city limits magazine, june/july 1990 issue

8/3/2019 City Limits Magazine, June/July 1990 Issue

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M O R T G A G E M A N IA D S T A R R E n C IT Y B U C K S T H E R U L E S ?B U D G E T A X E B L U E S D S T R IV E F O R J O B S


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2 CITY UMITS

Citv l . i m i ~ 5 Volume XV Number 6

City Limits is published ten times pe r year .monthly except double issues in June/Julyand August/September. by the City LimitsCommunity Information Service. Inc a nonprofit organization devoted to di sseminatinginformation concerning neighborhoodrevitalization.SponsorsAssociation for Neighborhood andHousing Development. Inc .New York Urban CoalitionPratt Institute Center for Community andEnvironmental DevelopmentUrban Homesteading Assistance BoardBoard of Directors"Eddie Bautista. NYLPIICharter Rights ProjectBeverly Cheuvront. CommunityService SocietyRebecca ReichAndrew Reicher. UHABRichard Rivera. Puerto Rican LegalDefense and Education Fund (on leave)Tom RobbinsRon Shiffman. Pratt CenterJay Small. ANHDWalter Stafford. New York UniversityPete Williams. Center for Lawand Social Justice

*Affiliations for identification only.Subscription rates are: for individuals andcommunity groups. $15/0ne Year. $25/TwoYears; for businesses. foundations . banks .government agencies and libraries. $35/0neYear. $50/Two Years. Low income. unem ployed. $10/0ne Year.City Limits welcomes comments and articlecontributions. Please include a stamped. selfaddressed envelope for return manuscripts.Material in City Limits does no t necessarilyreflect the opinion of the sponsoringorganizations. Send correspondence to : CITY LIMITS .40 Prince St New York. NY 10012.

Second class postage paidNew York. NY 10001City Limits (ISSN 0199-0330)(212) 925-9820FAX (212) 966-3407Editor: Doug TuretskyAssociate Editor: Lisa GlazerBusiness Director: Harry GadarigianContributing Editors: Marguerite Holloway.Mary Keefe. Peter Marcuse. Jennifer SternProduction: Chip CliffePhotographer: Adam Anik.Andrew LichtensteinIntern: Daniel ZaleskiCopyright 1990. All Rights Reserved. Noportion or portions of this journal may be reprinted without the express permission of thepublishers.City Limits is indexed in the Alternative PressIndex and the Avery Index to ArchitecturalPeriodicals and is available on microfilm fromUniversity Microfilms International . An nArbor. MI 48106.

Cover photograph by Andrew lichtenstein.

EDITORIAL

The Good and the BadRevolutionary? Hardly. Radical? Not quite. But th e Dinkinsadministration's recent announcement of changes in the city's 10-yearhousing plan are significant-and welcome .Putting their own stamp on a plan initially crafted by the Kochadministration, Mayor David Dinkins and Department of Housing Preservation an d Development Commissioner Felice Michetti have revisedthe housing program over the next four years so that more of the newlycreated apartments will be affordable to lower income New Yorkers. An dwhile the old version ofthe plan included no apartments for single homeless adults, the Dinkins administration's four-year plan is now promising to build 3,200 units.While Dinkins and Michetti have not changed the definitions of low,moderate and middle income households adopted by Koch, they haverecognized that far too many apartments being created under the 10-yearcapital housing plan were only affordable to families at the upper reachesof these categories. In order to make units affordable to more lowerincome families, the administration is providing deeper subsidies to

developers and these subsidies don't have to be repaid as rapidly asbefore. But this created a tough choice: Although they've added $101million to the plan for the next four years, the deeper subsidies mean theDinkins administration will actually renovate an d create fewer apartments than previously planned. It was the right choice.Other good choices include the pilot program to construct 500 mixedincome apartments, with 30 percent reserved for the homeless, and agrowing emphasis on comprehensive community development andeconomic integration. And while complete information is not yet available on planned mutual housing association an d limited equity co-opprograms, the initial news is good.But the plan is no t without its flaws . Because there are no long-termoperating subsidies, too many apartments may eventually become market rate units. And the changes that promote increased affotdability andadditional homeless units in the Vacant Buildings Program are no timmediately mandatory. Still, the mayor's four-year plan takes a giantstep in the right direction.

* * *

What's wrong with this scene? More than 100 city housing department, public housing authority and community housing activists arecrowded into the upstairs room of a lower Manhattan bar to say good-byeto Joe Shuldiner, who's leaving to ru n Los Angeles' housing authority.What's wrong is the Dinkins administration's appointments process,which not only allowed this talented , 17-year veteran of municipalservice to slip away, bu t the shabby way in which it was done.In repeated testimonials, Shuldiner was lauded by national leaders,former city commissioners an d current city officials as one of the mostrespected administrators in New York an d the best housing authoritymanager in the nation. Too bad the Dinkins administration's appointments process squandered the opportunity to keep Shuldiner, who'swillingness to serve New York seemed unbounded . New York's loss isLos Angeles' gain.* * *

For the second consecutive year, an article in City Limits has won ajournalism award from the Citizens Housing and Planning Council.Associate editor Lisa Glazer took top honors for he r story, "The PowersTo Be," which appeared in our October 1989 issue. 0

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INSIDEFEATURESThe Unkindest Cut 12The state's budget axe is poised to cut Home Relief,a little-known welfare program. Thousands of NewYorkers may soon become homeless.Bitter-Sweet Success 16Think your community has won an environmentalbattle? Think again.

DEPARTMENTSEditorialThe Good and the Bad .............................................. 2Short Term NotesCity Budget Blues ................................................. 4Tibbett Tumble? .................................................... 4Housing Now! ....................................................... 5Hotels Still Open? ................................................. 5ProfileSTRIVE: Job Training for the Long Haul.. .......... 6PipielineStarret City: Bucking the Rules? .......................... 8It's a Wonderful Life for Freddie Mac ...............10City ViewOrganizing Futures .............................................. 20Letters ....................................................................... 21

June/July 1990 3

Unkindest Cut/P


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4 CITY UMITS

SHORT TERM NOTESCITY BUDGET BLUES

While the Dinkins administration is planning to increasefunding for housing development, other crucial housingprograms are facing the city'sbudget axe. These includeprograms tha t fund communitygroups that assist tenants in avariety of ways and the city'sown inspection program toensure that buildings meethousing code regulations.Numerous advocates areprotesting these cuts, describing them as short-sighted andill-planned. "With tnese cutsyou're going to spend morethan you're going to save,"warns Penelope W. Pi-Sunyer,executive director of Alterbudget, which is proposing analternative to the city budget.The more than 100nonprofit housing groupsfunded under the city'scommunity consultant contracts are among those whomay feel the harsh cut of thebudget axe . Under the initialbudget plan released inFebruary, the communityconsultant program wastargeted for $1 .7 million incuts. The program providesneighborhood groups withfunding to assist tenants whodo not have lawyers inhousing court, help seniorcitizens file for rent abatements, aid tenants whocomplain of harassment bylandlords and other services.Sources indicate the city isnow considering cuts that willeliminate about 20 percent ofthe community consultantbudget. Advocates charge theresult will be the loss offrontline housing organizingstaff. "The toll will Oe reallygreat," says Anne Pasmanickof the Community Trainingand Resource Center. "Therewill be nowhere people canget that [assistance)."In recent years, cuts tocommunity consultant groupshave been softened by fundsprovided through the boroughpresidents offices. No suchfunds are likely to be available this year.Activists warn that projected cuts in the housing

department's inspection forcewill also be devastating. TheDinkins administration'spreliminary budget calls for a$1 .4 million reduction in theinsrection program, whichwil eliminate cyclical inspection of buildings for housingcode violations and effectively'kill efforts to rid aportments oflead point-a potentiallydeadly hazard to children.The housing department'sinspection squad has alreadybeen cut significantly in thepast year. According toPasmanick, the cuts have beenso severe that housing courtjudges are now able to orderonly a limited number ofinspections when tenants bringc o m ~ l ~ i n t s of hazardousconditions to court.Eliminating these inspections may also cost the citymore than it saves, chargesChris Quinn of the HousingJustice Campaign. "If the citywas to aggressively collectthose fines, the program couldpay for itself." She adds,'Without these programs,we're turning it over to thegood faith of landlords to takecare of low income housing."

Among the other programsfacing significant cuts is therevolving loon fund run byNeighbOrhood HousingServices (NHS). The pr


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HOUSING NOW!Homeless New Yorkers andtheir advocates joined withothers from a round the

country on the last weekend ofMay for "Housing Now, TheNext Step ," a conference inCincinnati , Oh io . Theconference was a follow-up tothe October 1989 housingmarch in Washington thatbrought together more than100,000 people.Conference organ izersaddressed ways to restorenational funding for housingand establish housingpriorities, as well as to waysto bridge the ga p between thehomeless and their advocates.Among the New Yorkparticipants were grassrootshomeless advocates whoformed a coalition this winterto promote their commongoals.Jean Chappell, a foundingmember of Parents on theMove, an advocacy groupformed by homeless mothersin the Brooklyn Arms Hotel,made frequent trips toWashington in recent monthsto help organize the conference along with Larry Wood,director of Housing Now!New York, and numerousothers.Chappell is also a foundingmember of a coalition ofgrassroots homeless activiststhat was created in February.The coalition meets twice amonth at the headquarters ofLocal 1199. Representativesfrom about 35 organizationsattend , according to Chappell.These groups include Parentson the Move, the HotelTenants Rights Project, and theUn ited Homeless Organization, among others . "We'relooking for a united front sowe can support one another,"explains Chappell . 0 DanZaleski

HOTELS STILLOPEN?As City Limits goes topress, there are more than1,000 families in the city's

JunelJuly 1990 5

A volunteer in the HWorlcing as Neighbors" workathon lends a hand to lowincome homesteaders otDestiny Co-op in Brooklyn. Participants in the spring eHort donated time at more than 40 community service projects in New Yorlc, an d collected pledges from friends for the hours they worked tosend medical aid to Centrol America.

welfare hotels and officialsfrom the Dinkins administration admit they may not meetthe June 30th deodline forclosing the hotels.Nancy Wackstein, directorof the Mayor's Office onHomelessness and SROHousing, says that even if thehotels aren't closed on time,each family will be assignedto permanent housing or anapartment-style transitionalshelter by June 30th.

"We' re certainly trying forJune 30th but we wouldconsider it a success if we hada destination certain for eachfamily...and were movingpeople out within two or threeweeks," she says. Wacksteinsays that even if the citydoesn't meet the deadline, thefederal government willcontinue to pay half the costof the hotels until the fall.According to informationcompiled by the city's HumanResources Administration, inMay there were still 1,081families in 19 welfare hotels.Of the 19 hotels, two are inBrooklyn, one is in the Bronxand the rest are evenlydivided between Manhattanand Queens . The Allertonhotel in midtown Manhattan

had the largest number offamilies, 128.In an effort to assist theclosure of the hotels, the NewYork City Housing Authorityrecently agreed to make anadditional 47 9 apartmentsavailable for homeless familiesin 1990. This would bring thetotal number of housingauthority apartments set asidefor homeless families to2,279, according to spokesperson Roy Metcalfe.Wackstein attributes thepossible delay in closing thehotels to a number of factors ."when we came into office,the effort to move families outhadn't had a lot of focus...things had slipped. We hadto renegotiate with the housing authority and mobilizeagencies to streamline andexpedite what they weredoing." She adds that production of apartment-styletransitional shelters is behindschedule and notes that thenumber of homeless familiesentering the city's shelter system recently increased . "In thelast month, new entries wereup, which was a cause of considerable concern," she says.Advocates for the homelesshave mixed reactions to the

city' s attempt to the close thehotels. Rose Anello, staffassociate at the CitizensCommittee for Children, says,"I think they' re moving along.They were left with a hugetask. Is he [Dinkins] doing agood job? If he succeeds inlinking families with housing,I'd say ..he deserves credit."But Anello also says that theproblems of families movinginto city-owned housing in theSouth Bronx, Harlem andcentral Brooklyn areenormous .Kr istin Morse from theCoalition for the Homelessadds, "I understand theproblems they're having ...1would say the biggest worry isthey [city officials] don't havethe foresight to help familiesinto the apartments and orientpeople. A lot of the [permanent housing] units are stillsubstandard."Threatened with a loss of$70 million in federal aid forhomeless families, the cityannounced plans to close thewelfare hotels within twoyears in the summer of 1988.In August 1988, the city'swelfare hotels sheltered 3,306families in 47 hotels. 0 LisaGlazer


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CITY UMITS

PROFILE

Training for the Long HaulMARY KEEFE

LOOKED LIKE ONE OF A THOUand corporate meetings: a large roomwith standard-issue officehairs, men wearing starched shirtsd ties, women in dresses and blaznot a hair out of place. Yet intead of taking place in Wall Street oridtown, this meeting occurred inhe basement of a community centerEast Harlem. The 27 participantsere enrolled in STRIVE, a threeeek employment training programesigned to help people find permaent jobs an d keep them.It was the third day of the programd each member of the group gave aive-minute speech that was recordedn video. For many, the experiences nerve-wracking. Nahir Gonlively 20-year-old, panickeduring he r speech bu t eventuallyompleted it and later called fiveinutes "the longest time ever."Valdes, who came to STRIVEstaying atobs, says she nearly didn't come tohe class because ofher fear of publicpeaking."You were nervous an d you didn'tant to get up here today. But youid it," announces Frank Horton, 29, STRIVE graduate who now leadshe program in East Harlem withqual measures of patience an doughness. "There's places you wanto be in your life, but you arefraid ..You expect people to understand that fear. We can understand itll day long, but until you cross thatridge and take on the responsibilty, it won't change."STRIVE, which stands for Support an d Training Resulting in Valuable Employment, focuses on peoplewho are often labeled "hard-toemploy." Of the 516 East HarlemSTRIVE graduates between 1985 an d1988, 49 percent were high schooldrop-outs, 75 percent were on publicassistance, 45 percent were parentsand 97 percent were black or Latino.The average age was 23.

ow Self-EsteemAccording to Horton, many of thepeople in the program are strugglingith low self-esteem an d languagearriers. "Their confidence is ter-

Confidence builder:Frank Horton leading a STRIVE session.

rible," he says. "My job is to dealwith their attitudes. They have goneto job after job and not been successful." At STRIVE, he says, "beforethey know it they have 20 or 30positive experiences since theywalked in."These positive experiencesappearto payoff-since opening in 1985,the program has placed 79 percent ofit s 853 graduates in jobs. And follow-up calls four times a year showthat 80 percent remain employed."We don't think our training iscomplete until someone is stablyemployed," says Michael Frey,founder and president of STRIVE.To him, that means two years in a jobthat's no t a dead end.Frey started STRIVE five years agoto replicate a program he was impressed with while serving as director of the Henry Street Settlement.The job training effort is privatelyfunded and meets needs that areignored by government-funded programs under the federal Job Trainingan d Partnership Act UTPA). Manyadvocates criticize JTPA because theemphasis is job placement rather thanjob retention.Since its inception, STRIVE hasexpanded and now has a second

branch located in a public housingproject in the Bronx. The program ispoised to take another leap becausethe New York-based Clark Foundation recently awarded it a $4 millionchallenge grant. Over the next fiveyears, the STRIVE staffers have toraise another $8 million to fundexpansion into eight new locationsan d to place 10,000 young NewYorkers in permanent jobs. The grantis a "particularly large one" for theClark Foundation, and what sold theboard was STRIVE's five-year recordof job retention rates, according toJoseph Cruickshank, secretary of thefoundation.

Rob Carmona, executive directorof STRIVE, says that th e key toSTRIVE's job retention rates is extensive personal contact an d individual calls to graduates at regularthree-month intervals. The programis short and intensive, and once it isover, graduates have lifetime accessfor extra help with personal problems, assistance moving up the jobladder or into higher education.Job developers at each STRIVElocation work with New York employers to help find slots that graduates can apply for, although manypeople find their ow n jobs, Carmona


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says. Most of the jobs are in backoffice operations, in areas like building operations an d hospitals. Thepolice department runs recruitingworkshops at the Bronx location.Program Meets NeedsLast October, Miriam Gaston readan ad for STRIVE in a newspaperafter she'd been ou t of work for ayear. She was looking for jobs, buteveryone asked about computer train-ing, which she lacked , an d she wasfearful about interviews. "I wasnervous about what people wouldthink of me and in an interview Iwould clam up an d get nervous," sherecalls. The program fit her needsbecause i t was brief, included com-puter training an d was free . At thetime, Gaston was 26 , supporting hertwo-year-old daughter on publicassistancean d living with her motherin Brooklyn.The quick training is part of thedesign, according to Frey. Many ofthe STRIVE participants are in direneed of a job and don't have the timeor money for a lengthy training program. At STRIVE, participants traineight hours a day for three weeks,learning communication an d interviewing skills, building confidence,an d looking at how to handle on-the~ o b problems. Basic "learner-

friendly" computer training is avail-able to everyone an d day care isprovided at one ofthe two branches.Ten days after Gaston graduatedfrom STRIVE, she landed a job as anadministrative secretary at the gradu-ate film department of New YorkUniversity. Summing up whySTRIVE has helped turn her life

JunelJuly 1990 7

around, she says, "Being on publicassistance is no t exactlyan ego building experience so you don't alwayscome in with the best attitude." AtSTRIVE, she says, "there's always asense of pride and respect." 0Mary Keefe is a freelance writer fo-cusing on community issues.

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8 CITY LIMITSPIPELINE

Starrett City: Bucking the Rules?BY LISA GLAZER

FOR MORE THAN A DECADE, THErace-conscious rental policies at theStarrett City housing complex inrooklyn were the source oflawsuitsand intense public scrutiny. Finally,a year and a half ago, the owners ofhe publicly subsidized developmentsigned a consent order with the u.S.overnment an d promised to stopusing racial quotas that ensured theproject remained predominantlywhite.But shortly after the consent de-cree was signed, the management ofStarrett City started an aggressivecampaign to rent some of the vacantapartments in the development atfair market rates. Because of this,Starrett City's rental policies are backin the spotlight.A recent fact sheet from StarrettCity reads, " ...a number of fair mar-ket, non-subsidized residents cur-rently enjoy the unique Starrett ..lifestyle. Due to the limited amountof available subsidy funds, vacated ..apartments will be largely rented atmarket rates."Although the overview is stillunclear, some longtime observers ofStarrett City say this could be anattempt to undermine the consentorder and retain white tenants as themajority. State and federal officialssay the Starrett managers are no tallowed to rent apartments at fairmarket rates, bu t Starrett officials arecontinuing nonetheless."The fair market thing may be anattempt to increase the possibility ofgetting white familiesJ given th eeconomics," says Harvey Fisher,director of the fair housing divisionof the city's Commission on HumanRights. "While there may not be anup front show of discrimination hereI would be wary of any change inStarrett's rental policy which wouldhave the effect of discriminatingagainst black or Latin applicants."Phyllis Spiro, a fair housing advocate from the Open Housing Center,which took part in a suit againstStarrett City's racial quotas, adds, "IfStarrett is looking for a mechanismto attract more whites .. then thiswould be a way to do that." Spirosays she has received 15 complaints

New question:Can Starrett City oHer apartments at lair marlcet rents?

about Starrett City's rental policiesin the past six months.Devorah Fong, a spokesperson forGrenadier Realty, which runs Star-rett City, denies wrongdoing. "Weare in no way trying to circumventthe consent decree," she says.Burtis M. Dougherty, who signedthe consent order on behalf of theu.S. government, says he has receivedcomplaints about Starrett City, butrefuses to comment further, explaining that he is not directly involved inthe enforcement of the consent de-cree. Amy Casner, a spokespersonfor the Justice Department, also re-fuses to comment on whether Star-rett City's fair market rental policiesaffect the consent decree.Waiting GameSince its inception in the 1970s,the management of Starrett Citymaintained a racial balance-approximately 35 percent blacks andLatinos and 65 percent whitesbecause they believed that i f thecomplex became mostly black andLatino, whites would flee. While thissystem preserved integration, i tmeant that blacks and Latinos lan-guished for years on waiting listswhile white applicants were on anexpress track to apartments.

In 1979 the Open Housing Centerchallenged the quota system and aftera lengthy battle agreed to a smallincrease in the number of minoritiesallowed to live in the complex, amongother changes. In 1984, the Reaganadministration challenged the quo-tas as part of its efforts to eliminateaffirmative action. The case was takento the Supreme Court, where thejustices upheld a lower court rulingthat the quotas violated federal law.Since signing a consent order lastspring, Starrett City has ha d to rentapartments on a colorblind basis.In the last year, newspaper advertisements offered hefty rent conces-sions to entice tenants to the com-plex. And a May 1989 letter to cur-rent tenants explaining the fair mar-ket rent program reads, " ... We allthink Starrett is a very special placeto live .. Your assistance in attractingnew residents under this programwill help assure its continued stabil-ity and success."Fong from Grenadier explains thatStarrett decided to rent apartmentsat fair market rates because subsidylevels have remained stable whileoperating costs soared. According toFong, subsidy regulations allowStarrett to rent out 10 percent of theapartments-or approximately 580


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apartments-at fair market rates. Shesays the apartments are only beingmade available to people who meetincome guidelines under the state'smiddle income Mitchell-Lama housing program.Federal and state officials sayStarrett doesn't have this option. Arecent letter from Myron Holtz, deputy commissioner of th e state'sDepartment of Housing and Community Renewal (DHCR), reads: "Starrett is...required to immediatelyceaserenting apartments to fair markettenants.""We've indicated to them that theycan't rent to market rate families,"adds Gerard Sheridan, director forhousing management in the regionaloffice of the federal Department ofHousing and Urban Development(HUD). Sheridan says Starrett canonly rent to families who qualify forthe federal subsidy programs.When asked what action would betaken against Starrett City, officialscould not provide definitive answers.HUD officials deferred to DHCR, theagency that has direct responsibilityfor supervising the housing complex.An d Tom Viola from DHCR says,"We are working on this and tryingto get them to cease and desist ..we'restill trying to reach a resolution."Public Funds, Private InvestorsThe complex that is now knownas Starrett City was built in the 1970sby the union-backed United Housing Foundation but the organizationdidn't have enough funding to complete the development and controlpassed to a small group of investorsled by Disque Deane. RobertC. Rosenberg, a former first deputy housingcommissioner, was brought in to runthe complex as general manager.Starrett City was financed with a$362 million mortgage from th estate's Housing Finance Agency, andtoday it receives federal subsidiesunder a variety of programs-Section 236, Section 8 and the RentalAssistance Program (RAP). Eachsubsidy program is geared towardsindividuals or families within aspecific income level. I f a family'Sincome increases beyond the levelallowed, their rent is adjusted andthey can remain in the complex.According to the most recentpublished information regarding thesubsidies, the 1986-1987 Report to

the Legislature on Mitchell-LamaHousing, Starrett City received $19.9million annually from HUD tosubsidize families housed within theSection 236 program. Under the RAPand Section 8 programs, Starrett Cityalso received HUD funding to subsidize more than 5,500 apartments.Starrett City has 5,881 apartments.Fong says that the dispute betweenStarrett and the government agencies is over whether tenants able toafford fair market rents have priorit y over families on the Section 236waiting list. "There was a disagreement about whether we could givepreference to fair market familiesover families on the Section 236waiting list," she says. "We are goingto 236 people first. They are no t beingdenied."According to Fong, Starrett City'swaiting list has been pruned from18,000 to about 6,000 and there arenow only about 850 names on theSection 236 waiting list. "Thesepeople have all been contacted," shesays, explaining that the vast majority were not interested in moving inor were rejected because of theircredit history.Despite Fong's arguments, a letterfrom DHCR states that even if theSection 236 list is exhausted, it is upto Starrett City to find ne w applicants. The letter also notes that Starrett City has been less than forthcoming with information about theirrental policies: "Our attempts to discuss these complaints with rentaloffice staffhave been met with vague

June/July 1990 9

and inconclusive responses an dmarked resistance to our requests foraccess to office records," writesdeputy commissioner Holtz.Eric Hauser, a spokesperson forRep. Charles Schumer, whose district . includes Starrett City, echoesthis point. "It is difficult to pin downexactly what is going on. Ou r officehas gotten calls from constituentswho are equally confused. And Starrett doesn't seem enthusiastic abouclarifying the situation."But Victor Bach, director of housing policy and research for th eCommunity Service Society, has aforward-thinking interpretation: "Ithink this is a long-term real estatestrategy to up the income levels theyserve and bring in a tenancy that'sopen to conversion, a tenancy thacan afford high rents without federasubsidies," he says. Bach explainsthat by the m i 1 9 9 0 s , Starrett Citymay be able to opt out of its federacontracts.While Starrett City is wranglingwith state and federal officials, thecity is going ahead with efforts toprovide hefty subsidies for SpringCreek Estates, a plan to create 4,700housing units on land near StarretCity. Most of the housing will be formiddle income New Yorkers. Starrett Housing Corporation, whichowns Starrett City and GrenadierRealty, has submitted a proposal todevelop the new housing. As part o, this broader effort, Starrett City isoften referred to now as Starrett atSpring Creek. 0

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10 CITY UMITS

PIPELINE It's a Wonderful Lifefor Freddie MacNicknamed Freddie Mac, the Federal Home Loan Mortgage Corporation is doingbooming business. That boom may be costing New York.

BY DOUG TURETSKYREMEMBER GEORGE BAILEY, THEsmall-town banker in the film "It's aWonderful Life?" When Bailey's savings and loan hi t the skids, the townsfolk stuck with him. The local savings bank was viewed as a part of thecommunity. Everybody in town pu ttheir money into the local savingsand loan and that's where townsfolkturned when they needed money tobuy a home.That was about the extent of asavings bank's business. No riskydeals, no big profits: the bankers werecalled three-six-three men becausethey paid three percent interest totheir depositors, charged six percentinterest on their mortgages and madeit to the golf course by three in theafternoon.

Savings and loans have changeddramatically since Bailey's day.When Ronald Reagan signed the S&Lderegulation bill in 1982, he openedthe floodgates to a tide of abuse thathas washed over the industry andresulted in a bailout now projectedto cost taxpayers some $500 billion.Well before deregulation fundamentally altered the way many S&Lsdo business, there were some othermoves thatchanged the way the banksoperate. In 1970, under lobbyingpressure from the savings banks,Congress created the Federal HomeLoan Mortgage Corporation, commonly known as Freddie Mac . Ittransformed the way S&Ls handledmost mortgages, spelling potentialdisaster for New York - and thenation.When Freddie Mac was created, itgave the savings banks an outlet forselling their mortgage loans, muchlike mortgage brokers sold their loansto the Federal National MortgageAssociation. Freddie Mac repackagesloans and sells them as mortgagebacked securities to Wall Street in anarena called the secondary mortgage

market. Because Freddie Mac hasthe implicit backing of the federalgovernment, investors see the corporation as a safe bet, explains FreddieMac official Paul Allen.The theory behind all this buyingand selling of mortgages is that itlinks the nation's capital markets tolocal banks and makes more moneyavailable for housing. Sirriply put,when a bank sells a mortgage to Freddie Mac, the S&L makes a quick profitand has money to write a new loan.In this brave new banking world,the traditional relationship betweenlocal bankers and home buyers orlandlords doesn't count for much.Instead of paying close attention tothe needs of their local customers,banks tailor their mortgage loans tothe demands of Freddie Mac officials, who, in turn, are listening tothe demands of Wall Street. In thisnew and complicated chain of relationships, accountability and blameare easily spread. Banks often issuemortgages for buildings in commu-nities hundreds of miles away, andthere isn't much checking to find outwhether the building can reallysupport the mortgage.In the short term, everyone involved seemed to prosper. Real estate operators had access to easy cash.The banks earned more by sellinglarge loans to Freddie Mac. AndFreddie Mac had a seemingly insatiable appetite to buy loans to berepackaged as securities. But theultimate results of this cycle may bemore devastating than anythingGeorge Bailey ever dreamed.Flush FreddieTwenty years ago, the secondarymortgage market was a small part ofthe mortgage industry. Today, Freddie Mac is a behemoth, holding morethan $300 billion in mortgages. Lastyear alone, Freddie Mac gobbled up$ 79 billion in mortgages, issued $125billion in securities and earned $437

million in profits.Because new rules passed underthe S&L bailout bill require the banksto meet tougher guidelines, FreddieMac's share of the market is likely togrow even more. And that's just finewith Freddie Mac's stockholders,who've seen their investments skyrocket. In 1989, Freddie Mac's stockzoomed from a low of $48.75 pershare to more than $100.With all this housing money generated by a congressionally charteredbusiness floating around, one mightthink affordable housing activistswould be overjoyed. In fact, a growing number of low income housingexperts see Freddie Mac as a banerather than a boon. Says HowardBanker of Neighborhood HousingServices of America, "Freddie Macwas a catastrophe for affordablehousing in New York City."Capitol TalkWhen Freddie Mac officials talkon Capitol Hill about their positiverole in promoting affordable housing, they often point to the Northwest Bronx. But real estate professionals, housing lenders, public officials and organizers from the Northwest Bronx Community and ClergyCoalition tell another story. Theysay the area may be on the brink ofdisaster. The reason: Freddie Mac'sover-financing, which spurred rampant speculation by some real estateoperators, is now causing an apparent rise in defaults and foreclosures.Three years ago, city housing officials warned Freddie Mac they wereover-mortgaging Bronx buildings.Freddie Mac refused to listen.As one self-described Bronx realestate operator says, Freddie Maccreated a market where one hadn'texisted before, bringing much neededcapital to renovate the area's declining housing stock. With propertyvalues suddenly on the rise, banksand brokers from as far away as Miami


11/24

Beach scrambled towrite Bronx loans theycould then sell to Freddie Mac. A buildingwould be bought at oneprice and then refinanced for hundred ofthousands of dollarsmore justa few monthslater (see City Limits,March 1989). For example, 130 West 183rdStreet, a 51-unit building ,was purchased for$750 ,000 and thenrefinanced for $1.2million just severalmonths later.Classic pyramidschemes were set intomotion. " Up andcoming " landlords

Its a wonderful life:Could George Bailey calm an overled Freddie Mac?

like Steven Green (see City Limits,January 1990) and Abraham Ginwould use the "excess" money fromone building to purchase another.Freddie Mac's ferocious appetite tobuy and securitize mortgages fueledthe speculation as its own bottomline boomed.But the foundation of this speculative pyramid has begun to crack.Streets like Loring Place in the Bronxare lined with Green ' s defaultedbuildings and Gin's once-heraldedempire is now bankrupt. Real estatesources say foreclosures on buildings with Freddie Mac mortgages aremushrooming in th e NorthwestBronx, where the corporation hasmore than 600 mortgages , as well asother parts of the city.Freddie Mac admits it has a default problem nationwide-as domany other mortgage institutionssince the real estate bubble has burst.Its losses on multi-family housingmore than doubled last year to $99million. But Freddie Mac denies ithas any problem in the Bronx.It 's a denial that belies FreddieMac's stated commitment to affordable housing. Acknowledging problems in the Bronx would meanadmitting the corporation had beenbuying mortgages of properties withwildly inflated values . And i twouldn 't be the first time.Several years ago Freddie Macstopped buying mortgages on Florida homes built by the General Development Corp. because the company was selling them at inflated

prices. But, as Robert Reno wrote inNewsday, Freddie Mac never tried topull the plug on General Development and warn potential home buyers . To do so would have meant alerting the holders of Freddie Mac's mortgage-backed securities that some ofthe mortgages were junk.Legislators and Treasury Department officials on Capitol Hill arenow worried that Freddie Mac mightbe holding too much junk and mayeventually require a federal bailout.Freddie Mac balances some $300billion in mortgages on just $1.9 billion in equity. Until last year, theFederal Home Loan Bank Board, theorganization that stood by while theS&Ls were looted , was responsiblefor regulating Freddie Mac. Now theDepartment of Housing and UrbanDevelopment has that role .Standard-BearerUltimately, Freddie Mac and theother secondary mortgage marketcompanies are driven by their needto protect their stockholders and bondbuyers. And because Freddie Macand the others have grown so big,they now effectively call the shots inthe mortgage market. If a loan doesn 'tmeet Freddie Mac 's (or the othersecondary market entities) criteria,many bankers won't lend.The result has been a standardization of the mortgage market, something Freddie Mac trumpets as a majoraccomplishment. While nationalstandards may make it easier forFreddie Mac to bu y loans , its under-

June/July 1990 11

mines the very diversecredit needs of individuals and communities. In "The UrbanHousing Crisis :SocialEconomic and Legal Issues and Prospects,"Arlene Zarembka concludes: "This [standardization], in turnwill make it more difficult for less expensive housing or housing located in lessvaluable neighborhoods to obtain mortgage financing."Freddie Mac's charter was recently rewritten to underscore thecorporation 's responsibility to serve thenation 's affordable housing needsFreddie Mac has since announcedan affordable housing unit that wilbe part of its marketing departmenand promised a $40 million investment in the Local Initiative SupporCorp.'s housing tax credit partnerships.Many housing activists believeFreddie Mac should do much moreRepresentatives from the Center foCommunity Change (CCC) andACORN have been meeting withFreddie Mac officials in Washingtonto press for more far reaching programs .Allen Fishbein, general counsel to CCC, is attempting to get Freddie Mac officials to recognize thedifferences between for-profit andnonprofit developers. He wants Freddie Mac to offer more favorable loanterms to nonprofits, bu t he says"Their [Freddie Mac] tendency is tosee it all as one market. "Northwest Bronx activists are alsopressing Freddie Mac to make somefundamental changes in the way theydo business. Worried that the foreclosed properties in their neighborhoods will just be sold to the nexgroup of speculators, activists areasking Freddie Mac to take a loss ontheir over-mortgaged properties andle t the tenants buy the buildings.Back in George Bailey's day, loc&bankers listened to their customerswho were also their neighbors. Freddie Mac's ear is cocked to Wall Streetbut with activists knocking on theidoors in Washington, it's clearly timefor a change. 0


12/24

12 CITY UMITS

FEATURE

The Unkindest CutHome Relief is the last vestige of support in the state's tattered safety net.Now it's the target of the budget axe.BY MARY KEEFE, ' m healthy, I want to work. It's not that I want tobe on welfare," says Angelo Rosario, a slightlybuilt man wearing a worn Reebok t-shirt and Detroit Pistons cap. The 33-year-old Bronx resident nevergraduated from high school, and it's been some timesince he held a job packing boxes for Manhattan fashioncompanies or working as a messenger. Three years agohe enrolled in a private trade school. Not long after theschool shut down, saddling him with a $3,500 loan hecan't repay and none of the promised training.Welfare caseworkers send Rosario to employmentagencies and public work programs. He's tried the merchants up and down Fordham Road and filled outapplications at all the fast food chains. "It's the same oldstory. You leave your address bu t they never get back toyou," says a frustrated Rosario.Rosario lives on a meager public assistance stirendknown as Home Relief. It's the bottom of the barre, thelast vestige of support in the state's tattered safety ne t forsingle adults or families without dependent children.Rosario's current monthly allotment is $352-much ofitgoing for rent for a small room. Now elected officials

want to save money by cutting people like Rosario fromthe state-funded Home Relief rolls."Home Relief is the most stigmatized of all the publicassistance programs," says Guida West, director of policy, advocacy and research at the Federation of Protestant Welfare Agencies. To many New Yorkers, the elderly or people with disabilities are the deserving poorand the presence of children makes assistance acceptable for poor families, explains West. "But Home Reliefhas always been seen as able adults ..the public notionis that i f you just try harder you will get a job."Despite the harsh reality that jobs are getting harder tofind in a state with a declining economy, this notion isgaining acceptance among a growing number of electedofficials. A year ago state legislation was passed requiring all "job ready" Home Relief recipients to join a newJob Search program or get cu t from the assistance rolls.But the program is little more than a sketchy assessmentof who is job ready and provides no funds for job trainingor placement. Before Job Search is even fully implemented, much less evaluated, bills have been proposedby both Gov. Mario Cuomo and Republican state senators that would place further restrictions on Home Reliefbenefits. Recipients deemed job ready could not collect


13/24

Home Relief for more than six months during any 18-month period. State officials may be hoping to reducepublic assistance expenditures, but advocates for thepoor say the result will be a surge in homelessness.Bootstraps"These people are going to become homeless becausethey've got no other means to support themselves," saysKristin Morse of the Coalition for the Homeless. "Theidea is that this will givepeople impetus to pullthemselves up by theirbootstraps-even thoughthey don't have any boots."In the last few months, abroad coalition of advocates, including the coalition, United Way and thestatewide Hunger ActionNetwork have lobbied extensively to try and defeatthe proposed cuts to HomeRelief. Advocates are claiming a temporary victorybecause the cuts are notincluded in the most recentversion of the ever-changing budget. However, thisis subject to change andlegislators from the Republican-controlled Senate saythey intend to raise th eproposals again, at the veryleast to be used as a bargainingchip in negotiationsthat continue even after thebudget is announced.

Jerry Willins and his son, Jerell.

June/July 1990 13

males, an unpublished state Department of Social Services (DSS) survey reveals that nearly half of those on theHome Relief rolls are women, some with children under19. Many have serious health problems. And largenumbers are eligible for other public assistance programs like federally funded Social Security Insurance,but have been cut off because of bureaucratic bungling.Although those on Home Relief are often characterized as laggards, a 1987 state study of recipients outsideNew York City showed thatabout half the men andwomen received benefits foronly about six months. DSSrecords indicate that in 198816,000 Home Relief clientsfound employment.Th e city's Human Resources Administration estimates that 36,600 Home

Relief recipients in the fiveboroughs will eventually belabeled job ready and required to undertake theirow n job hunt. They are thetargets of the newly proposed legislation, whichcould cut off their benefitsfor a year at a time if theydon't satisfy job-huntingrequirements. "We believein the inherent value ofwork," says DSS spokesperson Mark Lewis.

Whatever decision isreached will be madewithin the broader contextof the state's implementation of federally mandatedwelfare reform. In a classiccase of government proposals working at cross-purposes, just as the state isgearing up to spend moremoney on support programsfor recipients of Aid to

Willins was cu' from the Home Re'ief rolls si x months ago.Pronounced ;ob ready, he's b_n unable to 'and a ;ob.

But some state officialsapparently recognize thatthe job search will often befutile. A DSS fact sheet issued just six months beforethe creation of Job Searchstates, "Even among thosewho are able-bodied andavailable for work, HomeRelief recipients tend tolack the essential educational and vocational background for job-seeking success." According to the unpublished state survey, 56percent of those receivingFamilies with Dependent Children, another welfareprogram, legislators are considering reducing benefitsfor those receiving Home Relief."The state is breaking down a commitment to treatingall people on public assistance the same way," says DonFriedman, a legal services attorney who works regularlywith the Citywide Welfare Advocacy Network. I f thecuts are made, he says, "They're saving money on thebacks of people on Home Relief."

Beyond the StereotypesHome Relief recipients comprise about 20 percent ofal l public assistance cases. Despite stereotypes that thevast majority of Home Relief recipients are able-bodied

Home Relief never finished high school and 25 percentonly completed grammar school. As the state's economybegins to slide, the competition for jobs is intensifyingand even so-called entry-level jobs are demanding anincreasing level of skills. In fact, the state's ow n budgetdivision estimates the number of individuals needingpublic assistance will rise in the next year.Take That JobStill, Lewis insists, "A lo t of people on public assistance don't believe they have to work. One of the philosophical issues this bill raises is should someone onwelfare be required to take a job at McDonald's. Theadministration's position comes down to: I f there are


14/24

14 CITY LIMITS

jobs in the community people shouldbe in them."Public assistance advocateslike Myrna Perezof the CitizensAdvice Bureau inthe Bronx arguethat Home Reliefprovides too fewenefits to helprecipients negotiate even the mostasic job search."They get so little.ow are theyoing to dress too on interviews?

eople can't even buy clothes or shoes. An d evencDonald's is going to ask for skills," says Perez.To critics like those at the Coalition for the Homeless,he latest attempts to tighten Home Relief rules haveore to do with forcing people off the public assistanceolls than helping them gain skills an d jobs. Thousandsof city residents were "churned" from public assistanceolls during the 1980s, an d Home Relief recipients acounted for about 60 percent ofthe people who had theiraccording to a coalition report.The proposed rules may well ad d to these totals. Theoalition for the Homeless report says that i f 1,700eople were forced into the shelter system because oftricter Home Reliefrules, the cost would exceed the $25illion officials say would be saved in reduced publicassistance benefits.he Pennsylvania ExampleNew York is not the first state to attempt such reducions. Since 1982 Pennsylvania has ha d a law limitingcash benefits to a population similar to those on HomeRelief in New York. In Pennsylvania, anyone aged 18-45deemed work ready and "transitionally needy" is limited to just three months of benefits during any 12-

Who's Job Ready?Last year state legislation was passed requmnglocal social service agencies to evaluate the job readiness of all applicants an d recipients of Home Relief. Astate administrative directive provides a one-pageform with eight yes or no answers to be filled ou t byoverburdened social workers expected to make snapjudgments about mental an d physical health, education and English proficiency, vocational skills andsubstance abuse history of those receiving Home Relief. The social worker must also put this informationinto the context of the local job market.I f the social worker's evaluation labels a recipientjob ready, he or she is required to make at least threecontacts a week with prospective employers over a

120-day period and provide proof of these contacts to

Myrna P.re% (I.It):Hom ief recipi.nts"get so li", .. .peopl.can't .v.n buy clo"'.sorsh_s."Kristin Mors. (below):Hcuts are mad.,"''''.s. people aregoing to becomehom.I . . ."

month period. Jane Malone, director of the Office of Services tothe Homeless in Philadelphia, saysthat a local study found that of the150,000 people who lost theirbenefits , no more than 15 percenthave found jobs.Pennsylvania officials alsodrew up rules requiring what thestate calls General Assistance recipients to make aproscribed number of job contacts.According toMalone, one jobthat lasted three ormore months wasfound for approximately every 9,000

contacts made.That left recipients with an average annual wage ofjust $2,390.Such factsseem to confirmadvocates ' chargesthat further reductions in Newz York's Home Relief benefits will


15/24

A broad statewide coalition of advocacy an d servicegroups is lobbying Albany legislators to offer HomeRelief recipients many of the same assistance programsbeing proposed for those receiving AFDC (even thougha huge battle continues to rage over the inadequacy ofsome of these programs). "The best thing to do for HomeRelief recipients would be to match efforts with propercounseling, proper education and proper job trainingprograms," says James Mulligan of the Citywide WelfareAdvocacy Network. "Right now they're not doing that.They're no t taking a holistic approach to the problem."But as long as the perception of Home Relief recipients as the undeserving poor persists, legislators arelikely to perceive the program as prime for the budgetaxe."The public is operating out of missassumptions andpublic assumptions are reflected in the assumptions oflegislators," says West of th e Federation of ProtestantWelfare Agencies. "Garbage in , garbage out. You definethe problems erroneously and you get stupid solutions."0don't miss the

City Limitsspectacular spring fundraiser

Tuesday, June 5th, 6:00 p.m.The Place: Two Boots Restaurant

514 Second Street, Park Slope, Brooklyn$10 Cover Hors d'oeuvres Cash Bar

Call (212) 925-9820 for further information

June/July 1990 1

The Center for Popular Economics'Summer Institute 1990

A week of intensive economics training whichprovides an integrated view of economics,designed for activists, organizers, andeducators, to make their work more effective.NO PREVIOUS ECONOMICS TRAINING NECESSARYThe topics for this year include:"'the economics of the environment"'democratizing the U.S. financial system"'plant closures and runaway shops"'the third world debt crisis"'the U.S. as a debtor nation"'the economics of housingand much morel!!

This year's institute runs from July 29-August 4Scholarships are available, and on-site daycareis available.THE APPLICATION DEADLINE IS JULY 14TH

Write to :The Center fo r Popular EconomicsBox 78SC ,. Amherst, MA 01004

Hold These DatesNOVEMBER 6 - 8, 1990

UPROOTING POVERTYTHROUGH COMMUNITY DEVELOPMENTIn celebration of our 25th anniversary, the Pratt Institute.Center for Community

and Environmental Development will be sponsoring a working conferenceto develop a new agenda for eliminating poverty.For groups wishing to participate in the event, please contact:

Eva Neubauer, Pratt Institute Center for Community and Environmental Development,379 DeKalb Avenue, 2nd floor Brooklyn, NY 11205, 718/636-3486


16/24

16 CItY UMITSFEATURE

Bitter-Sweet SuccessThink your community has won a battle against a local polluter? Think again.BY MARGUERITE HOLLOW A Y

F ive years ago, Jane Califf could no longer toleratethe stench of nail polish in her Boerum Hill,Brooklyn, apartment. She joined the Boerum HillSouth Brooklyn Clean Air Committee, which after several years of struggle, won the fight to get the noxiousemissions from a local factory out of their air.Ten years ago, Marty Sonnenfeldstarted talking topeople about theodor, color, andtaste of their Jamaica, Qu-e-ens,water - an d abouttheir white clothesthat would notcome clean, exceptat the dry cleaner.In 1985, Sonnenfeldand th e JamaicaClean Water Coalition won the fightto have thelast NewYork City weH wate r condemned andthe privately ownedJamaica Water Supply Company purchased by the city.

the hands of a vast city, state an d federal bureaucracies.As Arthur Kell, a citywide toxics organizer for theNew York Public Interest Research Group puts it , "Battleson environmen tal issues typically test the stamina of themost committed grassroots activists . These battles mustbe followed through on a complex number of levels ..thebattle isn 't over until it's over."Once government agencies start to regulate a hazard,grassroots activismcan be defused bybureaucratic bungling as well asmystifying scientific jargon. Also,it's obviously easier to target a problem than implement a solution; forexample, momentum can be lostbecause agenciesare hesitant to takeon the risks of newand alternativet echno log ies ,sometimes withgood reason. Andin neighborhoodswhere polluters arealso a primary em -~ l o y e r , the battlelines are not soclearly drawn.Califf and Sonnenfeld are just afe w of -th e thousands of New YorkCity residents whohave joined grassroots community

Mixed me . ge.:ShI,. and federal agencie. aren't coordinating enforcement 01 air emi . on .from tfte Ulano factory in 80erum Hill.

"It's no t easy,"says Barry Commoner , a veteranenvironmental advocate who runsgroups grappling with environmental hazards close tohome. Their struggles may not be as well publicized asglobal effottst9 steI1l the greenhouse effect , bu t they 'repart of a growing number of urban environmentalistswh o are gaining S'Ophistication an d achieving somesuccess. _So why is Califf still plagued by fumes? An d why arehalf of the residents of Jamaica - with some 500,000residents - still drinking well water that may be tainted?Some community groups that successfully wage wa ragainst environmental threats seem to experience onlythe bitter side of bitter-sweet victory. After hard-foughtbattles, the Boerum Hill-South Brooklyn Clean AirCommittee an d the Jamaica Safe Water Coalition appeared to be . the winners when government regulatorsagreed to sfep in an d take control of environmentalhazards. Yet neither group has seen significant improvements. Their struggles are dead in the water , lost in

the Center for the Biology of Natural Systems at QueensCollege. "I f you decide you want to solve the problemyou do everything possible an d as the issues move fromone level to another, you just follow them. It 's a constantbattle ..you just have to keep going."Toluene TroublesBoerum Hill , Brooklyn, with it s brownstones , publichousing projects an d small businesses, is home to working-class families as well as artists with a need for largespaces and low rent. It's also the base for the Ulano factory , a squat brick building that was the city 's largestemitter of toluene-a dangerous solvent that may causecancer.More than a decade ago, Boerum Hill residents firstwrote to officials asking for an investigation into theodorous emissions from the factory at 280 Bergen Street.After a community demonstration generated publicity,


17/24

th e state's Department ofEnvironmental Conservation(DEC) tested the facility in1981. They found the company in violation of stateregulations and ordered agradual reduction of emissions by 1985.But 1985. brought nochange: DEC granted thecompany an extension. Atthat point, Jane Cali ff got involved "because it was socreepy to go down the blockan d smell nail polish." TheBrooklyn Lung Associationjoined the fight an d the CleanAir Committee enlisted technical consultants to helpinterpret state data and testemissions from th e factory.

Quality concern.:

JunelJuly 1990 17

getridof95 percent. According to Califf, DEC was goingto give Ulano a permit butthen the EPA stepped in tosay the state agency couldn'tviolate its own regulations.Helper from the EPA saysthat it's up to the state torevise their regulations if heywant the incinerator to receive a permit. "The stateneeds to propose the change.We cannot revise a stateplan." She adds that the EPAmay draft a letter to DEC toprompt some action.Watered-DownThe water that most NewYork City residents drinkcomes from upstate and is renowned for having a highstandard of cleanliness-it's

:.


18/24

18 CITY UMITS

the greatest concern came from African-Americans whosuffered from the poorest quality water. "People wouldask, 'What happens when I drink this stuff? Can I bathemy daughter in it?"The Jamaica Clean Water Coalition was created, withstrong support from African-Americans who looked attheir water supply an d saw evidence of racism. "Therewas an outrage about social justice," says Sonnenfeld."People asked, 'How come they get city water over therean d I can't get it here?' Without exception, the blackerthe community, the worse the contamination."Ron LaLande, who headed the coalition, agrees. I f hishad been a primarily white community "the city wouldhave paid a lot more heed to the outcry," he says, adding,"It upset me that therewere no governmentsponsored medicalstudies" of health effects of the water.

With the community strongly mobilized and unified, legislators took heed. In1985, a bill committed the city to condemn Jamaica WaterSupply Company andpurchase it. "We hadpractically drafted thebill," says Sonnenfeld. "This was a tremendously successfulcommunity organization."

C'o.. ,'ation.hip:

This spring, the company finally submitted theirselling price: $800 million, according to the Daily News.City officials say they're willing to pay $75 million.Clearly, negotiations have a long way to go.But even if the purchase was accelerated, it is unclearwhat, if anything, the city would do differently than thecompany-at least until the year 2000, when the newestwater main is expected to supply Jamaica with reservoirwater from upstate. As a partial solution, the city nowsupplies water to peripheral areas of Jamaica-thoseclosest to city water mains-such as Kew Gardens,Richmond Hills and Hollis Hills. "All white communities," notes Sonnenfeld.Sonnenfeld urges filtration of the entire well system.Currently, three filters-costing$150,000 each-are inuse in Jamaica. Butthis kind of filtration

may just be creating anew problem becauseit releases pollutantsinto the air. When confronted with this dilemma, local expertsjust raised their handsin dismay.Working TogetherThe Dutch Killsneighborhood inQueens is solidlyworking class, a placewhere residents andindustry have co-existed for years. Referring to the owners ofthe numerous smallfactories that employ

Despite this victory,there were some lingering doubts in thecommunity. "We accepted the legislativemove with skepticism," says SeymourSchwartz, who wasthen active in the coa-Th. Po'y PIa.tic. lactory (right) i . next to ,..idenfia' home. in Dutch Kill.,Qu_n

many local residents,George Stamatiades,president of the Dutchlition. The legislators "did that to get the heat offthemselves because the community was strongly organizedthen. And so they defused us."Time has proven Schwartz right. Not much has happened since 1985. Although wells are monitored fourtimes a year by the city and the company, "the contaminants are still in there, bu t in lower levels," says Sonnenfeld. The city is supposed to be purchasing the rest of thewells from the Jamaica Water Supply Company, but theselling process is moving a:head at a sloth-like pace.As time passes, officials from the water companycontinue to proclaim that their water is, was and will besafe for drinking. Despite these assurances, Sonnenfeld,LaLande and Schwartz are adamant that the water remains a serious health concern. "It's a time bomb," saysSchwartz. Contaminated "drug products and food products are removed at once from the shelves-look atPerrier. Should the profit motive allow Jamaica Water todrag its feet when hundreds of thousands of lives areaffected?"

Kills Civic Association, says, "We're in a partnership with them. We're notin an adversarial relationship. If the workforce liveswithin walking distance you watch ou t for each other."The Dutch Kills Civic Association has had somesuccess from their approach-most notably an agreement with the officials from a nearby lacquer factory,who agreed to pu t a vent over an opening in the factorywhere fumes were being emitted.However, in a new confrontation with a plastic manufacturing company it has become "necessary to pushbuttons for city agencies which have an uncanny way ofmaking life miserable for everyone," says Stamatiades.In a case that recalls the Ulano struggle, residents next toPoly Plastics at 36-36 36th Street are complaining aboutnoxious odors from the factory. "You can't even breathe,"says Liz Goff, a nearby resident who has reported aboutthe complaints for the Long Island City Journal.Poly Plastics' vice president, Sheldon Rothchild, saysthe federal Occupational Safety and Health Administration (OSHA) tested the air inside the factory and found


19/24

i t fine. OSHA's SalvatoreRoberto says that was indeedtrue, and that the EPA is re-sponsible for air quality out-side. City Department of En-vironmentalProtection (DEP)officials say there is no prob-lem, aside from a buildingviolation: Poly Plastics currently has no certificate ofoccupancy,but has until midJune to get it renewed. TheDepartment of Buildingsseems more concerned aboutthe fumes than the DEP: thecompany's certificate was notrenewed "because of odors,"says spokesman Vahe Tirya-kian.Even in this instance,where a community groupappears willing to work withbusiness, the labyrinth oflocal and federal regulationsare working at cross-purposes. I t remains to be seenwhether the Dutch Kills CivicAssociation will have tochange tactics and becomeconfrontational.Frustrating SetbacksSetbacks are frustrating,

Georve Stelmatiade.:" ha. &.come Nnece.. ry tel pu.h &uttan. lo r city a"encie.,which have an uncanny way 01 maleinfl ,ife mi.. a&'e lo reveryone."

June/July 1990 19

its source have been sidelined in favor of a regulatoryapproach, which is less poli ically controversial. "In thebroadest terms, many environmental groups ...havedecided to regulate theamount of pollutants andhave failed to really achievethe prevention of pollutionto begin with," he says.Others, like Commonersay the problem is a lack oleadership from politicianwho set the agenda for enforcement agencies. Pointing blame directly towardGov. Mario Cuomo an d former President Ronald Reagan, he says, "The state environmental program is verypoor and the EPA ha s ittroubles too. In this instancelwe're dependent uponelected officials. I f hey don'do their job, you move ontopolitical activity."He continues, "We live ina society where governmenis no t responsive to the needof people . .it's only responsive to th e needs of peoplwith money. So what's newbu t longtime environmental advocates say they are justone part of what sometimes seems like a never endingstruggle. Kell from NYPIRGsays that part of the rroblemis the framework within which environmenta changetakes place. For decades , attempts to stop pollution at

You can wring your hands, bu t [the problem] isn't solveduntil it's solved." 0Marguerite Holloway is a freelance writer who focuseon environmental and public health issues.

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20 CITY UMITS .CITY VIEW

Community Development:Running on Empty in Central BrooklynBY MARK WINSTON GRIFFITHWHEN I GRADUATED FROM COLlege five years ago, my suburb-bound,upwardly mobile classmates werenot surprised to learn that I was planning to return to the streets of "Door-Die" Bed-Stuy. Themove was a perfectlynatural one for me.Having been away formore than 10 years, itwas time to reconcilea personal and professional relationshipwith CentralBrooklyn that my family began almost 40years ago.My parents, unclesand aunts were involved in what is nowan integral part ofBrooklyn lore- theOcean-Hill Brownsville decentralizationbattle, the Model Cities program an d summer academy andcountless other blackconsciousness struggles and war-onpoverty programs. When I was growing up , terms like "community empowerment" and "economic development" meant nothing to me. But Ivi vidly remember the palpable senseof determination and endless possibility that pervaded the air. Hellyeah, we were poor, but with a blueprint of the future tucked away inour back pockets, it was just a matterof time before we created a new reality for ourselves.No SecretIt's no secret that neighborhoodslike Bed-Stuy, Crown Heights andHarlem are still waiting to achieveself-determination-despite the factthat black officials are now regularlyelected. Those of us who work for

City View is a forum for opinionand does not necessarily reflectthe views ofCity Limits.

community development organizations, the last institutional remnantsfrom the spirit of the 1960s, acceptpatience as an unwritten part of thejob. We know that by definition,"the struggle" is a long and protractedone. But these days development

organizations in Central Brooklyn arerunning low on idealism and mycolleagues are finding little else tosustain them. At least four groups inCentral Brooklyn have directors whoare on the verge of leaving and a fewmay even disband because majorfunding cuts are looming.In a few short years as a community development professional, I havetasted the disillusionment and cynicism that many of these directorsspeak of. It's more than a simplematter of grassroots burnout. Whencity and state funding agencies oppress organizationswith overwhelming bureaucratic obligations andseverely restrict input on community planning, it's easy to start believing that your role is simply touphold a government-subsidizedstatus quo.ConclusionsOnce you've reached that demoralizing conclusion, it's hard to keepworking with a clear conscience. An

alternative does exist: developinglocal institutions that are not dependant on city and state funding . Tomany, the choice may seem ludicrous: How can a low income community actually build and thriveusing its ow n resources? The way Isee it, there's no other choice. It'ssimply a matter of following thelegacy handed down to me by myfamily and environment.At the moment, only a handful ofyoung people venture into the fieldof community development and mostof them leave after a few frustratingyears. The challenge to CentralBrooklyn and a dozen other similarareas is to attract new, creative leadership to the profession, leadershipthat believes we, the black and historically disenfranchised, still havethe capacity to reinvent ourselves.Of course, the hours will be long andin most cases the pay will stink. Inthe meantime, it will be the toughestjob we will ever need to love. 0Mark Winston Griffith lives inBedford-Stuyvesant and has workedfor the Crown Heights NeighborhoodImprovement Association and Central Brooklyn Partnership for Economic Development. He is currentlyorganizing a Central Brooklyn creditunion.

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LETTERS

Archive OmissionsTo the Editor:In Daniel Zaleski's "ArchivesFight" (April, 1990), your reportingincluded some inaccuracies andomitted some important information.Your statement that "the Teitelbaum Group ..paid $1 0 to lease the...building" is incomplete an d misleading. A $10 payment was consideration for the first amendment ofthe lease in 1982 but was not anelement of the rent.The rent for the Archive is substantial. I t consists of payments inlieu of real estate taxes, a percentageof refinancing proceeds, a participation in proceeds from any future coop conversion or sale of the projectand other obligations as well as baserent ($10,000 per apartment) andeight percent of gross rent fromcommercial space.To date, more than $2 million inrent has been paid. This money goesto the New York City Historic Properties Fund. And in addition to rent,the Archive Fund, which comprisesthe money that would have beenpaid as sales tax for constructionmaterials, is distributed to localgroups at the direction of Community Board 2.As to the issue of the communitygroups selected to occupy the semipublic space, it is the developer, no tthe community board, who is responsible. Community Board 2 andthe Urban Development Corporationonly review and comment on theselection. Of the many groups thatapplied, those that have been selected are our first choice an d wehave been trying to respond to eachgroup's specific needs and get themto become tenants .

Additionally, my quote that therenovation work is complete wastaken out of context. The renovationofthe Archive is complete; the landlord work in the semi-public space isnot. Landlord work within the tenant spaces will be coordinated withthe plans of specific tenants. Thiswill allow the tenant, for example, toselect the color that the walls andceiling are painted or to get a creditfor the basic light fixtures the landlord would provide if the tenantwants a different fixture.City Limits is ofinterest an d valueto it s readers not just for its point of

view but also for the information itprovides. An accurate article is thebest means of establishing a crediblepoint of view.John Pettit West IIIRockrose Development Corp.

Zaleski replies: Thank you for theclarification in regards to paymentof rent from the Archive Building.That Rockrose makes payments tothe historic properties fund an d pay-ments in lieu of taxes to local groupsis really beside the point. The build-ing would probably be generatingmore tax revenue for the city i f t wastreated like the private developmentproject it is. The fact that Rockroseplans to complete such work as par-titioning and painting does not ad-dress the major issues that mosttenants spoke of-ventilation for airconditioning and heating and theneed for space suitable for office use .Despite several meetings with Rock-rose over the past year, agreementshave not been reached.There They Go AgainTo the Editor:

Once again, the role of the NewYork City Partnership is mistakenlyportrayed by City Limits as a developer competing with local groupsrather than as a source of technicalassistance and financing for housingprojects built under a city homeownership program-in Lisa Glazer's"Pride and Poverty in BedfordStuyvesant" (May 1990).The Housing Partnership , like theEnterprise Foundation and the LocalInitiative Support Corporation, is anintermediary that helps the housingdepartment administer a city affordable housing production program.Incidentally, the partnership alsoadministers the city's only minorityhome builder program-the SmallBuilder Assistance Program-whichwas favorably referenced withoutcredit to the partnership in the sameissue of City Limits.Because the Housing Partnershipprogram depends on mostly privatefunds for financing , its developersmust be bankable home builders.However, development teams include nonprofit community groupsin planning and marketing roles and,

June'July 1990 21. . t

occasionally, as co-developers. In ncase does the partnership becominvolved in a project unless it has thsupport ofthe c O I l l I ~ l U n i t y board anone or more community-based nonprofit organizations,In Bed-Stuy, t.he partnershif program currently has five smal proects in construction or about to starAll call for two-family homes, withousehold incomes starting a$28,000. All are beirig developed blocal Brooklyn bu.ilders, includintwo African-American firms from thimmediate neighb.orhood, with thsupport of church and communitdevelopment groups.The partnersb.ip prograPl offerhomeownership opportunities aneconomic integration that mancommunities desperately want, anhas done so without significant displacement. I t fills a t ~ c a l affordable housing need for working famlies earning $25-$45,000 annuallwho are unserved by low or markerate housing. The program is alsbeginning to reach lower incomhomeowners through limited divdend cooperatives, additional subsdies and new financing mechanismsWhile moderate and middle income housing may not be the firspriority of a community, it is almosalways part of the ove..rall plan. Whethis is the case, the Iiousing Partnership is available to help.Kathryn WyldeHousing PartnershipDevelopment Corp.

Glazer replies: We acknowledgthe partnership works through locanonprofits and b u ~ l d e r s . Howeverthe Bed-Stuy story doolt with broapolicy issues an.d on this level thpartnership does compete with locagroups. There's a limited amount osubsidy dollars and ( l large portioof hese are going to partnership proects, which are part ofa city housinplan that didn't incl.ude c o ~ m u n i tinput. This doesn't happen in a vacuum-it's taking place at the expensofdevelopment inspiredand createby local organizations.

Editor's note: City Limits wel-comes letters from our readers.We ask that you try to keep yourletters to 300 words in length.


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,WORKSHOPPROJECT DIRECTOR. First director of "local enforcement unit" forManhattan CB3. This attorney will hire & lead staff of 2 lawyers,3 organizers and 1 paralegal to do housing preservation and antidisplacement work. Will work closely wi local advisory committees & other CBOs. Exp in tenant advocacy essential. Salary:$50K +,wi exc benefits. Resume, references and writing sample:Wayne Hawley, MFY Legal Services, 41 Avenue A, NYC 10019.

EMPLOYMENT COORDINATOR. Assisting business coordinator wicompiling monthly statistics and reports for OBD. Marketservices to businesses and applicants. Tie services into publictrain ing and employment programs where applicable . Alsooutreach to business. Salary: $18K+. BA in urban planninglstudies preferred. Resumes: Flores Forbes, Woodside on theMove, 58-14 Roosevelt Avenue, Woodside, NY 11377.

DIRECTOR OF TRAINING. Citywide nonprofit housing organizationseeks person to oversee training of tenants in self-managementand cooperative ownership. Experience with low income housing, participatory education, staff supervision preferred. Salarynegotiable based on experience , Send resume to Susan Wefald,Urban Homesteading Assistance Board, 40 Prince St. , NYC10012

HOUSING ORGANIZER. Responsibilities: Organize tenants, counselon legal rights, negotiate wi landlords, agents & attorneys. Somecourt work. Paralegal training provided. Requirements: Goodcommunicat ion skills, oral and written. Spanish desirable . Salary: Commensurate wi exp, benefits. Resumes: Good Old LowerEast Side, 525 E. 6th St. , NYC 10009. Att: Ed Delgado, Director.

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EXECUTIVE DIRECTOR. Nonprofit neighborhood development corporation seeks energetic self starter with experience in management, planning, fundraising and organizing . Starting salary:$29,000 + exc benefits . Resume: Search Committee, Neighborhood Housing Services, 127 Beverly Road, Brooklyn, NY 11218.

HOUSING CONSERVATION COORDINATORSEXECUTIVE DIRECTOR. Nonprofit housing advocacy organization serving Clinton community in Manhattan for the past19 years seeks an Executive Director to manage a 30person/$1 million agency. Activit ies of agencies includetenant advocacy and legal representation , technical assistance and weatherization .Requirements : minimum of three years experience inmanagement of nonprofit community-based housing organization; good verbal (including public speaking) andwritten communication skills required; proven fundraisingand government contracting ability ; successful experiencein supervision of staff; proven fiscal management, budgeting and accounting skills; knowledge of issues affecting lowincome tenants and neighborhoods; and knowledge ofHPD and DHCR programs helpful.Responsibilities: work with and report directly to theBoard of Directors; responsible for the administration, coordination and overall implementation of organization's activities and programs; responsible for supervision and direction of staff; responsible for administration of government contracts and fundraising ; and work with staff to provide central vision and focus for organization's activities.Salary: $40,000 plus benefits.Start date: July 1, 1990.Send resume to: HCC Search Committee,

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