By Michael Musto
By Capt. James Van Thach told to Jonathan Wei
By Kera Bolonik
By Michael Musto
By Nick Pinto
By Steve Weinstein
By Michael Musto
By Michael Musto
Its more a cult than a culture.
As often as we hear how imperative it is to change the culture of Albany, the language of reform camouflages the enemy. A mercenary class of elite lobbyists is at the heart of every state scandal, and nothing will change in New York until their death grip is broken.
Amorphous critiques of the way things are done in Albany do not describe whats killing the state. Its real people, an encrusted caste of 6584 registered lobbyists now awaiting the Albany arrival of Andrew Cuomo. He will either find a way to isolate and disarm them, or he will succumb to their charms, favoring one lobbyist or another until his government, too, is perceived as theirs.
This gang, especially the top hundred heavy hitters, lives by a code of cult-like indifference to the common goodselling relationships with seduced decisionmakers for four-five-and even six-figure monthly fees. They put a pricetag on every hello. They cobble contributions. They push interests as if they are beliefs. They are as likely to be retained to make something go away as they are to make it happen. They engage, ingratiate, invest and convert, carrying the state, one compromising deal at a time, towards fiscal oblivion.
The shadows are their office. They recruit by whisper. As covert as they prefer to be, filing disclosure forms that conceal, they rationalize themselves as necessary intermediaries, the glue of a disjointed government. Its a proselytizing mantra that covers the capital in alibis and allegories.
Albanys lobbyists are, of course, no different than lobbyists elsewhere. That doesnt make them any more compatible with the public good. And with twice as many lobbyists per legislator as the second highest state, they have become the permanent government of New York, like black crows circling the iconic green Capitol dome. The scandals they spark routinely change all the players but them. We are watching that cycle again, as almost every tarnished power center other than the Assembly Democrats, that ultimate bastion of lobbyist collusion, switches hands.
In this season of chilling revelation and electoral tumult, the primetime lobbyists appear set to remain as Albanys most enduring fixture, with a change in revenue rankings but a roster nonetheless largely intact--altered only by the winks and nods among fresh insiders.
This is a memo to Cuomo. If he doesnt take dramatic executive order action in his early days as governor to blunt the sway of lobbyists, they will chip away at his credibility, and voters will come to believe over time that all that has changed are the names of the ins and the outs. He can finance his next campaign without them. He cant restore public faith in state government with them.
A pecking order of the caste closest to Cuomo has already emerged.
John Marino, who chaired the state party for five years under Mario Cuomo and ran three of his campaigns, launched a government affairs unit at his public relations firm, Dan Klores Communications (DKC), last September. Its run by Allison Lee, the wife of Congressman Maurice Hinchey and a former aide to Andrew in his days at HUD under President Clinton. When Cuomo was nominated for governor at the state party convention this May, it was Marino who introduced him.
The founder of the firm, Dan Klores, is so close to Andrew that they used to throw joint birthday parties. Klores, who says hes sold his interest in the firm to Marino and other employees as part of a long-term arrangement, spends most of his time now producing plays and movies, but he was on the phone often in 2003, talking to reporters about Andrews breakup with Kerry Kennedy. He put $101,700 into Cuomos 2006 campaign for attorney general and supplied his campaign press secretary and first communications director in the AGs office. Marino, Klores, Klores wife, and Lee have given $42,500 to Cuomo since January 2008, and their government affairs attracted 10 clients the day they opened, and a total of 27 clients since.
Marino tells the Voice that he aint ever going to lobby the governor or anyone on the executive side, promising to restructure the firm in such a way as to not share in the profits of the government affairs unit. Klores said much the same, indicating that under the terms of his sale, I dont have anything to gain from the firms future lobbying income. That still leaves Lee and others at the firm with their own ties to Cuomo, as well as the allure of the big names at the top of the letterhead.
The interlocking history of DKC and Cuomo put it only half a step ahead of the woman who ran the 2006 campaign, Jennifer Cunningham, who is a partner with John Cordo, a former Republican senate staffer, in Cordo & Co. Cuomo and Cunningham differed over Eric Schneiderman during the primary, when Cunningham was running the campaign of her former husband and Cuomo wanted anyone but Schneiderman to win. But they ended up on the same page (and what a novel it is). Schneidermans stunning win, aided by Andrew, may cement the ties between these three over the coming years. Cunninghams careermaking client is 1199 SEIU United Healthcare Workers, a union Cuomo is at loggerheads with regarding Medicaid costs.
The Cordo firms most recent filing with the states Public Integrity Commission lists Cunningham and Cordo as the new lobbyists for Genting, the Asian gaming company that won the scandal-ridden and extraordinarily lucrative Aqueduct casino contract. SKDKnickerbocker , a public relations firm where Cunningham also works, is now also handling press inquiries for Genting, an indication, perhaps, that the big spenders can smell the perfume.
Chris Del Giudice, the son of Mario Cuomos former secretary and Andrews current top policy adviser, Mike Del Giudice, recently joined Wilson Elser, the firm that always takes first place in the New York Public Interest Groups annual revenue and campaign contribution rankings. So did Jerry Jennings, the son of Albanys mayor, another reliable Cuomo ally. Wilson Elser, which hosted two receptions for Cuomo since 2008 and gave $68,856 to him, did an intimate fundraiser for him last fall in the ninth-floor conference room at its Albany office. Then Cuomo went to the Fort Orange Club, the gothic, wood-paneled, male-and-pale deal mausoleum, where he was introduced by the senior Jennings to an overflowing crowd of handlers and wirepullers.
In fact, its stunning how many leftovers from the Mario days are lobbyists and major Andrew donors nowTonio Burgos, Jerry Weiss, Rick Ostroff, Pat Brown and his partner, David Weinraub. James Featherstonhaugh, the legendary 66-year-old dean of Albany lobbyists who represented Mario Cuomo personally in civil litigation, and was subsequently represented by Marios law firm, has taken on an Andrew aide, Frank Hoare, as a new partner. Burgos was Marios appointments secretary, and Weiss created the law firm Andrew ended up joining. Brown was a highly respected senior counsel to Mario Cuomo for many years. Weinraub and Ostroff, now at competing lobbying firms, ran intergovernmental affairs for Mario. This pack from the past combined to donate $213,080 to Andrews coffers since 2008.
Charlie King, the former top aide to Andrew at HUD who took a leave from his own two small lobbying outfits to serve as Cuomos executive director of the state party during this campaign, may return to his companies or to Bolton St. Johns, one of the states premier firms where he once worked. King was Andrews running mate in his failed 2002 bid for governor, and partnered for years with Al Sharpton, who has functioned as a lobbyist in David Patersons Albany without registering as one, collecting hundreds of thousands in state-connected donations to the National Action Network that he and King ran. King is a Cuomo and Sharpton loyalist, well positioned to become one of Albanys most significant minority lobbyists.
The other Al, former Republican senator Al DAmato, has tried to position himself as a key Cuomo ally, denouncing Carl Paladino as not fit to serve at the outset of the general election campaign. DAmato sees himself as the kingmaker in picking the next GOP state chair after the election, and as an intermediary between Cuomo and the new Senate Republican majority. He hung on to his Republican credentials by loudly championing Dan Donovan, the partys losing candidate for attorney general, even as he embraced Cuomo and Kirsten Gillibrand, the Democratic senator whose father, Doug Rutnik, is an Albany lobbyist himself and a longtime DAmato and Featherstonhaugh sidekick.
DAmato recruited former Staten Island Congressman Vito Fossella as a new partner in his Park Strategies lobbying firm at the same time that Fossella was featuring Paladino, rather than Rick Lazio, at a pre-primary rally in Staten Island against the so-called Ground Zero mosque. That September 11 appearance, combined with the timing of DAmatos post-primary denunciations of Paladino, may be the best indicators that Cuomo wanted to face Paladino, a deck DAmato helped stack.
When DAmato was in the senate and was the states official top Republican, and Mario Cuomo was the states top Democrat, the two had what Senator Patrick Moynihan called a nonaggression pact, with DAmato serving up weak Republican challengers for governor in 1986 and 1990. As the unofficial leader of the party now, whose connections help bankroll it, DAmato may hope to use that leverage to establish a similar tie to the son.
The DAmato firms stable of prominent Republicans includes the son of Congressman Peter King (a potential formidable Cuomo opponent), the ex- Erie County executive Joel Giambra, and Fossella, whose career was undercut by the DUI-related revelations of a second, Washington-area, family. While DAmato, who was once famously paid $500,000 for a single call to a state official, is not listed as a Cuomo donor. But his partners gave $9000, and DAmato hosted a Cuomo fundraiser. DAmato has also long been closely tied to another lobbying firm, Mercury Public Affairs, and one of its principals, Michael McKeon, ran Cuomos outreach effort to Republicans.
Mel Miller, the former Democratic Assembly speaker, recently joined DAmatos firm as special counsel. Miller sold his firm, Bolton St. Johns, to the staff a couple of years ago. Hed already established a strong DAmato relationship by recruiting Armand DAmato, the senators brother, as Boltons general counsel years earlier. Armand left Bolton to join Park Strategies in 2004, and now the DAmatos have returned the favor.
Who cares that the Senate Ethics Committee found in 1991 that Al DAmato had allowed his lobbyist brother to use his office stationery to solicit multimillion- dollar Navy contracts for a client? Who cares that Miller and Armand were convicted in unrelated federal trials in the 1990s, only to have their convictions overturned on appeal? In Albany, overturned convictions can be selling points.
In the days immediately following Millers 1991 conviction and automatic expulsion from the assembly, he told reporters that he was moving on to a new phase in his life and didnt expect to do jail time for stealing $300,000 from his law clients. Maybe Ill make some real money now, the then 52-year-old Miller said. Having spent a lifetime watching other lobbyists at the Albany trough, Millers on-the-mark prediction hardly made him a prophet.
Cuomo will be inaugurated on the darkest of Albany days, and its not just the budget thats broken.
Three scandals as large as any in my lifetime haunt the capital, and each is a tale of lobbyists at their not so menial but very venal labor.
Republicans may have just retaken the state senate, even though their longtime majority leader, Joe Bruno, was convicted of federal felonies less than a year ago. If the GOP won, they did so, in part, by hanging a new, lobbyist-laden, scandal--the award of the $3 billion, 30-year racino franchise at Aqueduct--around the necks of Brunos Democratic successors, Malcolm Smith and John Sampson.
Bruno was caught mimicking the lobbyists that owned him, taking $3.2 million in consultant fees to steer union pension and state funds to his clients, though the media subordinated his proven criminal enterprise this fall to fresher Aqueduct headlines about still-unproven Democratic offenses. As tawdry as Smith and Sampson appear in the Aqueduct saga, they are boy scouts compared to Bruno, whose trial record depicted a breathtaking criminal enterprise.
One former counsel to Bruno, Kenneth Riddett, testified that he instructed GOP senators to have their financial disclosure forms hand-delivered to the ethics commission as a way of avoiding federal mail fraud statutes. By the time he testified, Riddett had his own lobbying shop, starting off with the Trial Lawyers Association, a Democratic stronghold in search of a Republican ally. It has long been legend that the GOP senate, much like Tom Delays House, pointed petitioners at their door to designated lobbyists, like a setter aiming its muzzle at game.
Lobbyists like Featherstonhaugh also made appearances on the witness stand. Feathers, as he is called, never bothers to dust a story up. He sees nothing wrong with being in a real estate partnership with the Senate leader he lobbies, Joe Bruno, or his brother Peter, or representing the Bruno family business, or doing a land deal with Brunos son, Kenny, or hiring Kenny as a lobbyist in his firm. (Kenny Bruno went on to Wilson Elser and then to his own lobbying firm, where he was clearing $50,000 a month.)
Feathers testified that he introduced the senator to a partner in a local investment firm because the businessman wanted to see if he could enter into some kind of relationship with Bruno, which he did, retaining the senator as a consultant. Then Featherss friend introduced Bruno to another businessman, who also retained him, giving birth to the business that ultimately convicted Bruno. Lobbyist John Cordo, who once worked for Feathers and was treated like a son by Bruno, also testified, confirming that a pivotal bill he handled granting correction officers some of the same pension benefits as police officers and firefighters was only passed after the correction union invested in a Bruno-tied investment firm, though he claimed he didnt know Bruno was a consultant to the firm.
I would see Joe socially, Feathers recalled, unconsciously defining the art of the Albany schmooze. He would talk primarily about his back swing and what trail he was going to ski. Those were our two big conversations. Feathers wasnt shy about saying what bored Bruno, either, simultaneously debunking the three-in-a-room decision-making legend, insisting that it was more like six-to-seven in a room, counting counsels. Leaders would not even know about some legislation, he testified, adding: I'm sorry for that senator.
Bruno didnt testify, saving his long-winded declaration of innocence for the sentencing judge in May. How dare anyone say Im not worth $20,000 a month? the lobbyist senator wailed, incensed by the testimony of one client who said Bruno did no work. I know consultants that get paid $50,000 a month for doing what I was doing.
It is a bipartisan whine, with Bruno echoing a Democratic assemblyman, Anthony Seminerio, who was convicted, like Bruno, of lobbyist envy. I was doing favors for these sons of bitches there, Seminerio told another convicted assemblyman in a secretly taped conversation. They were making thousands. So, said Seminerio, he decided, Screw youfrom now on, Im the consultant. Bruno explained, without a clause of contrition at his sentencing hearing: I watched people on the outside who had been in leadership positions earning millions of dollars a year.
So he tried it from the inside. A month after he stepped down from the senate in 2008, and shortly before he was indicted, Joe Bruno, 80, registered as a lobbyist for CMA Consulting, a company run by the widow of a former state senator with tens of millions in state contracts. It was not a late second career.
I looked at whats going on up on that hill, said U.S. District Court Judge Gary Sharpe as he sentenced Bruno to two years in prison, and I just shook my head.
Inspector General Joseph Fischs 308-page report, released a week before election day, focused on the locusts of lobbyists that descended on Senate Democratic leaders to win the Aqueduct contract, the largest in state history. The report only briefly notes that it was Bruno who insisted that the franchise be awarded like none other, empowering the two legislative leaders to exercise executive power and pick the winner, together with the governor.
Leave it to Feathers to attest to what the IG report said was a common sentiment. He testified that the unusual arrangement came from my friend Joe Brunos insistence, tied no doubt to the fact that Brunos son Kenny was representing Capital Play, an early bidder that evolved into Aqueduct Entertainment Group (AEG). Feathers himself was a principal in another bidder that won the contract in late 2008, shortly after Bruno resigned as leader, only to forfeit it when Featherss partners couldnt come up with the upfront multimillion-dollar fee it agreed to pay. The majority leader was acting again as a lobbyist, this time for the horseracing interests he was so identified with, starting with his own son and Feathers.
Fisch told the Voice that the awarding of this contract to AEG was a tribute to the unbridled power of lobbyists. While AEG competitors, said Fisch, had the financial resources, experience and the support of the licensing and financial professionals, AEG had the right lobbyists. That, he concludes, proved to be all they needed.
Two of the lobbyists accused in the IG report of fixing the Democratic senate - Carl Andrews and Hank Sheinkopf - flouted the probe, with Andrews unsuccessfully suing to block subpoenas and appealing right up to the reports release, and Sheinkopf taking the fifth amendment. Incredibly, their refusal to cooperate with a state probe of the award of one state contract has no effect on their ability to seek another. There are no qualifications or standards for this job, and you can keep it even if the states Public Integrity Commission (PIC) finds that you violated the lobbying laws. All you have to do is find a client willing to pay you.
Andrews hosted a victory dinner in his Albany house right after AEG won the bid, and Smith and Sampson and five other legislators, including Manhattan county leader Keith Wright, joined company brass at an event Andrews invoiced for $1,562. The night before Governor Paterson announced the award, Andrews and AEG executives lit a victory cigar at the Havana Club with Al Sharpton, whose NAN had just collected $100,000 in AEG contributions, ostensibly tied to their belief that the Rev was whispering to Paterson on their behalf. A former state senator himself, Andrews held a top executive title in the Spitzer and Paterson administrations until a scandal about his apparent efforts to influence a decision of the State Liquor Authority forced him from office (the IG eventually concluded that Andrews top aide had to be fired).
But, like Mel Miller and others in Albany, Andrews has found that scandal can be a stepping stone, prospering even after his mentor, Brooklyn Democratic boss and assemblyman Clarence Norman, was convicted in three separate felony cases. Andrews attracted clients like AEG from the moment he threw up a shingle in 2009, also recruiting A.L. Eastmond & Sons, the Bronx boiler firm that allegedly paid City Councilman Larry Seabrook $50,000 to rig a Yankee Stadium subcontract. He also represents the Marcus Garvey Nursing Home, a much-probed, state-supported, Brooklyn residence that remained the biggest giver to Normans re-election committee in 2009, four years after he surrendered his assembly post.
Charged by the IG with getting a confidential senate memo from Sampson and playing a key role in tilting Sampson in AEGs direction, Andrews relationship with Sampson is described by the IG as a wellspring of ethical issues. E-mails from AEG executives revealed that a day after Andrews got the secret memo comparing bids, they decided to boost his monthly stipend by $2,500 to $10,000, calling him our most important of seven lobbyists. But they also decided to pay him only half of the amount he was due right away. By delaying payment #2, one executive wrote, referring to a second $10,000 stipend, he cant release the senate. It is such a statement of perceived power that Andrews, who has survived so many grand juries he may think theyre grand, is apparently trying again to wait out this storm as well and perhaps turn the findings into a flyer for his services.
Sheinkopf copped a memo, too, obtaining it from an aide to the top Senate staffer, Angelo Aponte, who Sheinkopf personally installed in the key spot. He had the power to do that because the skillful Sheinkopf doubles as a lobbyist and as a political consultant, and had advised Senate Democrats in the elections that led to the 2008 majority, helping to make Malcolm Smith majority leader. Sheinkopf collected $356,741 in consulting fees from the Senate Democratic Campaign Committee at the same time that he was representing AEG and its precursor with Senate Democrats. Having worked for Bill Thompson and Mike Bloomberg most recently, Sheinkopf makes kings so he can then make deals with the kings hes made. He became a regular on CNN over recent years, appearing as an expert so often he started to believe he was one.
More than 20 years ago, Sheinkopf handled the first successful campaign for Rob Johnson, who is still the Bronx District Attorney. Johnson beat Phil Foglia, the author of the IG report, after a top Foglia associate reportedly tried, unsuccessfully, to get Sheinkopf to do Foglias campaign. That may make this report the first time Sheinkopfs two hats have, over time, become too many to wear, especially when caught in a headwind like AEG. Fisch, oddly, recused himself on this investigation because of his ties to Paterson, who participated in the AEG selection, but took center stage at the press conference unveiling it-an unusual combination.
Foglia, who is so Republican he was picked in 2007 to be the Bronx partys commissioner on the NYC Board of Elections, has failed in a couple of electoral runs, but his well-timed report may have delivered the GOP its biggest 2010 win. Foglia told the Voice that his BOE nomination was stalled by politics and that he became a Republican in the late 90s, running as one for City Council in 2005. The Foglia ties suggest that even a report that gets the Democratic Senate side of a scandal right can, by going light on Senate Republicans and Assembly Democrats, still be a well-timed partisan contract in Albany.
The report quotes another AEG lobbyist, the ubiquitous Cordo, as defending the illicit receipt of the two memos: All I care about is the information, not where it came from. His reasoning? This is lobbying, he explained, which the IG concluded was a clear statement of why lobbyists were antithetical to an objective procurement process, unconcerned about rigging it.
Also prominent in orchestrating the award were Bolton St. Johns and two other lobbyists closely associated with Sheinkopf--Norman Levy, who was Sheinkopfs best man AT his wedding, and Stanley Schlein, a fixer tied to the one-man Senate crime wave, Pedro Espada, who was fined $15,000 in 2008 by the citys Conflict of Interests Board. Schlein told the IG he didnt register as an AEG lobbyist because he was functioning as their counsel, though, said the report, others testified that he played a role as a lobbyist.
Manhattan U.S. Attorney Preet Bharara has been investigating the aqueduct deal all year, as he has the simultaneous $50 million voting machine contract awarded by the city election board to a company, Election Systems & Software (ES&S), also represented by Sheinkopf and Levy. NYPIRG listings showed that Sheinkopf had the third largest increase in compensation between 2008 and 2009, while Levy was ninth.
Schlein was on the opposite side of the voting machine competition, representing the losing company thats now suing. One source said Schlein was working with John Haggerty, the Republican consultant under indictment for stealing a million in campaign funds from Mayor Bloomberg and a recent top aide to Carl Paladino. Haggerty, who was said to have periodically appeared at the board, did not file as a lobbyist on the deal.
A lobbyist working with Sheinkopf and Levy for ES&S, Anthony Mangone, was arrested by the feds on unrelated bribery charges the day after the January board decision. Jay Savino, the Bronx Republican county leader who nominated Foglia to be the partys commissioner on the Board of Elections, shares an office suite with Mangone and has already been subpoenaed in the case, just one more way these incestuous circles swirl. Foglia says his relationship with Savino is cordial.
Cuomo learned firsthand how pernicious the Albany lobbying game is with his investigation of the other great scandal of the past four yearsthe looting of the states pension fund. Some of the same lobbyists that are tied to AEG made appearances in this clammy chronicle as well.
Norman Levy received a half-million dollars in 2006 payments from Bill Howell, a major pension fund placement agent, and appeared sometimes to be Howells partner in controversial deals with the fund, according to a source familiar with the transactions. Investigators concluded that they were splitting fees, and not disclosing it. The payments to Levy - whose conviction for running a parking-ticket-fixing-scam decades ago was also overturned on appeal - were allegedly tied to his introduction of Howell to a principal of Global Strategies, a consulting firm whose client, Intermedia, was seeking millions in city and state pension fund investments. Howell made the placements and shared the fees with Levy, who appeared to be listed as an employee of one Howell entity. Sheinkopf received payments from Levy shortly after Levy was paid by Howell.
Howell also paid former Liberal Party boss and notoriously influential lobbyist Ray Harding another half-million. Unlike Howell and Levy, Harding was indicted on charges associated with these and other payments. In his guilty plea, Harding refers to the payments Howell made to him and concedes he did nothing to earn them.
The comptroller at the time, Alan Hevesi, just pled guilty to taking a million in bribes from Markstone Capital Partners, one of the companies that looted the fund, and $380,000 of that total took the form of a fee paid to Frank Sanzillo, a lobbyist whose brother was Hevesis top deputy. The fee was funneled through Hank Morris, the lynchpin of the pension racket. Hevesis only attempt at an explanation for steering the payments to Sanzillo is that he was a political supporter of mine. Sanzillo, who has not been charged, is another of the AEG lobbyists named in the IG report, though he got out quickly after a two-month retainer. He and Carl Andrews share several clients and are listed as pitching in together when the Senate Democrats buy golf balls for their outing.
Other lobbyists like onetime Bronx assemblyman Roberto Ramirez and former Republican assembly leader John Faso have also been implicated in the pension scandal. The only reason more havent been is because Hevesi - and his successor, Tom DiNapoli - decided to continue a policy that exempted lobbyists dealing with the fund from registering or filing as lobbyists. A memo that DiNapolis lawyers sent to the Public Integrity Commission in July 2009 distinguished the pension fund from other governmental entities, contending it was not a state asset and thus not subject to state procurement policies, including those regulating lobbyists. Hevesi took a similar position in 2002, shortly after he was elected.
More disclosure and tighter reins wont begin to break the cult. Andrew Cuomo has to move in a wholly new direction, creating an office of lobbying relations that will become the only passageway onto his second floor for lobbying information, which is sometimes informed and helpful. This filter will be staffed by technocrats who think of birds when they hear someone mention feathers. The unit will be staffed not on the basis of who they know, but who they dont know. Once this ban on direct contacts with decisionmakers is extended to all state agencies, Cuomo may have set an example that the senate and assembly will have to emulate.
I ran this remedy past Blair Horner, the New York Public Interest Group lobbyist who is the ethics watchdog of Albany and once worked for Cuomo. Horner sees all kinds of practical difficulties, fearing bottlenecks and other logistical questions, but says it could work. He thinks it should be tested out in a pilot project.
Of course, the danger of anything piecemeal is that the Big Boys could set in motion a new pattern of Cuomo seduction before the wholesale innovation gets off the ground, and, thus, radical change would never occur. Feathers blasted the idea as naïve, and said the generalists Cuomo put in the unit would know us all in two weeks.
Its not just the state that would be protected by erecting these walls. Its Cuomo himself. If he falls into the get-along ways of the lobbying caste, just changing the seating arrangement at the head table, he will become the main course. And New York, the love of his familys life, will sink deeper into its swamp of cynicism.
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