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Source: Gothamist
Subject: Housing & Environmental Justice
Type: Media Coverage

Can Willets Point Swap A Mega Mall For Affordable Housing?

This summer, a state court struck down one of the most divisive redevelopment plans of the Bloomberg era. A Citi Field parking lot, on which developers had planned to build a 1.4 million square foot mall where Shea Stadium once stood, was actually park land, and could only be used for stadium-related purposes. A giant shopping mall had little to do with Citi Field, the court ruled, no matter how fervently developers, the owners of the Mets, and the Bloomberg administration argued for it.

The court’s decision gives the de Blasio administration the opportunity to start over on a project that featured massive subsidies for the developers—a partnership of the Mets ownership and the construction and management company Related—while promising very little in return for nearby neighborhoods.

“I think we’re really back to square one,” said John Low-Beer, the attorney who argued the case against the mall on behalf of a coalition of community groups and local lawmakers. “Nothing in the agreement spells what happens now, but it’s possible the entire agreement could be thrown out.”

The Bloomberg administration had chosen the mall plan in 2013, praising the scheme as a workable funding mechanism for the costly remediation of the contaminated Willets Point area, where the city had long neglected to build the necessary infrastructure for the neighborhood, anticipating an eventual clearing of the area for development.

The plan put forward by the developers included a future phase where commercial spaces, and even housing (roughly 2,500 units, 872 of which would be affordable) would be built on the Willets Point site after the remediation, while the mall would be placed on the current Mets parking lot.

In the short term however, the developers had intended to move only the parking lot to the Willets Point site, lowering the potential cost of remediation and building in an opt-out clause where they would have paid $35 million to avoid building any affordable housing at all.

Immediately following the ruling, the de Blasio administration, which had the opportunity to appeal the decision alongside the developers, tried to negotiate a deal more in keeping with the current mayor’s vision for New York City—specifically his Housing New York Plan, which aims to build or preserve 200,000 units of affordable housing over the next 10 years.

Alicia Glen, the Deputy Mayor for Housing and Economic Development, led the negotiations for the city, taking the position that the new administration would join the developer’s’ appeal only if they sped up the timeline for the housing portions of the plan and made them mandatory instead of optional, eliminating that $35 million penalty to get out of their affordable housing obligations. The city wanted housing built immediately after remediation, and were not satisfied to wait until the developers felt the mall was making enough money to fund the construction of housing.

The developers were interested in moving the affordable housing goals forward, but were not convinced the city was offering a clear solution for who would foot the remediation expenses, a spokesperson for the developer told Gothamist.

The negotiations lasted right up until the August 20th deadline, when the city declined to appeal the decision, leaving the developers to go it alone. A judge will decide in the next few weeks whether to hear their appeal.

But according to Low-Beer, the decision confirms that until the state legislature passes any other laws regarding the parking lot, it can either remain one, or revert to park space. That leaves the city focused on what can be accomplished within what remains of the approved plan.

“This is a huge opportunity to build substantial affordable housing,” Javier Valdez, the co-executive director of Make The Road New York, a community group that is active in the Corona area told Gothamist. “It’s a huge canvas to work with. We’ve been trying to lay out the context of what the neighborhood needs, and are ready to discuss this with the mayor as soon as possible.”

In speaking with Gothamist, the Mayor’s Office said that it intends to leave the parking lot be, in favor of focusing on the part of the plan that puts housing on the site of the remaining few auto mechanic shops in WIllets Point, to the east of the stadium. The city has engaged in a long, contentious battle to buy out and evict the mechanic shops, essentially destroying an active business community in the name of redevelopment, spending close to half a billion dollars in the process.

The 62 acre site the city now owns is deeply contaminated with petroleum, cleaning solvents, automotive fluids, and other runoff from at least fifty years of auto repairs on the site. On top of that, the water table at the site is extremely high, meaning the pollution has spread to almost every area of the parcel.

All this means there will be a costly cleanup before any construction can begin. The city had intended for whoever developed the site to pay for it, but the cost and duration of the remediation were never made clear.

“We just don’t know how much the cleanup is going to be, and it could easily end up well north of $100 million,” said Donovan Finn, an assistant professor in the sustainable studies program at Stony Brook University. “They should make sure that no matter what, the financing is in place before the work starts, otherwise the city might be on the hook for a lot of it.”

In the 2013 contract between the city and developers, the cost of the cleanup was anticipated to be $120 million, but in 2008, the city had estimated it to be as high as $570 million, though opponents of the development believe that was a scare tactic by development-friendly councilmembers to get the city to sell the land for as cheaply as possible.

Finn envisions a process where the city deals with multiple developers, instead of one, to get the area cleaned up.

“No matter how ugly the process was, the city now controls that land. They need to find some way to clean up that site with incremental market-based solutions, that maybe doesn’t involve just one single developer with all those incentives,” Finn told Gothamist. “There are very few opportunities in the city like this—so why are we giving it over to one developer, and giving them a massive amount of subsidies to make it work for them? “

The subsidies offered to the developers to get the site cleaned up were substantial, including $43 million in tax breaks. Looking for final approval in 2013, the developers had to earn the support of the area’s councilwoman, Julissa Ferreras. Ferreras eventually won some concessions from the developers on the inclusion of affordable housing (affordable housing was never part of the original plan), and framed the need for the mall as the funding mechanism for and obligation towards remediating the entire site. Still, the $35 million opt-out clause remained, leaving the actual building of the affordable housing far from certain.

“The mall just can’t be built until the land is entirely remediated,” Ferreras told Gothamist last year. “The entirety of the land, not just for the mall.”

But with the mall now all but off the table, it no longer appears that the developers would be able to fund such a huge undertaking. Developers projected the mall, which also featured a hotel, to bring in $150-200 million in annual revenue.

Elena Conte, a Senior Organizer for Planning and Policy at the Pratt Center for Community Development, believes that by cleaning up the site itself, or at least taking more of an active role, the city would be able to reap huge benefits from the market-rate sale of the land, instead of what the current deal entails, which is selling the land to the developers for $1 (and really however many millions the clean-up costs, minus the money the city ends up handing over for cleanup anyway).

“The city should have a very clear, pro-active role in the clean-up,” Conte told Gothamist. “We need public stewardship of the site, not off-handing the responsibility to a developer.”

In an interview with Gothamist, Deputy Mayor for Housing and Economic Development Alicia Glen dismissed the idea that the deal would need to be reopened for public comment or ULURP (the approval process for city projects), and that large parts of the deal could be salvaged, including the housing provisions.

“If you look at the deal that the councilwoman made, it’s a pretty terrific mix of income and units. Could it be tweaked a little? Sure. But the current deal does lay the groundwork for a vibrant community that serves the widest mix of people,” Glen told us.

According to the Mayor’s Office, the current deal still calls for 2,490 total units, with 872 of those units being considered “affordable.” 523 of those units would be for people making 60% of the area median income (for a family of 3, that’s $46K per year), while the rest would be for households making up to 130% median income for the area, which would be $101K for a family of 3. Glen didn’t commit to the Queens Development Group (the name the Related and Mets conglomeration goes by) being the only developer who would be considered.

“If the developers appeal were to be denied, we’re in a situation where we would re-engage with the development team to see whether or not they are prepared to move forward with the project,” Glen told Gothamist. “But if they can’t, or if it’s not financially viable, there’s the possibility of looking at other options. Given the stadium and the proximity to transportation, there’s just a lot of opportunity at that site, and a lot of people are going to be interested in it.”

The Queens Development Group believes that it will be able to move forward with the project as is.

“We are confident that our appeal will succeed, and we are committed to following through on our unprecedented investment in Queens just as the local community board, the City Council and the State Supreme Court intended,” the group said in a statement to Gothamist, “We look forward to building a vibrant new community at Willets Point that will be accomplished by reversing 100 years of pollution, creating thousands of good-paying jobs and growing the local economy.”

Rumors had begun to swirl that other developers looking into the area included a possible stadium proposal from Major League Soccer, who tried and failed to get approval to build a stadium at a nearby site. The Mayor’s Office told Gothamist that despite interest from MLS, a soccer stadium would not be considered for the site.

“Financially, we’re in a much different landscape than we were ten years ago,” said Glen. “The city is spending almost half a billion dollars to make the site development-ready, and the market should be more than able to accommodate both affordable housing and other development on the site.”

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