The city left an estimated $1.4 billion in fines linked to quality of life issues uncollected even as it remains in dire financial straits, according to an audit by the Department of Investigation. And some of those violators are businesses that have done business with the city even after they were hit with summonses.
In its 22-page report, the independent investigatory body said the fines include more than $782 million issued by the Environmental Control Board, the administrative court that presides over hearings involving alleged quality of life violations, which include uncleaned streets, illegal water disposal, illegal street vending, building code violations, illegal dumping, and health code violations. The other $635 million were fines that were written off, according to the DOI's report released on Thursday afternoon.
Margaret Garnett, the DOI commissioner, said the figure in uncollected fines could be even higher since the city's arcane tracking system is "riddled with problems making it difficult, if not impossible, to zero in on an exact figure of dollars lost to New York City."
The DOI blamed bureaucratic slowdowns in collecting fines, with Garnett concluding that the city "needs an effective and efficient collection system for its fines that govern our codes, rules, regulations, and quality-of-life laws. during these fiscal times." After a fine is issued by the ECB‚ which hears cases on summonses issued by the police, fire, parks, transportation, and health departments over a range of issues—enforcing the collection of the fines depends on the summons' fee.
If it's less than $25,000 it goes to the city Department of Finance. If it's more than that, it goes to the Law Department. There is also no central database shared by city agencies to determine unpaid fines.
The city routinely failed to check its records to determine if vendors who do business with the city had paid their fines, the DOI added. Investigators found 110 approved city vendors had unpaid fines.
The timing of the report's release comes as the city continues to grapple with a $9 billion financial hole that's been exacerbated by the coronavirus pandemic. It also comes the same day as Moody's Investor Services downgraded the city's credit rating from Aa1 to Aa2, which still gives them a high investment rating, according to the Wall Street Journal. Moody's has kept the city's outlook rating on "negative" and added it could remain so if it continues to seek borrowing authority from Albany.
In a statement, a spokesperson for City Hall said, “The City has increased collections by tens of millions of dollars over previous years, including doubling what was brought in over the previous five years. We are using every tool to collect revenues owed to the City, including improved data sharing to successfully locate those responsible for violations.”