On December 8th, after two years spent fighting the New York Times, Mayor Bill de Blasio was finally forced by the State Court of Appeals to release two confidential letters he tried to keep hidden. The contents provide hard evidence for what many have speculated about for years: He knowingly engaged in “pay-to-play” activity.
The letters, sent to the Mayor by the City’s Conflicts of Interest Board, concern his fundraising non-profit Campaign for One New York (CONY). Established in December 2013 after he was first elected to office, CONY’s mission was to push Mr. de Blasio’s pre-K education and affordable housing agenda. Before being disbanded in March 2016, it raised over $4 million. But, because the Mayor didn’t dissolve CONY at the start of his administration, the perception grew that CONY was actually his “slush fund.” At the time, both the New York Post and Daily News publicized the allegations:
[April 10, 2016]
[May 1, 2016]
But city, state, and federal authorities took the recriminations seriously. They each began investigating how the Mayor filled CONY’s coffers. The probes, of course, were fodder for the front pages:
[April 9, 2016]
[April 23, 2016]
The Mayor, however, was never brought up on charges. But the rumors persisted, and the dailies kept questioning his “pay-to-play” handling of City business:
[December 12, 2016]
[December 11, 2016]
As it turns out, the Mayor had a question of his own.
Conflicts of Interest Board Inquiry
On December 16, 2013, Lawrence Laufer, Mr. de Blasio’s campaign lawyer, asked the Conflicts Board to settle an impending issue. He wanted to know if his client, “upon taking office as Mayor on January 1, 2014,” could “engage in fundraising on behalf of [the Campaign for One New York].” A few weeks later, in response, Nicholas Scoppetta, the Board’s Chair, wrote
Mayor de Blasio may not… direct a targeted solicitation to any individual who has, or whose organization has, a matter pending or about to be pending before any such executive branch office or agency.
In fact, doing so would violate Section 2604(b)(2) of the City Charter, the one that states
No public servant shall engage in any business, transaction or private employment, or have any financial or other private interest, direct or indirect, which is in conflict with the proper discharge of his or her official duties.
First Confidential Warning Letter — July 20, 2014
But the Mayor ignored Mr. Scoppetta’s directive. Less than six months afterwards, the Board mailed a confidential letter to Mr. de Blasio. Finally made public, it reveals that the Mayor made two solicitations on behalf of “Universal Pre-K NYC” (UPKNYC), a subsidiary of CONY.
On January 21, 2014, he “spoke by telephone to Bruce Ratner, Chairman of Forest City Enterprises, Inc., and asked for a contribution of $50,000 for UPKNYC.” Following the call, “Mr. Ratner’s brother-in-law sent a check to UPNYC in the amount of $25,000.”
That June, in an apparent trade off, the Mayor proposed holding the 2016 Democratic National Convention at Barclays Center, Forest City’s new arena in Atlantic Yards (today’s Pacific Park).
On Valentine’s Day, a few weeks after his conversation with Mr. Ratner, the Mayor “telephoned Marc Holliday, Chief Executive Officer of SL Green Real Estate Corp., to ask for a contribution of $100,000.” Now Mr. Holliday didn’t donate anything, but Mr. de Blasio seemed to do him a favor.
At the time, SL Green was securing permits to build One Vanderbilt tower, a 93-story skyscraper opposite Grand Central Terminal. To accommodate its size, the City would need to rezone Vanderbilt Avenue. A few months after his talk with Mr. Holliday, the Mayor spoke out in support of the rezone.
And yet, despite his breach of the City Charter, the Board was lenient with him. It concluded that “no enforcement action [was] required” because Mr. de Blasio both “self-reported” his “solicitations” to the Board and “voluntarily returned” Mr. Ratner’s brother-in-law’s check.
Instead, Richard Briffault, the Board’s new Chair, warned the Mayor “not to target” anyone with business pending before the City in the future. He also advised him to use “disclaimers” if making pitches for money. For example, Mr. Briffault suggested that Mr. de Blasio say “[Your] decision to give or not to give will not result in official favor or disfavor.”
Second Confidential Warning Letter — September 21, 2018
Four years later, however, the Board sent a second private letter to the Mayor. Again, it found he had not been listening. As the newly released document lays out, the Board caught him making three more prohibited solicitations.
On February 15, 2015, Mr. de Blasio “called Jeffrey Levine, Chair of Douglaston Development, LLC, a real estate development firm.” This was just after the Department of Housing Preservation and Development (HPD) had been involved with Douglaston. HPD not only transferred City-owned land in Mott Haven, the Bronx to Douglaston, it rewarded the firm with a $12 million stipend to build mixed-income apartments there too.
When the Mayor phoned, he “mentioned [the Campaign for One New York] and stated that Mr. Levine would receive a follow-up call from CONY’s fundraiser, Ross Offinger.” When Mr. Offinger rang him later, Mr. Levine “arranged a $25,000 donation” on behalf of Douglaston for CONY.
The following month, on March 20th, Mr. de Blasio reached out to “David Von Spreckelsen, President of Toll Brothers, Inc., a real estate development firm,” and “asked him to donate to help [his] affordable housing campaign.” According to thecity.nyc, “this was just a few days after the Department of Buildings had removed a stop-work order” on Pierhouse, the developer’s condo project in Brooklyn Bridge Park. Again, Mr. Offinger’s call followed the Mayor’s, and Mr. Von Spreckelsen wound up “donating $25,000 to CONY.”
Finally, in April 2015, the Mayor asked James Capalino of James Capalino and Associates, Inc., a major state-wide lobbying firm, “for support in advancing the City’s legislative and policy objectives.” As usual, Mr. Offinger succeeded the Mayor’s pitch and Mr. Capalino gave him $10,000. The lobbyist also “arranged for a total of $90,000 in donations from several of his clients.” That year, according to the State Joint Commission on Public Ethics (JCOPE), Capalino represented some 44 clients with business before the City. His roster included New York University, AirBnb, Cipriani, and Outfront Media.
In response, the Board chastised the Mayor. Mr. Briffault, writing for the group, stressed
By soliciting these three donations…and providing no disclaimers, you not only disregarded the Board’s repeated written advice, but created the very appearance of coercion and improper access to you and your staff that the Board’s advice sought to help you avoid.
He also reminded the Mayor that “a public servant who engages in solicitations such as these…acts…in violation of the City Charter.”
But, because CONY had been closed two years before the issuance of its new letter, the Board again let Mr. de Blasio off with just an admonishment. It determined that his “fundraising violations with respect to CONY or a similar organization will [not] occur again.”
The Mayor’s marks didn’t end up as lucky.
According to the New York State Lobbying Act, neither registered lobbyists nor their clients may give gifts to a third party “on behalf of or at the designation or recommendation of a public official.”
So in April 2018, after JCOPE investigated, it fined Mr. Capalino $40,000 for his donation to the Mayor. In November 2019, it handed down further penalties of $15,000 for the Toll Brothers and $10,000 for Douglaston. The parties paid, but none of them admitted to any wrongdoing. Neither did the Mayor.
The dailies had a field day:
[April 12, 2018.]
[April 9, 2018.]
Caught in Lies
On December 8th, when the letters were published, Danielle Filson, Mr. de Blasio’s spokesperson, told the media that
[The Mayor] has consistently acted in good faith and followed the [fundraising] process set out for him. The Board closed these cases and determined no enforcement action was necessary.
She even claimed he made the “appropriate disclaimers” during each of his fundraising calls. But this just wasn’t the case.
One of the reasons the Conflicts Board sent its letters to the Mayor in the first place was because he wasn’t issuing disclaimers. In fact, during the City Department of Investigation’s (DOI) own review of the Mayor’s fundraising tactics, Mr. de Blasio himself made it clear that he wasn’t.
In a heavily redacted memorandum released on October 22, 2018, the DOI recounted its interview with the Mayor where he said
He was not…specifically aware of the requirement to inform potential donors that their decision to give or not give would result in official favor or disfavor.
What’s worse, the DOI report substantiated claims that the Mayor was guilty of soliciting contributions from people with business “pending or about to be pending” before the City.
Yet in spite of the reminders and reprimands, he couldn’t or wouldn’t stop.
So when a reporter from the New York Times first asked him about the confidential letters in a press conference on April 29, 2019, Mr. de Blasio offered up subterfuge.
“Have you ever received what is known as a ‘private warning letter’ from the Conflicts of Interest Board?” the reporter posed.
“I know what the Conflict of Interest Board is,” the Mayor returned, “but I don’t know what a private warning letter is….
“Since I don’t know what it is, I can’t answer you.”
By that time, Mr. de Blasio had been sent the two letters.
(Screenshots of the New York Post and Daily News compiled by Rick Stachura.)
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