Thursday, October 31, 2013

The triumph of Bill de Blasio is nearly complete: NY Times lets him blather on Atlantic Yards without applying skepticism

A team of New York Times reporters, including one who notably got Republican mayoral candidate Joe Lhota to defend the indefensible (the Madison Square Garden tax break), today produce a profile of Democratic front-runner Bill de Blasio that offers some passages of tough scrutiny but ends--and whiffs--on Atlantic Yards.

It's a disturbing abdication of journalistic skepticism and a sign of how he-said, she-said journalism disserves readers, with de Blasio getting the undeserved last word despite a record of slipperiness and absence on Atlantic Yards.

The article, On Council, de Blasio Blended Idealism With Push for Power, ends with these paragraphs:
But it was the Atlantic Yards project, a gigantic housing and arena development at the intersection of Flatbush and Atlantic Avenues, that cemented the image of Mr. de Blasio in some critics’ minds as a too-willing partner for developers.

Eric McClure, a founder of the civic group Park Slope Neighbors, met with Mr. de Blasio, hoping that 2,200 signatures he had gathered on a petition would be enough to turn the councilman into a critic of the project. He did not succeed; Mr. de Blasio argued that development was needed to create affordable housing.

“He was insistent,” Mr. McClure recalled. “We had an affordable housing crisis, sometimes you have to do certain things to get that affordable housing built that might rub people the wrong way, but that was the ultimate goal, and for that reason he was for the project.”

Mr. de Blasio, according to Mr. McClure, acknowledged that Fourth Avenue “had not turned out the way he hoped.” But he argued that Atlantic Yards would be different, because Acorn, a community organizing group with which he had a long association, had joined the developer, Forest City Ratner, to see that the affordable housing was built.

The Barclays Center arena opened in 2012, but the first affordable apartments are still at least a year away. Critics say that Mr. de Blasio was too close to the developer, Bruce Ratner, who hosted a birthday fund-raiser for him, and did not push the firm, Forest City Ratner, to deliver the promised housing.

On Monday Mr. de Blasio blamed some “objective reasons” for the delay, but said “it’s clearly behind schedule,” and allowed that “there were missteps by everyone involved.” He said the next mayor needed to hold Forest City Ratner and state officials accountable.

“On my watch, it will happen,” he vowed.
And it may, in ways that do not at all represent accountability.

What they missed

As I wrote Monday, de Blasio can be challenged on:
  • his failure, as Public Advocate, to issue any comment on Forest City's failure to meet its promised goal of 50% (in floor area) family-sized units in the first tower, which is under construction
  • how exactly de Blasio has, as he has claimed "pressured" Forest City on the housing? (he's said nothing publicly)
  • the Public Advocate's failure to say anything about Forest City's failure to hire the promised Independent Compliance Monitor required in the Community Benefits Agreement
  • how he plans to speed such housing as mayor--does that mean he'll devote more subsidies?
More here. A profile this week in Politicker contained a quote that helps explain de Blasio's Atlantic Yards support. He was said to be "a surface guy, total surface. He’s not in the weeds."

Also see coverage in WNYC and Capital New York (with my comments linked) that was tougher on de Blasio.

Responding on Twitter

Wednesday, October 30, 2013

NYPD traffic division (finally) pledges to push on illegal parking around Barclays Center; ESD "pleased" with overall project

It's been a persistent issue since the Barclays Center opened: illegal parking and idling in the blocks around the arena. But cops focused on controlling crime have not made traffic enforcement a priority, as some neighbors have regularly pointed out.

Indeed, the work can be best done by the New York Police Department's (NYPD) civilian wing and, finally, the reinforcements are coming.

"First, we weren't aware that there was an issue with parking illegally around the perimeter of the Barclays Center," NYPD Traffic Enforcement District Manager Donald Powe told last night's 78th Precinct Community Council meeting.

That comment prompted some raised eyebrows regarding the belated awareness and the communication within the overall department, since Deputy Inspector Michael Ameri, commanding officer of the 78th Precinct, has been very much alerted to the issue.

"Now that we are aware of it, we will devote a few patrol cars" to the streets where problems have been recorded, Powe said, and "issue some summonses" where violations--such as cars parked at hydrants and bus stops--are found. (This wing of the NYPD also supplies Traffic Enforcement Agents whose focus is--and has been, in the case of the arena--on moving traffic.)

When will they start? At the next arena event, Powe said. (That would be the Brooklyn Nets' season debut versus the defending champion Miami Heat this Friday night, sure to sell out.)

For how long? "It'll be ongoing," he replied.

Note that Traffic Enforcement Agents are civilian members of the Department. They must pass 12 weeks of training in parking and traffic rules and regulations, intersection control and ticketing before being assigned to posts throughout New York City.

ESD comments

Given a chance to comment to the group, Derek Lynch, community and government relations manager for Empire State Development (ESD), said, "The state is continuing to monitor the project. we're pleased with the way the project is unfolding so far. We're excited about the partnership with [potential Chinese investor] Greenland and think this is an opportunity to hopefully speed the process up and get affordable housing built quicker."

I asked about reports of sounds penetrating residences during Saturday night's Sensation show.

"We did hear it. We are aware of the issue and the concerns," he said, noting that the city Department of Environmental Protection "was out there that night monitoring and testing."

When exactly?

"DEP told me they were out there from 7 to 8 and also from 10 to 12," Lynch replied.

It may be that the DEP was in the area of the arena, but I'm told they were not measuring sound inside the Newswalk building during that later period--and that the sound got louder.

BerlinRosen founders say "mission-driven company" turns away clients who don't share ideals (so, what about Ratner?)

Bloomberg News two days ago published a profile of BerlinRosen, headlined NYC Firm Helps De Blasio Go From Obscurity to Frontrunner:
BerlinRosen Public Affairs, the eight-year-old firm founded by Valerie Berlin and Jonathan Rosen, has built a reputation working behind the scenes for Democratic candidates and causes such as paid sick leave, limiting police stop-and-frisk tactics and universal preschool -- issues that dominated [Democratic nominee Bill] de Blasio’s message and helped take the 52-year-old from underdog to frontrunner.
With polls showing de Blasio 40 percentage points ahead of Joseph Lhota a week before the election, and with Lhota’s fellow Republicans outnumbered 6-to-1 in the most populous U.S. city, de Blasio is likely to be the first Democrat to run New York since 1993. That leaves BerlinRosen poised to extend its influence and access to power.
The company sounds idealistic

The article states:
They call it a mission-driven company and said they turn away potential clients who don’t share their ideals and values. Some organizations they represent advocate raising the minimum wage, protecting voting rights and providing more services for poor children and families.
...Interviews with a dozen clients and peers elicited descriptions of BerlinRosen’s staff as smart, hard-working and good listeners... Assembly speaker [Sheldon] Silver said he relies on Rosen as a “trusted adviser.”
Um, should working for speaker-for-life Silver be a red flag?

The corporate biz

The article states:
They’ve also represented Brookfield Office Properties, a subsidiary of the owner of Zuccotti Park, from which Occupy Wall Street was ousted in 2011, and Bruce Ratner, founder and chairman of Forest City Ratner Cos., developer of Brooklyn’s 22-acre Atlantic Yards, which includes Barclays Center with plans for thousands of market-rate and discount apartments.
My comment

I posted a comment responding on this line, "They call it a mission-driven company and said they turn away potential clients who don’t share their ideals and values."
Hmm... If you want to understand developer Forest City Ratner, check out the two posts below: "Atlantic Yards and The Culture of Cheating" and the story behind the developer's Yonkers project.
And, perhaps, count the number of people in FCR's orbit who get indicted.

Tuesday, October 29, 2013

Former Forest City Ratner lobbyist Melvin Lowe, Sampson crony, charged with corruption; charges do not involve developer

From the New York Times, New York Political Consultant Charged in Corruption Case:
An influential political consultant whose clients include the New York Democratic Senatorial Campaign Committee and leading real estate developers, including Forest City Ratner, was arrested on federal corruption charges on Tuesday morning.
...The charges include wire fraud, bank fraud and criminal tax violations.

The complaint says, among other things, that Mr. Lowe had failed to report more than $2 million in consulting income and used a false-invoice scheme to defraud the Democratic Senate Campaign Committee (DSCC), as well as those who contributed to it, of $100,000.
As it happens, none of the charges involve Forest City or any other developer. But it continues a remarkable string of corruption charges regarding people with ties to Forest City.

Crain's reports:
The complaint refers to an unnamed political consultant "Vendor #1" that appears to be Cornerstone Management Partners, which is owned by political operative Elnatan Rudolph. "Vendor #1" is said to have helped Mr. Lowe and an unnamed political consultant bilk $100,000 from the Democratic Senate Campaign Committee without providing any actual services.
In 2010, while at City & State, this reporter wrote at some length about speculation that Michael Cohen, the former district office chief of staff for then-Majority Leader John Sampson of Brooklyn, had landed the $100,000 worth of work for Mr. Rudolph, who was a Brooklyn political operative in his early 20s. The two were childhood best friends. But notion was vehemently denied by a Democratic Senate Campaign Committee spokesman at the time. It's still not clear if Mr. Cohen had any role whatsoever in the alleged plot, and there's no suggestion of wrongdoing by any Senate staffers in the complaint's 12 pages.
The Sampson connection

Lowe, who's close to former Senate Majority Leader John Sampson, himself indicted, has a curious history, as City and State reported in 2010: Largely Unknown DSCC Consultant Cleared $300k In Last Year. That article noted:
Immediately before starting with Sampson and the DSCC, Lowe was a lobbyist for Forest City Ratner Companies, helping lobby on behalf of the Atlantic Yards. While at that job, Lowe got involved in the Ridge Hill development in Yonkers and is among the people mentioned in subpoenas that came out of the local U.S. Attorney’s office related to the passage of that project.
The Yonkers connection

Lowe was mentioned, though not called as a witness, during the 2012 Yonkers corruption trial. "Are you familiar with a company known as Westchester Invaders?" asked William Aronwald, defense attorney for Sandy Annabi, the former Council Member who flipped her vote to benefit Forest City's Ridge Hill project and was later convicted. 

"Isn't it true Forest City Ratner made a contribution of $10,000 to Westchester Invaders at Council Member [Patricia] McDow's or [FCR lobbyist] Melvin Lowe's request?"

"I can't recall," replied former Forest City governmental affairs EVP Bruce Bender.

As I wrote, Westchester Invaders is a drum and bugle corps that McDow has saluted, but I couldn't find corroborating evidence of a Forest City Ratner contribution. Then again, it would not be out of line with company practices in Brooklyn.

The Boyland connection

City and State also reported that Lowe earned $16,000 from the campaign of former Council Member Tracy Boyland when she challenged state Sen. Velmanette Montgomery in 2006. Boyland received tacit if not explicit support from Forest City in that race.

She used the same consulting firm--Knickerbocker SKD--that FCR used for its deceptive Atlantic Yards mailers. A push-poll from Pacific Crest Research, which had conducted a previous push-poll on Atlantic Yards, seemed to steer listeners to Boyland. Crain's reported that Forest City executive Bruce Bender was helping Boyland raise money.

The legal clouds thicken

The arrest of Lowe means yet another person charged or convicted of corruption has or has had a business relationship with Forest City Ratner. The names include John Sampson (charged), William Rapfogel (charged), Carl Kruger (convicted), Richard Lipsky (convicted), Sandy Annabi and Zehy Jereis (convicted).

Lhota's charges against de Blasio on Atlantic Yards generate (vague) pledge from Democrat; Republican has own accountability issue regarding MSG

So, Republican mayoral candidate Joe Lhota garnered some headlines for his attack yesterday on Democratic front-runner Bill de Blasio's stance on Atlantic Yards, and though his charges were not all on point, he did drive home the fact that de Blasio has been quiet about developer Forest City Ratner.

Most of the subsequent articles turned into a he-said, he-said account, with de Blasio pointing to Lhota's apparent hypocrisy--the former MTA head did praise Atlantic Yards effusively last year--without adding that Lhota is trying to thread the needle and point to lapses since then.

Then again, Lhota last year could have pointed to delays in affordable housing as well as de Blasio's failure to criticize Forest City Ratner for failing to hire a compliance monitor for the Community Benefits Agreement.

The fact is, the delays do not violate state contracts, but de Blasio is vulnerable to not criticizing the failure of Forest City to meet the CBA's promises regarding affordable housing configuration in the first tower, which is under construction.

So his stance is partly expediency, though yesterday Lhota also pointed to a previously unmentioned episode that apparently hardened his stance toward the developer: Forest City's alleged near-default on promises to start the new railyard, an obligation that was deferred in 2012 and again this month.

And while it's certainly plausible for Lhota to suggest that Forest City Ratner's support has hindered de Blasio's criticism, it's equally plausible that de Blasio has backed off Atlantic Yards because of obligations to supporters like ex-ACORN head Bertha Lewis and her allies in the Working Families Party--another AY thread that most journalists haven't picked up (though WNYC's Matthew Schuerman did last month).

A blow to Lhota's stance on accountability

Also, Lhota's stance on accountability toward his old employer, Madison Square Garden, took a hit in a New York Times profile today:
The Lhota press conference, interestingly enough, was ignored in the Times, though I suspect it may come up in future articles.

The coverage: AP

Likely the most widely circulated article came from the Associated Press: Lhota: Atlantic Yards Developers "Bought" de Blasio, with the deck "Lhota said his opponent has not fulfilled promises to create affordable housing as part of the massive $5 billion Brooklyn project."
Lhota, the Republican nominee, tried to the move to the left of the liberal de Blasio, saying the Democrat has not fulfilled promises to create affordable housing as part of the massive $5 billion project, which includes the Barclays Center, the home of the Brooklyn Nets.
"Bill de Blasio has been all talk and no action when it comes to affordable housing," Lhota told reporters. "Bill de Blasio has been absolutely silent. He's been silent because he's been bought."
I'm not sure it's actually a "move to the left" but rather an effort toward accountability--though, as noted, Lhota has his own problems.

And Atlantic Yards should not be a proxy for affordable housing, because it's a single project based on a carefully negotiated contract with the state, rather than an overall city policy. It should be sufficient for Lhota to say de Blasio has been elastic and opportunistic," to quote NY magazine's Chris Smith

It was the latest in a string of attacks in recent weeks that Lhota has bombarded de Blasio with, including on such issues as public safety and charter schools. But Lhota has yet to make a dent in the Democrat's commanding lead in the polls.

The Democrat's pledge

The AP reported:
De Blasio, now the public advocate, voted for the project in 2006 while a city councilman. He acknowledged Monday that the affordable housing meant to be built as part of Atlantic Yards, which will also include commercial and office space, has fallen behind schedule. But he defended his role in supporting the project, which drew opposition from many local community groups.
"From the beginning of the process around Atlantic Yards, I have fought for maximum community benefits," said de Blasio, who said he has held the `"feet of the state and the developer to the fire" to push the housing though. "On my watch, it will happen."
Actually, de Blasio did not "vote for the project," since it didn't go through the city approval process. All he did was approve an overall city budget, with no line-item veto, that included subsidies for the project.

As to whether de Blasio has "fought for maximum community benefits" and has "held" anyone's feet to the fire, that demands follow-up. How? There's no evidence.

The toughest coverage: Daily News

Interestingly enough, the toughest article came from the New York Daily News, which (via other reporters) is generally generous toward Forest City Ratner. (The New York Post, which is more pro-Lhota, ran a brief article that gave de Blasio no chance to respond.)

The Daily News article was headlined Joe Lhota slams Bill de Blasio over being quiet on affordable housing in Atlantic Yards:
“He was silent because he was bought,” said Lhota, standing across the street from the gleaming Barclay’s Center, the anchor of the $5 billion development.
“The people who built the Barclay’s Center and promised to build all of the affordable housing have given contributions to him over and over again.”
As a City Council member from Brooklyn and then as the city’s Public Advocate, de Blasio bucked neighborhood opposition and supported the controversial project.
Ratner has received tax breaks and loans worth more than $760 million to build the project, which is supposed to include the 2,250 units of affordable housing. But nearly eight years after the project was approved, the first 181 affordable housing units won’t break ground until next year. And there is no concrete timetable for the other units.
Actually, the first building broke ground last year, but won't open til next year. The article says Ratner and associates "have raised more than $73,000 for de Blasio’s campaign," a total I hadn't previously found.

de Blasio's response, and a rebuttal

The article continued:
De Blasio on Monday acknowledged that the affordable units are “clearly behind schedule” and blamed “missteps by everyone involved.” He said “the city and state should have played a more active role.”
Contacted by the Daily News, neighborhood activists who’ve long opposed the project lashed out at de Blasio on Monday.
“Bill has not stuck his neck out at all on this,” said Candace Carponter, legal counsel for Develop Don’t Destroy Brooklyn, the coalition of groups that has long opposed Ratner’s plan.
“Bill has been a complete political opportunist and has not stood up for his constituency.”
Well, de Blasio defines his constituency differently. But Daniel Goldstein, co-founder of Develop Don’t Destroy, was surely on point in saying,  “I don't expect a de Blasio administration to be very tough on Forest City Ratner.”

Other coverage

Capital New York ran Lhota accuses de Blasio, again, of being soft on Bruce Ratner, which cited Council Member Letitia James's criticism of Atlantic Yards and quoted Lhota as saying Community Benefit Agreements must have clawbacks.

Actually, that should be in the development agreement signed with public parties.

Politicker published Lhota Says Developers Have ‘Bought’ de Blasio’s Silence on Atlantic Yards, suggesting "Lhota tacked to the left." Actually, Atlantic Yards is less a left-right issue than about accountability.

The article ended with a quote from a de Blasio spokeswoman but no concrete statement from de Blasio about how he will make sure "Atlantic Yards delivers the affordable housing that was originally planned." As I've said, that could mean more subsidies.

Newsday published Joe Lhota: Atlantic Yards developers 'bought' de Blasio, noting tellingly, "Neither candidate detailed how they would hold the developer accountable."

There are carrots and there are sticks. One way to pursue accountability is to hold tight to the carrots, such as affordable housing subsidies, which are negotiable, as we have learned.

The importance of timing

Crain's reported on late-arriving real-estate industry contributions to de Blasio:
"Somewhere in de Blasio's camp, someone is keeping tabs on who gave what and when," one real estate source said. "And there is no chance whatsoever that money now is worth what money was in June when he was at 10% in the polls. That certainly applies to the late-arriving unions, as well businesses and some real estate. The real winners are the early endorsers and early donors. Buying de Blasio stock at its 52-week high isn't going to produce a bonanza of goodwill."
That would make early donor Bruce Ratner a winner.

Was Atlantic Yards the wrong issue?

From the latest Atlantic Yards Construction Alert: new crane means one-day closing of Dean Street next to site; loading dock access via Sixth Avenue

According to the latest two-week Atlantic Yards Construction Alert, dated October 28 and distributed yesterday by Empire State Development after preparation by developer Forest City Ratner, Dean Street--apparently between Flatbush and Sixth avenues, but not specified--will be closed from 9 am to 9 pm on one day during this period to allow the erection of the tower crane and removal of the crawler crane.

According to Wikipedia, a crawler is crane mounted on an undercarriage with a set of tracks (also called crawlers), while a tower crane is fixed to the ground on a concrete slab. Note that the previous Construction Alert described the upcoming installation of the tower crane but not the removal of the crawler crane.

Also, there will be some railyard activity after a hiatus, involving SOE (support of excavation) work.

From the document
B-2 Tower, Modular Residential• Installation of temporary power and lights will be maintained throughout the project.
• Backfilling will commence during this reporting period.
• Subject to receipt of all approvals from DOB/MTA/DOT, erection of the tower crane will commence during the week of October 28th
• Subject to receipt of necessary permits, erection of the tower crane and removal of the crawler crane will take place during the week of October 28th. This work will require the closure of Dean Street from 9 AM TO 9 PM. Access to the Arena’s loading dock will be coordinated via 6th Avenue.
• Work related to site utilities will commence during this reporting period.
• Daily cleanup activities of sidewalks and streets are ongoing as required.
• Tentatively there are no construction activities scheduled for the upcoming Saturdays during this reporting period.
LIRR Yard Activities Block 1120 & 1121• Contractor to begin mobilizing for SOE Installation Work along Pacific Street between Carlton and Vanderbilt during this reporting period.
• Contractor to begin MPT installation along Pacific Street between Carlton and Vanderbilt during this reporting period.
Atlantic Yards two-week Construction Alert, October 28 2013

Monday, October 28, 2013

Across from arena, Lhota slams de Blasio (again) on Atlantic Yards, claims Ratner close to default on MTA railyard last year (video)

Seeking to shore up a campaign deeply behind in the polls, Republican mayoral nominee Joe Lhota came to the intersection of Flatbush Avenue and Dean Street this afternoon, with the arena and the site for the first housing tower in the background, and again slammed rival Bill de Blasio, the Democratic nominee, regarding his failure to criticize Atlantic Yards while taking contributions from the developer.

"Bill de Blasio has been all talk and no action when it comes to affordable housing," said the former MTA head, pointing to a quote from the then-Council Member regarding the Atlantic Yards Community Benefits Agreement: “It’s the responsibility of all of us, and especially of we elected officials, to ensure that it is scrupulously adhered to.”

Lhota got some traction--he was his most pointed yet in targeting de Blasio's failure to follow through on the CBA, including developer Forest City Ratner's failure to hire a promised Independent Compliance Monitor.

And he called "the most important statement" was one from de Blasio ally Council Member Letitia James, who's set to be the next Public Advocate, as criticizing de Blasio and others as getting duped. (Of course James surely wasn't saying that in support of Lhota.)

Threading the needle

But Lhota was also forced to thread the needle. Before the press conference, the de Blasio campaign pointed to an interview (with photo) Lhota gave the New York Daily News last year, before the arena opened, when he declared, "How long are people going to criticize this project before they realize this is good for New York City?”

Confronted with that, Lhota said, "If this project as envisioned went forward, it's a great project." (That of course endorses the project at the scale approved, which is very questionable.)

Though Lhota said he supported "clawbacks," or penalties if promises are not fulfilled, he was, understandably, fuzzy about what actually could be done at this point. The main deal, the Development Agreement, is with the Empire State Development Corporation, a state agency, and no public agency was party to the Atlantic Yards Community Benefits Agreement, a private contract that only the parties can resolve. So the only oversight over the latter is rhetorical.

But his remarks, at least, suggested a different rhetorical posture: a willingness to be more adversarial and more critical than de Blasio.

"He's been silent because he's been bought," Lhota said of de Blasio, though arguably de Blasio's dependence on ex-ACORN head Bertha Lewis--who signed the Atlantic Yards housing deal--and her allies in the Working Families Party is as important if not more so.

An Atlantic Yards revelation (of sorts)

"It's no surprise the de Blasio campaign's pointing out you praised this project," one reporter noted.

"When I was at the MTA, I held Forest City Ratner's feet to the fire to fllow through on agreements that were made with the MTA," Lhota responded. "We were within hours of a default, where he was not following through on building the railyard that he promised to build."

"I love the fact that we have in my neighborhood this facility," said Lhota, who lives in not-so-close Brooklyn Heights, but said "I deplore the fact that the developer did not follow through on what he said. Anybody who tells you I've applauded this project is sadly mistaken"--seemingly contradicted by that quote to the Daily News--"because I'm on the record as holding his feet to the fire, something Bill de Blasio wouldn't understand."

I asked him to follow up. Lhota said Forest City hadn't started the railyard "at the time they were supposed to start" and he got additional guarantees from them.

I'm not quite sure that shows the MTA as cracking down on Forest City, but Lhota was also answering to Gov. Andrew Cuomo, who's essentially a project supporter. Forest City got the official start date for the railyard put off 18 months, with the deal announced before the official start date.

In exchange, Forest City put down a $10 million completion guarantee for that interim work. The MTA portrayed that as essentially leaving them in as good a place.

I spoke to Lhota briefly after the press conference and mentioned that Forest City had recently again renegotiated, getting the MTA to push back the official start date for six months, to June 2014. He said he didn't know about it. Maybe that's because no news outlets followed up.

The press release 

This had paragraph breaks when presented to the press, but not on the website:
Lhota: de Blasio all talk, no action on affordable housingDespite Pledging to Ensure Affordable Housing, de Blasio Remained Silent While Taking Thousands in Campaign Contributions From DeveloperBrooklyn, NY–October 28th…Bill de Blasio is all talk and no action when it comes to the creation of affordable housing, Mr. Lhota today charged. Standing at the intersection between Flatbush Avenue and Dean Street, the proposed site of Atlantic Yards housing development project, Mr. Lhota condemned his opponent’s failure to follow through on his commitment to ensure affordable housing, while accepting thousands in campaign contributions from the project’s developer.
As City Councilman, Mr. de Blasio was a key ally in the Atlantic Yards deal, amid much local opposition, praising an agreement the developer signed with community groups promising the creation of affordable housing. At the time of the agreement, Mr. de Blasio tasked himself with the job of policing the developer to follow through with his commitment. He stated, “It’s the responsibility of all of us, and especially of we elected officials, to ensure that it is scrupulously adhered to.”
Despite promising he would make sure the community benefits agreement was fulfilled, Mr. de Blasio has been silent while seven years have passed and the affordable housing has yet to come to fruition. During this same time period, he has taken thousands in campaign contributions from the project’s developer, Forest City Ratner, and his associates. In 2011, Bruce Ratner co-chaired a 50th birthday fundraiser for Mr. de Blasio.
“Like everything else in his campaign platform, Mr. de Blasio makes promises that he can’t or won’t fulfill,” said Mr. Lhota. “He talks a good game about the need for affordable housing and rails against private developers, but his actions have proved the exact opposite. He broke his promise to the taxpayers, capitulated to the developer and zipped his lips while taking thousands in campaign contributions. Is he going to be that easy to roll over as mayor?”
Even Mr. de Blasio’s political ally and presumptive successor in the public advocate’s office has been frustrated with his failure to deliver, stating “So many elected officials gave to that project and were instrumental in getting it financed,” said Letitia James. “Not one has made any comment with regard to the fact that New Yorkers and taxpayers were basically duped. And that includes the current public advocate, Bill de Blasio, and others.”

Payback or just the best deal? de Blasio rents campaign HQ in Brooklyn from campaign supporter Ratner

Maybe it was the best deal available, as I'm sure Bill de Blasio's campaign would say, or maybe it's payback of sorts, as I suspect critics might say.

Democratic mayoral nominee de Blasio is paying developer Forest City Ratner--whose executives have raised campaign funds for him and co-hosted a fundraiser--$5,000 to rent his campaign headquarters in Brooklyn.

The location is 345 Jay Street in MetroTech, a space occupied by Sid's Hardware until early 2010.

(Since then, the raw space hasn't had a long-term tenant, which means it has not been easy to lease--a Sid's store manager said in 2010 that "the rents are too high, there’s no parking, and this dead scene isn’t a place to run a business." It has been used--in two if not all three cases donated--for a bone marrow drive in May 2013, the Brooklyn Folk Festival in May 2012 and a Guggenheim pop-up gallery in May 2011.)

Campaign headquarters

While the official home of New Yorkers for de Blasio is 32 Court Street in Downtown Brooklyn, this space at 345 Jay is listed on hand-lettered signs and in some web announcements, such as the MeetUp announcement at left, as "campaign headquarters."

I suspect there's a plausible explanation for the lease, that it was better-priced, better-located space than the alternatives, and it might well be. (I submitted questions, including the term of the lease, to a campaign rep earlier this morning.)

Plausible, but unseemly

But it's also somewhat unseemly, a bit of you-scratch-my-back-I'll-scratch-yours.

Note that de Blasio has been unwilling, for example, to criticize Forest City regarding Atlantic Yards--he reserves criticism for the "process" and repeats Forest City talking points.

So this business relationship suggests another sign of coziness between the candidate--sometimes "elastic and opportunistic" (to quote NY magazine's Chris Smith)--and the developer.


The lease is disclosed in de Blasio's campaign finance report:

"Heard it from my living room": Sensation again booms bass into residences near Barclays Center (but will there be a fine?)

The Sensation crowd gathers
It happened a year ago, and it happened again this past Saturday: bass noise from the Sensation dance party penetrated residences several blocks away, after midnight, when people should be sleeping.

As with the 2012 show, it's likely the Barclays Center will escape without a fine. Last year, the levels measured seemed twice as loud as permitted, but the proposed violation was dismissed for technical reasons. (Later, the arena paid a $3200 fine for another dance show, featuring Swedish House Mafia.)

Similarly, this past Saturday, the city Department of Environmental Protection measured noise levels, I'm told, near the beginning of the show, but didn't stick around to measure as the pounding bass grew louder. Though I can't be sure, that suggests they missed the bigger problem, and won't issue a fine.

The reports
Security check outside

Consider this report from Atlantic Yards Watch, Bass sound leakage from Sensation concert
Submitted by ParkSloper on October 27, 2013 - 7:52am
Location: St Mark's Avenue between 5th and 6th
When: October 27, 2013 - 1:00am
311: yes
Disturbed by distinctive bass sound thumping at 1AM inside bedroom with closed windows several blocks away. Reported to 311 but unable to track number.

Or on Twitter: "Heard it from my living room."
I'm told about seven or eight other people registered complaints, with many from the Newswalk residence on Pacific Street near the arena.

There's clearly a tension between the arena's desire for revenue-producing events and the limits of the building design. That tension so far is almost completely unmediated by any regulators. It will be mediated by the construction of a residential building adjacent to the arena.

Lhota to attack de Blasio over Atlantic Yards housing failures; new video of Forest City promise of Independent Compliance Monitor for CBA

From City and State's First Read newsletter:
12 p.m. – [Republican mayoral candidate Joe] Lhota calls for [Democratic mayoral candidate Bill] de Blasio to address failures in the creation of affordable housing in the Atlantic Yards project, Flatbush Avenue and Dean Street, Brooklyn.
This will be interesting. As I've written, there's little de Blasio can do to speed creation of the affordable housing, given that state contracts give developer Forest City Ratner a long leash. But he has been mushy-mouthed or silent on key issues.

That said, de Blasio can be challenged on:
  • his failure, as Public Advocate, to issue any comment on Forest City's failure to meet its promised goal of 50% (in floor area) family-sized units in the first tower, which is under construction
  • how exactly de Blasio has, as he has claimed "pressured" Forest City on the housing? (he's said nothing publicly)
  • the Public Advocate's failure to say anything about Forest City's failure to hire the promised Independent Compliance Monitor required in the Community Benefits Agreement
  • how he plans to speed such housing as mayor--does that mean he'll devote more subsidies?
Ex-ACORN pushback?

I would not be surprised if de Blasio supporters associated with ACORN and successor groups show up to heckle/protest. Unless they think it's unnecessary, given the Public Advocate's huge lead in the polls.

Note that Bertha Lewis, former head of New York (and national) ACORN and a big de Blasio supporter, is also Forest City Ratner's partner on the Atlantic Yards affordable housing. Not only did Lewis sign an agreement promising to support the project publicly, she also owes Forest City big time.

After Lewis took over national ACORN, which faced huge losses after an internal embezzlement scandal, Forest City bailed out ACORN with a $1.5 million grant/loan, and when ACORN folded in 2010, Forest City was the organization's largest creditor.

New York mag on de Blasio

From Chris Smith's cover story today, in New York magazine, The 99% Mayor: Bill de Blasio’s promise may also be his problem."
As a council member, De Blasio did follow through on his principles even when there was minimal political gain: In the wake of the murders of Nixzmary Brown and Marchella Pierce, he staged hearings but also spent months collaborating on ground-level improvements to the city’s child-welfare system. Bertha Lewis, the fiery housing advocate and a close friend of De Blasio’s, lauds him for holding bad landlords accountable. But De Blasio can also be elastic and opportunistic. He’s talked about the outer boroughs’ deserving the same quality of services as Manhattan, but this summer he landed large donations from the entrenched taxi-medallion owners—and sided with them against an outer-borough taxi-expansion plan. He’s been exceedingly patient on the delayed construction of subsidized housing at Atlantic Yards, a project that got key backing from his friend Lewis and whose developer, Bruce Ratner, co-hosted a birthday-party fund-raiser for De Blasio.
Forest City's promises

At a 11/29/04 public informational meeting held at City Tech in Downtown Brooklyn, then-Forest City point man Jim Stuckey was asked, "What plans are being made to have an independent compliance officer to oversee the project’s original plans and intentions?

His response: "The Community Benefits Agreement that we have in negotiations calls for an independent officer, probably more than one, that will be selected by an RFP."

Probably more than one. Stuckey even augmented the promise. Classic.

"They will work, as part of that, they will include DBAOC," Stuckey continued, referring to an existing group, "but they also will be, based on an RFP, an independent monitor will be selected, who will look at the Community Benefits Agreement, who will make judgements on whether the Community Benefits Agreement’s being followed by us and by the other participants  in the Community Benefits Agreement... the CBA and that monitor will have the right to issue reports and hold penalties that will be agreed to as part of the Community Benefits Agreement if we collectively and Forest City individually doesn’t do follow and do the things it basically said it would do."

Despite such promises, no monitor has been hired.

Sunday, October 27, 2013

As second season in Brooklyn begins, Nets seem to have the edge over Knicks; more BK food at arena

Thanks to a remarkable transformation of the roster over the summer, the Brooklyn Nets, in their second year, are widely seen to have the edge, at least in expected wins, over the long-established New York Knicks--though, of course, any sports season can have its wild cards, especially related to injuries.

The New York Times has a compilation, Pick a Side: Nets or Knicks? , with several contributors. Some excerpts below. There's even a video attached, titled "Nets' Turn to Be Talk of the Town."

Kenny Smith, an analyst for TNT’s N.B.A. broadcasts, wrote "Nets Now Have ‘New York’ Feel":
I think the conversation about pursuing excellence will be the same in both of these locker rooms. They both want to win. But from top to bottom, I’d have to say the Nets have the better roster. If the Nets don’t go to the N.B.A. finals, I think it will be a disappointment for them because they don’t have much of a window.

It’s different for the Knicks. Carmelo Anthony is still in his prime. They can retool after the season, especially if Carmelo stays and re-signs. The Nets don’t have that .
Times writer Beckley Mason wrote "Advantage, Brooklyn":
The Nets are old and might sacrifice a couple of victories in the regular season to guarantee their playoff health. But they have depth and will be able to spread the minutes around a team that is full of competent, savvy veterans. That is impressive when you consider some of the Nets who played substantial minutes last season.

By the playoffs, the Nets should be rounding into a physical, smart team that no one will be excited to meet in a seven-game series.
Bleacher Report columnist and former Times writer Howard Beck wrote "The Nets Fit Together":
 Unlike the Isiah Thomas-led Knicks of the mid-2000s, which were stocked with high-priced but ill-fitting stars, these Nets fit together. You might say the Nets stole the Knicks’ blueprint but simply did it better.

Having stolen the headlines and the Knicks’ thunder, the Nets are poised to steal the title as New York’s best basketball team. mes from 2004 to 2013.
Nets CEO Brett Yormark, as reported by NetsDaily, says the goal has risen from aiming to "be in the conversation":
"I think what Billy King did this summer was incredible and slowly we are becoming the conversation," said the Nets CEO. "There's a lot of anticipation for this team. We've got incredible star power. And I think the goal right now is to own New York and I think we're looking, hoping to do that."
More BK food vendors

Meanwhile, the Daily News reports, in Barclays Center upgrades Brooklyn Taste program to feature 55 Brooklyn-based vendors, that the arena has added 18 vendors:
The Chocolate Room is bringing their decadent chocolate brownies made with vanilla extract from Madagascar and 61% Belgian chocolate, as well as its signature three-layer chocolate cake with a blackout filling and chocolate frosting. “It’s sort of the McDonald’s French fry of The Chocolate Room,” says co-owner Jon Payson of the Park Slope cafĂ© treat which will now be the arena’s exclusive brownie.
Other sweet newcomers include Red Hook’s Steve’s Authentic Key Lime Pie served on Suite Level A and B, frozen yogurt shop Let’s YO! on Flatbush Ave. and Sugar Factory, slated to open in mid-December on the Sixth Ave. side of the arena.
Note that The Chocolate Room has also faced a huge rent increase blamed on the arena. Also, it's the first time we've gotten a firm date on the opening of the Sugar Factory, which has been promised since last fall. And the arena web site still lists 37 vendors.

The logical next step in EB-5: set up your own regional center, as in "Developers trade U.S. residency for China's cash"

Crain's reports Developers trade U.S. residency for China's cash, with the sub-heading "Silverstein Properties, The Related Cos. and others are among those setting up so-called regional centers to spin the promise of American residency into cash. Numbers of such operations are expected to double to 24 in just the next six months."

The headline itself is head-spinning, if you think about it. Why exactly should developers, or any other business, get cheap loans by offering green cards, which are public assets?

Only because of a loosely-written federal law that grants immigrant investors green cards for themselves and their families if they park $500,000 in a low-interest investment that creates--thanks to an economist's report--ten jobs.

However, if they're just substituting a low-interest loan for a typically higher-interest one, they're not creating jobs, they're creating more profits for the developer. Visas are public assets and, as I've written, it would make more sense for the U.S. government, as some other countries do, to simply require immigrant investors to park the money in government bonds, so at least the public is assured of some return.

The latest twist

The story begins:
Several major New York City developers are lining up to get permission from Washington to raise money through a government program that allows foreigners to become residents in the U.S. in exchange for investing in job-creating projects, including real estate development, here.
According to sources, Silverstein Properties and The Related Cos. are in the process of receiving approvals from U.S. Citizenship and Immigration Services to open their own so-called regional centers rather than using New York City- or state-sponsored centers to market their real estate projects to wealthy foreign investors.
Known as the EB-5 foreign investor program, it has been successfully used in several real estate projects in the city in recent years, such as the Gem Tower that was built by Extell Development and a large mixed-used development in downtown Brooklyn called City Point. The program allows developers to source cheap debt from foreign markets, especially China, which has a growing class of wealthy citizens eager to gain residency in the U.S.
EB-5 fundraising has been around for years, but a move by developers to create their own capacity to originate debt through the program opens the potential for its expansion experts say. Previously, developers had used third-party sources, like the New York City Regional Center, to handle EB-5 transactions.
Note that the New York City Regional Center, which was used by Forest City Ratner (always ahead of the curve) for the "Brooklyn Arena and Infrastructure Project," is not sponsored by any government. Most regional centers are private businesses, approved by the United States Citizen and Immigration Services (USCIS) but middlemen taking their cut.

Cutting out the middlemen

From the article:
"Once you have your own regional center, it can be easier to raise EB-5 funds for more projects," Mr. [Steven Polivy, the head of law firm Akerman Senterfitt's New York City real estate practice] said. The typical method has been for developers to raise money through the financing vehicle one project at a time through organizations like the NYC Regional Center.
The move will also allow the developers to save on the fees they would have to pay to third party regional centers and also set down their own deal terms, such as how much interest they are willing to pay foreign investors.
The numbers

From the article:
"Developers are getting senior construction financing from traditional sources like banks and then using EB-5 to supplement that," Mr. Polivy said. "Normally a mezzanine loan in today's market is about 15% but you can get the same capital from EB-5 and pay a 5% return."
The money quote 

Nearly two years ago, I pointed to a quote from Andrew Kimball, then director of the Brooklyn Navy Yard:
The Brooklyn Navy Yard got New York's first batch of EB-5 money.
“At first, we were sort of scratching our heads, thinking, is this real?” said Mr. Kimball. “The next thing we knew, we were falling out of our chairs.”
Why? Maybe because it's hard to fathom a program that "creates" jobs without having to actually count them, but instead relies on an economist's report.

Saturday, October 26, 2013

On Brian Lehrer: had "deeply flawed" Atlantic Yards procedure instead gone through ULURP, a greater discussion about directing subsidies (and maybe overall scope)

Yesterday's Brian Lehrer Show's election series "30 issues in 30 Days" addressed the question of to what extent should the city leverage private development to build affordable housing, parks, and open space:
Vicki Been, director of the Furman Center for Real Estate and Urban Policy at NYU, and Steven Spinola, president of the Real Estate Board of New York, discuss to what extent the city government should rely on private money for public amenities like affordable housing, more parks, and open space.
Lehrer started with Atlantic Yards, pointing out that Democratic mayoral nominee (and overwhelming favorite) Bill de Blasio supported the project because it promised good jobs and affordable housing. He asked de Blasio the day before if the failure to deliver housing by now meant that promise was meaningless. (I thought it was a weak question, and an obfuscatory answer.)

A larger cautionary tale?

"Do you agree it had the right goals or wrong implementation and oversight," as de Blasio indicated, "or is there some larger cautionary tale about how the public sector shouldn't rely on the private sector?" Lehrer asked.

Been said she agreed the procedure was "deeply flawed" because it used a Community Benefits Agreement that's not enforceable by the city, and enforcement takes a lot of time energy and money. (I'd add that there's an inherent conflict, because the signatories are also financially dependent on Forest City Ratner.)

She agreed the goals of the project, in the abstract, were absolutely appropriate, but had the process gone through the city's Uniform Land Use Review Procedure, "we would have much more discussion about how much subsidy should go into those affordable units."

In other words, once the project was approved, it essentially (though, actually, not completely) locked in support for subsidies, even though they might go farther elsewhere.

Been left out the issue of whether the ULURP process might have delivered a project with a different scope, density, and urban design.

What's industry's take?

Lehrer asked Spinola if the real estate industry even wanted "to be leveraged by politics to provide public goods"?

Spinola said "the private sector has greater ability to build things less expensively, and more quickly." However, "you can't ask for things economically that are not doable."

He moved on to some talking points, saying, "we are seeing the dramatic change as a result of the arena" and Forest City Ratner "is committed to doing everything they can," including developing modular housing and finding a new financial partner to meet its commitment.

But developers can say financial conditions have changed and can back off.

So too can the government, said Spinola, who added, "I'm not a big believer in Community Benefit Agreements.. I think they are not enforceable...I think that anything required has to be directly tied to the impact of the project. you cannot expect developers to do things unrelated to what they're building."

The profit motive and the quid pro quo

Lehrer pointed out that, at least with the public sector, the profit motive is not there/.

Been agreed that the public sector also faces risks, but with project like Atlantic Yards, "if the stadium gets built, but quid pro quo doesn't get delivered, it' a different breach of a bargain than when government has to cut back on plans for infrastructure."

She said she didn't disagree that Forest City isn't making efforts to build, and is innovating, but the "central issue is how do you make sure that benefits that developer sought and benefits that community sought both get done in a timely fashion."

And they left it like that.

Community comments

If you read the comments, there's a lot more skepticism. Peter Krashes from Prospect Heights
In 2006 and again in 2009 when the project agreements were modified, FCRC promised an arena, a specific number of new jobs, affordable housing, a new rail yard, and open space in exchange for roughly $300,000,000 in public subsidies, property control of 22 acres of land in the center of a revitalizing area, and even several public streets at a bargain rate. All of the subsidies and property control were based on the promise they would deliver the project in full in ten years.
FCRC made these promises knowing affordable housing subsidies weren't sufficient given construction costs, and they didn't explain how they were going to build the platform over a rail yard that is key to the project. It has been everyone's assumption FCRC was going to pursue additional subsidies or reduce costs, and if neither of those things happens, delay. But the promise that the project would be complete in ten years with the provided subsidies has been useful for the developer because it skewed government decision-making: How does government evaluate options if the information it is relying on is insufficient or incorrect?
So on what terms is FCRC going to deliver the project now? They have already said they are going to build using modular construction to lower construction costs, but modular construction delivers lower paying construction jobs (and potentially few construction jobs). They have effectively shifted the risk of lower construction costs to the public.
FCRC has also delayed constructing the promised permanent rail yard and changed the project's construction sequence to enable delaying or not building the platform over the rail yard -- therefore also delaying the removal of the blighting influence on the project site the project is ostensibly designed to eliminate. They apparently hope moving forward they can reduce costs of constructing a new rail yard and a platform. Who benefits if they succeed? Does the savings go to the project's investors, or to the public through more open space, improved affordable housing, or less density. Who makes that decision? And if the delay in building over the rail yard continues, then the de Blasio's family's back yard will be larger than the permanent open space the project provides its first several thousand families and pedestrians will be walking in circles.
Atlantic Yards oversight is recklessly thin. There is little government staff dedicated to the project exclusively, there is no independent board, and almost all information the public relies on about the project comes from FCRC about jobs, the delivery of benefits, and the extent environmental commitments have been met. FCRC has refused to hire the independent compliance monitor they promised for the project to verify their claims. Future Mayor de Blasio, please stop using FCRC's talking points and get us an effective independent compliance monitor and governance reform for the project now!
Michael D. D. White from Brooklyn Heights:
One of the most overlooked problems with so-called “public-private” partnerships (which those in the know frequently refer to more often as “private-public” partnerships because of the way the private sector tends to take over making government participants subservient) is beautifully addressed by one of Jane Jacobs most overlooked, least read books: “Systems of Survival.”
In that book Jacobs points out that attempts to mix business enterprises with government and politics are inherently flawed, because the moral systems that apply to each (each working well when confined to their own respective contexts) must necessarily remain different and incompatible. Jacobs’ book is full of examples of what happens when realms that should remain distinct (together with their associated moralities) improperly intermix, so that one gets what she calls “monstrous hybrids.” That includes, the Soviet Union running businesses, police departments for sale (“Robocop”?- How about prisons?), the Mafia, etc.
For more see: Wednesday, February 13, 2013One-Stop Petition Shopping: Report On The Brooklyn Heights Association Annual Meeting, LICH and Libraries.

Obama in Brooklyn: a Nets reference and an oculus welcome

North Flatbush BID
/Instagram via @vinniesstyles

The President was in Brooklyn yesterday, as TIME reported:
It was President Barack Obama’s 33rd trip as president to New York City Friday, according to CBS Radio Correspondent Mark Knoller, but just his first to the hipster borough, his former home. For Obama it was a homecoming. ”I know Brooklyn in general is blowing up right now,” Obama said when he took the stage at a high school there, noting he used to live across the street from Prospect Park.
Obama had arrived to visit the Pathways in Technology Early College High School in Crown Heights, a school surrounded by bearded Hasidic Jews and equally bearded hipsters, which he praised during his State of the Union address for its six-year program which gives students high school and associates degrees.
It’s a far cry from the usual crop of tony apartments and fancy restaurants the president has serially hit up for campaign cash.
Photo: AYInfoNYC
The Daily News reported:
"What I was living here, Brooklyn was cool, but not this cool," Obama said told delighted students at the Pathways in Technology Early College High School in Crown Heights.
The Times reported:
After his speech, Mr. Obama stopped at a Junior’s restaurant, on Flatbush Avenue, entering with Bill de Blasio, the Democratic nominee for mayor, and shaking hands with employees and patrons. “Do you know your next mayor here?” the president asked, before ordering two cheesecakes, one plain and one strawberry.
Photo via Darren Rovell/Twitter
According to Time, he even made a Nets reference:
Indeed, Barack Obama has rediscovered Brooklyn.The sports-fan-in-chief noted that the Brooklyn Nets, who play a few miles away, have acquired Paul Pierce and Kevin Garnett, adding it shows “old people can still play.”
And the Barclays Center was sure to welcome him, via the oculus.

Friday, October 25, 2013

On the radio, de Blasio repeats Ratner talking points on jobs, forgets promised compliance monitor (new video), promises push for affordable housing (subsidies?)

Appearing yesterday on WNYC's Brian Lehrer Show, Public Advocate Bill de Blasio, the Democratic nominee and overwhelming favorite for mayor, displayed his true colors on Atlantic Yards: obfuscate, repeat Forest City Ratner talking points, and, more ominously, leave hints he'd up subsidies to get the project done.

What's absent from de Blasio's public presentation is any distrust of the developer, despite ample reason for such distrust. For example, Forest City Ratner has long promised an Independent Compliance Monitor for the Community Benefits Agreement (CBA) de Blasio has championed.

No such monitor has been hired. de Blasio--who's supported by Forest City's housing partner and who's gotten campaign contributions thanks to Forest City--hasn't said a peep. Below I publish new video of Forest City's explicit promise.

On the radio

On Brian Lehrer, de Blasio was asked about about housing and transportation issues. His housing policies, de Blasio said, include mandatory inclusionary zoning, changes in the tax codes to open up vacant land, investing at least $1 billion in city pension funds.

Note that Atlantic Yards might be considered an example of a negotiated inclusionary private rezoning: in exchange for getting permission to build the project at the density it sought profitable, Forest City Ratner agreed to include 2250 subsidized housing units, among 6430 apartments.

At about 1:55 in the interview, Lehrer brought up AY: "You supported the Atlantic Yards project for its affordable housing promises, but now we have the gleaming Barclays Center, but no housing. Is the agreement with developer Bruce Ratner meaningless?"

That was kind of a dumb question. It's not meaningless, it's generous, as the state agency overseeing the project, gave Ratner a very long leash--and de Blasio did not use his bully pulpit to criticize that.

"No, it's not meaningless at all," de Blasio replied, then pivoted. "But I want to caution that... the goals were the right goals, the procedure was not the right procedure, it was not done with city of New York [oversight], because that was state land."

Actually, less than 40% of the project was state land, and city officials could have pushed for the project to go through the Uniform Land Use Review Procedure (ULURP).

And while de Blasio may think the goals of a large amount of housing were good, he should recognize that, in the "right procedure," one involving input from a City Council Member who reflected the concerns of her constituents, the plan might have been modified.

(Remember, people were not concerned merely about the arena, but the entire huge project, and none of those 16 towers have been built. We really can't grasp how it will look and what it's impact will be.)

Binding requirements

"The administrations governing at the time--the Bloomberg administration here, the Pataki administration in Albany, did not put the kind of binding requirements on the process that they could have, and this is the kind of tradition in the city I want to break," de Blasio said, unmindful of his silence on the agreement--binding but generous--already signed.

"We've had too many times where developers were offered very favorable, very lenient terms, a lot of affordable housing promises were not kept," he continued. "I intend a much more aggressive approach, with real consequences, if developers do not keep their commitments to the public. In the case of Atlantic Yards, I want to go back very aggressively and get that affordable housing built."

The thing is, de Blasio has zero power to open up the agreement with the state. He could use his buly pulpit to criticize--as he has failed to do--but more likely he will use the carrot, not the stick, and offer Forest City more subsidies to get the project done.

That would lead to results, but it would privilege this project over others. "As a physical location, it is a fantastic location for the creation of thousands of affordable units," de Blasio said, somehow ignoring that the project is also a "fantastic location" for thousands of market-rate units. "We have to take advantage of that and the city needs to play an active role to make that happen."

Lehrer did not ask how that might happen.

What Lehrer could have asked

As I wrote earlier this week, next time, rival candidate Joe Lhota or the moderator need to ask: How exactly have you pressured Ratner? What public statements or public criticisms have you issued? Did you say anything about the failure to provide the promised amount of family-sized apartments in the first tower? Did you say anything about the failure to hire an Independent Compliance Monitor for the Atlantic Yards Community Benefits Agreement?

Union-scale jobs

Lehrer related how he heard a Nets executive say he expects "every Nets game to sell out, maybe that's something you can use as leverage to get housing built, money is flowing in."

"Certainly, they're doing well," de Blasio said, and pivoted: "and by the way, there's another piece of this that's very important, they're employing a lot of Brooklyn residents, a lot of folks from areas of Brooklyn where there's fewer employment opportunities, and they're doing so at union scale. So, that is a crucial benefit, and another thing I care about a lot."

At union scale? There is a union at the arena, but Forest City won't say what the part-time workers are paid. Forest City claims a living wage, but won't say how many hours. It's a living wage only if they work a 40-hour week, and they don't.

No one can live on those "union scale" jobs. If de Blasio truly cared, he'd drill down, or he'd make sure Forest City hired that promised Independent Compliance Monitor to report honestly on the pay scale and hours of the workers, rather than repeat the developer's talking points.

Forest City's promises

I've written about this issue several times, but here's the best evidence: Former Forest City point man Jim Stuckey at a public meeting in November 2004.

"Let’s talk about Community Benefits Agreements," Stuckey said. "We doing something here that is historic. Never been done in New York City before. What we’re doing is we’ve agreed to enter into a legally-binding Community Benefits Agreement that will be monitored by an independent monitoring group not associated with anybody who actually negotiates that agreement."

Note the enthusiastic claps by supporters who thought that a validation of the company's plan.

Video by producers of Battle for Brooklyn.

"And we’re doing that because not only because we believe we should do the things that we say we will do, just as we have in the past"--not Stuckey's somewhat defensive tone--"and we also believe that should set the bar. We also believe that, what we do should be done by others.”

Ok, here's what happened. Forest City didn't hire that monitor, and when asked at public meetings has simply stonewalled, sometimes a bit nervously. Check out the response by executive Jane Marshall in the video below, at a November 2010 public meeting.

Video shot by Jonathan Barkey
Or the follow-up in November 2011 or February 2013.

"Are there plans or is is there a date on which you will hire an Independent Compliance Monitor?” Prospect Heights resident Gib Veconi asked last February.

" I don't have a date,” responded executive Ashley Cotton.

Not only has Forest City fallen down, so too have its Community Benefits Agreement partners, including those tied to de Blasio.

Remember how ACORN's Bertha Lewis in May 2006 defended the CBA by noting that it calls for an independent monitoring body that “does not have a dog in this fight” to oversee implementation.

Bruce Ratner, "Real Estate Visionary" on Morning Joe: 15 years ago, he drew the fate of Flatbush on a napkin

Bruce Ratner's victory laps have continued, with an appearance yesterday on Morning Joe on NBC.

It begins with clips of Ratner and his favorite front man at an empty press conference where Jay-Z announced the team would become, duh, the Brooklyn Nets.

"It was seven and a half years ago, Jay-Z, not too far from here, when we met for the first time," Ratner states. "We shared our dreams together and we got along, and he put his hand out, and I put my hand out, and we shook hands, and the rest is really history.

"I just appreciate all the support from Brooklyn, because without Brooklyn, I wouldn't be standing here right now," Jay-Z, in an apparent reference to the Westinghouse High School students behind him as props. "I'm humbled, I'm excited, so get ready for the Brooklyn Nets. Westinghouse, let's make some noise.

Then co-host Mika Brzezinski cooed over the Brooklyn Nets hat and t-shirt she was given, and Ratner declared her "an honorary citizen of Brooklyn." She followed by declaring her daughter a huge Jay-Z fan.

No questions, of course, about that little complicating fact of the Barclays Center being way behind financial projections.

Visit for breaking news, world news, and news about the economy

Adman Donny Deutsch commented, "I don't need to tell you, what a brilliant marketing move... to take that Jay-Z magic fairy dust and sprinkle it on top of the project instantaneously made the Nets cool, the project, of the people, stroke of genius."

"Made me a little cool too, and I needed a lot of that," Ratner replied in his self-deprecating way.

 Getting over resistance

While people were concerned about noise, traffic, and crime, Ratner said, "What's happened is none of that turned out to be the case. Most everybody takes subway or walks. There has been actually a lowered crime in the area, property values are up and of course most of all, there is a great venue for people to actually have their whole social life around. Whether you like Bocelli or the Nets or Jay-Z,, you've got all of us there. People have their whole social life around that arena."

 Um, no noise from concerts in people's apartments? No cars idling on neighborhood streets?

People have their whole social life around the arena?

The whole project

One of the panel asked "how close are you to the full vision, not just of the arena, but the whole development of the Atlantic Yards thing?"

"Well, the first thing to recognize, across the street, there is almost 800,000 square feet of retail that we built a number of years ago," Ratner replied, rather oddly. "The most important thing now is the housing. And we started the first building, we found ourselves a partner from China. And so it's going to go very quickly."

Or so they say. So far it's gone very slowly.

"And most importantly, we're going to build that project modularly, a new way to build high-rise construction, which I think will change construction. So it's a lot of good things happening."

The vision moment

Deutsch asked, "Give me the moment you were looking at the area where everyone else would have seen as just waste land and you saw the emerald city. It is such a creative, visionary type thing."

 (Just waste land where people were living and working? Or a valuable, if undeveloped and expensive to develop, piece of government property?)

"You know, it is some instinct, I think, and instinct is a bunch of experiences put together," Ratner replied. "I think it was almost a moment when I kind of looked and decided, this is the project. I saw..  a piece of land that had railroad tracks on it that could be built into something remarkable right in the hea--downtown area of Brooklyn."

(Note how he almost said "heart" but reverted to the "downtown" mantra.)

"I could just see it, honestly. In fact, 15 years ago, I remember I drew on a napkin what would happen to Flatbush Avenue 15 to 20 years from now, the amount of residential,, the amount of office, and so on," he continued. "I don't know what it is. It's just instinct."

Note that 15 years ago would be 1998, well before Borough President Marty Markowitz made his allegedly revelatory phone call about a basketball team up for sale. Though Ratner did not mention that his earlier revelation included an arena.

Or as cousin Chuck Ratner, then CEO of parent Forest City Enterprises on 9/9/05 told investment analysts, "I will confess that it was less than two or three years ago we were sitting around in New York wondering where the next deals were going to come from. We had finished a whole bunch of office and we completed MetroTech and we didn't have the next great site in Brooklyn. That was one of the reasons we got so aggressive and creative, Bruce and his team did in this Atlantic Yards project. We saw that land sitting there for this last 10 years, realizing it would be a great opportunity if somebody could turn it on."

More kudos

One on the panel saluted Ratner for building the Barclays Center, saying "it makes Madison Square Garden [which is being renovated] look shabby and kind of embarrassing. You go to barclays center and see the future of what a sports arena should look like. It's a modern sports arena, kind of like a nightclub/ sports arena, all in one."

Thursday, October 24, 2013

Veconi on Forest City's planned deal with Greenland to sell 70% of Atlantic Yards: scrutiny and oversight needed

Prospect Heights resident and BrooklynSpeaks leader Gib Veconi weighs in on the recent news--broken by the Wall Street Journal and, bizarrely, not followed up by the other dailies--that a Chinese government-owned company, Greenland Group, has signed a memorandum of understanding with Forest City Ratner Companies to buy 70% of the remaining 15-tower plan.

In Atlantic Yards, Pacific Investors: Will the Greenland deal really speed construction? Governor Cuomo better get it in writing., Veconi, writing in Prospect Heights Patch, questions some of the rhetoric:
And Forest City's press release quoted Mayor Michael Bloomberg as saying, "This investment would allow us to move forward with one of the most ambitious affordable housing programs in our City's history," as if any housing at the Atlantic Yards site was dependent upon the closing of the proposed transaction, instead of being an obligation of a deal signed four years ago between Forest City and the State of New York.
It is of course an obligation, but the deal might either move it ahead faster or allow it to proceed as agreed to with a (seemingly typical) renegotiation of terms.

Despite the posturing, Veconi points to previous promises unfulfilled, such as regarding the timing of the project and the promised office jobs (actually in four towers, not the one on-hold tower at the intersection of Flatbush and Atlantic avenues).

Veconi suggests that "one probable result of the Greenland transaction is that Forest City will be taking money out of Atlantic Yards before the project has delivered any of its promised public benefits," though the public will not have gotten a return on its subsidies.

Who's in charge?

He warns of future choppy waters:
Since Greenland would be on the hook to provide most of the future capital, it’s very likely it will also demand representation in decision-making about the schedule for future development as part of the final deal with Forest City. Maybe that’s why in its most recent 10-Q filed with the SEC, Forest City Enterprises disclosed its search for a joint venture partner at Atlantic Yards by stating, "if we are successful, it could result in forming joint ventures whereby we grant joint control or lose control of the asset."
And Greenland Holdings is owned by the government of China. While we may not find any problem with Chinese investment in New York City real estate, the idea that a foreign government could have a say on when affordable housing is made available to Brooklyn residents in danger of displacement is another question entirely. That possibility is particularly galling given the continuous calls for reform of Atlantic Yards oversight made by civic groups, affordable housing organizations and elected officials since the project’s approval in 2006. If it has been difficult for the public, its elected representatives, and the ESDC to get Forest City Ratner to deliver on its commitments, how much more influence can they expect in Beijing?
What next?

His bottom line: not only must ESDC finish the "study of development alternatives required by the court-ordered environmental impact statement," including the option of bidding out sites to other developers.

If does move forward with Greenland, new commitments regarding timing and oversight must be made in writing, with "terms worked out in conjunction with elected officials representing the communities surrounding the Atlantic Yards site."

That could be a major step up. After all, the Chinese government, despite the rhetoric in the initial press release, doesn't give a fig about affordable housing in Brooklyn. It's in this to make money, and has even fewer obligations to the public--or fear of future government pressure--than a local company.

The time for government pressure is before this deal closes, not after.

Here's the full column.