News Copy, New York

Faso Faces Additional Lobbying Conflicts

Our sources are telling us that former Assembly Minority Leader John Faso has come under even more pressure from his employer, Manatt, Phelps and Phillips, LLP, since his position as a candidate is leaving the high profile lobbying firm exposed as a liberal lobbyist helping a Republican candidate.

The Democrat-close lobbying firm has been getting a Republican-light reputation with Faso under their wing.

"Chuck Manatt, the firm’s founder, is a major Democratic Party power broker and banker who served as chairman of the Democratic Party and as U.S. ambassador to the Dominican Republican."

Manatt is reported to be seeking another horse in the race for governor -- if Faso doesn't secure a Republican endorsement by the first of the year.

Manatt's interest in Faso has everything to do with buying into a gubernatorial candidate who can influence the State Legislature to increase Medicaid spending, our souces explained, and that he apparently guaranteed his employers his endorsement by December.

Faso co-hosted a presentation in January this year entitled the Power of the Minority with State Senate Minority Leader David Patterson, where Patterson was described as "leader of the growing number of Democrats in the State Senate."

Faso is apparently still employed with Manatt, Phelps and Phillips -- though we imagine that this must be an oversight on the firm's website.

"John Faso’s experience focuses on local, state and federal political and government advocacy in the healthcare, energy, transportation, financial services and insurance industries."

Meanwhile, our sources insist Faso will continue lobbying into 2006.  We have been told that he has refused to cut his ties with this liberal lobbying operation -- but that he will be getting an ultimatum soon.

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As News Copy reported earlier, Faso's campaign is coordinated by two lobbyists, Susan Del Percio and Bill O'Reilly of O'Reilly Strategic Communications had been knee deep in contracts with the Medicaid-hungry 1199 union.  How knee deep?  News Copy has discovered another 1199-related company that O'Reilly and Del Percio did lobbying for -- right up until the last week of November -- when they were already hired by Faso to run his campaign.

It's expected that Faso's campaign finance disclosure will show that he had hired O'Reilly and Del Percio while they were still in the employ of 1199-connected PACs, not illegal by any stretch of the imagination but our sources made it clear that Eliot Spitzer will have a field day with Faso over these conflicts.

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Despite his sarcastic disrespect of U.S. Senate candidate John Spencer, Adam Brodsky's critique of Republican fortunes was well-put in respect to Joe Bruno.

Principles? Fuhgettaboutit.

"You've got to get elected before you can serve," Bruno said.

Meaning that if the unions want fat raises, the majority leader wouldn't think twice about spending your money to grant them that — in the name of getting elected, you see.

One wonders how "the growing numbers of Democrats in the State Senate" feel about that.

Faso Lobbying Revelations

News Copy has reported extensively on John Faso hiring Dennis Rivera's two lobbyists, 1199 stalwarts Susan Del Percio and Bill O'Reilly.

Now sources have stepped forward with a more disturbing linkage between John Faso and Assembly Democrats, including Cuomo Democrats.

The two fellow lobbying partners in question are former Cuomo administration counsel James W. Lytle and former counsel to Assembly Speaker Sheldon Silver, Karen Lipson.

First, John Faso is still listed as a Partner with Manatt, Phelps and Phillips. 

He's still a lobbyist and our sources tell us that he's still betting on both options; statewide race or a continued career as a lobbyist.  Repeated sources have also told us that prospective donors are being told that they will get their money back, if Mr. Faso does not run.

As Manatt's counsel on the healthcare industry, Karen Lipson is key state lobbyist and a close friend of Albany Democrats. 

From 1994 to 2000, Ms. Lipson served as an associate counsel on the staff of New York State Assembly Speaker Sheldon Silver.

The word we're hearing is that Lipson needs a good horse in the race, namely Faso, but that she will withdraw her help if Faso does not get a Republican endorsement soon.

Faso's lobbying partner is just as likely to back Andrew Cuomo, as is fellow partner James Lytle.

Mr. Lytle served as Assistant Counsel for Health and Human Services to Governor Mario M. Cuomo from 1983-86.

These aren't imagined allegations we're drawing here.  The following was in Lytle's lobbying firm's biography:

"Mr. Lytle’s practice focuses primarily on the highly regulated area of healthcare law and regulation and involves the representation of clients before the Legislature, the executive branch and the courts."

Faso's lobbying partner argues in court for the very entities trying to stop Medicaid reform -- or at least what liberal Democrats like Eliot Spitzer don't believe is reform.

News Copy admittedly had to read it a few times to get a sense of Lytle's hidden agenda but the Manatt lobbying firm had this opinion of a recent court decision on Medicaid payments to 1199-connected healthcare providers.

In Matter of Visiting Nurse Service of New York Home Care v. New York State Department of Health, New York’s Third Department Appellate Division upheld due process rights for a home health agency that challenged New York State’s recoupment of Medicaid payments, which the State contended should have been billed to Medicare.

The following statement written by Faso's lobbying partner makes New York State sound like the enemy.

"Faced with ever-escalating Medicaid expenditures and diminishing state resources, many states have embarked upon increasingly aggressive and creative auditing and recoupment strategies to reduce Medicaid expenditures.  While hospitals, nursing homes and physicians have long been targeted by these efforts, the growing share of Medicaid and Medicare funds devoted to community-based care, such as home healthcare services, has drawn increasing attention by healthcare auditors and enforcement agencies."

This additional statement penned by Lytle makes it very clear who he is working for -- and the kind of litigants Faso keeps company with:

"Characterized by the New York Law Journal as “a case of major importance to health care providers,: the case may provide health care entities with broader due process and hearing rights to protect themselves from overly aggressive Medicaid auditors."

Over the past few days, News Copy has watched while anonymous political entities (possibly someone's campaign or the State Republican Committee itself) have ripped into the campaign of Randy Daniels for supposedly circulating this information.

What we have posted today on News Copy -- for the first time -- are neither allegations nor a political effort by one of John Faso's opponents.

These are facts, folks.  None have been created or alleged.  They exist in the public domain and we have responsibly attributed every detail.