The city Economic Development Corp. and the local development corporation run by former Borough President Claire Shulman admitted they illegally lobbied city officials about the multibillion-dollar Willets Point Redevelopment project, the attorney general announced Tuesday.
The EDC will be restructuring as a result.
State Attorney General Eric Schneiderman said the Flushing Willets Point Corona Local Development Corp., run by Shulman, and the EDC broke the law when they tried to influence city legislators to support the project in 2008.
“These local development corporations flouted the law by lobbying elected officials, both directly and through third parties, to win approval of their favored projects. As a result of today’s agreement, these organizations will reform their practices to comply with the law and end lobbying through proxies in the communities they serve,” Schneiderman said in a statement.
The EDC is now currently in charge of overseeing the $3 billion Willets Point project and released a statement in response to Schneiderman’s report.
“The New York City Economic Development Corporation intends to undertake a restructuring, the primary effect of which will be to allow the company to remain a not-for-profit corporation, but to cease to be a local development corporation,” it said in a statement. “This restructuring should be seamless from the perspective of third-parties and should have little to no impact on the day-to-day operations of the company. It will, however, enable the company to operate freely and legally in areas that are necessary and appropriate for it to achieve its economic development mission.”
Under the agreement, both the EDC and Shulman admitted to their lobbying efforts and promised the state they would not to do it again.
The agreement also requires ranking members of the groups to take compliance training and requires the EDC to disclose any funding provided to other LDCs or personnel overlap with other LDCs, according to the AG.
Many in the Willets Point community thought the agreement was a slap on the wrist for Shulman, but the attorney general might not have had the power to do anything further.
Shulman could not be reached for comment.
The law in question is a state statue that stipulates “no such corporation shall attempt to influence legislation by propaganda or otherwise.”
But breaking it is not tied to any penal code that would declare it a misdemeanor or felony, for example, leaving the AG with little prosecutorial options about this specific statue.
Reach reporter Joe Anuta by e-mail at [email protected] or by phone at 718-260-4566.