2013-05-20~ ~ STENGER ROBERTS
DAVIS & DIAMOND ~~p
1136 Route 9
Wappingers Falls, New York 12590
(845) 298-2000
FAX (845) 298-2842
www.srddlaw.com
e-mail: info@srddlaw.com
Kenneth M. Stenger May 13, 2013
Albert P. Roberts
Thomas R. Davis Sedore Hudson Valley C.P.A.'s
2678 South Road, Suite 1
Stephen E. Diamond' Poughkeepsie, New York 12601
Joan F. Garrett Attention: Ms. Linda Hannigan
MAY202~i3
TOUV~9 ~~ ~t~A~~~GE~Z
Re: Town of Wappinger
Kevin T. Mcoem,ott pending or Threatened Litigation
Angel I. Falcon File No.: 12951.0060
James P. Horan'""
Dear Ms. Hannigan:
Lisa M. Cobb
' Pursuant to the letter request dated April 1, 2013, from Barbara A.
Sullivan
M. Ellen O Gutzler, Supervisor of the Town of Wappinger, the following is the status
Marina O'Neill of material Pending or Threatened Litigation, Claims and Assessments
Melissa A. Manna-Williams against the Town of Wappinger, as known to the best of my knowledge
through May 1, 2013.
OF COUNSEL PENDING OR THREATENED LITIGATION
Scott L. Volkman ~Excludinsr Unasserted Claims anal Assessmentsl:
Karen MacNish
I hereby report that as of the date of this letter, to the best of my
knowledge, the only material Pending or Threatened Litigation matters in
PARALEGALS which the Town of Wappinger is or maybe named as a pazty aze listed in
Sandra Oakley this letter below. With respect to Tort actions, please be advised that there
Dawn M. Paino are several claims pending against the Town which are being defended by
the Town's insurance carriers. I am unawaze of the exact number, nature,
CLOSING COORDINATOR status or probability of success with respect to any of these actions except
Maria L. Jones as noted below.
Please be further advised that the Town's Tax Certiorari proceedings are
ALSO ADMITTED IN FL b MA
SD ADMITTEDwcT
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presently handled by Scott L. Volkman, Esq., who, during Galen az year
AL
'^ ALSO ADMTTED IN NJ 2012, was associated with the firm of Gellert & Klein with offices at
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May 13, 2013
Ms. Linda Hannigan
75 Washington Street, Poughkeepsie, New York 12601. Mr. Volkman is presently
associated with my firm on an "Of Counsel" basis. Mr. Volkman will be submitting a
separate opinion regarding same.
PETNY Deficiency
The Town was previously a member of PETNY, a Self Insurance Trust for Workers'
Compensation consisting of several municipal subdivisions. In consequence of what
appeared to be significant deficiencies in the funding of PETNY, the Workers' Comp
Board determined PETNY to be insolvent and assumed the responsibility for the
administration of the Trust. The Workers' Comp Board hired an independent accounting
firm to conduct an audit of the books and records of PETNY and to calculate the
estimated deficiencies due by each municipality. The auditor, Lumsden & McCormick,
LLP, originally determined the estimated deficiencies to be $7,557,515.00 and
determined that the Town of Wappinger's share of said deficiencies was $283,752.78.
The Town, along with several of the other municipalities involved in PETNY, vigorously
opposed the payment of the sum but, pending settlement negotiations, entered into an
interim Tolling Agreement by which the applicable statute of limitations would be tolled
pending negotiation of the amounts due. In consequence of the vigorous opposition posed
by the Town and the other municipalities, the Workers' Comp Board recalculated the
alleged amounts due and determined that the Town of Wappinger was now due a refund
of approximately $15,336.33. The Workers' Comp Boazd has offered the Town a
settlement proposal in which it will give the Town of Wappinger and any other similazly
situated municipalities a priority in the reimbursement due them when, as and if
additional funds become available to PETNY. The additional funds will appazently be the
result of on going settlement negotiations with certain members of the PETNY Trust as
well as with outside parties. At present, there appears to be no further risk of liability for
the Town for any further payments.
UNASSERTED CLAIMS AND ASSESSMENTS .
This letter includes matters that existed as of December 31, 2012, and, further, through
May 1, 2013.
The undersigned knows of no other unasserted claims or assessments considered to be
probable of assertion and/ or if asserted, would have a possibility of an unfavorable
material outcome. However, in the course of performing legal duties for the Town of
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May 13, 2013
Ms. Linda Hannigan
Wappinger with respect to a matter recognized to involve an unasserted possible claim or
assessment that may call for financial statement disclosure, and I have formed a
professional conclusion that the Town should disclose or consider disclosure concerning
such possible claim or assessment, as a matter of professional responsibility to the Town
of Wappinger, I will so advise the Town and will consult with the Town concerning the
question of such disclosure and the applicable requirements of Statement of Financial
Accounting Standards No. 5.
There are no other potential liabilities or loss contingencies that are required to be
disclosed or accrued in the financial statements, other than the abovementioned matters.
There are no other potential liabilities or loss contingencies which in my professional
judgment are required to be disclosed or accrued in the financial statements. All
contingent liabilities set forth above are as of the date of this correspondence.
The scope of this letter includes litigation commenced against the Town to present,
except as noted above. To the best of the knowledge of the undersigned, there are no
actions that have been commenced against the Town, or threatened to be commenced
against the Town, nor are there any actions pending which would subject the Town to any
monetary payment or financial loss, except as above stated.
OTHER MATTERS
The amount that the Town of Wappinger was indebted to my firm for services and
expenses as of December 31, 2012 was $37,649.00.
The undersigned knows of no other unasserted claims or assessments considered to be
probable.
Very truly yours,
STENGER, ROBERTS, DAVIS & DIAMOND, LLP
ALBS P. OBERTS
APR/so
cc: Hon. Barbara A. Gutzler, Supervisor
Hon. Christine Fulton, Town Clerk
Scott L. Volkman, Esq.
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