Conflict of Interest: Same Old Same Old at KLDC
“If I, taking care of everyone’s interests, also take care of my own, you can’t talk about a conflict of interest” — Silvio Berlusconi, Italian leader jailed for taking care of his own interests. Everyone else’s? Not so much.
March 14, 2021
Kingston, NY – As if building luxury housing and boutique hotels on the public dime isn’t enough, the fix is likely in for the transfer of a municipal parking lot to the developers of the Kingstonian.
Background: The Kingstonian is a proposed $55 million project consisting of 143 mostly market-rate apartments, boutique hotel, garage and retail space to be developed by Brad Jordan and Joseph Bonura and unidentified investors rumored to include an alderman. The project is funded by the taxpayer to the tune of 60.15% — or $33 million — through New York State grants and tax breaks, plus at least an extra $12 million thanks to the Opportunity Zone capital gains tax exemption. Profit is estimated at a minimum of $80 million if investors hold for ten years — not bad, considering their cash investment is $6 million. With its reliance on corporate welfare in the form of grants and tax breaks for crony investors who no doubt are millionaires many times over, this project epitomizes the myth of “trickle-down” economics and the reality of “privatization of profit and socialization of loss” that have jinxed the United States with the dubious distinction of being the most unequal society in the developed world.
One of the parcels that will comprise the development is a City-owned parking lot, and recently, Kingston’s Common Council voted to transfer the lot to the Kingston Local Development Corporation (KLDC). Why? The KLDC is empowered to transfer property to whomever it chooses, whereas the Common Council would have to hold a public bidding process, which might attract bidders who would run the price up so as to put the kibosh on a project that has deeply divided the community and led to loss of confidence in the integrity of local government. Next step: The KLDC meets Thursday and may vote on what to do with the parking lot. With a good chunk of several KLDC members’ income dependent on City Hall, the outcome is not in doubt.
Here is the lineup of who does business with whom at the Kingston Local Development Corporation, where recent resignations and replacements continue the pattern of “Just-In-Time” firings and policy changes embraced by City Hall, Ulster County and the IDA to push through this welfare-for-cronies project via strong-arm tactics of questionable legality.
RELATIONSHIP MAP
LEGEND
The broken circles are for two recently resigned members. The arrows define verifiable political and financial relationships. Brad Jordan has been on the KLDC since its formation in 1995, but he recently stepped down so that when he snags a city parking lot for his new development no one can cry conflict of interest. (Stop laughing. Stop laughing RIGHT NOW!) Rich Mathews resigned late last year. In late 2019, Jordan paid Mathews $1.25 million for the N. Front St. property that currently houses Morgan Stanley and is separated by one building from another city-owned parking lot. How long will it be before Jordan tries to buy the intervening parcel to build yet another luxury housing project courtesy of the taxpayer and Kingston’s schoolkids?
STEVE NOBLE
In an early indication of the mayor’s pliable probity, in 2016 he fired his Ethics Board and repealed the Ethics Law, replacing it with a watered-down version that substantially weakened conflict of interest clauses.
HAYES CLEMENT
With two careers that fit hand in glove, Clement has established himself as a political presence in the Kingston’s Democratic Party and one of the area’s most successful real estate agents.
He recently brokered Kingston’s priciest sale ever – the Cordts Mansion, at $2.35 million, to the owners of the neighboring glamping project at Hutton Brickyards. A former mayoral candidate, Clement sits on Kingston’s Historic Landmarks Preservation Commission (HLPC), chairs the Heritage Area Commission, is former treasurer of the Ulster County Democratic Committee, is a member of Kingstonian cheerleader KUBA, and now is a board member of the Ulster County’s Housing Development Corporation, whose mission is to create housing.
Named to HLPC just in time to smooth path for Kingstonian
Developers do not like to undergo environmental reviews of their proposed buildings, and the Kingstonian’s developers had floated threats to pull the project if they were required to do so. But the HLPC was authorized to vote for or against such a review, and on March 3, 2019, before Clement was appointed, it voted unanimously in favor and produced a letter to that effect. Yet barely two weeks later, on March 19, 2019, Noble told Kingston’s Democratic Committee that the developers wouldn’t have to undergo the review. To make good on his word, Noble fired two HLPC members who spearheaded the recommendation and replaced them with Kingstonian cheerleaders, one of whom was Hayes Clement. City Hall did its best to bury the first commission’s letter, unsuccessfully attempting to prevent its full reading at a public hearing, then conveniently neglecting to upload and archive the second page of the testimony, which contained the actual wording in favor of the review. Then, City Planning Director Suzanne Cahill nixed the reading of that letter at a Planning Board meeting, noting that the new HLPC with the newly-installed Clement was “still deliberating.” In short order, the new, yes-man HLPC produced a letter finding NO need for an environmental review.
Not the first time questions were raised
Clement was a bit player in a 2014 campaign finance scandal in which donors seeking to evade dollar limits sent several county Democratic committees large payments that were then funneled to Democratic candidates. Prosecutors declined to press charges but strongly condemned the ethics violations. For the big picture, see this and this and this. For a look at how Clement may have gotten tangled up, see here.
ANDI TURCO-LEVIN
Any real estate agent who breathes a molecule of doubt about this handover of cash and property is likely to incur the wrath of his or her colleagues in the real estate profession, which already benefits from lopsided representation in local government. “I cannot stress enough the importance and the impact that real estate has on our economy, and the role it plays in the stability of our neighborhoods, not to mention that it is the foundation towards building personal wealth,” Turco-Levin said on her podcast. Speaking of personal wealth, does anyone wonder how this member of the National Association of Realtors, former candidate for the Ulster County Legislature and former president of the Ulster County Board of Realtors will vote to help Jordan build his, even if it’s at the expense of the rest of Kingston?
GLENN FITZGERALD
Owner of two sign and art/photo franchises in the nearby Town of Ulster, Fitzgerald is father to a real estate agent.
BERNARD A. FEENEY
KLDC’s own guidelines call for diversification of its assets. With more than $3 million in cash, this would be prudent, given that only $250,000 is guaranteed in the event of bank failure. How often do banks fail? Not often, but they do, as many savers discovered during the financial crisis that began in 2007, as well as the Savings & Loan crisis that stretched from the 1980s into the 1990s.
But all the KLDC money is at Catskill Hudson, where BA Feeney is Branch Manager and Assistant Vice President at Catskill Hudson Bank. It wouldn’t be the first time the issue was raised.
PAUL CASCIARO
For years, the City of Kingston has administered at least some portions of its HMO through Reis Insurance, where Casciaro is CEO.
Given the roughly $15 million Kingston’s School District stands to lose, one bit of exquisite irony is Casciaro’s designation as CSRM, a credential that supposedly trained him to “better serve the needs of schools.” But as the Good Book tells us, no man can serve two masters, and with a big insurance policy at stake, it’s not hard to guess which one Casciaro will pick.
JOE McDOLE
McDole sits on the The Kingston Housing Authority, and in response to a request a spokesperson emailed that he receives $200 a month in his capacity as board member. But City Hall emailed that it would require 20 business days to reply to a FOIL request on payments made to McDole, as well as Casciaro, which is of course enough time for the KLDC to cast its vote without forcing City Hall to acknowledge the paid relationship. The scuttlebutt is that McDole’s painting company, J’s Painting, was paid for work for Parks and Rec, but the payment was made only after a City attorney intervened to insist on the payment, which was denied at first because the job was large enough that it should have been put out to bid.
JIM DEMOSTHENES
Brad Jordan’s neighbor on Burgevin Street – Kingston’s equivalent of the Park Ave. strip where the titans of finance reside — is Demosthenes, who stands to benefit from new customers at his Santa Fe restaurant. Doubtless many small businesses in Kingston would benefit from new customers, but it’s debatable whether they should be subsidized by tens of millions of taxpayer dollars handed over in a process that has been riddled with lies and conflict of interest.
Speaking of conflict of interest, the ties that bind the Kingstonian and Demosthenes run deeper than mere neighborliness. In late 2014, the Demosthenes family sold their Hillside Manor restaurant and banquet facility to new owners including — surprise, surprise — Joe Bonura.
MILES CRETTIEN
Crettien is part owner of Lunch Nightly, a new restaurant on Broadway. Although it wasn’t reported in the local press, at the Feb. 25 Common Council Finance Committee public hearing he said he feared the transfer would “obscure the vital process of civic engagement” and expressed “concern of the lack of understanding of this process by the general public and the lack of transparency on behalf of the City of Kingston.”
PATRICE COURTNEY-STRONG
One time candidate for Ulster County Executive and longtime proponent of alternative energy, Courtney-Strong was the other KLDC member to voice doubts about the transfer and the criteria used by the project proponents to determine that the existing parking lot was a burden to local government.
ALBERT TEETSEL
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