Government Ethics in NYS GRA Annual Conference 2007 Denver,

Government Ethics in NYS GRA Annual Conference 2007 Denver, Colorado Kent Gardner, PhD President & Chief Economist Center for Governmental Research Rochester & Albany, NY Overview Procurement Lobbying Law of 2005 Lawsuits secure more disclosure Public Employee Ethics Reform Act of 2007 Campaign Finance Reform The Sheriff of Wall Street meets Big Joe 2007 GRA Annual Conference Inform & Empower 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 2007 GRA Annual Conference Inform & Empower 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 Inform & Empower 2007 GRA Annual Conference 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 2007 GRA Annual Conference Inform & Empower 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 & wins Reveals millions to established firms—including several very prominent law firms—who claimed “new company” status then increased employment 100% (“shirt changers”) 2007 GRA Annual Conference Inform & Empower 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 authorities Purpose  To limit undue influence on procurement process  To improve ability of small & MWBE firms to compete for state contracts 2007 GRA Annual Conference Inform & Empower Procurement Lobbying Law of 2005  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 (cont.)  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 2007 GRA Annual Conference Inform & Empower Strongly supported by new governor, Eliot Spitzer Expanded definition of what is reportable as lobbying activity Public Employee Ethics Reform Act of 2007  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 Conference Inform & Empower Re-defines allowable gift Public Employee Ethics Reform Act of 2007 (cont.)  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 Conference Inform & Empower Commission on Public Integrity Public Employee Ethics Reform Act of 2007 (cont.)  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) 2007 GRA Annual Conference Inform & Empower 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 2007 GRA Annual Conference Inform & Empower Campaign Finance Reform (cont.) Statewide Office Now Individual Contributions Proposed Now Senate Proposed Now Assembly Proposed $55.9 $25.0 $15.5 $11.5 $7.6 $4.6 Soft money to be limited to $300k initially, falling to $150k by 2013 “Sham” LLCs, corporate subsidiaries, registered lobbyists barred More disclosure, enforcement, fines Bundling must be disclosed No limits on PACs, LLCs Effective date: January 2009 2007 GRA Annual Conference Inform & Empower 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 data What did he know? When did he know it? 2007 GRA Annual Conference Inform & Empower 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 Conference Inform & Empower Still troubling Campaign contributions for personal use Public Integrity Commission appointed by Gov Weak financial disclosure for elected officials (the Shelly Silver issue) Weak conflict of interest rules for legislators Door still revolves smartly for legislative aides Legislators can receive generous honoraria Board of Elections—still 2 and 2 etc 2007 GRA Annual Conference Inform & Empower