Archive for March 2019

Campaign Finance Reform Hangs in the Balance in Albany

Posted by NYPIRG on March 25, 2019 at 8:25 am
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Last week, the debate came to a head over whether New York should create a voluntary system of public financing of elections. The state Senate, which appears to be a supporter, held a public hearing to gather testimony on the governor’s proposed plan.

It was clear there is strong support for establishing public financing in both the Senate and Assembly. Whether it gets done, however, is still an open question.

New York has long been on notice about the failure of its campaign finance laws. Thirty years ago, the final report of the Commission on Government Integrity found that New York’s campaign finance system was a “disgrace” and “embarrassingly weak.” That Commission then scolded state leaders for failing to act, “Instead partisan, personal and vested interests have been allowed to come before larger public interests.”

In 1987, then-Governor Mario Cuomo took a first step toward cleaning up campaign financing in New York State. Corruption scandals at the state and local government levels led to the creation of the Moreland Act Commission on Government Integrity to investigate ethics laws. The Commission issued 22 reports on a wide range of state and local ethics practices and held 17 public hearings, including one in which the governor and attorney general testified on their fundraising practices.

As a result of examining campaign financing practices, the Commission stated, “When running for public office requires enormous expenditures of privately raised funds, challenges to incumbents are all but limited to the most wealthy and well-connected. Moreover, huge campaign costs pressure candidates to maintain political views that do not offend big money.”

In its recommendations, the Commission called for immediate public financing of statewide races and to assess those results before expanding to legislative races. It viewed public financing as a “powerful tool” in curbing the power of organized and wealthy interests, to encourage electoral competition, and free candidates from at least some of their fundraising responsibilities.

Three decades later, New York City has one of the most far reaching and effective systems of financing campaigns for city office – in fact a model for the nation – and it has placed significant limits on the efforts of special interests to control government decision-making.

Yet in Albany, the work of the Commission was largely ignored. New York State still has sky-high campaign contribution limits, still allows unlimited donations to party and legislative leadership “soft money” housekeeping accounts, still permits unfettered campaign fundraising during the legislative session, and still lacks adequate independent enforcement.

In 2013, current Governor Andrew Cuomo created his own Moreland Act Commission to respond to “an epidemic of public corruption that has infected our state.” This Commission, like its predecessor, held public hearings, subpoenaed records, and issued a preliminary report.

A quarter century later, the second Moreland Commission arrived at similar conclusions as its predecessor, “Our investigation – including testimony taken at public hearings – also reveals that public financing systems, like the one in place in New York City, make a real difference, empowering regular citizens, reducing the power of massive checks and special interests, and increasing the accountability of officials to those they serve.”

Those findings were also ignored. Over the past thirty years, the scandals have not stopped. The failure to enact meaningful reforms after the first Moreland Act Commission’s reports sent an unmistakable signal – that Albany’s “pay-to-play” system was to be kept in place.

As a result, scandals continued and have continued. The state’s abysmal campaign finance system is inextricably linked to the state’s anemic democracy: It turns off voters by sending the message to average New Yorkers that your participation doesn’t matter.

Governor Cuomo and state lawmakers are elected to solve problems. Corruption and a disgraceful campaign financing system that fuels that corruption is a big problem. They’ll be making a big decision this week to continue to ignore or act upon the corruption crisis in state government.

Will Albany make history and address corruption? If so, they must act.

Sunshine Week in America, but Still Darkness in Albany

Posted by NYPIRG on March 18, 2019 at 6:56 am
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Last week was Sunshine Week; an annual celebration of the benefits of open government and discussion about ways to safeguard and expand upon current transparency laws. If the success of a representative democracy hinges on the informed consent of the governed, it is critical that the public know as much as possible about the information used and the processes by which its representatives spend tax dollars, act on policy recommendations and administer the laws.

As we all know, the reason such a week is needed is that our public servants far too frequently mislead the public and secretly make decisions that benefit favored special interests. For example, last week a former top aide to Governor Cuomo was sent off to prison to begin a six-year sentence for public corruption.

In his case and others that also resulted in corruption convictions, the evidence laid bare by federal prosecutors showed sweetheart deal making between government officials and lobbyists, “pay-to-play” campaign practices that hinged on big campaign contributions from those receiving lucrative government contracts, and a web of shadowy corporate entities created by the government through which billions of taxpayer dollars were spent outside of the normal transparency measures required of traditional government entities.

At the heart of some of the biggest scandals in modern New York are two non-profits set up by the government to act on its behalf. Since these two entities are technically not government, they fall outside of the normal public accountability measures found in the Freedom of Information and Open Meetings laws.

Fort Schuyler Management Corp. and Fuller Road Management Corp. are the two entities that have been at the center of the state’s economic activities as well as central to major corruption schemes. Fuller Road was formed in the mid 1990s and Fort Schuyler has been around since 2009. For years, Fort Schuyler and Fuller Road have operated with little scrutiny. They have been at the core of the state’s nanocenter enterprise that has spread across New York.

Fort Schuyler owns and oversees the massive projects at the center of the Buffalo Billion, a 2012 plan advanced by the governor to spend $1 billion to revitalize the state’s second-largest city, as well as other projects in Buffalo (including SolarCity), Albany, and Utica.

The corruption cases brought by the U.S. Attorney that led to the convictions of the governor’s top aide as well as the leader of New York’s hi-tech economic development efforts highlighted that the secrecy surrounding their deal making contributed mightily to a culture in which the risk of corruption grew.

That lesson has been taken to heart by the state’s top transparency office. The New York State Committee on Open Government – a state agency – recommended in its most recent annual report that any “entity created by a government agency or a subsidiary or affiliate of a government agency is, in reality, an extension of the government. The records of such an entity must fall within the coverage of FOIL.” FOIL—the Freedom Of Information Law—is the state law that gives the public the right to receive copies of government records unless they fall within one of a limited number of exceptions.

The annual report cited the U.S. Attorney’s investigation, stating “A significant element of a recent investigation by the U.S. Attorney for the Southern District of New York focused on non-profit entities associated with the State University of New York (SUNY). Efforts by the news media to gain access to records of those entities have been rebuffed, despite the Committee’s view that many are and have been required to comply with FOIL.”

During the current budget discussions, there appears to be agreement that the role of the state Comptroller—New York’s independently-elected fiscal watchdog—should be strengthened in overseeing these types of non-profit companies created by the government to supplement the government’s work.

Yet, there appears to be no movement to empower the public through more transparency in economic development decisions. There must.

It’s long past time that New York State and local governments comply with the highest standards of openness and public accountability. Unfortunately, after years of convictions of top ranking officials in both the Executive and Legislative branches, far too little has been done to bolster the public’s ability to better monitor its own government.

As we reflect on the benefits of transparency during Sunshine Week, this year the time is ripe to overhaul what ails Albany.

The Democrats’ Commitment to Campaign Finance Reform Gets Tested

Posted by NYPIRG on March 11, 2019 at 8:02 am
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Last week, the U.S. House of Representatives took a big step toward strengthening America’s democracy. The leadership pushed through H.R.1. H.R.1 included several voting reform measures, strengthened voting rights protections, and a proposed overhaul to the nation’s campaign finance system. In particular, H.R.1 set up a system of public financing based on a voluntary, small-donor matching system of public financing for Congressional races and strengthened the existing public financing system for presidential elections.

At its heart, H.R.1 would strengthen the role of average Americans in our political system – those who cannot write big checks. By creating a campaign finance system that would promote reliance on a large number of small donors, instead of the current system which relies on a relatively small number of large campaign contributors, H.R.1 reduces the risk of corruption and would encourage candidates to get more voters engaged in elections.

Of course, the House is not the final decisionmaker, H.R.1 must be approved by the U.S. Senate and the President. And it’s fair to say that the near-term prospects for passage are not good.

House Democrats pushed H.R.1 through, but they knew it was unlikely to be embraced by the Senate and the President. If the Democrats take control of the Senate and the White House, would that mean a version of H.R.1 would become law?

Let’s look at a similar situation in New York. For decades, the Democrat-controlled state Assembly approved versions of campaign finance reform similar to that proposed in H.R.1. They knew that even if the governor agreed with them, the legislation would be killed in the state Senate—which has been largely controlled by Republicans for decades. And they were right.

As of January, 2019 the Democrats have taken control of the state Senate and the Party now controls the lawmaking of New York’s state government. Will they act to approve public financing?

Some ten weeks into the Democrats taking the reins of state government, it looks like the answer is “no.”

Governor Cuomo inserted a proposal to establish a voluntary system of public financing for state elections into his budget in January. So far, so good. In the state Senate, an overwhelming majority of Senators have previously supported public financing, indeed the current Senate Majority Leader, Andrea Stewart-Cousins, introduced a bill along the same lines as the governor last year. That made things look more promising.

And as mentioned earlier, the state Assembly has approved public financing most years for the greater part of three decades.

So, it looked like big changes would come to Albany.  Thirty years after the Moreland Commission on Government Integrity described New York’s campaign finance system as a “disgrace,” state lawmakers would be considering a proposal by the governor to create a voluntary system of public financing that, like New York City’s, relies on small-donor matching.
This looked like the year it would get done. But now, at the last minute, it appears that the Assembly Majority is getting cold feet.

At an event last week, the Speaker of the Assembly said it appeared unlikely that the Assembly would approve public campaign financing in the final budget agreement. The Speaker was quoted in numerous media reports that the Assembly Democratic Majority now does not support public financing.

After decades of approving a significant campaign finance reform plan, knowing it would get defeated in the state Senate, now – according to the Speaker – the Assembly doesn’t have the votes to pass it when it can become law.
If public financing gets derailed, the big bucks will continue to roll in and Albany will be worse off.  And the broken promise in Albany will undermine the pledge made by Democrats that if they take control nationally, they will pass public elections financing as contained in H.R. 1.

New York State should show the nation not only how to advance bills, but how to pass comprehensive changes aimed at reducing the risk of corruption as well as pulling back on the power of wealthy interests.

The fate of public financing is expected to be determined next week. New Yorkers desperately hope that Albany will finally deliver real reform that reduces corruption and boosts democracy. It looks like the fate of public financing is held in the hands of the Assembly Democrats and the political leadership of the governor and the Senate Majority.

Lawmakers Enter the Homestretch on the Higher Education Budget

Posted by NYPIRG on March 4, 2019 at 9:13 am
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In the Spring of 2011, Governor Cuomo announced “SUNY 2020,” a plan to allow annual public college tuition hikes. Called “rational tuition,” the plan’s regular tuition hikes justification was that it would ensure that incoming public college students would know what they were signing up for in terms of future tuition costs.

The tuition plan had another component: Under SUNY 2020, the state promised that it would not reduce the general operating funds of the State University and the City of New York University systems in following years’ budgets. The provision, called the state’s “maintenance of effort,” was to make sure that increased tuition would not be offset by decreased state support. Thus, new tuition dollars were to be used for improving student services, not to fill budget holes created by diminished state support.

Unfortunately, while the state has maintained its level of funding at the 2011 levels, it has not raised funding in the face of rising costs due to inflation, contracted salary increases and rising utility costs. As a result, despite the promise that the state wouldn’t reduce support for the public university systems, that is in fact what happened.

The gaps in funding led to cuts in student services, reductions in faculty hires, and clawing back of some of the tuition dollars to pay for maintaining existing programs.

The situation has become so bad that the Legislature has repeatedly, and overwhelmingly, approved legislation to fulfill the state’s promise and boost resources for both SUNY and CUNY to offset the impacts from inflation and rising fixed costs. Governor Cuomo has consistently vetoed that legislation, creating the ongoing budget crunch faced by public colleges.

But the crunch is even worse than it appears. Another provision of the SUNY 2020 plan was that SUNY and CUNY colleges were required to cover any additional tuition costs not covered by state financial aid assistance.

Previously, when public college tuition went up, lawmakers ensured that the state’s Tuition Assistance Program (TAP) would increase too. Thus, the poorest college students would get their tuition costs covered by financial aid no matter what level of tuition was charged by the state.

Under SUNY 2020, that system was ended. Instead of the state providing coverage for the full costs of the annual public college tuition hikes, the colleges themselves now had to come up with the extra money to cover these increased costs for their poorest students.

The growing gap is taking a bigger and bigger bite out of stagnant state support. For example, SUNY tuition is $6,870 for this academic year. The maximum TAP award covers $5,165, meaning that the local campus had to make up the shortfall. That policy adds to the financial stress felt by public colleges and universities.

This budget “one-two punch” – one from an inadequate SUNY 2020 program and the other from a shift in financial aid from the state to public college – has resulted in serious budget shortfalls on SUNY and CUNY campuses.

According to one SUNY campus administrator, revenues are simply not keeping pace with necessary increases in expenditures. One factor cited was the lack of increases in direct state support since 2012. In response to an anticipated $5 million budget deficit, one SUNY campus implemented a 90-day hiring freeze for replacing retiring faculty.

A CUNY college President released a statement that they expected a $5 million budget shortfall and were implementing across-the-board department budget cuts and vacancy-control measures. The announcement also made clear that the increased tuition revenue from the latest tuition hike would cover mandatory, predictable collective-bargaining costs.

The erosion of state support and the creation of growing funding gaps is translating into an erosion of student services and quality of education. Students are experiencing difficulty in getting into the classes they need to graduate, limited services such as library hours, and advisement gaps across the CUNY and SUNY system. According to a CUNY survey, over a third of CUNY students reported not being able to register for a course they needed for their major. Of those students, half couldn’t register because there were not enough seats available.

Not being able to attend required classes also has the effect of forcing students to stay in college longer – which increases costs and often college loan debts. And higher tuition costs shifts the burden of public college financing from the state to the families of those attending SUNY and CUNY.

State lawmakers have been hearing a chorus of concern from campus administrators, faculty, and students from across the SUNY and CUNY systems. By the end of this month, New Yorkers will know if lawmakers are willing to push back on the governor and shift away from New York’s stagnant state budgetary support to a more robust system that increases support in the face of rising fixed costs. Until then, students, parents, faculty and administrators will be on the edge of their seats.