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Kaloyeros is convicted in bid-rigging scheme

Kaloyeros is convicted in bid-rigging scheme

Architect of Cuomo’s Buffalo Billion project found guilty of wire fraud and conspiracy
Kaloyeros is convicted in bid-rigging scheme
Alain Kaloyeros, right, leaves federal court in New York, July 9, 2018.
Photographer: Holly Pickett/The New York Times

Alain E. Kaloyeros, a principal architect of Gov. Andrew M. Cuomo’s signature economic development initiative, known as the Buffalo Billion, was convicted on Thursday in a bid-rigging scheme that steered hundreds of millions of dollars in state contracts to favored companies in Buffalo and Syracuse.

Kaloyeros, 62, was found guilty of wire fraud and conspiracy in the fourth week of a federal trial in Manhattan that invited harsh scrutiny of Cuomo’s ambitious plan to revitalize upstate and western New York.

The case also was used by the governor’s political rivals to criticize what they say has been a culture of corruption enabled by Cuomo.

Cuomo, who has not been accused by prosecutors of any wrongdoing, has said repeatedly that he has “zero tolerance for abuse of the public trust from anyone.”

Kaloyeros, the former president of SUNY Polytechnic Institute, had been credited with helping to create a high-tech industry in the capital region, which led Cuomo, a Democrat, to place him in charge of the Buffalo Billion project. The governor had praised Kaloyeros as a genius and “New York’s secret weapon.”

But at the trial, the prosecution presented evidence that Kaloyeros and Todd R. Howe, a former lobbyist with ties to the Cuomo administration, conspired to defraud Fort Schuyler Management Corporation, a nonprofit real estate arm of SUNY Polytechnic, by steering lucrative contracts to LPCiminelli, a Buffalo construction management firm, and COR Development, a Syracuse-area firm.

As part of the scheme, Kaloyeros and Howe tailored requests for proposals, or R.F.P.s, to fit the firms’ specific qualifications and ensure that they be chosen by Fort Schuyler for the projects.

LPCiminelli, for example, received a contract to build what became a $750 million solar-panel plant along the Buffalo River, while COR received contracts worth more than $100 million for other projects. Both firms were clients of Howe’s.

“When Kaloyeros was entrusted by the State of New York to spend upward of a billion dollars of taxpayer money to prop up the economy of upstate New York, he turned around and shared the key to the vault with his friend Todd Howe and his clients,” a prosecutor, Matthew Podolsky, said in a closing argument on Monday.

Three of the firms’ executives — Louis Ciminelli of LPCiminelli, and Steven Aiello and Joseph Gerardi, of COR — also were convicted.

Michael C. Miller, a lawyer for Kaloyeros, denied in his summation that his client had rigged the procurement process.

“Governor Cuomo knew what he was doing when he picked Alain Kaloyeros to grab the reins of the Buffalo Billion project and make it a reality,” Miller told the jury.

“There was no bribe,” he added. “There were no trips. There were no fancy suits. There was no sweetheart deal. There was nothing. Alain Kaloyeros, start to finish, was doing his job.”

The judge, Valerie E. Caproni, scheduled the men’s sentencing dates for October.

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