Hevesi Rescinds Approval Of Canal Corp. Contract With Hutchens Because Agency Provided False & Misleading Information
State Comptroller Alan G. Hevesi said today that he has rescinded the May, 2002 approval of a contract between the state Canal Corporation and Buffalo businessman Richard Hutchens for development rights along the Erie Canal because of false and misleading statements made by the Canal Corporation regarding the agreement.
Under the terms of the contract, it is not effective without the approval of the Comptroller, so rescinding the approval renders the contract null and void.
“The Canal Corporation and its parent, the Thruway Authority, have repeatedly asserted that the approval of the Hutchens contract 18 months ago by the Comptroller’s Office is an indication that the contract met our review standards,” Hevesi said. “But it is now clear that the Canal Corporation did not provide honest and complete answers to the Comptroller’s Office during the contract review process, so I am rescinding this Office’s approval which thereby voids the Hutchens contract.”
Hevesi formally rescinded the contract approval, which resulted in the voiding of the contract, in letters sent Friday, October 17 to Thruway Authority Chairman Michael Fleischer and each member of the Thruway Authority Board of Directors, a copy of which is attached. In the letters, Hevesi detailed findings based on an in-depth analysis of the contract review process and on information disclosed at a recent hearing of the Assembly Committee on Corporations, Commissions and Authorities that focused on the Hutchens contract.
Among these findings are the following:
Hutchens was not the only firm interested in and prepared to pursue real estate development along the canal, contrary to information provided by Canal Corporation officials during the contract review process. At least seven firms that contacted Canal Corporation in response to a 1996 solicitation were interested in real estate development, but were either excluded for specious reasons or ignored. One of the firms was so interested in canal-side development that it went on to complete three residential developments without Canal Corporation assistance.
Canal Corporation officials falsely told the Comptroller’s Office that they followed up with all 33 firms that responded to the 1996 letter. There is only evidence of Canal Corp. sending letters to 14 of the 33. Comptroller’s Office staff were able to locate 18 of the 33. Only two of the 18 recalled any follow-up conversations.
Hutchens had inside information that other firms did not have access to, and it appears his proposal was the model for the Canal Corporation’s 1999 solicitation. A proposal made by Hutchens as early as 1996, and refined through interaction with the Canal Corporation during the following years, became the model described in the official solicitation for residential developments along the canal advertised in the Contract Reporter in 1999.
Before the Canal Corporation’s formal solicitation for canal-front development concepts, attempts were made to influence at least one Thruway Authority and Canal Corporation Board Member to support the Hutchens proposal. A handwritten note and other communications from 1998 discuss efforts by Hutchens to discuss his proposal with Board Member Nancy Carey.
In his letter, the Comptroller also asked the Thruway Authority to return the $30,000 payment to Hutchens and to inform all entities which may be effected by the contract that has been voided.
“Development along the Erie Canal will be an important part of upstate economic development efforts in the coming years,” Hevesi said. “But there is no excuse for not giving every potential developer an equal opportunity to compete for the right to build. When the State offers a valuable opportunity, it must use a fair and open competitive process to award it. That is not only in the interest of fairness for the vendors, but also to ensure that the taxpayers receive the best possible deal.” ###
There are many states that have super roads and bridges that are in good shape and they are not toll roads. Stop some of the pork bills and use the money to maintain the roads and bridges instead.
Tedisco is wrong to call for elimination of Thruway tolls BENJAMIN TURON Ballston Spa
Re the Nov. 24 article “Spitzer rapped about toll hikes”: Assemblyman James Tedisco’s call for the elimination of tolls on the New York State Thruway is illconceived. If not tolls, then what will pay for the aging superhighway? While free for drivers, in the end we would all pay for the maintenance and rebuilding of the Thruway indirectly through higher state taxes. And with the Federal Highway Trust Fund projected to go into deficit in 2009, less federal funding is expected unless the federal gas tax is substantially raised. That the Thruway is financially self-sufficient should be praised. Ironically, Tedisco is at odds with current conservative thinking, as espoused by the likes of George Will and the Wall Street Journal, that there should be more toll roads (private, of course) opposed to less! The leasing of the Chicago Skyway and Indiana Toll Road are often cited as successful examples. Proponents claim private highways will provide the capital for expansion and save money through better management. Personally I welcome the audit by State Comptroller Thomas DiNapoli on the proposed toll increases; check and balances is what accountability in government is all about. However, from the perspective of the many trips I have made via the Thruway, I think it is a very well-run operation. I am also glad that the tolls, or “user fees,” are all invested back into the transport system and not used to enrich private shareholders. With major projects such as the Tappan Zee Bridge, Buffalo Peace Bridge and Southern Tier Expressway (I-81, I-86) on the table, perhaps a rise in tolls is justified if it will finish these vital projects. Tedisco has apparently become lost in the capital’s all-encompassing miasma that has poisoned state politics and brought progress to a standstill. My advice is to turn on the fog lights and get back on the high road; voters are not served by partisan detours.
All raising the Thruway tolls is going to do is force people who currently drive on the Thruway to seek an alternate route to avoid paying the higher tolls which will just make the current situation of lower funds worse. The problem really started when the Thruway had to start funding the bottomless money pit called the NYS Canal System. Let some of the people who use the canal system pay for some of the upkeep and salaries of the people who operate the system instead of just dump all the costs back on the Thruway users.
Assembly Minority Leader James Tedisco, upset that Gov. Eliot Spitzer wants to hold the line on New York City subway fares but won’t oppose a Thruway toll hike, thinks tolls should be removed from the 641-mile highway system. A wonderful idea if the state could afford it, because where else would the money to keep up the road come from? Like any Republican worth his salt, Tedisco could be counted on to oppose the tax hikes needed to raise this money. But with New York already facing a $4 billion-plus deficit next year, there’s no way around the dilemma without toll revenues or tax hikes. Still, the Thruway can — and should — do something to cut its considerable cost ($40 million a year) for toll collectors, obviating the need for regular toll hikes, including the relatively small one due to take effect next year and the larger ones Executive Director Michael Fleischer has projected for the future. The way to do that is to increase the price differential in tolls between E-Z Pass and cash customers. In short, motorists need a greater incentive to switch to the electronic toll-collecting system. It takes so little for someone to open an account and affix a transponder to the windshield, and despite the fact that doing so makes it possible to sail through congested toll plazas, not to mention save 10 percent on their tolls, only 60 percent or so of the Thruway’s customers have bothered 13 years after the introduction of E-Z Pass. Meanwhile, the number of toll collectors has shrunk, from 782 to 506, but that’s a reduction of only 35 percent. If most toll collectors’ jobs could be eliminated, toll hikes might be too. Unfortunately, when Fleischer announced the new toll hikes a couple months ago, he indicated that the EZ Pass discount in some areas of the state was being diminished. That’s the wrong way to go if the authority is to cut costs and keep future toll hikes to a minimum.
Why not jut put in more EZ Pass lanes, some high speed fly thru lanes, and have only a couple of lanes that need collectors and we could save a lot of money. The union doesn't want to allow anything in NYS to be done like this as it would result in job cuts and lose of union members. Other states have had these systems for years and some states have tolls but nowhere near as high as NYS.
I agree, Shadow. More technology and less people sitting on their duffs. Every exit should have a high-speed lane (and I even say that the 20 m.p.h. lane is a little slow, let's have it full speed). The savings in pay and/or benefits should be able to cover it.
CAPITOL Legislature voices opposition to toll hike BY BOB CONNER Gazette Reporter
Opposition to Thruway toll increases mounted Tuesday in the state Legislature. Assembly Speaker Sheldon Silver, DManhattan, released a statement saying he is opposed to planned toll increases “until an audit by State Comptroller Thomas Di-Napoli, currently under way, can determine if the increased revenue is actually necessary.” The proposed increases, the speaker said, “would have a devastating effect” on commuters and businesses. John McArdle, chief spokesman for Senate Majority Leader Joseph Bruno, R-Brunswick, said Senate Republicans oppose the toll increases, and favor splitting the Canal Corp. away from the Thruway Corp., which it has been under since 1992. Most of the Canal Corp.’s annual budget is paid for by Thruway tolls. The Associated Press on Tuesday quoted Michael Fleischer, the Thruway Authority’s executive director, as saying removal of the Canal Corp. from the Thruway Authority’s budget probably would mean the toll hikes wouldn’t be needed. “If [the Canal Corp.] was gone, the authority would probably still have to reduce E-ZPass discounts but would likely not have to do the general toll increases in 2009 and 2010,” Fleischer was quoted as saying. The state Legislature folded the Canal Corporation — which runs state’s canal system — into the Thruway Authority in 1992. Today, it costs about $80 million a year to run the canal system, which takes in only about $2.5 million in revenue, Fleischer said. Silver’s statement was issued shortly after a public forum by Assembly Republicans, where there was widespread support for splitting the Canal Corp. from the Thruway Authority. Assemblyman George Amedore, R-Rotterdam, who chaired the meeting, said later that money to fund the Canal Corp. could come from freezing, instead of increasing, a municipal aid program to New York City. The economy there, he said, has been booming, unlike in the upstate areas where the Thruway goes from Albany to Buffalo. Assembly Minority Leader James Tedisco, R-Schenectady, who also attended the meeting, issued a statement supporting a long-term plan “to eliminate tolls altogether” on the road. Business leaders also opposed the toll increases and supported splitting off the Canal Corp. However, Steve Stallmer, executive director of the state chapter of the Associated General Contractors of America, said his organization does not want tolls abolished, because they provide a guaranteed revenue stream. Vincent Gramuglia, who owns five truck stops near the Thruway, does want the tolls gone. Tolls and taxes, he said, are killing his business. He said there are at least 50 bridges that exist only to ferry drivers to toll booths, yet have to be maintained out of those same tolls. Assemblyman Jack McEneny, D-Albany, said he, too, is opposed to toll increases, but questioned where the revenue would come from to support the Canal Corp. if it were split away. Dan Weiller, Silver’s chief spokesman, declined to say whether the Canal Corp. should be split off, but said that issue would be discussed in hearings the Assembly majority plans to hold later this month. Comptroller DiNapoli’s spokeswoman, Jennifer Freeman, said the Thruway audit began Nov. 16, and is being expedited, meaning it should be finished in several weeks, rather than the normal process that takes several months. On Jan. 6, the Thruway Authority is scheduled to raise tolls by 10 percent, which is the last stage of toll increases approved by its board in 2005. The authority also has announced tentative plans for further increases: a reduction in the E-Z Pass discount next year, and 5 percent toll increases in both 2009 and 2010. In a speech at the Rockefeller Institute last week, DiNapoli said: “Right now, authorities are spending state dollars — often on projects with no connection to the authorities’ core missions and there’s little or no review of that spending. Public money should be open to public scrutiny.” Asked if that meant that the audit would recommend splitting the Canal Corp. from the Thruway, Freeman said it was under consideration. Last year, former Gov. George Pataki proposed such a split, which was supported by the Thruway Authority board and Canal Corp. Director Carmella Mantello. His bill, however, did not pass either house of the Legislature. On Tuesday, Mantello said she and the board have not changed their positions, but, “We’re not proposing the separation right now. … That’s for the Legislature to decide.” Mantello said the Canal Corp.’s annual budget is between $70 million and $80 million, with most of that coming from the Thruway tolls. It also gets several million dollars in federal money, and state grants have allowed it to waive boat tolls for the past two seasons. At the Assembly Republican forum, Tedisco linked the proposed highway toll increases to proposed increases in state university tuition as burdens on the hard-pressed upstate economy. He said Gov. Eliot Spitzer, who recently vowed to stop fare increases on New York City public transit and has said he opposes tax increases, also should oppose the toll hikes. “This is an $80 million tax as far as I’m concerned,” Tedisco said. Jim Lomanto, of the Brown Coach company in Amsterdam, said it is currently paying about $50,000 per year in tolls. “We cannot continue to absorb the high cost of doing business in New York,” he said. Spitzer’s office has said the governor supports the DiNapoli audit, but opposes splitting the Canal Corp. from the Thruway Authority, because it would increase next year’s projected budget gap. He also opposes for budgetary reasons abolishing tolls on the Thruway. McArdle said Bruno is open to the idea of abolishing the tolls, as the state had originally planned for when the construction bonds were paid off in the mid 1990s. While Tedisco and Amedore support abolition, two other Republican assemblymen at the hearing, Peter Lopez of Schoharie and Marc Butler of Newport, declined to take a position on whether the tolls should be abolished. McEneny said he is open to phasing out the tolls.
Spitzer opposes toll hike for now Proposed increase for Thruway faces further opposition BY BOB CONNER Gazette Reporter
The administration of Gov. Eliot Spitzer came out against proposed Thruway toll increases Wednesday, at least until it gets more information about them. “We are unable to endorse the proposed toll increases for the Thruway Authority,” wrote Timothy Gilchrist, Spitzer’s deputy secretary for economic development and infrastructure, in a letter to Michael Fleischer, executive director of the Thruway Authority. Gilchrist objected both to the Thruway’s previously approved 10 percent toll hike scheduled to take effect Jan. 6 and further increases tentatively planned for the next three years. There has been mounting opposition to the toll increases from the Legislature, including the leadership of both houses. Assembly Republicans are holding a series of public meetings around the state to provide a forum for public opposition to the toll hikes. Gilchrist wrote: “Your proposal discusses the need to maintain the Thruway credit rating and yet increases the coverage ratio [revenue to debt service] to higher levels than called for in your internal fiscal management guidelines and your bond covenants. “Why is the Thruway Authority seeking the higher coverage ratio? ... What is the certainty of a lower credit rating if higher coverage levels are not maintained?” Gilchrist also said, “The Thruway is proposing a much larger capital program than it has executed in previous years,” and he raised questions about that. Thruway Authority spokeswoman Betsy Graham responded with a statement saying: “The Authority’s staff will provide answers to and continue to work with the governor’s staff to allow for further analysis of the Authority’s proposal. The Authority is confident that its staff will be able to develop a plan that protects the safety of its roads and bridges by preserving the highway and bridge improvement plan and minimizes the impact on commuters, while still ensuring the soundness of the Authority’s financial plan. The Authority board has a fi duciary responsibility to safeguard the Authority’s finances, to maintain the integrity of the Thruway System and preserve a good credit rating.” The Thruway board has the legal authority to raise tolls on its own. Approval by the Legislature or governor is not required. Gilchrist recognized that in his letter and said the governor’s office will be “in a better position to make a judgment position on the proposed increase” when it receives the requested information and reviews an audit of the Thruway being done by the state comptroller’s office. The Thruway board is dominated by appointees of former Gov. George Pataki, most of whom were put on it late in the Republican governor’s last term. Democrats, including Assembly Speaker Sheldon Silver, D-Manhattan, have criticized the makeup of the board and suggested that it is time for new members. Spitzer had been accused of “geographic discrimination” by Assembly Minority Leader James Tedisco, R-Schenectady, for opposing transit fare increases in New York City but not the Thruway toll hikes. Republicans have called the planned toll increases an additional burden on the struggling upstate economy. They also suggested that one way to buttress the Thruway Authority’s finances would be to take away its responsibility for the state Canal Corp. Thruway tolls pay for most of the Canal Corp.’s $80 million annual budget. Last week, the governor’s offi ce opposed removing the Canal Corp. from the Thruway Authority, saying that would add to next year’s projected $4.3 billion state budget gap. Fred Miller, executive director of the Mohawk Valley Heritage Corridor Commission, said he is skeptical about splitting off the Canal Corp. without an assured source of funding for it. Last year, Pataki proposed a split, and his position was supported by the Thruway board and Carmella Mantello, executive director of the Canal Corp. She said this week that there is widespread support for the canal system from legislators in both parties and she would expect them to provide adequate funding if the split did happen. Prior to 1992, when it came under the Thruway Authority, the Canal Corp. was part of the state Department of Transportation.
Think about this, too. This is not just a tax on those of us who drive it every day. Remember, the State offices for the Assembly, Senate and the Governor are all in Albany. And don't forget, too, that the people who occupy these offices do not just stay IN their office in Albany all year round. Now, I understand that the Thruway does not go everyplace in the state, but what is the quickest way for the majority of our representatives to get to their jobs that they have been elected to? The Thruway. And if they are charged a toll on their way, as they ride on the Thruway, THEY DO NOT PAY THAT CHARGE. That's right, they don't pay it. Why not? Because you, the taxpayer do. Remember, they get a paycheck. That paycheck is made out of money that was already pulled out of your pocket. So, by reaching into their pocket to pay the toll, whether it be $0.25 ($0.23 for someone with E-Z Pass (Schenectady to Albany, 25 - 24)) or $11.35 ($10.22 for someone with E-Z Pass (Exit 21 (I-190) - Niagra Falls to Exit 24 - Albany)) or $4.35 ($3.92 for E-Z Pass) from exit 15 down on the southern side, they're reaching in your pocket for that money.
Silver’s statement was issued shortly after a public forum by Assembly Republicans, where there was widespread support for splitting the Canal Corp. from the Thruway Authority.
Oh look.....he spoke.......
...you are a product of your environment, your environment is a product of your priorities, your priorities are a product of you......
The replacement of morality and conscience with law produces a deadly paradox.
STOP BEING GOOD DEMOCRATS---STOP BEING GOOD REPUBLICANS--START BEING GOOD AMERICANS
GOOD POINT BK! So not only will we be paying for our tolls, we are also paying for every public employee AND our beloved politicians as well!!! Nice, huh?
When the INSANE are running the ASYLUM In individuals, insanity is rare; but in groups, parties, nations and epochs, it is the rule. -- Friedrich Nietzsche
“How fortunate for those in power that people never think.” Adolph Hitler
It baffles me how stupid the spin doctors think we are. Newly-elected Assemblyman George Amedore is going to be using more of our money to hold public hearings to get feedback from the public — particularly the business community — to find out if the proposed increase in tolls on the Thruway is going to effect business [Dec. 5 Gazette]. Who is he kidding? Any increase in any expenditure for anyone or any business is going to cause pain to any who are affected by the increased cost. This isn’t rocket science. However, Assembly Minority Leader James Tedisco has provided the newlyelected assemblyman with the opportunity to show the voting public that he really cares about us at our expense. God love our country. Don’t you think it would be a lot easier for Tedisco to call Senate Majority Leader Joseph Bruno and set a meeting with Thruway Chairman John J. Buono, the former Rensselaer County executive and appointee of various high-profile positions during the Pataki years, that these increases are going to cause pain to newly-elected Amedore’s constituents, who commute in from Fulton/Montgomery/Schenectady/ Scoharie counties? Mark my word, the fare hikes will go on hold and the agency will find the will to cut the fat somewhere else — like the rank-and-file folks from the Thruway Authority who actually do something. Chalk up another example of governmental waste! KENNETH R. GARCIA Gansevoort
474-4015 Fax
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