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February 28, 2007
ESDC-released documents from Forest City lack vital information
Atlantic Yards Report explains that the documents released today leave a lot out, concluding that, "The same lack of transparency apparently persists."
The Empire State Development Corporation released three pages of Forest City Ratner-prepared documents estimating investment returns over 12 years.
I'll have more analysis later, but it's important to remember that these pages differ greatly from the financing plan that the Metropolitan Transportation Authority required from bidders for the Vanderbilt Yard, and which Develop Don't Destroy Brooklyn and other organizations tried in vain to see.
Firstly, that financial plan covered 20 years, not little more than a decade. Secondly, the MTA required (p. 15, or PDF p. 18) the developer to account for "sources and uses"--in other words, the combination of subsidies, investment funds, and internal funds that would be used.
Posted by lumi at 11:21 PM
BREAKING NEWS: Actual results may vary
We can't decide who has the more highly developed sense of humor, Norman Oder or Bruce Ratner.
Today, "The Mad O" noticed this disclaimer on the Atlantic Yards Combined Returns Summary (link).
Which leads us to wonder, when do actual results NOT vary?
Bruce Ratner's flagship project, Metrotech, wasn't supposed to be a campus for NYC bureaucrats, and the original plans for the Atlantic Center never envisioned the Department of Motor Vehicles as the anchor tenant.
Heck, even Frank Gehry's concert hall in Springfield, USA was repurposed into a prison.
"Ex-cellent!"
[Hey kids! Is that an "environmental compliance monitor" in the foreground of the Monty Burns Prison construction site?]
UPDATE: Norman Oder has been overkilling us on Thursday morning, pointing out that the DMV isn't "the" anchor tenant of the Atlantic Center Mall because it doesn't lease the greatest square footage. It's "an" anchor tenant. He's provided us with this link from Forest City Ratner's web site to prove his point.
We still contend that it is "the" metaphorical anchor tenant because it's the "store" that brings in the widest range of people who will shop in the other specialty stores.
Before the Mad O gets on our case, we should also explain that Frank Gehry never really built a project in Springfield. We don't even know where Springfield is. And that guy is probably just some guy, not an environmental compliance monitor.
What would we do without the Mad O to keep everyone honest? But it's ok, having to explain one's joke in detail usually makes people think it's funnier, right?
Posted by lumi at 10:54 PM
Nets for sale? Document suggests cash flow stops in 2013
Atlantic Yards Report
Norman Oder comes up with a possible explanation for why Ratner's financial projections, released today, only run until 2013 for the NJ Nets.
Could the Nets be for sale after the Atlantic Yards project is under way? There's certainly a hint of that in the Combined Returns Summary prepared by Forest City Ratner and released by the Empire State Development Corporation. The document estimates cash flow and investment internal rate of return starting in 2004 for both the "Team and Arena Investment" and also the "Real Estate Investment."
The "Team and Arena Investment" ends in 2013.
This wasn't the first hint either. Read on.
NoLandGrab: It would really suck if Ratner built the arena, sold the team and the new team owner threatened to move the team to Piscataway, unless the city built a newer state-of-the-artier arena.
Posted by lumi at 10:37 PM
FOREST CITY RATNER SPONSORS FREE NETS BASKETBALL CLINIC
Guests include former Net Darryl “Chocolate Thunder” Dawkins and New York State Assembly Member Vito Lopez
(Brooklyn, NY) – On February 21 st, Forest City Ratner Companies hosted a free Nets basketball clinic at the Ridgewood/Bushwick Youth Center in Brooklyn. Bruce Ratner, President and CEO of FCRC said, “Forest City is committed to supporting sports and athletics at all levels throughout Brooklyn. Nets basketball clinics emphasize the importance of teamwork, dedication and hard work – skills that are crucial for success – on and off the court.”
Darryl Dawkins, known for shattering backboards during his NBA days, helped coach the young athletes on the court but also gave them lessons on the importance of studying and working hard at school. New York State Assembly Member Vito Lopez, who represents Bushwick and other Brooklyn communities, also arrived to visit with players and coaches. Prizes and medals were given at the end of each session for a variety of team and individual achievements.
Participants were chosen from public and parochial schools (private schools did not attend because they were in session on the clinic date) as well as youth organizations and Amateur Athletic Union (AAU) Programs in Brooklyn. Today’s was the most recent installment in a series of FCRC-sponsored Nets basketball clinics for school-age children.
Posted by lumi at 10:35 PM
Financial documents
Three whole pages of financial documents were released by the Empire State Development Corporation today. The fact that only three pages cover a $4 billion project implies that more was left unsaid than revealed.
The analysis is still forthcoming, but there are some really interesting comments on Brownstoner, which got the documents up online first.
AY Financial Projections: We Got 'Em
Also posted earlier on Brownstoner, ESDC Forced to Cough Up Financial Docs on AY
Shahn Andersen, the savior/developer of Broken Angel, has been keeping up to date on the topic, posting expert commentary on Brownstoner.
Early this morning, Andersen provided a lesson on Development Financials 101:
Forget about the big number that they will make (I'd estimate it at around a billion dollars), what is their real return on investment when they have been given atleast $300 million dollars up front from various city and state agencies to do the deal? Even if they end up spending $50 or a $100 million of their own equity outside of financing, at the end of the day, they will make 1000% to 2000% ROI from what they actually invested.
Andersen's reaction to the documents released today:
Would anyone really go through all of this trouble for a measly 9.6 IRR?
Here are the documents:
Total Project Cash Flows
Combined Returns Summary
Nets Arena Cash Flows
Posted by lumi at 6:42 PM
Press Release: "Atlantic Yards" Financial Projections Fail to Shed Light on Forest City Ratner's Potential Profit
Figures Released By ESDC Under Threat of Legislators' Lawsuit Leave Many Questions Unanswered, Appear to Grossly Understate Profit
BROOKLYN, NY- Financial projections released today by the Empire State Development Corporation (ESDC) purporting to show Forest City Ratner's (FCRC) projected profit for the proposed "Atlantic Yards" project appear to raise more questions than they answer - and to severely understate the developer's profit.
The financial documents, which were released only after State Assemblyman Jim Brennan and State Senator Velmanette Montgomery sued the ESDC for the information, fail to provide sufficient details or underlying assumptions, including information on "sources and uses" typically provided for a project receiving significant amounts of public funding. In some cases, the documents omit information altogether, for example, assigning no projected value to the project's planned hotel. The true value of the assets, once built, would appear to be much higher than the values outlined; several elements of the plan appear to be estimated below market value, let alone future value.
At least one local real estate developer who has reviewed the documents had serious questions about the conclusions contained in the documents. Shahn Andersen, in comments posted to the web site Brownstoner.com, stated that he believed FCRC would earn approximately a billion dollars, and questioned how much money of its own the developer was actually putting up. He also questioned FCRC's purported rate of return as being severely understated.
The documents only project out eight years, to 2015, one year before the project's officially projected completion date. (In comparison, the MTA, in its Request for Proposals for the Vanderbilt rail yards, had required 20-year pro forma projections, although FCRC failed to provide the MTA with the requested information.) Some people with knowledge of the project, including "Atlantic Yards" landscape architect Laurie Olin, have said they expect construction to last 20 years.
The financial projections do reveal some interesting information about the arena, including the fact that the New Jersey Nets are currently losing some $40 million dollars a year. "It appears that the taxpayers are being asked to bail out a professional sports franchise that's currently a complete money loser," said Candace Carponter, spokesperson for Develop Don't Destroy Brooklyn. "While the city and state are bending over backwards to subsidize Bruce Ratner, it seems that it should be the other way around."
According to the documents, the act of relocating the Nets from New Jersey into an arena in Brooklyn will allow Ratner and the Nets' co-owners to essentially double their initial investment by 2013, providing the money-losing team's investors with a publicly subsidized golden parachute.
It's also unclear as to whether the ESDC has analyzed and verified the projections released today, or if they simply rubberstamped this submission, just as they have every other aspect of the "Atlantic Yards" project. Given the vast public subsidies that this project is slated to receive, the public has the right to expect some assurance from the government that the developer's numbers are comprehensive and based upon valid business assumptions," said DDDB's Carponter. "The footnote on these documents says 'For discussion purposes only - actual results may vary.'"
Posted by lumi at 6:40 PM
Skybox muscle slips for stadiums
Suites that aren't paying off get boot
Wall St. Journal, via Myrtle Beach Sun
By Russell Adams
On the eve of the release of financial projections for Bruce Ratner's Atlantic Yards plan, this article revealed that skybox revenue ain't what it used to be.
It was like watching an era of sports history being erased. In early December, construction workers sawed through the multiple layers of drywall and metal studs separating a row of skyboxes at the Seattle Mariners' Safeco Field. They tore up the suites' beech-hardwood floors and carted away their oriental rugs and leather furniture. By the end of the week, the eight skyboxes were gone.
In a reversal that strikes at a cornerstone of pro-sports finances - and of the way corporate America entertains - teams around the country are ripping out luxury suites. These perches have been used to justify billions of dollars in stadium construction over the past two decades. But in many cities, they are losing luster with surprising speed, partly the result of factors that couldn't have been predicted five or 10 years ago, from changes in tax laws to scandal-driven reforms on corporate entertaining.
NoLandGrab: In contrast to this article and current nationwide trends, Ratner estimates, in the documents released today by the ESDC, that "suite and loge box revenue" will nearly pay for the arena's construction.
Posted by lumi at 6:26 PM
Links to demolition permits status in CB8, 6 and 2
Yesterday, BrooklynSpeaks.net posted two links for the status of all pending demolition permits in Brooklyn Community Boards 8 and 6.
Here's the link for CB 2, which contains the one property, 179 Flatbush Ave., for which the application has been approved.
Posted by lumi at 9:35 AM
A dozen planned demolitions would create "facts on the ground," isolate plaintiffs
Atlantic Yards Report
With the filing of papers preliminary to the demolition of 12 properties it owns within the Atlantic Yards footprint, developer Forest City Ratner--even as a pending eminent domain case constrains it from construction work on the planned arena--seems poised to create "facts on the ground," empty lots that would foster both a perception of isolation and a sense of the project's inevitability.
[Click map to enlarge.]
The demolitions would include the Ward Bakery on Pacific Street, which preservationists have hoped to see saved for adaptive reuse, but instead would be razed for an interim surface parking lot.
Among those most starkly impacted would be the residents still within the 22-acre footprint.
...
While a 2/20/07 Forest City Ratner press release announced the beginning of site preparation work and the commencement of demolition of one building, 179 Flatbush Avenue, papers filed by the developer with the Department of Buildings (DOB), mainly in the past week, indicate much greater ambitions. The demolitions have not yet been approved by the DOB.
Posted by lumi at 8:47 AM
As ESDC waits to name AY environmental monitor, Dean Street residents lose water supply, face FCR obfuscation
Atlantic Yards Report
Norman Oder publishes the scoop on yesterday's events in and around the Atlantic Yards footprint, by way of an eye-witness account from the President of the Dean Street Block Association, Peter Krashes.
Krashes spent the greater part of the day dealing with a mishap caused by a Forest City Ratner (FCR) contractor. The Dean St. resident remained unstymied by the bald-faced assertion put forth by FCR's VP of Public Affairs, who claimed that an existing problem was spotted by the Department of Environmental Protection thanks to the work being done by Forest City Ratner.
On February 5, the Empire State Development Corporation (ESDC) issued a request for proposals for an environmental monitor to oversee construction activities within the Atlantic Yards project. Responses were due February 26, with selection expected in two weeks.
However, for residents of Dean Street between Carlton and Vanderbilt avenues—a block that on the south side borders the project footprint and on the north side is within the footprint—that oversight seems already overdue.
On Tuesday, they lost their water supply for four hours owing to a worker’s error, and found the inconvenience compounded by a lack of information available from Forest City Ratner’s newly-established Atlantic Yards Community Liaison Office. The likelihood of at least a dozen building demolitions within the next few months makes the issue even more pressing.
Posted by lumi at 8:26 AM
Lawmakers Push for the Release of Atlantic Yards Financial Documents
The NY Sun
By Eliot Brown
A lawsuit filed by two Brooklyn legislators is forcing the public release of long-awaited documents regarding finances surrounding the Atlantic Yards project.
An ESDC spokeswoman told The New York Sun it now intends to release the documents to Mr. Brennan, likely this week, which include development company Forest City Ratner's business plan for the $4.2 billion project in Brooklyn. Assemblyman James Brennan, joined by state Senator Velmanette Montgomery, filed a lawsuit Monday against the Empire State Development Corporation alleging that the agency was improperly withholding documents detailing the project's finances.
Critics of the project for at least two years have been attempting to determine the amount developer Bruce Ratner stands to profit, and they say the hundreds of millions in city and state subsidies should justify its status as public information.
...
"Ratner's basic premise for having to build this so large and so dense was that it has to be to make this financially feasible," a spokeswoman for the advocacy group Develop Don't Destroy Brooklyn, Candace Carponter, said. Without knowing Mr. Ratner's potential profit, the public has been unable to properly evaluate his claims, Ms. Carponter said.
...
A spokeswoman for Forest City Ratner said the company had no comment regarding the lawsuit, and has complied with government agencies in the public approval process.
Posted by lumi at 7:59 AM
After Brennan's lawsuit, ESDC poised to release Ratner’s profit projections
Atlantic Yards Report
Brooklyn Assemblyman Jim Brennan, joined by State Senator Velmanette Montgomery, has gone to court in an attempt to force the Empire State Development Corporation (ESDC) to answer his Freedom of Information Law (FOIL) request to see the projected costs, revenues, and profits for Forest City Ratner’s Atlantic Yards plan--a prelude to arguing for a reduction in the project’s size.
While Brennan's effort had been rejected by the ESDC under the administration of Gov. George Pataki, the New York Sun reports today that new Gov. Eliot Spitzer's administration has indicated that it's willing to comply--and the documents should be released shortly.
...
[Brennan] said last October, “So that is a critical public question: how much money do they think they’re going to make on their market-rate housing, and how much money do they think the arena is going to make? How much money does the affordable housing need and where are they going to get it? Without that information, the public is shortchanged.”
NoLandGrab: Brennan makes good points on two fronts:
1. It is important to know how much taxpayer money will be committed to Atlantic Yards and what the taxpayers will get in return. For example, the public has a right to know if Atlantic Yards affordable housing might end up costing more than other affordable housing solutions.
2. It is important to understand how much Bruce Ratner stands to make. Ratner is not only asking for the public to sacrifice taxpayer money for Atlantic Yards, but also to put up with the densest residential housing community in the nation. If the density issue is driven by the need for the developer to make a profit, then the public has a right to know what Ratner will earn in exchange for the public's acquiescence to an urban planning experiment of historical proportions.
Posted by lumi at 7:51 AM
NO-PARK SLOPE
1 HOUR TO FIND SPOT IN B'KLYN NABE
NY Post
By Rich Calder
You think traffic will be bad if Atlantic Yards gets built. What about now?
Nearly half the cars clogging Park Slope's streets at any given time are going nowhere - except in quest of a parking spot, a new study shows.
And drivers spend an average of half an hour to an hour trying to find a spot on the Brooklyn neighborhood's brownstone-lined streets, according to the advocacy group Transportation Alternatives, which conducted the study.
...
Councilman David Yassky (D-Brooklyn) cautioned that parking in Park Slope will only get worse once the $4 billion Atlantic Yards project - which includes an NBA arena and 16 skyscrapers - is built between 2009 and 2017 in neighboring Prospect Heights.
NoLandGrab: David Yassky can complain all he wants about traffic and Atlantic Yards — the historical 22-acre mega-project has been moving forward because of the failure of many key elected officials, like himself, to make any significant changes to the project, or to try to stop it.
The failure to implement a comprehensive traffic plan for Central Brooklyn not only haunts local residents, it also negatively impacts regional commercial transportation. Elected officials get credit for that as well.
Posted by lumi at 7:35 AM
Source: FCR plans to start demolition "within 6 weeks"
Atlantic Yards won't be the cause of significant construction-related impacts on the surrounding neighborhood. And if it did, the Atlantic Yards Community Liaison Office is there to assist you, right? Right??
Congratulations, you weren't born yesterday! And neither were residents of Dean St. who were stuck without water for several hours yesterday, gratis Caring Bruce.
BrooklynSpeaks.net is reporting that "A source told BrooklynSpeaks yesterday that Forest City Ratner plans to start demolitions on the Atlantic Yards site 'within 6 weeks.'"
One of the buildings slated to be demolished is the historic Ward Bakery building. Hopefully this third-stream coalition of neighborhood and civic groups will step up to the plate in a last-minute effort to save the historical building, now that the political process has yielded no results (except for Ratner).
Keeping a close eye on things, BrooklynSpeaks.net also reported the water service shut down to the neighborhood and noted:
At the same time, the Community Liaison Office has told residents that it is “too early” to release a schedule for work that is going to take place on the site.
Residents near and in the footprint are now being seriously impacted by impending demolition and construction, with no official coordinating public entity and the developer's Community Liaison Office so far inadequate.
The group warned that this Community Liaison Office stuff wasn't promising in a previous entry on the group's web site. A snarky comment follows:
More like the Convention & Visitors Bureau than 311.
Posted by lumi at 6:18 AM
THE EDUCATION OF YVETTE CLARKE PART 22: IS YVETTE THINKING LOGICALLY?
Hardbeat News commentator Arthur Piccolo has been spearheading a campaign to name a new Nets arena after Jackie Robinson. This week he's recapping the Brooklyn Papers coverage of Yvette Clarke's outrage over the naming-rights deal with Barclays Bank and is cautioning the freshman congressional representative from taking a position that might seriously undermine her credibility:
CongressWoman (sic) you cannot hold out the possibility of damaging Congressional Hearings that will explore possible wrong doing by a major worldwide corporation but choose not to do so if they will “donate” more money to Brooklyn whether or not you decide who gets the money.
...
Here is a good simple accurate definition of Extortion from Encyclopedia, “extortion is more widely defined to include the obtaining of money or property of another by inducing his consent through wrongful use of fear, force, or authority of office.” And from the Encyclopedia Britannica this definition, “ Unlawful exaction of money or property through intimidation or undue exercise of authority. It may include threats of physical harm, criminal prosecution, or public exposure.” And from Wikipedia “The simple four words "pay up or else" are sufficient to constitute the crime of extortion. These are third party definitions not the law itself but should give Yvette reason to pause before considering being involved in a “deal” with Barclay’s that includes Barclay’s altering its current naming rights offer.
Posted by lumi at 6:15 AM
February 27, 2007
NY Times to blame for what "Brownstoners" don't know about Atlantic Yards?
Commentary, from "Anonymice" on Brownstoner, regarding Jennifer Egan's Op-Ed in the Saturday Times, made us realize that Egan's piece was the very first mention in The NY Times that Atlantic Yards, if built, would be the densest residential community in the nation.
Two commenters posting on Brownstoner found that hard to believe; one even accused Egan of "creating 'facts' out of whole cloth."
This incredulity made us realize that unless these readers were receiving the DDDB newsletter, or were regular readers of NoLandGrab or Atlantic Yards Report, they had no clue. How could they? The New York Times never told them.
Here's how several voices in the public conversation on Atlantic Yards uncovered this amazing fact in the Summer of '06.
STARTS WITH STUCKEY
The questions about density arose when Forest City Ratner (FCR) VP Jim Stuckey was trying to make folks understand that Atlantic Yards wasn't all that big. In a May 15, 2006 interview with Brian Lehrer of WNYC, Stuckey claimed that the FAR (floor area ratio) of Atlantic Yards was around 8, and was close to that of the Downtown Brooklyn Plan.
FACTCHECKING STUCKEY
Stuckey's claims just didn't sound right to Jonathan Cohn from Brooklyn Views, who had been studying the plan and posting commentary from the point of view of an experienced architect. Cohn did a little analysis and calculated what he termed "real FAR" (as opposed to "FCR FAR?") and came up with an estimate more like 9 (see, "How Big Is It Now?"). Cohn also extended an offer to the 
developer to provide more accurate figures in order to nail down the actual figure — he's still waiting by the phone.
ODER UNVEILS STARTLING COMPARATIVE ANALYSIS
This revelation, and a quick lesson in the myriad of ways in which planners measure density, sent Norman Oder of Atlantic Yards Report sniffing around, comparing Atlantic Yards to other large-scale housing projects in New York City. Oder didn't find any developments in NYC that had nearly the population density of the Atlantic Yards plan (see, "Extreme density: Atlantic Yards plan would dwarf Battery Park City, other projects"). To the Brownstoner/NY Times readers, that includes Battery Park City. Imagine, BPC with, like, twice as many buildings sandwiched into the open space.
A CITY PLANNING EXPERT WEIGHS IN
Then former City Planning Commissioner and Develop Don't Destroy Brooklyn Advisory Board member Ron Shiffman pointed out Atlantic Yards's dirty little secret, "If Forest City Ratner’s proposal proceeds at the current scale, it would constitute the densest residential community in the United States and, perhaps, Europe, with the exception of some of the suburbs of Paris."
DENSEST RESIDENTIAL COMMUNITY? C'MON! SCHUERMAN LOOKS AT THE DATA
Oder's article and Ron Shiffman's pronouncement got New York Observer reporter Matthew Schuerman wondering if that could be true. Schuerman checked out the latest census data ("Prisoner of Atlantic Avenue") and found that the densest census tract in the nation is a single two-block project in West Harlem that has "229,713 inhabitants per square mile." Atlantic Yards, according to the figures released by the developer at the time, clocked in "between 436,363 and 523,636 inhabitants per square mile (based on estimated population of between 15,000 and 18,000 residents over 22 acres)."
Atlantic Yards has been shaved down since then, but the fact remains that it would handily eclipse the residential density of any place in the nation.
Why is residential density important? Because residential areas place a heavier load on city services. Those same city services that the Atlantic Yards Evironmental Impact Statement has amazingly concluded would not be significantly impacted by the project.
So thank you Jim Stuckey, Jonathan Cohn, Norman Oder, Ron Shiffman and Matthew Schuerman for putting your heads together and helping Brooklynites who read blogs written by what Senator Schumer calls "self-appointed people" to understand that Atlantic Yards is an experiment in urban density of historical proportions.
Oh, and thanks to Brownstoner readers for illustrating what happens to inquiring minds when the "Paper of Record" gets its info from developer press releases. We can only apologize for The NY Times for not keeping their readers in the loop, especially those who live in Central Brooklyn.
Posted by lumi at 10:00 AM
Lawyers claim AY wasn't Ratner's idea, but the record says otherwise
Atlantic Yards Report
Many decades from now, Brooklynites might be asking, "Just whose freakin' idea was this Atlantic Yards stuff anyway?"
Believe it or not, this is an important question for the eminent domain court case.
While U.S. Magistrate Judge Robert M. Levy last Friday recommended that the Atlantic Yards eminent domain case be dismissed from federal court, he acknowledged that the lawsuit "raises serious and difficult questions regarding the exercise of eminent domain under emerging Supreme Court jurisprudence."
So, the case will ultimately be heard on its merits, either in federal court (if the plaintiffs prevail on Judge Nicholas Garaufis to override Levy's recommendation) or in state court.
Then a judge will have to evaluate the curious claim, made by lawyers for Forest City Ratner in legal papers and in oral argument, that the developer did not initiate the Atlantic Yards project.
The developer Forest City Ratner (FCR) has been telling people for years that it was Marty's fault (actually, Marty has been bragging about it too). Norman Oder finds evidence to the contrary.
NoLandGrab: The most recent spin came from a newspaper in Utah, which wrote that Atlantic Yards was "the result of years of discussion on how to address New York's housing crisis, according to a spokesman for Forest City Ratner Companies." We wonder if this signals the latest story, one that might sound more compelling in court.
Posted by lumi at 8:58 AM
The Surface Parking Lots: Does "temporary" mean 20 years?
BrooklynSpeaks asks an important question.
Laurie Olin also suggested in his interview with the NY Observer that the project would probaly take as long as 20 years to complete, if it even is completed:
“It’s a great project, if it all happens,” he said. “The time calendar we are talking about is probably 20 years. People say 10 to 15, but take a look. How long does it take the market to absorb that much stuff?”
Does this mean that the 3 "temporary" surface parking lots (not to mention the uncovered railyards themselves) will also last that long? The largest of the temporary surface parking lots would be the entire block bounded by Pacific Street, Vanderbilt Avenue, Carlton Avenue and Dean Street
Posted by lumi at 8:50 AM
Schumer Announces $2 Billion For JFK Rail Link In President's FY08 Budget
We know that Senator Schumer probably doesn't read NoLandGrab, because as he put it, our views represent "the culture of inertia." However, someone might want to tell one of Bruce's biggest boosters that it looks like the coveted AirTrain ain't gonna happen if Bruce Ratner's Atlantic Yards plan goes forward (see, BrooklynViews, February 19, 2007, "Will Atlantic Yards Preclude the One Seat Ride to JFK?").
It seems that the highly touted "track improvements" — you know, the ones that the Metropolitan Transportation Authority claimed made Ratner's low-ball bid higher than Extell's — will preclude a direct rail link between Lower Manhattan and JFK. But that never stopped a politician from trying to get more money out of the Federal Government.
Not to put too fine a point on it, but at this moment, you probably know more about this setback for regional transportation than the folks in Washington and City Hall do.
Here's Schumer's press release from February 1, 2007:
U.S. Senator Charles E. Schumer announced today that next year's federal budget will include a $2 billion tax credit the Downtown JFK Rail link. Schumer, a member of the Senate Finance Committee, aggressively lobbied Administration officials to include the provision in the budget, expected to be released on February 5, 2007.
"This once-in-a-generation chance to connect Downtown to Kennedy Airport and Long Island will spur new business development, create jobs Downtown, and ensure New York's economic growth for decades to come," Schumer said. "Building a link between Kennedy Airport and the labor pool of Long Island will be especially important to businesses considering staying or moving to Downtown. When we finally get it done, it will be a big win for all of New York."
After 9/11, President Bush committed to providing New York with $20 billion in aid. As part of that original $20 billion commitment, Congress passed a $5 billion Liberty Zone tax incentive program in the "Job Creation and Worker Assistance Act of 2002." Unfortunately, some of the tax incentives have gone unutilized, and Schumer has sought for two years to convert those unused incentives into other projects that could benefit Lower Manhattan. President Bush included a $2 billion "trade-in" in his last two budget proposals, for fiscal years 2006 and 2007.
Last year, after months of working closely with the City and State, as well as Senate leaders, Senator Schumer succeeded in adding a $1.75 billion tax credit program (over 15 years) to tax bills that passed both the House and Senate. The credits were available to New York City and New York State to be used for public transportation infrastructure projects in or connecting with the New York Liberty Zone. However, at year's end, the provision was removed in conference and was not included in the final version of the tax extenders package that became law. Senator Schumer then lobbied the Administration to include the provision in its 2008 budget proposal so that it could pass both the House and Senate again and hopefully be signed into law this year.
The rail project is expected to cost $6 billion. The Port Authority of New York and New Jersey has already committed $560 million to the project and the MTA has $400 million in its capital plan for this project. Combined with these initial contributions, a redeployment of the available portions of the tax package for this project would represent a substantial amount toward the total required, and would give the momentum necessary to raise the remaining funds.
Posted by lumi at 6:45 AM
February 26, 2007
Brooklyn's Team-to-Be Hasn't Found Welcome Mat
The NY Times
By William C. Rhoden
Could this be some kind of record? Two days after running an op-ed criticizing the project, a NY Times sports columnist takes a hard look at the how a project that is supposed to unite Brooklynites behind one sports team, has remained controversial:
Three hours before the Nets were scheduled to play the Knicks in New Jersey yesterday, Rev. Clinton Miller sat in his office at the Brown Memorial Baptist Church in the Fort Greene section of Brooklyn.
Miller wanted to talk basketball, not Knicks-Nets basketball, but the business of basketball. Specifically, he wanted to talk about the Nets' move to Brooklyn for the 2009-10 season.
The Nets are coming to Brooklyn as part of the $4.2 billion Atlantic Yards development. The project, by Forest City Ratner, was unveiled in 2003. Forest City Ratner is also the development partner in building the Midtown Manhattan headquarters for The New York Times Company.
The revitalized Atlantic Yards would include residential and office towers and a basketball arena for the Nets. A substantial portion of subsidized housing will be for families at different income levels, but only about one-seventh of the project's roughly 6,000 units will be affordable for tenants making less than half the median income for the New York City area.
NoLandGrab: The veteran columnist falls into the same trap as other NY Times reporters, by referring to the "revitalized Atlantic Yards." Atlantic Yards is Bruce Ratner's name for the entire 22-acre development. The eight-acre rail yard is called Vanderbilt Yards.
Another correction worth noting: The Empire State Development Corporation and Forest City Ratner assert that the project will now cost $4B, not $4.2B.
Link (TimesSelect subscribers only)
Posted by lumi at 9:57 AM
Brooklyn Bridge + Atlantic Yards CBA = Black History Month?
Atlantic Yards Report
Norman Oder decodes the latest advertisement from Forest City Ratner, which offers a magnificent view of the Brooklyn Bridge, but, alas, none of the Atlantic Yards plan.
First, even though the Community Benefits Agreement (CBA) partners are significantly funded by the developer, and most have no history previous to this CBA, they get credit for honoring Black History Month as well.
And what history is being made? Seemingly the signing of the CBA in June 2005--and also the Brooklyn Bridge. However, the CBA has little to do with the bridge; while the document was signed nearby (on Old Fulton Street), it applies to a very different and oversize project.
...
What's Mayor Mike Bloomberg doing in that picture above? Yes, a mayoral press release claimed that he "signed" the CBA, but actually, he served as a "legally irrelevant witness," as noted by the Brooklyn Rail's Brian Carreira.
Forest City Ratner also tops the list of "Corporate Partners " for the NYS Association of Black and Puerto Rican Legislators' annual conference. That means that the developer paid the most money to share the spotlight with its "Community Benefits Agreement partners."
Posted by lumi at 9:24 AM
Dismissal eyed for federal suit against Atlantic Yards
MetroNY ran this short item in today's edition about Judge Levy's recommendation to kick the federal eminent domain suit down to state court:
Posted by lumi at 9:11 AM
A grudging Times correction on "city approval" and another taking more blame than Barclays
Atlantic Yards Report
Getting The NY Times to print a correction in reference to Atlantic Yards feels like pulling teeth, especially when they have printed the same correction in the past:
Why did it take six days for the New York Times to grudgingly correct a basic error in a 2/20/07 Metro Brief about Atlantic Yards, especially since the Times in December published essentially the same correction?
The brief stated:
The city and state approved the project despite heated opposition from residents...The correction today, under the For the Record rubric (where basic errors are corrected), states:
*A report in the Metro Briefing column on Tuesday about the construction work expected to begin at the Atlantic Yards project near downtown Brooklyn referred imprecisely to the development. Although it has been endorsed by the Bloomberg administration and the City Planning Commission, it is a state project that does not require formal city approval. (Emphasis added)That wasn't imprecise but simply incorrect.
Why did The Times take so long? What's the big deal anyway? What about the Barclays correction?
Perhaps The Times is getting sick of being fact-checked by Norman Oder.
"Correction fatigue," anyone?
Click here to get the rest of the story.
Posted by lumi at 8:51 AM
VC hints he'd like to stay
Bergen Record
By Al Iannazzone
Nets' guard Vince Carter has to decide whether or not to re-sign with the team next year. Carter's departure would exacerbate Ratner's PR woes with the current fan base:
...owner Bruce Ratner wants to keep Carter in a Nets uniform. After the backlash he received when Kenyon Martin left in 2004, Ratner could advise Thorn to give Carter what he wants.
Posted by lumi at 8:21 AM
Putting Limits On Pay To Play
Gotham Gazette
By Mike Muller and Joshua Brustein
Whether it's "outright bribery" or "subtle persuasion," "New York's public officials have long accepted money from those with whom their agencies do business, and such donations are often perfectly legal. But quid pro quos... are getting increased attention from public officials."
Caring Bruce is very creative; he turned over the job of payouts to the Brooklyn machine pols to his older brother, Michael:
"When you do business with the city, you get solicited by everyone from U.S. senators down to members of the City Council," said Atlantic Yards developer Bruce Ratner in former Public Advocate Mark Green's 2004 book on campaign finance, Selling Out. Reflecting on his past contributions and fund-raising efforts, Ratner added, "I didn't want to be a person on the outs, nor could my business afford to be a person on the outs given how much business we do with government."
Despite his qualms, Ratner still plays the game. As the Atlantic Yards Report, a blog opposed to his plan for downtown Brooklyn, writes, Ratner no longer makes campaign contributions – directly. But his brother and sister-in-law both contribute large amounts to public officials who may have sway over development projects he hopes to pursue.
NoLandGrab: Norman Oder will tell you until he's blue in the face, or you cry uncle, that just because he's a critic of many aspects of Bruce Ratner's plan and the lack of media coverage, that doesn't mean he's opposed to it.
Posted by lumi at 8:08 AM
February 25, 2007
Ratner propaganda--playing soon at a town near you
Save Our Land
A Developing Story - New York Times -- Note the propaganda techniques as the Ratner family tries to manipulate public opinion with the "foregone conclusion" hat trick. I think we've all had about enough of this, and it's time to start speaking the truth, all of us. This op-ed piece by Jennifer Egan, a novelist--an artist--who happens to live near the scene of the Atlantic Yards sellout, is articulate and points to many basic problems we in Cleveland have in common with Brooklyn. There are three salient points that play out over and over, like some sort of sick drill to take the town apart on the way to the bottom.First of all, as is once again exemplified by these embarrassing, tacky, and inconsiderate Ratners, the money's in the wrong hands, selfish hands. Second, the people we have running our governments and our nonprofits suck up to the people with money and sell out very, very cheaply, chump-style, but they keep their little jobs and aggrandize their little positions, as much as that's possible. Third, the public interests are subverted and the public winds up paying in many, many ways, as the developer confiscates the common wealth of generations and puts future generations under obligation.
We need to take our money back, along with our cities. We in Cleveland have seen all this before, as we swirl further down the drain, and now Ratner is sucking Brooklyn into the vortex as well--the earmarks are the same--the faddish Frank Gehry buildings, the promises of jobs and tax revenue and affordable housing, the sports arenas, the doctored impact statements commissioned by the developer. Read the entire article. You'll recognize the patterns of lies, deceit, sins of omission and commission, the corruption. Dwell on the last sentence. Blog. Congregate.
Posted by amy at 3:39 PM
A Look Back at the Atlantic Yards Groundbreaking
Brownstoner
Flickr photog AKinloch snapped this photo on Tuesday of the first day of demolition at the Atlantic Yards. We're going to stop by this weekend to check out the site for ourselves. Please send us pics if you do the same.
Posted by amy at 3:35 PM
Sunday Comix
Malcolm Armstrong
Posted by amy at 11:59 AM
On objectivity, neutrality, and integrity in covering AY
Atlantic Yards Report
Yesterday NoLandGrab was well respresented at the Grassroots Media Conference by our own Lumi Rolley. Norman Oder gave a great talk about objectivity, neutrality, and integrity in the media. (See examples of non-neutrality in today's Daily News articles, below.) Norman posted his remarks online.
Here's an example of some bad reporting. A little while ago, I discovered that the city had put $205 million in the budget for Atlantic Yards—that’s double the official pledge of $100 million.That wasn’t hidden; it was right there for everyone to see, it’s just that none of the reporters either remembered the pledge or thought there was news.
I wrote a story. DDDB put out a press release. The Post and the Sun wrote stories. The Daily News and the Times ignored it.
So, am I and the others who reported this story opponents or responsible journalists? And are those who ignored the story irresponsible journalists? And does that make them, in effect, proponents?
Posted by amy at 11:49 AM
Columbia launches land-grab plan
NY Daily News
DOUGLAS FEIDEN
That clash between town and gown is part of a land battle that has erupted over Manhattanville, a 17-acre industrial parcel near the Hudson River that's bigger than the site of the World Trade Center.Columbia wants to tear down most of the low-rise buildings, and relocate the low-income inhabitants and blue-collar workers. Over a 25-year period, it would build a gleaming $7 billion super-campus, creating 6.8 million square feet of space by 2030 to ensure its competitive future.
But the elite school isn't the only party worried about its future. Faced with the threat of forced evictions, eminent domain and the wrecking ball minority residents and employees in the thinly populated neighborhood are fighting back.
...
There are just two problems: Most of the 425 West Harlem residents, who live in 132 apartment units, don't want to move out. And many of the remaining business owners, who employ some 1,200 people, don't want to sell.So Columbia has asked the Empire State Development Corp. to consider condemning the properties it wants through eminent domain, a controversial practice in which the state takes private properties, at fair market price, ostensibly for a public purpose.
Lucky for West Harlem that Errol Louis is not on the Columbia beat...
Posted by amy at 11:41 AM
Errol Louis on AY negotiation, but not the 20-year affordable housing plan
Atlantic Yards Report
Today, let us give thanks that Norman Oder has the patience to fact check Errol Louis's entire article.
Louis calls the litigation "doomed" and likens Atlantic Yards to other projects with public benefits such as Lincoln Center in Manhattan and Melrose Commons in the Bronx, neither of which have, as the Atlantic Yards plan would have, nearly 2000 luxury condos, 2250 market-rate rentals, and 900 (of 2250 "affordable" rentals) at or over market rate.(In the print edition, there's a big picture of a smiling, benevolent Bruce Ratner.)
...
Louis calls it a "fool's errand" to go to federal court to impinge on state and local exercise of eminent domain. He notes Levy's citation that federal courts generally stay out of these cases. True, but the question here is whether the Atlantic Yards litigation, based on legal theories developed after the Supreme Court's 2005 Kelo vs. New London decision, will break new legal ground.
Posted by amy at 11:35 AM
Play ball with Bruce
NY Daily News
Errol Louis
The biggest myth about the $4 billion, 22-acre Atlantic Yards project in Brooklyn is that it might not get built. So it's long past time for people concerned about the complex to quit fantasizing about how to stop it and start focusing on ways to improve it.This was made clearer than ever two days ago, when federal Judge Robert Levy hammered another nail into the legal coffin of anti-project advocates by recommending dismissal of Goldstein vs. Pataki, a lawsuit by a handful of holdouts who refuse to sell their property to the project's developer, Bruce Ratner.
No, Errol, the biggest myth would be whatever you write. "U.S. Magistrate Judge Robert M. Levy concluded today in his Report and Recommendation on the Defendants’ Motion to Dismiss in “Goldstein et al v. Pataki et al” that he believed the case should better be heard in state court." Not dismissed.
Posted by amy at 11:27 AM
Youthful mogul sticks to his vision
Salt Lake Tribune
No, the youthful mogul in question here is not Bruce Ratner, but he's certainly on his way to becoming him:
So, he has purchased a franchise in the National Basketball Association's Developmental League. He will announce the team's name next month, and the season begins in the Utah Valley State College gym in Orem this fall.
...
But it's his Lehi project that has gained Andersen the most attention - that and the hiring of a world-renowned architect to create a distinct design at what Andersen calls the "gateway between Utah and Salt Lake counties."Gehry, who designed the Guggenheim Museum in Bilbao, Spain, and the Walt Disney Concert Hall in Los Angeles, also is working with rapper Jay-Z and the New Jersey Nets on a $400 million arena in Brooklyn.
Posted by amy at 11:20 AM
Work begins on Atlantic Yards project - Construction crews get started despite pending court cases that could block towers
Courier Life
Stephen Witt gives a lovely run-down of all the construction and demolition firms hired so far, listing whether they are minority or woman-owned, but not whether they are Brooklyn firms. He also allows Ratner three solid paragraphs of pure PR speak, and Stuckey gets his comments in as well. Aside from the title, there is not one mention of the lawsuits, even though he asserts that specific building in the footprint of the arena are to be knocked down:
In addition to the preparatory work, FCRC said they plan on demolishing on of their buildings – a former automotive repair shop -- at 179 Flatbush Avenue to make way for the Barclay’s Center arena and 16-skyscraper project.
As you, our more informed readers, already know, Daniel Goldstein's building ("center court") is at the center of the eminent domain lawsuit, and the arena plans cannot go forward unless the court case is settled in the developer's favor.
Also keeping FCRC at its word is the Empire State Development Corporation (ESDC), who earlier this month put out an RFP (Request for Proposals) for an environmental monitor on their behalf to oversee the construction.The monitor will assure that mitigating measures addressed in the Environmental Impact Statement are kept during the construction and other phases of the development.
Among the requirement items the ESDC environmental monitor will oversee include protecting nearby historic buildings, traffic conditions, air and noise quality, the scheduling of truck deliveries, rodent control and implementation of measures to retain and detain storm water.
Will they be protecting historic buildings like the Ward Bakery, which they want to demolish???
Posted by amy at 11:05 AM
February 24, 2007
Magistrate deals legal blow to critics of Atlantic Yards project
AMNY publishes a longer version of the AP story:
Despite the recommendation, plaintiff lawyer Matt Brinckerhoff predicted U.S. District Judge Nicholas Garaufis would allow the suit to go forward because it "involves an issue of paramount constitutional importance" -- making it more suitable for federal rather than state court.But if the magistrate's recommendation is upheld, plaintiffs will refile the suit in state court, said Candace Carponter, a spokeswoman for Develop Don't Destroy Brooklyn, one of the plaintiffs.
...
A spokesman for Mayor Michael Bloomberg, John Gallagher, applauded the decision."Atlantic Yards will create tens of thousands of jobs, provide hundreds of millions of dollars in tax revenue and thousands of units of affordable housing for the city, and we welcome this recommendation by the magistrate and are looking forward to the project moving ahead," he said.
Posted by amy at 10:58 AM
Magistrate: Throw Out Atlantic Yards Lawsuit
The Real Estate
Calling it a state and a local matter the federal government should abstain from, a federal magistrate recommended on Friday throwing out the eminent-domain case brought by tenants and property owners opposed to the Atlantic Yards project. The plaintiffs, including those who live in the footprint of the 22-acre project in central Brooklyn, want to stop the state from using eminent domain to seize property.The U.S. Court for the Eastern District of New York still makes the final decision on the lawsuit, but the magistrate's recommendation can't help matters for the plaintiffs. The defendants include developer Forest City Ratner, Mayor Bloomberg and former Governor George Pataki.
Also included is the full recommendation from Magistrate Robert M. Levy - after the jump.
UNITED STATES DISTRICT COURT EASTERN DISTRICT OF NEW YORK -------------------------------------------------------X DANIEL GOLDSTEIN, et al., Plaintiffs, REPORT AND RECOMMENDATION -against- 06 CV 5827 (NGG) (RML) GEORGE E. PATAKI, et al., Defendants. -------------------------------------------------------X LEVY, United States Magistrate Judge: All defendants move to dismiss the complaint, pursuant to Rules 12(b)(1) and 12(b)(6) of the Federal Rules of Civil Procedure. On November 21, 2006, the Honorable Nicholas G. Garaufis, United States District Judge, referred the motions to me for Report and Recommendation. Briefing was completed on February 1, 2007, and this court heard oral argument on February 7, 2007. For the reasons stated below, I respectfully recommend that defendants' motions be granted. BACKGROUND AND PROCEDURAL HISTORY A. The Plaintiffs and Their Claims Plaintiffs Daniel Goldstein, Jerry Campbell (as the putative administrator of the estate of Oliver St. Clair Stewart and in his individual capacity), The Gelin Group, LLC, Chadderton's Bar and Grill Inc. d/b/a/ Freddy's Bar and Backroom, Maria Gonzalez, Jackie Gonzalez, Yesenia Gonzalez, Huda Mufleh-Odeh, Jan Akhtar, David Sheets, Joseph Pastore, Peter Williams, Peter Williams Enterprises, Inc., Henry Weinstein, 535 Carleton Ave. Realty Corp., 535 Carlton Ave. Realty Corp., and Pacific Carlton Development Corp. (collectively, Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 1 of 42 1 Plaintiffs amended their complaint on January 5, 2007 to, inter alia, add some of the named plaintiffs listed above and eliminate a claim against former Governor Pataki in his official capacity. (See Amended Complaint, dated Jan. 5, 2007.) 2 The arena is slated to be home to the New Jersey Nets National Basketball Association Team. (See Declaration of Douglas M. Kraus, Esq., dated Dec. 15, 2006, Ex. E.) 3 Plaintiffs Daniel Goldstein, Jerry Campbell, the Estate of Oliver St. Clair Stewart, The Gelin Group LLC, Peter Williams, Peter Williams Enterprises, Inc., 535 Carleton Ave. Realty Corp., 535 Carlton Ave. Realty Corp., Henry Weinstein, and Pacific Carlton Development Corp. own and control real property. (Am. Compl. ¶¶ 6-8.) Plaintiff Chadderton's Bar and Grill Inc. d/b/a Freddy's Bar and Backroom has a lease for operation of a commercial enterprise. (Id. ¶ 9.) Plaintiffs Maria Gonzalez, Jackie Gonzalez, Yesenia Gonzalez, Huda Mufleh-Odeh, Jan Akhtar, David Sheets, and Joseph Pastore are residential tenants. (Id. ¶¶ 14 - 20.) 4 Section 1983 imposes liability on persons - including, by judicial construction, municipalities and other state agencies - who, acting under color of state law, deprive others of rights secured by the Constitution and federal laws. 42 U.S.C. § 1983 (2000). -2- "plaintiffs") commenced this action on October 26, 20061 seeking to enjoin the exercise of eminent domain to seize their properties in connection with a project known as the Atlantic Yards Arena and Redevelopment Project (the "Atlantic Yards Project" or the "Project"). As currently proposed, the Project is a mixed-use redevelopment project that would cover approximately twenty-two acres of land in and around the Metropolitan Transportation Authority's Vanderbilt Yards in Brooklyn, New York. (See Amended Complaint, dated Jan. 5, 2007 ("Am. Compl."), at 2 n.1.) It includes a sports arena with seating capacity for approximately 20,500,2 sixteen high-rise apartment and office towers containing approximately eight million square feet of residential, office and commercial space, and a 180-room hotel. (Id.) Plaintiffs own or rent property within the footprint of the Project. (See id. ¶¶ 6- 21.)3 They challenge the use of eminent domain under 42 U.S.C. § 1983,4 asserting claims under the Fifth Amendment's Takings Clause (as incorporated by the Fourteenth Amendment), which Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 2 of 42 5 Similarly, Article 1, § 7(a) of the New York State constitution provides that "[p]rivate property shall not be taken for public use without just compensation." However, the Amended Complaint contains no claim under the state constitution. 6 For their Equal Protection claim, plaintiffs allege that "[b]y selecting plaintiffs' properties to be taken for the purpose of conferring a benefit, here the plaintiffs' property, to [the private developer], defendants have targeted plaintiffs for adverse treatment for no rational purpose." (Am. Compl. ¶ 151.) As plaintiffs' counsel conceded at oral argument, this claim "will rise or fall with the public use claim." (Transcript of Oral Argument, dated Feb. 7, 2007 ("Tr."), at 51.) 7 Plaintiffs allege that defendants have deprived them of their property interests without due process of law by, inter alia, "(1) circumventing local and community review and local zoning regulations; (2) failing to provide sufficient time to meaningfully respond between the release of the Draft Environmental Impact Statement and the hearing on August 23, 2006; (3) failing to provide a hearing that allowed plaintiffs to meaningfully state their objections; and (4) at all times providing an empty, meaningless [] process, with a pre-determined outcome. . . ." (Am. Compl. ¶ 164.) 8 This claim is only asserted against the Empire State Development Corp. The Amended Complaint also asserted a claim under EDPL § 204(A) (see Am. Compl. ¶ 178 (alleging that the Determination and Findings are null and void because they were not made within 90 days of the close of the public hearing), but plaintiffs have since withdrawn that claim. (See Plaintiffs' Opposition to Defendants' Motion to Dismiss Plaintiffs' Supplemental EDPL Claims, dated Jan. 26, 2007, at 14 n.5.) -3- prohibits the taking of private property "for public use, without just compensation,"5 and the Fourteenth Amendment's Equal Protection6 and Procedural Due Process7 Clauses. (See id. ¶¶ 131-170.) They also assert a supplemental state law claim under New York Eminent Domain Procedure Law ("EDPL") § 207. (Id. ¶¶ 171-180.)8 Plaintiffs contend that the Project, which they describe as "the single largest multi-use real estate development in the history of the City of New York," constitutes "a betrayal of public trust in service of the interests of a private developer," namely defendant Bruce C. Ratner ("Ratner") and the companies he owns or controls. (Id. ¶ 2.) They accuse City and State officials of acting in concert with Ratner for the purpose of conferring a private benefit on the developer, who allegedly conceived of and Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 3 of 42 -4- initiated the Project. (Id.) They further maintain that "public input and review has been a sham" and that the defendants' findings of blight in the area are pretextual, as are their claims that the Project will result in a net economic benefit to the City and State, create significant affordable housing, and create thousands of new jobs. (Id. ¶¶ 4, 89-120.) Plaintiffs have stated that they intend to move for a preliminary injunction. B. The Defendants and Their Motions The defendants fall into four groups. They are: (1) the New York State Urban Development Corporation d/b/a the Empire State Development Corporation (the "ESDC"), a state public benefit corporation created pursuant to the New York State Urban Development Corporation Act of 1968 (the "UDC Act") and imbued by the New York legislature with eminent domain power (see N.Y. UNCONSOL. LAWS § 6263); and the ESDC's Chairman and Chief Executive Officer, Charles A. Gargano, sued in both his official and individual capacities; (2) former Governor George E. Pataki, sued in his individual capacity; (3) the City of New York; the New York City Economic Development Corporation; Mayor Michael Bloomberg; Deputy Mayor Daniel L. Doctoroff; Andrew Alper, former President of the New York City Economic Development Corporation; and Joshua Sirefman, Acting President of the New York City Economic Development Corporation, all sued in both their official and individual capacities (collectively, the "City defendants"); and (4) Bruce C. Ratner, James P. Stuckey, Forest City Enterprises, Inc., Forest City Ratner Company, Ratner Group, Inc., BR FCRC, LLC, BR Land, LLC, FCR Land, LLC, Brooklyn Arena, LLC, and Atlantic Yards Development Company, LLC (collectively, the "Forest City Ratner defendants"). All defendants move to dismiss the complaint on the grounds that it is not ripe Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 4 of 42 -5- and that it fails to state a claim upon which relief can be granted. They also urge this court to abstain from exercising federal jurisdiction under Younger v. Harris, 401 U.S. 37 (1971), or Burford v. Sun Oil Co., 319 U.S. 315 (1943). In addition to arguing that the complaint fails to state a claim under the public use clause, the Forest City Ratner defendants contend that plaintiffs' assertions of favoritism and of a "sham" review process "amount to a claim that defendants have acted corruptly and perpetrated a fraud on the public," which purportedly fails to comport with the heightened pleading requirement of Fed. R. Civ. P. 9(b). (See Forest City Ratner Defendants' Memorandum of Law in Support of Their Motion to Dismiss the Complaint, dated Dec. 15, 2006, at 19 n.14, 23-24.) They also challenge plaintiffs' equal protection and due process claims as insufficient. (Id. at 24-28.) Governor Pataki moves separately to dismiss the claims against him in his individual capacity on the grounds that plaintiffs do not allege his personal involvement in the alleged constitutional deprivation and because he is entitled to qualified immunity. (See Memorandum of Law of Defendant George E. Pataki in Support of His Motion to Dismiss the Complaint, dated Dec. 15, 2006 ("Pataki Mem."), at 10-13; Reply Memorandum of Law of Governor George E. Pataki in Support of His Motion to Dismiss the Amended Complaint, dated Jan. 19, 2007 ("Pataki Reply Mem.").) The Governor also argues that the claims against him in his individual capacity are moot, as he completed his term of office on December 31, 2006, prior to the taking of plaintiffs' properties. (Pataki Mem. at 13-14; Pataki Reply Mem. at 4-6.) Last, the City defendants move separately to dismiss the claims against them in both their individual and official capacities. (See Memorandum of Law in Support of City Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 5 of 42 -6- Defendants' Motion to Dismiss the Complaint, dated Dec. 15, 2006.) They argue that the Amended Complaint does not support the imposition of liability against them in their individual capacities because it does not allege specific facts showing each defendant's personal involvement in the condemnations. (Id. at 3-5.) They also contend that they are entitled to qualified immunity under section 1983 because it was objectively reasonable for them to believe that their conduct did not violate the law. (Id. at 6-7.) Finally, they maintain that the Amended Complaint does not state a cause of action against them in their official capacities because it does not allege that either the City or the EDC is the "moving force" behind the challenged condemnation proceedings. (Id. at 7-8.) Although plaintiffs allege that all of the defendants conspired with each other to deprive them of their constitutional rights, the City defendants argue that the allegations concerning their role in the purported conspiracy should be dismissed as "conclusory" and "nonspecific." (Id. at 8.) C. The Eminent Domain Procedure Law For purposes of context, a description of New York's EDPL, which provides a detailed and comprehensive statutory scheme for the taking of property, is in order. Until the state legislature enacted the EDPL in 1977, eminent domain powers were exercised through a patchwork of more than 150 disparate state and local provisions. Jackson v. N.Y. State Urban Dev. Corp., 494 N.E.2d 429, 436 (N.Y. 1986). Briefly, Article 2 of the EDPL sets forth the procedures that most condemnors must follow prior to acquiring property. Specifically, it requires condemnors to hold a non-judicial public hearing to review the public use of the proposed project and its impact on the environment. See EDPL § 201 (McKinney 2003 & Supp. 2006). Further, the EDPL requires that condemnors give notice of the hearing by publication Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 6 of 42 -7- and, since January 2005, requires that affected property owners be given individualized notice, either by personal service or certified mail. See id. § 202. Within ninety days of the conclusion of public hearings, the condemnor is required to publish its Determination and Findings, see id. § 204(A), which triggers an exclusive thirty-day period in which such Determination and Findings may be appealed in the Appellate Division. See id. § 207. The Determination and Findings must specify "(1) the public use, benefit or purpose to be served by the proposed public project; (2) the approximate location for the proposed public project and the reasons for selection of that location; (3) the general effect of the proposed project on the environment and residents of the locality." Id. § 204(B). Recent amendments to the EDPL also require that individuals whose properties are being condemned be given individualized notice of both the publication of the Determination and Findings and the thirty-day time limit on judicial challenges thereto. See id. § 204(C). Section 207(B) of the EDPL states that, once a condemnee challenges the Determination and Findings in the Appellate Division, the "jurisdiction of the appellate division of the supreme court shall be exclusive and its judgment and order shall be final subject to review by the court of appeals. . . ." The scope of review in the Appellate Division is narrow. It is "limited to whether: (1) the proceeding was in conformity with the federal and state constitutions, (2) the proposed acquisition is within the condemnor's statutory jurisdiction or authority, (3) the condemnor's determination and findings were made in accordance with procedures set forth in this article and with article eight of the environmental conservation law, and (4) a public use, benefit or purpose will be served by the proposed acquisition." Id. Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 7 of 42 9 In certain circumstances, not relevant here, a condemnor may be exempt from compliance with the requirements of Article 2. See EDPL § 206. -8- § 207(C).9 "'The principal purpose of EDPL article 2 is to insure that [a condemnor] does not acquire property without having made a reasoned determination that the condemnation will serve a valid public purpose.'" Waldo's Inc. v. Vill. of Johnson City, 534 N.Y.S.2d 723, 725 (3d Dep't 1988) (quoting Jackson, 494 N.E.2d 429), aff'd, 543 N.E.2d 74 (N.Y. 1989); accord Woodfield Equities, LLC v. Inc. Vill. of Patchogue, 813 N.Y.S.2d 184 (2d Dep't 2006). Upon filing a petition pursuant to EDPL § 207, the petitioner must serve a demand on the condemnor to file with the court a written transcript of the public hearing and a copy of its Determination and Findings. See EDPL § 207(A). The proceeding is then heard "on the record," with no discovery or evidentiary hearing. Id. See also Kaufmann's Carousel, Inc. v. City of Syracuse Indus. Dev. Agency, 750 N.Y.S.2d 212, 222 (4th Dep't 2002) (newspaper article appended to the EDPL petition challenging the condemnor's Determination and Findings was outside the record and therefore could not be considered by the Appellate Division), leave to appeal denied, 787 N.E.2d 1165 (N.Y. 2003); Waldo's, Inc., 534 N.Y.S.2d at 725 (stating that EDPL § 207 "does not provide for . . . adversarial proceedings."); Vill. Auto Body Works, Inc. v. Inc. Vill. of Westbury, 454 N.Y.S.2d 741, 743 (2d Dep't 1982) (EDPL § 207 "contemplates a summary review procedure. This court is to review the record and either reject or confirm the findings of the condemning authority."). Article 3 of the EDPL then controls the making of compensation offers for property that is subject to condemnation. The preamble to Article 3 states that the public policy of New York favors negotiated settlements. EDPL § 301. However, "the condemnor fulfills[ ] Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 8 of 42 -9- the requirements of EDPL § 303 by making an offer to respondent property owners that 'it believes to represent just compensation for the real property to be acquired.' There is no requirement that petitioner 'plead or prove, as a prerequisite to the acquisition of property by eminent domain, that it negotiated in good faith with the [property] owner[s].'" Nat'l Fuel Gas Supply Corp. v. Town of Concord, 752 N.Y.S.2d 187, 189 (4th Dep't 2002) (quoting Oswego Hydro Partners L.P. v. Phoenix Hydro Corp., 559 N.Y.S.2d 841, 841 (4th Dep't 1990)); see also Matter of County of Tompkins, 654 N.Y.S.2d 849, 851 (3d Dep't 1997). Under Article 4 of the EDPL, the condemnor may commence a proceeding to acquire title to the property up to three years after the later of: (1) publication of the Determination and Findings, or (2) entry of the final order or judgment on judicial review under § 207. (See EDPL § 401.) This is known as a "vesting proceeding," and the condemnor's petition must set forth (a) a statement of compliance with EDPL Article 2 (or with an exemption pursuant to EDPL 206); (b) a copy of the acquisition map; (c) a description of the property; (d) the public use; and (e) "a request that the court direct entry of an order authorizing the filing of the acquisition map . . . and that upon such filing, title shall vest in the condemnor." Id. § 402(B)(3). A condemnee opposing the taking may not wait until the condemnor initiates a vesting proceeding to raise its claims, but rather must seek review directly in the Appellate Division pursuant to EDPL § 207. See City of New Rochelle v. O. Mueller, Inc., 594 N.Y.S.2d 301, 302 (2d Dep't 1993); Matter of Farmington Access Rd., 549 N.Y.S.2d 236, 237 (4th Dep't 1989). In other words, if no prospective condemnee brings a claim in the Appellate Division pursuant to EDPL § 207, then the Article 4 proceeding is the first point of judicial review. Once the Article 4 proceeding is complete, just compensation may be adjudicated in the Court of Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 9 of 42 10 Both Memoranda of Understanding were dated February 18, 2005 and were signed by FCRC, the ESDC, the City of New York, and the New York City Economic Development Corporation. (See Krauss Decl., Exs. A, B.) -10- Claims pursuant to Article 5. In Brody v. Vill. of Port Chester, 434 F.3d 121, 133 (2d Cir. 2005), the Second Circuit held that the EDPL's post-determination review procedure for challenging public use satisfies due process. Although EDPL § 207 provides for a post-determination hearing that is "summary in nature, restricting both the issues that can be raised and the evidence the court will consider," the Second Circuit concluded that "[d]ue process does not require New York to furnish a procedure to challenge public use beyond that which it already provides." Id. Plaintiffs have not brought a facial challenge to the EDPL. Nor do they allege that the ESDC has failed to comply with the EDPL's requirements. D. The Current Posture The Project was first announced in December 2003 (Am. Compl. ¶ 68), and Memoranda of Understanding concerning the Project were signed in early 2005. (Id. ¶¶ 670-72; Declaration of Douglas M. Kraus, Esq., dated Dec. 15, 2006 ("Kraus Decl."), Exs. A, B.)10 In May 2005, the Metropolitan Transit Authority (the "MTA") issued a request for proposals for the purchase of the development rights attributable to the Vanderbilt Yards site, an 8.5-acre rail yard and bus depot within the Project's footprint. (Am. Compl. ¶ 75.) Two companies, including the Forest City Ratner Companies ("FCRC"), submitted formal bids (id. ¶¶ 77-78), and on July 27, 2005, the MTA's Board of Directors selected FCRC as the winning bidder. (Id. ¶ Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 10 of 42 11 The other bidder was Extell Development Company. (Am. Compl. ¶ 78.) 12 According to plaintiffs, FCRC paid for the blight study. (Am. Compl. ¶ 100.) The blight study concluded, inter alia, that the proposed Project site "has suffered from physical deterioration and relative economic inactivity for at least four decades." It described the site as "[d]ominated by an approximately 9-acre open rail yard and otherwise generally characterized by dilapidated, vacant, and underutilized properties[.]" (Krauss Aff., Ex. D at B-1.) Plaintiffs contest this finding, arguing that it is a "classic post-hoc justification" and that the increase in vacant lots in the area between December 2003 and October 2006 is "squarely attributable to defendants['] own conduct." (Am. Compl. ¶¶ 98, 106.) 13 Under the UDC Act, the ESDC may only condemn property for a land use development project if it determines "[t]hat the area in which the project is to be located is a substandard or insanitary area, or is in danger of becoming a substandard or insanitary area and tends to impair or arrest the sound growth and development of the municipality." N.Y. UNCONSOL. LAWS § 6260(c)(1). -11- 79.)11 On September 14, 2005, the MTA and FCRC formally announced the terms of an agreement. (Id. ¶ 80.) A "Blight Study" was performed by AKRF, Inc. and completed in July 2006. (See Declaration of Jeffrey L. Braun, Esq., dated Dec. 15, 2006 ("Braun Decl."), Ex. C.)12 On July 18, 2006, ESDC issued a formal declaration that the Project qualified as a land use development and civic project under the UDC Act. (Am. Compl. ¶ 47; Kraus Decl., Ex. E.)13 A Draft Environmental Impact Statement, prepared by AKRF, Inc. and Philip Habib & Associates pursuant to the State Environmental Quality Review Act, was also released on July 18, 2006. (Braun Decl., Ex. B.) On August 23, 2006, ESDC held a duly-noticed public hearing concerning the Project, in accordance with EDPL §§ 202 and 203. (Am. Compl. ¶ 84.) In addition, ESDC conducted community forums on September 12 and 18, 2006 and accepted written comments until September 29, 2006. (Id. ¶¶ 85-86; Memorandum of Law of ESDC Defendants in Support of Their Motion to Dismiss the Complaint, dated Dec. 15, 2006 ("ESDC Mem."), at 8; Forest City Ratner Defendants' Memorandum of Law in Support of Their Motion to Dismiss the Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 11 of 42 14 The plaintiffs in that action, entitled Anderson v. New York State Urban Development Corporation, are all rent-stabilized tenants in two buildings owned by FCRC. Their petition seeks, inter alia, a judgment rejecting the ESDC's Determination and Findings, pursuant to EDPL § 207 "with respect to the acquisition of 624 Pacific Street and 473 Dean Street, Brooklyn, New York, in furtherance of the Atlantic Yards Arena and Redevelopment Project." (See Declaration of Douglas M. Kraus, Esq., dated Jan. 19, 2007, Ex. A.) 15 The parties disagree as to whether the 30-day period for appeal under EDPL § 207(B) is subject to tolling under 28 U.S.C. § 1367(d). That issue is not presently before the court. -12- Complaint, dated Dec. 15, 2006 ("FCRC Mem.") at 4 n.3.) A Final Environmental Impact Statement was certified as complete on November 27, 2006. See www.empire.state.ny.us/AtlanticYards/FEIS (last checked Feb. 6, 2007). Pursuant to EDPL § 204(A), ESDC published its Determination and Findings on December 8, 2006. In its Determination and Findings, ESDC confirmed that it intends to exercise its eminent domain power to acquire private properties within the Project site. (Kraus Decl., Ex. E; ESDC Mem. at 7-8.) On December 20, 2006, the Public Authorities Control Board, which has the power and duty to "receive applications for approval of the financing and construction of any project proposed by [certain specified] state public benefit corporations" (N.Y. PUB. AUTH. L., Art. 1-A, §§ 50,51), approved the Project. On January 11, 2007, a separate group of plaintiffs filed a petition in the New York Appellate Division, Second Department, pursuant to EDPL § 207(B).14 The exclusive 30- day period in which the ESDC's Determination and Findings may be appealed in the Appellate Division has now passed.15 ESDC has yet to file an Article 4 proceeding seeking transfer of title to plaintiffs' properties. DISCUSSION A. Standard for Motion to Dismiss under Rule 12(b)(1) Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 12 of 42 -13- Defendants move to dismiss plaintiffs' complaint for lack of subject matter jurisdiction, pursuant to Fed. R. Civ. P. 12(b)(1). Federal courts are courts of limited jurisdiction and the law presumes that "a cause lies outside this limited jurisdiction." Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994); see also Exxon Mobil Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 552 (2005) (federal courts are "courts of limited jurisdiction" whose powers are confined to statutorily and constitutionally granted authority); Gen. Motors Corp. v. EPA, 363 F.3d 442, 448 (D.C. Cir. 2004) (noting that "[a]s a court of limited jurisdiction, we begin, and end, with an examination of our jurisdiction."). Because subject matter jurisdiction is an Article III requirement, "no action of the parties can confer subject-matter jurisdiction upon a federal court.'" Hoeft v. MVL Grp., Inc., 343 F.3d 57, 66 (2d Cir. 2003) (quoting Ins. Corp. of Ir., Ltd. v. Compagnie des Bauxites de Guinee, 456 U.S. 694, 702 (1982)). On a motion to dismiss under Rule 12(b)(1), the plaintiff bears the burden of establishing that the court has subject matter jurisdiction. Lujan v. Defenders of Wildlife, 504 U.S. 555, 561 (1992); Gilman v. BHC Sec., 104 F.3d 1418, 1421 (2d Cir. 1997). However, the court may dismiss a complaint for lack of subject matter jurisdiction only if "'it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.'" Commodity Futures Trading Comm'n v. Int'l Foreign Currency, Inc., 334 F. Supp. 2d 305, 309 (E.D.N.Y. 2004) (quoting Fortress Bible Church v. Feiner, No. 03-4235, 2004 WL 1179307, at *1 (S.D.N.Y. Mar. 29, 2004)). Because subject matter jurisdiction focuses on the court's power to hear the claim, the court must give the plaintiff's factual allegations closer scrutiny when resolving a Rule 12(b)(1) motion than would be required for a Rule 12(b)(6) motion for failure to state a claim. Macharia v. United States, 334 F.3d 61, 64, 69 (D.C. Cir. Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 13 of 42 -14- 2003), cert. denied, 540 U.S. 1149 (2004); Grand Lodge of Fraternal Order of Police v. Ashcroft, 185 F. Supp. 2d 9, 13 (D.D.C. 2001). Moreover, the court is not limited to the allegations in the complaint; instead, to determine whether it has jurisdiction over the claim, the court may consider materials outside the pleadings. Makarova v. United States, 201 F.3d 110, 113 (2d Cir. 2000); Kamen v. American Tel. & Tel. Co., 791 F.2d 1006, 1011 (2d Cir. 1986). B. Ripeness Defendants urge this court to dismiss the complaint for lack of subject matter jurisdiction on the ground that it is not ripe for judicial review. They argue that plaintiffs' claims will not be ripe for review until condemnation proceedings are commenced pursuant to EDPL Article 4. It is axiomatic that federal courts may adjudicate only those "real and substantial controvers[ies] admitting of specific relief . . . as distinguished from an opinion advising what the law would be upon a hypothetical state of facts." Lewis v. Continental Bank Corp., 494 U.S. 472, 477 (1990). Thus, ripeness is a constitutional prerequisite to the exercise of federal jurisdiction. See Nutritional Health Alliance v. Shalala, 144 F.3d 220, 225 (2d Cir. 1998). "The ripeness doctrine's basic rationale is to prevent the courts through avoidance of premature adjudication from entangling themselves in abstract disagreements." Woodfield Equities, LLC v. Inc. Vill. of Patchogue, 357 F. Supp. 2d 622, 632 (E.D.N.Y.) (internal quotation marks and citation omitted), aff'd, 156 Fed. Appx. 389 (2d Cir. 2005). The ripeness doctrine asks "whether the case has been brought at a point so early that it is not yet clear whether a real dispute to be resolved exists between the parties." 15 JAMES WM. MOORE ET AL., MOORE'S FED. PRAC. § 101.70[2] (3d ed. 1997). Because ripeness is jurisdictional and stems from the Article III requirement that federal courts hear only cases or controversies, the court is obliged to Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 14 of 42 16 As defendants correctly note, the Second Circuit has held that a federal court may decide to abstain without addressing Article III limitations on jurisdiction. See Spargo v. N.Y. State Comm'n on Judicial Conduct, 351 F.3d 65, 74 (2d Cir. 2003) (explaining that, although federal courts may not exercise hypothetical jurisdiction to dismiss claims on the merits, they have flexibility "'to choose among threshold grounds' for disposing of a case without reaching the merits.") (quoting Ruhrgas AG v. Marathon Oil Co., 526 U.S. 574, 585 (1999)). In the interest of making a thorough Report and Recommendation on defendants' motions, I will address the issue of ripeness. -15- consider the ripeness question before reaching the merits of plaintiffs' claims. See Reno v. Catholic Soc. Servs., Inc., 509 U.S. 43, 57 n. 18 (1993) (explaining that "[the] ripeness doctrine is drawn both from Article III limitations on judicial power and from prudential reasons for refusing to exercise jurisdiction."); Vandor v. Militello, 301 F.3d 37, 38 (2d Cir. 2002) ("We are obliged to consider the ripeness question before reaching the merits of [the plaintiff's] claims because ripeness is jurisdictional."); see also Steel Co. v. Citizens for a Better Env't, 523 U.S. 83, 84 (1998) (instructing federal courts to resolve questions of Article III jurisdiction before reaching the merits of a plaintiff's claim).16 Moreover, because ripeness is a jurisdictional inquiry, the court "must presume that [it] cannot entertain [plaintiffs'] claims 'unless the contrary appears affirmatively from the record.'" Murphy v. New Milford Zoning Comm'n, 402 F.3d 342, 347 (2d Cir. 2005) (quoting Renne v. Geary, 501 U.S. 312, 316 (1991)). To measure ripeness, the court must look to: (1) whether the controversy is fit for judicial adjudication; and (2) the hardship to the parties of withholding court consideration. Abbott Labs. v. Gardner, 387 U.S. 136, 149 (1967). In essence, this approach balances the need for decision against the risks of decision: "[t]he need to decide is a function of the probability and importance of the anticipated injury," whereas "[t]he risks of decision are measured by the difficulty and sensitivity of the issues presented, and by the need for further factual development Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 15 of 42 -16- to aid decision." Charles Alan Wright, Arthur R. Miller and Edward H. Cooper, 13A FEDERAL PRACTICE AND PROCEDURE § 3532.1 (2006). With respect to the first prong, the central inquiry is whether the court would benefit from deferring initial review until the claims it is called on to consider "have arisen in a more concrete and final form." Murphy, 402 F.3d at 347. If a claim rests upon contingent future events that may not occur as anticipated, or may not occur at all, it is not ripe for adjudication. Auerbach v. Bd. of Educ., 136 F.3d 104, 108-09 (2d Cir. 1998); see also In re Drexel Burnham Lambert Grp., Inc., 995 F.2d 1138, 1146 (2d Cir. 1993) (stating that adjudication is inappropriate where there is "no certainty" that the complained-of action will occur). On the other hand, the "hardship to the parties" prong "injects prudential considerations into the mix," requiring the court to "gauge the risk and severity of injury to a party that will result if the exercise of jurisdiction is declined." Murphy, 402 F.3d at 347. In Williamson County Regional Planning Commission v. Hamilton Bank of Johnson City, 473 U.S. 172, 194-95 (1985), the Supreme Court established a two-pronged test for analyzing ripeness of claims under the Fifth Amendment's Takings Clause. Williamson County involved a landowner's claim in federal district court for money damages suffered when the planning commission allegedly took the landowner's property in the course of applying local land use regulations. Id. at 175. The Sixth Circuit upheld a jury award of money damages to the landowner (Williamson County Reg'l Planning Comm'n v. Hamilton Bank, 729 F.2d 402, 409 (6th Cir. 1984)), but the Supreme Court found the landowner's claim unripe on two grounds. First, the Court held that a takings claim "is not ripe until the government entity charged with implementing the regulations has reached a final decision regarding the application of the regulations to the property at issue." Williamson County, 473 U.S. at 186. A "final decision" is Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 16 of 42 17 For example, if the federal government committed the alleged taking, the plaintiff would not have to proceed in state court. See, e.g., Hodel v. Irving, 481 U.S. 704, 711 (1987). In addition, a facial attack on an ordinance need not comply with the finality rule. See Suitum v. Tahoe Reg'l Planning Agency, 520 U.S. 725, 736, 736 n.10 (1997) ("[F]acial challenges to (continued...) -17- a "definitive position on the issue that inflicts an actual, concrete injury." Id. at 193. In Williamson County, the Court found that the plaintiff developer had not yet obtained a final decision because it had failed to seek "variances that would have allowed it to develop the property according to its proposed plan." Id. at 188. Second, the Court held that a takings claim is not ripe until the landowner has availed itself of the state's procedures for obtaining just compensation. Id. at 195. The Court noted that the state of Tennessee authorized landowners to bring "inverse condemnation" actions to obtain just compensation for alleged takings effected by restrictive zoning laws or development restrictions. Id. at 196. It held that the landowner "cannot claim a violation of the Just Compensation Clause until it has used the procedure and been denied just compensation." Id. at 195. "The second prong of the Williamson test applies to physical as well as regulatory takings," where the plaintiff alleges a violation of the just compensation clause. RKO Delaware, Inc. v. City of N.Y., No. CV002592, 2001 WL 1329060, at *4 (E.D.N.Y. Aug. 30, 2001). See also Pascoag Reservoir & Dam, LLC v. Rhode Island, 337 F.3d 87, 92 (1st Cir. 2003) (applying the exhaustion exceptions of Williamson County to physical takings); Villager Pond, Inc. v. Town of Darien, 56 F.3d 375, 380 (2d Cir. 1995) ("'Even in physical taking cases, compensation must first be sought from the state if adequate procedures are available.'") (quoting Sinaloa Lake Owners Ass'n v. City of Simi Valley, 882 F.2d 1398, 1402 (9th Cir.1 989)). Thus, Williamson County stands for the general proposition that, subject to limited exceptions,17 a landowner Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 17 of 42 17(...continued) regulation are generally ripe the moment the challenged regulation or ordinance is passed, but face an uphill battle, since it is difficult to demonstrate that mere enactment of a piece of legislation deprived [the owner] of economically viable use of [his] property.") (internal citations and quotations omitted)). 18 The Second Circuit has noted that "[t]he ripeness requirement of Williamson, although announced in a takings context, has been extended to equal protection and due process claims asserted in the context of land use challenges." Dougherty v. Town of N. Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 88 (2d Cir. 2002). See also Murphy, 402 F.3d at 349 (observing that Williamson County's ripeness requirement has been extended to equal protection and due process challenges to zoning decisions); Southview Assocs., Ltd. v. Bongartz, 980 F.2d 84, 96-97 (2d Cir. 1992) (applying ripeness requirement to substantive due process claims); Kittay v. Giuliani,112 F. Supp. 2d 342, 349 & n.5 (S.D.N.Y. 2000) ("the ripeness inquiry is the same for each of plaintiff's as-applied takings, due process, equal protection and First Amendment claims."), aff'd, 252 F.3d 645 (2d Cir. 2001). Inasmuch as plaintiff's takings, due process and equal protection claims arise out of the same factual events, the court will apply the same ripeness inquiry to all of plaintiffs' claims. See Dougherty, 282 F.3d at 88-89, 92 n. 7; Goldfine v. Kelly, 80 F. Supp. 2d 153, 158-59 (S.D.N.Y. 2000); Kittay, 112 F. Supp. 2d at 349 & n. 5. 19 Of course, once a litigant's federal claims related to the merits of the taking are determined in state court, res judicata and collateral estoppel may operate to bar that litigant from bringing his or her claims in federal court. The Supreme Court recently explained in San Remo that permitting federal review of state court awards of just compensation for takings would deny full faith and credit to state court rulings in federal courts. See San Remo, 545 U.S. at 338 (stating that "Congress has not expressed any intent to exempt from the full faith and credit statute federal takings claims" and applying the "normal assumption that the weighty (continued...) -18- cannot prevail on a just compensation claim in federal court until it has failed in its effort to obtain relief through the state courts.18 The Supreme Court recently reaffirmed this holding in San Remo Hotel, L.P. v. City & County of San Francisco, 125 S. Ct. 2491 (2005). In that case, the Court explained that a regulatory takings claim "is not ripe until the government entity charged with implementing the regulations has reached a final decision regarding the application of the regulations to the property at issue," and it confirmed the requirement that a landowner challenging a regulatory taking proceed - at least initially - in state court. Id. at 2507.19 Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 18 of 42 19(...continued) interests in finality and comity trump the interest in giving losing litigants access to an additional appellate tribunal"). Indeed, San Remo has been described as "in many ways the most significant" Supreme Court takings case from 2005, "because its combination of ripeness and preclusion doctrines appears to bar the door to federal court for virtually all federal takings claims" and because the Court in that case "emphatically rejected the notion that takings plaintiffs have a right to federal adjudication" Stewart E. Sterk, The Demise of Federal Takings Litigation, 48 WM. & MARY L. REV. 251, 253 (Oct. 2006). See also J. David Breemer, You Can Check Out But You Can Never Leave: The Story of San Remo Hotel - The Supreme Court Relegates Federal Takings Claims to State Courts Under a Rule Intended to Ripen the Claims for Federal Review, 33 B.C. ENVTL. AFF. L. REV. 247, 250 (2006) (criticizing the Supreme Court's decision in San Remo as banishing takings claims to state courts). -19- Both Williamson County and San Remo arose in the regulatory takings context, where the plaintiffs were seeking just compensation for an alleged taking, and neither involved a challenge to a condemnation under the Fifth Amendment's public use clause. Because just compensation is not an issue in this case, the parties agree that Williamson County's framework is inapplicable here. (See ESDC Mem. at 13; Plaintiffs' Memorandum of Law in Opposition to Defendants' Motion to Dismiss, dated Jan. 5, 2007, at 16.) It is true, as plaintiffs argue, that no Supreme Court precedent directly forecloses the possibility of securing federal jurisdiction by seeking declaratory or injunctive relief under the public use clause, and courts in other circuits have declined to require public use plaintiffs to seek just compensation in state court. See Theodorou v. Measel, 53 Fed. Appx. 640, 643 (3d Cir. 2002) (holding that because "[s]tate takings of private property for private use are not permitted . . . with or without just compensation," a property owner "need not seek compensation for an alleged physical taking for private use through a state procedure in order to ripen [his or her] claim."); Montgomery v. Carter County, 226 F.3d 758, 770-71 (6th Cir. 2000) (takings case held ripe where property owner's driveway had been classified as a public road; state eminent Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 19 of 42 20 It bears noting that the courts are not unanimous on this point. The Seventh Circuit, for example, "has consistently maintained a strict requirement that Takings Clause litigants must first take their claim to state court even when plaintiffs . . . are alleging a taking for private purpose." Daniels v. Area Plan Comm'n, 306 F.3d 445, 453 (7th Cir. 2002) (citing Forseth v. Vill. of Sussex, 199 F.3d 363, 370 (7th Cir. 2000); Covington Court Ltd. v. Vill. of Oak Brook, 77 F.3d 177, 179 (7th Cir. 1996); and Gamble v. Eau Claire County, 5 F.3d 285, 288 (7th Cir.1993)) (finding that the plaintiffs' claim satisfied the futility exception to Williamson County's ripeness requirement, and therefore declining to resolve the tension between the Seventh Circuit's and other circuits' readings of Williamson County). -20- domain proceedings "would not supply the appropriate remedy" because plaintiff was not seeking just compensation); Armendariz v. Penman, 75 F.3d 1311, 1320-21 and n.5 (9th Cir. 1996) (en banc) ("Because a 'private taking' cannot be constitutional even if compensated, a plaintiff alleging such a taking would not need to seek compensation in state proceedings before filing a federal takings claim under the rule of Williamson County"); Samaad v. City of Dallas, 940 F.2d 925, 936-37 (5th Cir. 1991) (holding that "a taking for a private purpose is unconstitutional even if the government provides just compensation," but concluding that noise from automobile racing at nearby fairground did not constitute a taking). However, the instant case is factually distinguishable in that, at this moment in time, there has been no taking of plaintiffs' property. In each of these cases, in which a public use claim was deemed ripe, the alleged taking had already occurred. Thus, even assuming plaintiffs are not required to seek just compensation in state court in order to ripen their claims,20 the question remains as to when a public use claim relating to a planned condemnation is ripe for adjudication. The parties have cited no case in this circuit, and the court's independent research uncovered none, explaining precisely when a public use claim is ripe for adjudication. However, Port Chester Yacht Club, Inc. v. Iasillo, 614 F. Supp. 318 (S.D.N.Y. 1985), is instructive. In that Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 20 of 42 -21- case the court explained that, in order to support a claim of an unconstitutional taking in violation of the Fourteenth Amendment and § 1983, a plaintiff must establish three elements: "(1) a property interest, (2) that has been taken under the color of state law, (3) without due process or just compensation." Id. at 321 (citing Parratt v. Taylor, 451 U.S. 572, 535-37 (1981); Kohlasch v. N.Y. State Thruway Auth., 460 F. Supp. 956, 960 (S.D.N.Y. 1978)). The plaintiffs in Port Chester challenged an urban redevelopment plan, which was slated to involve the use of eminent domain, on the ground that the planned taking was for private use. The court noted that the plaintiffs were not required to "wait until they are physically evicted before they can claim that they have been deprived of their property without due process of law," but stated that to establish a constitutional violation, a condemnee challenging a taking must show evidence of "'physical entry by the condemnor [or], a physical ouster of the owner [or], a legal interference with the physical use, possession or enjoyment of the property or a legal interference with the owner's power of disposition of the property.'" Id. at 321 n.5 (quoting City of Buffalo v. J.W. Clement Co., 269 N.E.2d 895, 903 (N.Y. 1971)). Plainly stated, "[t]he simple approval of a redevelopment plan can not be considered a deprivation of [a prospective condemnee's] constitutional rights" because "[o]nly when an individual has been deprived of property without due process of law has he been injured in a constitutional sense." Id. at 321. The court therefore dismissed the plaintiff's § 1983 claim, directing it to "take advantage of the adequate state procedures" available to it. Id. at 322. Although, as plaintiffs emphasize, the language of Port Chester Yacht Club focuses almost entirely on the plaintiff's due process claim, it is clear from the opinion that the plaintiff in that case was also seeking injunctive relief under the Fifth Amendment's Public Use Clause, and that the court dismissed that claim on ripeness grounds for Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 21 of 42 -22- failure to pursue available state remedies. Id. at 319, 321. Other decisions demonstrate that federal courts are reticent to adjudicate public use claims until the taking is final. See, e.g., Wendy's Int'l, Inc. v. City of Birmingham, 868 F.2d 433, 436 (11th Cir. 1989) (public use claims held unripe because the likelihood that the plaintiffs' property would be confiscated had "not yet matured into a credible certainty;" since the redevelopment plan at issue obligated the developer to attempt to reach negotiated settlements with property owners, the threat of condemnation "simply [wa]s too attenuated to stir up an actual controversy."); Frempong-Atuahene v. Redevelopment Auth. of City of Philadelphia, No. 98-0285, 1999 WL 167726, at *3 (E.D. Pa. Mar. 25, 1999) (because plaintiff's public use claims could be vindicated by a favorable outcome in a pending state court action, plaintiff's federal claims were not ripe for federal review), aff'd mem., 211 F.3d 1261 (3d Cir. 2000); Hemperly v. Crumpton, 708 F. Supp. 1247, 1250 (M.D. Ala. 1988) (public use claim held not ripe for disposition where state condemnation proceedings had not yet been initiated); Eddystone Equipment and Rental Corp. v. Redevelopment Authority of Delaware County, Civ. A. No. 87-8246, 1988 WL 52082, *2 (E.D. Pa. May 17, 1988) (citing Williamson County for the proposition that § 1983 claim challenging taking on public use grounds "would not be 'ripe' before the state court rendered final approval of the condemnation."), aff'd mem., 862 F.2d 307 (3d Cir. 1988). See also Hancich v. Gopoian, 815 F.2d 883, 884 (2d Cir. 1987) (issue of whether decrease in mobile home's resale value due to eviction from lot would constitute a taking of plaintiff's property without due process held premature where no eviction order had yet been entered in state court); Woodfield Equities, L.L.C., 357 F. Supp. 2d at 632 (holding that Village's decision to condemn the property at issue was not "a final action" because the Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 22 of 42 21 The court in Rosenthal & Rosenthal gave short shrift to the defendants' abstention argument, stating simply that it saw "no need to abstain in deference to possible state proceedings filed after the commencement of this action." 605 F. Supp. at 615. -23- condemnation still be had to be approved by the Appellate Division under EDPL § 207). These holdings are consistent with general ripeness jurisprudence. As explained above, when the events alleged in a plaintiff's cause of action have not yet occurred or are not certain to occur, a federal court is precluded from exercising subject matter jurisdiction because a real case or controversy does not exist for purposes of Article III. See Auerbach, 136 F.3d at 108. In opposition, plaintiffs cite Rosenthal & Rosenthal Inc. v. N.Y. State Urban Dev. Corp., 605 F. Supp. 612 (S.D.N.Y. 1985), aff'd, 771 F.2d 44 (2d Cir. 1985) (per curiam), and Hawaii Housing Auth. v. Midkiff, 467 U.S. 229 (1984), in which the courts dismissed public use claims on the merits, with little or no discussion of the ripeness issue. In Rosenthal & Rosenthal, the court found - with scant analysis - that the plaintiffs' suit to enjoin condemnation of their properties was ripe for review because the redevelopment project at issue had been approved by the Board of Estimate, the ESDC had published its Determination and Findings, and the condemnation was "imminent," notwithstanding potential delays due to the pendency of state proceedings challenging the project, which had been filed after commencement of the federal action. Id. at 614-15. Explaining that "[t]he federal courts remain available for challenges to truly private or truly irrational takings,"21 the court proceeded to dismiss the case for failure to state a cause of action, holding that the plaintiffs could not demonstrate that no public purpose existed for the project. Id. at 619. In Midkiff, the plaintiffs challenged the constitutionality of the Hawaii Land Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 23 of 42 22 The Ninth Circuit reversed, holding that the Hawaii Land Reform Act violated the public use clause (see 702 F.2d at 798), and the Supreme Court reversed that decision, concluding that the statute did not violate the Fifth Amendment's public use requirement. See Hawaii Housing Auth. v. Midkiff, 467 U.S. 229 (1984). Again, neither court addressed the issue of ripeness. -24- Reform Act, which allowed the State to use the power of eminent domain to condemn certain residential land and then sell it to the residential lessees. See Midkiff v. Tom, 483 F. Supp. 62 (D. Haw. 1979). The plaintiffs brought suit under the Fifth Amendment's public use clause, and the district court framed the issue as "limited in scope to the question of whether the plaintiffs were denied substantive due process." Id. at 65. Explaining that the court's only inquiry was to determine whether the statute furthered "the health, safety, morals, or general welfare of the people of Hawaii," and whether "the means chosen to accomplish that object are rational and not in bad faith," the court found the law constitutional on its face as "within reach of the police power." Id. at 67. At the time Midkiff was filed in federal district court, no condemnation actions had yet been filed in the state courts. See Midkiff v. Tom, 702 F.2d 788, 789 n.1 (9th Cir. 1983). Nonetheless, no party raised the issue of ripeness and the court did not consider that issue.22 These cases, as well as the others cited in plaintiffs' brief, confirm the principle that the pertinent question for ripeness purposes is whether the challenged condemnation is final, imminent, or inevitable. In Midkiff, although condemnation proceedings had not been commenced, the state had made the statutorily required finding that the acquisition of the lands in question would further the statute's public purposes and had ordered the landowners to submit to compulsory arbitration with their lessees for the purpose of determining the prices at which the properties would be sold. Id. at 234. Thus, under Hawaii's law, it was inevitable that the Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 24 of 42 23 In 99 Cents Only Stores, the municipality later denied any intention to reinitiate condemnation proceedings and in fact took significant affirmative and irreversible steps toward (continued...) -25- landowners eventually would be forced to surrender their property. Likewise, the court in Rosenthal & Rosenthal characterized the condemnations at issue in that case as "imminent." 605 F. Supp. at 615. See also Berman v. Parker, 348 U.S. 26, 28-30 (1954) (upholding constitutionality of the District of Columbia Redevelopment Act of 1945, which was authorized by Congress to eliminate blight, prior to the commencement of condemnation proceedings without addressing ripeness issue); Aaron v. Target Corp., 269 F. Supp. 2d 1162, 1176 (E.D. Mo. 2003) (granting temporary restraining order enjoining state condemnation proceedings and holding that public use claim was ripe for review because the pending state court action represented "a manifest and palpable threat that the Properties will be taken in violation of the Public Use Clause of the Fifth and Fourteenth Amendments."), rev'd on Younger abstention grounds, 357 F.3d 768 (8th Cir. 2004); Cottonwood Christian Ctr. v. Cypress Redevelopment Agency, 218 F. Supp. 2d 1203, 1215-16 (C.D. Ca. 2002) (granting church's motion for preliminary injunction against city's condemnation proceedings, where injunction was authorized under the Religious Land Use and Institutionalized Persons Act and plaintiff had already been denied a conditional use permit for church facility construction); 99 Cents Only Stores v. Lancaster Dev. Agency, 237 F. Supp. 2d 1123, 1127 (C.D. Ca. 2001) (granting preliminary injunction to enjoin a threatened taking under a city ordinance authorizing condemnation, even though no condemnation proceeding had begun, where there was a "reasonable likelihood" that the municipality would initiate condemnation proceedings in the future), appeal dismissed on mootness grounds, 60 Fed. Appx. 123 (9th Cir. 2003).23 Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 25 of 42 23(...continued) the implementation of an alternate plan. 60 Fed. Appx. at 125. The Ninth Circuit therefore dismissed the appeal as moot. Id. It is impossible to know whether the district court's injunction was the motivating factor behind the municipality's decision to abandon its initial plan, or whether the condemnation would never have taken place in any event. -26- As all of the above cases reveal, however, the notion of "finality" or "imminence" in this context is amorphous, open to interpretation, and at any rate highly fact-specific. Indeed, two cases decided the same year by different judges on the same court - Rosenthal & Rosenthal and Port Chester Yacht Club - reached seemingly contradictory conclusions in similar factual scenarios. This court's research uncovered no opinion from any jurisdiction citing to both of these cases. Moreover, as the court stressed in Didden v. Village of Port Chester, 304 F. Supp. 2d 548, 569 (S.D.N.Y. 2004), local eminent domain procedures differ materially among jurisdictions; as a result, cases from other jurisdictions have limited precedential value. It is against this backdrop of conflicting and frequently opaque authority that this court must determine whether the condemnations at issue in this case are sufficiently final or imminent to satisfy Article III's ripeness requirement. However, a separate line of cases, briefly mentioned by plaintiffs and discussed at oral argument, enters into the equation. In Didden, 304 F. Supp. 2d 548, the plaintiff landowners sought injunctive relief staying a condemnation proceeding that the Village of Port Chester had commenced in 2003 in connection with a largescale redevelopment project. The court found the plaintiffs' § 1983 claims barred by the applicable three-year statute of limitations. It explained that federal law dictates when a federal cause of action accrues and that "a cause of action under 42 U.S.C. § 1983 accrues when the plaintiff knows or has reason to know of the injury which is the basis of the action." Id. at 558. The court determined that the plaintiffs "had reason to know of the basis of their injury as soon Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 26 of 42 -27- as the [Port Chester Board of Trustees] announced its public purpose finding [in July 1999]" and the Village authorized a land disposition agreement with the developer covering the use of eminent domain and finding a legitimate public purpose for condemnation as a means of acquiring property for the project. Id. The court rejected the plaintiffs' argument that they did not suffer an injury until four years later, when the developer allegedly attempted to exact a cash payment from them on threat of condemnation. Id. at 559. Instead, it found the plaintiffs' claims time-barred on the ground that they "were able to, and did in fact, contemplate Port Chester's actions in 1999." Didden v. Vill. of Port Chester, 322 F. Supp. 2d 385, 389 (S.D.N.Y. 2004) (dismissing amended complaint on same grounds), aff'd, 173 Fed. Appx. 931, 2006 WL 898093 (2d Cir. 2006), cert. denied, _ S. Ct. __, 2007 WL 91474 (Jan. 16, 2007). It stands to reason that if the plaintiffs' claims accrued, for statute of limitations purposes, at the time of the government entity's public purpose finding, then their claims must have been ripe at that point. Indeed, although ripeness was not an issue in Didden, courts often use the terms "ripeness" and "accrual" interchangeably. See, e.g., W.J.F. Realty Corp. v. Town of Southampton, 351 F. Supp. 2d 18, 23 (E.D.N.Y. 2004) (explaining, in a regulatory takings case, that "[a] claim under section 1983 is not ripe - and a cause of action under section 1983 does not accrue - until" the state denies just compensation.); Williams v. Dow Chem. Co., No. 01 Civ. 4307, 2004 WL 1348932, at *7 (S.D.N.Y. June 16, 2004) ("Fully ripened claims having accrued more than three years prior to the institution of this suit, the section 349 and 350 claims [under the New York General Business Law] are barred by the statute of limitations."); Argonaut P'ship, L.P. v. Bankers Trustee Co., No. 96 CIV. 1970, 96 CIV. 2222, 1997 WL 45521, at *5 (S.D.N.Y. Feb. 4, 1997) ("This action meets the first prong of the ripeness inquiry [under Abbott Case 1:06-cv-05827-NGG-RML Document 83 Filed 02/23/2007 Page 27 of 42 24 The ESDC defendants offer a few examples of development projects that stalled or were abandoned after the condemning authority issued its Determination and Findings. (See Memorandum of Law of ESDC Defendants in Support of Their Motion to Dismiss the Amended Complaint, dated Jan. 19, 2007, at 14-15.) However, they do not suggest that there is any danger of the Atlantic Yards Project meeting a similar fate. -28- Labs. and its progeny]: it is now fit for review because plaintiffs' claim has accrued and its viability does not depend upon the occurrence of any contingent event."). This makes sense, as both inquiries center around the timing and significance of the plaintiff's injury. See Pearl v. City of Long Beach, 296 F.3d 76, 80 (2d Cir. 2002) (explaining that a claim accrues for statute of limitations purposes "when the plaintiff knows or has reason to know of the injury which is the basis of [her] action.") (internal quotation marks omitted); Dougherty v. Town of N. Hempstead Bd. of Zoning Appeals, 282 F.3d 83, 90 (2d Cir. 2002) ("The purpose of the ripeness requirement is to ensure that a dispute has generated injury significant enough to satisfy the case or controversy requirement of Article III of the U.S. Constitution."). Assessing this case on its unique facts, as the court must, I find plaintiffs' injuries sufficiently concrete to be considered ripe for judicial review. To be sure, the ESDC cannot acquire ownership of plaintiffs' properties until it has commenced an Article 4 proceeding in stat