Sharon Lee, (212) 669-3747 March 19, 2010
ON PUBLIC BENEFIT AGREEMENTS
on a Framework for Public Subsidized Economic Development
NEW YORK, NY – New York City Comptroller John C. Liu today convened the first meeting of his Task Force on Public Benefit Agreements, and charged it with reviewing best practices and drafting a framework on a more effective and equitable process to guide public subsidized economic development projects. The Task Force is a part of the Comptroller’s commitment to examine City development deals that feature specific promises of affordable housing and job creation.
"Public benefit agreements have become more and more prevalent when private developers seek public assistance, from tax subsidies and no-bid contracts to rezonings and invocation of eminent domain," said Comptroller Liu. "It is sensible to have clear standards that ensure benefits for the public when private developers receive benefits from the public. In the absence of clear standards, these agreements will become a problematic bottleneck for future development. Agreements must be enforceable along clear timelines, and should even have clawback provisions to ensure full delivery of promises."
Since initiating the Task Force, Comptroller Liu has expanded its scope from examining Community Benefit Agreements (private contracts between developers and community groups that are difficult to enforce) to public benefit agreements, which include tax subsidies, rezonings and other public resources that are used to facilitate private developments. The Comptroller has asked the Task Force to submit a set of recommendations within six months.
Comptroller Liu first called for the creation of a task force last month, citing a need for more oversight on development projects that consistently fall short of expectations: “The public has seen a series of major promises to communities in exchange for public subsidies. A layer of unpredictability confronts developers when they engage in private negotiations over benefits associated with their projects. In fact, studies have singled out New York City’s community benefit agreements as examples of what not to do. It is time for this embarrassment to end. I will form a task force including business, labor and community representatives that will thoroughly examine the issue of community benefit agreements and propose best practices."
The Task Force will be guided by principles of accountability, transparency, inclusiveness, consistency and fiscal responsibility in:
- Assessing the strengths and shortfalls of recent public benefit agreements.
- Identifying and evaluating best practices to determine how those successes can be transferred to the New York City economic development context.
- Issuing recommendations so New York City can become a model for effective and equitable economic development.
The Task Force includes representatives from the public, business and labor, and will be directed by four Co-Chairs who have demonstrated leadership and commitment in finding innovative solutions to our City’s often intractable economic development problems:
JOHN "JACK" AHERN – President of the New York City Central Labor Council (AFL-CIO), the nation’s largest regional labor council representing over 1.4 million workers. Also Business Manager and Financial Secretary of the International Union of Operating Engineers Local 30, Mr. Ahern has been a union leader for more than 35 years representing the interests of public and private sectors workers and leading the fight for economic justice, fairness and job safety on behalf of the City's workforce.
PRISCILLA ALMODOVAR – Former President of New York State's Housing Finance Agency and the State of New York Mortgage Agency, Ms. Almodovar is now Chief Operating Officer for the Community Development Banking Group at JP Morgan Chase, which extends $5 billion in financing to 85 community development organizations and more than 900 affordable housing and economic development projects across the country.
BARRY GOSIN – Chief Executive Officer of Newmark Knight Frank since 1979. With 6,300 employees worldwide, the firm now operates from more than 200 offices throughout the U.S., Canada, Latin America, Europe, Asia, Africa and the Middle East.
JOYCE MOY - Professor of Small Business Management and Entrepreneurship at the City University of New York (CUNY); and Executive Director of the CUNY’s Asian American/Asian Research Institute (AAARI). Professor Moy, whose field of expertise is economic development and entrepreneurship, has developed programming that is responsive to immigrant, women and minority business owners.
For more information on the Comptroller's Task Force on Public Benefit Agreements, go to: www.comptroller.nyc.gov/pba