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Months after landing its first job in nearly a decade on the New York City subway, a Long Island construction firm hosted an intimate fund-raiser in its luxury suite at Citi Field for a special guest: Gov. Andrew M. Cuomo.
The firm, Haugland Group, had wanted to expand into the lucrative world of contracting for the Metropolitan Transportation Authority, the agency that oversees the subway and is controlled by Mr. Cuomo.
After securing a $23 million contract to clear clogged subway drains in October 2017, William Haugland and his son Billy, the company’s leaders, sought to raise as much as a quarter of a million dollars for Mr. Cuomo’s re-election campaign at the Citi Field event, according to a person with direct knowledge of the event.
Neither the family nor their companies had ever donated to Mr. Cuomo before.
Haugland Group was suddenly one of Mr. Cuomo’s largest contributors as he ran for a third term. But it was hardly alone. Mr. Cuomo has raised millions of dollars from companies that work for the transit agency, benefiting from the fact that New York does not limit donations from contractors that do business with state entities.
As the subways have struggled in recent years, Mr. Cuomo has lashed out at the consultants and construction firms that have multimillion-dollar contracts with the agency, dubbing them the “transportation industrial complex.”
Yet the governor does not mention his own deep ties to some of the firms.
Since Mr. Cuomo took office in 2011, his campaigns have received more than $3 million from M.T.A. contractors and industry groups that represent them, according to an analysis by The New York Times. Donors with ties to the M.T.A., including board members, their employers and transit unions, have donated another $1.5 million.
Mr. Cuomo has raised about $88 million in total since 2011, according to campaign filings.
The companies write checks to Mr. Cuomo’s campaign and have attended his lavish fund-raisers. Executives from WSP, a major construction management consultant, were at Mr. Cuomo’s 2017 birthday fund-raiser in Manhattan where former President Bill Clinton and the singer Jon Bon Jovi headlined.
Another firm that cleared subway drains, Welkin Mechanical, also donated to Mr. Cuomo. The campaign received the contribution less than three weeks before the company won a nearly $15 million contract in November 2017.
Welkin Mechanical did not have enough equipment to finish the work, so it borrowed some from a third company that was hired to fix drains, National Water Main Cleaning, which did not donate to Mr. Cuomo. Haugland Group used a subcontractor, WRS Environmental Services, to help conduct the work.
The drain work was part of an emergency push to repair the ailing transit system. Subway officials said it is common for firms to hire subcontractors to provide additional equipment and workers, and it was necessary in this case because there was so much work to do.
In an interview, Mr. Cuomo said he had no role in choosing M.T.A. contractors and those decisions were not influenced by political donations. Asked why his campaign accepted donations from a group he has derided, Mr. Cuomo said not all contractors were problematic.
“I don’t even see the names of the contractors,” Mr. Cuomo said. “I don’t know who the hell is a contractor at the M.T.A.”
At least a dozen states, including New Jersey and Connecticut, have placed some limits on political donations from companies seeking or winning state business. New York has no such rules. A bill to add restrictions failed earlier this year.
There is no evidence that the M.T.A. awarded contracts as a reward to Mr. Cuomo’s donors, but people in the industry see political contributions as important for their business.
Marc Herbst, the head of the Long Island Contractors’ Association, said he regularly receives invitations to attend fund-raisers. He said he encouraged firms that want to give to do so for the greater good of the industry, not to get a particular job.
“You’re being noticed and showing your appreciation,” Mr. Herbst said.
Mr. Cuomo said he supported restrictions on contributions from companies that do business with the state as long as legislators were also included. He has proposed laws that would impose such limits. But he said extending them to public authorities like the M.T.A. was complicated because their oversight was more tangled and they had many contractors and vendors.
“There would be nobody left,” the governor said, adding that “if you included employees, you wouldn’t be able to take a $100 contribution from a stewardess,” because airlines do business with the Port Authority of New York and New Jersey, a public agency.
At the Mets fund-raiser, Mr. Cuomo talked subways with the small group brought together in the Haugland suite. At least three contracting firms with M.T.A. work were represented, according to a person with knowledge of the event.
“We spoke a little bit about subway problems,” one attendee, Michael J. Rodgers, the chief executive of WRS Environmental Services, said of his conversation with the governor. “He said he was committed to making it as good as it can be.”
A cash cow for firms — and the governor
With an annual budget of $16 billion, the transportation authority oversees the region’s sprawling network of subways, buses and two commuter railroads.
It relies on outside contractors for major projects, from building new subway lines to repairing tunnels. Other governors have also reaped campaign cash from M.T.A. contractors.
Mr. Cuomo has received donations from executives and limited liability companies tied to M.T.A. contractors such as Yonkers Contracting, which helped build the new Hudson Yards station in Manhattan, and HAKS Engineers, Architects, and Land Surveyors, a consultant working on subway station renovations. Thomas Iovino, a donor and founder of a major M.T.A. construction firm, Judlau, made so much money that he bought singer Billy Joel’s former Hamptons home for $19 million.
Asked about those donations, Mr. Cuomo pointed to a new requirement that the M.T.A. ban contractors whose projects run over-budget or are delayed. He said he would not accept money from those companies.
“I do condemn the bad ones,” he said. No company has been debarred yet, according to an M.T.A. spokesman.
Dani Lever, a spokeswoman for Mr. Cuomo, said many M.T.A. contractors who donated to Mr. Cuomo gave before he was governor and had oversight at the agency. The firms also work for other state agencies, like the state transportation department, she said.
Ms. Lever criticized The Times for including all M.T.A. contractors in its analysis of Mr. Cuomo’s donors, including financial institutions and alcohol companies that work for the agency.
“These are long-term supporters of the governor having nothing to do with the M.T.A.,” Ms. Lever said.
A new donor makes a splash
Haugland Group has been growing so quickly that, after moving into a new headquarters in suburban Long Island, employees recently had to park in the mud because the parking lot remained unfinished.
William Haugland, its chief executive, started his career as an electrical lineman. He is a major player in construction in New York, with government work from Kennedy International Airport to the Long Island Rail Road.
Mr. Haugland’s companies and his family have long contributed to New York politicians, mostly Republicans, including at least $43,000 to Edward P. Mangano, the disgraced former Nassau County executive, and $25,000 to former Gov. George E. Pataki.
But 2018 was by far their biggest year as donors, and the greatest beneficiary was Mr. Cuomo, whom they were supporting for the first time.
The contributions came as company leaders were pressing to get work from the transit agency, according to a company official. In October 2017, the firm won a contract to work underground on the subway tracks fixing drains.
Marissa Slattery, a spokeswoman for Haugland Group, said the company had decades of construction experience and a history of bipartisan political donations.
“Haugland Group supports Governor Cuomo because of his programs to rebuild and improve our region’s infrastructure,” she said in a statement, adding, “They have never asked Governor Cuomo for help in securing business.”
Matthew Barbara, a Long Island recreational boat retailer who was a mutual friend of the governor and the Haugland family, connected them and suggested the fund-raiser, according to Gita Tiku, Mr. Cuomo’s campaign finance director.
Last year, on June 25, the Hauglands hosted the governor at Citi Field.
The luxury stadium suite was not crowded, offering plenty of space to move between outdoor seats — to watch the Mets play the Pirates — and the food inside. The attendees included Rocco Trotta, the chairman of LiRo Group, a construction management firm that is working on the M.T.A.’s East Side Access project. Mr. Trotta did not respond to requests for comment.
Mr. Cuomo arrived with an entourage of security and staff members, and stayed for about 30 minutes, two attendees said.
The Mets lost, but the Hauglands made a good impression: Their companies made a series of contributions totaling $188,000, campaign records show. Other donors at the fund-raiser gave at least $14,000.
Ms. Tiku said there was “nothing unique” about the event and that it had nothing to do with the M.T.A. contract.
An influx of money to fix the system
Haugland’s subway drain contract came as part of a state of emergency declared by Mr. Cuomo in the summer of 2017 as the system reached a point of crisis. The emergency declaration has been extended at least through this month.
The transit agency normally chooses the lowest bidder in a competitive process. The agency’s board must approve many larger contracts at public meetings, where there is often a spirited debate.
Under the emergency order, M.T.A. procurement officials often picked firms in an “informal competition,” according to agency documents. For the drain work, they identified more than three dozen companies in the field through “market research,” and 10 were interested. Instead of voting on the contracts, the board was notified months later about the three winners.
Ms. Lever and subway officials defended the selection of a Haugland subsidiary, Grace Industries, to clear subway drains, saying the firm had previous experience clearing drains and had done extensive work for the state transportation department. A spokesman for the authority said that neither the governor nor his staff members were involved with the decision.
The agency spent a total of $100 million clearing drains. Current and former subway officials say the drains were not an urgent problem and the cost was excessive.
“It’s good to go through the system and clear the drains, but it’s not an emergency,” a former top subway official said, speaking on the condition of anonymity for fear of retaliation. “It’s a regular part of maintenance. I’m not sure how you could even spend $100 million just on drains.”
The authority’s former chairman, Joseph J. Lhota, defended his decision to focus on drains because having water on the tracks delays trains. He said the “amount of gunk that was in there had become like concrete.”
The number of subway delays related to water on the tracks dropped after the drains were cleared, to about 2,300 last year from more than 4,000 in 2017, according to the authority.
Even as the subway gets better, Mr. Cuomo has extended the emergency order at least two dozen times — one of the longest emergency orders in the last two decades besides those that followed Hurricane Sandy and the Sept. 11, 2001, terrorist attacks.
“Especially now that the subway system has clearly improved, I don’t see the rationale for its continuation,” Carl Weisbrod, a former board member, said of the emergency order.
Mr. Cuomo said the emergency order was needed to expedite subway repairs and that it should continue as long as the transit agency wants to use it. Subway officials said they have mostly stopped relying on the order for contracting.
Another emergency priority was a $16 million effort to “deep clean” 106 stations to make them less grimy. Grace Industries, the Haugland subsidiary, and Welkin Mechanical again won contracts.
Legislation to limit political contributions from state contractors has been introduced repeatedly in Albany, but has never become law.
State lawmakers and Mr. Cuomo did take a significant step this year by closing a loophole that allowed companies like Haugland Group to make large donations through limited liability companies, whose ownership can be hard to trace.
That does not go far enough, said State Senator Zellnor Myrie of Brooklyn, who sponsored legislation last session to limit contributions from state contractors. He said the bill was meant to include public authorities like the M.T.A., though there had been debate on that point. The governor’s office said it did not believe the measure would have covered the M.T.A.
“The perception of corruption and pay-to-play is enough to have a corrosive influence on the process,” Mr. Myrie said.