Public finance officials and municipal bond analysts recalled Ed Koch as a passionate mayor who helped New York City emerge from the fiscal abyss.
Koch, a three-term mayor from 1977 to 1989 who took office just two years after the depths of the city’s financial crisis, died early Friday morning of congestive heart failure at New York Presbyterian Hospital. He was 88.
Richard Larkin remembers his Feb. 24, 1981 meeting with Koch as though it were yesterday. Larkin served on a 15-member Standard & Poor’s committee that was deciding whether to re-establish a credit rating for the city, and whether to make it investment grade.
“Ed Koch was very professional and very low-key until I asked about the long-term financial health of New York City. I questioned whether it was an affordable place to do business. Then he went ballistic. He said people were coming to New York City in droves. That was the real Ed Koch,” said Larkin, now senior vice president and director of credit analysis for HJ Sims & Co.
After that 1981 meeting, New York obtained its first investment-grade rating in nearly six years and could access the public markets without federal guarantees or support from a financing vehicle.
“As a rating analyst I wanted to see how he, as the chief executive of the city and the captain of the ship, would do against some pretty tough questioning. The professional side, the human side and the financial leadership was what made him authentic, genuine and real.
“That meeting was one of the highlights of my career. I loved the man, I really did,” said Larkin. “Ed Koch knew exactly what New Yorkers wanted. This was before political correctness. I don’t know how he would survive these days, but he was what New York needed at the time.”
Former Lt. Gov. Richard Ravitch, who first met Koch in the early 1970s when the latter was a congressman representing Greenwich Village, praised him as self-taught on financial matters.
“Ed had no business background and no knowledge of public finance, but he came to understand the problems of a city that had an $8 billion hangover of short-term debt that it had no way of repaying,” Ravitch said in an interview.
Ravitch, chairman of the Metropolitan Transportation Authority from 1979 to 1983, recalls Koch’s support during the early days of the MTA’s capital improvement program, even if the needed expenses meant raising fares. “He became a big supporter of our projects,” Ravitch said.
“Ed and I became very good friends for a lot of years,” said Ravitch, who last saw Koch about a month ago. “You could see he had aged significantly and had slowed down, but he hadn’t lost his sense of humor or his zest. We had a little argument about Israel. But you could see he was ill.”
John Hallacy, the head of municipal market research for Bank of America Merrill Lynch, remembered how Koch controlled the room during one heated meeting by telling everyone to “calm down” -- ironically so, given Koch’s irascible bent.
“It was the way he said it. Everyone stopped talking,” Hallacy said, laughing.
“He had the charisma,” added Hallacy. “His phrase ‘How am I doing?’ -- people loved that. In those days I was a young, green analyst who traveled a lot and everywhere I went, people said to me, ‘That mayor of yours, how’s he doing?’ And they said it with a smile.”
Hallacy, whose interest in New York’s dark days of the 1970s triggered his long career in public finance, said Koch helped shepherd a financial rebuilding that led to the city’s double-A ratings today.
“I tell the younger people around here to go back and watch the movie ‘The French Connection.’ It was a little dramatic but it also tells you everything about that period of the 1970s,” he said. “There are a lot of legacies about Ed Koch but his most enduring one was that he brought us back from the brink of disaster to a state of durable market access.”
Current Mayor Michael Bloomberg said the city “lost an irrepressible icon.” Gov. Andrew Cuomo called Koch “never one to shy away from taking a stand that he believed was right, no matter what the polls said or what was politically correct.”
Cuomo’s father, former Gov. Mario Cuomo, ran against Koch in the knock-down, drag-out mayor’s race in 1977 that unseated Koch’s predecessor, Abraham Beame. Speaking on an Albany radio show on Friday, the younger Cuomo compared that race -- Mario Cuomo was secretary of state at the time -- to the three famous Muhammad Ali-Joe Frazier fights of that decade.
City Comptroller John Liu called Koch “a true New Yorker, outspoken and feisty to the very end.”
Gene Russianoff, an attorney and chief spokesman for the Straphangers Campaign subway ridership lobbying group, praised Koch for doubling the city’s commitment to the MTA’s vital five-year rebuilding program in the mid-1980s, and pressuring the MTA to eliminate subway graffiti altogether by the end of that decade.
“Mayors have limited powers to affect subway and bus service, which is run by a state public authority. Mayor Koch used his to the fullest, employing his bully pulpit to drag public promises out of transit executives before the glare of cameras,” Russianoff said.
“Koch was an energy force,” added Mitchell Moss, the director of New York University's Rudin Center for Transportation. “The key part to Koch is that he invigorated New York when it was close to bankruptcy. He brought in some talented people and put them to work.”
Allen Cappelli, communications director to Fernando Ferrer when the latter was Bronx borough president, recalled Koch’s self-effacing side.
“He was always willing to admit he was wrong and essentially slap himself on the head, so to speak. He would disarm a situation that way, unlike a lot of politicians who would never admit they are wrong,” said Cappelli, a Staten Island lawyer who serves on the board of New York’s Metropolitan Transportation Authority, where Ferrer is now acting chairman.
“I didn’t agree with him on everything, but I respected his work ethic and his commitment to equity.”