City dodges $6 million bullet on training agency case

LYNN – A bid to recoup $6 million in job training money would have bankrupted the city, says its top attorney, if all parties in the state lawsuit had not agreed this week to dismiss the case.
The $6 million represented federal money that state employment and training officials claimed the now-defunct North Shore Employment and Training (NET) agency “misexpended” between 1994 and 1996.
North Shore Employment operated out of the JB Blood building on Wheeler Street as a training agency for people facing serious employment obstacles. The agency was one of several allocated federal training money in the 1980s and 1990s.
A state administrative judge in March of 1996 ruled the city was responsible for paying back federal Job Training Partnership money. A series of legal challenges by the city reduced the amount owed to $6 million.
City Solicitor Michael Barry, in challenging the state ruling, argued NET, not the city, received the money.
“Lynn should not have been penalized simply because the executive offices of NET were located in the city,” Barry said.
State employment officials have insisted through the 13 years since the initial ruling the city is responsible for paying back the money. Assistant Attorney General Sookyoung Shin repeated that claim in a court document filed this week in Superior Court, but she said the state “determined not to seek judicial enforcement of the decision due solely to the current, particularly severe, economic conditions faced by Lynn.”
Barry said reasonable minds came together and decided to set aside the state’s claim.
“I also believe that the state recognized that any decision requiring the city to repay in excess of $6 million would essentially bankrupt the city,” he said.