Thursday, January 28, 2010

Jeffries: "less than cautiously optimistic" on AY, waiting for Paterson response, says ESDC hasn't explained why governance structure isn't needed

At his third annual State of the District address, held last night in the Pratt Institute's Higgins Hall, 57th District Assemblyman Hakeem Jeffries spoke to a supportive crowd about three main issues, none of them Atlantic Yards, though he did answer questions about the project afterward. (See video below.)

His bottom line on AY: after initiating dialogue with the Empire State Development Corporation (ESDC), he's "less than cautiously optimistic" about progress on most issues, including the use of eminent domain and the commitment to build affordable housing expeditiously. (He mentioned a letter to Governor David Paterson that he hadn't released when it was sent in December. It is reproduced at bottom.)

Nor has the ESDC convinced him why Atlantic Yards, unlike such other large projects as Queens West or Brooklyn Bridge Park, does not deserve a separate governance structure to provide oversight over the long term. He was most animated in his frustration over that issue.

Jeffries, unlike other local legislators (City Council Member Letitia James, Assemblyman Jim Brennan, Assemblywoman Joan Millman, and state Senator Velmanette Montgomery), has not gone to court to challenge decisions by the ESDC and the Metropolitan Transportation Authority. He's said that doing so would compromise his advocacy.

Thus he walks a careful line: expressing opposition to eminent domain but not standing with the main groups fighting eminent domain for the project; hoping to ensure that, if the project goes forward, there are jobs for community residents and sufficient affordable housing; and hoping to ensure that, if the project goes forward, there's a credible governance structure.

At the address

Jeffries, in his 25-minute State of the District address, focused most on Project Reclaim, his effort to nudge the state and banks to transform failed market-rate condominiums into affordable housing.

He also talked about the need to ensure that recipients of aid from the federal Housing and Urban Development department, under Section 3, provide job training, jobs, and contracts for housing project residents.

And, citing the still-unresolved case of Shem Walker, an unarmed black man who was shot and killed last July 10 on the steps of his house by a man he apparently mistook for a drug dealer but was an undercover police officer, Jeffries reminded the audience of the need for the police to offer communities mutual respect.

A curious intro

Jeffries was introduced in a promotional video report hosted by a faux-anchorwoman, apparently a production of the Assembly's public relations shop the uncredited Elizabeth Koenig, television and radio analyst on the Assembly channel in Albany.

It included excerpts from three videos: Jeffries testifying in July at an ESDC hearing on Atlantic Yards (originally on AYR, also repurposed on his YouTube channel); Jeffries speaking during a legislative debate about the need for tenant protections; and Jeffries talking about the Walker case before the National Action Network.

Interestingly enough, the excerpt from the ESDC hearing was referred to as testimony about development, but the term "Atlantic Yards" was not mentioned. (Albany ignorance or deliberate obfuscation?)

And the excerpt, in which Jeffries likened the hearing process to a circus, focused not on his criticism of the project but on his attention to his constituents: "And then the circus leaves... but who's left... people desperate for employment opportunities... people gentrified and displaced... who's left when the circus leaves town?"

The Q&A, on video

After the State of the District address, Jeffries met well-wishers and answered questions from four reporters; I got him to step aside to shoot a few minutes of video.



Relationship with FCR

I asked Jeffries if he'd been in contact with Forest City Ratner or the state about the current status of the project.

"I have not had a formal conversation with the developer in months," Jeffries responded. "To tell you the truth, I can't tell you the last time we sat down at the negotiating table."

It's not like there's much to negotiate. However, Jeffries' 2006 achievement--getting the developer to commit to 200 affordable for-sale units onsite--was never formalized in the General Project Plans approved in 2006 and 2009, which includes 2250 affordable rentals.

A commitment to build 600 such for-sale units on or offsite is in the final development agreement, but the enforceability is vague. (The developer agreed with ACORN in the Housing Memorandum of Understanding to build 600 to 1000 such units.)

Dialogue with the state

Jeffries continued: "I have, however, initiated dialogue with the ESDC chair as well as with the governor's office to try to get some of the unresolved issues resolved in a manner that satisfactory for our community."

"I'm less than cautiously optimistic that we can make some substantial progress," he said, "but I'm still hopeful, particularly in areas related to governance of the project, moving forward, and getting the structure in place that gives our communities the same protection as the communities where the Brooklyn Bridge Park is being developed, Queens West, as well as Moynihan Station."

Eminent domain

He said: "I've also made clear to them in a letter that I think that eminent domain should not be used, reiterated that concern, and I'm hopeful that the governor would recognize the passions around this issue and the great uncertainty connected to the Atlantic Yards project that I believe still remains so the situation here doesn't turn into the situation in New London."

After the Court of Appeals decision in November, he said: "The power of eminent domain is extraordinary and should only be authorized in limited circumstances where, unlike in this case, there is a clear and robust public benefit. The use of eminent domain to benefit a private developer to build a basketball arena for a team owned by a foreign billionaire is an abuse of this extraordinary power, and I hope that Governor Paterson will choose not to exercise it."

However, a scenario exactly parallel to that in New London, site of the property at issue in the Supreme Court's controversial 2005 Kelo v. New London decision, is unlikely, since Forest City Ratner and affiliates do plan to build an arena and at least one tower with affordable housing, even if it has no low-income units.

I pointed out that the ESDC plans to go to court on Friday, January 29, in pursuit of condemnation (which property owners and leaseholders will try to resist).

Jeffries responded: "I said we're less than cautiously optimistic and unfortunately in this area I believe that ESDC and the governor have not been sensitive to the concerns that have been voiced by the community around this eminent domain issue and several other issues, and I can only be hopeful that there will be a last minute change of heart."

There's no sign of that.

Gubernatorial review

I asked Jeffries what he'd asked of Paterson.

"The Governor promised to conduct a review of the finances of the project," Jeffries began.

More precisely, Paterson in early December said he'd met with with "a committee of advocates who are opposed to the Atlantic Yards decision... And I have promised them an objective and fair hearing on the issue."

The Governor seemed to be focusing on the decision by the Court of Appeals in the Atlantic Yards eminent domain case rather than the project as a whole, but, given that he acknowledged that the decision couldn't be reversed, left open the possibility of a broader look, even though, in the words of Council Member Letitia James, Paterson has indicated to staffers that "he can't rescind the state's commitment."

Jeffries continued: "In a letter that I sent to him in early December, I said he should halt movement on this project until he is able to convince us that a comprehensive review has been undertaken. Because it makes no sense to have the project move forward on a parallel track with his review, because it essentially makes the review worthless."

I asked if he'd received any response.

"There's been no response to me, with respect to the precise nature of where the review is, other for them to say that it's ongoing," Jeffries said.

Well, the documentation in the master closing sets up damages said to be negotiated at arm's length, which seems to have precluded review.

Back to governance

I asked Jeffries if the governance structure he discussed is the one that groups in BrooklynSpeaks have advocated.

"There's the governance structure that the BrooklynSpeaks folks talked about, which turned into a bill that Velmanette Montgomery and I introduced last session and will reintroduce this session," he said, "but there's also the precedent that has been set by the Local Development Corporation subsidiary context, in projects like Brooklyn Bridge Park, Queens West and Moynihan Station, and ESDC has never given me a good answer as to why our community is treated differently than these other communities, never given me a good answer."

Timetable

I pointed out that, while the state and Forest City Ratner promise to build the project in ten years, documentation provides much looser deadlines.

"I made the point to ESDC that I'm not convinced that the developer will commit to doing this project in a manner that builds the affordable housing to deal with the crisis that we currently are facing right now, or even commit to building the entire thing in the time frame set forth in the four corners of the agreement," Jeffries said. "They have assured me that that agreement will penalize them and obligate them to do it within the time frame that has been set forth. I'm not necessarily convinced right now."

Maybe he being diplomatic or maybe he hadn't looked that carefully, so I asked about the penalties--which, for example (though I didn't mention it), kick in for the third building only after about a decade.

"That's precisely my point," he responded.

The letter to Paterson

December 21, 2009
Hon. David Paterson
Governor
The State of New York
State Capitol
Albany, NY 12224

Dear Governor Paterson:

As you know, I met on December 5 with Larry Schwartz, Jay Walder of the MTA and Dennis Mullen of ESDC regarding the proposed Atlantic Yards development in the Prospect Heights neighborhood I represent. It is my understanding that a few days prior to the meeting, you had the opportunity to meet with other community leaders and residents who share many of my concerns about the project, particularly the utility of continuing to expend substantial state resources on an initiative that may not yield the promised public benefits.

Given these concerns, many in the community have been heartened to learn that you have committed to an objective review of the project’s finances. I respectfully urge you to proceed expeditiously with this review and ask that you restrain the State’s public authorities from moving forward with any further actions related to the construction of the arena until the review has been completed. Otherwise, the independent review will be inconsequential.

Specifically, I request that you delay execution of the agreement between the MTA and Forest City Ratner for the rights to build over the Vanderbilt Yards, and direct the ESDC not to issue bond financing by the Brooklyn Arena LDC. The ESDC should also be prohibited from the exercise of eminent domain to condemn property required for the arena until the review of the project has been completed. Indeed, as we recently learned from the situation in New London, Connecticut, prudence dictates that the extraordinary and irreversible power of eminent domain should be exercised with an abundance of caution.

Thank you for your leadership and consideration.

Sincerely,

_________________________________________________
Hon. Hakeem Jeffries, New York State Assembly, 57th District

On Fox in November

I and others missed this video, which appears on Jeffries' YouTube channel, but he joined attorneys Matthew Brinckerhoff and Rebecca Rose Woodland in discussing the Court of Appeals decision in Brooklyn on the Fox Business Network on Tuesday, November 24th.



The segment began with footprint resident and plaintiff David Sheets saying that the courts should know better than to say the decision is a legislative function.

Given Fox's sympathy to eminent domain critics, the segment was titled "Russian Oligarch and Developer Win Ruling To Take NY Homes," even though Mikhail Prokhorov has not been part of the case and the official defendant was the ESDC, not Forest City Ratner.

Woodland pointed out that, according to the decision, the beneficiary is not merely the developer but the public, because of tax revenues and public uses.

Brinckerhoff responded that the lesson of Kelo is that doesn't come true.

Woodland said, "I don't know that Ratner's going to give up." She suggested that "they're going to build some residential and office towers." (Well, more likely an arena and at least one residential tower.)

Jeffries joins in

Jeffries joined the segment, on the phone: "Eminent domain is an extraordinary government power and it should only be used in limited circumstances... a clear public benefit or an absolute public use."

He said that the record with sports arenas is that "it's just not clear that the eminent domain benefits that some may claim will result."

No appeal, but argument in condemnation case

Brinckerhoff, responding to a question from the moderator, said the case could not be appealed to the U.S. Supreme Court, because a similar case had already been attempted in federal court, but "we will defend the actual taking."

"The court said it was ruling based on the record as it existed three years ago," Brinckerhoff said, but the prospects for the project are very different now, with the arena, according to the New York City Independent Budget Office, seen as a net money loser for city and "all the other properties... contingent on there being a market... all we know is we're getting an arena and 12-14 acres of parking lots."

Well, at least one tower is likely. But we'll have to see that argument in court tomorrow.

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