Reinvent Albany advocates for transparent and accountable New York State government and has closely followed the Penn Station Redevelopment project.
We are testifying to put on record our concerns about Empire State Development’s ongoing refusal to publish important findings and data produced by Ernst & Young Infrastructure Advisors, LLC (“Ernst & Young”) that could give elected officials and the public a clearer understanding of the Penn Station Redevelopment project.
The New York State Freedom of Information Law says:
“The people’s right to know the process of governmental decision-making and to review the documents and statistics leading to determinations is basic to our society. Access to such information should not be thwarted by shrouding it with the cloak of secrecy or confidentiality.”
Unfortunately, in the case of the Penn Station Redevelopment project, ESD acts as if it is not guided by this basic philosophy and seems to have forgotten that in strong democracies, governments work for the public — not businesses and campaign contributors. Our sense is that ESD deliberately uses consultants like Ernst & Young to avoid disclosing embarrassing or inconvenient facts to the public and elected officials. One way ESD does this is by claiming the “trade secret exception,” which holds that the consultant’s analysis or modeling is exempt from public disclosure because it would hurt the consultant’s business. We ask ESD to make an honest commitment to transparency instead of coming up with endless excuses about why the public cannot be told how our tax dollars will be spent.
Under consideration by the Directors is a second amendment to ESD’s contract with Ernst & Young, which extends the contract to December 2023 and adds an additional $300,000. If approved, the contract will run through December 2023 at a cost not to exceed $1,200,000.
The scope of the initial contract between Ernst & Young and ESD is described in the approval made by the ESD Board on March 26, 2020 as follows:
- Develop a financial tool to be used by ESD to calculate projected financing revenues
- Assist ESD in identifying feasible options for potential revenue sources to fund improvements within the Empire Station Complex
- Assist ESD in evaluating various strategies for financing improvement
- Survey best practices in different financing, procurement, and project delivery paths
- Provide strategic financial advice to assist in stakeholder conversations
- Provide other financial advisory services for the project as requested by ESD
When the contract was first amended at ESD’s July 2021 Board meeting, the following was added to the scope of work:
- Evaluate various strategies for financing improvements in the Empire Station Complex District and advise ESD on best practices in different financing, procurement, and project delivery paths, including identification of federal and local funding sources and requirements, and financial modeling of various alternatives.
- Provide financial analysis and advisory services with regard to Penn District real estate development, including development and refinement of financial tools and models, to assist in conversations and negotiations with local stakeholders.
- Provide other financial analysis, advisory services, and other strategic advice as requested by ESD.
Reinvent Albany is very aware of the changing economic landscape surrounding the Penn Station Redevelopment project and the need for ongoing financial analyses, especially in light of the recent announcement by Vornado that it will be delaying development.
The stated goal of ESD’s Penn Station redevelopment project is to fund the State’s share of Penn Station renovations and potential expansion. Incredibly, given the amount of public attention the Penn Station project has gotten, ESD has still not disclosed an analysis that shows exactly where it thinks the money is coming from and the economic and financial assumptions its thinking is based on.
On January 7, 2022, ESD denied a Freedom of Information Law (FOIL) request filed by Reinvent Albany seeking records related to Ernst & Young’s scope of work. ESD claims that disclosure of the records would impair present or imminent contract awards, presumably with developers.
We again urge this Board of Directors to work hard on actually being transparent. You live in a democracy. Act like it. Stop shrouding the Penn Station Redevelopment project in a cloak of secrecy and confidentiality.
Show the public what you intend to do with our money.
Thank you for the opportunity to submit written testimony. Please send any questions to Elizabeth Marcello at elizabeth [at] reinventalbany.org.