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.”
Taxpayers will be footing the bill for Cuomo’s gift to unions
When Gov. Andrew Cuomo recently signed a billmaking it harder for government workers to escape labor unions, he said it was just “the first step of the resistance.”
Translation: It wasn’t the last favor Cuomo hopes to do for New York’s powerful public-sector unions in anticipation of the coming US Supreme Court decision in Janus v. AFSCME, which could void state laws compelling government workers to pay dues-like agency fees to unions they choose not to join.
The bill Cuomo signed is a wet, sloppy kiss for union leaders. It gives unions special powers to pressure people into joining, and then makes it extremely difficult for workers to leave if they change their mind.
What’s more, the unions no longer have to provide services for workers who are covered by their contracts but aren’t paying dues, despite having rigged the system to prevent these nonmembers from being represented by rival unions.
There’s little more Cuomo could do for unions short of subsidizing them directly.
Which, in fact, might be what he has in mind next.
At stake for New York in the Janus case are at least $862 million in annual revenues the unions now rake in from state and local government workers who, under current law, know they’ll be forced to pay even if they opt-out of membership.
Political allies of government unions, such as Mayor Bill de Blasio, argue “labor stability” relies on providing resources to the unions in the form of agency fees from nonmembers.
If the Supreme Court stops compulsory agency fee payments, the governor and legislators may well use the same rationale to justify subsidies of unions’ “representational” functions.
Consider, for example, what Hawaii state lawmakers proposed in 2016, when the Supreme Court seemed poised to end agency fees as part of its ruling in Friedrichs v. California Teachers Association (a case that ended in a draw after the sudden death of Justice Antonin Scalia).
Aloha State pols wanted to steer public money into a “public employees’ collective bargaining fund.” Their rationale? Ending the fees would “fundamentally undermine this legislature’s consistent efforts to ensure labor management peace.”
In reality, there is no evidence that agency fees contribute to “labor peace.”
In fact, the already high number of public-sector strikes in New York actually rose for several years after compulsory agency fees were authorized in 1977; strikes only dropped off in the early 1980s, in New York and across the country, after President Ronald Reagan’s high-profile firing of striking air-traffic controllers.
Subsidizing even a fraction of $862 million in union revenues wouldn’t just be expensive. It would also create new potential for misuse of public funds. After all, government unions have been caught miscategorizing expenses to conceal their political activity, and must disclose little about how they spend the money workers are forced to pay them. Nothing would stop the unions from routing public money into the same political uses.
When unions provide workers with real value for their dues payments, they won’t have trouble attracting and retaining members.
When they don’t, it shouldn’t be up to taxpayers to make up the difference — propping up organizations whose fundamental goal is to squeeze more money out of public budgets.
Beyond the dollars-and-cents impact, everything a government union does is inherently political — which is what brought the Janus case to the Supreme Court in the first place.
Our constitutional guarantees on free speech and free association mean no one can be forced to support a political cause they don’t agree with, whether they’re workers or taxpayers. Subsidizing government unions with public funds would do exactly that.
Cuomo has been fairly obviously scrambling to pander to labor unions ahead of September’s gubernatorial primary. It would be a shame if he stomped on the First Amendment in the process.
Ken Girardin is an analyst at the Empire Center for Public Policy.
Ken Girardin is an analyst at the Empire Center for Public Policy.
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