4/01/2005

Plowing The Back Forty: Mondo QT, 3/05

By Carola Von Hoffmannstahl-Solomonoff

In post-industrial cities across the nation bulldozers are on a roll. Fueled by the power of government to invoke eminent domain: the right to claim private property in the name of the public good. In theory, fair value must be paid. But the practice of eminent domain (also called "condemnation" and "taking") is rich with examples of property owners forced to sell on the cheap. Eminent domain is traditionally employed when public facilities such as roads and bridges are built. However, in the 1950's several U.S. Supreme Court rulings enlarged the use of eminent domain by broadening the definition of public good in relation to that period's urban renewal projects. In the following decades, as countless urban policy experts hashed over the mid 20th century urban renewal mode of cities, eminent domain took a breather. But with government involvement in real estate growing, particularly in cities, eminent domain is experiencing a rebirth. Once again, the rationale is urban renewal.

The city of Albany is the New York State capital. One of the oldest cities in the nation. Like many upstate New York urban areas, Albany suffers from post-industrial malaise. Though being the seat of state government has kept it from the near death condition of other cities. Solidly Democrat for roughly a century, Albany is a one party town with an autocratic and conservative political machine culture. Class distinctions are still strongly felt. Park South is a small blue collar neighborhood; one of the last of such neighborhoods still breathing in the original, downtown settlement area of Albany. Park South covers 9 city blocks with a racially mixed population of a little under 2000. Most of whom are low or moderate income. Park South was never affluent, but it was stable and tightly knit. Yet during the 90's the neighborhood deteriorated into one teetering on the edge of desolation row. Thanks largely to the wholesale dumping of HUD subsidized tenants into the buildings of one major slumlord — and official neglect.

As Park South slid downward many long time homeowners, landlords and tenants left. Disrepair, drug trade and violent crime became the norm. In 10 years the vacancy rate in Park South doubled to twice that of the rest of the city. Yet a core of residents remained, held by loyalty to place and neighbors. Plus for some, property in Park South represented their primary investment. The value of which was eroding. Abandoning ship would have meant a crushing loss. For over a decade this nucleus of residents worked to address the issues driving the neighborhood down. Some formed a Walk and Watch — which in 2003 received an award for excellence from the state's Attorney General. All knocked repeatedly on municipal doors. Results were either nonexistent or inconsistent. Promises were made but seldom kept. Without sufficient back-up, citizen action re crime and blight produces little lasting improvement. And a whole lot of disillusionment.

Mayor Gerald D. Jennings of Albany is nearing the end of his third term and has announced he'll run for a fourth. Many residents of Park South believe Mayor Jennings never pushed consistent code enforcement in buildings known for drug activity, or in vacant ones left open to the elements by absentee owners. Nor could he be counted on to insure dependable trash removal or provide sufficient police presence. Some thought Jennings was so busy revitalizing the corporate/government enclave in the downtown area near the State Capital that he had little time for Park South. Others suspected there was a reason why Park South — and its property values — were being let slide.

In the Autumn of 2002 such suspicions were fanned when several city employees, in private conversations with neighborhood residents about the possibility of revitalizing Park South, reportedly mentioned that sections of the neighborhood were slated to be razed by condemnation and then redeveloped. Equally disturbing were comments made by then Commissioner of Public Safety Jack Nielsen at a 10/23/02 Park South Neighborhood Association (PSNA) meeting. Nielsen was a former police chief and Jennings appointee. As Public Safety Commissioner his job entailed coordinating police actions with building code enforcement. At the PSNA meeting Commissioner Nielsen in essence threw his hands in the air about the possibility of addressing crime in Park South. Citing problems caused by "an individual landlord" and a shift in the "social and economic level" of Park South's residents. Saying that the answer wasn't "for him to tell the Mayor to put more police officers over here" and that Park South residents had to "look beyond the obvious".

On the north Park South is bounded by Washington Park, a lovely old urban oasis created under the influence of Central Park's Frederick Olmstead. On the south by University Heights. Which in the words of the Albany Community Development Agency* contains "a cluster of large, prestigious educational and health facilities". Including, but not limited to, the Albany Medical Center, Albany School of Pharmacy, Albany Law School, Albany Medical College, Sage Colleges, Capital District Psychiatric Center and the Veteran's Administration Hospital. Some of these institutions belong to the University Heights Association (UHA) a not-for-profit corporation with "the primary mission of enhancing the economic vitality and quality of life of its constituents and neighbors". One of UHA's most notable members is the Albany Medical Center — which owns extensive holdings in two of Park South's nine blocks of real estate.

In early 2003 the Jennings administration officially announced that a transformation of Park South was imminent — and also acknowledged the transformation just might involve some clearance by condemnation. The full plan for Park South revitalization was to be developed under the aegis of the Albany Local Development Corporation (ALDC) a non government agency which works in tandem with the city. Mayor Jennings is an ex-officio member of the ALDC board of directors and also appoints other members. The ALDC would in turn act as agent for the Albany Community Development Agency (ACDA) a government agency where Jennings also serves.

In early February 2003, the ALDC posted an announcement on the City of Albany website seeking a consultant to assist in forming a redevelopment plan for Park South. Two months later the city announced a consultant had been chosen: Design Collective, a Baltimore based urban planning firm. Design Collective has a background in large scale public projects, a number of which have required condemnation in urban neighborhoods. Randall Gross Development Economics (RGDE) of Washington DC was also brought on board. Ultimately RGDE provided a study (Economics & Market Findings) of Park South and its environs which stressed that due to the presence of state government, educational institutions and medical facilities, "Albany is largely a rental market". Hence rental properties, rather than single family homes, are its real estate linchpin. And the best hope for redeveloping Park South.

Input into the Park South Plan was also provided by the Park South Advisory Committee: made up of "a representative group of residents, property owners and institutions". Advisory Committee members included Public Safety Commissioner Jack Nielsen. Plus heavyweight reps from the Albany Medical Center, the University Heights Association (UHA) and Jack Egan, President of the Renaissance Corporation, a non-profit entity with development ties to the UHA. Jack Egan is also CEO of Albany International Airport and a former Executive Director of the New York State Dormitory Authority. Also on the Committee was an Albany Common Council member whose ward includes Park South, as well as more upscale neighborhoods to its east. The Committee also included four small property owners and a tenant from Park South.

The input of neighborhood residents in general was solicited at a series of public meetings and workshops. At these gatherings, a sizable number of Park South residents had strong objections to aspects of what was being proposed for their neighborhood. Nobody objected to revitalization, but many objected to the condemnation approach. Plus, the plan for Park South seemed not in the making but already made; with a massive increase of student housing writ in stone. In a 9 block neighborhood where home ownership levels have shrunk to 11% and where transience has eroded civic participation. And though the city was using crime in Park South as a rationale for condemnation, the majority of buildings owned by the slumlord who contributed so heavily to the problem, were on streets not slated for knock-down.

These objections, plus an alternative redevelopment plan put forth by a group of Park South residents, were duly noted by assorted reps for the city and Design Collective. Several letters of protest were even included in an appendix to the July, 2004 draft version of the Park South Redevelopment Urban Renewal Plan. Commonly called the Park South Plan. Or simply, The Plan.

In early 2005, the Albany Community Development Agency issued an invitation to qualified bidders to offer proposals for the right to implement the Park South Plan. The invitation delineates what The Plan to date calls for:
  1. Rental Housing: "120-180 net new rental units"
  2. Student housing: "preferably under single management" with "200-400 student housing beds". Eighty percent of which will be in "4 bedroom apartments".
  3. For Sale Housing: "20 to 27 new for sale houses would be marketable in Park South in the next 5 years".

New commercial space on Park South's commercially spotty main artery is also slated, along with 50,000 square feet of office space for the Albany Medical Center. Also mentioned is the possibility that Park South will provide expansion space for the downtown campus of the State University of New York (SUNY). Long time Park South residents who wonder if official neglect will affect new residents, can take comfort in the fact that The Plan promises "City Assistance" will be provided to any new development in the form of "enhanced City services".

The genius of the Park South Plan is that though only one neighborhood appears in its title, another containing many prestigious educational and health facilities plus a major not-for-profit association will benefit as well. Making the Park South Plan two, two, two plans in one! However, plans that call for revitalization by bulldozer frequently come up against stick-in-the-mud types who cling to their homes. Or greedy folk who base the asking price of their property on increasing value, rather than a slum appraisal rate. Since the ACDA invitation informs bidders that "the preferred developer will be solely responsible for funding acquisition of all property" it's probably wise that in order "to assist the preferred developer" the ACDA, a government agency, will be "willing to use the power of eminent domain for land acquisition if necessary".

Overall, the financing of the implementation of The Plan will be handled by the preferred developer. Who will also be paying "all costs and expenses of the ACDA (including but not limited to the ALDC)". The preferred developer will "if possible, provide information regarding programs being used for financing and teams being used for construction." Let's hope the preferred developer does find it "possible" to share this info with the public via its government agency representative — the ACDA. Which after all, will be using the power of eminent domain in the name of the public good.

In order for eminent domain to be used for the Park South Plan, the Albany Common Council was required to pass an ordinance designating the neighborhood an urban renewal area. On March 21st the Council passed that ordinance 9 to 3. The Council member from The Park South Advisory Committee was on the "yea" team.

Developers are now lining up at the gate, hoping to be among the three finalists for the role of preferred developer. Many are politically generous heavyweights based in the Capital Region. Among the local candidates are State Street Partners, LTD. An entity with an "under construction" website providing only an address and phone number. That address is 355 State Street, a four story apartment building apartment building recently purchased by State Street Partners.

According to the Albany Times Union, another candidate is United Development Corporation, at 80 State Street. (There's also an "80 State Street Partners" on the Albany real estate scene. State Street seems positively packed with eponymous partners!) United is part of the United Group of Companies, a conglomerate of multi named entities that provide assorted real estate services. Several United Group entities have been involved with a number of prominent area student housing projects. In 2003, United Development and United Realty Management were hired to develop, construct and manage a $20 million student housing complex for the Renaissance Corporation, acting on behalf of the University Heights Association.

In February, a mention of United Development cropped up in another context: in news stories examining the unexpected 2004 resignation of SUNY Albany President Karen R. Hitchcock. On 02/25/05 the New York Times citing unnamed sources, claimed Hitchcock resigned as president of SUNY in order to take advantage of a loophole in state law which lets state employees dodge investigations by the New York State Ethics Commission. The loophole being that after leaving state employment, whether by retirement or resignation, a person can no longer be investigated for activities as a state employee. The Times, plus other news sources, claimed the focus of the aborted ethics investigation was an alleged kickback deal between President Hitchcock and a potential developer of what has been described alternately as a large student housing project on SUNY's uptown Albany campus, or according to a 02/25/05 story by Channel 10 News in Albany, "300 units of student housing on North Pearl Street". An area in the corporate/government section of downtown Albany. The developer involved in the alleged kickback was United Development.

Karen R. Hitchcock, now principal of Queens College in Ontario, Canada and her attorney strongly deny the story about her exit from SUNY. But with the loophole in state law making an ethics investigation impossible, allegations are left hanging in air. Not only for Karen Hitchcock but for United Development.

As said, eminent domain was a popular urban renewal tool mid 20th Century. Albany itself took a major hit in the 1960's, when Governor Nelson Rockefeller used eminent domain to bulldoze a huge low and moderate income downtown residential neighborhood in order to build the Empire State Plaza complex of government offices. Many of the homes within that neighborhood were built in the same periods as those in Park South. Some were in as poor shape as some are now in Park South. And like Park South, the neighborhood was racially mixed. If protests hadn't ensued, Rocky would have rolled his urban renewal vision up the hill into more neighborhoods — with a highway to the suburbs running beneath Washington Park. To this day, the protests that stopped Rocky from further decimating Albany's residential downtown are remembered proudly by progressive Albanians: the Empire Plaza is still reviled and lost neighborhoods still regretted. Yet by and large, not much protest about the proposed use of eminent domain in Park South has been heard. Except of course, from a sizable number of people who live or own property in Park South.

It could be that to some, the real estate visions of prestigious educational and health facilities and not-for-profit associations, and the hoped for ripple effect on property values and demand for rental housing in the upscale progressive neighborhoods surrounding Park South, seem like such good public goods that circa 2005, bulldozers have become public servants.

According to the ACDA invitation to qualified bidders, The Park South Plan is linked to a wider redevelopment strategy called "The Midtown Strategy". Planning for The Strategy will be developed with funding from The New York State Quality Communities Program. The end result to be "a strategic plan to leverage the investment opportunities and programming needs of (Albany's) institutions of higher learning". Institutions which will be served by The Midtown Strategy include SUNY, members of the University Heights Association and the College of Saint Rose. The city will partner with these institutions to address, among other things, their needs are "student housing, employee housing, commercial services, and programming/educational space". To that end the Strategy study will "take account of studies that have already been completed..". Including "those like Park South".

It would behoove other residential neighborhoods in Albany to also take into account studies relating to Park South. And to consider the methods by which the resulting Park South Plan has been, and will be, advanced. As the use of eminent domain in the name of urban renewal increases across the nation, not only low and moderate income neighborhoods are being bulldozed. Nor are only low and moderate income property owners being forced to sell. In numerous instances viable neighborhoods and thriving businesses have been made to decamp in order to make way for what government deemed bigger and better. The phenomena has become so pervasive that myriad legal challenges are being launched from public policy groups across the political spectrum.

As for Park South itself, after the preferred developer is chosen by the ACDA, that developer will be able to tweak and adjust aspects of The Plan should need arise. Plans, after all, are only maps which circumstances alter. The ACDA must approve any changes and the Common Council will ultimately have to sign off on the final Park South plan as agreed upon by the preferred developer and ACDA. Some residents of Park South have been told by city representatives that this tweaking process means a chance for the changes they desire. Some folks believe — or at least hope — this will be so. Others are less sanguine. When the Albany Common Council signed off on the urban renewal ordinance that left Park South open to the use of eminent domain, the neighborhood lost a major bargaining chip. Leaving it dependent on the word and social decency of an administration that has proved deficient in both categories.

Whether this part or that part of Park South is bulldozed, or whether the crucial slumlord who was left undisturbed for years winds up being revitalized, or even if the use of eminent domain hits a legal snag on the state or federal level, a profound destruction has already taken place in Park South. Over the past few years the weave of friendship and common purpose that held the heart of the neighborhood together in the face of crime and neglect began to unravel as conflicting interests and social divisions were sought out and exploited by those seeking to advance The Plan. Veiled threats were made and guilt was mined. People who worked for years to save their neighborhood were called spoilers and reproached for being selfish when they objected to it being bulldozed.

In a neighborhood where the true spirit of community shone forth, social wedges were driven with the skill typical to pols who ride high on the hog in old machine cities. Where the art of divide and conquer has been polished to a fare thee well, while the will and ability to provide low and moderate income people with safe, clean streets has atrophied. And where now, with the help of public money and eminent domain, the evidence of that failure can be bulldozed into a gold mine for politicians, preferred developers and prestigious tax advantaged institutions.

All in the name of the public good.

  • "We like our neighborhood just the way it is. We just want to
    get rid of the crime and drugs." — Park South resident Paul Webster, "Residents Want Voice in Improving Park South" Erin Dugan, Albany Times Union, 01/15/03
  • "We did not create this mess in Park South. Years of neglect and inaction by the city have brought us to this point. Now we are being asked to trust an administration that has failed to live up to its responsibilities and promises to us" — Park South resident Alice Rabb, "Park South residents lack details on city's plan" Letter to the Editor, Albany Times Union, 11/24/03
  • "A bulldozer is not the answer. The city is holding this over our heads...the trash is still in the streets, and the drugs are still here." — Park South resident Pat Kelly, "Developer for Park South possible by April" Brian Nearing, Albany Times Union, Albany Times Union, 02/18/05
  • "The city has just been waiting for the right time to seize our homes...They are going to steal it from us, tear it down and give it to developers" — Park South resident Thelma McCargo, "Door Open for Park South Plan", Brian Nearing, Albany Times Union, 03/22/05

Sources include but are not limited to:
  • Invitation to Qualified Bidders, Request for Proposals (RFP) For the Redevelopment of the Park South Plan Area in the City of Albany, New York. Unless otherwise noted, quotes describing The Plan are taken from this 2005 Albany Community Development Agency (ACDA) document.
  • Transcript 10/23/02 Park South Neighborhood Association PSNA) Meeting
  • Opportunities & Market Findings, Draft 3-30-04, Randall Gross Development Economics and Park South Market Study, Appendix C, Randall Gross Development Economics
  • Park South Redevelopment Plan, Implementation Action Steps, Draft 03/30/04 Design Collective
  • Alternative Plan For Park South Revitalization, Park South Concerned Citizens, Autumn 03
  • "Albany Project Attracts Interest", Brian Nearing, Albany Times Union, 03/03/05
  • "Door Open for Park South Plan", Brian Nearing, Albany Times Union, 03/22/05
  • "Renaissance works on student apartment project" Apartment Finance Today, Regional News: July-August 2003
  • "Case of Former SUNY Official Points to Ethics Law Loophole" Michael Slackman, New York Times, 02/25/05
  • "Ethics Probe May Have Led Hitchcock to Leave Albany" WTEN News, Albany, New York posted: 02/25/05 7:40 pm
  • The general topic of increasing abuse of eminent domain has been
    covered in too many places to list here. One notable document
    being: "Government Theft: The Top 10 Abuses of Eminent Domain"
    Dana Berliner, Castle Coalition, 2002.



Mondo QT: www.mondoqt.com