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Appeal filed in case challenging AY environmental review; hearing will be in September

The last (for now, at least) major legal obstacle to the Atlantic Yards project moved forward one major step Monday as Develop Don’t Destroy Brooklyn (DDDB) and 25 co-plaintiff organizations appealed state Supreme Court Justice Joan Madden's January 11 dismissal of a challenge to the project’s environmental review.

(A new eminent domain case is expected to be filed in state court after being dismissed in federal court, where it was aimed because plaintiffs felt that venue offered a better shot. Another case in state court challenges the project timetable.)

While courts typically give much discretion to evaluating agencies, it will be interesting to see whether (and how) the state appeals court agrees that it’s OK to designate a building built at less than 60% of allowable development rights as blighted, or that it was legitimate to consider a professed ten-year project buildout as legitimate in the face of a mountain of evidence--including the construction schedule attached to the Final Environmental Impact Statement (FEIS)--to the contrary.

(The insta-snarks at New York magazine’s web site said the appeal was the work of “Atlantic Yards haters.” It might be equally said that the appeal was the work of "haters-of-government-fudging.")

The appeal brief contends that the FEIS submitted by former Gov. George Pataki's Empire State Development Corporation (ESDC) was fatally flawed; success in this case would not necessarily block the project but would require a new EIS and a new vote by the Public Authorities Control Board (PACB).

Along with the ESDC and PACB, defendants in the case include the Metropolitan Transportation Authority and developer Forest City Ratner (FCR). A response from the defendants is expected in August and oral argument will be held in September; the defendants had requested that oral argument be held in the spring.

Grounds for opposition

The plaintiffs believe that the case, DDDB et al. v ESDC et al., was wrongly decided on several grounds. As stated in the DDDB press release, they include:
• The State's determination that the project site is "blighted" was illegitimate, and manufactured by the developer to take valuable private property via eminent domain.
• The State had no authority to approve the Barclays Center Arena because it is not a "Civic Project" as defined under the Urban Development Corporation Act (UDCA).
• The State violated the State Environmental Quality Review Act (SEQRA) by failing to consider the possibility of terrorism and other security breaches on the Project.
• The State violated SEQRA by grossly misrepresenting the project's construction timeline, thereby minimizing the project's impacts, and not requiring adequate mitigation.
• The State violated SEQRA when it failed to adequately study alternative locations for the proposed Project, including locating the arena in Coney Island.
• The PACB violated SEQRA by approving the project without considering its environmental impacts and failing to make its own SEQRA findings.

Looking at blight

The appeal notes that, of the eight city blocks that comprise the Project’s planned footprint, five are within the Atlantic Terminal Urban Renewal Area (ATURA), created by New York City in 1968 to further redevelopment of what was determined to be a blighted area.

However, “three privately owned, contiguous blocks,” along the south side of Pacific Street and the north side of Dean Street, “are part of a rapidly redeveloping area of Prospect Heights characterized by private conversions of former warehouse and factory buildings into residential apartments, and rapidly increasing property values.”

While non-blighted parcels may be added to a blighted area for eminent domain, ESDC had no rational basis to argue that residential redevelopment of the non-ATURA Blocks was unlikely--indeed, that was contradicted by recent residential conversions within the project footprint and next to it, a phenomenon noted in an 8/30/02 New York Times article in the New York Times.

The appeal argues that the court was wrong in dismissing the evidence of market conditions as “insufficient to outweigh the ample evidence of blight conditions documented in the Blight Study.” Indeed, the court ignored the absence of any market study by ESDC.

Moreover, the announcement of the project in December 2003 stalled any further redevelopment in the footprint.

While hundreds of pages of written criticisms of the Blight Study were ignored, the appeal brief states that the ESDC dismissed those comments by asserting that the Blight Study was attached to the General Project Plan and, therefore, was “not a part of the EIS.”

While that was the ESDC’s legal response, unmentioned in the brief is that, in the Response to Comments section of the EIS (p. 24-545 of Part 2), the ESDC did in fact respond briefly to some comments on blight.

Underbuilt = blight?

Can the ESDC say that a building under 60% of allowable development rights is blighted? The brief states:
While factors such as vacancy rates and underutilization may be among other factors considered in determining blight, we are aware of no reported New York case law in which a court has affirmed a blight determination based primarily on a claim that properties were not built to the maximum permissible FAR [Floor Area Ratio].

By ESDC's implication, any building that is 60% or less of the allowed density is by definition underutilized and thus a blighted structure or a blighting influence. That is absurd. This arbitrary classification, without reference to the actual use of the building and its overall utility, would if applied throughout the borough, render most of Brooklyn blighted. The New York City Zoning Resolution does not require that all lots be built out to their maximum density.

Justice Madden dismissed a recent decision by the New Jersey Supreme Court, in a case known as Gallenthin Realty Development, Inc. v Borough of Paulsboro, which said that underutilization was insufficient to determine blight.

While Madden said the case was irrelevant, the brief argues that the court “was applying what it recognized as nearly universal definitions of blight that had the common desire to remove slum-like and deteriorating conditions.”

Indeed, the cases the court relied on regarded “blight determinations were made by legislative bodies in the context of urban renewal plans” rather than “a quasi-executive agency at the behest of a private developer and based solely on a blight study paid for by that same developer as a post hoc justification 31 months after unveiling the project.”

PACB’s failure

While SEQRA generally requires any agency with discretionary authority over an action already subject to an EIS to make its own environmental findings, it exempts those actions deemed ministerial and non-discretionary, the brief states, saying the Court was viewing the case too narrowly:
In fact, PACB generally considers a broad range of non-financial factors in its decision-making function and its decisions are highly discretionary.

As an example of the PACB’s broad discretion, the brief cites Assembly Speaker Sheldon Silver, who on 6/5/05, explained his rejection of the West Side Stadium by saying that the city and state had other obligations: to basic education, to revitalize Lower Manhattan, and to support the transit system.

The terrorism issue

The brief acknowledges that “[i]t does not appear that any court has addressed the terrorism issue in circumstances analogous to this case,” but suggests that case law points to such a look.

Moreover, “terrorism is not an isolated environmental issue, but directly affects other environmental impacts that must be addressed under SEQRA,” such as the effect on “the character of the glass-enclosed Barclays Center Arena and adjacent Urban Room,” both of which are promoted as public benefits. And, given that streets next to the recently opened Prudential Center in Newark have been closed, the ESDC didn’t consider how security protocols--even though the city and state claim it won't close streets--might affect local traffic.

The appeal notes that the environmental reviews for other projects do address security. The Generic Environmental Impact Statement (GEIS) for the World Trade Center Memorial and Redevelopment Plan, contains five pages of security analysis.

The environmental review for the MTA Long Island Rail Road East Side Access 50th Street Facility Revised Environmental Assessment contains 12 pages of analysis and comments largly about terrorism, according to the brief. The Fulton Street Transit Center Final Environmental Impact Statement includes a six-page Safety and Security section.

The appeal states:
While none of those EISs discloses confidential security information, they all discuss the designing and planning for terrorist attacks and the mitigation measures, and provide a basic platform for public comment and input. In contrast, discussion of security issues in the FEIS at issue herein is limited mainly to a single paragraph captioned “Public Safety” and a few broad references to a future “site security plan,” security screenings, and coordination with the local police and fire departments to be developed.

Poor timing

The project was approved with a ten-year anticipated time frame and an environmental analysis based on a decade. A substantially longer construction period, the brief states, increases the disruption caused by construction-related traffic, noise, and dust and would delay the completion of Phase 2, “resulting in a substantial portion of an entire Brooklyn neighborhood being utilized as a long term construction staging area and an oversized parking lot for 1600 cars and trucks belonging to FCR‟s construction workers.” Also, it would delay claimed public benefits, such as the expected open space.

The brief points not only to Forest City Enterprises CEO Chuck Ratner’s prediction of a 15-year buildout--quickly disavowed--and project landscape architect Laurie Olin’s prediction of 20 years.

(After the briefs were filed in the previous proceeding, the ESDC signed a funding agreement allowing 12 years to build Phase 1, “further evidencing ESDC‟s knowledge that the build years designated in the FEIS were completely inaccurate,” the appeal states.)

The brief adds:
Moreover, the lower court erred in giving no weight to the statements of Messrs. Ratner and Olin. This was not the wild conjecture of the appellants, but public statements of an FCRC principal and its principal landscape architect made directly on this point.

Moreover, as has been pointed out on this blog, the brief adds that the construction schedule was already inaccurate when the FEIS was issued, because the construction timeline expected demolition to begin on 11/1/06, even before the project was passed.

The brief adds:
Moreover, ESDC knew that it had to acquire various properties for Phase I through eminent domain, a process that would involve significant litigation that would keep the project from commencing. ESDC's contention that it had a right to rely on a construction schedule that they already knew was inaccurate is spurious.

The brief notes that the ESDC at first “cavalierly claimed” its methodology was consistent with the CEQR Manual, then argued that Project completion date wasn't crucial, based on one case--which the plaintiffs say isn’t on point.

Civic project?

The brief notes:
The UDCA defines a “civic project” as [a] project or that portion of a multi-purpose project designed and intended for the purpose of providing facilities for educational, cultural, recreational, community, municipal, public service or other civic purposes.
The Court below determined that the Barclays Center Arena qualifies as a “civic project” under the UDCA because it is a facility designed and intended for “recreational” purposes.

But the definition of “recreational facility” does not turn on whether the recreation is active or passive, or whether the public is watching or playing, the brief states; rather, the cases relied on by the lower court concern facilities “owned and operated by public authorities.”

The brief states:
But the statute expressly limits who may own or lease a “civic project.” Under no stretch of the imagination can FCRC or a professional basketball franchise be considered an “entity which is carrying out a community, municipal, public service or other civic purpose” – unless one engages in circular reasoning... Appellants have found no decision in which a New York court has ever determined that a professional sports arena is a civic project under the UDCA.

While the earlier decision relied on a case allowing Erie County to lease a county stadium to a private entity, the stadium’s purposes, the brief states, were declared by the legislature--while no such determination has been made regarding the Brooklyn arena.


  1. The papers that were filed are really good and there is a lot more to be considered and talked about that is in them. Overall, the facts are on DDDB’s side, the law is on DDDB’s side, the urban planning is on DDDB’s side and any rational version of politics ought rightfully to play out on their side.

    One quick observation that relates to something in yesterday’s AYR post.

    One of the things the appeal papers deal with is that ESDC does not have general statutory powers to finance a private sports arena like the one which would be given to Ratner for the Nets. In the few situations where ESDC was ever able to finance a sport complex it was necessary for the legislature to confer augmenting authority upon ESDC for that purpose by special enactments. The authority that the legislature chose to confer in those limited instances was particular and applicable only to the specific facilities identified at the time.

    The legislature left ESDC’s general authority circumscribed as follows.

    ESDC only has the power to do projects consisting of facilities for “civic purposes.” There are no surprises, the examples the statute identifies of what constitutes a purpose which is “civic” are clearly limited to that which is traditionally understood to be the kind of “civic” things government engages in providing; that which is “educational, cultural, recreational, community, municipal, public service.”

    The statute is strict: If the facility is not exclusively devoted to such civic purposes ESDC only has the power to engage in providing the limited “PORTION” of a multi-purpose project which is “designed and intended for the” (civic) “purpose.” So, for instance, it would not be sufficient that a facility designed for another non-civic purpose is sometimes used instead for a civic purpose. In other words, using an empty basketball arena to hold community board meetings would not convert it to a civic facility, not even if Brooklyn Borough President Marty Markowitz was allowed to make simultaneous use of one of the $540,000 luxury sky-box suites to try to figure out which community board members he should fire next for having the sense to oppose a project like Atlantic Yards.

    The statute is stricter. It imposes another requirement about how the facility must be owned and controlled by a government entity which is thereby “carrying out a community, municipal, public service or other civic purpose." In other words, relinquishing control of the facility to a private entity to carry out a private purpose is not possible under ESDC’s statute.

    That brings me back to yesterday’s AYR post.

    As Bloomberg was quoted saying about the Nets and the Jets in Norman's post of yesterday:
    "THEY'RE PRIVATELY OWNED. . . . . The Nets have not done well in New Jersey; their parking lot's half full. Y'know, they've not sold out in a long time. The Jets don't like sharing a stadium. BUT THESE ARE PRIVATE VENTURES.”

    Clearly there is a lot that Bloomberg doesn’t get about the public subsidization of monopoly sports franchises through tax loopholes, but his characterization of them as private money making ventures, not “civic,” is telling and exactly what a large part of this is about both: a.) on the level of state law being dealt with in the appeal, and also b.) with respect to the federal tax loophole which is under discussion.


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