Money in Politics in NY: Aug. 30 Edition

Op-ed by Susan Lerner Asks NYC Council to Support Disclosure
An op-ed by Susan Lerner, the executive director of Common Cause/NY,appeared in the Daily News this Wednesday asking the New York City Council to bring greater transparency to the city elections process. New York City voters this year are facing a plethora of advertisements and mailings from outside special interests hoping to swing the upcoming elections in their favor. Following the U.S. Supreme Court’s Citizen United decision, corporations and unions are free to spend unlimited amounts of funds garnered from mega donations to boost their preferred candidates. For example, Jobs for New York, a group representing real estate interests, has spent $167,341 in support of Sara Gonzalez’s run for the 38th City Council district – an amount two times greater than what Gonzalez has spent herself. Jobs for New York has received more than $6 million from 116 limited-liability corporations – which were in turn used to funnel money from just 22 backers. Common Cause/NY is urging the City Council to pass legislation introduced by City Councilman Brad Lander which would require city campaign ads paid for by independent expenditures to list the top five contributors on the ad itself. “Independent expenditures unfairly color the campaign process by dominating the conversation with the point of view of a particular interest… First and foremost, voters need to know who is sponsoring the advertising they receive,” Lerner said.

Hedge Fund Donations to NYC Elections Pale in Comparison to State Contributions
Hedge funds have donated $500,000 to New York City races thus far. A significant portion, $170,336 has gone to City Council Speaker Christine Quinn’s mayoral campaign. The next closest recipient, Republican candidate Joseph Lhota, has received $47,625 from hedge funds. The $500,000 figure is small in comprasion New York State elections, where hedge funds – donating upwards of $7 million in the 2010 election cycle – are now the second-largest contributors after the real estate industry. The difference is largely due to New York City’s contribution limits, which are far lower than the state’s. James S. Chanos, founder of Kynikos Associates, who has not made any contributions in 2013 New York City races, explains that “limits are a big aspect to it, and I think people would give more if the limits were higher. At the federal and state level, we are constantly being called [about donations].” No one calls for contributions at the city level, he added.

Thompson’s Campaign Strategist Alleges Campaign Finance Misconduct by Rival de Blasio
New York City mayoral candidate Bill Thompson’s campaign strategist, Jonathan Prince, has filed a complaint with the city Campaign Finance Board seeking an investigation into fundraising events held for Democratic rival Bill de Blasio. De Blasio held fundraisers at the Villa Pacri restaurant in the Meatpacking district last year. The restaurant charged the de Blasio campaign $4,349.53 for drinks and appetizers for 75 people at the two events last year. The per-person per-hour rate amounts to $22.50, but a different group of the same size was charged $58.33 per-person per-hour just two days later. The complaint alleges that the difference between the “fair market value and the $22.50-per-person cost” is an in-kind campaign contribution. The campaign finance law iterates that candidates must pay fair market prices for campaign goods and services. De Blasio’s campaign dismisses the charge, saying that the price difference was due to differences in what the groups were served.

Sunlight Foundation Issues New Open Data Best Practices

Earlier this week, the Sunlight Foundation released version 2.0 of its Open Data Policy Guidelines. Sunlight’s guidelines are excellent and informative, and arrive just as New York State is issuing a new open data Handbook.


Sunlight splits its guidelines into 3 logical sections:

  1. What data should be made public.
  2. How to make data public.
  3. How to implement policy.

In all, Sunlight lists 32 provisions. This is a valuable document and we’re glad to see Sunlight is updating it annually. For Version 3.0 , we have a couple of recommendations:

First, try to reduce the key recommendations to 15 or so, and create a detailed addendum or “step by step” section that can include dozens or hundreds of very specific recommendations.

Second, we’d like to see  a stronger, more explicit made between Freedom of Information Laws and open data initiatives.  One of the key 15 provisions should be a one strike and you’re in policy, under which data sets released all or in part via a FOIL request should be under FOIL should be uploaded (in a machine-readable format) to the open data portal. Instead of a lengthy internal review to prognosticate which datasets users want to see on a data portal, recognize that when someone files a FOIL request, they are telling you what data they want to see. There’s no need to make opening data more complicated than that.

Good job Sunlight, we will certainly make sure that New York State ITS and the members of the NYC Transparency Working Group get copy of these guidelines, and encourage them to read it.

Another scandal, another social service empire, another powerful pol. (Rapfogel, Met Council, Silver.)

This month’s Albany/NYC scandal once again involves a very large, tax-funded, NYC based social service provider. In this case the organization is the Metropolitan Council on Jewish Poverty, which has $16.5 million in state contracts, and has a “synergistic” relationship with powerful Assembly Speaker Sheldon Silver. The Metropolitan Council’s long-time executive director and Silver confidante, William Rapfogel, is under criminal investigation by the Attorney General for embezzling hundreds of thousands of dollars from the Council via kick-backs from over-payments to its insurer, the Century Coverage Corporation. Importantly, Rapfogel’s wife, Judy, is Sheldon Silver’s long-time chief of staff.

But the larger concern is that Rapfogel was essentially transmuting state social service tax dollars paid to the Met Council into political contributions via Century Coverage. According to the NY Times:

“company employees have given almost $120,000 to various candidates since the late 1990s, including $26,175 to several candidates in 2013.”

The AG is investigating whether Mr. Rapfogel directed Century Coverage and its chief executive Joseph Ross to use some over-payments from the Met Council as political contributions to NYC and NYS office seekers. (Ross is a former board member of the Met Council and close to Rapfogel.) Oddly, press accounts have detailed Ross and Century Coverage’s campaign contributions to NYC mayoral candidates, but not to Sheldon Silver. For the record, the Attorney General’s transparency site, shows Ross and Century contributed at least $7,000 since 2006 to Silver or SpeakerPAC – which Silver directly controls. For whatever reason, on July 30, 2008, SpeakerPAC appears to have refunded a $4,500 contribution to Century.

Contributions from Joseph Ross and Century Coverage to Sheldon Silver
03/30/2011, $2500 from Century Coverage to Friends of Silver. (ck 22824)
07/30/08, Refund(?) $4,500 payment from SpeakerPAC to Century Coverage. (ck 5052)
06/07/06, $4,500 from Century Coverage to SpeakerPAC.  (ck 17154)
06/07/06, $4,500 from Joseph Ross to SpeakerPAC.  (ck 2757)



Money in Politics in New York, Aug. 12 Edition

Common Cause/NY and Fair Elections Ask Moreland Commission to Investigate Real Estate Contributions and 421-a Tax Break
A “Moreland Monday” analysis by Common Cause/NY is raising serious questions about millions of dollars in campaign contributions from real estate and development interests in New York City. Between 2011 and July, 2013 the Real Estate Board of New York (REBNY), a trade group of 37 real estate companies, contributed over $1.7 million to Senate Republicans, $478,000 to Senate Democrats, and $249,000 to Senate Independent Democrats. In the Assembly, the Democrats received $305,000 from the group, while Republicans accepted $67,000. REBNY also takes full advantage of New York’s LLC loophole– which allows each LLC controlled by a single corporation to be treated as an individual subject to a $150,000 aggregate contribution limit. Of REBNY’s political contributions, over 73 percent have gone to state candidates outside of New York City. The return on REBNY’s political investment in Albany is clear: the 421-a property tax abatement for new residential construction continues to balloon. The cost of foregone taxes from 421-a has increased from $130 million in 2002 to$1.1 billion in fiscal year 2013 – greater than the entire annual budgetfor New York City’s House Preservation and Development Agency. Susan Lerner, executive director of Common Cause/NY, urged “the Moreland Commission to use the full scope of their investigatory powers to fully examine this situation and recommend policies to end this exploitation.”

Moreland Commission Subpoenas Real Estate Developers for Documents
The Moreland Commission to Investigate Public Corruption has issued subpoenas to three high profile real estate developers in an apparent effort to examine whether there is any link between their campaign donations and huge tax breaks that were granted for several luxury apartments in New York City. A state law passed this session singled out five buildings in Manhattan for lower taxes. Moreland Commission Co-Chair Kathleen Rice has stated that the commission is committed to investigating loose campaign finance laws and their relationship with the epidemic of corruption scandals that rocked Albany earlier this year. “You can say ‘it’s just a couple of bad apples.’ Is it the political system itself that is the problem?,” Rice posed. The subpoenas have all been for documents thus far. No individual has been compelled to testify at this point. The New York State Board of Elections and the Joint Commission on Public Ethics have also both been asked to preserve all documents.

NYC Campaign Finance Board Disburses Public Funds for Primary Races
The New York City Campaign Finance Board (CFB) has approved the first round of public funds for 75 qualifying candidates running in citywide and city council races. As part of the matching funds program, NYC provides candidates that can raise enough small donations from constituents in their district with $6 for every $1 raised per donation up to $175. In the mayoral race, City Council Speaker Christine Quinn received $3.4 million in public funds, reflecting her large haul of small donations. Quinn was followed by Public Advocate Bill De Blasio who got $2.2 million. On the Republican side Joe Lhota, former MTA chairman, received $1.44 million. His spending limit was also increased from $6.42 million to $9.63 million reflecting heavy election spending by his primary competitor John Catsimatidis, who is self-financing his campaign. The board also denied public funds to City Comptroller John Liu’s mayoral campaign, citing “evidence of substantial non-compliance” with the law. A 139 page CFB report, to which Liu has released this response, details evidence of reporting discrepancies, insufficient documentation, and irregular means of attaining contributions by the campaign. Two former Liu campaign operatives have been convicted of scheming to route contributions through straw donors – people who contribute under their own name and get illegally reimbursed later. The CFB’s tough approach on compliance has helped prevent abuse of the City’s public funds.

Money in Politics in New York, August 2 Edition

Common Cause/NY Examines Fracking Contributions
A new analysis by Common Cause/NY illustrates that millions of dollars have flowed from fracking interests in New York to state and local campaigns. The investigation reveals that from January, 2007, to March, 2013, these interests – totaling 183 entities –contributed over $14 million to state and local campaigns. The money seems to follow the party in power. In the Senate, the ruling coalition of Republican and Independent Democratic Conference candidates received $2.22 million, while Senate Democratic candidates received $496,063. Assembly Democratic candidates got $784,942, compared to $439,617 for Assembly Republican candidates. The Fair Elections for New York coalition has called on Gov. Cuomo’s Commission to Investigate Public Corruption to subpoena information related to contributions in order to explore the transactions involved.

NYC Campaign Finance Board Releases New Database
The New York City Campaign Finance Board (CFB) has released new versions of its searchable campaign finance database as well as summaries of campaign expenditures and contributions. New rules adopted by the Campaign Finance Board require independent spenders to disclose expenditures above $100 and certain contributions above $1,000 to the CFB. The searchable database allows users to search through individual contributions, campaign expenditures and independent expenditures via filters such as recipient, contributor and transaction type. In addition, a summary page enables users to access an overview of campaign spending, independent expenditures, and public funds received for all citywide, borough president, and city council races.  Amy Loprest, executive director of the CFB, stated that“With the elections just around the corner, we hope these improved online disclosure tolls will help make more New Yorkers into better informed voters.”

Public Matching Funds in NYC Amplify Voices of Small Donors
New York City’s public financing program provides matching funds for candidates who can raise a certain number of small-dollar contributions from constituents in their district. Data from the latest disclosure filings show the effectiveness of the program during this election cycle. Thus far in 2013, candidates have collected more than $8.7 million from small donors – those contributing less than $250. This accounts for a 51 percent increase in small donations compared to the last election cycle in 2009. Donors giving less than $250 constituted 74 percent of all contributors in this year’s elections. Much of the credit for the extensive participation of small donors can be attributed to the 6-to-1 match New York City provides for the first $175 donated.