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August 11, 2010


DiNapoli Shines a Light on Public Authorities

New York’s Authorities Spend Billions of Dollars with Little Scrutiny



Despite employing 159,000 people and spending $44 billion annually, New York’s 1,100 state and local public authorities remain largely unknown and unrecognized entities, according to a report released by State Comptroller Thomas P. DiNapoli.  Recent legislative changes have begun to improve reporting by and oversight of these entities.  

“There are more than a thousand public authorities in the state, but most New Yorkers don’t know what they do or how they do it,” said DiNapoli, “There’s very little accountability to the voters. The Public Authorities Reform Act of 2009 made strides towards improving accountability of public authorities.  But there’s too much taxpayer money involved; public authorities need more oversight and more transparency.

Total expenditures by authorities for the latest reported fiscal year totaled $44 billion – equal to about 84 percent of the state’s General Fund spending.  Total public authority revenue was $40.2 billion for the latest reported fiscal year.  Because authorities operate outside of the state budget and are not part of the state’s accounting system, financial information about public authorities is self-reported.

Since the creation of the Port Authority of New York and New Jersey in 1921, New York has added 323 state authorities, 771 local authorities and eight interstate or international authorities.   Although authorities have advanced critical infrastructure projects and provided valuable services, they have increasingly been used for projects beyond their original purpose, and now function as a virtually independent arm of government.

Authorities have been increasingly used to incur debt on behalf of the state without voter approval, commonly referred to as "backdoor borrowing."  State and local public authority debt outstanding exceeded $214 billion for the latest reported fiscal year, of which over $53 billion is state-funded debt.  As of March 2009, over 94 percent of all state-funded debt outstanding was issued by public authorities without voter approval, reflecting an average increase of nearly 9 percent per year since 1985.

Enactment of the Public Authorities Accountability Act of 2005 and the Public Authorities Reform Act of 2009 created new reporting, disclosure and accountability requirements.   However, public authorities continue to operate with a tremendous amount of autonomy, which is why DiNapoli continues to monitor and report on their financial activities.  This is consistent with Open Book NY and with other efforts by DiNapoli to improve public access to state and local information.

For a copy of the report click here.
Additional information on public authorities can be found here: http://osc.state.ny.us/pubauth/index.htm.

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