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This Week in New York State Government

Governor:

Governor Cuomo Announces $20 Million Available to Build Affordable Housing in Areas Damaged by Superstorm Sandy, Hurricane Irene and Tropical Storm Lee

Governor Andrew M. Cuomo announced $20 million is available for the construction of new affordable housing units damaged by Superstorm Sandy, Hurricane Irene or Tropical Storm Lee.

Qualified housing developers are invited to submit proposals for properties to be developed in the following eligible counties: Albany, Broome, Chemung, Chenango, Clinton, Columbia, Delaware, Dutchess, Essex, Franklin, Fulton, Greene, Hamilton, Herkimer, Montgomery, Nassau, Oneida, Orange, Otsego, Putnam, Rensselaer, Rockland, Saratoga, Schenectady, Schoharie, Suffolk, Sullivan, Tioga, Tompkins, Ulster, Warren, Washing and Westchester.

Funding will come from the Governor’s Office of Storm Recovery, out of its $4.4 billion federal allotment from the U.S. Department of Housing and Urban Development’s Community Development Block Grant-Disaster Recovery Program, and overseen through the Homes and Community Renewal’s Small Project Affordable Rental Construction program. The funding will be administered by the Community Preservation Corporation, a leading not-for-profit affordable housing and neighborhood revitalization organization. The Community Preservation Corporation will oversee the development of approximately 150 to 200 rental units, with at least 51 percent of new units at each property to be designated for local residents earning below 80 percent of the area median income. The program will target small properties, with eight to 20 units each in low-density areas that may not be normally reached by housing programs. Eligible projects could also include the adaptive reuse or substantial rehabilitation of vacant buildings.

Within the 33 eligible counties, there will be focus on regions that include the State’s NY Rising Community Preservation Corporation areas (http://www.stormrecovery.ny.gov/) that have developed plans to address storm recovery and resilience. Applicants must qualify for both Community Preservation Corporation construction financing and Homes and Community Renewal Small Project Affordable Rental Construction program funds. For consideration in Round 1, proposals must be received by November 2, 2015, and for consideration in Round 2, proposals must be received by December 31, 2015. The Community Preservation Corporation will inform all respondents of their status on or before January 8, 2016. The program is expected to be phased-in over a 24-month period.

Governor Cuomo Announces Anheuser-Busch to Retain 443 Jobs in Central New York

Governor Andrew M. Cuomo announced that Anheuser-Busch InBev, one of the world’s leading brewers and a top-five consumer products company, will invest $62 million in its Baldwinsville facility to allow craft beer production and upgrade machinery and equipment and retain 443 jobs at the Baldwinsville location. With U.S. origins dating back to the 1860’s, Anheuser-Busch operates 12 flagship breweries across the U.S. and boasts a portfolio of more than 200 beer brands, including the country’s most popular beer, Bud Light. In the United States, AB holds greater than 46 percent market share of beer sales.

AB’s Baldwinsville brewery produces more than 65 brands, is 1.5 million square feet in size, and can ship 180 trucks a day. Baldwinsville has traditionally been on the leading edge of innovation and creativity, and this investment helps them continue to innovate. Since 2011, tens of millions have been invested in the Baldwinsville brewery to add new capabilities, increase efficiencies and sustain existing operations. To encourage Anheuser-Busch to invest and remain in its facilities in upstate New York, Empire State Development, New York’s chief economic development agency, has offered the company $2 million in performance-based Excelsior Jobs Program Tax Credits.

Governor Cuomo Creates New Fellowship and Scholarship Programs to Honor the Life and Achievements of Carey Gabay

Governor Cuomo announced the creation of the “Carey Gabay Fellowship” and the “Carey Gabay Scholarship” to honor his life and work. Gabay, a former assistant counsel in the Governor’s Office and First Deputy Counsel to Empire State Development, passed on September 15, 2015, nine days after he was struck by a stray bullet.

The Carey Gabay Fellowship will be awarded every two years to a mid-career attorney who, like Gabay, is committed to public service, hails from an economically disadvantaged background, and most importantly, embodies the integrity and kind-heartedness that distinguished Gabay personally. The Fellow will serve for two years in the Governor’s Counsel’s office, where Gabay began his career in this administration, and will work on furthering the Governor’s violence prevention initiatives as well as issues of economic equality and development that Gabay championed throughout his career. The fellow will be assigned a mentor in Counsel’s office and the first fellow will lead a major research project on violence prevention in memory of Gabay. Opportunities for the fellow to earn an MPA concurrently with state service will be explored. Fellowship attorney applications to be accepted starting January 4, 2016 and will require a personal statement, three references, a writing sample and impressive academic and professional credentials. The Gabay Fellow will update the Gabay family periodically as to his or her work and experience.

The Carey Gabay Scholarship Program will award, annually, full-ride scholarships to five deserving students to attend the State University of New York. These scholarships will cover all costs of attendance, including tuition, room and board, college fees, books and supplies, and transportation and personal expenses. Many grants and scholarships only cover the cost of tuition, requiring students and families to dip into savings or take out student loans to cover these other necessary college expenses. The Carey Gabay full-ride scholarships will truly cover all college costs, allowing the recipients to focus fully on their coursework, and – like Gabay – to go on to make a difference in their chosen field.

The Carey Gabay Scholarship will be available to students at all four-year SUNY colleges, and will be awarded annually beginning in the 2016-17 academic year. These scholarships will be targeted at students from disadvantaged backgrounds who have demonstrated academic excellence, leadership and mentoring skills, and a commitment to social justice, along with other application criteria to be developed in coordination with Carey’s family. Applications will be accepted beginning January 11, 2016, and awards will be selected based on an application package including an essay and letters of recommendation from teachers and community members.

Governor Cuomo Announces $6 Million in Funding to 43North

Governor Andrew M. Cuomo announced that 43North, the world’s largest business-idea competition, will receive $6 million to continue its operation through 2016. The 43North initiative is designed to attract entrepreneurial talent to Western New York and showcase the assets Buffalo can offer to promising startups.

The New York Power Authority Board of Trustees approved the 43North award at their meeting. The funding was one of several awards the trustees approved following recommendations made by the Western New York Power Proceeds Allocation Board. Those awards are made possible from net earnings from the sale of unused hydropower from NYPA’s Niagara power plant and stems from legislation signed into law by Governor Cuomo in 2012.

To be eligible for Western New York Power Proceeds Allocation Board awards, enterprises must be located within a 30-mile radius of NYPA’s Niagara power plant and the projects must support the growth of business and lead to the creation or protection of jobs. The allocation board also considers the extent to which an award would be consistent with the strategies and priorities of the area’s regional economic development council.

Contracts with awardees will include provisions for periodic audits to ensure the funds are used for agreed-upon purposes.
Including the latest awards, 33 enterprises have received nearly $30 million in funding since 2013. Through the end of September, NYPA has provided more than $41 million to the proceeds fund.

Governor Cuomo Announces $3 Million in Funding for Prostate Cancer Research

Governor Andrew M. Cuomo announced $3 million in prostate cancer research funding has been awarded to 20 research institutions across the state to explore new and innovative concepts in prostate cancer detection, diagnosis and treatment. Prostate cancer remains the second most common cancer among men in New York State. Each awardee will now conduct their own procedure for determining which of its potential research projects will be funded. During the application process, institutions were required to demonstrate their institution’s commitment to prostate cancer research, their ability to implement research and provide a description of their process selecting which research projects would be funded. Some described multi-level peer review of research proposals by experts in the field, others described competitive application and review processes.

These awards not only aim to build upon New York State’s history as the home to many important discoveries relating to the prevention and treatment of cancer, but also help enable these institutions to establish a foundation of research that can open up future funding opportunities from entities such as the National Institutes of Health or the Department of Defense.

The following institutions will receive between $450,000 and $75,000 for up to two years:

$450,000 during a two-year period:

  • Health Research, Inc. on behalf of Roswell Park Cancer Institute
  • Sloan Kettering Institute for Cancer Research
  • The Trustees of Columbia University in the City of New York

$300,000 during a two-year period:

  • Cold Spring Harbor Laboratory
  • Yeshiva University on behalf of Albert Einstein College of Medicine
  • New York University School of Medicine

$75,000 for a 15-month period:

  • The Research Foundation for State University of New York (SUNY) College at Old Westbury
  • The Research Foundation of City University of New York on behalf of Hunter College
  • University of Rochester
  • Narrows Institute for Biomedical Research and Education, Inc., on behalf of the Veterans Administration of New York, Harbor Healthcare System
  • Weill Medical College of Cornell University
  • The Research Foundation for SUNY at Binghamton University
  • Albany Research Institute, Inc. on behalf of Stratton Veterans Administration Medical Center
  • Hauptman-Woodward Medical Research Institute
  • Riverside Research Institute
  • The Research Foundation for SUNY on behalf of the University at Albany
  • The Research Foundation for SUNY Upstate Medical University
  • The Research Foundation of CUNY on behalf of the City College of New York
  • The Research Foundation for SUNY on behalf of SUNY Downstate Medical Center
  • Fordham University

Prostate cancer is second only to skin cancer as the most common cancer among men in New York. An estimated 1 in 6 men will develop prostate cancer during his lifetime. The disease occurs mostly in men aged 65 and older. Men diagnosed with prostate cancer who are uninsured may be eligible for treatment through the New York State Medicaid Cancer Treatment Program. For more information visit: http://www.health.ny.gov/diseases/cancer/treatment/mctp/.

Governor Cuomo Announces Launch of Common Core Task Force

Governor Andrew M. Cuomo launched the Common Core Task Force – a diverse and highly-qualified group of education officials, teachers, parents, and state representatives from across New York that is charged with comprehensively reviewing and making recommendations to overhaul the current Common Core system and the way we test our students. The Task Force will complete its review and deliver its final recommendations by the end of this year. The Task Force will include members of the Governor’s successful New NY Education Reform Commission, which played an instrumental role in developing a blueprint to improve the quality of education for all students through its final report in January 2014. Richard Parsons, who chaired that Commission, will return to lead the Governor’s Common Core Task Force. Mr. Parsons is Senior Advisor, Providence Equity Partners Inc. and former Chairman of the Board, Citigroup Inc.

Governor Cuomo believes that the learning standards should be strong, accurate and fair, because having the highest standards is critical to ensuring that students are educated and prepared for their futures in college or the workforce. However, the Common Core program’s flawed rollout by the State Education Department has caused disruption and anxiety that must be fixed, including testing aligned to the standards.

With that in mind, the Governor has charged the Task Force to:

  • Review and reform the Common Core State Standards;
  • Review New York State’s curriculum guidance and resources;
  • Develop a process to ensure tests fit curricula and standards;
  • Examine the impact of the current moratorium on recording Common Core test scores on student records, and make a recommendation as to whether it should be extended;
  • Examine how the State and local districts can reduce both the quantity and duration of student tests, and develop a plan whereby districts include parents in reviewing local tests being administered to analyze those tests’ purpose and usefulness; and
  • Review the quality of the tests to ensure competence and professionalism from the private company creating and supplying the tests.

The Governor has directed the Task Force to conduct its process as transparently as possible and to solicit and consider input from regional advisory councils comprised of parents, teachers and educators across the state. A new website (ny.gov/CommonCoreTaskForce) has been launched to encourage participation, including by allowing visitors to submit comments and recommendations to the Task Force. The Task Force’s report will be issued publicly by the end of the year so that it can be reviewed by all and changes can be implemented quickly and effectively.

Governor Cuomo Announces Over 8,100 Dangerous Drivers Kept off the Road

Governor Andrew M. Cuomo announced that 8,132 dangerous drivers have been kept off the road during the last three years as result of tough regulations implemented by the Governor in 2012. The measures deny licenses to repeat offenders that continually drive under the influence of alcohol or drugs, or persistently drive recklessly.

Since the measures went into effect three years ago, the Department of Motor Vehicles has permanently denied licenses to:

  • 1,792 people for accumulating five or more alcohol or drug-related driving convictions in their lifetime.
  • 2,515 people for having three or four alcohol or drug-related driving convictions in the last 25 years, plus at least one other serious driving offense during that period. A serious driving offense includes a fatal crash; a driving related penal law conviction; and an accumulation of 20 or more points worth of driving violations within the last 25 years, or having two or more driving convictions worth five points or higher.

In addition, DMV has denied licenses to:

  • 3,825 drivers for an additional five years after revocation due to three or four alcohol or drug-related convictions but no serious driving offense in the last 25 years. Once reinstated after that five-year period, these individuals will receive a problem driver A-2 restricted license. This type of license is limited to driving to or from work or medical visits, among certain other limitations, and most often requires drivers to use an ignition interlock on their vehicle for five years.

These statistics were as of Friday, September 25, the three-year anniversary of the implementation of these regulations.
In addition to day-to-day enforcement actions conducted throughout the state by law enforcement entities, the Governor’s Traffic Safety Committee coordinates targeted enforcement actions to combat impaired driving, including the Labor Day “Drive Sober or Get Pulled Over” campaign. Over the course of this nearly three-week campaign, New York State Police arrested 769 individuals for driving while intoxicated. During this crackdown, State Police and local law enforcement agencies targeted not only drunk or impaired motorists, but also drivers who were speeding, not wearing seatbelts, not abiding by the “move over” law and texting while driving.

Additionally, Governor Cuomo has made combating texting-while-driving a high priority, increasing the number of points for a texting-while-driving infraction from two points to three points in 2011, and from three points to five points in 2015. Thus far in 2015, state and local law enforcement agencies have issued 58,408 tickets for texting while driving across New York and 232,637 tickets since the original texting while driving law went into effect in November 2009. State and local law enforcement agencies have also issued 96,366 tickets for cell phone use while driving in 2015 and 3,213,900 since the law took effect in 2001.

Governor Cuomo Announces $350,000 in Funding Available to Increase Use of Locally Grown Foods in Schools

Governor Andrew M. Cuomo announced a new funding opportunity for school districts across New York State aimed at connecting them to local growers and producers to increase the use of locally grown specialty crops. Through the Farm to School program, $350,000 in grants is now available for projects that will help Pre-K through Grade 12 schools procure and serve healthy, locally grown foods on school menus. The Farm to School program is aimed at developing and strengthening connections between farms and schools to help grow the agricultural economy and increase the amount and variety of specialty crops procured by schools for healthier meal options. New York State produces a wide range of specialty crops, such as fruits and vegetables, dried fruits, herbs and spices, which rank highly in the nation in terms of both production and economic value.

Applicants for the program can include Pre-K through 12 school food authorities, charter schools, not-for-profit schools, and other entities participating in the National School Lunch or Breakfast Programs and/or operating Summer Food Service Programs.

Projects eligible for grant funding across New York’s school districts may include:

  • Employing of a local or regional farm to school coordinator.
  • Training programs for food service staff to increase knowledge of local procurement and preparation of locally produced specialty crops.
  • Purchase of equipment needed to increase capacity of school kitchen and food service staff to prepare and serve locally produced specialty crops.
  • Capital improvements to support the transport and/or storage of locally produced specialty crops.

The Farm to School program was first announced as a result of Governor Cuomo’s Capital for a Day in Rochester, which he created to bring state government directly to the people it serves. The day-long event partnered state officials with residents, local leaders and stakeholders to examine first-hand the needs of a community and how New York State government can build upon its strengths and make a positive impact on its residents.

The commissioners from the State Departments of Agriculture and Markets, Health and the Office of General Services joined leaders from the New York Apple Association, Farm Fresh First, Empire Potato Growers and New York State Vegetable Growers Association, Brockport School District and the New York City School Support Services, to discuss increasing the procurement of New York State food products in New York’s more than 700 schools. The discussion centered on the growers’ delivery system and the school districts’ needs and purchasing process, and how to make it easier to bring the two together.

Governor Cuomo Signs Legislation to Increase Penalties against Forcible Touching on Public Transportation

Governor Andrew M. Cuomo announced that he has signed legislation to increase penalties for forcible touching on New York mass transit systems, making such offenses punishable by up to a year behind bars.

“New York has zero tolerance for predators who seek to use crowded buses, subways and trains to commit depraved crimes of opportunity,” Governor Cuomo said. “Those who commit these despicable acts will be caught and, with this new law, will face very real consequences.”

The legislation (S.3203-A / A.4969-B) covers all New York State-operated bus, train and subway systems. This Class A misdemeanor, punishable by up to a year in jail and a $1,000 fine, will cover a broad variety of sexual misconduct, which often happen during rush hour when a victim cannot escape a crowded vessel. These offenses could previously only be charged under a Class B misdemeanor.

Comptroller:

Comptroller DiNapoli: Medicaid Costs for Diabetes Reach $1.2 Billion

Approximately 460,000 New York Medicaid recipients diagnosed with diabetes received diabetes-related services costing more than $1.2 billion in state fiscal year (SFY) 2013-14, according to a report released by State Comptroller Thomas P. DiNapoli detailing the statewide costs of the disease.

“Millions of New Yorkers suffer from diabetes and the numbers are growing. It is a costly disease to fight given its chronic nature and the severity of its complications,” DiNapoli said. “Preventing diabetes is difficult not only in New York but across the country. The state Department of Health (DOH) deserves credit for openly acknowledging the ongoing challenge of diabetes prevention and the need for more progress in meeting this major health issue. Clearly, the battle against diabetes must continue to be a priority.”

DiNapoli’s report, “Diabetes in New York State,” notes that about 1.6 million adult New Yorkers, or 10.3 percent of the adult population, have been diagnosed with either Type 1 or Type 2 diabetes, according to the federal government. This compares to the three-year nationwide average of 9.6 percent.

Type 2, or adult-onset diabetes, accounts for 90 to 95 percent of all diagnosed cases in New York, according to the report. DOH estimates that another 760,000 New Yorkers have the disease but do not know it. DOH also estimates that 5 million New Yorkers have pre-diabetes, which is marked by higher-than-normal blood-sugar levels and indicates an elevated risk of developing diabetes, early heart disease and stroke.

Over the five-year period ending in March 2014, annual diabetes-related expenditures for Medicaid recipients grew by $293.7 million, or 31 percent (13.8 percent, adjusted for medical care cost inflation), to $1.2 billion. Over the same time period, total New York Medicaid spending increased $9.4 billion, or 21 percent (4.7 percent, adjusted for inflation), to $54.9 billion in SFY 2013-14.

Comptroller DiNapoli Releases Bond Calendar for Fourth Quarter

New York State Comptroller Thomas P. DiNapoli announced a tentative schedule for the planned sale of obligations for the state, New York City, and their major public authorities during the fourth quarter of 2015.

The proposed new issuances total approximately $5.68 billion, including $2.97 billion scheduled for this month, $1.41 billion scheduled for November and $1.3 billion for December. The anticipated fourth quarter issuances compare to past planned new issuances of approximately $1.65 billion during the third quarter of 2015 and $6.71 billion during the fourth quarter of 2014. The State Comptroller’s office chairs the Securities Coordinating Committee which was created by Gubernatorial Executive Order primarily to coordinate the borrowing activities of the State, New York City and their respective public authorities. All borrowings are scheduled at the request of the issuer and done pursuant to its borrowing programs.

The fourth quarter new money borrowings are expected to include the following:

  • Dormitory Authority of the State of New York – a bond sale of $1 billion in tax-exempt fixed rate bonds for the month of October and a bond sale of $200 million in tax-exempt fixed rate bonds for November.
  • Empire State Development – a bond sale of $1.3 billion in tax-exempt and taxable fixed rate bonds for December.
  • Long Island Power Authority – a bond sale of $100 million in tax-exempt variable rate bonds for October.
  • Metropolitan Transportation Authority – a note sale of $700 million in tax-exempt fixed rate notes for November.
  • New York City Municipal Water Finance Authority – a bond sale of $250 million in tax-exempt variable rate bonds for October and a bond sale of $350 million in tax-exempt fixed rate bonds for November.
  • New York City Transitional Finance Authority – a bond sale of $400 million in tax-exempt and/or taxable, fixed and/or variable rate bonds for October.
  • New York City Housing Development Corporation – a bond sale of $130 million in tax-exempt fixed rate bonds for October.
  • New York State Energy Research and Development Authority – a bond sale of $50 million in taxable fixed rate bonds for October.
  • New York State Housing Finance Authority – bond sales totaling $204 million in tax-exempt and taxable variable rate as well as tax-exempt fixed rate bonds for October and bond sales totaling $163 million in tax-exempt and taxable variable rate bonds for November.
  • Port Authority of New York & New Jersey – a bond sale of $700 million in taxable fixed rate bonds for October.
  • State of New York Mortgage Agency – a bond sale of $140 million in taxexempt, taxable fixed rate bonds for October.

Refundings or reofferings are currently being contemplated by: the Long Island Power Authority, the Metropolitan Transportation Authority, the Nassau County Interim Finance Authority, the New York City Transitional Finance Authority, the New York Power Authority, the Port Authority of New York & New Jersey, the Triborough Bridge & Tunnel Authority and the Utility Debt Securitization Authority.

The schedule will be modified and updated in response to changes in program needs and market conditions. It is also contingent upon execution of all project approvals required by law. The schedule is released by the Committee to assist participants in the municipal bond market. A new schedule is released every quarter and updated as necessary. The collection and release of this information by the Office of the State Comptroller is not intended as an endorsement of the proposed issuances it contains, many of which will be subject to approval by the Office of the State Comptroller.

The full forward calendar can be obtained at: www.osc.state.ny.us/pension/scccalendar.pdf.

Comptroller DiNapoli: MTA Faces $9.8 Billion Capital Plan Shortfall

Whether the Metropolitan Transportation Authority (MTA) will be able to limit future fare and toll increases to 4 percent as planned will depend on the amount of capital funding made available by New York state and New York City, and whether the economy continues to grow without interruption as anticipated by the MTA, according to a report released by New York State Comptroller Thomas P. DiNapoli. While the short-term outlook for the MTA’s operating budget has improved with the economy, its 2015-2019 capital program is facing a $9.8 billion funding gap. To close this gap, the MTA has suggested that New York state increase its contribution to the MTA’s capital program by $7.3 billion to a total of $8.3 billion and that New York City increase its contribution to $3.2 billion, $2.5 billion more than currently budgeted.

The Governor and the Mayor have acknowledged the importance of funding the MTA’s capital program, but the state and the city have not yet approved the MTA’s request for additional resources. As a result, it is not yet possible to assess the impact on the MTA’s finances, its fare and toll-paying customers, or the state and city budgets. Under the MTA’s funding proposal, the MTA would contribute $11.7 billion. More than two thirds of that funding ($8 billion) would come from additional borrowing. Debt service and other operating budget resources devoted to the MTA’s capital program would reach $3.5 billion by 2019, $1 billion more than in 2014. Even with planned biennial fare and toll increases of 4 percent, the capital program would account for 21 percent of operating revenues during the financial plan period, compared with 17 percent in 2014.

The MTA’s current four-year financial plan extends through calendar year 2019. While the MTA anticipates balanced operating budgets through 2017, it projects growing budget gaps of $175 million in 2018 and $224 million in 2019 despite its plans to raise fares and tolls by 4 percent in both 2017 and 2019. The MTA has not yet indicated how it intends to close these gaps in its operating budgets, and the potential exists for even larger gaps because the MTA is assuming the economy will continue to grow without interruption. Given the possibility of an economic setback during the financial plan period, DiNapoli’s report recommends that the MTA consider increasing its reserves, as the state and the city have done.

DiNapoli’s report also found that:

  • Subway ridership is on track to reach 1.77 billion riders in 2015, the most since 1949, and Metro-North ridership is expected to set a new record in 2015 with nearly 84 million riders. Long Island Railroad ridership remains lower than it was before the recession, despite gradual gains. Bridge and tunnel crossings have increased with job growth in New York City and lower gas prices, but crossings are not expected to approach prerecession levels until 2019;
  • The MTA’s revenues are very sensitive to changes in the economy. During the last recession, MTA tax revenues fell by $1.3 billion (36 percent) over a two-year period. In response, the MTA cut services and raised fares and tolls by 10 percent, and the state raised dedicated transit taxes by more than $1 billion. The MTA’s general reserve averages $155 million annually during the financial plan period, only 1 percent of expenditures;
  • The MTA’s cost-containment efforts since 2009 are expected to generate cumulative savings of $1.8 billion by 2019. Despite its efforts to keep costs down, spending is expected to total $15.1 billion in 2016, or 33 percent more than it did in 2010;
  • Overtime is on pace to set a new record of $759 million in 2015, $268 million more than in 2010;
  • Nondiscretionary costs, including debt service and fringe benefits, are projected to account for more than half (52 percent) of total revenue by 2019. Debt service alone would consume 18 percent of total revenue beginning in 2016;
  • The MTA raised fares and tolls by less than the inflation rate between 1996 and 2007, but since then it has raised fares and tolls by 33 percent, more than twice the inflation rate. The MTA has adopted a policy of biennial fare and toll increases, with projected increases of 4 percent in both 2017 and 2019. These increases are less than the projected inflation rate for these periods;
  • In the absence of new sources of capital funding to close the $9.8 billion funding gap, the MTA could be forced to cut the size of the capital program or borrow additional funds to finance its capital needs. Every additional $1 billion borrowed by the MTA would increase debt service by an amount comparable to a 1 percent increase in fares and tolls; and
  • Although still high by historical standards, subway car reliability (the average distance traveled between breakdowns) fell by 18 percent over the past three years. The MTA reports some improvement during the first seven months of 2015.

For a copy of DiNapoli’s report on the MTA’s financial outlook visit http://osc.state.ny.us/osdc/mta4-2016.pdf.

Speaker:

Speaker Heastie Announces the Appointment of Jane T. Feldman as Executive Director of New Office of Ethics and Compliance 

Upon taking office, Speaker Carl Heastie made a commitment to strengthen ethics and introduce greater transparency and accountability in the New York State Assembly. He announced the appointment of Jane T. Feldman as the executive director of the new Office of Ethics and Compliance. Ms. Feldman was recommended to the Speaker by a bi-partisan committee of Assembly members who conducted a nationwide search for candidates.

Ms. Feldman served as the first executive director of the Colorado Independent Ethics Commission. Most recently, founded Rocky Mountain Ethics Consulting with the goal of creating a more ethical culture in businesses and government agencies. Ms. Feldman co-founded Great Education Colorado and its sister organization, Colorado Protectors of Public Schools, bi-partisan organizations which advocated for increased funding for public schools. She also served as an assistant attorney general in the Colorado Department of Law. She began her career as an assistant district attorney in the New York County District Attorney’s Office.

Feldman was also an appointed member of the Denver Board of Ethics, a regular panelist at the annual conference of the Council on Government Ethics Laws and has written about the importance of the independence of ethics commissions.

She is a graduate of the Benjamin N. Cardozo School of Law at Yeshiva University and she earned a bachelor’s degree from Wesleyan University.

The search committee, which was convened earlier this year, is comprised of six members who have extensive experience in the practice of law and ethics: William B. Magnarelli, Michele R. Titus, Philip Ramos, Shelley Mayer, Todd D. Kaminsky and Janet L. Duprey.

Attorney General:

Attorney General Schneiderman Announces more than $11 Million in New Funding for Statewide Foreclosure Prevention and Relief Programs

Attorney General Eric T. Schneiderman announced $11.5 million in new funding for more than two dozen legal services organizations statewide to help prevent foreclosures, keep families in their homes, and rebuild communities hit hardest by the housing crash.

Awards will be granted to 28 legal services providers with proven track records of providing services to at-risk homeowners. The grants, which are now before the New York State Comptroller for review and final approval, are for one year with a possibility of a one-year renewal. The new round of funding brings the total foreclosure prevention investment by the Office of the Attorney General to more than $70 million.

The new round of funding will support the Homeowner Protection Program (HOPP), a network of nearly 90 housing counseling and legal services agencies that provide free, high-quality assistance to at-risk families across New York to help them avoid foreclosure. A report released this summer by the Attorney General’s office showed the program has already helped more than 50,000 New York families.  The Attorney General has committed $100 Million to support HOPP from the settlements that his office negotiated with the nation’s largest banks following the collapse of the housing market.

Attorney General Schneiderman Obtains Order Barring Snow Removal Service Owner From Operating any Business Requiring Customers to Pre-Pay; Issues Tips for Consumers to Avoid Getting Scammed

Attorney General Eric T. Schneiderman announced that a consent order and judgment has been obtained against Thomas J. Zackoski for taking thousands of dollars from consumers in five New York counties for seasonal snow removal services that he failed to provide in the 2014-2015 winter season. Mr. Zackoski purported to do business under various different names, including Zackoski’s Snow Removal Services, SR & LM Specialists, Cortland Lawn & Landscaping, Z’s Snow Removal Services, Z’s Plowing Services, Plowscapes and Ryder Plowscapes.

Most consumers contacted Mr. Zackoski after reading his postings on Craigslist.  Consumers made arrangements via email to personally meet him and sign a seasonal contract.  Mr. Zackoski’s contracts appeared to be very thorough; he claimed to have had 12 snowplows and trucks and 4 additional trucks with snowblowers and he promised to provide snow removal services up to 3 times a day, if necessary.  At least 51 consumers pre-paid Mr. Zackoski amounts ranging from $150-$400 for snow removal services they did not receive.

The Attorney General’s Office filed a lawsuit against Mr. Zackoski after numerous consumers filed complaints stating that nobody had shown up to plow their driveways. Consumers reported that Mr. Zackoski provided phony excuses, via text and email, explaining why he was unable to plow.

The Consent Order and Judgment prohibits Mr. Zackoski from owning or operating any business in NYS, including snow removal services, that requires receipt of advance payments from consumers, and requires that he pay restitution to victims, as well as civil penalties and costs totaling $4,000 to the State of New York. In addition to the Attorney General’s civil prosecution, Mr. Zackoski was criminally prosecuted by the District Attorneys in Onondaga, Tompkins, Monroe, Oneida and Oswego counties. Restitution was paid to a number of victims in connection with these cases.  Nineteen additional consumers received full refunds in connection with the Attorney General’s civil prosecution.

Attorney General Schneiderman and 32 Attorneys General Sound Alarm on Dangers Of E-Cigarettes, Urge Fda to Require Child-Resistant Packaging and Health Warnings on all Liquid Nicotine Sales

Attorney General Eric T. Schneiderman, together with the attorneys general of Illinois and Indiana, co-sponsored a letter to the Food and Drug Administration urging the FDA to take immediate action to stem the increasing incidence of liquid nicotine poisoning among children nationwide.  The letter urges the FDA to require appropriate warning labels on liquid nicotine, nicotine-containing e-liquids and novel tobacco products such as dissolvables, lotions, gels and drinks.  The AGs also urge the FDA adopt or establish standards for child-resistant packaging for liquid nicotine and novel tobacco products. The letter was signed by 33 state attorneys general.

“As more and more Americans – especially young people – take up e-cigarettes, it is more important than ever that the FDA ensures our children are protected from the dangers of liquid nicotine,” said Attorney General Schneiderman. “Child-resistant packaging and health warnings are an essential step to keeping these potentially lethal toxins out of the hands of our children. The FDA must step up and regulate the sale and packaging of these dangerous products before any more kids are harmed.”

According to the American Association of Poison Control Centers, in 2014, 3,783 exposures to liquid nicotine nationwide were reported to poison control centers, a sharp increase from previous years.  Half of those calls related to poisoning of children under the age of five.  In 2014, an eighteen-month-old toddler in upstate New York died from ingesting liquid nicotine.

Attorney General Schneiderman Announces 198 Count Conviction of Ring Leader in Massive Eastern Seaboard Unstamped Cigarette Trafficking Enterprise

Attorney General Eric T. Schneiderman announced the conviction of Basel Ramadan, the ring leader of a criminal enterprise that flooded New York City, Albany County and Schenectady County with more than a million cartons of untaxed cigarettes illegally imported from Virginia. Basel Ramadan, 44 of Maryland, was found guilty on 198 counts, including Enterprise Corruption, Money Laundering, and numerous tax crimes by Brooklyn Supreme Court Justice Dineen A. Riviezzo. The nearly 10-week bench trial, which included evidence from hundreds of wiretaps, yielded a verdict of guilty, and the defendant now faces up to 8 1/3 to 25 years on Enterprise Corruption alone, and faces up to 30 years in prison on call 198 counts combined. Besides criminal activity, sales of non-taxed cigarettes deprive the state of millions of dollars in lost cigarette tax revenues, hurt law-abiding small businesses and undercut public health measures designed to discourage smoking.

Through the use of electronic surveillance, physical surveillance and the review and analysis of financial records in conjunction with other investigative tools, the Attorney General’s investigation revealed that Basel Ramadan and his brother obtained cigarettes from a wholesaler, Cooper Booth Wholesale, Inc., in Virginia and stored them in a public storage facility in Delaware. Several times a week, an alleged co-conspirator, Adel Abuzahrieh of Brooklyn, drove with tens of thousands of dollars in cash from New York to Delaware where he gave the Ramadans the cash in exchange for cigarettes. Beyond the $55 million in purchases to cigarettes, the Ramadans have generated more than $10 million in profits from their illegal activities. Abuzahreih’s case is still awaiting trial.

Once the distributors took possession of the merchandise – approximately 20,000 cartons of cigarettes a week – they distributed it to the resellers, who in turn sold the untaxed cigarettes to a myriad of Arab markets and grocery stores in Brooklyn, Staten Island and New Jersey. During a 12-month joint investigation by the Attorney General’s Organized Crime Task Force and the NYPD leading up to the indictment, law enforcement seized more than 65,000 forged NYC/NYS cigarette tax stamps that were not yet affixed to packs of cigarettes, and nearly 20,000 cartons of untaxed cigarettes. The investigation uncovered $55 million in illegal cigarette sales and seized three handguns from Ramadan.

In addition to the Ramadans, the enterprise consisted of several New York-based cigarette distributors, several New York-based cigarette resellers and Abuzahrieh, who allegedly transported cash, sometimes over $100,000 per trip, and cigarettes between New York and Delaware. Ramadan was the leader of a 16 member criminal drug ring charged in May 2013 in a 244-count indictment with enterprise corruption, money laundering and related tax crimes. Six defendants have previously pleaded guilty, including Ramadan’s brother, Samir Ramadan. Samir Ramadan, 40, pleaded guilty to the top enterprise corruption charge in 2014, is serving a prison term of up to six years.

Further information about the enterprise corruption case is available here.

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