FIX ALBANY



In 2006, Nassau County Executive Tom Suozzi, at the time considered a suburban revolutionary, launched a movement to reform capitol politics in Albany. His agenda for state government reform FixAlbany was presented in a website www.FixAlbany.com

Tom Suozzi: The Reformer
http://www.youtube.com/watch?v=bCCqggVI1y4

Regrettably, this insightful and inspirational website has been taken down. Regardless, Citizendan will post dated newspaper accounts of Fix Albany and list reasons that support a reformation of Empire State politics.

1.  New York Times: After The Election, Fix Albany
2.  New York Press: Probing Spitzer, fixing Albany and mounting elephants
3Governing Magazine: Public Official of the Year 2005 - Nassau County   
    Executive Tom Suozzi

4. Tom Suozzi The Reformer 9/8/2006 Video
5. Tom Suozzi's Vision for New York
6. The Phantom of New York: Quasi-governmental Authorities


New York Times
November 7, 1994

After the Election, Fix Albany 
<back to top>

Gov. Mario Cuomo and his Republican challenger, State Senator George Pataki, agree on one thing. The current legislative process in Albany is a mess. 

Voters should remember this and press every state official who is elected tomorrow to shake up the closed system that has the Governor, the Senate majority leader and the Assembly Speaker deciding most major issues in secret negotiating sessions. This goofy practice bypasses open debate of the available policy choices, delays important issues until the last hours of the session and leaves the public, and even many state legislators, out in the cold. 

The need for fundamental legislative reform is one of the sleeper issues of the campaign. It has received scarce attention compared with, say, each camp's plan for tax-cutting or Mayor Rudolph Giuliani's endorsement of Mr. Cuomo. Yet changing the way the Legislature works -- or more often does not work -- to resolve contentious issues like the budget or state funding formulas is one of the huge challenges facing the next governor. Such change will not come easily or without risk-taking leadership on the part of the governor. Minor tinkering with procedure will not do. 

The problem begins with the so-called "strong leader" system, which makes members beholden to the party leader in their chamber for basic items like their office allotments and their backdoor salary supplements known as "lulus." However, on certain key issues where leadership would help, the Republican Senate majority leader, Ralph Marino, has watered down his power by saying he will not act unless a majority of his members agree -- a situation that makes it hard for him to negotiate with other leaders and keeps critical bills bottled up in Republican conference. 

The Legislature, it is plain, will not change by itself. But by putting a spotlight on its lack of efficiency and accountability, a governor can help move important legislation and build pressure for critical internal changes. For example, the Legislature must be forced to pare its mysterious and bloated $177 million budget that in reality is a way of using tax money to finance a giant re-election machine. Moreover, the new governor ought to lead a public fight to clean up an influence-peddling problem that closely resembles the one in Washington. 

Though Mr. Pataki has some ideas for opening up the budget process, as a member of the State Senate he has voted with his party to defeat reasonable efforts by the Democratic Senate minority to open up the legislative process. For example, he voted to sustain the secrecy of party caucuses where legislative issues are decided. 

Mr. Cuomo, by contrast, has long backed measures for more open and honest government. Over 12 years as Governor, though, he has grown too comfortable with the closed negotiating process. If re-elected, he vows to do more of what other governors -- and even Presidents -- do when they want to move a stalled bill: reach out beyond the party leaders in each chamber to rally individual legislators and the public. 

Over all, the fact that both candidates at least are talking about glaring flaws in the state's legislative process is an encouraging sign. It means that this election may produce progress on Albany's outdated tradition of secrecy, stalemate and last-minute legislating. 
<back to top>


KAMIKAZE SUOZZI

Probing Spitzer, fixing Albany and mounting elephants 
<back to top>

http://www.newyorkpress.com/19/1/news&columns/azipaybarah.cfm

By Azi Paybarah 

NASSAU'S TURNAROUND
FIXING ALBANY
PICKING ON THE DISABLED
THE CHRONIC OUTSIDER
SPITZER'S VICTIMS
THAT ELEPHANT

When Newsday wrote about Tom Suozzi’s bid to become governor this week, they put it next to stories with similar possibilities: President Pataki and Osama bin Laden’s surrender inside a Milwaukee police station. And that’s the paper that likes him.

When I described his all-but-announced gubernatorial campaign as “a long shot,” Suozzi corrected me. “Very long shot.”

So don’t worry if you’ve never heard of him. Eighty percent of 404 likely Democratic voters quizzed in a Sienna poll last week said they had never heard of him.

“Do you know which people know who I am?” Suozzi asks, sitting inside his Mineola office, his feet perched up on a bronze plaque that doubles as his coffee table. “Good government groups, policy wonks, political insider types,” he says, his voice beginning to trail off at the weight of that responsibility. After a slight pause, he resumes: “Editorial boards, those types of groups know who I am.”

Suozzi tells me that his name recognition is better than Chuck Schumer’s was the year before Schumer ran successfully for U.S. Senate.

But while Harvard-educated Schumer ran against Senator Pothole, Suozzi’s primary foe, State Attorney General Eliot Spitzer, has a more intimidating nickname: The Sheriff of Wall Street. And he’s got the support of the entire state Democratic Party operation to take out the 42-year-old, boyish Nassau County Executive who, when told to take his feet off the table, sarcastically tells his campaign manager, “Okay mom.”


Nassau’s Turnaround
<Back to Top>

Despite his name (un)recognition, Suozzi’s resume is based on Nassau County’s fiscal recovery.

Nothing says rock bottom like post-Sept. 11th rejection. The state agency watching Nassau’s finances rejected the proposed 2002 budget presented by Suozzi’s predecessor, Tom Gullota. “We cannot let the national emergency or coming election prevent us from doing what is right and doing it now,” wrote Chairman Frank Zarb of the Nassau Interim Finance Authority.

Years of one-party rule had finally taken their toll on one of the richest (and, until recently, most Republican) counties in America. More than 45 percent of county cops took home $100,000 in pay, according to Newsday. Despite the GOP’s smaller government mantra, Nassau’s payroll swelled, and its tax rate exploded.

The budget proposed by Gullota at the end of 2001 would have put Nassau in the red by $208.6 million by 2005, NIFA said.  Instead last year Nassau ran a surplus and received its 11th bond-status upgrade in four years, the most of any city, state or municipality in America, and Suozzi was named one of eight public officials of the year in Governing for having orchestrated the turn-around.

Suozzi’s raised property taxes 19 percent (and quickly promised never to raise them again), cut 1,400 county jobs from the pay roll, trimmed “waste, fraud and abuse,” refinanced the remaining debt and negotiated what he termed “historic” givebacks with “our friends” in the unions. That’s the same plan he wants to use in Albany.

When asked about the county’s turn-around, the guy who lost the 2001 Democratic primary to Suozzi, naturally, considers the credit misplaced. “The commitment for the $100 million [grant from Albany] and the commitment to establish NIFA happened in 2000,” Assemblyman Tom DiNapoli explained. “The benefit and fiscal improvements happened in the years since then.”

Suozzi, who said he’s heard DiNapoli make the charge before, seemed unfazed as he started dialing the phone. While it rang, Suozzi explained, “My guy who is my deputy county executive for finance was DiNapoli’s top policy guy in his campaign. Okay?”

Speaking to his deputy county executive, Suozzi repeated DiNapoli’s argument. The voice on the speakerphone erupted in laughter. He hung up and reminded me again who his deputy used to work for.

The county’s revival helped Suozzi do what even his idol John F. Kennedy couldn’t: beat Nassau Republicans. Forty-eight hours before the 1960 Kennedy-Nixon election, Kennedy huddled next to Tom’s father Joseph, then Nassau County democratic chairman, at a rain-soaked rally. The would-be King of Camelot pleaded with supporters to hit the polls and prove “that Nassau County has gone Democratic.” It hadn’t. In fact, “There’s never been any Democrat that won the presidential race in Nassau County until Bill Clinton came along,” Suozzi noted in a radio interview. Who ran Clinton’s New York campaign? Harold Ickes, a lawyer with Tom’s dad at, drum roll please, Meyer, Suozzi, English & Klein.


Fixing Albany
<Back to Top>

Suozzi’s gubernatorial campaign against Spitzer is an extension of his fight against all things Albany. Spitzer, who’s been in Albany since 1999, built a reputation for attacking Wall Street, but never his colleagues. Democratic Assembly Speaker Sheldon Silver was caught vacationing in a heavily-discounted Las Vegas hotel room while the hotel’s owner had business pending before the legislature. Democratic Assemblyman Clarence Norman’s indictment for pocketing campaign cash was picked up by the Brooklyn D.A. (whose own campaign finance racket was never investigated either). After getting caught charging taxpayers for travel expenses paid for by lobbyists, Democratic Assemblyman Roger Green “retired” momentarily, avoiding major penalties, and promptly went unchallenged as he ran for his “open” seat. He’s now considering running for Congress.

But “Mr. Spitzer, who is running for governor, now has a big question mark on his resumé as a reformer,” The Times, usually Spitzer’s biggest booster, editorialized last July, because of another scandal: Medicaid.

The state’s $44 billion Medicaid program is—increibly—almost half of the state’s total budget. But from Albany, it looks like a great moneymaker.

Here’s the scheme: The cost of the program is split three ways. D.C. kicks in half; and Albany and local counties split the other half. From Albany and from the seats of local government, it looks like spending a dollar brings in three free ones, so spending and fraud have of course exploded. New York spends more on Medicaid than California and Texas combined.

Mayor Bloomberg quietly lobbied Albany’s leadership to mind their money with little success, and Spitzer has done nothing; no Wall Street-style investigation into widespread reports of widespread Medicaid fraud. All of which bolsters Suozzi’s candidacy and the notion that he, not Spitzer, is the real reformer. (Suozzi refused to go on the record with anything but praise for at least some of Spitzer’s work as Attorney General.)

Suozzi seized the moment, and started Fix Albany, a shoestring operation that sought to cap Medicaid spending and fund Democratic candidates looking to unseat incumbents of either party in Albany. Shortly after announcing his plan, the influential lobbyist he’d hired, Patricia Lynch dropped Suozzi as a client. Now that is responsive.

It wasn’t until editorial boards and policy wonks (Suozzi considers himself a wonk) echoed an NYU study that called New York’s state legislature the worst in the nation that a cap on Medicaid spending was finally signed.


Picking on The Disabled
<Back to Top>

To date, Suozzi is the only elected official pursuing anything resembling reform. One Queens Democrat said he spoke out publicly about the need for term limits in Albany, once. “My phone lit up like a Christmas tree,” he said. “Some were friendly, saying ‘Don’t do this.’ Others were like, ‘You’re dead.’”

In 2004, Suozzi ran his own candidate for Assembly, Charles Lavine, against a less-than-impressive fellow Democrat from Long Island. Suozzi won, and deemed it a wake up call to Albany. One Democratic operative was less impressed: “Beating David Sidikman is like picking on the disabled.”

The heart of Sidikman’s district was in—where else?—the Suozzi-loving city of Glen Cove. The committee’s other victim, Senator Nancy Lorraine Hoffman, represented the oft-frozen city of Syracuse. Fix Albany sent her challenger, David Valesky, $8,500 and sent an additional $11,500 to the county’s Democratic committee. Filed under “field expense” were countless activists who helped the reform effort (like Tracey Denton of the highly-regarded and very popular Democracy for New York Web site).


The Chronic Outsider 
<Back to Top>

Seeing Suozzi standing with Bill Clinton and Harold Ickes, it’s hard to remember Suozzi is the outsider.

“It’s highly likely Suozzi won’t get the support of a single legislator or congressman outside of Nassau,” said a Democratic operative familiar with Nassau. Running against Spitzer and his supporters will make even “the JFK of Long Island” persona non grata.

Big or small, Suozzis “were celebrities in Glen Cove,” remembers Yonkers City Council president, Democrat Chuck Lesnick. “I was 11 and he was eight. And I remember his cousin Vinny ‘cause Vinny’s dad was mayor [of Glen Cove] and Tom’s dad had been mayor prior to that, so they were celebrities.”

Tom’s dad, Joe Suozzi, was mayor of Glen Cove in the early 1960s and later became a senior partner in a firm now called Meyer, Suozzi, English & Klein. His law partner, Jack English chaired the Nassau County Democratic Organization.

The Suozzis were Nassau’s Kennedys—and they knew it. “Tom has always had an affinity for Kennedy. Even his kids are named Caroline and Joseph,” said Lesnick. Suozzi’s other kid is named Michael, just like Bobby Kennedy’s son. (“They’re family names,” claimed Suozzi campaign manager Kim Devlin.)

But the Meyer, Suozzi, English & Klein juggernaut did more than spawn another Kennedy obsession. Dubbed “The Firm” by other lawyers, they’ve ruled the roost in Nassau for years. Along with Suozzi, the job of running Nassau County politics fell onto partners Bernard Meyer and John Klein at various times.

It’s hard to be an outsider when Harold Ickes is the guy one cubicle over from Dad. Other notable employees of The Firm include: Basil Patterson, father of Senate Minority Leader David Patterson of Manhattan; Harold Ickes, and Robert Gaffney, former the executive of neighboring Suffolk County.

Suozzi pondered his family’s outsider credentials when asked about his cousin. Ralph Suozzi ran for mayor of Glen Cove (insider) against the Democratic Party (outsider) and against the wishes of cousin Tom, who endorsed the incumbent. “So is he an outsider or an insider?” Suozzi asked, letting the matter linger in the air mysteriously.

Looking at Suozzi’s 2001 campaign against Tom DiNapoli serves as a good reminder of who is inside and who is not. Eliot Spitzer endorsed DiNapoli, as did Chuck Schumer (who now reminds people he “generally” stays out of primaries, and will do so this year). Shelly Silver came out for DiNapoli, as did the state comptroller at the time, H. Carl McCall, and most every other Democrat recognizable in Nassau. And they lost. DiNapoli chalked it up to the volatile days after Sept. 11 when Suozzi, as Glen Cove mayor, made headlines for delivering aid to affected Nassau residents.

In a candid on-line account of that 2001 race, strategist Mark Sump admitted, “[T]he majority of consultants were arguing strongly for staying positive throughout, while [Suozzi] and his committee of local advisors wanted to rip DiNapoli apart.” Sump later told me, “There were plenty of things that we could have suggested [but] if we had gone negative, it probably wouldn’t have worked.” What they “suggested” was a subtler insult. “We’ll build up this [theme]‘He can do it because he’s done it.’ Tom DiNapoli’s a fine person. That’s okay. But he hasn’t really done anything. He’s a legislator.” The Fix Albany seeds were already planted.

But perhaps Suozzi could use some legislative instincts himself. One political admirer who asked for anonymity called him “The closest thing to a DLC Democrat New York has,” and “a giant among midgets.” But for all Suozzi’s big plans, even this booster conceded that the giant is himself a midget when it comes to specifics. Visit the Fix Albany Web site—the complaint-to-proposal ratio is awfully high.

One set of specifics he does offer is  a list of his more famous admirers: “If you want to call people about me, Mario Cuomo is not encouraging me to run, but you should call him about me… You should call Senator Joe Lieberman. He knows me very well. Terry McCauliffe knows me very well.

“You should call these big players who are not part of the establishment,” Suozzi goes on, making little quote marks with his fingers after that last word. After naming some policy wonks at NYU’s Brennan Center and the Citizen’s Budget Commission, Suozzi adds, “You should try to find some rebel types.”

When the silver-haired Chairman of the State Democratic Party, Herman Denny Farrell, said in a television interview that he hadn’t spoken to Suozzi in two years, it only helped reinforce his outsider credentials.

When Suozzi’s campaign manager replied, a second image appeared.: “Mr. Farrell must have forgotten when Tom called him earlier this year to congratulate him on his new daughter,” she told me, referring to the 70-year-old Farrell’s recent love child. Pow. Suozzi, the hitman.

Devlin, in an earlier conversation, dismissed the question of Suozzi’s street cred. “It’s an insider-outsider argument,” she said, meaning that voters who go to the polls won’t care. “800,000 people voted” in the 1998 state Democratic primary, she told me. “There aren’t 800,000 insiders.” She’s been doing her homework.


Spitzer’s Victims
<Back to Top>

The only things comparable to Suozzi’s sharp suits and elbows are Spitzer’s stubbly chin and voluptuous forehead, which suit the A.G.’s image as the Wall Street regulator. One especially ecstatic  New York Times magazine headline might have been written by the candidate himself: “Can Spitzerism Save the Democrats.”

In the wake of Enron, Wall Street executives became guilty until proven innocent, and Spitzer’s very public investigations have further pressed that notion. His critics, who, not surprisingly, work on Wall Street, say that just below the John Wayne swagger is an actor rehashing a tired (yet effective) role. In front of a camera, nothing looks guiltier than a rich guy in a nice suit.

“I don’t want to go on the record defending any of these guys,” Suozzi says of the people Spitzer has investigated and who have vowed to avenge themselves against Spitzer (the most hated man on Wall Street since Rudy Giuliani), in part by vowing to fund Suozzi’s campaign.

Suozzi sees no liability in taking this money. “I could probably raise money from those guys if I wanted to.” He hasn’t so much as had to ask, though.

Suozzi’s argument against Spitzer is essentially that even if he wins his suit against the New York Stock Exchange and former NYSE head Dick Grasso has to give back a portion (or even all) of his nine-figure severance package, it goes to all the millionaires who own shares of the Exchange. It doesn’t go to the tax payers. It doesn’t go to the public. It’s a private dispute that has nothing to do with Spitzer’s job as Attorney General.

Langone has already vowed to back Suozzi, who, as much as I prodded, stuck to a very safe script. “Eliot Spitzer has been a good attorney general,” he repeatedly told me. When asked about Langone, John C. Whitehead (who’s publically accused Spitzer of threatening him) and other Spitzer foes, Suozzi said, “Ken Langone is a billionaire; he doesn’t want anything from the government.” And why not take his Spitzer-hating money, then?


That Elephant
<Back to Top>

With a promise not to run for another term as County Executive, and a “very long shot” chance at being governor, there is a very real chance Suozzi will soon exit the public stage. “I’ve done all that I wanted to in Nassau,” he relents after a while.

The humor, though, lingers. Seemingly poking fun at the idea that his travails against the Democratic Party are a Republican’s dream come true is a black and white photograph in his office of Suozzi on top of an elephant, with three signatures.

You look good on an elephant —Rudy Giuliani

You belong up there —George Pataki

Tom, we need you —George W. Bush.

It’s a striking image, one Suozzi likes to use selectively. Though I was pointed to the photo while there, repeated calls to get a copy of it for this article were met with the run-around. “It won’t reproduce well in a newspaper,” Devlin told me.

<back to top>

 

Governing Magazine Public Official of the Year
Thomas R. Suozzi - High-Voltage Transformer
<back to top>

http://www.governing.com/poy/2005/suozzi.htm

Whatever else he does in his career as the top elected official of Nassau County, New York, Tom Suozzi will be remembered as the guy who made it just another old inner suburb — beset by the usual traffic congestion, high home prices, pockets of poverty and outdated infrastructure. This, believe it or not, is a major improvement.

When he was elected county executive in 2001, Suozzi, a Democrat, inherited a county that was not just on the brink of disaster but had toppled over and was nearing terminal velocity. Nassau makes up the western end of Long Island and is one of the wealthiest counties in the nation in terms of per-capita income, but years of fiscally imprudent governance by an entrenched political machine had cost it dearly.

It had amassed nearly $3 billion in debt; its bonds were at junk status; the state had created a financial oversight board and was threatening to take over; public buildings were close to condemnable; roads and parks were going to ruin; and the county’s administrative apparatus ranked among the least effective in the country.

Even before he was elected as executive, Suozzi persuaded the narrow Democratic majority in the county legislature to pass a 19.4 percent tax increase for the 2002 budget. Once in office, the former accountant and attorney set out methodically to get the county back on its feet. He worked with the state oversight authority to spread out the county’s debt service and cut back drastically on capital spending. He pared the workforce to its smallest level in three decades, renegotiated contracts with the police and fire unions, reshaped the administrative structure and held meetings with county employees to tell them, “Nobody ever gets to say, ’That’s the way it’s always been done.’ ”

The result is that Nassau is slowly climbing back to respectability. It has balanced its budget every year since Suozzi took over; built up $200 million in reserve funds; had 10 upgrades of its bonds, to the point where it is back in the all-important ranks that start with “A”; and reduced from 16 percent to 12.5 percent the portion of every dollar going to debt service.

But now that Nassau “just has the same problems as everyone else,” as the 43-year-old Suozzi puts it, he wants to turn it into a model for how old suburbs revitalize themselves. “Instead of being a transactional leader, he sees himself as a transformational leader,” says Michael D’Innocenzo, a historian at Hofstra University.

This is not without its political risks, especially if — as in Suozzi’s case — it’s done with apparent disregard for the diplomatic arts. Suozzi has made no effort to work with the GOP minority in the county legislature, and he is roundly disliked by both Democrats and Republicans in the state capital for his “Fix Albany” initiative, an effort to end the velvety electoral comfort that incumbent legislators enjoy. As Newsday recently put it, “Suozzi melds a reformer’s sensibility with a lightning rod’s ability to pull destructive forces from the sky. He honestly seems to believe he can kick opponents in the head one day, and have them willingly do his bidding the next.”

Yet much of what Suozzi is aiming at makes sense. He argues that built-out suburban counties have to get their fiscal houses in order by addressing their own, internal inefficiencies, and then by insisting that state governments stop passing down unfunded mandates. He launched his “Fix Albany” campaign after trying to craft a sewer and stormwater authority that got hung up in state legislative politics and used it to persuade the legislature to help counties deal with soaring Medicaid costs.

Then, Suozzi argues, counties have to figure out how to grow. As mayor of Glen Cove from 1993 to 2001, he focused on brownfield and downtown redevelopment. In Nassau’s case, his plan includes encouraging high-tech industry, building up its sports and entertainment facilities, expanding public transit, addressing the county’s growing poverty rate and promoting denser housing development that is affordable for young people and seniors. “We want to keep all the things we love about suburbia,” he says, “and attack the problems.”

— Rob Gurwitt
Photo by David Lubarsky

<back to top>

 


 


The Phantom of New York:
Quasi-governmental authorities spend billions of dollars of Empire State taxpayers’ money every year. They don’t have to answer many questions about it.
http://governing.com/textbook/auth.htm 

<Back to Top>

From Governing’s
November 2004 issue

ONE STEP REMOVED
CLOSED DOORS

BIG-TIME DEBT
GROPING FOR SUNLIGHT

Every politico in New York State is familiar with the story of Robert Moses, even if few have finished reading all 1,100 pages of Robert Caro’s biography of him. Moses, back in the 1930s, ’40s and ’50s, amassed the power to build roads, bridges, parks and housing projects in New York City and all over the state, pretty much however and wherever he wished, through his domination of public authorities — quasi-governmental agencies of which he controlled more than a dozen. Using the authorities, he could issue bonds to pay for public works and collect tolls or fees, all without seeking permission from any formal legislative body. He was able to exercise vast discretion with virtually no accountability at all.

Public authorities aren’t quite as powerful today as they used to be, due in part to the backlash against Moses’ abuse of them. But they remain very crucial, if little-noticed, institutions not just in New York but across the country. They manage an impressive array of America’s infrastructure: airports, stadiums, convention centers, transit systems, turnpikes, bridges, tunnels, cargo facilities, sewer and water systems, public housing and even parking garages. These are critical functions. So it seemed like a reasonable request, given the authorities’ significance and their checkered past, when Alan Hevesi, the comptroller of New York State, recently asked for a list of all of the state’s public authorities. Surely a complete list must exist somewhere, Hevesi thought.

It didn’t. So Hevesi’s staff went on a public authority hunt. Flipping back and forth through volumes of state statutes, they recorded the names of hundreds of bureaucracies. Some were familiar to citizens, such as the New York State Thruway Authority and the Port Authority of New York and New Jersey. But many were obscure entities that few have ever heard of: the Industrial Exhibit Authority; the Islip Resource Recovery Authority; the Overcoat Development Corp. The list went on and on. This past February, in a report that likened these bodies to a “secret government,” Hevesi put the tally of state and local public authorities in New York at 640. Since then, his staff has “discovered” 70 more. They’re still not sure they’ve found them all.

At the very least, it is a sign of weak oversight if a state government doesn’t even know how many public authorities are acting in its behalf. But lately there have been other signs of poor management and questionable contracting. The Metropolitan Transit Authority, which runs the subways, buses and commuter trains in the New York City area, was accused of lying about its budget numbers in order to justify a fare hike. In another case, a subsidiary of the Thruway Authority known as the Canal Corp. offered lucrative development rights along the Erie Canal to a campaign contributor of Governor George Pataki’s — for a paltry $30,000. Attorney General Eliot Spitzer put it bluntly when he said that “public authorities are becoming to New York what off-balance-sheet partnerships were to Enron.”

A consensus is building that something about public authorities is broken in the Empire State — even if Pataki, Spitzer, Hevesi and the legislature don’t agree on what to do about it. At the same time that the authorities are being attacked, however, more of them are being created. For example, a new state-local authority was just established to build a convention center in Albany. Discussions are underway to create an entertainment authority to manage sports and arts facilities in Greater Binghamton.

The biggest new entry, however, would be in the Big Apple, where the city and state are talking about forming a development corporation to redevelop the west side of Manhattan. “Public officials can cluck their tongues and say authorities are out of control,” notes Steve Malanga, a senior fellow at the Manhattan Institute, a conservative think tank. “But when an issue comes up that they think can’t win with the voters, they go back to using authorities.”


ONE STEP REMOVED
<Back to Top>

Public authorities have been around since the 1920s, when good-government reformers suggested that quasi-independent agencies might perform certain tasks more efficiently than government could. There were good reasons to believe that, and there still are today. “Public authorities are pretty darned useful,” says Kathryn Foster, a planning professor at SUNY Buffalo.

The original argument was essentially that authorities could remove politics from the delivery of basic services. Take sewers. If every rate hike had to go to a public referendum, long-term maintenance might never get done. Authorities are meant to circumvent such political messiness. They’re typically set up one step removed from city, county or state government. They’re supposed to enjoy the managerial freedoms of the private sector, while retaining some of the accountability that is so important in the public sector.

It’s not easy to generalize about authorities. Not only do they perform vastly different functions but they’re also structured quite differently from state to state. Some authority boards are elected, while others are appointed by governors or mayors. A few cross political boundaries, such as the Delaware River Port Authority, whose board is appointed by the governors of Pennsylvania and New Jersey. Some receive appropriations from legislatures, but most authorities can raise money on their own, from tolls, fares or user fees, and some can levy taxes on the public at large.

One thing that is clear about authorities is that their number is growing faster than that of any other slice of American government. It’s difficult to pin down an exact figure for the whole country, precisely because they are so loosely defined from one state to the next. Nevertheless, the U.S. Census Bureau makes an effort. In 2002, it counted some 35,000 “special district governments” — a label that does not include school districts. By contrast, there were only 26,000 of these quasi-governmental institutions in 1977.

Much of this growth is in booming suburbs and exurbs, where development means that there are new water systems to manage, new parks to build, new bus systems to run. More often than not, a public authority is given these responsibilities. But some of the authorities’ growth also reflects the changing needs of states and older cities. In Moses’ day, many authorities literally paved the way to a new automobile era by building the first highways and bridges. These days, in urban areas, newly minted authorities are more likely to be building arenas and convention centers, or playing the role of lead developer in publicly financed real estate deals.

A new authority’s strongest selling point is often its ability to stay focused on a single goal. For example, Washington, D.C., just created a new corporation to finance an $8 billion redevelopment plan along the Anacostia River. The job could have gone to the D.C. economic development department, or to an existing authority that does redevelopment work citywide. But planners didn’t want to risk seeing the Anacostia program get lost in an overstuffed portfolio. They preferred to create a separate institution whose managers have one job — redeveloping the waterfront — rather than many.

Another reason why the number of authorities keeps growing is that old ones rarely seem to go away. Look at the Pittsburgh Stadium Authority, created in the 1960s to build and manage Three Rivers Stadium. Pittsburgh demolished that facility four years ago, replacing it with twin football and baseball stadiums — built by yet another authority. Still, the old Stadium Authority lives on, an oddity that nobody paid much attention to until charges hit this summer that an authority accountant had embezzled $193,000. The authority’s ostensible raison d’etre is to pay off the bonds on Three Rivers, but Pennsylvania state Representative Jack Wagner thinks that’s a bogus excuse. “There’s no reason why that authority and the debt can’t be merged into another authority,” Wagner says. “This is nothing more than a duplication of government services.”


CLOSED DOORS
<Back to Top>


A swell of complaints about alleged impropriety at authorities is what put reform on the agenda in New York. The MTA’s budget scam and the canal land giveaway were only the beginning:

• The New York Racing Association, the quasi-governmental agency that runs three horse-racing tracks, was indicted as a body and many tellers were convicted of tax fraud and money laundering.

• The head of the New York State Bridge Authority, who was also the father-in-law of a close Pataki adviser, resigned when it was revealed that he had spent $25,000 of the authority’s money on personal trips and rung up $80,000 worth of questionable credit card bills.

• Former U.S. Senator Alphonse D’Amato, now a lobbyist, received a $500,000 fee for a placing a phone call to the MTA and persuading the authority to help his client get a loan. (An investigation cleared D’Amato of any wrongdoing.)

”Here’s the reality,” says Hevesi, whose audits have turned up a few of the latest transgressions. “Some authorities are very effective and well run. But a lot are mismanaged and some are corrupt.”

Pataki thinks that assessment is too negative. Like New York governors before him, Pataki, a Republican, influences many of the state authorities through his appointment power. His aides say he wants reform, but that much of the recent controversy is little more than political grandstanding. They insist that Spitzer, a Democrat, mostly wants Pataki’s job, and another authorities critic, Democratic Assemblyman Richard Brodsky, wants Spitzer’s job. Hevesi, too, is an elected Democrat. “We’re proud of the work of our authorities,” says Joe Conway, a Pataki spokesman.

But it is not just partisans who are calling for reform. Good-government groups have come to see the authorities as a subset of Albany’s legendary governance problems (the state budget is typically decided in secret by three men, universally known as the “triumvirate”: currently Pataki, Democratic Assembly Speaker Sheldon Silver, and the Senate’s GOP Majority Leader Joseph Bruno). “Getting a handle on what the public authorities spend and how much money they raise is very difficult,” says Diana Fortuna, president of the nonpartisan Citizens Budget Commission.

Authorities haven’t had to report their finances in any consistent way, and their budgets don’t show up on the state government’s books. Authorities aren’t subject to the same contracting or lobbying rules that state agencies are, even though they spend billions of dollars every year. If you want to know why an authority picked one vendor over another for a important contract, it is nearly impossible to find out. Nor is it easy to track how much lobbying contractors do, or how successful they are at it.

Top jobs at authorities are considered plum positions in New York, with salaries that often exceed six figures. Patronage is the prerogative of any governor, of course, but Albany insiders say that Pataki, more than his predecessors, has used the authorities to enrich his friends and campaign contributors. For example, a former mayor of the town of Peekskill, who is also a childhood friend of Pataki’s, found his way to an executive vice president job at the New York Power Authority. Another friend, who had headed Pataki’s security detail, also got a top job with the power authority. Blair Horner, a lobbyist with the New York Public Interest Research Group, argues that the conversion of authorities into patronage mills defeats their original purpose. “The idea that these authorities are semi-autonomous entities staffed by career civil service types who are divorced from politics has changed. They’re now agents of the executive branch who are not subject to the same oversight.”


BIG-TIME DEBT
<Back to Top>

Who are the authorities accountable to? That answer isn’t always clear. Pataki is prone to issuing press releases anytime an authority generates good news, such as when the Lower Manhattan Development Corp. (LMDC) opened four reconstructed ball fields in a park on the East River. When events get politically dodgy, however, Pataki tends to emphasize the authorities’ independence, keeping his own hands clean.

The messy debate over rebuilding the World Trade Center — detailed in Paul Goldberger’s new book “Up from Zero” — is a good example of this. Pataki, more than any other public official, held great sway over Ground Zero: His appointees led the Port Authority, which owned the land, as well as the LMDC, which ran the planning process. As early as the beginning of 2002, Pataki could have settled key questions regarding the lease on the Trade Center. But he was in the midst of a re-election campaign that year and might have offended voters who preferred one rebuilding plan over another. Rather than set clear terms for the planning process, he let the governmental, quasi-governmental and private parties involved squabble with each other. “Pataki talked about bringing consensus and public input to the process,” Goldberger writes. “But he seemed often to be working to assure that the process would be slow, convoluted and more than a little bit opaque.”

Finally, there is the huge amount of debt that New York’s authorities have run up. The state is not allowed to borrow money without voter approval, but that rule doesn’t apply when it’s authorities that are doing the borrowing. Consequently, these entities are used like credit cards. State authorities are currently carrying approximately $114 billion in debt — 28 times more than the $4 billion issued by New York State. Much of the authorities’ debt is backed by highway tolls, subway fares or other fees. But a staggering amount of it — $43 billion — is supported by state government, meaning that if the authority that issued those bonds defaulted, taxpayers would be on the hook.

It is the job of an institution called the Public Authorities Control Board to ensure that that doesn’t happen. But the operations of this board are even harder to decipher than those of the authorities. The PACB was created in 1976, when one of the largest state authorities, the Urban Development Corp., nearly collapsed. The control board must approve any debt issued by the 11 largest state authorities. There are three voting members — each a representative of the Pataki-Silver-Bruno triumvirate — and decisions must be made by consensus. What that means in practice is that the PACB makes its decisions the Albany way: behind closed doors.

Not that the PACB doesn’t meet in public. It does, every month, in a vaulted pink room on the first floor of the Capitol. But by the time this happens, all the decisions have been worked out in advance. At its public hearing in September, the PACB zipped quickly through a lengthy agenda, approving $384 million worth of authority financing in exactly 20 minutes. All that remained for public consumption was a pro-forma flurry of motions, seconds and ayes.

Barbara Bartoletti, a lobbyist for the League of Women Voters, attends these meetings regularly, “just so that they know the public is watching.” After five years of observing from the back of the room, Bartoletti says the PACB remains a mystery to her. “We’re talking about billions of taxpayer dollars,” Bartoletti says. “We can’t crack why decisions are made the way they are. We don’t have a clue about where the money is going and whom it’s going to.”


GROPING FOR SUNLIGHT
<Back to Top>

Exactly what can be done about the problems with authorities is open to argument. Pataki favors an approach that aims to do for authorities what the federal Sarbanes-Oxley law did for corporate governance. In February, Pataki’s chief of staff issued a memo to the 31 state authorities most tightly under the governor’s control. The memo called upon them to implement so-called “model governance principles,” developed by corporate governance expert Ira Millstein. Pataki also asked Millstein to head a commission, whose June draft report fleshed these principles out further.

Millstein’s suggestions include standardizing financial reporting among the authorities, and making more of it publicly available. He also would have each authority appoint an independent audit committee. The bulk of Millstein’s recommendations, however, have to do with the authorities’ boards. Many boards have developed reputations for rubber-stamping management decisions. Millstein thinks boards should be structured to have more independence. He also thinks that if board members went through extensive training, they might take the oversight part of their job more seriously. “Sunlight and active boards will be as much of a cure as we can get at this point,” Millstein says.

Hevesi and Spitzer agree with most of Millstein’s proposals, but don’t think he goes far enough. They have joined together on more sweeping legislation that would, for the first time in 50 years, prune back the number of authorities in New York. The plan is to have a commission sort out those authorities that have outlived their usefulness, or whose duties can easily be handled elsewhere in government.

Hevesi and Spitzer would make other changes. Their proposal would rewrite lobbying and procurement rules so that authorities and state agencies are treated the same. That means the controller would get a veto over large authority contracts. It also means that anyone who lobbies an authority would have to register with the state lobbying commission. In September, Hevesi added another reform he would like to see: He wants authority spending to be considered “on budget” in the state’s books.

Assemblyman Brodsky proposes a different approach, one that was passed by the Democratic Assembly in February, but died in the Senate. Brodsky would create new layers of oversight, including an inspector general’s office for public authorities, as well as an independent budget officer. In September, Brodsky upped the ante, calling for a constitutional amendment that would abolish all public authorities, wrapping their functions back into state agencies. That was more a statement of principle than a realistic policy proposal. Still, Brodsky says, “anything authorities can do can be done directly by government on-budget, instead of hidden off-budget.”

All the reform rhetoric makes officials at some authorities cringe, especially those that are widely acknowledged to be well run. In over-reacting to a few scandals, they warn, reformers might take away the independence that has allowed some authorities to thrive. Take the state Dormitory Authority, which started in the 1940s building dorms at teachers colleges, and has since become a well-regarded all-purpose builder of school and hospital facilities. Claudia Hutton, the authority’s spokeswoman, cautions that a cookie-cutter reform package could cause more problems than it solves. “The New York Power Authority is a power company,” Hutton says. “That’s awfully different from what we do.”

It’s unlikely that she has much to fear. Talking about reform in Albany is easy. Doing it is another thing. Individual authorities such as the MTA and Canal Corp. have tweaked the practices that landed them in the headlines. But more sweeping reform of authorities isn’t likely, if only because the desire to create more of them remains such a powerful force. Steve Malanga says the situation with authorities is a lot like New York’s budget process in general. “It’s broken, but it doesn’t suit the people in power to fix it.”

Copyright © 2004, Congressional Quarterly, Inc. Reproduction in any form without the written permission of the publisher is prohibited. Governing, City & State and Governing.com are registered trademarks of Congressional Quarterly, Inc.

<Back to Top>



Modify Website

© 2000 - 2012 powered by
Doteasy Web Hosting