Hochul weighs bill to restore comptroller oversight of contracts

ALBANY – A measure before Gov. Kathy Hochul would restore the comptroller’s independent review of state contracts before they are signed and end a practice under former Gov. Andrew M. Cuomo.

Hochul hasn’t yet said if she will sign the bill approved by the State Legislature in June.

Starting in 2011, Cuomo had initiated several measures tied to the adoption of state budgets that took away "pre-audit" authority from the comptroller’s office. Cuomo argued it was necessary to speed purchasing of essential items and services and to cut costs created by the delay.

State Comptroller Thomas DiNapoli has sought to regain the power to analyze some of the state’s biggest contracts before the executive branch approves them. These “pre-audits” had aimed to uncover conflicts of interest, waste or fraud before a big contract is finalized under a power that had been in place for over a century, according to the comptroller’s office.

Even the legislative sponsors of the bill acknowledge that “pre-audits” of state contracts is an arcane issue for most New Yorkers. But they say the issue is a critical safeguard for spending tax dollars as well as a test of Hochul’s resolve to chart a new course for her administration distinct from the Cuomo administration.

The bill would restore the authority of the comptroller to review proposed contracts involving the Office of General Services, the State University of New York, the City University of New York, and the SUNY and CUNY construction funds. These areas alone can consume hundreds of millions or billions of spending a year.

Even if the bill is made law, governors can suspend the review in a state of emergency, which was done during the COVID-19 pandemic. Suspending laws or practices in an emergency, however, can be rescinded by the Legislature.

Supporters of the bill say the need for it was made clear by the scandals in Cuomo’s Buffalo Billion project. Some developers seeking state contracts to redevelop Buffalo were convicted of bribery, fraud and conspiracy in a 2018 federal bid-rigging case.

In 2019, under public pressure from DiNapoli, legislators and good-government groups, Cuomo agreed to a memorandum of understanding to restore some of the comptroller’s authority with several provisions for a speedy review. 

“This memorandum is not sufficient," the bill states. “Legislative action is needed to properly restore the comptroller's oversight authority and restore public confidence in the state's procurement process."

A spokesman for Cuomo declined to comment. Cuomo had said the comptroller’s review wouldn’t have stopped any wrongdoing in the Buffalo Billion case because the problem was a crime, not a flaw in contracts.

Discussions between Hochul and the legislative sponsors of the bill haven’t resumed since early October, because the governor and the legislators were focused on the election, said one of the bill’s sponsors, Sen. Elijah Reichlin-Melnick (D-Nanuet).

“No executive likes to relinquish power,” Reichlin-Melnick told Newsday. “But I take the governor at her word, that the governor is trying to make a clean break from the prior administration and take a new course … of transparency and more open government.”

The other co-sponsor of the bill, Assemb. Kenneth Zebrowski (D-Clarkstown), also sees the potential import of the moment.

“Institutionally, independent of who is the executive mansion, this is generally something a governor would look at skeptically,” said Zebrowski, chairman of the Assembly Operations Committee. “But I do think there’s a desire from this governor to turn the page on a new chapter in Albany and this would be a great way to do that.”

Hochul said last week the bill is under review.

“We are always looking to strive to improve accountability and transparency in state government,” Hochul told reporters on Long Island. “We can always do more … it's important that people know that we take taxpayer dollars very seriously, that they are invested and allocated based on strong principles and not access to individuals as has happened in the past. So no, it's an opportunity. It's an opportunity to show our priorities and how I'm going to lead over the next four years.”

Nelson Sheingold, counsel to the comptroller, said the bill would have impact beyond individual contracts.

“To see the importance of this, just open a newspaper over the last couple of years,” Sheingold said. “I think restoring the public’s faith in government and in government procurement is imperative. It not only protects the process, it protects the integrity of the process.”

He disputes Cuomo’s argument that the reviews slowed the awarding of contracts. He said most reviews are done in less than a week.

“When we take longer, there is a really good reason because we have questions and the public wants us to ask those questions,” he said. “Oversight is not made for efficiency.”

He said the reviews are also a deterrent.

“When they are doing a contract and it’s coming here, there is a chilling effect,” he said. “They know somebody else is going to look at it. This has a major impact on how people behave.”

A group of eight unions and 27 good-government, social service and political groups also support the bill.

“Dozens of prominent groups and budget experts from the left, right and center support restoring the comptroller’s full contract review powers,” said John Kaehny, executive director of the good-government group Reinvent Albany. “When the comptroller gets a look at state contracts before they're signed, the public is much less likely to get ripped off.”

By Michael Gormley

michael.gormley@newsday.com@GormleyAlbany

Michael Gormley has worked for Newsday since 2013, covering state government, politics and issues. He has covered Albany since 2001.