Why is the Mandel Administration hiding any and all information about the City's newly formed Local Development Corporation (LDC) as well as the "family and friends" of the political clubhouse who appear to have been appointed to positions on that board, and who may be getting paid with taxpayer money? What's the big secret?
Today, the Long Beach City website today posted a picture of a new business in the city. The picture included, according to the caption, "Deputy Director of Economic Development Warren Vegh", another Democrat Clubhouse crony and insider.
Vegh's appointment to the position of Director of Economic Development may be more than another hiring of a political crony and hack to a city position at the taxpayer's expense. If Vegh has been appointed, and it appears from the picture he has, he would be the 25th family and friend hired, promoted, or given a taxpayer funded contract or award to, since the Mandel Administration promised not to hire a single family or friend to a city position during the 2011 campaign.
When did Vegh, become the Deputy Director of Economic Development? Is this a new city position? Or is this position related to the City's recently formed and apparently secret Local Development Corporation (LDC)? Is it a paid position? Who else serves with Vegh on the LDC?
We know that sometime in the past few months, the city appointed the LB Democrat Clubhouse's highest paid employee, Stuart Osnow, to the position of Secretary of LDC, at least according to Osnow's LinkedIn account.
Here's the big question: Why hasn't the city announced the formation of the LDC, if it has in fact been formed, which it appears it has? In their first month in office the Mandel Administration hired Harris Beach Law Firm (connected to Tom Suozzi) to form the Long Beach LDC. The firm was awarded a contract for $20,000 of taxpayer money to form the LDC but the city refuses to release any information whatsoever about the Long Beach LDC, its by laws, corporation papers, members, and meetings. It appears to be a big secret. The city has never announced who is on the LDC, if they get paid, how much, or when and/or where they LDC would meet.
I made a Freedom of Information Law (FOIL) request about the details of secret LDC entity but like most of my FOIL's the city completely ignored it and the city manager ignored my appeals, a clear violation of the Open Government Law.
What is the big secret?
Didn't this administration promise "transparency" in city hall?
Local Development Corporations are very suspicious entities. In fact, the NY State Attorney General Schneiderman has said the these LDC's "have the potential for self-dealing, nepotism, improper loans and exorbitant expenses." Regarding LDC's, the New York State Comptroller Tom DiNapoli said, "Local governments are supposed to use LDCs for economic development purposes. But we found that isn't always the case. Time after time, our auditors uncovered LDCs being used to skirt the laws governing local government operations. And that's costing taxpayers money." According to DiNapoli, LDC's are subject to state law, which require them to be "transparent" especially when it comes to their fiscal transactions and budgets. However, a report concludes that more than half of the LDC's in NY failed to file the proper reports and financial disclosures required by law!! LDCs are obviously a vehicle that have been used and exploited for inappropriate activities. So why does Long Beach need one? And why is it being kept a secret?
A recent New York Attorney General's review of local development corporations (LDC's) has uncovered the potential for self-dealing, nepotism, improper loans and exorbitant expenses.
The uncovering Vegh's new position begs a number of important questions. Is Vegh's position a newly created city hall position or is the position on the Long Beach LDC, like Osnow's? If he was appointed to a new position on the LDC or with the city, who made the appointment and when? If the position is on the LDC who else was appointed to it, by who, and when? Is the City making the appointments behind closed doors, and if so why? Also, do the members of the LDC get any salary or compensation or benefits, like most LDC directors and employees get? And if yes, how much and who funds those salaries?
Local Development Corporations are widely known for their lack of transparency and their use in promoting political cronyism and have been under the review of both the State Attorney General and the State Comptroller.
According to Comptroller DiNapoli, Local Development Corporations have been plagued with transparency issues. In addition, LDC's have actually cost taxpayers more money because LDC's have been used to avoid state finance laws. This may explain exactly why Mandel and his colleagues want to fill secretly the Long Beach LDC with political operatives, cronies, family members and friends, like Osnow and Vegh. Could it be possible that the Mandel Administration is purposefully using the LDC as the vehicle to reward their political friends under the guise of a legitimate and supposedly "helpful", benevolent and worthwhile non-for-profit LDC?
If the Mandel Administration put as much effort into what really matters to our city, such as the recovery, out of control spending, outrageous borrowing, and skyrocketing TAXES as they do for promoting, hiring, and rewarding their political friends and family members, the city would be much better off.
Until the city releases the specifics about this secret Local Development Corporation (LDC) and its members the residents of the city will be kept in the dark while Mandel and his colleagues in the city waste more of our taxpayer money finding positions for and rewarding their clubhouse family and friends.
