Saturday, August 25, 2012

Crony Capitalism and Land Giveaways

It was certainly bad enough when EDC gave away $200 million worth of land at Willets Point to Sterling Equities-a charter member of the Claire Shulman Local Development Cabal. Now we're finding out that this kind of land grab may actually be part of a trend. In the Bronx, according to the Mott Haven Herald, a similar scheme has unfolded-and wouldn't you know that the developer in question is also linked to Claire's Cabal:

"When contractors employed by the housing department tore up the garden, city officials argued that the community would be better served by the construction of Crossroads Plaza, a three-building complex of affordable housing, a daycare center and commercial space that would rise there. They named veteran developer Jeffrey Levine, chairman of the Queens-based Douglaston Development, as the builder."

And the deal is:

"Officials also acknowledged that the housing department never opened the site to competitive bidding, such as a request for proposals from interested developers. Officials from the agency indicated that awarding land to developers without competition was common at the time the Bronx partners gained control of the Crossroads site. The agency did not respond to requests for written policies regarding how such decisions are made.In contrast, two other major sites in Brooklyn—Livonia Avenue and Prospect Plaza—are currently the source of competition among affordable housing developers. Both sites are similar in size to the future Crossroads Plaza, which when completed will boast over 400 housing units."

No competitive bidding and the price is right: "The land where the Crossroads project is due to rise will be transferred to the developers for a symbolic $2 dollars, documents show."

It turns out that the shady deal is even more suspect because the notorious Stanley Schlein is one of the insiders who made this scheme happen:

"Yet documents obtained by the Herald show that the Department of Housing Preservation and Development regularly extended exclusive negotiating rights to the partnership after the initial proposal, even as Schlein was twice disciplined by public agencies for improper behavior.

In March of 2006, the attorney was removed from a list of qualified court-appointed fiduciaries—lawyers designated to oversee others’ estates and finances—for mishandling cases assigned to him.

Schlein was also fined $15,000 by the city’s Conflicts of Interest Board in 2008 for his actions while chairman of the Civil Service Commission. The penalty was the result of an inquiry conducted by the Department of Investigation, which discovered that Schlein had made over 2,000 phone calls from a city office and used city employees to conduct his private law practice from the Commission’s office

Schlein for all his "heavy lifting" has the second highest equity position-18% of the Levine controlled corporation.This from an administration that prides itself on having high ethical standards because the mayor's wealth supposedly insulates him from the tawdriness of corrupt insider land deals. Give us a break.

This deal-much like the one crafted by EDC over at Willets Point-should be put to an immediate stop and the land in question put out to competitive bid. The Bronx has already seen one outrageous non-competitive bid over at the defunct Bronx Terminal Market where Deputy Mayor Doctoroff deeded the property over to his old friend Steve Ross at Related.

This is the kind of crony capitalism that has characterized the Bloomberg administration. The mayor talks piously but acts no better than a Tammany ward healer.