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Cuomo Threatens Subpoenas in Bid for Public Campaign Financing

Photographer: Mario Tama/Getty Images

For New York Governor Andrew Cuomo, who faces re-election in 2014 and has been mentioned as possible presidential candidate, the latest corruption allegations risk derailing his legislative agenda. Close

For New York Governor Andrew Cuomo, who faces re-election in 2014 and has been... Read More

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Photographer: Mario Tama/Getty Images

For New York Governor Andrew Cuomo, who faces re-election in 2014 and has been mentioned as possible presidential candidate, the latest corruption allegations risk derailing his legislative agenda.

New York Governor Andrew Cuomo wants to break the connection between cash and politics that’s led to corruption in Albany for decades, and he says public financing of election campaigns is the solution.

He’s giving lawmakers a choice: Either they agree to it or he’ll form an executive commission with subpoena power to root out graft. The arrests over the past few weeks of two senators and an assemblyman, all Democrats from the New York City area, highlighted an issue that the governor has vowed to tackle since his days as state attorney general.

Republicans oppose public funding, and Cuomo, a 55-year-old Democrat, says that if they don’t relent he’ll authorize a commission under the 1907 Moreland Act, which gives a New York governor broad investigative powers. Cuomo delivered the same threat in 2011 to get lawmakers to create an ethics-enforcement unit with investigatory powers and expand financial-disclosure requirements.

“If the Moreland Commission is what it takes to get senate Republicans to pass public financing, then so be it,” said Stephen Pampinella, a spokesman for FAIR Elections for New York, a group that backs Cuomo’s planned changes. “The difference between the legalized bribery that’s campaign finance and the bribery cases we’re seeing is a very fine line.”

‘Scandal Mania’

For Cuomo, who faces re-election in 2014 and has been mentioned as possible presidential candidate, the latest corruption allegations risk derailing his legislative agenda. In a radio interview this week, he said he hoped “scandal mania” in Albany won’t thwart his push to create an advisory board for struggling upstate municipalities, expand abortion rights and build casinos north of Manhattan.

“Scandal mania can paralyze,” said Hank Sheinkopf, a Democratic political consultant based in New York City. “It becomes a question of what people are focused on and how much time it’ll take to deal with scandals against how much time will be spent dealing with programs.”

The public-funding option, which would be modeled after New York City’s program, is at the heart of Cuomo’s plans to overhaul the campaign-finance system and create laws to make it easier for state and local prosecutors to target corrupt officials. In the past, most corruption cases involving state lawmakers have been handled by federal authorities.

NYC System

To be eligible for public financing in New York City, mayoral candidates must raise at least $250,000 in contributions of $175 or less. The city allocates $6 for every $1 collected.

The program also requires participants to limit spending. For example, mayoral candidates aren’t allowed to spend more than $6.4 million in a general election. Most candidates in this year’s race, including frontrunner Christine Quinn, the city council speaker, have said they will accept public funding.

New York Mayor Michael Bloomberg, a billionaire, financed his own campaigns. The mayor, who is barred from seeking a fourth term, is the founder and majority owner of Bloomberg News parent Bloomberg LP.

Applying public financing at the state level has been the subject of lobbying efforts in Albany this year by government watchdog groups, including Citizen Action of New York and Common Cause.

Democrats in the legislature, who hold a majority, have backed similar measures. Republicans, who have power in the senate thanks to four breakaway Democrats, say they’ll block a vote on the bill, which could cost as much as $286 million next year, according to Senator Dean Skelos, the Long Island Republican who co-leads the chamber.

Skelos Opposition

“New York needs more disclosure and better enforcement of existing campaign-finance law violations, but we don’t need taxpayer-funded political campaigns,” Skelos wrote in an article published May 13 in the Albany Times Union newspaper. “It’s a terrible idea for taxpayers. It’s a terrible idea for our state.”

That’s a difficult obstacle to overcome, even with the looming threat of a Moreland Commission, Cuomo said.

“It is a philosophical problem,” he said at a May 8 press briefing in the capital. “Senate Republicans don’t believe in it, they don’t agree with it, they don’t find a need for it.”

The corruption issue has overshadowed some of the governor’s accomplishments, including a post-budget victory tour. On April 2, the day after the start of his third on-time spending plan -- a feat not achieved since 1984 -- Senator Malcolm Smith, a Queens Democrat, was accused by federal prosecutors of trying to bribe his way onto the New York City Republican mayoral ticket.

Show Me

“A show-me-the-money culture seems to pervade every level of New York government,” Manhattan U.S. Attorney Preet Bharara said in a statement after Smith’s arrest.

In the weeks since, a Democratic senator from Brooklyn and a Democratic assemblyman from the Bronx were accused in separate corruption cases.

Meanwhile, a subcontractor for a $415,000 lake house built by Senator Tom Libous, the Republican from Binghamton who heads his party’s election committee, said the Federal Bureau of Investigation spoke with him in March about his work there.

The circumstances were similar when Cuomo, the son of former Governor Mario Cuomo, came to Albany in 2011 with a pledge to clean it up.

Kickbacks, Prostitutes

Alan Hevesi, a Democrat who as comptroller was the sole trustee of the state’s pension fund, pleaded guilty in October 2010 to approving a $250 million pension investment in exchange for a $1 million kickback. Democratic Governor Eliot Spitzer resigned amid a prostitution scandal, and in March 2011 Senator Carl Kruger, a Democrat, was accused of taking payoffs. He was sentenced to seven years in prison.

Former Senate Majority Leader Joseph Bruno, a Republican, was accused last year by federal prosecutors of taking a bribe after a previous conviction on corruption charges was thrown out in 2011. He pleaded not guilty.

Kruger’s arrest prompted Cuomo’s Moreland threat, which resulted in legislative approval of the Joint Commission on Public Ethics, an investigatory unit that has been criticized by watchdog groups for being secretive. This week, lawmakers filed their first expanded financial disclosures, which they agreed to after Cuomo warned of a commission.

Now he’s at it again.

“I’m not willing to let the session conclude without a response to what has come up,” Cuomo said May 8. “I want people to pass a reform package. If they don’t, there are other options that I can consider. One of them is a Moreland Commission.”

The panel wouldn’t start until after the legislative session ends June 20, Cuomo has said. That would mean lawmakers, who aren’t scheduled to return to Albany until January, would face months of public scrutiny, said Charlie Albanetti, a spokesman for Citizen Action of New York.

“If any lawmakers refuse to support the financing system, the people of New York will be the deciders in the end,” Albanetti said. “The threat of the governor won’t necessarily be the problem. It’s the threat of people outraged by corruption in Albany.”

To contact the reporter on this story: Freeman Klopott in Albany, New York, at fklopott@bloomberg.net

To contact the editor responsible for this story: Stephen Merelman at smerelman@bloomberg.net

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