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In re Waite

New York Court of Appeals

June 27, 2018

In the Matter of Jennifer Waite, et al., Appellants,
Town of Champion, Respondent.

          Bradley M. Pinsky, for appellants.

          Jonathan B. Fellows, for respondent.


          RIVERA, J.

         In this CPLR article 78 proceeding, petitioners claim that respondent failed to accomplish and complete the dissolution of the Town of Champion Fire Protection District as required by the General Municipal Law. On the facts of this case, we conclude that respondent's actions are not affected by an error of law because it prepared, approved, and implemented a dissolution plan in compliance with the applicable statutory requirements, and lawfully created two legally distinct fire protection districts to deliver fire protection services to the Town of Champion residents, in accordance with Town Law section 170.

         I. Statutory Background

         In 2009, the Legislature enacted the "New N.Y. Government Reorganization and Citizen Empowerment Act" (Act), codified as General Municipal Law article 17-a, in order to "establish[] uniform and user-friendly procedures for local government entities to consolidate or dissolve" (Sponsor's Memorandum, Bill Jacket, L 2009 ch 74, at 6). As relevant to this appeal, title 3 of the Act provides that a local government entity other than a town may be dissolved through a dissolution proceeding, initiated by the entity's governing body or directly by its electors (see General Municipal Law § 772). For the electors to initiate a dissolution proceeding, a specified fraction of the local government entity's electorate must sign a petition substantively conforming to language specified in the Act and calling for a referendum (see GML § 779). The referendum on the entity's continued existence is then put to a vote at a special or general election (id. § 780). If the referendum passes by majority vote, the governing body of the local government entity subject to the referendum must prepare and approve a "dissolution plan," which specifies, among other things, "the manner and means by which the residents of the entity will continue to be furnished municipal services following the entity's dissolution" (id. § 782 [2] [i]). The dissolution plan must also spell out "terms for the disposition of the entity's assets... liabilities and indebtedness," as well as the date on which it shall become effective (id. §§ 782 [2] [j], [l]).

         Thereafter, the governing body must make the plan available for public inspection and hold public hearings, upon reasonable notice, so that the public at large has an opportunity to comment on the proposed dissolution (see id. §§ 782, 784). After the hearings, the governing entity must approve a final version of the dissolution plan. If, as a result of public comment, the plan is amended, it must be publicly posted anew before the final vote (see id. § 784). After its ultimate approval, the dissolution plan takes effect on the date specified, which by statute must be at least 45 days after the final vote, unless implementation is forestalled under the Act (see id. § 785).

         In particular, the Act allows electors to subject the implementation of an elector-initiated dissolution plan to a "permissive referendum" (id.). Thus, if electors are dissatisfied with a proposed dissolution plan, apart from airing their concerns through the public hearing and participation process, they may, by obtaining a specified number of signatures petition to put a referendum question to the electorate as to whether the dissolution plan should take effect (see id.) [1]. If they gather enough signatures to trigger a permissive referendum, the dissolution plan goes into effect only if a majority vote in its favor (see id.). Moreover, where the local governing body "fails to prepare and approve [a dissolution plan] or is otherwise unable or unwilling to accomplish and complete the dissolution," "five electors who signed the petition seeking dissolution may commence a special proceeding against the entity pursuant to article [78]... to compel compliance" (id. § 786 [1]).

         The instant appeal concerns the dissolution of a fire protection district (FPD), one of two local entities a town may create to facilitate provision of fire protection services to the town's residents. Upon its creation of an FPD, the town board, as the town's governing body, assumes the duty to provide fire protection through volunteer and paid firefighters. To that end, it may "contract with any city, village, fire district or incorporated fire company... for the furnishing of fire protection" (Town Law § 184 [1]). These contracts are paid for by an assessment on the FPD, which, according to the State Comptroller, must be uniform across the FPD (Opns St Compt, 1981 No. 81-311). FPD taxes must be administered by the town "in the same manner, at the same time and by the same officers as [are] town taxes" (Town Law § 184 [6]), and the town may ultimately be liable for the negligence of its firefighting personnel (see Nelson v Garcia, 152 A.D.2d 22, 24-25 [4th Dept 1989]).

         Alternatively, a town board may choose to create a fire district (FD) to provide fire protection services. An FD, unlike an FPD, is a distinct "political subdivision of the state and a district corporation within the meaning of section three of the general corporation law" in its own right (Town Law § 174 [7]) [2]. Its "officers and employees..., including the paid and volunteer members of the fire department thereof, are officers and employees of such [FD] and are not officers or employees of any other political subdivision" (id.; see also Nelson, 152 A.D.2d at 25 [observing that an FD is "a wholly independent political subdivision whose members,' including its volunteer fire(fighters), are employees of the (FD) and not of the town"]). An FD is headed by independent commissioners who devise the FD's budget, which, when approved, is independently implemented by the county's board of supervisors (see Town Law §§ 174, 181). In addition, an FD's commissioners have the power to set differential tax rates across the FD, charging FD residents different amounts based on the specific cost of providing them with fire protection services (see id. § 176 [27]).

         Both an FPD and an FD may be created by "the town board of any town" "[u]pon its own motion and without petition" (id. § 170 [2]). They may also be initiated by petition, if "resident[-]taxpayers owning taxable real property aggregating at least one-half of the assessed valuation of all the taxable real property of the proposed district" so request (id. § 171 [1]). Filing an appropriate petition does not guarantee the creation of an FPD or FD, because the proposal must go through a public comment period, and is subject to approval or disapproval in the discretion of the town board (see id. § 171 [3]).

         II. Factual and Procedural Background

         Petitioners are five resident-electors and legal voters of respondent Town of Champion (Town) and signatories to a Petition for Local Government Dissolution pursuant to General Municipal Law section 779 (Petition), which demanded a referendum on the dissolution of the Town of Champion Fire Protection District (CFPD). The Town is a municipal corporation in Jefferson County, mostly covered by the CFPD, [3] and governed by the Town Board. To provide fire protection in the CFPD, the Town contracted with three separate fire departments-the local Champion Volunteer Fire Company, and the fire departments of the neighboring villages of West Carthage and Copenhagen.

         Upon confirmation that the Petition contained sufficient signatures, the Town Board resolved to call for a referendum to ask whether the CFPD should be dissolved. The referendum was held, and its passage was announced at a Town Board meeting. At a follow-up meeting, the Town Board presented and approved a Plan for Dissolution (Plan) pursuant to General Municipal Law section 782. The Plan provided for the dissolution of the existing CFPD and the creation of two new FPDs, which would cover the same geographic area as the CFPD. Under the Plan, the Town would enter separate contracts for each FPD for the provision of fire protection services, specifically a contract with the fire department of the Village of West Carthage to provide services in FPD 1, and a contract with the fire department of the Village of Copenhagen for services in FPD 2. After a subsequent special meeting of the Town Board and public hearings, the Board approved three resolutions: the dissolution of the CFPD, and, separately, the creations of FPDs 1 and 2. The Board resolutions were thereafter filed with the County Clerk and New York's Department of State, as is required of all resolutions dissolving, establishing, or altering FPDs (see Town Law § 173).

         Petitioners disapproved of the Plan and a petition was circulated calling for a referendum on whether the Plan should take effect, but the petition failed to garner sufficient valid signatures. Simultaneously, petitioners filed this article 78 proceeding pursuant to General Municipal Law section 786, challenging the Plan and the creation of the two FPDs. Petitioners sought a declaration that the Plan was void and an order directing the Town to comply with the Act by adopting a dissolution plan that did not involve the creation of an FPD controlled by the Town Board.

         Supreme Court dismissed the petition, holding that the Town followed the required procedures and acted within its authority to determine whether to create an FD or an FPD. The Appellate Division affirmed, concluding that the Town complied with the Act, and observing that petitioners failed to attain enough signatures to challenge the Plan by referendum or to petition for the establishment of an FD (see 148 A.D.3d 1634, 1634 [4th Dept 2017]). We granted petitioners leave to appeal (29 N.Y.3d 912');">29 N.Y.3d 912');">29 N.Y.3d 912');">29 N.Y.3d 912 [2017]).

         III. The Town's Compliance with Its Statutory Obligations

         Petitioners allege that the Town acted contrary to law because the Town Board never dissolved the CFPD but instead divided it in half, and in so doing maintained control over the provision of fire protection services, against the will of the voters and in violation of the Act. Petitioners request that we vacate the Plan and instruct the Town Board to adopt one that conforms with the Act. The Town counters that it has complied with all the applicable statutory procedural requirements to dissolve the CFPD, and that it created the two FPDs pursuant to law.

         In this article 78 proceeding to compel compliance with the provisions of the Act, we review the Town's actions to determine whether they were "affected by an error of law" (Scherbyn v Wayne-Finger Lakes Bd. of Co-op Educational Services, 77 N.Y.2d 753, 758 [1991] [citations omitted]). To prevail, petitioners must establish "a clear legal right to the relief demanded" by demonstrating the "exist[ence of] a ...

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