The opinion of the court was delivered by: Spatt, District Judge:
MEMORANDUM DECISION AND ORDER
Presently before the Court is a motion for a preliminary injunction filed by the Plaintiffs to enjoin the implementation of Nassau County Local Law No. 8-2012, also known as Clerk Item No. 315-2012, asserting that it violates the Plaintiffs' fundamental constitutional rights secured by Article I, Section 10 of the United States Constitution (the "Contracts Clause"), as well as other state statutory provisions. For the reasons set forth below, the motion for a preliminary injunction is granted.
The Plaintiff Danny Donohue is the elected statewide president of the Civil Service Employees Association, Inc. (the "CSEA"), which represents approximately 295,000 employees and retirees throughout the State of New York. The Plaintiff Jerry Laricchiuta is the elected President of the CSEA Nassau Local 830, a subdivision of the CSEA, which represents approximately 7,000 employees of Nassau County (the "County").
The Plaintiff John Jaronczyk is the elected president of the Nassau County Sheriff's Correction Officers Benevolent Association, Inc. ("COBA"), which represents County Sheriff's Department employees serving in the civil service titles of Correction Officer, Correction Corporal, Correction Sergeant, Correction Lieutenant, Correction Captain and employees serving in investigative ranks.
The Plaintiff James Carver is the president of the Police Benevolent Association of the Police Department of the County of Nassau, Inc. (the "PBA"), which is the exclusive collective bargaining representative of all uniformed police officers employed by the County. The Plaintiff Gary Learned is the president of the Superior Officers Association Police Department, County of Nassau, Inc. (the "SOA"), which is the exclusive collective bargaining representative for the unit consisting of Superior Officers ranging from Sergeant through Assistant Chief of the County Police Department. Finally, the Plaintiff Glenn Ciccone is the president of the Detectives' Association, Inc. of the Police Department of the County of Nassau (the "DAI"), which is the exclusive collective bargaining representative for the unit consisting of Detectives employed by the County.
There are three sets of plaintiffs in this consolidated action----the Donohue Plaintiffs, the Jaroncyzk Plaintiffs, and the Carver Plaintiffs. For purposes of this Order, the Court will refer to these three sets of plaintiffs collectively as the "Plaintiffs", "bargaining units", or "unions", unless otherwise specified.
The Defendants are the County of Nassau, the Nassau County Legislature (the "Legislature"), Edward Mangano, in his official capacity as County Executive of Nassau County, Peter Schmitt, in his official capacity as Presiding Officer of the Nassau County Legislature, and George Maragos, in his official capacity as Nassau County Comptroller. "While the named Defendants differ in part as to each case due to the different groups of public employees represented as Plaintiffs in [each of the consolidated] matters, the object of the preliminary injunction motions and the arguments made in support of those motions are broadly the same." Donohue v. Paterson, 715 F. Supp. 2d 306, 312 (N.D.N.Y. 2010). Thus for purposes of this Order, the Court will refer to the various defendants in all three consolidated actions collectively as the "Defendants".
In the three consolidated actions, the Plaintiffs are public employee organizations within the meaning of Section 201 of the Public Employees' Fair Employment Act, Civil Service Law §200 et seq. (the "Taylor Law"), as well as officers from these organizations.
"[T]o promote harmonious and cooperative relationships between government and its employees and to protect the public by assuring, at all times, the orderly and uninterrupted operations and functions of government," Article 14 sets forth the rights of employee organizations, and the procedures governing their relations with the State as an employer. See N.Y. Civ. Ser. Law § 200.
Donohue, 715 F. Supp. 2d at 313.
The manifestation of this working relationship between the County government and its employees is their negotiated contractual agreements. The Plaintiffs are parties to a number of various collective bargaining agreements ("CBAs") with the County, which set forth the terms and conditions of their employment. In particular, the terms of the CBAs generally include salaries, wages, employee benefits such as medical insurance, and hours of work. In each of the three Complaints in the present case, the Plaintiffs take care to describe the relevant background information that is specific to their bargaining unit's negotiation history. Several of the unions describe the concessions that they have made throughout the past few years, in order to meet the demands of the previous County Executive.
On April 30, 2012, the County Executive Edward Mangano ("Mangano" or the "County Executive") proposed Local Law No. 8-2012----also known as Clerk Item No. 315-2012 ("LL 315-12")----which was submitted to the County Legislature for approval. LL 315-12 explains the background of the law, in a section entitled "Legislative Intent", as follows:
Nassau County is currently embroiled in a fiscal crisis which has seriously jeopardized its ability to finance the payment of tax certiorari settlements and judgments. This crisis is particularly acute because the inability of the County to finance the payment of those settlements and judgments has resulted in economic hardship for many of the County residents and businesses who are owed refunds pursuant to those settlements and judgments. (LL 315-12 § 1.) The legislation goes on to refer to the historical background of the law. In particular, it states that the County Executive had submitted a multi-year financial plan, approved by the Nassau County Interim Finance Authority ("NIFA"), which included provisions for transitional financing of tax refunds. However, in order to secure bonding to finance the payments under this plan, a bipartisan super-majority vote of the County Legislature was required pursuant to the New York Local Finance Law. Thus, despite the "clear need to raise funds to finance the payment of these refunds," the law states that "certain Legislators have steadfastly refused to approve any bonding absent a quid pro quo". (LL 315-12 § 1.)
This set of circumstances has supposedly led to a conundrum for Mangano and the County. Because the Legislature failed to approve the bonding to cover the payment of these settlements and judgments, "the individuals and businesses who are owed refunds are entitled to ask a court to order the execution of those judgments and settlements by levying against the County's bank accounts . . . [which] would result in widespread chaos throughout the County." (LL 315-12 § 1.) Thus, in light of this economic problem, the County Executive took action to provide for the financing necessary for the payment of the tax certiorari refunds owed by the County. The action he took was the creation and proposal of LL 315-12.
The provision currently at issue in this suit is Section 2, entitled "Action by the County Executive". It states, in pertinent part, that:
(A) Notwithstanding any inconsistent provision of law, the County Executive, upon the issuance of an Executive Order invoking this Local Law, shall be authorized to take any action he deems necessary, including but not limited to, the following actions in order to create forty-million-dollars in savings for the County.
1. relieve from duty any duty [sic] employees represented by a collective bargaining unit for one day per week [("furloughing")]
3. modify any County contracts
4. freeze base and supplemental wages for County employees
5. reduce or eliminate employer contribution to employee benefits
6. sell, lease, or otherwise dispose of any and all real and personal property owned by the County including, but not limited to, vehicles, buildings, land, computers, and heavy machinery
7. close or restrict hours of operation of any County facility
8. reduce or eliminate any County operated program or service whose continuing existence is not mandated by State or Federal law
9. shutter, reduce, or eliminate any County agency or department whose continuing existence is not mandated by State or Federal law
10. reduce or eliminate assistance to Towns, Cities and Villages within the County
11. any action not enumerated in this list but otherwise authorized pursuant to State, Federal or County law (LL 315-12 § 2.) Any savings realized from these actions would be utilized solely for the purpose of financing tax certiorari judgments and settlements.
On May 21, 2012, LL 315-12 was scheduled for a vote of the full legislature. However, the Plaintiffs claim that only 18 of the 19 County Legislators were present in the Legislative Chamber for the day's proceedings. According to the Plaintiffs, it was announced that Legislator Dennis Dunne was in another room in the building and would be participating from that location. The Plaintiffs allege that throughout the day's proceedings, Presiding Officer Peter Schmitt began discussions with regard to LL 315-12 and County Attorney John Ciampoli spoke on the subject. Presiding Office Schmitt then supposedly announced "We're going to conclude this hearing and I'm not calling a vote today", and that the Legislature would vote on this law at another time.
However, according to the allegations in the Complaint, at the conclusion of all other business, on May 21, 2012, Presiding Officer Schmitt called for a vote on LL 315-12 without permitting public comment. At that time, all nine Democratic members of the County's legislature, constituting the Legislative Minority, allegedly refused to participate in the vote and then exited the Legislative chambers in protest. The nine remaining members of the Legislature-the Republicans and part of the Legislative Majority-voted in favor of passing LL 315-12. In addition, Presiding Office Schmitt counted Legislator Dunne as the tenth affirmative vote in favor of LL 315-12.
On May 22, 2012, the day following the legislative vote, three separate actions were filed in this Court---- 12--CV--2568 (the Donohue Plaintiffs); 12--CV--2569 (the Jaroncyzk Plaintiffs); and 12--CV--3066 (the Carver Plaintiffs)----all stemming from the above described "passage" of LL 315-12. The Plaintiffs asserted multiple causes of action for violations of (1) the Contract Clause, pursuant to 42 U.S.C. § 1983; (2) the New York State Constitution, Article I, § 17 and Article 14, § 2(c); (3) the New York State Municipal Home Rule Law, § 10; (4) Article 7 of the Public Officers Law, entitled the Open Meetings Law, §§ 103--04; (5) General Construction Law, § 41; and (6) Nassau County Charter, § 152. With regard to the relief sought, the Plaintiffs sought a declaratory judgment that certain portions of LL 315-12 violate the above mentioned constitutional and statutory provisions, and the entry of a permanent injunction to enjoin the County Executive from taking any further action to implement or enforce the unconstitutional portions of LL 315-12. In addition, they sought a temporary restraining order and a preliminary injunction.
The Court held a hearing on that day, May 22, 2012, and learned that LL 315-12 had not yet been signed into law by the County Executive. Thus, because of concerns about ripeness, this Court denied the request for a temporary restraining order and a preliminary injunction without prejudice, with leave to renew if, and when, the County Executive either signed LL 315-12 into law or took no action with regard to bill for a specified period of time, either of which event would render the law effective.
On or about June 18, 2012, County Executive Mangano officially signed LL 315-12 into law. On June 19, 2012, the Plaintiffs filed a second motion for a temporary restraining order and a preliminary injunction. On June 20, 2012, the Court held a second hearing. At this time, the Court consolidated the three cases on the record, bearing case number 12-CV-2568. In addition, the Court set a briefing schedule, based upon a representation by the Defendants that no executive orders would be issued pursuant to LL 315-12 until the Court issued a decision on the motion for preliminary injunctive relief. Thus, the motion for a temporary restraining order has been essentially converted into a motion for a preliminary injunction. See Hedges v. Obama, No. 06 Civ. 0589, 2012 WL 1721124, at *1 (S.D.N.Y. May 16, 2012) (converting a motion for a temporary restraining order into a motion for a preliminary injunction during a conference with the court).
Finally, the Court granted permission for the Minority Caucus of the Legislature to file an amicus curiae brief, which it did on July 19, 2012. The Minority Caucus consists of Minority Leader Kevan Abrahams and Legislators Wayne H. Wink, Jr., Robert Troiano, Carrie Solages, Joseph Scannell, Judi Bosworth, Judy Jacobs, Delia Deirggi-Whitton, and David Denenberg (collectively the "Minority Caucus" or "amicus"). The Defendants urge the Court to strike the amicus brief because it is twenty-five pages in length, despite being a "reply" brief in connection with the Plaintiffs' motion for a preliminary injunction. However, the Court rejects this argument and will consider the entirety of the amicus brief.
Broadly, the Plaintiffs claim that LL 315-12 authorizes the County Executive to take actions that will diminish the actual and negotiated salaries and benefits received by the thousands of employees covered under the relevant CBAs, and that the impact of these impairments will be widespread and irreparable. The Plaintiffs argue in support of their motion for a preliminary injunction that this law renders the agreements between the unions and the County unenforceable, and thus virtually obliterates the authority and position of the unions as bargaining representatives.
There are specific portions of LL 315-12 that undoubtedly apply to the Plaintiff unions and thus are at issue in the present case, such as the County Executive's power to (1) "relieve from duty any duty employees represented by a collective bargaining unit for one day per week"; (2) "modify any County contracts"; (3) "freeze base and supplemental wages for County employees"; and (4) reduce or eliminate employer contribution to employee benefits". (LL 315-12, §2(A)(1), (3)--(5).) However, there are other portions of the law that the Plaintiffs do not challenge and do not appear to be in contention, such as the County Executive's power to "sell lease, or otherwise dispose of any and all real and personal property owned by the County including, but not limited to, vehicles, buildings, land, computers, and heavy machinery". (LL 315-12, §2(A)(6).) This Decision will only address the provisions of LL 315-12 to the extent that they modify the CBAs and other contractual employment agreements between the Plaintiffs and the Defendants. Therefore, the Court will take no position on any provisions in LL 315-12 to the extent that they do not affect the Plaintiffs' contractual rights.
The issues presented by the present motion are myriad and complex. The Court will first address any questions as to jurisdiction, and will then proceed to assess the substantive merits of the motion for a preliminary injunction.
A.Stay Requested by the Defendants
As an initial matter, on August 10, 2012, the Defendants wrote a letter to the Court requesting a stay of the case while they pursue a course of action, which, if successful, would render moot the issues before the Court. "Specifically, Defendants are examining a method to address and resolve the County's liability for over $40 million in tax certiorari judgments that would have no contractual impairment on Plaintiffs." (Docket Entry No. 39.) Each set of Plaintiffs subsequently wrote a response to the Court, vehemently opposing any such request.
In their August 10, 2012 communication to the Court, the Defendants do not provide any specificity as to the "method" they are investigating to obtain the necessary funding, nor do they state any sort of time period in which they can accomplish such a task. In light of the finding of irreparable harm explored below, the Court is not satisfied that an indefinite stay of the case based solely on the County's vague search for other options is the appropriate course of action. Even if the County refrains from taking any action pursuant to LL 315-12, the existence of the law instigates an irreparable harm by itself. The entire premise underlying the preliminary injunctive relief requested here is to avoid the furtherance of this harm. To grant a stay and defer enforcement of the law would be plainly contradictory to that goal and thus may pose further injury to the Plaintiffs.
Moreover, to deny the stay would likely not injure the Defendants in any way. If, as the Defendants state, they are acting in furtherance of resolving the County's liability for more than $40 million in tax certiorari judgments in a way that would have no contractual impairment on the Plaintiffs, then there is one simple solution-they can repeal LL 315-12. Alternatively, as explained below, if the County obtains a certification issued by the Office of Legislative Budget Review that the $40 million in savings have been achieved, the law will automatically expire, thus rendering the present case moot. (LL 315-12, § 2(B).) The Defendants have had ample time to pursue either of these options, and will continue to have the time to do so even after the issuance of this Decision and Order.
Therefore, the Court declines the Defendants' request to stay the present case and will proceed to rule on the Plaintiffs' motion.
The next threshold issue that the Court must address prior to reviewing the substantive merits of the case is mootness. See Aladdin Capital Holdings, LLC v. Donoyan, 438 Fed. App'x. 14, 15 (2d Cir. 2011) ("We must first address whether we have Article III jurisdiction and resolve an issue of mootness."); see also United States v. Miller, 263 F.3d 1, 4 n.2 (2d Cir. 2001) ("[A] federal court may not . . . decide a case on the merits before resolving whether the court has Article III jurisdiction."). In short, the amicus asserts that the County has decided to use existing cash reserves to pay the outstanding tax certiorari judgments at issue. Accordingly, because the sole purpose of the law has already been fulfilled, the amicus contends that the Court need not address the constitutionality of LL 315-12's provisions.
"Mootness is a doctrinal restriction stemming from the Article III requirement that federal courts decide only live cases or controversies." In re Zarnel, 619 F.3d 156, 162 (2d Cir. 2010). Under the doctrine of mootness, a court no longer has subject matter jurisdiction when "the issues presented are no longer live or the parties lack a legally cognizable interest in the outcome." Cnty. of Los Angeles v. Davis, 440 U.S. 625, 631, 99 S. Ct. 1379, 1383, 59 L. Ed. 2d 642 (1979) (quoting Powell v. McCormack, 395 U.S. 486, 496, 89 S. Ct. 1944, 1951, 23 L. Ed. 2d 491 (1969) (internal quotation marks omitted)).
Thus, for a federal court to have subject matter jurisdiction over a case, "it is not enough that a dispute was very much alive when suit was filed . . . . The parties must continue to have a personal stake in the outcome of the lawsuit." Knaust v. City of Kingston, 157 F.3d 86, 88 (2d Cir. 1998) (quoting Lewis v. Continental Bank Corp., 494 U.S. 472, 477--78, 110 S. Ct. 1249, 108 L. Ed. 2d 400 (1990)) (internal citation and quotations omitted), cert. denied, 526 U.S. 1131, 119 S. Ct. 1805, 143 L. Ed. 2d 1009 (1999); see Church of Scientology of Cal. v. United States, 506 U.S. 9, 12, 113 S. Ct. 447, 121 L. Ed. 2d 313 (1992) ("It has long been settled that a federal court has no authority to give opinions upon moot questions or abstract propositions, or to declare principles or rules of law which cannot affect the matter in issue in the case before it." (internal quotation marks omitted)).
Thus, the preliminary and essential inquiry is whether the relief sought by the Plaintiffs is no longer needed, so as to make the present case moot. See Martin--Trigona v. Shiff, 702 F.2d 380, 386 (2d Cir. 1983) ("The hallmark of a moot case or controversy is that the relief sought can no longer be given or is no longer needed."); Cook v. Colgate Univ., 992 F.2d 17, 19 (2d Cir. 1993) ("Accordingly, a case that is 'live' at the outset may become moot 'when it becomes impossible for the courts, through the exercise of their remedial powers, to do anything to redress the injury.'") (quoting Alexander v. Yale, 631 F.2d 178, 183 (2d Cir. 1980)).
LL 315-12 is undoubtedly clear in that the County Executive may take any action he deems necessary, but only for the express purpose of achieving $40 million in savings in order to pay outstanding judgments for real property tax refunds, commonly known as "tax certiorari judgments". LL 315-12 provides that "[a]ny savings realized pursuant to the authorities granted by this Local Law shall be used solely to finance tax certiorari judgments and settlements." Moreover, the law explicitly states that the "authorities granted" under the law "shall expire upon a certification issued by the Office of Legislative Budget Review that forty-million dollars in savings have been achieved." (LL 315-12, § 2(B).)
The mootness issue was not raised by any of the parties, but rather by the amicus Minority Counsel. In the amicus papers, the Minority Counsel asserts that this entire dispute is moot because the purpose of LL 315-12-saving $40 million to satisfy outstanding tax certiorari judgments-has been fulfilled. The Minority Counsel bases this factual assertion on a transcript from the June 18, 2012 legislative session. From this, it concludes that the County Executive has decided to pay the outstanding tax judgments using a pool of money referred to as "the unallocated and undesignated fund balance."
In response, the Defendants first argue that this is an issue that cannot be properly raised by the amicus curiae. However, the Court need not reach the legal question of whether this mootness argument raised through the vehicle of an amicus brief is proper, because there is sufficient evidence before the Court to find that its factual premise is fatally flawed and thus, mootness does not yet taint the instant case.
Although the amicus has been unable to produce a certification issued by the Office of Legislative Budget Review stating that the savings have been achieved-nor does it claim one exists-it maintains that this requirement has been fulfilled for all intents and purposes. As mentioned above, this assertion is based upon a legislative session that took place on June 18, 2012, the same day that LL 315-12 went into effect. At that time, County Budget Director Eric Naughton stated on the record that "the County has roughly 92 million in undesignated fund balance" at its disposal. (See Clines Decl., Ex. B, at 82--83.) Thus, at this session, it was determined that a $43 million entry would be made in the County's books. Maurice Chambers, the Director of the Legislative Budget review, stated that: "The 92 million is what we have in reserves; that's real money. The 43 million is just an entry to recognize the 43 million liability for tax certs, which ultimately will be taken out of the fund balance." (Id., at 110.)
However, the Court agrees with the Defendants that the transcript of the June 18, 2012 legislative session makes clear that there has been no actual transfer of money to pay for the outstanding judgments. This dialogue does not indicate that the County planned to actually use the reserves to pay the tax certiorari judgments. Rather, it appears to the Court that the discussion was merely about how to properly account for these judgments on the County's books. In fact, Budget Director Naughton stated that "[w]e are transferring the money to the treasurer's office so the comptroller's office can book and accrual for tax certs." (Id. at 67.) Frank Moroney, the Deputy Comptroller, also stated at the session that "[w]e're transferring this because it appears as though there is going to be a deficit, and it has to be assigned to the proper place, and that would be to tax certioraris." (Id. at 70.) According to the Defendants, the only thing they determined was that for accounting purposes for the 2011 budget, the Office of Legislative Budget Review set up an appropriation line in ...