Category: News on the Homepage

Congratulations to CMM Controller Amanda L. Sexton, CPA/ABV/CFF, CFE, who has been named to the New York State Society of CPAs (NYSSCPA) inaugural 40 Under 40 list. The awards recognize CPAs and accounting professionals with notable skills who are visibly making a difference in the profession. The winners will be presented with their awards during the NYSSCPA NextGen Conference later this month, held online due to the pandemic.

As Controller, Sexton oversees CMM’s accounting department and is responsible for budgeting and forecasting, cash flow management, financial reporting, internal controls assessments, year-end tax planning, and managing the firm’s banking relationships. These roles have taken on added significance during the COVID-19 pandemic. In addition, with her credentials and licenses including ABV (Accredited in Business Valuation), CFF (Certified in Financial Forensics), and CFE (Certified Fraud Examiner), Sexton adds another dimension to the services that CMM provides to its clients.

Sexton served as the youngest President in the history of the Suffolk chapter of NYSSCPA, created two new committees that continue to serve the Society’s members today, and actively seeks out new knowledge and experience in both public and private accounting.

Prior to joining CMM, Sexton served as Controller for a $30MM construction contractor in Suffolk County. She began her career in public accounting, primarily in the areas of accounting and auditing, business valuation and litigation support. She has provided expert witness testimony multiple times in the Supreme Court of the State of New York, and also has several years of experience auditing grant programs funded by various federal, state and local agencies.

By James T. Madore, Newsday

Long Island could lose up to 28% of its jobs by Dec. 31 because of the coronavirus and subsequent economic shutdown, according to a report released Thursday.

The estimated net loss of up to 375,000 jobs stems from businesses never reopening, and from many of those that do reopen not being able to recall all the workers who were laid off or furloughed. The state Department of Labor reports that the Island had about 1.3 million nonfarm jobs last year.

About 270,000 people were laid off in Nassau and Suffolk counties in March and April, the height of the pandemic; only 48,000 jobs were recouped in May. The pink slips were most prevalent among low-wage employees, those with a high school diploma or less, and Hispanics — because those groups are heavily represented in the hardest-hit industries: restaurants/hotels, health care/social services and retail, the report states.

The coronavirus employment losses will mean less economic activity on Long Island — down an estimated $61 billion this year, the report projects. That would represent about 38% of the gross domestic product, the sum of all goods and services produced here.

Consumer spending accounted for about 70% of Long Island’s 2018 GDP of $162.4 billion, according to the most recent data from the federal Bureau of Economic Analysis.

“Earnings and spending losses may be even greater in 2021 owing to prolonged recovery within some sectors coupled with expiring unemployment benefits,” said the report’s author, HR & A Advisors, an economic development consulting firm in Manhattan.

The leader of the HIA-LI, one of Long Island’s largest business organizations, agreed, saying business owners are reluctant to invest in buildings, equipment and people until a COVID-19 vaccine becomes available. 

“The report’s numbers are spot on,” said Joe Campolo, a business law attorney and chairman of the group formerly called the Hauppauge Industrial Association. “Right now, businesses don’t know if they’re going to make it. Until there’s a vaccine, we’re going to be hurting,” he said on Thursday.

The counties commissioned the 99-page report in April to bolster their lobbying for additional federal and state aid. HR & A consultants estimated the 2020 revenue loss for Nassau is $360 million and for Suffolk, $325 million. Both are expected to see big drops in sales-tax collections because consumer spending is down. 

“With the fastest rise of unemployment on record leading to a complete fall off of economic activity, this report further outlines the stark reality of our local economy,” Nassau County Executive Laura Curran said in releasing the report at a Melville event with Suffolk County Executive Steve Bellone. “We cannot recover from this devastating crisis alone — Washington needs to step in now with support for local governments, so we can continue to provide vital services for our residents,” she said.

Curran and others pointed to the report’s finding that Hispanics experienced a disproportionate share of layoffs because of their strong representation on the payrolls of tourism and hospitality businesses, which were shut down for more than three months.

For example, restaurants, hotels and other hospitality businesses shed about 65,000 jobs in the pandemic’s first two months, or two thirds of the sector’s total work force. And Hispanics make up 27% of the sector’s work force, the report states.

“This pandemic has caused hundreds of thousands of Long Islanders to lose their jobs, shuttered businesses, and turned our local economy upside down,” Bellone said. “This economic devastation will be extended for more than a decade if the federal government doesn’t provide disaster aid to our region.”

The report predicts it will take two years for restaurants, hotels, tourist attractions, warehouses, recreation businesses and arts organizations to rebound, and even then they will have 25% fewer employees than before the virus struck. 

Faring somewhat better, with a recovery period of one year, is a group that includes real estate agents, retail stores, farms, construction, utilities, health care, education, manufacturing and trade companies. Still, 15% of those jobs will be permanently lost, the report states.

The quickest recovery — six months — will occur in the sector that includes finance, insurance, information, professional and technical services, and government, with only a 5% reduction in total employment.

“Recovery will occur in waves, with the starting point and duration differing by industry depending on public policy interventions, industry adaptivity, firm-worker dynamics and business size,” the report states.

The report, costing up to $130,000, was paid for by the counties’ industrial development agencies using fees collected from developers. Among those contributing research were Hofstra University, the developers’ group Association for a Better Long Island, and the HIA-LI.

The report provides further evidence for economists’ predictions that the recession won’t end quickly, said Steven Kent, an economics professor at Molloy College and former analyst at the investment bank Goldman Sachs in Manhattan.

“This analysis suggests a rapid v-shaped recovery is unlikely on Long Island; it’s going to take a couple of years and resemble the Nike Swoosh logo,” he said on Thursday. “We’ve had a dramatic dip in economic activity, faster than any other economic downturn. So, the recovery is going to take some time.”

Read it on Newsday’s website.

As prudent business owners know, the distinction between employees and independent contractors is critical to ensure that employers are handling unemployment insurance, taxes, health insurance, workers’ compensation insurance, and other matters properly. Misclassification of an employee as an independent contractor (rather than as an employee) can lead to years of penalties, fines, back payments being assessed, and other problems against employers. That’s the situation our client, a technology company in the education space, found itself in when an individual the company treated only as an independent contractor alleged in an unemployment insurance filing that she was actually an employee.

Given that this individual had agreed in writing before she performed service that she was an independent contractor and not an employee, our client thought the unemployment claim would be denied outright. Unfortunately for our client, the New York State Department of Labor (“DOL”) agreed with the individual, and found she was an employee entitled to unemployment benefits. The DOL then sought to expand the issue, and attempted to go back nearly five years to retroactively declare that all the company’s independent contractors were really employees and to collect employer taxes on all payments to them from 2016 to the present (and going forward). That’s when the company turned to CMM to challenge that decision.  

Determining whether an employer-employee relationship exists involves an assessment of the extent to which the supposed “employer” exercised control over the results of the individual’s work and, more importantly, the means by which those results are produced. CMM’s Christine Malafi and David Green defended the company’s position, and the resulting hearing spanned numerous days, where CMM adduced testimony and evidence demonstrating that this individual was in total control of her own schedule, had the freedom to accept or decline all or any assignments, and that she worked independently, with the company only ensuring proper services and compliance with regulations and laws in the performance of those services – all of which, CMM argued, pointed to an independent contractor relationship.

CMM’s efforts paid off. In a major victory for our client, the Administrative Law Judge found “insufficient indicia demonstrating the requisite level of supervision, direction, and control to be an employer” – essentially, that the individual (as well as the hundreds of other individuals in the same position) was an independent contractor, not an employee.

“Thank you so much for your direction and guidance throughout this process,” the client wrote to CMM upon learning of the result. “We are elated with the outcome.”

If your business is facing an investigation by the Department of Labor (DOL) or other government agency, please reach out to our Labor & Employment team for guidance. We have helped countless businesses move forward. Learn more here.

CMM’s Labor & Employment team has secured the dismissal of a complaint filed against its client, a Suffolk County technology manufacturer.

Months after quitting his job with the company, a former employee filed a complaint with the New York State Division of Human Rights, charging the employer with discriminatory practices. The manufacturing company, a longtime CMM client, turned to us for guidance. After reviewing the facts, CMM’s Christine Malafi and Vincent Costa submitted a position statement strongly denying the allegations, based on significant evidence that disproved all claims of discrimination.

In a major win for our client, the Regional Director of the State Division of Human Rights agreed with CMM, stating: “After investigation, and following opportunity for review of related information and evidence, the Division has determined that there is no probable cause to believe that the employer has engaged in or is engaging in the unlawful discriminatory practice complained of.” CMM’s review of the facts and strong position statement based on the evidence ultimately convinced the Division of Human Rights to dismiss the complaint.

If your business is facing an investigation by the Department of Labor (DOL), Division of Human Rights, or other government agency, please reach out to our Labor & Employment team for guidance. We have helped countless businesses move forward. Learn more here.

By Adina Genn, Long Island Business News

As Long Island reopens amid the COVID-19 pandemic, experts say a skilled and well-trained workforce, coupled with racial equality, would go a long way towards an inclusive economy.

That’s according to the Long Island Regional Planning Council and the Suffolk Industrial Development Agency, which this week released the findings of its study, “Upskilled: Preparing the Long Island Workforce for the Future.”

“The report outlined the opportunities and strategies for the next chapter of workforce training and development on Long Island,” LIRPC Chairman John Cameron said in a statement.

“Long Island has an overdue need to create a unified strategy to upskill the region’s workforce and create true economic opportunity,” he added. “Responding to the realities of the post-pandemic world and the workforce impact on Long Island intensified these needs.”

With the region’s challenges comes an “unprecedented opportunity” to “implement a workforce training and development strategy to meet current and future market demand with an exceptional workforce, drive the region’s growth and global competitiveness, and help bridge the economic divide,” according to a press release from the LIRPC.

Workforce development has been a priority of Gov. Andrew Cuomo, who, prior to the economic constraints set forth by the pandemic, said he was putting $175 million towards this initiative as a statewide priority for economic growth.

LIRPC commissioned the report from James Lima Planning + Development, a New York-based firm that has advised major Silicon Valley companies on building out their campuses and ecosystems. The firm undertook economic and demographic research to set the stage for high-impact regional workforce development to ensure the skills of the area’s workers match the talent needs of the region’s fastest-growing business sectors.

“The pandemic is testing our nation’s economic strength, and Long Island is not immune to these challenges,” Kelly Morris, deputy executive director of the Suffolk IDA said in a statement.

This is the report’s first phase. Its second phase is slated to include an implementation strategy, covering multiple recommendations such as location, size and scale, facility type, academic partners, funding, curriculum, and operating budget.

Morris said that the IDA and its economic development partners on Long Island and across the state are making a “concerted effort in the area of workforce development for quite some time. This report is a major step forward in informing the process to ensure we are providing our innovation economy with diverse and skilled workers, and subsequently, guaranteeing we reach new heights post-pandemic.”

Here are key findings from the report:

• Focus on workforce development in “tradable sectors,” which export goods and services to other regions. Tradable sectors are critical for economic development by bringing new dollars into the region, providing better-paying jobs, and defining a place’s competitive advantages. Only 23 percent of Long Island’s workforce is employed in tradeable sectors today. The eight key tradeable sectors identified for growth on Long Island are aerospace, biopharma, business services, construction, distribution, financial services, food processing, and IT and instruments.
• With 77 percent of the current workforce employed in local services, provide significant retraining opportunities to build a sufficient pipeline for the high-growth industries in tradeable sectors.
• As Long Island’s population becomes more diverse, workforce development can offer a solution for equitable economic development, preparing all Long Islanders for career trajectories with good earnings potential, regardless of age and ethnic or educational backgrounds.
• This report envisions economic and workforce development as a unified strategy that thrives on multi-institution, cross-sector, and bi-county collaborations.

Local stakeholders gave the findings high marks.

“As we work to recover from the COVID-19 pandemic there has never been a greater need for investments in workforce development and training to provide greater opportunity for workers and bring our economy back stronger than ever,” Suffolk County Executive Bellone said in a statement. “This report outlines a clear path forward to achieving our goals of a vibrant, diversified economy that focuses on equal opportunity for all.”

“Long Island’s need for workforce development is tremendous,” Theresa Sanders, president and CEO of the Urban League of Long Island, said in a statement.

Sanders is also the LIRPC board secretary, and a member of the New York Forward Re-Opening Advisory Board for Long Island.

“Working collaboratively to address our opportunities in workforce development will not only help us recover from the pandemic economic challenges, but also strengthen the region to ensure we are well-positioned with programs that create better jobs and career paths while lifting all demographics economically,” she said.

“The demand for workers in sectors like advanced manufacturing, technology, and energy — where technology is rapidly changing and hands-on training is critical — far exceeded our capability to deliver work-ready candidates before COVID,” Rosalie Drago, commissioner of Suffolk’s Department of Labor, Licensing and Consumer Affairs.

“Those industries continue to hire even now and the need to accelerate time to get people into the workforce is even greater,” she added. “Having a space where industry and education can collaborate, train and incubate talent is essential to recovery.”

“This report will play a significant role in shaping an inclusive, long-term workforce development strategy for our region,” HIA-LI President and CEO Terri Alessi-Miceli said in a statement.

“The HIA-LI endorses this study’s focus on the promotion of ‘tradable’ industries,” she added. “Fifty-eight percent of the business done at the Long Island Innovation Park at Hauppauge represents tradable sectors, which is more than double the regional average. We stand ready to help expand the overall ratio of tradable businesses across Long Island.”

“When a region is preparing for long-term economic success, it is imperative to attract and retain knowledge workers,” Joe Campolo, board chairman of HIA-LI and managing partner of Campolo, Middleton & McCormick, said in a statement.

“Long Island is competing with regional economies nationwide to attract and fortify a number of key industry clusters,” he added. “Workforce development efforts will help ensure our most vital sectors can tap this talent and ensure Long Island’s future.”

“It is critically important for Long Island’s future that we align workforce development with industry needs and increase our involvement in high-growth tradable sectors to propel economic prosperity for everyone,” LIRPC Executive Director Richard Guardino said in a statement. “Further, as we focus on economic recovery from the pandemic, the report provides a ‘shovel-ready project’ to help fast-track our way to a vibrant economy.”

“As organizations and communities continue to adapt to the social and economic implications of COVID-19 and racial injustice, this report can inform regional efforts to protect, prepare, grow, and upskill the region’s workforce, one of the most important assets of Long Island’s economy,” James  Lima, president of James Lima Planning + Development, said in a statement.

The report’s release was the next step toward the development and implementation of a workforce development plan for Long Island. The report’s principles will guide programmatic and policy decisions, opportunities of actionable next steps, and components that illustrate productive configurations of the regional workforce development system.

Read it on LIBN.

On June 5, the Suffolk County Bar Association made history with its first-ever virtual installation, swearing in the Honorable Derrick J. Robinson as the 112^th President of the SCBA.

Judge Robinson’s legal scholarship and skills will serve him well during the next year. A former New York State Assistant Attorney General and a founding president of the Amistad Long Island Black Bar of Long Island, he is looking forward to this new endeavor.

The Oath of Office was administered by his dear friend Supreme Court Justice William G. Ford. He plans to work this year in a cooperative spirit with his fellow officers and the members of the Board of Directors to focus on members and membership.

Along with Judge Robinson, new Officers and Directors were sworn in who will move SCBA forward during these critical times.

Incoming Officers:

Daniel J. Tambasco: President Elect

Vincent J. Messina, Jr.: First Vice President

Cornell V. Bouse: Second Vice President

Patrick McCormick: Treasurer

Hon. John J. Leo: Secretary

Incoming Directors:

Jarrett M. Behar

Catherine E. Miller

David R. Okrent

Daniel A. Russo

Oath of Office administered by:

Hon. Hector D. LaSalle, Associate Justice

Supreme Court of the State of New York

Appellate Division, Second Judicial Department

CMM congratulates Hon. Robinson and all the incoming Officers and Directors!

Neighbors Oppose Long Island Innovation Park Apartments

by Nicholas Spangler

A Smithtown proposal to rezone part of the Long Island Innovation Park at Hauppauge for mixed-use projects that could include apartments sparked an hourslong clash in an online public hearing.

The bill would permit buildings that mix commercial, office and residential uses on 13 of the industrial park’s 450 parcels that are seven acres or larger. Smithtown Supervisor Edward Wehrheim has said rezoning would allow developers to build up to 1,000 apartments, though a spokeswoman said the actual number was likely to be lower. No developers have submitted applications and some of the buildings on eligible parcels have tenants under lease or are owner-occupied. 

“We can pay more taxes or encourage economic development to offset those taxes,” Joe Campolo, chairman of the Hauppauge Industrial Association of Long Island, which represents businesses in the park and supports the legislation, said at the hearing Thursday. 

But some current residents of neighborhoods near the 1,650-acre park said rezoning would add traffic and burden local schools. “It’s not an area that was ever designed or meant for people to live in,” said one man who described himself as a 30-year resident. 

Thomas Kriklava, operations manager for the Central Islip-Hauppauge Volunteer Ambulance Company said department officials had “serious reservations about this project,” but he did not elaborate or respond to a voicemail. 

David Barshay, president of the Hauppauge school district board of education, asked for legislation to be delayed. “Give us time to figure out whether we can even absorb” children who might live in the apartments, he asked. The district, which faces a budget shortfall of more than $2 million this year, spends more than $20,000 per student, he said. 

Supporters say that at full build-out apartments would add about 90 children to a school district that has lost hundreds more than that in past years and that the benefits of new development outweigh the costs of increased demand for services. A 2019 study by the Real Estate Institute at the Stony Brook University College of Business of 14 apartment complexes found public school enrollment increased by less than one student per 11 apartments.

Apartments and park residents are central to a plan backed by park stakeholders and town officials to attract new businesses in areas like electronic commerce and financial services which they say would create high-paying jobs and tax receivables. 

“They are the engine,” said James Coughlan, a principal in Tritec, an East Setauket-based real estate firm that could redevelop one of its buildings under the proposed legislation.

New residents would supply a built-in customer base for retail; amenities built to serve them like green spaces and walkways, along with the promise of a quick commute, would also attract new firms looking for perks for their own workers.

Campolo envisioned market-rate rents for one-bedroom apartments starting at $2,500. At least 20% of the apartments would be designated as workforce housing, with rents pegged to area median income. 

The park generates $19 million in tax receivables annually for the town and $45 million for the school district, keeping hamlet residents’ property taxes among the lowest in Suffolk County.

But about 60 of its parcels are vacant and 314 are used for warehouses or storage, and Coughlan said finding tenants had grown harder over the past five years. That problem could be exacerbated by the pandemic and competition from projects like the Ronkonkoma Hub, he said. “There’s going to be a new paradigm for where people want to work,” he said.

Any project proposed under the bill would need multiple town approvals and would have to meet design criteria to be considered for a special exception by the Town Board.

Complaints by some residents last week that advertisements for apartments for rent indicated projects at the Hauppauge park were already approved may be tied to a Willets Path sign that in fact advertises apartments in Melville, town spokeswoman Nicole Garguilo said. No projects are underway and the public hearing for the rezoning bill will stay open for three weeks to allow further written public comment, she said.

Town leaders also conducted two less contentious public hearings at the May 21 town meeting, held over Zoom. They were the first such hearings in town history and Garguilo said 400 people watched or listened, more than at any in-person meeting in the past four years. 

Anthony Coates, a Head of Harbor resident and civic leader, and We Are Smithtown civic association president James Bouklas said the hearing should have been delayed until in-person meetings are possible and criticized town leaders for pushing through what Coates called the “Queensification of Smithtown.” 

Read it on Newsday’s website here.