Restaurants Lining The Gowanus Canal? It’s The Thought That Counts!

Looking at multiple new developments underway along Brooklyn's Gowanus Canal

You can’t help noticing all the development in Brooklyn’s Gowanus or everything that is being built that lines the once notoriously infamous Gowanus Canal. But before there was that development there had to be a rezoning to permit it, and, for that, there had to be a vision to boost that rezoning into reality.

And when that vision was offered, one thing that was touted was that the Gowanus Canal could become Brooklyn’s “Riverwalk,” the bustling area that helps identify San Antonio, Texas as a beckoning city with a distinctive destination that serves as a draw for tourists and everyone else.

Well, as they say, if your gonna “talk the talk” you gotta “walk the walk.” Which means if you're gonna do your Texas, San Antonio River-talk, you gotta do your Riverwalk too, for real, or sort of for real, or, at least as real as its gonna get in New York.

The scale of the San Antonio River along which you find Riverwalk’s 2 ½ mile 30 foot wide, boat-accommodating developed stretch is reasonably comparable to the Gowanus Canal’s similarly 100 foot wide, boat accommodating 1.8-mile length now being developed.  That’s probably why comparisons were generated.

But some things are different; not just the climate.

Riverwalk is promoted as having some of San Antonio's most spectacular hotels, night clubs, bars, shopping centers and businesses . . . and—

San Antonio’s Riverwalk is lined with more than a score of restaurants, two baker’s dozens is the higher number that approaches accuracy.

Riverwalk Restaurants promoted

So to “Riverwalk” the Gowanus you would think that the Gowanus would need a few restaurants, in fact to be similarly lined with restaurants– Wouldn’t you?

Well here’s the plan to bring the canal's "Riverwalk" up to snuff with San Antonio given the caveats that apply.

Gowanus Canal Restaurants: A Practical Plan

The caveats relate to the fact that Gowanus is a superfund site.  That phrase uses the word “super” in not a good or complimentary way.  For many memorable years the Gowanus waterway was famous for its noxious stench.  Maybe it immediately made people about the legends of the canal being used as a dumping ground for dead bodies by the likes of the mob.  But the putrid stink probably had more to do with the build up of healthy organism-slaying toxins from the years of industrial use and garbage dumping.

The original idea when the Gowanus Creek was transformed into a man-made canal was that a continual flow of water would cleanse and keep the whiff of rot from building up.  A ship’s propeller was installed at the head of the canal to pump water through a tunneled pipe from Buttermilk Channel, the tidal strait that is the span of water between Brooklyn and Governor’s Island.

The water became stagnant when that propeller soon broke and went unfixed for years.

A better flow of canal water?

With development of the canal in the offing, there have been fixes. In 1999 it was fixed and the direction of the tunnel's flow was reversed so that its water flows in from Buttermilk Channel, rather than the other way.  In 2014 the configuration was changed to three pumps in the Flushing Tunnel Pumping System replacing the propeller and increasing the flow.

But that’s not all that’s needed for relief from the effects of the canal’s toxic history.  The toxins are settled in the canal bed way down deep.  They are settled so deep that the thinking is that no  amount of dredging to remove them all is economically possible.  You can’t go deep enough.  The plan is to dredge and dredge somewhat deeply, and then cap the still toxic floor of the canal remaining with sand.

Of course there is some worry that with a huge hurricane, like the hurricane that Superstorm Sandy started out to be, the tumult would rip up and down below all the nice clean sand, stirring up and distributing what was laid down.  Sandy, which was reported to have had the lowest barometric pressure ever recorded for a North Atlantic storm brought in a storm surge wall of water from the harbor fourteen feet above what is normally ever the very highest.  Luckily, in some ways, it was all relatively serene as when Sandy actually arrived, its winds, a mere 17 miles an hour, weren’t anything comparable to a hurricane’s.

From Gothamist

No doubt, the dredging does good, but there is more than an economic price to be paid.  Last fall, the spirited Gowanus Dredgers Canoe Club Boathouse Jam crew was gathered to play its Blue Grass music sessions on the waterside promenade by the new, already built buildings alongside the canal.  (They gather Wednesday evenings April through October.)  At the same time, several hundred feet away a barge was there to do dredge work.  Not only was there conversation amongst the gathered musicians about how powerfully awful the smell being pulled up from under the shallow bottom was, there were expressions of sincere concern about how healthy it was to breathe and for how long.

Blue Grass jam: Gowanus Dredgers filling the air with spirited music where sometimes the air is filled with evil aromas.

Restaurants along the canal?  It’s not yet been zoned for restaurant.  And apparently the NYC Health Department has some objections and is not going to change its mind.

The answer?: A practical one. . .

Big television screens are going to be the answer.  Even if you are just a general consumer, really big television screens are now readily available- Even in 2019 you could get an LED screen 292 inches wide measured diagonally– In other words 24 feet.

Right now the biggest TV screen in the world is on the edge of the Las Vegas strip, in the Venetian Resort entertainment complex.  It’s 515 feet by 367 feet.     
 
What’s called for to serve the Gowanus is simpler.  The walk will be lined with screens that show you, full scale, the fronts of attractive restaurants.   A range of cuisines will be represented.

Motion detectors will detect when a passerby comes close to the projected door of any imaged restaurant.  At that point, a change in the computer-generated image will activate and a beckoning figure will come to the door of the restaurant.  It may be a sultry young woman with curves if you are a man (or we are mindfully told by city officials, if you “identify as one”), or an invitingly mysterious young man in a dark suit may appear if you are a woman.  That figure will hold out their hand to you with a scannable QR code in its palm . . .        

. . . scan the QR code with your phone and you will be supplied with a map and walking directions to go up the hill to a restaurant as depicted that will serve you a delicious meal on nearby Smith Street (two blocks away) or Court Street (three blocks away).     

A demonstration (to be held for city officials, restaurant chain executives, and members of New York’s key real estate families) of the prototype TV screens that will be used to accomplish the replication of San Antonio’s Riverwalk on Brooklyn’s Gowanus Canal is scheduled for today, April 1st, at one of the Gowanus Canal construction sites. 

Jane Jacobs Atlantic Yards Report Card #19: Avoidance of Harmful Large and Heavy Trucking Depots? MAYBE NOT?

This is evaluation item #18 (of 47) of the Jane Jacobs Atlantic Yards Report Card

Avoidance of Harmful Large and Heavy Trucking Depots? MAYBE NOT?

(Image from No Land Grab)

Jane Jacobs views trucking depots in the wrong areas as adverse to neighborhoods. Atlantic Yards is not proposing that trucking depots will be built within its final design. But there will likely be many years where construction trucks fill the neighborhood. This is because the Ratner organization’s operations are likely to go semi-idle whenever convenient for it or when it is seeking financing for the next phase or when waiting fo the next economic upturn. That is because the kind of arrangements that will apply to the Ratner organization on building the megadevelopment will not involve firm public-imposed and enforced deadlines for completion. It the site were bid out for development by multiple developers such deadlines would likely be imposed and they would be enforceable.

(Since this was originally written it has come out that the Forest City Ratner schedule will involve decades, perhaps 30-40 years.)

JJ Cites: [. . . . Visually, they are disorganizing to streets, and so dominating that it is hard- - sometimes impossible– for any countering sense of order to make much impression. P. 234]

The City to the Public: “We’ve Got Your Coney Island: If You Want It Back, Better Do Exactly As We Say. . ”

We were at “Which Way Coney Island? A Symposium on Its Future,” at New York University’s Arthur L. Carter Journalism Institute on Wednesday, April 29, 2009 where we heard some things about the way the city is telling its Coney Island story as it tries to eliminate a substantial amount of Coney’s amusement area through a rezoning. We also have suggested response to the city. Your letters need to be sent to the City Planning Commission.

A. Burden Opening: A Once-in-a-Lifetime Opportunity, This Administration, This Summer Only

Amanda M. Burden, the Chair of the New York City Planning Commission and Director of the Department of City Planning, made the first guest presentation. (BTW: While most of us might think of Ms. Burden as a linchpin in the Bloombergian development establishment, the city’s nyc.gov website says that Ms. Burden is an apparently self proclaimed “civic activist.” That has to leave people wondering what all the rest of us opposing Bloomberg style development are supposed to call ourselves?)

The city’s Coney Island rezoning proposal converts Coney Island amusement areas to commercial space and apartment buildings. Before Bloomberg maneuvered the City Council into overriding two voter referendums so as to grant him an extension of term limits, the city administration’s official spiel was that its Coney Island rezoning had to be passed this summer because a subsequent administration (Anthony Weiner’s?) would likely do something far more destructive. Now that conventional wisdom is predicting that Bloomberg will get his third term (if for no other reason than the lack of candidates running against him), the city has had to change its sales pitch. Ms. Burden offered the current version of the city’s new spiel.

Ms. Burden described the city plan for Coney Island as “a comprehensive plan” that “is really finely calibrated.” She then said (emphasis supplied):

And it can’t be done piecemeal. Next week City Planning will have its hearing on Coney Island. I hope people come and testify and recognize that this is a once-in-a-lifetime opportunity. Because another administration would never undertake this very, very complex plan. If it doesn’t succeed this summer this administration will never undertake it again. This is a once-in-a-lifetime opportunity and the only way for future generations to enjoy Coney Island forever and in perpetuity as the magic that it always was and can be and that will serve the neighborhood of Coney Island as an economic generator with housing for all people and jobs and a beachfront destination for the entire world.

Of course, the idea that “it can’t be done piecemeal”is eminently debatable. We think a gradual, steady building up of Coney based on current amusements is exactly what is called for. The notion that there can only be an all-or-nothing proposition simply serves to get the city off the hook in dealing with the urgency of taking the action that it can and should take now. For instance, the city owns Coney Island acres, mapped a s “parkland,” that for a long time it has allowed to be parking lot areas that detract rather than contribute to the Coney experience.

Ms. Burden seemed to be very nervous during her presentation and we noticed that she left immediately after finishing her remarks so that she was not available to engage with either the evening’s panelists or the audience afterward. Leaving, she turned things over to her deputy, Purnima Kapur, the Director of City Planning's Brooklyn Office.

Ms. Kapur: Identifying the Recent Accelerated Loss of Coney Amusements in the Last Four or Five Years and A Cause

Ms. Kapur spoke about the recent accelerating loss of Coney Island amusements in the last four or five years. Interestingly she did so without identifying what we think has been its obvious cause, something about which she also spoke without making a connection between the two.

Here is Ms. Kapur on the accelerating decline of Coney Island amusements in the last four or five years (emphasis supplied):

But as we started to look at the history of this amusement area, what we realized is how much it has declined from its heyday which was about a century ago when there were three active vibrant amusement parks in the vicinity of each other. Over the years through the course of the 20th century* and then going into the 1970s** gradually these amusement parks have been disappearing. That pace of disinvestment and loss of amusements has accelerated really deeply in the last four or five years with speculative land transactions that have gone on. Last fall the last remaining large amusement park called Astroland was shut down and today when you go to Coney Island there is less than three acres of active amusements, Deno’s Wonder Park which has the Wonder Wheel is the last remaining park to remain there with some uses along Surf Avenue and Mermaid Avenue.

(* This was when Robert Moses replaced many acres of active amusements and associated jobs with housing occupied by people in need of jobs. ** This was when the city took title to active amusement area land that had formerly been Steeplechase Park, turned it into “parkland” theoretically to ensure future amusement area use and then never followed through in using that land for amusements even though they kicked out the amusements that were there.)

Here is Ms. Kapur on that which exactly coincided with that accelerating decline during the last four or five years: The launching of the city plan to supposedly “save” Coney Island amusements (emphasis supplied):

This is a plan that is an interagency effort. Many city agencies under the leadership of the Department of City Planning and the Economic Development Corporation have been working a long time to develop this plan. It started about five years ago with the formation of the Coney Island Development Corporation and the mayor’s strategic plan that was issued for Coney Island. Since that time the city and its partners have been engaged in a very intensive outreach at the community level to local stakeholders, with property owners, with amusement operators and the plan that I am going to present today is the result of that intensive outreach.

We don’t think it could be more obvious that the real estate speculation blamed for the recent accelerating destruction of Coney Amusements began with the launching of the mayor’s strategic plan and the “outreach” to property owners about the planed rezoning and reduction of amusement acreage.

Kapur on Leadership of Her Agency City Planning and EDC

The last above quote from Ms. Kapur is valuable for what we intend to discuss in a minute: She talks specifically about how the mayor’s strategic plan is an “interagency effort” of "many city agencies under the leadership of" her agency “the Department of City Planning and the Economic Development Corporation.”

In a moment we will see how Ms. Kapur seems to disavow that “leadership” when pressed by fellow panelist, Dick D. Zigun of the Coney Island Side Show (with a little help from a question we asked).

Dick Zigun: Why Won’t the City Take Obvious Actions To Help Coney?

Our ears perked up when, during his presentation, Dick Zigun asked about the way the city was NOT doing things it could be doing to send critical signals about the city’s commitment to a long-term preservation of an iconic Coney Island:

To the City: While you are dealing with Thor [Thor Equities a developer/land speculator], Yes, you are making little changes and we appreciate that. But. . . Where is Amanda [Amanda Burden, Ms. Kapur’s boss, who we noted earlier left, leaving Ms. Kapur in charge.]? There are some substantial things that infuriate us that you are not doing.

OK: So, on your slides you show us the Shore Theater and you talk about how important an icon that is. Now, you know my organization spent the money, hired the consultant, did the application to Landmarks Commission where it is sitting and sitting and sitting. And all it needs is a phone call from Amanda or from [City Councilman] Dominic Recchia to get it calendared at the Landmarks Commission and that has not happened.

You show slides and talk about how important Nathan’s is and yet your own plan upgrades the Nathan’s property to fifteen stories and in your environmental impact statement you concede that, although you are not calling for the demolition of Nathan’s, there is a cause-and-effect relationship between the value and taxation of real estate and your own study says that in ten years Nathan’s Restaurant is likely to be demolished and replaced by a theme Nathan’s in a fifteen-story building when all you have to do is call for fifteen stories on that property with a setback of two stories on Surf Avenue, and yet you have not done that! Why aren’t you doing these things? It would mean a great deal to us.

It would not only mean a great deal to Dick Zigun and company, it would tell everyone else in the city that preserving historic Coney is a priority. Envisioning the destruction of Nathan’s as the city plan currently does (even if it does not call for it) sends the opposite message. (See: January 22, 2009, Dog gone? Nathan’s could be victim of Coney success, by Mike McLaughlin, The Brooklyn Paper.)

Our Question Follows Up About Whether the City Really Sees Saving Coney As Urgent When the time came for the audience to ask questions we thought back to what Mr. Zigun had said about what the city was not doing to save Coney Island and we questioned the city’s real sense of urgency. All of the factions . . . the city, land speculator Thor Equities, Taconic Development, the Municipal Art Society. . . have adopted the amusement community’s theme and language about saving a vibrant, iconic, edgy, open, accessible amusement district. Therefore with the same language being used, it becomes a question of looking beyond words to see what people are actually doing and spotting the real differences in the several proposals. Here is what we (MDDW) asked, which generated a long, and we think telling, exchange between Mr. Zigun (DZ) and Ms. Kapur (PK):

MDDW: I am looking for the real differences because I notice that there is a tendency for everyone to adopt very similar sounding rhetoric about the amusement areas. So the real differences are that the Municipal Art Society is proposing the largest amusement area. Why, in terms of real differences. . . I understand that the city is proposing temporary things this summer, but with all this urgency when we say that it has to be “this administration and this summer,” why can’t we have urgency about some of the permanent things: So the questions that were asked about the Shore theater and having Landmarks act now: respecting the preservation of Nathan’s, why can’t there be an urgency about acting to do those things? Otherwise it sounds like a threat, this business of: “this administration,” “this summer,” right now!

PK: I cannot speak for the Landmarks Commission about the urgency for landmarking the Shore Theater as it currently is built, is built to a higher FAR than we currently are rezoning the area for, so there is no incentive for it to be torn down.

DZ: But why don’t you make the phone call that I’m asking for?

PK: I wish I could simply just make these phone calls.

DZ: You can. You can. You are the city!

PK: I think you give me credit for more power than I have.*

DZ: Amanda can’t? If Amanda can’t, the mayor can.

PK: I think that our plan lays out the importance of all of these things and retaining them in this area. We will let the Landmarks Commission make the decision about its landmark’s eligibility.

(*Ms. Kapur seemed rather upset at this point.)

(Image of Shore Theater above from Coney Island USA at ConeyIsland.com)

We Interrupt This Exchange To Bring In Landmarks Commission Chairman Tierney

The above exchange continues further, particularly about Nathan’s, and we will return to it momentarily. First, we want to switch to a follow-up by interjecting a relevant exchange we had with Landmarks Preservation Commission Chairman Robert B. Tierney last week when we attended the recording of the WNYC special “The Places That Bind” with Rosie Perez, in which Mr. Tierney participated as a panel guest.

The Places That Bind, which is about the stresses our communities are under from development, will be broadcast:

Saturday, May 16: 7am on 93.9FM
Sunday, May 17: 9pm on Am 820

We recommend you tune in. We will discuss the show further after it is broadcast. After the show was recorded, we had a chance to ask Commissioner Tierney (RT) a question we (MDDW) were unable to ask during the show. Here is our exchange (emphasis supplied):

MDDW: When a neighborhood has goals for preserving its heritage, to what extent does the Landmarks Preservation Commission coordinate with other agencies like City Planning and the Mayor’s Office?

RT: A lot. Always. Definitely, work all the time with Amanda Burden. I work with CAU, I work with who handles the community assistance unit, with the community boards. We get very. . . We have our own community meetings where we have not only elected officials but other parts of city government. We are working with them all the time.

MDDW: In this regard, if the Coney Island heritage is important to the city, and City Planning acted on it. . . had a hearing on it yesterday . .

RT: Right.

MDDW: Why hasn’t Landmarks moved to preserve the Shore Hotel? [correction Shore Theater.*]

RT: The Shore Hotel is on our list. We are looking at it.

(* A possible very desirable adaptive reuse that people hope will be considered for the Shore Theater is as a boutique hotel.)

Ergo it seems odd that although Ms. Kapur says that her agency is leading a many-city-agency “interagency effort” and although Chairman Tierney says that he “Definitely” works “all the time with Amanda Burden,” Ms. Kapur says that somehow Ms. Burden or the mayor can’t make a phone call to stress to the Landmarks Preservation Commission the importance the landmarking of the iconic Shore Theater has to the future of Coney Island as an amusement area.

Back to the Zigun/Kapur Exchange

Here, picking up from where we left off, is the rest of the Zigun/Kapur Exchange. We think that Mr. Zigan scores more points, but we let you evaluate for yourself the ways in which Ms. Kapur justifies the city’s inaction with respect to preserving Coney Island icons:

PK: I think that our plan lays out the importance of all of these things and retaining them in this area. We will let the Landmarks Commission make the decision about its landmark’s eligibility. As far as Nathan’s is concerned, Nathan’s is owned by Nathan’s. This is not a property that, you know, if we rezoned, they have reason to uproot themselves and go somewhere. They have been in the neighborhood for a very, very long time. There’s a business, you know, incentive to keep them there. And we do have setbacks actually, on Surf Avenue, which, you know, with your sort of encouragement and assistance we have brought down to forty feet on Surf Avenue.

DZ: Point of clarification, . . .

PK May I finish first?

DZ: Let’s just stick with Nathan’s: It’s owned by the Handwerker family and leased to Nathan’s, and your own impact statement says you are creating an environment, an economic condition that ultimately will lead to the demolition of a two-story building.

PK: That is not what our EIS [Environmental Impact Statement] says. What our EIS says is that there is a development potential to actually add to the Nathan’s building. There is nothing saying that Nathan’s should be demolished. The property that Nathan’s owns actually extends deep into the block and there is nothing stopping them from building additional buildings that set back from Surf Avenue. It doesn’t say that you have to demolish Nathan’s to actually make it.

DZ: No, but there is an economic encouragement that will ultimately lead to that.

PK: I don’t believe so.

DZ: Why don’t you offer a setback on that one particular piece of property?

PK: Calling for . . ., unless that is a landmarked building, calling for that setback there doesn’t make any planning sense.

DZ: But it makes sense as to what Coney Island is about and saving another icon. Like the Cyclone, like the Wonderwheel, Nathan’s is important.

PK: We totally agree with that and think that Nathan’s is financially viable and the owner of their own business and we hope, you know, our anticipation is that it will continue to be there.

DZ: It is NOT owner-occupied. The Handwerker family owns it and leases it to the corporation which is no longer their business.

PK: But this is their flagship store. This is where Nathan’s started. They have a business incentive to keep it as business owners.

Entrusting Coney’s Future to the City: In the End Doesn’t it Lead to The End of Coney?

(Image of Nathan's from Brooklyn Paper story. NNY's Image of Astroland rocket below.)


The city is asking us to entrust Coney Island and its future to their plan, a plan that involves hacking away at Coney’s amusement area acreage for more Bloombergian real estate development. We find ourselves feeling rather like we have received a ransom note after a kidnaping. We are being told we have to approve the turning over of more acreage for Bloombergian-style real estate development if we ever want to see our beloved Coney Island in good health again. We even find ourselves wondering if Coney’s severed body parts, like the Astroland rocket, will wind up being returned to us piecemeal. We don’t trust the kidnappers who created the jeopardy in the first place. Jeopardy began with the introduction of the mayor’s “strategic plan” and his administration’s “outreach” to property owners. That, we believe, led quite clearly to the sudden wave of real estate speculation. After that, there is little disagreement: Everyone attributes the recent accelerated decline of the Coney Island amusements to that speculation.

With kidnappers you frantically try to discern evidence fo good faith, desperately hoping that you will find it, but we don’t see any real evidence of good faith on the city’s part. The city already holds “parkland” that was supposed to be used for amusement area, but the city uses it as parking lots. The city doesn’t act to preserve iconic sites at Coney; it only holds them hostage, perhaps never to be released. All we seem to know for sure is that the city wants commercial real estate development. The bargain the city proposes that amusement areas be shrunk as acres are peeled off for other uses is one that has never before worked for Coney’s good health or the preservation of the amusement areas. And though it hasn’t worked before, the city says: “Trust us.” Many kidnapings wind up unhappily. The ransom is paid and the kidnapped does not survive. That is our fear here.

Still Possible to Send Written Testimony to City Planning Commission

The City Planning Commission is still taking written testimony on its proposed Coney Island plan; testimony should be submitted soon. (May 18, 2009 is the deadline if it relates to the Draft Environmental Impact Statement though other testimony can be submitted later.) See their hearing procedure notice for instructions.

The City Planning Commission needs to be told that there are certain minimum alterations that need to be made to their plan for the Coney Island we know and love to survive. For a list of the minimum revisions that should be made to the city’s proposed plan, reflecting what is recommended by the amusement community and its ally, the Municipal Art Society, see: Monday, April 20, 2009, All Eyes Are On. . . . Coney Island.

We suggest you send your own note in response to the ransom note we have received from the Bloomberg administration and that you demand that those specific listed changes, at a minimum, must be made, because we demand that our Coney Island be returned to us alive and healthy.

The Great Recession: A Stimulus to Get Our City Back to “Bidness?”

Listening to a report tonight on NPR’s All Things Considered about how the federal stimulus bill was affecting the construction industry we heard the following:

With private capital all but dried up many contractors who normally work on private construction projects are now bidding on the public sector jobs funded by the stimulus. One benefit of so many contractors seeking the work is that bids for stimulus construction projects are coming in below expectations, meaning that there may be more money available to fund more projects later on.

(Listen to: The Stimulus Bill And Construction, by David Schaper: at 2:30)

We have also heard Forest City Ratner’s explanation for why it is stopping work on its Beekman project near City Hall: That it wants to similarly take advantage of the current economic climate by rebidding the construction work “with contractors eager for work.” (See: Monday, March 30, 2009, Forest City Enterprises announces losses, asserts that AY arena is one of only two new projects to launch in 2009.) (We suspect that something else is actually preventing the Beekman from proceeding at this time. . . Might it not have to do with the way Forest City Ratner’s financials and credit rating are tubing, added to the way that NYC commercial real estate assets like the Beekman are not underwriting the way they did nine months ago?)

So state and local governments everywhere else are saving significant money on public sector work by getting bids during this economic downturn, and Forest City Ratner claims it is similarly going to reduce costs for itself through the lower bids they can get during the economic downturn. . . Who isn’t invited to the party to get the benefits of such bidding? The New York taxpayers who are expected to shoulder the unbelievably huge subsidies (more than $2.1 billion) being given to Forest City Ratner, without bid, for its proposed Atlantic Yards project! That is because, our politicians gave Ratner (without any bid) a multi-decade monopoly on a 22-acre site which, in theory, precludes competition for perhaps 40 years.

Are our politicians really telling us with straight faces that they have made a deal with Ratner that precludes any competition for however many decades it takes his company to complete Atlantic Yards? Are they saying that the public can’t even give project work to competing developers if Ratner dawdles for decades, goes bankrupt or reneges on what was once promised for delivery?

We have always advocated that development on the scale of Atlantic Yards should be done the way that other large developments are and should be done, using the same model as Battery Park City and Queens West: The project should be bid out, as ready, in multiple parcels to developers who actually commit themselves to specified results in the near term. If our advice were being followed some development in the area might be complete by now. More important, however, nobody would be arguing that whatever development wasn’t already underway couldn’t be bid out to take advantage of the substantial savings the public could now be achieving.

Jane Jacobs Atlantic Yards Report Card #17: Avoidance of Harmful Parking Lots? NO

This is evaluation item #17 (of 47) of the Jane Jacobs Atlantic Yards Report Card

Avoidance of Harmful Parking Lots? NO


(Picture: Rendering by the Municipal Art Society- for its Atlantic Lots- showing the teardown of the neighborhood the project plan involves -Original Aerial Photograph by Jonathan Barkey.)

Jane Jacobs viewed parking lots as negatives for cities from two standpoints. In a neighborhood, she viewed them as dominating and disorganizing. More generally she viewed high levels of cars being a net subtraction from the benefits of city life and she viewed accommodations of cars that encouraged their use as promoting a vicious cycle which erodes the balance of pedestrian activity in favor of vehicular activity. Plans for Atlantic Yards involve a hurried rush to create parking lots, in some cases demolishing historic buildings. It can readily be alleged that the reason behind the hurry is to remove the demolished buildings from the public’s consciousness together with the possible ingredients for an alternative future. The parking lots that replace them may be in place for twenty to thirty years. If parking lots are in place long enough people will be inclined to judge the Ratner buildings by a lower standard,- - whether they are improvement over a parking lot. Twenty years of parking lot can be a long time. If one is old enough, it could be a good portion of one’s remaining life.

JJ Cites: [ . . . Visually, they are disorganizing to streets, and so dominating that it is hard- - sometimes impossible– for any countering sense of order to make much impression. P. 234 The problem is how to cut down drastically the absolute number of vehicles using a city. P. 345 Erosion of cities by automobiles entails so familiar a series of events that these hardly need describing, The erosion proceeds as a kind of nibbling, small nibble at first, but eventually hefty bites. . . . More and more land goes into parking to accommodate the ever increasing number of vehicles while they are idle. No one step in this process is, in itself, crucial. But cumulatively the effect is enormous. P.349 the more space that is provided cars in cities, the greater becomes the need for use of cars, and hence for still more space for them. P. 351 all this duplicate parking lies idle for much of the time. P. 356 Attrition of automobiles operates by making conditions less convenient for cars. Attrition as a steady, gradual process . . would steadily decrease the number of persons using private automobiles in a city. P. 363]


(Picture: Rendering by the Municipal Art Society showing the teardown of the neighborhood the project plan involves -Original Aerial Photograph by Jonathan Barkey.)

Reject the “Bundle” Bungle: Saying “No” to Walentas Dock Street Project Next to the Brooklyn Bridge

Here is Noticing New York’s Testimony presented last week at the Brooklyn Borough President’s hearing on the proposed Walentas Dock Street DUMBO project next to the Brooklyn Bridge.


Noticing New York’s Testimony

* * * *

January 27, 2009


Hon. Marty Markowitz
Brooklyn Borough President
Borough Hall
209 Joralemon Street & Court Street
Brooklyn, New York 11201

Re: Today’s hearing on 18-story Dock Street DUMBO Project just east of the Brooklyn Bridge

Dear Borough President:

This testimony is presented in the name of Noticing New York, which addresses itself to issues of what is good public policy and planning critical to New York development issues.

Rather than address the particular merits of the project, its proposed size or the merits of building the proposed school, our testimony addresses the public policy wisdom of bundling choices together, what the New York Times referred to as “a Faustian bargain,” approving a school if a developer is allowed to build a project of extra height.

1. Why not consider the school and the project as separate decisions? The Walentases are good and capable developers, some of the best in the city. Surely they can build a project that would pass muster without the tacked-on enticement of a school.

2. Is there wisdom to the bundling of these decisions? Does the bundling enhance each choice or just cause each choice to be suspect? Shouldn’t we now ask, if the building is a good size, shape and height, if it has to be “sold” to the public by incorporating a school? Is the school really good planning or the one that the public actually wants if it is being tacked-on to “sell” a project of a likely unwanted size, shape and height?

3. Involving school construction in these bundled decisions seems to be popular these days. Not only do we see it here; it was also done on the other side of the Brooklyn Bridge with the Beekman project. There we saw that the tactic backfired and the public was hurt when, with construction underway, the developer, Forest City Ratner, blackmailed the public and the community board for extra subsidy. Though it is not, per se, the same kind of bundle, the Rudin development organization is offering to help build a school at the same time it is seeking approvals to eliminate a portion of the Greenwich Village Historic District to build an extra-large, extra-dense development. (These “Faustian bargains” tend to be about giving developers the right to build extra density.)

4. Bundling of decisions puts too much power in the hands of those who bundle the choices and creates questionable equations which cannot necessarily be defended. The Brooklyn Bridge Park is another example of such bundling. To say that a park should be expected to pay for itself does not mean that such a newly invented equation makes sense, merely that it is being proposed as a take-it-or-leave-it proposition.

5. When we shop for computers we don’t like our software bundled. We prefer to get the programs we truly want. But if you buy your software programs bundled the worst thing that happens is that you waste hard drive space. Hard drives get ever-larger and you can always migrate to larger ones. But with the decisions that involve how the public realm is dealt with, there is a limited amount of density that can be squeezed in. Corrections are not possible afterward.

6. Accordingly we urge you to consider that the “bundle” may instead be a “bungle” and let the public make its decisions, as they should be made, separately.

Sincerely,



Michael D. D. White

* * * *

Some Background on the Brooklyn Bridge No Longer Being Background to DUMBO

A lot of people have the idea that the proposed new Dock Street project, which can only happen if a zoning variance is granted, is too massive to be placed, as proposed, so close to the Brooklyn Bridge. By one report, three-quarters of those attending the hearing testified against the project. (See: Full House at Dock Street DUMBO Hearing.) Though we testified at the hearing we did not attend it in its entirety. From what we were able to discern, more of that testimony that favored the project was by those who showed up early and the later testimony was increasingly weighted against the project.

Previously Rejected, Sugar Grows a Preciously Rejected Project

As testimony at the hearing indicated, the project is an enlarged variant of a project that was rejected by Community Board 2 about two years ago for being too large. The odd thing is that, although it is now larger, Community Board 2 voted 30-7 to approve this enlarged edition. It was the apparent sweetening addition of the school that makes the now 18-story development acceptable when the previous 16-story incarnation was not. (The new proposed school would occupy one story of the new version of the project.)

The New York Times article which we quoted as describing the school as a “Faustian bargain” in our testimony is: Wondering if a New School in Brooklyn Is Worth Blocking the View, by Christine Haughney, January 20, 2009.

Dashing the Dish Idea

The general view of those opposing the project is that the Brooklyn Bridge is a special architecturally beautiful landmark, the view of which should be preserved. The view is perhaps especially important to maintain on the Brooklyn side of the bridge. The thinking is that the Brooklyn tower of the bridge should essentially be visible in the middle of a dish shape cityscape with buildings rising taller as they retreat further away from the bridge. Sounds like a plan! Right now, the current zoning restricting heights surrounding the bridge is consistent with preserving view lines in this way. Sounds like a plan implemented.

The proposed Walentas Dock Street building rises up as a tower close to the bridge in a way that is inconsistent with that plan or the preservation of sight line views of the bridge. Sounds like spot zoning. That’s something a lot of people testifying at the hearing said.

Brooklyn Bridge: Exceptionably Special

We hold the following to be self-evident: Not all bridges are created equal. Elsewhere in New York, for another bridge, Noticing New York might take the position that tall buildings should be encouraged next to the busy footings in areas where other bridges touch down; for instance the area east of Bloomingdale’s where the 59th Street Queensboro Bridge touches down in Manhattan. But we agree that the stone towers of the Brooklyn Bridge, celebrated like no other in the city and representing a momentous change in the Borough’s relationship with the rest of the city, is an extraordinary viewing experience that ought to be preserved. It opened in 1883 as the longest suspension bridge in the world and a few short years later, in 1898, the City of Brooklyn consolidated to become part of the rest of the city.

But the Developer Should Not Be Made Special

Our opposition to the project is not NIMBYism. It is more about process and procedure with a mind to what bad process and procedure lead to overall. The proposed Walentas building, itself, does not seem to be that much more of an imposition than we as New Yorkers are often asked to bear for various reasons. But the only reason we are being asked to bear this particular imposition is in order to specially benefit a particular developer in a way that is not envisioned we would want to accommodate other developers in the same area. . .

. . . The project alone does not completely block out all views of the Brooklyn Bridge but the experience it creates, if replicated by other adjacent buildings receiving equal treatment, would entirely change our relationship with the bridge. Rather than having elected to uphold the bridge in a position of respect we would be relegated to catching mere glimpses of it between the blotting-out expanse of large new buildings.

School Construction Authority Out of Line On School?

That is were the question bundling the school into the building comes up.

The School Construction Authority has acted to tilt things in favor of the development. It “signaled its support for the Walentas project, by putting the school on its property list even before it’s officially approved by the city.” (See: December 11, 2008, Walentas ready to ‘Dock’ with 18-story tower, by Sarah Portlock, The Brooklyn Paper.) Previously, before this was part of a proposal to bundle benefits so a developer could build bigger, the School Construction Authority was not in favor of providing a school:

For too long, the School Construction Authority argued that a new middle school was not needed in Brooklyn Heights or DUMBO because the city had excess middle school seats district-wide.

(See: January 29, 2009, Editorial: Yes on Dock Street, The Brooklyn Paper.)

Materializing as a seeming bribe to the community, the timing of School Construction Authority’s actions are especially unhelpful to the integrity of the process. Those actions bear examination.

Brooklyn Heights Association’s Commitment to Schools

We put great stock in what the Brooklyn Heights Association has to say about schools because for years they have been deeply involved in focusing on just what is needed in the neighborhood in terms of schools. They have been involved with the fight for good and appropriate schools since long before it was proposed to bundle a school into this project as a sweetener. Their testimony, presented by several coordinating representatives, covered a number of separate aspects concerning whether the project should be approved. The Brooklyn Heights association opposes putting the bundled school in the project as inferior to more desirable alternatives.

We think the Brooklyn Heights Association’s position is more sincere, neutral, informed and consistent than those who would favor the project because of the school, including the School Construction Authority.

Brooklyn Papers Editorial Position

We note that we often place much stock in the reporting and positions of the Brooklyn Paper and that the Brooklyn Paper is editorially supporting Dock Street (see the link above). We also note that those opposing the project have pointed out that the Brooklyn Paper is a tenant of the developer.

For more information and links to other reporting on the subject, go to the site of the DUMBO Neighborhood Association.

The Good News IS the Bad News: Thanks A lot for Mayor Bloomberg’s “Charity” (Part II)

(Mayor Bloomberg above listening to public testimony about the term limits extension bill he signed immediately afterward.)

This is Part II of an article about why Mayor Michael Bloomberg’s contributions to charities from his ever-increasing wealth is bad news. The first part of this article (Click here) examines how Bloomberg uses “charitable” donations in an abusive conflict-of-interest way. This Part II of the article was necessary to address at length the important related concerns about high-level conflicts of interest in the Bloomberg administration.

We left off in Part I asking:

How separate are the worlds of big mega-deal city administration-assisted real estate development and the Bloomberg private-wealth businesses that are growing so fast? Perhaps the first and best clue would be how responsibilities divide up when Bloomberg puts his senior confidants in charge of these worlds. It turns out that at the very top of the Bloomberg administration there is a troubling lack of separation and all sorts of problems with conflicts. Let’s talk about two of Bloomberg’s top administration officials, two deputy mayors with key city real estate development responsibilities, Daniel Doctoroff and Patricia Harris. The latter, Ms. Harris is also key when it comes to Bloomberg’s charities, both dispensing them and collecting charitable donations from New York developers who are receiving city largess. Of course, Bloomberg’s own conflicts deserve further discussion too.

Doctoroff of Development: His Continuing Deputization by the Mayor

The person who was for most of Bloomberg’s administration the deputy director of development, charged with overall responsibility for the city’s mega-deal administration-assisted real estate development was Daniel Doctoroff. Daniel Doctoroff left that position relatively recently (the last day of December 2007) and when he left he became the President of Bloomberg L.P., the mayor's media corporation. That in itself may indicate insufficient separation, but Doctoroff wanted to keep working on the major city-assisted deals even when he was President of Bloomberg L.P..

Doctoroff went to the city Conflicts of Interest Board to get approval to do so. Megaprojects take decades to bring to fruition and at the times that Doctoroff went to the Conflicts of Interest Board the Bloomberg administration was destined to wrap up the end of 2009. It is doubtful that mention was made to the Conflicts of Interest Board that in less than a year the Bloomberg administration would ram through an extension of term limits in order to procure four more years in office. The Conflicts of Interest Board approved Doctoroff’s request despite the fact that Doctoroff would thereby be in a position where he was simultaneously dealing on the public’s behalf with the same developers of multi-billion dollar real estate projects and negotiating with these same developers as a private businessman (See: No Conflicts Over Doctoroff's Dealings, By Dave Hogarty in News on December 23, 2007)

Doctoroff’s continuing involvement involves some of the city’s highest-dollar volume deals. According to the Observer, Doctoroff said he:

wanted to continue on as chairman of the Hudson Yards Development Corporation—the agency that is involved in rezoning the West Side and finding a developer for the rail yards—and remain involved in the Moynihan Station proposal, Hunters Point South and congestion pricing.

(See: Doctoroff Wants to Stay Involved with Hudson Yards, Moynihan, by Matthew Schuerman, December 6, 2007)

One Clear Example of Doctoroff Conflict

The Gothamist article above points out that even though the Conflicts of Interest Board cited “extraordinary circumstances” to say that “Doctoroff's negotiations on behalf of the city with Vornado Realty Trust regarding the development of the Hudson Yards and Moynihan station were allowable,” that Bloomberg L.P.. of which Doctoroff will be president and chairman of the management committee:

will be negotiating with Vornado for additional space at the building that houses Bloomberg LP's headquarters on Lexington Ave., since Vornado owns that building. The Conflicts of Interest Board gave its blessing on the condition that Doctoroff have no direct dealings with Vornado for a year after he leaves his position as Deputy Mayor.

That is just one example of a problem, based on just one project. The Conflicts of Interest Board ruling also applies to“other city projects including the redevelopment of Governors Island, PlaNYC, and Queens West.” (See: Doctoroff Cleared to Continue Work on Moynihan Station, 2008-03-26.)

The five member Conflicts of Interest Board which considered that “extraordinary circumstances” presented themselves is made up of mayoral appointees.

An Example of How Confusing Doctoroff Conflicts Can Be, With Distinctions Not Made and Distinctions Not Observed

Adding to confusion, having issued “a waiver” in December 2007, the board followed up with a ten-page Ex-Official Cleared to Continue Work on Big City Projects, by Patrick McGeehan and Ray Rivera, March 26, 2008.)

Here is just some of what the Times wrote in that article pointing out aspects of the confusion:

The board’s decision underscores a reality that has often been noted in the city’s development community: Mr. Doctoroff may have left City Hall, but he remains a participant in — and has a big influence over — what is going to be built.

* * * *

It is not unprecedented for former city officials to be involved with public projects, but in the case of Mr. Doctoroff, the city’s longest-serving deputy mayor for economic development, the list is so long and varied that city officials and even some who serve on boards with him have expressed confusion about his roles. In response, City Hall circulated a memo in January advising city employees how to interact with him.

For a year after leaving public service, former officials are strictly prohibited from appearing before any city agency within the branch of government where they served; the ban is even longer if the subject is one in which the official was directly involved. The prohibitions do not apply, however, if the official is appearing on behalf of the mayor or another government agency.

Some questions about Mr. Doctoroff’s future role remain unanswered.

The board’s 10-page opinion did not address his participation in development decisions about the West Side railyards, known as Hudson Yards, although the city had asked for a ruling on the matter.

* * * *

On Wednesday, the transportation authority is expected to grant development rights over the railyards, a 26-acre slice of Manhattan overlooking the Hudson River, to Tishman Speyer, one of Manhattan’s largest real estate operators.

Mr. Doctoroff met during the week of March 10 with the teams of developers competing for the billion-dollar project, according to members of the teams, who spoke on the condition of anonymity because they did not want to offend Mr. Doctoroff.

Even after he left later on a business trip to Asia, Mr. Doctoroff remained in constant contact with the selection committee throughout the deliberations.

. . . . Mr. Doctoroff dismissed the notion that there might be a conflict of interest between his continuing work for the city and his new role at Bloomberg.

“Certainly, if I felt it was going to create conflict that I thought was going to be harmful to the company, I wouldn’t do it, and I’d be the same way with the city,” he said. “If there was a conflict, I just wouldn’t do it.”

At the time of that Feb. 22 interview, Mr. Doctoroff also insisted that his involvement with the city had been limited since leaving office. . . . That did not include the recent railyard negotiations.

* * * *

The opinion issued on Tuesday limits the role he can play in matters involving Vornado Realty, which owns the building housing the Bloomberg L.P. headquarters. The company is negotiating with Vornado for additional space.

The board said that given Mr. Doctoroff’s knowledge, it was best for the city for Mr. Doctoroff to continue his involvement with the Moynihan Station plans. Vornado is a developer of the station project and was one of the companies vying to develop the railyards with whom Mr. Doctoroff met earlier this month. On March 12, Mr. Doctoroff met with the Vornado chairman, Steven Roth, and the M.T.A. selection panel, and last Friday with David Greenbaum, a top Vornado executive.

The opinion advises Mr. Doctoroff to recuse himself from any discussions between Bloomberg L.P. and Vornado for one year from the date of the conclusion of the Moynihan Station negotiations, and from all dealings involving Vornado or Bloomberg L.P. in any of the other projects addressed in the ruling.

Gene Russianoff, a senior lawyer for the New York Public Interest Research Group, said he agreed with much of the ruling but was troubled by the absence of the railyards and the station exception.

“I can see recusing himself from landlord-tenant matters with Vornado, but is Vornado going to say, ‘O.K., we’re going to jack up the rent when we’re trying to make some kind of deal over Moynihan,’ ” Mr. Russianoff said.

We have set forth the above at substantial length because it is so valuable; it is worth reading the entire Times article carefully to appreciate how much more confusion of roles is involved in the Doctoroff situation.

Recusal, Refusal and Confusal

As good as it is, the above Times article did not mention yet another level of complication. Before Doctoroff officially left City Hall, he was responsible for matters from which his boss, Mr. Bloomberg was supposed to recuse himself because of conflicts of interest respecting Bloomberg, L.P. Doctoroff’s being at Bloomberg L.P. invokes those same conflicts and the need for Doctoroff also to recuse himself personally. (The Roles Blur for the Mayor and the Mogul, By Serge F. Kovaleski and Ray Rivera, December 8, 2007.) Who then is anyone reporting to and who in the chain of command doesn’t have a conflict of interest? That, in a moment, will bring us to Deputy Mayor Patricia Harris.

The Times reported on how, while Doctoroff was Deputy Mayor for Development, he had been officially charged with negotiations from which Bloomberg was required to recuse himself, but that: 1.) Bloomberg failed to effectively recuse himself, and 2.) people were skeptical about whether delegation to Doctoroff was, in any event, a sincere attempt by Mr. Bloomberg to recuse himself:

When the city began negotiating with Verizon on its bid for a cable franchise, Mr. Bloomberg, whose company, Bloomberg L.P., owns a business news channel, stepped aside and put Mr. Doctoroff in charge of the talks.

When Merrill Lynch, which owns 20 percent of Bloomberg L.P., was considering leaving Lower Manhattan and moving to Midtown, Mr. Bloomberg limited his involvement in negotiations. He let Mr. Doctoroff handle them.

The Bloomberg administration said these steps were intended to protect the mayor from any appearance of a conflict of interest. But other people were skeptical of the arrangement, given the close relationship between Mr. Doctoroff and Mr. Bloomberg.

The Times observed the following in relation to the Mayor Bloomberg / Doctoroff recusals (emphasis supplied):

The Conflicts of Interest Board agreement Bloomberg was supposed to follow:

. . .said that the mayor would recuse himself “from all city matters involving Merrill.” But when the drama erupted over Merrill Lynch’s possible relocation from Lower Manhattan, the mayor picked up the phone and called E. Stanley O’Neal, who was then the chief executive, “one or two” times, according to Jason Wright, the Merrill spokesman.

* * * *

. . . Mr. Bloomberg does not recall any such conversation. But he said that, while Mr. Doctoroff was put in charge of the negotiations with Merrill, it would have been “entirely appropriate” for the mayor to offer his administration’s assistance.

Mr. Loeser said Mr. Doctoroff will now recuse himself, as well, from any dealings involving Merrill or cable television.

In another matter involving Merrill, the mayor has signed off on $1.43 billion in municipal bond deals in which the investment firm was the lead underwriter and several more in which the firm was part of the underwriting team, according to city records.

* * * *

. . . the mayor’s office has never sought a waiver from the conflicts board to allow for an exception to its 2002 opinion.

* * * *

Councilman Avella has raised another issue involving recusal: this one about the city’s continuing negotiations with Verizon as it seeks to break into the lucrative cable television market here.

* * *.*

Bloomberg Television, which reaches more than 200 million households worldwide, is carried by major cable operators in the city. And the mayor has not been shy about voicing his views on cable industry issues, saying, for example, that cable rates should be able to rise without government interference.

Mr. Avella said it is not credible that the mayor is uninvolved, especially with the huge revenues at stake for Verizon and the city. He added: “Even if the mayor has recused himself directly, who is then overseeing the city negotiators? He is obviously involved in leading these discussions at some level, somewhere. Where is open government in all this?”

Bloomberg needs to recuse himself. Doctoroff now needs to recuse himself. Who does that leave in charge who is not recusing themselves? We are now ready to talk about First Deputy Mayor Patricia Harris, currently Bloomberg’s number one in City Hall.

Patricia Harris’ Conflicts

Deputy mayor, Patricia E. Harris (sometimes reported upon as “Patti Harris”) like former Deputy Mayor Daniel Doctoroff also has both Bloomberg L.P. responsibilities and responsibilities affecting major New York real estate development projects. Deputy Mayor Harris, a City Hall official, is who the Times went to in 2007 (when her salary was $225,000 a year) for information about and a characterization of the Bloomberg’s “private” giving through his Bloomberg L.P. business:

“He’s continuing to be more generous and give to more organizations, but the focus has remained consistent,” said Patricia E. Harris, a deputy mayor who helps oversee his philanthropy. She added that his main areas of focus have been medical research, public health and the arts.

(See: Bloomberg’s Gifts to Charity Exceeded $165 Million in 2006, by Diane Cardwell, September 17, 2007)

Ms. Harris, who once worked for the Koch administration ,shifted over to the private sector and was working for Bloomberg in 1994 before his ambition to become mayor emerged. She was “Bloomberg L.P.'s Corporate Communications Department . . . overseeing its Philanthropy, Public Relations, and Governmental Affairs divisions.”

Very important to the real estates industry, First Deputy Mayor Harris also oversees the city’s Landmarks Preservation Commission, as we noted in Times Coverage of Landmarks Preservation Commission: The Pieces Needing to Fall Into Place (Tuesday, December 9, 2008) and is likely to have had a hand in promoting the Atlantic Yards project when she and Mayor Bloomberg met with the Atlantic Yards developer Bruce Ratner. That meeting bore evidence of a quid pro quo exchange of contributions to Bloomberg charities in exchange for project approvals. For more on this, see: Are the Atlantic Yards Land Grab and City Official Fraud Being Used to Finance Bloomberg’s Bid for Billionaire Term Limit Exceptionalism? (Wednesday, October 22, 2008).

Deputy Mayor Harris’ Failure to Be Sensitive to the Conflicts

Certainly the probability of substantial conflicts is present in these dual roles. Can it at least be said that Ms. Harris and the Bloomberg administration were sensitive and attentive these likely conflicts? Now, it is reported that Ms. Harris and her assistant, Allison Jaffin, performed the dual roles, failing to inform or obtain approval from the Conflicts of Interest Board beforehand. From the Daily News coverage:

The city charter generally bans bosses and subordinates from entering into business relationships with each other or doing private work on city time unless the Conflicts of Interest Board agrees it is in New York's best interest.

As the mayor tries to figure out what his third career is going to be - politics, philanthropy, something else - the line between his public and private lives seems to be growing increasingly muddy.

He insisted this summer he had no involvement in his media company and then had to backtrack a few days later, admitting he talks to top execs frequently.

(See: Mayor Bloomberg's aides staff his foundation without city ethics check, by Kirsten Danis, December 23rd 2007.)

In the article a Bloomberg spokesperson referred to Harris’ Bloomberg, L.P. work as a “minimal amount” when just two months earlier the Times was quoting Ms. Harris and writing about her overseeing what had been $165.3 million to 1,077 groups the previous year and Bloomberg was going to be “more generous” (to quote Ms. Harris) to the tune of $205 million in the year when the question came up.

And the City Health Commissioner’s Dual Role

The article reported that the Bloomberg administration also had Health Commissioner Thomas Frieden working with the Bloomberg L.P. foundation (which involved travel to China) and because he had obtained permission from the Conflicts of Interests Board, the administration suggested that Ms. Harris similarly doing so was unnecessary. Because we at Noticing New York know and appreciate and care more about the possibilities for conflicts in the real estate industry we won’t comment to compare how similar the Health Commissioner’s possibilities for conflict were.

Bloomberg Entrusts Deputy Mayor Harris. . .

How involved in major city-assisted real estate projects is Ms. Harris and how sensitive should she have been to possible conflicts of interest with respect to them? It was Deputy Mayor Harris who submitted the request for a conflicts of interest waiver for Daniel Doctoroff to the Conflicts of Interest Board.

The Times reported that Ms. Harris’ job includes being:

officially in charge of New York City whenever Mr. Bloomberg leaves town. But perhaps more significantly, she will see to it that the mayor's vision for the city is carried out in his second and final term as he seizes on the momentum from his huge electoral victory.

(See: Bloomberg's New Deputy Has a Velvet Fist, by Jennifer Steinhauer, December 6, 2005.)

It reports:

Ms. Harris is by far the most powerful person in the Bloomberg administration, a role rooted in her past at Bloomberg LP, where she served as director of his philanthropy for several years.

* * * *

They have a very secure relationship.

* * * *

"The mayor trusts her implicitly,"

(According to William T. Cunningham, who helped run both of Mr. Bloomberg's campaigns.)

Explicit Acknowledgment of Harris’ Use of “Charity” for Political Purposes

The Times article which is almost in the nature of a puff piece reports explicitly about the her role in utilizing the mayor’s “philanthropy” as a tool for political ends; apparently without realizing the full ramifications thereof:

Last year, when Ms. Harris became aware that some people in the arts world who had benefitted from Mr. Bloomberg's philanthropy had given political donations to one of his early campaign rivals, City Council Speaker Gifford Miller, she called them and demanded to know what they were thinking.

Extensions of Deputy Mayor Harris “Philanthropy”-based Power

Right now Ms. Harris’ “philanthropy”-based power has been expanded because, besides overseeing the mayor’s Bloomberg L.P. giving, the article writes about the control and influence she exercises over the City Hall-based Mayor's Fund to Advance New York City and its chairman. That’s for now. What does the future have in store? As noted, Ms. Harris was once in the private sector working for Bloomberg (de facto chief of staff) on his “philanthropies.” Now as a city official she continues to do so and the Times article says that with respect to the future she:

will continue to run his philanthropy once he leaves office. That endows her with formidable power beyond his term, . .

(Ms. Harris’ predecessor, Deputy Mayor Mark Shaw, went to work for real estate developer Extel Development company upon departing government.)

Ms. Harris’ husband, Mark D. Lebow, is a lawyer with Lebow & Sokolow LLP whose practice areas include real estate. Bloomberg appointed him to the board of the Metropolitan Transportation Authority and Ms. Harris’ stepson also works for the Bloomberg administration.

The Conflicts of Mayor Michael R. Bloomberg Himself

What about the mayor’s own conflicts in running the city while accreting so much wealth through his private company? His conflicts while controlling so much “charitable” giving? Among other things, the above-discussed conflicts of his senior people must travel up the ladder to be laid at his doorstep as well. But Mr. Bloomberg isn’t good at seeing conflict. Even though the Times wrote so explicitly about Ms. Harris’ use of “philanthropies” for political purposes, when the need for Ms. Harris to obtain Conflicts of Interest Board approval was raised, Mr. Bloomberg professed to see no possible conflict:

“She has been handling all of my philanthropies for all the years I’ve been in office,” the mayor said. “And whether she does it through a foundation or directly, there is literally no difference in terms of potential conflict.”

(See: Ruling Allows Wider Investment Options for Bloomberg and His Foundation, by Ray Rivera, December 27, 2007.)

The mayor is perhaps right: Whether the deputy mayor handles his “philanthropies” directly or indirectly does not affect the potential conflict. The conflict presents itself either way.

New 2007 CIOB Opinion

Ironically, the mayor’s statement was in an article that reported that the Conflicts of Interest Board was issuing a new 2007 opinion imposing specific theoretical restrictions on the mayor himself vis-a-vis his relationship with his private foundation. Given Mr. Bloomberg’s use of Ms. Harris to oversee his philanthropy, one would expect that she might easily be violating those same proscriptions applicable to Mr. Bloomberg without guidance.

What a Disobedient Mayor Does

It’s worse than that in several ways. The new Conflicts of Interest Board requirements were new because they were requirements that were being relaxed from what was previously required. At the same time, long into Bloomberg’s second term, it was being reported that Bloomberg had not complied with requirements to avoid conflicts that the Conflicts of Interest Board imposed upon him at the beginning of his first term.

In that same Times article:

In a 2002 agreement with the conflicts board, the mayor promised to limit his involvement with his company to major decisions that would have a significant impact on his ownership value. Throughout his two terms, the mayor repeatedly insisted that he had no involvement in the firm’s day-to-day operations.

This month, however, The New York Times reported that the mayor talked regularly to senior officials at the company about topics ranging from new data terminal sales to expansion into new markets and the general financial performance of the company. He even recruited the company’s spokeswoman.

And despite the 2002 agreement, which required him to recuse himself from any city business involving Merrill Lynch, the biggest investor in his company, the article said the mayor had taken numerous official actions that involved Merrill Lynch.

Not unexpectedly the Administration denied any problem:

Administration officials insist that Mr. Bloomberg has not violated the 2002 opinion.

Inadequacies of Agreement With Which Bloomberg Failed to Comply

The Times reports that much of the language of the 2002 ruling with which Bloomberg failed to comply was supplied by Bloomberg’s own lawyers. It also points out that its disclosure is antique, setting forth “Bloomberg L.P.’s top 100 customers” without update since 2002 when, comparatively speaking, Bloomberg was a considerably less bruising presence, his company’s customers now including “virtually every major financial institution in the city.” (The Roles Blur for the Mayor and the Mogul, By Serge F. Kovaleski and Ray Rivera, December 8, 2007.)

Once Again the Bad News is that “Charity” is Good

What seems to have convinced the Conflicts of Interest Board to give more freedom to a disobedient mayor in the new 2007 Opinion? Apparently, the deceptively all-too-simple argument that bolstering Mr. Bloomberg’s wealth and “philanthropic” potential would be good. To this end the board decided to:

allow him to move his money into more aggressive investments, including hedge funds and publicly traded stocks.

Because?

The mayor’s spokesman, Stu Loeser, said Mr. Bloomberg was not seeking the changes to expand his personal fortune, which has been estimated at anywhere from $5 billion to more than $13 billion. But he said that as the director of the Bloomberg Family Foundation, the mayor “has a responsibility to maximize the amount of money it has to give away to charity.”

(Note: The $13 billion figure is closest to the Forbes estimates.)

New Flexibility For the Mayor

The article explained:

The ruling by the five-member panel modified a key element of an opinion it issued in 2002 that urged the billionaire mayor to sell all of his stocks, along with his interests in a hedge fund, because the holdings violated the city charter.

(Bloomberg complied with that part of the directive.)

Specifically this was spelled out as the arrangements with which the mayor (Ms. Harris too?) was theoretically expected to comply:

Under the arrangement, the mayor will select one or more investment firms to oversee his personal and charitable foundation’s investment strategies, and then recuse himself from any city business involving those firms.

The firms will then choose managers who will carry out the investment decisions, but their identities will not be shared with the mayor, the board said.

* * * *

. . . the mayor could advise the investment firms about categories of investments and could hire or fire managers based on reports about their performance. But the mayor must receive no information about the specific holdings in his or the foundation’s accounts, and must not know the identities of the managers, the board said.

Is this adequate protection for the public when dealing with a mayor who had already demonstrated disobedience? Maybe not, but it was expected that it would sound good to the public:

“The proposed arrangement will not conflict with the proper discharge of his official duties, and it avoids the appearance of conflict to the public,” the board said.

It Ain’t Something for Nothing

One should always beware when something is offered for nothing.

Once upon a time, the idea was that we were going to have a mayor so wealthy that he was not interested in the acquisition of further wealth, a mayor so wealthy that he was motivated by pure generosity. Bloomberg was supposed to represent “a new paradigm,” “a businessman and a technophile, a man focused on communication and transparency,” a “technocrat-mayor” who didn’t personalize conflict. We were even relieved of contributing to the political campaign he willingly paid for himself! (See: The New Paradigm, Has Bloomberg changed the mayoral model forever? By Edward-Isaac Dovere.) But that was always just public relations preamble to the facts. The facts now deserve another look.

The Conflicts of Interest Board’s 2007 opinion is specifically about accommodating the mayor in the continuing acquisition of more wealth. Results speaking for themselves, that is something he had already done very well throughout his administration. Rather than generously giving money away, Bloomberg “donates” money to acquire more personal power and perhaps to acquire still more money as well. It even turns out he is driving up public expenditures on mayoral campaigns! Whereas once upon a time we were told we were going to have a mayor who was so angelically generous that we didn’t have to worry about anything, we now find that we have a mayor so financially omnipresent and capable of corrupting charity that we need to worry about everything. It is almost like a real life version of the jokey chestnut episode of the Twilight Zone, To Serve Man.

An Enormous Problem in Context

Given Bloomberg’s omnipresence, getting far enough away from him to avoid conflicts of interest is a daunting proposition. It is increasingly hard since Bloomberg has gone in a decade from just one of the wealthy (# 56 on Forbes list in 1998, # 42 in 2001) to the wealthiest New Yorker (# 8 richest American on Forbes list for 2008).

The Times had a paragraph that framed the enormity of the problem nicely:

The opinion is the latest ruling to try to address ethical questions created by Mr. Bloomberg’s public and private roles. The mayor not only runs a city that is one of the world’s financial capitals and retains a majority ownership of Bloomberg L.P., a media and financial information giant whose customers include many of the city’s biggest banking firms. He is also a philanthropist whose private giving often involves nonprofit agencies active in civic and neighborhood affairs.

Increase of Bloomberg Wealth at Taxpayer Expense?

Setting aside conflict-of-interest abuse of charities to enhance personal power, there is also simply the question of Bloomberg’s possible conflict-of-interest abuse to enhance his wealth at taxpayer expense. It should not be disregarded.

Our Capability to Know

How might Bloomberg make money at taxpayer expense? And how much do we know about how he might be doing so? Don’t expect information about what Bloomberg is actually doing to accomplish the phenomenal increase in his wealth to be readily available:

Releasing details of Mr. Bloomberg's tax returns could reveal too much to his company's corporate rivals, said his director of communications, William T. Cunningham.

(For Bloomberg, 'Rich' Is Just Too Weak an Adjective, by Leslie Eaton, July 3, 2004)

Long Live Bloombergian Competition?

“Corporate rivals?” Apparently it is acceptable to acknowledge that Bloomberg IS competing for wealth when it is convenient to withhold information about what that entails, even if that may be inconsistent with the original public relations spiel that Bloomberg was a man who was beyond that self-centered phase of his life.

Education in His Finances: Bloomberg Tax Return 2002

Early in his administration the Conflicts of Interest Board ruled that Bloomberg had to sell all of his individual stocks. (Note that does not preclude all the ways that Bloomberg might benefit from changes in stock market. Note also the later, more relaxed, permissions of the COIB’s 2007 ruling.) The sell-off of the stocks involved occurred in the 2002 tax year. The Times reported that he had losses associated with selling stocks that year: “at least $1 million of his personal fortune” which was at the time, given conflicting information, $4 billion? $5 billion? Forbes had it going up from $4 billion to $4.8 billion from 2001 to 2002. According to the Times (emphasis supplied):

Only the mayor knows whether his stock market loss was close to $1 million or far more because the mayor disclosed only three numbers yesterday in making available for review heavily edited portions of his income tax returns.

(In 2002, Bloomberg Lost a Bit (for Him) and Gave a Lot, by David (Cay) Johnston, June 14, 2003.)

In the article, the mayor's communications director pointed out that Bloomberg was paying taxes at the maximum rates and despite the heavy editing of the tax returns his “charitable” giving was sufficiently evident so as to become a good portion of the Times story. All the mayor’s income was income from investment:

The two taxes the mayor escaped were Social Security and Medicare taxes because his only salary is a dollar a year from the city. Those two taxes do not apply to investment income.

Is this to say that Bloomberg was not actually working to increase his private sector wealth? (Remember his later-revealed contacts coordinating affairs with senior Bloomberg L.P. executives.)

What do we really know? (Emphasis supplied)

While the mayor's 2001 tax return was a rich sea of G's, this year a number of E's, C's, A's and a few blanks -- meaning less than $1,000 -- showed up on the heavily edited documents that reporters were allowed to examine at Geller & Company accountants in Manhattan.

Asked if the mayor would sign legislation that added new categories, say for laddered categories of amounts up to $500 million, Mr. Cunningham said he did not want to discuss policy issues.

Hot Stocks: Hot Tips?

It may readily be envisioned that the Conflicts of Interest Board required the sale of Bloomberg’ individual stocks because of the possibility that he could benefit from special information and relationships. The concern is not necessarily insider trading, per se, which would be illegal, but akin to it. In that regard, what do we know about what kind of stock investor Bloomberg actually is?

The limited documentation showed that the mayor's competing teams of investment managers sought quick gains, often investing heavily in hot stocks, and that the mayor was not a buy-and-hold investor.

With the relaxed 2007 Conflicts of Interest Board ruling this kind of stock investment (and hedge fund) activity can resume.

Released From the Stocks: Terminal Interest

But are the stocks in which a wealthy Bloomberg invests the main concern? Bloomberg’s business is founded sale of the Bloomberg terminals to the financial community. That is core to the question of where he takes in most of his profit.

The possibility that Bloomberg’s terminal business could involve conflict-of-interest problems got some attention in a January 2002 New York Times article (before the Conflicts of Interest Board ruling) which is almost laughable in the way that it fails to identify the greatest possibilities for conflict-of-interest concern.

Once Again Charity IS the Bad News

Once again, Bloomberg’s ostensibly charitable nature is the grist used in a PR feint: The Times article reports about how Bloomberg, L.P. is “donating” 35 Bloomberg terminals to the city for use by members of the mayor's staff together with “seven other terminals that were previously being leased by the city's financial departments” in order to pay “heed to conflict of interest laws that forbid elected officials to sell goods and services to the city.” (See: Mayor Brings His Gadgets, And Thorny Conflict Issues, by Edward Wyatt, January 6, 2002.)

The article almost puffs over the nonviolation of conflict of interest rules:

Mr. Bloomberg and his company will receive no direct financial advantage from the city's use of the terminals -- and as a donation, the terminals violate no conflict of interest rules

and

''The reason for the donation was to alleviate the potential conflict of interest,''

For `balance’ the article fusses over the “reputational capital,” that might be created by the “the commanding presence that the Bloomberg terminals will have at City Hall” . . . “an asset that has value even if it does not show up on a balance sheet” according to "Kevin T. Jackson, an associate professor of business ethics at Fordham University."

In fact, by the article’s fourth paragraph, it is still talking about how the appearance of the Bloomberg terminal “at City Hall put the Bloomberg, with its sleek monitors and acres of flat-screen space, on the public stage as an object of desire” is a “a product placement that would make any marketing director salivate.”

Putting the Object of Desire on the Public Stage: Ominous Message?

Albeit that product placement and reputational capital idea is a valid concern, what goes unstated in the article is the slightest thought that placing the terminals on “the public stage as an object of desire” can also send a clear message about how easy it could be to deliver benefits equivalent to a kick-back.

This is why it is a critical concern that the Times reported, as noted above, that for years thereafter (emphasis supplied):

the mayor talked regularly to senior officials at the company about topics ranging from new data terminal sales . . . .

Sales of Bloomberg terminals were shooting up in the years just before running for mayor when Bloomberg’s billionaire fortune essentially doubled, according to data available for 1997, 1998 and 1999. (See: The Company He Keeps (for Now), by Timothy L. O'brien, March 20, 2005.) But increased sales do not correspond in arithmetic proportion to increases in profit. The industry is somewhat of a diminishing marginal cost business; after a point, most costs have been paid for, so sale of each additional terminal beyond that point is essentially gravy.

If you analyze it, all it takes for New York financial firms to deliver quid-pro-quo benefit to the mayor in a virtually undetectable fashion is for them to order more Bloomberg terminals than they otherwise want or need. And, as noted, each additional terminal is almost pure gravy, pure cash to Bloomberg. For the years that the mayor has been in office, Wall Street has been far and away that largest sector of the city’s economy and, as the Times asserts, Bloomberg does business with“virtually every major financial institution in the city.”

Comfortable With the Bloomberg Terminal?

The Times article on the “donated” terminals said that the terminals had been given in part because of Bloomberg’s own comfort with the system:

The donations are not an attempt to further market the Bloomberg name, his aides said. ''It was just the fastest way to get the office set up with computers,'' said William T. Cunningham, the mayor's communications director, who added that the system is the one that Mr. Bloomberg is most comfortable with.

The new hardware lets users get e-mail messages, do word processing, make spreadsheets, surf the Internet, as well as gain access to the news services and financial market data typically offered to Bloomberg customers, all without the bother of flipping between windows on a single screen.

But the system Bloomberg was switching everybody at City Hall over to was not necessarily designed for everybody else’s comfort, as reported in the later 2005 Times article about Bloomberg’s terminal business:

Early Bloomberg users needed to pick their way around the terminals using arcane commands and interfaces, many of which persist today. Mr. Bloomberg believed that once people were trained in how to use a Bloomberg terminal, no matter how confusing, it would make them less inclined to switch to other systems. He also insisted that every new service or data point be bundled inside the Bloomberg and never sold separately, increasing the value of the machine and allowing the company to charge a premium to use one.

Skepticism? Bloomberg, Wall Street City’s Financial Leadership?

Given the lack of separation between Bloomberg business interests and Wall Street, we must inevitably speculate skeptically about poor financial leadership of the Bloomberg administration. (See: Saturday, October 25, 2008, More Discredit of Bloomberg as Qualified Financial Crisis Leader.)

Sufficient Separation?

We started this Part II asking whether we should feel confident of sufficient separation between the worlds of big mega-deal city administration-assisted real estate development and the Bloomberg private wealth businesses that are growing so fast. The answer is no, given the troubling conflicts we see at the highest level of the Bloomberg’s administration and business involving Daniel Doctoroff, Patricia Harris and Michael Bloomberg himself.

Charitable “Giving” Bad News: No Light at the End of the Tunnel

That now brings us back to where we started with Part I of this article, that more “charitable giving” by Bloomberg is bad news.

The worse news is that there is no light at the end of the tunnel.

Don’t expect the flow of Bloombergian “philanthropic” money to abate. Even though more than a billion dollars have been distributed since Bloomberg became mayor, we may have seen nothing compared to what is yet to come. Bloomberg has a hands-on attitude about distributing his money. He says he wants to do it all himself when he is alive, joking about the desirability of having the “check to the undertaker” bounce. (See: Bloomberg’s Gifts to Charity Exceeded $165 Million in 2006, by Diane Cardwell, September 17, 2007) That means we can project a huge flow of money, much more than we have seen to date. Born February 14, 1942, Bloomberg is about to be 67 years old. Assuming that he lives to a ripe old age and “gives” away all his money over another 30 years (even without his current wealth increasing still further), that would mean, dividing equally over those years, distributions of $666 million each and every one of those future years!

Bloomberg has disclosed political ambitions sufficient to keep him on the scene through a considerable portion of all his "philanthropic" years: running for governor or even a second run at the presidency. He wants to be mayor for another five of these future years. Five more years . . . unless he has another term limits extension surprise in store for us. Would that be unachievable?

As the New York Times commented about the public promise that First Deputy Mayor Harris will, in future years, even after leaving her current public office, be coordinating dispersal of Bloomberg's $20 billion:

That endows . . . formidable power beyond his term, . .