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Authorities Budget Office concludes Carthage Development Corp. oversteps core mission

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CARTHAGE — A recent review of the Carthage Industrial Development Corp. by the state Authorities Budget Office concluded the corporation funds some activities outside its core mission, such as municipal operations and residential housing.

The Authorities Budget Office led the review as part of a statewide initiative that will review a sampling of nonprofit local development corporations, or LDCs, to better understand their public purposes and how taxpayer-backed funding is spent.

The report says the CIDC, governed by a 13-member board, was established in 1998 to take ownership of and lease the village’s hydroelectric plant on West End Avenue and redevelop the adjacent mill property.

Revenue generated by the plant gives the corporation the ability to engage in a wide array of economic activities, but the study concludes that some of them have fallen outside of its core mission.

Managing residential housing operations, for example, and funding general operations of local governments are both activities that go beyond the agency’s enumerated powers, according to the study.

The report underscored the following examples of fund mismanagement:

n From January 2011 through September 2013, the corporation provided more than $350,000 to the village of Carthage, including $250,000 to fund the re-establishment of its community development director position.

n During 2011 and 2012, the corporation provided $80,000 in grants and loans for a village public works project and paid $58,329 when the cost of the village’s new streetlights exceeded its New York State Main Street grant award.

n Over the same period, the villages of Carthage and West Carthage and towns of Wilna and Champion incurred more than $17,000 in costs of grant-application writing paid for by the corporation.

Though LDCs have broad authority to undertake projects that lessen the burden of government, the report states, “they have no clearly enumerated power under Section 1411 of the Not for Profit Corporation Law to create affiliates for such purposes.”

The six-page report on the CIDC is available online at http://wdt.me/rPkrZH.

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