News (All)

First time’s the charm for CMM’s Richard DeMaio, who argued his first appeal in the Appellate Division, Second Department, and won! The Court’s decision is a spectacular outcome for our client, a Village on the East End, and demonstrates why municipalities turn to CMM for guidance with all aspects of their operations.

The appeal concerned the 2017 denial of a homeowner’s application for an area variance by the Village’s Zoning Board of Appeals (ZBA) with respect to lot size. The homeowner challenged the denial in Suffolk County Supreme Court via an Article 78 petition, but the Court denied the petition and dismissed the proceeding. Trying once more, the homeowner – seeking to subdivide the property into two lots – appealed that decision to the Appellate Division, Second Department, which sits in Brooklyn.

Under the guidance of CMM Senior Partner Scott Middleton, DeMaio drafted the appellate brief, outlining why the Supreme Court’s decision should be upheld on appeal. In his first oral argument before the Appellate Division, DeMaio argued that the Supreme Court properly found that Village’s denial of the variance application had a rational basis, because allowing a second lot on a property of less than the square footage set forth in the Village Code would cause an undesirable change in a neighborhood characterized by lots much larger than required by the Code. In its decision, the Appellate Division agreed, noting that the ZBA “engaged in the required balancing test and considered the relevant statutory factors.” Moreover, the Court noted that the homeowner was presumed to have known about the applicable zoning restrictions when he purchased the property, and therefore, any hardship was “self-created.”

This result is a major win for the Village, supporting its ability to make zoning decisions that preserve its character. Learn more about our Municipal and Appeals practices and call us at (631) 738-9100 for guidance.

The Guide Dog Foundation and its sister organization, America’s VetDogs, have announced the election of Joe Campolo to serve on the executive committee of the boards of directors. The executive committee oversees each board, providing counsel and oversight to advance the organizations’ missions to provide guide and service dogs and training – free of charge – to people who are blind or have low vision, and to those who have served our country honorably. Members of the boards of directors develop strategies and policies as well as ensuring proper resources are available to carry out its mission, monitor the finances of the organizations, its programs, and performance.

Joe Campolo is the managing partner of Campolo, Middleton & McCormick, LLP, recognized by Forbes as a Top Corporate Law Firm in America. He has spearheaded some of the most important initiatives in recent years to grow the regional economy and is the chairman of the HIA-LI board of directors. As a veteran of the United States Marine Corps, he is passionate about veterans and veteran’s causes. 

“Joe has played an integral role on our board and I’m thrilled to have him join our executive committee,” said John Miller, president and CEO of the Guide Dog Foundation and America’s VetDogs. “He has brought a wealth of experience and expertise in his field to our organizations and has embraced our mission to assist individuals with disabilities. With his strong background in leadership, Joe will be an asset on our executive committee as we further our missions.”

The Guide Dog Foundation and America’s VetDogs boards of directors comprise volunteer leaders from the medical, business, academic, and military and veteran communities. Members of the boards of directors set strategic direction and policy, and help raise awareness of the organizations’ services.

View Campolo’s recent discussion with Miller on “Business Unusual,” Campolo’s weekly business recovery webinar, here.

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.