WNYC's Bob Hennelly is an award-winning investigative journalist. While at WNYC he has reported on a wide gamut of major public policy questions ranging from immigration and homeland security to power outages and utility mergers.
One of the city's most successful luxury housing developers, Leonard Litwin, has made significant contributions to four of the six candidates currently running for New York State Attorney General.
Through several limited liability companies (LLCs), Litwin, who owns Glenwood Management, gave $25,000 each to Democratic AG contenders Nassau County DA Kathleen Rice, Assemblyman Richard Brodsky and State Sen. Eric Schneiderman. Litwin is also linked to companies that donated the same amount to Republican AG candidate and current Staten Island DA Dan Donovan. The LLCs are listed at the address of Litwin's Glenwood Management Corporation in New Hyde Park, New York.
According to the website CampaignMoney.com, Litwin is also a prolific federal campaign donor. Since 2000, he has donated $700,000 to both Democratic and Republican federal campaign committees across the nation.
A 2004 report released by Common Cause tracked close to $800,000 that Litwin dispersed to state campaigns from 1999 into early 2004, including $133,000 that went to former Gov. George Pataki. Common Cause identified contributions from 20 different LLCs that were Litwin-owned parking garages.
After the Sept. 11 attacks, Litwin received $238 million in Federal Liberty Bonds, dispensed by state authorities, to finance the construction of luxury residential projects in lower Manhattan. Common Cause says ultimately Litwin claimed close to 30 percent of all of the available Liberty Bonds earmarked for residential construction in New York State.
A call to Litwin's Glenwood Management firm was not returned. The four attorney general candidates who accepted contributions from Litwin all say they favor major reforms of the state's campaign finance regulations and closing of what campaign finance experts call “the limited liability company loophole.”
The use of LLCs is particularly common in the real estate industry, where owners often incorporate each individual property as a separate business entity. LLCs were first permitted in New York State in 1994.
The Brennan Center and other reform groups contend New York State's campaign finance regime maybe "meaningless" in large part because of what they say is the LLC loophole. While total campaign giving by individuals is capped annually at $150,000, donors can get around the cap by making additional campaign donations through LLCs they control.
An article published in the Albany Government Law Review in 2008, describes how the use of LLCs rendered New York State's campaign finance meaningless: "If one were rich enough, one could establish a string of LLCs and each could give a maximum ($150,000) contribution. The LLC contribution loophole is another boon for the rich who can circumvent contribution limits by making multiple contributions through LLCs."
Susan Lerner, Executive Director of Common Cause New York, concedes it is legal for candidates running for attorney general to take the real estate industry-linked LLC cash. But, she notes that the public should take note because the attorney general in New York is the major regulator and watchdog over the real estate industry.
"It is absolutely a concern when the real estate industry is donating significant money -- the AG has specific oversight over co-op conversions, over condominiums, as well as over tenant/landlord relationships."
Democratic candidates Eric Dinallo, former New York State insurance superintendent, and Sean Coffey, former federal prosecutor turned trial lawyer, did not have any of Litwin's 1200 Union Turnpike LLCs on their filings.