MAY 11, 2006, FARMINGVILLE, NY –Brookhaven Town Supervisor Brian X. Foley’s new Department of Finance Commissioner, Kim Brandeau, has drawn up guidelines for handling capital projects and has begun training departmental staff in the new procedures.

“There were no guidelines in place for handling capital projects in the Town of Brookhaven, and that glaring oversight has cost the taxpayers dearly,” said Supervisor Foley. “I promised the residents of Brookhaven Town that I would bring best practices and a culture of competence to Town Hall, and that is exactly what I have done in bringing in Kim Brandeau as Finance Commissioner. 

“Commissioner Brandeau’s new capital project guidelines are a perfect example of how instituting best practices will both save taxpayer money and provide the people with the services that they deserve. If this capital program had been in place years ago, the people in Mastic would have a pool to use right now instead of a $6 million fiasco that has dragged on for years.”

The proper process for the expenditure of capital funds starts with adoption of the capital budget for the next fiscal year at the end of the current fiscal year. Capital funds cannot be spent or obligated until the Town Board adopts a bond resolution and the required waiting period expires. Funds could then be expended for the specific purpose listed in the capital program and bond resolution. After the specific project is completed, the project is closed.

 The new capital project process was unveiled at a Department Heads meeting Wednesday and will be explained at a Commissioners meeting next week in conjunction with the Supervisor’s Office.

The Department of Finance has designated a budget control officer who has begun to work one-on-one with departments to help establish priorities for 2006 capital projects and create a master list of all capital projects currently underway in the Town, a list which currently does not exist.

In the past, the capital program process was a virtual free-for-all. Among the problems discovered by the Foley administration were:

--Using “old capital” funding for items that did not meet capital guidelines and had low periods of probable usefulness. Under the new procedures, such items will be purchased with operating funds, current or future. If it is a major purchase, then a request should be made in next year’s capital budget.

--Using capital funds for items that were not designated in the capital program and/or on bond resolutions. The new procedure is to request that the Town Board amend the capital program to purchase the item and adopt a bond resolution authorizing the purchase.

--Using improper offsets for capital project cost overruns. The new procedure is to identify an appropriate offset and transfer funds by Town Board resolution.

--Project scope changes but capital budget is not amended to reflect change. The Mastic pool is a case in point. The original capital project included $800,000 for minor pool renovations.  As the project was initiated, it transformed into a total reconstruction, with the total project cost escalating to over $6 million. The budget was not amended, and contracts were executed without sufficient funding.

The new procedure would be to request that the Town Board amend the capital program to change the scope and provide additional funding, and then adopt a bond resolution authorizing the additional spending and borrowing. The project should have been stopped until funding was properly in place.