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Rochester airport fires up cigars to stoke business

December 20th, 2010 by Isabela Mayer

airport rochesterDavid Damelio, director of the Greater Rochester International Airport, enjoys a good cigar — and has charged thousands of dollars worth of them to the county-run airport in the name of business development.

Financial records for the Monroe County Airport Authority, the agency that oversees the airport, show that the authority footed the bill for $21,746 that Damelio spent on cigars, bars and restaurants catering to cigar smokers, and other tobacco-related products in Rochester and cities around the country since January 2008.

The charges included $16,733 on 120 visits to smoke shops that do not sell food or alcohol that could have run up the tab, and were among more than $120,000 spent on business meetings at local restaurants and bars, and travel for Damelio and other airport personnel, including air fare, meals, hotels, and private car services.

The authority, one of hundreds of quasi-governmental public benefit corporations across the state that have been the subject of numerous reform efforts aimed at increasing accountability, is not subsidized by taxpayers but acts as an arm of county government and its monies are considered public funds.

Underscoring the bond between the authority and Monroe County are that the county executive appoints seven people to the nine-member authority board, the county attorney and finance director serve as secretary and treasurer by statute, and the authority has no employees. All airport workers, including Damelio, are employed by the county. His salary is $102,000.

Damelio, a cigar hobbyist, and most authority board members defended the tobacco charges as justifiable, but administrators at the state agency that monitors public authorities expressed strong reservations about them.

“I think we would question expenses of that nature,” said David Kidera, director of the state Authority Budget Office. “One, there is the (amount) of it. Two, how does buying tobacco products advance the mission and purpose of the Airport Authority? You can argue that there are lots of ways of conducting business meetings that don’t involve buying cigars for yourself and others.”

Authority Chairman James Vazzana said the charges were part of the cost of raising the profile of the airport with airline and travel industry executives.

“I don’t have a problem with it and I don’t think the authority does,” Vazzana said. “If I had reason to believe that money was being spent for his own purposes, and I certainly don’t, then that would be a different situation.”

Where there’s smoke …

The financial records, which included credit card statements, receipts and travel expense logs obtained by the Democrat and Chronicle under an open records request, reveal Damelio frequented smoke shops several times a month and sometimes, while visiting other cities, multiple times in a single day. During one day in New York City in May, Damelio spent $164 at premier tobacconist Barclay-Rex, $110 at OK Cigars, a cigar shop and art gallery in SoHo, and $130 at Florio’s, a Little Italy restaurant and cigar lounge.

On a trip to San Antonio, Texas, in September 2009, records show Damelio dropped $124 at Club Humidor, a tobacconist, before noon and another $136 at the same place barely four hours later.

A month earlier, in August 2009, the airport paid $512 for meetings Damelio attended at three different New York City smoke shops over two days.

In an interview, Damelio acknowledged the charges may appear peculiar to some but said they were essential to airport business — an airport that is smoke-free.

The cigar parlor atmosphere appeals to his guests, Damelio said, adding that his knowledge of cigars enables him to be an effective host. He said he spends upward of $20 per cigar.

None of the receipts were itemized, making it impossible to identify what was purchased. But cigars in the $20 range include classes of Cohibas, Macanudos and La Gloria Cubanas.

“Am I in an environment that is comfortable for me? Absolutely. But I like to show them, ‘Hey, I know this,’ and I can give them a good quality cigar,” Damelio said.

“I want them comfortable, and I want to be the one who knows the most. I’m looking for any upper hand that I can get.”

The purchases are not limited to business trips.

Records show Damelio charged $6,681 on 50 visits to the Havana House, a Penfield tobacco shop with smoking lounge, over the last three years.

Most of the smoke shop stops were recorded in expense reports as the venue for meetings with airline representatives, travel agents for area companies and consultants. But many were not logged, some had no accompanying receipts, and those that were logged provided no specifics on the meeting subject or its attendees.

A typical expense entry, logged in July, listed a $106 charge at Dewey Avenue Smoke Shop in Rochester as “Airline Rep Meeting.”

Damelio explained that he avoids details in his expense logs to protect the privacy of his guests. Under the state’s Freedom of Information Law, the records could be obtained by airline industry insiders looking for an advantage over their competitors.

Asked whether the county would tolerate any other employee expensing tobacco and holding meetings at smoke shops, county spokesman Noah Lebowitz said the locale made little difference.

“If the venue is conducive to holding a productive meeting, and of course within reason is an appropriate venue for a professional conversation, then we would not take issue with the expenditure,” Lebowitz said.

Intensified scrutiny

Public scrutiny of airport directors nationwide has intensified in recent years, following media reports of lavish spending on trips to exotic destinations, pricey hotels and meals.

The former director of Kentucky’s Blue Grass Airport was convicted on criminal theft charges this summer after state auditors tallied $500,000 in questionable expenses incurred by him and other top airport officials, including Broadway tickets, shotguns, video game systems and cigars.

In Indianapolis, the airport director there was recently criticized for spending four of 15 months on the road, visiting cities in England and Malaysia on the airport’s dime.

Just last week it was reported that the director of Little Rock National Airport in Arkansas has reimbursed the airport $3,000 for expenses he had claimed were business related and has publicly apologized for authorizing a $40,000 payment to his son’s school for a football field advertisement promoting the airport’s website.

None of Damelio’s business expenses appear so extravagant or out of place — except for the tobacco.

Records show he takes about 15 business trips a year, mostly to New York City, Boston and Washington, and the bulk of his expenses are for hotels and meals.

But during a two-day junket to Boston and New York City in March 2009, Damelio charged the airport credit card $612 for six visits to four different cigar establishments. One was Cigar Masters in Boston, a lounge that sells beer, wine, cheese and crackers. The others were smoke shops.

He has on many occasions spent hundreds of dollars at pricey restaurants and has charged nearly $5,000 in private car services. Several of the transportation costs lacked receipts.

On the same March 2009 trip, the credit card statements showed charges of $977 at Morton’s of Chicago in Boston, $326 on chauffeurs in Boston, and $411 at a New York City steakhouse.

Records show the Airport Authority has paid for food for holiday and retirement parties — expenditures for which other authorities have been criticized by state auditors — but they were not incurred by Damelio.

The authority typically budgets $50,000 a year for travel and business-related expenses.

By contrast, Albany International Airport budgeted just $15,000 this year, according to a spokesman.

A Syracuse Hancock International Airport spokeswoman said travel expenses last year totaled $10,255, and that airport personnel take up to 15 trips per year, most of them day trips by car. However, the airport also employs a consulting firm that entertains and solicits business from airline and travel executives.

Three officials with Buffalo Niagara International Airport spent $25,090 on travel through the first six months of the current fiscal year, according to that airport. The airport also employs a consultant at up to $100,000 a year.

Board reaction

Authority board members mostly reacted to the tobacco expenditures with indifference. None acknowledged being aware of them, but they did not question their validity or the vagueness of the expense logs. Vazzana, the chairman, remarked that he was struck by how little was spent on cigars over the time period.

Bernard Iacovangelo, chairman of the audit committee, praised Damelio’s public relations skills and said the venue in which he entertains is irrelevant.

“When you’re marketing, you tend to want to take people to a venue that you’re comfortable with, and I don’t think the expenditures are unreasonable,” Iacovangelo said.

Stephen Tucciarello, a Republican Monroe County legislator and board member, said the cigar-related expenses are a small price to pay to network with industry executives.

“If these folks were golfers, they would all be going to a golf course,” Tucciarello said. “It sounds like they’re sitting down to drinks and cigars and if that’s what it takes to spend time with top executives, that’s what he has to do.”

Only one board member expressed doubt about the expenses.

Willie J. Lightfoot, a board member and Democratic Monroe County legislator, called them “absurd.”

“There is no reason to be spending that much in smoke shops. Is he smoking crack?” Lightfoot said.

“As a board member, it definitely raises concerns, and I think the public will feel the same way, too.”

Michael Farrar, deputy director of compliance and enforcement at the state Authority Budget Office, said auditors would likely find the expense logs to be insufficiently detailed and he questioned the public benefit of entertaining at smoke shops.

“If entertaining takes place, you have to ask, ‘What is the result?'” Farrar said. “If it is simply to entertain because that’s what’s done in the private sector and that’s how business is done, that is not a valid reason for a public benefit corporation.”

The authority expends tax dollars for capital projects and benefits from tax-free bonds, but its annual operating budget of about $32 million is derived from airline landing and rental fees, concessions, parking, rental cars and the like.

The results

The authority had employed a consultant at $100,000 a year to promote the airport and secure new routes until 2007. Board members pointed out that those duties have since fallen to Damelio, whose gregarious personality they said fits the public relations mold.

They credited his marketing efforts with keeping fares low, holding enplanements relatively steady, minimizing increases in airline rents and adding airline service in the midst of a recession.

The airport has not welcomed a new airline carrier during Damelio’s tenure, but AirTran last month began offering nonstop flights to Fort Myers, Fla. At the same time, JetBlue this month canceled its direct service to Orlando, citing a lack of interest.

Board members said Damelio’s relationship with American Airlines helped save service by the carrier’s American Eagle branch, which closed operations in Albany, and that his marketing efforts drew the annual New York Aviation Managers Association conference here in September.

That conference, they said, filled 500 hotel rooms, boosted local economic activity, and presented the authority with the opportunity to showcase Rochester and its airport to industry insiders over three days.

Some conference attendees played a round of golf at Brook-Lea Country Club in Gates. Participants in the outing received gift bags courtesy of the authority that included, among other things, cigars bought online for $700.

Rochester airport fires up cigars to stoke business

David Andreatta • Staff writer • December 19, 2010

David Damelio, director of the Greater Rochester International Airport, enjoys a good cigar — and has charged thousands of dollars worth of them to the county-run airport in the name of business development.

Financial records for the Monroe County Airport Authority, the agency that oversees the airport, show that the authority footed the bill for $21,746 that Damelio spent on cigars, bars and restaurants catering to cigar smokers, and other tobacco-related products in Rochester and cities around the country since January 2008.

The charges included $16,733 on 120 visits to smoke shops that do not sell food or alcohol that could have run up the tab, and were among more than $120,000 spent on business meetings at local restaurants and bars, and travel for Damelio and other airport personnel, including air fare, meals, hotels, and private car services.

The authority, one of hundreds of quasi-governmental public benefit corporations across the state that have been the subject of numerous reform efforts aimed at increasing accountability, is not subsidized by taxpayers but acts as an arm of county government and its monies are considered public funds.

Underscoring the bond between the authority and Monroe County are that the county executive appoints seven people to the nine-member authority board, the county attorney and finance director serve as secretary and treasurer by statute, and the authority has no employees. All airport workers, including Damelio, are employed by the county. His salary is $102,000.

Damelio, a cigar hobbyist, and most authority board members defended the tobacco charges as justifiable, but administrators at the state agency that monitors public authorities expressed strong reservations about them.

“I think we would question expenses of that nature,” said David Kidera, director of the state Authority Budget Office. “One, there is the (amount) of it. Two, how does buying tobacco products advance the mission and purpose of the Airport Authority? You can argue that there are lots of ways of conducting business meetings that don’t involve buying cigars for yourself and others.”

(2 of 6)
Authority Chairman James Vazzana said the charges were part of the cost of raising the profile of the airport with airline and travel industry executives.

“I don’t have a problem with it and I don’t think the authority does,” Vazzana said. “If I had reason to believe that money was being spent for his own purposes, and I certainly don’t, then that would be a different situation.”

Where there’s smoke …

The financial records, which included credit card statements, receipts and travel expense logs obtained by the Democrat and Chronicle under an open records request, reveal Damelio frequented smoke shops several times a month and sometimes, while visiting other cities, multiple times in a single day. During one day in New York City in May, Damelio spent $164 at premier tobacconist Barclay-Rex, $110 at OK Cigars, a cigar shop and art gallery in SoHo, and $130 at Florio’s, a Little Italy restaurant and cigar lounge.

On a trip to San Antonio, Texas, in September 2009, records show Damelio dropped $124 at Club Humidor, a tobacconist, before noon and another $136 at the same place barely four hours later.

A month earlier, in August 2009, the airport paid $512 for meetings Damelio attended at three different New York City smoke shops over two days.

In an interview, Damelio acknowledged the charges may appear peculiar to some but said they were essential to airport business — an airport that is smoke-free.

The cigar parlor atmosphere appeals to his guests, Damelio said, adding that his knowledge of cigars enables him to be an effective host. He said he spends upward of $20 per cigar.

None of the receipts were itemized, making it impossible to identify what was purchased. But cigars in the $20 range include classes of Cohibas, Macanudos and La Gloria Cubanas.

“Am I in an environment that is comfortable for me? Absolutely. But I like to show them, ‘Hey, I know this,’ and I can give them a good quality cigar,” Damelio said.

“I want them comfortable, and I want to be the one who knows the most. I’m looking for any upper hand that I can get.”

(3 of 6)
The purchases are not limited to business trips.

Records show Damelio charged $6,681 on 50 visits to the Havana House, a Penfield tobacco shop with smoking lounge, over the last three years.

Most of the smoke shop stops were recorded in expense reports as the venue for meetings with airline representatives, travel agents for area companies and consultants. But many were not logged, some had no accompanying receipts, and those that were logged provided no specifics on the meeting subject or its attendees.

A typical expense entry, logged in July, listed a $106 charge at Dewey Avenue Smoke Shop in Rochester as “Airline Rep Meeting.”

Damelio explained that he avoids details in his expense logs to protect the privacy of his guests. Under the state’s Freedom of Information Law, the records could be obtained by airline industry insiders looking for an advantage over their competitors.

Asked whether the county would tolerate any other employee expensing tobacco and holding meetings at smoke shops, county spokesman Noah Lebowitz said the locale made little difference.

“If the venue is conducive to holding a productive meeting, and of course within reason is an appropriate venue for a professional conversation, then we would not take issue with the expenditure,” Lebowitz said.

Intensified scrutiny

Public scrutiny of airport directors nationwide has intensified in recent years, following media reports of lavish spending on trips to exotic destinations, pricey hotels and meals.

The former director of Kentucky’s Blue Grass Airport was convicted on criminal theft charges this summer after state auditors tallied $500,000 in questionable expenses incurred by him and other top airport officials, including Broadway tickets, shotguns, video game systems and cigars.

In Indianapolis, the airport director there was recently criticized for spending four of 15 months on the road, visiting cities in England and Malaysia on the airport’s dime.

Just last week it was reported that the director of Little Rock National Airport in Arkansas has reimbursed the airport $3,000 for expenses he had claimed were business related and has publicly apologized for authorizing a $40,000 payment to his son’s school for a football field advertisement promoting the airport’s website.

(4 of 6)
None of Damelio’s business expenses appear so extravagant or out of place — except for the tobacco.

Records show he takes about 15 business trips a year, mostly to New York City, Boston and Washington, and the bulk of his expenses are for hotels and meals.

But during a two-day junket to Boston and New York City in March 2009, Damelio charged the airport credit card $612 for six visits to four different cigar establishments. One was Cigar Masters in Boston, a lounge that sells beer, wine, cheese and crackers. The others were smoke shops.

He has on many occasions spent hundreds of dollars at pricey restaurants and has charged nearly $5,000 in private car services. Several of the transportation costs lacked receipts.

On the same March 2009 trip, the credit card statements showed charges of $977 at Morton’s of Chicago in Boston, $326 on chauffeurs in Boston, and $411 at a New York City steakhouse.

Records show the Airport Authority has paid for food for holiday and retirement parties — expenditures for which other authorities have been criticized by state auditors — but they were not incurred by Damelio.

The authority typically budgets $50,000 a year for travel and business-related expenses.

By contrast, Albany International Airport budgeted just $15,000 this year, according to a spokesman.

A Syracuse Hancock International Airport spokeswoman said travel expenses last year totaled $10,255, and that airport personnel take up to 15 trips per year, most of them day trips by car. However, the airport also employs a consulting firm that entertains and solicits business from airline and travel executives.

Three officials with Buffalo Niagara International Airport spent $25,090 on travel through the first six months of the current fiscal year, according to that airport. The airport also employs a consultant at up to $100,000 a year.

Board reaction

Authority board members mostly reacted to the tobacco expenditures with indifference. None acknowledged being aware of them, but they did not question their validity or the vagueness of the expense logs. Vazzana, the chairman, remarked that he was struck by how little was spent on cigars over the time period.

(5 of 6)
Bernard Iacovangelo, chairman of the audit committee, praised Damelio’s public relations skills and said the venue in which he entertains is irrelevant.

“When you’re marketing, you tend to want to take people to a venue that you’re comfortable with, and I don’t think the expenditures are unreasonable,” Iacovangelo said.

Stephen Tucciarello, a Republican Monroe County legislator and board member, said the cigar-related expenses are a small price to pay to network with industry executives.

“If these folks were golfers, they would all be going to a golf course,” Tucciarello said. “It sounds like they’re sitting down to drinks and cigars and if that’s what it takes to spend time with top executives, that’s what he has to do.”

Only one board member expressed doubt about the expenses.

Willie J. Lightfoot, a board member and Democratic Monroe County legislator, called them “absurd.”

“There is no reason to be spending that much in smoke shops. Is he smoking crack?” Lightfoot said.

“As a board member, it definitely raises concerns, and I think the public will feel the same way, too.”

Michael Farrar, deputy director of compliance and enforcement at the state Authority Budget Office, said auditors would likely find the expense logs to be insufficiently detailed and he questioned the public benefit of entertaining at smoke shops.

“If entertaining takes place, you have to ask, ‘What is the result?'” Farrar said. “If it is simply to entertain because that’s what’s done in the private sector and that’s how business is done, that is not a valid reason for a public benefit corporation.”

The authority expends tax dollars for capital projects and benefits from tax-free bonds, but its annual operating budget of about $32 million is derived from airline landing and rental fees, concessions, parking, rental cars and the like.

The results

The authority had employed a consultant at $100,000 a year to promote the airport and secure new routes until 2007. Board members pointed out that those duties have since fallen to Damelio, whose gregarious personality they said fits the public relations mold.

(6 of 6)
They credited his marketing efforts with keeping fares low, holding enplanements relatively steady, minimizing increases in airline rents and adding airline service in the midst of a recession.

The airport has not welcomed a new airline carrier during Damelio’s tenure, but AirTran last month began offering nonstop flights to Fort Myers, Fla. At the same time, JetBlue this month canceled its direct service to Orlando, citing a lack of interest.

Board members said Damelio’s relationship with American Airlines helped save service by the carrier’s American Eagle branch, which closed operations in Albany, and that his marketing efforts drew the annual New York Aviation Managers Association conference here in September.

That conference, they said, filled 500 hotel rooms, boosted local economic activity, and presented the authority with the opportunity to showcase Rochester and its airport to industry insiders over three days.

Some conference attendees played a round of golf at Brook-Lea Country Club in Gates. Participants in the outing received gift bags courtesy of the authority that included, among other things, cigars bought online for $700.

DANDREAT@DemocratandChronicle.com

DemocratandChronicle.com, your source for Rochester, N.Y. news.

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