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Maragos: Lax Contract Enforcement & Unauthorized Service Procurement By Parks Cost County $430,989

LongIsland.com

Comptroller George Maragos released an audit of two license agreements between the Nassau County Dept. of Parks, Recreation and Museum and Dover Gourmet Corporation.

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The audit covered the period January 1, 2013 through May 31, 2015.

Photo by: Justine FG, via Free Images.

Mineola, NY - December 12, 2016 - Nassau County Comptroller George Maragos released an audit of two license agreements between the Nassau County Department of Parks, Recreation and Museum (“Parks Department”) and Dover Gourmet Corporation d/b/a Quick Snack/Carnival Ice Cream (“Dover”), which granted Dover exclusive rights to provide catering, vending and concession services at various county parks and recreation facilities (“Parks”). The audit, which covered the period January 1, 2013 through May 31, 2015, found that the Parks Department had failed to properly enforce these licensing agreements and procured unauthorized catering services costing the County $430,989 in revenues.

“The Parks Department’s informal relationship with Dover resulted in significant lost revenue opportunities,” said Comptroller George Maragos. “The Parks Department should now make every effort to recover the uncollected revenues and obtain legislature approvals for all unauthorized catering services received.”

The audit found that the Parks Department had failed to properly administer and supervise the licensing agreements costing the County $430,989 in revenues as follows:

  • $295,635 in contractually required, but incomplete Capital Improvements
  • $84,077 in license fee revenues deducted for unauthorized catering
  • $22,800 in late charges
  • $27,075 in underreported cash sales receipts
  • $1,402 in other

Most of the unrecovered revenues pertain to the capital improvements that were not completed by 2014 as required by the agreements. Consequently, under the terms of the agreements the value of the incomplete capital improvements is to be remitted to the County. The $84,077 license fees offset occurred in 2014, when Parks agreed to deduct this amount from fees due the County as payment for thirteen County sponsored events. Although Parks obtained approval for these offsets from the County Attorney after the fact, the offsets circumvented the County Procurement and Payment processes.  

The above fees, and late charges should have been assessed by Parks notwithstanding their response that “…reciprocal accommodations are made by the parties, and any attempt to unilaterally impose late fees would destroy the working relationship now enjoyed by the parties.”  All County contracts should be performed and supervised in a professional manner fully compliant with the County’s purchasing procedures.