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Control board can assert more authority Judge dismisses lawsuit filed by county officials

A judge has agreed that Erie County's state-appointed control board has the authority to assert more control over county finances, as it now is doing.

State Supreme Court Justice Diane Devlin dismissed the lawsuit county officials filed in November when the Erie County Fiscal Stability Authority -- as the control board is formally known -- first insisted it review county hiring and contracts worth more than $50,000.

"The authority did not act prematurely or arbitrarily," Devlin wrote in an eight-page decision she signed Friday and made public Monday. She said the control board did not need to wait until the government's budget-adoption process played out before transforming into a so-called hard board able to override elected leaders on certain decisions.

The control board's lawyers had argued that the six appointees -- seven when the board is at full strength -- have the power and obligation to impose a "control period" if they see county revenues failing to meet expenses. The State Legislature created the Fiscal Stability Authority in 2005 to help the county emerge from its latest financial crisis.

Devlin agreed that even though the 2007 budget had not yet been adopted back in November, the control board is right to expect a balanced four-year financial plan and it was free to act when it deemed County Executive Joel A. Giambra's four-year plan out of balance.

Control board Chairman Anthony Baynes said he met the Devlin decision with hope that his panel can now work more closely with "the county executive, the comptroller and the Legislature to help county government further pursue fiscal recovery."

But Erie County Attorney Laurence K. Rubin, who filed the legal challenge with the help of the law firm Hurwitz & Fine, said an early review of the decision indicates "an appeal is appropriate."

Giambra and his lead gladiator with the control board, Budget Director James M. Hartman, were in Albany on Monday for a State Association of Counties conference, and they let Rubin speak for the administration.

The county's two largest public employee unions also had joined Giambra in the lawsuit, but in December they were told they had no legal standing. The control board had never frozen wages or affected the unions' terms of employment.

Control board lawyers also had argued that the county's lawsuit became moot when the control board in January reinforced its November action. The members stated Jan. 11 that even the revised four-year plan and the adopted budget did not balance, so they would remain a hard control board through most of the year.

Giambra officials and some legislators were frustrated after that January vote. To them, it seemed no matter what they did, the state appointees were determined to be a hard board. The elected officials and their aides felt they were being held to a standard that no government can meet, since any budget can slip out of balance during its life.

Last week, County Comptroller Mark C. Poloncarz, a Democrat occasionally critical of Giambra, argued that the 2007 budget balances far better than the control board indicates and said any potential deficit amounts to less than 1 percent of a $1.4 billion budget. Poloncarz urged the board to tone down its rhetoric.

Outside public view, steps to mend fences have begun. Sources inside the government say Giambra and Baynes recently sat down for lunch together in the latest quest for harmony. The control board also is broaching an idea to refinance county debt in the hopes of saving millions of dollars in interest payments.


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