Long Island Business News
Suffolk, Nassau OTB probe ethics conflict
by David Winzelberg
Published: November 24th, 2013
At least one employee of Nassau County Off-Track Betting is questioning whether the head of his employee union, a member-elect of the Suffolk County Legislature, should have a say in Suffolk OTB business.
Teamsters Local 707 President Kevin McCaffery, whose union represents about 200 Nassau OTB workers, was elected earlier this month to serve as a Suffolk legislator representing the 14th District. In a letter last week, Nassau OTB cashier Jackson Leeds alerted the Suffolk County Ethics Board to McCaffery’s possible conflict of interest.
“As a Suffolk County legislator, his duties are to the people of Suffolk County,” Leeds wrote. “He cannot simultaneously represent the interests of employees of Nassau OTB, a Nassau County public benefit corporation.”
McCaffery told LIBN he doesn’t think the two counties’ OTBs are in competition with each other and he doesn’t see his role as union leader for Nassau OTB workers as a conflict with issues surrounding Suffolk OTB.
“If anything, I have the background of dealing with Nassau OTB, which gives me more insight on the subject than any other legislator out there,” McCaffery said.
When asked if the legislator-elect’s union job appeared to be a conflict of interest, Nassau OTB chief Joseph Cairo said, “If you really want to stretch it. But I don’t see anything that’s apparent to me.”
Cairo added that he’ll instruct the Nassau agency’s counsel to review the situation.
Leeds, a 10-year veteran of Nassau OTB, complained that both union officials and county OTB management have been too focused on the 1,000 video lottery terminals planned for each county’s OTB and they’re not paying enough attention to current operations.
“They never worked behind a window,” Leeds told LIBN. “They’re out of touch with the bettors of Nassau County.”
Internet wagering and dwindling handles – the overall money being wagered – have prompted a consolidation in Nassau OTB’s operations in recent years; there were 15 betting offices in Nassau in 2003, and now there are eight. Suffolk OTB, which has seven branch offices, filed for bankruptcy last year.
These days, according to some analysts, OTB offices exist largely for political patronage – another reason, according to Leeds, that the Nassau union chief shouldn’t mix one business with the other.
“Union leaders should not be politicians,” he said. “OTBs are run by politicians. Being political and doing public good aren’t always incompatible, but they often are.”
This isn’t the first time a Long Island legislator’s OTB ties have become an issue.
In May 2000, Gregory Peterson, then-president of the Nassau OTB, sued to prevent Nassau County Leg. Roger Corbin from voting on appointments to the Nassau OTB’s board of directors. Because Corbin was employed as a branch manager for New York City OTB and a member of Teamsters Local 858, which then represented all employees of Nassau OTB, Peterson alleged Corbin’s legislative role posed a conflict of interest.
A New York Supreme Court judge issued an injunction preventing Corbin from voting on OTB appointments, but Corbin appealed and the lower court’s decision was reversed. The Nassau County Board of Ethics also chimed in, determining by a 3-2 vote that voting on OTB appointments didn’t create a conflict because Corbin didn’t influence policy or engage in labor negotiations.
With McCaffery, some observers say it’s best to proceed with caution.
Anthony Figliola, vice president of Uniondale-based government relations firm Empire Government Strategies, said the legislator-elect may want to recuse himself from any votes concerning Suffolk OTB until the Suffolk County Ethics Board offers an opinion.
“OTB is a political football,” Figliola said. “It’s better to stay out of it, especially if you want to get things done in the Legislature.”
David Winzelberg
Reporter
S. News
Supreme Court Hears Union-Fee Challenge
Case Involves Public-Sector Union Authorization to Collect Certain Fees From Nonmembers
Updated Jan. 21, 2014 8:11 p.m. ET
WASHINGTON—The Supreme Court on Tuesday heard a challenge to a decades-old precedent authorizing public-sector unions to collect fees from workers who refuse to join the union but benefit from collective bargaining.
The court's liberals seemed firmly planted on the union side, with Justice Elena Kagan saying that the plaintiffs' argument "would radically restructure the way workplaces across the country are run."
Some conservative justices, in contrast, seemed open to the challenge, which contends that the "agency fees" the state allows the union to collect from public employees violate the First Amendment by compelling them to subsidize bargaining positions with which they may disagree.
"I'm talking about whether or not a union can take money from an employee who objects to the union's position on fundamental political grounds," said Justice Anthony Kennedy, referring, for instance, to a younger worker who might disagree with a union's decision to focus on protecting pensions.
"In an era where government is getting bigger and bigger…this is becoming more and more of an important issue to more people," he said.
The case could further hurt unions fighting to maintain ground in states grappling with financial woes.
Paul Smith, the lawyer representing the union position, said any burden on the objecting employees "arises only because somebody has chosen to come take this job working for the state on terms the state offers."
The union position received a surprisingly sympathetic hearing from Justice Antonin Scalia, who in other cases has joined with conservatives against organized labor's position.
The plaintiffs' lawyer, William Messenger of the National Right to Work Legal Defense Foundation, described the issue as the government compelling individuals to support "lobbying" officials for causes they oppose.
Justice Scalia, however, repeatedly framed the case under precedents that distinguish between the government's function of regulating public conduct, where it is constrained by constitutional protections, and its role as an employer, where it holds much of the discretion private employers have in managing the workplace.
"There are some private employers who think they're better off with a closed shop and they just want to deal with one union," Justice Scalia said. "Why can't the government have the same interest?"
The case originated in Illinois, which authorized home health-care aides to unionize for collective bargaining with the state.
The aides are paid through Medicaid to care for the disabled. One group of health aides voted to join the Service Employees International Union. The union's agreement with the state requires workers who don't want to belong to the union to pay a fee to cover their share of collective bargaining costs.
Justice Samuel Alito questioned the arrangement's origins.
"I thought the situation was that Gov. [Rod] Blagojevich got a huge campaign contribution from the union and virtually as soon as he got into office he took out his pen and signed an executive order that had the effect of putting, what was it, $3.6 million into the union coffers," he said.
Some of the eight plaintiffs are covered by the SEIU agreement but don't belong to the union. Others belong to a separate group of health aides that voted against unionization. Together, they argue that even if public employees can be required to pay union fees for collective bargaining, the health aides shouldn't be classified as state workers because they can be terminated by the individuals who employ them.
The Seventh U.S. Circuit Court of Appeals, in Chicago, rejected the suit, ruling that the aides are state employees and that the union fees are permitted under a 1977 Supreme Court precedent. That decision allows state employees, like those in the private sector, to refuse to fund union activities outside collective bargaining, such as political campaigning.
But if state law allows, union contracts can require all members of the bargaining unit to pay "fair-share" fees for collective bargaining costs.
Solicitor General Donald Verrilli, arguing in support of the union position, said that was justified because the union has a legal duty of fair representation, requiring it to protect all employees in the bargaining unit whether they belong to the union or not.
Although Justice Scalia also questioned Mr. Verrilli, he seemed sympathetic to the free-rider argument. If the challenge prevails, it's not just objectors who might stop paying union fees, he said. Workers might reason, "Hey, I don't have to pay. The union is going to do this stuff anyway."
A decision in the case, Harris v. Quinn, is expected by June.
Write to Jess Bravin at jess.bravin@wsj.com and Melanie Trottman at melanie.trottman@wsj.com
Suffolk County Executive Steve Bellone addresses the media Thursday, May 12, 2016 in Hauppauge. Photo Credit: James Carbone
Suffolk County Executive Steve Bellone has asked the county Board of Ethics to investigate Assistant District Attorney John Scott Prudenti for renting his boat to criminal defense lawyers who allegedly represented defendants in criminal cases Prudenti prosecuted or supervised.
Bellone in a letter obtained by Newsday wrote to the executive director of the ethics panel that the rentals “would seem an obvious and apparent violation of numerous sections of the County’s Code of Ethics that was in effect at the time of the conduct.”
The complaint, dated Monday, cites two Newsday articles, published May 22 and April 25, in which defense attorneys said they paid $1,500 to $5,000 to rent Prudenti’s 47-foot Christina Marie, sometimes for trips where the boat didn’t leave the dock. Defense attorneys also recalled summer parties with lobster, wine and beer attended by top prosecutors and defense attorneys.
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Robert Clifford, a spokesman for District Attorney Thomas Spota, said Tuesday that the office was unaware of Bellone’s complaint and did not comment further.
Prudenti, a bureau chief and 30-year veteran of the Suffolk district attorney’s office, did not respond to requests for comment through Clifford.
Previously, Clifford told Newsday that before 2010 Prudenti chartered his boat, sometimes to attorneys, and served as captain. Those on board covered operating costs, including for bait and fuel. Prudenti also hosted summer gatherings on the boat which remained docked during the parties, and members of the defense bar shared the costs of food and beverages, Clifford said.
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Clifford wrote the summer parties were, “no different than the many other social events that take place every year.”
The letter is the latest salvo by Bellone against Spota and his office. Earlier this month, Bellone called for Spota to resign. Bellone cited Newsday stories detailing how the office failed to investigate alleged criminal wrongdoing uncovered on wiretaps.
Spota said he had done nothing wrong, and that Bellone had a vendetta because of prosecutions of his political allies.
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Bellone’s letter cites a section of the county’s ethics code that says no county employee shall, “engage in, solicit, negotiate or promise to accept private employment or render services for private interests which employment or service creates or might reasonably tend to create a conflict or impair the proper discharge of his official duties.” The letter also cites a section prohibiting conduct that gives “reasonable basis for the impression that any person can improperly influence him or unduly enjoy his favor in the performance of his official duties.”
Anyone guilty of violating the ethics code faces forfeiture of pay, suspension, or removal from the job as well as up to a year in jail, according to the letter.
Bellone also requested all financial disclosure statements submitted by Prudenti be reviewed to see whether his outside business interests were disclosed.
Calls to Board of Ethics executive director Samantha Segal were referred to general counsel John Gross, an attorney for Hauppauge-based law firm Ingerman Smith. Gross declined to comment.
A spokesman for Bellone declined to comment.
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