Stringer calls for abolition of member items in City Council; Daily News editorial points to importance of fairness in contracting

Manhattan Borough President Scott Stringer, who uses his office more as as policy shop than cheerleading Brooklyn Borough President Marty Markowitz, this week issued a report calling for the abolition of the favoritism-riddled system of member items in City Council.

The report is of course somewhat self-serving--it was seen as a slam on City Council President Christine Quinn, a rival to Stringer in the 2013 mayoral race, and Stringer never refused member items when serving in the state Assembly.

But it was embraced by at least two editorial pages, with one pointing out how the current system offends fairness--an observation that, as I describe below, could have been applied to a key episode in the Atlantic Yards process.

From the report:

As the new fiscal year begins, Manhattan Borough President Scott M. Stringer today released “Reforming Local Member Items in New York City,” a report recommending the abolition of the current system for allocating City Council member items. The analysis, the most comprehensive study to date, reveals deep inequities within the current system over the last four fiscal years and recommends that these taxpayer dollars—totaling $49.6 million in this year’s budget—should be transferred to mayoral agencies for distribution, to take politics out of the process.

“At a time of dwindling government resources, New York City must be committed to allocating tax dollars in a way that is transparent, equitable and free of political favoritism,” said Borough President Stringer. “Unfortunately the current system of distributing member items falls short on all these counts. It’s time to reform this process once and for all.”

Member items are annual grants, also known as discretionary funds, distributed by City Council members each year to non-profit organizations and other local groups in each Council District. In the current fiscal year, $49.6 million in member items were allocated to some 4,335 organizations. Each Council District received a baseline sum of $260,464 to spend on youth and senior services as part of that $33 million. Anything above that sum was awarded at the discretion of the Speaker’s Office.

Under the current system, some districts receive more than four times the amount of discretionary member items than others. The Borough President’s report notes that the adoption of a uniform, across-the-board distribution of member items would have given added funding to 32 districts across the city.

Regrettably, New York’s system has also led to abuses: Some elected officials have steered tax dollars to charities that employed friends or relatives, or otherwise used the system to enhance their financial or political standing. The report also notes that New York City stands alone when it comes to member items: The Borough President’s Office researched the nine other largest cities in the country and found that no other municipality grants individual legislators so much leeway to distribute tax dollars at their discretion, or on such a large scale.

From the New York Post

The Post, in Stringer's slush slam, wrote:

At least someone gets it.

Manhattan Borough President Scott Stringer, echoing The Post's long-held view, issued a report yesterday calling for an end to the City Council's "member item" system.

That's the $49 million slush fund with which council members buy loyalty, support and votes -- and, too often, line their own pockets.

"At a time of dwindling government resources," said Stringer, "New York City must be more committed than ever to allocating tax dollars in a way that is transparent, equitable and free of political favoritism."

And, we might add, provides better protection from corrupt pols.

From the Daily News

From today's editorial, City Council's corrupt member-item system creates inequities in distribution of grants, contracts:

When city government puts contracts or grants out to bid, New Yorkers have every right to expect that all qualified applicants will have the same chance of winning an award.

That's how things work - except in the City Council.

There, Speaker Christine Quinn and her members only pretend that everyone who applies for so-called member item funding - for Little Leagues, senior centers and other local programs - has an equal shot at success.

In fact, as far as the Council is concerned, some New Yorkers are much more equal than others.

Those who live in districts represented by Quinn's allies bring home far more money than do members who have broken ranks with the speaker. And the needs of any particular community are irrelevant as the speaker divides a $50 million annual pie.

Actually, in the case of the Metropolitan Transportation Authority's Vanderbilt Yard, the agency worked exclusively with developer Forest City Ratner for well over a year, then in 2005 issuing a brief and belated Request for Proposals that drew only one response, from a developer, Extell, that had been solicited by Atlantic Yards opponents, Develop Don't Destroy Brooklyn.

Had there been a fair starting point, surely multiple developers would have bid, as with Hudson Yards in Manhattan.

It's not too convenient, however, for the Daily News to notice that, because the Daily News has long been cheerleading for Atlantic Yards.

What's wrong with the system

From Stringer's report:

Per Constituent Disparities: The Borough President’s analysis found significant disparities in per constituent member item allocations across New York City’s 51 Council Districts, which have roughly equal populations. In one district in Brooklyn, for instance, the member item allocation equaled $10.30 per constituent, the highest in the Council in FY 12. That is nearly five times more than the $2.37 per constituent received in another district in the same borough.

Widening Gap: In recent years, the disparities have grown worse, not better. In FY 2009, the gap between the Council District receiving the least amount of member item dollars and the most was $904,500. Today, that gap has stretched to $1.3 million..

Geographic Fault Lines: Underscoring disbursement disparities on a per constituent basis, the Borough President’s analysis found numerous geographic “fault lines” between districts that literally border each other. . In Brooklyn, for instance, one of the most richly rewarded districts this fiscal year received $1,235,464 in FY 12, or about three times more than the District right next door which received only $471,464, despite having a significantly lower median household income.

No Relationship to Need: Beyond simple district-by-district comparisons, the Borough President’s Office used a basic linear correlation to demonstrate that there is no statistical relationship between a Council District’s need and its member item allocation. [1]

...The report recommends that the current system of member items should be abolished in New York City. Instead, those funds should be transferred to mayoral agencies for distribution as Community Grants.

As a starting point, the Mayor’s Office of Contract Services (MOCS) should convene a working group of diverse elected leaders, good government groups and non-profit representatives to develop a new process for awarding Community Grants. The working group’s process should provide for a number of criteria including but not limited to:

• A baseline allocation for Community Grant funding that guarantees a set level of support to non-profit service providers each year.
• A formula that assures Community Grants are distributed on an equal basis across all 51 Council Districts, or through an empirical, needs-based formula that targets areas of greatest economic need.
• A process that recognizes the importance of small community organizations and ensures the opportunity for their participation, as well as limits on how much any one organization can receive.
• Appropriate mechanisms for incorporating input from local elected officials, community leaders and stakeholders.

Whatever system MOCS develops for distributing member item dollars should apply equally to Borough Presidents.

In the absence of a total reorganization of the member items process, the City Council should adopt a system in which member items are distributed equally to each district, or adopt a formula-based approach that takes into account each individual district’s economic need. The federal government already uses similarly progressive, needs-based formulas to distribute anti-poverty funds.

While Stringer makes a compelling point that the system is unfair--and, as noted in the Post, his report says, New York is the only one of the country's ten largest cities that "grants individual legislators such broad authority to make funding decisions"--the idea of turning it all over to a strong mayor has raised a few eyebrows.

Illustrating the problem

The Daily News pointed to this:

Consider two councilmen - Domenic Recchia and Charles Barron - who were elected in Brooklyn districts located fairly close to each other.

Recchia is a Quinn lieutenant and chairman of the Finance Committee. He represents Coney Island, Bensonhurst, Brighton Beach and Gravesend. This year, he distributed $1,630,064 to groups such as the Brighton Ballet Theater Company, the Russian American Foundation and the Brooklyn Chinese-American Association. His total amounted to $10.30 per resident.

Barron is a self-styled civil rights firebrand who has attacked Quinn's leadership. He represents East New York, Brownsville and Canarsie and was permitted to deliver less than a quarter of Recchia's sum to groups in his neighborhood: $399,464, or $2.40 per person.

Not that it was germane to the distribution of funds, but guess which Council Member supported Atlantic Yards, and which one did not? Right.

James below average

In fiscal year 2012, Council Districts received an average of $638,479. City Council Member Letitia James, serving her second full term (plus part of the late Council Member James Davis's unfinished term), has seniority, but not an in with Quinn.

So in 2012, James's 35th District received $481,964.00, ranking 37th among 51 Council Districts.

2011 07 Xx Christine Quinn Slush Fund Member Items Report