ALBANY — Former New York state Deputy Budget Director Sandra Beattie, who served in Gov. Kathy Hochul’s administration after first joining under former Gov. Andrew Cuomo, has agreed to pay a $5,000 ethics fine after acknowledging improper dealings with a well-connected lobbyist tied to an $11 million COVID-era state contract, newly released records show.
The settlement says Beattie maintained a close personal relationship with lobbyist Michael Balboni, whom she had brought in as a “volunteer consultant” on New York’s Excelsior Pass program, the digital COVID-19 health credential used by residents during the pandemic.
The Excelsior Pass, designed to verify vaccination or testing status, was handled through outside vendors and ultimately ran well above its original cost estimates.
Balboni, a former state senator who was named president of Adelphi University in June, later became a subcontractor for Deloitte, earning more than $100,000 through the state contract while continuing his friendship with Beattie, despite a recusal agreement barring him from lobbying the state budget office.
According to the agreement released Tuesday by the Commission on Ethics and Lobbying in Government, Beattie and her significant other spent four days with Balboni and his wife at the couple’s Florida home.
During that Florida trip, Beattie was also invited to speak at an event hosted by Balboni, further underscoring the overlap between their personal relationship and their state-connected professional ties.
Beattie admitted to violating New York state ethics laws and agreed to resolve the matter by paying the $5,000 penalty, according to the settlement.
“Ms. Beattie positioned a registered lobbyist, with whom she had a personal friendship and from whom she received personal favors, in a position to benefit greatly from contract work for the Office of Information Technology Services and its vendors,” commission Executive Director Sanford Berland said in a statement.
Balboni, who’s only referred to in the settlement as an anonymous lobbyist, has not been accused of wrongdoing.
But commission records show his firm Red Land Strategies was drawing at least $10,000 a month as lobbyist, raking in up to $300,000 as part of the arrangement, after initially being directly paid by the state as a subcontractor for Deloitte.
Beattie was caught signing an invoice to pay Balboni under the $11 million contract to set up the Excelsior Pass, a project that ran over four times over budget.
It was one of over a dozen contracts being shoveled to Deloitte at the time as the state was outsourcing hundreds of millions of dollars of operations contracts to the firm – such as answering unemployment insurance phone lines and other tasks during the pandemic.
Beattie was sacked by Hochul in March 2023 in the midst of state budget negotiations after she and former state IT department boss Rajiv Rao ended up on the radar of the New York Inspector General’s Office.
Rao, who also admitted to violating ethics laws in a settlement with the commission, was also featured as a speaker at Balboni’s lobbyist events and caught investigators attention when his agency awarded one of his clients a contract to buy T-Mobile phones shortly after one of the get togethers, the New York Times reported in 2023.
T-Mobile was a client of Balboni’s.
Rao also personally got Beattie a state-issued cellphone that did not include standard monitoring software to ensure records retention, the probe found. Beattie suspiciously wiped the phone clean before turning it in the day she was canned, according to the records.
The settlement also revealed that while Beattie was still first deputy budget firector in March 2021, Cuomo’s administration signed a non-disclosure agreement with Balboni “relating to the Registered Lobbyist’s involvement with the re-opening of a venue that was also a client of the Registered Lobbyist.”
Balboni represented the New York Nets at the time.
Hochul’s Press Secretary, Kara Cumoletti, said in a statement that the governor “has always been committed to restoring confidence in government.”
“That’s why when concerns were raised, the individual was terminated and the matter was immediately referred to the Inspector General,” the spokesperson said. “The Governor has been clear that her Administration has no tolerance for those who violate the public’s trust and all parties should be held accountable.”
Rich Azzopardi, a spokesperson for former Gov. Cuomo, declined to comment.
