Sanitary district problems deeper than Sandy



This is the first of a series of articles that will be published in coming weeks concerning the Oceanside Sanitary District 7, its operations and its supervisors. This article focuses on a Hempstead Town audit completed by then-comptroller Howard Weitzman on December 29, 2009.

The recent election contest between incumbent commissioner Michael Sullivan and challenger Ed Scharfsberg brought out arguably the largest turnout for an Oceanside sanitary district election in more than a decade.

Scharfsberg, a town firefighter and retired NYPD detective, won the election by a nearly a 2-1 margin and it was clear from the comments of those leaving the polling place in Oceanside that the overriding issues of the campaign were the actions of the district in the wake of Hurricane Sandy and the ongoing belief by many residents that the sanitary district is run like a fiefdom, with all of the decisions being made by the commissioners in the proverbial “smoke-filled room” behind locked doors.

The theme of change and transparency in the wake of Hurricane Sandy was apparent from speaking to a number of Oceanside resident waiting their turn to vote outside the firehouse.

“I certainly was not happy with the actions of the sanitation department and with garbage collection after Sandy,” said Ellen Histger. “I am voting for Scharfberg because in Oceanside, the garbage business is dirty business and things have to change. They didn’t do a decent job after the storm and you did not have pick-up for two weeks unless you live on the same block as somebody who works for the district. There are a lot of politically incorrect things that go on with the district.”

In fact, one of Scharfsberg’s campaign promises was to set up a website to “shine a little light” on the activities and finances of the district.

While a district website does now exist, a check this week found that there is little on it besides the telephone number of the district garage.

Now that he has won a seat on the board and was sworn in nearly three weeks ago, that secrecy, he says is impacting his ability to do what he was elected for.

Even though he is now a commissioner, told the Herald this week that he has been unable to get a copy of the last budget approved by the board of commissioners.

He plans to address that issue at the next meeting of the commissioners on August 1.

There are many in Oceanside, who say that the rejection of a nine-year incumbent in favor of a relative newcomer, shows that dissatisfaction with the sanitary district and its leaders goes much deeper than simply what happened after Sandy.

They point to a 47-page 2009 audit of the district by then-comptroller Howard S. Weitzman, the last audit conducted of the sanitary district.

According to that four-year-old audit, over a three-year period from 2006 to 2009, Oceanside Sanitary District Supervisor Charles Scarlata earned $667,163 in public pay and benefits, making him one of the most highly compensated public officials on Long Island.

The town audit also showed that Scarlata, 51, may receive a $25,000-a-year payment from Sanitary District 7 for 15 years after he leaves the district -- a deferred compensation package currently worth $299,530. Included in his pay package is a $450-a-year medical and optical allowance. Scarlata also receives the use of a district vehicle and five weeks vacation a year.

Scarlata is not the first member of his family to hold the top sanitary district job, the audit said. His father, Oceanside Republican club leader Michael Scarlata, held the post before him. And, the audit show, although Michael Scarlata retired from the district in December 1998 with an annual pension of about $75,000, he returned two days later as a part-time consultant for the district, making an additional $62,000 a year, plus health benefits. All told, the father and son cost sanitary district taxpayers more than $1 million in pay and benefits from the sanitary district from 2006 through 2008, the years examined by the audit, adding that district taxpayers pay $676 a year in garbage taxes, while the average in Hempstead Town is $420. The audit showed many other irregularities.

For example, a number of the district’s workers, the audit said, were working out of title. It found that workers who held civil service titles of “messenger” and “recycling worker” actually worked as an accountant, a secretary and a clerk. The employees were not tested for their positions, but were appointed by Michael Scarlata. The 2008 base salary for the accountant was $93,662; for the secretary, $96,662 and for the clerk, $88,404, which the audit said were much higher than the Nassau County salary range for those positions. In addition, it was found that the accountant did not have a bachelor’s degree from an accredited college or university, which is required by law.

The audit also found a lack of internal controls over cash disbursements, poor security over access to the fuel pumps ordinarily used to fuel district vehicles and a lack of competitive bids for goods and services.

Days after a damaging audit of Sanitary District 7 was released from the comptroller’s office, Scarlata, who was featured prominently in the audit as the receiver of an unusually high salary and unfair fringe benefits, was awarded a merit-based raise by the district’s Board of Commissioners.

Weitzman’s audit alleged dirty practices in the sanitary district and unfair treatment of workers, with Scarlata being the biggest recipient of favors. The audit alleged nepotism. Foe example, after the younger Scarlata was hired and replaced his father as supervisor, the elder Scarlata was hired as a consultant. The new supervisor was also granted two $300,000 life insurance policies—paid for by the sanitary district—and post-retirement pay of $25,000 a year for 15 years.

“The district made up its own rules for a small group of employees, while the majority of the laborers in the sanitary district had to play by the rules,” Weitzman said in the audit, adding that the salaries paid to those employees were higher than the typical range for the jobs they were performing.

Weitzman’s audit also claims the district did not seek proper approvals to use funds to fill a spending gap in 2006 — money he said could have been used to lower the tax rate. Sanitary District No. 7, which provides trash collection six days a week for more than 10,000 residents and more than 900 commercial businesses in Oceanside, is funded by taxpayers.

“Taxpayers have financed a million-dollar family,” he said.

The audit highlights the district’s extraordinary pay structure, which benefits select administrators, but pays far less to the people who actually pick up the garbage, Weitzman said.

For example, in 2008, Charles Scarlata was paid $224,569 to supervise roughly 55 employees. He was able to add $51,748 to his base salary of $146,245 by receiving payment for 92 comp days, which the audit said was for working extra hours. Additional benefits -- among them a $10,000 bonus, and health and dental insurance -- boosted his total compensation package for that year to $240,769, the audit said. By comparison, sanitation workers make from $17,000 to $79,550 a year, according to records. Moreover, district administrators are entitled to up to 800 days of termination pay -- or about 3½ years of salary -- when they leave. Laborers get up to 250 days, according to the audit. Because Charles Scarlata was the only employee whose payments for comp time were included in salary reports to the New York State retirement system, his pension upon retiring will be approximately $124,000 a year, auditors said.

Despite continuing to work as a district consultant, Michael Scarlata has no contract. Officials refused to provide auditors a written summary of his work, but said he fields requests from local community groups, responds to problems at schools and helps with labor negotiations, the audit said.

Nepotism is rampant, the audit said, with at least eight employees who appear to have family ties. “Sanitary District No. 7 has become the local family business on the public payroll,” Weitzman said.

Have things changed since the 2009 audit?

One woman with “close ties to the sanitary district” and who asked not to be identified because of a fear of retribution said this week, “not only have things not changed, but they have gotten worse.” She charged that workers have not received a new contract or raises in three years, while supervisors such as Scarlata continue to receive raises and that the union that represents the workers, Local 854 of the Teamsters Union, has done nothing to help the workers.

“Men who have worked for decades for the district and who work 28 to 35 hours a week earn $35,000 a year,” she said. “They get no breaks during the day and have to work in stifling hot trucks because the supervisors took the air conditioners out of the trucks to save money on fuel, while the supervisors all got new, air-conditions pick-up trucks. At the same time, Scarlata earns “a six-figure salary” and foreman earn nearly $100,000.”

After attempting for a week to speak with Jerome Cline, the district’s attorney, the Herald filed a freedom of information request seeking a copy of the district’s budget, a list of commissioners and copies of all consultant contracts that the district has with outsider, On Thursday, July 11, Cline did fax a two-page budget summary and the names of the five commissioners to the Herald. The sanitary district serves 13,000 households in Oceanside and small portions of Baldwin and East Rockaway. It also serves 950 commercial businesses and has an annual budget of about $8.65 million.

Sanitary Board members are paid $7,500 a year and receive medical benefits, according to Hempstead Town officials. The average homeowner pays about $600 in district taxes.