Many Levy fund donors tied to new jail

Contractors, their employees and trade unions working on the new $156-million, maximum-security jail in Yaphank contributed $924,746 to County Executive Steve Levy's $4.3-million campaign war chest.

A Newsday examination of hundreds of records, and dozens of interviews related to the jail -- the largest public works project in the county in 30 years -- has found these contributions were a windfall for Friends of Steve Levy. These records and interviews show:

Thirty-two contractors and subcontractors and at least 17 employees of firms involved with the project made contributions totaling $462,056 from 2004, when active planning for construction began, through 2010. The biggest donor is Rocco Trotta, the chairman and chief executive officer of LiRO Construction Management, a Syosset firm that in 2005 won a $5.1-million contract to supervise construction at the site.

Twenty-six unions and union political action committees whose members have worked on the jail project contributed $462,689 to the Friends of Steve Levy. The largest was Steamfitters Local 638, which contributed $77,250 from 2004 through last year.

There is a close relationship between county Department of Public Works officials and the contractors whose work on the jail they supervise. There were fundraising events hosted by contractors and attended by Department of Public Works and Levy administration officials. Some DPW officials also worked on their own fundraisers for Levy. At least three high-ranking DPW officials have left the department since 2003 and currently work for firms involved with the jail project.

The entire Friends of Steve Levy fund must be turned over to Suffolk County District Attorney Thomas Spota as part of an agreement with Levy announced two weeks ago that ended an investigation by Spota's Government Corruption Bureau. The money will be reimbursed to donors who request it; what isn't returned will be given to charities. The agreement between Spota and Levy also compelled Levy to forgo his bid for a third term as county executive.

While declining to discuss the specifics of his investigation, Spota said his probe "revealed serious issues with regard to fundraising and the manner in which it was conducted, including the use of public resources."

On Tuesday, County GOP chairman John J. LaValle said he would turn over to the district attorney's office a $100,000 campaign donation from Levy to the county party, made last month. In a statement, LaValle said it was "unfair of Mr. Levy to give such a contribution, knowing it would necessarily taint the party."

The Levy administration did the project under the authority of the Judicial Facilities Agency, a state entity. With the JFA, the administration was able, through state legislation, to get an exemption from the Wicks Law, which would have required separate bids for several major components of the project. It allows for a more pivotal role for the construction manager, such as selecting subcontractors and unions. Officials say the exemption was to save taxpayer money

Levy spokesman Mark Smith said all contracts on the jail project were subject to competitive bidding procedures. Newsday has gone to court seeking the release of jail documents, including documents related to the bidding process. Levy sponsored a resolution approved by the county legislature that assured the jobs would be all union under a Project Labor Agreement. Smith said they were required to use a PLA on the project.

The project is the subject of an audit by county Comptroller Joseph Sawicki. He said he opened the audit last December after receiving a letter from the Judicial Facilities Agency that said the Department of Public Works was refusing to release to Newsday public records related to the jail.

Sawicki, a fellow Republican whom Levy has characterized as a political rival, said he found the fact that Levy's campaign raised so much money from vendors and unions working on the jail "extremely disturbing." He added, "Auditing this project is a no-brainer. It's a big chunk of taxpayers' money, and I want to make sure it's being spent properly."

Levy declined requests to be interviewed. Newsday also reached out to unions and contractors involved in the project who gave to Friends of Steve Levy. Many declined to comment or did not return repeated phone calls.

Asked to comment on the contributions Friends of Steve Levy received from vendors working on the jail, Levy spokesman Dan Aug said: "It is sad that Newsday would write an article implying that it is somehow untoward to obtain contributions that are neither illegal nor unethical. Interestingly, the publication never raised these concerns when the county executive was a member of a different political party. The ultimate irony is that the administration fought vigorously against having to build this mandated jail, which ultimately is being brought in on time and under budget." State efforts to compel the county to build a new facility to alleviate overcrowding began before Levy took office in 2004 and continued afterward.

Administration officials said any contractors or subcontractors working on the job were picked based on the quality of their work, not on donations. Gil Anderson, the DPW commissioner, said campaign contributions had very little if any bearing on who gets county contracts.

Election officials say the donations to Friends of Steve Levy do not appear to exceed guidelines limiting individual giving up to $44,000 per election cycle for the county executive, and $5,000 per year by companies.

Contractors as contributors

Thirty-two contractors on the project and some of their top employees have contributed to the fund. Examples of the top contractor contributors include: Sidney B. Bowne & Son, $64,202; Rosemar Contracting, Inc., $37,656.49; and E.W. Howell, $33,970.

Among the largest individual donors is LiRO's chairman, Rocco Trotta. Trotta has personally contributed $66,345 to Friends of Steve Levy since 2004. His contributions increased after his firm won the contract. Trotta made 33 contributions to the fund from 2004 through 2010. Last year alone, he contributed $14,300 to Levy. He did not return repeated phone calls asking for comment.

LiRO was initially hired by the Department of Public Works to do a feasibility study on whether the project should be covered by a Project Labor Agreement, which sets work rules. Such agreements result in unions getting work on a project. That study recommended that the project be covered by a Project Labor Agreement.

LiRO was one of eight that responded to a request for qualifications / proposals to be the project's construction manager. A selection committee of five public works employees, including then-Commissioner Charles Bartha, cut the list to three.

LiRO's bid for the project, at $5.1 million, was the highest of the three -- $1.1 million and $1.9 million higher than the other two, records show. The two other bidders did not contribute to Levy. A bidders scoring sheet obtained by Newsday under the Freedom of Information Law doesn't provide a reason for why the highest bidder was selected.

Marcella Diaz, chief marketing officer for LiRO, said the company was awarded its jail contract based on its qualifications as a construction management firm.

"We were hired based on our technical qualifications," she said. "We were the highest ranked based on technical qualifications. It was a qualifications-based hire, not a low bid."

She said that donations by Trotta were his own personal contributions, not the company's. "It was a personal donation that came out of his personal bank account," she said.

Company officials couldn't be interviewed because their work for the county continues, she said. She added that LiRO has not been contacted by the district attorney's office nor asked to provide any information.

In an interview, Anderson said there was no favoritism in the LiRO selection. He said the award was given to the most qualified bidder, regardless of the amount of the bids.

"At the end of the day, it [contributions] has very little import, if any at all, in getting work with the county," he said. "We require such levels of service that if they [contractors] don't meet it they are not getting the job."

Sidney B. Bowne & Son, Llp, a Mineola architectural and engineering consulting firm, contributed $22,800 to Levy in 2006, the same year the Department of Public Works hired the firm to work on the jail. Outgoing public works Commissioner Bartha signed the contract; in September of 2006, he went to work for the company. From 2004 through 2010, the company made 38 contributions to the Levy campaign totaling $64,202.

Jon Siskind, marketing manager at Bowne, said, "I personally don't know anything about those donations."

Jeffrey Koch, a political science professor at the State University of New York-Geneseo, said the fact that jail vendors and unions contributed so heavily to Levy creates the appearance of a problem. In general, he said, "We would be much better served if politics could be taken out and it could be done on a purely professional basis," he said.

Levy has defended the practice of soliciting vendors by saying that, although he supports campaign finance reform, "you don't unilaterally disarm."

Monroe Freedman, a Hofstra law professor and ethics expert, disagreed. "The argument that everybody does it is simply not acceptable," he said.

One department's key role

The importance of Department of Public Works to a county executive can be seen in a taped conversation, made on March 26, 2004, between Levy, who had recently been elected county executive, and Stephen Baranello, one of his top advisers. The tape was made by Spota's office as part of an investigation into public corruption that led to Baranello's pleading guilty in April 2004 to bribery and conspiracy charges. Levy was not a subject of that investigation.

The comments were captured by a wiretap and disclosed at a trial. They were reported again by the media in March of last year when Levy sought the Republican nomination for governor. Other taped conversations connected with the investigation were sealed.

"I've gotta have a set of eyes at public works . . . " Levy told Baranello on the phone at 10:12 p.m. on that date. "If I'm keeping this guy [then-Public Works Commissioner Charles] Bartha, there's got to be someone there to make sure that he's not only doing things for me, but that he's not doing it for the Brookhaven Republicans at the same time."

A week before the March 26 conversation, the state Commission of Correction ordered the county to shut down two jail dormitories in Yaphank because of unsafe conditions. The following month, Levy announced that the county would have to build a new facility.

Bartha initially oversaw the jail construction planning when it began in 2004. He left the county in August 2006 after the firm received a contract for topographical surveys and other work at the jail.

Bartha said in an interview that Bowne had been solicited for funds, which he said is typical. "I haven't seen anything out of the ordinary" from Levy's campaign, he said.

Under a resolution sponsored by Levy and approved by the county legislature, the jail was included under a PLA, which guaranteed the work would be done by unions. County spokesman Mark Smith said the county was merely following a longstanding policy that says PLAs must be used on projects over $3 million. By going under the umbrella of the Judicial Facilities Agency, the county could receive an exemption to the Wicks Law, which mandates that governments bid out construction contracts exceeding $50,000, including for electrical, plumbing and heating, ventilation and air-conditioning.

According to Martin Cantor, the JFA chairman, the exemption was designed to save money, but it also gives a construction manager a potentially central role in selecting subcontractors. He said the Wicks law exemption had the effect of opening up fundraising possibilities for Levy because LiRO had discretion in hiring.

"Implicit in this concept is, if you get a contract, you want to say thank you to the people who gave you the contract," Cantor said.

Smith rejected that argument, saying LiRO had "absolutely no role in advertising, reviewing or awarding construction bids." The county's published request for proposals specifically lists the construction manager's responsibilities, including making "recommendations for award of the contracts."

A copy of the September 2004 request for proposals issued by the county, obtained by Newsday under the Freedom of Information Law, outlines numerous "bid services" that are a key component of the construction manager's work.

The construction manager would not only "attend bid openings and record and distribute results," but also "interview prospective low bidders, determine bidders credentials and qualifications and make recommendations for award of the contracts."

The construction manager is also given considerable sway in hiring and monitoring the union workforce. In addition to determining whether or not a project labor agreement is in the county's best interest, the firm is charged with negotiating "a project specific collective bargaining agreement with all craft locals that might be involved in the project."

Smith said all contracts on the jail project were subject to competitive bidding procedures. Last June, Newsday requested all bid documents related to the jail project under the Freedom of Information Law. County officials released two requests for proposal and a limited number of other documents and said others could not be released because they were privileged. Officials later released some documents in response to follow-up requests, but said they had no documents responsive to the request for bid documents.

At a 2003 fundraiser for Levy, Cantor said he recommended to Levy that the project be done under the JFA's auspices. He said he told Levy the Cohalan court complex in Central Islip had been done that way and that it saved money overall.

"I said, 'Why not put the jail under the JFA?' " Cantor said he told Levy. He said he told Levy an exemption to the Wicks Law would save the county money.

While the JFA was important in the county winning a Wicks Law exemption, county officials limited its role in financing the project. Later, JFA officials were angered when they learned that DPW had awarded a $15-million bid without their knowledge, according to JFA minutes. The jail project remains under the auspices of the agency.

The close relationship between officials from the county Department of Public Works and the contractors whose work they oversee can also be seen at annual waterside political fundraisers. These were not uncommon during previous administrations, officials said.

According to several former county officials and contractors who asked not to be identified, department staffers participated in two Levy fundraisers, 2007 and 2008, at The Oar, a waterfront restaurant in Patchogue.

During another fundraiser, in 2008, according to one former county official who attended, top department contractors, Levy friends and others were invited to give to Levy aboard a yacht in Huntington Harbor at a gathering hosted by an executive of J.D. Posillico, the Farmingdale construction firm that has a multimillion-dollar contract at the jail. Tickets to the boat events were $500 and up. Posillico officials didn't return numerous calls for comment.

Referring to these fundraisers, the Department of Public Works' Anderson said, "The companies like access to political figures. They like to be in the know. No matter who's contributing to party A or B, it just doesn't impact the ability to work."

He also said he has no problem with high-ranking department officials going to work for companies whose work on public projects they may have supervised. He said such connections "don't mean diddly."