Opinion 89-18

This opinion represents the views of the Office of the State Comptroller at the time it was rendered. The opinion may no longer represent those views if, among other things, there have been subsequent court cases or statutory amendments that bear on the issues discussed in the opinion.

PUBLIC OFFICERS AND EMPLOYEES -- Conferences and Training Schools (wages lost from regular job while attending required basic course of assessors' training)
TOWN ASSESSOR -- Training (reimbursement for wages lost from regular job)
TOWNS -- Powers and Duties (authority to reimburse town assessor for wages lost from regular job while attending required basic course of assessors' training) -- (authority to recover unauthorized payments)

REAL PROPERTY TAX LAW, §§310, 318; STATE CONSTITUTION, ARTICLE VIII, §1: In the absence of express statutory authority, a town may not reimburse an appointed or elected assessor for wages lost from his or her regular job while attending courses of training required of assessors. A town is entitled to recover unauthorized payments made to an assessor as reimbursement for lost wages.

You ask whether a town may reimburse a town assessor for wages lost from his or her regular job while attending assessor training provided by the New York State Board of Equalization and Assessment. You indicate that the chairman of the board of assessors has, in fact, been reimbursed for lost wages in connection with his attendance at two training schools during 1987. Therefore, you also ask, if the payment by the town to the chairman was not authorized, what steps the town may take to recover the amount of payments made to the chairman of assessors in 1987.

Section 318 of the Real Property Tax Law requires that any person appointed or elected to the office of assessor be certified by the State Board of Equalization and Assessment ("State Board"). Generally, in order to be certified, an assessor must successfully complete the basic course of training and such examinations as are prescribed by the State Board. In addition to the basic course of training and education, all appointed assessors must complete additional courses in a continuing training and education program prescribed by the State Board (see Real Property Tax Law, §310[5][b]).

Subdivision 4 of section 318 provides that:

Notwithstanding the provisions of this subdivision or any other law, the travel and other actual and necessary expenses incurred by an appointed or elected assessor, or by an assessor-elect prior to the commencement of this term, in satisfactorily completing courses of training as required by this title or as approved by the state board shall be a state charge upon audit by the comptroller. Travel and other actual and necessary expenses incurred by an acting assessor who has been exercising the powers and duties of the assessor for a period of at least six months, in attending training courses no earlier than twelve months prior to the date when courses of training and education are required, shall also be a state charge upon audit by the comptroller. Candidates for certification as eligible for the position of assessor, other than assessors or assessors-elect, shall be charged for the cost of training materials and shall be responsible for all other costs incurred by them in connection with such training.

Under this section, an appointed or elected assessor or an assessor-elect is entitled to reimbursement from the State for his or her travel and other actual and necessary expenses incurred in attending training courses. Nowhere within the provisions of Real Property Tax Law, §318, however, do we find authority for the town to reimburse assessors for wages lost from their regular jobs (cf. General Municipal Law, §72-o, added by chapter 456 of the Laws of 1988, providing for reimbursement by municipal corporations and fire districts to volunteer firefighters for certain expenses, including actual lost wages up to a maximum of $100, incurred in connection with appearances before a court or other tribunal under certain circumstances).

Further, although Town Law, §116(1) authorizes a town to pay all actual and necessary expenses of town officers and employees when incurred by authority of the town board, that statute, in our opinion, does not permit reimbursement for lost wages. This Office, in interpreting Uniform Justice Court Act, §105, which provides for the reimbursement by a town or village of actual and necessary expenses incurred by a town or village justice in attending a mandatory course of education and training prescribed by the Administrative Board of the Judicial Conference, concluded that lost wages from private employment while attending the course were not in the nature of out-of-pocket actual and necessary expenses that could be reimbursed by the municipality. It was our opinion that the fact that the school was mandatory did not change the nature of the expense (1973 Opns St Comp No.73-1050, unreported). We believe that this conclusion equally applies to wages lost while attending assessor training.

With respect to whether a town may pay for the lost wages under its home rule authority, we note that Municipal Home Rule Law, §10(1)(ii)(a)(1) authorizes towns to adopt local laws, not inconsistent with the constitution or a general law, relating to the welfare of its officers and employees. A town is also authorized to supersede any provision of the Town Law, with certain exceptions, relating to its property affairs or government or other matters in relation to which and to the extent to which it is authorized to adopt local laws (Municipal Home Rule Law, §10[1][ii][d][3]). Among the exceptions contained in section 10(1)(ii)(d)(3), however, is one which precludes a town from superseding the provisions of Article 8 of the Town Law, which relates to town finances and which includes Town Law, §116. Further, Real Property Tax Law, §330 expressly states that no local law shall be inconsistent with title 2 of that law (§§308-326).

As noted, lost wages from private employment is not, in our opinion, an actual and necessary expense within the meaning of Real Property Tax Law, §318 and Town Law, §116. Consequently, it is our opinion that any local law permitting such reimbursement would violate the limitations contained in section 330 of the Real Property Tax Law and section 10 (1)(ii)(d)(3) of the Municipal Home Rule Law insofar as they preclude towns from adopting local laws inconsistent with Town Law, §116 and Real Property Tax Law, §318. Therefore, in our opinion, a town may not adopt a local law providing for payment, as an actual and necessary expense, for wages lost from a regular job while attending the training session.

Having concluded that the reimbursement made to the chairman was unauthorized, and we must address the question of recovering the payments already made to the chairman of assessors. We assume for this purpose that neither the fact of the payment nor the amount thereof is in dispute.

It is well-established that payments of salary which have been made by a municipality in excess of the amounts which the municipality is legally obligated to pay would constitute payment for services which were not rendered and, if the employees were permitted to retain such moneys, it would be a gift of public moneys in violation of Article VIII, §1 of the State Constitution (Mullane v McKenzie, 269 NY 369; Boyd v Collins, 11 NY2d 228, 228 NYS2d 228; Mount Vernon v SBEA, 92 AD2d 985, 461 NYS2d 493; 1983 Opns St Comp No. 83-161, p 203; 1980 Opns St Comp No. 80-752, p 207). We believe that the same analysis would apply to the unauthorized payments to the chairman of assessors.

With respect to the procedure for recovering the payments made in 1987, we believe the town should first give the chairman the opportunity to voluntarily repay the amount of the unauthorized payment. Such a repayment may be made all at once or upon other terms as may be agreed to be the town and the officer (Opn No. 83-161, supra). We note, in this regard, however, that the ability of the officer to agree to repayment through deductions from salary may be limited, to some extent, by public policy considerations (Feinberg v Board of Education, 74 Misc 3d 371, 344 NYS2d 618, affd 51 AD2d 548, 378 NYS2d 426).

In Feinberg v Board of Education, supra, a school district withheld the total compensation earned by a substitute teacher for 30 days employment, as recoupment of alleged overpayments mistakenly made in the form of vacation pay to which the teacher was not entitled. In denying a motion to dismiss for failure to state a cause of action, the court, citing statutes which place limits on the amounts of wage executions and voluntary wage assignments, discerned a public policy of protecting an employee against his own improvidence and preserving the means for his daily existence. The court indicated that the employee must be allowed some tolerance for his minimal needs, while being given an opportunity to work off his debt. Although Feinberg, supra, involved an involuntary recoupment, in light of the public policy concerns discussed in that case, it appears that an officer or employee, in certain circumstances, may be precluded from agreeing to forego his entire salary, or any large portion thereof, in order to re-pay the amount of the unauthorized payments.

If the officer fails to repay the amount voluntarily, it is our opinion that the town, subject to due process considerations, may undertake to recover the amount of the payments. In Salling v Koch, 115 Misc 2d 514, 454 NYS2d 416, the City of New York recovered salary over-payments by deducting $25.00 per paycheck from the employees involved. Although no hearing was held, the City had notified the employees explaining the mistake, indicating that their wages would be reduced by a specified amount and stating the exact amount of the alleged overpayment. An action was commenced alleging due process violations. The court held that, under these circumstances, a pre-deprivation hearing would have been unduly burdensome on the City, stating as follows:

... The factors to be considered are: (1) the private interest to be affected by the government's action; (2) the risk of erroneous deprivation of such interest, and the value of any substitute safeguards; and (3) the government's interest, the functions sought to be accomplished, and any fiscal or administrative burdens that additional safeguards may entail. * * * Resolution of the issue involves neither the credibility of witnesses, nor complex factual determinations. The issue is simply whether the government has erred in calculating the salary of the petitioners according to clear standards readily available to all interested parties. It can be accurately determined, without the need for a full, impartial hearing, if the government has mistakenly overpaid an employee. A hearing would be unduly burdensome on the government in comparison with the benefit, if any, that it would provide to the employee.

On balance, I hold that the respondent has fulfilled its obligation pursuant to the due process clause of providing notice to and an explanation of the error it made, and its plans to rectify such mistakes. Due process does not require more. (115 Misc 2d 515-516, 454 NYS2d 418-419)

Based on the foregoing, it is clear that whether a hearing is required prior to recouping over-payments in a given instance depends upon the particular facts and circumstances of the overpayment. We believe that here, as in Salling, supra, notification to the chairman would be sufficient because of the town's lack of authority to make the initial payment and because the amount overpaid are clearly established.

After notification, the town may exercise its common law right of setoff and deduct the amount of the payments from any amount due from the town to the officer as salary (1988 Opns St Comp No. 88-42, p 83; Opn No. 83-161, supra; Opn No. 80-752, supra). As noted above, however, there are certain limits on the amounts of salary that may be withheld from the officer based on public policy considerations. While a municipality may have a right or even an obligation to recoup overpayments, "...governmental agencies have a duty to refrain from acts that are illegal, arbitrary or capricious when attempting to recoup monies mistakenly paid to its employees" (Salling, supra, 115 Misc 2d 514, 515, 454 NYS2d 416, 418). Consequently, it may be advisable for the town, if it chooses to exercise its right of setoff, to limit the amount of that setoff to the amount permitted for a wage execution or a voluntary assignment of wages (see Civil Practice Law and Rules, §5231; Personal Property Law, §48-a).

In the alternative, the town may institute a civil action to recover the amount of the unauthorized payments. If the town obtains a money judgment, it may be enforced in the manner provided by Article 52 of the Civil Practice Law and Rules.

May 3, 1989
Robert E. Buzzell, Supervisor
Town of Plainfield