A close-up look at NYC education policy, politics,and the people who have been, are now, or will be affected by acts of corruption and fraud. ATR CONNECT assists individuals who suddenly find themselves in the ATR ("Absent Teacher Reserve") pool and are the "new" rubber roomers, and re-assigned. The terms "rubber room" and "ATR" mean that you or any person has been targeted for removal from your job. A "Rubber Room" is not a place, but a process.
In late June, Al Sharpton and four citywide candidates—Bill DeBlasio, John Liu, Scott Stringer and Letitia James—led a demonstration in Bill Thompson’s home territory, the Bed Stuy section of Brooklyn, where he lived all his life until 2004.They were protesting the mismanagement of Interfaith Medical Center, the last remaining hospital serving the neighborhood. Interfaith had filed for bankruptcy months earlier and was still run by managers from the company, Kurron Shares of America, that had led the death march.
Had Thompson come, he would have been protesting against his own one-time business associates. In 2010 and 2011, as the hospital plunged toward bankruptcy, Thompson was serving as a paid member of the advisory board of a Kurron sister company, working intimately with the owner – a man named Corbett Price who’d been his friend since the 1990s andwhose family, employees and firm have donated nearly $20,000 to Thompson campaigns, starting with his first race in 2001.
During that time, Kurron and Price have cut a trail of financial and medical mismanagement, run-ins with regulators and public controversies – not least repeated clashes with healthcare unions – up and down the Eastern Seaboard.
Asked by WNYC on Thursday about his involvement with Price, Thompson said he had “nothing to do with Kurron, nothing to do with their business, nothing to do with their company, period.” He said that he served about six months on an advisory board for Price as he attempted to start up a private equity fund. As for the fate of Interfaith Medical Center, Thompson said he has been part of the fight to keep the hospital open. “I firmly believe that Interfaith needs to stay open, period,” he said. “It is important to that neighborhood.”
Price, right, would not directly answer questions about his arrangement with Thompson, but his explanation paralleled Thompson’s. “His work for Kurron Capital was to guide us on shifting to become a private equity firm. He wasn’t involved in the operations of the company on health care, consulting or restructuring,” Price said. A Kurron intimate explained that Price’s general counsel, Pam Bradshaw, worked directly with Thompson, who functioned “more as a consultant,” advising Kurron on the “pursuit of private equity opportunities.” All the Kurron companies had a single shareholder, Price, and shared an office on Third Avenue.
Just how much Thompson has been paid by Kurron isn’t clear. The disclosure form he filed with the state as chair of the Battery Park City Authority says he was a paid member of the advisory board of Kurron Shares, a sister company to Kurron Capital, Interfaith’s management company, in 2010 and 2011. The state form doesn’t list his earnings, stating only that Kurron was a source of income over $1,000. Another disclosure form, which mayoral candidates filed with the city last week, contained no reference to Kurron, indicating Thompson’s advisory service ended in 2011.
The extent of the relationship would be more apparent if Thompson joined his fellow Democratic candidates for mayor by fulfilling a pledge to make public his tax returns. Early this year, he released his 2012 tax returns, but he has refused to release his 2010 and 2011 filings, which would list his Kurron earnings. He is the only Democratic candidate for mayor who’s only released a single year’s return, even while Scott Stringer is making repeated demands that fellow comptroller candidate Eliot Spitzer make five years’ returns public.
In 2012,Thompson appeared on NY1and host Errol Louis, pointing out that all his opponents had already released their returns for years, asked why he was the only one who hadn’t. A smiling Thompson replied that he would “probably release all four years of them next year, in a campaign year,” rather than “deal with things one at a time.” Over a week of daily calls to Thompson's headquarters, press officer John Collins repeatedly promised them, at one point even describing how they could be viewed at the campaign office. In the end, the campaign never supplied them.
Ties to Kurron are hardly something the average office-seeker would brag about.
WNYC asked an intern new to New York to do a Google search of Kurron to see how quickly she hit negatives.It took a minute. In three minutes, she read an abstract that “criticized Kurron for reducing medical care” at Interfaith and “later earning a surplus of $8.6 million.”
He tried twice to return to Prince George’s—seeking to buy it in 2003 , and failing that seeking a big consulting contract then and again in 2007 and igniting controversy each time. When county officials withheld millions in subsidies in 2003 that were due the hospital unless they hired Price, the hospital management went to the state attorney general, who conducted a six-month probe of the politicians’ demands before concluding there was no crime. In 2007, when county officials repeated the same public demand for a Price contract in exchange for releasing committed millions of county aid, The Washington Postwondered why Price met such vocal opposition and answered its own question: “Why? Because he has several decades of history tangling with the hospital workers.” A top Maryland union leader, Quincey Gamble, branded him a “slash and burn” villain; the county executive said to favor Price is now in jail, convicted on unrelated corruption charges.
The union hostility continues to this day. Just a few months ago, New York’s hospital workers union, Local 1199, joined the New York State Nursing Association inbriefsfiled in the Interfaith bankruptcy case objecting to Kurron’s latest contract there and charging that Price was a shadow manager consuming grand fees without even visiting hospitals where he was listed as CEO. At the time, Thompson was aggressively seeking 1199’s mayoral endorsement, which he ultimately did not get. But he has received the backing of many city unions, including the United Federation of Teachers.
But the shadow over Kurron hardly ends there. The New York State Department of Health cancelled Kurron’s contract with Interfaith, pictured left, in April, after sending four blistering letters to the company, including charges that bonuses paid to Kurron executives were “contrary to law” and contending that “the reasonableness” of Kurron’s overall fees could not be determined. At the time of Interfaith’s bankruptcy filing, its liabilities exceeded its assets by $200 million after nearly 20 years of Kurron management. The demise wasn’t just financial; a court-appointed patient care ombudsman found the hospital’s emergency department “more chaotic and disorganized” than others he’d observed, noting that “there did not appear to be a coherent process of triage and patient management.”
This week, the health department rejected a reorganization plan proposed by Interfaith’s current managers – a team of former Kurron executives stripped first of Price and then of a long-time Kurron executive, Luis Hernandez, who quit the day of the June protest, a departure that one protest organizer, Robert Cornegy, credited to “pressure from the community.”The state now has asked Interfaith to submit a plan for its closure– part of a dramatic consolidation of healthcare services in Brooklyn that has nearby Long Island Community Hospital almost emptied.
While the collapse of Interfaith culminated after Thompson left Kurron’s advisory board, but the road to bankruptcy – marked by gaping operational deficits – was being paved through his tenure. Also on his watch, in November 2010, Episcopal Health Services terminated the company’s two-decade-old contact to manage St. John’s Hospital in Far Rockaway, disturbed by Price’s efforts to close the obstetrics unit in a low-income neighborhood in a cost-cutting maneuver and also supported by state officials. Soon after, in February 2011, Kurron’s biggest contracts – $14.6 million in politically-wired deals in tiny Bermuda –were abruptly terminated by the government 18 months before they expired amid a flurry of public condemnations.
Price’s champion there, Premier Ewart Brown, awash in corruption allegations, had just stepped down, and the new leader of Brown’s PLP party decided to kill one of the most expansive deals arranged by her own party, an extraordinary event in Bermuda’s hyper-partisan politics.
Of course, none of this was Thompson’s business at Kurron. But the problems made his experience particularly relevant to Price, who explained that he was “shifting direction” to private equity because his other businesses were drying up. Kurron’s battles over Interfaith peaked as Thompson apparently was exiting the firm.
Indeed, the medical center’s bankruptcy papers read like an expose of Price and Kurron, as well as an autopsy of a gutted hospital. IMC filed on December 2, 2012 – three days after awarding a new $3.25 million contract to Kurron, some $250,000 of which was paid the day before the contract was signed. The contract, which had to be approved by the bankruptcy judge, called for Kurron to continue managing the hospital and become its “restructuring adviser” during the bankruptcy process, with Price as Chief Restructuring Officer and CEO. The rationale was that Kurron knew interfaith so well it was the only consultant that could salvage it, and the judge eventually approved the deal.
The U.S. Trustee that oversees bankruptcies, - joining 1199, the nurses union and the hospital’s creditors – filed objections to the Kurron deal. The independent trustee found that Kurron “could be an impediment to reorganization,” questioning its ability “to fulfill its fiduciary duty.” Price’s 35-years in the health care business, featuring restructuring experience, was one of the reasons Kurron won the court battle. He promised the judge in court and in writing that he would be a 40-hour-a-week CEO and restructuring chief.
But the briefs from the unions told another tale. The hospital workers union accused Price of a “shockingly cavalier attitude,” arguing that he had not been “present physically” though the first months of the bankruptcy period. The nurses cited the observations of their own members, who said Price hadn’t been there “a single day” and had no office or secretary at Interfaith, refusing to respond to requests for even a conversation. The hospital’s patient ombudsman said Price wouldn’t meet with him, and only talked to him once for five minutes.
Price responded in court to these allegations by listing a handful of phone inquiries he made about Interfaith, mostly to bankruptcy lawyers and consultants. Kurron also accused the objecting creditors of “prioritizing union interest.” In March, the judge singled out Price personally and dropped him from the contract, approving a new restructuring chief with no ties to Kurron to guide the bankruptcy.
Price’s remote management had been an issue for decades – at least since 1999, when Newsday reported that his claim he “spent very little time away from Interfaith” was “flatly contradicted by multiple sources.” Anthony Kovner, an NYU heath care professor, told Newsday then he’d never heard of a hospital story “stranger than this” – a hospital run by a missing person. Another key objection to Price was that he sat on the Interfaith board that awarded and administered Kurron’s contract for 10 years. The Newsday story was prompted by Price’s war with Interfaith workers; in it, Brian Lane, an 1199 leader, called Price “a hatchet man.”
Lane said: “That’s the style of Corbett Price. Everywhere he goes, he cuts to the bone.”
Polished, bejeweled and engaging, Price - a registered Republican who serves as a trustee of his alma mater, Ohio State University – works mostly out a Harlem townhouse on West 148thStreet he’s owned for years. He bought a $4.9 million condo in 2008 at 15 Central Park West, where Lloyd Blankfein of Goldman Sachs, Denzel Washington and Sting also had apartments and chauffeurs have a waiting room. Kurron sometimes used it for business purposes, but Price sold it in 2011, around the same time that Kurron closed its headquarters office at 885 Third Avenue, where Thompson and Price usually met at awkward two-member “board meetings.” The 800 number on Kurron’s neglected website is dead.
Perhaps Price’s most ambitious undertaking – and most ignominious fall during Thompson’s formal association with Kurron – was his detour to Bermuda.
Price won two of the small country’s biggest consulting contracts in 2007, shortly before “a friend” of his, as the island’s Royal Gazette newspaper described the new premier Ewart Brown, took office in 2006. Charges of cronyism had risen when Kurronbeat out the much larger and more prestigious Johns Hopkins Universityfor a plum assignment at the center of the nation’s healthcare system.
Officials in Bermuda attributed Price’s bonanza to the premier’s ex-New Yorker wife, Wanda Henton-Brown, a onetime New York investment banker whom Price had known for years; in the ’90s, they summered in nearby houses on Martha’s Vineyard. That’s also when Price steered a huge bond offering from Interfaith to the fledgling investment firm Henton-Brown had just founded herself. More recently, Price has given to Henton-Brown’s Bermuda foundation. Messages left for Henton-Brown in Bermuda were not returned.
Price was supposed to do three things in Bermuda: develop a national health plan, come up with a conceptual/financial model for a new hospital and propose a new insurance program for seniors called Futurecare. His health plan was never adopted, Futurecare has been turned upside down since he left and is running a $13 million annual deficit, and the new and financially troubled King Edward VII Memorial Hospital just shut down its continuing care unit for seniors this month as “not fit.”
An opposition party leader, Louise Jackson, called Price’s fees “absolutely obscene” on the floor of Parliament. Price’s 34-year old son Devin, a kick-boxing promoter, oversaw the Bermuda work for Kurron, sometimes conducting meetings about it at 15 Central Park West. Once Brown resigned in 2011, awash in scandal, his successor, though she was also a leader of Brown’s PLP party, cancelled Kurron’s contract – 18 months before it expired.
The worst of Kurron’s problems – in Bermuda, and at Interfaith and St. John’s – came home to roost during Thompson’s association with Kurron and Price. The issue for Thompson is not whether he aided or advised Price on labor relations, Bermuda or the management of the Brooklyn hospitals. The question is why he identified himself with a company with so much baggage.
In 2008, while serving as comptroller,Thompson got a highly favorable mortgage and credit line from the union-owned Amalgamated Bank, which did billions of dollars of business with his office – an episode highlighted in commercials run by Mayor Bloomberg’s 2009 reelection campaign, in which he edged out Thompson. The $1.4 million loan to acquire Thompson’s Harlem home was artificially split in half by the bank to avoid federal ceilings and secure a lower interest rate. Amalgamated’s management of city retirement funds administered by Thompson’s office grew from $174 million when became comptroller to $3.6 billion, taking its greatest leap at the same time Thompson got the favorable mortgage and earning the bank $51 million in fees.
Thompson and state officials also deposited $50 million in city cash in Amalgamated, making it the biggest recipient of a special public deposit program; the number two bank in that program, North Fork, also gave Thompson a personal line of credit and loans. He also used the comptroller’s office to push high state and city officials tofund his wife-to-be’s new African-American art museum on Fifth Avenue, which was slated to open in 2009 but remains uncompleted.
All this is history. The substantive issue, in the midst of a tight mayoral primary, is why Thompson decided to enter and maintain a compensated business relationship with a man with Price’s history. Besides repeating over and over yesterday that he had “nothing to do with Kurron,” that’s not a question Thompson has answered.
Ben Shanahan and Tamara Smillie, a research assistant at the Nation Institute, contributed reporting.
Democratic mayoral hopeful Bill
Thompson is apparently over Hank Sheinkopf's having helped Mayor
Bloomberg win that third term -- the ex-comptroller has hired the
veteran consultant as a senior strategist.
Sheinkopf's sign-on with Team Bloomberg in the '09 race -- during which he pulled in $10,000 a month in consulting fees -- raised eyebrows because of his long relationship with Thompson.
"There was a time when he certainly was not happy with me, but
there's a larger issue involved, and the larger issue is getting him to
Gracie Mansion," Sheinkopf said of Thompson.
"I'm emotionally very moved that he would want me back and working
with him, and I hope that I can help to make him the next mayor of the
city of New York."
The Sheinkopf announcement came in a rollout of new members of Team
Thompson -- including new Communications Director John Collins, a former
staffer for Anthony Weiner. Policy Director Amber Green is joining the
campaign from GMMB in Washington, a firm whose partners include former
Weiner media guru Jim Margolis.
Thompson is also bringing on more Obama veterans,
including Senior Advisor Karine Jean-Pierre, who's worked on both the
campaign side -- helping run battleground state ops -- and in the White
House. Another ex-Obama staffer, Will Leaverton, who ran GOTV ops, will
serve as Thompson's field director.
More additions to the team, which already includes Jonanthan Prince
and Bruce Gyory: Deputy Campaign Manager Frank Thomas, who managed Rep.
Kathy Hochul's re-election bid last year, and Political Director Kim
Ramos a strategist and lawyer with a network of contacts particularly among Latino electeds in the city and state Legislature.
Sheinkopf isn't the only well-known consultant who worked on Bloomberg's
campaign despite long-standing ties to Thompson personally or the
Democratic Party at large: Others included Howard Wolfson, an
inner-circle Clinton aide for many years, who also went on to become
No "betrayal" in his case, Sheinkopf said: He and Thompson had talked
about the '09 contest, but simply hadn't been able to cut a deal.
Before that, he said, he hadn't worked for the ex-comptroller since 2001.
Despite being grossly outspent, Thompson ended up losing the race by only about four points.
The results, far from a blowout, spurred grumbling -- and regrets -- about how more money, big-name endorsements or ground troops might very well have kept Bloomberg from scoring another four years.
Controller's attorney bashes both sides while in court for divorce spat
City Controller William Thompson and second ex-wife, Sylvia Kinard-Thompson, are battling over a piece of furniture.
Controller William Thompson's divorce has turned into a nasty battle of name-calling and petty squabbles - and that's just from his lawyer. Saul Edelstein,
who represented the city's top moneyman in his split from his second
wife, insulted Thompson's ex in an open courtroom Wednesday as "crazy as
"By the way," Edelstein said full voice to a lawyer sitting next to him in the crowded gallery of a Brooklyn divorce court, "my client's not too smart, either."
Thompson's 2005 split from Sylvia Kinard-Thompson
was finalized a year later - but the couple is bickering over a piece
of furniture that once belonged to the controller's grandmother,
His colleague agreed that Thompson - a
likely candidate for mayor next year - wouldn't want his marital
troubles ending up "in the Daily News."
The chatty lawyers
were unaware they were sitting in front of a News reporter in the
courtroom's benches while they waited for their hearings to start.
Most of the conversation could be heard by several people around them, and the reporter did not have to strain to listen.
Thompson, 54, was supposed to be at the hearing but skipped it to attend a housing forum.
So he missed his lawyer grousing that Kinard-Thompson "wants to be first lady" and her former divorce lawyer is "inexperienced" and "just as crazy as she is."
Kinard-Thompson, who is a lawyer, was sitting at the other end of the courtroom and did not hear the exchange.
She later threatened to take action against Edelstein for his words.
am shocked and disappointed by those comments. I have always regarded
this as a private matter. I married Bill because I loved him and because
he said he loved me," Kinard-Thompson said in a statement.
"As a Christian, I will continue to pray for Bill. As an attorney, I will see his lawyer in court."
spokesman for Thompson declined to comment, calling it a private
matter. Edelstein could not be reached to respond to Kinard-Thompson.
The self-described "dean" of Brooklyn divorce lawyers, Edelstein was more guarded about his opinions when he and Kinard-Thompson appeared before Judge Eric Prus.
Kinard-Thompson represented herself at the hearing.
Thompson claims his second wife took his grandmother's credenza from their former Brooklyn home.
It's not worth much, maybe "a dollar and a half," Edelstein said.
"It has great sentimental value," Edelstein told the judge. "She's taken that. She's not allowed to take that."
The couple were supposed to get together to divvy up their furniture, but that never happened, the lawyer said.
Kinard-Thompson insisted Thompson gave her the piece as a gift.
"All I want is what's fair," Kinard-Thompson said.
The couple married in 1999, and their divorce was settled in May 2006.
Kinard-Thompson complained that Thompson has locked her out of their former Bedford-Stuyvesant house and allowed his first wife, Angela, to move in.
exasperated judge said the couple would have to share the cost of a
$200-an-hour master to decide the credenza dustup unless they can work
it out with a hearing officer. email@example.com