ASIAN AMERICANS envision new districts, right, in the future (Page 8), the LOWER MANHATTAN DEVELOPMENT CORPORATION is past its prime (Page 10)
Vol. 5, No. 11
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May 23, 2011
and CAROL KELLERMAN, left, picks apart the city budget (Page 23).
How the city’s fight with the teachers signals larger troubles with labor pg. 12 ANDREW SCHWARTZ/DANIEL BURNSTEIN/PHOTO ILLUSTRATION
And In The GOP Corner…
that preclude your thinking of running?
Ex-NYPD Boss Bill Bratton mulls a 2013 run for mayor
F
rom the day former police commissioner Bill Bratton moved back to New York from Los Angeles, he has reveled in speculation that he may want his old job back—unless his real goal is to be mayor. In these highlights from an exclusive interview with City Hall’s sister paper Our Town, Bratton talks about the appeal of both jobs.
vote on the issues at hand. So who knows what the issues will be in 2012 and 2013? They, I think, really do vote on the personality…versus, as you look at the field of candidates who have at least professed an interest, they are all, I think without exception, career politicians. Our Town: If Kelly ran for mayor, would
Bratton: We would end up neutralizing each other to some degree. Yeah. He certainly, in the city, has the more contemporary, well-known name and contemporary successes keeping the city safe post-9/11, continuing to reduce crime during that time—so in some respects that would be some degree of neutralization. —Megan Finnegan mfinnegan@manhattanmedia.com
“If I were to look at it, I think I would have the name recognition.” Bill Bratton 100%
Our Town: You’d have to run for mayor as a Republican, right? Bill Bratton: Oh, yeah, you could not— well, actually, you could be tempted to run as a Democrat, I would think, because there’d be so many candidates running that you could effectively, possibly, get in the runoff with 15 percent of the vote. You possibly—just on name. And this is with a big head start [the way] that [NYPD Commissioner Ray] Kelly would have [a head start]. If I were to look at it, I think I would have the name recognition.
ANDREW SCHWARTZ
UPFRONT
Bloomberg’s Approval Rating Since 2001 73% (March 8)
74% (May 23)
75% (March 12)
62%
80%
64% (March 24)
(March 27)
57% 47% (March 31)
(May 21)
48%
60%
(March 2)
40% (May 11)
32%
40%
(May 7)
Our Town: Will the city be looking for a leader who’s not a career politician? Bratton: Voters I don’t think vote—well, the majority of them don’t vote—on the rigidity of ideology. I think they really do
20%
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
0%
(Quinnipiac University Polling Institute)
Calendar (May 23–June 14) Citizens Union “Spring for Reform” fundraiser, 80 5th Ave
Memorial Day
“Preparing for the Next Building Boom” breakfast with Buildings Commissioner Robert LiMandri, Baruch
Election-law attorney Jerry Goldfeder’s birthday
Special election in NY-26 Congressional district
City Council stated meeting
ABNY breakfast with ESDC CEO and president Kenneth Adams, Hilton New York
N.Y. Post reporter Brendan Scott’s birthday
2
MAY 23, 2011
Mayor Michael Bloomberg’s deputy press secretary Jessica Scaperotti’s birthday
1
2
Former Public Advocate Betsy Gotbaum’s birthday
Fund-raiser for Council Member Mark Weprin, Milberg LLP
Sen. Mike Gianaris staffer Mike Murphy’s birthday
New York State Conservative Party annual fund-raising dinner, Sheraton Hotel
23 24 25 26 27 28 29 30 31
M T W Th F
Personal Democracy Forum, NYU Skirball Center
Manhattan Borough President Scott Stringer press secretary Audrey Gelman’s birthday
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S Su M T W Th F
4
5
6
7
ESDC communications director Warner Johnston’s birthday
8
9 10 11 12 13 14
S Su M T W Th F
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UPFRONT Forgotten Introductions Council Member Larry Seabrook once infamously submitted an expense report for a $177 bagel—but he hasn’t found time to introduce a single bill. Since winning election to new terms in 2009, neither the federally indicted Seabrook nor Council Majority Leader Joel Rivera has proposed any legislation, according to Council records. By contrast, Council Member Gale Brewer, who chairs the Government Operations Committee, has submitted a whopping 46 bills, on topics ranging from improving the safety for nail-salon employees to requiring motion detectors in commercial buildings. (Only two have passed.) Brewer is to the left on the political spectrum, but believing in activist government does not necessarily equate with being a prolific bill introducer. Democrats Seabrook, Rivera, Darlene Mealy and James Sanders, Jr. have introduced a total of two bills. Meanwhile, libertarian-leaning Republican Dan Halloran has introduced a middle-of-the-pack eight bills. Beyond political beliefs, bill-introduction numbers can hinge on a Council member’s engagement with the job, said one member of the body. “None of those names at the bottom of the list surprise me,” said the Council member. “Sometimes things can be explained by ideology, and sometimes they can’t.” Council Member Peter Vallone, Jr., a conservative Democrat, clocked in with the second-highest
Top Five:
46 Gale Brewer
39
33
Peter Vallone, Jr. Jessica Lappin
0 Larry Seabrook
0 Joel Rivera
1 Darlene Mealy
bill-introduction total. Vallone attributed his tally to a slew of anti-graffiti legislation and other bills stemming from his chairmanship of the Fire and Criminal Justice Committee. “Unfortunately, this now means my staff will now
O
4
MAY 23, 2011
ANDREW SCHWARTZ
n a warm evening this month, a halfdozen men sat around sheaves of blueprints at the Buildings department’s downtown headquarters, arguing the fine points of a renovation project late into the night. It was progress. Their application is one of many developments around New York stalled by conflicts Developers and architects representing the and delays inside and among the half-dozen agencies Blue School work with a city official during that must sign off on new construction—but a new a meeting at Buildings Department offices. The “Get It Done. Together.” program aims to cut DOB after-hours program gave them a one-stop shop red tape by putting all the decision makers in a room to work it out. “I hear from developers all the time, ‘The Buildings for three hours a night, in a different borough every department says yes, but the fire department says no,’” night of the week, so applicants like Simon Bogigian— said buildings commissioner Robert LiMandri. “How part of the team building the Blue Man Group’s “Blue do you get us to speak with one voice? If we hold School”—can get approvals. “This meeting is a gift,” Bogigian said. “We have a someone like that hostage because we can’t agree, very, very ambitious schedule because we hope to be that’s not right.”
Publisher/Executive Director: Darren Bloch
Lew Fidler
31 Oliver Koppell
Bottom Five:
Building Relationships
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1 Peter Koo
James Sanders, Jr.
remind me that they’re working harder than anyone else,” Vallone said on learning of his well-placed spot on the Council’s hierarchy. —Chris Bragg and Jeff Jacobson cbragg@cityhallnews.com
open in September.” LiMandri beamed: “If you had to do this through normal processes, you’d be here in August.” Around them, representatives from six agencies sat in front of laptop computers, ready to resolve code disputes on site. A DOB plan examiner sat next to an expert from higher up in the department so he could get a supervisor’s backing immediately. Everywhere, architects and planners and developers saw delays melt away. “Every night for the month of May we’ve got a commitment from six other agencies to have people here who can make a decision on the fly,” LiMandri said. “We should be able to approve a lot of building permits by the end of May.” That’s good news for an industry still struggling to recover from the recession, in which financing is just one of the barriers to getting construction moving again. “There’s plenty of room for improvement,” said Richard Anderson, president of the New York Building Congress. “It doesn’t sound like window dressing. It sounds like a real effort to make things better.” —Adam Lisberg alisberg@cityhallnews.com
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Life Support Living-wage backers seek to scale back bill following pushback By Chris Bragg
T
he living wage bill is undergoing a bit of a mid-life crisis, following fierce resistance from some unexpected opponents. Proponents of passing a living-wage law cast this fight as one between the city’s wealthy and its struggling lower class, just as they did for the paid sickleave debate. But opponents of both measures are wising up, seeking to broaden their ranks to include not only small business leaders but also affordable housing, nonprofit and cultural groups. “It’s much bigger and it’s much broader than the paid sick-leave coalition,” said Jack Friedman, president of the Queens Chamber of Commerce, who also fought the paid sick-leave bill. Living-wage proponents are scrambling to line up enough sponsors to get a veto-proof majority and win speaker Christine Quinn’s support. Even supporters of the bill acknowledge that the legislation in its current form may have veered from its original intent. At a May 12 hearing on the bill,
Council members who had signed on to the bill repeatedly told witnesses testifying against it that the livingwage mandate was not ever intended to cover their particular industry or development but was mainly designed to target big developers like Related and Vornado. Paul Sonn of the National Employment Law Project, who is often credited with writing the bill, said that an initial draft was actually written by Council Member Oliver Koppell’s staff, and that the language remained in the legislation even after it was amended earlier this year. A city Economic Development Corporation-backed study recently concluded that the law would devastate job growth and development in the city. A provision mandating that a developer or tenant pay a living wage after receiving $100,000 in city subsidies ended up affecting a broad swath of “as of right” projects around the city beyond the bill’s original targets, which were large mixed, multi-use developments such as Willets Point. Still, Sonn believes the study would have cast a negative light on the livingwage bill, regardless. “Spinning the proposal if it had been more narrowly focused and narrowly crafted would have been harder,” Sonn
said. “But clearly they were trying to steer the debate in one direction.” With the EDC-funded study on living wage already complete, the question is whether the new amendments will come too late in the game. The Retail, Wholesale and Department Store Union, one the bill’s main
“Spinning the proposal if it had been more narrowly focused and narrowly crafted would have been harder,” said Paul Sonn of the National Employment Law Project. “But clearly they were trying to steer the debate in one direction.” drivers, is focusing on lobbying seven fence-sitting Council members: Queens Council Members Leroy Comrie, Ruben Wills and Mark Weprin; Brooklyn’s Erik Martin Dilan and Diana Reyna; Jimmy Vacca of the Bronx; and Jessica Lappin of Manhattan. The bill currently has 29 cosponsors, and needs 34 to have a vetoproof majority. Some of these Council members privately expressed skepticism about the bill, and said they are waiting to see what kinds of amendments are eventually attached. Living-wage supporters believe their
Lost In The Stacks
Bloomberg pushes records-agency merger, librarians push back By Laura Nahmias
N
Andrew SchwArtz
ew York’s librarians and archivists will not be quiet: They’re raising their voices to keep the city’s records agency independent. The Bloomberg administration wants to fold the tiny Department of Records & Information Services (41 employees, $5.6 million budget) into the mammoth Department of Citywide Administrative Services (2,400 employees, $1.2 billion budget) in what it says would be a costsaving measure. The projected savings would be minimal, however, and civic-minded New Yorkers fear it would endanger priceless artifacts from the city’s history— putting them in the hands of an agency more focused on buying supplies and managing office space than preserving
6
MAY 23, 2011
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best bet is to sell the New York bill as similar to a Los Angeles law that passed in 1999. At the hearing, even conservative Republican Council Member Dan Halloran expressed some admiration for that program. Council Member Brad Lander, one of the co-chairs of the Progressive Caucus, said mandates on those receiving subsidies from the ICAP program, 421-a and the J-51 tax abatement would likely be stricken from the bill, as might mandates on industry. The $100,000 threshold will likely be raised. Lander said there was nothing wrong with taking a broader piece of legislation and molding it through the committee process. “Can you make the argument that a narrower bill would lead to a more focused hearing? I guess so,” Lander said. “But I didn’t hear anyone making the argument that the Yankees or Related can be making millions of dollars and still be employing people that are on food stamps.” Still, skepticism remains among opponents of the bill, even outside the real estate industry. The Bloomberg administration, leaders of the five boroughs’ chambers of commerce and even some people from the affordable-housing world say they can’t see any acceptable deal being struck. “They’re basically looking to write a bill that applies to Related, Vornado and Forest City Ratner,” said one lobbyist working against the bill. “I’m not sure you can draft a bill that just applies to those specific developers.” cbragg@cityhallnews.com
historical documents. “As a small subdivision of DCAS, no one will pay any attention to DORIS whatsoever. They’ll simply be janitors to the city’s records,” said NYCivic founder and president Henry Stern, the former city parks commissioner. “This is one instance where the little fish does not deserve to be swallowed.” The agency was created in 1977 at the request of then Mayor Abe Beame to bring the City Hall Library and the municipal archives under one roof. Its first commissioner, the late Eugene Bockman, rescued the original architectural drawings of the Brooklyn Bridge from construction workers using them as blueprints in the 1970s. DORIS now maintains nearly one million cubic feet of papers documenting every city administration since the 17th century, along with photographs, marriage records, birth and death certificates, maps and other artifacts. The papers live in treated gray boxes under the Surrogate’s Courthouse near City Hall and in other locations around the city. Among the treasures: the receipt Walloon Peter Minuit got when he bought the island of Manhattan from the Lenape Indians for the equivalent of $26 (sale
CITY HALL
“The Department of Records is the caretaker for the history of the city. Why would you want to merge it into the agency that orders your printer toner and snow tires?” said Brian Andersson, former commissioner. vists, always ready with a footnote, recall then Mayor Rudolph Giuliani proposing an identical merger in 1995, then trying to outsource the storage and care of city records to a private company. Well-organized supporters, such as the New York Civil Liberties Union, and good-government groups fought both initiatives successfully. It was not until Giuliani had been out of office several months that the public officials realized he’d left with a sizable portion of his own records, which he locked in a Queens warehouse. “It took a lawsuit to bring them back,” remembered City Council Member Gale Brewer (D-Manhattan). She introduced Mayor Michael Bloomberg’s merger bill this year at his request, but was unimpressed by the idea after a
Andrew SchwArtz
date: May 24, 1626). “It is just a mistake for so many reasons, on so many levels,” said former DORIS commissioner Brian Andersson, who left the agency last year and has not been replaced. “The Department of Records is the caretaker for the history of the city. Why would you want to merge it into the agency that orders your printer toner and snow tires?” Andersson, a genealogist who once did Today host Matt Lauer’s family tree on-air, said valuable documents used to disappear from the city’s archives before there was a single agency dedicated to preserving them. In the clutches of DCAS, he said, that history could once again wither from lack of funding, attention and security. The new city budget recognizes no cost savings from the merger, the Independent Budget Office says, but a spokesperson for DCAS commissioner Edna Wells Handy said the merger would allow the archives to expand into unused space controlled by the larger agency. “It is about the administration’s efforts to do things better, to initiate collaboration where logical efficiencies exist,” said spokesperson Matt Gorton. “The planned merger allows DORIS to focus on its core function and maintain its unique identity within civic life, while benefiting from the administrative resources DCAS can bring to bear.” That argument isn’t exactly new. Archi-
hearing. “What’s the point of this? It saves almost nothing,” Brewer said. “Not only
does this streamlining not do anything, it could harm something that’s so precious.” lnahmias@cityhallnews.com
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For more information, contact: Richard Weiss at 212-452-9427 or Joe Cestaro at (212) 452-9303 or by email at jcestaro@gnylecet.net Please RSVP to: Joel Park at (212) 450-7300 or by email at jpark@bermangrp.com REGISTRATION IS COMPLIMENTARY Greater New York LECET is a jointly managed trust fund for the Mason Tenders District Council and its 1500 signatory contractors. Our mission is to generate business opportunities for union contractors and job opportunities for LIUNA members. To accomplish its mission, Greater New York LECET focuses its resources and efforts in four key areas: Research & Business Development, Industry Promotion, Legislative & Government Affairs and Responsible & Fair Contracting.
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MAY 23, 2011
7
Possible Asian-majority districts, after redistricting Northeast Queens Assembly districts: 64.1% (gray) and 53.1% (teal) Asianmajority
Flushing Assembly Asian Majority
district:
Sunset Park and Bensonhurst Assembly district: 51/6% Asian-majority Elmhurst and Jackson Heights Assembly district: 51.5% Asian-majority
52.4%
Jamaica and Richmond Hill Senate district
BENJAMIN SMITH
Eastern Promises Will redistricting yield more Asian-majority districts? Many are counting on it. BY COLIN CAMPBELL
A
sian-American community organizations are excited by a clear trend in the 2010 Census results: the potential for a bigger piece of the political pie. New census figures indicate Asians have been the fastest-growing of any major ethnic group in New York City over the last decade, which could earn them more representatives in Albany and Washington. “If there’s an opportunity to increase representation, it’d be great,” said Council Member Margaret Chin, who represents Chinatown. “It’s also about fighting for programs and resources that are important for the Asian-American community, immigration services and language services.” The state Legislature must redraw boundaries for Congressional, Assembly and State Senate districts before next year’s primary elections. Gov. Andrew Cuomo claims to want to reform the redistricting process, and Mayor Michael Bloomberg is challenging what he says is a census undercount, but Asian-American groups are already looking to make the
8
MAY 23, 2011
most of the new numbers. A City Hall analysis of the new electoral landscape reveals that many new majority-Asian districts are possible. That includes three Assembly districts stretching across Elmhurst, Jackson Heights and Flushing in Queens; a Senate district centered in Flushing; and an Assembly district bridging Sunset Park and Bensonhurst in Brooklyn. A plurality–South Asian Assembly district can also be drawn in the centralsouthern Queens neighborhood of Richmond Hill, which has one of the city’s highest concentrations of South Asians but is now divided between five different Assembly districts. The dearth of representation at the state and national levels is a concern for many in the community, especially when it comes to receiving government aid. “We get less than one percent of government funding, so there’s a great disparity in the number of services,” said Assembly Member Grace Meng (D-Queens), New York’s only Asian state legislator, who represents the bustling Asian neighborhood of Flushing. Asians are better represented in city
government, where Chin and Flushing’s Peter Koo serve on the City Council, and Taiwan-born John Liu is comptroller— the first Asian elected to citywide office. Still, Asian-American leaders say that’s not enough for an ethnic group that now comprises almost 13 percent of New York’s population—adding more
“Some neighborhoods will be cut up,” said Glenn Magpantay of the Asian American Legal Defense and Education Fund. “We recognize that we’re not going to win everything. But last time, we didn’t win anything.” than 250,000 residents over the last decade. While the city as a whole grew only 3.7 percent, census figures show the Asian population surged 32 percent. “The number of Asian-American elected officials is woefully unrepresentative compared to the population as a whole,” said Glenn Magpantay, director of the
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Democracy Program at the Asian American Legal Defense and Education Fund. “Some neighborhoods will be cut up,” he said. “We recognize that we’re not going to win everything. But last time, we didn’t win anything.” While the federal Voting Rights Act prohibits politicians from diluting minority votes through redistricting, advocates are well aware that any new district for an emerging ethnic group comes at the expense of an incumbent politician holding that seat. That’s one of the reasons the maps inevitably lead to lawsuits—and why Asian groups are bringing early pressure to get their share. “In 2000 there were people talking about redistricting and trying to get the word out, but it was very uncoordinated,” said Rachana Shah, a volunteer and mapmaker for Taking Our Seat, an organization that aims to eventually achieve a South Asian-majority Assembly seat. “There wasn’t really a coordinated voice.” Several Asian elected officials and community organizations emphasized that their goal is not merely electing Asians to office but getting more government support for their social services and neighborhood needs. “It’s not necessarily about drawing Asian-majority districts or getting Asians elected into the Legislature,” said James Hong, the civic participation coordinator for the MinKwon Center for Community Action. “It’s about community empowerment.” editor@cityhallnews.com
CITY HALL
Crossing The Limo Line Black-car drivers aim to organize to fight alleged Wall Street abuses By Chris Bragg Deep in the canyons of Wall Street, a group of idling black-car drivers gathers each night and finds a way to pass the time, waiting for the Wall Street bankers they will anonymously shuttle home to emerge. Some read newspapers. Others try to catch some shut-eye. Mostly the drivers complain to each other about other drivers and the underhanded tactics employed by colleagues in an increasingly crowded field, in which getting two or three jobs a day counts as lucky. “The whole conversation is, ‘He said that,’ or ‘He did that to get this job,’ ” said Muhammad Barlas, who has been driving black cars for two decades. “Or ‘This guy pulled the slip on me.’ ” But as Barlas drove past Exchange Place one recent rainy night, the 52-yearold Pakistani immigrant said it was time to instead direct the rage outward. Barlas and many other drivers say that even as Wall Street has roared back to record profits, the big banks that black cars rely on for business have increasingly been pitting companies against one another, continually slashing the amount drivers are paid. On a good night, drivers say they can head home with $150 to $200 in their pockets. On a bad night, they can spend an entire shift waiting for a call that never comes. About a month ago, the directing business representative of the International Association of Machinists and Aerospace Workers District 15, Jim Conigliaro, Sr., quietly launched an effort to unionize the 10,000-car industry. He hopes to win an agreement through collective bargaining that mandates a minimum industrywide rate Wall Street firms must pay for rides. Conigliaro has tried and failed to unionize the industry before. This time, though, he sees a better chance to succeed, and has already received hundreds of calls from rank-and-file black-car drivers who want to get involved. Though Wall Street and unions have often clashed over who should bear the brunt of the recession, rarely has the conflict been presented as starkly as the one brewing between financial titans and the largely immigrant black-car workers. At first glance, black-car drivers and Wall Street bankers share some similar characteristics. Both wear suits and ties. Both incessantly check their BlackBerrys for assignments from their bosses. But when it comes to compensation, their
CITY HALL
Muhammad Barlas is among a group of black-car drivers trying to organize the industry.
Andrew SchwArtz
paths diverge sharply. Khalid Imran, a Pakistani immigrant who has been in the business for more than two decades, bought a “franchise” for $80,000, which provided him a dispatcher who had contracts with Wall Street firms that spend tens of millions of dollars annually on black cars. Yet over the years, Imran says, his franchise has become virtually worthless. The number of black-car companies has grown exponentially, from only a handful to more than 100. Unlike the taxi industry, there is no limit on the number of franchises that can be sold. And unlike livery cars, which can take cash, black-
three rides in a night. “When I see the future, I see blank,” Imran said. “I see nothing.” The National Labor Relations Board considers drivers to be employees of their black-car dispatcher, which gives them the option to unionize. In practice, pretty much every overhead cost in the business—from the black car itself to insurance to a monthly fee for dispatch services to tickets issued by the Taxi and Limousine Commission—is footed by the drivers. With all the overheard expenses, many drivers report pulling in less than $25,000 a year, with no health-care or pension benefits, even as they often stay
Though Wall Street and unions have often clashed over who should bear the brunt of the recession, rarely has the conflict been presented as starkly as the one brewing between financial titans and the largely immigrant black-car workers. car drivers rely exclusively on being paid through vouchers, which are issued largely through Wall Street banks. The proliferation has allowed Wall Street firms to pit the companies against each other and pay drastically reduced rates, drivers say. Lack of business has led drivers to take extreme measures, such as buying their customers small gifts like fruit baskets, in the hope that their car number will be specifically requested in the future. Imran says that while once he had enough work to keep him busy at all hours, he is now lucky to give two or
on call some 15 hours a day. But challenges wait. Many of the drivers are recent immigrants worried about eking out a living and unschooled in the methods of labor organizing. Punishment from the black-car companies can also be swift if drivers step out of line, Conigliaro alleged, with drivers blackballed from getting calls from their dispatcher if they challenge management. “We’re going to have to convince people that it’s not about what you make this week—it’s about having a future,” Conigliaro said.
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Ira Goldstein, executive director of the Black Car Assistance Corporation, an industry trade group, declined to comment. It is likely to be an uphill battle. The powerful building-service workers union, 32 BJ, has been trying to organize security guards at Wall Street firms—who in many ways also act as independent contractors—for most of the past decade. Yet the union has only had mixed success, because banks can simply hire nonunion security firms, said Kathryn Wylde, president and CEO of the Partnership for New York City. This fate could also befall existing black-car companies if the industry unionizes, she said. “There are no barriers to entry into the business,” Wylde said. “The little guys keep undercutting each other—and the financial industry goes with what’s cheaper.” Conigliaro first tried to organize black-car drivers in 1999, but found after unionizing several companies that banks would simply switch to nonunion labor. This time Conigliaro, who is also a candidate to become the next president of the city’s powerful Central Labor Council, is taking a more gradual approach. He is first attempting to convince rankand-file drivers at over 100 black-car companies to go ahead with unionization together, believing the campaign will take six to eight months—and that outrage has grown to the point that, this time, it will work. “It’s simply become a race to the bottom,” Conigliaro said. “They buy a job. But indentured servitude is really what it is.” cbragg@cityhallnews.com MAY 23, 2011
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LMDC TIMELINE • Port Authority and New York City formalize building plan for WTC site • Lawsuit over developer Larry Silverstein’s insurance payout is finally settled, clearing the way for redevelopment of several tower sites • LMDC reaches agreement with Deutsche Bank to buy and demolish damaged building at 130 Liberty Street
• Towers are destroyed • Gov. George Pataki and Mayor Rudolph Giuliani create LMDC
2001
2002
• LMDC Chairperson John Whitehead resigns, replaced by Rampe • Pryor resigns as LMDC president • Scaled-back plans for memorial released • Pataki calls for LMDC to disband
2003
• Congress appropriates $2.7 billion in HUD block grants for rebuilding, $2 billion to go directly to LMDC • First designs for WTC rebuilding are are widely panned
2004
2005
• LMDC president Louis Tomson resigns, replaced by Kevin Rampe • Mayor Michael Bloomberg’s administration calls for an increased city role in WTC redevelopment
2006
2007
• Rampe resigns as LMDC president, replaced by Stefan Pryor • Bloomberg and Pataki create Lower Manhattan Construction Command Center to oversee construction work in area
• Two firefighters die battling blaze at 130 Liberty Street, investigations reveal widespread failure to follow safety rules and enforce laws • New Gov. Eliot Spitzer names David Emil as LMDC president and Avi Schick as chairperson
2008
2009
• Port Authority Executive Director Chris Ward acknowledges that rebuilding targets are not being met, sets new schedule for completion • Bloomberg calls for LMDC to disband
• 130 Liberty Street is finally demolished • WTC memorial is slated to open on 10th anniversary of attacks
2010
2 0 11
• LMDC seeks proposals from arts groups to help spend $300 million in remaining funds
• Freedom Tower, renamed One World Trade Center, rises above ground level
LMDC Lives! Despite numerous calls for its closure, Lower Manhattan Development Corporation slogs on BY LAURA NAHMIAS
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avid Emil, president of the Lower Manhattan Development Corporation, was outnumbered. In a darkened conference room, flanked on all sides by disgruntled members of Lower Manhattan’s Community Board 1, Emil gestured toward a screen flashing eight-digit numbers as he tried to explain where more than $2 billion in federal disaster-relief money had gone over almost 10 years. Why, the board asked, were millions of dollars in job-recovery funds not yet spent? Why, they wondered, did the LMDC, with a $3 million annual staff payroll, not yet have a plan to finish its work, close up shop, and cease to be? “I agree it’s taking too long,” Emil said. The LMDC is the agency that refuses to die. It was supposed to close its doors after it finished its work of rebuilding downtown after 9/11. Yet the joint citystate agency created by Gov. George Pataki and former Mayor Rudy Giuliani in the weeks after the attacks says it is still beset by insurance squabbles, lawsuits and planning obstacles that require it to stay in business. Congress eventually earmarked more than $3.4 billion for redevelopment at the World Trade Center site. Planning
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a monument, commercial center and memorial in the middle of a major metropolitan area is no easy task. But by 2003, the agency was already under attack for moving too slowly. Mayor Michael Bloomberg and Governors Pataki, Eliot Spitzer and David Paterson have all called for the LMDC to disband. (Gov. Andrew Cuomo is reportedly still reviewing the agency’s functions.) But it will be “several years” before the agency can close, said Emil, who offered to resign in December but agreed to remain in the post at a salary of $1 per year. The authority will have just $8 million left in its coffers after this budget year, said LMDC spokesperson John DeLibero. LMDC staffers argue that the agency can’t go out of business until all of its grant money is spent. That includes more than $45 million for a proposed performing-arts center, more than $143 million in job-creation and retention money controlled by the state, $17 million in “cultural enhancement” funds for community groups and $3.2 million for a drawing and art center. They also say LMDC must stay in business while it defends a lawsuit from Bovis Lend Lease, one of the contractors that oversaw the fatally flawed demolition of the former Deutsche Bank building at 130
Liberty Street. The agency has a contingency fund of about $25 million to cover the loss. If the authority loses the suit, and the penalty is higher than $25 million, the money will have to be cut from programs like the community-enhancement grants, or the drawing center. If the LMDC goes out of business before the suit is settled, its parent authority, the Empire State Development Corporation, would assume the liability. When all the money is spent, LMDC has to audit the expenditures. ESDC will then audit those audits, which will subse-
“I agree it’s taking too long,” LMDC President David Emil said. quently be audited by the federal Department of Housing and Urban Development, which maintains an audit team at the authority’s headquarters, Emil said. That bureaucratic tangle is part of what prompted former Assembly Member Richard Brodsky to push through a law in 2009 reforming reporting requirements for the state’s hundreds of public authorities. “We were certainly aware of the way in which LMDC had gone about dealing with lower Manhattan, almost as a direct arm of the governor’s office,” Brodsky said. “It’s an example of the abuse of the authority system.” “LMDC was not only an additional layer of bureaucracy, it was a nonresponsive, autonomous layer of bureaucracy,” said former City Council Member Alan Gerson, who represented the district that
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included the World Trade Center site. “It never fulfilled its total potential because of the hybrid structure of different government agencies being involved without any one of them having oversight.” The semiautonomous structure still generates controversy. Community Board 1 member Julie Menin was removed from the LMDC panel that decides who gets the $17 million in community grant money, drawing a flurry of letters from state lawmakers asking for her reinstatement. Assembly Speaker Sheldon Silver, who represents the area, said the authority currently lacks proper community input into how the remaining dollars are spent. “The Lower Manhattan Development Corporation still has work to do,” Silver wrote in an email. “I urged the LMDC to appoint a member of the community to the panel that will be recommending how these remaining funds are spent, so we can continue to build on the progress we have made in lower Manhattan.” Back at the community-board meeting, Emil fielded questions about money that has become the responsibility of what Menin called “an alphabet soup of regulatory agencies.” Money for affordable housing, subways, a bus garage and small-business development was being handled by various city and state agencies, he said. Emil said he would find the answers and get back to the board. After an hour and a half of questioning, Emil shouldered his briefcase, gripped his umbrella and prepared to walk back out into the rain. “I’ve had a lot of government jobs,” he said, “but this one is the hardest.” lnahmias@cityhallnews.com
CITY HALL
Road Less Traveled Make the Road takes a few steps into politics By AAron Short
N
onprofit annual meetings are not usually raucous affairs. But nearly 1,000 working-class and immigrant Brooklyn and Queens residents streamed into the SoHo headquarters of the Service Employees International Union two months ago, banging drums and noisemakers at Make the Road’s third annual members’ assembly. Inside, a murderers’ row of Democratic mayoral candidates sat patiently for several hours, waiting to speak to a bevy of mobilized voters. Make the Road’s legislative agenda advocating for living wages, paid sick leave and reversing school closures has permeated the City Council’s agenda this spring. And its membership received a boost when Democrats in the U.S. Senate reintroduced the DREAM Act, providing a path for citizenship to children of undocumented immigrants. It has gained political heft even while avoiding not only Brooklyn’s hierarchical Democratic Party apparatus—run by Assembly Member Vito Lopez, who shares similar political beliefs—but the neighborhood’s dueling political families. Now the 14-year-old organization is quietly building its political arm as it makes slow but steady progress on issues affecting its lower-income constituents—and one of its longtime organizers is running for an open Assembly seat. Make the Road’s distance from the established political structure was clear at its SoHo meeting. Brooklyn’s political ruling families—the Townses, Dilans and anyone affiliated with Lopez’s influential social service empire—were notably absent. Make the Road cofounder Andrew Friedman said he has invited its local officials to attend events, but few save for Brooklyn Rep. Nydia Velazquez ever show up. “We would love it if they were standing with us on issues, but historically they haven’t,” said Friedman. “It’s a missed opportunity. They make their own decisions and balance priorities, and all we can do is try to look for allies when we can.” Two years ago the group formed a political-action committee, allowing it to lobby government officials and set up a future run by one of its own organizers. Make the Road avoided helping any Bushwick candidates in 2009, when Council Member Diana Reyna clipped a Lopez-backed challenger in a primary, and last year, when Lopez crushed an insurgent district-leader candidate in Williamsburg. But when former Assembly Member
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Darryl Towns left his seat for an appointment in the Cuomo administration, Make the Road organizer Jesus Gonzalez began soliciting support from progressive clubs, labor unions and church congregations with the hope of securing a line on the Working Families Party ballot, according to several sources. He credits the organization with helping him find his community, which propelled his run. “I have received tons of love and support from MRNY staff and members, and I have found a space where I could work, practice and learn,” said Gonzalez. Three other candidates—including Council Member Erik Dilan’s chief of staff Rafael Espinal, who is assured of the Democratic Party’s backing, Rep. Edolphus Towns’ daughter Deidra Towns, and Cypress Hills activist John Rodriguez—are expected to run in a battle among Brooklyn’s longtime power brokers. Friedman said it wasn’t surprising that Gonzalez, an activist with Make the Road for over a decade, would see electoral politics as a place to influence public policy. “We’re thrilled that people get involved and engaged,” said Friedman. “It’s an important part of building power for lowincome immigrants to get involved politically.” Brooklyn progressive leaders say the race is an opportunity for Make the Road to grow and build leverage in its neighborhood. “Politics is everything,” said Democratic state committeeperson Chris Owens. “They’re starting to realize they won’t change things by just advocating for a policy, but by giving someone to vote for.” But there is a limit to how much Make the Road will help Gonzalez. Several Make the Road leaders said they would not do anything to jeopardize its nonprofit status. Other than receiving individual donations from them, Gonzalez is probably on his own. And one of his rivals thinks Gonzalez’s work with Make the Road won’t matter, since its members live primarily outside the district. “The campaign is going to be a major uphill battle for him, because he doesn’t know the dynamics of the district,” claimed one opponent’s campaign advisor. Still, Gonzalez is courting unions such as the SEIU, United Federation of Teachers and Retail, Wholesale and Department Store Union, which he thinks he can pry away from other candidates. Manhattan Council Member Melissa Mark-Viverito believes he can win—or at least show a presence at the polls and be well-positioned for a future Council run. “[Gonzalez’s campaign] shows that even if you are not part of the formal political process, you can make headway, win elections and demonstrate that strength,” she said. editor@cityhallnews.com
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11
DAN BURNSTEIN
CLASS WARFARE How the city’s fight with the teachers may signal larger troubles with labor BY ANDREW J. HAWKINS
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arlier this month, Mayor Michael Bloomberg received a phone call from an irate Michael Mulgrew, president of the United Federation of Teachers, about the budget he was about to release. Mulgrew knew it would include over 4,000 teacher layoffs, the highest number of pink slips since the late 1970s. Bloomberg had been predicting teacher layoffs for months, at one point suggesting the number could be as high as 20,000. Mulgrew was convinced the game was rigged. “I cannot believe you went up to Albany and told them funding didn’t matter,” Mulgrew recalled telling Bloomberg. “Fifty years this union’s been around, this has never, ever happened.” Bloomberg’s response, according to Mulgrew, was terse. They had no money, the mayor said. Stu Loeser, a spokesperson for Bloomberg, flatly denied the conversation took place, but noted that the mayor and Mulgrew occasionally speak by phone. “The mayor never went to Albany and said funding didn’t matter,” Loeser said. “He always said that cuts are inevitable, but they should be proportional to the cuts the rest of the state gets.”
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The disputes between Bloomberg and New York’s 87,000 unionized teachers are larger—and smaller—than ever. They can’t agree how to pay the best, how to cull the worst and how to get along while they work it out. They can’t even agree on who said what on the phone. And whether 20 teachers from P.S. 157 in the Bronx are fired—or 16 teachers from Pioneer Academy in Queens, or nine teachers from P.S. 19 in Lower Manhattan—hardly seems to matter at this point. The fight over dwindling tax dollars, as well as the mayor’s unilateral approach to school governance, has exposed a raw nerve with the teachers union, one that may compromise Bloomberg’s education legacy and change the way future mayors run the school system. While cuts may have been inevitable, the numbers released by the city May 6 were no less startling: 4,100 teachers laid off, another 2,000 lost through attrition. Five percent of the city’s teaching workforce slated to vanish from the city payroll. The response has been predictable, and loud. On May 12, teachers and their union allies came out in droves to protest Bloomberg’s austerity budget, claiming he was using layoffs as a bargaining chip to help him overhaul seniority rules and eliminate the state’s “last in, first out”
(LIFO) requirements. Teachers crammed the streets of the Financial District sporting black T-shirts that read “Education mayor? Really?”; waving signs that portrayed Bloomberg as, alternately, the Joker, Robin Hood and Doctor Doom; and creating a racket with whistles, drums and their own voices. “He’s just a bully,” said Pat BaileyHollon, a librarian at P.S. 315 in Brooklyn, of Bloomberg. “He does this every year, and we just have to call his bluff.” “The ability of children to learn is difficult enough with the overcrowding situation we have,” said Ari Steinfeld, a special-education teacher at Richmond Hill High School in Queens. “But if you lay off 6,000 teachers, you’re putting a nail in the coffin.”
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he city and union have come a long way from the days when Al Shanker, founder of the UFT, would hold whiskey-sour parties in his one-bedroom apartment to organize members. In 1975 Shanker used $150 million from the union’s pension fund to purchase Municipal Assistance Corporation bonds, helping save the city from fiscal collapse. Even Bloomberg has had better days with the union, when he and Randi Weingarten, Mulgrew’s predecessor, would have
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semiweekly breakfast meetings to hash out disagreements over education policy. Weingarten could get under the mayor’s skin when need be, but relations were largely civil. Weingarten would often stand alongside the mayor on controversial issues, such as merit pay for teachers and mayoral control. Bloomberg even flew down to Washington, D.C. in late 2008 to introduce Weingarten at the National Press Club for her debut as president of the American Federation of Teachers. But today, even Weingarten is falling back on her old attack lines. “[These cuts are] pitting people against people, schools against schools, teachers against teachers,” she said outside City Hall before a recent rally. “I’m very disappointed in the mayor, because there’s no reason that this is happening.” Union officials are proud of their pugnacious reputation. Their office walls are festooned with blown-up editorial cartoons portraying teachers as mobsters, flying monkeys and knifewielding murderers. With his bald head and meaty hands, Mulgrew himself looks like he knows his way around a body slam. But Mulgrew also knows that this fight could cost many of his members their security, their benefits or even their jobs.
CITY HALL
“We want kids to succeed,” he said. “If we know something is being done that will not help that, and actually will hurt that, fine with me, let’s just fight. It’s in a teacher’s DNA to protect.” That kind of talk marks a huge shift. In Bloomberg’s first term, he gave teachers a whopping 43 percent raise. In his third term, new schools chancellor Dennis Walcott introduced himself by promising never to insult teachers. In an interview, Walcott said he was concerned about low teacher morale in New York. But he argued that the city is shouldering more than its fair share of education costs, while the union appears unwilling to entertain the notion of givebacks or concessions. “The mayor has stepped to the plate since he’s been there, as far as teachers are concerned,” he said. Walcott has a reputation as a peacemaker, and says he is confident the city can still negotiate with the union. But other members of the administration don’t see any common ground. “There are just fundamental differences with the union,” said one administration insider. “The union doesn’t care about tone.”
M
ulgrew and Bloomberg were able to work together in the past. A year ago they stood side by side at a Midtown Manhattan press conference to announce a deal on the closing of the infamous rubber rooms where teachers accused of wrongdoing once sat and received pay for doing nothing. Since then, the union has sued the city to prevent school closings, sued to block the release of teacher data and sued to force the city to hire more teachers and reduce class sizes. In short, education in New York has become a lawyer’s paradise. Mulgrew says the union lawsuits are necessary to protect children and prompt the city to act. City lawyers, he complains, are responsible for derailing negotiations over issues like teacher evaluations. “When we’re making decisions based on a lawyer’s needs rather than sound educational policy, we’re making bad decisions,” he said. Mulgrew knows how to wield the bully pulpit and manipulate the media spotlight. But his methods have raised some eyebrows, especially as they relate to LIFO and layoffs. “If you have to make sacrifices, you sacrifice so the people who go are gone and the people who stay are glad they still have their jobs and their benefits,” said Norman Adler, a veteran political and labor strategist. “Mulgrew is not playing that game. He’s fighting to keep all these young teachers on the job.” There is no question that Bloomberg’s standing among unions, especially after this latest budget, is at an all-time low. Even those union heads who once supported the mayor think his third term has been replete with bad ideas. Norman Seabrook, president of the
CITY HALL
Projected Layoffs by District and School Level Riverdale, Spuyten Duyvil, Fieldston, North Riverdale, Kingsbridge, Norwood, Bedford Park, Fordham, Belmont, University Heights
Van Nest, Pelham Parkway, Woodlawn, Williamsbridge
9%
Highbridge, Mount Eden, Grand Concourse
10%
7%
Washington Heights, Inwood, Hamilton Heights
Mott Haven, Melrose
11%
6% East Harlem Upper West Side, West Harlem, Central Harlem, Manhattanville
9%
12%
8% 10%
Upper East Side, Tribeca, Greenwich Village, Chinatown, Chelsea, Midtown West, Flatiron, Grammercy, Murray Hill
Tremont, East Tremont, West Farms, Belmont
Hunts Point, Soundview, Throgs Neck
5%
9%
Lower East Side, East Village
10%
East Williamsburg, Bushwick, Williamsburg, Greenpoint
8% North Corona, South Corona, Lefrak City, Elmhurst, Maspeth, Middle Village, Glendale, Ridgewood, South of Woodside
7%
7%
6%
Park Slope, Prospect Heights, DUMBO, Fort Greene, Bedford-Stuyvesant Owls Head Park, Bay Ridge, Dyker Heights, Borough Park, Kensington, Bensonhurst
Beechhurst, College Point, Whitestone, Flushing, Murray Hill, Willets Point, Kew Gardens Hills
Cypress Hills, East New York Ocean Hill-Brownsville
6%
5%
8% Sunset Park, Park Slope, Carroll Gardens, Gowanus, Red Hook
7%
South Jamaica, Rochdale, Kew Gardens, Rego Park, Forest Hills, Jamaica
5%
East Flatbush, Canarsie
5%
Flatlands, Midwood, Mill Basin
Prospect Heights, Crown Heights, Flatbush, Prospect Park South
6% Far Rockaway, Seaside, Belle Harbor, Breezy Point, South Ozone Park, Rochdale, Springfield Gardens, Howard Beach, Lindenwood, Richmond Hill, Woodhaven, Ozone Park JOEY CAROLINO
Corrections Officers’ Benevolent Association, who twice endorsed Bloomberg for mayor, said much has changed since the mayor’s first two terms in office. “Remember the people that were around him,” Seabrook said. “The people that were around him were the Peter Madonias of the world, the Marc Shaws of the world, the Kevin Sheekeys of the world—people who had a relationship with unions, that could communicate. The people he’s surrounded by right now have no relationship with unions. They don’t know anything about unions. So the mayor is more or less left out there on his own.”
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ulgrew accuses Bloomberg of sitting on a $3 billion surplus that could be used to prevent teacher layoffs. The mayor’s aides blast the union for failing to lobby state legislators in Albany, whom they blame for shortchanging the city on education funding. The two rarely appear together at public events any more. And the Cathie Black debacle did nothing to raise Bloomberg’s stock in the eyes of teachers. Things have gotten so bad between Bloomberg and the teachers that Mulgrew said he was starting to rethink his position on mayoral control, a policy the union once endorsed.
“This is something we’re questioning, because wherever I go, when I’m outside of meetings with teachers, when I’m meeting with parents and the community, I’m constantly being called on,” Mulgrew said. “They’re asking, ‘Why aren’t you calling for the repeal of mayoral control?’ That’s something I’m getting more and more of.” Before he tackles mayoral control, though, Mulgrew will have to deal with a growing number of teachers who question whether he really represents the best interests of teachers. A new group, Educators 4 Excellence, was formed to give voice to those teachers who support repealing the seniority rule, but Mulgrew and his allies dismiss them as tools of the mayor. “Our members are frustrated, because they feel the administration has its agenda and the union has its agenda but that neither body is really asking or listening to teachers,” said Evan Stone, cofounder of the group, which has been tussling with Mulgrew over whether to allow for a citywide survey of teacher opinions. Mulgrew has bigger things on his mind. The UFT has not had a contract with the city since October 2009. Under state law, the union continues to operate under the provisions of the previous contract, which allows members to continue to
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collect built-in raises. Since 2008 over half of the union’s membership received pay increases, earning on average $3,539 more in 2010 than they did the previous year, school officials say. The total cost to the city for these automatic increases was $145 million. But generous salary increases have not persuaded the union to restart stalled contract negotiations. And with the mayor’s insistence on challenging sacred cows like tenure and pension benefits, union officials feel little pressure to finalize a contract before the end of Bloomberg’s term [see sidebar, pg. 14]. A recent change at the state level in how public school teachers are evaluated could give Bloomberg a way to lure the union back to the table. Gov. Andrew Cuomo recently pushed through a rule change to allow state test scores to account for up to 40 percent of a teacher’s evaluation score, up from just 20 percent. The state teachers’ union was incensed, claiming that the change goes beyond the revised evaluations negotiated as part of the Race to the Top reforms. Meanwhile, Mulgrew and the Department of Education will have until Sept. 1 to hammer out the details. If Mulgrew wants fewer layoffs, he may have to accept Cuomo’s new evaluation standards. MAY 23, 2011
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reventing teacher layoffs will cost $270 million under Bloomberg’s budget. City Council members can’t come up with all that from their own discretionary funds, so they’re eyeing other pots of money, while questioning whether the city’s budget problems are really as dire as Bloomberg predicts. “This is a manufactured crisis,” said Council Member Daniel Dromm, a Queens Democrat who prior to his election was a teacher for 25 years. “As a Council member, I know we have the rainy-day fund, a portion of which can be used to prevent these layoffs.” School officials argue that the proposed layoffs are not a ruse but a reflection of the state’s shaky budget situation and the need for the city to balance its books. Walcott says the Department of Education has begun preparing by freezing license changes and diagramming the impact of layoffs, school by school. “There are a lot of conversations taking place between a variety of parties,” he said. “But at this particular point in time, there is nothing resulting from those conversations.” Last year a last-minute injection of stimulus money and a citywide hiring
freeze allowed the city to avoid projected teacher layoffs. This year school officials say the money is just not there.
“The people he’s surrounded by right now have no relationship with unions,” said Norman Seabrook. “They don’t know anything about unions. So the mayor is more or less left out there on his own.” “We’re preparing for the eventuality of layoffs,” Walcott said. “When it’s appropriate, we’ll have notices out to the field indicating that.” Mulgrew says Bloomberg has lost touch with teachers, and recent poll numbers seem to back him up. Sixtyfour percent of New Yorkers disapprove of the mayor’s handling of the schools, a recent Quinnipiac poll found. And while a vast majority supports his effort to eliminate LIFO, 57 percent also consider
mayoral control to be a failure, a reversal from 2009, when a similar number declared mayoral control a success. “I am sure it matters to him,” Mulgrew said of Bloomberg’s dismal poll numbers. “How do you build relationships? You go out and talk to people; you listen to them. What are they really facing? Go to schools. Don’t bring an entourage; see what’s going on.” Still, the long-term effects of the current tête-à-tête between Bloomberg and the teachers may be more damaging than either side would care to admit. And whether it’s a bluff or the new reality, Bloomberg and Mulgrew will still have to work together after July 1, when the city is required by law to have a balanced budget. Diane Ravitch, an education historian and a fierce critic of the mayor’s educational policies, said the city and the unions will always have their ups and downs on wages and benefits. But the long-term effects on the teaching profession could be irreparable. “In historical terms, a profession that was once stable, secure and respected is now in turmoil,” she said. “There will always be a supply of eager youngsters who want to teach, but who will mentor them and teach them the ropes?” ahawkins@cityhallnews.com
Angry Unions Say No Deals With Bloomberg With no raises on tap, city workers skip new contracts
“Even though we recognize that our members are in desperate need of a salary increase, the mayor wants certain concessions that we’re not even willing to discuss,” said Santos Crespo, president of DC 37 Local 372, which represents 25,000 nonteaching public school employees. “If The United Federation of Teachers’ you rush into a contract, then down the road last contract expired a few days you realize you might have done better.” before Mayor Michael Bloomberg Some union leaders are already was reelected in 2009. Their next one wondering if they could find a may not come until after his New York City’s largest unions more receptive ear in the next successor takes office in 2014. are working without contracts mayor. The field of Democrats The UFT is not alone. City Number of Contract jockeying to replace Bloomberg union leaders say Bloomberg’s Union members expired is almost uniformly friendly pledge not to give raises to United Federation of Teachers 87,000 Oct. 31, 2009 to labor and eager for union their workers—and his push DC 37 Local 372 25,000 March 2, 2010 backing, said longtime union and to curtail their pensions and 24,000 Sept. 25, 2010 political operative Norman Adler. health benefits—take away any Teamsters Local 237 Patrolmen’s Benevolent Association 23,000 July 31, 2010 “You wouldn’t have to say to incentive they have to cut a them, ‘What kind of a contract deal with him. Uniformed Firefighters Association 8,000 July 31, 2010 would you give me?’” Adler said. “I honestly feel that “Of course you couldn’t exchange an produce the savings we need.” nobody’s going to sit down and try to endorsement for a pecuniary promise. He earned further labor enmity by negotiate a contract with this guy,” said It’s against the law. But it wouldn’t have demanding an end to $12,000 annual Harry Nespoli, head of the sanitation to be, because that would be the basic pension bonuses for retired cops and workers’ union and the Municipal Labor assumption—that they would do better firefighters—benefits they had bought Committee, the umbrella group for with most Democrats than they would and paid for years ago. unionized city workers. with Bloomberg.” “I don’t know if anybody’s going “I endorsed the man three times. I Still, Queens College labor historian went out there and supported him on his to rush to make a contract with this mayor,” said Gregory Floyd, president of Joshua Freeman expects that both sides extended term,” he said. “What we’ve will start to find common ground again been treated with at the bargaining table Teamsters Local 237. “To ask us to not before the end of Bloomberg’s term. take an increase—and on top of that, to lately is disgust.” “Very often, lo and behold when the take cuts—is really draconian.” Times have changed since the boom time to settle happens, other sums in Bloomberg’s budget doesn’t include a years of Bloomberg’s second term, when penny for union raises through the middle reserve somehow become available,” he he signed off on a round of 4 percent said. “Between now and the next mayor of 2012. After that, however, the financial raises for city workers just before the being inaugurated is a very long time.” plan assumes 1.25 percent raises each recession hit. Now he decries the cost —Adam Lisberg year, and counts $1.6 billion to pay for of pensions, based in part on those alisberg@cityhallnews.com them through the middle of 2015. increased salaries, and vows to hold a firm line. “The only way we will be able to afford raises for city workers in the future is if we can find some savings in our pension and health-care bills. That is not a negotiating strategy or stance. It’s reality,” the mayor said in this year’s State of the City address. “I will not sign a contract with salary increases unless they are accompanied by reforms in benefit packages that
TIME’S UP
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MAY 23, 2011
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Tell It To The Judge
Unions challenge city layoffs in court Even if Mayor Bloomberg carries through on his threat to fire 4,100 teachers, it would be unlikely to lead to pink slips right away: Legal challenges could block any layoffs for months. Union lawyers have won temporary reprieves for a broad range of government workers threatened by budget cuts in recent years. Laborers and laundry workers at the Health and Hospitals Corp., clerks and deputy sheriffs at the
“How did we get to the point where people who don’t like the manager’s decision run to litigate?” finance department, even token-booth clerks at the MTA have all had layoffs stalled thanks to legal actions. “How did we get to the point where people who don’t like the manager’s decision run to litigate?” asked critic Carol Kellermann, head of the Citizens Budget Commission. “I guess because it succeeds.” DC 37, which claims 125,000 members in city government, is unapologetic about using the courts to constrain budget cuts. The union protected 51 hospital laborers from layoffs last September by telling a judge that eliminating their jobs would leave the institutions unable to protect their patients and employees, said Steven Sykes, the union’s senior assistant general counsel. “Management fundamentally is allowed to manage—or to mismanage, as we say around here—but not to be arbitrary and capricious,” Sykes said. The tactic doesn’t always work: Finance laid off 45 low-paid clerks earlier this month despite a DC 37 legal challenge that stalled the layoff for months by claiming it discriminated against the disabled. Still, the trend has steamed Mayor Michael Bloomberg, who in January blasted Manhattan Supreme Court Justice Emily Jane Goodman for issuing a restraining order that blocked the layoffs of nine deputy sheriffs. “There’s no reason in law for the judge to do this,” the mayor said. “We’re going to waste something like $3,000 a day, over $1 million a year, just because the judge decides to step in and say, ‘Oh, I feel sorry for those people’? What about for the taxpayers? We’re going to have to lay off people now in other areas where we would not before.” —Adam Lisberg alisberg@cityhallnews.com
CITY HALL
Crowded House
20,000
A push for zoning and codes overhaul to ease overcrowding, reduce firetraps BY JON LENTZ
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wo deadly blazes in recent weeks, one in a Bronx apartment and another in Brooklyn, are raising questions about the city’s ability to crack down on thousands of apartments that are illegally divided into separate, smaller units. While much of the city’s response focuses on how to bolster enforcement, an additional answer could be to adapt the zoning and building codes to pave the way for smaller—and safer—housing units as an alternative to the overcrowded, risky conditions many New Yorkers live in. “If you want to change those problems, you have to offer other kinds of solutions,” said Jerilyn Perine, executive director of the Citizens Housing & Planning Council, a housing research organization. “You can’t just outlaw the world of the underground housing market. It exists because people can’t find what they need in the normal housing market.” Easing the regulations would boost the supply of housing for low-income families, single adults and commuters who stay in the city part-time, according to the group. No one disputes that illegal subdivisions are a problem. Mayor Michael Bloomberg said the U.S. Census undercounted the city population by around 250,000 people in part because it missed
residents in illegal subdivisions. The CHPC estimated in 2003 that 100,000 illegal dwellings were in spaces not designed for residential use at all. And each year New York City receives about 20,000 complaints about illegally converted apartments, though it is able to inspect fewer than half of them. The Bronx apartment fire in late April killed a construction worker, his wife and their 12-year-old son, who were living in a building on Prospect Avenue. The fire in Bushwick in mid-May killed two men.
2/3
Two-thirds of city requests for access warrants are denied by the courts.
45%
Forty-five percent of the buildings where warrants were issued were accessed by investigators in the last fiscal year.
“You can’t just outlaw the world of the underground housing market,” says Jerilyn Perine. “It exists because people can’t find what they need in the normal housing market.”
In both cases, apartments had been divided into single-room units. City building investigators received multiple complaints about illegal subdivisions in each building, but could not gain access. Buildings department spokesman Tony Sclafani said the agency has stepped up enforcement regarding illegally subdivided apartments, but offered no opinion on whether the code itself needs to change. “The reason why there is a building code is to ensure the quality of life of a neighborhood, and the safety of that neighborhood,” he said. At issue are the complicated technical requirements on housing density, square footage, room size and other measures that determine how many people can fit in a single dwelling, and how many of them can fit in a single building. That means apartment roommates often violate a rule barring more than three unrelated adults from living together. Other cases involve commuters from outside the city who Illegally subdivided apartments have proven need to stay over on weekdifficult for the city to regulate. ASIAN AMERICANS FOR EQUALITY nights but have trouble
CITY HALL
About 20,000 complaints about illegally converted apartments are lodged with the city’s Department of Buildings a year.
1,300
The city issued about 1,300 orders to vacate illegally subdivided apartments last year.
ASIAN AMERICANS FOR EQUALITY
finding affordable single-room lodgings. The jumble of rules is designed for traditional nuclear families, Perine said, but CHPC wants to encourage apartments designed for unrelated adults to share, as well as new mini dwelling units. Given New York’s seedy history with lodging houses, one variation of singleroom occupancy housing, Perine said it won’t be easy to change perceptions. “One of the big problems is [that] it’s hard for people to have a vision of what we’re talking about, and so people kind of default to their worst nightmare,” Perine said. ‘I’m going to live in this teeny-weeny, itsy-bitsy, horrible place,’ or ‘I’m going to have the Animal House neighbors next to me, a bunch of college kids running amok.’” Mark Ginsberg, an architect with Curtis Ginsberg and a CHPC board member, said overlapping zoning and building codes leave little flexibility. Parking requirements discourage smaller units; accessibility rules mandate minimum bathroom and kitchen sizes; and affordable housing follows even stricter mandates. “There’s a variation, from discouraging to outright preventing smaller units,” Ginsberg said. One possible change would be to allow single-person studios that are 300 square feet in size, well below the 400-squarefoot minimum. CHPC plans to showcase some new compact-living designs at a November event.
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Ginsberg noted that 300-square-foot units are already premanufactured, and they include a kitchen area with a refrigerator, sink, microwave and two-burner stove; a bathroom, a closet and space for a bed, a desk and a dresser. “Some of this is going to raise discussions,” Ginsberg said. “I don’t think we’ve had the discussion as a society where we’re saying this is all bad or all good.” PlaNYC, the mayor’s sustainability agenda for the city, suggests the same approach advocated by CHPC. It calls for “the development of new nonconventional housing alternatives,” including smaller housing models, to meet the needs of the growing population. That need is growing more urgent: The Bloomberg administration predicts the city population will rise to over 9 million by 2030. More than half of New York tenants spend 30 percent or more of their income on rent. Patrick Markee, a senior policy analyst for the Coalition for the Homeless, said the devil is in the details for any code changes. “Any conversation about relaxing those codes implicates some real issues around health and safety,” Markee said. “That’s not to say that all the existing codes are the right ones, or the right ones for now, but there’s a reason that they’re there, and they weren’t put there arbitrarily.” jlentz@cityhallnews.com MAY 23, 2011
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Rent Law Battle Widens Fissures On Both Sides Real estate and tenant groups grapple with internal divisions By AdAm LisBerg
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s time grows short to renew the rent regulations covering one million New York City apartments, both sides are battling for Gov. Andrew Cuomo’s ear—and hoping to drive a wedge between each other’s supporters. On one side is the alliance of two large organizations representing city real estate interests, the Rent Stabilization Association (RSA) and the Real Estate Board of New York (REBNY). While the two groups largely share a worldview, their most pressing issues can diverge: Small landlords want relief from rent laws, while large landowners want to encourage development. “They don’t like each other, but they will stand together to oppose pro-tenant changes to the rent laws,” said Michael McKee of Tenants PAC. Facing off against them is the alliance of Sheldon Silver, the powerful Assembly speaker, and Vito Lopez, who chairs both the Assembly Housing Committee and the Brooklyn Democratic Party. Both men are stalwart supporters of affordable housing, but while it’s the only issue that matters for Lopez, it’s one of many interests Silver must juggle as he negotiates with Cuomo and the Republican-led Senate on other topics like a property-tax cap, ethics reform and gay marriage. “Vito has put forward what he believes the tenant advocates want and what Shelly wants,” said REBNY president Steven Spinola. “In the end, everything in Albany is negotiable.” All sides expect the rent laws to be renewed next month, but the battle is over whether to expand them by raising the limits on what apartments qualify for rent regulation—currently, those with rents below $2,000 for tenants making up to $175,000 a year. That’s the ultimate issue for the RSA’s 25,000 members, most of whom are outerborough landlords with 12 to 24 apartments in each building, said the group’s president, Joseph Strasburg. “We think that the existing law as it is works well,” Strasburg said. “We think the people who benefit from this law who don’t need it should face a means test.” For REBNY, though, rent laws are just one of many factors crimping developers and property owners. They want to
renew a program called 421-a that gives large new construction projects a tax break in exchange for setting aside 20 percent of their apartments for affordable housing. They want to blunt the impact of a court ruling that limited rent hikes at Stuyvesant Town. And they want to limit the tax bills of large city properties to 20 percent of their gross income. “REBNY is overshadowing RSA, and they may have as a priority more 421-a and the [Stuyvesant Town] decision,” Lopez claimed. “Strasburg does not even want a straight extender, and the fact that it’s going to happen shows a little weakness in RSA, and that people only care about what Spinola wants.” The differing agendas on both sides have already taken a toll. When Democrats still controlled the Senate last summer, negotiators tried to write a giant package bill that extended the rent laws, 421-a and other housing issues, but it collapsed under its own weight. (Each side blames the other for failing to take a good deal when it was within their grasp.) Similar efforts to include housing issues in Cuomo’s first budget this spring also fell apart. While talks have not restarted, everyone expects they will finally be resolved in the grand rush to end the session in June. That means access to the governor will be key, but he has reason—both personal and ethical— to steer clear of key figures on both sides. Strasburg angered the governor when a heavily edited video showed him telling an audience about Cuomo’s negotiating style: “He will do whatever is necessary for himself. If you’re in his way, he’ll crush you like his father did.” Lopez, meanwhile, is under an ethical cloud as federal probers look into the finances of the Ridgewood Bushwick Senior Citizens Council he founded. Soon after taking office, Cuomo took an unmistakable slap at Lopez by appointing a rival, Brooklyn Assembly Member Darryl Townes, to run his housing agency. The fissures at the top of each side’s leadership also make it hard to predict how Senate Majority Leader Dean Skelos will act, since nothing will be done without his Republican caucus. But both camps claim to be confident. “The real question is what do the three leaders feel they have to do?” Spinola said. “If there’s going to be a discussion and a negotiation, I’m going to be part of that discussion.” “The momentum is in favor of a rentregulation bill passing,” Lopez said. “It’s room for some gains on rent regulation.” alisberg@cityhallnews.com
“In the end, everything in Albany is negotiable.”
New York City Chief Digital Officer
RACHEL STERNE WEDNESDAY, JUNE 15TH 8:00 AM TO 9:30 AM Moderated by Adam Lisberg Editor of City Hall Location: to be announced
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16
MAY 23, 2011
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CITY HALL
WE HOUSE NEW YORK… Deregulation Has Generated $12.2 Billion in Economic Activity •
From 1994 to 2010, the deregulation of high-income/highrent apartments resulted in a $12.2 billion infusion to the New York City economy.1
•
This included $3.9 billion in increased real estate tax revenue that funded municipal services and $6.8 billion in housing construction and improvements that generated thousands of jobs.1
•
At the same time apartments were being deregulated, rentstabilized units increased by 25,811 to 1,077,333 between 1993-2008.1
•
Eighty percent of deregulated apartments are in Manhattan.2
•
Wealthy renters in Manhattan saw their rent subsidy increase from $159 in 1987 to $345 in 2005.3
•
A majority of multi-family property owners own less than 20 units of housing.4 Nearly half of all owners are at risk because rental income fails to exceed building operating costs.5
Why Would Anyone Want to Repeal Vacancy De-Control? “The Impact of Deregulation of Rent Stabilized Units by High-Rent/High-Income Decontrol and High-Rent Vacancy Decontrol: An Economic and Fiscal Impact Study” Urbanomics, May 2011 2 “Changes to the Rent Stabilized Housing Stock in New York City in 2008” The New York City Rent Guidelines Board, June 4, 2009 3 “The Value of Rent Subsidies from Rent Stabilization by Borough & Neighborhood of New York City: An Econometric Study based on the2005 Housing and Vacancy Survey” Urbanomics, May 15, 2009 4 The Rent Stabilization Association Membership Files 5 “Survey of Owners of Rent Stabilized Property” Urbanomics, June 17, 2009 1
“MY
CONSTANCE NUGENT-MILLER. I STRUGGLE LIKE MANY OF MY NEIGHBORS – AS A SINGLE MOM, WORKING TWO JOBS TO PAY THE BILLS. I PROVIDE AFFORDABLE RENTAL HOUSING TO SIX FAMILIES IN CROWN HEIGHTS IN A BUILDING THAT’S BEEN IN MY FAMILY FOR 50 YEARS. THAT’S A HARD JOB, WORKING UNDER THE TOUGHEST RENT LAWS IN THE COUNTRY. BUT I MANAGE – BECAUSE MY TENANTS ARE COUNTING ON ME.” NAME IS
“MY
NAME IS
ALBERT CORION. I’M
A RETIRED TRUCK
DRIVER, STRUGGLING LIKE MANY OF MY NEIGHBORS TO MAKE ENDS MEET . HOUSING TO IN
F LATBUSH
YEARS .”
41
I
PROVIDE AFFORDABLE RENTAL
FAMILIES IN TWO SMALL BUILDINGS
THAT MY FAMILY HAS OWNED FOR
30
“WE HIRE NEIGHBORHOOD PLUMBERS AND PAINTERS TO MAINTAIN OUR APARTMENTS. WE GIVE JOBS TO LOCAL RESIDENTS. OUR REAL ESTATE TAXES PAY FOR COPS, FIREMEN AND TEACHERS – BUY BOOKS FOR SCHOOL KIDS – AND PROVIDE SERVICES FOR SENIOR CITIZENS. FACT IS, THOUSANDS OF SMALL BUILDING OWNERS JUST LIKE US HELP THE CITY AND STATE SURVIVE ECONOMIC HARD TIMES. AND, WE PROVIDE AFFORDABLE HOUSING TO OUR TENANTS. THE LAST THING WE NEED IS MORE REGULATION FROM ALBANY.” RENT STABILIZATION ASSOCIATION • 123 William Street New York, NY 10038 • TEL: 212-214-9200 • WWW.RSANYC.ORG
issue spotlight:
Education Living WagE
Point/Counterpoint
The debate over living wage has been heating up, with Mayor Michael Bloomberg squaring off against living-wage proponents over the economic impact of the bill. Will Council Speaker Christine Quinn put the living-wage bill up for a vote? Will it kill more jobs, or asked Brooklyn Borough President Ruben Diaz, Jr., and Jack Friedman, executive director of the effectively combat poverty? Queens Chamber of Commerce, to discuss the living-wage issues before the city. Q: What is being overlooked in the current
Diaz: It’s polarized because of the mayor of
debate?
the city of New York. You have a city that wants to continue to give billions of dollars a year in grants, loans, abatements, incentives to giant corporations—and it’s not worried about addressing people in poverty and the poverty rate in the city of New York.
Jack Friedman: What’s being lost in the debate is the job-creation killer that this is going to be. The perfect example is Kingsbridge Armory, where 2,200 people remain unemployed. These are not just low-paying jobs. They cover the spectrum of jobs that may pay under $10 an hour, but many pay higher than that: middle managers, managers and construction workers who would’ve been paid full union scale to renovate the Kingsbridge mall. All these Jack Friedman people remain unemployed and a building remains empty because of living wage. I don’t need studies to tell me that this is going to have a devastating effect.
Q: What possible compromises do you see between advocates and the mayor and his allies? Friedman: In this case, I don’t see any. This is a case where there’s a government-mandated Ruben Diaz, Jr. wage requirement, and none of the cutouts or carve-outs they’ve suggested are going to make this any more palatable. The bill as a whole just won’t work, hasn’t worked in other places and will do nothing but create more unemployment here.
Ruben Diaz, Jr.: That we have a comprehensive plan to deal with poverty. What we’ve seen, even during an economic crisis, is that the city’s paradigm and the way it has given out public dollars are only benefiting very wealthy people. We continue to see—particularly in my home borough, while there’s still been a lot of investment of public dollars, we still see high poverty rates and high unemployment. This basically says that we should have a better rate of return on investment in terms of our tax dollars. If you receive public benefits, then your project should benefit the public, not just a very few wealthy people.
Diaz: There are always compromises. I was a legislator before I was the borough president, and no bill is a perfect. What I have said is we have always been openminded with anyone who has concerns, whether they’re in business, whether it’s the city of New York or otherwise; and that we will be willing to sit and talk about it and amend the bill if need be, if it’s reasonable concerns.
Q: In the wake of the Kingsbridge defeat, Diaz said, “The notion that any job is better than no job no longer applies.” Your reaction?
Q: What businesses would be affected? Friedman: Almost every type of business. Our coalition includes everything from movie-theater owners, regular theater owners, coops and condominiums, affordablehousing proponents, supermarkets and retail manufacturing. This bill is so far-reaching that it literally affects almost every single industry in New York City.
Diaz: Retail. When you look at anyone who is coming to us as government and saying, ‘We want to build this retail center; we want to build this large complex,’ what we are saying is that if it exceeds a certain amount of money, then the people you have there as a tenant should know they are to hire folks at at least $10 an hour with benefits, $11.50 without. Affordable housing is exempt. Small businesses making less than $1 million a year are exempt. Not-for-profits are exempt under this bill. This is about the Relateds of the world. They do fine in terms of profits and business in other cities that have a living-wage ordinance. Q: How did this issue become so polarized? Friedman: We would all like to see people making wages high enough that they can feed their families well and raise their families with a quality of life that you would expect anyone in New York City or this country to have. The problem is that the proponents believe that it should fall on the backs of small business, and they don’t understand that businesses in this economy are struggling to stay alive, working on tiny margins below 3 percent, trying as hard as they can to pay their workers as much as they can, with the best benefits they can.
CITY HALL
Friedman: It’s an argument where they’re going to hurt the people they’re purporting to help. The perfect example is the Gateway Shopping Center in the Bronx. That was not a living-wage deal. Many people may have started below $11.50 an hour, but they’ve been promoted and they’re making $12, $14, $16, $18 an hour now. Those are the type of jobs at Kingsbridge that have been lost. What I think Borough President Diaz is missing is the aspect of all the construction jobs at union scale. All those people that missed the opportunity of getting those starting wages are now sitting unemployed. To make the claim that they’re better off unemployed than they are working is a ludicrous argument.
Diaz: Obviously, 1,000 percent I’m going to say it’s better to make minimum wage than no wage at all. That was not what I was talking about. What I was saying is, when it pertains to developers receiving large taxpayer subsidies, for them to come to us and offer just minimum wage/poverty-wage jobs, part-time jobs, and for us to just accept it, that no longer applies here. That’s what I said. I have two sons. One is coming home from Boston College over the summer. If he is going to sit around the living room and do nothing all day over the summer, or he can go and work at Burger King and make a minimum wage, if you ask me which one he should be doing? Absolutely go work at Burger King and make that minimum wage. That job is better than no job at all. What I’m speaking to are those developers who want tens of millions of dollars in taxpayer subsidies and don’t want to pay at least $10 an hour. They only want to offer us a minimum-wage job and say, “Oh, you should accept that; that’s better than nothing.” No; no, it’s not.
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19
ISSUE SPOTLIGHT: LIVING WAGE Living Wage Timeline Nov. 2002
Dec. 2009
May 2010
Dec. 2010
Mayor Michael Bloomberg signs one of the nation’s most sweeping living-wage bills into law, which gives 50,000 home healthcare workers and 9,000 childcare workers a beginning wage of $9.60 an hour.
City Council defeats a plan backed by Bloomberg to redevelop the long-vacant Kingsbridge Armory in the Bronx as a retail center. The vote follows the administration’s refusal to succumb to demands that the developer at the site pay a living wage.
Bronx Council Members Oliver Koppell and Annabel Palma introduce a citywide livingwage bill into the Council at the behest of Bronx Borough President Ruben Diaz, Jr.
The Center for American Progress, a liberal think tank, releases a study claiming livingwage mandates do not cause job losses.
1999 Los Angeles passes a livingwage law.
Weighing Wages Living wage: A living wage is based on the cost of living in an area, and is intended to provide enough income to maintain an acceptable standard of living. Advocates say a living wage in New York City is currently $10 per hour with benefits, or $11.50 per hour without benefits. Under a bill before the City Council, employees working on properties where developers receive at least $100,000 in city subsidies would be paid the living wage.
Jan. 2010 The Fair Wages for New Yorkers Act is amended to exclude nonprofits, small businesses grossing less than $1 million annually and affordable housing.
May 2010
May 2010
EDC releases its long-awaited study, which finds that the bill would stifle development, cost tens of thousands of jobs and sacrifice billions of dollars’ worth of private investment over the next 20 years.
Council holds a lengthy hearing on the livingwage bill. Koppell and Palma say they are willing to negotiate, while the Bloomberg administration says it will oppose the bill in any form.
An Informal Living-Wage Poll
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s the fight over a living-wage provision intensifies, City Hall granted 19 City Council members anonymity to discuss their position on the issue frankly.
2. Will it pass? Yes: 10 No: 6 No Answer: 3
1. Should a comprehensive livingwage bill pass? Yes: 12 No: 6 No Answer: 1
3. Was the outcome at the Kingsbridge armory a positive or negative milestone for economic progress in New York City? Positive: 7 Negative: 7 No Answer: 5
Minimum wage: A minimum wage is the lowest legal wage employers can pay employees. For most employees in New York it is $7.25 an hour, the same as the federal level. One exception is for waiters and waitresses, who can be paid a lower base rate supplemented by tips. Seventeen states have a higher minimum wage than New York’s.
Stay Informed
Prevailing wage: A prevailing wage is set each year for construction workers, mechanics and other private-sector laborers on public-works projects across New York. The wage schedule varies geographically and by position, ranging from around $20 to more than $50 an hour. A bill before the City Council would raise the prevailingwage pay scale for workers in buildings receiving $10,000 or more in city subsidies. —Jon Lentz jlentz@cityhallnews.com
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MAY 23, 2011
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CITY HALL
The Voices of the Living Wage Movement “For 5 years, I worked at the concession stand and gift shop at the Statue of Liberty, where I earned $8.25 per hour. My hard work made a difference to this city by creating a positive experience for both tourists and New York residents, but I could barely afford to live. Does this sound like life, liberty and the pursuit of happiness? This city needs a change. We are providing charity to extremely profitable businesses while workers suffer. This isn’t right. We need a living wage and we need one now!” -Kim Ortiz, Former retail worker at the Statue of Liberty I’m 25 years old and have been working in retail for almost 10 years. I am currently working as a cashier in a supermarket at an hourly wage of $7.90. I am responsible for most of the bills and daily expenses for my family. I am confident that if the Fair Wages for New Yorker’s Act passes it will change the lives of struggling low wage workers in New York. All hard working New Yorkers want to able to make a living. We all want to be paid well. We all want good jobs and benefits for our families and ourselves.” -Morenike Dagbo, NYC retail worker and member of the Retail Action Project “In addition to the necessities such as food, clothing, and shelter, I can’t afford any of the basic things that working people should be able to enjoy. My dream is to return to school so that I can complete my bachelor’s degree, go to law school, and work for social justice. A living wage would help me afford the basic necessities and save some money to work towards this dream.” -Linda Archer, McDonald’s worker at Times Square
The Retail, Wholesale and Department Store Union (RWDSU), UFCW, is proud to play a leading role in the Living Wage NYC Coalition. We urge the New York City Council to pass the Fair Wages for New Yorkers Act. It is legislation that will improve the lives of retail workers in city-subsidized economic development projects.
LIVING WAGE
NYC
Stuart Appelbaum President
Jack Wurm
Secretary-Treasurer
Sound-bites: LIVING WAGE Stuart Appelbaum, president, RWDSU The fact [is] that all taxpayers of New York City will benefit, not just workers in subsidized projects. The living-wage bill would give taxpayers a higher return on their investment in economic development and job creation. That’s very important to consider at a time when the city is trying to do more with less and thus invest public dollars as wisely as possible. We all agree that public investment in economic development, job creation and a better quality of life is vital for the future of the city. When you strip away the other side’s rhetoric, you actually find broad agreement on the core issues at stake in the living-wage fight.
Michael Saltsman, research fellow, Employment Policies Institute There’s been plenty of discussion about job loss as a consequence of a “living wage” law in New York City, but not nearly enough discussion about
who could be losing their job. New research suggests that a wage mandate is more than twice as harmful to the employment prospects of black young adults as it is to white young adults. Proponents of wage mandates will always have an emotionally compelling argument; who doesn’t want to be paid more? It’s my job to point out the unintended consequences of mandates like a “living wage,” because the rhetoric of advocacy groups is generally at odds with established economic reality.
them away. The name of the bill is very compelling, although I think it should be called the “no wage bill,” since it means that no projects will get built. In city after city, wherever wage mandates have been tried, the very people who are supposed to benefit—low-wage and lowskilled—have been hurt the most. And in New York, the impact will be felt the most in the boroughs’ neighborhoods, not in Midtown Manhattan.
Damon Hemmerdinger, senior VP, ATCO Properties
Intro 251-A would hammer small businesses. The bill’s advocates point to an exemption for businesses with less than $1 million in annual gross revenues. But the exemption does not take into account whether a business is profitable, or the other fees, taxes and mandates that the city, state and federal governments already require [that] it pay. And all the other income a small business owner earns from other locations counts toward the
New York City, particularly the boroughs outside Manhattan, is underretailed. More retail in the boroughs represents more jobs for New Yorkers, more tax revenue for city services and more shopping choices for our neighbors. But retailers don’t have to locate here. They can locate in Nassau, Westchester, Connecticut or New Jersey, and this legislation will drive
Nancy Ploeger, president, Manhattan Chamber of Commerce
exemption. So an entrepreneur who starts a small business under a franchise agreement would have to pay the mandated wage—even if they don’t have any other businesses! Small businesses will also be slammed by the bill’s administrative and reporting measures. Smallbusiness owners, too often worried about keeping their businesses afloat, are not in a position to keep track of the 30 years of financial records. Can you imagine if they were in an industry where there is a high turnover of employees? And the bill requires the developer to be responsible for making sure businesses are paying their employees the mandated wage. Since when do we have business owners policing other business owners? The end result of Intro 251-A: No small business will want to sign leases where it is told how much to pay its employees, gets buried in onerous paperwork and must open its books to its landlords.
Stay tuned For our upcoming iSSue SpotlightS Sections feature insight and observations from key government officials, leading voices from across the industry, and influential and informative editorial coverage.
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City Call
June 6 - inSurance
June 20 - energy
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May 23, 2011
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CITY HALL
th
h
Upstanding Citizen Blue Jay
I
n her thIrd year as head of the Citizens Budget Commission, Carol Kellermann continues to sound the alarm over New York’s budget problems. She spoke with about the CBC’s ideas on rising pension costs and the likelihood of teacher layoffs, how she met Sen. Chuck Schumer, and why she’s reading about Wall Street and female comedians. What follows is an edited transcript. City Hall: Your résumé includes stints working for Mayor Ed Koch and Charles Schumer. What’s it like to work for Senator Schumer? Carol Kellermann: Well, he was Congressman Schumer then, but we are very old friends. We went to college and law school around the same time [both at Harvard], so I’ve been involved with his career on and off since he first ran for the Assembly. I was his chief of staff. He’s a very smart, high-energy, challenging person to work for. CH: Did you meet in a college class? CK: There’s a story he loves to tell about how we met. I was a couple of years behind him in school, and he went door-to-door at the women’s dorms at Radcliffe with a couple of his friends, recruiting for the Harvard Young Democrats. Really, it was just a way to meet girls. They came to my door. It was three guys—Chuck Schumer, E.J. Dionne—he’s now a columnist for The Washington Post—and Cam Kerry, whose brother is John Kerry. Very smart guys, all very interested in government and politics. CH: You also worked as deputy finance commissioner for Ed Koch. Were you there during the city’s fiscal crisis in the late ’70s? CK: I was there much later, 1981–1987. I was in the second of Mayor Koch’s terms. CH: How has the city budget process changed since you were in the administration? Do you think Mayor Bloomberg’s budgets are more dramatic than past mayors’ budgets? CK: I think there’s drama because of the revenue shortage, because the picture right now is one of great fiscal distress. What’s most distinctive about Mayor Bloomberg’s budgets is that he does the budget presentation himself. CH: He’s good at it. CK: Right. He didn’t do it this time, but he has one of those little pens with the light on it, and he gets right into the details. As I recall, in the Koch administration, Alair [Townsend] did the presentation. She had a lot of flair herself. I think Mayor Koch always had a very firm command of the issues; he just didn’t demonstrate that to the media by making the presentations.
I think the size of the cuts the mayor has proposed has to hold. He noted that the revenue projections he and budget people have made are not optimistic, nor are they conservative. Often his projections are conservative, and then more money comes in than what’s projected. I don’t think that’s true this time. Between now and the end of June, when the budget is due, we’re not going to suddenly find hundreds of millions of dollars. CH: UFT thinks teachers have been unfairly targeted by this budget. Is that the case? CK: I think Bloomberg made it very clear [that] he’s not happy to do this. Also, you have to go where the money is. The Department of Education is the biggest part of the budget, and it’s been protected from other programs to eliminate the gap. And it’s where the state cut is made. It’s logical to go there. CH: What will the City Council try to bargain with? CK: I know everyone talks about contracting. Okay, look at contracting, but it’s not $400 million you’re going to cut there. Attention is going to be on the retiree health trust fund. Council members are going to want to use money from that. CH: Is that a wise decision? CK: Absolutely not. The mayor is taking some of it. He’s proposing to take $75 million from that trust this year. We’ve spoken out against that. That fund was supposed to be to defray the cost of retiree health care, and it’s been raided virtually since the minute it was created. CH: Bloomberg may be a good money manager, but there’s some disagreement over how responsible he is, in fact, for the rise in the city’s pension costs. How much of it is his fault? CK: It’s fair to say that for the first eight years the mayor gave salary increases to city employees. He said that he believed in a well-paid workforce. He raised teacher salaries by 43 percent over that time period.
CH: Does that lead people to blame the mayor for the budget more than if he weren’t explaining it with the laser pen? CK: I think everyone knows the budget is the mayor’s budget, no matter who makes the presentation.
CH: Was he over a barrel to raise them? Or was it just that economic times were good? CK: It’s both. There may not have been that much thought given to the fact that when you raise salaries you also are building that into the pension base. CBC said when you give salary increases, you should get something back from it—productivity, concessions from employees, other things that would lower cost of pensions, increasing retirement age, cutting overtime. Those things weren’t given back.
CH: Do you think the 4,400 teacher layoffs the mayor has proposed are likely to happen? CK: I’m not going to give percentages on likelihood. But
CH: Why not? CK: Well…that was the judgment at the time on the part of the mayor and his people—that they could give
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Andrew SchwArtz
Carol Kellermann, CBC president, weighs in
the increases and it would lead to a better, more stable workforce. Another part, a larger part, is the stockmarket plunge, and another part is the pension sweeteners. When you can’t get things from the mayor, you go to the Legislature and you can get them anyway. So there’s plenty of blame to go around. But it doesn’t matter whose fault it is, because we can’t punish anyone for it. CH: Best-case scenario for the mayor: The pension system is reformed. At what point do we begin to see pension costs level off? CK: I do not know. But if you started asking city employees to pay part of their health costs, you would save a billion dollars immediately, next year. You wouldn’t have to do teacher layoffs. You wouldn’t have to do any layoffs. CH: Another huge cost-driver for the city and state is Medicaid. How successful do you think the state’s Medicaid reforms are going to be? CK: Oh, there’s so much uncertainty about that. But I think people in the health-care industry realize we’ve gone as far as we can go in the old pay-for-services system, and it has to be redone. If we don’t all make cuts together, we’ll have very destructive things happen. Hospitals will close; nursing homes will be strapped. Either we all float together or we will hang. CH: Any feedback from Governor Cuomo’s office about accidentally preempting the announcement that his chief of staff, Ben Lawsky, would be running the newly created Department of Financial Services? CK: I thought the announcement of Ben’s appointment would be happening on Friday and was anxious to let our trustees know of the postponement as quickly as possible, so didn’t double-check with the governor’s office before sending my notice out. They were very nice about it. No angry phone call—or indeed any phone call at all. CH: And now for something completely different. When you’re not running the CBC, what do you read? CK: Oh, boy. I should read a lot more. A couple of years ago I joined a book group, and I haven’t made it to a single book-group session this year. But I read the books! I’m reading The Woman Who Fell From the Sky, by Jennifer Steil. It’s about an American going to Yemen and serving as the editor in chief of an English-language newspaper in Yemen. You should read it; it’s really amazing! CH: Noted. CK: And I have to read The End of Wall Street by Roger Lowenstein, which I’m reading because Roger Lowenstein is speaking at a CBC event next week. Oh, and then the next thing I’m going to read is a book my daughter gave me for Mother’s Day. Bossypants, by Tina Fey. I’m really looking forward to that. —Laura Nahmias lnahmias@cityhallnews.com MAY 23, 2011
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GOVERNOR CUOMO: Auto insurance fraud cost honest, hardworking New Yorkers $627.5 million over the past three years.
It’s time to put the brakes on auto insurance fraud! As Attorney General you helped protect consumers against fraud… and New Yorkers need you to do it again as Governor. We urge you to take the lead and work with the Legislature to reform New York’s broken no-fault system and STOP THE FRAUD TAX.
For more information, visit
www.FraudCostsNewYork.com PAID FOR BY THE FRAUD COSTS NEW YORK COALITION