A special investigation
By LOUIS FLORES
Updated 29 July 2015 09:35 ⎪ The administration of Mayor Bill de Blasio (D-New York City) is advancing with its plans to further privatize city real property that is part of public housing developments.
Given that the mayor was on vacation when the latest plans were announced, news was transmitted via press release that plans called for the leasing of undeveloped lots of the New York City Housing Authority, or NYCHA, under an arrangement that Mayor de Blasio had once criticized after the administration of former Mayor Michael Bloomberg (R-New York City) had first begun to promote a similar proposed land-lease program.
To manage the optics of further privatizing city real property (This is not the first time that the de Balsio administration was set to give private real estate developers the right to construct on NYCHA properties.), the de Blasio administration promised to make 100% of the apartment units that are first developed under its land-lease plan to be affordable. After publicizing that these first apartment buildings will be 100% affordable, the de Blasio administration is expected to announce in August an update about its plans for still yet further land-lease opportunities, for which private developers can submit bids to construct apartment building that will be split 50%-50% between affordable and market-rate housing. The decision to lease city real property to developers was made without subjecting the plans to the city’s typical land use review procedure.
According to the mayor’s first phase of NYCHA land-lease plan, the 100% affordable housing units are to be constructed on green space in the Raymond V. Ingersoll Houses in Fort Greene, Brooklyn ; on a parking lot of the Van Dyke Houses in Brownsville, Brooklyn ; and on a parking lot of the Mill Brook Houses in Mott Haven, the Bronx.
As noted by a report written by Dana Rubinstein and published by Capital New York, in respect of the 100% affordable apartments that are first being developed under the land-lease program, NYCHA “anticipates the construction of between 400 and 500 units across all three developments, but is allowing developers to ‘respond to the R.F.P. with a proposed unit count,’” referring to the request for proposal that NYCHA was announcing.
The 400-500 units that NYCHA expects to be built, which are being touted as making advances in creating more affordable housing, are substantially less than the 2,000+ public housing units that Comptroller Scott Stringer (D-New York City) revealed in an audit had been being left vacant by NYCHA, according to a report written by Emma Whitford and published by Gothamist.
These new units are being relied upon to add to Mayor de Blasio’s stated goal of preserving 120,000 affordable housing units and building 80,000 new units of affordable housing over a ten-year period, even though he will be in office for only seven of those ten years. Mayor de Blasio’s affordable housing plan was more fully-detailed one year into his first term, during his annual state of the city speech delivered on February 10, 2015. The administration’s combined 200,000 unit plan, and the actions he has been taking to achieve that goal, are not enough to counter New York City's housing crisis, some activists say.
Of other notable projects in the administration’s plans to expand affordable housing, Alicia Boyd, a Brooklyn activist, who has been organizing around tenant issues, said “There’s no provision for people, who are the most heavily rent-burdened in New York City,” referring to an affordable housing agreement that the de Blasio administration had negotiated with developers in Queens, adding that, “The most heavily rent-burdened people are people between no income to $32,000 in income range. These are senior citizens that might be on Medicaid or Medicare, people, who are on disability or social services. No provisions are being made for that community group.”
Ms. Boyd also said of the Queens plan, “When you're talking about the [area median income] of communities, especially communities of color, he’s really not talking about providing them with any type of affordable housing at all, except for that small percentage between $32,000 and $42,000,” referring to an income range where the de Blasio administration’s affordable housing plan has been noted falls short of its own goals.
In some instances, Ms. Boyd pointed to the high range of income that tenants can earn under some of Mayor de Blasio’s affordable housing plans, income that can stretch into the six figures, numbers earned by families to whom the federal government could not justify providing affordable housing assistance, Ms. Boyd noted. In her interview with Progress Queens, Ms. Boyd said that this band of high-income range would capture government legislators, implying a lunacy to providing housing assistance to elected officials before providing housing to low-income senior citizens receiving medical assistance, for example. Yet, Mayor de Blasio’s affordable housing plan really does include provisions for these high-income earners.
What is deemed affordable to the de Blasio administration shifts, in order to help the mayor reach his goals. For example, the first affordable housing building constructed on the Atlantic Yards development in Brooklyn was touted by Mayor de Blasio as 100% affordable, even though it was expected to set aside half of its units to families, who earned approximately $138,000 per year. The other half of the building was expected to be set aside for tenants earning less than $50,000. To some activists, families earning six figure salaries were not the tenants, who had been being squeezed the hardest by the gentrification and resulting high prices of rents causing New York City’s housing crisis.
Mayor de Blasio’s affordable housing plan is primarily targeted to those tenants, who proverbially “already possess a piano,” as Frederick Engels wrote in Part Two of The Housing Question, referring to tenants, who were in the lower middle class and who had aspirations of moving higher. Mayor de Blasio’s plan most glaring failure is in its lack of focus of directing all of its energies to providing assistance to tenants, who make the least income. Making matters worse is the fact that for people, who make no to little income, those fortunate to live in project-based Section 8 apartments are seeing the ownership of their buildings being transferred from the city’s housing authority to consortiums of private developers, starting a countdown clock until those project-based Section 8 apartments become deregulated. A further failure is the mayor’s lack of a plan to attack the determinants and conditions that lead people to homelessness, a complicated subject that will not be examined in this article other than pointing out that rather than using city resources to expand public housing to transition homeless shelter residents into permanent housing, the de Blasio administration appears to be ring-fencing the problem to the city’s over-burdened shelter system and privately-run half-way and three-quarter houses, an approach that provides no transformational, much less progressive, solutions for individuals with no permanent housing to call their own.
The NYCHA sale of Section 8 buildings
Regarding the transfer of Section 8 buildings, the de Blasio administration sold several project-based Section 8 buildings owned by NYCHA, including green spaces, parking lots, and playgrounds, to a consortium of real estate developers that included NYCHA. As first reported by Progress Queens, this sale, which was negotiated in secret and took place last December, included the right for developers to build on the undeveloped lots that had been sold along with the Section 8 buildings.
Although de Blasio administration officials had claimed that those Section 8 buildings had been too dilapidated for NYCHA to maintain, as shown in the Progress Queens report, at least four buildings received substantial improvements in the months before their sale. Officials from the de Blasio administration refused to comment at the time of the Progress Queens report, and, in the time since, no administration housing official has been made available to Progress Queens for subsequent reports, including this report.
The four refurbished Section 8 buildings, located at 930 Halsey Street and 55 Saratoga Avenue, both in Bedford-Stuyvesant, Brooklyn, and at 1780 and 1782 Madison Avenue, both in Spanish Harlem, Manhattan, had scaffolding wrapped around the buildings, according to photographs dated September 2014, and posted to the Internet by Google Street View, indicating that the exterior of the buildings were receiving substantial repairs. Workmen can be seen suspended against the façade of 930 Halsey Street and the side of 55 Saratoga Avenue, according to a Google Street View image of the buildings. The Google Street View images were taken in September 2014, and three months later, in December 2014, the sale transaction of the buildings was closed, raising questions about whether taxpayers were paying to spruce-up the conditions of the Section 8 buildings that may have been sold under distressed circumstances.
The sale of the Section 8 buildings was made under the guise of necessity. In an interview with Progress Queens conducted last February, Councilmember Ritchie Torres (D-The Bronx), chair of the City Council committee on public housing, defended the sale of the properties, saying that, “Even though I support it as a necessary evil, it brings in the money” to properly maintain the properties, Councilmember Torres told Progress Queens. Otherwise, the “buildings would have become unlivable in 10 to 15 years,” Councilmember Torres added.
Without explanation and contrary to the secretive 2014 sale of the Section 8 buildings, the de Blasio administration publicly announced a Request for Proposal, or RFP, for NYCHA’s 2015 land-lease plan, moving forward with the further disposition of city real property with no specific mandate from voters.
Is the real estate industry getting free reign over New York City, because of its strong campaign support for de Blasio ?
To some progressive activists, seeing Mayor de Blasio’s land-lease proposal following so closely on the sale of the Section 8 buildings, with plans for further expansion of land-lease opportunities, amounts to a full-throttle assault to privatize large parts of NYCHA, essentially opening the floodgates for private real estate developers to stampede toward a land rush of city real property in exchange for the administration receiving credit for the construction a miniscule number of new affordable housing units. It seems like a huge price to pay for perhaps constructing an initial 500 new affordable housing units within a larger goal of creating 80,000 units over a ten-year span.
During his 2013 mayoral campaign, Mayor de Blasio turned to real estate lobbyist James Capalino, for political support. Mr. Capalino became a campaign volunteer and served on the host committee credited with expecting to raise $1 million for Mayor de Blasio’s 2013 campaign at a fundraiser at the Waldorf-Astoria. However, this early warning sign was ignored by many activists, because, during that campaign, then Public Advocate de Blasio campaigned as the self-annointed progressive alternative to the fourth term of the Bloomberg administration that his chief political rival, former City Council Speaker Christine Quinn, had represented in that year’s Democratic Party mayoral primary. Activists, including many of the “Anybody But Quinn” activists, who were working for the de Blasio campaign, either naively took him at his word that he was a progressive or didn’t care about being undisciplined in their support of a candidate suddenly demonstrating a heavy reliance on real estate interests.
As previously reported by Progress Queens, Mayor de Blasio’s embrace of the 421-a tax abatement program, nominally reformed to the liking of the Real Estate Board of New York, or REBNY, the industry’s lobbying group, came as a shock to some liberal-minded activists. Many had expected Governor Andrew Cuomo (D-New York), a neoliberal Democrat with financially-conservative leanings, to broker a REBNY-supported plan to renew the briefly expired tax abatement program. Mayor de Blasio’s triangulation with REBNY resembled the kind of big business deal-making of former Council Speaker Quinn.
Indeed, the developer Rob Speyer, the developer William Rudin, and the Partnership for New York City President Kathryn Wylde, once former allies of former Council Speaker Quinn, have now become supporters of Mayor de Blasio.
Mr. Speyer has been described by The New York Times as “close” to Mayor de Blasio. Mr. Speyer even co-hosted a birthday party for the mayor. Mr. Speyer was also named as a co-chair to the mayor’s doomed Democratic National Committee host committee. The company that Mr. Speyer chairs has also been a contributor the Mayor de Blasio’s official nonprofit group, the Mayor’s Fund to Advance New York City.
Mr. Rudin has hosted several appearances by Mayor de Blasio at his real estate trade group, the Association for a Better New York. When Mayor de Blasio announced promises to update workforce development programs that would train low-income New Yorkers for high-skilled jobs, the de Blasio administration reached out to Mr. Rudin for affirmation from the big business community. Mr. Rudin has also been a contributor, through two foundations, to the Mayor’s Fund to Advance New York City.
When Mayor de Blasio first charged into City Hall with a mayoral agenda to curtail the spread of charter schools in the city, big business leaders, like Ms. Wylde, publicly embarrassed the mayor by questioning whether the mayor wanted to mutually work with the business community. After that mild reprimand, Mayor de Blasio eased up, so much so that when Mayor de Blasio was engaged in an escalating war of words with Governor Cuomo after the conclusion of this year’s state legislative session, Mayor de Blasio turned to Ms. Wylde for support. In remarks made to The New York Times, Ms. Wylde derided the culture of Albany as “transactional” and defended the mayor, even though the term could just as snugly fit the culture of City Hall, given Mayor de Blasio’s own lack of political discipline, as noted by legendary investigative reporter Wayne Barrett in a column for The New York Daily News.
As Public Advocate, Mr. de Blasio once stood outside the shuttered St. Vincent’s Hospital in the West Village of Manhattan to say, “Hospitals, not condos.” He did the same outside Long Island College Hospital, or LICH, on numerous occasions in 2013, so much so, that healthcare activists looked onto Mr. de Blasio as the first prominent government official to expend so much political capital to publicly fight the wave of hospital closings first ordered under the conservative budget ax of the Berger Commission. But a strange thing happened between Public Advocate de Blasio and Mayor de Blasio. His machinations eventually came to match the broken promises, the community betrayals, and the official failures of former Council Speaker Quinn. Soon after his swearing-in, Mayor de Blasio had appointed so many officials to his administration from New York University that The New York Post expected the de Blasio administration to support the university’s “Dorms, not parks” expansion in the West Village, an almost immediate flip in his apparent philosophy on land use. Not long after that, other officials in the de Blasio administration began to defend the construction of apartment buildings in Brooklyn Bridge Park in Brooklyn Heights, Brooklyn, essentially saying, “Condos, not parks.”
And not much longer after that, LICH was disconnected from life support, to eventually become harvested for luxury condos, a revelation that many healthcare activists and Brooklyn residents took as a signal of then Public Advocate de Blasio’s machinations to exploit orchestrated photo ops of civil disobedience just to win the 2013 mayoral primary.
Further analysis revealed that Mayor de Blasio was cultivating a working relationship with the real estate industry from the outset of his administration. Recently, the left-of-center magazine, Jacobin, resoundingly criticized Mayor de Blasio’s affordable housing plan, with the journalist Sandy Boyer writing that, “The mayor has come down firmly on the side of the real estate millionaires.” Contrary to the scare tactics of the de Blasio campaign, the frightening pro-real estate monster in City Hall was supposed to be former Council Speaker Quinn, not Mayor de Blasio. That the real estate industry has nonetheless been able to exert great influence over the de Blasio administration reveals the political reality about Mayor de Blasio’s reliance on big money campaign contributors.
“Anybody, who runs for mayor, in order to have a real chance of running and winning, you need a huge amount of money,” said John Fisher, the tenant activist and founder of the tenant resource Web site, TenantNet, adding that, “Unless you are Michael Bloomberg, you need to raise money.”
An astute political observer, Mr. Fisher told Progress Queens that professional politicians, like Mayor de Blasio, came up the party ranks, meaning, that he knew how the game was played. Mayor de Blasio knew what it took to raise the funds needed to wage successful political campaigns. Therefore, he accepted campaign contributions from big money donors knowing that the donors might be expecting access and other special treatment in return. He took hedged stances to create wedge issues against his primary opponents, and he delivered statements on his stances in what basically amounted to politically-timed events to maximize press coverage to garner free political publicity.
In other words, all of these indications are the machinations of a well-greased political machine, not those necessarily of a reformer.
Given how much entry real estate interests are being given to buy or develop on city real property, can electoral politics and the need to raise large sums of campaign contributions be the simple explanations for Mayor de Blasio’s close embrace of the real estate industry ? This is a question for activists and voters to explore, so that the community can propose solutions.
It is undemocratic for real estate interests to receive special treatment on land use matters
Mayor de Blasio’s turn-about in respect of the land-lease proposal for NYCHA was not so much of a flip-flop, because, before the 2013 mayoral election, when then Public Advocate de Blasio was publicly criticizing the Bloomberg land-lease proposal, Public Advocate de Blasio qualified his misgivings by saying that if such a proposal could be “carefully constructed,” then he wouldn’t rule out such a modified proposal, so long as such a modified proposal wasn’t “the way it was done by Bloomberg.”
Mayor de Blasio’s rush to embrace the land-lease infill program first proposed by former Mayor Bloomberg follows the mayor’s embrace of the trickle-down economics of the 421-a tax abatement program to incrementally add to his goal of creating more affordable housing units and points to a larger doctrine that is more neoliberal than progressive, in spite of the steady drumbeat of the media, which continues to perpetuate Mayor de Blasio’s self-created myth that he is a progressive. To further develop a public-private partnership between the city and real estate developers, the de Blasio administration’s affordable housing goals have been tied to the rezoning of 15 New York City neighborhoods, emphasizing his reliance on creating new opportunities for greater, overall real estate development to help him reach his plan’s goals. The decisions to rezone 15 neighborhoods and the selection of the neighborhoods were made without prior public input before the plans were announced.
Returning to the mayor’s land-lease plans for NYCHA, there are three notable problems : (i) the affordability requirement is tied to a percentage of area median income, or AMI, a figure that can spiral upwards in real dollar values as ensuing gentrification draws in a wealthier influx of tenants into the neighborhood, (ii) if NYCHA wanted to incrementally accommodate 500 more tenants, then the city housing authority should move new tenants into some of its reported 2,000+ vacant apartments ; and (iii) the loss of open spaces will decrease the availability of air and sunlight into existing apartments, a possible violation of the spirit of the tenement reform acts passed by the state legislature during the Progressive Era at the start of the 20th century.
What is more, if Mayor de Blasio is adopting a housing policy that is dictated by the free market system, then it would stand to reason that he should be pushing for the conversion of tenants into homeowners, so that there could be a real effect to creating a participation in the wealth that the city’s real estate creates. Instead, Mayor de Blasio’s plan leaves tenants as tenants, highlighting a lack of a homeownership aspect to the mayor’s affordable housing plans. There could be two reasons for this oversight.
First, the mayor could be trying to avoid any unnecessary painful reminders of the 2008 financial crisis and related mortgage meltdown by foregoing any homeownership assistance, at least for those tenants, who could realistically afford to buy affordable cooperative apartments in this market. The mortgage bond market bubble and subsequent lending squeeze, followed by the great recession, were caused by some of the mayor’s partners in his public-private partnership. If Mayor de Blasio wanted to overcome concerns about his public-private partnership, then there should be more of a sensed bilateral benefit to tenants than just incremental jumps in the number of affordable housing units made possible only through the privatization of public assets.
Second, the mayor would have to revolutionize tax policy to help working families buy affordable cooperative or condominium apartments. This would be in contravention of the 421-a tax abatement program, which currently benefits influential real estate developers and the wealthy owners of expensive luxury condominium apartments. Since current municipal property tax policy is not designed to assist affordable cooperative apartment owners, many such owners are in arrears on their property taxes, according to a report published by The Wall Street Journal, representing the absence of a progressive economic agenda to deal with income and wealth disparities.
Ms. Boyd, the housing activist, noted that all of the affordable housing being created under the de Blasio plan include limits on the duration of affordability. Consequently, there is no intention to make affordable housing permanent for New York City residents. Regarding the lack of an ownership aspect to the de Blasio administration’s affordable housing plan, Ms. Boyd noted that if the plan were to offer low-income residents the permanency that ownership could possibly offer families, that, too, would be in contravention to city planners’ goals of making New York City a much wealthier city, because providing low-income residents permanency would interfere with efforts to attract high-income workers, the latter which, Ms. Boyd said, was city planners’ ultimate objective. Furthermore, Ms. Boyd said that the creation of affordable ownership would also lead to the empowerment of new owners, who would, in turn, demand more accountability from government.
“When you buy, one thing people understand or what our political system responds to, is they believe that people will own, will take more ownership, so they will become more responsible,” Ms. Boyd said, adding that homeowners will be “more responsible to the political system, and they make the political system more responsible.”
Enfranchising low-income residents would essentially give an entire segment of the city’s electorate resources to force the political system to address their needs, something that elected officials, real estate developers, their lobbyists, and other permanent government insiders, who are not interested in such a form of government reform, do not want to see happen, some say.
“They don’t want more people demanding of them,” Ms. Boyd said of government officials and big business leaders, adding, “They want less people demanding of them. So, they are not going to encourage that,” Ms. Boyd said, of making housing policy to include ownership or to include permanency of affordable apartments, adding that, “because they don’t want the poor and the working class in New York City. They’ve made it very clear by their housing policies. And I’m not talking about what they’ve said. I’m talking about what they’ve done. They’ve made it very clear : The poor is not welcome here. If you are in a housing crisis, why do you sell off NYCHA housing ? NYCHA housing is the only housing currently available to people where they are not renters. You can be poor and living in NYCHA housing and not be a renter, I mean, [where] not more than a third of your income can be applied to your rent – the only housing.”
Of Mayor de Blasio’s treatment of NYCHA, Ms. Boyd said, “That really says that you don’t really want the poor in the city.”
In Ms. Boyd’s own Brooklyn neighborhood of Prospect Lefferts Gardens, the tenants of 51 new affordable housing units will only be able to benefit from the mayor’s affordable housing plan for 20 years, after which those apartments will become deregulated and available to be rented at market-rate rents.
The public has little to no input on de Blasio’s land use
When Mayor de Blasio first began to discuss early elements of his affordable housing plan, he did so at a private event hosted by the REBNY, the influential lobbying group of real estate developers. "It's going to take a willingness to use height and density to the maximum feasible extent. ... I don't have a hang-up about it," Mayor de Blasio is reported to have told REBNY officials, adding that, "I think it's necessary to do what I'm here to do." That meeting was closed to the press, according to a brief report of the private meeting recounted by the journalist Dana Rubinstein and published by Capital New York. Ms. Rubinstein noted about Mayor de Blasio’s willingness to embrace large-scale projects to support his affordable housing goals, a decision that the public had no participation in reaching. “De Blasio's embrace of height and density, while potentially jarring to some of his supporters, are in keeping with his history. As a councilman and public advocate, de Blasio was, broadly speaking, aligned with the Bloomberg administration on its development projects, including, most famously, on Atlantic Yards,” Ms. Rubinstein wrote in her brief report.
Not long after East New York in Brooklyn was identified as the first of 15 neighborhoods to be rezoned in accordance with Mayor de Blasio’s affordable housing plan, another plan where the public had no input in forming, community residents and planning experts began to see through the plan. Referring to Mayor de Blasio’s plan, Tom Angotti, a professor of urban affairs and planning at Hunter College and the Graduate Center told the journalist Gerard Flynn for a report in Gothamist that, "It will please big developers while offering a sprinkling of housing," adding of Mayor de Blasio's plan, “It's no different than Bloomberg's plan to upzone wide areas for high-rise development and then get a little bit of affordable housing to win over the community." Eventually, local residents’ unease yielded to protests in the community and outside City Hall against the mayor’s proposals.
The de Blasio administration cannot solve the affordable housing crisis, as Mr. Engles predicted, because the government is a representation of big money interests. As will be shown below, the developers are partnering with Mayor de Blasio out of a motivation to profit from real estate projects, not from a sense of philanthropy. Given how Mayor de Blasio is heavily relying on the private interests of real estate developers to achieve his affordable housing goals, big money interests will be in a position to be able to exert influence on Mayor de Blasio in exchange for his reliance on developers. This encumbered relationship was not exactly what some activists expected, when some activists made the claim during the 2013 mayoral election that an actual Mayor de Blasio would be better than a possible Mayor Quinn. To prove their point, some activists exerted pressure politics to vote former City Council Speaker Quinn out of office based on her poor record. Now that Mayor de Blasio has shown himself to embrace the same policies once universally ascribed to former Speaker Quinn, for which she was derided and rejected, the anti-Quinn pressure politics tactic that led to some changes in city government are nowhere to be found. Instead, Mayor de Blasio gets a free pass.
No matter that government reform activists have demanded a course for a post-Occupy Wall Street city that was not aligned with big business, some activists have told Progress Queens that they believed that the city still needed an economic engine to drive up the tax base, to provide jobs, and to serve as an over-all basis for the New York economy. For one such principal activist, who has a long history of organizing political protests across various issues, the real estate industry was a viable economic driver.
Another bargain made by activists was to abandon a proposal to demand a moratorium on the transfer of city real property until the city and the state could create a sufficiently empowered and funded authority to prevent the closure of any more hospitals in New York City, particularly in Brooklyn. The idea for a new state authority was the brainchild of the de Blasio campaign, but a team of lobbyists, institutional supporters, and activists were entrusted with carrying forward the proposal for the authority in the time leading up until the Democratic Party primary in 2013, after which, once it became clear that then Public Advocate de Blasio had basically become the mayor-elect, the organizing fizzled out, but not before the organizers ditched the proposed demand for the moratorium, because it was deemed too controversial. The only way it would have been deemed too controversial, according to information obtained by Progress Queens, was if the organizers loyal to then Public Advocate de Blasio knew that, once the public advocate became the mayor-elect, he would not accept such an adversarial political demand made of him by activists, much like he would not accept any adversarial political demands made of him by any nonprofit group. If mayoral candidate de Blasio knew that he already had plans for the use of city real property and would have a need to work closely with the real estate industry, a moratorium on the sale of city real property would have impinged on his plans, rendering the short-lived moratorium proposal unacceptable.
A former elected official, who participated in the organizing for the proposed Brooklyn hospital authority, did not respond to a request made by Progress Queens for comment for this article.
The main issue with taking the demand for a moratorium off the table was that that decision may have opened the door to a continuation of the public’s loss of having any say in matters of land use. The loss of this demand was made without input from the public, representing a further disenfranchisement of voters and a reflection of the elitist bent to activism that is sometimes present in New York City under the guise of the noble-minded advocacy on behalf of the economically and politically disenfranchised.
One possibly mitigating consideration is that since Wall Street as a driver of the New York City economy fell out of fashion as a result of the Occupy Wall Street movement, perhaps the de Blasio administration was willing to embrace a less controversial industry to serve as the big business anchor of his embryonic administration. However, the real estate industry has been replete with examples of controversies and corruption. In any case, the big business motive to profit from its dealings with the city, as will be shown below in respect of the NYCHA land-lease plans, essentially drove home the point that any public-private partnership has already been fixed in favor of the private sector, due to what has already been proven to be the undue influence of large campaign contributions by the real estate industry from city to state elections.
For example, the secretive 2014 sale of the Section 8 NYCHA buildings sidestepped a requirement in the City Charter that the disposition of city real property must be subjected to the Uniform Land Use Review Procedure, or ULURP, a possible violation of law that disenfranchised the public from having any input on the sale. The only reason the de Blasio administration would make an offering for sale of the Section 8 buildings to real estate investors or developers would be to avoid public scrutiny of the transaction, a similar stealth tactic that some activists they say they experience with their Community Boards in respect of the consideration of the mayor's massive rezoning plan.
To have stopped the privatization of NYCHA, voters, taxpayers, NYCHA tenants, or surrogate advocates would have needed to have mounted a legal challenge. For that, the challengers would have needed public-interest lawyers, expert witnesses in economics and land use, community groups willing to stand up to the de Blasio administration in court, and activists that were independent of the political machine that is City Hall.
It’s not known if the de Blasio administration will subject or is required to subject the NYCHA land-lease deal to the ULURP process, as any disposition of city real property would be required by Section 197-c of the City Charter. As mentioned before, the City Hall press offices refuses to make de Blasio administration officials available for interviews conducted by Progress Queens. A separate request made by Progress Queens to Alicia Glen’s chief of staff, asking for an interview with the deputy mayor, was never answered.
Furthermore, the City Charter is supposed to allow communities to work with their Community Boards to develop community-created plans for development. Even when these community-driven planning proposals, known as 197-a plans, are created with Community Boards, the 197-a plans are not acted upon. “There are probably no boards that would say that their 197-a plans have been adopted or implemented,” Eve Baron, the academic program manager for Urban Studies at the Joseph S. Murphy Institute at the CUNY School of Professional Studies, told the journalist David Giambusso for a report published by Capital New York, a reflection that perhaps City Hall doesn’t support determinations made by communities for what serves their own best interests in terms of land use. Since ultimate approval of 197-a plans actually rests with the City Council, most 197-a plans don’t get much support there, since the real estate industry is able to exert political influence over elected officials, Mr. Angotti, the Hunter College professor of urban affairs and planning, told the journalist Gerard Flynn for a report in City Limits. Acting to further eliminate community participation in matters of their own land use determination, the city land use procedure has de-emphasized 197-a plans. "Not many people do them anymore because the City Planning Commission doesn’t really recognize them and dismisses them as advisory," Mr. Angotti added.
According to the Capital New York report about 197-a plans, the de Blasio administration was not even reaching out to all Community Boards for feedback to the administration document about Mayor de Blasio’s planning vision for New York City. By not engaging with Community Boards, the de Blasio administration was undermining what little involvement the public are afforded in matters of land use. The administration document, known as OneNYC, is an update to Mayor Bloomberg’s PlaNYC.
The de Blasio administration has also triggered criticism over its arrangement to circumvent the public oversight process of land use for one of the 15 neighborhoods he wants to upzone. In the Willets Point neighborhood of Queens, the administration entered into an agreement with a nonprofit group managed by former Queens Borough President Claire Schulman to spearhead the rezoning of that neighborhood. According to a report published by Crain’s New York Business, the administration signed over authority to the nonprofit, Flushing Willets Point Corona Local Development Corporation, to “to sign off on a portion of the planning department's work,” effectively outsourcing the public’s business to a politically-connected nonprofit group. Local development corporations, such as the Schulman nonprofit, cannot lobby or otherwise influence rezoning. A prior attempt by the Schulman nonprofit to influence zoning triggered a probe and a determination by the state’s Attorney General’s Office that the local development corporation had broken the law, according to a 2012 report published by The New York Times. Yet, the de Blasio administration was engaging in the similar outsourcing of planning work that triggered such a violation under the Bloomberg administration, raising the obvious question : Why is the public’s business being subverted ? Since the administration will not provide housing or development officials to be interviewed by Progress Queens, the administration’s explanation is not known.
The steady drumbeat to privatize NYCHA may be backfiring
To keep himself insulated from charges that he has been waging a neoliberal economic agenda, Mayor de Blasio has deftly employed proxies. In Mayor de Blasio’s stead, NYCHA CEO Shola Olatoye has been leading the public campaign to sell Section 8 buildings and green spaces in order to fund maintenance of the city’s housing authority’s portfolio of aging public housing developments. At a February 10 City Council hearing, CEO Olatoye testified about the controversial sale of several Section 8 apartment buildings, saying, in part, that the sale “was the only solution to the underfunding issues experienced at our poject-based Section 8 developers for decades.” NYCHA officials had publicly announced the sale only after the transaction had closed, infurating the public.
In further testimony, NYCHA CEO Olatoye said, in part, that “We don’t know what the future holds. But I think it would be irresponsible for us to not take advantage of tools that, frankly this city has utilized and pioneered to create thousands of affordable housing units,” according to a report written by the journalist Will Bredderman and published by The New York Observer, putting the public on notice that further real estate transactions could possibly be considered.
At a March 26 City Council hearing, CEO Olatoye said, in part, “we must … rehabilitate and harness NYCHA’s real estate assets,” worrying activists and NYCHA tenants that CEO Olatoye was determined to take a hatchet to NYCHA.
Indeed, tenants have become frustrated by the lack of focus on improving the immediate living conditions of NYCHA public housing developments. Tenants have every right to feel a sense of dissatisfaction, because the privatization plan isn’t meant to address the situation of current NYCHA tenants. It’s meant to open the door to real estate developers to exploit city real property for potential construction projects for profit so that Mayor de Blasio can construct an incremental amount of new affordable housing units, as was indicated in a study conducted by a real estate-linked think tank at New York University known as the Furman Center for Real Estate and Urban Policy.
The Furman Center study revealed developers' intent on "leasing NYCHA land for the development of new housing" with estimated financial calculations made across three different land-lease payment models. The first, where NYCHA would seek to maximize land-lease payments from developers with an 80%-20% split of units, where 80 per cent. of the apartments would be rented at free market rates and only 20 per cent. would be reserved for affordable housing, the latter being available to tenants earning 60 per cent. of AMI ; the second, where NYCHA would forgo any land-lease payments from developers in favor of maximizing the construction of affordable housing with corresponding ranges from 45%-55% to 0%-100% splits, depending on the amount of rents that developers could collect, with models forecast at a range of 30 to 170 per cent. of AMI ; and a third, where NYCHA would blend the goal of generating some land lease payments from developers against the de Blasio administration's goals of building more affordable housing units. Under the third option, the study models 70%-30% and 50%-30%-20% splits, where the latter would reserve affordable housing units for tenants earning either 130 or 50 per cent. of AMI.*
Across these three bands of ranges in affordable housing, the Furman Center study then examined estimated amounts that NYCHA would be receiving in lease payments from developers if NYCHA selected high-rent, medium-rent, and low-rent neighborhoods for the new construction. Not surprisingly, the Furman Center indicated that NYCHA would receive the greatest estimated lease payments from developers for apartments constructed in high-rent neighborhoods. Indeed, the study predictably concluded that the construction of apartment buildings under the third option, at a 70%-30% split, would not be financially feasible in low-income neighborhoods, essentially revealing that the primary motivator for the most successful land-leases would have to be construction of new apartments in neighborhoods that would maximize both lease payments and rents. The Furman Center study left no doubt that what would motivate real estate developers to invest in NYCHA properties was the expectation to earn profits. Moreover, as had been feared by activists, the affordable housing that would be reserved at the highest percentage of AMI would fail to benefit residents most in need of affordable housing, since no- to low-income residents would not qualify to be tenants in the new construction, given the Furman Center study's financial models. Finally, building affordable housing in high-rent neighborhoods at a high AMI would guarantee higher rents, since the real dollar values of such conditions would lead to the potentiality of the highest rents.*
NYCHA CEO Olatoye has become the face of the move to privatize NYCHA, so much so that she’s earned the ire of angry NYCHA tenants. Unsatisfied with the pace of reforms at NYCHA, community leaders and tenants have called on CEO Olatoye to resign, insulating, for now, Mayor de Blasio from the community’s growing discontent.
The “managed” role of nonprofit groups in the de Blasio era
The possibility of political blowback is why Mayor de Blasio strongly relies upon a carefully managed relationship with nonprofit groups, which nominally aim to serve the city’s tenants. In an allusion to the writings of Mr. Engels in Part 2 of The Housing Question, nonprofit groups are competing against each other “in noble efforts” to address housing issues. This philanthropic effort fails, though, because the nonprofit groups are prevented from making aggressive political demands of the government, in this case, the de Blasio administration. Failure is also guaranteed, because these demands would run counter to what the real estate industry would be willing to accept. Instead, the nonprofit groups are managed to adopt the de Blasio administration’s policies. This occurs in accordance with the veal pen dynamic, as described by Jane Hamsher, publisher of Firedoglake. As shown in a prior report published by Progress Queens, the key nonprofit tenant advocacy groups abandoned a stricter demand on ending the controversial 421-a tax abatement program after Mayor de Blasio announced his support for a modified tax break proposal that would incrementally add to his affordable housing goals. Such a lack of discipline is what Blair Horner, the legislative director for the New York Public Interest Research Group, or NYPIRG, had predicted would lead to a less than optimal outcome for tenants during the negotiation of rent laws in Albany. Notwithstanding Mr. Horner’s warnings, Mayor de Blasio was able to capitalize on a fractured tenant lobby in order to secure a modified 421-a tax abatement program that could, depending on final negotiations, help incrementally add to his tally of new affordable housing units, no matter how minimal those gains may turn out to be.
“You don’t have community groups willing to stick their necks out and tell their [elected officials] to do the right thing, or else, ‘We’ll vote you out,’” said Mr. Fisher, the founder of the tenant resource Web site, TenantNet. With no mechanism to hold elected officials accountable, the formation of government policy is less than what the voters deserve.
Coupled with the less than aggressive work of the nonprofits, now comes the real estate industry, trying to cloak their participation in NYCHA developments and the other affordable housing projects as a civic-minded public-private partnership. The Mayor’s Fund to Advance New York City extends this credence by accepting charitable donations that are ear-marked, in part, for housing programs. Again borrowing from Mr. Engels’ writing in Part 2 of The Housing Question, “these philanthropic efforts are in fact so miserably futile.” There is no charity, since the land-lease plans were announced by the administration weeks after Progress Queens reported that the Furman Center released a study evaluating the profitability of constructing affordable housing on open spaces owned by NYCHA. The Furman Center explored in its report the possibility that NYCHA would lease lands of its open spaces for the construction of market-rate and affordable housing. Therefore, real estate developers aren’t being motivated by charity ; intead, they are being motivated by the profits to be derived from the construction of apartment buildings on land leased from NYCHA, contrary to the veneer of the charitable public relations spin.
Real estate developers don’t exist to end the affordable housing crisis in New York City. They exist to make the most amount of money from the construction and sale of lucrative development projects, usually luxury condominiums or luxury rental apartment buildings. The only reason that some real estate developers have attached themselves to Mayor de Blasio’s 200,000-unit affordable housing plan is because the plan creates opportunities for real estate developers to profit from Mayor de Blasio’s plans, as the Furman Center study showed. All of this is being done with no express voter mandate on land use and with no demand for accountability by nonprofit groups.
In her interview with Progress Queens, Ms. Boyd said that she observed this failed nonprofit dynamic in her Brooklyn community. When she said that she first began to confront the upzoning of Empire Boulevard in Prospect-Lefferts Gardens, “There was nobody organizing the communities,” Ms. Boyd said, adding that, “The group that was supposed to be organizing the community wasn’t doing enough,” triggering questions from the community, Ms. Boyd said, such as, “’Why aren’t we demonstrating ?’”
Questioning the role of nonprofits that may have deliberately deëscalated calls for a stop to the rezoning, Ms. Boyd said that decision-makers knew to expect that the community would rise up in protest, because, “We believe in democracy. We believe that this is a democratic society, and as long as that belief exists in our minds, we want to be organized.”
Since Ms. Boyd said that decision-makers knew this in advance, the cynical solution was for decision-makers to manipulate the nonprofit groups. “They are funneling money to the nonprofits from the politicians, from developers,” and from others, Ms. Boyd said, adding that such funds provide for the hiring of leaders, whom Ms. Boyd pointed out are not grassroots organizers, creating a situation where decision-makers are empowered to direct nonprofit leaders, “but direct them in a way in which their organizing is very minimal, as far as effectiveness.”
Sometimes, Ms. Boyd said, nonprofit leaders will target individuals, like an individual landlord. Other times, nonprofit leaders will focus on providing assistance to the members of their own group. “But outside of that, that’s it. And they don’t focus on the issues, or they focus on the symptoms and not the disease.” Since nonprofit groups are beholden to their funders, they are at risk of being told to “back off” from issues that are sensitive to their funders, Ms. Boyd said.
Ms. Boyd described how politicians give nonprofit groups more importance than grassroots activists, because elected officials push the nonprofit groups in front of the media, with the elected officials standing behind them, which allows elected officials to benefit from these photo ops, and this results in nonprofit groups receiving more publicity, increasing the name awareness of both the nonprofits and the nonprofit leaders. Ms. Boyd said that with the increased name awareness, some nonprofit leaders are able to get jobs within the political machinery. Ms. Boyd said that some nonprofit employees make $30,000 a year, but, if they played their cards right, they could end up with jobs that potentially pay salaries of $120,000 with the de Blasio administration.
These and other potential conflicts of interest converge into creating circumstances where nonprofit groups defer to elected leaders, instead of pressuring elected leaders with more aggressive demands on behalf of the communities that they claim to represent, leaving communities with a diminished voice on matters of land use.
A request made by Progress Queens to interview an official with Make The Road New York, a nonprofit group active in some tenant advocacy coalitions, was not answered. Make the Road New York was amongst the nonprofit groups, which had participated in demonstrations calling for an end to the controversial 421-a tax abatement program, but suddenly stopped, after Mayor de Blasio had expressed his support for a modified tax abatement program.
"May the odds be ever in your favor" : The de Blasio real estate doctrine will not solve the affordable housing crisis
Mayor de Blasio’s plan to preserve 120,000 affordable housing units and to create 80,000 new affordable housing units will not solve the shortage in affordable housing in New York City, even as he rushes to privatize open spaces owned by NYCHA and embraces the trickle-down economics of the 421-a tax abatement program. His plan is already inadequate.
According to statistics compiled by the journalist Mireya Navarro and published by the The New York Times, for example, Mayor de Blasio's affordable housing plan has been confirmed to fall short of meeting actual needs. Referring to 2014, Ms. Navarro wrote, "Last year, tenants won 2,500 new apartments through 41 lotteries that drew a total of 1.5 million applications, housing officials said. The lotteries are expected to multiply under Mayor Bill de Blasio’s pledge to produce 80,000 moderately priced apartments over the next 10 years, a goal that, even if reached, would still leave many lottery hopefuls empty-handed."
And Mayor de Blasio’s affordable housing plan represents a failure to fully address the affordable housing crisis in New York City. By continuing to embrace policies that are deemed acceptable to real estate developers, Mayor de Blasio is never going to get to the root cause of what is causing the shortage of affordable housing in New York City, namely, the very pressures that create primary and secondary displacement, ongoing real estate speculation, and the construction of more and more luxury condominiums that lead to a relentless upward pressure on real estate prices, and, thus, to the cost of rents.
As pointed out by some activists, the mayor’s favorite 421-a tax abatement program is one of the primary causes of the erosion in the number of affordable apartments in New York City, leaving many to question why the de Blasio administration fails to address the causes of the affordable housing shortage instead of just proposing an inadequate 200,000-unit preservation/construction remedy. Some activists explained this serious failure by pointing to Mayor de Blasio’s close working relationship with real estate developers and other big business leaders. Knowing how politics is played and facing a reëlection in 2017 with the possibility of a primary challenger, Mayor de Blasio doesn’t want to upset his core business supporters, sources he will need for campaign fundraising.
As demonstrated with the example of affordable housing at Atlantic Yards, what is affordable is subjective. Notwithstanding, the de Blasio administration recently trumpeted the creation or preservation of 20,000 affordable housing units for Fiscal Year 2015. This announcement contrasts with conflicting information about how many affordable housing apartment units have been lost in the recent past. Estimates range from the loss of over 50,000 units of rent-regulated affordable housing over the last eight years, according to a study by John Krauss and published in Gothamist, to the loss of 300,000 in affordable housing units in recent years, according to a 2013 estimate by former Council Speaker Quinn. The Gothamist report noted that the analysis of the loss of rent-regulated apartments was made difficult by a challenging process to access housing agency data. In a blog post, Mr. Krauss said that it was arduous to overcome housing agency obstacles to obtain the data, due to denial of a request filed under the state’s Freedom of Information Law, or FOIL. According to information obtained by Progress Queens, most housing agencies or regulators either do not adequately track housing data, or else they make it difficult to obtain data, as recently experienced when the New York State Attorney General’s Office denied a FOIL request filed by Progress Queens.
Conflicts of interest and the ignored problem of corruption
As previously reported by Progress Queens, the Furman Center study was produced with assistance, in part, from the Moelis Institute for Affordable Housing Policy, which is funded by Ronald Moelis, a real estate developer and a member of REBNY, the politically influential real estate lobbying group. Mr. Moelis is also a member of the Board of Advisors for the Furman Center, as are the developers Larry Silverstein and Stephen Ross, amongst others. Mr. Moelis is also a co-founder and principal of L+M Development Partners, one of the firms that bought into the consortium that purchased the Section 8 buildings from NYCHA in December 2014.
Gary Rodney, a former executive of another real estate company, BFC Partners, which is a member of the consortium, which bought into the Section 8 buildings, is now President of the New York City Housing Development Corporation, a city agency, which helps to finance the construction of affordable housing. One of the lobbyists, who was employed by BFC Partners, was Jonathan Greenspun. Mr. Greenspun was appointed by Mayor de Blasio to serve on the city’s Commission on Human Rights, giving Mr. Greenspun oversight on complaints about discrimination, including housing discrimination, a potential conflict of interest.
Other conflicts of interest exist, as shown by Mayor de Blasio’s reliance on finance and real estate firms for contributions to the Mayor’s Fund to Advance New York City, the nonprofit headed by his wife, Chirlane McCray.
Despite Mayor de Blasio’s protestations that Governor Cuomo is close to the hedge fund industry, a hedge fund titan is a large contributor to the the Mayor's Fund to Advance New York City. Paul Turor Jones, founder of Tudor Investment Corporation, is also the founder and a director of the Robin Hood Foundation. The foundation was a contributor of over $1 million to the Mayor’s Fund to Advance New York City, according to a recent filing with the city’s Conflicts of Interest Board. The exact size of the contribution was not disclosed.**
Notwithstanding Mr. Tudor Jones’ contribution to the mayor’s official nonprofit group, Mr. Tudor Jones has publicly dissed Mayor de Blasio’s handling of public education, revealing more of the never-ending duplicity in politics, particularly by big money donors.**
Other influential donors to the Mayor’s Fund to Advance New York City were :
- The Association for a Better New York Foundation, a philanthropic group controlled by William Rudin, an official of Rudin Management Company, the developer of the $1 billion luxury condominium and townhouse complex being built on the site of the former St. Vincent’s Hospital ;
- Capalino + Company, the firm of the real estate lobbyist James Capalino, an early big business supporter of Mayor de Blasio’s 2013 campaign ;
- L+M Development Partners, one of the real estate firms, which invested in the consortium that purchase the portfolio of project-based Section 8 buildings from NYCHA ;
- The Rudin Foundation, Inc., another philanthropic group connected to Mr. Rudin of Rudin Management Company ;
- Silverstein Properties, the development firm controlled by Larry Silverstein, owner of the leases on the World Trade Center ; and
- Tishman Speyer Properties, the influential real estate developer formerly closely tied to former City Council Speaker Quinn, but now closely realigned with Mayor de Blasio.
Some heads of real estate firms also serve in advisory capacities to the Mayor’s Fund to Advance New York City, including : Bruce Ratner, the developer of the Atlantic Yards project in Brooklyn ; Mr. Rudin, an executive and a beneficial owner of Rudin Management Company ; Rob Speyer, an executive of Tishman Speyer ; and Daniel Tishman, an executive of Tischman Construction.
Still yet other conflicts of interest exist with the real estate industry, as shown by Mayor de Blasio’s reliance on finance and real estate firms for contributions to his nonprofit lobbying arm, the Campaign for One New York. The donors, which have contributed to the Campaign for One New York, include :
- Alma Realty, the developer of the Astoria Cove project in Queens ;
- Capalino + Company, the firm of the real estate lobbyist, Mr. Capalino ;
- The Fund for Policy Reform, Inc., a philanthropic group controlled by the hedge fund manager George Soros ;
- Ral Development, the firm behind the construction of two towers at Brooklyn Bridge Park ; and
- Toll Brothers, the home builder.
Besides the conflicts of interest with real estate, Mayor de Blasio is ignoring the criminal investigations that have raised questions about the 421-a tax abatement program.
One of the real estate development firms, which had been subpoenaed by the now-defunct Moreland Commision, was Extell Development Company, the developer of the $2 billion luxury condominium tower in Midtown Manhattan known as One57. The skyscraper is so tall that it casts long shadows over Central Park, even though the tower is situated on West 57th Street.
Extell, related entities, or associated invidividuals, were responsible for making approximately $300,000 in contributions to campaign committees controlled by Governor Cuomo during the time when the state government was lobbied to sign into law a bill that granted 421-a tax abatement qualification for the One57 project. That tax transaction is reportedly being probed by the office of U.S. Attorney Preet Bharara, the nation’s top federal prosecutor in New York’s southern district, according to a report published by The New York Post.
In corruption cases against Assemblymember Sheldon Silver (D-Lower East Side) and State Senator Dean Skelos (R-Rockville Centre), another prominent developer, Glenwood Management, has figured in the backdrop of actors seeking favorable legislative treatment, including 421-a designation for their buildings.
Leonard Litwin, the owner of Glenwood Management, has been shown to be one of the state’s largest campaign contributors, according to a report published by Crain’s New York Business. Mr. Litwin has made large campaign contributions by exploiting an interpretation of the law that allows limited liability companies to make separate campaign donations even though they may roll up to one ultimate beneficial owner. The exception that allows contributions to be made through related limited liability companies is referred to as the LLC loophole, and Mr. Litwin’s giving was documented in a report published by ProPublica.
Government reform activists look at the 421-a tax abatement program, and they see that some large real estate developers are able to afford to make hundreds of thousands of dollars in campaign contributions, given that the 421-a tax abatement program can generate tens of millions of dollars in property tax savings, perhaps inducing some politicians to seek to monetize their public office in the process, a concern that Mayor de Blasio ignores in his reliance on the program to help him achieve incremental gains in his affordable housing plan.
What can activists do about the lack of democracy in land use ?
Although more and more tenants and activists are recognizing Mayor de Blasio’s pro-real estate agenda, what is missing is tenant and activist consensus about what to do about this. Some activists have been fighting the sale of public library branches to real estate developers, thinking that each sale is a singular transaction, independent onto itself, and not part of a larger, pro-real estate agenda by the de Blasio administration. Activists think that if they can just defeat the sale of one library, then the larger cause can be won. Efforts by developers and city planning officials to subject small fights to the arduous ULURP process, while sidestepping larger projects, has the impact of narrowing activists’ focus at the same time that they can be worn down.
Grassroots activists in disparate communities are fighting individual, zone-busting real estate developments on a one-on-one basis that perhaps cannot be won, because the larger battle was already lost when some anti-Quinn activists joined with some de Blasio supporters and agreed to give the de Blasio a pass when it came to his real estate plans, like what happened with the failed attempt to form a Brooklyn hospital authority.
All this raises even more questions, like whether the de Blasio administration is proceeding with the privatized redistribution of public assets. The only way public assets can be redistributed to wealthy campaign contributors would be if the de Blasio administration were either willing to risk or outright flagrantly violate the principles of democratic control over land use, a dynamic generally described by David Harvey in his essay, “The Right to the City,” which was published in the New Left Review. Although Mr. Harvey was not precisely writing about New York City and the de Blasio administration, this dynamic could be written about any city and any mayor where the nexus of a booming real estate market and the motivation to profit from it existed.
Paraphrasing Mr. Harvey and applying his essay to the situation created by the de Blasio administration, Mayor de Blasio’s policies regarding the treatment of city real property are undermining democratic control of land use.
This can already been seen in media reports, such as the compelling investigation broadcast by the journalist Grace Rauh at NY1 News. Ms. Rauh's report probed the close ties between the real estate lobbyist Jonathan Rosen and Mayor de Blasio. Mayor de Blasio’s first major land use issue was the redevelopment of the old Domino Sugar Factory in Brooklyn. The developer was represented by Mr. Rosen’s firm at the same time when Mr. Rosen’s firm was advising City Hall, a blatant conflict of interest, but one that revealed Mayor de Blasio’s attitude about how he protects his relationships with close advisors and political supporters, even if it were to possibly mean allowing lobbyists with real estate ties to simultaneously play both sides of the fence, the outcome being that the administration was welcoming the influence of lobbyist but not voters on matters of land use.
As activists look to hold the administration accountable to activists’ expectations for a course for a post-Occupy Wall Street city that was not aligned with big business, there are many issues to consider. Firstly, how do activists plan to educate each other on a complete and accurate picture of how much of the political landscape in the de Blasio administration has been influenced by the real estate industry ? Secondly, will activists reject Mayor de Blasio’s incremental and inadequate remedy to the affordable housing crisis, and, if so, what can the community demand in its place ? And thirdly, what should be done about the veal pen nonprofit groups, which willingly deëscalate calls for political, social, and economic reform, based on the messaging emanating from City Hall ? Other issues undoubtedly also exist, but organizing cannot take shape about where we want to go as a city until everybody first agrees on what is actually happening now.
A neoconservative tug on neoliberal leanings
As it stands, the influences of the real estate industry are causing neoliberal leanings in the de Blasio administration to cross-over into instances of neoconservativism, such as Mayor de Blasio’s irreconcilable defense of the race-based Broken Windows approach to policing. Even though he had campaigned for the city’s mayoralty with the promise to end the race-based stop-and-frisk era, Mayor de Blasio has defended the police crackdown on very low-level offenses that primarily target low-income communities and communities of color. All Mayor de Blasio did was substitute race-based Broken Windows for race-based stop-and-frisk, some say. Some police reform groups have highlighted the influence of real estate on race-based policing as a way to target neighborhoods for gentrification, but the police reform groups that ring this alarum bell do so in a vacuum, where key nonprofit groups have been subjugated and are unwilling to openly and directly challenge the mayor.
“They really want a wealthier city,” said Ms. Boyd, the Brooklyn housing activist, adding that city leaders are aiming to transform New York City to resemble Dubai, the large Middle East city notorious for its income and wealth disparities. Ms. Boyd pointed out that Dubai has experienced financial problems in recent years in spite of the city’s riches, adding that, “For all its wealth, it’s not an economically stable city. And neither will we be, when you eliminate the working class and the poor.”
Ms. Boyd predicted that the city’s current lack of informed planning, which she said has been based on greed and money, will not be sustainable, citing the example of Dubai’s financial troubles. “What we have is a city that is being run by the real estate industry,” Ms. Boyd said, adding that, “Their only objective, at this point, is to make money.”
Bright signs of some progress, and the need for a political fight
There are some bright spots, though. In Brooklyn, Ms. Boyd and other members of the Movement to Protect the People are exposing the corrupt Community Board system that rubber stamps zone-busting developments on suspected orders from Borough Hall and City Hall. In Manhattan, the city’s Conflicts of Interest Board has determined that there were violations at one Community Board that has seen a spate of rapid development and gentrification, leading to questions about whether the land use activities of that Community Board should be being probed by prosecutors, as well. In Queens, years of questions about the way one Community Board approved zone-busting developments has finally triggered a reported federal corruption probe by the U.S. Attorney’s Office for New York’s eastern district. Also in Queens, local groups were able to fight and defeat in court a proposed project to build a shopping mall inside of Flushing Meadows Corona Park. This is the second major win for defenders of Flushing Meadows Corona Park. In 2013, the community defeated talk by the out-going Bloomberg-Quinn administration to build a commercial soccer stadium in the park. But these are temporary wins, either subject to appeal or leaving no binding land use rules that would apply to similar circumstances in the future.
Augmenting these signs of success and sources of possible reform is the larger call for activists to return to the fold of political proactivity as opposed to reactivity. In the case of the plans to privatize NYCHA, Ms. Boyd said that NYCHA tenants and activists must take a stand against the plans by the de Blasio administration.
“That’s really where the fight is, it’s on the political front,” said Ms. Boyd, adding of NYCHA tenants, “I mean, they can organize. They can get together, they can do mass marches, they can do protests. They can go into these meetings when they are coming to the community and talking about, you know, ‘We’ve got a really good deal for you.’ They can do that, and that’s what they need to do.”
Some opposition by NYCHA residents has already percolated up from their sense of frustration with NYCHA management, but that frustration is centered around reported managerial manipulation of repair backlog statistics and other issues of mismanagement, not on the growing drumbeat for privatization. Even though some NYCHA tenants and civic groups have called on NYCHA CEO Olatoye to resign, activists believe that the de Blasio administration plans to cynically ignore the discontent until it dissipates.
Ms. Boyd worries that as the de Blasio administration creeps from selling Section 8 buildings to leasing green spaces “right at the heart of NYCHA,” taking these steady but “little, tiny baby steps” toward privatization, there will need to be greater resistance during the current housing crisis to prevent developers having their way when it comes to city real property and property tax breaks. “I don’t believe that there’s nothing we can’t do, but I believe that they have to get really organized,” Ms. Boyd said, referring to NYCHA tenants.
To Ms. Boyd, who has been on a journey to challenge Brooklyn Community Board 9 in her fight against gentrification in her neighborhood, she sees a larger fight about New Yorkers claiming their democratic right to participate in determining land use in New York City.
Speaking generally of Community Boards, Ms. Boyd said she believed that there was no democratic control of land use. Even though Community Boards are the first entry point for residents to engage the decision-making process on zone-busting development applications, Ms. Boyd noted that Community Board members are chiefly influenced by borough presidents, who largely make the politically-driven appointments. If community residents disagree with rulings by Community Boards, their only legal recourse is to file Article 78 lawsuits before the New York State Supreme Court, seeking judicial review of Community Board actions. However, Ms. Boyd noted, that community residents would be substituting appearing before a politically-driven Community Board in exchange for appearing before a politically-driven Supreme Court, since Supreme Court justices are selected in a politically-driven process that involves the district leaders of political party county committees.
Ms. Boyd said she was incredulous to believe that “you have a political system that creates a political body,” referring to a Community Board, adding that, “and then your recourse, when that political body might be engaging in unlawful behavior, is to go to another political body ?”
“You see where you’re going, right ? That’s why so many Community Boards all over New York City don’t respond to their residents. People come in mass to Community Boards, saying, ‘No, I don’t want something.’ If it’s about land use, they don’t get it. It happened downtown in Community Board 2,” Ms. Boyd said, referring to community residents’ unsuccessful fight to stop the sale of a public library in downtown Brooklyn.
Ms. Boyd said she found fault with the fact that Community Boards do not defeat controversial land use applications largely opposed by residents, because Community Board members apparently do not serve to represent the community. Instead, Community Board members serve at the pleasure and to express loyalty to the respective borough presidents, who are largely responsible for making the appointments. Ms. Boyd further noted how at some Community Board meetings, community residents are disempowered to speak, a violation of the democratic principle of citizen participation.
As has been noted by others, Ms. Boyd said that she remains optimistic that, in the long-term, corruption will lead to changes in government, as it has elsewhere around the world. In the meantime, some people may suffer as a result of corruption and gentrification, but the conditions that enable corruption will not last, Ms. Boyd said. Time was, people lost their lives for educating or organizing the public against corruption. Now, however, Ms. Boyd said that the consequences of community education or organizing are not as severe, opening the door to allowing communities to keep pushing for changes.
The fight to stop gentrification in Ms. Boyd’s neighborhood in Brooklyn resembled the fight to stop the sale of the Brooklyn Heights public library branch, which in turn, resembled the fight to stop the rezoning of the former campus of St. Vincent’s Hospital in the West Village, the latter a fight that was lost from the outset before Manhattan Community Board 2. In Ms. Boyd’s neighborhood, residents appealed to Public Advocate Letitia James (D-New York City) for support, but her office ended attempts to work with the community once it became clear that the community was opposing a land use matter. Similarly, downtown Brooklyn residents reportedly reached out to Mayor de Blasio’s office for support to save the Brooklyn Heights branch of the Brooklyn Public Library, but he, too, ignored entreaties to get involved, since the matter involved land use. Efforts to reach Public Advocate James for an interview for this article were unsuccessful.
Regarding St. Vincent’s, community residents sought the intervention of Assemblymember Deborah Glick (D-West Village), but she, too, ended her direct involvement with community activists after it became apparent that the fight was going to be solely based on land use. According to information obtained by Progress Queens, in the case of Assemblymember Glick, West Village community activists believed that, once the hospital was closed, she herself had declared that for political reasons she would not directly oppose any major real estate developer. In the case of St. Vincent’s, the developer in question was Rudin Management Company, an influential campaign contributor and member of the conservative chamber of commerce-like group, the Partnership for New York City.
In an interview with Progress Queens, Assemblymember Glick denied that she walked away from the community, pointing out that through her efforts the New York State Assembly provided St. Vincent’s with $1 million in order to help the hospital make its payroll. However, at the one year anniversary rally of the closing of St. Vincent’s, activists noted that not one elected official appeared before the hundreds in the community, who had showed up to continue to demand a replacement hospital. One community resident, Sandra Truman, was expected to speak at that rally, but, on her way to the rally, she was struck by a car blocks away from the former site of St. Vincent’s, and Ms. Truman had to be rushed to a hospital by an ambulance. Portions of her written speech were read at the rally by former St. Vincent’s nurse, Eileen Dunn.
Ms. Truman had written about some of the regrets she had in the fight to save the hospital, amongst them being “changing my voter registration to better support my local politicians,” Nurse Dunn read of Ms. Truman’s written speech, adding of the local politicians that, “They did not support us in saving St. Vincent’s, choosing instead to support their real estate contributions,” at which point loud cheers erupted at the rally, noting the real talk in Ms. Truman’s remarks.
Assemblymember Glick asserted that once St. Vincent’s closed, in order for the community to secure a replacement hospital, two things were needed : (i) a certificate of need from the state’s Department of Health, and (ii) the identification and willingness of a hospital operator to buy St. Vincent's and resume the functions of a hospital on the site, both of which did not materialize, she told Progress Queens.
Notwithstanding Assemblymember Glick’s protestations that real estate had nothing to do with the demise of St. Vincent’s, community activists pointed to the nearly $30,000 in campaign contributions that former Council Speaker Quinn received from the beneficial owners of Rudin Management Company leading up to the City Council’s decision on Rudin’s land use application to convert the site of the former hospital into a $1 billion luxury condominium and townhouse complex. Making land use less democratic for New York City communities during the Bloomberg administration was former Speaker Quinn’s autocratic style of strong-arming the City Council into approving legislation and land use applications in accordance with her own wishes. For example, former Council Speaker Quinn never recused herself from the City Council’s land use decision-making process in respect of St. Vincent’s, an issue that was later successfully turned against her, along with other controversies, in the 2013 mayoral campaign, the outcome of which ended her 15 year career in elected office.
Lack of transparency and use of gag orders on real estate projects
Before the end of the Bloomberg administration, large land use projects were proceeding across New York City, including the sale of two city-owned buildings in the Civic Center of Downtown Manhattan and the huge, 1.65-million-square-foot development at Seward Park in the Lower East Side of Manhattan. According to revelations made public by the office of Assemblymember Glick late in 2012, the New York City Economic Development Corporation, then headed by Seth Pinsky, had been seeking that public officials and their staff sign confidentiality agreements if they wanted to participate in the meetings of the respective task forces set up for the Civic Center and Seward Park projects. In a newsletter to her constituents, Assemblymember Glick called the move “anti-democratic,” and she and her staff refused to sign the confidentiality agreements, a move which forced the city’s Economic Development Corporation officials to ask her staff to leave the meetings. “Because I believe in open government and transparency, I along with my staff refused to sign this agreement, and my office was asked to leave a Civic Center Taskforce Meeting we were participating in and denied the ability to participate in any future meetings,” Assemblymember Glick wrote in a newsletter, announcing the revelations. Whereas Assemblymember Glick’s office objected to signing the confidentiality agreements, which she compared in her newsletter to gag orders, there were obviously elected officials or their staff, who did, cloaking those projects from the transparency needed for public awareness, and resulting public participation, in matters of land use.
In an interview with Progress Queens, Assemblymember Glick said she supports greater transparency in government, including in matters of land use, saying, “The more information that’s available, the better.” In matters of politics, Assemblymember Glick was frank about the power of real estate industry, “The thing about New York, real estate has had an out-sized influence. Either developers or landlords, they’ve had tremendous influence.” A request for an interview with the city’s Economic Development Corporation, now headed by Maria Torres-Springer, an appointee of the de Blasio administration, was not answered, further concealing the important development agency from public scrutiny.
During the Bloomberg administration, Ms. Torres-Springer served at the city’s Economic Development Corporation under former President Pinsky during several large-scale land use projects, including the approval of the Cornell-Technion campus on Roosevelt Island, a development that Roosevelt Island residents have found divisive and that has triggered several controversies.
Relying on an undemocratic land use approval process for further zone-busting development
To government reform and community activists, like Ms. Boyd and others, that the de Blasio administration would be relying on Community Boards to advance his massive rezoning initiative points to a political and legal failure by City Hall. Activists believe that the Community Board system is broken, prone to corruption, and is irrevocably compromised by conflicts of interest.
Ms. Boyd said that Mayor de Blasio needed Community Board approval for his plans, nonetheless, because any circumventing “would be a mess.” Ms. Boyd speculated that Mayor de Blasio has been trying to avoid open opposition during the approval process for his massive rezoning, an approach which may explain why a zoning letter pertaining to Ms. Boyd’s neighborhood of Prospect Lefferts Gardens was being quietly considered by Brooklyn Community Board 9, at first, before Ms. Boyd and the community group she leads, the Movement to Protect the People, became involved in voicing opposition.
In her work to oppose the rezoning of her Brooklyn neighborhood, Ms. Boyd, has managed to pull back the curtain, so to speak, on the Community Board system that fails communities. As noted by Ms. Boyd and others, who have endured protracted battles with Community Boards over land use matters, the ultimate recommendations issued by Community Boards only carry advisory weight in the city planning process. Community Board recommendations are not considered legally binding, except that they may be required by law. Notwithstanding, it is at the Community Board level, no matter how compromised by conflicts of interest or mixed loyalties, where community residents first engage important land use issues, revealing a contradiction for community residents, who are essentially forced to spin their wheels in a process where the outcome is only an advisory recommendation, irony that was not lost on Ms. Boyd, especially as it relates to Mayor de Blasio’s massive rezoning plan.
“That’s the problem, right ? You tell the community, ‘You have power. You can decide your land use.’ You then put people in there, [to serve on Community Boards,] who are working for the politicians and developers,” Ms. Boyd said, referring to the Community Board members, adding that when the community shows up to have their voices be heard, community residents question why their voices are not, in fact, heard. The political system misleads the community into believing that they are being heard, Ms. Boyd said, leading to experiences that many have described as filled with confusion, frustration, and obfuscation.
Ms. Boyd noted that elected officials sometimes use the advisory capacity of Community Board recommendations against community residents’ demands to have a greater say, leading Ms. Boyd to conclude about Community Boards, “It’s a lie, anyway, but we know politically that the political machine needs that lie,” repeating that, “They need the lie. They need the lie, so that the people will not stand up and say, ‘Hey, wait a minute ! That means that we have no power ? There’s no democracy here ?’ They need the lie,” further adding that, “And as long as they can continue the lie and get away with it, they will continue to. And community after community will fight at the Community Board level, fail at the Community Board level, believe you have some legal recourse in the courts, get no legal recourse from the courts, because the courts are fixed.”
When residents’ passions peak during Community Board meetings, Community Board members have been known to retaliate against residents, further compromising the democratic functions of Community Boards. Ms. Boyd has been violently arrested at Brooklyn Community Board 9 for challenging the actions of Community Board members. On one occasion, Ms. Boyd was dragged away from a Community Board meeting and carried out by police officers, who grasped her by her limbs, according to a video recording of the arrest posted to YouTube. In the fight against the rezoning of St. Vincent’s for luxury condos, Manhattan Community Board 2 St. Vincent’s Omnibus committee chair Brad Hoylman, a former employee of Mr. Rudin’s at the Partnership for New York City and now a New York state senator, threatened a senior citizen with arrest, according to a video recording of that episode posted to YouTube. When the civil rights attorney and civic leader Yetta Kurland demanded an investigation of the closing of St. Vincent’s during the same Manhattan Community Board 2 committee meeting, Mr. Hoylman yanked the microphone out of Ms. Kurland’s hands, censoring her speech, according to a video recording of that exchange posted to YouTube. When residents and activists demonstrated at a meeting of the Manhattan Community Board 2 public health committee, the committee members rearranged themselves in a small circle, closed off from the resident audience, refusing to let residents hear their discussions, according to a video of the committee members’ actions posted to YouTube. If these actions do not constitute violations of the state’s open meetings laws, then activists don’t know how much more severe the transgressions against democratic participation in Community Board meetings will need to reach before oversight officials take a serious look at the conduct of Community Board members.
Making determinations of land use more democratic
Ultimately, Ms. Boyd said that communities needed to become educated about important issues, particularly about housing. “The more people that know about this situation, the better,” Ms. Boyd said, adding that, “My job, that I’m taking on, is to do that.” Communities can use social media to inform and to educate themselves about the lack of affordability. For her part, Ms. Boyd is using social media to spread messages by using skits that educate people about gentrification issues.
In her community, Ms. Boyd said that organizing by the community led to achieving wins, like replacing several executive committee members of Community Board 9. Ms. Boyd also said that the activism of the community revealed several issues, including conflicts of interest, that have seriously questioned whether democratic participation by residents in Community Boards actually exists and whether Community Boards are truly autonomous from the political pressures of elected officials and big business groups. Ms. Boyd added that communities that wanted to improve transparency about land use issues can and should exert pressure on their respective Community Boards. Such pressure can produce some improvements in transparency, like what has come about at Brooklyn Community Board 9, Ms. Boyd said. “It’s still not enough,” Ms. Boyd said, adding that, “But we did a lot.” The successes of her group, the Movement to Protect the People, can serve as a template for others. Filing FOIL requests, using the court system, continuing to organize in the communities, and sharing information about laws that protect tenants from landlord harassment are powerful ways that people concerned with land use can make democratic gains in matters of land use.
Regarding land use and activism in general, Ms. Boyd said, “We have to fight for democracy.” One solution, which Ms. Boyd said should be explored, is that communities affected by adverse land use decisions should create a movement to press for the public election of Community Board members, organizing that would require a revision of the City Charter. Ms. Boyd concluded that if the political system needs Community Boards to achieve their political ends, then the Community Board members need to be accountable to residents instead of to the political system.
For her part, Assemblymember Glick said that community organizers had available to them many tools of organzing, including the teachings of Saul Alinsky. However, Assemblymember Glick said she was not in favor of supporting the public election of Community Board members, saying that she had faith in the systems and controls of borough presidents, who oversee Community Boards. Besides, Assemblymember Glick said, opening Community Boards to public election would expose Community Board membership to low voter turnout and to the influence of money in politics. “I don’t think there’s a magic bullet,” Assemblymember Glick told Progress Queens, adding that, “Vigilence by the populace is always important.”
Reflecting on the bright spots of some successes on matters of land use and changes in leadership at some Community Boards, some activists say that external pressures can lead to gains for residents and activists fighting for greater community control over land use. Some point to what is happening down at the South Street Seaport. It has now been named one of the most endangered national historical places as a result of a 40-story luxury condominium tower and shopping mall complex that the Howard Hughes Corporation wants to construct on the site. The South Street Seaport designation of an endangered national historical place has been seen by some as a political move intended to exert pressure on land use officials in New York City to preserve the site, an indication that local community efforts are viewed as insufficient to succeed in preserving the site, affirmation that the municipal land use process does not reflect the values of communities fighting to make historical preservation a priority.
Given the history of corruption in land use, some activists say that the stepped up oversight by federal prosecutors can be a good thing. However, so far, it has turned out to be a mixed bag. Whilst some Community Boards and some real estate tax transactions are facing greater scrutiny, not all matters of land use seem to be receiving the same scrutiny. Moreover, those federal probes are time-consuming ; can drag on almost indefinitely without indictments, depending on the fact patterns of the cases being investigated ; and are dependent upon the political willingness of top U.S. Attorneys to confront corruption in land use matters that may have political implications. In the time leading up to the state legislative renewal of the controversial 421-a tax abatement program that benefits real estate developers and owners to the tune of $1.1 billion annually, government reform activists had been anticipating that the long-expected prosecutorial actions by U.S. Attorney Bharara, the nation’s top federal prosecutor in New York’s southern district, might have had an unintended effect of enfranchising voters by blocking the tax abatement program’s renewal. However, some long-outstanding probes have not yet matured into the filing of federal corruption charges. Notwithstanding, even in the face of intense prosecutorial scrutiny, state legislators enacted a temporary extension of the controversial tax abatement program, which is expected to be further renewed, in due course. Also working against improvements in democratic control over land use matters is the fact that federal prosecutors are providing officials with real estate development companies and their lobbyists with non-prosecution agreements in exchange for their cooperation in the federal corruption probes, meaning that whilst some elected officials may be being held accountable for alleged wrong-doing involving land use matters, officials from the real estate and lobbying industries may not.
What is more, there is a conspicuous lack of public sign-off on the use of parkland for large scale real estate projects, like by New York University in the West Village, or the sale of strategic public assets, like the disposition of the real estate assets of nonprofit hospitals, now including LICH in Brooklyn ; public libraries, like the Brooklyn Heights branch of the Brooklyn Public Library ; community gardens, to make way for affordable housing ; and the city’s public housing authority. The progressive backstop in a representative from of a republican democracy is a voter referendum. Yet, that option has not been invoked by the de Blasio administration. Predictably, the key nonprofit advocacy groups are silent, hesitant to exert direct adversarial political pressure on their close political ally, the Democratic mayor. Meanwhile, the extra-nonprofit activist community is similarly silent.
Until enough of these presently-silent autonomous activists decide that the overall, undemocratic conditions in New York City’s land use are not acceptable, nothing will change.
- 2015-02-10 Shola Olatoye Project Based Section 8 Testimony (City Council) [Scribd]
- 2015-03-26 Shola Olatoye Preliminary-budget-testimony (City Council) [Scribd]
- 2014-10-02 to 2015-03-32 Mayor's Fund -Donors - Conflicts of Interest Board Filing [Scribd]
* Updated : This article was updated to include a brief summary of the findings of the Furman Center study on the profitability of developers leasing NYCHA property for the construction of new apartments.
** Correction : The Robin Hood Foundation was a contributor to the Mayor's Fund to Advance New York City, not to the Campaign for One New York, as was erroneously reported in the first edition of this article.