Witnesses Tell How Percoco Gave Developers Access to the ‘Albany Game’

Sept. 30, 2015, was going to be a full day in Syracuse for Gov. Andrew M. Cuomo. He was to tour a historic hotel, visit the state fairgrounds and make an announcement at the Budweiser brewery outside the city.

Not on his schedule was a stop at the Aloft Hotel, a building project in a section of Syracuse known as the Inner Harbor. That was a disappointment to the hotel’s developer, Steven Aiello, whose staff had worked the two days beforehand to ready the site for Cuomo, even laying down a special green carpet in anticipation.

News of Aiello’s disappointment made its way to Joseph Percoco, one of the governor’s closest friends and most trusted advisers. The day of Cuomo’s visit, Percoco called a state official who was organizing the governor’s itinerary, with a simple message: “Get the governor to the project at the Inner Harbor.”

The official, Andrew Kennedy, testified that in the next half-hour, he scrambled to corral Cuomo’s staff, various state employees and reporters. The governor made it to the hotel. Photos were taken. One shows Cuomo and Aiello shaking hands. Another shows them looking around the hotel, the green carpet underfoot.

Much of the testimony in Percoco’s corruption trial in U.S. District Court in Manhattan has revolved around the influence and intimidation Percoco exercised as one of the governor’s top aides, and how prosecutors say he traded that influence for bribes. Percoco is accused of taking $35,000 from Aiello’s firm, COR Development, in return for official actions on the firm’s behalf.

But even as prosecutors have shown how power players like Percoco navigated “the Albany game,” as one witness put it, they have also shown how minor players in the game — Aiello and Joseph Gerardi, another executive in Aiello’s company — could get caught up in it.

Text messages, emails and testimony over the last few days have shown men who were eager for the attention of state officials, gleeful at the thought of outsmarting bureaucratic regulations, and indignant when they thought they had been overlooked.

“The administration has embarrassed me in my community,” Aiello wrote in a text message in September 2015 to Todd R. Howe, a lobbyist with ties to Cuomo and Percoco, after Aiello’s son, who worked in state government, did not receive as large a raise as he had expected. “I have been loyal as the day is long. They insult us like this. I’m finished!!!

“Everybody else gets what they need and want. I keep giving,” he continued. “It’s a sad statement!”

Howe passed the message to Percoco, who sent an email to administrative staff members demanding that they give Aiello’s son a 10 percent raise. They complied.

Percoco, Aiello and Gerardi, along with a fourth co-defendant, Peter Galbraith Kelly Jr., of Competitive Power Ventures, are on trial together. They have all denied any wrongdoing. Howe is expected to be the prosecution’s star witness. He pleaded guilty in 2016 to charges associated with the bribery scheme.

In the same phone call in which Percoco pressed to bring the governor to the Inner Harbor hotel, Kennedy testified that Percoco also conveyed Aiello’s displeasure that he had not been invited to drinks the night before.

Another time, Aiello asked Howe to press Percoco on funds the state had promised to COR but had not yet released.

“Out here in Syracuse and Steve is having a heart attack?” Howe wrote to Percoco.

The men were not always so unhappy with their treatment. In 2014, Aiello and Gerardi had emailed back and forth for weeks with state officials, trying to avoid a state requirement that might have forced them to hire union employees for a project. They were unsuccessful. They turned to Howe, who asked Percoco to intervene. Soon after, state lawyers reversed the requirement.

Emails from Aiello and Gerardi show they were in awe of — and more than a little giddy about — the victory.

“Totally Amazing,” Aiello wrote in an email to Howe. Of the official who had tried to enforce the requirement, he added: “He underestimated the power of TH, JP!”, a reference to Howe’s and Percoco’s initials.

Lawyers for Aiello and Gerardi on Wednesday cast them as amiable, well-intentioned executives who had been frustrated by the state government’s bureaucracy even as they admired the governor. (Aiello once organized a campaign fundraiser for Cuomo, because he believed in his “whole philosophy and what he was doing,” an FBI special agent testified on Tuesday that he had told her.)

But the lawyers also acknowledged the lengths to which the men went to try and earn the approval and recognition of top state officials.

“You see this green little carpet there?” Aiello’s lawyer, Stephen Coffey, asked Kennedy, referring to the photo of Aiello and the governor in the Syracuse hotel. “Were you aware that for two days prior to this, employees had worked day and night getting that — that’s the Aloft Hotel, right?”

“Getting that ready for the governor, were you aware of that?”

When Kennedy said no, Coffey asked what he had thought was the reason for Aiello’s displeasure.

“At the time, I thought it was because he wasn’t invited out for drinks,” Kennedy replied.