Quoted from 191

who the hell do you think you are telling the state what they can and cant do over here?

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Audit reveals budget busters
Schenectady's Metroplex defends itself from state criticism of overspending for downtown projects; parking loss

By TIM O'BRIEN, Staff writer
First published in print: Saturday, July 4, 2009

SCHENECTADY -- A state audit of the Metroplex Development Authority, the taxpayer-funded agency leading efforts to revitalize downtown Schenectady, says eight major downtown projects overseen by the authority ran over budget and authority records do not clearly explain why.

Those projects include a movie theater, hotel and the Proctors Theatre expansion and surrounding streetscape.

The state Comptroller's Office also faulted Metroplex for running a flawed parking system that lost millions in revenue and allows people to get out of paying if they retrieve their vehicles after attendants leave at 5 p.m.

The report also questions $1.4 million the authority paid to lawyers, accountants and other outside professions. Metroplex spent $750,000 on the professionals without seeking competition for the work, the audit contends.

Officials of the development agency disputed the findings, saying any cost increases were discussed in public session and approved, Only one consultant did not have a contract and that has been remedied, they said. And they vehemently oppose charging people to park downtown, saying they lose money on free parking to bring visitors to the heart of the city.

"None of the findings are really earth-shattering," said Ray Gillen, chairman of the Metroplex Board. "They tried to look at us like a business. We're not going to charge for parking right now. They want us to charge the shoppers and visitors downtown. We don't think that helps us turn around downtown."

Metroplex officials responded to the state audit with a lengthy rebuttal, listing each project, why costs increased and the public discussion that occurred.

"Metroplex is not effectively monitoring project performance," the comptroller's audit states. "For example, there was only limited evidence that steps were taken by Metroplex officials to ensure that sponsored projects reasonably met their employment projections."

None of the 16 projects examined by the comptroller's office had reported current employment information by Dec. 31, 2007, the last date of the two-year period the audit examined. The most current information had been filed June 30, 2006 by only five of the projects.

"None of the projects met their job projection goals," the report said, and Metroplex did not impose penalties on any of them.

The audit also said the board's minutes provided no rationale for its funding decisions.

"We respectfully disagree with this finding," the agency responded in written comments.

Metroplex was supposed to provide no more than 50 percent of any project's costs, the audit said. In the case of the renovation of a former boxing gym, Metroplex provided 75 percent of the funding.

The agency said the severely deteriorated building was located across from Proctors and the new Hampton Inn. The building's renovation costs came under budget by almost $46,000, and the building was sold last year for $500,000 to Bombers Burrito Bar. Metroplex will get 5 percent of the interest on the sale, enabling it to recoup its entire investment of $574,850.

The report said the agency is fiscally sound, but its costs increased more than $628,000 between 2006 and 2007, while revenues dropped $529,000.

The most heated debate focuses on the agency's lost parking revenues. For 2007, Metroplex spent $1.23 million on parking operations while taking in only $506,000, the audit says.

"Since 2004, when Metroplex acquired the parking facilities, reported operating losses have totaled $3,158,300," the audit said. The agency also paid more than $5 million to acquire the parking garages and surface lots.

Proctors and Bow Tie Cinemas draw almost 700,000 visitors downtown, Gillen said.

"We reject their recommendation to start charging visitors. We think we know more about urban economic development than they do," he said. "You don't pay for parking at Colonie Center."

The audit contends that people can avoid parking fees simply by waiting for attendants to leave. Gillen responded that everyone can park free for two hours. If a car is on a lot longer than that, the attendant leaves a bill on the windshield and records the license plate.

The state audit also criticized the agency's use of consultants.

During 2007, it said Metroplex paid almost $1.4 million to six consultants, but there were contracts for only three of the six totalling $750,900.

"Metroplex officials do not have adequate assurance that professional services are acquired of suitable quality at the best price and that services were provided as originally required," the audit said.

The board replied that only one legal firm hired by a previous board in 2000 had no contract, although that firm was paid at an hourly rate. That has since been corrected.

"We provided information about 32 different professional service contracts that were awarded on a competitive basis," the agency stated. "For the OSC report to say that three of six professional service contracts it reviewed were issued without competitive bidding is inaccurate. All six were awarded in compliance with procurement regulations."

Tim O'Brien can be reached at 454-5092 or by e-mail at tobrien@timesunion.com.