oversight

Lower Manhattan Development Corporation's Administration of Community Development Block Grant, Disaster Assistance Funds, New York, New York

Published by the Department of Housing and Urban Development, Office of Inspector General on 2005-09-27.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

       AUDIT REPORT




Lower Manhattan Development Corporation
  Community Development Block Grant
       Disaster Assistance Fund
        New York, New York

            2005-NY-1008

          September 27, 2005


        OFFICE OF AUDIT
     New York/New Jersey Region
                                                                 Issue Date
                                                                  September 27, 2005
                                                                 Audit Report Number
                                                                    2005-NY-1008




TO:        Nelson R. Bregon, General Deputy Assistant Secretary for Community Planning
                               and Development, D


FROM:      Edgar Moore, Regional Inspector General for Audit, 2AGA

SUBJECT: Lower Manhattan Development Corporation, New York, New York,
         Community Development Block Grant Disaster Assistance Funds


                                  HIGHLIGHTS

 What We Audited and Why

            Pursuant to a congressional mandate, we performed the fifth of our ongoing audits
            of the Lower Manhattan Development Corporation’s (the auditee) administration
            of the Community Development Block Grant (Block Grant) Disaster Assistance
            funds provided to the State of New York following the September 11, 2001,
            terrorist attacks on the World Trade Center in New York City. The U.S.
            Department of Housing and Urban Development (HUD) has allocated $2.783
            billion in Disaster Assistance funds to the auditee, and during our audit period of
            October 1, 2004, through March 31, 2005, the auditee disbursed $47 million of
            these funds for activities related to the rebuilding of lower Manhattan.

            Our audit objectives were to determine whether the auditee (1) disbursed Disaster
            Assistance funds in accordance with HUD-approved action plans, (2) expended
            Disaster Assistance funds for eligible planning and administrative expenses in
            accordance with applicable laws and regulations, (3) maintained a financial
            management system that adequately safeguarded Disaster Assistance funds, and
            (4) developed and implemented procedures to recover funds owed to the
            Residential Grant Program.
What We Found
           We found that the auditee generally disbursed Disaster Assistance funds in
           accordance with the HUD-approved action plans. The auditee also expended
           Disaster Assistance funds for eligible planning and administrative expenses in
           accordance with applicable laws and regulations, and maintained a financial
           management system that adequately safeguarded the funds. However, the auditee
           disbursed $2,028,282 in Disaster Assistance funds for items either not included in
           the budget of the subrecipient agreement for the Hudson River Park
           Improvements Program, or for costs incurred before the time of performance
           specified in the agreement. Additionally, the auditee developed and implemented
           collection procedures to recover funds owed to the Residential Grant Program.
           However, its collection efforts were not always fully documented, and there is a
           need to consider additional actions to recover amounts owed.

What We Recommend
           We recommend that HUD’s general deputy assistant secretary for community
           planning and development require the auditee to reimburse the $2,028,282
           disbursed for expenses either not included in the budget of the subrecipeint
           agreement for the Hudson River Park Improvements Program, or for costs
           incurred before the time of performance specified in the agreement. This
           reimbursement should be from nonfederal funds so that the funds can be put to
           better use. We also recommend that the auditee maintain complete
           documentation of its efforts to collect amounts owed to the Residential Grant
           Program and consider additional actions to address the collection of the $6.4
           million owed to the Residential Grant Program as of March 31, 2005.

           For each recommendation without a management decision, please respond and
           provide status reports in accordance with HUD Handbook 2000.06, REV-3.
           Please furnish us copies of any correspondence or directives issued because of the
           audit.

Auditee’s Response
           Auditee officials generally agreed with our findings, and noted that action has
           been taken to address the issues raised. Specifically, the auditee advised that it
           obtained additional invoices for costs that conform to the subrecipient agreement
           under the Hudson River Park Improvement Program to substitute for the costs
           found not to conform to the agreement. The auditee is also considering additional
           procedures to collect funds owed to the Residential Grant Program. We discussed
           the contents of the report with the auditee during the audit and at an exit
           conference on September 14, 2005, and they provided written comments on
           September 21, 2005.

           The complete text of the auditee’s comments can be found in Appendix B.



                                            2
                            TABLE OF CONTENTS

Background and Objectives                                                           4

Results of Audit
      Finding 1 Disaster Assistance Funds Were Disbursed Contrary to the Terms of
                the Subrecipient Agreement for the Hudson River Park Improvements
                Program
                                                                                    6
      Finding 2 Residential Grant Program Collection Efforts Need to be Fully
                Documented and Additional Actions Should Be Considered              8

Scope and Methodology                                                               11

Internal Controls                                                                   12
Followup on Prior Audits                                                            14
Appendixes
   A. Schedule of Questioned Costs and Funds to Be Put to Better Use                15
   B. Auditee Comments and OIG’s Evaluation                                         16
   C. Schedule of Program Funding and Disbursements as of March 31, 2005            20




                                             3
                         BACKGROUND AND OBJECTIVES

The September 11, 2001, terrorist attacks on the World Trade Center in lower Manhattan took a
devastating toll on New York City. Negative impacts were immediately felt in both the housing
market and the quality-of-life in lower Manhattan. The development of programs with significant
incentives, encouraging individuals to remain in or move to housing in lower Manhattan, as well
as improving the living conditions in lower Manhattan, was greatly needed. In the aftermath of
the terrorist attacks, Congress authorized the U.S. Department of Housing and Urban
Development (HUD) to provide the State of New York with $3.483 billion in Community
Development Block Grant (Block Grant) Disaster Assistance. On November 5, 2001, the Office
of Management and Budget designated $700 million in Block Grant funding for New York City
out of the Emergency Response Fund that Congress had appropriated. 1 On January 10, 2002,
Congress appropriated an additional $2 billion for Block Grant funding, earmarking at least $500
million to compensate small businesses, nonprofit organizations, and individuals for their
economic losses. 2 On August 2, 2002, Congress appropriated an additional $783 million in
Block Grant funding. 3

The Lower Manhattan Development Corporation (auditee) was created in December 2001 as a
subsidiary of the Empire State Development Corporation to function as a joint city-state
development corporation. The auditee was designated by the State of New York to develop
programs and distribute $2.783 billion of the $3.483 billion appropriated by Congress in the
January and August 2002 Emergency Supplemental Acts. The Empire State Development
Corporation, the parent company of the auditee, administers the remaining $700 million.

A 16-member board of directors, appointed equally by the governor of New York and the mayor
of New York City, manages the affairs of the auditee. The Auditee’s chairman of the board is
Mr. John C. Whitehead, and its president is Mr. Stefan Pryor. The Empire State Development
Corporation performs all accounting functions for the auditee, including payroll, payments to the
auditee’s vendors, and drawing down funds from HUD.

As of March 31, 2005, HUD had approved 10 partial action plans for the auditee, which
allocated approximately $1.9 billion, or 68.7 percent, of the $2.783 billion appropriated (See
appendix C for programs and amounts). As of March 31, 2005, the auditee had disbursed $877
million, or 46 percent, of the $1.9 billion allocated.

1
 2001 Emergency Supplemental Appropriations Act for Recovery from and Response to Terrorist Attacks on the
United States, Pub. L. 107-38, 115 Stat. 220 (2001).
2
 The Department of Defense and Emergency Supplemental Appropriations for Recovery from and Response to
Terrorist Attacks on the United States Act 2002 (Emergency Supplemental Act 2002), Pub. L. 107-117, 115 Stat.
2336 (2002).
3
 The 2002 Supplemental Appropriations Act for Recovery from and Response to Terrorist Attacks on the United
States, Pub. L. 107-206.




                                                       4
For the audit period of October 1, 2004, through March 31, 2005, we reviewed disbursements
related to the following: (1) the World Trade Center Memorial and Cultural Program; (2) the
Hudson River Park Improvements Program; (3) the Lower Manhattan Tourism Program, and
(4) the auditee’s planning and administrative expenses. In addition, we reviewed the auditee’s
efforts to collect amounts owed to the Residential Grant Program, as well as funds disbursed for
planning and administrative expenses related to the Utility Restoration and Infrastructure
Rebuilding Program.

For the items tested, our review disclosed expenditure exceptions under the Hudson River Park
Improvements Program and in the auditee’s documentation of collection efforts taken to recover
funds owed to the Residential Grant Program.

Hudson River Park Improvements Program

Under Partial Action Plan No. 4, approved by HUD on August 6, 2003, the auditee proposed to
provide up to $2.6 million for improvements to Hudson River Park. The improvements include
creating a set of new tennis courts and converting the courtyard of the Pier 40 complex at
Houston Street into recreational field space for use as baseball and soccer fields. The auditee
believes that the creation of these public recreational facilities will improve the quality of life in
lower Manhattan, making it a more desirable place to live, which will not only help retain
existing residents, but also attract more residents and visitors to the area. The auditee executed a
subrecipient agreement appointing the Hudson River Park Trust as the administrator of the
program. Funds for this program come from the initial $2 billion appropriation Congress
authorized on January 10, 2002, under the Defense Appropriations Act of 2002, Public Law 107-
117.

Residential Grant Program

On June 7, 2002, HUD approved Partial Action Plan No. 1, which allocated $280,500,000 to the
Residential Grant Program. This program seeks to compensate individuals for the extraordinary
expenses they may have incurred as a result of the disaster, as well as create incentives for
individuals and families to rent, purchase, or remain in housing in lower Manhattan. We audited
the Residential Grant Program in two of our prior audits. The auditee established a master
repayment list to monitor funds owed the Residential Grant Program due to processing errors
and/or recipients that broke the grant commitment to reside at an eligible address for two years.

Our audit objectives were to determine whether the auditee (1) disbursed Disaster Assistance
funds in accordance with HUD-approved action plans, (2) expended Disaster Assistance funds
for eligible planning and administrative expenses in accordance with applicable laws and
regulations, (3) maintained a financial management system that adequately safeguarded Disaster
Assistance funds, and (4) developed and implemented procedures to recover funds owed to the
Residential Grant Program.




                                                  5
                                     RESULTS OF AUDIT

     Finding 1: Disaster Assistance Funds Were Disbursed Contrary to the Terms of
                    the Subrecipient Agreement for the Hudson River Park Improvements
                    Program

     Our review disclosed that the auditee disbursed Disaster Assistance funds for costs that did not
     conform to the subrecipient agreement for the Hudson River Park Improvements Program. It
     allowed Disaster Assistance funds to be disbursed for (a) items not included in the budget of the
     subrecipient agreement and (b) costs incurred before the time of performance date specified in
     the subrecipient agreement. These deficiencies occurred because the auditee did not ensure that
     the invoices submitted for payment complied with the subrecipient agreement. As a result,
     $2,028,282 was disbursed for items either not included in the budget of the subrecipeint
     agreement for the Hudson River Park Improvements Program, or for costs incurred before the
     time of performance specified in the subrecipient agreement. Consequently, the auditee should
     be required to reimburse the $2,028,282 disbursed so that these funds can be put to better use.


Funds Disbursed for Costs Not
Approved in the Subrecipient
Agreement
            The auditee disbursed $734,651 for costs that were not initially approved as budgeted
            items under the subrecipient agreement related to the Hudson River Park Improvements
            Program. Section III of the subrecipient agreement, entitled “Budget,” provides that the
            auditee is to fund $2.6 million of the $6,652,506 overall program budget. The agreement
            allocated the $2.6 million between two activities: tennis courts (budget line item C
            4082), funded at $1,002,229 and Pier 40 general construction (budget line item C 4108),
            funded at $1,597,771. Section X, item D.2, of the subrecipient agreement, entitled
            “Subcontracts,” provides that the “Subrecipient shall not enter into any subcontracts with
            any agency or individual in the performance of this agreement without the written
            consent of Grantee [the auditee] prior to the execution of such subcontract agreement.”

            The subrecipient submitted and the auditee reimbursed four invoices totaling $670,078
            for work done by an electrical subcontractor under budget line item C 4110, which was
            not approved to be funded by the auditee under the subrecipient agreement. These
            invoices were dated between July and November 2004 and were paid in January 2005.
            We found no evidence that the auditee gave written consent to the subrecipient for the
            services of the electrical subcontractor. We also found that the auditee reimbursed the
            subrecipient $64,573 for granite materials purchased directly by the subrecipient from a
            supplier and invoiced to the auditee as a reimbursement to the general contractor.
            However, granite materials were not identified in the subrecipient agreement as being
            funded by the auditee.


                                                     6
Funds Disbursed for Services
Performed Before the Time of
Performance Specified in the
Subrecipient Agreement

             Section II of the subrecipient agreement, entitled “Time of Performance,” provides that
             services of the subrecipient are to start on August 1, 2004. Section IV, entitled
             “Payment,” provides that payment of eligible expenses shall be made against the line
             item budgets specified in section III (“Budget”) and in accordance with performance as
             specified in sections I and II (“Scope of Service” and “Time of Performance”). However,
             during our review of the supporting documentation for the invoices submitted by the
             subrecipient, we found four invoices totaling $1,293,631 for services performed before
             August 1, 2004, which were reimbursed by the auditee. Although these services were for
             tennis courts ($440,721) and Pier 40 general construction ($852,910), the costs were
             incurred before the time of performance specified in the subrecipient agreement;
             therefore, they should not be allowed.

  Recommendations


             We recommend that HUD’s general deputy assistant secretary for community planning
             and development require the auditee to

             1A. Reimburse from nonfederal sources the $2,028,282 disbursed under the Hudson
                 River Park Improvements Program so that these funds can be put to better use.

             1B. Review and enhance its control procedures to ensure that Disaster Assistance funds
                 are disbursed for only contracted items and costs incurred during the time of
                 performance specified in the subrecipient agreement.




                                                    7
Finding 2: Residential Grant Program Collection Efforts Need to be
           Fully Documented and Additional Actions Should Be
           Considered
The auditee developed and implemented procedures to recover funds owed to the Residential
Grant Program; however, its collection efforts were not always fully documented, and there is a
need to consider additional actions to recover amounts owed. To date, the auditee concentrated
on disbursing program funds to encourage individuals to maintain housing in lower Manhattan
rather than on collection activities. Consequently, the auditee needs to fully document its
collections efforts and consider additional actions to address recovery of the $6,441,103 owed by
Residential Grant Program recipients as of March 31, 2005, so that these funds can be put to
better use.


 Auditee Collection Procedures


              As of March 31, 2005, Residential Grant Program recipients owed $6,441,103 to
              the program. While some of the $6.4 million was due to erroneous payments,
              $6.1 million, or 95 percent, was the result of program recipients who broke the
              commitment made under the program regulations to reside in lower Manhattan for
              at least two years.

              The auditee tracks amounts owed to the Residential Grant Program through its
              master repayment list and has established procedures to recover funds owed. The
              program administrator for the Residential Grant Program sends a letter to
              recipients who have broken their commitment to reside at an eligible address for
              two years in accordance with the guidelines. The auditee sends an initial letter to
              recipients requesting repayment of funds owed 30 days after the program
              administrator’s letter. If no response is received, the auditee sends another letter
              60 days after the initial request for repayment. For those Residential Grant
              Program recipients who have been identified as owing funds due to errors, the
              auditee sends a letter requesting repayment, and if no response is received, the
              auditee sends another letter 60 days after the initial request for repayment. To
              date, additional collection procedures have not been established.

 Documentation of Collection
 Efforts Was Incomplete
              Our review and testing of grant recipients listed on the master repayment list as of
              March 31, 2005, found that the auditee properly accounted for funds repaid to the
              Residential Grant Program. We also found that the auditee maintained several
              files that track the date and type of letter sent, as well as the postal service
              certified letter number, if applicable. However, the auditee did not have
              complete documentation of the actions taken to collect all amounts owed to the



                                                8
            Residential Grant Program. Our review of 110 Residential Grant Program
            recipients to whom the auditee sent 30 or 60 day letters disclosed that the auditee
            did not document that letters were sent to 25 recipients. Auditee officials advised
            that letters were sent to the 25 recipients by its consultant that maintained the
            master repayment list. Nevertheless, to document a complete audit trail, all
            correspondence related to the auditee’s collection actions, should be maintained to
            facilitate review and audit by HUD as required by the alternative procedures
            published in the Federal Register.

Additional Collection Action
Needs to Be Considered


            The auditee’s collection procedures consist of sending 30 and 60 day letters,
            permitting an appeal process, and allowing amounts owed to be written off if
            certain conditions have been met. Through March 31, 2005, the auditee had
            granted appeals, reversed denials, collected, and/or written off $3,093,947 of
            amounts originally owed to the Residential Grant Program. Auditee records
            report that $6.4 million is currently owed the Residential Grant Program.
            However, to ensure collection of these funds, additional analysis of the balance
            should be initiated to determine the collection potential of the accounts and what
            if any alternative collection activity is needed.

            Our analysis of these accounts is presented in the chart below. Of the total 1,225
            accounts, 72 accounts owing $1,000 or less comprised less than half a percent of
            all amounts owed. In addition, 606 recipients, owing more than $5,000 but less
            than $12,000, accounted for 73 percent of all funds owed. Therefore, the auditee
            should analyze these accounts for collectibility and consider additional action to
            address the recovery of the $6,441,103 owed, so that any recovered funds can be
            put to better use.




                                             9
                                                  Residential Grant Program recipients with balances owed
                                                                                                               100%
                                   $7,000,000
                                                                                                              $6,441,103

                                   $6,000,000

                                                                                             73.35%
                                   $5,000,000                                               $4,724,795
            Amount of funds owed




                                   $4,000,000                                                                              Count

                                                                                                                  1,225
                                   $3,000,000

                                                                        26.21%
                                   $2,000,000                       $1,688,250                   606

                                   $1,000,000
                                                       .44%               547
                                                72 $28,058
                                          $0
                                                 < 1,000.00    1,000.00 -> 4,999.99   5,000.00 -> 12,000.00
                                                                           Range of balances




          Auditee officials stated that their efforts were concentrated on disbursing
          Residential Grant Program funds to individuals to encourage them to maintain
          housing in lower Manhattan. Further, the auditee stated that it is exploring the
          possibility of contracting with a collection agency or having in-house legal
          personnel pursue outstanding Residential Grant Program amounts owed. The
          auditee should consider these viable options.

Recommendations



          We recommend that HUD’s general deputy assistant secretary for community
          planning and development require the auditee to

          2A.                           Ensure that its efforts to collect amounts owed to the Residential Grant
                                        Program are fully documented.

          2B.                           Consider additional actions to address the collection of the $6,441,103
                                        owed to the Residential Grant Program so that these funds can be put to
                                        better use.




                                                                      10
          SCOPE AND METHODOLOGY

The auditee received $2.783 billion in Disaster Assistance Funds from HUD.
During our audit period, October 1, 2004, through March 31, 2005, the auditee
disbursed $47 million of these funds for activities related to the rebuilding of
lower Manhattan. We tested $24 million, representing approximately 51 percent
of the amount disbursed for the period.

To achieve our audit objectives we reviewed

•   Applicable laws, regulations, and program requirements;

•   HUD-approved partial action plans; and

•   The auditee’s accounting books and records.

We examined and tested the documentation supporting disbursements related to
the following programs:

     - World Trade Center Memorial and Cultural
     - Hudson River Park Improvements
     - Lower Manhattan Tourism

In addition, we reviewed the payroll records and timesheets of the auditee’s
subrecipient for the Utility Restoration and Infrastructure Rebuilding Program.
We also reviewed the Auditee’s procedures for recovering funds owed to
Residential Grant Program.

In review of the Hudson River Park Improvements Program, we tested 100
percent of the disbursements made for the period because the population was
relatively small and it was feasible for us to review each item in the population.
We used representative (nonstatistical) sampling to assess the auditee’s
procedures for recovering funds owed to the Residential Grant Program.

The audit covered the period from October 1, 2004, through March 31, 2005, and
was expanded when necessary. We performed our on-site work at the auditee’s
office, the office of program administrator for the Residential Grant Program, and
the office of the auditee’s parent company, the Empire State Development
Corporation, from April through August 2005.

We performed our review in accordance with generally accepted government
auditing standards.




                                 11
                             INTERNAL CONTROLS

Internal controls are an integral component of an organization’s management that provides
reasonable assurance that the following objectives are achieved:

   •   Effectiveness and efficiency of operations,
   •   Reliability of financial reporting, and
   •   Compliance with applicable laws and regulations.

Internal controls relate to management’s plans, methods, and procedures used to meet its
mission, goals, and objectives. Internal controls include the processes and procedures for
planning, organizing, directing, and controlling program operations. They include the systems
for measuring, reporting, and monitoring program performance.




 Relevant Internal Controls

              We determined the following internal controls were relevant to our audit objectives:

              •       Program operations - Policies and procedures that management has
                      implemented to reasonably ensure that a program meets its objectives.

              •       Compliance with laws and regulations - Policies and procedures that
                      management has implemented to reasonably ensure that resource use is
                      consistent with laws and regulations.

              •       Safeguarding resources - Policies and procedures that management has
                      implemented to reasonably ensure that resources are safeguarded against
                      waste, loss, and misuse.

              •       Validity and reliability of data - Policies and procedures that management
                      has implemented to reasonably ensure that valid and reliable data are
                      obtained, maintained, and fairly disclosed in reports.

              We assessed the relevant controls identified above.

              A weakness exists if management controls do not provide reasonable assurance that
              the process for planning, organizing, directing, and controlling program operations
              will meet the organization’s objectives.




                                               12
Weaknesses
             Based on our review, we believe that the following controls contain reportable
             weaknesses:

             •   Program operations –The Auditee’s collection efforts were not always fully
                 documented and additional actions to recover funds owed to the Residential
                 Grant Program need to be considered (see finding 2).

             •   Compliance with laws and regulations – Funds were disbursed for either items
                 not included in the budget of the subrecipient agreement for the Hudson River
                 Park Improvements Program, or for costs incurred before the time of
                 performance specified in the subrecipient agreement (see finding 1).




                                              13
                   FOLLOWUP ON PRIOR AUDITS


Prior Report Number and Date


           We issued Audit Report number 2005-NY-1003 on March 23, 2005. The report
           contained two audit findings with recommendations for corrective action. The
           findings involved deficiencies in the administrative costs related to the Utility
           Restoration and Infrastructure Rebuilding Program and lack of written
           documentation to ensure monitoring was performed. The auditee has implemented
           corrective actions to address our cited deficiencies, and the HUD Office of
           Community Planning and Development established September 30, 2005, as the
           target date for the Auditee to complete its corrective actions and for HUD to verify
           the corrective actions were taken.

           We issued Audit Report number 2004-NY-1004 on September 15, 2004. The report
           contained one audit finding with recommendations for corrective action. The
           finding involved deficiencies in the processing of businesses applications for grants
           under the Employment Training Assistance Program. The auditee has implemented
           corrective actions to address our cited deficiencies, and the HUD Office of
           Community Planning and Development has extended the established target date to
           September 30, 2005, to verify the corrective actions.




                                            14
                                    APPENDIXES


Appendix A
                    SCHEDULE OF QUESTIONED COSTS
                    AND FUNDS TO BE PUT TO BETTER USE

     Recommendation           Funds to be put
        number                to better use 1/
          1A                   $ 2,028,282
          2A                   $ 6,441,103
         Total                 $ 8,469,385


1/   “Funds to be put to better use” are quantifiable savings that are anticipated to occur if an
     Office of Inspector General (OIG) recommendation is implemented, resulting in reduced
     expenditures at a later time for the activities in question. This includes costs not incurred,
     deobligation of funds, withdrawal of interest, reductions in outlays, avoidance of
     unnecessary expenditures, loans and guarantees not made, and other savings.




                                                 15
Appendix B
         AUDITEE COMMENTS AND OIG’S EVALUATION


Ref to OIG Evaluation   Auditee Comments




                         16
Appendix B
         AUDITEE COMMENTS AND OIG’S EVALUATION


Ref to OIG Evaluation   Auditee Comments




Comment 1




Comment 2




                         17
Appendix B
         AUDITEE COMMENTS AND OIG’S EVALUATION


Ref to OIG Evaluation   Auditee Comments




Comment 3




Comment 4




                         18
Appendix B
         AUDITEE COMMENTS AND OIG’S EVALUATION


Comment 1   The auditee concurs with the finding. It has obtained additional invoices from the
            subrecipient for costs that conform to the subrecipient agreement under the
            Hudson River Park Improvement Program to substitute for the $2,028,282 in
            costs that did not conform. We recommend that HUD verify the eligibility of the
            substituted costs and ensure that the implemented procedures are operating as
            intended.

Comment 2   The auditee concurs with the recommendation and plans to conduct training that
            will emphasize ensuring that Disaster Assistance funds are disbursed only for
            eligible expenses within the scope of applicable agreements.

Comment 3   The auditee concurs with the finding.

Comment 4   The auditee has agreed to consider additional collection procedures, and will
            continue to implement the current collection procedures.




                                            19
Appendix C
         SCHEDULE OF PROGRAM FUNDING AND
         DISBURSEMENTS AS OF MARCH 31, 2005
                                                         Audit period
                                                        disbursements       Cumulative           Balance
                                     Budget as of      October 1, 2004 –   disbursed as of    remaining as of
              PROGRAM               March 31, 2005      March 31, 2005     March 31, 2005     March 31, 2005

       Residential Grant             $280,500,000        $11,828,197        $231,696,699       $48,803,301

       Employment Training
                                       500,000              38,643            265,452            234,548
       Assistance

       Memorial Design and
                                       350,000                0               299,969             50,031
       Installation

       Columbus Park Renovation        428,571                0                  0               428,571

       Marketing History/
                                      4,664,000            857,383           1,316,778          3,347,222
       Heritage Museums
       Downtown Alliance
                                      4,000,000           1,364,129          4,000,000              0
       Streetscape
       New York Stock Exchange
                                      10,160,000              0                  0              10,160,000
       Area Improvements
       Parks and Open Space           27,481,689              0                  0              27,481,689
       Hudson River Park
                                      2,600,000           2,466,968          2,466,968           133,032
       Improvements
       Millennium High School         3,007,500               0                  0              3,007,500
       West Street Pedestrian
                                      21,155,811          1,591,172          12,840,920         8,314,891
       Crossing
       Public Service Activities      7,296,900           1,512,258          1,771,044          5,525,856
       Lower Manhattan
       Community Outreach             1,000,000            330,060            540,760            459,240
       Green Roof Project              100,000                0                  0               100,000
       Chinatown Tourism and
       Marketing                      1,000,000            111,000            333,500            666,500
       Lower Manhattan
       Information                    2,570,000            921,072            921,072           1,648,928
                                                                     4
       Business Recovery Grant       224,500,000          -100,112           13,909,338         10,590,662
       Job Creation and Retention    150,000,000          3,133,000          53,710,020         96,289,980
       Small Firm Attraction
                                      50,000,000              0                  0              50,000,000
       Grant
       World Trade Center
                                     265,077,400          13,161,057        111,378,213        153,699,187
       Memorial and Cultural
       Lower Manhattan Tourism        3,450,000           1,642,835          1,880,447          1,569,553
       Disproportionate Loss of
                                      33,000,000              0              32,999,997             3
       Workforce
       Utility Restoration and
                                     735,000,000              0             160,313,178        574,686,822
       Infrastructure Rebuilding
       Administration and
                                      85,459,938          8,098,062          46,758,704         38,701,234
       Planning

                           TOTALS      1,913,301,809         $46,955,725       $877,403,059       $1,035,898,750




4
    Represents funds collected and returned to the program.
                                                             20