De Blasio reveals deal to defer paying legal fees from probe

The law firm representing Mayor de Blasio in investigations of his fund-raising tactics has been sending bills for nearly a year, but as of Friday has yet to receive a dime.

The mayor said he has an agreement with the firm, Kramer Levin Naftalis, to defer payment until he sets up a fund-raising committee to foot the bill.

“It’s the only way,” he said at an unrelated press conference in the Bronx. “I inform you again that I am not a billionaire like my predecessor. There’s no way I can possibly cover these fees personally.”

That means the mayor likely currently owes tens and perhaps hundreds of thousands of dollars to one of the biggest lobbyist law firms in the city. He declined to say how large the tab is.

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The firm has said it keeps its lobbying and legal representation separate. Barry Berke, the mayor’s lawyer at Kramer Levin, did not respond to calls.

Records show the firm lobbying the mayor’s office in 2015 and 2016 on behalf of two dozen real estate developers seeking zoning changes and project approvals.

That includes DDG Development, which hired Kramer in May 2015. Kramer handled DDG’s petition for a zoning change on a luxury condo project in Tribeca before the city Bureau of Standards & Appeals.

On June 23, 2015, the BSA approved DDG’s application, despite vociferous neighborhood opposition about the project’s size.

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Eight days later DDG wrote a $ 10,000 check to the mayor’s now defunct non-profit, Campaign for One New York. CONY is now at the heart of the federal investigation.

Asked whether the law firm allowing him to defer payment on legal bills while lobbying his team presented a conflict of interest, the mayor defended the firm.

“They’re one of the most renowned legal firms for this type of work. They’re an obvious place to turn for legal support,” he said. “And I’m going to continue to make sure that their bills are paid off fully. But any other matters, we have an absolute ability to separate the different considerations. That’s what I’ve said about everything in this reality. We’re making decisions on any governmental matters according to the merits.”

Cover of the New York Daily News for April 23, 2016: State Board of Elections investigator probes the 2014 fund-raising efforts by Mayor de Blasio.

Cover of the New York Daily News for April 23, 2016: State Board of Elections investigator probes the 2014 fund-raising efforts by Mayor de Blasio.

(New York Daily News)

“This is a debt,” said Susan Lerner, director of the non-partisan watchdog group Common Cause New York. “The law firm expects to be paid and until the law firm is paid they have a debt.”

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De Blasio confirmed the arrangement in response to Daily News questions at the Friday press conference, though he wouldn’t say how many hours the firm had billed for or reveal the range of hourly rates.

“I’m not even sure that’s a purely appropriate public matter,” he said. “The bottom line is, they have sent bills, they will be paid. It’s going to take a while. That is for sure.”

He promised to eventually “disclose the money,” but didn’t say whether he would reveal names of donors or whether they had business with City Hall.

Manhattan U.S. Attorney Preet Bharara is investigating whether de Blasio did favors for donors to Campaign for One New York. The News found at least $ 3 million of the $ 4.3 million he raised came from entities doing business with City Hall.

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On Friday de Blasio confirmed that he would soon meet with Bharara, though he wouldn’t say when. He also revealed that as part of his agreement to speak with prosecutors, he did not seek or obtain a promise of immunity from prosecution.

Who ultimately will foot the bill to pay off de Blasio’s debt remains to be seen. Common Cause wants laws regulating such committees, including requiring disclosure of donors and amounts.

“This is a hole in our law. Other jurisdictions regulate this,” Lerner said.

In California and Massachusetts, for example, “Donors and expenses are disclosed to the public, there are specific definitions about what is a legal expense,” Lerner said.

“Our recommendation is that the City Council should address this because the mayor clearly needs guidance,” she said. “For the mayor there’s no guidance.”

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