Based on how it was set up, the Hudson River Park Trust has always faced the prospect of running out of money — that it would simply not have funds to finish building the park and to keep operating and maintaining it at a high level.
This year, for the first time, the Trust, which was created along with the park in 1998, had to dip into a special $20 million reserve fund because the park was operating at a deficit of $1.2 million. (The reserve fund is from a settlement with the state Department of Transportation, which formerly operated Pier 40, at West Houston St.)
The Trust is now projecting a cumulative deficit in its operating budget of $10 million within the next five years. The fact is that while the city and state provide funding for the park’s construction, they don’t pitch in a penny for operations and maintenance. The park, in a unique arrangement, is supposed to be financially self-sustaining — and, in tight budget times, it’s unrealistic to think the city or state will change this formula.
Which is why the Trust now says it needs to partner with an independent fundraising entity to capture private money. The Trust would like that entity to be the Friends of Hudson River Park, the advocacy group that has been working to help the park over the past 10 years. It appears the Friends are interested in transitioning to this role. It makes sense to have an independent fundraising group, since people recoil from giving (more) money directly to the government.
For years, the Trust has been futilely pinning its hopes on increasing the revenue from Pier 40, where the parking operation generates about one-third of the $15 million the Trust reaps annually from its commercial tenants. But luring a private developer to repair the 14-acre pier and add potentially more lucrative uses — while at the same time not alienating the community with those uses — has so far proven impossible.
The Trust’s first Pier 40 R.F.P. (request for proposals) process ended in 2003, with the rejected proposals including an oceanarium, a FedEx-by-barge scheme and a big-box hardware store. In 2008, a second R.F.P. failed due to the economy and because Related couldn’t make its Cirque du Soleil mega-entertainment plan work without a long-term lease; the community loathed the plan, too. The Trust also said a more community-friendly proposal by Urban Dove/CampGroup and the Pier 40 Partnership wasn’t feasible.
In short, the Trust has been unable to turn Pier 40 into its hoped-for cash cow for the park. In fact, the pier’s revenue will decrease as it continues to deteriorate.
In the meantime, the West Houston St. pier’s capacious courtyard sports field — installed as “interim” after the first R.F.P. imploded — has become a treasured amenity.
That’s a key constituency — youth sports moms and dads — that fundraisers surely could tap into. But businesses and residents, in general, around Hudson River Park would gladly donate their dollars, we think, since the park has done so much to improve the area.
The idea is the private funds would supplement the Trust’s operating and maintenance budget, help fund capital projects, like Pier 40, and build an endowment. But we think the focus should be on targeted projects, specifically Pier 40, so essential, both in its revenue and its benefit to the community. People will be likelier to give if their money is going to a favorite project.
On the whole, we think fundraising is a good idea for the park. People in the communities around Hudson River Park really love it, and many are affluent. The park has given people a lot, and now they’ll be able to give back, and ensure this park gets completed and continues operating at a high level.
