Gateway Center ll Community Benefits Agreement: A Plan to Enhance Residents and Community

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A detailed Community Benefits Agreement (CBA) has emerged between the local East New York community and Related Cos., the developer of Gateway Center Properties Phase ll. The CBA’s purpose is “to provide benefits in conjunction with the development of Gateway Center ll, and to ensure the viability of this economic resource” in a manner “that is advantageous to both the neighborhood and surrounding communities.”

The Gateway ll CBA calls for job training and development, business development, environmental sustainability, enforcement of developer obligations, and accountability.
The CBA seeks to promote the training of residents in the neighboring and surrounding communities in preparation for jobs that will become available during the construction and operation of the development. The East New York Coalition will,to the extent practical, seek assistance from the NYC Dept. of Small Business Services, local unions, community-based organizations and institutions, and employers.

To the greatest extent possible, there will be a system established for promptness of geographically targeted residents to employers as jobs become available. The Gateway ll CBA also seeks to maximize business opportunities and encourage and foster the growth of minority-owned, women-owned and local-based business enterprises. In particular, the developer will require that during the construction of the development, it will provide all construction contracts executed by the construction manager and sub contractors an agreement to use all commercially reasonable efforts to maximize the employment of M/W/LBEs and the purchase of materials from M/W/LBEs. The coalition would establish a Local Retail Outreach Initiative which would ensure that local businesses are made aware of the new retail space opportunities available in both Gateway Center ll and the Elton Street Corridor through outreach campaigns and business training seminars.

According to the Gateway ll CBA, the developer would seek to minimize potential construction impacts on the neighboring and surrounding communities through environmentally sustainable initiatives, including waste management, methane gas venting systems, reducing the heat island effect which increases summertime peak energy demand, air-conditioning costs, air pollution and greenhouse gas emissions, heat-related illnesses and water quality.

The Storm Water Retention plan would address the way storm water is delivered to Jamaica Bay to prevent runoff carrying pollutants that would negatively impact the ecosystem. The developer is committed to making sure that Gateway Center ll is being designed with landscaped areas, including vegetative bioswales, a rain garden, and perimeter landscaping designed to collect storm water runoff from the parking area and the roofs of buildings in order to filter the waterbefore being discharged into the drainage system.

The CBA calls for the developer to provide bicycle racks, a no-emission source of transportation in order to encourage the use of bicycles for people wishing to bike to the shopping center.

There are obligations for both the developer and community coalition in the CBA. The developer shall provide a sum of $3,000,000 to be paid in equal installments of $500,000 over a six-year period commencing upon 60 days after the closing of the construction loan, the final unappealable ULURP approval, the closing of the acquisition of the land for Gateway Center ll with both the city and the state, and the commencement of construction. The first half of the first installment shall be paid upon the closing of the land and ULURP approval.

Both the developer and the community coalition must provide semi annual progress reports.

Notwithstanding closing on the land, Andre T. Mitchell from Man Up Inc.!, a community coalition partner, had begun notifying the community of the elements of the Gateway II CBA throughout the entire process. “We want to make sure the community is aware and prepared to participate in the construction,” said Mitchell.

Andrew Walcott, attorney representing the ENY Coalition said, “At the time the CBA was signed in spring 2009 the recession had already started. The primary focus was jobs. That is still the issue, now. For a young, minority person in any neighborhood, especially in ENY or Brownsville, they need jobs. In better
economic times, the focus may have been different.”

Walcott said, “When the original Gateway Center l was built, there was no Community Benefits Agreement. Most of those stores over there are some of the highest-grossing stores in each chain. Whether it’s BJ’s or Olive Garden, they are all doing great. But if anyone in the community asks for help for, let’s say a tournament or a not-for-profit asks for additional funding, they haven’t been very receptive to date. So we tried to get funding in this case on the front end to prepare people for these jobs so that we don’t have to go back later on. It is very difficult to get money from these entities down the road. You have more leverage in the beginning than after the fact.”

Community Benefit Agreements are “the norm in a lot of communities,” said Walcott. “Staples Center in L.A. has a Community Benefits Agreement. I believe there is one for Columbia University.” Walcott said he looked at other CBA’s from across the country as a model for the Gateway ll CBA. “There are not a lot of them because this is a relatively new field of law to a degree. None of them have been tested in court as of yet. I did look at a few to get some guidance.”

Jesse Masyr, land procurement attorney for Related said, “Projects of a certain size are getting involved in Community Benefit Agreements. It was
not shocking that somebody would ask for it. We don’t believe they are necessary, but it was felt strongly by the Councilman [Barron]. His support was
(to us) very important to the success of the project. If it wasn’t asked of us, I assure you I don’t know of any developer who would insist on having it.”
Masyr continued, “We feel there is nothing in the CBA that we don’t feel we wouldn’t have done anyway. The idea that somebody would like us to memorialize it in a document is not offensive. We don’t feel it was necessary. We didn’t agree to anything that we didn’t feel was in the best interests of the community and the development,” he said. “The idea that there would be an effort to try to reach out to enhance job opportunities to local residents is something we believe in.”

“We encourage our contractors to purchase from local suppliers. By using a local supplier, you are increasing the economic activity in the community,” said Masyr. “How you create jobs is not always on the site, but by the economic activity.”
The community coalition took into account census data when looking at the area’s disposable income and the unemployment rate. “We knew where the problem areas are. We had a general idea what the unemployment rate was for the youth and the overall population as well,” said Walcott.

“It would be beautiful if somehow we can get one of our own businesses up to scale to fit into the Gateway Mall itself, the second one coming, if it is anyway possible. There were some discussions about that, but it never materialized,” Walcott said. “Whether it’s J.C. Penney, or Wal-Mart, or B.J.’s, none of these companies have any connection to East New York. Jobs are great, but ownership is always better. We were thinking of possibly getting a company of scale, community-based, in Gateway Center ll. Perhaps a family entertainment business or retail would be great. Unfortunately, we don’t have enough of those. We don’t own B.J.’s, we don’t own Wal-Mart. If we could place in Gateway a prime example of a thriving minority-owned business, that would have been perfect.”
There are not too many business corridors in ENY. “You have New Lots, you can consider Pitkin Avenue as part of ENY and Brownsville, parts of Pennsylvania Avenue and City Line,” Walcott said.

The Elton Street Corridor of Gateway Center ll is specifically designated for 10 local small businesses. Its purpose is so that really small mom-and-pops were not left out of the development. “That corridor leads into Gateway Center ll. There would be a lot of exposure to any of those businesses,” said Walcott. “Maybe one could grow to the size that they could fill up a big box of 50,000 or 100, 000 square feet, like a Best Buy can. It could be a tailor shop, hat store, Cake Man Raven. Who knows? Who would have ever thought Starbucks would grow as big as it has? You never know what would happen if you put it in the right location, and in business as with housing, location is everything.”

Walcott thinks “it would be great” if a community-based newspaper or a low-frequency radio station was placed in the Elton St. Corridor. “There are a lot of good things happening in ENY. You have one successful mall, and a second one coming in the midst of one of the worst recessions we have ever had. That shows the economic power of the community. You would not build a second mall if the first was not doing great, especially in a recession like this. Across the street from the mall are two former landfills. They are now becoming federal parks; 400 acres of park land with band shell area for summer concerts. That will open up in 2012. You have powerful churches. Starrett City, right next door to ENY, has its own periodical. If we had something like that in ENY, that would be great. It is an opportunity for a journalism student or journalist out there.”

“There are a lot of good things to write about in ENY,” Walcott said. “Crime has come down. Hopefully the schools are getting better to some degree. The second mall is coming. There is talk of putting a third mall where a satellite company was located years ago at the end of Franklin and Flatlands. There is definitely demand within the community. You have people from all walks of life moving into ENY now.”

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