Suffolk County Executive Steve Levy announced Thursday that he will not seek re-election in November, attributing his decision to questions regarding his $4 million campaign war chest, which has come under scrutiny from the Suffolk County District Attorney’s office.
“My decision was not made lightly,” Levy said in a statement. “There were concerns about staff I’d leave behind and the impact the decision would have on the Republican Party that so warmly welcomed me last year.
“There is a reason I didn’t announce a campaign manager or do a poll; I was truly undecided, but now the time has come to make this important decision,” he said.
“Questions have been raised concerning fundraising through my political campaign. Since this occurred under my watch I accept responsibility,” he continued. “In order to resolve these questions I will be turning over my campaign funds to the Suffolk County District Attorney.
“I thank the people of Suffolk County for the opportunity to have served them these many years.”
“I am satisfied that the actions taken by Mr. Levy resolve the investigation in the best interests of the citizens of Suffolk County,” Suffolk County District Attorney Thomas Spota said in a statement, adding that his office began investigating Levy’s campaign finances in the summer of 2009.
“The campaign money will be distributed to those individuals who request that it be returned,” Spota said. ”The remainder will be donated to charity. To avoid political gain by another person or political party I have determined that no distribution will be made until after the November 2011 election.”
Rich Schaffer, the Suffolk Democratic leader said he was “shocked” at the news, and he was still trying to digest it, when reached by the Long Island Press. “Clearly there is something significant there if he intends to forfeit $4 million.”
“This is the biggest political news in Suffolk County history,” Schaffer told the Press.
Ed Walsh, chairman of the Suffolk County Conservative Party, said the news also shocked him, and it throws the fall election up for grabs. He said he’d wait for someone to emerge from the Republican ranks before he’d commit his party. He praised Levy for being a staunch fiscal conservative, and lamented his leaving the race so soon.
Sources told the Press that they were not surprised by Levy’s move considering that his re-election chances were dimming in the wake of his controversial decision to sell the John J. Foley Skilled Nursing Facility in Yaphank to a private proprietor, another in a series of one-shot budget fixes to address a growing deficit.
This political development certainly puts the Democrats’ leading candidate—still unannounced (although that status could change within the next 24 hours)—Babylon Town Supervisor Steve Bellone in an advantageous position, who has already raised $1 million toward that effort.
Recently Levy’s name was bandied about by former Suffolk County Legis. George Guldi, who was convicted last month of mortgage insurance fraud and sentenced to eight to 12 years earlier this week. During his trial Guldi tried to link the county executive with Ethan Ellner, who was once a Levy crony and also did work for Guldi. Ellner, who became a leading witness against Guldi in the recently concluded case, is also under scrutiny by the district attorney for his role in an upcoming $82 million mortgage fraud case that involves Guldi.
Ellner has alleged that Levy, who was an usher at his wedding, solicited campaign contributions for county contracts. Levy has denied any wrongdoing.
Both Spota’s office and members of the Suffolk County Legislature have been examining these allegations closely.