Noticing New York Discloses What MTA Chairman H. Dale Hemmerdinger Has in His Closet

(Click on image to enlarge)

(This post has been updated as of June 25, 2009 at 12:30 P.M.)

Yesterday we promised to disclose today what MTA Chairman H. Dale Hemmerdinger has in his closet and today we will do so. It may have seemed a little bit personal, which is exactly what we intended. When we made our promise we wanted to remind the MTA board members who were about to vote today that the exercise of their fiduciary duty in their role as members of the MTA board is not something that can be compartmentalized and separated from personal honor and integrity.

(Since we posted this article yesterday, Atlantic Yards Report posted a comprehensive account of the MTA board meeting: Thursday, June 25, 2009, MTA approves deal 10-2 despite warnings from Brennan, Straphangers, RPA; DDDB offer disdained; see video of testimony and board justifications. References in this post to that more recent Atlantic Yards Report post are updates.)

Resplendently Not So Resplendent

We have no doubt that all the evidence is resplendently stark that the bailout for Forest City Ratner approved* by the MTA board was a wired deal. We think that you would have to be a pretty dim bulb for that not to be clearly apparent. As such, we believe that members of the MTA board voting affirmatively today for all the additional giveaways to Forest City Ratner (the dim bulbs among them excluded) violated their fiduciary duty. This was pointed out by many of the public addressing the board before its vote today, including Assemblyman Jim Brennan, who spoke first and reminded the MTA members that they were lowering the price for the sale of the MTA property without first obtaining an appraisal.

(* We were among those commenting- twice- on the New York Times article linked to.)

MTA Approved More That $180 Million in Giveaways For Ratner (Including a Low-cost Very Long-term Option!)

The price the MTA is requiring Forest City Ratner to pay for the property it happens to want right now for the arena was lowered by more than $180 million. Ratner will not have to provide the greater capacity railyard the MTA wanted and until just weeks ago. That extra capacity is important for flexibility as the city grows. The new deal permanently precludes such flexibility for the MTA to expand when the city grows and, as one board member pointed out, the alterative of buying more land later in a growing city will be a highly expensive proposition. The MTA is also now going to forego another $80 million (hence the previously mentioned $180 million figure): It will only charge Forest City Ratner for the land Ratner presently wants for its immediate goal, which is the arena. The MTA is, in fact, charging a proportionately diminished amount at that. With respect to the rest of the property, the MTA is simply giving Forest City Ratner a low-cost very long-term option to continue its monopoly on the potential development of a big hunk of some really good Brooklyn real estate. Though this will forestall alternative development by others and contribute to blight, Forest City Ratner is not really obligated to do anything with the option it may never use. (Forest City Ratner being financially weak, there is the possibility it will simply go under. Unless bailed out yet again?)

The above described sweeteners do not end the list of what the MTA members approved for Ratner today.

No Other Alterative Developers?

Not only did the MTA provide Forest City Ratner with these freebies (there was no corresponding quid pro quo where Ratner agreed to give something back in exchange) without getting the appraisal to which Assemblyman Brennan referred (or planning ever to do so in the future), the MTA did so without testing the market for alternative developers interested in the site. In fact, when today Develop Don’t Destroy Brooklyn actually offered to pay the $120 million for the MTA property (vs. the Ratner $20 million and lesser capacity railyard proposal) the board did not even mention or discuss the DDDB offer before it voted.

Would alternative developers be interested in paying more for the MTA railyard property than Forest City Ratner? The MTA would like to say that such would not be the case. But they never put the supposition to the test and approached no one else. ESDC and the MTA are also promoting certain expedient fictions (like the idea that Atlantic Yards will be built within ten years rather than multiple decades) in order to avoid legal problems. The idea that there would not be any other interested alternative developers if the MTA ever inquired is one of those fictions important for the board’s breach of fiduciary duty not to be more blatantly obvious.

Would alternative developers (other than DDDB) be interested in paying more for the MTA railyard property than Forest City Ratner? We strongly believe such eager developers are actually out there champing at the bit. This we believe is a bigger story we will have to return to at another time.

Chairman Hemmerdinger Unchairs to Leave the Room

The Atlantic Yards Report account of the meeting includes the following description of the Chairman Hemmerdinger/board reaction to the DDDB offer presented by Mr. Goldstein:

MTA Chairman Dale Hemmerdinger had a sour look on his face. No one on the board seemed to looking directly at Goldstein.

In very short order after Mr. Goldstein spoke Chairman Hemmerdinger left the room leaving the chairing of the meeting to another board member. Presumably, Chairman Hemmerdinger left to make a call to whomever was coordinating and orchestrating for the governor (or mayor). The moment was reminiscent of one that occurred on Monday at the MTA Finance Committee meeting when (at 1:20 P.M.), just after the Atlantic Yards portion of the meeting, Chairman Hemmerdinger Chairman Hemmerdinger and Gary Dellaverson, the MTA’’s Chief Financial Officer (who “negotiated” the Ratner deal and presented it at the meeting arose on tandem and jointly left the room while meeting was still in progress. On Monday, Chairman Hemmerdinger returned after about 10 minutes and Mr. Dellaverson did not. Chairman Hemmerdinger subsequently returned for the rest of the Wednesday meeting as well.

Atlantic Yards Report noted that how when one board member spoke against the deal in the meeting “the mustachioed Gary Dellaverson, the MTA’s Chief Financial Officer, looks tense” in the YouTube video supplied on the AYR site. Chairman Hemmerdinger began the meeting directing the MTA members as follows: “Look Comfortable. Cameras are on.”

Def Jam

When Candace Carponter, Counsel for DDDB, addressed the MTA members today (before the DDB offer or the vote) she offered them this definition of fiduciary duty:

"Fiduciary relationships have often been described as 'special relationships,' for good reason. Generally, '[a] fiduciary relationship is a situation where one person reposes special trust in another or where a special duty exists on the part of one person to protect the interests of another.'"

One non-voting member of the MTA (Norman Brown) said that he found it patronizing to have to be told exactly how fiduciary duty is defined though this is something that even attorneys will look up when they intend to carefully advise a client.

Hemmerdinger Goes Off Track To Suggest Approving The Ratner Giveaways for the Wrong Reason (One Inconsistent With MTA’s Fiduciary Duty)

Atlantic Yards Report’s account makes an interesting point on how Hemmerdinger, apparently at a loss for good reasons to recommend approval of the giveaways wound up suggesting that they be approved for reason inconsistent with the ground upon which the MTA needed to base its actions and for reasons which were probably not even supported anywhere in the record:

“ . . . . no deal is ever perfect,” Hemmerdinger said. “You get what you can when you can. And I think, in this economy, jobs and an arena in Brooklyn is a public good.”

In essence, his argument had gone off the rails, the MTA was supposed to vote only in its own interests.

(MTA Chairman H. Dale Hemmerdinger)

Hemmerdinger’s Closet: A Tie

We wrote yesterday about how we do not believe the politically colored events of today can be separated from other things personal and professional. What does Chairman Hemmerdinger have in his closet? Chairman Hemmerdinger is a human being much like ourselves. It so happens that he owns one of our favorite neckties (see the image above). On Monday, when were we were at the MTA waiting to make our statement to the MTA’s finance committee, Chairman Hemmerdinger approached us to comment appreciatively on our necktie and inform us he had the same one at home . . . presumably in his closet. We think of it as an urban design tie (it has on it a print of a New York map) and we think it ought to be worn by people who care about the city.

Spirit of Civitas

Ironically, the tie is by “Civitas.” (It is available through Josh Bach, also in hues of blue.) What does “Civitas” mean? There is a group in New York named Civitas that attends to urban design issues (within the boundaries of Community Boards 8 and 11 on the East Side of upper Manhattan). This is what they provide in terms of what “Civitas” means (emphasis supplied):

In 1981, when CIVITAS was founded, August Heckscher, its first chair, hearkened back to the Roman Republic to find a name that would express the spirit of the new community organization. The name chosen, "CIVITAS," referred to that quality of a citizen that made him deeply involved in the life and fate of his city. Such has been the guiding spirit for CIVITAS ever since.

Scale and Community Participation

Ironically, Civitas has concerned itself with things similar to what generates so much concern with respect to Atlantic Yards, though only in its own area of the city: for instance, the scale of new unwanted towers. Civitas has also complained about the way communities attempting to participate in planning their own neighborhoods are ignored. Here from Atlantic Yards Report:

Genie Rice of Civitas said that there has been community planning, but 197-A plans produced by Community Boards are “totally ignored.”

Perhaps Civitas will be concerned with what is happening at Atlantic Yards since Atlantic Yards is now draining the coffers of the MTA even further. After all, every citizen cares about funds for mass transit.

Romanesque

“Civitas” derives originally from the term used to describe Roman citizenship. We will think of it in terms of the qualities of civility and duty to your fellow citizens required for civilized communities to work. We do not believe that the actions of the MTA board today can be considered consistent with those qualities or civil obligations.

Sacrificial Pattern

Here is another irony: The thing that makes our Civitas necktie wonderful is the street grid pattern it displays. The street grid is something we revere and something also celebrated by Jane Jacobs, who called for short blocks and frequent streets. She was opposed to superblocks and their resulting elimination of streets from the grid, exactly what is being proposed for Atlantic Yards. (Elimination of the grid is being proposed so that developer can go even further in squeezing buildings of unprecedented density into the brownstone neighborhood.)

Our necktie would be a lot less interesting if the New York streets on it were eliminated. Similarly, Brooklyn will become a much more desultory and less interesting place if Atlantic Yards is built. It would ruin the “fabric” of the city both figuratively and literally.

Keeping It In The Closet

We may have things in common with Mr. Hemmerdinger, but we think that in making his decisions today and leading the board through its mistakes Mr. Hemmerdinger was driven by ties other than what we have in common. We also think that what was done today was so egregious that we don’t expect this MTA debacle to be over. In other words, don’t expect that everything has been put away and will stay in the closet.

06/25/'09 UPDATE: This morning, Atlantic Yards Report today provided a report of yesterday’s board meeting that concluded with the following:

(A reader points out the Hemmerdinger was sued less than a month ago, according to Crain's, by "partners in one of his buildings [who] allege he illegally drained $2.2 million from funds set aside to run the property in order to create a crisis and buy them out.")

The Crain’s story says that the plaintiff’s in the lawsuit “against Mr. Hemmerdinger and his son, Damon” include “two half-brothers of Mr. Hemmerdinger.” Just for the record, that “reader” wasn’t us: We weren’t up on our reading of Crain’s and hadn’t come across its story. Any coincidence between what Crain’s reported and what we wrote on Tuesday, June 23rd must be ascribed either to coincidence or a healthy sixth sense. On Tuesday we wrote in relation to Mr. Hemmerdinger’s real estate and other activities:

As one can see, there are in these activities a great many situations where Mr. Hemmerdinger has significant fiduciary duties and other responsibilities wherein others need to put faith and trust in him. Inevitably, these are all connected just as even our honesty in dealing with our families also relates to such things.

Atlantic Yards, Metaphorically Speaking

Finding the right metaphor to describe Atlantic Yards can be edifying and, at the same time, a challenge. Recently, ESDC head Marisa Lago formulated the metaphor of Atlantic Yards as a kitchen renovation. We found that her metaphor adapted quite well for our purposes. (See: Monday, June 1, 2009, Negotiating With Your Contractor: The Atlantic Yards As Kitchen Renovation Metaphor.)

It is not so clear that Ms. Lago herself had success with the metaphor because exactly one week after she coined it she was let go from ESDC after having served barely nine months in her position. (See: (See: Friday, June 05, 2009, Observer: internal ESDC turmoil leads to resignation of CEO Lago; AYR: did testimony gnaw at her conscience?.)

Zombiefication

We noticed that Develop Don’t Destroy was recently offering a new metaphor, describing Atlantic Yards as a “Zombie Project.” (See: Nets, Ratner, Yormark Desperately Trying to Market Zombie Project, posted: 6.04.09.) The idea behind that, of course, is that the strange political forces that keep re-animating Atlantic Yards don’t seem to recognize when a natural death and permanent grave rest under the lilies is appropriate.

We can offer a quibble on the zombiefication of the project. When it comes to zombies, we had previously declared the developer, Forest City Ratner, to be the “zombie,” not the project.

Our developer-as-Zombie pieces were as follows:

Thursday, March 19, 2009, Willets Point Lawsuit Points Out . . .

Tuesday, March 31, 2009, Looking at Things From Another Point of View: Do We See Distinctions That Make A Difference?

In them we talked about getting into the situation where government props up failing or financially weak developers on the theory that they can’t be allowed to fail. We referred to this as government’s getting into “a zombie subsidy bear-hug” with a developer. Instead, we suggested that the self-serving “contracts” with the zombie developer/subsidy collector Forest City Ratner ought simply to be repudiated. It turns out that with Atlantic Yards no “repudiation” was even necessary since the MTA has never even entered into a contract with Forest City Ratner for the project. (See: Tuesday, June 23, 2009, Thoughts on the MTA’s Finance Committee Meeting Wherein Atlantic Yards Was Considered as an “Information Item”.)

Zombie Subsidy Bear-Hugs

The kind of “zombie subsidy bear-hug” we were referring to is the kind of thing the MTA and ESDC are now getting into with the financially ailing Forest City Ratner (the developer has a speculative credit rating of B1 and a stock value that has been at zero). Both agencies are looking to bail out the developer with a package of sweeteners on Atlantic Yards, the value of which is substantial. It starts with the $100 million in value with respect to the MTA railyard capacity that the zombie developer will be excused from providing, plus the $80 million the MTA won’t be collecting from Ratner for its land in the MTA’s time of financial need. There is a lot more sweetener with other benefits not being provided in the foreseeable future and timetables and deadlines being deferred. For starters see: Tuesday, June 23, 2009, Thoughts on the MTA’s Finance Committee Meeting Wherein Atlantic Yards Was Considered as an “Information Item”.

What we also refer to when we use the term “zombie subsidy bear-hug” is what Raul Rothblatt was talking about when he testified this morning at the ESDC board meeting. ESDC voted to approve the sweetening package for Ratner, worth however many hundred million dollars. Before they did, however, Mr. Rothblatt asked the ESDC board members what possible subsequent request from Ratner they would ever be able to refuse in the future if they approved this one. Probably none. That’s the nature of the hug.

Talking Serious Economics

The developer-zombie metaphor actually has a very respectable antecedent in economics. Essentially we derived it from the term “zombie bank” used by commentators such as Paul Krugman. The term refers to insolvent banks that should go out of business but are propped up by the government. First talked about in terms of the Japanese financial crisis that dragged on for years, zombie banks are generally thought to be a rather bad thing that prevents the economy from acting normally and with its usual vigor because economic incentives for proper performance get all bollixed up. The living dead parade around confusingly in what should be the land of the living. Welcome to the world Governor Paterson and Mayor Bloomberg are fashioning for us.

Political Possum

We thought that while zombie was the best metaphor for the developer, the project could be described with another metaphor: We said that the project had been playing “political possum.” The highly unpopular megadevelopment had been playing dead until recently (the dead thing again) so that politicians like Bloomberg and Paterson could avoid mentioning it or openly supporting it. The problem is that now that possum is getting ready to come back to life and scurry past the public as fast as possible. (For the possum metaphor see: Thursday, May 7, 2009, City Council Races (33rd and 39th CDs): Candidates’ Positions on Development and Effective Action They Would Take to Stop Atlantic Yards (Part III).)

Another Brand of the Undead

We also described the project as Dracula, a desicated corpse frying in the sunlight of public scrutiny that is still not truly dead until a stake has been put through its heart, its head has been cut off and its mouth stuffed with garlic. We called for responsible politicians to affirmatively kill the project. For this see: Wednesday, May 6, 2009, City Council Races (33rd and 39th CDs): Candidates’ Positions on Development and Effective Action They Would Take to Stop Atlantic Yards (Part II).

The vampire description has also been applied to developer Bruce Ratner himself. At the community protest when the Brooklyn Museum “honored” Bruce Ratner, there were signs and chants that “Ratner is a vampire” referring, no doubt, to his willingness to enervate the community by sucking on its blood for his own sustenance.

Monster or Its Creator?

Is Ratner the vampire, or his project? Is the developer the zombie, or the project? This gets into the classic conundrum of how the monster can often be confused with its creator. When we hear “Frankenstein” do with think of the monster or Dr. Victor Frankenstein who created it?

Bait and “Stitched?”

Frankenstein might, in fact, be a another good metaphor for the project since it is such a stitch-together pastiche of dead and improbable promises robbed from the musty tombs that hold so many past ill-conceived megadevelopment projects. We can imagine the laboratory where efforts are made to jolt the cobbled together monstrosity to life using Marty Markowitz’s silly boosterism as energy.

Lie-Can-Thropy

Maybe though the vampire metaphor is a good one to stick with in light of all the recent changes in the proposed monopoly-megaproject. We have seen the departure of Frank Gehry and Laurie Olin, replaced by an incredibly different low-rent design team. Vampires have the power of lycanthropy, the power to shape shift into other animals (yes, similar to werewolves). Perhaps that serves well because these days the moral with Atlantic Yards is that even though it is guaranteed to be something terrible, it is changing around a lot. It has no real defined shape so that if our public officials launch it there is no telling what we might one day actually get.

Coming Tomorrow: Noticing New York Discloses What MTA Chairman H. Dale Hemmerdinger Has in His Closet

(MTA Chairman H. Dale Hemmerdinger)

Tomorrow Noticing New York will disclose something about what MTA Chairman H. Dale Hemmerdinger has in his closet.

Preparatory to that, a few things first. Yesterday we spent the greater portion of our day at the MTA in order to be present and also testify when the MTA’s Finance Committee heard new information about Atlantic Yards. (See: Tuesday, June 23, 2009, Thoughts on the MTA’s Finance Committee Meeting Wherein Atlantic Yards Was Considered as an “Information Item” and Monday, June 22, 2009, More on Planning in Advance to Bail Out Forest City Ratner Upon the Inevitable Arrival of an Economic Downturn.)

One thing we concerned ourselves with in our testimony and about which we have recently written is the board members’ obligation to respect and live by their fiduciary duty when they vote on Atlantic Yards. (See: Monday, June 22, 2009, Plus Ça Change, (The More Things Change,) Plus Une Chose En Particulier Ne Change Pas: La Transaction Fixée (The Wired Deal)! )

We think that we ought to observe that this is not an abstract concept that is divorced from the other things that happen in life. Just because someone is a board member of a public agency doesn’t mean that this “fiduciary duty” becomes a fiction that can somehow be supplanted by political realty. A fiduciary duty is a real legal obligation and related to the other things one does in life.

We are aware that board members of public agencies are real people who have real private and professional lives and that in those lives there are also responsibilities and obligations and even other fiduciary duties they must observe in other contexts. This may extend to such things as the fiduciary duty to properly administer a relative’s trust or estate and, for instance, we note that Mr. Hemmerdinger, to quote just from what is available on the MTA’s website:

. . . . is president and director of The Hemmerdinger Corporation, a commercial and residential real estate ownership and development company based in New York City.

He also serves as president of Atco Properties & Management, Inc. and Atco Properties Services Corporation and is chairman of Atlas Real Estate Funds, Inc. He is also a board member of Valley National Bank.

Mr. Hemmerdinger is active in civic and business affairs in the New York region and is a trustee and secretary/treasurer of the NYC Police Foundation, a partner in the Partnership for New York City, and trustee and chairman emeritus of the Citizens Budget Commission. He serves as executive vice president of the Realty Foundation of New York, is a member of the Real Estate Board of New York, and is a former commissioner of the City of New York Conciliation and Appeals Board.

He is a 1967 graduate of New York University, where he also did graduate work, and is a trustee of the university, where he is on the budget/finance, alumni relations, library, and executive committees.

As one can see, there are in these activities a great many situations where Mr. Hemmerdinger has significant fiduciary duties and other responsibilities wherein others need to put faith and trust in him. Inevitably, these are all connected just as even our honesty in dealing with our families also relates to such things. You can’t have a breach of trust in one area of your life and not expect repercussions in another area. When it comes to such things one should not expect that expect failure to observe duties and responsibilities and maintain trust can be isolated by cognitive dissonance. Even legally, breaches may well wind up being very much connected.

That is all we will say for now. And we say because we hope that tomorrow the members of the MTA board will remember that they have a fiduciary duty to uphold. We hope they know that failure to uphold these responsibilities cannot be a discrete and separate thing.

And for tomorrow we also offer the promise that we will disclose something about what MTA Chairman H. Dale Hemmerdinger has in his closet.

Thoughts on the MTA’s Finance Committee Meeting Wherein Atlantic Yards Was Considered as an “Information Item”

There is much to tell about the Monday morning meeting of the MTA's Finance Committee where a new bailout edition of Atlantic Yards was the subject.

Best Account of MTA Finance Committee Meeting

As usual, if you want the best account of what happened at the MTA’s Finance Committee meeting on Monday wherein Atlantic Yards Was Considered as an “Information Item” you should go to Atlantic Yards Report. (See: Monday, June 22, 2009, MTA deal revealed: $20M down, 22 years to pay the rest; smaller yard may save FCR $100 million; some skeptical about rush.)

Noticing New York’s Testimony

If you want to know what we testified, it is true that we essentially reprised our post from early that morning about how all the changes swirling around and through what was theoretically once was “Atlantic Yards” have melted all other pretext away. Only one obvious fact remains. Atlantic Yards is being done not for reasons of merit. It is being done only because it is a “wired deal” where merit is irrelevant. (Our morning’s post was: Monday, June 22, 2009, Plus Ça Change, (The More Things Change,) Plus Une Chose En Particulier Ne Change Pas: La Transaction Fixée (The Wired Deal)!) We handed in our post as written testimony.

Emphasis of Noticing New York’s Oral Testimony

We did, however, adjust our oral testimony to make sure we led with something that was in direct opposition to the nonsense being peddled to sell the Forest City Ratner bailout. We pointed out that in an economic downturn the ability to negotiate a better deal should be in the public's favor, not the developer's. For more about this and our thoughts on the testimony of Kathryn Wylde of the Partnership for New York City, Joseph Chan of the Downtown Brooklyn Partnership see: Monday, June 22, 2009, More on Planning in Advance to Bail out Forest City Ratner Upon the Inevitable Arrival of an Economic Downturn.

Purpose of this Post: Supplemental Thoughts

This post is to offer our thoughts supplemental to all of the above.

Deal Sprung on the Committee is an “Information Item” Only

The Finance Committee was considering the revamping of the degenerating Atlantic Yards as only an "information item" because the committee members were only just seeing the item for the first time. As they had no time to absorb the information they were not being asked to actually vote on the item. That was small comfort because in two days time (on Wednesday) they would be asked to vote as part of the full board, apparently skipping a committee approval. This also presupposes that the ESDC would approve the very complex deal only a day later without making any changes. Such swiftness is, of course, indicative of the wired nature of the deal.

Transportation, Job One at the MTA, Suffers a Blow

As Atlantic Yards Report reported about MTA Chief Financial Officer Gary Dellaverson's stated priorities:

"Our interests are transportation first, financial second," Dellaverson said, implying that development over the railyard--and the removal of the blight the open railyard has been said to cause--comes third on the list.

Notwithstanding, it seemed clear that the most important news is that MTA’s ability to provide transportation will suffer.

The concessions to accommodate Forest City Ratner involve significantly diminishing the capacity of the railyard and doing so in a way that allows little or absolutely no flexibility to ever expand it again later despite the fact that the city is growing and such flexibility is valuable and highly desirable.

It was noted by Board member Andrew Albert only “a couple of weeks” prior thereto MTA Acting Executive Director Helena Williams had been “pretty clear about needing 9 tracks versus 7 tracks.” We had to wonder about the fact that Helena Williams was not at the meeting. Representations were made in her absence that she was now “completely comfortable” with the downsizing and lack of future flexibility the Ratner concessions would involve.

In her absence most of the information was being supplied by Mr. Dellaverson. It was interesting how Dellaverson had to be chased with successive rounds of questions to give a straight answer about the fact that the deal being proposed for Ratner would mean not only a railyard with less capacity but one that would also lock in the MTA, permanently preventing the possibility of further expansion in the future because once the yards were platformed over and supported by immovable pillars between the tracks no further change would be possible. Prior to actually admitting this, Dellaverson's evasions were described politely by a female board member trying to get a straight answer as "a lovely way with the English language."

Dellaverson finally responded that if the question was about possible expansion for a "more robust" railyard that, after the platform was built it would be a "real pain in the ass to enlarge." That apparently was not exactly accurate because further discussions indicated that it would actually be virtually impossible to enlarge the yard after that.

One board member commented how valuable MTA normally considered yards that provided capacity and flexibility for future growth.

The Blow to the MTA's Job One in Quantified Terms (For Starters)

From Atlantic Yards Report:

The new railyard would be valued at $147 million, while MTA Chief Financial Officer Gary Dellaverson said the previous iteration was worth $240-$250 million.

In just one blow, a quantifiable hundred million sweetening of the deal for Ratner. Of course that is just one of the sweeteners proposed as part of the "renegotiation" constituting the Ratner bailout. The value of other sweeteners need to be added to it.

A Board Member’s Outrage at a Last Minute “Railroading” Rush

One board member complained about the outrage of being rushed at the last minute on a complex deal. Here from the Times:

“It is one month shy of four years since the board accepted Forest City Ratner, and this committee is being given less than 48 hours to understand a complex transaction,” complained Doreen M. Frasca, who has raised concerns recently about the M.T.A.’s financing decisions. “I think that’s pretty outrageous,” she added.

(See: June 22, 2009, Developer Seeks to Defer Payments on Atlantic Yards Site, by Michael M. Grynbaum.)

Mr. Dellaverson was clear that the board members were being rushed because of the schedule the Forest City Ratner bond deal for the arena needed to meet. This is not to say that the last-minute rush was not manufactured. As board member Frasca had already pointed out, Forest City Ratner could have moved to go forward on this a long time ago. That being so obvious, we think the facts point to a conscious effort to short-change the board of the time needed to properly evaluate and think about the transaction.

Absence of An Actual Deal With Ratner

Politicians should also pay attention to the board's question and Dellaverson answer about whether the MTA was "contractually obligated" with respect to the “deal” with Forest City Ratner. Several times the “deal” was referred to by Dellaverson as "never papered over." Mr. Dellaverson’s answer on whether the MTA was contractually obligated: "Of Course not!"

So if politicians ever wondered how easy it would have been or is for the MTA to walk away from this deal, the answer is that it is no problem at all.

In fact, Mr. Dellaverson indicated that there were some aspects of the original deal he was not even sure he remembered and would only know about if he dug up notes he hasn't looked at recently.

Switching to Another (Perhaps More Solvent) Developer

Mr. Dellaverson was also asked by a board member about switching to another contractor. He was given the example of what would be possible if Extell (the developer that has previously offered the MTA more money than Forest City Ratner) came forward to indicate a current interest. He seemed to view that as an interesting but academic proposition. He noted that Extell had not approached the MTA. It was clear from what he was saying that the MTA had not bothered to contact Extell or anyone else. The MTA has thereby intentionally kept the idea of another contractor entirely theoretical.

Afterwards on WNYC there was a report where the MTA (Mr. Dellaverson?) was saying that the reason to accommodate Ratner was the MTA’s inability to find a replacement contractor.

Of course, it would be unlikely that Extell would come forward uninvited at this point. When last we heard from Extell with respect to bidding on the Atlantic Yards site, Gary Barnett, the president of Extell was invoking images of Casablanca with his references to being "shocked— shocked" not to have gotten the original bid when they outbid Forest City Ratner. (See: Thursday, December 27, 2007, Clear enough? Misreading the Extell interview regarding Atlantic Yards.)

It is, in fact, unlikely that any alternative contractor will bother to darken the MTA’s doorstep until the MTA sends out the signal that Ratner’s deal is no longer specially wired. Obviously, that is not the message now being telegraphed.

Multiple (Six) Development Parcels

One thing that has interesting implications in terms of bidding is the MTA’s division of its portion (40%) of the overall Atlantic Yards site into six development parcels. Here from Atlantic Yards Report:

Dellaverson said the MTA divides the rest of the railyard into six development parcels, as six buildings have been projected to be built. A parcel purchase price would be assigned based on the total payment for the "Air Rights Parcel" and the proportional density assigned to each of the six segements.

Regular payments of the total purchase price would be allotted proportionally to each development parcel, with that parcel conveyed to ESDC or FCR only when the proportional price was met.

We have always advocated dividing the site up into separate parcels so there could be separate developers and more bids. It seems the MTA is proposing to do the division without using the opportunity bid the property. (The six parcels may allow FCR more flexibility, especially of it runs into a financial fix where it is struggling not to go under). Ironically, later in the afternoon on an entirely separate matter the committee was reviewing recommendations about breaking propsective large MTA contracts into smaller bundles as a matter of principle in order to have more effective bidding.

Pricing of the First Parcel (the Arena Parcel) For Ratner

Dellaverson was noninformative when asked about how the first parcel being transferred to Ratner for the arena had been priced. Apparently it had been priced through the art of negotiation. Dellaverson said it had not been priced by the MTA based on calculations of the value of what could be built upon it. (We can’t imagine that Forest City Ratner ignored paying attention to this.) Dellaverson said that the MTA value of the land could not be set because the ESDC was doing the zoning override. This would seem to have some odd implications and, looking at the staff summary, we are not sure it is accurate.

MTA to Set Precedent By Selling Naming Rights to Subway: First Step in Commencement of a New Program?

Here from Atlantic Yards Report:

Also, in what represents the first MTA naming rights deal for a subway station, FCR would pay $200,000 a year over 20 years to have the name Barclays Center added to the various stations that make up the Atlantic Avenue/Pacific Street complex.

There were no comparables for that deal in New York, but Dellaverson said MTA staff did look at naming-rights arrangements in other cities.

We find this fascinating. If this is appropriate the MTA could sell off the entire subway system at $200,000 a year per station. Columbus Circle will now be the Columbus Circle/AOL Time Warner Station. Oops- - No AOL anymore, just Time Warner then. Grand Central could be Grand Central/Pan Am Station. Oops- - No Pan Am anymore, Met Life then. Given all the turmoil in the financial world, will Barclays be around for “20 years”? Maybe so. If they have been around long enough to have been involved in the slave trade maybe it can be argued they will be around for a few more years.

(Note: This post will be updated, including correction of typos.)

More on Planning in Advance to Bail Out Forest City Ratner Upon the Inevitable Arrival of an Economic Downturn

Norman Oder pointed out in his Atlantic Yards Report that “Forest City Ratner started renegotiating the deal before the economic downturn” and, just this morning, he linked back to our last Noticing New York post to point to our observation that, given Atlantic Yards’ multi-decade time frame, its encounter with economic downturn was inevitable. (See: Monday, June 22, 2009, Why an economic downturn should have been factored into AY plans.)

We are now happy to add one more reason why the economic downturn should always have been factored into Atlantic Yards plans from the beginning.

We spent the greater portion of our day today at the MTA, sitting through its committee meetings in order to be there when the MTA’s Finance Committee heard new information about Atlantic Yards. And we even testified. Mr. Oder noted that we “reprised” our “post about how it was a `wired deal.’” Indeed we did and we led with something that was in direct opposition to the nonsensical notion that was being peddled as a reason to revamp the degenerating project, that the `deal’ with Forest City Ratner should be renegotiated in the developer’s favor because of the economic downturn. Au contraire (to stick with our recent theme of speaking French), in an economic downturn the ability to negotiate a better deal should be in the public's favor, not the developer's! (See: Thursday, April 16, 2009, The Great Recession: A Stimulus to Get Our City Back to “Bidness?” and Monday, June 1, 2009, Negotiating With Your Contractor: The Atlantic Yards As Kitchen Renovation Metaphor.)

We testified right after Kathy Wylde of the Partnership for New York City, so we were able in our testimony to say that her testimony that the partnership had “always supported” the Atlantic Yards project now being considered by the MTA was hokum because that would involve a blatant disregard for the slew of changes now being foisted on the public by means of the ongoing bait and switch. The Partnership always supported the Atlantic Yards project now before the MTA? Seriously, that makes it sound rather like the Partnership was in cahoots with and a part of the bait and switch from the beginning. We won’t accuse the Partnership of that but we do think that highly paid professionals should have seen all this coming from the outset. Nor do we think that the Partnership should have supported the original Atlantic Yards: The partnership is supposed to support what is good for New York, not what is destructive of it.

(BTW: Not that we have hard feelings about it but Kathy spoke before us because somehow she jumped the line. We signed in first and were called up first and then somehow the MTA staff switched over to Kathy instead. Can’t guess what that was all about.)

While Kathy preceded us, Joseph Chan of the Downtown Brooklyn Partnership spoke after us so we didn’t have a chance to testify about what he said but this is where planning in advance for economic downturns comes up again. We’ll comment here instead. Most of the eloquence from those speaking about the project came from the project’s opponents (yes, we are partial to their point of view), but Mr. Chan and Ms. Wylde have their jobs because they are expected to be able to be reasonably persuasive. They were, in fact, the best of the lot in terms of speaking in favor of the project even if what they said was dry, canned and bit divorced from actual appreciation for the real saga and true flavor of things.

Mr. Chan said that he actually thought that the new switched Atlantic Yards would be good for Downtown Brooklyn (of which Atlantic Yards is not a part, though it is within walking distance). Please do some more homework, Mr. Chan: Even the original Atlantic Yards would have been destructive and a net negative.

Mr. Chan also spoke specifically and favorably about Forest City Ratner as a developer and in doing so he made this claim; that Forest City Ratner is the right developer to hand a project over to at any time in the real estate cycle, in good times and in times of economic downturn! Good sales pitch, but if Forest City Ratner is specially suited to working on projects during economic downturns (and should be even be awarded a large-scale monopoly with that in mind) why then was the very purpose of the scheduled MTA and ESDC meetings to bail them out financially because of the unforseen economic downturn?

Plus Ça Change, (The More Things Change,) Plus Une Chose En Particulier Ne Change Pas: La Transaction Fixée (The Wired Deal)!

At Senator Bill Perkins’ Senate hearing on Atlantic Yards on Friday, May 29, 2009, Assemblyman Hakeem Jeffries questioned whether the MTA and its board members would be acting in accordance with their fiduciary duty to the public if, as the MTA is discussing doing, the MTA and its board act to bail out the financially ailing Forest City Ratner, the proposed developer of the proposed Atlantic Yards project.

What’s Contemplated in Terms of Bailing Out The Developer

In terms of bailout, the MTA is talking about:

1. Letting the developer construct a project of significantly lesser public value under rubric of "value engineering" (translated, that means, among other things, constructing a train yard with 7 tracks rather than 9 or the original 10, delivering a project of much lesser quality, and with less “green space”).

2. Giving the MTA’s property to the developer (property for which the developer did not bid in the first place) for a considerably smaller payment despite this currently being a time of financial need for the MTA. (We are now talking in terms of the pathetically paltry. See Atlantic Yards Report “What could $20 million buy?” series.)

3. Less will be done by the developer up front, and

4. Postponing, even further, the borrower’s obligation to deliver the ostensible benefits of the project. For instance, one housing tower that would be front-loaded with luxury units while others will be postponed.

Further, this proposed bailout is being pushed at a time when we are learning that the project will not, in fact, deliver the de minimus ostensible benefits it was once supposed it would. At least the arena, and probably for a very long time the entire project, will NOT be a net economic positive for New York City according to the reckoning of the City Independent Budget Office. Even when the boosters of the project (the government officials working for the development agencies) were telling the questionable version of the story, which they apparently hoped would sell the project, they said that the completed project would provide the benefits they calculated only upon the passage of 30 years. By current projections it may take 30 years before the project is even complete. Does that mean the “benefits” take sixty years to fully materialize? It seems fair to ask.

Fiduciary Duty Reminder

Not long after the Perkins hearing, Assemblyman Brodsky, who chairs the state Assembly Committee on Corporations, Authorities, and Commissions, followed up on Assemblyman Jeffries' question about the board members’ fiduciary duty to the public. He “warned . . . that, if the Metropolitan Transportation Authority (MTA) board accepts `less money’ for the property destined for the Brooklyn arena, it would “be a violation of the fiduciary duty”--their obligation to act with the highest standard of care. (See: Monday, June 08, 2009, Brodsky: MTA board’s acceptance of Ratner’s lesser offer for railyard would violate its fiduciary duty.)

Time Ushers in Changes (Et Non . . .)

We think the board members of the MTA and ESDC are now in a pretty good fix if they want to vote for Atlantic Yards but want to claim they are not violating their fiduciary duties. This is because time has done a remarkable job of melting away all aspects of Atlantic Yards, leaving nothing but one sinewy strand that won’t dissolve, one single cord that represents Atlantic Yards, its core essence. What is that core essence? It is Atlantic Yards as the wired deal, the mega-boondoggle, designed to serve no one but a single connected developer.

Pardon Our French (For a Change)

What can be a more instructive to learn about this exercise in civic malfeasance than to look, on one hand, at all that has changed, and, on the other, at the very little that has not changed, going back to when the original project approvals were rammed through with a concerted effort to shun a proper public vetting. Hence the title of this article. The French say that “the more things change, the more they stay the same.” (“Plus ça change, plus c'est la même chose.”) But in the case of Atlantic Yards, it seems as if just about everything does change and only one thing does not. We had thought, originally, to title this: “Plus ça change, (The more things change,) plus c'est la même chose particulier- Le Deal (Transaction) Wired!” but we will, instead use what we understand to be the better French and say: “Plus Ça Change, (The More Things Change,) Plus Une Chose En Particulier Ne Change Pas: La Transaction Fixée (The Wired Deal)!” No matter, the facts are perfectly plain in any language no matter the precision of our syntax.

What’s Changed? For Starters, the Economy

We have already written about how the changes in the economy should mean that now is the very time when the public should be expecting a much better deal from any developer it is dealing with. (As opposed to the significantly worse one now proposed for Atlantic Yards.) As we have written, other state and local governments are finding that public funds go a lot further and can buy a lot more considering the downtown in the economy. Furthermore, it is reported that Forest City Ratner is taking advantage of the downturn to get a much better deal from the contractors it is dealing with. (See: Thursday, April 16, 2009, The Great Recession: A Stimulus to Get Our City Back to “Bidness?” and Monday, June 1, 2009, Negotiating With Your Contractor: The Atlantic Yards As Kitchen Renovation Metaphor.)

If anyone tells you that a downturn in the economy is a reason the public should get a worse deal and the developer a better one (See: Friday, June 19, 2009, Keep your eye on the ball: FCR began renegotiating this deal well before the economic downturn), don’t believe them.

What Else Has Changed? Almost Everyone Else in the Cast of Characters, But. . .

It was startling to read the other day a No Land Grab accounting that summed up all of the individual players, public officials included, that have come and gone since the original Atlantic Yards mega-boondoggle was unveiled on the public stage. (See: June 6, 2009, More Disarray for the ESDC: Chairwoman Marisa Lago Quits.) Not only is Starchitect Frank Gehry now gone but Governors: George Pataki and Eliot Spitzer have departed, the latter rather ignominiously (including the way he acquitted himself on Atlantic Yards). It looks as if Governor Paterson is also likely to depart the Atlantic Yards scene sans any distinction unless he exercises his ability (and we would say clear duty) to let Atlantic Yards die the death it so richly deserves.

No Land Grab goes on with its listing, Assemblymember: Roger Green has departed, ESDC Heads Charles Gargano, Patrick Foye, Avi Schick, and Marisa Lago are all listed as departing. No Land Grab’s summing up was before the even more recent reports that ESDC Chairman Bob Wilmers, resigned from his post. (See: Thursday, June 11, 2009, Even more turmoil at ESDC: the Chairman resigns, and a Republican businessman from Rochester will be in charge.) No Land Grab reminds us that MTA heads Peter Kalikow, Katherine Lapp and Eliot Sander also have all departed. From the Forest City Ratner team there were these exits (in addition to Gehry) listed by No Land Grab: Jim Stuckey, Loren Riegelhaupt, Randall Toure. No Land Grab mentions that any key players missing was unintended. We would have added to this list the departure of landscape architect Laurie Olin. Concluding the list are departures from the “Team Nets”: Kenyon Martin, Jason Kidd, Richard Jefferson.

Changed Politics

The politics of Atlantic Yards have also changed. Once there were a few politicians who were sufficiently hornswoggled (or thought others were) to support the project in some (perhaps lukewarm) fashion. More recently, the project hasn’t found that kind of support. (See: City Council candidates don't support AY project, May 08, 2009, May 7, 2009, City Council Races (33rd and 39th CDs): Candidates’ Positions on Development and Effective Action They Would Take to Stop Atlantic Yards and Friday, June 19, 2009, Brennan, other elected officials urge MTA to delay June 24 vote, say hasty decision may hurt transit system.) The only kind of support it now gets is by Marty Markowitz or by the stealth of politicians like Bloomberg and Paterson who seem to prefer not to mention the project when they can avoid doing so.

Political support fell out from under the mega-boondoggle before the recent set of proposed changes that would make the megadevelopment so much worse, before the most recently released information concerning the calculations about the ways in which, for instance, the arena will be a net loss to the public.

IRS Position on Tax Exemption Changed

Even the financing permissible under applicable IRS regulations has changed. The contemplated financing of the Atlantic Yards Nets arena (about the only thing proposed to proceed in the near future) by the peculiar mechanism of “R-TIFC Bonds” (pronounced "Artifice-PILOT"- or "Return Total Intercepted For Costs-Payment In Lieu Of Taxes") is something that the IRS would not now permit for any project of this sort. It is a testament to exactly what we are talking about: Atlantic Yards as a “wired deal,” that somehow this very substantially changed deal may be “grandfathered” under an IRS regulation to allow this single project to issue Artifice-PILOT bonds that probably should always have been illegal. Procuring the IRS ruling involved New York public officials coordinating with the developer in making misrepresentations to the IRS when the IRS ruling was requested. (See: Tuesday, May 19, 2009, Looking back at that IRS letter: did ESDC stretch the truth about the project timetable? and Monday, July 21, 2008, Asking feds not to approve tax-exempt bonds for AY arena, DDDB criticizes city/state letter) Those public officials were likely already inured to the making of misrepresentations to the IRS based on prior similar conduct. See: Wednesday, October 1, 2008, Safety in the Numbers You Pull out of a Hat.)

In the Sea of Change What Doesn’t Change?

It is scary to think that with all that has changed, the economy, the design of the project, the architect and landscape architect, the project’s measurable public benefit (actually its total lack of actual measurable benefit), the politicians, the transaction technicians, only one thing durably remains- The designation of a developer who is on the receiving end of a humongous boondoggle. This fits with the theories of the conspiratorialists who tell us that politicians are just irrelevant intermediaries and that power truly resides in a plutocratic class of businessmen who get to tell politicians what to do. We don’t subscribe to such theories, but we are hard pressed to refute these ideas when confronted by scenarios like what we see playing out now with Atlantic Yards.

The Developer Hasn’t Changed? Let Us Offer a Correction

Actually, it is misleading to say in unequivocal terms that the developer hasn’t changed. The developer is nominally the same developer, but much has changed about the developer. What is different is that the developer is now teetering financially. Forest City Ratner’s credit is in the toilet and we have been watching, wondering whether they will go under entirely. (See: Tuesday, March 17, 2009, Three months later, Morningstar again says Forest City Enterprises stock is worthless.) The developer is certainly not now the kind of strong credit-worthy developer you would rationally contemplate choosing if you were going to hand out a monopoly for the development of a vast swath of the nation’s largest city.

Putting it more frankly, this is exactly the kind of situation where, because of the changes with the developer, public officials ought to be looking for ways to terminate the transaction with the developer.

Contemporaneous Beekman Problems

We found it interesting that, contemporaneously with Morningstar once more calling Forest City Ratner’s stock worthless, the developer stopped construction on its Beekman Tower in lower Manhattan. (See: Downtown Housing Complex May Downsize, by Matthew Schuerman, March 19, 2009.) The official story was that Forest City Ratner wanted to take advantage of the downturn in the economy to negotiate a better deal with its contractors. (You know, that better deal they don’t want to share with New York taxpayers when they do Atlantic Yards as we talked about earlier in this post.)

Musing on Forest City Ratner and Material Adverse Change

The fact is that Forest City Ratner reportedly did get that better deal on the Beekman (See: Savings on Labor Allow Work on Residential Skyscraper to Resume, by Charles V. Bagli, May 28, 2009.) but we were still wondering whether that was the real reason and the only reason that construction on the Beekman stopped when it did. In order for the Beekman to proceed, more bonds needed to be issued for the project. Those bonds could only be issued if they were backed by the bank providing its credit for the transaction. Might the bank have been reluctant at that point to further back FCR’s poor credit? In addition, the commercial real estate market in New York was way down so the value of the Beekman as an asset was probably unattractive additional security. It may not even be good for FCR’s balance sheet. (See: Manhattan real estate in freefall, by Edward Harrison on 22 February 2009.) So was the bank asserting its rights to withhold additional credit to the Ratner organization under the “material adverse change” clause, which the bank ought to have had in the documents whereby it would have been entitled to withhold the extension of credit for the issuance of additional bonds?

Abyss Dancing?

Forest City Ratner is still teetering but we noticed some strange coincidences as FCR danced near the abyss trying to scrounge up capital. Morningstar, (which had once called Forest City Enterprises stock worthless) on Thursday 05/14/09 raised the stocks fair value to $5.50 synchronously with the FCR’s filing of the Form 10-K filed after normal business hours (5:31pm) Wednesday 05/13/09 with the Securities and Exchange Corporation that set forth additional BAD news, and synchronously with FCR’s announcement that it was going to be selling more stock. (See: Thursday, May 14, 2009, Forest City Ratner mints money with new shares, stock declines only 16% coupled with Friday, May 15, 2009, Forest City warns SEC of potential new delays, new costs, and failure to meet (tax-exempt bond?) deadlines.)

Does it make sense for Morningstar to raise the value of the stock when additional bad news undermining the value of the FCR stock was coming out? Did Morningstar, in fact, know about the bad news that was going to come out almost contemporaneously with their upgrade action? We can imagine the dance that must have gone along with these events with someone at FCR probably doing some Morningstar hand-holding to steer things the way they wanted for the important date they would announce the sale of their stock.

We want to observe a coincidence of timing with respect to the following: On the Friday following the above described Wednesday/Thursday events, the Second Department ruled in favor of Forest City Ratner with respect to one of the pending lawsuits against the project. (See: Friday, May 15, 2009, Eminent domain case is dismissed unanimously; appeal in this and EIS case remain as last legal hurdles.) All we can say is, we found this very interesting.

Here is another thing we note. It was just days after FCR’s stock sale to infuse capital that the announcement was made (see above) that construction would resume at the Beekman.

Apparently at least $20 million of the stock being offered to infuse capital into FRC was bought by members of the Ratner family. That has us wondering too. (See: Wednesday, June 10, 2009, What should $20 million buy? How much walking-around money do FCE family members have?)

None of this dancing is likely to be sufficient, without more, to bring back Forest City Ratner from the abyss. Forest City Ratner wants the Atlantic Yards and it wants it on terms, in addition, where New York taxpayers bail it out.

A Change That Maybe Isn’t a Change: Was the FCR “Bait-and Switch to a Bailout” Contemplated From the Beginning?

Atlantic Yards was always designed as a meal ticket for Forest City Ratner paid for by New York taxpayers. We have always observed that the project looks less like urban design than like the perfectly designed sponge to collect the maximum possible public subsidy. Now people are waking up and they are commenting that they see now that there has been a “bait and switch.” (See: Sunday, June 21, 2009, DDDB breaks down the "bait and switch"; New York magazine critic seems to agree.) But the thing about this bait and is that the switch was always built in and part of the project from the outset.

The first thing to realize is that Atlantic Yards was never designed to deliver benefits to the public. That is one reason there was never any legitimate bid and a reason the site is not being built by multiple developers. The next thing is to realize just what was contemplated from the beginning. One can try to blame the proposed Forest City Ratner’s bailout on the economic downturn in the economy but that is not how it actually works.

To quote former ESDC head Marisa Lago, had we all along been speaking with what Ms. Lago has now dubbed “realism” (as opposed to the played-up “bait” version we got promoting the project) we would have admitted from the very beginning that the mega-monopoly being given to Ratner was such an enormously huge one, (Ms. Lago’s term: “transformational project”) that it would be a multi-decade project of perhaps 30 or even 40 years duration. (See: Wednesday, April 15, 2009, Permission to Speak Frankly: How We Know More and Less From Breakfast Interviews With Marisa Lago.) That means that the mega-development could never have been done in a single real estate cycle so encountering the “downturn” was virtually inevitable. So many years being involved also make it extremely questionable how much of the project 80-year-old Frank Gehry would ever have been around to design and supervise. Some bemoan Gehry’s loss: We don’t (his projects leak), but we do recognize how with Gehry’s departure it as been announced that what Forest City Ratner wants to deliver something truly “low-rent.”

What should be recognized is something we have been complaining about from the start: It is a completely backwards process to select the developer first, give them an exclusive monopoly over a swath of city and then negotiate the transaction with that anointed developer after the fact. Proceeding backwards deprives the public of any opportunity to exercise negotiating leverage and, as such, it must be presumed that just as a the downturn was foreseeable as virtually inevitable, the proposal for this bailout was foreseen and always intended.

In the End, For All To See

There is, however, a significant impediment to the inevitability of this proposed Forest City Ratner bailout going forward at public expense, a legal one at that. It has now become glaringly obvious that the proposed bailout shortchanges the public on each and every count. Any MTA and ESDC board member who votes to approve a bailout now will be casting a vote that is conspicuously a violation of their public trust. (No, voting as `instructed’ by the Governor is certainly not an acceptable excuse.) Each director’s vote involves an inescapably stark proposition since there is obviously one and only thing that stands unchanged by time: It is clear that a vote to approve “Atlantic Yards” means a vote to approve a deal for one sole remaining reason . . . because it is wired.

Répétez-vous après moi, s'il vous plaît: Plus Ça Change, (The More Things Change,) Plus Une Chose En Particulier Ne Change Pas: La Transaction Fixée (The Wired Deal)!

Still No Comment from Speaker Quinn or Any Other of 18 City Council Members Who Put Dock Street Through Committee Last Week

The amazing thing, or the absolutely not so amazing thing (depending upon how you look at this), is that none of the 18 City Council members responsible for approving the Dock Street in committee last week have yet been willing to comment on the School Construction Authority smoking gun e-mails respecting that project. Council members Gioia and Yassky had called for a halt to the project’s approval on the basis of those e-mails which apparently have no acceptable explanation other than that the School Construction Authority, coordinating with the upper ranks of the Bloomberg administration, were improperly manipulating and making false statements to get the project approved. The e-mails also point to a misdirection of public resources to that same end, putting a school where it would not be best to put it.

As noted in our last post on the subject, Noticing New York contacted the office of Speaker Quinn who whipped votes to get the project through for the Bloomberg administration and we contacted each and every Council member who voted in favor of the project last week in City Council committees and asked them for their comment on the School Construction Authority e-mails. So far we have no comment from any of them.

As we said, we would think that if Ms. Quinn is going to whip votes in favor of the Dock Street project she ought to have at least a comment on the smoking gun e-mails that have been in the press about the mayoral level manipulations to get the project approved and give the public less than the benefits it deserves. We also think that if any City Council committee member is going to vote in favor of the project and not to block it as Councilmen Gioia and Yassky said was essential, they should have a comment on these smoking gun e-mails.

Names and Votes of City Council Committee Members: (Again, Those Voting for Project Have Had No Comment)

Here are the votes of the two committees that voted on Dock Street on Thursday. City Council members on the Land Use committee who are also on the Zoning and Franchise committee are indicated in italics. (Everyone on the latter is on the former.) For extra good measure, we have bolded the names of any of Council members who also was among the 29 members who voted to extend the mayor’s term limits.

LAND USE COMMITTEE (17-4):

Tony Avella: no
Charles Barron: no
Eric Gioia: no
John Liu: no

Maria Baez: yes
Maria Arroyo: yes
Leroy Comrie: yes
Elizabeth Crowley: yes
Inez Dickens: yes
Simcha Felder: yes
Daniel Garodnick: yes
Sara Gonzalez: yes
Vincent Ignizio: yes
Robert Jackson: yes
Melinda Katz: yes
Jessica Lappin: yes
Annabel Palma: yes
Joel Rivera: yes
Larry Seabrook: yes
Helen Sears: yes
Albert Vann: yes

ZONING AND FRANCHISES SUBCOMMITTEE (6-2):

Tony Avella: no
Eric Gioa: no

Simcha Felder: yes
Robert Jackson: yes
Melinda Katz: yes
Joel Rivera: yes
Larry Seabrook: yes
Helen Sears: yes

We have some off-the-record and not-for-attribution comment from the offices we contacted that at least some of the Council members who voted for the project under Speaker Quinn’s direction did not feel Speaker Quinn was allowing them the freedom to vote their conscience and side, as would be expected, with Mr. Yassky, the local Council member in whose district the project is. There is also apparently some distress and thinking on the part of Council members who’s votes were whipped that Speaker Quinn would whip votes for the project and then not be willing to comment on the School Construction Authority e-mails.

See our prior posts for the statements of Council members Gioia, Yassky and Avella, all of whom oppose the project.

Prior Posts:

Sunday, June 7, 2009
A Lamda Night: City Political Candidates and Development (Focusing on Atlantic Yards and Dock Street)


Wednesday, June 3, 2009
What’s Up At Dock Street, Really?