June 26, 2017: Good Government Advocates

June 26, 2017. FPI’s Executive Director, Ron Deutsch joins Barbara Bartoletti, Legislative Director for the League of Women Voters of New York State and Blair Horner, Executive Director of NYPIRG on WCNY News to discuss the failure of lawmakers to pass contract procurement and ethic reforms and voting laws.

“It’s been a sad day in Albany. It’s a bad day at the end of the legislative session when nothing gets done on contract reform, on economic development reform and we are looking at a major $800 million bid-rigging trial set to start in October and these guys did nothing to address that and I think that’s a shame.”

“I am really surprised and I thought this bill had broad bi-partisan support. It should have sailed through both houses and if the governor did not want to enter into a three way agreement, then the legislature should have laid it on his desk and allowed him to either veto it or approve it. So I think they had their opportunity here to do the right thing and sadly they weren’t able to get that done. This was nothing but simple checks and balances. THis is nothing to be pushing back against for the governor but he just dones’t want anybody looking over his shoulder.?

Here is the link to WCNY.

 

Is Ethics Reform Dead in Albany?

June 26, 2017. This article discusses the failure of lawmakers to implement ethical reforms that would prevent bid-rigging scandals in economic development contracts. The article discusses how Governor Cuomo is against the contract procurement bill and is proposing to hire a new inspector general who will work under him. Many are not happy with this decision and do not agree with the Governor’s proposal, including FPI’s Executive Director, Ron Deutsch.

Ron Deutsch, with the union backed think tank Fiscal Policy Institute, says it’s a missed opportunity.

“It’s another sad day in Albany,” said Deutsch. “We have the largest bid rigging scandal in state history, and we virtually ignored it.”

Deutsch says the bill currently in the legislature is what he calls a “common sense” measure. It would reinstate oversight of the procurement of economic development contracts to the State Comptroller. It has support from numerous government reform groups on the left and the right, as well as majority party sponsors in both houses of the legislature.

“If the Comptroller had that power, he would have caught some of the bid rigging issues that were being dealt with in these contracts,” Deutsch said. ”

Deutsch, with Fiscal Policy Institute, says an inspector under the authority of the governor would just not work.

“The governor’s proposal was preposterous,” said Deutsch. “It was a fox guarding the henhouse kind of approach.”

Here is the link to WXXI News.

Cuomo Raises Prospect of ‘Faso-Collins Federal Tax’

June 26, 2017. An article featured in the Times Union discusses the proposal of Governor Cuomo’s “Faso-Collins Federal Tax,” which is a $2.3 billion tax added on to local property taxes in New York State in order to offset the costs of Medicaid. The article notes that some do not support this proposal and criticize the governor for not cutting his own budget and deem is as a scheme and suggest that another source of revenue is needed.

Gov. Andrew Cuomo on Monday warned of the need for a new $2.3 billion tax to offset the cost of the state absorbing county Medicaid expenses if an add-on to federal health care legislation is signed into law.

The bill currently before the U.S. Senate preserves an amendment tacked onto the House version that would require New York state — and New York state alone — to absorb county Medicaid costs beginning in 2020. Cuomo wrote in a letter to members of Congress that state taxpayers will face a “‘Faso-Collins Federal Tax’ added onto local property taxes” if the provision makes it into law.

Ron Deutsch of the Fiscal Policy Institute, a fiscally progressive think tank, pointed to some state economic development spending as a place to consider trimming. So did the Citizens Budget Commission’s David Friedfel.

The state has “already been spending at a lower rate than we have in the past,” Deutsch said, noting Cuomo’s self-imposed 2 percent cap on spending increases. “So I think inevitably they’re going to have to look at some sort of revenue-raiser.”

Here is the link to the Times Union.

N.Y. Legislature Ends Session, But Plenty of Work Remains

June 24, 2017. An article in the Saratogian, that quotes FPI’s executive director Ron Deutsch, discussed the failure of the Senate and Assembly to pass a routine school governance extender and reforms to prevent future bid-rigging scandals. They may convene again in the summer to make a decision on education and extending local sales tax.

The Senate and Assembly adjourned for the summer Wednesday without acting on ethics reform, despite a 2016 legislative session that saw former Senate Majority Leader Dean Skelos get five years and former Assembly Speaker Sheldon Silver 12 years in federal prison on corruption charges.

They also did not act on tightening oversight of the state’s multi-billion economic development grants program, despite the bid-rigging scandal that will see former Cuomo aides and campaign donors go on trial this fall.

The groups were especially critical of the lack of action on government ethics and contract procurement.

“Scandals and ensuing inaction seem to be the ‘new normal’ in Albany … Yet another sad day in Albany politics,” said Ron Deutsch of the Fiscal Policy Institute.

Here is the link to the Saratogian.

Response from Governor Cuomo, Senate Leader Flanagan and Speaker Heastie to Largest Bid-Rigging Scandal in State History: NOTHING

Response from Governor Cuomo, Senate Leader Flanagan and Speaker Heastie to Largest Bid-Rigging Scandal in State History:

NOTHING

Elected leaders fail to pass common sense reforms to curb sky-high corruption risks revealed in $800m state contracting scandal  

(June 22, 2017, Albany) A coalition of prominent government watchdog groups say Governor Cuomo, Senate Leader Flanagan and Speaker Heastie have completely failed to address the huge problems revealed by last year’s alleged rigging of $800m in state economic development contracts and that billions of state funds remain at risk for bid rigging and pay to play.

The groups say the proposed reforms were sensible, straightforward and supported by dozens of rank and file legislators, and endorsed by numerous editorial boards.

Proposed reforms would have restored the Comptroller’s independent oversight powers to review contracts before they are finalized, corralled unaccountable, state controlled not-for-profits, and created a “Database of Deals” for billions in state subsidies to businesses.

“This is a massive failure by New York State government — starting with the governor, who actively worked to derail Clean Contracting reforms. What message does it send when the governor, senate and assembly fail to pass reforms after the biggest bid rigging scandal in state history?  Why should the public believe that Albany is spending public money — our money — cleanly and fairly?”
Said John Kaehny, Executive Director, Reinvent Albany, 917-388-9040

“State government just squandered its opportunity to restore public confidence to the procurement process and shed light on billions of dollars in economic development spending. There is no excuse for inaction after an $800 million bid rigging scandal – the people of New York deserve better.”
Said David Friedfel, Director of State Studies, Citizens Budget Commission, 518-429-2959

“Scandals and ensuing inaction seem to be the ‘new normal’ in Albany.  One has to wonder how many indictments are needed before we enact any meaningful reforms. The governor and the legislative leaders had the opportunity to restore the public’s trust and put real accountability measures in place and instead they did nothing.  Yet another sad day in Albany politics.”   
Said Ron Deutsch, Executive Director, Fiscal Policy Institute, 518-469-6769

The governor and state lawmakers are elected to solve problems, not ignore them.  Sadly, the failure to do anything to respond to New York’s scandals is a devastating condemnation of Albany’s ability to do its job.  The governor must take the lead in advancing contracting reforms that focus on independent oversight, greater openness, and strict limits on the state’s ‘pay to play’ campaign financing system.”
Said Blair Horner, Executive Director, NYPIRG, 518-727-4506

“Our latest bid rigging scandal resulted in eight federal entitlements and $800 million in misused state funds. Nearly 7 months later, and the legislature still hasn’t done a single thing to prevent future government waste. In November, we made a simple request: clean up New York’s contracting procurement process through stronger oversight, increased transparency, and greater accountability. We asked for non-controversial reforms that were aimed at eliminating preferentialism in the procurement process and ensuring that state funds spent on contracts should be publically disclosed. The legislature chose not to pass our reforms. As a result, our procurement process will continue to be susceptible to the influence of outside interests.”
Said Jennifer Wilson, Program and Policy Director, League of Women Voters of NYS, 518-465-4162

“The Legislature’s inability to pass the Clean Contracting common-sense package of procurement reform is a failure of epic proportions.  New Yorkers elect their representatives to address the state’s problems, not to sit by, either afraid to act or convincing others not to act, while contractors and officials are indicted and taxpayer dollars are squandered through continuing crony capitalism.”
Said Susan Lerner, Executive Director, Common Cause New York, 212-691-6421

“The willingness toward inaction in Albany is astounding. Simple reforms to prevent rigging and corruption in the awarding of government contracts are uncontroversial solutions to a well-documented problem. The fact that our legislative leaders have chosen to shirk their responsibility to respond to what has become rampant impropriety, despite the support of many of their rank-and-file members, signals that they are no longer willing to act in the public’s best interest. And New Yorkers will be the ones to pay the price.”
Said Dick Dadey, Executive Director, Citizens Union, 917-709-2896

Good government and fiscal watchdog groups had advocated for 5 major clean contracting reforms during the legislative session, with 78 different lawmakers across party and ideological lines signing on to legislation supporting at least one of the reforms.  The reforms would have strengthened the integrity of the state’s economic development programs by:

  1. Requiring competitive and transparent contracting for the award of state funds by all state agencies, authorities, and affiliates. Use existing agency procurement guidelines as a uniform minimum standard;
  2. Transferring responsibility for awarding all economic development awards to Empire State Development Corporation (ESDC) and end awards by state non-profits and SUNY;
  3. Empowering the Comptroller to review and approve all state contracts over $250k;
  4. Prohibiting state authorities, state corporations, and state non-profits from doing business with their board members; and
  5. Creating a ‘Database of Deals’ that allows the public to see the total value of all forms of subsidies awarded to a business – as six states have done.

The groups further urged state leaders to reduce the potential for conflicts of interest by exploring options to limit campaign contributions from anyone seeking a state contract.

Legislation encompassing these principles was largely expressed in S.3984 (DeFrancisco) / A.6355 (Peoples-Stokes), the Comptroller’s Clean Contracting Bill which, while reported by the Senate Finance Committee in April and amended in May, was never voted on by the Senate despite 30 of 63 members of the Senate signing on to the bill.  The Assembly never moved the bill out of committee and despite numerous comments about reviewing, discussing, considering, and conferencing the legislation, ultimately didn’t change the bill from the Senate amended version and only amended the bill in the final week of the legislative session.

A Database of Deals was supported by both the Senate and Assembly in their budget resolutions, and the Governor agreed in the budget to create a report by January 2018 detailing the spending for each economic development program. A Database of Deals providing data on the benefits received by each company was the subject of discussions between the legislature and advocates periodically during the session, and a bill reflecting those discussions was introduced in the last week and a half of the session ((A8175) Schimminger/S6613-A (Croci)). Also considered was an Executive Budget proposal the Governor put forth prohibiting campaign finance contributions by vendors to the Executive when bidding on and negotiating contracts.

Lack of Reforms at NY Capitol Called ‘Pathetic’

June 22, 2017. An article, featured in Lohud ,discussed Governor Cuomo’s decision not to enact reforms for better transparency when allocating money for economic development programs. Groups called for changes such as a “Database of Deals” and the restoration of power to the state comptroller to review state contracts. The reforms were requested in response bid-rigging scandals.

Legislative leaders and Cuomo failed to find a compromise on how to better review state contracts and job-creation programs amid the arrests last fall of Cuomo’s former top aide Joseph Percoco on kickback charges and SUNY Polytechnic Institute president Alain Kaloyeros on bid-rigging charges.

“Scandals and ensuing inaction seem to be the ‘new normal’ in Albany,” said Ron Deutsch, executive director of the Fiscal Policy Institute, a labor-backed think tank in Albany. “One has to wonder how many indictments are needed before we enact any meaningful reforms.”

Here is the link to Lohud.

OUR VIEW: Celebrate World Refugee Day Saturday at City Hall

June 16, 2017. An editorial featured in the Observer-Dispatch cited FPI’s and the Center for American Progress’s co-released report, “Refugee Integration in the United States.” The op-ed is not only an invitation to celebrate World Refugee Day with those in Utica, but it also discusses how Utica is a city that refugees have helped rebuild by contributing to the local economy and tax rolls and reversing population decline.

There is little question that refugees are making significant contributions to our communities across the nation – Utica included. A report last year by the Center for American Progress and the Fiscal Policy Institute examined workforce and integration trends for Somali, Burmese, Hmong and Bosnian refugees and found that:

– Burmese and Bosnian refugees who have been here for more than 10 years are more likely to own their own home than the average U.S.-born citizen.

– Refugees start and own businesses at a rate close to the average for U.S.-born people, in some cases. Thirty-one out of every 1,000 working Bosnian refugees are business owners, for example – equal to the average of U.S.-born people.

– After 10 years in the U.S., 86 percent of Somalis speak English “well” and 61 percent speak it “very well.”

The report mentioned Utica quite frequently, noting that both Bosnian and Burmese refugees are playing a significant part in the revitalization of the city. Bosnians make up 16 percent of all immigrants in metropolitan Utica, and Burmese make up 13 percent. It was further noted that refugees brought new entrepreneurial activity to Utica, filled about half of the labor force needs of a local medical equipment manufacturer, and “revitalized declining neighborhoods, buying and renovating vacant housing.”

Here is the link to the Observer-Dispatch.

Clean Contracting Bill Gaining Support

June 14, 2017. Ron Deutsch, executive director of the Fiscal Policy Institute, joined Alex Camarda, Senior Policy Consultant at Reinvent Albany, and Jennifer Wilson from the League of Women Voters, on Capital Tonight to discuss the “clean contracting” bill, which would require transparency of economic development projects. Ron argues that now is a good opportunity for the legislature to earn the community’s trust and address the issue before the trial for the bid-rigging scandal as the legislative session ends.

Here is the link to the episode on Capital Tonight.

Reform Groups Beg: Bolster NY’s Contracting Laws

June 14, 2017. FPI and other organizations gathered in the Capitol to ask lawmakers to pass reforms that would expand New York State’s contracting guidelines in order to oversee economic development projects and to prevent other bribery and bid-rigging scandals. Reforms that these organizations are pushing for include a “database of deals”, which track public money given to private corporations.

Government-reform organizations including Reinvent Albany, the New York Public Interest Research Group and the League of Women Voters gathered in the state Capitol on Wednesday to beg lawmakers — almost literally — to pass several reforms, including measures that would expand the state’s contracting guidelines to opaque, semi-public entities and create a “database of deals” to track government dollars heading to private businesses.

“We’ve been pushing and pushing and pushing on this,” said Ron Deutsch, executive director of the Fiscal Policy Institute, a labor-backed think tank. “If it works for me to get down on my knees and beg, I will do that. I’m hoping that’s not the case.”

Here is the link to Lohud.

Legislature Must Act Now: Clean Contracting Reforms

For immediate release: June 14, 2017

Legislature Must Act Now Groups say Flanagan, Heastie and Cuomo must pass meaningful Clean Contracting reforms in response to $800m state bid-rigging scandal

Albany, New York – Prominent budget and transparency watchdog groups today called on the legislative leaders to act on their public statements on clean contracting, and pass meaningful legislation in response to the largest bid-rigging scandal in state history.

Senate President John Flanagan and Assembly Speaker Carl Heastie are both on the record as supporting action this session on clean contracting:

  • Senate President Flanagan has called the issue “extraordinarily important” and said, “I expect we will have procurement reform before the end of the session”…“Whether it’s Sen. DeFrancisco or a variation of that bill, I expect we will move in that direction.”  
  • Assembly Speaker Carl Heastie has said, ““…I’m going to sit down with the committee chair and we’re going to figure out what we’re going to do….I’ve always said the best way to go is to have a three-way agreement.  That would be great.”

Both leaders have made supportive statements regarding the comptroller review of contracts before they are executed:

  • Senate President Flanagan: “I truly believe the comptroller plays an absolutely critical role in public policy in New York.”

Assembly Speaker Heastie: “The people of the state of New York will still feel better knowing that there’s some other entity looking at it, like the state comptroller…..Another set of eyes will make people feel better that, yes,things are done correctly.”

The groups called on Senate Leader Flanagan and Assembly Speaker Heastie to move to deeds from words, and address clean contracting before the legislative session ends.  The groups note that the Comptroller has put forth a program bill, and the Governor has made a proposal in the budget.  It’s time for the legislature to indicate where they stand, and forge a solution.

The groups believe the best, most comprehensive solution is the comptroller’s program bill S.3984-A (DeFrancisco)/A.6355 (Peoples-Stokes) which restores independent approval of  state contracts by the State Comptroller, and ends contracting for non-academic purposes by state-controlled non-profit organizations. Earlier this year, the groups recommended five Clean Contracting reforms and suggested the state take measures to reduce conflict of interest and pay to play.

Legislation Incorporating Groups’ Five Clean Contracting Reforms

Proposal Bill with Proposal
Require competitive and transparent contracting for the award of state funds by all state agencies, authorities, and affiliates. Use existing agency procurement guidelines as a uniform minimum standard. A6355/S3984-A (Part B)
Transfer responsibility for awarding all economic development awards to the Empire State Development Corporation (ESDC), and end awards by state non-profits and SUNY. Partially achieved through A6355/S3984-A (Part C)
Empower the comptroller to review and approve all state contracts over $250k. Mostly achieved through A6355/S3984-A (Part A, B, and D)
Prohibit state authorities, state corporations, and state non-profits from doing business with their board members. There is not legislation with this solution, although some attempt to address the issue through recusal or disclosure of conflicts of interest have been put forth.
Create a ‘Database of Deals’ that allows the public to see the total value of all forms of subsidies awarded to a business – as six states have done. A8175/S6613
Reduce the potential for conflicts of interest by exploring options to limit campaign contributions from anyone who has or is seeking a state contract. Part L of the Executive Budget Good Government and Ethics Legislation is a foundation for this.

 

Groups Call for Action

“The moment of truth has arrived and the legislative leaders and governor must act. State and federal prosecutors say $800m in state economic development contracts were rigged.  This demands action to restore confidence in government contracting to assure taxpayers their money is being wisely and fairly spent.”
Said John Kaehny, Executive Director, Reinvent Albany, 917-388-9040

“With only a handful of days left in this legislative session, it is time for the Assembly and Senate to come together and adopt meaningful procurement reform and enhance economic development spending disclosure. The State’s citizens deserve to have confidence in how their tax dollars are spent.”
Said David Friedfel, Director of State Studies, Citizens Budget Commission, 518-429-2959

“Time is running out and we need to enact meaningful reforms before it’s too late.  We need to restore the public’s trust and put some serious checks and balances in place to ensure that we never have another massive bid-rigging scandal in this state again.”
Said Ron Deutsch, Executive Director, Fiscal Policy Institute, 518-469-6769

“New Yorkers can draw a direct line from the state’s opaque system of government contracting and limited oversight to the recent allegations of corruptions raised by the US Attorney. The governor and the legislature simply cannot pay lip service to these allegations. New Yorkers deserve the enactment of tough, new corruption-busting measures coupled with the strengthening of the independent oversight of the state Comptroller.”
Said Blair Horner, Executive Director, NYPIRG, 518-727-4506

“Our groups have been pressing the legislature to act on New York’s procurement process since November of last year. Now there is less than a week left of session and still the legislature has not addressed these issues. Common sense reforms to ensure a competitive bidding process, allow the Comptroller to review contracts, and create a database of deals will ensure that the public’s tax dollars are being spent appropriately. If the legislature does not pass these reforms, our contract awarding process will continue to be susceptible to the corruption.”
Said Jennifer Wilson, Program and Policy Director, League of Women Voters of NYS, 518-465-4162

“Clearly, our state’s procurement policies are primed for corruption and abuse. New Yorkers demand and deserve clean contracting policies that support a transparent and competitive bidding process, not crony capitalism.”
Said Susan Lerner, Executive Director, Common Cause New York, 212-691-6421

“Corruption in New York State related to the appalling lack of oversight in the awarding of state contracts is not a speculative outcome; we have witnessed the misuse of public monies leading to scandal after scandal involving the state’s most influential lawmakers. The reforms embodied in the Comptroller’s program bill, if passed, would significantly impact the potential for such corruption. These are common sense solutions that New Yorkers have long deserved.”

Said Dick Dadey, Executive Director, Citizens Union, 917-709-2896