December 19, 2016
By Stephanie West
New York State Comptroller Thomas P. DiNapoli has proposed changes to the state’s procurement practices in the wake of criminal charges and allegations of corruption in the awarding of contracts for state economic development projects.
“The alleged contracting and kickback schemes uncovered by federal and state prosecutors show lax oversight over economic development spending,” DiNapoli said. “The state funneled taxpayer money to quasi-government organizations, avoiding scrutiny and sidestepping usual procurement practices. This created an environment ripe for self-dealing and abuse. New York state must take credible steps to reestablish the public’s faith in government and address the broader problems.”
By state law, the State Comptroller’s office is responsible for reviewing and approving state agency contracts above $50,000 and certain contracts over $1 million for state public authorities. The Comptroller’s independent oversight helps ensure that the process is fair and gets the best value for taxpayer dollars. In 2015, the Comptroller’s office reviewed 21,381 contract transactions totaling $169.2 billion.
In recent years, executive and legislative actions have eroded the Comptroller’s contract oversight. In 2011, this oversight was eliminated for construction and construction-related services contracts, among other purchases, issued by the State University of New York (SUNY) and City University of New York (CUNY). In 2012, the Comptroller’s oversight of Office of General Services (OGS) centralized contracts was removed.
In 2015, state agencies issued over $6.8 billion in contracts without Comptroller review.
DiNapoli’s comprehensive package of reforms increases independent oversight of contracts, prohibits the state from using state-affiliated not-for-profits to do state business, makes procurement requirements uniform, and toughens ethics and transparency rules.