Just how messed up Nassau County governance is was on view at a SRO hearing, held in a small meeting room on the Democrats’ side of the Theodore Roosevelt Building, on ways to address the cronyism and corrupt procurement practices.
Nassau County finances have been in the toilet under Republican rule going back to the Gulotta days, who, at the peak of the US economy, mind you, pushed Nassau County to the brink of bankruptcy. That’s when NIFA came into the picture.
The County made great strides under Tom Suozzi, a Democrat who managed to accomplish a great deal in terms of revitalizing downtowns with sustainable development.
And then Ed Mangano came into office and his first act was to repeal the tax on fossil fuels – put into place not only to rescue the county from financial ruin, but to encourage energy conservation essential to climate mitigation. (Superstorm Sandy, which followed, is an example of what Long Island can look forward to if the Climate Denying Fossil Fuel Lovers take hold of government.)
Governor Cuomo has been very good about putting money and resources behind measures to inject sustainable economic development, but the grants and funding have overwhelmingly gone upstate (Buffalo, Rochester), the southern tier (Binghamton), and to Suffolk. Nassau County has seen little, done little to encourage positive economic development. We see virtually none of the StartUp NY enterprises such as SUNY Stony Brook has captured.
What is County Executive Ed Mangano’s big idea to resuscitate Nassau County’s economy? Casino gaming, the sorriest, saddest, most destructive excuse for “economic development.” While there has been no specific plan offered, apparently, Mangano’s 2016 budget includes $20 million in gambling revenue.
This is the sign of a desperate politician, a lazy leader, someone who lacks the intelligence and the vision to promote new productive enterprises worthy of the talented young people our schools graduate each year, and each year, when they graduate college, migrate to other places for creative jobs.
Suffolk County, in contrast, has a leader, Steve Bellone, who knows how to bring new enterprises.
A review of announcements of millions of dollars of economic development grants and incentives given by New York State show the vast preponderance going upstate. But of the funds funneled to Long Island, the lion’s share has gone to Suffolk County – to Stony Brook and Farmingdale – with a smattering of even biomedical and engineering-oriented grants going to North Shore-LIJ, Winthrop, Hofstra and Long Island University.
But while Nassau County has gotten very little investment money to fund high-tech businesses, the county’s Industrial Development Agency (IDA) has been extraordinarily generous handing out tax exemptions to favored firms without getting the jobs they are designed to create (another side of cronyism).
As Bill San Antonio reported in June in The Island Now, “Tax breaks on projects approved by the Nassau County Industrial Development Agency were more than 10 times higher per job created than the state’s median level in 2013, a year that saw statewide increases on exemptions awarded to businesses but fewer jobs created, according to a recently issued report from state Comptroller Thomas DiNapoli’s office.
“Having netted just 1,835 jobs in 2013, the most recent year for which statistics are available, Nassau lagged behind nearby Suffolk (14,080) and Westchester (7,982) counties despite approving more projects (278) and exemptions ($69,165,084) than its downstate peers, according to the report.
“Nassau granted $23,611 in exemptions for every job it gained, eclipsing Suffolk ($644) and Westchester ($1,563), according to the report. DiNapoli’s office calculated the state median at $2,095 per job gained.
“In addition, Nassau recouped just 37 percent of the exemptions through payment-in-lieu-of-taxes agreements with businesses, less than the 59 percent recovered by Suffolk and the 67 percent Westchester got back. Nassau issued $43,325,571 in net tax exemptions — tax exemptions minus payments in lieu of taxes — greater than the $13,164,205 issued in Suffolk and $25,730,802 in Westchester (“Big tax breaks, few jobs from county IDA: Report“).
Nassau County should be a leader in Research and Development of new technologies – stem cell research, Alzheimer’s, renewable energy solutions, the list goes on and on. Our high school students consistently become the Siemens and Intel winners, yet they have to go to Silicon Valley and NYC’s emerging technology centers because there is nothing for them in Nassau County when they graduate college.
Ineffective, misguided economic development is one side of the inept leadership this County has suffered. The other side is the corruption and cronyism that passes for a “budget” process.
Nassau County is again headed for a fiscal abyss, as George Marlin, a former NIFA member, said. “One thing I can say with certainty after serving four years on as a director on NIFA is that Nassau County is in protracted fiscal crisis- weak leadership governed by press release.” Budget deficits are projected to hit $210 million in 2015, $259 million in 2016, and $325 million by 2018.
“Rather than balancing the budget in accordance with generally accepted accounting, the Mangano administration has reverted back to the techniques of 1990s,” he said, noting that he was not surprised by DA Singas’ report describing “a recipe for corruption because [the procurement process] is not insulated from improper influence, collusion and fraud.”
“We are reaching a point where county will be on edge of insolvency. This administration believes you balance the budget by borrowing money – that game ends sooner or later. Unless you are bonding to build something – a road that lasts 20 years or a building for 50 years – to borrow to pay present and current bills is like paying your mortgage on credit card.”
Marlin at a public hearing on Oct. 16 convened by the Minority Caucus on reforming the Nassau County contracting and procurement process. It might as well have been a surreptitious meeting of revolutionaries, stuffed into this tiny meeting room because the Presiding Officer Norma Gonsalves refused to allow the hearing to be held in the Legislative Chamber and Republican legislators refused to participate. (And just for spite – and to stick an additional “Stay Out” sign on the hearing, half of the Visitor Parking Lot was coned off.)
The Democrats are seeking a formal process to require consultants, contractors and vendors – in addition to lobbyists – to register and disclose their activities with the County Attorney – a proposal that arose from the investigation into Senator Skelos’ lobbying activities on behalf of Abtech Industries.
“Beginning with the Abtech scandal,” Minority Leader Kevan Abrahams stated, “we have had continuous revelations of apparent abuses in the county process for doling out lucrative public contracts. the impression is that cronyism, favoritism and waste are rampant. We spend hundreds of millions of dollars in taxpayer money on tracts every year. but the public no longer trusts that we are spending their money honestly, wisely or effectively…”
Abrahams went on to note that Presiding Officer Norma Gonsalves has stymied good-government reform – at first refusing to consider a Democratic bill requiring lobbyist disclosure with every County contract and then passing a watered down version; refusing to take up a bill to eliminate the so-called 45-day rule, which allows contracts to pass by default without public debate or legislative scrutiny. Similarly, Gonsalves has ignored a bill based on recommendations from Acting District Attorney Madeline Singas for an independent office of Inspector General.
“At a time when we desperately need openness and transparency in Nassau government, the Presiding Officer has shut the door on reform. She has literally locked us out of the legislative chamber in an attempt to keep us silent…The Legislative Chamber is the people’s chamber not the Presiding Officer’s private domain. How can we hope to reform the process when the Presiding Officer has shut down the process of reform?”
The hearing – as proper hearings do – brought forward a number of excellent recommendations, that in a functional government would have resulted in some productive legislation.
“Our procurement process is a recipe for corruption,” Acting District Attorney Madeline Singas told the hearing, noting that her investigation found contracts some worth tens of millions of dollars, that went to firms with past ties to organized crime and bid riggers. …Archaic paper based system makes proper tracking and oversight virtually impossible – it is slow, burdensome, inefficient. The current system provides no means to use modern analytics to find improper conflicts, gifts. Use technology to reform.
She proposed ways to “level the playing field, eliminate the pay-to-play system that has plagued county government for decades,” including enhancing disclosure to prevent conflicts, insulate against improper influence and provide comprehensive oversight.
Among the recommendations:
Establish an independent office of Inspector General, with subpoena power
Go paperless with a technological platform that comprehensively tracks bids, contracts and vendors
Modernize public employee financial disclosure with electronic filing
Increase oversight and transparency
Increase scrutiny of contracts that fall just short of thresholds
(See the recommendations at www.nassauda.org)
Another vulnerability are the contracts that are designated “emergency,” often handed to the Legislators just before they are expected to vote, with no opportunity to vet them.
“Emergency contracts should be the exception, rare, and truly in response to an emergency, otherwise, there should be time to properly vet them,” said Singas. Digitizing the information, so that the legislators do not have to rely on paper records, “would go a long way.”
Legislator Delia M. DeRiggi-Whitton also pointed to “a number of subcontractors given contracts, within a week, a number of donations made – that’s so blatant. There should be a way to track.”
Singas replied, “There should be able to track donations or other quid pro quo – and crosschecked.”
“I am all for more transparency, more people being involved in the system, to make sure everyone’s rights protected,” Singas added. “The information that made it to your level was not sufficient – information you had before you acted was woefully inadequate. It would not stand scrutiny in most governments across this country. Nassau County needs to modernize, to be more transparent. People need to know who is obtaining millions in contracts, to have to have confidence our money being spent wisely.”
There are real consequences and not just in high property taxes: “If $200,000 were diverted to a different purpose, those are funds that could have gone to youth services or health service” which Mangano has consistently slashed from the budget, Legislator Carrie Solages noted.
“No doubt, money squandered in one area means it is kept from another,” Singas replied. “This is very core process that we undergo every day in government – how contracts are handed out, where are the tens of millions of dollars are going.”
Paul Sabatino, the former Chief Deputy County Executive of Suffolk County, said it boils down to the need to “change the culture” and proposed requiring the government officials certify a contract in addition to the vendors that there is no undue influence.
“You need to put restrictions on contributions in the county charter –that anyone who makes contribution in 24 months before bidding on contract would be disqualified to bid post contract may be a good idea, too – so 24 months before & 24 months after.
“Change the mentality, change the culture, change the way people think about approaching contracts,” he said. “Put at the top of every contract:
Think before you sign
No county official shall sign unless can state under oath that to best of knowledge, awarded by NC in accordance:
Prudent and economical use of public money in best interest of taxpayer
This contract insures acquisition of goods, materials, supplies, infrastructure of maximum quality at lowest cost
Award of contract does not reflect favoritism, influence peddling, fraud, corruption
“These are essential, core principles of municipal contracting that everyone has to understand. When you are the person who is going to sign the contract – whether Assistant DA, deputy county executive – and you see those words, you will take pause.
“The idea is to get people on both sides of the transaction – the vendor who on pain of perjury certifies he has not made contribution, offered a gift, or made a promise to secure the contract and the officials signing the certification also.”
He also recommended that contracts should be assigned to the committee with prime jurisdiction over that function – ie. public works contract should come through public works; drug and alcohol should come through health committee. You need a robust active oversight function. That changes the whole history of the way Nassau County has worked. Things are so bad, you need to think radically, but it’s not really radical. It’s going back to the roots of how procurement should work.”
Lisa Tyson, executive director of the Long Island Progressive Coalition, wants to go even further, connecting the corruption of the procurement process to campaign finance.
“If you really want to save tax payer dollars and end corruption, we need systemic reform. Small donor campaign financing would eliminate the incentive. Legislators wouldn’t need to collect large contributions, but instead, would raise small contributions from a lot of voters, which would be matched [in NYC, the donations are matched 6 to 1]. Then the official would be ultimately accountable to voters, not big campaign donors. Systems like this are being done around the country. The time has come for Nassau County.
“It’s embarrassing the amount of indictments and corruption charges, even for New York standards which are quite low. It has hit home on Long Island. New York corruption issues are so severe that only bold action that hands back control to voters through campaign finance, can solve it,” Tyson said.
What was Norma Gonsalves’ reply to Minority Leader Abrahams’ request for a public hearing on procurement? She scolded him.
“You have been a member of this Legislature long enough to know that pursuant to our Rules of Procedure, no member of the Legislative Minority, not even the Minority Leader, may unilaterally convene a hearing of the Legislature or any of its committees,” she wrote, as if this procedure was somehow enshrined. “Be advised that I will not allow this process to devolve into a political circus and I will not allow unilateral hearings to be conducted in the Legislature Chamber.”
It is sad that the way Republicans have chosen to control county government is by controlling absolutely and minimizing, dismissing, marginalizing any proposals that come from the Democrats. If the Democrats were in control of the Legislature today, I would be just as critical if they practiced this form of exclusion – except when they were in control, they didn’t. At least not like this.
Where is it written into the foundational documents of this nation’s democracy that the winning party represents only its own constituents and makes all others “persona non grata” – not even non-citizens, but invisible altogether, having no voice, no power, no consideration at all?
Republicans at every level of government have proved regressive, corrupt, benefitting only a slice of those with connections or influence. They have demonstrated their contempt for the concept of government.
And that’s why Norma Gonzalez, with the power she wields, denied a public hearing over corruption in the county’s procurement process.
And it is why elections matter, especially local ones which put into place the officials who make decisions closest to our everyday quality of life.
Vote Tuesday, November 3.
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