The council’s current money scandal is actually two scandals. The first part involves “member items,” the annual disbursement of tax dollars to community groups according to requests from individual council members. The dispensing of member items has long been one of the council speaker’s greatest powers. Quinn, to her credit, took steps to make the process more visible, instituting a paper trail for each item. Members, for the first time, are also supposed to declare possible conflicts of interest. Still, cash has found its way into strange pockets. Maria del Carmen Arroyo of the Bronx steered $82,500 to a social-service agency that had employed her sister and a nephew. Seabrook applied for nearly a million bucks for the Bronx African American Chamber of Commerce, an operation that happens to share an address with Seabrook’s district office. Last month, U.S. Attorney Michael Garcia indicted and arrested two staffers of Brooklyn councilman Kendall Stewart for siphoning $145,000 of member-item money from a charity: the Donna Reid Memorial Education Fund.
The second source of trouble has roots extending to at least 1988. That’s when the council began setting aside fairly small amounts of budget cash for a reserve fund, to be used throughout the fiscal year to correct errors or respond to emergencies. The reserve fund may have plugged legitimate holes, but as it grew, particularly during the term of speaker Gifford Miller, it provided the speaker’s office a powerful sub rosa tool to reward friends.
The practice of using fictitious groups to park money for later distribution dates as far back as fiscal year 2001, under speaker Peter Vallone. In fiscal year 2007, eighteen nonexistent groups with borderline-comical names such as “Coalition of Informed Individuals” were funnels for $4.5 million. Quinn was moving to eliminate the reserve funds—and says that when she first learned of the bogus groups, about six months ago, she immediately forwarded the information to federal and city investigators.
One week after the Post broke the slush-fund story, Quinn, trying to appear aggressive, called a press conference to unilaterally announce her budget-reform proposal. The key idea was shifting control over discretionary spending to the mayor’s office. “When you jump out there and suggest the power be given to the mayor, it’s an implication we’re not doing the right thing,” council member Fidler says. “This notion that we’re all pigs at a trough is offensive. We’re part of the budget process—by charter. It’s one of the few powers we’ve got!”
Certainly part of the council’s rebellion is about its diminishing power. But the fact is that in many districts council members are the public’s only real contact with elective government, and for smaller groups, member-item funding is a dire necessity. While a few corrupt, self-dealing members deserve legal jeopardy, most are an important link to the nuts-and-bolts functioning of the city’s myriad neighborhoods. “It’s not like we’re building a bridge to nowhere in Alaska,” Fidler says. “These member items that get called pork are the lifeblood of 200 to 300 not-for-profit organizations that do valuable work. We should be telling people clearly what these groups do: ‘This is a homeless shelter, this is an aids-prevention program. It may have a strange name, but this is after-school-program money.’ ”
There’s another factor fueling the anger at Quinn, though. “Her press conference was totally and utterly disingenuous,” Liu says. “It was held not by a speaker but by a mayoral candidate. Someone who should have been functioning as the leader of the legislative body threw us under the bus.” Liu readily admits that he’s considering running for comptroller next year. He’s hardly alone: Thanks to term limits, nearly half the council is angling for some other job. If Quinn doesn’t stick up for the council’s image, it hurts their chances.
The slush crisis appeared at the high point of Quinn’s speakership. She had spent months talking up the environmental and health benefits of congestion pricing. Then, as the deadline for federal funding loomed and Bloomberg pressed for legislative approval, Quinn was at her inside-politics best: cajoling, threatening, and stroking council members. On Monday, March 31, she assembled a solid 30-20 majority vote in favor of the controversial plan to charge drivers $8 to enter midtown Manhattan. Perhaps most impressive, Quinn found twenty of the votes in members representing outer-borough districts, where supporting congestion pricing was a real political risk. “She knows when to use sweetness and when to apply pressure,” says an aide to another city official who watched Quinn closely during the congestion-pricing drama. “I was incredibly impressed. She proved herself an extraordinarily capable politician. That’s the irony of what came next.”
The Post broke the slush-fund story three days after Quinn’s triumph. Her slide downhill accelerated the next week, when state assembly boss Sheldon Silver refused to schedule a vote on congestion pricing. “As a leader Chris is the opposite of Shelly,” says a veteran political consultant who knows and likes Quinn. “On congestion pricing, he didn’t want his members’ names in the paper. He protected them. Quinn took the Times’s praise over exposing her membership.”