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Dean Skelos, Albany Senate Leader, Aided Son at All Costs, U.S. Says
Over the last five years or so, it seemed there was little that Dean G. Skelos, the majority leader of the New York Senate, would not do for his son.
He pressed a powerful real estate executive to provide commissions to his son, a 32-year-old title insurance salesman, according to a federal criminal complaint. He helped get him a job at an environmental company and employed his influence to help the company get government work. He used his office to push natural gas drilling regulations that would have increased his son’s commissions.
He even tried to direct part of a $5.4 billion state budget windfall to fund government contracts that the company was seeking. And when the company was close to securing a storm-water contract from Nassau County, the senator, through an intermediary, pressured the company to pay his son more — or risk having the senator subvert the bid.
The criminal complaint, unsealed on Monday, lays out corruption charges against Senator Skelos and his son, Adam B. Skelos, the latest scandal to seize Albany, and potentially alter its power structure.
The repeated and diverse efforts by Senator Skelos, a Long Island Republican, to use what prosecutors said was his political influence to find work, or at least income, for his son could send both men to federal prison. If they are convicted of all six charges against them, they face up to 20 years in prison for each of four of the six counts and up to 10 years for the remaining two.
Senator Kenneth P. LaValle, of Long Island, who serves as chairman of the Republican conference, emerged from a closed-door meeting Monday night to say that conference members agreed that Mr. Skelos should be benefited the “presumption of innocence,” and would stay in his leadership role.
“The leader has indicated he would like to remain as leader,” said Mr. LaValle, “and he has the support of the conference.” The case against Mr. Skelos and his son grew out of a broader inquiry into political corruption by the United States attorney for the Southern District of New York, Preet Bharara, that has already changed the face of the state capital. It is based in part, according to the six-count complaint, on conversations secretly recorded by one of two cooperating witnesses, and wiretaps on the cellphones of the senator and his son. Those recordings revealed that both men were concerned about electronic surveillance, and illustrated the son’s unsuccessful efforts to thwart it.
Adam Skelos took to using a “burner” phone, the complaint says, and told his father he wanted them to speak through a FaceTime video call in an apparent effort to avoid detection. They also used coded language at times.
At one point, Adam Skelos was recorded telling a Senate staff member of his frustration in not being able to speak openly to his father on the phone, noting that he could not “just send smoke signals or a little pigeon” carrying a message.
The 43-page complaint, sworn out by Paul M. Takla, a special agent for the Federal Bureau of Investigation, outlines a five-year scheme to “monetize” the senator’s official position; it also lays bare the extent to which a father sought to use his position to help his son.
The charges accuse the two men of extorting payments through a real estate developer, Glenwood Management, based on Long Island, and the environmental company, AbTech Industries, in Scottsdale, Ariz., with the expectation that the money paid to Adam Skelos — nearly $220,000 in total — would influence his father’s actions.
Glenwood, one of the state’s most prolific campaign donors, had ties to AbTech through investments in the environmental firm’s parent company by Glenwood’s founding family and a senior executive.
The accusations in the complaint portray Senator Skelos as a man who, when it came to his son, was not shy about twisting arms, even in situations that might give other arm-twisters pause.
Seeking to help his son, Senator Skelos turned to the executive at Glenwood, which develops rental apartments in New York City and has much at stake when it comes to real estate legislation in Albany. The senator urged him to direct business to his son, who sold title insurance.
After much prodding, the executive, Charles C. Dorego, engineered a $20,000 payment to Adam Skelos from a title insurance company even though he did no work for the money. But far more lucrative was a consultant position that Mr. Dorego arranged for Adam Skelos at AbTech, which seeks government contracts to treat storm water. (Mr. Dorego is not identified by name in the complaint, but referred to only as CW-1, for Cooperating Witness 1.)
Senator Skelos appeared to take an active interest in his son’s new line of work. Adam Skelos sent him several drafts of his consulting agreement with AbTech, the complaint says, as well as the final deal that was struck.
“Mazel tov,” his father replied.
Senator Skelos sent relevant news articles to his son, including one about a sewage leak near Albany. When AbTech wanted to seek government contracts after Hurricane Sandy, the senator got on a conference call with his son and an AbTech executive, Bjornulf White, and offered advice. (Like Mr. Dorego, Mr. White is not named in the complaint, but referred to as CW-2.)
The assistance paid off: With the senator’s help, AbTech secured a contract worth up to $12 million from Nassau County, a big break for a struggling small business.
But the money was slow to materialize. The senator expressed impatience with county officials.
Adam Skelos, in a phone call with Mr. White in late December, suggested that his father would seek to punish the county. “I tell you this, the state is not going to do a [expletive] thing for the county,” he said.
Three days later, Senator Skelos pressed his case with the Nassau County executive, Edward P. Mangano, a fellow Republican. “Somebody feels like they’re just getting jerked around the last two years,” the senator said, referring to his son in what the complaint described as “coded language.”
The next day, the senator pursued the matter, as he and Mr. Mangano attended a wake for a slain New York City police officer. Senator Skelos then reassured his son, who called him while he was still at the wake. “All claims that are in will be taken care of,” the senator said.
AbTech’s fortunes appeared to weigh on his son. At one point in January, Adam Skelos told his father that if the company did not succeed, he would “lose the ability to pay for things.”
Making matters worse, in recent months, Senator Skelos and his son appeared to grow wary about who was watching them. In addition to making calls on the burner phone, Adam Skelos said he used the FaceTime video calling “because that doesn’t show up on the phone bill,” as he told Mr. White.
In late February, Adam Skelos arranged a pair of meetings between Mr. White and state senators; AbTech needed to win state legislation that would allow its contract to move beyond its initial stages. But Senator Skelos deemed the plan too risky and caused one of the meetings to be canceled.
In another recorded call, Adam Skelos, promising to be “very, very vague” on the phone, urged his father to allow the meeting. The senator offered a warning. “Right now we are in dangerous times, Adam,” he told him.
A month later, in another phone call that was recorded by the authorities, Adam Skelos complained that his father could not give him “real advice” about AbTech while the two men were speaking over the telephone.
“You can’t talk normally,” he told his father, “because it’s like [expletive] Preet Bharara is listening to every [expletive] phone call. It’s just [expletive] frustrating.”
“It is,” his father agreed.
Edward Chambers, Early Leader in Community Organizing, Dies at 85
A lapsed seminarian, Mr. Chambers succeeded Saul Alinsky as leader of the social justice umbrella group Industrial Areas Foundation.
Hard but Hopeful Home to âLot of Freddiesâ
Todd Heisler/The New York Times
Children playing last week in Sandtown-Winchester, the Baltimore neighborhood where Freddie Gray was raised. One young resident called it “a tough community.”
But an unusual assortment of players, including furniture makers, the Chinese government, Republicans from states with a large base of furniture manufacturing and even some Democrats who championed early regulatory efforts, have questioned the E.P.A. proposal. The sustained opposition has held sway, as the agency is now preparing to ease key testing requirements before it releases the landmark federal health standard.
The E.P.A.’s five-year effort to adopt this rule offers another example of how industry opposition can delay and hamper attempts by the federal government to issue regulations, even to control substances known to be harmful to human health.
Formaldehyde is a known carcinogen that can also cause respiratory ailments like asthma, but the potential of long-term exposure to cause cancers like myeloid leukemia is less well understood.
The E.P.A.’s decision would be the first time that the federal government has regulated formaldehyde inside most American homes.
“The stakes are high for public health,” said Tom Neltner, senior adviser for regulatory affairs at the National Center for Healthy Housing, who has closely monitored the debate over the rules. “What we can’t have here is an outcome that fails to confront the health threat we all know exists.”
The proposal would not ban formaldehyde — commonly used as an ingredient in wood glue in furniture and flooring — but it would impose rules that prevent dangerous levels of the chemical’s vapors from those products, and would set testing standards to ensure that products sold in the United States comply with those limits. The debate has sharpened in the face of growing concern about the safety of formaldehyde-treated flooring imported from Asia, especially China.
What is certain is that a lot of money is at stake: American companies sell billions of dollars’ worth of wood products each year that contain formaldehyde, and some argue that the proposed regulation would impose unfair costs and restrictions.
Determined to block the agency’s rule as proposed, these industry players have turned to the White House, members of Congress and top E.P.A. officials, pressing them to roll back the testing requirements in particular, calling them redundant and too expensive.
“There are potentially over a million manufacturing jobs that will be impacted if the proposed rule is finalized without changes,” wrote Bill Perdue, the chief lobbyist at the American Home Furnishings Alliance, a leading critic of the testing requirements in the proposed regulation, in one letter to the E.P.A.
Industry opposition helped create an odd alignment of forces working to thwart the rule. The White House moved to strike out key aspects of the proposal. Subsequent appeals for more changes were voiced by players as varied as Senator Barbara Boxer, Democrat of California, and Senator Roger Wicker, Republican of Mississippi, as well as furniture industry lobbyists.
Hurricane Katrina in 2005 helped ignite the public debate over formaldehyde, after the deadly storm destroyed or damaged hundreds of thousands of homes along the Gulf of Mexico, forcing families into temporary trailers provided by the Federal Emergency Management Agency.
The displaced storm victims quickly began reporting respiratory problems, burning eyes and other issues, and tests then confirmed high levels of formaldehyde fumes leaking into the air inside the trailers, which in many cases had been hastily constructed.
Public health advocates petitioned the E.P.A. to issue limits on formaldehyde in building materials and furniture used in homes, given that limits already existed for exposure in workplaces. But three years after the storm, only California had issued such limits.
Industry groups like the American Chemistry Council have repeatedly challenged the science linking formaldehyde to cancer, a position championed by David Vitter, the Republican senator from Louisiana, who is a major recipient of chemical industry campaign contributions, and whom environmental groups have mockingly nicknamed “Senator Formaldehyde.”
By 2010, public health advocates and some industry groups secured bipartisan support in Congress for legislation that ordered the E.P.A. to issue federal rules that largely mirrored California’s restrictions. At the time, concerns were rising over the growing number of lower-priced furniture imports from Asia that might include contaminated products, while also hurting sales of American-made products.
Maneuvering began almost immediately after the E.P.A. prepared draft rules to formally enact the new standards.
White House records show at least five meetings in mid-2012 with industry executives — kitchen cabinet makers, chemical manufacturers, furniture trade associations and their lobbyists, like Brock R. Landry, of the Venable law firm. These parties, along with Senator Vitter’s office, appealed to top administration officials, asking them to intervene to roll back the E.P.A. proposal.
The White House Office of Management and Budget, which reviews major federal regulations before they are adopted, apparently agreed. After the White House review, the E.P.A. “redlined” many of the estimates of the monetary benefits that would be gained by reductions in related health ailments, like asthma and fertility issues, documents reviewed by The New York Times show.
As a result, the estimated benefit of the proposed rule dropped to $48 million a year, from as much as $278 million a year. The much-reduced amount deeply weakened the agency’s justification for the sometimes costly new testing that would be required under the new rules, a federal official involved in the effort said.
“It’s a redlining blood bath,” said Lisa Heinzerling, a Georgetown University Law School professor and a former E.P.A. official, using the Washington phrase to describe when language is stricken from a proposed rule. “Almost the entire discussion of these potential benefits was excised.”
“That’s a huge difference,” said Luke Bolar, a spokesman for Mr. Vitter, of the reduced estimated financial benefits, saying the change was “clearly highlighting more mismanagement” at the E.P.A.
The review’s outcome galvanized opponents in the furniture industry. They then targeted a provision that mandated new testing of laminated wood, a cheaper alternative to hardwood. (The California standard on which the law was based did not require such testing.)
But E.P.A. scientists had concluded that these laminate products — millions of which are sold annually in the United States — posed a particular risk. They said that when thin layers of wood, also known as laminate or veneer, are added to furniture or flooring in the final stages of manufacturing, the resulting product can generate dangerous levels of fumes from often-used formaldehyde-based glues.
Industry executives, outraged by what they considered an unnecessary and financially burdensome level of testing, turned every lever within reach to get the requirement removed. It would be particularly onerous, they argued, for small manufacturers that would have to repeatedly interrupt their work to do expensive new testing. The E.P.A. estimated that the expanded requirements for laminate products would cost the furniture industry tens of millions of dollars annually, while the industry said that the proposed rule over all would cost its 7,000 American manufacturing facilities over $200 million each year.
“A lot of people don’t seem to appreciate what a lot of these requirements do to a small operation,” said Dick Titus, executive vice president of the Kitchen Cabinet Manufacturers Association, whose members are predominantly small businesses. “A 10-person shop, for example, just really isn’t equipped to handle that type of thing.”
Big industry players also weighed in. Executives from companies including La-Z-Boy, Hooker Furniture and Ashley Furniture all flew to Washington for a series of meetings with the offices of lawmakers including House Speaker John Boehner, Republican of Ohio, and about a dozen other lawmakers, asking several of them to sign a letter prepared by the industry to press the E.P.A. to back down, according to an industry report describing the lobbying visit.
The industry lobbyists also held their own meeting at E.P.A. headquarters, and they urged Jim Jones, who oversaw the rule-making process as the assistant administrator for the agency’s Office of Chemical Safety and Pollution Prevention, to visit a North Carolina furniture manufacturing plant. According to the trade group, Mr. Jones told them that the visit had “helped the agency shift its thinking” about the rules and how laminated products should be treated.
The resistance was particularly intense from lawmakers like Mr. Wicker of Mississippi, whose state is home to major manufacturing plants owned by Ashley Furniture Industries, the world’s largest furniture maker, and who is one of the biggest recipients in Congress of donations from the industry’s trade association. Asked if the political support played a role, a spokesman for Mr. Wicker replied: “Thousands of Mississippians depend on the furniture manufacturing industry for their livelihoods. Senator Wicker is committed to defending all Mississippians from government overreach.”
Individual companies like Ikea also intervened, as did the Chinese government, which claimed that the new rule would create a “great barrier” to the import of Chinese products because of higher costs.
Perhaps the most surprising objection came from Senator Boxer, of California, a longtime environmental advocate, whose office questioned why the E.P.A.’s rule went further than her home state’s in seeking testing on laminated products. “We did not advocate an outcome, other than safety,” her office said in a statement about why the senator raised concerns. “We said ‘Take a look to see if you have it right.’ ”
Safety advocates say that tighter restrictions — like the ones Ms. Boxer and Mr. Wicker, along with Representative Doris Matsui, a California Democrat, have questioned — are necessary, particularly for products coming from China, where items as varied as toys and Christmas lights have been found to violate American safety standards.
While Mr. Neltner, the environmental advocate who has been most involved in the review process, has been open to compromise, he has pressed the E.P.A. not to back down entirely, and to maintain a requirement that laminators verify that their products are safe.
An episode of CBS’s “60 Minutes” in March brought attention to the issue when it accused Lumber Liquidators, the discount flooring retailer, of selling laminate products with dangerous levels of formaldehyde. The company has disputed the show’s findings and test methods, maintaining that its products are safe.
“People think that just because Congress passed the legislation five years ago, the problem has been fixed,” said Becky Gillette, who then lived in coastal Mississippi, in the area hit by Hurricane Katrina, and was among the first to notice a pattern of complaints from people living in the trailers. “Real people’s faces and names come up in front of me when I think of the thousands of people who could get sick if this rule is not done right.”
An aide to Ms. Matsui rejected any suggestion that she was bending to industry pressure.
“From the beginning the public health has been our No. 1 concern,” said Kyle J. Victor, an aide to Ms. Matsui.
But further changes to the rule are likely, agency officials concede, as they say they are searching for a way to reduce the cost of complying with any final rule while maintaining public health goals. The question is just how radically the agency will revamp the testing requirement for laminated products — if it keeps it at all.
“It’s not a secret to anybody that is the most challenging issue,” said Mr. Jones, the E.P.A. official overseeing the process, adding that the health consequences from formaldehyde are real. “We have to reduce those exposures so that people can live healthy lives and not have to worry about being in their homes.”
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