Today’s news:

Cut! Paterson freezes funds for Vito’s charity

The Brooklyn Paper

Gov. Paterson has halted $25 million in state contracts due to a Bushwick-based nonprofit affiliated with embattled Assemblyman Vito Lopez — a move that could financially cripple an organization that provides services to more than 6,000 Brooklyn residents.

Paterson last week ordered all his commissioners to hold payments for all “existing and pending contracts” with the Ridgewood Bushwick Senior Citizens Council and its subsidiaries.

Paterson spokeswoman Jessica Bassett said that “there could be a disruption in services [provided by Ridgewood Bushwick], but due to the serious allegations and investigations, we felt it was prudent to put a hold on the contracts.”

The governor’s budget office did not set a timetable for lifting the funding freeze, but said that the contracts would be suspended until the conclusion of two ongoing federal investigations currently probing the relationship between Ridgewood Bushwick, Lopez, and for-profit real estate entities in Brooklyn.

Lopez, who is beginning to undergo treatments for a recurrence of cancer, did not return calls for comment.

The governor’s decision roiled state Sen. Martin Dilan (D–Bushwick), one of Ridgewood Bushwick’s strongest supporters, who called Paterson and demanded an explanation for why the nonprofit was suddenly being forced to jump through “a litany of hurdles” that could further delay much-needed social services to his constituents — not to mention paychecks for its 2,000 employees.

“[If the government] withholds money, it puts the agency in a precarious situation where they have to borrow money to meet payrolls,” said Dilan. “We’re at risk of losing an agency that has provided excellent services and has providing housing to the community. If we lose all this, Bushwick may never ever be able to get these kind of resources again.”

The state’s move comes less than two weeks after the city placed a hold on $12 million worth of contracts to Ridgewood Bushwick pending review of an audit the nonprofit submitted to Attorney General Andrew Cuomo.

Ridgewood Bushwick’s financial records first piqued the attention of city investigators, who found that two employees at a community center falsified attendance records and submitted phony bills to several city agencies earlier this year.

This summer, the city’s Department of Investigation expanded its inquiry into the nonprofit’s activities finding that its board members did not have basic knowledge of its finances but rubber-stamped the enormously high salaries of its top two executives, Angela Battaglia and Christiana Fisher, which increased 182 and 73 percent from the previous year.

Both women have been criticized for pulling down six-figure salaries at a nonprofit whose mission is to “eliminate poverty” in Bushwick.

Lopez, who was not the subject of the investigation but maintains close ties to Ridgewood Bushwick and its employees, has repeated publicly that the nonprofit does good work in the community.

The effects of the investigations and the state’s contract halt on Ridgewood Bushwick’s long-term financial health could be perilous, says Baruch College professor Nicole Marwell.

“If you’re lucky enough to have enough liquidity to dip into, you can cover it in the short term, but nonprofits like Ridgewood Bushwick don’t have a lot of reserves,” said Marwell. “It will have an effect on delivery of programs and jobs in the organization and its ability to deliver programs and jobs in Bushwick in the future.”

Updated 12:24 am, October 6, 2010: Adds a new quote from the governor's spokeswoman.
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Mike from Park Slope says:
How unfair, the residents of Bushwick, and the employees of RBSCC and their families are the only ones that will suffer as a result of this sanction. Why punish programs that have done nothing wrong and that have lived up to the terms of their contracts with the State?

Not only are many of these programs the best in NYC, not only do they provide emergency services that keep families out of shelters, children in school and seniors in nursing homes from falling ill, but no one else provides these services. In North Brooklyn, residents receiving aid from RBSCC now that have to be told to go elsewhere will not receive any other support because there is nowhere else to go. How sad.
Oct. 1, 2010, 6:28 am
Mike from Park Slope says:
Just to clarify: residents of Bushwick and the surrounding areas told to go to other agencies in other parts of Brooklyn for assistance will find that many of these agencies are working at capacity and cannot take on this added load. Many of these former RBSCC clients will then be left without any assistance, meaning that families will go into homeless shelters, homes will go into foreclosure that might have otherwise been saved, etc. Add to that the RBSCC employees that will be unemployed and this is clearly a disaster for Bushwick.
Oct. 1, 2010, 6:33 am
Ridgewood from Bushwick says:
While it's unfortunate that innocent elderly and employees will suffer, you surely can't expect the state to continue funneling money to an organization that is proven to be rife with fraud and suspicious accounting. The state has to do its due diligence to protect taxpayer funds from being misused.
Oct. 1, 2010, 7:17 am
Mike from Park Slope says:
Rife with fraud? Nonsense. The Dept. of Investigation year long audit found that one senior center, representing less than 1% of total funding, had problems. This is election year politics at its worst. The state should resolve this as quickly as possible.
Oct. 1, 2010, 7:41 am
Greg from Greenpoint says:
These organizations shouldn't receive another dime of taxpayer money until Battaglia and Fisher are fired, at a minimum. The gigantic salaries they make are a total disgrace.
Oct. 1, 2010, 12:24 pm
tartan from greenpoint says:
If RBSCC goes down, so be it. We're not just talking about corruption on the part of Vito, his girlfriend and their cronies. Many if not all of RBCSS's employees have witnessed numerous frauds and have looked the other way, even if they haven't directly participated. They've been giving salary kickbacks to campaigns and doing other stuff under Vito's orders and they know what has gone on. They're just as guilty of hanging around to milk the system as Vito. Bushwick deserves better. Let them all rot and let all that government funding go to deserving and ethical nonprofits.
Oct. 1, 2010, 1:21 pm
Mike from Park Slope says:
Tartan, that's nonsense. You have no idea what you're talking about. RBSCC is a great organization, and it does amazing work helping thousands of people. Whatever your agenda is, understand that this move only hurts innocent people.
Oct. 1, 2010, 2:33 pm
Ger from Crown Heights says:
Where were these friends of the poor when RBSCC gave raises over half a million to part-time employees who were "coincidentally" friends of Vito? Those funds could have been used to provide the services that they were caught fraudulently faking. I'm friends with several of their employees who all admit that RBSCC employees are required to work for Vito Lopez and any candidate that Vito backs. The fraud uncovered already is the tip of the iceberg. It's only been Vito's patronage deals that have diverted so much funding to the service, funding which would have gone (and hopefully now will go) to non-profits that aren't corrupt patronage mills.
Oct. 1, 2010, 5:11 pm
stan hope from williamsburg says:
i may not know much about politics, but i do know that vito passed the loft law that has immediately impacted on my housing situation and that of my neighbors. he is a hero and the only county leader ever who is also a champion in the world of housing policy.
Oct. 2, 2010, 9:53 pm
Lisa from Williamsburg says:
The ODA at 12 heyward St Brooklyn NY lists its president as Zvi Kestenbaum pays himself just from the Health program evey year $415,970 Plus he also gets a similar amout from the weatherization program . His son is listed as CEO Louis Kestenbaum an indicted felon pays himself a similar amount. Zvi Kestenbaum is fully senile, he has no idea if its day or night and he gets all this money . Its a scandal of epic proportion. This information is public its all available for free on Guidestar.Com
Oct. 3, 2010, 8:50 am
tartan from greenpoint says:
Stan Hope: We can have legislators who do the right thing WITHOUT ripping off taxpayers, committing election fraud, and rigging our political system. Think bigger!
Oct. 5, 2010, 11:34 am
Mike from Park Slope says:
Lopez hasn't ripped off anyone, and he hasn't committed election fraud. Nothing in this article or in any other article even alleges that he has.
Oct. 5, 2010, 9:49 pm
tartan from greenpoint says:
That is true about the article. But ...the investigations are just getting started. The people in the community have talked about Vito's multiple kinds of fraud and kickbacks for years. It's an open secret and JOKE punchline in Brooklyn that everyone talks about. How sad for us all.
Oct. 5, 2010, 11:25 pm
Pacholo from RedHook says:
Vito's people register any warm body to vote with a little promise of an apartment.
Oct. 6, 2010, 7:05 pm

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