‘STATE OF New YorK
EXECUTIVE CHAMBER
‘Auanny 12224
DAVID A. PATERSON |
‘covennen
May 6, 2010
David W. Mortis, Esq.
Dear Chairman Morris:
The Authorities Budget Office (“ABO”), by letter dated May 1, 2010, has
recommended that I, as the appointing authority of the board of directors (the “Board”) of
the Now York State Theater Institute (*NYSTI"), suspend or dismiss the current Board.
This recommendation follows the release of the “Report of Investigation of the New i
York State Theatre Institute” by the State Inspector General (the “Inspector General's
report”), and the ABO’s review of information possessed by the Inspector General and
reports submitted by NYSTI management and staff.
As [indicated in my letter to the Board, dated April 26, 2010 (“April 26" letter”),
the Inspector General’s report calls into question the level of oversight exercised by the
Board over NYSTI officers and operations. The Inspector General found that the Board
permitted the Producing Director to exercise sole and final decision-making authority
over nearly every aspect of NYSTI’s activities, and that the Board was aware of and
approved the Producing Director's practice of hiring family members for NYSTI
productions. As a result, the Producing Director was able to use her authority to engage
in a pattern of activities from which she and members of her faznily benefitted, in
contravention of the Public Officers Law. In my view, these findings delineate the
Board’s clear failure to execute direct oversight of the authority's chief executive, and to
‘understand, review and monitor the implementation of fundamental financial and
‘management controls and operational decisions of the authority. According (o the ABO,
the documentation in support of the Inspector General’s report presents a convincing case
that the Board failed to meet these statutory obligations. The ABO concluded that the !
Board has demonstrated a persistent pattern of neglect in the performance of its duties |
and fiduciary obligations. Tagree.
Thave no confidence that the current Board can reverse this dysfunctional
organizational dynsmic. Indeed, in the time since I sent my April 26" letter, the Board
wy 90rThave no confidence that the current Board can reverse this dysfunctional
organizational dynamic. Indeod, in the time since I sent my April 26" letter, the Board
thas done nothing to reassure me that it has an adequate grasp of the corruption at NYSTI
during the past several years and is willing to act accordingly. 1 am disappointed that the
Board’s response to the Inspector General’s report and my April 26" letter was simply to
grant the Producing Director's request for unpaid leave. In my view, the Board should
have made a definitive statement of its disapproval with the actions of the Producing
Director by taking steps to remove her and restore the public trust in NYSTI. Such action
‘would have indicated an understanding by the Board of the magnitude of the problem at
NYSTI, and its resolve to undertake anew its fiduciary responsibilities. Instead, land the
citizens of this State are left wondering why the State should provide public monies to
support a corporation guided by a Board that appears incapable of discharging even its
‘most basic statutory power. Indeed, my Executive Budget proposal to defund NYSTI is,
particularly appropriate and sensible in light of this situation.
Jhave concluded that the Board as currently constituted should not and cannot be
entrusted to oversee NYST1's chief executive and to guarantee the effective and ethical
‘management of this public benefit corporation, Lam therefore constrained to call for
your immediate resignation from your position on the Board. If your resignation is not
forthcoming, [will take action to accomplish your removal. I look forward to your
prompt response. Any decisions by the current Board from this point forward will be
considered mull and void.
Very Truly Yours,
Send A. fretentotu
David A. Paterson