NYAG: St. Clare's pension collapse was avoidable
September 06, 2019 06:53 PM
Almost two years ago, St. Clare's Corporation directors agreed to buy insurance for the hospital's pension plan, but never followed through.
Documents provided by the New York State Attorney General's office offer a potential reason why the plan was never purchased.
In October 2017, board directors voted unanimously to purchase ERISA (Employee Retirement Income Security Act) coverage. Though in order to get that coverage, the corporation would have to decide if they wanted to "expose themselves to liability or litigation risk by obtaining such insurance."
Details of the discussion that followed were heavily redacted when the minutes were handed over to the AG's office.
Board members were then asked if they wanted to change their answers regarding obtaining ERISA insurance. The documents from the AG said no board members changed their minds, but the insurance was still never purchased.
Of course, we now know the failure to obtain that insurance lead to 1,100 people losing at least part their pensions. The AG's office is still investigating, but said the pension fund would have been in much better shape if the insurance had been purchased in 2017.
The AG's office is now asking the judge to remove trustees from their positions and appoint new ones.
Albany Law School professor David Pratt is one of the attorneys advising retirees. Pratt said attorneys for St. Clare's Corporation have also filed motions to prevent pensioners from attending the hearings regarding the petition to dissolve.
Assemblyman Angelo Santabarbara represents many of the pensioners and has been outspoken against the corporation from the get go.
"You start to think, okay what are you hiding? Why don't you want to provide the documents? Why are you trying to stop these voices from being heard?" Santabarbara asked.
Santabarbara and Senator Jim Tedisco (R – Glenville) pushed for funding in the state budget earlier this year, but were unsuccessful.
The New York State Department of Health contributed over $28 million to the fund about a decade ago to help with depleting pension plan funding.
Mary Hartshorne is a St. Clare's retiree. She recently met with Bishop Edward Scharfenberger to talk about other possible sources of funding.
Hartshorne said the bishop is working hard to find a way to help them, but hasn't been able to make anything official yet.
"I feel like he's hit a wall and I think he has mentioned that. I don't think he's the last one to speak to," Hartshorne said. "So we keep expecting something from him and I think that's a little unfair because he doesn't have the last word."
NewsChannel 13 reached out to the Roman Catholic Diocese of Albany for comment but did not hear back.
On Friday, both Santabarbara and Hartshorne said they were disappointed in the lack of response from Governor Andrew Cuomo.
Jason Conwall, spokesman for Governor Cuomo sent NewsChannel 13 this comment on Friday evening:
"We support the Attorney General's efforts and strongly encourage the St. Clare's Corporation to fully cooperate with the investigation. These employees deserve answers and accountability from the St. Clare's Corporation, not more uncertainty and evasive actions."
It's unclear how long the AG's investigation into St. Clare's Corporation will last. In the meantime, Hartshorne said she and the other pensioners are going to keep looking out for one another.
Updated: September 06, 2019 06:53 PM
Created: September 06, 2019 06:38 PM
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