RICHIE KESSEL:  POSTER BOY FOR ETHICS REFORM

One day when historians of New York State look back on the 20th century, they may debate who was the most and least effective Governors, most corrupt legislator and best Senate Majority Leader and shrewdest Assembly Speaker.  But it is likely there will be little debate as to the most investigated State official in the last 30 years:  Richie Kessel. To give Kessel’s legacy its due, let’s recognize that Kessel has been investigated during the Pataki, Spitzer, Paterson and Cuomo Administrations.

Whether at LIPA or NYPA, the one constant has been investigations of Kessel.  Even now as his inglorious career lurches to its long overdue denouement, Kessel is being investigated simultaneously for potentially unethical behavior at two separate State authorities.  Street Corner Conservative believes this achievement is unprecedented in the history of the Empire State.  Indeed, it is possible that when Kessel takes his leave of State service he will remain under investigation by the Cuomo Administration Inspector General for his actions at two separate authorities in two decades.

Lest future generations not recognize Kessel’s lifetime achievements in ethical investigations, Street Corner points out that Kessel was previously investigated by a Democratic Comptroller for his actions at LIPA and received well-deserved criticism for bypassing its own bidding requirements when it paid a Republican consulting firm $45 thousand to conduct “political polls.”  Later, he was investigated by the Inspector General in the Paterson Administration.

Since Kessel partisans may claim their benefactor was a victim of partisan politics, it is critical to note that each of the four investigations was undertaken by a Democratic official.

While the State Legislature considers the Governor’s much needed ethics reform bill in the closing days of this legislative session, I call upon the NYPA board to investigate promptly the following Kessel issues:

1)  whether at Kessel’s direction health insurance was improperly provided to a NYPA trustee;

2)  whether Kessel improperly sole sourced any of the scores of such contracts;

3)  whether donations to Long Island organizations of hundreds of thousands of dollars were improper because they were unrelated to NYPA’s mission; and

4)  whether Kessel violated any State laws, including the various public authority reform acts, regulations and NYPA policies.

AN OPEN LETTER TO NEW YORK POWER AUTHORITY TRUSTEES

Street Corner Conservative respectfully requests that the NYPA Board of Trustees review the following issues relating to what appears to be abuse of State FOIL law based on much delayed and recently released FOIL request information:

1)  Showing Love to Long Island entities. In January, 2011—five months after the request, the NYPA Corporate Secretary responded to a August 22, 2010 FOIL requesting among other items, “information and records as to contributions and payments to not-for-profit entities from NYPA or any subsidiary or affiliate including purchase of tickets or sponsorships to events conducted by any such not-for-profit for the period January 1, 2009 through and including July 31, 2010.”

The recipient list certified by the Corporate Secretary included approximately 187 not-for-profit entities with contributions totaling approximately $808,289.  A significant number of recipients were Long Island entities including Mr. Kessel’s hometown Merrick Chamber of Commerce and the neighboring Bellmore Chamber of Commerce.

On April 18, 2011, in response to FOIL requests dated February 20, 2011 and April 3, 2011, the NYPA Corporate Secretary, included a revised list of contributions for the period January 1, 2009-July 31, 2010.

The revised list contained the following contributions not listed on the original list released in January, 2011: 

Research Foundation of SUNY Stony Brook

$500,000

Stony Brook Foundation

50,000

N.Y.S. Energy Research & Development Authority

486,124

 The revised contributions for the period January 1, 2009-July 31, 2010 totaled $1,844,413.  Of the amounts omitted from the prior list, at least half and perhaps 100% went to Long Island recipients.  Why?

• Who is responsible for the omissions?  Was that person ordered by the NYPA CEO or members of his cohort to violate the law and suppress information embarrassing to the NYPA CEO?
• Was any staff memo ordered to omit the contributions?  If so, who gave the order?
• Should the deliberate withholding of information from a FOIL request, a violation of State law, be ignored?
• If there are violations, will proper authorities be notified?
• Were the three omitted contributions totaling $1,036,124 approved by the board?  Were the hundreds of thousands of dollars of other donations approved by the board?
• If not, should they have been approved by the board?
• What was the purpose of the $486,124 contribution to the N.Y.S. Energy Research Development Authority?  Was it a vehicle to fund additional money to Long Island entities favored by the CEO?
• The Long Island Pine Barrens, which honored Mr. Kessel and Governor Paterson at their 2010 gala dinner, received from NYPA $29,850 in contribution/grants.  Because Mr. Kessel was honored, was this an appropriate gift?  Did the board approve this gift?  Was it an appropriate use of public money for NYPA to pay the Pine Barrens entity tens of thousands of dollars for Kessel to appear on public access TV programs unwatched by millions of people and to appear in the Pine Barrens newsletter?  Is such an expenditure of money consistent with NYPA’s marketing plan?
• According to NYPA FOIL released contribution lists covering the period January 1, 2009 to March 31, 2011, NYPA contributions/grants to not-for-profits totaled approximately $2,271,000.  Contributions to Nassau and Suffolk County not-for-profits totaled $663,931 or 29% of total gifts.  If the NYPA grant to NYS Energy Research and Dev. Authority of $486,124 is added to Long Island’s gift list, total contributions for the period would be $1,150,055 or 50.6% of total NYPA gifts.
• Since NYPA’s total portion of electrical power generated on Long Island is less than 5%, what is the possible business justification for NYPA allocating anywhere from 29% to 50% of its not-for-profits contributions to Long Island?  Is it fair for upstate ratepayers to contribute to Long Island not-for-profits favored by the CEO?
• Was the board aware of the amount of contributions to Long Island not-for-profits?  If so, did the board approve these contributions?
• There are numerous dubious contributions that appear to be unrelated to NYPA’s mission (i.e., West Side Cultural Center – $10,000).  Why were these dubious contributions permitted?

2)  Health Insurance. Did Kessel violate State law as set forth in letters from at least two Attorneys General of the State?  The response to the FOIL request released on April 18, 2011 suggests that a former NYPA trustee did receive free health care benefits paid for by NYPA.  According to the Attorney General, it is illegal to give health care benefits to N.Y. Agency board members.  Who authorized the NYPA trustee to receive this illegal benefit?  Has the Inspector General’s office been notified of this violation?

I appreciate your consideration of these serious matters. I understand how unpleasant it must be to spend your time cleaning up the mess left by your soon to be former CEO.