Percoco trial: Jury learns how Todd Howe got Joseph Percoco consulting fees

A disgraced lobbyist detailed for a federal jury Tuesday how he tried to find consulting fees for Joseph Percoco in 2014 when the longtime confidant of Gov. Andrew Cuomo left work in the governor's office to run Cuomo's re-election campaign.

The effort began early that year when Percoco told Todd Howe of the need for "ziti replenishment" - ziti being the term the two longtime friends relied on when they talked about bribe money, prosecutors contend.

Howe eventually managed to funnel $35,000 to Percoco from one of his clients, Cor Development, and got another client to send $27,000 Percoco's way.  

But he so wanted to keep his friend happy that he kicked in another $25,000 of his own money.

"I wanted to make sure he got the money he needed," Howe testified Tuesday at Percoco's federal corruption trial. "I felt obligated to live up to my commitment to help Joe."

Howe, the government's main witness, spent his second day testifying Tuesday against Percoco and three executives, detailing alleged bribery schemes in which Percoco got paid for helping Cor Development and Competitive Power Ventures in their business dealings with the state.

Cor executives Steven Aiello and Joseph Gerardi are accused of paying Percoco the $35,000 for his help with their redevelopment of Syracuse's Inner Harbor.

And Peter Galbraith Kelly, a former CPV executive, is accused of funneling nearly $290,000 to Percoco for his efforts to benefit CPV's New Jersey power plant and the company's proposed plant in Wayawanda, in Orange County.

Days after Cuomo's election in 2010, Howe said he was introduced to Aiello and Gerardi by former Syracuse Mayor Tom Young, who thought he could help with their plan plan for the Inner Harbor. Within a week, Howe's Albany law firm  was hired for $6,500 a month to help Cor with its proposal to the city, with political strategy and to connect them to people in the new administration who could help them get state projects.

The following April, Howe arranged for the company executives to meet Cuomo at a fundraiser. He made sure the governor connected with Aiello's cousin and fellow Cor executive, Jeff Aiello, like Cuomo a collector of Corvettes. The two hit it off talking cars for more than half an hour, Howe testified.

That led Aiello to arrange a breakfast meeting with the governor at his cousin's garage full of vintage Corvettes - with the company contributing $125,000 to Cuomo's campaign using several of its more than 35 limited liability corporations. Howe encouraged Aiello to donate from the ones without Cor in the name so that the media would be less likely to highlight the contributions when reporting on the company's increased involvement with state government.

Howe was also paid hundreds of thousands of dollars on the side in an arrangement he never told his firm about. He got annual bonuses of between $100,000 and $250,000 beginning in 2012; the company covered his leases for Mercedes and Porsche SUVs; and it even gave him an $85,000 loan in the summer of 2015 for renovations on his new home in Washington.

Howe was expected to repay the loan later that year and he gave Aiello a check that would be deposited at the end of December. But he claimed that just before Christmas, Aiello told him he was forgiving the loan.

The next month, Howe said, he told Aiello about the FBI investigation and suggested that they document the forgiving of the loan. 

Howe soon got documentation from Gerardi, which indicated the loan was extended for six months but not forgiven. But he didn't think he would owe the money because of what Aiello had told him.

He later learned that the check he had given was deposited on the day that there were media reports he was a cooperating witness for federal prosecutors. He didn't have the money in the account. A lawsuit Cor filed is still pending.

In 2014, Cor needed help to avoid a labor peace agreement that the state was looking to require for a parking lot connected to the hotel the company was building in the Inner Harbor.

For help with that matter, Howe said, Aiello was willing to use Percoco as a labor consultant. But he wanted to pay the money to Howe's firm. Howe knew the firm would not agree to that and offered to pay through a company he had set up to get side payments from CPV, Potomac Strategies.

Howe got the $35,000 from Cor and sent Percoco checks of $15,000 and $20,000 made out to his wife from Potomac Strategies.

The ziti references had begun two years earlier when Percoco pressed Howe to get his wife a job with CPV.  

Shortly before Christmas in 2012, Howe let Percoco know their months-long effort to land Percoco's family a second income had finally paid off.

"Ziti delivered in wife's hands," Howe wrote in an email

But Percoco didn't seem completely satisfied by the $7,500 - which would be the monthly amount Lisa Percoco would get from CPV for the next three years.

"Only one month, Herb", he responded, using their nickname for each other, and indicating he thought her first payment would cover two months.

WITNESS: Howe takes the stand against Percoco, others

PAYMENTS: Money to Percoco's wife kept from company executives

Howe told Assistant US Attorney Janis Echenberg that Percoco did show his appreciation in the ensuing months.

"Joe had always been responsive to me," Howe said. "He appeared to me to be more responsive when issues surfaced from Braith (Kelly). He seemed to be more focused and responsive."

The witness has testified that Percoco pressed him for months about the CPV job with his wife, often letting him know how his finances were strained since the couple moved that year to South Salem. The same pattern repeated itself in 2014 when Percoco left the governor's staff to manage Cuomo's re-election campaign.

In a June email, Percoco asked Howe "where the hell is the ziti??? :)

In another email the following month, Percoco wrote "I have no ziti Herb. None." He wished Howe a good vacation, bemoaning that his own kids' summer fun would consist of a trip to the backyard with a garden hose.

Howe, 58, has moved to Idaho and is working at a golf course. He pleaded guilty to eight felonies in 2016 for his role in the alleged schemes and for arranging side income with his firm's clients that he hid from the firm and failed to report to the IRS.

Defense says witness lying

Defense lawyers maintain that he is lying about the bribery in hopes of significantly reducing the 130 years in prison he potentially faces. They contend that any payments to Percoco and his wife were legitimate business expenses or favors with no expectation that he take action for them on business they had with the state.

Prosecutors have countered that if Howe lies, they will no longer go to bat for him at sentencing as his cooperation agreement calls for.

Howe acknowledged Monday never registering as a lobbyist in New York as he should have for the work he was doing for multiple clients. He suggested that it was another top Cuomo aide, Howard Glaser, who steered him away from registering but said he ultimately did not because it "would have curtailed what I could do."

Howe has described playing a key role in Percoco's career and said they were like brothers. He hired him to work for then Gov. Mario Cuomo in the 1980s.

When Cuomo lost re-election in 1994, Howe said he helped Percoco land two federal jobs, first in the New York office of the US Treasury and then at the Department of Housing and Urban Development, where Howe was a top assistant under HUD secretary Andrew Cuomo.

After months of cajoling from Percoco, Howe eventually got Kelly to give Lisa Percoco a job working on the company's community education effort. But her name and picture were kept out of promotional material. And a senior vice president testified last week about Kelly's efforts to keep her employment secret even from company executives.

Howe said Percoco was aware he could not be arranging a job for his wife while he was advocating for CPV in the governor's office. He cited an email in which Howe told Kelly he needed to "try and hammer something out for JP" adding "(Percoco) wants to try and stay removed if possible if u know what I mean."

CPV was using Percoco for help in obtaining a power purchase agreement from the state so that the company could finance its proposed plant in Orange County. But the effort was not bearing fruit by October 2013, when it appeared that the state Public Service Commission was looking to restart old plants and was going to focus on new transmission rather than plants that generated power like the CPV plant.

Howe said he feared he and Percoco's wife were going to lose their jobs with CPV, telling Percoco in one email he was "sick to his stomach". In another he joked that Kelly was so nervous about the PSC move that Howe was going out to Home Depot to get plywood for a coffin for "Fat Man", their nickname for Kelly.

But the following June, there was hope when an independent agency recommended to the PSC that the CPV plant be built. That was at the same time that Percoco was pressing Howe for a consultancy because he was leaving the state payroll.

'Nice job Herb. Did you send in the ziti? Percoco asked in an email.

"Ziti in the oven," Howe responded.

The prosecution expects to wrap up its questioning of Howe Wednesday morning and he will then face what will likely be three or four days of cross examination.

Twitter: @jonbandler