NYSIF Pays Inmates, Stiffs Amherst

$36K payment to convicts latest example of NYSIF mismanagement
May 11, 2012

Assemblyman Ray Walter (R,C,I-Amherst) recently wrote to Governor Andrew Cuomo seeking action against the New York State Insurance Fund (NYSIF), which has been spending money on convicted felons while continuing to withhold the millions owed to Amherst taxpayers. Recent audits show that NYSIF paid seven convicted felons roughly $36,000 in worker’s compensation benefits over the past three years. This money was spent as NYSIF continues to defy an order from the state Supreme Court requiring the fund to pay the town of Amherst over $23 million as part of a 10-year personal injury case.

“Apparently, NYSIF is more interested in giving handouts to felons than returning the money they owe to Amherst families,” said Walter. “The fact that NYSIF has authorized benefits for incarcerated criminals while refusing to comply with the state Supreme Court’s order to refund the town of Amherst $23.4 million is criminal in and of itself. At a time when new members of the Legislature are fighting to fix the way that business is done in Albany, this is truly an example of government at its worst.”

Walter has written to NYSIF Chief Executive Deputy Director Dennis Hayes and Oversight Committee Chairman Andrew Hevesi urging action on the money owed to Amherst.

The issue stems from a 2002 personal injury case in which an employee of a contractor sustained an injury while working on a building maintained by the town. In 2008, the town was ordered to pay $23.4 million to the claimant. The town complied with the court order, and after its insurance carrier picked up $10 million of the claim, it was forced to borrow to pay the remaining balance.

The town brought legal action against the contractor, McGonigle and Hilger Roofing, to recover the amount it paid out for the injury. Multiple court rulings granted the town’s claim against the contractor. The State Insurance Fund indemnified the owners of the company and is, therefore, ultimately liable.