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Local News

May 14, 2014

Comptroller blasts town's oversight of grants

A scathing audit from state Comptroller Thomas DiNapoli accuses Richmondville town officials of lax oversight over the construction of the $5.6 million recreation and fitness facility called the Maranatha Family Center.

The 85,000-square-foot building opened in October 2012 and closed just 11 months later when the organization running it could no longer afford to pay the utility bills.

Nearly half the funds for the project came in the form of two government grants totaling nearly $3 million.

DiNapoli’s report was issued 11 weeks after The Daily Star revealed the audit had been commenced. The newspaper story pointed out that the Maranatha Center “stands in Richmondville as an example of a project that raised hopes and expectations but in the end consumed significant taxpayer dollars that officials now admit will never be fully recovered.”

The comptroller’s audit found that neither the Richmondville board nor town officials worked to keep the project within the planned construction budget of $3.8 million. Cost overruns for construction totaled about $450,000, or 12 percent more than original estimates, the report found.

“Had the Board adequately monitored this Project, some of these deficiencies could have been avoided,” the audit stated.

The state Business Development Corp. is seeking to recover $1.85 million through a foreclosure action initiated in December against the developer, Stella McKenna.

The audit said that the two grant applications for the project were prepared by consultants hired by the the developer on the town’s behalf. It was those applications that reeled in a $2.3 million “Restore New York” grant from the state Empire Development Corp. and another $650,000 in federal community development block grant funds.

The report said town officials did not review the work by the developer’s consultant, to ensure monies were spent for proper purposes. For instance, the report said, a $75,000 duplicate payment was made using grant monies for a land purchase.

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