Disparity Begins at Home

Community Board 1 (CB1) is exploring the possibility of using surplus funds from the Battery Park City Authority (BPCA) to fund resiliency infrastructure throughout Lower Manhattan. At the January 18 meeting of CB1’s Waterfront, Parks, and Resiliency Committee, chairman Paul Goldstein began the discussion by noting that, “resiliency is an issue that we need to address in CB1. There isn’t much contention about that. On the other hand, it has surely proven to be, since Hurricane Sandy, a very difficult undertaking.”

“We all know that there are parts of CB1 that are being addressed,” he added. “The BPCA is devoting funds to examine their properties and come up with plans. We also have parts to the north, on the East Side, where Montgomery Street up to the East 30s, is receiving federal funds, to the tune of several hundred million dollars, to do resiliency work in that area. What that leaves is the vast majority of CB1 with no plans and no prospects at the moment for resiliency.”

CB1 is a collection of neighborhoods — usually thought of as Battery Park City, Tribeca, the Financial District, Tribeca, the South Street Seaport, and the Civic Center — encompassing 1.5 square miles, bounded roughly by Canal, Baxter, and Pearl Streets and the Brooklyn Bridge. Within these borders, only Battery Park City (a community separately governed by the BPCA, which has its own, dedicated stream of revenue) currently benefits from both a plan and funding to create infrastructure designed to protect against the rising sea levels and future extreme weather events associated with climate change. (The area along the East River waterfront that Mr. Goldstein referred to, from Montgomery to the East 30, lies outside of CB1.)

 Paul Goldstein: "One thing that is clear is the BPCA does produce enough income that they have a large surplus. What I am suggesting is that we explore looking at those excess funds. Our job is to try to get this money for our community."


Paul Goldstein: “One thing that is clear is the BPCA does produce enough income that they have a large surplus. What I am suggesting is that we explore looking at those excess funds. Our job is to try to get this money for our community.”

“There was a time down here when we had some other sources of funding, which we utilized to pay for major capital projects,” Mr. Goldstein continued. “For example, the Lower Manhattan Development Corporation” — an agency created with federal money to aid Downtown’s reconstruction in the wake of the terrorist attacks of September 11, 2001 — “had $2 billion. While the attack on the World Trade Center was obviously a horrendous tragedy, it also did create a large fund that was used for a lot of important projects: new schools, new libraries, and a lot of other programs throughout the area that it supported. But that money is gone.”

“So we need to find other sources of funding for this,” he added. “I am not suggesting that Battery Park City is going to have the money to pay for all the needs of CB1. But one thing that is clear is the BPCA does produce enough income that they have a large surplus.” This was a reference to the fact that the Authority collects more than $200 million each year in ground rents, payments in lieu of taxes, and other fees from residents and business located within the community. After the Authority’s operating expenses (which come to around 15 percent of its overall revenue) are deducted, a surplus of more than $150 million remains. The bulk of this amount is remitted to the City of New York, under an agreement with New York State, which controls the BPCA.

Mr. Goldstein cautioned that, “I’m not talking about the funds that are needed to maintain and support the operations of Battery Park City. Let me be very clear about that. Those should not be interfered with. Obviously, people live there, and pay that money, as do the corporations, and they deserve their services as they’ve always had them. What I’m talking about is the surplus funding, which is largely turned over to the City of New York. A lot of it is used for affordable housing, at least it is supposed to be. There have also been times, when many other entities in State government saw that money and said ‘oh, let’s get our hands on that,’ because that’s where the money is. This is a public authority that raises a lot of money.”

“What I am therefore suggesting is that we explore looking at those excess funds,” he observed. “And the BPCA does use some of those funds to pay for things outside of Battery Park City. Battery Park City supports some of the redevelopment of Pier A. And the shuttle bus that the Downtown Alliance runs gets a subsidy. The point is that this is not an unprecedented ask.”

“In light of the situation where we have a dire problem, raising and identifying funds,” he concluded, “I’m not saying that this is the answer. This would probably generate, maybe, a few million dollars a year. But any amount of money is something. So that is what I’m throwing out on the table for discussion.”

 Justine Cuccia: "It's not clear that we're going to be able to have the conversation that the community needs and wants to have, if there's another claim on that money. That would be putting a lot of responsibility on the shoulders of people who live in Battery Park City. And this is a slippery slope."


Justine Cuccia: “It’s not clear that we’re going to be able to have the conversation that the community needs and wants to have, if there’s another claim on that money. That would be putting a lot of responsibility on the shoulders of people who live in Battery Park City. And this is a slippery slope.”

Justine Cuccia, who is not a member of CB1’s Waterfront, Parks, and Resiliency Committee, but does serve as co-chair of its Battery Park City Committee, attended the January 18 meeting because of the community’s interest in any potential claim on BPCA funds. She acknowledged that, “the Authority does have a large surplus, and that money is supposed to be earmarked for affordable housing elsewhere in New York City. But what sometimes ends up happening is that it gets stuck into fund that the City spends as it wishes.”

“But a concern about this idea,” she continued, “is that one of the issues the Battery Park City Committee wants to address is financial sustainability, in the sense of affordability. So yes, there’s $170 million in surplus BPCA funds. But part of the issue in Battery Park City is that the infrastructure within the community is coming apart. Buildings themselves cannot afford to pay for their own upkeep — their boilers are going out and the roofs need repair.”

“What residents are frustrated with is that the people who live there, the buildings they live in, don’t have enough money to keep going. So looking at new claims on that pot of $170 million, even for something like resiliency, is a concern.”

She added, “not that resiliency isn’t a worthy cause — it is. But the affordability of Battery Park City and the fact that the Authority has talked about issuing more bonds to pay for resiliency just within Battery Park City itself, these are problems. What all of that will lead to is increases in ground rent, which will make the neighborhood even less affordable. And it’s already unaffordable now for many of the people who live there, who are being priced out. So the concern is that the conversation shouldn’t be about how to spend all this money. The conversation should be: let’s use part of that money to keep housing affordable in Battery Park City, by reducing the ground rent, or at least stopping it from increasing.”

Mr. Goldstein asked, “but do you think all $170 million would be needed for those needs?”

Ms. Cuccia replied, “no, but it’s not clear that we’re going to be able to have the conversation that the community needs and wants to have, if there’s another claim on that money.” She also observed, “maybe an answer is that the BPCA’s resiliency plans should be expanded and shared with surrounding communities. And if there’s a cost associated with sharing or expanding those plans, maybe the BPCA should be in charge of formulating the plan for the rest of Lower Manhattan. But don’t look to the BPCA to fund the project for all of Lower Manhattan. That would be putting a lot of responsibility on the shoulders of people who live in Battery Park City. And this is a slippery slope.”

She added that, “the BPCA should be lauded for the great job that they’ve done with resiliency so far. The work that they have done is head and shoulders above, and far beyond, what the City and State have done. They have got so much more information, research, and an actual plan, which is amazing.”

“But,” she noted, “even for the Authority to fund resiliency within Battery Park City is infuriating. It’s doubly unfair — it’s not fair to surrounding communities, like FiDi and Tribeca, which aren’t protected. But it’s also not fair for Battery Park City residents to have to pay for it themselves.” This was a reference to the fact that other communities where resiliency infrastructure plans are under way, such as the East River Waterfront or the Rockaways, are receiving that benefit as part of what government provides from its general revenue, at no additional cost to people who live there. For residents of Battery Park City, the same tax levies are funding resiliency measures elsewhere, but providing no local benefit. Instead, the Authority will issue new bond debt to fund resiliency infrastructure within the community, which will eventually be redeemed from ground rent revenue paid by residents and businesses in the community in years to come. In this context, Battery Park City residents appear poised to pay twice for whatever resiliency measures are eventually implemented in their neighborhood.

Bob Townley: "The only way we're going to get resiliency is through a public agency, like the Battery Park City Authority or the Port Authority, and coming up with some money. This is worth exploring. I think there's value in having the BPCA be a lead agency to close the gaps. Somebody has to do this."

Bob Townley: “The only way we’re going to get resiliency is through a public agency, like the Battery Park City Authority or the Port Authority, and coming up with some money. This is worth exploring. I think there’s value in having the BPCA be a lead agency to close the gaps. Somebody has to do this.”

CB1 member Bob Townley asked, “what is the price of the resiliency project within Battery Park City?”

BPCA spokesman Nick Sbordone replied, “there are a number of component pieces — some of which have been done, some of which are on tap. The Pier A rehabilitation is complete. The ball fields and streetlights were redone. The community center at Asphalt Green was completed.”

Looking ahead, he noted, “we’ve put out a request for proposals [RFP] for ball fields resiliency, which will be a wall to hold back any water that came down the West Side Highway. And we have another RFP in the works for northern Battery Park City, which contemplates making sure that Battery Park City is protected, but not to the detriment of other areas. At the northern end, we anticipate going around the back of Stuyvesant High School, crossing the West Side Highway, and meeting a high point further inland, so that if water came down, it would basically be compartmentalized. At the southern end, around Wagner Park, we anticipate a continuous flood barrier that would run from the Museum of Jewish Heritage, down around Pier A, and across to State Street, where there’s a highpoint.”

“The price tag is still to be determined,” he said. “But we’re talking about, conservatively, tens of millions of dollars over the course of the coming years.”

BPCA spokesman Nick Sbordone

BPCA spokesman Nick Sbordone

Mr. Townley replied, “the only way we’re going to get resiliency is through a public agency, like the Battery Park City Authority or the Port Authority, and coming up with some money. This is worth exploring. I think there’s value in having the BPCA be a lead agency to close the gaps. Somebody has to do this.”

Mr. Goldstein added, “maybe it takes the form of using the BPCA’s consultants to expand the plan beyond Battery Park City, to a holistic plan.”

Tom Berton: “That raises a question about the role of this community board. Do we get to advocate, in a forward-looking way, rather than being reactive?”

CB1 member Tom Berton asked, “what would the process look like? Do we go to the elected officials to change the charter for the BPCA?”

Tom Berton: "That raises a question about the role of this community board. Do we get to advocate, in a forward-looking way, rather than being reactive?"

Tom Berton: “That raises a question about the role of this community board. Do we get to advocate, in a forward-looking way, rather than being reactive?”

Mr. Goldstein averred, “yes, you would need to revise their operating process.”

CB1 member Laura Starr said, “the Downtown Alliance and the business community should be involved, too. All of these constituencies need to come together to push for an integrated plan. And I like the idea of the community taking charge of it.”

Tom Berton: “That raises a question about the role of this community board. Do we get to advocate, in a forward-looking way, rather than being reactive?”
Mr. Goldstein reflected that, “maybe, if the Democrats retake the Senate, we can go to Charles Schumer and Kirsten Gillibrand and get an infrastructure plan. But today, you know that’s not going to happen. So our job is to try to get this money for our community.”

He closed the discussion by asking, “is there a consensus to explore this further?” His question was answered by a chorus of affirmatives from around the table.

Afterward, Mr. Sbordone said on behalf of the BPCA, “while we’re proud to have developed a resiliency plan that’s been well-received by the larger Downtown community, our top priority is protecting Battery Park City from the challenges of storm surge and sea level rise. And to be clear: Any bonds issued to finance capital projects such as these are separate and distinct from negotiated ground rents, which are solely a function of lease terms. Battery Park City has some of the newest and best-designed buildings in New York, in the best neighborhood in New York — so should any resident be concerned about the upkeep of his/her building, please contact the building management outlining these problems in as much detail as possible, and copy BPCA on that letter. We want to hear from you.”

(Editor’s Note: Ms. Cuccia is related to the reporter who wrote this story.)

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