Christie Watch: Inside the Port Authority
It’s beginning to look like the investigation by the New Jersey state legislature into Bridgegate may end up going far, far beyond the mere issue of closing lanes in Fort Lee. They’re expanding to pry open a window on the vast patronage machine and cash cow that Governor Chris Christie has used since taking office in 2010: the New York and New Jersey Port Authority.
They’ll also look into the circumstances of Christie’s highly controversial decision in 2010 to cancel what was then the biggest public works project in the United States, a light rail tunnel under the Hudson River, and to use some of the funds from that project to pay for pet projects in the state.
The PA runs much more than a few bridges and tunnels. It controls an empire of real estate: the New York area airports, the gigantic New York and Newark, Elizabeth and Bayonne container port operation, the underground PATH transit system, and much more. Back in the day, and once again, it also owns the World Trade Center. The PA had operating revenues of $4 billion in 2012 and controls assets worth $37 billion.
Since 2010, Christie has installed dozens of cronies and favored operatives, including very high-level Christie insiders: David Samson, a real estate attorney, as chairman; Bill Baroni, now fired, a long-time Christie ally who was the PA’s deputy executive director; Philip Kwon, another key Christie ally is the agency’s deputy general counsel; and, of course, David Wildstein, Christie’s non-friend from Livingston High School, who was “director of interstate capital projects,” whatever that is.
Thanks to Bridgegate, most of those names are now well known not only in New Jersey but nationwide. What’s less well known is how Christie has used the PA to build his political machine, using its power to curry favor with a wide range of Democratic mayors, county officials and party bosses. In towns such as Hoboken, Harrison and many others, the PA is involved in or controls important development initiatives and transportation projects that are often entangled with cronies of the New Jersey governor and his friends.
The New Jersey legislature, whose first round of subpoenas was focused on documents and the people most immediately involved in the George Washington Bridge scandal, is now getting into explosive political territory: the PA itself, and how Christie has showered his friends and allies with political patronage jobs at the Port Authority and funneled its billions of dollars in revenues in ways designed to buy and control political loyalties. As detailed in the subpoena, the legislators want to know who was offered a job at the Port Authority by the governor, what were the exact job descriptions, how were they posted and advertised.
One critically important part of the inquiry will be examine the connection between a massive increase in tolls on the Lincoln Tunnel, the Holland Tunnel, the George Washington Bridge and other crossings in 2011 and the cancellation of the already-under-construction, mostly federally funded new tunnel project.
The committee’s subpoena demands extensive data on how the toll hike was decided and how the resulting money was used. They also want to know how Christie determined that the $8.7 billion tunnel project, which had been in the planning stages for decades, would suffer from massive cost overruns and so had to be suddenly cancelled. And the legislators are investigating how and why the Port Authority expanded into the South Jersey turf of an important Democratic political machine boss, to provide help to the beleaguered Atlantic City airport.
The Port Authority was set up in 1921 to oversee port and transportation projects in the New York New Jersey area and initially the governors of each state and legislatures had to approve projects. And the power of each state was checked further because the twelve commissioners were appointed equally by each governor. But, according to interviews with PA insiders, this balance started unraveling in 1995 when New York Republican Governor Pataki outraged New Jersey’s Republican Governor Christie Todd Whitman with a political appointee as executive director. The deal they struck was New Jersey’s ability to appoint its own person as deputy executive director—and, years later, that’s what would give Christie an opening to transform the way the PA functioned, within months of taking office in 2010.
In February 2010 Christie installed Bill Baroni in as the PA’s deputy executive director. Baroni, who began his ascent in New Jersey politics as a member of the state General Assembly and Senate, rose under the tutelage of Bill Stepien. Stepien, in turn, was Christie’s closest political adviser and campaign manager, and the person he’d decided to bring with him to the Republican Governor’s Association. Since then, of course, thanks to Bridgegate, both Baroni and Stepien have been forced out.
Once Baroni took the helm at the Port Authority, more than fifty other people with salaries above $100,000 were appointed to posts. A list of many of these appointees was released by the agency as a result of a lawsuit filed by an employee who was replaced by one of them.
The Bergen Record investigated who they were:
One was a gourmet food broker who landed work as an $85,000-a-year financial analyst at the Port Authority. Another got a $90,000 job to check maintenance contracts. An author and actor was hired as the employment publications editor—a three-day-a-week gig that pays $50,000 and provides full benefits.
In an interview with The Nation, Jameson W. Doig, a professor at Dartmouth and author of Empire on the Hudson, a definitive history of the Port Authority, said that Christie’s appointments “show patronage at work.” He added: “Christie was willing to use his power as governor to insist that the Port Authority hire his friends and party workers, even if they were not qualified for the work they were expected to do.”
The New Jersey legislative investigation may also finally bring to light the political dealings behind the enormous toll hikes the Port Authority enacted in September 2011, when fares on bridges and tunnels rose from $8 to $13. (They’re scheduled to go to $15 by 2015.) Usually such increases would only follow extensive public debate and discussions; instead, they were rushed through after only a single day of hearings that summer.
On behalf of commuters the American Automobile Association filed a lawsuit to stop the rate increase. For the past two years, the agency has used numerous legal maneuvers to prevent the AAA from getting documents related to the Port Authority’s decision to raise these tolls.
In a nice bit of irony and possible conflict of interest, the lawyer fighting AAA’s efforts is Randy Mastro of Gibson, Dunn & Crutcher, who also happens to be the attorney hired by Christie’s office last month to handle its internal review of what happened in Bridgegate and to cooperate with—or, some might say, stall—the US Attorney’s investigations.
Linked to all this—and the committee is seeking documents on this, too—is Christie’s decision in 2010 to cancel the tunnel project. By then, the various agencies involved had already spent over $400 million on engineering property acquisition, construction and other expenses. New Jersey’s Democratic Governor Jon Corzine had broken ground on the project just before his defeat by Christie in 2009.
But a few months after Christie appointed Baroni to the PA, he and David Wildstein, who is at the heart of Bridgegate, looked for other ways to use the $2 billion in PA funds slated for the tunnel. Here’s what they came up with: to help Christie keep his promise not to raise gasoline taxes, they decided to use it to resupply the exhausted Transportation Trust Fund, which is usually replenished through the gas tax at the pump. In addition, they sloshed some of it to build a rail station in a town whose Democratic mayor later supported Christie for re-election. And it went for a new bridge project that won him the support of the powerful International Laborers Union at his first re-election campaign rally a year later.
Bob and Barbara Dreyfuss are independent, investigative reporters and authors based in Cape May, New Jersey, and New York City, and the bloggers behind The Christie Watch.