Blair Horner: Governor Pushes Ethics Reform, Again
As the election staggers across the finish line, the question for New Yorkers is what next? At the state level, Governor Cuomo weighed in to support legislative candidates who embraced his agenda. The governor went so as far as to circulate a questionnaire to candidates quizzing them on their support for ethics law changes, asking their position on limiting lawmakers’ outside income and stricter campaign contribution requirements for Limited Liability Companies (LLCs).
Urging reforms in those two areas are mightily important. The loophole that allows those controlling Limited Liability Companies to donate essentially unlimited amounts of campaign contributions is an example of the loophole that swallows the law.
That loophole is based on a decision by the New York State Board of Elections – there is nothing on the law on this – that says that LLCs should be treated differently from other companies and allowed contribution limits that far exceed those for corporations. Corporations, for example, are limited to no more than $5,000 annually in campaign contributions. LLCs each can donate as much as $60,000 for candidates for governor and more to other candidates. For them, essentially the sky is the limit.
Real estate developers in particular, have used the LLC loophole to donate enormous sums. The network of LLCs controlled by real estate tycoon Leonard Litwin (who controls scores of LLCs) has admitted to contributing over $10 million in this way.
Given that LLCs have become the “honey pot” of campaign contributions for elected officials, they are also found at the heart of some of the state’s most recent political scandals. In the cases that led to the convictions of the former Senate Majority Leader and the former Assembly Speaker, LLCs were used to enrich both men and their families.
Allowing lawmakers to “moonlight” – have jobs outside of their legislative ones also can create temptations for officials to trade on their public offices to enrich themselves personally. Again, in both cases of the former legislative leaders, the corruption conviction stemmed from their efforts to use their public offices for personal gain.
But the needed ethics reforms go beyond merely closing the LLC loophole and limiting outside income for lawmakers. The allegations and convictions of corruption in state government are so widespread that additional reforms are needed.
The investigation into apparent misconduct by top aides to the governor and his close allies underscore the need for real changes in the way the state’s contracts are awarded – bringing much greater openness and accountability to state contracting is a must.
The investigations into the state’s contracting also identified allegations of a “pay-to-play” system in which government contracts were allegedly awarded to big campaign donors. As a candidate for governor, Andrew Cuomo advanced a proposal to place new, strict, and lower campaign contribution limits on those seeking and receiving government contracts.
Since becoming governor, however, little has been done to advance that plan.
Also, all of these investigations were brought by federal prosecutors, not state ethics watchdogs. It is clear that overhaul of these entities must be part of a reform agenda.
The state’s leading ethics watchdogs for the executive branch, lobbying, the legislative branch, and campaign finance system are far too beholden to the political elites that run the state. Truly independent watchdogs are needed. And these agencies must be directed by individuals who are empowered and protected to enforce the law without fear or favor.
To clean up the mess of unprecedented corruption that has, sadly, become the hallmark of New York State government, Governor Cuomo needs a comprehensive approach and use all of the tools he’s been given to boost ethical standards and public confidence.
In 2010, then-candidate Cuomo launched his campaign for governor on the steps of the Tweed Courthouse, pledging to reform Albany. Since then he has talked grandly, but has simply not accomplished enough.
New Yorkers have heard enough talk about reform, now is the time to actually deliver on it.
Blair Horner is the Legislative Director of the New York Public Interest Research Group.
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