Canceled Coalition meeting spurs questions

by Larry Austin
Lewiston Porter Sentinel, March 25, 2006

Attorneys for the Niagara Power Coalition put the kibosh on a meeting planned by the Town of Lewiston to discuss details of a recently completed financial accounting report.

Just minutes before a 10:30 a.m. meeting at Lewiston Town Hall Thursday, NPC legal counsel notified NPC members by e-mail and fax that the meeting was canceled, saying the procedure to call the special meeting was not properly followed.

Attorney R.J. Stapell of the Harris Beach law firm faxed a letter to Steve Brown of Brown and Co., who conducted the accounting report, stating: “The chairman has directed me to advise you that if such meeting is held, it is without his consent or approval, and you are not authorized to attend such meeting and there shall be no discussions regarding your report.”

Stapell further said discussions of the report would breech confidentiality obligations.

Only Lewiston Reps Attended

Only representatives of the Lewiston-Porter Central School District and the Town of Lewiston attended the meeting.

The seven-member coalition voted unanimously Jan. 18 to hire the accounting firm of Brown and Co. to go over NPC transactions and report to the coalition. Lewiston Town Supervisor Fred Newlin called the special meeting for March 23 to talk with Pat Brown about the review after Brown was excluded from the March 16 NPC meeting during which his report was made public, Newlin said.

“I don’t think I was the only member last week to be shocked by the fact that Brown and Co. were not invited to the presentation” of the review, Newlin said.

The report found irregularities in expenditures of funds for the group. Newlin questioned the confidential nature of the report, noting that the report was handed out freely to members of the press at the March 16 NPC meeting.

Wants Answers

Wanting answers to certain questions, Newlin called the special meeting under Section V of the NPC bylaws, which said they could be called at any time by any member. Chairman of the NPC William Ross “exercises freely” the rule, Newlin said. “I think there are enough questions now with this audit that, as supervisor, and I’m sure that the town board will support me on this, I’m going to take whatever documentation and turn it over to New York State comptroller and attorney general’s office,” Newlin said.

“It’s clear to me, and there might be other members of the coalition that will agree with me, that there’s enough here that needs to be investigated,” he added.

Newlin said he could not understand why Stapell would direct the auditor not to answer questions.

“The longer we don’t hear from them the longer we’re going to get questions from the public, and legitimately so, as to what exactly is going on with the finances of this organization.” Newlin said.

The NPC is a seven-member group created to negotiate with the New York Power Authority a host community agreement leading up to NYPA’s application for relicensing the Niagara Power Project with the federal government.

Recommendations

Brown’s report found several discrepancies in past use of NPC funds. After review of the Brown report, Harris Beach recommended several actions:

•That the NPC request a $17,180 repayment from Mark Zito, former NPC executive director, for overpayment of $1,000 a year from 2001 to 2005 and two $6,590 “illegally authorized salary increases for the years 2004 through 2005.”

•That the NPC request a $23,410 repayment from Susan Ross, described as Zito’s girlfriend.

•Submit the corrected 1099 forms for 2002 and 2003. In 2002, $23,410 was paid Ross with a 1099 form issued to Zito. In 2003, $23,410 was paid Zito with a 1099 issued to Ross.

Full Audit

Lew-Port Interim School Superintendent Don Rappold, L-P Board of Education President David Schaubert, and Newlin agreed that next step is a full audit, which Schaubert said the report would just determine the validity of the bills paid.

“I thought at the last meeting where we talked about the procedure, that if the study revealed anything that was unusual, inappropriate, that we were going to ask Brown to do a full depth audit. And that’s, I thought, the step we we’re at next,” Rappold said.

Schaubert called it “almost a mandatory step, as far as I’m concerned, a full audit of every transaction that’s occurred.”

“We’ve got to clear this up and walk away from it so we can move forward,” he added.

Schaubert continued, “Whether there was anything illegal or not, which to the layman looks like there was, Mr. Zito has embarrassed the group and reduced the effectiveness of the group.”

“To me, there’s obstructionism going on, and then you start using the ‘cover-up’ word after that. There’s no reason not to move forward directly to resolve this,” Schaubert said.