A former federal prosecutor who is representing the city amid an investigation into its payout practices criticized Nassau County District Attorney Madeline Singas after she initially slammed the city in a letter Thursday that appeared to suggest it was not cooperating in an investigation.
Anthony Capozzolo, an attorney with Lewis Baach Kaufmann Middlemiss PLLC, who was hired the by the city last year to serve as outside legal counsel, said in a letter to Singas that it was inappropriate to express her opinions on a draft audit of the city’s finances and payouts — provided to the city on Thursday by State Comptroller Tom DiNapoli’s office — because the audit is not yet final. He also said that the city has fully cooperated with Singas's investigation.
In a letter responding to Capozzolo on Friday, Chief Assistant District Attorney Albert J. Teichman, clarified some of Singas's remarks.
"Our generic reference to uncooperative witnesses that have delayed our
investigation was not intended to suggest that your clients have been uncooperative," Teichman said.
"We appreciate the district attorney’s office’s important clarification of their letter from yesterday, which now makes clear that the city has been cooperative throughout their investigation," the city's assistant corporation counsel, Greg Kalnitsky, said in a statement to the Herald. "The city will continue its cooperation, and we will have no further comment.”
Neither the city nor the comptroller’s office has provided the Herald with a copy of the audit.
“One purpose of the comptroller providing a draft report ... is to provide the city with the ability to be heard and respond to the report, so that when it is made final — public — it might better reflect a complete picture of what occurred,” Capozzolo wrote. “Doing otherwise would deprive the city of its due process before the comptroller's office and fundamental notions of fairness.”
Singas, whose office has been investigating whether payments made to certain current and former Long Beach officials and employees for accrued sick leave and vacation time were proper since April 2018, said her office has collaborated with DiNapoli’s office throughout the criminal investigation.
“Having reviewed the records obtained by the comptroller and the auditors’ findings and recommendations, it is clear that the city’s policies and procedures are inadequate, that current and former city officials failed to comply with the plain language of the City Code and former city manager’s contract, and the City Council has not adequately exercised its oversight authority,” Singas wrote in a letter to the City Council and Acting City Manager Rob Agostisi.
Singas also said that she hoped the comptroller’s "determination that payments were made in excess of the limits established in the City Code and the former city manager’s contract moves the city not only to take the recommended remedial actions immediately — including seeking repayment to the city for any inappropriate disbursements and implementing reforms detailed in this and earlier audits — but to cooperate fully and expeditiously with our criminal investigation as we seek to conclude it.”
Singas added that her investigation had “been delayed by a lack of cooperation by some critical witnesses and the unavailability of certain records that may be material to our review.” She did not identify any individual current or former employees, or specify which documents she has not been able to obtain.
Teichman said that Singas’s letter was a response to City Council President Anissa Moore’s remarks at an Aug. 20 meeting, at which Moore "raised questions as to the alignment of interests between parties you represent as outside counsel to the city, and to remind the recipients of their right to seek their own counsel if they choose."
Amid calls from council members, County Legislator Denise Ford and "hundreds" of residents to release the findings of the investigation, "the district attorney chose to provide our independent assessment of that limited body of information and the comptroller’s findings and recommendations," Teichman wrote. "The [district] attorney’s letter did not detail any findings of our independent investigation, which as you know, remains ongoing."
Investigations began more than a year ago
Both Singas’s and DiNapoli’s offices have been conducting reviews of the city’s payouts after the council rejected a $2.1 million borrowing measure last year to cover payouts in the 2017-18 fiscal year to 57 union and non-union employees — including a number of payments to employees who remained on the payroll, and a $108,000 payment to then City Manager Jack Schnirman, who is now the county comptroller.
Schnirman — who was appointed city manager in 2012 when the Democrats regained control of City Hall — received a payout amounting to at least 100 percent of his accrued sick days when he left the city’s employ in January 2018, even though the city’s Code of Ordinances states that non-union, or management, employees like Schnirman should be paid 30 percent of total accrued sick days at the time of separation. Schnirman’s employment contract also specified that he should be paid 30 percent.
City officials have maintained that the city manager has discretion over the code, based on a legal interpretation that dates back to 1997.
In his letter to Singas, obtained by the Herald, Capozzolo wrote that the city had offered retirement incentives to both union and non-union employees, which provided more than the 30 percent sick leave entitlement outlined in the City Code and Civil Service Employees Association contract.
“In fact, these incentives, on one occasion, were expressly approved by the City Council without amending any city ordinances or contracts,” Capozzolo wrote. “The other two incentives were offered to union and exempt employees without any City Council approval, but were well known to the City Council. These facts strongly support a position that permitting a payment of accrued sick leave in excess of 30 percent was fully authorized. Thus, your comments on the draft comptroller report do not take into account a complete version of facts.”
Capozzolo — a former assistant U.S. attorney with the U.S. attorney’s office for the Eastern District of New York — also said that “at all times,” he made “each and every witness” available to Singas’s office and provided “thousands” of pages of relevant documents during the investigation, and that the city has cooperated fully with the probe.
“To the extent that I accompanied city employees as counsel in any meeting with your office, there is not a single witness you have not been able to interview in a timely fashion,” Copozzolo said, “and further, your office has never objected to such procedure.”
In her letter to the city, Singas, a Democrat who is up for re-election this year, said that because the probe is ongoing, her office typically does not comment on the status of ongoing investigations.
“In many cases, grand jury secrecy obligations legally prohibit the disclosure of investigative content by prosecutors,” she wrote. “Though we concur with the findings of the comptroller’s audit, we have not yet made any determination as to whether crimes occurred. We will make that determination as quickly as possible.”