Some sour on affordable housing as Chelsea Market deal sweetener

BY BONNIE ROSENSTOCK | On September 5, the City Planning Commission (CPC) gave its unanimous approval to a plan which would allow the vertical expansion of Chelsea Market — after the iconic building’s owner, Jamestown Properties, agreed to a number of scalebacks and sweeteners.

Most significantly, the CPC further clarified plans — first proposed by Community Board 4 (CB4) during its June 6 full board vote — to build affordable housing somewhere in the CB4 area, preferably in Chelsea. Funding for such an effort would be drawn from money long ago earmarked for the High Line Improvement Fund (HLIF). Seen by some as a palatable local “get” in exchange for the City Council’s approval of Jamestown’s Uniform Land Use Review Procedure (ULURP) application, other community and tenant advocacy groups are sour on the deal — calling it an unlikely scenario, given the fact that housing promised during the creation of 2005’s Special West Chelsea District (SWCD) never materialzed.

“It’s not that we all don’t want affordable housing in Chelsea,” stated Andrew Berman, executive director of the Greenwich Village Society for Historic Preservation, “but we shouldn’t have to pay for it twice with two upzonings that this neighborhood doesn’t want or need.”

At a rally held on September 28 at the 15th Street and Tenth Avenue side of Chelsea Market, Berman was joined by more than two dozen activists from such wide-ranging groups as Save Chelsea, Tenant PAC, London Terrace Tenants Association, Chelsea Reform Democratic Club (City Council Speaker Christine Quinn’s club), Chelsea Coalition on Housing, Greenwich Village Community Task Force and Council of Chelsea Block Associations. They met to express solidarity in their opposition to the “two egregious towers” which Jamestown seeks to build on the Ninth and Tenth Avenue ends of the block-long complex. Berman noted that such construction is prohibited by the current zoning, but allowed by the CPC-approved upzoning.

Berman is a former member of CB4’s Affordable Housing Task Force, which was charged with overseeing the fulfillment of the city’s affordable housing commitments from the massive West Chelsea and Hudson Yards rezonings of 2005. But he said that the city did not keep its word.

At that time, Berman explained, the city promised that in return for rezoning the SWCD area, “filling it with huge buildings of luxury housing,” they would generate 27 percent affordable housing: 100 units targeted for middle- and moderate-income families. The designated location was on West 18th Street between Ninth and Tenth Avenue — a parking lot on Fulton Houses, which was then (and still is) owned by the New York City Housing Authority (NYCHA).

Set forth in the Special West Chelsea Points of Agreement, as reached between the mayor and the City Council, “All units will be permanently affordable…A portion to be developed may be set aside for NYCHA residents or households on the waiting list through Section 8.” (Section 8 of the Housing Act of 1937 authorizes the payment of rental housing assistance to private landlords on behalf of low-income households.)

However, after the City Council passed the upzoning, the community was informed there was no money to build it. “They said, ‘We didn’t know it was going to cost money to purchase the land. We can’t deliver,’ ” recalled Berman. “Now the city is saying, ‘If you let us upzone more of your neighborhood, with more unwanted towers in Chelsea, we’ll finally give you the money.’ They are asking us to pay a second time for what was owed us seven years ago.”

The proposed changes to Jamestown’s market expansion (agreed to by the applicant during public sessions of both CB4 and the CPC) would reduce its overall size from 325,000 new square feet to approximately 285,000 square feet. The Tenth Avenue addition will be set back from the High Line in tiers, to allow for more air and light. Setbacks begin at the top of the building, where the addition will be pushed back 15 feet, followed by another 10-foot pushback to 185 feet. There are a few more setbacks until its full 230-foot height, shorter than the nearby Caledonia condo, but taller than other surrounding industrial buildings. The Ninth Avenue addition will ascend to a 135-foot-tall, 95,000-square-foot office tower, level with the adjacent market roof, instead of 160 feet.

A hotel which was to be built over Buddakan restaurant on the Ninth Avenue side, has been scrapped. In addition, Jamestown has committed to preserving 60 percent of Chelsea Market’s concourse space for artisanal and independent retailers (the current rate of such occupancy is 85 percent).

“With these modifications, I believe this will be a great addition to the West Chelsea neighborhood,” said CPC Commissioner Amanda Burden, preceding the September 5 vote.

Immediately after, Michael Phillips, Jamestown COO and project manager, issued a written statement, which read (in part): “With the leadership of Commission Chair Amanda Burden, the Commission has modified the application to allow for some of the funds generated through a zoning bonus to be used for affordable housing, an approach that follows the road map set forth by the Community Board, and moves the project one step closer to reality.”

The plan now goes to the City Council, which has 50 days from the time of the CPC vote to hold a public hearing and approve, disapprove or modify it. The council will discuss the matter at an October 23 session which is open to the public. For details, visit council.nyc.gov.

Jamestown did not offer to include affordable housing in their proposal, acknowledged Rob Marino of The Marino Organization, Jamestown’s public relations firm, in an email to Chelsea Now. “Community Board 4 included it in their ‘No Unless’ vote on June 6, and Jamestown later agreed to the terms laid out by the Community Board, the Borough President and City Planning,” he said.

Jamestown will contribute to the HLIF and the Affordable Housing Trust (AHT). The AHT will be administered by the NYC Department of Housing Preservation & Development (HPD).

According to Marino, “As it stands now, the total contribution would be approximately $17 million. At the recommendation of the CPC, 30 percent of the funds, around $4,824,000, will go to affordable housing, and the remaining $12,663,000 to the High Line to support the long-term upkeep and maintenance of the park.”

On June 23, 2005, the City Council approved the three ULURP applications for the West Chelsea/High Line proposal. “After 90 percent of the High Line Transfer Corridor floor area is transferred to the receiving sites or is otherwise used, as an alternative to the High Line transfer, an increase in floor area would be permitted in exchange for contributions to an Affordable Housing Fund. The contribution amount per square foot would be determined by the City Planning Commission at the time that the fund is established,” the agreement stated. At that point, a projected $10 million of the High Line money could become available for land acquisitions for affordable housing and placed in the AHT, along with the money already in the pot.

“Also, keep in mind that the formula used in the zoning context is adjusted annually per the Consumer Price Index, so this number is likely to increase over time,” said Marino.

CPC’s September 5 approval of the Jamestown plan came about from a June 6 CB4 resolution, passed by the full board in the form of a 24 to 17 “No Unless” vote denying the expansion/rezoning unless Jamestown agreed to fund affordable housing. The CB4 resolution was initiated by the Chelsea Planning & Preservation Committee (CPP), also known as the Chelsea Land Use Committee, which heard Jamestown’s proposal. Co-chair Lee Compton and Joe Restuccia, co-chair of the Housing, Health & Human Resources (HHHS) Committee, put together the last-minute housing deal that convinced CPP to approve the deal (Compton was on vacation at press time, and Restuccia did not return Chelsea Now’s phone calls).

“Some new members didn’t even realize that Joe was not a committee member when Lee asked him to come and present his case,” said an anonymous source. “If not for the housing component, the plan would have been rejected outright.”
Mary Swartz, who has since resigned from the committee (for other reasons), apologized in front of the full board for her vote in favor. “I was surprised that it even came up in committee,” she said to Chelsea Now in a phone interview. “Affordable housing made this wrong plan conceivable. It was a bad vote, a bad idea and a bad precedent, more wrong than could be cured by even 27 percent — if it ever gets built.”

At the full board meeting, Pamela Wolff, co-chair of the Landmarks Committee, proposed a substitute “No Because” resolution to CPP’s letter in support of the affordable housing concession. Her resolution was narrowly defeated by four votes out of 47. For details, access the Chelsea Now website (chelseanow.com) and search for the June 15, 2012 article: “CB4 gives tepid green light to Chelsea Market expansion.”

Miguel Acevedo, president of the Fulton Houses Tenants Association, director of Fulton Youth of the Future and member of CB4’s CPP and HHHS committees, told Chelsea Now that he was the first person to propose creating an Affordable Housing Trust Fund. “Why not take the money from the High Line bonus?” he asked. “This was commercial real estate and had never been done this way. It gives us money to put into a fund for a future project in the community.”

Acevedo pointed out that Irwin Cohen, former owner of Chelsea Market, proposed it himself in 2005. “He said maybe we could create affordable housing with the High Line bonus with the redevelopment on top of Chelsea Market.”
CB4 cannot request a site where the money is going, acknowledged Acevedo, but it can make a recommendation — or the City Council and city can. “That’s why we came up with the Affordable Housing Trust Fund. “Of course,” he admitted, “I am going to advocate for Fulton Houses.”

Acevedo is also anticipating Jamestown’s commitment to creating job opportunities and training for people in the community at the proposed high-tech center that will sit atop the Chelsea Market.

While the housing fund money cannot be earmarked for a particular site, HPD sent a letter to CPC saying they have the need for the money at the Fulton location, “suggesting they’re going to use it there when they get it,” said Bob Benfatto, district manager of CB4. “Technically, we can’t ask for money,” he admitted.

The funds will go towards the city’s purchase of the West 18th Street NYCHA property; in essence, one city agency is paying another. The original monetary promise in the first rezoning was around $8 million, but there was no mention of finding the money to purchase land, stated Berman. “They just said they were going to build it. We don’t blame NYCHA, but the city.”

Artimus, the construction company that had previously won the Request for Proposal (RFP) for West 18th Street has already built an Elliott Chelsea building, ostensibly for low– to medium-income families at 401 West 25th Street near Ninth Avenue on NYCHA-owned land, which opened this April. The 22-story, 168-unit development cost $65 million, funded through a mix of private and public sources.

Berman, however, alleged that since the construction cost more than anticipated, the developer paid for it “by stuffing more market rate housing into it, which was not supposed to be part of the deal.”

One-third of the units were slated for “affordable housing,” but “It’s for people who make 195 percent of AMI [Average Median Income],” he said. According to CB4’s own data, for a single individual, annual income comes in at $113,000. “It’s another series of broken promises,” Berman asserted. Artimus did not return phone calls or email requests for a response.

Acevedo, too, questioned AMI figures for low- to moderate- and middle-income — that is, from $30,000 to $150,000. “How does a family of four survive on $30,000?” he asked. “When they created AMI, it was supposed to be 30 percent of income for rent, but that’s gross not net. When you break down taxes, it becomes 40 percent.” He added,“but that’s another conversation.”

As Norma Aviles commented at the rally, “The developers say they are going to build affordable housing, but it’s not for people who look like me.” Aviles of Chelsea Coalition on Housing, a grassroots tenants organization, and a fourth-generation Chelsea resident of Puerto Rican descent, added, “Including a contribution to a so-called ‘Affordable Housing Fund’ doesn’t make the plan any more palatable.”
While there seems to be general support for Chelsea Market expansion, Berman and company have vowed to keep up the fight — asking people to write to Speaker Quinn and the City Council and tell them to vote no, preserve the market and stop overdevelopment.

Said a skeptical Michael McKee, treasurer of Tenant PAC, “Even if it were not a fraud, 45 or 100 units of housing, which may or may not be built, which may or may not be affordable housing, is not worth swallowing this hideous development.”