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‘Everyone is literally flabbergasted,’ state source says of Buffalo Billion probe

ALBANY – One was like a son to the late Gov. Mario M. Cuomo and brother to the current governor, Andrew M. Cuomo.

The other was a longtime friend of Andrew Cuomo, starting out as a trusted staffer to Mario Cuomo in the 1980s, a job that placed him in a harrowing emergency landing in a smoke-filled plane with the former governor in 1988.

But now, Joseph Percoco and Todd Howe are part of U.S. Attorney Preet Bharara’s year-old expanding investigation into Andrew Cuomo’s Buffalo Billion program.

With a new round of subpoenas sent out over the past week, including to Cuomo’s executive chamber on Friday, federal investigators are examining the contract awards process in the Buffalo Billion program, as well as possible other state projects elsewhere.

And Albany was reeling as it became known that the probe was getting close to trusted Cuomo advisers.


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No other member of the Cuomo team had more staying power, influence and trust than Percoco, who left his senior aide job in January to work for Madison Square Garden Co.

“The devastation is acute. Everyone is literally flabbergasted,” one state source said of the governor and his executive chamber staff.

The Cuomo administration has been silent about the Bharara investigation of the Buffalo Billion since it surfaced last fall until Friday, when it released a statement by an in-house lawyer and private lawyer that was a remarkable admission about the possible extent of the problem.

“The state has reason to believe that in certain circumstances and regulatory approvals they have been defrauded by improper rigging and failures to disclose potential conflicts of interests by lobbyists and former state employees,” stated Bart M. Schwartz, a former federal prosecutor retained by the Cuomo administration.

The breadth of the investigation broadened Saturday when the New York Times reported that investigators are trying to determine whether Percoco and his wife might have gotten tens of thousands of dollars from a design and engineering firm involved in the Buffalo Billion project.

The company that handled civil engineering on the RiverBend project is Albany-based CHA, an Albany-based engineering firm that formerly was known as Clough Harbour Associates.

That big engineering firm does regular business with the state, according to a source with knowledge of RiverBend. CHA already was involved in the project before two local firms – LPCiminelli and McGuire Development – were selected to provide construction and development work for the broader Buffalo Billion program.

The president of CHA has not returned calls or emails from The Buffalo News since Friday evening.

Percoco’s lawyer, Barry Bohrer, declined comment Saturday when asked whether Percoco had received payments or income from CHA.

Bharara last year issued subpoenas to two state entities involved in the Buffalo Billion program: the governor’s economic development agency and SUNY Polytechnic.

LPCiminelli and McGuire Development, which have separate Buffalo Billion contracts, also received subpoenas. LPCiminelli officials had no further comment Saturday after saying Friday evening that they had not received any more subpoenas since the inquiry began and that there is no indication the company or its principals are targets.

Citing the investigation, the Cuomo administration declined to comment on several issues, including whether the governor was ever personally told by Percoco or anyone else whether Percoco may have had outside income in recent years.

It also won’t say what information the administration has that the state may have been “defrauded” by individuals or entities in the Buffalo Billion or some other projects.

Schwartz was asked Friday to review past, current and future spending by the Buffalo Billion program, but payment to the lawyer has not yet been worked out, according to John Kelly, a spokesman for Cuomo.

Kelly said Saturday that Schwartz’s review of the Buffalo Billion contracts will include making recommendations “as to any changes that should be made in the interim.” Kelly did not elaborate, but said he doesn’t expect “at this time” any delays with the SolarCity project

Another Cuomo official, Alphonso David, the governor’s counsel, said on Saturday that the office will not be “commenting or speculating on the specific facts of this matter” while the Bharara probe and new internal review of the Buffalo Billion is ongoing.

Cuomo has made no public statements since his office was subpoenaed Friday and word surfaced that Percoco and Howe were among the people and entities federal prosecutors are examining.

“It’s stunning,” one longtime Cuomo loyalist said.

The Confidant

The job title Percoco held with Cuomo until January – executive deputy secretary – was far from descriptive of his real duties. More accurate would be free safety.

“It wasn’t a job for him. It was family,” the loyalist said of Percoco’s connections to Cuomo.

The St. John’s University law school graduate began doing advance work for Mario Cuomo in the early 1990s. He joined Andrew Cuomo’s staff in 1999, when Cuomo was the federal housing secretary during the Clinton administration, and he has been with the younger Cuomo since. That included being a part of a team that helped Cuomo restore his political reputation after a failed run for the Democratic gubernatorial nomination in 2002.

In 2012, The Buffalo News reported about a handful of relatively unknown people in Albany – in and out of government – who hold great influence over the state budget, policymaking and politics. Percoco was a part of that story.

Percoco does not relish the title some have given him as Cuomo’s “enforcer.” But it is a reputation he earned with people who crossed Cuomo or did not do what Cuomo wanted. Percoco handled everything from making sure public events went smoothly to collecting intelligence. He also helped soothe and woo legislators.

Born in the Bronx and raised in Rockland County, Percoco, 46, had a front-row seat with Cuomo on matters of policy and politics.

Percoco also sought to fly under the radar. Project Sunlight, a state web page that came out of a 2011 ethics law designed to make public information about individuals and entities meeting with state officials, lists only two meetings when Percoco’s name is typed into the “government attendee” search field. When the administration last December floated word that Percoco was leaving the governor’s side to join the private sector, they said Percoco, with a young family, needed to make more money. Like Cuomo, Percoco lives in Westchester County.

Payroll records from the state comptroller’s office were unavailable Saturday to show precisely when Percoco went off and then returned back to his $169,000-a-year job with Cuomo.

Percoco left the state payroll in April 2014 to work on the re-election campaign and returned in December. but the specific dates were not available Saturday, Cuomo spokesman Kelly said. A state ethics agency spokesman said Percoco’s annual financial disclosure report, a requirement for most state workers, will not be available until Monday. Such reports are required to show income a state worker, or their spouse, receives in a year.

Cuomo also paid Percoco for work on his campaign, including a $120,000 bonus paid in February 2015 for his efforts in Cuomo’s 2014 re-election. Between 2010 and the 2015 bonus, the Cuomo campaign paid Percoco $349,000 in bonuses and wages.

The Lobbyist

Howe handled a variety of tasks for the late Mario Cuomo when he was governor, including scheduling and advance work. When Andrew Cuomo joined the Clinton administration in the Department of Housing and Urban Development, several loyalists joined him, including Howe.

When Cuomo was later named housing secretary, Howe’s title was deputy chief of staff. He also served under Labor Secretary Robert Reich.

Howe works in a Pennsylvania Avenue office a couple blocks from the White House. He is president of WOH Government Solutions, a subsidiary of the Albany law and lobbying firm of Whiteman Osterman & Hanna. He took the job after holding a senior post at the Mortgage Bankers Association of America, a trade and lobbying group.

Whiteman Hanna’s lobbying client list includes LPCiminelli.

Howe is listed in state disclosure forms as being a retained lobbyist. The current contract the firm has with LPCiminelli was signed March 10, and calls for a $55,000 fee for providing “legislative and regulatory counsel work” until the end of December.

State records show several meetings Howe attended with state officials. One occurred Dec. 24, 2013, in Albany with officials from the Division of Homes and Community Renewal to discuss an undisclosed state contract. Also in the meeting was Steve Aiello, president of Syracuse-area based Cor Development Co.

The Wall Street Journal reported that Bharara is looking to determine if Percoco had any outside income from several different companies, including Cor Development. Aiello did not return a call for comment Saturday, but a spokeswoman told the Syracuse Post-Standard that no payments of any kind were made to Percoco.

Howe has been described as a “close friend” of Cuomo. He has played some sort of role in Buffalo Billion matters, sources have said, though the precise details have never been revealed. The Cuomo friendship would appear to be over, or certainly tattered, as of Friday. The administration ordered no state officials can be in contact with Howe.

Howe has two airplane stories related to Mario Cuomo. In stormy skies one night in late November 1988 on a trip back from New Orleans, Cuomo’s state plane, with Howe aboard, was forced to make an emergency landing at a Pennsylvania airport after an electrical problem filled the cabin with smoke.

Four years later, Cuomo was considering a run for president. Howe arranged for two private planes to be dispatched to the tarmac to ferry Cuomo, aides and reporters to New Hampshire to start his White House run, news reports noted.

Neither the planes, nor Cuomo’s presidential bid, got off the ground that day.