** It’s bad enough that we have unaccountable agencies and boards with the power to disburse millions of dollars in corporate welfare. It is even more problematic for our legal and governmental systems when elected officials appoint to these entities political cronies with histories of poor judgment and ethical lapses. **

It came as a bit of a shock to read the front page article in the October 12, 2015 Buffalo News by political reporter Robert J. McCarthy. Beneath the headline, “Maziarz cleared background check amid investigation – Sources say federal prosecutor is backing off former state senator,” McCarthy reports that the state senate confirmed the appointment last January of former state senator George D. Maziarz “to an obscure hydropower panel” – the New York State Economic Development Power Allocation Board (EDPAB). That action was preceded, according to the article, by “the required State Police background check.”

The newsworthy aspect of the October 12, 2015 story escapes me. The Maziarz appointment was announced ten months ago during the agency’s December 15, 2014 board meeting. At best, the Buffalo News article leaves a reader uncertain whether the former senator’s appointment to the state panel has had any impact on an investigation begun last year by U.S. Attorney Preet Bharara into then-senator’s use of campaign funds. At worst, the headline and front-page report seems to imply that the former senator’s “successful background check” has removed him from legal scrutiny.

Regardless of its purpose, the October 12^th article motivated me to investigate the current makeup of EDPAB, and led me to the discovery that Sam Hoyt – who serves as President of Empire State Development’s Western Region, and vice-chair of the Peace Bridge Authority – is also chairman of EDPAB. Further digging also led to uncovering the following: In 2012, NY’s legislature created an even more-obscure hydropower panel, the Western New York Power Proceeds Allocation Board.

The announcement last year that George Maziarz would retire as of December 31, 2014 did not sadden me. In fact, I have made it clear ever since I observed his behavior in 2010-2011 – regarding the proposed Verizon Wireless data center in the Niagara County Town of Somerset – that I do not have a very high opinion of the former state senator [and, I’m pretty certain that the feeling is mutual]. For example:

– The former senator’s banal cheerleading and failure to critically assess the telecommunication giant’s project and intentions, as well as his unflinching support for an estimated $626 million package of “financial aid” for Verizon from NYPA and the Niagara County IDA in exchange for – at best – 200 jobs, reflected poor and misguided judgment.

– His refusal to ask whether a better location in more urban portions of Niagara County (such as abandoned brownfield sites), coupled with his receipt of sizeable campaign contributions in 2008–2010 from the owner of the Somerset parcel, and in 2010 from Verizon, raised questions concerning the manner in which his official actions were impacted by political contributions.

– Public vilification by Mr. Maziarz of my client, a 75-year-old widow who owned farmland across the road from the proposed site, for asserting her rights under New York’s zoning and environmental review laws, demonstrated both a mean-spiritedness and a misunderstanding and disdain for the rights of average citizens and property owners. His false and public accusation – archived in a March 21, 2011 video clip for “The New York State Legislative Report” – that I had sought out my client and used her as a “pawn” in furtherance of an unidentified party’s interests, shows a reckless and dangerous disregard of the truth unacceptable in a public servant. [In fact, when my client’s daughter contacted me in a panic two days prior to a public hearing before the Somerset town board, and asked me if I could attend the hearing on her mother’s behalf, I embarrassingly told her that I had no idea where the Town of Somerset was located.]

My writings here and in various op-ed pieces also reflect the fact that I do not think highly of Sam Hoyt, for (among other things) his role in spearheading Gov. Andrew Cuomo’s policy of deception and abuse of power at the Peace Bridge. Neither George Maziarz, nor Sam Hoyt, would clear my background check for any government position that requires sound judgment and impeccable ethical credentials.

So the thought of Hoyt and Maziarz comprising two of four members of the EDPAB board is downright disconcerting. In theory, the power allocation board’s primary role is to serve as a “watchdog” on behalf of the public, ensuring that the New York Power Authority (NYPA) uses its financial clout within the requirements and criteria prescribed by law. Sadly, that “dog” has refused to bare its teeth, much less bite.

More specifically, it is my opinion that EDPAB exhibited a willingness in 2010 to disregard both the law and ethics when it rubberstamped a request for $105 million to fund development at Buffalo’s Canalside. What follows is a detailed summary of what occurred in February 2010 – taken from an unanswered email that I sent in September 2010 to then-editor of the Buffalo News, Margaret M. Sullivan:

     In need of additional funding for the Canal Side project, the project sponsors, Empire State Development Corporation [ESDC] and its local subsidiary, ECHDC, asked NYPA to provide an “Industrial Incentive Award” [IIA] of $3.7 million per year for 20 years to help finance the project. There were two basic problems with ESDC/ECHDC’s request. Pursuant to NYPA’s annual Economic Development Plan, IIAs were only available to industrial companies in NYS “at identifiable risk of closure or relocation to another state.” The Canal Side project, and its long-pursued “destination retailer,” Bass Pro, obviously did not fit that criteria. Additionally, NYPA’s annual Economic Development Plans had never included a 20-year funding proposal. Despite these defects, NYPA asked its oversight agency, EDPAB, to approve the proposed funding package for the Canal Side project.

     On February 2, 2010, EDPAB held a special meeting, by video conference, for the sole purpose of considering NYPA’s funding proposal for the Canal Side project. The EDPAB Chairman, Kenneth Schoetz, participated in the video conference from the 95 Perry Street office suite of ECHDC and his employer, ESDC, the agency that had requested the Industrial Incentive Award for the waterfront project. Mr. Schoetz, who had previously served as ESDC’s Acting Upstate Chairman, held the position of ESDC’s “Senior Vice President of Regional Offices” on February 2, 2010. Despite the fact that the proposal under consideration represented a radical departure from prior EDPAB policies, requiring EDPAB to revise the then-current Economic Development Plan to extend it from 2016 to 2029, and to add a new “permissible use” to the list of uses of Industrial Incentive Awards, Chairman Schoetz chose not to recuse himself from participating in the discussion and voting on the proposal. In fact, he provided the third and decisive vote required by statute to approve the resolution.

     Plaintiffs in Goldman, et al. v. Bass Pro Outdoor World, L.L.C., et al. (NYS Supreme Court, Erie Co., Index No. 7723/2010), contend that Mr. Schoetz’s dual role, as EDPAB Chairman and ESDC’s Senior Vice President, created a disqualifying conflict of interest, or, at a minimum, the appearance of impropriety. Responding to that claim, Mr. Schoetz has provided a sworn affidavit to the Court in which he denies any impropriety and states:

 There is no conflict of interest nor even the appearance of impropriety here. It is common for public bodies with similar missions to have cross involvement… The purpose of having an ESD employee serve on EDPAB is to promote cooperation and consistency in economic development decisions. [Emphasis added.]

The so-called “cross involvement” touted by then-Chairman Schoetz, and the “cooperation and consistency” that he says it promotes, help to explain the often narrow, myopic perspective of agencies such as NYPA and Empire State Development (and its subsidiaries, such as Erie Canal Harbor Development Corporation). Such inbreeding also helps to accelerate the public’s loss of confidence in the integrity and wisdom of the economic development process.

Given their past history, Sam Hoyt and George Maziarz are not likely to make decisions in their capacity as EDPAB board members that will help restore the public’s faith in government decision-makers – unless, perhaps, U.S. Attorney Preet Bharara is available to babysit.

With All Due Respect,

Art Giacalone