19 minute read
ERIC ADAMS
A fragile peace
THE WAY ERIC ADAMS talks, you’d think his expected election as the next mayor of New York City would be the biggest win for labor unions since the 40-hour workweek.
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“You should feel good because one of your own will become the mayor of the city of New York. One of your own,” Adams said to members of Construction & General Building Laborers’ Local 79 on Aug. 23 in the South Bronx. “Probably the first time in history that a union member will become the mayor.” (Not quite – John Hylan, mayor from 1918 through 1925 and William O’Dwyer, mayor from 1946 to 1950, reportedly once belonged to unions.) “I am you! I am you!” Adams said – a line that he’s been using on the campaign trail for months as he picked up the most high-impact labor endorsements in the crowded Democratic mayoral field. Adams showed love for Local 79, and the union loved him back. “He’s a hardworking guy like the laborers that we are,” Chaz Rynkiewicz, the local’s vice president, said when introducing Adams. “You guys like hard work?” A cheer went up in the orange-clad crowd.
Local 79 may have some more hard work ahead if the union wants to be on Adams’ good side. After all, the local endorsed one of Adams’ leading rivals, Scott Stringer, in the Democratic mayoral primary, and an affiliated political action committee spent $333,334 backing Stringer’s run. It’s not like Adams was tight with the union before that – he’s often criticized the city’s construction trade unions for not having enough workers of color, and he stood against Local 79 on safety training legislation and prevailing wage legislation.
Now, in the honeymoon period after the primary, everybody in labor wants to be Adams’ friend, and Adams wants to be friends with labor. But that’s easier said than done, as a number of unions will have to weigh just how hard they want to work to keep Adams on their side.
The United Federation of Teachers may also have one of the greatest challenges in cultivating the new mayor as an ally. After all, the UFT spent $3.75 million supporting Stringer’s mayoral campaign and continued spending even after decades-old sexual harassment accusations against
LEV RADIN/SHUTTERSTOCK CREDIT
A fragile peace
While most unions are eager to praise Eric Adams, New York City’s likely next mayor hasn’t always been on their sides.
By Jeff Coltin
Adams has received new union support as he prepares for the November general election. Stringer became public and most political observers stopped considering him to be a viable contender. Hindsight is 20/20, now that Adams won the primary, but it’s not as if he would have been a good fit for the union’s politics anyway. Adams has been far too accepting of charter schools for the UFT’s liking. And while Stringer was talking about putting two teachers in every elementary school classroom (read: more UFT members), Adams was postulating that, for some summer classes, one instructor could virtually teach 300 to 400 students at the same time. (Adams later walked it back.)
UFT President Michael Mulgrew said the union has some concerns about Adams’ policy positions. But the labor leader told City & State he expects a good, constructive relationship. “Especially someone like Eric who’s been here and run for so many offices and we’ve worked with him at different times – there is an understanding that politics is politics, and governing is governing,” Mulgrew said. “It is what it is. Let’s move forward.”
Adams broadly speaks a lot about government efficiency and specifically pitched a two-year hiring freeze of city workers. Plans like that scare unions, which are always looking to grow. But this honeymoon period is all about finding common ground, and Mulgrew pointed out that Adams and the UFT agree that the bureaucracy at the Department of Education has gotten too bloated. “Eric was very clear during the primary process that the Department of Education needs to be completely restructured,” Mulgrew said. “And that is something we agree with.”
A potential Adams administration and Mulgrew would also have to find agreement on a new contract relatively quickly. The UFT’s contract expires in September 2022 and neither side would likely want a drawn-out battle. Of course, the UFT has been here before – the union endorsed Bill Thompson in the 2013 Democratic mayoral primary and then had to work in Mayor Bill de Blasio’s New York. That transition was far more dramatic than this one. Then-Mayor Michael Bloomberg left office at the end of 2013 without a single municipal labor union under contract. All of the agreements had expired amid a yearslong standoff between the billion-
aire mayor and the unions he thought were stymieing progress. The de Blasio administration came in and settled all of them. In spite of some pitched battles with labor, particularly over the course of the COVID-19 pandemic, de Blasio has been considered a friend to unions – especially compared to his predecessor.
But tension is inherent in the dynamic between the municipal unions, who represent workers, and the mayor, who appoints and represents management. Members of the unions that supported Adams and helped him win – like District Council 37, which represents many public employees, and the Uniformed Fire Officers Association – are cautiously optimistic for an Adams mayoralty. But it’s still cautious, since Adams is untested in some ways. He never served on the City Council, and since borough presidents have few enumerated responsibilities, he could pick and choose his battles.
“Those who endorsed him feel good that our person is there,” said a labor operative who asked for anonymity because they weren’t authorized to speak on behalf of their union, “but you don’t really know what’s going to happen when you’re at the table negotiating dollars and cents.”
That’s not just true of municipal unions, who have to negotiate contracts directly with the city, but also private sector labor unions, who still work with City Hall on legislative and budgetary matters. It will be easier for Adams to keep allies happy that endorsed him in the primary, like 32BJ SEIU and the New York Hotel and Motel Trades Council, since he will not have to balance the city budget on their backs. But the labor movement isn’t a monolith, and sometimes Adams will have to choose among allies. The debate over Amazon’s planned headquarters in Queens pitted major labor unions against each other and forced elected officials to pick sides. Stephanie Luce, a professor of labor studies at the CUNY School of Labor and Urban Studies, said that same dynamic will be repeated as the city comes out of the pandemic. “We had tremendous job loss and the city’s trying to recover and rebuild, but it’s too early to say where jobs will recover and not,” she said. “Labor is not united on all of these issues about what kind of jobs to create.”
Another complicating factor for unions is Adams’ continued courting of business elites such as John Catsimatidis and Bloomberg, who’s hosting a fundraiser for the Democratic nominee on Sept. 15. De Blasio had a reflexive aversion to the city’s wealthiest residents – and the feeling was mutual. Now Adams, the former police officer and former Republican, has been accepted with open arms. And if labor unions sometimes find themselves at odds, there’s no question that Adams will have to choose between subscribers to The Wall Street Journal and those who read The Chief-Leader.
But there may be no relationship more closely watched than the one between Adams and the New York City Police Benevolent Association. Adams, who served in the New York City Police Department until 2006, was once a member. And it’s that membership that helps him claim solidarity with labor – nevermind the fact that there’s an ongoing debate about whether police unions even belong in the labor movement, given their consistently conservative politics. And for that, the relationship between Adams, the PBA
Things with Local 79 now seem pretty chummy, despite a rocky relationship.
and the other law enforcement unions is somewhat uneasy. Most of the NYPD unions, including the PBA, didn’t endorse a candidate in the Democratic mayoral primary. The NYPD Captains Endowment Association, which represented Adams when he moved up the ranks, was the one exception, and backed Adams’ opponent Andrew Yang. But it wasn’t clear if most candidates wanted a law enforcement union endorsement anyway, given their toxicity in Democratic politics.
The PBA and de Blasio have publicly disparaged each other throughout his term, even though progressive critics have said the mayor went nowhere near far enough in instituting reforms at the NYPD. Adams is starting off on much better footing. His platform included the need to reform the culture of the police department, but didn’t mention the union. Adams has criticized the PBA before and said he didn’t want its endorsement, but at the same time, touted support from individual officers represented by the PBA. And his pro-police platform and law enforcement résumé clearly struck a chord – he was one of the three mayoral candidates that PBA President Pat Lynch recommended to his members.
Adams’ campaign declined to comment for this story. When asked about the PBA’s relationship with Adams, Lynch listed things he thought Adams could improve. “Veteran police officers are retiring in droves and the NYPD is struggling to get people to take the test,” he said in a statement emailed to City & State – although the NYPD told The Wall Street Journal the number of police officer applicants wasn’t much lower in 2021 than 2019. Lynch said the city needs to “rethink how it recruits and retains police officers, (but) Adams has an advantage because he knows what it’s like to try to rear a family in this city on a police officer’s salary. And when he did it, the pay was much more competitive than it is today.”
The fact is, no union, even that notoriously combative PBA, will be eager to criticize Adams in the early days of his mayoralty. His stock is high and he will likely be riding in on a wave of goodwill. Adams, if elected, would be the city’s second Black mayor, at a time when some labor organizations, like the building trades and police unions, are trying to emphasize their support for Black New Yorkers and better represent their increasingly diverse membership.
“There’s a shift going on here and some of them still have some white men at the top calling the shots,” said Bertha Lewis, a progressive activist who supported Adams in the primary. “There’s a changing in the melanin of who the rankand-file members are.” Public battles with Adams would be bad optics, and the man who may be the next mayor is quick to cite the possible influence of racism in political disagreements. That puts Adams at a strategic advantage with the unions who didn’t endorse him, Lewis said. “They have to patch it up with him,” she said. For now, Adams seems amenable. Asked after the Local 79 rally what he’d do with unions who didn’t back him in the primary, Adams said they’re on his team now and he’s on theirs. “During the primary, there are intramural scrimmages. Now that intramural scrimmages are over, we’re all wearing team jersey New York,” he said. “We are the same. I’m just a straight-up union guy.” ■
Amazon’s lucky (tax) breaks
How industrial development agencies have been luring Amazon to towns across New York – and saving the company money.
By Maryam Rahaman
GROWING UP IN the suburbs of Syracuse, the fountain at the closest mall, ShoppingTown Mall in DeWitt, was lined with pennies, nickels and dimes. Nowadays, the fountain doesn’t run, and the retailers that used to be at ShoppingTown have moved elsewhere or out of town completely. For years, the only people who visited the mall were moviegoers and my mom when she had to return something to the now-closed Macy’s. To be fair, the mall was overshadowed by the giant Destiny USA, a mall formerly known as Carousel Center, closer to downtown Syracuse. Even so, it feels like an apt illustration of the transitioning economy in the central New York area – an area that still grasps for its glory days of being home to major manufacturers like General Electric Co. and the air conditioning unit supplier Carrier Global. The economy has shown improvements in the past decade prior to the pandemic, and local officials still strive for more economic development. After a long battle with ShoppingTown’s current owner, who filed for bankruptcy after leaving over $9 million in unpaid taxes, the county has bought the mall back and hopes to revitalize it with the help of a new developer.
The eternal optimism for ShoppingTown Mall echoes excitement that has certainly surrounded the entry of a much larger project with a more powerful owner, only a few miles away from the mall. In Clay, the developer Trammell Crow Company is currently turning former golf club land off of I-90 into the world’s second-largest Amazon warehouse at five stories and approximately 3.8 million square feet. Amazon has promised 1,000 jobs out of this warehouse, each paying $15 per hour.
Onondaga County Executive Ryan McMahon has called the plan a “once in a generation project.” While New York City lawmakers and activists had rejected Amazon after the retail giant chose Queens in a high-profile national search for its second headquarters in 2019, Onondaga County leaders were confident that residents of Syracuse would welcome the company. So much so that they offered the company more than $70 million in tax incentives. McMahon said offering those benefits to Amazon was a matter of course.
“You’re competing, and the reality is that there needs to be a cost-benefit analysis in every community that has an opportunity,” he told City & State. In Clay, the Onondaga County Industrial Development Agency and Amazon agreed to a payment in lieu of taxes deal where Amazon will pay the county, town and Liverpool schools $28 million over 15 years – in exchange for $70 million in waived taxes. McMahon noted that the town would have received less than $1 million in taxes from the previous property owner in the same time period. “So when you look at it, we weren’t giving up anything. We’re gaining money on day one,” McMahon said.
THE PRIMARY DECISION-MAKERS behind the hugely consequential deal in Onondaga County are a board of seven business and community leaders and professionals appointed by the County Legislature. The Onondaga County Industrial Development Agency, and local agencies like them (known as IDAs), have been at the table with Amazon across the state, using tax breaks and deals to incentivize the online retail giant to set up camp in places critics say it likely would have come to anyway.
“We have a lack of opportunities for work among many segments of our population, and that’s part of what we want to do. But in the end, we want to have economic opportunity, we want to grow the economy around here and take advantage of the attributes that we have to do that,” said Patrick Hogan, chair of the Onondaga County Industrial Development Agency and Syracuse Common Council district councilor.
Industrial development agencies are public benefit corporations and were established in New York in 1969 to help
spur economic development by offering companies deals to set up shop in their areas. In Onondaga County, for example, the industrial development agency gave incentives to eight projects in 2020, including the expansion of a dairy plant and construction of a solar power array. Board members are appointed by local bodies of government. For instance, cities often have their boards appointed by Common Council members whereas county boards are appointed by the county executive and then confirmed by the County Legislature. In total, there are currently 108 industrial development agencies in New York state. As Amazon has built warehouses across New York, the agencies have consistently offered generous tax incentives. According to the Good Jobs First tracker, which tracks Amazon deals nationwide, Amazon has been awarded more than a dozen deals adding up to about $380 million across the state, many deals involving industriLocal leaders tout jobs that Amazon brings to their regions when they give the al development agencies. In a 2021 deal with Amazon and the County of Monroe Industrial Development Agency, Amazon won its biggest New York deal where company major tax breaks. it will pay the county, town and Gates Chili Central School District $58 million over 15 years, while receiving over $150 million in incentives.
– Onondaga County Executive Ryan McMahon
State Sen. James Skoufis has worked to revive reforms of industrial development agencies.
These deals are often celebrated for bringing a windfall of revenue and jobs into communities. But some critics have asked why Amazon, one of the largest and most profitable companies on Earth, needs these incentives at all. And in those negotiations, can there ever be an even playing field as a board of local businesspeople takes on the behemoth?
Michael Greene, Syracuse Common Council councilor at-large, suggested that local industrial development agencies may benefit from an additional body to guide them when making economic decisions. “What would be helpful is if there is regional leadership that comes from the county, as well as from the economic development agency, the Chamber of Commerce – that they are able to speak up and advocate on behalf of the region to say: ‘Here’s a baseline expectation of what we think are reasonable tax rates.’”
IN MONROE COUNTY, where Amazon has started construction on a 2 million-square-foot warehouse and distribution center, what created pushback was Amazon’s choice to apply to the industrial development agency for a local labor exemption. Being approved for a tax exemption in Monroe County usually requires a project to use local labor. However, Amazon filed a waiver asking to be exempted from the requirement – a move the New York State Economic Development Council denounced. That organization represents economic development professionals, and part of its membership base is composed of industrial development agency members.
Local labor was infuriated by Amazon’s decision, protesting before the industrial development agency’s vote with “Local Jobs for Local People” signs. Ultimately, Amazon and Trammell Crow Company were granted a 30% local labor waiver, with approximately $41 million going to local contracts and about $17 million to outside contractors. Amazon did not respond to a question about the local labor waiver in Monroe County. Grant Malone, president of the Rochester Building & Construction Trades Council, was one of the main voices against the waiver. He suggested that a major differ-
The new Amazon warehouse in Clay, which is north of Syracuse, is one of the company’s largest in the world.
ence in priorities is why the agency approved the tax incentives and the labor waiver. “The boards that are approved are made up of big businesspeople in the community. And they’re in a different place than we are as far as what their values are,” Malone said. The Monroe County Industrial Development Agency did not reply to City & State’s request for a comment.
Malone’s frustrations have been echoed by others. John Kaehny, executive director at governmental transparency advocacy group Reinvent Albany, agreed that industrial development agencies are staffed largely by businesspeople with their interests being aligned with other businesses. Kaehny stated that there is little oversight of industrial development agencies and that the reporting that is required of their projects is rarely completed in full. He cited an annual report from the state Authorities Budget Office that stated out of 50 randomly selected 2018 industrial development agency projects, only five provided all of the required documents. Kaehny said that the relative lack of public understanding of these deals allows for corporations like Amazon to take advantage of tax subsidies. “It’s meat on the hook that Amazon is a giant superpredator, because they’re going in there, and they’re dealing with these local yokels at these IDAs, who are spending the public’s money. It’s a form of spending the public doesn’t understand because of tax abatement. And, you know, the results are predictable, which is that Amazon gets enormous amounts of unnecessary subsidies,” Kaehny said.
INVESTIGATING AND REFORMING industrial development agencies has been a long-standing project. But state Sen. James Skoufis, chair of the Investigations and Government Operations Committee has breathed some life back into reform. He commissioned a 2019 report with findings such as increasing debt, insufficient oversight and inadequate reporting that led to a series of reforms advanced during the most recent legislative session. Skoufis said that often, industrial development agency members skim through deals because of their focus on winning. “These are highly competitive economic development officials,” Skoufis said. “My approach here is, there comes a point where it’s better to say ‘no.’”
McMahon acknowledged that there were other scandals and issues elsewhere in the state, but believes that the Onondaga County Industrial Development Agency has made good decisions. He warned that the state Legislature often forgets local government. “If there’s a problem, certainly you need legislation to fix it, but I would always caution the state overall to use their local governments and local IDAs as a resource for what they can do better as well with their policies,” he said.
While tax subsidies from industrial development agencies will continue to be up for debate, the agencies may be able to play a key role in helping underrepresented communities with economic development. Daniel Lloyd, founder and president of the nonprofit Minority Millennials, said industrial development agencies are well-positioned to use equitable development approaches to serve businesses owned by women and people of color, citing work of the one in Babylon. “They expanded their services to provide financial, technical and legal assistance to existing and aspiring Minority and Women Business Owned enterprises and veteran entrepreneurs. This is why we are strongly advocating for additional funding, so the other 108 IDAs can follow the blueprint and Babylon can sustain its innovative program,” Lloyd wrote in an email to City & State. His suggestion may offer one way that industrial development agencies can refocus to continue their stated purpose of economic development, but he added that he doesn’t support subsidizing Amazon.
As Amazon continues to enlarge its footprint, New York’s industrial development agencies will likely have more chances to get the most out of deals with the company. “Amazon is constantly exploring new locations to support our growth and to best serve our customers,” a spokesperson wrote in an email. “However, we have a policy of not commenting on our future roadmap – stay tuned.” ■ “The boards that are approved are made up of big business people in the community. And they’re in a different place than we are as far as what their values are.”
