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State fund’s refusal to reimburse Amherst is a 10-year disgrace

The situation that has the Town of Amherst struggling to get the State Insurance Fund to pay what it ought to has gone from the ridiculous to the intolerable.

It’s not like the state insurance agency doesn’t have the funds. The main point is that that is where the money should come from, not from the taxpayers.

Amherst has spent years grappling with the state agency for reimbursement on a multimillion-dollar judgment the town paid to the victim of a roofing accident who was left partially paralyzed just over 10 years ago.

In an interesting twist that was recently reported, the Rochester Appellate Division of State Supreme Court denied the town’s latest attempt to recover more than $30 million in principal and interest costs from the fund.

But, in a rare signed decision, Judge Eugene Fahey stated, “Our inquiry, however, does not end at this juncture.” The judges dedicated 30 lines of explicit legal instruction on how the town should compel the state insurance agency to pay the town the money it’s owed.

That should give more than a slight hint as to how far this case has gone and how much – and how egregiously – town taxpayers have been burdened.

The tragic circumstances leading up to the 2002 accident in which a contractor fell from the roof of a building at a state park and broke his neck is extremely unfortunate. But the way in which the State Insurance Fund has worked to avoid digging into its own healthy piggy bank is awful.

The town paid $23.4 million to the injured worker because the town was maintaining the property. Town officials did what they should have done. But then they spent more than five years trying to secure reimbursement from the state insurance agency.

As Amherst Supervisor Barry Weinstein told a News reporter, the town has spent about a half-million dollars in legal fees and bond costs related to this case, known as the Bissell case. Peter E. Bissell of Sanborn worked for the now-defunct McGonigle and Hilger Roofing Co. of Lockport and the town contracted with this company to check for a roof leak at St. Mary of the Angels Motherhouse in Amherst State Park.

Even though it is a state park, an agreement holds the town responsible for maintenance of buildings in the park. The company sent Bissell to the job and he fell from a ladder during inspection and broke his neck, leaving him partially paralyzed in both legs but still able to feel extreme pain in his limbs.

It is a sad story with many legal consequences, involving lawsuits and appeals by all parties. Bissell’s initial $30.3 million jury award in State Supreme Court in 2007 was reduced to $18.3 million the next year, but accumulating interest has required the town to pay the family the $23.4 million.

The town’s insurance carrier covered $10 million of the judgment, but the town then borrowed $13.4 million and two years ago began repaying the money by borrowing money from its own reserves at $3.2 million a year.

The huge burden on town finances should have been unnecessary. But the State Insurance Fund has been so loathe to reimburse the money that it went so far as to actually pay for a lawyer to represent the roofing company.

The Appellate Division and the unprecedented nature of Fahey’s signed decision should serve as signal enough that the town is on the right track. And that the State Insurance Fund is plain wrong. Someone needs to tell it so.