ALBANY — In the wake of the corruption convictions of two of the State Legislature’s top former leaders, Gov. Andrew M. Cuomo said Monday he will push a new package of ethics in the coming legislative session.
But Cuomo said he believes that a top reform priority of good-government groups — closing the so-called LLC loophole — would be ineffective, even if passed by the legislature, because of a federal court ruling.
An element of state campaign finance law allows companies to exceed their $5,000 corporate limit by creating limited liability corporations. Through the LLCs, often with names that mask the parent company’s identity, corporations can contribute in total more than $100,000 to candidates and their political parties.
One of the companies that uses this loophole the most — the Manhattan real estate firm Glenwood Management — contributed to former Assembly Speaker Sheldon Silver (D-Manhattan) and former Senate Majority Leader Dean Skelos (R-Rockville Centre). Silver and Skelos were convicted this month on corruption charges. The company and its founder were mentioned in each trial, although they were not accused of wrongdoing.
Glenwood is also one of Cuomo’s biggest donors, providing his campaign with more than $1 million. Cuomo said that he’s never been influenced by donors and that he’s unsure if any legislators were influenced.
How much has Cuomo taken through the LLC loophole?
The NY Times reported that Cuomo received about $1.4 million in donations through LLC's from January 2015 to June 2015 - which, extrapolating out, is a nice chunk of change every year.
Pro Publica reported in July 2014 that Cuomo had raised 6.2 million dollars from LLC's for the first three and a half years of his administration - this, despite claiming more than once that he planned to close the loophole through a push for reform.
One of his flying attack monkeys explained the contradiction between taking millions through the loophole yet claiming to be against it this way:
In a statement, Cuomo spokesman Matthew Wing offered this to explain the apparent contradiction: "The Cuomo campaign is following existing campaign finance laws, while the Governor is leading the charge to reform them, including closing the loophole for LLCs."
This is the same game Cuomo's playing now, claiming to be against the loophole and moving to close it while undercutting those claims with his every action.
Pro Publica reported that the Moreland Commission had been investigating LLC donations until Cuomo closed down the commission in return for a lukewarm ethics reform package and budget deal agreement with then-Assembly Speaker Sheldon Silver and then-Senate Majority Leader Dean Skelos - now both convicted on corruption charges.
Closing the LLC loophole was of course not part of that lukewarm ethics reform deal Cuomo got in return for closing down the Moreland Commission.
As noted in Gormley's Newsday piece, crooked real estate outfit Glenwood Management was the governor's biggest donor, giving money directly to Cuomo as well as steering it to Cuomo-linked entities like the State Democratic Party and his friends at the shadowy PAC the Committee To Save New York - but Glenwood wasn't the only real estate company to utilize the LLC loophole:
Another real estate developer, the Extell Development Co., has also given extensively to Cuomo through LLCs, including two donations last year that were flagged by the Moreland Commission.
Two LLCs affiliated with Extell gave the governor a total of $100,000 on Jan. 28, 2013—two days before Cuomo signed legislation that granted a tax break to Extell's One57 skyscraper in Manhattan, as well as properties owned by four other developers. Two other LLCs with ties to Extell gave Cuomo another $100,000 six months later. (The contributions were first reported last year by The Daily News.)
Other companies besides the real estate interests have utilized the LLC loophole with the govenror as well:
Since the governor took office, Time Warner Cable has contributed more than $60,000 to him through its LLC; LLCs affiliated with Cablevision have given $110,000. Two liquor distributors, Empire Merchants LLC and Empire Merchants North LLC, have given over $120,000. And two LLCs affiliated with the Ultimate Fighting Championship have contributed $115,000 to Cuomo, plus tens of thousands of dollars more to state legislators and political committees.
Cuomo has not proposed any legislation to legalize professional mixed martial arts events in New York, the only state that bans them. But almost a year after he received a $50,000 check from one of the LLCs, Cuomo seemed to come out in favor of overturning the ban.
"I think we need economic activity, especially in upstate New York," he said in a radio interview in 2013. "I think this is a major endeavor that is televised, that is happening all over the country at this point. You're not going to stop it from happening. And I'm interested in the potential economic potential for the state."
No wonder Cuomo plays this sham with LLC loophole closure - he's sucking up an awful lot of money via the LLC loophole that he wouldn't be able to get otherwise.
It's not like Cuomo, an unpopular governor with a job approval rating below 40%, is raking in millions from little people looking to support a politician.
He's raking in the big bucks from powerful interests looking for influence in Albany and since they can only give so much directly, the rest has got to be steered to him through various LLC's that hide who is giving the money and where it's coming from.
No wonder his actions belie his statements on the LLC loophole - there's just too much money to be made here for the governor to want to truly close the LLC loophole.
Dunno if Preetmas is coming this year, next year or ever, but given how criminal and corrupt this governor is, how he plays this sham game of claiming to be a "reformer" on the one hand while taking all these corrupt and/or hypocritical actions on the other, we surely need it to clear away this last man in the room.
Cuomo's facing criminal charges on corruption might not clean up the cesspool that is Albany, but it surely will clean up the part right at the center, where Cuomo himself stands.