Too Smart by Half

How Spitzer rigged the build-up to the war with the assembly

Ever-young Pete Grannis, the still-blond golden boy of the assembly who's represented the eastside of Manhattan for 32 years, got back to his Albany office midway through the day on January 23. He'd just finished making his pitch to become state comptroller before the three-member screening panel selected by the governor and the legislature, as well as the finance committees of the senate and assembly.

The 65-year-old onetime tax lawyer thought he'd made his case well—28 years on the Ways & Means committee, a member of the Joint Budget Conference Committee, a lifetime, as he described it at the hearing, of "immersion in the substance of state financial matters." Noting that there was "no more appropriate place" for an independent reformer like him "than the comptroller's office," Grannis had just finished testifying that his selection would be "the natural evolution of what I have been doing for the past 30 years."

Then the phone rang.

"As soon I came back, an aide to the governor called," Grannis later told the Voice. The aide "said the governor would like to offer you the job of Department of Environmental Conservation (DEC) commissioner." Grannis was stunned. "I didn't put in an application. I didn't ask anyone to advance my name. I didn't even know I was under consideration."

The chairman of the assembly's insurance committee for 14 years, Grannis had worked with Spitzer and some of his top staff during the attorney general's 2005 battle with major insurers and brokers, uncovering "collusion, fraud, and market manipulation." He and Spitzer had developed what Grannis called a "professional, not personal" relationship. He'd even spoken, ever so briefly, to the governor about the environmental job on January 2, the day after Spitzer took office.

Spitzer was trying then to talk him out of seeking the comptroller's post, contending that a finance manager, not a legislator, should be named. In a fleeting fashion at the end of the meeting, as Grannis recalled it, he told Spitzer that he would consider the DEC appointment. The governor simply said "that's very interesting." When Spitzer failed in the ensuing three weeks to raise the subject again, Grannis assumed the idea was dead.

He had some reason to think DEC was a good fit for him. He'd started his public career in the early '70s as an attorney at the agency. Since then, he'd been such an activist environmental legislator that several of the leading green groups had honored him. But his focus in recent years had been elsewhere, and he'd consciously chosen not to go before the transition committee set up by Spitzer to select DEC's new commissioner. That transition committee, chaired by Syracuse lawyer John Murad, had by and large finished its work back in December, interviewing several top candidates and reaching out widely to their references. In January, the state police were busily conducting background investigations of at least one finalist, contacting people who knew him. Joe Martens of the Open Space Institute, attorney Michael Gerard, former New Jersey environmental commissioner Brad Campbell, and Judy Enck, an environmental aide to Spitzer in the attorney general's office were among those interviewed.

Confronted that afternoon with a concrete offer, Grannis told Spitzer's aide he would get back to him. He slept on it. The next morning, he sat in his office and watched the second day of comptroller candidates appear on camera, studying the competition. He thought his fellow assemblyman, Tom DiNapoli, did well. From the beginning of the comptroller sweepstakes in December, DiNapoli, a popular legislator close to Speaker Shelly Silver, was seen as the assembly's favorite candidate. DiNapoli's inside track, which ultimately led to his recent selection, was one of the factors pushing Grannis toward accepting Spitzer's tantalizing offer.

That afternoon, he decided to take the DEC job and pull out of the comptroller race. On Thursday morning, as the screening panel met to make their final recommendations, Grannis's DEC appointment was announced. The panel—consisting of ex-comptrollers Carl McCall, Jay Goldin and Ned Regan—then made the controversial decision to submit only three names to the legislature, which always had the constitutional authority to decide who would fill the recently vacated shoes of convicted comptroller, Alan Hevesi. None of the five assemblymen who appeared before the panel was selected.

"Pete would have come out," one member of the panel told the Voice. "Just before we started the deliberations, we got this call and we were told that Pete was out. He was appointed as we met. We talked about Pete and we had positive feelings about him." This member, who asked not to be named, said he and a second member agreed that "Pete would have made the list." Grannis says he had no way of knowing that, nor did he know that the panel would decide so quickly and that all he had to do was wait a few hours to find out if it had recommended him. He insists that Spitzer "did not pressure" him for an immediate answer, but that he simply decided DEC was "a premier job offer that trumped the comptroller position."

"The timing was bad," Grannis acknowledges, adding that he "believes" he got messages from Spitzer's aide as he paced outside the hearing that morning, nervously anticipating his appearance and unable to take a call. He said that Spitzer's office told him they had decided to give him the job "over the weekend," but failed to make contact until after he formally entered the comptroller competition.

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