The Nassau County district attorney Wednesday declined to file charges against county Comptroller and former Long Beach City Manager Jack Schnirman and other city officials in a payout probe, but investigators cited "egregious incompetence" in Long Beach's government.
The DA's public corruption unit opened an investigation in 2018 after Long Beach failed to pass a $2.1 million bond to cover separation payments for about a dozen current and former employees, including a $108,000 separation payment to Schnirman paid before he left to serve as comptroller.
"During Mr. Schnirman’s tenure as city manager, he allowed millions of dollars in improper payments to be made, personally accepted a payment much more generous than provided-for by the plain language of his contract and waited more than a year to return that payout while under state and federal investigation," said Nassau District Attorney Madeline Singas. "The taxpayers of Long Beach deserved better."
Singas said the evidence did not meet New York's burden to file official misconduct charges. Prosecutors did not find knowing misconduct or intentional breach of duty to file criminal charges.
Schnirman responded through his comptroller's office, saying he deferred all payments through city legal counsel.
"[He] is the only person to voluntarily return the portion of the payment that was called into question by the audit that examined decades worth of practices, long predating his tenure in Long Beach," comptroller spokesman Brett Spielberg said."Jack is focused on the work Nassau County residents elected him to do as comptroller."
Investigators said the city practiced a history of excessive vacation and sick time payouts to employees for the past 20 years, as well as drawdowns of accrued time for current employees, relying on a 1997 interpretation of city policy.
"Our investigation found rampant, longstanding, egregious incompetence by many public officials within the Long Beach government, and an unconscionable ignorance of the law and abdication of oversight on the part of the Long Beach City Council," wrote DA Public Corruption Chief Christine Maloney in a letter to Long Beach city officials.
The public corruption bureau interviewed more than 30 current and former Long Beach employees and reviewed thousands of pages of records, but were delayed by critical witnesses who refused to cooperate, and required the new city council in January to waive attorney-client privilege.
"Still, while we found the justifications offered for these payments to be incredible and inconsistent with the plain language of the applicable laws and contracts, we found no evidence suggesting the leave balances were unearned, nor did we find evidence of the criminal intent necessary to bring criminal charges," Singas said.
Prosecutors and auditors found that the city paid out nearly all of accrued vacation and sick time to employees that violated the city code’s limit of 50 vacation days and 30% sick time.
Schnirman returned $52,780 to the city last year after a state comptroller audit found that he was overpaid for 662 hours of sick time.
The state audit found that Long Beach overpaid city management employees $750,000 in accrued vacation and sick time and encouraged the city to recoup any unlawful paybacks.
The City of Long Beach has filed a $2.4 million lawsuit against Schnirman and former Corporation Counsel and Acting City Manager Rob Agostisi, seeking to hold them personally liable for payouts for the past decade. Agostisi left the job in September 2019.
The Eastern District U.S. Attorney's office also launched a separate probe, including a federal grand jury. Officials declined to comment on the investigation, but the city's outside counsel, John Gross, said that the federal criminal investigation on Schnirman and Agostisi is ongoing.
"There is no connection between the lack of criminal charges and our City Council’s pursuit of repayment through our lawsuit," City Council president John Bendo said in a statement. "They may not be facing jail time in Nassau County, but they will be accountable in court facing the City’s civil lawsuits."
Agostisi's attorney, Rick Ostrove, said in a statement that the payout policy was based on the city's legal opinion and called the city's lawsuits "a wasteful political attack."
"Further, it is totally irresponsible for the City Council to state that a federal probe is ongoing. Regardless, there was no criminal conduct," he said."