New York has a new limit on the severance pay that state authorities can pay out. It's designed to prohibit the type of golden parachute that a former director of the Erie County Water Authority arranged in 2018.
After Democrats seized control of the Erie County Legislature, meaning they would soon control the Water Authority, Republican appointee Earl L. Jann Jr. signed a three-year pact ensuring him a salary of around $150,000 a year.
With the contract, signed in January 2018, Jann could have collected the remaining balance on the three-year term if a new Democratic majority on the Water Authority board fired him without cause. Jann could have collected $300,000 to $400,000 if fired in the first year.
After The Buffalo News published articles about the contract, Assembly Member Monica P. Wallace, D-Lancaster, introduced a bill to limit the golden parachutes that state authorities could pay to an "at-will" employee, or one who can be fired at any time. Her Severance Pay Limitation Act, approved by both houses and recently signed by the governor, limits severance for at-will appointees to no more than 12 weeks’ pay.
“When the Erie County Water Authority voted to give a ‘golden parachute’ contract to its then-executive director, I was disgusted by this waste of scarce public dollars," Wallace said in a statement Monday announcing that Gov. Andrew M. Cuomo had signed the bill. "Monies paid to The Erie County Water Authority should be spent addressing our crumbling infrastructure and improving our water quality, not providing lucrative severance packages to its executives."
Jann ended up being dismissed in June 2018 on a technicality – without his severance package. Democratic appointees to the Water Authority's board determined that in most cases, an executive director cannot be granted an employment contract that extends beyond one year because past boards cannot bind the hands of future boards on governance matters.
In September, Jann defended his record as the Water Authority's executive director and said he was qualified for the job.
"Both as a commissioner and executive director, I initiated numerous changes that have had a positive effect," he said in a letter published in The News.
"It is one thing to claim my contract was void," he continued. "It is another to terminate my employment with no reason given. Just because I have been a supporter of the Republican Party, like my successor, doesn’t make me unqualified."
The Water Authority's current executive director is Russell J. Stoll, who had been the organization's executive engineer. He was elevated to his new post in September, with a salary of $175,000 a year. He does not have an employment contract.