On Saturday the Post editorialized against Mayor Bloomberg's executive order 71, an edict that resurrects the old Dinkins set-aside program for minority and women-owned businesses in city contracting. While not setting any strict quotas, the Order does establish a "goal based program" to increase the participation of the targeted firms.
As we have said on other occaisions we're not big fans of set-asides. In our view, and we have advocated on quite a few occaisions for minority businesses looking for city contracts, this kind of approach encourages a dishonest "booty capitalist" system with bogus front companies allying themselves with majority-owned firms.
That being said, however, it is important to point out that the current contracting system cries out for reform. Under Mayor Guiliani, praised by the Post for scuttling the Dinkins set-aside program, the awarding of development rights was strickly based on one's political loyalty to the mayor. So much so that we've described the Guiliani slogan: "One City, One Standard", as more aptly named "The Double Standard." Favoritism was simply given a lighter and greener pallor. In Guiliani's world, making room for up and coming minority entrepreneurs was simply never even considered.
Which brings us to to the Mayor Bloomberg. The key issue is always opportunity and fairness. Reaching out to minority entrepreneurs, and not just for a few subcontracting crumbs, should be part of any administration that is looking to encourage the greatest degree of inclusiveness. This is something that this mayoralty has not done.
The reason that it hasn't is because of the man in charge of economic development, Dan Doctoroff. The Deputy Mayor has raised favoritism to a new level so much so that we believe it deserves its own term: "patricianage." We are referring, of course, in particular to the relationship between Deputy Dan and Related's Steve Ross.
The deal at the BTM, as we have pointed out exhaustively, is one of the prime examples. No-bid contracts with city syrup sweetening the packages is the hallmark of the Dan-Steve collaboration. If you are going to advocate for "one standard," as the Post does, then you are under the obligation to examine how the city contracting process actually works. If you don't, you put yourself in the position of decrying favoritism while turning a blind eye to the kind of unequal treatment that gets overlooked because it is seen as business as usual.
Related, Ross and the Bradhurst Development at 145th Street
The most eggregious example of patricianage in the agrandizement of Related came right at the start of the Bloomberg term. In February, 2002, at the same time that Deputy Dan was requesting a conflicts ruling from the COIB about his relationship with Steve Ross, he personally intervened in the Bradhurst development contract that had been languising in the final days of the Guiliani administration.
The reason the development was on life support derived from the failure of Related to properly gauge the full scope of the development costs. Having failed to do so the developer, hat in hand, had come back to the city for additional subsidies.
The problem here was that a number of other folks had bid for the development rights including the Fernandez brothers whose company, M&M Enterprises, owns five supermarkets in the Bradhurst area. Since the Bradhurst project included a supermarket as well as housing, the Fernandez bid had a great deal of merit. M&M, grossing over $50 million a year, was also backed be the White Rose Food Corporation and Chase Bank, making it a substantial bidder.
It would seem, as the Post editorial suggests, that the city should be awarding bids based on expertise. When it was shown, however, that Related, with billions of dollars of equity, couldn't do the Bradhurst deal without additional city funding the award should have been withdrawn and a new bid process begun.
In fact, when Related came to the city for more money in the previous administration then Deputy Mayor Rudy Washington, the one man in the Guiliani crowd who had a sense of fairness and decency, flatly turned Mr. Ross and company down saying that if the city was going to subsidize anyone than it should be local minority entrepreneurs like the Fernandez brothers. That is the kind of simple equity that doesn't exist when the cronyism of the mega-wealthy dictates policy (Is anyone really surprised that Rudy Washington, as loyal a soldier as anyone in the previous administration, seems to have been the only one not included in Guiliani Partners. Yet Bernie Kerik was!).
Post Needs To Examine Bradhurst and the BTM
One of the catchy lines in the Post editorial was the observation that set-asides lead to "corruption, overpricing and less-than-top-services." We agree, but only if the concept of set-asides is expanded to include the setting aside of city property for Deputy Dan's good friend.
Any comprehensive examination of the BTM deal will reveal that in the sale of the property and in the "negotiation" of the 99 year lease the evidence of corruption and overpricing is manifest. So our advice to the Post is to keep advocating for a level playing field but do so with an eye towards exposing those occasions where old fashion political payoffs or cronyism give unfair advantage, at the expense of city tax payers, to the well-connected.
Showing posts sorted by relevance for query Bradhurst. Sort by date Show all posts
Showing posts sorted by relevance for query Bradhurst. Sort by date Show all posts
Monday, September 12, 2005
Friday, December 07, 2007
Dander-Up and Out
Deputy Dan the Related man is leaving City Hall, Bloomberg LLP apparently has outbid the Related Companies for the Music Man's services. As the NY Times reports this morning, the departure has generated mixed feelings: "But just as Mr. Moses’ legacy is still intensely debated, interviews with more than a dozen experts and analysts suggest that Mr. Doctoroff’s effect on the city has been decidedly mixed. Some credited him with setting in motion comprehensive plans to guide growth in the city’s neighborhoods for decades to come, while others said he had often failed to see his plans through."
Then there's the way in which Deputy Dan operated-always with disdain for the small and minority businesses that do so much to sustain this city, but who fly far below the Doctoroff radar. On first entering government in 2003, DD immediately pushed the Fernandez Brothers out of the Bradhurst development project; and what was to become a trend, leveraged city funds to bring in his friend Steve Ross' Related Companies.
It became such a pronounced mode of operation that we gave it its own bane-"patricianage;" the process by which Related and to a lesser extent Vronado were given "special nation status" by the ever-accommodating deputy toady. The process reached its apotheosis with the debacle at the Bronx Terminal Market. Here Dan pushed out the mostly minority distributors, ran roughshod over city procurement policies, and no-bidded Related into a sweetheart deal that future analysts will label for what it is: a more sophisticated version of what the famed sage of Tammany Hall called, "honest graft."
The mayor's encomiums to his liege were touching, but, as Azi cites, disingenuous: "A notably unhappy Michael Bloomberg just announced that Dan Doctoroff is leaving City Hall, saying, "Dan brought muscle to economic development. Bloomberg also said that "unlike Robert Moses, Dan did it by working with the communities, not bulldozing them." Nothing like a parting jest to liven up a sad leave-taking.
The reality is that Dan's idea of community partnership is epitomized by the charade up in West Harlem over the Columbia expansion. Here Dan himself injected Jesse Masyr into the creation of a local development corporation charged with the negotiation of a community benefits agreement with Columbia. That's kind of like a valedictory to the Doctoroff approach to community input-the Machiavellian appearing to be good, rather than actually being good.
There's an old Wallace Stevens poem about Vladimir Lenin that has a line that goes something like this: "Lenin sat on a bench by a lake full of swans, the swans flew away; he was not a man for swans." Dan was not a man for collaboration with local communities, nor was he any kind of suitor for the little retailers and wholesalers who would never be seen chatting in the clubs that the Deputy frequented. He may have spearheaded some good-and not so good-large-scale developments but let's not reincarnate him as Jane Jacobs.
As the Times points out in regard to Doctoroff's failed Olympic and West Side Stadium projects: "But that approach {his impatience with politicians and bureaucracy} could also be his undoing, as was the case with the West Side stadium at the heart of the failed 2012 Olympic bid. Mr. Doctoroff gathered support from corporate executives, but underestimated the need to woo politicians and community groups." As Marc Shaw says: “The mayor didn’t hire Dan to do politics, nor would Dan have been good at politics.”
So Dan departs and as the pundits say, his legacy remains to be determined by more dispassionate future observers. From our lowly perch, however, nothing so becomes Dan as his leaving.
Then there's the way in which Deputy Dan operated-always with disdain for the small and minority businesses that do so much to sustain this city, but who fly far below the Doctoroff radar. On first entering government in 2003, DD immediately pushed the Fernandez Brothers out of the Bradhurst development project; and what was to become a trend, leveraged city funds to bring in his friend Steve Ross' Related Companies.
It became such a pronounced mode of operation that we gave it its own bane-"patricianage;" the process by which Related and to a lesser extent Vronado were given "special nation status" by the ever-accommodating deputy toady. The process reached its apotheosis with the debacle at the Bronx Terminal Market. Here Dan pushed out the mostly minority distributors, ran roughshod over city procurement policies, and no-bidded Related into a sweetheart deal that future analysts will label for what it is: a more sophisticated version of what the famed sage of Tammany Hall called, "honest graft."
The mayor's encomiums to his liege were touching, but, as Azi cites, disingenuous: "A notably unhappy Michael Bloomberg just announced that Dan Doctoroff is leaving City Hall, saying, "Dan brought muscle to economic development. Bloomberg also said that "unlike Robert Moses, Dan did it by working with the communities, not bulldozing them." Nothing like a parting jest to liven up a sad leave-taking.
The reality is that Dan's idea of community partnership is epitomized by the charade up in West Harlem over the Columbia expansion. Here Dan himself injected Jesse Masyr into the creation of a local development corporation charged with the negotiation of a community benefits agreement with Columbia. That's kind of like a valedictory to the Doctoroff approach to community input-the Machiavellian appearing to be good, rather than actually being good.
There's an old Wallace Stevens poem about Vladimir Lenin that has a line that goes something like this: "Lenin sat on a bench by a lake full of swans, the swans flew away; he was not a man for swans." Dan was not a man for collaboration with local communities, nor was he any kind of suitor for the little retailers and wholesalers who would never be seen chatting in the clubs that the Deputy frequented. He may have spearheaded some good-and not so good-large-scale developments but let's not reincarnate him as Jane Jacobs.
As the Times points out in regard to Doctoroff's failed Olympic and West Side Stadium projects: "But that approach {his impatience with politicians and bureaucracy} could also be his undoing, as was the case with the West Side stadium at the heart of the failed 2012 Olympic bid. Mr. Doctoroff gathered support from corporate executives, but underestimated the need to woo politicians and community groups." As Marc Shaw says: “The mayor didn’t hire Dan to do politics, nor would Dan have been good at politics.”
So Dan departs and as the pundits say, his legacy remains to be determined by more dispassionate future observers. From our lowly perch, however, nothing so becomes Dan as his leaving.
Friday, February 11, 2011
Hearing Things
Greg David has some wild speculation concerning Walmart, Mike Bloomberg and the Related Companies-apparently seeing things that no one else can. David sees, in the mayor's selection of Related for the development of Hunters Point South, a message for Walmart foes: "As the opponents of Walmart continue their campaign to prevent the company from opening stores in New York, it remains a mystery how they intend to do that. The City Council has no power to intervene in leases signed at existing retail locations, and the company seems more determined than ever to take on the Big Apple...Another possibility is that labor unions and their allies will raise such a ruckus that landlords will have second thoughts about leasing space to Walmart. After all, any future help a developer needs from city government will run into trouble, right? No, or at least not as long as Michael Bloomberg is running the show."
Who in their right mind would have ever thought that Mike Bloomberg would act as a Walmart retardant mayor? If there would be any impediment to a developer, it would have to come at the city council-which last we heard still has oversight over the city's land use process.
But the really risible observation from David is that the selection of Related for a city development has any more meaning beyond the fact the the city has dropped its draws for this company ever since Deputy Dan Doctoroff (a good pal of Related CEO Steve Ross) deeded over Bradhurst Avenue development and the Bronx Terminal Market to Related (without any competitive bid in the latter case).
This makes the following David observation about the Hunters Point award a great comedic foray: "That's the message from yesterday's announcement that Related, the company in talks to bring a Walmart to its Gateway project in Brooklyn, won the hotly contested competition to build affordable middle class housing in Queens. Let's accept the administration's position that Related and its partners offered the best proposal. It is also clear that this is a message that Related will not be penalized for doing business with Walmart."
Not penalized by the Related-fawning Mike Bloomberg? This is all simply a process that Dan Janison has labeled, "patricianage;" the awarding of favors to well connected friends of the Bloombergistas-a phenomenon that we don't recall hearing any critical Greg David comments about; even though Doctoroff and Ross were friends and long time business partners. It says nothing about the ability of the council-should it choose to exercise it-to warn off developers looking to engage with the Walmonster.
Who in their right mind would have ever thought that Mike Bloomberg would act as a Walmart retardant mayor? If there would be any impediment to a developer, it would have to come at the city council-which last we heard still has oversight over the city's land use process.
But the really risible observation from David is that the selection of Related for a city development has any more meaning beyond the fact the the city has dropped its draws for this company ever since Deputy Dan Doctoroff (a good pal of Related CEO Steve Ross) deeded over Bradhurst Avenue development and the Bronx Terminal Market to Related (without any competitive bid in the latter case).
This makes the following David observation about the Hunters Point award a great comedic foray: "That's the message from yesterday's announcement that Related, the company in talks to bring a Walmart to its Gateway project in Brooklyn, won the hotly contested competition to build affordable middle class housing in Queens. Let's accept the administration's position that Related and its partners offered the best proposal. It is also clear that this is a message that Related will not be penalized for doing business with Walmart."
Not penalized by the Related-fawning Mike Bloomberg? This is all simply a process that Dan Janison has labeled, "patricianage;" the awarding of favors to well connected friends of the Bloombergistas-a phenomenon that we don't recall hearing any critical Greg David comments about; even though Doctoroff and Ross were friends and long time business partners. It says nothing about the ability of the council-should it choose to exercise it-to warn off developers looking to engage with the Walmonster.
Friday, April 18, 2008
This Little Piggy...
Will wonders never cease. In the category of the kettle calling the pot black, the mayor's calling om the City Council to bid out more of its discretionary spending items. As the NY Post reports this morning, " Calling for a reforms in how the City Council doles out pork-barrel funds, Mayor Bloomberg said yesterday that large grants to nonprofit groups should be awarded only by competitive bidding."
What's that about people in glass houses? Maybe the mayor just wasn't paying all that much attention when Deputy Dan Doctoroff started to give away city property to his buddy Steve Ross at the Related Company-a process that actually began only two months into the mayor's first term when Doctoroff awarded the Bradhurst development to Related along with the public subsidy that the Giuliani folks wouldn't pony up because of the issue of fairness.
The continued aggrandizement of Mr. Ross was aided and abetted by a whitewashed DOI investigation of the potential conflict of interest between Doctoroff and Ross-old friends and former business partners; a whitewashing that continued even as Deputy Dan was leaving government to set up shop at Bloomberg LLP. The most egregious example of this favoritism is of course the Bronx Terminal Market give away.
It is useful to revisit this incredible use of personal favoritism to aggrandize a super wealthy developer. Here's our original post:
Tuesday, August 02, 2005
Immaculate Deception
The City’s EDC is still twisting, turning and spinning in its effort to explain the supposedly autonomous manner in which the Related Companies managed to, all on its own, wedge itself into a lucrative no-bid deal to develop the Bronx Terminal Market. In a press statement the City asserted the following. Our responses are listed under each item:
1) The City could not have a bidding process because it didn’t control the site The City could have quite easily and legally issued a Request for Expressions of Interests (REI) for the BTM site. By doing so it could have gauged what the level of interest was for the site, what kind of diverse visions existed for the site and, most importantly, the potential value of the site when bid for on an open market.
2) The City “engaged a mediator” who recommended that Buntzman (the old landlord) bring in a developer to “increase the property’s value” If the City engaged a mediator then there was a level of public involvement that clearly disproves that this was a private deal. In addition, the charge to see if and how the property’s value could be enhanced also suggests that the City, far from speculating, already had a decent idea of how this could be done.
3) Buntzman met with “several developers” (including Related) Who besides Related did Buntzman meet with? Can we ask these folks to step forward in order to discuss their views about “enhancing the property’s value?” Also, are they at all miffed at not being included in the development? If they could speak without fear of reprisal would they characterize the City’s role as neutral?
4) The City asked Related to assess this site’s potential. How did Related get picked to “assess the site’s value?” (It seems to us that some steps are missing here).
5) Related thought the site had potential for retail and began discussions with Buntzman that resulted in the following “private actions:” a) Related buys Buntzman’s lease and b) Buntzman drops legal action against the City. So the “private action” only became private after Related somehow got exclusivity and after some failrly public interventions by the City. The dropping of all legal actions could not have occurred without the acquiescence of the landlord and NYC and it is likely that Buntzman was made aware that Related’s offer would be the one sanctioned by the City. The question then becomes: Would Bunzman have taken $42 million from another developer?
6)The City cannot “speak to” the discrepancy between the value of the velodrome and property and the House of Detention (HOD). Here’s the one honest statement in the release. The City can’t speak to the discrepancy because, having foregone all standard real estate due diligence (like appraisals) they simply and cavalierly swap parcels using an unacknowledged or nonexistent standard of comparison.
7) Related paid Buntzman $42 million for its lease. Once again the negotiations leading to Buntzman agreeing to be bought out, as well as the City’s role in that process, remain shrouded in mystery.
8) Related will be paying ground lease rent to the City when the development lease is signed and base rate plus a percentage of the revenue when the retail development opens. Ah the lease. The press release doesn’t mention just how favorable this is and avoids pointing out that in year 99 of the final lease the Related Companies will be paying less money on 2,500,000 sq. ft (around $2,000,000 a year) than the market tenants are currently paying on 403,000 sq. ft (around $3,360,000 a year)
9) The House of Detention is not now part of the current development plan nor is the velodrome site but the City has until April 2006 to decide on the House of Detention and Related can exercise an option on the veledrome site at which time rent will be negotiated
As to the “uncertainty” involving the HOD and the velodrome this is pure hogwash. The city will transfer the jail and Related will exercise its option because all of this is contained in the Memorandum of Understanding (MOU) between Related and the City. All parties simply want to keep the more controversial aspects of the deal out of the current land use application.One last observation about how private this BTM deal is: In the documents gathered by the merchants’ lawyers a 2002 rendering was found that depicted the Olympic velodrome on the BTM site. This was a full year before the Related deal was finalized! Clearly, Deputy Dan and the City were involved from the very beginning in the effort to advance an Olympic venue and to do so with a developer who happened to be Dan’s former business partner and a stakeholder in NYC 2012.
So now we come full circle, and Mayor Mike wants to introduce an RFP process for the council's spending. And the D (umb) O I(ncompetent) is looking into the council member items. As the NY Daily News points out: "Department of Investigation probers are poring through thousands of documents bearing the names of politicians, dollar amounts and a roster of nonprofit groups - some real, some not."
DOI should get its own house in order-maybe starting at DOE; and the council, as an independent branch of government, should tell the mayor's lackeys to take a hike-and launch their own investigation with an outside independent investigator hired at the council's behest. Letting the Bloombergistas into all of this is taking hypocrisy to a new level. It's time that the city council asserted its independent authority.
What's that about people in glass houses? Maybe the mayor just wasn't paying all that much attention when Deputy Dan Doctoroff started to give away city property to his buddy Steve Ross at the Related Company-a process that actually began only two months into the mayor's first term when Doctoroff awarded the Bradhurst development to Related along with the public subsidy that the Giuliani folks wouldn't pony up because of the issue of fairness.
The continued aggrandizement of Mr. Ross was aided and abetted by a whitewashed DOI investigation of the potential conflict of interest between Doctoroff and Ross-old friends and former business partners; a whitewashing that continued even as Deputy Dan was leaving government to set up shop at Bloomberg LLP. The most egregious example of this favoritism is of course the Bronx Terminal Market give away.
It is useful to revisit this incredible use of personal favoritism to aggrandize a super wealthy developer. Here's our original post:
Tuesday, August 02, 2005
Immaculate Deception
The City’s EDC is still twisting, turning and spinning in its effort to explain the supposedly autonomous manner in which the Related Companies managed to, all on its own, wedge itself into a lucrative no-bid deal to develop the Bronx Terminal Market. In a press statement the City asserted the following. Our responses are listed under each item:
1) The City could not have a bidding process because it didn’t control the site The City could have quite easily and legally issued a Request for Expressions of Interests (REI) for the BTM site. By doing so it could have gauged what the level of interest was for the site, what kind of diverse visions existed for the site and, most importantly, the potential value of the site when bid for on an open market.
2) The City “engaged a mediator” who recommended that Buntzman (the old landlord) bring in a developer to “increase the property’s value” If the City engaged a mediator then there was a level of public involvement that clearly disproves that this was a private deal. In addition, the charge to see if and how the property’s value could be enhanced also suggests that the City, far from speculating, already had a decent idea of how this could be done.
3) Buntzman met with “several developers” (including Related) Who besides Related did Buntzman meet with? Can we ask these folks to step forward in order to discuss their views about “enhancing the property’s value?” Also, are they at all miffed at not being included in the development? If they could speak without fear of reprisal would they characterize the City’s role as neutral?
4) The City asked Related to assess this site’s potential. How did Related get picked to “assess the site’s value?” (It seems to us that some steps are missing here).
5) Related thought the site had potential for retail and began discussions with Buntzman that resulted in the following “private actions:” a) Related buys Buntzman’s lease and b) Buntzman drops legal action against the City. So the “private action” only became private after Related somehow got exclusivity and after some failrly public interventions by the City. The dropping of all legal actions could not have occurred without the acquiescence of the landlord and NYC and it is likely that Buntzman was made aware that Related’s offer would be the one sanctioned by the City. The question then becomes: Would Bunzman have taken $42 million from another developer?
6)The City cannot “speak to” the discrepancy between the value of the velodrome and property and the House of Detention (HOD). Here’s the one honest statement in the release. The City can’t speak to the discrepancy because, having foregone all standard real estate due diligence (like appraisals) they simply and cavalierly swap parcels using an unacknowledged or nonexistent standard of comparison.
7) Related paid Buntzman $42 million for its lease. Once again the negotiations leading to Buntzman agreeing to be bought out, as well as the City’s role in that process, remain shrouded in mystery.
8) Related will be paying ground lease rent to the City when the development lease is signed and base rate plus a percentage of the revenue when the retail development opens. Ah the lease. The press release doesn’t mention just how favorable this is and avoids pointing out that in year 99 of the final lease the Related Companies will be paying less money on 2,500,000 sq. ft (around $2,000,000 a year) than the market tenants are currently paying on 403,000 sq. ft (around $3,360,000 a year)
9) The House of Detention is not now part of the current development plan nor is the velodrome site but the City has until April 2006 to decide on the House of Detention and Related can exercise an option on the veledrome site at which time rent will be negotiated
As to the “uncertainty” involving the HOD and the velodrome this is pure hogwash. The city will transfer the jail and Related will exercise its option because all of this is contained in the Memorandum of Understanding (MOU) between Related and the City. All parties simply want to keep the more controversial aspects of the deal out of the current land use application.One last observation about how private this BTM deal is: In the documents gathered by the merchants’ lawyers a 2002 rendering was found that depicted the Olympic velodrome on the BTM site. This was a full year before the Related deal was finalized! Clearly, Deputy Dan and the City were involved from the very beginning in the effort to advance an Olympic venue and to do so with a developer who happened to be Dan’s former business partner and a stakeholder in NYC 2012.
So now we come full circle, and Mayor Mike wants to introduce an RFP process for the council's spending. And the D (umb) O I(ncompetent) is looking into the council member items. As the NY Daily News points out: "Department of Investigation probers are poring through thousands of documents bearing the names of politicians, dollar amounts and a roster of nonprofit groups - some real, some not."
DOI should get its own house in order-maybe starting at DOE; and the council, as an independent branch of government, should tell the mayor's lackeys to take a hike-and launch their own investigation with an outside independent investigator hired at the council's behest. Letting the Bloombergistas into all of this is taking hypocrisy to a new level. It's time that the city council asserted its independent authority.
Tuesday, September 30, 2008
Let the Voters Speak
All of the calls for extending Mike Bloomberg's term in office begin to remind us of the stench of insider trading. As we have said before, if the mayor was so prescient-and indispensible according to some-why wasn't he on top of this fiscal crisis from the get go? And isn't it instructive to point out that all of the culprits in the economic meltdown are part of Bloomberg's cohort?
Take Hank Paulsen; or, as Henny Youngman would have said, "Please!" Here's a guy, recruited from Goldman Sachs, who never had a clue and whose only interest in a solution seems to involve bailing out his banker friends. Here's Michael Daley's wonderful piece in the NY Daily News this morning: "No honest, hardworking New Yorker can rightly blame those hayseeds beyond the Hudson for balking at bailing out Wall Street. Just stroll past the new Goldman Sachs headquarters going up at the edge of Ground Zero with subsidies it squeezed from us in our desperation to recover from 9/11."
And who headed up GS at the time? "The firm was being run by none other than Henry Paulson when it shook us down for more than $115 million in tax breaks along with $1.65 billion in low-interest, tax-free Liberty Bonds." And as Daley points out: "Paulson assured us the financial system was sound right up to when it began to implode. He predicted a complete collapse unless there was what he called a bailout." And who was the mayor who approved this largess? Yup, that's right, Mayor Mike; doing what comes naturally-supporting his own.
The same good government fella who evicted small merchants from the BTM on behalf of Billionaire Ross and his Related Company-the same company who was given $5 million dollars in subsidies to supplant the Fernandez Brothers on Bradhurst Avenue. The same mayor looking to use eminent domain to evict Nick Sprayregen for Columbia University, and 250 businesses and 2,000 workers from Willets Point so that another fat cat can profit-all in the public interest; at least as it is conceived of by the NYC Partnership (partners with the people?)
If Bloomberg wants another term, let him call for a special election and put it to the voters. If that's not feasible, well, too bad. As the Villager points out, "Let the Voters Speak:" "Some would argue that, given the current financial crisis, it would be a good idea to allow Mayor Bloomberg — a self-made billionaire businessman and tested public servant — a chance to serve another term. Actually, we agree with that logic. That said, who decides on extending term limits? Should it be 52 individuals — the council members and the mayor — or millions of voters? We feel strongly it must be the latter."
Anything less amounts to little more than a putsch. As the NY post story today underscores: "Voters overwhelmingly supported term limits in two voter referendums in the 1990s, including a bid by then-Mayor Rudy Giuliani to extend the law for the City Council to three terms in 1996. The measure failed." Time to evict all of the insider traders.
Take Hank Paulsen; or, as Henny Youngman would have said, "Please!" Here's a guy, recruited from Goldman Sachs, who never had a clue and whose only interest in a solution seems to involve bailing out his banker friends. Here's Michael Daley's wonderful piece in the NY Daily News this morning: "No honest, hardworking New Yorker can rightly blame those hayseeds beyond the Hudson for balking at bailing out Wall Street. Just stroll past the new Goldman Sachs headquarters going up at the edge of Ground Zero with subsidies it squeezed from us in our desperation to recover from 9/11."
And who headed up GS at the time? "The firm was being run by none other than Henry Paulson when it shook us down for more than $115 million in tax breaks along with $1.65 billion in low-interest, tax-free Liberty Bonds." And as Daley points out: "Paulson assured us the financial system was sound right up to when it began to implode. He predicted a complete collapse unless there was what he called a bailout." And who was the mayor who approved this largess? Yup, that's right, Mayor Mike; doing what comes naturally-supporting his own.
The same good government fella who evicted small merchants from the BTM on behalf of Billionaire Ross and his Related Company-the same company who was given $5 million dollars in subsidies to supplant the Fernandez Brothers on Bradhurst Avenue. The same mayor looking to use eminent domain to evict Nick Sprayregen for Columbia University, and 250 businesses and 2,000 workers from Willets Point so that another fat cat can profit-all in the public interest; at least as it is conceived of by the NYC Partnership (partners with the people?)
If Bloomberg wants another term, let him call for a special election and put it to the voters. If that's not feasible, well, too bad. As the Villager points out, "Let the Voters Speak:" "Some would argue that, given the current financial crisis, it would be a good idea to allow Mayor Bloomberg — a self-made billionaire businessman and tested public servant — a chance to serve another term. Actually, we agree with that logic. That said, who decides on extending term limits? Should it be 52 individuals — the council members and the mayor — or millions of voters? We feel strongly it must be the latter."
Anything less amounts to little more than a putsch. As the NY post story today underscores: "Voters overwhelmingly supported term limits in two voter referendums in the 1990s, including a bid by then-Mayor Rudy Giuliani to extend the law for the City Council to three terms in 1996. The measure failed." Time to evict all of the insider traders.
Friday, August 28, 2009
More Armory Wages of Sin
The question that some of the opponents of the redvelopment of the Kingsbridge Armory have is; Can the unbridled greed and naked political power of the Related Companies be thwarted in the interests of what's best for the local community and the city as a whole? Up until now, Related has been able to really do anything it wants-and get from Mike Bloomberg everything that it has asked for; from the redevelopment of Bradhurst Avenue, to the two Gateway Mall projects, nothing has stood in the company's way. Perhaps, until now.
You see a coalition of business, labor and community is growing that would restrict the unilateral scope of the real estate giant's reach-and if Related balks on a CBA it could, as we have said before, lead to the scuttling of the entire enterprise. As the Bronx News Network reports:
"This morning, Bronx Boro Prez Ruben Diaz, Jr. and Stuart Applebaum, the head of the Retail, Wholesale and Department Store Union, held a press conference on Kingsbridge Road, in front of the Kingsbridge Armory, to show solidarity in their opposition to a big-box supermarket at the Armory and also to promote the merits of the Community Benefits Agreement (CBA) they sent to the Related Companies (the Armory's developer) last week.Also showing their support were Assemblyman Jose Rivera, Councilwoman Maria Baez (suddenly, she's everywhere these days), Ozzie Brown of Community Board 7 and some members of the Kingsbridge Armory Redevlopment Alliance (KARA)."
Quite an array of political bedfellows. It seems that Related has the uncanny ability to unite all factions in the borough; and if all of these folks stay together on the supermarket and living wage question than Related will have to decide if it makes business sense to develop the Armory-because if unanimity reigns here, than the city council will be hard pressed to over ride the wishes of the entire borough. It's not as if developing the Armory is like the continuation of some vital city service-something that demands ignoring the wishes of the entire borough's political establishment.
The challenge here for all of those standing in the way of Related's unfettered development desires, is to come to an agreement that all of the players can stand behind. We don't think that point has been reached, but we're sanguine that agreement can eventually be achieved since the goals of the coalition are solid.
As BNN tells us: "We also learned a few more details about what's included in the draft CBA sent to Related. One, as we reported last week, there is indeed a living wage "policy" included. Applebaum talked about a "living wage" of $10 an hour still only adds up $21,000 for a year. “Related is saying that $21,000 is too much to give workers in the Bronx, and I don’t accept that,” he said."
And with Bronx unemployment at a record 12.5%, the borough needs to have the kind of employment that rises above the minimum-something that chains stores are capable of doing if they want to do business in the community. If Related balks, our suggestion is to de-designated the company; and figure out anew how to develop the Armory in a way that treats the neighborhood with respect, and provides meaningful economic development for the borough's struggling work force.
You see a coalition of business, labor and community is growing that would restrict the unilateral scope of the real estate giant's reach-and if Related balks on a CBA it could, as we have said before, lead to the scuttling of the entire enterprise. As the Bronx News Network reports:
"This morning, Bronx Boro Prez Ruben Diaz, Jr. and Stuart Applebaum, the head of the Retail, Wholesale and Department Store Union, held a press conference on Kingsbridge Road, in front of the Kingsbridge Armory, to show solidarity in their opposition to a big-box supermarket at the Armory and also to promote the merits of the Community Benefits Agreement (CBA) they sent to the Related Companies (the Armory's developer) last week.Also showing their support were Assemblyman Jose Rivera, Councilwoman Maria Baez (suddenly, she's everywhere these days), Ozzie Brown of Community Board 7 and some members of the Kingsbridge Armory Redevlopment Alliance (KARA)."
Quite an array of political bedfellows. It seems that Related has the uncanny ability to unite all factions in the borough; and if all of these folks stay together on the supermarket and living wage question than Related will have to decide if it makes business sense to develop the Armory-because if unanimity reigns here, than the city council will be hard pressed to over ride the wishes of the entire borough. It's not as if developing the Armory is like the continuation of some vital city service-something that demands ignoring the wishes of the entire borough's political establishment.
The challenge here for all of those standing in the way of Related's unfettered development desires, is to come to an agreement that all of the players can stand behind. We don't think that point has been reached, but we're sanguine that agreement can eventually be achieved since the goals of the coalition are solid.
As BNN tells us: "We also learned a few more details about what's included in the draft CBA sent to Related. One, as we reported last week, there is indeed a living wage "policy" included. Applebaum talked about a "living wage" of $10 an hour still only adds up $21,000 for a year. “Related is saying that $21,000 is too much to give workers in the Bronx, and I don’t accept that,” he said."
And with Bronx unemployment at a record 12.5%, the borough needs to have the kind of employment that rises above the minimum-something that chains stores are capable of doing if they want to do business in the community. If Related balks, our suggestion is to de-designated the company; and figure out anew how to develop the Armory in a way that treats the neighborhood with respect, and provides meaningful economic development for the borough's struggling work force.
Monday, February 14, 2011
Related Problems for Walmart
As Crain's is reporting, pressure is being brought to bear on Related Companies to convince the real estate giant that partnering with Walmart isn't good for business: "Opponents of Walmart plan to ratchet up the pressure on heavyweight developer The Related Companies this week, in a concerted campaign to show the city's real estate community that there's a potential cost to doing business with the nation's biggest retailer. Related has had contact with Walmart about leasing a site at its 650,000-square-foot Gateway II shopping center in East New York, Brooklyn, that already received the City Council's approval, enraging those unions, small storeowners and council members that oppose the retailer's entry into the city. Opponents hope to persuade Walmart's local partners—with threats of pickets outside their headquarters or homes and other actions—that doing business with the retailer will damage their future council dealings."
The Crain's report underscores our critique of Crain's columnist Greg David's observations that the mayor selection of Related to co-develop the Hunters Point site indicates that, "Let's accept the administration's position that Related and its partners offered the best proposal. It is also clear that this is a message that Related will not be penalized for doing business with Walmart."
But as we pointed out-and as today's Crain's report bolsters-all the Related selection indicates is that the Bloombergistas will still favor the company in any and all circumstances; but the mayor isn't the whole ball of wax by any means:
"Who in their right mind would have ever thought that Mike Bloomberg would act as a Walmart retardant mayor? If there would be any impediment to a developer, it would have to come at the city council-which last we heard still has oversight over the city's land use process.
But the really risible observation from David is that the selection of Related for a city development has any more meaning beyond the fact the the city has dropped its draws for this company ever since Deputy Dan Doctoroff (a good pal of Related CEO Steve Ross) deeded over Bradhurst Avenue development and the Bronx Terminal Market to Related (without any competitive bid in the latter case)."
What we are beginning to see is how other power centers are being engaged to challenge Related's scope of action-and it would do David well to remember that Related has less than a three year run left with Uncle Mike: "The Walmarts of the world may think they can ignore us, but the Relateds of the world can't,” state Sen. Diane Savino, D-Staten Island, told Crain's last month. “These are guys who want to develop in other places in the city. They could find that their relationship with Walmart may permanently damage their relationship with the city.”
Which brings our attention to Willets Point-and, as we have observed, the development could very well become a future Walmart site since the council, just as it did in Gateway II, failed to restrict the kinds of permissible uses at the site: "Opponents believe they have leverage over Related in part because it is one of 29 firms that have expressed interest in redeveloping Willets Point, a run-down section of northeast Queens slated to be remade with retail outlets, housing, a hotel and office space. The city will issue a request for proposals for the redevelopment in April. On Monday, three elected officials who represent the Willets Point area—Councilwoman Julissa Ferreras, state Sen. José Peralta and Assemblyman Francisco Moya—will send a letter to Related Chief Executive Stephen Ross, pressuring him to shun Walmart."
The letter, however, lacks real teeth: "We have a long working relationship together, creating new economic opportunities for New Yorkers and building more vibrant neighborhoods, and we hope to continue that strong partnership moving forward, perhaps at Willets Point,” reads the letter, a copy of which was provided to Crain's by the Walmart Free NYC coalition. “That's why we're urging you not to do business with Walmart at Gateway II or any other New York City location.”
But, as we have pointed out, the area elected officials do have some stronger medicine in regards to the future of Willets Point. As we indicate on the blog this morning, EDC is operating in an extra-legal manner to circumvent city council oversight and appropriate SEQR review on the Iron Triangle site.
Put simply, EDC is developing a 20 acre Phase I at Willets Point without building requisite ramps off of the Van Wyck that would mitigate the traffic generated. In addition, they have not deigned to indicate what will be the uses developed on this initial phase-and it is a short step towards realizing that Walmart or any large box store uses could easily fit in this first phase of development.
EDC's own traffic consultants, however, estimated that the project would generate 80,000 new car trips a day-much of this from the projected retail uses slated for the new development. If the lion's share of these uses are placed in the first phase, EDC has no justification not proceeding with the ramp approval process-before going ahead with condemning 53 small businesses at Willets Point. It told the council specifically that it would not do this-making Willets Point, like Gateway II, a perfect place for the city's (and the developer's) bait and switch.
A forceful collective response to the city on this dishonest attempt to end run proper review procedures-and a resultant restrictive covenant on the Willets Point site, would make the council players in the Gateway debate as well. The council needs to establish the fact that it has a strong hole card in this game of high stakes development poker-and putting the brakes on the mayor's legacy project would do just that.
The Crain's report underscores our critique of Crain's columnist Greg David's observations that the mayor selection of Related to co-develop the Hunters Point site indicates that, "Let's accept the administration's position that Related and its partners offered the best proposal. It is also clear that this is a message that Related will not be penalized for doing business with Walmart."
But as we pointed out-and as today's Crain's report bolsters-all the Related selection indicates is that the Bloombergistas will still favor the company in any and all circumstances; but the mayor isn't the whole ball of wax by any means:
"Who in their right mind would have ever thought that Mike Bloomberg would act as a Walmart retardant mayor? If there would be any impediment to a developer, it would have to come at the city council-which last we heard still has oversight over the city's land use process.
But the really risible observation from David is that the selection of Related for a city development has any more meaning beyond the fact the the city has dropped its draws for this company ever since Deputy Dan Doctoroff (a good pal of Related CEO Steve Ross) deeded over Bradhurst Avenue development and the Bronx Terminal Market to Related (without any competitive bid in the latter case)."
What we are beginning to see is how other power centers are being engaged to challenge Related's scope of action-and it would do David well to remember that Related has less than a three year run left with Uncle Mike: "The Walmarts of the world may think they can ignore us, but the Relateds of the world can't,” state Sen. Diane Savino, D-Staten Island, told Crain's last month. “These are guys who want to develop in other places in the city. They could find that their relationship with Walmart may permanently damage their relationship with the city.”
Which brings our attention to Willets Point-and, as we have observed, the development could very well become a future Walmart site since the council, just as it did in Gateway II, failed to restrict the kinds of permissible uses at the site: "Opponents believe they have leverage over Related in part because it is one of 29 firms that have expressed interest in redeveloping Willets Point, a run-down section of northeast Queens slated to be remade with retail outlets, housing, a hotel and office space. The city will issue a request for proposals for the redevelopment in April. On Monday, three elected officials who represent the Willets Point area—Councilwoman Julissa Ferreras, state Sen. José Peralta and Assemblyman Francisco Moya—will send a letter to Related Chief Executive Stephen Ross, pressuring him to shun Walmart."
The letter, however, lacks real teeth: "We have a long working relationship together, creating new economic opportunities for New Yorkers and building more vibrant neighborhoods, and we hope to continue that strong partnership moving forward, perhaps at Willets Point,” reads the letter, a copy of which was provided to Crain's by the Walmart Free NYC coalition. “That's why we're urging you not to do business with Walmart at Gateway II or any other New York City location.”
But, as we have pointed out, the area elected officials do have some stronger medicine in regards to the future of Willets Point. As we indicate on the blog this morning, EDC is operating in an extra-legal manner to circumvent city council oversight and appropriate SEQR review on the Iron Triangle site.
Put simply, EDC is developing a 20 acre Phase I at Willets Point without building requisite ramps off of the Van Wyck that would mitigate the traffic generated. In addition, they have not deigned to indicate what will be the uses developed on this initial phase-and it is a short step towards realizing that Walmart or any large box store uses could easily fit in this first phase of development.
EDC's own traffic consultants, however, estimated that the project would generate 80,000 new car trips a day-much of this from the projected retail uses slated for the new development. If the lion's share of these uses are placed in the first phase, EDC has no justification not proceeding with the ramp approval process-before going ahead with condemning 53 small businesses at Willets Point. It told the council specifically that it would not do this-making Willets Point, like Gateway II, a perfect place for the city's (and the developer's) bait and switch.
A forceful collective response to the city on this dishonest attempt to end run proper review procedures-and a resultant restrictive covenant on the Willets Point site, would make the council players in the Gateway debate as well. The council needs to establish the fact that it has a strong hole card in this game of high stakes development poker-and putting the brakes on the mayor's legacy project would do just that.
Friday, July 24, 2009
Fire in the Hole
When the folks voted to install Mike Bloomberg as their mayor-and did it a second time-the prevailing wisdom was that, owing to the mayor's vast fortune, the public could count on a corruption-free mayoralty. What was not taken into consideration, was the Bloomberg old boys network that gave Dan Doctoroff and the Related Companies to NYC. As a result of this, we were able to bear witness to a whole series of sweetheart no-bid deals that left the city less well off than it should have been.
We have, of course, outlined a few of these deals-most notably the gifting of the Bronx Terminal Market by Docotroff to his old friend and business associate Steve Ross. On a lesser scale, Doctoroff stabbed the Fernandez brothers in the back over the development rights to a project in Harlem on Bradhurst Avenue-subsidizing the project with an additional $5 million after the Related folks, under the Giuliani regime, had been issued two non performance letters, and were on the verge of being de-designated.
But now comes something even more egregious-and coming from our vantage point, with our bug up the butt view of the Bronx Terminal deal, this says quite a lot. It involves the mayor's culpability in the Deutsche Bank fire; and the role played by sweetheart contractor Bovis.
Wayne Barrett has outlined the shamefulness of all that has transpired-a shame that is magnified by the failure of the local press to properly tar baby the mayor on this issue: "The Voice's cover story this week, "Bloomberg's Biggest Scandal--the Deutsche Bank Fire--Should Be His Downfall" -- examined the determination of top city officials, including Bloomberg's longtime top deputy Dan Doctoroff, to ignore the risk of installing Bovis Lend Lease and its prime subcontractor Galt at the demolition site of the bank building. Doctoroff brushed aside warnings from the city's investigations department about Galt in deference to Bovis' reckless desire to hire the mob-tainted firm."
Let's not forget that two firefighters were killed as a result of the city's actions here: "Manhattan DA Robert Morgenthau has indicted Galt and two of its officials in the negligent homicide case involving the death of two firefighters, Robert Beddia and Joseph Graffagnino, at the bank site. He also charged one Bovis employee, but said he did not indict Bovis because it could have caused the collapse of a company that employs thousands."
And, as Barrett has told us, not a single paper has even bothered to call for the removal of the fire commissioner-an incompetent administrator with no fire fighting expertise, whose claim to fame involved a see no evil approach to child abuse when he was in charge of Administration for Children’s Services (ACS).
The question with all of this is why did the city promote Bovis-and who was responsible for the shilling of a failed company? As Barrett points out, Deputy Dan was in the middle of this mess as well: "At the very moment that Doctoroff and the LMDC went ahead with the Bovis contract at the bank site in 2005, the company was engaged in what city attorneys call now "repeated failures to perform in accordance" with "generally accepted professional standards" in the construction of the $275 million Bronx Hall of Justice, the 10-story courthouse that Bovis completed almost three years late. The lawsuit is still pending."
All of which underscores that the Bloomberg administration has been rife with incompetence and cronyism-and his billionaire brothers in the press have been covering for him. We have been particularly curious about why the Post's Murdoch has been such a mayoral toady-after all, the paper has an ideological view of the world that's diametrically opposed to the one espoused by the Nanny mayor.
In response to our query on this, Barrett referred us to his magnum opus of last year on Bloomberg: "In 2007, Bloomberg L.P. decided, apparently after some consideration, not to compete with Murdoch for The Wall Street Journal. Murdoch similarly decided this July not to compete with Bloomberg when he paid $4.5 billion to buy Merrill Lynch's 20 percent interest in Bloomberg L.P. In this walled-off billionaire playground, it's impossible to tell if any of these third-term mogul endorsements spring in part from a business motive."
Bloomberg's purchase of the Wall Street Journal would have given him a virtual monopoly over the financial news in this country-and would have been a great business move. His demurral in going after the WSJ was a god send to Murdoch; and saved him millions from having to match a competitive bid in the process. Gratitude can take many forms.
So we are left to blog flogging Bloomberg in the absence of any real credible journalistic accountability. After all, if the Post can obsessively call for mayoral control on a daily basis, how about banging away at the incompetence of Scoppetta-and the man who refuses to fire him? And while they're at it, let's see if the investigation of the Bloomberg/Bovis nexus is picked up by the intrepid NY Times investigating unit.
Don't hold your breathe. We have a one party town in NYC-and it ain't the Democratic Party that's in charge, it's the Plutocrats; and in the process, vital information necessary for an informed citizenry is being actively suppressed.
We have, of course, outlined a few of these deals-most notably the gifting of the Bronx Terminal Market by Docotroff to his old friend and business associate Steve Ross. On a lesser scale, Doctoroff stabbed the Fernandez brothers in the back over the development rights to a project in Harlem on Bradhurst Avenue-subsidizing the project with an additional $5 million after the Related folks, under the Giuliani regime, had been issued two non performance letters, and were on the verge of being de-designated.
But now comes something even more egregious-and coming from our vantage point, with our bug up the butt view of the Bronx Terminal deal, this says quite a lot. It involves the mayor's culpability in the Deutsche Bank fire; and the role played by sweetheart contractor Bovis.
Wayne Barrett has outlined the shamefulness of all that has transpired-a shame that is magnified by the failure of the local press to properly tar baby the mayor on this issue: "The Voice's cover story this week, "Bloomberg's Biggest Scandal--the Deutsche Bank Fire--Should Be His Downfall" -- examined the determination of top city officials, including Bloomberg's longtime top deputy Dan Doctoroff, to ignore the risk of installing Bovis Lend Lease and its prime subcontractor Galt at the demolition site of the bank building. Doctoroff brushed aside warnings from the city's investigations department about Galt in deference to Bovis' reckless desire to hire the mob-tainted firm."
Let's not forget that two firefighters were killed as a result of the city's actions here: "Manhattan DA Robert Morgenthau has indicted Galt and two of its officials in the negligent homicide case involving the death of two firefighters, Robert Beddia and Joseph Graffagnino, at the bank site. He also charged one Bovis employee, but said he did not indict Bovis because it could have caused the collapse of a company that employs thousands."
And, as Barrett has told us, not a single paper has even bothered to call for the removal of the fire commissioner-an incompetent administrator with no fire fighting expertise, whose claim to fame involved a see no evil approach to child abuse when he was in charge of Administration for Children’s Services (ACS).
The question with all of this is why did the city promote Bovis-and who was responsible for the shilling of a failed company? As Barrett points out, Deputy Dan was in the middle of this mess as well: "At the very moment that Doctoroff and the LMDC went ahead with the Bovis contract at the bank site in 2005, the company was engaged in what city attorneys call now "repeated failures to perform in accordance" with "generally accepted professional standards" in the construction of the $275 million Bronx Hall of Justice, the 10-story courthouse that Bovis completed almost three years late. The lawsuit is still pending."
All of which underscores that the Bloomberg administration has been rife with incompetence and cronyism-and his billionaire brothers in the press have been covering for him. We have been particularly curious about why the Post's Murdoch has been such a mayoral toady-after all, the paper has an ideological view of the world that's diametrically opposed to the one espoused by the Nanny mayor.
In response to our query on this, Barrett referred us to his magnum opus of last year on Bloomberg: "In 2007, Bloomberg L.P. decided, apparently after some consideration, not to compete with Murdoch for The Wall Street Journal. Murdoch similarly decided this July not to compete with Bloomberg when he paid $4.5 billion to buy Merrill Lynch's 20 percent interest in Bloomberg L.P. In this walled-off billionaire playground, it's impossible to tell if any of these third-term mogul endorsements spring in part from a business motive."
Bloomberg's purchase of the Wall Street Journal would have given him a virtual monopoly over the financial news in this country-and would have been a great business move. His demurral in going after the WSJ was a god send to Murdoch; and saved him millions from having to match a competitive bid in the process. Gratitude can take many forms.
So we are left to blog flogging Bloomberg in the absence of any real credible journalistic accountability. After all, if the Post can obsessively call for mayoral control on a daily basis, how about banging away at the incompetence of Scoppetta-and the man who refuses to fire him? And while they're at it, let's see if the investigation of the Bloomberg/Bovis nexus is picked up by the intrepid NY Times investigating unit.
Don't hold your breathe. We have a one party town in NYC-and it ain't the Democratic Party that's in charge, it's the Plutocrats; and in the process, vital information necessary for an informed citizenry is being actively suppressed.
Thursday, August 13, 2009
Related To Whom?
A developer of a different mall in Kingsbridge has a legitimate complaint-and people should be paying attention to the Cerruzzi Holdings folks when they talk about the sweetheart deal that the city gave to Related to build its mall at the Kingsbridge Armory: "The developer seeking to make a mall out of a city-owned Kingsbridge parking lot wants to renegotiate the price with the city in part because The Related Companies got such a good deal for the Kingsbridge Armory, according to a source briefed by a developer’s representative."
But before the city begins discounting all of its property deals, maybe it needs to examine-or, perhaps, Bill Thompson should examine-just how it is that the Related Company gets to be treated so deferentially: "Related will pay $5 million for the landmark 600,000-square-foot Kingsbridge Armory, if what is now a preliminary deal is approved. It will also receive about $20 million in tax breaks. Related has told the city it estimates the Armory will cost nearly $324 million to redevelop."
Or, as Yogi Berra once said, "It's déjà vu all over again." This theft of city property is a repeat of the sweetheart deal that the city, courtesy of Dan Doctoroff, gave to Related to build the Gateway Mall-property that to this day is paying the city less in rent than the 21 ousted wholesale merchants were forking over; up until the day that they were evicted to make room for giant retailers who are currently sucking the life blood out of the surrounding neighborhood shopping districts.
In our view, it's always a bad idea to subsidize mega retail-but especially so when the neighborhoods are under siege and store closings are as rampant as they are today. As we have said before, retail jobs in new malls are simply cannibalized from existing stores-whose taxes are being used to subsidize the mall developers. Invariably, these new jobs are at the lowest rung of the ladder and the subsidies make little economic sense.
What does make sense, and the Ceruzzi complaint dramatizes this, is the pattern of subsidies that have been proffered to one favored developer-and the sense made is that it underscores the kind of patricianage that the Bloomberg administration has exhibited for eight years; highlighting how corruption doesn't have to be manifested in blatant bribery, but can be seen in how old boys networks are used.
Further, it is also likely that Related, like the favored pigs at the city trough that they are, will be back for more tax payer dollars when they find that it is difficult to attract all of the national retailers that they want in the Armory. The additional subsidies-like those that were used by Related at Bradhurst-will be used to lower the rent for big chains, creating even greater inequities, and further endangering struggling local stores.
So the city should tell Ceruzzi to take a hike if it can't afford to develop their parking lot in Kingsbridge. However, the city council should be examining the Armory deal with a fine tooth comb; and if it includes a supermarket and dead end retail jobs, why then it should say that we have already been generous to Related to a fault; and any additional subsidies should come directly from Bloomberg's and Doctoroff's pockets. The taxpayers have been bled enough by this gang of thieves.
But before the city begins discounting all of its property deals, maybe it needs to examine-or, perhaps, Bill Thompson should examine-just how it is that the Related Company gets to be treated so deferentially: "Related will pay $5 million for the landmark 600,000-square-foot Kingsbridge Armory, if what is now a preliminary deal is approved. It will also receive about $20 million in tax breaks. Related has told the city it estimates the Armory will cost nearly $324 million to redevelop."
Or, as Yogi Berra once said, "It's déjà vu all over again." This theft of city property is a repeat of the sweetheart deal that the city, courtesy of Dan Doctoroff, gave to Related to build the Gateway Mall-property that to this day is paying the city less in rent than the 21 ousted wholesale merchants were forking over; up until the day that they were evicted to make room for giant retailers who are currently sucking the life blood out of the surrounding neighborhood shopping districts.
In our view, it's always a bad idea to subsidize mega retail-but especially so when the neighborhoods are under siege and store closings are as rampant as they are today. As we have said before, retail jobs in new malls are simply cannibalized from existing stores-whose taxes are being used to subsidize the mall developers. Invariably, these new jobs are at the lowest rung of the ladder and the subsidies make little economic sense.
What does make sense, and the Ceruzzi complaint dramatizes this, is the pattern of subsidies that have been proffered to one favored developer-and the sense made is that it underscores the kind of patricianage that the Bloomberg administration has exhibited for eight years; highlighting how corruption doesn't have to be manifested in blatant bribery, but can be seen in how old boys networks are used.
Further, it is also likely that Related, like the favored pigs at the city trough that they are, will be back for more tax payer dollars when they find that it is difficult to attract all of the national retailers that they want in the Armory. The additional subsidies-like those that were used by Related at Bradhurst-will be used to lower the rent for big chains, creating even greater inequities, and further endangering struggling local stores.
So the city should tell Ceruzzi to take a hike if it can't afford to develop their parking lot in Kingsbridge. However, the city council should be examining the Armory deal with a fine tooth comb; and if it includes a supermarket and dead end retail jobs, why then it should say that we have already been generous to Related to a fault; and any additional subsidies should come directly from Bloomberg's and Doctoroff's pockets. The taxpayers have been bled enough by this gang of thieves.
Wednesday, June 11, 2008
Small Business Sham
In this week's Village Voice, the paper's Wayne Barrett devastates the Bloomberg record on women and minority-owned businesses, with a full evaluation of the shameful record of Commissioner Rob Walsh. The context of the article is the record percentages of voters Bloomberg achieved among Blacks and Hispanics, and the meager results of programs touted by Bloomberg during his 2005 campaign: "These signature programs—touted in the campaign's radio and television ads—have since disappeared from both the public's consciousness and the mayor's agenda. Bloomberg issued a "Campaign Accountability Report" last year, claiming success in 96 of the 100 promises he'd made in 2005. That list of campaign pledges did not include the MWBE or construction- apprenticeship initiatives."
This shouldn't really surprise anyone, since Walsh's agency has never done a damn thing for small and minority business and, on the contrary, has been the active catalyst for their demise-witness the SBS role in the eviction of the merchants from the Bronx Terminal Market, and his midwifing of IKEA to the detriment of the retailers in Sunset Park. And as far as Bloomberg is concerned, Black and Hispanic businesses are expendable, just ask all of those firms at Willets Point that the mayor's looking to give the heave-ho to.
Of course, as we have commented, all of this has not really been scrutinized by a supine press. As Barrett points out quoting Freddy Ferrar: "Ferrer, who dropped out of politics and now works for a private public-relations firm, tells the Voice that these programs "are only successful in the eyes of the initiator." The former Bronx borough president insists that "if it were anyone else, there would be much more accountability on these promises," and he also decries the media "quiescence" that has selectively protected the Bloomberg administration. "I have never seen it so still," he says, contrasting the media's lack of penetrating questions about Bloomberg's second-term record with the coverage of his three immediate predecessors: Giuliani, David Dinkins, and Ed Koch."
Our problem with this transcends the contracting charade and Walsh's evident obsession with his soft ball team. The tone and tenor of the Bloomberg administration was set in 2002 when the Fernandez brothers were by-passed by Dan Doctoroff on the Bradhurst project in Harlem for his friend Steve Ross, Since then, the Related Company and Vornado Realty have been living large, with no attempt to reach out to qualified minority firms.
But why should Bloomberg when existing minority businesses are being trampled by the mayor's development policies? Here' the money quote: "Robert Walsh, who has run SBS since Bloomberg took office, conceded during a three-hour Voice interview that he hasn't had a single meeting with the mayor to discuss the MWBE program since the new law went into effect in late 2005. He also acknowledged that, from the beginning of the administration, his conversations with Bloomberg about aiding small businesses "had not been focused on gender or race." Asked if they'd ever had a conversation in which Bloomberg gave him "a sense of how important an MWBE program was to him," Walsh replied: "I don't want to put words in anybody's mouth. I can't remember a conversation like that."
Hats off to Barrett. As we have said, the real hard looks at Bloomberg have started to come, and this Voice piece, coming as it does from one of the mayor's staunchest defenders, is truly devastating, Councilman James Sanders' commentary on Walsh's failures to achieve anything positive for minority contractors should serve as an epitaph for Bloomberg's appear to be good administration: "He contends that the failure of SBS "to enforce the rule of law and economic justice as far as MWBEs are concerned is at best a dereliction of duty, and at worst a failure of character."
This shouldn't really surprise anyone, since Walsh's agency has never done a damn thing for small and minority business and, on the contrary, has been the active catalyst for their demise-witness the SBS role in the eviction of the merchants from the Bronx Terminal Market, and his midwifing of IKEA to the detriment of the retailers in Sunset Park. And as far as Bloomberg is concerned, Black and Hispanic businesses are expendable, just ask all of those firms at Willets Point that the mayor's looking to give the heave-ho to.
Of course, as we have commented, all of this has not really been scrutinized by a supine press. As Barrett points out quoting Freddy Ferrar: "Ferrer, who dropped out of politics and now works for a private public-relations firm, tells the Voice that these programs "are only successful in the eyes of the initiator." The former Bronx borough president insists that "if it were anyone else, there would be much more accountability on these promises," and he also decries the media "quiescence" that has selectively protected the Bloomberg administration. "I have never seen it so still," he says, contrasting the media's lack of penetrating questions about Bloomberg's second-term record with the coverage of his three immediate predecessors: Giuliani, David Dinkins, and Ed Koch."
Our problem with this transcends the contracting charade and Walsh's evident obsession with his soft ball team. The tone and tenor of the Bloomberg administration was set in 2002 when the Fernandez brothers were by-passed by Dan Doctoroff on the Bradhurst project in Harlem for his friend Steve Ross, Since then, the Related Company and Vornado Realty have been living large, with no attempt to reach out to qualified minority firms.
But why should Bloomberg when existing minority businesses are being trampled by the mayor's development policies? Here' the money quote: "Robert Walsh, who has run SBS since Bloomberg took office, conceded during a three-hour Voice interview that he hasn't had a single meeting with the mayor to discuss the MWBE program since the new law went into effect in late 2005. He also acknowledged that, from the beginning of the administration, his conversations with Bloomberg about aiding small businesses "had not been focused on gender or race." Asked if they'd ever had a conversation in which Bloomberg gave him "a sense of how important an MWBE program was to him," Walsh replied: "I don't want to put words in anybody's mouth. I can't remember a conversation like that."
Hats off to Barrett. As we have said, the real hard looks at Bloomberg have started to come, and this Voice piece, coming as it does from one of the mayor's staunchest defenders, is truly devastating, Councilman James Sanders' commentary on Walsh's failures to achieve anything positive for minority contractors should serve as an epitaph for Bloomberg's appear to be good administration: "He contends that the failure of SBS "to enforce the rule of law and economic justice as far as MWBEs are concerned is at best a dereliction of duty, and at worst a failure of character."
Thursday, April 09, 2009
IDA: Badly in Need of Reform
NYC hands out huge IDA benefits, generally to large companies that would probably be able to move forward without the city's help. The latest such example is Manhattan Beer's IDA application for a warehouse it wants to build in the Bronx. Suffice it to say, that we will be holding no fundraisers for Simon Bergson and his extremely successful distribution business:
"The Company services over 24,000 accounts in fifteen counties in New York State and employ more than 1,400 people during the peak summer months. Manhattan Beer operates out of approximately 1.2 million square feet of warehousing space, with locations strategically located throughout its distribution area. The Company has increased its volume growth by 88% over the past 10 years and is continuing its expansion. Manhattan Beer is seeking a new distribution center to target its ever expanding clientele in Manhattan and the Bronx."
No charity case here. Basically Manhattan Beer holds a monopoly over the distribution of hot beers such as Coors and Corona and, due to the concentration in both production and distribution of malt beverages, it is able to operate with significant profit margins-while, at the same time, its customers, the bodegas and neighborhood supermarkets, are suffering without any hope for relief from the public sector.
So how much are we the public in for? Here's the damage: "Costs to City: New York City taxes to be exempted:
Mortgage Recording Tax: $ 316,388
Sales Tax Exemption 109,000
Building Tax Exemption (NPV, 25 years) 8,125,352
Land Tax Abatement (NPV, 25 years): 831,425
Maximum Total: $ 9,382,165"
"The Company services over 24,000 accounts in fifteen counties in New York State and employ more than 1,400 people during the peak summer months. Manhattan Beer operates out of approximately 1.2 million square feet of warehousing space, with locations strategically located throughout its distribution area. The Company has increased its volume growth by 88% over the past 10 years and is continuing its expansion. Manhattan Beer is seeking a new distribution center to target its ever expanding clientele in Manhattan and the Bronx."
No charity case here. Basically Manhattan Beer holds a monopoly over the distribution of hot beers such as Coors and Corona and, due to the concentration in both production and distribution of malt beverages, it is able to operate with significant profit margins-while, at the same time, its customers, the bodegas and neighborhood supermarkets, are suffering without any hope for relief from the public sector.
So how much are we the public in for? Here's the damage: "Costs to City: New York City taxes to be exempted:
Mortgage Recording Tax: $ 316,388
Sales Tax Exemption 109,000
Building Tax Exemption (NPV, 25 years) 8,125,352
Land Tax Abatement (NPV, 25 years): 831,425
Maximum Total: $ 9,382,165"
But don't go expecting that the price of a six pack of your Corona will be reduced-or even that it will stay at current price levels. That's because these IDA bennies come with virtually no give backs to the tax payers that are forced to pony up; and there's little apparent due diligence investigating whether, absent the public money, a company like Manhattan Beer would refuse to build. To us, this is corporate welfare in its most egregious form.
Which brings us to the situation over at the Kingsbridge Armory, where Related Companies are in line for a sweet IDA boost: "Yet another developer in New York City is asking for millions of dollars in tax exemptions. On March 5, the Related Companies will ask the New York City Industrial Development Agency (IDA) for a huge tax break to redevelop the Kingsbridge Armory. The company is actively refusing to negotiate with the Bronx community and guarantee basic outcomes, such as good, living wage jobs for local residents, vital community space and quality retail shopping opportunities."
Now Related has been the most favored of all NYC developers-having been handed over the development rights to the old Bronx Terminal Market for seemingly less money than Peter Stuyvesant gave the Indians for the island of Manhattan. And when it couldn't live up to its bid on the Bradhurst Development project, the Bloombergistas salted the deal with an additional $5 million subsidy.
But most egregiously, these awards are given with no strings attached; and, as the Norwood News points out, Related got the IDA monies with no requirement that it provide living wages to the employees that will be working at the Armory retailers. As the leaders of KARA, the community coalition fighting for a meaningful CBA from Related, told the Norwood readers: "At the hearing on March 5, members of the IDA will discuss Related Companies’ application for more than $13 million in tax exemptions for the Armory project. We believe that these tax exemptions should be considered only if the Related Companies sits down with our coalition to negotiate community benefits for the Bronx. Our elected officials should also support our call for a Community Benefits Agreement in exchange for any tax breaks."
And this sentiment was echoed by Stuart Appelbaum, the president of the Retail, Wholesale, Department Store Union in his testimony before the IDA board: "Let me be more clear – the coalition that I stand with today wants this development to happen, but it must happen in a way that not only profits the developer, but serves the needs of the Bronx community. Unless we have guarantees that this development will be an economic opportunity for workers and residents in the Bronx, we cannot justify millions of dollars in tax exemptions for the project."
But the pleas of Appelbaum and the community fell on deaf ears-and the IDA benefits were awarded in carte blanche fashion: "When it was time to vote, all but two board members, Comptroller Thompson and Manhattan Borough President Stringer, voted in favor of giving Related $17.8 million in tax breaks."
So, enough is enough. Clearly, we have an IDA process that's badly in need of reform. Which is why a coalition of groups has come together to reform the IDA process. As one of the group's leaders says: "Just as importantly, these programs must require businesses that benefit from IDA tax breaks to pay fair wages to their employees. New York’s families should not be forced to tap already depleted Medicaid or welfare programs, at the expense of taxpayers, when they are working for companies that benefit from these tax breaks."
A bill to do just that has passed a senate committee and deserves to be swiftly passed so that the corporate giveaways can be reformed in favor of rank and file workers that are too often exploited by retailers who are occupying land that has been developed through generous tax subsidies. Here's what the bill's original sponsors have said: "“Companies should not be getting tax breaks to create jobs that pay so little that the people who get the jobs are eligible for public programs like Medicaid or food stamps,” said Senate Labor Committee Chair George D. Maziarz (R-Newfane), sponsor of the legislation in the Senate. “When we give tax breaks, or other subsidies, we should make sure our communities are benefiting from them.”
And when we award a tax subsidy, the awarding agency usually details what it claims are the collateral benefits-jobs, tax revenues, etc.-that the project will generate. There is, however, no requirement for the subsidizers to gauge the project's collateral damages. And in the Armory's case, if Related decides to put a food use into its mall, there will be a considerable negative impact on the contiguous neighborhood supermarket-a store that has been in the community for over fifty years! Does it make any sense, let alone is it equitable, for the city to subsidize uses that will put existing tax paying businesses at risk? The entire process is badly in need of an overhaul.
Now that the Democrats have taken control of the senate, the IDA reforms are thankfully closer to fruition. All we can say is, that it's about time for a change.
Wednesday, July 26, 2006
Going Uptown?
As we have mentioned before, the decision by the Bloomberg administration to pull the plug on the Uptown USA project in response to community opposition was a definite first for the mayor and his economic development team. EDC listened carefully to the folks who were concerned with both the size and the scope of the plan.
Now, however, it is up to EDC, Councilwoman Mark and BP Stringer to help craft a plan that will more clearly reflect the needs of the local community. It seems to us that part of this new plan needs to be the inclusion of local businesses and, possibly, a minority development team. Ever since EDC scuttled the efforts to include the Fernandez brothers on the Bradhurst site at 145th Street we've been waiting to see if any attempt would be made to increase the role of minority firms in the city's economic development plans.
So far not much has happened in this area and what we've seen is best described as "patricianage," the aggrandizement of well-heeled developers and the failure to include the new set of minority entrepreneurs that are waiting at the gate. Uptown would be a great place to "set aside" the patricianage trend.
Now, however, it is up to EDC, Councilwoman Mark and BP Stringer to help craft a plan that will more clearly reflect the needs of the local community. It seems to us that part of this new plan needs to be the inclusion of local businesses and, possibly, a minority development team. Ever since EDC scuttled the efforts to include the Fernandez brothers on the Bradhurst site at 145th Street we've been waiting to see if any attempt would be made to increase the role of minority firms in the city's economic development plans.
So far not much has happened in this area and what we've seen is best described as "patricianage," the aggrandizement of well-heeled developers and the failure to include the new set of minority entrepreneurs that are waiting at the gate. Uptown would be a great place to "set aside" the patricianage trend.
Monday, October 24, 2005
NY Times Nails BTM "Sweetheart Deal"
In today's NY Times Charles Bagli and Robin Shulman provide their readers with an exhaustive evaluation of the development deal that brought the Related Companies into the Bronx Terminal Market. The long and thoroughly researched piece lays bare the role played by Deputy Mayor Dan Doctoroff in paving the way for his friend Steve Ross to not only get hold of the site without the benefit of an open competitive bid but to also avail his company of public benefits that the Times reports as unprecedented in the city's history:
The city often provides developers in struggling neighborhoods with incentives, including low-interest loans, tax-free bonds and tax breaks. In addition to tax breaks, Related is getting more than $14 million in cash grants that a similar project in Harlem did not get, as well as the equivalent of a money-back guarantee if the developer fails to get the zoning he says he needs. That benefit, Andrew Alper, president of the city's Economic Development Corporation, acknowledged was unusual and possibly unprecedented.Our comments here will be followed with a more in-depth evaluation of the story and the status of the BTM at the present time. Suffice it to say, however, that the Times piece lays bare the utter mendaciousness of the Deputy Mayor who had supposedly voluntarily recused himself from any dealings with his old buddy Ross. With an appropriate acknowledgement of Tom Robbins's original Village Voice story the Times depicts how Doctoroff spent hours discussing the BTM deal with the appointed mediator as well as his buddy Steve (along with lengthy e-mails back and forth):
Still, as The Village Voice first reported, Mr. Doctoroff's meeting and telephone logs show he closely followed the Terminal Market talks, meeting at least eight times with the mediator, Richard Ravitch, or members of his staff working on the deal. He also met frequently with Mr. Ross and talked to him by telephone, although the logs do not indicate the subject of their discussions.What the story reveals is that when it comes to economic development the claims of Mike Bloomberg that he is above special interests turns out to be blatantly false (unless Doctoroff is to be considered a free agent). The collusion between the two old friends, a collusion that began with Deputy Dan's intervention on behalf of Related in 2002 on the Bradhurst project in Harlem, is an ongoing one and can be seen in a number of other projects all over the city. It is just the kind of special interest favoritism that cries out for an independent investigation.
City officials working under Mr. Doctoroff were not passive spectators to the deal; they had to approve the transfer of the lease from Mr. Buntzman to Related and the benefit package for the developer.
"It had to be a three-party deal," said Jeffrey Blau, a top executive at Related. "The city had the right to approve any transfers of the lease."
One of the missing pieces in the Times story (can we get a sequel?) is an examination of the legality of the evictions of the merchants. It is our contention that the evictions are patently illegal and, hopefully, that is just what Judge Cahn will decide in the court case.
Hail To Helen Diane Foster
We would be utterly remiss if we failed to give ultimate props to Councilmember Foster who righteously stood up for justice and defended the market merchants:
Helen Diane Foster, a City Council member from the Bronx, has criticized the city's effort to evict the market's two dozen Caribbean, African and Central American wholesale produce merchants. Ms. Foster, whose family used to buy its Christmas tree there and whose father bought produce and provisions for his restaurant at the market, said, "While we need economic development, I don't know that we need it at the expense of the merchants."Our praise for Helen in no way diminishes our sincere gratitude to the pioneering role of Councilmember Monseratte in the BTM case (Hiram is so active and generally fearless that we often do take him for granted. His willingness to take a stand is absolutely vital to the small businesses that he so often champions). It goes without saying, however, that Foster's stand as a Bronx official is a profile in courage.
"An even larger issue is how the deal was cut," she said.
Friday, October 21, 2005
Where There's Smoke, Sometimes There's, Well, Smoke
In today's Daily News Errol Louis hits on some human rights themes two of which, minority contracting and the racial composition of the FDNY, deserve a comment or two. As far as the contracting issue we think that Louis is right on point. We all welcome the mayor's election year recognition of the racial disparities in the awarding of contracts to minority firms but as we have said before this recognition needs to lead to real empowerment and not booty-crumb capitalism that, while giving minority contractors some secondary work, continues to give the real benefits to all of the usual suspects.
The poster child of this issue is of course the Fernandez brothers who were passed over on the Bradhurst supermarket development by Deputy Dan in favor of his friend Steve Ross of the Related Companies. The brothers, heads of a $50+ million business are still waiting for the "partnership" that Dan promised them when he cavalierly passed them over.
As far as the FDNY is concerned the issue may be a bit more complicated. While the agency remains heavily white, the actions of the firefighters in the performance of their duties has always been heroic and color-blind. It is the only city service whose best practitioners vie for placements in the city's toughest neighborhoods (compare this to teachers with seniority who look to transfer out as soon as they can).
So while the issue of the composition of the force needs to be addressed it should not be done so in any spirit of malice. We need to come up with better recruitment methods and uncover the reasons for the failure of previous efforts. The entire issue shouldn't be seen through the prism of 1950's Southern-style racism. This will only complicate things without leading to any positive changes. What should be avoided at all costs are efforts to alter the testing methodologies that would compromise the quality of the firefighting cadres.
The poster child of this issue is of course the Fernandez brothers who were passed over on the Bradhurst supermarket development by Deputy Dan in favor of his friend Steve Ross of the Related Companies. The brothers, heads of a $50+ million business are still waiting for the "partnership" that Dan promised them when he cavalierly passed them over.
As far as the FDNY is concerned the issue may be a bit more complicated. While the agency remains heavily white, the actions of the firefighters in the performance of their duties has always been heroic and color-blind. It is the only city service whose best practitioners vie for placements in the city's toughest neighborhoods (compare this to teachers with seniority who look to transfer out as soon as they can).
So while the issue of the composition of the force needs to be addressed it should not be done so in any spirit of malice. We need to come up with better recruitment methods and uncover the reasons for the failure of previous efforts. The entire issue shouldn't be seen through the prism of 1950's Southern-style racism. This will only complicate things without leading to any positive changes. What should be avoided at all costs are efforts to alter the testing methodologies that would compromise the quality of the firefighting cadres.
Thursday, September 15, 2005
What Freddy Needs to do
The gracious concession of Anthony Weiner clears the way for Freddy Ferrer to immediately concentrate all of his efforts on trying to defeat the billionaire incumbent in November. The task is clearly formidable and will require a great deal of ingenuity and creativity. An orthodox campaign will simply not work. Freddy needs to find ways to throw Bloomberg off balance, force him into situations that require spontaneity, and challenge him in directly personal terms.
In doing so he needs to somehow use the mayor's great wealth, a fortune that he pretty much pledged not to use in his re-election campaign, against him. This strategy, however, can't be employed in any crude redux of the "two cities" theme that was used against Freddy four years ago.
One of the best issues to use in this regard is the BTM eviction of the market merchants and the mayor's promise to do the same to the businesses at Willets Point, where Bloomberg famously remarked that, "the land is too valuable for the businesses that are on it." The issue here is an economic development policy of favoritism for the well-connected and well-heeled.
In the same vein the mayor's response to the complaints of bodegas that the so-called "bodega tax" on tobacco was costing the small neighborhood stores around $250 million a year ("It's a minor economic issue"), points to the same "mind over matter" economic royalist attitude that sees the little guy-small store owner or average citizen- with disdain.
In addition, and Freddy knows this issue really well, the cozy relationship between Doctoroff and Related's Steve Ross can be effectively dramatized and used to symbolize the way that economic development in Mike Bloomberg' world is based on "patricianage". Just as the merchants can be evicted in the BTM, using the pretext of a phony "public market clause", so can the Fernandez brothers be by-passed on Bradhurst Avenue as Doctoroff-Bloomberg push crony aggrandizing deals in the name of economic development.
The entire economic development strategy here rests on mega-developments that overwhelm local communities and push out small businesses. The end result, as published reports show, is the increased poverty rates in NYC that demonstrate how economic progress is far from being a rising tide that lifts all boats.
Of course in this regard the entire debacle on the West Side needs to be re-visited. The more Freddy can make this election about Steve Ross, Steve Roth and Woody Johnson the more he can simultaneously hit out at the mayor's obscene spending levels. How many fire houses and day care centers could be opened with the money the mayor is spending? Why, if he has such a great four year record, does Bloomberg need to spend $100 million to convince the public of what should be self-evident?
In doing so he needs to somehow use the mayor's great wealth, a fortune that he pretty much pledged not to use in his re-election campaign, against him. This strategy, however, can't be employed in any crude redux of the "two cities" theme that was used against Freddy four years ago.
One of the best issues to use in this regard is the BTM eviction of the market merchants and the mayor's promise to do the same to the businesses at Willets Point, where Bloomberg famously remarked that, "the land is too valuable for the businesses that are on it." The issue here is an economic development policy of favoritism for the well-connected and well-heeled.
In the same vein the mayor's response to the complaints of bodegas that the so-called "bodega tax" on tobacco was costing the small neighborhood stores around $250 million a year ("It's a minor economic issue"), points to the same "mind over matter" economic royalist attitude that sees the little guy-small store owner or average citizen- with disdain.
In addition, and Freddy knows this issue really well, the cozy relationship between Doctoroff and Related's Steve Ross can be effectively dramatized and used to symbolize the way that economic development in Mike Bloomberg' world is based on "patricianage". Just as the merchants can be evicted in the BTM, using the pretext of a phony "public market clause", so can the Fernandez brothers be by-passed on Bradhurst Avenue as Doctoroff-Bloomberg push crony aggrandizing deals in the name of economic development.
The entire economic development strategy here rests on mega-developments that overwhelm local communities and push out small businesses. The end result, as published reports show, is the increased poverty rates in NYC that demonstrate how economic progress is far from being a rising tide that lifts all boats.
Of course in this regard the entire debacle on the West Side needs to be re-visited. The more Freddy can make this election about Steve Ross, Steve Roth and Woody Johnson the more he can simultaneously hit out at the mayor's obscene spending levels. How many fire houses and day care centers could be opened with the money the mayor is spending? Why, if he has such a great four year record, does Bloomberg need to spend $100 million to convince the public of what should be self-evident?
Wednesday, July 06, 2005
Small Business Afterthought
In all the hoopla of economic renaissance, small business is treated as a tag line in the mayor’s self promotion. We weren’t paying that much attention but we did hear something about the mayor creating a small business investment fund. You’ll notice that all the other breathless announcements were about events already in progress. For small business, after four years, all we get are promises? How lame is that.
More importantly, this fund and similar measures mask the reality of the Bloomberg first term which has been the most anti-small business in 20 years. Here is the reality:
1) Hiked commercial real estate tax (June 2002) – Resulted in 20% + rent increase for all neighborhood stores
2) Garbage rate hike (September 2003) – Increased the cost of disposing “wet” garbage and led to a doubling and even tripling of disposal for all area food stores
3) Cigarette tax (May 2002) – An 1800% tax increase, the largest in city history, has taken over $250 million a year from the coffers of local bodegas, green grocers and newsstands. Local retailers have lost 60% of their sales to the internet and to the black market of street sales. Despite this devastating loss, the mayor characterizes it as a “minor economic issue.”
4) Bodega safety (July 2003) – When a rash of murders targeting bodega owners hit the city the local media was having a field day. In response to the uproar, and after being chided for his cigarette tax, the mayor went to the Bronx and announced “Operacion Tienda Segura” (Operation Safe Store). The NYPD, in response, set up a security camera pilot program for ten stores. Now two years later, with the police reporting a great success with the pilot, no follow up has yet to be seen out of the mayor’s office (Maybe if Ferrer gets closer we’ll start to see more stores put in the program).
5) Mega development – In all of the large scale development small business has been given short shrift. The kicking out of the Bronx Terminal Market merchants and the Willets Point businesses head the list. Less well know, was Deputy Doctoroff’s 2002 decision to award the Bradhurst development to his friend and Related Companies President Steve Ross over local entrepreneurs Mauricio and Matthew Fernandez.
If the mayor wants to do more for small business he can do the honorable thing: get a new Deputy Mayor for Economic Development.
More importantly, this fund and similar measures mask the reality of the Bloomberg first term which has been the most anti-small business in 20 years. Here is the reality:
1) Hiked commercial real estate tax (June 2002) – Resulted in 20% + rent increase for all neighborhood stores
2) Garbage rate hike (September 2003) – Increased the cost of disposing “wet” garbage and led to a doubling and even tripling of disposal for all area food stores
3) Cigarette tax (May 2002) – An 1800% tax increase, the largest in city history, has taken over $250 million a year from the coffers of local bodegas, green grocers and newsstands. Local retailers have lost 60% of their sales to the internet and to the black market of street sales. Despite this devastating loss, the mayor characterizes it as a “minor economic issue.”
4) Bodega safety (July 2003) – When a rash of murders targeting bodega owners hit the city the local media was having a field day. In response to the uproar, and after being chided for his cigarette tax, the mayor went to the Bronx and announced “Operacion Tienda Segura” (Operation Safe Store). The NYPD, in response, set up a security camera pilot program for ten stores. Now two years later, with the police reporting a great success with the pilot, no follow up has yet to be seen out of the mayor’s office (Maybe if Ferrer gets closer we’ll start to see more stores put in the program).
5) Mega development – In all of the large scale development small business has been given short shrift. The kicking out of the Bronx Terminal Market merchants and the Willets Point businesses head the list. Less well know, was Deputy Doctoroff’s 2002 decision to award the Bradhurst development to his friend and Related Companies President Steve Ross over local entrepreneurs Mauricio and Matthew Fernandez.
If the mayor wants to do more for small business he can do the honorable thing: get a new Deputy Mayor for Economic Development.
Wednesday, June 08, 2005
Deputy Dan Doctoroff
We have never been shy about expressing our distaste for the highhanded methods of Deputy Mayor Dan Doctoroff. We were first exposed to his arrogant disdain for those less exalted when only a month and a half in office, he unceremoniously slam dunked Dominican developer Mauricio Fernandez and instead subsidized the installation of his friend Steve Ross into the Bradhurst development at 145th Street in Harlem.
As a result, it should be no surprise to find that the demise of the West Side Stadium and the finger pointing at Deputy Dan only makes us smile. It gives us a certain measure of satisfaction to see others (although mostly quoted anonymously), find out what we had been telling people for a while: Doctoroff exudes a smug haughtiness that has no use for anyone’s opinion but his own.
Ben Smith’s story in this week’s Observer really nails this. He clearly underscores how Dan’s arrogance poisoned the atmosphere and, what’s probably even worse, how his political naiveté led the Bloomberg team directly into an ambush. Politics, unlike investment banking where the monetary clubs are trump (no pun intended), requires some degree of deference to the sensibilities of tenured elected leaders. Clearly, when it comes to tact and deference the Doctoroff budget is full of deficit spending.
Smith Follows Bowles into Overestimation
Ben does, however, fall short in one area. He uncritically cites the outer borough developments as true breakthroughs (“a remarkably dynamic period in city government”). Before we grant the kudos it is important to evaluate the quality of the aforementioned projects and the methods used to achieve them. Bowles, to his credit, offers the nascent critique (top-down cronyism) and Ben needed to pursue this particular line of thinking.
In the end, however, the stadium’s demise may not only have the rebound effect of helping Bloomberg get reelected, it might also lead to the one major reason the mayor’s reelection may be palatable: a second term absent Dan Doctoroff.
As a result, it should be no surprise to find that the demise of the West Side Stadium and the finger pointing at Deputy Dan only makes us smile. It gives us a certain measure of satisfaction to see others (although mostly quoted anonymously), find out what we had been telling people for a while: Doctoroff exudes a smug haughtiness that has no use for anyone’s opinion but his own.
Ben Smith’s story in this week’s Observer really nails this. He clearly underscores how Dan’s arrogance poisoned the atmosphere and, what’s probably even worse, how his political naiveté led the Bloomberg team directly into an ambush. Politics, unlike investment banking where the monetary clubs are trump (no pun intended), requires some degree of deference to the sensibilities of tenured elected leaders. Clearly, when it comes to tact and deference the Doctoroff budget is full of deficit spending.
Smith Follows Bowles into Overestimation
Ben does, however, fall short in one area. He uncritically cites the outer borough developments as true breakthroughs (“a remarkably dynamic period in city government”). Before we grant the kudos it is important to evaluate the quality of the aforementioned projects and the methods used to achieve them. Bowles, to his credit, offers the nascent critique (top-down cronyism) and Ben needed to pursue this particular line of thinking.
In the end, however, the stadium’s demise may not only have the rebound effect of helping Bloomberg get reelected, it might also lead to the one major reason the mayor’s reelection may be palatable: a second term absent Dan Doctoroff.
Tuesday, June 29, 2010
A Good Wager for New York City
If the best revenge is living well, than for those New Yorkers who voted in vain against the mayor’s third term, getting even is getting harder-as this City Room report on the expense of living in NYC makes clear: “For New York City families, increases in the cost of living have far outpaced wages, according to a report to be released Tuesday by a national organization working to advance economic equality for women and their families. The report, known as the Self-Sufficiency Standard for New York City, which is released every five years by the Women’s Center for Education and Career Advancement, compares the amount of money a family needs to make ends meet with the federal poverty level, commonly used to determine whether families receive subsidized housing, food stamps and other supports.”
So, how’s that five borough economic plan of Bloomberg’s working out? The mayor has now had eight and a half years in office, and the lives of many New Yorkers-perhaps a majority-are more untenable than when he first talked about his economic development plans in 2001. The reality is that the Bloomberg model-mega retail developments with poverty wages-has been the worst prescription for economic growth-as the self sufficiency report indicates: “The problem, the report’s authors say, is that only one out of the 10 most common jobs in the city (registered nursing) provide Brooklyn families with adequate income, leaving many to scrape by. “There is a very high level of frustration,” said Merble Reagon, executive director of the Women’s Center for Education and Career Advancement, of the women she counsels, many of whom have hourly jobs that do not have benefits and leave them regularly sacrificing one basic need for another.”
The Bloomberg response? More of the same kind of jobs-and a vicious resistance to the push for a city wide living wage for developments that are tax subsidized by the city. The living wage issue was point-counterpointed in Sunday’s NY Daily News-with Diana Furchtgott-Roth taking the Bloomberg position: “Many Americans are intent on saving money, making every penny count. But in New York City, which faces a predicted operating deficit of $2.8 billion this fiscal year, wasting taxpayer money remains the local sport. New York City is currently considering legislation that will mandate a "living wage" for jobs connected to any new development projects that benefit from city subsidies.”
Wow! DFR believes that, “wasting the tax payer’s money” is a local sport but has nothing to say about the huge corporate welfare giveaways that the Bloombergistas have made into, if not local sport, at least a local art form. And she is mute-struck so, it seems, by the way in which these real estate subsidies have disadvantaged local entrepreneurs in favor of the mayor’s favored cohort of developer billionaires. Gee, we can’t remember DFR saying boo about the complete giveaway of the Bronx Terminal Market-displacing 20 mostly minority distributors-to Steve Ross of Related.
In fact, Bloomberg is so close to these high rollers that he even took time from his hectic golf schedule to advocate for one of Related’s executives before a local co-op board. Yet the aggrandizement of these real estate tycoons is OK with Diana, but the provision of a living wage for a hard pressed citizenry is mocked by this toady to the wealthy.
And she has nothing to say about the Citizens Budget Commission report that found little in the way of justification for the Bloomberg real estate aggrandizement-as we have pointed out before: "But with the city, it's significant that for the largest projects-Coney Island and Willets Point-much of the money currently budgeted is for acquisitions, buying up property that the city doesn't even own. Given that the money goes into the pockets of a few landlords and businesses, it's not stimulating much immediate economic activity. Instead, the city is relying on the hope that the projects will be carried out, eventually."
And, as John Petro argues over at DMI, all that's missing from her analysis is any supporting documentation: "Take Furchtgott-Roth’s piece. The living wage bill will, according to the author: stall development, cause businesses to flee the city, waste taxpayer money, and increase unemployment. Notably absent was any evidence to support these claims."
But Furchtgott-Roth is not without a good sense of humor-or perhaps unintended irony is her métier. Listen to her description of the city’s bidding process: “It makes no sense for the government to award contracts to the high bidder, not the low one. That upside-down logic smacks of waste and corruption. And it means that we'd be taking money out of the pockets of strapped taxpayers, many of whom earn less than the "living wage," so that a select group of unionized workers can make more.”
How about awarding contracts to the no-bidder?-as was the case with Related at the BTM and at the Gateway expansion. Doesn’t that, “smack of corruption,” to our own Princess Di? Or, even better, when Related failed to live up to its bid terms in 2002 at Bradhurst Avenue in Harlem-with a minority competing bidder in the wings-the Bloombergistas (and Deputy Dan Doctoroff in the lead) simply awarded the company an extra subsidy to cover for its failure to comply with the original terms.
This has been the Bloomberg economic development record-and when the projects have been lavishly subsidized, they have been a direct threat to neighborhood businesses like Morton Williams Supermarkets who have never been connected enough to get a dime in public money. It makes you wonder what world Furchtgott-Roth lives in. For her, and the mayor’s amen chorus, subsidizing the very wealthy to provide a poverty wage for workers is sound economics.
But not so much for Robert Pollin, who rebuts DFR in the Daily News counterpoint: “It's hard to take issue with the basic objective behind living wage proposals, which is to ensure that all workers are paid enough to support themselves and their families at a minimally decent standard. The argument for the current New York proposal seems stronger still: In those cases when some businesses get an economic advantage courtesy of the taxpayers, they should especially uphold the community's basic standards of fairness.”
And Pollin goes on to demonstrate that the living wage provision, in spite of its demonization by DFR, doesn’t hurt the developers: “But the facts simply don't support the contention. Businesses subject to living-wage laws have not produced fewer job opportunities for low-wage workers. Research on the Boston measure - a law far broader than what's being considered in New York - found no significant difference in overall hiring levels among firms which were required to follow the living wage law compared to unaffected businesses. The patterns are similar for San Francisco, Los Angeles and Santa Fe.”
Not mentioned by either side of the living wage debate in the News is the manner in which these subsidized projects harm existing local business-or how local business circulates money to a much greater extent and benefit than any of these low wage national chains-a reality that Stacy Mitchell has well documented. So, in our view, if the tax payer money can aggrandize the profits of Steve Ross-a process that we have labeled as, "patrcianage"-it can damn well benefit the retail workers beyond a subsistence wage. It’s the only way that one could possibly justify the subsidy exercise in the first place.
So, how’s that five borough economic plan of Bloomberg’s working out? The mayor has now had eight and a half years in office, and the lives of many New Yorkers-perhaps a majority-are more untenable than when he first talked about his economic development plans in 2001. The reality is that the Bloomberg model-mega retail developments with poverty wages-has been the worst prescription for economic growth-as the self sufficiency report indicates: “The problem, the report’s authors say, is that only one out of the 10 most common jobs in the city (registered nursing) provide Brooklyn families with adequate income, leaving many to scrape by. “There is a very high level of frustration,” said Merble Reagon, executive director of the Women’s Center for Education and Career Advancement, of the women she counsels, many of whom have hourly jobs that do not have benefits and leave them regularly sacrificing one basic need for another.”
The Bloomberg response? More of the same kind of jobs-and a vicious resistance to the push for a city wide living wage for developments that are tax subsidized by the city. The living wage issue was point-counterpointed in Sunday’s NY Daily News-with Diana Furchtgott-Roth taking the Bloomberg position: “Many Americans are intent on saving money, making every penny count. But in New York City, which faces a predicted operating deficit of $2.8 billion this fiscal year, wasting taxpayer money remains the local sport. New York City is currently considering legislation that will mandate a "living wage" for jobs connected to any new development projects that benefit from city subsidies.”
Wow! DFR believes that, “wasting the tax payer’s money” is a local sport but has nothing to say about the huge corporate welfare giveaways that the Bloombergistas have made into, if not local sport, at least a local art form. And she is mute-struck so, it seems, by the way in which these real estate subsidies have disadvantaged local entrepreneurs in favor of the mayor’s favored cohort of developer billionaires. Gee, we can’t remember DFR saying boo about the complete giveaway of the Bronx Terminal Market-displacing 20 mostly minority distributors-to Steve Ross of Related.
In fact, Bloomberg is so close to these high rollers that he even took time from his hectic golf schedule to advocate for one of Related’s executives before a local co-op board. Yet the aggrandizement of these real estate tycoons is OK with Diana, but the provision of a living wage for a hard pressed citizenry is mocked by this toady to the wealthy.
And she has nothing to say about the Citizens Budget Commission report that found little in the way of justification for the Bloomberg real estate aggrandizement-as we have pointed out before: "But with the city, it's significant that for the largest projects-Coney Island and Willets Point-much of the money currently budgeted is for acquisitions, buying up property that the city doesn't even own. Given that the money goes into the pockets of a few landlords and businesses, it's not stimulating much immediate economic activity. Instead, the city is relying on the hope that the projects will be carried out, eventually."
And, as John Petro argues over at DMI, all that's missing from her analysis is any supporting documentation: "Take Furchtgott-Roth’s piece. The living wage bill will, according to the author: stall development, cause businesses to flee the city, waste taxpayer money, and increase unemployment. Notably absent was any evidence to support these claims."
But Furchtgott-Roth is not without a good sense of humor-or perhaps unintended irony is her métier. Listen to her description of the city’s bidding process: “It makes no sense for the government to award contracts to the high bidder, not the low one. That upside-down logic smacks of waste and corruption. And it means that we'd be taking money out of the pockets of strapped taxpayers, many of whom earn less than the "living wage," so that a select group of unionized workers can make more.”
How about awarding contracts to the no-bidder?-as was the case with Related at the BTM and at the Gateway expansion. Doesn’t that, “smack of corruption,” to our own Princess Di? Or, even better, when Related failed to live up to its bid terms in 2002 at Bradhurst Avenue in Harlem-with a minority competing bidder in the wings-the Bloombergistas (and Deputy Dan Doctoroff in the lead) simply awarded the company an extra subsidy to cover for its failure to comply with the original terms.
This has been the Bloomberg economic development record-and when the projects have been lavishly subsidized, they have been a direct threat to neighborhood businesses like Morton Williams Supermarkets who have never been connected enough to get a dime in public money. It makes you wonder what world Furchtgott-Roth lives in. For her, and the mayor’s amen chorus, subsidizing the very wealthy to provide a poverty wage for workers is sound economics.
But not so much for Robert Pollin, who rebuts DFR in the Daily News counterpoint: “It's hard to take issue with the basic objective behind living wage proposals, which is to ensure that all workers are paid enough to support themselves and their families at a minimally decent standard. The argument for the current New York proposal seems stronger still: In those cases when some businesses get an economic advantage courtesy of the taxpayers, they should especially uphold the community's basic standards of fairness.”
And Pollin goes on to demonstrate that the living wage provision, in spite of its demonization by DFR, doesn’t hurt the developers: “But the facts simply don't support the contention. Businesses subject to living-wage laws have not produced fewer job opportunities for low-wage workers. Research on the Boston measure - a law far broader than what's being considered in New York - found no significant difference in overall hiring levels among firms which were required to follow the living wage law compared to unaffected businesses. The patterns are similar for San Francisco, Los Angeles and Santa Fe.”
Not mentioned by either side of the living wage debate in the News is the manner in which these subsidized projects harm existing local business-or how local business circulates money to a much greater extent and benefit than any of these low wage national chains-a reality that Stacy Mitchell has well documented. So, in our view, if the tax payer money can aggrandize the profits of Steve Ross-a process that we have labeled as, "patrcianage"-it can damn well benefit the retail workers beyond a subsistence wage. It’s the only way that one could possibly justify the subsidy exercise in the first place.
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