Skip to main content

"Because it is shovel-ready construction": FCR's lame explanation for seeking federal stimulus funds for an essentially private arena

It was one of the more astonishing exchanges at the informational meeting last Wednesday--Forest City Ratner's MaryAnne Gilmartin's explanation for why the developer has sought stimulus funds to boost its essentially private project.

Remember, the developer has lobbied for federal stimulus funds, and is almost certainly still lobbying for such help, even though former Empire State Development Corporation CEO Marisa Lago said at a May 29 state Senate oversight hearing that the ESDC hadn't sought such funds.

Why not? Because, as I note below--it's not a public project.


(Video shot by Jonathan Barkey; edited by Norman Oder)

“Can Forest City Ratner comment on why there have been public requests for federal stimulus funds to help with the construction of the arena?” asked moderator Craig Hammerman.

“It’s shovel-ready construction,” shouted Marie Louis of BUILD (Brooklyn United for Innovative Local Development), a Community Benefits Agreement (CBA) signatory.

Gilmartin at first looked a little uncomfortable with the question--perhaps because there's no good answer--but quickly recovered: “Because it is shovel-ready construction, and the fact of the matter is that the project, like other projects around the country, have suffered, based on the economic downturn, and it’s our responsibility to try to do what we can to make the project happen and to maintain its viability.”

Whose responsibility?

It's our responsibility, but who's "us"? "Us" is Forest City Ratner, parent company Forest City Enterprises, and its shareholders.

It's the government's responsibility to direct subsidies and aid to public projects, not private ones. There's a lot of private shovel-ready construction that doesn't deserve stimulus funds. And, at the least, should the project get more taxpayer money, the public should own an ever-increasing piece.

A private project

As I pointed out, how much of the shovel-ready construction put forth for stimulus funds consists of public works and how many are private developers' projects? See state list from ProPublica, and New York's list--and, further below, see the categories in which New York actually has spent money.

The arena, despite the fig leaf of public ownership to allow for the issuance of tax-free bonds, would be an essentially private project, given that Forest City Ratner gets to sell naming rights and keep profits.

At the oversight hearing

At the oversight hearing, state Senator Marty Golden, a project supporter, asked if there was any stimulus money for the project.

ESDC “has not asked for stimulus dollars,” Lago said.

Golden asked why not.

“In looking at the project and the amount of public subsidy and the right way of getting it forward, we have not determined that stimulus funds are part of that package,” Lago responded carefully.

Golden asked if there was enough money as designated in the original agreement.

“As we’re looking at the project now, as all of us are engaged in the sensitive negotiation, they have not entailed a request for stimulus money,” Lago said.

“If that request were made, would you be willing to make that request?” Golden asked.

“That would be something that we would consider,” Lago said. “We would of course look at the overall project plan.”

Golden said he’d make a request.

New York's list

In the list below of categories eligible for stimulus funds, I've cut the individual category figures out, but they're visible at this link:
Medicaid - FMAP Increase
State Fiscal Stabilization - Education Restoration
State Fiscal Stabilization - Other Government Services
State Fiscal Stabilization - Education Incentive Grants
Sub-total $140,317,000 $14,118,000

Infrastructure and Energy
Transportation: Mass Transit
Transportation: Highways & Bridges
Transportation: Rail
Transportation: Air
Transportation: Discretionary Surface Transportation
Clean Water State Revolving Fund
Drinking Water State Revolving Fund
Weatherization
Energy Efficiency and Conservation Block Grant
State Energy Program
Broadband Access & Expansion
Science Facilities, Research, Instrumentation
Science - Brookhaven Laboratory
Environmental/Nuclear Waste Cleanup
Diesel Emission Reduction
Environmental Programs
Sub-total $91,700,000 $4,162,000

Health and Human Services
Health Information Technology
Public Health Programs
IDEA for Infants & Families
Food Stamp Benefit Increase
Food Stamp Administration
WIC Program Administration
Senior Nutrition Program
Homeless Assistance
Child Care Block Grant
Child Support Administration
Title IV-E Programs (Foster Care/Adoption Assistance)
Community Service Block Grant (CSBG)
SSI - One-time Payment
Workforce Investment Act (WIA)
UI Benefit Extension & Administration
UI Modernization
UI Weekly Benefit Increase
Employment Services
Trade Adjustment Assistance
Vocational Rehabilitation (Title I)
Rehabilitation Services & Disability Research
Neighborhood Stabilization Program
HOME Investment Partnerships-Tax Credit Assistance
Community Development Block Grant (CDBG)
Public Housing Capital Fund
Public Housing Retrofits
Project Based Rental Assistance (Section 8)
Lead Hazard Reduction
Native American Housing Grants
Community Health Centers
Commodity Assistance Program
TANF Block Grant - Emergency Fund
Sub-total $113,666,000 $5,981,672

Education
Title I
IDEA/Special Education
Head Start & Early Head Start
Pell Grant Increase
Federal Work Study
Enhancing Education Technology
Education for Homeless Children & Youth
Teacher Incentive Fund
Impact Aid Construction
National Endowment for the Arts
National School Lunch Program Equipment Assistance
Sub-total $43,770,000 $2,360,521

Public Safety
Byrne/JAG
Community Oriented Policing Services (COPS)
Homeland Security - Fire Station Construction
Violence Against Women Prevention
Crime Victims Compensation and Assistance
Internet Crimes Against Children
Other Public Safety Programs
Sub-total $4,200,000 $124,200

Grand Total* $393,653,000 $26,746,393

* Does not include certain federal spending items included in the Act which do not impact New York or cannot be quantified.

Comments

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…

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 Matzav.com 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…

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…

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 …

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…

"There is no alternative": DM Glen on de Blasio's affordable housing strategy

As I've written, Mayor Bill de Blasio sure knows how to steer and spin coverage of his affordable housing initiatives.

Indeed, his latest announcement, claiming significant progress, came with a pre-press release op-ed in the New York Daily News and then a friendly photo-op press conference with an understandably grateful--and very lucky--winner of an affordable housing lottery.

To me, though, the most significant quote came from Deputy Mayor Alicia Glen, who, as the Wall Street Journal reported:
said public housing had been “starved” of federal support for years now, leaving the city with fewer ways of creating affordable housing. “Are we relying too heavily on the private sector?” she said. “There is no alternative.” Though Glen was using what she surely sees as a common-sense phrase, it recalls the slogan of a politician with whom I doubt de Blasio identifies: former British Prime Minister Margaret Thatcher, a Conservative who believed in free markets.

It suggests the limits to …