Federal Reconstruction Funds:
Opportunities for Public Input
Prepared by Good Jobs New York
www.reconstructionwatch.net
(212) 414-9394 gjny@ctj.org 275 7th Avenue 6th Floor New York, NY 10001
Reconstruction Watch
seeks to assist low
and moderate income New
Yorkers in understanding
and influencing the
reconstruction
process. Through its
research and publications,
Reconstruction Watch
provides these New Yorkers
and the organizations
that assist and represent
them with timely
information that they can
use to participate
effectively in the
reconstruction process.
The $21.4 billion question…
• Of the $21.4 billion promised by President Bush following the
September 11, 2001 attacks, approximately $5.6 billion has been
released so far.
•
According to reports from the United States General Accounting
Office* and others, the total amount received may be less than $21
billion – and we may never know how much less.
• Community and advocacy groups have raised serious concerns
about the lack of equity, clear public benefits, and accessible public
input process in the distribution of resources.
* Report available at: http://www.gao.gov/new.items/d031174t.pdf
Types of Programs
• Federal Emergency Management Agency (FEMA) ($8.798 billion)
–
–
Funds have gone primarily to recovery-related costs, assistance to individuals, and renovation and new
construction of mass transit infrastructure.
In June 2003, additional funds were released to study health impact of attacks on fire fighters, police,
etc.
• Liberty Zone Tax Benefits (approx. $5 billion In forgone revenue, although new
estimates are lower) include:
–
–
–
Employee tax credits (for example, the Work Opportunity Tax Credit)
Depreciation allowance
Private Activity Bonds (a/k/a Liberty Bonds)
• Community Development Block Grants (CDBG) ($3,483 billion)
–
–
–
Funds from the U.S. Department of Housing and Urban Development (HUD) have been allocated to the
Empire State Development Corporation (ESDC) & Lower Manhattan Development Corporation (LMDC)
for use in revitalizing lower Manhattan.
HUD waived the usual low- and moderate-income targeting restrictions on CDBG funds.
Approximately $1.1 billion remains unallocated
• Transportation ($2,347 billion)
–
–
The Federal Transportation Administration and Federal Highway Administration, along with FEMA, will
control funds for intermodal transit projects and street level improvements in lower Manhattan
Priority projects include a WTC transit hub, Fulton Street Transit Center and South Ferry Terminal.
Breakdown of Federal Funds
Breakdown of Costs to Federal
Government
Federal Funds Authorized vs. Funds
Released
$1,159.00
CDBG
Transportation
Other
FEMA
Liberty Zone Tax Benefits
Other
Transportation
$3,483.00
Authorized
Released
Liberty Zone
Tax Benefits
$5,029.00
$10,000.00
$8,000.00
$6,000.00
$4,000.00
$2,000.00
$CDBG
$8,798.00
FEMA
$2,347.00
Figures taken from “9/11: Two Years Later: An analysis of Federal aid,” Office of the NYC Comptroller, September 2003.
Opportunities for Input
• Liberty Bonds ($8 billion authorized; $6.81 billion remaining)
–
–
–
–
The Mayor and the Governor control these resources
Allocations made so far have sparked outrage in community and advocacy groups
Public pressure through public hearings, media, etc. can have an influence on future use
Allocation of Liberty Bonds has created new opportunities to involve the public
• CDBG funds: ($3.483 billion authorized; Approximately $1.1 billion remaining)
– This is the only pool of unrestricted cash available for the post 9/11 revitalization of lower
Manhattan
– There is widespread interest in very different uses for these funds: Jobs and housing? Or
major transportation projects?
– Public comments, media pressure, and grassroots mobilization can influence use of
remaining funds
– HUD waived the requirement for public hearings when the LMDC allocates CDBG funds.
Liberty Bonds: Housing for whom?
Apartments Financed with Liberty Bonds
2500
1971
2000
# of units
Only 50 of the 935 units
financed by the State Housing
Finance Agency will rent at nonmarket rates – affordable to
households with incomes of
$94,200 for a family of four.
1500
1000
Units financed
1018
935
Non-market rate
units
500
50
0
State
City
50
0
The mayor, through the City’s
Housing Development
Corporation, is imposing a 3%
“origination fee” on City-financed
Liberty Bond projects. Funds
generated will subsidize
affordable housing outside
lower Manhattan.
TOTAL
Breakdown of Liberty Bond Housing
Allocation
$2,000.00
Authorized
$1,500.00
Remaining
$1,000.00
Approved
$500.00
Proposed
$State
City
Total
Commercial Liberty Bonds: Helping
Midtown Build Office Towers?
$400 million for FC
Ratner/The New
York Times?
$650 million for
Durst/Bank of
America
$80 million for
InterActiveCorp
Breakdown of Liberty Bond
Commercial Allocation
$6,000.00
Authorized
$4,000.00
$400 million
for Larry
Silverstein/7
WTC
$10 million South
Street Seaport
Convention Center
$113.9 million for
FC Hanson/Bank
of New York
Remaining
$2,000.00
Approved
$-
Proposed
State
City
Total
CDBG Funds Allocated
•
A total of $3.483 billion has
been allocated to the ESDC
and LMDC through HUD.
Breakdown of CDBG funds by Use
3%
•
Approximately $1.167 billion
went to businesses.
0%
32%
•
•
•
$320 million for large firms
such as American Express
and the Bank of New York.
$574 for small businesses,
as measured by number of
employees, even though
many recipients were highend stock brokers
incorporated as individual
companies.
$280.5 million for the
Residential Grant Program.
3%
50%
12%
Business
Residential
Utilities
Marketing (incl. Chinatown tourism) $7 mil.
Small capital projects
Planning & Admin. (including long-term planning)
Source: Good Jobs New York’s analysis of LMDC’s Partial Action Plans as of
10/8/03
Pressure Points
• Liberty Bond Housing
Coalition
– Calls for using Liberty Bonds to finance
mixed-income housing.
– Current efforts include: advocating for an
affordability requirement, extension of Dec.
2004 deadline, extension of boundaries
beyond lower Manhattan.
– The City and State should extend HDC’s
3% fee policy to commercial Liberty Bonds
to subsidize more affordable housing.
• LCAN – Liberty Jobs
– The Labor, Community and Advocacy
Network is mobilizing around a plan to get
people back to work through wage subsidy
& public works programs
– Organizers are pushing LMDC officials to
use a significant portion of the remaining
CDBG funds to support high road jobs and
job training.
Officials’ Wish-list:
Gov. Pataki may want to
use the remaining CDBG
funds to help pay for a rail
link from JFK to lower
Manhattan
Mayor Bloomberg may
want it to develop the East
River waterfront.
Suggested Informational Resources
Government Oversight Reports:
US General Accounting Office:
State and City Agencies responsible for
allocating CDBG funds or Liberty Bonds:
http://www.gao.gov/new.items/d031174t.pdf
Congress Member Carolyn B. Maloney
and NYC Council Speaker Gifford Miller:
http://www.house.gov/maloney/issues/Sept11/2yearslater/MaloneyMill
erLettertoPOTUS.pdf
MayorBloomberg’s commissioned
PriceWaterhouseCoopers report:
http://www.house.gov/maloney/issues/Sept11/102202_
NYLZ_Report.pdf
Lower Manhattan Development
Corporation: www.renewnyc.com
Economic Development Corporation &
Industrial Development Agency www.newyorkbiz.com
Empire State Development Corporation
http://www.nylovesbiz.comNY
State Housing Finance Agency
http://www.nyhomes.org/default.htm
NYC Comptroller:
http://comptroller.nyc.gov/bureaus/bud/03-eports/911_report_full.pdf
NYC Independent Budget Office July
2003 report:
http://www.ibo.nyc.ny.us/
NYC Housing Development Corporation
http://www.nychdc.com/