| Matter of City of Utica v Daines |
| 2012 NY Slip Op 03696 [95 AD3d 1467] |
| May 10, 2012 |
| Appellate Division, Third Department |
| 2—In the Matter of City of Utica, Appellant, v Richard F.Daines, as Commissioner of Health, et al., Respondents. |
—[*1] Eric T. Schneiderman, Attorney General, Albany (Frank Brady of counsel), for Richard F.Daines and others, respondents. Girvin & Ferlazzo, P.C., Albany (Patrick J. Fitzgerald of counsel), for Utica AmbulanceService, Inc., respondent. Hinman Straub, P.C., Albany (Joseph M. Dougherty of counsel), for New York StateProfessional Fire Fighters Association, IAFF AFL-CIO, amicus curiae. Gleason, Dunn, Walsh & O'Shea, Albany (Ronald G. Dunn of counsel), for Local 32 IAFFUtica Professional Fire Fighters Association, amicus curiae. Gladstein, Reif & Meginniss, L.L.P., New York City (Amelia K. Tuminaro of counsel), forUniformed EMTs, Paramedics and Inspectors-F.D.N.Y., Local 2507, DC 37, AFSCME,AFL-CIO, amicus curiae.
Egan Jr., J. Appeals (1) from an order of the Supreme Court (McGrath, J.), entered January 6,2011 in Albany County, which, in a proceeding pursuant to CPLR article 78, among other things,granted a motion by Utica Ambulance Service, Inc. to intervene, and (2) from a judgment of saidcourt, entered June 24, 2011 in Albany County, which dismissed petitioner's application, in aproceeding pursuant to CPLR article 78, to review a determination of respondent New York StateEmergency Medical Services Council denying petitioner's application for a certificate of need forits ambulance service.[*2]
Public Health Law article 30 governs—insofar as isrelevant here—the certification of ambulance services in the state (see PublicHealth Law § 3000 et seq.). Pursuant to the terms thereof, no ambulance servicemay commence operations without a valid operating certificate (see Public Health Law§ 3005 [1]), and any new ambulance service seeking to operate in a given locale must firstsecure the approval of the appropriate regional emergency medical services council (hereinafterREMSCO) (see Public Health Law §§ 3003, 3005 [6]), which is vested withthe authority "to make determinations of public need for the establishment of additional. . . ambulance services" (Public Health Law § 3003 [5]) in accordance withthe provisions of Public Health Law § 3008.[FN1]Assuming that hurdle is cleared, the applicant is issued what the parties have denominated as a"certificate of public need" for a two-year period (see Public Health Law § 3005[4]).[FN2]
Because "[n]ot less than one-third of the membership" of each REMSCO must consist ofrepresentatives of existing ambulance service providers (Public Health Law § 3003 [2]),municipalities seeking to provide ambulance services to their citizens were deemed to be "at adistinct disadvantage when applying for a determination of public need . . . becausethey must be approved by the [very] groups they are proposing to replace" (AssemblyIntroducer's Letter [Assembly Bill A10611-A], July 23, 1992, Bill Jacket, L 1992, ch 850, at 18).To that end, the Legislature amended Public Health Law § 3008 in 1992 (see L1992, ch 850, § 1) to make it easier for a municipality to obtain a certificate of public needby providing that once "the municipal ambulance service meets appropriate training, staffing andequipment standards, there should be a presumption in favor of approving the [underlying]application" (Public Health Law § 3008 [6]). When this amendment fell short of its statedgoal of "guarantee[ing] [municipalities] equal consideration among existing ambulance services"(Sponsors' Mem [NY Senate-Assembly Bill S7660-A, A10611-A], Bill Jacket, L 1992, ch 850),the Legislature again amended Public Health Law § 3008 in 1997 (see L 1997, ch510, § 1) to permit municipalities to begin operating ambulance services for a two-yearperiod without first obtaining a certificate of public need. Thus, in accordance with Public HealthLaw § 3008 (7) (a), a municipal ambulance service that has satisfied all other pertinentrequirements—i.e., municipal authorization to establish an ambulance service anddemonstrated compliance with respondent Department of Health's standards governing training,staffing and equipment—"shall be deemed to have satisfied any and all requirements fordetermination of public need for the establishment of additional emergency medical servicespursuant to [Public Health Law article 30] for a period of two years." At the end of that initialtwo-year period, the municipality may apply for certification to continue to provide ambulanceservice to its citizens (see Public Health Law § 3008 [7] [b]), and "where [that]proposed service meets or exceeds the appropriate training, staffing and equipment [*3]standards, there shall be a strong presumption in favor of approvingthe [municipality's] application."[FN3]
Against this backdrop, petitioner adopted a resolution authorizing the Utica Fire Departmentto operate an ambulance service, and thereafter was granted a two-year operating certificate forthat purpose. On August 1, 2005, petitioner began providing such service to its citizens. Prior tothe expiration of that initial two-year certificate in 2007, petitioner applied to the appropriateREMSCO for approval to continue operation of its municipal ambulance service. Legalproceedings ensued (see City of Utica vDaines, 53 AD3d 922 [2008]), as a result of which petitioner resubmitted its applicationto REMSCO in December 2008. Following a public hearing, REMSCO denied petitioner'sapplication, and petitioner appealed to respondent New York State Emergency Medical ServicesCouncil (hereinafter SEMSCO) (see Public Health Law § 3002 [3]). Petitioner'sadministrative appeal proved to be unsuccessful, prompting it to commence this CPLR article 78proceeding to challenge SEMSCO's determination.[FN4]Supreme Court granted a motion to intervene brought by Utica Ambulance Service, doingbusiness as Kunkel Ambulance Service (hereinafter Kunkel), a privately-owned company thatprovided ambulance service in the City of Utica, Oneida County for some time prior to 2005, andthereafter dismissed the underlying petition, finding that SEMSCO's determination was rational.These appeals by petitioner ensued.[FN5]
Of the various arguments raised by petitioner, only one warrants discussion. To be sure, ourinquiry here is limited to ascertaining whether the determination rendered by SEMSCO, whichdenied petitioner's application for certification of its municipal ambulance service, is arbitrary,capricious or otherwise affected by an error of law (see generally Matter of Lamar Cent. Outdoor, LLC v State of NewYork, 64 AD3d 944, 947 [2009]). For that reason, we readily agree that the quality,sufficiency or persuasive effect of the proof submitted by petitioner in support of its applicationare matters entrusted—in the first instance—to REMSCO and, [*4]ultimately, are issues for SEMSCO to consider andresolve.[FN6]In undertaking that deliberative process, however, both REMSCO and SEMSCO are bound byPublic Health Law § 3008 (7) (b), which expressly provides that "where the proposedservice meets or exceeds the appropriate training, staffing and equipment standards, there shallbe a strong presumption in favor of approving the application" (see Department of HealthMunicipal Certificate of Need [Muni-CON]: An Overview, at 3 [rev 2009]).[FN7]As our review of the record reveals that neither entity accorded petitioner's application the strongpresumption required by the statute, we conclude that SEMSCO's determination must beannulled.
As a starting point, the record fails to disclose that REMSCO was even awareof—much less applied—the strong presumption set forth in Public Health Law§ 3008 (7) (b).[FN8]Neither the transcript of the public hearing before REMSCO's ambulance committee, the HearingOfficer's written report, the ambulance committee's subsequent meetingminutes/recommendation nor the transcript of REMSCO's discussion of and vote uponpetitioner's application makes any mention of the underlying presumption. Indeed, the onlyinsight into REMSCO's analytical process may be found in its brief filed in connection withpetitioner's administrative appeal—a document that focuses, in large measure, upon thelevel of service provided by Kunkel, the existing private ambulance service provider, and, in sodoing, evidences REMSCO's fundamental misapprehension of the underlying statutory scheme.
It is true, as respondents point out, that the presumption set forth in Public Health Law§ 3008 (7) (b) does not guarantee approval of petitioner's application. However, thatpresumption is rendered meaningless if REMSCO's inquiry distills to whether petitioner hasproved that it can do a better job than Kunkel, which—as the record reflects—isprecisely the analysis that REMSCO undertook here. In its administrative appeal brief, REMSCOchastised petitioner for "confiscati[ng]" 40% of Kunkel's business, argued that "there was never aneed" for petitioner to [*5]provide ambulance service in the firstinstance[FN9]and—perhaps most tellingly—asserted that petitioner "failed to demonstrate that [it]could do anything different or . . . better than Kunkel." Surely that sort of skewedanalysis is not what the Legislature intended when it accorded municipalities such as petitionerthe strong presumption embodied in Public Health Law § 3008 (7) (b).
Although an Administrative Law Judge subsequently recommended overturning REMSCO'sdecision—noting that "there [was] no reference anywhere in the record indicating that atany time . . . REMSCO acknowledged any presumption in favor of [petitioner's]application"—petitioner ultimately fared no better before either SEMSCO's systemscommittee or its full membership. The discussion at the committee level reflected continuedconfusion as to the proper application of the statutory presumption,[FN10]impermissibly questioned the need for petitioner to enter the ambulance service market back in2005 and improperly focused upon whether Kunkel was capable of single-handedly serving thecommunity's ambulance service needs. Similarly, when SEMSCO's membership met to voteupon petitioner's appeal, there was virtually no discussion of the merits of petitioner'sapplication. Rather, REMSCO's chair—the only individual to even reference the statutorypresumption during the course of this meeting—simply urged SEMSCO to disregard theobservations made by the Administrative Law Judge and uphold REMSCO's prior decision,citing the manner in which petitioner "displaced" Kunkel as the primary service provider in 2005and highlighting what he regarded as petitioner's "fail[ure] to persuade [REMSCO] that it had. . . stronger or better evidence regarding the existence of public need" than Kunkelhad put forth. In short, although SEMSCO's systems committee paid lip service to the statutorypresumption, there was no dialogue regarding the presumption when SEMSCO's fullmembership met to vote upon petitioner's application (see Public Health Law §3002 [3]). More to the point, it is readily apparent from a review of the record that SEMSCOfailed, in the final analysis, to actually accord petitioner's application the benefit of the statutorypresumption.[*6]
For all these reasons, we are persuaded that bothREMSCO and SEMSCO failed to adhere to the statutory framework established by Public HealthLaw article 30, neglected to follow the Department of Health's interpretation thereof and, mostnotably, failed to actually afford petitioner's application the strong presumption of approval towhich it was entitled pursuant to Public Health Law § 3008 (7) (b). Accordingly,SEMSCO'S determination is annulled, and petitioner's application is granted to that extent.Petitioner's remaining contentions, including its assertion that the Department of Health'srequirement and/or definition of public need violates various provisions of the General MunicipalLaw and the State Administrative Procedure Act, are either not properly before us or have beenexamined and found to be lacking in merit.
Malone Jr. and McCarthy, JJ., concur.
Stein, J. (dissenting). Because in our view respondent New York State Emergency MedicalServices Council (hereinafter SEMSCO) considered the relevant circumstances and accordedpetitioner's application the benefit of the statutory presumption, we respectfully dissent. Weconcur with Supreme Court's conclusions that SEMSCO[FN11]recognized the presumption to which petitioner was entitled in determining its application for acertificate of public need and that such presumption was effectively rebutted by the informationprovided by Utica Ambulance Service, Inc., doing business as Kunkel Ambulance Service(hereinafter Kunkel).
A presumption is nothing more than "[a] legal inference or assumption that a fact exists,based on the known or proven existence of some other fact or group of facts . . . Apresumption shifts the burden of production or persuasion to the opposing party, who can thenattempt to overcome the presumption" (Black's Law Dictionary 1223 [8th ed 2004]). Here, absentany explicit language to the contrary, the presumption afforded to petitioner pursuant to PublicHealth Law § 3008 (7) (b) is rebuttable and does not guarantee approval of petitioner'sapplication. While, as the majority notes, the presumption was intended to level theplaying field between municipal and private applicants, it does not give municipalities apreference or advantage, nor does it completely obviate the requirement that petitioner meet aspecific need of the population it proposes to serve; it merely creates a legal inference that such isthe case.[FN12][*7]Thus, the presumption permits Kunkel to respond topetitioner's evidence with evidence to the contrary.[FN13]
Notably, in its initial application, the primary basis cited by petitioner for its assertion of apublic need for its ambulance service was a prior lack of continuity of patient care, as well aslimited availability on Kunkel's part to provide services within the City of Utica. Although oneSEMSCO member commented that petitioner's submissions lacked statistical documentation tosupport such assertions, they were nevertheless sufficient—particularly given thepresumption to which petitioner's application was entitled—to shift the burden to Kunkelto demonstrate persuasive evidence of the absence of a need for petitioner's services. To that end,Kunkel submitted the affidavits of its vice-president and finance officer, as well as its director ofoperations, video recordings and an "availability study," all of which demonstrated that Kunkelhad available ambulances, could successfully cover ambulance calls during fires and hadconsistently met Department of Health training, staffing and equipment standards. Kunkel alsorefuted petitioner's assertion that it could provide greater continuity of service. Overall, mindfulthat we may not substitute our judgment for that of SEMSCO, we discern no basis to concludethat SEMSCO's determination—that Kunkel sufficiently rebutted petitioner's argumentthat Kunkel's services were inadequate to meet the public need without petitioner'sassistance—was "arbitrary, capricious or affected by error of law" (Matter of Senior Care Servs., Inc. v NewYork State Dept. of Health, 46 AD3d 962, 965 [2007]).[FN14]
Significantly, the record reflects that SEMSCO fully discussed and considered thepresumptions afforded to petitioner and the evidence in support of and in opposition topetitioner's application. Indeed, one SEMSCO member—who was also a member ofREMSCO—articulated that "[t]here was much discussion about [the] presumption" at theREMSCO level and that Kunkel had overcome any presumption to which petitioner was entitled.[*8]Our review of the record also reveals that SEMSCO wastroubled by the notion that petitioner's true purpose in seeking to provide ambulance services wasnot to improve the continuity of care to its residents but, rather, to generate revenue. In our view,SEMSCO considered the relevant circumstances and accorded petitioner's application the benefitof the presumption.[FN15]Thus, while we recognize the economic investment made by petitioner into the establishment ofsuch services, we would affirm Supreme Court's judgment.
Spain, J., concurs. Ordered that the appeal from the order is dismissed, without costs.Ordered that the judgment is reversed, on the law, without costs, determination of respondentNew York State Emergency Medical Services Council annulled and petition granted to thatextent.
Footnote 1: "Public need" is defined as "thedemonstrated absence, reduced availability or an inadequate level of care in ambulance oremergency medical service available to a geographical area which is not readily correctablethrough the reallocation or improvement of existing resources" (Department of Health PolicyStatement No. 06-06, at 4 [May 26, 2006]).
Footnote 2: Although Public Health Law§ 3005 indeed contains references to a "valid operating certificate" (Public Health Law§ 3005 [1]) and the determination of "public need" (Public Health Law § 3005 [6]),the phrase "certificate of public need" does not actually appear anywhere therein—anobservation we make only to highlight the often confusing and sometimes inconsistent nature ofthe underlying statutory scheme (see n 3, infra).
Footnote 3: Although the phrase "strongpresumption" is not defined in the statute, we accord the word "strong" the meaning commonlyfound in numerous dictionaries and thesauri, i.e., powerful, substantial and significant. Wefurther note that although the "strong presumption" contained in Public Health Law § 3008(7) (b) presumably was added to replace the "presumption" set forth in Public Health Law§ 3008 (6), the latter subdivision remains—albeit somewhatcuriously—intact.
Footnote 4: Petitioner obtained a stay of thedenial of its application pending the outcome of this proceeding and, as such, continues tooperate its ambulance service to this day.
Footnote 5: The order granting Kunkelintervenor status is not appealable as of right (see CPLR 5701 [b] [1]) and, althoughpetitioner's appeal from the final judgment brings such order up for review, petitioner has notbriefed this issue on appeal. Hence, we deem petitioner's appeal from Supreme Court's order tobe abandoned (see Matter of MichaelOO., 53 AD3d 709, 709 [2008]).
Footnote 6: That said, we note in passingthat there is nothing in the record to suggest that the quality of service provided by eitherpetitioner or Kunkel is in any way deficient.
Footnote 7: Notably, this statutorypresumption is reflected in the Department of Health's "overview," which notes that "[t]hetwo[-]year period of proper operation of the service supports the determination of need"(Department of Health Municipal Certificate of Need [Muni-CON]: An Overview, at 3 [rev2009]).
Footnote 8: Although this Court's inquiryindeed ultimately must distill to whether SEMSCO properly considered such presumption inrendering its determination, an examination of the manner in which REMSCO approached andtreated petitioner's application nonetheless is relevant—both in terms of providing ahistorical context and, more to the point, of demonstrating that the administrative review ofpetitioner's application, as well as the manner in which the statutory presumption was interpretedand applied, was flawed from the outset. This is particularly true given that REMSCO'sdemonstrated analytical shortcomings were in no way mitigated—much lessremedied—by the review process subsequently undertaken by SEMSCO.
Footnote 9: This statement is particularlytroubling, as it not only flies in the face of Public Health Law § 3008 (7) (a) but, to ouranalysis, suggests that REMSCO essentially adopted a "look back" approach and erroneouslyfocused upon whether petitioner should have been granted its initial operating certificate in 2005.In other words, instead of examining the service that petitioner actually provided during thetwo-year period, which, as noted previously, directly speaks to the determination of need(see Department of Health Municipal Certificate of Need [Muni-CON]: An Overview, at3 [rev 2009]), REMSCO opted to dwell upon whether petitioner should have been permitted toenter the ambulance service market at all.
Footnote 10: Notably, one of SEMSCO'smembers insisted that, after the initial two-year period identified in Public Health Law §3008 (7) (a), "[t]he municipalities get no different treatment . . . Once that two yearsexpires they are . . . subject to the same scrutiny as a private . . .ambulance corps must go through in order to prove need and then obtain a certificate." Thatanalysis is not only contrary to Public Health Law § 3008 (7) (b) but, if followed to itslogical conclusion, renders the statutory presumption meaningless and, in essence, dooms amunicipality's application for certification to failure.
Footnote 11: While acknowledging thatSEMSCO, not the Regional Emergency Medical Services Council (hereinafter REMSCO), isstatutorily responsible for making a final determination with respect to public need (seeMatter of Tri-State Ambulance Serv. v State of N.Y. Dept. of Health, 114 AD2d 546, 547[1985]), the majority nevertheless focuses on the manner in which REMSCO consideredpetitioner's application. We disagree that any flaws in REMSCO's process should somehow beattributed to SEMSCO. Accordingly, we are of the view that our review should center onwhether SEMSCO properly considered the presumption.
Footnote 12: Notably, if the Legislaturehad intended to completely eliminate the requirement that a municipality demonstrate publicneed after performing satisfactorily during the initial two-year period, it could have explicitly"deemed" such requirement to have been met and/or imposed an irrebuttable presumption, butdid not do so. In fact, an earlier version of the bill that ultimately passed (S 7660-A, A 10611-A)would have exempted municipal ambulance services from Public Health Law § 3008(see Sponsor's Mem, Bill Jacket, L 1992, ch 850).
Footnote 13: We also disagree with themajority's unsupported assumption that Public Health Law § 3008 (7) was intended toreplace Public Health Law § 3008 (6), a view that is contrary to well-recognized principlesof statutory construction (see e.g. McKinney's Cons Laws of NY, Book 1, Statutes§§ 98, 144, 231). Nevertheless, such difference of opinion is immaterial to the issuehere.
Footnote 14: In view of the fact thatpetitioner was not previously required to demonstrate public need at all, since it was initiallydeemed to satisfy that requirement, we disagree with the majority's criticism of REMSCO's "lookback" approach. Nor do we find it inappropriate to take into account the previously existingcircumstances, in addition to examining the service provided during the initial two-year periodand looking forward to the future ability to provide ambulance services. The record reflects thatpetitioner and Kunkel addressed all of these circumstances and, in our view, SEMSCO properlyconsidered them.
Footnote 15: The comments of one ofSEMSCO's members referred to by the majority do not lead us to conclude otherwise. While weagree that the statute is not a model of clarity and there was undoubtedly some confusion on thepart of this member, when viewed in the light of the entire record of SEMSCO's proceedingssubsequent to such comments, it is evident that the significance and effect of the presumptionwas clarified and discussed at some length.