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April 29, 2010



DiNapoli Audit Identifies
Revenue Opportunities For Mount Vernon

Due to an inefficient system to collect money owed to it, the City of Mount Vernon missed out on approximately $550,000 in revenue from unpaid rental, utility and PILOT (payments in lieu of taxes) payments, and parking fines, according to an audit released by State Comptroller Thomas P. DiNapoli. The audit, requested by city Mayor Clinton I. Young, Jr., covered the period January 2008 to February 2009.

“In good times or bad, local governments must make sure they collect the money owed to them,” DiNapoli said. “But now, when every dime counts, it becomes even more imperative that local governments collect unpaid fines, fees and taxes. Mayor Young requested this audit, and he’s made a commitment to implement our recommendations.”

“From the early days of my administration I have looked at ways to increase revenues and I thank State Comptroller DiNapoli and his team for responding to my request for this audit and assisting us,” said Mayor Clinton I. Young, Jr. “I suspected that the city was in dire need of a better system of fiscal control when I took office in 2008. The audit results confirm an earlier report from our Inspector General and the need for the best internal controls in our city. We look forward to the cooperation of the State Comptroller’s office, and the Mount Vernon City Council and Comptroller’s office to help us to implement the recommendations contained within this audit.”

During the audit period, the city was owed as much as $468,079 in unpaid rental, utility and PILOT payments, and could have collected $87,800 more in parking fines if collection practices were improved. The main reason for this lost revenue was the absence of a system to monitor and enforce payments owed to the city.

DiNapoli’s auditors found that:

  • The city did not have written procedures to ensure that lease agreements were monitored and enforced. Moreover, not all tenants had formal leases. As a result, the city was owed as much as $214,950 in unpaid rents and $58,427 in associated unpaid electric and gas usage as of December 2008;
  • Due to a lack of coordination and communication between the city and Mount Vernon Industrial Development Agency, (MVIDA), the city failed to receive at least $81,016 in tax revenue because an expired PILOT property did not revert to the tax roll in a timely manner, and the city did not receive $60,000 for relocating sewer lines for a project owner. Additionally, as a result of the city’s lack of billing, reconciliation, and communication, the city did not receive $53,686 in PILOTs due as of December 31, 2008; and
  • Because the city collected only 82 percent of revenue from parking violation tickets issued from April 2008 to June 2008. If the city had achieved the industry-established benchmark of 85 percent, it would have collected $87,800 more in revenue.

DiNapoli recommended that city officials:

  • Assign an employee to monitor lease agreements and the actions the city will take upon non-compliance with leases and be sure rental payments are timely;
  • Implement written procedures to outline the process to address late or non-payment of the rents and the reimbursement process for gas and electric charges, and pursue collection of all amounts owed from lessees;
  • Improve communications with MVIDA to ensure that expired PILOTs return to the tax roll in a timely manner;
  • Determine who is responsible for preparing and mailing PILOT statements to the project owners;
  • Prepare and provide a schedule of amounts due to the accounting staff responsible for posting the receipts;
  • Consider enhanced measures that may increase the collection of parking fines and penalties. These measures could include, but are not limited to, using license plate readers, instituting civil action or amnesty programs, using collection services, increasing penalty amounts, and enhancing efforts to identify out of state registrations; and
  • Establish a standard benchmark collection rate with which to periodically assess the performance of the city’s parking ticket collection system.

City officials generally agreed with DiNapoli’s findings and have indicated they would take corrective action.

Click here for a copy of the audit report.

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