Volume 22, Number 53 | The Newspaper of Lower Manhattan | May 14 - 20, 2010
LMDC says city is sitting on millions and doing nothing
By Josh Rogers
The city is sitting on at least $60 million of Lower Manhattan Development Corporation (LMDC) money meant to help Downtown recover from 9/11, the corporation said this week.
David Emil, president of the LMDC, for the first time on Tuesday night presented a detailed look at how much money is left of the $2 billion 9/11 package Congress gave to help Lower Manhattan rebuild through the newly-created corporation.
The LMDC transferred hundreds of millions of dollars to the city, mostly for park and other projects completed or underway, but the $60 million is set aside for city programs that have not been created yet, have not been fully utilized, or are on hold.
In 2008, Mayor Mike Bloomberg said the corporation was an unnecessary bureaucratic layer in the rebuilding process and was no longer needed.
At Tuesday night’s meeting of Community Board 1’s World Trade Center Committee, Emil also revealed that:
• About $112 million of the $2 billion is not committed to a specific project.
• The corporation still has about $600 million left in the bank, but most of it is contractually committed to projects. Emil said an important reason for the LMDC to continue to operate is to make sure the rest of the money is spent appropriately.
• There is likely to be about $19 million available soon for grants to cultural and community organizations in addition to the $34 million already paid out of these funds. A new application process for the grants could be announced at the corporation’s next board meeting in a month.
• The LMDC has almost $6 million in administrative fees left that are not committed to contracts or its current lease across the street from the World Trade Center (or a total of $13 million in remaining administration funds).
In addition, there is still about $25 million of LMDC money left in a $143 million job creation and retention program under control of the that Empire State Development Corp., according to an agency spokesperson, who added that Empire State continues to look for ways to use the money for Lower Manhattan.
Julie Menin, chairperson of C.B. 1 and an LMDC board member, said it was outrageous that there was still so much money left with all of the pressing needs in Lower Manhattan.
“We’ve had many years of argument between the city and state on so many issues, which is causing massive dysfunction,” she said.
With funding from Congress, the corporation was set up at the end of 2001 by former Gov. Pataki, who granted the city an equal number of board appointments after Bloomberg took office in 2002. But governors have always exerted more influence over the LMDC than the mayor.
C.B. 1 has been pressing for a detailed accounting of the money for years. “This is information that should be presented to the public regularly, Menin said.
Emil said the unused city money includes almost $12 million in an affordable housing fund, $30 million for the reconstruction of Chatham Square, $3 million in a school improvement fund and a $14.6 million grant program to encourage Fulton St. retail shop owners to improve their storefronts.
He said few businesses were interested in the storefront program, but Andrew Winters, director of the Mayor’s Office of Capital Projects, disputed that. Winters said just over 50 percent of the eligible businesses, 79, have signed up for the program and preliminary work will begin this week. Winters, also a former LMDC planner, said there will be money left over in the fund if all businesses do not sign up for the program.
A mayoral spokesperson did not respond to questions about other parts of the LMDC money.
Much of the affordable housing fund has languished for many years. Pataki and Bloomberg first announced the fund seven years ago. At the time it was to provide 300 below market apartments at the Tribeca development site that came to house Whole Foods, condos, some below market rentals. Five years ago, the pair announced they were shifting $45 million to other sites in Lower Manhattan in order to preserve and build 3,200 affordable units.
Emil said almost $12 million in the fund has no specific purpose. “The city has been working on how best to allocate it,” he said.
Some of that money was once intended to convert low-rise commercial buildings on Fulton St. into affordable apartments, but that idea was later scrapped. There is also about $4 million left in the money pegged to the Tribeca building and $3 million in the fund to acquire and renovate rundown tenements in Chinatown and the Lower East Side. Two middle income complexes, Knickerbocker Village and Masaryk Towers, are also expected to get a total of $11 million intended to keep rents and maintenance charges down.
At the Board 1 committee’s March meeting, Emil gave a small peek at some of the numbers but he did not turn over any of the information to the board or the public, despite the board’s formal request and a Freedom of Information request filed by Downtown Express.
At the time, the Express estimated the remaining uncommitted money was about $295 million, based on Emil’s brief presentation and an analysis of corporation documents.
The number is now roughly $262 million - $282 million — $112 million from the general fund and between $150 million - $170 million from a separate fund intended to compensate public utilities for 9/11-related work.