New York State Governor Cuomo waives the statutory 15-day "waiting period" for a public employee's effective date of retirement

New York State Comptroller DiNapoli requested the Executive Order* in order to safeguard benefits for families who may lose a loved one to COVID-19 before their service retirement can be made official. The Executive Order applies to member of the New York State and Local Retirement System.

“Many government workers are on the front lines battling the coronavirus in their communities every day,” DiNapoli said. “God forbid something should happen to them before their retirement becomes effective. Waiving the waiting period after filing for service retirement benefits ensures their families will get the benefits that were intended for them. My thanks to Governor Cuomo for acting on my request and taking steps to protect our heroic state and local workers and their families in these tough times.”

Under the existing law, members of the New York State and Local Employees Retirement System (NYSLRS) must wait 15 days before their service retirement date is effective. This window exists to give the member time to change their mind about their retirement, since the decision is irrevocable. If members of the Employees Retirement System were to die before the period was over, however, their service retirement would not be effective and their beneficiary would lose the retirement benefits the member wanted to provide for them.

Executive Order 202.18 authorizes a retroactive waiver of the 15 day waiting period to March 7, 2020, the date that the state emergency was declared, for members who have died of a COVID-related illness. The EO will enable the many members who are eligible to retire and experience the sudden onset of COVID-19, to choose an effective date of retirement that is less than 15 days from the date of filing. Beneficiaries of Police and Fire members already have the ability to choose service retirement benefits if the member dies before retirement is effective.

NYSLRS recommends that members place an effective date of retirement on their application or if filing using Retirement Online. Alternatively, members using a paper application may indicate “ASAP” in the effective date field and their retirement will be effective on the day after the application is filed with NYSLRS.

DiNapoli wrote to Governor Cuomo last week to request the Executive Order, which rescinds the 15-day window for NYSLRS’ members applying for service retirement during the current state of emergency through May 16, 2020.

* Click on the text in color to link to the full text of the referenced item.

Workers' compensation benefit voided as a result of making a false statement or misrepresentation

Following establishing a claim for workers' compensation benefits by an employee [Claimant], which claim was subsequently amended twice to include other injuries, the self-insured employer [Employer] raised the issue of whether Claimant had violated Workers' Compensation Law §114-a by making a false statement or representation of a material fact for the purpose of obtaining workers' compensation benefits.

Following a hearing, a Workers' Compensation Law Administrative Law Judge [ALJ] found that Claimant violated §114-a and imposed a penalty of "a rescission of awards, as well as a disqualification of future awards." Claimant subsequently appealed a panel of the Workers' Compensation Board sustaining the ALJ's determination.

The Appellate Division upheld the Board's decision. Citing §114-a [1], the court explained that "A fact is considered material when it is significant or essential to the issue or matter at hand." Further, if supported by substantial evidence, the Appellate Division explained that the Board's determination that a person violated Workers' Compensation Law §114-a will not be disturbed.

In this instance the Board had found that Claimant violated §114-a by making a false statement of fact about her work activities and by failing to disclose critical information to an examining physician.*

Because substantial evidence supports the Board's determination that claimant violated Workers' Compensation Law §114-a, the Appellate Division held that "it will not be disturbed," and found Claimant's challenge to the imposed penalty to be without merit.

* The Appellate Division noted that its review of the record confirms the Board's finding that although Claimant testified that, since her classification with a permanent total disability, she had not worked in any capacity or run any businesses, in the subsequent disqualification hearing that Claimant stated that she had operated a photography business and took photographs for parties and family events.

The decision is posted on the Internet at:

http://www.nycourts.gov/reporter/3dseries/2020/2020_02209.htm

Standards of evidence required to support termination of employment decisions vary

Among the issues addressed by the U.S. Circuit Court of Appeals, Second Circuit, in this action was the standard of evidence that must be met to support the termination of a public employee in a disciplinary action. 

A §75 Disciplinary Hearing Officer found that “substantial evidence” supported several of the charges filed against the employee [Complainant] and recommended that he be demoted to a lower grade position. The then Assistant City Manager adopted the Hearing Officer’s findings of fact but decided to terminate rather than demote the Complainant.

The Complainant then filed an Article 78 petition in New York State Supreme Court seeking reinstatement to his former position and back pay contending that New York statutory law and the Due Process Clause of the Fourteenth Amendment both require that for-cause termination decisions be based upon a preponderance of the evidence and not substantial evidence.

In civil trials the preponderance standard is met when the party with the burden of proof, in this situation the charging party, convinces the hearing officer that the evidence it presented has a greater than 50% chance that it is true.

In contrast, substantial evidence is “more than a mere scintilla" of evidence. As the U.S. Supreme Court explained in Richardson v. Perales, 402 U.S. 389, substantial evidence is  such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.”*

Ultimately the Appellate Division rejected Complainant's challenge, concluding that “due process requires application of the preponderance of the evidence standard only when the penalty of dismissal is accompanied by some added stigma,” which the court found was not present in this case.**

After the Appellate Division issued its decision, the parties cross-moved for summary judgment on the due process claims. The federal district court granted summary judgment to the employer, concluding that Complainant was collaterally estopped from re-litigating his due process claims and that, in the alternative, he was afforded adequate process.

* For a comprehensive analysis see Standards of Appellate Review in the Federal Circuit: Substance and Semantics by Kevin Casey, Jade Camara and Nancy Wright, posted on the Internet at:  https://www.slideshare.net/umesh1989/standards-of-appellate-review-in-the-federal-circuit-substance-and-semantics-83pages.

** Marentette v. City of Canandaigua, 159 AD3d 1410.

The Circuit Court's decision is posted on the Internet at:

https://www.courtlistener.com/opinion/4723922/marentette-v-city-of-canandaigua/

Audits of certain State agencies, municipalities and school districts released by the New York State Comptroller during the week ending April 18, 2020

Click on the text highlighted in color to access the full report.

Office of General Services (OGS): Compliance With Executive Order 95 (Open Data) (2019-S-39)

EO 95, issued in March 2013, established an Open Data Website for the collection and public dissemination of publishable state data maintained by state entities. Auditors found OGS has taken steps to meet the requirements of EO 95; however, certain aspects of the order have not been fully addressed. There is limited assurance OGS has created a complete catalogue of the publishable data that it maintains or accompanying schedules for making that data public. OGS has not incorporated compliance with EO 95 into its core business functions. For instance, there are no processes to identify new high-value data sets to publish on Open Data and OGS has not consistently updated data already posted.

Department of State: Compliance With Executive Order 95 (Open Data) (2019-S-16)

EO 95, issued in March 2013, established an Open Data Website for the collection and public dissemination of publishable state data maintained by covered state entities. Auditors found the department has generally complied with the requirements of EO 95 and continues to identify new data sets to add to Open Data. However, the department did not identify the total population of publishable data that it maintains so there is limited assurance it provided a complete catalogue or accompanying schedules for making the data public, as required. 

Higher Education Services Corporation (HESC): Oversight of the STEM Incentive Program (Follow-Up) (2019-F-56)

An audit issued in November 2018, found that HESC had taken steps to implement the structure necessary to administer the Science, Technology, Engineering, and Mathematics (STEM) Incentive Program. However, auditors identified several areas for improvement. In a follow-up, auditors found HESC made progress in correcting the problems identified in the initial audit report.

Homes and Community Renewal (HCR): Low-Income Housing Fund Program (Follow-Up) (2019-F-44)

A report issued in August 2014 found that a significant number of Low-Income Housing Trust Fund Program projects were being delayed by at least six months due to, among other issues, questionable award decisions, lax monitoring or enforcement of expectations, and delays in key approvals. The initial audit also found that the program did not consistently adhere to its own policies regarding the project award process. In a follow-up, auditors found HCR officials made some progress in addressing the problems identified in the initial audit. 

Akron Fire Department – Financial Activities (Erie County)

Auditors determined that 101 credit card purchases totaling $22,100 did not have original receipts attached to the monthly statement. In July 2019, Richard A. Lobur, a fire department member, admitted to taking almost $40,000 in grant money to use for personal expenses, pay off credit card debt and make loan payments. He pleaded guilty to theft of government money and agreed to pay $39,182.92 in restitution. The matter was referred to the Erie County District Attorney’s Officer and resulted in the arrest of three other individuals. In December 2019, one individual pleaded guilty to petit larceny while the other two pleaded to a non-criminal disposition. All three were ordered to pay restitution.

Town of Carmel – Procurement (Putnam County)

The board-adopted procurement policy does not provide a clear method for procuring professional services. Auditors found the town procured professional services from 16 providers with payments totaling $870,909 without competitive methods. In addition, the town did not obtain the required number of quotes for 34 purchases totaling $59,426; a proposal for one purchase totaling $13,404 or competitively bid three purchases totaling $911,044.

Town of Caroline – Town Clerk and Credit Card Purchases (Tompkins County)

The town clerk did not deposit or remit all tax collections to the supervisor and county treasurer in a timely manner. In addition, the town clerk did not reconcile her bank account or identify errors such as duplicate tax payments received from taxpayers. Auditors found that the town clerk did not report or remit fees in a timely manner for 2018 and 2019. Auditors also determined that the board approved inappropriate or unsupported credit card charges totaling $5,759.

Town of Richford – Town Clerk/Tax Collector (Tioga County)

Real property taxes totaling $1,443,876 and clerk fees totaling $2,604 were not remitted to the supervisor or treasurer in a timely manner. Auditors found 45 real property tax receipts totaling $690,961 were deposited from two to 60 days after receipt instead of within 24 hours. In addition, there were five instances totaling $2,089 where clerk fees were not deposited within three days of when collections accumulated to more than $250.

Cuba-Rushford Central School District – Financial Management (Allegany County and Cattaraugus County)
The district’s financial reserve plan states that the district will reduce surplus fund balance as recommended by Comptroller DiNapoli’s previous report and the board’s fund balance policy states that it will strive to ensure that surplus fund balance does not exceed 4 percent. Surplus fund balance continued to consistently exceed the 4 percent limit by an annual average of 9 percentage points, or approximately $2 million. The board and district officials consistently overestimated appropriations and appropriated fund balance for planned operating deficits that never occurred.

Monticello Central School District – Fund Balance Management (Sullivan County)
The Board overestimated appropriations from 2016-17 through 2018-19, helping result in $12.1 million in appropriated fund balance not being used to finance operations. In addition, the district’s recalculated surplus fund balance exceeded the statutory limit each of the last three fiscal years by 12.3 to 16.3 percentage points. As of June 30, 2019, the District overfunded one reserve by $820,000.

South Colonie Central School District – Allocation of Personnel Costs (Albany County)
District officials accurately allocated personnel costs between district and state grant activities Auditors found total personnel costs of $745,262, of which $358,384 was funded using general fund money, were adequately supported and properly allocated. Except for minor discrepancies, which auditors discussed with district officials, teacher center personnel costs of $434,790 were supported, properly allocated and accurately reported as teacher center costs.

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