Crain's New York - February 25, 2013 - (Page 12)

OPINION Wise plan for public housing T he Bloomberg administration recently announced a plan to allow developers to construct apartment buildings with mostly market-rate rents at eight New York City Housing Authority sites in Manhattan. The main goal is to generate revenue to make up for what Mayor Michael Bloomberg called “decades of federal disinvestment” in the city’s public-housing stock. The knee-jerk opposition came quickly, despite the dire need to fix aging housing projects before they deteriorate further and the dismal outlook for the federal funding on which NYCHA relies. Mayoral candidate Bill Thompson said it was a “boneheaded” idea to use the land for private developments. Others said the proposed mix of the new apartments—80% market-rate, 20% affordable—should have a higher percentage of low-cost units. The criticism doesn’t hold water any better than a housing project’s leaky roof. It would be senseless to build new public housing while the city’s 178,000 aging units fall further into disrepair. It’s far cheaper—and less disruptive to residents— to fix and maintain apartments than to build new ones. And the mayor’s plan generates nearly 900 permanently affordable units, all privately built. As for the notion of making more than 20% of the units affordable to low-income families: That’s great as far as it goes, which is not very. If NYCHA demanded that half the units be affordable, it would get no bids and therefore no CRAIN’S ONLINE POLL units at all. For that matter, any increase in the 20% figure would result in less revenue to repair existing public housing. And revenue is desperately needed. NYCHA needs $6 billion just to catch up on work that has been missed in the past five years. Its current level of capital funding is only about $250 million a year, most of which comes from the increasingly tight-fisted federal government. Rather than catching up, the authority is falling behind by more than $1 billion every year. Doing nothing is not an option. But this would be a good plan even if the city didn’t need a dime. It is a chance to diversify and improve properties designed decades ago in a way now widely recognized as ghastly: lacking streetscapes, concentrating poverty in a self-reinforcing manner, wasting space with ugly parking lots, and compelling residents to trek through lonely, storeless landscapes to reach their inward-facing buildings. Federal approval for the city’s smart plan won’t come before 2014, meaning it will fall to the next administration to carry it out. The mayoral candidates must pledge to do so, rather than trying to score headlines with cheap-shot criticism. How to repair projects and improve their ghastly design COMMENTS A shot at nonunion hotels LIU’S MARRIOTT AUDIT SHOULD THE CITY ALLOW LUXURY TOWERS ON PUBLIC-HOUSING SITES? Yes. It’s the best way to raise money to fix public housing. No. It’s wrong to house rich people on land set aside for the poor. Date of poll: Feb. 20 168 votes 36% Yes 64% No FOR THIS WEEK’S QUESTIONS: Go to www.crainsnewyork.com/poll to have your say. 12 | Crain’s New York Business | February 25, 2013 The audit by Comptroller John Liu (“Liu targets city’s Marriott Marquis lease,” CrainsNewYork .com, Feb. 12) contains a fascinating story of institutional failure and systemic problems in how the city does business, but should be seen as an attempt by an ambitious politician to buttress his support on the left and feign the cry of “victim” on behalf of the public. Based on an interpretation of agreements signed between the Empire State Development Corp. and the hotel in 1982 and 1998, the audit reads like an attempt to drag Marriott through the mud and shake down its flagship Times Square hotel for a massive sum— which the report itself admits is largely uncollectible, the statute of limitations having expired more than seven years ago. It is also a shot across the bow of any hotel whose employees think they have the right not to be compelled to join a union, as the Marriott Marquis has long been known as a nonunion standout in an industry with a strong organized-labor presence. The renowned political “ground game” of the Hotel Trades Council would be a major asset to any mayoral bid, and by Mr. Liu’s releasing such an audit at this formative point in the campaign, it seems he is doing his version of Christine Quinn’s attention-grabbing New York magazine cover photo. Nowhere does the audit mention the underlying problem: the thicket of quasigovernmental entities that have become an integral part of doing business in the state. These entities, including the Empire State Development Corp. and the scores of industrial development agencies and similar authorities, have special privileges and exemptions (notably from property taxes) that invite abuse. Their stategranted power, and the practice of cutting deals such as PILOTs and leases—those mentioned in the audit being a perfect example—destroys even the possibility of a level playing field upon which businesses can compete. As long as this continues, losses such as those alleged by the comptroller’s report will be borne by the people of the city and state of New York, rather than by shareholders and businesses that have risked their capital in the marketplace. —paul hanson Floral Park, N.Y. A TAX BY ANY OTHER NAME Your Small Business Report (“Getting squeezed from all sides,” Jan. 21) referred to “fines” for failing to provide employee health insurance per Obamacare. I’m confused. Didn’t Chief Justice John Roberts call it a tax? I guess it doesn’t matter—it winds up in the same place. —joe marcogliese South Salem, N.Y. CRAIN’S WELCOMES SUBMISSIONS to its opinion pages. Send letters to letters@crainsnewyork.com. Send columns of 475 words or fewer to opinion@crainsnewyork.com. Please include the writer’s name, company, address and telephone number. CRAIN’S NEW YORK BUSINESS editor in chief Rance Crain publisher, vp Jill R. 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All rights reserved. ®CityBusiness is a registered trademark of MCP Inc., used under license agreement. CRAIN COMMUNICATIONS INC. BOARD OF DIRECTORS chairman Keith E. Crain president Rance Crain treasurer Mary Kay Crain Cindi Crain executive vp, operations William Morrow senior vp, group publisher Gloria Scoby group vp, technology, circulation, manufacturing Robert C. Adams vp/production, manufacturing David Kamis chief information officer Paul Dalpiaz founder G.D. Crain Jr. (1885-1973) chairman Mrs. G.D. Crain Jr. (1911-1996) secretary Merrilee Crain (1942-2012) http://www.crainsnewyork.com/subscribe http://www.crainsnewyork.com/advertise http://www.crainsnewyork.com/events http://www.crainsnewyork.com/poll

Table of Contents for the Digital Edition of Crain's New York - February 25, 2013

IN THE BOROUGHS
IN THE MARKETS
THE INSIDER
BUSINESS PEOPLE
OPINION
ALAIR TOWNSEND
GREG DAVID
REPORT: DIGITAL NY
THE LIST
CLASSIFIEDS
FOR THE RECORD
REAL ESTATE DEALS
SMALL BUSINESS
NEW YORK, NEW YORK
SOURCE LUNCH
OUT AND ABOUT
SNAPS

Crain's New York - February 25, 2013