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Jan 29, 2009 11:14 AMPublication: The Southampton Press

$19 million in Southampton Town capital budget unaccounted for

Jan 29, 2009 11:14 AM

Some $19 million is unaccounted for in the Southampton Town $35 million capital funds budget, and while town officials scramble to resolve the discrepancy, some Town Board members are upset about not being informed about the miscalculation.

The revelation came to light during a routine discussion Friday regarding $1.1 million in proposed improvements to the Poxabogue Golf Course, a joint venture between the towns of Southampton and East Hampton.

In explaining the inconsistencies in the capital ledger brought up by Deputy Supervisor Richard Blowes, Southampton Town Supervisor Linda Kabot mentioned that the $35 million posted in the town’s capital accounts does not match the $16 million of actual cash the town has in the bank.

“That’s news to me,” Town Councilwoman Anna Throne-Holst replied. “How did that happen?”

Referring to the discrepancy in the budget, Ms. Kabot said Friday night, following the work session, that “Richard brought something up in open session that wasn’t on the agenda.” She added that some board members were upset that the capital figures were not “neat and tidy.”

What’s troublesome to Town Councilman Chris Nuzzi is that he was not informed about the budget’s inconsistencies until Friday’s work session focusing on the golf course improvements. “We hear about the discrepancies for the first time as an aside,” he said. “What’s alarming is that we’re just finding out about this while we’re being asked to allocate even more money.”

The incongruity in the capital budget precludes the Town Board from making any decisions on any future capital projects, Mr. Nuzzi said. “In light of the current economic circumstances, before we even contemplate spending additional dollars, we need to account for every capital project and every dollar spent, down to the penny,” he said.

Ms. Throne-Holst, who was skeptical about funding the Poxabogue project, said she could not make a decision on the golf course, or any other capital project, until she had a thorough accounting of the town’s entire capital picture.

“I need real numbers,” the councilwoman said, who added that she’s been asking for such a report for some time. “I’ve been kicking and screaming about this for almost six months now.”

The problem, in Mr. Nuzzi’s view, is that town officials do not have a bead on the status of the town’s capital projects. “Our priority should be to find out what projects have been funded, where they are, what’s left over, what’s been completed, what’s been scrapped,” he said.

But Ms. Kabot said the board did know about the trouble in the capital budget, just not the seriousness of it. The supervisor said she and Mr. Blowes are at work trying to get to the bottom of the numbers in order to present a more accurate picture to the board.

Mr. Blowes said he regrets bringing up a specific number and said the figure may or may not be $19 million. “I should have used general terms,” he said. However, Mr. Blowes acknowledged that the discrepancy was in the “significant millions.”

Ms. Kabot blamed “bad record-keeping” on the part of the previous town comptroller, Charlene Kagel, for the irregularity. “This has been a quandary for six years now,” Ms. Kabot said.

Mr. Nuzzi, however, pointed to a rough transition between Ms. Kagel and her successor as comptroller, Steve Brautigam, and said he suggested having both teams work together during the switch. “Apparently, that suggestion was never taken seriously,” Mr. Nuzzi said.

Ms. Kagel said the problem did not exist during her tenure and maintained that the dilemma over the capital funds stems directly from the poor transition. According to the former comptroller, Mr. Blowes presented a transition plan at a meeting in January 2008. “I voiced my opinion against that plan,” she said, adding that she was concerned about the fact that Mr. Blowes was not a comptroller. “It’s standard practice that the comptroller come up with a transition plan.”

Prior to becoming town comptroller for Southampton in 2003, Ms. Kagel served as deputy to former town comptroller Craig Furer.

“I was brought in as deputy comptroller in 2000,” she said. “And Craig had been there for 23 years. I had three years of knowledge before I became comptroller.” Ms. Kagel said that 26-year knowledge base was lost due to the absence of an adequate transition.

Mr. Blowes agreed that the transition was lacking, but cited the fact that Ms. Kagel took two of her staffers with her when she left to become Brookhaven Town’s finance commissioner. “There were very few people left who had been working in that department,” Mr. Blowes said. “But it’s irrelevant now. We are working through the process. Facts are facts, budgets are budgets, and records are records.”

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oh boy...here we go. unlike east hamptons, the best thing here would get the FBI involved and have all board members cease and desist in any further effort on behalf of the town. 19 million doesn't just go missing..oops. there are shennanigans being played here..not bad record keeping...nothing.

this is a disgrace and no amount of who dunnit, finger pointing or tap dancing around the facts will diminish the real amount of flagrant incompetance and mismanagement that is at play here. ...more
By hamptons surfer (79), southampton on Jan 24, 09 7:20 AM
Was there not an article where Kabot was calling for fiscal responsibility recently?

Did Kabot not just raise Taxes by the max allowed 5%?

She has known what has been happening in Town Hall since she was Vince's
gal friday, then as a Board member - now as Supervisor.

But hey, misplacing $19M is an honest mistake.......if you are an idiot like her.

Poor Linda - now called Kabot the Krook of Quogue. And Blowes is concerned
about Golf - nuff said.

So ...more
By G (342), Southampton on Jan 24, 09 9:09 AM
It is not secret that Kagel resigned because she did not have faith in Kabot's ability to manage the budget and did not want to risk her award-winning career as a financial expert.
Now Kabot ,for an entire year, misses $19 million and so she throws the town's former CPA under the bus.
When Kabot spent too much on staff, additions to the new court plus renovatons to town hall in 2008 that forced a hike in the 2009 budget, she blamed the former supervisor.
When Kabot got a slap on the ...more
By Hampton (50), Westhampton on Jan 24, 09 9:40 AM
Stop all future projects until this gets resolved. No more business as usual for Linda. I'm sure the report in April will conclude that the money is misssing and we still do not know why.
By Lefty46 (56), Westhampton on Jan 24, 09 10:49 AM
Holy Cow!!! We are going on about a couple of hundred thousand and letting go of good people on our appointed boards, and Kabot loses 19 million. We have seen major improvements to Keirnan's and Kabot's offices in town hall, a new faux slate roof, a 3.5 million dollar TEMPORARY courthouse and none of it went to any kind of public referendum. Why is our Town Supervisor denying that she is hiding anything from the board or the public….hmmm? Smacks of “I am not a crook”. It seems like now is a time ...more
By SHNative (554), Southampton on Jan 24, 09 10:58 AM
When will it end? Big deal offering early forced retirement to police officers in an "effort" to lower expenses! 19 million unaccounted for!!, they should all go to the same prison as Madoff!!
By Rayman (64), southampton on Jan 24, 09 1:47 PM
What a fiasco! Can we have a better illustration of the incompetent leading the ill prepared. Ms. Kabot immediately seeks to place blame elsewhere, while Mr. Nuzzi complains that he is only just learning about this 19 million dollar shortfall. Where has he been for the past three and one-half years? He was an integral part of the "creative" budgeting of the previous administration as well as the current one? The fall election can't come too soon.
By Viewpoint (26), Southampton on Jan 24, 09 4:08 PM
looks like bill and teds taxpayers adventure part two
By pinga (90), hamptonbays on Jan 24, 09 8:49 PM
Only a fool would believe a mistake or accounting error has occurred. The District Attorney and Attorney General should be consulted immediately.
By BM (10), Southampton on Jan 24, 09 9:21 PM
Fawn = Nice tender venison. Yum ! :-)
By PrivateerMatt (390), Weesuck Creek , EQ on Jan 25, 09 9:43 AM
What is the over under on when the Republicans in town hall start blaming Sally Pope for the missing $19 million. One week, two? After all, Ms. Pope has been in office for three weeks! How is that this came as a "surprise" to the board members. What have they been doing all this time??
By CommonSense (71), Southampton on Jan 25, 09 12:33 PM
Well as usual Kabot does not get it. Seems that I remember she proposed and passed about 100 resolutions when she was elected amending Heaneys' budget. So it was really her budget in 2008 when the mess started. But let’s get to the real heart of the matter. Richard Blowes is a control freak who has to be in on everything going on in the town. But everything he seems to touch costs the taxpayers more money. Hey I especially loved those roof tiles…..ordered arrived and not authorized……You know Richard ...more
By Hamptonman911 (14), Southampton on Jan 25, 09 12:52 PM

Because of the volatile nature of mortgage taxes, Southampton Town budgets conservatively by underestimating the amount of mortgage tax revenues it expects to collect in any given year, according to Southampton Town Management Services Administrator Richard Blowes. For instance, in 2007, Southampton took in $12.5 million in mortgage taxes, Mr. Blowes said, but budgeted for only $8.25 million.

“We’ve also been strict on spending outside ...more
By kpjc (161), east quogue on Jan 25, 09 2:12 PM
My comment a few spaces above was meant for a different article.My mistake.
By PrivateerMatt (390), Weesuck Creek , EQ on Jan 25, 09 2:33 PM
Who knew what . . . and when?

Let's see is it "Kabot - Nuzzi - Heaney"? Maybe it's "Heaney - Nuzzi - Kabot"? Could it be "Kabot - Heaney - Nuzzi"? Or does "Heaney - Kabot - Nuzzi" make more sense? When it comes to the missing 19 million does it really matter if all three are using the same (marked) deck?
By foodie (74), Remsenburg on Jan 25, 09 3:59 PM
How is it that the Town Council Representatives cannot get an accurate accounting of the Towns expenditures? Throne-Hulse had been asking Kabot for this information? If she can't get from Kabot how are the people suppose to get real numbers from the supervisor?
By SHNative (554), Southampton on Jan 26, 09 8:24 AM
When will people who we vote into office be accountable to us the public, if this is true what then?
Lets hope this is not the norm but things aren't looking good.
So lets wait and see
By shock (70), whb on Jan 26, 09 12:06 PM
Let me get this right....as soon as Kagel leaves, we're missing $19 million. Then we're told it will take 3 months to find it. Meanwhile, we're spending a mil on a golf course that appears to be fine as is? I think the Town should list all proposed projects on their website, then taxpayers can vote -majority wins. We don't have to wait for November; it can be done monthly. We should also do this for tracts of land purchased under Community Preservation funds. Has anyone seen some of the land ...more
By Ms. Jane Q. Public (147), Southampton on Jan 26, 09 1:20 PM
I have a feeling Mr. Harltey is onto something.
By hamptons surfer (79), southampton on Jan 27, 09 6:14 AM
Mr. blowes, with this current economy, spending money on a golf course in order to bring in more revenue is not wise when people are faced with the difficulty of making ends meet in order to survive. Have you seen the news lately? CUTBACKS, LAYOFFS, COMPANIES GOING OUT OF BUSINESS, ETC. Who will spend money in such a volatile environment?
Ms. Kabot, your efforts to save the town money trying to eliminate police officers jobs is a joke in light of this quandry you're in. $19 MILLION DOLLARS? ...more
By fdp (23), southampton on Jan 27, 09 6:48 AM
Let’s take a real look at this. Blowes wants to spend more money when he can't report what the town has in fund balance. Blowes do you know what a fund balance is? I doubt it. The real issue here is that Blowes is an egotistical maniac and he is out o his element. And in case he does not know it he is not the comptroller he is some guy who has his fingers in every single part of the town operation and throws a hissy fit when questioned about anything.

I think a case could be made against ...more
By Hamptonman911 (14), Southampton on Jan 27, 09 8:16 PM
It is disheartening to see that at the Town Board meeting Tuesday they authorized the comptroller to attend governmental accounting classes. Shouldnt the head of the towns finances, who earns six figures, already understand governmental accounting. Bring back Kagel!
By Hampton (50), Westhampton on Jan 29, 09 9:48 AM
Throw the rascals out! All of them!
By Frank Wheeler (1826), Northampton on Jan 29, 09 10:48 AM
Someday we will all see that the common demoninator in the politics of Southampton is Richard Blowes....he is the puppet master. Needless to say Charlene is a person with great integrity
By rabbit (65), watermill on Jan 29, 09 3:48 PM
When is the town board going to get the nerve to fire these guys? Once you find out Blowes is lying to you he has to go! Te other guy does not seem to be saying much so what is he there for…..can he even make a journal entry…who put the budget together this year….BLOWES and his staff
By Hamptonman911 (14), Southampton on Jan 29, 09 8:27 PM
Well i am happy to see that we are down to 250K missing. But once again I see well heard that Blowes misspoke, that’s the polite way of saying he lied right to the boards face. He was going to have numbers but then that’s not what he said, gee guys this is on tape. I just can't imagine that this guy is still here. Oh I know lets hire a deputy, no he has one of those, lets maybe add more people to his staff because you know he can get the job done with more people. This guy HAS TO GO. Is anyone ...more
By Hamptonman911 (14), Southampton on Feb 7, 09 7:48 AM