Nonprofit Local Development Corporations

Ever wonder what good local development corporations do?  You know there are a ton of these and to be honest, I've seen some produce pretty good outcomes.  But apparently, according to the New York attorney general, these "nonprofits" have great "potential for self-dealing, nepotism, improper loans and exorbitant expenses".

While this is New York, I wonder if this is just a New York situation.  And, when all is said and done, what role is does bad governance play?  See lot's of examples and the New York case, here.