Last week, the New York Daily News ran a devastating editorial criticizing the auditors in the New York State Comptroller’s Office. It was a good editorial, but it failed to understand the inner workings of the Office.
There are two classes of employees – career professionals and political appointees. The career professionals have to report to the political appointees.
In fact, all audits must be approved by the political appointees before any work can be started.
The career professionals were calling for audits of the on-going construction at the World Trade Center. This is one of the largest construction projects in the world and should rightfully have been on the radar screen.
Unfortunately, the political appointees simply did not want the construction projects audited – an area that auditors know is ripe for fraud, waste and improper transactions. This is an area that can produce significant cost savings and can prevent shoddy work from proceeding if it is identified early on.
Years ago, the Comptroller’s Office was run at the political level by professionals with credentials. Unfortunately, under convicted felon Comptroller Alan Hevesi, the tilt toward appointees with no background in accounting or auditing began. Mr. Hevesi fired one of the country’s top accountants and put in place a person without the credentials for the job. That pattern remains today.
It’s a sorry state of affairs when talented career professionals are constrained from doing their job by political considerations.
The current organizational structure of the New York State Comptroller’s Office simply does not provide the auditors with the level of independence needed to properly carry out the job.
You can read the Daily News editorial at:
As they target the Port Authority for the mother of all audits, Govs. Cuomo and Christie have shown zero interest assigning the job to New York State's chief auditor, Controller Tom DiNapoli.
And who can blame them? DiNapoli has a well-established record of firing pop guns at charging grizzly bears.
Consider the Port Authority report DiNapoli put out on Wednesday - two days before the PA's vote on major toll and fare hikes.
Focusing on overtime, DiNapoli made out like he had discovered a motherlode of waste that was blowing holes in the authority's books - and setting up bridge and tunnel users to be hammered.
As DiNapoli knew, the PA's cash crunch has little to do with its $86 million tab for OT - which is less than 4% of a $2.5 billion operating budget.
Since the authority has kept those expenses flat for three years, DiNapoli failed to show any actual waste. The worst he could tut-tut was that "the agency should take a long, hard look at whether its business model for managing overtime really makes sense."
Yes, please, a long hard look.
What really drove the toll hike was a multibillion-dollar gap between collections - which fell dramatically in the economic meltdown - and what the authority needs to complete rebuilding the World Trade Center while keeping bridges, tunnels and airports in shape.
But DiNapoli did not tackle the crucial question that Cuomo and Christie want answered in an audit to be done by an outsider: Which planned projects should be chucked and how can contracting costs be driven down?
Small-bore auditing is standard for DiNapoli.
A few weeks ago, he and city Controller John Liu teamed up for a look at how the Metropolitan Transportation Authority handles construction-related service disruption. They found no real mismanagement, but trumpeted their nonfindings to pander to inconvenienced subway riders.
On Friday, DiNapoli announced with fanfare that he was dispatching crack auditors to the New York State Fair, "to ensure reliable reporting of Midway ticket sales." Go get 'em.
Lest we forget, DiNapoli is a child of the Legislature - being appointed originally counter to the advice of the select committee established to recommend successors to Hevesi. Shelly Silver took over the Office of the State Comptroller.
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