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Governor Agrees Comptroller Should Again Audit New York State's Economic Development Contracts

ALBANY, NY (WSKG) - After economic development corruption scandals, Gov. Andrew Cuomo and State Comptroller Tom DiNapoli have finalized a plan to restore the comptroller's auditing powers over economic development contracts.

In 2011, Cuomo persuaded the state Legislature to agree to limit the comptroller's oversight ability for some economic development projects. They included the $750 million subsidy for the Solar City project, as part of an initiative Cuomo called the Buffalo Billion.

At the time, Cuomo said the additional oversight slowed down the bidding and construction process.

Since then, bid-rigging and bribery scandals related to the Buffalo Billion initiative as well as other economic development contracts led to federal corruption charges and prison terms for several of Cuomo's former associates, including his former closest aide, Joe Percoco. The former head of the State University of New York's Polytechnic Institute, Alain Kaloyeros, who helped cut the deals for many of the contracts, is also facing a jail term, though he is currently free while appealing his conviction.

Last March, Cuomo and DiNapoli struck a verbal agreement to reinstate the comptroller's audit powers over the projects.  But the actual details of the agreement languished, according to DiNapoli, who spoke about it in late July in an interview with public radio.

"The spirit is there, but the actual translating the intent into a practice hasn't happened," DiNapoli said on July 30.

Government reform groups complained that the governor was dragging his feet in setting up the arrangements -- something Cuomo's office denied.

Late on a Friday afternoon in the middle of August, the governor and comptroller finally issued a joint memo of understanding. It restores the comptroller's oversight authority, beginning on Sept. 15.

John Kaehny with the government reform group Reinvent Albany said that's good news.
"It clearly is a step forward," Kaehny said. "It increases accountability and decreases corruption risk."

The agreement also provides an additional layer of oversight. The state inspector general's office, which is part of Cuomo's administration, will have the authority to review the comptroller's audits. Kaehny said the more oversight the better, and he said the IG's new powers will improve transparency. But he said the inspector general won't have equal powers with the comptroller when it comes to the contracts.

"The inspector general doesn't get to approve them, they just get to see them," said Kaehny, who added that the comptroller has the ability to reject contracts if they believe they are "tainted" or don't meet state requirements.

Kaehny said ultimately, though, the governor and Legislature need to pass a law to restore the oversight powers.

Cuomo did not comment about the finalized agreement. Mark Johnson, a spokesman for the comptroller, said in a statement that "implementation of the agreement" is "an important step forward in enhancing accountability in state contracting."