County may fight to regain funds

JOHNSTOWN – Fulton County may spend up to $40,000 in an effort to recoup about $3 million in bonuses that two former economic development officials paid themselves.

The Fulton County Board of Supervisors on Monday will consider allocating the funding to help the Fulton County Center for Regional Growth legally pursue the money.

The resolution – sponsored by the board’s Economic Development and Environment Committee – calls for the appropriation of funds to the CRG for attorney’s fees and forensic accounting services to “pursue recovery of monies taken by former EDC/CIC executives.”

The CRG has been pursuing legal action over the past few years to recover the money.

The CRG – parent company of the Fulton County Economic Development Corp. and the Crossroads Incubator Corp. – and the county late last year formed a new partnership designed to erase negativity from the agency’s 2010 scandal.

Federal income tax returns showed former EDC Senior Vice President Jeff Bray and former CIC Executive Vice President Peter A. Sciocchetti received $3 million in bonuses that their boards of directors later said were not approved.

The Board of Supervisors will consider the proposed resolution at 1 p.m. Monday at the County Office Building.

In explaining the proposed resolution, Board of Supervisors Chairman William Waldron said today the CRG may not be financially capable at this point of continuing litigation against Bray and Sciocchetti without some financial help from the county.

“There are [county supervisors] who feel as though the EDC and CIC may not be able to pursue recouping money,” Waldron said. “Some people don’t want to see the cases dropped.”

Waldron said the resolution calls for allocating up to $40,000.

Gloversville 3rd Ward Supervisor Michael F. Gendron, chairman of the Economic Development and Environment Committee, said today he had no comment because the matter involves “pending litigation.”

CRG President and Chief Executive Officer Michael Reese said Thursday he would have no comment until after the allocation is possibly approved by the county board Monday. He said he plans to attend Monday’s board meeting.

CRG board Chairman Dustin Swanger couldn’t be reached this morning for comment.

County and CRG officials met last October to announce a stronger partnership that involved more accountability and more funding.

Officials said the EDC and CIC were facing financial difficulties and would be dissolved. The county later increased its annual taxpayer allocation to the CRG from $25,000 to $75,000 for 2013.

The Board of Supervisors in November 2010 asked then-Attorney General Andrew Cuomo to investigate the bonuses.

Current Attorney General Eric Schneiderman in March 2012 concluded the investigation and took no action.

Michael Anich covers Johnstown and Fulton County news. He can be reached at