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State Report Alleges Lax Fiscal Management of Putnam National Golf Course
County contends State recommendations could cost taxpayers more
by Margaret Sternberg
The results of a NYS Comptroller's audit concerning the management of the Putnam National Golf Course and their internal purchasing controls have revealed a number of issues that County Executive Bob Bondi has said he will take action to address.
The audit, released the week of July 9, 2007, focuses part of its criticism of the County on the County not having used a Request for Proposals ("RFP") to select a manager for the golf course.
The audit also cites the specific management agreement the County entered into with Putnam Golf, Inc., "which is solely owned by the Putnam County Commissioner of Highways and Facilities."
In a scathing indictment, the report accuses the County of having established Putnam Golf, Inc. as a way to "avoid oversight that normally occurs in County departments. In effect, the County has established an agent to operate in a manner in which the County could not act. The Golf Course is the only County-owned facility that does not have a detailed budget and a budget line item."
The report observes that the agreement "contains terms and conditions that allow the County Executive to oversee Putnam Golf, Inc. in a manner similar to a County department but with diminished oversight from the County Legislature," and alleges that under the terms of the agreement, "the vendor, a County employee, has no incentive to operate and maintain the Golf Course in an efficient and economical manner...[it] can earn no profit or incur no losses."
Harold Gary, President of Putnam Golf, Inc. said, "Even though the State says that the contract itself is written in a manner in which anyone in the position would not necessarily have an incentive to make a profit, the way in which I was raised and brought up makes me always strive to do the best job possible in any position I hold."
The audit said the management agreement entered into by the County Executive is "inappropriate and not in the best interests of the taxpayers." Putnam County Executive Bob Bondi responded that Commissioner Gary received no additional compensation for his duties as President of Putnam Golf, Inc. and had "zero pecuniary interest in the contract." Mr. Bondi continues that he had the best interests of the taxpayers in mind, saying "Nobody can argue that this is a good deal," adding that he expected costs to rise in the operation of the Golf Club even under the RFP process.
Mr. Bondi explained that one of the problems with the RFP process was that selecting the lowest bidder may not be "in the best interests of the public," citing the providing of health care services, in which bonds may have been formed between provider and patient and the severing of those ties to go to a lower-cost provider may be counter-productive.
The report recommends that if the County still chooses to have the Commissioner operate the Golf Course, the Golf Course should be included in a County Department and "properly" account for all revenues and expenses. It also states that if the County chooses to contract with a vendor to run the Golf Course, it should seek competitive bidding through an RFP, and the County should maintain a detailed budget and accounting of all monies spent by the County for the operation and maintenance of the Golf Course.
County Executive Bondi said, "We are going to abide by [and] follow all of the recommendations of the State Comptroller, even those appearing non-workable or non-productive." Mr. Bondi stated there had been "no intent to deceive" and that these [budget and accounting line item] issues had been "resolved for the future by a policy statement by the [Putnam County] Legislature."
In addressing specifics of the budget lines for the Golf Course, Mr. Bondi said, "It doesn't matter what line the money comes from, all County facilities must be maintained by the Department of Highways…with the money used as necessary" to maintain their upkeep.
Legislator Tony Hay said that he believed "The State Comptroller's report says everything the Legislature has been saying since Harold Gary was appointed by the County Executive as a so-called temporary replacement for the former President of Putnam Golf, Inc. over two years ago."
Legislature Chairman Dan Birmingham said, "It's my sincere belief that the County Executive will follow the directives of the State Comptroller. He didn't listen to us for the last two years, but I can't believe he would ignore a strongly thoroughly-worded suggestion from a state authority."
Mr. Bondi said that for the immediate future Mr. Gary "has graciously agreed to stay on until the County selects a proposal from the RFPs." Asked what would happen if Commissioner Gary sold Putnam Golf, Inc., Mr. Bondi said the County would keep any profits that are made.
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