Cuomo Manages Fallout From Corruption Scandal

Sep 29, 2016

New York Governor Andrew Cuomo is distancing himself from the corruption scandal within his administration and placing the blame on others. But some say Cuomo might be better off making some changes instead.

Governor Cuomo has made a number of public appearances across the state, continuing to promote economic development efforts, just as he did before the U.S. Attorney, Preet Bharara, charged several of his former close associates and two major real estate developers with bribery and fraud in connection with the Buffalo Billion and other projects. Cuomo spoke in Buffalo one day after the nine criminal complaints were announced, saying the programs aren’t going to stop.

“The Buffalo Billion is not about projects in the ground and nine individuals who are alleged to have done bad acts,” Cuomo said.

He’s said he’s personally saddened by the alleged corruption by longtime Cuomo family friend Joe Percoco, but does not believe Percoco’s acts have any larger bearing on his administration.

The governor is also laying blame on the State University System and its board of directors. Technically, they have oversight over SUNY Polytechnic, where Alain Kaloyeros, also charged with corruption, awarded all of the major contracts for the Buffalo Billion and other projects.

Cuomo was asked by a reporter in Skaneateles, where the governor was making another economic development announcement, how Cuomo could not have known what was going on “right under his nose.”

“I read the complaint form the U.S. Attorney, and I had no idea that any of that was going on,” said Cuomo.

The governor said he does not mean to sound  “defensive,” but he says it all occurred through SUNY’s procurement system.

“I appoint people to the State University board, but it’s not in my office, quote, unquote,” Cuomo said.

Cuomo says he’s already transferred all authority for contracts to his own Empire State Development authority, and will announce reforms in his State of the State message in January.

And he says all campaign donations from the two developers will be held in escrow until the criminal cases are concluded, in case a judge orders any forfeiture of funds from the companies.  

Critics of the governor’s economic development programs say there’s more that he can do to get out from under the scandal. Former Assemblyman Richard Brodsky chaired a key oversight committee that looked at state economic development projects and reformed questionable practices in previous administrations. He says there’s little evidence that Cuomo’s signature economic development programs have led to a better economy overall, and the governor should find a new direction, instead.

“What I’d say is, change course,” Brodsky said.

Brodsky says there are alternative ways to boost the economy that work better, like investing in infrastructure, and education.

“If he insists on maintaining these kinds of policies, more and more the evidence will show they’re not working,” Brodsky said. “And he will be forced, politically, to  defend the indefensible.”

EJ McMahon, with the fiscal watchdog group the Empire Center, say there might be some positive political fall out, if the attention on the criminal charges cause New Yorkers to look more closely at some of the big projects now financed with public dollars, like the three quarters of a billion dollar subsidy to the Solar City factory in Buffalo, run by Tesla chair Elon Musk.

“I would hope the public would ask, ‘hey wait a minute, why are you spending all this money’,” McMahon said. “ ‘To build a factory for a billionaire’?’”

McMahon says if Solar City, which is in shaky financial condition, goes bust, taxpayers will own the factory.

Brodsky says Cuomo has pivoted before on an issue.

He says Cuomo was initially skeptical of raising the minimum wage to $15, but later led a bus tour and successfully campaign to convince even Republicans in the legislature to pass it.

But the governor does not appear to be shifting direction any time soon.  He announced what he called a major step forward for the rebuilding of Penn station in New York City, saying his projects restore a spirit of confidence and energy.

“Don’t tell me we can’t do it,” the governor said, his voicing rising. “We’ve done this, and much, much more. And that is the blood in our veins and the DNA in our cells.”

Cuomo says it’s his mission to “make things happen.”