SUNY blamed for improper consultant hiring

ALBANY -- New York's top auditor has rapped the State University of New York's chancellor, saying she improperly hired a consultant to review the system's relationship with the SUNY Research Foundation.

In a letter to Chancellor Nancy Zimpher, the first deputy comptroller, Pete Grannis, said the comptroller's office was stripping SUNY of the privilege of speedy approval for spending requests because of a $270,000 report Zimpher commissioned after she took control in 2009.

Grannis said the contract for the report was inappropriately given to the law firm of Hogan Lovells, which already had a SUNY contract to provide legal services on health-related matters. To extend the assignment to looking into SUNY's relationship with the Research Foundation was wrong, Grannis said.

As a result, SUNY central administration's eligibility for "Quick Pay" voucher payments has been pulled.

In a statement, Comptroller Thomas DiNapoli said procurement laws exist to make sure taxpayers get the most for their money.

"SUNY circumvented those laws at the same time it was lobbying for greater procurement flexibility," he said. "My office will put SUNY's future payment requests under an even sharper microscope to make sure this doesn't happen again."

He applauded the work of Hogan Lovells, which found numerous problems with the operations of the Research Foundation, which manages revenue of about $1 billion a year, mostly from research grants, and a payroll of 17,000.

The operations of the foundation are being investigated by the state inspector general's office, and DiNapoli's fraud team is auditing.

SUNY spokesman Morgan Hook said the assignment of the law firm to work on foundation relations fit naturally into the existing contract with Hogan Lovells because so much of foundation business involves the SUNY medical campuses. Hook said vendors of SUNY central administration will be the ones to suffer the most from what he termed the comptroller's "additional red tape."