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Overwhelmingly Passed Again by Assembly, Bill to Close LLC Loophole Appears Iced by Senate


squadron podium

Sen. Daniel Squadron (photo: @DanielSquadron)


On Tuesday the state Assembly passed a bill to close the controversial LLC loophole at the center of the federal corruption cases against former Assembly Speaker Sheldon Silver and former Senate Majority Leader Dean Skelos. Both men - a Democrat and a Republican, respectively - were recently arrested and subsequently stepped down from their powerful leadership posts. Later in the evening Tuesday, the Senate’s version of the bill to close the loophole that allows money to flow unfettered into campaign accounts appeared to be dispatched by Senate Republicans in a bit of behind-the-scenes maneuvering.

The LLC loophole that allows individuals and corporations to donate unlimited amounts of cash to legislators has been treated by many as a political hot potato all year. It gained attention when Glenwood Management and its principle, Leonard Litwin, were connected to the Silver indictment. Litwin is the state’s largest campaign donor thanks to the many LLCs he controls and his tendency to donate large sums to politicians at all levels of state government and in both major parties. The issue flared up again after Litwin and his company appeared in the federal complaint against Skelos.

According to a study by Common Cause NY, Glenwood Management has given $12.8 million in political donations from 2005 to 2014, but only 10 percent of those donations actually came directly from Litwin or his companies. The rest of the donations were made by LLCs registered to Glenwood or listed at its address.

In April, Sen. Daniel Squadron, a New York City Democrat, used a parliamentary maneuver called “Motion for Committee Consideration” to force the Elections Committee to consider the bill. In an apparent move designed to avoid controversy, Republican Senators voted to move the bill out of committee without recommendation. Instead of being sent to the floor for a vote it was sent to the Corporations Committee. Squadron told Gotham Gazette at the time it appeared the Republcians had “used a loophole to kill an attempt to stop a loophole” because the Corporations Committee rarely meets.

The rules say that once a bill is referred to a committee it must be heard within that committee’s next two meetings, if they are held within the legislative session for which the bill is active.

Somewhat surprisingly, the Corporations Committee did indeed meet on Tuesday, only after the meeting had been rescheduled multiple times - its second meeting since the bill left the Elections Committee. The meeting was finally called to order in the evening after the day’s Senate session. Committees rarely, if ever, meet after session. In fact, Squadron said he couldn't recall a committee meeting being scheduled for after session during his seven years serving in the Senate.

The LLC bill was not on the committee's agenda despite Squadron’s insistence that Senate rules mandated it. Committee Chair Sen. Michael Ranzenhofer told Squadron that he had not received a letter requesting his bill be put on the agenda until just before the meeting.

Squadron said he indeed had notified the committee properly and that the request for consideration he filed with the Elections Committee should have ensured the bill was on the agenda. Republican counsel interpreted the rules differently saying that the motion did not mandate a vote in Corporations.

“I just got your letter. I haven't been able to digest your letter,” Ranzenhofer told Squadron. “Let me take look at it and decide whether it should be on the calendar.”

Squadron pressed Ranzenhofer on when the committee might meet next and if it is likely his bill would be on the agenda. “Actually, before this subject came up it was actually not my plan to have any more meetings,” Ranzenhofer responded and referenced the many bills that had already been considered during the meeting. With that the meeting was adjourned.

“Hope springs eternal,” Squadron told Gotham Gazette. “I have hope that the new leader will consider the importance of this measure,” Squadron said, noting that new Majority Leader John Flanagan had only been elected to replace Skelos the day before. Flanagan told reporters earlier in the day that he would discuss the loophole with his conference.

Barbara Bartoletti of The League of Women Voters said she wasn’t exactly surprised Squadron’s bill was not considered. “No one pays attention to committee meetings in the Senate,” she said, adding, “Most lobbyists don’t even show up because they are controlled by leadership.”

Consensus on ending the loophole has been elusive despite the headlines it has inspired.

Closing the loophole appeared to be part of budget negotiations, with Governor Andrew Cuomo saying publicly that he believes it should be closed, but it was absent from the final deal that was revealed to legislators minutes before they had to vote for it. It has been unclear if the governor, whose campaign accounts have benefited immensely from LLC contributions, has worked at all to move Senate Republicans toward closing the loophole.

In April, good government groups partnered with legislators to push the State Board of Elections to close the loophole that it had created through a 1996 ruling. The Board deadlocked 2-2, with both Republican appointees voting against a measure sponsored by the Democrats to consider limits on LLCs.

Also last month, the Senate Elections Committee referred Squadron’s bill to Corporations, where it appears it will die. There is no indication that the committee will meet again before legislative session ends in mid-June.

“They all benefit from this,” said Bartoletti of both houses of the Legislature and Governor Cuomo. “One of them will do something on it knowing the other will prevent real action.”

Assembly Member Brian Kavanagh, a New York City Democrat and sponsor of the Assembly bill to close the LLC loophole, acknowledged the fact that members of both political parties are beneficiaries in the status quo. “This is a non-partisan issue,” said Kavanagh. After his bill was passed by a whopping 120-8 vote in the Assembly, Kavanagh later issued a statement saying he hopes “The Senate will join us in enacting this, by passing Senator Daniel Squadron's companion bill."

In the news release celebrating the Assembly vote sent out by Speaker Carl Heastie’s office, Kavanagh is also quoted saying that "The LLC loophole is perhaps the most egregious weakness in our laws regulating money in politics. It has been the mechanism of choice for certain people to attempt to buy influence wholesale.”

For his part, Heastie stated, “Limits on political contributions exist for a reason...By treating LLCs the same way we treat corporations, we can create greater transparency and put an end to the use of multiple LLCs as a means of working around campaign finance laws.”

Good government groups issued a statement praising the bipartisan passage of the bill in the Assembly. “With the passage of A.6975-B, the Assembly has sent a strong bipartisan signal, and is taking an important step to uphold the public interest and rebuild confidence through the passage of one of many needed ethics reforms,” said the statement from a coalition of groups including The New York Public Interest Research Group, Common Cause, The Brennan Center, Reinvent Albany and Citizens Union. “We encourage the Senate to follow suit and let New Yorkers know they are serious about addressing the pervasive culture of corruption plaguing Albany.”

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by David King, Albany editor, Gotham Gazette
@DavidHowardKing 

John Flanagan's Senate Campaign Finance: The Full Picture


Flanagan via Senate website

John Flanagan (photo: Senate website)


John Flanagan, Republican state Senator, is now Temporary President and Majority Leader in Albany's upper chamber. He replaces Dean Skelos in leadership following the fellow Long Island senator's arrest on federal corruption charges. With a nod to upstate legislators, Flanagan retains Tom Libous as deputy leader, despite Libous himself being under federal indictment.
 
In his new, higher-profile, more powerful leadership role, Flanagan will be at the table with Governor Andrew Cuomo and Assembly Speaker Carl Heastie, both Democrats, as all major policy decisions are negotiated. With increased power comes increased scrutiny - just after being elected to lead the Senate, Flanagan was asked repeatedly by reporters on Monday if he is under federal investigation. He indicated he is not. As both Skelos and former Assembly Speaker Sheldon Silver were brought down by federal indictments related to financial matters, whether extortion, kickbacks, or other charges, the political finance network of John Flanagan is now more relevant than ever. While Flanagan last week quit his other job as a lawyer leading up to his Senate ascent, he has been in the Legislature for more than twenty years and has a long campaign finance record, both in terms of donations to his campaign accounts, and expenditures made by those accounts.
 
Here is a look at Flanagan's fundraising velocity across his career in the New York Senate, which he joined in 2003 after many years in the Assembly:
 
flanagan 1
 
Flanagan has raised $2,557,409.53 since 2000 (beginning in earnest with 2002, an election year). He had his biggest fundraising year in 2006. From 2002 through 2014, he collected an average of $196,362.27 in donations per year, in an average of 350 donor transactions.
 
Here are his top Individual donors (everyone who gave $5,000 and up, 2002-2014):
flanagan individual donors
His largest donor, Ronald Parr (whose business also appears on the next list, of corporate donors) describes his company as, "Headquartered in Ronkonkoma, New York, The Parr Organization has been a leading Long Island full service construction and development company for more than fifty years."
 
Burton Resnick is a real estate executive with Jack Resnick and Sons. Rod Brayman is President at Phoenix Beverages. Paula G. McInerney, Matthew Cody, Roger Hertog, and Bruce Kovner are all current or retired hedge fund managers.  
 
Sen. Flanagan's top Corporate donors (2002-2014):
flanagan corp
This list is almost entirely liquor- and beverage-related with a tiny touch of real estate and Up From The Ashes, Inc, which is associated with Rod Brayman (who is in beverages).
 
Between the use of multiple entities, and all the variations in how names are entered, identifying these relationships can be tricky. When special care is taken to review the diversely named enterprises of Leonard Litwin and Glenwood Management, $31,500 in accumulated contributions from these sources to Flanagan emerges. This means that while traditional methods implicate BOTTLEBARGAINS NORWOOD LIQUORS INC. as Flanagan's largest corporate donor, this honor apparently goes to Glenwood, instead. By comparison, Dean Skelos received over $110,000 from Litwin, while John DeFrancisco (across two committees) received $36,100.  
 
Sen. Flanagan's top Institutional donors (2002-2014):
flanagan institutional
Flanagan's chairmanship of the Education committee, at the very least, is apparent in the institutional donor list above. Otherwise, the major spenders in his world are the same as the rest of leadership, past and present. As senate leader, Flanagan will no longer chair the education committee, he has yet to name a successor.
 
Looking at Flanagan's campaign account expenditures show interesting data of how the senator has spend that money (again, 2002-2014):
flanagan expenditures
Like his Assembly counterpart, Democratic Speaker Carl Heastie, Flanagan appears quite comfortable putting massive expenditure on his American Express. At $115,025.96, that is where 4.49% of every dollar Flanagan raised actually went.  
 
Using information (unevenly supplied) in the memo column, it appears that most of this credit card money is spent on food and liquor, followed by gas and hotels. The rest of that lump sum is spent on late fees and interest payments to American Express.
 
Standing out from this list are Flanagan's campaign payments to Toyota Financial Services - presumably an auto loan - in the total amount of $32,817.90, so far. It would appear he is financing an automobile with campaign account funds. 
 
A common feature of leadership and putative leadership in each legislative chamber in Albany is being a net creditor to your party-conference organizations. While some tithes to parties are handled as expenditures, larger sums are often handled via Schedule H (transfers out). Here are nearly a dozen committees to which Flanagan transfered money (2002-2014):
flanagan transfers
The bulk of these transfers, to his party machine, were conducted in 2010 and 2014, while balance-of-power elections raged in his chamber. In 2006, the SRCC transferred $200,000 to Flanagan. He has since transferred $551,000 back. 

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by Jon Reznick for Gotham Gazette
Data analysis performed using FTMSQL2 by Competitive Advantage Research, LLC

The Flanagan Effect: What the New Senate Leader Means for the De Blasio Agenda


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New Republican Senate Majority Leader John Flanagan (photo via Facebook)


ALBANY - Republican John Flanagan assumed the mantle of Senate Majority Leader on Monday during an unprecedented time of upheaval in Albany, brought on by the arrests of both former Assembly Speaker Sheldon Silver and former Senate Majority Leader Dean Skelos on multiple federal corruption charges. Scandal unearthed by U.S. Attorney Preet Bharara has exposed the backroom dealings of the state's largest political donor and the men who control the flow of legislation. As he takes a new seat at the negotiating table, Flanagan faces a variety of challenges, including establishing himself as free of ethical baggage and coalescing a fractured Republican party.

While he'll have to prove his trustworthiness to his colleagues and the public at a time filled with ever-increasing cynicism about government, one challenge Flanagan will not have to face is convincing many of the rank-and-file senators he now leads to oppose policies favored by progressive New York City Mayor Bill de Blasio. As legislative session begins its final six weeks with another major leadership shake-up, de Blasio and many others from the city are looking to Albany with nervous anticipation as key policies hang in the balance.

Just moments after being congratulated on the floor of the Senate, Flanagan spoke to reporters and acknowledged the "boatload" of issues facing New York City and said that de Blasio should be reaching out to legislators and the governor to move some of the issues forward.

Earlier on Monday, before it was clear that Flanagan would be the next Senate Leader, de Blasio was asked about the power shift in Albany at an unrelated press conference. The mayor called the situation in Albany "unstable" and uneasily said, "Right now, we're focused on getting what we can get done over the next six-seven weeks in Albany for the people in New York City."

With only 17 session days left on the calendar, de Blasio is still waiting for Albany to negotiate deals on renewing sunsetting rent laws, the 421-A tax break for developers, and mayoral control of city schools. De Blasio and his allies in the City Council are also aligned with state Democrats in pushing for an increase in the minimum wage and paid family leave. It seems unlikely that Flanagan's ascent will change the Republican Majority's stance against a minimum wage increase and other changes favored by city leaders.

In fact, as he seeks to establish himself as the lone Republican of the "three men in a room," Flanagan may drive an even harder bargain than Skelos might have.

Many observers say they see Flanagan as a 'continuation of the status quo.' The 53-year-old senator has served in state government for more than half his life, is a white male Long Island Republican, worked at a lawfirm up until last week, is a member of conservative think thank ALEC, voted against marriage equality, and has already clashed with de Blasio, Senate Republicans' favorite foil.

While some of the profile fits, Republican insiders say that Flanagan's political history belies his biggest strength - his ambition. And it is that ambition that could see Flanagan become even more of a thorn in the side of de Blasio and an opponent of his agenda than even his predecessor, Skelos, who carried a major grudge after the mayor's 2014 attempt to win the Senate for Democrats.

After a fast leadership battle that some legislators say has been fracturing for the beleaguered Republican Majority, some legislators and activists say they expect de Blasio could serve as a uniter for Flanagan and the conference.

Flanagan is likely to make all effort to show strong leadership immediately. While other members of the Senate Majority have been content to serve as seat holders far into old age to keep the conference relevant, Flanagan has loftier goals. The new Senate Leader sees himself as a viable statewide candidate, and although he passed up the opportunity to run on the Republican ticket for Attorney General last year, he still harbors ambition to be Governor.

Not unlike the current governor, Democrat Andrew Cuomo - whom Flanagan will now be working with much more closely, the new Senate Leader has already tweaked Mayor de Blasio on education issues. Earlier this year, in an interview on The Capitol Pressroom, Flanagan, then chair of the education committee, said that mayoral control of schools might not be renewed and certainly would not be renewed as is. On renewal, Flanagan said: "I believe we have a very sincere and open opportunity to do so. Can I guarantee that? No."

Flanagan complained that de Blasio hadn't been particularly communicative with his conference and that he was trying to schedule hearings on mayoral control with de Blasio and City Schools Chancellor Carmen Farina.

In that same interview Flanagan chided de Blasio for failing to "properly listen" to Republican legislators from the city and for trying to win the Senate majority for Democrats.

"I would recommend to the mayor that that was not the most prudent course of action," Flanagan said. "Look, he took a shot. He decided he wanted to do something, and the good news for the taxpayers of this state is, he didn't get it. We have the majority, and in some ways, his actions helped us politically. Because a lot of the things that he stands for, people outside the City of New York find anathema to their own interests."

On Monday, when de Blasio was asked about the fact that Senate Democrats did not try to grab the majority during the chaos caused by Skelos' arrest, he said, "I'm certainly not going to speak for them. They understand their circumstance better than I do. It's a very sad moment in Albany – let's face it – and a moment that's somewhat unstable." The mayor went on to allude to the 2016 elections, when Democrats will be hoping to ride a Hillary Clinton wave into control of the chamber. "You know, the future – obviously there will be an election next year that will determine the fate," de Blasio said, "but I think that State Senate Democrats are dealing with a situation as best they can right now."

Close de Blasio ally and City Council Speaker Melissa Mark-Viverito was specific in issuing a statement congratulating Flanagan. "With so many important legislative issues in Albany - from affordable housing, to education to paid family leave - it's essential that the Legislature be able to continue it's critical work and I look forward to working with Senator Flanagan to make New York a better place," Mark-Viverito's statement reads.

Tenant activists have already written off the Republican conference as a whole because of members' connections to the real estate industry. De Blasio recently issued a housing policy agenda that supports a number of measures to strengthen rent control laws - Republicans are said to want a straight renewal of rent laws in exchange for continuation of the controversial 421-A tax abatement.

Groups tied to Glenwood Management - the developer named in charges againt both Silver and Skelos, gave Flanagan over $40,000 in the last few years, according to a study by Common Cause NY. Reporters repeatedly asked Flanagan if he was the subject of any investigations and he repeatedly said that there was nothing to worry about.

Flanagan takes the reigns of the Senate in what some have come to see as a "post unity" era. Skelos and his conference suffered major push back from the Conservative Party and upstate Republicans for cooperating with Cuomo to pass marriage equality, the SAFE Act gun control measures, and the last minimum wage increase.

With the slimmest of majorities, many expect Flanagan will look to bolster his conference by appealing to the base with attacks on de Blasio and pushback against his progressive agenda. Flanagan's opponent in the race to replace Skelos, John DeFrancisco, had the backing of many upstate and western New York politicians. Flanagan will need to appeal to them to keep the the party from fracturing.

To some Republicans Flanagan represents the more liberal branch of the party because of his support for the recent gun laws. On Monday the New York State Rifle and Pistol Association issued a statement saying Flanagan's election, is "a divisive blow to the freedom loving people of New York and should send a chill down the spine of every gun owner since the new leader voted for the so-called SAFE Act."

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by David King, Albany editor, Gotham Gazette
@DavidHowardKing

Tenant Advocates Seize on Scandal in Push for Stronger Rent Laws


make the road activists

Make the Road activists (photo: @Met_Council)


Tenant advocates, angered by Gov. Andrew Cuomo's recent comments that they see as favoring landlords and the real estate industry, protested outside his Manhattan office on Wednesday afternoon.

The action, which featured members of Metropolitan Council on Housing, Tenants and Neighbors, and Make the Road New York, is the first in what will be an onslaught targeting Cuomo and bringing up his close ties to the real estate industry, especially the fact that his biggest donor is Glenwood Management, the group tied to the federal complaints against former Assembly Speaker Sheldon Silver and Senate Majority Leader Dean Skelos.

As legislative session continues in Albany and key housing-related legislation is set to expire, advocates want to see an end to the 421-A tax break for developers and strengthening of rent regulations.

Cuomo told The Association for a Better New York on April 24 that dysfunction in Albany could lead to a straight extension of the rent laws and the controversial 421-A program that has also been at issue in the Silver and Skelos investigations. Tenant activists have taken Cuomo's comments and the possibility of his prediction coming true as an assault on their goals.

"The governor's comments were unacceptable," Javier Valdes, co-executive director of Make The Road New York, told Gotham Gazette. "It shows a real disconnect about the crisis that is going on for tenants in New York and the suburbs."

Jonathan Westin of New York Communities for Change said that his organization hopes to pressure Skelos, a Republican, and Cuomo, a Democrat, on rent laws so that there isn't simply a straight extension. "The governor supports the status quo and make no mistake about it, the status quo is a victory for real estate interests. The status quo means thousands more affordable apartments lost," Westin told Gotham Gazette.

Thomas Waters, housing policy analyst for The Community Service Society of New York, told Gotham Gazette he simply doesn't believe dysfunction is going to get in the way of negotiating the issue. "We saw how quickly the Assembly moved on from Silver's indictment," he said.

The protesters circulated a letter to Cuomo on Monday that read in part, "We write to express our outrage over your recent comments that displayed, at best, indifference to New Yorkers who are struggling to pay their rent in rent-regulated apartments. Low- and moderate-income tenants who live in more than 1 million rent-regulated apartments are at a breaking point because of the failure of leadership in Albany."

Tenant advocates are increasingly unnerved by Cuomo's comments about the rent laws, 421-A, and Skelos. On Wednesday Cuomo said he would negotiate with Skelos because he couldn't pick who runs the Senate and that 421-A must be extended. He also was asked to explain his relationship with Glenwood Management. "They are a donor of mine. They are a donor of many elected officials across the state, and that's basically the interaction," Cuomo said. "I've had nothing to do [with them], except they've been political supporters of mine."

Valdes said his group plans to convey to Cuomo that recent scandals have changed the playing field because they've exposed how things work in the backroom.

"The governor made comments in Syracuse that 421-A has to be renewed and yet it is in the complaint against Senator Skelos where he is getting kickbacks from the real estate industry," said Valdes. "There is a major disconnect here. The governor is supporting the status quo and the status quo just won't cut it anymore. We won't stand for tax breaks that favor millionaire developers while our members are driven out of their apartments.

The complaint against Skelos alleges that Glenwood, Cuomo's largest campaign donor, provided Skelos' son with $20,000 for doing no work after Skelos pressured Glenwood reps to provide his son with business.

It appears one of Glenwood's higher-ups is now serving as a witness and informant for federal investigators. Cuomo defended Glenwood during an appearance in Syracuse on Wednesday, saying he would not return donations from the company and its main players because there was no proof of "wrongdoing."

"The difference this year is that it is all out in the open," said Westin. "We see how the billionaire developers influence policy with campaign donations and illegal bribes and we aren't going to let it stand."

Advocates plan a two-headed strategy with tenant advocates tying Cuomo to major real estate donors and legislators and union members pushing Assembly Speaker Carl Heastie to play hardball when it comes time to negotiate the rent laws.

"Carl can't just go in there with Cuomo and Skelos to negotiate," said Michael McKee, treasurer of Tenants PAC. "He has to take hostages. If they want to get anything they want, Carl has to get stronger rent laws. It's up to him."

Last Friday, legislators, union heads, and Mayor Bill de Blasio came together for a strategy meeting on rent law lobbying. According to numerous sources, the meeting convened by 1199 SEIU was designed to involve more unions in the effort and convince union heads that the issue is critical to their members.

On Tuesday, de Blasio issued a statement supporting stronger rent laws and advocating a number of specific policy points like reducing how much landlords can raise rent for repairs, ending high-rent vacancy decontrol, and eliminating landlord's ability to raise the rent of rent controlled apartments by 20 percent after it is vacated. He did, however, also argue for the extension of 421-A, as long as it is tied to more clear mandates for the affordable housing that is supposed to come with the tax benefits. "No more tax breaks without building affordable housing in return," de Blasio said in a statement to the New York Times.

"The biggest thing that has changed this time around is that we have the mayor on our side for the first time," said Waters, who said de Blasio is backing the choice measures out of the slate of policy reforms his organization supports. Getting over the hurdles of a Republican-controlled Senate and a real-estate friendly governor will not be easy, of course. Plus, many Democrats at all levels of government receive large donations from real estate interests.

Landlord groups like the Rent Stabilization Association insist that a number of the measures in the rent laws that de Blasio and tenant advocates want eliminated are critical in allowing landlords to afford the costly maintenance of apartments. The RSA is currently running a television spot that laments the plight of landlords and Albany's inability to come up with a solution to help landlords maintain the housing stock.

Valdes and Make the Road will be in Albany every Tuesday for the rest of session, they've said. Session is scheduled to go until mid-June, and advocates plan a large rally during the first week that month. Other rallies are expected across the city and in Albany, with major one in Manhattan's Foley Square on Thursday, May 14.

Valdes said that his group sees an "affordability crisis" building across the city and the suburbs. "People used to think of this as a Manhattan problem but I can tell you it is an outerborough problem now."

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by David King, Albany editor, Gotham Gazette
@DavidHowardKing

De Blasio's Executive Budget: What We Know So Far


BdB City Hall Alatriste

Mayor de Blasio at City Hall on Wednesday (photo: William Alatriste)


Mayor Bill de Blasio will outline his Fiscal Year 2016 Executive Budget on Thursday afternoon at City Hall. The mayor will also release his administration's first iteration of the city's 10-year capital plan. While there may still be a few surprises, we already know quite a bit about the changes the mayor has made from his preliminary budget to his executive budget.

The budget presentation will build off the mayor's $77 billion Preliminary Budget, which he unveiled in February. That spending plan was then vetted by the City Council throughout March hearings, leading to a formal response from the Council on April 14 and ongoing negotiations, heading toward a final agreement between the mayor and the Council by the end of June. City Council Executive Budget Hearings are set to begin May 18 and finish June 9. The city's fiscal year begins on July 1.

In its formal response to de Blasio, the Council pushed for, among other items: creating a citywide bail fund (ask: $1.4M); additional investments in NYCHA (ask: additional $25M); creating a year-round youth employment program (ask: $17.3M); expanding the Mayor's Office of Veteran's Affairs (ask: additonal $600,000); providing universal free lunch to city students; investing in street resurfacing (ask: additional $103M); and of course, the big button ask: hiring 1,000 additional NYPD officers (ask: $68.7M). (Note: the asks listed are for FY2016, some numbers are projected to change in subsequent years. Read full details of the Council's preliminary budget response here).

It appears the mayor is accounting for most of the items listed above and other council asks in some fashion or another, though on several fronts the details have not yet been released. Many are eagerly waiting to see where the mayor has come down on the expansion of the NYPD force.

But in the days leading up to Thursday's executive budget presentation, the de Blasio administration has previewed several elements of the new spending plan as reported by a variety of news outlets. Some of these relate to City Council asks, some do not - a rundown of what we know so far:

  • Capital New York is reporting several details around savings that de Blasio will unveil: he plans "to create a first-of-its-kind $500 million account to pay for long-term capital projects" called "The Capital Stabilization Reserve"; he will set "aside $1 billion for the F.Y. 2016 "general reserve""; and it appears that "city agencies have come up with $530 million in savings through the end of F.Y. 2016" while "agencies found $125 million through F.Y. 2016 in additional revenue."
  • The New York Times is reporting that de Blasio will announce new homelessness prevention spending: "the city [will] commit $100 million in annual spending, including funding for rental assistance to more than 7,000 new households, anti-eviction efforts and other measures."
  • The New York Daily News is reporting that de Blasio is including additional spending on the city's most-struggling schools: "struggling and underfunded city schools will get an additional $33.6 million," with over "$20 million of the added money [going] to 94 low-performing schools already targeted for renewal by city Department of Education officials. Those schools will receive an added $250,000 per year on average, enough to hire two additional staffers or pay for hundreds of hours of extra programming for students."
  • Crain's New York Business is reporting that de Blasio is set to "propose to nearly triple funding for the city's eight industrial business service providers to $1.5 million from this year's $570,000" and "include $450,000 for new industrial and manufacturing training to give workers the skills that industrial employers seek."
  • The Wall Street Journal is reporting that the mayor will boost "propose increasing city funding to programs run by the Department of Small Business Services by 73.5%...recommending spending $43.9 million," up from "$25.3 million for the agency in the current fiscal year. The mayor is proposing that the agency's overall budget, including funding from other sources, such as the federal government, total $167 million."
  • The New York Daily News is reporting that de Blasio will announce he's devoting more money to fighting rats: "he's beefing up a successful pilot program aimed at ridding the vermin from seven neighborhoods with $3 million to make it permanent and allow it to expand citywide...over six times the $400,000 the pilot received in last year's budget."
  • At Gotham Gazette, we are reporting that it is likely the city's Board of Elections will see an increase from the preliminary to the executive budget, which would follow a trend of several years and is expected by stakeholders and experts, such as the Independent Budget Office and the BOE executive director, Michael Ryan. The mayor's office has not confirmed this report though.
  • TechCrunch is reporting that the de Blasio administration is "putting down a $70 million financial commitment over 10 years to make universal affordable broadband a reality — with most of that money being spent in the first two to three years." It's not immediately clear if that indicates new money being put into this year's executive budget, but the article came just before de Blasio spoke at a TechCrunch conference on Monday.
  • JP Updates is reporting that de Blasio "is expected to restore funding for priority-5 child care vouchers...the FY2015 budget provided $12.6 million...According to an administration official, as part of the FY16 Executive Budget, the Mayor is permanently funding the childcare vouchers by baselining the $12.6 million a year."
  • The AP is reporting that de Blasio is relieving NYCHA of money the authority is due to send the city: "New York City will waive an annual $30 million payment it is owed from the city's public housing authority...De Blasio will announce the elimination of the payment, issued every year since 1949 as a "Payment in Lieu of Taxes,"...[a] decision will save the New York City Housing Authority approximately $130 million through fiscal year 2019."
  • Additionally, the AP is reporting that de Blasio is including $125 million per year over the next five years toward the MTA budget, which has become a major source of tension.

This week, the mayor and First Lady Chirlane McCray, who chairs the Mayor's Fund to Advance New York City, "announced the creation of the Center for Youth Employment, which will coordinate and expand efforts to connect New York City's young people to opportunities for career exposure, summer jobs, quality skills-building programs, supportive mentors, and thoughtful guidance towards college and a career." The Center is a public-private initiative "conceived and launched by the Mayor's Fund to Advance New York City in collaboration with City agencies and private partners, [and] will be integrated into the existing Mayor's Office of Workforce Development."

The mayor also outlined what he'd like to see from Albany in terms of housing and tenant-protection policy, as reported by the Times, and, as reported by POLITICO, the mayor will be heading to Washington, DC next week to both lobby federal lawmakers for more infrastructure and transportation funding, as well as to unveil the "Progressive Agenda" he and others have been formulating to affect the national conversation around inequality and opportunity. 

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by Ben Max, Gotham Gazette
@TweetBenMax

Note: this article has been updated

Amid Further Ethics Scandal, What Can Cuomo Do Now?


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Gov. Cuomo (photo: @NYGovCuomo)


Last March Gov. Andrew Cuomo killed the Moreland Commission on Public Corruption in a deal with Assembly Speaker Sheldon Silver and Republican Majority Leader Dean Skelos. Now, a little more than a year later, both legislative leaders have been arrested and charged with multiple counts of federal corruption. Surrounded by scandal, it isn't immediately clear what the governor can or will do next. One thing that is sure, though, is that the worse Albany looks, the worse Cuomo looks.

After Silver's January arrest Cuomo gave a speech at NYU outlining grand ethics reform proposals like public financing of campaigns and enacting a full-time legislature. But when it came time to cut a budget deal, Cuomo again agreed to limited change in order to get an on-time spending plan. After Skelos' arrest this week, the governor has remained relatively quiet. With Albany in disarray and a national laughingstock, what can Cuomo do in a tough situation he has largely made for himself?

Reformers and political experts are torn about Cuomo's next move, especially after he's trumpeted many ethics adjustments as the end-all-be-all. Some say Cuomo needs to use the bully pulpit without fear of losing political capital, while others say Cuomo shouldn't say anything at all. On Wednesday Cuomo lamented the fact that if the charges against Skelos are true, it flies against the work he and others, including Skelos, have done trying to clean up the capital.

Zephyr Teachout, a Fordham Law professor whose speciality is corruption and 2014 primary opponent of Cuomo's, said that the Skelos indictment shows that none of Cuomo's smaller ethics initiatives have actually changed the climate of corruption in Albany. "Symbolic action won't cut it," said Teachout. "There is no bridge he can start to build right now, there is not one thing he can toss out there at this point."

Teachout added that "the thing that is so damning" about the complaint against Skelos is that the alleged corruption occurred since Cuomo's been in office, "not like the Silver indictment where things took place before Cuomo took office. So it shows us these incremental changes haven't paid off."

The Skelos complaint details how the majority leader asked Glenwood Management to steer title insurance business to his son. Skelos allegedly threatened to punish members of the real estate industry if they failed to comply with his demands and eventually a representative of Glenwood allegedly gave Skelos' son a $20,000 commission for doing no work. Glenwood steers millions of dollars into campaign accounts - including Cuomo's - of candidates running at all levels through the LLC loophole that allows them to subvert campaign finance limits.

"We've always suspected this is how things are done behind closed doors, but these complaints have really brought it into the light," said Dick Dadey, executive director of good govenrment organization Citizens Union. "Not just the influence of campaign donations but that some officials use their positions to extort," he added.

It was these kinds of relationships that the Moreland Commission was digging into when Cuomo's aides began interfering with it. And it was that kind of scrutiny that led legislative leaders to pressure Cuomo into ending the commission altogether, though it is unclear how much pressure they really had to apply.

Teachout said that Cuomo, who has taken in over $1 million from Glenwood, should go to great lengths to demonstrate he is not himself tied to the company in any quid-pro-quo arrangement.

"He should tell Glenwood their kind of business is not welcome in Albany, he should reveal his emails with Glenwood and [its head] Leonard Litwin and say enough is enough on the LLC loophole," said Teachout.

Bill Samuels, head of good government organization EffectiveNY, called on Cuomo to return all the donations from Glenwood. "I shouldn't have to call on the Governor to return this tainted money. If he were truly committed to ethics reform and cleaning up Albany, Cuomo would have immediately returned these funds to Glenwood Management and expressed outrage over this latest corruption scandal unfolding on his watch," Samuels said in a statement.

Cuomo told Capital New York at a press conference in Syracuse on Wednesday that he would not return the donations or refuse to accept more because Glenwood representatives had not been charged with wrongdoing. "If no one did anything wrong, then you can't just say, 'You have no right to participate in the political process,'" the governor said.

Dadey agrees that Cuomo should not have to return the contributions because they were made legally, but says that it would be, "Helpful to know what kind of interactions the administration had with Glenwood."

Karen Scharff, executive director of Citizen Action NY, said she feels Cuomo's attempts at ethics reform haven't paid off because he is so concerned about immediate political wins rather than the long-term good. Scharff said she'd like to see Cuomo take to the bully pulpit on public financing of elections even knowing that he won't win this year, but ready to take a loss and do it to build political momentum.

Teachout agrees. "If he actually believes in reform he has to show he is willing to take genuine political risk," she said. "He has to come out saying: 'Win or lose I am going to put capital on the line for this to get credibility."

Blair Horner, legislative director of the New York Public Interest Research Group, told Gotham Gazette that he has concerns that public financing of campaigns simply won't go anywhere because Senate Republicans are ideologically opposed. He and other good government advocates also worry that Cuomo no longer has any credibility on reform issues and that his proclamations on the subject have become white noise to the public and to legislators.

"The governor has eroded the bully pulpit," Horner said. "He has been delivering speeches but not real reform. In Albany, talk is cheap. He has shown that he prefers triage but that doesn't get you anywhere."

Dadey said that Cuomo must stay on the soap box to "connect the dots of corruption for the public."

"The governor must not allow this saga of scandal and corruption to prevent him from enacting real ethics reform," said Dadey. Good government groups like Citizens Union and NYPIRG, as well as reform-minded legislators and Attorney General Eric Schneiderman, have been calling for sweeping reforms aimed at truly cleaning up Albany's corruption problem. They say that the time for incrementalism is over.

Horner said that action is critical and he thinks the governor could find quick consensus with the Legislature on certain issues. Horner wants to see a new ethics watchdog where "the appointees aren't captives," a bill to restrict legislators' outside income, and legislation to end the LLC loophole. "The time for fake ethics reform has long past," said Horner.

Cuomo has remained relatively silent on Skelos' indictment. On Wednesday he said he will not call on Skelos to resign because, "I don't have the option of picking who they pick as their leaders. They pick a Senate leader, I will work with that leader," Cuomo said referring to state senators, especially the Republican majority.

Doug Muzzio, professor of political science at Baruch College, said he believes Cuomo is doing the best thing he can for himself by remaining mum on the scandals that have left Albany more dysfunctional than ever. "My initial inclination is he should keep quiet, stay far away from it, don't even comment," Muzzio told Gotham Gazette. Cuomo appears to be taking that tack, instead promoting on Wednesday that several private New York colleges have signed on to his campaign aimed at reducing sexual assault on campuses and penning an op-ed in the New York Times announcing his new move geared at raising the wages of fast-food workers.

What he'll do next on ethics reform is far from clear. Muzzio said Cuomo should avoid making any grand speeches on reform because everyone has heard it before. "I don't think Groundhog Day works because the press are gonna hang him for it. He should keep quiet while working toward a strategy of reform because this is going to pass."

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by David King, Albany editor, Gotham Gazette
@DavidHowardKing

With Focus on Mental Health, Push for New City Veterans Agency Continues


vets at hearing

Veterans at Wednesday's City Council hearing (photo: William Alatriste) 


The City Council’s Committee on Veterans held an oversight hearing Wednesday to gauge the effectiveness of the Mayor’s Office of Veteran Affairs (MOVA).

The hearing seemed the latest chapter in a renewed push for a separate Department of Veterans Affairs by Council Member Eric Ulrich, who chairs the veterans committee, and like-minded council members and advocates. Ulrich introduced a bill last year which would create a new department to deal with veteran affairs, removing the office from directly within the mayor’s in order to increase its profile, funding, and transparency. “Ideally such an agency would be fully funded and would act as a one-stop shop for any need that a veteran might have,” Ulrich said at Wednesday’s hearing. He stressed that MOVA needs dedicated funding and personnel to better serve New York City’s 225,000 veterans.

MOVA Commissioner and retired Army Brigadier General Loree Sutton testified before the committee and reiterated her office’s top strategic priorities in serving veterans’ needs, namely ending veteran homelessness, focusing on mental and behavioral health for veterans, and developing employment opportunities for veterans.

Mayor de Blasio announced at his 2015 State of the City address that he would end veteran homelessness by the end of 2015 and Sutton indicated today that she was confident of reaching that goal.

“Mission and strategy drive programs and budget,” Sutton said in her testimony. She repeatedly stressed that MOVA’s work goes beyond it’s own budget and personnel, working with multiple city agencies to help veterans in need.

Sutton has yet to take a public position on Ulrich’s bill, and it is clear that the de Blasio administration is in no rush to back it. Responding to Council Member Fernando Cabrera’s query on whether an independent agency could be more effective, Sutton said, “I will keep that as an open question going forward. My pledge to the mayor, to the taxpayers, to the veterans, to the families in New York, is to make the best use of the resources that we currently have. We’re in the midst of doing that right now. Once I have convinced myself that we have maximized the resources that we have, then we’ll be in a position to assess what might make sense going down the road. “

When asked, Mayor de Blasio has not supported the idea of creating a new agency. The proposal received overwhelming support today from veterans advocates and organizations and even the office of Public Advocate Letitia James. “Disappointingly, our Mayor’s Office of Veterans’ Affairs is not funded in a way that reflects the actual needs of our veterans,” said Oswaldo Pereira, a veteran and outreach coordinator for the public advocate’s office, who was speaking on behalf of James. “Veterans deserve to have a department that can truly serve their needs,” he added.

Joseph Bello, founder of NY MetroVets, criticized Commissioner Sutton for her silence on a new veterans department. “It is time to create a free-standing direct services agency that can not only have preliminary and executive budget hearings on veterans issues, but can funnel contracts awarded to veteran service providers in the boroughs directly, instead of through other city agencies that are unfamiliar with these groups.”

There was much focus at the hearing on mental health issues, a concern raised by committee members Cabrera and Paul Vallone. Sutton told Cabrera that mental health issues were “an area in the system that could use some additional development.” Toward that, she pointed out MOVA’s partnership with First Lady Chirlane McCray through the recently announced Mental Health Roadmap due to be released in the fall.

Vallone was quick to point out that the $54 million plan failed to mention veterans. “When I see this go up and I don’t see my veterans in here, I gotta fight for it,” Vallone said. Sutton promised the committee, however, that when the final strategy is released, veterans would figure significantly.

Representing the Veterans Mental Health Coalition of New York City, Melissa Earle also called for expanding MOVA to the level of a department. “With a department dedicated to serving veterans, greater resources and funding can be secured to better overcome the complex challenges of veterans of all generations,” she said.

Ulrich’s bill has a veto-proof 40 co-sponsors (in the 51-member body) and he has indicated that he would be willing to push it forward even without the mayor’s support. 

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by Samar Khurshid, Gotham Gazette
@samarkhurshid

City Board of Elections Expected to Again See Budget Bump


BOE Michael Ryan

BOE Executive Director Michael Ryan (photo: @BOENYC)


On Thursday, Mayor Bill de Blasio is set to unveil his Fiscal Year 2016 Executive Budget, which is likely to be nearly identical to the final budget passed by the mayor and the City Council before the June 30 deadline. Much of the new version of the mayor's spending plan will be similar to his $77 billion preliminary budget, which he presented in February and was vetted throughout March by the Council. But, the de Blasio administration has already acknowledged several areas where funding levels will show a difference on Thursday, with increases planned to support manufacturing, mental health services, the MTA, struggling schools, and more.

One under-the-radar aspect of the budget that is set to see a significant change from preliminary to executive is funding for the city's Board of Elections, which administers New Yorkers' opportunities to vote.

The preliminary budget includes approximately $84.4 million for the Board of Elections (BOE), a drop from the $113.9 million that the BOE is spending in fiscal year 2015, which wraps up at the end of June. It's a differential of about $29.6 million, a 26 percent decrease.

This disparity, however, is unlikely to stick. According to the Independent Budget Office (IBO), this year's preliminary budget allocation for the Board of Elections follows a pattern of the last several years. In fact, fiscal 2016 includes a larger preliminary provision for the BOE than preliminary budgets of previous years. Doug Turetsky, IBO Chief of Staff and communications director, told Gotham Gazette that this is not something that should raise eyebrows just yet; the trend is that the actual budget will make up the $30-40 million gap from the preliminary plan. If funding stays the same, there might be reason for concern that BOE is being underfunded. But it is also important to keep in mind that each year brings different elections, whether they be on the city, state, or federal level.

It may appear a curious annual underfunding in the preliminary, just to be increased in the executive or the adopted budget, but Turetsky said that there is often talk of moving federal primary elections from June to September to coincide with state and city primaries, which would foster efficiency and decrease budgetary need. If the figure in the preliminary was closer to what will likely be in the actual budget, Turetsky explained that it may act as a "disincentive" for the state to move state and federal primary elections to the same date. By holding off on the additional funding, it puts pressure on the state to decide and, ideally, move toward a single voting date.

Council Member Ben Kallos, chair of the City Council Governmental Operations Committee, spoke similarly, but did express concern about the general issue of underfunding BOE operations. Kallos told Gotham Gazette that while the BOE tends to overestimate its financial need, if it is not appropriately funded "it is the elections and democratic process that suffers." While Kallos is looking for stronger numbers in the executive budget, he also said that "if we over-budget then that means that another agency loses."

Getting to the final adopted number is part of the process of having preliminary budget hearings in March and executive budget hearings in May and June. Kallos' committee heard from BOE representatives in March and will hear from them again as the mayor and the Council head toward an agreement.

BOE Executive Director Michael Ryan is not worried about the dramatic trend that some might say resembles the "budget dance" affecting his agency's operations in the coming year. Ryan told Gotham Gazette that the BOE still needs an estimated $12 million; approximately $2.2 million to update the expiring warranty for electronic voting and the other $10 million to meet federal mandates for ADA accessibility. Ryan expressed confidence that his agency will be appropriately funded.

The "lean and mean preliminary" as he called it, is just part of the process. The real focus is on the executive budget, he said, with little concern over the difference between the two proposals. He also put his agency into larger budgetary context. "The executive budget should be a balancing between what the mayor's office ultimately believes an agency needs to function and what the city expects to receive in tax revenue, because the city must operate on a balanced budget," said Ryan.

Ryan told Gotham Gazette that the trend has continued because it works for budget planning purposes. By underestimating in the preliminary budget, the mayor's office establishes a baseline (or placeholder as it has been called) that can be edited henceforth, after the hearings, negotiations, and decisions that follow - including decisions made on the state or federal level. "It's a check and balance, to make sure that not just the Board of Elections, but that all the agencies that are asking for funds that they actually need," Ryan said.

Ryan also said that another reason the city keeps careful tabs on the allocation of funds is a result of the budget crisis of 1975, when the city went bankrupt, spending into debt of an estimated $14 billion. Shortly after the crisis, a law passed requiring balanced budgets, removing leeway for the city to operate on deficit spending.

"I'm not anticipating any issues, quite frankly," said Ryan. "I think it's all gonna work out fine and we've been working very closely with the mayor's office to make sure that our needs are met and that we're able to fulfill our statutory and constitutional mandate to provide elections for the voters of the City of New York."

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by Shannon Ho, Gotham Gazette
@ShanMHo @GothamGazette

Dean Skelos Thwarted Reform and Maintained Power, Despite the Odds


Skelos Silver Cuomo

Dean Skelos in 2012 (photo: The Governor's Office via flickr)


In June 2008, after serving 23 years as the State Senator from Nassau County, Dean Skelos inherited the troubled Republican conference from retiring Majority Leader Joe Bruno. It wasn't exactly the most enviable position.

Facing an aging conference and with Democrats enjoying a huge enrollment advantage across the state, 2009 saw Republicans enter the Senate minority for the first time in decades. The same month Skelos began his stint as minority leader his predecessor was indicted on eight counts of corruption. It began Skelos' long but successful fight to keep his conference not only relevant but in charge when it mattered the most in terms of decision-making for the future of his party.

Now, seven years later, Skelos faces a federal complaint with several charges, including monetizing his office by arranging payments to him and his son through a developer who sought favorable legislation. The case involves many elements of state government that have been attacked as corrupt and unethical - from the LLC loophole that allows donors to pump the lifeblood of campaign cash into the Republican conference, or the 421-A tax break for developers that has been attacked as a giveaway to corporate donors, major issues at play in the indictment are parts of how Skelos managed to keep himself and the Senate Republicans in power in Albany.

"I'm going to be president of the Senate, I'm going to be majority leader," Skelos allegedly told his son during a phone conversation about their deal with a developer - a call being recorded by federal agents. "I'm going to control everything, I'm going to control who gets on what committees, what legislation goes to the floor, what legislation comes through committees, the budget, everything."

On Monday Skelos issued a statement claiming his innocence and worked to maintain his role as leader of the Senate Majority.

Karen Scharff, executive director of Citizen Action, an organization that has advocated many major reforms that Skelos directly opposes, said that Skelos' power can be directly traced back to the policy he delivers and the reforms he opposes.

"It was never more clear than in last year's Senate elections how much the system helped keep the Republicans in power," said Scharff. "They raised vast amounts of money from hedge funds that were interested in very specific policy points and had them spend massive amounts of money in independent expenditures to deliver the policy that keeps them in power."

During his time as Majority Leader Skelos won battles on redistricting, not only pushing back efforts to create independently drawn lines but even succeeding in the creation of the 63rd Senate seat upstate. He publicly derided campaign finance reform, public financing of campaigns, and efforts to have lawyers disclose their clients. And behind the scenes he was mostly successful in holding back the tide of government and campaign finance reform. He's appointed members to the state's Joint Commission on Public Ethics, or JCOPE, and fought successfully to kill the Moreland Commission on Public Corruption. As the federal charges against him and much political history show, Skelos has not been alone in any of this.

The indictment against Skelos alleges he monetized his office by abusing the same systems and loopholes that he protected from reform. The charges against Skelos say that the developer involved in the kickback scheme used the LLC loophole to subvert campaign finance limits. Only last month, Skelos' new appointee to the Board of Elections thwarted efforts to eliminate the same loophole.

Skelos maintained this power by cutting deals with Democrats like Gov. Andrew Cuomo and Independent Democratic Conference head Sen. Jeff Klein who both share some of Skelos' economic concerns and larger donors.

"Skelos' indictment gets to the core problem," Scharff told Gotham Gazette. " Those who raise the most money are the ones who have the most power and they have gone out of their way to make sure reform doesn't happen. They have made sure it is built into how Albany works."

How He Got Here: The Coup
In 2009, Senate Democrats reveled in their new-found power. Exposing Bruno's largess - personal, customized vans for his use, private printing facilities, and television studios, Democrats were riding high as they took control of the chamber. But Democrats only enjoyed a few seat margin over Republicans.

The "Three Amigos" including Pedro Espada, Carl Kruger and Ruben Diaz pushed for more power within the conference in exchange for their loyalty. Democratic Majority Leader Malcolm Smith appeared weak and scattered. Meanwhile Buffalo billionaire Thomas Golisano, who had helped Democrats win the majority, felt ignored by Smith. He and his political fixer Steve Pigeon met with Skelos and Republican Sens. Tom Libous and George Maziarz in an Albany rock club and began devising a Senate takeover.

They recruited the dissatisfied and particularly-ambitious freshman Espada and Espada recruited Sen. Hiram Monserrate. On June 8, 2009, with only days left in session, facing the expiration of mayoral control of schools and the rent laws, Republicans lept into action. Republicans moved for a surprising leadership vote and although it was disputed by Democrats soon Skelos was standing in the chamber shaking hands with Espada - the two split Smith's positions as Majority Leader Espada and Senate President Skelos.

Control of the Senate was disputed for months. Eventually Espada and Monserrate rejoined the Democratic conference but the damage had been done - rifts in the Senate Democrats were made public, and they were painted as dysfunctional during their first shot at the majority in decades.

Worth noting is that at the time both Monserrate and Espada faced ethical questions beyond just conniving for Senate power. Espada was eventually convicted of stealing from his own health clinics, in one case using cash for HIV victims to fund his campaigns, and Monserrate was eventually expelled from the Senate for slashing his girlfriend's face with a bottle. And yet, Skelos partnered with both men for a tenuous shot to regain control of the Senate.

Keeping Power Through Redistricting
In 2011 Skelos regained the title of Senate Majority Leader thanks to major donations from real estate, developers, and New York City Mayor Michael Bloomberg, and it wasn't a moment too soon. A coalition of reform groups led by former Mayor Ed Koch were pushing for legislators to deliver a redistricting plan that better reflected the actual enrollment and population of the state. For decades Senate Republicans and Assembly Democrats engaged in a redistricting process that allowed them to draw districts that would assure their incumbents had the best chance of being reelected, disregarding the actual makeup of communities. Skelos played hardball, slamming Koch's efforts as "partisan."

Eventually Cuomo gave up his pledge to veto any district lines that were gerrymandered and agreed to new lines that drastically favored Senate Republicans, even creating a 63rd district upstate that suspiciously carved its way around major population centers and incorporated rural towns populated by more voters who were more likely Republican.

During this time Skelos proved to be a valuable ally to Cuomo as he helped the governor pass some of his more conservative fiscal plans, including a tax cap, while also delivering Cuomo the votes he needed on same-sex marriage. Although Cuomo also delivered a highly-touted ethics package that year, advocates insist that major issues were ignored because Skelos and Senate Republicans refused to cede any ground on campaign finance reform as they believed the current system was essential to keeping them in the majority.

2013-2014 Deals and The Death of Moreland
Democrats technically held enough seats for a majority after the 2012 elections but Skelos cut a deal with the IDC and newly-elected Sen. Simcha Felder to create a coalition government which saw Skelos rotate control of the chamber with Klein. During this time a number of legislators were indicted on corruption charges and advocates began a major push for public financing of campaigns. Skelos stood steadfast against campaign finance reform, even holding a hearing against the policy featuring national anti-public finance advocates.

"Public financing of elections would not have stopped any one of those crooks and idiots from doing what they did," Skelos told reporters on April 23, 2013. Skelos directly referenced Smith who had been indicted that day on counts that he tried to bribe his way onto the Republican ticket in the race for New York City mayor.

As pressure mounted in 2013 Skelos obstinately opposed a series of reforms proposed by Cuomo - a package of reforms most advocates actually considered insignificant. Finally Cuomo made good on his longtime threat to empanel a Moreland Commission to investigate public corruption. For months, as Moreland held hearings, Skelos and now-indicted then-Assembly Speaker Sheldon Silver waged a court battle against Moreland and publicly decried it as a "witch hunt."

"These actions amount to an attempt to coerce or threaten the Legislature and upset the separation of powers that exists between the executive and legislative branches, and cannot be accepted," Skelos wrote to Senate Republicans in November 2013.

It was in 2013 that reports of possible influence by Cuomo's office into the commission began. Some Moreland insiders insisted Cuomo's office was particularly deadset on stopping subpoenas to the Real Estate Board of New York, whose members are key Cuomo donors, but also major backers of Skelos and Senate Republicans. Cuomo began facing increasing pushback from Skelos and Silver during 2014 budget negotiations.

Moreland was reportedly closing in on ties between donations from the real estate industry and policy and it was making everyone in charge antsy. In March, Cuomo quietly announced he had killed Moreland in exchange for his proposed slate of reforms. "Skelos killed the commission just as it was starting to expose the quid-pro-quo system that is built into Albany," said Scharff.

As the 2014 election season kicked into high gear Cuomo felt increasing pressure to support a Democratic Senate and align himself with liberal policy. The governor promised the Working Families Party he would help elect Democrats to the Senate and the IDC promised it would caucus with Democrats.

Senate Republicans mobilized their major donors, reminding them of the coming sunset of the rent laws, the push to expand charter schools in the state, and of the "Democratic dysfunction of 2009." Not only did the real estate industry pour record amounts of cash into Senate Republican coffers, but it marshalled a number of independent expenditures to boost candidates in important districts.

This Year
Republicans started 2015 with the wind in their sails. They had won complete control of the Senate and soon after the year began Silver, longtime Democratic Assembly majority leader, was indicted. But quickly word came that Skelos was also a target of US Attorney Preet Bharara. Still, Skelos rejected just about any Democratic policy proposed in the state budget: tossed out were proposals on campaign finance reform, renewing mayoral control of schools, criminal justice reform, raising the minimum wage, and a host of other issues.

After returning from the budget break in mid-April, Republicans largely ignored the major outstanding issues. Session became a parade of small-time legislation having to do with vanity license plates and honoring local sports teams. Last week as more chatter picked up around Skelos' possible indictment, session slowed even further with Republicans spending more time in conference.

Finally on Friday the New York Times and Wall Street Journal reported federal prosecutors might arrest Skelos on Monday. Skelos and his son faced charges in court and the Senate Majority leader proclaimed his innocence. Senate session went on as planned Monday afternoon, with little of substance being discussed and many Republican Senators expressing solidarity with Skelos, the man who kept them in power against the odds. But signs exist of a possible break in the solidarity. Some, like Sens. John DeFrancisco and John Flanagan jockeyed to replace Skelos while others like Sen. John Bonacic said Skelos had to resign with an indictment over his head.

Democratic Sen. Michael Gianaris said he was "troubled" by the allegations against Skelos, adding: "Senator Skelos should now step down as Majority Leader for the good of our state and in the interest of allowing the remaining weeks of our legislative session to proceed without distraction. There are too many important issues which remain unresolved, ironically including several long overdue ethics reforms and expiring housing laws."

Saying that "Legislative leaders must be held to a higher ethical standard of conduct and his actions violate that standard," good government group Citizens Union called for Skelos to step down from his leadership post on Tuesday.

Klein, who maintains a deal with Senate Republicans, did not call for Skelos to resign. "The burden now falls on the Republican Conference to determine if new Republican Leadership is warranted," Klein said in a statement.

Cuomo, who has remained mostly in New York City of late, was in Albany Monday, but his only public event was an announcement that he participated in by phone. He did not comment on the Skelos matter.

Scharff and Blair Horner of the New York Public Interest Group both said it is now up to Cuomo to push through the reforms he could not achieve earlier this year. "At the top of that list of legislative "must dos" are initiatives to overhaul ethics enforcement, limit outside income, and reign in the influence of New York's powerful special interests," said Horner. "The governor must take up the unfinished Moreland Commission agenda to restore the public's confidence in state government; specifically closing the LLC loophole."

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by David King, Albany editor, Gotham Gazette
@DavidHowardKing

Note: Gotham Gazette is an independent publication of Citizens Union Foundation, sister organization of Citizens Union

Even Amid Albany Dysfunction, Advocates Forge Path to Paid Family Leave


wfpct paid family leave

Advocates for paid family leave (photo: @CTWFP)


Upheaval in the capital due to another high-profile corruption scandal is not stopping advocates from heading to Albany to push for legislative action.

With just six weeks left in the legislative session set to expire mid-June, on Wednesday activists will rally at the Legislative Office Building and lobby lawmakers to pass paid family leave in New York State.

An 11:30 a.m. press conference will be led by Democratic State Senators, including bill sponsor Joseph Addabbo, calling for passage of the Paid Family Leave Insurance Act in the Republican-controlled Senate. The companion bill, sponsored by Assembly Member Cathy Nolan, passed in the Democrat-controlled Assembly in March. Addabbo’s bill failed a Senate vote two weeks later, just before a fiscal year 2016 budget deal was reached.

Though a new cloud hangs over the Legislature after federal corruption charges were brought against Republican Senate Majority Leader Dean Skelos on Monday, it does not appear that substantive policy work in the capital will completely halt. There is reason to be skeptical that legislation will be approved by both houses to ensure New Yorkers are able to take paid leave to care for a sick family member or spend time with a new child, but the issue has captured the attention of many, and has gained new momentum at the city, state, and federal levels.

Negotiations over the paremeters of any paid family leave bill could be among the highest profile in Albany and legislative action on this issue could again make New York a national policy-making leader - perhaps garnering the type of positive attention the state could use given its growing reputation for corruption in its elected ranks. New York could become just the fourth state to pass a paid family leave law.

A representative of the Obama administration met recently with New York leaders on the subject as the president looks to pass legislation creating a fund to help states support family leave and a representative from Hillary Clinton’s campaign listed it as a priority for the presidential hopeful. New York Senator Kirsten Gillibrand, who is sponsoring federal paid family leave legislation, recently lamented that "The United States is the only industrialized nation in the world without any form of paid family and medical leave.” She promised “to continue the fight in Washington to pass the FAMILY Act to finally set a federal paid leave program." (The 1993 American Family and Medical Leave Act ensures 12 weeks of unpaid leave)

Gillibrand’s comments came during a video message that was played last Thursday at an event in New York City - and livecast to sister events in cities across the state - organized by the Paid Family Leave Insurance Campaign, which is at the heart of the Albany lobbying set for Wednesday. The campaign is made up of advocacy groups, unions, and elected officials; members include 1199 SEIU, 32BJ SEIU, Citizen Action of New York, Community Service Society, New York Civil Liberties Union, New York Paid Leave Coalition, and the NYS AFL-CIO. On Friday, Gillibrand expressed optimism about paid family leave, and said she is working both with leaders in New York state government and also pushing her bill on the federal level.

Representing the Obama administration, U.S. Secretary of Labor Thomas Perez also recorded a message that was played to those in attendance last week. Perez and White House senior adviser Valerie Jarrett have been traveling the country promoting paid leave in what the administration is calling "Lead on Leave." It was Jarrett who previously met with New York officials.

At this point, however, movement on paid family is most likely to occur at the state level of government, at least between now and the summer. Looking to Albany, the New York City Council passed a resolution last week recommending that the state pass the Paid Family Leave Act. In her remarks at Thursday’s event, New York City Public Advocate Letitia James said that her office’s report on the subject indicates that Albany is the best place for legislation to occur.

While there is support for the general principle of paid family leave in both houses of the Legislature and from Governor Andrew Cuomo, there is no clear path forward in terms of policy specifics. A key sticking point, of course, is where the funding will come from to pay for the employee leave involved.

At last Thursday’s rally, State Senator Addabbo said, “As the Senate sponsor of this legislation, I am delighted that the State Assembly has approved this bill, and I hope my legislative chamber will follow suit.”

“In the absence of action by Congress,” he added, “we need to change...one state at a time – and New York should be next, following the lead of New Jersey, California and Rhode Island.”

If some version of paid family leave is to pass both houses of the New York State Legislature and head to Governor Cuomo’s desk, it is unlikely it will be the Addabbo-Nolan version. A different paid family leave proposal in the Senate, sponsored by Independent Democratic Conference Leader Jeff Klein, differs from the Addabbo-Nolan bill on the source of funding. Klein’s version was included in the Senate’s one-house budget, but no compromise was reached in order to include paid family leave in the final state budget deal at the end of March, pushing the issue into legislative session.

Klein has reiterated that paid family leave is a top priority for him this session. In a statement to Gotham Gazette, Klein said, “At the Senate's Paid Family Leave hearing [in March], we heard from advocates, the business community and organized labor – and we are actively weighing their concerns and working towards a plan that’s both fair and balanced. In the coming weeks and months, I will continue to collaborate with my Senate colleagues to pass Paid Family Leave in New York State and put our hard-working families first.”

Governor Cuomo has expressed support for the issue, but he seemed to be caught off guard by the momentum behind it after he had declared there to be little appetite for paid family leave while he worked to pass his ten-plank women’s equality agenda, which is now moving through the Legislature in pieces.

Cuomo’s office recently indicated that leaders of the majorities from each house do not seem close on a paid family leave deal. It was unclear if his administration is doing anything to facilitate compromise.

In summarizing last Thursday’s rally, a press release from the New York Paid Family Leave Insurance Campaign says that significant lobbying efforts are set to begin: “In each region, labor and community leaders identified local actions and events to mobilize citizens between now and the end of the legislative session.” Wednesday’s event in Albany will be a major part of these efforts, but it remains to be seen how much attention any issue can get with Albany in further disarray.

The conversation around paid family leave has gained traction nationally since President Obama mentioned it in his State of the Union address earlier this year. The President is attempting to pass the Healthy Families Act to create a $2 billion fund to help states implement paid family leave. Senator Gillibrand has introduced the federal Family and Medical Insurance Leave (FAMILY) Act, which has 12 Democrat co-sponsors.

While federal aid could provide a significant push, New York does already have the mechanisms to implement paid family leave. But, reticence among business leaders about what they see as another possible regulation and potentially unfunded mandate is shared by Republicans (and some Democrats) who staunchly refuse to lay the burden for paid leave on employers.

The concerns about the law raised by the business community seem unsubstantiated when the experiences of other states with paid family leave are taken into account. Meanwhile, the Nolan-Addabbo version of paid leave actually bases it on employee contributions rather than state funding. The Klein version, which appears to at least have some support from Senate Republicans, calls for the state to pay at least $125 million in the first year of implementation with the following years supplemented by employee payroll fees.

The paid leave campaign backing the Addabbo-Nolan bill stresses that “the paid family leave insurance benefit is entirely employee-paid,” and that “the law does not create a new administrative requirement, but rather expands New York’s existing Temporary Disability Insurance program (TDI) through a small increase in premiums that would continue to be shared by employers and employees, as they are now.”

In California, a paid family leave (PFL) law was passed in 2002 and went into effect in July 2004. In the years since, the fears that businesses had about the effect of PFL on their productivity and the local economy turned out to be unfounded. According to a 2011 report by the Center for Economic and Policy Research (CEPR), 89 percent of employers said that PFL had a “positive effect” or “no noticeable effect” on productivity and 91 percent said the same about profitability and performance. (The report was based on a survey of 253 employers and 500 individuals conducted in 2009 and 2010).

“California serves as a model for other states and the national level,” said Greta Twombly, campaigns manager, American Sustainable Business Council. “It’s considered a success. Businesses were worried about it hurting their bottom line. Data year after year shows that’s not the case.”

Twombly insists that paid family leave helps businesses avoid the costs of hiring and training new employees and evens the playing field for businesses that already provide certain benefits to their employees.

In New York, she said, “There’s direct competition between companies that provide it and those that don’t. There are companies that want to provide it but can’t because there are no logistics for it or their competitors don’t so they can’t afford to either.”

In 2009, New Jersey became the second state to establish paid family leave through the state Family Leave Insurance (FLI) program. Again, most employers felt that the program didn’t affect profitability according to a report released by CEPR last year. CEPR surveyed 18 employers ranging from 26 to 36,000 employees and none of these businesses said it affected productivity or turnover. Only two employers said it had a negative effect on their bottom line. Even in New Jersey, Twombly said, “There have been no terrible, dramatic, scary effects that opponents touted. Quite the opposite.”

Rhode Island only created its paid leave program in 2013. It is funded through employee contributions and so has minimal impact on employers. “In Rhode Island, a lot of employers were already doing this in one way or another,” said Erik Rettig, North-East outreach manager, Small Business Majority. “People getting sick is not new.”

Citing a poll conducted in 2013, Rettig said business owners are in favor of policies based in shared contributions or employee payroll deductions. But the challenge for New York is clarity in policy. “A lot of times these policies are piecemeal,” Rettig said. “They’re cobbled together. Businesses don’t look forward to that.” Although he conceded that it would be tough to expand temporary disability insurance to pay for paid family leave, a cost that would fall on employers, he argues “It makes business sense at the end of the day. There’s no evidence to support the fact that it isn’t working for businesses. There is evidence to the contrary. Business owners get this. They just want to make sure it happens in the right way,” Rettig said.

Senator Klein has been trying to champion his version of paid family leave through the Senate, albeit by separating it from TDI. "Including Paid Family Leave in the Senate’s one-house budget was a major step forward for New Yorkers,” Klein said in a statement to Gotham Gazette. Where it goes now is unclear.

At the event Thursday, Public Advocate James said, “We are here for one simple reason: No one should have to choose between taking care of their family and losing their job.”

James added: “Paid family leave is a basic protection guaranteed to working families in 185 countries around the world, but our city, our state, and our country are lagging severely behind.”

***
by Samar Khurshid and Ben Max, Gotham Gazette
@samarkhurshid @tweetBenMax @GothamGazette



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