Government Ethics in NYS
GRA Annual Conference 2007
Denver, ColoradoKent Gardner, PhDPresident & Chief Economist
Center for Governmental ResearchRochester & Albany, NY
2007 GRA Annual ConferenceInform &
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OverviewProcurement Lobbying Law of 2005Lawsuits secure more disclosurePublic Employee Ethics Reform Act
of 2007Campaign Finance ReformThe Sheriff of Wall Street meets
Big Joe
2007 GRA Annual ConferenceInform &
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Alan Hevesi, fmr Comptroller
Chauffeurgate Used state funds to support a full time driver & other
personal assistance for his wife—after having been caught previously
Republicans hadn’t fielded a strong candidate; Hevesi wins anyway; resigns in plea bargain with Albany County DA
Ongoing Daniel Hevesi under investigation for job at Third
Point Capital NYS pension fund invests; Andrew Hevesi gets campaign contribution from CA fund after investment
Jack Chartier, Hevesi aide, under investigation for providing state car & other favors to Peggy Lipton
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Progress on Pork $200m per year in “member items” $3.5b in borrowed funds allocated; add’l $800m
appropriated Related: $400m in annual debt service on
economic development borrowing Worthy recipients:
National Museum of Catholic History and Art in Harlem ($4m)
Irish Reparatory Theater in Chelsea ($200k) St. Edward the Confessor RC in Albany ($100k) Christian Airmen in Buffalo
Lump sum in budget, secret MOU among leaders documents allocation
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Progress on Pork (cont.)
Consortium of media organizations (led by Albany Times-Union) secured ruling that member items must be disclosed and lined-out in budget
Close associations revealed between legislators & recipients (I’m shocked!)
Capital pork, despite claims by Spitzer, still not subject to same level of scrutiny
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Progress on Empire Zones
VERY generous benefits for economic development projects meeting specific criteria
Key provision: % tax credit driven by % increase in employment
Reporting? What reporting??Syracuse Post-Standard sues NYS & winsReveals millions to established firms—
including several very prominent law firms—who claimed “new company” status then increased employment 100% (“shirt changers”)
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Procurement Lobbying Law of 2005
Lobbying law previously applied only to lobbying of NYS legislature—not state agencies
Established reporting requirements both for covered entities and private firms seeking contracts Affected entities include both state agencies and
state/local authoritiesPurpose
To limit undue influence on procurement process To improve ability of small & MWBE firms to
compete for state contracts
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Procurement Lobbying Law of 2005 (cont.)
Advisory Council on Procurement Lobbying established to assess effectiveness of law
CGR engaged to conduct a survey of affected public entities and businesses Firms receiving contracts with state agencies since
enactment Certified MWBE firms Firms receiving NYS Contract Reporter
Findings 1/3 public entities thought it did not apply to them 50% of business firms hadn’t heard of the law Businesses doing regular business with the state reported
that cost of compliance was not insubstantial Conclusion: Did reduce ability of large firms to
improperly influence disposition of state contracts; Cost & complexity of compliance probably reduced competition
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Public Employee Ethics Reform Act of 2007
Strongly supported by new governor, Eliot Spitzer
Expanded definition of what is reportable as lobbying activity Establishes $15,000 threshold: Any determinations
by public official or entity working in cooperation with public official for disbursement of more than $15,000 of public money (loan or grant) must be reported as lobbying
Definition now includes pork (“member items”) and disbursements under “economic assistance” rubric
2007 GRA Annual ConferenceInform &
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Public Employee Ethics Reform Act of 2007
(cont.)Re-defines allowable gift Formerly “anything of value” with $75 threshold Now defined specifically as "anything of more than nominal value given to
a Public Official in any form including, but not limited to money, service, loan, travel, lodging, meals, refreshment, entertainment, discount, forbearance or promise, having a monetary value“
No threshold—no gift "unless under the circumstances it is not reasonable to infer that the gift was intended to influence“ recipient
2007 GRA Annual ConferenceInform &
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Public Employee Ethics Reform Act of 2007
(cont.)Commission on Public Integrity Replaces Temporary State Commission on
Lobbying and State Ethics Commission Not yet implemented
Penalties increased Class A misdemeanor for first offense Can be barred from lobbying for one year for
repeated violation Four year debarment available under
provisions of procurement lobbying law Adds monetary penalty up to 3x amount not
reported (adds to existing fines of $25k/$50k)
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Campaign Finance Reform
Spitzer holds congestion pricing grant, property tax “rebates,” $1B in pork, pay raise for legislators, etc hostage to reform agenda
Majority Leader Bruno weakened after July 1 revelations that he used state helicopter to attend political events
Agreement reached July 19 after 96 hour negotiation
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Campaign Finance Reform (cont.)
Soft money to be limited to $300k initially, falling to $150k by 2013
“Sham” LLCs, corporate subsidiaries, registered lobbyists barred
More disclosure, enforcement, finesBundling must be disclosedNo limits on PACs, LLCsEffective date: January 2009
Now Proposed Now Proposed Now ProposedIndividual Contributions $55.9 $25.0 $15.5 $11.5 $7.6 $4.6
Statewide Office Senate Assembly
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Oops . . .Troopergate July 23: Atty General
Andrew Cuomo releases report on use of state aircraft by Majority Leader Bruno
Implicates top Spitzer aides Misuse of state police to monitor Bruno Gather data from state police through sham
FOIL Phone call to reporter suggesting he request
dataWhat did he know? When did he know it?
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Troopergate continues
Aides (top flack, chief of staff, Homeland Security advisor) refused to speak to Cuomo under oath
Albany County DA begins criminal probe
Ex-flack hires prominent criminal defense attorney
What deal on campaign finance reform?????
2007 GRA Annual ConferenceInform &
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Still troublingCampaign contributions for personal usePublic Integrity Commission appointed by GovWeak financial disclosure for elected officials
(the Shelly Silver issue)Weak conflict of interest rules for legislatorsDoor still revolves smartly for legislative aidesLegislators can receive generous honorariaBoard of Elections—still 2 and 2etc