STATE OF NEW YORK LEGISLATIVE ETHICS COMMISSION ________________________________________________________________________ IN THE MATTER OF PEDRO ESPADA, JR.

FORMER STATE OR NEW YORK SENATOR

NOTICE OF REASONABLE CAUSE

________________________________________________________________________

FINDING OF REASONABLE CAUSE FOR VIOLATION OF PUBLIC OFFICERS LAW 73(14)(a) and 74(3)(d)PROHIBITING HIRING OF RELATIVES AND SECURING UNWARRANTED PRIVILEGES The Legislative Ethics Commission (Commission) hereby finds that there is reasonable cause to believe that while former Senator Pedro Espada, Jr. was in office he participated in the decision to hire his uncle Juan A. Feliciano, Jr., a/k/a John Feliciano, for a job as a Special Assistant to New York State Senator Pedro Espada, Jr. in violation of Public Officers Law 73(14)(a) and 74(3)(d). JURISDICTION OF THE COMMISSION The Legislative Ethics Commission was created by the Public Employees Ethics Reform Act of 2007 (Chap. 14, L. 2007) which was signed into law on March 26, 2007. This legislation eliminated the former Legislative Ethics Committee and established Legislative Ethics Commission comprised of both members of the legislature and non-legislative members and revised the provisions of the Public Officers Law under the Commissions jurisdiction. The Commission is authorized by Legislative Law 80(7)(1) to conduct investigations and carry out such proceedings as are authorized and necessary to enforce the provisions of Public Officers Law 73, 73-a or 74. Pursuant to this power and duty, the Commission may administer oaths or affirmations, subpoena witnesses, compel their attendance and require the production of any book or record which it may deem relevant and material to such investigation. Pursuant to 80(10)(c) of the Legislative Law, the jurisdiction of the Commission continues notwithstanding that a member of the legislature separates from state service provided that the individual is notified of his or her alleged violation of the law within one year of his or her separation from state service. In cases where the Commission finds there is reasonable cause to believe that a violation of Public Officers Law 73, 73-a or 74 occurred, the Commission will conduct an adjudicatory hearing where the respondent has the right to be heard. The Commission is empowered to assess a civil penalty or, in lieu thereof, refer the violation to an appropriate prosecutor, depending upon the facts and circumstances. Legislative Law 80(10)(6) provides that if the Commission determines that there is reasonable cause to believe that a violation has occurred, in the case of a

senator, it shall send a notice of reasonable cause: (i) to the reporting person; (ii) to the complainant if any; and (3) in the case of a senator, to the Temporary President of the Senate. THE COMPLAINT AND THE APPLICABLE LAW Juan A. Feliciano, Jr., also known as John Feliciano, has been employed in various positions by the New York State Legislature. In his most recent position, from January through November 2009, he served as a Special Assistant to Senator Pedro Espada, Jr. In April 20, 2010, then-Attorney General Andrew Cuomo filed a lawsuit against Senator Pedro Espada, Jr. and a number of former officers and directors of the not-for profit corporation Comprehensive Community Development Corporation, known as Soundview, where Mr. Espada was the President and CEO. In that lawsuit the Attorney General described Juan A. Feliciano, Jr. as Senator Espadas uncle. Previously, Senator Espada had publicly stated that Mr. Feliciano was not his uncle. Based on the conflicting public statements of Senator Espada, the Commission commenced an investigation of a possible violation 73(14)(a) and 74(3)(d) of the Public Officers Law. Under Rule 3.01 of the Rules of the Legislative Ethics Commission [a]n investigation may be initiated by the Commission on its own or in response to a sworn complaint. Public Officers Law 73(14)(a) provides in pertinent part that [n]o statewide elected official, state officer or employee, member of the legislature or legislative employee may participate in any decision to hire, promote, discipline or discharge a relative for any compensated position at, for or within any state agency, public authority or the legislature. Public Officers Law 74(3)(d) provides that [n]o officer or employee of a state agency, member of the legislature or legislative employee should use or attempt to use his or her official position to secure unwarranted privileges or exemptions for himself or herself or others, including but not limited to, the misappropriation to himself, herself or to others of the property, services or other resources of the state for private business or other compensated nongovernmental purposes. The Commission has previously determined that the terms participate in the hiring of a relative shall be broadly interpreted. Public Officers Law 73(14)(a) prohibits participation by a member in the hiring of a relative for a compensated position within the legislature. Participation under the statue occurs when the legislator has any authority in the process of a relative being hired, even if the involvement is solely administrative, such as signing a Personnel Action Request. Under Public Officers Law 73(1)(m), a relative of an individual is defined as any person living in the same household as the individual and any person who is a direct descendant of that individuals grandparents or the spouse of such descendant. The definition of relative is broad enough to include a person who is a direct descendant of only one grandparent of an individual. N.Y.S Legislative Ethics Commn Op. (Feb. 16, 2011).

THE COMMISSION INVESTIGATION After duly voting to investigate, the Commission provided Senator Espada notice of the Commissions inquiry pursuant to Legislative Law 80(10)(a). Senator Espada was given 15 days to respond to the Commissions notice as provided by statute, however, the Commission received no return communication from Senator Espada or his legal representative. Subsequently, the Commission proceeded with the investigation and also appointed Special Counsel to provide assistance. In the course of it investigation, the Commission utilized its power to both subpoena records and witnesses and to demand information. The Commission obtained information about Juan A. Feliciano, Jr.s employment history with the legislature. The Commission found that, more recently, Mr. Feliciano was hired on January 2, 2009, as a Special Assistant to Senator Espada at an annual rate of $80,000. That employment was to continue to March 31, 2009. In March 2009, the employment was extended up to December 31, 2010. On November 25, 2009, Mr. Felicianos employment was terminated. Because Mr. Feliciano worked directly for Senator Espada, the Senator was the Appointing Authority for the position and was also listed as Mr. Felicianos supervisor for time and attendance. Senator Espada signed Mr. Felicianos Employment Application and Recommendation form on January 21, 2009 as the Appointing Authority under the statement: The above person is recommended for employment and is to be assigned to me. On March 11, 2009, Senator Espada signed a change of Employment Status form extending Mr. Felicianos employment. The Special Counsel also interviewed and obtained sworn testimony from Victor Feliciano. Victor Feliciano is Senator Espadas uncle. Victor Felicianos parents are Juan A. Feliciano, Sr. and Maria Ortiz. Mr. Feliciano, Sr. and Ms. Ortiz had several children, including Victor and Angelita Feliciano. Mr. Feliciano Sr. also had a son with a woman named Maria Antonio Feliciano. That son is Juan A. Feliciano, Jr. Angelita Feliciano married Pedro Espada, Sr. Together they had a son named Pedro Espada, Jr., who became a New York State Senator. Senator Espada is the nephew of Juan A. Feliciano, Jr. They are both direct descendants of Juan A. Feliciano, Sr. The Commission found that Mr. Espada participated in the hiring of Mr. Feliciano and that they were related. As a result, the Commission finds that there is reasonable cause to believe that a breach of the ethics laws, specifically Public Officers Law 73(14)(a) and 74(3)(d) prohibiting the hiring of relatives and securing unwarranted privileges for oneself or others, has occurred. Pursuant to Legislative Law 80(11), for certain violations of Public Officers Law 73 and 74, the Commission may either impose a civil penalty or, in lieu of imposing a civil penalty, 3

refer a violation to the appropriate prosecutor. Such violation or violations shall be punishable as a class A misdemeanor. CONCLUSION Based up on a review of all materials, proceedings and findings before the Commission to date, the Legislative Ethics Commission has found reasonable cause to believe that former Senator Espada violated Public Officers Law 73(14)(a) and 74(3)(d). By virtue of the fact that the violation occurred while Mr. Espada held the office of State Senator, this Notice of Reasonable Cause is also transmitted to the Temporary President of the Senate as required by Legislative Law 80(10(b). The Commission also notes that Mr. Espada was duly notified of his opportunity to be heard prior to the Commissions vote on November 30, 2011 to issue a Notice of Reasonable Cause, however he declined to exercise that opportunity. Notice of an Adjudicatory Hearing, at which former Senator Espada has the right to be heard, will be sent to Mr. Espada within fourteen (14) days of this notice.

Dated: December 9, 2011

Senator Andrew J. Lanza Co-Chair 4

Assembly Member Daniel ODonnell Co-Chair

Legislative Ethics Commission

All Concur: Senator Velmanette Montgomery Assembly Member Tony Jordan Mr. Pat Bulgaro Peter V. Coffey, Esq. Mr. John J. Nigro