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NYC company, owned by family who donated $300K to Gov. Hochul, paid $637 million for at-home COVID tests — without a contract

Jeenah Moon/Bloomberg via Getty Images

A company owned by a family which has donated $300,000 to the re-election campaign for New York Governor Kathy Hochul has been paid $637 million by the state over the past eight months to manufacture at-home COVID tests, and the entire arrangement has gone on without either party ever signing a contract.

According to the Times Union, Digital Gadgets LLC, owned by New York City businessman Charlie Tebele, has manufactured approximately 52 million at-home COVID tests since late November and sold them to the state of New York for either $13 or $11.50 each. Though the price per test appears to be reasonable, the state did not consider any other bids from competing manufacturers.

Nor did it seal the specifics of their agreement with a contract. The office of the state comptroller Tom DiNapoli issued almost 240 separate payments to Digital Gadgets between December 30 and March 25, but those transactions have been considered individual "purchase orders." DiNapoli's spokesperson denied that his office ever reviewed or approved them.

He didn't have to. When Hochul declared a state of emergency last November to combat the omicron variant surge, some New York finance laws were suspended, including laws regarding competitive bidding and comptroller oversight of state contracts, as a result.

But members of the state Republican Party aren't buying that explanation.

“I’m calling on Governor Hochul, and the department of health, to turn over all of their communications with the Tebele family and Digital Gadgets,” said state Republican Party Chair Nick Langworthy. “New Yorkers need to know who our government spoke to and when they spoke to them, and what was discussed.”

Langworthy claimed that he will soon file a Freedom of Information Act request to uncover more particulars about the transactions between the governor's office and Digital Gadgets and that he will ask a U.S. attorney to investigate the issue as well.

Despite the appearance of impropriety, however, Hochul has denied doing anything untoward. Hochul said that the state received test samples from several companies but that Digital Gadgets was the only manufacturer which could produce the number of tests needed by January 2022.

“The fact that there was someone who could meet that need at the time allowed us to deliver critically important test kits when nobody else, including the federal government, could get their hands on them,” Hochul said. “As a result we got kids back in school in January as opposed to them sitting home another semester.”

She also denied knowing that the Tebeles had donated so generously to her campaign.

“I was not aware that this was a company that had been supportive of me,” Hochul said. “I don’t keep track of that.”

The executive order for the state of emergency has been extended until August 13, but it may be extended again if Gov. Hochul deems it necessary.

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