New York State Public-benefit Corporations - Controversy

Controversy

Some of these corporations, particularly the "authorities," are criticized as being wasteful or overly secretive. There are literally hundreds, more than 640 as of 2004 according to a New York Times editorial. Some attempts at reform have been made. According to the editorial:

Hevesi has offered a comprehensive bill that incorporates some of the best ideas in other legislation circulating in Albany . It would also create a commission to assess whether all 640 authorities set up over the last 80 years still need to exist. The Overcoat Protection Authority, for one, would seem to have had its day.

The Overcoat Protection Authority actually is not the correct name of the entity in question. The correct name of the entity the Times was speaking of is the Overcoat Development Corporation, which was designed to lure a clothing manufacturer to New York from Indiana in the 1980s.

Lack of oversight is a major concern with New York's authorities. According to the Associated Press:

Out of 643 state and local authorities in New York, only 11 need approval by the Public Authorities Control Board before selling bonds. The comptroller's office gets financial reports from just 53.

In 2004, the New York State Comptroller's Office, headed at the time by Alan Hevesi, became concerned about the debt public authorities were generating:

Most public authorities have the ability to borrow funds by issuing debt. Total public authority debt reached more than $120.4 billion in 2004, and continues to grow. $37 billion of this debt is State-supported, accounting for more than 90 percent of total outstanding State-supported debt.

Recently, the state has been trying to phase out public benefit corporations and authorities it considers unnecessary.

Read more about this topic:  New York State Public-benefit Corporations

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