Porn Free

The city's war on sex shops has nothing to do with morality and everything to do with development. Especially around Times Square.

Messinger's approach -- reduce intrusive signage and provocative window displays, zone away from schools and churches -- corresponded to this popular consensus, yet it was rejected by Manhattan's three dailies. Why did they all back the mayor's far more draconian plan? And why did they hammer home the issue in editorial after editorial (seven in the Times and three in the News) despite the relative indifference of the public at large? The answer has less to do with ideology (except in the case of the Post) than with the fact that both the Times and the News hold executive positions in their local BIDs.

Times publisher Arthur Sulzberger Jr., who currently chairs the nominating committee of the Times Square BID, was its founding chair. Sulzberger headed the search committee that hired Gretchen Dykstra -- the most visible civilian in the city's war on porn -- to run the BID. Its early meetings were held at the Times's offices.

A spokesperson for the Times notes that Sulzberger has no corporate affiliations other than at the paper. But that alone qualifies him as a major player in the development of Times Square. This financial stake may explain why real-estate action in that area regularly receives such massive coverage in the paper of record. Last Thursday, for example, a front-page picture touted the fact that Cabaret is about to reopen in the building where a crane collapse wreaked havoc last month, and on the front page of the Metro section that same day, a lavishly illustrated story concerned the imminent arrival of Times Square's biggest sign.

Of course, there are other major players in the area: Tishman, Rudin, Zeckendorf, Durst. A number of these realty titans are represented on the Times Square BID, along with hoteliers, theater owners, and corporate leading lights like Bertelsmann and Morgan Stanley. What attracted these companies in recent years was the cornucopia of tax breaks given by the state and city. The Giuliani administration has granted a record $666.7 million in tax abatements, the lion's share of which went to businesses locating in Times Square.

"The market there was historically not strong enough to support new construction," says one realty insider. "But the city made a major investment in subsidizing office space and even retail, and now the market has its own momentum. In that sense, there is a chance for a very significant return to the city on its investment." That payback will come in the form of taxes levied on newly profitable realty-to-retail businesses.

Nowhere is the rush to cash in more frenetic than on the cutting edge of Times Square development, Eighth Avenue. The recent transfer of theater-district air rights has made that thoroughfare even more of a plum, and several hotels with retail components, as well as a major new cineplex, are about to go up. There's only one hitch. "Everyone's doing family entertainment these days," says the realty insider. And Eighth Avenue happens to feature the city's biggest cluster of adult businesses.


Maintaining the momentum of this building boom is crucial, which is why the city has moved with such unprecedented harshness against the sex shops. "If you have a change in zoning," says Siegel, "first there's a grace period, then a discussion with the owners, and even when a violation is issued, there's time for the businesses to comply. None of that has happened here, and the reason is obviously to put them out of business."

Sex shops, let it be noted, are not unprofitable. In the old Times Square, the owners of such establishments were willing to pay landlords double, sometimes triple, what other retailers could afford. As long as that was the case, no matter what the Times and Broadway theater owners might think, erotic entertainment was a fact of life around the Great White Way. But once the state's Urban Development Corporation formed the 42nd Street Development Project in 1982 and began condemning properties along "the Deuce," the fix for porn was in. The Disney Corporation made it a condition of its investment on the street that sex shops be moved out. The city -- and the soon-to-be-formed Times Square BID -- were all too happy to help.

BID memos show that Dykstra met frequently with officials from the Department of City Planning, which made extensive use of the BID's privately funded study in its own report on the unsavory impact of adult businesses. She had a determined ally in City Planning Commission chair Joseph Rose, the real estate scion who happens to have a financial interest in a 200-unit building on Eighth Avenue and 52nd Street. Then there's Frederick A.O. Schwartz Jr., Ed Koch's corporation counsel, who represented the Times Square BID pro bono, and personally argued the city's case before state and federal judges. Schwartz is a partner in Cravath Swaine & Moore, whose offices are located in Zeckendorf's Worldwide Plaza on Eighth Avenue. This prestigious law firm refused to move into the building as long as there was a gay porn theater nearby. (Using the health code, the city shut it down in 1994.)

Under Dykstra, the Times Square BID orchestrated a masterful campaign on behalf of the mayor's new zoning plan. She was tireless in appearances at block associations and community boards; she solicited celebrities such as Carol Burnett to testify at the City Council when the zoning was being considered; she wrote personally to "relevant commissioners,Ó "selected judges," and even the FBI (which, one memo notes, was "noncommittal" about getting involved); she even went undercover to study the industry.

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