Gifts for departing teachers must be of ‘nominal’ value
On Board Online • Legal Agenda • June 30, 2008
By the New York State Association of School Attorneys
At the end of the school year, as teachers retire and some school board members leave public service, school districts may wish to recognize individuals with mementos such as pens or plaques. May districts spend public funds for such gifts? The answer is yes, as long as the memento is of nominal value.
Article VIII of the New York State Constitution generally prohibits the expenditure of public funds for the benefit of a private party unless it is in furtherance of a proper public purpose and is undertaken pursuant to an express statutory provision or properly authorized contract under which the school district receives fair and adequate consideration.
This provision has been interpreted as prohibiting municipalities and school districts from spending money to provide gratuitous or unduly expensive benefits to individuals. For instance, in 1973 the state’s highest court, the Court of Appeals, ruled in Antonopoulou v. Beame that school district funds may not be used for graduation pins, a flower for each pupil and other graduation expenses where the total cost would be substantial.
The state comptroller issued an opinion in 1999 regarding the specific case of a school district expending public funds to celebrate an employee milestone. The comptroller said that “municipalities and school districts have implied authority to present officers or employees tokens of appreciation, such as years of service pins and medals, plaques or other similar mementos of nominal value, to recognize long and faithful service.”
The case involved the Unatego Central School in Ostego County, which wanted to pay to frame a cancelled bond issued by the school district and present it to a retiring teacher as a token of appreciation for service. The comptroller determined that as long as the frame was of nominal value and the framed bond was presented as part of a personnel management program, the school district would not violate Article VIII’s restrictions concerning the expenditure of public funds for private purposes.
The comptroller said there is no constitutional violation if any benefit to an employee or an officer (such as a school board member) would be incidental to the purpose of recognizing long-time service to the school district.
The obvious question that arises is what constitutes a nominal expense and what constitutes a significant expense. While legal authorities have not defined a “nominal amount” in today’s dollars, $50 should serve as a good benchmark However, if 20 teachers were retiring at one time and each was awarded a $50 gift, and a resident challenged the legality of the package of gifts, the $1,000 expense might be viewed as substantial.
If there is any doubt whether a proposed expenditure for a longevity gift is constitutional, the wiser course of action would be to avoid making such an expenditure.
Members of the New York State Association of School Attorneys represent school boards and school districts. This article was written by Ethan Balsam, an associate attorney at Ingerman Smith LLP. For more information on school attorneys, visit nyasa.org.
Show Other Stories