Thursday, January 22, 2015

As Assembly Speaker Silver faces arrest, the question arises: could that connect to Ratner?

The New York Times has a scoop, Sheldon Silver, New York Assembly Speaker, Faces Arrest on Corruption Charges:
Federal authorities are expected to arrest Sheldon Silver, the powerful speaker of the New York State Assembly, on corruption charges on Thursday, people with knowledge of the matter said. The case is likely to throw Albany into disarray at the beginning of a new session.
The investigation that led to the expected charges against Mr. Silver, a Democrat from the Lower East Side of Manhattan who has served as speaker for more than two decades, began after Gov. Andrew M. Cuomo in March abruptly shut down an anticorruption commission he had created in 2013.
Details of the specific charges to be brought against Mr. Silver were unclear on Wednesday night, but one of the people with knowledge of the matter said they stemmed from payments that Mr. Silver received from a small law firm that specializes in seeking reductions of New York City real estate taxes.
Could it reach Ratner?

And a reader already asked me: "How does the Silver corruption probe reach to Ratner? Not if, but how?"

The short answer, of course, is nobody knows. First, we can't be sure if any charges will stick.

Second, none of the clients of the law firm--at least the ones mentioned publicly--have anything to do with Forest City Ratner.

Then again, I did write, in my 2015 preview,  that "there are elected officials under indictment or investigation--state Sen. John Sampson and Assembly Speaker Sheldon Silver are the most obvious examples--who have ties, direct and indirect, to Forest City Ratner."

And if Silver is in fact caught red-handed, he might want to reduce his sentence by cooperating with prosecutors. As Phillip Anderson of The Albany Project put it:
Silver is old. He’s rich. And he’s been at the very nexus of Albany corruption for years. Silver knows where all the bodies are buried, so to speak. And it definitely looks like Bharara has the goods on him for real this time. Does Silver roll? Does he save his ass whilst doing an enormous public service to the State of New York and all of us who have suffered such corruption for so long?
I think we’re about to find out.
Silver and Ratner

So, how might Silver connect prosecutors to Ratner? Unclear. (Also, note that prosecutors tend to prioritize political corruption ahead of corporate malfeasance, which seems to be why Forest City was untouched in the Ridge Hill case in Yonkers.)

First, consider that what may seem unethical--such as Forest City Ratner's January 2008 "slush fund" contribution of $58,420 to the Silver-controlled Democratic Assembly Campaign Committee--is perfectly legal under New York law.

Was Silver's agreement in 2006 to approve state funding for Atlantic Yards as part of the Public Authorities Control Board greased by any unseemly Ratner promises? Not that we know of; Silver was reportedly most appreciative that there'd be little or no office space to compete with his Lower Manhattan district.

What about the legislature's 2007 approval of a "carve-out" that spared Atlantic Yards from reform of the 421-a law? That was supported by numerous other legislators and the Real Estate Board of New York. But we don't know.

Then there are connections to the recent grand larceny conviction of William Rapfogel, leader of the powerful Metropolitan Council on Jewish Poverty, and Silver's childhood friend. After all, the Met Council and Silver have honored Bruce Ratner, while Ratner hired Michael Rapfogel, a son of William Rapfogel and Judy Rapfogel, who just happens to be Silver's chief of staff.

"The [Michael Rapfogel] job was seen internally as a way to please Mr. Silver, say people familiar with the son’s work," the Times reported last year, though Forest City denied that. That Times article on the Seward Park Urban Renewal Area noted an unsuccessful plan in the early 1990s to direct the site to Ratner:
But months later, he and Mr. Rapfogel quietly put their weight behind yet another new plan, from a handpicked developer who included no housing. According to official memos, Mr. Silver asked city officials to approve a “big box” store, like Costco, on the site. The developer, Bruce Ratner, would build it. The sponsor would be the South Manhattan Development Corporation, which Mr. Rapfogel then headed.
Silver has been dealing with Ratner for a long time, but an unseemly alliance is not necessarily a crime. So that doesn't mean he has the goods on Ratner, or that what he knows about Ratner is more valuable than what he knows about other legislators.

But prosecutors, if successful in pursuing these initial charges against Silver, surely know there's much more to ask about Albany, the Lower East Side, and Silver's favorite developer in Brooklyn.

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