Skip to Content

Login   Subscribe   Site Index   Contact Us   Google Translate™

NYS Comptroller


Taxpayers' Guide to State and Local Audits

Audits of Local Governments and School Districts

Town of Newstead – Joint Highway Facility Project (2012M-260)

Released: March 15, 2013 -- [read complete report - pdf]

Purpose of Audit

The purpose of our audit was to examine the Town Board’s management of the Joint Highway Facility Project for the period January 1, 2008, to August 31, 2012.


The Town of Newstead is located in Erie County with a population of approximately 11,400 residents. The Town is governed by the Town Board, which comprises five elected members: the Town Supervisor and four Council Members. In February 2010, the Board authorized the issuance of serial bonds for the Joint Highway Facility Project at a maximum cost not to exceed $4.25 million.

Key Findings

  • An inter-municipal agreement was entered into by the Town and the Village to address their respective involvement with not only the construction phase of a joint highway facility (Project) but the facility’s future operation and maintenance. While the inter-municipal agreement sets forth the approach and the responsibilities assigned to the Town and Village, many of its terms were not complied with.
  • Town officials did not fully inform taxpayers of the entire cost or fully disclose the Board’s intentions with respect to financing the Project during the early planning phase. As a result of Town officials’ poor planning and management, the Project’s costs have grown to more than $4.7 million.
  • Change orders totaled more than $800,000, $438,000 of which were unrelated to the original project scope and were not competitively bid, as required.

Key Recommendations

  • Consult with legal counsel and review the provisions in the inter-municipal agreement that address the operation and maintenance of this joint highway facility to ensure the terms still reflect the two Boards’ expectations.
  • Inform the public of all costs reasonably expected to complete a capital project when they are known. Ensure that capital project requirements and costs are properly planned before awarding contracts, to minimize the need for change orders.
  • Properly approve all change orders and competitively bid any change orders in excess of the competitive bidding threshold.

Local Government and School Accountability Contact Information:

Phone: (518) 474-4037; Email:
Address: Office of the State Comptroller, Division of Local Government and School Accountability
110 State Street, 12th Floor; Albany, NY 12236