Pataki's Man in Harlem

How Randy Daniels Helped Put Chain Stores and Market Prices Uptown

"People have to be mature and sophisticated enough to understand the difference between a political fight and a personal vendetta," he said. "And the farther people get away from the principals, the less informed they are about what has happened. If they need me, they call me."

The transformation of Harlem really began with the formation of the Harlem Urban Development Corporation (HUDC) in 1971 as a subsidiary of the Urban Development Corporation (UDC), which then governor Nelson Rockefeller devised in memory of Martin Luther King Jr. The goal was to spur economic development in the state's urban areas in the wake of the late-'60s riots, and the abandonment of cities by the federal government and the private sector during the Nixon years. With over $1 billion, UDC could establish bonds, condemn buildings, override zoning, and change building codes. HUDC's charge, said former president Donald Cogsville, was to "work with other community-based institutions to come up with an overall re-development plan, and implement that plan."

According to agency records provided to the Voice, over a 24-year period HUDC transformed approximately $89 million in state funds into an estimated $500 million worth of housing and commercial development by providing seed money. Yet in a smear campaign spurred by Pataki administration leaks to the Daily News two years after HUDC's 1995 demise, the agency was burned in effigy. Accounting irregularities, political cronyism, gross incompetence, and worst of all, having nothing to show for the millions of dollars it received, were a few of the charges—and they persist.

In 1995, the Pataki administration, as black Republican lawyer and politician Joseph Holland put it, "did not eliminate HUDC; they revamped it to the Harlem Community Development Corporation (HCDC), bringing in new people, who brought a new direction." No matter the spin, according to inside sources, even though HCDC has had several executive directors in its eight-year existence, Daniels in effect ran the group from 1995 to 1999, while serving as ESDC's deputy commissioner.

Daniels gives Pataki credit for the new Harlem, saying economic activity "really took off when the governor said, 'I'm going to reform economic development by closing down the ineffective HUDC, and funding the Empowerment Zone, holding it accountable, and telling ESDC that we should do on 125th Street what we have done for 42nd Street.' "

Diane Philpotts, HCDC's current director, returned Voice calls, but was unable to give an interview without an OK from the ESDC, and the state agency never granted that permission. This we-can't-trust-you-Negroes thinking is, in part, why HUDC had sought and obtained fiscal freedom in 1982 from its parent agency, UDC. In 1995, when HUDC was "revamped," UDC became the Empire State Development Corporation, and overseer of the agency. "They [HCDC] can't make any independent decisions," said Jim Capel, Rangel's chief of staff. "They must go through downtown for anything they want to do. That was one of the issues with HUDC: Let the people in the community decide what they want to do with the money." He also said that HUDC's problems began when it became independent.

HUDC, on average, received approximately $4 million per year. According to Cogsville, over its 24-year tenure, HUDC hired qualified minority architects, general contractors, auditors, insurance firms, and others in 65 to 90 percent of cases. The new agency's budget was put at half that of HUDC's at inception in 1995, and, according to state records, has remained between $2 million and $2.5 million.

When asked about HUDC, Daniels mentioned a 1989 published report by former city auditor general Karen Burstein. The report concerned HUDC's management of a city-owned parking garage on 125th Street and Lenox Avenue, below the site for the then planned Harlem International Trade Center. Burstein found that gross operating revenues were understated, that basic rents were due, and that operating expenses were overstated. Few people interviewed for this article, even those with good things to say about HUDC, would defend its management of the garage. "Most of the money went for payroll and overhead. It didn't go into development," charged Daniels. "Nobody is saying that they stole the money. It was mismanaged. When 80 percent of your money goes into administration and overhead, and only 20 percent goes into projects—it's supposed to be the reverse. It was a jobs program, not an economic development program, and we changed that."

In its last years, HUDC had 50-60 people on staff, many of whom were professionals with long tenure. If staff members averaged $40,000 to $60,000 per year in 1995, salaries would total $2 million to $3 million, an amount Cogsville confirms. Even if one argues that HUDC was overstaffed, it is important to acknowledge that HUDC did lay the foundation for today's wildfire of development in Harlem. Elois Banks, a former district leader with Councilman Fred Samuels and current head of the Strivers Row Block Association, said, "HUDC started the renaissance in Harlem by re-modeling buildings and bringing in co-ops."

HUDC was responsible for the rehab or building of thousands of housing units for moderate- and middle-income families, spruce-up work on thousands of brownstones, and organizing the local groups that began the Bradhurst development project in a blighted area between 144th and 155th streets. The agency made a neighborhood-by-neighborhood plan in 1979, and helped design the Upper Manhattan Empowerment Zone. Two other HUDC projects, Harlem on the Hudson and the Harlem International Trade Center, did not happen, but Pataki and Mayor Bloomberg issued a plan for the West Harlem Piers just before the gubernatorial election.

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