THE "PORK" IN NEW YORK, Thoughts of an older American on Constitutional Government in the USA Options

[Livyjr]

"Some cautionary notes about CO2 sequestration"

02/24/2008

By Deb Donahue

LARAMIE - Twenty years ago a huge explosion of gas from Lake Nyos in the central Africa Republic of Cameroon killed nearly 1,800 people and untold livestock up to 15 miles away.

The naturally occurring gas was carbon dioxide (CO2).

A year later, the U.S. House Committee on Energy and Commerce decided that, “since CO2 is deadly, CO2 pipelines should have appropriate federal safety regulations.”

Concerns about CO2 today center not on its ability to asphyxiate, as in the Lake Nyos incident, but on its role in global warming.

Many are hopeful that new carbon capture and geological storage technology can reduce CO2 emitted from coal-fired power plants and other industrial sources by 80 percent or more.

Carbon capture and storage involves removing CO2 from fuels, compressing it, and injecting it under pressure deep underground.

Wyoming, the country’s biggest coal-producer, is at the forefront of this effort.

Two interesting bills now before the Legislature address carbon capture and storage.

House Bill 89 establishes that the surface owner also owns below-ground “pore space” in which CO2 might be stored; House Bill 90 charges the Wyoming Dept. of Environmental Quality with regulating “geologic sequestration” of CO2.

However well intentioned, the second measure jumps the gun.

The legal status of sequestered CO2 is a thorny issue that the federal Environmental Protection Agency must address and which it is only now beginning to take on.

Two types of CO2 injection - for experimental purposes and “enhanced oil recovery” - are regulated under the federal Underground Injection Control program to protect drinking water, which the state administers with EPA approval.

No law explicitly permits long-term CO2 storage.

In addition, U.S. Dept. of Transportation rules for pipelines treat CO2 as a hazardous liquid.

HB 90 directs the Wyoming Dept. of Environmental Quality to establish and issue permits to new “sub-classes of wells” within the Underground Injection Control program and to regulate well standards, bonding and monitoring.

Carbon capture and storage technology is already well advanced, but law and policy lag behind.

Last fall, Governor Freudenthal blamed “the absence of a well-thought-out, cogent federal policy” for the difficulties states face in “setting workable rules, regulations and operating practices.”

Although he told a congressional committee that Wyoming “favor(s) a model of federal standards and state implementation” (pointing to the Clean Air Act), he has urged the state legislature to “act now.”

If HB 90 is enacted, Wyoming will be the first to regulate long-term geologic sequestration of CO2.

Whether that law will mesh with EPA’s proposed underground injection rules, due in summer 2008, is the big question.

In the case of conflict, the Constitution dictates that federal law prevails.

Why legislate on a matter that the federal government controls?

HB 90 is brief and couched in the most general terms, leaving the specifics to Dept. of Environmental Quality, so the law will do little to influence EPA rules.

Raising the public profile of this issue is desirable.

But might this bill actually mislead the public?

HB 90 gives no hint that the state may not have complete discretion and ignores the risks of carbon capture and storage.

At concentrations above ten percent CO2 can cause adverse health effects.

The Lake Nyos incident illustrates what happens when CO2 is suddenly released: it blankets the ground and (at concentrations above 25 percent), asphyxiates humans and animals.

CO2 removed from combusted coal contains impurities, some toxic.

CO2 dissolves readily in water, forming carbonic acid, hence the Department of Transportation pipeline requirements.

“Supercritical” CO2, forcefully injected underground in vast quantities, can contaminate aquifers, escape through geologic faults or abandoned wells, and trigger seismic events.

Of greatest concern, say deputy state engineer Harry Labonde and Univ. of Wyoming School of Energy Resources director Mark Northam, is the potential for groundwater contamination.

CO2 dissolves toxic minerals in rock, which can then pollute aquifers.

Northam, a research scientist with a Ph.D. in organic geochemistry, cautioned legislators in a judiciary committee meeting not to proceed too hastily, warning that CO2 storage involves “unbalancing geologic systems that have been in balance for millions of years.”

The “core question,” he says, is where CO2 should be stored.

Few sites are appropriate and safe.

CO2’s unresolved legal status also clouds the viability of carbon storage.

Is the purpose to store a commodity for future use?

The governor has said as much, and one sentence in HB 90 provides for state jurisdiction over “any subsequent extraction … for commercial or industrial purposes.”

Or is the purpose to dispose of a waste product - a pollutant?

Under the law, the distinction matters.

According to the Congressional Research Service, “it is unlikely that the quantities of CO2 captured under a widely implemented CCS policy could all be absorbed in EOR or ECBM [enhanced recovery of coal bed methane] applications."

"In the long run, significant quantities of captured CO2 will have to be disposed as industrial pollution ….”

A crucial question is whether sequestered CO2 might be subject to regulation under the federal Resource Conservation and Recovery Act as a solid, and perhaps a hazardous, waste.

Don’t scoff: the act’s regulations stringently regulate land disposal of hazardous wastes, including in injection wells.

In sum:

• if supercritical CO2 - a dense vapor or fluid contained in pipelines prior to injection - is deemed a “liquid” or “contained gaseous material”, and

• if the sequestered CO2 is deemed to be “discarded,”

the CO2 will be a “solid waste” subject to the Resource Conservation and Recovery Act.

If the stored CO2 (under pressure, soluble in water, able to cause seismic fractures and dissolve toxic constituents in rock) is deemed to pose a hazard, it also will be “hazardous waste.”

Even if EPA doesn’t act, governors can petition the agency to list any substance as a hazardous waste, and citizens can sue to prevent the storage or disposal of any “solid waste” that “may present an imminent and substantial endangerment to health or the environment.”

The large scale of carbon storage, if widely adopted, reinforces the need for federal regulation.

Many potential CO2 storage areas straddle state boundaries, as would some pipelines.

Finally, carbon capture and storage, by appearing to solve the carbon problem, might reduce the public pressure to develop alternative energy sources or to conserve.

This, in turn, would lead to increased consumption of other nonrenewable resources.

The urgent need to curb global warming ought not lead us to adopt strategies with serious long-term risks of their own.

The legal classification of CO2 must be resolved.

Wyoming should wait, and EPA should act - soon.

(Editor's Note: Wednesday, the House passed on first reading HB 89 and HB 90.)

http://wyofile.com/CO2_sequestration_stora...face_owners.htm

WE HAVE GONE FROM HAVING A PROSITUTE-USING PETTY TYRANT FOR A GOVERNOR HERE IN NYS TO HAVING WHAT APPEARS TO BE NOTHING MORE THAN A WEAK, BLIND FOOL WHO IS BEHOLDEN TO SPECIAL INTERESTS WHO THINKS OUR STATE TAX DOLLARS BELONG TO HIM TO HAND OUT TO SPECIAL INTERESTS AS HE CHOOSES, AND PROVISIONS OF OUR STATE CONSTITUTION TO THE CONTRARY BE DAMNED ....

"Governor supports cleaner coal plant in Chautauqua County"

By CAROLYN THOMPSON, Associated Press

Last updated: 4:52 p.m., Tuesday, June 10, 2008

BUFFALO, N.Y. -- Gov. David Paterson on Tuesday promised up to $6 million of state funding toward the development of a new kind of coal-fired power plant in Chautauqua County.

The Jamestown plant would serve as a demonstration facility for an emerging technology that captures carbon dioxide emissions and sequesters the heat-trapping gas underground and out of the atmosphere.

"There is no silver bullet to solving the twin threats of climate change and growing energy demand, and New York should have a comprehensive strategy to address both," said Paterson, who visited the Jamestown site Tuesday.

Paterson committed up to $6 million to a coalition researching the project.

The Oxy-Coal Alliance, made up of Praxair, Dresser-Rand, Ecology & Environment, Foster Wheeler, Battelle Labs, the University at Buffalo and AES Corp., is seeking additional funding through federal grants.

"This is an excellent opportunity to demonstrate new, world-class technology right in our own community," Charles McConnell, a Praxair vice president said.

"Demonstration projects are fundamental to building a road map to commercial implementation of carbon dioxide capture technology in the future."

The Jamestown Board of Public Utilities has been planning a new municipal plant since 2003.

The idea of making it a demonstration project for carbon sequestration emerged last July in response to environmental concerns.

The project has the potential to remove more than 90 percent of carbon dioxide emissions, BPU officials said.

"The BPU has been committed to developing a plan to replace our aging plant facilities in a way that would meet or exceed environmental restrictions, striving for carbon neutral or negative emissions," BPU Chairman John Zabrodsky said.

Several environmental groups, however, say Jamestown does not need another plant to replace one being shut down which supplies about 20 percent of customers' electricity.

They say the city's needs could be met more cleanly and less expensively by a combination of energy efficiency and renewable energy development.

In a statement, opponents including the Citizens Campaign for the Environment, New York Public Interest Research Group and the Atlantic chapter of the Sierra Club, also criticized Paterson for investing state money in "unproven technology during a time of fiscal crisis" and for doing so before the completion of environmental studies.

"This power plant is ill-advised from both environmental and economic points of view and does not deserve to go forward," said Walter Simpson, co-founder of the Western New York Climate Action Coalition.

Opponents said the cost of the carbon capture and storage technology would increase the cost of electricity produced by the plant by as much as 40 percent.

One thing the state hopes to determine with the project is whether sequestration works in New York's geology, particularly upstate where it is considered favorable.

The carbon dioxide can be sequestered 3,000 to 5,000 feet below the ground, beneath a layer of solid cap rock.

Researchers on the Jamestown project also will explore ways to reuse carbon dioxide.

Sen. Charles Schumer, D-N.Y., praised the state investment, saying the project "propels Jamestown and upstate to the forefront of energy innovation when the sky-high price of oil shows we must diversity our energy supply."

Several conditions must be met before the project can go forward, including the establishment of a sequestration site.

Also, the state must enact legislation authorizing the siting of a carbon capture and sequestration facility in New York.

A working group of scientists and other experts will help guide the legislation.

The project, which could be operational in 2013, would create about 28 new jobs, retain 33 others and create 525 temporary construction jobs.

[Livyjr]

"Union foes killing property tax cap in NY Legislature"

By MICHAEL GORMLEY, Associated Press

Last updated: 4:12 p.m., Tuesday, June 10, 2008

ALBANY -- A proposed property tax cap supported by Gov. David Paterson, his expert tax-relief commission, and 72 percent of New Yorkers isn't likely to even reach the floor of the Legislature this session.

Powerful labor unions joined New York's teachers' unions lobbying lawmakers Tuesday to kill the proposal, which would limit the growth of local property taxes to about 4 percent a year.

School officials, education advocates and union leaders argued the cap would hurt classroom instruction and slow some recent progress improving student performance.

They said a limit would be especially difficult in a time of rising costs for fuel, health care and pension costs.

But Paterson's commission found 71 percent of a district's budget goes to salaries and benefits, mostly for unionized workers, and that despite record state aid -- nearly $1.8 billion this year alone -- property taxes continue to rise.

They are now the country's highest at 79 percent above the national average.

Lawmakers facing an election year have little interest in crossing Albany's powerful labor groups, which spend millions of dollars a year in campaign contributions, political support and lobbying.

And neither Republican Senate Majority Leader Joseph Bruno nor Sheldon Silver, the Democratic speaker in the Assembly, has supported Paterson's plan.

"We agree that something has to be done," said David Albert of the state School Boards Association, which opposed the measure Tuesday.

"We have to be responsible to the electorate, but at the same time, we have to make sure we provide a sound education."

"People are willing to pay more in taxes for good quality schools," he said.

The association estimates 75 percent of the cost of local and state school funding goes to salaries and benefits.

The association's 2007-08 survey of most districts finds the typical mid-career teacher, with a master's degree and 10 years experience, is paid an average of $55,670.

The average superintendent in the state makes $158,883.

Teachers' salaries are rising about 4 percent a year, according to the association's annual survey.

And most districts now require employees to contribute to their health insurance coverage, Albert said.

The U.S. Bureau of Labor Statistics said New York's mean annual wage for a high school teacher is $64,020, tops among all states.

When asked Tuesday about the proposed limit, Bruno listed several other measures he supports ahead of a cap.

But none of those have much of a chance in the Assembly under Silver, who is also not supporting Paterson's proposal.

Paterson's bill, released last week, hasn't even been introduced into the session, which ends June 23.

"It might not be introduced," said NYSUT Executive Vice President Alan Lubin.

"It's not having a lot of success at this point."

But Nassau County Executive Tom Suozzi, who headed Paterson's property tax committee, was still meeting with lawmakers Tuesday.

He said that after years of rising taxes, the time for a cap is now because it has the backing of a thorough report, the governor and angry taxpayers.

He noted a Siena College poll in January that found 72 percent of New Yorkers supported a property tax cap.

"This is something that voters are very angry about," Suozzi said, noting that property taxes are driving away employers and young New Yorkers.

He said the decade-old STAR program, which has grown to provide $5 billion in state subsidies annually to school districts, has resulted only in continued tax growth and spending beyond inflation.

When it was created, the Legislature beat back Gov. George Pataki's attempt to include a tax cap.

But on Tuesday, Suozzi was alone following the appearances by NYSUT, the school boards association, the state Parent Teachers Associations, other school, labor and the political groups with which they have long been allied.

The groups want measures other than a cap, including more state funding and a "circuit breaker" that would direct more taxpayer relief to the neediest taxpayers under established programs, including STAR.

"I think that the people who are lining up against the property tax cap are people who have grown accustomed to the status quo," Suozzi said.

"The definition of insanity is doing the same thing over and over and expecting a different result."

[Livyjr]

"Union foes killing property tax cap in NY Legislature"

By MICHAEL GORMLEY, Associated Press

Last updated: 4:12 p.m., Tuesday, June 10, 2008

ALBANY -- A proposed property tax cap supported by Gov. David Paterson, his expert tax-relief commission, and 72 percent of New Yorkers isn't likely to even reach the floor of the Legislature this session.

Powerful labor unions joined New York's teachers' unions lobbying lawmakers Tuesday to kill the proposal, which would limit the growth of local property taxes to about 4 percent a year.

School officials, education advocates and union leaders argued the cap would hurt classroom instruction and slow some recent progress improving student performance.

Lawmakers facing an election year have little interest in crossing Albany's powerful labor groups, which spend millions of dollars a year in campaign contributions, political support and lobbying.

"We agree that something has to be done," said David Albert of the state School Boards Association, which opposed the measure Tuesday.

"We have to be responsible to the electorate, but at the same time, we have to make sure we provide a sound education."

"People are willing to pay more in taxes for good quality schools," he said.

AH, YES, THE "GOOD QUALITY EDUCATION" THAT WE ARE PAYING REAL BIG BUCKS FOR HERE IN NEW YORK STATE ....

THE "GOOD QUALITY EDUCATION" THAT THESE POWERFUL UNIONS ARE PROTECTING AND DEFENDING ....

"WE HAVE TO MAKE SURE WE PROVIDE A SOUND EDUCATION", THEY TELL US ...

TALK ABOUT IMPROVING "STUDENT PERFORMANCE", ALRIGHT ...

HERE'S A DOSE OF IT NOW ....

"Broadalbin-Perth teacher admits rape"

By DAVID FILKINS, Staff writer, Albany, New York Times Union

Last updated: 3:14 p.m., Wednesday, June 4, 2008

JOHNSTOWN - A former Broadalbin-Perth Middle School teacher plead guilty today to rape for having sex with a 15-year-old boy who was her former student.

Elizabeth Munn, 33, was sentenced to six months in jail and 10 years' post-release supervision after pleading guilty to one count of third-degree rape, according to a statement from the Fulton County District Attorney's Office.

Munn, a married mother of two has already served two months.

She must register as a Level 1 sex offender, the lowest risk of three tiers the state uses to monitor sex offenders.

Munn resigned from her job and surrendered her teaching license as part of the agreement.

The statement said Munn sought psychological and psychiatric help because of her behavior even before she knew she was being investigated.

[Livyjr]

"Leader of governor's elite guard unit retiring - Roderick Covington stepping down as State Police reorganizing group"

By RICK KARLIN, Capitol bureau, Albany, New York Times Union

First published: Saturday, June 14, 2008

ALBANY -- The head of the State Police's executive services detail, charged with guarding the governor, is retiring.

Roderick Covington's announced retirement comes amid a reorganization of the elite unit, which was stemmed from a review by Superintendent Harry Corbitt.

During his confirmation hearings in April, Corbitt told lawmakers he would look at the executive services detail, which like the rest of the agency, is also being investigated by Attorney General Andrew Cuomo.

Following that, Corbitt was reportedly planning to change the way detail heads are appointed by turning that power over to the agency's superintendent rather than having the governor make the pick.

Cuomo's inquiry was requested by Gov. David Paterson, who wanted to make sure that officers were not engaging in political interference by tracking or harassing lawmakers or others.

"Rod Covington has had a proud and distinguished career."

"He has elected to voluntary retire but will serve in his present position until June 26," Corbitt said in a prepared statement.

"There are no allegations of any wrongdoing on his part."

"We are very proud and appreciative of his service."

Covington was friends with another former head of executive services detail, retired State Police Col. Daniel Wiese.

Last month, Wiese who was friendly with former Governors George Pataki and Eliot Spitzer and was known as an influential member of the State Police, was fired from his job as inspector general at the state Power Authority.

Covington will be replaced by Charles Day, a captain with the executive services detail since June 2006.

Rick Karlin can be reached at 454-5758 or by e-mail at rkarlin@timesunion.com.

[Livyjr]

IS NYS GOVERNOR DAVID PATERSON JUST A LUMP OF MALLEABLE PUTTY IN THE HANDS OF THE POWERFUL SPECIAL INTERESTS PROMOTING GAMBLING IN THE STATE OF NEW YORK FOR THEIR BENEFIT?

IS HE LOOKING TO CONSOLIDATE HIS GRIP ON CORRUPTION IN NYS AS HIS PREDECESSOR ELIOT "I LIKE YOUNG PROSTITUTES" SPITZER WAS TRYING TO DO?

STAY TUNED ...

"Shakeup of racing board in works - Governor Paterson planning to appoint pro-casino senator as chairman of regulatory panel"

By JAMES M. ODATO, Capitol bureau, Albany, New York Times Union

First published: Saturday, June 14, 2008

ALBANY -- Gov. David Paterson on Friday announced intentions to appoint his own chairman of the Racing & Wagering Board, a pro-casino Democratic senator who likely will lead a shakeup among the executive staff of the Schenectady-based regulatory agency.

Sen. John Sabini, D-Queens, a bettor well-acquainted with tracks and casinos across the country, was nominated for a six-year appointment to the post now held by Dan Hogan, an appointee of Gov. George Pataki.

Sabini, if confirmed by the Republican-led Senate, would have to stop betting at tracks and gambling halls in New York.

He has been the ranking Democrat on the Senate Racing & Racing Committee and is well versed on racing and gambling issues.

He has been looked to as a key resource within the minority conference, said Sen. Liz Krueger, D-Manhattan.

Yet he has been facing an uphill battle to win re-election, largely because his Queens Democratic Party has endorsed rival Hiram Monseratte, a Hispanic former cop who lost to Sabini in a close race two years ago in a district with an increasing Latino enrollment.

Sabini would take the post of Commissioner Michael Hoblock, the former Republican senator from Colonie, who has been continuing to serve as commissioner since his term expired Feb. 1, according to Paterson's aides.

Hogan would remain on the commission.

Hoblock is also the former chairman of the commission who refused to step down when directed to by Pataki.

The current chairman, Hogan, has about four more years on his term remaining.

Commissioner John Simoni, a Saratoga County Republican selected by Senate Majority Leader Joseph Bruno, has about two years remaining.

The chairman, paid $120,800, picks the executive director, whose pay is $146,699.

John Cansdale currently holds the post.

The next chairman will have the ability to replace several executive posts, including Cansdale's, working in concert with Paterson.

Sabini has accepted campaign donations from the gambling industry, including $8,200 from the Oneida Indian Nation, operators of Turning Stone Casino.

[Livyjr]

AS THE DAYS GO BY, NYS GOVERNOR DAVID PATERSON PROJECTS MORE AND MORE WEAKNESS AS NYS GOVERNOR ....

HE IS SEEN AS WEAK BY THE PEOPLE WHEN HE SPEAKS ...

HE IS NOT RESPECTED ...

SO HE DOES NOT HAVE WHAT IT TAKES ...

THE GUMPTION ...

TO STAND UP TO THE THUG-LIKE EX-BOXER WHO IS IN CHARGE OF THE NEW YORK STATE SENATE, THAT BEING REPUBLICAN JOE BRUNO ....

WHO IS IN IT FOR HIS OWN POCKET FIRST ...

And so ...

"End of session, but few answers - With just days remaining, solutions to problems elusive as governor faces partisan bickering in Legislature"

By IRENE JAY LIU, Capitol bureau, Albany, New York Times Union

First published: Sunday, June 15, 2008

ALBANY -- With only five days left in this year's historic legislative session, Gov. David Paterson is trying to wrestle big solutions out of a distracted, fractured and weary Legislature.

But if a news conference Thursday was any indication of the state of negotiations, the governor may have to lower his expectations.

On that day, Paterson and the four legislative leaders -- Assembly Speaker Sheldon Silver, Senate Majority Leader Joseph L. Bruno, Assembly Minority Leader James Tedisco and Senate Minority Leader Malcolm Smith -- met to discuss with the media priorities for the end of the legislative session.

The news conference began conventionally but soon devolved into half-joking, clearly pointed sniping between Bruno and Silver, and the governor doing little to stop the partisan back-and-forth.

At issue in particular was the governor's bill to cap local property taxes at 4 percent per year, a proposal neither Silver nor Bruno supports.

Bruno rejected Paterson's proposal, touted the Senate Republican's proposed legislation, and blamed Silver for lack of progress on the issue.

"Nothing is going to happen."

"So we are going to cover ourselves and posture."

"I know the governor is here and I'm here talking about this, I'm hoping the speaker will be willing," he said.

Bruno's proposed legislation would eliminate residential school property taxes in school districts that vote to phase out property taxes over five years, with revenue replaced by additional state funding.

"Senator Bruno clearly wants the Assembly to protect him from his spending habits," Silver shot back.

Silver has said that he would support a tax cap, but only if it included provisions to ensure continued funding for schools.

Concluding his remarks, Bruno said to Paterson, "So, governor, thanks for the invite, thanks for your leadership, now it's up to you to get a result."

Just three months into his tenure as governor, that is precisely the challenge Paterson faces in the session's last five days amid a looming state fiscal crisis, a Legislature preoccupied with November's elections and the high-stakes fate of the Senate majority in question.

"The governor is pushing very hard to get things done, but the Senate Republicans appear to be in a state of paralysis," said Sen. Eric Schneiderman, D-Bronx.

"They are vulnerable on so many fronts that no matter what they do legislatively, they may hurt one of the marginal incumbents," he said.

"Anybody would have difficulty closing things down this year," Schneiderman said.

Bruno spokesman Scott Reif disagreed, saying that their cooperation with the Democratic governor demonstrates their commitment to getting things done.

"I think it's actually going pretty well," Reif said.

"If there's paralysis, it is because the Senate and Assembly Democrats are creating it," he said.

"We are showing good faith and working with the governor."

"It is the Democrats of the Senate who are creating this election-day war."

In fact, both leaders have said they will work with Paterson, but neither house has brought to a vote the governor's property tax cap legislation, or many other bills.

Of the 18 bills Paterson has introduced, only five have become law.

But in a recent interview on WMHT television, Paterson warned the Legislature about the consequences of not putting actions with words.

"I think what's upset the public about the Legislature is that everything is calculated."

"Everything is strategic."

"And somehow not addressing an issue at all becomes preferable than coming to Albany and being decision-makers," he said.

At the news conference, Paterson, Bruno and Silver asserted that they continue to negotiate a number of issues, but when asked what would be accomplished by the end of this session, the governor wouldn't go into the specifics.

"We have to draw a distinction between open government and open negotiation...you've never seen a governor and state leaders negotiating on television."

"What you do see, and what you are hearing today, is people expressing their views and debating the issues."

"The openness of negotiations -- I probably have an idea, I'd rather not share it, because real responsibility in the end is to put meaningful legislation into law by the end of this session and respond to the people of this state."

Irene Jay Liu can be reached at 454-5081 or by e-mail at iliu@timesunion.com.

[Livyjr]

IS NYS GOVERNOR DAVID PATERSON JUST A LUMP OF MALLEABLE PUTTY IN THE HANDS OF THE POWERFUL SPECIAL INTERESTS PROMOTING GAMBLING IN THE STATE OF NEW YORK FOR THEIR BENEFIT?

IS HE LOOKING TO CONSOLIDATE HIS GRIP ON CORRUPTION IN NYS AS HIS PREDECESSOR ELIOT "I LIKE YOUNG PROSTITUTES" SPITZER WAS TRYING TO DO?

STAY TUNED ...

"Shakeup of racing board in works - Governor Paterson planning to appoint pro-casino senator as chairman of regulatory panel"

By JAMES M. ODATO, Capitol bureau, Albany, New York Times Union

First published: Saturday, June 14, 2008

ALBANY -- Gov. David Paterson on Friday announced intentions to appoint his own chairman of the Racing & Wagering Board, a pro-casino Democratic senator who likely will lead a shakeup among the executive staff of the Schenectady-based regulatory agency.

Sen. John Sabini, D-Queens, a bettor well-acquainted with tracks and casinos across the country, was nominated for a six-year appointment to the post now held by Dan Hogan, an appointee of Gov. George Pataki.

Sabini has accepted campaign donations from the gambling industry, including $8,200 from the Oneida Indian Nation, operators of Turning Stone Casino.

DAVID PATERSON IS ON A POWER-GRAB HERE IN NEW YORK STATE ...

HE WANTS THE LUCRATIVE GAMBLING INDUSTRY IN NEW YORK STATE TO BE IN HIS CONTROL ....

THAT IS WHERE THE MONEY IS, AFTERALL ....

IN WHAT USED TO BE CALLED "THE RACKETS" ...

BUT IS NOW CALLED STATE-SPONSORED GAMES OF CHANCE ...

AND HE IS NOT AVERSE TO GRABBING OUR STATE RAX DOLLARS FOR THIS BAIL-OUT OF HIS ....

MAKE US PAY FOR YET MORE MISMANGEMENT IN THE "GAMBLING INDUSTRY" IN NYS ....

And so ...

"State seeks a winner in OTB - Governor considers consolidating operations along with a bailout of NYC Off-Track Betting"

By JAMES M. ODATO, Capitol bureau, Albany, New York Times Union

First published: Sunday, June 15, 2008

ALBANY -- As Gov. David Paterson attempts to straighten out the losing ways of New York City Off-Track Betting Corp. with a state takeover, he is looking at eventually consolidating all of the other six OTBs as well, according to racing officials.

A bill drafted to allow the state to seize the assets and assume the liabilities of NYC OTB includes some provisions that would aid Capital District Regional Off-Track Betting and the five other betting operations.

But the NYC OTB bailout would mean creating the Empire State Racing Corp. with three gubernatorial appointees and one each from the Senate majority leader and Assembly speaker, to run the OTB branches in the boroughs of New York City.

The new public entity would likely propose to consolidate all the OTBs.

"The governor has indicated he wants to take a holistic look at racing just as he has with property taxes and mass transit," said Sen. John Sabini, D-Queens, Paterson's nominee to take over the state Racing & Wagering Board.

The OTBs already are pushing back on the notion of being absorbed into state government.

Capital OTB President John Signor said the bill to help NYC OTB get out of the red will likely include some provisions to help all the other OTBs by increasing the amounts taken out of winning bets, known as takeout, which is currently about the lowest in the nation. That would add $700,000 to $1 million in Capital OTB's revenues and also help improve the bottom line of the New York Racing Association, he said.

Other bill provisions expected, such as restricting out-of-state Internet betting competition, would also help, he said.

However, taking over the other OTBs isn't justified, Signor said.

Instead, Capital OTB wants to partner with other OTBs to share costs of services and cut down costs. It has been actively talking with Catskill OTB and Suffolk County OTB about such combinations. The state could become an ally, he said.

"There should be a statewide Internet site for all the OTBs and NYRA and one centralized phone betting center that all the OTBs can share and a coordinated marketing campaign with OTBs and tracks," he said.

Capital OTB serves 16 counties and the city of Schenectady and handles $200 million annually in bets. It sends about $5 million to the municipalities after covering expenses.

James M. Odato can be reached at 454-5083 or by e-mail at jodato@timesunion.com.

This post has been edited by Livyjr: Jun 16 2008, 11:42 AM

[Livyjr]

"Girvin and Ferlazzo firm to pay $500,000 pension settlement"

By JAMES M. ODATO Capital bureau, Albany, New York Times Union

Last updated: 12:45 p.m., Wednesday, June 18, 2008

ALBANY -- Attorney General Andrew Cuomo will accept a $500,000 settlement from Girvin and Ferlazzo, an Albany law firm whose partners scored lucrative state pension credits by improperly getting listed as public school employees, an official familiar with the agreement said today.

Girvin & Ferlazzo will not only pay the penalty but will have to discontinue any attempts to have its lawyers classified as public employees in the future, said the official who spoke on condition of anonymity.

Any billings the firm does as consultants to public employers will first have to be reviewed by the Attorney General's office for at least three years under the settlement, according to the official.

The firm has worked directly for 17 districts in Hamilton, Fulton and Montgomery counties as legal consultants.

But it had partners placed on the payroll of the regional Board of Cooperative Educational Services to collect pension credits.

The manner in which it decided which partners to include on the BOCES payroll was questionable, according to the official, because the lawyers involved may or may not have actually been engaged in work for the BOCES schools.

As part of the settlement, the firm's officials will assist in any criminal investigations involving former partners.

Cuomo's office is looking into financial arrangements involving Connie Cahill, according to the official.

She was an associate who joined the firm in late 1991 when it was formed under the leadership of James E. Girvin, Salvatore D. Ferlazzo and E. Michael Ruberti, now retired.

Ruberti's pension has also been under scrutiny.

In April, Comptroller Thomas DiNapoli removed four of partners, Girvin, Kathy Ann Wolverton, Kristine Lanchantin and Jeffrey Honeywell, from the state retirement system.

Cuomo is expected to announce the settlement and a resolution involving Binghamton lawyer John Hogan this morning.

[Livyjr]

"Paterson enlists voters in tax cap fight"

By MICHAEL GORMLEY, Associated Press

Last updated: 5:32 p.m., Tuesday, June 17, 2008

ALBANY -- Gov. David Paterson, buoyed by a poll that shows three in four New Yorkers support his property tax cap proposal that's getting no debate in Albany, tried to turn up the pressure on the Legislature Tuesday in the session's waning days.

Paterson said he refuses to drop the issue that the state's powerful teachers union and other lobbyists declared dead before arrival in April.

Paterson's insistence, forcing Democratic and Republican lawmakers to choose between their labor benefactors and their voters this election year, is adding to a rising tension in Albany where the last day of the 2008 session is scheduled for Monday.

A Kingston Daily Freeman editorial Tuesday criticized the Legislature for being unwilling to take up the tax cap proposal in the face of Albany's powerful special interests.

"Taxpayers may be squealing in outrage and pain about property taxes, but it's only the pay-to-play crowd that gets heard," stated the editorial headlined "Mockery of Democracy."

Paterson said New Yorkers are "voting with their feet," leaving for lower taxes and greater job opportunities in other states.

"We're losing our human capital," he said.

On Tuesday, he had taxpayers backing him up.

"We don't want to keep losing all our friends and neighbors and sons and daughters," said Andrea Vecchio of the East Islip Taxpayers group.

"Enough is enough."

She was among anti-tax representatives and chamber of commerce members from Rochester, Binghamton, Rockland, Glens Falls and Poughkeepsie who supported Paterson, a Harlem Democrat.

They wore T-Shirts and caps with "74" emblazoned on them, referring to the 74 percent of New Yorkers supporting the 4-percent cap on the growth in property taxes, according to Monday's Siena College poll.

"74 percent," said Democratic Nassau County Executive Thomas Suozzi who ran Paterson's tax relief commission.

"That's better than any coalition."

"Or are they just going to ignore that and play the typical Albany game ... and do nothing and go home," Suozzi added.

The Assembly's Democratic majority and the Senate's Republican majority haven't even introduced Paterson's bill.

Instead, the majorities have opposing tax-relief measures.

That likely will keep Paterson's tax cap from a floor debate.

Paterson said the Senate Republican majority's proposal to allow school districts to phase out property taxes altogether is half a solution and would require an increase in the state income tax.

Paterson said the Assembly Democrats' plan to increase relief for the neediest taxpayers under existing programs is a good second step, but not a substitute for a long overdue cap on the nation's highest property taxes.

"I need a partner in the Assembly and we need the governor to be there," said Senate Majority Leader Joseph Bruno, a Rensselaer County Republican.

"The governor is there trying to do something about property taxes."

"We ought to get something that's for real."

"We ought to do it three ways and we ought to have an open discussion about that."

Assembly Speaker Sheldon Silver, a Manhattan Democrat, said he could support a tax cap as long as there is a "state commitment to make sure the resources are there."

Paterson also aimed at the coalition opposing a tax cap, including the New York State United Teachers union, one of the most powerful lobbyists and biggest campaign contributors in Albany.

He said it was outrageous that the coalition declared the tax cap dead weeks ago.

"The governor is obviously attempting his very best to make his arguemnt for his legislation and as advocates in a democratic system we're doing our very best to raise our argument with lawmakers and citizens," said NYSUT union President Richard C. Iannuzzi.

"Obviously, there are times when we will respectfully disagree with the governor and this is one of them."

Paterson said he will continue to present the tax cap proposal statewide, and said he may bring the Legislature back before the fall elections for a public debate.

------

AP Writer Michael Virtanen contributed to this report from Albany.

[Livyjr]

AH, YES, THE "GOOD QUALITY EDUCATION" THAT WE ARE PAYING REAL BIG BUCKS FOR HERE IN NEW YORK STATE ....

THE "GOOD QUALITY EDUCATION" THAT THESE POWERFUL UNIONS ARE PROTECTING AND DEFENDING ....

"WE HAVE TO MAKE SURE WE PROVIDE A SOUND EDUCATION", THEY TELL US ...

TALK ABOUT IMPROVING "STUDENT PERFORMANCE", ALRIGHT ...

HERE'S A DOSE OF IT NOW ....

"Student, teacher missing from Buffalo school found"

Associated Press

Last updated: 6:12 p.m., Tuesday, June 17, 2008

BUFFALO, N.Y. -- Authorities say a female teacher and a 14-year-old male student missing since leaving school Monday have been found safe in separate locations.

Police picked up the boy, Nicholas DeJesus, in a mall in suburban Hamburg just before 11 a.m. Tuesday.

The 29-year-old teacher, Cara Dickey, was found sleeping in her car in Springville about 20 minutes later.

South Buffalo Charter School officials say Dickey was suspended and escorted from school Monday for sending what they deemed to be inappropriately affectionate text messages to the student's cell phone.

DeJesus left the school later in the day without permission.

Dickey is in police custody.

It is not clear whether she has been charged with any crime.

[Livyjr]

"Employers resist worker's comp 'bailout' plan - Companies that made payments to trusts suing state board that wants them to ante up even more"

By ERIC ANDERSON, Deputy business editor, Albany, New York Times Union

First published: Tuesday, June 17, 2008

ALBANY -- As soon as this fall, dozens of employers in the Capital Region will face hefty bills from the state Workers' Compensation Board.

They'll be asked to make up for years of underpayment into so-called self-insured trusts that provided their coverage for on-the-job injuries.

Those trusts have failed, and their administrator has agreed to give up its license.

In the meantime, however, healthy self-insured trusts are being asked to cover the failed trusts' costs, and that has triggered a legal battle.

Attorney Richard Honen of the Albany law firm Phillips Lytle LLP calls it a "bailout ... unique even for New York."

Honen, representing a group of 13 trusts -- basically employers that formed pools to self-insure against workers' compensation claims -- says they've seen their combined annual assessments to the board climb from $150,000 a year to $12 million this year.

The assessments typically pay for the operation of the board, including regulatory oversight of the trusts.

Now, the increase is covering the benefits to injured workers of the failed trusts.

"The board needs resources now to pay the current claims of injured workers," said board spokesman Brian Keegan.

"When in the future, the board is able to collect from defaulted trusts, this assessment will be adjusted accordingly."

"In the interim, the board recognizes its first priority is to defend the benefits injured workers across New York count on and will continue to act accordingly," Keegan said.

The group of trusts Honen represents has brought suit against the board and refused to pay the increased premiums.

"They've been paying full price for their premiums," he said Monday.

"And now they're going to bail out people who've been paying extremely discounted premiums?"

When the trusts didn't pay, the board sought to seize more than $14 million in security bonds the funds had posted.

But last month, Kimberly A. O'Connor, acting justice in state Supreme Court in Albany County, blocked that seizure while she decides the case.

The administrator of the failed trusts, Poughkeepsie-based Compensation Risk Management LLC, will surrender its license by Sept. 8.

Meanwhile, a forensic audit is seeking to determine which of the members owes what to make up the shortfall.

The board has rough estimates of the liabilities of at least three of the trusts, and although those estimates are 18 to 30 months old, they show at least $145 million in outstanding liabilities.

There was no word on how many assets the three funds held, however.

"I don't understand why no action has been taken against the administrator," Honen said.

Under an agreement with the board, Compensation Risk Management admitted no violations and paid no fines or penalties, a spokesman said.

"If that's the sum total of the action taken against that administrator, someone has let down the people of New York state," Honen said.

Eric Anderson can be reached at 454-5323 or by e-mail at eanderson

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"Ethanol plant developer sued - Company files $72M suit against former project partner, saying idea was stolen"

By LARRY RULISON, Business writer, Albany, New York Times Union

First published: Tuesday, June 17, 2008

ALBANY -- A Cooperstown company has sued the developer of a planned $350 million ethanol plant at the Port of Albany, claiming the idea was essentially stolen.

Empire State Ethanol & Energy LLC, which has offices both in Cooperstown and Colonie, filed a $72 million lawsuit Friday against Albany Renewable Energy LLC in U.S. District Court in Albany.

Christopher Von Zwehl, president of Empire State Ethanol, declined to comment on the case.

His attorney, William Hurst of Hiscock & Barclay LLP in Albany, could not be reached for comment.

In the lawsuit, Empire State Ethanol claims it has been working on developing a corn-to-ethanol plant since 2006.

It teamed up with a Colorado company, BBI International, and potential sites were identified in Oneonta and Cobleskill, according to the suit.

Last year, Empire State Ethanol claims, it started looking at the Port of Albany as a potential site.

But BBI said it could no longer team with Empire State Ethanol on the project, and the two companies parted ways in November.

Empire State Ethanol alleges that while this was going on, BBI executives were working behind its back to create their own ethanol project for the Port of Albany.

The lawsuit claims the group of BBI executives created Albany Renewable Energy, which was selected in March by the Albany Port District Commission to develop 18 acres at the port.

"We have no comment at this time," Tom Owens, general counsel for the port commission, said Monday.

"It's a dispute between private parties."

In its lawsuit, Empire State Ethanol claims Albany Renewable Energy was formed by Jeff Kistner, a Nebraska-based BBI executive.

Other partners, it says, are Mark Yancey, a BBI executive based in Colorado, and Ed Stahl, a BBI executive based in North Carolina.

All three men, along with BBI, are listed as defendants in the case.

A receptionist at BBI said Kistner and Stahl no longer work at BBI.

Yancey was said to be at an industry conference and was not available for comment.

Stahl, who owns BioPro Resources LLC in Huntersville, N.C., has been the public face and spokesman for the $350 million Albany Renewable Energy project.

He could not be reached for comment Monday.

BioPro is also listed as a defendant in the case.

The lawsuit claims Von Zwehl received an e-mail from Kistner in February stating he was "one of the founding members of another entity that has also submitted a proposal" to the port commission.

"I suspect this e-mail comes as a bit of a surprise," the lawsuit quotes Kistner as telling Von Zwehl.

In the suit, Empire State Ethanol is seeking $57 million in compensatory damages and $15 million in punitive damages, along with attorney fees.

Larry Rulison can be reached at 454-5504 or by e-mail at lrulison@timesunion.com.

[Livyjr]

"Bruno open to a cap? - Some in GOP embrace governor's property tax proposal, urge action"

By IRENE JAY LIU, Capitol bureau, Albany, New York Times Union

First published: Friday, June 20, 2008

ALBANY -- Senate Majority Leader Joseph L. Bruno may be warming to the idea of a property tax cap, according to a person with knowledge of the negotiations.

Bruno's movement on the issue comes as some of his members, particularly upstate senators in highly competitive races this fall, are starting to put pressure on the Senate majority leader to address the issue.

Republican candidates who are challenging Democratic incumbents, too, have been embracing Democratic Gov. David Paterson's proposal for a 4 percent annual cap on school property tax growth.

That's contrary to Bruno's push for a GOP bill that would allow school districts to phase out property taxes altogether, with the state picking up the cost.

Critics have said the proposal, combined with Bruno's resistance to raising income taxes, is unrealistic, but Bruno, of Brunswick, says the money is out there in gambling revenues and uncollected taxes on Indian reservations.

The issue is still very much in negotiations, the source said, but there is a feeling on the Republican side that a property tax cap might offer a temporary fix while a permanent solution to cut property taxes is worked out.

If Bruno does come around to Paterson's proposal, it may force the Assembly to negotiate.

Assembly Speaker Sheldon Silver, D-Manhattan, has said he's willing to support a property tax cap, as long as it "gives relief to the people who most need it" and ensures continued resources for schools.

Senate Minority Leader Malcolm Smith, D-Queens, has said he would favor a 2 percent tax cap, half that of Paterson's proposal.

Assembly Minority Leader James Tedisco, R-Schenectady, has favored a cap as part of a "holistic" approach that includes relief for schools from unfunded state mandates.

Neither chamber has brought Paterson's proposal to a vote.

The session is scheduled to end Monday, and the Legislature has recessed for this week.

The tax cap debate has already spilled over into the fight for the Senate majority, which the Republicans now hold by a slim 32-30 margin.

In an odd twist, Republican challengers are making no mention of Bruno's proposal, while taking incumbent Democratic senators to task for not supporting Paterson's tax cap proposal.

Republican Larchmont Mayor Liz Feld, who is challenging Sen. Suzi Oppenheimer, D-Mamaroneck, on Tuesday called out Oppenheimer for not sponsoring Paterson's legislation, saying the first thing she'd do if elected would be to put her own name on the bill.

On Thursday, Feld pressed Bruno to work with Paterson to pass the 4 percent tax cap.

"If legislators in Albany go home on Monday without doing anything to ease the property tax burden on families, senior citizens and small businesses, they will be sending a clear signal that special interests matter more than the 74 percent of New Yorkers who support the tax cap," Feld said, referring to a Siena Research Institute poll.

On Wednesday, David Renzi, the Republican challenger to the Senate's newest member, Democratic Sen. Darrel Aubertine of Cape Vincent, called for immediate passage of Paterson's tax cap.

Irene Jay Liu can be reached at 454-5081 or by e-mail at iliu@timesunion.com.

[Livyjr]

"Job losses take merry out of May - Month's unemployment rate hits level not seen here since early '90s"

By CHRIS CHURCHILL, Business writer, Albany, New York Times Union

First published: Friday, June 20, 2008

The Capital Region's unemployment rate surged to 4.8 percent in May, the highest rate for that month since 1992.

In May 2007, it was just 3.6 percent, but large job losses in two fields -- financial services and leisure and hospitality -- contributed significantly to the rise this year, the state Department of Labor said Thursday.

The numbers, which are not adjusted to reflect seasonal variations, were even up compared to April.

That's unusual, because the pace of hiring usually picks up as the weather gets warmer.

"Typically, the unemployment rate would drop from April to May," said James Ross, who analyzes the Capital Region labor market for the department.

The statewide unemployment rate, not seasonally adjusted, was also up in May, to 4.9 percent from 4.2 percent a year earlier.

Unemployment rates measure joblessness among people who have no job or are actively seeking work.

Experts interviewed Thursday said they expected the increase in unemployment.

"This is a substantial increase .... but it's not a surprise," said Hugh Johnson, chairman of Johnson Illington Advisors, an investment firm in Albany.

"It just mirrors what has happened nationally."

Tony Riccardi, a private economist in Albany, agreed, saying the Capital Region economy typically lags a few months behind national economic trends.

The numbers, he said, are "just evidence that we're going into a recessionary cycle."

Ross, though, questioned the accuracy of the unemployment numbers because other indicators don't suggest unemployment should be that high.

Ross noted, for example, that the percentage of jobless people receiving unemployment insurance in the Capital Region dropped to 25.8 percent in May from 31.2 percent a year earlier -- a trend that's the opposite of what economists expect during a worsening economy.

And he pointed to a statistically unusual surge in the number of young people seeking or holding jobs, leading him to wonder about the accuracy of the U.S. Census Bureau sampling on which the national, state and local rates are based.

Still, Ross said he does not doubt that the Capital Region's jobless rate is increasing at a pace that suggests a downturn.

Despite the darkening local picture, the numbers Thursday continued to show the Albany-Schenectady-Troy area with a lower jobless rate than most other upstate metropolitan areas.

Saratoga County had the area's lowest unemployment rate, at 4.4 percent, while Schoharie and Greene counties had the highest, 5.7 percent.

The unemployment rate was 4.8 percent in Albany County, 5.0 percent in Rensselaer and Schenectady counties, and 4.6 percent in Columbia County.

The May unemployment rate in the Glen Falls area was 5.1 percent, up from 4.0 percent a year ago.

Churchill can be reached at 454-5442 or by e-mail at cchurchill@timesunion.com.

Upstate unemployment picture*

May 2008 - April 2008 - May 2007

Buffalo area: 5.8 - 5.4 - 4.4

Rochester area: 5.3 - 4.9 - 4.1

Syracuse area: 5.2 - 4.8 - 4.1

Binghamton area: 5.1 - 4.8 - 4.1

Utica-Rome area: 5.2 - 5.1 - 4.0

Albany area: 4.8 - 4.4 - 3.6

New York state: 4.9 - 4.5 4.2

* Figures not seasonally adjusted Source: State Labor Department

[Livyjr]

"Leaders reject foreclosure freeze - Legislation mandates warnings to borrowers, settlement talks"

By CHRIS CHURCHILL, Business writer, Albany, New York Times Union

First published: Friday, June 20, 2008

ALBANY -- New York will toughen its mortgage rules but won't enact a one-year freeze on all home foreclosures.

The legislation was announced Thursday by Gov. David Paterson and legislative leaders.

It was hammered out in long negotiations that sorted through competing proposals designed to address rising loan default rates.

"This took some real perseverance," said Senate Majority Leader Joseph L. Bruno, R-Brunswick.

The legislation requires that lenders send written warning to borrowers 90 days before starting the foreclosure process, and establishes a "mandatory settlement conference" between lenders wanting to foreclose and borrowers holding certain subprime loans.

It also requires that lenders establish that borrowers are able to repay a loan; increases the penalties for mortgage fraud; and mandates that all mortgage servicers register with the state, among other provisions.

Housing advocates in recent months have pushed hard for new foreclosure rules, saying rising default rates tied to the subprime mortgage industry represent a crisis that's destabilizing New York neighborhoods.

But the banking and mortgage industries pushed back hard, noting that New York already has some of the nation's toughest consumer protection laws on mortgages.

Bankers particularly reviled a one-year foreclosure freeze passed earlier this year by the Assembly.

Groups like the New York Bankers Association said it would cause many lenders to abandon the state, making credit harder to obtain for all New Yorkers.

On Thursday, Paterson said a moratorium wouldn't be as helpful as some believe, because it would allow owners a longer stay in homes they would eventually lose.

Despite the intense lobbying that preceded Thursday's announcement, proponents and opponents of the new legislation were quiet afterward, saying they were waiting to review its nitty-gritty details.

"We have not seen the actual bill language yet and will not be commenting until we have had the opportunity to review it," said Karen Jannetty, spokeswoman for the bankers association.

[Livyjr]

"Self-insured trusts under investigation - Failure to provide workers' comp coverage referred to state attorney general's office"

By ERIC ANDERSON, Deputy business editor, Albany, New York Times Union

First published: Thursday, June 19, 2008

The failure of several self-insured trusts that provide workers' compensation coverage to member employers has been referred to the state attorney general's office, according to a spokesman for the state Workers Compensation Board.

The trusts were administered by Poughkeepsie-based Compensation Risk Management LLC, which has agreed to surrender its license.

Their failure has left dozens of employers in the Capital Region without coverage and facing potentially hefty liabilities.

The self-insured trusts are one way for employers to get workers' compensation coverage.

The largest corporations typically self-insure, paying claims directly.

Private insurance companies and the State Insurance Fund also offer coverage.

But the trusts -- whose members were groups of companies in similar lines of business -- were seen as a cost-effective way for smaller employers with strong safety records to get coverage for a lower price.

A call to the attorney general's office Wednesday wasn't returned.

Compensation Risk Management admitted no violations and paid no fines or penalties in its agreement with the board to surrender its license, a company spokesman said last week.

Also on Wednesday, acting Justice Kimberly O'Connor of state Supreme Court in Albany County rejected a request by a group of self-insured trusts administered by Colonie-based First Cardinal Corp. to inspect and copy the failed trusts' records.

The trusts are suing to block the Workers Compensation Board from boosting their assessments to cover liabilities of the failed trusts.

"By law, we are responsible for the current claims of injured workers and the only funding mechanism the law allows us is through these assessments," said board spokesman Brian Keegan.

"As these funds are recovered, they will be returned to the rest of the self-insurance community that provided the interim cash flow."

Keegan said the members of the failed trusts ultimately are responsible for the shortfalls.

"The former members of the defaulted groups that are causing the cash flow issues are or will be billed for these costs," he said in an e-mail.

"In several cases, we are already aggressively pursuing collection against the members of defaulted group self-insured trusts."

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"Board focus of aid probe - Cuomo studies BOCES officials to find if pensions were awarded to lawyers to boost state payments"

By JAMES M. ODATO, Capitol bureau, Albany, New York Times Union

First published: Thursday, June 19, 2008

ALBANY -- As Attorney General Andrew Cuomo revealed the biggest settlement in his pension fraud investigations, his office was continuing to probe whether BOCES officials were part of a conspiracy to milk the public retirement system.

Cuomo announced a $500,000 deal Wednesday with top lawyers of the Albany law firm of Girvin & Ferlazzo.

He also emphasized he has unfinished business on the case, including civil or criminal cases open against former principals M. Cornelia Cahill and E. Michael Ruberti.

Cahill now works for Hiscock and Barclay.

Her lawyer, Daniel J. French, said he expects Cahill to make a civil settlement soon.

Ruberti could not be reached.

Also, Cuomo's office said it intends to scrutinize the history of the deals in which the Hamilton-Fulton-Montgomery BOCES appears to have conspired to put lawyers on the public payroll as far back as 1989 in order to secure state aid for lawyers who were listed as personnel.

Joseph Iraci, in charge of the BOCES when the deal was first struck, declined to explain why he entered into the arrangements Cuomo called improper.

The current superintendent, Geoffrey H. Davis, would not give an interview.

A person familiar with the case said the BOCES appears to have participated in a scheme that resulted in state aid being unjustifiably awarded to school districts.

Girvin & Ferlazzo said it decided to settle as "a sound business decision despite any good faith disagreement and to forgo a lengthy and expensive litigation."

"This payment is not a fine or a penalty of any kind," Jeffrey Honeywell, managing partner, said.

"It is the cost of allowing the review to end and permit us to continue with the business of serving our clients."

During the 19-year BOCES relationship, Girvin & Ferlazzo decided which lawyers would get the "perk" of being put on the payroll, Cuomo's office said, regardless of whether they worked on school matters.

Twelve Girvin & Ferlazzo lawyers were improperly listed as beneficiaries of public benefits, Cuomo said.

The firm also was paid fees negotiated with each school district.

BOCES would collect the fees from the districts and pay the firm.

The BOCES schools were able to get reimbursed from the state because the lawyers were listed as BOCES employees, doing labor relations work for the districts.

Cuomo noted state aid was only eligible for labor relations services and some of the firm's lawyers getting the pension credits lacked such expertise and couldn't provide such services.

Nevertheless, all of the lawyers were actually acting as outside retained counsel, not as employees, and none should have received public pension benefits, Cuomo said.

It was part of a "fraud" committed for years by hundreds of lawyers serving municipal employers, he said.

Salvatore Ferlazzo, Cahill and Maureen Harris never worked on any labor relations matters for the BOCES, even though that was what the contract called for, Cuomo's office said.

Harris, a commissioner with the State Public Service Commission now, settled allegations against her last month.

She gave up pension credits accrued during her work with the firm and forfeited contributions to the pension system as well.

She also paid $50,000.

The lawyers settling with Cuomo agreed to the same terms, but also promised $500,000, five times the largest settlement to date.

Additionally, the Girvin lawyers agreed to furnish information about former colleagues who did not settle.

Partners James Girvin, Salvatore Ferlazzo, Kristine Lanchantin, Jeffrey Honeywell, Kathy Ann Wolverton and Gregg Johnson said they would cooperate fully with the attorney general's continuing investigation against Cahill and all other current or former partners of the firm who have not settled.

That would include Ruberti, who is drawing a pension of more than $50,000 a year.

The investigators said Ruberti's work with the BOCES may be defensible, because he had an office at the schools and showed up for work there, according to one knowledgeable official.

However, he later negotiated a deal to work for the Troy school district to bump up his pension credits and his annual pay for pension calculations.

The prosecutors have been trying to get him to pay back the additional pension sums he collected and to forfeit future payouts attributed to his Troy career, a lawyer familiar with the probe said.

Ruberti has refused.

Cuomo also announced settling for $100,000 a case against Hogan, Sarzynski, Lynch, Surowka & DeWind in Binghamton.

However, former principal John B. Hogan, retired since 2000, has declined to settle.

The Girvin firm has to pay $250,000 within 15 days and the rest by June 10, 2009.

And for three years, the firm must submit its billing records to the attorney general's office for any invoices sent to school districts.

The firm, or its lawyers, had at least three Albany attorneys representing it in the settlement, including William Dreyer, James Featherstonhaugh and Donald Kinsella.

Although they do not admit guilt, they are forbidden to make any public denials about the allegations made by Cuomo, according to the settlement.

James M. Odato can be reached at 454-5083 or by e-mail at jodato@timesunion.com.

[Livyjr]

"Ethics panel seeking deals in Travelgate scandal cases"

By DANNY HAKIM, New York Times

First published: Thursday, June 19, 2008

ALBANY -- A state ethics panel is seeking to settle cases against top aides to former Gov. Eliot Spitzer, a year after their alleged involvement in an effort to gather the travel records of Joseph L. Bruno, the Senate majority leader.

The panel, the Commission on Public Integrity, has been threatening to open a formal public inquiry against some of the aides if they refuse to settle, according to people who have been briefed on the inquiry.

The commission has also questioned Spitzer under oath since he left office, though it is not clear whether the former governor is a target of the commission's investigation.

The staff could present cases against the former Spitzer administration officials as early as a commission meeting scheduled for today, though the presentation would be made to the 13 commissioners behind closed doors.

It is still uncertain whether Spitzer himself faces sanction in the state investigation, though he is almost certainly more focused on avoiding federal charges related to a prostitution ring; reports that Spitzer was a client led to his resignation three months ago.

Former Spitzer staff members involved in settlement talks include Richard Baum, who as secretary to the governor was Spitzer's top aide, and Darren Dopp, who was Spitzer's communications director.

The commission has also been investigating William F. Howard, who was the former governor's liaison to the State Police.

[Livyjr]

"Lawyer under pension scrutiny keeps state ties - Collecting retirement at his Georgia home, he works for Westchester County school and as arbitrator"

By RICK KARLIN, Capitol bureau, Albany, New York Times Union

First published: Thursday, June 19, 2008

ALBANY -- One of the founders of what is now the Girvin & Ferlazzo law firm has retired in Georgia, by most accounts.

But his public pension remains under scrutiny by New York's attorney general.

E. Michael Ruberti, who now resides in the seaside community of St. Simon's Island, Ga., has been collecting a $50,577.98 annual pension since 1995, according to state comptroller's office.

But Ruberti, who challenged Albany Mayor Erastus Corning 2nd in 1977 on the Republican line, still travels to New York state on a regular basis and has business dealings here.

Ruberti serves as the lawyer for a small but controversial Westchester County school district, and as an arbitrator for the Governor's Office of Employee Relations, handling grievances from members of the Public Employee Federation union.

He works for the state several days a month at the usual arbitrator's rate of $800 per day, according to Employee Relations.

Officials at the Greenburgh 11 School District confirmed Ruberti continues to serve as a legal adviser, which he's done since the early 1990s.

They stressed that he is listed as contract employee, not a staffer.

Attorney General Andrew Cuomo's agreement announced Wednesday with Girvin & Ferlazzo centers on the firm's practice of having its lawyers listed as employees to be eligible for state pension benefits.

Cuomo and Comptroller Thomas DiNapoli say lawyers around the state have wrongfully collected pension credits and they are moving to strip them of the benefits.

While Cuomo said he's looking into Ruberti's status, the Greenburgh 11 teachers union is calling for Ruberti to be removed in light of the ongoing pension investigations.

In a prepared statement, the union said the district has spent millions on lawyers, including Ruberti, since 1994.

"The district was seeking to punish its teaching staff for speech which was critical of the waste and mismanagement going on at children's village and the school district," the statement said.

"We also believe the Greenburgh 11 school board should consider retaining new counsel for their legal needs."

Ruberti could not be reached on Wednesday.

And district officials didn't return a call seeking to find out how much they've paid Ruberti over the years.

Greenburgh 11 is among a handful of "special act" school districts created by the Legislature and funded largely by the state rather than local property taxes.

Its students live in The Children's Village, a nonprofit child-care agency for troubled youths, located in Dobbs Ferry.

Labor relations with the school district came to a head in 1994 when the board fired two aides and filed disciplinary charges against eight teachers who picketed a dinner attended by school officials to protest their lack of a contract and other labor issues.

"I refer to it as the J.P. Stevens of New York," said Jeff Cassidy, a New York State United Teachers negotiator who had worked at Greenburgh 11, referring to the famed 1930s textile strike.

"It was the worst labor case imaginable."

Relations between the teachers and school board became so bad that NYSUT prepared a special report on the situation and, Cassidy said, pushed successfully for legislation to broaden the school board's representation.

Still, he said, Greenburgh 11 has five teachers who, having crossed the administration, work in what are essentially do-nothing jobs, Cassidy said.

Rick Karlin can be reached at 454-5758 or by e-mail at rkarlin@timesunion.com.

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"Audit: Project was expensive - DiNapoli report contradicts former officials on dumping excess fill"

By JORDAN CARLEO-EVANGELIST, Staff writer, Albany, New York Times Union

First published: Thursday, June 19, 2008

COLONIE -- A controversial public works project in which tons of excess fill was dumped on land owned by a private club did not save taxpayers a dime, contrary to what former town officials contended, according to a state audit released Wednesday.

State Comptroller Thomas DiNapoli's office says the work at the West Albany Rod & Gun Club -- where several former town officials were members -- actually cost Colonie as much as $42,000 more than other ways of getting rid of the fill -- known as spoils.

Improvements were also made to a road and parking lot at the club, raising the appearance of impropriety, according to the audit.

DiNapoli's findings contradict a previous, internal town audit that said the project saved taxpayers at least $125,000.

DiNapoli said the project "gives new meaning to 'clubhouse politics.' "

"Town government should be working for the people, not the private clubs they belong to," DiNapoli said in a statement.

The controversy stems from the dumping of some 2,600 tons of spoils that accumulated in the town highway yard after storms.

It was trucked to the club's property at the end of the Willoughby Drive.

Town workers eventually spent 700 hours at the site between Aug. 16 and Sept. 7, starting work four days before the contract was even signed, auditors found.

Officials had contended it saved taxpayers money by avoiding more costly disposal methods.

But the state identified at least three cheaper ways -- including paying a private contractor to haul it off at a cost of about $6,100 or dumping it in the town landfill for $27,000.

The audit faults lax oversight by the Town Board, which never approved the project, and supervisors within the highway department.

Two officials who also were members of the club -- former Town Board member Ulderic Boisvert and former Town Attorney Arnis Zilgme -- should have publicly disclosed their interest, the report said.

Both said the audit, released after a draft had been obtained by the Times Union, overstates their involvement.

A major disagreement between the two audits is whether the town landfill would have had to charge the highway department for dumping.

Former town officials said the charge would have been necessary, at a cost of $132,600.

But state auditors said the charge is not required.

Beyond dumping the spoils, the town did $20,000 worth of "major capital improvements" at the club, work described only vaguely in a one-page contract and which, according to the state, far exceeded any benefit to taxpayers.

DiNapoli's office said the project cost $48,000 -- not including $38,000 in roadway materials that the town may not have needed to buy if the project had not been done and between $15,000 and $30,000 in federal money missed by not using the landfill.

Heather Orth, a spokeswoman for Albany County District Attorney David Soares, said the investigation into whether any laws were broken continues.

Soares and DiNapoli, both Democrats, announced their joint inquiry three weeks before the November election that ended eight decades of Republican rule in Colonie.

Their inquiry came on the heels of the town audit, which found no wrongdoing but said the project should have come before the Town Board.

"We never accepted those findings," said Supervisor Paula Mahan, a Democrat who took office in January.

Boisvert questioned the figures in the state audit and said it overstates his role in brokering the project.

"I was never, ever at any time involved in the contract," Boisvert said.

He said the public works department approached him after failing to find someplace to dump the material and that he acted as go-between, pitching the idea as a town official.

"Everybody knew I was a member," Boisvert said, adding the club initially rejected the idea.

Once it agreed, "all I did at that point is call the highway department and say, 'They're interested, you guys work out the particulars.' "

Boisvert said the audit reeked of politics.

Zilgme said the contract never went through his office and that he was out of town the night club members approved the deal.

Former Supervisor Mary Brizzell repeated the town's findings that the project should have had more oversight.

Brizzell stressed that she was never told about the project until weeks after it began.

"If I had known that they were even contemplating doing this, I never would have allowed it to happen, just because of the perception," said Brizzell, a Republican.

"And I stand by that."

Carleo-Evangelist can be reached at 454-5445 or by e-mail at jcarleo-evangelist@ timesunion.com.