Watchdogs Support Comptroller’s Proposed Ban on Secret Slush Funds

DiNapoli Report: “Eliminate State Discretionary Lump Sum Appropriations”

Transparency and government watchdog groups issued a statement of support for Comptroller DiNapoli’s call to prohibit state discretionary lump sum expenditures, like the $1.3B State and Municipal Facilities Program. (SAM)

Common Cause NY and Reinvent Albany have frequently called attention to lump sum spending, and believe these secretive expenditures create a high risk for corruption and pay to play.

Recent reports by watchdog groups have identified at least $2.4B in lump sum spending spread across 78 separate funds. Among the largest lump sum appropriations are to the Empire State Development Corporation, which passes lump sum state funds to state controlled non-profit organizations like the SUNY Research Foundation, Fort Schuyler Management Corporation, and Fuller Road Management Corporation. In turn, these non-profits use these funds for major state business subsidy projects like Buffalo Billion and various nanotech and computer chip projects.

The groups note that secret lump sum expenditures featured in the corruption convictions of both former Speaker Sheldon Silver and former State Senator Malcolm Smith.

The groups agree with the Comptroller that un-itemized state expenditures should be distributed by formula (like School Aid or CHIPS) or spent in a transparent fashion, subject to clear public criteria like those used by the Environmental Facilities Corporation.

The groups also stated their support for a number of DiNapoli’s other proposed fiscal reforms, including:

• Banning non-transparent, back-door spending by public authorities;
• Measures to make the state budget more transparent; and
• Creating a comprehensive, need-based, capital planning process

Comptroller DiNapoli’s “Unfinished Business” report can be found here:
https://www.osc.state.ny.us/reports/fiscal/fiscal_reform_2016.pdf