Skip to main content

Looking at Forest City's state lobbying: Atlantic Yards governance, ticket regulations, eminent domain

According to the latest state lobbying report, Forest City Ratner's Atlantic Yards Development Company spent $490,000 on city and state lobbying in 2013, with the state totaling $203,000, the city $287,000. (I reported on the city total in March.) The list:
LoCicero & Tan $48,000 ($16,000 state, $32,000 in city)
Geto & DeMilly, $46,000 (all in city)
Kasirer Consulting, $240,000 ($80,000 state, $160,000 in city)
Park Strategies, $60,000 ($20,000 state, $40,000 in city)
State & Broadway, $60,000 (all state)
Wilson Elser Moskowitz Edelman & Dicker $36,000 ($27,000 state, $9,000 in city)
In 2012, Forest City spent $448,000 on city lobbying, plus another $104,000 on state lobbying (the latter number may be fuzzy, since state figures are a little tough to read), for a total of at least $552,000.

 In 2011, the AYDC spent $503,000 in total, while Forest City itself spent $15,000 on an outside lobbyist. In 2010, Forest City spent about $345,000 on lobbying, down from the the 2009 total of $1,127,598 in city and state lobbying, perhaps the largest sum for any real estate developer. Well, 2009 was a very big year.

Note that the totals do not include federal lobbying.

The issues lobbied, and the connections at the top

Some state issues lobbied were quite general, including budget, and aid to localities. Others quite specifically would impact the operation of the Barclays Center and other Forest City/Atlantic Yards operations. Several addressed ticketing or construction issues.

To a great extent, Forest City's key lobbying starts and ends with one man, Assembly Speaker Sheldon Silver, who controls all legislation and remains a key ally. So some bills might make some noise, but they're not serious threats until Silver gives his blessing.

And if for some reason a bill passed the legislature, another ally, Gov. Andrew Cuomo, remains a potential roadblock.

Atlantic Yards topics

Assembly Bill A5334, sponsored by Assemblyman Walter Mosley (who inherited it from his predecessor, Hakeem Jeffries), would authorize the Urban Development Corporation (aka Empire State Development, to create a "subsidiary corporation for the purpose of the further planning, design, and oversight of the Atlantic Yards land use improvement and civic project."

It has five co-sponsors and remains stalled in committee, likely due to Silver.

The bill, the concept of which Mosley endorsed at the recent hearing on the Draft Supplementary Environmental Impact Statement, aims "to supervise the Atlantic Yards Project in order to create increased accountability and oversight in the project's governance." The statement:
...unique among the large state projects in New York City, there is no project subsidiary for Atlantic Yards. The result is that the project is governed in a less transparent, less accountable manner than comparable projects, and without any vehicle for coordinating the city and state agencies involved in the proposed development, or involving local elected officials and the relevant community boards. Further, changes in administration in State government, as well as-changes in the ESDC's internal organization, pose risks to the continuity of project oversight which may threaten the realization of Atlantic Yards' stated goals.
To address this, the proposed legislation would establish a subsidiary corporation for the oversight of the Atlantic Yards project. The entity would be created to undertake four primary responsibilities.
First, oversee the implementation of the design guidelines for the architecture of the project. Second, coordinate the involvement of state and city agencies responsible for the environmental impact mitigations. Third, coordinate the development of policy surrounding the project, including transportation concerns. Lastly, approve changes to the general project plan.
The rather stale Assembly Bill A5379, sponsored by Assemblyman Jim Brennan and with Assemblymember Joan Millman as the only cosponsor, would set Atlantic Yards as no greater than 5.6 million square feet, a more than one-third reduction in size, while providing between $12.6 million and $15.4 million per year for 30 years for 2200 units of affordable housing and giving the developer the railyard for free (thus saving another $80 million, plus interest).

Also stale is Assembly Bill A5189 which has six sponsors, would require that Atlantic Yards be subject to ULURP, but hasn't gotten anywhere.

Other bills: tickets

Assembly Bill A797, which hasn't gotten out of committee, would prohibit the operator of any place of entertainment (that is not municipally owned) which has a seating capacity of over 3,500 from accepting a rebate on tickets sold. According to the bill, ticket agents often charge consumers a service charge on top of a ticket's face value, then kick back a portion of that charge the the venue.

Assembly Bill A5810 would clarify the term "obstructed view" in ticket sales and would require the consumer protection division of the department of state to report on effectiveness of the regulation of such sales. It's still in committee.

Assembly Bill A7209, which has 15 sponsors but is still in committee, would require the number of tickets at each price tier to be disclosed by primary market operators, given that "Far too often tickets to New Yorkers' favorite concerts, sports games, and other entertainment events have 'sold out' within seconds of the time they are put up for public sale."

Assembly Bill A6415, which passed last year extends some ticket laws through this past May 14, allowing legislators more time to study the issue.

Other bills: construction/financing

Assembly Bill A1688, still in committee, would require contractors in cities having a population of one million or more to recycle 50% of the waste generated on construction and demolition sites.

Assembly Bill A5159 would enact the New York City Department of Buildings Community Accountability Act, citing the need for greater enforcement and auditing. Sponsored by Brennan, it has 17 co-sponsors, but remains in committee.

Assembly Bill A5250 would require NYC to establish a "contractors license board." It's still in committee.

Senate Bill S2102, which has 13 sponsors, would ensure that new construction would have to be completed in three years to get a 421-a tax break.

Assembly Bill A5402 would require approval of the governing body of a city prior to the approval of payments in lieu of taxes for the repayment of debt, thus taking it out of a mayor's hands. It's sponsored by Brennan but hasn't gotten anywhere.

Other bills: eminent domain

Assembly Bill A3973, still in committee, would reform eminent domain by requiring municipal approval of the exercise of eminent domain and the preparation of a comprehensive economic development plan when the primary purpose is economic development and certain residential premises are to be acquired.

(This bill, which has no cosponsors, would respond to the Supreme Court's Kelo decision. Note that for Atlantic Yards, the justification for eminent domain was blight removal.)

Senate Bill S3517, which has three sponsors, would create a temporary commission on eminent domain. It's still in committee.


Popular posts from this blog

Forest City acknowledges unspecified delays in Pacific Park, cites $300 million "impairment" in project value; what about affordable housing pledge?

Updated Monday Nov. 7 am: Note follow-up coverage of stock price drop and investor conference call and pending questions.

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:
if market-rate construction is delayed, will the affordable h…

Revising official figures, new report reveals Nets averaged just 11,622 home fans last season, Islanders drew 11,200 (and have option to leave in 2018)

The Brooklyn Nets drew an average of only 11,622 fans per home game in their most recent (and lousy) season, more than 23% below the announced official attendance figure, and little more than 65% of the Barclays Center's capacity.

The New York Islanders also drew some 19.4% below announced attendance, or 11,200 fans per home game.

The surprising numbers were disclosed in a consultant's report attached to the Preliminary Official Statement for the refinancing of some $462 million in tax-exempt bonds for the Barclays Center (plus another $20 million in taxable bonds). The refinancing should lower costs to Mikhail Prokhorov, owner of the arena operating company, by and average of $3.4 million a year through 2044 in paying off arena construction.

According to official figures, the Brooklyn Nets attendance averaged 17,187 in the debut season, 2012-13, 17,251 in 2013-14, 17,037 in 2014-15, and 15,125 in the most recent season, 2015-16. For hoops, the arena holds 17,732.

But official…

At 550 Vanderbilt, big chunk of apartments pitched to Chinese buyers as "international units"

One key to sales at the 550 Vanderbilt condo is the connection to China, thanks to Shanghai-based developer Greenland Holdings.

It's the parent of Greenland USA, which as part of Greenland Forest City Partners owns 70% of Pacific Park (except 461 Dean and the arena).

And sales in China may help explain how the developer was able to claim early momentum.
"Since 550 Vanderbilt launched pre-sales in June [2015], more than 80 residences have gone into contract, representing over 30% of the building’s 278 total residences," the developer said in a 9/25/15 press release announcing the opening of a sales gallery in Brooklyn. "The strong response from the marketplace indicates the high level of demand for well-designed new luxury homes in Brooklyn..."

Maybe. Or maybe it just meant a decent initial pipeline to Chinese buyers.

As lawyer Jay Neveloff, who represents Forest City, told the Real Deal in 2015, a project involving a Chinese firm "creates a huge market for…

Is Barclays Center dumping the Islanders, or are they renegotiating? Evidence varies (bond doc, cash receipts); NHL attendance biggest variable

The Internet has been abuzz since Bloomberg's Scott Soshnick reported 1/30/17, using an overly conclusory headline, that Brooklyn’s Barclays Center Is Dumping the Islanders.

That would end an unusual arrangement in which the arena agrees to pay the team a fixed sum (minus certain expenses), in exchange for keeping tickets, suite, and sponsorship revenue.

The arena would earn more without the hockey team, according to Bloomberg, which cited “a financial projection shared with potential investors showed the Islanders won’t contribute any revenue after the 2018-19 season--a clear signal that the team won’t play there, the people said."

That "signal," however, is hardly definitive, as are the media leaks about a prospective new arena in Queens, as shown in the screenshot below from Newsday. Both sides are surely pushing for advantage, if not bluffing.

Consider: the arena and the Islanders can't even formally begin their opt-out talks until after this season. The disc…

Skanska says it "expected to assemble a properly designed modular building, not engage in an iterative R&D experiment"

On 12/10/16, I noted that FastCo.Design's Prefab's Moment of Reckoning article dialed back the gush on the 461 Dean modular tower compared to the publication's previous coverage.

Still, I noted that the article relied on developer Forest City Ratner and architect SHoP to put the best possible spin on what was clearly a failure. From the article: At the project's outset, it took the factory (managed by Skanska at the time) two to three weeks to build a module. By the end, under FCRC's management, the builders cut that down to six days. "The project took a little longer than expected and cost a little bit more than expected because we started the project with the wrong contractor," [Forest City's Adam] Greene says.Skanska jabs back
Well, Forest City's estranged partner Skanska later weighed in--not sure whether they weren't asked or just missed a deadline--and their article was updated 12/13/16. Here's Skanska's statement, which shows th…

Not just logistics: bypassing Brooklyn for DNC 2016 also saved on optics (role of Russian oligarch, Shanghai government)

Surely the logistical challenges of holding a national presidential nominating convention in Brooklyn were the main (and stated) reasons for the Democratic National Committee's choice of Philadelphia.

And, as I wrote in NY Slant, the huge security cordon in Philadelphia would have been impossible in Brooklyn.

But consider also the optics. As I wrote in my 1/21/15 op-ed in the Times arguing that the choice of Brooklyn was a bad idea:
The arena also raises ethically sticky questions for the Democrats. While the Barclays Center is owned primarily by Forest City Ratner, 45 percent of it is owned by the Russian billionaire Mikhail D. Prokhorov (who also owns 80 percent of the Brooklyn Nets). Mr. Prokhorov has a necessarily cordial relationship with Russia’s president, Vladimir V. Putin — though he has been critical of Mr. Putin in the past, last year, at the Russian president’s request, he tried to transfer ownership of the Nets to one of his Moscow-based companies. An oligarch-owned a…