NYC, NYS comptrollers dig up dirt in audits
Wednesday, September 21, 2011 - 05:58 PM
The Economic Development Corporation set over this statement in response to Comptroller Liu's audit. From EDC spokesperson Patrick Muncie:
We appreciate the Comptroller’s analysis, and we’re glad it determined that EDC has disbursed a vast majority of the funds available for community benefit. The Comptroller’s suggestions for the remaining funds may be well-intentioned, but they ignore the disbursement restrictions EDC is legally bound to follow, and many are infeasible or simply not in the best interest of the City’s taxpayers. We will continue to ensure that all of the funds are wisely invested in the neighborhoods for which they were intended.
For time's sake I'm condensing two separate audits released today--one by New York City Comptroller John Liu, the other by New York State Comptroller Thomas DiNapoli.
Liu finds millions in unspent city development funds
The comptroller's office says an audit found $9.3 million in unspent funds meant for public benefit projects on the Economic Development Corporation's books. The bulk of the funds were approved in 1992 as part of a development deal, and meant benefit the Harlem River Rail Yard in the Bronx.
“It makes little sense that millions intended for economic development remain unused for so long, especially in the Bronx where jobs are greatly needed,” Liu said in a statement. “If the EDC can’t figure out how to put the capital to work then at least return the money to the City treasury.”
DiNapoli's audit of the MTA confirms the agency's deep fiscal woes
According to a report put out by DiNapoli's office, many of the concerns over the sustainability of the MTA's capital program were well founded. An audit of the agency revealed considerable risks in the financial assumptions its making, and warned that taking on more debt would only complicate things.
“The MTA is in a very difficult position as it struggles to hold together a strained operating budget while proposing the largest borrowing program in its history to fund capital projects,” DiNapoli said in a statement. “Before taking on nearly $15 billion in new debt, the MTA must present the public with the facts about the potential long-term implications of this new borrowing on services, fares and budget gaps.”
The comptroller warned that, if the MTA took on the proposed debt, the interest paid on what the agency owed could reach $3.3 billion by 2018. That would be 64 percent more than it is this year. DiNapoli projected that, even with scheduled fare and toll increases, the MTA could still face a budget gaps rising from $600 million in 2016 to $1.2 billion in 2018.
All of this, of course, would be waiting for whomever Governor Andrew Cuomo picks to replace departing MTA head Jay Walder later next month.
“The next MTA Chairperson will face a number of challenges including negotiating new collective bargaining agreements, squeezing additional savings from the operating and capital budgets, and keeping fares affordable in the face of rising debt service costs for the capital program,” DiNapoli said.