Tag: reform

Ranzenhofer and the LLC Loophole

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Last week, in my story about Attorney General Schneiderman’s push for an ethics reform bill in Albany, I alluded to local state Senator Mike Ranzenhofer’s involvement, but it bears its own post.

One of Schneiderman’s proposed reforms would close what’s called the “LLC loophole”. This legal quirk enables politicians to raise massive sums of campaign cash that is difficult, if not impossible, to trace. For donors, it’s an easy way to (a) donate cash without leaving easily identifiable fingerprints; and/or (b) completely bypass and ignore the mandatory maximum donation. It costs just $200 to file and create an LLC, and each LLC can donate as a separate individual. One New York City developer has used the LLC loophole to pour over $13 million into campaign coffers since 2000.

Fixing this loophole is simple—in fact, Brooklyn Democrat Dan Squadron proposed a bill to do just that, but it was upstate Republicans in the Senate who effectively killed the effort, including the chair of the Corporations Committee Mike Ranzenhofer (R-East Amherst).

On Monday, the Buffalo News’ Denise Jewell Gee wrote that there are only 17 days to call your legislators to get the LLC loophole closed, but she omitted the local connection.

Not only did Ranzenhofer shut down Squadron’s bill to close the LLC loophole, but Ranzenhofer got $94,000 from Glenwood, the company whose various and sundry LLCs, led by Leonard Litwin, have contributed $1,000,000 to Governor Cuomo using 19 individual LLCs. Litwin and Glenwood are linked to the Sheldon Silver criminal probe, as well. It was reported yesterday that the Cuomo Administration cited an ongoing federal probe into the state’s housing finance agency relating to loans made to Litwin’s company. It is as if all of Albany is under investigation, or cooperating with an ongoing one.

Rural and suburban Democrats, naturally, have a difficult time recruiting candidates to run against Ranzenhofer to begin with, but who would want to bother when Ranzenhofer can pull in that much money from just one allegedly corrupt company, and shuts down any effort to close the LLC loophole as part of his official duties? Why is Ranzenhofer getting a pass from local media on his connection to Litwin and Glenwood, and his blatant blocking of Squadron’s effort to eliminate the corrupt/ing LLC loophole? Here it is:

It becomes more and more obvious that public financing of elections is the only way to clean up this state.

Albany corruption is a bipartisan problem with easy solutions that are being blocked in an equally bipartisan manner. Ranzenhofer has been moistening legislative seats for 20+ years, accumulating state benefits and pensions without accomplishing much of anything. The fact that he’s actively blocking even the most basic and uncontroversial Albany reforms should lead to his removal from elected office. Reform or get out of the way.

Thruway

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Not unexpectedly, chairman of the New York State Thruway Authority Howard Milstein is doing for the Thruway exactly what he’s done for Niagara Falls under the auspices of his Niagara Falls Redevelopment, LLC. 

That is, nothing. 

In 2011, its revenue dropped by 1.1%, but its costs went up by 3.9%. Its operation is firmly stuck in the 1950s – so antiquated that it employs human beings to operate an automated ticket dispenser and hand toll tickets out to motorists. It is a caricature of idiotic work rules and redundancy. 

Governor Cuomo appointed Milstein to this post – is he pleased with how the Thruway is doing and what it’s done? Is anyone in the Albany delegation living west of Albany and within 30 – 40 miles of a Great Lakes sick of the fact that the state runs a 1950s-era toll road in 2012 that acts as a tax on motorists living within that geographic range?  I mean, legislators from the north have a freeway to get to Albany, those from the south have the free Taconic, and those from the Southern Tier have the free 86/17 and the I-88 to get to Albany. Legislators who live within 20 miles of the Thruway west of Albany should be taking that roadway’s cost and operation as if it was a discriminatory tax on their constituents. 

Enough is enough. 

The 47% and Irony

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Let’s personalize Mitt Romney’s denigration of the 47%. 

Cindy Nerger went to her local Kroger’s to pick up groceries for her family. She paid using her food stamps, but the cashier and then the store manager said that she still owed $10. Ms. Nerger replied that this was not possible, because she knew that food stamps covered everything she had bought. To this, the store manager replied, “Okay, just give it to her.” Nerger said, “see, I told you it was covered by food stamps,” to which the manager replied, “excuse me for working for a living and not relying on food stamps!'”

Granted, it was likely one of the few times the manager of a Kroger’s in the middle of Georgia was able to lord it over anyone else, but still.

When the manager insulted her in that way, Nerger turned and saw the other people in line, felt humiliated, and left the store in tears. 

Moocher. 

But here’s the thing. 

Nerger said she started receiving food stamps, formally known as the Supplemental Nutrition Assistance Program, when she became eligible for Medicare and Social Security Supplemental Income because of kidney failure in 2008. While she waits for a kidney transplant, she cannot work because of daily 12-hour dialysis treatments. Her husband runs a carpentry business. “If he doesn’t get a call [for a job] we don’t have any extra money for the month,” she said.

Food stamps have been a hot issue in the presidential campaign, with Republicans labeling President Barack Obama the “Food Stamp President” and charging that Obama has deliberately increased dependency on government. The Great Recession and its aftermath have pushed SNAP enrollment to 46.6 million, up from 34 million at the same time in 2009.

Heartbreaking, right? Well, here’s the other thing:

However much the campaign issues might resonate in her personal life, Nerger said she doesn’t have cable and hasn’t been following politics or the presidential election. Still, she doesn’t think much of either Obama or his Republican opponent, Mitt Romney.

“They’re all gonna kill us,” she said. “Most of the people that we have to choose from — Obama with his spending and his health care reform, and then Mitt Romney, he just wants to let poor people die, so either way we’re doomed. So I don’t see any point in voting.”

Scroll back up to the part where she’s a Medicare recipient. She is a beneficiary of a federally run single-payer health insurance program and denigrates Obamacare and “spending”.

WTF, people. 

The 1950s Called. They Want Their Toll Road Back

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According to its 2011 annual report, the New York State Thruway Authority’s toll revenue decreased by $7.1 million, or 1.1% from the previous year. Expenses, however, increased by $17.1 million, or 3.9%. Its results the year before were a bit better, with slightly higher revenue versus 2009 and a smaller increase in expenses, despite divesting itself of I-84 maintenance. 

The Authority is now desperate for a dramatic toll increase. A few weeks ago, it proposed a 45% increase on tolls for commercial trucks. The toll for a truck with three or more axles would increase from $88 to $127 to travel from New York City to Buffalo. 

Makes sense. Charge almost 50% higher tolls on the vehicles that deliver stuff to people, and the working people who drive them. 

It costs close to $20 to drive your car from the Major Deegan to the I-90/I-290 interchange. For the privilege, you can eat at some of the only Roy Rogerses in New York State. 

Recently, both Moody’s and S&P changed their outlook on the Thruway Authority to negative. It suggested that the Authority would need to raise tolls by more than 45% on trucks to adequately service its existing debt, before we get to the $5 billion plan to replace the Tappan Zee Bridge. Yet an increase in tolls would result in a likely change in customer behavior; i.e., people and trucks will seek alternate routes. 

The conservative Manhattan Institute points out that, in a tough economy, toll road usage and revenue have dropped in Spain, France, and Italy, which rely heavily on pay-as-you-go toll highways. Given that the I-80 through Pennsylvania and Route 17 / I-86 through the Catskills and Southern Tier offer up toll-free alternatives for traffic making the East-West trip within reasonably close proximity to the Thruway. If tolls go up by half, vehicles would probably seek to minimize the time they spend on the pay road. 

Legislators don’t care. Their cost to drive to Albany for session is reimbursed. The Thruway doesn’t care – they get free EZ-Passes. The entire operation is an anachronism. It’s poorly run, poorly maintained, expensive, and costs a lot to administer.  

Photo by g-trieber @ Flickr.com

Photo by g-trieber @ Flickr.com

The state DOT, which manages not just highways, but airports, seaports, and some public transportation, has an annual budget of $9.6 billion. The Thruway Authority, which manages the Thruway and Erie Canal, has an annual budget of over a billion dollars, and a little over half of its money is collected through tolls.

The obvious solution is abolition of the bloated, inefficient Thruway Authority. The problem is – if you incorporate it into the State DOT, it will cost money to maintain and service, and the money has to come from somewhere. Most likely, your pocket through gas tax hikes or similar. The nice thing about tolls is that it’s a pay-per-use system. But there’s another way.

If tolls are to be maintained, the Thruway could take a hint from Toronto’s 407 and make toll collection something that’s done at highway speeds. However, that’s costly, and cars without a transponder pay an extra fee for the license-plate-photograph privilege. Instead, many European countries share the cost burden of highway maintenance through sales of stickers.

For tourists, we could follow the Austrian model where €8 buys you 10 days of unlimited travel on that country’s highways. Another possibility would be to follow the Swiss model, where SFr 40 buys you a year’s worth of travel on that country’s impeccably maintained Autobahnen, Autostrade, and Autoroutes.

Police spot checks look for scofflaws. If caught without a vignette, the Swiss charge you a SFr 200 fine, plus the cost of a vignette. The Austrians will fine you €120 on the spot.  Given that it now costs almost $20 to get from the Major Deegan to the PA line, a $10 sticker for 10 days’ worth of highway travel is a bargain. So is $40 for the entire year. Vignettes could be sold at welcome centers entering New York or leaving bordering states. They could be sold online, in advance, or, as they are in Hungary, even via cell phone text message. No more toll barriers, no more toll collectors.

Hungary: Buy vignette by mobile phone

The point here is that the roads need to be paid for, and it makes sense for the people using them to pay for them. People could avoid buying the stickers by using secondary roads, so it’s completely optional. We could abolish not only the entire Thruway Authority, but most of its associated, dedicated toll-collecting costs. We could get rid of its obnoxious exclusive contracts with towing and wrecker services on the Thruway, and get rid of EZ-Pass and its associated costs for passenger vehicles.

It’s time for the Thruway to modernize, streamline its operations, stop gouging travelers, and think differently. 

Buffalo: Read These

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Photo by Flickr user Sunny Hasija

1. It’s astonishing that racist behavior and actions like those described in this lawsuit could happen in WNY, by adults, in the past decade. If there’s a silver lining here, it’s that a federal court jury in Buffalo found this systematic destruction of a worker’s life absolutely abhorrent, and awarded tens of millions of dollars in punitive damages against the Luxembourg-based steel conglomerate that did very little to stop it, or punish the perpetrators. 

2. Remember that secretive millionaire wunderkind from Cleveland who bought some of the most expensive and exclusive houses in WNY, and was planning to buy and renovate several downtown structures? His name is Michael Wilson. He was a fraud, and his financial “empire” existed only in Wilson’s mind. He even created a phantom financial professional, complete with LinkedIn profile, to help dupe unwitting investors. Wilson has since been indicted by a federal grand jury and fled the country.  His brother is awaiting trial, likely serving to attract Wilson back to WNY to face the music for his own misdeeds. When we talk about enterprise, investigatory journalism, Kevin Purdy’s compelling story should win an award – and it’s published in the Buffalo Spree. Who was Michael Wilson? Yet another carpetbagging huckster – reminiscent of the Simpsons’ monorail developer, Lyle Lanley – coming to western New York to promise us renewed relevance and prospective riches. All we have to do is, e.g., donate millions in money and land to build a Wizard of Oz theme park; or rely on the promises of a quixotic but charismatic Iraqi-Briton to miraculously complete only his second project ever, the renovation of the Statler Towers.  Buffalo’s renaissance, when it comes, will come because of hard work, planning, vision, and good government. Silver bullets don’t work any better than earnest crowdsourcing. 

3. Donnie Burtless from the local food blog Buffalo Eats interviewed retired Buffalo News restaurant critic, Janice Okun. It’s an interesting, short retrospective from someone who was once a pioneer. 

4. I can’t figure out which one is more socially acceptable – being some level of excited about Nik Wallenda’s tightwire walk across Niagara Falls, or to denigrate it altogether. 

5. Hey, folks – a new activist group called Effective NY wants a constitutional convention, and it’s run partly by YNN political host Liz Benjamin’s father.