Skip to content

Breaking News

State lawmakers open probe of troubled Connecticut Port Authority, focusing on reports of mismanagement of finances and operations

  • Wind power is among the clean-energy options Connecticut could consider.

    Ingram Publishing / Getty Images/Ingram Publishing

    Wind power is among the clean-energy options Connecticut could consider.

  • The U.S. Coast Guard Barque Eagle approaches City Pier in...

    SEAN D. ELLIOT/AP

    The U.S. Coast Guard Barque Eagle approaches City Pier in New London last month. State lawmakers on Tuesday opened an investigation into the troubled Connecticut Port Authority, which runs the Bridgeport, New Haven and New London ports.

of

Expand
Author
PUBLISHED: | UPDATED:

State lawmakers on Tuesday opened an investigation into the finances and operations of the troubled Connecticut Port Authority that was roiled this summer by two high-level resignations over financial improprieties.

A chairwoman resigned and a former chairman quit his seat on the board of directors at the small state agency that runs Connecticut’s three ports on Long Island Sound and is responsible for inland waterways. The decision to spend $3,000 for photographs taken by the daughter of the former chairwoman and displayed at the Port Authority’s Old Saybrook office was initially the stated reason for the leadership upheavals. But a review of the agency’s operations by state auditors found more significant problems.

“It was really a demonstration of a lack of ethics of certain board members that have created these issues, said Rep. Laura Devlin, R-Fairfield and ranking House Republican on the General Assembly’s transportation committee during a day-long hearing. “And also a misuse of the authority’s resources.”

The Auditors of Public Accounts reported in May that during the state’s fiscal years ending June 30, 2016, and 2017, the Connecticut Port Authority did not adopt procedures for affirmative action, personnel practices, the use of surplus money and distribution of loans, grants and other financial assistance as required by law. In addition, auditors found that the agency opened bank accounts in March 2017, but did not maintain an accounting system for the accounts.

The Port Authority told auditors in its response that it hired an accounting firm in September of 2017 “to perform reconciliations and address its bank account control deficiencies” and retroactively entered accounting transactions, said John Rasimas, deputy state auditor.

Auditors received a complaint in May “related to mismanagement and misuse of funds,” he said. Auditors immediately began a 2018-19 audit, but he said he is not able to speak “to any definitive conclusions” of that audit.

When auditors asked for QuickBook accounting reports, the Port Authority said the records “may not be complete and may not be accurate,” Rasimas said. Receipts were missing for some transactions and the Port Authority had a “lack of sufficient documentation” for other transactions, he said.

The agency also failed to comply with reporting as required by law, specifically an annual comprehensive report on agency operations and quarterly financial and personnel status reports, Rasimas said.

The investigation and negative publicity are badly timed: The State Pier in New London announced in May a $93 million public-private partnership with a wind energy producer on a plan to expand and upgrade the pier. A joint venture of Orsted, a wind energy company based in Denmark, and Eversource, which has committed $225 million in a partnership with Orsted, struck the deal with the port authority and Gateway, the operator of the terminal at the State Pier.

David Kooris, acting chairman of the Connecticut Port Authority.
David Kooris, acting chairman of the Connecticut Port Authority.

Details of a long-awaited harbor development agreement outlining plans for construction at the State Pier will be announced Sept. 17, said David Kooris, acting chairman of the Port Authority. The State Pier is being redeveloped to accommodate the wind power industry to assemble and ship wind turbines headed to the Atlantic Ocean off Long Island and Massachusetts.

Responding to questioning by Devlin about the use of a no-bid consulting contracts, Kooris defended the use of consultants, saying the practice is allowed by policies and procedures adopted the board. Consultants regularly contracted with the Port Authority below the $50,000 threshold that would trigger a request for proposal, he said.

“Approved by the board, it was within their authority to do so without a procurement process,” he said.

Gov. Ned Lamont has taken tighter control of the Port Authority. He announced last month that Melissa McCaw, his budget director and secretary of the state Office of Policy Management, will oversee its finances.

He also directed Kooris to hire an independent firm to audit the authority’s financial and management practices.

Asked by Sen. Will Haskell, D-Wilton, if the troubles at the Port Authority are unusual for quasi-public agencies, Kooris said he has not seen “this level of policy ambiguity that has allowed what we have seen.”

“What we have uncovered and found in the records, much of what was suggested by this committee and the auditors, the controls, reaching out to other (quasi-public agencies) was done by the staff and was not ultimately implemented by the executive director and the staff,” he said.

Sen. Carlo Leone, D-Stamford and the committee’s Senate chairman, sounded a note of disappointment at the problems at the Port Authority, saying Connecticut had “high hopes” for its success in advancing the state’s maritime economy.

“My hope is that it’s still possible,” he said.

Stephen Singer can be reached at ssinger@courant.com.