Monday, April 06, 2015

On NY1, reporters sift through BerlinRosen suspicion; a look back at how firm massaged Ratner's bailout of ACORN

Last Friday, in NY1 Online: Reporters Weigh In on BerlinRosen's Influence on City Hall, host Errol Louis discussed reporter Grace Rauh's exclusive story about the PR firm BerlinRosen's influence on City Hall and more with a panel. (Also see commentary from journalist/consultant Gary Tilzer, who's long beat the drum on this issue.)

Louis asked if this was the new normal, and whether this seeming loophole--in which firms seem to act like lobbyists but don't have to disclose their work--can continue.

"It can," responded columnist Chris Smith of New York Magazine. "There is talk about changing the law... we don't know what's being discussed, who the clients are, it may all be innocent. But when you have someone who's been close to the mayor for decades, helped him get elected, who's now got clients doing business, trying to get things passed by city government, there's a lot of potential for conflict."

Unmentioned but a clear example is Berlin Rosen's tri-partite work for ACORN, Forest City Ratner, and Mayor Bill de Blasio, all allies on Atlantic Yards/Pacific Park. (Note this tweet from Chris Bragg, formerly of Crain's, who said: "FWIW: Spent months looking @ possible unreported lobbying, including @BerlinRosen. In fairness, no one could cite any evidence they did this.")

Laura Nahmias of Capital New York told Louis that this system is typical in Albany, with "an entire class of people moving through the shadows," with no one forcing disclosures.

Reasons for skepticism

Louis observed that it wasn't clear who would enforce such transparency, and what the penalties would be. In the case of Berlin Rosen, "it wouldn't be Attorney General Eric Schneiderman, they helped elect him." (Note that Bruce Ratner has also given generously to Schneiderman's campaign.)

Juan Manuel Benitez of NY1 Noticias noted that de Blasio talks about transparency, but refused to answer Rauh's question about Berlin Rosen at a press conference.

Louis himself acknowledged some doubts, saying that it was "startling" that, in his interview with Patrick Markee of the Coalition for the Homeless--also a Berlin Rosen client--"they seemed to go out of the way to blame record high homelessness on everybody but the mayor.... Maybe we've got advocates who are not quite the independent advocates we're used to seeing." (Note: Markee is married to journalist Lizzy Ratner, a daughter of Bruce Ratner.)

It's good that Louis is skeptical, but keep in mind that he now occupies a more neutral position than he did when he wrote a column for the Daily News. In May 2006, as I wrote, a column about neighborhood support for Atlantic Yards failed to mention how three of the five people mentioned were associated with signatories to the Atlantic Yards Community Benefits Agreement.

WNYC's Brigid Bergin noted that these consultants are "ubiquitous" and taken for granted.

A look back at a Berlin Rosen success: massaging Ratner's ACORN bailout

In 2008, national ACORN--the larger parent of New York ACORN, which signed a Community Benefits Agreement and Housing Memorandum of Understanding with Forest City Ratner--faced a big hit to its reputation.

For eight years, founder Wade Rathke had covered covered up a $1 million embezzlement by his brother Dale Rathke. As the Times reported September 10, 2008, the news was “concealed by senior executives until a whistle-blower told a foundation leader about it in May.”

Noting that the money had been paid back, “Rathke's misjudgment in covering up his brother's embezzlement has now provided ACORN's opponents with ammunition to attack the organization,” wrote two ACORN defenders in The Huffington Post

ACORN’s antagonists extended beyond the right wing, which was attacking ACORN for purported deception in voter registration, the authors suggested, citing critics on the left who were either jealous or disliked “ACORN's tactics or its willingness to forge compromises in order to win victories for its members.” 

One such compromise was about to pay off, as Wade Rathke stepped down and, from New York, Bertha Lewis stepped up. “In a shrewd move to consolidate support for her candidacy as the chief staff member of ACORN, [Lewis] negotiated a combination deal with Ratner to prove her fundraising prowess,” Rathke explained years later.

“With the voter registration crises swirling around ACORN, Bertha pulled the one string where she had leverage from her New York base—damn the torpedoes—realizing that Brooklyn was so polarized around Atlantic Yards and ACORN that it would hardly matter much more," Rathke continued, "and the likely criticism was secondary to her desperate need for bridge money while she waited for funders to grow a backbone.”

No one, however, knew about that deal until an angry former ACORN staffer, Anita MonCrief, revealed to me that Forest City had agreed to provide a $1 million low-interest loan—with onerous terms if late—and a $500,000 gift. 

In New York, ACORN spokesman Jonathan Rosen, of the firm BerlinRosen, tried to deflect the story, which I broke in early December. “This is old news," he said of the bailout. "We have confirmed this to multiple media outlets over the past few months.” 

Actually, no article had been published, though MonCrief revealed that Lewis had confirmed it to the Times, which had covered the embezzlement but not the bailout. So Rosen had been very effective.

As I wrote, the news should have made the Times, since it was just as big as the Dale Rathke story. Nearly a year later, the Times finally backed into the story, mentioning the bailout parenthetically.

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