A complicated web of coordinated activities, shared resources and staff, and quiet money transfers between the Working Families Party, a secretive private company called Data and Field Services and at least six current Council campaigns, as well as Bill de Blasio’s campaign for public advocate, appears to have found several ways around the strict city campaign finance laws. Upwards of a million dollars, and possibly more, are involved, with over $1.7 million in matching funds comprised of taxpayer dollars already disbursed and more are potentially at stake.
There have long been assumptions and rumors of the collaboration between the Working Families Party (WFP) and its favored candidates, but never before has the scope of or intricate processes behind its joint activity been exposed to the degree made possible by an extensive review of public documents and close to 50 interviews with a range of key players conducted by City Hall over the last few days.
The article goes on in great detail and is well worth reading.
Another City Hall News article basically has the lawyer who helped set up the whole scheme admitting that WFP is indeed sidestepping transparency and quite possibly the actual rules by not adequately separating the political party (WFP) from its for-profit spinoff (DFS). It is kind of amazing that WFP thinks this is okay, whether or not it winds up being strictly legal. Strikes me as precisely the kind of BS reform Democrats are trying to stop. But then again, I have come to realize WFP is NOT about reform, which is why they can buddy up with corrupt Brooklyn Party boss Vito Lopez and his aide Steve Levin.
Yet another City Hall News article takes the scandal further, showing that Working Families Party may well be violating further election finance laws but either not properly reporting or not properly paying rent on some of their offices:
A review of the Party’s expenditures in public documents filed with the state Board of Elections over the last decade which were reported as rent shows an erratic pattern of payments made to several different landlords, and none marked as going directly to Flatbush Fulton Realty Associates, the owner of its current space at 2 Nevins Street in Brooklyn. Some years, the WFP appears to have paid no rent at all, based on the data filed with the Board of Elections.
Political parties are required to pay rent, in order to ensure that no party is getting an unfair monetary advantage over others, and the parties are required to report all money paid out for expenditures.
"The committee needs to account for any expenditures they have, and if they receive any in-kind contributions, then the value of those as well," said Bob Brehm, a spokesman for the state Board of Elections.
Furthermore, it seems no one can get a straight answer from WFP regarding the rent scandal:
In an email sent Tuesday night, Levitan offered an explanation for why rent had spiked in recent months, arguing that the money paid so far in 2009 went to "rent and overhead to pay for our main office, office space in Buffalo and Albany, and spillover offices in Brooklyn. The increase in rent reflects the higher price of our new office space on 2 Nevins Street."
No payments show up as going to Buffalo, and except for those which went to the Association of Black, Puerto Rican and Asian Legislators PO box in 2007, none show up as having gone to Albany either.
You'd think they'd check if their excuses even made sense before they gave them publicly. You can't explain sudden spikes in rent payments using numbers that are, effectively, zero. Of course why they are zero is another part of the mystery. This is all at best sloppy record keeping of numbers that are critical for campaign finance regulations to work. At worst it is further evidence of outright corruption within Working Families Party.
The candidates who are potentially caught up in this scandal are Bill de Blasio (running for, ironically, Public Advocate), and several city council candidates: Brad Lander, Debi Rose, Daniel Dromm, Lynn Schulman, Jumaane Williams, S.J. Jung, Jimmy Van Bramer. The first City Hall News article I link to above outlines in huge detail how each of these candidates are using WFP personnel and/or resources in a way that may well either violate or at least dodge existing campaign finance laws. NOT something that makes them look like reform-minded candidates.
The latest development is the fact that the Campaign Finance Board has ruled that WFP and these six candidates indeed violated the law:
The Campaign Finance Board has issued a statement declaring that it understands Data and Field Services to be "an arm of the Working Families Party." As such, the board has declared that any activities done by the WFP must be reported as expenditures by the campaign, and not just those billed to the WFP’s private company. In the closing two weeks of the campaign, that could mean the campaigns racking up big costs for staff, mailers and other campaign material which they might otherwise have gotten at no cost...
The candidates using Data and Field Services are public advocate candidate Bill de Blasio and Council candidates Debi Rose, Danny Dromm, Jimmy Van Bramer, Lynn Schulman, Jumaane Williams, S.J. Jung and Brad Lander. All have also been endorsed by the WFP...
"There has been much attention surrounding potential violations of the New York City Campaign Finance Act and Board Rules by campaigns that have hired Data and Field Services, Inc. ("DFS")," the CFB statement reads. "The potential violations are twofold: (1) that campaigns are not paying full market value for services; and (2) the potential for non-independent expenditures due to DFS’ close affiliation with the Working Families Party and its affiliates.
"Based on information acquired by the Board to date, it is the Board’s understanding that DFS exists as an arm of the Working Families Party. Both organizations are located in the same space and share employees; DFS was created by Working Families Party staff; and there are no apparent firewalls between them. In light of the close affiliation, the Board presumes that any activity undertaken by the Working Families Party on behalf of campaigns using DFS as a vendor is non-independent. Therefore, these activities must be reported and accounted for by campaigns as either an in-kind contribution from the Working Families Party or an expenditure.
"In determining whether expenditures by an outside party are non-independent, the Board applies the factors in Rule 1-08(f). The Board makes no determination regarding violations at this time. Every campaign will be afforded the opportunity to be fully heard regarding potential findings of violation."
Seems Working Families Party and these six candidates have some explaining to do! I'd say particularly Bill de Blasio since he is running for Public Advocate, a position designed to protect the public from just such abuse of power by politicians. Electing de Blasio would be the typical fox being put in charge of the hen house.
I should note that I have endorsed one of the candidates caught up in this scandal, Daniel Dromm. I don't know if I consider involvement in this scandal a deal breaker, but Dromm definitely is on thin ice with his WFP connections and involvement in this scandal is one strike for a candidate in my book. I like everything else about Dromm, but his ties to WFP do raise an eyebrow in light of this scandal. Interestingly, another candidate that WFP and I agree on, John Liu (running for Comptroller) has conspicuoulsy NOT been mentioned in this WFP scandal, so perhaps he followed the rules in his connections with the WFP. I find this encouraging about Liu. The imnpression I get was that he knew how to do things right and has played by the rules in ways that these other WFP candidats have not. I'd say knowing what the rules are and how to play by them are a good thing in a Comptroller!
In other cases I should note I have endorsed candidates opposing the WFP candidates involved in this scandal. Brad Lander is running against my friend Josh Skaller (whose personal endorsement by Howard Dean I wrote about on DK). Lynn Schulman is running against my endorsed candidate Mel Gagarin. And I also have endorsed Brent O'Leary over Jamie Van Bramer.
Of course I want to give credit where credit is due. This story was first mentioned in the NYC blog Room 8 where another blogger (whose identity or identities have been much discussed) has already written about supposed corrupt behavior by WFP, targeting Brad Lander in particular. And one particular accusation, made in May, is of note because it presages the current scandal. From Hildy Johnson's article:
These transactions are hidden behind a wall of corporate secrecy.
Yes, corporate: To run its canvassing operations, the WFP has created an in-house, for-profit corporation called Data & Field Services. The party publicly discloses only the five-figure lump sums it occasionally "pays" the company. (Some individual candidates also disclose payments to DFS.)
This practice apparently violates state campaign-finance regulations. Board of Elections officials insist that party committees are required to itemize exactly who gets the money they dispense, even if it's paid through an "outside" vendor. While the public can sometimes see where the WFP's money comes from, it knows very little about where it goes. In the Working Families Party, ACORN has created a conglomerate that is one part campaign machine, one part commercial enterprise and one part lobbying-clearinghouse for special-interest money and muscle -- a conglomerate that is shored up by its privileges as a state-registered political party and shielded from scrutiny by a corporate subsidiary.
Of course this is precisely the scandal that is now hitting the papers, brought up months before by a Room 8 blogger. Though I should note that Lander does not seem to be the worst of the candidates caught up in the scandal. Four of the six candidate, including de Blasio, seem to be deeper involved in the scandal than Lander has been, as outlined in this City Hall News report.
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