ALBANY — A report from the state Senate’s Investigations and Government Operations Committee found New York’s sprawling system of quasi-governmental public authorities has approximately $282.1 billion in outstanding debt — an 8 percent increase since 2014.

The nine-month investigation released Monday, led by the committee's chairman, Democratic state Sen. James Skoufis, also found that New York’s reliance on public authorities was problematic due to a lack of laws that would allow state government bodies to scrutinize their financial and operational activities. Public authorities, which are primarily meant to stimulate economic development, are not subject to the same level of public scrutiny or transparency required of traditional state agencies.

“If there's one takeaway from our investigation, it's that taxpayers deserve far more accountability and responsibility with their money,” Skoufis said in a statement. “The results of this report acknowledge the important role that public authorities play in our state, but also pulls back the curtain on a system that's desperate for wholesale reform. Many of my colleagues and I will be heading into the forthcoming legislative session with a mission to advance substantial changes that better respect taxpayer pocketbooks.”

The state’s reliance on public authorities began in the 1930s under Robert Moses, who used them to build major transportation projects, and grew under a 1938 amendment allowing them to incur debt independent of the state. The use of authorities exploded during the tenure of Gov. Nelson Rockefeller from the late 1950s to early 1970s, according to the report.

Public authorities have become an “essential” vehicle to fund infrastructure improvements not approved in the state budget, the report says. Public authorities, which have the ability to issue bonds without voter approval, have issued over 96 percent of state-funded outstanding debt.

As of July 2019, there were 583 active public authorities, an increase of 298 since the state Authorities Budget Office, which was formed to regulate the entities, issued its first annual report in 2008. That includes 48 active state-level authorities. The Housing Trust Fund, which builds affordable housing, increased its spending by $2.8 billion since 2014, while the Metropolitan Transportation Authority increased spending by $993 million.

The report also found there were 109 active Industrial Development Agencies — which are established by the state at the request of a particular local government — and 294 Local Development Corporations, which are nonprofit corporations created by a county, city, town or village government.

Skoufis’ report specifically looked at alleged abuses in the cases of two public authorities, including in the Town of Montgomery, Orange County.

That case involved Medline, an Illinois-based company that's the largest private manufacturer and distributor of medical supplies in the United States. The firm submitted an application for a $17 million property tax break and $8 million in sales tax exemptions to build a new warehouse. The company also threatened to move jobs out of New York if it did not get a tax break from the Town of Montgomery Industrial Development Agency.

After Skoufis’ committee began investigating, Medline withdrew its application for the tax breaks from the IDA. Yet the warehouse project is moving forward anyway.

The IDA itself had no record of investigating whether the company’s threat to move jobs out of state was legitimate, the report found.

The investigation “revealed unethical, if not illegal, behavior and serves as an example of how financial incentives can be abused to the detriment of local taxpayers,” according to the report.

In its investigation, the committee issued information and document requests to 143 public authorities, including state authorities, local authorities, industrial development agencies, and local development corporations.

Skoufis urged the Legislature to enact a number of laws in response to the findings, including giving greater oversight authority to both the state comptroller's office as well as comptrollers on the county level; to increase the Authorities Budget Office's funding in order to ensure greater compliance with state laws; and to require public authorities to disclose on their websites all conflicts of interests.