Wednesday, June 03, 2009

Counterfactual: what if Daniel Goldstein had testified first at the Senate oversight hearing?

Counterfactual history considers what might have happened should key events proceeded differently. So, what might have happened at the state Senate oversight hearing Friday on Atlantic Yards if Daniel Goldstein, spokesman for Develop Don't Destroy Brooklyn, had testified first, before state officials got their turn?

Goldstein testified later and was given only a brief amount of time; he departed from his prepared remarks to respond to the crowd and the testimony of the government officials in the preceding panel.

But his prepared testimony would've essentially put the government officials on the defensive and prompted state legislators, who seemed underequipped to challenge those officials, with questions.

It would have been a very different hearing.

From the testimony

Goldstein began by laying out the landscape. Emphases are in the original.

He wrote:
Many argue that the Atlantic Yards project should be scrapped. But it already has been scrapped by Forest City Ratner. But the ESDC won’t take the next step and make it official. That is what they must do, so that we can sooner, rather than later see the healthy development of the Vanderbilt Rail Yards, with competitive bidding, truly affordable housing, open space the public can use, with a scope and scale that respects the surrounding community while still meeting a desirable and reasonable density.

Of course, the ESDC is not about to do that. Nor do we have solid numbers to justify the current version of this project versus an alternative.

Project a fantasy

Goldstein testified:
The project approved by the ESDC and PACB in December 2006—an arena and 16 skyscrapers with 6,430 housing units, including 2,250 units of so-called “affordable” housing, constructed over ten years—will never happen. The ESDC has admitted this Forest City Ratner has admitted this. Financing agreements between Ratner, the city and the state do not even set a timeline for the bulk of the proposed affordable housing, and allow six years to build the arena alone. And on April 9th the Chair of the ESDC said that the project “would take decades.” While she claims there is nothing wrong with that, she is incorrect—it violates her agency’s approval documents in the extreme, and reduces purported benefits to a trickle while blighting the Prospect Heights neighborhood over those same decades.

While the term "trickle" surely could be debated, Goldstein's testimony would have precluded legislators from letting Lago get away with nodding yes to Sen. Marty Golden's questions about whether the project and benefits remain the same. They don't. They can't.

Controlling the pace

Goldstein wrote:
Ratner claims that they “control the pace” of the project. This is wrong. If they were building on their own land with their own money, then they’d be accurate, but speculating on real estate gained by public subsidies, eminent domain, sweetheart land deals and undemocratic behavior is not acceptable and not in the public interest.

Indeed, it's a legitimate oversight question as to how and why a private developer can claim such control over what's been described as a public-private partnership.

Partnership of equals?

Goldstein testified:
The ESDC has willingly allowed itself to be the tool of Forest City Ratner. So much so, that when questioned by the public on many crucial Atlantic Yards issues, their answer is: Ask Forest City Ratner.

Indeed, I raised several questions about who's really in charge.

Catterson's opinion

Goldstein reminded the legislators:
It is most enlightening to quote from the concurring opinion written by New York State Appellate Judge James Catterson in a ruling IN FAVOR of the ESDC in a community legal challenge to the Atlantic Yards blight study, environmental review and approval. Judge Catterson wrote:
I believe that the New York Urban Development Corporation Act…is ultimately being used as a tool of the developer to displace and destroy neighborhoods that are "underutilized,"
Judge Catterson said it well: The ESDC doesn’t just cooperate, it allows itself to be abused, willingly allows itself to be “used as a tool.” It is the way they have done business with the Atlantic Yards project. And the results impact the public in the extreme.

What is even more disturbing is that Judge Catterson was writing in concurrence, which seems to mean that it is okay and expected for the UDC/ESDC to be used as a developer’s tool to destroy neighborhoods. It is not okay, and surely that is not what the UDC-Act envisioned.


That goes to the question of whether there should be reform of the ESDC.

A questionable sequence

Goldstein went on to point out elements of a questionable sequence, including:
  • no involvement by the community in project conception
  • a decision by state and city officials to bypass the city's Uniform Land Use Review Procedure (ULURP; which even Deputy Mayor Dan Doctoroff, in hindsight, regrets)
  • an eminent domain map drawn not by the government but by the developer
  • gag orders required of property sellers, which should have been disallowed because the city funded $100 million of Ratner's purchases (Goldstein submitted a copy of the gag order as an attachment)
  • a blight study that defined blight as cracked sidewalks and 'some buildings that weren’t built out past an arbitrary zoning density
Blight finding a "joke"

He testified:
I can’t be more blunt than this: the blight finding is a joke. Blight is supposed to be when a neighborhood is shot to hell and an impediment to the healthy economic growth of its surroundings. I live in the footprint. It wasn’t shot to hell, it wasn’t an impediment…but guess what, now it is shot to hell, or close to it, because the ESDC—in the supposed public interest—has allowed Ratner to demolish half the site, warehouse nearly all of the housing units and let the area become blighted as they had planned all along.

If the public interest were the issue, the city’s public agencies and officials would have rezoned the site to attract more development and density. It would be as simple as that. But the problem is: a rezoning would benefit the public and multiple developers, and would prohibit the land monopoly Ratner seeks and the massive profits the developer will see even if he never builds his project but gains the 22 acres of land.

Fishy sequence

Goldstein noted that, not long after Atlantic Yards was announced, the Metropolitan Transportation Authority even claimed that Forest City Ratner had the development rights to the Vanderbilt Yard. An RFP was issued 18 months after FCR was anointed the project.

Goldstein testified:
The very language of the RFP favored Forest City Ratner. All bidders were given 42 days to respond to a very complicated project that would be built over a rail yard. One developer, Extell Development Company, managed to submit a bona fide bid. Ratner offered the MTA $50 million, Extell offered $150 million, and the Yards were appraised at $214.5 million. Unsurprisingly the MTA decided to reject Extell and negotiate exclusively with Ratner over 45 days. After that time Ratner upped its bid to $100 million, which was still well below Extell and the appraisal, and the MTA agreed to the sweetheart price. MTA and Ratner claimed that there bid was worth more than just the $100 million in cash because they’d be building a new state-of-the-art rail yard.

Now, there's an interesting contradiction:
But the MTA was never seeking a new state-of-the-art rail yard, and Extell would have built one as well but they didn’t inflate the price in order to inflate the overall value of its bid

Now, press reports for months have been saying that Ratner, who hasn’t paid anything, yet for the yards, is negotiating a lesser payment, and/or payments in installments, and/or constructing a much less expensive rail yard.


Where, Goldstein asked, is the public interest?
Questions about the CBA

One of the fundamental pieces of context regarding Friday's hearing was that most, if not all, of those testifying and demonstrating in favor of the project came from groups that have gained (or stand to gain) from the project.

Goldstein pointed out that Community Benefits Agreements (CBAs) can be a good thing, but in this case there are many questions:
Each of these organizations have become private partners of the developer’s, by contract, most have received financial aid from the developer, and in so doing they have lost their independence and ability to adequately represent the public. The purported benefits outlined in the CBA should have been incorporated into the project’s governmental documents as a matter of public policy. Not left to the developer to cynically utilize for PR and to purchase project approval.

Circus, redux

Goldstein called the 8/23/06 public hearing to comment on the Draft Environmental Impact Statement (DEIS) a farcical circus, not a "fair hearing of the public’s comments on the disclosures and data found in the DEIS."

Ditto.

Little oversight

How did the ESDC board approve the project? Goldstein testified:
But on December 8, 2006 when only 4 of the 7 unelected, unaccountable ESDC board members even bothered to show up to give their rubberstamp vote of approval to Atlantic Yards, they took literally 15 minutes to make their decision. None of the questions asked were informed or substantive. One board member, when looking at the project site maps, actually had to ask the ESDC staffer making the presentation, what the name of a street was. It was Pacific Street. The street I live on, the one that would be removed by eminent domain and utilized to construct an outmoded superblock to make room for the Barclays Center Arena.

Naming rights

Goldstein raised a question that even I'd neglected beforehand:
If the project and the arena are in the public interest, and subsidized by the public, why does Forest City Ratner get ALL of the $400 million Barclays Bank agreed to pay to slap their logo all over the arena?

Cost/benefit analysis

Goldstein testified:
Neither the city nor the state has done a cost-benefit analysis of the entire project. And, meeting the needs of the private developer once again, the ESDC has not even bothered to inquire what kind of private benefit would accrue to Forest City Ratner.

Indeed, while city and state officials claimed benefits from the project, their conclusions were based on outmoded data, and did not include costs.

Potential reforms

Remember, it was an oversight hearing, aimed to shape potential legislation. Goldstein suggested some reforms (edited somewhat below), likely politically unpalatable but surely worthy of debate:
  • The ESDC is an unaccountable, out of control public agency. If it cannot be reformed and made accountable and transparent, it needs to be dismantled.
  • SEQRA (State Environmental Quality Review Act)
needs to be changed so that it is more than an exercise in papering over environmental disclosure and impacts. SEQRA should never be allowed to supplant ULURP in New York City as SEQRA is not a planning process.
  • Local legislatures must make local eminent domain decisions by votes, so elected officials will have to be directly accountable for their decisions.
  • The Eminent Domain Procedure Law (EDPL) needs to be reformed. At minimum condemnees must have the right to discovery and depositions when challenging an article 207 and must have the right to bring their challenge to Supreme Court rather than start in the Appellate Division.
  • Fndings for eminent domain must include an independent cost-benefit analysis of the proposed project as well as an independent analysis of the developer’s financial (and other) benefits.
  • “Blight” needs to be removed entirely as a justification for eminent domain. If that is too radical a step for the legislature, then “blight” must be precisely defined, rather than the open-door ambiguity it currently allows. Private developers cannot be allowed to handpick areas for study of “blight.”
  • If, under these stricter rules, a “blight” determination is made, the inhabitants of the “blighted” area should be given the opportunity to work with government to remedy the “blight” in their neighborhood, rather than kick them out and pave over their homes.

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