NY Pols Subpoena Records From Development Group

By MICHAEL VIRTANEN
|  Saturday, Jun 19, 2010  |  Updated 11:15 AM EDT
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NY Pols Subpoena Records From Development Group

AP

The committee's chairman, Assemblyman Richard Brodsky, said he has also ordered officials from both corporations to appear for a hearing on June 28.

New York lawmakers have subpoenaed financial records from a publicly funded economic development group as part of a probe into why its top two executives got nearly $1 million in bonuses.

The state Assembly's Committee on Corporations, Authorities and Commissions said Saturday that it is seeking annual reports and compensation records from the Fulton County Economic Development Corp. and its for-profit affiliate, the Crossroads Incubator Corp.

The committee's chairman, Assemblyman Richard Brodsky, said he has also ordered officials from both corporations to appear for a hearing on June 28.

Calls to the corporations and their lawyer were not immediately returned Saturday.

The development group is locked in a dispute with the Assembly over its independence and oversight. So far, it has refused to open its books to a new agency overseeing public authorities, the Independent Authorities Budget Office.

In a statement last week, FDEDC defended the pay awarded to its executive vice president, Jeff Bray, and Crossroads' Executive Vice President Peter Sciocchetti.

It said Crossroads is a real estate holding company that receives no public funding, and that pay for the executives was linked to their performance and based on proceeds from the sale of $31 million in real estate.

Bray was paid $420,861 in 2007 and $571,452 in 2008, according to the groups' tax returns. Sciocchetti received $377,742 and $547,962 those years. Much of that compensation was in bonuses. Bray's 2008 salary with the FCEDC was $170,483. Sciocchetti's base pay was $69,935.

The corporations have declined to file requested documents with the Assembly committee and the new Independent Authorities Budget Office, questioning their jurisdiction. The FCEDC has argued that it is a private organization, not a government entity. The new subpoenas also apply to a third corporate entity, called Crossroads Incubator Corp. II.

Brodsky, who is a candidate for attorney general and an advocate of tighter oversight of public authorities, chafed at the group's refusal to cooperate.

"The combination of apparently excessive and secretive compensation and stonewalling by these three corporations and their officers has made these subpoenas necessary," he said. "The truth will come out so that we can finally decide what legislative remedies are required."

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