Thursday, September 07, 2006

Records of Menendez Rental to Nonprofit He Federally Aided, Are Subpoenaed by U.S.Attorney in NJ -- Ghost of Torricelli?

WNBC in New York broke the story early Thursday evening (09-07), that federal officials from the U.S. Attorney's Office in New Jersey have subpoenaed records related to the questionable rental arrangement between then-Congressman Robert Menendez (D-NJ), and a nonprofit organization located in Hudson County, NJ, the North Hudson Community Action Corporation (NHCAC). Menendez is the Hudson County-based Democrat candidate for the United States Senate this year, having been appointed to the seat for the remainder of the year by former Senator Jon Corzine, who was elected Governor of New Jersey last fall.

A federal investigation has been launched into the financial dealings of New Jersey Sen. Robert Menendez and a nonprofit agency he has helped over the years, sources said.

The U.S. attorney's office has subpoenaed the agency's records pertaining to a house once owned by then-congressman Menendez, sources told NewsChannel 4's Brian Thompson.
U.S. Senate seat in NJ in the balance:

Menendez is running for the Senate seat as the Democrat candidate this fall, against Republican State Senator, Tom Kean, Jr., a son of the former New Jersey governor, who more recently served as the Chairman of the 9/11 Commission.

The younger Kean has repeatedly raised ethics as a key issue in the campaign, branding Menendez as a political boss of the old Hudson County school. Recent polls have showed Kean edging ahead of Menendez in this otherwise heavily Democrat-leaning State. The recent poll trend was clearly pointed out by EnlightenNJ, a hard-hitting political blog in the Garden State here.

NHCAC is headquartered in Menendez's hometown of Union City, in a building that Senator Menendez himself owned until he sold it in May of 2003. NHCAC rented space in the three story brick building for years, for which they paid over $3,000.00 a month to Menendez and his former wife. Menendez claims the rent was low. Five years ago, the organization declared then-Congressman Menendez their "Man of the Year."

The Star-Ledger, one of the state’s leading daily papers, also reported the stunning news of the subpoena last evening, noting that they were served earlier in the week. When the Star-Ledger initially broke the story of the seamy relationship itself two weeks ago on August 25th, they pointed out that the organization had paid the then-Congressman over $300,000.00 in rent over nearly a decade, starting back in 1994, and lasting until he sold the property three years ago. All the while, he was assisting them in obtaining millions of dollars in federal funding for their various programs.

Free-fire in media about NHCAC & Menendez:

Menendez quickly tried to claim that he broke about even on the deal, but EnlightenNJ quickly debunked that absurd claim. In addition to the substantial rent he garnered over the years, Menendez sold the property for $450,000.00 in 2003, having originally purchased it in 1983 for $92,000.00.

Menendez, a lawyer, also alleged he had received "verbal" approval for the rental arrangement from the House Ethics Committee, a real flag-raiser which we previously noted on EnlightenNJ.

Recently, an influential columnist for the Record, Mike Kelly, wrote a hard-hitting column for the large circulation Bergen County paper, one which raised serious questions about the arrangement, and must have sent shivers through the Menendez campaign. Suburban Bergen County, which rings cross-river neighbor New York City, has the largest population of any county in the State, and is a must win in the U.S. Senate race.

And a columnist for the Star-Ledger, Paul Mulshine, meanwhile did a little digging, has made a pretty persuasive case, based on actual old comparable rental ads in the papers, that Menendez had been charging NHCAC rent at a premium.

New Jersey Assemblyman Michael Patrick Carroll (R-Morris), who maintains an active blog, posted a few commentaries as well regarding the Menendez rental deal, one here , and an earlier one, here.

Hudson politicians complete "take over" of NHCAC:

Salaries at the nonprofit also run unusually high, with the President of the organization pulling down an eye-popping $185,000.00 a year. And strong indications are that good old fashioned Hudson County politics played a very big part in the replacement of the recently deceased President of NHCAC, Michael Leggiero, as pegged by this Jersey City Reporter article in which the reporter, Jessica Rosero, noted that the local pols would get together to pick Leggiero’s successor for the plum job. The interim appointee had been Leggiero's hand-picked successor, Michael Shababb, the Chief Operating Officer (COO) of NHCAC, and a resident of Bergen. But rather than ratify that initial choice, Shababb was given a fat raise of $12 K, and sent back to continue in his old job. The new CEO (scroll down) turned out to be a Ward Councilman from Menendez’s Hudson home town, Union City, one Christopher F. Irizarry, who is -- or was -- also the Secretary to the Union City Board of Education, and a Menendez confidant. That organization has recently been mired in controversial questions about patronage that have surfaced in testimony at legislative hearings about property tax issues.

NHCAC receives much of their funding in the form of a community "action," or, community services block grant, which is federal funding that is passed through and overseen by a recipient State, in the case of New Jersey, by the Department of Community Affairs, under the Division of Community Resources ( DCR). Menendez helped them obtain and maintain that block grant, and other federal funding, and he apparently assisted them in a number of ways over the years while a member of the House of Representatives. NHCAC is also one of 23 "designated" community action agencies in the State of New Jersey.

From the start, Menendez has maintained that he had sought and received approval from the House Ethics Committee for the rental arrangement, but, as noted above, continues to claim he did not get the approval in writing. Two Republican state legislators filed an ethics complaint against Menendez with the U.S. Senate last week over the arrangement.

As stated in tonight’s Star-Ledger article, Menendez is, not surprisingly, also questioning the timing of the probe.

Menendez’s spokesman said tonight that the senator has nothing to fear from the investigation, and questioned the timing of the action by the U.S. Attorney’s office, considering the election is two months away.

"This transaction was already approved by the House Ethics Committee, and the U.S. attorney will find that Bob Menendez did nothing but support a well-respected agency in the exact same manner that he has supported other non-profits in the state," Miller said.

Perhaps more trouble for Bob to come:

WNBC also reported last evening that another New Jersey legislator, Senator Diane Allen (R-Burlington) will charge Menendez with another ethics violation next week for attempting to block a merger involving a company in which he owns stock. As their story stated:

State Sen. Diane Allen, R-Burlington, said she planned to file a complaint with the Senate Ethics Committee early next week.
. . .

Allen alleges that in 2003, Menendez sponsored legislation to ban media mergers he said would create monopolies in Spanish language broadcasting. Allen alleges Menendez wanted the merger to fail because his stock would have gone down. The merger ultimately went through.

"Ethics rules say you cannot lobby on behalf of organizations when you stand to make some money by it," Allen said. "I fear that Sen. Menendez has trouble discerning that line between what is ethical and what is not."

Folks are beginning to ask, is this the Ghost of Torricelli Past?


At 6:17 PM, September 08, 2006, Blogger Enlighten-NewJersey said...

As it happens, the “verbal approval” Menendez supposedly received came from the Ethics Committee lawyer, who continently for Menendez, is dead.

“Menendez has said he obtained verbal clearance from the House Ethics Committee in 1994 before entering a lease agreement with the organization. After his speech, Menendez said he obtained the clearance from Mark Davis, who served as the committee's counsel. Davis died last year.”

At 6:44 PM, September 08, 2006, Blogger Trochilus said...

Ahhhh . . . this is but one of many reasons for the common sense wisdom that holds an oral agreement is worth the paper it's written on. And, what a disappointment that we're denied the opportunity to gamely attempt to follow the trail of tortured logic on which such an opinion would have to have rested!

Perhaps Menendez was coincidentally absent from class on the day(s) that little pearl of wisdom was imparted by one or more of his law professors.

At 2:02 PM, September 10, 2006, Blogger Trochilus said...

Whoops! On Sunday, September 10th, the Washington Correspondent for he Star-Ledger, Robert Cohen, reported that Bob Menendez’s first cover story has fallen apart, via EnlightenNJ.

Though Mark Davis died last year, and, therefore, was not in a position to challenge Menendez’s earlier claim that he [Davis] was the guy who gave Bob the verbal ethics okay on the NHCAC lease deal back in 1994, the Star-ledger noted that "Roll Call, a Capitol Hill publication, said Davis left the ethics committee in 1993."

That would have been a year before Bob would have supposedly popped the big question to the Committee's Counsel. Damn those timelines!

So, the next step would seem to be for a reporter with a little moxie to actually ask Bob Menendez a tough question about this whole thing.

For example, one could ask him something like this:

"Well, Senator, if you now admit, as reported in the Star-Ledger, that your recall as to who gave you the advice was faulty "working on a recollection from 12 years ago" why should anyone accept your insistence that you actually asked anyone at all for the advice?"

"Isn't it at least as credible, Senator, that you just thought about asking for the advice, and then perhaps thought better of it when you started actually browsing through the House Ethics Rules?"

"You follow me, Senator? . . . Senator?"

At 7:12 PM, September 10, 2006, Anonymous Anonymous said...

lay off menendez before the dems pull him from the ticket, get approval from the supreme court, and the democrats name Andrews or Pallone to replace.
Let Menendez lose all by himself.

At 3:53 PM, September 12, 2006, Anonymous Anonymous said...

Warning to all who come in contact with Menendez between now and election day...don't die. Otherwise you stand a strong chance of becoming Senator Bob's next allibi/character whitness!

But there is a solution. Let's all amend our wills with a clause repudiating Senator Bob.

By the way, It's odd that the North Hudson Community Action Program people are active political hacks with government jobs. Usually CAP employees come from the private non-profit world. Comparisons would be usefull with other programs.

At 11:38 AM, September 13, 2006, Blogger J. Joseph Rivera said...

I believe that in the event that Boss Bob drops out of the race, Rob Andrews is the clear frontrunner to replace him on the ticket. Reason being that he is unopposed in his Congressional race and was a frontrunner on Corzine's replacement list.

The only reason I don't make Dick Codey the frontrunner is because he has no money to run a national campiagn and the the DSCC would have to foot the bill.

I don't rule it out entirely however. Scott Rasmussen said on the Sean Hannity Show yesterday that the New Jersey race is the most important and pivotal race in the country and if the Democrats lose it, they will NOT be able to regain control of the Senate. If the Democrats are that desperate, I can see them putting all of their eggs in Dick Codey's basket.

At 2:36 PM, October 01, 2006, Anonymous Anonymous said...

I was just wondering if Bob Torricelli is available to replace Menendez. After all he got a raw deal when he was replaced and his problems are probably all forgotten by this time.

At 3:33 PM, October 01, 2006, Blogger Trochilus said...

Well, probably not. A few weeks ago, the Torch was quoted saying something along the lines of he didn't understand the voters any more.

Of course, "raw deal" is hardly a appropriate way to describe what he got -- we assume that was sarcasm on your part -- but for a replacement to appear, Menendez would have to agree to drop out.

The way Steve Kornacki summed it up in in a recent New York Observer piece, was,

Jersey Democrats, for now, aren’t holding their breath.

As one put it: Mr. Torricelli’s ego couldn’t stand losing an election; Mr. Menendez’s, apparently, can.

Of course, the Torch could put on a good act when he wanted to.

Sure, he cried when he dropped out, but when the Supreme Court ruled with the Democrats (October 2, 2002) and allowed Lautenberg on the ticket, the Torch and Jon Corzine were seen celebrating and high-fiving that political "victory" together in a Lambertville, NJ bar that very evening.


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