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State Comptroller faults Broome County IDA for conflict of interest
The Innovation Trail is taking a closer look at New York State's industrial development agencies, or IDAs. Get up to speed on what IDAs do - and what they don't do - by reading this primer, and subscribing to the IDA RSS feed.
In an audit released Wednesday, state Comptroller Thomas DiNapoli cited Broome County's Industrial Development Agency (BCIDA) for a conflict-of-interest.
The problem: George Akel, the IDA's chairman of the board, is also part owner of a company involved in one of the agency's big ticket projects.
The comptroller says that's a no-no.
From the audit:
The Chairman is an officer and 16 2/3 percent member of the Washington Development LLC. On August 23, 2010, the BCIDA entered into a PILOT agreement with the City of Binghamton and Washington Development LLC for the purpose of constructing a student apartment complex. The Chairman, as an officer of the BCIDA and member of the LLC, has an interest in the contract. As a member of the BCIDA Board at the time the PILOT agreement was entered, the Chairman had one or more of the powers and duties that give rise to a prohibited interest in a contract.
The land was owned by Washington Development Associates. The IDA took over the parcel so that the owners of the student housing project wouldn't have to pay property taxes.
And while Akel recused himself when the project was being discussed at board meetings, a 'prohibited interest' means that wasn't enough.
According to the comptroller, either the company should not have done business with the IDA or Akel should not have been on the board.
Akel and the IDA's executive director, Richard D'Attilio, were unavailable for comment. D'Attilio did speak with the Press-Sun Bulletin:
"We thought we were acting in good faith and following the law," said Richard D'Attilio, the IDA's executive director. "It was an honest mistake that we'll just put behind us."