New York is getting played for chumps trying to get medical equipment and supplies

Propublica

With the coronavirus outbreak creating an unprecedented demand for medical supplies and equipment, New York state has paid 20 cents for gloves that normally cost less than a nickel and as much as $7.50 each for masks, about 15 times the usual price. It’s paid up to $2,795 for infusion pumps, more than twice the regular rate. And $248,841 for a portable X-ray machine that typically sells for $30,000 to $80,000.

This payment data, provided by state officials, shows just how much the shortage of key medical equipment is driving up prices. Forced to venture outside their usual vendors and contracts, states and cities are paying exorbitant sums on a spot market ruled by supply and demand. Although New York’s attorney general has denounced excessive prices, and ordered merchants to stop overcharging people for hand sanitizers and disinfectant sprays, state laws against price gouging generally don’t apply to government purchases.

With little guidance from the Trump administration, competition among states, cities, hospitals and federal agencies is contributing to the staggering bill for fighting the pandemic, which New York has estimated will cost it $15 billion in spending and lost revenue. The bidding wars are also raising concerns that facilities with shallow pockets, like rural health clinics, won’t be able to obtain vital supplies.

As the epicenter of the pandemic, with about 40% of the nation’s coronavirus cases, New York state is especially desperate for medical equipment, no matter what the tab. “We know that New York and other states are in the market at the same time, along with the rest of the world, bidding on these same items, which is clearly driving the fluctuation in costs,” budget office spokesman Freeman Klopott said in an email.

The Office of General Services, New York’s main procurement agency, declined to say which sellers were inflating prices for essential medical gear. “At this moment in time the New York State team is focused on procuring goods and services based on current market conditions,” OGS spokeswoman Heather Groll wrote in an email. “There will be time to look back and pull together info on all this, that time will be when the pandemic is over.”

Swindled workers will be paid after settlement

From AM-NY:

Three Queens construction companies have pleaded guilty to withholding more than $370,000 from 150 workers, according to state Attorney General Eric Schneiderman.

The companies, Lotus-C Corporation of Jackson Heights, Johnco Contracting Inc. of Bayside, and RCM Painting Inc. of Maspeth, failed to provide workers with overtime wages between 2012 and 2017. Additionally, the employers had the workers, who were painters, sign a form stating that they were independent contractors instead of employees, the attorney general said.

The companies also underreported their staff numbers to the state, which resulted in major underpayment of unemployment contributions to the state, Schneiderman said.

As part of their plea deal the owners of the companies have dissolved their offices and are banned for five years from bidding on public works contracts in New York State. They will also pay a total of $371,447.01 for unpaid wages and $359,747.86 in unpaid unemployment contributions to the State Department of Labor, the attorney general said.

Park Service looking to refurbish Jacob Riis Bathhouse

From CBS 2:

With colder weather and the holidays upon us, you may not be thinking about your summer beach plans.

But as CBS2’s Brian Conybeare reported, the National Park Service is.

In fact, the agency is trying to restore the historic bathhouse on Rockaway Beach with the help of private investors.

The iconic bathhouse at Jacob Riis Park in Queens has been virtually abandoned for decades. Built in 1932, the art deco pavilion was a popular summer destination for New York’s working poor and immigrants – with restaurants, a surf shop, and a mile-long white sand beach.

But time, neglect, and storms took their toll.

The Park Service is now looking for bidders to reopen parts of the bathhouse with dining, concessions, arts, and an event space for next summer. But the second floor, which housed a Howard Johnson’s hotel in the 1960s, will obviously take much longer.

The second floor now looks like modern-day ruins, with crumbling ceilings and rotting bathrooms.

Hopefully, less expensive = less ugly

From LIC Post:

Residents of the Hunters Point section of Long Island City will have to wait longer for their public library — perhaps several years.

Groundbreaking for the 21,500-square-foot, state-of-the-art waterfront library was supposed to take place last summer with completion scheduled for 2015, but now the entire project is in limbo.

In a letter to Friends of Queens Library at Hunters Point, Thomas Galante, the beleaguered president and CEO of Queens Library, wrote that the building project was vastly under-budget at $28.6 million with a construction budget of just $23 million. When construction bids came in, they ranged from $33 million to $42 million.

Galante wrote of “the overall complexity of the design and several unique, difficult to source, or expensive to procure, interior and design features.” Celebrity architect Steven Holl’s plans were too elaborate, with features that included a rooftop terrace, gardens and a gallery, he said. If and when the library is built on the parcel of land at Center Boulevard and 48th Avenue, next to Gantry Plaza State Park, it will not resemble the original plans.

In the letter, Galante said there would be significant design changes. Gone is the Geothermal Well system in favor of a more traditional heating and cooling system. The aluminum exterior facade will now be cement and glass and custom interior fixtures are replaced with standard fixtures. In all, the changes save $4.7 million.

The entire project will be open to rebids by “a new and more extensive list of contractors,” Galante wrote.

Arena owners battle on Long Island

From Crains:

Out on Long Island, it is shaping up as the heavyweight bout of the decade—the Knockout in Nassau County. It's a winner-take-all contest in which the prize, potentially worth hundreds of millions of dollars over the coming decades, is the right to rebuild and run the badly faded Nassau Coliseum.

In one corner stands a team captained by Madison Square Garden Co., a squad led by hometown heroes James Dolan and Scott Rechler, aided by MSG Chief Executive Hank Ratner. The Dolans control the island's biggest cable television network and newspaper, while Rechler is the island's largest office landlord. In the other corner is the Barclays Center team. Call them the Brooklyn Globetrotters, coached by developer Bruce Ratner with a bench that includes Russian oligarch Mikhail Prokhorov and Jay Z.

Round 1 in the contest kicked off in May, with the announcement of four bidders, which was narrowed to just two the following month. Final proposals for the 63-acre property in Uniondale were submitted on Aug. 9. Nassau County Executive Ed Mangano is expected to announce a victor any day.

Both sides are aggressively swinging for the prize, which includes a share of ticket sales to events, dinner bills, bar tabs and receipts from the shops that both bidders plan to erect around the arena. The winner will control the property for 20 to 30 years.

Local officials say they are delighted at how the bout has shaped up—especially after two previous taxpayer-financed attempts to revamp the Coliseum went nowhere. Those setbacks prompted the Islanders hockey team to skate off to the Barclays Center, which will be its home as early as the 2014-2015 season.

"We're thrilled we have two industry giants prepared to reinvent the Coliseum," said Mr. Mangano.

For MSG, the contest is an opportunity to add another gem to the crown of its ever-expanding entertainment-venue business, which includes managing Radio City Music Hall, the Beacon Theater and the LA Forum. For Barclays, coming off a blockbuster inaugural year at its downtown Brooklyn arena, winning the Coliseum contract could mark the first step toward the launch of a business that not only competes with the Garden in New York City but around the world.

Crapper for Little Bay Park a long time coming

From the Times Ledger:

Residents of northeast Queens took some comfort in hearing that one long-awaited project at Little Bay Park would be moving forward soon.

In an e-mail to his community last week, Bay Terrace Community Alliance President Warren Schreiber said he was cautiously optimistic to report the city Parks Departments’ intention of breaking ground on a new comfort station at Little Bay Park in March.

“I am hopeful, but also skeptical,” Schreiber said. “I just don’t want to see the community disappointed again if they come up with another reason why the project cannot move forward.”

According to a Parks spokesman, the project should be finished by fall 2014 and will include a new comfort station, trees, plantings, and an expanded 100-car parking lot equipped with the ability to clean and absorb storm water runoff, reducing the burden on the area’s drains. The bidding process for the project is nearly finished and the project’s contracts are awarded, or soon to be awarded, the spokesman said.

Photo from Bayside Patch

Little Bay Park crapper bids due

From Bayside Patch:

The city's Department of Parks and Recreation has begun the bidding process for the construction of a comfort station at Little Bay Park for which Bayside leaders have been calling for seven years, state Sen. Tony Avella, D-Bayside, said.

The agency will pick and vet the winning bidder and construction is expected to begin by the end of the year, the senator said.

The senator secured $1 million for the project four years ago when he was a member of the City Council. U.S. Rep. Gary Ackerman, D-Bayside, also brought in funding for the project, which also involved expanding a parking lot at the park.

The Bay Terrace Community Alliance and Avella held a press conference last year during which they called on the city to get the project underway.

State officials have concerns over Genting

From the Daily News:

The latest plan for the Aqueduct racino is no sure bet, the Daily News has learned.

State Controller Thomas DiNapoli has worries about the latest deal - and he must sign off on it before it becomes official.

"We have not received the contract yet, but we have had preliminary discussions with the lottery about some of our concerns," said DiNapoli spokesman Dennis Tompkins.

Sources said the controller's office is worried that the company picked to run the lucrative video-slots parlor, Genting New York, was the sole qualified bidder to emerge.

DiNapoli's office also raised concerns about Genting's 3% stake in MGM Grand, which works with Pansy Ho - whose father is a Chinese casino magnate with reported mob ties - at its Macao casino.

The State of New Jersey was so uncomfortable with MGM's relationship with Ho that regulators forced the company to sell its share of the Borgata in Atlantic City.

One source said the controller's objections are unlikely to torpedo the project. Tompkins wouldn't comment on the severity of DiNapoli's concerns.

DiNapoli and state Attorney General Andrew Cuomo both must okay the pact that Genting reached with Gov. Paterson and legislative leaders.

Cuomo's office, which is checking to make sure the contract passes legal muster, also has had some questions, sources said.

In recommending Genting, lottery officials hailed the proposal as the best they'd seen in the nine-year slog to launch a racino at the Queens track.

Judge tosses Aqueduct suit

From Crains:

The state will continue with its selection of a new operator for a slots parlor at Aqueduct Racetrack after a judge Thursday dismissed the lawsuit by a former bidder that sought to put a halt to the process.

New York Supreme Court Judge Barry Kramer ruled Thursday afternoon that the state Lottery Division had a rational basis for its decision to deny a license to Aqueduct Entertainment Group (now called Aqueduct Entertainment Co.) and that it did not act in an “arbitrary and capricious” manner.

The decision paves the way for Lottery to continue vetting Genting New York, part of a Malaysia-based entertainment giant, which is the sole remaining bidder in what has been a drawn-out process. Lottery is expected on Tuesday to make its recommendation to state officials on Genting.

The NY Lottery is backing Genting as well. Not everyone is on board, however.

Putting on the glitz at Aqueduct

From the NY Post:

The only horse left in the race to win the multimillion dollar Aqueduct contract has revealed its ambitious design for the racetrack -- a 400,000-square-foot space that includes a high-end restaurant, an event center and even a stage for scantily clad showgirls.

The plans from Genting New York -- the American arm of a megabucks Asian gaming conglomerate -- call for an upscale Chinese restaurant and a football-field-sized space for social functions and corporate events.

Visitors will also get an eyeful of dancing showgirls while they hit the video slots, thanks to a stage set up behind the machines. The company claims it will be prepared to open the new racino -- featuring 4,500 video slot machines -- a mere six months after getting the OK from the state.

The plans submitted as part of the bid -- the only one left after Penn National and the SL Green-Hard Rock partnership were disqualified for not following competition rules -- also include a food court with 450 seats, an outdoor terrace and a 2,200-car parking garage.

The Asian gambling giant is one of the largest casino companies in the world, but has a pretty puny presence in the US.

It's hoping that Aqueduct will change that -- if it comes out on top of what has become one of the most bedeviled bidding wars ever.

Not so fast...AEG is suing.

Genting is last bidder standing

From the Daily News:

In a stunning move, the State Lottery has disqualified two of the three bidders for the ill-fated Aqueduct “racino” project.

SL Green and Penn National Gaming were rejected only seven days after submitting their applications in the latest round of bidding for the long-delayed project.

That leaves just Genting New York in the running.

Genting “appears to conform with all requirements of the bid submission process and will continue to be evaluated,” the Lottery said in a statement.

If Genting ultimately is not approved for the Aqueduct project, the bidding process will have to start again. A recommendation from Lottery is due to Gov. Paterson and legislative leaders by Aug. 3.

Lottery officials said Penn National and SL Green, which was partnering with Hard Rock International and Clairvest Group, did not conform with the set criteria. Both failed to submit signed copies of the mandatory bid requirements.

Instead, the two bidders offered “altered versions” containing numerous changes they wanted.

3 Aqueduct bidders left

From the Queens Courier:

Of the six players tendering $1 million for the right to bid on the Aqueduct Racino...only three remain.

“The following companies submitted proposals to develop and operate a video gaming facility at Aqueduct: Genting New York, LLC; Penn National [and] one group comprised of SL Green, Hard Rock [Entertainment and] Clairvest Group,” Lottery spokesperson Jennifer Givner announced on Tuesday, June 29.

Both Buffalo-based Delaware North, which once had the Aqueduct franchise in its grasp, and Yonkers-based Empire City dropped out of the race to operate the 4,500 Video Lottery Terminals (VLTs) at the South Ozone Park racetrack for 20 years.

Their announcements came within minutes of the 4 p.m. deadline.

And they're off! (again)

From Crains:

A half-dozen entities have thrown their hats into the latest round of bidding to become the developer and operator of the Aqueduct racino. This time around two new players—one from overseas—have emerged.

Empire City Casino-Yonkers Raceway and Genting New York LLC, a Malaysian investment firm that operates casinos overseas, submitted the $1 million refundable entry fee, according to New York Lottery Division. In another surprise, Toronto-based Clairvest Group, which was a partner in Aqueduct Entertainment Group, also submitted a bid.

Earlier this year AEG, the previous winner of the Aqueduct video slot machine contract, was denied a gaming license and the state withdrew its support for the group. There is an ongoing investigation by the state's inspector general into the previous selection of AEG. It was unclear who Clairvest's partners are in the latest bid.

As anticipated, previous losing bidders in the earlier round—Manhattan's largest commercial landlord SL Green, Penn National Gaming, and Delaware North & Saratoga Gaming and Raceway—rounded out the other parties that submitted the entry fee by the June 1 deadline.

Aqueduct, take 3

From Crain's:

Indefatigable bidders are gearing up to participate in the latest of a long-running series of races to become the operator of a lucrative racino at Aqueduct Racetrack in Queens.

More than 120 questions regarding the request for proposal, which was issued last week by New York Lottery, were submitted from five different entities ahead of the Tuesday afternoon deadline, according to a spokeswoman for the Lottery Division. The division, which oversees eight casinos statewide, declined to disclose the identities of the interested bidders. But one of the four losing bidders from the previous round, Penn National Gaming, admitted to submitting questions.

The three other losing bidders were Manhattan's largest commercial landlord—SL Green, Delaware North's Aqueduct Gaming, and The Peebles Corp., which teamed up with MGM Mirage. The Peebles Corp., Delaware North and SL Green all declined to comment.

According to the new RFP, bidders must submit a refundable $1 million entry fee by June 1 to participate in the bidding. All proposals are due by June 29 and bidders are required to make a minimum $300 million upfront payment.

The Lottery Division will score bidders and present recommendations to Governor David Paterson and legislative leaders for final approval. Unlike the previous round, however, sources say Mr. Paterson will be bound by Lottery's pick this time. Assembly Speaker Sheldon Silver and Senate Majority Conference Leader John Sampson will also have to sign off on the recommendation.

New bids sought for Aqueduct project

ALBANY, N.Y. (AP/1010 WINS) -- The Paterson administration is requesting new bids to develop and operate video lottery machines at the Aqueduct Racetrack in Queens.

The New York Lottery says bids will be evaluated based on predetermined public criteria by a committee of lottery and Budget Division officials. The agency plans to make a recommendation to Gov. David Paterson in 12 weeks, with all bids disclosed after that.

In March, Paterson's administration dropped its support for the Aqueduct Entertainment Group to build and operate up to 4,500 video slot machines at the racetrack after lottery officials identified licensing problems for the consortium. It had been chosen by Paterson and legislative leaders from a half-dozen bidders on the racino.

AEG as Aqueduct pick becomes more controversial

From the NY Times:

The Paterson administration has released a confidential document that assessed the various bidders vying for the rights to operate a casino at the Aqueduct racetrack in Queens.

The document, which was prepared by the state’s Division of Lottery last August, was turned over to The New York Times, which sought to obtain it through a Freedom of Information Act request.

The document is likely to raise new questions about why Gov. David A. Paterson and the Legislature selected the Aqueduct Entertainment Group, which does not fare nearly as well in the Lottery Division’s assessment as some of the other bidders. A.E.G., in fact, appears to be the fourth rated among six bidding groups in the running at the time.

Feds talking with losing bidders in Aqueduct probe

From the Daily News:

The feds are trying to get losing bidders in the Aqueduct racino deal to dish about the chaotic process that led to the selection of a politically tied group, the Daily News has learned.

One losing contender said the Manhattan U.S. attorney's office contacted his group this week - the latest twist in the mushrooming scandal.

Prosecutors recently subpoenaed the state Lottery Division for documents related to the Aqueduct project bid process, although aides to Gov. Paterson insist the probe is unrelated to the racino deal.

A spokeswoman for the U.S. attorney's office wouldn't confirm or deny the existence of an investigation into Aqueduct.

From the NY Post:

Paterson's office on Tuesday released documents related to the bid, which showed that AEG initially ranked last in terms of revenue it would generate for the state - but then jumped to first when bids were revised.

One gaming expert told The Post the dramatic change "looked fishy."

Meanwhile, questions were raised about some of AEG's invesment partners yesterday.

The Toronto-based 1X Inc, an online gaming software company, owns 4.4 percent of AEG.

Two of 1X's investors are principals in the Markit Group, which is being investigated by both the US Justice Department and state Attorney General Andrew Cuomo's as part of a larger probe of the credit default swap market.

Markit has denied any wrongdoing.

Paterson picks a winner

From Crains:

Aqueduct Entertainment Group has been selected to develop the racino at Aqueduct Racetrack in Queens, announced Gov. David Paterson late Friday afternoon. But there are some caveats.

The decision ends a drawn out bidding process that began six months ago and has been closed to the public. AEG edged out a team led by SL Green, Manhattan's largest commercial landlord, which at one time was seen as Mr. Paterson's favorite. Three other bidders, Delaware North's Aqueduct Gaming, R. Donahue Peebles/MGM Mirage and Penn National Gaming, also came up empty handed. One other bidder, casino mogul Steve Wynn, last year dropped out of the contest to revive the rundown racetrack in Ozone Park.

“After an extensive review of the five remaining bids to operate the video lottery terminals at Aqueduct racetrack, I have chosen and the leaders (of the state Assembly and Senate) have agreed the organization that best fulfills our selection criteria,” Mr. Paterson said, in a press statement. “All of the groups have valid proposals, but AEG presented a comprehensive bid that enjoys community support and also offers strong marketing appeal.”

According to a statement, Assembly Speaker Sheldon Silver, one of the three decision makers on Aqueduct, agreed with Mr. Paterson's choice. However, AEG's selection is subject to conditions, which includes increasing their upfront licensing fee from $200 million to $300 million. He also noted that the winning bidder and its associates must possess a crime-free record to obtain a state gaming license.

Mob tried to rig DOS bid

From the NY Post:

A city official was accused of bid rigging with his mobster father-in-law after they were captured in expletive-filled secret wiretaps allegedly crafting a deal for a crony to provide barriers for the Department of Sanitation, The Post has learned.

Frederick Grimaldi, the Sanitation Department's deputy chief for equipment and facilities, was caught on tape March 31 providing precise bidding instructions to his wife's dad, Michael Murdocco, a reputed Gambino crime-family soldier.

The suspected insider information was for their friend Vincent Alessi, owner of Duramix Concrete Corp., to use on documents that had to be submitted for the tens of thousands of dollars' worth of city work.

"Maybe tell him $205 and $50 [delivery charge per barrier], 2-0-5 plus 50," Grimaldi says to his father-in-law as they haggle over a figure for Alessi and his New Jersey-based company to bid, according to recordings made by the state's Organized Crime Task Force and obtained by The Post.

"Then I need his information," Grimaldi says, "and then I'll take it from then."

Grimaldi, 44, Murdocco, 64, and Alessi, 42, were charged by the state's Organized Crime Task Force along with 18 other members of the Gambino and Luchese crime families and their associates on a range of charges from loan sharking to bookmaking to bribery last month.

Struggle over Aqueduct honest graft prize

From the NY Times:

...eight years and one recession later, state officials still cannot agree on an operator for the aging track, despite the obvious financial incentive: a refurbished operation with video gambling machines would generate more than $1 million a day, many experts say.

The latest round of talks has been stalled for months, and despite a series of meetings among Gov. David A. Paterson and legislative leaders to try to resolve the matter, they remain deadlocked. The pressure is on state lawmakers, who have already included a $200 million upfront payment from the winning bidder in their plan to reduce a multibillion-dollar budget deficit.

The problem is that the governor and the leaders of the Assembly and the Senate must agree on the winning bid.

The governor’s office appears to favor a group led by SL Green Realty, Manhattan’s largest commercial landlord, and Hard Rock International, or maybe Delaware North.

The Senate, which would have to approve the selection, has expressed enthusiasm for Aqueduct Entertainment Group, even though some advisers say it is one of the weaker of the six bidders. The Assembly, in turn, has not shown a preference, although Speaker Sheldon Silver is thought to favor Delaware North or SL Green.

Given the history of tortuous and interminable negotiations over selecting an operator — symbolizing the worst of Albany’s dysfunction and backroom political horse trading — no one is expecting a quick compromise.