Flood control exec’s payout criticized
The former chief financial officer of a state flood control district improperly received a payout of $51,083 when he retired in 2019, the state Inspector General’s office said Thursday.
Richard Ferrara started work at the Hudson River-black River Regulating District in April 2005. But he initially was there as a temporary employee, not getting on the payroll until October 2005. In July of that year, the district dropped its policy of granting retirement payouts for unused sick time and free retirement health insurance coverage, meaning that Ferrara was ineligible for the benefits.
But he got a payout anyway in 2019, according to Inspector General Letizia Taliaferro, who said the case was referred to the state Comptroller’s Office.
According to IG’S office, their investigation found Ferrara repeatedly and unsuccessfully petitioned
the district’s board and several executive directors to change the rules so he could get the sick leave accruals and make no payments to health care insurance premiums following retirement. Still, Ferrara was erroneously paid the $51,083 in October 2019 by the district for his sick leave accruals to which he was not entitled, the watchdog agency said.
“Ferrara — who served as CFO of the District for more than 14 years and should have been aware that his payout was not permitted — did not notify HRBRRD of the error or return the improper disbursement,” an IG statement said Thursday. Ferrara also declined to cooperate with the IG’S investigation, it said.
Ferrara’s annual salary at the time of his retirement was $132,812.
Regulating District Executive Director John Callaghan said the district became aware of the payout and brought it to the IG office’s attention just after Ferrara left in 2019.
“We will certainly recoup those funds,” Callaghan said. “The regulating district immediately referred the matter to the inspector general after identifying this discrepancy,” he added in an email.
The IG found the payout was calculated in error by a senior administrative assistant under the mistaken belief that Ferrara had been an actual employee and not a contractor, in April 2005.
“The former CFO’S actions in failing to acknowledge the wrongful payout, compounded by deficient checks and balances within the District, are troubling,” Tagliafierro stated. “Our investigation found that a series of missteps led to this payout and outlined recommendations to ensure the District can continue its mission while adhering to fiscally responsible practices.”
Callaghan said the district has improved its financial oversight following the IG’S probe and a 2020 audit.
As a public benefit corporation or public authority, the district’s approximately $7 million budget comes from flood control assessments to counties where it operates and fees from hydroelectric dam owners on the rivers, as well as waterfront fees.
The district maintains reservoirs, including Great Sacandaga Lake, and regulates water flow in two watersheds starting in the Adirondacks: the Upper Hudson River and the 125-mile Black River. It prevents flooding during times of high water.