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Will Albany’s legacy of corruption continue?

OUTRAGES & INSIGHTS



Heaney photo by kc kratt

 

Jim Heaney is editor of Investigative Post, a nonprofit investigative reporting center based in Buffalo.

 


 

First came reports on the dirty dealings involving the Buffalo Billion. Albany did nothing.

 

Then came the indictments to two of Governor Andrew Cuomo’s top aides and several of his major campaign contributors. And again, Albany did nothing.

 

Next up was the trial, convictions, and prison sentences of said aides and contributors. Once again, Albany—well, you know.

 

New York state government, regarded as one of the most corrupt in the nation, has been steadfast in resisting reforms over the past several years. Cuomo would have none of it and legislators, particularly his fellow Democrats, were unwilling to buck the governor—not just over corruption, but also the billions of dollars a year the state doles out in corporate subsidies.

 

Things may be no different in Albany come the legislative session that began earlier this month. Or maybe, just maybe, matters have reached a boiling point. The Cuomo administration’s hodgepodge of economic development programs—some $4 billion a year, much of it earmarked for upstate—has a lousy return on investment.

 

 

Investigative Post reported in 2017 that if upstate New York was a standalone state, its job growth during Cuomo’s first six years in office would rank fourth worst in the county, lagging behind, among other places, Mississippi. But it’s not what’s happened—and not happened —upstate that has lit the fuse. It’s the $3 billion in subsidies granted Amazon to locate a major satellite office in Queens, which hasn’t been a popular move, given the city’s major capital needs (think MTA and public housing) and the sneaky manner in which Cuomo and Mayor Bill de Blasio put the deal together.

 

John Kaehny, executive director of Reinvent Albany, calls the Amazon deal and the Buffalo Billion scandal “bookends to the same story. The Amazon deal has people thinking in a different way. Downstate Democrats are now much more interested in economic development.” As a result, a package of reform bills considered longshots this legislative session may have a fighting chance. “These reforms are poker chips in a big game of negotiations between the legislature and governor,” Kaehny adds.

 

Not that reform is a slam dunk, or even likely, in the face of Cuomo’s continued opposition. He will almost certainly fight to save programs like Start-Up NY and the Regional Economic Development Councils that have been set up around the state. And he recently renewed his attacks on the most muscular of the anticorruption bills, one that would restore the state comptroller’s oversight in the awarding of state contracts. Assembly Speaker Carl Heastie, aided and abetted by Crystal Peoples-Stokes, the Buffalo Democrat recently installed as majority leader, have kept the bill bottled up in committee. Peoples-Stokes won’t even acknowledge New York has a corruption problem.

 

Heastie, who’s currently peeved with Cuomo regarding legislative pay raises, might be less keen on protecting the governor’s flanks this legislative session. And Senate Majority Leader Andrea Stewart-Cousins has put reform-minded lawmakers in charge of several key committees that appear poised to provide real oversight into corruption and economic development programs. Kaehny notes, “I expect a lot more scrutiny by the Senate.”

 

Despite the lack of legislative action, the scandal has spurred some change. “I would surmise that what happened with Mr. Ciminelli is a cautionary note—with an exclamation point—to contractors and developers doing business with the current state administration,” says Robin Schimminger, the Kenmore Democrat who chairs the Assembly’s Economic Development Committee. Indeed, Lou Ciminelli, convicted on felony corruption charges, is ruined. He received a light prison sentence, but his company, the biggest development firm in Western New York, went out of business after his indictment.

 

The Cuomo administration has also started to back away from the two state-affiliated nonprofits that SUNY Polytechnic Institute founder Alain Kaloyeros used to orchestrate his dirty deals. Much of its portfolio has been shifted to Empire State Development Corporation, the state authority headed by Buffalo businessman Howard Zemsky. “The days of Kaloyeros doing whatever he wanted are over,” Kaehny says. “Things have changed, the question is ‘how much?’”

 

To people like Schimminger and Kaehny, the answer is “not enough.” There are the stalled legislative measures, for starters. Kaehny also notes the cozy relationships involving private firms and the state university system and school affiliated foundations. These so-called public-private partnerships often lack transparency. “There are still pockets of darkness,” he observes.

 

Of course, a big part of the problem isn’t what’s illegal, but rather what’s perfectly permissible under state law. I’m talking about the loophole in state election law that developers and other real estate interests have exploited to allow campaign contributions through limited liability corporations to donate in amounts well beyond the limits set for individuals and companies. It amounts to legalized bribery and if Albany wants to clean up its house, it can start there.

 

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