October 26, 2004
Contractor Tells of Tax Pledge in Stamford
By ALISON LEIGH COWAN, NY TIMES

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STAMFORD, Conn., Oct. 25 - A contractor who did excavation work at the home of Mayor Dannel P. Malloy of Stamford said Monday that he was assured by the mayor's brother that the city would lower his back taxes if he agreed to cut the $25,000 bill by almost half.

In phone interviews on Monday, the contractor, Alex Ferrara, said that he had told members of the state's new public integrity unit that the proposition had been made to him after he completed the work and was trying to get paid for it. He said the public integrity investigators had sought him out as part of their inquiry into Stamford's city government and Mr. Malloy, its third-term Democratic mayor.

Mr. Ferrara said he worked on the mayor's house in the late 1990's and did $25,000 in work, but was asked by the mayor's brother, Kevin Malloy, to wipe off some $10,000 in charges. He said he agreed, in return for a promise that he would get relief from about $80,000 in back taxes that he owed.

Mr. Ferrara said - and a city official confirmed - that the tax relief never came through.

The mayor "just used his power to get money off his house," Mr. Ferrara said.

He said others who worked on the house were also shortchanged.

"He just figured he'd get what he wants," Mr. Ferrara said. "He's a thief."

In an interview, Mayor Malloy said he was "dumbfounded" by Mr. Ferrara's account. "That just is an impossibility," he said. He said he remembered paying Mr. Ferrara $15,000 for his work and said the bill was paid in full.

"I didn't know Alex was angry," he said. He also said he had "no knowledge" of any such discussions between his brother and Mr. Ferrara.

Reached late Monday, Kevin Malloy said it was Mr. Ferrara who had raised the possibility of his interceding with his city tax problems.

"He said if I could get his taxes done, he would forget the bill," Kevin Malloy said. "And I said that's not how this works."

The mayor's brother added, "It's illegal, and I would never subject my brother to anything like that."

Two persons with knowledge of the public integrity unit's inquiry confirmed that state investigators have spoken with Mr. Ferrara and they were investigating his version of events. They said it was part of a broader investigation into whether contractors who have ties to the mayor got favorable treatment from his administration.

Dannel Malloy has been touted as one of the Democratic Party's best hopes of recapturing the governor's mansion in 2006, and by Sept. 30 he had raised more than $1 million for a campaign.

Stamford Republicans have in recent weeks been raising questions about possible relationships between city contractors and contributors to Mr. Malloy's three mayoral campaigns, his political action committee and his campaign fund for governor.

Such political contributions are generally legal, as long as there is nothing promised or given in return.

Questions raised about the way two lucrative city contracts involving a nursing home and a cafeteria were awarded to large donors of the mayor prompted Mr. Malloy to order them to be re-bid.

Investigators are now said to be looking into Mr. Malloy's home, a century-old barn that he and his wife own that sits on a street featuring some of Stamford's grandest waterfront estates.

Among those who assisted Mr. Malloy in acquiring the home and land or renovating the home are the city's fire and rescue chief and the head of the police commission. Both were appointed to their current positions by Mr. Malloy, who took office in late 1995.

Two others who worked on the home were given contract work by the city, the mayor said on Friday, confirming a published report in The Norwalk Hour from November 2001.

Mr. Ferrara has told state prosecutors that his work on the home included helping to prepare the land so the barn could be moved to its current plot. He said he billed Mr. Malloy roughly $25,000, but had trouble collecting. He said the mayor's brother, Kevin, a construction executive who is now retired, then offered him a deal: He would help him obtain tax relief on the more than $80,000 in back taxes he owed the city from two properties he bought for investment if he would discount his bill. Mr. Ferrara said Kevin Malloy also offered to obtain employment for him with the city if he waived the entire bill.

Mayor Malloy said Monday that his brother was "around a lot, but was not a person in charge of my renovation." However, Kevin Malloy's name appears on the building permit, issued in January 1998, as the contact person for questions concerning the renovations at the house. Asked about that, the mayor amended his statement to note that "maybe at that time he was the contact person, but no, he did not play a major role in the house."

Kevin Malloy said on Monday night: "I handled the start-up of the job. The only thing I had to do with it was I think I filed the building permit and I got the job rolling."

Mr. Ferrara said he eventually accepted less than what he was owed only because he was "desperate for the money." He said he was only able to collect the $15,000 that eventually came to him because he agreed to sign a document stating he had been paid in full and that no other promises had been made to him. He said he no longer has the document.

In all the discussions, he said, he never dealt with the mayor himself. Kevin Malloy agreed that Mr. Ferrara never dealt with his brother.

"I was dealing with Kevin," Mr. Ferrara said. "Kevin is the front man for the mayor who does the dirty work, so the mayor's hands are clean. The Malloys are just no good."

Dannel Malloy, whose annual salary is $114,000, practiced law for a well-connected firm in town for nearly a dozen years before becoming mayor in 1995, and he and his wife have successfully rehabilitated a number of Stamford properties before moving into their current home. His wife is employed by a nonprofit organization.

The house is on a block of million-dollar homes and has an upstairs view of Long Island Sound. Asked about how he afforded the house and extensive renovations, the mayor said he still had outside income from teaching and from his law practice and that he would be willing to share specific information with investigators.

Connecticut has had a series of investigations related to the homes of its politicians and work by contractors. In the case of John G. Rowland, the former Republican governor, the revelation that state contractors had overhauled his vacation home on Bantam Lake and provided other lavish gifts fueled a criminal investigation that still hangs over his head.

In another high-profile municipal corruption case, federal prosecutors convicted Joseph P. Ganim, the Democratic mayor of Bridgeport, last year based in part on gifts he accepted including free improvements to his home in the affluent Black Rock section of town.

In interviews on Friday and over the weekend, Mr. Malloy said that he welcomed the state's inquiry and expressed confidence that it would conclude that Stamford's policies and procedures are a model for the entire state. The city, on Interstate 95 in the prosperous southeast corner of the state, is Connecticut's fourth largest. Urban and diverse, it has exemplary bond ratings in recent years, a reflection of its huge tax base made up of corporate headquarters and its expensive homes.

But Republican leaders, who have smoldered silently for nine years as Mr. Malloy used a broad mandate from the city's heavily Democratic voters to consolidate power and reward supporters, have been grumbling about the mayor's home, city contracts and capital spending projects for the city's schools. Overseeing many of the school projects has been Alfonso F. Barbarotta, a political supporter of the mayor and one of his campaign donors.