Gray Wolf's Howl: New York State Agency ‘Adopts’ Columbia University’s $6.3B Mixed-Use Expansion

New York State Agency ‘Adopts’ Columbia University’s $6.3B Mixed-Use Expansion
[July 21, 2008]

By Alex Philippidis

Opponents of Columbia University’s planned $6.3 billion mixed-use project — set to bring nearly 2.6 million square feet of new research lab space to Manhattan’s West Harlem — last week lost one battle against the state’s economic-development agency, but won another in their effort to stop the development.

At a July 17 meeting in New York, the board of the Empire State Development Corp. “adopted” the general project plan for Columbia’s expansion a half-mile northwest of its main campus in Manhattan’s Morningside Heights section, into a 17-acre section of West Harlem that retains its 19th century name of Manhattanville.

ESDC’s action allows a future public hearing on the general project plan. The agency will schedule at least two hearings starting in September — the dates and times had not been announced at deadline — at the request of elected officials representing West Harlem. After those hearings, ESDC’s board will either approve the original plan or request changes reflecting comments made at the hearing.

Avi Schick, ESDC’s president and chief operating officer, defended the agency’s review of Columbia’s mega-project, as well as the state’s refusal to rule out using its power of eminent domain to condemn properties whose owners have refused to sell to the university.

“Eminent domain is an important and necessary economic-development tool that must be used carefully and sparingly. We understand the passions it raises, and we understand the concern that people articulate,” Schick said at a Q&A session with reporters held after the board met at ESDC’s midtown Manhattan offices. “It’s our job to walk that fine line so we can do what’s appropriate.”

The board adopted the project by a voice vote that drew no objections from directors. The vote took place about an hour after several residents, neighborhood groups, one elected official, and a business owner who has sued Columbia to stop the project urged all ESDC to hold off on an approval.

“I had been hopeful that either the state or Columbia would do the right thing and remove the ugly threat of condemnation from the Columbia expansion project. With [last week’s vote] by the state, the reality has pretty much set in that this will not happen,” said Nicholas Sprayregen, owner of Tuck-It-Away, a regional chain of self-storage sites. “As a result, I am more determined than ever to fight this abuse through the courts of this state, and of the country.”

Tuck-It-Away operates four self-storage sites in West Harlem, as well as eight others elsewhere in New York City and one across the Hudson River in Newark, NJ.

ESDC’s new chairman Robert Wilmers, who took office last week, told reporters after the vote that he supported the state having the eminent domain option in the Columbia project, but added that did not weigh in on the agency’s review of the university project.

“Being in the job for four days, I don’t think it’s my role to try and re-think what many people have spent a lot of time and effort on,” said Wilmers, the chairman and CEO of Buffalo-based M&T Bank, one of the nation’s 20 largest commercial lenders with $66 billion in assets.

Wilmers was named to his ESDC last month by Gov. David Paterson to oversee a restructuring of the agency, which has suffered from turf battles and growing inefficiency in the 18 months since it was divided into separate upstate and downstate fiefdoms by Paterson’s predecessor, Eliot Spitzer. [See Around the Regions, this issue].

In their voice vote, three members of ESDC’s board of directors sided with Columbia’s arguments that the project offered the best prospects for the university to address what it has said are shortages of laboratory and classroom space within its 36-acre Morningside Heights campus at a time when several of its programs are growing.

“[The project] would maintain the status of the city and state of New York as centers for higher education, for new graduate programs and scientific research, [and] allow Columbia to maintain its position as one of the foremost educational and cultural institutions in the world,” ESDC concluded in a findings statement.

Columbia was approved late last year to build a total 6.8 million square feet of space, including nearly 2.6 million square feet of new research lab space and 296,201 square feet of support space. Columbia has said it needs the new space to compete better with other top-tier research universities for researchers, and to accommodate several growing programs unable to expand within its existing 36-acre Morningside Heights campus.

“I’m angry that I have to wake up each day fighting on behalf of my family to keep what is lawfully ours. I’m angry that I have to fight the attempt, in broad daylight, of Columbia taking what does not belong to them.”

Those programs include the Jerome L. Greene Science Center for Columbia’s Mind, Brain and Behavior initiative, which would find a permanent home within part of the 351,310 square feet of lab space slated to be built in the project’s first phase, slated to wrap up in 2015.

In its General Project Plan, available here, Columbia said its project would generate 14,000 construction jobs between 2008 and 2033, when “approximately” 6,000 permanent university jobs are expected, not counting an unspecified number of retail and neighborhood services employees to be based on the ground floors of the project’s 17 planned buildings.

The permanent jobs “and other project-related employment” would generate “in excess of” $2 billion in personal income, $168 million in state taxes, and $74 million in state taxes between 2008 and 2033, the GPP concluded.

Columbia’s figures vary from those furnished to New York City officials just last fall. While the university attributes the differences to the use of different economic models in reports it submitted to the state and city, the parameters of both reports also vary, complicating a comparison of the two.

The university’s final environmental impact statement submitted to the city planning commission does not measure jobs and taxes on a cumulative 2008-2033 basis. Instead, the FEIS concluded the mega-project would generate:

The equivalent of 1,200 construction jobs each year for 22 years between 2008 and 2030, or 26,732 jobs;
6,399 permanent jobs within Columbia's mixed-use project, plus another 687 just outside but still within the expanse rezoned by the city last December, with the project in mind;
Another 3,960 permanent jobs within New York City, a parameter not in the state study; and
$2 billion in economic activity, another measure not included in the state study.

The total project cost has also been revised down to $6.28 billion, exclusive of financing costs, from an earlier $7 billion estimate — even as the construction cost has been kicked up to $6.2 billion, from $5.8 billion in the city FEIS [BRN , Dec. 17 2007].

The prospect of thousands of new jobs and millions of dollars in new taxes, plus Columbia’s status as New York City’s seventh-largest private employer with 14,000 employees, has helped the project win key political support, including US Rep. Charles Rangel (D-Harlem) and Mayor Michael Bloomberg, who sent ESDC a letter backing the project.

“The project promises considerable long-term economic, educational, and civic benefits to the state and city of New York,” Bloomberg wrote.

The City Council late last year rezoned 35 acres, including the 17 acres Columbia would redevelop, by a 35-5 margin with five abstentions [BRN , Dec. 31, 2007].

Columbia is also touting agreements it reached with some West Harlem civic leaders and elected officials to spend millions of dollars on community projects recommended by groups that negotiated with the university.

Schick said ESDC had persuaded Columbia to spend another $20 million on projects to be decided by the Harlem Community Development Corp., a state redevelopment agency; and $1 million toward health sciences and medical technician training by the City University of New York.

Columbia also promised ESDC that it would fulfill a goal that 40 percent of the project’s construction work force consist of women and minorities, as well as spend millions of additional dollars on a variety of other community projects that include a shuttle bus linking the neighborhood and Columbia’s main campus, for senior citizens and people with disabilities; a mobile dental center for pre-schoolers; new space for programs serving seniors; a new disease education center for children; as well as “40 to 50” annual scholarships for youths and seniors, including tenants of nearby housing projects, for programs ranging from summer camps to evening classes.

Asked by BRN to quantify the cost, Schick replied: “Over time, it’s certainly an eight-figure sum. It’s a very substantial number.”

“We spoke to those in the community, the electeds and others, and asked, ‘What would make sense? What would work? What would help knit together this project into the fabric of the community,” Schick said. “This is really one neighborhood and one community; it’s not the campus, and then the residents. We wanted to integrate them as one.”

Those community benefits projects would be in addition to other Columbia commitments that include:

A $20 million fund to finance below-market “affordable” housing for West Harlem residents, $11.25 million toward upkeep of a new waterfront park for 25 years, and $4 million toward legal aid for tenants facing eviction or harassment by their landlords. Columbia promised to fund all three following talks with Manhattan Borough President Scott Stringer; and
Another $76 million in neighborhood projects, under a deal brokered in December between the university the public-private West Harlem Local Development Corp., and several elected officials by City Council Speaker Christine Quinn, a Democrat and potential candidate in next year’s mayoral election.

The LDC’s decision to negotiate with Columbia without insisting on the university accepting an alternative land-use plan supported by critics of the Columbia project prompted Sprayregen and four other members of the development corporation board to resign in protest.

The critics insist Columbia should conform to a land-use guideline developed by Community Board 9 Manhattan, which serves West Harlem, under 197-a of the New York City Charter. The 197-a plan would have barred eminent domain and limited new academic research to a center for clean manufacturing or “Zero Waste Studies.” Columbia has opposed the 197-a plan, saying it would allow the university to build only 662,000 square feet of facilities, but no lab space.

Condemning Condemnation

Columbia’s general project plan would allow the state to condemn five properties whose owners have refused to sell to the university — a sore point with critics of Columbia’s project, who vowed last week to stop the state from using eminent domain in their neighborhood. To date, the university has reached agreements with property owners to acquire some 80 percent of the 17 acres it has slated for redevelopment.

La-Verna Fountain, a Columbia spokeswoman, told reporters after the meeting that the university continues to pursue talks for the properties not under its control, while its consultants develop drawings for the planned new buildings. She said the university would make additional comments in a forthcoming statement that had not been released at deadline.

Four of the five parcels not controlled by Columbia are owned by Sprayregen; the other parcel is a service station on West 125 St.

Sprayregen’s Tuck-It-Away Associates LP earlier this year sued the university, the city, and three of its boards, with the goal of stopping the project on environmental review grounds [BRN , March 31].

On July 21, state Supreme Court Justice Jane Solomon was due to decide whether to request additional oral arguments at a later date, in addition to the written reply to Columbia’s response to the original suit, said a lawyer representing Tuck-It-Away in the environmental-review lawsuit, Steven Silverberg of the White Plains, NY, law firm Silverberg & Zalantis. The case is known as Tuck-It-Away Associates LP, et. al, vs. City of New York, et. al (Index No. 104415/08).

It will be the latest skirmish in Sprayregen’s four-year fight against the Columbia plan.

“I’m angry. I’m angry that I have to wake up each day fighting on behalf of my family to keep what is lawfully ours. I’m angry that I have to fight the attempt, in broad daylight, of Columbia taking what does not belong to them,” Sprayregen said.

‘Layers of Conflict’

Tuck-It-Away this week prevailed in a separate court battle related to Columbia’s project — a two-year-old lawsuit against ESDC seeking access to communications between the agency and the consultant it hired to prepare the first of two studies concluding the West Harlem site Columbia wishes to redevelop was blighted, thus warranting state use of its eminent domain power.

That consultant, planning firm AKRF, is also a consultant to Columbia — a situation Tuck-It-Away and another plaintiff, the West Harlem Business Group, contend poses a conflict of interest that taints the original blight study. In it, AKRF concluded that the project site consists mainly of “aging, poorly maintained and functionally obsolete industrial buildings with little indication of recent reinvestment to revive their generally deteriorated condition.”

Two days before the ESDC adopted Columbia’s project plan, the New York State Supreme Court-Appellate Division, First Department, upheld a key portion of a year-old lower court decision ordering the release of e-mail correspondence between the state agency and Columbia’s planning consultant for the West Harlem project.

The appellate court upheld the state Supreme Court’s finding that ESDC must make public its correspondence with AKRF, agreeing with the lower court. ESDC had cited an exemption in state law it said allowed it to withhold the correspondence because it would impair present or imminent contract awards, or collective bargaining negotiations — one of several categories of intra- and inter-agency correspondence exchanged for discussion purposes that is exempt from disclosure.

Both courts disagreed with the state agency.

“The gargantuan size of the project, the layers of conflict between Columbia and ESDC, and the difficulty of offering perfectly objective advice while serving two masters elevates this FOIL [Freedom of Information Law] appeal beyond the average agency-consultant relationship that the FOIL exemptions are designed to foster and protect,” the appellate court ruled in Matter of Tuck-It-Away Associates L.P. v. Empire State Development Corp. (2008 NY Slip Op 06279), available here.

“We agree with [the] Supreme Court and hold that such a relationship creates an inseparable conflict for purposes of FOIL, and therefore for the purposes of invoking the agency exemption,” the appellate court concluded.

However, AKRF and ESDC prevailed over Tuck-It-Away and another plaintiff, the West Harlem Business Group, when the appellate court exempted from disclosure two categories of ESDC correspondence the lower court had ordered released in its original decision in May 2007.

Remaining exempt are intra-agency communications concerning how ESDC should respond to an inquiry from a member of the public about its role in the proposed project, and e-mail messages discussing the scheduling of meetings involving the project.

In its majority decision, a four-judge panel of the appellate court justified keeping those categories exempt by citing a recent decision from New York’s highest court, the state Court of Appeals.

“Opinions and recommendations that would, if prepared by agency employees, be exempt from disclosure under the Freedom of Information Law (FOIL) as intra-agency materials do not lose their exempt status simply because they are prepared for the agency, at its request, by an outside consultant,” the Court of Appeals stated.

Norman Siegel, a lawyer for Tuck-It-Away, told BRN last week the appellate decision set a precedent extending the reach of the state Freedom of Information Act by increasing access to government records for development applications.

“It also raises the specter of whether or not the ESDC process up to date is tainted,” Siegel said.

An example of that taint, Siegel said, would be AKRF’s criteria for determining blight, which included underuse of properties. A one-story building on a parcel allowing two-story buildings could have been defined as underused: “By definition, any one-story building, even if it’s structurally sound, would be blighted under their methodology.”

Siegel said the appellate decision could help Sprayregen and Tuck-It-Away beyond the government-records case — if, as he expects, ESDC ultimately approves the project plan later this year. New York state law directs appeals from eminent domain decisions be filed with the appellate division.

“We’ll be on the eminent domain track by the end of the year. And the eminent domain track could go all the way to, and include, the [US] Supreme Court,” Siegel told BRN after the ESDC vote.

Second Study

At the board meeting, Schick said ESDC had complied with the decision — and disclosed for the first time that the AKRF study wasn’t the only basis for finding Columbia’s project site to be blighted. He said ESDC earlier this year commissioned a second blight study — technically an audit of the AKRF report — by a consultant with no apparent tie to Columbia, Earth Tech, a study that came to the same finding as AKRF’s.

That disclosure touched off a heated five-minute exchange during the board meeting between Schick and a state Senator who represents the project site and several nearby neighborhoods.

State Sen. Bill Perkins (D-Harlem) angrily asked Schick why he failed to disclose the Earth Tech study during any of a dozen phone conversations the two men had stretching back weeks. The day of the board meeting, Perkins was quoted in the New York Sun newspaper as saying a second study should be undertaken.

“If I had known before I was interviewed that a second study had already been done, I would have hoped that I had seen it before this particular hearing. Why was not I told that such a study was in the works?” Perkins asked.

“Senator, with all respect,” Schick began.

“With all respect? You’re now starting to pay respect?” Perkins shouted.

Schick replied by acknowledging the topic had not been raised during their conversations, without elaborating why. Schick remained mum on the question when asked by BRN during the press Q&A why Perkins wasn’t told about the Earth Tech report.

Perkins — the ranking minority party member on the state Senate Committee on Corporations, Authorities and Commissions — told BRN after the meeting his panel was organizing a task force to examine the state’s use of eminent domain, with an eye to possible reform proposals.

“You have to restore faith in this type of process if we’re going to keep it. You cannot run roughshod over communities and get bonding opportunities, and have the community not feel as if their interests are being met,” Perkins said.

However, several bills that would limit the use of condemnation have stalled in the state Legislature since the US Supreme Court’s Kelo v. City of New London decision, 545 U.S. 469 (2005), which allowed the general benefits a community enjoys from economic growth as a permissible "public use" that warrants the taking by governments of private land for use by another private owner.

Answering other BRN questions, Schick said ESDC commissioned the Earth Tech report because two years had passed since the AKRF report, and the agency wanted to ensure its blight finding reflected more recent conditions.

“As the timelines lengthened, we said, ‘Why not go back and look again and see if we get the same results with somebody else?’ And we did. I think that’s a positive development. Some of the [elected] officials said we should do a second study, and we have,” Schick said. “It’s always good to have more eyes looking at it than fewer eyes looking at it.”

Schick denied the second study reflected concerns by ESDC about the AKRF study stemming from the litigation by Tuck-It-Away and the business group.

That litigation ended July 15 with the appellate court’s 14-page decision, issued by a majority of the four-judge panel led by presiding judge was Richard Andrias. Concurring fully with Andrias were appellate court judges James Catterson and Eugene Nardelli. The fourth judge, John Buckley, offered a two-and-a-half-page dissent that disagreed less with the majority’s decision than the reasoning behind it.

Buckley argued the majority interpreted the freedom of information law too broadly, so that someday FOIL applicants could force disclosure of agency-consultant correspondence just by alleging bias. The court should instead weigh whether the consultants in question “were the most qualified, lacked an actual conflict or bias, or gave the best possible advice.

“The result would be to deter agencies from eliciting recommendations from consultants and to inhibit good-faith consultants from rendering frank advice; that in turn, would negatively impact on the quality of agency decisions,” Buckley wrote. “I believe that the majority’s ruling will ultimately harm the quality of agency decisions.”