City Limits Magazine, January 1991 Issue

January 1991 New York's Community Affairs News Magazine $2.
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City Lilftits
Volume XVI Number 1
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2/JANUARY 1991/CITY UMITS
Bring Back the Public
O
ver the past 25 years, quasi-government agencies known as public
authorities have become important forces in the city's political
landscape. From just a handful of public authorities like the Port
Authority of New York and New Jersey (which is examined in this
issue) and the Triborough Bridge and Tunnel Authority, the number has
grown to some 30 such agencies.
Public authorities operate our trains, sponsor huge development
projects, build schools, provide financing for housing, among other
activities. And they do much of it with their own money, raised through
the sale of bonds.
This sounds fairly benign, until one realizes that public authorities
carryon their activities with little public oversight or legislative review.
That's why public authorities have become increasingly popular with
mayors and governors, who can use these agencies to push forward
controversial initiatives without the administrative or financial ac-
countability required of typical government departments. (Some public
authorities have become virtual fiefdoms, beyond the control of even the
executive branch. Felix Rohatyn's Municipal Assistance Corporation,
which sparred frequently with Mayor Ed Koch, is a recent example.)
Activists and legislators have viewed public authorities with growing
suspicion. But now a new trend is developing that may well make public
authorities even more inaccessible: they're taking on projects in consort.
The Hunters Point development in Queens is the work of three such
agencies, the Port Authority, the Urban Development Corporation (UDC)
and the Public Development Corporation (PDC). (PDC is technically not
a public authority but is a quasi-government entity with similar powers.)
Likewise, the redevelopment of piers 1 to 5 in Brooklyn Heights is being
undertaken by these three entities. The 42nd Street Project is the handi-
work of a subsidiary of UDC and PDC.
Such combinations of semi-public agencies may well get more com-
mon as the city's and state's financial positions worsen. Legislators,
activists and other government watchers should be wary. It's time to
reemphasize the idea of the public in public authorities.
* * *
There's really only one way to describe the Daily News' use of the
homeless to help break the newspaper's strike: repugnant. By enlisting
the homeless as hawkers, the newspaper's management has found a way
of getting the scab-produced paper on the streets at relatively little cost.
It's hard to blame the homeless for accepting the work. For those tossed
to the bottom of society's heap, any shot at making a day's wage seems too
good to turn down. Solidarity with the strikers is far easier for those with
a full belly and a home.
But there is simply no excuse for the Daily News' cynical ploy.
Whether the strike is settled or the paper folds the homeless hawkers will
undoubtedly be cast off, the few bucks they earned just a memory. James
Hoge should be ashamed.
* * *
City Limits has lost another member of its board of directors to public
office. Richard Rivera was resoundingly-and deservedly-elected as a
Civil Court judge from Brooklyn. Our loss is the judiciary's gain. 0
FEATURE
For Whom Does the Port Authority Toll? 12
Few New Yorkers know much about this multi-billion
dollar agency. It's time they did.
DEPARlMENlS
Editorial
Bring Back the Public .... ....... .............. ..... ..... .... ...... . 2
Briefs
Homeless Again? ........ ... ..... ... ......... .............. ....... ..... 4
ATURA Renewal .................. ....................... ............. 4
AIDS Housing Money .... .......... ......... ................. ...... 5
Profile
Shining Star .... ..... ..... .... ..... ....... ....... ............... ... .. .... 6
Pipeline
Return Offenders ........................... ...... ..... ........ ..... ... 8
Commons Concerns ........ ... ..... ..... ...... ... ....... ... ....... 18
City View
For Nonprofits, Less Money
Means More Organizing ... .. ... .......... ............... ... .. .. 20
Review
Of Homes and Cadillacs ............ ............. ............... 21
Shining Star/Page 6
Return/Page 8
Port Authority/Page 12
CITY UMITS/JANUARY 1991/3
HOMELESS AGAIN?
When Barbara Young and
Joan Jacobs and their 16
children and grandchildren
moved out of the shelter system
and into a two-family Queens
home in 1988, they thought
their troubles were over. But
now they're on the brink of a
return to homelessness.
Queens landlord Marcus
Habeeb received $43,000 from
the city's Emergency Assistance
Rehousing Program (EARP) for
agreeing to rent the house to the
families for 32 months at 106-
26 156th Street in Jamaica. He
received half the payment when
the families first moved in and
the final installment in Septem-
ber, 1989. Unbeknownst to the
city, Habeeb had stopped
making mortgage payments and
foreclosure proceedings started
on the building in August,
federal Section 8 housing
subsidies with the money given
to landlords, and the amount is
usually enough to encourage
landlords to keep housing
families once the 32-month
agreement is completed.
However, an earlier version of
the program that didn't include
the Section 8 tie-in led many
landlords to try and get rid of
families after the 32 months
were over. "We continue to see
clients at imminent risk of re-
entering the shelter system,"
says Steve Banks, the supervis-
ing attorney for the legal Aid
Society's Homeless Family
Rights Project. Banks says that
there are "at least several
hundred families" still at risk of
eviction because their landlords
are operating within the original
version of EARP.
1988. Habee6 has skipped
town, the property has changed
hands and the two families are
now fighting eviction.
"It's appalling," says
Randolph Petsche, an attorney
from Queens legal Services
who is representing the families.
"It is not a matter of pointing a
finger at anyone individual in
the city, but there must be some
way of safeguarding against
this."
At 1 06-26 156th Street, the
problems appear to stretch be-
yond the former landlord and
city policies. The current pro-
perty owner, Hertzl Moezinia of
.......... . __ the Five Boro Development
Corporation, purchased the
building from the First National
Mortgage Company in Garden
City, wnich foreclosed on the
home when Habeeb stopped
making mortgage payments.
First National is being sued for
fraud in connection to a number
of its properties by the Federal
Home loon Mortgage Corp?ra-
tion (Freddie Mac). A Freddie
Mac spokesperson refused to
provide any additional details.
D M.-yKeef.
Michael Handy, the director
of the EARP program, which is
run by the city's Human
Resources Administration, says
that his office will try to find
BIc:k to Sq ..... One?: Joan Jacobs is facing a possible return to
homelessness.
apartments for the women but
cannot .9uarantee that they will
not be forced to return to the
shelter system. He adds that city
did check some financial
records before giving EARP
money but had no way of
knowing about Habeeb's
mortgage problems. And he
notes that the city's law
department is now trying to
track down Habeeb and hold
him accountable.
This is not the first time that
homeless families receiving
housing through the EARP
program have faced the threat
of a return to the shelter system.
Under the current version of the
program, the city includes
In 1000.
13
12
11
10
NYC Homeless Family Count
(In Shelter System)
11,976 11,842 *

7

4

2
1
o
o November 30, 1989
NoenIber 30, 1990
5,063
* Includes adults in special residences
T_
CIoIIII ...
T_
.........
Soun;e: NYC Human Resoun;es Administration
ATURA RENEWAL?
The controversial
Terminal Urban Renewal Area
project in Brooklyn may be
having financing difficulties that
could force the project back to
the drawing bOOrd, according
to attorneys and community
leaders challenging the project.
Rose Associates, who was
named developer of the city-
sponsored project in 1987, is
seeking to find equity partners
for the project or pull out of it all
together, according to several
sources. And this month there
will be a hearing on a lawsuit
that seeks to block a $10.8
million federal Urban Develop-
ment Action Grant (UDAG) to
,
.
the project.
The $530 million project,
adjacent to the Long Island
Railroad terminal at Atlantic
and Flatbush Avenues, is slated
to include three million square
feet of office space, 400,000
square feet of retail space, two
parking garages, 10 movie
theaters and 643 condomini-
ums. It was approved by the
Board of Estimate in October,
1986, and was immediately
challenged by community
groups on the grounds that the
project will add to local air
pallution and could displace
many lower income residents
near the development.
Community leaders say Rose
Associates wants to assign its
interest in the proiect to Forest
City/Ratner, developers of the
downtown Metrotech project,
because it has not been able to
find an anchor tenant for the
office space and cannot obtain
bank financing.
"If Rose is out of the picture,
it makes a whole new 0011-
game," says Ted Glick, co-chair
of the ATURA Coalition, which
is fighting the project. "Forest
City/Ratner is not committed to
the Rose plan," he says, and
may be willing to work with
community groups to redesign
the project. 'With a new
developer, there's an oppartu-
nity to bring up issues [we're
concerned about] and reach a
settlement," adds Tom Rothchild,
attorney for a block association
that filed suit against the project.
A Forest City spokeswoman
would neither confirm nor deny
their interest in the project.
Rose's attorneys, the firm of
Kaye, Schaler, did not return
phone calls.
Monetary suppart for the
project from the city may also
be weakening. A spOkesperson
for the Public Development
Corporation (PDC), Which is
backing the proiect on behalf of
the city, acknowledges that city
funding for the development
may be put on hold. "The POC
must reduce its capital spending
1 0 percent next year as part of
the city's overall spending cuts,
but there is no final decision yet
what those reductions would
be," says Lee Silberstein, a
spokesperson for POC. Calling
Atlantic Terminal a "high
priority," he says, "It wouldn't
fire ExIt After a fire in this building, 1724 Crotona Park East, the city
ordered homesteaders from the Inner City Press/Community on the
Move group to vacate the building as well as an adjacent property,
1728 Crotona Park East. Some of the homesteaders have been offered
alternative housing. but now Bronx Borough President Fernando
Ferrer is requesting inspections of a number of other Community on
the Move buildings in the Bronx.
be cut, but it might be deferred"
to next year.
Rose's attorneys have only
said the developer is loaking to
bring equity portners into the
project, according to attorneys
for the ATURA Coalition, which
is challenging the UDAG.
If there are changes either in
the developer or the scope of
the project, new approvals may
be needed and provide a new
opportunity for community
groups to influence the project.
But what types of reapprovels
would be needed would depend
on the changes that are sought,
Rothchild says.
Attorneys for Rose and the
ATURA Coalition are scheduled
to argue motions on the UDAG
case in federal district court this
month. The suit claims the
UDAG grant violates the 1986
Fair Housing Ad because the
federal Housing and Urban
Development agency did not
consider secondary disploce-
ment of low income residents
when awarding the grant.
A suit filed in state court
challenging the Board of
Estimate's approval because it
did not considerdisplacement
was dismissed by the state Court
of Appeals last ye(]r. A TURA' s
Clean Air Act challenge lost in
federal District Court.
One other suit, filed by a
block association that is
challenging new traffic patterns
in the area around the project,
remains. 0 Todd BreuI
AIDS HOUSING
MONEY
New York City officials and
AIDS activists are hoping to
receive more than $25 million
from the federal government to
pravide housing for with
AIDS and AIDS-related illnesses.
The money is expected to
come from a new hOusing
program known as the AIDS
Housing Opportunities Act,
which wos included in the 1990
National Affordable Housing
Act approved by Congress in
October. The bill authorized
$156 million for the next fiscal
year, subject to budget appro-
priations approval.
Rep. Charles E. Schumer (D-
Brooklyn), one of the act's spon-
sors, says New York City would
receive abaut $26 million if the
bill is fully funded by Congress
for the next fiscal year. In addi-
tion, the city would be eligible to
compete for further money
distributed as grants from the
federal Department of Housing
and Urban Development.
Jennifer Kimball, a spokes-
person for the Dinkins admini-
stration, says, 'We hope the
money is appropriated. AIDS
housing is a vital issue."
The AIDS housing bill is the
first substantive federal ack-
nowledgment of the severity of
the housing crisis for peaple
with AIDS. According to esti-
mates by the Partnership for the
Homeless, there are currently
some 32,000 homeless people
with AIDS nationwide. About
one-quarter of them live in New
York City, where with
AIDS comprise the fostest
growing segment of the
homeless population.
Peter Smith of the Partnership
for the Homeless acknowleck1es
that the $26 million that couTd
be available to the city doesn't
nearly approach the need. "But
this is a huge step forward
when what wos available before
was zero," says Smith.
The bill includes funding for
a variety of programs, including
the development of community
residences and single-room-
occupancy apartments with
supportive services and rental
subsidies earmarked for people
with AIDS. Federal housing
programs in existance befOre
the passage of the bill were not
applicable to people with AIDS
beCause the hOusing department
does not consider AIDS a
disability.
According to Smith, some
250 people with AIDS languish
unnecessarify-ond
New york City
hospitals each day. Hospitals
cannot release patients Who
have-no home to return to. 0
em LIMITS/JANUARY 1991/15
By Erika Mallin
Shining Star
For love and almost no money, Winnie McCarthy runs
the Star of the Sea shelter for women.
S
he once was a businesswoman
with a comfortable house out-
side of Boston. Now Winnie
McCarthy lives in a small room
in a shelter for the homeless in Queens.
She didn't lose her job, become desti-
tute or for some reason or other slip
into the margins. What she did was
dedicate her life to helping the home-
less by working at the Star of the Sea
women's shelter in South Jamaica.
The Star of the Sea's logo is a haloed
figure with welcoming arms sur-
rounded by a beaming star. McCarthy
says this is a symbol of the shelter as
a beacon of hope in a sea of suffering.
What she doesn't mention is that she
herself seems to embody this image.
On even the grayest South Jamaica
days, McCarthy exudes energy and
hope, striding through the run-down
neighborhood and speaking as fast as
a sportscaster. And her white, shoul-
der-length hair frames her alert
face ... well, like a bright halo.
When McCarthy talks about the
homeless people she works with, she
expresses compassion: "The people
we see who come through the door are
not always gentle," she says. "What
we see is the anger of trying to survive.
But knowing a person one-on-one,
you see their gentleness and their
gifts." When McCarthy talks about
herself, she's not so generous. Asked
why she decided to move to Star of the
Sea at 145-32 South Road, she replies
swiftly: "I just wanted to do some-
thing more with my life." But behind
that one-line answer is the story of a
unique and spiritual commitment to
public service.
Becoming Involved
Winnie McCarthy was born and
raised outside of Boston in a working
class family. After 25 years as an
administrator in a paper company,
she left her job and became certified
as a home aide in order to care for her
mother in a nursing home. After her
mother died, she joined the Peace
Corps and served in the Philippines.
She later joined a Jesuit organization
and went to Washington state and
worked with the elderly. It was dur-
ing this time that she first became
a/JANUARY 1991/CITY UMITS
involved with the homeless.
"I used to stand on the street in the
bad part of town and watch the street
people," McCarthy remembers. "I
began noticing that they were being
kicked out ofthe local diners because
they had no money, so I got coffee
urns set up serving coffee on the street.
I was fearful at first, but within a
couple of weeks they were very kind
to me and wouldn't let anything hap-
pen to me."
After McCarthy returned to Massa-
chusetts, a friend told her the Star of
the Sea needed assistance and she
made her move. When asked a second
time about her decision, she says,"1
don't think of it as unusual. I don't
know what to say except I knew it was
We Ire all sisters
responsible for
each other
the right thing to do ... J always simply
trusted that God would provide." For
the past decade, McCarthy has volun-
teered her time and commitment to
Star of the Sea. This is the first year
that she will receive a salary.
It seems that the only way to ex-
plain McCarthy's depth of commit-
ment is religious faith. But like every-
thing else about this woman, this
devotion is hard to put into a neat
category. McCarthy is no longer a part
of the Jesuit community and she shuns
direct affiliation with the organized
church. Yet she is deeply religious.
With her, it seems, the relationship
with God is one-on -one and extremely
private. But it shapes everything she
does.
Originally founded by Sister
Angeline Rasomialay with the help of
the Pius V Church of Jamaica, the Star
of the Sea doesn't fit the standard
image of cavernous, dangerous shel-
ters for the homeless. Just 12 home-
less women and their children live
there, along with McCarthy and an-
other staff member, Haogi Dorsey. (A
third staff member, co-director Sheilla
Desert, is currently on leave.)
"Our philosophy is that we are all
sisters so we are all responsible for
each other," says McCarthy. This
translates into close relationships that
transcend the usual boundaries of
"staff member" and "client." And all
the women must either do chores at
the Star of the Sea or volunteer work
in the community.
Ivy, one of the shelter residents,
says, "When I first came to Star of the
Sea, I wasn't interested in anything,
but Winnie kept encouraging me,
saying I could do it." Ivy came to Star
of the Sea in 1988 after there was a fire
in her house and she was unable to
pay the rent. These days, the quiet 51
year old helps run the single-room-
occupancy house across the street and
she plans to attend York College to
study to become a social worker.
Star of the Sea's staff director,
Haiogi Dorsey, 29, says it is impos-
sible for residents to sit around and
waste their lives away at the Star of
the Sea. "It's too personal here, there
are too many eyeballs on you, too
many people interested in you. We
just try to break bad habits of poor self
image and [help people] learn what
they feel good about doing."
No City Money
Besides offering a close-knit, car-
ing environment for homeless women,
there is another aspect of Star of the
Sea that is far from usual: the shelter
relies solely on contributions and
grants and doesn't accept a penny of
money from the city. McCarthy says
this policy is a way to counter de-
pendence on institutions and encour-
age responsibility to the people in the
shelter and the local community.
This approach has attracted atten-
tion and numerous community people
have stories about Star of the Sea and
Winnie McCarthy. Rev. Anthony
DiLorenzo, who worked with Star of
the the Sea for five years, remembers
when prostitutes used to pack the
corners near the shelter. "Winnie used
to walk down the street with her big
dog, who couldn't hurt a flea, and
pass out cookies to the prostitutes and
gently tell them to leave and they
would go. They knew instinctively
she was compassionate, they even
would protect the shelter, helping the
elderly residents cross the street or do
errands."
1
The staff at the shel-
ter often attribute their
good fortune to faith.
They talk about the time
when 40 loaves ofbread
were donated to the
shelter but there was no
place to store them. The
next day the problem
was solved: two freez-
ers arrived on a truck.
Another time the shel-
ter was in need of some
extra volunteers and
Elizabeth Bartlett, an ad-
ministrator at the local
hospital, came to donate
furniture. That after-
noon she quit her job,
activated her social se-
curity and moved in to
help run the shelter. She
lived out the rest of her
life at Star of the Sea.
Permanent Housing
McCarthy's next ef-
forts focused on two
abandoned homes right
next door to the HUD
property. Aiming to cre-
ate small single-room-
occupancy homes, Mc-
Carthy bought the first
building from the city's
housing department and
proceeded to have it re-
habilitated. She then
raised funds to buy the
second home and re-
ceived money from the
state's Homeless Hous-
ing Assistance Program.
Looking down the block,
a volunteer for Star of
the Sea, Alice Ann El-
kin, declares, "We've got
the state, city and fed-
eral government in on
this one street!"
In the last decade
there have been a num-
ber of changes at Star of
the Sea. There was a
time, McCarthy recalls,
when most women
could find a job or a
place to live in about
three months. These
days the average stay is
more than a year. So it's
no surprise that the shel-
ter has branched out and
McCarthy has started to
eye abandoned build-
ings in the neighbor-
hood as a resource for
permanent housing.
CreIting CommunItr. Winnie McCarthy (third from left, in the back) surrounded
by residents and workers from Star of the Sea.
But this still isn't
enough to satisfy Mc-
Carthy. She's already
looking around the
corner to a two-story
house that she's trying
to renovate along with
the Veterans Service Cor-
poration, a local non-
profit group. The hoped-
for result is housing for
homeless veterans. She's
also keen to help develop
a youth and community
center two blocks away,
at the Arjune House on
Inwood Street. (The
Arjune House is the site
where policeman
Edward Byrne was killed
First she set her sights
on a dilapidated house directly across
the street. "Every day I watched that
house being vandalized, stripped of
all its plumbing, people carrying out
pieces and parts," McCarthy recalls.
When the house was completely
boarded-up, she made some enquiries
and found out that the property was
publicly owned by the federal Depart-
ment of Housing and Urban Develop-
ment (HUD). She asked HUD whether
she could purchase and rehabilitate
the property in early 1986. HUD re-
fused. But this didn't stop McCarthy.
She embarked on a one-woman cam-
paign of persuasion, deluging HUD
with letters and calling them at least
once a week. After about a year of
pressure, HUD finally relented and
agreed to lease her the house and give
her the right to purchase the property
as long as she could find money on
her own for rehabilitation.
True to form, McCarthy raised funds
through contributions, construction
materials were donated and labor was
provided free of charge by volunteers.
She spread news about the help she
needed through the Star of the Sea
newsletter, which has a circulation of
700 and goes to individuals, civic
groups and churches. The house is
now almost ready for its new occu-
pants, and will soon be sold to the
South East Queens Task Force, a
housing development corporation that
was created by McCarthy and Assem-
blywoman Barbara Clark and includes
more than 15 Jamaica community
groups and local and state officials.
in 1988 while protecting
a man who provided the city with in-
formation about local crack dealers.)
McCarthy says she'd like to see the
veterans volunteering at Arjune
House, tutoring young people in the
neighborhood. "There are all kinds of
ways to do things." she says. "We
have to bring all kinds of people and
groups together."
Already this' is happening in South
Jamaica, as Star of the Sea provides
shelter and helps develop housing
and a sense of community. When
summing up Winnie McCarthy's
contribution, Ivy puts it best: "I just
think she has a god-given gift for
loving." 0
Erika Mallin is a freelance writer liv-
ing in New York City.
By Cory Johnson
Return Offenders
The city's welfare hotels are back in business.
Who's making money from the misery?
L
ate last June the Dinkins ad-
ministration proudly an-
nounced that all families would
finally be out of the city's mis-
erable welfare hotels by the end of
July. But the very next day
new families were arriv-
ing at those same hotels.
Six months later, the city's
welfare hotel business is
back in full swing.
While the city is assidu-
ously avoiding the most
notorious of the welfare
hotels, families are being
placed in hotels that fail
to meet court-ordered
standards because they do
not include bathrooms
and cooking facilities.
And the city is again dol-
ing out thousands of dol-
lars a day to hotel owners
that include tax evaders, a
convicted felon and oth-
ers with long histories of
running shabby hotels.
City officials say a sud-
den surge in homeless
families requesting shel-
ter has forced the return
of the welfare hotels. The
city began the year with
1,445 families in hotels
and by June had reduced
the number to just 157.
Now there are nearly four
times that number of fami-
lies in hotels, and the time
families are expected to
stay has doubled.
ing quickly," says Wackstein. "Word
travels fast and by June we began to
see this large increase in applica-
tions where we had never seen an
entry rate like that before. If the
Under pressure from
Congress, which foots half
the tab for sheltering fami-
DeiI VII: A homeless family outside the Allerton Hotel.
lies in hotels, in 1989 the city began
to discontinue using the hotels. In
their place, the city increased its
production of permanent and transi-
tional housing for the homeless (see
homeless family census, page 4).
The result, says Nancy Wackstein,
who heads the Mayor's Office for
Homelessness and SRO Housing, has
been an increase in the number of
families seeking assistance. "People
began to see that you could get out of
the hotels and into permanent hous-
a/JANUARY 1991/CITY UMITS
number of entries had stayed what
they were, we would have been fine."
Victim of Success?
Advocates for the homeless dis-
agree. They say the city didn't meet
its own construction schedule of
building at least 3,534 transitional
shelter units by the summer-it built
2,900-and failed to heed warnings
that the number of families seeking
shelter had begun to rise. "It is outra-
geous- that homeless families should
have to pay for the city's own faulty
planning," says Steven Banks, an
attorney with the Homeless Family
Rights Project.
Banks dismisses city officials'
contention that the upsurge in fami-
lies seeking shelter is the result of
word on the street that there was a
fast track to a new apartment. "Rather
than the city being the victim of their
own success, the families are suffer-
ing from the city's failures and short-
falls."
Now the city is filling
up the same hotels it said
it would empty by the end
of July and is violating a
court order by choosing
hotels with insufficient
facilities for families, po-
tentiall y risking the health
of hundreds of children.
Only the owners of the
welfare hotels stand to
benefit.
According to the
mayor's office, the proc-
ess of choosing which
hotels will get the city's
homeless business is con-
fidential. "We're trying to
choose the best ones we
can," says Wackstein, "but
a lot of hotels just don't
want to take these people."
This seems hard to be-
lieve, given the city's long
history of paying top dol-
lar for a squalid room. The
city now spends an aver-
age of $2 ,250 a month for a
hotel room-a tab that
would cover some of the
priciest apartments in
town. Even at the lowest
end of the scale, where the
city pays $65 a night for a
room, owners stand to
make nearly $2,000 for
sheltering a family for a
month.
Family Affair
Some hotel owners have appar-
ently thrived off the business. Four
of the 12 hotels the city is currently
using are operated by four family
members-Jacob and David Tepper
and Sol and Bruce Burger-who are
in a partnership that has run welfare
hotels in New Jersey as well. The city
has been using the family'S hotels for
at least seven years.
Today the city is sending nearly
half the families it places in hotels to
facilities operated by the family: the
Hamilton Place, Lincoln Atlantic,
Cross Bronx and Lincoln Court. Some
300 families are currently sheltered
in these four hotels, netting the family
close to $20,000 a day. Yet these
same hotels have a combined 207
housing code violations and an over-
due tax bill of $16,882, according to
city records.
Jacob Tepper doesn't find this
alarming. "I make very little money,"
he says from his car phone. "I'm not
getting rich." And he dismisses the
housing code violations as just a fact
of life. "The Hamilton Place has 104
violations, but you go into any apart-
ment building in the city and you are
going to find violations like that. I
am just trying to make a living. I'm a
hotel owner. What am I supposed to
do?"
One thing he did do was scrape
together the cash for a $3,000 cam-
paign contribution to Mayor David
Dinkins-the same man who as Man-
hattan borough president urged the
city to get out of the welfare hotel
business. Asked if he thought his
contribution would help get place-
ments of the city's homeless in his
partners' hotels, Tepper responds,
"Everything has an effect on ever-
thing, that's the way the city works."
Another longtime welfare hotel
profiteer who has resurfaced in re-
cent months is David Fuld. Fuld was
a part owner of some of the most
infamous welfare hotels in the 1980s:
the Latham in Manhattan, Jamaica
Arms in Queens and Brooklyn Arms
in Brooklyn. In its heyday, the
Brooklyn Arms ran up more than
600 housing code violations and the
city went to court to force the owners
to repair hazardous conditions. The
city also needed a court order to
Longtime hotel
profiteers are
resurfacing.
force Fuld and his partners to make
repairs at the Latham.
Now Fuld is taking in families at
two new locations: the Colonial and
Lawrence hotels in Queens. Last
August there wasn't a single home-
less family at either of these hotels;
63 families are now there. The two
hotels have 26 housing code viola-
tions and more than $2,600 in over-
due taxes, according to city records.
Fuld did not respond to numerous
phone calls. His attorney, Steven
Orlow, insisted that Fuld is out of
the country. But Louise Goodrich,
the manager of the Lawrence, says
Fuld was in town and that he calls in
for messages.
Illustrious Past
Another old-timer enjoying a re-
surgence in the homeless business is
Lawrence Meinwald, who ran the
Allerton, Allerton Annex and Madi-
son hotels. Meinwald has a particu-
larly illustrious past. In 1979, two
residents ofMeinwald's single-room-
occupancy Village Plaza Hotel swore
in affidavits that he threatened ten-
ants with a pistol, according to the
ViJIage Voice. Larry Klein, a former
head of the Mayor's Office for SRO
Housing, told the Voice that condi-
tions in that hotel were the worst of
any in the city.
In 1984, the city's Human Re-
sources Administration (HRA) an-
nounced it was going to stop sending
families to the Allerton and Allerton
Annex because Meinwald was se-
cretly shifting families into the
Madison, which the city had already
ceased using because of poor condi-
tions. Now the city is playing its own
version of hide-and-seek at the Aller-
ton Annex.
The annex doesn't show up on the
city's list of hotels currently being
used for families; it's found in the
category known as special residences,
which include facilities especially
for pregnant women and their
husbands or boyfriends. "After the
birth you might find they show up in
the Allerton under the 'family' sec-
tion of our list," says Vincent DiGesu
ofHRA. "But we don't place families
there [the Allerton] any more. They
just become families there." There
are 86 such nonfamilies at the annex.
Fittingly, Meinwald's name
doesn't appear on the Mayor's Office
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of Homelessne.ss and SRO Housing
records as the owner or manager of
the Allerton. That title belongs to his
friend Carol Turner, who once barred
social workers attempting to assist
families in a Meinwald hotel. But the
city Finance Department's overdue
tax bill of nearl y $8,400 for the Aller-
ton is sent to the attention of Law-
rence Meinwald.
For years, Anthony Zito's Bayview
Hotel in Sheep shead Bay has been
one of the most expensive of the wel-
fare hotels used by the city. The city
spends more than $280,000 a month
to keep some 90 families at the
Bayview.
Judith Rossinow, the manager of
the Bayview says the hotel is now a
nonprofit "and it's one of the nicest
places in the city." She also says Zito
is no longer involved in operating
the hotel.
But Len Robertson of the Brooklyn
district attorney's office scoffs at that
claim. "It's common knowledge that
Zito runs the place. He just doesn't
want it publicized," says Robertson,
who has good reasons to keep tabs on
the Bayview's landlord.
In 1971 Zito was sentenced to four
years in prison for loan sharking. In
1983 Zito was indicted for failing to
pay the city more than $100,000 in
hotel occupancy taxes, but the case
was thrown out on technical grounds.
From October 1984 to February 1985
and again in 1987 the FBI had the
Bayview under electronic surveil-
lance-leaders of the Luchese crime
family met regularly there with paint-
ers union officials to discuss bid-
rigging and labor "peace," according
to a court affidavit. In 1987 Zito was
arrested on charges of paying two
bribes totaling $3,500 to an under-
cover agent posing as a city inspec-
tor. Zito pled guilty and received
five years probation.
Among the other hotels being used
by the city to shelter homeless fami-
lies with young children, there are
few candidates for the do-gooder's
hall of fame. Mitch Suss, the owner
of the Bronx Park Hotel, owes the
state more than $187,000 for with-
holding taxes deducted from employ-
ees, pay checks but never paid to
!I
authorities, according to state tax
department records. And Rashmi
Mehta's Cosmopolitan Hotel mixes
its welfare family business with an
hourly rate for the "hot sheets" trade.
Chances are business for all these
hotel owners-and others like them-
will continue to grow in the coming
months. For all the mayor's talk about
the rights of every New Yorker to
have a decent place to live, the ad-
ministration seems incapable of fol-
lowing through.
"I'll be honest with you," says
Nancy Wackstein from the mayor's
office. "There are other priorities.
The public has spoken and they say
they want more cops. Building hous-
ing is too expensive. The city's legal
requirement is only for emergency
housing. If you're looking for the city
to provide housing for all of these
people . . . well it just isn't going to
happen." 0
Cory Johnson is a journalist who has
written articles for New York
magazine, Time Warner's FYI and
the Village Voice.
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development community
Gary Hattem,Vice President
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10/JANUARY 1991/CITY UMrrs
Case in Point:
Williamsburg Court
This 59 unit low income housing develop-
ment, sponsored by the St. Nicholas
Neighborhood Preservation Corporation,
is located in Brooklyn's Williamsburg
section.
They needed $300,000 to complete
their $7 million plus financing package.
Could Brooklyn Union's Area Develop-
ment Fund help?
Sure we could-with a little help from
our friends, the l.ow Housing
Fund and Bankers Trust Company. They
each pledged $100,000 to match
Brooklyn Union's investment.
We've found that the Area Develop-
ment Fund is a working blueprint for
change in the economic and social life
of New York. If your company would
like to help as has Pfizer, Bankers Trust
Company and so many others, talk to
Jan Childress at (718) 403-2583. You'll
find him working for a stronger New York
at Brooklyn Union Gas, naturally.
GaS,
. Naturally
For Whom Does the
Port Authority Toll?
The Port Authority looks and acts like a private corporation.
They need to be reminded they're not.
BY DOUG TURETSI(Y
T
he next time you're backed up in traffic, waiting
to plunk a fistful of bucks into the hand of a toll
taker at one of the bridges or tunnels stretching
from New Jersey to New York, consider this: The
Port Authority of New York and New Jersey,
which controls the Hudson River crossings, has an annual
budget of nearly $3 billion. That's more than the nearby
states of Maine, New Hampshire and Vermont. Besides
the bridges and tunnels, the Port Authority owns or
operates some three dozen facilities in the metropolitan
area, including the World Trade Center, the airports and
the PATH train. The Port Authority itself employs more
than 8,000 people-and even has its own police force.
But unless you're a commuter, angered by constant tie-
ups at the bridges or tunnels or the latest threat of a toll
hike, chances are you don't give much thought to the Port
Authority. This relative anonymity may suit port officials
just fine. But since the agency is fed with taxpayer money
and is supposed to serve the public, it is worthy of serious
attention.
The first public authority in the nation, the Port Author-
ity is crucial to the local economy. According to the
agency's own figures, its airports generate some 243,700
jobs and $6.6 billion in salaries; its marine terminals
account for another 180,000 jobs and $4.5 billion in
salaries. The port agency operates-and in some cases
built-much of the city's vital transportation infrastruc-
ture.1t was created to bolster shipping activity at the ports,
but as the agency has grown and prospered, it has changed
course and undertaken glitzy real estate deals with ques-
tionable public benefits. Many say its time for the Port
Authority to get back to basics, but because of the way it
was set up, legislative officials and citizens have little in-
fluence over the agency's activities.
the Port Authority has grown and changed," says Goldmark.
Yet the question of whether the Port Authority was
reacting to changes or he!ping to accelerate them remains.
Take the piers in the five boroughs, for example. Once the
heart of the bustling Port of New York, most of what's left
of the shipping trade has moved to New Jersey docks. To
the Port Authority, it was easier to build new cargo ports
on the wide open shores of Elizabeth
and Newark than on the more con- Unless there's greater public interest
and oversight, the Port Authority will
continue to chart its own course.
Port Town
When the legislatures of New York
and New Jersey formed the Port Au-
thorityin 1921, New York's port was
preeminent in the country and at the
center of international trade. Ships
from Europe, South America, Asia
and the Caribbean steamed to and
from the city's piers. With the city's
docks thriving, local manufacturers
The Port Authority's
empire includes the
port, airports,
bridges, and the
World Trade Center
gested waterfront stretches of
Brooklyn or Manhattan. Yet many
experts argue that this was simply
short -sighted.
Even when a New York venture
like the Red Hook container port
proved to be highly successful, the
port agency appeared reluctant to ac-
knowledge it. Rather than quickly
expanding the facility, the Port Au-
thority engaged the operators of the
container port and public officials in
boomed as well. For tens of thou-
sands of immigrants, blacks migrating from the south and
other workers with limited skills, jobs flowed from the
city's waterfront.
The Port Authority's first-and only-responsibility
was to ensure the continued growth of port commerce.
Central to this was the improvement of the freight railways
that served the piers. No direct rail access existed across
the Hudson. To move goods west into the nation's heart-
land freight had to travel all the way to a small town near
Albany. The Port Authority was charged with construct-
ing a rail freight tunnel from Bay Ridge, Brooklyn, to
Greenville Yard in Jersey City, forging a direct railway link
to the rest of the country. The Port Authority'S first
chairman, Eugenius Outerbridge, called this project the
"keystone" of the agency's mission.
Nearly 70 years later, no such tunnel exists and the
region's port is no longer predominant. In a 20-year period
stretching from 1967 to 1987, the Port of New York's share
of the nation's cargo dropped by 50 percent. Piers in the
five boroughs are moribund. That decline has mirrored
the city's alarming loss of manufacturing jobs, with some
200,000 industrial jobs disappearing since 1979.
But the Port Authority continued to grow and play an
increasingly large role in the local economy. With reve-
nues streaming in from its bridges, tunnels and airports,
the Port Authority sought new outlets for expansion and
carved a new agenda for itself. This new agenda has
included such controversial real estate projects as the
World Trade Center and proposed waterfront luxury
developments in Hunters Point, Queens and Hoboken,
New Jersey. To John McHugh, an attorney specializing in
transportation issues and a longtime critic of the Port
Authority, the agency has ignored its mandate in favor of
real estate deals and other projects that produce few well-
paying long-term jobs for working class New Yorkers.
"The lroblem is freight. The Port Authority was con-
ceive because of freight," says McHugh.
But Peter Goldmark, the executive director of the Port
Authority from 1977 to 1985 who now heads the Rockefeller
Foundation, argues that such a viewpoint is misguided,
ignoring the authority'S ability to adapt to changing needs
and economics. "As the region has grown and changed,
an arcane debate over the size of con-
tainers handled.
It seems the port agency decided New York's piers
simply weren't worth the effort."I think the Port Authority
repeatedly fails in its mission to promote the port, to en-
hance the port in respect to New York City," says Steven
DiBrienza, chairman of the City Council's subcommittee
on the waterfront.
Changing Times
The Port Authority dramatically altered its role in the
regional economy in 1961. Its agreement to build the
World Trade Center and take over the bankrupt Hudson
and Manhattan commuter rail line-now known as the
PATH train-marked two important changes in the port
agency's agenda. The construction of the 110-story twin
towers was a formidable leap into real estate develop-
ment; the purchase of the PATH became the agency's
wedge against further involvement in railways.
The Port Authority was urged into the trade center
project by David Rockefeller, the chairman of Chase Man-
hattan Bank. Chase had just primed the downtown land-
scape with its Chase Plaza project and was seeking further
development to escalate local real estate values. The twin
towers were just the thing. And to push the project before
the Port Authority Rockefeller had an important sup-
porter-his brother Nelson, the governor of New York.
The only public officials with power over the Port
Authority are the state governors, who appoint the agency's
board of commissioners and can veto board decisions. But
before New Jersey's governor would agree to the huge
investment by the Port Authority in New York, he wanted
something for his state. The PATH train was the answer.
The Port Authority had long resisted taking over the
PATH. For years, agency officials had seen rail lines as
just money losing propositions. But now that it wanted to
build the World Trade Center, the Port Authority needed
to give something to New Jersey in exchange. Agreeing to
buy the PATH was the perfect salve for New Jersey.
Cleverly, the Port Authority exacted its own price in the
bargain. Agency officials added a restriction to their bond
notes that effectively prohibited the Port Authority from
further investments in railroads. The covenants forbade
the Port Authority from taking on any future rail projects
CITY UMrrs/JANUARY 1991/13
if the new projects
combined with the
PATH would create
deficits exceeding
one-tenth of the
agency's reserve
funds.
When the state
legislatures at-
tempted to repeal this
rule-and force the
port agency to build
much needed rail
links to the airports-
U. S. Trust Company,
a friend of the Port
Authority, filed suit.
According to "The
Public's Business" by
Annmarie Hauck
Walsh, the company
held some $100 mil-
lion in Port Authority
bonds and U.S.
Trust's former chair-
man, Hoyt Ammidon,
sat on the authority's
board. Not only did
U.S. Trust win its case
before the Supreme
Court, but the Port
Authority picked up
the tab for legal fees.
two waterfront devel-
opment plans-one
on each side of the
Hudson to satisfy the
governors. The plan
for Hunters Point calls
for the construction
of one of the largest
developments in the
city's history. It
would include more
than 6,000 luxury
apartments, two mil-
lion square feet of
office space and a 350-
room hotel. It was
approved by city offi-
cials despite heated
opposition from the
local community (see
City Limits, Aug/Sept
1990). It's no small
irony that one of the
Port Authority's ma-
jor real estate project's
is adjacent to the city's
strongest industrial
neighborhood. Esca-
lating land values
sparked by the devel-
opment pose a direct
threat to the area's
blue-collar economy,
the very same econ-
omy at the heart of
the Port Authority's
original purpose.
The construction
of the World Trade
Center proved re-
markably profitable
for the Port Author-
ity. It was also con-
troversial. While
there were few-if
any-private compa-
nies willing to build
unglamorous facili-
ties such as intermo-
dal freight yards,
there were plenty of
private developers
Missilll the Boat: Critics say the Port Authority doesn't pay enough attention to
unglamorous duties like minding the New York ports.
The Hoboken
waterfront plan is
nearly as huge as its
Queens counterpart.
Calling for some 3.2
million square feet of
luxury residential
and commercial
space in waterfront
high-rises, the project
is just as controver-
itching to get behind spanking new projects. Critics said a
governmental agency like the Port Authority simply
shouldn't be involved in speculative real estate deals-
especially when it gets to erect its buildings tax free. (Last
year alone the Port Authority'S tax-exempt World Trade
Center cost the city's coffers some $59 million in property
taxes.)
Jump Start
But the floodgate was already open and in the early
1980s, the Port Authority solidified its role in develop-
ment. Looking at the declining waterfront in Hunters
Point and Hoboken, port officials began planning two
massive new real estate developments. In the wake of New
York's fiscal crisis of the 70s, many saw real estate devel-
opment as the way to jump start the local economy.
The Port Authority has committed $250 million to the
sial as Hunters Point. A referendum passed last summer
opposing the Port Authority's plan for Hoboken hasn't
stopped the agency from continuing to push the water-
front project. "We have been fighting them for 10 years,"
says Sada Fretz of Hoboken's Coalition for a Better Water-
front. "Another developer would have packed up and left.
The fact they've stayed shows how powerful they are."
Even as former Port Authority executive director
Stephen Berger launched a back-to-basics $5.4 billion,
five-year capital program directed at improving transpor-
tation networks, port facilities and area airports in 1987,
the agency continued to flirt with real estate deals. Last
year, the agency was prepared to grant Brooklyn Heights
piers 1 to 5 to developers Arthur Cohen and Larry Silver-
stein for just $150,000, a future payment based on the size
of any project built there and a cut of future profits. Well-
connected Brooklyn Heights activists were able to torpedo
the deal, but it is rare that
community activists have
any influence on Port Au-
thority plans.
Now the Port Author-
ity looks more like an
international conglomer-
ate than a government-
created agency, with far-
flung trade offices and a
diversified portfolio that
includes industrial parks,
an office project for New-
ark-based legal firms and
an incineration plant
under construction in
New Jersey. To Stanley
Brezenoff, the former first
deputy mayor of New
York who is now execu-
tive director of the port
agency, it's time to link
such projects to more
basic Port Authority serv-
ices. "We need to think in
terms of economic devel-
opment as tying our eco-
nomic development proj-
ects to our basic func-
tions," says Brezenoff of
his plan to reemphasize
the agency's role in mass
transportation and marine
freight. But Brezenoffhas
no intention of side-track-
ing the real estate deals.
Tunnel VISion: The Port Authority has poured money into bridges and tunnels from New York to New Jersey.
The result: more gridlock and air pollution.
Bonded
How can an agency so big be so relatively little known?
Part of the answer lies in the fact the agency has such
limited accountability to the public and elected officials.
Only the governors have direct influence over the au-
thority, but even they use their power sparingly. Since the
Rockefeller administration, New York's governors have
paid only sporadic attention to the port agency, adding to
its relative anonymity on this side of the Hudson. But
there's one set of voices the Port Authority listens to very
closely: the bond market.
While the regional economy has taken a nose dive, the
Port Authority remains flush. The recent move to hike
tolls and the PATH fare was pegged to the agency's
ongoing multi-billion dollar construction program. The
Port Authority's capital for such programs comes from
bonds it floats against projected tolls, fares, rents and other
revenues. Unlike New York City'S bonds, which have
been put on credit watch, the Port Authority'S remain
sound. Todd Whitestone, a managing director at Standard
& Poor's, says this is "based on [the Port Authority's] wide
variety of revenue sources and relatively strong financial
position."
This stands to reason. The board has always been
dominated by corporate and financial leaders. At the Port
Authority'S helm have been men-the agency's 12-mem-
ber board of commissioners has been an almost exclu-
sively male enclave-from major financial and invest-
ment institutions in the region. In the fast, Bankers Trust
and Mutual Benefit and the Prudentia insurance compa-
nies have each had representatives on the Port Authority's
board for dozens of years. The authority's current chair-
man, Richard Leone, is a past president of the New York
Mercantile Exchange and until 1989 was a managing
director at Dillon Read & Company, a leading brokerage
firm. Other current board members include Robert Van
Buren, the president and chief executive officer of Mid-
lantic Corp., a huge bank holding corporation, and Wil-
liam Ronan and former New York mayor Robert Wagner,
directors of Crossland Savings Bank.
Such connections between the Port Authority and
major financial and investment firms mean more than just
a back-slapping comraderie. The agency emphasizes reve-
nue-making projects as a means of preserving its inde-
pendence from political influence and government con-
trol. The trade-off is a dependence on the demands of the
bond market, where the Port Authority acquires its capital
for expansion. The result is a public agency that operates
much like a private venture, measuring its projects by rate
of return rather than broader social assessments. Rick
Cohen, the former director of Housing and Economic
Development in Jersey City, which lies in the heart of
authority'S domain, asks, "Does the Port Authority have a
different mission than the LeFrak Organization?"
Bottom-Line Works
The insularity of the board is reflected in its bottom-line
response to public works. -An unreleased 1980 Port Au-
CITY UMIfS/JANUARY 1991/15
thority market study of the long-neglected freight tunnel
project revealed a wealth of public benefits. Projecting
into the 1990s the study estimated the freight tunnel
would remove some 1,700 trucks from the area's highways
each day, reducing traffic, road maintenance and air
pollution. Additionally, the study estimated that a $1
billion investment to construct the cross harbor tunnel
would generate some $600 million in wages, $250 million
in business income, $54 million in regional income and
sales tax and $163 million in federal tax revenues. Today,
there's still no tunnel in the works-the project never
materialized because there's no way such broad public
benefits could be reflected in the agency's own balance
sheets.
Likewise, the agency also often fails to integrate its
efforts with the needs of nearby communities. Says Stephen
Strahs, director of the Tri-State Economic Justice Net-
work, a coalition of 10 community and labor groups,
"Over the years the Port Authority has not been attentive
to the needs of the low income communities near its
faciliijes." He argues that the Port Authority should be
using its $5.4 billion capital plan for airport and other
reconstruction projects as a means for creating an invalu-
able job-training program. Strahs' group has also just
proposed that the port agency create a $30 million com-
munity capital fund for loans to businesses that will
employ disadvantaged workers. Fund investments would
be based on both monetary and social return.
Activists aren't the only ones who have said the agency
should be more accountable to communities. In 1952 a
congressional committee suggested the Port Authority
create a board less dominated by corporate interests. Yet
the authority's board still lacks even a single member who
could be said to represent community, labor or other
perspectives.
Early Days
The genesis of the Port Authority of New York and New
Jersey was a long squabble between the two states. For
dozens of years the states waged head-to-head competi-
tion over port business. Much of the competition stemmed
from the haphazard growth of railroads serving the Port of
New York. New Jersey officials also complained that
railroads shipping goods east failed to charge for the cost
of ferrying cargo-laden rail cars across the Hudson to New
York's ports.
In 1916 complaints over railroad rates finally led to a
formal action before the Interstate Commerce Commis-
sion, with New Jerseyites demanding that rates to their.
side of the Hudson be lowered. Two years later a special
bi-state commission formed to address the issue. Their
eventual recommendation: the creation of the Port Au-
thority of New York and New Jersey to ease the competi-
tion by improving rail links and terminals and promoting
business for the entire port region.
This new agency-then called just the Port of New
York Authority-was the first of its kind in the United
States. Created by government, this new entity could
operate much like a private business. Known as a public
authority, it was freed of many of the legal, administrative
and financial restraints imposed on a traditional govern-
mental agency. The public authority could buy, lease or
operate facilities and collect revenues, which, in turn,
would be plowed back into its own operations. Although
the public authority couldn't levy taxes, it had another
la/JANUARY 1991/CII'Y UMITS
incredibly lucrative way to generate funds for its own
expansion: The Port Authority could sell bonds to Wall
Street investors.
The concept of public authorities sprang from the turn-
of-the-century Progressive movement. To these reformers
the inefficiency, patronage and corruption that plagued so
many government efforts could be cured by an essentially
business-like approach towards public administration.
Civic-minded business leaders, like the Progressive re-
formers themselves, would make decisions based on ra-
tional assessments rather than political influence. (That
business leaders possessed their own biases and political
relationships apparently never concerned the Progres-
sives.)
Despite its corporate foundation, the Port Authority has
not always been a rollicking success. It wasn't until 1931,
when the Holland Tunnel was turned over to the Port
Authority and the agency's coffers began to fill with the
nickels and dimes of commuters, that it had a profitable
venture. Likewise, the local airports that have become
highly lucrative Port Authority projects were originally
built by the city. (The Port Authority gained control ofthe
airports in 1947 after a battle between two legendary
public authority titans-Robert Moses and Austin Tobin,
who headed the port agency for some 30 years.) And the
World Trade Center, the towering symbols of the Port
Authority's empire, was initially bolstered by state leases
for office space.
In the years since its inception, the Port Authority has
become the model for similar public authorities through-
out the country, from the federal Tennessee Valley Au-
thority to such local entities as New York's Housing
Development Corporation. Robert Moses, New York's
"master builder," built much of his empire through the
free reign afforded him under the rubric of public authori-
ties.
As the Port Authority grew prosperous from its bridges,
tunnels and airports, the agency looked for new ways to
secure revenues. The development ofreal estate, whether
as luxury condos or industrial parks, appeared to fit the
bill. But all the new buildings in the world won't help keep
jobs in the area if businesses can't move freight through
the city's congested streets. "The heart of the beast is being
able to move goods in and out," says Anthony Riccio, a
former commissioner of New York's Department of Ports
and Trade.
Yet it's just this role as regional transportation planner
that the Port Authority had distanced itself from. Much of
the so-called economic development activity in the city is
focused on tax abatements for office towers.
It's an expense that may be more profitably applied to
nuts-and-bolts projects. Annmarie Hauck Walsh writes in
"Urban Politics New York Style," "Yet all of the highways,
loans, partnerships, industrial parks and tax abatements ...
cannot produce a fraction of the economic advantage that
low cost and efficient freight access to the container port
facilities and to the interstate lines could have provided
for manufacturing in the boroughs of New York City."
With its nine-figure budget, the Port Authority will
continue to playa central role in shaping New York's
future. That's why a growing chorus of critics say it's time
to pay closer attention to the agency and make sure it gets
routed onto the public's track. 0
Research assistance by Elizabeth von Nardroff.
Moving Towards Self-Sufficiency:
Critical Challenges In Difficult Times
THE PARTNERSHIP FOR THE HOMELESS
ACTION DAY '91
Join us on January 26th (gam-3:30pm)
The New School for Social Research
66 West 12th Street, Manhattan
Hon. Ruth Messinger, President,
Borough of Manhattan,
Keynote Speaker
Hon. Stephen J. Norman, Ass't Commissioner,
NYC Dep't of Housing Preservation and Development,
Homeless Housing Development
Peter P. Smith, Chair,
City Council Legislative Advisory Commission on The Homeless
Panels and Workshops on Homeless Health and Mental Health Care, Welfare Reform, Affordable Housing
Strategies, Models of Self-Sufficiency, Homeless and HIV/AIDS, Revisiting the Welfare Hotels, and more.
No fee. Lunch will be provided. To register, return form
to: The Partnership for the Homeless, 110 West 32nd
Street, New York, NY 10001-3274. Due to limited
seating, reservations must be in by January 21, 1991.
For additional informationcall Rosa Cintron, (212) 947-
3444.
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By Steve Rosenbush
Commons Concerns
Melrose Commons won't be for the common
people of the South Bronx.
D
olorinda liSanti recites with
pride each step she and her
husband have taken to make a
comfortable home out of the
small South Bronx apartment build-
ing they bought six years ago from the
city. Most ofthe big jobs-new walls,
new pipes, new wir-
ing-are finished .
Now they tend to de-
tails such as the new
marble threshold in
the doorway to the
bathroom.
"I go little by little
and all my money is
involved here," she
says, explaining that
she and her husband
never borrowed
money to work on the
building, which did
not even have run-
ning water when they
moved in as tenants.
revitalization of the South Bronx.
Grassroots community groups are
dead set against the project, which
will receive public funding but pro-
vide no new housing for low income
families, even though the median
income in the area is less than $10,000
potholes, drug activity is constant and
the city owns approximately 60 per-
cent of the property. To carry out the
proposal, the city intends to establish
a Melrose Commons Urban Renewal
Area.
The new development would in-
clude more than 3,000 new units of
housing and 750 apartments in reha-
bilitated city-owned buildings. City
officials estimate that the new apart-
ments would sell for between $90,000
and $120,000, making them afford-
able for families with incomes from
the upper $20,000 range to $53,000.
The project would
stretch from 156th to
163rd streets and
from Park to St. Ann's
avenues.
She is 54 and her
husband Guiseppe, a
retired construction
worker, is 65. They
came from Italy 25
years ago. Theirthree
kids, ages 19,21 and
22, all live at home.
There are several ten-
Rubble Ind R'-II: This section of the Bronx may one day include thousands of
condominiums.
There are currently
about 950 house-
holds in the area. Ac-
cording to the city's
housing department,
two-thirds of these
families would re-
main in buildings
that are due for reha-
bilitation, but the oth-
ers-including the
LiSanti's-would be
relocated. Officials
from the city say ren-
ters will receive as-
sistance from the city
to find new apart-
ments and home-
owners will be reim-
bursed for the ap-
praised value of their
property. LiSanti
ants who live in the other apartments
of the building and relatives live next
door. "It is like our blood here," li-
Santi says. "It is our future."
But the city has other plans for the
liSanti's three-story walk-up at 811
Courtlandt Avenue in Melrose. The
city plans to tear it down-to make
room for Melrose Commons, a major
new development proposal that would
displace numerous local residents and
businesses to clear space for the con-
struction of more than 3,000 apart-
ments for moderate and middle in-
come families.
Because of the city's economic
downturn, most major new develop-
ment efforts are being reconsidered
by the city's housing department and
Melrose Cominons has not yet moved
beyond the planning stage. But many
local politicians are supporting the
development as the linchpin to the
18jJANUARY 1991jCITY UMITS
a year. Review of the proposal is set to
start by early this year, but most local
residents still know very little-or
nothing-about it.
"My house too? I did not know
that," Jeri Johnson, the liSanti's neigh-
bor, says as she learns about the plan
that could lead to the demolition of
her home. Johnnie Patterson, who
lives nearby at 375 159th Street, is
also unfamiliar with the effort, and
expresses surprise when told that the
building where he lives may also be
destroyed.
Apartments for $90,000
The site where Melrose Commons
may rise is about one mile east of
Yankee Stadium. The 36-acre area is
filled with a mixture of small build-
ings, mom-and-pop businesses, va-
cant lots and empty tenements. The
sidewalks are cracked, the streets have
says, "I don't want the money. The
money they give us ... where would we
go?"
About 80 businesses with nearly
500 employees would also be dis-
placed. One of them would be Fred J.
Riehm Inc., a 90-year-old plumbing
business located at 838 Courtlandt
Avenue. It would be demolished to
make room for a new park. "Where
are we gonna get what we have?" says
Jean Mega, who has been a secretary
with the company for 13 years. "Where
are we going to buy a building? We are
in a perfect location for the Bronx, and
close to Manhattan." City officials say
business owners who rent space will
receive assistance to move and busi-
nesses that operate in their own build-
ings will be reimbursed for'the worth
of the property.
The man behind the plan for
Melrose Commons is Bernd Zimmer-
mann, an urban planner who formerly
led the city's Bronx planning 'office
and now works for the Bronx borough
president. In an interview with City
Limits last year, Zimmermann
described the benefits of Melrose
Commons: "We have a community of
poverty. This could bring a better
income group, a better socio-economic
balance .. .It's going to be the keystone
for redevelopment."
Jewel In the Crown
Zimmermann sees Melrose Com-
mons as the jewel in a crown of new
development efforts, including the
gentrification of the Grand Concourse,
plans for a privately developed shop-
ping center at 161st Street, construc-
tion of the Morrisania Industrial Park
and the revitalization of the "down-
town Bronx" shopping area between
149th and 161st streets. According to
his logic, for these efforts to thrive,
Melrose Commons must provide a
critical mass of people with more
spending ability than the average
South Bronx family.
This argument has persuaded a
number of local politicians, who are
welcoming the development with
open arms. With Zimmermann now
on staff, Borough President Fernando
Ferrer is clearly a primary supporter.
The local community board will
probably back the effort and Rep. Jose
Serrano is also in favor. His district
director, Michael Benjamin, says,
"Melrose Commons would provide
an infusion of working and middle
class families who could own their
own home and lend a stabilizing in-
fluence to an area that's pretty much
abandoned. "
Some of the people who live and
work in the area agree that a mix of
incomes is an important goal. But
how this happens is the source of
contention. "We would also like to
have people who have significant
income live in the area-but not at the
expense of people who are already
living here," says the Rev. Max Davies-
Jones of St. Simeon Episcopal Church
on Carroll Avenue. "Morally I don't
think that is justified. This area is the
poorest in the city of New York."
Slap In the Face
Blanca Ramirez, executive director
of South Bronx People for Change,
echoes his thoughts: "If you're a South
Bronx resident who is low income,
this is just a slap in the face. To demol-
ish an occupied building to make way
for middle class housing doesn't make
sense. It's morally wrong/' And Mat-
thew Lee, the organizer of a grassroots
homesteading group, Community on
the Move, adds, "There is no visible
benefit to low income people .. .It is
unconscionable to spend that much
money without doing something for
the people in the area."
Because Melrose Commons is still
in the planning stages, the nuts and
bolts details of financing and subsidy
arrangements are still being worked
out, according to Roz Post, a spokes-
person for the city's housing depart-
ment. All that is known at this point
are the general outlines of the devel-
opment, as described in an environ-
mental impact study that was done by
Tams Corporation, a consulting group,
and paid for by the United Nations
Development Corporation. The study,
which is 80 percent complete, has
cost $226,000, according to a spokes-
person from the city's planning de-
partment.
An architectural drawing of the
development from the study gives a
sense of what the project would look
like: blocks of four-story apartment
buildings surrounding large parks.
Many of these parks appear to be
accessible only to Melrose Commons
residents. As Ramirez from South
Bronx People for Change puts it: "The
buildings are going to be enclosed-
that protects them from 'those people'
in the rest of the neighborhood. But
they're not only locking themselves
in, they're also locking everyone else
out. What kind of message is being
sent to the rest of the neighborhood ?"O
Steve Rosenbush is a journalist for
United Press International.
Nowwe.neef
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CITY UMITS/JANUARY 1991/1.
111
1
""1':11
By Fran Barrett
For Nonprofits Less Money
Means More Organizing
I
n my 22 years of community work,
there hasn't been a year without
neighborhood groups facing
slashes from the government's
budget ax. During this time the non-
profit community has seen the city
face red ink many times. But there
was always state or federal or foun-
dation money that could heIr plug
the gap. Never before have al these
sources withered simultaneously.
The challenges have never been
greater than they are today. At the
same time, these challenges also pose
important opportunities for turning
nonprofits into leaner, meaner advo-
cacy organizations.
Because community groups rarely
control their own money, they rou-
tinely face "needs assessment based
cuts" by the city. This often means
some researcher sitting in a cubicle
in the Municipal Building has de-
cided that a slew of programs run by
neighborhood groups are no longer
necessary. Over the years, we've
become pretty adept at fighting these
kinds of budget cuts. Make the right
case to the administration and these
kinds of cuts usually disappear.
Anticipation
We also became good at anticipat-
ing the potential loss of fund-
ing from foundations. Com-
munity groups developed
antennas that told them when
foundation boards were shift-
ing their interests. Groups re-
acted accordingly. Some-
times what develored was a
kind of pathologica fundrais-
ing, with community groups
tailoring their programs to
very specific populations like preg-
nant teenagers in the South Bronx.
But now there's no chance for mere
repackaging. Predicting that their
own revenue sources have tightened,
foundations see themselves cutting
back. Likewise, the city's cuts are no
longer based on paper assessments.
They are very deep-and real.
These facts are not about to go
away any time soon. It's like we are
entering a marathon, and there's no
time to for a rest stop. What it is time
for is action and organizing.
This needs to happen on two lev-
els. First, nonprofit groups must take
a hard look at what they do. Each or-
SUPPORT SERVICES FOR NONPROFIT ORGANIZATIONS
Writing 0 Reports 0 Proposals 0 Newsletters 0 Manuals 0 Program
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2O/JANUARY 1991/CITY UMIrS
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ganization will have to make diffi-
cult, and sometimes painful, deci-
sions about what it is they really do
best. Next, community groups will
have to sit down together and dis-
cuss these decisions. It will mean
burying old hatchets, bringing egos
down a few pegs while forging new
partnerships. Together, groups can
decide who among them can best
provide anti-eviction services or job-
training programs to communities.
Back To Advocacy
Out of this process can come a
renewed sense of combined strength.
And it can pave the way for a shift
back to advocacy, a role community
groups have too often forgotten in
recent years.
By refocusing our energies on or-
ganizing communities, neighbor-
hood groups will return to some-
thing they have done very success-
fully in the past. And they will alter
the basis on which their own work is
judged by funders and constituents.
Funding sources will be forced to
evaluate groups not just by which
special population they serve, but
on their ability to spur change.
But all of this must happen soon.
If we don't organize ourselves, the
money will make the choices for
us.D
City View is a forum for opinion
and does not necessarily reflect
the views of City Limits.
How To
Win Friends
and Influence
People:
Give them
a subscription
to City Limits!
By Eric Weinstock
Of Homes and Cadillacs
"The Excluded Americans: Homeless-
ness and Housing Policy, " by William
Tucker, Regnery Gateway, 1990,
$24.95, hardcover.
W
illiam Tucker is best known
for offering a $50 bounty to
anyone who gave him infor-
mation (address, apartment
size and monthly rent) about wealthy
New Yorkers living in rent-regulated
apartments. This venture was part of
the real estate industry's effort to
portray rent regulation as protecting
the rich more than the poor. Tucker
has published several op-ed pieces in
New York City newspapers in recent
years criticizing rent regulation and
lamenting the plight of immigrant
landlords with only one or two rental
properties caught in an ever-tighten-
ing web of red tape.
In "The Excluded Americans:
Homelessness and Housing Policies,"
Tucker pretends to be an innocent in
search of the causes of homeless ness.
But anyone familiar with Tucker's
work knows that he has long champi-
oned the viewpoint that rent
regulation is the cause. From its title
to its packaging-two homeless people
huddled in a doorway-and content,
The book plays down its libertarian
roots and often Flays fast and loose
with the facts 0 America's housing
crisis. Like the carefully crafted novels
of Ayn Rand, the politically unaware
are likely to be drawn in by the facile
charms of Tucker's arguments.
Right to Left
Surprisingly, "The Excluded
Americans" is more interesting and
complex than one would expect, given
the simplistic pro-landlord pieces
Tucker has previously written. Tucker
discusses zoning and property tax
policy, in addition to his usual stories
of vigilant landlords fighting evil rent
regulations and government bureau-
crats. As a libertarian, Tucker
sometimes moves so far right that he
begins to sound left. He attacks
exclusionary zoning as a major cause
of the housing shortage for lower
income families (fretting over the fail-
ures of the landmark Mount Laurel
decision to economically integrate
New Jersey towns) and tax assess-
ment policies that favor single-family
homeowners.
But Tucker's ideal world would be
one with no zoning or other regula-
tions whatsoever. Homes should be
sold and resold much like cars. A
wealthy individual buys a new Cadil-
lac and sells it a few years later, at a
lower price, to a middle income buyer.
A few years later the car is resold to a
low income buyer at a fraction of the
vehicle's original cost.
To Tucker, housing should be
completely open to the vagaries of the
market. While some of us may pri-
vately cheer the downfall of those
young professionals who foolishly
believed real estate prices could only
go up, there are plenty of working-
class people-including some of those
immigrants he champions-who do
not deserve to be caught in the mael-
strom of Tucker' s housing market free-
for-all.
Declining Data
When Tucker focuses on rent regu-
1ation' the quality of his arguments-
and his data-declines precipitously.
The linchpin of Tucker's argument
that rent regulation causes homeless-
ness is an analysis based on the federal
Department of Housing and Urban
Development's (HOD) controversial
1984 study of homelessness.
Tucker's analysis first appeared in
the National Review three years ago
and was analyzed in an Economic
Policy Institute paper. It revealed that
Tucker eliminated six cities from the
HUD study, added 15 cities of his own
choosing (using untraceable data) and
incorrectly cited Hartford, Connecti-
cut, as a city with rent controls. With-
out adding these carefully selected
cities, Tucker couldn't show a corre-
lation between rent controls and
homelessness. The paper also points
out that not only do just nine of the 50
cities in the study have rent controls
but that three of the top four cities in
homelessness per capita also lack rent
controls.
The HUD study itself was widely
criticized when it was released be-
cause of faulty research methods (HUD
researchers called local police depart-
ments and social service agencies and
asked for their estimate of the local
homeless population). Thus Tucker's
analysis and his primary argument
against rent regulation suffers from
GIGO-garbage in, garbage out.
There are other examples of Tucker
glossing over facts and ignoring real-
ity: For instance, his discussion of
why rents are higher at Stuyvesant
Town than at the neighboring Peter
Cooper Village development in Man-
hattan. According to Tucker, average
rents are higher at Stuyvesant Town
because "the more affluent tenants in
Peter Cooper Village have been more
skillful in taking advantage ofregula-
tions. Turnovers in The Village are
nine times lower than they are in
Stuyvesant Town. More affluent
people, because of greater foresight or
greater flexibility in their lives, seem
to be able to parlay rent regulations
into much lower rents."
Tucker offers no data to support
the contention that Peter Cooper resi-
dents are wealthier. But let's assume
they are. Residents of Peter Cooper
have air conditioning while
Stuyvesant residents don't because of
antiquated wiring. Perhaps New
York's blistering summers have some-
thing to do with why Stuyvesant Town
residents move more than
tenants in the neighboring develop-
ment. Thanks to large vacancy allow-
ances, each time a tenant moves the
rent increases propitiously. This has
nothing to do with the "flexibility" of
high income tenants.
At several points, Tucker simply
gets carried away with his effort to
equate rent regulation with evil. De-
scribing a conflict between a tenant
(Arbogast) and her landlord
(Levesque) in Oakland, California,
Tucker writes, "the Levesques went
bankrupt . . . Joseph Levesque suf-
fered a nervous breakdown. Three
months later, he broke into a hotel and
raped an anonymous woman. He told
prosecutors that he was taking re-
venge on Arbogast. In 1986 Levesque
was sentenced to eight years in
prison." Although the landlord's wily
defense attorney might have been
justified in attempting to explain away
his client's behavior as being caused
by rent regulation, for Tucker to ac-
cept it as plausible is obscene.
But Tucker never shies from the
outrageous. "Given free rein," he
writes, the housing industry could
easily construct enough housing to
give every American a decent home."
Not even Jack Kemp believes that. 0
Eric Weinstock is director of the
Housing Research Project of the
Community Training and Resource
Cente6.
PROFESSIONAL DIRECTORY
I
Barry K. Mallin
Attorney At Law
A decade of service representing
community development organizations
and low income cooperatives.
56 Thomas Street
New York, N.Y. 10013
Telephone 212/619-6800
DEBRA BECHTEL - Attorney
Concentrating in Real Estate & Non-Profit Law
Title and loan closings 0 All city housing programs
Mutual housing associations 0 Coopertive conversions
Advice to low income co-op boards of directors
100 Remsen Street, Brooklyn, NY 11201, (718) 624-6850
architectural/engineering ssrricllS for nonprofit developers
o Building Evaluation and Inspection
o Feasibility Studies 0 Construction Supervision
o Preliminary Design!Scope of Work Studies
o Complete Construction Drawings & Specifications
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458 BERGEN STREET, BROOKLYN, NY 11217 (718) 398-1440
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77 QUAKER RIDGE ROAD, SUITE 215
NEW ROCHELLE, NY 10804
914-633-5095 FAX-914-633-5097
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SMOLLENS and GURALNICK,
COUNSEUORS AT LAW
Specializing in representing tenants only in
landlord/tenant proceedings, cooperative
conversions, loft proceedings. We represent
sellers/buyers in house, condo and co-op closings.
15 Maiden Lane, Suite 1800
New York, NY 10038
2121406-3320
ARCHITECTURAL & PLANNING DIVISION
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Specialists In Nonprofit Housing
and Community Facilities
FULL ARCHITECTURAL SERVICES
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Contact Betsy Calhoun or Paul Castrucci, RA 212/226-4119
40 Prince Street, New York, NY 10012
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3190 Riverdale Ave. , Bronx, NY 601-2200
TURF COMPANIES
Building Management/Consultants
Specializing in management & development
services to low income housing cooperatives,
community organizations and co-op
boards of directors
329 Flatbush Avenue
Brooklyn, N.Y. 11217
Rebecca Reich
718/857 -0468
WORKSHOP
STAFF ,noun. The East Side SRO Legal Services Project seeks
full-time staff attorney to represent individuals & tenant groups
living in SRO hotels and rooming houses. Responsibilities: individ-
ual & group representation in court, at administrative hearings, &
participation in community outreach education programs. Re-
quirements: minimum of 1 yr expo Salary: pursuant to collective
bargaining agreement, depending on yr of law school graduation.
Resume: Olive Karen Stamm, Esq, Managing Attorney, MFY
Legal Services, Inc, 223 Grand Street, NYC 10013. Women,
minorities & handicapped encouraged to apply.
TEIWIT DMAlIZER. The East Side SRO Legal Services Project,
which represents tenants in SRO hotels & rooming houses, seeks
tenant organizer. Responsibilities: extensive field work, advise
tenants of their rights, assist them in housing court & before city &
state agencies, help to develop tenant assocs, conduct training
sessions on SRO housing issues. Requirements: must be asser-
tive, exp in tenant or community organizing, & able to deal
effectively wI all types of people, knowledgeable about housing
laws & regs as well as housing court procedures. Salary: pursuant
to collective bargaining agreement. Resume: Olive Karen Stamm,
Esq, Managing Attorney, MFY Legal Services, 223 Grand Street,
NYC, 10013. (212) 966-7410.
Your job ad here. Just $40 for 50 words.
Call (212) 925-9820.
r-----------------,
GUTSY. INCISIVE.
PROVOCATIVE.
Life inside a city-owned crack den ... public agencies
cutting deals for private developers ... landlords who
collect the rent and let their buildings rot. Each
month, CITY LIIIIT8 probes the misguided public
poliCies and inefficient bureaucracies besetting New
York. But we don't think it's good enough just to
highlight the muck. CITYL1111T8 looks for answers.
We uncover the stories of activists and local organ-
izers fighting to save their neighborhoods. That' s
why CrrYL1111T8 recently won two maJor journal-
ism awards. Isn't it time you subscribed?
YESl Start my subscription to CITY 1aIIIlT8.
o $15/one year (10 issues) 0 $25/two years
Business/Government/Libraries
o $35/one year 0 $50/two years
o Payment enclosed. Add one issue to
my subscription-freel
Nwne ________________________________ __
Address ______________________________ ___
City ______________ State _______ Zip __
ClTYIaIIIlT8, 40 Prince Street, New York, NY. 10012
L _________________
" you're a not-lor-profit group
sIIou'''n't you IJanle wi'"
a IJanle?
Now, no-fee banking for not-for-profit groups.
How you can save. As a bank and neighbor
we'd like to help you save more so there'll be
more for the people and purposes you serve.
So, unless you maintain an exceptionally high-
activity, low balance account, you'll pay no
monthly maintenance or business fees and no
charges per check paid or deposited. No
mark-ups on checkbooks, regardless of your
activity level or balance.
We cut the fees, not the service. Our
bankers are well known for their community
involvement. They know the financial needs of
not-for-profit groups - planning, budgeting,
cost controls, fund raising - and how to
allocate assets for optimum return. They're
always there when you need them.
Free booklet. Ask to see what we've done
and are doing for groups like yours. For the
bank branch nearest you and a free copy of a
descriptive booklet call 212-221-6056 in New
York City. Or 1-800-522-5214 outside NYC.
REPUBLIC
NATIONAL BANK
OF NEW YORK
MANHATIAN WILLIAMSBURGH
SAVINGS BANK
Republic National Bank and The Manhattan Savings Bank are subsidiaries of Republic New YorI< Corporation NP 206
Member FDIC
Neighborhood Environmental
Action Awards Program
(NEAAP)
Cashgrants for lowincome communities
to tackle toughurban environmental problems
The Citizens Committee for New York City will award grants ranging from $1000
to $5000 to volunteer-based groups in low income areas to support their struggle
for a healthy environment.
NEAAP grants will support initiatives that address:
air quality
solid waste
energy
noise
water quality
land use/open spaee
indoor environmental hazards
(lead poisoning, asbestos)
toxies
For further information or for an application call
Tamyra Gantt at the Neighborhood Resources Department at (212) 684-6767.
The deadline for completed applications is February 1, 1991.
NEAAP is supported by the Mary Flagler Cary Charitable Trust.
CITIZENS
COMMITTEE FOR NEW YORK CITY, INC.
3 West 29th Street. New York, New York 10001-4501
r

City Limits Magazine, January 1991 Issue

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City Limits Magazine, January 1991 Issue

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January 1991 New York's Community Affairs News Magazine $2.

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