D.A.'s Long Beach payout probe 'comprehensive'

Singas interviewing council members, city staffers

Posted

Investigators from the Nassau County district attorney’s office have questioned a number of current and former Long Beach City Council members and officials over the past year about separation payouts to employees when they left city government, according to multiple sources close to the investigation.

Additionally, officials from the D.A.’s office have subpoenaed hundreds of documents from City Hall, including emails and personnel records.

District Attorney Madeline Singas’s office is investigating how the city issued the separation payouts to current and former employees, as well as the roles played by current and former top officials at City Hall, and how much City Council members knew about the payments.

Last year, the council rejected a $2.1 million borrowing measure to cover payouts in the 2017-18 fiscal year — including a number of payments to non-union employees who remained on the payroll, and a $108,000 payment to then City Manager Jack Schnirman, who is now the county comptroller.

The rejection of the bond, and the subsequent outcry by residents, triggered an audit by State Comptroller Tom DiNapoli’s office, part of which is expected to be released this summer and will focus on the city’s calculations of accrued time to current and former employees.

Schnirman received a payout amounting to at least 100 percent of his accrued sick days — or $73,100 — when he left the city’s employ, according to a Herald analysis of his payment documents last year. The city’s Code of Ordinances states, however, that non-union, or management, employees like Schnirman should be paid 30 percent of total accrued sick days at the time of separation.

Schnirman’s employment contract, approved by the City Council, also specified that he should be paid 30 percent, which would have been $21,900. A number of other employees also received payouts that exceeded the 30 percent mark.

Schnirman, who was elected county comptroller in November 2017, has called the separation payouts to employees routine, and said they had decreased “as planned” over the years to lower the city’s payroll. He said he had acted on the advice of a previous corporation counsel for the city. Officials have said that the city manager has discretion over the code, based on a legal interpretation that dates back to 1997. Schnirman did not immediately respond to a request for comment for this story.

Miriam Sholder, a spokeswoman for Singas, declined to comment specifically on the investigation. “When allegations of improper payments were raised, we quickly began a comprehensive investigation, which remains ongoing,” Sholder said in a statement. “We have collaborated with the Office of the New York State Comptroller throughout our review as they have been conducting an audit of the subject payments.”

Investigators asking about top officials

Those familiar with the investigation said that representatives of DiNapoli’s office have attended some of the interviews conducted by Singas’s office. According to one person who is familiar with the probe, at least eight former and current council members and employees, as recently as last month, were asked by Singas’s office to answer questions. Some opted to have attorneys present at the meetings.

“They wanted to know a number of things, and asked me questions regarding the contracts we did with Jack [Schnirman], what they included, who prepared them and if I knew what the end results were,” said former City Council President Len Torres. “They asked how much he received in the payout and whether we passed a resolution that allowed for an increase he could walk away with. Of course my answer was no.”

One person who was interviewed, but declined to be identified, said that investigators asked about specific payouts to employees who left or may have intended to leave after the November 2017 election.

“They have all the emails that explains it all in the sense of who was getting what,” the person said.

Torres, and others who agreed to speak with the Herald on the condition of anonymity, said that investigators also asked about the city’s former commissioner of public works, Jim LaCarrubba, who began working for the city in 2012. LaCarrubba resigned in September 2016, but remained employed by the city in a full-time position that many officials and council members believed was part-time.

LaCarrubba initially earned $40,000 per year as an adviser on Hurricane Sandy recovery projects, Schnirman told the Herald last year, but nine months later he was named the city’s director of operations, at an annual salary of $130,000. In total, LaCarrubba received $86,000 in separation payouts.

“They wanted to know whether he was brought back in when he resigned,” Torres said, “and I said I knew he was brought in on a part-time basis, and they asked me why he was brought in on a part-time basis.”

The Federal Emergency Management Agency, Torres replied, “owed us a lot of money [after Sandy], and we needed LaCarrubba in order to get the rest of the money for the boardwalk.”

One person said that they were also asked how LaCarrubba’s time was reported to the state pension system, and one official, who declined to be named, said that LaCarrubba was initially reported as a part-time employee, but later as a full-time employee before he left in October 2017.

Torres also said he was asked about Schnirman’s contract and whether the council had approved an increase in separation pay. “They didn’t ask specifically about the payout,” Torres said. “But they asked about whether there was a vote for an increase [for Schnirman]. They wanted to know if we voted for an increase for exempt employees, and I said no.”

Those interviewed also said they were asked about what they described as an agreement between Schnirman and Corporation Counsel Rob Agostisi, who was appointed acting city manager in January. Agostisi, who has worked for the city for 12 years, received a $128,000 payout in 2017 because he had intended to leave for another job, but attempted to return the payment when he decided to continue working for the city. Unlike Schnirman’s contract, the council did not vote on that agreement.

“The D.A. is asking why the council didn’t vote on it and if they were aware of it,” said one person who was interviewed by investigators.

“They had Jack’s contract and showed it to me, and they asked about his salary, his sick time and whether I was aware if there was any deviation from the contract, and I said I wasn’t aware,” said another elected official, who declined to be named. “They asked me if I knew of any other exempts who had a contract, and the only other one I knew of was [Police Commissioner Mike Tangney’s].”

“It was a lot of general questions, about the relationships between corporation counsel and the city manager,” the official added. Agostisi declined to comment, citing the ongoing investigation.

“The city has been cooperating with this investigation since it commenced in April 2018,” the city said in a statement. “Beyond that, the city has no comment.”

One city official, who declined to be named, said the agreement between Schnirman and Agostisi was not an employment contract, but rather a separation agreement. “This is really a story that hinges on the findings of the state comptroller’s audit,” the official said, adding that they believed the state report on the payouts would be favorable to the city.

Asked about the status of the audit on Monday, Tania Lopez, deputy press secretary for the state comptroller, said, “We’re coordinating with the Nassau County district attorney’s office; however, we do not discuss the specifics of an audit until it is complete.”