MDC shares an article from the Broadheet. MDC has stated numerous times over the decades about the corruption that exists in Battery Park City. The quality of life decisions are all about financial gain for the board that are completely out of touch and unfortunately the residents suffer.
MDC offers to sponsor a class action lawsuit……more blatant evidence on the corruption.
Today, at its 9:00 am board meeting, the Battery Park City Authority (BPCA) is expected to give control of North Cove Marina, which is legally mapped as parkland, to real estate developer Brookfield Properties, a firm that contributed more than $250,000 to the recent reelection campaign of Governor Andrew Cuomo (who oversees the BPCA).
Brookfield (which has no experience in running marinas) is believed to have partnered with Island Global Yachting, a firm that specializes in luxury anchorages for very large private vessels, owned by clients whose personal net worth is measured in nine figures. (BPCA chair Dennis Mehiel has acknowledged using IGY marinas for his own, 148-foot yacht.) IGY founder and owner Andrew Farkas (a billionaire real estate developer) was also among the largest contributors to Mr. Cuomo’s recent campaign for reelection.
Mr. Mehiel’s position as a customer of IGY (which bears some similarity to that of another BPCA board member, who recused herself from voting on the North Cove contract because she had paid to keep a boat at North Cove Marina) has given rise to concerns about a possible conflict of interest. In spite of this, Mr. Mehiel has apparently decided not to recuse himself, but the BPCA has refused to answer questions about how he arrived at this decision.
The State’s Joint Commission on Professional Ethics (JCOPE) is the body that rules on conflicts of interest for public officials. A JCOPE spokesman did not respond to a request for comment about whether Mr. Mehiel had a possible conflict of interest in the North Cove contract, or whether he had consulted JCOPE on this matter. JCOPE is led chairman Daniel Horowitz, who is the husband of BPCA president Shari Hyman.
A sign of broad dissatisfaction with what appears to be the BPCA’s likely move, Manhattan Borough President Gale Brewer has taken the unusual step of announcing that she will attend Thursday’s BPCA board meeting. “I believe the Battery Park City Authority’s original Request for Proposals process for marina operators was flawed,” she told the Broadsheet, “and needs to be reopened with more emphasis on the community’s needs and more room for the community to be involved. That’s what I’ll be telling them at their board meeting on Thursday.”
Among the widespread misgivings about the process are concerns about the standing of various members of BPCA’s board to vote on the North Cove contract, or their broader eligibility to serve on the Authority’s board at all. One member, Frank Branchini, was recently revealed have changed his residence to New Jersey three years ago. According to a public notice from the BPCA, Mr. Branchini will be participating in Thursday’s meeting via videoconference from another of his homes, in Florida.
Another director, Martha Gallo (the only member of the BPCA board who lives in Battery Park City), has recused herself from voting on the North Cove contract. Ms. Gallo made this determination in what may have been an attempt to avoid even the appearance of a conflict of interest. Her decision seems to have been driven by the fact that she has paid the current operator of North Cove Marina, local resident and small businessman Michael Fortenbaugh, to moor a boat there, and has also been a member of a sailing club that Mr. Fortenbaugh operates.
A third member, chairman Dennis Mehiel has similarly paid another bidder, Island Global Yachting (IGY), to utilize three marinas that company owns in the Caribbean for his private yacht. IGY, which specializes in luxury marinas for so-called “super yachts,” has partnered with Brookfield on that company’s bid to take control of North Cove. (Brookfield itself has no experience in managing marinas.) But Mr. Mehiel has declined to recuse himself from voting on the North Cove contract.
The BPCA declined to explain the reasoning behind Mr. Mehiel’s decision, and refused to clarify whether this determination was made on the advice of an attorney who specializes conflict-of-interest cases, or was based on his own judgement. (Mr. Mehiel is not an attorney.) In Mr. Mehiel’s communications with the Broadsheet, he did not mention having consulted an ethics lawyer, saying instead, “I don’t see an analogy between Martha’s connection to the Yacht Club and Helios at a marina in the Caribbean. It seems like a pretty big stretch to me, particularly given the protocol followed by the Authority.”
Aside from the symmetry in the positions of two BPCA board members paying two separate bidders for services, the primary contrast in the situations (apart from one member recusing herself and the other declining to) appears to be the amount of money involved in their respective transactions with the different bidders. North Cove Marina charges approximately $14,000 per year to moor a boat of the size that Ms. Gallo kept there, and a membership in the sailing club costs $1,500. This yields a total of less than $16,000.
Mr. Mehiel’s personal yacht, Helios, is 148 feet long, so large that carries onboard two motorboats, an 18-foot sailboat, two underwater scooters, and a pair of two-person kayaks, as well as three lifeboats capable of holding a total of 48 people. (When Mr. Mehiel is not using Helios, he rents it out for approximately $150,000 per week.) A boat of this size necessarily uses massive amounts of fuel, and the gasoline tank aboard Helios holds approximately 8,200 gallons. With the price of marine fuel currently fluctuating between $4 and $6 per gallon, filling this tank at an IGY marina would cost more than $32,000. Berthing a yacht the size of Helios at an IGY marina can also cost more than $8,000 per week. A 2011 study by consultants Engel & Völkers found that an IGY facility in the U.S. Virgin Islands, Yacht Haven Grande on St. Thomas (one of the three IGY marinas that Mr. Mehiel acknowledges using), was the tenth-most expensive marina in the world.
While the Broadsheet has not obtained detailed records of financial transactions for Helios, it appears that even short-term stays or occasional purchases of fuel at IGY facilities would yield a total payment by Mr. Mehiel to IGY far in excess of any payment by Ms. Gallo to the current operator of North Cove Marina. The BPCA refused to clarify the seeming disparity between one board member recusing herself because lower-value transactions, while another board member declined to recuse himself over higher-value transactions.
While there has been no allegation of impropriety on Mr. Mehiel’s part, the law that governs such situations appears to require more than the absence of wrongdoing. Section 74 of the Public Officers law, in the subdivision that deals with conflicts of interest, states, in part, that, “an officer or employee of a state agency . . . should endeavor to pursue a course of conduct which will not raise suspicion among the public that he is likely to be engaged in acts that are in violation of his trust.” The same passage continues, “an officer or employee of a state agency . . . should not by his conduct give reasonable basis for the impression that any person can improperly influence him or unduly enjoy his favor in the performance of his official duties, or that he is affected by the kinship, rank, position or influence of any party or person.”
Among the concerns voiced by critics of the North Cove bidding process has been the fact that IGY’s founder and owner, Andrew Farkas, was one of the biggest donors to Governor Andrew Cuomo’s recent campaign for reelection. Governor Cuomo directly oversees the BPCA, and appoints all of its board members.
“Whether or not there has been any actual impropriety is entirely beside the point,” says Jared Sheer, a lawyer who has lived in Battery Park City for three years. “For Dennis Mehiel not to recognize the potential conflict of interest is shocking. For him not to recognize the parallels between himself and the other board member is shocking. Dennis Mehiel must recuse himself. Anybody having any type of personal or professional ties to any of these bidders should recuse themselves.”
“In the normal course of events, small businesses unfortunately sometimes get pushed aside,” Mr. Sheer continues. “But these are questions about the board’s ties to a bidder who appears likely to win the contract. For them not to have even considered that Mehiel’s boat had any interaction with that company rings false to me. There seems to be a basic lack of fairness here. And a basic lack of transparency.”
“I have no vested interest personally,” Mr. Sheer reflects. “I live here, but I don’t have a boat, nor do I intend to use one. In other words, I haven’t had a particular reason to care who winds up with the winning bid.”
“But ultimately,” says Mr. Sheer, “it’s a question of whose interests the board is supposed to have in mind. They are agents of the state, appointed by the governor. So they are supposed to be representing the interests of the public. As residents, we all pay [ground rent] that allows us to live in this unique neighborhood. We deserve our best interests to be kept in mind as the neighborhood is governed. But this whole ugly situation raises serious questions about whether this board is positioned to do so.”
“It is essential that the BPCA preserve its integrity and the confidence of the Battery Park City community,” says Jenifer Rajkumar, a Battery Park City resident who also holds the elected post of District Leader for Lower Manhattan, and who has been a leading critic of the North Cove bidding process. “Over the past weeks, several issues have come to light which raise serious questions concerning the legitimacy of the entire process by which the BPCA has sought to award a lease for North Cove Marina. While these issues apparently have yet to be resolved, the BPCA would do well to reexamine its approach and to reopen the process so that there remain no questions as to the appropriateness and legality of what has occurred. Only in that manner can the BPCA ensure that it has fulfilled its mandate to conduct an open, honest and transparent selection process.”
The meeting at which the BPCA’s board is expected to vote on designating a new manager for North Cove Marina is scheduled for tomorrow (Thursday, January 22). This meeting, which is open to the public, will be held at the BPCA offices (200 Liberty Street, 24th floor) and begins at 9:00 am.
Source: broadsheet by Matthew Fentton