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Oyster Bay Town supervisor sued by state to recover Sandy damage payment

The state agency that administers federal relief funds said in the lawsuit that Joseph Saladino failed to disclose a homeowner's insurance settlement for damage to his home in Massapequa.

Town of Oyster Bay Supervisor Joseph Saladino delivers

Town of Oyster Bay Supervisor Joseph Saladino delivers his second State of the Town Address on Tuesday, June 12, 2018 in Oyster Bay. Photo Credit: Howard Schnapp

Oyster Bay Town Supervisor Joseph Saladino received almost $16,000 of federal disaster relief for which he was not eligible, a lawsuit filed in state court alleges.

The Housing Trust Fund Corp., a New York State agency that administers the funds, said in the lawsuit filed in September in State Supreme Court in Mineola that Saladino failed to disclose a homeowner’s insurance settlement for damage from superstorm Sandy to his primary residence in Massapequa. The settlement made him ineligible for a $15,803 New York Rising Housing Recovery Program grant he received in 2015, according to the complaint.

On Monday, staff from New York State Homes and Community Renewal, the department overseeing the recovery program and the Housing Trust Fund Corp., said that neither Saladino nor his representatives had responded to the agency and the litigation was continuing.

On Tuesday, Oyster Bay Town spokesman Brian Nevin emailed a statement from Saladino that said, “It was paid and the matter settled without interest or penalty.”

“I resolved this matter rather than fight NY Rising for the assistance other victims received and many of whom are still fighting for,” Saladino said in the emailed statement. “The cost of fighting for this assistance outweighs any help NY Rising would otherwise provide.”

Saladino declined to provide documents that showed a payment or settlement, only saying in an email from Nevin later Tuesday: “Bank check. $15,803.88.”

Staff from the state homes and community renewal unit declined to comment on the case other than to say Tuesday night that the litigation was “ongoing.”

The Housing Trust Fund Corp. had been trying for the past 18 months to collect the money from Saladino, according to the lawsuit. The agency sent eight letters to Saladino between June 13, 2017, and July 3, 2018, telling him to return the $15,803 payment, but he neither returned the funds nor filed an appeal, the complaint said.

The lawsuit said Saladino entered into a grant agreement with the Housing Trust Fund Corp. for $31,607 to cover rehabilitation and reconstruction costs for damage to his home from Sandy and Hurricane Irene. The amount was equal to the initial assessed project cost minus a flood insurance settlement, the complaint alleged. He received half the grant amount, according to the lawsuit.

The lawsuit alleged, among other causes of action, that Saladino committed “fraudulent inducement” when he made false representations to receive benefits from the trust fund that were not permitted under the federal disaster program because the damage was covered by insurance.

Saladino “received the duplicate benefits making him ineligible to receive the overpayment” of $15,803, the complaint alleges. Saladino “represented” to the NY Rising grant program that he had disclosed all duplicated benefits and that he would promptly report any repetitive benefits he later received, the complaint states. Saladino “knew or should have known this representation was false,” the complaint alleges.

After Sandy devastated Long Island in 2012, the Housing Trust Fund Corp. was charged with administering federal relief funds under the NY Rising program to help homeowners make repairs caused by Sandy, Hurricane Irene in 2011 and Tropical Storm Lee in 2011.

In 2013, Saladino started an application for NY Rising funds for a portion of $114,883 in repairs to his waterfront house, the complaint states. He disclosed a $75,889 payment from the National Flood Insurance Program for the damage in his application materials, but the complaint alleges he did not inform the state that he also received $64,545 from his homeowner’s insurance.

County records show Saladino purchased the single-family house in 2003 for $740,000.

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