From the Wall Street Journal:
New York City's economic-development agency and two related organizations admitted in a settlement Monday that they illegally lobbied the City Council on behalf of projects at the heart of Mayor Michael Bloomberg's redevelopment agenda.
The concessions came after a three-year probe by the state attorney general's office. Investigators found that the Economic Development Corp. worked behind the scenes with the groups—called local development corporations—to nudge lawmakers to support projects in Willets Point in Queens and Coney Island in Brooklyn.
"These local development corporations flouted the law and lobbied elected officials, both directly and through third parties," Attorney General Eric Schneiderman said in a statement.
The local groups—the Flushing Willets Point Corona Local Development Corp. and the Coney Island Development Corp.—arose out of Mr. Bloomberg's plan to remake two of the city's grittiest pockets. Officials envisioned turning Willets Point, a wind-swept swath of auto-repair shops, into a shopping and residential center, and overhauling Coney Island into a more upscale seaside retreat.
In pushing the Council for zoning and other land-use changes, city officials "took steps to foster the appearance of independent 'grass-roots' support for the projects in the local community," said the agreement signed Monday by the EDC and the other groups.
The finding carries no fine or harsher penalty. The EDC, a nonprofit, must restructure and shed its status as a local development corporation. The other two groups have agreed not to lobby or encourage third parties to speak with elected officials.
Irene Prestigiacomo, a member of Willets Point United, a group opposed to the city's plans for the area, said she was disappointed in the outcome.
Ms. Shulman's organization has "gotten away scot-free with breaking the law at our expense and have been rewarded with a mild tap on the wrist," Ms. Prestigiacomo said.