BY SHARON WOOLUMS | Village small business owners, frightened as leases expire and having no renewal rights, should have hope with “progressive” lawmakers pledged to take the city in another direction from Bloomberg’s pro-real estate policies. After all, the City Council’s Sept. 30 hearing — “Oversight – Zoning and incentives for promoting retail diversity and preserving neighborhood character” — was touted as helping small businesses.
But Sung Soo Kim, a recognized authority on small business for three decades, warned, “Don’t be fooled! This hearing will determine the very survival of New York City small business owners along with a million jobs.”
However, the only real solution to stabilize, protect and save small businesses — the Small Business Jobs Survival Act — as Kim predicted, was not allowed to be discussed. Orchestrated by the Real Estate Board of New York lobby, this charade was disguised as “democracy at work.”
The hearing was given credibility by city government’s small business agencies, REBNY-friendly political leaders and government-funded business groups. Simply put, the hearing had two goals. First, continue to stop debate, public hearings or a vote on the S.B.J.S.A., which would give commercial tenants the right to negotiate fair lease terms upon renewal. Second, preserve the status quo by keeping power and rights of the lease-renewal process exclusively in landlords’ hands.
Kim called for a boycott of the hearing. This “sham hearing,” as he called it, was the final act of the longest-running scheme to use the power of government to “rig the system” against small business owners in favor of big real estate’s interests.
Mayor Bill de Blasio, Council Speaker Melissa Mark-Viverito, Public Advocate Letitia James and the borough presidents have all abdicated to REBNY their responsibility to find real solutions to the real problems faced by exorbitant rent increases, illegal extortion and short-term leases.
Unlike the current chairperson of the Small Business Committee, Robert Cornegy, at the S.B.J.S.A. bill’s Council hearing seven years ago, then-chairperson David Yassky was committed to passing a real solution.
“We absolutely have to do something period,” Yassky said back then. “It’s not an option to do nothing. We cannot allow businesses to be pushed to the point of disappearance.”
Every member of his committee became a sponsor of the measure, then known as the Small Business Survival Act — yet Yassky’s committee never got to vote on the bill.
With an election year about to start, Mayor de Blasio, Public Advocate James and several key councilmembers do not want the issue of a worsening crisis of record small business closings and loss of jobs to become a hot topic. They strongly supported the S.B.J.S.A. in the past, but flipped, remaining silent — while REBNY continues to rule City Hall.
This crisis worsened under their do-nothing policy, which jeopardized jobs and forced 1,000 small businesses to close, with more than 530 New York City court commercial evictions each month — even surpassing Bloomberg’s dire record.
For this column, I sent a six-question query to the mayor, Council speaker and several councilmembers. Only one responded, saying she was too busy to respond. Or perhaps she — they — having failed the litmus test as “progressives,” would rather “we the people” not know their true record here.
They may not want the public to realize that Trojan horse substitutes for the S.B.J.S.A. are an insult to desperate business owners facing a crisis of survival. The elephant in the Council Chamber hearing were the words not spoken — “save” and “stop.” There were mentions of “assisting,” “strengthening,” “helping” and “supporting” — but desperate store owners need more.
Ambivalent about going to the hearing, after receiving a text message that many advocates had shown up, I was encouraged and excited. I thought it important and valuable that so many advocates would take a day off work to go on record — having to wait to be the last allowed to speak! But when an advocate so eloquently spoke about the S.B.J.S.A., the councilmember moderating the hearing at that moment immediately admonished her not to mention the unmentionable — even though many held signs saying, “Pass #SBJSA NOW!!”
This was clearly a top-down agenda not welcoming grassroots efforts intent on finding the final solution, finally. Though I had signed up to speak, at that diss I bolted. Once again, Kim with his 30 years’ experience was right to boycott this “sham hearing” rigged against the “will of the people.”
Kim assures that, with the agenda made by and for REBNY, the proposals discussed will likely soon be voted into law, having nothing to do with the root cause of small businesses closing or laying off workers. The unfair, one-sided lease renewal process existing in our speculative commercial rental market — promoted by Giuliani, Bloomberg and now de Blasio — will continue unabated. The City Council will soon choose one of three options before election campaigns begin next year.
The first option is that they pass three pieces of legislation supported, and even likely written, by REBNY. One calls for landlords to receive tax credits for not raising commercial tenants’ rents upon lease renewals. But landlords could still charge whatever they want, so this proposal is open to exploitation and abuse by landlords — plus, taxpayers’ could get stuck with the bill.
The Independent Budget Office’s report on the costs of property tax abatements in return for freezing commercial rents concludes, “This abatement could have the unintended consequence of allowing landlords to raise commercial rents faster than they otherwise would have when leases for small business expire, with the city covering the cost.”
Another proposal also would cause the crisis to worsen. A bill by Brewer and Manhattan Borough President Gale Brewer, called the “Landlords’ Bill” 30 years ago, was basically the recommendation of a commission made up of real estate, bank and big business members. This proposal, calling for nonbinding mediation and a one-year lease extension at 15 percent rent increase — purportedly, to give merchants time to move — actually would result in high rents. That’s because to stay in their neighborhoods, businesses would be forced to bid against their neighbors — and move to where? Many have already moved several times to escape high rents.
The last Trojan horse proposal, a zoning law to limit chain stores on main shopping strips, though not making the crisis worse like the other two, would not address the root causes of forced closings. Zoning affects new tenants — not commercial lease renewals — thus would not save a single business.
And we don’t need study — of a study! — by a task force handpicked by REBNY, with outcomes predetermined.
The last option is passage of the Small Business Jobs Survival Act, the only real solution to end the crisis.
“The absolute, essential component of any law to stop the closing of businesses is the right to renewal of the lease, without which all proposals will fail, forcing independent owners to close,” Kim declared.
Einstein defined insanity as doing the same thing over and over again, expecting different results. It doesn’t take a rocket scientist to see that our small business policy over the last 30 years has failed miserably. One segment of our society (the 1 percent in control) is determined to do the same thing — to “rig the system” over and over again. Tell your elected officials, stop the insanity!