Controversial Peekskill BID Renewed for Next Three Years

Equipped with a well-prepared statement in protest of the immediate extension of the Peekskill Business Improvement District, Patty Villanova implored the city to delay the BID's renewal at Monday's Common Council meeting. 

Villanova cited a State Comptroller's audit report released on Dec. 16 which found the City of Peekskill has no written agreement with the BID and that its oversight of the entity has been inadequate. The comptroller's office also reported that the Business District Management Association, which runs the BID, neglected to maintain records of its meetings and spending and distributed grant money to its own chairman Joe Lippolis' business. The audit also found that the association's executive director Ed Burke used BID funds to make payments to family members and himself. The names were not cited in the audit report, but on Dec. 27 a spokesperson from the State Comptroller's office confirmed that Lippolis and Burke were the chairman and executive director referenced in the official report.*

"I don't understand why you are covering up the report and rushing to renew the BID without even fixing the report's findings," Villanova, a current BID Association board member and former chairwoman, told the Council.  "Why not wait a year and put in the reforms that are needed?"

Just before the Common Council voted to extend the BID from December 2010 to December 2013, Councilwoman Drew Claxton thanked Villanova for her comments and said, "The audit brought the city's understanding of the BID completely on its head. We thought the city's relationship was at an arms length from the board."

In his report, State Comptroller Thomas DiNapoli provided seven key recommendations for the city, including that the city enter into a clearly defined agreement with BID; establish policies for safe-guarding cash, for record-keeping and regarding grant applications; and develop performance measures. He mandated the city to provide his office a written corrective action plan within 90 days of Dec. 16.

Villanova said she has been documenting BID activities since 2006, and that in 2009 she wrote to then-Attorney General Andrew Cuomo asking for an investigation.  Earlier this year she hired her own attorneys to assess the BID's by-laws and was then ousted from her chair position in September for being a whistle-blower, she said.

Claxton and Mayor Mary Foster elaborated that the auditor's understanding of what the city's relationship with the BID should be is much different than the city's understanding has been.  

"But in order to make a plan, we need a BID intact that we can plan with," Claxton said.

Foster said the weaknesses exposed by the audit date back to the BID's creation and the city will be working diligently to put a plan in place that the association board has to agree to follow.  "It will be a written agreement with the BID management association that says thou shalt…and the Board has to agree to follow it," said the mayor. 

She added that BID management will be required to create an advisory board and to have a paid staff to reconcile documents with the city comptroller.

"Do I feel vindicated?" Villanova proposed to herself at the end of the meeting.  "It's what they say about second marriages, it's the triumph of hope over experience."

*EDITOR'S NOTE: This original article did not clearly explain that Lippolis and Burke were not actually named in the report. To clarify, the following sentence was added on Jan. 13, 2011: "The names were not cited in the audit report, but on Dec. 27 a spokesperson from the State Comptroller's office confirmed that Lippolis and Burke were the chairman and executive director referenced in the official report."