The New York City Parks and Recreation Department could have attracted an additional $8.8 million in revenue in the last three fiscal years through better management of its retail, recreational and dining concessions, according to an audit released Monday by John C. Liu, the city comptroller, according to an article in the New York Times.
The audit found that the parks department forfeited $6.9 million in revenue in the 2008, 2009 and 2010 fiscal years by failing to solicit bids and award licenses in a timely fashion, and $1.9 million for rejecting bids without maintaining the required documentation.
The audit singled out the handling of the Tavern on the Green concession in Central Park as a missed opportunity, saying that the city had foregone $2.2 million in concession fees and that the city and state had lost $3.7 million in sales tax revenue because of a gap in operations at the site, which had once been a famed restaurant.
The restaurant closed on Jan. 1, 2010, after its former operator went bankrupt. The city awarded a license to a new operator, but the deal fell apart after that operator failed to reach an agreement with the union representing Tavern employees. The site has since reopened, on a temporary basis, as a combination visitor center, food court and retail store.
The department, in its response to the audit, disagreed strongly with its conclusions, calling them “misleading and unfounded.”
The report shows “a serious lack of understanding of the required elements of the concession award process, particularly regarding the need for a determination that a prospective concessionaire will be a responsible business partner, with the integrity and financial wherewithal to serve the public, and meet its financial obligations,” Robert L. Garafola, the parks department’s deputy commissioner for management and budget, wrote in his response.
The parks department manages more than 400 concessions, which bring in more than half of the department’s revenue. In fiscal years 2008, 2009, and 2010, the department reported revenues from concessions of $52.6 million, $46.1 million and $39.8 million, respectively.