Case closed (more or less): yes, ESDC volunteer Rahm was in charge of Atlantic Yards, serving at times as a sole contact person for FCR officials

Rumors that the Empire State Development Corporation (ESDC) will soon announce a new staffer as Atlantic Yards project manager make the below account especially timely.

Documents unearthed via a long-lingering response to a Freedom of Information Law (FOIL) request offer strong evidence, if not definitive confirmation, that a below-the-radar volunteer was, during a crucial period, the ESDC's leading overseer of Atlantic Yards.

After all, lawyer Susan Rahm (below, in the audience at the 5/29/09 state Senate oversight hearing) was the sole recipient at least once of key communications from developer Forest City Ratner.

Disputed takes

As I wrote 6/2/09, there was evidence that suggested Rahm, a several-days-a-week volunteer since the summer of 2007, was running the show, a highly unusual position, given that the state agency had no other volunteers.

I had questioned whether Rahm was in a policy-making position, and was told by the ESDC that no, she was just a consultant.

Another person intersecting with Atlantic Yards disagreed. "When I was introduced to Susan Rahm, she was called the 'project manager' for Atlantic Yards," my correspondent told me. "Yeah, it’s a pretty general term, but I got the impression she was the chief operating official for the project, salary or no."

Rahm left her role in the second half of 2009, some two years after she signed on, but after Forest City Ratner and the ESDC had revised the General Project Plan and granted Forest City Ratner more flexibility.

(Photo copyright Jonathan Barkey)

What's wrong with a volunteer?

A volunteer may offer expertise at a bargain, so they're not unknown in government.

As I wrote, I couldn't find any state guidelines about the role of volunteers. Nor could I get formal comment from any government watchdog groups about such a situation, though one representative, commenting generally, suggested that any level of concern would depend on the significance of the person's policy-making role.

Rahm, according to ESDC spokesman Warner Johnston, had no policy-making position, thus not triggering a requirement to file a financial disclosure form under the Public Officers Law.

Except, as I suggested, maybe she does help make policy. Indeed, documents received via the FOIL request confirm that.

Beyond policy is the issue of loyalty. To whom is a volunteer responsible--the governor who got her on board in order to move the project along? The agency itself? The project and its constituency? The public?

Ideally, everyone at the ESDC--from staff to board--owes a fiduciary duty, or its equivalent, to the public.

However, as we've seen in a state task force report on public authority reform, it's unclear that board members recognize they owe loyalty to the public ahead of the person who appointed them. I suspect similar challenges faced a volunteer like Rahm.

The FOIL request

On 4/20/09, I filed a Freedom of Information Law (FOIL) request with the ESDC, asking in part:

I request records that explain 1) how Susan Rahm's role and responsibility was introduced to ESDC colleagues when she joined ESDC as a volunteer in 2007 and 2) direct contacts by Rahm and/or Darren Bloch from 2007-present with Forest City Ratner executives regarding such issues as the timing, financing, legal status and scope of the Atlantic Yards project.

For months I got the same boilerplate response: they were diligently searching for records. The response took well over a year.

An ESDC response mailed to me on 6/25/10 indicated that there were 474 pages of information responsive to my request. But there were none that answered the first question, as far as I could tell when I later went through the records.

That suggests either nothing was put in writing or nothing was delivered to me.

Close contact

But the responses to question 2 did suggest a pattern of significant responsibility for Rahm and close contact with the developer, even if they said little about Rahm's analysis of the project.

A 7/17/07 memorandum (cover page, right), titled "Atlantic Yards Critical Path Items," from Forest City Ratner executive MaryAnne Gilmartin, was sent solely to Rahm and Downstate President Avi Schick.

(Click on graphics to enlarge)

A 5/9/08 email from a Forest City Ratner official, informing the ESDC of a full-page ad that the developer ran for Building 1, was sent to Rahm and Senior Counsel Steve Matlin.

In public events such as the 7/22/09 informational meeting on Atlantic Yards, Matlin was the agency's chief spokesperson.

A 6/23/08 email from Gilmartin, congratulating the ESDC for surviving a potential U.S. Supreme Court appeal, was sent to Rahm, Matlin, General Counsel Anita Laremont, and Schick.

A formal request

Perhaps most tellingly, and in contrast with the informal, friendly tone of most emails, Rahm was the sole ESDC recipient of a formal, blunt 12/9/08 request from Gilmartin (left) that the ESDC convey state funds promised but not delivered to the developer.

A 2/13/09 email from Gilmartin to the ESDC, giving the agency a head's up on the announcement of an extension of the loan from Gramercy Capital, was sent to Rahm, Matlin, and then-CEO Marisa Lago.

Rahm and Matlin also were the only ESDC officials on the receiving end of several memos about the emerging contours of the Development Agreement.

Adding it up

Was Rahm in charge? It sure looks that way, though obviously she shared responsibility with Matlin and their superiors.

The question now: is anyone in charge? (And who might be coming?)

And if the rather vague and weak Atlantic Yards governance bill, now pending, is passed, will it set up a structure with real oversight?