Capital New York Councilman questions $4 billion in contract overruns by Azi Paybarah

Capital New York
Capital New York
Councilman questions $4 billion in contract overruns
Azi Paybarah
03/25/2014

Councilman Ben Kallos asked the city's Law Department today to help investigate what he estimates could be nearly “$4 billion in overspending, on $6 billion worth of contracts."

Kallos, chairman of the Government Operations Committee, made the request during a budget hearing this morning at City Hall, citing a 2012 law that required the City Council to be notified if contracts had significant cost overruns.

Kallos asked the city’s corporation counsel, Zachary Carter, who was testifying about his own department’s budget needs, if the city's attorneys would help review the 113 contracts in question and possibly recover some of that $4 billion.

“Obviously, we’d have to review those contracts on a case-by-case basis to determine whether the overcharges are an issue of fraud…[or] competence,” or some other factor, Carter replied.

After the hearing, Kallos told Capital the original sum for the 113 contracts was $6,137,601,730.66. Those contracts are now “approaching their maximum contracting amount of $10,104,827,333.92.” (The difference is $3,967,225,603.26.)

Among the contracts flagged under the 2012 law, and noted by Kallos, was with the Department of Parks and Recreation for improvements to the piers, promenade and surrounding the Brooklyn Bridge Park area. It rose from $13 million to about $93 million.

Another contract, with the Department of Environmental Planning, was to help address pollution at Newtown Creek. It was slated for nearly $71 million. The last payouts made for the project showed costs jumped to nearly $178 million.

Issue: 
Good Government