Meet Scardale's Harry Wilson - Candidate for NYS Comptroller
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In these times when it’s clear to all that our state government in Albany is wildly and hopelessly dysfunctional – and no political aspirant for any job seems to be up to the task of governing – or even capable of talking about the task of governing, I may have experienced something akin to what happened when Rolling Stone writer Jon Landau went to a Bruce Springsteen concert in 1974 and proclaimed that he “saw Rock and Roll future and its name is Bruce Springsteen.” Likewise, last week, in a wonky way, I met and interviewed the individual who could be New York’s future, and his name is Harry Wilson. If any one individual is capable of engineering New York State’s government back to fiscal sanity and probity and even possibility, the Republican candidate for State Comptroller, Harry Wilson, will be the one to do so. Nothing less than a whirlwind to interview, he is one of the most genuine, enthusiastic and whip-smart aspirants for public office that I’ve come across. Wilson plans to ramp up the office of state comptroller as a primary catalyst in reforming the finances and the structure of New York State government. In a way -- his vision for the job parallels the transformation Eliot Spitzer wrought on the role of the Attorney General’s office.
Below is my slightly edited interview with Harry Wilson which occurred last week over breakfast at a diner in Scarsdale near Wilson’s home. [ed. with many thanks to blogger/writer/politico Charmian Neary for setting up the interview and for her help in background and context]
DS: Tell me why you got involved and what prompted you to run for, of all political offices, state comptroller:
HW: I returned from Washington last year after finishing my work up with General Motors. [for background on Wilson’s role in the Obama administration’s auto industry task force see this piece by Wayne Barrett in the Village Voice: http://bit.ly/9x99W7 ] I had left my investment firm in anticipation of the birth of our 4th daughter because I wanted to get more involved in public service and spend more time with my family. I was working like 20 hours a day pretty much since high school – and I asked myself is this how I want to spend the next 20 years of my life. I had worked with charitable organizations but I never really had much time to give. And I wanted to spend more time and more focus on my family and public service. I have four children: 9,7, 5, and 2. I was not spending enough time with them and that’s what really catalyzed my decision making process on this.
Around January of 2008 I started thinking seriously about what I was going to do – and made the decision to leave my firm in August. I spent my time getting in quality family time, investing personal capital, doing charity work, and trying to get back into shape. I was happily doing that into early 2009 when suddenly it looked like the world was about to end – it felt like we were about to enter a second Great Depression. My wife and I talked about this a lot and about how I could get involved and contribute. Although I was in financial services, I worked mostly with manufacturing operations and less with banks. I had this really deep skill set in restructuring companies, and I looked at the problems that Washington was wading into with the financial services sector and the auto industry. I was worried that they were going to throw a lot of money at the problem and not fundamentally try to change the structure of these industries. I was deeply concerned about the economy. Growing up, my mom was laid off from her job from time to time and it really affected us.
DS: So how did you actually get involved with the restructuring of GM?
HW: Steve Rattner’s name was being floated to be the car czar. I had never met him before – but I got his email address from folks who did and sent him a blind email describing my background and expertise. I told him that I’m a registered Republican and a free market guy so if that’s a problem for him and the administration – they should tell me now rather than waste everyone’s time. He called me back right away and we met. I had no desire to serve in the administration, but I really wanted to help solve what appeared like an unsolvable problem. We got together and agreed we wouldn’t decide what was going to happen until we actually got there, and I think that was a prudent approach.
So after the task force work I came back home, and a good friend of mine, a Democratic friend, said that the Democratic Party in New York State is broken. It’s broken and there’s no competition. We need really talented Republicans to run for office and you should think about it. I said, “that’s all very nice but I have no interest in running for office” – and she said “well let me introduce you to a friend of mine.” I said OK – and it was Adam Stoll who ran Governor George Pataki’s last campaign for Governor. He and I met and he brought up the US Senate seat held by Kirstin Gillibrand and a congressional seat. I told him that I had no interest in being a legislator. I don’t have that experience or mentality. As a junior member of the legislature – Senate House or otherwise, I wouldn’t really have an impact and that didn’t appear very interesting. Spending half my time in Washington and half my time here also didn’t interest me. Then Adam came back to me in late October of 2009 and asked, “What do you think about Comptroller? “ I knew that the comptroller manages the state pension fund and I said that if I wanted to do that I’d do it for real. I could imagine going into government to help people but not going into government to manage money. Adam said that the Comptroller has a slew of untapped powers that no one’s really used to drive fiscal issues in New York. He compared it to how the Attorney General’s office was a dozen years ago and how utilizing the office can effect change. He gave me some background then I did my own research – really digging into the powers of the office -- the constitutional powers and the statutory powers and how the job has evolved over time. I was also digging into the state’s finances and how bad they were. From that I found two things: (1) I found the state’s finances were far worse than expected. The State does not make projections and it does not do consolidated statements. So no one in New York State pulls together the on -balance sheet debt and the off -balance sheet debt, pension obligations, retiree obligations – no one projects all of that forward – no one does that. And when you do, it’s actually horrible. I came to understand that the Comptroller has a number of dormant powers – with the sizeable staff of the office and the audit power, the comptroller function has been underutilized -- really small dollars have been realized out of the comptroller audits. For example recently the Comptroller conducted an audit of $50,000 in expenditures and then went to two local campaign stops. The Comptroller’s Office has been underutilized to audit state agencies. My expertise could really drive some meaningful reorganization of state government. We could conduct a top to bottom review of spending line item by line item – and also look at the efficacy of how we deliver state government services. Any constitutional office in the executive branch can be leveraged to accomplish something – and I have no interest in just holding a job in the way that appears to be Mr. DiNapoli’s approach to the job. The job has the potential to make major change. If things were running fine I would have no interest in the job.
DS: Given your background – how can you facilitate restructuring state government and its ossified institutions and work with the state legislature.
HW: OK so let’s distinguish between the substance and the political. The substance: what’s a better way to do things – where are the redundancies? Over the course of the first year I would really go through the operations of state government and create a reorganization plan that will result in lower spending and better delivery of services. There may be an array of ways to accomplish that. I would then layout a series of policy choices that would be made by the governor and the legislature that could be framed as options: here’s how you could do this function and at this cost – and lay out an alternative, perhaps a better way. That’s the substance. For the policy piece you have to get the Governor and the State Senate on board. While it would be great to get the Assembly onto this, you have to be realistic. The only way to be a successful governor of the State of New York at this time – is to deal with spending. In 1995 or 1985 you could be a successful governor more easily because there was a more thriving economy. We just don’t live in that world anymore and we won’t for the next several years. Both candidates for Governor see that and see that it’s in their best interests to do deal with spending. As far as my role, I’ve spent my whole career staying out of the media due to the frequently confidential issues of my business dealings -- so I don’t have a need to be in the spotlight. If I did I wouldn’t be running for comptroller! As for the Senate – Republicans historically were not much different from the Democrats – signing off on bad budgets. But you will see the Senate balance of power in 2011 shift to be a more reform-oriented body. Lee Zeldin in Long Island, Jack Quinn. Young, fresh, idealistic new members will come in. On the Assembly Silver will still have a substantial majority – maybe slightly less than he has today. But there appears to be no threat to his leadership role. I foresee developing a bipartisan coalition for reform among the Governor, the Senate and the Comptroller – and I see myself in the job as providing some of the intellectual underpinning for that. I’ll have the staff and the experience to identify the cost savings. The Governor obviously has professional staff in the budget office and I foresee working with them very closely. So that’s the coalition I see forming. It’s a function of logic – and also of self-interest – theirs, not mine. And let them drive that – let them be the public face of reform. And embarrassment will be a driver too – there are hundreds of programs that won’t pass the smell test of public scrutiny.
DS: It seems to me that the two primary functions of the State Comptroller’s office are incompatible – being the chief fiscal officer and being the sole trustee of the state employee pension fund. If you want to be a reform/change agent for the state --- that would seem to be to conflict with your fiduciary obligations with respect to the state pension fund oversight.
HW: While the functions of the office are seemingly incompatible – they actually can be synergistic. Regarding pensions, DiNapoli’s view is to not advocate for any changes. In the last legislative session there were about 50 pension sweeteners pending – and everyone knows we can’t afford to pay for the existing pension benefits let alone add to them. This is a real failure of leadership. I don’t blame the public sector unions and their members – it’s the politicians – the management team. In part it’s because they’ve operated under the assumption, espoused by Tom DiNapoli, that the pension fund is over funded. But now even DiNapoli admits that is not the case. We started highlighting the fact that the fund was operating under overly rosy assumptions and that the pension fund costs were going to skyrocket. DiNapoli attacked me and said I was irresponsible and didn’t know what I was talking about. Then all we did was ask him to release his assumptions and by doing so prove us wrong. But he didn’t release them. He refused. [ed. Note Wilson filed a freedom of information request last June and had yet to hear on that request as of the date of this interview] By painstakingly doing our research from available data, we found that the tax impact per household to stabilize the pension fund would be about an additional $1,300 per year. DiNapoli said everything was fine – we’re fine with an 8% fund earnings assumption and that we’re over funded – and Wilson doesn’t know what he’s talking about. I issued a 50-page white paper that the New York Times covered. After the release of my report, DiNapoli held a press conference that announced they were going to reduce the earnings assumption to 7.5% -- and that we’re not fully funded – but that the fund is about 94% funded. So now he’s admitted to a part of the problem – but in fact that’s only a tiny fraction of the problem. Then Orin Kramer in an op-ed in the New York Times cited my findings in a think piece about pension reform]– and I had never met Orin Kramer before. So what you have is taxpayers and local government officials who have to make up the shortfall on the one hand vs. Albany politicians who’ve made promises they probably don’t understand and that we can’t afford on the other. That’s the debate for this race – and if people really understood it that way – this would be a landslide election. Let’s be honest about it – if people in Albany really understood the scope and depth of our state government financial situation, we wouldn’t be talking about sweetening pension benefits but fixing them. It’s a fact of life that politicians like opacity when dealing with financial issues.
DS: There’s been some discussion and perhaps some contrast between you and Tom DiNapoli on pension fund management – and in the wake of the Comptroller Hevesi scandal whether the comptroller should be the sole trustee. What’s your take?
HW: Tom DiNapoli hasn’t made a proposal – he said he likes the set up the way it is but if the legislature changes the role he’ll live with that too. My approach is different in two respects: one -- how decisions get made for the fund and two -- asset allocation of the fund. The virtue of the sole trustee is that you have one person accountable and with an incontrovertible mandate to protect the pension fund against raids. Ironically, Tom DiNapoli proposed and supported such a raid on the pension fund to balance the state budget in 2009. The Assembly voted yes, and the Senate voted no – but as for the Senate, this vote occurred in the middle of the coup by Pedro Espada and friends, and the vote against the plan was viewed by some as just a slap at DiNapoli because he was withholding legislators’ pay – as he’s required to do when a budget is late. Reintroduced into the budget this year, supported by DiNapoli, this time it passed. So the State is not paying in $200 million that it’s supposed to be paying in. This is basically a raid on the fund to be used to balance the state budget. It’s outrageous that the public sector unions supported DiNapoli on this front because he’s the one who’s supposed to protecting the fund against these kinds of raids. What about the proper role of the Comptroller being the sole trustee of the pension system? How do you keep the positive and fix the negatives of the sole trusteeship? One is to create an investment committee of world-class retired investors and in this state we have more of that than anywhere else in the world. They would do this as public service volunteers. They would advise the Comptroller generally about the economy and optimum asset allocation strategies. And they would provide an ethical backstop to the comptroller on active managers. Any potential active manager would go through the investment committee before they come to me. Let’s take a step back. Let’s forget about how public pensions are managed today and ask what’s the right way to manage. Unlike a mutual fund which generally has a mandate to invest in a particular sector or class of investments, pension funds exist to deliver a constitutionally guaranteed benefit come hell or high water. So you need to manage the level of risk in this pool. You need to have a lower risk pool of assets that can be better handled and perhaps have as a goal a 5-6% return. This would involve less active management and lower fees to the system. The legislature caps risky assets for the fund but doesn’t cap lower risk assets. Alan Hevesi and his successor, Tom DiNapoli, have advocated lifting the cap on risky assets, thankfully unsuccessfully. DiNapoli pays $200 million in fees to private equity and hedge fund managers, and $350 million in total fees per year to money managers for the pension system. So in his 3 years as Comptroller, DiNapoli has paid over a billion dollars in fees to Wall Street. And he criticizes me for having actual experience in this field! My approach to pension fund management would actually reduce fees to Wall Street because there would be less active management in the pool. By and large active money managers cannot outperform the market particularly if you tack on the hefty fees they charge – so I would reduce it. I would lessen active management and bring in seasoned retired veterans for outside expertise to advise on asset allocation.
DS: OK – so give me the main takeaway from how you would fix Albany as Comptroller.
HW: I would do 3 primary things – (1) review every dollar top to bottom and propose a restructuring plan for the state as a holistic enterprise; (2) Pension system reform – I would fill the hole without raising taxes and without lessening benefits; and (3) I would perform cost-benefit analysis on all legislation and regulations to ascertain whether it resulted in unfunded mandates – you need to do this for each and every proposal. That’s what the comptroller should be doing. The comptroller should be the objective, professional fiscal overseer of all aspects of state government.
David A. Singer is a former political consultant/campaign professional and political junkie currently toiling as a lawyer in Westchester and managing real estate and media investments.
Local Campaigns Heat Up
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With just weeks to go until Election Day on Tuesday November 2, local campaigns are heating up.
State Senator Suzi Oppenheimer has gone on the offensive with a new television commercial and large four-color mailer that calls her opponent Bob Cohen a slumlord and contends that he allowed drug dealers to operate on his property. The mailer says, “if we can’t trust him (Cohen) to keep drugs away from our kids, how can we possibly trust him to clean up Albany?”
The photos on the mailer depict crumbling buildings and an unflattering profile of Cohen, who many in Scarsdale know as a wonderful father, generous landlord and all-round good guy. According to Scarsdale resident Anne Lyons the mailer was “shocking,” and “the smear campaign is unproductive and detracts from a healthy discussion of the issues.”
In response to these charges, Cohen has released a new television commercial which you can see here. An email from the Cohen campaign explains, “The fact is Bob Cohen has built a successful business improving neighborhoods,” said spokesman Josh Hills. “He buys old, decaying buildings that have been mismanaged and neglected, are not up to code, often arrears on taxes, and renovates them into safe homes for moderate-income families. The investments he makes in upgrades improve the properties, improve neighborhoods and create jobs. Senator Oppenheimer should be ashamed for stooping so low as to attack Bob for fixing pre-existing violations.”
In other campaign news, Cohen is airing a second commercial on local television, and held a gathering in Heathcote to greet friends and tell them more about his campaign.
In other campaign news, Cohen is airing a second commercial on local television, and held a gathering in Heathcote to greet friends and tell them more about his campaign. On September 30th he held a press conference at the Galleria in White Plains to warn Westchester shoppers of a new clothing tax that is now in effect. Cohen charged Democrats with “swindling” Westchester taxpayers, and pledged to reverse the tax and spend policies of Senate Democrats and shelve the clothing tax.
The tax, that went into effect on October first in New York State, is a 4 percent sales tax on clothing and footwear costing $110 or less. According to Cohen, “This is yet another case where Albany’s career politicians are hurting New York families, and this tax represents only a fraction of the $4 billion in new taxes enacted in this year’s state budget. Families and small businesses across the state are cutting back, but over the last two years, Senator Oppenheimer and her allies in the Legislature have hiked income taxes, raised business taxes, eliminated STAR property tax relief checks, and increased fees on everything from motor vehicle registrations to fishing licenses. The clothing tax is particularly damaging because it impacts middle-class and low-income families the most, and hurts small retailers by driving commerce to other states.”
On September 28 Oppenheimer was endorsed by Choice Matters, a group that works to get pro-choice candidates elected and appointed at every level of government. In announcing the endorsement, Choice Matters President said, "Suzi Oppenheimer and Andrea Stewart-Cousins have spent their careers fighting for women’s reproductive freedom and—as some of you may know—freedom does not come cheap. We need these women! They have put their political capital on the line for us and now we need to make sure they are returned to the New York State Senate this November.”
Meanwhile, State Assemblywoman Amy Paulin who faces Republican Rene Atayan, has also been campaigning and updating her constituents on new legislation. Her bill to limit underage alcohol consumption and drinking and driving has been signed into law by Governor Paterson. The bill encourages bars and restaurants to have their servers participate in alcohol training awareness programs.
“The use of fake IDs can lead to underage drinking and drunk driving -- problems that can be devastating to a community,” said Assemblywoman Paulin. “These programs can help decrease alcohol-related incidents in New York by teaching employees, as well as bar and restaurant owners how to spot underage individuals while protecting their business.”
You can meet both candidates on Tuesday October 19 at 7:30 pm when the League of Women Voters of Scarsdale will host a Candidate's Forum in the Scott Room of the Scarsdale Public Library.
State Senator Suzi Oppenheimer and Republican nominee for State Senate Robert Cohen will attend as well as State Assemblywomen Amy Paulin and her challenger Rene Atayan. Each candidate will make a brief statement and then they will answer questions posed by the League.
Welcome New Patrolmen
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The Scarsdale Police Department held an orientation ceremony for new officers at 5 pm on Wednesday September 22nd at Village Hall. The ceremony marked the hiring of four new officers who will be on patrol in Scarsdale. Watch out for them and they will watch out for you.
Pictured here, from left to right are Paul Zavadil, Eric Logiudice, Chief Brogan, Dinis Castro, Anthony Gaudio and Esther Davis who has been working at the switchboard and dispatching duties since August 4th. Officers Zavadil and Logiudice are new policemen and Castro and Gaudio have transferred to Scarsdale from other communities.
More Bad News for Andrew Zayac
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According to the Danbury News Times, there was more bad news for Scarsdale’s Andrew Zayac in Bridgeport Court on Monday when a federal grand jury returned additional charges of conspiring to use a firearm in a crime of violence and destruction of evidence.
Zayac and Herbito Gonzales of the Bronx are accused of robbing and murdering Bronx drug dealer Edward Rivera and dumping his body in Danbury in February 2009. The government contends that Zayac and Gonzalez set up a meeting with Rivera to buy 80 pounds of pot on February 8, 2009. Rather than pay for the drugs, they shot Rivera and then dumped his body near the Padanaram Reservoir where it was found two days later. When they returned to the Bronx they burned the Jeep they had driven to destroy the evidence. Investigators obtained a search warrant to go into the Zayac’s home and found 50 pounds of marijuana.
Before these new charges were made, Gonzales’ trial was to begin on October 4, but it has now been postponed until January 11, 2011. According to their lawyers, Zayac and Gonzales will be tried separately as they both made statements to the police that would incriminate the other man. Zayac will be tried in February, 2011.
Andrew Zayac was a star soccer player at Scarsdale High School, and graduated from SHS in 1998. In 2000, county police arrested him and two others for allegedly possessing more than 1,000 ecstasy pills. Zayac is the son of Linda Zayac, a treasured member of the staff of the Greenacres School, and Bob Zayac, a popular soccer coach who now runs the Soccer Camp for the Village of Scarsdale.
Chamber of Commerce Debates Village Events
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The September meeting of the Scarsdale Chamber of Commerce became contentious on Tuesday evening September 21, as members gathered for a meeting at Rothmans on Boniface Circle.
Under the leadership of Lewis Arlt at Houlihan Lawrence the membership has grown to 85 members and now includes traditional retailers as well as banks and service providers. Members snacked on delicious refreshments provided by Lange’s and the new Good Life Gourmet and had the chance to get reacquainted with members of the Scarsdale business community.
Village Planner Liz Marrinan was invited to update the group on the Comprehensive Village Plan as well as a proposal to change the parking requirements for restaurants to make it feasible to bring more eateries into the village. Surveys done for the Comprehensive Plan revealed that residents would like a livelier downtown with more restaurants and cultural events. As a consequence, the Planning Board is studying the parking requirements, which now dictate that restaurants pay a steep fee to the village to finance the required number of parking spots, which are double the number for restaurants than they are for retail stores. Marrinan’s initial work shows that Scarsdale’s parking requirements for restaurants are far more restrictive than neighboring towns such as Bronxville, Rye and Larchmont. Relaxed requirements would allow the village to convert retail locations like the former Waterworks space into restaurants and apparently the village has already received many inquiries from restaurateurs who wish to open in the Village.
She said that the Planning Board will soon hold public hearings on the issue and invited the membership to attend.
She also provided an update on the Popham Road Bridge, currently under construction. Three lanes should remain open during all phases of the project and ultimately there will be ten-foot sidewalks on either side of a five-lane bridge. The entire bridge is scheduled for completion by November 2011 and the total cost is of the work is estimated to be $17.2 million.
Mayor Carolyn Stevens was also on hand and concurred with Marrinan that changing the parking requirements could lead to a livelier downtown. She asked the retailers to consider remaining open at night to bring shoppers and diners to the Village in the evening.
The conversation grew heated when Arlt brought up the summer Sidewalk Sale. Though it had been a successful sale, several retailers were angry that vendors who did not own stores were permitted to set up tables directly in front of retail stores and sell competitive merchandise. Since the Village has several jewelry stores, they felt that it was not right to have outsiders selling jewelry on the sidewalk and asked that this policy be reconsidered. A sub-committee was formed to edit the Chamber by-laws to avoid a similar situation in the future while still inviting businesses and organizations without a location in the Village to participate.
Similarly, the Fine Arts Festival, which was held on Father’s Day weekend, was also the subject of debate. Many of the artists had set up booths directly in front of store windows, preventing customers from accessing Village stores on this popular shopping weekend. The streets of the Village were closed to accommodate the artists and with little parking available, residents stayed away from downtown and did not make Father’s Day gift purchases. A local art dealer felt that the quality of the art was poor and that the festival had little benefit to Scarsdale.
As it was successful for the show producer and did bring foot traffic to the Village, the Chamber has been considering repeating it next year. But the retailers contended that the Festival producers gain was their loss. Retailers were adamant that they did not want to host another festival in the Village and asked that it be set up at Village Hall. Arlt promised to consider the memberships’ concerns and to formulate a new plan for the festival.
Watch for upcoming events sponsored by the Chamber of Commerce, including the Scarsdale Concours on October 17, Halloween Window Painting on October 24 and tree lighting on December 3.
