Volume 75, Number 14 | August 24 - 30, 2005

Lopez pays to play, gets her matching funds (whew!)

By Lincoln Anderson

Margarita Lopez last week received public matching funds for her borough president campaign — but she first had to make a payment equaling almost half of what she was awarded.

Two weeks ago, Lopez’s campaign was jilted when the Campaign Finance Board, in its first round of allocations of matching funds, withheld hers, claiming Lopez still owed them a “significant amount” of unspent funds out of the $143,682 in taxpayers’ money she received for her 2001 City Council reelection campaign. Some of Lopez’s qualified expenses weren’t adequately documented, according to C.F.B., and so were classified as “unspent” and should be returned.

However, Tanya Domi, a C.F.B. spokesperson, said that last week an agreement was reached under which Lopez paid the board $185,877, in return for which she was awarded $382,239 in matching funds.

Domi called Lopez’s payment to the board “a protection to the taxpayers, representing the greatest liability and amount of any liabilities that could be found. This represents all the funds [Lopez received for her race] for 2001, plus potential penalties for serious outstanding issues.” Domi said the penalties are “potential” only at this point, because C.F.B. has not conducted a final audit of Lopez’s 2001 funds. Domi said Lopez has requested the audit be put over until October, after the Sept. 13 Democratic primary election, and that the board granted Lopez’s request.

As for where Lopez got the $185,877 to pay C.F.B. to release her 2005 matching funds, Domi said this money was in the form of “personal loans,” and that she could not describe it more.

“As of now, she’s in compliance, so she was able to be granted matching funds,” Domi said of Lopez’s status. “If things are resolved and if it was found that she satisfied board questions, theoretically, some of that money could be returned.”

Under the city’s campaign finance law, candidates can qualify for a 4-1 match in city money for the funds they raise.

Lopez said she was always confident she would get her matching funds.

“I knew that I was going to get it,” she said. “This is just the typical situation that is happening with the Campaign Finance Board with regard to audits.”

It wasn’t clear if the personal loans were from Lopez or others or some combination thereof. Asked for details about the loans, Lopez was tightlipped.

“I don’t know what you’re talking about — and that is a private matter,” she said. “I don’t understand why you are asking me questions about that. I do not have to speak to anybody about my personal finances.”

David McWater, chairperson of Community Board 3 and a supporter of Lopez’s campaign, said he didn’t loan Lopez any money. Speaking last Friday, the day after Lopez was awarded her matching funds, he said he’d heard some rumors to that effect, but didn’t even know definitively that Lopez had gotten the C.F.B. cash at that point.

Rumors had recently been swirling that Mayor Mike Bloomberg — with whom Lopez has a close relationship — or possibly former Mayor Ed Koch, at Bloomberg’s urging, would endorse Lopez for borough president. However, the recent revelations that a significant amount of Lopez’s campaign funds are from Scientology members and that she allocated funding for a Downtown detoxification center run by Scientology, seemed to have put the kibosh on those possible endorsements — if, in fact, they were ever going to happen.

Last week, Koch told The Villager he wouldn’t support Lopez because of the issues with her 2001 campaign funds, not because of her Scientology connection. A few days later, told that Lopez had temporarily allayed her public funds problems by making an insurance payment to C.F.B., Koch said his position had not changed.

“Doesn’t make any difference,” he said. “I’m not going to consider her in my decision-making.”

If she had been expecting Koch or Bloomberg’s endorsement, Lopez didn’t let on. Asked if the mayor and former mayor had really been thinking of endorsing her, Lopez responded, “I don’t know what you’re talking about.” Asked if she wanted their endorsements, she repeated, “I don’t know what you’re talking about.”

Stu Loeser, a Bloomberg campaign spokesperson, said that the mayor wasn’t planning to endorse in the B.P. race — and hadn’t given Lopez a loan. Asked if the mayor had been planning to endorse Lopez, Loeser had no comment.

In related news, Lopez blasted back at Michael Beys, who is among the City Council candidates running to succeed her, and at opponents who criticized her at a press conference last week for not having allocated funding to renovate the old Baruch Houses bathhouse on the Lower East Side into a community center. Lopez said the Parks Department had told her it would cost $25 million to $30 million to renovate the dilapidated bathhouse — known as “the White House” — and that Community Board 3 didn’t make fixing it up a priority.

“The community board is my guide. If the community board has not put that in there, what are they talking about?” Lopez asked of her critics. She added that “10 parks” could be renovated in the community board district for the same price as rehabbing the bathhouse.

In response to Lopez’s comments, Beys sent The Villager a copy of the Office of Management and Budget’s Register of Community Board Budget Requests for fiscal year 2004. Item number 19 of 32 items on Community Board 3’s capital budget priorities and requests for that year was “Develop Baruch Bathhouse and Surrounding Park.” O.M.B.’s recommendation to C.B. 3, as stated on the Register, is: “Parks Department funds are insufficient for this project. We recommend this project be brought to the attention of your local elected officials, i.e. borough president and/or city councilmember.”

Beys said, on Monday, “with the help of kids from Baruch Houses,” he also mailed a copy of the C.B. 3 F.Y. ’04 district needs statement to Lopez and Rosie Mendez, whom Lopez has endorsed to be District 2 councilmember.

Carli Smith, a Parks spokesperson, confirmed fixing up the bathhouse would be very costly, on par with the construction of the Chelsea Recreation Center and such large-scale projects.

“We’re always interested in improving our facilities,” she said. “But this is not a $6 million ribbon-cutting.”

Carlos Rosa, a C.B. 3 staff member, confirmed the bathhouse was in fact on the board’s needs statements for fiscal years 2000 through 2004.

“It’s the largest Housing Authority development in New York City,” said Roberto Caballero, a former Democratic district leader who is on the Baruch Houses tenants association and a Lopez foe. “Lopez is devoting so much time and energy to the Lower Eastside Girls Club. What about Baruch Houses? We have 1,800 children here. If she can see the Girls Club long term, why can’t she see the community center here?” Lopez has played an active role in helping the Girls Club secure property on Avenue D to build its first clubhouse.

Caballero noted Lopez’s successor, former Councilmember Antonio Pagan, didn’t see the Baruch bathhouse as a worthwhile project, either.

“Six years of Pagan, eight years of Lopez and they haven’t earmarked money for a feasibility study,” he said.

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