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Paterson & Bloomberg Team Up to Veto Reform Impacting Sweetheart Deals Like Atlantic Yards
Paterson and Bloomberg are uniting to veto major reform of the cess pool of
unaccountability and non-transparency otherwise known as the New York State
Public Authorities. And why? Because it might block or upset thier friends'
developments such as Atlantic Yards and diminish their control over the authorities
which laughably claim to be independent.
We're looking at you Empire State
Development Corporation, and you Metropolitan
(Update: Much more [and with less sarcasm] from Norman
Oder on his Atlantic Yards Report, where he writes that
regardless of the future of this reform legislation [nearly universally praised
by editorial boards and good government groups], the MTA Board members already
have a "fiduciary duty to protect the authority’s bottom line.")
The Times reports:
Audits? Why would we want to audit unelected bodies that approve billions in contracts
and expenditures? Isn't the honor system good enough?
Set to Reject Public Authority Overhaul
By Danny Hakim
ALBANY — Gov. David A. Paterson is set to reject a sweeping overhaul of the
state’s hundreds of public authorities that was passed by lawmakers last month
but is opposed by the governor’s staff and Mayor Michael R. Bloomberg of New
The Paterson administration will ask the Assembly to delay sending the bill
to the governor’s desk, officials said, and will try to devise a new version
of the legislation before a special legislative session next month. But the
governor and mayor have so many objections to the current bill that it could
be difficult to negotiate a new one with the Legislature in just a few weeks.
If the governor were to veto the bill, or leave it in limbo, he would be turning
aside the most ambitious attempt in decades to overhaul the system, which
includes groups ranging from the Metropolitan Transportation Authority to
the Niagara Falls Bridge Commission, and which has been criticized as functioning
as a shadow government with little oversight.
The Bloomberg administration has argued that the bill would unfairly infringe
on the mayor’s power and that it contains a provision that would place prominent
development projects in New York City at risk. Mr. Bloomberg has no official
say in the matter, but he and the governor are on generally good terms, and
their staff members have been discussing concerns about the legislation.
The governor’s office objects to a number of provisions, including one that
would require the comptroller to review authority contracts of over $1 million
— a restriction that Mr. Paterson and business groups say will be too time-consuming.
They also oppose a provision that would require authorities to record and
disclose all contacts with lobbyists because it appears to encompass contacts
with officials in other government agencies or authorities.
Supporters of the bill argue that the dispute is about power, and that the
governor’s office and the mayor fear that the bill would diminish their sway
over the authorities, which are ostensibly independent.
The legislation’s main provision would create an independent budget office
with an array of powers over state authorities, including the ability to issue
subpoenas in investigations and to conduct regular audits.
The article continues with this important aspect of the bill, which apparently
will not come to be:
The legislation also makes clear that people who serve on authority boards
have a fiduciary responsibility to the authorities and their missions rather
than to the mayor, the governor or the elected officials who appointed them.
Mr. Bloomberg is especially opposed to that provision.
DING! DING! DING!
The mayor also believes restrictions that would prevent authorities from selling
off their land for below fair market value could hamper a number of developments,
including a $700 million East Harlem project, which includes 600 housing units
for low- and moderate-income families, and the East River Science Park, a
$700 million complex in Manhattan that the city hopes will make it a leader
Yup, the Times forgot to mention the hampering this would do to the MTA's
sweetheart deal with New York Times business partner Forest City Ratner, which
allows Forest City Ratner to pay $20 million at closing and the equivalent of
$80 million over 22 years at an incredibly low 6.5% interest rate for a 9-acre
rail yard, appraised at $214.5 million in the heart of Brooklyn—a site Ratner
CEO Chuck Ratner once called a "great piece of real estate."
“We strongly support increasing transparency among public authorities, but
this bill is a step backward,” said Michelle Goldstein, the director of the
mayor’s Office of State Legislative Affairs. “The proposed legislation would
make authorities less accountable to the public and sharply curtail the city’s
ability to build affordable housing, create jobs and develop additional community
Yeah, right. Spare us your concern about taxpayer expenditures. We won't hold
our breath on Paterson's version of a new bill.
Peter E. Kauffmann, a spokesman for the governor, said Mr. Paterson wants
an overhaul “implemented in a way that will bring real transparency and accountability
to authorities without passing along added costs to taxpayers or stifling
job growth through unnecessary delays to critical economic development projects.”
The article continues:
The measure, adopted by the Senate in the wee hours near the end of its chaotic
session last month, is one of the few actions to emerge from Albany this year
that have been praised by editorial boards and civic groups. Many of the bill’s
principles were drawn from a Pataki-era commission on authority reform led
by Ira Millstein, a lawyer who is a leading expert on corporate governance.It's about both: power and particular projects. Atlantic Yards being the largest elephant in the room.
The legislation has been promoted for years by Assemblyman Richard L. Brodsky,
a Westchester Democrat who has investigated abuses at the transit authority
and the Canal Corporation and, more recently, has scrutinized the financing
of Yankee Stadium.
Mr. Brodsky said that Mr. Bloomberg’s concerns about property sales were a
smoke screen because the city could easily award grants to developers instead
of selling them land for below the market value.
“Their arguments are bogus,” he said. “It’s about power; it’s not about any
Mr. Millstein said that “if the fiduciary issue is what’s preventing support,
I think that would be a shame.”
Expect more hearings on this issue from Senator Perkins.
“The directors of public authorities surely should take into account the views
of whomever it is that appointed them,” he added. “But thereafter, they must
understand that they are fiduciaries for all the constituencies, and particularly
the people of the state of New York.”
Senator Bill Perkins, a Harlem Democrat who was the chief sponsor of the bill
in the Senate, said that taxpayers have too often been shortchanged in development
“The whole purpose of this is to make sure that the public gets the best deal,”
also publishes Assemblyman Brodsky's scorching statement on the coming veto:
"Real reform is never easy. Governor Paterson can protect the status quo,
the mushrooming debt, the questionable and sometimes corrupt actions we repeatedly
uncovered, or he can stand up for real change. The Legislature crafted the bill
with almost no activity or interest by the Paterson Administration. The opportunity
to raise questions was available and no interest was shown. And the arguments
made by the Mayor and some in the Administration are simply bogus and untrue.
We've seen the national health care debate poisoned by false allegations. We won't
let the decision about true authority reform to fall victim to that tactic.")
Let's see what Brodsky will do about it.