I hope you are taking time to celebrate summer in our glorious neighborhood. As the Acting Chair of the Battery Park City Authority’s Board — and resident of this community for going on 40 years — I wanted to update you on three key initiatives, specifically our efforts to protect our community from more frequent and more severe coastal storms, our responsibilities managing the Authority’s finances, and our duties administering the Authority’s ground leases. Though not new, these issues are complex — and as residents you should be armed with accurate information about the management of the community we all call home.
Protecting Our Neighborhood – Resiliency Plans
The Authority has pursued a deliberate and collaborative approach in developing key projects to protect our neighborhood, just as urban coastal communities around the world are confronting similar challenges. Though it is certainly sad that some of our public spaces will need to close for construction in the months and years ahead, those temporary closures will enable us to protect and enhance that which we value so dearly — our parks, public spaces, homes, and personal safety. The science is clear that storms are becoming more severe and more frequent, and we need to act accordingly. Simply put, these projects couldn’t be more urgent. I encourage you all to stay tuned for additional outreach from the Authority as construction on the South Battery Park City Resiliency Project commences in the months ahead, and to join in the planning for the North/West Battery Park City Resiliency Project as the team begins that project’s designs.
Our Stewardship of Public Funds
Battery Park City is unique in that we use the New York City real estate taxes we collect (known as PILOT), as well as ground rent, for the benefit of our community before transferring the residual of those real estate taxes to the City. In general, of the $326 million collected, about half comes from commercial properties and half from residential properties; 80% comes from PILOT and 15% from ground rent — the private rental of a public asset. Over $105 million — nearly one-third of what’s collected — stays in BPC and pays for the operations, maintenance, and capital expenses on our 92 acres. The Public Benefit Corporation model that provides for the Authority to use tax and ground rent payments is precisely why the commercial and residential owners and tenants enjoy world class parks and public spaces, and are the beneficiaries of the Authority’s ability to fund capital programs like these resiliency projects, which will protect our homes, businesses, schools, and cultural institutions, as well as Lower Manhattan overall. I don’t know any other homeowners who can say that they know precisely how their hard-earned real estate payments are used. We should be proud and relieved that we benefit as we do.
Residential Affordability and Our Management of Ground Leases
For certain, all New Yorkers would like their rent reduced. However, the Authority’s Board members must actively manage the Authority’s ground leases, including those of our 18 condominium buildings. As fiduciaries of the 92-acre Battery Park City property — a valuable public asset — we must ensure that, pursuant to the leases, we collect the critical funds for our operations and capital projects and important City services, including affordable housing development across the city. At the same time, we have worked in good faith for many years to provide economic stability to homeowners through a predictable ground rent schedule reaching far into the future, and to reduce disparities in ground rent per square foot across BPC’s buildings over time. In 2011 and 2012 we renegotiated ground leases for 12 of the 18 condominium buildings, and we have worked with or are working with the remaining six buildings as their contractual ground rent resets approach.
While BPCA continues to engage with individual buildings in pursuit of our objectives, we are also pursuing a program whereby ground rent increases would be deferred for certain residents with a demonstrated financial need. BPCA believes it is fiscally irresponsible to agree to below market ground rent increases otherwise, particularly for some of the most high-end real estate in New York City. However, we recognize that not all resident homeowners can easily pay increased living expenses, and we aim to finalize this program in the months ahead.
On a Personal Note
I have lived and worked in our community since 1983. I lived at Gateway Plaza as a pioneer in the neighborhood for six years and moved down the street in 1989 when I was married. My husband and I raised our two daughters here. After September 11, I became active in the community. I ran the Battery Park City Parents Association, eventually co-chairing the Neighborhood Association with Rosalie Joseph. Together with Anthony Notaro, we organized the first Block Party, and Bob Townley of Manhattan Youth helped us to set up a fun and free children’s area for a number of years. My husband and I arranged a forgivable loan for the Battery Park City Day Nursery so that it could survive reduced enrollment during the rebuilding period of the neighborhood. Halloween lists, parades, holiday parties as well as advocacy for parks, schools, and community centers were all important to us. I count my neighbors among my dearest friends.
I am a proud member of this community and remain proud to volunteer on the BPCA board. My fellow board members include two other local residents and three seasoned business leaders with experience that helps guide the Authority. Working with many of you, we have helped make this community into the thriving success story it is today. Our work continues.
Martha Gallo, Acting Chair, Battery Park City Authority Board