NYS Comptroller raises alarm about mounting public authority debt

Posted at: 03/06/2013 6:01 PM | Updated at: 03/06/2013 6:27 PM
By: Beth Wurtmann

ALBANY - When it comes to racking up debt, the State Comptroller said public authorities have had too smooth of a ride.

In a new report, Thomas DiNapoli found the State's more than 1100 authorities have accrued nearly a quarter of a trillion dollars; most of it without New Yorkers' stamp of approval.

"Right now we have 94-percent of our state-funded debt that is held by the public authorities and has never been approved by the voters," said iRobert Ward, Deputy Comptroller.

Ward said 30-billion of the debt in just the last couple of years was taken on for good reasons, like building bridges and other long term capital improvements.

But the Comptroller's Office said there's not enough oversight of the spending, including on salaries.

The report found that 18,000 employees or 11.6-percent of the workforce, earn over $100,000-a-year.

Only 8.3-percent of state employees make as much.

"We believe in many cases there's no clear need for those higher salaries in order to attract good people or to make sure the authority is operating effectively," Ward added.

DiNapoli's report said another big reason for rising debt: backdoor borrowing, where money raised by authorities is grabbed by the state to plug budget gaps.

"The state uses the authorities as cash cows both by tapping their reserves and using them as vehicles for borrowing without voter approval and in that way authorities are becoming more and more quasi agencies in a way that was never intended," said EJ McMahon, Director of the Empire Center for New York State Policy.

DiNapoli wants a constitutional amendment to require voter approval for major borrowing, to get public authority debt under control.

Otherwise, he says New Yorkers will be saddled with paying off the debt for too many years to come.

Source: http://wnyt.com/article/stories/s2954313.shtml?cat=300

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