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Charter Revision Commission Urged to Consider Tighter Donation Rules for City-Affiliated Nonprofits


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Mayor de Blasio & the Mayor's Fund (photo: Edwin J. Torres/Mayoral Photo Office)


A government reform group is urging Mayor Bill de Blasio’s Charter Revision Commission to explore stronger restrictions on donations to nonprofits affiliated with city agencies, building on a raft of laws passed through the New York City Council and signed by the mayor in 2016, which are set to go into effect next year.

Reinvent Albany, an organization focused on government transparency and accountability, is advocating for greater disclosure requirements and lower limits for donations made to city-affiliated nonprofits by entities and individuals who have contracts and other business with the city and appear on its “doing business” database. One of the most prominent examples of a city nonprofit is the Mayor’s Fund to Advance New York City, which carries out programming through public-private partnerships and raises millions in private funding to do so every year, and is currently chaired by de Blasio’s wife, First Lady Chirlane McCray.

Reinvent Albany will present its recommendations at a public hearing of the mayor’s Charter Revision Commission in Queens on Thursday.

The recommendations are an outgrowth of controversy involving several top elected officials and organizations, most recently in de Blasio’s first term, when he formed a nonprofit called the Campaign for One New York to help promote his political agenda, particularly his push for universal pre-kindergarten and a tax increase to fund it. The group accepted large donations from many wealthy donors and special interests, including labor unions and real estate developers, many of whom had business with the city and had also been backers of the mayor’s electoral campaign. At the time, electoral campaigns were far more restricted in donations they could accept from entities with city business -- no such limits applied to elected official-affiliated nonprofits.

Though it wasn’t required, the mayor disclosed the group’s donors voluntarily every six months. But, the entire scheme invited criticism, and its efforts helped trigger a federal investigation of the mayor and his associates. The investigation eventually closed without charges being filed, but de Blasio and his team were criticized by federal prosecutors as well as the city’s Campaign Finance Board.

In response, the City Council passed a bill to rein in donations to nonprofits affiliated with elected officials, bringing “doing business” donation limits in line with those that apply to electoral campaigns -- just $400 for mayoral candidates -- and putting those nonprofits under the jurisdiction of the Conflicts of Interest Board. In 2019, the COIB will start to issue detailed reports of such nonprofits, including their donors and how much they contributed. The bill, spearheaded by then-Council Speaker Melissa Mark-Viverito, was signed by de Blasio, who called it the right thing to do despite claiming he had done nothing illegal or unethical with the Campaign for One New York.

But the new rules do not cover nonprofits affiliated with city agencies, which, Reinvent Albany points out, number in the hundreds and currently have no “doing business” restrictions.

“We’re increasingly concerned about nonprofits that have existed for years affiliated with city agencies, and donors giving to these nonprofits and having business with those same city agencies,” said Alex Camarda, Reinvent Albany’s senior policy advisor, in a phone interview. The lack of regulation could create the “perception of undue influence, if not actual conflict,” he said. With the mayor having formed a Charter Revision Commission with the express mandate to look at campaign finance reform, the issue appears to be right up the commission’s alley, if not necessarily something de Blasio had in mind.

To close several holes, Reinvent Albany recommends that all donations to nonprofits affiliated with elected officials be capped. The law currently only applies the $400 doing-business cap to those nonprofits that spend more than 10 percent of their budget on public-facing communications featuring the elected official. Camarda said the limit could be higher, though he did not suggest a specific amount.

Further, as Camarda mentioned, the group is calling for expanding donation restrictions to all city agencies, public benefit corporations, public authorities, and local development corporations. “A company that does business with the city could give millions” toward a city agency under the current law, Camarda said. “That’s where we feel the [Council’s law] doesn’t go far enough.

The COIB requires that agencies report any private donations above $5,000 made either to the agency or to an affiliated nonprofit. Those donations are reported in broad ranges that obscure how much an agency has received. For instance, The Fund for Public Schools, a nonprofit tied to the Department of Education, reported more than $4 million in donations from May through September 2017, per the latest disclosures available, including exact donations though it was not required. Reinvent Albany is also pushing for disclosure of all donations in their exact amounts, and on the city’s Open Data portal to allow for easy data analysis.

Finally, the group is calling for the city’s ethics laws to apply to volunteers who are involved in major policy work and senior appointments and that are also fundraising for nonprofits affiliated with electeds. Though their testimony does not say so, the recommendation clearly alludes to First Lady McCray, who has played an increasingly prominent role in de Blasio’s administration, appearing with the mayor at major personnel announcements and continuing to roll out aspects of her main policy and program initiatives. In late 2016, amid investigations into the mayor’s administration, Politico New York reported that the Mayor’s Fund to Advance New York City was more thoroughly vetting donors to avoid potential conflicts. McCray recently told Gotham Gazette and City Limits that she does not worry much about conflicts given that lawyers handle those issues. The Fund provides assistance for programs at 30 city agencies and has played a prominent role in the administration’s ThriveNYC mental health initiative, which was spearheaded by McCray.

“We do not oppose per diem or unpaid volunteers serving on city boards, task forces and commissions, much like the members of this commission,” the Reinvent Albany testimony reads. “But they should not also be fundraising simultaneously for nonprofits affiliated with elected officials.”

The group acknowledged that there were nonetheless nonprofit organizations that may not be covered by any changes they recommend, such as organizations that receive large sums in city funding and whose board members are donors to city elected officials.

“Many of these nonprofits do important work that helps the city,” Camarda said. “We don’t want them to become avenues for companies and wealthy donors to circumvent the campaign finance system.”

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by Samar Khurshid, senior reporter, Gotham Gazette
     

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Eric Adams Previews Vision for Becoming City’s CEO


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Brooklyn Borough President Eric Adams (photo: @bpericadams)


“I’m working towards City Hall,” Brooklyn Borough President Eric Adams said on Tuesday, explaining during a wide-ranging interview that he has begun planning his run for mayor.

It’s no secret that Adams, 57, who was elected borough president in 2013 and reelected last year, wants to succeed Mayor Bill de Blasio, a fellow Democrat who will be term-limited out of office at the end of 2021 -- he has made that clear for years. But on Tuesday, during an appearance on the Max & Murphy podcast from Gotham Gazette and City Limits, Adams for the first time publicly offered insight into his vision for running the city and what part of his campaign pitch will be.

“What we’ve been able to do here in Brooklyn, and my perception of where I believe the city needs to go, I think it’s different from all the candidates who are running and thinking about running,” he said, sitting in the vast conference room of Brooklyn Borough Hall.         

That difference comes in part from Adams’ background in policing. For 22 years, the borough president was a member of the NYPD. In the early 1990s, he said on Tuesday, he was active in developing the management system CompStat under Police Commissioner Bill Bratton — a system that has been credited for helping to drastically reduce crime and, according to Adams, “changed the culture of policing not only for New York but for the rest of America.”

“When the police department made this change, every agency should have followed,” Adams said, pivoting toward his vision for managing the city’s immense bureaucracy and dozens of agencies. “We have enough money, the right agencies, and the right people in place, but the systems are broken.”

A CompStat approach across all agencies, Adams said, would include technology to inspect and track progress in “real time.” “I’m going to professionalize our agencies so...we can start seeing our results not yearly, but daily. CompStat would be a model that would be used in every agency.”

CompStat is known for its data-driven approach and tough culture of accountability on NYPD leaders, such as precinct commanders. “Commissioner Bratton came in and said, ‘We have to change the culture’, and he had to move people out of the way who couldn’t understand that change,” Adams said, adding there must be clear goals that relevant agencies are working together to achieve, efforts that today are too disjointed.

Adams is typically supportive of de Blasio — even applauding the mayor during the podcast for “doing a good job” in improving access to after-school care and reducing both the use of stop-and-frisk policing as well as crime, among other positives he cited. But the borough president also noted problems with education, healthcare, police accountability, and affordability in the city, saying: “when you look at it, either we’re going downwards or we’re flat-lining, we don’t see any improvements.”

Using the example of unemployment (which was at a near-record low of 4.2 percent in March 2018, down from 8.3 percent when de Blasio first took office in January 2014) Adams said government agencies must work together more coherently.

“I want to create a clear mission for the city that means every agency, although they have their individual portion of the mission, they should be all moving towards that vision. If the goal is to improve unemployment numbers, then we cannot have agencies that are in the way of allowing companies to open and do business in the city,” he said.

“Yes, your mission might be to ensure buildings are safe, but that mission should also feed into the overall mission of the city. It should not take a year to grant a building permit.”

Though there’s a ways to go until Adams presents voters his promises ahead of the 2021 mayoral election -- where he is expected to face Public Advocate Letitia James, Comptroller Scott Stringer, Bronx Borough President Ruben Diaz, Jr., and possibly others in the Democratic primary -- the Brooklyn borough president is clearly thinking about how he will make his pitch and what would separate him from the crowd.

During the podcast, Adams touched on other aspects of current policy debates that may come into play during a future campaign, but are already playing out now.

Most notably, Adams said he wants to examine whether the city should “tear down” and rebuild public housing developments. With crises plaguing the New York City Housing Authority (NYCHA) and many billions of dollars in infrastructure needs across its portfolio, Adams said the “only way to change the problem narrative is to think outside of the box.”

“We’re asking Office of Management and Budget (OMB) to do a real analysis of repairs and the cost of going in and doing these repairs,” he said. “We need to have a conversation: do we tear down NYCHA and rebuild it at the quality level it needs to be?”

“I say we must be committed to zero displacement: the current tenants are guaranteed to remain there,” he continued. “But there are old pipes, old roofs, and old wiring. What is it going to cost us to make NYCHA housing sustainable for the future?”

Adams is also critical of politicians who treat NYCHA like a pony show to garner media attention and boost voter confidence, making apparent reference to Governor Andrew Cuomo’s recent interest in public housing. Adams recently stepped further into the politics surrounding NYCHA by inviting Cuomo’s Democratic primary opponent in this year’s election to tour NYCHA with him -- an offer Cynthia Nixon quickly took him up on, touring Albany Houses in Crown Heights with the borough president.

Adams said the way some politicians treat NYCHA has created an “angry and distrustful” community of residents who are living in such impoverished conditions “they’ve given up.”

“Folks have finally discovered there is a NYCHA and they’re walking through it, I don’t know where they’ve been all these years, the NYCHA problem did not start now,” Adams said.

During the conversation with Gotham Gazette and City Limits, Adams also touched on other areas where he wants to usher in change.

A top priority for Adams is campaign finance reform, with the borough president saying the current system means candidates are spending more time in affluent areas, away from where they need to be.

“There is no reason we shouldn’t have a public-funded system,” he said. “People are not going to NYCHA or South Bronx or South Jamaica, Queens. They are going to affluent zip codes and focusing on finding donors in those areas.”

At the moment, the city’s public financing program matches contributions up to $175 from locals at a six-to-one rate, with several requisite thresholds. As Adams puts it: “If I live in an affluent area, I don’t care what amount you lower [the donation limit to] it’s easier for me to call a hundred friends and say, ‘Hey, on your way to The Hamptons can you get 1,000 of your friends to donate $175?’ I can’t call someone from the Pink House and say, ‘Hey, you’re on your way to Coney Island Beach, can you give $175?’ It’s not going to happen.”

“The number of calls you make to raise money is taking away from the quality time you should be spending doing your job,” he said. Adams wants a fully public system, whereby candidates don’t have to raise private money. He said that he wants an upcoming City Charter Revision Commission, on which he will have one of 15 appointees, to pursue such a change.

That commission -- organized through City Council legislation at the behest of Public Advocate James, Manhattan Borough President Gale Brewer, and City Council Speaker Corey Johnson (himself another possible 2021 mayoral candidate) -- will soon be formed, working toward proposals for the 2018 general election ballot. Mayor de Blasio has already formed his own Charter Revision Commission that just began its work, with a mandate to look closely at campaign finance reform.

Adams is also particularly concerned with public health. He believes city schools shouldn’t be feeding students processed meat, and he regularly references the World Health Organization’s 2015 report that found “processed meat is carcinogenic to humans” — meaning it causes cancer.

His concern for public health is personal, too. Adams completely changed his lifestyle upon receiving a Type Two Diabetes diagnosis in 2016. By changing his diet to vegan and increasing his exercise regimen, Adams’ blood sugar levels had returned to normal six months on from the diagnosis and he says he completely reversed the disease.

“We are so dysfunctional as a city when you stop to think about it,” he said. “We have a schizophrenic healthcare philosophy. In one area we say that childhood obesity is an issue, asthma is an issue, yet we feed the children food that cause the diseases. There’s a disconnect.”

These are just a few of the issues that are central to Adams’ work now, and could be central to his mayoral campaign.

Yet before the 2021 city elections, there is the 2018 New York gubernatorial race and Adams is giving no indication of the candidate he’s planning to endorse in the Democratic primary, choosing between Cuomo, who he’s “disappointed in,” and Nixon (at least one other name is likely to be on the ballot, perennial candidate Randy Credico).

“I have not kept it a secret that I’m extremely disappointed in the treatment of Brooklyn in comparison to other boroughs, particularly the Bronx,” Adams said when asked about Cuomo, who has a long, close relationship with Diaz, Jr. “We’re looking at all the candidates to determine which way we’re going to go.”

“I think the primaries allow us to hear the voices of those who are running. It’s going to an exciting time,” Adams said. He also spoke about possibly backing Brooklyn City Council Member Jumaane Williams, who is running for Lieutenant Governor in the primary against incumbent Kathy Hochul and Adams knows well.

Also on the podcast, Adams spoke about plans for redevelopment in Brooklyn; his reaction to the April shooting of Brooklyn resident Saheed Vassell by police; the mayor’s recent budget proposal; and de Blasio’s record more broadly.

Listen to Eric Adams on the Max & Murphy podcast here, or find it wherever you get your podcasts.

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by Caitlin Bishop, Gotham Gazette
@caitybishop  @GothamGazette

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City Council Takes Harder Line on Mid-Year Budget Modifications


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Speaker Johnson, center, CM Dromm, and Finance Director McKinney, background (photo: Emil Cohen/City Council)


Last month, before the New York City Council issued its budget demands for next fiscal year to Mayor Bill de Blasio and before the mayor eventually ignored nearly all of them in his Executive Budget plan, the Council called in administration budget officials to testify on a modification to the current year’s budget.

In past years, budget modifications have been subject to the same perfunctory hearing. Budget officials present a quick overview of proposed mid-year changes in spending and revenue estimates, and the Council briefly reviews and approves them, allowing the administration to divert additional resources to agencies that need them and to cut back in other areas. More often than not, the modification is presented to the Council as a fait accompli.

This year, City Council Speaker Corey Johnson and finance committee chair Council Member Daniel Dromm took a different tack. Officials from the Office of Management and Budget sat as several Council members took them to task, critiquing everything from the substantial uptick in spending on homelessness to their consistently low projections of the city’s revenues. And instead of voting on the modification there and then, the Council held another hearing the next day to approve it, with no changes.

What seemed to be mostly a performative power play, however, was a preview of things to come. In the vein of increased independence from the administration and a refusal to rubberstamp the mayor’s budget dictates, the Council speaker made clear he was establishing a new status quo.

Going forward, a spokesperson for Johnson explained, the Council will take a stronger stance on proposed budget modifications, pressing the administration ahead of time on anticipated and proposed changes to see if the Council should even move forward with receiving a modification request. Hearings on budget modifications will no longer be cursory, the spokesperson said, and the administration will have to work harder to justify requests.

"This is about budget transparency, which is what I promised before becoming speaker and which remains a priority,” Johnson said in a statement to Gotham Gazette. “This is taxpayer money, and it’s important that we know as much as possible so we can make the right decisions when it comes to funding, and so we can keep the public informed.”

The new approach comes as the administration and Council are amid negotiations on the budget for the next fiscal year, which begins July 1, with the Council pushing harder for cuts to spending, increased reserves, and more transparency by way of adding additional units of appropriation to break up large lump-sum pots of money. “The Council has made its position clear. More units of appropriation will help us make more informed decisions when it comes to funding, and will give the public the ability to see where their money is going,” Johnson said in a separate statement.

Freddi Goldstein, a mayoral spokesperson on budget matters, noted that the administration gives the Council enough time to review the budget modifications, which usually accompany the preliminary budget for the next fiscal year. The most significant budget modification takes place in November, four months into the fiscal year. The budget itself is subject to weeks of hearings where the Council hears testimony from budget officials and agency heads, affording them the opportunity to examine modifications as well.

“OMB is focused on transparency, which is why we already provide the City Council with any budget modifications with ample time for review and have always welcomed any and all questions the Council may have,” Goldstein said in an email.

Last week, in presenting his $89 billion Executive Budget proposal, de Blasio also insisted that negotiations with the Council have been “collegial and productive” and that the administration was working on adding the transparency that the Council has requested. “We’re going to work with the Council,” he said, when Gotham Gazette inquired about units of appropriation being added to the budget, though indicating none had been added in this new round of updates. “We have, over the years, been adding. We’re open to adding more. That’s an ongoing discussion, which we’ve had again today with the Council. Stay tuned.”

For budget watchdogs, the Council’s new strategy is promising, if not limited.

“It’s clear the Council is trying to assert itself in budgeting,” said Maria Doulis, vice president of Citizens Budget Commission, an independent fiscal watchdog. “But nothing they do is going to change the fact that it is an executive-centered budget process. It’s driven by the mayor.”

Indeed, since de Blasio took office, the budget has steadily risen by billions each year. The Council has repeatedly called for more agency efficiencies and savings but has largely capitulated as they also advocate for funding their own priorities worth hundreds of millions, which is happening again this year, highlighted by Johnson’s push for both Metrocard subsidies for low-income New Yorkers and property tax rebates for middle-class homeowners (while de Blasio has been resistant to both).

“It’s good that the Council wants to increase its scrutiny of the budget,” Doulis added. “But it should remain focused on the big picture issues and topics that affect the long-term fiscal health of the city.”

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by Samar Khurshid, senior reporter, Gotham Gazette
     

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