text:
    [664 NE2d 1218, 642 NYS2d 156]
    In the Matter of New York City Department of Sanitation et al., Appellants, v Malcolm D. MacDonald, as Chairman of the New York City Board of Collective Bargaining, et al., Respondents.
    Argued February 13, 1996;
    decided March 26, 1996

      POINTS OF COUNSEL

      Paul A. Crotty, Corporation Counsel of New York City (Elaine R. Witkoff and Larry A. Sonnenshein of counsel), for appellants.
    The transfer of an employee who has not been served with written charges of incompetency or misconduct pursuant to section 75 of the Civil Service Law is not a disciplinary action under article VI, § 1 (e) of the subject collective bargaining agreement, but rather a proper exercise of the Department’s managerial prerogative to deploy personnel, and absent a clear and unequivocal agreement to arbitrate such a matter, is not arbitrable. (Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. [United Liverpool Faculty Assn.], 42 NY2d 509; Matter of Niagara Wheatfield Admr’s Assn. [Niagara Wheatfield Cent. School Dist.], 44 NY2d 68; Matter of South Colonie Cent. School Dist. [South Colonie Teachers Assn.], 46 NY2d 521; Matter, of County of Rockland v Rockland County Sheriff s Deputies Assn., 211 AD2d 787; Matter of Gibson v County of St. Lawrence, 199 AD2d 910; Board of Educ. v Depew Teachers Org., 167 AD2d 906, 907, 77 NY2d 889; County of Monroe v Monroe County Deputy Sheriff’s Assn., 155 AD2d 874; Matter of City of Newburgh v Local 589, 140 AD2d 339, 72 NY2d 808; Matter of Board of Educ. v Levittown United Teachers, 60 AD2d 629; Board of Educ. v Barni, 49 NY2d 311.)

      Victoria A. Donoghue, New York City, and Wendy E. Patitucci for Malcolm D. MacDonald and another, respondents.
    I. Under the applicable standards of judicial review, the determination of an administrative agency is to be upheld unless it is arbitrary and capricious or contrary to law. (Matter of Levitt v Board of Collective Bargaining, 79 NY2d 120; Matter of City of New York v Plumbers Local Union No. 1, 204 AD2d 183, 85 NY2d 803; Matter of Medical Malpractice Ins. Assn, v Superintendent of Ins., 72 NY2d 753, 490 US 1080; Matter of Board of Educ. v New York State Pub. Empl. Relations Bd., 75 NY2d 660; Matter of West Irondequoit Teachers Assn. v Helsby, 35 NY2d 46; Matter of Incorporated Vil. of Lynbrook v New York State Pub. Empl. Relations Bd., 48 NY2d 398; Uniformed Firefighters Assn. v City of New York, 79 NY2d 236.) II. The Board’s threshold arbitrability test is rationally based and consistent with applicable legal precedent. (Matter of Nationwide Gen. Ins. Co. v Investors Ins. Co., 37 NY2d 91.) III. The "express, direct and unequivocal” standard set forth in Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. (United Liverpool Faculty Assn.) (42 NY2d 509) for determining arbitrability does not apply in the instant case because Administrative Code of the City of New York § 12-302 expresses a policy favoring arbitration of grievances and because, in cases decided subsequent to Liverpool, the Court of Appeals has applied a less stringent standard. (Board of Educ. v Barni, 49 NY2d 311; Matter of Board of Educ. v Watertown Educ. Assn., 74 NY2d 912; Board of Educ. v New York State United Teachers, 51 NY2d 994; Matter of Franklin Cent. School [Franklin Teachers Assn.], 51 NY2d 348; Matter of Deer Park Union Free School Dist. v Deer Park Teachers Assn., 50 NY2d 1011; Matter of Wyandanch Union Free School Dist. v Wyandanch Teachers Assn., 48 NY2d 669; Board of Educ. v Glaubman, 53 NY2d 781; Board of Educ. v Bellmore-Merrick United Secondary Teachers, 39 NY2d 167; Matter of Susquehanna Val. Cent. School Dist. [Susquehanna Val. Teachers’ Assn.], 37 NY2d 614.) IV. In Decision No. B-12-93, the Board’s determination that the grievance alleged by the union was within the scope of the arbitration provision was rational. V. The Board’s decision that the grievance alleged by the union was within the scope of the arbitration provision was neither arbitrary and capricious nor contrary to law. (Matter of Board of Educ. v Arlington Teachers Assn., 78 NY2d 33; Matter of Enlarged City School Dist. v Troy Teachers Assn., 69 NY2d 905; Matter of Board of Educ. v New York State Pub. Empl. Relations Bd., 75 NY2d 660; Binghamton Civ. Serv. Forum v City of Binghamton, 44 NY2d 23; Matter of Auburn Police Local 195 v Helsby, 62 AD2d 12, 46 NY2d 1034; Steelworkers v American Mfg. Co., 363 US 564.) VI. An argument not raised in the proceeding before the Board or the lower court may not be the subject of judicial review. (Matter of Hennekens v State Tax Commn., 114 AD2d 599.)

      Robin Roach, New York City, and Robert Perez-Wilson for District Council 37, Local 375, AFSCME, respondent.
    I. The courts below properly deferred to the Board’s determination in accordance with the appropriate standard of review of administrative decisions. (Matter of West Irondequoit Teachers Assn. v Helsby, 35 NY2d 46; Matter of Incorporated Vil. of Lynbrook v New York State Pub. Empl. Relations Bd., 48 NY2d 398; Matter of Newark Val. Cent. School Dist. v Public Empl. Relations Bd., 83 NY2d 315; Matter of Board of Educ. v New York State Pub. Empl. Relations Bd., 75 NY2d 660; Matter of Levitt v Board of Collective Bargaining, 79 NY2d 120; Matter of City of New York v Plumbers Local Union No. 1, 204 AD2d 183, 85 NY2d 803; Matter of Caruso v MacDonald, 169 AD2d 644.) II. The applicable statute and case law favor the arbitrability of grievances. (Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. [United Liverpool Faculty Assn.], 42 NY2d 509; Board of Educ. v Associated Teachers, 30 NY2d 122;
      Board of Educ. v Barni, 49 NY2d 311; Matter of Board of Educ. v Watertown Educ. Assn., 74 NY2d 912; Board of Educ. v Glaubman, 53 NY2d 781; Matter of South Colonie Cent. School Dist. [South Colonie Teachers Assn.], 46 NY2d 521; Matter of County of Rockland v Rockland County Sheriff’s Deputies Assn., 211 AD2d 787; Matter of Board of Educ. [Connetquot Teachers Assn.], 60 NY2d 840; Matter of Port Wash. Union Free School Dist. v Port Wash. Teachers Assn,, 45 NY2d 411; Matter of Board of Educ. v Yonkers Fedn. of Teachers, 143 AD2d 1010.) III. The Board correctly applied its balancing test that weighs the interest of management against those of the employees and found that a punitive transfer is arbitrable.
   OPINION OF THE COURT

Bellacosa, J.

The New York City Board of Collective Bargaining determined that an alleged employee disciplinary grievance was subject to arbitration. The lower courts upheld the Board’s determination and concluded that it did not impinge on public policy. The New York City Department of Sanitation appeals to this Court by our grant of leave to appeal. The issue presented is whether the Board’s determination of arbitrability offends public policy and whether it is otherwise sustainable.

Richard Diamond was employed by the Sanitation Department as a project manager of a facility in Maspeth, Queens. His civil service title is Civil Engineer, and he is a member of District Council 37, Local 375, AFSCME. In November 1991, Diamond wrote a letter to the Director of Construction complaining about certain personnel assignments and work procedures, which he claimed were being implemented without his approval or consultation. The grievance alleges that the Director responded by calling Diamond an "incompetent” and told him that he would soon be transferred to the Department’s facility at the Fresh Kills Landfill on Staten Island (approximately 20 miles from the Maspeth facility). On or about November 19, 1991, Diamond was transferred from Maspeth to Fresh Kills and, subsequently, on November 21, Diamond met with his immediate supervisor and the Director to discuss the transfer. During this conversation, the Director is claimed to have again stated that Diamond was transferred because he was an "incompetent.”

Respondent District Council 37 filed a grievance on behalf of Diamond with the New York City Office of Labor Relations, alleging that Diamond’s transfer was an "improper and punitive transfer” violating article VI, § 1 (b), (e) and (f) of the collective bargaining agreement between the union and the City. The grievance was denied on the ground that the transfer was a business necessity. The union appealed the decision to the Deputy Chief Review Officer of the Office of Labor Relations, and the grievance was again rejected on the grounds that the transfer was not punitive but an exercise of the Department’s prerogative to staff and manage operations and that the union had failed to establish that the transfer had violated any of the Department’s rules, regulations or written policies.

The union later filed a Request for Arbitration with the Board of Collective Bargaining. The Board, with two of its seven members dissenting, granted arbitration to the extent of finding that the Union raised a substantial question as to whether Diamond’s transfer was a "disciplinary action” under article VI, § 1 (e) of the collective bargaining agreement. The Board determined that the union had demonstrated a sufficient nexus between Diamond’s transfer and the asserted punitive motivation of his supervisors and, therefore, established a sufficient predicate for arbitration. Additionally, the Board stated that the absence of written charges of incompetence or misconduct did not bar arbitration of Diamond’s claim.

The Sanitation Department initiated this proceeding under CPLR articles 75 and 78 seeking to annul the Board’s decision and permanently stay arbitration. It argued that the dispute was not within the scope of the arbitration clause and that arbitration of the dispute would violate public policy by restricting a municipal employer’s prerogative to deploy and manage its work force. Supreme Court denied and dismissed the Department’s petition, holding that the collective bargaining agreement contained a broad arbitration clause, that it was ambiguous as to whether written charges were a condition precedent to arbitration, and that the issue of the scope of the provision itself was an issue of contract interpretation and, thus, for the arbitrator to decide. The Appellate Division affirmed, holding that the Board’s determination was not arbitrary, capricious or an abuse of discretion. We now affirm and agree that the dispute is arbitrable.

The threshold for determining whether a valid, enforceable agreement to arbitrate exists between public employees and a public agency or entity is well established (Matter of Committee of Interns & Residents [Dinkins], 86 NY2d 478, 484; see also, Matter of Blackburne [Governor's Off. of Empl. Relations], 87 NY2d 660). It "must proceed in sequence on two levels by answering the following inquiries: (1) are arbitration claims with respect to the particular subject matter of the dispute authorized * * * and (2) do the terms of the particular arbitration clause include this subject area?” (Matter of Committee of Interns & Residents [Dinkins], supra, at 484.) The determination of the Board of Collective Bargaining in this matter may not be upset unless it is arbitrary and capricious or an abuse of discretion, as the Board is the neutral adjudicative agency statutorily authorized to make specified determinations (Matter of Levitt v Board of Collective Bargaining, 79 NY2d 120, 127-128; see, Administrative Code of City of NY § 12-309 [a] [3]), or unless arbitration of the dispute offends public policy.

While public policy considerations may limit the rights of public employees to arbitrate their disputes (see, Matter of Cohoes City School Dist. v Cohoes Teachers Assn., 40 NY2d 774, 778), judicial intervention to stay arbitration on public policy grounds is exceptional and itself limited to circumstances specifically identified or rooted in statute or case law (Matter of Enlarged City School Dist. [Troy Teachers Assn.], 69 NY2d 905, 906, citing Matter of Sprinzen [Nomberg], 46 NY2d 623, 631; see also, Board of Educ. v Areman, 41 NY2d 527, 530-531).

We agree with the courts below that no statute or otherwise manifest public policy has been tendered that would bar arbitration of Diamond’s wrongful transfer claim. The Department’s suggestion, that a transfer decision is a nondelegable management function (see, Administrative Code § 12-307) and that the Department, as a public employer, enjoys a public policy presumption under Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. (United Liverpool Faculty Assn.) (42 NY2d 509, 514) that it did not intend such disputes to be resolved in an arbitration forum, is incorrect. In this case, the relevant public policy considerations are not derived from the Taylor Law (Civil Service Law art 14), but rather are located in the New York City Collective Bargaining Law, under which the applicable collective bargaining agreement was negotiated (Administrative Code § 12-301 et seq.-, contrast, Matter of Blackbume [Governor’s Off. of Empl. Relations], 87 NY2d 660, supra).

The Collective Bargaining Law distinctively states that "[i]t is hereby declared to be the policy of the city to favor and encourage * * * on matters within the scope of collective bargaining, the use of impartial and independent tribunals to assist in resolving impasses in contract negotiations, and final, impartial arbitration of grievances between municipal agencies and certified employee organizations” (Administrative Code § 12-302). This express statutory conferral, favoring the arbitration of disputes, invests the Board of Collective Bargaining with the authority to establish and manage dispute resolution proceedings between public employers and public employee organizations (Administrative Code § 12-312). Thus, the most pertinent and manifest public policy applicable here contradicts the Department’s argument on this ground.

The Department nevertheless presses the argument that Administrative Code § 12-307, which delineates the powers reserved to the City in its management capacity, precludes arbitration of this dispute. This Court has previously stated, however, that this statute does not "proscribe permissive bargaining of management prerogatives,” and that the statute does not declare any public policy that the City is not free to waive (City of New York v Uniformed Firefighters Assn., 58 NY2d 957, 958-959). Further, "[although terms and conditions of employment (subject to bargaining) and management prerogatives (exempt from bargaining) may be neatly separated in principle, the practical task of assigning a particular matter to one category or the other is often far more difficult. Indeed, in many instances a matter may partake of both categories, requiring a balancing of the interests involved” (Matter of Levitt v Board of Collective Bargaining, 79 NY2d, at 127, supra).

Applying these principles to the issues raised concerning the employee’s transfer strongly confirms our rejection of the Department’s public policy argument. The underlying dispute contains elements relevant both to the Department’s right to manage its work force and to the employee’s right to be protected from allegedly punitive personnel actions. Public policy derived from the applicable local law favors, rather than bars, the Board’s exercise of its particularized statutory duty to balance these competing interests by allowing for resolution of disputes through alternative mechanisms.

We must next turn to another attack by the Department against the Board’s determination. It argues that the union’s claim is not an arbitrable "grievance” under the terms of the collective bargaining agreement because of a lack of written charges. Article VI, § (1) (e) of the collective bargaining agreement defines an arbitrable "grievance” as a "claimed wrongful disciplinary action taken against a permanent employee * * * upon whom the agency head has served written charges of incompetency or misconduct while the employee is serving in the employee’s permanent title or which affects the employee’s permanent status.” This clause is not a broad arbitration provision such as the one we considered in Board of Educ. v Barni (49 NY2d 311), and to that extent we disagree with the reasoning below, though not with the result. The arbitration clause here does not qualify as a broad type and does not expressly grant the arbitrator the power to determine the scope of substantive provisions of the collective bargaining agreement. Therefore, in reviewing the Board’s interpretation of the scope of this provision, we must look further to whether the Board’s particularized determination comports with the agreed-upon understanding of the parties concerning arbitrability.

The record contains support, based on past practice, for the Board’s application of a two-part test to this particular collective bargaining agreement to determine whether a transfer constitutes a grievance under this type of arbitration clause. First, any party seeking arbitration must allege that there is a factual nexus between the transfer and an asserted wrongful disciplinary action. Second, the grievant must introduce sufficient evidence to establish that there is a substantial issue that the transfer was related to a disciplinary or punitive purpose. The Board asserts that this dual threshold balances management’s right to transfer employees with an employee’s contractual right to arbitrate claimed wrongful disciplinary actions.

In this connection, the Department particularly challenges the Board’s finding of arbitrability on the ground that the employee was not served with written charges and, therefore, is not entitled to arbitration by the plain words of the collective bargaining agreement. Such a unilateral power to forestall invocation of the arbitration recourse is dubious at best as applied here. For in interpreting grievance clauses identical to the one in this collective bargaining agreement, the Board has consistently held that written charges are not a prerequisite to an employee’s arbitration rights, because the requirement for written charges was intended as a shield to protect employees and not as a sword to cut off arbitration (see, Board of Collective Bargaining, Decision No. B-52-89, at 10; Decision No. B-33-90, at 14-15; Decision No. B-33-88, at 17; Decision No. B-9-81, at 10). During the periods that the Board has rendered these decisions, the City and union have signed four collective bargaining agreements without changing the language of the arbitration clause. While the parties could negotiate the elimination of the written charges feature to clarify the arbitrability route, it is equally telling that "it was not irrational * * * to conclude that the parties’ conduct in the past, under similar agreements, demonstrated their intent or expectations. * * * Thus it was not unreasonable to find that by renewing the agreement the parties intended to continue the practice followed in the past” (Rochester City School Dist. v Rochester Teachers Assn., 41 NY2d 578, 583). As both the union and the City acquiesced in the Board’s determinations that disputes involving alleged punitive disciplinary transfers would be arbitrable despite the lack of written charges from the employer, we discern no basis to interfere with the practical implementation of the agreed-upon arbitration remedy and the understanding of the parties.

In sum, the Board’s determination to direct this dispute to be resolved by arbitration comports with specifically apt public policy considerations, does not transgress the particular features of the collective bargaining arbitration clause, and is a rationally supportable ruling.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Kaye and Judges Simons, Titone, Smith and Levine concur; Judge Ciparick taking no part.

Order affirmed, with costs.


source: Caselaw Access Project

author: Ciparick, J.

license: Public Domain

text:
    [664 NE2d 1222, 642 NYS2d 160]
    In the Matter of the Arbitration between Elmer H. Blackburne et al., Appellants, and Governor’s Office of Employee Relations et al., Respondents.
    Argued February 7, 1996;
    decided March 26, 1996

      POINTS OF COUNSEL

      William P. Seamon, Albany, Richard E. Casagrande and Patricia Brown Koenig for appellants.
    The Court below erroneously concluded that arbitration of this dispute would offend public policy and was barred by the parties’ collective bargaining agreement. (Matter of Committee of Interns & Residents [Dinkins], 86 NY2d 478; Matter of Acting Supt. of Liverpool Cent. School Dist. [United Liverpool Faculty Assn.], 42 NY2d 509; Matter of Port Wash. Union Free School Dist. v Port Wash. Teachers Assn., 45 NY2d 411; Felá v United States, Merit Sys. Protection Bd., 730 F Supp 779; Binghamton Civ. Serv. Forum v City of Binghamton, 44 NY2d 23; De Paulo v City of Albany, 49 NY2d 994; Board of Educ. v Associated Teachers of Huntington, 30 NY2d 122; Board of Educ. v Areman, 41 NY2d 527; Matter of Board of Educ. v Yonkers Fedn. of Teachers, 143 AD2d 1010, 73 NY2d 707.)

      Dennis C. Vacco, Attorney-General, Albany {Peter G. Crary, Victoria A. Graffeo and Peter H. Schiff of counsel), for respondents.
    The public policy of this State, derived from Constitution and statute, absolutely prohibits arbitration of this dispute concerning petitioner’s Hatch Act termination. (Matter of Committee of Interns & Residents [Dinkins], 86 NY2d 478; Board of Educ. v Areman, 41 NY2d 527; Matter of Acting Supt. of Liverpool Cent. School Dist. [United Liverpool Faculty Assn.], 42 NY2d 509; Matter of Port Wash. Union Free School Dist. v Port Wash. Teachers Assn., 45 NY2d 411; Matter of Cohoes City School Dist. v Cohoes Teachers Assn., 40 NY2d 774; Matter of Citizens for Orderly Energy Policy v Cuomo, 78 NY2d 398; City of Amsterdam v Helsby, 37 NY2d 19; Matter of Fink v Cole, 302 NY 216; South Dakota v Dole, 483 US 203; Oklahoma v Civil Serv. Commn., 330 US 127.)

      Bernard F. Ashe, Albany, Rocco A. Solimando and Kevin H. Harren for New York State United Teachers, amicus curiae.

    I. The parties’ dispute is encompassed by their agreement to arbitrate. (Matter of South Colonie Cent. School Dist. [South Colonie Teachers Assn.], 46 NY2d 521; Board of Educ. v Glaubman, 53 NY2d 781; Matter of Board of Educ. v Deer Park Teachers Assn., 50 NY2d 1011; Mineola Union Free School Dist. v Mineola Teachers Assn., 46 NY2d 568.) II. Public policy does not preclude arbitration of the parties’ dispute. (Board of Educ. v Christa Constr., 80 NY2d 1031; Matter of Sprinzen [Nomberg], 46 NY2d 623; Hackett v Milbank, Tweed, Hadley & MCloy, 86 NY2d 146; Matter of Committee of Interns & Residents [Dinkins], 86 NY2d 478; Matter of Port Wash. Union Free School Dist. v Port Wash. Teachers Assn., 45 NY2d 411.)
   OPINION OF THE COURT

Ciparick, J.

The Hatch Act, 5 USC § 1501 et seq., bars employees of any State agency that is "financed in whole or in part by loans or grants made by the United States or Federal agency” from running for elective office (5 USC § 1501 [4]; § 1502 [a] [3]). A violator is subject to discharge from employment (see, 5 USC § 1505 [2]; § 1506). If removal is warranted, the governmental employer must impose that sanction or subject itself to the loss of Federal funds equivalent to two years of the violator’s salary (see, 5 USC § 1505 [3]; § 1506 [a]).

Petitioner Elmer H. Blackburne violated the Hatch Act, 5 USC § 1502 (a) (3), when he ran for elective office while a State governmental employee, resulting in the termination of his employment. Blackburne subsequently filed a grievance alleging that he was terminated without regard to the procedural rights guaranteed to him under the governing collective bargaining agreement (CBA). The issue presented is whether Blackburne is entitled to arbitrate his claim, which he describes as an employee disciplinary matter within the scope of the arbitration clause contained in the CBA, or whether public policy bars arbitration.

I.

On July 5, 1991, Blackburne, an Alcoholism Program Specialist employed by respondent Office of Alcoholism and Substance Abuse Services (OASAS), applied for a six-week leave of absence to seek the Democratic Party nomination for a New York City Council seat. In a memorandum, Blackburne’s supervisor advised him that in the opinion of OASAS his candidacy violated the Hatch Act, that a leave of absence would not cure the violation, and that he should decide between pursuing the nomination or continuing his employment. According to OASAS, Blackburne could not legally pursue political office while employed by that agency. When the City Council election was subsequently postponed, Blackburne requested permission to delay a decision on resignation since his candidacy had become uncertain. OASAS responded that there was no reason "to deny his request pending resolution of the legality of the election by the Federal District Court.”

On August 1, 1991, Blackburne filed his statement of intent to be a Democratic Party candidate for City Council in the September 12, 1991 primary. On August 14, 1991, Blackburne formally renewed his request for a leave of absence. Although OASAS maintained that the Hatch Act barred Blackburne’s continued employment, it granted his request for an unpaid leave of absence while it solicited a ruling on the matter from the Office of Special Counsel (OSC) of the United States Merit Systems Protection Board (the Board), the agency charged with enforcement of the Hatch Act. In the interim, Blackburne lost the election. OSC subsequently charged Blackburne with a violation of the Hatch Act, 5 USC § 1502 (a) (3).

In accordance with 5 USC §§ 1504 and 1505, an administrative hearing was held. The Chief Administrative Law Judge found that Blackburne’s bid for a partisan elective office violated 5 USC § 1502 (a) (3) and recommended his discharge from employment with OASAS. Blackburne appealed by filing exceptions with the Board. In its Final Decision and Order, the Board adopted and incorporated the decision of the Chief Administrative Law Judge. The Board ordered respondent OASAS to "remove [Blackburne] from his position within 30 days * * * [or] be subject to the sanction of a withholding of federal funds, as provided at 5 U.S.C. § 1506.” OSC was directed to apprise the Board of Blackburne’s employment status within 60 days and to monitor Blackburne’s employment for the succeeding 18 months (see, 5 USC § 1506 [a]). The Board also informed the parties of their right to file a petition for review in United States District Court within 30 days (see, 5 USC § 1508).

By letter dated August 4, 1993, OASAS notified Blackburne that his employment was terminated effective August 6, 1993 in accordance with the Final Decision and Order of the Board. Blackburne interpreted this letter to be a "notice of discipline” under article 33 of the collective bargaining agreement between petitioner Public Employees Federation (PEF), of which he was a member, and OASAS, and advised OASAS that he intended to file a grievance pursuant to article 34. OASAS in turn informed Blackburne that he was discharged in accordance with the Board’s Final Decision and Order, and that the August 4, 1993 letter was not a "notice of discipline.”

Nevertheless, PEF filed a grievance on Blackburne’s behalf under article 34 of the CBA claiming that he was discharged without regard to the procedural rights guaranteed by article 33. OASAS rejected the grievance, declaring that the termination was outside the scope of the CBA and not the proper subject of a contract grievance. However, respondent The Governor’s Office of Employee Relations (GOER) independently accepted PEF’s choice of an arbitrator and indicated it would contact the selected arbitrator to arrange a date for the hearing. Four months later, GOER determined that Blackburne was terminated as a matter of law and that his grievance was not arbitrable. GOER thereafter refused to process the grievance. Petitioners Blackburne and PEF subsequently instituted this proceeding pursuant to CPLR 7503 (a) to compel arbitration in accordance with article 34 of the CBA.

Supreme Court granted the petition and directed the parties to proceed to arbitration. Supreme Court found that the Hatch Act does not preempt the rights granted to Blackburne pursuant to the CBA and that the issue of whether Blackburne was denied the protection of article 33 is an arbitrable dispute. The Appellate Division reversed, holding that the exclusionary clause contained in section 34.1 bars arbitration of Blackburne’s grievance because the Hatch Act serves as the " 'other means of resolution * * * provided * * * by statute * * * applicable to the State’ ” (Matter of Blackburne [Governor’s Off. of Empl. Relations], 211 AD2d 13, 15). The Appellate Division further determined that arbitration would offend public policy as it "would significantly lessen the efficacy of the Hatch Act and frustrate its purpose and scope” (id., at 16 [citation omitted]). We now affirm.

II.

The threshold determination of whether there is a valid agreement to arbitrate a dispute between a governmental employer and employee pursuant to CPLR 7503 (a) proceeds "in sequence on two levels” (Matter of Acting Supt. of Schools of Liverpool Cent. School Dist. [United Liverpool Faculty Assn.], 42 NY2d 509, 513; see also, Matter of Committee of Interns & Residents [Dinkins], 86 NY2d 478, 484; Matter of Franklin Cent. School [Franklin Teachers Assn.], 51 NY2d 348, 355). The first level of inquiry involves a determination of whether the subject of the claim sought to be arbitrated is the type authorized by the Taylor Law (codified as Civil Service Law art 14) (see, Matter of Acting Supt. of Schools of Liverpool Cent. School Dist., 42 NY2d, at 513, supra; see also, Binghamton Civ. Serv. Forum v City of Binghamton, 44 NY2d 23, 29). If a statute, decisional law or public policy precludes the governmental employer and employee from referring the dispute to arbitration, then the answer to this inquiry is no and the claim is not arbitrable (see, Matter of Acting Supt. of Schools of Liverpool Cent. School Dist., 42 NY2d, at 513, supra). In this situation, the court need not reach the second level of inquiry which requires a determination of whether the subject matter of the dispute sought to be arbitrated is within the scope of the particular arbitration clause. For the reasons that follow, we conclude that public policy enjoins arbitration of Blackburne’s grievance, halting our inquiry at level one (see, Matter of Acting Supt. of Schools of Liverpool Cent. School Dist, 42 NY2d, at 513, supra; Matter of Committee of Interns & Residents, 86 NY2d, at 484, supra).

Blackburne’s attempt to cast his grievance in terms of a denial by OASAS of the procedures guaranteed under article 33 of the CBA is unavailing in the face of the Board’s Final Decision and Order. The Final Decision and Order mandated that OASAS discharge Blackburne within 30 days; failure to do so would result in an order by the Board directing the United States Department of Health and Human Services to withhold grant moneys from OASAS. Whether to comply with the Board’s directive to discharge Blackburne, or not, and suffer the fiscal consequences, is a sovereign decision which as a matter of public policy "restrict[s] the freedom to arbitrate” (Matter of Susquehanna Val. Cent. School Dist. [Susquehanna Val. Teachers’ Assn.], 37 NY2d 614, 616-617; see also, Board of Educ. v Areman, 41 NY2d 527, 531; Matter of Cohoes City School Dist. v Cohoes Teachers Assn., 40 NY2d 774, 776-777; Matter of Port Wash. Union Free School Dist. v Port Wash. Teachers Assn., 45 NY2d 411, 423 [Breitel, Ch. J., concurring]; accord, Honeoye Falls-Lima Cent. School Dist. v Honeoye Falls-Lima Educ. Assn., 49 NY2d 732, 734).

By enacting the Hatch Act, Congress sought to require public employees who administer or implement policies arid programs underwritten with Federal funds to abstain from politics (see, United Pub. Workers v Mitchell, 330 US 75, 102-103; Biller v United States Merit Sys. Protection Bd., 863 F2d 1079, 1089; Fela v United States, Merit Sys. Protection Bd., 730 F Supp 779, 784). As a means of implementing the Hatch Act, Congress conditioned the continued receipt of Federal moneys by State agencies, like OASAS, on an employee roster that does not include candidates for elective office (see, 5 USC § 1502 [a] [3]). Contravention of this condition not only implicates OASAS’s human resources, but also impacts OASAS’s operating budget because the decision not to remove a partisan employee yields a costly consequence: forfeiture of Federal funds equivalent to two years of the employee’s salary (see, 5 USC § 1506 [a]).

The Hatch Act’s mandate that the State employer either rid itself of politicians or lose Federal funds embodies an important public policy that can only be effectuated by a sovereign determination (compare, Matter of New York City Dept. of Sanitation v MacDonald, 87 NY2d 650, 656-657, [decided today]). As a matter of law, violations of the Hatch Act are punishable by either the employee’s removal from employment or the employer’s loss of Federal funds (see, 5 USC § 1505 [2]; § 1506 [a]). To permit an arbitrator to elect between these two options would amount to an impermissible delegation of the sovereign authority to procure, allocate and disburse Federal funds invested in the OASAS Commissioner.

Mental Hygiene Law § 19.09 (f) designates the OASAS Commissioner as the administrator of all funds, including Federal grants, provided to the State for alcoholism, substance abuse and chemical dependency services {see also, Mental Hygiene Law § 19.28 [a], [b], [d]; NY Const, art VII, § 7). Similarly, the Commissioner is responsible for filing applications to obtain Federal moneys, such as United States Department of Health and Human Services grants, with the Budget Director {see, State Finance Law § 53-a). By investing the Commissioner with the power to determine whether to procure funds and the authority to distribute those moneys to programs under OASAS’s jurisdiction, these statutes grant the Commissioner control over OASAS’s funds and impose a measure of accountability (see, Anderson v Regan, 53 NY2d 356, 359-360; Matter of County of Oneida v Berle, 49 NY2d 515, 522-523). If Blackburne’s grievance proceeded to arbitration, the statutory duties conferred upon the OASAS Commissioner would be usurped by the arbitrator and the chain of control and accountability disrupted (see, Anderson v Regan, 53 NY2d, at 364, supra; Matter of Sprinzen [Nomberg], 46 NY2d 623, 631; cf., Binghamton Civ. Serv. Forum v City of Binghamton, 44 NY2d, at 30, supra). In effect, the threshold, sovereign determination whether OASAS should seek grant moneys from the United States Department of Health and Human Services would be rendered by the arbitrator. Further, delegation of this determination to an arbitrator would run afoul of the appropriation provision in the State Constitution (see, NY Const, art VII, § 7; see also, Anderson v Regan, 53 NY2d, at 365-366, supra).

Because public policy precludes arbitration of petitioner’s claim in the first instance, our inquiry concludes at level one (accord, Board of Educ. v Areman, 41 NY2d 527, supra; Matter of Cohoes City School Dist. v Cohoes Teachers Assn., 40 NY2d 774, supra; cf., Matter of Enlarged City School Dist. [Troy Teachers Assn.], 69 NY2d 905). Therefore, arbitration must be permanently stayed (CPLR 7503 [b]; see, Matter of Sprinzen [Nomberg], 46 NY2d, at 631, supra).

In view of the foregoing, petitioner’s remaining contentions are academic.

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Kaye and Judges Simons, Titone, Bellacosa, Smith and Levine concur.

Order affirmed, with costs.

      . OASAS is the recipient of Federal moneys in the form of grants from the United States Department of Health and Human Services.

      . Article 33 is the negotiated substitute for Civil Service Law §§ 75 and 76 providing for arbitration of employee disciplinary matters.

      . Article 34 establishes the grievance and arbitration procedure for covered employees.

      . GOER, on behalf of the Governor, is responsible for the negotiation and administration of CBAs (see, Executive Law §§ 650-654).


author: Simons, J.

text:
    [664 NE2d 1226, 642 NYS2d 164]
    In the Matter of Gernatt Asphalt Products, Inc., Respondent, v Town of Sardinia et al., Appellants.
    Argued February 7, 1996;
    decided March 28, 1996

      POINTS OF COUNSEL

      David J. Seeger, Buffalo, and DiFilippo, Bennett & Daumen, East Aurora (Anthony DiFilippo III of counsel), for appellants.
    I. The Mined Land Reclamation Law does not preempt or supersede local zoning legislation determining permissible uses within zoning districts; nor does it mandate every municipality to designate at least one district within which mining is a permited principal use. (Jancyn Mfg. Corp. v County of Suffolk, 71 NY2d 91; Incorporated Vil. of Nyack v Daytop Vil., 78 NY2d 500; Vatore v Commissioner of Consumer Affairs, 83 NY2d 645; Matter of Frew Run Gravel Prods. v Town of Carroll, 71 NY2d 126; Matter of Syracuse Aggregate Corp. v Weise, 51 NY2d 278.) II. The Town did not engage in exclusionary zoning if "grandfathered” mine sites are considered; even were this Court to disagree, the Town met, and the Court below misapplied, the "regional needs” standard set forth in Berenson v Town of New Castle (38 NY2d 102). (Matter of Golden v Planning Bd., 30 NY2d 359; Group House v Board of Zoning & Appeals, 45 NY2d 266; Robert E. Kurzius, Inc. v Incorporated Vil. of Upper

      Brookville, 51 NY2d 338.) III. As a matter of law, it must be concluded the Zoning Ordinance amendments conformed to a comprehensive plan. (Goodrich v Town of Southampton, 39 NY2d 1008; Asian Ams. for Equality v Koch, 72 NY2d 121; Udell v Haas, 21 NY2d 463; Matter of Town of Islip v Cuomo, 64 NY2d 50; Matter of Long Is. Pine Barrens Socy. v Planning Bd., 80 NY2d 500; Village of Valatie v Smith, 83 NY2d 396; Morrell v C.I.D. Landfill, 125 AD2d 998; Matter of Town of Bedford v Village of Mount Kisco, 33 NY2d 178.) IV. The Town fully complied with Town Law §§ 264 and 265, General Municipal §§ 239-Z and 239-m and section 12.01 of its own Zoning Ordinance, regarding public notice, referral to planning agencies and public hearing. (Lighthouse Shores v Town of Islip, 41 NY2d 7.) V. Petitioner’s Open Meetings Law claim should be dismissed as a matter of law; alternatively, petitioner was not entitled to summary judgment and the Town should be allowed a trial. (Matter of Battaglia v Schuler, 60 AD2d 759; Martin v Hacker, 83 NY2d 1; Matter of Young v Board of Appeals, 194 AD2d 796; Jacqueline S. v City of New York, 81 NY2d 288, 82 NY2d 749; Friends of Animals v Associated Fur Mfrs., 46 NY2d 1065; Philips v Kantor & Co., 31 NY2d 307.) VI. Petitioner’s State Environmental Quality Review Act claims should be dismissed as a matter of law because it lacks standing, and for lack of proof. (Society of Plastics Indus. v County of Suffolk, 77 NY2d 761; Matter of Har Enters. v Town of Brookhaven, 74 NY2d 524; Matter of Mobil Oil Corp. v Syracuse Indus. Dev. Agency, 76 NY2d 428; Matter of Sun-Brite Car Wash v Board of Zoning & Appeals, 69 NY2d 406; Chinese Staff & Workers Assn. v City of New York, 68 NY2d 359; Matter of Jackson v New York State Urban Dev. Corp., 67 NY2d 400; Matter of Niagara Recycling v Town Bd., 83 AD2d 335.)

      Saperston & Day, P. C, Rochester (Gary J. ODonnell, Frank T. Gaglione and Eric A. Fitzgerald of counsel), for respondent.
    I. The lower court properly struck down the prohibition of mining amendments because the amendments are in conflict with and are superseded by the Mined Land Reclamation Law; the amendments fail to conform to a comprehensive plan; and the amendments constitute exclusionary zoning. (Matter of Briarcliff Assocs. v Town of Cortlandt, 144 AD2d 457, 74 NY2d 611; Matter of Frew Run Gravel Prods. v Town of Carroll, 71 NY2d 126; Matter of Hunt Bros. v Glennon, 81 NY2d 906; Matter of Valley Realty Dev. Co. v Town of Tully, 187 AD2d 963, 81 NY2d 880; Matter of Syracuse Aggregate Corp. v Weise, 51 NY2d 278; Los-Green, Inc. v Weber, 156 AD2d 994, 76 NY2d 701;
      Asian Ams. for Equality v Koch, 72 NY2d 121; Albright v Town of Manlius, 34 AD2d 419, 28 NY2d 108; Walus v Millington, 49 Misc 2d 104, affd sub nom. Walus v Gordon Realty Corp., 31 AD2d 777; Matter of Miles v Town Bd., 68 Misc 2d 353.) II. The lower court correctly ruled that in adopting amendments significantly different than those proposed, Sardina violated Town Law §§ 264 and 265, General Municipal Law §§ 239-Z and 239-m and its own Zoning Ordinance. (Matter of Gardiner v Lo Grande, 92 AD2d 611, 60 NY2d 673; Village of Mill Neck v Nolan, 233 App Div 248, 259 NY 596; Callanan Rd. Improvement Co. v Town of Newburgh, 6 Misc 2d 1071, 5 AD2d 1003; Matter of Pleasant Val. Home Constr. v Van Wagner, 41 NY2d 1028; Matter of Gernatt Gravel Prods. v Town of Collins, 105 AD2d 1057; Matter of North Shore Steak House v Board of Appeals, 30 NY2d 238; Matter of Fischlin v Board of Appeals, 176 AD2d 50; Matter of Pelham Esplanade v Board of Trustees, 77 NY2d 66; Matter of Harbison v City of Buffalo, 4 NY2d 553; Village of Valatie v Smith, 83 NY2d 396.) III. The lower court correctly found that the Town failed to strictly comply with the State Environmental Quality Review Act in adopting the prohibition of mining amendments. (Matter of Har Enters. v Town of Brookhaven, 74 NY2d 524; Matter of Mobil Oil Corp. v Syracuse Indus. Dev. Agency, 76 NY2d 428; Society of Plastics Indus. v County of Suffolk, 77 NY2d 761; Matter of Sun-Brite Car Wash v Board of Zoning & Appeals, 69 NY2d 406; Glen Head— Glenwood Land Civic Counsel v Town of Oyster Bay, 88 AD2d 484; Matter of Town of Henrietta v Department of Envtl. Conservation, 76 AD2d 215; Matter of Modern Landfill v Jorling, 161 AD2d 1112; Matter of Badura v Guelli, 94 AD2d 972; Matter of Jackson v New York State Urban Dev. Corp., 67 NY2d 400; H.O.M.E.S. v New York State Urban Dev. Corp., 69 AD2d 222.) IV. The lower court properly found that the Town violated the Open Meetings Law in adopting the prohibition of mining amendments. (Matter of Sciolino v Ryan, 81 AD2d 475; Matter of New York Univ. v Whalen, 46 NY2d 734; Matter of Britt v County of Niagara, 82 AD2d 65; Matter of Orange County Publs. v Council of City of Newburgh, 60 AD2d 409, 45 NY2d 947.)
   OPINION OF THE COURT

Simons, J.

Petitioner challenges the legality of amendments to the Town of Sardinia’s Zoning Ordinance which eliminated mining as a permitted use throughout the Town. The principal issues presented are whether: (1) the Town violated various statutory provisions relating to referral and public notice of the amendments when it enacted some but not all of the amendments that were proposed; (2) the New York State Mined Land Reclamation Law supersedes the Town’s authority to amend its Zoning Ordinance in a manner that eliminates mining as a permitted use throughout the Town; and (3) the Town’s action constituted impermissible exclusionary zoning. Also presented are secondary issues regarding the Town’s compliance with procedures mandated by the State Environmental Quality Review Act (SEQRA) and the open meetings provisions of the Public Officers Law.

The Town of Sardinia is a small rural community located in western New York. Farming is the economic mainstay but it is rich in deposits of extractable minerals. Eight mines, covering over 600 acres, are presently located within the Town. These mining uses were lawful under the Town Zoning Ordinance adopted in 1969, which permitted mining in all R-A districts and, by incorporation, in all other districts in the Town. Town Board approval of a mining site was required, however, and approval was conditioned on consideration of the possible nuisance to neighbors of the proposed site and the miner’s plan to restore the land after mining operations ceased.

Petitioner Gernatt has conducted mining operations at several sites within the Town for many years and presently owns three operating mines. In 1989, it acquired a 400-acre parcel of land known as the Gabel Thomas property. It has applied to the Department of Environmental Conservation (DEC) for the necessary State permit to mine the site but has not yet received one. Following petitioner’s purchase of the Gabel Thomas site, the Town became concerned about the effect its development might have on this rural community, and took a number of steps to regulate the expansion of mining within its borders.

This litigation focuses on three ordinances introduced by the Town Board at its meeting August 18, 1993. The first two were adopted. Section 6.02 (A) (5) of the existing Zoning Ordinance made quarries, clay, sand and gravel pits permitted uses in R-A districts, and the first ordinance adopted at the August meeting repealed that section. The second ordinance repealed section 7.07 which required approval of the Town Board to excavate. The third proposal, which designated quarries, clay, sand and gravel pits as specially permitted uses but only at sites currently authorized by DEC, was tabled for further study.

It is important to note three points about the Town’s actions and the three proposed amendments: (1) the amendments as enacted did not prohibit or terminate existing mining operations throughout the Town — they continued as lawful, but nonconforming uses; (2) the only functional difference between the amendments as proposed and as enacted is the legal status of currently operating mines: while mining on existing sites is now a nonconforming use under the Town’s Zoning Ordinance, had the amendments been adopted as proposed mining on existing sites would have been a specially permitted use; and (3) even if all three proposed amendments had been enacted, new mining would not have been permitted in the Town, because proposed section 7.07 authorized special permits only for mining sites permitted by the DEC at the time the legislation was enacted.

Petitioner instituted this special proceeding seeking to annul the Board’s adoption of the "repealer” amendments and to enjoin the Town from enforcing the nonconforming use provision of its Zoning Ordinance. It asserted nine causes of action and several grounds of illegality. Converting the proceeding to an action for declaratory judgment, Supreme Court rejected each of petitioner’s claims and declared that the amendments had been validly enacted. On appeal, the Appellate Division concluded that because the amendments as adopted were different from the amendments as proposed, the notice and referral requirements of the Town Law, the General Municipal Law and Sardinia Town Ordinance § 12.01 were not satisfied. The Court further held that the adopted amendments were inconsistent with and preempted by the New York State Mined Land Reclamation Law, that the Town had engaged in unconstitutional exclusionary zoning and that the amendments had not been enacted in accordance with a comprehensive plan. The Appellate Division determined further that petitioner had standing to challenge the amendments as violative of SEQRA and that the Town had failed to comply with SEQRA, and it also concluded that the Town violated the Open Meetings Law.

We consider each of these grounds separately and, for the reasons that follow, we reverse the order of the Appellate Division.

I. Notice and Referral Requirements

Town Law § 264 (1) and § 265 (1) require a town board to give the public at least 10 days’ notice of the time and place of the public hearing at which proposed amendments to a local zoning ordinance will be discussed so that those interested in the amendments may attend and participate in the hearing. To facilitate regional review of amendments to a local zoning ordinance, General Municipal Law § 239-m requires the local municipality to refer its proposed amendments to the county planning board. In addition, the Town of Sardinia Zoning Ordinance requires the Town Board to submit any proposed amendments to the Town Planning Board for its report and recommendation. Petitioner contends that the Town Board failed to comply with each of these notice and referral provisions.

After notifying abutting municipalities and publishing notice of the public hearing regarding the proposed amendments, and referring the proposed amendments to the Erie County Department of Environment and Planning, which responded with "no recommendation,” and the Town Planning Board, which recommended adoption of the amendments, a public hearing and Town Board meeting were held on August 18, 1993. The hearing was well attended and lively, with substantial opposition to the amendments voiced by petitioner’s representatives and others with interests in the mining industry and support for the legislation voiced by several residents of the community.

After the hearing ended, the Town Board convened its meeting to consider the proposed amendments. In light of comments made during the public hearing, Town Counsel suggested that the Board move into executive session. When the Board emerged from the executive session some 25 minutes later, the Town Supervisor announced that they had discussed "current and potential litigation.” Counsel then recommended that the Board adopt the first two of the proposed zoning amendments (those repealing section 6.02 [A] [5] and 7.07) and table consideration of proposed section 7.07 establishing mining as a specially permitted use. The Board did so. To date, proposed section 7.07 has not been adopted by the Sardinia Town Board.

Petitioner’s position is that the Town Board was required to enact either all or none of the three proposed amendments included in the public notice, or to renotice and rerefer the proposed amendments once it had determined to enact only two of them. It does not allege any procedural noncompliance with the notice or referral provisions, but contends that the substance of the notice and referrals actually given by the Town Board was inadequate because the recipients were alerted only that mining was to be changed from a permitted use throughout the Town to a specially permitted use, not that it would become a nonconforming use.

The public notice required by Town Law §§ 264 and 265 is notice of "the time and place” of the hearing in order that "the public shall have an opportunity to be heard” (Town Law § 264 [1]; see also, Town Law § 130 [notice of action upon local ordinances must "in general terms describ(e) the proposed ordinance”]). The sufficiency of the notice is tested by whether it fairly apprises the public of the fundamental character of the proposed zoning change. It should not mislead interested parties into foregoing attendance at the public hearing (see generally, 1 Rathkopf, Zoning and Planning § 10.04).

A notice that describes the proposed change with reasonable precision will satisfy these purposes of the notice requirement (see, Coutant v Town of Poughkeepsie, 69 AD2d 506, 510-512; cf., Matter of Gardiner v Lo Grande, 92 AD2d 611, affd on other grounds 60 NY2d 673). When events subsequent to the publication of notice lead to an amendment that is substantially different from that which was noticed, new notice and opportunity to be heard may be required (Village of Mill Neck v Nolan, 259 NY 596; see, e.g., Callanan Rd. Improvement Co. v Town of Newburgh, 6 Misc 2d 1071, affd, 5 AD2d 1003). However, where the amendment as adopted is embraced within the public notice, the notice has satisfied its purpose of alerting the public to potential and contemplated revisions of the local ordinance, and the notice will generally be deemed sufficient (see, Lighthouse Shores v Town of Islip, 41 NY2d 7, 10-11).

The Town Clerk published the following notice of the time and place of the public hearing:

"for the purpose of hearing comments on proposed amendments to the Zoning Ordinance of the Town of Sardinia. Said amendments would delete Section 6.02 A.5 and Section 7.07 of the Zoning Ordinance, and would create a new Section 7.07, entitled 'Special Use Permits for Certain Mines.’ The deletion of Section 6.02 A.5 would eliminate mining as a permitted use anywhere within the Town of Sardinia. The new Section 7.07 would designate those mines permitted by the New York State Mined Land Reclamation Law and in operation at the time of adoption of the new Section 7.07 of the Zoning Ordinance as a permissible use in the district within which they lie.”

The notice briefly described the proposed new section 7.07, advised that copies of the entire text of the proposed amendments were available, and invited submission of written as well as public comment at the hearing. It clearly advised the public that three separate though related amendments were contemplated. The public was advised that the repealer provisions "would eliminate mining as a permitted use anywhere within the Town of Sardinia” and that the special permit provision "would designate those mines * * * in operation at the time of adoption of the new Section 7.07 * * * as a permissible use in the district within which they lie.” The announcement clearly included notice of the repealer provisions subsequently enacted and there was nothing inaccurate or misleading about it. That petitioner interpreted the publication as an all-or-nothing proposal, and prepared and directed its comments and objections exclusively to the adoption of the special permit provision and not the repealer provisions, cannot be blamed on any deficiency in the published notice.

Similarly, the referrals to the County Board and the Town Planning Board were sufficient. General Municipal Law § 239-Z states the purpose of referral to the county planning board: to permit its review of and recommendation on the proposed action "as an aid in coordinating such zoning actions and planning among municipalities by bringing pertinent inter-community and county-wide considerations to the attention” of the municipality that is considering the action. A similar but narrower purpose may be attributed to the local ordinance requiring referral to the Town Planning Board — to permit its consideration of and recommendations regarding municipal planning issues that may not otherwise come to the attention of the Town Board.

The County and Town Planning Boards received notice of the three proposed amendments in this case. Thus, it cannot be said that the Town failed to refer the matter as required by statute (compare, Matter of Ferrari v Town of Penfield Planning Bd., 181 AD2d 149). Moreover, the Planning Boards were clearly notified that the effect of the amendments, both as proposed and as enacted, was to limit mining operations in the Town to currently existing mining sites.

The only functional difference between the amendments as proposed and as enacted related to the legal status of the use of currently operating mine sites. While the legal status of the existing mine sites was significant to the landowner and the Town Board, it was of little relevance to traffic, population density, community appearance and facilities, and other matters within the domain and concern of the Planning Boards (see, General Municipal Law § 239-l). Accordingly, having referred the proposed amendments to the Planning Boards as required by General Municipal Law § 239-m and Sardinia Zoning Ordinance § 12.01, the action by the Town Board in adopting only the repealer provisions did not render those referrals defective.

II. The Mined Land Reclamation Law

The Mined Land Reclamation Law (ECL 23-2701 et seq. [the MLRL]) is a comprehensive legislative scheme which broadly empowers the Department of Environmental Conservation to regulate the mining industry in this State. The policies underlying the statute are to foster and encourage an economically sound and stable mining and minerals industry, to manage well depletable mineral resources, and to provide for the reclamation of mined land (see, ECL 23-2703 [1] [as originally enacted, L 1974, ch 1043, and as amended, L 1991, ch 166]). The Legislature sought to achieve those purposes by replacing the existing patchwork of local regulatory ordinances with "standard and uniform restrictions and regulations” and by addressing the environmental issues related to reclamation of abandoned mining sites (Matter of Frew Run Gravel Prods. v Town of Carroll, 71 NY2d 126, 131-133). As originally enacted, the provisions of the statute expressly superseded "all other state and local laws relating to the extractive mining industry * * * [except] local zoning ordinances or other local laws which impose stricter mined land reclamation standards or requirements than those found herein” (ECL 23-2703 [former (2)]).

In Frew Run, we addressed whether the MLRL preempted a municipality’s zoning ordinance when the DEC had issued a permit to operate a sand and gravel mine at a site that lay within a zoning district in which mining was not a permitted use. We noted that under the MLRL, the preemption question was one of statutory construction, not a search for implied preemption, because the Legislature included within the MLRL an express supersession clause. We concluded that the MLRL did not preempt the local zoning ordinance which limited mining activities to certain zoned districts (see, Matter of Frew Run, 71 NY2d, at 130-131, supra).

The supersession clause of the MLRL has since been amended (see, ECL 23-2703 [2], amended by L 1991, ch 166, § 228), and the question is whether the amendments to the Zoning Ordinance of the Town of Sardinia which eliminated mining as a permitted use in all zoning districts are preempted by the Mined Land Reclamation Law. Relying on the amendment to the MLRL as a restatement of the policy in favor of fostering and promoting the mining industry in this State, and contending that our holding in Frew Run leaves municipalities with the limited authority to determine in which zoning districts mining may be conducted but not the authority to prohibit mining in all zoning districts, petitioner contends that the "repealer provisions” enacted by the Town of Sardinia are invalid because they are preempted by the Mined Land Reclamation Law. Neither the Mined Land Reclamation Law as amended nor the holding in Frew Run leads to that conclusion.

In Frew Run, we distinguished between zoning ordinances and local ordinances that directly regulate mining activities. Zoning ordinances, we noted, have the purpose of regulating land use generally. Notwithstanding the incidental effect of local land use laws upon the extractive mining industry, zoning ordinances are not the type of regulatory provision the Legislature foresaw as preempted by Mined Land Reclamation Law; the distinction is between ordinances that regulate property uses and ordinances that regulate mining activities (see, Matter of Frew Run, 71 NY2d, at 131, supra; see also, Matter of Hunt Bros. v Glennon, 81 NY2d 906; compare, Matter of Briarcliff Assocs. v Town of Cortlandt, 144 AD2d 457, lv denied 74 NY2d 611; Matter of Northeast Mines v State of New York Dept. of Envtl. Conservation, 113 AD2d 62, lv denied 68 NY2d 612). In Frew Run, we concluded that nothing in the plain language, statutory scheme, or legislative purpose of the Mined Land Reclamation Law suggested that its reach "was intended to be broader than necessary to preempt conflicting regulations dealing with mining operations and reclamation of mined lands” (id., at 133 [emphasis added]), and that in the absence of a clear expression of legislative intent to preempt local control over land use, the statute could not be read as preempting local zoning authority.

The express supersession provision of the MLRL (ECL 23-2703), was amended in 1991. It now provides:

"For the purposes stated herein, this title shall supersede all other state and local laws relating to the extractive mining industry; provided, however, that nothing in this title shall be construed to prevent any local government from * * * enacting or enforcing local zoning ordinances or laws which determine permissible uses in zoning districts” (ECL 23-2703 [2] [b]).

The patent purpose of the 1991 amendment was to withdraw from municipalities the authority to enact local laws imposing land reclamation standards that were stricter than the Statewide standards under the MLRL. The language of this amended provision accords with the distinction drawn in Frew Run between zoning ordinances and local ordinances that regulate mining activities, and there is nothing in the sparse legislative history of the amendment to the statute suggesting that the Legislature intended the MLRL to go further and limit municipalities’ broad authority to govern land use.

Petitioner contends that the amendments to the Zoning Ordinance prohibit mining throughout the Town. In its view the amendments necessarily regulate mining and are therefore preempted by the MLRL because they conflict with the statute’s stated purpose of fostering the mining industry in this State. It relies on this Court’s observation in Frew Run that while the Town of Carroll prohibited mining in one district, it allowed mining by special permit in another. At bottom, petitioner’s argument is that if the land within the municipality contains extractable minerals, the statute obliges the municipality to permit them to be mined somewhere within the municipality.

Nothing in the MLRL imposes that obligation on municipalities, nor has the Legislature broadened the preemptive reach of the statute to restrict municipal authority to regulate permissible uses of land within the municipality. Rather, in amending ECL 23-2703 in 1991, the Legislature expressly excluded that authority from its preemptive reach. Thus, we conclude that the MLRL does not preempt the Town’s authority to determine that mining should not be a permitted use of land within the Town, and to enact amendments to the local zoning ordinance in accordance with that determination.

III. Exclusionary Zoning

A.

The challenged amendments to the Sardinia Zoning Ordinance eliminate mining as a permitted use in the Town. Seizing upon this fact and its exclusionary appearance, petitioner contends that the amendments are unconstitutional under our decision in Berenson v Town of New Castle (38 NY2d 102).

Berenson involved an attack on an ordinance which prevented the construction of multifamily residences upon open and undeveloped land within the Town of New Castle at a time when no multifamily residences existed there. The primary goal of a zoning ordinance, we said, is to provide for the development of a balanced, cohesive community which will make efficient use of the Town’s available land. Thus, a community must consider regional needs and requirements when enacting a zoning ordinance. An ordinance shown to be enacted for an improper purpose or that has an exclusionary effect is invalid. A community may not use its police power to maintain the status quo by preventing members of lower and middle socioeconomic groups from establishing residency in the municipality (see, Berenson v Town of New Castle, supra; Robert E. Kurzius, Inc. v Incorporated Vil. of Upper Brookville, 51 NY2d 338, 345, cert denied 450 US 1042; cf., Asian Ams. for Equality v Koch, 72 NY2d 121, 134-135; see generally, 1 Anderson, New York Zoning § 8.01 et seq.).

We have never held, however, that the Berenson test, which is intended to prevent a municipality from improperly using the zoning power to keep people out, also applies to prevent the exclusion of industrial uses. A municipality, is not obliged to permit the exploitation of any and all natural resources within the town as a permitted use if limiting that use is a reasonable exercise of its police powers to prevent damage to the rights of others and to promote the interests of the community as a whole (see generally, 4 Rathkopf, Zoning and Planning § 54.01; 1 Anderson, New York Zoning § 9.11).

Petitioner has two interests: to continue operating its existing mines in Sardinia and to develop its newly acquired Gabel Thomas site if it can obtain a DEC permit to do so. The amendments to the Zoning Ordinance did not prohibit it from operating its existing mines in Sardinia: they continue as lawful nonconforming uses. Thus, the test for exclusionary zoning articulated in Berenson, even if it applied to industrial uses, would not invalidate the Town’s action here because mining operations lawfully continue in the Town. Insofar as petitioner contends that the amendments prohibit the development of new mines, it has no vested right to have the existing zoning ordinance continue unchanged if the Town Board has rationally exercised its police power and determined that a change in the zoning was required for the well-being of the community (see, Matter of Khan v Zoning Bd of Appeals, 87 NY2d 344; Rodgers v Village of Tarrytown, 302 NY 115, 121).

On its face, the Town’s action in limiting mining activity to nonconforming use status on existing sites was lawful and nothing in the record suggests that it did, in fact, exclude that use or exercise its police powers to regulate mining for improper purposes.

B.

Nor do we agree that the Town’s action was invalid because it failed to meet the statutory requirement that municipal zoning must accord with a comprehensive plan (see, Udell v Haas, 21 NY2d 463; Town Law § 263; Village Law § 7-704; see also, General City Law § 20 [25]).

A "comprehensive plan” may be discerned from an examination of all evidence of the municipality’s land use policies. "Zoning legislation is tested not by whether it defines a well-considered plan, but by whether it accords with a well-considered plan for the community” (Asian Ams. for Equality v Koch, 72 NY2d, at 131, supra [emphasis added]). The essential purpose of the requirement that rezoning be in accordance with a comprehensive plan is to guard against ad hoc zoning legislation affecting the land of a few without proper regard to the needs or design of the community as a whole (see, Town of Bedford v Village of Mount Kisco, 33 NY2d 178, 187-188; Udell v Haas, supra; Thomas v Town of Bedford, 11 NY2d 428). A municipality may change its zoning ordinance, however, to promote the general welfare and to respond to changed conditions in the community (see, Rodgers v Village of Tarrytown, 302 NY, at 121-122, supra). The question is whether the change "conflict[s] with the fundamental land use policies and development plans of the community” (Udell v Haas, 21 NY2d, at 472, supra; Asian Ams. for Equality v Koch, 72 NY2d, at 131, supra).

The amendments at issue in this case are, by their very nature, in accord with the comprehensive plan manifested in the Zoning Ordinance of the Town of Sardinia originally enacted. Its authorization of mining throughout the Town as a matter of right indicated that the Town in 1969 considered mining to be generally beneficial and consistent with the character and needs of the community. However, the record reveals that in 1993, the Town Board considered that some 600 acres of land within the Town were presently being mined and would continue to be mined, and that those operating sites could be expanded to their property boundaries as nonconforming uses (Zoning Ordinance § 8.07). The record further reveals that in enacting the amendments which prohibit further expansion of mining, the Town Board was responding to legitimate concerns created by its continued growth in the Town and the potential for major portions of the Town’s area to be devoted solely to mining operations. The Town Board noted the potential adverse effect of such growth upon the environment and the Town’s source of drinking water, upon the rural and agricultural economy and character of the Town, as well as the adverse impact of expanded mining on existing residences and future residential development. Moreover, because the Town removed mining as a permitted use throughout the municipality, it cannot be seriously contended that the Board acted irrationally or engaged in ad hoc zoning legislation (compare, e.g., Udell v Haas, supra; Walus v Millington, 49 Misc 2d 104, affd sub nom. Walus v Gordon Realty Corp., 31 AD2d 777).

Petitioner has proffered no argument to the Town Board, to the courts below, or to this Court suggesting that the curtailment of growth of the mining industry was contrary to the general welfare of the community or the fundamental land use policies of the Town. In sum, petitioner failed to sustain its burden of demonstrating that the amendments to the Zoning Ordinance were not in accordance with a comprehensive plan.

IV. The Open Meetings Law

Petitioner alleged that during the special meeting held immediately after the public hearing on August 18, 1993, the Town Board went into an executive session during which it "drafted new legislation” — it describes the. legislation as the "NonConforming Use Amendments” — adopted after the Board emerged from the executive session. It alleges that respondents thereby violated the Open Meetings Law because the drafting of new legislation is not a statutorily authorized purpose for conducting an executive session (see, Public Officers Law § 103 [a]; § 105 [1]).

In the answer to the petition, verified by a current Board member who attended the executive session, the Town asserted that discussion at the executive session was limited to obtaining legal opinions and advice from the Town’s Counsel about the adoption of the proposed amendments (not an unreasonable subject for discussion considering the threats advanced by petitioner and its adherents at the public hearing) and pending litigation by petitioner against the Town on a separate but related matter. Thus, the Town asserted as an affirmative defense Public Officers Law § 105 (1) (d), which defines "discussions regarding proposed, pending or current litigation” as a permissible purpose for an executive session.

The purpose of the Open Meetings Law is to prevent municipal governments from debating and deciding in private what they are required to debate and decide in public (see, Matter of Gordon v Village of Monticello, 87 NY2d 124, 126-127; Matter of Sciolino v Ryan, 81 AD2d 475). Courts are empowered, "m their discretion and upon good cause shown, to declare void any action taken by a public body in violation of the mandate of this legislation” (Matter of New York Univ. v Whalen, 46 NY2d 734, 735 [emphasis in original]; see, Public Officers Law § 107 [1]). It is the challenger’s burden to show good cause warranting judicial relief (Matter of New York Univ. v Whalen, 46 NY2d, at 735, supra).

The contention of petitioner notwithstanding, respondents manifestly did not "draft new legislation” during the executive session. Following the executive session, the Board enacted two of the amendments proposed which were not new or different from the proposed amendments, and it tabled the remaining proposed amendment. Petitioner has failed to assert any fact controverting the Town’s sworn allegation that the executive session was conducted only for a permissible purpose under Public Officers Law § 105 (1) (d), and its allegation that respondent violated the Open Meetings Law is without merit.

V. SEQRA

Petitioner presents two issues related to respondents’ compliance with the State Environmental Quality Review Act: (1) whether petitioner has standing to challenge the Town Board’s compliance with SEQRA; and (2) whether the Town Board adequately conducted the required substantive review of the zoning legislation to support its negative declaration. We conclude that petitioner has standing to challenge respondents’ compliance, but the challenge is without merit.

Generally, standing to challenge an administrative action turns on a showing that the action will have a harmful effect on the challenger and that the interest to be asserted is within the zone of interest to be protected by the statute (see, Matter of Dairylea Coop. v Walkley, 38 NY2d 6, 10). A nearby property owner may have standing to challenge a proposed zoning change because aggrievement may be inferred from proximity (Matter of Sun-Brite Car Wash v Board of Zoning & Appeals, 69 NY2d 406, 413-414). The proximity alone permits an inference that the challenger possesses an interest different from other members of the community. Standing to raise a SEQRA claim involves this variation: a SEQRA challenger must "demonstrate that it will suffer an injury that is environmental and not solely economic in nature” (Matter of Mobil Oil Corp. v Syracuse Indus. Dev. Agency, 76 NY2d 428, 433). However, where the challenge is to the SEQRA review undertaken as part of a zoning enactment, the owner of property that is the subject of rezoning need not allege the likelihood of environmental harm (Matter of Har Enters. v Town of Brookhaven, 74 NY2d 524). In those circumstances, the "property owner has a legally cognizable interest in being assured that the town satisfied SEQRA before taking action to rezone its land” (id., at 529; compare, Society of Plastics Indus. v County of Suffolk, 77 NY2d 761).

Petitioner has standing to challenge respondents’ compliance with SEQRA because it is the owner of a potential mining site it intends to operate in the future and which is affected by the amendments to the Town of Sardinia Zoning Ordinance removing new mining operations from the permitted uses within the Town.

Petitioner challenges the Town Board’s review of the environmental effects of the amendments to the Zoning Ordinance on two grounds: that the Town Board’s completion of the Full Environmental Assessment Form, which provided the basis for the Town Board’s negative declaration and findings, was prepared with respect to the proposed "special permit” amendments, and thus the Town Board failed to conduct a SEQRA review with respect to the "nonconforming use amendments” that were ultimately adopted; and that even if the review undertaken is applicable to the amendments as adopted, the Town Board’s completion of the Assessment Form was accomplished in a hasty and therefore inadequate manner.

A court’s authority to examine a SEQRA review conducted by an entity that was required to do so is limited to reviewing whether the determination was made in violation of lawful procedure, was affected by an error of law or was arbitrary and capricious or an abuse of discretion. The relevant question before the court is "whether the agency identified the relevant areas of environmental concern, took a 'hard look’ at them, and made a 'reasoned elaboration’ of the basis for its determination” (Matter of Jackson v New York State Urban Dev. Corp., 67 NY2d 400, 417; see, Matter of Chemical Specialties Mfrs. Assn. v Jorling, 85 NY2d 382, 396-397; Chinese Staff & Workers Assn. v City of New York, 68 NY2d 359, 363-364; see also, Matter of Niagara Recyling v Town Bd., 83 AD2d 335, 340-341, affd 56 NY2d 859). While the judicial review must be genuine, "the agency’s substantive obligations under SEQRA must be viewed in light of a rule of reason” and the degree of detail with which each environmental factor must be discussed will necessarily vary and depend on the nature of the action under consideration (Matter of Jackson v New York State Urban Dev. Corp., supra, at 417). The potential environmental impact of a specifically proposed project, such as the construction of an industrial incinerator or landfill, may be entirely distinguishable from an amendment to a local zoning ordinance that limits an environmentally related land use, and thus the nature of the environmental impact assessment undertaken by the agencies in relation to such actions will be correspondingly different.

The Environmental Assessment Form and negative declaration here were prepared by the Town Board with a view toward adopting the "special permit” amendment. That does not, however, render respondents’ SEQRA review invalid with respect to the amendments that were enacted. The currently operating mines that became nonconforming uses under the adopted amendments were required to be operating under valid DEC permits. Pursuant to the proposed new section 7.07 to the Town Zoning Ordinance, the primary requirements of the application to the Town for a special permit were conditions designed merely to provide assurance to the Town that the applicant was in compliance with the requirements of the Mined Land Reclamation Law. Realistically then, the fact that the special permit provision was not enacted would not have any independent effect upon the environmental considerations raised under SEQRA, with one exception. The Town, under the proposed special permit provision, would be authorized to impose conditions related to ingress and egress to public thoroughfares and the routing of mineral transport vehicles over Town roads (see, proposed § 7.07 [E]), authority which is lacking under the Zoning Ordinance as it now exists. However, when completing the Environmental Assessment Form with respect to the special permit amendment, the Town Board concluded that that amendment to the Zoning Ordinance would have no effect on existing transportation systems in the Town. Thus, even in that aspect, the special permit amendment was no different from the Ordinance as it now exists. Accordingly, we conclude that the SEQRA review conducted with respect to the special permit amendment was equally applicable to the amendments as adopted.

With respéct to the actual review of the Environmental Assessment Form, petitioner does not contend that the Town Board did not complete the form in relation to the proposed amendments to the Zoning Ordinance — the gravamen of its argument is that the review was conducted too quickly to be valid. The record reveals that at a work session of the full Town Board, it reviewed and answered all of the questions posed on the Full Environmental Assessment Form (see, 6 NYCRR 617.21, Appendix A; see also, 6 NYCRR 617.11). That the Board answered all the questions in the negative, and that it was able to do so quickly, does not establish that its review was inadequate as a matter of law.

The record reflects that the Town Board identified the relevant areas of environmental concern as related to the proposed action, took the requisite "hard look” at them and in its negative declaration set forth a reasoned elaboration of the basis for its determination. Given the nature of the proposed action here, which would have only beneficial environmental effect, and the focus of the Assessment Form, which is to identify negative environmental effects of the proposed action, the Town Board’s rapid review and completion of the Environmental Assessment Form was not arbitrary or capricious.

VI. Conclusions

Respondent did not violate the various notice and referral requirements, because the amendments as adopted were a subset of the amendments as proposed, and the recipients of the notices and referrals were clearly so advised. The municipality’s authority to amend its Zoning Ordinance to eliminate mining as a permitted use in the municipality is not preempted by the Mined Land Reclamation Law, because that statute specifically exempts local zoning enactments from its preemptive reach. The Town of Sardinia did not engage in unconstitutional exclusionary zoning. The Town Board did not violate the Open Meetings Law because it did not draft new legislation during its executive session, and under the circumstances of this case, the Town Board’s SEQRA review was sufficient to withstand judicial scrutiny.

Accordingly, the order of the Appellate Division should be reversed, with costs, and the order and judgment of Supreme Court, Erie County, reinstated.

Chief Judge Kaye and Judges Titone, Bellacosa, Smith, Levine and Ciparick concur.

Order reversed, etc.

      . Specially permitted uses are uses which, though appropriate to a district, may be troublesome because of their nature. Though lawful, they are only authorized subject to such conditions as the zoning officers may impose (see, 2 Anderson, New York Zoning Law and Practice § 24.03). Under the Town’s proposed ordinance, mining would be a permitted use subject to annual approval: conditions could be imposed regarding the use of public thoroughfares, control of nuisance factors and the enforcement of reclamation permits issued by the State (see, proposed ordinance § 7.07 [E]; see also, ECL 23-2703 [2] [b]). Once an owner acquired a special permit, a mining operation could be conducted as of right.
      A nonconforming use is one which lawfully existed before a zoning ordinance has been adopted or amended to generally prohibit the use (see, 1 Anderson, New York Zoning Law and Practice § 6.06). Nonconforming uses, though lawful, are disfavored (see, e.g., Village of Valatie v Smith, 83 NY2d 396, 400), and they continue subject to conditions. Under the Town of Sardinia Zoning Ordinance, a nonconforming use will be extinguished if discontinued for one year ( 8.02), and if the use is changed to a conforming use it may not revert to a nonconforming use ( 8.04). The nonconforming use may be extended to the boundaries of the same lot ( 8.05) but reconstruction or alteration of buildings devoted to the nonconforming use is limited ( 8.06).

        . In furtherance of its arguments, petitioner has mischaracterized the enacted amendments as the "Nonconforming Use” or "Prohibition of Mining” amendments and the proposed amendments as the "Proposed Special Permit Amendments.” In this opinion, the adopted amendments will be referred to as the "repealer provisions” and the tabled amendment as the "special permit provision.”

      . Arguably, petitioner’s claim based on its inability to develop the Gabel Thomas site is not ripe because it has not yet received a DEC permit to operate a mine at that site.


text:
    [664 NE2d 1240, 642 NYS2d 178]
    Bernard Gelbard, Appellant, v Genesee Hospital, Respondent, et al., Defendant.
    Argued February 6,1996;
    decided April 4, 1996

      POINTS OF COUNSEL

      Woods, Oviatt, Gilman, Sturman & Clarke LLP, Rochester (Donald W. O’Brien, Jr., of counsel), for appellant.
    I. Pursuant to the plain wording of the statute, Public Health Law § 2801-b is not applicable to this case because it involves a breach of contract, not a matter within the purview of the Public Health Council. (Matter of Greenberg [Ryder Truck Rental], 70 NY2d 573; Gelbard v Genesee Hosp., 211 AD2d 159; Guibor v Manhattan Eye, Ear & Throat Hosp., 46 NY2d 736; People v Mobil Oil Corp., 48 NY2d 192; Matter of Murphy v St. Agnes Hosp., 107 AD2d 685; Bassim v Howlett, 191 AD2d 760; Chalasani v Neuman, 97 AD2d 806, 64 NY2d 879; Shapiro v Central Gen. Hosp., 173 AD2d 601; Farooq v Fillmore Hosp., 172 AD2d 1063; Matter of Libby [Long Is. Jewish-Hillside Med. Ctr.], 163 AD2d 388.) II. Plaintiffs first cause of action should not be dismissed based upon his request for injunctive relief.

      Michael R. Wolford & Associates, Rochester (Michael R. Wolford and Elizabeth A. Wolford of counsel), for respondent.
    I. Plaintiff must first seek relief from the Public Health Council prior to bringing an action for injunctive relief. (Gelbard v Genesee Hosp., 211 AD2d 159; Guibor v Manhattan Eye, Ear & Throat Hosp., 46 NY2d 736; Matter of Shapiro v Central Gen. Hosp., 181 AD2d 896; Farooq v Fillmore Hosp., 172 AD2d 1063; Matter of Capote v Our Lady of Mercy Med. Ctr., 168 AD2d 238; Matter of Libby [Long Is. Jewish-Hillside Med. Ctr.], 163 AD2d

      388; Mostafa v Aurelia Osborne Fox Mem. Hosp., 159 AD2d 922, 76 NY2d 888; Sawah v Rochester St. Mary’s Hosp., 101 AD2d 694, 64 NY2d 605; Kolker v St. Francis Hosp., 145 Mise 2d 966; Rockland Physician Assocs. v Grodin, 616 F Supp 958.) II. Plaintiff is alleging violations of Public Health Law § 2801-b, and therefore, must exhaust his remedies before the Public Health Council. (Fried v Straussman, 41 NY2d 376, 1009; Jackaway v Northern Dutchess Hosp., 139 AD2d 496; Gelbard v Genesee Hosp., 211 AD2d 159; Saha v Record, 177 AD2d 763; Matter of Shapiro v Central Gen. Hosp., 181 AD2d 896; Matter of Capote v Our Lady of Mercy Med. Ctr., 168 AD2d 238; Matter of Libby [Long Is. Jewish-Hillside Med. Ctr.], 163 AD2d 388; Rovello v Orofino Realty Co., 40 NY2d 633.)

      Higgins, Roberts, Beyerl & Coan, P. C., Schenectady (Charles J. Assini, Jr., of counsel), for New York State Society of Anesthesiologists, Inc., and another, amici curiae.

    I. A physician may maintain an action against a hospital for breach of hospital bylaws based on the laws of contracts, associations and corporations. (Giannelli v St. Vincent’s Hosp., 160 AD2d 227; Matter of Murphy v St. Agnes Hosp., 107 AD2d 685; Tedeschi v Wagner Coll., 49 NY2d 652; Matter of Carr v St. John’s Univ., 17 AD2d 632; Saha v Record., 177 AD2d 763; Shapiro v Central Gen. Hosp., 173 AD2d 601; Browne v Hibbets, 290 NY 459; Polin v Kaplan, 257 NY 277; Simons v Berry, 240 NY 463.) II. Public Health Council review is inapplicable to a cause of action alleging a breach of contract because a breach of contract action is a common-law remedy which is separate and distinct from an improper practice. (Matter of Murphy v St. Agnes Hosp., 107 AD2d 685; Guibor v Manhattan Eye, Ear & Throat Hosp., 46 NY2d 736.) III. Review by the Public Health Council should not supersede common-law legal remedies where such review would be futile, prejudicial and cause irreparable injury. (Watergate II Apts. v Buffalo Sewer Auth., 46 NY2d 52; Matter of Cohoes Mem. Hosp. v Department of Health, 48 NY2d 583.)

      Mark Thomas, Albany, and Garfunkel, Wild & Travis, P. C, Great Neck (David A. Zarett and Roy W. Breitenbach of counsel), for Healthcare Association of New York State, amicus curiae.

    The Court below correctly determined that plaintiff-appellant was required to exhaust his Public Health Council administrative remedies. (Guibor v Manhattan Eye, Ear & Throat Hosp., 46 NY2d 736; Farooq v Fillmore Hosp., 172 AD2d 1063; Matter of Moss v Albany Med. Ctr. Hosp., 61 AD2d 545;
      Matter of Cohoes Mem. Hosp. v Department of Health, 64 AD2d 737, 48 NY2d 583; Fried v Straussman, 41 NY2d 376; Gelbfish v Maimonides Med. Ctr., 184 AD2d 614; Matter of Nawaz v University Hosp., 166 AD2d 593; Jones v Yonkers Gen. Hosp., 143 AD2d 885; Maltz v New York Univ. Med. Ctr., 121 AD2d 323.)
   OPINION OF THE COURT

Ciparick, J.

Plaintiff physician commenced this action for breach of contract against defendant hospital seeking an order requiring the hospital to restore his staff privileges. Because we conclude that the Public Health Council must in these circumstances review plaintiff’s complaint before a court can order the restoration of his staff privileges, we affirm the dismissal of plaintiff’s cause of action for breach of contract.

I.

Plaintiff Dr. Bernard Gelbard, a board-certified anesthesiologist, was appointed to membership on the staff of The Genesee Hospital (TGH) in 1989. In March 1993, Dr. A. Kirk Bodary, the Chief of TGH’s Department of Anesthesiology, recommended that plaintiff not be reappointed to the hospital’s medical staff. In support of his recommendation, Dr. Bodary cited various incidents in which plaintiff allegedly engaged in unacceptable medical practices. Dr. Bodary’s recommendation prompted a series of hearings before ad hoc and review committees to determine what action, if any, the hospital should take regarding plaintiff’s staff privileges. These hearings culminated in a resolution of TGH’s Board of Governors terminating plaintiff’s medical staff privileges.

Plaintiff thereafter commenced this action asserting three causes of action. The first cause of action, asserted against TGH, is for breach of contract based on TGH’s alleged violation of specific medical staff bylaws. Plaintiff does not seek monetary damages for the alleged breach of contract but rather seeks a permanent injunction requiring TGH to restore his staff privileges. The second and third causes of action, asserted against Dr. Bodary, seek damages for defamation and tortious interference with contract. Only the dismissal of the first cause of action is at issue here.

By order to show cause, plaintiff sought a preliminary injunction restraining TGH from terminating his staff privileges. TGH cross-moved to dismiss the first cause of action on the ground that Supreme Court lacked subject matter jurisdiction because plaintiff had failed to exhaust his administrative remedy before the Public Health Council as required by the Public Health Law {see, Public Health Law § 2801-b). Supreme Court denied plaintiff’s motion for a preliminary injunction, finding that plaintiff had failed to demonstrate a likelihood of success on the merits, that the equities weighed, heavily in his favor or that he would suffer irreparable injury if TGH were permitted to terminate his staff privileges. Supreme Court also denied defendant’s cross motion to dismiss, concluding that because plaintiff’s claim was for breach of contract predicated on an alleged violation of specific medical bylaws, and not based on an "improper practice” within the meaning of Public Health Law § 2801-b, the administrative review requirement of section 2801-b did not apply.

On appeal, the Appellate Division reversed Supreme Court’s denial of TGH’s cross motion to dismiss. The Appellate Division concluded that whether administrative review is required by the Public Health Law depends on the relief sought, not necessarily on the nature of the claim. "We believe it is best to establish a 'bright line’ rule that, if a physician seeks reinstatement of hospital privileges, the court is without jurisdiction to consider that issue until the Public Health Council reviews the matter and makes its findings, which constitute prima facie evidence of the facts found therein in any subsequent action” (Gelbard v Genesee Hosp., 211 AD2d 159, 165). This Court granted leave to appeal and we now affirm.

II.

At the time of the enactment of section 2801-b of the Public Health Law, a physician had no common-law right to contest the denial or termination of professional privileges and, absent a contractual right to the contrary, served strictly at the hospital’s pleasure (see, Leider v Beth Israel Hosp. Assn., 11 NY2d 205, 208-209). To mitigate the perceived harshness of this rule, the Legislature undertook to devise a limited avenue of recourse by which a physician could challenge a hospital’s denial or termination of staff privileges. The product of this effort was section 2801-b of the Public Health Law, which makes it an "improper practice” for a hospital to deny or terminate professional privileges for a reason unrelated to "patient care, patient welfare, the objectives of the institution or the character or competency of the applicant” (Public Health Law § 2801-b [1]).

To enforce the statutory prohibition against improper practices, the Legislature created a two-step grievance process by which a physician may obtain injunctive relief requiring the hospital to restore wrongfully terminated staff privileges (see, Matter of Cohoes Mem. Hosp. v Department of Health, 48 NY2d 583, 587; Guibor v Manhattan Eye, Ear & Throat Hosp., 46 NY2d 736, 738). First, the physician must submit a complaint to the Public Health Council (PHC), a committee composed of the State Commissioner of Health and 14 persons appointed by the Governor with the advice and consent of the Senate (see, Public Health Law § 220). After investigating the physician’s complaint, the PHC will either direct the hospital to reconsider its decision or inform the parties of its determination that the complaint lacks merit (see, Public Health Law § 2801-b [3]). Only upon completion of the PHC review may the physician proceed to the second step, which is to commence an action under section 2801-c to enjoin the hospital from improperly denying or terminating staff privileges (see, Guibor, 46 NY2d, at 738, supra). In a section 2801-c injunction action, the PHC’s determination serves as prima facie evidence of the facts found therein (see, Public Health Law § 2801-c).

The requirement of threshold PHC review serves the dual purpose of allowing an expert body to initially review the physician’s complaint and of promoting prelitigation resolution (see, Cohoes Mem. Hosp., 48 NY2d, at 589, supra). We conclude, in view of the statutory scheme and principles of exhaustion of administrative remedies, that both of these undeniably salutary purposes are advanced by interpreting the statute as mandating threshold PHC review in all cases in which a physician seeks injunctive relief to compel the restoration of staff privileges.

A hospital’s decision to grant or deny staff privileges is based on specialized medical considerations involving notions of patient care, physician competence, and institutional welfare. Unlike the courts, which are generally untrained and inexperienced in these matters, the PHC is a body of medical experts dedicated to the review of complex medical care issues, including issues related to the grant or denial of hospital staff privileges (see generally, Public Health Law § 225). The requirement of threshold PHC review thus ensures that before a court orders the restoration of a physician’s staff privileges, the PHC has been afforded an opportunity to apply its special expertise to the issues involved (cf., Johnson v Nyack Hosp., 964 F2d 116, 121 [requiring PHC review before physician could assert antitrust claim to provide PHC opportunity to assess whether termination of staff privileges was medically justified]). This process assists judicial decision making in a subsequent court action because the PHC’s findings are entitled to prima facie effect (see, Public Health Law § 2801-c).

Citing the potentially preclusive effect of the PHC’s determination, plaintiff contends that he will be prejudiced should the PHC determine that his complaint lacks merit (see, Public Health Law § 2801-b [4]). However, the PHC’s findings are accorded only presumptive, not conclusive, effect in sensible recognition of the PHC’s special competence over medical care issues. Thus, we conclude that the potential prejudice does not overcome the statutory purpose and benefits of allowing this expert body to make presumptive findings regarding alleged improper practices. This is particularly so where plaintiff has the initial opportunity to present his complaint and supporting proof to the PHC (see, Public Health Law § 2801-b [2], [3]) and the subsequent opportunity to demonstrate to a court why an adverse determination by the PHC is erroneous (see, Public Health Law § 2801-c).

Even though plaintiff in this case asserts a claim for breach of contract, the fact that he seeks injunctive relief to restore his staff privileges places him squarely within the intended scope of the statute. Were plaintiff permitted to bypass threshold PHC review simply by asserting a breach of contract claim, the carefully calibrated statutory progression within section 2801-b, with its insistence on PHC review before a court can order the restoration of staff privileges, would be undermined (cf., Guibor v Manhattan Eye, Ear & Throat Hosp., 46 NY2d 736, 738, supra). The statutory requirement of threshold PHC review is too important to be circumvented by artful pleading.

In addition, we have recognized the vital mediation role served by the PHC in providing "a professionally competent forum in which to resolve” disputes at an early stage (Matter of Cohoes Mem. Hosp. v Department of Health, 48 NY2d 583, 589, supra). Under the conciliating professional influence of the PHC — an impartial third party with vast experience and unparalleled expertise in these cases — disputes between physician and hospital may be resolved expeditiously, avoiding costly and protracted litigation.

Finally, we reject plaintiff’s argument that requiring threshold PHC review in this case would contravene section 2801-b (4) of the Public Health Law, which provides that "[t]he provisions of this section shall not be deemed to impair or affect any other right or remedy.” We have held that requiring threshold PHC review does not impair or affect any right or remedy available to the physician, but "merely assures prompt investigation by the administrative body best able to assess the respective interests of the parties involved” (see, Guibor, 46 NY2d, at 738, supra). The requirement of PHC review does not foreclose plaintiff from asserting any claims. Thus, regardless of the results of the PHC review, plaintiff is thereafter free to bring a section 2801-c injunction action or any other valid claim. Moreover, the courts are always open to plaintiff to litigate any claims not subject to the requirement of PHC review.

In view of this analysis and because the issue was not raised in the courts below, we do not address whether a breach of contract action can be predicated on a violation of medical staff bylaws (compare, Leider v Beth Israel Hosp. Assn., 11 NY2d 205, supra, with Chalasani v Neuman, 97 AD2d 806, revd on other grounds 64 NY2d 879).

Accordingly, the order of the Appellate Division should be affirmed, with costs.

Chief Judge Kaye and Judges Simons, Titone, Bellacosa, Smith and Levine concur.

Order affirmed, with costs.