Inconvenient Truths

Cuomo Takes on Dragons,

Can He Win Submission?

Governor Cuomo kept his word and presented a state budget of $132.9 billion for Fiscal Year 2011-12, which begins April l. This figure, believe it or not, is a sharp brake on spending, the first reductions since the Pataki years. He also gave a fine speech Tuesday afternoon, with greatly improved visual aids, to make the state's financial distress evident to anyone willing to see, including the legislature.

For eight years, New York Civic has been preaching that state spending is irresponsibly high, a notion that has gradually gained acceptance even though is nothing is done about it.

On September 22, 2002, we wrote an article headlined DRIFTING FROM ERIE TOWARD ONTARIO. The geographic reference to the two Great Likes is intended to imply to readers just what happens to ships that try to drift from Lake Erie to Lake Ontario: they go over Niagara Falls, a natural wonder but a disaster for shipping. Vessels can use the multiple locks of the Welland Canal, which connect the two lakes a little over ten miles west of the Niagara River, which forms the boundary between the United States and Canada. The original canal was begun in 1824 and opened in 1829. It was subsequently widened and enlarged until 1932, when it reached its present size. Niagara Falls has occupied its present location since the end of the Wisconsin glaciation in the last Ice Age.

The point of our 2002 article, which was written when Governor Pataki was in his second (of three) terms, was that New York State was running out of money. In the intervening eight years, during the administrations of Pataki, Eliot Spitzer and David Paterson, disaster was postponed by borrowing billions of dollars in the name of various public authorities which are euphemistically referred to as 'off-budget entities'. That is an Enronian phrase that should rank with 'collateralized debt obligations' in the vocabulary of fiscal irresponsibility.

In his remarks Tuesday, the new governor also referenced Enron, once No. 7 in the S & P 500, and now a synonym for fiscal flim-flam. We have mentioned that defunct corporation eighteen times over the eight years of our editorial criticism of New York State's unsound borrowing practices and concealment of its growing deficits. Governor Cuomo said:

"When you use reality-based budgeting, as opposed to Albany-based budgeting, which is where Albany meets Enron, in our opinion, the Albany-based budgeting institutionally assumes an exorbitant growth rate that is disconnected from fiscal reality. And this has been going on for many, many years."

It is too early in the budget season, for us, anyway, to offer judgments on the individual appropriations that the governor proposes for agencies. But he is definitely inclined in the right direction. It is ironic that his message has resonated most with Republicans and Conservatives, and least with the Democratic left. That shows that the principal fault line in fiscal policy is not between the two parties, but between spenders and savers, with the Democrats evenly divided.

For those of you who are political junkies and keep box scores (which we think is completely laudable), the vote on imposing the property tax cap proposed by Governor Cuomo in his campaign was 45 to 17. The 45 consisted of all 32 Republicans and 13 Democrats. The 17 Democrats who voted against the cap were Addabbo, Avella, Diaz, Dilan, Duane, Espaillat, Hassell-Thompson, Krueger, Kruger, Montgomery, Parker, Peralta, Perkins, Rivera, Serrano, Squadron, and Stavisky.

The 13 Democrats who voted in favor of the cap were Adams, Breslin, Carlucci, Gianaris, Huntley, Kennedy, Klein, Oppenheimer, Sampson, Savino, Smith, Stewart-Cousins and Valesky. We note that the four members of the Independent Democratic Conference - Senators Jeff Klein, David Carlucci, Diane Savino and David Valesky - all supported the tax cap, voting with the Republicans, as did Senate Democratic leader John Sampson. So much for ideology, vote your district.

It has been a generation since New York had a governor of whom we could be proud. A swallow does not make a summer, but think of where we were on Groundhog Day four years ago. The new governor had already described himself as "a fucking steamroller", was preparing for the Troopergate war against Senate majority leader Joe Bruno, and was trying to impose his choice for State Comptroller, Martha Stark, on the state legislature to fill the vacancy caused by the resignation of Alan Hevesi following his first felony conviction.

The legislature chose one of its own, Assemblyman Tom DiNapoli, for the plum position. DiNapoli was a better choice than Spitzer's candidate, who was subsequently compelled to resign as City Finance Commissioner because of sundry irregularities whose details you can find with the aid of Google. DiNapoli is not as bright as Hevesi, but there are more important qualities, like decency and integrity, that high public office demands. The Comptroller is a good man, highly affable and liked by his colleagues. His industry and devotion are unquestioned. Nonetheless, it is ridiculous that he be the sole trustee of a pension fund that exceeds $120 billion. That should be corrected.

BTW, DiNapoli's new First Deputy Comptroller is Pete Grannis (park name "Reliable"), who served 32 years (1975-2007) in the Assembly and four as State Commissioner of Environmental Protection before being rudely and unceremoniously dismissed by the dying swans of the lame duck Paterson administration. When Grannis asked to see Paterson to ask why he was being fired after four years service, particularly since it was only weeks before the whole bunch would be turned out by the calendar, he was denied that opportunity.

REMEMBRANCE OF THINGS PAST

When I was Parks Commissioner, February 2 was the day of an annual ritual, consulting a groundhog who would advise what the season would bring. If the day were clear, and the groundhog saw his shadow, that meant that winter would continue for six more weeks (until mid-March). If the day were cloudy, there would be no shadow, which indicated that winter was over. In 2011, winter is not over, no matter what the groundhog indicates.

The groundhog custom is most closely associated with Punxsutawney, Pennsylvania. Its spread to New York zoos (Queens and Staten Island) was flagrantly derivative. The Borough President of Queens, Claire Shulman (park name "Queen Bee"), a good friend of parks, came to the Queens Zoo every year to open the little door behind which the animals hovered, awaiting their annual fifteen seconds of fame.

We had a difficult experience one year with Claire's predecessor, the late Borough President of Queens, Donald Manes. On a similar occasion, he saw a pair of otters climbing out a pond in the zoo, and he threw rocks at them, even when asked to stop. To me, that was as bad as all the money he extorted from parking meter operators. You can Google him, too, for a sad chapter in New York City history. Who ever heard of a great big borough president stoning an innocent family of otters?

Can't Anybody Here Play This Game?

Budget Deadlock -Day 98



Buffalonian Senator

Stachowski Objects

To Paying Sales Tax

On Cheap Clothing



The state budget - or the lack of it - is as unpleasant a subject as the heat wave, and we had hoped that by now both issues would have been resolved.

Unfortunately, the parties in Albany are still far apart. Today we are 98 days behind the legal deadline, which means the new state fiscal year, 2011, is now more than one-quarter over. During the Pataki era (1995-2006) a couple of budgets were not approved until August, but we were promised that when the governorship and both houses of the legislature come under one party (the Democrats) that issues would be settled promptly and amicably.

Though there are many disputes simmering in Albany, the current deadlock is about adopting the budget. Whatever else the executive and legislative branches are supposed to accomplish this year remains in limbo, partly because there is a lame-duck governor, partly because the Democrats have a bare majority of 32 senators, which means every one of them must vote for a bill to pass it, for if any member objects, the bill is lost. A senator may raise objections because of unrelated grievances against the leadership or concerns over other legislation.

In the current standoff, both houses have passed bills specifying appropriations. As might be expected, they differ. However, only the Assembly has passed a revenue bill, which is needed to pay for the expenditures, or at least some of them. The Senate cannot muster 32 votes to pass a tax bill because Senator William Stachowski of Buffalo will not approve any measure which does not provide increased status and authority for the State University at Buffalo. To insist on this expansion of SUNY-Buffalo, Stachowski is withholding support for an agreed upon re-instatement of the state's portion of sales tax on clothing under $110, which the Assembly and Senate are depending upon to balance the budget. The Democrats oppose the expansion of power for SUNY-Buffalo (and Stony Brook) because potentially all 64 state colleges could seek independence and operate autonomously, raising tuition at will and leaving some institutions far stronger than others. We have no idea at this time how or when this issue will be resolved.

Senator Stachowski is also reported to be displeased because, as a leading Democrat on the Finance Committee, he expected to chair the committee when the Democrats regained control of the Senate (after 43 years in the wilderness). However, that plum went to Senator Carl Kruger, who with the 'three amigos', Espada, Monserrate and Diaz, Sr., effectively controlled the organization of the DINO (Democratic in name only) senate.

In fact, it was former Majority Leader Malcolm Smith's refusal of Espada's demand for millions of state dollars to subsidize the Soundview Health Center that he and his three sons operate, that triggered the Espada-Monserrate revolt that led to Smith's unseating as majority leader and Sampson's installation as conference chair, with benefits.

Public confidence in the State Senate was not enhanced by the resulting June 8 coup, in which Senator Pedro Espada and former Senator Hiram Monserrate voted with the 30 Republicans to displace the Democratic leaders and form a new Republican majority. After a month of anarchy, Espada returned to the fold, and was rewarded with the majority leadership, formerly held by Malcolm Smith, who was kicked upstairs to president pro tempore of the senate, making him third in line to become governor, if the worst should happen.

As a by-product of this successful piracy, Richard Ravitch was appointed Lieutenant Governor by Governor Paterson and Judge Jonathan Lippman persuaded three judges on the Court of Appeals to join him in finding the appointment constitutional, although it was historically unprecedented in the 233-year history of the State of New York. Paterson now says he regrets the appointment because he feels Ravitch is too close to Speaker Silver and to establishment figures in New York City.

Much of what remains of authority in Albany is concentrated in the Assembly Speaker, who is clearly master of his own house. However, prospective governor Andrew Cuomo is already making his own judgments on issues in which the speaker may have an interest, professional or personal. The de facto Democratic senate leader, John Sampson of Brooklyn, does not have enough votes to override a governor's veto. (Silver does, but both houses must concur in order to override.)

The result so far is deadlock, which can theoretically continue until the State runs out of money. Since its finances have been so manipulated, no one can predict with certainty when that will be. But as with Bernie Madoff, the day is certain to come.



UPDATE ON THE AQUEDUCT GAMING SCANDAL:

MALAYSIAN IS LAST MAN STANDING (AS OF TODAY)

Senator Sampson was criticized last month for leaking the details of a bid, including two internal Senate documents, on the Aqueduct racino to a lobbyist (former Senator Carl Andrews) for the Aqueduct Entertainment Group (AEG), the firm that won the contract, which has since been cancelled after the State Lottery Division deemed the Aqueduct Entertainment Group to be "unlicensable". Sampson denied any wrongdoing in connection with furnishing the documents to AEG, one of whose investors was former Congressman Floyd Flake, who has since withdrawn from participation in the group.

Yesterday's Post reported, in a story by Brendan Scott, headlined "2 OF 3 AQUEDUCT BIDDERS SCRATCHED" that "Now there's only one horse in the race for the multibillion-dollar casino contract at Aqueduct Racetrack.

"The state Lottery Division yesterday abruptly tossed two of the three bids it received last week to build and run a video slots parlor at the faded Queens track, leaving only Malaysian gaming giant Genting in the running.

"The cash-strapped state is counting on the winner to pay a $300 million licensing fee.

"Lottery officials decided that the two disqualified bidders - Penn National Gaming and the powerful SL Green-Hard Rock partnership - 'did not conform with the requirements of the competition.'"

The Acqueduct situation has been a public embarrassment since Governor Paterson first attempted to award the sole-source contract to the politically wired Aqueduct Entertainment Group on January 29th. This took place close to the time that he was soliciting the support of Reverend (and former Congressman) Floyd Flake's support in his projected gubernatorial race against Attorney General Andrew Cuomo. Flake was a minor participant in AEG.

Six months later, no final decision has been made. There has been no independent review of whether the racino is a good idea, or simply a desperate attempt to pump $300 million into a chasmic state budget hole that now exceeds $9 billion.

Why would any rational person seek to govern this state at this time, unless it were the family business?



STARQUEST IN THE NEWS

"The architecture of Central Park, like the United States Constitution, must evolve with the times." StarQuest weighs in on the future of Tavern on the Green in yesterday's New York Times. Read all about it here.

StarQuest reminisces about Parks Department alum, Bradley Tusk (a.k.a. Ivory), in this week's Observer profile of Tusk entitled "Mayor Bloomberg's Secret Weapon". Click here to read the entire article.