Thursday, October 25, 2007 at 12:30 p.m.
The Whitestone Bridge watches over an enormous boondoggle at Ferry Point Park in the Bronx. Photo by Emmcnamee via Flickr/
The Ferry Point Golf Course was looking like multi-million-dollar boondoggle back in 2002 just months after it was announced—and it hasn't gotten any better. An audit released Thursday by city Comptroller William Thompsom reveals that the city overpaid a vendor $6 million of taxpayer money and the Parks Department hardly even checked to see if the work got done.
Though the project, inked in the final days of the Giuliani administration, was slated to open in 2003, the city has spent $7.2 million on the project to date and has only an environmental mess—not a PGA-style professional golf course—to show for it.
“The Parks Department absolutely dropped the ball when it came to the Ferry Point Golf Course,” Thompson said in a statement. “The Parks Department failed to not only ensure the timely completion of this project, but also failed to be vigilant of capital improvement costs at the golf course. The Parks Department paid for work for which the City was not liable, and lost out on millions of dollars in revenue. More than seven years after the concession agreement was signed, the golf course is not nearly complete.”
As reported by the Voice in 2005, the city was supposed to collect a minimum $1.25 million in fees from Ferry Point Partners who won a contract to operate the course for 35 years. Instead the city has laid out millions. From the Voice:
By contract, the city is responsible for dealing with environmental cleanup on the site and has already spent more than $6 million. Of that, about $1 million went to the law firm of Carter Ledyard & Milburn for defeating lawsuits filed by the New York City Environmental Justice Alliance that demanded a full environmental review. Gagné says about $2 million has gone to Gannett Fleming Inc., the company that conducts DEC-mandated monitoring on the incoming truckloads of fill.
Some of the lowlights from Thompson's audit:Parks allowed Ferry Point Partners to reach an agreement with its subcontractor, Laws Construction, in which Laws Construction would be paid to import and shape the fill required to construct the golf course by retaining “tipping” fees paid by waste haulers seeking to dispose of construction and demolition debris from other sites. According to Laws Construction, the “tipping” fees collected totaled $15.13 million. If Parks had collected the “tipping” fees while Ferry Point Partners was still carrying out the work, the City could have paid Ferry Point Partners the estimated $1.26 million for remediating the methane gas and $3.58 million for permits and environmental inspectors, which still would have yielded $10.29 million in earnings for the City.
From June 2002 to September 2006, Parks reimbursed Ferry Point Partners $7,242,754 for remediation work performed at the premises - an overpayment of $5,978,416. In an independent cost analysis, auditors estimated that the cost of the remediation, including landfill gas trench, installing monitoring wells, performing maintenance, engineering design and a required monitoring program, should have cost only $1,264,338. Moreover, auditors found that the improper reimbursements included work items associated with Ferry Point Partners’ obligation to carry out the required capital improvements, such as the costs of importing fill to construct the golf course, and other costs which were not eligible for reimbursement.
Since Ferry Point Partners had not completed the required capital improvements by the stated date of April 15, 2004, the City lost out on $3,020,833 in license fees through September 30, 2006. Furthermore, as of September 2006, the only improvement underway was the 18-hole golf course. Given the rate of progress, auditors estimated that all 14 improvements would not have been completed until 2011, by which time the City would have forgone $9,712,500 in fees.
Auditors found that part of the delays resulted from Ferry Point Partners’ decision to revise the design of the golf course, requiring additional fill, which also allowed for the reaping of additional “tipping” fees by Laws Construction. Delays also included the failure to obtain required permits on a timely basis.
The agreement stipulates that if Ferry Point Partners failed to complete a particular improvement by the date specified, it could be required to pay the City liquidated damages of $500 a day. As of September 2006, Parks could have assessed Ferry Point Partners $6,286,000 in liquidated damages, but did not.
The agreement and file documentation reviewed by auditors lacked work scopes and estimates prepared by Parks that could have been used to assess whether the remediation work was being carried out effectively and in a timely manner.
Only 55 of the total 807 invoices comprising the 12 payment requisitions contained evidence that Parks officials had actually reviewed the invoices to verify that the work was performed and was for remediation. Parks employs a single revenue architect to monitor payments to Ferry Point Partners and 50 other concessions. Further, although Parks has a full time staff of engineering-audit officers, they did not review the reimbursements because according to those officers, they were not able to assess whether the work was actually done. Additionally, Parks’ capital project division of architects and engineers did not oversee any of the work.