EDC Preliminary Budget Hearing March18, 2010

8/9/2019 EDC Preliminary Budget Hearing March18, 2010

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CITY COUNCILCITY OF NEW YORK

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TRANSCRIPT OF THE MINUTES

of the

JOINT COMMITTEES ON ECONOMIC DEVELOPMENTAND SMALL BUSINESS

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March 18, 2010

Start: 12:00 pm approx.Recess: 4:31 pm approx.

HELD AT: Council ChambersCity Hall

B E F O R E:

DIANA REYNAChairperson, Small Business

COUNCIL MEMBERS:Council Member Margaret S. ChinCouncil Member Mathieu EugeneCouncil Member Julissa FerrerasCouncil Member James F. GennaroCouncil Member Sara M. GonzalezCouncil Member Letitia JamesCouncil Member Brad LanderCouncil Member Stephen T. LevinCouncil Member Melissa Mark-

ViveritoCouncil Member Annabel PalmaCouncil Member Ydanis RodriguezCouncil Member Larry B. SeabrookCouncil Member Albert VannCouncil Member Mark S. Weprin


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A P P E A R A N C E S [CONTINUED]

Diana ReynaOpening Statement Re: Economic Development CorporationChairperson

Committee on Small Business

Seth W. PinskyPresidentNew York City Economic Development Corporation

Jason WrightChief Financial OfficerNew York City Economic Development Corporation

Diana Reyna thanks the staff of Committee on SmallBusiness and Committee on Economic Development

Diana Reyna read letter from Lucky's Real Tomatoesinto the record

Sara Gonzalez, through Brad Lander, thanks DeputyMayor Lieber, staff at EDC especially Ashley Cotton,Andrew Genn, and Josh Nachowitz

Bomi KimMWBE ProgramNew York City Economic Development Corporation

Diana ReynaOpening Statement Re: Department of Small BusinessServicesChairpersonCommittee on Small Business

Robert W. Walsh

CommissionerDepartment of Small Business Services

Andrew SchwartzFirst Deputy CommissionerDepartment of Small Business Services


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Angie KamathDeputy Commissioner of Workforce DevelopmentDepartment of Small Business Services

David MargalitDeputy CommissionerBusiness Development and Agency StrategyDepartment of Small Business Services

Anne RasconDeputy CommissionerDivision of Economic and Financial OpportunityDepartment of Small Business Services

Gregg BishopAssistant CommissionerBuyer ServicesDepartment of Small Business Services

Jeremy WaldrupAssistant CommissionerDistrict DevelopmentDepartment of Small Business Services

Katy GaulAssistant CommissionerWorkforce1 TrainingDepartment of Small Business Services

Tracie AbbottAssistant CommissionerStrategic Initiatives and System IntegrationDepartment of Small Business Services

Shanna GumaerAssistant CommissionerWorkforce1 Career Center System PerformanceDepartment of Small Business Services

Zenon WalcottAssistant CommissionerDepartment of Small Business Services


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Bernadette NationDirectorCustomer Service Center

Business Express UnitDepartment of Small Business Services

Don GiampietroAssistant CommissionerBusiness IncentivesDepartment of Small Business Services

Christina ShapiroAssistant Commissioner

NYC Business SolutionsDepartment of Small Business Services

Colleen GalvinAssistant CommissionerVendor ServicesDepartment of Small Business Services

Daria HirschChief of StaffDepartment of Small Business Services

Other Deputy Commissioners and StaffDepartment of Small Business Services

Glenda M. SelfProject H. I. R. E.

Janet TorresDirectorGovernment and Community Affairs

Wildlife Conservation SocietyCultural Institutions Group

Appearing with Janet TorresColleagues from Cultural Institutions Group:El Museo del BarrioNew York Botanical GardenBrooklyn Museum New York Aquarium


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Leah ArchibaldExecutive Director

EWVIDCO

Calvin ArchibaldPresidentTremont Business and Community Organization

Sarah CreanDeputy DirectorNew York Industrial Retention Network

Presented written testimony:Greg MaysDowntown Jamaica Open Space Coalition

Josephine InfanteFounderHunts Point Economic Development Corporation

Stephan HyacinthCoordinatorPort Morris Industrial Business ZoneSouth Bronx Overall Economic Development

Justin K. RodgersDirectorEconomic DevelopmentGreater Jamaica Development Corporation

Claudia FitzpatrickOwnerPrestige Environmental Services

Pete MestousisMestousis EnterprisesOwners of several businessesHunts Point area in the Bronx


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Gayle BaronPresidentLong Island City Business Development Corporation


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1 COMMITTEES ON ECONOMIC DEVELOPMENT ANDSMALL BUSINESS

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CHAIRPERSON REYNA: Good afternoon.2

I apologize for being a little late. A lot's3

happening and I just wanted to welcome our4

Economic Development Committee. My name is Diana5

Reyna and I chair the Small Business Committee but6

I am filling in for our Chair of Economic7

Development Thomas White who could not be here8

today due to other health commitments. And so I9

wanted to just fill in the opportunity to chair10

this hearing, the Fiscal 2011 Preliminary Budget11

for the Economic Development Corporation.12

In this hearing the Economic13

Development Committee would like an explanation on14

how EDC's capital budget is affected by the15

Administration's decision to stretch out the16

capital plan from four to five years, reducing the17

current year's capital plan by nearly 20%. In18

addition the Committee would like to know the19

current status of EDC's capital access program20

which will assist small businesses in accessing21

credit to allow them to start, expand and/or22

maintain their businesses.23

Lastly the Committee is interested24

in knowing about the current status of the Mayor's25


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Office of Industrial and Manufacturing Businesses,2

one of my very most important priorities. Will3

the Office stay in the Department of Small4

Business Services and if not can it be returned to5

the Economic Development Corporation's portfolio?6

What would happen to the contract7

service providers? Obviously our service8

providers are a key component to maintaining the9

IBZ's and I would like to thank our President,10

Seth Pinsky for joining us here today and we will11

now hear testimony.12

MR. SETH W. PINSKY: Thank you13

very much Chairwoman Reyna and members of the14

Economic Development Committee. My name is Seth15

Pinsky. I'm the President of the New York City16

Economic Development Corporation and together with17

Jason Wright our Chief Financial Officer and other18

members of my staff, I'm very pleased to present19

EDC's Executive Budget for Fiscal Year 2011.20

I have a brief presentation on our21

agency's agenda for the coming year. And I will22

also go through the operating capital budget which23

should support our plans. After the presentation24

I will of course be happy to take questions.25


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As you well know over the last year2

or so the City has faced a number of economic3

challenges. Today the City's unemployment rate4

stands at 10.4% which is 2.9 points higher than5

the same period last year. In fact the latest6

statistics from the State Department of Labor7

reported that over the past 12 months the City8

lost some 78,100 private sector jobs.9

We've also dealt with a very soft10

commercial real estate market. Total Manhattan11

Class A office vacancy rates stand at 8.5%, an12

increase of 2.1 points from the same time last13

year. Meanwhile in January the number of building14

construction project starts citywide decreased15

both in number, dropping 53%, and value, declining16

40%, versus the same time period the prior year.17

Despite these challenges we are18

seeing the first signs of recovery in our City's19

economy. For example according to the20

Administration's latest projections it is now21

estimated that job losses in the City from the22

peak of employment prior to the downturn to the23

recession's trough will come in at a figure that24

is about 100,000 fewer jobs lost than had been25


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projected last June.2

Among the reasons for this3

improvement in outlook at the continued stimulus4

that the public sector, Federal, State and City5

are pumping into the economy, reflected in the6

number of infrastructure projects started7

citywide. These starts have increased 80% in8

number and 139% in value since December of last9

year.10

As a result, as difficult as the11

downturn has been and it certainly has been12

difficult for many New Yorkers, the silver lining13

is that New York City has generally performed14

better than the rest of the country with the15

percentage of jobs lost during the recession here16

currently at 3.4%, a figure that is roughly half17

the equivalent figure for the nation as a whole.18

Not surprisingly as with the City's19

operating budget, EDC's operating budget has been20

impacted by the economic downturn. When I21

testified before you last May our projected Fiscal22

Year 2010 operating deficit stood at approximately23

$21 million. To address this gap we instituted a24

number of cost saving measures while also25


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leveraging resources to keep projects moving2

forward and generating significant new revenue.3

Due to our efforts our Fiscal Year4

2010 deficit is now projected to come in at $125

million. Going forward we will continue to look6

for innovative ways both to generate new revenue7

and cut costs and hope that during Fiscal Year8

2011 we will succeed in reducing our operating9

deficit even further.10

While working to reduce our11

operating deficit during Fiscal Year 2010, we have12

continued to make substantial contributions to the13

City's efforts to reduce its budget gaps. As you14

can see during Fiscal Year 2011 we project that we15

will be making additional payments to eliminate16

the gap or PEG payments to the City totaling $2.117

million, an increase of $1.8 million over Fiscal18

Year 2010.19

By Fiscal Year 2014 we project that20

this figure will have risen by yet another $6.921

million to a total annual figure of $14.9 million.22

As you are aware the reason these so-called PEGs23

hit New York City Economic Development24

Corporation's budget in the form of payments25


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rather than expense cuts is that unlike City2

agencies, EDC does not generally rely on tax levy3

funds from the City for its operations but instead4

generates the lion's share of its revenues from5

its own activities.6

As a result of the foregoing,7

between Fiscal Year 2010 and Fiscal Year 2014,8

EDC's total PEG payments to the City are projected9

to come in at $80.3 million. Together with the10

other annual payments that we make to the City11

which come in the form of payments in respect of12

our annual contract with the City and one-time13

extraordinary payments received in Fiscal Years14

2009 and projected to be received in Fiscal Years15

2013 and 2014 resulting from land sales16

transactions, by Fiscal Year 2014 we project that17

the total amount that EDC will have paid over to18

the City of New York during the Fiscal Year '10 to19

'14 period will equal more than $200 million.20

Turning now to our capital budget,21

you can see from this slide that approximately22

$2.3 billion is now allocated for all EDC managed23

capital projects for Fiscal Year '10 and '11. The24

majority of our budget, about $1.4 billion or 50%25


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consists of capital for commercial and mixed use2

development initiatives. These include projects3

to strengthen our central business Districts such4

as Downtown Brooklyn, Downtown Jamaica, 125th

5

Street and Long Island City.6

These also include neighborhood7

redevelopment projects in areas like Willets8

Point, Coney Island, the Staten Island Home Port9

and Hunts Point as well as waterfront development10

projects at facilities like the Brooklyn and11

Manhattan Cruise Terminals.12

Meanwhile $212 million or 9% of our13

capital budget is allocated to improvements to14

City owned industrial sites managed by EDC,15

including the Brooklyn Army Terminal, the Hunts16

Point Food Distribution Center and Bush Terminal,17

markets like Essex Street and La Marquetta and18

waterfront bulkheads and structures throughout the19

five Boroughs.20

Another 6% of our capital budget or21

$140 million funds improvements by the Brooklyn22

Navy Yard Development Corporation which manages23

its own capital projects but is funded through24

EDC. A further $114 million or 5% of our capital25


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budget is allocated to investments in community2

projects that support commercial and local3

development including streetscape improvements and4

the remaining 30% of our budget, about $6765

million is allocated to projects that EDC manages6

on behalf of other City agencies.7

These are typically projects that8

are tied to an economic development initiative9

with the majority involving the Department of10

Parks, Cultural Affairs and Housing Preservation11

and Development. Projects in this category12

include capital investments aimed at creating13

recreational access to Randall's Island, expanding14

the Museum of the Moving Image in Queens, and15

building affordable housing at Hunters Point South16

in Long Island City as well as the Seaview Senior17

Living Center in Staten Island.18

As we continue to expand the City's19

economy for the future we in the Bloomberg20

Administration are well aware of the fact that the21

world is changing and indeed has already changed22

around us. Technology has lowered barriers to23

entry that traditionally kept competitors out of24

industries in New York, in which New York was25


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dominant. We live in a far more mobile world,2

giving the best and brightest, our greatest3

natural resource, the ability to pick up and4

choose among cities, states and even nations.5

And the dominant role that the6

United States has traditionally played in the7

world economy is not something that can be taken8

for granted any more. But in times past when New9

York has been at similar inflection points where10

its dominance has been threatened the City has11

always risen to the occasion, made the right12

decisions and reinvented itself in a way that13

allowed it to emerge a better and more prosperous14

place than it had previously been.15

Today we believe that the time has16

come for our City to do this once again. We must17

transform our City into the capital of 21 st Century18

innovation. This transformation must happen along19

two axes, physical and economic. The first way in20

which the City, we believe, must transform itself21

involves physical transformation.22

Put simply, our City cannot compete23

with 21 st Century rivals using a physical plant24

that in many cases is decades or more old. And25


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this is why in the next several years we at EDC2

will focus our attention both on restoring what3

was and on creating what has not yet been. Not4

just through investments and basic infrastructure5

like pipes and wires but through investments in6

amenities like parks, cultural facilities and in7

some cases whole new neighborhoods.8

When I last testified before you, I9

told you about our aspirations for several major10

development projects. And I'm happy to report to11

you today that we are making good on those12

promises. In Brooklyn the Administration's vision13

to restore the iconic character of Coney Island14

has passed significant milestones since our last15

appearance before you in May. Thanks to the16

support of the Council, the Administration's plan17

to create a 27-acre amusement and entertainment18

District together with 4,500 units of new housing19

and 500,000 square feet of new retail space20

successfully completed the rezoning process in21

July. Following that we closed on the acquisition22

of a 7-acre amusement parcel located on the23

waterfront bringing the total amount of property24

the City now owns with the amusement area to 90%.25


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Meanwhile just last month we2

announced the beginning of construction of a $303

million interim amusement park to be developed by4

an affiliate of an Italian-based company called5

Central Amusements International, the first 36

acres of which are set to open in Coney Island7

this summer.8

Finally we plan to break ground on9

a 120-unit affordable housing project including10

South Brooklyn's first YMCA this year. In Staten11

Island we announced in September 2009, a deal for12

a 7-acre development at the long dormant Home Port13

site which is to include 30,000 square feet of14

retail space, a new waterfront esplanade, and 80015

residential units aimed at retaining young Staten16

Island professionals. The project, in which a New17

Jersey developer, Iron State Development, is18

investing $150 million, is expected to generate19

more than 1,000 construction jobs and 15020

permanent jobs. We're now working on21

infrastructure design and relocating City agencies22

from the site and expect to break ground in 2011.23

Here in Manhattan, we're currently24

undertaking site preparation on the first phase of25


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the 1.7 million square foot East Harlem Media,2

Entertainment and Cultural Center. This3

development will eventually include 800 units of4

housing, 600 of which are to be affordable, as5

well as a hotel and new retail, office, open and6

cultural space. The project will create 1,5007

permanent jobs and 4,000 construction jobs. We8

hope to break ground on the first phase which9

includes nearly 50 unites of low income housing10

and 5,000 square feet of retail space in the11

coming weeks.12

Meanwhile in Queens at Willets13

Point, we have now reached agreements with owners14

of more than 70% of the project site. As you know15

the goal is for the project site to be developed16

to create 5,000 units of new housing, 35% of which17

will be affordable, as well as retail, office and18

open space, a convention center and a school. In19

October 2009 we started the offsite infrastructure20

design work and expect offsite infrastructure21

ground breaking to commence in 2011. We also22

expect to issue an RFP for a developer on the site23

this year, after receiving a robust response to an24

RFQ issued in October from 25 developer teams.25


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The City has also started the ULURP2

process for the Flushing Commons projects in3

Central Queens. This project which is expected to4

come before the Council in July will, if approved,5

create a 5.5 acre mixed used development that will6

result in new housing, new retail and new open7

space as well as job opportunities for the8

Downtown Flushing community.9

And we're not simply completing10

projects that we have already announced. We're11

also launching ambitious new projects. These12

include working with the co-op that operates the13

woefully antiquated produce market in the Hunts14

Point section of the Bronx to finalize renovation15

plans and also developing an alternative fueling16

facility for trucks making deliveries to the17

market.18

In addition to our own capital19

investments we're also using money made available20

through the Federal stimulus to advance projects21

across the 5 Boroughs. To date EDC has received22

approximately $114 million in stimulus funding for23

infrastructure and energy projects. We've also24

been busy allocating benefits from the stimulus25


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plan through 2 different tax-exempt bond programs2

both of which we believe to be unique in the3

nation and each of which has served as a model for4

other cities and states across the United States.5

For instance, in the first round of6

the Recovery Zone Facility Bond Program, which7

makes benefits of tax-exempt financing available8

to stalled commercial projects, we allocated $359

million in bonding capacity to 3 projects in10

Brooklyn and Queens. The second round involved11

the allocation of nearly $40 million in bonding12

capacity to 3 additional projects in the Bronx,13

Manhattan and Queens. We expect to make our final14

allocations under this program in the coming15

weeks.16

The Nimble Bond Program meanwhile17

offers tax-exempt financing to manufacturers,18

including for the first time companies that19

produce intangible products like software. In20

November 2009 the Board of the Capital Resource21

Corporation approved a $4.4 million issuance under22

the Nimble Program to Stellar Services, an IT23

developer for construction projects. This24

issuance which we believe to be the first anywhere25


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in the United States contemplated under this new2

authority will allow Stellar to expand its3

operations on Manhattan's West Side, increasing4

economic activity and employment in the City.5

At the same time that we address6

our City's 21 st Century infrastructure needs, we7

must also focus our attention on the fundamental8

way we as a City do business. This is because9

what made our economy tick in the past, what gave10

us our competitive advantage during much of the11

last century, relied upon a model whose best days12

have come and gone.13

We remain the world's financial14

capital, the world's fashion capital, the world's15

media capital and so on. But on every front our16

status is under siege. That is why over the past17

year we have launched an aggressive slate of18

programs aimed at diversifying the City's economy.19

First we want to attract emerging20

industries in which the City has competitive21

advantages but in which we have historically hit22

below our weight. These are industries like new23

media, green services and bioscience. In the24

latter industry for instance we have made25


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significant progress in addressing the lack of2

viable commercial lab space in the City. This3

summer our private development partners,4

Alexandria Real Estate Equities, expect to open5

the first 300,000 square foot phase of the6

Alexandria Center for Science and Technology at7

East River Science Park where we have already8

secured an anchor tenant, IM Clone that is9

expected to occupy a third of the building space.10

We're also moving towards--forward11

on what will eventually become a 500,000 square12

foot commercial lab complex at the Brooklyn Army13

Terminal. We expect to make an announcement on14

our progress on this important project in the15

coming weeks.16

In addition to attracting new17

businesses it is also incumbent upon us to help18

so-called legacy industries transition to 21 st 19

Century business models. Take our efforts in the20

industrial sector as an example. While it is true21

that this sector has been declining for a long22

time, a trend that is consistent with many major23

cities across the country, it still has a vital24

role to play in the City's economy and we believe25


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presents significant opportunities for us.2

This is underlined by the fact that3

between 2004 and 2007 the latest years for which4

this data is available the industrial sector in5

the City actually outperformed the rest of the6

country, growing by 0.6% versus a national decline7

of 0.5%. That is why we're making investments to8

expand this important sector.9

For example along the Sunset Park10

Waterfront at the South Brooklyn Marine Terminal,11

we're working on 2 projects totaling $120 million12

with Axis Groups and Sims Municipal Recycling that13

will bring this long dormant port facility back to14

life and result in the construction of a new15

break-bulk shipping facility and recycling plant.16

Together these projects will create 400 high17

paying jobs and eliminate 168,000 truck trips from18

the City's roads each year.19

The final way in which we are20

seeking to transform the City's economy is by21

working to foster entrepreneurship in the City22

generally regardless of industry. The more than23

50 initiatives underway include, for instance:24

incubator spaces, providing hundreds of low cost25


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work stations and business development services to2

startup companies; an angel investments fund that3

is expected to increase seed capital for City-4

based startups by as much as 2%; and international5

competitions aimed at spurring innovative ideas6

through the creating of new business plans and7

smart phone applications using long neglected8

government data.9

Of course we recognize that while10

we transform the City's economy, we must ensure11

that in doing so the benefits of this12

diversification are felt in all communities and by13

people of all backgrounds and creeds. This is why14

we are so focused on our efforts relating to15

minority and women owned business enterprises or16

MWBEs. We do this not just to comply with Local17

Law 129, the City's landmark MWBE mandate relating18

to subcontracts under $1 million on City-funded19

projects, but also because we believe that MWBEs20

provide new opportunities for the traditionally21

disadvantaged while spurring competition and22

reducing costs.23

To this end over just the past24

several months, we have hosted outreach efforts in25


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Jamaica, Hunts Point and Bedford Stuyvesant to2

introduce local contractors to the opportunities3

presented by EDC's many development projects. We4

are proud to report that nearly 300 firms attended5

these programs alone.6

In addition we are pleased to7

report that we continue to surpass our agency MWBE8

goals of 20% MWBE participation on applicable9

construction project's subcontracts and 22% MWBE10

participation on applicable professional services11

contracts. With actual year to date participation12

rates so far in this fiscal year of 23% and 31%13

respectively.14

But as well as we have performed in15

recent years we know that we can do better on this16

front. That's why we at EDC are currently17

exploring additional ways to enhance and expand18

our MWBE program. And I hope to have much more to19

report on our efforts in this front in the coming20

weeks.21

Though we know that we have a big22

task in front of us, we also know that we have no23

choice but to succeed. With the continued support24

of your Committee and the rest of the members of25


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the City Council we at EDC are confident that the2

City will, as it has repeatedly done throughout3

its history, make the tough decisions and wise4

investments that need to be made to ensure its5

success.6

In so doing I remain a firm7

believed that we will all, together, usher in a8

new era of prosperity for our City, a new era of9

innovation and a new era of greatness. I'm happy10

to take your questions.11

CHAIRPERSON REYNA: Thank you12

President Pinsky. I just wanted to commend your13

vibrant testimony of such progress at EDC.14

Certainly at a cost. I'm not happy to hear that15

there's a deficit but you're certainly addressing16

that as we move along.17

I want to just introduce the18

Committee members who are here today. I'd like to19

introduce Sara Gonzalez from Brooklyn; Brad Lander20

from Brooklyn; Margaret Chin from Manhattan; and21

Mark Weprin from Queens. I'd also like to just22

read into the record, since I'm chairing, take23

advantage, and before I do so, I'd like to thank24

the Committee's staff, both Economic Development25


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and Small Business Committee who have done a2

tremendous job in preparing for this particular3

hearing.4

Dear Mayor Bloomberg:5

We write this letter to tell you6

just how instrumental the Industrial Business Zone7

Program has been in helping businesses like ours,8

Lucky's Real Tomatoes, in providing resources to9

assist us in succeeding in today's challenging10

economic times. Lucky's Real Tomatoes moved to11

Brooklyn in 1985 where we purchased our warehouse12

and have employed hundreds of residents from our13

community over the course of the last 25 years.14

For the past several years the15

amazing staff at EWVIDCO in particular has16

assisted us in filing for Empire Zone benefits and17

has referred us to programs that have reduced18

costs and kept us lean which has enabled us to19

stay in New York, to save and provide jobs of so20

many in Brooklyn. They have become an essential21

partner in the many business challenges we have22

faced and have steered us to the various23

departments and agencies that have assisted us.24

Protecting and developing our25


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industrial sector is crucial and essential to the2

City's economic development as it constitutes3

nearly 15% of the City's workforce and it4

contributed $1.7 billion in tax revenues.5

I'm happy to have received this6

right before our hearing today. It was addressed7

to myself and others as Council Members and this8

particular business is located in my District, 299

Meserol Avenue. And I shared it with you because10

I wanted to just give you a highlight of how the11

IBZ's play and their service providers play such12

an integral role in the economic development of13

the City of New York. And I'm sure you know that.14

But if you can just share with us the future of15

the IBZ as it is being evaluated, whether to stay16

within the portfolio of the Department of Small17

Business Services versus coming into the portfolio18

of Economic Development Corporation.19

PRESIDENT PINSKY: Well as you know20

the Mayor's Office of Industrial Policy is21

located, now, in the Department of Small Business22

Services as you said and there's no specific plan23

to move it out of the Department of Small Business24

Services.25


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That being said we are actively2

engaged with our partners at the Department of3

Small Business Services as well as the Department4

of City Planning and also at the Mayor's Office in5

evaluating the City's policy with respect to6

manufacturing more broadly. And we're hoping that7

as a result of this interagency effort that we8

will be able to better streamline the services9

that we provide to manufacturing businesses, that10

we can make changes where those changes make11

sense, and that we can continue to offer the kinds12

of investments that we are currently offering.13

And we're making very significant investments in14

the manufacturing sector now.15

We, through the IDA in the last 816

years have helped nearly 150 businesses and17

encouraged investment of nearly $1 billion. We're18

making investments as I mentioned in Sunset Park19

as well as Red Hook. We're looking to expand the20

New York Container Terminal in Staten Island as21

well as the Hunts Point Produce Market in the22

Bronx. So we take this sector very, very23

seriously.24

The specific location of the25


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specific office that you were referring to, as I2

said, there's not current plan to move it. But we3

want to make sure that the services that we4

provide continue to serve this industry the way5

that it needs to be served. And I'd like, by the6

way, just to commend specifically the work of7

EWVIDCO which we've actually worked on a number of8

projects with. I think they do a phenomenal job9

and they and other providers like them are10

certainly worthy of support.11

CHAIRPERSON REYNA: And so, you12

know, I appreciate the comment on their behalf.13

And I wanted to just express to you the budget14

currently eliminates the service providers'15

contracts. How is your commitment going to16

continue if what we're proposing is17

counterintuitive?18

PRESIDENT PINSKY: Well as I19

mentioned, that is in this Department of Small20

Business Service's--21

CHAIRPERSON REYNA: [Interposing]22

Um-hum.23

PRESIDENT PINSKY: --budget so you24

would have to ask them specifically--25


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Um-hum.3

PRESIDENT PINSKY: --that question.4

What I can assure you though is that we continue5

to make very substantial investments in the6

manufacturing sector, hundreds of millions of7

dollars. And to the extent that we determine that8

there are additional services that are needed9

after the results of this interagency work is10

done, then we would certainly have to look at the11

budget and figure out how to define those12

resources.13

But again the specific cut that14

you're referring to is one that you'll have to ask15

the Department of Small Business Services about.16

CHAIRPERSON REYNA: And as far as17

your community block grant, development block18

grants, is there money identified in CDBG for19

service providers under your portfolio to be20

picked up, you know, so that it's a budget line21

dedicated for service providers through the EDC22

portfolio?23

PRESIDENT PINSKY: We don't have24

any money allocated out of CDBG for that. Our25


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CDBG funds are fully subscribed at the moment for2

a number of different economic development3

requirements.4

CHAIRPERSON REYNA: Can you mention5

some of those?6

MR. JASON WRIGHT: We do have CD7

earmarked in 2011 for the Graffiti Program.8

CHAIRPERSON REYNA: For the what9

program? I'm--10

MR. WRIGHT: [Interposing] the11

Graffiti Free NYC Program.12

CHAIRPERSON REYNA: But that's also13

being eliminated.14

MR. WRIGHT: That is not being--15


No?17

MR. WRIGHT: --eliminated.18

CHAIRPERSON REYNA: Okay. How much19

of the CDBG money goes into the Graffiti Program?20

MR. WRIGHT: Well at full capacity21

the program is just under $3 million.22

CHAIRPERSON REYNA: $3 million?23

MR. WRIGHT: $3 million.24

CHAIRPERSON REYNA: Um-hum.25


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MR. WRIGHT: And there was tax levy2

for the 2010 budget and the anticipation is that3

we'll be able to access CD funds next year as well4

as some transportation funds.5

CHAIRPERSON REYNA: And what is the6

total amount of CDBG money for EDC?7

MR. WRIGHT: It's just under $1.38

million.9

CHAIRPERSON REYNA: So the10

combination of a total of $3 million is in11

addition to the tax levy dollars?12

MR. WRIGHT: It's not--we had tax13

levy this year.14


MR. WRIGHT: But with no CD. Next16

year the budget is being funded through $1.317

million of CD.18


MR. WRIGHT: And the balance with20

Federal transportation funds.21

CHAIRPERSON REYNA: And there is no22

other CDBG money that would qualify for IBZ23

service providers to have a budget line under EDC.24

PRESIDENT PINSKY: None that we25


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have at our disposal.2

CHAIRPERSON REYNA: And has that3

been requested from the Federal government as4

perhaps a particularly contract that could qualify5

for CDBG money?6

PRESIDENT PINSKY: I don't--7


On behalf of EDC?9

PRESIDENT PINSKY: We have not10

applied for that. As I mentioned the office is in11

the Department of Small Business Services--12


Um-hum.14

PRESIDENT PINSKY: --they may have-15

-I don't believe that they have but you can ask16

them.17

CHAIRPERSON REYNA: Okay. I just18

want to make sure that I understand from EDC's19

point of view what have you attempted to do20

because Small Business Services currently21

eliminates their budget line to support the22

service providers and so I want to understand what23

attempts has EDC done in order to support perhaps24

finding ways to bring solution to the cut. And so25


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obviously CDBG money is not available. You have2

identified any available funding for the3

opportunity to bring in the portfolio of the 114

service providers, 11 correct?5

PRESIDENT PINSKY: That sounds6

right to me, I'm not positive.7

CHAIRPERSON REYNA: And it's8

important that we continue to see the service9

providers contracted, whether it's through SBS10

and/or EDC. I hope to continue to have these11

discussions with you, President Pinsky, because as12

you already mentioned in your testimony, the13

growth in the industry level and that is due to14

all the efforts and investments that we have made15

collectively to the growing economy of our16

industrial spaces and their parks.17

So I hope that we can figure ways18

in which we can be creating in requesting perhaps19

additional CDBG money where there's an opportunity20

to do so.21

PRESIDENT PINSKY: And we'll be22

happy to continue that conversation.23

CHAIRPERSON REYNA: Thank you. I'd24

like to recognize Julissa Ferreras from Queens.25


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And I wanted to just--I know that Sara Gonzalez2

was here and she has left you the question,3

fabulous, so Council Member Brad Lander, please.4

COUNCIL MEMBER LANDER: Madam5

Chairwoman, thank you. President Pinsky, I like6

the sounds of that. It's nice to see you today.7

So yes, let me start by being Council Member Sara8

Gonzalez. And on her behalf I would like to thank9

you for the upcoming Forum for Industrial10

Businesses in Sunset Park and to thank you Deputy11

Mayor Lieber and the staff at EDC, especially12

Ashley Cotton, Andrew Genn, Josh Nachowitz, for13

their attention and increased dialog about the14

issues important to Sunset Park and the 38 th 15

District. She left a long list of questions but I16

will focus in on--17

[Laughter]18

COUNCIL MEMBER LANDER: --Bush19

Terminal Park. I wonder if you could start by20

giving us an update on the progress there please.21

PRESIDENT PINSKY: Yes. We're22

currently performing remediation work at the park23

site. We expect that once the remediation work is24

completed that we'll be able to do a25


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groundbreaking. And we're hoping to begin the2

actual construction work following the completion3

of remediation sometime late this summer.4

So we are moving ahead with that5

project. We consider it to be a very important6

one for Sunset Park and for all the people of7

Western Brooklyn and we are committed to moving8

forward with it.9

COUNCIL MEMBER LANDER: Super. And10

now much is--is the funding for the construction,11

how much of that funding is in place?12

PRESIDENT PINSKY: There is $3213

million in place. The issue with the park is that14

the remediation has turned out to be more15

expensive than had been anticipated. And so we're16

building now in a phased basis so the entire park17

will be remediated, the entire park will be built18

out, though parts of the active recreation19

facilities that were originally planned will, at20

least initially, be passive recreation facilities.21

And as we find more resources in the budget we22

will look forward to building out the later23

phases.24

COUNCIL MEMBER LANDER: Just25


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because I have to report back to her, can you--so2

I mean how much is the remediation costing?3

What's left for phase one for this passive4

recreation and how much will be needed to get the5

active recreation in phase two?6

PRESIDENT PINSKY: The remediation7

is about $22 million and that's split between8

State and City funds. And the remaining roughly9

$10 million, again, is split. There's a City10

contribution, a State contribution and a Federal11

contribution. And we think that what we won't be12

able to build in the first phase will be a couple13

of ball fields. But we think it's going to be a14

fabulous resource nonetheless and we're certainly15

going to work with the Council to see if we can16

identify additional sources.17

COUNCIL MEMBER LANDER: And so just18

the phase one passive recreation will be what?19

PRESIDENT PINSKY: It will be20

fields, trails and other landscaping elements like21

that.22

COUNCIL MEMBER LANDER: Okay. And23

do you have some rough estimate of how much would24

be needed for the ball fields in phase two?25


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PRESIDENT PINSKY: It's probably a2

few million dollars.3

COUNCIL MEMBER LANDER: Okay. I'm4

sure the Councilman's appreciate but also would5

love to know, as you guys have a more precise--6

PRESIDENT PINSKY: [Interposing]7

Yeah and we're happy obviously to speak with her8

at greater length--9

COUNCIL MEMBER LANDER:10

[Interposing] Super.11

PRESIDENT PINSKY: --whenever she's12

free.13

COUNCIL MEMBER LANDER: Thank you.14

Madam Chairwoman, can I resume the role of Council15

Member Lander?16

CHAIRPERSON REYNA: Of course.17

Council Member Lander. Thank you Council Member18

Gonzalez.19

[Chuckling]20

COUNCIL MEMBER LANDER: So I first21

want to echo what the Chair said about the22

importance of support for our manufacturing23

services. I want to give you credit for the24

increased attention that EDC is giving to25


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manufacturing and industrial businesses. I see2

it. It's to your credit. I think the work you've3

done through Nimble and having EDC's attention on4

manufacturing more than has always been in the5

past is to your credit. But I do want to echo6

what Chair Reyna said that even though SBS7

obviously is directly responsible for the service8

provider contracts, those really are essential.9

I share your point of view that10

EWVIDCO and South Brooklyn and other providers11

have done a great job and thing we need to keep12

them doing it. So I'd be glad to ask the13

Department of Small Business Services that14

question but I'm distressed to hear that they15

might be zeroed out and would love your help as a16

supporter of manufacturing to help preserve those17

important services.18

A few, so I have a couple of19

questions about specific projects and then want to20

ask about how we can do even more to link our21

economic development strategy and our job22

creation, job placement, workforce development23

strategy.24

On specific projects, let me see.25


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41

I will start, well let me start with one, with2

Javits, I guess. I see that Javits it still in3

the budget. It's my understanding that's largely4

a placeholder and that, you know, negotiations are5

taking place both around Governor's Island and6

around Brooklyn Bridge Park. And that maybe when7

you come to us with an Executive Budget we'll have8

a clearer idea about what that money is for and9

how it's being used. Is that?10

PRESIDENT PINSKY: Yeah I hope to11

be able to report in much more specificity then.12

There are ongoing discussions on that topic.13

COUNCIL MEMBER LANDER: So I have14

expressed to a number of members of the15

Administration my concern about Brooklyn Bridge16

Park in particular where I only know--well I guess17

I know a little more than what I read in the18

papers now because the MOUs that are being signed19

between the Mayor and Senator Squadron and20

Assemblywoman Millman on the one hand and the MOU21

with the term sheet between the Mayor and the22

Governor are now, you know, are public.23

It's concerning to me that what24

seems to be contemplated is that an allocation of25


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City capital, you know, which the Council will2

have to vote on for a park in which for the first3

time unlike parks at the Parks Department, the4

Council has a severely constrained legislative5

oversight and administrative role. There's not6

enough details to ask you any questions today but7

I just want to let you know that if you come to us8

asking us to put money into that park which I hope9

will be a great park, I will have a lot of10

questions about the structure which troubles me.11

PRESIDENT PINSKY: And I'm sure12

that at that time we'll be more than happy to13

answer those questions.14

COUNCIL MEMBER LANDER: Great.15

Thank you. A small thing, the BQE Mitigation16

Study is referred to in the budget. That's a17

Federal grant that I think Congresswoman18

Velasquez, just for the stretch of it that kind of19

has the cut-through--20


That's correct.22

COUNCIL MEMBER LANDER: --Carol23

Gardens. Is that all Federal money? Is there a24

local match? Are we providing anything for--?25


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PRESIDENT PINSKY: [Interposing] I2

believe that--and I'll have to get back to you to3

confirm this, I believe it's all Federal. And4

we're undertaking a study using those Federal5

funds to see if there are ways that the damage6

that that cut has done to the surrounding7

communities can be mitigated in one way or8

another.9

COUNCIL MEMBER LANDER: Okay that'd10

be great. I mean obviously--11


I'll - - on that.13

COUNCIL MEMBER LANDER: -if it's14

all Federal money then, you know, our role is more15

limited but I would love to know if there's any16

City money.17

PRESIDENT PINSKY: I have just18

confirmed that it is all Federal.19

COUNCIL MEMBER LANDER: Okay.20

That's great. I mean the Congresswoman is working21

on it. I appreciate your being the grant conduit22

and we look forward to working with a contractor23

on it.24

PRESIDENT PINSKY: Great.25


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COUNCIL MEMBER LANDER: The2

Downtown Brooklyn Partnership, are we, I know in3

the past the City has provided resources to them,4

and I'd love to know the status on that. Are we5

continuing to do that? How much? Obviously the6

real estate climate has changed pretty7

substantially. What's the current story or the8

current plan?9

PRESIDENT PINSKY: Well we think10

that the Downtown Brooklyn Partnership plays a11

very important role in the development of not just12

Downtown Brooklyn but also the BAM Cultural13

District and the surrounding communities. And so14

the Administration has supported the Partnership15

in the past.16

I know that there are ongoing17

discussions between City Hall and the Partnership18

about the nature of that support going forward but19

my assumption is that we will continue to support20

them on, you know, something roughly equivalent to21

what we've done in the past, maybe less, but that22

there will be some ongoing support that will be23

provided. And when I have a little more24

information I can certainly share that with you.25


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COUNCIL MEMBER LANDER: Do you know2

what was--I mean I should know what was in the3

budget last year and what if anything is in the4

Preliminary Budget but I don't know--5

PRESIDENT PINSKY: [Interposing] It6

was $500,000 a year. My guess is that the number7

will probably be lower just because of budgetary8

pressures that we're all facing. But there will9

be I think some sort of ongoing support. And10

whether that will be City tax levy money or EDC11

funds that we'll have to work out.12

COUNCIL MEMBER LANDER: Okay.13

Thank you. And then certainly on the project14

question front, last but definitely not least, and15

I hope we'll be able to have a hearing on Atlantic16

Yards now that, you know, there's been a17

groundbreaking and the project is moving forward.18

There's a lot of questions that the19

Council would like to ask. So I'm hopeful that we20

can do an Economic Development Committee hearing21

just on that project. But just strictly from a22

budget point of view, can you tell me what's the23

status of the money that the City has allocated24

for acquisition, infrastructure?25


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PRESIDENT PINSKY: The original2

investment that had been agreed upon when the3

project was first envisioned was $205 million. It4

was $100 million that could be used for land or5

infrastructure and I think the agreement early on6

was that it would be used entirely for land. And7

then $105 million in the City's capital budget for8

City capital projects relating to the Atlantic9

Yards Project.10

As a result of the negotiations11

that took place since that project was originally12

envisioned, as well as changed financial13

situations, we restructured the City's14

contribution. But the bottom line is that we15

ended up with a smaller contribution to the16

project in the amount of $179 million.17

And that consists of the original18

$100 million for land, plus another $31 million19

that was allocated to land, $24 million to20

infrastructure that the City was previously going21

to do but now Forest City will do on behalf of the22

City and that money will go in as Forest City23

actually performs that work. And then another $2424

million remaining in the City's capital budget for25


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its own infrastructure work relating to the2

project.3

COUNCIL MEMBER LANDER: So a4

decreased overall commitment but an increased5

allocation of resources to Forest City for both6

acquisition and some infrastructure--7


That's correct.9

COUNCIL MEMBER LANDER: --that had10

been envisioned--11


That's correct. And all of these investments are13

tied to requirements on Forest City to perform in14

various ways on the project.15

COUNCIL MEMBER LANDER: Okay. I16

have here, you won't be surprised, I have a lot17

more Atlantic Yards questions but I'm going to18

save them in the hopes that we can do an Atlantic19

Yards hearing now that the project is rolling20

forward. So I won't ask those now.21

PRESIDENT PINSKY: And again we're22

more than happy to participate.23

COUNCIL MEMBER LANDER: Thank you24

very much. I'm happy to wait for a second round25


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to ask some of my questions about linking jobs and2

economic development. Okay.3

CHAIRPERSON REYNA: I appreciate4

that Council Member Lander. I did have a question5

myself concerning jobs. And it was in relation to6

your testimony President Pinsky because you had7

mentioned in your testimony wherever there was an8

opportunity to mention certain amount of9

construction jobs or permanent jobs. And it10

totaled 5,000 construction jobs and 1,65011

permanent jobs but there were few projects that12

you mentioned without any figures as far as13

whether it was construction jobs versus permanent14

jobs.15

So in particular I wanted to16

understand amongst the thousands of jobs that are17

the potential of all the projects you mentioned18

and the ones that already have begun, what19

correlation has there been with the Workforce20

Centers or any service providers in the employment21

training and job placement industry where there's22

collaboration between your agency and SBS?23

PRESIDENT PINSKY: The answer is24

there's been a significant amount of workforce25


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training that's been connected to our projects.2

And I would say that that has been increasing--3


Um-hum.5

PRESIDENT PINSKY: --over the last6

several years and I think as much as anything7

else, the thanks for that is owed to the Council8

which has made very clear as we've gone through9

the ULURP process the importance of this linkage.10


PRESIDENT PINSKY: And so, you12

know, with each project we hone the model and we13

make it, I think, more effective. I think a good14

example of where it's worked very well so far has15

been in Willets Point where we have had hundreds16

of workers in the Willets Point community who have17

gone through our training programs both with18

LaGuardia Community College as well as with the19

Greater New York Auto Dealers where individuals20

have not only gotten professional skills but many21

of these people who are not proficient in English22

have learned to speak English, have been given23

very important business and interviewing skills.24

And that's a model that I think we25


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would like to replicate in other areas. Similarly2

we're working on a number of workforce related3

programs in Coney Island, for example when the4

circus came to town last year, a very large5

percentage of the workers that they hired were6

people from the immediate community. And in all7

of these cases we're also working in addition to8

working with private companies and private9

organizations, we're also working with SBS. We10

work hand in glove with them.11

CHAIRPERSON REYNA: And who is the12

person to coordinate from your office with SBS for13

identifying actual jobs and placement?14

PRESIDENT PINSKY: Well it really--15

it would be the project manager on each project.16

What we're working on now actually--17


Um-hum.19

PRESIDENT PINSKY: --and we don't20

have completed yet--21


Um-hum.23

PRESIDENT PINSKY: --but I'm hoping24

we'll get this completed shortly is trying to25


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regularize this process. Because the way we've2

tended to do it has been on an ad hoc basis. And3

I think it's been successful. But, you know,4

we'll develop a project, we'll talk to the5

community, the community will make it clear to us6

and we'll believe as well that it's important that7

we ensure that the benefits of that project were8

down not just to the City generally but to the9

community specifically.10

And we'll come up with a program11

that addresses that. But I think what will be12

more effective going forward is if we create a13

suite of programs that we always attach to our14

projects. And that's what we're working on right15

now. And we'll have, I think, more to talk about16

on that front in the next couple of months. I had17

a briefing on where we were about two or three18

weeks ago. And there's still some work left do to19

but I think we're coming to a pretty good proposal20

that we'll bring forward.21

CHAIRPERSON REYNA: I look forward22

to reviewing that proposal and I hope that it will23

include an Excel database of, you know, job24

postings and necessary requirements, what type of25


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training would be required for job placements so2

that under your portfolio of projects out there so3

that we can measure, have a metric system of4

actual placements and actual jobs related to those5

placements.6

And, you know, I know that Council7

Member Lander will perhaps ask further questions8

concerning that area but it is of interest to this9

Council to see more collaboration so that we're10

dealing with statistics. And I just wanted to11

share some of these statistics with you from North12

Brooklyn in particular.13

40% of North Brooklyn residents14

work in industrial jobs. 15% local residents walk15

to work. 36% local residents live at or below the16

poverty line. And 20% local residents do not17

speak English. 30% foreign born. And so these18

are statistics that we can deal with if we are19

actually understanding how is the City providing20

in the local economy, jobs--21


And--23

CHAIRPERSON REYNA: --to deal with24

unemployment.25


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PRESIDENT PINSKY: And I think2

those are very important statistics. And they3

show that, you know, we all still have a lot of4

work to do.5


PRESIDENT PINSKY: And it's very7

important that we make sure that the benefits of8

all the economic development that's taking place9

are spread across the broader City.10


PRESIDENT PINSKY: I think the City12

has done a phenomenal job of increasing its job13

training programs. And I think the Department of14

Small Business Services deserves a lot of credit15

for that. You know, we have done, I think, a good16

job linking our projects with their programs but17

we always can do better and we are more than happy18

to get good ideas from the Council on this front.19

CHAIRPERSON REYNA: Thank you very20

much. I just wanted to welcome Council Member21

Albert Vann who has joined us from Brooklyn. And22

I'd like to go to our next Council Member Margaret23

Chin who has a question.24

COUNCIL MEMBER CHIN: Thank you25


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Chairwoman. President Pinsky, welcome, and I look2

forward to meeting with you later on. I have a3

couple of questions about projects in Lower4

Manhattan in my District. And I'm concerned5

whether the cuts proposed by the Mayor on the6

capital plan will have any affect on these7

projects.8

The first one is the Governor's9

Island redevelopment and the second one is the10

East River Waterfront.11

PRESIDENT PINSKY: The Governor's12

Island redevelopment, as I mentioned to Councilman13

Lander, is the subject right now of ongoing14

negotiations with the State. I think that if15

those negotiations are successful, there will16

likely be a specific commitment that's made to the17

State by the City in which case I would imagine18

that the cuts would not impact that project but it19

will be hard to say that for certain until those20

negotiations are completed.21

With respect to East River22

Waterfront, the East River Esplanade project, I23

believe, again, that that project is primarily24

Federal money. And therefore it would not be25


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subject to City budget cuts.2

COUNCIL MEMBER CHIN: Okay. The3

other issue is I know our Speaker Quinn mentioned4

about regional markets at the Fulton Street5

Market. So that's one of the projects that we're6

looking at. And so in Lower Manhattan where we7

have tested it out during the summers and during8

holiday season and that is a project that I wanted9

to see what's your view on that. Will EDC help us10

work on bringing that regional market to the old11

Fulton Fish Market at the Seaport?12

PRESIDENT PINSKY: Well we13

definitely agree that a public market is a good14

use for the South Street Seaport. And it's15

something that had been included in GGP's earlier16

proposal for redeveloping the Seaport. As I'm17

sure you very well know, the situation with GGP is18

a little bit up in the air right now. They've19

been in bankruptcy for a number of months. It20

looks like they're going to be emerging from21

bankruptcy and they have indicated to us that they22

remain committed to the redevelopment of South23

Street Seaport which I think is good news.24

But until they come out of25


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bankruptcy, since they actually control the2

buildings that we're discussing, it's going to be3

a little bit difficult for us to reach that goal.4

But we are certainly more than happy to work with5

you to try to figure out working with GGP as well,6

how we can bring a market to the South Street7

Seaport area.8

COUNCIL MEMBER CHIN: Okay. Thank9

you.10


Council Member Chin. Council Member Mark Weprin.12

COUNCIL MEMBER WEPRIN: I was going13

to have Brad Lander do my questions but he left14

the room.15

[Chuckling]16

COUNCIL MEMBER WEPRIN: Thank you17

Madam Chair. President Pinsky, thank you for18

being here. I had some questions about Willets19

Point and I know Council Member Ferreras is here20

and I'm sure she may have interest in that topic21

as well as well as Council Member Koo is. Well22

it's all of us in Queens. You mentioned the23

status just briefly that you have 70% of the land.24

Could you elaborate specifically on what's25


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happening with those negotiations?2

PRESIDENT PINSKY: Yeah. We are in3

active negotiations with a number of the land4

owners whose land we don't currently have5

agreement with. And as you mentioned, that's6

about 30% of the land in Willets Point. You know,7

some of them obviously are more interested in8

selling than others. We've continued to make9

deals with the land owners and we would ideally10

like to reach consensual agreements with everyone.11

And that certainly would be our strong preference.12

There are though a few land owners who are less13

interested in selling and we'll have to see how14

those dynamics play out.15

In many cases with respect to our16

acquisitions we've actually reached deals that I17

think land owners were very happy with. Thanks to18

the support of the Council we were able to move a19

number of very large businesses in Willets Point20

to College Point where they not only will be able21

to continue their business but many of them plan22

to expand which I think is good news for everyone.23

And we would love to strike more24

deals like that with other land owners.25


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COUNCIL MEMBER WEPRIN: The 70%2

that you have deals with, are they in a specific3

area of Willets Point or are they spread around?4

PRESIDENT PINSKY: They're spread5

around. Although they've tended to be focused in6

the southwest corner closer to the subway. And7

that's consistent with what our plans for8

development are. As you know the original plan9

had been that we were going to go out and RFP the10

entire development to a single development team.11

And what we've concluded is that12

with the change in the economy and the difficulty13

in financing very large acquisitions that what14

probably makes more economic sense both for the15

developers and for the City is to have a rolling16

development where we would start in the southwest17

which we think is the logical place for18

development to start and over time develop all of19

it without, you know, in any way ceasing20

development during the process and still intending21

to develop the whole project site in the timeframe22

that we originally proposed.23

COUNCIL MEMBER WEPRIN: The Queens24

Chamber of Commerce had raised concerns about25


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doing piecemeal development to me out of fear; a2

lot of the sites that are already sold are along3

126 th Street? A lot of them are over there.4

There's a fear that, you know,5

because that is such a focal point of Citi Field6

that there may be a desire to sort of clean that7

up but then not worry about the rest of the8

project and to forget about the global plan that9

you've talked about including housing, including10

the convention center, including other projects as11

well, commercial space in there. You know,12

that's, you know, everyone gets paranoid in times13

like this. And they just want to make sure that14

this isn't--that the big picture is still clear.15

PRESIDENT PINSKY: Absolutely. No.16

We fully intend to develop the whole site. You17

know, when we were advocating, when the18

Administration was advocating for the rezoning of19

Willets Point, what was made clear was that in20

addition to wanting to develop the area, in21

addition to wanting to create jobs, one of our22

prime motivations was to clean up the environment.23

And if you only develop along 126 th 24

Street you haven't succeeded in cleaning up the25


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majority of the environmental damage that that2

site is causing to the Flushing River and the3

surrounding communities. So we remain 100%4

committed to the full development. It's going to5

start in the southwest but it will continue on a6

continuous and ongoing basis throughout the entire7

development area.8

COUNCIL MEMBER WEPRIN: I'll wrap9

up in a minute. So when do we feel, if you're10

going to take, I won't call them the low-hanging11

fruit, but start with the ones you already have12

under control, when is that going to start? Is13

infrastructure money there to start doing14

infrastructure problems that are there?15

PRESIDENT PINSKY: We have selected16

the developer, the construction manager for the17

infrastructure, the offsite infrastructure that18

the City is going to be primarily responsible for.19

There's, I believe, $150 million package that20

we've signed with the construction manager and21

design work is underway there. And we're22

expecting to break ground in 2011.23

The work on the onsite cleanup and24

infrastructure will progress with the development.25


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We issued an RFQ. We got 29 responses; developers2

are very enthusiastic to start this project. And3

the timing specifically of the RFP which will be4

necessary before we can actually begin development5

on the site will depend a little bit on the market6

but our hope is that it will be some time later7

this year perhaps that we can go out to the8

development community so that we can have then the9

onsite work starting roughly in parallel with the10

offsite.11

COUNCIL MEMBER WEPRIN: Thank you.12

Well as I mentioned, this is an issue of great13

concern to people throughout Queens, especially14

those who live very close to this site but also,15

you know, in Districts that are nearby. Obviously16

when Citi Field is open, the eyesore of Willets17

Point becomes very obvious across the street18

there. And I know a lot of people expressed--were19

very concerned that, you know, we get moving as20

fast as possible and I'd be happy to help anyway I21

can in trying to move that along.22

PRESIDENT PINSKY: I appreciate23

that. Thank you.24

COUNCIL MEMBER WEPRIN: Thank you.25


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Council Member Weprin. And Council Member Julissa3

Ferreras is next followed by Albert Vann.4

COUNCIL MEMBER FERRERAS: Good5

afternoon President. So clearly I represent6

Willets Point. And it's probably the topic of7

conversation at every community event that I8

attend from civic associations to church meetings9

and their biggest question is when will there be a10

groundbreaking. And I understand the process.11

And I tried to explain it. But before we talk12

about groundbreaking there's some issues that we13

still have to address. And my question is on the14

relocation. We had some monies put in for15

relocation, oh this doesn't work? [Off mic].16

Okay. We'll move over.17

PRESIDENT PINSKY: Now you're18

Council Member Lander.19

COUNCIL MEMBER FERRERAS: I'm20

relocating.21

[Chuckling]22

COUNCIL MEMBER FERRERAS: So if we23

could talk about the relocation packages and24

what's happening with the tenants over at Willets25


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Point. And it's kind of a two-part. I know that2

you've purchased a large part of, you know, 70%.3

There is kind of a confusion between the4

transition from landlord to HPD and in some cases5

back to the landlord. Can you speak to that?6

PRESIDENT PINSKY: There are a7

couple of different types of parcels at Willets8

Point. There are parcels that are owned by one9

party and occupied by the same party. And then10

there are parcels that are owned by one party and11

occupied by someone else. So you have an absentee12

landlord who leases the space to a company. In13

the case of many of the owner-occupied parcels,14

when we've reached a deal with those businesses,15

we've agreed on a period of time during which they16

will remain at the site. And then they've agreed17

that they would like to begin the transition18

process. And that's what was described in College19

Point by way of example.20

With respect to the parcels that21

are owned by one party but occupied by another,22

the way that we've approached those is that we've23

taken title, the City has taken title, to the24

property and then steps into shoes of the25


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landlord. And we have not asked any tenants to2

leave the land. And we have pledged to all of the3

tenants that we will give them very sufficient4

advance notice to allow them to make the5

adjustment. We're working with a relocation6

specialist to help them with that adjustment.7

But we have not asked any tenants8

to leave. We've simply continued to charge them9

the rent that they were paying before. Now in a10

few cases, some of these tenants have chosen not11

to pay their rent. In those cases HPD which is12

managing the properties has sent them notice as13

any landlord would, saying you owe rent and at a14

certain point if you don't pay rent, you can't15

stay. But those are the only instances where we16

have even contemplated changing the tenancy at17

these parcels at this point.18

COUNCIL MEMBER FERRERAS: Okay. My19

other question is when it comes to the relocation;20

I know we had had several meetings that were very,21

I think, very positive in my office. And in those22

meetings we had Cornerstone sit in. And what was23

explained was that in the early part of the new24

year we were going to start having these25


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conversations about relocation, where they're2

going to be relocating to, what the options are.3

Do we have a start date or what we're looking like4

at this point?5

PRESIDENT PINSKY: Well we think6

that it doesnt make sense to, let me take a step7

back, Cornerstone has had discussions with all of8

these businesses and is beginning to get a sense9

as to what their needs are and is starting the10

process on their side. We don't think that it11

makes sense to have really active discussions with12

the businesses until we're closer to the time when13

they actually will need to leave. It, you know,14

most of these businesses, I think, would like to15

stay where they are for as long as possible.16

So Cornerstone's timing is17

partially driven by the timing of the actual18

development which comes to your question of the19

groundbreaking. To get to the groundbreaking we20

need to finish our offsite infrastructure design21

work and we also need to select a developer for22

the first parcel. And to get to the selection of23

the developer we need to do the RFP. And the RFP,24

as I mentioned, is going to be partially driven by25


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the market. We think at this exact time it2

probably doesn't make sense to go out to the3

market because we don't think we'll get the best4

response.5

But with the market continuing to6

improve, we're hoping we can start that process7

which will be a multi-step process some time in8

later part of this year maybe early next year but9

our hope would be the later part of this year.10

COUNCIL MEMBER FERRERAS: I was11

looking here where it says the approximate funds12

that you would need for 2010 at $194.5 million.13

And I guess that's a chunk from the $381.7 million14

is that correct?15

PRESIDENT PINSKY: Correct.16

COUNCIL MEMBER FERRERAS: So the17

$381.7 million is that majority of the money for18

acquisition?19

PRESIDENT PINSKY: It's a20

combination of acquisition and infrastructure.21

And what we tried to do is make conservative22

assumptions about what we would need for23

acquisition. You obviously, you never know what24

you're going to need until you're done with the25


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negotiations 'cause it's not entirely within our2

control. But we've made what we think is a3

conservative assumption. So far we're on budget.4

There will be a large portion of that that will be5

needed for the infrastructure work and that we're6

reserving for the infrastructure work.7

COUNCIL MEMBER FERRERAS: Okay.8

And I just have two other questions. I know that9

you made reference to the training program over10

with LaGuardia Community College. And although I11

think in theory it's really a good idea, I want to12

know what has really been the success rate. How13

many people have we transitioned out of Willets14

Point into real jobs?15

Because the other issue that we16

have which we came across later was immigration17

status. So we can take them there. We'll have an18

intake. You meet a number of quotas and you can19

say okay we have 200 people. But of those 20020

people if we're only placing 5, yet the project21

has $3 million or $1 million, how are we22

evaluating the success of this program?23

PRESIDENT PINSKY: Well again many24

of these businesses have not actually moved or25


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gone out of business. So in most cases the people2

are going through the training program are staying3

in their current jobs which is good as far as I'm4

concerned. Eventually when relocation occurs that5

will be when we'll be able to measure whether6

individuals got new jobs or not. I think that7

it's a very valid request and it's one that I'll8

have to talk to the team about how we can do the9

measurements.10

The measurements that we have so11

far are participants. And that number is in the12

hundreds. And I think the participants have been13

very pleased. We're offering these services14

regardless of immigration status as you know. And15

we're in fact assisting people with their16

immigration status in some cases.17

But I won't be able to give you a18

really good answer to your question until we're a19

little farther along in the process. But I hear20

your request for providing the data and we'll have21

to figure out what we can measure and how we can22

measure it.23

COUNCIL MEMBER FERRERAS: Thank24

you. I'm looking forward to a really good answer.25


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And then in this, as we allot this2

time, so it's 2010 and it seems that it goes3

through 2019. At what time or at what process, in4

this--well, at what time during this entire5

process do we see that we can have more6

involvement with the MWBE?7

PRESIDENT PINSKY: That will really8

start with the construction itself. Now we're9

using City capital money for the offsite10

infrastructure. And so we'll be subject to all of11

the standard MWBE goals. And as I mentioned in my12

introduction, EDC has a very good record of13

achieving those and we would plan on achieving14

them in Willets Point as well.15

There will also then be a developer16

who's selected and when we select the developer,17

we'll have a better sense from them and certainly18

one of

EDC Preliminary Budget Hearing March18, 2010

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