October 12, 2015
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CONTENTS October 12, 2015
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CITY
Experts say comptroller’s rejection of homeless shelter contracts is ‘illegal’ By Jeff Stein from New York Nonprofit
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STATE
Obama’s tuition-free community college proposal would have a hefty price tag By Ashley Hupfl
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BUFFALO
In uphill Erie County executive race, candidate’s message is key By Justin Sondel
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UPSTATE HUNGER GAMES
Regions face off for state funding By Ashley Hupfl
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SPOTLIGHT: RACING, GAMING AND WAGERING An update on the winning casino bids … the future of the New York Racing Association … the push to legalize online gambling
Michael Gareth Johnson Executive Editor
Quick. What’s the Upstate Revitalization Initiative? Doesn’t ring a bell? What about the Upstate Hunger Games? That probably triggers some neurons in your brain as you recall the $1.5 billion competition that has pitted seven upstate regions against one another for three $500 million prizes. We didn’t come up with this term. Google searches don’t really make it clear who was the first to coin the phrase, whether it was a disgruntled lawmaker or one of the brilliant members of the Legislative Correspondents’ Association. But one thing is clear: It is now the accepted term for the high-stakes handout of state resources. Here at City & State, the phrase gave us many opportunities to take the comparison several steps further – depicting elected officials as characters from the movies and books and utilizing artistic elements satirically to compare Suzanne Collins’ cit yandstateny.com
dystopian fictional world to New York. Art Director Guillaume Federighi embraced this for our cover, revising the series’ logo with our state bird (the Eastern bluebird) to tailor it to the New York competition. In the story itself, Albany reporter Ashley Hupfl takes a deep dive into the process, looking at the positives and negatives of this program and recapping the main elements of the seven bids. The process has a lot of detractors, who say regions should be working together, not fighting, and fear that the winners may be picked based on politics, not need. Gov. Andrew Cuomo has countered that argument with a consistent theme from his time in office – that competition breeds better results. While that ideological fight is sure to go on for ages, the reality is that the uneven distribution of such a large chunk of cash will surely have a lasting impact on the direction of many upstate communities. A decade from now, one region of the state may be thriving while its neighboring region is struggling – and this competition could be primarily, or at least partly, responsible. The magazine also features a spotlight section on racing, gaming and wagering, in which we tackle some of the timely issues facing the shifting gambling landscape in New York, from the new casino licenses to the uncertainty over legalizing online betting to the future of the New York Racing Association. Gambling is a growing piece in the puzzle of economic growth – especially upstate, where three casinos have been recommended – and it is deeply intertwined with the state’s economic development efforts like the Upstate Revitalization Initiative (or the Upstate Hunger Games, in case you forgot).
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EVENT: ON DIVERSITY
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EVENT: HOUSING HEALTH EQUITY
Officials, experts weigh in on diversity and MWBE contracting in New York
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Advocates tackle the ‘next frontier’ in fight against secondhand smoke By Michael Gareth Johnson
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GRAD SCHOOL SUPPLEMENT
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OPINION
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An open letter from Evan Siegfried to Bill de Blasio … Yuval Sheer on the Raise the Age fight ... Denise Richardson, Marcia Bystryn, Thomas Wright and John Raskin on funding the MTA ... Richard Brodsky on the upstate secession movement ... Bruce Fuller on de Blasio’s pre-K initiative
BACK & FORTH
A Q&A with American Pharoah manager Justin Zayat
October 12, 2015
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Cover: by Guillaume Federighi
city & state — October 12, 2015
FROM THE EDITOR’S DESK
In 2014, more than 1.7 million people attended live races at New York Racing Association tracks. 61 Broadway, Suite 2235 New York, NY 10006 Editorial (212) 894-5417 General (646) 517-2740 Advertising (212) 894-5422 info@cityandstateny.com
CITY AND STATE, LLC Chairman Steve Farbman
The average daily betting handle on NYRA races totaled more than $10 million.
President/CEO Tom Allon tallon@cityandstateny.com PUBLISHING Publisher Andrew A. Holt aholt@cityandstateny.com Vice President of Advertising Jim Katocin jkatocin@cityandstateny.com Events Director Jasmin Freeman jfreeman@cityandstateny.com Director of Marketing Samantha Diliberti sdiliberti@cityandstateny.com
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Business Development Scott Augustine saugustine@cityandstateny.com
The state saw $7.25 billion in sales from the traditional lottery, and a $1.91 billion net win from slots.
EDITORIAL Executive Editor Michael Johnson mjohnson@cityandstateny.com Associate Editor/Senior Correspondent Jon Lentz jlentz@cityandstateny.com Web Editor/Reporter Wilder Fleming wfleming@cityandstateny.com Albany Reporter Ashley Hupfl ahupfl@cityandstateny.com
That $9.16 billion total produced a profit of $3.11 billion for state education.
Buffalo Reporter Justin Sondel jsondel@cityandstateny.com Staff Reporter Sarina Trangle strangle@cityandstateny.com Editor-at-Large Gerson Borrero gborrero@cityandstateny.com Copy Editor Ryan Somers rsomers@cityandstateny.com
The stakes have never been so high.
Editorial Assistant Jeremy Unger junger@cityandstateny.com PRODUCTION Creative Director Guillaume Federighi gfederighi@cityandstateny.com
CITY & STATE — October 12, 2015
Senior Designer Michelle Yang myang@cityandstateny.com
For more, see our Racing, Gaming and Wagering Spotlight, starting on page 18.
Source: NYRA and the state Gaming Commission.
Marketing Graphic Designer Charles Flores cflores@cityandstateny.com Illustrator Danilo Agutoli Digital Strategist Chanelle Grannum cgrannum@cityandstateny.com Multimedia Director Bryan Terry bterry@cityandstateny.com
Copyright Š2015, City and State NY, LLC
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city & state — June 15, 2015
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A DAY AT THE RACES
city & state — October 12, 2015
MIKE LIZZI
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Last October, members of the state Senate and Assembly from Westchester County, Long Island and New York City were once again invited to the annual Legislators’ Pace at Empire City Casino in Yonkers. The lawmakers suited up, goggles and all, and competed against one another in three harness races (with a little help from professional drivers). There was no gambling involved – or so they say. The event featured Assembly members Andrew Raia, Keith Wright, Francisco Moya, Andrew Garbarino, Gary Pretlow, Joseph Saladino, Michael Benedetto, Michael DenDekker and Michaelle Solages and state Sens. Martin Dilan, Ruth Hassell-Thompson and Phil Boyle. Dilan, Garbarino and Boyle all channeled their inner Ben-Hurs in the three races and emerged victorious. Unfortunately for thrill-seeking lawmakers, there was no Legislators’ Pace this year, because Yonkers Raceway hosted the prestigious International Trot this past weekend after a 20-year hiatus. For more on racing and gaming in New York, check out our spotlight section, starting on Page 18. cit yandstateny.com
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CIT Y
THE STING OF REJECTION EXPERTS SAY COMPTROLLER’S REJECTION OF HOMELESS SHELTER CONTRACTS IS ‘ILLEGAL’
city & state — October 12, 2015
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Giuliani vs. Hevesi. Bloomberg vs. Thompson. Bloomberg vs. Liu. Given the historic – and often litigious – disagreements between New York City’s mayors and comptrollers, the current standoff between Bill de Blasio and Scott Stringer over the registration of homeless shelter contracts is far from shocking. However, as dozens of shelter contracts remain in limbo, some legal experts are suggesting that the comptroller has exceeded his authority in rejecting, or “kicking back,” contracts. And nonprofit leaders say the ongoing dispute is hurting their ability to provide services to homeless New Yorkers. “Late payments and delays in contract registration don’t just cause headaches, they hinder organizations and impact service delivery,” said Michelle Jackson, associate director and general counsel for the Human Services Council, which advocates on behalf of many of the city’s homeless shelter providers. “Nonprofit workers on these contracts are placed in limbo, working in temporary spaces and starting programs without necessary documents and funding,” Jackson continued. “And ultimately it’s the clients who suffer – the delays divert limited resources away from programs, impact staff morale, and make it difficult for nonprofits to plan and invest in programs at the outset.” Registration of contracts for city-run homeless shelters has been an ongoing point of contention between the mayor and the comptroller, especially since a damning Department of Investigation report in March catalogued the unsafe and squalid conditions of many shelter sites. The report was unforgiving in its assessment of the Department of Homeless Services’ oversight of 25
A KATZ / SHUTTERSTOCK.COM
By JEFF STEIN from NEW YORK NONPROFIT
Some legal experts are suggesting New York City Comptroller Scott Stringer has exceeded his authority in rejecting homeless shelter contracts.
sites, saying, “DHS should, but does not, enforce building maintenance or ensure violations are resolved. It should, but does not, force repairs or regularly do its own repairs, nor does it seek assistance from other agencies in getting repairs made. As a result, many shelters operate with existing violations that make life unsafe for its children and family residents.” The report also highlighted that many city-funded homeless shelters have been operating without contracts on an emergency, per diem basis, making them both costlier and harder to hold accountable.
“With no contracts, providers and landlords are not subject to competition, and are not held to enforceable contract terms that could, in theory, require them to maintain their buildings or make needed repairs, or else be subject to penalties such as rent reductions or fines,” the report said. In response, DHS has led an intensified effort to improve conditions at city-run sites and establish contracts for sites that have been operating outside of the contracting system. According to a spokesperson, DHS’ Shelter Repair Squad has completed
more than 2,000 inspections over the past several months, clearing more than 7,000 violations and completing almost 3,000 repairs. The spokesperson also said 83 percent of the violations cited in the DOI report have been cleared. However, according to the comptroller’s office, these efforts have been insufficient in ensuring the safety of many sites that the city has attempted to bring under contract. Over the past 20 months, Stringer’s office has rejected 33 homeless shelter contracts, saying 18 have open violations, and 21 contracts are missing cit yandstateny.com
a routine site review inspection, which DHS uses to evaluate safety at the sites. City officials say the rejected contracts represent tens of millions of dollars in outstanding payments to nonprofits, which provide a total of nearly 2,000 beds for single adults and nearly 900 family units. Some of the rejected contracts are with nonprofit organizations, such as Samaritan Village, that the city has partnered with for decades. Samaritan Village’s contract for operating a shelter at the former Pan American Hotel in Elmhurst – which initially opened as an emergency site – has been rejected three times over the past several months, with the comptroller citing numerous health and safety concerns. Despite the cost to providers – some of which have accepted bridge loans to keep their operations going – the comptroller has insisted that his office should not – and cannot – register contracts without documentation showing that sites have either corrected violations or have a concrete plan to do so. His office also says that in many instances, DHS has been unresponsive to requests for several months. “The Department of Homeless Services should get its act together, make sure shelters are safe and provide the very basic materials required for us to register these contracts,” said John McKay, the comptroller’s communications director. “The fact that they have not done so, despite our offers to help them navigate this process, speaks to a lack of professionalism and an inability to handle the details necessary cit yandstateny.com
to run this city.” But some legal experts say the comptroller’s refusal to register contracts is an overreach of authority. Roderick Hills, a New York University School of Law professor who specializes in local government law, cited Section 328 of the city charter, which states that the comptroller must register a contract unless there is not enough funding for the contract to be paid, the Mayor’s Office of Contract Services has not certified the contract, or there is reason to suspect corruption. Given that none of the homeless shelter contracts have been rejected on those grounds, Hills said the comptroller is operating outside of his office’s authority. “For the comptroller to slow down or stop the mayor’s contracting policy is frankly illegal,” Hills said. “The charter makes the comptroller a warning light, not a brake. The mayor is the driver, and all the comptroller can do is cry foul, not stop the car. It’s up to the mayor to decide whether to listen.” The comptroller’s office, meanwhile, says it is justified in rejecting contracts and sending them back to DHS with requests for additional documentation, citing a Procurement Policy Board rule that lays out which documents should be included in all contracts and allows the comptroller and the head of the Mayor’s Office of Contract Services to agree upon additional requests. But legal experts have suggested that the Procurement Policy Board rule is not sufficient grounds for
CIT Y
“And even if there are some more substantive issues,” Simpson continued, “it’s unfair and illogical to think that taking funding away will make anything better. For the sake of the nonprofits trying to do this work, it’s important for the comptroller and the mayor to figure it out. Contracts should be registered on time, or deemed as registered, and providers should be paid on time.” The dispute between the two offices may be exacerbated by the city’s payment system, which, according to a knowledgeable source who spoke on the condition of anonymity, does not accurately reflect the offices’ roles as defined in the charter. “To pay anybody for anything, the city has to use a database system called the Financial Management System, or FMS,” the source explained. “When they built this system in about 1999, the city didn’t specifically build in an override option so the mayor could push the button when the comptroller chooses not to register a contract, although that override power exists in the charter. Only the comptroller can push the button so that payments can be made.” Despite the differences in legal interpretation and the complex logistics of the city’s contracting system, city officials have pledged to
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“The charter makes the comptroller a warning light, not a brake. The mayor is the driver, and all the comptroller can do is cry foul, not stop the car.” - Roderick Hills, professor, New York University School of Law be so hard.” But Simpson argues that the comptroller should hold city agencies and nonprofits accountable in ways that recognize the realities – and legal limitations – of the current system. “City agencies are slow at getting contracts done. Many programs pay less than our services actually cost, and nonprofits are not always perfect,” Simpson said. “Of course the comptroller should hold city officials and nonprofits accountable. There’s huge room for improvement and there’s lots of ways to draw attention to that. But it’s not OK to stop paying for services because a city agency screws up the paperwork.
keep services for the homeless moving forward. “Ensuring homeless families in need are housed and receive the services they need is our first and foremost priority, and we won’t let any paperwork issues impede that,” said First Deputy Mayor Anthony Shorris. “We’ve been aggressively repairing shelters to ensure they’re safe for homeless families and individuals. We’ve also consistently provided the comptroller’s office the information and paperwork they request, but these nonprofits provide critical services to New Yorkers in need and are owed funding – we have to remedy this situation.”
city & state — October 12, 2015
MONKEY BUSINESS IMAGES
Over the past 20 months, Stringer’s office has rejected 33 homeless shelter contracts.
delaying the registration of a contract, and that such delays deprive nonprofit providers of the funds they need to make the very improvements cited in the contract rejections. “The PPB rule doesn’t override the charter and it doesn’t let the comptroller do the very things the courts have repeatedly said not to do,” said Marla Simpson, a nonprofit executive who was the head of the Mayor’s Office of Contract Services from 2003 to 2012. “Nonprofits are lifelines for New Yorkers who need services. When a well-known community-based group steps in and agrees to provide much-needed programs, if the goal is to improve conditions for clients, the last thing we ought to do is to prevent the city from paying for the work.” McKay, however, says the comptroller is simply providing the oversight needed to ensure the safety of New Yorkers while acting as a check on the mayor’s authority, which is in the spirit of the charter. “The charter has a separation of powers for a reason – it’s to protect the integrity of the contracting process,” McKay said. “These are huge contracts, worth millions of dollars. We’re not asking for perfection here, we’re asking them to get complete contract filings to us. That shouldn’t
STATE
THE COST OF FREE
OBAMA’S TUITION-FREE COMMUNITY COLLEGE PROPOSAL WOULD HAVE A HEFTY PRICE TAG IN NEW YORK
Since President Barack Obama
city & state — October 12, 2015
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proposed providing community college students with free tuition, New York has entered into negotiations to make that dream a reality, but observers are worried the state is rushing into a commitment it cannot fiscally support. Last month, the New York Post reported Gov. Andrew Cuomo was in discussions with the White House to provide free tuition at the state’s community colleges. The federal government would require states to pick up 25 percent of the cost. A source told the Post that Cuomo is offering up to $500 million to support the goal. However, other details about the plan are scarce. “I think everyone would be excited to provide free community college to all of our state’s residents and I think it’s something that’s absolutely needed,” said Ron Deutsch, director of the Fiscal Policy Institute. “But as we say in Albany, whenever a trial balloon is floated, which is what this seems to be, I would suggest that the devil’s in the details.” Deutsch said it costs about $1.9 billion to operate the SUNY community colleges and another $890 million for CUNY community colleges. “In reality, the state hasn’t even been meeting its (current) commitment (to fund community colleges) and over the years the burden has been placed on students,” he said. “So I’d want to make sure any plan that gets put in place not only covers the tuition costs, but also makes sure community colleges aren’t left holding the bag for this move.” E.J. McMahon, president of the Empire Center for Public Policy, raised concerns about how the state would fund the $500 million and compared the move to the state’s
Medicaid program. “The cost of Medicaid was a tiny fraction of what it turned out to be in a decade,” McMahon said. “When you make something free it costs more. It’s an old quote. If you think community college is free now, wait until you see what it costs when it’s free.” For in-state students, SUNY community college tuition costs $4,210 annually and CUNY community colleges cost $4,800 annually. “The funding question is a huge one. Where Cuomo gets the idea that he has $500 million to throw around is one question,” McMahon said. “The other big observation, there are serious questions about whether the community college sector is actually performing as it should.” Carol Kellermann, president of the Citizens Budget Commission, raised concerns about what will happen if admissions increase. “If (tuition isn’t raised), that means the operating support that the city and state provide is going to grow,
because expenses will grow,” she said. “I think part of the intent of doing this would be to make it possible for more people to go, and it would drive up the number of people who could go and it would drive up the costs – you’re going to need more classes, you’re going to need more space and if you can’t get that out of tuition then the state and the city are going to pay for that and those costs are going to go up.” Kellermann suggested that increased funding may be better used helping existing students graduate. A Manhattan Institute report found community colleges suffer from serious flaws and have very low graduation rates. Another study conducted by MDRC, a nonpartisan education and social policy research organization, found only about 20 percent of community college students graduate with an associate degree within three years. “More attention needs to be paid on how to get people to graduate,” said Kellermann, who previously worked at
CUNY on a pilot program to increase graduation rates at community colleges. “A tuition program that enables some of them to go full-time, which helps them graduate more quickly, would be great. But it has to be planned and thought out carefully so it achieves those objectives.” Deutsch disagrees. He says providing tuition-free access to community colleges would boost graduation rates. “I would argue a lot of people don’t graduate because they can’t continue to afford to pay for it,” he said. “They go into it with great intentions about being able to afford these costs and then after time can’t continue to do so. I think that’s another example of why additional state aid is needed.” SUNY Chancellor Nancy Zimpher said the national community college graduation statistics are incomplete and often misleading, since they do not account for transfer and part-time students and those who attend multiple institutions. Additionally, SUNY has pledged to increase its completion rate from 90,000 degrees completed in 2014 to 150,000 degrees completed over the next five to 10 years. Zimpher is also on the College Promise Advisory Board, which was convened by Obama to advocate for free and high-quality community college education. “It’s important for the state to partner with our students and families so that the students don’t bear more of the weight,” Zimpher said. “So actually investing in the concept of free community college would help the state get back up to where they are investing at least as much as our students. I don’t think the country meant for our students to carry more of the burden than our states.” cit yandstateny.com
MEGA PIXEL / SHUTTERSTOCK
By ASHLEY HUPFL
BUFFALO
‘IDEAS – THAT’S THE MAIN THING’
IN UPHILL COUNTY EXECUTIVE RACE, CANDIDATE’S MESSAGE IS KEY
Assemblyman Ray Walter picked NRG’s soon-to-be-shuttered Huntley power plant as the backdrop for his latest campaign proposal in his bid to unseat Erie County Executive Mark Poloncarz. The plant’s closing is sure to create a tax revenue shortage for the Town of Tonawanda and the KenmoreTonawanda school district, but Walter says his new plan for how sales tax revenue will be distributed in the county would help ease residents’ burden. “Businesses closing put a greater burden on hardworking taxpayers of Tonawanda,” the Amherst Republican said. “If Tonawanda residents receive their fair share (of sales tax revenue), it will help cover the cost of the Huntley plant.” Walter’s tax plan, which he calls the Fair Share plan, would change the way that sales tax is divided, taking the larger portion that goes to the county’s three cities – Buffalo, Lackawanna and Tonawanda – and redistributing it in a way that would see each municipality get approximately the same amount for each resident. The plan is a key platform in an ambitious race that has him up against an opponent with a number of advantages, perhaps most importantly a sizable war chest. Poloncarz’s campaign last reported having more than $646,000 on hand in July, while Walter’s recently formed county executive campaign fund reported having $52,356. The campaign cash chasm isn’t Walter’s only challenge. The county has low unemployment and largescale construction projects, so it is difficult to criticize Poloncarz on the economy. The incumbent Democrat was also boosted by positive headlines for his handling of last year’s super snowstorm, including praise from Gov. Andrew Cuomo. In the aftermath, cit yandstateny.com
Erie county executive candidate Assemblyman Ray Walter speaks at Huntley power plant. Poloncarz did receive some criticism of his handling of the storm, but mostly from officials in less populated areas of the district. Walter also has a name-recognition problem. While well-liked in his Assembly district, Walter’s status as a member of the minority in a state house dominated by Democrats does not give him the kind of visibility that comes with being at the helm of county government. Aware of all this, Walter has been hitting the campaign trail hard, touring the county over the last few weeks and making dozens of stops at diners and community events to reach out to voters. Walter acknowledged the advantages for Poloncarz, whom he describes as a “caretaker county executive,” but said he believes he can overcome those obstacles by getting the message out about his tax plan and other initiatives – the kind of proactive governing he says his opponent does
not engage in. “We have ideas,” Walter said. “That’s the main thing. People are crying out for ideas on how to bring prosperity to all of Erie County.” Walter will be getting help from his party, at least at the county level. Erie County’s GOP Chairman Nick Langworthy, who was on hand for the candidate’s press conference, said county Republicans will be there to support Walter, financially and otherwise. “We’re completely dedicated to this race,” Langworthy said. “Ray will have the money to get his message out.” For a while, it didn’t look certain that the GOP would find a candidate to take on Poloncarz. Several Republicans – including County Clerk Chris Jacobs and County Comptroller Stefan Mychajliw – toyed with the idea before ultimately bowing out. Langworthy said he believes the party found the right candidate to shake Poloncarz from his position, and
that Walter’s aggressive campaigning is going to end up surprising the incumbent. “(Poloncarz) think’s he’s got a comfortable lead and he’s going to sit on it,” Langworthy said. Poloncarz said he is confident that his record will give him the votes he needs to keep his seat. Reached by phone hours before a ribbon cutting to celebrate the completion of capital improvements at a Buffalo park, Poloncarz disagreed with Walter’s and Langworthy’s claims that he was not out meeting with constituents and getting his message out – and cited the ribbon cutting as a prime example. Responding to claims that he has a lack of vision or is a passive leader, Poloncarz pointed to the reduction in the unemployment rate, noting that he walked into the county executive’s office when the rate was almost 9 percent following the tenure of Republican Chris Collins. The rate is now 5.1 percent. “We have tremendous plans with regards to our economy and health and human service delivery in Erie County,” Poloncarz said. “I mean, the greatest way to affect the residents of this community and to create a stronger Erie County is to create jobs, and that’s exactly what we’ve done these last four years.” Poloncarz said that if he seems comfortable in the race, it’s because he has shown that he can run a stable county government, working with the Legislature to pass budgets that create modest surpluses each year without raising taxes, while also maintaining services for residents. “I’m running on my record because I’m proud of my record,” Poloncarz said, “and I believe people will respond to it.”
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city & state — October 12, 2015
JUSTIN SONDEL
By JUSTIN SONDEL
city & state — October 12, 2015
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cit yandstateny.com
THE UPSTATE
HUNGER GAMES REGIONS HOPE THE ODDS ARE EVER IN THEIR FAVOR
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powerful, controlling leader announces a competition. Region is pitted against region, neighbor against neighbor, with most of the participants guaranteed to lose. Some question the high-stakes contest, but despite deep misgivings, everyone ultimately plays along. No, it’s not “The Hunger Games.” It’s the “Upstate Hunger Games.” The Upstate Revitalization Initiative, as the competition is officially called, was unveiled by Gov. Andrew Cuomo during his State of the State address in January. Out of seven eligible regions in upstate New York, the governor said, three would emerge victorious, garnering $500 million apiece. Long Island and New York City, deemed less needy by Cuomo, were excluded from the competition for a piece of the $1.5 billion pot diverted from the more than $5 billion the state received in settlements from banks for financial violations. The competition is built on Cuomo’s Regional Economic Development Council program, which in 2011 divided the state into 10 regions that compete for state funding each year, with top awards for any one region typically in the $80 million to $100 million range. For this new competition, leaders of the REDCs joined forces with local mayors to vie for one of the $500 million prizes. The initiative also seeks to replicate the governor’s “Buffalo Billion,” the 2012 influx of state dollars into economic cit yandstateny.com
development projects in the Buffalo area – because of which Western New York has also been excluded from the competition. This leaves the Capital, Central New York, Finger Lakes, Mid-Hudson, Mohawk Valley, North County and Southern Tier regions. Each dutifully submitted their economic development proposals by the Oct. 5 deadline, and the winners are to be crowned by the end of the year. Yet early on, the competition was dubbed Cuomo’s “Hunger Games,” a reference to a popular book and film series portraying a post-apocalyptic world in which an authoritarian government randomly selects youths to face off in a battle to the death. Lawmakers grumbled that the process granted too much control to the governor, with some predicting that winners would be selected based on political considerations. Some officials questioned why four regions had to lose (although the administration insists the losers will be awarded other funds). Others warned of a potential arms race, with some regions hiring expensive consultants to outdo each other and poorer areas left behind. Still others argued that the cash would be better spent on sorely needed infrastructure upgrades than on flashy economic development projects. “That’s not consistent with the idea that we are ‘the family of New York,’” Syracuse Mayor Stephanie Miner told The Wall Street Journal. “(Cuomo) makes his statements, and then he comes here and says Syracuse has to pay for its own water mains?” But for the governor, it was just the
latest in a series of contests aimed at shaking up how state government distributes funds. “I believe in competition,” Cuomo said in January. “If I just gave you the money, you wouldn’t do all the hard things you have to do to get the money. The competition amongst yourselves brings up the performance of everybody.”
“T
he theory behind (the Upstate Revitalization Initiative) is that you dump money into favored industries to create the beginnings of some critical mass and then the critical masses take off on their own economically,” said E.J. McMahon, the president of the Empire Center for Public Policy. “It’s been tried elsewhere around the world and it typically doesn’t work. If it was just a matter of spending money, how come it hasn’t been done before?” With this competition, McMahon added, the state could be creating future operating costs that the cities would be responsible for once the funding runs out. Rahul Jain at the Citizens Budget Commission questioned whether the Regional Economic Development Councils are successful to begin with. “The REDCs at this point have not done a great job talking about their performance,” Jain said. “We don’t know a ton of how many of the projects actually end up hitting their performance goals, both in terms of completion, investment and job creation. That’s a concern if you’re going to put more money into a program that really hasn’t fully shown
what it’s capable of doing.” Jain added that the regions are supposed to be coordinating with one another to help promote economic development, not fighting. “There’s a benefit to using the competition structure, but if it ends up getting used on state infrastructure needs then you would hope the agencies that are there right now could dole off the money in a more sensible fashion,” he said. “It’s not like there’s not plenty of infrastructure in the state that actually does need to be fixed right now. So putting money into those projects instead of issuing more debt, which the state has a ton of, might be a smarter way of doing things.” Critics say many upstate cities have serious infrastructure problems that won’t be solved by whatever comes out of the contest. Miner, the mayor of Syracuse, has repeatedly called for using the state funds instead to replace failing water mains in her city, a request Cuomo dismissed. “The money that’s being used in this so-called competition could go a long way toward helping these cities catch up with their very, very significant infrastructure problems,” McMahon said. “But that’s no fun. Something new and gleaming and cool like tech life is more glamorous than fixing something you can’t see.”
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ut despite the complaints and concerns from some corners, the REDC co-chairs joined other elected officials in praising Cuomo’s approach. Continued on Page 16...
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city & state — October 12, 2015
By ASHLEY HUPFL
REDC CO-CHAIRS
THE JOEL SELIGMAN President, University of Rochester
DANNY WEGMAN CEO, Wegmans Food Markets
DISTRICTS
Rochester fiscal stress score: 14.2% Building off of the state and federal government’s initial investment in photonics in Rochester, the Finger Lake region’s plan focuses on other specific areas of optics, imaging and laser technology. Because the region produces about a quarter of the state’s agricultural output, the plan also focuses on food production, sustainable farming and agri-tourism. The plan touts progress with the Eastman Business Park, the Rochester Downtown Innovation Zone and the Western New York Science and Technology Advanced Manufacturing Park and argues the funding would expand growth in these hubs and support other emerging centers over the next five years. REDC CO-CHAIRS
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ROB SIMPSON President and CEO, CenterState
KENT SYVERUD Chancellor, Syracuse University
Syracuse fiscal stress score: 25.8% The CNY Rising plan aims to capitalize on growing global market opportunities, particularly in unmanned systems, with an initial focus on the testing, development and manufacturing of unmanned aerial systems. To expand on the state’s agriculture business, the region’s plan would create a “Grown in NY” certification and global brand for state products and would launch an effort to build an aseptic food packaging facility to extend the shelf life of state products. To help the area’s economy grow, the plan proposes enhancing the availability of seed capital and will focus on job creation for veterans and minorities. REDC CO-CHAIRS REDC CO-CHAIRS
HARVEY STENGER President, Binghamton University
TOM TRANTER President and CEO, Corning Enterprises
CITY & STATE — October 12, 2015
Binghamton fiscal stress score: 20.8% The Southern Tier’s plan aims to promote advanced manufacturing, health care, culture and high-tech development. Revitalized urban centers, such as Binghamton, Johnson City and Endicott, will capitalize on public-private collaborations and the growing presence of Binghamton University and become “innovation districts.” It proposes a mix of projects to develop agriculture technology to grow and transform agriculture and food production, processing and distribution across the region while strengthening links to tourism and manufacturing. A program to promote the region’s quality of life and capacity for innovation would be developed and implemented.
JAMES BARBA President and CEO, Albany Medical Center
ROBERT JONES President, University at Albany
Albany fiscal stress score: 67.5% The Capital 20.20 plan aims to invest in the health-tech and clean-tech industries, arguing New York’s modern high-tech growth was largely written in the Capital Region. Leveraging the 20-plus universities and colleges in the region, the plan calls for an investment in education to remedy skills shortages. The plan focuses on investment in six urban areas – Albany, Glens Falls, Hudson, Saratoga, Schenectady and Troy – to support small businesses and tackle blight in challenged neighborhoods, while connecting workers to jobs and improving transportation equity. CIT YANDSTATENY.COM
REDC CO-CHAIRS
ANTHONY COLLINS President, Clarkson University Plattsburgh fiscal stress score: 41.3%
GARRY DOUGLAS President, North Country Chamber of Commerce
The North Country’s plan aims to install cutting-edge automated food production systems in greenhouses to transform the way food is grown in the United States, which would help create 175 jobs and focus on hiring veterans. Because of Lake Placid’s Olympic heritage, the plan aims to position the region to be the only location in the world to host a third Winter Olympic Games to attract other international sporting events. Additionally, the proposed Laurentian Aerospace project would be the first in the U.S. to utilize an automated docking system for the maintenance of wide-bodied aircraft. REDC CO-CHAIRS
ROBERT GEER Senior Vice President and COO, SUNY Polytechnic Institute
LAWRENCE GILROY III President, Gilroy, Kernan & Gilroy Inc.
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Utica fiscal stress score: 51.3% Mohawk Valley’s plan aims to build new regional wealth through technological and STEM-related industries, such as nanotechnology, cybersecurity and unmanned aerial systems, with the goal of doubling the number of STEM jobs by 2030. The region’s industrial base has kept pace with dairy processing and so the plan seeks to invest in next-generation farmers and close the skills gap between hard-to-place workers and agricultural, craft brewing and food processing opportunities. The expansion in craft food and beverage would lead to increased tourism, with the goal of adding 50 new tourism firms by 2020. REDC CO-CHAIRS
LEONARD SCHLEIFER President and CEO, Regeneron Pharmaceutical
Yonkers fiscal stress score: 60.4% To stimulate job creation and prevent youth flight, the Mid-Hudson region’s plan calls for downtown revitalization at many river, hilltop and crossroads urban centers. Because of its proximity to New York City, the plan aims to make the region a premier tourist destination by investing in Stewart International Airport and to market the Culinary Institute of America as a tourist destination similar to Napa Valley. To increase job creation, the plan aims to develop requirements for paid internships and hard-to-place workers while fostering an innovative culture and boosting private-sector investment. CIT YANDSTATENY.COM
CITY & STATE — October 12, 2015
DENNIS MURRAY, President, Marist College
city & state — October 12, 2015
16 Utica Mayor Robert Palmieri said the competition has boosted morale in his region, which is already buzzing over a separate economic development project that was recently announced, the Nano Utica center. In August, General Electric and an Austrian sensor manufacturer announced they would invest an additional $2 billion into Nano Utica. The Mohawk Valley, which includes Utica, submitted a plan that builds off its technology industries and aims to double the number of its science, technology, engineering and mathematics jobs by 2030. Like several other regions, it also calls for investment in local farms, craft brewing and food processing. “I think for a long time people have looked at Albany and driven past this region and that’s no longer the case,” Palmieri said. In the Capital Region, where Albany already boasts a nanotech complex, the proposal focuses on high-tech sectors. The plan also calls for an investment in its six urban areas to support small businesses and tackle blight in neighborhoods. Despite the existing nanotechnology project in Albany, the city has been
struggling. Mayor Kathy Sheehan said during her budget presentation that the city is banking on an infusion of $12.5 million in new state aid, warning that it would be insolvent without the funds. “One of the challenges that has been identified is the concentrations of poverty in our urban centers,” Sheehan said. “The Capital 20.20 plan, which is a 5-to-10-year plan for growth in the Capital Region, makes a compelling case for investment, notwithstanding whether or not there’s a half a billion dollars at the end of that road.” In July, Cuomo and U.S. Vice President Joseph Biden announced a new $600 million photonics manufacturing center to be sited in downtown Rochester. As a result, the Finger Lakes’ proposal focuses on other areas of optics, imaging and laser technology. Beyond the Rochester area, the Finger Lakes region is also known for its food and wine production, and its plan calls for greater investment in agricultural tourism as well. “We are in a position right now where Rochester is moving forward,” Rochester Mayor Lovely Warren told
City & State. “We have turned a corner and the Upstate Revitalization Initiative would give us that extra boost we need to be like a phoenix and rise again. When I go and visit places like Pittsburgh and Cleveland, the way they have been able to turn their cities around, it’s because of that investment in municipal infrastructure. This competition would give us the ability to do that.”
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he remaining regions competing for the half-billiondollar awards have missed out on high-profile economic development projects in recent years. The Southern Tier was dealt several recent blows, most notably the state’s decision to ban high-volume hydraulic fracturing after years of study. The Southern Tier sits atop the Marcellus Shale, a gas-rich deposit long coveted by the energy industry. But the area’s REDC co-chair Harvey Stenger said the state’s hydrofracking ban should not give the Southern Tier a leg up to win one of the awards. “I’m sure that every region has some excuse of why they’re not doing well and they probably put that
forward in their proposals,” said Stenger, the president of Binghamton University, SUNY. “We didn’t dwell on excuses. We talked about our strengths, our history, about the things that we have that are really good.” The Southern Tier’s plan focuses on advanced manufacturing, revitalizing urban centers – such as Binghamton, Johnson City and Endicott – and expanding agriculture and food production, processing and distribution across the region. “If there was not a competition with the kinds of finances available at stake, we wouldn’t have come anywhere near as good of a plan,” Stenger said. “I think the stakes are appropriate, and even if you don’t win you’re going to take home a lot of good information that you’ve developed in your plan as well as some funding.” Central New York’s plan aims to invest in unmanned systems, with an initial focus on testing, developing and manufacturing unmanned aerial systems. Echoing several regions’ calls for an investment in agriculture, the Central New York plan would also create a “Grown in NY” certification and global brand for state products. The proposal also envisions the construction of an aseptic food packaging facility to extend the shelf life of food products grown in the state. Central New York REDC co-chair Robert Simpson, president and CEO of CenterState, touted his bid’s “datacentric market analysis” and input from the Brookings Institution and other outside analysts. “Competition brings out our best ideas, our region’s strengths of collaboration and innovation,” Simpson said in a statement, “and this plan is a direct and compelling response to the unambiguous challenge given to the regions competing in the Upstate Revitalization Initiative.” The Mid-Hudson region built its proposal around its popularity with tourists and its proximity to New York City. Its plan calls for downtown revitalization at many river, hilltop and crossroads urban centers and investment in Stewart International Airport to promote tourism. The plan also proposes making the Culinary Institute of America a tourist destination similar to Napa Valley. The North Country’s plan also emphasizes tourism, building off Lake Placid’s Olympic heritage with a proposal to be the only location in the world to host a third Winter Olympic Games, which could then attract other international sporting events. cit yandstateny.com
Additionally, a proposed Laurentian Aerospace project would be the first in the U.S. to utilize an automated docking system for the maintenance of wide-bodied aircraft. North Country REDC co-chair Anthony Collins, the president of Clarkson University, argued $500 million would go further in his region. “Economic data reflects that our region is one of the poorest, it’s got a sparse population, it’s seen a downturn and loss of manufacturing jobs in the last decade,” he said. “This could really ignite a significant step forward. This kind of investment in any other region is almost lost in comparison when you think of the regional domestic product – the numbers that are involved in most regions so far exceed even the half-billion dollars. In our region, that amount of money is absolutely significant.”
A
s the Upstate Hunger Games deadline approached, the criticism from local and state officials evaporated. Most of the upstate city mayors involved in a bid declined to discuss the process or details of their bids before the deadline. The REDC co-chairs and upstate mayors who did speak with City & State invariably touted the process and the spirit of competition.
“It is hard to know what to say when you don’t know what the rules of the game are or you don’t know what the favored outcome is,” former Assemblyman Richard Brodsky said. “This is the public expression of the limitations of requiring upstate communities to compete against each other.” Regions during this process spent money on high-powered consultants, developers and construction companies – a process that has now come under scrutiny by U.S. Attorney Preet Bharara, who is reportedly investigating the bidding process for multimillion-dollar contracts awarded through the Buffalo Billion. “(Cuomo’s) model for this is Buffalo, where he’s already declared victory even though it’s just started. It leads to snazzy press releases and, ultimately, new buildings, but the question is whether it produces any sustained or sustainable economic activity,” the Empire Center’s McMahon said. “Success is measured by the press coverage of the announcement. The process itself is considered a success, because politically it is ‘doing something.’ The upstate economy has seen some problems, the planted demand is ‘don’t just sit there, do something.’ This is ‘something,’ and therefore it’s ‘terrific.’”
Senator Jeff Klein
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Commissioner Loree Sutton, Mayor’s Office of Veteran’s Affairs
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For advertising information, please contact Andrew Holt at 212.894.5422 or AHolt@CityandStateNY.com cit yandstateny.com
city & state — October 12, 2015
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RACING & GAMING
RACING, GAMING AND WAGERING 18 For thousands of years, humans have been gambling. Betting on races, throwing dice, even card games like poker – all have been around since before the time of the ancient Greeks. There is even evidence that Native Americans used a cave in Utah as a casino of sorts around the 13th century. The point is, people are going to gamble. No matter what restrictions exist, humans are going to find ways to experience the exhilaration of chance. And in turn, governments are going to continue to play with how best to handle this part of human nature through various forms of regulation. New York has a long history of such give and take. In the early 1800s, the state banned lotteries, but allowed casinos to operate unscathed. In the 1900s casinos went by the wayside and lotteries slowly came back into favor. Eventually Native American-run casinos moved into the state and lawmakers signed off on video slot machines at a few select locations. And through it all, horse racing has been a constant, with varying degrees of state influence. This relationship continues to evolve in New York. The anticipated greenlighting of three resort casinos has started to change the gambling landscape yet again. So has the continued proliferation of video slot machines with the opening of Resorts World Casino at Aqueduct Racetrack in Queens, which generates the most slot revenue in the country. And there are other issues on the horizon that could continue to shape the gambling landscape, from the future of online gambling to the leadership of NYRA. In this spotlight section we shine a light on those topics and check in on the development of the three casinos the state’s siting commission recommended last year.
city & state — October 12, 2015
CONTENTS: 20...
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Winning casino bidders prepare for final green light from state By Wilder Fleming
Lawmakers call on state to make Racing Association board private again By Michael Gareth Johnson
Online gambling in New York is still a work in progress By Jeremy Unger
cit yandstateny.com
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PROVIDING RESPONSIBLE ENTERTAINMENT RWNYC launched the first in-house responsible gaming center, which is now a model for the industry.
SUPPORTING NEW YORK’S RACING INDUSTRY RWNYC’s operations contributed approximately $500 million since opening.
110-00 Rockaway Blvd. Jamaica, NY 11420 rwnewyork.com • 1-888-888-8801 In Queens, near JFK Airport.
RACING & GAMING
ALL IN
WINNING CASINO BIDDERS PREPARE FOR FINAL GREEN LIGHT FROM STATE By WILDER FLEMING
Back in December, a state-appointed board recommended granting casino licenses to three companies in upstate New York. But while that decision marked the end of a long, expensive and uncertain journey for the 16 bidders involved, it was in a way just the beginning for the three chosen projects, which are still waiting on the state to hand down the final licensing document. “We’re on track to issue the gaming licenses before the end of the year,” said Lee Park, a spokesman for the state Gaming Commission. “To keep it in context, it’s been about a year, and we’re moving at veritable light speed compared to other states (like Massachusetts or Pennsylvania).” While the new rules went into effect Sept. 30, Park says this was “only one piece of the puzzle”: The commission has also been working to incorporate updates to the applications submitted by the three companies, while the state police have been conducting thorough background investigations – both of which need to be completed before a final licensing document can be drafted and handed down. From the time the final licenses are issued, the casinos will legally have 24 months to complete construction and open their doors. Here’s a brief update on where each one stands, along with the status of a possible fourth casino that could still be chosen for the Southern Tier.
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1
LAGO RESORT & CASINO
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RIVERS CASINO & RESORT AT MOHAWK HARBOR
Investment: $300 million
The prospective Lago Resort & Casino in the town of Tyre in the Finger Lakes region began weathering a legal challenge in July, when a state appeals court voided an environmental review that had been approved by the Town Board during the initial 2014 application process, saying the town had not adequately elaborated on its “negative declaration” stating that the project would not harm the environment. After Tyre repeated the review process, it reached the same conclusion on Oct. 1, and the casino’s developers say they are now confident they will be able to move ahead with construction once the licenses are handed down, in spite of expected further legal challenges from citizens, environmentalists and other regional casino interests.
The Rivers Casino in Schenectady is part of a larger development project dubbed Mohawk Harbor, which includes both residential and commercial zoning. So while actual construction on the casino portion of the project will wait until the final gaming license is handed down by the state, groundwork for the project as a whole – including the excavation of a canal and elevation of the ground in the face of flooding – is already underway. A spokesman for Rivers says they are ready to begin breaking ground once the casino licenses are finalized, and are confident they will be up and running within the required 24-month period.
city & state — October 12, 2015
Investment: $425 million
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RACING & GAMING 1 2
4
3
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MONTREIGN RESORT CASINO
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TIOGA DOWNS CASINO BID
Investment: $195 million
Like Rivers, the Montreign casino is part of a larger development project. Located in Sullivan County in the Catskills, Empire Resorts has planned a multipurpose resort called Adelaar, which will feature a golf course, water park and other outdoor, family-friendly entertainment detached from the casino. Construction on entry roads and sewer infrastructure for the resort has already begun, and local attitude toward the project has been enthusiastic.
When the casino siting board didn’t grant a license in the Southern Tier in December, local advocates and politicians were furious. Not only had the administration recently banned fracking in the region, but state resources for economic development have by and large been expended in other downtrodden regions of the state, like Western New York. In the face of backlash, Cuomo requested that the siting board reconsider a casino in the region. To date, only one application has been submitted – New York real estate developer Jeff Gural is bidding to expand his harness racing track at Tioga Downs into a fully fledged casino. Lee Park, spokesman for the state Gaming Commission, says a decision on Gural’s application should be handed down sometime “in the next couple months.”
CITY & STATE — October 12, 2015
Investment: $1.3 billion
CIT YANDSTATENY.COM
RACING & GAMING
Q&A S
JOHN BONACIC Chairman, State Senate Racing, Gaming and Wagering Committee
city & state — October 12, 2015
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City & State: After New York legalized commercial casinos, a siting committee recommended that licenses be awarded to three proposed developments in the state. It’s out of your hands now, but how is that process going? John Bonacic: The driving force for me in backing the referendum was to try to have Montreign, which is located in Sullivan County. They’ve been waiting for commercialized gaming for over 40 years. I felt like Moses. I was pleased to see that happen. The governor had indicated that he wanted this to happen quickly, and now it’s almost a year later that we’re still waiting for the licenses to be issued. I would have hoped that the process could have been expedited a little faster. But having said that, with minimum sophistication of the vetting process for applicants, and it is quite complex for all three – the Lago up in Tyre, the Rivers in Schenectady, and Montreign in the town of Thompson in Sullivan County – we’re close. So I’ll be happy when those licenses are issued. My premise for marketing it strongly was let’s help the people that need it the most. As you know, there’s a fourth in play for Tioga, with Jeff Gural, and they certainly need a shot in the arm for economic vitality. But I myself have never reached into the Gaming Commission and interfered with any of their process or their timeline. All we did was confirm the members of the Gaming Commission, so we want to make sure that they get it right.
C&S: Did it surprise you that the state reopened bidding for a casino in the Southern Tier? JB: It did. I assume they are an independent board and were going to call the shots as they see them. But when the governor jumped in and he basically gave them a directive to say, hey, take a look at Tioga, in a way implying that this is something that should happen, I was a little surprised. I’m not saying that it shouldn’t happen, but there is the other side of the coin that says maybe you wanted to keep that one in your pocket because that would’ve allowed four casinos to go in the metropolitan area and Westchester where revenue could be greater. But I have no quarrel either way because I said the goal was to help upstate economic vitality that needed it the most, and when the decision was made, the state made their decisions, I always said based on their heart and not on greed, that was a good thing. That was something I was promoting for creation of jobs and revenue for upstate. So we’ll see what happens. I think from some of the comments of Kevin Law and the Gaming Commission, it looks promising that they will give it to Tioga. Jeff Gural knows the gaming business. He’s a worthy developer, and he’ll do it right. C&S: The Lago casino has faced legal hurdles. Does that cast doubt on the selection process? JB: There was criticism that perhaps the awarding of that site was not a good choice, that 50 percent of their market will take away from existing casinos and racinos. So there were, on its face, legitimate objections. And the environmental review that the town board did was thrown out and they’re quickly trying to get an acceptable environmental review process done before the end of the year. And the Gaming Commission has indicated that that license will issue if the environmental report is satisfactory. But then Wilmorite, the developer, will have to proceed at his own risk because there’s pending litigation, and you always get nervous as an investor when there’s pending litigation.
GARY PRETLOW Chairman, Assembly Racing and Wagering Committee City & State: Where are we at in terms of the approval process for commercial casinos in the state? Gary Pretlow: Right now the Gaming Commission has designated three of the four approved licenses, and there is another one in Tioga that we did a re-bid on, and that’s still in the process of being approved or not. As of this date, no licenses have been issued, but they’re still going through the vetting process and the people who won the award, or were awarded the right to open a casino, have already started construction in some cases, and have already started hiring people and training people and putting them through casino school and dealers school or whatever. So it’s going to happen, it’s just a slow process and the state wants to make triply sure that everything is on the up and up and clean and everyone associated with the casinos when they open have no smudges on their record. This is a big step for New York. We fought gambling forever, and finally we got it in because Gov. Cuomo to his credit agreed with us. C&S: The Lago casino has run into some legal challenges. GP: I didn’t personally like that project, because for one I think it violated the compact we had with the Oneidas. There was a little sliver of available area that wasn’t in the Oneida area, so technically it doesn’t violate it, but it is right next to the Oneida Native American compact area. Secondly, what really is hurtful, and most
people don’t know this, but we get a lot of money for racing from Batavia and from Buffalo, and what’s going to happen is if people are drained off from that track and from the OTBs up there that are doing the betting, which supplies the money to the purses – I mean, Finger Lakes is where the horses that don’t really run in NYRA tracks anymore, they go to Finger Lakes, but that’s also the heart of our winter racing. If we lose the purse money that the VLTs are giving now to the purses at Finger Lakes, there’ll be no winter racing in New York. That will be devastating for the entire industry. So I’m looking very closely at that and trying to do something legislatively where that casino, if it does happen, would actually have to put money into the purses at the Finger Lakes track because we need the racing there. C&S: In the Southern Tier, the state reopened bidding for a fourth commercial license, and the Tioga Downs racetrack again submitted a proposal for a full-fledged casino. Were you surprised by how that played out? GP: Yes, I was surprised by how it turned out. Mr. Gural, who owns that track, was a staunch supporter of passing the constitutional amendment for casino gaming. He does have the location that almost everyone thought would be the Finger Lakes area. For the Gaming Commission to give it to Lago, which is all the way up by Rochester, nowhere near the Finger Lakes, was a miscarriage of the intent of what we’re trying to do. We’re trying to spread it around the state. We now have a concentration of casinos in that area. We have Turning Stone that has been operating, and Ray Halbritter, who runs Turning Stone, is opening a casino that is very close to where Lago is going to be. It’s just going to be a bad situation for all parties concerned.
To view the complete interviews with Bonacic and Pretlow, visit cityandstateny.com.
cit yandstateny.com
ROBERT WILLIAMS Executive Director, New York State Gaming Commission City & State: The Gaming Commission has yet to officially award licenses for the three casino projects recommended by the siting board. What’s the timeline for that? Robert Williams: We remain on track to issue licenses by the end of the calendar year. We have been moving expediently with staff completing suitability reports of each project and their principal management staff, as well as reviewing the appropriateness of all post-selection application or design changes.
C&S: What kind of opportunities does the state’s casino expansion offer for minority- and womenowned businesses? RW: There are abundant opportunities for MWBEs, from design and construction contracts to opportunities as gaming and non-gaming suppliers. This is a unique opportunity: more than $2 billion in development taking place across upstate New York. One of the key parts of this entire process has been the recognition of the importance of MWBEs in the development of these destination resort casinos. The Gaming
Facility Location Board recommended that the commission require the governor’s 30 percent MWBE participation goal. We did, passing rules that explicitly require as much. At the Oct. 1 MWBE conference in Albany, we outlined the process for hundreds of MWBE organizations in the room on how to get involved with the casino developers and the intricacies of working in the regulated gaming industry. We are also planning licensing seminars in the three regions where the casinos are to be located, in the hopes that we can streamline the process for businesses wishing to work on these projects. C&S: Mark Gearan recently stepped down as chairman of the state Gaming Commission. One of his top priorities was addressing problem gambling. What kind of progress was made on that front during Gearan’s tenure? RW: We’ve made substantial progress and we continue to do more. Mark really was at the forefront of doing something that never before existed in New York: bringing gaming operators into the room with problem gambling
treatment providers and literally having a conversation and working together. Mark recognized that the gaming landscape in the state was changing and noted that it is simply good policy. We readily acknowledge that problem gambling is a real issue and one that the state needs to address as a form of effective regulation. Right now, with our partners in the Responsible Play Partnership (the New York Council on Problem Gambling and the New York Office of Alcohol and Substance Abuse Services), we’re working on a series of projects: a statewide self-exclusion policy, a study on the prevalence of underage lottery sales, responsible gambling publicservice announcements and additional regional meetings with gaming operators and treatment providers. Additionally, the National Council on Problem Gambling is holding its national annual conference in New York next year and the commission is looking forward to assisting with the event. We are open to do more to drive attention to the issue and to ensure those that need help are aware of and have access to the various programs offered throughout the state.
RACING & GAMING
C&S: In a second round of bidding for a fourth casino, to be located in the Southern Tier, only one bid has come in, from the existing racetrack casino Tioga Downs. What is the timeline for this selection process? RW: The Gaming Facility Location Board indicated that they intend to make a decision this fall. Last week, the board met with its consultants to discuss the financial components of the Tioga Downs application. The board has scheduled another meeting for Oct. 14.
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city & state — October 12, 2015
Town of Nichols - $2,231,966
RACING & GAMING
SWITCHING LEADS LAWMAKERS CALL ON STATE TO RETURN NYRA TO PRIVATE CONTROL By MICHAEL GARETH JOHNSON
city & state — October 12, 2015
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heading into the final stretch of a race, part of a jockey’s job is to urge the animal to switch its “lead.” A horse usually kicks its left front leg out first as it arcs left around a turn, because it is more efficient. But if it continues to run with its left leg as the lead, it will get tired in the straightaway, so a good jockey will flip his or her wrist or give the horse a light tap with the whip to make it switch to lead with the right foot. Switching at the right spot is key. If you switch too late, the horse loses speed as it tires on the left lead. If you switch too early, it may tire on the right lead before the finish line. This is an apt metaphor for the position the New York Racing Association now finds itself in. After three years of state control of NYRA’s board of directors, pressure is mounting to return control of the franchise to people with more experience in the industry. “I think it is time for a change,” said John Bonacic, chairman of the state Senate’s Racing, Gaming and Wagering Committee. “Sometimes it is healthy to have change. And there are many people smarter than I who want the existing board removed or replaced, but in the last 12 months they have done a good job in making sure it is back in the black.” Gary Pretlow, the Assembly’s Racing and Wagering Committee chairman, agreed. “The people who are now on the board, they all have good intentions, but none of them are racing people,” he said. “Yes, you can hire people to do that job, but I really don’t think the industry should be controlled by people whose interests are not in horse racing.” The argument for this change is that NYRA’s caretakers are businesspeople who have been effective in the short term at balancing the books after a
time of controversy and corruption, but are not best suited to outline a long-term vision for how the state’s three biggest race tracks should be operated. This was outlined in a letter signed by Bonacic and Pretlow along with Capital Region lawmakers who expressed concerns about the future of the Saratoga Race Course, which they called a “crown jewel of racing” and is one of the top summer vacation spots in upstate New York. For lawmakers and concerned residents, a change now could capitalize on the stabilizing impact the state takeover had, and give horse racing a well-timed boost – much like a horse switching leads at just the right moment in the home stretch. But there is little to suggest NYRA will go through large-scale changes anytime soon. THE TAKEOVER After tumultuous years in the ’90s and early 2000s filled with accusations of mismanagement and corruption culminating in a federal indictment for tax evasion and money laundering and a bankruptcy filing in 2006, NYRA was nevertheless awarded a franchise license in February 2008 to operate the state’s three biggest tracks – Belmont, Aqueduct and Saratoga. One key factor in the forging of the 25-year deal was a legal dispute between the state and NYRA over who owned the racetrack properties, worth billions. In exchange for extending NYRA’s franchise rights through 2033, the association dropped its claim to the properties. NYRA is a nonprofit entity that has specific rules dictating how it can operate the betting at the tracks. Each race has a pot of money from a host of different types of bets – from just betting on the winner to betting on the order in which the horses will finish, known as exotic bets. That money is cit yandstateny.com
SPORTLIBRARY
As a horse runs around the turn
THE FUTURE Part of the reason the takeover was extended in last year’s budget was because the board had not put forth a transition plan for moving the association back into majority private control. NYRA is required to put forth a plan 180 days before the end of the
and the governor’s office. But this is an important issue to several incumbent lawmakers in the Capital Region, so simply extending state control probably won’t be a viable option, either. Both Bonacic and Pretlow said they would like to see lawmakers pass legislation calling for only small changes to NYRA’s leadership, removing state control and replacing it with a more private model. “I am a believer that the private sector can always do anything better than government,” Bonacic said. “So I don’t want government running NYRA. I would rather have smart, sophisticated people knowledgeable in the horse racing industry and having fiscal intelligence and a sense of economic vitality to keep a business going and thriving.” “It should run well and be managed well, but we are not in the business of running racetracks,” Pretlow said. “That is not in our constitution to do. But we do issue licenses for people to do things and make money in New York and pay their taxes. What we are really interested in is getting a return from the entity. And if it were put into the hands of racing people, that will happen.” In horse racing parlance, favorites in a race are referred to as “the chalk.” Right now, the chalk on the future of NYRA is a plan with a modest move
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divided into specific payouts based on a formula. NYRA takes a cut, but money also goes to several other areas, including the state and the breeders of the horses. In spring 2012, it was discovered that NYRA had not paid out enough for certain exotic bets for 15 months in 2010 and 2011 and had never revealed the mistake to the state oversight board. In total, the association kept more than $8 million it should have paid to bettors. The revelation led to a shakeup of the NYRA board. Gov. Andrew Cuomo quickly moved to restructure the entity, creating a 16-member board, with seven appointees made by Cuomo and two appointees each by the Assembly and Senate. The remaining five appointees came from the old NYRA board. When the state initiated the takeover, it was to be in effect for three years, expiring at the end of this month. But in this year’s budget, state control of NYRA was extended another year, making the end of October 2016 the target date for a return to private control.
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“The people who are now on the board, they all have good intentions, but none of them are racing people.” - Assemblyman Gary Pretlow
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city & state — October 12, 2015
takeover, which is now roughly April 2016. If the report comes out on time, it sets up an intriguing timeline. The state budget is due April 1. Assuming the plan isn’t released before the budget, and therefore not included in the budget, then the state Legislature will have to take action before the end of the session in June. Since 2016 is an election year, controversial legislation can often be hindered because of disputes, making any large-scale change to NYRA unlikely unless there is overwhelming consensus in the Assembly, Senate
RACING & GAMING
A CLICK AWAY
ONLINE GAMBLING IN NEW YORK IS STILL A WORK IN PROGRESS By JEREMY UNGER
The business of gambling, while
city & state — October 12, 2015
26
more often associated with Atlantic City than the Empire State, is seeing a massive expansion in New York. An amendment to the state constitution in 2013 allowed casino gambling outside Indian reservations and expanded horse tracks into full-fledged commercial institutions. But another realm of the industry is lagging behind: online gambling. Since 2011, when the U.S. Justice Department issued an opinion stating that the federal Wire Act, which bans certain types of gambling, actually permits states to legalize it online, New Jersey, Delaware and Nevada have set up their own online gambling systems through casino-run websites. But in New York, online gaming, as its supporters call it, is still a work in progress. Currently, the only legal gambling New Yorkers can do online is through purchased subscriptions to certain state lotteries. But state Sen. John Bonacic introduced a measure last year that seeks to legalize Internet versions of Texas Hold ’em and Omaha Hold ’em poker. The bill, which has companion legislation introduced by Assemblyman Gary Pretlow, is still in committee and wouldn’t allow any games of chance, such as blackjack and roulette, like New Jersey does. But as one of the big supporters of the new casinos going up across the state, Bonacic sees online gambling as a necessary factor in the equation, especially with young people. “If we are going to be in gaming as a revenue enhancer for the state … I believe that what you are going to see is that the (millennial generation) doesn’t care to visit as much mortar and brick as the older generation,” Bonacic said. “So if you’re in the gaming business
and you’re going to invest substantial private dollars, you’ve got to attract the (millennials).” It would appear, however, that New Yorkers of all generations seem open to the idea of gambling from their computers. An April 2014 poll from Global Strategy Group, commissioned by casino developers Caesars and MGM, found 75 percent of voters thought individual states should be able to decide whether to allow online poker. But that support doesn’t seem to be translating to the Legislature, where a hearing on the issue was sparsely attended by members of the state Senate Committee on Racing, Gaming and Wagering. At the hearing on Sept. 9, one of the main concerns brought up by the three senators in attendance was whether online poker would
actually help or hurt casinos. An H2 Gambling Capital analysis determined that as much as $110 million in revenue is generated through illegal online poker games in New York and that a legalized system could generate $50 million to $80 million in annual taxes. But most revenue might not go to the brick-and-mortar casinos themselves. “The online gaming customer is a different customer than the landbased customer,” Tom Balance, president of Borgata Hotel Casino & Spa in Atlantic City, testified at the hearing. “We find that the online customer ... they’re playing for 15 minutes, 20 minutes at a time. In order to make the commitment to come to a land-based casino, you’ve got to get up, get dressed, shower, drive there, you’ve got to make a big commitment,
so you’re going to be there for a long time. The online customer is more of a nibbler.” In New Jersey, which initially predicted that online gambling would raise $150 million in taxes in its first year, revenues actually averaged around $10 million a month, with only 18 percent of total revenue coming from online poker. But while casinos in the Atlantic City area have been struggling to bring in customers, Bonacic and Pretlow both argue that online users are not hurting brick-and-mortar casinos. “What I’ve found in talking to the professionals from Jersey, from Vegas … it’s that they do (online gaming) to attract people to come into the actual casinos, but they gain revenue also from online gaming,” Bonacic said. “One doesn’t hurt the other.” All of this could be moot, however, if online gambling opponents have their way at the national level. Sheldon Adelson, the billionaire political megadonor and chairman of Las Vegas Sands Corp., is pushing for Congress to pass the the Restoration of America’s Wire Act, which would ban regulated online gambling. The bill, sponsored in the Senate in 2014 by Republican presidential candidate Sen. Lindsey Graham, is currently stalled in committee, but supporters of the bill have considered changing it to place a moratorium on future online gambling projects instead of an acrossthe-board ban, which could make it more viable in 2016. Either way, the issue of online gambling has taken a back seat in New York as lawmakers focus on setting up the new casinos. “(Online gambling) won’t happen this year,” Pretlow said. “I’ve been very public in stating that it won’t be approved in New York until at least all the casinos are up and running, and they have to be a part of it and the racinos have to be a part of it.” cit yandstateny.com
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ON DIVERSITY
ARMAN DZIDZOVIC
28
city & state — October 12, 2015
New York is one of the country’s most diverse places, with residents from all over the country and around the globe. The state is also in many ways at the forefront of efforts to increase diversity, both in the public and private sectors, from the classroom to the boardroom. At City & State’s annual On Diversity conference last month, top officials and experts discussed the importance of a diverse workforce and the ways that government can expand opportunities for businesses owned by women and minorities, or MWBEs. The event was sponsored by HAKS, the Building Trades Employers’ Association, Bradford Construction, WDF Inc., the MTA, the New York City School Construction Authority, the City Department of Small Business Services and the New York Women’s Chamber of Commerce and was hosted by BNY Mellon. In the following pages, we recap the highlights from the event’s panel discussions and the keynote address by Maya Wiley, counsel to New York City Mayor Bill de Blasio and the administration’s point person on increasing city contracting with MWBEs.
CONTENTS:
30... The practical reasons we need diversity in the workforce By Jeremy Unger
32... City officials blame state law for MWBE contracting record By Jon Lentz
34... Diverse views: What the experts had to say
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29 Founded in 1991 and incorporated in 1994, HAKS has grown into a full-service consulting firm providing construction management/inspection, engineering, architecture/facility design, environmental consulting, land surveying, material testing and special inspection services. Our diverse workforce of 640 people embodies enthusiasm, a can-do attitude, as well as an entrepreneurial spirit that allows us to create our own opportunities while treating people with respect and trusting in all we do. These values are the threads woven throughout our firm’s history and legacy that continue today. As we celeberate our 25th year, our goal is to improve the communities in which we live and work while enhancing social, economic and environmental conditions. We have earned our reputation for excellence with every task we undertake and every assignment we complete. Our ability to understand and anticipate project requirements and proactively respond to them is a testament of our commitment to our ever increasing client base.
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CITY & STATE — June 15, 2015
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ON DIVERSITY
DOWN-TO-EARTH DIVERSITY WHY WE NEED A RANGE OF VOICES IN THE WORKFORCE
city & state — — October 12, 2015
30
New York is at the forefront of the movement to diversify the workplace. But while the benefits of greater diversity have been widely recognized, actually getting there is another challenge entirely. New York City Mayor Bill de Blasio has been accused of underrepresenting Latinos in his administration. City Council Speaker Melissa MarkViverito has raised concerns about the declining number of women on the City Council. And Gov. Andrew Cuomo has faced criticism for hiring relatively few women to top positions. Yet officials say they are taking steps to boost diversity, in both the public sector and the private sector. Maya Wiley, the counsel to the mayor who oversees the city’s MWBE initiative, said that the de Blasio administration has a senior leadership team that is 60 percent female and 37 percent people of color. “That shouldn’t be historic, but unfortunately it is,” Wiley said during keynote remarks at City & State’s On Diversity conference. “And it’s not enough.” Carra Wallace, chief diversity
ARMAN DZIDZOVIC
By JEREMY UNGER
Teach for America’s Charissa Fernandez, DCAS’ R. Fenimore Fisher and the comptroller’s office’s Carra Wallace speak at the forum.
officer for city Comptroller Scott Stringer, said during a panel discussion at the conference that her boss “doesn’t just talk the talk, he walks the walk.” Beyond increasing the number of women and minorities in Stringer’s office, Wallace said their team is using
Maya Wiley, counsel to the mayor, highlighted the administration’s diversity record.
the power of the city’s pension funds to sway large private companies to diversify and create better work-life balances for both men and women, especially at the executive level. “Less than 5 percent (of women and minorities) make it to the top … so we’re saying look, if we own 3 percent of a company for three years, then we should have the ability to nominate 25 percent of the boards of directors,” Wallace said. “(So far) we’ve seen votes go in our favor close to 75 percent of the time. It’s really starting to make headway and people are starting to get it that you need the independence of board directors, you need diversity.” The future of diversity in big business, however, largely rests on what the next generation of leaders does. According to Charissa Fernandez, executive director of Teach For America, the biggest challenge may be including young men of color. “We have actually struggled to bring men into the teaching force, and particularly men of color,” Fernandez
said. “In our schools we need to ensure that what we’re doing is both providing role models for students … as well as giving them the opportunity to engage with people from different backgrounds than their own.” After recent U.S. Supreme Court decisions dealt blows to pathways that have traditionally been used to promote diversity, like affirmative action, some are turning to more pragmatic solutions. R. Fenimore Fisher, chief diversity and equal employment opportunity officer for New York City’s Department of Citywide Administrative Services, said diverse workplaces allow for a wider range of viewpoints and, in the end, better decision-making. “Doing the same thing over and over again with the exact same people and expecting better results is the definition of insanity,” Fisher said. “The business and moral argument for inclusion and diversity are clear and evident.” cit yandstateny.com
ON DIVERSITY
A TREND WORTH IMITATING
perspective.” Wiley went on to talk about how it is important to get people from different perspectives into a room to talk about an issue. “The thing that is most powerful about the diversity statement itself is its definition of diversity,” Wiley said. “Because its definition is that there is enough critical mass across groups that not one person has to be a monolithic voice for an entire community. You can’t be diverse because you have one woman who is white, or one Latino who is male, because that means you are asking someone to represent a community that is monolithic.”
BUZZFEED’S WORKING DEFINITION OF DIVERSITY “Enough people of a particular group that no one person has to represent the supposed viewpoint of their group – whether ethnicity, gender, sexual orientation, religion, gender identity, socioeconomic background, or disability. And if the group is a small one we should never expect one person to be the ‘diverse’ reporter or writer, or to speak for anyone other than themselves.”
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1. Government Certification and
Pre-Qualification of M/WBE firms
2. Establish a Capital Construction Bank
31
to provide lines of credit
3. Compete for School Construction Authority, NYS Dormitory Authority, and NYC Project Labor Agreement projects for an estimated $20 billion
4. BTEA to establish a “PLA Technical
Assistance Program” to help in understanding PLA terms & conditions for M/WBE Contractors awarded NYC and NYS contracts under Project Labor Agreements
5. Create mentor programs that will meet
city, state and federal law enforcement standards
www.bteany.com Louis J. Coletti Representing over 2000 union construction managers, general President & CEO contractors and specialty subcontractors in New York City.
CITY & STATE — October 12, 2015
In her keynote address at City & State’s On Diversity forum, Maya Wiley, counsel to New York City Mayor Bill de Blasio, said the best diversity statement she could find anywhere – from city government, state government or the private sector – came from Buzzfeed Editorin-Chief Ben Smith. “What the diversity statement starts with is, one, it is just morally right to be inclusive,” Wiley said. “But secondly, he goes into a description about how it is important to, for a business entity but also for a news entity, you can’t possibly identify and represent the news adequately if it only comes from one
BLUEPRINT FOR M/WBE GROWTH
ON DIVERSITY
HAMPERED EFFORTS
CITY OFFICIALS BLAME STATE LAW FOR WEAK MWBE CONTRACTING RECORD In the effort to award more government contracts to businesses owned by minorities and women, New York City has long been outpaced by the state. The explanations offered for this are wide-ranging: from Gov. Andrew Cuomo’s remarkable success in prioritizing such firms at the state level to lackluster efforts by Mayor Bill de Blasio’s predecessors, to the lack of a single point person in the city on minority- and women-owned business enterprises (commonly known as MWBEs). But city officials emphasize that they are also hampered by statutory restrictions – including some that can
Assemblyman Michael Blake, Bradford Construction’s Sandra Wilkin, BTEA’s Lou Coletti, The Black Institute’s Bertha Lewis and Assemblywoman Rodneyse Bichotte offer views during a panel discussion.
only be changed through state legislation. “There are so many barriers in the way that are legal barriers, just straightup laws, that get in the way of the most committed agency’s desire to do business with MWBEs,” said Maya Wiley, a top de Blasio adviser who oversees the city’s MWBE initiative, during City & State’s annual On Diversity conference. “The truth is the state has more tools than we do, and we are precluded by state law – precluded by state law – from doing some of the same things the state does to get those numbers up.” One measure introduced in Albany this past session aimed at putting the
32
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ARMAN DZIDZOVIC
By JON LENTZ
“We’re actually creating jobs in communities of color that are often ignored. We are actually promoting diversity inclusion reflecting the face of the city of New York, so that is value in and of itself.” Assemblyman Michael Blake urged Cuomo to sign a bill that was actually approved by both houses and could benefit MWBEs. The legislation would require state agencies to pay small contractors within 15 days, down from 30 days. Other panelists, including representatives of the New York City School Construction Authority, the Metropolitan Transportation Authority and the Dormitory Authority of the State of New York, touted programs that provide mentorship for smaller MWBEs. But despite the programs’ successes in creating jobs and expanding the pool of contractors, they cannot be replicated at every agency or in the city due to additional restrictions in state law. Bichotte said she wants to change state law to expand mentorship opportunities as well. “We want to somehow build models that will reflect certain types of mentorship programs,” she said, “so that MWBEs and small businesses will have a better chance of
getting access to contracts.” In New York City, the most recent figures show that only 4 percent of contracts go to MWBEs, compared with 25 percent at the state level. The de Blasio administration has set a specific dollar amount it would like to award to MWBEs, pledging $16 billion for such firms over a decade. Wiley said at the conference that the city had already made substantial progress toward that goal. “We are announcing today that we have awarded $1.6 (billion) of that already,” Wiley said. “That’s 10 percent of our 10-year goal, so we both feel really good about it, and we also know that we have to continue to do better.” But some critics still are unhappy with the city’s performance, despite the challenges it faces. The New York City Comptroller’s Office last year issued a report giving the city a “D” grade, citing a “failure of the City to achieve its M/WBE participation goals.” Bertha Lewis, the president and founder of The Black Institute and an outspoken critic of the de Blasio administration’s performance on MWBEs, went even further, saying that a “D” grade is too generous. “The comptroller cannot issue a
report that says only 4 percent of all city contracts go to MWBEs,” Lewis said during a panel discussion at the conference. “That means 96 percent of all city contracts go to non-MWBEs, mainstream white firms, OK? This city is 65 percent minority, and the city gets a ‘D’ when it’s only giving out 4 percent? The grade should be F-minus!” Experts have also emphasized the importance of a chief diversity officer position tasked with carrying out MWBE goals. The position was created at the state level when David Paterson was governor, but the city has not followed suit. The de Blasio administration has said that Wiley, the counsel to the mayor, provides sufficient oversight of MWBEs. Lewis vehemently disagreed, and said that simply creating the position is not enough. The state’s chief diversity officer, she continued, should also have greater responsibility and more clout to hold agencies and contractors accountable. “There needs to be someone in charge, and there needs to be a point person, there needs to be a central place,” Lewis said. “However, that person has to have the power to reward or to punish.”
ON DIVERSITY
city on a more even playing field would have allowed agencies to bypass the competitive bidding process and make discretionary purchases of up to $200,000 from certified MWBEs, up from caps ranging from $20,000 to $100,000, depending on the contract. The legislation, which would also create a capacity building program, was approved in the Assembly but did not advance in the state Senate. “New York City, which has probably half of the population of the state of New York, are still not up to par in their municipal laws around MWBE,” said Assemblywoman Rodneyse Bichotte, the bill’s sponsor and chairwoman of a subcommittee on MWBEs, during a panel discussion. “So this bill provided a discretionary limit to go from $100,000 to $200,000, which is where the state is at. Why is New York City’s not?” Bichotte added that the state should allow New York City to use a “best value” system with MWBEs instead of simply selecting the lowest bidder, and to expand lists of prequalified MWBEs to expedite the vetting process for agencies and prime contractors. “MWBEs bring value in many different instances,” Bichotte said.
33
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city & state — — October 12, 2015
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ON DIVERSITY
VARIED VIEWS
EXPERTS WEIGH IN ON BOLSTERING DIVERSITY AND MWBES New York has increased its share of government contracts going to minority- and women-owned businesses in recent years, but experts and officials say there’s still plenty of room for improvement.
“We in the Assembly introduced around 50 bills around MWBE and small businesses. We actually passed about 10 of them in the Assembly, and four in the Senate and the Assembly. That’s huge, because normally we pass none. We’re waiting for the governor to sign on to these bills to become law.” –Assemblywoman Rodneyse Bichotte
city & state — October 12, 2015
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“If you want repeat business, if you want to be part of the protocol in a process of excellence, I think we have to be much more collective and broad in terms of how do we think about restructuring the opportunities. Because at the end of the day, this is a very good business initiative.” –Gerrard Bushell, president and CEO, Dormitory Authority of the State of New York
“There is a vast difference between working with corporate America and working with government, and I think MWBEs really need to know and educate themselves on what the roles are in working in the government sector and be prepared.” –Julia Presley, vice president of operations and business development, New York & New Jersey Minority Supplier Development Council
“We need more capacity. We need more qualified people. … We as contractors are not permitted to mentor. We’re not allowed to do that. That’s surprising to a lot of people. So when we use a subcontractor and they don’t perform, it’s our responsibility.” –Larry Roman, president and CEO, WDF Inc.
cit yandstateny.com
ARMAN DZIDZOVIC
34
“When we hear about 50 bills being introduced and only four being passed, I’m sorry, that sucks. … I’m putting it on the black, Latino, Asian, Hispanic caucus. I’m putting it dead on your shoulders, because here’s the dealio. The numbers that the caucus represent could shut this government down and could stop any budget at any time.” –Bertha Lewis, founder and president, The Black Institute
“We are only going to make real progress on the MWBE front if folks can be real that we’re not doing enough and make the tangible changes that need to happen for that to occur. We can continue to talk about access to capital, access to contracting and bonding, all these things. But until you break institutional barriers that are put in place that will not allow for success, nothing else will work.” –Assemblyman Michael Blake
ON DIVERSITY
“We’ve been lucky because we have our own legislation that created the SCA, and we had exemptions that the city doesn’t enjoy. So we have been able to put together a mentor program, we’ve been able to start a bonding program, because legally we can. Whereas the city, even though it would love to be able to do these things, is going to need relief.” –Ross Holden, executive vice president and general counsel, New York City School Construction Authority
“Our annual budget is $5.5 billion a year. When you think about the MTA, you just think about transportation, but we buy legal services, architects and engineers, information technology. We are approving an all-MWBE IT RFP that went out with only four state-certified firms. So we are also the largest buyer of rail cars, subway cars and buses in the country, and we’re focusing on this area. That’s where MWDBE growth is going to be at the MTA.” –Michael Garner, chief diversity officer, Metropolitan Transportation Authority
35 CAN YOUR BUSINESS AFFORD TO MISS OUT ON $16 BILLION IN CITY CONTRACTS? The NYC Department of Small Business Services (SBS) offers a vast array of services to our small business community to make it easier to do business with the City of New York. The City is committed to awarding $16 billion in City contracts to M/WBEs over the next decade. Getting certified as a Minority & Women-Owned Business Enterprise (M/WBE) puts your business in position to compete on government contracts and access exclusive programs designed to help small businesses grow. Take advantage of the following programs: • WORKSHOPS • NYC CONSTRUCTION MENTORSHIP • BOND READINESS • CONTRACT FINANCING • NYC TEAMING • STRATEGIC STEPS FOR GROWTH
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CITY & STATE — October 12, 2015
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SMOKE-FREE FUTURE ADVOCATES TACKLE THE ‘NEXT FRONTIER’ IN FIGHT AGAINST SECONDHAND SMOKE
city & state — October 12, 2015
36
Since New York City banned smoking in bars and restaurants in 2003, there has been a significant decrease in smoking-related illnesses and deaths. Yet despite more and more scientific studies outlining its harmful effects, millions of New Yorkers still live in buildings where smoking is allowed and are being subjected to secondhand smoke on a daily basis. At City & State’s recent event on housing equity, Dr. Mary Travis Bassett, the city’s commissioner of health and mental hygiene, described the push to make apartment buildings and other multifamily dwellings in the five boroughs smoke-free “an important step ... in many ways the next frontier in trying to protect people in the risks of secondhand smoke.” The event was sponsored by NYC Smoke-Free. Elizabeth Kilgore, acting assistant commissioner of chronic disease at the city Department of Health and Mental Hygiene, reinforced that children and the elderly are particularly vulnerable to exposure to smoke. “More ear infections. More asthma attacks. And secondhand smoke exposure has been linked to sudden infant death syndrome,” she said. Kilgore was joined on a panel by City Councilman Donovan Richards; Dr. Warren Friedman, senior adviser to the director at the U.S. Department of Housing and Urban Development; Jeffrey Brodsky, vice chairman of Related Companies; and Patrick Kwan, director of NYC Smoke-Free. The discussion focused on the progress that has been made so far on educating tenants, property managers and developers about the benefits of smoke-free housing. Both HUD and the city Health Department have put
ARMAN DZIDZOVIC
By MICHAEL GARETH JOHNSON
New York City’s health department’s Elizabeth Kilgore speaks during a panel at City & State’s Housing Health Equity Forum.
together toolkits explaining the laws that would allow multifamily buildings to go smoke-free. NYC Smoke-Free also works directly with property managers to keep them informed of how those laws can be implemented. “(We are) helping them with everything from signage to suggestions of strategies,” Kwan said. Informing tenants of their rights is also an important part of the push for smoke-free housing. On the federal level, HUD has had some success by actively engaging residents. “First step is to get the residents
involved,” Friedman said. “Second step is to survey the residents. We have the general percentages of who does what, but getting a survey out engages all of the residents and gets them talking about it, gets them thinking about it.” It is a lot easier to implement smoke-free policies at market-rate apartments and new developments. With the de Blasio administration focused on building more affordable housing, advocates would like to see smoking bans in the new structures. “We need to ensure that as the
city is subsidizing units and buildings across the city that they should be smoke-free,” Richards said. Related Companies, which has decided to make its entire portfolio of residential buildings smoke-free across the country, recently opened a smoke-free affordable housing unit in Hunters Point South. Brodsky said the process was not hard because residents were aware of the criteria before they applied for an apartment. The struggle, Brodsky said, lies in making changes at older buildings, particularly government-subsidized cit yandstateny.com
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and rent-stabilized apartments. “The biggest unresolved concern,” Brodsky said, “is that I am not allowed to initiate a smoke-free program because it changes the terms of a lease in a rent-stabilized apartment.” Friedman agreed that there are many hurdles when it comes to making government-subsidized housing smoke-free, but HUD is working to make it a requirement for all new tenants as well as existing tenants. Enforcement of these regulations can become difficult, Friedman said, if an entire building is not smoke-free and it is unclear where smoke is coming from. Another wrinkle in this process is the protections available to disabled smokers. Under the Fair Housing Act, they may be grandfathered into their apartments and cannot be forced to move. “They have a valid claim,” Friedman said. “So a grandfathering provision may help them if they want to stay in their unit. There is a balancing of rights that they have in the Fair Housing Act with what we are all trying to do in terms of health of people.” The panel also discussed the impact of secondhand smoke on building maintenance workers, which could be
another argument for implementing a policy that prohibits smoking in multifamily dwellings. While Related has been a leader in the field of smoke-free housing since launching a pilot program in 2009, Brodsky hasn’t seen many other developers and property managers following his company’s lead. “I think the development community, regardless of what asset class when it comes to multifamily, whether it is expensive or luxury or whatever, they don’t want to take on what they see as potentially a public relations concern, potentially a litigation concern,” Brodsky said. However, Brodsky suggested that landlords and property managers should be more concerned about providing healthy environments for tenants than respecting individual residents’ rights to smoke. Brodsky said too many companies are “concerned about not being sued by a smoker – which we have not been. We are concerned about being sued by a nonsmoker. Because as a landlord we are obliged to provide a safe and sanitary environment, and that can be extended to quiet enjoyment and that can be interpreted to mean air quality.” cit yandstateny.com
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GRADUATE SCHOOLS SUPPLEMENT City & State magazine presents its Graduate and Continuing Education Series in an effort to inform our readers, the leaders and future leaders of New York, about the many educational opportunities the state has to offer. Whether a government staffer, business executive or nonprofit advocate, graduate and continuing education programs abound to assist you in attaining applicable training and knowledge. The articles featured in this section outline the benefits of continuing education programs as well as what to look out for when applying.
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SHOULD YOU GET AN MBA? By ED BATISTA
At least once a month an ambitious and hardworking person in their 20s asks me, “Should I get an MBA?” I earned my MBA from Stanford’s Graduate School of Business in 2000, and since 2007 I’ve been an instructor and an internal coach back at the GSB, helping hundreds of students develop their leadership and interpersonal skills. Here’s how I respond to those inquiries. First, it’s critical to determine whether your expectations for an MBA are aligned with what the degree will likely do for you. MBA programs offer three different types of benefits, all of which vary tremendously from one school to another. 1. Practical leadership and management skills. Management education has changed significantly
over the last few decades. Previously it focused on quantitative analysis in areas such as finance and operations, with little emphasis on other aspects of organizational life. As a result MBAs were often seen as bean-counters myopically focused on data and out of touch with the challenges managers face in the real world. MBA programs responded by expanding their offerings in areas such as strategy, organizational behavior and leadership. B-school curricula are still intensely quantitative, but as Stanford Dean Garth Saloner told McKinsey, “The [quantitative] skills of finance and supply chain management and accounting and so on, I think those have become more standardized in management education, have become
kind of what you think of as a hygiene factor: Everybody ought to know this.” Business schools have realized that it’s not sufficient to provide quantitative and analytical training, because within a few years of leaving school (or even immediately upon graduation) their alumni will add value more through their ability to lead and manage others than through their talents as individual contributors. And effectiveness in these more senior roles requires an entirely different interpersonal skill set. Saloner goes on to note that, “the softer skill sets, the real leadership, the ability to work with others and through others, to execute, that is still in very scarce supply.” But the ability to provide quality training in these areas is unevenly
distributed across MBA programs. The best schools have made leadership and interpersonal skills a high priority – Stanford now offers 12 sections of Interpersonal Dynamics to more than 400 students each year, making this labor-intensive course our most popular elective. Second-tier schools are making an effort to catch up, but high-caliber programs in these fields are difficult to establish. Harvard’s Bill George has said, “I don’t think you can teach leadership, I think you can learn about it” through experiential activities that bring students together to help them understand their strengths and limitations, provide feedback and promote self-awareness, and these activities require a very different approach from traditional
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chance to prove myself as an individual before being stereotyped. My particular version of this experience may have been unusual, but by no means is it unique – there are many fields and organizations in which MBAs are viewed with skepticism and even disdain. In addition, the nature of the signal being sent depends on the specific MBA program’s reputation, and this is
not simply a matter of prestige. Harvard, Stanford, and Wharton routinely top lists of U.S. business schools, but they also have a reputation for entitlement and arrogance. While some firms seek out graduates from elite schools, others avoid them out of a concern that they will be difficult to work with and disruptive to the established culture. So ask yourself: • What market am I in now? What
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optional degree and is nothing like a JD, an MD or the other credentials that professions such as law and medicine make mandatory. There are many senior people in general management roles, in consulting and even in financial services who don’t have an MBA – so don’t assume that the credential will necessarily serve a meaningful purpose in your chosen field As a coach I have two different “markets” – my students at Stanford and my private clients, who are primarily senior leaders, and in both settings my degree sends a useful signal. New students feel more comfortable knowing that I’ve been in their shoes (albeit 15 years ago), and prospective clients trust that I understand the complexities of their world and the challenges they face. But it’s not a given that an MBA will have this effect. In my first job after business school I interacted with a very diverse range of communities, and while I never misled anyone about the fact that I had an MBA, I didn’t advertise it either. I knew that some people in my field had negative impressions of MBAs, and I needed a
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Urban Policy and Planning at HUnter college A SmArt ChoiCe With 66% of the world’s population expected to be living in cities by 2050, there is no better time than now to study urban policy, leadership and planning. And no better place to do it than at Hunter College, located in the heart of New York, the most dynamic city in the world. The hunter College Department of Urban Policy and Planning offers an MS degree in Urban Policy and leadership, an MUP in Urban Planning, and an undergraduate major in Urban Studies. The department’s distinguished faculty are affiliated with the Roosevelt House Public Policy Institute at Hunter, one of New York City’s premier venues for public affairs discourse and debate. http://www.hunteruap.org
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CITY & STATE — October 12, 2015
MARCELO RODRIGUEZ
lecture methods. I’m not suggesting that the quantitative and technical skills that an MBA provides aren’t useful – they absolutely are. But they’re also increasingly available through other venues that individuals can access on their own at a much lower cost. The special advantage of an MBA program is the opportunity to develop leadership and interpersonal skills with a group of peers in a sequence of experiential courses informed by current research. So ask yourself: • Do the MBA programs I’m considering provide practical leadership and management training? • How well-established are these courses? How much support do they have from the school? How much support do they have from the surrounding community? • What do alumni say about their experiences in these courses? How have they benefited from this training? • And what alternative means are available to me to develop these practical skills? 2. A credential that sends a signal to the marketplace. No career paths absolutely require an MBA – it’s an
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markets might I seek to enter in the future? • Who’s interested in my services? How might this change if I had an MBA? • How are MBAs perceived in these markets? What signals does an MBA send in these markets? What stereotypes (both positive and negative) might I face as an MBA? • What is the specific reputation of the MBA programs I’m considering? How are these schools and their alumni viewed within my desired markets? • And what alternative means are available to me to send the signals I desire to communicate? 3. Membership in a learning community and access to an alumni network. Business school emphasizes working in groups, and MBA students often learn as much from their peers as they do from faculty, so it’s important to consider who you’ll be working alongside for two years. Those same people will become your fellow alumni, and access to that network is one of the most valuable benefits an MBA program can offer.
Of course, alumni networks aren’t created equal. Larger MBA programs yield larger networks. Certain networks are concentrated in specific geographic areas or in specific industries. And some B-school experiences create networks that are particularly active sources of mutual support. I’ve benefited tremendously from the support of my fellow GSB alumni during two major professional transitions. In my job search after graduation and later when I began exploring executive coaching as a career path, other Stanford alumni were extraordinarily generous with their time and insights, and there’s no way I could have succeeded without their help. All this said, there’s a misperception about the importance of socializing in business school as a means of cultivating these ties. To be sure, my students devote a substantial amount of time and energy to elaborate social activities, and I often find myself amused at the lengths to which they go to entertain themselves. However, while it’s true that I’m middle-aged
and boring, and a quiet night at home is my idea of a good time, I was pretty boring even as a student, and I didn’t spend much time at parties or other social events. But I didn’t need to in order to benefit from the GSB network – the school’s relatively small size and communal culture help ensure that graduates feel a sense of obligation to help fellow alumni. And the fact that I can’t pay back the many people who helped me is motivation to “pay it forward” by doing as much as I can to support recent alumni seeking help from me. So ask yourself: • What do I know about the students at the MBA programs I’m considering? Are they like-minded peers? Do I see myself learning alongside them? • What do I know about the alumni networks of these programs? How active are they? Are they concentrated in geographic areas and professional fields of interest to me? • What support does a school provide to its alumni network and to individual alumni? Do alumni return frequently to participate in events and
activities at the school? One final point on diversity: I have no doubt that my experience in business school was made substantially easier by the fact that I’m a straight, white, American man with an Ivy League undergraduate degree. Even as MBA programs have sought to attract more diverse student populations in recent years, B-schools are still disproportionately filled with people like me. And even at Stanford, which prides itself on its inclusiveness, I know that women, gays and lesbians, people of color, students from outside the U.S., and non-native English speakers can feel isolated in business school and find the MBA experience more difficult and stressful. I hope to encourage people from a wide range of backgrounds to consider business school as an option, and it feels important to acknowledge this current state of affairs if anything is to change. This article originally appeared on the Harvard Business Review website at HRB.org
city & state — October 12, 2015
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cit yandstateny.com
By LAURA TUCKER
1. INVEST IN YOUR FUTURE Although it’s not strictly necessary to have a firm view of your future career before applying to graduate school, it certainly helps. This is because grad school often acts as the academic version of professional training, enabling students to graduate with all the right knowledge in all the right places, ready to jump straight into their desired careers. 2. GET NOTICED IN TODAY’S JOB MARKET An undergraduate degree alone can sometimes fail to get you noticed alongside equally or more highly qualified candidates. With university education in contemporary society increasingly viewed as more of a rite of passage than a luxury, bachelor’s degree holders are struggling to appeal to employers even at entry level in certain industries – especially when up against candidates with Ph.Ds. 3. GET MORE THAN A QUALIFICATION Whereas much of the worth of an undergraduate degree is in the qualification itself, the most important reasons to go to grad school may be more for the professional skills you’ll gain, the personal development you’ll undergo and the valuable connections you’ll make. 4. PURSUE YOUR INTERESTS IN MORE DEPTH In order to get the most out of your cit yandstateny.com
graduate degree, you will be expected to conduct personal research alongside set study topics, in order to develop your thoughts and ideas regarding something that deeply interests you. Attending extracurricular activities and meetings, hearing from guest speakers and lecturers as well as full-time faculty members you find interesting, is what makes grad school so diverse and multidisciplinary. 5. CONTRIBUTE TO THE WORLD’S KNOWLEDGE If you’re someone who wants to contribute to the world within any field, professionally or academically, you’re going to have to know your subject inside-out. Kylie Rochford, a graduate student, explains that “undergraduate study gave me the opportunity to understand existing knowledge in my field. Graduate school gives me the opportunity to contribute to that knowledge.” 6. MAKE CONNECTIONS While undergraduate-level student life is widely associated with socializing, sleeping late and cramming alone in the library, grad school is much more about connecting with people professionally – not just fellow graduate students but faculty members too. 7. INCREASE YOUR FINANCIAL PROSPECTS Bettered financial prospects is a popular answer to the question “Why go to graduate school?” – though it may not necessarily be the most important factor. Even so, a graduate degree has been found to improve the financial prospects of workers more each year, compared with someone holding just a bachelor’s degree. 8. GET ACADEMIC RECOGNITION Grad school provides a stable forum to research and explore theories and ideas. If during your degree you conduct any research that is particularly exceptional, the chances are you’ll be recognized for that achievement by
the academic community – perhaps by being invited to present your paper at a conference, contribute to a research project, and even receive accreditation in a piece of work published in a journal. International recognition is also a prospect for those who continue their research after graduation, and one day, who knows? You may well become a prominent expert in your field. 9. WORK WITH THE BEST At grad school you’ll be surrounded by leading thinkers in your field. When working with people we’re inspired by and look up to, staying motivated and working hard is much easier. Additionally, you’ll have access to excellent resources.
10. GAIN AN INTERNATIONALLY RECOGNIZABLE QUALIFICATION Although last in this list of reasons to go to grad school, gaining a qualification which is recognized by employers around the world is incredibly important to many prospective graduate students. This is particularly the case for international students and students wishing to work abroad.
This article was originally published as part of the annual QS Top Grad School Guide which can be accessed at TopUniversities.com. It has been edited for space and clarity.
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city & state — October 12, 2015
“Why go to graduate school?” is a question many students ask, unsure of whether grad school is really the best way to help them achieve their career goals. The cost in tuition fees and length of time out of employment can mean applying to graduate school is a decision not to be made lightly. For this reason, it is essential that your overriding reasons to go to grad school are firmly founded. Below is a list of 10 of the most common reasons to go to grad school.
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10 GOOD REASONS TO GO TO GRAD SCHOOL
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Georgetown University Law Center
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CITY & STATE — October 12, 2015
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OPINION
OPINION
IF HE CAN’T RAISE THE AGE, CUOMO SHOULD WIELD HIS POWER TO PARDON
city & state — October 12, 2015
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Albany’s failure to act on Gov. Andrew Cuomo’s “Raise the Age” initiative leaves New York and North Carolina as the only two states in the nation where the age of criminal court jurisdiction is set at 16. The question now becomes, where does the governor take his initiative from here? How does he move this agenda forward while building momentum for future legislative action? In his memoir, “All Things Possible,” Cuomo writes, “A good governor is like a good baseball pitcher; you need a number of different pitches in your arsenal. When soft pitches don’t work, you sometimes need to throw one inside and tight.” With the raise the age bill falling short with the Legislature, the governor now has another pitch in his arsenal: the capacity to advance the raise the age initiative by leveraging his constitutional authority to grant pardons. Before introducing the bill, Cuomo appointed a commission of criminal justice experts who were tasked with developing this legislation. One of the central issues that the commission addressed was that minors in the adult court system were exposed to the lifelong stigma of a criminal conviction. The commission wanted to “provide meaningful opportunity for a life without the stigma of a criminal record for adolescents who turn away from crime.” As such, the commission recommended that individuals who have one criminal conviction on their record incurred before the age of 21 would have an opportunity to get that record sealed after a number of years, as long as they are not convicted of any further crimes. The wait time and subsequent sealing procedures would vary according to the seriousness of the offense. For a misdemeanor and a nonviolent felony, the wait time would be two years and five years, respectively, and the procedure would be administrative. For a class of more serious offenses committed at the ages of 14 and 15, the wait time would be 10 years, and the sentencing court would make the
PHILIP KAMRASS / OFFICE OF THE GOVERNOR
YUVAL SHEER
decision. The sealing of the record would be “conditional,” meaning that the record would be unsealed if another crime is committed, and the sealed records could still be viewed by law enforcement agencies. Cuomo can act on the commission’s recommendation without any legislation because the state constitution vests him with the authority to relieve individuals of a criminal record by granting them a pardon. Indeed, the governor has the power to make pardons, just like the commission recommended, conditional on individuals not reoffending. He can also ensure that the pardoned convictions will be accessible to law enforcement agencies. The state constitution is clear about the governor’s power to tailor a pardon, which he can grant “upon such conditions and with
such restrictions and limitations, as he or she may think proper.” The operational aspects of reviewing and determining the eligibility of a large number of pardon requests can be modeled after President Barack Obama’s effort to commute the sentences of federal prisoners who were convicted of nonviolent drug offenses. The governor could establish pardon application criteria for convictions incurred at a young age, consistent with his commission’s recommendations, and engage volunteer attorneys to help in the screening of cases and preparation of applications for expedited review by the executive. By December, the governor could be in a position to grant a large number of pardons for individuals who were convicted at a young age and
subsequently turned away from crime. Besides giving so many New Yorkers a true second chance, Cuomo would put a human face on the suffering of so many New Yorkers who are forever defined by mistakes they made as minors, and would regain momentum for his stalled legislative initiative. Instead of waiting another year for the Legislature, the governor could take his own advice and “throw one inside and tight.”
Yuval Sheer is an attorney and the former deputy director of the New York Center for Juvenile Justice.
cit yandstateny.com
OPINION
AN OPEN LETTER TO A
BUMBLING MAYOR EVAN SIEGFRIED
While I am perfectly content to watch the steady decline of your poll numbers as you bumble your way from gaffe to gaffe, I am not going to do so at the expense of New York City and New Yorkers. Your success is New York City’s success, your failure is New York City’s failure. Accordingly, I am writing you to offer recommendations on how you can improve things. I am certain that your response to this will best be summed up by the emoticon: ¯\_(ツ)_/¯. The first thing you must do is change the hours in which you work. This means no more late-morning visits to the Park Slope YMCA (or any gym for that matter) during normal business hours. Start your days early and get to the office at 7 a.m. on the dot, and keep charging through your day at City Hall until at least 9 p.m. New Yorkers like and respect a mayor who works around the clock. Yes, you have argued in the past that the miracles of modern technology make it possible for you to work remotely from anywhere, but that doesn’t cut it for the mayor of the biggest city in the country. We expect you to be behind your desk, working the phones and diving into the issues that confront New Yorkers on a daily basis. One way to demonstrate that you are in command is through the Mayor’s Management Report, a biannual report required by the city charter that provides a view into the operations of the city. Mayors before you would present every facet of the report at a large press conference that lasted at least two hours and take questions on any topic. Instead, you have relegated the report to little more than a glorified press release, and vague “promises” to improve the delivery of city services. In fact, ambulance response times have gotten worse (perhaps an unintended consequence of Vision Zero and increased bike lanes?). Actually presenting the report in an honest, detailed manner would effectively counter the criticism that you don’t care about managing the city. You insist that the city isn’t cit yandstateny.com
backsliding to the “bad old days,” a warning that was issued to voters in 2013. Apolitical New Yorkers are witnessing and noticing a decline in the quality of life in this great city of ours, which in turn is responsible for your declining poll numbers. Street homelessness has visibly increased since you took office, and your piecemeal solutions have not impacted it for the better. In fact, they haven’t even made a dent. Now is the time to find a working solution that helps the least fortunate get off the street, into a shelter, and ultimately into permanent housing. Mr. Mayor, you need to be asking yourself the tough questions, such as, “Why are the homeless choosing to spend the night on the street as opposed to a city shelter?” The most common answer is that the shelters are overcrowded and not safe to reside in. Or you could ask about how to reduce violence caused by events surrounding the West Indian Day Parade, particularly the J’ouvert celebration. You would find that J’ouvert is a celebration that operates without a permit, so all you need to do is have the men and women of the NYPD shut it down. Bonus benefit: New York’s Finest hates J’ouvert and getting the order to shut it down would increase your popularity among the rank and file.
Another way to debunk the notion that you are using City Hall as a stepping stone? Stop trying to insert yourself into the national debate. Your travels and prognostications have achieved zero tangible results for New York City and only reinforce the perception that you are aloof. If you will not curtail these travels, then at least focus them in a manner that would maximize the chances of a positive impact for New York City. For example: Last month, Jon Stewart led a coalition of New York City firefighters (full disclosure: I represented the firefighters union in their quest for you to give their minority members equal disability benefits) to Washington to lobby for making the Zadroga Act permanent. You should have joined them. (You have only issued short boilerplate statements on this issue and it has reinforced the belief that you don’t support cops or firefighters.) But your priorities lie elsewhere: News broke later in the month that you want to hold your own Democratic presidential forum … in Iowa. Even if you fancy yourself a “kingmaker,” you have clearly faltered in that role. Your refusal to endorse your former boss Hillary Clinton in the Democratic presidential race is not only politically baffling, but potentially damaging to New York’s health and well-being. If Clinton were to win the
White House, how inclined would she be to help you, and by extension New York City, when you ask for federal assistance? Heck, she would more than likely seek to make you squirm, and it would be at New York’s expense. Playing a game with this endorsement by needing to “hear more” and meeting with her rival, Bernie Sanders, is just poking a bear with a stick. Endorse Hillary Clinton now, and move on. It’s time to stop picking fights with the press. The Post and Daily News have always had an adversarial relationship with the mayor of New York City. The old adage of not picking a fight with somebody who buys ink by the barrel applies here. While you just dodged a bullet with Eva Moskowitz deciding against a mayoral run, New York Democrats are still openly discussing who should primary you in 2017. It is certain that you and your operatives in City Hall are already running campaign-style attack operations on likely challengers such as Scott Stringer, Tish James, Hakeem Jeffries and Rubén Díaz Jr. This sort of speculation about your political fortunes and rivals is likely infuriating. It’s important that you channel this anger into better management of the city. Dive into the nitty-gritty of filling potholes, cleaning the streets, helping the homeless off the streets, curbing gun violence, decreasing the response times of ambulances and reversing the decline of quality of life. Taking this advice will beget better poll numbers, and an increased national standing beyond stamping yourself as the superficial “progressive” standardbearer. Ignoring it will do irreparable damage to your political brand, and your political fortunes at home. Sincerely,
Evan Siegfried,
a concerned New Yorker
Evan Siegfried, a Republican strategist, is president of Somm Consulting, a public affairs firm based in New York City. He can be followed on Twitter @evansiegfried.
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A KATZ / SHUTTERSTOCK
Dear Mayor Bill de Blasio,
OPINION
WE ALL NEED THE MTA DENISE RICHARDSON, MARCIA BYSTRYN, THOMAS WRIGHT, JOHN RASKIN
city & state — October 12, 2015
PIO3 / SHUTTERSTOCK
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For all the rhetoric surrounding the 2015-2019 MTA capital program since it was proposed over a year ago, one thing is crystal clear: The MTA always has and always will be the lifeblood of both New York City’s and New York state’s economy. And when there’s a will, there’s a way, and in this case that way involves city and state stakeholders putting aside their differences to keep the agency chugging along by funding and finalizing its five-year capital program. The last capital program created over 20,000 new jobs throughout New York City and state and generated $37 billion in economic activity, more than the cost of the currently proposed program. Since that program started in 2009, total subway ridership has grown from 1.58 billion riders to 1.75 billion riders in 2014. That number is expected to climb to 1.77 billion by the end of this year – the highest in 65 years with no signs of slowing down. In 2014, there were two dozen weekdays where subway ridership exceeded 6
million and we expect even more by the end of 2015. Metro-North ridership is the highest in 30 years at 84 million riders annually and is also home to the nation’s largest pool of “reverse” commuters (those commuting from New York City to Westchester, Connecticut and points beyond). Long Island Rail Road ridership continues to grow, and New York City Transit is serving the needs not only of commuters but also the 50 million-plus tourists that visit each year. Whichever part of the MTA network one rides, one expects a safe and reliable trip, not just within the confines of the five boroughs, but throughout the region. Increased ridership puts additional strain and demand on the entire system, making capital investment a greater necessity. As we learned from Superstorm Sandy, fortifying the MTA network is critical to the region’s overall mobility as we adjust to the increasing likelihood of extreme weather events. The MTA capital
program includes system expansion and enhancement, state of good repair and resiliency projects to meet growing demand and increase service and reliability. Discussions about the means to fund the program should not pit one type of project against the other; all are equally important if we are to build the network that will meet the needs of a growing region. With the delay in approving the capital program, the MTA has effectively lost almost a year in initiating the projects that are critical to meeting its service demands. There is no more time to waste. The city and state must come together to find the necessary dollars to provide the tools the MTA needs to continue to preserve and expand its network. Taking on more debt or passing the cost on to straphangers through draconian fare hikes are scenarios both sides should want to avoid. Let’s focus on the mission at hand and find a path to a revenue scenario that is equitable for all stakeholders.
Whether one is visiting from overseas, heading up to Poughkeepsie, commuting from Long Island to Manhattan, taking a child to school or manufacturing a subway car in Plattsburgh, we all rely on the MTA, its services and the jobs they create across the region to grow our economy. It does not matter if one is a resident of the city, the suburbs or upstate, we all need to get on board Team MTA. It is in all of our interests to keep the MTA on a sound financial track. Denise Richardson is the executive director of the General Contractors Association of New York; Marcia Bystryn is the executive director of the New York League of Conservation Voters; Thomas Wright is the president of the Regional Plan Association; and John Raskin is the executive director of the Riders Alliance.
cit yandstateny.com
OPINION
IS THERE ANY SUBSTANCE BEHIND THE UPSTATE SECESSION MOVEMENT? RICHARD BRODSKY
cit yandstateny.com
hurt – and who is helped – if upstate secedes? It depends on what you value. As a purely political exercise, secession movements have supporters everywhere in the world, be it Scotland, Catalonia, Ukraine, Tibet or Rochester – “we” want no part of “them.” In New York, that’s a reaction to population and demographic shifts, and being in a voting minority. If upstaters primarily value political control, secession holds some appeal. But a major argument for secession is the need to put upstate in charge of its own economy and throw off the economic drag of downstate. Again, there’s a functioning lobbying organization, Unshackle Upstate, and a core of supporters for Republican, conservative, supply-side austerity economics. The group has powerful friends, like the Business Council of New York State, which advocated for secession in a 2004 report: “Policies and costs are imposed on the upstate economy in ways that would not happen if upstate were a standalone state (with) the freedom to reduce the disadvantages that are smothering its economy.” Here’s where reality ought to impinge on anger and ideology. It is the indisputable, if inconvenient, truth that upstate is the beneficiary of billions of dollars of subsidies paid by downstate taxpayers. This makes intuitive sense
– the downstate economy thrives and the state tax system is progressive so that wealthier downstaters pay more in taxes than less affluent upstaters. There is a trove of data to confirm this point. The best comes from the widely respected Rockefeller Institute of Government, whose 2011 report, “Giving and Getting,” makes the case impeccably. The report found that New York City makes about 45 percent of state tax payments and gets back 40 percent in state expenditures. The downstate suburbs provide 27 percent of taxes and get back about 18 percent of state expenditures. Upstate pays about 24 percent in taxes and gets back around 35 percent of state expenditures. (There are also out-of-state taxpayers that make up the remaining 100 percent.) The conclusion: New York City and downstate suburbs give far more than they get, while upstaters, by contrast, get significantly more than they give. In dollar terms, that’s a sweet deal for upstaters – a $1,700 subsidy for each upstate resident courtesy of downstate taxpayers. In aggregate, that equals around $8 billion. This is a problem for the secession movement. From a practical standpoint, no matter how tough things are in the upstate economy, a loss of $8 billion annually would create genuine havoc. Politically, an $8 billion subsidy, voted on without complaint by the devilish
downstate majorities, undermines the convenient notion that nobody cares or does anything about upstate. The first question is whether this arrangement is fair. Well, it is fair if you share the long-standing principle that wealthier persons and wealthier communities should help support the less wealthy. That was, until recently, the unchallenged theory of American government. With the rise of the Tea Party and austerity economics, there’s now a counter-meme: flat taxes and everyone watches out for his or her own needs. There is considerable irony in the politics of all this. The loudest voices in support of austerity and reduced government taxes and spending are the prime beneficiaries of the system they oppose. Be it Unshackle Upstate, or the Business Council of New York State, or upstate politicians and citizens, there’s a cautionary note here: Be careful, the downstate establishment might decide to agree with you. There’s just as much political advantage for a downstate firebrand pushing secession as there has been for the advocates who have led the effort in demonizing downstate. It wouldn’t surprise me at all if a smart downstate legislator called upstate’s bluff. There are enormous mechanical problems to any attempt to secede, which makes it an unlikely realworld outcome. But these regional divisions, once unleashed, bounce around the body politic with unknown consequences. There’s nothing wrong with examining policies and practices as they affect our differing communities, and one would like to be both sympathetic and helpful in getting the upstate economy revved up. But feeding the secessionist beast makes that a harder thing for people of goodwill to do.
Richard Brodsky is a former assemblyman who is in the private practice of law and serves as a senior fellow at both Demos and NYU’s Wagner School. He is a regular columnist for the Albany Times Union and The Huffington Post.
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New York’s upstate secession movement is not going away anytime soon. There have been bills introduced in the state Legislature, and upstate business interests periodically fan the flames of this movement. Even Gov. Andrew Cuomo plays the regional resentment card, as he did during a recent interview on “Capital Tonight” in August: “When the majority (of the Legislature) are from downstate and you are from New York City, you’re all allied in one agenda, which is the New York City agenda,” and added that upstate advocates are “outgunned in the legislative process.” Bashing downstate is a timehonored way to grandstand before upstate voters, as former Republican Congressman Randy Kuhl (then a state senator) figured out when he suggested to The New York Times in 1999: “Why don’t you just cut the city of New York off and let it drift out to sea?” This mythology of upstate/downstate animosity is popularly entrenched, as made clear by respondents to a 2009 Rochester Business Journal poll, in which 67 percent favored dividing New York into separate states: “We have no clout upstate when it comes to ‘revenue distribution’ or controlling unfunded mandates,” said Rob Bick, an assessor in the town of Clay in central New York. “We have half the programs in our schools and twice the tax rates because the school aid formulas are tainted towards downstate revenue enhancement.” “The tax burden for the welfare portion is legislated by the relatively rich downstate legislators and largely paid by those upstate,” said Donna Cullen, an upstate resident. And from that same poll: “Upstate New York would thrive without downstate. The new state could eliminate the many mandates that the downstate legislators have imposed upon us. This would reduce the cost of government, schools, etc. The new state could become a low-tax haven for people and businesses,” said John Rynne, president of Rynne, Murphy & Associates Inc. Is there something substantive behind these comments beyond anger and frustration? Who actually gets
OPINION
THE LIMITS AND LESSONS OF DE BLASIO’S UNIVERSAL PRE-K PROGRAM
city & state — October 12, 2015
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Circle time at preschool offers the perfect forum for moral lessons, such as basic civility. So, when little Lela’s humbled voice peeped from the back of the classroom at Castle Bridge Elementary School in Washington Heights, “I’m ready to come back,” teacher Katie Wassel figured the lesson on good manners had been duly noted: You can’t elbow your neighbor during circle time. Shifting her gaze to another child, Wassel attempted to recapture the youthful exuberance. “What does the author mean by ‘gigante’? Little Anthony waved his hand to answer, pressed tightly into this restless semicircle of 4-year-olds. With equal verve, Mayor Bill de Blasio aims to draw a giant, inclusive civic circle all his own. He’s warmly embracing middle-class families with the gift of free preschool, as I saw at Castle Bridge, where Dominican families warmly blend with Upper West Side professionals. The mayor hopes to illustrate on this small policy canvas how broad social entitlements can lift children, backstop families and make his daunting metropolis feel more affordable. But de Blasio has stumbled down a rocky road in carving out some 65,000 pre-K seats for 4-year-olds. The mayor belatedly discovered that public schools lacked the space; Jewish leaders insisted on time for religious instruction; middleclass neighborhoods eagerly outbid their less fortunate peers. The mayor’s noble, yet clumsy, initiative offers clear lessons for would-be progressives who claim magical benefits for all from cookiecutter entitlements. Lesson 1: Stick close to the evidence on which families or clients will reap the rewards. The mayor has pursued two policy goals at once – claiming to narrow severe disparities in children’s early learning and elevating poor youngsters, while also relieving pressure on household budgets, including better-off families that already enjoyed a richer pre-K supply. A half-century of research shows
ROB BENNETT / MAYORAL PHOTOGRAPHY OFFICE
BRUCE FULLER
strong and persisting benefits for poor children that attend high-quality preschool. Comparable gains appear in two local studies, done in Boston and Tulsa, for children of blue-collar parents or first-generation English speakers. But large national studies – tracking tens of thousands of preschoolers – find tepid and fading benefits among children of middle-class families, probably due to the richness of language in these households along with parenting that encourage their children’s ideas, feelings and problemsolving. But de Blasio insisted in September that “the jury is back on pre-K … the fact that it’s universal, I believe, lifts all boats.” On this point, the mayor either echoes bad advice or is simply
ignoring the research. Because if the city’s quality preschools do raise the early growth of allchildren equally, and not specifically the poor, how would that narrow distressingly wide gaps in children’s early growth? We have made great strides in lifting average test scores in K-12 education over the past 40 years, but painfully little progress in narrowing achievement gaps among racial or social class groups. Lesson 2: Anticipate stronger demand for entitlements from better-off families and stronger interest groups. The overall supply of preschool seats was about one-third greater in better-off parts of the city, relative to poor neighborhoods, as de Blasio leapt into the field. His expansion of pre-K seats has spurred even greater demand
from middle class and blue-collar families, eager to save thousands of dollars by shifting their 4-year-old to a free pre-K program. Yet enrollments inched up by just 1 percent in September in the poorest one-fifth of CIP codes relative to last school year, according to my research team’s analysis of city data (which remain publicly unavailable). Over 12,000 4-year-olds residing in the two-fifths of city neighborhoods with the lowest household incomes remain outside any public pre-K program. Unbridled entitlements are often co-opted by better-off players. Think farm subsidies: at first a well-meaning effort to hedge against the risk of fickle agricultural prices, especially perilous for small family farms. But Washington cit yandstateny.com
CIT YANDSTATENY.COM
Bruce Fuller, a sociologist at the University of California, Berkeley, is author of “Organizing Locally: How the New Decentralists Improve Education, Health Care, and Trade” (Chicago, 2015).
Letters
to the
Editor
The New York state Legislature should authorize localities in the state to do what New Jersey has authorized their localities to do – provide residents with the opportunity to benefit financially if they shop local. A few years ago New Jersey authorized localities to implement a shop-local program that benefits taxpayers. A portion of the normal purchasing dollars spent annually on goods and services is applied against the property tax bill, thereby reducing taxes at the end of the year. One community, Marlboro Township, initiated the program and it is a win-win! The Marlboro Township development committee has initiated a Shop Marlboro program that promotes local businesses and enriches the sustainable goals of a wellorganized shop-local campaign. There is an uptick in business and more businesses are participating. The Shop Marlboro property tax reward program is available to all property owners with no cost to residents. Coded Shop Marlboro cards donated by Investors Bank are used at establishments that participate in the program. A percentage of each sale is applied toward the resident’s property tax bill. It is not a credit card. During 2014, Marlboro businesses realized more than $1,000,000 in sales and residents saved nearly $65,000 on their property taxes. There are currently 50 local businesses that participate with about 3,500 residential properties registered. I have been in touch with another community – Manalapan, New Jersey – and they also have reported successes with the program. We all want our taxes to go down. This program helps reduce real estate taxes. We all want our local stores to be more successful. This initiative encourages shoppers to shop locally. I have written to the governor, state legislators and to our business leaders encouraging them to support this program for New York communities. –Paul Feiner, Greenburgh town supervisor The following letter is a response to an opinion article by former Assemblyman Richard Brodsky, “Is there any substance behind the upstate secession movement?” in which Brodsky debunks the belief that upstate New York gets short shrift when it comes to state resources. The piece ran online on Oct. 3 and can be found in this issue’s opinion section. As usual Richard’s writing is quite thoughtful. The only problem I have with it
is that he’s writing as a downstater, and I view this question as a lifelong upstater. The writer is a former Assembly member from Westchester County who heads south to New York City far more often than he heads north. I know he’s an avid outdoorsman who likes to spend time in Wyoming but, I bet, is not likely to spend much time in Wyoming County. Richard is right that the New York City/ downstate economy does send more money around the state than it gets back in aid, but he misses the point that the secession supporters are making, which is: If we didn’t have all of your mandates, we wouldn’t need all of the state aid to support our government services. And if downstate lawmakers didn’t stop us from developing our resources and economic potential, we wouldn’t be losing our residents and our children to other parts of the nation. Upstate New York’s economy and government services would likely look very different if it were organized as another state. Agencies would be much smaller and look to work with local officials and business owners to find workable solutions to problems rather than fighting with them “because they can.” I highly doubt energy costs, property taxes, tolls and other taxes and fees would be where they are today, because upstaters would seize on the opportunities that they have in the high-tech economy and energy production, as well as the strength of our research and higher education institutions. Would it be an easy transition? Not at all. Everyone would have to contribute to make it work. Businesses would need to accept lower profitability in the short run, local governments would have to consolidate and public sector workers would need to work with local taxpayers and employers and retool contracts that the reduced tax base could afford. Without this cooperation and jointly sharing of the burden, you’d end up with massive public sector layoffs and diminished services. But it would be temporary. An unshackled upstate/western New York would thrive in a short period of time. While I prefer one New York to two, I have little doubt that if the secession movement “got what they wished for” they’d make it work and it would look very different than it does today from the point of view of residents of Franklin, Otsego or Yates counties than it looks from tony Greenburgh. –Steve Williams, on www.cityandstateny.com
CORRECTION: “Education in Exile,” a report in our Sept. 28 issue about the struggles refugees face in the New York school system, incorrectly stated that the International Preparatory School at Grover Cleveland in Buffalo was phased out. Grover Cleveland High School was phased out, but the International Preparatory School is still in operation.
OPINION
call this a “substitution effect,” where expanding one slice of a sector simply pulls clients from another, rather than actually widening access to additional families. Some culling of mediocre programs may be wise. The mayor’s initiative now incrementally boosts the salaries of pre-K teachers, likely drawing in young graduates with stronger training. But the disabling of high-quality preschools in poor communities may explain the near-zero growth in seats seen in September across the poorest neighborhoods. De Blasio’s well-intentioned initiative reflects a deeper dilemma for Democrats going forward. Party leaders promise to lift the poor and buttress America’s anxious middle class. Hewing to that philosophy, selfdescribed progressives like de Blasio push for universal entitlements, from free preschool to priceless community college for all. But do such policy strategies actually lift the relative status and long-term fortunes of the poor? Or, does government simply assume the costs of social institutions to which better-off parents are no longer asked to contribute, even as the distribution of supply benefits them most? The alternative strategy is to progressively tax affluent individuals and corporations, redirecting aid to families who can’t afford to pay for quality pre-K or enter an Ivy League college. This remains Washington’s preference as it expands Head Start and Pell Grants. Now, de Blasio has upped the ante, betting that imprecise entitlements will build a bigger tent, drawing that gigante civic circle. His embrace of middleclass voters – who worry about their mortgage or how to save for college – feels honest and essential. Cities wither when young families flee, worried sick over affordability, mediocre schools and lousy public transportation. But unless public initiatives award the poor and working-class families even a shallow stake in civil society, the city’s vitality will suffer as well. The mayor might admit that he’s really not keen on narrowing stark gaps in children’s early learning. Or, going forward, he might center his efforts on this singular goal, to demonstrate that he is truly dedicated to a more inclusive society.
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CITY & STATE — October 12, 2015
still spends billions on price supports that subsidize huge corporate growers. President Barack Obama’s health care reform offers another strategy, attaching a national entitlement to medical insurance, while avoiding taxpayer subsidies for citizens or corporations that can afford to pay. Washington and state exchanges then aim public dollars toward individuals or families that cannot afford market prices. Obama has similarly pushed to expand pre-K seats in poor communities, while raising tax credits for truly middle-class families to ease their child care costs. Lesson 3: Learn about the organizational landscape. At first, de Blasio’splanners assumed he could create 72,000 pre-K seats within the public school system. This brought smiles to the faces of labor leaders, forecasting thousands of new teaching jobs and union members. But the mayor’s deputies seemed unaware that some 1,900 community organizations – YWCAs, Head Start, religious institutions – have long run most city preschools, going back to the likes of Dorothy Day a century ago. The mayor, however, has proven to be a quick learner. He allowed Jewish preschools to shoehorn spiritual instruction into a secular curriculum, approved bilingual pre-K programs and even allowed charter schools to play ball. Richard Buery, the deputy mayor for strategic initiatives, acknowledged that there are 103,000 4-year-olds in the city, not 72,000, the figure that was to signal the arrival of “universal” access to pre-K. The city’s rainbow of preschool providers means an equally colorful range of ways to teach and socialize its young charges. This fragmentation challenges de Blasio’s affection for standardized regulation of classrooms. When asked recently how he would define a “quality” preschool program, de Blasio said, “We’re working with a Common Core curriculum … a carefully calibrated curriculum to prepare them to be on target for their next experience up ahead in kindergarten.” But Common Core lesson plans don’t extend down to toddlers and preschoolers. That’s a good thing, according to many child psychologists, who find that young children learn best by engaging with a range of tasks, expressive play, and each other – rather than sitting at desks reciting phonemes. Ignoring the existing landscape, the city’s sudden spike in pre-K seats, now free in the public schools, has pulled between 10,300 and 14,900 children from neighborhood centers that failed to win public funding and must still charge fees, according to our survey of pre-K directors. Policy analysts
BACK & FORTH
HOME STRETCH Horse racing is often considered
the sport of a bygone generation. So it’s surprising that the racing manager of the first Triple Crown winner in 37 years just graduated college this year. Justin Zayat has managed the horses of his father Ahmed’s Zayat Stables since 2012, including American Pharoah, who completed the Triple Crown at his home course of Belmont in June. Now the most famous horse in the world is preparing for his final race, the Breeders’ Cup. Zayat, a native of the New York metropolitan area, sat down with City & State’s Jeremy Unger to discuss the end of American Pharoah’s career, whether the New York Racing Association board should cede control to private leadership, and his favorite racetrack in the world. The following is an edited transcript.
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City & State: A lot of horse commentators talk about how a great horse comes from an excellent breeding line or just the raw speed or power of the animal. What for you stands out the most about American Pharoah? Justin Zayat: This sounds really clichéd, but how really easily things come to him. What amazes me every day and what I would take away from American Pharoah as a life lesson is, you know, this horse goes out every single day and trains and trains awesome. Every single day I get a call from my trainer Bob and he’s just like, “Wow. Pharoah was amazing out there.” If you’re into horses you know no horse has been 100 percent and unbelievable every single day, day in and out. This horse doesn’t care if there’s a hurricane outside or if it’s the most beautiful weather – he’ll just go out and train. He’s always has a great mentality and that’s something that really stuck out to me. C&S: There’s been a lot of talk about the best track in the country and a lot of people argue it’s Saratoga, even though it’s not included in the Triple Crown. Do you personally have a favorite track? JZ: That is tough. Belmont is a favorite track of mine because it’s so close to
the week of the Travers, you’d say, “Wow, people say racing is bad here? No way.” We had 20,000 people come out at 7 a.m. in the morning, just to watch American Pharoah train. That’s what this horse did. It brought people back to the tracks again, which is what people love.
A Q&A WITH
JUSTIN ZAYAT the city. I grew up going there all the time, I still go there every week. It’s my hometown track. That’s what was so cool about the Belmont stakes, the Triple Crown, everything, because it was right in New York where I was all the time. On a prestige level, when you go to Saratoga, there’s no more prestigious racing in all the world than Saratoga. It’s the boutique race, the race of the summer. It’s like the Hamptons in the summer, all the families come up in the summer and just want to win a race in Saratoga. Anytime you win a race, it can be a small race or a big race, it’s always going to end up being a big win for you just because of where the location is. But my favorite, favorite personal track is Del Mar in California, because you can’t beat the weather in the summer, it’s right near the beach, where the turf meets the surf, and you can’t beat the vibe there. I’m there for the whole entire month of August. But Belmont holds a close second in my heart because I’m there all the time and it’s my home track. C&S: There have been a lot of questions recently about the future of the New York Racing Association and racing in general in New York.
New York state controls the board of the association and the races. Do you and does your stable worry about that situation? JZ: It’s hard for me to comment on that because I’m not involved in the day-to-day operations and I don’t see how NYRA is run on a day-to-day basis. I can tell you since Chris Kay came into office in the last year as their new president, NYRA has just seen a big turnaround as an organization. The quality of racing is better, they built new barns at the tracks now, the facilities are looking better, so I think, overall, New York racing is on a big rise. The purses are up here, and you can’t compete with better purses than in New York state. They have the best purses, they’re getting a lot of the great horses out here. I don’t think racing is in as big of a trouble as everyone makes it seem. Maybe the attendance is not what everyone wants it to be on a day-to-day basis, we can work on attendance together, there are some ways we can work on that. But I think racing, especially since the Triple Crown also, has taken a big boom from it. They call it “the Pharoah effect.” It gave racing the shot in the arm that it needed. If people came out to Saratoga
C&S: You’re going into the Breeders’ Cup and it’s the last race for American Pharoah. How are you going to feel, regardless of the results, when you see him cross the finish line? JZ: It’s going to be sad. I’m sure at first there will be a little relief because there’s so much pressure going into these races. But I just want him to run well for himself. I don’t want him to go out on a low note, I want him to close out his career on a high note. But at the end of the race when he crosses the finish line that all goes in the garbage – who cares whatever happened at that point? So it’s going to be sad for me to see his last race, the last time the saddle goes on his back, a rider on his back, all those things. I’ve literally been watching American Pharoah since the day he was born, not like the average fan that started watching him this year. We’ve raised this guy from the time he was a baby, to winning the Triple Crown, to taking our family through all the great months that we’ve had, and it’s all coming to an end now. But then again, knock on wood, it’s about 17 days out, I’m just hoping he gets there happy and healthy and in one piece and comes out happy and sound. That’s really what I want for him at the end of the day, it’s more important than just running the race. I just want him to come out healthy and enjoy his next career, because he owes nothing to any of us and we owe the world to him.
For the full interview, including Zayat’s thoughts on getting young people involved in horse racing, and what made American Pharoah stand out, visit cityandstateny.com.
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