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Developer Donations May Be Loophole in Reform Efforts
Though Mayor Michael Bloomberg (R) has spoken in depth about contractual pay to play reform, he has so far placed little public focus on pay to play in the land use process.
“Pay to play” generally refers to the practice of awarding no-bid contracts to campaign contributors. Many good government groups have joined him in calling this an area in major need of reform in city politics.
The mayor’s office and the City Council are coordinating an effort centered on upgrading city databases, as well as examining who to include in the law and how to police the law.
“It’s easier to say let’s end pay to play than to legislate meaningful and effective reforms,” explained Dick Dadey, director of Citizen’s Union. “So much of the issues affected by city pay to play are preempted by state legislation on procurement and contracting.”
One idea being considered by city officials is to require candidates to check the donors who contribute and see if they have city contracts. This could be checked by running names through Vendex, the city’s contracting database.
The Vendex database includes those with contracts, but does not include a list of those who are seeking a contract. No database currently exists of who has land use applications pending with the city.
Advocacy groups argue that requiring the candidates to run their own checks would place a burden on the candidates, especially those running for City Council, who generally have smaller, less-financed campaign operations.
An alternate proposal would place limits that would prevent contractors from donating during the life of a contract and for a period before awarding the contract. Placing the burden on a contractor may require a change to the state’s municipal contracting law, which sets out the requirements for who receives a local contract.
Bloomberg spokesman Stu Loeser said many of the aspects of the proposed ban need to be negotiated, including a definition of who does business with the city. For land use applications, Loeser said, this will cover everyone from those seeking to install a patio or be limited to those seeking larger developments or city franchise contracts.
The office of Council Speaker Christine Quinn (D-Manhattan) referred all calls to Council Member Simcha Felder (D-Brooklyn), the chairman of the Government Operations Committee. Felder’s office said negotiations are ongoing. According to a statement, Council staff is still researching the issue, with legislation to be introduced shortly.
Real estate is the city’s biggest industry. Routinely amongst the biggest donors to city officials are developers with applications pending before the City Council, the City Planning Commission and other land use and concession agencies.
“Land use is more important than contracts,” said Gene Russianoff, staff attorney for the New York Public Interest Group.
The city’s Campaign Finance Board (CFB) has released a series of recommendations regarding the land use process and who to regulate. These include calls for a ban on contributions from firms that submit planning, zoning and landmarks applications, as well as officers and owners of those firms and professionals authorized to do business on behalf of those firms.
In addition, the CFB has proposed the city adopt a regulation governing the municipal bond industry for city contractors. The rule, adopted by the bond industry’s governing board, forbids bond firm employees from donating money to any candidate they cannot vote for, and then setting a $250 per year donation cap. Violators’ firms cannot receive bond business for two years after the donation.
Pay to play reform has been a hot topic across the Hudson in New Jersey, as officials grapple with the state’s reputation as a hotbed for political corruption. A statewide ban on contractual pay to play has already been enacted. Recently there has been a push for municipalities to adopt their own pay to play bans relating to those who redevelop city land.
In January, Jersey City’s City Council voted down the land use proposal in a heated meeting, which featured council members taking personal potshots against the councilman who proposed the ordinance.
Political consultant George Arzt sees the New York proposals going the way of the Jersey City proposal. While noting that the majority of donations do not influence a final decision, but rather give donators access to elected officials, he sees the status quo remaining.
Given how many elected officials benefit from developer donations, Arzt said, one does not need a crystal ball to foresee the fate of a reform bill.
“It won’t pass,” he said.
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