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Brookhaven Town Local Development Corp cited in audit: DiNapoli

FARMINGVILLE, NY – The Brookhaven Town Local Development Corporation’s board of directors failed to properly approve and oversee about eight projects such as Long Island Community Hospital and Port Jefferson Ferry Retirement Community, an audit of the ‘State.

An audit by State Comptroller Tom DiNapoli’s office found that the projects’ objectives were vague and not clearly defined in the authorization resolutions. For the LICH project, the board approved the issuance and sale of up to $85 million of tax-exempt bonds and up to $20 million of taxable bonds.

Of these amounts, approximately $59 million in tax-exempt bonds and $17 million in taxable bonds were issued to refinance tax-exempt bonds originally used by the hospital in various previously approved projects. to acquire, build, renovate or equip facilities, such as the Knapp Cardiac Center, on the hospital’s 35-acre campus on Hospital Road in East Patchogue.

The project’s application said debt from previously approved projects would be refinanced, creating 31 full-time jobs and one part-time job in the first three years, saying it would “promote and maintain job opportunities, health, the general prosperity and economic well-being of the citizens of the city.

But the authorization resolution did not specify how this would be achieved, according to the audit.

The board also approved the issuance and sale of up to $125 million in tax-exempt bonds for the Port Jefferson Ferry Retirement Project, of which $89 million was issued. for construction and renovation, as well as the installation of machinery.

While the project’s application stated that it would create approximately 42 full-time jobs and two part-time jobs in the first three years, its authorization resolution only stated that the project would “promote and maintain employment opportunities, health, general prosperity and economic well-being”. of citizens of the city and state, and “improve their standard of living,” the audit says.

The resolution was not precise, however, according to the report.

The audit also found that the company also did not determine whether LICH or Port Jefferson Ferry “provided health benefits, improved living standards, or increased the general prosperity and economic well-being of the citizens of the city, all of which were cited as project objectives in the project authorization resolution.

“While the project requests defined job creation and maintenance goals for each project, managers did not incorporate these goals into the resolutions for each project,” the auditors say. “Approving projects without identifying clear and measurable goals that benefit the city is not in the best interest of the public. Had the board passed authorizing resolutions setting out clear and measurable goals, it would have provided specific guidance to nominees and company officials while monitoring project goals.

The auditors recommended that the Board of Directors develop and adopt a written policy setting out procedures for approving and monitoring projects, ensuring that staff collect all required fees, and considering recovering fees not collected.

The board also recommended ensuring authorized resolutions include clear and measurable goals so that managers can easily determine whether projects are meeting intended goals.

Company officials generally agreed with the findings and recommendations and said they would take corrective action, according to the audit.

But, in a May 25 letter to the state, board chairman Frederick Braun wrote that members disagreed with the key finding that the agency had failed to properly approved and monitored the projects, saying the board “examined thoroughly and thoughtfully all information relating to LDC”. applications and projects and each resolution is prepared by the lawyer and duly approved. »

He went on to describe a complex process by which the board and its attorney review a series of documents associated with projects before each resolution is approved.

“Having entities like Jefferson’s Ferry and LICH providing services to residents of Brookhaven is the purpose of and directly impacts the wording of our resolution, which states that the bonds are issued to promote, develop, encourage and assist projects such than the employment promotion project. the opportunity, health, general prosperity, and economic well-being of the people of New York State,” Braun writes.

“In the cases of Jefferson’s Ferry and LICH, their existence – at a minimum – directly improves job opportunities and the health of residents of the town of Brookhaven, which certainly improves employment opportunities,” he said. he continued. “While employment is part of the stated purpose and objective of LDC funding and is monitored and reported, it is only part of tracking project success.”

Braun writes that he read other audits and realized that the state’s response would be that it is “vague and unmeasurable, but I challenge you to provide a measure of the significance of to have a continuing care hospital or retreat center in your community.”

“The purpose of our support is to ensure that our residents have access to health care and that our seniors have the opportunity to age in the community they want to live in,” he wrote, adding, “Your insistence about a goal having to be ‘measurable’ is narrow and lacks the value of having nonprofits providing services. »

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