Community Benefits Agreement News Weekly Roundup

October 17, 2014 -- Partnership for Working Families


Developer, city finalize lease to turn vacant Kingsbridge Armory into ice center
New York Daily News
By Ben Kochman
October 16, 2014

The developer of the Kingsbridge National Ice Center announced Thursday that it had finalized a 99-year lease with the city to transform the Armory into a nine-rink ice palace. The development team will pay five percent of the ice center’s revenue plus an annual payment in lieu of taxes on the city-owned structure, said a city Economic Development Corp. spokeswoman, though she could not estimate the lease’s annual value to the city.

The center, which will be developed by former Deutsche Bank executive Kevin Parker and run by NHL great Mark Messier, will invest roughly $350 million in private funds into the redevelopment of the 750,000-square-foot site on W. Kingsbridge Road, which has been vacant since 1996.

The City Council approved the ice center in December 2013, but the project was stalled since then, as three former members of the development team sued Parker in a bid to get an ownership stake.

Jonathan Richter, Jeff Spiritos and Marcos Wignell claimed that Parker squeezed them out, after they helped steer the project through the city review process. But a Bronx judge tossed the embittered trio’s claims in a ruling earlier this month — clearing the way for the ink to dry on the lease.

“Reaching this juncture caps a monumental effort from community partners, elected officials and local residents who joined us in dreaming big – in supporting our vision,” Parker said in a statement released Thursday.

Still, skaters shouldn’t start lacing their skates just yet. The blueprints are still being drafted and construction is not expected to start until at least 2016, said a source familiar with the plans.

The finalized lease does activate the landmark Community Benefits Agreement crucial to the project’s approval by the city. Developers promised to pay workers a living wage, provide free ice time for area residents and set aside 50,000 square feet in the renovated building for community use.


Letter: Find the win-win in community benefits
Detroit News
By Stephanie Chang, Democratic candidate for state representative, Detroit
October 13, 2014

Change is hard, and Detroit is certainly going through plenty of changes. We can all be excited about the numerous development projects taking place in Detroit if we figure out a way to make sure we all get to the finish line together. I am very disappointed by the comments by the head of the Detroit Economic Growth Corporation earlier this week (Re: The Detroit News’ Oct. 7 article, “DEGC:‘Community benefits’ ordinance bad for Detroit”).

I hope that future conversations about development in the city and the possibility of a community benefits ordinance hold a spirit of finding win-win solutions. False or exaggerated claims about community benefits agreements and economic development without any supporting evidence have no place in a rational discussion about the future of development in our city.

The head of DEGC wants to talk about the linkage between community benefits and economic momentum. When considering other issues, many choose to compare Detroit to other cities as we mark our progress, so let’s do that. Let’s talk about economic development and community benefits in this same vein: What do developers, negotiators and municipal leaders in other cities have to say about community-benefit agreements?

In 2008, at the deepest point of the recession, Pittsburgh and other local entities developed a community benefits agreement for the Pittsburgh Penguins development. In return for $750 million in public investment, the coalition negotiated $32.5 million in direct community benefits including a first source hiring system for newly created jobs generating $4 million annually for local residents; a full service grocery store where 95 percent of the employees are people of color and 65 percent live in the community; among many other benefits to the community. These are the real outcomes that happen when there is a legally binding agreement.

In Oakland, Milwaukee and the Northwest Bronx, community benefits agreements have helped the local economy recover in a way that both makes profits for developers and also provides good jobs, affordable housing, and other important benefits.

Community benefits can help ensure that developers gain public support and address concerns early in the process rather than dealing with issues later. Community benefits help ensure that residents feel their taxpayer dollars are being spent in their best interest. Community benefits can allow municipal leaders to lead in areas of development, housing, jobs and the environment.

The bottom line is this. Saying that a community benefits ordinance will somehow “abruptly stop” all of Detroit’s economic momentum is not only false, but it is also incredibly unproductive and counter to the momentum we already have as a city and need to continue to build.

I applaud members of the City Council for taking steps to consider a community benefits ordinance. Detroit can follow other cities’ lead and hopefully become a leader in this area. There is still a long way to go to make sure that all Detroit residents, taxpayers and business owners thrive alongside the gains of developers in Detroit. I know that we can get there together but only with respectful dialogue based on facts.


DEGC chief to council: Don't derail Detroit's recovery
Detroit Free Press
By Tom Walsh
October 7, 2014

Detroit City Council is preparing an ordinance that, if passed, will choke off investment in the city and "undermine our economic progress well before our recovery has hit critical mass," the new CEO of the Detroit Economic Growth Corp. (DEGC) warns in a strongly worded letter being delivered to council members today.

The ordinance would require developers, when seeking subsidies worth $300,000 or more, to enter into so-called "community benefits agreements" (CBAs) with community groups, setting targets for local hiring and awarding of contracts to Detroit-based businesses.

While well-intentioned, a law mandating CBAs with different local groups for each major investment deal could create a red-tape nightmare, adding extra time and costs to each project — and potentially introducing corruption into the system, says Rodrick Miller, the DEGC president hired in August, who previously ran the New Orleans Business Alliance, a similar public-private development agency in Louisiana.

"I think it will be the most damaging piece of legislation that the city can have. We still haven't hit critical mass as it relates to economic expansion in Detroit. This will make sure we don't hit it, and I'm really concerned about it," Miller told me Monday.

Mayor Mike Duggan hasn't yet weighed in publicly on the proposed community benefits ordinance, but if he joins Miller and the DEGC in opposing it, it may prove to be one of the first major tests of the new-found harmony between the mayor's office and city council.

Language for the proposed ordinance has been drafted in recent months with the help of City Council President Brenda Jones' office, spurred in part by concern over Marathon Petroleum's recently disclosed shortcomings in hiring Detroiters after it received a $175-million tax break in 2007.

Calls to Duggan's office and city council for reaction to Miller's letter today did not yield an immediate response. Miller said he met with council staff two or three weeks ago. "They're very aware of my position, of the arguments we've made, but they don't seem to be slowing down," he said.

"I can see that this ordinance was born out of frustration with past deals which went awry," Miller wrote in his letter to council members, but he said a better approach would be to use and enforce existing tools to assure benefits for Detroiters, rather than adding new barriers and complexity for business.

"We know from years of recruiting companies that Detroit still has big obstacles to overcome related to costs, image, and workforce to compete against other cities and our surrounding suburbs," Miller wrote, adding, "We are, in effect, paying businesses to jump over the barriers they face: high taxes, questionable services, low adult literacy, blighted surroundings and negative perceptions. If we raise the height of the barriers with CBAs we will simply have to pay more in public incentives to get businesses to jump over them. We can't afford that. Isn't it more cost effective to lower those barriers?"

Miller is asking the right question, raising the right issues in terms of regulatory policy. It's an especially critical decision at this moment in time for Detroit.

Just as the city prepares to emerge from its historic Chapter 9 bankruptcy, just as Emergency Manager Kevyn Orr hands back the reins of power to Detroit's elected officials, this would be the absolute worst time to repeat the blunders of past city governments by making it more risky, more complex, more expensive to invest and do business here.


Langley Park rallies for equitable Purple Line development
The Sentinel
Montgomery County, MD
By Rebecca Guterman
October 14 2014

“Si se puede, yes we can!” cried residents of Langley Park in response to Gustavo Torres, Executive Director of the immigrant advocacy group CASA de Maryland.

Hundreds of residents and community representatives gathered at St. Camillus Church to rally for equitable development of the Purple Line through their area and form a “Compact” with state and county organizations in charge of development. The Purple Line, a 16-mile light rail that would go from New Carrollton to Bethesda, is a $2.45 billion project scheduled to start construction in 2015 and open in 2020.

The compact is not an objection to the Purple Line, but rather a partnership to make its development beneficial to the community, according to CASA Director of Education Alma Couverthie. CASA spearheaded the creation of the Fair Development Coalition in 2010, which is leading the compact efforts. “We want to make this as inclusive and as broad as possible and it is a set of principles that the group adheres to that would guide the developments and also the creation of opportunity,” Couverthie said.

Representatives from state agencies such as the department of transportation and the Maryland Transit Administration, in addition to Lt. Governor Anthony Brown and local elected officials, were present to help form the compact as well. Brown said he supports the Purple Line for the estimated 6,500 jobs it will create and 69,000 riders it will serve and pledged to look after Langley Park interests.

“It’s going to revitalize our community with affordable housing and community jobs right here,” Brown said. “You need training for the jobs? We’re going to train you. Housing? More affordable housing. And jobs, we’re going to work with small business to create family-supporting jobs right here in this community.”

After hearing from speakers and calling representatives from Prince George’s and Montgomery counties up to the stage, residents split into sessions by topic, including jobs, housing, education, small business and transportation and safety. Community members voiced concerns about jobs, housing prices, and small businesses that might be negatively affected by the Purple Line.

New Carrollton resident Paola Espino said she was most interested in how the construction could benefit local workers. Her husband works for himself providing dump trucks and construction trailers to support Espino as she takes care of their three children. “I know that Maryland is giving money for the construction, so we want all the jobs to stay in Maryland,” Espino said.

One of the members of the church, Kevin Hernandez, came with other parish members because he grew up in the Langley Park area. Hernandez said though the housing and employment breakout session could have been more informative, he still plans to come to future work sessions to stay updated. “Even though the (Langley Park) community is not known for a lot of good reasons...the community is a treasure and I’m here to protect that. I don’t want everyone to be displaced,” he said.

Potential displacement especially concerns the many long-term renters in the area. In the past 30 years, rental housing in Montgomery County has gone from less than 10 percent to more than 30 percent, according to Matt Losak, executive director of the Montgomery County Renters Alliance. “It is likely that the Purple Line will increase the value of the neighborhoods it serves and when that happens, it’s an opportunity for unscrupulous landlords to raise rents beyond what is affordable to the communities that lived there,” Losak said.

The Purple Line could also have an impact on local stores, according to business owners. Susanne Delyon, president of the Expo supermarket, spoke to the crowd about how construction had already taken up some of her parking spaces and driveway for delivery trucks. “I’m very happy that the Purple Line is coming,” she said. “But my concern is that they did not address to we are going to be compensated for our loss of income.”

The Purple Line Compact was inspired by the Community Compact for the Red Line transit project in Baltimore. It was created in 2008 with over 70 signatories including government agencies and Mayor Sheila Dixon, according to the Fair Development Coalition.

The rally was the first of three workshops for community input on the compact. The second will be held Oct. 25 in Montgomery County and the third will be Nov. 17 in Prince George’s County.


Purple Line Community Compact plan kicks off in Silver Spring
Gazette.Net: Maryland Community News Online
October 9, 2014
By Raisa Camargo

While plans continue for a Purple Line light rail, a community compact is working to safeguard residents and local businesses from being priced out because of redevelopment. Casa of Maryland, an immigrant advocacy group, held a kickoff rally Thursday evening in Silver Spring to support the Purple Line Community Compact. The compact is a written agreement in which stakeholders and the community address expanding affordable housing, enhancing job workforce opportunities and aiding small businesses through the construction phase.

Gustavo Torres, executive director of Casa of Maryland, one of the coalition’s partners, said he expects the agreement will be completed by Christmas. “We are going to celebrate that the Purple Line is coming to our communities, but, also, we are going to speak about very serious issues, like jobs,” he said. “It’s not only about transportation, but smart growth, and that is exactly how we see it.”

It’s the first step to what organizers believe will involve two months of negotiations with Purple Line stakeholders, including the Maryland Transit Administration, Montgomery and Prince George’s county governments, the University of Maryland, local businesses, nonprofits, labor unions, faith-based organizations and neighborhood associations.

The Fair Development Coalition, a CASA of Maryland-based group, is spearheading the compact. Community workshops to get input from residents are scheduled for Oct. 25 in Montgomery County and Nov. 17 in Prince George’s County.

The light rail line, estimated at $2.37 billion, would extend from Bethesda in Montgomery County to New Carrollton in Prince George’s County. It would connect Metro’s Red, Green and Orange lines, as well as the Amtrak and MARC stations. Construction is expected to begin in 2015. It is projected to start up in 2020.

Some business owners said they are worried about losing money while the Purple Line is under construction. An estimated 300 people registered for Thursday’s event to discuss concerns of that type.

Susanne Delyon, president of the Expo E-Mart, told the crowd she supports the Purple Line. “I am really happy that the Purple Line is coming. Of course, we know the importance of the Purple Line,” she said. “But my concern is that they did not address to us the impact of the Purple Line in our business and how we will be compensated for our loss of income.”

Carlos Perozo, a member of the Fair Development Council, said he spoke with MTA officials to see if they can guarantee that customers can access stores during construction. “We need to know way ahead in advance how the construction is going to happen,” he said.

In 2008, a Red Line Community Compact detailed several goals about construction of the Red Line. The compact included businesses, residents and service providers. Then-Mayor Sheila Dixon of Baltimore issued an executive order to create a steering committee to implement the compact, the Fair Development Coalition said.

In partnership with the state and counties, the Purple Line Compact would create a steering committee to oversee implementation of the agreement. Some goals outlined include ensuring proper training opportunities for residents, tracking and setting clear goals to hire minority and disadvantaged workers, creating a mitigation fund to compensate small businesses, and establishing a small-business advisory board to work with MTA and counties.

To prevent rent increases and displacement, the association is advocating for a commitment to replace any redevelopment with affordable housing and supporting tax-increment financing policies, said Robert Goldman, president of Montgomery Housing Partnership. The creation of a Purple Line Housing Trust Fund and advisory committees are among the goals the compact will outline throughout its workshops.

Jorge Sactic, a native of Guatemala, opened Chapina Bakery on University Boulevard in Langley Park 10 years ago. He is president of the Langley Park Small Business Owners Association, which represents 100 businesses, including some in Silver Spring. Sactic believes it will be difficult to provide financial assistance to accommodate small-business owners after the Purple Line is constructed. He hopes there will be more concrete solutions in the coming months.

“We feel that we’ve been in the area almost three decades. We have helped with our taxes, we have created jobs and it’s not fair that these people are creating these projects that will sweep us out,” he said. “The only thing we got at this point is just sympathy — but that won’t get us anywhere.”


Chow, Wynne, in favour of community benefit agreements
By H.G. Watson
October 6, 2014

Toronto mayoral candidate Olivia Chow tweeted that she and Ontario Premier Kathleen Wynne are in agreement on transit, after the Premier's speech at the Good Jobs Summit. On Oct 4, Wynne addressed the delegates at the summit, a combination conference and convention organized by private sector union Unifor in the hopes of jumpstarting a cross-sectorial discussion about how to ensure there are better jobs available for Canadians in the future.

Wynne spoke at length about the importance of infrastructure projects, like the Eglinton Crosstown LRT line in Toronto, in job creation, noting that along the 19km line are five priority neighbourhoods that have historically low-income and disadvantaged residents. “These groups needed to be part of every good jobs conversation, and certainly need to going forward,” Wynne said.

Built into the Eglinton Crosstown project is a community benefit agreement. These agreements call for the companies and organizations behind large infrastructure projects to work with the local community to develop job opportunities and training, according to a Metrolinx report. Wynne specifically pointed to the Eglinton Crosstown agreement as one of the ways they have been able to find good jobs for local residents.

Community benefit agreements are also a part of Chow’s recently released platform as part of her strategy for addressing youth unemployment. Almost immediately after Wynne’s speech, Chow tweeted that the premier agrees with her job creation strategy: "I say yes. Premier Wynne says yes. John Tory calls creating jobs for young people “NDP bureaucracy”. #TOpoli"

In a blog posted at about the same time, Chow was critical of John Tory, who had previously said that city staff should not be setting up “NDP-style bureaucracies.” According to a CBC report, Tory favours encouraging local businesses to employ young people. He has not yet released his full campaign platform.

Wynne did not mention Chow or the Toronto mayoralty race in her speech.