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Archive for June 2015
News stories on George Marlin’s new book “Christian Persecutions in the Middle East: A 21st Century Tragedy”June 30, 2015
The following appears in the June 12-18, 2015 issue of the Long Island Business News:
When Gov. Mario Cuomo resided in the governor’s mansion (1983-1994) he was criticized by good government groups for shamelessly spending millions on advertising promoting New York and himself. These groups rightfully complained that the ad campaign did little to create jobs and was merely a way for the governor to hype himself without dipping into his campaign treasure chest.
Gov. George Pataki, in his successful 1994 campaign against Cuomo, condemned that media practice and solemnly pledged he would never permit such wasteful spending. However, like so many of his campaign promises, it was soon violated.
Pataki spent tens of millions of dollars appearing on “I Love New York” commercials. An audit by the state comptroller’s office, released in January 2002, confirmed that in 2001 alone the administration expended $55 million to boost Pataki.
Not to be outdone, Gov. Andrew Cuomo, during his first term in office, OK’d a record-breaking $211 million advertising contract to promote economic development and tourism.
The Empire State Development Corp. – an agency under the thumb of the governor – hired BBDO USA for $50 million in December 2011. The contract was amended four times for a total of $211 million, with $36.5 million spent on storm recovery assistance in reaction to Hurricane Sandy. ESDC had the discretion to spend the remaining $175 million to advertise Start-Up New York, tourism, Taste New York and Masterbrand. The largest chunk of money was expended during a gubernatorial election cycle. No doubt: a coincidence.
An audit of the program released by state Comptroller Tom DiNapoli in May reveals that the $211 million spent on the ad campaign was a waste of taxpayer dollars because it had no tangible results.
“When government spends hundreds of millions of taxpayer dollars to send a message that New York is a place to visit and open for business, it should have clear objectives and show the public actual results,” DiNapoli said. “ESDC’s attempts to measure the results of this advertising campaign were weak at best, leaving real questions about whether the results justify the cost.”
It’s been known for some months that Start-Up New York, a tax-free incentive program for business ventures affiliated with state college campuses that commenced in October 2013, had only generated 78 jobs by the end of 2014. However, the DiNapoli report does give the public more data on the project – most of it distressing.
Between October 2013 and October 2014, ESDC received 18,203 applications to join the very limited tax-free Start-Up New York program, but only 10 percent were eligible and, out of that pool, only 41 actually enrolled. Although those businesses hope to create 1,750 jobs in the next five years, people should not start rushing to fill out job applications. Similar state programs in the past (for example, tax-free Empire Enterprise Zones) have never come close to achieving employment projections.
While ESDC boasted its marketing efforts were a success, it was unable to provide any analysis to prove its claims. Worse yet, the organization could not explain why it spent more money on advertising Start-Up New York “even as applications fell from a peak of 5,300 in January 2014 to about 500 in June 2014.”
Targeted tax-free incentive programs generally fail – and it appears this latest version will not be an exception. Big Brother-type government bureaucrats should be the last persons to dictate where entrepreneurs should locate and risk their investment dollars. Instead of squandering $211 million on ads, a statewide tax break for struggling small businesses of that amount would have had a greater impact.
Genuine incentives – tax cuts and regulatory reforms – create lasting middle-class jobs. That’s the model employed in Texas and explains why it is rated the No. 1 state for best business environment.
Cuomo’s small-ball incentives explain why New York places 49th.
This article I wrote appeared in the New York Post on June 13, 2015.
The following appears in the May 29-June 4, 2015 issue of the Long Island Business News:
Since Sen. Dean Skelos and his son were arrested by the feds on May 4, the pols at Mineola’s county courthouse have been scurrying around, looking for cover.
Nassau’s political class is in a panic because members are concerned their phone conversations may have been tapped or that a colleague may have been wired when discussing pending county contracts.
What really jarred nerves was the paragraph in the complaint against Skelos describing his conversation with County Executive Ed Mangano after attending the wake of a murdered NYPD police officer.
It reads: “…while walking together outside the wake, Dean Skelos asked the Nassau County executive and the chief deputy Nassau County executive about the status of payments to the Environmental Technology Company. After consulting by telephone with another Nassau County official, the chief deputy Nassau County executive informed Dean Skelos that the payments would be made and took steps to expedite the payments due to Dean Skelos’ official position.”
People are asking, was Mangano wired? Did he give up this information in a deposition? Or, was there a surveillance truck focused on them?
Whatever the explanation, Nassau pols are worried additional damaging evidence could be in the hands of the U.S. attorney.
While investigations into Nassau’s procurement practices may be small potatoes for the U.S. attorney, they are not for the district attorney’s office. The top two contracts acting D.A. Madeline Singas should focus on are the turf field deal and the sewer lease proposal.
The heavy push to get the artificial turf deal done prior to the Skelos blowup should raise eyebrows because it’s expensive, it’s illogically timed during a fiscal crisis, it costs more than it brings in and it has previously been “gamed” around Nassau Interim Finance Authority’s contract rejection of an earlier attempt. Yet it is a single-minded focus of a county with other significant issues to address. So what exactly is in it, and for whom? And, was the “free” material provided on earlier fields paid for with federal funds or other contracts with these vendors?
The sewer lease deal will generate millions in fees for lawyers, lobbyists, investment bankers and financiers, but cost the county exorbitant “interest,” perhaps in the form of vastly increased water and sewer fees. At the same time that proposed rules would show who lobbied, who benefits and the like, the sewer lease deal hasn’t been heard of since current events broke. Perhaps because the answers to those questions would be either uncomfortable or, along with the transcripts of any related discussions heard or overheard, eerily reminiscent of what we’ve been reading lately in the text of criminal complaints.
Then there’s the NIFA board on which I served from 2010 to 2014. For the fourth meeting in a row, NIFA has turned down borrowing for judgments. Perhaps NIFA is finally out of the business of enabling that particular financial and fiscal mistake. Are board members annoyed with the county’s lack of progress, realizing the errors of their ways in 2014, or feeling the heat of public scrutiny that comes with doing a favor for a political patron?
NIFA comes under the state’s Public Authorities 2009 Reform Act, which requires board members, as fiduciaries, to act independently of elected officials and to give a “contemporaneous record” to NIFA officials of “any conversation in person or by telephonic or other remote means, or corresponding between any lobbyist engaged in the act of lobbying….”
Here are a few questions the D.A. should ask:
Did any NIFA members receive marching orders from a member of the governor’s staff?
Did NIFA members properly report meetings with lobbyists who attempt to influence any determination “by a public official…related to a government procurement”?
If NIFA members dined with lobbyists in a restaurant or a township-owned club (for example, Frank’s Steak House or Harbor Links), did they pay their fair share for the meal and adult refreshments and not a nominal amount?
If D.A. Singas, who boasts she is a “career prosecutor who brings a commitment to justice, compassion and integrity” to her job, wants to prove her mettle, she’ll not hesitate to investigate Nassau’s broken procurement process and expose any pay-to-play shenanigans.