Friday, April 13, 2012

How the appellate court, in its way, backed up Lupica: "It was a hustle in broad daylight by Caring Bruce Ratner from the start"

After the March 2010 Barclays Center groundbreaking, Daily News sports columnist Mike Lupica commented, "It was a hustle in broad daylight by Caring Bruce Ratner from the start."

The hustle wouldn't have worked without help from Ratner's partner in government, the Empire State Development Corporation, aka Empire State Development (ESD), which had recently completed a clever, devious move, withholding the Development Agreement for Atlantic Yards, thus obscuring the project timetable.

Now the ESD, courts have said definitively, chose expediency over candor, in order to get Atlantic Yards re-approved in 2009 and to enable that groundbreaking. However little the decision may change things on the ground, it's a moral victory and an important message about honest government and the lack thereof. That's news, though not everyone thinks so.

"But the reason why we think Forest City will go forward with this project, and we have every reason to believe so, is that we have a Development Agreement with Forest City that requires it to do so," agency attorney Philip Karmel said in court in January 2010, as detailed below. "I don't know what else ESDC can do."

Well, it could have released that document, which would have revealed how the developer had 12 years to build Phase 1 and 25 years for Phase 2, rather than incentives to get the whole thing done in a decade.

What did the press say?

So here's a round-up of the press coverage, so far of the appellate court's unanimous ruling regarding the state's failure to study the impact of a 25-year project buildout, a failure abetted by the withholding of the Development Agreement.

(That also suggests the likelihood of extended blight, the removal of which was the purported justification for the use of eminent domain. And it raises doubts about the likelihood of the project's benefits, such as jobs, subsidized housing, and new tax revenue, being delivered in ten years.)

As the headlines suggest, some articles drily focused on process, the court decision. Others, including my own, emphasized the meaning of the decision, the fact that the state agency in charge of economic development in New York misled the public.
Times, Daily News--MIA?

Where was the New York Times? It whiffed. (No, The Local doesn't count.) But the Times's City Room blog yesterday devoted nine paragraphs to the departure of Public Advocate Bill de Blasio's communications aide.

That's a consequence of the beat system, where a reporter has responsibility for specific subjects, and a sign that Atlantic Yards remains pretty much an orphan. Times editors of course can focus their staff;  in January 2010, the Times spent more than 700 words in print to cover a Nets promotional visit in Brooklyn.

My prediction: news of this important ruling will be folded into a round-up article about the arena's progress and lingering concerns (parking, liquor license, etc.), just as the Times did last June in response to the lower court's ruling in this case.

There's nothing on the Daily News website either, though sometimes they're print first. The newspaper does have a two-byline article on a gourmet mayonnaise store on Vanderbilt Avenue in Prospect Heights, just a few strides from the "blighted" Atlantic Yards footprint above Dean Street.

The New York Observer, which once paid serious attention to Atlantic Yards, is also whiffing, at least so far.

Moral victories, explanations, and apologies

The Patch article quoted me:
“The ruling represents a moral victory, if not necessarily an instrumental one; ESD surely will re-approve the project and issue a study, already begun (as a hedge) that likely will find few significant new impacts,” Oder wrote on Atlantic Yards Report.
But Develop Don’t Destroy Brooklyn, one of the petitioners, suggests that elected officials change course, and bring in additional developers to develop the 22-acre site.
DDDB's goal is possible, but unlikely, given that Gov. Andrew Cuomo has shown no sign of reforming the agency he inherited, at least regarding Atlantic Yards. Still, perhaps the study will show more candor than I first suspected.

However, a moral victory is significant unto itself. Atlantic Yards critics and opponents have long said the process behind the project looked fishy. Two courts have confirmed that. The ruling yesterday was unanimous.

On Meadowlands Matters, John Brennan wrote:
Sounds like ESDC has some ‘splainin’ to do. I’ll be curious to see if the mainstream New York media digs deeper, considering we have a multi-billion New York City project here – and successive court rulings rebuking the judgment of the state agency that is supposed to be the people’s watchdog to make sure the project rolls out properly.
But there was no explaining, and there was no apology. Both the state agency and Forest City expressed disappointment with the ruling and said they were moving ahead with the project.

This was business, man, and most of the key ESDC staffers in charge of Atlantic Yards when the Development Agreement was withheld--remember attorneys Steve Matlin and Anita Laremont?--have safely retired.

Cuomo could apologize. It wasn't his fault. He inherited this after his election in 2010. But he's shown no such inclination. But he wants to go to an arena ribbon-cutting too, right? It's good television.

The delay in the Development Agreement

Though the courts didn't go there, evidence suggests the ESD simply cheated. Atlantic Yards was re-approved in September 2009 to allow for multiple phases of condemnations, rather than one full round, thus saving Forest City Ratner from paying to acquire the property it didn't need soon.

The timetable for the project would be enforced by the Atlantic Yards master closing documents, including the Development Agreement, which were signed in December 2009. But those documents weren't released until 1/25/10, six days after the first hearing in this case was heard in court.

It was also nearly three weeks after the ESDC told me the documents would be made available.

At left are the essential elements of an email exchange I had with ESDC spokeswoman Elizabeth Mitchell in mid-December 2009. (The second and third elements in bold have been added for clarity.)

She said the document(s) would not be made available "until a week or two after the closing," meaning approximately 12/30/09 through 1/6/10. That didn't happen.

It's another confirmation of what New York Magazine's Chris Smith wrote in August 2006:
As a political reporter, I know that money and spin usually win. But in looking at Atlantic Yards up close, it’s outrageous to see the absolute absence of democratic process.
Counterfactual history

As Develop Don't Destroy Brooklyn's Candace Carpenter said yesterday, "The tragedy here is, but for the blatant misrepresentations to the Court by Forest City Ratner and ESDC, it would been determined in 2010 that an SEIS was required and that would have stopped construction of Barclays Arena."

Maybe, maybe not--there was still a ton of political momentum. But it would have been a lot easier to stop it before the groundbreaking.

The case was initially argued 1/19/10.

It was decided 3/10/10, a day before the arena groundbreaking. In that decision, Supreme Court Justice Marcy Friedman criticized the ESDC’s “deplorable lack of transparency” and acknowledged that the ESDC’s use of a ten-year timeframe for the project buildout in the Modified General Project Plan was supported “only minimally.”

In that case, the main document was the agreement with the MTA for the Vanderbilt Yard, which gave Forest City Ratner 22 years to pay for the development rights. However, the Development Agreement offered far more reason for skepticism, as it showed a clear contradiction with the professed time frame.

But Friedman did not allow it to be entered into the record. Later, after both sets of petitioners asked Friedman to reopen the case, she did, acknowledging a misapprehension--though not quite a mistake on her part--about the Development Agreement.

In November 2010, Friedman remanded the proceedings "to ESDC for findings on the impact of the Development Agreement and of the renegotiated MTA agreement on its continued use of a 10 year build-out for the Project, and on whether a Supplemental Environmental Impact Statement is required or warranted."

She rejected those finding, and the appellate court agreed. It's just taken well over two years. Where would we be if the Development Agreement had been released on time?

The transcript of the Jan. 2010 hearing

The discussion begins on page 222 of the document below, but I've excerpted the key passages from ESDC lawyer Philip Karmel, who said "we're relying on the contracts that we are negotiating," a statement the implies they were not settled, though he then said, "We have a Development Agreement."

The principal terms of the agreement, he said, were outlined in the record. They weren't, because no one knew how light the penalties were. "Well, the penalties are not set forth in the record," Karmel admitted. That's where, in retrospect, the court should have stepped in.




Somewhat later Karmel returned to the theme:

Develop Don't Destroy Brooklyn attorney Jeffrey Baker responded later:
He added:
Here, Baker explains how the document was withheld:


Transcript of Jan. 2010 hearing (go to p. 222)

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