Times Ledger: Hold EDC accountable over Willets development


Willets Point property and business owners are not surprised that Seth Pinsky, president of the city Economic Development Corp., is attempting to do damage control, now that the state attorney general has determined that EDC and Claire Shulman’s local development corporation acted illegally in pursuing the Willets Point development project (“EDC cites ’08 global crisis,” Aug. 2-8).

But we will not allow Pinsky to misinform the public by downplaying EDC’s admitted illegal acts that threaten our property ownership, thus distracting attention from the glaring need for accountability.

Here are the facts you did not hear from Pinsky: During his tenure as EDC president, EDC engaged in activity so contrary to law that the attorney general is now exercising his statutory power to dissolve EDC and require it to cease its operations and the city to establish a new corporation to handle economic development. Far from safeguarding the corporate existence of EDC, Pinsky saw it driven into the ground on his watch.

Acting on a formal complaint made by Willets Point United Inc., the attorney general has determined that Pinsky’s EDC violated the state Not-For Profit Corporation Law as well as EDC’s certificate of incorporation. Unlike garden-variety nonprofits that are permitted to lobby, EDC was a specific type of nonprofit, dedicated to development, that is prohibited from attempting to influence legislation.

But EDC did so anyway in its zeal to obtain City Council approval of the proposed Willets Point development, including authorization to forcibly acquire our Willets Point properties and businesses via eminent domain.

To those ends, Pinsky’s EDC disbursed city funds to another local development corporation set up by Shulman, which was likewise prohibited from lobbying for legislation. EDC deliberately assigned specific tasks to Shulman’s LDC. For its part, Shulman’s LDC lobbied but filed none of the required registrations or disclosure reports for 18 months — until the city clerk finally interceded, holding Shulman’s LDC liable to pay a record $59,090 penalty.

But EDC continued to disburse city funds to Shulman’s LDC, even after the LDC registered its staff members/employees as lobbyists while their salaries remained payable using city funds disbursed by EDC. Moreover, EDC disbursed city funds to Shulman’s LDC without requiring Shulman to produce evidence of actual eligibility for those funds or entering into funding agreements that contain all of the provisions required by EDC’s master contract with the city.

All of that and more was done to push the proposed Willets Point development, an EDC project that would later be open to bidding by developer firms that are financiers of Shulman’s LDC.

Is it any wonder that city Comptroller John Liu has since called this “EDC’s culture of lawlessness” or that Pinsky now wants to start a friendly dialogue with a newspaper on other topics? If any other company well-known to the public had shown the same disregard for law and contracts as has EDC, the shareholders would demand the immediate resignations of its president and board of directors.

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