Buildings Dept. Woes Have Persisted Despite Bloomberg's Overhaul

NY Times - October 31, 2009


Mayors have been grappling with inefficiency and corruption within the city's Buildings Department for decades. John V. Lindsay's buildings commissioner so tired of allegations of graft that he suggested the agency give its inspectors uniforms without pockets.

But Michael R. Bloomberg took office with a reputation for managerial ingenuity and earned accolades for crime reductions and improvements in student test scores. He brought a flair for technological, data-driven solutions honed in the business world and an outsider's energy to refashion tired practices.

"Reducing corruption is one of this administration's primary objectives," he declared in a news release about the Buildings Department early in his first term.

Over the past seven years, however, the agency has largely been a blemish on the mayor's record, a bureaucracy that found it difficult to effectively oversee a construction industry that operated at full throttle during the building boom while construction spending doubled.

"When you pay people who have the responsibility as inspectors so little, they're prone to having their hand out," said Daniel J. Castleman, a former chief assistant in the Manhattan district attorney's office who is now a managing director at FTI Consulting, an investigations firm. "That's not endemic to one mayor or a dozen mayors, that's just the way it is. There's so much money to be made in construction and development that people are going to offer you things and people who are paid less are going to think, ‘Who's this going to hurt?' "

The point was driven home just six months into Mr. Bloomberg's first term, when 19 of the city's 24 plumbing inspectors were arrested on federal bribery charges.

Since then the Buildings Department has been cited for regulatory oversights in connection with demolition work at the former Deutsche Bank building, where two firefighters lost their lives in a blaze that prosecutors tied to inspection lapses by the agency. Two tower cranes have fallen, killing nine people, and in the aftermath prosecutors ended up charging two of the agency's crane inspectors.

More recently, the agency has had to change the way it oversees the concrete industry after two testing companies were indicted on charges involving their work.

Mr. Bloomberg's highly regarded first buildings commissioner, Patricia J. Lancaster, resigned under fire. His second, Robert D. LiMandri, is now trying to deal with the arrest last month of additional inspectors, three of whom were accused of being associates of organized crime.

Mr. LiMandri said in a statement on Friday that the allegations against the inspectors "are a disgrace," adding that they "do not reflect the honest work of so many employees at this department."

"We are currently reviewing our entire hiring process to determine the best ways to further strengthen our procedures," he said.

To be sure, Mr. Bloomberg made efforts to change the culture of the department, suggesting that transparency and efficiency would reduce opportunities for graft at an agency where inspectors who start at a salary of $48,017 a year could shut down a multimillion-dollar development project.

The mayor has nearly doubled the number of inspectors since 2002, to 379, and over the years his administration has announced changes including increased screening of new employees, spot audits, an anti-corruption unit and closer cooperation with the Department of Investigation. Criminal record and background checks, an integrity questionnaire and other measures were introduced to help weed out potentially vulnerable or suspect job candidates.

Indeed, in May 2007, almost 18 months into Mr. Bloomberg's second term, the city's Conflicts of Interest Board saw fit to bestow an integrity award upon the agency, once branded as the city's most corrupt.

Just three months after the award ceremony, though, a series of failures and scandals began to unfold.

The fatal fire in August 2007 at the former Deutsche Bank building, resulted in a criminal investigation that quickly disclosed a raft of failures by the building agency's inspectors and their supervisors. Along with errors and oversights by the Fire Department, the agency's conduct nearly led to criminal negligence charges being lodged against the city itself.

Then, in March 2008, a tower crane crashed on East 51st Street, killing seven people. A criminal investigation quickly uncovered corruption among the agency's crane inspection force.

One inspector was charged with lying about checking on the crane days before the accident, though he would not have been able to foresee the accident even if he had inspected it, officials at the time said; and the acting chief crane inspector was charged with taking bribes to ensure that other cranes passed inspection and that operators passed the licensing test.

Two months later, another tower crane collapsed, at East 91st Street, leading to another criminal investigation of the agency's Cranes and Derricks Division.

This September, the agency had to totally revamp its procedures for overseeing the testing of concrete. That move came more than a year after another criminal investigation — this one focused outside the department — led to charges that the region's largest testing company falsified the results of some tests and failed to do others. The disclosures prompted retesting at scores of buildings around the city and revealed that the agency had failed to uncover the problems at the testing companies.

This month, an indictment charged that three of six inspectors accused of bribery and a range of other crimes — all hired after the new screening procedures had been put in place — were associates of the Luchese crime family.

The three men, according to the charges, not only routinely took bribes, but trafficked in drugs and were involved in gambling and loan-sharking. A supervising inspector was among the 29 people charged in the indictment, as were two men identified as senior members of the crime family.

Robert M. Morgenthau, the Manhattan district attorney, whose office brought the case and investigated the Deutsche Bank fire and the crane collapses, underscored the vulnerability of the department when he said the crime family had "actually sought to place associates in a government agency and influence the routine functions of that agency."

The three inspectors identified as crime family associates all had misdemeanor arrests on their records before they were hired.