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NYS Comptroller

THOMAS P. DiNAPOLI

Taxpayers' Guide to State and Local Audits

Empire State Development
Selected Personal Service Contracts


Issued: April 1, 2014
Link to full audit report 2011-S-53
Link to 90-day response

Purpose
To determine whether two selected Empire State Development Corporation (ESDC) personal service contracts were necessary, appropriately procured and monitored to ensure service delivery as required by ESDC guidelines. The audit covers the period April 1, 2007 through December 14, 2012.

Background
ESDC is a public benefit corporation whose mission is to promote a growing and vigorous economy and encourage job creation and economic opportunity. We audited two judgmentally selected personal service contracts. The first was a contract with BDO Consulting (BDO) for integrity monitoring of ESDC's expansion and renovation project at the Jacob K. Javits Convention Center. The second was an $870,000 contract with a housing portfolio consultant, Adrienne Driben, with whom ESDC has been contracting since April 2004.

Key Findings

ESDC adopted procurement guidelines governing the need, award and monitoring of procurement contracts as required by the Public Authorities Law. We found that ESDC officials were not in compliance with many of these requirements for both the BDO and Adrienne Driben personal service contracts. We also found that ESDC officials did not enforce several contract terms with these vendors. As a result, there is diminished assurance that the contracts with these two personal service contractors for nearly $3.9 million were necessary, appropriately procured and monitored to ensure service delivery.

Key Recommendations

  • Change the control environment at ESDC to one that supports compliance with procurement guidelines and laws and enforces contract terms.
  • Strengthen monitoring practices to ensure that criteria for contractor performance are in place, communicated to the relative parties and used in contract oversight.

Other Related Audits/Reports of Interest

Empire State Development Corporation/New York State Council on the Arts: Unnecessary and Potentially Illegal Consultant Contract With Former New York State Council on the Arts Executive Director (2011-S-6)
Empire State Development Corporation: Personal and Miscellaneous Services Contracts (2009-S-62)


State Government Accountability Contact Information:
Audit Manager: Brian Mason
Phone: (518) 474-3271; Email: StateGovernmentAccountability@osc.state.ny.us
Address: Office of the State Comptroller; Division of State Government Accountability; 110 State Street, 11th Floor; Albany, NY 12236