running bill

Chelsea Hotel Steers Donations to de Blasio While Seeking Construction OK

The famed Chelsea Hotel, on July 30, 2019.
The famed Chelsea Hotel, on July 30, 2019. Photo: Ben Fractenberg/THE CITY

Starting nearly a year ago, the owners of the historic Chelsea Hotel needed City Hall to approve their multimillion-dollar plan to turn the grungy landmark into a shiny luxury hotel with a rooftop lounge.

Rent-stabilized tenants living in the hotel were accusing the owners of trying to force them out, and filed complaint after complaint with the city.

Beginning last August, owners Ira Drukier and Richard Born began steering tens of thousands of dollars in political donations to the mayor, records show. By June, 18 checks totaling $57,400 had been sent to de Blasio’s presidential campaign and his two political action committees, according to public records.

The checks often arrived on the same day in bundles. They were written by Drukier and Born, their wives, employees of their hotel empire and a limited liability corporation called RBA 42 LLC that they control, records indicate.

All told, the effort raised $22,400 for de Blasio’s presidential campaign and $35,000 for his state and federal Fairness PACs, financial disclosure records reviewed by THE CITY show. Federal law limits PAC donations to $5,000 per individual, and campaign donations to $2,800.

Meanwhile, the owners applied to de Blasio’s housing department for a Certification of No Harassment, a document asserting they weren’t illegally pushing out protected tenants, records show. They need it to finish what they started: turning the famously funky destination for rock stars and poets into a ritzier destination.

A review by THE CITY shows the check-writing followed the intervention of city agencies in response to complaints from the tenants — and grew after the owners applied for the no-harassment certificate.

In January, a handful of Chelsea Hotel tenants sued the owners and the city Department of Buildings, alleging that ongoing construction at the hotel was illegal because the owners had not received a no-harassment certificate.

On Feb. 15, the owners filed an application for such a certificate with the city Department of Housing Preservation & Development. As of this week, it’s pending.

Mayor’s Fundraising History

The city Department of Investigation previously cited de Blasio for violating city ethics rules for seeking donations from people actively doing business with City Hall to raise money for a now-defunct non-profit he controlled. THE CITY has documented that he has continued to do this with donors to his Fairness PAC.

His campaign has acknowledged that de Blasio has personally solicited donations for his Fairness PACs.

Mayor Bill de Blasio holds a press conference at Trump Tower, May 13, 2019.
Mayor Bill de Blasio holds a press conference at Trump Tower, May 13, 2019. Photo: Ben Fractenberg/THE CITY

Olivia Lapeyrolerie, a spokesperson for de Blasio’s presidential campaign, declined to comment when asked if he personally solicited contributions from the Chelsea Hotel owners. The owners did not respond to questions from THE CITY.

The mayor has insisted he won’t take money from anyone doing business with the city, and that he relies on the so-called “doing business” database to vet potential donors. But the database, which includes lobbyists, unions and vendors, covers only executives with entities engaged in contracts and certain other transactions with city agencies.

That doesn’t include the Chelsea Hotel owners and others seeking favors from City Hall.

Asked about the pending no-harassment application from the Chelsea Hotel donors, Lapeyrolerie said, “The mayor has gone above and beyond the law in refusing to take contributions from anyone in the doing business database.”

In this case, the mayor’s donors — who operate a network of boutique hotels across the city and bought the Chelsea in 2016 — are being accused of trying to force out rent-stabilized tenants to open up a luxury hotel.

The iconic building that has housed a parade of legends, from Leonard Cohen to Janis Joplin. Sex Pistols’ bass player Sid Vicious allegedly fatally stabbed his girlfriend, Nancy Spungen, in a room at the Chelsea in 1978.

‘Reporting to the Big Dog’

Most of the floors are now a bleak construction site of plywood walls, dangling wires and padlocked empty rooms. The site is the subject of a partial stop-work order while the no-harassment application is pending.

Jonathan Berg, one of five tenants named as plaintiffs in the lawsuit, declined to discuss the case. But he did praise the “professionalism” of the city inspectors who’ve been responding to tenant complaints at the Chelsea for months.

The inside of the Chelsea Hotel was a construction zone while developers worked to convert it into a luxury stay, as seen on July 30, 2019.
The inside of the Chelsea Hotel was a construction zone while developers worked to convert it into a luxury stay, as seen on July 30, 2019. Photo: Greg Smith/THE CITY

The city inspectors “are all nice people but they’re all reporting to the big dog and that’s DB,” said Berg — referring to de Blasio.

In their complaint, the Chelsea tenants ask the judge to halt all construction until the owners either obtain a no-harassment certificate from City Hall or are declared by the city to be exempt from that requirement.

The owners’ began raising money for de Blasio in August 2018, shortly after city building inspectors began responding to multiple tenant complaints about hazardous conditions amid ongoing construction. On Aug. 29, Born, Drukier and their wives wrote a total of eight checks to the two de Blasio PACs, raising $20,000 that day.

A Lawsuit and Violations

On Nov. 14, the Buildings Department issued a partial stop-work order that was expanded five days later to a full stop-work order, city records show. On Jan. 22, the tenants filed their lawsuit.

On Feb. 15, the Chelsea Hotel owners applied for the Certification of No Harassment, and asked that the stop-work order be lifted while the application was under review. Eleven days later, the city Department of Buildings granted them a partial victory, allowing work to proceed on certain parts of the hotel, records show.

On March 4, Born and Drukier raised another $15,000 for de Blasio’s state PAC.

The landmarked hotel has plaques acknowledging its famous former residents.
The landmarked hotel has plaques acknowledging its famous former residents. Photo: Ben Fractenberg/THE CITY

At the time, de Blasio was openly floating the idea of running for president. On May 16, he formally announced.

Fifteen days later, eight checks totaling $22,400 from Born, Drukier, various relatives, two of their employees and the LLC they controlled went to de Blasio 2020, the mayor’s presidential campaign fund.

THE CITY submitted a list of questions about the timing of the checks to a public relations representative and an attorney for Born and Drukier. They did not immediately respond.

On Tuesday, a spokesperson for the city Department of Housing Preservation & Development said the no-harassment certificate is pending. Since May, HPD inspectors have been in the building eight times, issuing 44 violations for a wide variety of problems, city records shiow.

On July 24, HPD inspectors issued the latest violations at the Chelsea Hotel after finding what they described as “broken or defective fire retardant material on ceiling and all walls in public hall” of the eighth and 10th floors.

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