A Louisiana engineering firm formed at the same time that Nassau sought new bids to secure federal superstorm Sandy aid has signed $16 million in county contracts since its chief executive started donating often to County Executive Edward Mangano’s campaign and committees backing him, records show.
Since late 2013, Daniel Gerrity and three businesses he helps run have made $13,050 in political contributions to Mangano and the GOP club led by his chief deputy, Rob Walker.
On the same day that the county finalized one of the pacts with his company, Gerrity also gave $4,000 to the political action committee of the vendor managing Nassau’s sewer system. That same week, the PAC made a $10,000 contribution to Mangano.
Gerrity and his companies had never previously given to a Nassau County candidate or political club, state election board records show.
The donations started shortly before Gerrity left his job as a regional manager at CDM Smith, the company that previously handled Nassau’s efforts to get federal reimbursement for Sandy rebuilding. Gerrity soon incorporated a new firm, CG-3PL Engineering, which in 2014 received county contracts worth $24,990 and $4 million.
A $12 million extension of the larger agreement — awarded by the Mangano administration last fall and approved by county lawmakers in December — was rejected Jan. 19 by County Comptroller George Maragos, who called it “unnecessary.” The administration has spent recent weeks meeting with Maragos over the rejection, and now may rebid the work.
Aides to Mangano, a Republican, said CG-3PL, while not the low bidder for the original $4 million pact, was the best qualified. Both they and Gerrity said campaign contributions didn’t impact contracts.
“You can’t put contributions and contracts in the same sentence,” said Gerrity, chief executive of CG-3PL, noting his 25 years of experience working in storm recovery across the nation, and his experience in the county before forming his company. “It’s just not fair.”
Mangano spokesman Brian Nevin said, “the county executive does not take part in the solicitation of campaign contributions,” and “did not solicit nor negotiate the contract” with CG-3PL Engineering.
Legal, public scrutiny
Campaign finance experts said awarding municipal contracts to large political donors, particularly in proximity to their giving, can lead taxpayers to distrust the process.
“Even if there is no quid pro quo arrangement, just the mere appearance of someone handing over cash and then receiving a lucrative contract is damaging to the integrity of the public’s confidence in government,” said Craig Holman, government affairs lobbyist for Public Citizen, a Washington, D.C. nonprofit that focuses on ethics and campaign finance issues.
Hana Callaghan, director of government ethics at Santa Clara University’s Markkula Center for Applied Ethics, said that absent specific anti-“pay to play” legislation, which limits vendors’ political contributions, “courts have generally not found it to be improper for public contractors to contribute to political campaigns.
“However, public servants are stewards of the public trust, and as such have an ethical duty to avoid even the appearance of impropriety,” Callaghan said.
The intersection of campaign contributions and the awarding of county contracts has come under heightened scrutiny in recent months.
Federal prosecutors are investigating a contract with VIP Splash Waterways Recovery Group, which incorporated two days before Nassau first sought bids for the Sandy waterway debris removal work it would be awarded. On the day in 2014 that its $12 million agreement was signed by Walker, the chief deputy county executive, VIP Splash made a $2,925 donation to Walker’s Hicksville Republican club.
Newsday also reported last year that Nassau since 2011 has awarded hundreds of specialty contracts for amounts just below the $25,000 threshold requiring legislative approval. Many went to politically connected firms without competitive bidding.
Mangano, responding to the reports and investigations, has tried to address some of the issues, but has stopped short of what some have called for: limiting or banning vendors’ ability to make political contributions.
Under county legislation passed in December, vendors and top executives will have to disclose those contributions to county officials when bidding on county contracts. The contribution information already is available on a state website.
On Jan. 6, the Nassau Interim Finance Authority, the state board that controls county finances, passed its own new rules requiring the county to disclose to the board winning bidders’ contributions to officials and local political clubs, and the date the company was incorporated.
But Holman, who helped draft anti-“pay to play” laws in New Jersey, Connecticut and Illinois, said “disclosure is not enough. There are so many ways to hide campaign contributions.”
Path to contracts
Immediately after Sandy, which struck in October 2012, Gerrity worked for Nassau as a regional manager for Boston-based CDM Smith, an international engineering and consulting firm. CDM Smith, through its Woodbury office, had a $5.3 million emergency contract to first help the county navigate federal reimbursement requirements for storm recovery projects.
By September 2013, the CDM Smith contract was nearing expiration. That month, 3PL Consulting, a Louisiana company where Gerrity serves as vice president, donated $2,500 to Mangano’s campaign.
Gerrity left CDM Smith in November 2013, and incorporated both 3PL and CG-3PL with New York State in January 2014. That month, Nassau’s public works department sought bids for a new contract — worth $4 million — to handle long-term Sandy reimbursement.
The vendor would be responsible for navigating complex and often-changing federal requirements to secure hundreds of millions of dollars the county needed to rebuild after the storm. Eleven firms, including CG-3PL, bid on the new contract. Three of them — Nelson and Pope, D & B and Universal Management Solutions, engineering companies that all have received county contracts — also had given thousands of dollars each to Mangano’s campaign in past years, records show.
On Feb. 24, 2014, as Nassau’s public works department was evaluating the bids, the county awarded a no-bid $24,990 contract to CG-3PL for Sandy reimbursement work. Mary Studdert, a public works spokeswoman, said the contract was necessary because Nassau’s contract approval process is lengthy “and services were needed immediately.”
Gerrity gave $2,000 to Mangano’s campaign on Feb. 27, according to state records.
Public works officials awarded CG-3PL the $4 million contract in May. Three companies proposed lower bids, but the county said CG-3PL, with Gerrity and others who had worked on the CDM Smith contract, had the most experience with federal reimbursement requirements.
In June, BCG Engineering, another Louisiana firm where Gerrity is CEO, gave $2,000 to Mangano’s campaign.
The County Legislature’s GOP-controlled Rules Committee, the final legislative stop for contract approvals, unanimously approved CG-3PL’s agreement in September 2014 with no debate.
The Mangano administration, through Walker’s signature, executed the $4 million pact with CG-3PL on Nov. 14, 2014.
That day, according to state records, Gerrity gave $4,000 to the New York State political action committee of United Water, the private company that recently had received a 20-year, $1 billion contract to manage Nassau’s sprawling sewage treatment system.
Mangano’s campaign recorded receiving a $10,000 donation from United Water on Nov. 20, 2014, records show.
United Water, now known as Suez, said there was no connection between Gerrity’s donation to the PAC and its donation to Mangano.
“The company holds fundraisers for its PAC to continue to bring together people who all have the same environmental goals,” said Suez spokesman Mike Martino, formerly an aide to Mangano. “The company will always support elected officials who share our environmental mission.”
Gerrity gave Mangano’s campaign another $2,500 on Dec. 2, 2014, state records show.
Asked to explain his political giving, Gerrity said he enjoys playing golf and many Mangano fundraisers are golf events. Overlap between donations and milestones in the contract process were “complete coincidence,” he said.
Studdert, the public works spokeswoman, said CG-3PL’s “success can be judged on the high level of reimbursements received by the county from the federal government.” She credited CG-3PL with securing more than $200 million in federal aid for Nassau projects.
“I’ve been involved in seven or eight different storm events around the country and the county has done things faster than anybody I’ve ever seen,” Gerrity added of Nassau.
Last year, Gerrity gave Mangano’s campaign $400 in March and $600 in July, and CG-3PL gave Walker’s Hicksville Republican Committee $2,000 on Sept. 9, earning a sponsorship at its annual golf fundraiser. The company also gave Hicksville $750 on Sept. 23, state election records show.
The day before, Gerrity signed a contract extension that was to pay CG-3PL $12 million more through 2018. In October, Gerrity gave Mangano’s campaign another $300.
In December, the legislature’s Rules Committee, without discussion, approved the $12 million amendment to CG-3PL’s contract. Officials said it was not rebid because the firm had developed unique systems to manage federal storm reimbursement efforts.
Maragos rejected the amendment on Jan. 19, before it could be executed by Mangano’s office. In explaining the decision, Maragos spokesman Jostyn Hernandez said the two-year extension “was deemed unnecessary.
“The original contract provides for an additional year of service at no cost to the taxpayers,” he said of CG-3PL’s $4 million pact, which has already been fully paid.