Purpose of Audit

The purpose of our audit was to evaluate the propriety of the Agency’s financial and operational activities for the period October 1, 2012 through March 12, 2015.

Background

The Village of Fairport Urban Renewal Agency is an independent public benefit corporation that was established to plan and undertake urban renewal projects in the Village of Fairport. The Agency is governed by a five-member Board of Directors, appointed by the Village Board. Operating expenses for the 2013-14 fiscal year totaled approximately $2.36 million.

Key Findings

• The Board manages the Agency as if it is a department of the Village of Fairport Office of Community and Economic Development, which inappropriately gives the appearance that the Agency is legally affiliated with the Village of Fairport Industrial Development Agency (FIDA) and the Village of Fairport Local Development Company (FLDC), and it has inappropriately commingled bank accounts and accounting records for the three entities.
• The Agency inappropriately gifted $250,000 in assets to the FLDC.
• The Agency made an annual contribution to the Village without a basis for the amount or a contract stipulating the services covered by the contribution.
• The Agency inappropriately received subsidies from the FIDA.

Key Recommendations

• Direct and manage the Agency’s operations as a separate and independent entity with its own governance structure and separate and distinct bank accounts and accounting records.
• Seek remuneration from the FLDC for the unauthorized gift of property.
• Finalize a written agreement with the Village specifying appropriate consideration the Agency will pay for services the Village provides.
• Repay the FIDA for expenses not properly reimbursed.