Amd Ed L, generally; add Art 4-B SS57 - 59, Exec L; amd S33, Gen Muni L; add S742, amd S740, Lab L; add
S190.72, Pen L; amd S211, R & SS L
Enacts the NYS school taxpayers' protection act; requires the reporting of suspected corruption or conflicts of interest within the operation of a school district; requires the treasurer of each district to issue an annual report of all moneys received by the board and any expenditures; creates a compensation committee to oversee proposed contracts of all school district bargaining units, administrators and superintendents; creates the office of the state inspector general for education; prohibits retaliation by public school district employers where employees have made complaints of malfeasance.
STATE OF NEW YORK
________________________________________________________________________
7280
2009-2010 Regular Sessions
IN ASSEMBLY
March 27, 2009
___________
Introduced by M. of A. THIELE -- read once and referred to the Committee
on Education
AN ACT to amend the education law, the executive law, the general munic-
ipal law, the labor law, the penal law and the retirement and social
security law, in relation to enacting the "New York state school
taxpayers' protection act"
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. Short title. This act shall be known and may be cited as
2 the "New York state school taxpayers' protection act".
3 § 2. Legislative findings and intent. Public school districts in New
4 York state have recently experienced numerous instances of financial
5 scandals. These scandals have been unprecedented in both the number and
6 diversity of financial malfeasance. Furthermore, such scandals result in
7 the diversion of hard-earned property taxpayers' money from their proper
8 use in school instruction to improper and illegal purposes that do not
9 further the school districts' essential mission of educating New York
10 children. Therefore, the legislature finds that it is necessary to
11 establish a new, independent state agency charged with the function of
12 investigating allegations of corruption, financial improprieties, uneth-
13 ical conduct, misconduct or other criminal conduct within public school
14 districts outside of New York city. In addition, the legislature further
15 finds that the current laws must be amended to incorporate school
16 district financial safeguards and establish sanctions for violations of
17 school district finance laws.
18 § 3. The education law is amended by adding a new section 2116-d to
19 read as follows:
20 § 2116-d. Persons and officials required to report cases of suspected
21 corruption, other criminal activity or conflict of interest occurring
22 within the operations of a school district. 1. The following persons and
23 officials are required to report or cause a report to be made in accord-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD10119-01-9
A. 7280 2
1 ance with this section when they discover information concerning conduct
2 which is known or should reasonably be known to involve corruption or
3 other criminal activity or conflict of interest by either a public
4 school district employee that relates to their employment or by a
5 person, persons or entities doing business with a public school district
6 with respect to their transactions with the school district, any school
7 district officer, and any school district employee.
8 2. Any person or official mandated to report cases of suspected
9 corruption, other criminal activity or conflict of interest pursuant to
10 subdivision one of this section shall immediately report the information
11 they have to the New York state inspector general for education, as
12 established in article four-B of the executive law.
13 3. Any school district which employs persons mandated to report
14 suspected incidents of corruption, other criminal activity or conflict
15 of interest pursuant to subdivision one of this section shall provide
16 such current and new employees with written information explaining the
17 reporting requirements set out in subdivision one of this section.
18 4. Any person or official required by this section to report certain
19 information as specified in this section who willfully fails to do so
20 shall be guilty of a class A misdemeanor.
21 5. Any person or official required by this section to report certain
22 information as specified in this section who knowingly and willfully
23 fails to do so shall be civilly liable for the damages proximately
24 caused by such failure.
25 6. Any person or official participating in good faith in the making of
26 a report under this section shall have immunity from any liability,
27 civil or criminal, that might otherwise result by reason of such
28 actions. For the purpose of any proceeding, civil or criminal, the good
29 faith of any such person or official required to report under this
30 section shall be presumed, provided such person or official was acting
31 in discharge of their duties and within the scope of their employment,
32 and that such liability did not result from the willful misconduct or
33 gross negligence of such person or official.
34 § 4. Subdivision 6 of section 2122 of the education law is amended to
35 read as follows:
36 6. Such treasurer shall[, whenever required by such trustees,] report
37 to [them] such trustees a detailed [statement] annual report of the
38 moneys received by him and of his disbursements, and at the annual meet-
39 ing of such district he shall render a full account of all moneys
40 received by him and from what source, and when received, and all
41 disbursements made by him and to whom and the dates of such disburse-
42 ments respectively, and the balance of moneys remaining in his hands.
43 The treasurer shall certify in such annual report that he has: reviewed
44 the annual report; that based on the treasurer's knowledge, the report
45 does not contain any untrue statement of a material fact or omit to
46 state a material fact necessary in order to make the statements made, in
47 light of the circumstances under which such statements were made, not
48 misleading; and based on such treasurer's knowledge, the financial
49 statements, and other financial information included in the report,
50 fairly present in all material respects the financial condition and
51 results of operations of the school district as of, and for, the periods
52 presented in the report.
53 § 5. Section 1720 of the education law is amended by adding a new
54 subdivision 3 to read as follows:
55 3. The treasurer of the district shall issue an annual report with a
56 full and detailed account of all moneys received by the board or such
A. 7280 3
1 treasurer, for its account and use, and of all the moneys expended
2 therefore, giving the items of expenditure in full. The treasurer shall
3 certify in such annual report that he has: reviewed the annual report;
4 that based on the treasurer's knowledge, the report does not contain any
5 untrue statement of a material fact or omit to state a material fact
6 necessary in order to make the statements made, in light of the circum-
7 stances under which such statements were made, not misleading; and based
8 on such treasurer's knowledge, the financial statements, and other
9 financial information included in the report, fairly present in all
10 material respects the financial condition and results of operations of
11 the school district as of, and for, the periods presented in the report.
12 § 6. Section 2215 of the education law is amended by adding a new
13 subdivision 17 to read as follows:
14 17. To certify in the annual report issued pursuant to either section
15 seventeen hundred twenty of this chapter or section twenty-one hundred
16 twenty-two of this chapter that he has: reviewed the annual report; that
17 based on the superintendent's knowledge, the report does not contain any
18 untrue statement of a material fact or omit to state a material fact
19 necessary in order to make the statements made, in light of the circum-
20 stances under which such statements were made, not misleading; and based
21 on such superintendent's knowledge, the financial statements, and other
22 financial information included in the report, fairly present in all
23 material respects the financial condition and results of operations of
24 the school district as of, and for, the periods presented in the report.
25 § 7. The education law is amended by adding a new section 2116-e to
26 read as follows:
27 § 2116-e. Compensation committees. 1. Every school district, except
28 those employing fewer than eight teachers, shall establish by a resol-
29 ution of the trustees or board of education a local school district
30 compensation committee to oversee and report to the trustees or board on
31 the proposed contracts of all school district bargaining units, adminis-
32 trators and superintendents.
33 2. The compensation committee shall be established no later than Janu-
34 ary first, two thousand ten as a committee of the trustees or board, as
35 an advisory committee, or as a committee of the whole.
36 3. The compensation committee shall consist of at least three members,
37 at least two of whom shall not be a trustee or board member. The compen-
38 sation committee members shall serve without compensation. Employees of
39 the school district are prohibited from serving on the compensation
40 committee. A member of a compensation committee shall be deemed a school
41 district officer for the purposes of sections thirty-eight hundred elev-
42 en through thirty-eight hundred thirteen of this chapter, but shall not
43 be required to be a resident of the school district.
44 4. The role of a compensation committee shall be advisory and any
45 recommendations it provides to the trustees or board under subdivision
46 five of this section shall not substitute for any required review and
47 action by the trustees or board of education.
48 5. It shall be the responsibility of the compensation committee to:
49 (a) review every contract between the district and any bargaining
50 units, employees, administrators and superintendents negotiated after
51 January first, two thousand ten;
52 (b) receive and review proposed contracts between the district and any
53 bargaining units, employees, administrators and superintendents prior to
54 such contracts' approval; and
55 (c) provide recommendations to the trustees or board regarding the
56 salary, fringe benefits and other forms of compensation given and
A. 7280 4
1 proposed to be given to all school district employees, administrators
2 and superintendents.
3 6. Notwithstanding any provision of article seven of the public offi-
4 cers law or any other law to the contrary, a school district compen-
5 sation committee may conduct an executive session pursuant to section
6 one hundred five of the public officers law pertaining to any matter set
7 forth in paragraphs (a) and (b) of subdivision five of this section.
8 7. The commissioner is authorized to promulgate regulations with
9 respect to compensation committees as are necessary for the proper
10 performance of their duties.
11 8. As long as the chancellor of a school district in a city having a
12 population of one million or more inhabitants shall annually certify to
13 the commissioner that such district has a process for review by a
14 compensation committee of the district's contracts with any bargaining
15 units, employees, administrators and superintendents, the provisions of
16 this section shall not apply to such school district.
17 § 8. The education law is amended by adding a new section 2009-a to
18 read as follows:
19 § 2009-a. Additional requirements of notice prior to authorization of
20 school district employment contracts. Where any collective bargaining
21 agreement, employment contract or amendments to such agreement or
22 contract is to be submitted to a district meeting for a vote, the school
23 district board or trustees shall give notice, at least five weeks prior
24 to such meeting, through a district-wide mailing of the availability of
25 the agreement, contract or amendment at public libraries within the
26 district, at the school district offices and on the school district's
27 internet website, if one exists.
28 § 9. Subdivision 4 of section 1608 of the education law, as amended by
29 chapter 640 of the laws of 2008, is amended to read as follows:
30 4. Commencing with the proposed budget for the nineteen hundred nine-
31 ty-eight--ninety-nine school year, such proposed budget shall be
32 presented in three components: a program component, a capital component
33 and an administrative component which shall be separately delineated in
34 accordance with regulations of the commissioner after consultation with
35 local school district officials. The administrative component shall
36 include, but need not be limited to, office and central administrative
37 expenses, traveling expenses and all compensation, salaries and benefits
38 of all school administrators and supervisors, including business admin-
39 istrators, superintendents of schools and deputy, assistant, associate
40 or other superintendents under all existing employment contracts or
41 collective bargaining agreements, and teachers under existing employment
42 contracts, any and all expenditures associated with the operation of the
43 office of trustee or board of trustees, the office of the superintendent
44 of schools, general administration, the school business office, consult-
45 ing costs not directly related to direct student services and programs,
46 planning and all other administrative activities. The program component
47 shall include, but need not be limited to, all program expenditures of
48 the school district, including the salaries and benefits of teachers and
49 any school administrators or supervisors who spend a majority of their
50 time performing teaching duties, and all transportation operating
51 expenses. The capital component shall include, but need not be limited
52 to, all transportation capital, debt service, and lease expenditures;
53 costs resulting from judgments in tax certiorari proceedings or the
54 payment of awards from court judgments, administrative orders or settled
55 or compromised claims; and all facilities costs of the school district,
56 including facilities lease expenditures, the annual debt service and
A. 7280 5
1 total debt for all facilities financed by bonds and notes of the school
2 district, and the costs of construction, acquisition, reconstruction,
3 rehabilitation or improvement of school buildings, provided that such
4 budget shall include a rental, operations and maintenance section that
5 includes base rent costs, total rent costs, operation and maintenance
6 charges, cost per square foot for each facility leased by the school
7 district, and any and all expenditures associated with custodial sala-
8 ries and benefits, service contracts, supplies, utilities, and mainte-
9 nance and repairs of school facilities. For the purposes of the develop-
10 ment of a budget for the nineteen hundred ninety-eight--ninety-nine
11 school year, the trustee or board of trustees shall separate the
12 district's program, capital and administrative costs for the nineteen
13 hundred ninety-seven--ninety-eight school year in the manner as if the
14 budget for such year had been presented in three components.
15 § 10. Subdivision 4 of section 1716 of the education law, as amended
16 by chapter 640 of the laws of 2008, is amended to read as follows:
17 4. Commencing with the proposed budget for the nineteen hundred nine-
18 ty-eight--ninety-nine school year, such proposed budget shall be
19 presented in three components: a program component, a capital component
20 and an administrative component which shall be separately delineated in
21 accordance with regulations of the commissioner after consultation with
22 local school district officials. The administrative component shall
23 include, but need not be limited to, office and central administrative
24 expenses, traveling expenses and all compensation, salaries and benefits
25 of all school administrators and supervisors, including business admin-
26 istrators, superintendents of schools and deputy, assistant, associate
27 or other superintendents under all existing employment contracts or
28 collective bargaining agreements, and teachers under existing employment
29 contracts, any and all expenditures associated with the operation of the
30 board of education, the office of the superintendent of schools, general
31 administration, the school business office, consulting costs not direct-
32 ly related to direct student services and programs, planning and all
33 other administrative activities. The program component shall include,
34 but need not be limited to, all program expenditures of the school
35 district, including the salaries and benefits of teachers and any school
36 administrators or supervisors who spend a majority of their time
37 performing teaching duties, and all transportation operating expenses.
38 The capital component shall include, but need not be limited to, all
39 transportation capital, debt service, and lease expenditures; costs
40 resulting from judgments in tax certiorari proceedings or the payment of
41 awards from court judgments, administrative orders or settled or compro-
42 mised claims; and all facilities costs of the school district, including
43 facilities lease expenditures, the annual debt service and total debt
44 for all facilities financed by bonds and notes of the school district,
45 and the costs of construction, acquisition, reconstruction, rehabili-
46 tation or improvement of school buildings, provided that such budget
47 shall include a rental, operations and maintenance section that includes
48 base rent costs, total rent costs, operation and maintenance charges,
49 cost per square foot for each facility leased by the school district,
50 and any and all expenditures associated with custodial salaries and
51 benefits, service contracts, supplies, utilities, and maintenance and
52 repairs of school facilities. For the purposes of the development of a
53 budget for the nineteen hundred ninety-eight--ninety-nine school year,
54 the board of education shall separate the district's program, capital
55 and administrative costs for the nineteen hundred ninety-seven--ninety-
A. 7280 6
1 eight school year in the manner as if the budget for such year had been
2 presented in three components.
3 § 11. Subdivision 2 of section 1608 of the education law, as amended
4 by chapter 640 of the laws of 2008, is amended to read as follows:
5 2. Such statement shall be completed at least seven days before the
6 budget hearing at which it is to be presented and copies thereof shall
7 be prepared and made available[, upon request and] at the school
8 district offices, at any public library or free association library
9 within the district and on the school district's internet website, if
10 one exists, to residents within the district during the period of [four-
11 teen] thirty days immediately preceding the annual meeting and election
12 or special district meeting at which the budget vote will occur and at
13 such meeting or hearing. The board shall also as a part of the notice
14 required by section two thousand three of this chapter give notice of
15 the date, time and place of the budget hearing and that a copy of such
16 statement may be obtained by any resident in the district at each
17 schoolhouse in the district in which school is maintained during certain
18 designated hours on each day other than a Saturday, Sunday or holiday
19 during the [fourteen] thirty days immediately preceding such meeting.
20 The board shall include notice of the availability of such statement at
21 least once during the school year in any district-wide mailing distrib-
22 uted.
23 § 12. Subdivision 2 of section 1716 of the education law, as amended
24 by chapter 640 of the laws of 2008, is amended to read as follows:
25 2. Such statement shall be completed at least seven days before the
26 budget hearing at which it is to be presented and copies thereof shall
27 be prepared and made available[, upon request and] at the school
28 district offices, at any public library or free association library
29 within the district and on the school district's internet website, if
30 one exists, to residents within the district during the period of [four-
31 teen] thirty days immediately preceding the annual meeting and election
32 or special district meeting at which the budget vote will occur and at
33 such meeting or hearing. The board shall also as a part of the notice
34 required by section two thousand four of this chapter give notice of the
35 date, time and place of the budget hearing and that a copy of such
36 statement may be obtained by any resident in the district at each
37 schoolhouse in the district in which school is maintained during certain
38 designated hours on each day other than a Saturday, Sunday or holiday
39 during the [fourteen] thirty days immediately preceding such meeting.
40 The board shall include notice of the availability of such statement at
41 least once during the school year in any district-wide mailing distrib-
42 uted.
43 § 13. Paragraph (c) of subdivision 3 of section 2116-a of the educa-
44 tion law, as added by chapter 263 of the laws of 2005, is amended to
45 read as follows:
46 (c) Notwithstanding the provisions of subparagraph one of paragraph
47 (b) of subdivision four of section thirty-five of the general municipal
48 law, each school district shall (i) prepare a corrective action plan in
49 response to any findings contained in the annual external audit report
50 or management letter, or any final audit report issued by the state
51 comptroller, within ninety days of receipt of such report or letter, and
52 (ii) to the extent practicable, begin implementation of such corrective
53 action plan no later than the end of the next fiscal year. Each school
54 district shall notify the district residents of the availability of the
55 corrective action plan at public libraries within the district, at the
56 school district offices and on the school district's internet website,
A. 7280 7
1 if one exists. Any school district which fails to comply with the
2 required notification of availability of the corrective action plan
3 shall be subject to a civil penalty not to exceed five thousand dollars
4 upon an administrative determination by the commissioner.
5 § 14. The education law is amended by adding a new section 1527-a to
6 read as follows:
7 § 1527-a. Funding of mandates imposed on school districts. 1. Defi-
8 nitions. As used in this section, the following terms shall have the
9 following meanings unless the context shall otherwise require:
10 (a) "Mandate" shall mean:
11 (i) any state law, rule or regulation which creates a new program or
12 requires a higher level of service for an existing program which a
13 school district organized either by special laws or pursuant to the
14 provisions of a general law, is required to provide; or
15 (ii) any general law which grants a new property tax exemption or
16 increases an existing property tax exemption which any such school
17 district is required to provide.
18 (b) "Unfunded mandate" shall mean:
19 (i) any state law, rule or regulation which creates a new program or
20 requires a higher level of service for an existing program which any
21 such school district is required to provide and which results in a net
22 additional cost to such school district;
23 (ii) any alteration in funding provided to any such school district
24 for the purpose of defraying the costs of a program which it is required
25 to provide, thereby resulting in a net additional cost to such school
26 district; or
27 (iii) any general law which grants a new property tax exemption or
28 increases an existing property tax exemption which any such school
29 district is required to provide, thereby resulting in a net additional
30 cost to such school district.
31 (c) "Net additional cost" means the cost or costs incurred or antic-
32 ipated to be incurred within a one year period by a school district in
33 performing or administering a mandate after subtracting therefrom any
34 revenues received or receivable by the school district on account of the
35 mandated program or service, including but not limited to:
36 (i) fees charged to the recipients of the mandated program or service;
37 (ii) state or federal aid paid specifically or categorically in
38 connection with the program or service; and
39 (iii) an offsetting savings resulting from the diminution or elimi-
40 nation of any other program or service directly attributable to the
41 performance or administration of the mandated program.
42 2. Funding of school district mandates. Notwithstanding any other
43 provision of law, no unfunded mandate shall be enacted which creates an
44 annual net additional cost to any school district in excess of five
45 thousand dollars or an aggregate annual net additional cost to all
46 school districts in excess of five hundred thousand dollars.
47 3. Exemptions to the funding of school district mandates requirement.
48 (a) The state shall not be required to fund any new or expanded programs
49 for school districts if: (i) The mandate is required by a court order
50 or judgment; (ii) The mandate is provided at the option of the school
51 district under a law, regulation, rule, or order that is permissive
52 rather than mandatory; (iii) The mandate results from the passage of a
53 home rule message whereby a school district requests authority to
54 implement the program or service specified in the statute, and the
55 statute imposes costs only upon that school district which requests the
56 authority to impose the program or service; (iv) The mandate is required
A. 7280 8
1 by, or arises from, an executive order of the governor exercising his or
2 her emergency powers; or (v) The mandate is required by statute or exec-
3 utive order that implements a federal law or regulation and results from
4 costs mandated by the federal government to be borne at the local level,
5 unless the statute or executive order results in costs which exceed the
6 costs mandated by the federal government.
7 (b) Each act establishing a mandate shall provide that the effective
8 date of any such mandate imposed on school districts shall be consist-
9 ent with the needs of the state and school districts to plan implementa-
10 tion thereof, and also consistent with the availability of required
11 funds.
12 § 15. The executive law is amended by adding a new article 4-B to read
13 as follows:
14 ARTICLE 4-B
15 OFFICE OF THE STATE INSPECTOR GENERAL FOR EDUCATION
16 Section 57. Establishment and organization.
17 58. Functions and duties.
18 59. Powers.
19 § 57. Establishment and organization. 1. There is hereby established
20 the office of the state inspector general for education. The head of the
21 office shall be the education inspector general, who shall be appointed
22 by the board of the office of the state inspector general for educa-
23 tion. Such office shall be independent of the department of education
24 and of any other office, agency, board or commission of the state or any
25 of its political subdivisions.
26 2. The education inspector general may employ and at their pleasure
27 remove such personnel as they deem necessary for the performance of the
28 office, and may fix their compensation with amounts available therefor.
29 3. There is hereby established the board of the office of the state
30 inspector general for education which shall consist of eleven members,
31 and shall have and exercise the powers and duties of the office of the
32 state inspector general for education.
33 4. The board members shall be appointed as follows:
34 (a) three members shall be appointed by the governor, one of whom
35 shall be designated by the governor as the chair of the board;
36 (b) three members shall be appointed by the temporary president of the
37 senate;
38 (c) three members shall be appointed by the speaker of the assembly;
39 (d) one member shall be appointed by the minority leader of the assem-
40 bly; and
41 (e) one member shall be appointed by the minority leader of the
42 senate.
43 5. The board members shall serve for terms of five years.
44 6. The chair of the board or any five members thereof may call a meet-
45 ing of the board.
46 7. Any vacancy occurring on the board shall be filled within sixty
47 days of its occurrence, in the same manner as the member whose vacancy
48 is being filled was appointed. A person appointed to fill a vacancy
49 occurring other than by expiration of a term of office shall be
50 appointed for the unexpired term of the member he or she succeeds.
51 8. Six members of the board shall constitute a quorum and the board
52 shall have the power to act by majority vote of the total number of
53 members of the board without vacancy.
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1 9. The board members shall not receive compensation but shall be reim-
2 bursed for reasonable expenses incurred in the performance of their
3 official duties.
4 10. The board shall appoint an education inspector general who shall
5 perform the powers and duties set forth in sections fifty-eight and
6 fifty-nine of this article, and who shall serve for a term of five
7 years and may only be dismissed for cause or by a three-quarters vote of
8 the board. The board may fix the compensation of the education inspec-
9 tor general.
10 11. No board member, nor the education inspector general, shall hold
11 any elected public office or office in any political party, nor shall
12 any member be an employee of or under the supervision of any person who
13 holds such elected public office or office of a political party. No
14 member of the board shall serve in any public or political office with-
15 in five years of the member's period of service.
16 12. The education inspector general shall, prior to their appointment,
17 have had at least ten years experience in auditing or law enforcement or
18 investigation, or in prosecuting or aiding in the prosecution of fraud.
19 13. Members of the board shall, prior to their appointment, have had
20 at least three years experience in auditing or investigation of govern-
21 mental or school district operations, or in the practice of law, law
22 enforcement or in services related to development and management of
23 information technology or database creation and maintenance.
24 § 58. Functions and duties. The education inspector general shall
25 have the following duties and responsibilities:
26 1. to receive and investigate complaints from any source, or upon his
27 or her own initiative, concerning allegations of corruption, financial
28 improprieties, unethical conduct, misconduct or other criminal conduct
29 within public school districts outside of a city with a population of
30 one million or more;
31 2. to investigate and report on corruption and other criminal activ-
32 ity, school board election fraud, bidding irregularities and conflicts
33 of interest by public school district employees whose actions relate to
34 their employment, persons or entities doing business with a public
35 school district concerning their transactions with the school district,
36 and school board members whose actions relate to their office;
37 3. to determine with respect to such allegations whether disciplinary
38 action, civil or criminal prosecution, or further investigation by an
39 appropriate federal, state or local agency is warranted, and to assist
40 in such investigations;
41 4. to review and examine periodically the policies and procedures of
42 public school districts with regard to the prevention and detection of
43 corruption, financial improprieties, unethical conduct, misconduct,
44 other criminal conduct, school board election fraud, bidding irregulari-
45 ties and conflicts of interest or abuse;
46 5. to recommend remedial action to prevent or eliminate corruption,
47 financial improprieties, unethical conduct, misconduct, other criminal
48 conduct, school board election fraud, bidding irregularities, conflicts
49 of interest or abuse by public school district officials and employees;
50 6. to establish programs for training public school officials and
51 employees regarding the prevention and elimination of corruption, finan-
52 cial improprieties, unethical conduct, misconduct, other criminal
53 conduct, school board election fraud, bidding irregularities and
54 conflicts of interest or abuse;
55 7. to prepare an annual report that provides the results of the educa-
56 tion inspector general's findings with respect to all investigations
A. 7280 10
1 and detailed analysis of the current financial status of those school
2 districts that have been reviewed;
3 8. to include in such report any findings regarding the financial
4 practices of the school district that the education inspector general
5 believes violated, or could potentially violate, existing state rules
6 or regulations or may be of concern in that incompetence or lack of
7 training may result in financial practices that violate state rules and
8 regulations;
9 9. to issue the report to the legislature, the comptroller and the
10 department of education with each annual report posted on a public
11 internet website for at least five years from the date of issuance.
12 § 59. Powers. The education inspector general shall have the power
13 to:
14 1. subpoena and enforce the attendance of witnesses, including the
15 power to subpoena documents and records necessary to any investigation
16 from any public school district outside of a city with a population of
17 one million or more and from vendors who do business with such public
18 school districts;
19 2. administer oaths or affirmations and examine witnesses under oath;
20 3. require the production of any books and papers deemed relevant or
21 material to any investigation, examination or review;
22 4. notwithstanding any law to the contrary, examine and copy or remove
23 documents or records of any kind prepared, maintained or held by any
24 public school district covered by this article;
25 5. require any public school district employee to answer questions
26 concerning any matter related to the performance of his or her official
27 duties. No statement or other evidence derived therefrom may be used
28 against such officer or employee in any subsequent criminal prosecution
29 other than for perjury or contempt arising from such testimony. The
30 refusal of any officer or employee to answer questions shall be cause
31 for removal from office or employment or other appropriate penalty;
32 6. monitor the implementation by public school districts of any recom-
33 mendations made by the education inspector general;
34 7. perform any other functions that are necessary or appropriate to
35 fulfill the duties and responsibilities of the office.
36 § 16. Subparagraphs 2 and 3 of paragraph b of subdivision 2 of section
37 33 of the general municipal law, as added by chapter 267 of the laws of
38 2005, are amended and a new subparagraph 4 is added to read as follows:
39 (2) assessing the current financial practices of school districts,
40 BOCES and charter schools to ensure that they are consistent with estab-
41 lished standards, [and]
42 (3) determining that school districts, BOCES, and charter schools
43 provide for adequate protections against any fraud, theft, or profes-
44 sional misconduct[.], and
45 (4) auditing federal and state grant program expenditures in all
46 school districts, BOCES and charter schools.
47 § 17. Paragraph d of subdivision 2 of section 33 of the general munic-
48 ipal law, as added by chapter 267 of the laws of 2005, is amended to
49 read as follows:
50 d. The office of the state comptroller shall upon making a finding of
51 misconduct refer any findings of fraud, abuse or other conduct consti-
52 tuting a crime that are uncovered during the course of an audit, as
53 appropriate, to the commissioner of education, the New York state
54 inspector general for education, the charter entity, the attorney gener-
55 al, United States attorney or district attorney having jurisdiction for
A. 7280 11
1 appropriate action, together with any documents supporting the auditors'
2 findings.
3 § 18. The labor law is amended by adding a new section 742 to read as
4 follows:
5 § 742. Prohibition; public school district employer who penalizes
6 employees because of complaints of employer malfeasance. 1. Defi-
7 nitions. As used in this section, the following terms shall have the
8 following meanings:
9 (a) "Employee" means any person who performs services for and under
10 the control and direction of any public school district outside of a
11 city with a population of one million or more for wages or other remun-
12 eration.
13 (b) "Employer" means any public school district outside of a city with
14 a population of one million or more.
15 (c) "Agent" means any individual, partnership, association, corpo-
16 ration, or group of persons acting on behalf of an employer.
17 (d) "Public body" means:
18 (1) the United States Congress, any state legislature, or any elected
19 local governmental body, or any member or employee thereof;
20 (2) the New York state inspector general for education;
21 (3) the state comptroller;
22 (4) the attorney general;
23 (5) any federal, state or local regulatory, administrative or public
24 agency or authority, or instrumentality thereof;
25 (6) any federal, state or local law enforcement agency, prosecutorial
26 office, or police or peace officer;
27 (7) any federal, state or local department of an executive branch of
28 government; or
29 (8) any division, board, bureau, office, committee or commission of
30 any of the public bodies described in subparagraph one, two, three,
31 four, five, six or seven of this paragraph.
32 (e) "Retaliatory action" means the discharge, suspension, demotion,
33 penalization or discrimination against an employee, or other adverse
34 employment action taken against an employee in the terms and conditions
35 of employment.
36 (f) "Supervisor" means any person within an employer's organization
37 who has the authority to direct and control the work performance of an
38 employee, or who has the authority to take corrective action regarding
39 fraud, criminal activity or other malfeasance to which an employee
40 submits a complaint.
41 2. Retaliatory action prohibited. Notwithstanding any other provision
42 of law, no employer shall take retaliatory action against any employee
43 because the employee does any of the following:
44 (a) discloses or threatens to disclose to a supervisor, or to a public
45 body an activity, policy or practice of the employer or agent that the
46 employee, in good faith, reasonably believes constitutes fraud, crimi-
47 nal activity or other malfeasance; or
48 (b) objects to, or refuses to participate in any activity, policy or
49 practice of the employer or agent that the employee, in good faith,
50 reasonably believes constitutes fraud, criminal activity or other
51 malfeasance.
52 3. Enforcement. An employee may seek enforcement of this section
53 pursuant to paragraph (e) of subdivision four of section seven hundred
54 forty of this article.
55 4. Relief. In any court action brought pursuant to this section it
56 shall be a defense that the personnel action was predicated upon grounds
A. 7280 12
1 other than the employee's exercise of any rights protected by this
2 section.
3 § 19. Subdivision 4 of section 740 of the labor law is amended by
4 adding a new paragraph (e) to read as follows:
5 (e) Notwithstanding the provisions of paragraphs (a) and (c) of this
6 subdivision, an employee who has been the subject of a retaliatory
7 action by an employer in violation of section seven hundred forty-two of
8 this article may institute a civil action in a court of competent juris-
9 diction for relief as set forth in subdivision five of this section
10 within two years after the alleged retaliatory personnel action was
11 taken. In addition to the relief set forth in such subdivision five, the
12 court, in its discretion, based upon a finding that the employer acted
13 in bad faith in the retaliatory action, may order the employer to termi-
14 nate the supervisor who retaliated against the employee.
15 § 20. The penal law is amended by adding a new section 190.72 to read
16 as follows:
17 § 190.72 Defrauding a public pension plan.
18 A person is guilty of defrauding a public pension plan when he or she
19 engages in a scheme constituting a systematic ongoing course of conduct
20 with intent to obtain a benefit or asset, or assist a third party to
21 obtain a benefit or asset, from a public pension plan to which he or she
22 or the third party is not otherwise entitled to pursuant to the
23 restriction of section two hundred eleven of the retirement and social
24 security law.
25 Defrauding a public pension plan is a class E felony.
26 § 21. Section 211 of the retirement and social security law is amended
27 by adding a new subdivision 9 to read as follows:
28 9. A retired person receiving a retirement allowance who is employed
29 and earning compensation in a public service position or positions with
30 the total compensation exceeding the limitations set forth in section
31 two hundred twelve of this article and such person has not obtained the
32 requisite waiver set forth in this section, as well as any person who
33 knowingly assists another person in receiving a retirement allowance
34 while receiving total compensation in a public service position or posi-
35 tions exceeding the limits of section two hundred twelve of this article
36 and not having obtained the requisite waiver, is guilty of larceny and
37 punishable as provided in the penal law.
38 § 22. This act shall take effect January 1, 2010.
