| Matter of Bais Sarah Sch. for Girls v New York State Educ.Dept. |
| 2012 NY Slip Op 07175 [99 AD3d 1148] |
| October 25, 2012 |
| Appellate Division, Third Department |
| In the Matter of Bais Sarah School for Girls, Appellant, v NewYork State Education Department et al., Respondents. |
—[*1] Eric T. Schneiderman, Attorney General, Albany (Kathleen M. Treasure of counsel), forrespondents.
Garry, J. Appeal from a judgment of the Supreme Court (McGrath, J.), entered August 18,2011 in Albany County, which dismissed petitioner's application, in a proceeding pursuant toCPLR article 78, to review a determination of respondent Education Department terminatingpetitioner's participation in the Summer Food Service Program.
In 2008, petitioner, a private school that operates a residential summer camp in the Town ofLumberland, Sullivan County, became a sponsor in the federally funded Summer Food ServiceProgram (hereinafter SFSP), which provides free meals to children from low-income areasduring school vacations (see 42 USC § 1761; 7 CFR part 225). Respondentsadminister SFSP and monitor sponsors to ensure that they adhere to its regulatory requirements(see 7 CFR 225.3 [b]; 225.6, 225.7). SFSP sponsors are paid according to the number ofchildren served at each meal and are required, among other things, to "maintain accurate recordswhich justify all costs and meals claimed" (7 CFR 225.15 [c] [1]). A sponsor may be terminatedfrom SFSP for failing to maintain such records, claiming payments for meals that were notserved or other serious deficiencies in operating the program (see generally 7 CFR 225.11[c]). A sponsor found to have committed "a high level of meal service violations" must berequired to take immediate corrective action (7 CFR 225.11 [f] [1]) and is subject to terminationfrom SFSP if it fails to do [*2]so (see 7 CFR 225.11 [f][2]).
In 2008 and 2009, petitioner was repeatedly found deficient for regulatory violations, leadingto its termination from SFSP in 2009. In 2010, petitioner applied for reinstatement and submitteda corrective action plan, which was approved by respondent Education Department afterpetitioner entered into a written agreement to correct the prior deficiencies and comply with allregulatory requirements. In July 2010, Department employees conducted a site review ofpetitioner's breakfast service. The employees saw only 105 children being served breakfast,although petitioner had reported serving approximately 360 children on each of the previous fivedays. Members of petitioner's staff provided varying explanations for the discrepancy. Thereafter,the Department issued a notice of action that detailed these findings and other problems observedduring the review, and directed petitioner to institute specified corrective measures. Petitionerresponded with a letter disputing the accuracy of the findings and did not implement thecorrective measures. In August 2010, the Department notified petitioner that its participation inSFSP was terminated and that the termination rendered petitioner ineligible for reimbursementfor the 2010 SFSP. Petitioner requested a hearing to appeal the termination.[FN*] The Hearing Officer upheld the Department's determination, and petitioner thereaftercommenced this CPLR article 78 proceeding. Supreme Court dismissed the petition, andpetitioner appeals.
"Where, as here, [a] petitioner challenges an administrative determination made where ahearing is not required, appellate review is limited to whether the determination lacks a rationalbasis and is, thus, arbitrary and capricious" (Matter of Figel v Dwyer, 75 AD3d 802, 804 [2010] [citationomitted]; see CPLR 7803 [3]; Matter of Raymond Hadley Corp. v New York State Dept. of State, 86AD3d 899, 900-901 [2011]). We agree with Supreme Court that the Department's decisionto terminate petitioner's participation in SFSP did not lack a rational basis. Prior to the July 2010site review, petitioner had been found to have overstated the number of meals it served on fourseparate occasions, in addition to other program violations. Its 2010 reinstatement into SFSP wasexpressly conditioned upon its compliance with a corrective action plan to remedy theseproblems, and the July 2010 review was undertaken to verify whether the deficiencies had beencorrected. Petitioner's explanation for the discrepancy between the number of breakfasts it servedon the morning of the review and the much higher numbers it had reported for the precedingseveral days was that approximately 250 children had left the camp early that morning to attend afield trip, had returned when the trip was canceled for weather-related reasons and were sleepingwhen the Department conducted its review. However, petitioner had not provided theDepartment with the required advance notice of the field trip (see 7 CFR 225.16 [c] [4]),and petitioner provided incomplete, inconsistent documentation to support its claims that the triphad been scheduled and that petitioner had unsuccessfully attempted to notify the Department.The Department also identified other problems during the review, including petitioner's failure todemonstrate that trained staff were available to administer SFSP, maintain an organized systemfor SFSP records, and make these records readily available to the Department for review.
In addition to the deficiencies identified during the review, petitioner did not comply [*3]with the corrective action measures required by the Departmentthereafter. In this regard, petitioner argues that one of the measures required by theDepartment—the use of a sign-in sheet at each meal—was impossible to implementin a program serving 400 children, some of whom were allegedly too young to write their names.Petitioner does not, however, claim that it could not comply with the other specified correctiveactions—such as identifying an administrator in charge of SFSP or maintaining all SFSPrecords in a single location—nor does it explain why it did not do so, other than arguingthat the requirements were "unacceptable." Notably, the regulation governing termination forfailure to comply with a corrective action plan is phrased in mandatory terms, providing that theDepartment "shall terminate" a sponsor's participation if it does not implement timelycorrective measures after program violations have been identified (7 CFR 225.11 [f] [2][emphasis added]). Accordingly, the Department's decision to terminate petitioner's participationfor serious deficiencies in its administration of SFSP was not arbitrary and capricious(see 7 CFR 225.11 [c] [4] [ii], [v]; [f] [1], [2]).
Petitioner next contends that the Department is not authorized to deny reimbursement formeals that were served before its termination. However, as Supreme Court noted, the HearingOfficer discussed only the issue of termination, and nothing in the administrativerecord—which includes all the documents upon which the Hearing Officerrelied—indicates that petitioner addressed the issue of reimbursement in the administrativeappeal. As "an argument may not be raised for the first time before the courts in [a CPLR] article78 proceeding," the issue is not properly before this Court, and Supreme Court correctly declinedto address it (Matter of Peckham vCalogero, 12 NY3d 424, 430 [2009] [internal quotation marks and citation omitted]; see Matter of Veltri v New York State Off.of the State Comptroller, 81 AD3d 1050, 1054 [2011]; Matter of Williams v Goord, 37 AD3d948, 948 [2007], lv denied 8 NY3d 1021 [2007]).
Mercure, J.P., Malone Jr., McCarthy and Egan Jr., JJ., concur. Ordered that the judgment isaffirmed, without costs.
Footnote *: The regulations governingappeals do not require hearings unless requested by a sponsor (see 7 CFR 225.13 [b] [5]).