Contrivance in the service of creating blight, real blight- Listen again- REAL blight

There are times, like now, when I bemoan the fact that I am a mere mortal- It is times like these when there is so much happening that would be worthwhile for Noticing New York to bear witness to.

I just can’t type, think or take shorthand anywhere near as fast as Norman Oder of Atlantic Yards Report. (Is Mr. Oder not a mere mortal?- Possibly.)

The theme for heavily-evented Wednesday, Thursday and this week as a whole is deceit, manipulation and contrivance in the service of bringing blight to our communities.

Wednesday Morning

Wednesday morning State Senator Bill Perkins held hearings about the need for eminent domain reform in New York where eminent domain abuse probably outstrips such abuse anywhere else in the country. From Atlantic Yards Report:

“Nowhere else in the country is eminent domain used to benefit private interests so rampantly and so brazenly,” declared Christina Walsh, a representative of the Institute for Justice, the libertarian legal organization that has led the fight nationally against eminent domain.

For the most complete and best account of the hearing, see that Atlantic Yards Report article: Thursday, September 18, 2008, At state Senate hearing, calls for reform of state eminent domain laws, notably blight

For the Noticing New York testimony we provided at that hearing, keep reading; it is provided below, at the very end of this post.

Speakers wishing to speak at the hearing spoke by invitation. It was mostly a forum for opponents of eminent domain. Senator Perkins said that Empire State Development Corporation was invited to testify but did not do so and an ESDC representative present in the audience did not speak.

The overall story told was one of developer/private-sector-driven eminent domain where manipulations and contrivances are used to find fictional blight and/or create ersatz or self-created blight conditions. This is not to say that communities don’t, ultimately, suffer real blight created by these machinations whenever eminent domain abuse plans get traction. More on this later. Government agencies were depicted in the testimony, (with an awful lot to back it up), as complicit and “for rent.” People spoke about how plans for eminent domain proceed without cost benefit assessments, how there is insensitivity to the communities whose wishes are often overridden, and insensitivity to those whose property is condemned with inadequate compensation. With one-sided private profit benefit driving these plans there is deep doubt about the validity of the objectives of many of them.

The overall quality of the testimony was extraordinarily excellent. I especially appreciated the following points made by Daniel Goldstein of Develop Don’t Destroy Brooklyn excerpted in the Atlantic Yards Report coverage:

When “used as an excuse” for eminent domain, “economic development” is always “highly speculative for the public while the eminent domain itself makes it a sure thing for the developer.”

* * *

“Every single purported public benefit touted by the Empire State Development Corporation (ESDC) could be achieved without the use of eminent domain. The only reason eminent domain is being used for the Atlantic Yards project is to give a massive private benefit to the private developer—the windfall benefit of cheap land and the windfall benefit of a complete zoning override.”

* * *

“The use of eminent domain for Atlantic Yards clearly serves no public purpose whatsoever,” he said. “If the purpose of the project was economic development, as claimed by the ESDC, then the proper way to accomplish that would be to rezone the area.”

* * *

“the agency’s predetermined analysis found that the exact same footprint that Ratner had drawn up in his boardroom was blighted”

I am fascinated by how one piece of Goldstein’s testimony above, which is absolutely correct, fits in with another piece of testimony also given at the hearing that was also absolutely correct. Goldstein is absolutely correct when he says: “If the purpose of the project was economic development, as claimed by the ESDC, then the proper way to accomplish that would be to rezone the area.” At the hearing, attorney Philip Van Buren was similarly absolutely correct when he noted that consultant AKRF was arbitrary in its Atlantic Yards Blight Study, asserting that buildings not utilizing 60% of its development (zoning) rights are “underutilized.” (He pointed out that "The City Planning Commission uses 50% for its policy planning purposes" and that “even 50% is arbitrary.”

If failure to immediately utilize 60% of all of a parcel’s zoning rights means that property is “blighted” then huge portions of the city are blighted. Further, if I had been an owner of property in the Atlantic Yards footprint prior to the advent of Forest City Ratner’s land grab I would have been betting that an upzoning to promote extra development would have been likely. I speak of exactly the kind of upzoning Goldstein suggested was appropriate. In retrospect, it would have been a good bet, because the Atlantic Yards plan entails exactly that; an upzoning. (The problem is that ESDC is manipulating the upzoning in an unfair way to give all the benefit of the upzoning to Ratner rather than to the dispossessed owners who were entitled to make such a bet.) If you are betting on such an upzoning then it is good for you and good for the community if you speculatively wait to develop your land until the upzoning occurs. Your right to make and get the benefit of a desirable and smart investment decision is part of what privately-driven eminent domain takes away.

(After the hearing, I was talking with Henry Weinstein, an Atlantic Yards footprint developer who also testified at the hearing. He and Shaya Boymelgreen, another Atlantic Yards footprint developer, were certainly thinking in terms of development in the area because they were executing contracts about the use of development rights before Ratner appeared on the horizon. Both these footprint developers are now in a lawsuit that does not reflect well on ESDC or Forest City Ratner and should, in my opinion, cause people to speculate about the peculiar shape proposed for Atlantic Yards. See: Wednesday, March 07, 2007 “Unclean hands”? Judge raps Boymelgreen, Ratner in AY lease dispute.)

Although no one in favor of eminent domain testified at the hearing, the other side fought back with two op-ed pieces in the Daily News, one by Kathy Wylde, president of the Partnership for New York City, We need eminent domain to keep New York City growing, September 18th 2008, the other by Errol Louis, the Daily News columnist who frequently writes pieces promoting Atlantic Yards: The right way to fight blight, September 18th 2008. Louis mentions “Melrose Commons” as an example of the benefits of eminent domain. Coincidentally, there was testimony at the Perkins hearing by attorney Michael Rikon with respect to Melrose Commons related litigation: Rikon testified that more than a decade has passed and condemnees still await their full condemnation awards.

Wylde writes:

It is not as though these property owners are being left empty-handed. Far from it. Those trying to redevelop the property are required by law to offer them "fair market" rates for their land - and often bend over backward to go further, seeking to negotiate the best possible deal above and beyond that obligation. But in some cases, the holdouts refuse nonetheless.

This is naive, trite and just plain false. It sounds as if Ms. Wylde received, with much less skepticism, the same PR spiel I got from a Columbia/ESDC transaction attorney who approached me when I exited the ESDC eminent domain hearing held earlier this month. I wrote about our exchange in my account of my ESDC testimony. I also referred to it in my testimony Wednesday as I refuted the incorrect notions he and Ms. Wylde are promoting.

As Ms. Wylde has a position with an organization that is supposed to be promoting good development practices, I find it a second great lapse that she does not appreciate that eminent domain abuse does NOT promote economic development. It does the opposite. Eminent domain abuse misdirects economic resources, thereby dragging down the economy. The games of playing up ersatz blight and the way it halts, sometimes for decades, real ongoing development hurt everyone. I refer everybody again to statistics furnished by the Institute of Justice on this point, that eminent domain does not provide economic benefits, (op-ed piece, An Unnecessary Abuse, authored by Dick Carpenter, director of Strategic Research for the Institute for Justice, (January 15, 2008) and to the Wall Street Journal editorial Eminent Reality, January 30, 2008, wherein the Journal warns about the record of government putting its “hamfist” on the scales to promote projects that cannot proceed “without government interference” and in favor of the “most grandly conceived plans” which “are also often those most likely to fail.”

To my mind Wylde is wrong on both sides of the insufficiently considered “cost benefit” analysis she offers. If we are agreed that, as she suggests, “New York is facing some tough economic times” certainly now is not the time to drag things down further with eminent domain abuse and no-bid handouts to the likes of Bruce Ratner.

If anyone can possibly doubt that eminent domain in New York is accompanied by huge misdirections of public resources then we should move on to the subject of the Nets arena and Assemblyman Richard Brodsky’s report.- See “Thursday” below.

Wednesday Afternoon


After Senator Perkins’ eminent domain hearing there was hardly time to get to the oral argument, in the state lawsuit challenging the Atlantic Yards environmental review. For the most complete and best account of the oral argument see the Atlantic Yards Report article: In appeal of case challenging AY environmental review, some justices skeptical of state’s blight claim.

Once again we were considering a record of deceit, manipulation and contrivance in the service of bringing blight to our communities.

The oral argument dealt with the fashion in which ESDC engineered its arrival at its predetermined goal of finding blight for the peculiar project footprint the developer originally drew. Norman Oder’s Atlantic Yards Report will give a better feeling for the technicality of some of the discussion. I couldn’t always see which justices were speaking but his account breaks it down, complete with information about political background of the justices. In all, you will probably get a more tempered sense of cautiousness from the meticulousness of his writing than from my own.

There is no assurance that, as I hope, the judicial review of this case will dispose of things based on the real reality of what is going on. I have written previously about the difficulty of judicial review of politically-wired deals: Wired Deals. Still. There are glimmers that this time the facts might trump the fictions in this case.

I heard reality in the room.

At the oral argument, Jeff Baker, the attorney for the plaintiffs, including Goldstein, stated that “the project sponsors predetermined the site, with no mention of blight, and the Blight Study never looked beyond the project footprint.”

Looking at the question of the predetermined outcome of the “analysis” undertaken, I heard one Justice ask ESDC’s attorney whether consultant AKRF has ever studied an area that it didn’t consider blighted. He said he knew a lot about this because he had just written about AKRF and Columbia University. (In both the Columbia University and Atlantic Yards situations AKRF worked for both the private entity and theoretically also for the government, raising all sorts of accountability and conflict of interest issues.)

I heard justices suggest that the procedures ESDC was arguing for would mean that ESDC would always, per se, have the right to build whatever it wanted to (presumably meaning absolutely unfettered with no check or balance).

I heard the judicial question asked of the ESDC attorney, Philip Karmel, “You don’t seriously argue that the blight study is solely an objective conclusion?” “Certainly not wholly objective?”
Everyone clearly acknowledged there was new multi-million dollar development in the form of recently rehabilitated buildings within the footprint that is being condemned as blighted.

The justices asked questions about the new development within the site. They asked how new it was. The ESDC attorney awkwardly acknowledged that it was very new. (It is exceedingly reasonable to believe that the fact of new development going on in the area is what made land grabbing so attractive to Ratner in drawing his lines around the land he wanted. He knew about the development as he was in negotiation with those local developers responsible.)

The justices asked whether other development was planned in addition to the new development going on. Such was the case. (In fact, one of the developers with such plans was in the room listening to the oral argument.) The justices asked whether it wasn’t reasonable to conclude that such development would continue. Whether, when development occurs, isn’t momentum an important factor? Whether there was a concept of needing to give neighborhoods a “fair chance” to develop? Whether, in essence the area was not being given a fair chance to succeed?

Karmel, the attorney for ESDC, acknowledged that the area was improving. Having acknowledged the area was improving, Karmel, asserted, (incorrectly?) that improvement was irrelevant because when ESDC wanted to condemn property, ESDC did not have a burden of proof to show that without ESDC’s “intervention” the area would remain the same. (As Nick Sprayregen testified at the Senator Perkins’ hearing there is a lot to be said about the lack of due process when one private owner goes after the forced transfer of another’s property through eminent domain abuse. That includes all sorts of burden of proof issues and the ability to obtain and present evidence.)

There seemed to be a sense that new development might be a particularly important evidentiary factor in a “poor neighborhood.” People are generally conscious that, as discussed at the federal level in the Kelo case, poorer neighborhoods have a special vulnerability when private developers want to come in and seize property. When it comes to developing “unslumming” neighborhoods, I have referred to this as knocking the less advantaged off the up-economic escalator. Quoting the justices in the room Wednesday: “If there’s all of a sudden new development in a poor neighborhood, why would we characterize it as blighted?”

In all, it seemed quite clearly understood by everyone, ESDC’s counsel included, that there were buildings within the footprint that were definitely NOT blighted as exemplified particularly by the recent multi-million dollar gut-rehabilitation co-op conversations. Further, it seemed quite well understood by all and sundry that the peculiar shape of the footprint had been drawn to exclude equivalent buildings in essentially the same vicinity that were also not blighted. (Everyone should be conscious of the multiple exceedingly tangled relationships between Forest City Ratner, Boymelgreen, ESDC and the state. I therefore expect that with proper discovery much more will come out about exactly what was likely to have contributed to the footprint’s peculiar shape.)

The question everyone was clearly grappling with was whether ESDC could bless the drawing of the zig-zagging lines wherever and with whatever zigs and zags the developer wanted and thereby allow the developer to take whatever non-blighted property the developer wanted based on the fact that some blighted property was circumstantially included in the lasso. How much property within the lasso was actually blighted was not clear: It seemed ESDC, through AKRF, had only inchoate facts to offer, without analysis. Perhaps the only thing everyone seems to clearly accept is that if the rail yards themselves were built upon they would have a less negative or blighting effect on the community.

That was the reality I heard in the room.

From reality we go to magic words. Can magic words transmute reality? At one point I heard a justice putting forth in an almost prompting fashion words for Mr. Karmel It seemed to me he was halting and pausing as if giving Mr. Karmel a chance to jump in and take over the recitation of the very recognizable incantatory words. It seemed like a chance Mr. Karmel was, for some reason, reluctant and concerned about taking. I can’t for a moment believe that Karmel didn’t know the magic incantation.

The justice’s phrasing of the magic incantation went something like this:

“You are saying.. . .that though there are these new buildings within the footprint . . .. that are not blighted . .. that is not dispositive. . .. because within your discretion what you did is not arbitrary . . .because you looked at it . . .took it into account .considered .the new buildings . ..exercised your judgment and found it all to be blighted.”

I wasn’t sure why the justice offered the incantatory words. Perhaps Karmel didn’t quickly take up the incantation because he too wasn’t sure why the justice was giving him the chance to recite the magic words. He may have been fearful of signing on to the wrong choice. One possibility is that the justice was holding out the words to Karmel as the sole magic he needed, an incantation to transmute and make as good as gold everything ESDC had done, notwithstanding perverse motivations. On the other hand, could it have been offered as a trap, to test whether ESDC has the arrogance to believe that whatever they do and however improperly motivated it is, a simple magic incantation changes fact to fiction, replaces real motives with the ostensible ones that are legally permitted. Taking property for another’s private use should never be as easy as just saying a few magic words. Was it a test to find out whether ESDC thinks, as they appear to, that they are so mightily empowered?

“Arbitrary” was a key word in the discussions; whether or not the actions and determinations of ESDC were “arbitrary.” In the context of the discussions that day, it is the way to take away ESDC’s unfettered power to privilege Bruce Ratner over everyone else. ESDC’s power to give special benefits to big developer and subsidy collector Bruce Ratner at the expense of typical private property owners in the community fails if ESDC’s actions are deemed “arbitrary.” Technically, “arbitrary”is a correct word to be using from a legal point of view. It is even more or less correct from the standpoint of proper usage of English. I have problems with the word’s use however. I have less trouble with a phrase that is sometimes looked on as its equivalent, “abuse of discretion.”

Here are definitions for arbitrary from Merriam-Webster's Dictionary of Law:

ar.bi.trary Function: adjective
1 : depending on individual discretion (as of a judge)and not fixed by standards, rules, or law
2 a : not restrained or limited in the exercise of power b : marked by or resulting from the unrestrained exercise of power
3 a : based on preference, bias, prejudice, or convenience rather than on reason or fact b : existing or coming about seemingly at random or by chance or as an unreasonable act of individual will without regard for facts or applicablelaw —often used in the phrase arbitrary and capricious

With respect to more common language use try the American Heritage Dictionary:

ar.bi.trar.y, adj.
1.) Determined by chance, whim, or impulse, and not by necessity, reason, or principle: stopped at the first motel we passed, an arbitrary choice.
2.) Based on or subject to individual judgment or preference: The diet imposes overall calorie limits, but daily menus are arbitrary.
3.) Established by a court or judge rather than by a specific law or statute: an arbitrary penalty. Not limited by law; despotic: the arbitrary rule of a dictator.

Clearly, picking up the phrases from the above, the concept of ESDC’s behavior here is that its actions are “despotic” and “not limited by law,” nor “fixed by standards,” proper “rules or law,” that there is an “unrestrained exercise of power.” Clearly the ESDC actions are “based on preference, bias, prejudice,” and they may be viewed as for “convenience rather than on reason or fact.” Nevertheless, what echos in my head is the first common English usage in the American Heritage Dictionary cited above: “Determined by chance, whim, or impulse, and not by necessity, reason, or principle” or what Wikipedia sets forth to explain what “arbitrary” is: “Arbitrary is a term given to choices and actions which are considered to be done not by means of any underlying principle or logic, but by whim or some decidedly illogical formula.”

ESDC’s actions are not by chance or whim. ESDC is quite directed in fulfilling their predetermined goal of sanctioning the footprint drawn by the developer. Finding blight is entirely the logical subservient to that goal. Serving the developer’s goal of taking property is the “necessity, reason, and principle” that drives ESDC and the underlying logic guiding their actions. ESDC’s actions can only be considered to be illogical if you change the principles that should be applied: ESDC’s actions are only illogical if we say that it is required of ESDC to be concerned with what and what is not really and truly blight.

So I prefer “abuse of discretion.” In this case, I think that abuse amounts to the level of an abuse of trust which I consider, something called “bad faith.” No one talks about the “bad faith” (still another legal term of art) when they talk about the issues here. That is only because it is associated with a higher required standard of proof if it is to be judicially recognized. But doesn’t everyone sense the faith is bad?

At the end of the oral argument the subject switched over from the fictive blight ESDC was promoting to sanction the developer’s chosen footprint to the real blight with which ESDC and Forest City Ratner are now besetting the community. One of the justices asked whether it was viewed that a blight designation becomes a self-fulfilling prophecy.” No doubt, was the answer. The justice amplified that this was because development thereupon stops? Answer: Yes. Because then development would be “a foolish undertaking” concluded the justice emphasizing the point.

The way that “designation of blight” in a community converts development into “a foolish undertaking” is sometimes referred to as “planner’s blight.” This planner’s blight is exactly what City Planning Commissioner Irwin Cantor expressed concerns about with respect to the exercise of eminent domain in the expansion plan proposed by Columbia University.

As I said at the outset, the theme for this week in these events is about deceit, manipulation and contrivance in the service of bringing blight to our communities.

Wednesday Evening

Wednesday evening I went to an excellent panel discussion at the Municipal Art Society about the, I think, not-so-excellent plans for the redevelopment of Coney Island.

Afterward the subject of eminent domain came up. The City apparently does not want to consider the use of eminent domain to create a Coney Island public park and preserve its history as an amusement park. I was told the City prefers “friendly negotiations” with the developer. If the City considers that the desirability of eminent domain is inverse to the actual degree of public benefit and if the common denominator governing whether eminent domain should or should not be used is `friendliness’ to developers, we clearly have a problem.

In my conversation, I mentioned the far less appropriate ways in which eminent domain was being used. I didn’t mention Atlantic Yards but the city development officials I was talking to apparently assumed I was referring to Atlantic Yards so I was immediately informed that Atlantic Yards was “not a city project.” That made me think about what I have written concerning Atlantic Yards being a political hot potato.

As I pursued the correction that Atlantic Yards most certainly ought to be viewed as a city project with city blessing, city funds and city agreements respecting funding and development, I learned that even city development officials can be misinformed about the fact that Atlantic Yards is not all or mostly above the Vanderbilt rail yards. I am assuming that it is an example of even informed professionals picking up the kind of misinformation the New York Times has been printing when they do not know that 60% of the project is on land not over the rail yards, where eminent domain abuse comes into play as an operative feature. (Admittedly, this is not a project on which these particular individuals are working.)

I will have to return to write more about the Coney Island plans and discussion when I have more time.


Thursday

Another day, another hearing and back to the subject of contrivance and manipulation. Are these public officials who administer eminent domain for the benefit of the likes of Bruce Ratner and Columbia University above deceit, manipulation and contrivance at the expense of the public?

Not according to the report issued by Assemblyman Richard Brodsky (See: Wednesday, September 17, 2008 In Brodsky’s report slamming Yankee Stadium deal, major questions implied about Atlantic Yards arena plan) Thursday there was more testimony about this on the federal level. Congressman Dennis Kucinich's subcommittee is holding hearings called “Gaming the Tax Code: Public Subsidies, Private Profits, and Big League Sports in New York,” (See: Wednesday, September 10, 2008 Kucinich's Subcommittee to look at stadium and AY arena deals) where Assemblyman Brodsky was the only New Yorker testifying because those involved in setting up these tax-free bond transactions don’t want to testify about them (See:Wednesday, September 17, 2008 At Congressional hearing tomorrow, Brodsky will be the sole New Yorker)

One more time I have to direct you to Atlantic Yards Report for surpassingly excellent and extensive coverage of this hearing: Friday, September 19, 2008
At Congressional hearing, criticism of Yankees deal and stadium funding; IRS says final regulation coming soon.

The Atlantic Yards Report coverage addresses itself to the speculation that the tax-exempt bonds that have been issued for Yankee Stadium (and certainly any similar bonds) may be declared taxable based on the misrepresentations made to the IRS in obtaining private letter rulings from the IRS. Not spelled out is that the bonds would almost certainly be declared taxable retroactively to the date of issuance, which would mean that taxes would be owed by bond holders not only going forward but for past years as well. The IRS ruling would be invalidated because of the contrived fictions of city government officials. Accordingly, it is envisioned that the city would be called upon to step in with payments to financially compensate the aggrieved bond holders. Bond counsel on the transactions are probably predicting that the IRS would seek to negotiate a compromise. There is a persuasive argument that IRS might just want to collect money straight from the city rather than having to chase down and reopen the tax returns of multiple bond holders. Maximum liability to the city might be somewhat circumscribed to the extent that the bonds can be made subject to an early call, with or without paying an early call premium. Though the payments required from the city could be very substantial; this is not to say that they wouldn’t be proportionate to the arrogant carefreeness with which officials were willing to contrive fictive realities at the expense of the public.

Noticing New York’s Testimony at Senator Perkins Hearing

Here is Noticing new York’s testimony at Senator Perkins’ hearing. Delivering it I extemporized by adding to what I had written, reference to my long career in government and that, until recently, I was running the legal department at the state finance authorities. Also, I pointed out that the Institute of Justice recommended a simple reform of eminent domain, prohibition of eminent domain to force private-to-private party transfers, and that if that were done my list of fourteen suggested reforms would get a lot shorter.

* * * *

September 17, 2008

Senator Bill Perkins
Office of State Senator Bill Perkins
163 West 125th Street, Suite 912
New York, New York 10027

Re: September 17, 2008- Hearing on Use of Eminent Domain for Columbia University Expansion

Dear Senator Perkins:

This comment is being offered in the name of Noticing New York, an independent entity dedicated to the proposition that developing New York and appreciating New York go hand in hand.

I offer this testimony calling for eminent domain reform in New York as an attorney experienced in real estate and as an urban planner.

Eminent domain reform is sorely needed in New York State. I have written about how eminent domain driven by private entities wishing to acquire property at the expense of their neighbors has become an industry in this State. I refer you to my op-ed piece in the New York Sun, “Columbia Pulls a Kelo” (December 20, 2007). Attached to my testimony is a list of 14 recommended reforms. Today, I would like to testify about just two of them.

1. We need to prohibit the use of so-called gag order, non-disclosure, and tout-for-the-project agreements. This hearing is being held in order to find out what is going on in the world of New York eminent domain. Well, you are faced with a problem in that regard. Things are not like they were when condemnations were truly being done by the government and for a governmentally determined public purposes. In the new private-sector-propelled world of eminent domain, a new form of agreement has emerged. Private entities like Forest City Ratner and Columbia University, while obtaining property with the threat of eminent domain, now also obtain non-disclosure agreements known in the vernacular as “gag order” agreements. These agreements prohibit those selling property as they succumb to the eminent domain threat from criticizing the project and process. These agreements have been increasingly refined to disrupt the transparency of what should be a public process by including provisions that require the signers to speak in favor of the project, not come forward with facts for the public record and may designate people to speak for the signers of the agreements who will tout the project irrespective of what the signer would otherwise have said or testified about the project. In the old days when eminent domain was conducted through a government negotiation process had the government sought to get such gag orders they would more likely have been held to be unconstitutional and/or void as against public policy precisely because they would have been using government power to silence free speech and obscure a government process.

Politicians, like City Council Speaker Quinn, who support the use of eminent domain to force private-to-private owner transfers in the name of economic development say that eminent domain “should be used carefully and cautiously and it should only be used when there is an overriding greater good in the interest of the city.” But scrutiny in the service of such care and caution is not possible when the transparency of the process and public oversight are prevented through the use of gag orders.

2. Private sector-driven condemnations are an abuse, but the abuse would be a lot less enticing to abusers if those whose property is condemned were fully compensated, including for all the transaction costs that are forced upon them. I am providing, as an attachment, testimony I gave at the recent ESDC hearing about Columbia’s use of eminent domain. Leaving the hearing I was approached by an attorney involved in the Columbia transactions who averred that condemnation is not an issue because the condemned are fully recompensed. Since he is wrong about this I wanted to address it here. Since the federal and state constitutions require “just”compensation, this matter, not yet addressed by the U.S. Supreme Court, goes to the heart of what is equitable, especially when one private owner is being burdened to benefit another.

Why so many condemned businesses don’t continue should be looked at. Here are just some of the ways that condemnees are not adequately compensated. There is no compensation for a business’s good will or its advantageously negotiated (cheap) leases. The following transaction costs are not generally reimbursed: brokerage and lawyer fees to acquire new property, costs of changing employees or changing arrangements with employees, skittishness and lost business opportunities such as contracts and leases due to condemnation-caused uncertainty, defense lawyers and expert fees if it is judicially determined that the pre-litigation offer was higher, all sorts of extra internal administration costs. There is inadequate or incomplete compensation for: fixtures and investments which become worthless because the value was tied to the particular property, and interest (only 6-9%) on money that is not awarded until perhaps a decade later because of litigation. There is no compensation for the losses caused by eminent domain uncertainty such as investments made misanticipating a condemnation that doesn’t happen, or doesn’t happen when expected, investments that are not made optimally because of uncertainty, or investments not made because of illiquidity or not knowing when
the balance of the condemnation award money will materialize.

Sincerely,


Michael D. D. White

CC: Hon. David A. Paterson
Hon. Michael Bloomberg
Speaker, City Council, Christine Quinn

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LIST OF RECOMMENDED EMINENT DOMAIN REFORMS

1. Restrict use of the threat of eminent domain.

2. Prohibit pre-existing relationships between private owners who will get benefit from condemnations and the government entities expected to carry them out and allow discovery in the courts about it.

3. Prohibit so called gag order, non-disclosure, and tout-for-the-project agreements.

4. Create protections against situations where developers are donating funds or otherwise benefitting politicians and public officials responsible for making decisions
about the contemplated forced transfers of land.

5. Reimburse all the transaction costs incurred by private owners confronted by any attempted use of eminent domain to transfer their property to another private owner.

6. Require full-value compensation for those whose property is taken away.

7. Require that realization of speculative increases in value due to up-zonings be paid to the original owner.

8. Prohibit use of eminent domain in neighborhoods that are already naturally “unslumming” (even though they may still be poor).

9. At a minimum require a rigorous open-bid process.

10. Make eminent domain pursued through misrepresentations actionable fraud.

11. Require urban renewal plans to be renewed in order to maintain effectiveness.

12. Change the operative presumptions for court review of public agency actions.

13. Eliminate backdoor sidestepping of process and protections.

14. Prohibit use of eminent domain for private commercial development where the public doesn’t concur with the purported “public good.”

***

If the Sun Sets

I am a paid subscriber to the New York Sun.

According to the New York Times, that makes me one out of about 14,000 New Yorkers. The total circulation of the Sun, paid as well as unpaid, is reported in the Times article to be 96,000 (See: New York Sun May Close if Millions Aren’t Found, By Richard Pérez-Peña, September 3, 2008.)

On September 4, 2008, the New York Sun published on its front page “A Letter From the Editor: The Future of the Sun” in which Seth Lipsky, the Sun’s Editor, told readers that the Sun was “in circumstances that may require us to cease publication at the end of September unless we succeed in our efforts to find additional financial backing.”

The Void

If the Sun sets it will be a sad loss that will leave a significant void.

The Sun’s small, lean-and-mean staff provides some of the city’s best reporting on local New York City matters and often covers stories skipped over by the other dailies or gets to them first. I also value the Sun for its refreshing and lively arts reporting. Without the Sun where will we read such things as the columns by urban historian and appreciator Francis Morrone or real estate industry mavin and enthusiast Michael Stoler?

Sun’s Values

Its other values aside, I fear what I will miss most is the paper’s point of view. Though I more often than not disagree with much of what might be referred to as the Sun’s “conservative” stances the Sun fills what is right now a vacuum in our city of eight million-plus. Seth Lipsky has been quoted as saying that the Sun believes in "limited government, individual liberty, constitutional fundamentals, equality under the law, economic growth ... standards in literature and culture, education.” While I won’t vouchsafe for the quote itself I think that it is an accurate summary of what the paper is about, and the important part to me is "limited government, individual liberty, constitutional fundamentals.” You don’t need to know me too well to know that one of the prime examples I think about in this regard is our duty and obligation to prevent the kind of eminent domain abuse that our government officials are now engaging in so freely.

The New York Times is often referred to as a “liberal” or “liberal establishment” newspaper. I think that is inaccurate. I think the Times is more a quasi-Democrat-establishment paper. To me, true liberals have more in common with libertarians than is often acknowledged. The Democratic establishment and the Times have assimilated predilections to unfairly support big business at the expense of the rights of individuals and local communities that ought to be protected. This doesn’t make them different from Republicans: mostly it makes them more like them.

A Voice on Eminent Domain

The city needs voices to speak out for "limited government, individual liberty, constitutional fundamentals” and those voices should be speaking out against eminent domain abuse as a foremost concern.

The public widely disapproves of eminent domain abuse. Polls show that the public overwhelmingly disapproved of the U.S. Supreme Court’s Kelo decision, with disapproval ratings in some polls exceeding 90%. That was because the public perceived that Kelo went so far as to permit what was perceived as abuse. However far Kelo went in permitting abuse, New York government officials have seen fit to take abuse beyond the line that Kelo drew.

The Issue of Eminent Domain Ceded?

Notwithstanding how ardently the public feels about this issue, the Democratic establishment has ceded this issue to others. Those declaring themselves Libertarians are the most reliably opposed to eminent domain abuse, but Republicans have a somewhat better record of taking the right position on this issue and it must be recognized that Republican Supreme Court appointees- essentially the same ones who voted to put Bush in office in Bush v. Gore.- aligned against the use of eminent domain in Kelo.

With the Democratic establishment ceding this popular issue to others, the New York Times likewise cedes proper coverage of the issue to the extent that it aligns itself with the Democratic establishment. It should also be remembered that the Times, in partnership with Forest City Ratner, took advantage of eminent domain to build its new Times Tower. That use of eminent domain in that particular instance was assertedly abusive and Forest City Ratner’s pursuit of it with respect to Atlantic Yards unquestionably is.

The New York Times has been reconstituting itself as a national newspaper. In doing so it has been making its national coverage much more important than its local coverage. Therefore, to the extent that eminent domain abuse is used in New York, the issue has been doubly, or maybe triply times ceded.

Therefore I will miss the Sun.

Dynamic of Public Dialogue

It is interesting to note the kind of dynamic that can occur when a paper like the Sun is on the scene. This involves tooting my own horn, but why not.--

I wrote an op-ed for the Sun last December, Columbia Pulls a Kelo observing the way in which eminent domain abuse has become an abusive industry in the state. I referred in that op-ed to statistics compiled by the Castle Coalition, a project of the Institute for Justice. A month later, the Sun published another op-ed piece, An Unnecessary Abuse, authored by Dick Carpenter, director of Strategic Research for the Institute for Justice, (January 15, 2008) with statistics that showed that eminent domain abuse does not provide economic benefits. Shortly after that, the Wall Street Journal essentially elevated Carpenter’s op-ed piece in the Sun into its own WSJ editorial and opinion in Eminent Reality, January 30, 2008.

The Wall Street Journal editorial began:

Does restricting "eminent domain" -- the power of government to seize private property -- harm economic growth? A new report from the Institute for Justice looks at the evidence and concludes the answer is no.

And concluded:

The backlash against Kelo has had the healthy effect of limiting the hubris of local politicians, which is why they have resorted to these scary economic claims. We're glad to see them debunked on the merits.

In between it observed:

Developers love eminent domain because it's easier to snap up land when government forces owners to sell -- no unpleasant dickering over price, etc. Local politicians likewise believe they are best positioned to pick winners and losers and to shape the future of their cities.

(Last week the Wall Street Journal was back in action with an op-ed, Columbia University Has No Right to My Land, by Nick Sprayregen, September 3, 2008)

The progression of this public dialogue was, of course, fueled by many other events and the voices and energies of many others, especially activists and bloggers. It was inadequately covered in the Times and the rest of the regular NYC print media. My point is, would the dialogue have progressed as effectively and as meaningfully without the Sun? I don’t think so.

Wall Street Journal?

The Wall Street Journal will continue to be around, but with its acquisition by Rupert Murdoch, its editorial policy going into the future is uncertain. Will we in the future be able to expect from the Journal the kind of economic clear-thinking invoked in Eminent Reality? Just as I don’t consider the New York Times a liberal paper, I don’t consider Murdoch’s Fox News a Republican or a Conservative outlet. Fox seems more like a marketing strategy plus a strategic alliance with manipulative corporate plutocrats. Fox, specifically, may be slow to change how it markets itself but Murdoch with a far-flung empire seems flexible about allegiances with those ascending to power.

Just as the Times is being turned into a national paper, so too the Wall Street Journal is being worked on as an international brand. It can’t be expected to cover local New York news. (As foreigners are not now rushing to buy into Lehman Bros, will American financial brands still be carrying the same weight?)

A Few Sunspots? What “Pro-development” Really Ought to Mean

The Sun, though it has been an exceedingly valuable voice, hasn’t been perfect on the subject of eminent domain.

I noted at the outset that the Sun considers itself on the side of economic growth. It is palpably pro-development and pro-real estate industry. Noticing New York is also pro-development. But when you are pro-development and against eminent domain abuse there is some sorting out to do. I think the Sun needed to work more on the exercise of this sorting. Developments that get tangled up with the poison of eminent domain may tend to be bigger and in other ways more high profile: That does not mean that they should be equated with positive development.

I note the following hedge on the subject of eminent domain in a New York Sun editorial at the time of the transition from former Governor Spitzer to Governor Paterson in Paterson's Preview: Editorial of The New York Sun, March 14, 2008.

In the past, Mr. Paterson's views on eminent domain — he's been wary of a what he's called a "gold rush" in the use of state takings — didn't matter except to the degree that he was a significant voice in the Senate in Albany or lieutenant to a pro-development governor. Now, as our Peter Kiefer reports on page one, his views, with which we don't necessarily disagree, at least on eminent domain, could impact huge projects affecting New Yorkers.

In another Sun editorial, Kelo and Us: Editorial of The New York Sun, April 3, 2008 run when the question of whether the U.S. Supreme Court would grant certiori to hear Goldstein v. Pataki, the Atlantic Yards megadevelopment case that could have overturned Kelo was pending, the Sun agonized. The Sun opined that, “The stakes don't get higher, for the individuals, for the city, and for the country” and recognized a host of reasons that eminent domain was undesirable as contrary to individuals’ rights but it summed up that “no one will envy the Nine this decision.” The Sun would probably not have been agonizing if they hadn’t strayed into error with their analysis as follows:

There's little doubt that the Atlantic Yards project, which is being developed by Bruce Ratner, would bring a host of benefits to Brooklyn, such as a basketball team, housing, office space, some daring architecture, and commerce. The main legal impediment now are just a few holdouts in the neighborhood. We would like them to move, as would many New Yorkers, and make room for the project. The questions is: can the government force them out?

Atlantic Yards will NOT bring benefits to Brooklyn. People need to thoroughly appreciate that the project will be blighting and a net negative. It will sap public resources that could be properly directed. This comes about precisely because it doesn’t exemplify the kind of "limited government” in which I think the Sun wants to believe; it is an example of government interfering with more natural economic process to drain excessive resources unfairly and without bid into the pocket of a single national developer/subsidy-collector.

The Wall Street Journal in its editorial Eminent Reality had a good sense of how the results of eminent domain turn out to be uneconomic. It mentioned the use of eminent domain for Baltimore’s “much-touted Inner Harbor redevelopment” and noted that the development is an economic drain rather than an asset. I was in Baltimore two weeks ago. I am not an expert on the Inner Harbor redevelopment and I had forgotten that eminent domain was involved but the project shrieked out at us as a sadly obvious mistake. For that reason I got out my camera. We spent little time there because as soon we arrived we were desperate to leave. At the same time we observed so many areas of Baltimore with enormous potential where public resources could far more wisely have been spent. Here are the words of the Wall Street Journal editorial:

The most grandly conceived plans are also often those most likely to fail. If a project cannot proceed without government interference, it is reasonable to ask whether it is worth putting the hamfist of government on the scales at all. As the Institute for Justice's report notes, Baltimore's much-touted Inner Harbor redevelopment remains dependent on government handouts. At the same time, private redevelopments without eminent domain, such as in Anaheim's A-Town, are thriving.

September Mourn?

Recently, the Sun has run an article about the support that has emerged for its continuation, A Surge of Support for the Sun Voiced by Leaders in the City, By Grace Rauh, Staff Reporter of the Sun, September 5, 2008. Today, in another follow-up, the Sun ran 3 Governors Add Support to 'Save Sun' Effort.


September 30th, the last day of September, will be a Tuesday. By my reckoning the end of that particular day will come with Apollo taking his golden orb just below the horizon at just about 6:40 P.M. Let’s hope that when the sun sets that day the New York Sun will still be with us, feistily making us think.

Endorsements for Paul Newell for 64th Assembly District Seat

Noticing New York is pleased to note that, as of September 7th, all three New York City major papers have endorsed Paul Newell to replace Sheldon Silver: the New York Daily News, the NY Times and the New York Post. (Today’s New York Sun bridled at what it referred to as the three biggest newspapers in the state getting together and all endorse Silver’s opponent, concerned about the relative `liberalism’ of the candidates. Three Editors in a Room: Editorial of The New York Sun)

Here are links to the endorsements:

The New York Times endorsement: Endorsements for a Better Albany, August 22, 2008

The New York Daily News endorsement: Dump Sheldon Silver, Sunday, September 7th 2008

The New York Post News endorsement: Newell for Assembly, August 24, 2008

I was pleased to provide a Noticing New York introduction for Mr. Newell at his July 3, 2008. press conference about Forest City Ratner’s blackmail of Manhattan’s Community Board 1 to get increased subsidies for the luxury Beekman Tower which has been specially financed with tax-exempt Liberty Bonds. The Forest City Ratner threat was that it would not build a school the community needed if it didn't get an increase of subsides for the luxury project. This threat was possible because FCR’s provision of the school had been tangled into the special arrangements for the Beekman’s financing. In retrospect the jeopardy associated with permitting such tangles is clear.

Forest City Ratner’s blackmail was excellently covered by Julie Shapiro’s article in the Downtown Express (C.B. 1 approves Ratner’s tax break just by saying no)
and Atlantic Yards Report (Wednesday, July 02, 2008, Does Beekman “blackmail” presage AY subsidy push?)

I have made the point before that Forest City Ratner is less a developer than a subsidy collector. The takeaway from the Beekman blackmail story, a takeaway also amply evident in the Forest City Ratner machinations respecting Atlantic Yards, should be that awarding a project to a developer on a monopoly basis and then deciding afterward what the project is and what the subsidy is is bass-ackwards. Only politicians who are completely careless or worse would do so. Don't put a developer in the driver's seat expecting him to be on your side. (Ratner is never going to be on the public's side.)

This is the point Mr. Newell made about Sheldon Silver at his press conference concerning the Beekman. Mr. Newell’s press conference reminded the public that Forest City Ratner is a developer that Shelly Silver has specially favored while taking money from Ratner. The special favoring has gotten way ahead of any controls that might ensure public benefit from the developer in exchange.

In connection with introducing Mr. Newell, I noted that I am technically NOT a resident of the 64th Assembly District, but, in essence, I am from a practical standpoint. In Brooklyn our lives have been sorely affected because Shelly Silver has been willing to give Bruce Ratner a monopoly on 22 acres of Brooklyn- For 60% of that project eminent domain is an operative feature being used to abusively take private property for the purpose of creating developer windfall. Silver has been unwilling to account to the public on this and he is unwilling to back off from his mistakes. Conversely, the Atlantic Yards megadevelopment is a burden to all of the city. Atlantic Yards, as a developer-initiated and developer-driven project, has been designed to sponge up the maximum public subsidy possible. That makes it a two to three billion dollar politician’s mistake. Do you know how far that money would go if it were spread and used across the city on worthwhile projects? Only a fraction of it would be needed for Moynihan Station!

Overall, Paul Newell is paying attention to critical issues. A few days before the Beekman press conference we ran into Mr. Newell at Assemblyman Richard Brodksy's hearings at about how we are senselessly pouring in billions of taxpayer dollars of subsidies into sports complexes, not for the public benefit, but for wealthy franchise owners for Yankee Stadium and the Bruce Ratner Nets arena. Neither of us was able to get into the hearing because four busloads of construction workers had been brought in to preempt public attendance. Mr. Newell and I got to spend some time talking. Obviously, with the enorsements of the three major papers, a lot of people are really hope he will be elected, ourselves included.

ESDC’s Hearing on Use of Eminent Domain for Columbia University Expansion

Thursday night Noticing New York delivered testimony, which I am providing in this post, at the Empire State Development Corporation's (ESDC) hearings on eminent domain for Columbia University’s expansion into West Harlem.

The testimony, which is brief and confines itself to eminent domain highlights, stayed just within the three minutes allowed to those wishing to speak. (At one point I understand there was confusion about whether five minutes was going to be allowed.) I have already posted on Noticing New York a much longer and considered letter about the proposed expansion delivered as testimony when the proposed plan was being considered by the City Planning Commission.

Immediately following the Noticing New York testimony below are some additional observations about the hearing.

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Noticing New York’s Testimony
September 4, 2008

New York State Empire Development Corporation
633 Third Avenue
New York, NY 10017-6706
Re: September 2 & 4, 2008- Hearing on Use of Eminent Domain for Columbia University Expansion
Dear New York State Empire Development Corporation:

This comment is being offered in the name of Noticing New York, an independent entity dedicated to the proposition that developing New York and appreciating New York go hand in hand.

I offer this testimony in opposition to the use of eminent domain as an attorney experienced in real estate and as an urban planner.

In theory, the Empire State Development Corporation is holding this hearing to determine if eminent domain should be used for the Columbia University expansion into West Harlem. In theory, you will not treat the answer to this question as preordained. If the question is considered in a balanced and fair fashion the Urban Development Corporation doing business as ESDC will not use eminent domain.

Necessary for a fair consideration of this question are the following:

1. Do not underestimate the extent to which eminent domain will be used: Use of the threat of eminent domain IS the use of eminent domain.

2. Do not underestimate the financial value of eminent domain to the university when it acquires land at reduced prices.

3. Do not underestimate the high and unreimbursed price that is paid by those condemned in terms of unplanned for disruptions, dislocations and forced transaction costs. If the condemned defend in any way against the condemnation they will have costs. If they acquiesce to the condemnation, costs do not go away notwithstanding that the whole process is only for the benefit of those taking the land.

4. Remember that when a neighborhood is gentrifying or “unslumming,” as Jane Jacobs would say, opportunistic condemnation essentially knocks the existing community off the up escalator so that opportunities belonging to them are seized by those doing the condemnation. West Harlem, like so much of the rest of New York, is unslumming.

5. Don’t forget the economic depression forced on a community when permission to condemn is given and the threat of it hangs over a swath of the community for an extended period, in service to the convenience of the party that wants the land but only at some unspecified future time.

6. Don’t forget that value of the upzonings is an economic lure to the university but that this value does not rightfully belong to the university but to those from whom land is being taken.

7. Do not underestimate how unfair are the pre-existing and preferential relationships between Columbia, ESDC and AKRF and do not discount what it means that Columbia proposes to be drastically empowered to take land with a no-bid process.

8. Do not fail to appreciate that you are by choice unnecessarily side-stepping processes which are called for by the City Charter.

9. Other means of development are better for the community. That is originally what Columbia was considering. Is such an alternative approach now undesirable just because it would not afford as much real estate profit for the university? Last week I was in Savannah, Georgia were the technologically avant garde Savannah College of Art and Design is expanding at a far more rapid rate than Columbia. Its adaptive reuse historic preservation program houses an incredible gamut of programs. It is embraced by, enriches and economically uplifts the community rather than destroying it. Only 3 of SCAD’s 90 buildings have been built new. SCAD has not attempted to build a completely contiguous campus, but the buildings are close and that is something that is also possible here.

I also offer you herewith an article I wrote that appeared in the New York Sun which continues to be highly relevant to your considerations.

Sincerely,


Michael D. D. White

CC: Hon. David A. Paterson
Hon. Michael Bloomberg
Speaker, City Council, Christine Quinn

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Attendance and Testimony of Others at the Hearing

I can’t personally tell you too much about the entire hearing. Oral testimony was taken in four separate sessions, (Tuesday, Sept. 2 and Thursday Sept. 4: 1:00 PM & 5:30 PM sessions). I only attended the last of those. Technically the record is still open and written and e-mail comments may be submitted until 5:30 PM on Friday, October 10, 2008.

I understand that the community was out in force at the earlier sessions. A Columbia Spectator article published after the first day of hearings: Fight Against Eminent Domain Grows More Fierce, By Betsy Morais, September 3, 2008 describes the “tension in the room” as “thick” and recounts, “Of the many people who spoke at the hearing, only a handful came out in support of the University.” An article appearing in the New York Times the day after the final session I attended (Hearing on Columbia Plan Elicits Emotional Speeches by Timothy Williams) reports that most speakers who did not have financial connections with Columbia University opposed the plan. I don’t know how many of the four sessions Timothy Williams attended but this was certainly true for the session I was at, as was also commented upon by two of the community speakers.

A young woman testifying when I was there commented that she noticed that the “majority of the speakers” speaking in favor of the plan were “employed by the University” and submitted that this was “not the way to build a strong or objective case.” She suggested that the University has “repeatedly disregarded the community” and that the University’s conduct now “crowned that disregard.” Her choice of the word “majority,” was a bit of an understatement. A young man who spoke shortly after said that the “overwhelming number” of speakers in favor of the plan stood to benefit through the construction or jobs and that while this might be good for the individuals in question this “in no way justifies the project itself.” The same young man observed that the University not only had other undeveloped properties but was not being forced to declare exactly what the wanted all the land for or how they would use it. He expressed skepticism about certainty all of the expansion would be built, opining that it, whether or not it was, the University would have real estate profit.

My observation is that speakers who have business or employment reasons to speak in favor of the University plan are frequently not scintillating. Boilerplate can be stultifying. The boilerplate may brim with collected numbers but in the audience people wondered about the sense of agglomerating statistics about undergraduate overcrowding if the proposed new campus is not going to serve the undergraduates and if Columbia already had other properties available and unutilized for this purpose. The mind can also blur when speeches from members of the community ramble down emotional trails but I have rarely listened to community testimony without thinking of the “wisdom of crowds”or the sincere appreciation Jane Jacobs expressed for the insights and intelligence that come out of community hearings.

Listening to the Testimony, One Hearing Officer Preparing a Voluminous Record

The ESDC hearing was held in Aaron Davis Hall at City College. This was the same location where the City Planning Commission held its community hearings on the alternate plans for the University’s expansion into West Harlem. For that last hearing, the Hall was filled with all the commissioners of the City Planning Commission in person. By contrast, this time the official audience for the hearing was a single independent hearing officer (assisted by a stenographer) whose job it will be to produce and furnish a record to ESDC.


I think it makes a difference when the testimony itself is heard by those it is intended to inform. In the case of the City Planning Commission two of the commissioners, Irwin G. Cantor and Karen A. Phillips did not vote in favor of the University’s version of its planned expansion. Commissioner Cantor abstained, objecting to the planned use of eminent domain and Commissioner Philips, voting against the plan, offered a very detailed and difficult to refute dissecting analysis of the University’s plan as compared with what the community wanted. I’d like to think that, like me who started the hearing without a fully formed viewpoint, the Commissioners’ views were shaped by what they heard. (Commissioner Philips is the appointee of the city’s Public Advocate, Betsy Gotbaum.)

The hearing with its four sessions (and ongoing comment period ending October 10, 2008) will produce a dauntingly voluminous record. Lawyer Norman Siegel* and his firm, representing Nick Sprayregen, one of the property owners to be condemned, submitted four telephone-book- size volumes of supporting material for the record. One has to wonder how thoroughly the ESDC board will acquaint themselves with the hearing record.

(* I must mention that Norman Siegel is running for Public Advocate to replace Betsy Gotbaum, whose two terms are up. I cannot think of anyone better suited than Mr. Siegel for this position in terms of temperament, intellectual resources and values he is committed to.)

What Might Be Heard of a Translated Message?

Much of the flavor of the hearing will undoubtably be lost upon its translation into a dry transcript. I have a professional familiarity with these things though: The ESDC members will acquaint themselves with what happened at the hearing if they want to. The question is what will make them want to?

What will make them want to? That is the job the community has ahead of it. There is also the question of those who may be communicating to the ESDC decision-makers to the effect that those decision-makers really need not concern themselves with what the community expressed.

What Was Heard Outside The Hearing

As I exited the hearing, a lawyer approached me whom I knew from when we worked together on public financings when I was in government He noted the firmness of my opposition to eminent domain expressed in the hearing and observed that this did not seem representative of the “clear thinking” for which he had always known me. He said that he thought several of the points I’d made were incorrect.

I asked him what he thought I had gotten wrong. He suggested that I was wrong on the subject of below-market under-compensation of those whose property was condemned. I said that, by definition, forcing someone to take less for their property than they were willing to sell it for, forcing them to take instead what someone else said they should get for their property was to pay a price that was less than a free market price. (I recognize that potentially coming into play is a very sophisticated discussion that can be had about what economists refer to as the problem of the holdout. We did not get into this.) There is also the way in which an eminent domain takeover of a neighborhood can depress the market: one woman at the hearing session suggested that vacant properties already acquired by Columbia were having a depressing effect.

My colleague suggested that I should be content that judges in condemnation proceedings would set fair prices for property because they were independent. That, of course, presumes that condemnees hang in long enough to go through to the end of judicial process. In all the litigations I have been involved in of any sort I have found the parties weigh the uncertainty of outcomes and consider discounts on their claims because of the stress and taxing nature of the litigation itself.

I asked him about the disruptions of the lives of those from whom Columbia would take property. “For instance?” he asked. What about the difficulty of planning or running a business and trying to keep your property leased when it is under threat of condemnation. He told me that he didn’t think that any of the owners had problems leasing their properties, that they didn’t have leases. “What about Anne Whitman?” I asked. He said that Anne Whitman may have had problems with leases but that Anne Whitman had sold. I reminded him that first point I had made in my testimony was that the extent to which eminent domain is used should not be underestimated because use of the threat of eminent domain IS the use of eminent domain.

Ms. Whitman, who it was announced was agreeing to sell to Columbia in June of this year (2008) lived with these problems for a long time. In the summer of 2004 Columbia wrote Ms. Whitman telling her that while she wanted to keep her property “the scope and current development plan make this impossible.”

If you neglect to remember Anne Whitman, you are probably neglecting to include in your consideration her family members who sold property to Columbia before her. You are probably neglecting to consider a great deal, since those selling under the threat of condemnation sign gag agreements designed to remove from sight and mind much of what is going on. (The New York Times report of Whitman’s sale, Landowner Who Balked Gives In to Columbia, By Timothy Williams, June 11, 2008, said “The university did not disclose financial terms of the agreement. Ms. Whitman did not return a call seeking comment.”)

My colleague suggested that my point about the disruptions to the condemnees also needed to be reconsidered in that some of the cost of the transactions forced upon them were reimbursed if adjudicated. Admittedly, this is an anecdotal response, but the father of a friend of mine had the business he had run all his life condemned out from under him. The condemnation process setting the value went on for years. He never reestablished the business. One might suppose with his eventual compensation he enjoyed the opportunity of an early retirement that he that not otherwise been afforded but I will accept the deep bitterness of his daughter over the retirement she said he did not want as sufficient evidence that this was not a happy outcome. It was not his chosen time to retire.

My colleague suggested that the key to considering these matters was that the “good of the many should outweigh the good of the few.” I told him that I did not think that was what the bill of rights was about. This formulation is the basis in a Star Trek movie ("Star Trek: The Wrath of Khan") for the logical Commander Spock to willingly and altruistically self-sacrifice himself to save the Starship Enterprise ("The needs of the many must outweigh the needs of the few or the one.")* Aside from self-sacrifice, there are decisions where someone else’s sacrifice may be commanded, particularly in the military where this kind of balancing comes into play. I don’t see that it has ready application here.

(* A later Star Trek film, “Star Trek Insurrection,” actually deals contrapuntally with the same good of the many versus the rights of the few equation in connection with condemning a whole planet.)

We have come a long way since the Greeks, according to western tradition, invented “democracy.” In the beginning, in its pure form, “democracy” did not recognize the value of individual rights. Whatever the majority was willing to vote for was good. The early Greeks followed a practice of ostracism. Once a year the majority of Atheneans could vote for one person to be forced to leave the community for 10 years. No reason was required: if the majority voted this way this was the result. Ostracism was used surprisingly by Athenians to expel Themistocles the statesman and military hero famous for saving Athens by convincing the people to build the fleet of triremes that saved the city from the Persians. But since the time of the ancient Greeks we have come to respect individual rights: majority rule is not enough to dictate outcomes.

Even if it were a question of putting asunder the rights of individuals for the benefit of the majority, who is to say what the interest of the majority is? Given the influence of money in the process it seems that what we have operating here is not a “democracy” with the sentiments of the community controlling, but a “plutocracy” were expenditures of money dictate the outcome. Maybe “plutocracy” is not really what we are dealing with here either. Notions are pretty theoretical about how the benefit to “the many” will be greater if Columbia expands via its own preferred plan rather than that which the community wants. Given how theoretical these notions are, perhaps what we are faced with here is not the proposal that we should be governed by a “plutocracy” (or a “democracy”) but by a “philosophocracy.” (In considering this, remember that Plato envisioned the philosopher-kings ruling Kallipolis, the ideal city-state of his republic, would truth-loving.)

I asked my colleague whether he didn’t find it troubling that, rather than dealing with a discrete short-term, government initiated, defined and bid-out project that we were dealing instead with a private institution using eminent domain over decades on a schedule that would be developed and applied for the institutions own self-and-future-determined convenience.

Didn’t this make sense, asked my colleague? Didn’t it make sense that Columbia should be able to use eminent domain over time as it is needed to expand and not sooner or later? If Columbia wasn’t now sure of its plans or when (over the decades) it would be best to take the property, shouldn’t flexibility be accorded? What I wanted to know was how was it right for this flexibility to be at the expense of the rest of the community?

Why doesn’t this become a general right of condemnation on Columbia’s part? Because this is a single approved project submitted my colleague. But this covers a plan for expansion over 25 years: why 25 years of continuous expansion? What happens when Columbia continues to grow after those 25 years as it surely will? What happens then? Doesn’t it seem that the number of years has been calibrated to make seemingly reasonable Columbia’s plan to get exactly the basket of land Columbia has asked for permission to acquire?

Didn’t I appreciate this as an urban planner, my colleague wanted to know. Didn’t I think the ability to comprehensively execute such a plan with such control was a good thing?

“No,” I told my colleague. I told him that I believed another kind of community growth was better for everyone, the kind of growth that worked organically growing with the community. I said that I thought this kind of controlled planning where the conceptual “plan” or “planning” took precedence over everything was pre-Jane Jacobs. (The “Death and Life of the American City” came out in 1961.)

My colleague wished good luck to Noticing New York, which I had explained to him is relatively new.

Aspiring “Sleek?

The Timothy Williams Times article on the hearing I mentioned above
refers to the expansion Columbia proposes using the adjective “sleek.”

"If the board approves Columbia’s request for eminent domain rights in 17 acres
adjacent to the Hudson River, the area would be transformed from a low-rise,
light-industrial neighborhood with century-old buildings to a sleek,
glass-walled extension of the university’s campus that will house its business
and arts schools and a science building."

If “sleek” means shedding all ties and references to the cultural landscape from which it is emerging, Williams may have hit upon the right word. There are other ways to develop. The Savannah College of Art and Design which I mentioned in my testimony offers design curriculum about the art of taking the cultural landscape into account. As I commented, the school is fast growing and technologically avant garde. It adaptively reuses existing historic buildings and uplifts a community that adores it in exchange.

This Just In- Gyllenhaal Jilted? Squadron Pulls Ahead?

I just got this e-mail from Josh Kriegman, Campaign Advisor to Daniel Squadron. I will let it speak for itself for the moment except to point out for reference that I offered some points on what should be insisted upon in terms of effective action on Atlantic Yards (See the Brooklyn Speaks Site.) I am posting this after having just posted about the Connor vs. Squadron State senate race a short while ago. I similarly contacted the Martin Connor campaign but am still waiting for their response.

*****

Thanks for your question.

Daniel supports a moratorium on state aide for the Atlantic Yards project for three reasons which must be addressed: First, it continues to be too big for the infrastructure surrounding it. Second, the eminent domain process neither followed an official procedure nor was transparent. Third, the project increasingly looks like a bait-and-switch on affordable housing, which is a critical priority and was the silver lining in the original plan.

Moving forward, Daniel has pledged not to accept any contributions linked to the developer of Atlantic Yards so no one needs to wonder who he's working for.


Josh Kriegman
Campaign Advisor
Squadron for State Senate

Your Chance to Vote on Eminent Domain Abuse

In the run-up to the November elections, right at the end of the cycle, WNYC’s Brian Lehrer Show has regularly provided some excellent coverage in the form of “Thirty Issues In Thirty Days.” “Thirty Issues In Thirty Days” is a series of excellently produced and thoughtful discussions on topics pertinent to the unfolding elections.

This year the Lehrer show has solicited the public to help “produce” the program by nominating and voting on topics for discussion.

The nominations are now in and according to the show’s site “Soon, you’ll vote for and rank your favorites from the list, which will help craft the series.”

One of the topics now nominated, courtesy of yours truly here at Noticing New York, is the subject of eminent domain abuse.

So, if you are interested in what will surely be a very well-produced event get ready to go to the Brian Lehrer show site to vote for its discussion.

The nomination (currently # 102 submitted September 04, 2008 at10:56AM) says:

Topic: Eminent Domain Abuse

To which national party do we go to address this issue? According to polls up to 90% of Americans disagree with the Kelo decision but protections are not in place in New York, on the federal level or many other places. Abuse usually involves big corporations trampling on individual rights in pursuit of profit, the kind of thing for which we often instinctively blame Republicans but Democrats seem to have largely ceded this emotional issue to Libertarian and Republican candidates and, ironically, it is the conservative Republican judicial appointees who have been willing to uphold individual constitutional rights- The same justices who might overturn Roe v. Wade. It is a federal as well as a state issue because federal funding could require no abuse. Ratner is spending hundreds of millions lobbying against this.

Scratching My Head on Who to Vote For: Connor Vs. Squadron (Vs Gyllenhaal) the 25th District State Senate Seat

The other day I got one of those polling phone calls and spent 20 minutes answering a slew of questions about the Marty Connor/Daniel Squadron contest for the New York’s 25th District State Senate seat. (The primary is this Tuesday.) A heavy stress of the poll questions was where the candidates might be viewed in terms of over-development, taking money from developers and working for Forest City Ratner; the Brooklyn Bridge Park development was mentioned several times. I told the polling interviewer that I considered the single most important issue these days to be stopping Atlantic Yards.

Listening to WNYC last week I was sorry that I missed the Wednesday night Connor/Squadron debate when I heard that among the issues the candidates had “clashed” about was “the Atlantic Yards development.” WNYC left me hanging and didn’t tell me what they said about Atlantic Yards during the debate. “No Land Grab” picking up on the WNYC report tantalizingly summarized: “Squadron has made cautionary statements against the Atlantic Yards project in the past, but all of his heavy-hitting political backers are big-time supporters of the project, leaving many Brooklynites scratching their heads on the way into the voting booth.”- So, just as NLG described, I was still scratching my head and wondering whether anything elucidating was said at the debate.

I figured I would wait until Thursday night/Friday morning for my trusty Brooklyn Paper to come out figuring that the paper would have covered the debate. The paper’s coverage is good on Atlantic Yards.

Opening the Brooklyn Paper and I immediately found a campaign ad for Daniel Squadron. It said he is endorsed by:

1.) Chuck Schumer- Until Schumer gets it straight on Atlantic Yards I am wary of his recommendation on anything that affects local neighborhood development.
2.) Michael Bloomberg- Another major negative in my consideration
3.) Anthony Weiner- Strike three!
4.) Scott Stringer- Also not doing well in the area of opposition to over-development
5.) The Working Families Party- Given ACORN’s irresponsible conduct on Atlantic Yards that is a major downer (Of course, WFP supported Tish James for her City Council office and Tish James has done everything right on Atlantic Yards.)

When I looked harder, the paper actually covered the debate itself (Connor, Squadron dance around issues at debate, by Sarah Portock., page 5 of the print edition) but the story didn’t mention the Atlantic Yards issue. The Brooklyn Paper has endorsed Squadron.

I then looked to see what I could find in the Brooklyn Heights Courier. I didn’t find a report of the debate but on page 18, in an endorsement for Connor, I found the paper, while comparing the worth of Connor vs. Squadron, musing on the value of voting to put into the Senate Seat “actress Maggie Gyllenhaal - - a former resident of the 25th State Senate District, which includes Park Slope, Carroll Gardens, Boerum Hill, Brooklyn Heights and Williamsburg.” The endorsement did not say anything about Atlantic Yards.

Meanwhile, I had gotten mailings from a a group of my politically heavy-hitting (and Obama- supporting) neighbors telling me to vote for Martin Connor. It as if the mailing was a major effort and it might have made a difference as I attempted to make up my mind, but wouldn’t it have been easier for Connor to gain my support by just taking a strong position in favor of effective action to stop Atlantic Yards? Any candidate who distinguished himself by doing so would have had my vote easily. But months before I’d already communicated several times with Connor’s office telling him he needed to take effective action against Atlantic Yards and I was not getting satisfactory responses.

So if neither candidate is satisfactorily mobilizing to oppose Atlantic Yards is there one of them to vote for in the Tuesday primary? Is it better to vote for Squadron, a candidate who is ostensibly a reform-minded insurgent on guard against over-development who won’t prove those credentials by doing what he has a perfectly free hand to do: opposing what is obviously the worst thing happening in New York and the immediate environs of this Senate District? Unlike other problems New York City might be facing, this is one that comes signed, sealed and delivered by problem politicians. Squadron says he should be elected because he will take on important “development battles:” why won’t he prove it by addressing the poster-child? Or, is it better to vote for Connor, a 30-year incumbent who was probably taken in by the Atlantic Yards hornswaggling when it was first underway and won’t admit this now or reverse course? Then, what does it say about Connor that when David Paterson unseated him as minority leader in the State Senate in 2002, Assembly Speaker Sheldon Silver, allied himself with Connor? Silver has been quite unsatisfactory when it comes to a long list of things, with Atlantic Yards toppingthe list. We are pleased to see that Paul Newell is now out-raising Silver in his race to gain Silver’s seat and that the New York Times endorsed him, August 22, 2008, in its editorial Endorsements for a Better Albany.


Eventually, on the Brooklyn Paper web site I found a 76-minute podcast of the Connor/Squadron debate. I really didn’t hear a discussion of Atlantic Yards. Debate moderator, Dick Dadey of Citizens Union, missed an opportunity.

It is interesting that Squadron has taken a position on the development of Brooklyn Bridge Park which is less pro-development than Connor but the issues about exactly how Brooklyn Bridge Park should be developed (about 19 minutes into the debate podcast) are far less clear-cut and far less important than the multiple issues making it essential that Atlantic Yards be politically opposed.

Which candidate is better? If either one of them comes out between now and the Tuesday primary to definitely and emphatically state that they will take effective action to stop Atlantic Yards I will vote for him. My thinking about candidates who wimp out on the subject of Atlantic Yards is likely to be just as important when the general election comes up. But if I don’t get satisfaction, the musings of the Brooklyn Heights Courier have me thinking. Maybe I should write in a candidate. Maggie Gyllenhaal co-stared with Heath Ledger in “Dark Knight” and her brother Jake co-starred with Heath Ledger in Brokeback Mountain. Heath Ledger was on the advisory board of Develop Don’t Destroy Brooklyn which has been a key player in halting Atlantic Yards. Voting for Ms. Gyllenhaal sounds mighty attractive.