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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

Long Island Business News

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917.796.1801

david.winzelberg@libn.com

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S. News

Supreme Court Hears Union-Fee Challenge

Case Involves Public-Sector Union Authorization to Collect Certain Fees From Nonmembers

By
connect

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

SuffolkLONG ISLAND

Islandia deputy mayor: Residents kept in dark on OTB casino plan

Updated July 27, 2016 6:00 AM
By Carl MacGowan carl.macgowan@newsday.com

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Deputy Mayor Diane Olk says village mailings announcing a July 5 public hearing on a casino proposed for the Islandia Marriott had been delivered only to "a select few" residents. Photo Credit: Newsday / John Paraskevas

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Islandia’s deputy mayor has accused village officials of deliberately keeping many residents in the dark about a controversial Suffolk OTB casino proposal.

During a village board work session Tuesday night, Diane Olk said village mailings announcing a July 5 public hearing on the casino issue had been delivered only to “a select few” residents. In some cases, she said, letters announcing the meeting were placed in residents’ doors rather than sent by mail.

Olk called for the public hearing to be reopened because some residents were unaware of the July 5 meeting because of the lack of advance publicity.

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“A lot of misinformation is out there with a lot of our residents,” Olk said at the work session. “Yet there were a select few that received one mailing or one letter put in their doors.”

Mayor Allan M. Dorman, a casino proponent, accused Olk of being a no-show at village meetings. He did not address how many homes received mailings about the casino plan.

“I’m glad, OK, that you are finally getting involved in something,” he said to Olk. “You’re making this part of your political campaign. . . . This village will move on.”

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Dorman and Olk both are up for re-election next year.

Olk on Wednesday denied missing village meetings. Dorman did not return calls on Wednesday.

Business19 projects, developments that could change LI

The work session was the village board’s first meeting since Dorman canceled a July 12 vote on the casino proposal.

Delaware North, the Buffalo entertainment giant developing the casino for Suffolk County Regional Off-Track Betting Corp., is seeking a special permit to build a casino with 1,000 video lottery terminals inside the Islandia Marriott Long Island hotel, on the Long Island Expressway north service road.

OTB officials have said the casino is a key part of their plan to help the agency emerge from bankruptcy. Dorman has said the casino could help the village reduce property taxes.

Dozens of speakers at the July 5 public hearing spoke against the casino. Fewer than 10 supported the proposal.

Dorman has said he canceled the July 12 vote because the board needed time for “due diligence” before voting on it. The vote has not been rescheduled.

During a meeting of the Islandia Village Board on Tuesday night, July 26, 2016, Islandia Deputy Mayor Diane Olk, left, accuses village officials of deliberately keeping many residents in the dark about a controversial Suffolk OTB casino proposal. At right, Mayor Allan Dorman listens to her remarks. Photo Credit: Newsday / John Paraskevas

The village board’s next scheduled meeting is Tuesday at 7:30 p.m.

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Olk’s comments on Tuesday received applause from most of the approximately 35 people, many of them casino opponents, attending the meeting. Olk later was congratulated as she left after the meeting.

“She’s wonderful,” Arnold Rosenberg of Hauppauge said, adding the casino would “destroy the area.”

Olk said after the meeting she had kept an “open mind” about the casino. She said that changed when she learned about a June 23 letter announcing the July 5 hearing.

She said the letter was received by “two very small groups of people,” including about 20 homeowners. The village population is about 3,300.

The two-paragraph letter, addressed “Dear Neighbor” and signed by Dorman, refers to Delaware North and the special permit application, but does not mention Suffolk OTB, the hotel or video lottery terminals. Olk showed the letter to a Newsday reporter.

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Olk, who has been a village trustee for 11 years and also serves as deputy mayor, said she previously has run for office with Dorman as a running mate. She said she does not plan to be part of Dorman’s ticket next year.