Friday, April 11, 2008

Forest City Ratner eighth in state lobbying, but has second-largest contract

You didn't read this in the New York Times (or several other media outlets), but Forest City Ratner, though dropping to a eighth among lobbyists statewide in 2007, still managed the second-largest lobbying contract. In the 2006 tally, the developer was third in total lobbying and had the largest lobbying contract.

Significant FCR spending in 2006 was understandable; the project was approved that year by the Empire State Development Corporation and the Public Authorities Control Board.

However, the continued spending reminds us of the "Atlantic Yards permanent campaign;" even though the project has received official approval, much more, including a special 421-a tax break (achieved) and a campaign for additional subsidies (anticipated) was on the developer's agenda.

State report issued

On Wednesday, the New York State Commission on Public Integrity (CPI) released its 2007 Annual Report. The CPI, created by the Public Employee Ethics Reform Act of 2007 (an achievement of Gov. Eliot Spitzer), combined the staffs, jurisdictions, powers, duties and functions of the New York Temporary State Commission on Lobbying and the State Ethics Commission. (The figures cover lobbying at the city and state level.)

The press release states:
O'Brien & Gere Limited had the largest lobbying contract, valued at $1,547,812. The firm lobbies on its own behalf. Forest City Ratner Companies, a commercial real estate company, had the second largest contract with Fried Frank Harris Shriver & Jacobson, LLP, valued at $771,170.

Actually, as an appendix to the report shows, Forest City Ratner's contract went up, a 17.5% increase from $656,520. (Overall lobbying by FCR, however, decreased 45% from $2,105,141 to $1,160,186.)

The New York Public Interest Research Group (NYPIRG) issued a chart (above) that combined lobbying expenditures with campaign contributions. Forest City Ratner comes up zero in the latter. We know that may be true for 2007 but not for 2008, given the $58,420 contribution in January to the Democratic Assembly Campaign Committee's Housekeeping account.

And we know that the developer has other ways of currying favor, such as via the shadowy Forest City Ratner Companies Foundation.

In the Post

Yesterday's New York Post, in an article headlined (online) TEACHERS 'BUY' ALBANY: UNIONS DROP $3M TO LOBBY, focused on the "whopping $3 million" spent by the city and state teacher unions, a figure "revealed the day after the teachers unions successfully stymied a measure, backed by Mayor Bloomberg and Schools Chancellor Joel Klein, that would have allowed student-performance data to be used in determining teacher tenure."

The report, however, shows that the categories of Health & Mental Hygiene and Real Estate & Construction spent the most on lobbying.

Lower in the article:
The Trustees of Columbia University spent $2.3 million on lobbying state and city officials last year, the second highest total behind Verizon's $3.2 million.

And Forest City Ratner Companies, which is looking to build an arena for the NBA Nets in Brooklyn, spent $1.2 million on lobbying in New York last year, the eighth highest total.


It's a lot more than an arena, actually.

Note that, while the article above that I scanned is cut off, the graphic does include the Top Ten lobby clients, including Forest City Ratner.

In the Daily News

The New York Daily News took care of it in a Daily Politics post, headlined Big Bucks = Big Influence In Albany. It mentioned the top lobbying firms and the top three clients, but not Forest City Ratner.

It did link to the NYPIRG chart reproduced above, which includes Forest City Ratner.

On Brian Lehrer

As a guest on the Brian Lehrer Show yesterday, Blair Horner, legislative director for NYPIRG, offered comments on the report. Lehrer touched only briefly on Atlantic Yards, at about 1:50, as he went through the list, saying, mock-quizzically, "Number 8, Forest City Ratner, what could they possibly want--hmm?

At about 6:20, Lehrer asked Horner for general observations on where lobbying money goes.

Spending big bucks

Horner responded, "Typically, if you're spending big bucks, trying to influence opinion makers, they're spending it on well-connected lobbyists.... You're also spending it on different kinds of advertising, it could be polling, it could be direct mail pieces to individuals at the grassroots level, it could be TV ads....

So when you get into the big bucks categories like this, you have major things going on, well-connected lobbyists combined with some advertising activity and direct communications to membership or people they believe to be allied to them, and that's the typical modern-day lobbying activity that you see, the connection between the insiders as well as the kind of Internet-based and TV-based advertising efforts, radio-based, to drive the process. Clearly, they wouldn't spend all this money if they didn't think it worked."

Indeed, Forest City Ratner uses insiders, like Fried Frank lawyer Melanie Meyers, a former general counsel to the Department of City Planning, as well as a series of slick brochures (so far, seven), produced by a political consulting firm.

In the Times

Last year, the Times covered news of the annual report in its blog. This year, the Times has ignored it.

However, separate but similar information from Project Sunlight, a database created by Attorney General Andrew Cuomo's office, generated more extensive Times blog coverage and even an editorial last December.

Why was the latest report ignored? Was it because the Times already wrote about Project Sunlight? Was it that the Times considers itself a national newspaper, so such nitty-gritty information important to New Yorkers isn't so crucial? Or was there, as a reporter in the Gannett Albany bureau suggested, a question of timing:
It’s curious, though, that the highly criticized commission handed its annual report today—when most of the media is focused on the state budget and the report, which usually garners headlines, will be overshadowed.


Whatever the reason, the readers are underserved.

1 comment:

  1. The Forest City Ratner lobbying expenses (this year $1.160 Million) and the Columbia University lobbying expenses (this year $2.261 Million) should be viewed as a linked story. Together, the lobbying expenses come to $3.421 Million for this year and both lobbying campaigns involve the pursuit of eminent domain abuse windfall.

    While this AYR post points out Forest City Ratner’s relatively contemporaneous pursuit of a special 421-a tax break and a campaign for many additional subsidies for the Atlantic Yards megaproject (it still needs a variety of public approvals for the additional subsidies and other increases), the pursuit of eminent domain abuse windfall is a long term and ongoing process that requires support from public officials to win in the courts. Also, in the case of Atlantic Yards, the land captures through eminent domain abuse is what allows all the other subsidies (including an extraordinary density increase through a zoning override) to be multiplied and come out to extraordinary tallies (over 2-2.5 billion in taxpayer subsidies).

    Were it not for the multiplying effect of the eminent domain abuse windfalls the other subsidies might not be so ardently pursued with these lobbying monies.

    If you take the $3.421 Million that Forest City Ratner and Columbia are expending this year driven by the profit from eminent domain abuse windfall (add what other may be spending for Willet’s Point, etc.) and multiply it by all the years it takes to get the windfall, in the case of Atlantic Yards all the years heretofore and all the years yet to come, you get an idea of how economically attractive eminent domain abuse is. Remember there are other expenditures involved in pursuing the windfall, lawyers and professionals and the legal cases themselves. Forest City Ratner also lobbies to protect itself against eminent domain reform on the national level (national reform could also stop Atlantic Yards) and recently paid former Senator Al D’Amato’s lobbying firm $400,000 in connection with these efforts.

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