Purpose

To determine whether the New York Power Authority has accounted for all of its real estate holdings, determined the need to either hold or dispose of those properties, and disposed of property on terms beneficial to the State. The audit covers from January 2010 through July 2013.

Background

The New York Power Authority (NYPA) is the nation's largest state public power entity and a leader in supplying the State with electrical power. Public Authorities Law Section 2896 requires each authority to maintain adequate inventory controls for its property and report annually on all property held. It also requires authorities to determine which property shall be disposed of and transfer or dispose of such property as promptly as possible for fair market value. NYPA reports that, as of December 31, 2012, it owned 48,941 acres of property associated with 12 power generating projects, along with an administrative building in White Plains and several permanent easements.

Key Findings

• NYPA did not include all of its property in the reports it submits to the State and posts on its website. For example, NYPA did not update the information systems used to account for its real estate inventory timely. In addition, NYPA has not been consistent in how it reports disposals of real property. NYPA does not regularly review its real estate portfolio to identify properties it no longer needs, as required.
• NYPA property with a fair market value of more than $15,000 was leased for less than fair market value without notifying the Governor and Legislature, as the Law requires.

Key Recommendations

• Ensure that information systems used to track real estate holdings are updated timely to reflect changes when property is acquired or disposed.
• Evaluate the continued need for property owned and property leased from other entities.
• Notify the Governor and the Legislature when property is leased for less than the fair market value and provide the justification for such action.

Other Related Audits/Reports of Interest

Rochester-Genesee Regional Transportation Authority: Real Estate Portfolio (2012-S-90)
Capital District Transportation Authority: Real Estate Portfolio (2012-S-91)