State slams Erie County Water Authority; says it operated under veil of secrecy

BUFFALO, N.Y. (WKBW) - The state agency that oversees public authorities in New York has released a blistering report on the Erie County Water Authority, calling on the county legislature to clean house and replace commissioners of the board.

The Authorities Budget Office, which based its findings on the authority's operations in 2016 and 2017, found the following:

  • Board members routinely approved resolutions and transactions while lacking adequate information. A contract that granted a 36 percent salary increase for the deputy director was approved without the board reviewing the terms of the contract. Another contract, also approved without review, gave the director a 'golden parachute,' guaranteeing him a full salary for the length of his contract regardless of whether future boards would want to terminate him.
  • Much of the authority's business was not conducted in meetings open to the public, which is a violation of the provisions of Open Meetings Law. Instead, board members operated under a "veil of secrecy."
  • The authority avoided notifying customers of expected water rate changes. The authority determined in October 2017 that residential water rates would increase to $3.23 per 1,000 gallons for 2018 and increase another seven cents for 2019. The authority has not disclosed the increase to customers. 

A 7 Eyewitness News I-Team investigation last year found of the nearly 280 employees at the water authority, 10 percent - or 28 employees - earned more than $100,000 in 2016. ECWA Executive Director Earl Jann made more than $136,000 that year, an increase of almost $2,700 from 2015. His deputy director earned even more - almost $160,000 in 2016, up from $151,461 the previous year. 

In addition, the ABO determined the authority did not appropriately respond to all Freedom of Information requests it received. Responses to FOIL requests were either incomplete, or, in some cases provided inaccurate information. 

"Based on the historic issues with transparency and accountability at the Erie County Water Authority, we believe that the Authority would be best served by new leadership, that is more cognizant of its fiduciary responsibility to the Authority and the public," said Jeffrey Pearlman, ABO director. "A new board will help to implement and enforce its policies in an environment of transparency." 

Terrence McCracken, secretary to the authority, tells 7 Eyewitness News that although the board disagrees with many items in the report, new board members have already resolved 16 of 21 items identified in report.

Erie County Legislature Minority Leader Joseph Lorigo and Legislator Thomas Loughran released a joint statement this afternoon, stating, "We need to hit the reset button. The report shows the authority and teh Commissioners in charge during the review have failed residents. Many changes are needed at the Water Authority. We agree with the recommendations of the report and Believe Commissioner [Jerome] Schad should resign immediately."

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