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The AQUEDUCT (AEG) scandal-State Democrats corruption, Schneiderman’s role- one more reason we need Dan Donovan as our new Attorney General

October 25, 2010

NY GOP Files Freedom of Information Request for Eric Schneiderman’s Records ASSOCIATED WITH AQUEDUCT BIDS

Albany, NY….October 25, 2010 The New York Republican State Committee today filed a formal Freedom of Information Law Request (FOIL) with the New York State Senate seeking production of emails, phone logs, and other records relating to Eric Schneiderman’s possible participation in rigging the bidding process for VLT terminals at Aqueduct Raceway.  The request formally seeks Eric Schneideman’s emails and phone records, memos, schedules and other documents, which may indicate his involvement, collusion or participation in the process that awarded a $300 million state contract to an unqualified entity – AEG.  The request seeks documents and correspondence that may indicate Schneiderman’s involvement, collusion, or participation in the AEG violations

“The Inspector General issued a scathing report, which implicated the entire NYS Senate Democratic Majority Leadership.  Eric Schneiderman served as Deputy Majority Leader for Policy and Chairman of the Codes Committee, and the public has a right to learn exactly what Schneiderman knew and when he knew it,” said State Republican Party Chairman Ed Cox.  “Schneiderman’s Senate leadership colleagues and the key lobbyist for AEG are accused of of bid-rigging and stonewalling the investigation.  Concurrent with their stonewalling of the investigation were Schneiderman’s fundraising activities for his current AG bid, at which point Eric actively accepted funds raised by these very same colleagues.  All of this begs the question as to what exactly Eric’s involvement was in the whole mess.”   

The FOIL hopes to answer key questions for the public about Schneiderman, his functions as Deputy Majority leader during this process, and whether he supports his colleagues’ efforts to block information from getting into the hands of investigators, law enforcement and the public. 

Does Eric support Sampson and Andrews’ efforts to block public access to key information?

·         State Senate Democrats Stonewalled the IG Investigation.  “Shortly after the Inspector General sent the above-mentioned letters to the senators seeking their voluntary corporation, Counsel to the Majority Shelley Mayer informed the Inspector General that the Senate would cooperate fully, but quickly withdrew this offer of cooperation and indicated that the Senate would not voluntarily comply with the Inspector General’s requests and would be represented by outside, privately retained counsel.” (IG Report Page 5). 

·         State Senate Democrats Sued to Quash the IG Investigation. “Sampson and Espada and the Senate commenced a lawsuit in State Supreme Court, New York County, to quash the Inspector General’s subpoenas. In this lawsuit, the Senate contended that a provision of the State Constitution, the Speech or Debate Clause, existing to protect legislative debate, shielded the Senate and senators’ actions in this multi-billion dollar procurement from public scrutiny. The Senate further claimed that the Inspector General had exceeded its jurisdiction.” (IG Report Page 6).

·         State Senate Democrats Attempted to Seal the Documents in the court proceedings. “The Senate not only attempted to inhibit public review of its actions, but even attempted to prevent public knowledge of its lawsuit against the Inspector General. Specifically, in its legal papers, at Senator Sampson’s direction, the Senate sought a “sealing order,” a legal device commonly associated with protecting vulnerable litigants such as juveniles, which would have rendered the entire proceeding unavailable to the public.”  (IG Report Page 6). 

·         The Court Found Against the Senate Democrats.  “Therefore – and let me say that the first and third arguments raised by petitioners [the claims that the Inspector General had exceeded its jurisdiction and the materials subpoenaed were irrelevant] I find without merit, that there was, in fact, a reason for the investigation and the requests and subpoenas are relevant to such investigation.” (IG Report Page 6). 

·         Schneiderman’s Former Senate Colleague Tried to Stonewall Investigation. “On February 19, 2010, the Inspector General served a subpoena on Carl Andrews & Associates. Andrews, a former state senator and member of the executive chamber, had been retained by AEG to lobby the Senate on its behalf. After a meeting with officials from the Office of the Inspector General was terminated upon Andrews’s refusal to answer certain questions, on April 23, 2010, Andrews filed a motion in State Supreme Court to quash the Inspector General’s subpoena.” (IG Report Page 7).

·         The Judge Denied Andrews’ Motion, and Andrews Intends to Appeal.  “On September 24, 2010, Justice Saliann Scarpulla denied Andrews’s motion and ruled that Andrews’s claims were “unavailing” and “without merit” in that the Inspector General was “well within its authority” to pursue the investigation and the information sought from Andrews was relevant to this legitimate inquiry. On or about October 6, 2010, Andrews filed a Notice of Appeal.” (IG Report Page 7).

Did Eric agree with his conference leader to ignore staff recommendations about AEG? Did he agree with Sampson’s lack of focus on AEG’s finances for a major revenue generator for NYS?

·         Sampson Ignored the work and advice of his own staff.  “Throughout the process, Senate Senior Assistant Counsel Higgins was preparing and updating multi-paged charts and notes that included both information submitted by the vendors and analyses by the executive agencies. Despite Higgins’s attempts to analyze and consolidate information, testimony from Senators Smith, Addabbo, Sampson and Adams establish that the senators essentially disregarded Higgins’s efforts, and relied instead on short oral briefings, their impressions from vendors’ presentations, and meetings with lobbyists.” (IG Report page 162).

·         Sampson Ignored the Finances of the Project, a Key Component of the Project. “As confirmed by Adams, Sampson deemed three criteria important to him, and by extension, the Senate: “M/WBE, community involvement and speed to market.” Conspicuously missing from Sampson’s listed criteria is the revenue generated for education in New York State. When confronted by the Inspector General with this glaring absence, Sampson cited the chaotic and constantly changing process as an excuse for minimizing or even ignoring the financials: “[Revenue] was important, but the numbers kept changing all the time. That’s why when I talk about this problem being chaotic and hectic, because, you know, everything would change.” Notwithstanding, Higgins’s comprehensive chart, which included information regarding all criteria as well as the up-to-date financial information, was readily available to Sampson had he taken the time to consider it.” (IG Report page 168).

·         Sampson Completely Ignored the Poor Finances of AEG.   “Although vague, these internal AEG e-mails are buttressed by internal Senate e-mails which also evince Senator Sampson’s favoritism of AEG from the outset of his entry into the selection process. In an August 19, 2009 e-mail exchange between David Evan Markus, Special Counsel to the Senate and currently Counsel to Senator Sampson, and Christopher Higgins of the office of Senate Majority Counsel, Markus observed, —Meanwhile do *you* want to call Adams and say that Sampson had asked that we rope him in on the mtg [sic] today specifically compare AEG to SL Green? Fwiw, [for what it’s worth] when I gave Sampson my comparison (e.g. AEG gives less cash upfront, takes longer to build out, needs financing, etc.), Sampson sounded like he was resisting and shifted focus to long-term revenue. I replied that long-term projections are very speculative even within the four corners of AEG’s proposal, to which Sampson replied that I should talk to Adams.” (IG Report Page 179)

Did Eric know that confidential bid information was disclosed to a lobbyist?  Does he support his Conference Leader Sampson for doing this? 

·         Sampson disclosed confidential bid information to former State Senator Carl Andrews. Thereafter, in November 2009, Senator Sampson met with AEG lobbyist Carl Andrews. Senator Sampson admitted to the Inspector General that, during this meeting, he disclosed to Andrews one or more internal senate memoranda analyzing the various bids and containing all the relevant bid information. Senator Sampson offered an innocent explanation for his disclosure: “We were having a little argument, and I think he was – he was a little pissed off ’cause I guess he heard – this process was so open notorious, and everybody talking, that we were, you know, not considering AEG, so we had a little confrontation.” The colloquy continued between the Inspector General and Senator Sampson regarding the alleged circumstances of this conversation with Andrews: (IG Report Page 211).

Also see our previous post on Scheiderman – A host of reasons why not to elect him!

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