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WPCNR NEWS & COMMENT. By John F. Bailey. March 5, 2010. (The following is adapted from a public appearance and presentation at the White Plains Downtown Neighborhood Association February 27.):
What was White Plains like ten years ago?
Tishman Speyer was Mayor Delfino’s first choice to reinvigorate the shell left by Macy’s closing, but they had pulled out after Tishman Speyer’s movie tenant, Leows had departed due in part to a mysterious lawsuit filed by clothing merchant and horse racing enthusiast who filed a lawsuit which threatened to delay Tishman development of the empty Macy’s site. This mysterious suit was dismissed, but not before the movie tenant, Leow’s, condition had deteriorated financially and withdrew.
Mr. Cappelli would show an enthusiasm to move ahead similar to that of Robert Moses’ philosophy of “getting that first stake in” when attempting to get a project approved. That City Center plan was approved by the Common Council in fall of 2001 after considerable architectural change, engineered by intense lobbying of the Common Council by the populace.
During that first year of WPCNR – Bank Street Commons, the first effort of the Delfino Administration was approved—the first to include required affordable housing component. It was the beginning of the Renaissance.The approval of the City Center in 2001 eventually brought Fortunoff to town in 2003.
The Renaissance was in full bloom.
What was not approved — significantly — was a Delfino administration plan with New York Presbyterian Hospital in which the city would receive 60 acres of hospital property for a “central park” for White Plains, if the city would allow more commercial development of the Bloomingdale’s area. WPCNR covered this extensively, and here the forces against the commercial development prevailed.
An unfortunate trespass incident by a mysterious person WPCNR dubbed “The Toxic Avenger” while this plan was being debated forced the hospital to close its grounds to the public for good to the people of White Plains.
Eight years later those grounds are still closed.
As a result of that turn down of the 60 acres not even to refer it out, the city bowed to a threatened subsequent lawsuit by the hospital and was forced eventually to consider and approve a proton accelerator project for the park property, however the New York Presbyterian Hospital never received committed funding for the technology and that project was never built.
The significance of that New York Presbyterian Hospital saga was that it demonstrated the vulnerability the council exposes itself to, when it makes decisions based on politics, friendships and popular misconceptions. It creates precedents that threaten zoning and the city standards.
Threats of lawsuits and creation of precedent setting zoning decisions followed as a result of this attitude by the common council, they consistently set themselves up in weak legal positions, to the extent that now site plans go on for years without starting. Land is banked by developers who don’t start projects crying poverty.
Also on the conservation front, a direct result of the hospital decision was the concept of buying land for conservation of open space which the city spent money on. Land was acquired for Liberty Park, with the county buying part of the land in return for a housing development.
The city spent $600,000 to create Liberty Park which has now due to an unforeseen algae growth problem in the lake created a park no one uses. The algae was thought by some experts to be caused by the fertilizer run off from the park grass.
Land was acquired adjacent the Greenway for city money which also stopped possibility of development.
However, the council also sold off land to favored developers adjacent the Greenway in what amounted to a very mixed message.
Now the city has a net result of the hospital property still not accessable by residents, and virtually no plans yet to work out a way the city could again access that New York Presbyterian Property.
With the opening of the City Center in 2003 – White Plains entered a brief renaissance, culminating in 2005-2006 when the City Center was at its most successful – but still the sales tax did not reach the levels expected of it though they did hit a high of $44 Million last year up from $34 Million before the City Center opened.
New condominium and retail projects were approved on Maple Avenue, and the Church and Barker Avalon Bay complex approved and built. The JPI townhouse and condominium project was approved and has proved successful as has Avalon Bay on Barker Avenue, but as I write, the two Maple Avenue projects, the Church and Barker condo have yet to be started. Site plans are consistently being extended by the Common Council and even for unprecedented lengths of time, creating precedents that may come home to roost in the future.
The idea of the PILOT, payments in lieu of taxes, has come under fire. The city used PILOTS to offer carrots to developers like Mr. Cappelli to make developing attractive. Whether Mr. Cappelli would have developed with higher PILOT payments is moot.
The city also drew another project from Louis Cappelli the 221 Main Project that the city approved in 2004, with a zoning change that allowed extension of zoning to adjacent lots, a key change that facilitated the 40 story now Ritz-Carlton and Condominium towers. Also approved is the Venue near Fortunoff . That stands stalled out at this point.
The city thanks in part to WPCNR reporting eventually convinced Cappelli Enterprises to line the sewer line to accommodate City Center and 221 Main future sewage at the suggestion of the Commissioner of Public Works to prevent an overflow problem, and construct a supplementary “Nicoletti bypass sewer line to take the effluent load off the Main Street sewer.
A tip of that hat goes to Susan Elan, former Journal News White Plains reporter for her routine FOIA of city records and communications, involving the sewer line which revealed the “stinking memo” (as opposed to “smoking gun,”) from Commissioner Joseph Nicoletti where Mr. Nicoletti predicted catastrophic overflows if the Main Street sewer alone served both 221 Main and the City Center.
An interesting aside on the Nicoletti memo: the comments were in the original legislation approving the the project, but the Common Council apparently missed it, as did the media, including yours truly.
Initial sales for the condominiums at the Ritz Carlton were remarkably strong in 2005-6, but now 38 of those units are being offered for sale in a package at about $600,000 apiece, the project is perhaps victimized by the burst of the real estate speculation that collapsed in the last two years. Planned condominium projects are not being started because no market is available to buy the condos.
Even 55 Bank Street another model affordable housing, retail apartment complex is stalled at this time due to the paralysis of the financial markets – but not before the city granted them a PILOT, and sold the land for the building to them without putting it up for auction first – now that project is stalled.
The affordable housing restriction in which developers have to devote 10% of their units to affordable housing is another good-intentioned council policy that evolved because it was popular and “the right thing to do.”
Whether this will be a roadblock to future development remains to be seen. My guess is it will be. Who wants to build affordable housing in this economy?
The city government also changed primarily in union contracts that routinely followed the steady 3 to 4% inflation rate. That has now come back to haunt the city as inflation has ground to a zero rate. But soft negotiating with municipal unions is a pattern you see across the state. Politicians in power have no stomach for negotiating hard with unions and inflation rarely dictates the union settlements.
Sales Tax receipts have declined thanks to the economy, and perhaps White Plains parking policies possibly keeping customers out of White Plains, and city revenues have fallen from the real estate bust too.
The government also, to fund those union contracts went to raise sales taxes and also created the Department of Parking to access the Parking Authority surplus to handle general fund expenses. I can not speak for the thinking behind this, but they were confident that the money used to pay for spending on increases in public safety, fire, and city expenses, would eventually come in as the economy expanded ever onward, driving up the sales tax.This is a simplification of what happened.
It has not worked out that way.
My friend Peter Katz whom I do the WHITE PLAINS WEEK television show with – told me just today real estate values in White Plains have fallen to prices of fifteen years ago.
What White Plains faces as a result of the national financial debacle, is a shattering of the upward mobility concept where people believe in the future, will extend their own personal risk to buy a better standard of living, confident they will be able to grow in their income and handle the debt of acquiring better places to live.
When the consumer loses that belief in the future, economic stagnation sets in. It has happened in just three years. From the soaring real estate values of 2005-6 we now see a 10% reduction in the value of the typical White Plains home – and that is a home priced in the $650,000 range. Condominiums are worth much less and are simply not selling.
Where does White Plains stand today: we are better off obviously for having executed the development of the Delfino years, (otherwise we would be in truly sad shape), but the tools used to execute the short-lived Renaissance may not have guaranteed a successful result, consequently the city is at another crossroads. Is this due to the economy? In part, yes. However, even before that, the sales taxes coming in were lagging, and not keeping pace with inflation.
