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March 11, 2011
KRUGERPALOOZA!
The headlines are awash today with the indictments of State Senator (and big Atlantic Yards booster) Carl Kruger and his not-so-trusty sidekick (and paid Atlantic Yards lobbyist) Richard Lipsky, and of course, "Real Estate Developer #1."
The New York Times, Developer Among Cast of Characters in Kruger Case
A corruption case unsealed on Thursday included a large cast of characters beyond State Senator Carl Kruger, Assemblyman William F. Boyland Jr. and six others who were charged.
Also highlighted in the criminal complaint was “a significant real estate development firm,” identified as “Real Estate Developer No. 1,” that was “spearheading an over $4 billion, multiyear, mixed-use commercial and residential development project in Brooklyn.” The description left little doubt that the firm was Forest City Ratner, the developer behind the Atlantic Yards project, a 22-acre residential and retail complex in Brooklyn that includes a new home for the Nets.
It was the second time in less than two years that the company played a role in a corruption case, though it was not charged either time.
The complaint accused Mr. Kruger, a Brooklyn Democrat, of taking at least $1 million in bribes in exchange for help on state matters, including bribes from Richard Lipsky, a lobbyist for Forest City Ratner, and other clients.
The complaint said the company’s “vice president of governmental affairs and public relations” — Bruce R. Bender has that role at Forest City Ratner — had asked Mr. Kruger last December for state money for three projects: $9 million for the Carlton Avenue Bridge, which is to be replaced as part of the Atlantic Yards project; $2 million for a retail development in the Mill Basin neighborhood of Brooklyn; and $4 million for the renovation of the skating rink in Prospect Park, a public project.
Mr. Bender’s wife, Amy Bender, is on the board of the Prospect Park Alliance, the park’s fund-raising group.
...[Forest City spokesman Joe] DePlasco said the company ended its relationship with Mr. Lipsky on Wednesday, when word of the case began to leak out, because of the “serious nature of the charges.” Forest City Ratner was the development partner of The New York Times Company on its Midtown headquarters.
Although the complaint contained no evidence that Mr. Bender believed Mr. Kruger was taking bribes, longtime opponents of Atlantic Yards were dismayed that no one from the company had been charged.
“I find it sad that politicians are expendable, but rich developers are not,” said Candace Carponter, the legal director of the group Develop Don’t Destroy Brooklyn.
Atlantic Yards Report, Two unanswered questions in the Kruger case: Does the ESDC still trust FCR? Why did FCR try to get the state to pay for its bridge obligation?
The New York Times, to its partial credit, follows up on the charges against Carl Kruger and Richard Lipsky with an article headlined, at least online, Developer Among Cast of Characters in Kruger Case.
There's not much there that wasn't in this blog yesterday, but the Times did get a quote in the developer's defense:
Forest City Ratner did not deny that Mr. Bender was the person to whom Mr. Kruger was speaking. “I don’t think it will come as a surprise to anyone that the person in charge of government relations at Forest City Ratner speaks to government officials,” said Joe DePlasco, a spokesman. The complaint, he said, “does not suggest that Forest City Ratner behaved in any way that’s inappropriate.”
Mr. Bender lives in Brooklyn, Mr. DePlasco said, “and I assume he likes Prospect Park.”
DePlasco's partly right--there's no evidence that Forest City Ratner instructed Lipsky to pass on lobbying fees to Kruger.
Weaseling out of bridge obligation?
But Forest City, arguably, did behave inappropriately, though not criminally. The developer, as of last June, was supposed to pay $16 million of the $40 million cost of the Carlton Avenue Bridge reconstruction.
The taped conversation shows that Forest City was trying to get $9 million in state funds to reduce its obligation. If the developer is still scrounging, what does it say about its commitment to rebuilding the bridge?
NoLandGrab: We're pretty sure it says "f*ck the bridge!"
Curbed, BROOKLYN BACKSCRATCHING
The Times takes a more detailed look at the involvement of developer Forest City Ratner in the corruption charges against Brooklyn State Senator Carl Kruger. There are no smoking guns for Atlantic Yards opponents, nor has FCR been charged with any wrongdoing, but wow, it just makes you feel dirty reading it. Ratner's VP of governmental affairs, Bruce Bender, tried to get Kruger to steer millions in state funds to three Brooklyn projects, and then Kruger made him choose one. Bender picked the skating rink renovation at Prospect Park, where his wife is a major fundraiser.
NLG: Like Carl said, "f*ck the bridge!"
The New York Times, Federal Corruption Case Ensnares a Self-Styled Fighter for the Underdog
...according to federal prosecutors, Mr. Lipsky had come to rely heavily on one well-placed politician to do his bidding, State Senator Carl Kruger, Democrat of Brooklyn, and was secretly paying him for his services.
Prosecutors said over $100,000 in cash was found in a safe in his home, and some $4,000 in crisp bills was in his suit pocket.
NLG: Wonder if they've dusted those bills for fingerprints yet.
LoHud.com, High-profile state senator charged in state's latest political scandal
Forest City Ratner and its affiliates have paid Lipsky more than $320,000 since 2005 for help with its projects in Yonkers, Brooklyn, Har-lem and Queens. Included in that was $256,000 that covered lobbying Yonkers Mayor Phil Amicone and City Council members regarding the $600 million Ridge Hill project. Forest City Ratner terminated its contract with Lipsky on Thursday, as did some other clients. Yonkers officials did not respond to messages for comment.
...The indictment relates to none of those projects, although prosecutors contend that Lipsky's efforts on behalf of Forest City's massive Atlantic Yards project in Brooklyn did receive help from Kruger.
NY Daily News, State Sen. Carl Kruger and Assemblyman William Boyland surrender to feds to face bribe rap
key player was co-defendant Michael Turano, son of Kruger's longtime friend, Dorothy Turano. Michael Turano controlled a shell company, Olympian Strategic Development, that served as Kruger's indirect ATM.
The FBI described Turano as Kruger's "intimate associate." Prosecutors say Kruger was so deeply involved with Turano's family, that by giving money to Turano, the bribers effectively paid off Kruger.
Olympian got $472,500 from developer Aaron Malinsky over several years to back his Brooklyn projects.
Recently, Malinsky tried to get a piece of mega-developer Bruce Ratner's project to build a retail complex called the Four Sparrows on city property in Mill Basin.
Ratner was torn between bringing in small department stores - the plan Malinsky wanted - or going with a "big box" superstore."
NLG: Yeah, we bet he was losing a lot of sleep over that one.
Develop Don't Destroy Brooklyn, "I Don't Mind F-king The Bridge."
Forest City Ratner has shown a knack for appearing in corruption cases, but never seems to get a proper screen credit. In the Ridge Hill corruption scandal they were billed as "Developer #2" and now, in the state Senator Carl Kruger indictment they appear as "Developer #1".
...The FBI reported that when told by Kruger, during a wire-tapped conversation, that there would be funds for a Prospect Park project but no public money to steer toward replacing the Carlton Avenue bridge, Bender was not happy:
The Vice President said that ..."this" was "bad." Kruger said, "I guess the park, fuck the bridge." The Vice President said that "my dilemma is as you know, I don't mind fucking the bridge, I can't fuck it right now, I've got to leverage that bridge, what's my value?"
It's hard to imagine that even a screenwriter could come up with an exchange that better encapsulates Forest City Ratner: a company whose only regard for the public is how much of our money can be siphoned off.
Atlantic Yards Report, If anyone else is snared in the federal investigation, who could it be? Maybe another legislator who's expressed excess Atlantic Yards enthusiasm
A reader asked if anyone, besides state Senator Carl Kruger, might be caught up in the federal investigation that snared Kruger and lobbyist Richard Lipsky.
We don't know--and there's no evidence that any other legislator is under investigation.
But who else, the reader asked, resembles Kruger in performance--a Brooklyn legislator who represents a district far from the Atlantic Yards site, but has vocally and dramatically backed the project?
That would be state Senator Marty Golden, who led a rally for the developer (below) at the 7/29/09 public hearing on Atlantic Yards and entered late, rudely interrupting the proceedings, at a 5/29/09 oversight hearing held by state Senator Bill Perkins.
The Village Voice has reported on Golden's questionable ethics, directing much business to a catering hall he used to own, and family members still run.
Is there any evidence Golden took money from lobbyist Richard Lipsky, or anyone else, to help Forest City Ratner? No.
But, just as Kruger's enthusiasm for Atlantic Yards should now be seen in new light, Golden's outsize enthusiasm deserves some reconsideration.
Park Slope Patch, Ratner Exec Tied to Pol Arrested for Corruption
A top Atlantic Yards executive pressed a Brooklyn state senator for millions of dollars to fund the controversial development, as well as a new ice-skating for Prospect Park, court documents reveal.
The charges filed against state Sen. Carl Kruger by federal prosecutors on Thursday do not explicitly name Atlantic Yards developer Forest City Ratner, but they do describe conversations with officials from a “real estate developer which is spearheading an over $4 billion, multi-year, mixed-use commercial and residential development project in Brooklyn.”
...Like the entire Atlantic Yards development, the reopening of the Carlton Avenue bridge — which links Prospect Heights and Fort Greene — has been beset with delays.
Originally the bridge was slated to close from roughly early 2008 to early 2011. Now, as the watchdog blog Atlantic Yards Report noted, the bridge is set to reopen in the summer of 2012.
NLG: Wonder what Vegas is giving on the Summer 2012 bridge reopening? 60-1? 70-1? We'll bet the over/under is October 2015.
Posted by eric at March 11, 2011 11:24 AM