Frederick Ippolito, the Town of Oyster Bay Commissioner of Planning and Development, admitted Tuesday that he avoided paying federal income taxes on $2 million he earned, and agreed to repay what he owed.
Appearing before U.S. District Judge Leonard Wexler in U.S. District Court in Central Islip, Ippolito, 77, of Syosset, pleaded guilty to one count of income tax evasion, a felony. A plea agreement calls for Ippolito to serve 18 to 24 months in prison under sentencing guidelines.
Prosecutors initially charged Ippolito with six counts of income-tax evasion for concealing the $2 million in income between 2008 and 2013.
As part of the plea, Ippolito will have to repay the taxes, which Eastern District federal prosecutors Catherine Mirabile and Raymond Tierney calculated at $548,000. But they said the final amount will be up to Wexler.
Each of the six initial counts could have called for up to five years in prison.
When asked in court what he was pleading to, Ippolito said: “In 2008, I received income that I failed to report on my income tax report.” The indictment said he reported no income in 2008 and said he owed no taxes for that year.
Ippolito, who appeared very subdued, walked up to the judge using a cane with the wheelchair he also uses nearby.
When Wexler asked Ippolito how he was pleading, Ippolito initially said, “Not guilty,” but hastily changed that to “Guilty, I’m sorry.”
After court, Ippolito’s attorney, Brian Griffin, of Garden City, said: “By accepting responsibility for the underpayment of taxes, Mr. Ippolito has agreed to put this chapter behind him and move forward. It is important to note that this plea is in no way connected to Mr. Ippolito’s role as a public official, nor does it impact his years of dedication and service to the public.”
Mirabile and Tierney declined to comment.
Ippolito, a longtime influential town official and Republican political figure in Oyster Bay, had been indicted in March 2015 on six counts of failing to report $2 million in consulting fees he had received from Carlo Lizza & Sons Paving, an Old Bethpage road paving firm where he had been employed until joining the town in 2009, as well as from the Lizza Family Trust.
The money was paid by an unidentified member of the Lizza company, who was not charged in the case, according to an investigation by the Criminal Division of the Internal Revenue Service.
The Lizza company has received tens of millions of dollars in contracts from Oyster Bay Town, Nassau County, and New York State, and is a large-scale contributor to both Republican and Democratic candidates, but more heavily to Republicans, according to records. Neither the company nor the trust was charged with wrongdoing.
Robert Freier, who responded to a request for comment from officials of the Town Democratic Party and who unsuccessfully ran for a seat on the town board, said, “What happened today is not surprising. . . . The Town and the building department have been running . . . under a cloud of corruption for many years.”
An attorney for Lizza, John Carman of Garden City, declined to comment in the case.
Ippolito also has been a longtime vice chairman of the Nassau Republican party. A spokesman for the party, Michael Watt, declined to comment.
The Ippolito case, along with the case of restaurateur Harendra Singh, has caused intense turmoil in Oyster Bay politics.
Singh, who has pleaded not guilty and is awaiting trial, has been charged with bribing a town deputy attorney to get what amounted to a town guarantee behind a multimillion-dollar bond issue for improvements to the town food concessions he had operated.
As commissioner since 2009, Ippolito is “responsible for the enforcement of all codes, rules and ordinances” involving buildings and zoning in the town, as well as issuing permits for construction, according to court documents.
Ippolito also had outside businesses as president of CAI Associates Ltd., a consulting and snow-removal firm, and he and his late wife operated a now-closed restaurant, Christiano’s in Syosset. The indictment said that not only did Ippolito fail to report the $2 million on his personal tax returns, but also on the returns of any of his private enterprises. Ippolito sold Christiano’s in 2013 to Singh, who closed it the next year.
Supervisor John Venditto and the town’s representatives did not return repeated calls for comment on the plea or Ippolito’s job status.
But two members of the all-Republican Oyster Bay Town Board called on Ippolito to step down immediately.
“He is guilty and it’s time to resign,” said Councilman Anthony Macagnone. Macagnone said the Planning and Development Department needs oversight.
“We have to put an independent inspector general in to restore confidence,” Macagnone said. He added that he would propose an inspector to look into the department. “People should have faith in who’s running the township,” Macagnone said.
Councilman Joseph Pinto also said Ippolito must resign.
“I don’t think he should be serving if he pleaded guilty,” Pinto said.
— With Ted Phillips