MARCH 2008 3/30/08Why NYC Mega-Projects Are Falling Apart, CrainsNY. Successful development projects in NYC depend on the three legs of financing, political support and community approval. When just one of is broken, the project can weaken and, in some cases, fail. That reality has become painfully apparent in the past couple of weeks, as some of the biggest projects in the city—Atlantic Yards, Hudson Rail Yards, Moynihan Station and Pier 40—appear to be at risk. The biggest threat to Atlantic Yards and Hudson Yards is the credit crisis. Comment: There were too many projects under way at once.
3/28/08 Ray Kelly: Techie, Gotham Gazette. The NYPD’s Real Time Crime Center puts crime data and related information at the service of the City of NY, and according to Government Technology magazine is a leading use of government technology. So NYPD Commissioner Ray Kelly makes the magazine’s annual top 25 list of Doers, Dreamers and Drivers, the “best and brightest in public-sector [IT].” Comment: NYC is lucky to have him. 3/27/08Unemployment Down Because Fewer People Looking for Work, CrainsNY. Seeming good news from lower unemployment, but the reduction in the unemployment rate comes from a reduction in the number of people looking for work, i.e., a rise in discouraged workers, rather than from a reduction in the number of unemployed. Also, the tape is running behind what is happening, as layoffs are not yet recorded. Comment: The worst news is that the layoffs are in the best-paid financial-services sector. Whatever we may think about the riskiness and excesses of the financial industry in the past few years, the industry did well for NYC and its writedowns and layoffs will have serious consequences for the City's budget and services, not to mention, as time goes by, real estate
3/27/08Hudson Yards Deal, Gotham Gazette. The MTA selectedTishman Speyer to develop the 26-acre Hudson railyards site. The Daily News, likes it, especially the renovation of the High Line rail trestle into a park. The people involved in that park seem pleased as well, according to the High Line Blog. At least greenbuildingsnyc likes the developer’s sustainability track record. But Anna Levin, land-use chairwoman of Community Board 4, told the Observer that the project’s “massive commercial density is a big problem.” The Times’s Nicolai Ouroussoff called the project “miserably depressing”.and bewailed “the urban planning process” in New York. But Charles Bagli thinks it “may be years” before anything gets built over the railyards. Comment: The West Side Plan requires an enormous up-front investment. When credit got tighter it was bound to be a casualty.
3/20/08NYPD Doesn't Count a February 29 Murder, Village Voice. In order to make year-to-year comparisons fair, the NYPD reportedly ignores murders committed on February 29. The Village Voice is properly concerned. Comment: In the 1960s, the Chicago and Philadelphia Police Departments used to manipulate the crime numbers so that they went down when a candidate they liked was running for election and rose when the budget was being put together. A common problem was the elasticity of the definition of "grand larceny", which had a dollar figure associated with it that was not adjusted for inflation. As a result, the crime numbers went up each year because it became easier to pass the dollar figure. Some years the FBI would fail to include some cities' crime data because they appeared to be incorrect. Milwaukee's mayor Maier had a simple solution - he had the crime figures audited.
3/6/08 Foreclosures jump in Queens, Brooklyn, Crains NY. According to a Propertyshark. com report that tracks first time foreclosures, New York City foreclosures increased 13% from January, and 113% from February '07. Comment: The dreaded housing downturn seems to have reached at least two of NYC’s boroughs.
3/6/08 Polytechnic board approves NYU merger, Crain’s NY. More than three-fourths of the 35 members of the Poly board voted for the merger. Now the merger awaits approval from the NY State Education Department and Board of Regents by June. Comment: NYU’s sale of its engineering school was good for NYU’s finances at the time but was bad for NYC. The merger with Polytechnic appears to be good for both. A happy ending, it seems.
3/6/08 City unemployment jumps in January, Crain’s NY. The city's unemployment rate rose to 6.1% in January, compared with 5.2% in December and 5.3% in January 2007. Comment: The increase in December was unremarked. The new increase of 0.8 of a percentage point is hard to ignore.
FEBRUARY 2008 2/22/08Commission on Property Tax Relief, Albany. Gov. Spitzer has stated: “Ever-growing local property taxes impose a tremendous burden on New York taxpayers, force seniors out of their homes, drive our young people out of our state, and discourage the formation and expansion of businesses. Our efforts to address this crisis – including unprecedented increases in State education aid and more than $5 billion in STAR school tax relief – have not slowed the growth in local property taxes. We need to explore new approaches, including reducing unfunded mandates and placing a cap on the growth of school property taxes. The creation of this Commission is the first step in this process.” Comment: This is unlikely to be of much value to NYC residents, because property taxes are lower (NY City makes up for it with income taxes).
2/17/08 Mayor Bloomberg Eyes Creating Web Site, Daily News. Mayor Bloomberg's future may not involve the White House as much as it does a computer mouse. As talk of a presidential run wanes, the mayor has another plan for his next big act in the body politic: a Bloomberg terminal for government. "That's one of things I want my foundation to work on," the mayor told Wired magazine in December. "People don't know who they're voting for. They don't know the politicians' qualifications. We continue to elect people who have no abilities whatsoever."
2/13/08 IBO Issues Budget-Cutting Ideas. The Independent Budget Office issued a long list of ideas for cutting the budget by raising revenues or reducing spending. Comment: The Manhattan Institute will be pleased to see some of its ideas, for example on pensions, incorporated in the IBO list. An early news item on the IBO study said (until I brought it to the paper's attention) that the IBO is suggesting that the municipal work week be increased "by 40 hours." The report is Draconian indeed, but is not recommending a 75-hour workweek. The IBO report actually says (p. 21) that the workweek should be increased to 40 hours.
2/13/08 Citing Hard Times, Quinn Vows to Cut Council's Budget. The NY City Council needs to take its share of cuts in hard times, said City Council Speaker Christine Quinn in her State of the City speech. She promised that the Council's budget will be reined in. To help the economy, she proposed a one-week sales tax holiday. Comment: With 51 Council members, that's more than $1 million a year per Council Member. But the committees and leadership account for about 280 employees and individual Council members are left with $277,000 plus an extra $40,000 if they head up a committee. From a Council member's point of view it's hard to run an office on that budget and the possible savings are tiny in the face of NY City's $58 billion budget. To which the only response can be Durable Dictum #1.
2/12/08 Suit against NYC Campaign Law Claims Racial Bias, NY Times. In a law suit described as a "stretch", a group of real estate and other business interests are taking on a City Council law that limits campaign contributions from real estate and other businesses that are selling to or are regulated by the City. Comment: The lawyer taking on the case won a similar suit in Vermont, but it was not tied to doing business with the government. Mayor Bloomberg says he supports the intent of the NYC law, whatever the courts decide about its constitutionality.
2/8/08 Who Gains and Loses from Tax Breaks?Gotham Gazette, Glenn Pasanen. The City Council is taking a closer look at tax breaks and ended one for Madison Square Garden. Comment: Small tax breaks are commonly favored by legislators because the winners are very grateful and the losers are dispersed and unaware. The problems grow when the breaks are extended more broadly. A problem area not mentioned by Gotham Gazette is that of the PILOTs - payments in lieu of taxes. They were very small relative to the NYC budget until the last few years, when - starting with Battery Park City - they have ballooned along with incentives for development in designated areas such as near Ground Zero and the Upper West Side. The problems with PILOTS are multiple. They may be set lower than property taxes would be and may also be fixed so that they don't increase along with property taxes. They therefore raise the burdens on the rest of the City's taxpayers.
2/4/08 Asian-American Leader Pulls Out of Minority Business Program, CrainsNY. John Wang, President and Founder of the Asia-American Business Development Center, pulls out of the minority business program because the flame is not worth the candle. Too much certification is required, he says, for not enough reward in terms of NYC contracts.
JANUARY 2008 1/31/08 NYS Restaurant Association Sues to Stop Diners at Fastfood Chains Finding Out How Much They Are Eating, Crain's NY. The New York State Restaurant Association has filed a federal lawsuit today to block Mayor Bloomberg's effort to require the large chains like McDonald's - about 10 percent of NYC restaurants - to list calorie information on their menus clearly. The law suit in U.S. District Court in Manhattan was filed 10 days after the NYC Board of Health passed the new rule, effective March 31. Comment: The NYSRA website does not disclose who their members are on the "Who We Are" site or the NYC site. Do the chains know what the NYSRA is doing in their name? 1/30/08 Traffic Safer in NYC (but Bicycle Fatalities Higher), NY Post. Pedestrian fatalities in 2007 fell to 136, a 13 percent decrease from the previous lows of 156 in 2004 and again in 2005. Driver and passenger deaths fell to 77 from 113 in 2006. But 23 bicyclists lost their lives in 2007, compared with 18 in 2006. And 35 motorcyclists died, up from 23 in 2006. Overall, the 271 traffic-related deaths were the lowest in city history, down from the previous low of 297 in 2004. Comment/Query: The new lane dividers (e.g., on 9th Avenue south of 23rd Street) are very helpful to pedestrians. Are they working less well for cyclists? 1/29/08 NYC Unemployment Rises to 5.2 Percent in December, Bureau of Labor Statistics. Not reported at all in the media on January 30: NYC's unemployment rate rose to 5.2 percent in December from 4.0 percent a year earlier (Table 1 in the BLS release). Based on establishment payroll data, the NYC metro division (a subset of the metro area, including NYC, White Plains and Wayne, NJ - see Table 4) showed an increase of 62,000 in employees, a rise over the year of 1.1 percent. So businesses were hiring. Comment: The labor force in the NYC metro division (Table 2) rose 36,900, but the number of unemployed in the division rose by 52,000 (from 214,100 to 266,100). In NYC (Table 1) the number of unemployed rose 44,700 over the year, from 153,700 to 198,400. That's the other end of the economy from the Manhattan condos and coops that have been holding up well in the face of housing-price declines in the rest of the country. 1/24/08 City Hired Thousands Since Job Freeze, NY Daily News. Since the job freeze was announced in October, 12.,000 new employees have been added. This by itself does not prove that no attention is being paid by agencies to Mayor Bloomberg’s freeze. What is the ratio of filled vacancies to total vacancies. The freeze might be mushy if 90 percent of vacancies are being filled, but it might be considered very effective if only 60 percent of vacancies are being filled. 1/23/08 Mayor Bloomberg names director of his Manufacturing and Industrial Development office, CrainsNY. Leslie Ramos will seek to retain or grow jobs in the ailing industrial sectors. 1/17/08 Mayor Bloomberg Calls for Foreclosure Assistance and Prevention. The Mayor promises help to help families buy and keep their homes, via the Center for New York City Neighborhoods. It will assist families most affected by the sub-prime mortgage crisis,'' the mayor said. ''Keeping housing affordable is essential to remaining a city that welcomes the middle class.'' Comment: This initiative follows the meeting in Detroit of the US Conference of Mayors at which the the Mortgage Bankers Association promised: (1) to donate $100 for every property in foreclosure -- about 1 million properties -- to hotlines designed to help people avoid foreclosure, (2) to maintain a database, already started, of loans in foreclosure to allow city officials to find out which lender is responsible for a foreclosed house and who is servicing the loan, and (3) to make its studio in Washington available to mayors to film a public service announcement about foreclosures. 1/11/08 Governor Spitzer Proposes Fund for Upstate Economic Development, Star-Gazette. The fund would be used for infrastructure improvements such as bridge renovation in Poughkeepsie and downtown renewal in Rochester. The fund would be created by selling unused state assets or by borrowing, with differing reports on the mix. 1/10/08 State of the State: "One New York". Governor Spitzer's "One New York" report is concerned with rising property taxes. He express concern about education, health care, infrastructure and development. Independent reports suggest he will be seeking to create funds or endowments for higher education, upstate development and other projects. 1/10/08 Environmental Groups Suing NY State. They argue that standards for brownfields cleanup were too lax. 01/10/08 Mayor Bloomberg Warns about AIDS Risk. With his anti-smoking initiatives showing success and wide imitation, Mayor Bloomberg is lecturing those of his constituents who will listen about AIDS risks from needles and sexual activity, saying that 20 percent of NYC adults may be taking such risks. 01/10/08 One-Third in a Survey Support Congestion Pricing, Crains NY. If funds will go to mass transit, more New Yorkers support the idea, but still only a minority. 1/9/08 Time to Get to Work, Assemblyman Richard Gottfried, Albany Times-Union. A lot got done in 2007 despite the turmoil, says Gottfried, but a lot more needs action and it will happen faster without so much conflict. 1/3/08 Apartment Prices in NYC Continue to Defy National Trend, NY Times. NYC average apartment prices refuse to follow the national trend and wilt in the face of the subprime crisis. Buyers are still eager at the high end. Other NY Times stories, however, identify individuals who (1) are arbitraging between the city and suburban markets by selling their coops and buying in the suburbs or (2) can’t afford to remain in the City on an artist’s income and are seeking to move.