Bleakley Platt Prevails in Case of First Impression on HEAL Grant Funding

July 2009

On June 30, 2009, Bleakley Platt obtained a decision by the Appellate Division, Second Department, denying plaintiffs’ motion for preliminary injunctive (PI) relief and dismissing the complaint against our Firm’s client, Orange Regional Medical Center (ORMC) with respect to the issue of whether ORMC was required to pay prevailing wage rates for all electrical contracting work being performed on ORMC’s ongoing $306 million construction project. The project will replace ORMC’s two current hospitals with a brand new, state of the art medical facility in Wallkill, New York – the first new freestanding hospital to be built in New York State in more than 20 years.

The case raises an issue of first impression concerning whether ORMC’s receipt of a $24.6 million grant from the N.Y.S. Department of Health pursuant to the Healthcare Efficiency and Affordability Law for New Yorkers (“HEAL NY”) had the effect of requiring the entire $306 million of construction work on the new hospital to be performed at prevailing wage rates or whether only the construction work funded by the HEAL Grant had to be performed at prevailing wage. Reversing the lower court, the Second Department ruled in favor of ORMC’s position that only the work funded by the HEAL Grant needs to be performed at prevailing wage rates.

The June 30 decision allows ORMC to proceed with the new medical facility construction project. BPS Partners, William M. Murphy and William P. Harrington, represented ORMC in the case with the assistance of Susan Galvao and Robert Meade. Bill Murphy successfully argued the appeal.