The looming, metal-clad arena, unmistakable at the intersection of Atlantic and Flatbush avenues, forming a new node just past long-accepted downtown boundaries, has been enough to convince some journalists, like a New York magazine sportswriter who willfully puts on blinders when it comes to the political implications of sports, that the “battle is over, and Bruce Ratner won it.”
That, however, depends on amnesia, or ignorance: a dismissal of the enormous claims of Atlantic Yards benefits, and belief in Ratner's assertion that “Nobody will remember what we had to do to make it happen.”
However much architecture critics and event-goers enjoy the arena, it cannot be seen in a vacuum, and the taint should not be ignored. Atlantic Yards, announced in December 2003, approved in December 2006 and again in September 2009, will be remembered, not just for its promises of 16 towers and arena, "Jobs, Housing, and Hoops," but also for "what we had to do."
Atlantic Yards and the Barclays Center have provoked neither indictments nor investigations. It's not a crime--despite the metaphorical use of the term by those who held protests on the opening weekend.
|After building on the arena block, the plan is to build on the southeast parking lot, bypassing the blighted railyard.|
That taint was reaffirmed in September 2013 when a state judge affirmed that the attorneys bringing that lawsuit were entitled to legal fees.
Even the most common--and, by many, quite welcomed--view of the arena is a dodge. People like the plaza in front of the arena as a place to gather and as a transition between the street and a large but not hugely tall building.
|Image via Curbed|
And Atlantic Yards likely would not have been approved without that office tower. That tower is on permanent hold.
Legal, but right?
There's no legal corruption. But Atlantic Yards relies upon what I'd call a "culture of cheating," a term inspired by The Cheating Culture: Why More Americans Are Doing Wrong to Get Ahead, a book by business ethicist David Callahan.
"I want to get it done," Mayor Mike Bloomberg told Ratner on the June 2003 day the developer unveiled the plan to the mayor. "Get it done no matter what."
It's an ends-justify-the-means shamelessness and betrayal of promises that pervades the project, involving, at various times, project promoters, consultants, lawyers, and community partners. And that cheating has been too often ignored or papered over by the press.
Interestingly, the New York Times, which has rarely scrutinized Atlantic Yards aggressively, in some ways endorsed this thesis, albeit buried in a long 9/27/12 profile of developer Bruce Ratner, describing "his reputation for promising anything to get a deal, only to renegotiate relentlessly for more favorable terms."
|Rendering by SHoP; not a photograph|
Yormark, it should be noted, was eager to proceed with the long-anticipated, nationally-televised home debut of the Brooklyn Nets Nov. 1, 2012, against the New York Knicks, despite the devastation to the city and transit system wrought by Superstorm Sandy.
"We also feel today this can be in many respects a rallying cry for New York," Yormark claimed. "We have to move on." ESPN scribe Ian O'Connor deemed the plan to hold the game "heartless" and "clueless." Facing reality, Mayor Mike Bloomberg finally nixed the game.
Consider how the Atlantic Yards arena was promised as a "community arena," with accommodation for local sports teams, school sports, and community events--and the Barclays Center's first year doesn't match up.
|The view looking west from Vanderbilt Avenue: unbuilt railyard, where development is delayed.|
Architect Frank Gehry, whose grasp of development politics appears (in retrospect) enormously shaky, described Bruce Ratner as"politically like me" and a fellow "liberal, do-gooder".
According to an interview in the Jewish Voice, "Ratner is a staunch Democrat and liberal and cannot
For Ratner, however, business considerations have always trumped ideology. In November 2010, Ratner wrote a check for $7500 to the New York State Senate Republican Campaign Committee, ensuring smooth relations with the party that controls the legislature's second chamber.
In a September 2012 Q&A, Yormark talked about the naming rights deal with a questionable company: " For me, what I'm most proud of is the cultural fit for Barclays." Similarly, Bruce Ratner praise his partnership with Mikhail Prokhorov, who got rich through connections: "We have the same kind of values and culture."
In both cases, Yormark and Ratner were talking about doing business deals, but the issue of "cultural fit" has broader, more ominous resonance.
Other reading on this theme
My Reuters Opinion essay, Brooklyn's vaunted, tainted Barclays Center.
Also see my essay from The Brooklyn Rail, A Brand Called Brooklyn, on the use of "Brooklyn" to sell the arena and team. Regarding the New York Times's erratic, inadequate coverage, see my City Journal assessment, The Barclays Center's Media Enabler (and more here).
This was a jaw-dropping fib from a 12/10/03 Forest City Ratner press release announcing the Atlantic Yards project: "The complex has been planned to look whole and complete during each phase of construction."
As I reported, buildings were to replace parking as the project proceeds. The construction schedule indicated much incompleteness, as did the map of buildings that would be finished year after year.
Even that schedule is in doubt by now, and the project by no means looks "whole and complete." There are empty spaces around the arena, to be filled by towers, and a surface parking lot waiting for towers.
A "civic developer"
"Our company is really what I call a civic development company," Ratner likes to say. "We do a lot of civic projects. And every project that we do has to have some civic component."
Except "civic" is a fuzzy term, and Ratner has made two self-sabotaging--if rather little-noticed--statements that back up charges of cheating:
- he repudiated the ten-year timeline to build the project previously endorsed by his company and the state
- he claimed that high-rise, union-built affordable housing isn't feasible, even though that's what he long planned and the state approved twice
Atlantic Yards was long promised to take ten years. Instead, after the project was re-approved in 2009, the state, via the Empire State Development Corporation (ESDC, or simply Empire State Development), negotiated contracts giving the developer up to 25 years. That Development Agreement was withheld when project opponents challenged the timetable in court.
First, a state judge ruled against the challengers, 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.”
Only later, after the challengers reopened the case, did the judge revise her decision and order a new review of the environmental impacts of a potential 25-year construction period.
Not only did the judge order a Supplemental Environmental Impact Statement, which was ongoing in 2013, in September 2013 she awarded legal fees to the attorneys representing Develop Don't Destroy Brooklyn and BrooklynSpeaks, the two winning coalitions. That was a discretionary decision, indicating that the state's defense was not tenable.
claimed that Atlantic Yards would have "job creation the likes of which Brooklyn has never seen."
Well, Brooklyn hasn't seen it, not the once-promised 15,000 construction jobs and certainly not the 10,000 permanent jobs. And much-hyped Jay-Z, whom savvy sportswriter David Roth called the Nets' "resident Brooklyn-credibility totem," gets to blather about how "it's already created so many jobs," and the press doesn't check.
Today, Bloomberg and Borough President Markowitz call the arena a job magnet--though nearly all the jobs are part-time and low-paying--and the numbers seem inflated.
The failure to deliver promised jobs provoked Umar Jordan, who spoke passionately for the project in an August 2006 public hearing and became a purported representative of the racial divide over Atlantic Yards, to more recently register his disgust.
Despite happy talk from arena reps about those 1900 part-time jobs and how the hourly wage is above "living wage," these are not living-wage jobs, since the definition depends on a 40-hour work week.
EB-5 job program
federal program, EB-5, that gives immigrant investors visas in exchange for purportedly job-creating investments.
Markowitz, unable to join Forest City Ratner on a fundraising trip to China, nevertheless taped hyperbolic praise for the project. asserting that Brooklyn was "1000 percent" behind Atlantic Yards--a preposterous claim--and asserting that Forest City's reputation was "unbelievably reliable."
Since then, he's changed his tune and been more candid, acknowledging that Atlantic Yards is "among the most contentious developments" in the country's history.
The inside track with the MTA
The key piece of public property is the 8.5-acre Vanderbilt Yard. Forest City Ratner not only had the inside track from the beginning, after it bid less cash than the one rival that emerged--$50 million vs. $150 million--the Metropolitan Transportation Authority in 2005 agreed to negotiate exclusively with Forest City. The developer then raised the cash bid to $100 million.
Then, in 2009, Forest City successfully re-negotiated the deal, getting the MTA to accept only $20 million down for the portion of the railyard needed for the arena, with 22 years to pay off the rest, at a gentle interest rate. It could build a smaller, cheaper railyard.
The deal survived a legal challenge, but the question lingers: did Forest City really have the MTA over a barrel, as the state contended? Instead, evidence suggests that the agency had leverage: it was Forest City that had to move the money-losing Nets from New Jersey, and faced an end-of-2009 deadline to have tax-exempt bonds issued.
Since 2009, Forest City has twice gotten the MTA to revise the contract, pushing forward the official start of the permanent railyard. That leaves questions about the promised schedule for that railyard and for the subsequent platform and the towers built over that platform.
Eminent domain and blight
The state exercised eminent domain for Atlantic Yards based on some rather suspect logic:
- Forest City Ratner drew the map of the 22-acre project site, with the oddly missing gap in the south-central block
- the Blight Study conducted by the ESDC concerned only the footprint of the project
- the consultant conducting the Blight Study was hired to conduct a "Blight Study in support of the proposed project"
- the consultant, AKRF, had always found blight as directed
- the consultant, though initially charged to do so, did not compare market conditions on the project site with conditions nearby (Prospect Heights was already a hot neighborhood, and even pro-Atlantic Yards legislator Roger Green said the area was not blighted)
- the criteria for blight, such a properties built out to less than 60% of allowable development rights, were arbitrary and never promulgated to warn property owners
- blight was not raised as an official justification when Atlantic Yards was announced
|June 2003 map|
The state Court of Appeals, with one exception, did not respond to plaintiffs' charges that Forest City drew the map. No wonder law professors from across the ideological spectrum now criticize that Court of Appeals decision.
"My personal view is the New York Court of Appeals basically abdicated any meaningful role for the judiciary in determining whether a blight designation even passed the laugh test," declared Rutgers Law Professor Ronald Chen at a February 2011 symposium.
From the majority opinion:
The land use improvement plan at issue is not directed at the wholesale eradication of slums, but rather at alleviating relatively mild conditions of urban blight principally attributable to a large and, of course, uninhabited subgrade rail cut.Only after the arena opened did Forest City Ratner reveal a plan to build four towers on the southeast block of the before constructing a platform for construction over the Vanderbilt Yard. That not only raised questions about whether the project would remove blight--the main justification for eminent domain--in a timely fashion, but also placed litigation over the railyard in a new light.
Accommodating government agencies
Empire State Development, the state agency overseeing/shepherding the arena, was wiling to allow the setbacks for the B4 tower--the largest likely to be built--to be moved closer to narrow Sixth Avenue. See graphic at right.
Is that a major change? Maybe, maybe not. But the agency gave the public one day notice that it was considering some kind of change, and did not reveal the content of that change unless people attended the ESDC board meeting--and those attendees did not get a look at the graphics for another hour, only when the agenda item came up.
Also, the New York City Economic Development Corporation was happy to tell the Daily News that the arena, in its first year, was a net gain for the city, but has so far refused to share its calculations or any documents regarding that conclusion.
A telling episode in the Atlantic Yards saga came in a 4/2/08 earnings conference call that parent Forest City Enterprises (FCE) held with investment analysis. Then-CEO Chuck Ratner expressed satisfaction in the developer’s relationship with local government, and said he expected more support.
At the time of the call, Forest City Ratner, FCE's New York subsidiary, had gained $105 million in city subsidies--quietly added after the project was approved--on top of the initially pledged $200 million from the city and state. (City officials now say total city subsidies are $179 million or $171.5 million, not $205 million.)
Since then, FCR gained (beyond other stated subsidies and tax breaks):
- a speed-up in delivery of pledged state and city subsidies
- an additional $31 million for land purchase (allegedly from infrastructure funds)
- a revised deal with the Metropolitan Transportation Authority for the Vanderbilt Yard, with only $20 million down (instead of $100 million), a smaller permanent yard, and a generous 6.5% interest rate to pay back the remaining $80 million
- a Development Agreement with gentle penalties and generous deadlines (12 years for Phase 1, 25 years for Phase 2)
“Forest City does not expect to ask for more subsidy,” Executive VP MaryAnne Gilmartin responded carefully. But of course it did, requesting $10 million more in housing subsidies.
Also, another representative of the developer unsuccessfully sought $9 million in state support to rebuild the Carlton Avenue Bridge.
The New York City Independent Budget Office called the arena a net loss to the city even without calculating the housing subsidies or the value of naming rights that the state gave away.
But even before the economy turned, the developer was lying, for example claiming (as in the screenshot at right) that 50% of all affordable apartments would be devoted to two- and three-bedroom units rather than, as promised in the Affordable Housing Memorandum of Understanding, 50% of the floor area.
Later, Forest City stopped mentioning that pledge and instead claimed that the goal was that 20% of the units would have two bedrooms.
It took a Freedom of Information Law (FOIL) request for me learn the full back story, in which the only reason the developer got to 20% was a push from the New York City Housing Development Corporation, and the agency acceded, mostly, to Forest City's counterproposal that the additional units be rented not to the families who loudly rallied for the project but households earning six figures.
That story is summarized in an 8/26/12 article for City Limits' Brooklyn Bureau, Agency, Developer Wrestle Over Atlantic Yards Affordability.
The arena liquor license
The arena operators made a joint presentation in April 2012 to Community Boards 2 and 6, claiming that alcohol sales would be cut off by the end of the third quarter for NBA games and before the end of concerts.
They failed to disclose a plan to serve 1,800 VIP patrons for one hour after events, up to 2 am. When the State Liquor Authority rolled that back to 1 am, a small victory for neighbors, the press missed arena operators' initial resistance to the change.
Barclays, LIBOR, and the roof logo
If Atlantic Yards represents the "culture of cheating," then isn't naming rights partner Barclays a perfect fit? Barclays is an admitted cheater, paying $450 million to settle charges of interest rate manipulation.
The executive who negotiated the naming rights agreement, Bob Diamond, resigned in disgrace.
And, as I've reported, there was never any explicit permission to put the Barclays Center name/logo on the arena roof because, when the Atlantic Yards Design Guidelines were approved, there was supposed to be a green roof. Nor were the plans ever explicitly explained.
It's not a violation, but it sure looks like cheating.
Similarly, it should not be surprising that Forest City is willing to make a deal with Chinese government-owned Greenland Group to buy up to 70% of the project.
Barclays Center developer Ratner, appearing 9/11/12 on Bloomberg Television's "Surveillance," managed to smoothly rewrite the history of Forest City Ratner's (FCR) noncompliance with construction protocols (noise, dust, traffic) and the state's failure to stop such violations.
The failure goes back to the December 2009 Memorandum of Environmental Commitments (MEC) that FCR negotiated with Empire State Development, the state agency that has the dicey duty of both overseeing and promoting Atlantic Yards. The MEC was supposed to bind Forest City to construction practices that protected the neighborhood.
In fact, according to documents I viewed via a Freedom of Information Law request, the state at one point sought a $10,000 daily penalty for violations of the MEC. Forest City opposed the penalty. The developer prevailed. And, despite Ratner's claims, there have been numerous violations of protocols designed to tamp down dust, noise, and traffic.
|Dean Street between Flatbush and Sixth avenues, Sept. 12|
Atlantic Yards Watch recently reported, with copious photos and video, on ever more violations of construction protocols, as trucks get jammed on residential Dean Street or make a wrong-way turn from Sixth Avenue to reach the tight setting of the loading dock.
Not only has ESD neglected oversight, documents suggest the agency and its environmental monitor have condoned a cover-up of a Forest City contractor's falsification.
The Times on Jan. 1, 2013 reported how the arena opened despite more than 1700 defective bolts, a problem not fully disclosed to the Department of Buildings and--as I described--obfuscated in reports from the state agency overseeing the arena as well as the construction monitor for the bond trustee.
There has not been the "Carmageddon" that people feared, thanks in part to the availability of and heavy promotion of public transit.
However, the arena does not function without significant use of public resources--and the willingness to overlook some localized but significant impacts. Traffic agents have overridden red lights on Flatbush Avenue to advance traffic and police have shut down Atlantic Avenue so crowds can cross in the middle of the street.
More importantly, and consonant with the construction violations, police have so far tolerated honking, idling limos and livery cabs on adjacent residential streets, including those in No Parking/No Standing zones.
And the loading dock has not operated, as a city official claims, "seamlessly," but instead has left many trucks waiting or idling on residential streets, as steadily documented on Atlantic Yards Watch.
An arena rep claimed the August 2013 MTV Video Music Awards event was a huge success, but some neighbors disagreed severely.
With the initial concerts by Jay-Z, and later concert EDM (electronic dance music) shows 10/26/12 and 10/27/12 called Sensation, pounding bass has penetrated the residences of neighbors on nearby blocks.
The response from the city was to send an inspector to measure noise--according to a neighbor--before the Jay-Z concert started. The community affairs representatives of Empire State Development (ESD) and the Barclays Center didn't respond to queries after the first Sensation show.
But Arana Hankin, director, Atlantic Yards Project, ESD, did appear on a video for Sensation effusively suggesting, "I can only imagine people will love to have Sensation in their backyards."
They didn't--and while a proposed fine against the arena for Sensation was dismissed on a technicality, the city levied a $3200 fine--pocket change, really--against the arena for noise violations during a Swedish House Mafia show.
Those $15 Nets tickets
The arena and team promoters have made a bit deal out of the promised 2,000 affordable $15 tickets to Brooklyn Nets games. But those tickets were very elusive.
Some apparently were put up for sale for season tickets. Relatively few were available for before-game purchase--perhaps a few hundred. However, Nets ticket reps, in online chats, misleadingly told potential buyers that not only were there no $15 seats available as season tickets, they would not be available for individual sale.
For the second season, there will be no $15 tickets. The base price is $25.
The Community Benefits Agreement
Even the New York Times, which once saluted Forest City Ratner for developing a "modern blueprint" regarding how to harvest local support, acknowledged that the Community Benefits Agreement (CBA) is inherently conflicted. But the picture is far more troubling.
Take, for example, the chair of the CBA coalition: Delia Hunley-Adossa. Her organization, the obliquely named Brooklyn Endeavor Experience, is ostensibly supposed to monitor local environmental impacts. It has mainly a Potemkin responsibility, and has done and said nothing regarding continued violations of construction protocols. Instead, she's more of a cheerleader.
A long article in Next City concluded, "Seven years after the Brooklyn document was signed, five of the groups have been mostly silent or reconstituted after without much fanfare." And even that article was way too gentle.
The Independent Compliance Monitor
After signing the much-promoted CBA in June 2005, as shown in the film Battle for Brooklyn, Bruce Ratner claimed that, if there was any failure in compliance, there could be litigation. Mayor Mike Bloomberg intervened: “You have Bruce Ratner’s word. That should be enough for you and everybody else in the community."
The CBA was supposed to require an Independent Compliance Monitor (ICM). In a March 2007 press release, Bruce Ratner stated:
“Atlantic Yards is setting a new standard for inclusion and community involvement for a development, and the ICM will be everyone’s watchdog to ensure we reach all of the goals and benefits we have agreed to in the CBA."They've never hired an ICM, and thus saved the $100,000 a year once supposed to be set aside for that role.
Jacobs vs. Moses
According to a 5/2/13 New York Observer article, MaryAnne Gilmartin, Forest City's new CEO "also expressed her admiration for Jane Jacobs, praising her focus on mixed-use development and declaring that: 'It may surprise some given my developer DNA, that I identify more with Jane Jacobs than Robert Moses.'”
It may surprise some, indeed. As architecture critic Paul Goldberger has suggested, "So if there is any way to follow Jane Jacobs, it is to think of her as showing us not a physical model for city form but rather a perceptual model for skepticism."
There's ample reason to be skeptical of Gilmartin and of Forest City, and not just because of Atlantic Yards. The Culture of Cheating extends throughout other corporate behavior.
The Yonkers trial
Forest City Ratner's Ridge Hill retail/office development in Yonkers was the subject of a federal corruption trial that ended in March 2012 with the conviction of the City Council Member who flipped her vote to endorse the project and the fixer who had been providing corrupt payments to her all along--and just happened to ask Forest City Ratner for a job as the negotiations proceeded.
Had the public known that Jereis had been giving Annabi hundreds of thousands of dollars over the course of several years, that Jereis and Annabi had a meeting with the Ridge Hill developers before the vote, and that Forest City Ratner promised Jereis a $60,000 no-show consulting contract if Annabi flipped her vote from no to yes, there would very likely have been a clamor for Annabi to be recused from the July 11, 2006 vote on the Ridge Hill Project... The largest development project in the history of New York's fourth largest city might never have been built. Or the developer might have had to make significant concessions.As the trial proceeded, Crain’s New York Business columnist Greg David, generally a friend to developers, commented that Forest City Ratner must be relieved that its “See no evil, hear no evil” posture in Yonkers got so little attention. Yet the state agency overseeing Atlantic Yards nevertheless claimed that it was confident that Forest City remained a "good corporate citizen."