Dominick Carter, the cuddly inquisitor on NY1, went after one of his own recently, grilling former senator and forever fixer Al D’Amato on Wiseguys, the show that regularly features the Fonz, Ed Koch, and Mark Green. Paid to comment on the news, D’Amato had become the news himself, and Carter had to ask him about the $500,000 he was paid to lobby MTA officials in connection with the authority’s catastrophically expensive new headquarters.
“My fee was $500,000,” acknowledged D’Amato, explaining that “a financial institution” that was completing a $230 million refinancing of the building paid him. “I did call. And indeed we were able to get the process moving so that some of the encumbrances to the sale were removed. But that’s a fact. Yes. And I do that.”
“But Senator,” dogged Dominick continued, “$500,000 for one telephone call?”
“Uh, I didn’t set the fee. The people came to me and set it. And, yes, indeed, I’ve made $13 million for putting together two different companies. And that’s what I do.”
Fifteen years ago, when U.S. Attorney Rudy Giuliani asked Stanley Friedman, the state’s most powerful Democratic boss, if he’d made $10,000 for two phone calls, arranging a city lease for a client, Friedman snapped that it was for one call, a boast that pushed the jury to convict him. Despite Alan Greenspan, that’s how badly inflated the price of influence is.
But D’Amato did not stop with his own boast of a $13 million fee. He wanted to show how open he was about his insider hustling and, even without a question from Carter about the collapse of the lobbying bill in Albany just four days earlier, he launched into a cynical cheer for reform. “I have no objection,” he declared. “I have no problem if the state wants to cover—and the legislature in their wisdom—outside agencies like the MTA, and say that if you do lobby that you’ll have to report that. No problem.” Pointing out that he discloses his clients under the current law—which only applies to legislative acts—D’Amato said, “If they see fit to expand it, then so be it, and I’ll comport with the law.”
The camera did not catch D’Amato winking, but he might as well have. His good friends in Albany, George Pataki and Joe Bruno, handpicked for their current posts by D’Amato back in 1994, had sabotaged reform just in time for D’Amato to endorse it. They combined to kill a bill that Frank Padavan, a Republican state senator from Queens, and Pete Grannis, the Manhattan assemblyman, had essentially agreed on, ostensibly with the support of their respective leaders. Both told the Voice that their bill explicitly covered the infamous D’Amato call.
But at 4 a.m. on June 20, Pataki suddenly pulled a poison pill substitute out of the air, and put it out on the floor of the senate. Cluttered with loopholes and caveats, the bill arguably would not have required disclosure of the D’Amato bonanza, especially with its language exempting “vendor disputes,” which is precisely what led to D’Amato’s fee. Indeed, since the Pataki bill only restricted lobbying of “state agencies”—unlike the Grannis bill’s reach to “any action by any public official”—it’s unclear if authorities like the MTA were included at all. But even if D’Amato’s call was covered by the Pataki bill—and Republicans like Padavan say he’s not sure it was—the bill was designed to kill reform efforts and it inevitably did.
Pataki’s bill would have undermined the lobbying commission, forcing wholesale changes in a body that has aggressively enforced the limited laws that exist and adding the requirement that the new commission, with twice as many gubernatorial appointees, had to establish “intentionality” to penalize lobbyists who violate the statute. It also would have introduced the worthy but unconnected issue of judicial reform, putting an army of Pataki appointees in charge of a task force to study it. In other words, the bill was written to dislodge a better one, and was so haphazardly put together that its sudden sponsor, John Flanagan, the newest state senator from Long Island, was forced to handwrite a legal memo explaining it on the senate floor.
Bruno, who overthrew the prior majority leader after another series of well-reported D’Amato calls, was in such a rush he was forced temporarily to withdraw the surprise Pataki bill at around 4:30 a.m. after Democrat Liz Krueger raised a point of order. Once Krueger reminded the senator who was serving as acting president that “rules require a sponsor’s memo be available,” the president said that it was his “understanding that there is a memo as a work in progress on the bill.” Finally Bruno asked that the bill be “laid aside temporarily” while Flanagan scribbled out a virtually incoherent memo.
With the bill brought back around 5 a.m. as virtually the last bill of the senate’s 2003 session, Flanagan stumbled through several Krueger questions. He conceded that the bill was “a little more limited in scope” than the Grannis bill, which had already passed the assembly, conceding that it did not cover, for example, lobbying that was connected to executive orders. Having already announced that the senate was going home that morning, Bruno’s rebuff of the Grannis bill and passage of its Pataki substitute finished lobbying reform until the 2004 session, or possibly a special session this fall. By the time D’Amato made his on-air endorsement, it was already clear he could keep on dialing secretly for dollars for another few months.
Don’t expect Pataki or Bruno to confess that they and their mentor Alfonse had a good laugh together over the fiasco. But one measure of how orchestrated it may well have been was the testimony in early June of Peter Kalikow, the developer who’s now MTA chair, at an assembly hearing called by Richard Brodsky, whose investigation put D’Amato’s fee center stage. Kalikow, who is so close to D’Amato that he used Kalikow’s Manhattan apartment as his legal address when he entered the Senate in 1981, rejected Brodsky’s attempts to get him to criticize the D’Amato call or support lobbying reform.
“I don’t know what the facts are,” said Kalikow, who was D’Amato’s finance chair throughout the Senate years. “But I can’t just say that $500,000 is wrong because we have to decide what it gets for us. We spend much more than that in litigation fees.” As usual, the two lifelong friends were on precisely the same page. On NY1, the only defense D’Amato offered was that his fee might’ve saved the MTA from “a very costly suit” that would’ve “cost the MTA a lot of money.”
Every time Brodsky tried to get Kalikow to back any specific lobbying reform, the cagey Kalikow would duck and weave, saying things like “I don’t know whether this becomes more cumbersome than the problem it needs to solve.” Asked about making contingency fees like D’Amato’s illegal—80 percent of his half-million-dollar fee was paid as a bonus because he got the MTA to back off its objections to the refinancing—Kalikow said, “Coming from the business world, I think people should be rewarded for success.”
Brodsky revealed that the MTA’s own reorganization bill has a brief disclosure requirement, followed by “30 lines of exceptions,” and that Kalikow’s staff conceded it would not cover the Alfonse call. Since D’Amato’s lobbying firm is a tenant at 101 Park—the office tower Kalikow owns and works out of—it’s pretty hard to imagine that they never discussed D’Amato’s supposed commitment to lobbying disclosure, but maybe the two old friends just disagree.
Padavan, a straight arrow on this issue whose proposed reforms have been even stronger than the assembly’s, told the Voice that he believes the senate would’ve passed his bill had it ever come to the floor. He delicately tries to take seriously Pataki’s interest in judicial reform but says he “would’ve liked to see the governor take my bill and tie it into judicial reform,” adding, “I don’t know why he didn’t do that.”
Maybe because it might’ve become law.
Research assistance: Michael Anstendig, Zoe Alsop, Ross Goldberg, Phineas Lambert, Naomi Lindt, Brittany Schaeffer, and Jessica Silver-Greenberg