Procedures to be followed by school boards seeking to contract for expert consultant services

Procedures to be followed by school boards seeking to contract for expert consultant services

Decisions of the Commissioner of Education, Decision No. 17,188

Among the several issues certain residents and taxpayers of the district [Applicants] raised in an appeal to the Commissioner of Education were challenges to the board’s adoption of a resolution provided for contracting with a consultant, Barbara J. Smith, on the recommendation of the district’s audit committee to serve as its external auditor to assist the district in coming into compliance with applicable State requirements by implementing proper budgetary development and monitoring procedures.* 

The Applicants contended that:

[1] The audit committee violated Education Law §2116-c by recommending the hiring of a consultant;

[2] Certain members of the school board had acted in violation of Education Law §1613 in soliciting and engaging a consultant without seeking competitive bids;

[3] The vote of certain board members approving a resolution to “suspend the District policy that requires the Superintendent’s recommendation for the [school board] to hire a consultant” justifies their removal from office and

[4] The school board's hiring of the consultant encroached upon the exclusive authority of the superintendent, in violation of Education Law §1711.

Addressing the contract issue raised in this appeal concerning the board's not seeking "competitive bid" for the consulting services required, the Commissioner observed that the board sought to obtain the professional skills and knowledge of a consultant**to provide training, assistance, and mentoring to the district’s business official relating to the budget development, fiscal monitoring, and reporting. 

As the contract to retain the consultant to provided such types of professional services, the Commissioner said that it was not subject to "the sealed competitive bidding requirements of General Municipal Law §103." Consequently, the Commissioner explained, entering into a contract for professional services without competitive bidding does not violate Education Law §1619. As "professional services contracts" are outside the scope of competitive bidding, the Commissioner said that they "need not be awarded to the lowest bidder provided that the award is in the best interest of the taxpayers."

The Commissioner noted that General Municipal Law §104-b requires a board to adopt policies and procedures to govern the procurement of goods and services not subject to competitive bidding and further such procedures must contain, among other things, a requirement that proposals “be secured by use of written requests for proposals, written quotations, verbal quotations, or any other method of procurement which furthers the purposes of the section.” In this instance Board Policy 6741 set out the process for securing professional services, including the preparation of a request for proposals [REP].

Turning to the Applicants' complaint that certain board members had violated Policy 6741 as the basis for their removal from office, the Commissioner said that "it is well settled that, even if proven, violation of a board’s bylaws or policies, by itself, is not a sufficient basis for removal of a member of a board of education in a proceeding pursuant to Education Law §306."

In contrast, the Commissioner noted that "a violation of board policy may be used as evidence of willfulness of such conduct" and school district officers can only be removed under §306 when they engage in a "willful violation or neglect of duty," i.e.,"a purpose or intent to disregard a lawful duty or to violate a legal requirement" while "[m]ere negligence on the part of a school officer is not enough to warrant removal."

In this instance the Commissioner found that the acts about which Applicants complain "do not rise to the level of willful misconduct and, thus, on the record before me, [Applicants] have failed to demonstrate that [the board members named by Applicants] engaged in a willful violation or neglect of duty.” 

While noting that the board may not have processed the employment of the Consultant as may have been otherwise required by its policies, the Commissioner found that the process followed by the board in this regard "substantially furthered the purpose of General Municipal Law §104-b."

Finally, the Commissioner concluded that no evidence in the record supported a finding that the board members Applicants sought to have removed from office willfully violated the law or neglected their duty, the standard that must be met for removing a board member from office.

The Commissioner concluded her decision with the following statement: "Although I am constrained to deny this application for removal and dismiss this appeal, I admonish respondent board to fully comply with the procedures established in all applicable board policies in the future."

* Applicants had sought "interim relief ... to restrain the board from enforcing the resolution passed by the board to hire the Consultant, which request was denied by the Commissioner.

** The consultant selected by the board was a former audit manager with an accounting firm and former Chief Financial and Operating Officer for the City School District of the City of Buffalo,

The decision is posted on the Internet at:

http://www.counsel.nysed.gov/Decisions/volume57/d17188

Determining the amount of the General Municipal Law §207-a (2) supplement payable to a firefighter upon his or her retirement for disability because of a work related injury or disease

 
Determining the amount of the General Municipal Law §207-a (2) supplement payable to a firefighter upon his or her retirement for disability because of  a work related injury or disease
Fennelly v Eastchester Fire Dist., 2017 NY Slip Op 06533, Appellate Division, Second Department

General Municipal Law §207-a(1), in pertinent part, provides that a paid firefighter of an organized fire company or fire department of a city of less than one million population, or town, village or fire district, "who is injured in the performance of his duties or who is taken sick as a result of the performance of his duties so as to necessitate medical or other lawful remedial treatment, shall be paid by the municipality or fire district by which he is employed the full amount of his regular salary or wages until his disability arising therefrom has ceased." In effect, the firefighter is placed on sick leave at full pay until he or she returns to full duty or "light duty" with his or her employer, retires, dies, is found ineligible to continue to receive such compensation or retires.

General Municipal Law §207-a (2) provides, in pertinent part, for discontinuing the payment of the full amount of regular salary or wages with respect to any firefighter continued on the payroll pursuant §207-a(1) who is permanently disabled as a result of an injury or sickness incurred or resulting from the performance of his or her duties "in the event the firefighter is granted an accidental disability retirement allowance pursuant to section three hundred sixty-three of the retirement and social security law, a retirement for disability incurred in performance of duty allowance pursuant to section three hundred sixty-three-c of the retirement and social security law or similar accidental disability pension provided by the pension fund of which he is a member...."

§207-a(2), however, then mandates that the firefighter so retired "shall continue to receive from the municipality or fire district by which he [or she] is employed, until such time as he [or she] shall have attained the mandatory service retirement age applicable to him [or her] or shall have attained the age or performed the period of service specified by applicable law for the termination of his [or her] service, the difference between the amounts received under such allowance or pension and the amount of his [or her] regular salary or wages."*

In this CPLR Article 78 action the Appellate Division was asked to review a determination by the Board of Fire Commissioners of the Eastchester Fire District [Eastchester] that reflected the findings and recommendations "of a hearing officer, made after a hearing," that the petitioner, Keith E. Fennelly, Eastchester's retired former fire chief, "was not entitled to supplemental wage increases pursuant to General Municipal Law §207-a(2) and that Eastchester was entitled to recoup 'overpayments' made to [Fennelly] since 2005."

The court held that [1] Fennelly was not entitled to the supplemental wage increases, i.e. payments reflecting "the difference between the amount received under such allowance or pension and the amount of his [or her] regular salary or wages"* but [2] Eastchester was not  entitled to recoup any "overpayments" it made to Fennelly since 2005. The court "otherwise dismissed" Fennelly's petition "on the merits."

The court explained that Eastchester's determination that Fennelly was not entitled to increases in the supplemental benefits he was paid pursuant to General Municipal Law §207-a(2) based upon the salary increases given to Eastchester's current fire chief was supported by substantial evidence. The evidence, said the court, "demonstrated that the salary paid to each fire chief is determined by the Board, and is based on the particular experience, education, and performance of the fire chief, as opposed to firefighters who receive salary increases pursuant to a collective bargaining agreement."

As to Eastchester recouping "past overpayments" from Fennelly, the Appellate Division, citing Matter of Masullo v City of Mount Vernon, 141 AD3d 95, said that "[t]here is no evidence that [Eastchester] had a process or application procedure in place at the time [Fennelly] was paid the section 207-a(2) benefits and, therefore, there can be no finding that the prior payments were improper so as to justify recoupment."

Note: NYPPL, after reviewing this decision, is of the opinion that although Fennelly may not be entitled to increases in the supplemental benefit  pursuant to General Municipal Law §207-a(2) in the amount of "the salary increases given to [Eastchester's] current fire chief," to the extent Fennelly's does not receive adjustments in the nature of a supplement to his retirement allowance or pension consistent with the reasons**and procedures described below, Eastchester is not in compliance with the mandates set out in §207-a(2) with respect to the payment of the "difference between the amounts received under such allowance or pension and the amount of his [or her] regular salary or wages:"

1. In Pease v Colucci, 59 A.D.2d 233, the court said that "Section 207-a of the General Municipal Law is a remedial statute enacted for the benefit of [firefighters] and should be liberally construed in their favor."

2. §207-a(1) provides that a firefighter suffering an injury or disease in the line of duty is to remain on the employer's payroll and receive "his [or her] compensation as long as he [or she] has not recovered from his [or her] injury," even if he or she remains unable to return to duty, in whole or in part, as a result of such injury or disease for the rest of his or her life. Such compensation must include any subsequent raises in salary given to those in the same grade or title held by the injured firefighter at the time of his or her injury.

3. In the event the firefighter retires, or is retired pursuant to an application filed on his or her behalf  by his or her employer as authorized by §207-a(2) and, as a result, is removed from the employer's payroll, §207-a(2) mandates that the retired firefighter's employer pay him or her the difference between the amount he or she receives as a retirement allowance or pension and the amount of his or her regular salary or wages he or she would have received had he or she remained on the employer's payroll and not retired. Such payments by the employer,  periodically adjusted to reflect any increases in salary or compensation paid to those in the same grade or title held by the injured firefighter at the time of his or her injury, are to be paid to the retired firefighter until he or she has attained the controlling mandatory age of retirement, dies or is found to be ineligible to receive his or her retirement allowance or pension.

In consideration of points [1], [2] and [3] above, and in view of Fennelly's particular situation with respect to the determination of the annual salary to be paid a fire chief upon his or her initial appointment by Eastchester following Fennelly's retirement for disability:

     [a] The amount of Fennelly's §207-a(2) mandated supplement to be paid by Eastchester initially should be determined based on the difference between his retirement allowance or pension and his annual salary immediately prior to the effective date of his retirement and any subsequent §207-a(2) payments reflecting the difference between the amounts received under such allowance or pension and the amount of his regular salary or wages should be determined so as to increase Eastchester's payments to supplement Fennelly's retirement allowance or pension that would provide

     [b] an equivalent to the percentage increase of any subsequent increase or increases in the annual salary paid to a successor incumbent fire chief following his or her initial appointment to the position based on Eastchester's representation that each such successor's annual salary at the time of his or her initial appointment "is based on the particular experience, education and performance of the appointee;" and

     [c] such supplement and adjustments to such supplements are to be paid by Eastchester to Fennelly until Fennelly attains the "mandatory age of retirement" set by the relevant provision of the Retirement and Social Security Law or his retirement allowance or pension ceases to be paid to him, whichever event first occurs.

* General Municipal Law §207-c(2), which applies to law enforcement personnel, tracks the provisions of §207-a(2) except that it does not provide for the employer's supplementing the individual's retirement allowance or pension in an amount equal to the "difference between the amounts received under such allowance or pension and the amount of his [or her] regular salary or wages."

** There are additional reasons and case law supporting NYPPL's views in this regard that have not been included in this "Note".

The decision is posted on the Internet at:
http://www.nycourts.gov/reporter/3dseries/2017/2017_06533.htm

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New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending September 23, 2017

New York State Comptroller Thomas P. DiNapoli announced the following audits and reports were issued during the week ending September 23, 2017 
Source: Office of the State Comptroller

Click on text highlighted in color  to access the full report

Audit of State Agencies Recommends Better Tracking of Food Purchases from Local Farmers
The Department of Agriculture and Markets and the Office of General Services are now directing all state agencies to submit better reporting of their purchases of New York produced foods according to an auditby State Comptroller Thomas P. DiNapoli found numerous problems. 

 Former Treasurer Arrested in Village of Millport Theft
Former Village of Millport Treasurer Dawn Haverley was arrested for felony grand larceny after an investigation and audit found she allegedly stole more than $4,000 in public funds.


New York State Comptroller Thomas P. DiNapoli announced his office completed audits of the 

Town of Carlisle – Fund Balance (Schoharie County)
The board has not developed a fund balance policy or comprehensive long-term financial and capital plans specifying the town"s objectives and goals for using accumulated funds. General fund balance totaled $623,000 at the end of 2016, more than 950 percent of the tax levy and approximately three times actual expenditures that year. 

Keeseville Volunteer Fire Department – Financial Operations (Clinton County)
Department officials did not deposit or account for all donations received or deposit money received from fundraisers and lounge sales. Deposits totaling approximately $158,300 were not supported by adequate documentation. Department officials did not approve 499 disbursements totaling $63,010 before payment was made. 

City of Niagara Falls – Financial Condition (Niagara County)
The city did not maintain a multiyear financial plan and has continued to rely on unreliable revenues and one-time funding sources. From fiscal years 2014 through 2017, city officials balanced the budget using primarily casino revenue, averaging $9 million, and fund balance, averaging $2.9 million. By the end of 2017, auditors project that the city will deplete available fund balance. Assuming no additional casino revenue is received, the city will have a projected general fund budget gap of $12 million for 2019.

Village of Sagaponack – Claims Processing (Suffolk County)
The board did not perform an effective claims audit or establish an adequate process to ensure that transactions were properly authorized and approved, complied with statutory or village requirements or that claims were for proper village purposes. As a result, the board does not have adequate assurance that goods and services are purchased at the best price.

Determining a claimant's exclusion with respect to his or her eligibility for unemployment insurance benefits pursuant to Labor Law §565(2)(d)

Determining a claimant's exclusion with respect to his or her eligibility for unemployment insurance benefits pursuant to Labor Law §565(2)(d) 
Matter of Clemons (Village of Freeport--Commissioner of Labor), 2017 NY Slip Op 04333, Appellate Division, Third Department

Labor Law §565[2], in pertinent part, provides for certain exclusions from eligibility for unemployment insurance benefits. In addition to services not included pursuant to the provisions of §511 the Labor Law, the term "employment" does not include services rendered for a governmental entity by a person serving on a temporary basis in case of fire, storm, snow, earthquake, flood or similar emergency.

The Village of Freeport, Nassau County, [Village] sustained extensive damage as a result of Hurricane Sandy and was declared a major disaster by federal, state and local governments and ultimately received federal funding to assist it with its clean-up and restoration efforts. Village hired two individuals [Claimants] as temporary laborers to help with these clean-up and restoration efforts.

Following the end of their employment by the Village, Claimants filed applications for unemployment insurance benefits, and, over Freeport's objection, the Department of Labor issued initial determinations finding that the wages paid to Claimants were not excluded under Labor Law §565(2)(d) and thus Claimants were entitled to receive unemployment insurance benefits. Ultimately the Unemployment Insurance Appeal Board sustained the Department's determinations and Freeport appealed.

Freeport challenged the Unemployment Insurance Appeal Board ruling that the two Claimants were eligible to receive unemployment insurance benefits because they were not employees of Freeport within the meaning of Labor Law §565(2)(d). Freeport, on the other hand, argued that Claimants fell within the ambit of this statutory exclusion and thus were ineligible for unemployment insurance benefits.

The Appellate Division affirmed the Board's determination, explaining that for the  purposes of determining a claimant's exclusion with respect to his or her eligibility for unemployment insurance benefits pursuant to Labor Law §565(2)(d), "Whether this exclusion applies presents a mixed question of law and fact, and the Board's determination in this regard will be upheld if it has a rational basis"

It was not disputed that Claimants were hired on a temporary basis because of the damage caused by the hurricane. The court said that "the controverted issue is whether the cited exclusion applies and, more specifically, whether the services provided by . [an] emergency."

Claimants had been hired on a temporary basis using federal grant money received as a result of the damage caused by the hurricane. However, they both, performed routine maintenance duties, including cutting grass, raking leaves, shoveling snow, driving trucks and cleaning municipal parking lots. In determining that the services performed by Claimants were related to the hurricane clean-up efforts but "not performed in case of an emergency," the Board also noted that the Claimants were hired almost a year after the hurricane and at a time when "there was no need for immediate action."

The Board, said the Appellate Division, also relied upon a Program Letter issued by the United States Department of Labor [DOL] that provided the DOL's interpretation of the exclusion from unemployment insurance coverage of governmental services performed in case of emergency. Letter No. 22-97 stated that "the urgent distress caused by the emergency . . . must directly cause the need for the services to be performed" and that, if the services performed occur "after the need for immediate action has passed, they are not necessarily performed in case of emergency.

As Claimants were employed by Freeport  nearly a year after the hurricane, the court found that there was a rational basis for the Board's decision that the exclusion did not apply and that the services performed by Claimants "were in covered employment" and thus they were eligible for unemployment insurance benefits.

Accordingly, the Appellate Division said that it found "no reason to disturb the decisions of the Board" regarding Claimants.

The decision is posted on the Internet at: 
http://www.nycourts.gov/reporter/3dseries/2017/2017_04333.htm

Disciplinary action follows employee's disrespectful and intimidating behavior towards superiors

Disciplinary action follows employee's disrespectful and intimidating behavior towards superiors

OATH Index No. 2307/17

A New York City job opportunity specialist [Specialist] was served with disciplinary charges pursuant to Civil Service Law §75 for allegedly having engaged in disrespectful and intimidating behavior directed towards her superiors.

The Office of Administrative Trials and Hearings Administrative Law Judge Ingrid M. Addison found that on one occasion the Specialist had "loudly confronted the director of her work location to complain about her supervisor," using inappropriate and offensive language. The Specialist also refused to leave the director’s office after she was instructed to do so.

The ALJ found that on another occasion the Specialist "snatched a document from, pointed her finger, and yelled at her supervisor."

In addition, Judge Addison found that the Specialist's employer established that the Specialist failed to follow her supervisor’s instructions on three occasions.  

Considering that the Specialist had had no prior discipline action taken against her, the ALJ said "This tribunal has generally applied the principles of progressive discipline, which aims to achieve employee behavior modification through increasing penalties for repeated or similar misconduct."

Noting that the employer sought to have the Specialist suspended without pay for 35 days, ALJ Addison said that she found such a penalty "excessive" and  recommended the Specialist be given a 20-day suspension without pay as the penalty for the Specialist's proven misconduct.

The decision is posted on the Internet at:

http://archive.citylaw.org/wp-content/uploads/sites/17/oath/17_cases/17-2307.pdf

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