NYC: City of the Developer's Sweetheart Deal
Listening to NPR on Tueday morning they were covering a conference hosted by Crain's on NYC's recovery. Since I was at work, I only heard it intermittently, but was NOT impressed. It sounded like a dozen varieties of trickle down, voo-doo economics. Two basic themes were being put forward repeatedly during the parts I heard, with absolutely no challenge from the NPR folks:
1. Banks are our saviors and so need even more tax money for bailouts;
2. Developers are our saviors and so need more tax money for sweetheart deals from the city;
2a. A corollary to the second theme was we need infrastructure money because that benefits developers. That's right. Infrastructure was being discussed as helping DEVELOPERS not the community.
I would have more sympathy for theme 1 if it wasn't for the kind of crap banks are doing with massive bonuses to CEOs, trying to use bailout money to buy luxury planes (stopped only by direct intervention by the Obama administration) and stabbing Americans in the back by lobbying against fair pay like Bank of America and AIG were doing. But the bottom line is banks are happy to screw Americans while raking in a bailout handed to them from our tax money. I don't want banks to fail. But I DO want oversight, regulation and a fair deal from the banks, not more of the same corruption and predatory lending that got us into this.
Corollary 2a is interesting because everyone does want infrastructure improvements. It is just disturbing seeing it put forward largely as a boon to developers rather than to the CITY. I should note that a day or two ago on NPR I heard a union guy (SEIU??) complain about infrastructure improvement as stimulus because he thought it created too few jobs. I guess not surprisingly he was pushing for more stimulus money to go into the service sector. But most of us do want to see infrastructure improvements and the number of bridge collapses and levee breaks we have had around the nation during the Bush administration shows us how critical these improvements are.
As for main theme #2, seems to me developers already get way, way too much from our tax money here in NYC. I am sick and tired of NYC putting developers on a pedestal and claiming it's good for the community. At its best development is great. But the way it is done in NYC the developers get whatever they want and a vibrant community gets replaced by luxury condos and unfilled office space. And more often than not it is all done behind the backs of the voters. As long as developers get secret sweetheart deals, then back out of their promises, I do not believe development, as it has been implemented in recent years in NYC, is beneficial. We need development plans like the Unity Plan, not more and more overpriced and oversized projects that promise jobs and affordable housing but do a poor job of delivering anything but profits for millionaires at taxpayer expense.
And Bloomberg is at the head of this movement to give developers everything they want, usually through backroom deals.
Back in 2005 I wrote about (drawing from the Brooklyn Papers) how Pataki and Bloomberg basically promised mega-developer Bruce Ratner the moon without oversight, without city council or voter backing, and largely in secret. From that article (ultimately from the August 20, 2005 Park Slope Paper, print edition):
The same day they signed a widely publicized agreement setting aside land for developer Bruce Ratner's proposed Atlantic Yards project, top officials of the Pataki and Bloomberg administrations signed a separate pact with the developer, granting him the right to build up adjacent urban renewal sites without city review.
That second agreement was never made public, but it turned up this week in the state's response to a fairly broad Freedom of Information Act request made by a neighborhood group opposed to the Atlantic Yards plan.
The document stipulates that Ratner would be able to obtain the development rights to build nearly 1.9 million square feet of residential and commercial space on properties north and west of the Atlantic Avenue rail yards, exceeding the current zoning for those sites, without having to put the proposal through the city's lengthy land use review process.
All of this tax payer funded largess thrown at Ratner's feet in return for vague promises of affordable housing.
We all see how well THAT has come off, with Ratner pulling affordable housing off the table for the forseeable future even though all the tax money we gave him was predicated on the idea that he would return our generosity with affordable housing (NOTE: even the affordable housing he promised wasn't even considered affordable by Manhattan standards).
But it isn't just Ratner who gets sweetheart deals from Bloomberg. One of the speakers at the Crain's Big Business Love Fest (or that was how it seemed as presented on NPR) was Steve Ross, and he was one of the ones saying we need MORE tax money thrown at developers so they can save our city. Well, Steve Ross' name had just come up the very same morning in a story forwarded to me. Seems Ross already gets pretty much whatever he wants behind the scenes. Property that had been taken over by the city with the intent of condemnation to facilitate construction of the No. 7 line subway extension and a new subway station, was instead handed right on to Steve Ross in a secret deal made with Bloomberg. This comes from Phil DePaolo both by email and, in more complete form, on No Power Grab:
When the City Council approved the Hudson Yards development project in 2005, it gave the Bloomberg administration permission to condemn and acquire several parcels of land on Manhattan's far West Side.
One of those parcels was a city owned block along 42nd St.'s Theater Row, between Dyer and 10th Aves. The buildings there would be torn down to facilitate construction of the No. 7 line subway extension and eventually a new station on the site.
But the Council was never told the city had no intention of condemning the site.
The city had quietly decided to sell it to one of this town's biggest real estate developers, Stephen Ross, for the price of a song: $100,000...
Madison Equities showed an unpublicized July 22 2004 agreement among the city, that stated the city agreed to back the Ross partnership.
But at the Council, the speaker claimed to be shocked to learn about the secret sale of a property it had just approved for condemnation.
"It's very surprising," said Councilwoman Christine Quinn was quoted as saying, "When you don't make complete disclosures, for any reason, it raises questions."
For more sordid details go to No Power Grab.
So Bloomberg ONCE AGAIN uses our tax money in backroom deals to enrich developer buddies. And ONCE AGAIN a scandal happens right under the nose of Christine Quinn and she is shocked...SHOCKED!...to find out such things could happen under her watch.
What a load of crap. This city is run in such a corrupt fashion it is astonishing. Transparency is deliberately avoided in favor of an opaqueness required for backroom deals between wealthy buddies. Pataki was in the thick of it. Bloomberg still is in the thick of it and wants a third term to continue his enrichment of his buddies. Marty Markowitz is in the thick of it and wants a third term to further wallow in the money. Vito Lopez was so eager to be in the thick of it that even Bloomberg balked. And Quinn is either turning a blind eye or genuinely doesn't have a clue how to run a city government.
As with the banks, I do not advocate any taxpayer money going to developers unless there is also reform in the process, greater transparency, independent oversight, and greater benefit to the community.
What do we need? We need a new mayor. We need new blood in our city council. We need a Public Advocate like Norman Siegel, who is not the slave of developers but rather has a solid 30 year record of defending the public. We need a Comptroller who is willing to stand up against this kind of crap (that means NOT Weasel Yassky and NOT Melinda Katz ,who receives more developer money than any other NYC politician...which leaves Weprin for Comptroller? God knows). Sadly, unless Norm Siegel and either Anthony Weiner or Bill Thompson can pull it off despite developer and Bloomberg money backing the corrrupt status quo, we are more than likely going to see more of the same mismanagement of the city where parents are left out of the decisions about their kids' education, but developers get to write their own sweetheart deals and Bloomberg will sign on the dotted line with no oversight...and Quinn will be, yet again, shocked when she finds out.