Gotham Gazette Wed, 26 Jun 2019 02:31:21 +0000 Joomla! - Open Source Content Management en-gb (Webmaster) Law Department Budget Hearing Focuses on De Blasio Administration Legal Defense de blasio aides courtyard

Mayor de Blasio & aides in a courtyard (photo: Mayor's Office on flickr)

The investigations into Mayor Bill de Blasio’s administration have cost the city $10.5 million in outside legal defense spending so far, and might cost millions more, said Corporation Counsel Zachary Carter at a City Council preliminary budget hearing on Monday.

Carter, who heads the city’s Law Department, testified before the Council’s Committee on Governmental Operations that the state and federal investigations into the mayor and his aides necessitated the hiring of outside counsel. “The ongoing investigations are criminal in nature,” Carter told Council Member Ben Kallos, the committee chair, “and I know from my 40 years of experience in law enforcement that that is a…specialized area of practice that requires experience because of the delicacy of the judgments to be made.”

Carter noted that the investigations involve an area of practice “particularly sensitive to conflicts of interest” and dozens of witnesses, some of whom insisted on independent counsel, thus the hiring of at least 11 outside law firms for the legal defense.

He also estimated additional costs for the next fiscal year, which begins July 1, but insisted they would not be substantial. “I don’t believe that it will be a large magnitude of expenditures,” he said, predicting that the investigations are winding down. Late last month, the mayor sat down with federal prosecutors for a four-hour interview, which many saw as a sign that the U.S. Attorney’s office was nearly done with its probe. The mayor also met with the Manhattan District Attorney’s office weeks prior to that. The mayor’s own legal fees are not being paid by taxpayers; he plans to set up a legal defense fund to pay the bills he has accrued.  

Carter could not provide an exact dollar amount for the expected costs as the investigations wrap up, but he said that there may be “an additional seven-figure expenditure” for the department.

Although the cost to the city to defend the mayor and his aides has been a source of significant criticism, it is a relatively small part of the Law Department’s proposed preliminary budget of $206.3 million for fiscal year 2018, which is down from $211.5 million in last year’s adopted budget. (In the November budget modification, the department’s outlay was revised to $220.3 million for the current fiscal year (2017).)

Council Member Kallos noted at the hearing that the city’s budget for judgements and claims resulting from lawsuits for fiscal year 2018 is $720 million, and projected to increase to $740 million by fiscal year 2021. It’s an issue Kallos has raised for years, pushing the administration to reduce the amount of money it budgets for lawsuits by instead rectifying problems that are sources of constant claims against the city.

City Comptroller Scott Stringer has taken aim at the issue in two annual reports, the most recent released Feb. 10, that include a data-driven approach to reducing preventable lawsuits. For instance, Stringer’s report noted the five costliest personal injury claim categories that accounted for 78 percent of all personal injury settlements and judgments in fiscal year 2016: civil rights claims ($158.0 million), medical malpractice claims ($101.1 million), police action claims ($100.6 million), motor vehicle claims ($89.7 million), and sidewalk claims ($31.8 million).

In response to Kallos’ concerns, Carter noted that the department has a risk management unit that specifically advises the city on recurring themes in the types of claims made against employees and agencies. The department does not, however, create reports on that unit’s work with different agencies to mitigate risks.

“We’ve got his $720 million plan to pay out,” Kallos said. “How much can you and your unit reduce from our plan to payout from before?”

“I don’t believe that we can give a firm estimate on reduction,” Carter responded. “I think that it is fair to say that any time we provide feedback to agencies, in connection with these conditions, that it reduces the likelihood these conditions will recur, but I’m not in a position to quantify that with certainty.”

Carter also noted that “a handful” of large settlements from lawsuits spanning years can “distort” the judgements and claims budget, which has remained otherwise relatively level. For instance, per Stringer’s report, in fiscal year 2016 four settlements from old cases against the NYPD totalled $76.7 million or 27 percent of the $279.7 million payouts by the NYPD. The City paid out $629.5 million in total for claim settlements and judgments that year.

In 2016, Carter said, there were 32,640 claims filed against the city.

Kallos also made another push for performance budgeting, or tying the allocations for key initiatives and programs to quantifiable results.

[Related: Renewed Push for 'Performance Budgeting' Through Mayor's Management Report]

Carter was supportive of the idea. “I agree with you that we should use performance measures and we’re certainly willing to provide statistical information that actually presents an accurate picture of the progress being made to reduce judgements and claims,” he said.

by Samar Khurshid, senior reporter, Gotham Gazette

Read more by this writer.

Law Department Budget Hearing Focuses on De Blasio Administration Legal Defense Mon, 13 Mar 2017 04:00:00 +0000
Additional Information Means 'Ongoing Investigation' into Rivington Deal BdB holds paper hearing

Mayor de Blasio (photo: Michael Appleton/Mayoral Photography Office)

A bureaucratic procedure gone wrong has turned out to be a major headache for Mayor Bill de Blasio that refuses to go away. Even after two recent and damning investigative reports, one city agency maintains its investigation is "ongoing" given newly turned over information and the state Attorney General is still looking into the matter.

The lifting of deed restrictions on Rivington House, a nursing home on the Lower East Side of Manhattan, which allowed the property owner to sell to a luxury condo developer at massive profit, has been scrutinized and criticized over the past several months. Mayor Bill de Blasio has admitted that his administration made a significant mistake, but there have been more questions than answers.

With allegations of impropriety swirling, de Blasio insisted that there was no inappropriate intent, only poor communication and an outdated deed restriction removal process. Two reports on the matter - one each from the city’s Department of Investigation and Comptroller Scott Stringer’s office - sought to answers some of the lingering questions and both painted a picture of City Hall mismanagement, though not criminality. A third investigation, by Attorney General Eric Schneiderman’s office, continues.

But while the DOI did release a report on the Rivington matter, that investigation featured condemnation of City Hall for redacting information and limiting access to computers. Now, after DOI threatened to sue and City Hall granted more access, DOI has indicated that it still has “an ongoing investigation,” according to a spokesperson for DOI, who declined to comment further.

The watchdog agency could issue a follow-up to its report given new information, which, it said in a press release upon receiving the unredacted documents, includes an essential de Blasio administration memo on the Rivington matter.

While DOI continues its Rivington investigation, the Comptroller’s office confirmed to Gotham Gazette that its report on the deal is final and that Comptroller Stringer has nothing else to add at this time.

The two reports mainly criticized City Hall for poor communication with city agencies and allowing the Rivington deal to go through without the proper checks and oversight that would have stopped such a transaction.

The DOI report, released July 14, found a stark absence of accountability in how the city deals with deed changes and a lack of vigilance among city officials who knew of the deal yet did little to ensure adequate public benefit. It stated that City Hall pleaded ignorance of the details despite having been informed at multiple occasions by agency subordinates.

The Comptroller’s report from August 1 was more pointed in assigning blame, stating that though the process could be improved, the problem largely stemmed from failure in execution and communication by city officials.

Both reports showed that First Deputy Mayor Tony Shorris was not overseeing the related deliberations and processes with clarity, and no one from his office was reading reports that contained key information. Neither the DOI report nor Stringer’s report found that Mayor de Blasio was at fault or even aware of the deal.  

That the DOI should consider the matter still open is not surprising. Its report pointed out that it did not receive all the information and documents requested and that the Law Department denied access to computers at City Hall. DOI claimed that “a substantial number of documents” that it did receive were redacted by the Law Department. The report concluded, “Because DOI did not receive a full production of what it requested, it is unclear what Rivington-related information remains on the City Hall servers and computers, to which DOI was denied access.”

A tense back and forth followed, with Mayor de Blasio and the Law Department, led by Corporation Counsel Zachary Carter, at first denying claims that DOI’s investigation was hindered in any way. “There’s been a huge effort made by various elements of the administration to be cooperative and helpful to DOI and obviously the other entities that are investigating,” the mayor said following the release of the report.

“A huge amount of material was provided,” he said. “There was a lot of transparency. The Law Department has a job to do, to make sure things are done the right way. And there’s a natural institutional tension between the two agencies...I’m very convinced that everything was provided that was necessary, and clearly [DOI was] able to come up with a comprehensive report.”

The apparent attempts to obfuscate the investigation have been a separate but related source of criticism to the issues that led to the Rivington mishap, the likes of which de Blasio has pledged will never happen again. In part, he says, because all deed restriction lifts will go through the Mayor’s desk.

A week after DOI’s report, Inspector General Jodi Franzese wrote to Carter asking that the Law Department give them the information and access they were denied in the investigation. "DOI has the exclusive prerogative to determine how it conducts its investigations and what information is relevant to its investigations,” Franzese wrote. “Neither City Hall, Law, nor any other City agency or official is entitled to interfere or refuse to cooperate with a DOI investigation or determine what material is relevant to that investigation."

Five days later, under DOI’s threat of legal action, Carter released thousands of pages of documents and gave DOI access to City Hall computers. One of the crucial pieces of documentation to emerge was a July 2014 memo that showed city officials had reviewed the benefits and possible drawbacks of converting Rivington House to condominiums. (Carter had also redacted a deed restriction waiver for the Harlem Dance Theater in a separate transaction.)

The newly unredacted memo shows detailed consideration of the deed restriction removal and various options for the Rivington property, indicating a good deal of attention from administration officials about the situation. It is the type of deliberation that de Blasio had indicated did not go into the decision to lift the deed restrictions, which he assigned to miscommunication and bad process, which left a lack of scrutiny over whether lifting deed restrictions on any property advance the city's interests.

While DOI says the investigation continues, that does not necessarily mean that it will release additional findings, a new report, or an addendum to its prior report. A DOI spokesperson declined to give indication about what the public could anticipate may come from examination of new information.

Dick Dadey, executive director of Citizens Union, a government reform group, criticized the mayor and the Law Department about their cooperation - or lack thereof - with DOI, insisting that the response to the investigations was the “exact opposite” of what should have happened.

Zachary Carter’s obligation is to the people of New York City rather than the mayor, Dadey said, and that his actions came across as an attempt to protect de Blasio. “There are a lot of questions about this whole process and who is going to be held accountable for the mistakes that were made along the way,” Dadey told Gotham Gazette. “That the corporation counsel’s office now seems to have attempted to conceal needed information from the DOI raises even more questions about the integrity of this investigation and whether or not we will get to the truth about what happened.”

by Samar Khurshid, senior reporter, Gotham Gazette

Read more by this writer.

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

Additional Information Means 'Ongoing Investigation' into Rivington Deal Sun, 21 Aug 2016 04:00:00 +0000