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Perdido 03

Sunday, May 15, 2016

Federal Investigation Into Cuomo's Economic Development Program Expands Statewide

Tom Precious of the Buffalo News does an amazing job of putting together the various strands of the federal investigation into Governor Cuomo's economic development programs.

According to Precious, here is what U.S. Attorney Preet Bharara has subpoenaed:

All documents relating to the October 2013 request for proposals for the Buffalo Billion program as well as a development project by the same state university-created corporation – Fort Schuyler Management Corp. – in Syracuse, along with a March 2015 RFP by a sister entity for a since-stalled dormitory project at SUNY Polytechnic in Albany;

• Details about certain actions taken by Percoco, Howe, several top current Cuomo advisers and the head of the state Power Authority, as well as Peter Cutler, a longtime Democratic operative from Buffalo who recently left Cuomo’s economic development field office in Western New York. The New York Post first reported that last week. Cutler last week confirmed he, too, had received a subpoena from Bharara’s office, though he declined to say what he is being asked to provide;

• Any actions by those individuals “for the benefit of” nearly two dozen companies, including LPCiminelli, the Buffalo construction company handling construction of the RiverBend complex, and Norstar Development USA, a Buffalo-based company headed by the former top housing czar in the administration of the late Gov. Mario Cuomo, the current governor’s father;

• Phone logs, visitor logs and calendar entries going back to January 2012 that might show meetings or contacts between administration officials and two dozen people or entities, including Ciminelli, Norstar, several Syracuse firms, a Brooklyn real estate developer, a Rochester real estate company, and two firms that, according to Percoco, paid him up to $120,000 in consulting fees sometime in 2014. Also on the list: Alain Kaloyeros, the SUNY Polytechnic president and Cuomo point person on the Buffalo Billion, as well as Howe.

In addition, Bharara wants to see what the administration has been saying internally about the now expanding Buffalo Billion probe. The subpoena seeks “all documents or communications related to the investigation by the U.S. Attorney’s office” that are in possession of Cuomo’s office.

The broad subpoena has “driven the administration crazy,” according to a source close to the matter.

It seeks all documents Cuomo’s office has on file about Howe, the Washington lobbyist and Cuomo insider. He has been described as the go-between person between companies looking to expand to upstate ventures, such as the Buffalo Billion and high-tech projects in other upstate cities that SUNY Polytechnic, and the state’s economic development office oversee, according to sources.

Prosecutors want Cuomo’s office to also give them all documents relating to WOH Government Solutions, the lobbying entity Howe headed before he was recently fired, and its parent company, Whiteman Osterman & Hanna, the Albany lobbying and law firm. That firm has worn many hats, representing, for instance, SUNY Polytechnic or one of its subsidiary corporations and LPCiminelli.

Precious writes that "Bharara wants to know if key Cuomo people, past and present, did anything to “benefit” several companies that have been a part of various state-financed projects."

Now it's possible that he's looking at just Cuomo's minions like former aides Joe Percoco and Todd Howe or Suny Polytechnic's Alain Kaloyeros to see if and how they've enriched themselves off the contracting process with many of the companies subpoenaed in the investigation.

But it's also quite possible that he's looking at the donations Cuomo received from those subpoenaed companies, in which case Cuomo himself may have a bit of trouble.

See, it's a quid pro quo to solicit campaign donations in return for favors, contracts, tax subsidies or grants, so if there's any evidence anything like that occurred, Governor Cuomo would have some legal problems.

The most interesting instance where you could see Preet making that case is with COR Development and the report that came this week from Jimmy Vielkind at Politico NY.

The gist is this:

On December 14, 2015, Governor Cuomo attended a dinner hosted by Todd Howe, his former aide who was then a lobbyist for a subsidiary of Whiteman, Osterman & Hanna.

The dinner took place "in a small upstairs room of the Fort Orange Club, a baronial brick retreat across the street from Whiteman’s Albany offices and up the block from the state Capitol."

At the dinner?

Cuomo and Howe (who Cuomo said last week he doesn't know that well), two other aides (Bill Mulrow, the governor's secretary, and Joe Percoco, Cuomo's closest aide who is also reported to be under federal investigation for conflicts of interest and other corruption charges), Onondaga County Executive Joanie Mahoney, a key Republican ally of the administration, and three executives from COR Development, a company of interest in Preet Bharara's federal investigation.

Cuomo took in $25,000 in five checks that night, three from COR executives, one from one of the wives of a COR executive and one from an LLC linked to COR Development.

COR Development has been Cuomo's biggest donor from Central New York, giving him more than $300,000 since 2010, including $50,000 in the last year.

And what did COR Development get in return?

The company has received contracts from the state for numerous projects under Cuomo. COR built a $15 million film hub for New York state in 2015 on land it owns in DeWitt. Cuomo announced COR would also build a $90 million facility for Soraa, an LED lighting manufacturer at the same nanotechnology hub.
COR is also developing the Syracuse Inner Harbor, but that project has run into trouble. The city of Syracuse, which named COR as its developer, is now suing COR over tax breaks for the Inner Harbor project that the company obtained from Onondaga County's industrial development agency.

There's another interesting Cuomo angle here too.

Cuomo's D.A. buddy, William Fitzpatrick, who served as a Cuomo ally and apologist on the Moreland Commission that Cuomo shut down in 2014 (and whose wife needed to be reappointed to a judgeship by Cuomo), is investigating Syracuse Mayor Stephanie Miner (once a Cuomo ally, now a Cuomo enemy) over the lawsuit the City of Syracuse brought against COR Development.

That Fitzpatrick investigation appears to be both frivolous and retaliatory, judging by this piece of news from

SYRACUSE, N.Y. -€“ Saying he does not intend to assist a "fishing expedition,'' an Onondaga County judge this week delivered a setback to District Attorney William Fitzpatrick and his efforts to investigate alleged wrongdoing at Syracuse City Hall.

County Court Judge Walter Hafner Jr. blocked Fitzpatrick's subpoena for emails, notes, drafts and other communications produced by Syracuse city lawyers, saying the DA made "no showing'' that the documents were part of any crime or fraud.


The district attorney, who criticized Syracuse Mayor Stephanie Miner for bringing a lawsuit against COR Development Co., the Inner Harbor developer, has launched an investigation into Miner and some of her political allies.

Among other things, Fitzpatrick is looking for evidence of alleged wrongdoing connected with what he called "phony affidavits'' filed in the lawsuit by two city councilors who are friendly with Miner.
But in his ruling to decide what documents city hall must turn over, Hafner said Fitzpatrick has not produced evidence of wrongdoing to justify his demand to see communications between city lawyers and other city officials. Most of those records are protected from disclosure by attorney-client privilege, the judge wrote.

In response to the district attorney's request that Hafner review all the city hall materials privately to determine whether any should be forwarded to the grand jury, Hafner called that proposal "patently absurd.''

"It is not . . . the function of this court to assist the district attorney in a fishing expedition,'' Hafner wrote.

Interesting how Cuomo's ally/apologist, William Fitzpatrick, is taking on Cuomo's enemy, Syracuse Mayor Stephanie Miner for Cuomo's biggest donor in Central New York, COR Development.

Here's Miner's rationale for the lawsuit:

SYRACUSE, N.Y. – Mayor Stephanie Miner set out Tuesday to kill the biggest Syracuse development in years – the $324 million Syracuse Inner Harbor project – after the developer went around the city to negotiate lucrative tax breaks from Onondaga County.

The mayor is trying to halt a transformative Inner Harbor project that she herself launched four years ago, after previous mayors tried and failed. The ambitious new waterfront neighborhood would have been her most visible accomplishment as mayor.

Miner's drastic move came after the Syracuse Industrial Development Agency was squeezed out of control over the Inner Harbor deal by a developer with strong ties to Gov. Andrew Cuomo and to Cuomo's allies in Onondaga County leadership.

"What you are seeing here is a clash of philosophy on economic development,'' Miner said in an interview today. She said the lawsuit aims to preserve the city's sovereignty over how the project gets done.

''It's about this: The developer doesn't get to set the terms and conditions of all the things that they want to do, which, in my experience is different from what has been done previous to my administration,'' Miner said.

Miner filed a lawsuit Tuesday that aims to halt the Inner Harbor project by nullifying the city's sale of the land to COR Development Co. She said COR should be required to meet significant local hiring and job-training quotas in return for any discount on property taxes.

Also should note that Cuomo's Republican ally, Onondaga County Executive Joanie Mahoney (who just happened to be at the December 14, 2015 fundraiser with COR Development, Cuomo, Howe and Company), has launched attacks against Miner for the COR lawsuit, calling Miner "emotional" and hurting the City of Syracuse for "lashing out" after getting her feelings hurt.

Yeah, kid you not - that's what she said.

There's so much here in this COR Development story and at the center of all of it is not Todd Howe, the lobbyist and former aide to Cuomo who is reported to be under investigation by the feds, but rather one Andrew Cuomo, whose allies have launched attacks and investigations against one of his enemies after said enemy filed a lawsuit against his bestest donor in Central New York.

This Syracuse/COR story is just one of the strands Preet Bharara is following in his investigation - as Tom Precious reported in his Buffalo News story, there are many others as well.

But it's this COR Development strand that really intrigues the more one follows it, because you can see how the guy at the center of so much of the action is Governor Andrew Cuomo.

Cuomo told reporters last week that as far as he knows, the investigation is just related to two of his former aides, Percoco and Howe, thus sending out the not-so-subtle message that he himself is not under investigation.

Perhaps that's how the investigation started, but what do you think Bharara does when he gets all this interesting information and evidence in the COR Development strand?

Does he not continue to follow up to find out just how the tax breaks got handed out, why Stephanie Miner was pushed out of the deal and Cuomo's Republican ally, Joanie Mahoney, elevated, why Cuomo's D.A. ally/apologist is investigating Miner (and was it at the behest of Cuomo himself)?

Oh, so much to look at here, so much to marvel at.

It's the perfect Cuomoesque ratfuck that got pulled here, but in the end, if Bharara follows this Syracuse/COR strand to its very end, it may be Governor Cuomo himself who gets screwed.

Precious wrote that the Cuomo administration is being "driven crazy" by all the information Bharara is looking for.

Good - couldn't happen to a nicer bunch of people.


  1. Just read theBuffalo News article.

    WOW, just wow!

    1. Yeah - it's now a very wide, expansive investigation. As I wrote in the post, Cuomo wants us to think they're just aiming at Percoco and Howe, but you can see from what Bharara's looking for that it goes deeper than that. Hard to know if it ever gets as high as Cuomo, but that COR story sure does seem a little, uh, interesting.

  2. I may have given up hope on Preet too soon - up to now, everything he's done has only HELPED Cuomo grab even more power. but now...

    1. Some details on both the people and companies subpoenaed, courtesy of the Buffalo News, with some thoughts on what you're saying:

  3. Preet sucks up to the Obama admin.

    1. Maybe.

      But maybe not.

      This is an awful lot he's going for:

    2. Given the chances of a Clinton presidency, Bharara better indict Cuomo before November and Her Majesty names him Secretary of Douchebaggery.


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  5. Thanks for the information provided. To be honest, I don’t really understand why it was necessary to investigate the program of the economic development. Into my opinion, the economy is growing and we all can see that. Many people have jobs and there are career opportunities for everyone. Yes, there are people living through fast easy online loans but most Americans have stable income. Of course, the economy is not perfect but I think that we are on the right track.