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We Got 'Kick in the Face' From Mayor in Spofford Deal: Minority Developers

By Jeff Mays | October 28, 2016 3:44pm | Updated on October 31, 2016 9:23am
 The city plans to transform the Spofford Juvenile Detention Center into an affordable housing complex.
Plans for Spofford Juvenile Detention Center
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SOUTH BRONX — Community and business leaders in the South Bronx say the decision to hire non-minority developers for a massive $300 million project to turn the notorious Spofford Juvenile Detention Center into affordable housing and manufacturing space flies in the face of Mayor Bill de Blasio's recently announced plan to award more city contracts to minority and women-owned businesses.

"The mayor says it's the 'Tale of Two Cities' and that he wants to address economic justice issues but he hasn't done that," said Frank Garcia, chairman of the board of the National Association of Latino State Chambers of Commerce, and a former South Bronx business owner. "To not hire a minority firm and to bring white-owned firms in from the outside is a kick in the face to the South Bronx."

The Economic Development Corporation announced that a joint venture between Gilbane Development Company, Mutual Housing Association of New York and Hudson Companies has been awarded the project to build 740 affordable housing units, a new public plaza, 21,000 square feet of ground floor commercial space, and 49,000 square feet of light industrial use space.

EDC officials say that the winning consortium, known as The Peninsula, LLC, has committed to a goal of hiring 35 percent minority and women subcontractors and includes anchor tenants for the project that are also minority and women-led, although none have an equity financial stake in the project.

"The Peninsula will be a community for the people, and built by the people as it will be anchored by numerous MWBE Bronx-based businesses that want to grow here and create more jobs here," said Maria Torres, co-founder and executive director of The Point, a group working to revive Hunts Point.

But South Bronx stakeholders opposed to the city's choice of developer say that if a minority developer can't be chosen in a neighborhood that is 97 percent black and Latino, they don't have much faith in the city's ability to achieve its stated goal to award 30 percent of citywide contracts to MWBE developers by 2021.

"This action by de Blasio continues the narrative of inequality. It says blacks and minorities in the city should not expect to do business with the city," said the Rev. Johnnie Greene, a Harlem pastor who heads the statewide group Mobilizing Preachers and Community.

De Blasio ran for office on a platform of addressing economic inequality. But as he has focused on issues such as raising the minimum wage and universal pre-K, critics say he has failed to address one of the most basic ways of increasing economic prosperity — supporting locally owned businesses headed by minorities and women.

In 2015, a report from Comptroller Scott Stringer gave the city a D+ for awarding only 5.3 percent of its nearly $14 billion in contracts to MWBE firms. Companies owned by blacks and Latinos received only 2 percent of city contracts. Gov. Andrew Cuomo set a goal of awarding 30 percent of state contracts to MWBE firms in 2014.

The mayor's minority and women contracting record is likely to be an issue in his upcoming re-election effort. De Blasio's strongest supporters are voters in the African-American and Latino communities.

Already, Stringer, cited as a potential candidate for mayor in 2017, has said de Blasio has moved too slowly to address inequality. Real estate developer Don Peebles, also a potential mayoral candidate and former de Blasio donor, has said black New Yorkers should reconsider their strong support of de Blasio over MWBE contracting.

Greene and his group have begun working against de Blasio's re-election effort because of the issue and are now considering a discrimination lawsuit to stop the Spofford project from moving forward.

One of the developers who was rejected for the Spofford project was headed by Majora Carter, a respected South Bronx advocate.

Carter partnered with well-known development groups L+M, BRP and Habitat for Humanity to present a project called Hunts Point Heights that would have created 1,200 units of housing, 95,000 square feet of manufacturing space, 39,000 feet of commercial and retail space and 77,000 square feet of community and retail space.

The group said their proposal would create over 700 jobs. The project also included a higher mix of incomes than did the winning bid.

"If Majora had been able to secure that project in the South Bronx it would have represented a paradigm shift of how business is done in the city," said Larry English, chairman of AirRail, a minority-owned infrastructure development firm.

Carter said the city's choice of a developer was "typical."

"The lack of diversity on the team chosen by NYCEDC to develop Spofford is not indicative of Mayor de Blasio’s much publicized commitment to including minority businesses in the city’s contracting," she told DNAinfo. "Instead EDC selected a typical team composed exclusively of white men 'partnered' with uncompensated minority nonprofits to whom no transformative capital benefits will accrue."

City Hall sources familiar with Carter's proposal say it was too high density for the area, which was a concern of local residents.

The proposed income levels of Carter's project included 80 percent of units being affordable to those making 80 to 130 percent of area median income. The winning bid features AMI levels of 30 to 90 percent with 80 percent of the project at less than 80 percent of AMI.

In New York City, 80 percent of AMI is $86,976 for a family of four.

City officials also felt that Carter's proposed industrial uses "lacked clarity" and that there were concerns about the group's ability to deliver on time.

"Opposition to the project is being largely driven by a losing bidder who offered a proposal that simply did not meet the needs and wishes of the community," said Raul Contreras, a spokesman for de Blasio.

Carter dismissed those criticisms, saying many of the issues could have been worked out during the land review process, as is the norm.

"With the newly awarded proposal, EDC continues to concentrate poverty, refusing to make space in the community for a wider range of workforce, like teachers, health care workers, and public servants to live in the Hunts Point community," Carter said.

Eva Sanjua, a Hunts Point resident since early childhood, is a homeowner and member of the Hunts Point Advisory Board. She said Carter's proposal made her hopeful for the future of the neighborhood.

"I'm tired of seeing 99 cent stores. Don't look at Hunts Point like we are all poor," Sanjua said. "There are a lot of educated people in this community and a lot of good people that would love to find good jobs."