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Decision No. 14,957

Appeal of KEVIN ALLARD from action of the Board of Education of the Hoosick Falls Central School District and J.M. regarding a retirement incentive.



(September 17, 2003)


Holbrook & Johnston, attorneys for respondent board, George H. Holbrook, Esq., of counsel

 James R. Sandner, Esq., attorney for respondent J.M., Kevin H. Harren, Esq., of counsel

 MILLS, Commissioner.--Petitioner challenges the legality of a retirement incentive provided to a district teacher ("J.M.") by the Board of Education of the Hoosick Falls Central School District ("respondent board").  The appeal must be dismissed. 

Petitioner is a district resident and member of respondent board.  Based on respondent board"s concerns about the teaching abilities of J.M., a tenured high school English teacher, the high school principal evaluated J.M."s teaching performance four times in the fall of 2001 and once in January 2002.  On each occasion, the principal noted significant deficiencies in J.M."s performance.  Although J.M. received counseling after the evaluations, further monitoring of his performance in February and March 2002 revealed no improvement.  As a result, respondent"s superintendent advised J.M."s union representative that the district was considering commencing a disciplinary proceeding against J.M. pursuant to Education Law "3020-a.

On April 30, 2002, J.M. notified the district that he intended to retire at the end of the 2002-2003 school year.  Subsequently, the superintendent indicated to J.M."s union representative that respondent board wanted J.M. to retire a year earlier, at the end of the 2001-2002 year.  In response, J.M. indicated that he would be willing to do so in exchange for monetary compensation.  After negotiating with J.M."s union representatives, respondent board voted at its June 25, 2002 meeting to accept J.M."s resignation, conditioned on the execution of a memorandum of agreement ("the agreement").  Petitioner did not vote on the motion to accept J.M."s resignation and subsequently commenced this appeal. 

The executed agreement requires respondent board to pay J.M. a total of $48,000 in three installments.  An initial payment of $24,000 was due by July 31, 2003, with two remaining payments of $12,000 due by July 31, 2004 and July 31, 2005, respectively.  In exchange for the payments, J.M. agreed to "release[] and discharge[] [the district] from any and all claims or causes of action he has ever had or now has arising out of his employment with the [district]."  An initial draft of the agreement also required J.M. to acknowledge that the district was "investigating and preparing disciplinary charges against him" and to waive his rights under Education Law "3020-a.  However, that language was deleted from the final agreement, allegedly to avoid public embarrassment to J.M. 

Petitioner contends that the agreement constitutes an unconstitutional gift of funds in violation of Article VIII, "1 of the New York State Constitution and requests that I nullify it.  Respondent board contends that the agreement is proper because it is supported by adequate consideration, including J.M."s waiver of his rights under Education Law "3020-a, even though the agreement does not explicitly state that J.M. waived those rights.  Additionally, respondent board claims that J.M. is a necessary party to this proceeding and that petitioner lacks standing.

J.M., who was joined as a party pursuant to a November 25, 2002 directive from my Office of Counsel, contends that the agreement is supported by adequate consideration because, among other things, he agreed to retire a year early and forfeited his right to receive a terminal pay allowance and to pursue a civil suit against the district for "defamatory comments" made about his "professional competence."

Initially, I must address the reply papers submitted by petitioner.  A reply is not meant to buttress allegations in the petition or to belatedly add assertions that should have been included in the petition (8 NYCRR ""275.3 and 275.14; Application of Bean, 42 Ed Dept Rep ___, Decision No. 14,810; Appeal of O"Herron, 40 id. 204, Decision No. 14,461). Therefore, while I have reviewed petitioner"s reply papers, I have not considered those portions that contain new assertions that are not responsive to new material or affirmative defenses set forth in respondents" answers.

With regard to respondent board"s first procedural defense, I note that J.M. was served with a copy of the petition on December 2, 2002.  Accordingly, I will not dismiss the appeal for failure to join a necessary party.

I also decline to dismiss the appeal for lack of standing.  An individual may not maintain an appeal pursuant to Education Law "310 unless aggrieved in the sense that he or she has suffered personal damage or injury to her or his civil, personal or property rights (Appeal of Tyk, 42 Ed Dept Rep    , Decision No. 14,759; Appeal of Farago, 40 id. 168, Decision No. 14,450, judgment granted dismissing petition to review, Sup. Ct. Albany Co., [McNamara, J.], May 1, 2001; n.o.r.).  The record reflects that petitioner is a district resident and taxpayer.  A district resident has standing to challenge an allegedly illegal expenditure of district funds (Appeal of Gargan, 40 Ed Dept Rep 465, Decision No. 14,528).  Petitioner"s status as a board member does not require a different conclusion. Accordingly, I find that petitioner has standing to maintain this appeal.

Article VIII, section 1 of the New York State Constitution prohibits a gift of public funds to an individual.  This section generally prohibits the expenditure of municipal moneys for the benefit of private parties unless it is in furtherance of a proper municipal purpose and is undertaken pursuant to a statutory obligation or properly authorized contract under which the municipality receives fair and adequate consideration (see, Matter of Antonopoulou v. Beame, 32 NY2d 126; 1989 Opn. State Compt. No. 89-50).  The payment of public funds as
damages for breach of contract or in settlement of a contested claim is not prohibited by this constitutional provision (see, Matter of Antonopoulou v. Beame, supra).

The courts of this State have also recognized that a school board has the right to negotiate the settlement of disciplinary proceedings brought against a teacher to avoid expensive, time-consuming and uncertain litigation (Matter of Cooke v. Bd. of Educ. Lawrence School Dist., 140 AD2d 439; Matter of Cedar v. Commissioner of Educ., 53 Misc 2d 702, aff"d 30 AD2d 882; Matter of Clarke, 20 Ed Dept Rep 596, Decision No. 10,534).  The payment of a sum of money to a teacher under such circumstances in exchange for the teacher"s resignation and general release to the board does not constitute a gift of public funds (Matter of Cooke, supra; Matter of Cedar, supra).

 Matter of Rampello v. East Irondequoit C.S.D., 236 AD2d 797, upon which petitioner relies, is distinguishable.  In Rampello, the court found unconstitutional a retirement incentive that reimbursed a high school principal for his unused sick leave where the district had no obligation to do so under the collective bargaining agreement.  However, in Rampello, there was no evidence that the incentive was offered to settle a legitimate dispute between the parties.

In contrast, the record here reflects that respondent board had serious concerns about J.M."s teaching abilities, which were confirmed through a series of evaluations conducted over the course of several months.  The evaluations reveal significant deficiencies in J.M."s performance that raise questions about his professional competency.  The record also reflects that J.M. disputed respondent board"s challenge to his competency. The record further reflects that although respondent board considered commencing disciplinary charges against J.M. pursuant to Education Law "3020-a, respondent board chose to avoid the uncertainty and delay of the disciplinary process by offering J.M. a retirement incentive of $48,000.  In exchange, J.M. forfeited his right to his tenured teaching position and a $24,000 terminal pay allowance for which he was eligible under the district"s collective bargaining agreement, and also gave the district a general release.
Under these circumstances, I find that the incentive constitutes a proper exercise of the board"s authority to negotiate the settlement of a potential claim to avoid expensive, time-consuming and uncertain litigation (see, Matter of Cooke, supra; Matter of Cedar, supra).