Page 1

Vol. 1, No. 9

www.cityandstateny.com

April 2, 2012

As Albany deals the cards, casinos make their wagers on gambling in New York. Page 12

DAVID KATZ/ARNOLD KATZ PHOTOGRAPHY

The state budget is just full of surprises. Page 6

Manure runoff from upstate farms is making green advocates see red. Page 7

Race, ideology and borough politics in the race for City Council speaker. Page 9

Albany Assemblyman Jack McEneny says goodbye, but not for good. Page 23


UPFRONT

SOMEONE HAS TO KEEP THEM HONEST I note this because after almost two decades side newspapers and TV. Bloggers working With the state budget finished and Mayor Michael Bloom- as a reporter, I am leaving for what journalists for free are scooping the establishment, berg lovey-dovey with Gov. call “the dark side.” I will be a spokesman for forcing everyone to work harder and better. And I am especially proud of City & Andrew Cuomo again, the Metropolitan Transportation Authority, on calm and stability have the other end of the phone for all those tough State, which was a glimmer in an editor’s eye six years ago and is now an established broken out in New York questions and uncomfortable stories. And while I’m excited to try something new and serious competitor. I am counting government. I consider this a for a cause I believe in, it’s agonizing to leave a on a talented and dedicated team here profession that is so vital for New Yorkers who to keep exposing the truths that Bloomproblem. Adam Lisberg berg and Cuomo would like to bury under Cuomo has mastered want to keep their leaders honest. EDITOR But I am bullish on its future. New bland press releases. the art of bringing almost I look forward to reading it. So should everyone to the table when he makes a deal, online news outlets, freed from the costs and striking fear into the hearts of anyone of printing presses, are breaking news everyone else in New York. editor@cityandstateny.com who would dare stray. Bloomberg’s adminis- and telling uncomfortable truths alongtration is slipping from the autumn to the winter of its years, but New York City is still BY T H E N U M B E R S B U D G E T G A P ? I T D E P E N D S . full of people who would never criticize New York City Mayor Michael Bloomberg introduced a budget plan in February, it wasn’t the final him publicly. Democracy is messy; they do When word. Four other government bodies produce their own reports on its assumptions, and they don’t all agree. their best to keep it clean. Here’s what they expect the city’s budget gap to be over the next four years. That leaves the media. $500 Someone has to keep Cuomo and $0 Bloomberg honest. Somebody needs to Budget gap do the tough reporting when they break -$500 projections their promises, when their agencies go wrong, when they fall short of the high -$1,000 in millions standards they set for themselves while -$1,500 running for office. The reporters and bloggers and even photographers who cover city and state -$2,000 government have plenty of wrongheaded -$2,500 Bloomberg administration excesses, but at our best we stick up for NYC Council everybody else in New York—the people -$3,000 NYC Comptroller who don’t go to press conferences, who NYS Comptroller NYS Financial Control Board can’t get a commissioner on the phone, -$3,500 NYC Independent Budget Office who deserve someone on their side when -$4,000 they think an emperor has no clothes. 2012 2013 2014 2015 2016

EDITORIAL Editor: Adam Lisberg alisberg@cityandstateny.com Managing Editor: Andrew J. Hawkins ahawkins@cityandstateny.com Reporters: Chris Bragg cbragg@cityandstateny.com Laura Nahmias lnahmias@cityandstateny.com Jon Lentz jlentz@cityandstateny.com Copy Editor: Helen Eisenbach Photography Editor: Andrew Schwartz Interns: Michael Mandelkern ADVERTISING Associate Publishers: Jim Katocin, Seth Miller Advertising Manager: Marty Strongin Senior Account Executives: Ceil Ainsworth, Monica Conde Director of Events & Special Projects: Andrew A. Holt Executive Assistant of Sales: Jennie Valenti PRODUCTION Art Director: Joey Carolino Production Manager: Ed Johnson Ad Designer: Quarn Corley MANHATTAN MEDIA President/CEO: Tom Allon CFO/COO: Joanne Harras Digital Director: Vincent DiDonato Editorial (212) 268-3235 Advertising (212) 284-9712 advertising@cityandstateny.com General (212) 268-8600 City & State is published twice monthly. Copyright © 2012, Manhattan Media, LLC

AROUND NEW YORK The best items from The Notebook, City & State’s political blog City & State’s political blog, The Notebook, is your key source for political and campaign developments in New York. Stay on top of the news with items like these at www.cityandstateny.com/thenotebook.

ROCHESTER In Gov. Andrew Cuomo’s announcement reshuffling the leadership of his Spending and Government Efficiency Commission, he left out one key reason for the change at the top: Antonio Perez (left), the Kodak chief executive brought on for his “business acumen,” had to step down as commission co-chair because his company’s finances had tanked. “He has resigned from those positions because of the bankruptcy so he can focus on the business and the urgency of giving attention to the business at this time,” Chris Veronda, a Kodak spokesman, said earlier this year.There may be little change with Perez out, however:The man actually running the commission appeared to be Paul Francis, with Perez acting more as a figurehead.

The governor was supposedly in Albany with no public schedule March 7, but he made time to come to the Casa Lever restaurant on Park Avenue for a $15,000-a-head fund-raiser. Maybe that’s not unusual for a popular governor with at least $14 million in his war chest, but given the pension battles brewing at the time, it’s notable that several labor figures were there, including HotelTrades Council President Peter Ward (left). Private-sector unions and the building trades are apparently still in the governor’s corner, even as public-sector unions fume. Also notable: Casa Lever is on the ground floor of Lever House, owned by Michael Fuchs (a $45,000 Cuomo donor) and Aby Rosen (a $105,900 Cuomo donor with his wife), who Cuomo appointed last year to chair the Council of the Arts. APRIL 2, 2012

Amy Tresidder (left), a Democratic Oswego County legislator, is preparing for a run against State Sen. Patty Ritchie, a first-term North Country Republican. “Right now I’m pretty certain I’m going to run,” Tresidder said. “You know what the economy is like right now, and people are unhappy with the status quo.” Ritchie’s 48th Senate District has significantly more Republican voters than Democrats, butTresidder said she said it is critical to offer voters an alternative. Darrel Aubertine, a popular Democrat and a veteran lawmaker, held the seat before Ritchie, after winning it in a special election. Despite heavy spending by the Senate Democrats, Ritchie ousted him in 2010 with 53 percent of the vote.

QUEENS

MANHATTAN

2

NORTH COUNTRY

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Former Queens Sen. Frank Padavan (left) says he still hasn’t made a final decision about making a comeback run for his old seat. But Padavan made clear he’s not exactly thrilled about the job being done by his Democratic successor, State Sen. Tony Avella. “Ah, you don’t really want to get me into that, do you?” Padavan said when asked about Avella’s job performance. “You really don’t want to go there.” Sources say Padavan has been spending an unusual amount of time recently at Queens Republican headquarters, keeping a close eye on how redistricting played out. One enticing factor for Padavan is a potential primary between Avella and fellow Democratic State Sen. Toby Ann Stavisky, who were paired in the same district. Avella says he’s definitely running for reelection to his Senate seat, while Stavisky says she’s also running, but hasn’t decided in which district.

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April 2, 2012

3


TM

UPFRONT BILL OWENS 63 (2)

AGE IS JUST A NUMBER With new district lines in place, some of the older members of New York’s Congressional delegation—average age 62, in office an average of 13 years—are facing younger challengers. Here’s how their ages and seniority compare:

BRIAN HIGGINS 52 (7)

AGE

YEARS IN OFFICE

REPUBLICANS

55

3

DEMOCRATS

64

16

WOMEN

62

12

MEN

61

22

NYC

63

18

REST OF NY STATE

61

8 AGE:

CHRIS GIBSON 47 (1)

ANN MARIE BUERKLE 60 (1)

KATHY HOCHUL 53 (0)

THE AVERAGES:

YEARS IN OFFICE:

LOUISE SLAUGHTER 82 (25)

CHARLES RANGEL 81 (41)

CAROLYN MALONEY 66 (19)

TOM REED 40 (1)

JOSE SERRANO 68 (22)

RICHARD HANNA 61 (1)

JOE CROWLEY 50 (13)

STEVE ISRAEL 53 (11) PETE KING 67 (19)

YVETTE CLARKE 47 ((5)) MICHAEL GRIMM 42 (1) NYDIA VELÁZQUEZ 58 (19)

MAURICE HINCHEY 73 (19)

GARY ACKERMAN 69 (29)

JERROLD NADLER 64 ((19))

ED TOWNS 77 (29)

GREG MEEKS 58 (14)

CAROLYN MCCARTHY 68 (15)

NAN HAYWORTH 52 (1) NITA LOWEY 74 (23) TIM BISHOP 61 (9) ELIOT ENGEL 65 (23)

BOB TURNER 70 (0)

THE FOOTNOTE: A real press release, annotated Sent 1:47 p.m. Tuesday, March 27, from Gov. Andrew Cuomo’s press office The Partnership for New York City was so excited it sent out a press release hailing the budget deal 18 minutes before it was offi cially announced.

PAUL TONKO 62 (3)

New York’s business community, which spent $12 million on lobbying to support Cuomo’s agenda last year through the Committee to Save New York, is ecstatic.

Don’t be shocked if dozens S, GOVERNOR CUOMO, MAJORITY LEADER SKELO of them hold ribbon cuttings ET BUDG 013 2012-2 ON MENT AND SPEAKER SILVER ANNOUNCE AGREE in the months leading up to today Silver n Sheldo r Speake bly Dean Skelos and Assem Cuomo’s reelection bid in 2014. Governor Andrew M. Cuomo, Senate Majority Leader State Budget. announced an agreement on the 2012-2013 New York hening strengt and jobs g creatin while sibility respon scal fi The Budget continues the Governor’s commitment to Danny Donohue, head of the spending dollar deficit with no new taxes, fees or gimmicks, limits communities across the state. It closes a multi-billion state workers’ union CSEA, New York Works Task Force to invest the es launch and row, a in year second the for growth to two percent or below said Cuomo’s job creation Another way of tens of thousands of jobs. create and ucture infrastr other and parks, , bridges billions of dollars to rebuild the state’s roads, claims are “nonsense” saying there’s still The key provisions of the Budget include: because state workers will $900 million to go. Cluster tion Innova al Buffalo Region lose their jobs to budget cuts. ic development package for Buffalo. econom billion $1 ear multi-y a of phase rst fi the for The Budget includes funding nds of jobs and spur thousa create to plan viable a p develo to il Counc al The Governor has challenged the area’s Region consisting . The Budget includes $100 million for the first year, The day after the budget passed, at least $5 billion in new investment and economic activity m. Progra ior Tax Credit Cuomo announced 300 new of $75 million in capital and $25 million from the Excels Transportation experts note olitan New York subway cars will guarantee 500 Funding the MTA Capital Plan to Improve Transit in Metrop $7 billion will be paid for with of direct funding from million $770 with MTA the of funding full t suppor to jobs in upstate Plattsburgh. The Budget includes the Governor’s plan City, Long Island York borrowed money, which MTA riders New in transit to critical s project for billion the state. The five-year MTA capital plan contains $22.2 will have to pay back over time. The first two years of the MTA capital plan were jobs. of nds thousa of tens e produc will that and Valley, and the Hudson billion needed to achieve the five year $13.1 full the obtain to MTA the allow help will t funded at $9.1 billion. The Budge Has Cuomo mentioned ction projects in the history of New York. capital plan and complete some of the largest constru he passed a property State Spending Growth Held to 2% Cuomo wanted to allocate even percent or less year to year growth in state spending, tax cap last year? For the second year in a row, the Budget maintains two more through competitive grants, $88.8 billion in 2012-13. The imately approx total will Funds State ments. govern local consistent with the tax cap on to reduce duplication, ons operati but lawmakers pared it back to keep agency of n redesig g ongoin the through Budget achieves flat state agency spending tive $72 money flowing to local school boards. office, out year deficits have been reduced by a cumula took Cuomo raised income taxes Cuomo or Govern Since waste. and ancy redund on the richest New Yorkers in ce. offi billion since taking December, raising $2 billion Government Performance and making it easier to balance Increase in School Aid: Legislators and government for school aid, including performance grants to reward the budget in March. The Budget includes a total of approximately $20.4 billion watchdogs fear this gives Cuomo nts an increase of $805 million in total education represe This s. ciencie effi district school and ement academic improv s. enormous power to spend money district school needs high to d targete e increas ed spending, with most of the allocat however he wants, despite Interchangeability or’s Govern what the Senate and Assembly While some school districts and improve performance, the Budget enacts the To achieve greater efficiency in government operations consolidation and streamlining. The interchangeability ment intended. may still have to make cuts, govern te expedi to order in exibility fl scal fi proposal to ensure in back office Mayor Michael Bloomberg said provisions give the state the authority to move certain funds between state agencies that will save money ns functio move to state logy and call centers. This will allow the increased school funding is functions such as business services, information techno ers. The ensure better performance, and reduce costs for taxpay ciency, effi e part of why this was the best improv State Comptroller Thomas to r anothe to agency state one from es. agenci functions of the legislative session for New DiNapoli, who used to do those transfers will not be used to alter or shift programmatic York City in a decade. reviews, would beg to differ. He Transforming State Procurement Process the rating accele ts, ul review of statewide centralized contrac said he’s withholding judgment The budget further eliminates the duplicative and wastef le. possib as soon as s saving e achiev and ts on the new budget. opportunity for agencies to use the new centralized contrac If Cuomo is consolidating Foreclosure Relief Unit and Homes through s service ling mortgage foreclosure counse agencies, why is foreclosure The Budget provides $9 million for the continuation of ent with proceeds of the National Mortgage Servicing Settlem prevention spread between Community Renewal, with additional services financed to provide Unit Relief sure Foreclo new a sh establi will s Service two of them? Agreement. In addition, the Department of Financial stay in their homes. counseling and mediation services to help New Yorkers

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APRIL 2, 2012

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CITY&STATE


Governor Cuomo, State Senators and Assembly members vote a perk for themselves… at your expense…in the dead of night. Their pension “reform” includes a giveaway – worth thousands of taxpayer dollars – to legislators and political appointees. Taxpayers are on the hook for 8 percent of the political employee’s salary. Every year! All this, done in the dark.

While frontline workers are required to work ten years to vest in their pension program, these politically favored few can skip out overnight, taking plenty of taxpayers’ money after just one year of service – it’s an extra cash bonus they did not earn.

The Governor, Senators, and Assembly members put politics before people.

Call Governor Cuomo and your State Senator and Assembly member:

1-877-255-9417

Tell them to fix this political boondoggle now! CITY&STATE 8793_Dark 10x12.75 CS.indd 1

www.cityandstateny.com

LOCAL 1000 AFSCME, AFL-CIO DA N N Y D O N O H U E , P R E S I D E N T

April 2, 2012

5

3/22/12 11:43 AM


surprise!

THE INVISIBLE TASK FORCE

The new state budget is full of costly secrets if you know where to look

The Legislature needs another year to pass a constitutional amendment creating a bipartisan commission to draw new district lines in the year 2022, so in the meantime the state got to keep paying for its old LATFOR, the Legislative Task Force on Reapportionment. The state will keep paying for its salaries, for its travels, for whatever it is a task force that draws lines does when it isn’t drawing lines.

By Laura Nahmias

W

hen New York passes its state budget each year, lawmakers, advocates and budget wonks start unwrapping hundreds of pages of legalese in search of all sorts of secret things buried inside them. It’s a sort of bizarre Christmas Day, but instead of squealing with joy when they find surprises, they usually run screaming in the other direction. Here’s a sampling of what they’ve found so far.

$358,325

lnahmias@cityandstateny.com

Price................................ istockphoto

MAGIC SCHOOL BUS

PENSION SWEETENING POWER

HIDDEN PORK PET PROJECTS

The governor bragged there were no new member items this year, but right there on page 45 of the state’s revenue bill is a nifty paragraph requiring the state comptroller to move up to $38 million from special revenue funds into the Community Projects Fund, the manure-fertilized pasture from whence all pork projects spring. The explanation seems to be that the money helps to fund old member items, but the secret trick is that in years past the Legislature gave themselves special power to spend the money any old way they wanted, which is why new member items kept getting approved last year and may continue to be approved this year.

$38 million

Price.............................................

Be The One That Giveth and also The One That Taketh Away! This magical provision, first uncovered by Daily News columnist Bill Hammond, gives New York City mayors and New York State governors the power to add to public employees’ pensions, a thing that the Legislature used to do for different pensioners in single bills all in the course of a day’s work. But the greatest thing about this power is that it came about by passing bills in the middle of the night, when lawmakers were too tired to read through them.

$80 billion

Price..........................................

Private schoolers—ride to school on the city’s dime! This one didn’t actually happen, but it almost did. Mayor Michael Bloomberg flipped when it looked like the Legislature would include an item in the budget requiring the city to pay for new school buses for private school kids, a little gem the city likes to call “an unfunded mandate.” But the magic school bus is important to the Legislature, so they decided to pay for it themselves. The kids go to school, the city keeps the change, everyone is happy, and budgetscanning hypervigilance pays off for the Big Apple.

$3 million

Price...........

FUTURISTIC INTERNET PHONE What’s an “Internet telephone,” pray tell? It communicates through a series of tubes instead of boring old copper wires, and that’s a good thing for the wizards of telecommunications, who slipped an ALEC-written bill into the budget preventing future regulation of Internet phone services. What’s an ALEC? The American Legislative Exchange Council, a business-funded conservative group that writes bills that seep into state legislatures. Union groups like Communication Workers of America were horrified to see this bill in the budget. They’ve convinced the governor to take it out, but who knows where ALEC will strike next? The Shadow knows…

Support from Working Families Party-linked unions

Price......................

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april 2, 2012

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CITY&STATE


nEw RulEs FoR BRown FiElds?

Executive MPA

By Eliza Ronalds-Hannon

W

hen heavy December rainstorms washed thousands of gallons of cow manure at an upstate dairy farm into Cayuga County watersheds, the farm was cited for violating state water quality standards. But the farm’s managers had done everything by the book. Twin Birch Farms, a 2,000-cow operation in Skaneateles, broke no rules when it spread manure across its fields without tilling the manure into the ground. Within hours of the Dec. 21 downpour, frothy discharge was gushing into tributaries of Owasco and Skaneateles Lakes, which supply the drinking water for much of Cayuga County. Tests showed the contamination was absorbed before it reached the lakes, but regulators were worried. “When we showed up, it looked like a disaster,” said Owasco Lake Watershed Inspector Katie Jakaub. “There was a lot of foam.” To state environmentalists, the spill was another argument for stricter farm regulations as climate change increases the likelihood of catastrophic flooding— even as farmers say their hands are already tied by bureaucrats. One of the strongest advocates for reducing environmental regulations, Rep. Ann Marie Buerkle, has a family summer cottage on Skaneateles Lake just three miles from Twin Birch Farms. “Small and medium-sized farms in New York need all the tools possible to remain profitable, and in doing so contribute to our local and national economy,” Buerkle says on her website. “Our agriculture can compete in a free world market if we do not hinder it with excessive regulations.” She did not respond to a request for comment about the spill. At a recent meeting with farmers in her Central New York district to discuss the industry’s obstacles, Twin Birch Farms owner Dirk Young spoke up, saying the government has too much say in how farms are run. “The government needs to get the hell out and let us work,” Young said, according to the Syracuse Post-Standard. He did not respond to requests for comment, but DEC records show his farm was cited for two previous manure spills. Commercial farms generate far more manure than their owners can use as fertilizer, and farmers are permitted to dispose of the excess by spreading it on their own land. They must state their plans to do so in nutrient-management plans, which are sent annually to the state Department of

CITY&STATE

Hobart and WiLLiam SmitH CoLLEgES, FingEr LakES inStitutE

Manure rolls downhill into upstate drinking water

School Of International and Public Affairs

Environmentalists fear manure runoff from nearby farms could endanger the Cayuga Lake watershed.

Environmental Conservation. Aside from the obvious unpleasantness and the dangerous pathogens that come from dumping animal excrement in drinking water, manure contains nutrients that feed aquatic weeds and algae—starving the water of oxygen and killing fish. “Do I think that the [farm] regulations need totting up? Yes,” said Charles Greene, president of the Owasco Watershed Lake Association. “Given the prevalence of seasonal waterways on most dairy farms, there needs to be very careful attention to the moisture conditions in the soil and also the upcoming weather.” Climate change also poses a threat to water quality, as storms once thought to take place only every 50 or 100 years have become regular threats. “The hundred-year storms sometimes come every couple of years now,” said environmental lawyer and Columbia University Law School professor Reed Super. “Climate change is typically not taken into account in any weatherrelated aspect of environmental law to the extent that it should be.” DEC has only 20 staff members assigned to inspecting the state’s 36,000 large farms but said in a statement that inspectors routinely conduct compliance inspections in their respective regions. “DEC is constantly working with other state agencies and stakeholders to ensure the proper administration of the program,” said spokeswoman Lisa King. But farmers’ advocates argue that the industry already faces a heavy burden from government regulation. “It’s never been our experience that government and environmental regulators are too easy on farms,” said Matt Nelligan of the New York Farm Bureau. “What we do here clearly is more restrictive and progressive than what happens in the rest of the country.” editor@cityandstateny.com

Join us for our Upcoming Open Houses from 6–8pm: Wednesday April 11th, 2012 Wednesday June 6th, 2012 Partial Scholarships Available For New York City Employees

RSVP: empa@columbia.edu or (212) 854-5124

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7


ALL THAT GLISTENS IS NOT GOLD Affordable Housing in the Hands of HPD Meet Anita Clark. She is a single mother and a loyal caretaker to her daughter and elderly mother. She is a 25-year veteran of the New York City Police Department – a public servant with a lifelong dream of one day owning a home. She lived her life embracing hard work, integrity and faith, until that day finally came. Winning an affordable housing lottery allowed Anita to purchase her dream home in Brooklyn, NY. Shortly thereafter, her dream come true became her worst nightmare.

Photo by Don Pollard

A Shocking Wake-Up Call

The New York City Department of Housing Preservation and Development (HPD) is the largest municipal developer of affordable housing in the nation. This administration’s housing agenda, The New Housing Marketplace: Creating Housing for the Next Generation is an $8.5 billion plan and the largest investment in the City’s housing stock in 20 years. (http://www.nyc.gov/html/hpd) Anita Clark’s story came to light when the NBC show George to the Rescue chose her house as the kickoff project of their third season. Having won an HPD affordable housing lottery to purchase a brand-new house two years prior, Anita was overjoyed at the prospect of finally owning a home. Becoming a homeowner was one of her biggest accomplishments, a payoff for a lifetime of hard work. The George to the Rescue team came in to tackle a big problem – improper plumbing under Anita’s house was triggering constant floods of sewage directly into her bedroom. Joined by Eamon Roche from Roundtable Builders, Barbra Moore from B Moore Design and local union workers from the New York City Building and Construction Trades Council, the team set out to restore Anita’s dream home. What they found was more than they bargained for.

The Anatomy of an HPD House PLUMBING: The plumbing system in Anita’s home was a model of substandard, incompetent workmanship. The sewer system was back-pitched and with the backage drain situated directly next to her bedroom, raw sewage was constantly seeping into Anita’s carpet. Many of the pipes in the home were cracked, which occurred as a result of improper sealing. Many of the pipes used in the plumbing system were PVC instead of cast iron and had the potential to leach harmful chemicals into drinking water at levels above the maximum allowed contaminant level. The bathroom pipes were crimped, a temporary solution used during the construction phase which should not have been made permanent. The pipes were left uncapped and had the potential to burst at any time. The house was equipped with an undersized boiler, putting an already strained plumbing system in even greater risk.

DECK: The deck leading to the backyard was another area in need of major attention. The standing post for the deck had twisted almost a full 90 degrees in only two years. The deck railing was spliced; it was cut short initially & then added onto. Another prime example of shoddy construction work, the deck was constructed using substandard wood, undersized joist hangers and interior screws that rusted immediately. The risers were constructed incorrectly and the stairs were near collapse, a potentially deadly situation for Anita’s elderly mother.

ELECTRICAL: Upon closer inspection, the team found that the house electrical system was illegally wired. The Ground Fault Interrupters (GFIs) were never grounded or waterproofed – if they were ever to come in contact with water, residents would be susceptible to deadly electric shock. The electrical system was not coded properly, as required by the National Electric Code, leaving the house in danger of electrical fires. The lack of fireproof insulation in the walls would ensure that the house could not withstand even a small fire.

HEATING: In addition to a lack of fire insulation, the standard wall insulation was not up to par, leading to costly heating bills. This three-story two-family house was equipped with only one zone system and one thermostat, further driving up the costs of heating. The windows were not matched to their frames, causing constant leaks and exposure to the elements, another contribution to increased heating costs.

ROOF: A standard problem in too many HPD residences, the leaky roof in Anita’s home was an even bigger problem without a waterproofed electrical system. These critical maintenance issues required immediate attention to ensure the safety of Anita and her family. Due to the massive privatization of the affordable housing program that allowed her to purchase the home, HPD held no accountability for the shoddy construction work that left her with a nightmare on her hands, making Anita responsible for funding the repairs on the home. Anita’s case is indicative of the deep-rooted issues in affordable housing programs in New York City including careless construction, lack of government accountability and failure to disclose property conditions prior to sale.

Built With Private Funds, Funded By the Poor HPD has made a decisive shift away from City ownership of properties and has developed innovative community revitalization initiatives that promote private investment and productive public-private partnerships. HPD aims to strengthen neighborhoods, increase the availability of well-maintained, affordable housing and enable more New Yorkers to become homeowners. (http://www.nyc.gov/html/hpd) Although Anita’s brand-new home desperately needed repairs in her first two years of ownership, it was she who would be responsible for paying the costly bills. Due to the massive privatization of the program that allowed her to purchase the home, HPD and the City of New York held no accountability for the shoddy construction work that left her with a nightmare on her hands. In fact, when homeowners like Anita appeal to HPD for help, they are told that these problems are always a maintenance issue. Owning a home for the first time (as required to qualify for the HPD lottery), these purchasers are informed that they have no idea of how to properly maintain it and are themselves causing the issues. Today, there is no recourse for individual homeowners. (Please look for the second installment of this article in the April 16, 2012 issue of City & State)

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April 2, 2012

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QuInn: AnDreW SChWArtz

speeCh Class Race, ideology and county politics at play in race for next Council speaker By Chris Bragg

P

icking a New York City Council speaker used to be fairly straightforward. County leaders of the five boroughs cut deals. Jobs were promised. Votes were wrangled. Arms twisted. But a couple of new elements in the race to replace term-limited Speaker Christine Quinn in 2014, involving ideology and race, are taking things into uncharted territory. The three main candidates are thought to be Manhattan Councilwoman Inez Dickens, who is AfricanAmerican and a favorite of the Harlem establishment; Manhattan Councilwoman Melissa Mark-Viverito, the Hispanic co-chair of the Progressive Caucus; and Queens Councilman Mark Weprin, who is white and favored by the famously cohesive (and influential)

Queens Democratic Party. The Council’s Black, Latino and Asian Caucus has grown to 27 members, making the Council majority-minority for the first time. And there’s pressure for everyone involved to pick the Council’s first minority speaker—especially if the mayor ends up being someone who is white like Quinn, Manhattan Borough President Scott Stringer or Public Advocate Bill de Blasio. If Quinn, the current front-runner, is elected, allies of Dickens believe she would have the speakership all but locked up. “If the mayor’s white, the speaker can’t be, and vice versa,” said one uptown Manhattan ally of Dickens. “Assuming the mayor is white, the speaker is most likely going to be Dickens.” But the situation is made more complex because of a split in the Black, Latino and Asian Caucus between the establishment (which makes up the

Follow The leader Borough bosses are always key to picking a speaker Even before there was a City Council speaker, horse trading for the Council’s top job was rampant. Queens Democratic Councilman Peter Vallone Sr. became the first speaker after the City Charter was revised in 1989. But before that, he was elected majority leader in 1986, replacing 16-year incumbent Thomas Cuite. And though Vallone was the early favorite for that post—he had lined up support from his home borough, the Bronx and Staten Island—his selection was thrown into doubt days before the vote, when Manhattan leader Denny Farrell and Brooklyn boss Howard Golden decided to form an alliance behind Councilman Samuel Horwitz of Brooklyn. “Manhattan has been left out, but not anymore,” Manhattan Councilman Stanley Michels told The New York Times. Mayor Ed Koch backed Vallone, who ended up winning after furious lobbying from Democratic leaders of Queens and the Bronx. Vallone held the top spot on the Council for 16 years, giving up the position after losing a run for mayor in 2001. And as that year’s mayoral elections approached, with liberal Democrat Mark Green the front-runner, many Democrats in the City Council thought a moderate consensus builder might be the next speaker. But with the election of Mayor Michael Bloomberg, who had run on the Republican line, desire grew for a more confrontational speaker. Term limits pushed an unusually high number of Council members to consider

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running for speaker in 2001, including Gifford Miller and Philip Reed of Manhattan, and Tracy Boyland, Al Vann and Angel Rodriguez of Brooklyn. One stumbling block, the Times reported, was that a number of members in Brooklyn and Queens refused to follow their party chairman to make a deal. Miller and Rodriguez emerged as the front-runners, with Manhattan Councilman Bill Perkins as a darkhorse candidate. “This process has been one where we have felt a lot of competing forces,” Queens Councilman Eric Gioia told the Times. “I have been wooed so much, I felt like a shortstop who could hit for power.” Miller picked up the backing of labor unions, and won the speakership vote handily. In 2006, after Miller was termlimited, the two favorites were Manhattan Councilwoman Christine Quinn and Brooklyn Councilman Bill de Blasio. Quinn took the traditional approach of aligning borough support, while de Blasio tried to pick off support of individual Council members. In the end, Democratic leaders in Manhattan and Queens united behind Quinn, with Queens landing plum committee chairs like Finance and Land Use in exchange for letting Manhattan wield the gavel. “Anyone who wants to be speaker still has to do it through the county leaders,” said Baruch professor Doug Muzzio. “And Queens has been, and remains, at the center of that.” —Chris Bragg cbragg@cityandstateny.com

City Council members Mark Weprin, Inez Dickens and Melissa Mark-Viverito are all vying to replace Christine Quinn as speaker in 2014.

majority of the caucus, and supports Dickens) and members of the Progressive Caucus (which supports MarkViverito). Already tensions flared within the caucus earlier this year, when MarkViverito pulled out of a race for a leadership spot in the Black, Latino and Asian Caucus because she lacked support for reelection. Even though Dickens holds the majority of support in the Black, Latino and Asian Caucus, that bloc would still have to cut a deal with the leadership of at least one of the borough delegations. Meanwhile, the Council’s 12-member Progressive Caucus is looking to expand its ranks dramatically in the next election. With nearly half the Council set to be open seats, the Working Families Party is hoping to make a play in some 20 Democratic primaries, already identifying candidates to support. In lowturnout Democratic primaries, the WFP proved extremely formidable in 2009 against the Queens Democratic Party, though the WFP’s ground operation may be weakened by the demise of its for-profit campaign arm, Data and Field Services. One top progressive labor official involved with WFP strategy said the Progressive Caucus was considering teaming up with a county leader—like Brooklyn chair Vito Lopez or Bronx leader Carl Heastie—to be able to win a majority of votes on the Council for the speakership. “The thought is that a progressive candidate could win if you came up with a county,” the labor official said. But this is theoretical at best, and progressive members would have to ultimately choose whether to align with the WFP or their own county parties. Queens County sources believe only five members of the Progressive Caucus who will be around to vote in 2014— Mark-Viverito, Brooklyn Councilman Brad Lander, Manhattan Councilwoman Margaret Chin, Brooklyn Coun-

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cilman Jumaane Williams and Staten Island Councilwoman Debi Rose—are more loyal to the caucus than to their home county. Notably, none of those members hail from Queens. Queens County already has its own candidate in Weprin, an affable and popular figure among his colleagues. The borough has a mostly loyal and unified Democratic delegation, and even the Republicans in the borough are often inclined to vote with Democrats in a bloc. Queens seemed to double down on Weprin as speaker recently when it passed on selecting him as its candidate for the newly created Sixth Congressional District—a move that insiders say upset Weprin, who had long harbored congressional ambitions. Weprin also passed on running against the county organization’s pick, Assemblywoman Grace Meng. But even a unified Queens would need a dozen more votes to pick a speaker. In 2005, lacking enough votes, Queens supported Manhattan’s Quinn for speaker, in exchange for chairmanships of top committees like Land Use and Finance. Since the last speaker’s race, Heastie has been able to unify the Bronx, making that borough more of a key player. Brooklyn, while large, is split between allies of Lopez (a majority of its votes) and his political opponents. And Manhattan—the home of both MarkViverito and Dickens—is governed more by local neighborhood politics than by a central leadership. With no single bloc strong enough to elect a speaker, the final deal may well come down to horse trading among counties and patronage. “Anything could happen. Christine Quinn could get in there and ultimately appoint a couple of Vito’s people as commissioners,” said one source close to the Queens Democrats. “It has to be built with a coalition. Nobody can do it on their own.” cbragg@cityandstateny.com april 2, 2012

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As Albany deals the cards, casinos make their wagers on gambling in New York

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n late October of last year, a group of politicians, public officials and corporate executives gathered in southeast Queens to cut the ribbon on New York City’s first casino, a massive facility erected next to Aqueduct Racetrack. As they took turns congratulating themselves for getting Resorts World Casino New York City up and running, the signs of its success could already be seen just around the corner, where thousands of gambling fans had lined up in the cold to try their luck. When the speeches came to an end, the assembled dignitaries trooped inside to warm up, drop a few dollars on one of the nearly 2,500 new jangling, flashing slot machines or mingle with the Elvis, Tina Turner and Lady Gaga impersonators brought in for the opening day. But already they saw something bigger ahead. Taking in the scene, several lawmakers predicted the Resorts World opening was a prelude to another wave of ribbon cuttings in the coming years, thanks to Gov. Andrew Cuomo’s push to legalize Las Vegas-style casinos with full-fledged table games. “I can speak for the Assembly: There’s no opposition,” Assemblyman Gary Pretlow, chairman of the Racing and Wagering Committee, said that afternoon. “I’m pretty sure the Senate feels the same way. Now the governor is in favor, and that will bode for well for casino gaming.” Within 40 hours, more than 65,000 people had visited, and the casino had netted more than $3 million in revenue. And the surprisingly strong

pace has hardly let up since. As for Pretlow, his bet has been right on the money too. Last month lawmakers took a critical step forward with a resolution to amend the state constitution to allow commercial casinos in seven yet-to-be-specified locations across the state. Before they’re allowed, though, the resolution must be approved next year by a newly elected Legislature, then go before the state’s voters in a referendum. The progress in Albany, combined with the opening of the lucrative Resorts World Casino, has whetted the appetite of an industry facing concerns about oversaturation across the country, but that is now jockeying for a piece of what could be a gambling bonanza. Cuomo has estimated casinos will spur more than $1 billion in economic activity in the state—but as with any public policy, there are supporters and opponents, potential winners and potential losers. Those on the short end won’t let it move ahead without a fight, from the populous metropolis of New York City to the once-alluring Catskills to western New York, where Native American tribes are doubling down on their existing casinos. In this special section of City & State, we explain the challenges and opportunities ahead as casino expansion heats up and the players consider how to play their hands. —Jon Lentz jlentz@cityandstateny.com

DAVID KATZ/ARNOLD KATZ PHOTOGRAPHY

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CITY&STATE


GOLD RUSH

With billions at stake among tough competitors, the only sure winners are lobbyists By JON LENTZ

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o a certain kind of operator, New York is filled with rich deposits of gold. From upstate mountains to western farmlands to city streets, the state is dappled with places ideal for extracting that gold from other people’s pockets and putting it in their own. These operators want to mine that gold. They want to build casinos aimed at tourists dazzled by the bright lights, at locals who have to leave the state to place a bet, at politicians giddy with the prospect of thousands of jobs and a flood of revenue. And the state wants to pave their way. But not everyone wins in a gold rush. If New Yorkers approve full-scale casino gambling in a public referendum, some of the companies that now run smaller, limited casinos will surely rake in millions of dollars—and others will see their profits tumble. The nine racetrack casinos currently doing business in New York will face off for the chance to upgrade their facilities with more slot machines and upscale table games like poker and blackjack— but at least two, and possibly more, will be left in the dust. Gambling behemoths like Wynn Resorts and Las Vegas Sands, which specialize in the “destination” casinos Gov. Andrew Cuomo is dreaming of, are also eyeing New York opportunities— as well as their Malaysian competitor, Genting, which beat them all by getting the first toehold in New York City. And for the state’s five Native American casinos, as well as some nearby casinos in places like Atlantic City and Connecticut, legalized gambling in New York could decimate their finances. They want to stop the spread of gambling if possible, or at least keep it far from their own casinos. Amid these shifting and competing agendas, the landscape is still being shaped. The governor and legislative leaders have not agreed how new casino licenses would be awarded, where they could go, who would be eligible and whether existing operators would get special treatment. The answers to those questions will determine who gets rich and who gets hurt in this gold rush. But one group is certain to win no matter what: lobbyists. “Lobbyists are going to do what’s good for them,” said Jeff Gural, who owns the racetrack casinos at Tioga Downs and Vernon Downs. “They’re going to convince casino companies, ‘Why don’t you hire me, and let me try to get you a license?’ If you’re asking me if this bill is good for lobbyists, I’d have to say yes.” It’s been the same equation in other states, from Ohio to Florida to Mary-

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land and Massachusetts: Whether or not casinos are ultimately legalized, lobbyists always get their cut.

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t’s no different in Albany, where lobbyists form a permanent shadow government that understands how to work a famously opaque system to either get things done or block them, especially when plenty of cash is at stake. The New York Gaming Association, a coalition of the state’s racetrack casinos, estimates more than $3 billion leaves the

had learned how New York works while employed in both the Assembly’s Democratic majority and the Senate’s Republican one—and has deep links into Gov. Andrew Cuomo’s office as well. His friend Jennifer Cunningham’s firm, SKDKnickerbocker, handles Genting’s public relations. The investment has paid off handsomely for Genting. In the five months since its Resorts World Casino New York City opened its doors next door to the Aqueduct racino in Queens, it exceeded its own expectations by raking in over $41 million in revenues in four months. “What Aqueduct’s done with its numbers, I think that spiked a lot of people’s interest,” said Chris Riegle, the

CASINO EMPIRE

to stop competitors from building theirs. David Strow, a spokesman for Boyd, said the company was monitoring developments in the state but added that it is too early to say whether it wants a casino in New York or if it would try to prevent any expansion. “We would need to see what New York is planning before we could comment on whether or not it would impact our property,” Strow said. Having brought in $2.34 billion in revenue last year, Boyd Gaming will hardly notice its lobbying bill. The dynamics are the same for everyone else in the game: With so much potential for riches, snapping up lobbyists is a minor cost, even if just to prevent competitors

Racetrack Casinos St. Regis Mohawk Tribe Oneida Indian Nation Seneca Nation of Indians Seneca exclusivity zone

While Gov. Andrew Cuomo, legislative leaders and an array of business interests push to legalize casino gambling in New York, 14 Indian casinos and racetrack racinos are already operating.

state each year as gamblers shuttle off to Atlantic City, catch a bus to Connecticut’s Foxwoods or Mohegan Sun or hop on a flight to Las Vegas—and one thing that stays in Vegas is the cash spent by visiting New Yorkers. The big Las Vegas-based casino companies interested in capturing some of that revenue in New York—or blocking others from taking it—need only look at the example of Genting. The company secured long-term rights for a casino at Aqueduct Racetrack in Queens after hiring a contingent of wellconnected lobbyists, strategists and public relations professionals. The company spent over $1 million over the past two years, bringing on top lobbyist Patricia Lynch, a former aide to Assembly Speaker Sheldon Silver, as well as lobbyists John Cordo and Brian Meara, both veterans of past casino battles. Genting built a team that collectively

president and general manager of the Finger Lakes Casino and Raceway. “Their numbers have been stronger than a lot of people predicted. I think that’s where the interest is being driven from.”

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hat has spurred international casino operators like Wynn Resorts and Las Vegas Sands to look into how they could replicate Genting’s success. For firms used to spending colossal sums of money building gilded palaces where they can reap even more, there’s little to lose and plenty to gain by trying to lock up lobbyists in a state like New York—no matter what their goal. Take Boyd Gaming, a Las Vegas-based company that is part owner and operator of the popular Borgata casino in Atlantic City. Boyd recently hired the New York firm Malkin & Ross for $10,000 a month, leading to questions about whether its true goal is to build a casino in New York or

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from hiring them. In fact, if companies like MGM and Wynn, which have yet to register any in-state lobbyists, make a bid for a casino in New York, they will find many top lobbyists are already working for their opponents. Wilson Elser Moskowitz Edelman & Dicker, the state’s top lobbying firm by earnings in 2011, has several off-track betting corporations as clients as well as SL Green Realty Corp., one of the failed bidders on the Aqueduct casino. Patricia Lynch Associates, the No. 2 firm, works with Genting. Other top 10 firms representing clients on gambling issues include Bolton–St. Johns, representing the St. Regis Mohawks; Hinman Straub Advisors, representing the Senecas; and Malkin & Ross, for Boyd. The racetrack casinos have their lobbyists too, with some hiring on two or three for good measure. APRIL 2, 2012

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“On this issue it’s tough, because a lot of them have Indian gaming clients, so I’m not sure who the outside groups may hire,” said a political operative who has closely followed the casino issue. “A lot of the big firms already do have clients either at the racinos or the gaming association or the tribes.”

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he big money hasn’t even started flowing yet. Genting, the highestspending gambling-oriented entity, didn’t crack the top 10 for lobbying expenditures in 2011. Spending on other issues like the state budget and samesex marriage dwarfed the dollars going to gambling-related causes last year. How frenzied the lobbying gold rush becomes this year depends largely on how the governor and the Legislature move forward. One critical element is where the state sets its tax rate on commercial casino revenues. The racetrack casinos, which only operate electronic slot machines, pay 60 percent or more to the state for education funding and other purposes. Those rates are among the highest of any state. “At that point, the state is practically the owner,” said David Schwartz, director of the Center for Gaming Research at the University of Nevada, Las Vegas. “They’re the majority in the enterprise, or at least they’re getting the majority of the profits.” By comparison, Nevada has an effective tax rate of around 7 percent, New Jersey is close to 8 percent and the two Connecticut Indian casinos pay about 25 percent of the slot revenue to the state, Schwartz said. So if Cuomo wants to attract developers who will build lavish casino resorts, complete with restaurants, hotels, spas and other amenities comparable to those at Las Vegas’ top properties, operators may demand a bigger cut for themselves. “I don’t think anybody is going to build a Bellagio on a 40 percent, 50 percent tax rate,” Schwartz said. “You would have fewer amenities. You would have something that looked a lot more like a racino than it would look like the Bellagio.” Cuomo’s dream of bringing the highrolling glitz and glamour of Vegas to New York isn’t so far-fetched, observers say, but it will require a careful tweaking of the tax rates and perhaps a tailored approach to attract the big names to the New York City region and the Catskills, while also making room for a more modest expansion in less populated areas. Riegle, the president at the Finger Lakes Casino, said high tax rates resulted in little competition at most of the state’s racetracks when slot machines were added, starting in 2001. “I think the critical factor is people who are interested in coming into the state are probably all looking to the New York City market,” he said. “Outside the New York City market you’ve got to be a savvy operator to exist with a 21 percent margin. It’s a good market, yes. But it’s more of a niche market outside of New York City.”

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hat key question of where to locate the casinos has yet to be decided in Albany. The most alluring market is New York City, with more than 8 million

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residents and hordes of tourists. Lawmakers pledge to keep Manhattan off the table, and though that commitment is not set in stone, others are plotting to see how close to the city they could build their own operations. The Shinnecock Nation, which is represented by Mercury and two other lobbying firms, has talked about opening a casino in Long Island. Out-of-state companies could also make the case that the New York City region is flush enough to accommodate another casino or two without siphoning gamblers from Genting and the Empire City Casino at Yonkers Raceway, easily the state’s two biggest racinos. Genting wants to build a supersize convention center next to its Queens casino—something that has captured Cuomo’s imagination—and is likely to demand protection from nearby competition in exchange. But with the governor and lawmakers not saying how they would pick winners of the seven commercial casino licenses— or even what the rules are—lobbyists are eager to offer a guiding hand through the uncertainty. Another potential gold mine for lobbyists is the Catskills, the once-popular resort region that has fallen on hard times. Sen. John Bonacic, chairman of the Racing, Gaming and Wagering Committee, has pledged to locate a commercial casino there to jump-start the stalled economy, and several local players have already spent years squabbling over the rights to build. In western New York, the Senecas have launched a public relations and advertising campaign to defend their three casinos, which are mired in a legal battle over the three racetrack casinos operating in their exclusivity zone. The Oneidas, which operate the Turning Stone resort Casino, have hired highcaliber operative Chris Lehane to bolster the work of their lobbying firm, the Roffe Group. Some observers expect the Senecas and the Oneidas to launch an all-out assault to block a constitutional amendment. If they do, they could be joined by players like Caesars Entertainment, which has four casinos in Atlantic City, or the Native American owners of the struggling Foxwoods and Mohegan Sun casinos in Connecticut, to avoid losing more of their clientele. “This is a big issue,” said a source close to Genting. “I don’t know if it’s going to be the biggest issue of all time, and I think there’s no way to tell that. But it can get heavy quickly.” For now, the uncertainty is driving everyone with a stake in the issue into the arms of a lobbyist. And when the governor and the Legislature agree on how to proceed, the gold rush will only get richer. “There’s always going to be people who are for and against it,” said Schwartz, the director of the Center for Gaming Research. “And obviously, like any other business, there’s money to be made here.” jlentz@cityandstateny.com

A HISTORY OF BAD BETS

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ov. Andrew Cuomo and the Legislature may be banking on legalized casinos to help buoy the state’s economy, but history suggests the industry attracts corruption and scandal just as much as jobs and development. “NYPIRG does not have a position on casino gambling, but we feel that the history of corruption on this issue in New York and other states indicates that if this amendment passes, a strong oversight body should be empowered,” said Bill Mahoney of the New York Public Interest Research Group, who helped compile this time line. From Charles Evans Hughes’ failed attempt to outlaw horse racing to Donald Trump’s mea culpa, New York gambling—legal and illegal—has long driven a cat-and-mouse game between those who would make money from it and those who would regulate it. 1894–The Lexow Committee uncovered hundreds of examples of Tammany policeman collecting payments from underground businesses, including gambling houses. 1908–An attempt by Gov. Charles Evans Hughes to eliminate illegal betting on horse racing was repelled by opponents who gave hundreds of thousands of dollars in bribes to lawmakers out of an Albany hotel room. 1935–New York City Mayor Fiorello LaGuardia cracked down on corner-store slot machines, a major source of Mafia funding. LaGuardia did it with gusto, rounding up the so-called “one-armed bandits,” swinging a sledgehammer and dumping the busted machines into the river. 1953–After a union leader was found murdered at the raceway in Yonkers, an investigation revealed that stock holdings in New York racetracks were dominated by state legislators and party officials. 2000–Donald Trump issued a public apology after he failed to disclose money spent running advertisements against expanding casino gambling in New York. He and lobbyist Roger Stone were ordered to pay $250,000 in fines. 2005–A lobbying firm run by former Attorney General Dennis Vacco paid a $50,000 fine to settle an investigation into accusations that a casino developer had offered him an illegal “success fee.” 2010–The state inspector general issued a devastating report claiming Senate Democratic leaders John Sampson and Malcolm Smith helped Aqueduct Entertainment Group’s efforts to open a racino in Queens in exchange for campaign contributions. A federal investigation is reportedly still open.

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—Andrew J. Hawkins ahawkins@cityandstateny.com

CITY&STATE


LUCKY NUMBER SEVEN? Fiscally Reliable & Socially Responsible

Lawmakers cap the number of casinos, but racinos call for more

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hen lawmakers last month took the first step toward legalizing commercial gambling in New York, they decreed no more than seven commercial casinos would be allowed in the state. Why seven? They didn’t say. The number instantly became the subject of furious speculation in a debate with billions of dollars at stake. Some observers speculated New York had secretly been divided into seven regions, with one casino to be allowed in each. Others suspected it was a ploy to pit the operators of nine racetrack casinos against each other when preparing their bids, boosting state coffers but leaving two in the cold. And some guessed it was picked to represent the ultimate lucky number. In fact, people involved in the talks say the cap was arrived at as a compromise between Senate Republicans, who wanted as many as 10 casinos, and Assembly Democrats, who wanted significantly fewer. And as it turns out, seven may not be the final number after all. “Although seven is a ‘lucky number,’ the final number was reached through negotiation with the governor,” Sen. John Bonacic, who chairs the Racing, Gaming and Wagering Committee, explained in an email. “The Senate had no hard and fast number. We were satisfied with anything greater than six.” Bonacic said the governor’s office had hoped to save the specifics for next year and get first passage of the constitutional amendment out of the way. But those who wanted more specifics were successful in including the cap in the resolution, which means the sevencasino limit could become enshrined in the state constitution if the number isn’t adjusted by the end of the year. The resolution has to be passed twice, by two separately elected Legislatures, before going to voters in a referendum.

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“I think it was just an effort to put some specificity in,” said Scott Reif, spokesman for the Senate Republicans. “Some of the parties just wanted it to be silent on that. Some wanted some specificity on how many.” Assembly Speaker Sheldon Silver, who has been seen as a reluctant backer of casino expansion in the state, has insisted that Manhattan be off-limits if gambling is legalized. At hearings on the issue last fall, lawmakers also said they want to prevent clusters of casinos like in Atlantic City, which has struggled with declining revenues in recent years. Yet the cap has disappointed owners of the state’s racetrack casinos, or racinos, which have joined forces under the banner of the New York Gaming Association. They believe all nine should be allowed to become full-fledged casinos and reap the promised benefits. “We’re a long way from this process being over,” said James Featherstonhaugh, the president of the association. “I honestly don’t know if there are going to be practical possibilities to add sites to it or not. We’re certainly going to inquire about that and explore that.” Chris Riegle, president and general manager of Finger Lakes Casino and Racetrack, said he didn’t view the cap as being set in stone, and that he expected discussions to continue. “I think it was something to get through the budget, and then have conversations later,” Riegle said. “That was how the governor portrayed it, and that’s how we’re taking it.” Bonacic acknowledged it is legally possible to increase the number of casinos, though the chances are slim. “We are satisfied with seven casinos,” he wrote. “We would rather see tourism destinations as opposed to mini-casinos.” —Jon Lentz jlentz@cityandstateny.com

A WINNING COMBINATION

For generations our members have served their communities funding education, creating jobs and supporting local government.

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APRIL 2, 2012

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ANDREW SCHWARTZ

BETTING’S PAST LIVES ALONGSIDE ITS FUTURE Outside the racino’s glow, horses still race at Aqueduct By MICHAEL MANDELKERN

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queduct Racetrack in Queens feels like an airport that has seen better days: Old TV monitors hang from the ceiling, announcements echo off concrete corridors and grizzled race fans stand around waiting. On a gloomy, brisk Friday afternoon last month, several hundred people made their way into the cavernous grandstand to wager on horses. Most kept their eyes glued to the screens, watching the fluctuating odds for the first race at Aqueduct and the progress of races at other tracks across the country. Some stepped into the cold outside to smoke cigarettes and watch the jockeys and trainers parade their horses to the starting gate. “Well,” one bettor said, “let’s start the day on a good note.” The dingy conditions at Aqueduct are a world away from its neighbor next door, Genting’s Resorts World Casino, a bright swirl of vibrant colors where flashing lights twinkle and tones jingle from endless rows of what look like slot machines but are technically called “video lottery terminals.” Yet their fates are linked: Since the racino opened in October, 6.5 percent of the take from those VLTs has gone to the New York Racing Association, which runs Aqueduct and two other state tracks. The money has increased the prize purses in each race, which has drawn more horses to compete and boosted the state’s thoroughbred industry. NYRA’s three tracks handled $352 million in bets last year, up 32 percent from 2010, compared with a 2.6 percent increase at every other horse track in New York. Now both racinos and racetracks

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face a reckoning in the coming years, as Gov. Andrew Cuomo wants to legalize full-fledged casino gambling in the state. Genting wants to build a massive convention center at Aqueduct, and everyone expects the company will try to place a casino there as well. That raises questions about the fate of the old racetrack—especially with NYRA’s Belmont Park racetrack just seven miles away across the Nassau County line. “Everyone is trying to figure out what the future holds,” said Jeff Cannizzo, executive director of New York Thoroughbred Breeders, Inc. “Ideally, they [casinos and racetracks] can coexist with each other, as they do around the country.” Cannizzo said casinos would employ only a few thousand people in New York, while industry advocacy groups estimate horse breeding and racing are responsible for 40,000 jobs. The groups have banded together to form the New York Horse Racing and Agriculture Industry Alliance to protect their interests should casinos come to the state. Aqueduct hosts races during the winter months, and typically has offered middling competition as the best horses, jockeys and trainers head to Florida or California. The quality improves when NYRA shifts operations to Belmont in the spring and fall, and its summer meet in Saratoga still draws some of the best competition in the sport. Genting’s expansion plans at the site, which include what would be the largest convention center in the country, would keep Aqueduct Racetrack open. Any decision to close it down and winterize racing at Belmont would be decided by NYRA and the state, said Stefan Friedman, a spokesman for Genting’s Resorts World Casino. The current plans make room for

both a convention center and racetrack. “It’s not for us to say if racing is going to stay there or not,” said Friedman. “And so I think to assume that they’re going to winterize Belmont and go there is presumptuous. We envision racing in our plan.” Aqueduct certainly has its fans, who would be disappointed if the racetrack were no longer in operation. “There’s so much racing history here. [Belmont] isn’t very conducive to winters,” said Maggie Wolfendale, an on-air analyst for NYRA’s TV broadcast. “Some people just love Aqueduct.” Assemblyman Gary Pretlow, chair of the Racing and Wagering Committee, agreed that Aqueduct serves an important function in New York horse racing, and needs to stay in operation even if a convention center is built next door. “It’s like a stepladder,” Pretlow said. “If you cancel Aqueduct, it will make Belmont less important.” Jack Friedman, executive director of the Queens Chamber of Commerce, would like to see Aqueduct keep running, but if not would want Genting to compensate the track for its lost jobs. “I don’t know if it makes sense to combine both,” he said. “Belmont should have a first-class quality racetrack if there’s such a development.” NYRA is banking on Aqueduct’s success, arguing that the track was profitable this year based on NYRA’s net income of $19 million this year—of which all but $1.4 million came from VLTs. The average daily purse this season is $375,000, up $100,000 from the year before, and the daily betting average in February was up 19.6 percent from the previous year. “I think there’ll always be a passionate group of people coming to Aqueduct,”

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said NYRA spokesman Dan Silver. “There’s not a lot of crossover between people that play slot machines and people who bet on horse racing.” But more revenue from VLTs and more extravagant purses may have hurt the horse-racing industry in a fundamental way: At least 18 horses have died while running on the track at Aqueduct since the season started late last fall, up from 10 in each of the previous two years. Cuomo has called for an independent investigation, and NYRA responded by cutting the newly rich purses in lower-quality races, giving owners less incentive to work a horse beyond its capacity. NYRA has also struggled at times to handle the basic tasks of posting results and calculating payouts, which have not seemed to be improved by additional funding. State Comptroller Thomas DiNapoli says NYRA faces a $19.7 million deficit, and fears it will misappropriate the $48 million in VLT profit it is projected to receive this year unless safeguards are put in place. In a statement, NYRA said it disagreed with DiNapoli’s findings. “To implement all of the recommendations…would have required more money and resources than NYRA could prudently spend at that time,” the statement reads. “We fully understand the importance of this process and remain committed to completing it.” On that cold Friday at Aqueduct, the bettors wagered $823,117 over the course of nine races. The real money came in from the televised simulcast, as the track handled another $5,538,387 from around the country. In the day’s first race at 12:50 p.m., seven horses shot out of the gate to a chorus of shouts and applause from the bettors. “C’mon baby, go get ’em!” one man yelled. Running for a $30,000 purse, they covered a mile of dirt track in less than 90 seconds. The winner, Pleasantfriday, returned $4.70 on a $2 bet. The thrill was intense yet short-lived. Losing bettors sulked away as discarded white betting slips began to litter the floor. The next race was half an hour away. editor@cityandstateny.com

CITY&STATE


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www.cityandstateny.com

April 2, 2012

17


the players

the numbers

GENTING

$1.4 $1.2 $2

TOTAL HANDLE ON NEW YORK STATE RACING

$8 $6 $4 $2

10 20

0

20

20

0

7

8

9

$0

2010 NATIONWIDE THOROUGHBRED PURSES

The Genting Group, a Malaysia-based conglomerate that develops casinos worldwide, opened the Resorts World New York Casino in Queens last fall, the first racetrack-based “racino” to operate in New York City. The company has offered to fund the construction of what would be the nation’s largest convention center next door. In turn, it hopes the state will lower its tax rate on any table games or any additional slot machines. Genting has contracted with SKDKnickerbocker to run its public relations and Tusk Strategies, Inc. for strategy, as well as lobbying groups Patricia Lynch Associates Inc., Cordo & Co. LLC and Meara Avella Dickinson.

NEW YORK STATE RACING AND WAGERING BOARD Chairman John Sabini and the two other members of the board oversee horse-racing operations in New York, which are heavily subsidized by existing racinos, as well as Indian gambling. The board will be merged with the Division of the Lottery into the newly created New York State Gaming Commission, with five members appointed by the governor and one by each of the Senate and Assembly leaders.

LABOR Peter Ward, president of the New York Hotel Trades Council, and his legislative director, Josh Gold, are working closely with the Cuomo administration and the Legislature on gaming and its impact on the workforce. Their mission is to ensure that any gaming company seeking one of the state’s seven available licenses will agree to a living wage and health benefits for its future casino employees. Gary LaBarbera, president of the powerful Building and Construction Trades Council alliance of construction unions, has allied with Cuomo’s economic agenda and is keen to get in on the action of building the new casinos.

The Legislature voted March 15 to approve the constitutional amendment to allow casino gambling.

TOTAL HANDLE ON OUT-OF-STATE RACING

6

Amending the constitution to allow casino gambling begins with the state’s 212 senators and Assembly members. The Legislature voted last month to amend the state’s constitution, the first of two required votes. LouAnn Ciccone, secretary of program and policy to Assembly Speaker Sheldon Silver, is overseeing the issue for the Assembly Democratic majority. Likewise Robert Mujica, secretary to the Senate Finance Committee, is running point for Senate Majority Leader Dean Skelos and the Senate Republican majority. However, observers speculate both Ciccone and Mujica could be replaced at the negotiating table by their bosses as gaming heats up.

$1.6

0

THE LEGISLATURE

TOTAL PARI-MUTUEL HANDLE: NEW YORK STATE VS. OUT-OF-STATE TRACKS

in millions

Gov. Andrew Cuomo is on a mission to legalize fullfledged Las Vegas-style casinos in New York State. Cuomo appointed Bennett Liebman, a former commissioner of the New York State Racing and Wagering Board, as his adviser to oversee gambling through a broad spectrum. Sources describe him as the point man on the Second Floor, or the “gambling czar.”

20

THE STATE

State

Gross Purses

Races

Horses

California New York Pennsylvania Kentucky Florida Louisiana West Virginia New Jersey Illinois New Mexico Maryland Indiana Delaware Oklahoma

$132,541,382 $119,800,835 $116,275,253 $89,311,408 $76,909,950 $76,089,389 $63,613,425 $50,024,825 $46,285,006 $30,737,667 $27,342,500 $27,208,855 $26,714,799 $22,832,885

4,403 3,740 4,519 2,020 3,233 3,251 4,065 877 2,104 1,718 1,365 1,128 1,041 1,116

6,651 6,355 9,414 6,794 7,493 7,581 8,251 3,008 3,884 3,056 3,650 3,249 2,849 3,020

Gross Purses

Aqueduct Belmont Saratoga Finger Lakes Batavia Buffalo Monticello Saratoga Harness Tioga Vernon Yonkers Tot al

$65,770,119 $85,164,690 $114,693,166 $8,875,325 $2,258,300 $2,672,358 $4,438,717 $6,270,117 $1,795,579 $3,644,111 $16,353,136 $311,935,618

The issues CASINO OPERATORS VS. EACH OTHER The legalization of table gaming does not necessarily mean blackjack and Texas Hold’em will run rampant. The Legislature authorized seven casinos in the state last month, creating a sense of competition among potential operators including Genting, Wynn Resorts, Las Vegas Sands and Boyd Gaming. It’s unclear whether the seven full-fledged casinos will be limited to the nine preexisting racinos or if there could be as many as 16 total casinos throughout the state. While the racinos lobby to allow table games at the racetracks, Genting wants assurances that another casino will not open even closer to Manhattan. • Genting spent $975,000 on lobbying in 2011, as well as close to $100,000 in campaign contributions to elected officials, party committees and a PAC.

HORSE RACING VS. CASINOS The distribution of revenue from video lottery terminals, the technical term for the state’s existing slot machines, is settled, but the same is not true for table games. VLT revenue significantly bolsters racetracks, and adding more funding through table games could be even more helpful to the racing industry. • Allocation of VLT funding: 47 percent for education, 23 percent for racetrack operations and 10 percent each for agriculture businesses, the New York Lottery and capital investments. • Of the $3.7 billion that gambling and racing bring in for the state, $3 billion goes to education, $634 million for agriculture business and $146 million for local governments.

The Seneca, Oneida and St. Regis Mohawk tribes negotiated casino rights in western and upstate New York. They fear a loss of business from any new competition and will oppose new non-Indian casinos in their zone. On Long Island, the Shinnecock tribe could potentially try to open an Indian casino, further complicating Genting’s plans in Queens or those of any other company that wants to build on Long Island.

SOURCE: NEW YORK STATE RACING AND WAGERING BOARD

• The Seneca Nation of Indians made the largest campaign contributions of all gambling-oriented entities in the second half of 2011, with $142,500.

HOW GAMBLING GETS LEGALIZED

BUT

To become law, the amendment must pass a separate Legislature, that takes office in 2013.

then

Voters must approve it in a referendum, but when?

10

Don’t come bar

INDIAN CASINOS VS. CASINO DEVELOPERS

2010 TOTAL BETTING ON NEW YORK STATE RACETRACKS State

8

NINE

4 5

six

5 4

0

8

20

10

six

Don’t come bar

NINE

S CO R E C A R D : R AC I N G , G A M I N G A N D WAG E R I N G

2013

High turnout in New York City in a mayoral election year, but a low-turnout year for the rest of the state.

or

2014

Cuomo is up for reelection, drawing more upstate votes.

don’t pass bar

PASS LINE 18

APRIL 2, 2012

www.cityandstateny.com

CITY&STATE


E x p E r t r o u n dta b l E : R ac i n g , g a m i n g a n d Wag e R i n g Gary Pretlow

Chairman, Assembly Racing and Wagering Committee

Q: If it’s not feasible for Genting to shut down the Aqueduct racetrack to make room for a full-fledged casino, where could Genting expand its operations? GP: There’s space in the current facility. They have a whole third floor. Plus they have the rights to their facility now, and I’m pretty sure they can build something on another level, if that was the case. I really don’t want to see the racetrack go away. I haven’t had a discussion with the governor, but I don’t think [a sevencasino limit in New York] will be a slam dunk. It means two [of nine state racetracks] aren’t going to make it. Those discussions will take place at the latter part of this year. Some of the racinos

Steven Cymbrowitz

Chairman, Assembly Alcoholism and Drug Abuse Committee

Q: How successful are treatment programs in helping addicts overcome a gambling addiction? SC: They’re successful as long as there are programs. Last year the governor eliminated $2.4 million from all 41 agencies that deal with compulsive gambling. Based on the fact that we’re now going to allow up to seven casinos, the revenues are substantial. We’re talking about $2 billion in revenue a year. We need to take a percentage of it and use it for prevention and treatment programs. It’s a number that has to be determined, and we’ll work with all parties on that. We have a million New Yorkers right now that have some form of gambling addiction. And by increasing the number of casinos, we’re obviously going to have to deal with a larger number. Not only that, but there should be prevention programs. It’s amazing the number of school-age kids that are involved in gambling. We can stop and deal with youngsters before the problem becomes worse. That’s why prevention is very important. I think we have to deal with the issue. Don’t get me wrong: I support the referendum; I voted in favor of it; I think it’s a terrific economic engine; it’ll create anywhere between 5,000 and 6,000 jobs. But at the same time we should deal with the consequences. Q: Are you concerned that gambling could also exacerbate alcohol and substance abuse issues for some people? SC: It could. Let’s think about that for a minute and say, “Okay, I’m addicted to the drugs and I’m addicted to the gambling, where am I going to spend my money?” I think we’re dealing with treatment for someone with an addictive personality. Gambling is

CITY&STATE

may become casinos but, theoretically, there could be seven more on top of the nine racinos. For there to be 16—I doubt that will be a possibility. The process will be lively and vibrant. I don’t think this governor will mess it up. Q: Since Genting opened its Resorts World Casino in November, do you believe it has been in competition with the Empire City Casino in Yonkers? GP: I have not heard if there has been any decrease in revenue. You would have to ask them if they lost any revenue. They have not complained that they have been hurt in any way. If I had a monopoly and someone was gong to

an addiction unto itself. Q: Do you believe table games are more addicting than VLTs and slot machines? SC: I don’t think one is more addictive than the other; I’m just dealing with the concept of gambling. Look, you walk through Aqueduct and see a certain population sitting at the slot machines, and you see another one at the tables. Is one more addictive than the other? I don’t know.

open a business 14 miles away from me, it would be a concern. New York exports $4.5 billion in gaming dollars. We’re trying to retain the bulk of that in the state of New York. Q: What is the likelihood New York will permit a casino in the heart of Manhattan? GP: Less than slim to none, at least in this decade. The governor and speaker are opposed to it. I had always thought a perfect place for a casino would be Governors Island. It’s in the city but not in the city. It would be a highstakes, cards-only type of casino. I’m looking for a deal that is best for the state. I’m not looking for what’s best for any individual, so I wouldn’t try to change their minds. My opposition doesn’t matter here. I don’t think Times Square is that bad of an idea.

at the number of people that were there that lost their homes because they bet it all away. They were unemployed. Their families [had] broken up. Q: Will making sure the bill allocates a sufficient amount of money to treatment and prevention programs be difficult when finalizing legislation next year? SC: I think most people agree that we

I wouldn’t submit a bill to do it—the opposition is that strong. That would probably be the most lucrative casino in the world. It would be like billions, but it’s not going to happen. You’re going to have all types of people you wouldn’t want in a casino there. That’s not a place you would want to put it. Q: What is your top legislative priority in the Racing and Wagering Committee this year? GP: The second passage of this constitutional amendment and an organization bill: where they’re going to be, what the tax rate is going to be, who is going to do it. Does all of the money go to education or to the gambling fund? I doubt there will be any changes to there being seven full casinos. Any change to it would delay passage by two years, from 2013 to 2015.

need to do this. We need to figure out how to do it. I know it’s something that Pretlow agrees with, I know the governor has someone on staff that specifically would deal with it, and he believes in it as well. This type of new legislation is always a challenge, but I think that all of us working together will be able to deal with the issue. —Michael Mandelkern editor@cityandstateny.com

Q: How do you think a casino in your district would impact your community? SC: There would certainly be more people addicted to gambling, which brings a possible increase in crime and prostitution. On the other side, it’ll bring economic opportunity. So you have to weigh it. If someone told me they would bring a casino to my district, but they say there would be no prevention or treatment dollars, I would say, “No, I don’t want it.” But if you say you are going to provide services for my community and people that come to that destination, I would certainly consider it in a more positive way. Money for treatment has to be allocated as well in the enabling legislation. Q: What are some of the negative consequences of gambling? SC: There are studies that show that gambling addiction increases the closer you get to casinos. There’s been a 10 percent increase in gambling addiction within a 50-mile radius of casinos, and bankruptcies have increased. Gambling addiction is almost a silent type of addiction because you don’t see it, but it certainly affects families, where they can go bankrupt. I went to a Gamblers Anonymous meeting, and I was shocked www.cityandstateny.com

april 2, 2012

19


BETTING AGAINST THE HOUSE

ANDREW SCHWARTZ

Not everyone’s excited about casinos coming to New York By LAURA NAHMIAS

N

ot everyone loves the idea of casino gambling in New York. Just ask any one of the 45 Assembly members who voted “No” last month on a constitutional amendment legalizing casino gambling. The reasons vary widely. Assembly Speaker Sheldon Silver does not like gambling, and was willing to support the casino gambling amendment as long as none of the seven possible casinos would be sited in Manhattan. Some, like Orthodox Jewish Assemblyman Dov Hikind, voted “No” for religious reasons. Assemblyman Félix Ortiz voted “No” out of concern for constituents susceptible to compulsive gambling, a problem among Asian constituents in his district, he said. Ortiz has long been an advocate of increased support for gambling addicts, in part because of his personal connection to the disease. “I have a very special friend who is an attorney, who got compulsively addicted to casino gambling,” he said. “She lost all her friends, she lost her house, she lost everything, and she had to go to Michigan for treatment as a result of the gambling.” Ortiz said he would support a bill to legalize gambling if it provided dedicated funds for the construction of an inpatient treatment facility for compulsive gamblers, or required casino opera-

20

APRIL 2, 2012

tors to provide helplines for addicted gamblers. Ortiz’s concern echoes a larger one that Congress started to address a decade ago, as gambling establishments exploded across the United States. By 1999 47 different states had legalized some form of gambling, compared with just a handful in 1976. Congress In 1999 authorized a National Gambling Impact Study which determined that compulsive gambling was

failing them in the state of New York, and I think we’re failing them as our constituents.” That view is also held by some economists, who say casino gambling might have positive effects for the state’s economy on the whole, but can hurt poorer residents. “Is this the best policy for generating revenue? I’m not sure about that,” said Lucy Dadayan, a policy analyst at the Rockefeller Institute of Government who studies state gambling revenues.

“Right now, with the legislation they’re putting forth, it’s a roll of the dice, and it could come up ‘snake eyes’ for the constituents of New York State.” a serious problem for residents in communities where gambling was legalized. The study recommended studying the rates of compulsive gambling in those areas. Gambling can have a “very bad domino effect,” Ortiz explained, brushing aside any claims that people should be responsible for their own gambling behavior. “It’s like sugar,” he said. “If you give sugar to these people and attract them into it, and they continue to love it and we don’t have any safety net for them, and as a result they might become addicted, I think we’re

“It’s one of the most regressive taxes,” she said. “It puts a lot of burden on the economically disadvantaged population because the literature shows that a lot of people who do engage in gambling activity are mostly people who are relatively poor.” Others, like Republican Assemblyman Jim Tedisco, voted “No” on casino gambling, not on principle but on matters of process. “I’m not against table gaming and casino gaming,” he said. “I understand the logic that people are taking planes and trains and buses to other states when they could keep that money here,

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but the lack of transparency is unbelievable in this thing.” The casino legislation gave no hint that local governments would receive remuneration for the additional police and safety personnel that might be needed to protect communities where new casinos are placed. And the seven-member gambling commission proposed by Gov. Andrew Cuomo would be stacked heavily with his appointees, leaving communities that might host casinos little power to refuse them. The state already has nine racinos and several Indian casinos, but Tedisco worried the state will bring in new operators from other states to run the casinos, competing with the current gambling facilities in place. “There’s a lot of money that’s involved. Each one of these casino facilities is billions of dollars,” Tedisco said. “What is the impact on the most historic racetrack in the world? If they put one in Lake George just down the road from Saratoga in my district, they’re not going to want to come to the races in the summer.” All of the uncertainty was too much for Tedisco and other Assembly Republicans, he said. Too many things were left unclear in the bill as written. “Right now,” he said, “with the legislation they’re putting forth, it’s a roll of the dice, and it could come up ‘snake eyes’ for the constituents of New York State.” lnahmias@cityandstateny.com

CITY&STATE


IT’S ALL IN

S

tay plugged into New York politics all day long with The Notebook, the new political blog from City & State. Led by political writer Chris Bragg with contributions from the entire City & State staff, The Notebook is City & State’s new online home for breaking news and sharp analysis of the shifting sands of campaigns and elections in New York.

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JANUARY 23, 2012

21

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APRIL 2, 2012

21


PERSPECTIVES

PLAYING CHECKERS ON A CHESSBOARD Skelos scores big, while Silver is barely on the board

a begrudging Silver last year not only passed a budget that slashed spending and reined in Medicaid costs but also got the property tax cap done. By fall, though, the governor s Albany transitions from found himself in a pickle for his passing a budget to tackling next budget, as the 2009 income tax the rest of this year’s session, surcharge was due to expire. Cuomo wanted to keep everyone except the unions his campaign promise of is giving Gov. Andrew Cuomo no new taxes. Silver wanted high marks. But the victories a revived millionaires’ tax. racked up by the two Skelos was in a tight spot: legislative leaders over the Occupy Wall Street was in last 15 months tell a much full swing, the public overdifferent story. whelmingly supported After Cuomo’s big win in the millionaires’ tax, and 2010, conventional wisdom Susan Del Percio Republicans were afraid of held that the Republican Senate majority was over a barrel: The looking like they only cared about the governor could threaten to veto their 1 percent. In a game of checkers Cuomo would redistricting lines any time he wanted. But that wisdom missed a new truth: have turned to Silver to cut a deal and The newly elected governor’s fiscally force it on Skelos. But this time the conservative agenda was much more in game was chess. Skelos skillfully built sync with Republicans than Democrats. up goodwill with the governor, and Senate Majority Leader Dean Skelos when the new tax plan was suddenly immediately realized that to survive sprung on New York, it included one of redistricting he would have to play a long the largest middle-class tax cuts ever game of chess with the governor. Yet on passed. Silver was in the negotiations the other side of the Capitol, Assembly too, but had to accept table scraps—a Speaker Sheldon Silver was getting ready tax increase on those making $2 million or more, a floor twice as high as his to play more checkers—not chess. Remarkably, Cuomo, Skelos and beloved millionaires’ tax.

A

Silver still didn’t learn when pension reform came to the fore this year. Republicans had long championed it, and a Democratic speaker beholden to unions was, of course, firmly against it. In any other year the speaker would have used it as a chit for something else that he wanted. But this was no ordinary year: It was a redistricting year, one with an accelerated schedule for Congressional races that required their lines to be drawn by March 20. Most of the political world focused on whether Cuomo would veto Senate lines drawn to preserve Skelos’ majority. Quietly, though, Silver faced troubles in his own conference—first with individual seats, then with a larger power struggle over Congressional lines that entangled several of his key Assembly members. Once again Silver’s checkerboard turned out to be the place where Skelos and Cuomo were moving pawns and queens. The speaker compromised on the “Big Ugly”—casino gambling, a DNA databank, redistricting and pension reform—and had to stay up all night twisting arms in a reluctant Assembly to pass the pension bill at sunrise. Nobody got everything they wanted this year, and there are still months of work ahead. But it’s easy to see the

differences in how the two legislative leaders performed. Silver had to accept pension reform, and though he watered it down, public employee unions are so furious they may withhold the political donations that usually help them keep Democrats in line. Silver’s own conference is infuriated with him over redistricting, and New York’s congressional delegation feels the same way. Skelos, however, scored big. Pension reform, a property tax cap and a real cut in state spending are powerful, voterfriendly Republican achievements—and keeping the Senate majority for another decade has earned him the loyalty and respect of his members. Silver has one fight left this year, raising the minimum wage. The question now is whether he will try to make amends with his conference by selling out that goal for legislative pay raises. The way Silver plays the game, I wouldn’t doubt it. Susan Del Percio is a New York-based Republican strategist and founder of Susan Del Percio Strategies, a full-service strategic communications firm. Read more of her columns at www.cityandstateny.com

A DIFFERENT KIND OF REDISTRICTING WAR What’s wrong with compromise?

Legislature is corrupt and dysfunctional ised a veto. Modifications were made, mise in Washington are equally outraged and carried publicly by the unlikely duo but the lines were still clearly drawn to when compromise and horse trading protect the (R)s. Cuomo signed the bill produce just that: a compromise. of Cuomo and former Mayor Ed Koch. to a chorus of boos from his reform and Koch used his considerable clout to A lot of what passes for reform is ast month saw the end of Albany’s get legislative signatures on a pledge to editorial allies. really a kind of alienation from the way decennial redistricting wars. For all the high-minded rhetoric, politics works in a democracy. Last The Legislature and Gov. Andrew enact an “independent commission” to Cuomo agreed on Assembly and Senate draw lines, and Cuomo made A lot of what passes for reform is really a kind of it a centerpiece of lines, and punted the Congreshis campaign. But alienation from the way politics works in a democracy. sional lines to the federal the ferocity of the attack Cuomo traded redistricting for legislative month, politicians protected their selfcourts. The Assembly lines on the current system had agreement to a series of pension reforms interest along the way, and delivered were by and large unexcepone truly negative conse- that were politically difficult for incum- other results—results the voters care far tional, the Senate lines were quence. There was never an bents but widely supported as fiscally more about. carefully drawn to maximize explanation or civil conver- necessary. He made a political decision. Republican chances to retain We leave these events with about the In this context, remember the same outcome as we’ve had previously, sation about the issues or their one-vote majority and the the pros and cons of the following: (1) Everyone believes in with a major pension reform that otherCongressional lines followed Richard Brodsky gerrymandering, if it protects values wise might have failed. Maybe this is the alternatives. conventional political wisdom. they support (see: the Voting Rights price we pay in a democracy for getting Better late than never. All this attracted highRedistricting is a political process, Act.); (2) Appointed commissions are things done. octane, top-of-the-lungs interest from the editorial and good-government classes, and no fancy stepping will make it inferior to elected bodies in making and almost no interest from the public anything else. In most cases, it is a fairly hard decisions (see: the base-closing Richard Brodsky is a Senior Fellow at at large. In that dichotomy we find some simple process. Most Assembly districts and hospital-closing commissions of Demos, a NYC-based think tank, and at unhappy truths about our current polit- are dominated by one party. There are recent years); and (3) Voters care more NYU’s Wagner School of Public Service. very few lines you could draw that elect about taxes and schools and pensions He served in the Assembly until 2010 ical situation. The argument made by the goo-goos Republicans in the Bronx or Democrats than they do about redistricting. and chaired the Corporations and There is certainly room for a less Environmental Protection committees. and the editorialists is that the Legisla- in Oswego. But in the Senate, political control partisan way of drawing lines. But fero- He appears regularly as a contributing ture draws the lines to protect the political interests of the majority parties. In depends on how the lines are drawn. The cious rhetoric and an elitist distaste for editor on WRNN-TV and on Fox this there is a good deal of truth, but Senate Republicans presented a map the realities of politics in a democracy Business Network. their argument was couched in some of a while ago that was a doozy, and well won’t get us there. The same goo-goos who rail about the harshest public verbiage imaginable, beyond what should be tolerated. Cuomo Read more of his columns at premised on the conclusion that the led the Legion of the Outraged and prom- stalemate and the inability to comprowww.cityandstateny.com

L

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APRIL 2, 2012

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CITY&STATE


B AC K & F O R T H

ThE hiSTorian Back & Forth with Assemblyman Jack McEneny

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ssemblyman Jack McEneny may be retiring, but don’t be surprised to see him continuing to roam the halls of the Capitol long after someone else is elected to fill his seat. After all, saying goodbye to elected life isn’t the same as saying goodbye to his native Albany. For years McEneny served the Assembly as both its official historian and as co-chair of the controversial legislative redistricting task force, LATFOR. That latter role put him up against Gov. Andrew Cuomo and angry reformers bent on prying the pencil from the Legislature’s hand. But in the end, McEneny and his colleagues prevailed. McEneny spoke to City & State about his post-Assembly plans, his disagreements with the governor and his belief that “dysfunctional” is a dirty word.

City & State: Speaker Sheldon Silver said that you were leaving some big shoes to fill. Jack McEneny: I’m still going to be around. Depending on who succeeds me, I’m more than happy to give any assistance. A lot of my reputation comes from being the official historian. I [at] one time was the county historian for Albany County. And I also wrote the book on Albany, which has been reprinted four times. A lot of the institutional memory that I have comes not from being a historian but having a frontrow seat and being a participant in history. C&S: What are your plans for after the Legislature? Teaching? Writing? JM: Both of those may be an option. Of course, you always tell people you’re writing another book; that way they don’t talk ill of you, because they’re afraid they’ll show up in the book not looking that good. But I look at this as more of a sabbatical than a retirement. To me that connotation is the end of something. I look at this as the beginning of something else. Could be travel, could be writing. I speak a little Spanish. C&S: So we shouldn’t be surprised to see you around the Capitol? JM: Well, I’m on the Capitol Commission. Listening to the speaker this morning, I don’t think he’s going to ask me to get off of that. I’m on the archives board. I’m on the convention authority in Albany. I’m also on the governor’s mansion trust. It hasn’t met since [former Gov. George] Pataki came into office, but I figure by default I’m still there. You know, I was very fortunate, I did start back in the days when it was Dan O’Connell’s political machine, and it evolved into Erastus Corning’s. I also had a reputation for troubleshooting. I was a deputy county executive. C&S: Was it your institutional knowledge that led you to be named co-chair of LATFOR? JM: Yes. You’ll notice that with the exception of the 101st District, which is Claudia Tenney’s district, there’s not a lot of complaints on the Assembly side of the fence. Some of the districts are weird-looking in the city, but that’s the Voting Rights Act. Actually I would have liked to have had

CITY&STATE

more input in the constitutional amendment, because I think we could have done a much better job to discourage the unfair aspects of redistricting. C&S: But you’ve always defended the Legislature’s right to draw its own lines. JM: I defend the constitution. I think the

after being so critical of the process, ultimately signed the legislative-drawn maps? JM: He said, “If you draw it, I veto it.” And that’s when he and I would get into verbal contests saying, “You’re not going to read them? You don’t care what they look like?” But that’s an old battle. The problem is too many people concentrate on who draws the lines, rather than what the lines look like. C&S: Did the battle over redistricting influence your decision to not run for reelection? JM: No, I actually loved it. It was intellectually challenging, kept the adrena-

“i think there’s insensitivity to the human element, the flesh-and-blood element. These are not just numbers.” good-government groups—bear in mind that’s a self-designated title—can be very insensitive of the realities of political life. For example, Common Cause—and I think Sue Lerner did a wonderful job, she went to virtually everything—but they went and they prided themselves on an abstract value of saying “We don’t need to know where these candidates live. We’re going to do it blind.” C&S: You think they misunderstand how the process works? JM: I think there’s insensitivity to the human element, the flesh-and-blood element. These are not just numbers. The people who get obsessed with, “Is it 1 percent? Is it 2 percent? 3 percent?” I took the Census for the federal government in 1980. I almost killed myself with 70 hours of work for the city and 40 hours of work for the feds. But I know the Census and I’ve studied the Census. I also know that if there’s a 42 percent increase in the Asian population in 10 years in the borough of Queens alone, what does that tell you about how fluid those numbers are? If you take the undercount, which I believe happened in Queens, and then you consider that flow of humanity: They take [the Census] in ’10, you get the numbers in ’11, you’re drawing it in ’12, you’re already into 20 percent of the decade by the time you’re looking at the numbers. Does it really matter if it’s 3 percent or 4 percent? They’re almost theoretical. I would be more considered about neighborhoods and commuting patterns. But when you start acting like a computer, like the governor wanted a 1 percent variance, that’s ridiculous. These are not sacred numbers. C&S: Were you surprised that Cuomo,

line flowing. It was politically challenging. I actually enjoyed every bit of it. C&S: Any regrets? JM: There’s a lot of opportunities lost. As I look at it now, the most exciting times, like the Bragman attempted coup [in 2000]. In fact my first election made the rest of my career seem anticlimactic, because I was elected in a write-in election. I knocked off the majority leader of the county legislature. And the next year, after a four-way primary, I ended up here. I also ran against [Albany] Mayor Jerry Jennings. And for some strange reason, the next year the Democratic Party didn’t give me the designation. Life is full of coincidences. And there’s been exciting times. But if I move out of the politics, at almost every level, the lack of appreciation of tourism and cultural heritage, I really feel that somebody doesn’t get it. It’s a way to create jobs. If your only concern was to get a lot of relatively lowpaying entry-level jobs into areas of high unemployment, you’d gravitate to where the scenery is in our incredible rural areas, where unemployment is high, or you’d go where the history is, to our urban towns and villages, where urban decay is high. On the other hand, if you didn’t have any social goals but you just wanted to show off the best of New York, guess what, you’d be back in the same two areas. I just really feel that “I Love New York” is a shadow of its former self. It used $20 million at the end of the Carey administration. When I got here it was just $3 million. It’s up again, but you’re talking 21st-century dollars. It would be the greatest job-creation engine for the state if done right. C&S: Do you think Governor Cuomo can turn that around?

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JM: Based on what he’s done with the Heritage Trail and just here around the Capitol, I have great hopes for Governor Cuomo. I think he does get it, and I think he wants to exploit this heritage. C&S: How has Cuomo changed the dynamics in Albany? JM: It’s early in his career. But even those that disagree with his agenda—Tier VI or voting on the gambling amendment at odd hours in the night with a message of necessity—but I think people who even might have problems feel good about themselves. They feel like there’s someone’s actually in charge who says he’s going to do what he says he’s going to do. Nobody’s saying “dysfunctional,” but Washington helps that. I always felt the Brennan Center was unjust and unfair when they came out with the catchy phrase that every editorial board loved, quote “the most dysfunctional legislature in the United States.” That told me that somebody wasn’t very well-traveled. C&S: You don’t think it was applicable two years ago? JM: No, I don’t think it was applicable. I think what rational educated people say early in their careers is, never say “All or none.” And “most dysfunctional”—I think that was a great relief for Louisiana. It’s that extreme language we’re seeing down in Washington and [it’s] very divisive. You’ve got a lot of half-truths blown up. A while ago I was sitting and listening to a fascinating debate on a subject I had no interest in, dragging on and on, and I was going through the Red Book. It was a time you had all the scandals and indictments in the State Senate. I wondered how many people held the title of assemblyman. And I counted, at that time, 337. And then I wondered how many of them have been indicted, much less convicted—and, don’t forget, I’ve been here since 1991. I think I came to eight, which was less than one-third of 1 percent. The unfairness of it, that one-third of 1 percent can be judged as the norm. We’re in an age without heroes. We don’t have them with athletes or the clergy or business. It’s a very cynical age. I met such wonderful, sincere people on both sides of aisle, and it does them a disservice. ahawkins@cityandstateny.com april 2, 2012

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City and State - April 2, 2012  

The April 2, 2012 issue of City and State . Targeting the politicians, lobbyists, unions, staffers and issues which shape New York City and...

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