State Comptroller - General Election
(photo from facebook.com)
HARRY WILSON – REP, IND, CON
Harry Wilson's Candidate Questionnaire
Harry Wilson's Candidate Questionnaire
Age: 38 Occupation: Currently campaigning full-time
Education: Harvard University (BA); Harvard Business School (MBA)
Campaign website: http://www.wilsonfornewyork.com
Harry Wilson is making his first run for political office, seeking to replace incumbent Tom DiNapoli as state comptroller. Wilson recently entered public service, having served as the only Republican on President Obama’s Auto Task Force in 2009 that was charged with overhauling auto industry titans General Motors and Chrysler in the wake of the economic crisis. While his first foray in the public arena, Wilson’s sees his service on the Auto Task Force as being an extension of his private sector work for a number of private equity firms including Goldman Sachs, The Blackstone Group and Silver Point Capital. For these firms, Wilson was responsible for turning around distressed companies, something that became an interest to him as a youth growing up in Johnstown, New York when he sought to better understand why his mother was laid off from her job.
Wilson sees many parallels between his previous work on the federal Auto Task Force, his private sector work turning around failing companies, and New York’s distressed fiscal state. Noting the similar size in budgets, he believes he can apply the skills and lessons learned from turning around General Motors to right another entity in fiscal disarray, New York State. He contrasts sharply his experience in finance and turning around failing businesses with the incumbent, Tom DiNapoli, who came to office through appointment of the legislature following the resignation of the disgraced former comptroller, Alan Hevesi.
Wilson promises to use the Office of the State Comptroller more aggressively than the incumbent to investigate waste and fraud. He notes that DiNapoli has only saved $2.9 billion out of $400 billion spent by the state while DiNapoli was in office. Wilson promises to do a line-by-line audit of all government agencies and entities as part of a systemic review of state government. This review, Wilson states, is necessary to reduce spending so ultimately taxes can also be lowered which will generate economic growth and prevent the emigration of the state’s population to more affordable parts of the country. Wilson believes he could dramatically shrink the Office of the State Comptroller from its current staff of 2,500, noting that with just about 50 staff and 50 consultants, the federal government was able to restructure General Motors. Part of this downsizing would involve diminishing the number of money managers for the state’s pension funds by shifting portions of the domestic equity portfolio to index funds, which Wilson believes would also save nearly $100 million in fees in addition to reducing the headcount.
Wilson believes the state’s pension funds are woefully underfunded by $30-$80 billion and calls for the creation of sixth pension tier. He takes issue with a Pew Charitable Trusts Center on the States’ report and Governing Magazine assessment that showed New York State had one of the better funded pension funds in the country, noting the study simply used the current comptroller’s overly positive assumptions for the rate of return on investments. This unrealistic prognostication, Wilson believes, is rooted in the state’s use of discount rate standards established by the lax Governmental Accounting Standards Board (GASB), instead of those set by its private sector equivalent, Financial Accounting Standards Board (FASB), which is stricter, and Wilson believes, more accurate. Wilson also notes that applying the stricter accounting standards used in the private sector to all of state government reveals an enormous $300 billion total in debt.
With regard to reform, Wilson would continue the incumbent’s ban on placement agents and expand the ban to trial lawyers doing business with the state pension fund. He, like the incumbent, does not believe the sole trustee model should be changed but notes that he would create a committee of world class investors to act as a screen for choosing managers of the pension fund. Wilson would also expand the scope of the office and its impact on the state’s fiscal affairs. For example, he would present the state budget after the conclusion of its fiscal year in a GAAP format so New Yorkers would know exactly how income was received and what was spent on an accrual basis. Additionally, he would create a state balance sheet showing all of the state’s assets and liabilities, including those of the public authorities and all state agencies. Wilson supports the filling of a vacancy in the Office of State Comptroller through a special election rather than via appointment.
Citizens Union feels that with his financial experience Harry Wilson is well-suited for the position of state comptroller. His background in turning around failing companies and his work for Obama’s Auto Task Force where, as a Republican, he pushed the government’s takeover of the company through a majority ownership of its stock, demonstrates his ability to pragmatically solve problems rather than allowing ideology to trump objectivity. Citizens Union believes Wilson shows a deep understanding of the problems facing government, and can recite particulars on issues and programs that compensate for his newness to public service in New York State. Albany is in great need of reformers who can bring a new perspective and fresh ideas to the issues facing the state. Citizens Union is convinced that Wilson can bring a new and innovative approach to the position of comptroller and has the knowledge and demeanor to be a very effective and needed force for change.
(photo from facebook.com)
TOM DINAPOLI – DEM, WFP
Age: 56 Occupation: NYS Comptroller
Education: Hofstra University (BA); New School (MA, HR Management)
Campaign website: http://www.dinapoli2010.com
Tom DiNapoli is running for election for state comptroller for the first time following his appointment by the legislature in February 2007 after his predecessor, Alan Hevesi, pled guilty to a felony for using state resources to chauffeur his ailing wife. DiNapoli is a former state assemblymember who represented northwestern Nassau County for over 20 years, who served as chair of the Governmental Operations and Local Governments committees and as a member of the powerful Ways and Means committee. He is seeking election to continue the work he began in providing a roadmap for the state to structurally align its revenues and expenditures to put the state on better fiscal footing.
DiNapoli points to his accomplishments during a time of great tumult for the Office of the State Comptroller and the state as reasons for why he should be elected. He notes that he entered the office at a time when its ethical integrity was deeply compromised, and believes he has made great strides in restoring the dignity of the office through nation-leading reforms. He voluntarily banned placement agents and other intermediaries who had created a pay-to-play culture that led to former Comptroller’s Hevesi’s recent guilty plea to accepting $1 million in perks in exchange for steering pension investment business to Markstone Capital Partners. He offset any potential loss in diversity for pension fund managers stemming from the placement agent ban by establishing an emerging managers program and credits his work for diversifying the office much more so than when he first took office. DiNapoli also prohibited campaign contributions from those doing business with the Fund, and for the first year and a half of his service in the office, did not fundraise at all. DiNapoli supports a public system of campaign financing for the office, as a first step for establishing a wider system for state legislative and other statewide offices, and has testified at hearings to that effect. DiNapoli also made great efforts to increase government transparency, expanding Open Book NY so that New Yorkers could see how local governments were spending taxpayer dollars and the federal fiscal stimulus was spent. Should he be reelected, DiNapoli seeks to enhance transparency further by comparing appropriations to spending, and posting public authority contracts.
Beyond restoring public confidence in the Comptroller’s office, DiNapoli also notes that he was ahead of the curve in pointing out the growing state fiscal imbalance, and believes that he has used his office to release reports critical of the budget, illustrating the short-term view of legislators who see the importance of a set of programs but overlook the need to ensure the long-term fiscal health of the state. DiNapoli has also called for budget reforms that would help to realign state revenue and expenditures including an independent budget office, Generally Accepted Accounting Principles (GAAP) accounting, multi-year budgeting, restrictions on the use of one-shots, enhanced transparency in budget documents, and required negotiation of the budget through conference committees. While making these efforts, DiNapoli recognizes that ultimately legislators make the budgetary decisions. He feels, however, that he has used his office to show where savings can be found through its audit function. Among the accomplishments he touts are audits that have resulted in the state issuing a Request for Proposal (RFP) for a new claims processing function for the state’s Medicaid program and audits that have shown the MTA how to maximize real estate revenues and uncovere abuse in overtime practices.
DiNapoli pushes his ability to effectively manage the pension fund during difficult fiscal times, something his challenger Harry Wilson has disputed, but that DiNapoli states is “adequately funded” and is one of the best-funded in the country as echoed by the Pew Center and Governing Magazine. DiNapoli acknowledges that while the pension fund lost tens of billions off its peak, it also had one of its best years in 2009 under his watch when it gained 26 percent. DiNapoli also lowered growth projections to 7.5% and required local governments to increase their contributions to ensure obligations to the Fund are met.
Citizens Union believes DiNapoli is a capable public official who deserves credit for taking a troubled office under investigation and bringing about commendable reforms in relation to placement agents, fundraising and transparency, though the total ban on those placement agents who are licensed professionals employed directly by the financial firms went too far. DiNapoli has also attempted to point out the many shortcomings in the state’s budget process. Citizens Union feels, however, that while DiNapoli has done a good job in managing and reforming the comptroller’s office, the office is in need of much bigger transformational change than someone who has been a part of state government for the past twenty years can provide