Doing Ratner's Bidding
June 22nd, 2007
UPDATE: After passing the bill yesterday, the Assembly voted on an amended version today — that still includes the Ratner subsidy. Assemblymember Hakeem Jeffries called to tell us he was one of six members who voted against that bill (A. 9293). “There is absolutely no justification for treating the Atlantic Yards better than any other development project in the city, particularly when Forest City Ratner has already rceived $300 million in government subsidies,” he said. For more on Jeffries positions, see Atlantic Yards Report.
People in government cannot seem to help themselves when it comes to doing favors for Bruce Ratner, developer of Atlantic Yards — whether it’s ousting members of community boards who don’t endorse the megaproject or upping the government subsidy for it.
And now the state is about to hand Ratner a deal that, according to Juan Gonzalez in the News, “is “worth at least $100 million in real estate tax exemptions and possibly as much as $170 million for the market-rate condos Ratner plans to build on the site.” And Gonzalez continues, it will allow Atlantic Yards to charge higher rents for its so-called affordable apartments than any other developer can.
The deal is reportedly the work of the new Brooklyn Democratic Party boss (some things never change, do they?) and State Assembly housing committee chair Vito Lopez and came out of negotiations on the 421-a program, which subsidizes housing construction in New York City
In many ways, the state’s version of the overall program “goes far beyond the City Council’s version passed in December” by expanding the number of communities where builders would have to include affordable housing in order to get tax breaks (rather than getting money for building any housing at all), reports The Real Estate Blog.
There is one big exception: Atlantic Yards. For example, the state measure provides property tax abatements to developers in certain neighborhoods if 20 percent of the apartments in any building are priced for people who make 60 percent of the area’s median incomes. But for Atlantic Yards, the City Room explains, the apartments could be aimed at a more affluent clientele – those making 80 percent of the area’s income. And the requirement will have to be met in Atlantic Yards as a whole, rather than in each of its 16 buildings, giving Ratner the taxpayer’s money for four buildings with absolutely no subsidized housing whatsoever.
The bill was crafted in typical Albany style. Assemblymember Hakeem Jeffries, listed as a cospon sor of the original 421-a bill, told The Real Estate he knew nothing about the special provision.
He voted for the bill anyway.
But as word of the deal spread, so did the objections. “There is no valid justification for this favoritism, and clearly there has been an utter lack of transparency…. Is there any end to the favoritism and backroom dealing that consistently benefits Bruce Ratner?” said Develop Don’t Destroy Brooklyn spokesman, Daniel Goldstein.
“I don’t think there should be special side deals for developers,” Brad Lander, the director of the Pratt Center for Community Development said. “If the point is to use tax policy to encourage the production of affordable housing, then the rules ought to be clear and common.”
Even some Atlantic Yard backers have their doubts. Bertha Lewis of ACORN, which has backed the project on the ground that it would provide affordable housing, called the deal a “special carve-out” for Atlantic Yards and “bad public policy.”
The bill, with its gift to Ratner, requires approval by Governor Elliot Spitzer. “Reflecting his ideals,” writes Atlantic Yards Report, “the governor could take a stand against the process that led to such special pleading. Then again, Spitzer has long supported Atlantic Yards, so this might not be the time to expect him to act on principle.”
The Albany Project summed up the situation: “Everything wrong with New York City and New York State politics is represented in the Ratnerville project. Influence peddling, crony capitalism, back room deals, shady legislation, lack of any meaningful public participation, overt favoritism to monied interests – it’s all there. Stories like this make a mockery of the entire system.”By Gail Robinson on June 22, 2007, 1:11 pm
In category: Albany, Gotham City, Housing, Land Use | 8 Comments »