Press Releases

FOR IMMEDIATE RELEASE
Thursday, January 22, 2004
No. 11
www.nyc.gov/parks

PARKS CONCESSIONAIRES EXCEED REQUIRED CAPITAL IMPROVEMENTS BY MORE THAN $15 MILLION

Parks & Recreation Commissioner Adrian Benepe today responded to the New York City Comptroller’s Audit Report on Parks’ Oversight of Capital Improvements by Concessionaires (EW03-136A). After receiving the draft report on June 18, 2003, the Department of Parks & Recreation investigated the findings and submitted a detailed response on July 2, 2003. The audit reviewed 58 concessions on City parkland and claims that 37 did not complete approximately $10 million in capital improvements. The operating concessions noted in the audit were required to complete $30 million in capital improvements by contract. These businesses met or exceeded their required capital investment by a combined total of more than $15 million. Over $45 million has been privately invested on these City facilities.

"The inaccuracies of the Comptroller’s audit send the wrong message to businesses working with the City," said Parks & Recreation Commissioner Adrian Benepe. "Parks & Recreation is proud of its management and oversight of concessionaires. This successful public/private partnership has resulted in millions of dollars in capital improvements to our City’s parks at no cost to the taxpayer and generates substantial revenue for the City. The fees collected from businesses in this audit have increased from $8 million to $18 million, an increase of 109 percent after their capital improvements were completed."

Parks & Recreation currently licenses approximately 600 concessions, primarily food service and sports and recreation businesses. In Fiscal Year 2003, Parks & Recreation's concessions generated $58.5 million in revenue, which goes to the City’s general fund. Concession capital projects have resulted in record private investment in the City’s parks and substantial revenue to the City.

In a detailed response to the audit, Parks & Recreation documented numerous erroneous findings, inaccuracies, omissions and unsubstantiated claims by the auditors' field inspections including:

- Incorrect statements that imply Parks' concessionaires are authorized to spend less than their capital minimum requirements, which is never the case.
- Unsubstantiated dollar values given for capital projects cited as incomplete.
- Unsubstantiated due dates for the completion of capital projects. - Unsubstantiated claims of revenue loss to the City.
- Failure to include or acknowledge documentation provided by Parks & Recreation.
- Inclusion of capital projects that were previously audited by the Comptroller, whose audits found these concessionaires either met or exceeded their capital requirements.

The recommendations cited in the audit are procedures that, where appropriate, Parks & Recreation currently follows. Parks & Recreation will expand its current policy to assure that all changes to contract requirements, regardless of size, will be documented in writing. The agency will also expand its monthly revenue management meetings to include reports on concession capital projects. The reports will include status of construction, design approvals, receipt of plans and documentation of capital expenditures and certificate of completion issuance.

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