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WCB Delays Too Long

Comptroller Declines to Explain Delay in Providing Copy of $88 Million WCB Contract:



The Office of the New York State Comptroller declined Wednesday to explain why it has delayed for more than three months a Freedom of Information request for a copy of an $88 million contract between the state Workers’ Compensation Board and a vendor from Dallas, Texas.


An explanation is legally required and overdue, according to Robert Freeman, executive director of the Committee on Open Government in Albany and co-author of the state’s Freedom of Information Law.


In its request filed on April 28, WorkCompCentral sought electronic copies of a total of four WCB contracts and listed each one's contract number for easy identification, including the one for $88 million.


"A delay has to be reasonable and based on facts and circumstances," Freeman said Wednesday. "How difficult is it for the state comptroller to locate a contract after a contract number has been provided? It should be very simple. There may be no valid reason for the delay."


After acknowledging the request in a May 5 letter, the comptroller’s office followed up with a June 3 letter promising to "write to you no later than 8/27/2014 and inform you of any cost associated with producing or photocopying any available records."


Neither letter gave an explanation for the delay, an omission that Freeman called a violation of the law.


The WCB awarded the contract to scan its documents on Jan. 1, 2005, to SourceHOV, which was formerly known as SourceCorp BPS Inc. The company had provided the services continuously until earlier this year.


On April 18, the WCB announced in a bulletin on its website that it was switching to a new scanning vendor, Xerox.


"The projected target date for this transition is June 1, 2014, with all board document processing becoming fully operational with Xerox by July of 2014," wrote WCB Chairman Robert E. Beloten.


The bulletin had cited "delays and difficulties in the document scanning process." But it did not mention SourceHOV by name or that it had paid the company nearly $80 million, not including $8.1 million still due under a contract extension through Dec. 31, which the WCB awarded March 14.


Rachel McEneny, a spokeswoman for the board, did not respond to phone and email questions about whether the transition to Xerox had been completed as scheduled and, if so, why the contract with SourceCorp. continued until the end of the year.


In April, McEneny said the WCB had intended to end its relationship with SourceHOV last November, when it entered into a new service contract that included Xerox as its new scanning subcontractor.


Less than two weeks before the WCB publicly announced its switch to Xerox and acknowledged difficulties with its scanning process, the state comptroller, Tom DiNapoli, had blamed SourceHOV for botching its job handling 2013 state tax returns using paper forms.


DiNapoli’s auditors found errors on 22% of returns processed by the Dallas company, an error rate 40 times the performance standard in its three-year, $16-million contract with the Department of Tax and Finance.


SourceHOV conducted its scanning operations for the WCB in Binghamton, New York, which falls in the district of Sen. Tom Libous, the No. 2 Republican official in the state Senate.


The company was a long-time contributor to Libous' political campaigns, making its first gift the summer before it landed its big contract. Over the next few years, SourceHOV made at least 16 other contributions to Libous totaling at least $17,875.


Libous’ wife, Frances M. Libous, is vice chairwoman of the WCB. She was appointed to the board by former Gov. George Pataki, a Republican.


When her third term expired last December, Gov. Andrew Cuomo, a Democrat, appointed her to assume the four-year balance of a term held by former commissioner Mona Barnesi. Earlier in the year, Cuomo had flown to Binghamton to attend the wedding of the Libous’ son, Matthew Libous.


Cuomo has often publicly expressed his deep appreciation for Sen. Libous, who has been diagnosed with cancer but is running for reelection in November.


"He is one of the really special human beings in the state Legislature," Cuomo said of Libous in June. "And he’s been a great mentor and friend to me."


But barely a week after Cuomo made those generous public remarks, Preet Bharara, the U.S. Attorney for the Southern District of New York, indicted both Tom and Matthew Libous.


Bharara charged that Tom Libous had lied to the FBI in 2010 about a job he allegedly arranged for Matthew Libous at a suburban New York law firm − based on evidence prosecutors had obtained years earlier.


Matthew Libous was indicted separately on tax-related charges. Both father and son have pleaded not guilty.


Bharara’s charges against the Libouses came in the midst of a public feud between Bharara and Cuomo, which was triggered in late March when the governor shut down his own anti-corruption Moreland Commission.


In May, Bharara took over investigations of more than a half-dozen state legislators that had been launched by the Moreland Commission.


Two months later, the New York Times published a major expose that detailed efforts by the Cuomo Administration to hamstring the Moreland Commission before he shut it down.


The Times’ report did not mention Libous or his son, and there is no indication either were under investigation by the Moreland Commission.


In response to The Times revelations, several former Moreland commissioners delivered prepared statements saying the governor had not interfered with their work.


Those statements prompted Bharara to write Cuomo a warning that if he sought support from the commissioners he was risking being investigated for witness tampering.


There is no public indication that the SourceHOV contracts with the WCB and the Department of Taxation and Finance have come under the scrutiny of the commission or Bharara.


Jane Hall, the comptroller’s records access officer who signed the letters of response to WorkCompCentral’s Freedom of Information request, was out of the office Wednesday.


A spokeswoman for the comptroller said she would attempt to find another official to explain the status of the information request. No official called back.

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