The State Worker

Chronicling civil-service life for California state workers

June 30, 2011
Column Extra: Union says Don Novey playing bankruptcy games

With just 400 to 450 words for our weekly State Worker column, most of what we learn each week never sees print. Column Extras give you some of the notes, the quotes and the observations that inform what's published.

Our column in today's Bee notes that the California Correctional Peace Officers Association is both a debtor and a creditor.

Debtor: The state is restarting litigation to force the union to pay millions of dollars owed on its union paid leave tab with the departments of Mental Health and Corrections and Rehabilitation. The sides disagree on how much is owed.

Creditor: A lawyer representing the state's prison officers' union has filed several objections to a bankruptcy plan submitted by the former president of the state's prison officers' union that dumps tens of thousands of dollars in debt he owes.

Don Novey's plan would shed all unsecured debts, including the $20,000 he owes to the California Correctional Peace Officers Association from an arbitrated resolution to a contract dispute. Novey and his wife, Carol, owe much more than that in credit card and other unsecured debt, but CCPOA was the lone creditor to question the Noveys during a contentious bankruptcy hearing last week. This post has more details about the bankruptcy filing itself.

CCPOA attorney Barry Spitzer, whose questions during the hearing indicated he thought the couple undervalued or hid their assets, put his suspicions in writing and filed them with the court on Thursday.

"(CCPOA) hereby objects to the confirmation of the Debtors Chapter 13 plan as not being proposed in good faith," Spitzer wrote in a three-page document. Among his allegations:

>> The Noveys' gross income totaled more than $1.5 million from 2008 to 2010, during which time they didn't pay some taxes and ran up credit cards, "yet claim no significant assets." So where's the money?
>> The Noveys have overstated their IRS tax debt by about $30,000.
>> The Scottsdale, Ariz., condo they've claimed is a rental (and therefore protected property in bankruptcy) is actually a second home.

A hearing date is set for July 19 at 9:32 a.m.
Objection to confirmation of Novey bankruptcy plan

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About The State Worker

Jon Ortiz The Author

Jon Ortiz launched The State Worker blog and a companion column in 2008 to cover state government from the perspective of California government employees. Every day he filters the news through a single question: "What does this mean for state workers?" Join Ortiz for updates and debate on state pay, benefits, pensions, contracts and jobs. Contact him at (916) 321-1043 and at jortiz@sacbee.com.

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