Private investigator’s “Buffalo Billion” probe contract — worth more than $1 million — finally approved by comptroller [Updated]

Private investigator’s “Buffalo Billion” probe contract — worth more than $1 million — finally approved by comptroller [Updated]

The contract between Governor Andrew Cuomo’s office and Guidepost Solutions LLC, the firm of private investigator Bart Schwartz that was hired to probe the Buffalo Billion and nanotech-related state projects, was approved by the comptroller’s office on June 7, the state’s contract and vendor database shows.

The contract, as previously reported, stretched from April 29 to December 31 of last year. The copy published by the Times Union in July stated that its value could not exceed $450,000. However, the comptroller’s database reports that the contract’s value is slightly more than $1 million.

“We have not been paid, but I’m told it is approved for payment,” Schwartz told The Alt in an email. A comptroller’s office spokesperson told The Alt that Guidepost needed to send the agency invoices for payment.

In September, the day after federal corruption charges were filed against now-former SUNY Polytechnic Institute president Alain Kaloyeros and others, the Cuomo administration released a memo from Guidepost titled “Summary Findings and Review Protocols.” At least one watchdog group criticized the proposed reforms in that memo as insufficient.

“Overall, Schwartz’s recommendations are focused on preventing fraudulent or poorly documented billing and not on preventing bid rigging of the kind alleged to have taken place,” nonprofit watchdog Reinvent Albany opined last year. (That group, along with a coalition of others, continues to push during the last week of session for a slate of proposed procurement reforms that includes re-empowering the comptroller “to review and approve all state contracts over $250k.”)

It was unclear then and remains unclear today if the public will ever see any other findings from Guidepost, if they exist, related to the upstate development deals.

“You should contact the Governor’s office,” Schwartz told The Alt in an email on Wednesday.

Back in May 2016, the governor’s counsel told reporters: “There is no restriction on Bart Schwartz making any report public. It’s completely within his discretion…It’s not our decision, it’s his.”

Gov. Cuomo’s then-chief of staff added that “first and foremost” Guidepost’s report would be sent to the Southern District of New York. A Cuomo spokesperson also reportedly told the Times Union at the time that Schwartz “will make his findings public unless a law enforcement agency determines that it would interfere with their work.”

The Alt reached out to more than a half dozen attorneys representing defendants in the pending federal case, asking if they had encountered any Guidepost documents during discovery. One attorney responded to say only that discovery is subject to a protective order.

A similar inquiry with the Southern District of New York did not receive an immediate response. A spokesman had previously declined to comment on a similar inquiry from The Alt in April.

“I hope you understand, I cannot release our work product unless the client instructs me to do it,” Schwartz told The Alt in an email. We asked if this meant that, contrary to what the governor’s counsel had told reporters over a year ago, this meant that releasing findings was not totally up to him.

“Not necessarily. But I can’t rely on a newspaper article for authority,” Schwartz replied. We pointed out that there is video of the exchange, but he did not immediately respond after that.

It seemed at least plausible that the contract finally approved by the comptroller’s office could have differed materially from the contract made public in July. That contract read, in part, “At the conclusion of the services, [Guidepost] may, in its discretion, issue a report of its findings.”

This morning, we submitted a FOIL request to the state comptroller’s office, seeking the approved contract. We asked a spokesperson from the agency if she could describe any changes to the contract and what accounted for the apparent delay; she said she would be in touch.

In December, a Cuomo spokesman told the Times Union that the governor’s office “look[s] forward to receiving [Guidepost’s] final findings.”

We first contacted Schwartz in April. “We submitted our findings,” he wrote at the time in one email. “Not sure when it would be released and that is what I am inquiring about.” But Schwartz never supplied a date and eventually stopped returning our emails.

The Times Union humorously documented its attempts to learn about the prospective extension of Schwartz’s contract, which appears not to have happened. The newspaper also reported on a dispute between the governor’s office and comptroller’s office concerning the procurement of Schwartz’s contract and its deliverables.

In April, The Alt submitted Freedom of Information Law requests to more than a half dozen agencies seeking Guidepost’s findings. So far, we haven’t had much luck.

A spokesman with the governor’s office did not immediately respond to a request for comment concerning this article, which will be updated if we hear from him. We will also update this post if we hear anything further from Bart Schwartz or the comptroller’s office.

Update 7:45 P.M. A spokesman with Empire State Development, the state agency that now essentially oversees the upstate projects Guidepost reviewed, emailed us the following statement:

“The final contract represents a wider than anticipated scope of these tasks, which included sifting through hundreds of thousands of pages of documents, meetings, and other tasks associated with the review of $400 million in contractual payments and the development of new, stronger protocols for state agencies. ‎The contract has concluded, the Comptroller’s Office went through their review process and it was approved.”

Update 8:15 P.M. The Buffalo News, citing a Schwartz report obtained through a FOIL request with the comptroller’s office, has reported that the private investigator “identified ‘systemic problems’ in the state’s handling of $49 million in bills.”

Update, Friday 11 A.M. Through a FOIL request with the comptroller’s office, The Alt has obtained the Schwartz letters to Cuomo referenced in The Buffalo News story, as well as the contract amendments made in April that changed the contract’s total value from a maximum of $450,000 to more than $1 million. 

Below is Schwartz’s letter to Gov. Cuomo, dated April 17, and another dated Sept. 22. The contract amendments can also be viewed here.


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