Last October a three-member arbitration panel ruled 2 to 1 that the city must provide a retroactive, 2 percent salary increase for all members of the Jamestown Kendall Club PBA for the years covering 2016 and 2017.
In November the Jamestown City Council voted 7 to 1 in favor of challenging that decision. State law requires an arbitration decision involving the police union to place a weighting factor of 70 percent toward the ability of a fiscally challenged municipality like Jamestown to pay. In challenging the arbitration process, the city council felt it would be a violation of its fiduciary duty to comply the arbitration award, basing its argument on the award being in violation of the 70 percent state statute. The city’s legal argument was that the arbitration decision was “arbitrary and capricious.”
On Monday, March 18, Hon. James H. Dillon ruled from the bench to deny the city’s motion to set aside the arbitration decision. The ruling came immediately after oral arguments were made by the attorneys representing the two sides. The Kendall Club was represented by attorney Charles De Angelo, from Fessenden, Laumer & De Angelo while the city was represented by attorney Terry O’Neil from Bond, Schoeneck & King.
Based on a court transcript made public this week, Justice Dillon said he felt that the 70-percent weighting factor statue was terrible,but also said it was still the law and he felt the arbitrators did follow it as required.
“This [arbitration] decision does indicate that the arbitrators took into account the 70 percent criteria, which is really a terrible statue but the legislature doesn’t care, nor does the Appellate Division care about my thought of that. Because frankly, my thought of that as a lawyer, exactly how do I present this and what do I expect from a judge on 70 percent as opposed to seventy-one, et cetera. But nonetheless, it is the law. But I think they took that into account,” Dillon explained.
Justice Dillon also said that there was evidence supported by all three arbitrators showing the statute was accounted for in the 2-1 split decision.
“I think you can see they took it into account not only in the majority opinion, but in the concurring and the minority opinion, which definitely mention it. So I can’t say — obviously, that it was considered. Otherwise you’d have nothing to dissent to… I think mathematically you can compute the cost of the arbitration from the information that I have received. So I think it’s there enough. I will at this point in time deny the motion to set aside the arbitration, confirm the arbitration, note your exceptions for the reasons you have well ably stated,” Justice Dillon explained to the attorneys on hand.
Following this week’s City Council Voting session, we asked Jamestown Mayor Sam Teresi his thoughts on the case now that the ruling had been made public.
“We were disappointed to a certain extent but, quite frankly, it’s not unusual that a lower court level like this, that they would just turn it over to the appeals court and allow the parties to deal with it before a five-member appellate division panel,” Teresi said. “On the one hand we were disappointed but on the other hand it wasn’t something that was completely shocking to us. Now its a matter for the city council and I, and our legal team, to determine what steps we may want to take next towards an appeal.”
The city spent $25,000 to challenge the arbitration and if it were to appeal Justice Dillon’s ruling, the matter would then proceed to the 4th Appellate Division in Rochester, likely costing the city more money. However, Mayor Teresi notes that if the city were to accept the decision, it will have a major financial impact moving forward.
“To allow that decision to stand will have an $840,000 unbudgeted impact on the 2019 budget. And that impact is only for retroactive raises for 2016 and 2017. If that decision is allowed to stand, it could lay the groundwork for a similar retroactive payment with the fire union moving forward. And as well that $840,000 impact for the police union alone doesn’t take into account raises that might be received for 2018, 2019, and 2020 moving forward,” Teresi explained.
While Judge Dillon made his decision from the bench, he still provided a formal, written decision and sent it to both parties. Once that is done, the city will have 30 days to decide if it wants to accept the arbitration panel’s decision or appeal to the higher court in Rochester.
As WRFA reported in February, a similar scenario also played out recently with the city of Plattsburgh, NY and its fire union. There, the city challenged an arbitration ruling, arguing it failed to follow the 70-percent statue. A Supreme Court upheld the arbitration ruling and it was eventually appealed by the city to the state appellate division, which also eventually upheld the lower court’s decision.