Mineola, NY - The Rules Committee of the Nassau County Legislature led by the Democratic majority, adopted a plan of action this week that saves the financially troubled Legal Aid Society through an infusion of funds and establishment of safeguards to ensure the Society is operating in a responsible manner.

In addition, the Democratic majority recommended an overhaul of the Society, which was the subject of an audit by the County Comptroller from 1993-1995. That audit found questionable practices and irregularities that resulted in a $1.2 million debt. While copies of the audit were sent to the County Executive, District Attorney and other county officials, no investigative action was taken at the time and the Society continued to over-spend and borrow money to operate from European American Bank. However, once EAB was acquired by Citibank, the bank refused to continue to loan the money and called in the $1.2 million already owed.

The Democratic majority became aware of Legal Aid Society's problems after its attorney-in-chief Matthew Muraskin abruptly resigned earlier this month and the board notified the county it needed $900,000 to continue to operate beyond August 24. With no funds and unable to secure a bank loan, Legal Aid Society - which is operated as a state mandate - would have been unable to provide legal aid to the indigent clients it serves. Costly 18B lawyers would have had to step in to handle the workload at a much higher cost than Legal Aid Society, thereby thrusting an additional financial burden on the already fiscally strapped county.

Through meetings and negotiations, the Democratic majority was able to secure a commitment from board members of the Legal Aid Society that cost-saving measures, oversight, and other safeguards would be implemented. Following through on the majority's recommendations, the County Executive suggested a 10-point plan for remedial action. Adopting the plan provided the Legal Aid Society with a "good faith" commitment from the county and the bank agreed to loan the Society the funds needed to operate beyond August 24.

"Unfortunately, the situation with Legal Aid Society is just another example of the kind of mismanagement that was allowed to continue in Nassau County without any one being accountable. The County administration knew about the problems in 1996 after Parola released his audit covering 1993-1995 and nothing was ever done about it," said Legislator Patrick Williams (D-Uniondale) on behalf of the Democratic majority. "It is only through the diligent efforts of our caucus that those individuals most in need of the services Legal Aid Society provides will have their day in court."

Some of the amendments to the county's contract with Legal Aid Society include:

• a multi-year term (five years);
• Legal Aid would be required to save at least $300,000 in each contract year to reduce its operating deficit;
• the county would commit to transfer $400,000 to Legal Aid by the end of fiscal year 2001;
• Legal Aid would receive the first half of its $3.8 million allocation from the county in January 2002 in order to reduce outstanding indebtedness from the prior fiscal year and avoid incurring additional interest expense;
• Legal Aid would be required to report quarterly to the Comptroller, the Commissioner of Accounts and the County Legislature as to compliance with its budget and to assure no expenditures outside of budget;
• Legal Aid would agree that there be no new hiring or pay increases unless or until it is clear that their budget can accommodate the expense;
• Legal Aid would be required to establish a finance committee of the Board of Directors.

The Rules only contract was unanimously adopted by the Rules Committee 9-0 at the August 20, meeting of the Nassau County Legislature.