California Man Charged In Manhattan Federal Court With Defrauding Thousands Of Donors To Scam Political Action Committees

  Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that JOHN PIERRE DUPONT, a/k/a “John Gary Rinaldo,” was arrested this morning and charged with wire fraud and aggravated identity theft for his role in a years-long, nationwide scheme to defraud thousands of donors who believed they were donating to political action committees and political campaigns.  The defendant is expected to be presented this afternoon in the District Court of Arizona.

U.S. Attorney Geoffrey S. Berman said:  “As alleged, John Pierre Dupont operated multiple fake political action committees and falsely claimed to be raising money to support more than a dozen campaigns.  Thousands of donors believed their hard-earned money was being used to support the causes described in solicitations, but in reality, the scam PACs had no operations beyond the fundraising itself, and no funds were used to support candidates.  My Office will continue to ensure that fraudulent fundraising does not pay – indeed, will result in criminal prosecution – by rooting out scam PACs wherever we find them.”

According to the Complaint[1] unsealed today in Manhattan federal court:

From at least in or about 2015 up to and including the present, JOHN PIERRE DUPONT defrauded thousands of donors who believed they were donating to three political action committees established by DUPONT (the “Scam PACs”),[2] or to campaigns the Scam PACs falsely claimed to support.  DUPONT’s scheme resulted in more than $250,000 being donated through websites he controlled and operated, all of which was retained by DUPONT, both to enrich himself personally and to perpetuate the alleged crime.

The websites purported to be raising money in support of Democratic congressional and senate campaigns generally, as well as approximately 10 particular Senate candidates, a candidate for governor, and a candidate for president.  None of the money raised went either to those campaigns or to support those candidates whatsoever.  Another website operated by DUPONT purported to be raising money “to unite immigrant families” and provide services in connection with certain immigration policies.  In particular, the Foundation for Sanity in Politics PAC website claimed that donations would “go to help pay our volunteer attorneys’, doctors’, nurses’ and social workers’ costs and pay for transportation to unite immigrant families.”  In fact, that PAC had no volunteers, and dedicated no funds to paying for doctors, social workers, or any other professionals, advocacy, or political operations.

The scheme targeted victims across the country, raising funds on the basis of fraudulent representations that the donations would support the relevant causes, candidates, and campaigns.  Instead, virtually all of the money raised was paid to DUPONT or used to perpetuate the fraud through additional fundraising and overhead expenditures.  None of the money donated to the Scam PACs was spent on political contributions during the relevant time period, and DUPONT failed to report the donations, as required, in filings with the Federal Election Commission.

Donations collected by DUPONT during the relevant period totaled more than $250,000, none of which went to campaigns or support for any candidate or cause.

JOHN PIERRE DUPONT, 80, is charged with one count of wire fraud, which carries a maximum sentence of 20 years in prison, and aggravated identity theft, which carries a mandatory two years in prison consecutive to any other sentence imposed.

The statutory maximum and mandatory penalties are prescribed by Congress and are provided here for informational purposes only, as any sentencings of the defendants would be determined by the judge.

Mr. Berman praised the outstanding investigative work of the Special Agents of the United States Attorney’s Office for the Southern District of New York.

If you think you are a victim of the scheme alleged in this press release, please contact Wendy Olsen, Victim & Witness Services for the U.S. Attorney’s Office for the Southern District of New York, at 866-874-8900.

The charges contained in the Complaint are merely accusations.  The defendant is presumed innocent unless and until proven guilty.

 [1] As the introductory phrase signifies, the entirety of the text of the Complaint constitutes only allegations, and every fact described herein should be treated as an allegation.

[2] Businessmen for a Businessman President PAC, Foundation for Sanity in Politics PAC, and Democrats for Congress PAC.

Chuck Person, Former Division I Men’s Basketball Coach, Pleads Guilty To Bribery In Manhattan Federal Court

Person, a Former Auburn University Men’s Basketball Coach, Pleaded Guilty to Accepting Cash Bribes in Return for Steering College Players on His Team to a Financial Adviser and Business Manager

  Geoffrey S. Berman, the United States Attorney for the Southern District of New York, announced today that CHUCK CONNORS PERSON, a former men’s basketball coach at Auburn University (“Auburn”), pled guilty in Manhattan federal court today to receiving approximately $91,500 in cash bribes from athlete advisers in exchange for using his influence over Auburn basketball players to retain the services of the advisers paying the bribes.  PERSON pled guilty before U.S. District Judge Loretta A. Preska.   

Manhattan U.S. Attorney Geoffrey S. Berman said:  “As he has now admitted, Chuck Person abused his position as a coach and mentor to student-athletes in exchange for personal gain.  In taking tens of thousands of dollars in cash bribes, Person not only placed personal financial gain above his obligations to his employer and the student-athletes he coached, but he broke the law.”

 According to the Complaint, the Indictment, statements made in court and publicly available documents:

Over the course of a year, PERSON, a former men’s basketball coach at Auburn University until shortly after his arrest, agreed to accept cash bribes in return for agreeing to exert his influence over student-athletes on the Division I men’s basketball team he coached to retain the services of the bribe-payers, including once the student-athletes entered the National Basketball Association (“NBA”).  

Beginning in 2016, and continuing into September 2017, when PERSON was arrested, PERSON received approximately $91,500 in cash bribes from a financial adviser and business manager, who, unbeknownst to PERSON, was providing information to law enforcement (“CW-1”).  In exchange for the cash bribes, PERSON agreed to exert his influence over certain student-athletes PERSON coached at Auburn University to retain the services of CW-1 once those players entered the NBA.  The bribe payments are alleged to have been initially arranged by a co-conspirator who had a preexisting relationship with PERSON and operated a clothing store that specialized in making bespoke suits for professional athletes. 

Over the course of the scheme, and in exchange for the cash bribes described above, PERSON did, in fact, arrange multiple meetings between CW-1 and Auburn players and/or their family members.  In those meetings, PERSON falsely touted CW-1’s qualifications as a financial adviser and business manager without disclosing that PERSON was, in fact, being bribed to recommend CW-1.  In one recorded meeting, PERSON stressed to an Auburn University player the importance of keeping their relationship with CW-1 a secret.  Person stated, “most important part is that you  . . . don’t say nothing to anybody . . . don’t share with your sisters, don’t share with any of the teammates, that’s very important cause this is a violation . . . of rules, but this is how the NBA players get it done, they get early relationships, and they form partnerships.”   PERSON later told that player that CW-1 would purchase him a separate cell phone over which they could communicate so as to conceal the nature of the scheme.  

PERSON, 54, of Auburn, Alabama, pled guilty to one count of conspiracy to commit bribery.  As a condition of his plea, PERSON agreed to forfeit $91,500.  The charge carries a maximum term of five years in prison.  The maximum potential sentence in this case is prescribed by Congress and is provided here for informational purposes only, as any sentencing of the defendant will be determined by the judge.  Sentencing is scheduled for July 9th, 2019, before Judge Preska.

Mr. Berman praised the work of the FBI and the Special Agents of the United States Attorney’s Office for the Southern District of New York.

Attorney General James Announces $62.5 Million In Settlement Credits For Spectrum Customers

  Attorney General Letitia James today announced that Spectrum (formerly Time Warner Cable) has started to issue credits to New York consumers as required by Charter Communications, Inc.’s December 17, 2018 settlement agreement. The settlement agreement resulted from an action brought by the Office of the Attorney General alleging that the company failed to deliver customers the reliable and fast internet service it had promised. Under the terms of the settlement, Charter is required to issue monetary relief to qualified subscribers and offer video streaming services, described below, at no charge. In all, qualified subscribers will receive $62.5 million in bill credits. Subscribers do not have to fill out any paperwork to obtain the credit, but must contact Spectrum to receive the streaming services. 

“Today, New Yorkers will start to receive the tens of millions of dollars and additional services owed to them due to the company’s failure to provide quality services to its customers,” said Attorney General Letitia James. “In issuing the largest-ever consumer payout by an internet service provider, my office is proud to set a higher standard for the way that internet providers accurately market services.” 

Spectrum will also offer the following streaming services to approximately 2.2 million current internet subscribers at no extra charge: 

• Current subscribers who subscribe to both internet and cable television from Spectrum will have a choice of either three (3) months of HBO OR six (6) months of Showtime. (Note: This benefit is available to subscribers who do not already subscribe to both of the offered services through Spectrum.) 

• Internet only subscribers will get one (1) month of Spectrum TV Choice streaming service—in which subscribers can (depending on their location) access broadcast television and a choice of 10 pay TV networks—as well as access to Showtime for one (1) month.

Consumers will have until May 30, 2019 to select the no extra charge premium services they want. Consumers should call Spectrum at 1-833-422-8795 for further information.

The Attorney General wants to ensure that all eligible subscribers are able to receive the no cost streaming services. We encourage subscribers to share their experience redeeming the offer by completing this survey.  

Current internet service subscribers who leased a DOCSIS 2.0 modem on a tier of 20 Mbps or higher or an 802.11n wireless router on a tier of 200 Mbps or higher, or who subscribed to a legacy Time Warner Cable plan of 100 Mbps or higher (as of February 1, 2017) will receive a credit of $75. Further, subscribers who leased a DOCSIS 2.0 modem on a tier of 20 Mbps or higher for 24 months or more will receive an additional credit. 

MAYOR DE BLASIO SIGNS LEGISLATION TO PROTECT WORKERS IN COMMERCIAL WASTE INDUSTRY

  Mayor de Blasio held hearings for and signed three pieces of legislation to protect workers in the commercial hauling industry: Intro. 1329-A gives BIC the authority to register unions operating in the trade waste industry; Intro. 1368-A requires trade waste companies to provide workers’ rights information to certain employees; and Intro. 1373-A requires BIC to refer labor and wage violations to appropriate state or federal authorities.

“This package of bills will allow the City to better protect workers and the public from irresponsible companies who put profit before people. Along with our commercial waste zones proposal, this legislation takes another step toward increasing the safety of the waste management industry and protecting workers from abuse,” said Mayor de Blasio.

Int. 1329-A sponsored by Council Member Reynoso gives BIC the authority to register unions who represent employees who are directly involved in the collection, removal, transportation or disposal of trade waste.  Names of all union officers and agents will be disclosed to the City, which will help ensure the trade waste industry remains free from organized crime and other corruption.

Int. 1368-A sponsored by Council Member Moya requires trade waste companies to provide workers’ rights information to employees in the trade waste industry.  Under this law, BIC will require all companies post and share information about workers’ rights, including the maximum number of hours employees are allowed to work in a 24-hour period, the minimum wage they must be paid, safety training requirements, safety equipment required, and information about how to file a complaint, including the list of agencies a worker can approach to file such complaint.  All this information will also be posted on BIC’s website.

Int. 1373-A sponsored by Council Member Reynoso requires BIC to refer labor and wage violations to appropriate state or federal authorities. The bill takes effect immediately after it becomes law.  This bill codifies BIC’s current practice of referring cases of wage theft or other labor violations to appropriate state or federal authorities.  In the past, BIC has worked with agencies such as the U.S. Department of Labor, the United States Attorney’s Offices, the FBI, and the Office of the Attorney General of the State of New York to investigate these claims and to take appropriate action.

“Worker abuses are unacceptable and this Administration is cracking down on bad actors in the trade waste industry. We have been working closely with the City Council on this legislation to give BIC more oversight of trade waste unions and protect workers,” said Business Integrity Commission Commissioner Daniel Brownell.

Collecting and transporting trade waste, particularly in New York City, is a dangerous and strenuous job.  The collection trucks are huge and must share the road with many other motor vehicles, cyclists and pedestrians.  As a result, this Administration has made safety in the industry and on the City’s streets a priority.  BIC continues to promote the universal trade waste safety manual that was created 2018 along with partner agencies and members of the trade waste industry.

BIC has prioritized traffic safety for the trade waste industry, conducting a number of joint enforcement operations with the NYPD targeting unlawful operation of trade waste trucks.  Since last summer, the NYPD and BIC have conducted approximately 15 joint operations, in which BIC issued more than 80 administrative violations to the companies, for issues such as undisclosed drivers, commingling recyclables with garbage and license plates not properly affixed to the trucks. 19 unsafe trade-waste trucks were put out of service on the spot and towed.

MAYOR’S OFFICE OF IMMIGRANT AFFAIRS RELEASES SECOND ANNUAL REPORT, REAFFIRMING CONTINUED COMMITMENT TO MAKE NYC THE FAIREST BIG CITY IN THE COUNTRY

MOIA led Citywide efforts to respond to attacks on immigrant communities by the federal government

Report publishes latest data on uninsured immigrant New Yorkers, as City implements NYC Care

  The Mayor’s Office of Immigrant Affairs released its second Annual Report, “State of Our Immigrant City.” As the City agency dedicated to supporting NYC’s 3.2 million immigrant New Yorkers, MOIA has continued to solidify NYC’s status as the fairest big city in the country for all residents, regardless of immigration status.

The new Annual Report describes MOIA’s 2018 activities in detail, including advocating for equitable access to City services, leading rapid response to harmful federal proposals and policies from the Trump administration, and providing timely, critical information and analysis to community members and stakeholders. The report includes new and updated data on demographic characteristics of immigrant New Yorkers. In addition, the Annual Report describes the City’s fight against the Trump Administration's family separation crisis and proposed changes to “public charge” rules.

“In New York City, we know that the contributions of immigrant communities help make this the greatest city in the world,” said Mayor Bill de Blasio. “Commissioner Mostofi and MOIA enshrine that perspective in City government and help us hold the line and drive forward with an agenda that helps us build a fairer city for all.”

“New York is a world class city in large part because over 3.1 million creative, inventive, hard-working New Yorkers from around the world have made this city their home,” said Deputy Mayor for Strategic Policy Initiatives Phillip Thompson. “MOIA’s tireless work every day on behalf of and in coalition with immigrant communities makes our city even stronger. I look forward to continuing our work towards greater economic and social justice for all, regardless of immigration status or national origin.”

“Building the fairest big city in the country means expanding and protecting opportunity to all of our residents, regardless of immigration status,” said Bitta Mostofi, Commissioner of the Mayor’s Office of Immigrant Affairs. “While the federal government has focused on separating and detaining families or jeopardizing access to public services, we’ll continue to stand with our immigrant neighbors. As a child of immigrants myself, I am proud to serve this city and proud of what we’ve accomplished, working together with the rest of the Administration, the City Council, our local and national partners, and most of all our staff in this past year. Onward!”

“With the federal government shifting away from protecting vulnerable consumers and workforces, and creating anti-immigrant policies that foster an increasingly hostile environment for immigrants, we are committed to advocating on their behalf,” said Department of Consumer Affairs Commissioner Lorelei Salas. “As an immigrant myself, I am proud of our ongoing work with MOIA to protect our communities—from financial health of taxi drivers to workers’ rights to enforcement against predatory businesses that prey on immigrants. We are not just filling the gap in protections but we want all immigrants to know that the City of New York is here to support them—regardless of immigration status.”

“The Mayor’s Fund is proud to partner with MOIA on our shared goal of advancing fairness and equity for every resident of the five boroughs, including the more than three million immigrants who make New York City their home,” said Toya Williford, Executive Director of the Mayor’s Fund to Advance New York City. “Together in 2018, we were able to quickly respond to the needs of immigrant children who had been separated from their families, help more immigrants understand their rights, and reach more eligible New Yorkers with resources about applying for citizenship. We look forward to continuing our partnership and congratulate MOIA on its recent achievements.”

"The Mayor’s Office for Economic Opportunity is a proud partner with MOIA in their mission to promote the well-being of immigrant communities and advance immigrant inclusion,” said Vicky Virgin, Research Associate at the Mayor’s Office for Economic Opportunity (NYC Opportunity), whose work focuses on New York City’s immigrant community. “Our recently released Economic Profile of Immigrants in New York City introduced the first in-depth analysis of the economic disparities that exist among the foreign born by legal status. We are pleased that this analysis informs MOIA’s important work to ensure the City advances policy that is effectively tailored to address the needs of all New Yorkers, irrespective of immigration status.”

“New York City has been, and always will be, a city that respects, supports and protects its diverse communities, including the 3.2 million immigrants that call New York City home,” said Carmelyn P. Malalis, Chair and Commissioner of the NYC Commission on Human Rights. “While the federal government continues its unrelenting xenophobic and racist attacks on our immigrant communities, New York City is ever more committed to being a place that welcomes immigrants from every country on the globe, a place where the diversity of cultures, languages, art, music, food and so much more contribute immeasurably to the rich fabric of New York City. No one has permission to discriminate against or harass someone because of where they come from, what language they speak, or how they dress, and the Commission on Human Rights works hard every day to protect ALL New Yorkers. We are proud to work alongside MOIA and Commissioner Mostofi in that effort.”

“New York City has always been a proud city of immigrants and ACS will continue to do everything in our power to ensure that immigrant children and families are both safe and healthy,” said David A. Hansell, Commissioner of NYC’s Administration for Children’s Services (ACS). “Immigration status should never be a barrier to obtaining assistance or services through the child welfare system, and in New York City we’ve made major strides to ensure that all families have access to our services, regardless of immigration status. I want to thank Commissioner Mostofi for her tireless leadership to strengthen and support all NYC families.”

“New York is a city of immigrants, and we’ve worked closely our partners at the Mayor’s Office of Immigrant Affairs to make sure every resident has access to our city’s wide range of cultural assets, regardless of their background or status,” said Cultural Affairs Commissioner Tom Finkelpearl. “From organizations that provide free memberships to IDNYC card holders, to artists who have worked to build bridges between immigrant communities and government, we’re thrilled to see our colleagues embrace art as a powerful tool to bring people together and explore our city’s most pressing challenges.”

“The strength of our City is firmly rooted in its diversity and we take pride on assisting the millions of immigrants who call New York City home,” said Department of Social Services Commissioner Steven Banks. “At a time when the message from the federal government is one of fear and divisiveness, we are committed more than ever to enhancing the lives of all New Yorkers regardless of their immigration status.”

New data analysis about NYC’s immigrant population is available in the Annual Report. Major new findings include:

• NYC is home to more immigrants than ever before, while NYC’s undocumented population is at a 10-year low, mirroring national trends.
• The level of uninsured immigrant New Yorkers has declined from 36.1% to 21.9% in over a five-year period.
• The poverty rate among immigrant New Yorkers is significantly higher than for New Yorkers born in the United States. The poverty rate for undocumented NYC residents is more than 50% higher than the citywide average and nearly 75% higher than the average for U.S.-born residents.
• The number of City agency approvals of U and T visa certification requests, for victims of crime or trafficking, reached a record high of 863.

The report also sets forth MOIA’s goals and recommendations for the coming year. Economic and civic inclusion, such as through strengthening worker protections and expanding poll-site interpretation services, are important to the vitality of the entire city. Advocacy on the federal and state levels is critical, as new opportunities arise for action to strengthen immigrant communities, including implementation of the New York State DREAM Act and protecting DACA and TPS recipients. While that advocacy is ongoing, MOIA will continue its work to assist launching NYC Care, so that all New Yorkers have access to quality and affordable health care.

Additional notable statistics from the report about immigrant New Yorkers include:

Population:

·        New Yorkers by Immigration Status: 62.8% U.S.-born citizens; 20.9% naturalized citizens; 11.0% green card holders or other status; 5.3% undocumented.

·         Top Ten Countries of Birth for Immigrant New Yorkers, from Highest Population to Lowest: Dominican Republic; China; Jamaica; Mexico; Guyana; Ecuador; Bangladesh; Haiti; India; Trinidad & Tobago.

·         Top Ten Languages of Immigrant New Yorkers with Limited English Proficiency (LEP), in Order: Spanish, Chinese, Russian, Bengali, Korean, Haitian, Arabic, French, Urdu, and Polish.

·         Nearly 60 percent of New Yorkers live in households with at least one immigrant.

·         Over one million New Yorkers live in mixed-status households, in which at least one person is undocumented.

·         Of these one million New Yorkers, 277,000 are children, and three-fourths of these children are U.S.-born citizens.

Economy:

·         77.4 percent of undocumented immigrants (age 16 and older) are in the labor force, compared to 64.9 percent of all New Yorkers.

·         Immigrant New Yorkers contributed $228 billion to the city’s GDP, over a quarter of its total.

Health:

·        22 percent of immigrant New Yorkers lack health insurance, compared to 7 percent of U.S.-born New Yorkers.

·         47.1 percent of undocumented New Yorkers lack health insurance.

·         18.6 percent of undocumented children (under age 19) in NYC lack health insurance, compared to 2.1 percent of U.S.-born children, even though universal coverage is available to all children regardless of immigration status in New York State.

The full report, which can be accessed here, has a wealth of additional information about immigrant New Yorkers, MOIA programming and advocacy, and more policy recommendations for federal and state policymakers, including enacting driver’s licenses for all New Yorkers.

The full report is available here.

The Next Public Meeting of the NYC Charter Commission 2019: March 21, 2019, 6:00 PM, Manhattan - City Hall

  New York City Charter Revision Commission 2019

Notice of Public Meeting
Thursday, March 21, 2019 at 6:00 p.m.
City Hall Council Chambers
City Hall, New York, New York 10007

The New York City Charter Revision Commission 2019 will hold an issues forum open to the public, at 6:00 p.m. on Thursday, March 21, 2019. The meeting will be held at City Hall in Council Chambers, City Hall, New York, New York 10007. This forum will include experts discussing land use issues including comprehensive planning, the Uniform Land Use Review Procedures and franchises and concessions, and such other matters as may be necessary in the Commission's review of recommendations and proposals for potential revisions to the New York City Charter.

This meeting is open to the public. Because this is a public meeting and not a public hearing, the public will have the opportunity to observe the Commission’s discussions, but not testify before it. There will be opportunities for testimony by members of the public at future public hearings of the Commission.

If you are not able to attend, but wish to watch the meeting, all public hearings and meetings will be livestreamed at the Commission’s website found here: www.charter2019.nyc.

What if I need assistance to observe the meeting?

This location is accessible to individuals using wheelchairs or other mobility devices. With advance notice, American Sign Language interpreters will be available and members of the public may request induction loop devices and language translation services. Please make induction loop, language translation or additional accessibility requests by emailing the Commission at info@charter2019.nyc or calling 212-482-5155. All requests will be accommodated to the extent possible.

Find out more about the NYC Charter Revision Commission 2019 by visiting us at our website: www.charter2019.nyc.

MAYOR DE BLASIO STATEMENT ON NEW YORK LEGISLATURE PASSING SPEED CAMERA PROGRAM EXPANSION

  “The Assembly and Senate deserve great credit in passing a dramatic expansion of our life-saving speed camera program. We will stop at nothing to aggressively pursue tools like speed cameras that we know slow down drivers and save lives around schools across the city. Vision Zero is working and more speed cameras will only deepen that progress on our streets.”

City of New York to Comply with the Federal Safe Drinking Water Act and Prevent Contamination of the City’s Drinking Water Supply

Under the Consent Decree, New York City Will Pay the United States a $1 Million Civil Penalty for Past Violations of Federal Requirements of the Safe Drinking Water Act

  Richard P. Donoghue, United States Attorney for the Eastern District of New York, Jeffrey Bossert Clark, Assistant Attorney General for the Environmental and Natural Resources Division of the United States Department of Justice, and Andrew Wheeler, Administrator of the United States Environmental Protection Agency (EPA), announced today that the United States filed suit under the Safe Drinking Water Act against the City of New York and the New York City Department of Environmental Protection (the City) for failure to cover the Hillview Reservoir (the Reservoir), located in Yonkers, New York, in violation of federal regulation and federal and state administrative orders.  A Consent Decree requiring the City to cover the Reservoir and pay a civil penalty was also lodged with the Court.  Following a 30-day public comment period, the United States will review the comments and, if appropriate, move for entry of the Consent Decree by the Court.

“The United States brought this action to ensure that New York City covers the Hillview Reservoir to protect the drinking water City residents receive from the Catskill-Delaware Drinking Water Supply.  This Office will continue to monitor and enforce the Consent Decree through completion of its requirements,” said United States Attorney Richard P. Donoghue. 

“Today we take the necessary steps to fix a serious public-health problem,” said Assistant Attorney General Jeffrey Bossert Clark for the Department of Justice’s Environment and Natural Resources Division.  “Congress enacted the Safe Drinking Water Act to ensure that every American has access to safe water to drink.  And we vindicate that Act by ensuring in our enforcement action that the City of New York will comply this federal law by protecting against contaminants aerially deposited into the Hillview Reservoir, which millions of New Yorkers depend for their everyday drinking water needs.”          

“New York City failed to comply with Safe Drinking Water Act requirements that keep drinking water safe from harmful bacteria and viruses, even when it was under an order to do so,” said EPA Administrator Wheeler. “EPA will ensure the City complies with the decree and takes the necessary steps to prevent its drinking water from harming the health of its residents.”

The Reservoir is part of New York City’s public water system.  It is an open storage facility and is the last stop for drinking water before it enters the City Water Tunnels for distribution to City residents.  The 90-acre Reservoir receives nearly a billion gallons of water each day through the Catskill and Delaware Aqueducts, and serves as a holding tank that allows the City to meet daily peak water demand.  It is divided into two segments, the East and West Basins.  Prior to the water entering the Reservoir, it receives a first treatment of chlorine and ultraviolet treatment.  Since the Reservoir is downstream of these treatments and is an open storage facility, the finished water[1] in the Reservoir is subject to recontamination with microbial pathogens, such as viruses, Giardia and Cryptosporidium, from birds, animals and other sources.  Giardia and Cryptosporidium are protozoa that can cause potentially fatal gastrointestinal illness in humans.  If the water in the Reservoir were to be re-contaminated, public health would be threatened, since sufficient microbial treatment is not available downstream of the Reservoir.  A cover is necessary to prevent recontamination by such pathogens.  Until the cover is in operation, the City is required to take active measures to control wildlife in and around the Reservoir and monitor the Reservoir to ensure that the water is safe for drinking.

The City has been required to cover the Reservoir since it first executed an Administrative Order with the State of New York on January 26, 1999.  On March 6, 2006, the City also became obligated to cover the Reservoir under federal regulation, specifically the Safe Drinking Water Act.  The regulation required uncovered finished water storage facilities, such as the Reservoir, to be covered by April 1, 2009, or for the discharge from the uncovered finished water storage facilities to be treated to achieve inactivation and/or removal of microbial contaminants.  In May 2010, EPA entered into an Administrative Order requiring the City to meet a series of milestones leading to the completion of a cover for the Reservoir.  The first milestone date was January 31, 2017.  The City failed to meet that date, and this lawsuit followed. 

The Consent Decree contains requirements for construction of two projects in addition to the cover, the Kensico Eastview Connection (KEC) and the Hillview Reservoir Improvements (HRI).  The KEC entails the construction of a new underground aqueduct segment between Kensico and Eastview that replaces the previously planned Catskill Aqueduct Pressurization Project.  The HRI requires extensive repairs to the Hillview Reservoir, including replacing the sluice gates that control water flow and building a new connection between the reservoir and water distribution tunnels.  The completion of the KEC is expected to take until 2035.  The City estimates the construction cost of the KEC to be approximately $1 billion.  The HRI project will be conducted concurrently with the KEC and is anticipated to be completed by 2033.  The City estimates the construction cost of the HRI to be approximately $375 million.  While the KEC and HRI construction and repair work are underway, the City will conduct facilities planning and design work for the Hillview cover.  Following the completion of the KEC and the HRI, the East Basin cover will be constructed, with expected commencement of full operation in 2042, and then the West Basin cover will be constructed, with expected commencement of full operation in 2049.  The City’s estimate in 2009 for the cost of its then planned concrete cover for the 90-acre Reservoir was $1.6 billion.  The actual cost of the cover may be lower, should the City choose a different type of cover.

Because the schedule in the Consent Decree is lengthy, and there is a possibility that the schedule could be accelerated under certain circumstances, the Consent Decree provides for potential acceleration.  The Consent Decree also requires the City to implement Interim Measures to protect the water until the Hillview Reservoir cover is in full operation including: (1) enhanced wildlife management at the Reservoir; (2) weekly sampling of source water for Cryptosporidium and Giardia at the Kensico Reservoir effluent(s), and Cryptosporidium and Giardia sampling at the Reservoir effluent; (3) quality control sampling of the Reservoir effluent; and (4) implementation of a Cryptosporidium and Giardia Action Plan for response procedures for elevated Cryptosporidium and Giardia at the Reservoir.

In addition, under the Consent Decree, the City will pay the United States a civil penalty of $1 million for its past violations of federal requirements.  The Consent Decree also provides that the City will pay New York State $50,000, and implement a state Water Quality Benefit Project in the amount of $200,000 to settle the State’s claim for penalties for violations of a State administrative order.

The civil negotiations and settlement were handled by the Office’s Civil Division.  Assistant United States Attorney Deborah B. Zwany is in charge of this matter, working together with  Elizabeth Yu, U.S. Department of Justice, Environment and Natural Resources Division, Phyllis Kaplan Feinmark, Regional Counsel’s Office, EPA Region 2, Doughlas McKenna, Chief of the Water Compliance Branch, EPA Region 2 and Nicole Kraft, Chief of the Ground Water Compliance Section, EPA Region 2, Gavin McCabe from the New York State Attorney General’s Office, and Roger Sokol from the New York State Department of Health’s Bureau of Water Supply Protection.

[1] Finished water is water that has been introduced into the distribution system of a public water system and is intended for distribution and consumption without further treatment, except as necessary to maintain water quality in the distribution system.