NYC should replace 9/11 funds erroneously taken by federal government, Mnuchin tells de Blasio

WASHINGTON - Treasury Secretary Steve Mnuchin has a message dated September 11th in New York City for sick firefighters that his agency has withheld funding: We're not giving your money back - ask NYC.
For years, the U.S. Treasury Department has withheld nearly $ 4 million from the New York World Trade Center Health Program Fire Department to pay off unresolved debts held by other non-federal city officials.
Mnuchin sent a letter to Mayor Bill de Blasio on Thursday saying the city should make up the deficit. And if the city doesn't pay, Mnuchin threatened to use other federal health supplies destined for New York and give them to the fire department instead.
“We agree that it is unfair to burden FDNY with criminal debt from other NYC government agencies. City government should reimburse FDNY directly, ”Mnuchin wrote.
And if de Blasio refuses, Mnuchin said the Treasury Department, along with the US Department of Health, will “facilitate offsets against future federal payments to NYC that would allow funds to be released to FDNY when such substitute offsets are made. ”
"The Treasury Department must stop talking and paying twice," said Senate Minority spokesman Chuck Schumer, Angelo Roefaro. “It's their fault and you need to fix it now. Enough now."
US Junior Senator Kirsten Gillibrand agreed.
“The government has withheld nearly $ 4 million from the FDNY and now wants NYC to do it. It's totally unacceptable - the government needs to end this deception and free up the funding New Yorkers need. "
The Treasury Secretary's hardball offer is an unexpected turn in a tangled story.
According to federal law, if a federal agency is unable to collect debts, it refers the debt to the Treasury Department and the so-called Treasury Offset program, which then siphons it off from future federal payments to the debtor.
The treatment program money was sucked up because it is on the same tax card as the rest of the city government.
However, the bill, which was partially authored in 1994 by Rep. Carolyn Maloney, DN.Y., has a loophole that states that Mnuchin can exempt compensation payments if they would harm a program that is supposed to be Congress-funded, such as for example the 9/11 treatment program.
Long Island MP Pete King, R-N.Y., First started asking about the lack of cash earlier this year and put it in a pointed letter back in June when the Treasury Department couldn't find a solution.
When asked about Mnuchin's tough stance on Friday, Maloney again referred to the law she was co-writing.
"It is absurd that Secretary Mnuchin has not yet taken any action to fix the problem," Maloney said. “The Debt Collection Improvement Act (PL 104-134), which I worked on with then Chairman of the Supervisory Committee, Steven Horn, clearly gives the Secretary and his department the ability and discretion to ensure that this program is complete. He has to stop playing with the lives of these heroes. "
FDNY chief physician Dr. David Prezant, who heads the treatment program, told the New York Daily News that it could work despite the warning because the city and the fire department could afford to cover the missing money.
But with the coronavirus emergency and the U.S. Senate's failure to pass more COVID-19 relief laws, the closet is empty. The program includes 21 vacancies that Prezant cannot fill. This means that there are not enough staff available to help those who have fallen ill from their 9/11 service if necessary.
While the law states that Mnuchin has the power to protect such a program from compensation payments, a Treasury Department spokesman insisted it wasn't really a Treasury Department issue, as the money originally came from the Department of Health and Human Services , which operates the National Institute for Occupational Health and Safety as well as the Centers for Medicare & Medicaid Services.
With such a reading, the finance department is classified as a passive mediator, even though it is running the offset program. The spokesman confirmed that HHS would need to ask for a solution, but added that HHS did not believe it had the authority to reimburse previous compensation payments.
According to proponents looking for a solution, it's relatively easy to do. The agency funding the treatment program is the NIOSH, which uses the CMS to send the checks. With the outstanding debt apparently related to Medicare, CMS administrator Seema Verma would only have to write a letter asking Mnuchin not to punish the FDNY.
Verma recently called the situation "unacceptable" even though it does not appear to have taken any action.
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