The New York State Authorities Budget Office announced today that it has censured the boards of directors of 13 public authorities, including the Mount Vernon Urban Renewal Agency, for “persistent failure to comply with state law.” None of the other 12 authorities is in the Lower Hudson Valley.
“The board members of these thirteen authorities were given every opportunity to comply with state law,” David Kidera, director of the Authorities Budget Office, said. “We were compelled to take this enforcement action when directors neglected their legal responsibilities over several years and failed to respond adequately to previous warnings issued by our office.”
The authorities that received the letters for not taking the appropriate action even though their directors previously had been warned they were out of compliance with the law. Continuing to ignore their obligations is unacceptable. This continued inaction demonstrates a fundamental misunderstanding of a director’s fiduciary responsibilities,” the Authorities Budget Office said in a statement.
“As of October 1, 2013 the Mount Vernon Urban Renewal Agency remains out of compliance with the public disclosure, reporting and corporate governance provisions of Public Authorities Law,” the state wrote in a letter to Mayor Ernest Davis and the board of directors of the city’s Urban Renewal Agency. “In addition, our records indicate that the board has failed to meet its statutory obligation to participate in mandatory training that focuses on the governance, accountability and ethical responsibilities of directors.”
The Authorities Budget Office was created to oversee, study and report on the operations, practices and finances of public authorities. It opened in March 2010 with the goal of making what’s been called a “shadow government” of more than 500 state and local quasi-public agencies more accountable to the public. Authorities have long been criticized for being able to incur debt and undertake major development projects with little public oversight.
A total of 38 authorities, including the 13 announced today, have been censured since October 2011.
Disclosure of a censure letter may be required under federal securities law if an authority enters the bond market in the future.