October 10, 2013

Tompkins County Organization ‘Censured’ by New York State Office

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The New York State Authorities Budget Office announced Thursday that it has censured 13 public authorities, including Tompkins County Area Development, Inc., for failing to comply with state law.

TCAD is an organization that assists local entrepreneurs in creating high-tech companies and helps existing manufacturers expand, according to Michael Stamm, president of the organization.

Stamm disagreed with the censure — a form of public reprimand — on TCAD, arguing that his organization does not fall under the jurisdiction of the state Authorities Budget Office.

The office is responsible for overseeing public authorities in the state of New York to ensure they are more accountable. In a letter sent on Oct. 1, the budget office slammed TCAD for its lack of timeliness and transparency with its financial reporting, adding that the authority was warned multiple times that it was out of compliance with state laws.

“This behavior demonstrates a fundamental misunderstanding of your fiduciary responsibilities and is a serious violation of your duty as a director or officer of this authority,” the letter addressed to the directors said.

The budget office warned TCAD on multiple occasions with letters dating back to Oct. 2008, according to the letter it sent to TCAD. In March, the budget office gave an ultimatum stating TCAD had until April 30 to comply with state law.

Stamm, however, argued that his organization is not a public authority and does not need to comply with the reporting requirements that the budget office outlines. “They can tell us we should comply with the law, but they really are incorrect with that judgement,” Stamm said, adding that TCAD has been expecting the censure letter and that they expect no impact from the censure.

Stamm said that based on TCAD’s reading of the law and the organization’s legal counsel, TCAD is not a government organization and does not fall under the budget office’s jurisdiction. Currently, the organization holds a contract with Tompkins County. “We’re a private not-for-profit organization. Our mission is to create quality jobs for local residents,” Stamm said.

Censure letters were sent to public authorities who failed to comply with the law due to the “collective failure” of the directors to act in response to previous warnings, according to a press release given by the budget office. “The board members of these 13 authorities were given every opportunity to comply with state law,” David Kidera, director of the budget office, said in the press release.

“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.” TCAD’s legal counsel will send a letter to the Authorities Budget Office disagreeing with the censure, and TCAD will try to put this issue behind them, Stamm said.

“We’re just one of dozens of organizations in New York State that have received a letter like this,” Stamm said. “We’re going to spend our time more usefully focusing on our core mission and not allow ourselves to be distracted by this issue.”