More 1970s Flashbacks
All this being said, the largest waste of taxpayer money comes from the way the Town of Hempstead has handled workman’s compensation for over 45 years.
At a board meeting on Jan. 4, 1972, Nicholas DeSibio was appointed to handle the processing of claims under the town’s self-insured Workers Compensation program.
In 1982, Claims Service Bureau was chosen to be the town’s third-party administrator. When Laura Gillen took office, her staff was shocked to learn Mr. DeSibio and Claims Service Bureau were still processing and administering claims using paper files — they never created a computer database.
Immediately, several of Supervisor Gillen’s staff looked to bring Workers Compensation claims processing to present-day standards by bringing in new firms. Sadly, just like other initiatives to make improvements, this proposal was also rebuffed for months.
Similarly, the town’s systems for electronic medical billing, claims processing and risk management were woefully outdated.
To address this, a bipartisan review committee was established to go over proposals that would update the town’s systems. The systems were so outdated, the firms who pitched us believed the town could save over $4 million annually.
However, after lengthy delays by the town attorney’s office, only half the proposal was initiated. While approximately $2 million will be saved annually going forward, it could have been $4 million.
One of the vendors that won the bid, Brady Risk Management, was never approved because the town attorney’s office couldn’t come to terms on the price of Brady’s proposal. As of now, the risk management piece of the town’s Workers Compensation is still being done using disco-era processes, at an additional cost of around $2 million per year to the taxpayers.
You’re Not in Good Hands with the Town of Hempstead
On the topic of insurance, the Town hadn’t had its property coverages reviewed in at least 10 years (nobody really knows how long for sure).
Marsh, a nationally known insurance broker working on behalf of the town, regularly received only one bid at the annual renewal, at a commission rate almost twice the industry standard.
As it turns out, Marsh was only able to procure one bid, because the town hadn’t had its property values appraised in years, and few insurance companies wanted to bid without knowing specific property values.
I initiated a request for proposal to see if we could get a lower commission charge on all the town’s insurance coverages.
However, the review committee, stocked with a majority of Republicans to sway any vote, chose the most expensive respondent, who just happened to be Marsh again.
Marsh offered to do the same work at roughly a $50,000 drop in commission. I worked with Marsh to try and seek more competitive bidding for town policies, and, truth be told, they were a pleasure to work with, responding quickly to any questions they received. This was a rarity during my tenure at the Town.
July 1, 2019 was the day of the annual renewal of the town’s insurance coverage. Marsh was unable to procure additional quotes because the town attorney’s office hadn’t signed off on Marsh’s new contract—which included getting appraisals of the ten largest Town properties.
Five months later: Marsh still hadn’t been paid their fee; they still didn’t have a contract, and they still couldn’t procure more than one quote. I have called, emailed and visited the town attorney’s office a dozen times over these five months, and there has never seemed to be any sense of urgency to move forward on Marsh’s contract, even though they had already done work in good faith.
Grave Malfeasance
The Town of Hempstead is almost unique in New York State in that it owns and operates a cemetery, the 158-acre Greenfield Cemetery, in Uniondale.
In November 2009, Newsday reported a mom discovered her son was buried in the wrong grave. To prevent this from ever happening again, the town vowed to stop using paper records, and to hire cemetery consultants, David Jacobson and Arthur S. Friedman, who operated under an LLC called “Greenfield Cemetery Consultants.”
I am not sure what Greenfield Cemetery did for their $104,000 a year fee, because when I reached out to the town’s cemetery office there were no records of their work.
In fact, Arthur S. Friedman was banned from working in the cemetery business for life in New York State a few years after Friedman’s Greenfield Cemetery Consultants started working for the town.
He and his wife were convicted of theft from the United Hebrew Cemetery in Staten Island and forced repay over $1.1 million. There is an overlapping of time when Mr. Friedman was banned for life from the cemetery business and when Greenfield Cemetery Consultants received their fees as on-call consultants.
It’s not clear if Mr. Friedman received payment from the Town through his LLC after he was banned by New York State.
With Supervisor Gillen’s blessing, I put the Cemetery Consultant RFP out to bid and the review committee led by a Republican Town Board staff team chose a submission from Mr. Jacobson, a Republican donor and former partner of Mr. Friedman.
When I brought Friedman’s association to Mr. Jacobson (they are related) to the review committee, the town stopped the review process and never let the contract come up for a vote.
To date, the cemetery hasn’t procured a new consultant to upgrade the inefficient operations of its outdated facility.
Adam Haber is the former deputy chief of staff of Economic Development and Government Efficiency, Town of Hempstead
