Tuesday, June 30, 2009

The Partnership for New York City's evolving (and misleading) support for Atlantic Yards

The Partnership for New York City (PFNYC), which exemplifies the business community, is sure straining in its support for Atlantic Yards, dropping previous enthusiasm about Frank Gehry and affordable housing to focus on the goal of building an arena, while misleadingly suggesting that the project as it stands would generate many permanent jobs.

The PFNYC is essentially the city's Chamber of Commerce, a nonprofit membership organization with some 200 CEOs (“Partners”) from New York City’s "top corporate, investment and entrepreneurial firms."

Given that Forest City Ratner, Nets Sports & Entertainment, and Barclays Capital are among the partners, it's hardly surprising that the PFNYC supports Atlantic Yards, but testimony from PFNYC President Kathryn Wylde opening the June 22 Metropolitan Transportation Authority (MTA) Finance Committee meeting was notably thin, clocking in at half the allotted two minutes.

The testimony



Wylde said:
I'm Kathryn Wylde, president of the Partnership for New York City, and I'm pleased to be here today to testify today in support of Atlantic Yards. It's a project that we have supported for a number of years. We consider this to be an important step, particularly now, in a faltering economy and with the credit crisis, the fact that we have some key projects that can move forward, particularly across the five boroughs at this point in time, is more important than ever.

We understand and have reviewed some of the re-designs in the project. The changes in terms which I think are reflective of the realities of today's economy but keep this quality project and will bring the Nets to Brooklyn. We see something that can help further diversy our city's economy and create a new source of revenues and jobs that goes well beyond Wall Street. We think it's an important project and we hope you're able to support it.

The critique

Wylde chose to disregard Independent Budget Office testimony at the May 29 state Senate oversight hearing that the arena would be a money-loser for the city. And, while implying that Atlantic Yards would be part of a new business district or at least bolster a significant sector of the economy, her testimony disregarded the fact that no office space is currently planned.

The rebuttal Monday came from Noticing New York's Michael D.D. White.


White said:
You notice the economy has changed. In a situation like this, this is the time we look to get better deals from the developers and contractors that we deal with. It's something that Forest City Ratner is reportedly doing with its own contractors. We hope you are aware that other state and local governments are finding ways to get more for their money when dealing with developers in this economy. And yet, we are proposing a bailout for a financially weak developer, a deal that is in every way worse for the public and in every way better for the developer.

A project of less value under the rubric of value engineering. Less money from the developer for the MTA in its time of financial need. Less will be done by the developer up front. And the delivery of public benefit is being postponed. So much has changed... Kathy Wylde says she's been supporting this project from the beginning. Not
this project, I'm sorry. But one thing has not changed. The idea that, no matter how much about this project changed, it still needs to be voted for, because this is a wired deal.

As I wrote Friday, the MTA has revised and reduced the goals of the project, dropping a "state-of-the-art" arena and railyard, and no longer describing housing as "critically needed."

PFNYC testimony 2006

In testimony at the 8/23/06 Empire State Development Corporation hearing on the Draft Environmental Impact Statement, Wylde offered more extensive testimony, citing three reasons for support.

Here are excerpts:
First, the density, design and exciting mix of uses planned for Atlantic Yards creates a new anchor for the Downtown Brooklyn business district that will be visible across the borough and the region. Similar to the way that Newport City established the New Jersey waterfront as a prestige destination in the 1980's, Frank Gehry's signature buildings will signal to all who pass within fifty miles, whether by ground or air, Brooklyn's emerging status as the region's most vibrant, 21sl century community. Unlike many other developing areas of the city, the transportation infrastructure needed to accommodate Atlantic Yards is largely in place and the importance of the development ensures that it will rise to the top of priority funding for the additional public facilities and services required to make it successful.

Now, however, there's no Gehry. Nor would there be a business district, as four once-planned office towers, became one office tower, with no plans to build it until an anchor tenant emerges. Well before that hearing, I contended that the office jobs were overpromised from the start.

Second, Atlantic Yards provides desperately needed new housing at a scale that will have a meaningful impact on redressing the imbalance between housing supply and demand that has sent Brooklyn rents and home prices through the roof. Over the past 25 years, the Partnership sponsored development of several thousand of affordable homes and apartments in Fort Greene, Park Slope, Clinton Hill, Crown Heights, Prospect Heights, Windsor Terrace and Bedford Stuyvesant. These were low-rise developments that stabilized fragile neighborhoods and allowed working people to contribute to and enjoy the benefits of Brooklyn's renewal. The density of these developments, however, was never great enough to impact a tight housing market in a meaningful way. Atlantic Yards will do that.

Now, probably not. There are firm plans at this point to build the arena and exactly one tower.

Finally, the Nets and the Nets Arena are important new assets that will greatly contribute to the city's sports and entertainment industry — an increasingly important source of jobs, tax revenues and diversity in the city economy... New York City tends to have a boom and bust economy, but an attraction like the Brooklyn Nets is one of those investments that will attract fans and stimulate business activity even during the down times, helping to insure Brooklyn's long term economic vitality.

Again, such new revenues must be compared to the cost of the subsidies the city and state are putting in. And, as even Forest City Ratner consultant Andrew Zimbalist acknowledged, "The general conclusion that has come out of the academic literature on this subject is that a city, county or state should not anticipate a positive economic or fiscal impact from a new sports facility." He said in 2005, "The idea of supporting a sports arena is similar to supporting a public park. You don't do it because it's going to raise per-capita income."

PFNYC testimony 2004

In testimony before the City Council on 5/4/04, the PFNYC's MarySol Rodriguez said:
First, we want to congratulate the project developer, Bruce Ratner – who is a member of the Partnership – for his successful effort to win a major league franchise for Brooklyn. The acquisition of the Nets is a big deal for the city and a substantial contribution to the borough. The presence of an NBA team will help to galvanize additional private investment in economic development, housing and badly needed recreation facilities throughout Brooklyn.

As noted, the housing's mostly on hold.

Second, we want to express confidence that Forest City will do the right thing by the neighborhoods surrounding Atlantic Yards and the residents and businesses located on the site itself. This is a developer who has remained dedicated to Downtown Brooklyn for more than two decades, long after he could have pulled up stakes and focused exclusively on Manhattan projects.

Does the PFNYC endorse gag orders on those selling their property in the face of eminent domain? As I once wrote, Ratner Plays Hardball When It Counts.

Atlantic Yards will create the critical mass of housing, commercial and entertainment activity needed to firmly establish Downtown Brooklyn’s status as a pre-eminent urban center. The project is a great example of what urban design experts label “smart growth” – that is, a development that capitalizes on the public transportation hub and other urban infrastructure to create a vibrant live-work community. Atlantic Yards will be a destination for residents, visitors, sports fans and workers – not just a bedroom community. It is an example of how we can diversify our city’s economy beyond the Manhattan business districts. And it should be a model for similar projects in Queens, the Bronx and Upper Manhattan.

No one's calling Atlantic Yards a model any more. In fact, former Municipal Art Society president Kent Barwick wondered if Atlantic Yards will be "this generation's Penn Station," an event which galvanizes a more rational and transparent process for development.

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