Updated: January 14, 2016 07:49 PM
Created: January 14, 2016 12:47 PM
ALBANY - You've heard of the LLC loophole but we've found a brand new one.
Usually the loophole helps campaign donors to get around contribution limits.
However, the NewsChannel 13 “Waste Watchers” team has discovered it’s also keeping you from knowing who the state is doing business with and this affects millions of your tax dollars.
The “Waste Watchers” team has been working on this investigation for nearly three years.
We set out to find how many buildings the state rents or leases.
When we tried to find out who the landlords are, we realized there's a bigger story here.
“I think that there is a problem,” acknowledged Bob Freeman, who heads up the state’s Committee on Open Government.
His office is in One Commerce Plaza in Albany
“Significant aspects of this building are rented by state government agencies,” he pointed out.
According to records that NewsChannel 13 obtained under the “Freedom of Information Law,” we found the state is paying nearly $9 million a year to lease space in that building alone.
So who is getting that money?
The documents we received list three landlords - One Commerce Plaza LLC, 99 Washington LLC and Carrow Real Estate LLC.
“Although we know that an LLC owns this building, there's nothing in any law that requires the principals of an LLC to be identified,” Freeman pointed out.
He's right. NewsChannel 13 asked the Department of State for the LLC filings on each of the One Commerce Plaza landlords. They emailed us 26 separate files. They included names but it's not clear if any of them are the people cashing the rent checks and keeping the money.
The people named are identified as “attorney in fact,” “authorized person,” “member,” “manager,” but no clear building owner.
So NewsChannel 13 went to the Comptroller’s office. They pay the rent so they would know, right? They don't.
They sent a statement saying:
"Rental payments are made out to whomever the lease contract requires us to pay. We don't know whether it's a landlord, a management company, an assignee, individual or other."
So we decided to ask one of the landlords listed - Carrow Real Estate.
Their office is in One Commerce Plaza.
They have not responded to NewsChannel 13’s repeated questions in the last few weeks but when we first looked into this two years ago a woman identified as a senior property manager told us they are not an owner. They are a third party property manager.
At that time she said a private investor owns the building but she was not at liberty to tell me who that investor is.
So we still don't know and there doesn't appear to be any way to find out.
“Since we're talking about, in this case, a substantial expenditure of public monies to my mind the public really should have the right to know,” asserted Freeman.
However, the “Freedom of Information Law” can't help in this case because the law deals with existing records.
Since the state doesn't require names on LLC filings - those records don't exist so in this case we can't tell you who the state is doing business with.
“Do we know whether the names behind the LLC are contributors to the campaigns of any number of elected officials? We don't know that,” admitted Freeman. “We don't know who they are in terms of lobbying. There are any number of potential connections that we don't know about without the names.”
It appears the only way to get the names is to change the law and require names on LLC filings.
NewsChannel 13 has asked several lawmakers, but there does not appear to be any movement in that direction.
If you have any information that may shed light on this story or if you have another "Waste Watchers" idea, email us at WasteWatchers@wnyt.com.
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