AN IMPORTANT LETTER FROM THE 12/20/18 EDITION OF THE GAZETTE:
Missed bond payment, money for Tough Man: who's watching out for taxpayers
To the editor:
The Village of Croton-on-Hudson spends a great deal of effort to stay at the cutting edge of social justice. Our village government is concerned with the global issues, and we devote village resources to that end. We truly do “think globally” and I realize that is the focus of our village elected officials and municipal staff.
Two recent events remind us that we must occasionally turn our attention to the mundane concerns of running a municipality.
The first instance was the “write-off” of $5,524.93 by our Board of Trustees at the November 5 meeting.
“Write-off” is a fancy way of saying to stick it to the taxpayers of Croton. Adding salt to the wound is the identity of the debtor benefiting from the “write-off”—none other than Richard Izzo’s “Tough Man Enterprises.”
As readers may recall, Mr. Izzo was a favorite of some of our elected officials, including a former Mayor of Croton. Many residents and businesses complained about the inconvenience to residents and economic damage to village businesses, but Mr. Izzo was a friend of the political powers and so he continued to make money at the expense of Croton residents and business owners.
Mr. Izzo left Croton after a village election went against some of his political buddies, but don’t worry: he has done quite well since. With 18 “Tough Man” competitions around the world, multiple sponsors including financial powerhouse Morgan Stanley, and offices in tony Rye Brook, Richard Izzo’s company is not short on cash.
Mr. Izzo remains politically active, rubbing elbows with influential people and lobbying Governor Cuomo about the state budget. Given Mr. Izzo’s history with the Croton Dems, it is understandable that the trustees wanted to give him a little Christmas gift for old times’ sake.
Ostensibly it was simply too much nuisance to collect from Mr. Izzo’s company. According to Village Manager King’s October 31 memo, there were “discussions” with the village attorney, village engineer, village auditor and also “several attempts of reaching out” to get the debt paid. Therefore the Village Manager sought permission to have the Village treasurer write-off the $5,524.93 debt.
Is there anyone reading this who believes the Village of Croton would let them slide on a $5,524.93 debt? Even filing a one-page form and paying a $15 filing fee in small claims court would have allowed for a $3,000 recovery. I’m sure that all those “discussions” among village officials and attorneys cost taxpayers more than $15.
And what is the problem with having the village attorney do his/her job and collect the full $5,524.93? We pay for our village attorney to do legal work on property tax “charity” schemes that are in violation of federal law. We pay for the village attorney to consult on rules to curtail speech during “public comment” period at Village Board meetings (some of those rules are unconstitutional, but that is another story). We pay for the village attorney to sit for hours on end while members of the Board of Trustees rail against the social injustices of the world and pass resolutions telling Albany and Washington what to do.
Is it really too much to ask that the village attorney and village treasurer protect the taxpayers of Croton?
Assuming that Ms. King’s litigation cost argument has merit, then why doesn’t the village at least start—today—demanding a provision for recovery of attorney fees and collection costs in future contracts? That way the Board of Trustees could still give their friend Mr. Izzo our $5,524.93 but at least the taxpayers of Croton will not get stiffed again.
The second surprise was on December 1, when we found out by reading the morning financial news that Croton had missed a bond payment last summer.
The same village machinery which is so efficient when it comes to churning out feel-good resolutions and announcing marches and diversity fairs was unable to find time to tell us of the bond payment failure. In fact, to date no elected official or village staff member has addressed the bond nonpayment in public, and I doubt they ever will do so.
As with the uncollected debt from Mr. Izzo, the village failed to tell us why the payment failure occurred and what steps were taken to prevent recurrence.
For the first time in 120 years, Croton missed a bond payment. Supposedly this bond payment was not made because it occurred at the start of the fiscal year. I don’t understand what this has to do with anything.
This is not like forgetting to pay your cable bill, nor is this a common occurrence in municipal finance. The village has new fiscal years on a regular basis—in fact I am told they happen at the same time every year, hence the term “fiscal year.” Croton is no stranger to bond payments, since we are one of the most heavily indebted municipalities per capita in the State of New York.
Even if the village treasurer was out sick on June 1 or in a rush to head out early on a summer Friday, why is it that the payment was not made until Depository Trust Company called the following Tuesday to ask why the payment had not been made? There is a whole staff at the Municipal Building and presumably someone to fill in if the village treasurer is otherwise occupied or distracted.
I can understand making checkbook errors; I have been known to make a few myself. But I am not a $20 million per year municipal corporation with $30 million in debt.
If I was as dependent as Croton is on people lending me money, I would consider hiring accountants and accounts payable staff to make sure I kept my creditors happy. At very least I would schedule my bond payment dates in Google Calendar, and maybe even consider scheduling the bank wire the afternoon before the due date in case there was a problem on the morning the payment was due.
I don’t mind the decision by our Board of Trustees to “think globally.” It is kinda cute to see our Croton board meetings mimic a grade school model United Nations. I also understand that great minds are annoyed by having to deal with pesky accounting issues. But both of the recent issues raise concern about sloppy fiscal management and a lack of oversight by our village officials.
--Paul Steinberg, Croton-on-Hudson
DON'T FORGET THAT IF WE WON, WE COULD PUT A LIEN ON IZZO'S PROPERTY. I'LL BET HE PAYS HIS BILLS THEN. NOW THAT THE DEMS RULE THE ROOST, TAXPAYERS NEED TO WATCH HOW THE VILLAGE WASTES OUR TAXES. THANKS FOR HELPING US, MR. STEINBERG. I'LL RECALL THIS INCIDENT AND OTHERS AT FUTURE ELECTIONS.
ReplyDeleteAnd of course if you don't talk about it much, no one will ever find out....hah!
ReplyDeleteWhat contempt this village was held in.
ReplyDeleteYes to all these.
ReplyDeleteNot sure why the village could not send out the debt to one of the numerous Commercial Law League attorneys, who for 5% of the debt upfront (approx $275) and then get a contingency fee of anywhere from 20% to 35% would litigate the issue. Really, spending $275 to collect thousands required several discussions with board members and counsel??
ReplyDelete