Treasury Secretary: City at Fault For Feds Shortchanging WTC Health Fund
Months after World Trade Center health advocates accused the Federal Government of siphoning off millions from the Fire Department's 9/11 Health Program, U.S. Secretary of the Treasury Steven Mnuchin has blamed the de Blasio administration for the loss of the funds and asserted it should make them up.
On Sept. 17, 21 Democratic and five Republican Members of Congress—all but one member of the state's delegation—wrote Mr. Mnuchin to demand that the funding be restored "immediately."
Turn Money Loose
"While we do not take a position on that dispute, we are unanimous in our belief that under no circumstances should funds meant for 9/11 responders be caught in the crossfire," the group stated.
In an Oct. 8 letter to Mayor de Blasio, the Treasury Secretary wrote that in reviewing Federal payments since 2004, he found that the Fire Department "has shouldered debts of up to $3.92 million owed by various New York City government departments to the federal government. I agree with the New York Congressional delegation that FDNY should promptly be made whole."
Mr. Mnuchin explained that his agency was required "by law....to withhold unpaid federal debts from federal payments" and that "delinquent debts owed by various New York City government entities, such as the NYC Department of Finance, have resulted in offsets to federal payments otherwise payable to FDNY."
He continued, "We agree that it is unfair to burden FDNY with the delinquent debts of other NYC government entities. The City government should directly reimburse FDNY...If you choose not to pursue this solution, however, Treasury and [the U.S. Department of Health and Human Services will facilitate offsets against future federal payments owed to NYC, which would permit the release of funds to FDNY as such substitute offsets are made."
Mr. Mnuchin said the federal agencies involved with the diverting of the FDNY WTC money had concluded they had "no authority to refund offsets to past payments to FDNY to satisfy valid NYC debts."
The Mayor's Press Office did not respond to a detailed email seeking a response.
Maloney: Power to Exempt
U.S. Rep. Carolyn Maloney has maintained throughout the controversy that under legislation she authored in 1994, Mr. Mnuchin has the statutory flexibility to exempt the FDNY WTC Health program grant money from being diverted to pay off unrelated city debts.
"It is absurd that the Secretary Mnuchin hasn't yet taken action to rectify the problem," she told the Daily News after it reported the shortfall last month. "The Debt Collection Improvement Act...clearly gives the Secretary and his department the ability and discretion to make sure that this program is made whole. He needs to stop playing games with these heroes' lives."
Further support from House Democrats for restoring the funding came in a letter from U.S. Reps. Richard Neal, who chairs the Ways and Means Committee, and Frank Pallone Jr., head of the Committee on Energy and Commerce. In an Oct. 13 letter to Mr. Mnuchin prodding him to release the money, they wrote, "The Administration should do everything within its power to ensure that firefighters who still face health challenges due to the toxins they encountered at Ground Zero get the care they deserve."
"This money was approved by our funding agency, the National Institute for Occupational Safety and Health, and then taken back by the Treasury without any notice," Dr. David Prezant, the FDNY's Chief Medical Officer, texted this newspaper. "These funds, every dollar, are used for patient care. I guess the [U.S.] Treasury Department feels patient care is no longer necessary. Our patients and their families would disagree."
The program covers screening for thousands of firefighters and Emergency Medical Technicians who were at the Trade Center site on 9/11 or in the months after as part of the recovery and clean-up efforts that continued through May 2002.
Advocate: Claim 'Ridiculous'
Ben Chevat, the executive director of 9/11 Health Watch, a non-profit advocacy group, said Mr. Mnuchin's letter failed to cite any legal basis for the Federal Government to withhold the FDNY money.
"It is ridiculous," he said during a phone interview. "It is clear the Secretary of the Treasury can exempt the program, and Mnuchin's letter contradicts the previous correspondence from his agency."
On Sept. 30, Deputy Assistant Treasury Secretary Frederick Vaugh wrote Ms. Maloney that "there are options, short of legislation, that potentially could protect the FDNY payments from offset" and that it might be eligible for an exemption.
He also noted the withholding of the money was also the consequence of the City of New York using the same Taxpayer Identification Number or Employer Identification Number across all its agencies.
"Alternatively, FDNY can obtain its own Employer Identification Number," Mr. Vaugh suggested, saying it could be applied for online and "issued immediately" by the IRS.