Additional reporting by Josefa Velasquez
As he hints at running for governor, lame duck mayor Bill de Blasio has racked up nearly $1 million in debts to lawyers, campaign consultants and taxpayers that records indicate he currently can’t pay.
The mayor owes one of the city’s biggest lobbyist law firms upwards of $435,000. On Thursday, the city’s Department of Investigation commissioner informed him he must reimburse taxpayers nearly $320,000 for his use of an NYPD securing detail during his failed 2019 cross-country presidential campaign.
Meanwhile, the latest filings for his various campaign and political action committees reveal he’s got more than $182,500 in outstanding campaign debts — and only about $11,800 cash on hand.
Between all of this, he owes upwards of $929,000, THE CITY found.
Danielle Filson, a spokesperson for de Blasio, declined to respond to nearly all of THE CITY’s questions, stating only that he was awaiting his appeal on NYPD reimbursement.
“Once that decision is made, the mayor will of course proceed accordingly,” she wrote.
But Filson would not discuss his modest cash reserve or any of his debts, including his biggest unpaid bill: the $435,000 he owes Kramer Levin & Naftalis — a firm that regularly lobbies City Hall on behalf of real estate developers seeking favors from the mayor’s administration such as zoning changes and city permits.
Between 2015 and 2017, the firm represented de Blasio personally during multiple investigations of his fundraising tactics. As of Tuesday, he had yet to pay a dime of his long-outstanding bill. And at least for the moment, the firm — which has sued other clients for non-payment — has given the mayor a pass.
De Blasio hired Kramer Levin in 2015 after he began getting inquiries from law enforcement and ethics entities regarding his fundraising tactics. The firm then represented him for two years. By the time its services were no longer needed in 2017, Kramer Levin had billed him for some $300,000.
But he likely owes even more due to interest on the initial bill accumulating over the last four years.
According to court papers the firm has filed accusing other clients of non-payment, Kramer Levin starts charging interest after 30 days of missed payment. The papers state that their protocol is to charge a per annum rate of 9%, which would bring de Blasio’s unpaid bill up to $435,000.
In the last year, Kramer Levin has filed lawsuits against a Diamond District dealer for $1.2 million in allegedly unpaid bills, and two hotel developers for $4.7 million. Both suits are pending.
As of last week, the law firm had taken no such action against de Blasio, even though the bills he owes are now overdue by four years.
Taxpayers Take a Hit
De Blasio has long had a relationship with Kramer Levin via attorney Barry Berke, a partner at the firm best known for his recent role as lead counsel for the U.S. House in the second impeachment trial of then-President Donald Trump.
Berke was an early fundraiser when de Blasio first ran for mayor in 2013. Once he was elected, the mayor appointed Berke to an unpaid post as his designee to Lincoln Center’s board of directors.
In 2015, Berke began representing de Blasio personally when the mayor’s fundraising tactics became the target of investigations by Manhattan federal prosecutors, the Manhattan District Attorney’s Office, the state Joint Commission on Public Ethics (JCOPE) and the city Department of Investigation.
No criminal charges were filed, but de Blasio hardly got away unscathed.
Then-acting Manhattan U.S. Attorney Joon Kim made a point of noting that de Blasio had solicited donations from “individuals who sought official favors from the city, after which the mayor made or directed inquiries to relevant city agencies on behalf of those donors.”
And Manhattan District Attorney Cyrus Vance Jr. found that the mayor’s effort to steer money to upstate candidates to try and switch the state Senate from GOP to Democratic control was “contrary to the intent and spirit of the law” governing campaign finance.
JCOPE investigators, meanwhile, documented several instances in which de Blasio personally solicited donations from developers actively seeking City Hall’s approval of zoning and other property-related favors. Several donors had to pay fines for giving the mayor what JCOPE determined to be illegal gifts.
And the city Department of Investigation determined that de Blasio violated city ethics rules by making these personal solicitations for his non-profit Campaign for One New York.
Nevertheless, in March 2017, de Blasio claimed he’d been exonerated — and said he would “let” the taxpayers foot the bill for the legal representation Kramer Levin and other law firms provided him and other City Hall aides in those investigations. The bill to the public wound up costing about $12 million in total.
Donor Limit Hiked
But de Blasio said the taxpayer payment could only cover what he termed “city-related matters” that were the subject of investigation. He said he still owed another $300,000 to $400,000 to Kramer Levin for its representation of him in what he deemed to be “non-city-related matters,” including the state Senate effort.
At the time, he promised to set up a legal defense fund and raise contributions to pay what he owed.
After the city Conflicts of Interest Board ruled that a ban on gifts to government officials prohibited him from taking any more than $50 per donor, he got the City Council to pass a bill hiking the cap to $5,000 per donor — barring checks from corporations, entities doing business with the city and limited liability corporations that hide their owners’ identities.
By spring 2019, de Blasio claimed he was awaiting guidance from the Conflicts of Interest Board on how to set up the fund, although the law passed by the Council allowed him to create one on an interim basis without their assistance. Once the fund was established, he would soon after have to begin disclosing who was contributing to it.
As of Tuesday, there is no legal defense fund and not a single donation has arrived to help de Blasio pay off his legal obligations to Kramer Levin. And under new rules adopted by the City Council in 2019, once he leaves office he will no longer be obligated to publicly disclose any money he obtains to pay off that bill.
Meanwhile, de Blasio also remains in debt to another lobbyist for unpaid services. When he closed out his 2017 mayoral campaign after winning a second term, he owed Kantor Davidoff, another major lobbyist law firm, $32,800 for “post-election legal” work, the most up-to-date campaign finance records show.
The Kantor Davidoff firm was involved in lobbying City Hall at the time it was working for the mayor’s re-election but has since stopped performing that service. Kramer Levin continues to lobby his administration — and his staff specifically -— on behalf of numerous clients, records show.
This year and last year Kramer Levin attorneys listed Deputy Mayors Vicki Been and Laura Anglin as their intended subject to lobby regarding land use requests on behalf of different clients — including de Blasio’s alma mater, New York University, and a real estate development known as Lenox by the Bridge LLC.
THE CITY sent questions to Kramer Levin and Kantor Davidoff about the status of the debts and did not get responses.
‘Make Him Pay’
De Blasio’s second biggest fiscal headache is one that, at the moment, he’s refusing to pay.
Last week, the Department of Investigation released a report accusing the mayor of misusing the full-time police detail that shadows him as he goes about his duties as mayor.
The report focused, in part, on de Blasio’s use of his full-time NYPD detail to accompany him during the four months of campaigning for presidency before dropping out without ever gaining more than 1% support in the polls.
DOI Commissioner Margaret Garnett said de Blasio needed to reimburse the taxpayers the estimated $319,000 security tab.
Documents show that the city Conflicts of Interest Board told the mayor on May 19, 2019, three days after he announced his quixotic White House quest, that he’d have to pay for his own security.
He ignored the COIB’s advice and didn’t reimburse a taxpayer dime.
Two years later — shortly after DOI told him investigators needed to interview him about his use of the NYPD detail — he filed an appeal. That appeal, he says, is pending.
Filson, de Blasio’s spokesperson, did not answer THE CITY’s questions about why he took more than two years to file his appeal. COIB officials have declined to discuss the case.
John Kaehny, director of Reinvent Albany, a non-partisan good government group, told THE CITY that de Blasio should be forced to pay for using city resources on a purely political endeavor. But he noted COIB rarely goes after such misdeeds, seeing itself more as a teacher than as a cop.
“If you are a teacher, you have to enforce discipline,” he noted. “They need to go to court and enforce this and make him pay. This totally undermines any attempt to enforce the rules if you have the mayor running around ignoring your advice.”