Jul 14th - 2:03 pm
Comptroller Tom DiNapoli’s office on Thursday touted an independent report of the state’s pension fund, which found his office had “strong policies” in place for ethical management of the retirement system.
However, the report also noted concerns about the level of staffing and compensation at the comptroller’s office which could have “current and future consequences” on the fund.
The report conducted by Funston Advisory Services reviewed more than 1,000 contract documents and interviewed comptroller staff and members of the office’s advisory committee. The firm also reviewed information related to new investments in the fund during the three-year review period.
“Since taking office, I have sought to establish our state’s pension fund as a leader in transparency, ethics and effectiveness. It’s gratifying to have an independent voice affirm our efforts,” DiNapoli said.
“Our staff has helped build one of the nation’s strongest pension funds, but only with competitive compensation and additional resources can we accomplish all that we need to do to manage the Fund effectively and efficiently. Our task going forward will be to expand and enhance our team and our internal expertise to better meet the challenges and risks of an increasingly volatile global market.”
The report concluded the management of the pension fund is “severely understaffed” given its size.
“In addition, independent compensation benchmarking indicates that [investment] staff compensation levels are in the bottom quartile for similar public pension funds,” the reoprt found. “There is justifiable concern that current staff will leave if compensation is not increased, and it is likely that [the Fund] will struggle to recruit needed new staff and stem turnover at current compensation levels.”
Jul 7th - 11:13 am
A report from Comptroller Tom DiNapoli’s office released Thursday found the state’s management of the Excelsior Jobs Program, which provides millions of dollars in targeted tax credits in exchange for job creation, hasn’t provided adequate oversight of the pledges made by private-sector companies.
The report comes days after the Empire State Development Corp., which oversees economic development programs in New York, quietly released a report on Friday that found a separate program, START-UP NY, has only produced 408 jobs in its two-year history.
The Excelsior audit was knocked by the Empire State Development Corp. in a statement, saying the comptroller’s office ignored “key facts” when reviewing the program.
But DiNapoli in a summary of the report urged the agency to take a more active role in oversight of the program.
“New York state gives away millions of dollars each year in tax breaks for companies that are supposed to create jobs and expand under the Excelsior program, but ESD’s oversight leaves a lot to be desired,” DiNapoli said. “ESD needs to stop lowering the bar and giving companies a pass when they fall short of promises. ESD needs to ensure these businesses are not taking advantage of state taxpayers.”
The Excelsior program was created in 2010 and provides refundable tax credits to businesses, with the promise of creating and maintaining jobs or for making capital investments.
The audit, which examined 25 companies, found that as of June 2015, received 39 tax credits of $4.8 million.
The audit found ESD had not exercised enough due diligence when approving any of the 25 selected companies when it came to participating in the Excelsior program. At the same time, the agency failed to follow its own protocol for scrutiny in its applications.
The agency also did not provide auditors with documentation verifying the 25 companies met all of the required benchmarks for being included in the program.
Verification was similarly unavailable when it came to agreed-upon job targets, with benchmarks of five of the 39 tax credits.
The comptroller’s office is recommended a range of reforms to oversight of the program by ESD including ensuring all tax credit calculations are correct before actually issuing he credits and limit modifications to annual job growth and investment requirements.
In response to the audit, ESD spokesman Jason Conwall insisted the comptroller’s report was flawed.
“Any truly objective review would show this program is cost-effective, performance-based, and incentivizes business growth by only providing tax credits to those that have achieved their job commitments and investments,” Conwall said.
“The reporting requirements to this agency, as well as to the Department of Labor, are rigorous and companies have to demonstrate to ESD that they met their job commitments before any credits are issued. To be clear: auditors did not find a single instance where incentives were improperly provided. They also apparently ignored the success of this program, which, to date has admitted 434 businesses that have committed to create more than 44,445 new jobs, retain nearly 158,000 existing jobs and invest $4.2 billion.”
Jun 29th - 11:27 am
Comptroller Tom DiNapoli announced Wednesday his office would begin an immediate review of the pension fund’s investment portfolio to determine if there are any firms with ties to the effort to boycott, divest and sanction Israel.
The move from DiNapoli comes after Gov. Andrew Cuomo announced the state would move to curtail the “BDS” movement through a boycott of companies and other entities that participate in the campaign.
“Attempts to harm Israel’s economy can put our investments there at risk,” DiNapoli said. “Israel remains an attractive place to invest and we look forward to finding new opportunities there. We’re putting companies engaged in BDS activities on notice that there will be consequences if their anti-Israel activities expose our investments to financial harm.”
The pension fund has about $532 million in Israel-related investment opportunities. DiNapoli also visited Israel in November 2015.
Companies that are determined to be involved in BDS activities will be added to a restricted list blocking investment. A firm that is being invested in by the pension fund that’s involved in the BDS movement will be placed under review and could have their relationship ended.
Jun 23rd - 3:53 pm
Comptroller Tom DiNapoli in a radio interview on Thursday said he was yet to see a contract for the independent investigator hired by Gov. Andrew Cuomo’s administration to review contracting and payments in the Buffalo Billion economic development program.
“As of yesterday, we have not,” DiNapoli said on WCNY’s The Capitol Pressroom. “Whether something is happening today, I don’t know.”
Cuomo in May announced he had hired Bart Schwartz, a former federal prosecutor, to review contracts in the economic development program, which has come under scrutiny by U.S. Attorney Preet Bharara’s office.
Schwartz’s role has not been fully defined, nor has it been disclosed how much he is being paid for his services. The Times Union reported this week Scwhartz would have subpoena power granted by Cuomo under the Moreland Act powers.
In the interview, DiNapoli pushed back against initial assertions his office was to blame this month for a delayed payment to contractors under the Buffalo Billion program which nearly once again led to a round of layoffs.
DiNapoli insisted his office was asking “basic questions” to determine where the money was going and whether proper safeguards were in place.
“When some of these payments come through, the other work we do which is payment approval or making sure the minimum requirements are in order, that’s part of our due diligence we’re going to continue to provide,” he said. “To a certain extent, I think our office was unfairly beat up last week that we were withholding the payments. Well, we have some basic questions we have to ask.”
Among those questions is whether Schwartz reviewed and approved the payment.
“Did he look at this before the payment came to us? The PACB has some as part of the approval has some added disclosure and oversight,” he said. “Is that being followed? Those are the kinds of basic questions we should be asking. And if it takes an extra day or two to do that, that’s our job.”
At the same time, DiNapoli indicated his office would continue to exercise what power it has to review the program as well as additional economic development spending. An audit on the Excelsior Jobs program is due out soon, DiNapoli said.
“No one is trying to hold up a payment or have workers laid off,” DiNapoli said. “To send something over and you have to approve it yesterday and not respond to basic questions quickly, that’s a problem for us.”
Jun 23rd - 11:48 am
An audit of homeless shelters outside of New York City found many are in poor condition, facing health and safety issues, according to a report released Thursday by Comptroller Tom DiNapoli.
The audit, conducted in conjunction with county comptrollers from Albany, Dutchess, Nassau, Onondaga, Suffolk and Ulster counties reviewed conditions at 200 emergency shelters as well as 187 hotels and motels.
Overall, auditors found 320 facilities to be in “generally adequate” condition.
However, 67 facilities that provide shelter services to the homeless were found to poor or very condition, ranging from issues such as mold, dirty restrooms and vermin. More than 60 faciltiies were found to have fire safety issues such as lacking a fire escape, inadequate fire extinguishers or missing smoke detectors.
At 37 facilities, there were personal safety issues such as restroom doors that do not lock, unsafe playgrounds and staris, while 20 locations had poor bedding and not enough toilets.
“Homelessness is a problem affecting communities in virtually every corner of the state,” DiNapoli said in a statement. “Despite our best efforts, there continue to be run-down – and sometimes even squalid – shelters that pose a real danger to the health and safety of families and individuals that have nowhere else to go. It is clear that greater action is needed to ensure that all homeless shelter facilities provide safe accommodations for some of New York’s most vulnerable residents.”
Even among the facilities deemed to be in overall good condition, there are still persistent issues that should be corrected.
The report was conducted after Gov. Andrew Cuomo in his January State of the State address called for a new homeless housing push that gave the state never oversight of the shelter system.
The Office of Temporary and Disability Services, the agency responsible for administration of the housing and service programs for the homeless, is also in charge of monitoring local oversight and inspection of shelters, but has delegated authority for smaller facilities to county social services departments.
Jun 13th - 2:51 pm
The state pension fund posted its worst rate of return since the financial crash of 2008, Comptroller Tom DiNapoli’s office on Monday announced.
The pension fund earned a 0.19 percent rate of return in the 2015-16 fiscal year, the worst performance since 2009 when the fund’s return dropped by nearly 25 percent.
The total value of the fund stands at $178.1 billion, with the value reflecting the $10.9 billion in benefits paid out during the fiscal year.
DiNapoli earlier this year indicated the pension fund’s performance amid a volatile financial market would be less than robust.
The state’s pension fund at the time was valued at around $184.5 billion, one of the largest retirement funds in the country.
The virtually flat rate of return is potentially problematic for local governments whose contribution rates have skyrocketed over the last decade.
Last year, DiNapoli announced the state would once again reduce contributions from 18.2 percent of payroll to 15.5 percent. The average rate of contribution for the police and fire retirement system declined by 2 percent — from 24.7 percent to 24.3 percent.
In the previous fiscal year, the rate of return stood at 7.16 percent, while in 2014-15 it posted a return of 13 percent as the economy was recovery.
Still, DiNapoli insisted that despite the challenges presented by the market, the fund was still able to remain in the positive area.
“Despite weak equity markets, the Fund’s diversified portfolio and our investment team delivered a positive return,” DiNapoli said. “We continue to have confidence in our asset allocation for the long term. Our investment team is focused on ensuring we remain one of the best funded and top performing plans in the country.”
Jun 9th - 10:49 am
Deaths related to heroin and prescription opioid overdoses hit a record high in New York in 2014, a report released on Thursday by Comptroller Tom DiNapoli found.
The report fund overdose deaths in which heroin was considered a factor hit 825 in 2014, the most recent year data was available from the Centers for Disease Control and Prevention. The record is an increase from 159 deaths in 2013 and is an increase of 25 times from the number New York recorded in a decade ago.
“Heroin and prescription opioid addiction often come with disastrous consequences, tearing apart families and causing financial ruin,” DiNapoli said in a statement. “While New York state and some local governments have taken important steps to reduce heroin and opioid abuse, the costs associated with this epidemic are growing and the health, safety and prosperity of our communities are at risk.”
The news comes as state lawmakers are weighing action on a variety of bills aimed at stemming the heroin addiction rates in New York, along with plans to provide better access to treatment, prevention programs and strengthening law enforcement for dealers.
The budget approved in April included $25 million in funding for local governments to develop or expand current treatment and prevention programs as well as housing services.
May 31st - 11:46 am
The Priceline Group. Inc. has agreed to include gender and racial diversity when seeking new members for its board following a shareholder proposal from the state’s pension fund, Comptroller Tom DiNapoli on Tuesday announced.
With the agreement from Priceline, the shareholder request from New York has been withdrawn, DiNapoli said.
“We encourage our portfolio companies to commit to a diversity of experience and thought on their boards because it is an asset to business,” DiNapoli said. “Fresh ideas can revive stagnant and homogenized boards, and companies with directors from diverse backgrounds are better positioned to generate long-term company growth. Priceline should be commended for pursuing board diversity.”
It’s another example of DiNapoli using the leverage of the state’s pension fund to encourage changes to how a company operates, either through transparency in political giving or through who the company incldues in its leadership.
Priceline in January added its second female director to an 11-member board.
Under DiNapoli, the pension fund is seeking similar diversity commitments from firms like FleetCor Technologies and LinkedIn. All told, similar proposals have come from 17 portfolio corporations since 2012.
May 23rd - 3:29 pm
New York’s tax revenue in April declined during the first month of the new fiscal year compared to the same time last year, according to a cash report from Comptroller Tom DiNapoli’s office.
The state collected $8.2 billion in taxes last month, a reduction of $420.4 million, or 4.9 percent, to April 2015.
It’s a potential red flag for the state’s economy and the revenue picture for the state. Nevertheless, the revenue was more or less what conservative estimates given the expected slackening of the economy.
“April tax receipts were in line with more conservative projections compared to just a few months ago as the economy has shown signs of slowing in the first quarter of the year,” DiNapoli said. “New developments in the coming months and their impact on revenues must be monitored closely as the new fiscal year progresses.”
The decline year over year is due to lower estimated personal income tax payments that resulted from a weakened financial market.
New York meanwhile spent $10.5 billion last month, $2.8 billion more than last year during the same period.
May 23rd - 1:39 pm
Comptroller Tom DiNapoli’s office is teaming up with the Church of England to pressure the company on the issue of climate change.
DiNapoli in a statement on Monday signaled he would use the state pension fund’s investment in the company to leverage a response out of its board of directors on how ExxonMobil will adjust to internationally driven policy of limiting the effects of climate change through a reduction of carbon output.
“Combating climate change presents risks and opportunities that ExxonMobil needs to address,” said DiNapoli, who is trustee of the New York State Common Retirement Fund.
“We need to know if ExxonMobil is taking into account the growth of lower carbon economies and taking steps to protect the long-term value of our investments. Earlier this year, the company tried unsuccessfully to get the Securities and Exchange Commission to keep investors from voting on these important questions at the annual meeting. ExxonMobil’s peers are stepping up to address climate risk, it’s time they did so as well.”
The effort is being joined by the Church of England, which has also invested in the company and has taken on a similar activist shareholder role.
“I am delighted investors will have the chance to vote on this motion at this week’s annual meeting, in spite of ExxonMobil’s best efforts to deny them that opportunity,” Edward Mason, the Head of Responsible Investment for the Church of England’s investment fund said. “With peers such as BP and Shell agreeing to report on climate risk, the company is in danger of being increasingly out-of-step with the mainstream on this issue.”
The announcement comes as Attorney General Eric Schneiderman’s office is reviewing Exxon’s impact on the environment and climate change. The AG’s office last week blasted a letter sent by House Republicans seeking more information from Schneiderman’s office as well as 16 additional attorneys general who are gathering information in the case.