When Campaign Aides Are Lobbyists, Questions Mount

Remaking the cratered world of Willets Point, Queens has been a developer’s dream since the imperious and seemingly everlasting reign of Robert Moses. A veritable galaxy of auto repair shops in the shadow of Citi Field, Willets Point is without sewers or paved roads, but its land, long eyed hungrily by developers, may undergo seismic change over the next decade. According to the glowing blueprints, a shopping mall, affordable housing and glittering office buildings will replace the greasy repair shops that tourists eye warily from the expressways.

Actually making this development—controversial, among other reasons, because it will displace many property owners and immigrant laborers—a reality is partially the job of the Parkside Group, perhaps the most dominant political force in the borough that is not elected by anyone. Since last May, they have represented the Queens Development Group LLC, the name for the duo of real estate companies that have won the bid for phase one of the Willets Point development, Sterling Equities and Related Companies. That’s one of many lobbying clients Parkside claims. Last year alone, according to the city’s lobbying database, the firm billed $1.8 million for its work with city officials on behalf of clients.

Parkside has another job, too—getting candidates for city and state offices elected, and re-elected. Over the 2005 and 2009 municipal election seasons, Parkside earned $3.2 million for advising candidates. On the state level, since 2005, the firm has earned $15 million for political consulting.

Some of Parkside’s Willets Point lobbying has been directed at the City Council, where sit some of the very people the firm helped elect. That’s because Parkside, founded more than a decade ago, is among a handful of influential firms in New York State that lobby elected officials while also serving as consultants for political campaigns, a practice that is perfectly legal but raises several ethical questions. What happens when lobbying and political jobs overlap? Will elected officials, already subject to a barrage of lobbyists, be even more unduly influenced if the consulting firms they employ for their campaigns are also turning around to lobby them soon after?

The firms that both consult and lobby turn the typical pay-to-play concerns of government watchdogs on their head. The issue here is not who’s giving money to a campaign, but who’s receiving candidates’ money—in exchange for valuable help. Consultants are, according to political observers, vital components of any operation: They are in many instances the quarterbacks of campaigns, plotting get-out-the-vote efforts, crafting media strategy and exploiting the weaknesses of the opposition. By accepting or rejecting a client, skilled consultants can significantly affect the odds of a campaign succeeding.

“When a firm helps someone get elected to office, that firm may have an easier time getting access to that office when they’re trying to influence how they’re going to vote on a particular issue,” says Bill Mahoney, the New York Public Interest Group’s legislative research coordinator.

Making points on Willets

The $3 billion proposed development at Willets Point has gone through several incarnations. Challenged relentlessly by Willets Point property owners who have protested the use of eminent domain to take away private property, the development, according to its backers, will bring thousands of jobs and economic benefits to Queens.

The battle over Willets Point illustrates how a consultant like Parkside manages to occupy almost every pivotal sphere of the issue. Besides its work for the Queens Development Group, Parkside also lobbies for labor unions that are in support of the Willets Point development, like Local 1500 UFCW and 32BJ SEIU. Meanwhile, Parkside often works side-by-side with the Queens County Democratic Party to ensure, in most instances, their handpicked candidates gain or retain their offices. Four of the elected officials with districts that include or border the Willets Point development—Assemblyman Michael Simanowitz, State Sen. Jose Peralta, Congressman Joe Crowley and State Sen. Toby Stavisky—have employed Parkside for their political campaigns, funneling the firm many thousands of dollars.

The county organization picked Simanowitz to run in a 2011 special election and he paid Parkside roughly $40,000 during that race. And Stavisky, facing tough re-election fights in 2010 and 2012, has funneled almost $300,000 to Parkside over the last decade. Stavisky and Simanowitz did not return requests for comment. Both have been very supportive of the Willets Point development.

The chair of the Queens County Democratic Party, Rep. Crowley, is also an unambiguous supporter of the Willets Point project. The scrapyards lie in his Congressional district. Parkside lists Crowley as one of their few Congressional clients on their website. As county leader, Crowley holds sway over many Democratic elected officials, but because it is not a federal issue he’ll have no legislative say on the development.

According to lobbying records, on behalf of QDG, Parkside has lobbied former or current clients like Peralta, Stavisky and Simanowitz over the past decade. Beyond the state legislature, QDG’s lobbying targets have included the City Council and the Queens borough president’s office, where Parkside’s ties have run particularly deep.

Lobbying on behalf of the Flushing Willets Point Corona Local Development Corporation in 2009, Barry Grodenchik was a key Parkside lobbyist in the early years of the approval process for the development. In 2010 he became a deputy borough president to Queens Borough President Helen Marshall. Now running for borough president himself, Grodenchik, who is not employing Parkside for his borough president race, declined to comment.

Though derided as a toothless tiger in the political world, the borough president’s office nevertheless plays a pivotal role in the city’s lengthy Uniform Land Use Review Procedure. The beep’s approval is an important indicator to the City Council whether a project, no matter how controversial, has received the proper vetting locally. Marshall so far has been one of the biggest boosters of the Willets Point development, penning an op-ed and attaching her support in a Bloomberg press release last year. She employed Parkside for her re-election campaign in 2009.

Last year, Attorney General Eric Schneiderman charged the Flushing Willets Point Corona LDC with illegally lobbying—by law, local development corporations are restricted from “trying to influence legislation by propaganda or otherwise.” Forced to pay a fine, the city’s Economic Development Corporation, which oversees the LDC, restructured itself to comply with the law. During the Attorney General investigation into the LDC’s lobbying activities, Parkside lobbyists Stavisky, Grodenchik, Williams Driscoll and Harry Giannoulis were served with subpoenas in 2009.

The connections make juicy targets for critics. “Parkside consultants have become kings because they use their business client’s resources, including the Queens Democratic machine, to attract candidates and fund their campaigns,” says political consultant and journalist Gary Tilzer.

Consulting fees in municipal campaigns, 1989-2009 (2009 dollars)
Spending on consultants increased dramatically over the 1990s. Most consultants do not, however, double as lobbyists. For more on the data behind this story, click here. Source: CFB

Parkside, however, denies anything unseemly about its consultant relationship with potential targets for its lobbying work. “We are proud of the work we do for a variety of clients and we pride ourselves on upholding the highest standards of ethical conduct in all of our activities,” stated Evan Stavisky, a partner at Parkside and the son of Toby Stavisky. “Our firm, and our clients, file more than 550 reports each year with city and state regulators outlining our compensation and our activities. These reports are available online to the public because government and politics function best when everything is open and transparent.”

Indeed, not every Parkside client is a supporter of the Willets Point plan. Peralta has paid Parkside more than $200,000 over the course of a decade to consult on various campaigns. He was recently an enthusiastic backer of development at Willets Point, pushing for a convention center to be placed there, but has since soured on the development because the affordable housing component is being delayed and scaled back.

“It’s hard to make money if you have to wait every other year”

In a 2011 report, the good government group Citizens Union highlighted the possibility of the overlap of political consulting and lobbying leading to, at the minimum, a perceived ethical issue. The group applauded all the disclosure of lobbying and campaign expenditures but added: “The perception persists, however, that candidates who get elected through the campaign services of lobbying firms may feel obligated to support policies advocated by the lobbying firms after they are elected. According to data provided by the [New York City Campaign Finance Board], of the 80 companies earning over $100,000 for campaign-related services in the 2009 election cycle, nine, or 11.5 percent, were registered lobbyists that provided campaign consulting-related services. Three of these firms made upwards of $1 million from selling such services.”

Besides Parkside, Sheinkopf Ltd., MirRam Group and the Advance Group are all major firms that lobby and consult on political campaigns simultaneously. Statewide, Berlin Rosen, a firm that consults and lobbies, was the biggest recipient of campaign money in the 2010 election cycle among firms that perform both functions, according to NYPIRG. (In a statement, BerlinRosen’s Michael Rabinowitz-Gold stresses that the firm “never communicates directly with elected officials on legislative or regulatory issues” but registers as a lobbyist because it creates websites and 800 numbers to facilitate constituent contact with officeholders.)

The combination of lobbying and campaign consulting activity is legal, it has sometimes raised eyebrows when elected officials take stances on hot button issues.

As the Bloomberg Administration has fought for a ban on large sugary drinks, many elected officials have lined up to savage the proposal. Two prominent clients of MirRam, Brooklyn Councilwoman Letitia James, running for public advocate, and former Comptroller Bill Thompson, running for mayor, are outspoken critics of the mayor’s proposal. James even co-wrote an opinion piece in the Huffington Post last year titled “Why the Soda Ban Won’t Work,” citing how it would hurt small businesses and infringe on civil liberties.

Thompson wrote a letter to the Health Department last year asking the commissioner to table the vote on the ban. In the letter, he said the soda ban, “pretends to address the problem [of obesity] while accomplishing nothing more than limiting individual choices and hurting small buisnesses.”

Thompson’s 2009 and 2013 mayoral campaigns have paid for $637,000 in MirRam’s services; James’ public advocate bid has spent $16,000 so far on MirRam. Under its lobbyist hat, MirRam works for Coca-Cola, which has paid MirRam $30,000 so far this year on top of $90,000 in 2012. Their target, according to lobbying records, was the City Council where James serves.

“MirRam adheres to the highest standards of ethics and law. We maintain a separation between our campaign clients and lobbying projects,” MirRam said in a statement, speaking also for their clients James and Thompson. James’ allies argue she was long an opponent of the soda ban before hiring MirRam.

Municipal Lobbying Fees (2012 dollars)
Total lobbying compensation fluctuates considerably. For more on the data behind this story, click here. Source: City Clerk

Defenders of the practice of firms lobbying and consulting argue that, beyond it being perfectly legal and protected by the First Amendment, it allows firms to remain financially viable when it is not campaign season.

“It’s hard to make money if you have to wait every other year,” said a Democratic insider. “I understand why they do it. They try to create a wall where one has nothing to do with the other.”

Indeed, in conversations with City Limits, firms insist that they keep lobbying and consulting operations separate, and do nothing unethical because their activities are disclosed.

Access is key

The Advance Group, headed by Scott Levenson, is one of the more visible consulting firms in the city. Consulting for a bevy of candidates during this election cycle, the group is also producing a series of television advertisements attacking Council Speaker Christine Quinn, the front-running candidate for mayor. While steering campaigns, many of them for the City Council, the group is also lobbying the City Council for a number of interests, chief among them hotel groups.

The city, undergoing a hotel building boom, in 2011 added 4,404 new hotel rooms to the city’s existing 74,025 rooms, an annual increase of 5.9 percent and the highest on record, according to a story last year in the New York Times. To make their case for hotel development, the Hotel and Motel Trades Council and the Hotel, Restaurant and Club Employees and Bartenders Union Local 6 have paid the Advance Group $24,000 since the beginning of 2012 to lobby the City Council. These labor groups have seen their membership swell as hotels rise in New York and unionize. For Democratic mayoral candidates, the Hotel Trades Council in particular has become a much coveted endorsement because of their organizing strength.

Currently serving in the City Council are several elected officials who Levenson’s group helped elect in 2009, including Council members Ydanis Rodriguez, Inez Dickens, Vincent Gentile and Erik Dilan. Lobbying records do not specify which individual candidates the Advance Group lobbied and Levenson declined a request for comment. He recently told the Daily News he doesn’t receive special favors from politicians he helps elect, but said the access they have is inevitably a part of their sales pitch.

“We’re a lobbying organization,” Levenson told the newspaper. “One of the things we do is talk about our ability to have access.”

Henry Sheinkopf, a Democratic political consultant and long-time lobbyist, also did not insist, unlike Parkside, that lobbying and consulting activities were always completely separate.

“Sometimes you do it, sometimes you don’t. It depends on the client,” he said. “It depends on the client and it depends on the appropriateness of the situation and it depends on what you consider lobbying.”

Reforms sought, scrutinized

Citizens Union recommended in their 2011 report that candidates who participate in New York City’s campaign finance program should be prohibited from using matching funds to purchase campaign consulting services from firms that also provide lobbying services. The recommendation has not been adopted.

Top consultants, total campaign fees, 2009-2013
Source: CFB For more on the data behind this story, click here.

At the state level, Sen. David Valesky, a member of the breakaway Independent Democratic Conference (IDC) that governs the State Senate with Republicans, proposed a bill on May 6 that would bar campaign consultants from turning around to lobby those that they elect to office.

Whether any law could actually be passed on the city or state level to limit this practice is unlikely, political observers say, precisely because of the close relationship between legislators and the consultants whom the law would affect. Members of the IDC like State Sen. Jeffrey Klein and State Sen. Diane Savino have employed firms that do double duty like MirRam and the Advance Group for past campaigns.

Meanwhile, some are suspicious about whether reforms are about cleaning up politics, or just silencing inconvenient voices.

“I have a very jaundiced view about all the people who call for clean government because most of them never worked a day in their lives or put a callous on their hands,” Sheinkopf said.

Reporting for this project was generously supported by the Fund for Investigative Journalism.

This passage was updated after publication to provide additional context.