Thursday, March 19, 2009

Under fire, Finance Commissioner Stark gives up moonlighting job; won't talk about conflict-of-interest situation

In October, New York City Finance Commissioner Martha Stark seemed unflappable when she testified before a Congressional subcommittee regarding the valuations for the Yankee Stadium site, valuations that critics believed were "gamed" to ensure sufficient PILOTs (payments in lieu of taxes) to repay construction bonds.

Despite Stark's confidence, there was still a big gap between her explanation that, when choosing comparable sites for an assessment, the first priority is proximity, and the city's practice, which included a vastly non-comparable site in Alphabet City, more than seven miles away.

Should the Atlantic Yards arena proceed, Stark's department will have a crucial role in ensuring an assessment commensurate with the bonds. This week, there are new reasons to question Stark's judgment and integrity.

Moonlighting

Last Sunday, the New York Post had a scoop. In an article headlined COMMISH A 'TWO-TIMER': REAL-ESTATE SIDE GIG SECRETLY OK'D BY CITY, the Post reported that, while department heads are forbidden to take outside jobs, Stark earned some $134,000 in two years as a board member for an apartment company called Tarragon, which does not operate in the city.

(Graphic from New York Post)

The mayor's office was surprised, but Stark's office "released a confidential April 11, 2005, letter from Steven Rosenfeld, chairman of the city's Conflicts of Interest Board, saying her work for Tarragon 'would not violate' city rules," as long as she recused herself from any city matter involving Tarragon or its officers or shareholders, among other restrictions.

Tarragon's CEO told the Post that the four board meetings and audit committee meeting total only about ten hours a year, William Friedman, and a DOF spokesman Owen Stone said that work was not within Stark's required 35-hour week.

Fishy situation

That sounded fishy, and it was. In a New York Times article Monday headlined City Finance Official Resigns Seat on a Developer’s Board, Citing Publicity, the New York Times reported that Stark had been told by the city's Law Department that four meetings a year would not be a problem, but that the board had 16 meetings in 2007.

Beyond that, Tarragon’s CEO said that a task force for which Stark gained $64,000 required extra work, “never more than five hours in one week.”

The New York Post added, in an article Monday headlined DOUBLE-DIP NIPPED that "Stark did not disclose her Tarragon position or pay on public financial disclosure forms filed with the COIB [Conflicts of Interests Board] until 2008."

The parking judge

Yesterday, in an article headlined Parking Judge to Be Reassigned After Conflict-of-Interest Allegation, the New York Times reported that Stark had been warned by the Department of Investigation (DOI) that "a senior parking ticket judge who is married to the agency’s first deputy commissioner had billed for office hours when he was not present."

Stark took no action, because Judge Allan Patricof, according to her review, had worked those hours, just not in his office but at home and elsewhere. But city investigators said that the judge "had been an intimidating presence in the agency," the Times reported, even as Stark resisted those concerns.

The DOI stated, "Although the Department of Finance felt his conduct never warranted disciplinary action, we understand that he will now be leaving the Department of Finance, which is consistent with our recommendation and appropriate under the circumstances.”

Stark would not respond to the Times's requests for comment.

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