Development group to work publicly
GLENVILLE The leader of the new Glenville Local Development Corp. said he believes the board's business should be conducted in public -- even though there is not a definitive opinion on whether such organizations must comply with the state Open Meetings and Freedom of Information laws.
The LDC was officially incorporated in June so it could make loans to businesses using $565,000 from a Community Development Block Grant that had been awarded originally to Solid Surface Craftsman owner Alan Boulant to expand his business. Boulant has repaid the money, but it can be used only for economic development purposes.
Glenville LDC Chairman Jim Martin said he personally intends for the group 's business to be conducted in the open.
"These are public funds that are the seed money for this organization. I think those who are interested ... should be able to see what's going on," he said.
The LDC will hold meetings at the Glenville Municipal Center for the foreseeable future.
"I'd like to leave them open to anyone. I think that's the right thing to do," he said. "There may be cases where discussing an individual or individual company's finances, we might have to keep that under executive session. Other than that, I'd be fine with it."
He said he would raise the issue at the next meeting.
David Kidera, director of the state Authorities Budget Office, said a local development corporation is considered a nonprofit corporation, which doesn't have to comply with the Freedom of Information and Open Meetings laws. However, his office audits those corporations created by local governments and believes they should follow the rules.
"We make the argument that they're subject to the same FOIL and freedom of information requests as any other public or local authority," he said. "I think you're going to get some differences in interpretation."
LDCs have been under increasing scrutiny. The state Comptroller's Office last year issued a report saying some municipalities were using LDCs to take debt off their books, get around competitive bidding laws or flout other regulations regarding use of public money.
There has not been a lot of case law on whether LDCs must comply with the Freedom of Information and Open Meetings laws. Camille Jobin-Davis, assistant director of the state Committee on Open Government, said they need to comply if there is substantial governmental control of the LDC's operations.
A relevant case on the subject is Buffalo News vs. Buffalo Enterprise Development Corp., which was decided by the state Court of Appeals in 1994. The newspaper was suing to have Freedom of Information Law requests fulfilled and the court ruled the LDC had a governmental purpose and was an agent of the city because the city appointed the board and had the authority to audit its budget.
"The city was inextricably involved in the core planning and execution of the LDC's program," Jobin-Davis said.
The Glenville LDC will report to the town about its activities, but the Town Board will have no official role, according to LDC member Jim Valachovic. Still, Valachovic said he fully supports complying with the Open Meetings Law and FOIL.
"We want to keep it as transparent as possible and make sure everybody knows what we're trying to do," he said.
Valachovic recalled a recent situation last month in which the state Authorities Budget Office censured the Waterford Local Development Corp. for failing to file audit reports from 2010 to 2012 and not filing annual reports for 2011 and 2012.
"We don't want to be like that at all," he said.
The organization is still trying to recruit two members to fill out the five-member board and is taking applications through Dec. 2. It wants to be up and running by the new year and is putting together requests for proposals for legal and accounting services, according to Valachovic.
He said he thinks people are excited about the LDC. "I think it's got the buzz in the business community, which is what we want."