Mayor's Office Skirted Rules to Fund Groups: Report

Mayor says the money was doled out legally

Tuesday, Aug 4, 2009  |  Updated 2:49 PM EDT
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Mayor's Office Skirted Rules to Fund Groups: Report

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Bloomberg's aides may have broken contracting rules, a report says.

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Aides to Mayor Michael Bloomberg violated government contracting rules for years by funneling money to at least two politically connected nonprofit groups, a published report said.

Between 2002 and 2006, the mayor's office gave $1.1 million to the Orthodox Agudath Israel of America and $400,000 to Ohel Children's Services from a special discretionary fund, The New York Times reported.

By law, the funds can be disbursed only if requested by a City Council member or borough president.  But, according to records and interviews, in at least two instances, the money was given directly by Bloomberg's office, the Times said.

The Bloomberg administration says it distributed the money annually to the two groups at the request of Councilman Simcha Felder, a Bloomberg ally.

But Mr. Felder, a Brooklyn Democrat, says this isn't the case.

“I did not ask for it,” Mr. Felder said in an interview.

A spokesman for the mayor said the administration disagrees with Felder’s account and said the money was looked at and released in accordance with government contracting rules.

 “We have no reason to think that the funding analysis contains any errors,” Bloomberg's spokesman, Marc LaVorgna, said. “And we disagree with the councilman’s recollection.”

The mayor’s office said it had no documentation showing that Felder had made the request.  

Agudath Israel and Ohel provide services including career counseling and mental health care and are powerful institutions in the city’s Orthodox Jewish communities — political forces long courted by the mayor, the Times said.

Last year,  a discretionary fund operated by New York's City Council became the subject of scrutiny and embarrassment.  That fund financed hundreds of nonprofit groups -- some non-existent or bogus organizations with official-sounding names.  Other groups receiving money were found to employ relatives of lawmakers.

A wide-ranging criminal inquiry into that fund has led to the indictment of two Council aides and the resignation of a Council member, Miguel Martinez.

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