How Might The Trump Presidency Impact Municipal Governments?...

By Roberta A. Jordans and David M. Rothman

While the impact upon municipal governments from a Trump Presidency will not be known for some time, there appears to be at least two areas which, according to  press reports, could be impacted:  infrastructure and municipal debt.  Infrastructure improvements could have a major impact on municipals governments, in particular, their budgets.

During his victory speech in the early morning hours of Wednesday November 9, 2016, President-Elect Trump stated that among the things to be done by his administration will be to “rebuild our highways, bridges, tunnels, airports, schools, hospitals.  We’re going to rebuild our infrastructure, which will become, by the way, second to none, and we will put millions of our people to work as we rebuild it.”  This build-out of transportation, water, telecommunications and energy infrastructure across the country is estimated to cost $1 trillion over the next decade.  The plan proposes providing tax credits to private developers to build roads and bridges, among other projects, with the developer then owning the infrastructure and collecting any fees imposed for usage (tolls etc.).

Many have questioned whether Trump’s infrastructure proposal is feasible, including Forbes, which noted that many infrastructure needs will not generate revenue. New York State Senator Chuck Schumer, just this week, stated that direct federal spending must be part of any proposed infrastructure investment.  Since private development would presumably only be utilized where revenue is generated and/or in support of larger developments, direct federal spending allows governments to use funds on needed projects that otherwise may not attract such investment.

Earlier this year at his State of the State address, Governor Cuomo announced a series of infrastructure initiatives.  As reported on the NYMuniBlog, it has been more than 50 years since this country last saw an “infrastructure boom” and that infrastructure has mostly reached the end of its useful life.  As bridges and roads age, ongoing repairs and maintenance becomes more time consuming and costly.  However, funding infrastructure improvements, let alone upgrading and replacing an entire bridge, road, or tunnel, is also extremely expensive.

As noted in a recent New York Times article, while our national infrastructure may be in poor condition, it is uncertain how much economic growth investment in infrastructure really creates.  Perhaps as important, the article notes that the federal gas tax has not changed from 18.4 cents per gallon since 1993 while inflation and fuel efficiency improvements have resulted in a reduction of available funding for infrastructure maintenance, a reduction which is, in turn, met by contributions from other sources.

Some states have their own gas tax to pay for infrastructure or increased their sales tax, as Virginia has, to pay for infrastructure.  The current governor of Michigan Rick Snyder (R-MI), has proposed raising taxes to spend an additional $1 billion a year on infrastructure.  Congressman John Delaney (D-MD), has proposed a tax break to those firms that repatriate foreign profits if a portion of those funds are spent on infrastructure bonds.

In New York, a 2009 research brief published by the Office of the State Comptroller stated 33% of local bridges were “structurally deficient or functionally obsolete” and that there was an underfunding of approximately $80 billion for water, sewer and transportation infrastructure.  A follow up from 2012 concluded that the infrastructure funding gap had risen by $9 billion and an additional study in 2014 concluded that annual spending statewide was $2 billion below the annual need.  A 2015 report of the American Society of Civil Engineers’ New York State Council stated that more than 50% of bridges statewide are more than 75 years old (400 are 100 years old; and 100 are closed) and 33% of “major highways” were in “poor or fair condition”.

Other creative ideas for funding infrastructure have been floated by multiple government entities.  For example, in 2014, it was reported that Governors Cuomo and Christie were considering utilizing the EB-5 visa program to finance infrastructure projects, including the Tappan Zee Bridge.  The EB-5 program offers fast-track citizenship to non-U.S. persons who invest at least $500,000 in approved projects that last more than two years and create the required number of new jobs.  Real estate developers have increasingly been tapping the EB-5 capital because the interest rates on the funds are lower than traditional bank loans.  Although EB-5 funds were not ultimately used for the Tappan Zee Bridge project, the EB-5 program financed infrastructure improvements related to the Barclays Center in Brooklyn and was recently estimated to be part of no less than 100 development projects within the state.

Infrastructure repair and improvement is a priority item for the Trump presidency, but how it will ultimately be financed and which projects will get prioritized, remains to be seen.

New Overtime Rule Blocked By Nationwide Injunction...

By James Beyer

Employers around the country were given a reprieve from the new “white collar” exemption regulations contained in the Fair Labor Standards Act, after a United States District Court Judge in Texas issued a nationwide injunction. The new overtime rule which was blocked contained a number of provisions, but specifically raised the minimum salary level for a “white collar” overtime exemption to $913 per week. Harris Beach has released an in-depth Legal Alert on this topic, which discusses the injunction and corresponding block of the overtime rule in-depth.

For employers in New York, they should keep in mind that New York’s salary thresholds for overtime exemptions are higher than the federal level: to qualify as an exempt administrative or executive employee under New York law, the salary threshold is $675 per week, significantly more than the $455 federal threshold.

It’s unclear if the preliminary injunction against the overtime rule will become permanent. For the Department of Labor, it is able to appeal the ruling to the Fifth Circuit court, but it may not choose to do so given the upcoming change in presidential administrations. Many are speculating that the overall Fair Labor Standards Act will receive further scrutiny following January 20, when Donald Trump takes office.

Cuomo’s $20 Million Municipal Consolidation and Efficiency Competition...

By Roberta A. Jordans

Earlier this month, Governor Cuomo’s office announced the Municipal Consolidation and Efficiency Competition, which tasks local governments with finding ways to work together to reduce bureaucracy, improve government efficiency, and create taxpayer savings.

The Municipal Consolidation and Efficiency Competition has two phases. In the first phase, local governments, forming teams of two or more, submit an intent to propose form for a chance to become eligible for plan development funding. In the second phase, the local government teams submit their plan for consideration. Plans are due in June 2017, and the winner will be announced in August 2017.

The end goal of the Municipal Consolidation Competition is to encourage governments to streamline as well as offer shared services, resulting in lower governmental spend and cost savings that translate into property tax reductions for New York state residents. The winning government consortium will receive a $20 million award to enact the proposed consolidation and efficiency plans.

Governor Cuomo first announced the competition in January 2016, as the ninth proposal of his 2016 agenda.

In a statement announcing the details of the program this month, Governor Cuomo said “Property taxes remain the most burdensome tax in New York and with this competition, we are incentivizing local governments to band together to think outside the box, streamline their bureaucracies, cut costs and deliver real relief to their taxpayers. As I’ve said multiple times, New York has no future as the high tax capital of the world and by encouraging innovation, we are taking one more step toward a stronger, more affordable Empire State for all.”

Property Tax Exemptions & Non-Profit Organizations: What’s the Big Deal?...

By Patrick M. Malgieri

Over the past few weeks, the property tax exemptions granted to certain non-profit organizations across New York state have been making headlines. Notably, USA Today Network conducted research into the issue, publishing the results over the past few weeks in its network of local newspapers.

The report’s findings have surprised some and raised questions as to whether these non-profit tax exemptions are necessary. USA Today’s research estimates that 31% of land in New York is property-tax exempt, belonging to organizations such as universities, hospitals, religious groups, non-profits, and other exempt entities.

Those who are questioning the current tax exemptions do so from a variety of angles. Many cite New York’s current fiscal situation and the fiscal stress that many municipalities are under as the reason to cry foul. Property taxes are the single largest source of revenue for municipalities, so property tax exemptions can be viewed as lost revenues across the state.  Others argue that the property tax exemptions only benefit large land-owning organizations that often have large endowments, investments, and revenue streams, and not small community based organizations that face financial shortfalls.

And a third argument ties it back to the individual property owner. With non-profit and other tax exemptions being granted, individual property owners have a higher tax rate to help make up the exempt tax revenue.

Among the counter arguments is that the positive economic impact provided by tax-exempt organizations’ more than makes up for the property tax breaks. The Commission on Independent Colleges and Universities in New York released a report showing that the state’s private non-profit colleges and universities had an economic impact of $74.3 billion in 2013, which was more than double the property tax exemptions granted. The report also cites the nearly 400,000 jobs the universities provide as well as the many free community programs offered.  The benefits to localities in terms of short and long-term job creation and the generation of other sources of revenue from economic development projects have also proven to be substantial.   Many non-profits also point out that the costs of services they provide to local communities (some portion of which often goes unreimbursed) would only increase if they were compelled to pay full real property taxes to local governments.

This issue is hardly new and it promises to invite ongoing debate at the state and local level as economic development in many communities is increasingly centered around non-profit university and medical research centers and governments, particularly those in smaller or less affluent communities, continue to struggle with providing a level of service to which residents are accustomed or require against the landscape of stagnant or declining revenues.

Sewage Pollution Right to Know Act: What Public Works Need to Know...

By Gene Kelly

Earlier this month, the New York State Department of Environmental Conservation (DEC) enacted the Sewage Pollution Right to Know Act (SPRK). The Sewage Pollution Right to Know Act, which originally went effect on May 1, 2013, contains regulations for public works and similar facilities that discharge both untreated and treated sewage. To help municipalities understand these new rules, Harris Beach has released a comprehensive Legal Alert on the Sewage Pollution Right to Know Act.

The SPRK mandates that all publicly owned treatment works (POTW) and publicly owned sewer systems (POSSs) notify the DEC and Department of Health within two hours for all discharges. Previously, a two-hour notification was only required if the discharge was near a public drinking water intake, a bathing beach, or a shellfish bed.

In particular, the new rules require owners and operators of POTWs and POSSs to report discharges of untreated and partially treated sewage to the DEC and health authorities immediately, but no later than two hours after the discharge occurs. Public works and similar organizations are also required to continue reporting for each day after the initial report until the discharge terminates. There are some special cases however, such as that partially treated sewage discharged directly from a POTW that is in compliance with a DEC-approved plan or permit does not need to be reported.

The rules define a “POSS” as a municipally-owned system that discharges to a POTW owned by another municipality. A POSS is not required to obtain a SPDES permit. DEC has selected the NY-ALERT system to implement the reporting and notification provisions of the rule.

Even though infrastructure upgrades are not mandated by the regulation, there will be changes with fiscal impacts required for owners and operators of systems subject to the regulation. More details on these can be found in our Legal Alert.

 

 

The Government’s Digital Revolution and Planning for Tomorrow...

By David Rothman

A recent article published by CNBC describes the $41 trillion forecast to be invested worldwide by various cities to upgrade infrastructure so as to benefit with technological advances.  This recent news reflects a larger trend of local governments joining the digital revolution, looking to new and emerging technologies when planning for current and future needs.

The improvements range for the use of drones to “heat maps” for reducing traffic accidents and fighting crime as well as addressing traffic congestion and the improvements to other services.

Turturro v. City of New York – Are a City’s Roadway Design Decisions Entitled to Immunity?...

By Bradley Wanner

On November 15, 2016, the Court of Appeals will hear oral argument in Turturro v. City of New York, which puts before the Court the question of a municipality’s entitlement to immunity for its roadway design decisions.  The stakes are high for municipalities across the State because the Court will consider whether the entitlement to immunity should be decided by juries or by a court.  Upholding the rulings of the trial and appellate courts could mark the start of an era where juries are called upon to determine the nature of the duty that is owed by municipalities when they engage in a broad range of planning activities.

In Turturro, several complaints were made to the City of New York regarding speeding vehicles on various sections of Gerritsen Avenue, a four-lane thoroughfare in Brooklyn and also requests for a variety of changes (i.e., traffic lights, crosswalks, etc.).  In response to these complaints, the City’s Department of Transportation conducted multiple studies at several locations along Gerritsen Avenue to evaluate vehicle speed and the need for additional traffic control devices.  Despite concluding that speeding on Gerritsen Avenue was within accepted standards, the DOT installed additional speed limit signs and referred the matter to the police department for increased enforcement.  Unfortunately, on December 5, 2004, the minor plaintiff was struck by a speeding vehicle while attempting to cross Gerritsen Avenue in the middle of the block.

At trial, plaintiffs criticized the City’s response to the speeding complaints.  However, plaintiffs’ expert (1) admitted that speeding is primarily a matter for law enforcement, (2) failed to establish that the City’s response to the complaints violated accepted practices, (3) failed to establish the existence of prior similar accidents, and (4) admitted that he had not performed any study to determine what additional traffic control measures the City could have implemented.

Breaking with the usual practice where the court decides as a matter of law whether the conduct complained of was discretionary or not, the trial court allowed the jury to decide whether the City’s “study” of the speeding complaints was “proper and adequate”, which resulted in a $36 million verdict in favor of plaintiffs.  The City appealed to the Second Department, which upheld the verdict.  Thereafter, the City was granted leave to appeal to the Court of Appeals.

Both the trial and appellate courts refused to give the City the benefit of qualified immunity for its roadway design decisions, instead permitting the jury to second-guess the City’s actions.  By allowing the jury to decide whether the City was entitled to qualified immunity, the trial and appellate courts essentially sanctioned the second-guessing that the qualified immunity doctrine is intended to prevent.  Thus, Turturro presents critical cross-roads for municipalities, as the Court will either reaffirm the traditional deference to a municipality’s roadway design decisions or set a new course for roadway design matters where juries are permitted to second-guess such decisions.

Allowing juries to pass judgment on the exercise of governmental discretion would represent a significant erosion of the protections that have traditionally been afforded to government planning decisions under New York law.  It would also put New York at odds with the trend in jurisdictions around the nation, which place the immunity question with the court.  When the Court decides which path to take, however, it will have an amicus curiae brief from the International Municipal Lawyers Association (drafted by Harris Beach) to hopefully persuade the Court that (1) entitlement to immunity should be decided by a court, not a jury, and (2) roadway design decisions are discretionary governmental functions entitled to immunity.

New Regulations Affect Airbnb and Other Short-Term Rentals in New York State...

By Lauren Baron

The short-term rental company Airbnb has received attention in recent news relating to the now enacted New York state legislation that prohibits any type of advertisements for rentals that are fewer than thirty (30) days in permanent Class-A units, and imposes a fine of up to $7,500 per occurrence for those who violate the advertising prohibition three or more times.  The new regulations prevents companies like Airbnb from advertising in any medium for short-term rentals in Class-A units.  A Class-A unit “is a multiple dwelling that is occupied for permanent residence purposes.”  Article 1, Section 4 of the New York State Multiple Dwelling Law already prohibits short-term rentals of less than thirty (30) days in permanent Class-A units where the unit owner is absent and receives payment for the short-term rental.

The legislation was signed into law by Governor Cuomo on October 21, 2016.  The Senate and Assembly justified the bill as a safety measure to ensure that all buildings comply with applicable safety and building codes, as well as a way to protect those individuals seeking affordable housing.  Research on the New York City housing market indicates there may be a detrimental correlation between the increase in short-term rentals and an increase in the cost of rent in the New York City area.  Some studies have found that as more unit owners convert their units into short-term rentals, sometimes converting entire buildings, the already diminished inventory for housing options in New York City becomes even more depleted, leading to an increase in rental rates.

Beyond New York City, other municipalities in New York State have taken more localized steps to regulate short-term housing rentals.  For example, the Village of Skaneateles amended their zoning code in 2015, stating “[n]o overnight accommodation for compensation or barter shall be permitted anywhere in the Village for less than 30 consecutive days except in a hotel, lodging, or a bed-and-breakfast homestay.”  The zoning code specifically defines the terms hotel, lodging and bed-and-breakfast homestay, and requires an owner to be physically present in a dwelling if it is used as a bed-and-breakfast homestay.  In enforcing its amended zoning code, the Village of Skaneateles has already issued violations against building owners who provide short-term rentals while they are absent from the property.

Prior to Governor Cuomo signing the bill into law, Airbnb had adamantly threatened to sue, and after the bill became law, Airbnb followed through and filed a lawsuit arguing the legislation is unconstitutional.  Critics of the bill also state it is an attempt by the powerful hotel industry to stifle competition and that the bill will do nothing to alleviate the problems its proponents have focused on, such as targeting building owners who are turning multiple units into short-term rentals or creating illegal hotels.

Supreme Court Accepts Transgender Bathroom Case...

By Jim Beyer

On October 28, the U.S. Supreme Court accepted a high-profile case involving bathroom access for transgender students. The case, Gloucester County School Board v. G.G., is just one of many recent cases to make headlines since the federal government’s Dear Colleague letter was released in May 2016. However, this is the first of such cases to be heard by the Supreme Court.

At issue is whether or not the U.S. Department of Education is allowed to interpret the federal Title IX prohibition on sex discrimination in schools to include gender identity. A previous ruling in the Fourth Circuit sided in favor of the Department, citing that the department has a right to interpret its own regulations.

However, the Gloucester County School Board is arguing that the Department of Education went beyond interpreting and clarifying an existing regulation, and instead has altered the actual Title IX statute.

This decision in this case will be highly anticipated, not only because of its potential effect on other similar cases and the larger issue of transgender rights, but also because of the potential for a tie, given the Supreme Court’s current lack of a ninth member.

The case is Gloucester County School Board v. G.G., By His Next Friend and Mother, Deirdre Grimm, case number 16-273, in the Supreme Court of the United States.

Zoning and Building Codes for Tiny Houses – The Next Big Thing...

By Lauren Baron

Tiny houses are quickly becoming the next big thing. From tiny house television shows, to tiny house conferences – small-sized homes are gaining in popularity and beginning to pop up across the nation. For prospective owners, beyond designing and building a tiny house, owners must also consider where the home will ultimately reside. And as pint-sized homes become more popular in New York and other states, municipalities must consider how tiny houses fit within existing zoning and building codes.

For example, is a tiny house, in fact, a house?  In New York, a tiny house on a trailer that must be towed is considered a trailer within the meaning of the New York State Vehicle and Traffic Law and must be registered with the New York State Department of Motor Vehicles (“DMV”).  However, if the tiny house meets the length or square footage requirement for a mobile home, it may need to be registered as a mobile home with the DMV rather than a trailer.

Just because a tiny house owner obtains a DMV registration and title for it as either a trailer or mobile home does not mean additional permits or approvals are not required based on the local municipality’s zoning and building codes.  For example, the applicable municipal zoning code may have a separate definition for the terms “mobile home” or “trailer” that could apply to a tiny house, and may even prohibit mobile homes or the storage of trailers in certain zoning districts.

Further, a tiny house may fall within the definition of “dwelling unit” under many zoning and buildings codes, which contain minimum size and permitting requirements to construct a dwelling unit. Building codes also have certain safety standards to ensure a structure is safe to be used as a dwelling. Prospective tiny house builders should work with local code enforcement officers and municipal boards to ensure that their tiny house complies with these requirements in order to avoid potential zoning or building code violations.

Some municipalities throughout the country are embracing the tiny house movement and adding provisions to their zoning and building codes to define and allow “accessory dwelling units,” which are small dwelling units that can be placed on the same property as a larger dwelling.

As the popularity of tiny houses grows, municipalities may want to incorporate provisions into their zoning and building codes to more clearly regulate tiny houses to eliminate confusion for prospective tiny house owners and potential neighbors as to permitting requirements and where tiny houses may or may not be allowed within a particular municipality.

Medical Marijuana in the Workplace: What You Need to Know in New York State...

By Kyle Sturgess

Is your company prepared to handle medical marijuana in the workplace? Are you familiar with the issues, including the disability accommodations, that surround medical marijuana use? If your answer is “no,” “I’m not sure,” “we still have questions,” or a variation of these, you should attend Harris Beach’s upcoming webinar/seminar on medical marijuana in the workplace.

On October 27 at 8:00 a.m., Harris Beach will present an informative webinar that covers the myriad of legal and workplace issues surrounding medical marijuana use. Many employers are not aware that New York’s Compassionate Care Act establishes employment protections for medical marijuana use, and there are also protections included in the disability provisions of the New York State Human Rights Law. Businesses with four or more employees in New York must provide “reasonable accommodations” to employees or prospective employees who are certified to use medical marijuana.

To learn more, and help your business be prepared for potential employee use of medical marijuana, attend the webinar on October 27. For those in the Rochester, New York area, the session is also being held live at Harris Beach, and you may choose to attend in person.

Register for the Medical Marijuana in the Workplace webinar today.

Will Economics or Regulations Address the Issues Surrounding Shared Economy and Online Businesses Platforms?...

By David Rothman

In a January 2016 posting we commented on the city of San Francisco seeing the economic effects of Uber and Lyft, including that Yellow Cab, the largest taxi company in San Francisco, was reported to be seeking bankruptcy protection.  Uber and Lyft are both headquartered in San Francisco. We have also posted on Uber’s push to expand in New York, claiming to have the potential to create up to 13,000 full and part time jobs.

While the prior posts focused on the potential decrease in demand and value of taxi medallions, other events are worth mentioning.  Action by Uber and Lyft to cut fares in an effort to increase each company’s’ respective market share has had a substantial economic impact on their bottom lines. It’s been reported that both Uber and Lyft are facing significant financial losses.

These actions, and others in the online business community, have started a debate amongst economists and public policy analysts, including the Harvard Business Review (HBR). The HBR published an article arguing that no regulatory regime is necessary, whereas the Unified Repository Base on Implementation Studies (part of the European Parliament, this particular study was published by the U.K. House of Lords) is considering the creation of a regulatory platform “with caution.”  The fact that the European Union is considering a regulatory regime is important because the E.U. has the largest use of the Internet by residents (77%) of anywhere on the planet.  The House of Lords report has repercussions to businesses in the “shared” community such as AirBnB, and eBay, as well as more traditional online platforms such as Amazon and others.

Whether market economics of supply and demand or the creation of “a better mouse-trap” is sufficient to address the regulations of online businesses is something now being debated amongst various economists and elected officials.

Today, online platforms are such a part of our daily lives that companies such as Amazon, Google, Twitter and Uber are virtually taken for granted.  These companies, and others, have provided additional choice for consumers and driven market efficiencies to the benefit of consumers.

The Case Against Regulation

The European Union published in May of this year its summary of what it identified as key issues related to the role of online platforms within the E.U.  While the E.U. currently has rules regarding consumer protections and the safeguarding of personal data is required of online platforms, the report concluded that new regulations be promulgated only where “deemed necessary” and online business should not be hampered by “burdensome regulation.”  The report further recommended an E.U.-level approach rather than a national approach so as to provide a consistent outcome for online platforms throughout the E.U.

Around the same time as the E.U. Commission report, the Harvard Business Review (add link or hyperlink to full Harvard Business Review) published a piece stating that the online business platform needs no additional regulatory regime as these “businesses have not redefined industries in a fundamental way; instead they are ‘old wines in new bottles’” and therefore existing regulations apply – no new regulations are necessary.

Current Regulatory Efforts

New York State in fact has adopted legislation, currently sitting before the Governor, which would regulate AirBnB within New York City. Strongly opposed to this, AirBnB announced on September 7, 2016 that it would sue the State should the Governor sign this bill into law.  Various other municipalities have enacted legislation which has not resulted in such threats, however, the City of New York is reported to be AirBnB’s most lucrative market and therefore this legislation may impact AirBnB’s financial viability.

Also in New York state, the Village of Skaneateles enacted an ordinance banning short-term (under 30 days) rentals, although hotels, lodges and bed and breakfasts with a special use permit are exempt from the ordinance.  In June 2016, several homeowners reportedly pled guilty to violating this ordinance.  In Florida, the City of Miami Beach has a similar ordinance, the enforcement of which has resulted in fines of more than $1.6 million against homeowners and websites as well as the eviction of tourists staying at 31 properties.

And across the country in Texas, the City of Austin enacted regulations requiring all drivers be fingerprinted by February 2017, whether an Uber, Lyft or taxi driver.  In May 2016 both Uber and Lyft ceased operations in Austin due to this requirement, arguing it does not advance safety of passengers, while seeking an amendment to that regulation by the city council.  As reported in August by CNBC, up to 10 new companies have “filled the void” left by Uber and Lyft ceasing operations with many of these new companies reportedly hiring former Uber and Lyft drivers.  Other cities in Texas have similar regulations, but have not had Uber or Lyft operating within those cities.  At present Lyft is reportedly seeking a state-wide regulation so as to avoid similar issues on a city by city basis.

Market Economics

In August 2016 Bloomberg reported that Uber lost “at least $1.2 billion in the first half of 2016” with subsidies to Uber drivers comprising a “majority of the company’s losses globally.”  Those subsidies, per the Washington Post in August 2016, were worth up to $500 per driver for making pick-ups in certain cities.  This is part of a larger “price-war” between Uber and Lyft with Lyft providing its own incentives to its drivers.  Uber also cut passenger fares in many cities this past January while also reducing the commission its drivers pay.  These fare cuts resulted in increased ridership but upset drivers who then protested Uber’s actions this past May.  Lyft drivers likewise were upset when Lyft reduced its fares in April of this year.  Recent reports suggest losses at Uber are more than $4 billion over Uber’s 7 year history, while an August report suggests Lyft may be losing up to $50 million per month.

Both companies have financial backing and are each believed to seek dominant market share based on the strategy that achieving long-term dominance will result in profits and ultimately will justify these initial operating losses.  Time will tell whether undercharging customers so as to achieve market share supremacy was smart business but it is possible that at least one of these companies will lose financial backing and become a trivia question.

What’s in a name? NYSED releases a draft revision of learning standards to replace the Common Core...

By Howard J. Goldsmith

The New York State School Boards Association (NYSSBA) in its September 26, 2016 edition of On Board, reported that the Board of Regents (“Regents”) has released draft revisions of the revised state learning standards to replace the Common Core Learning Standards. This initiative is the result of one of the recommendations from the December 2015 report from the Governor’s New York Common Core Task Force. The report’s first recommendation is for the Regents “to adopt high quality standards with input from local districts, educators, and parents through an open and transparent process.” Basically, undoing the silo work of the previous Commissioner and Regents Chancellor which led to the adoption and implementation of the Common Core Learning Standards.  The revised standards are the result of this multi-phase re-boot started in April 2016 when the State Education Department (SED) convened English Language Arts Standards and Math Learning Standards Review committees comprised of over 130 teachers, administrators, parents and higher education representative. In the SED press release issued with the revisions, Regents Chancellor Rosa stated: “Learning standards form the very framework of our educational system, so it’s critical that we get this right for all our students.”

In addition to a period of public comment and review, On Board reports that the Regents are expected to start reviewing the new standards –  and possibly give them a name – in early 2017. As Shakespeare said: “What’s in a name? that which we call a rose By any other name would smell as sweet.” This is one of Shakespeare’s most famous lines in the central struggle and tragedy from Romeo and Juliet. It is the perfect framework to consider the struggles and lost opportunities New York’s educational stakeholders have gone through over the past five plus years to return to the natural and common sense approach of teamwork, consensus building, and transparency.

Naming the revised standards is not difficult and is rooted in the pre-Common Core, pre-RTT positive work and history of achievement by the Regents and the State Education Department. We do not need a name for the revised standards since we already have a name that is well respected and has been emulated by other states for years. The standards adopted by the New York State Board of Regents under its authority in the Education Law are “The New York State Learning Standards.”  There is no mention of the Common Core or any other name for New York’s student learning standards. As clearly set forth in section 100.1(t) of the Commissioner’s Regulations: “State learning standards means the knowledge, skills and understandings that individuals can and do habitually demonstrate over time as a consequence of instruction and experience.” The regulations go on to describe the New York State Learning Standards to be organized into seven general curriculum areas: 1) English language arts; 2) Mathematics, science and technology; 3) Social studies; 4) Languages other than English; 5) The arts; 6) Health, physical education and family and consumer sciences; and, 7) Career development and occupational studies.

In the past, SED periodically reviewed and revised various curriculum areas within the New York State Learning Standards. New versions were referenced by the last year reviewed and revised, but the standards always kept the same name, identity, and label of excellence. The revised standards were the result of SED leadership with the invaluable teamwork from teachers, administrators, school boards, and other education stakeholders from across the state. The initiative of bringing together diverse standards review teams for this important work is not a new model as may be misunderstood from the SED press release. It is new when compared to the recent Regents’ history of developing and adopting the Common Core Standards. But this model of teacher participation, state buy-in, and organized implementation in regards to standards review, professional development, and alignment with assessments is not, and has been undertaken through SED’s Office of Curriculum and Instructional Support numerous times in past years.

So the naming of the revised standards is not difficult and is already done. This rose of a name, The New York State Learning Standards, fits in well with the efforts of Commissioner Elia and Chancellor Rosa. They openly admit their focus is to correct the damage of the previous flawed implementation to regain the confidence, support and respect of teachers, administrators, parents, and boards of education.

The real work of the Regents is not just maintaining the standards review process, but making it systematic and regular. With today’s dynamic and constantly changing global environment and competitive workforce with cutting edge technologies, there is no such thing as the status quo. The content of our New York State Learning Standards are either moving forward or they are moving backwards. Relying on any constant framework for learning standards within our changing world means we are moving backwards. Standing still is simply not an option.

This process must include an ongoing established system with long term funding that is directed and dedicated for this purpose. The Regents need to develop and adopt a chart that cycles each of the seven general curriculum areas through a multi-year analysis that includes not just committee review and recommendations to revise and update the respective content of the standards; but public outreach, professional development, statewide implementation strategies, curriculum adjustment and development, assessment alignment, and feedback. This multi-step cycle will be laid out over a period of years for each of the curriculum areas. The seven standards areas will each get the same level of attention but be on its own step within the perpetual cycle. Once the loop is completed with the feedback cycle, the respective standard area starts again on this ongoing cycle of review, revision, adjustment, implementation, alignment and feedback.

Once the Regents and SED develop this full process to the benefit of our current and future New York State students, they can take up the challenge of naming this system. They can call it whatever they want, but if it allows New York students, educators, schools, and SED staff to once again be the model of educational excellence and innovation, it will smell as sweet as a rose.

Federal Funds Coming to Suffolk County for Fire Island to Montauk Point Plan...

By Anthony Manetta

The U.S. Army Corps of Engineers’ ambitious Fire Island to Montauk Point (FIMP) project aims to put $1.2B in federal funding to work in Suffolk County. The FIMP plan, which was first proposed and funded in the aftermath of Hurricane Sandy, would strengthen Long Island’s coast against future flooding and storms. The areas of focus are along Suffolk County’s south shore including the Towns of Babylon, Islip, Brookhaven, Southampton, East Hampton and the Fire Island communities. The FIMP plan calls to raise or flood-proof about 4,400 homes, elevate 5.9 miles of roads and build new berms and dunes.  In addition, the Town of Brookhaven has called for the voluntary buy out of homes and other structures near the water.

However, the FIMP plan is not without controversy. Local residents have had mixed reactions to the proposal, which is now years behind schedule. The FIMP plan public comment and review period, which involves a team of agencies including U.S. Army Corps of Engineers, New York District, the NYS Department of Environmental Conservation, Suffolk County and the Department of Interior, has been extended to October 18, 2016. Assuming the plan moves forward, work is not expected to begin until 2018.

While the plan may be delayed, and represents a significant federal investment, the funds and monies accessed to rebuild beaches, dunes and berms can yield significant future savings as a preventative measure.

40 Municipalities Designated as ‘Fiscally Stressed’...

By David Rothman

New York State Comptroller Thomas DiNapoli’s office has released its latest fiscal stress report, which has identified 40 municipalities as fiscally stressed. The designation of ‘significant fiscal stress’ was given to the counties of Monroe, Franklin, Broome and Rockland; the cities of Albany and Port Jervis; and the towns of Tuxedo and Parish. 14 additional communities were identified as under ‘moderate fiscal stress’ and 18 were listed as ‘susceptible to fiscal stress.’

The monitoring system used by DiNapoli’s office takes into account a variety of factors which are used to develop a fiscal condition score. Inputs include fund balance, cash-on-hand, and patterns of operating deficits. The Comptroller’s office also assigns an environmental score which includes population trends, and poverty and unemployment rates.

This latest report, which continues the trend of less than positive financial information being released by the State Comptroller’s office, is based on 2015 financial information and only includes municipalities with fiscal years ending on December 31. In total, 1,043 communities are on such fiscal years.

The State Comptroller’s office also released a report detailing the three-year trend in fiscal stress, which noted that 65 communities were listed as ‘fiscally stressed’ at least once over the last three years. The counties of Monroe, Rockland, and Franklin have been listed in the ‘significant’ category for the last three years.

Webinar: The Fair Labor Standards Act for Public School Districts and BOCES...

By Sara Visingard

Changes to the federal Fair Labor Standards Act (FLSA) go into effect December 1, 2016, and with this comes updated rules for exemptions to the FLSA’s minimum wage and overtime requirements. On October 13, Harris Beach PLLC is offering a webinar which will review the FLSA as it applies to schools. The webinar will highlight some of the special rules applicable to employees of public school districts and BOCES in regards to the FLSA, as well as assist in the understanding of the application of these rules in the educational establishment context.

Registration for the webinar as well as more information is available here.

New Cybersecurity Regulations Proposed for the Banking and Insurance Industries...

By John Forbush

Concerns over protecting the technology and computer networks that are critical to the U.S. economy and national security are ever-present in the minds of government officials and other policymakers. However, as many of these networks are privately owned and operated, government mandates to protect these networks have been the exception – until now. New cybersecurity regulations for the banking and insurance industries have been proposed by the New York State Department of Financial Services (DFS), entitled Cybersecurity Requirements for Financial Services Companies.

These proposed regulations, which would become effective January 1, 2017 and are explained in our in-depth Legal Alert, require covered financial institutions to implement specified cybersecurity programs and practices aimed at protecting confidential information, as well as information technology systems themselves, from cyberattacks. Beginning on September 28, the proposed regulations will be open for a 45-day public comment period.

These regulations, along with the recent appointment of a Chief Privacy Officer for New York’s school system, points to the increasing focus on cybersecurity in New York, as well as the increasing role government may play in fostering cybersecurity best-practices in the private sector.

Wyandanch Rising Helps Revitalize One of Long Island’s Poorest Communities...

By Thomas J. Garry

Wyandanch, part of the Town of Babylon on Long Island, had long struggled with generating economic growth and development. Wyandanch was known as one of Long Island’s poorest communities, even being identified by a Suffolk County Planning Department report as the most economically distressed community on Long Island.

“Wyandanch Rising” began in 2003, and brought the Town of Babylon together with other local community organizations and citizens to develop solutions to the various economic problems facing Wyandanch. The Town of Babylon adopted the Wyandanch Rising plan in 2004, and the revitalization efforts began immediately.

Today, the Wyandanch Rising project has become a $500 million redevelopment effort, which is focused on transit-oriented development. Harris Beach is proud to have helped make Wyandanch Rising a reality by serving as counsel to the Town of Babylon on the project, and we continue to do so today. Wyandanch Rising involves a unique use of development corporations, the adoption of a form-based zoning code, issuance of tax-exempt bonds and low income housing tax credits (LIHTC), as well as agreements between the Town and Long Island Railroad (LIRR/MTA) concerning the swap of municipal and MTA-owned land in compliance with PAAA and PARA.

The project was recently featured on WLIW21 as part of a special report on Long Island Business.

 

School Water Outlets May Need to be Immediately Tested for Lead...

By Douglas Gerhardt

The new mandate requiring that all school water outlets in New York undergo lead contamination testing was signed into law by Governor Cuomo in early September. These new lead testing requirements were also accompanied by emergency regulations, in which schools may need to test water outlets for lead contamination as soon as September 30. There are also specific reporting requirements which schools and school districts will need to follow.

To help schools and school districts understand these new lead testing regulations, Harris Beach has released an in-depth Legal Alert on the issue. We have also been following this issue closely on the NYMuniblog, and will keep you informed of any new developments, as we expect more information to be released as the testing deadline nears.

Drone Licensing Sees the Light of Day

By David M. Rothman

Here at the NYMuniBlog we have frequently commented on the regulatory and legal issues confronting the use of drones.  Recently published articles in various newspapers have highlighted the continuing uses of drones for both the private sector as well as public sector (police capabilities) uses. In addition, newly released Federal Aviation Administration (FAA) drone licensing regulations have many industry insiders’ predicting an increase in the commercial use of drones.

 

Private Use

It was  reported that over 3,000 people signed up to take the first drone pilot test which was given at the end of August, with the FAA estimating that the number of drone operators could exceed the 171,000 private pilots within the first year.  Demand for the license is so intense that reportedly the University of the District of Columbia Community College set aside 100 slots for drone testing as compared to the slots set aside for the four people who take an FAA exam there every month.

Licensed operators will be allowed to fly drones on a for-hire basis during daylight hours at altitudes under 400 feet and only when the drone is operated within eyesight of the licensed operator, in addition to other restrictions and rules included in the FAA’s Part 107 regulations.  Hobbyists who operate a drone for personal enjoyment are not subject to these restrictions.

Among the early applicants for licensing are expected to be media companies, telecommunications companies, as well as construction, agriculture producers and electrical power companies.

 

Public Use

It is not only commercial users and citizens who continue to explore the use of drones but also municipalities and public entities, who are evaluating drone technology for crowd control, photographing traffic accidents, hostage situations and firefighting.  Municipalities throughout New York state are reported to have purchased, or budgeted to purchase drones while others are researching uses and considering acquiring drones for municipal use.

For municipalities considering drone technology, the FAA advises that municipalities follow the existing small unmanned aircraft system rule, or there is a “Certificate of Waiver or Authorization” for government entities seeking to fly a drone.  Examples of such uses include law enforcement, search and rescue, and disaster relief.

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