NEW YORK—The fallout from the corruption conviction of former Gov. Cuomo aide Joseph Percoco on Tuesday is being felt in Albany and in Orange County, where some local politicians are calling for the revocation of permits of a mostly completed power plant linked to the case.

Percoco, a former executive deputy secretary to Gov. Cuomo, was found guilty on Tuesday of soliciting and accepting more than $315,000 in bribes in return for assisting Competitive Power Ventures Inc. of Silver Spring, MD and Syracuse, New York-based real estate developer COR Development in business dealings with New York State. Percoco, 47 of South Salem, NY, was convicted of conspiracy to commit honest services fraud and solicitation of bribes and gratuities.

After an eight-week trial, the jury was deadlocked on corruption charges against former CPV executive Peter Galbraith Kelly Jr. COR executive Steven Aiello was convicted of conspiracy to commit honest services fraud, while another COR executive Joseph Gerardi was acquitted of all charges against him.

Competitive Power Ventures is in the final stages of construction of a $900-million 680 megawatt natural gas-fired energy plant in Wawaynda in Orange County.

At trial, the federal government charged Percoco with receiving more than $287,000 from CPV from around 2010 to the end of 2012. The bribe payments included approximately $90,000 paid to Percoco's wife for little work performed. The federal government alleged at trial that the bribe payments were made for Percoco's assistance to help CPV secure low cost state emission credits and a “lucrative long-term energy purchase agreement with the state” that would guarantee a buyer for the energy produced at the CPV plant that the federal government estimated would have saved CPV approximately $100 million in development costs.

In response to the conviction of Percoco, several Orange County officials have called for an investigation into the permits granted for the CPV Valley Energy Center project.

Orange County Executive Steve Neuhaus, who supported the project during its local approval process, said, “The state should revoke any and all permits granted to CPV. You cannot act illegally in the permit approval process and then keep the permits. When the arrests happened, I called upon the state to review all of the permits that were issued. Now that a conviction has been handed down, state officials must do more.”

He is calling for the introduction and passage of state legislation that would create “a presumption of invalidity for any project in which criminal conduct by public officials occurred and for which permits were issued.” Neuhaus then said the bill should be retroactive and apply to CPV Valley Energy Center's applications.

The Orange County Industrial Development Agency has announced it will conduct a full audit of the CPV tax incentive and PILOT agreements with the agency to ensure full compliance.

Tom Rumsey SVP, external affairs, Competitive Power Ventures in a statement stressed the allegations did not involve the local permitting approval process. “As we have stated from the beginning of this process, the alleged conduct does not reflect who we are as a company or what we expect from our employees,” Rumsey said. “At CPV, we make every effort to exceed all applicable ethical and legal requirements. The charges never alleged that the CPV Valley Energy Center project permits were obtained in an improper way and the validity of those permits has been upheld continuously by state and federal regulators and in state court.”

Gov. Cuomo also released a statement on Percoco's conviction. “While I am sad for Joe Percoco's young daughters who will have to deal with this pain, Iecho the message of the verdict—there is no tolerance for any violation of the public trust,” the governor stated. “There is no higher calling than public service and integrity is paramount—principles that have guided my work during the last 40 years. The verdict demonstrated that these ideals have been violated by someone I knew for a long time. That is personally painful; however, we must learn from what happened and put additional safeguards in place.”

Instant Insights /

Corruption Conviction Sparks Call for Power Plant's Permits

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