Thursday, November 12, 2009

Re:Is it Legal

We have been arguing-one could say vociferously-that the political activities of the Flushing/Willets Point/Corona LDC were in fact a blatant violation of its not for profit status. We are only belaboring the point because it feels as if the authorities charged with investigating the charge-the NYS AG, and the IRS-are dragging their feet. But we could be wrong, and there may be ongoing investigations that are being done in a time consuming but judicious manner.

What's the big deal here if the LDC did in fact operate as an illegal political action organization? The big deal, in our view, devolves from the fact that property rights are a fundamental constitutional right-and should be sacrosanct. If there is agreement on this point, than the process that is implemented to take the property of the Willets Point businesses should be as scrupulous and as above board as possible.

Remember, the effected companies are already at a huge disadvantage combating the power of the city; and the area that they are located in is easily disparaged-in spite of the fact that its condition is directly related to the city's own dereliction. If this is the case than it should be incumbent on the city, and its economic development arm at EDC, to refrain from employing illegal lobbying tactics that put the small business owners at an even greater disadvantage.

When it does this using a phony grass roots entity, it unfairly stacks the deck-and as a consequence corrupts the democratic process. So, if this is the case, than in our view the validity of the Willets Point ULURP application is also called into question.

But we have been giving this question some thought-and really examining the relevant IRS statute even further. Here's what it says:

From Instructions to Form 1023 (the application for 501c3 status):

"You are attempting to 'influence legislation' if you directly contact or urge the public to contact members of a legislative body for the purpose of proposing, supporting or opposing legislation. You are also attempting to influence legislation if you advocate the adoption or rejection of legislation...

Organizations described in section 501(c)(3) are prohibited from engaging in a substantial amount of legislative activities. Whether you are engaged in substantial legislative activities depends on all of the facts and circumstances"

Well the facts and circumstances here leave little wiggle room-especially since LDC head Shulman herself has helpfully explicated her role and that of her group. As the NY Times pointed out: "In late 2006, as the Bloomberg administration girded for what promised to be a bruising rezoning fight over the Willets Point section of Queens, it enlisted the help of Claire Shulman, the former Queens borough president. At a meeting in City Hall that December, Ms. Shulman and Daniel L. Doctoroff, then a deputy mayor, agreed to form a nonprofit group with city and private money. Its primary purpose, Ms. Shulman said, would be to lobby on behalf of the mayor’s plan to turn the long-neglected area near the New York Mets stadium into a thriving hub of shops, hotels, condominiums and a convention center."

Given these set of facts, it is time for the agencies charged with the enforcement of the law to simply do their job-since we have been lectured of late that no one should consider themselves above the law, no matter what position they have held, or their obvious political connections, than the task in front of them shouldn't be complicated whatsoever.