Thursday, June 30, 2005

Pilots Take Off

The Times and the Sun are reporting that the Mayor has agreed to subject the special revenue source, know as Pilots (Payments in Lieu of Taxes), to City Council oversight. The revenue fund, largely unknown to all but the most wonkish, came into awareness when the mayor was planning to use around $300 million in Pilot funds to finance the decking for the proposed Jets stadium.

Pilots and Bronx Terminal Market Thievery

Pilots are paid instead of direct tax allocations on property that is owned by the city. As Robin Shulman points out in the Times, Pilots:

are typically used to encourage corporations or institutions to build large-scale projects on city-owned land.
If this sounds familiar, it should, since Pilots are also slated to be paid by the Related Companies on the Gateway Project at the Bronx Terminal Market. The City Council hearing on Monday only touched the surface of this blatant theft of city property. On the Gateway deal not only do the Pilots phase in slowly but Related only pays $250,000 a year for the first five years and lease payments cap out at $500,000 a year or 2% of the total leased space.

What does this mean? Well, there will be around 1,000,000 sq. ft. of leasable space at full build out. At an average predicted rental of $40 per sq. ft. this mean Related will be paying the City, at most, $800,000 a year on revenue of $40 million a year.

If you do all of the math here you’ll find that the city would be better off paying Buntzman $40 million to leave and keeping the existing merchants who are paying around $3 million in rent annually. In 13 or 14 years the city does no worse with the “ghetto-dwelling” merchants than it does on the glamorous upscale mall. Does this make any sense?

Where’s the Outrage?

In reviewing the incredible testimony on the Bronx Terminal Market by EDC President Andrew Alper the only question is: Where’s the outrage? Here we have the dollar a year former managing partner of Goldman Sachs basically saying that he negotiated a lease on 1,000,000 sq. ft. of city-owned land on the Bronx waterfront without even appraising the value of the property. Not only that, Alper also admitted, under questioning from Hiram Monseratte, that in the vaunted swap of the Bronx House of Detention for the Olympic velodrome, EDC never appraised the detention facility either.

One thing is abundantly clear. If the old Bronx machine had tried pulling off this kind of deal and had made the ultimate beneficiary of the largesse a close friend of the old county chairman (remember Stanley Friedman?), we can image that the local press would have raised holy hell. What’s different in this situation?

The difference lies in the cast of characters. From the mayor on down to the EDC Chairman, the Masters of the Universe persona rules. These ultra wealthy benefactors, graciously ruling over us for a dollar a year, couldn’t have any untoward or selfish motivation, could they? That is why the incredibly tainted relationship between Deputy Doctoroff and Steve Ross (The University of Michigan’s $100 million man) has not been given the kind of scrutiny that, lets say, Stanley Simon and Wedtech got in the 1980s.

No editorial comment whatsoever about Doctoroff-Ross, even after the huge exposé done by Charles Bagli in the Times? Even Rudy Giuliani wouldn’t have gotten away with transferring property in this manner to one of Ray Harding’s clients.

It is time for the Times and other local papers to start performing the kind of ethical oversight that is necessary for this Bloomberg cohort precisely because of its great wealth. The wealth cultivates a particular kind of noblesse oblige that is fertile grounds for self-serving behavior ultimately not in the interest of the general public. If you feel this is simply overwrought rhetoric then please take a close look at the BTM deal. It is that scandalously bad.

Wednesday, June 29, 2005

Wal-Mart and Crime

Wal-Mart, in part due to its immense inventory and size, is often a magnet for crime. This influx of criminals into a community is certainly worrisome as is the increased need for a neighborhood's police to work on Wal-Mart-related cases. Here are some examples from the past couple of days:

A man suspected in a Wal-Mart shooting shoots himself

Woman Carjacked in Wal-Mart Parking Lot

Convicted Felon Arrested For Violent Wal-Mart Attack

Man Accused Of Molesting 13-Year-Old In Wal-Mart

Bronx Terminal Market Battle Continues

The press continues to focus on the nature of the sweetheart deal Related is enjoying as a result of its charm and good looks (known as “juice" in political parlance). Frank Lombardi highlights some of the hearing testimony but steers clear from some of the most pointed criticism that was offered by Adrian Zuckerman, a lawyer for the merchants.

Gerson Borrero, on the other hand, shows no such reticence in his column today and goes after the deal, the transfer of property, Related's low lease payments and EDC's failure to appraise the value of the land. He is particularly hard on Councilman Joel Rivera for his enthusiastic backing of the project without looking closely at the deal.

On the other hand, we believe that Joel and his father, the County Chairman, will eventually use their influence to resolve the merchant’s plight. We will continue to press them and are happy that discussions are already underway on this front.

A BJs or Wal-Mart at the Gateway Center?

Lombardi also highlights the labor and small business opposition to the possibility of putting a BJ’s or a Wal-Mart on the site. The Alliance, along with the UFCW and RWDSU, will be pushing hard against this potential use of the BTM property.

Government Theft Attacked

Once again, demonstrating how the issues of eminent domain and overdevelopment can overlap ideological boundaries, the Supreme Court decision in Kelo is under attack. This time it is Julia Vitullo-Martin of the conservative Manhattan Institute, writing in today’s Daily News. What is particularly interesting about her piece is her underscoring of how New Yorker’s are especially vulnerable to the impact of the Court’s decision.

Vitullo-Martin, citing Martin Anderson’s work, points out that at one time 34% of all land confiscation (under urban renewal) was happening in New York State. In fact, whole swaths of land in East Harlem were part of the City’s program of "slum clearance." It was this destruction of entire neighborhoods that led many to equate urban renewal in NYC with “negro removal.”

The irony here, of course, is that the eminent domain issue links Vitullo-Martin, the conservative scholar, with Norman Siegal who, according to today’s Insider, is planning lawsuits on both Atlantic Yards and Morningside Heights, where Columbia University's expansion is slated.

Court Action, Public Reaction

What Court decisions often do especially when they really go against the popular grain, is to promote a political backlash. Blogger Virginia Postrel astutely illustrates this point:

I agree with Glenn Reynolds, who observes that Kelo may prove analogous to "Bowers v. Hardwick decision, which didn't make new law, but which led to a sea-change in public attitudes." Bowers was the 1986 ruling, also 5-4, that upheld Georgia's criminal statute against private, consensual oral or anal sex. The ruling galvanized efforts to repeal anti-sodomy statutes, to challenge such laws under state constitutions, and, ultimately, to get Hardwick overturned by the U.S. Supreme Court.


Kelo, by contrast, isn't about cultural symbolism and largely unenforced law. It's about common practices. American cities quite regularly take property from some private parties to give it to other, usually wealthier ones. Now that practice has the Supreme Court's blessing. Kelo could very well lead to much more aggressive use of eminent domain for "economic development." Bowers was offensive, but Kelo is scary.

That's all the more reason to crank up the grassroots activism ...
Read her whole post here

We’re hopeful that Kelo will inspire the grassroots activity that Postrel talks about. The Castle Coalition, sponsored by the Institute for Justice, is already offering to draft legislation for any interested parties. And, as Vitullo-Martin forcefully points out in the Daily News:

"New Yorkers successfully halted the old urban renewal in the 1970s. Now they must fight to halt the new urban renewal by securing the same protective legislation already enjoyed by four other states whose big cities had had enough.”

Recycling Garbage

The Gotham Gazette is focusing on the issue of recycling and quite rightly makes it abundantly clear that the mayor’s plan has no clear methodology for achieving the lofty goal of a 26% recycling rate by 2010. It is also clear to us that the Council’s alternative is much too complex, relying on an elaborate system of recycling bureaucrats. As Benjamin Miller, former director of policy planning for the Department of Santiation points out in the Gazette:

“The plan proposes what I would argue are likely to be quite inefficient systems [that] reflect a flawed understanding of how a recycling system should be designed,” he said. “We have to keep it simple.” Miller believes the best way to increase recycling is to charge people for the amount of garbage they throw out, creating an incentive to reduce the amount of waste they produce by, for example, recycling more.”
What is also apparent is that city discussion of how the Hugo Neu facility makes the mayor’s recycling plan a breakthrough is plainly foolish. The more efficient processing of recyclables doesn’t enhance the feasibility or efficiency of collection.

Commercial Waste

The Gazette only mentions commercial waste in passing. The Council is looking to enforce a recycling policy on businesses while the mayor simply ignores the sector entirely. Yet this is the waste that the waterfront neighborhoods are up in arms about. We have been hearing rumbles that the Council is ready to implement a pilot program for commercial waste disposers. We’ll keep you updated on this.

Tuesday, June 28, 2005

Wal-Mart Unhealthy for Communities

Many people across the country are irked by Wal-Mart’s poor health benefits and the attendant reliance of its employees on public health care programs. It seems that Staten Islanders aren’t any different. We received word that the Staten Island Partnership for Community Wellness, a 200+ member coalition of hospital administrators, community health advocates, and concerned individuals has officially come out against Wal-Mart coming to the Richmond County. This group, who we have been in contact with, is worried about uninsured and underinsured Wal-Mart workers burdening a health care system that already is in crisis (there is no public city hospital on Staten Island and private hospitals often have to underwrite the costs of caring for the uninsured). For a borough that already sees itself as not receiving its fair share of city health care dollars, the thought of having to subsidize Wal-Mart is simply unacceptable.

Wal-Mart won't accept agency's 'no' to store

From the St. Petersburg Times:

ST. PETERSBURG - Brighton Bay residents must gear up for another battle if they want to block the construction of a Wal-Mart supercenter in their northeast neighborhood.


The owners of the vacant 27-acre tract on Gandy Boulevard have appealed the ruling of the Environmental Development Commission, which voted 5-2 earlier this month to reject Wal-Mart's site plan.

Now the debate will shift to the City Council, which has 60 days to hold a public hearing. The EDC's rejection means it will take a supermajority of the council - six of eight members - to overturn the ruling.


The 150,000-square-foot supercenter would include a grocery store, garden center and a separate liquor store. Residents say the store would destroy natural wetlands and bring too much traffic to an already congested area.

More Reactions to Eminent Domain Decision

John Norquist, a former mayor of Milwaukee and president of the Congress for New Urbanism, offers PBS the liberal case against the Supereme Court’s recent eminent domain decision (hat tip: hit and run):

JOHN NORQUIST: Well, I think that's the potential. It's shocking, really. The founders of the country put the word "public use" in the 5th Amendment for a reason, because they wanted property rights to be part of our democracy. And there are really legitimate reasons for condemnation, not just public works but sometimes clearing lands so that it can environmentally repaired. There are all kinds of good reasons to do it. But this opens it up to virtually anything; any municipality could say "Well, the land will be more valuable."
This is an issue that should worry liberals as much as private property-minded conservatives because of the very real possibility of politically-connected developers driving out homeowners, small businesses owners and others with less influence.

In reaction to the court decision, Eugene Volokh mentions that Senator Cornyn (R-TX) has proposed a bill limiting the government’s eminent domain powers in the aptly titled: S. 1313, "The Protection of Homes, Small Businesses, and Private Property Act of 2005:

(a) . . . The power of eminent domain shall be available only for public use.
(b) . . . In this Act, the term "public use" shall not be construed to include economic development.
(c) . . . This act shall apply to (1) all exercises of eminent domain power by the Federal Government; and (2) all exercises of eminent domain power by State and local government through the use of Federal funds.

And for more reaction, check out Virginia Postrel’s blog.

Atlantic Yards and Community Benefits Agreements

The community benefits agreement (CBA) that Forest City Ratner hammered out with community groups ACORN and BUILD is a historic first for this city. We know that many of you who sympathize with a number of the Alliance’s campaigns are not fans of Ratner and we’ll admit that the eminent domain threat gives us some pause. Still, the recently concluded CBA does remind us a bit of Samuel Johnson’s remark about the dancing dog: “It’s not that it dances well, it’s that it dances at all.”

There are, no doubt, some imperfections in the deal but that doesn’t take away from the considerable number of benefits that Dennis Hamill highlights in his Daily News Column today. In particular, the impressive amount of affordable housing makes this deal hard to criticize. Any development deal that gets the support of Bertha Lewis and the Reverend Herbert Daughtry must have a lot of good in it for the community.

Update: In the interest of full disclosure, as we have stated previously on the blog, we are working with Forest City Ratner on the sports aspect of the project.

Related, Not

Which brings us to the Gateway project on the gravesite of the Bronx Terminal Market. At yesterday’s hearing Jessey Masyr, a lawyer for Related, talked about a CBA when asked about the issue by Councilman Monseratte. He said it would be ready before the land use disposition reached the Council in ULURP.

Is he really serious? If Related wants to promulgate such an agreement it needs to tell City Planning to hold off on the certification of the application while it begins a negotiation with the Mid-Bronx community that came out to voice its concerns last Saturday at the Mullaly Recreation Center.

As Councilwoman Arroyo said at yesterday’s hearing, these folks, her constituents, are concerned about a wide range of issues. The Mid-Bronx Council, the Neighborhood Advisory Council and the Bronx Voices for Equal Inclusion stand ready to meet with the developer. It should happen immediately and not be a patchwork effort as Related tries to bum rush the project through ULURP.

Electeds Need More Resiliency

The council members who expressed support for Gateway need to be tougher in asserting the legitimate needs of the neighborhood and local businesses. As anyone who has ever been in negotiations knows, whenever you are too eager you make it more difficult to iron out the best deal for your folks. Related sees the eagerness and knows it doesn’t have to give up all that much to insure the continued support for the Bronx Terminal Market redevelopment.

The Bronx delegation, led by local council and state reps from the Southwest Bronx, need to bring together a community coalition to negotiate a CBA with Related. Time is running our for the local neighborhoods.

Monday, June 27, 2005

Summary of the Hearing on the Bronx Terminal Market

Today’s joint hearing which examined issue of preserving the Bronx Terminal Market was, to say the least, quite interesting. It was attended by a number of elected officials including Council members Jackson, Stewart, Clarke, Monserrate, Nelson, Baez, Arroyo, Rivera, Palma, Felder and Martinez. First up to testify was EDC president Andrew Alper and Related Lawyer/Lobbyist Jesse Masyr. Most of their testimony consisted of praising the new Gateway Center development, using 3d animations and color handouts to emphasize the greatness of this project for the Bronx.

However, the most relevant portions of their presentation concerned the relocation plan. According to Alper, the merchants were offered a tremendous deal which included an $8 million dollar assistance package and the help of the well-reputed Cornerstone real estate company. The EDC president explicitly stated that Cornerstone found the merchants spaces that generally would accommodate 1 or 2 merchants (one potential site could house the 5 or 6 African merchants, he said).

This demonstrates that, from the beginning, EDC and its relocation agency did not see the need to relocate the merchants as a single entity, the only way in which the market could remain economically value. If Alper and his organization had actually sat down with the wholesalers or understood the workings of the market they would have not offered a plan that was essentially assisted suicide. The Bronx Terminal Market is such a draw because of its combination of unique ethnic products and its function as a one stop shopping destination. Remove these attractive elements and you destroy the market.

Making matters worse is the fact that Alper’s so-called generous deal was an ultimatum. EDC told the Terminal Market merchants either take the deal or be evicted with nothing. Instead of negotiating with the vendors to come up with the best deal from both them and the city, Alper’s office arrogantly thrust on them a plan that would kill their businesses.

Throughout his testimony, the EDC president expressed incredulity as to why the merchants wouldn’t talk to his office. Alper intimated that they were being led astray by misguided lawyers and public relations advisors and that his people were doing all they could to look out for the interests of the merchants. However, it was EDC that, by offering a take-it or leave-it deal that would scatter the vendors, showed it had no real interest in truly helping the Terminal Market wholesalers. If someone hands you the noose to kill yourself does it then make sense to continue talking with them about preservation?

EDC was peppered with many tough questions especially from Councilmember Monserrate and, later, Councilwoman Clarke. Monserrate not only questioned the sole-source nature of the deal but asked whether the economic development agency had even appraised the value of the land that the Terminal Market and the Bronx House of Detention sits on. Alper had no idea which demonstrates that the city is basically giving away property to a single developer without knowing how much it’s worth and whether the Related deal is in fact the most economically beneficial.

Clarke’s line of questioning focused on whether Alper and EDC had studied a) the economic importance of the market and b) whether it was making any effort, through loans, trainings, partnerships with community groups, workforce development, etc… to make sure that the Bronx Terminal market merchants could survive and prosper. The Councilwoman’s basic point was that if EDC showed the merchants even a fraction of the attention it showed to Related the agency would be doing a lot more to insure the market's economic survival. In the end, after being pressured by Monserrate, Clarke and the other council members, Alper conceded that he still wants to help the merchants as long as they come to the table.

The next panel to testify included James Connolly who, with Professor Fainstein, prepared a report that demonstrated the feasibility of relocating the merchants as a single entity. The Council members present were extremely intrigued by these alternative visions (ones that EDC and Cornerstone never bothered to pursue) and expressed the desire to sit down with the Merchants and EDC to figure out which of the proposed sites would be most viable and economically feasible, the assumption being that the City would help with the move and the construction of a new market facility.

This was a very important part of the hearing because all the present members, especially those of the Bronx Delegation, declared their support for preserving the market. We will see what happens within the next few weeks but we’re pleased that key council members are on record as saying that the preservation of the market must occur. Considering that the merchants were essentially left for dead and were about to be evicted a couple of months prior, the developments at the hearing are a promising first step to the saving and even possible expansion of the valuable Bronx Terminal Market.

Eminent Domain Anthem

Commenter papertiger, channeling Don Mclean, composed the following eminent domain mini-anthem which we'd like to share:

Oh, and while the King was looking down
The jester stole all of midtown
The courtroom was adjourned
The verdict was returned
And while Stevens read a book of Marx
The quartet practiced in the park
And we sang dirges in the dark
The day that freedom died

Bye bye Constitutional rights
Freedom’s aching from the taking
State power up to new heights
And fascist robes are seizing homes day and night
Singing we need these for retail store sites
We need these for retail store sites

Coverage of Today's City Council Hearing

Jill Gardiner, in today’s New York Sun (subscription), pens an excellent piece about the Bronx Terminal Market hearing today. She highlights the lack of competitive bidding and relocation plan, quoting Neighborhood Retail Alliance spokesman Richard Lipsky:

"All kinds of alternative visions for the site were never entertained," a lobbyist for small businesses, Richard Lipsky, said. "These people were an afterthought." Mr. Lipsky is spokesman for the Bronx Terminal Market Merchant Preservation Association.
It is important to emphasize that we are not trying to stop the project but to preserve the market in its entirety and make sure the deal is thoroughly scrutinized:

He acknowledged that the support in the Bronx would make it difficult to block the deal. His primary concern, he said, was getting the community more benefits, protecting the merchants, and ensuring more transparency. The transparency issue has dogged the administration before, most notably on the West Side stadium proposal the mayor was pushing.

"We're trying to show that this was an unfair deal that uses millions of public dollars and reeks of favoritism," Mr. Lipsky said.
There is no doubt that this area of the Bronx needs redevelopment but the question still remains why does redevelopment here necessitate the breakup of a viable ethnic market and a process that excludes multiple visions and community input.

One other interesting side note is that Related has hired the Marino Organization, the same publicist that Wal-Mart is using in New York City. We guess birds of a feather do flock together.

Maria Vega in El Diario also covers the hearing and the mentions the uneasiness among certain Bronx officials and community members vis-à-vis the Bronx Terminal Market redevelopments.

Hearing Today on the Bronx Terminal Market

There will be a City Council hearing today at 1:00 p.m. which will take a hard look at the lack of relocation plan for the merchants and the overall deal that gave Related the rights to redevelop the sight. The hearing, a joint session of the Contracts and Small Business committees headed, respectively, by Council members Jackson and Nelson, will feature tough questions directed at EDC and Related as to why, among other things, no attempt was ever made to preserve the market either within the development or on another viable site.

Specifically, these are some of the questions we hope that the Council members in attendance will ask:

1) Why, if this was a city-sponsored deal, was there no open bidding process to choose the developer for the Bronx Terminal Market redevelopment?

2) Why is the city guaranteeing that if this deal falls through that it will pay back Related the $40 million the developer used to buyout the previous owner?

3) What role did Deputy Mayor Doctoroff play in enabling Related to get what amounts to a sole source bid for 1 million square feet of retail space?

4) How much public money is being allocated to Related for this project?

5) Why hasn’t the community been involved in deciding what will be built?

6) Why is the City pushing ahead with certification of this project when the fate of the merchants has yet to be decided and a lawsuit is still pending in court?

7) Why hasn’t EDC attempted to preserve the market either by finding it a new home or by suggesting it be incorporated into the redevelopment? What officials participated in the decision not to retain the merchants on-site or move them to another viable location?

Sunday, June 26, 2005

Eminent Domain and NYC

Supreme Backlash

The reaction to the Supreme Court’s eminent domain decision continues. The NY Post is particularly sharp in its highlighting of the conservative-liberal split in the Court’s 5-4 decision.

The paper goes on to urge:

Both Congress and state governments need immediately to consider what specific limits can be drawn on the concept of "public purpose" — and how best to mitigate the effects of this truly disturbing decision.
The paper, which also published a scathing cartoon of the decision with the tagline “Sold to the politically wired developer,” also points to the potential growth of a unique liberal-conservative alliance on this issue remarking:

It’s ironic that the conservative justices are the ones who sound like the New York liberal voices that rise to block almost any sort of economic development.
This theme, of course, fits directly into our conservative case against Wal-Mart. The alliance of politically-connected developers (in the Connecticut case we wouldn’t be surprised by the existence of a corrupt stench in the New London connection) with box store retailers threatening to bulldoze poor and more conservative working class neighborhoods alike.

In spite of the New York Times’ self-interested blinders in this matter, there are now no limits on the confiscation of a person’s property since even the elastic “blight” concept is no longer a necessary concomitant to a government-sponsored confiscatory development scheme. We can envision the growth of an interesting coalition in New York State, one that transcends ideological lines and that seeks to place clear restrictions on the use of this radical taking of land.

Beware of Corporate Cronyism

New York City is particularly vulnerable to a policy of aggrandizement of favored real estate interests. Jack Newfield’s concept of the permanent government, one in which real estate developers play a key role, is particularly instructive. Under Rudy Giuliani, the law firm of Ray Harding represented a coterie of usual suspects who managed to always elbow their way to the head of the development line. The same is true with Bloomberg Administration where the Related Companies has gained a favored nation status.

So, whether it’s a corrupt cash nexus or a more seemingly benign Old Boys network, the result is the same: someone with more money and political juice will be able to legally seize your property without any safeguards.

Willets Point in Crosshairs

Which brings us once again to the 48 acre parcel known as the Iron Triangle in Willets Point, Queens. There are hundreds of businesses in the area employing thousands of mostly new immigrant workers. We all await the city’s unveiling of the various development proposals for the area but no one is holding their breath anticipating the accompanying relocation proposal to maintain the businesses in the area.

Just as with the Bronx Terminal Market redevelopment, where the city viewed the existing businesses with total disdain, is predicted that the same callousness will be demonstrated by Bloomberg’s minions vis-à-vis Willets Point.

Daily News Also Weighs In

The News’s position straddles, not unreasonably, in between the Times and the Post. While saying that it may be necessary at times to promote “the greater good” through eminent domain it goes on to point out:

The court did not set particularly clear or stringent standards for determining which condemnations pass muster
The News also states that the only standard, one that we have already questioned, is that property should be seized only under a “carefully considered development plan.” Clearly, as the paper mentions, “that allows for a great deal of discretion.”

Political Intervention Must Start Now

With the NYS legislature going on hiatus until the fall, it is incumbent on the New York City Council, jointly through its Economic Development and Land Use Committees, to begin to hold hearings on crafting eminent domain guidelines. With Atlantic Yards all about completed and Willets Point ready to move to the front burner, it is essential that the city set some standard for what constitutes a public purpose.

For us, it would make the most sense to look towards a more comprehensive reform package, one that uses the Accountable Development Initiative and the Andersoneville Study as guidelines. We are already being told that the Gateway project in the Bronx will create over 5,000 jobs (up, in typical political helium fashion, from the previous claim of 2,000 jobs) but no one is asking the hard questions about job loss and the character of the replacements.

Bronx Community Meeting on Redevelopment

We had the pleasure of attending a meeting of the Mid Bronx Council and its Neighborhood Advisory Council. The Council’s organizer Lydia Sierra put the meeting together with the help of Greg Bell, chair of the Bronx Voices for Equal Inclusion. The meeting was attended by Assemblywoman Aurelia Greene, State Senator Jose Serrano and Councilmembers Foster and Arroyo.

The focus of the get together was the Yankee Stadium and Bronx Terminal Market developments. Green and Foster were particularly concerned that these projects might, through gentrification, lead to the expulsion of long time residents who had stuck together through all of the hard times in the community. Foster also expressed outrage over the treatment of the Terminal Market merchants. She has been a true righteous leader on this issue and will no doubt continue to be outspoken at tomorrow’s City Council hearing.

One could persuasively argue that the gentrification and expulsion of the Bronx Terminal Market is a harbinger for the entire community. It goes hand-in-glove with the Bloomberg push for “highest and best use” for city property. Perhaps the mayor is also planning to evict all of the public housing tenants at the Jacob Riis Housing Project on the Lower East Side. After all, that land is too valuable for the quality of the tenants in the public housing.

Transparency Lacking in the Southwest Bronx

The elected officials at the community meeting also questioned the lack of transparency in the Gateway Project. In fact Helen Foster, contrasting the Yankee Stadium project to the Gateway development, praised Yankee president Randy Levine for his openness and willingness to talk about minority contracting and job training. All of this just makes the issue of accountable development that much more compelling.

Friday, June 24, 2005

Big Boxes and Eminent Domain

One thing we didn’t mention in our prior posts on the recent Kelo Supreme Court case was that now it would be much easier for big box stores such as Wal-Mart to exploit eminent domain to obtain sites for their stores. As a CNN Money article points out, because of space shortages, especially on the east coast megaretailers are looking to take private land:

"On the West Coast, land availability takes a back seat to labor union issues and that's why Wal-Mart has consistently run into problems in California," Johnson said.

"On the East Coast, because of population density it's very hard to get big open space and the zoning is more restrictive," Johnson said.

Industry consultant George Whalin said that's one reason that Target, the No. 2 retailer behind Wal-Mart, has resorted to using eminent domain to set up shop in a few East Coast markets.

"Wal-Mart and Target have both been criticized for their eminent domain use," said Burt Flickinger, a consultant with the Strategic Resources Group.
The piece also mentions, as we have pointed out, that the recent Supreme Court ruling is particularly harmful to small business:

Meanwhile, eminent domain opponents called the high court ruling a "big blow for small businesses."

"It's crazy to think about replacing existing successful small businesses with other businesses," said Adrian Moore, vice president of Los Angeles-based Reason Public Policy Institute, a non-profit organization opposed to eminent domain.

"There are many, many instances where we've found that the cities that agreed to eminent domain use not only destroyed local businesses but the tax revenue that the local government had hoped to generate did not come to pass," Moore said.
More on Wal-Mart and Eminent domain can be found here and here.

Survey: Life on Staten Island Getting Worse

According to a survey jointly conducted by Citizens for NYC and Baruch College 70 percent of Staten Islanders believe that the borough is heading in the wrong direction. Two of the largest reasons for this pessimistic outlook: traffic and overdevelopment.

This is why we do not think Wal-Mart will get the warm embrace that certain politicians, economic development officials and company representatives are hoping for. As more Staten Islanders learn about the tremendous vehicular traffic (approximately 50,000 car trips a week) that the superstore will attract, they will begin questioning whether the development is worth it. Not only will a Wal-Mart concentrate traffic on roads not equipped for it but much of this traffic will be drivers from Brooklyn and the other boroughs. These factors combined with a general anti-overdevelopment sentiment will generate quite a bit of resentment against the proposed Wal-Marts on Staten Island.

Eminent Domain Furor

The papers this morning are filled with stories and editorials on the Supreme Court’s decision in the New London eminent domain case. Unsurprisingly, the New York Times editorializes in favor of the 5-4 decision in a piece ominously titled “The Limits of Private Property.” Rebutting Justice O’Conner’s blistering dissent that the Court had paved the way (quite literally) to allow for the transfer of “any private property from the owner to another person so long as it might be upgraded,” the Times opined that “her fears are exaggerated.”

According to the Gray Lady:

The majority strongly suggested that eminent domain should be part of a comprehensive plan, and Justice Anthony Kennedy, writing separately, underscored that its goal cannot simply be to help a developer or other private party become richer.
Is the Times really serious? The use of eminent domain is almost always part of some comprehensive plan that often beautifully masks the underlying, blatant property transfers (One of the best examples being the Times’s own new headquarters on 8th Avenue). In addition, these larger urban renewal schemes that do transfer property also are usually larded up with tax payer subsidies that make the taking more suspect.

For a radically different take on all of this see George Will’s column in today’s NY Post and the New York Sun’s editorial as well. In fact, the Sun’s point that the conservative justices were standing up for the little guys and the liberals for the rich and well-connected is particularly well-taken. As Justice Thomas wrote:

[The] losses will fall disproportionately on poor communities. Those communities are not only systematically less likely to put their lands to the highest and best social use, but are also the least politically powerful.
What’s left is the point we made in our earlier post. People who feel strongly about the expansive use of eminent domain need to look to the legislature for relief. As Anne Michaud writes in today’s Crain's Insider, Norman Siegel has already urged that Albany, “take up the challenge of limiting eminent domain.” As important, however, is the needed to place this limitation in the context of a more comprehensive approach that promotes accountable development.

Also, Instapundit has a nice roundup of the reactions to the Court's decision.

“The Land is Too Valuable”

Which brings us to Mayor Bloomberg’s mantra about Willets Point. The land, according to the mayor, is too valuable for the businesses that are on it. This is the dirty, secret reality behind a great many eminent domain proceedings. New York City is not New London, a poor city that, because of its poverty, the Times believes is justified in removing people from their houses. In NYC, and especially in Willets Point, the development schemes will more strongly reflect Justice O’Conner’s observation that, “As for the victims, the government now has the license to transfer property from those with fewer resources to those with more.”

LSK Turkey Factory

We have been advising the LSK Turkey Factory at Noble Avenue in the Bronx ever since local residents have protested odors emanating from the facility. We do sympathize with local residents but the issue raises a number of important questions.

First of all, under the city’s code for odor, enforced by the DEP, there is a zero tolerance calculation for enforcement. What his means is that, in theory, any odor could be grounds for shutting a business down, even your local McDonald’s, pizzeria or bakery. When such a standard exists, however, there is no standard at all and any enforcement action, usually initiated by some disgruntled local residents, is based on political pressure. It must there be, by its very nature, capricious.

In addition, what the LSK situation also highlights is the tenuousness of many of the city’s M-1 districts that abut residential areas. As these areas grow, residents are unwilling to tolerate a manufacturing use in their midst and pressure is brought to bear to regulate the use out of existence.

Take My House, Please

The US Supreme Court, in a 5-4 decision, has ruled that the government may take a person’s property and hand it over to a private developer for the purpose of economic development. In the case before the Court, the city of New London, Connecticut condemned houses in a waterfront area to make way for a luxury development.

The issue before the Court was what exactly constitutes a public purpose. Opponents of eminent domain, led by the Institute for Justice, believe that a public purpose needed to be narrowly constituted (i.e. for the building of a school or bridge) in order to fully protect a citizen’s right to own property. The Court in disagreeing argued that an economic development project, by creating jobs and tax revenues, was to be considered in the public interest as well.

All of which leaves opponents of the Brooklyn Arena disarrayed and in disarray because it takes whatever thread of legal hope they may have harbored and unraveled it. It also puts any potential legal challenge by the Willets Point merchants in jeopardy.

We find the Court’s decision weak for one major reason. It allows government to define almost anything as in the public interest. If the Court had ruled for the plaintiffs, however, it could have force local governments to more rigorously define the concept and put additional layers of protection for property owners.

That being said, it is now up to the local and state governments to do what the Court was reluctant to do: craft a better definition of the public good and build better barriers to a promiscuous use of eminent domain. In the absence of a judicial edict, governments should be forced to act.

Thursday, June 23, 2005

Watered Down Dispensation

According to the New York Law Journal:

A federal magistrate judge Wednesday reduced a jury verdict by $4.7 million in a disabilities discrimination case against Wal-Mart.
The judge said that due to federal caps on punitive damages he was legally obligated to lower the payout but believes that the verdict now will be less likely to change Wal-Mart:

In doing so, Eastern District of New York Magistrate Judge James Orenstein said that the $300,000 federal cap on punitive damages in the Americans with Disabilities Act would have little impact on changing the behavior of a "commercial titan" like Wal-Mart.


"There is no meaningful sense in which such an award can be considered punishment," Orenstein wrote, pointing out that Wal-Mart had $300,000 in sales every 37 seconds last year.
The original lawsuit was brought by Patrick Brady who suffers from cerebral palsy:

He sued Wal-Mart under the federal Americans with Disabilities Act and state law. In February, a Central Islip, N.Y., jury found that personnel at the store in Centereach, N.Y., violated federal and state laws by making a prohibited inquiry before giving Brady an employment offer.

The company also subjected Brady to adverse employment conditions by transferring him from the pharmacy to a more physically taxing position pushing carts in the parking lot, according to the verdict.

Local Town Won’t Subsidize Wal-Mart

It has been well documented that Wal-Mart tries to extract large tax breaks from the towns where it wants to build. It isn’t uncommon for the company to say to a city that if they do not receive tax abatements or subsidized infrastructure improvements that they will simply not build. Or they will play neighboring town against each other saying that if they don’t receive subsidies in one city then they’ll build in the next one over.

Despite these explicit and implicit threats, Rush Township in Pennsylvania rejected $1.4 million that a Wal-Mart developer requested for a new supercenter:

A proposed tax break to lure retail giant Wal-Mart to Rush Township died late Tuesday when Tamaqua Area School Board unanimously rejected it.

The plan would have cut taxes $1.4 million over eight years for a developer, paving the way for a Wal-Mart Supercenter in the former Laneco shopping center in the Hometown area of the township.


The school board voted unanimously to reject it.

''Most of the board thought the money they were asking for was exorbitant,'' School Director Robert Betz said Wednesday.

''The board also felt that, here is the world's largest corporation, and they want a tax break from this little area that can't afford much. They could probably buy and sell this town three times over.''
We congratulate Rush Township and believe that more towns across the U.S. should tell Wal-Mart that the tax payer does not need to subsidize their operations.

Trash II

The mayor’s veto may be sustained but the folks on the East Side aren’t finished fighting. A Mr. Ard of the Gracie Point Community Association told the Times this morning that if all else fails his group is prepared to file a lawsuit:

"As the City Council now moves forward in considering the entire Solid Waste Management Plan, this community will continue to use every resource to demonstrate that East 91 Street is an inappropriate site for a 10-story, 24-hour, six-day-per-week garbage dump, " Anthony Ard, president of the Gracie Point Community Council, said in a statement. "Should all other measures fail, the community plans to continue the fight in court."

A spokesman for Mr. Miller said he was likely to join such a lawsuit if it is filed.
All of this is sadly what we predicted when we talked to the group’s leaders and their attorneys last fall.

Willets Point Wages War

We met with 125 of the Willets Point businesses last night along with Council members Monseratte and Avella as well as Richard Cecere, chair of Community Board 3 in Queens. The tenor of the meeting was heated and the common sentiment was that the businesses were ready to stand and fight Bloomberg’s elitist desire to disappear them. We’re ready to help them out and, if the Bronx Terminal Market is a nasty fight, it will look like a kindergarten scuffle when compared to what lies ahead here in Queens.


Without the necessary votes for an override Speaker Miller canceled the scheduled vote at today’s stated meeting. All of which leaves the fate of the mayor’s SWMP up in the air. With the siting issue resolved one wonders how the Speaker will be able to marshal support for a consensus position vis-à-vis the mayor.

Clearly, the council members who voted with the mayor have not thought through the implications – post Miller – of the weakening of the body’s institutional authority. In addition, we are still left with all of the inadequacies of the SWMP that we have outlined for the past year, beginning with a Newsday Op-ed in October.

Now that they are faced with the reality of a waste disposal policy that has no reduction component it will be interesting to see just what this council will do. We are, of course, hopeful that the pilot program for commercial waste disposers will be included in any eventual amending of the currently crafted SWMP.

Wednesday, June 22, 2005

Preserving the Terminal Market

Susan Fainstein, acting Director of the Columbia University’s program in Urban Planning, was hired by the Bronx Terminal Market merchants to determine whether it was possible to preserve the market. Though the city and the Related Companies, the new developer, have not considered this option, Professor Fainstein clearly proves that there are a number of options for preserving the Terminal Market (including keeping the market where it is) while also moving forward with redevelopment.

It is sad that the merchants had to hire an outside authority to prove that preservation is viable and economically beneficial. The city should have been willing, from the beginning, to do what it could to maintain this vital distribution network. Instead EDC’s basic stance has been that they are under no obligation to keep the merchants together and the only relocation assistance offered has been giving the wholesalers copies of NYT warehouse ads.

The professor’s complete report can be found here.

Wal-Mart workers in Greeley want vote on union

A group of workers in a Greeley, Colorado Wal-Mart store are pushing to form a union . Interestingly, the effort is led by a 21 year college student:

This is a big fight, and that’s why I’m doing it,” said Jared West, 21, a senior at the University of Northern Colorado who has worked at Greeley’s newest Wal-Mart for two years. “I’m not the kind of person who can just sit there and allow (the company) to keep pushing people around. ... It scares me, but I’m not willing to back down. I don’t know if I’m going to be able to change it around here, but I’m going to try.
Read the whole thing

Economic Impact Analysis of Wal-Mart

For quite a while we’ve been saying prior to considering any Wal-Mart application, a thorough and independent economic impact study is needed. This cost benefit analysis should examine the jobs created versus the jobs lost, the number of stores that would be put out of business, the impact on traffic and other infrastructure, the sales tax gained from the store versus the tax dollars lost (public subsidization, use of public health care, loss of tax-paying small businesses) and whether the store would help stem so-called retail leakage to New Jersey and the suburbs.

While this idea has so far gotten little attention here in New York City, other municipalities across the country are first studying the affects of Wal-Mart supercenters before going ahead with approval. Included in this list is Galt, a Californian town of only 20,000. The City Council there is interested in ascertaining Wal-Mart’s affects and will be awarding a contract tonight for the study.

We hope the New York City Council follows little Galt’s lead.

Wal-Mart Show on Staten Island Television

The Alliance will be taping a show tonight that will soon be appearing on Staten Island television. The focus will be on Wal-Mart’s desire to come to the Island and we’ll be joined by Mike Mareno, Secretary-Treasurer of UFCW Local 342 and Lillian Popp, President of the Coalition of Staten Island Womens Organizations. They are also both longtime Staten Island residents.

SIEDC was invited to present the pro-Wal-Mart view but they declined, saying that they haven’t taken an official position yet. That is a bit surprising considering our conversation with a member of that office as well as their director’s desire to prove Staten Islanders want Wal-Mart. It is obvious that the agency is quite supportive of Wal-Mart and other big box development so why can’t they just come out and say it?

Once we know what dates/times the show will air we’ll let you all know.

Speaker’s Override Votes Up in the Air

According to a council member very close to the situation, the Speaker will fall some votes short in his attempt to orchestrate an override of the mayor’s veto. What this will all mean for the remaining six months of his term is anyone’s guess (including what impact it will have on the budget negotiations).

In discussions with some of the dissidents, it appears that in exchange for their votes against an override some council members will insist that the mayor open 59th st. to at least 2,000 tons per day of commercial waste. No one seems willing, however, to specify just how the city will be able to channel this private sector waste to the transfer station. When asked, one staffer talked about legislating flow control (a fancy term for mandating that private garbage must go to a certain facility) or simply having DSNY unilaterally refuse to renew certain transfer station permits.

We can’t say we’re shocked since we’ve been predicting this direction all along. Let’s simply say that it is in the city’s plan to channel all commercial waste into city-owned or managed transfer stations. Once accomplished the cost of tipping will be controlled by the city and it goes without saying that it won’t be long before all of New York’s retailers will be fronting the cost of disposal for the city’s residential waste.

Which is precisely the reason why a number of people within the municipal sanitation monopoly oppose commercial waste disposers. Food waste is the cash crop in the private garbage mix and its elimination will remove the waste that the city would be able to heavily levy once disposal is mandated into municipally-run facilities.

Willets Point Merchants Meet

Tonight at 7:00 p.m. there will be an organizing meeting of the Willets Point merchants. Flyers have been sent around and a big turnout is expected at the Parts Authority conference room. It is believed that there may be close to five hundred businesses in the so-called Iron Triangle and, needless to say, they aren’t thrilled with the thought of being put out of business by a new Shea Stadium and other propose developments.

The meeting will be attended by Councilmen Monseratte and Avella who will tell the businesses about the importance of working together. The Alliance has been asked to come and explain the political situation to the merchants. It is likely that we will eventually represent the interests of the group and help to design a strategy to enhance the equity of the constituent businesses in the face of the city’s efforts to disappear them.

Tuesday, June 21, 2005

SIEDC's Own Report Contradicts Its Love for Wal-Mart

The Staten Island Economic Development Corporation (SIEDC) came out with a report today that underscores the biggest impediments to business development on the Island:

The Staten Island Economic Development Corporation's blueprint for the future reveals what residents have known for years: The borough is choking on traffic and the retail industry is suffering because of the sales tax.
We couldn’t agree more with the SIEDC and believe that their desire to keep business on the island is commendable:

Strategies include a collaborative effort to permanently exempt clothing and footwear from the sales tax; creation of more business districts; zoning changes to include more mixed-use buildings, and tax incentives for both new and existing businesses.

"We have to make sure that Staten Island is the first choice of consumers," said Commerce Bank's Fred Graziano, who chaired the retail committee.
Considering this report, we don’t understand SIEDC’s unequivocal support for Wal-Mart coming to Staten Island. We even spoke with an official from that office a number of weeks ago who claimed that Wal-Mart would not harm small business (it would only affect bigger retailers like Target, he said) and that it would be an overall boon to the SI economy by creating jobs and keeping tax dollars in the borough.

Well, maybe this official needs to read his own agency’s materials a little more closely. If, as SIEDC points out, traffic is a obstacle to Island shopping than how is adding a Wal-Mart, with its attendant 50,000 automobile trips a week, going to improve the retail situation? The mega-retailer will only make it harder for people to get around, decreasing the likelihood that customers will frequent a number of local stores.

If the SIEDC believes more mixed-used developments, with office space, park land and smaller retail, is needed how does a 200,000 sq.ft. Wal-Mart make sense? As the residents of Staten Island, especially on the South Shore, will tell you they need offices, green space and good jobs for their community members, not a Wal-Mart.

And on the issue of shopper dollar leakage to New Jersey the SIEDC report again contradicts the official position. If tax discrepancies encourage Island shoppers to leave, they will continue to do so even if a Wal-Mart is built in the borough (more on this). There is no incentive for a Wal-Mart shopper from Staten Island to stop going to Jersey (with its lower sales and gas taxes), and instead shop in the more expensive, identical New York Wal-Mart. Though it is true that the Staten Island store would be physically closer (and in theory more convenient) due to the traffic that SIEDC acknowledges (and would be exacerbated by Wal-Mart) that possible advantage would be canceled out.

Just as mind-boggling is that SIEDC’s support for Wal-Mart comes amidst their campaign to keep local business on the Island. According to their website the program’s goals are to:

Encourage local companies and residents to utilize Staten Island Businesses for all products and services

Support your neighbors (local vendors)

Work to protect the future – preventing businesses from relocating or going out of business

[Recognize the] Economic impact of doing business locally
These are laudable aims but ones that become laughable when taken in conjunction with SIEDC’s active support of Wal-Mart. Wal-Mart will lead to the closure of a number of small businesses as well as independent and regional supermarkets that anchor the strips where neighborhood retailers are situated. The mega-retailer does not utilize local vendors and, more generally, does not contribute to the so-called multiplier effect where local businesses stretch the dollar by using other local businesses.

It seems that the economic development agency is good at pinpointing problems to the Island’s future development but not quite as adept at proposing viable solutions. Is this perhaps because of untoward political influence over their policy suggestions? We suggest that the SIEDC and its various representatives reread their own materials, revisit their own goals, and truly examine the impacts of Wal-Mart, before suggesting that the mega-retailer is good for Staten Island.

p.s. According to a source, SIEDC executive director Cesar Claro, has claimed that he's done extensive surveying which shows that the two stores Staten Islanders want most are Target and Wal-Mart. Besides seriously doubting the methodology here, we believe that it is inappropriate for an agency charged with examining economic impacts to transform itself into an opinion survey organization. Instead of trying to push an agenda, the SIEDC should be thoroughly examining the impacts of a Wal-Mart, including its affect on traffic, jobs, crime, infrastructure usage, etc… If the agency won’t do this maybe it should disband and reconstitute itself as PR firm for the Borough President.

Mayoral Hopefuls Divided on Trash

Frank Lombardi continues his trash odyssey today and details the position of the various mayoral candidates. Unsurprisingly, the two Manhattan candidates oppose the 91st transfer station while the outer borough candidates support it. We’re hoping that in the weeks to come a clear alternative vision emerges from all the mayoral hopefuls.

Expanded Bottle Bill

Last night the NYS Assembly passed the “Better Bottle Bill,” a law that would expand the types of containers eligible for deposit. Currently, beer, soda and carbonated waters are included while plain water, tea and sports drinks are not. The impetus behind the measure is to increase the levels of recycling and reduce the amounts of street litter.

The only problem here is that the proponents of the bill have no idea what the bottle law has done to food stores in the city. The storage of thousands of dirty containers has caused an incredible sanitation burden for supermarkets, bodegas and green grocers. Very few of the containers are sealed and the cans in particular, with their sugary remains, are a magnet for insects.

A supermarket owner from upstate New York hammers this point home:

In addition to the impact on consumers, expanding the bottle law would force grocers to dedicate even more space to dirty bottles and cans. I can run clean food stores or operate dirty recycling centers, but not both.
The storage burden is, of course, much more severe for inner city stores than for their suburban counterparts. Not only is space at a premium but many of the stores coexist in residential complexes. The storage of containers is exacerbated by the city’s edict that disallows regular store garbage to be stored in outdoor dumpsters. So now your local supermarket has been transformed into a mini waste transfer station that, thanks to the Assembly, will be expanded beyond the capacity of most stores to handle.

That is why we were not emotionally moved by Daniella Gerson’s story of a former crack addict’s life as a can redeemer. It is always compelling to see anyone turn his life around through sobriety and hard work but Gerson’s piece fails to adequately portray the burden that the law places on already overburdened store owners.

The problem isn’t with Jean Rice and her pursuit of a living redeeming deposit containers. The problem lies with a legislature that is unable to come up with creative ways to expand the deposit system without placing the onus on small store owners. When we worked with the Empire State Beer Distributors we had proposed on numerous occasions a centralized deposit bank system that would facilitate the creation of an infrastructure of redemption centers and the removal of containers from neighborhood stores. Such a system could reduce waste, expand economic activity in the neighborhoods and relieve shopkeepers all at the same time.

Monday, June 20, 2005

China and Sweatshops

As part's of its cover story on the "New Revolution" in China, Time magazine profiles Wal-Mart's affect on the rising world power. Not only is the mega-retailer using an increasing number of Chinese suppliers but they are opening more and more stores within the country. According to the article, there is a general sense that Wal-Mart's presence in China is a good thing for both entities: for the former it keeps prices down, for the latter, it is bringing an American-style business efficiency to land laden with bureaucracy and special favors. However for some there are definite drawbacks:

"Wal-Mart is both a beneficiary and a driver of the race to the bottom in the global economy," says Alejandra Domenzain, an associate director of Sweatshop Watch, a U.S. advocacy group. "It has enormous leverage, and how it uses that leverage in the pursuit of ever cheaper labor has enormous consequences for communities in the United States."
On the issue of sweatshops, the article mentions the following:

In China, where sweatshops are alive and well, the company insists those measures make a difference. Suppliers, including those who sell to Wal-Mart indirectly through other companies, must limit the work week to 40 hours plus no more than three hours of overtime a day, meet safety requirements and provide decent accommodations for workers. Even those critical of Wal-Mart concede that the standards can make conditions at a Wal-Mart supplier's factory more bearable than they are at a lot of other low-wage factories in China. "When the standards are enforced," says Domenzain, "I think they are a step in the right direction. The question is, How rigorously are they enforced?"
The answer: not too rigorously. Besides Time’s mention of the prevalence of document faking to demonstrate supposed compliance there is additional evidence that Wal-Mart’s suppliers in China and elsewhere aren’t treating their employees even remotely well.

In fact, Dateline ran a piece last Friday demonstrating the human cost behind the bargains at places like Wal-Mart. Dateline set up a fake clothing company in order to get access to oversees factories that supply U.S. companies. Despite the assurances of multiple managers that their factories comply with basic codes of conduct, interviews with women such as Masuma, a worker who sews stripes on Wal-Mart pants, tell a different story:

Masuma: “Usually I work until at least 8 pm, but often they will keep us and make us work until 10 p.m.”

And she says she frequently has to work Fridays, the Muslim holy day, which by law is supposed to be a day off. On average, she says she works more than 70 hours a week. At least 10 hours more than allowed by the local law. It's not hard to confirm that many factories exceed that limit.

Masuma says she's paid more like 17 cents an hour, a perfectly legal wage here, and more than many Bangladeshis earn. So for a 70-hour week, she brings home about $12. What kind of life does that buy?

Masuma showed us her home, two small rooms where she says she lives with her mother, two year old daughter, and a couple of other garment workers. There's no table. She makes and eats breakfast on the floor. Their only water comes from a pump they share with neighbors. After paying the rent, Masuma says she cannot afford very much. Her typical diet is rice and lentils. Fish and meat are too expensive, she says. One chicken costs more than she's paid for an entire day.
Read the whole thing.

Wal-Mart Labor Law Violations

In Connecticut, Wal-Mart has broken even more child labor laws:

HARTFORD, June 17 - A state investigation found 11 violations of child labor laws at three Wal-Mart stores in Connecticut, including instances of teenagers illegally operating heavy machinery and working late into the evening, state officials said on Friday.
Considering the numerous violations and the recidivistic nature of the offense lawmakes aren’t too happy about the rather paltry fine:

In the federal investigation, the stores were given advance notice of the investigation, and the Wal-Mart corporation was ordered to pay $135,540 in fines, angering lawmakers and children's advocacy groups, who said the penalty was too small.

Check Please

Kudos to Frank Lombardi for focusing on a major unexamined issue in the trash debate: its immense and escalating cost. Frank highlights the over $1 billion a year price tag for disposing our garbage in out-of-town landfills. The key point is the $1.23 billion earmarked in the capital budget most of which will go to the building of the mayor’s marine transfer stations (We’ll take the over in this bet. There’s no way the price tag won’t skyrocket).

Once again, however, the commercial trash dilemma is left unexamined and, since those transfer stations processing this waste cause a great deal of the neighborhood problems, we’re able to clearly see that the mayor’s proposal is only a decent quarter step in the right direction.

The one point on which the mayor’s people are right on target is the lack of a timely discussion of these issues when the mayor’s plan was first introduced eight months ago. Too often debate becomes last minute and hectic as a key vote approaches. The Speaker should have been working on a critique of the mayor’s plan and have begun hearings on it prior to the whole siting controversy. He then wouldn’t have been as easily attacked for a self-serving opposition the 91st street transfer station.

Term Limits

Term Limits have once again become a hot political topic. When it was last deliberated, the Neighborhood Retail Alliance’s Richard Lipsky was quoted in Newsday as saying:
I am philosophically opposed to term limits but, as far as this Council is concerned I’ll make an exception.
Flippancy aside, the frustration expressed was of an entrenched leadership and a lack of creativity and new blood. Term limits have changed all that. For every new member of the Council who appears clueless we have any number of newcomers who bring new energy and fresh ideas to the legislative body. All of this has been positive.

That being said, there is a strong case to be made for lengthening the term of council members from the current eight to a more realistic twelve. The justification for this change inheres to the structure of New York City’s municipal government which gives the mayor extraordinary powers and resources.

A lengthened council term where, undoubtedly a speaker would be in power for a longer period of time, would allow the body to provide a better check on mayoral power. It would, at the same time, rein in some of the St. Vitas Dance that many members now exude in their incessant nervous pursuit of other political opportunities. It would give council members enough time to become serious lawmakers and build a political resume.

While we’re at it we should point out that the ad hominem argument made by former council member Henry Stern should be viewed purely as a manifestation of projection: Pomposity and vacuousness being his major claims to fame (If you want to discount racial discrimination litigation against the Parks Department).

Sunday, June 19, 2005

Daily News Evolution

While the Daily News continues to hammer away at Gifford Miller, we’re detecting some movement in their analysis of the mayor’s garbage plan. Writing in yesterday’s paper they poke fun at Millers proposal to open 91st street to only non-putrescible garbage. As they pointedly remarked: “Rotten fruit has its proper place. In neighborhoods like the South Bronx, it seems.”

Now our own view is that rotten fruit should not be trucked and stored anywhere in the city. The reduction of this organic waste is a fiscal and public health necessity. And finally, the Daily News admits that the mayor’s plan leaves the garbage literally on the table. Why doesn’t it make more sense to develop a comprehensive waste reduction plan for all of the city’s garbage before deciding on the transfer station locations?

What’s more, no one has ever bothered to analyze the fiscal implications of the following:

1) Building expensive marine transfer stations designed to export garbage to landfills

2) Doing so without proposing any sensible waste reduction policy

Here is where the editorialists and policy makers need to focus all of their attention in the coming months.

Friday, June 17, 2005

Garbage Politics Becoming Putrescible?

The confusion over David Yassky’s role in the upcoming override battle gets more confusing every day. The Crain’s Insider believes that Yassky is partnering with the mayor behind the Speaker’s back but a glowing New York Times “Public Lives” story only says that the iconoclastic councilman is trying to improve the mayor’s “half a loaf” plan. Here is the money quote:

… I'd like to see it improved to, say, three-fourths of a loaf … My preference is that we take the plan that's on the table and improve it, not throw it away in the trash
Meanwhile, Frank Lombardi reports in the Daily News that the Black, Latino and Asian Caucus of the City Council may play a key role in thwarting an override of the mayor’s veto. He reports that the Caucus split almost down the middle with 11 members voting with the mayor and 10 with the Speaker. A switch of one or two votes may make all the difference to the override vote scheduled for Thursday.

The key question is: Did the Speaker’s last minute proposal persuade enough votes? Lombardi reports a Council insider claiming that they have 32 out of the 34 necessary for the override. With a vote this close, and with both sides plying the wavering members with goodies, no outcome can be predicted.

Yassky and the G8

As we posted yesterday, David Yassky is looking to broker a compromise between the mayor and the Speaker on the SWMP and siting issues. The Sun story by Jill Gardiner seemed to imply that Yassky’s role might be undermining the Speaker’s own efforts to override the mayor. The councilmember denies this and claims that his intervention is designed to help the Speaker. A great deal remains unclear in all of this.

What we do know, however, is that Yassky gets it on commercial waste and sees clearly just how the mayor’s SWMP fails in its attempt to grapple with this issue. We’re also hoping that he uses his intermediary position to promote waste disposers for the neighborhood food stores. The Council’s 14 page alternative talks about mandatory commercial recycling but we’ve said all along that allowing grinders will achieve the recycling goals in the private sector without any mandatory legislative initiative.

Waterfront Neighborhood’s Critique Mayor’s Commercial Waste Study

The Organization of Waterfront Neighborhoods (OWN) and the New York Lawyers for the Public Interest commissioned a report to critique the Department of Sanitation’s (DSNY) commercial waste study. The DSNY study (more of the professional expertise the mayor talks about?) was as close to an absolute joke as anything that has even come out of this agency in over 30 years.

The DSNY report, as we have observed already, never even bothers to analyze the commercial sector’s waste generation or the potential for waste reduction and recycling opportunities. It purposefully didn’t include waste disposers in its analysis even though the Department of Environmental Protection had done, with DSNY’s cooperation, a full in-depth evaluation of grinders that had clearly underscored their vast potential benefits in the residential sector.

This nonfeasance at DSNY must raise a whole host of suspicions. We could even accept the situation if the agency had included disposers in its study but, after review, they concluded that the costs outweighed the benefits. But refusing even to evaluate disposers? This in spite of the fact that a NYCHA pilot program using grinders has been an unqualified success at not only helping the housing agency affect a cleaner environment but also at reducing the number of truck pick-ups at the Baruch Houses on the Lower East Side.

OWN’s Tunnel Vision

The hilariousness of the DSNY report, however, isn’t limited to its total refusal to actually examine the full gamut of the commercial waste stream. The professionals who did the study limited themselves to the environmental impact of siting in the neighborhoods currently saturated with transfer stations. Here the OWN report rightfully mocks the DSNY conclusion that the clustering of these garbage sheds won’t, in the long term, damage the host communities.

What’s hard to understand here is, if siting has been found to be a non-issue by DSNY’s experts (in thousands of pages, of course) why is the mayor trumpeting his siting plan for its environmental benefits to the waterfront neighborhoods of Brooklyn and the Bronx?

Yet OWN’s own report also limits itself only to siting and never bothers to touch the crucial waste reduction variable. We can understand the DSNY position (read Thorsten Veblen’s discussion of “trained incapacity”) which seems to say that there is no need to examine waste reduction since the current infrastructure and host communities are generally able to continue to handle the trash volume. But OWN, with its emphasis on over-saturation, has no such excuse.

Neighborhood Stores in the Bull’s-eye

A careful reading of the SWMP, along with a little handwriting on the wall analysis, clearly points to the eventual use of the neighborhood food store as a cash cow for the city-run transfer stations. The mom-and-pop commercial waste facilities will be closed and the city will direct all private garbage to its own plants. In a move that would make even Angelo Ponte blush, this city-sponsored monopoly will use escalating tipping fees to subsidize their own operations while beating small businesses to a pulp.

Overheard at the Bronx Democratic Dinner

At Wednesday’s Bronx County Democratic Dinner we ran into the Borough President himself, the always unflappable Adolfo Carrion. Although we have had our recent disagreements there is no denying that he is a major political talent.

When we chatted we pressed him on the BJ’s tenancy issue at the Bronx Terminal Market. He pretty much flatly denied that the box store was in the mix which, if true, is very good news indeed. Carrion’s observation was reiterated by Joel Rivera as well as new councilmember Maria del Carmen Arroyo (Arroyo represents the BTM district). She also told us that she was extremely interested in meeting with the merchants and finding a solution to their long term viability. Her intervention and help would be a boon for the beleaguered vendors.

Thursday, June 16, 2005

Healthy Criticism

New Republic Senior Editor Jonathan Cohn writes in this week's issue that much of the current effort against Wal-Mart centers around the issue of health care:
While critics have long attacked Wal-Mart for everything from destroying mom-and-pop stores to exploiting cheap foreign labor, the focus of the present controversy is health insurance. According to published figures, Wal-Mart insures less than half of its U.S. workforce. (Costco, considered by many to be Wal-Mart's nearest competitor, insures 96 percent.) What's more, the coverage that Wal-Mart does offer frequently includes large deductibles that leave employees exposed to heavy out-of-pocket costs. Labor activists and their allies say that such a profitable company owes its workers more than that. Last month, the Maryland state assembly signaled its agreement by passing a bill that would have required Wal-Mart either to spend more on employee health benefits or pay an equivalent amount in taxes to help underwrite the state Medicaid program, on which many Wal-Mart employees rely.
Cohn mentions that Wal-Mart spokespeople point out that the health care crisis in the U.S. is broader than just one company. He agrees but says this assertion is disingenuous because Wal-Mart has consistently blocked the reforms needed to fix the system. First, he says, some context is needed:

To understand why, you need to understand how American workers came to depend on companies like Wal-Mart for health benefits in the first place. In most of the Western, developed world, governments organize health insurance-- guaranteeing coverage as a right of citizenship, mandating minimum benefits, and financing care, primarily through taxes. But efforts to bring universal health care to this country have always run up against opposition from the business community, which opposed government interference in the private sector. To corporate America, the only acceptable way to ease public access to health care was private health insurance, which it embraced starting in the 1930s.
This reliance on private employers for health care, though, is not working:

But, in the last two decades or so, as medical costs have skyrocketed, unions have atrophied, and the pressure to squeeze labor costs has intensified, employers have been rethinking the commitment to employee benefits. Many companies engineered (or reengineered) their workforces so that fewer employees were eligible for coverage; others ratcheted back coverage, transferring more costs to employees. All of this has made Wal-Mart a model other companies emulate--if not out of admiration, then out of perceived necessity.
For Cohn, while the efforts to legislatively force Wal-Mart and other large corporations to pay for their workers health care is commendable, it may not be the long term solution:

But this notion also assumes that the employer system is really worth keeping--which may not be the case. The system made a lot more sense back in the 1950s, when a breadwinner might spend decades or a whole lifetime at one full-time job. That's not true anymore.
He then describes the need for a complete gutting of this system – a task, he admits, that will be far from simple – and how companies like Wal-Mart and their Republican allies have inexorably fought these reforms, including the possibility of universal health care:

And they're still fighting. In the last election cycle, 80 percent of the donations from Wal-Mart's political action committee and individuals associated with the company went to Republicans, whose opposition to anything resembling universal health care is well-known. While Wal-Mart itself has not taken an official position on national health insurance, it's not hard to guess what the company would think about it. Suffice to say you won't hear Wal-Mart championing France's universal health care system. Wal-Mart is entitled to its opinion, of course. But, as long as it blocks real health care reform, then it deserves every bit of grief it's getting.

Queens Politicians Cautious in Support of Stadium

Albor Ruiz has an interesting column in today’s Daily News pointing how Queens pols, though supportive of the Olympics coming to New York and the attendant new Mets stadium, are striking a cautious tone.

Our community deserves careful planning and consideration for the environmental impact that the project would have on our children, and the infrastructure adjustments that must be put in place," warned Councilman Hiram Monserrate (D-Corona).
Councilman Tony Avella added:

"Before I can support the Queens Olympic stadium proposal, I need to know how the city intends to deal with the huge traffic problem that will be generated not only by the actual Olympic events but also with almost eight years of construction activity."
Ruiz points out that others want to insure that the community has a voice in and benefits from the proposed development:

"I've been talking to the Mets for over two years about a community partnership agreement. And for two years, they've been balking at the opportunity," said Assemblyman José Peralta (D-Corona). "Now is the time for Wilpon to step up to the plate and work not only for the Olympic stadium, but for the long-term benefit of the community."
Both of these issues – mitigating the side-effects of new development and making sure that the surrounding communities are involved – reinforce the need to fairly deal with the 500+ Willets Point merchants who would have to be relocated when redevelopment occurs. It also highlights the inadequacy of the current Bronx Terminal Market redevelopment where there has been no community input and no plan to preserve existing merchants.

Council Trash Plan

The Council announced its new trash plan alternative yesterday in an attempt to resolve the impasse caused by the mayor’s veto of the legislature’s thumbs down on this transfer station siting plan. If first reports are accurate, however, it doesn’t appear that the mayor feels the Council plan is a viable one. As Bloomberg remarks in Nicholas Confessore’s New York Times story today:

We will go ahead with a well-thought-out plan…A plan made by professional environmentalists [an oxymoron?] and experts in waste disposal [another one?] and in traffic.
Clearly, the Council’s objective here is to get enough additional votes in the body (five are needed), to override the mayor’s veto. Once this is done, than real negotiations can begin over redrafting what is unquestionably a limited-vision plan for the city’s waste disposal.

Who are the G8?

On the same front, Jill Gardiner is reporting in the Sun that a mysterious group of eight council members has formed to act as a negotiating buffer between the Speaker and the mayor. No one in the group is identified except for Councilmember Yassky who is reported to be its leader.

What this means is that there will be a wide range of interests as well as pressure points in the upcoming SWMP battle. If the override is achieved it will be interesting to see if the Speaker, post-budget, will be able to negotiate a plan without the whole process degenerating into a free-for-all.

Update: Over at The Politicker: Ben Smith gives his take on the G8 issue and mentions that Yassky called him to deny that he's the lead negotiator. Check out the post's comments as well. As we know, certain Politicker readers are liberal with the "anonymosity."

Willets Point, A Queens Stadium and the Bronx Terminal Market

We attended Hiram Monserrate’s press conference Tuesday on the Queens stadium and as usual the councilman stood up for small business, this time for the hundreds of Willets Point car repair shop owners. The current vision for redeveloping the Shea Stadium area for the Olympics includes placing a number of new facilities where these existing businesses now stand. Unfortunately, this situation is eerily similar to the Bronx Terminal Market situation where little or no concern is shown to mom-and-pop operators that have been in the community for years and provide and are vital to the economy.

(We must point out that Councilman Tony Avella of Queens is backing Councilman Monserrate’s position 100% and, after talking with him at last night’s Bronx Dinner, we were happy to hear him reiterate his desire to see the Willets Point businesses treated equitably).

What makes the case intriguing is that there are close to 500 automobile businesses in Willets Point. The estimate is that there may be at least 5,000 people working in the area targeted for condemnation. Most of the business owners as well as their workers are new immigrants who live and work in Queens. The key issue will be: How do we preserve these mostly thriving businesses in the face of redevelopment?


As usual, the perspective of the city appears to be that a “blighted” or “slum” area needs to be renovated. No one who visits Willets Point Boulevard and 126th Street will ever confuse it with 5th Avenue but that doesn’t take away from the fact that the area is a hub of significant economic activity. And, if you want to consider the area bighted then who but the city is to blame for these conditions? After all, what other area of New York hasn’t had its road paved in 50 years?

Wither John Liu?

In Paul Coldford’s story in yesterday’s Daily News there were extensive quotes from Councilmember John Liu who represents Flushing, the area directly abetting Willets Point. John speaks glowingly about the development opportunities at Willets Point but offers no caveats or concerns about existing businesses.

This is disappointing but not surprising. As a member of the Council’s Consumer Affairs committee Liu has consistently taken positions that are hostile to small business. In hearing he has voiced his support for legislation increasing the vendor presence on city streets and has also backed a bill to increase the enforcement powers of the Department of Consumer Affairs.

Now is the time for John Liu to send a signal to his own small business community – the thousands of Chinese and Korean storeowners in his district – that he can also be a champion of the little guy’s interests. Needless to say, Liu has a lot of convincing to do.

For additional coverage of Monserrate's press conference in the Spanish media check out this El Diario story as well as this story in Hoy.

Wednesday, June 15, 2005

Mayoral Veto: Trash War is On

The mayor, in a three page veto message, outlined his position of support for his SWMP. Unsurprisingly, he focused on the environmental justice issue of siting transfer stations, the one major area of vulnerability for the Speaker.

The key point of contention will be the 91st transfer station. If Miller accedes on this point he can’t possibly expect to win a mayoral primary. To get the mayor to compromise, however, he will need to come up with a credible waste reduction plan.
All of this will have to be resolved at next stated meeting on the 22nd.

Tuesday, June 14, 2005

Disappearance of the Neighborhood Market

In today’s New York Sun Lauren Mechling writes nostalgically about the disappearance of the local neighborhood supermarket. The focus of the piece is the closing of D’Agostino’s in Brooklyn Heights in the face of the onslaught of specialty stores like the Garden of Eden.

The story has a decent credibility when you look at certain neighborhoods but does not hold up when you look at the entire city. The low income neighborhood shopping strips of New York are still anchored by independent supermarkets run by immigrant entrepreneurs. Poor and working class communities are not pining for the next Whole Foods but are more interested in fresh food at reasonable prices. This is what these supermarkets are doing well.

Suggestion: Lauren let’s take a tour of these stores and you’ll have an excellent story about how a group of immigrant storeowners, investing tens of millions of dollars, kept entire commercial areas of this city from going down the tubes during the 1970s.

Bloomberg Reaches Out to Local Supermarkets

We’ve heard that the mayor has reached out to the National Supermarket Association leaders. The NSA, a predominately Dominican trade group, represents around four hundred independent supermarkets throughout the city.

The mayor’s outreach is definitely a step in the right direction. He is setting up a task force to examine the needs of the industry. What the NSA leaders need to do, however, is to come up with a couple of concrete policy ideas in order to avoid the whole exercise deteriorating into a meaningless symbolic gesture. Our suggestion would be to ask the mayor to do the following:

1) Support a pilot program from commercial waste disposers – This would save the industry millions in yearly garbage disposal costs

2) Remove BJs from the Gateway Mall – There are minimally 25 independent supermarkets, on both sides of the Harlem River, that would be negatively impacted by a BJ’s at the Bronx Terminal Market site. The mayor should be told that it is unacceptable for the city to put tens of millions of dollars in public money into this project and, when all is said and done, allow the developer to tenant the site with a retailer who will put the investment of these supermarket owners at risk.

"Junkyard Nabe"

Adam Lisberg in the Daily News is the only one of the local reporters on the Mets Stadium story to focus on the fate of the businesses in Willets Point. We’re sure that this will become a focus for everyone else as the plans for the ballpark are finalized and the awarding of the development is, according to sources, revealed next week.

There is no question that the area is, in Lisberg’s words, “the madcap bazaar of garages and junkyards.” This does not take away from the fact that there are scores of small businesses, many run by new immigrants, that need to be protected. A real compensation and relocation plan needs to be part of any redevelopment scheme.

Councilman Monseratte, who represents the area, is holding a press conference at Shea today at 2 p.m. with a number of the impacted businesses owners. The likelihood is he will announce tentative support for the stadium with the proviso that a plan for the business people needs to be part of the proposal.

This new stadium proposal presents an opportunity for the mayor to demonstrate that his administration can do large scale development while remaining sensitive to the needs of local small businesses.