Forest City Ratner’s controversial 22-acre Atlantic Yards mixed-use project in the heart of downtown Brooklyn cleared another hurdle last week. On Dec. 8, the Empire StateCorporation, New York’s economic development agency, approved the general project plan and the use of eminent domain for the complex. If Forest City Ratner clears the remaining development hurdles, up to 60 local properties and 12 small businesses will be seized under the power of eminent domain.
Yet it probably won’t play out that smoothly.
“These things can drag on for years and, unfortunately, around the country these sorts of lawsuits have caused well-intentioned urban renewal projects to die by the thousands,” says Ted Zangari, a lawyer with the New Jersey-based Sills Cummis Epstein & Gross P.C.
But even though the site on which Forest City president Bruce Ratner plans to build his arena has been considered under-utilized for more than half a century, according to New York public officials, including Brooklyn Borough president Marty Markowitz, the development has met with fierce opposition from local residents. In the three years since the plans for Atlantic Yards were unveiled, there have been accusations of favoritism on the part of public officials who granted Ratner the redevelopment bid and several lawsuits, including one challenging the need for demolition of several Ratner-owned properties located on the site and a more recent one charging illegal use of eminent domain.
In addition, Develop Don’t Destroy Brooklyn, one of the community groups that has led the opposition to Ratner’s plan, is planning to challenge the Environmental Impact Statement on Atlantic Yards that was released last month. That means that while Ratner needs only one additional public approval – from the Public Authorities Control Board, set to vote on the issue on Dec. 20 – the start ofmight be years away.
By the admission of Develop Don’t Destroy Brooklyn spokesman Daniel Goldstein, Ratner has tried to work out a financially fair settlement with the remaining homeowners and tenants at Atlantic Yards. But for many of those involved in the current lawsuit, the issue is a matter of principle, as they believe that the area can still be redeveloped without the use of eminent domain.
“Just because Bruce Ratner wants to take your property doesn’t mean you have to negotiate with him,” Goldstein says. “We are not against redevelopment – nothing could be further from the truth – but we found a developer [Extell Development Company] whose proposal was for a very dense project that would not use eminent domain.”
Extell’s redevelopment plan called for the creation of 11 residential buildings and small scale retail on the site.
Forest City Ratner and Extell Development Company were the only two companies that responded to the New York City Metropolitan Transportation Authority’s Request for Proposals in July 2005.
But New York public officials, including Governor George E. Pataki and Mayor Michael R. Bloomberg have been supportive of Ratner because of the economic benefits he has promised to deliver. Forest City Ratner estimates that the $4 billion development will create 22,000 construction jobs, 5,000 permanent jobs and up to $6 billion in revenues for the city and state over a 30-year period. In addition, Ratner promised to deliver eight acres of open public space and 2,250 units of affordable and market-rate housing to ensure support for his project. The city and state will each contribute $100 million to the development to pay for land costs and infrastructure.
Meanwhile, the plaintiffs in the eminent domain suit are asking the court to postpone the vote by the Public Authorities Control Board until the suit is resolved – a process that will last well into 2007. Forest City Ratner’s website lists the expected groundbreaking date for Atlantic Yards as late 2006, with completion scheduled for 2016.
Forest City Ratner is pushing for use of eminent domain despite it being a political hot button. Congress had been considering legislation barring the use of eminent domain for economic development nationwide. The measure passed the house, but was not brought to a vote in the Senate before Congress adjourned. In November, referendums passed in nine states barring use of eminent domain.