Money in Politics in New York: September 21 edition

Gambling Industry Donates Millions to New York Politicians
As Governor Andrew Cuomo and the New York State Legislature discuss the process of amending the State Constitution to allow up to seven new full-scale, privately owned casinos in New York, the gambling industry is funneling millions of dollars into lobbying efforts and campaign war chests. Indian tribes, racetrack casinos and other gambling interests have spent nearly $50 million since 2005—over $40 million on lobbying and roughly $7.1 million on campaign contributions—according to a new report by Common Cause. Nearly $4 million of this has gone to New York Senate and Assembly races. “Gambling interests are betting big and spending millions in advance of a potential billion-dollar pay out. New York’s sky-high contribution limits, LLC loophole, and unlimited contributions to soft money accounts means the deck is stacked against the average voter” Susan Lerner, executive director at Common Cause, stated. “We need campaign finance reform to assure the public that the state’s future won’t be decided in a high stakes game where the dealer always wins,” she added.
Congressmen Warn Schneiderman Not to Investigate Outside Groups
Earlier this year, New York State Attorney General pledged that he would investigate non-profit “social welfare” organizations that have been channeling millions of dollars into political campaigns for potentially violating their tax-exempt status, which dictates that they cannot have political campaigning as their primary purpose.  Representative Dave Camp (R-MI) and Senator Orrin Hatch (R-UT) released a letter warning Schneiderman that his attempt to obtain tax information from 501(c)(4) groups could violate federal privacy laws. “We emphasize strongly that willful unauthorized disclosure of returns or return information is a federal crime subject to fines and/or imprisonment,” the letter alleged. The Attorney General’s Office defended its request for the tax records, arguing that New York has the right to examine fraud and state tax evasion, and further asserting that the Attorney General is aware of the proper procedures for proceeding with the inquiry.
2011 Ethics Legislation Riddled With Loopholes and Complications
An op-ed in the New York Times from early September attributed ethical mishaps in Albany to the part-time nature of the legislative position. “Because these ‘citizen lawmakers’ work only a few days a week, they also are permitted to have lucrative day jobs — including anything from broad consulting or legal work to key roles at companies or organizations that may benefit directly from the legislative activity in Albany.” The author credits Governor Cuomo for signing importantreform legislation back in June that requires legislators to disclose their outside income and creates an independent monitor to help investigate breaches. However as Kelly Williams, corporate general counsel at the Brennan Center, explains in a letter to the editor the ethics law does not go far enough. “Lawmakers must disclose only their new clients, or new business with existing clients after July 2012 — and only those clients for whom the lawmaker personally and directly performed state business, like negotiating a contract with a state agency in an amount greater than $50,000 or obtaining a grant greater than $25,000 through legislative initiative.” These complicated procedures and loopholes necessitate that more must be done to ensure ethical behavior on the part of our lawmakers.

Money in Politics in New York: September 14 Edition

Corporations Use Limited Liability Companies to Skirt Campaign Contribution Limits
Limited Liability Companies associated with luxury real estate mogul Leonard Litwin have channeled more than $900,000 into races for the New York State Senate this election cycle, largely to Republicans seeking to hold on to majority control. These LLCs have also contributed nearly $100,000 to at least 18 candidates for the State Assembly. Although the state caps political donations to $150,000 for individuals and $5,000 for corporations, an LLC is treated like an individual, allowing these entities to donate up to $150,000 annually. Furthermore, the process of forming an LLC is simple; any person or business can create an LLC by mailing a short form to the Department of State with a $200 fee. Companies can fashion numerous LLC’s in order to funnel donations above the legal limit for a single corporation. According to Adam Skaggs, senior counsel at the Brennan Center, “It’s a loophole that absolutely should be a high priority if you want to apply meaningful limits on how much you want to donate to candidates.” Employing LLCs to circumvent the law can also disguise the source of contributions since LLCs are only required to provide the name of a “registered agent”—an attorney or a firm that processes corporate registrations—rather than the actual parent company.
Super PACs Gear Up in Long Island Swing District
Super PACs are becoming increasingly involved in political contests in New York. Prosperity First is a new Super PAC in eastern Long Island that is backed by $500,000 from Robert Mercer, CEO of the hedge fund Renaissance Technologies. It has already run $294,000 worth of ads supporting Republican businessman Randy Altschuler in his bid for Congress against current incumbent Democrat Tim Bishop of the 1 Congressional District. Renaissance Technologies spent $1.05 million in 2011 and 2012 lobbying against the Dodd-Frank bill and proposals to increase the capital gains tax on Capitol Hill. The 2010 election contest between Altschuler and Bishop was extremely close with 600 votes out of 200,000 throwing the race to Bishop. Consequently Super PACs could have a significant impact on House races such as this. Similarly the Democrat-leaning House Majority Super PAC has been active in other districts in New York targeting Republican Representatives Chris Gibson, Michael Grimm, Nan Hayworth and Ann Marie Buerkle. House Majority PAC has raised $1 million for New York Congressional races thus far, and plans to spend $6 million in the state by Election Day.

Good Progressive Governments Embrace Technology for Civic Benefit

“Good progressive leadership, good progressive government can change lives with the stroke of a pen and do a lot of good.”
Lt. Gov. Bob Duffy to reporters at Democratic National Convention.

Great quote by Lt. Governor Duffy. We agree wholeheartedly. Like Governor Cuomo and his team, we would like to see New York State government held up as an example of innovative thinking and doing, instead of scandal and backroom dealings.  Governor Cuomo is eager to leave the bad old days of dysfunction behind. One way he do that is by using the the Information Revolution that is transforming American business and society to transform everyday governance and government. Then candidate for governor Andrew Cuomo put forth an audacious plan in his Cleaning Up Albany campaign book to just that. Cuomo’s OpenNY plan outlined a world class program to use Information Technology to make New York government work better, faster and more transparently for New Yorkers.  Candidate Cuomo’s plan is a good one.  Now it’s time for governor Cuomo to use it.