Affordable Housing Gets Sacked

Battery Park City's funds intercepted by the city's big west side project

It's not uncommon for urban renewal to wipe out the diversity of a neighborhood as it destroys affordable places to live. But the Jets stadium/Javits Convention Center project for the West Side has tentacles longer than most others: It would suck the life out of neighborhoods as far away as Battery Park City and the Bronx.

Nestled into the glossy illustrations of the proposal for the West Side rail yards around 34th Street is a proposal to pay for the city's $350 million portion for the convention center with revenues from Battery Park City—even though the city still hasn't made good on a promise to use that money to build affordable housing in places like Harlem, the Bronx, and Brooklyn. If the West Side project goes forward, the city will break its promise and pass up an opportunity to create hundreds of apartments New Yorkers can actually afford.

The story goes back more than 40 years, to when Battery Park City was a stretch of Hudson River landfill created from the excavation of projects like the adjacent World Trade Center. In the 1960s, Chase Manhattan Bank's David Rockefeller, Governor Nelson Rockefeller, and Mayor John Lindsay all wanted to build luxury apartments on the site to ease the commute for Wall Street execs. But in 1969, liberal Democrats, angered that the public project was for luxury apartments when affordable housing was in short supply, extracted concessions that a third of the units in Battery Park City would be for low-income tenants and a third for middle-income ones. With profits from the project also financing housing elsewhere in the city, the plan was to create 60,000 affordable apartments.

Soon, however, the Battery Park City Authority had worked its way out of that obligation and returned to plans to build for the luxury market. In the '80s, during Governor Mario Cuomo's administration, the authority signed an agreement to use profits from its development projects to provide $1 billion in cash and bonds to finance housing renovation elsewhere in the city.

But after about 1,500 apartments were built or renovated in Harlem and the Bronx, the city stopped using the money for housing. Today, though the authority continues to provide the city tens of millions of dollars per year and has outstanding promises to the city to back $257 million in bonds with Battery Park City revenues, the city has not undertaken any new housing projects with the money. Last month, Mayor Bloomberg asked the state for permission to use Battery Park City profits to finance the convention center/stadium project instead.

Affordable housing isn't built elsewhere in the city, but it isn't being built in Battery Park City, either—and it could be. "We've got too many yuppies," James F. Gill, the chairman of the Battery Park City Authority, said in 1999. "I mean, we like yuppies. But enough already." Battery Park City has more today. And it's losing the diversity it had. BPC grew by over 1,000 households from 1990 to 2000, but it lost 488 middle-class households (those earning $30,000 to $75,000). The big gains were in apartments for people making over $100,000—1,251 new ones. Today, almost one in five households in Battery Park City makes more than a quarter of a million dollars a year.

And this does not sit well with Battery Park City residents. "I like a diverse community," says Joanne Chernow. "I know I'm not the first person to say that down here." Residents want affordable housing and are fighting now to preserve rent regulation in Gateway Plaza, home to almost 3,000 people. But there are no plans to build more affordable housing on the vacant lots that remain in Battery Park City, though the authority could afford to do so.

Plenty of Battery Park City residents enjoy the waterfront park and the quiet of the neighborhood, but they also want New York's vitality. Manohar Kanuri says his neighborhood offers "the best of both worlds."

But while the authority has produced a surplus for almost 20 years, it still sticks to luxury-rate buildings. (Some middle-income apartments have been built in Battery Park City, because less expensive financing is available through the "80-20" program, which sets aside some units for the middle class. But these make up a small share of the neighborhood.) With the added burden now of producing the city's subsidy for the convention center, the Battery Park City Authority will have to continue sacrificing neighborhood diversity for revenues sent uptown.

As The Battery Park City Broadsheet reported, while Bloomberg and Pataki are among those backing the development plan, others, like State Assembly Speaker Sheldon Silver, Public Advocate Betsy Gotbaum, and City Councilman Alan Gerson, oppose the drain on Battery Park City finances. But because the authority's members are appointed by the governor and control its finances without legislative oversight, the plan could go forward against objections.

And that would have ramifications for the rest of the city. When the plan for Battery Park City-financed apartments off-site was announced, housing activists were optimistic it would be a seed that would spur broader redevelopment of areas like the South Bronx. But the seed hasn't been planted.

Housing activists have tried repeatedly to get the city to put into action its plan to use Battery Park City profits to build housing, but with little success. "It's a plan that's gone completely out of control," says Victor Bach, of the Community Service Society. When a coalition of groups pushed the Giuliani administration to use $46.6 million it received from Battery Park City in 1999 to build affordable housing, the city refused, citing a loophole in the agreement that allowed the city to use Battery Park City money for other purposes if the city was experiencing a fiscal crisis. Three days later, the city announced a budget surplus of $3.2 billion, the largest in its history. And despite promises to build affordable housing, so far Bloomberg has continued Giuliani's policy.

Now, just as the city eyes Battery Park City's money for the stadium/convention center project, the agreement with Battery Park City to use its surplus for housing is up for renewal. "The fundamental problem remains that the city has failed to carry out the moral, political, and fiscal promise that defined the public purpose of the BPCA, as laid out in state legislation, and particularly the December 1989 agreement between the city and authority," says Glenn Pasanen, who teaches political science at Lehman College and writes for the Gotham Gazette. "So I think the current proposal to finance the Javits Center should not be approved until there is a recommitment by the city and authority—to the original $600 million level—to using future authority excess revenues for affordable housing."

But if Bloomberg is successful, Battery Park City will help finance a place of business for a New Jersey-based football team—whose game tickets most New Yorkers won't be able to afford. And if the city funds the stadium with money earmarked for housing, many also won't have a home where they can watch the games on TV.

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