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Dateline : Thursday, August 04, 2005
Big Man, Small Bid: MTA Gives Ratner 45 More Days
By Emily Keller
Like a garbled subway station announcement, the actions of the MTA's Board of Directors left many Brooklynites feeling frustrated and confused last week.
The board voted 13-1 in favor of a resolution to negotiate solely with Forest City Ratner Company (FCRC) over the next 45 days regarding the company's proposal to build a 19,000-seat Nets basketball arena and residential and retail complex over and around the Vanderbilt Railyards in Downtown Brooklyn, effectively telling the alternate bidder, Extell Development Company, to take a hike.
The board was scheduled to choose a bidder at the July 27 meeting at MTA Headquarters in Midtown Manhattan but was unable to do so because both bids were far lower than the $214.5 million appraised value of the 8.4-acre site. Extell bid $150 million and Ratner bid $50 million.
"The dollars involved with the Ratner proposal are unacceptable," said board member Barry Feinstein.
And a low bidding price is no small matter, said Beverly Dolinsky, executive director of the Permanent Citizens Advisory Committee to the MTA. "You have a fiduciary responsibility to your riders to maximize the income of this sale."
Board members said they had not had time to fully review Extell's last-minute bid, but said it appeared to be lacking in many areas, while Ratner's was only flawed in its bidding price.
Extell's bid was submitted on the July 6 due date, set six weeks after the MTA's Request for Proposals (RFP) was released. The MTA spent two years negotiating with Ratner prior, which critics call a sweetheart deal.
"I think it's wrong to negotiate with only one bidder because both bids are deficient. I am concerned about the exclusivity," said board member Mitchell Pally, the lone dissenting voter.
That exclusivity could botch the Ratner plan, says the community group Develop Don't Destroy Brooklyn (DDDB), which has spent the past two years resisting Ratner's plan to use eminent domain to acquire 13 additional acres for his arena. Eminent domain, or the acquisition of private property for public benefit, could be denied by the Supreme Court if FCRC was chosen as the "preferred developer" of the site, said DDDB's volunteer attorney, Candace Carpenter.
Of the 53 speakers the board listened to, most spoke vehemently for or against the Ratner plan, but a few also raised the question of whether the MTA was over-stepping its boundaries in being asked to evaluate what is best for the community, and said it should only act in the interest of receiving the highest value for its site, for the benefit of its riders.
"It is not our responsibility to make the determination of what to build there," said Pally, adding that the decision should be left up to City Council, the borough president, and others.
Developments of city land are legally required to go through the Uniform Land Use and Review Procedure (ULURP), making them subject to the oversight of city officials and to environmental impact studies, including traffic analyses. But Ratner said his project will not go through ULURP because the land is technically state-owned. Extell said it would go through ULURP.
The inadequacy of the MTA, as an agency, to make such high-impact decisions for the life of a development project could be seen in its inability to seat and hear all of the intended public speakers, who would normally descend on City Hall and Brooklyn Borough Hall for such monumental debates. The 9:30 a.m. meeting was filled to capacity shortly after 9 a.m., leaving the rest of opinionated Brooklynites out in the heat.
"It is not within your jurisdiction to award eminent domain," noted Michael Decker, who equated Ratner's project with a "Robert Moses-era mega-project."
The Ratner plan is supported by Mayor Michael Bloomberg and Governor George Pataki, who appoint the MTA board members, making the decision a political one.
Without city officials taking charge, the community is left to fight amongst itself. "This has been one of the most divisive struggles that we've had in this community. We've never been divided by race, by class, or by income before," said State Senator Velmanette Montgomery (D-18). "I'm ashamed of what has happened in my neighborhood and my district. I'm very sad about it."
But another speaker countered that Brooklyn has always been divided - between the haves and the have-nots - and Ratner is closing that gap.
Despite the common goals of the community: affordable housing, job creation, and the preservation and improvement of quality of life, the battle lines have been drawn.
Those in favor of the Ratner plan are citing a historic opportunity for African-Americans to become empowered, as promised by a binding Community Benefits Agreement (CBA) signed June 27 by FCRC, Public Housing Communities (PHC), Brooklyn United for Innovative Local Development (BUILD), and many more.
"No longer do young Black men have to stand on the corner and speculate about what's happening - we are at the table and we are being treated fairly," said James Caldwell, president of BUILD, about Ratner's visits to the community during the creation of the CBA. "FCRC is truly like an angel in heaven."
The CBA pledges to make 50 percent of new residences affordable, use all union construction, and award $750,000 worth of construction contracts to minority- and women-owned businesses. But critics say the numbers are skewed and only 30 percent of residences will be affordable - the same percentage that Extell is promising.
"My neighborhood is dying for this arena. They need the jobs bad," said Anthony Taylor, president of the Betterhood Pacific Street Block Association.
And they need those jobs fast, Ratner proponents said, urging the board not to delay its vote. "To delay this vote is to delay a season of sordidly needed opportunities," said Marie Louis of BUILD.
"It is critical that we move on this quickly. We need to get this arena going and this development going. The 2009 season could be jeopardized," said Jim Stuckey, executive vice president of FCRC.
But Ratner opponents encouraged the board to postpone its vote in hopes that Extell will improve its bid.
DDDB spokesperson Daniel Goldstein also pointed out that the development would be held up by an eminent domain lawsuit the group plans to file. "You want expediency with whatever is built there. There will be no expediency."
"Time is of the essence. The community deserves an answer. But it deserves the right answer. We have no assurance that they're going to come up with one more cent," said Pally about FCRC.
"Ratner is not just a builder. He has a big heart," said another Ratner-proponent and representative of BUILD. "God has sent someone like him to help us."
The question remains why such a generous, experienced and knowledgeable business man would submit such a low bid.
The next MTA board is scheduled for 9:30 a.m. on September 29, at which time Ratner is expected to have upped the ante or else. "Extell should clarify the details of their bid in the meantime," said Feinstein.
The meeting takes place at 347 Madison Avenue between 44th and 45th streets, 5th floor boardroom. For information call (212) 878-0219.

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