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On May 26, while Democratic Sens. Pedro Espada of the Bronx and Hiram Monserrate of Queens were deep in conspiratorial conversation with Republican senators and billionaire Thomas Galisano, Citizen Action of New York released its report New Yorkers Pay When Big Money Plays: The Case for Public Financing of Elections. In it, the good- government watchdog argues for public financing of elections by illustrating just how much persuasion the wealthy have over our political culture, and our policy future.

The report focuses on five pieces of reform legislation in which, as the document reads, “the Legislature did not reflect the public will on an issue. . . despite enormous support from grassroots organizations with large memberships and popular support.” These bills, including wetlands protection, discounts on prescription drugs, regulations on health-insurance rates, a cap on ticket resellers, and the repeal of vacancy decontrol, the report finds, are all significantly supported in one public opinion poll after another. However, each bill has languished for years in the state Senate. The reason, the report states, is found in the campaign contributions. In each case, contributions from industries that oppose the reform legislation outpaced contributions from supporters by more than 9 to 1.

And although the report is thorough enough, with persuasive arguments and supporting facts, nothing could have proven the thesis that big money corrupts politics as clearly as the events of June 8.

Someone should have offered Sen. Malcolm Smith (D-Queens) a blindfold and cigarette. On Monday (June 15), standing as erect as possible, his left eye twitching, the embattled majority leader of the New York State Senate introduced the new leader of the Democratic conference, Sen. John Sampson (D-Brooklyn). It was a concession that the Democrats had to make to woo back Monserrate.

“Monserrate wouldn’t have come back if Smith remained,” says Sen. Neil Breslin (D-Albany). Monserrate, he says, was angered by the small number of member items Smith had given him from the discretionary portion of the state budget.

Breslin, who competed against Smith for the majority leader position, now says, “I don’t know where my head was.” Smith’s tenure as leader, contending with an opportunistic cabal out to undercut him, is one that Breslin doesn’t envy. “He has done, under the circumstances, a remarkable job. Smith has been the victim.”

Now, with Monserrate back in the Democratic conference, the Republicans and Democrats are tied 31 to 31, with no lieutenant governor to break the tie. The legislators’ vain hope that the courts would decide on the legitimacy of the May 8 leadership vote has died with State Supreme Court Justice Thomas McNamara’s dismissal of the Democrats’ lawsuit challenging the vote’s legality.

Breslin reads from the decision: “The constitution leaves to the Senate the responsibility of selecting a temporary president. The issues raised by the parliamentary maneuvering on the Senate floor and the issue of whether a new temporary president may be chosen without first removing the incumbent. . . . these questions should be answered by the Senate and not by the court.”

The Republicans, along with Espada, have tried to hold session, but failed due to a lack of quorum. The Democrats have offered power-sharing compromises that the Republicans have rebuffed. In the final days of the legislative session, when we would usually see a flurry of legislative action, nothing is getting done.

“We made an offer,” Breslin says. “We said, ‘Let’s stop the posturing and the theatrics. Let’s meet at a table and decide the 100 or so bills that we need to get done before the end of session. Alternate Democrat and Republican, and leave town.’ And they answer, ‘But we’re in power!’”

A show of support: Supporters of Espada gather for a rally in Albany.

Photo: Alicia Solsman

There are basic housecleaning bills that need to be attended to, Breslin says, that include bonding issues and the extension of sales tax.

“There are many localities that are on fiscal years that begin July 1st,” says Blair Horner of New York Public Interest Research Group. “So they are putting their budgets together—New York City is one of them—they have either proposals to raise sales tax or to extend sales tax, and they expire June 30th. So, localities could be faced with cutting services or raising property taxes to compensate for a failure to extend those taxes.”

For a statewide example of the Senate’s leadership stalemate, Horner points to the extension for the bottle bill. “The law was passed, the courts threw it out,” he says. “There is a legislative fix for that, but what happens?” If the Senate doesn’t move on the legislation, the state, he says, “could have a $150 million hole in its budget ’cause the Senate can’t get its act together.”

And as far as reform legislation, Horner says, everything has been derailed. “Ethics reform and campaign finance are gone, family leave is gone, school governance in New York City is gone.”

“This was all about power,” Breslin says. “It has nothing to do with reform.”

Jessica Wisneski, campaigns director for Citizen Action, points out that the morning of the coup, reform legislation that would have begun the establishment of public financing for elections was set to move out of the Elections Committee. “Finally, our bill, after four years of the Senate not doing anything with it, was going to be moving out of the final Elections Committee meeting.”

The public-financing legislation that Citizen Action was pushing, she says, would have been phased in over the next four years, with the comptroller’s race in 2010, the legislative races in 2012, and statewide races in 2014.

“We got the Assembly to introduce their bill last year, and they passed it,” she says. “The same bill has been introduced again, and will probably be passed. And we had been working really hard on the Senate. We had gotten them to introduce a bill, and pass it through committee. We were really hopeful in these last two weeks that we would shore up support. I don’t think there were any Senate Democrats who were flatly against it.”

Along with clean elections, all five pieces of legislation examined in Citizen Action’s May report, Wisneski says, were in play before the coup.

“How much more evidence of the power of money in politics do we need?” Wisneski asks. “People are at their wits’ end.”

“I had HMO reform. We had this enormous, 40-page bill,” Breslin says, that would stipulate that the insurers would have to get prior approval from the Insurance Department before they could raise rates. “That doesn’t seem like rocket science, and we were all set to go. But then this alleged coup was like putting a pin into a balloon.”

The Senate Coup: a Timeline

August 2008: Majority Leader Dean Skelos (R-Long Island) sends erstwhile gubernatorial candidate and Rochester tycoon Tom Golisano a letter pleading for his help in holding onto the Republican majority in the upcoming election, making a case that the GOP’s positions are closely aligned with the billionaire’s. Golisano has been funneling big money to Democratic campaigns across the state through his PAC, Responsible New York, hoping that a change in leadership in the Senate will “reform” Albany government.

Nov. 4: Democrats win control of the New York state Senate, after decades of being in the minority, with a fragile 32-30 majority. Democrat Pedro Espada wins his election bid in the 33rd District of the state Senate, representing the Bronx, despite numerous allegations of ethical misconduct. As well as facing fines for being chronically resistant to disclosing campaign contributions, Espada is under investigation by Attorney General Andrew Cuomo for allegedly using funds directed to his nonprofit, Soundview Health Clinic, for political campaigns. In 2005, six of Soundview’s employees were convicted of directing the clinic’s funds, meant for the elderly and indigent, into a previous Espada Senate campaign.

Nov. 5: Espada forms an independent caucus along with fellow Democratic Sens. Hiram Monserrate from Queens, Ruben Diaz, Sr. of the Bronx, and Carl Kruger of Brooklyn. The renegade legislators, dubbed by the media as the Gang of Four, refuse to caucus with the Democrats, threatening the ascension of Minority Leader Malcolm Smith (D-Queens) to the position of majority leader, and positioning themselves for considerable leverage in negotiations for committee chairmanships and lulus.

Dec. 9-10: Now known as the Gang of Three, Espada, Kruger, and Diaz secure powerful concessions from Smith in return for their support of his leadership. Along with committee chairmanships, Espada would be named the majority leader, while Smith would be made the president pro tem. However, the three men still aren’t satisfied, and they go to the press to complain. Smith announces that the deal is off.

Dec. 19: Monserrate is arrested for allegedly slashing his girlfriend’s face with a broken glass during a fight in her apartment.

Jan. 6, 2009: Smith wins thin support from the breakaway Democrats, and starts the legislative session as the first African-American majority leader in New York state history.

April: At a meeting with Golisano, Smith apparently spends much of the time reading e-mails on his Blackberry. Golisano takes this as a slight, and allegedly begins plotting Smith’s downfall.

April 21: CBS 2 HD reports that Espada doesn’t actually live in his claimed Bronx residence. With a news camera running, Espada tried to sneak out of his Mamaroneck house, shielding his face with a baby. The Bronx district attorney opens an investigation into his residency.

May: Skelos, Espada and Monserrate start to discuss how to orchestrate a coup with Golisano and his partner in Responsible New York, Steve Pigeon. The group met secretly in apartments and at downtown Albany rock club Red Square, where they believed they would not be recognized by regular patrons.

May 4: Monserrate drops attorney Irving Seidman and retains the highly paid ($750/hour) Joseph Tacopina.

May 15: Golisano announces he is moving to Florida because of high taxes on the wealthy in New York.

May 28: Golisano writes a scathing letter to the editor, published in Times Union, explaining how he is merely part of an exodus of New Yorkers who are fed up with funding the Albany government. He asks, “How much should I personally pay for Albany’s bloated bureaucracy, corrupt politicians and regular handouts to special interests?”

June 8: At 3 PM, state Sen. Thomas Libous (R-Binghamton) calls for a resolution providing for a vote on new leadership in the Senate. This passes with the support of Sens. Espada and Monserrate and all 30 Republicans. Sen. Jeff Klein (D-Queens) calls for adjournment of the chamber. Officiating officer Sen. Neil Breslin recognizes adjournment and Democrats leave the chamber. In their absence, the Republicans and the two rogue Democratic senators hold a leadership vote, making Espada the Senate president pro tem and naming Skelos majority leader, again. Twenty minutes later, Republicans say that a reform coalition is being developed in Albany. Smith’s office argues that the vote was illegal and control did not shift parties.

June 9: The Espada-led coalition is refused the keys to the Senate Chamber.

June 10: Monserrate says he needs more time to recruit more Democrats. Meanwhile, Golisano claims to be entirely unaware of Monserrate’s legal problems.

June 11: Gov. David Paterson says, “The dysfunction and chaos in the Senate has wasted an entire week of the people’s business.” Again, Monserrate says he needs more time to recruit more Democrats to his reform majority.

June 12: State Supreme Court Justice Thomas McNamara is charged with deciding whether or not the Senate leadership vote was legal. He pushes sides to settle differences.

June 13: The reform coalition forces its way into the Senate Chamber. However, the bill jackets are not available, so no official legislation can be passed. Monserrate leaves early, stressing he will not participate until more Democrats are part of the coalition.

June 14: The New York Post learns that Monserrate had “solicited a donation to his legal defense fund from a lobbyist pushing for changes to a bill sponsored by the embattled Queens senator.”

June 15: Monserrate returns to the Democratic conference, after a weekend of articles anticipating the move. The Democrats soothe a cranky press corps with Blow Pops, as the conference prepares for an early afternoon press conference. Smith announces that Sen. John Sampson has been elected the new conference leader, while Smith, likely to avoid negating the Democrats own lawsuit, retains the contested title of majority leader. The conference announces that it will hammer out power-sharing agreements with the Republican later in the day. These negotiations fail.

June 16: McNamara dismisses the Democrats’ lawsuit, stating that it doesn’t fall under the court’s purview and urges the Senate to settle its own dispute. Espada, along with his 30 Republican allies, tries to hold session, but fails due to lack of quorum, as none of the Democratic conference shows up.

June 17: Stalemate continues in the Senate. Bronx District Attorney Robert Johnson interviews Espada’s housekeeper in connection to his investigation into the legislator’s residence.

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