WASHINGTON – The owners of Destiny USA are stepping up their battle against a plan to reroute Interstate 81 in Syracuse by spending hundreds of thousands of dollars on lobbyists to influence the federal government before it begins reviewing the project.

The Syracuse mall owners hired a high-powered Washington lobbying firm whose co-founder helped develop President Donald Trump’s transportation policies as a member of his transition team in 2016, public records show.

Martin Whitmer of the firm Whitmer & Worrall plans to lobby the Federal Highway Administration on “issues related to transportation in Onondaga County, New York,” according to a federal lobbying disclosure report filed Wednesday with Congress.

Whitmer, one of Washington’s top transportation lobbyists, was deputy chief of staff at the U.S. Department of Transportation in President George W. Bush’s administration and served as a senior adviser on issues that included interstate highways.

Whitmer’s hiring provides the first public indication that Destiny USA and mall developer The Pyramid Cos. plan to continue a behind-the-scenes battle in Washington after losing a multi-year effort to sway New York government on the future of Interstate 81.

The mall owners, who spent $170,000 lobbying the federal government about I-81 since 2017, face an uphill battle in Washington with their latest effort. The federal government doesn’t normally overrule states on interstate highway projects. Regulators determine if states followed rules for building a highway, not whether a project has merit.

In April, the state recommended tearing down the elevated stretch of I-81 in downtown Syracuse and replacing it with a street-level boulevard known as the “community grid.” Highway traffic would be re-routed around the city – away from Destiny USA – on Interstate 481.

Destiny USA’s owners have pushed for a tunnel or hybrid tunnel-boulevard option to keep highway traffic flowing by the mall.

The state is holding a series of public information sessions on its proposal before completing a draft environmental impact statement. That document must eventually be approved by the Federal Highway Administration, which oversees interstate highway projects and pays up to 80 percent of the costs.

Destiny USA spent at least $170,000 over the past two years lobbying the agency as well as members of Congress through a separate Washington firm, Envision Strategy, according to federal disclosure reports.

A spokesman for The Pyramid Cos., the largest privately-owned shopping mall developer in the Northeast, said the company would have no comment about its federal lobbying efforts.

Steve Stallmer, who lobbied on the I-81 issue for Envision Strategy, referred comment to Destiny USA and Pyramid.

Stallmer, an Upstate New York native who served as chief of staff to former Rep. Chris Gibson, R-Kinderhook, was among at least two members of his firm who reported lobbying Upstate New York members of Congress about I-81.

Reps. John Katko, R-Camillus, and Anthony Brindisi, D-Utica, confirmed they met with Pyramid or Destiny officials prior to the state’s decision in April.

Brindisi met with Pyramid officials twice to hear their concerns. He sent a letter to the state Department of Transportation on March 26, saying he stood united on the issue with five of his House colleagues from Upstate New York who sent an earlier letter to the state.

That letter, dated Jan. 11, urged state officials not to allow the cost to dictate which alternative the DOT recommends for the future of I-81. The state found the tunnel option would be the most expensive, at an estimated $4.9 billion over 11 years of construction.

“For the economic prosperity of New York state, and for the residents and businesses of Central New York, the design selected to bring Interstate 81 into the 21st Century should be based on long-term value, not simply cost alone,” the House members wrote.

The letter was signed by Katko and Reps. Elise Stefanik, R-Schuylerville; Chris Collins, R-Clarence; Tom Reed, R-Corning; and Sean Patrick Maloney, D-Cold Spring.

The same House members sent a letter to Gov. Andrew Cuomo on June 26, 2017, except for Brindisi, who was elected in November 2018. That letter also emphasized that cost should not be the driving force behind the state’s decision.

All six House members represent congressional districts with shopping malls owned or operated by Destiny USA’s developer, the Syracuse-based Pyramid Companies, or that neighbor the company’s malls.

The Upstate House members sent the first letter only three months after Destiny USA re-started its Washington lobbying efforts in 2017 to focus on Interstate 81, records show.

As part of that effort, Destiny shared documents with members of Congress that were favorable to the tunnel option.

One document reviewed by Syracuse.com | The Post-Standard included an analysis by Maser Consulting that predicted gridlock with the community grid. The analysis said at one intersection “drivers could expect to wait through as many as three traffic signals to clear the intersection.”

Destiny and its lobbyists also shared some non-scientific surveys and letters to the editor that were either against the community grid or supportive of the tunnel option.

Whitmer, the former federal transportation official who is Destiny’s latest hired gun, did not respond to requests for an interview.

He leads his firm’s “transportation and infrastructure practice,” whose clients include the Association of American Railroads and the National Asphalt Pavement Association.

Whitmer & Worrall’s fees typically range from $10,000 to $70,000 per quarter, lobbying records show.

The firm, which lobbied for Destiny USA for only a portion of a quarter, checked a box for “less than $5,000” in fees on its first disclosure report. Destiny’s other lobbying firm, Envision Strategy, has charged $20,000 per quarter.

Whitmer brings with him a wealth of connections to influential figures in Washington’s transportation sector. He serves on a foundation with three former U.S. Department of Transportation secretaries.

The DOT oversees the Federal Highway Administration, which will likely review New York’s draft proposal starting this fall.

In the interim, at least one member of Congress has made the agency aware of his concerns.

Katko said in an interview that he met with FHWA officials about a month ago to find out what role the agency will play in the final decision.

He said the state’s preferred option – diverting interstate highway traffic away from Syracuse to I-481 – is far from the last word on the subject.

“It’s absolutely not a done deal,” Katko said. “All we’re at right now is that the Cuomo administration has stated its preference.”

In practice, FHWA doesn’t choose one alternative over another when reviewing plans for interstate highway projects, according to the agency and a former federal DOT official.

States own, operate and maintain the interstates. The FHWA provides most of the money for construction and makes sure states follow federal regulations as they move forward with a project.

Beth Osborne, a former top administrator at the DOT under former president Barack Obama, said federal highway officials can hold up a project only if a state didn’t follow proper procedures and regulations, such as considering environmental impacts.

Osborne said it’s not unusual for lobbyists to meet with federal transportation officials, but she said it’s often a waste of time and money for those who hire them.

“As long as a project is eligible and they’re following the rules, states can build any kind of highway they want no matter how stupid or smart it is,” Osborne said.

The owners of Destiny USA have a long history of spending money in Washington on lobbyists who try to influence members of Congress.

Over the years, Destiny’s owners have also donated generously to the campaigns of members of Congress from both political parties, Federal Election Commission Records show.

One executive, Bruce Kenan, of Skaneateles, has contributed at least $174,700 to candidates for federal office or political committees dating to 1997, FEC records show.

This year, Kenan donated $10,000 on April 8 to the National Republican Congressional Committee in Washington, which supports GOP candidates running for House seats.

Stephen J. Congel, CEO of Pyramid Management Group, donated $5,000 to the NRCC on March 27.

In February and March, Kenan donated a combined $5,600 to Katko’s campaign committee, the maximum allowed under federal campaign finance laws for an election.

Cars enter Destiny USA from the Interstate 81 south off-ramp, right, as seen from Hiawatha Boulevard in Syracuse. File photo | David Lassman

Katko, R-Camillus, has not endorsed the state’s recommendation, nor taken a public position on any of the alternatives considered for I-81.

The campaign donations to members of Congress and political parties are separate from Destiny’s lobbying efforts.

All told, Destiny’s owners spent more than $6.5 million lobbying Congress and the federal government between 2001 and 2013, according to records compiled by the Center for Responsive Politics, a Washington watchdog group.

The spending coincided with Destiny’s successful fight for legislation authorizing $228 million in federally tax-exempt “green bonds” to finance the expansion of Carousel Center mall into Destiny USA.

A former IRS official would later tell Syracuse.com | The Post-Standard that the agency ignored tax law violations related to the bonds.

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