Federal law, or State policy.

Discretionary leaves may be granted in accordance with the provisions set out in 4 NYCRR 5.2.

Usually a mandatory leave is granted when a permanent employee:

1. Is promoted or transferred to a position in which the employee must serve a probationary period:

   (a) In the competitive class is appointed in contingent permanent, temporary or provisional status to a position in the employee's agency.

   (b) In the non-competitive or labor class is appointed in contingent permanent status to a position in the employee's agency.

2. Is absent for a reason specified in the Family & Medical Leave Act.

3. Is absent for reasons specified in the Military Law. [An employee ordered to military service may be entitled to Military Leave with Pay for limited periods.] 

4, Is unable to perform the duties of the employee's position due to disability. [See Civil Service  Law §71, Workers' Compensation Leave and Civil Service Law §§72 and 73, Leave for ordinary disability. Such leaves are without pay although the employee may use accrued leave credits in order to remain of the payroll until such leave credits are exhausted.]

When an employee must be granted a leave in a situation governed both by a Civil Service Law, or rule and a negotiated agreement, and the identified limitations or length of leave required are different, the employee must be given the leave terms which provide the employee with the most protection,

[N.B. 4 NYCRR 26.3, "Rules applicable to employees in negotiating units," provides that "The provisions of these attendance rules, insofar as they apply to employees in the negotiating units established pursuant to Article 14 of the Civil Service Law [the Taylor Law], shall be continued; provided, however, that during periods of time when there is in effect an agreement between the State and an employee organization reached pursuant to the provisions of said Article 14, the provisions of such agreement and the provisions of such rules shall both be applicable. In the event the provisions of the agreement are different from the provisions of the attendance rules, the provisions of the agreement shall be controlling"(emphasis supplied). 4 NYCRR 29.1 and 29.2 address Leaves Without Pay for officers and employees designated Managerial or Confidential within the meaning of the Taylor Law and, presumably, officers and employees not so designated and not in a collective bargaining unit for the purposes of the Taylor Law. See  Attendance for Managerial/Confidential Employees in New York State Departments and Institutions.] 

Usually a discretionary leave is granted when a permanent employee who is not eligible for a mandatory leave:

1. Requests a leave because the employee accepted an appointment to a position in a different jurisdictional class.

2. Requests a leave because the employee accepted an appointment in another agency in temporary or provisional status.

3. Requests a leave for educational, parenting, or other personal reasons.

Basic Principles of Discretionary Leaves

A leave is discretionary if it is not mandatory.

4 NYCRR 5.2 permits an appointing authority to grant a discretionary leave for two years. At the end of this initial two years permission to extend such leave must be granted by the Civil Service Commission.

In some cases the courts have viewed a discretionary leave as being essentially a "contract" between an employee and his/her appointing authority. For the specified period the employee is entitled to be absent and, at the end of that period, to return. The terms of these contracts may only be changed by mutual consent, with the exception that employees on discretionary leave to serve in another position in the State service must be restored upon request.

A leave of absence does not prohibit the agency from dealing with the position in the normal course of business, e.g., filling the position, abolishing the position or assigning the position to a different location.

Employees may not be on mandatory leave and discretionary leave simultaneously from the same position.

Where an extension or further extension is not granted, the employee must return to the former position (i.e., title and status) and serve for six months before the agency may grant them a "new" discretionary leave, which does not require Commission approval.

Rights to Return to a “Hold Item”

Although for the sake of record-keeping a position (called a "hold item") is always identified, and usually the employee returns to it, management's right to assign and reassign staff among available positions overrides any right to a specific position, or even a location. The employee has the right to return to a position in their former title, jurisdictional class and appointment status.

When restoration to a hold occurs the agency designates the specific position. Agencies may change designated hold items and may reassign hold items to different locations at any time. However, some negotiated agreements may provide rights and limitations when employees return (for example see CSEA, I.S.U. Article 12). Further, agencies may not arbitrarily or capriciously reassign employees, nor do so punitively.

An employee who refuses to return to a hold item which was moved to a different geographic location (i.e., different county) is considered to have declined a reassignment, and is eligible for reemployment list status, but the employee is not eligible for bumping or retreat.

An employee granted a mandatory leave while serving probation may request restoration to a hold item prior to end of the leave, and the agency must restore the employee. This right to return is only provided under rule and contract to an employee granted mandatory leave while serving probation (4 NYCRR 4.5).

An employee who has been temporarily or provisionally appointed to another competitive class position, within the same agency, must be restored upon request (4 NYCRR 4.10).

A contingent permanent employee who is affected by the return of a prior permanent incumbent must be offered restoration with permanent status to the hold item required for this purpose by 4 NYCRR  4.11 and 4 NYCRR 4.12 provided the employee was originally appointed to the hold item in permanent status. If however, the employee was originally appointed to the hold item in contingent permanent status, and the agency made subsequent contingent permanent appointments to the same position, a comparison of the seniority dates (seniority dates are determined in accord with §80, or §80-a of the Civil Service Law) of all the contingent permanent appointees is required. Only if the returning former contingent permanent employee is the most senior may the employee return. If the one prior permanent incumbent has already returned, the contingent permanent employee may not return, regardless of seniority.

A contingent permanent employee who has completed probation may not voluntarily return to a hold item in the absence of a return of incumbent. Complete policy information regarding contingent permanent appointments and leaves can be found at SPMM 1810.

Appointments to Positions in the Non-competitive Class

A non-competitive phi designation on an employee's current position or the position to which the employee is appointed has no effect on the leave policies herein. See Advisory Memorandum #02-03 for more information.

Non-competitive class employees appointed pursuant to Civil Service Law §55-b/c must be given a leave when appointed to ANY OTHER §55-b/c position. See Advisory Memorandum #02-03 and Policy Bulletin #11-01 for more information.

Appointments to Positions in the Exempt Class

Exempt class employees may be granted a discretionary leave of absence. However, the employee should be informed that the leave does not give the employee the right to return or to hold the position for any period of time. The exempt class employee continues to serve at will, albeit while on leave.

Pending Commission Review

Newly classified positions are competitive class positions until the Commission and Governor act to place them in another jurisdictional class (with the exception of titles the Commission has designated that "all" positions in the title are in a particular jurisdictional class, and, therefore a newly classified position is immediately placed in that jurisdictional class). After the Commission acts, the position is considered "pending non-competitive," "pending exempt," or "pending labor" as a shorthand way of keeping track of the status. But, in fact, the jurisdictional class does not change from competitive until the entire administrative process is complete and the resolution is filed with the Department of State. Therefore, a permanent competitive class employee appointed to such a pending position, or an incumbent whose position has been reclassified to a pending position, should be considered as having received an appointment to a competitive class position for the purposes of leave rights under the provisions of 4 NYCRR 10.

When an exempt class position becomes vacant it is reviewed by the Commission. During the review period, only appointments in temporary status are permitted. A permanent competitive class or non-competitive class employee appointed on a temporary basis to such a position is not covered by 4 NYCRR 4.10 or negotiated agreements and therefore any leave granted must be discretionary.

Summary of Mandatory Leaves of Absence by Type of Appointment

Depending upon the type of appointment that a permanent employee receives, various negotiated agreements and the Civil Service rules may require a leave of absence be provided from the current position. The following tables summarize this department's interpretations of the various rules, laws and negotiated agreements which mandate a leave of absence be provided when certain appointments occur. The compilation of the tables is intended to provide a complete catalog of the conditions under which mandatory leaves are provided. It is recognized that there is an overlap between the various authorities under which leaves are mandated. Where such overlaps occur, the leave which provides the greatest benefit to the employee, either in terms of duration or limitations, should be applied.

The rules refer to specific sections of the Classified Service Rules. The negotiated agreements can be found on the GOER website at  https://www.goer.ny.gov/Labor_Relations/Contracts/.

Promotion is defined as:

The appointment of a permanent competitive, non-competitive or labor class employee to a competitive class position via appointment from a promotion or transition list; OR

The appointment of a permanent non-competitive or labor class employee to a higher grade position in the same jurisdictional classification.

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The Department of Civil Service may update the tables on the online version of this Memorandum to reflect changes resulting from future negotiations or reinterpretation. When updated, the previous tables will be chronicled in the Staffing Division policy files.

The online version of this Policy Bulletin, including the tables, is posted on the Internet at: 
https://www.cs.ny.gov/ssd/Manuals/SPMM/2200SeparationsLeaves/Policy%20Bulletin%2016-01.htm

A school district’s decision to abolish a position and have a BOCES assume performing the duties of the abolished position constitutes a “transfer of a function” within the meaning of Civil Service Law §70(2).

A school district’s decision to abolish a position in the classified service and have a BOCES assume performing  the duties of the abolished position constitutes a “transfer of a function” within the meaning of Civil Service Law §70(2).

However, said the Appellate Division, petitioner’s “data management services” job duties in the position abolished by the school district were assumed by existing staff members of BOCES. Thus, said the court, petitioner failed to establish a clear right to the relief sought because she was not a "necessary employee" within the meaning of §70.2.

The court noted §70(2) provides, in relevant part that "Upon the transfer of a function . . . from one department or agency of the state to another department or agency of the state, . . . provision shall be made for the transfer of necessary officers and employees who are substantially engaged in the performance of the function to be transferred."Accordingly, said the Appellate Division, "[a]n employee is eligible for a a transfer pursuant to Civil Service Law §70(2) only if he or she is a 'necessary ... employee' - i.e., if the agency or the department to which his or her duties are being transferred does not have sufficient staff at the time of the transfer to perform the duties being transferred.

N.B. Had the "transfer of function" involved duties performed by an employee in the unclassified service, the provisions of Education Law §3014-a would control. §3014-a addresses the rights of educators in the event a BOCES takes over a program formerly operated by a school district or by a county vocational education and extension board.

Decision cited as 2016 NY Slip Op 08139, Appellate Division, Third Department