Yonkers Auditor Nick DeSantis of PKF O’Connor Davies, LLP, Is a Maelstrom of Concern

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The Hezitorial

   The Videotape of January 15, 2019


Deficient Financial Past v Potential Financial Prospect

The Hezitorial Revealing a Vendor’s Conflicted Responsibility, Controlling Political Influence Emboldened by Campaign Donations, Wanting Fiscal Controls, Failed Financial Analysis, Deficient of Known Best Practice, Stealth Political Operative

Telling Reveals Mayor, Yonkers City Council, and The People Kept Ignorant and Unaware

The Yonkers City Council Must Learn to Serve the Public Interest Rather than the “Family and Friends Network” of Sychophants

Charicature of a younger, better looking Editor-at-Large / Radio Host Hezi Aris.

The $55 million shortfall “said” to have been designated for the Yonkers Public School (YPS) District and defined as such to the Yonkers Board of Education (YBoE) Board of Trustees was caught blindsided after it was recognized that the funds “allegedly” promised had not materialized about a year-and-half after the “alleged” allocated funds were expected by the YBoE.

Nick DeSantis, a partner in the firm of PKF O’Connor Davies, LLP, was the City of Yonkers’  Auditor. He was hired and rehired from one administration after the other for decades. 

Nick Desantis, partner in the firm PKF O’Connor Davies, LLP

The relationship between DeSantis and the City of Yonkers (CoY) evolved over time. From one-time Yonkers Acting City Manager since 1984 to becoming a partner in the firm of PKF O’Connor Davies, LLP at present. He would become favored CoY auditor, engaging the task and responsibility in auditing the Yonkers Industrial Development Agency (YIDA), and the Yonkers Board of Education (YBoE). Therein is one aspect of the issues revealed described herein. He climbed the ladder becoming part of the “family and friends network”. Yet upon reflection, despite having learned the intricacies and vagaries over fiscal concerns, he has yet to steer beyond the financial constraints that have been a burden to the taxpayer, stymying Yonkers’ potential. He professes his erudite comprehension of auditing and the remedies learned in Yonkers and beyond for some 34 years yet he has not been a catalyst in guiding CoY from the financial peril it faces year after year. His immersion in fiscal management and auditing for some 34 years in Yonkers has proven to be debauched by his inability to guide CoY from the dangerous shoals it seems to skirt. His legacy is not one of prudent guidance. And it is at this juncture that one learns he can advise but he cannot demand compliance. If he is not sufficiently instrumental in guiding best fiscal practice for CoY, who then makes the final decisions that run astray of appropriate guidance for Yonkers’ prudent financial course and conduct. If anything, his lack of definitive guidance has only mired CoY in political discourse behind closed doors, financial doom and gloom, and his own self-preservation in holding onto CoY’s fiscal reigns gleaning no relief to the taxpayer.

No one recognized the $55 million shortfall until the YBoE had already spent $40 million of an allocation that did not then or thereafter materialize. Finger pointing became the obfuscating game plan. No one was in charge, no one understood what transpired, no one could prove in writing the “alleged” allocation, when it was signed, or even by whom; or worse still, it was never divulged. The outcome was a wake-up call that smarted as would a hard slap across the face. Alas the remedy fell on the back of Yonkers taxpayers to compensate for the “error” by borrowing the funds after submitting to an inter municipal agreement (IMA) between New York State and CoY. The deficiency, the IMA agreement, the cost of the bond, and interest accruing over time has come to exacerbate the financial standing of CoY to the detriment of Yonkersites, the City of Yonkers, the YBoE, YPS District, teachers, employees of every stripe, and pupils of every grade level.

Maintaining his position as the chosen auditing vendor has engaged DeSantis and his firm in what may best be described as a “quid pro quo” return on investment. DeSantis and his firm are quick to donate to fundraising drives to those who vote for his being hired every time a re-election is anticipated or campaign efforts are underway. DeSantis has become adroit in “donating” to one campaign after the other to those who may have say in his appointments and / or reappointments.  

DeSantis is evidently a consummate politcal operative, protected by his “friends and family network” standing. One may surmise he is more capable at influencing those who preside in his gaining his contract than guiding CoY toward a fiscally prudent course.

DeSantis rattles the Yonkers City Councilmembership as they scurry for his donation, dividing those who recognize the failings over many years with the prospect of the membership failing to garner voter support with financial backing toward their election / re-election efforts

Yonkers Tribune has learned that the Yonkers City Council is quick to pander to the wants of DeSantis to gain his financial backing. The City Council membership have tied their vote over renewing DeSantis’ contract to the financial backing from DeSantis despite DeSantis’ inability to direct CoY to a better financial outcome. That may be the “conflicts of interest” that weigh on the City Councilmembership’s eventual vote to again approve or deny DeSantis’ / PKF O’Connor Davies, LLP contract with CoY, YIDA, and YBoE. Yonkers residents will suffer the consequences as attested to the lack of prudent oversight of Yonkers fiscal standing for over three decades. 

Lest anyone suggest that DeSantis / PKF O’Connor Davies, LLP were not sufficiently responsible for the YBoE or the YIDA when the $55 million crisis first came to light, one must ask since DeSantis / PKF O’Connor Davies, LLP was overseeing and auditing CoY’s books, and all payments emanated from the Department of Finance, why the year-and-a-half pending $55 million crisis was not discovered within a few months’ time? And why the Office of the Finance Commissioner continued to pay bills when funds were not in the city coffers. DeSantis could not have been blind to this fiscal reality. Yet that would be proven not to be the case over time.

That historical perspective leads to only one conclusion, that their capacity as auditors has proven wanting. 

Yonkers New York State Comptroller Thomas DiNapoli has advised that best practice is to change vendors so that different perspectives may bring about a more prudent and efficacious outcome, asking for a formal request for proposal from other firms may also be fiscally advantageous.

If CoY was so skillful in its fiscal guidance, why has CoY languished in the same monetary hole for those same three decades, vacillating from $25 million to $90 million all those years. In 1984, CoY, the fourth largest city in the state with 195,000 people then anticipated a deficit of $71 million over the upcoming 17 months. Until the Wednesday meeting of that revelation, Yonkers officials had been saying that the deficit stood at between $12 million and $15 million for the remainder of the current fiscal year which ended on June 30, 1984. In his Albany report, Mr. DeSantis confirmed those figures but added, in a 15-page report, that the 1984-85 gap now appeared to be as much as $56 million, according to the former Yonkers Mayor and the NYS Lieutenant Governor Alfred B. DelBello.

The takeaway, as anyone may surmise by this telling, is that not much has changed. Some of the very actors then on the scene continue to be immersed with the same reality then that continues to this day. CoY is still the fourth largest city in New York State. The population then was 195,000 people as opposed to just shy of 200,000 today. The deficit is said to be one figure, yet turns out to be 4 ½ times greater than it was initially said. The anticipated FY2019-2020 Budget will also be in the same neighborhood as then, somewhere in the $65-$75 million deficit. 

Albany will exact a cost for CoY’s slow response to its fiscal travail. Despite three people in the room, one who is the Senate Conference Leader Andrea Stewart-Cousins (D-Yonkers), Yonkers will have to engage in fiscal pruning and increased real estate valuations and commensurate tax increases, among other disciplines that will weigh heavy on Yonkersites’ capacity to define a sustainably prudent fiscal demeanor. 

So what will it be Yonkers? More of the same with the commensurate outcome or a new vendor whose oversight of fiscal policy has proven worthy of their employ elsewhere and may thereby be tasked to do likewise in Yonkers.

eHeziYonkers Auditor Nick DeSantis of PKF O’Connor Davies, LLP, Is a Maelstrom of Concern

Comments 20

  1. Last nights city council was an embarrassment to our city ,insults and silly politics, at least yonkers residents will know what to expect for 2019 – VOTE THEM ALL OUT

  2. Tonight’s council meeting is another example of business as usual. The childish behavior and commentary about the accounting firm was somewhat insulting. This firm is getting paid to inform you, make recommendations and educate you on the process. This firm is not doing you a favor they are doing what they are paid to do. We continue having budgetary problems, using the same firm year after year and none question if they ought to explore other firms that might benefit the city. Something is wrong with this council. They are either incompetent or simply don’t have the best interest of Yonkers in mind when making these decisions.

    Please stop prentending to like each other, it’s evident you all do not get along and your priorities are not in the best interest of the residents but of your own.

    1. Yes, I heard, but there was not one iota expressed to validate that position. I had no idea that the City Council membership was engaged in any discussion that they did not want to come out. The article I wrote was based on recognizing that the contract to extend Mr. DeSantis’ contract had expired and that he sought an extension. He is not a bad guy; he is an astute auditor. At issue is if he indeed is sharing all he knows with the City COuncil or, if he does, whether they comprehend it. What became evident is that they are collectively feeling guilty because they believe an individual or individuals leaked information to the Yonkers Tribune, derogatorily referred to as “a blog”. Knowing the contract was coming up for renewal, and recognizing that the city suffered a $40million shortfall that could have been as great as $55 million, I wrote the story. Notice that not one individual was targeted. Not one person was mentioned. In fact I wrote in a comment that I believed everyone would vote in approval of the contract. I was wrong. The vote was 6 for and 1 against. The bottom line, noted by comeone in a recent comment, that while they thought I was smart, I knew little of how grants function, that is how they are paid out. Dumb or smart, if no money arrives into the city coffers, similar to your personal bank account, you cannot pay out when the money does not arrive. Not one cent should have been expended by the City of Yonkers on behalf of the Yonkers Board of Education (YBoE) until allegedy promised grant money arrived to pay whatever was legitimately requested by the YBoE. Please recognize that the YBoE does not make payment to anyone for anything, instead, the City of Yonkers pays that which is requested of CoY on behalf of the YBoE. The point is that CoY should not have paid anything until the grant money was safely in the city’s coffers. That is the way it works in every operation throughout the world. If Yonkers prefers to engage in practices that are not prudent by any means. Mr. DeSantis the overseer of the City of Yonkers coffers should have been aware that any promissory note that goes unfunded may never materialize. The takeaway is quite simple. Mr. DeSantis, with the support of others took a chance on continuing to pay out on an unknown source and the the Yonkers City Taxpayer was left footing a $40 million debt that they never saw coming. That is the gist of my Hezitorial which questions the integrity of intent to renew a contract of an auditor who failed to serve the interests of the Yonkers taxpayer. Is there another reason for his contract to be renewed? If there is, I should like to know what the rationale would be. Kindly, Hezi

      1. There is no valid reason for the contract to be renewed. I was sickened tonight listening to the council members congratulating this firm on its responsiveness. They are being paid with my hard earned tax dollars to be responsive! I’d like to know how competitive the contract really is? And all politics aside, after 20 plus years with the same audit firm/ budget advisor…it’s time for a change.

        1. Totally agree!!!

          How much does this contract cost? It’s a five year contract? Why is that?

          The accounting firm relationship should be reviewed annually by City Council and the engagement contract evaluated for renewal.

          Every 5 years, there should be a mandated change in firm accompanied by a robust RFP process. This will preserve independence and objectivity.

      2. One thing was clear, that council members felt that they needed the auditor to navigate the “dense” budget, I am concerned that they lean too much on this vendor to even comprehend the data.

    2. What’s wrong with the article? Seems to raise some valid concerns regarding auditor independence and the need for rotation. What are the falsehoods that some City Council members were complaining about?

    1. Denial is a self-serving dismissive tool. The logic for change to serve the public interest is prudent and cost effective. It is also recognized as best practice and DeSantis’ 35 year legacy on the Yonkers political and financial stage has proven wanting. The most egregious of his lacking oversight is not recognizing the $55 million shortfall that was uncovered one-and-a-half years after funds were expected yet never arrived. That became a $40 million shortfall that also had to be bonded and thereby cost Yonkers in excess of $45 million all told. I expect a 7-0 vote approving renewing his contract. His gain, those of the Yonkers City Council, and Yonkers Taxpayer’s loss. _ Kindly, Hezi

      1. Oh Hezi, if only everyone was as smart as you. You have no idea how government works, what the schedule of grant payments are like. It can take years to receive the correct payment. At least we know where you get your marching orders from….

  3. Hey Dummies! The mayor is responsible for the city budget! It’s a strong mayor! DeSantis plays ball and knows where everything is hidden. Every mayor gets the lowdown realistic budget from DeSantis. DeSantis will stay!

    1. My understanding that at present, Shanae Williams, Corazon Pineda-Isaac, Michael Sabatino, John Rubbo, and Breen. I have yet to learn the position of Anthony Merante and Mike Khader. The “rehire” will be voted upon tomorrow, January 15th @ 7pm at the Yonkers City Council Meeting. – Kindly, Hezi

      1. Only City Council President Mike Khader voted against extending the contract. The 6 City Councilmembership voted to extend the contract with DeSantis’ firm. The vote is recorded in the video link posted at the top of the article. — Kindly, Hezi

  4. Perhaps Dr. Nader J. Sayegh can account for the money lost on his watch?

    BTW – PKF OCONNOR DAVIES with a $2,000.00 contribution to his campaign was one of his top 10 contributors.

  5. Khader might have written this himself. This guy is the true “master of disaster”. Guess what, no one will see this comment since Hezi is bought and paid for. Pretty cheaply I might add.

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