White Plains CitizeNetReporter - Dormitory Authority Reports It Is Way in the Money.

WPCNR MYSTERIES OF ALBANY. Special to the CitizeNetReporter. December 24, 2004: The New York State Dormitory Authority has great news in its annual report. The state agency that foreclosed on St. Agnes Hospital in White Plains because the hospital had defaulted on its mortgage, is doing very nicely. The question is why didn't they want to save St. Agnes? The Dormitory Authority is doing very nicely indeed according to the following document:

A look at the introductory letter for the Dormitory Authority's 2004 Annual Report obtained by the White Plains CitizeNetReporter speaks for itself. Highlights of that report are in the covering letter written to the Governor by the Authority's Chairman, Gail Gordon, and its Executive Director Mayanne Gridley.

Here is the covering letter from the 2004 Annual Report of the state's bankroller:

Letter From Gail H. Gordon, Chair and Maryanne Gridley, Executive Director

Dear Governor Pataki and Distinguished Leaders:

We are pleased to present the 2004 Annual Report of the Dormitory Authority of the State of New York. This Annual Report highlights the activities of the Dormitory Authority as it finishes its 60th year of providing low-cost access to capital financing and a full range of construction project management services.

The Dormitory Authority served New York’s education and health-care institutions and other non-profit organizations by issuing $6.0 billion in bonds during the 2003-04 fiscal year, ending with an outstanding bond portfolio of $31.2 billion. Our Tax-Exempt Equipment Leasing Program, the largest in the nation, executed more than $151.0 million in leases for our customers’ equipment needs during the year, with an average savings of nearly $100,000 over commerical financing for every $1 million financed.

Construction expenditures for projects under Dormitory Authority management were $889.5 million in 2003-04, for new hospital, laboratory and high-technology projects, as well as academic buildings and thousands of new dormitory beds. As the fiscal year ended, we were continuing major modernization projects at New York City public hospitals, construction of several new dormitories for the State University and renovations to City University academic space. We were pouring the foundation for a new state-of-the-art DNA laboratory for New York City, erecting the steel framework at the Buffalo Life Sciences Center, and completing new and renovated court facilities. In total, we have more than 600 capital projects worth $4.95 billion in our construction pipeline.

During the fiscal year, the Authority completed work on two major management initiatives to help clients and the contractors who are our partners.

An integration project to allow our financial management system to share information with our construction project management system will improve and standardize reporting on a project’s progress. The integration permits data to be synchronized without cost-inefficient duplicate data entry. This integration means that all projects will benefit from more timely problem-solving, more consistent project reporting, and more readily available information for Dormitory Authority managers and our clients.

In addition, the Authority is implementing recommendations from an internal task force, which, after consulting with the General Building Contractors and the Northeastern Subcontractors Association, developed a new protocol to improve the review and payment for revisions in the scope of work.

Thanks to this collaboration, we are designing a system to track the progress of change orders and post the information on our Website. This system will expedite payment of the undisputed portions of a change order, authorize project managers to approve minor change orders, and require establishment of internal teams of employees to promptly close out projects and make final payments. These changes will make construction and contracting processes more efficient. Expedited payment of funds owed to contractors should increase competition for Dormitory Authority projects, with the resulting savings passed along to our customers.

The Dormitory Authority has been a proud participant in Governor Pataki’s continuing drive to diversify the State’s bond portfolio. As a means of lowering borrowing costs, variable rate bonds, subject to interest-rate exchange agreements (known as swaps), were issued in connection with the $1.5 billion refinancing of City University bonds and the $1.6 billion refinancing of the State’s mental hygiene facilities bonds. Additionally, $264.8 million in State University bonds, $41.9 million in State Department of Health bonds and $26.2 million in State Education Department bonds were sold to refinance higher rate bonds. These bond sales have provided major savings to the State of nearly $264.5 million on a present-value basis, resulting from reduced debt service costs. The release of reserve and other funds through refinancings and the achievement of more favorable interest rates also benefit taxpayers.

The Board and the staff of the Dormitory Authority remain dedicated to our mission and to the highest standards of corporate governance. We thank you, Governor Pataki, and members of the Legislature for your support, and we thank our employees for their dedication to serving the people of New York.

Very truly yours,

Gail H. Gordon, Chair

Maryanne Gridley, Executive Director

In our 60th year, the Authority:
• sold $6.03 billion in bonds, ending with a $31.2 billion portfolio
• sold $1.44 billion in bonds for new projects and $4.59 billion for refinancings
• saved customers $317.9 million through refinancings
• invested $889 million in construction projects, with a pipeline of $4.95 billion for projects in planning, design or construction
• leased $151 million in high-tech equipment at tax-exempt rates.


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