In New York, Calls for Reform Amid Corruption

April 4, 2013 Updated: April 7, 2013

NEW YORK—The allegations of corruption against state Sen. Malcom A. Smith and New York City Council member Dan Halloran rocked the state this week.

The charges—bribery, wire fraud, and extortion—showcased the dirty side of New York City politics, but for reformers, the case is an opportunity for change.

“In some sense, we are very lucky,” said Larry Norden, deputy director of the non-partisan public policy and law institute Brennan Center for Justice. “We have an opportunity in New York State to make a big change.”

Advocates, good government groups, and politicians are calling for various methods of reform, all with the same underlying theme: removing corruption and bribery in politics, especially through reforms around campaign finance and discretionary funding.

Campaign Finance Reform

After years of heavy corruption, New York City lawmakers created the Campaign Finance Board in 1988. Today candidates are offered $6 in public money for every $1 earned on the campaign trail.

New York state lacks such a system, and reform advocates charge that without it, politicians open themselves up to money from lobbying groups and large donors—money that often comes with strings. 

Campaign finance reform bills have been brought up in the state Assembly for nearly 20 years, but they have never made it past the state Senate.

Earlier this year, Gov. Andrew Cuomo said the state should adopt legislation similar to New York City’s. 

At an event in early March, Gov. Andrew Cuomo acknowledged that despite the benefits, campaign reform legislation will be difficult to pass. “For the legislators, this is not about changing a policy that will affect someone else,” Cuomo said. “This is changing a policy that affects them and their livelihood.”

Discretionary Funding

At both the state and local level, politicians are given sums of taxpayer money to use in their district for local improvement, called discretionary funding. 

According to the court documents, Council member Halloran allegedly tried to give $80,000 in discretionary funding through a nonprofit group to a fake consultant. 

On Wednesday Public Advocate Bill de Blasio, who is also a mayoral candidate, called for an immediate ban to discretionary funding. Major reforms have been made since 2006, but de Blasio called the efforts insufficient.

Dick Dadey, executive director of good government group Citizens Union, said Halloran would have likely been caught under the current reform measures. “The recent reforms to the process would have prevented that money from being spent the way he wanted it,” Dadey told Crain’s. 

At a Wednesday press conference, Speaker Christine Quinn defended the reforms already in place as effective measures for catching crooked politicians. 

“I do not think this is a reason to conclude member items should not be given,” Quinn said, adding too many important organizations would stand to lose out on much needed money. 

Quinn, who is in charge of how much discretionary funding each council member gets, was recently accused in a New York Times article of using her power to punish some council members by pulling member item funding. The speaker denied the charges.

A representative for de Blasio said they are talking to legal experts to understand what agency or official would have the power to enact such a ban, and how it would work.

The Enforcer

The case against Smith and Halloran was brought up by Manhattan U.S. Attorney Preet Bharara’s office.

Citizens Union, which released a six-pack of reform suggestions, noted the feds once again leading the way. 

“We cannot have a situation in which enforcement is resting on the shoulders of Preet Bharara and the state and local entities are not leading the way,” Alex Camarda, director of public policy at Citizens Union. “They need to step up and do their jobs.”

Bharara’s office has brought corruption charges against 14 elected officials since 2010, eight of whom have pleaded guilty or were convicted.

Citizens Union suggested giving additional funding to the state and local boards of elections for further enforcement and oversight. 

John Conklin, spokesman for the New York State Board of Elections, said the agency performs investigations, but does not have the power to prosecute. Conklin said the agency investigates any complaints it receives and did not have a backlog.

The New York City Board of Elections did not return calls by press time. 

Citizens Union also suggested giving the state attorney general the power to initiate and pursue allegations of public corruption, something that could be granted by Gov. Cuomo.

State Attorney General Eric Schneiderman has no comment about the suggested powers at this time, but as a candidate running for the office in 2010, it was something he supported.