Skip to main content

Signs hint at money crunch for Atlantic Yards opponent DDDB, but reps say they're confident about fundraising

We know that the Goliath in the Atlantic Yards fight (Forest City Enterprises/Forest City Ratner) is hurting, as the parent company's stock price tumbles, analysts say it is worthless, the Beekman Tower seemingly stalls, and choice properties are put on the block to raise cash.

But what about David?

While Develop Don’t Destroy Brooklyn (DDDB) has not expressed public concern about its financial situation, a recently released Internal Revenue Service (IRS) document shows that the organization, in the year ending last June, spent nearly $118,000 more than it took in, cutting deeply into its reserves, leaving net assets of $20,757.

(Click on graphics to enlarge)

That raises questions about DDDB's capacity to maintain legal challenges as Forest City, bolstered by a new loan from the National Basketball Association for the Nets, limps ahead, renegotiating with unions at Beekman, and with more of a commitment to Atlantic Yards--the arena, at least--than nearly anything else in its portfolio. After all, a new arena would mean an end to losses from the Nets and an immediate increase in the value of the team.

But two DDDB representatives expressed confidence in current fundraising, noting that litigation expenses were much greater then than now.

Comparing sums

DDDB raised some $860,000 over three years (and more since last June 30), from more than 4000 donors, with a median (though not an average) donation of $50. That's significant support for a grassroots organization that has not raised money from foundations or one significant donor. (For example, West Harlem business owner Nick Sprayregen, fighting Columbia University's expansion plan, estimates he'll spend $2 million on legal fees.)

DDDB's fundraising, however, is dwarfed by the resources of the government and developer Forest City Ratner, which spent more than $900,000 on lobbying just last year, and additional sums on legal and public relations expenses.

As of June 2006, Forest City Ratner had distributed $538,000 to Community Benefits Agreements (CBA) signatories and, while there's been no public accounting of its donations--City Council candidate Delia Hunley-Adossa of Brooklyn Endeavor Experience (BEE) wouldn't say how much the developer has given--the sum is surely much higher.

And Forest City Ratner recently bailed out ACORN, the national organization whose local affiliate is a CBA signatory, with $1.5 million in grants and loans.

Tougher fundraising environment

Whatever the size of DDDB's current coffers, fundraising is undoubtedly more challenging than it’s been in the past few years, given the economy and the mistaken but not uncommon belief--for example, see the recent New York magazine timeline--that the Atlantic Yards fight is over.

That could mean difficulty in paying lawyers for legal battles--though volunteers might step up. And it could mean at least a diminishment, though likely not an end, to DDDB’s presence.

While DDDB includes a coalition of 21 community organizations and has been able to call on 800 volunteers and a 20-person volunteer legal team, the number of core contributors is relatively small.

That core is exemplified by the ubiquitous Daniel Goldstein, who’s now paid a modest consultant's fee to work 60 hours a week (his tally) as webmaster, organizer, graphic designer (see latest, at right), and media presence, recently finding much traction with the AIG/Barclays story.

(War historian, not so much; Goldstein says he misspoke.)

Goldstein was ranked #10 last year in Brownstoner's list of the 50 most powerful people in Brooklyn real estate. Crain's editorial director Greg David has said "opponents of... Atlantic Yards have conducted one of the most imaginative campaigns against it that I've ever seen."

DDDB confidence

"Despite a tough economy for everyone, we continue to raise funds throughout the year, and feel that our fundraising plans will allow us to move forward with all existing and planned litigation," said Goldstein in response to my query. (He's also the lead plaintiff in the pending eminent domain case.)

The organization raised $45,000 last October from its fourth annual Walk Don’t Destroy Walkathon, but no other major gifts have been announced. Regular DDDB mailings solicit funds and periodic house parties raise money.

"We have a good fundraising plan in place and I am confident that we can fund all current and planned litigation," commented Eric Reschke, the group's executive director. "We've been here for five years, and I expect the next five... if necessary."

Appeals supported

Goldstein said the organization has sufficient funding to pursue the appeal of the dismissal of the case challenging the project’s environmental review, as well as an appeal in the state case challenging the use of eminent domain, in which a decision is awaited.

In the first case, the appeal is discretionary, meaning that the lawyers must gain permission; in the second case, the appeal also would be discretionary unless the decision was split (and I believe that’s unlikely).

Other lawsuits?

Would there be other lawsuits after that? Unclear, but DDDB last June asked the Public Authorities Control Board (PACB) to reconsider its approval of the project, given that the project had changed so much.

The PACB has not done so and, arguably, some formal complaint could be filed. A lawyer representing a group of plaintiffs in a case not organized by DDDB has asked that the Empire State Development Corporation be required to hold a new hearing, given project changes.

Looking at the filings: 2006

DDDB has made three extant IRS Form 990 filings, available here. The next filing, covering the year ending June 30, is not due until November.

In the 2005 business year, which ran from 7/1/05 to 6/30/06, DDDB raised $199,454 in direct public support, spent $102,599 in program services and $33,386 in fundraising, and had $55,072 left over.

The $136,177 in expenses included $98,512 in legal fees, with the largest part, $61,553, going to the Albany law firm Young, Sommer, Ward, Ritzenberg, Baker & Moore, for the case challenging the project's environmental review.

The main paid consultant was Shabnam Merchant, one of the three trustees, was paid $33,000, without benefits, to work on fundraising, volunteer coordination, and community outreach. (Merchant and Goldstein, who met during the AY fight, were married nearly four years after it began, in 2007.)

Among the DDDB program services listed in the Form 990: held community forums, organized rallies, developed outreach programs, assisted/solicited other bids and plans, filed lawsuits, identified and recruited an advisory board, organized tenants, made presentations, and waged a media campaign.

Looking at the filings: 2007

In the 2006 business year, which ran from 7/1/06 to 6/30/07, DDDB raised significantly more money, likely because it recruited a high-profile advisory board announced 5/8/06 and because Atlantic Yards received significant public attention, given the enviromental review process, official approval of the project, and first round of lawsuits.

DDDB raised $366,065 in direct public support, and spent $283,181 on functional expenses, including $221,422 on program services and $52,700 in fundraising. Merchant received a total of $40,500.

DDDB spent $189,694 in legal fees, including $77,634 to Young, Sommer and $101,286 to Emery, Celli, Brinckerhoff & Abady, the New York City firm handling eminent domain litigation.

It had $138,054 in net assets left over.

Looking at the filings: 2008

In the 2007 business year, which ran 7/1/07 to 6/30/08, DDDB raised $293,952 in direct public support and spent $411,764 on functional expenses, including $385,094 on program services and $21,963 on fundraising. That meant a deficit of $117,297 for the year, and less than $21,000 left over.

The organization spent $353,562 in legal fees, including $192,693 to Emery, Celli and 126,386 to Young, Sommer.

A family and an organization

It also spent $33,750 in consultant fees to Merchant. After she had a baby, she stopped working for the organization (though she still volunteers).

Goldstein, who had volunteered his time and lived off savings, last July became a paid consultant, without benefits, working out of his condo in a footprint building otherwise owned by Forest City Ratner. Payments to him have not yet been reported, but he told me they're consistent with previous consultant payments.

In an interview March 15 with the Daily News's Mike Lupica, Goldstein indicated that he "doesn't know how long he can stay at this."

I asked him to elaborate. "I was talking about my growing family's personal hardships," he said, adding that his home is not for sale.

DDDB has raised a significant amount of money with volunteers and relatively low-paid consultants. For example, Hunley-Adossa's $51,447 compensation at BEE, a job for which she has had little public presence (other than running rallies for Forest City Ratner), is larger than the annual sum DDDB has spent on consultants--and BEE, in contrast to DDDB, has spent little on program services.

Atlantic Yards is not a one-person fight, as Nets CEO Brett Yormark recently contended. Still, the role of Goldstein, not just as a worker but a symbol in the eminent domain fight--a fight that may be over within the year--raises some questions: how much is the organization reliant on a few key people, and what happens if and when they can't do as much?


Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

No, security guards can't ban photos. Questions remain about visibility of ID/sticker system.

The bi-monthly Atlantic Yards/Pacific Park Community Update meeting June 14, held at 55 Hanson Place, addressed multiple issues, including delays in the project, a new detente with project neighbors,concerns about traffic congestion, upcoming sewer work and demolitions, and an explanation of how high winds caused debris to fly off the under-construction 38 Sixth Avenue building. I'll have more coverage.
Security issues came up several times at the meeting.
Wayne Bailey, a resident who regularly takes photos and videos (that I often use) of construction/operations issues that impact residents, asked representatives of Tishman Construction if the security guard at the sites they're building works for them.
After Tishman Senior VP Eric Reid said yes, Bailey asked why a guard told him not to shoot video of the site, even though he was on a public street.

"I will address it with principals for that security firm," Reid said.
Forest City Ratner executive Ashley Cotton, the …

Barclays Center event June 11 to protest plans to expand Israeli draft; questions about logistics

At right is a photo of a poster spotted in Hasidic Williamsburg right. Clearly there's an event scheduled at the Barclays Center aimed at the Haredi Jewish community (strict Orthodox Jews who reject secular culture), but the lack of English text makes it cryptic.

The website explains, Protest Against Israeli Draft of Bnei Yeshiva Rescheduled for Barclays Center:
A large asifa to protest the drafting of bnei yeshiva in Eretz Yisroel into the Israeli army that had been set to take place this month will instead be held on Sunday, 17 Sivan/June 11, at the Barclays Center in Downtown Brooklyn, NY. So attendees at a big gathering will protest an apparent change of policy that will make it much more difficult for traditional Orthodox Jewish students--both Hasidic (who follow a rebbe) and non-Hasidic (who don't)--to get deferments from the draft. Comments on the Yeshiva World website explain some of the debate.

The logistical questions

What's unclear is how large the ev…

Atlantic Yards/Pacific Park graphic: what's built/what might be coming (post-dated pinned post)

Click on graphic to enlarge. This is post-dated to stay at the top of the blog. It will be updated as announced configurations change and buildings launch. The August 2014 tentative configurations proposed by developer Greenland Forest City Partners will change, and the project is already well behind that tentative timetable.

Not quite the pattern: Greenland selling development sites, not completed condos

Real Estate Weekly, reporting on trends in Chinese investment in New York City, on 11/18/15 quoted Jim Costello, a senior vice president at research firm Real Capital Analytics:
“They’re typically building high-end condos, build it and sell it. Capital return is in a few years. That’s something that is ingrained in the companies that have been coming here because that’s how they’ve grown in the last 35 years. It’s always been a development game for them. So they’re just repeating their business model here,” he said. When I read that last November, I didn't think it necessarily applied to Atlantic Yards/Pacific Park, now 70% owned (outside of the Barclays Center and B2 modular apartment tower), by the Greenland Group, owned significantly by the Shanghai government.
A majority of the buildings will be rentals, some 100% market, some 100% affordable, and several--the last several built--are supposed to be 50% market/50% subsidized. (See tentative timetable below.)

Selling development …

Atlanta's Atlantic Yards moves ahead

First mentioned in April, the Atlantic Yards project in Atlanta is moving ahead--and has the potential to nudge Atlantic Yards in Brooklyn further down in Google searches.

According to a 5/30/17 press release, Hines and Invesco Real Estate Announce T3 West Midtown and Atlantic Yards:
Hines, the international real estate firm, and Invesco Real Estate, a global real estate investment manager, today announced a joint venture on behalf of one of Invesco Real Estate’s institutional clients to develop two progressive office projects in Atlanta totalling 700,000 square feet. T3 West Midtown will be a 200,000-square-foot heavy timber office development and Atlantic Yards will consist of 500,000 square feet of progressive office space in two buildings. Both projects are located on sites within Atlantic Station in the flourishing Midtown submarket.
Hines will work with Hartshorne Plunkard Architecture (HPA) as the design architect for both T3 West Midtown and Atlantic Yards. DLR Group will be t…