18
THE CITY GROWS UP AND UP
“Government’s role is not to command, but to catalyze, not to dictate development but to create the conditions that will allow it to take place.”
—Bloomberg to British conservatives, 20071
The Conservative Party of Great Britain welcomed Michael Bloomberg like a superstar when he spoke at their annual conference in the seaside resort town of Blackpool. They laughed at his jokes, like the one about how an American can’t speak in Britain without quoting Churchill, in his case, twice that day. He also made a prescient comment then in late 2007, about how the global economy was sliding into bad times because of our “borrowing bacchanalia.” A year later, the Great Recession hit and, as he predicted, the world suffered a massive economic meltdown.
There was more tucked into that speech than old jokes and savvy forecasts, however. Bloomberg also gave a very telling explanation of how he saw his role as mayor, how he believed in government unlike many in his financial stratum. He did not think government should be dismantled like some of his Republican friends. He thought government should actually work.2
A few of his goals were standard for city leaders. A mayor’s first duty is to provide a decent quality of life—that includes protection from crime and terrorism, clean streets and decent schools, and regular garbage pickup. Second, the public’s money must be kept safe, and the budget must be balanced with a good bit tucked away for the inevitable bad turn in the economy.
Still, the real meat for that conservative audience was in the third and fourth items on his list. His third task, he said, was to “unleash and incentivize the private sector.” And finally, he wanted to lay the groundwork, sometimes literally, for houses and offices for the masses of people who were steadily moving into the cities, especially his own.
From the first day of his tenure, Bloomberg had touted New York like a cheerleader, projecting that one million more people would live and work in the city by 2030. The question, of course, was where? Building to prepare for a bulging city was fuel for the economy, and Bloomberg would help create the beginnings of a building boom that would continue long after he left office. “Government’s role is not to command but to catalyze,” he stressed that day in England, “not to dictate development but to create the conditions that will allow it to take place.”3
The business community in New York, much like the British conservatives in Blackpool, applauded such talk. Developers wanted the mayor to build public amenities like his new subway line to the underdeveloped West Side of Manhattan and to hand out fat tax benefits or low-interest bonds, to get rid of complicated and restrictive zoning and then, basically, move out of the way. For the builders and the architects and the construction workers of New York, Michael Bloomberg was their kind of guy.
While Bloomberg saw his job as something of a layup shot for the developers in his city, he would also demand environmental protections. His elaborate PlaNYC in 2007 was an outline for such progress. He also wanted the city to return to its waterfront, by converting the wharfs and old ports into parks and clusters of housing and businesses with access to the shore.
Plus, Bloomberg was a strong believer in the power of capitalism and the wisdom of the markets. He enjoyed their rewards personally, and he argued that business—from start-up entrepreneurs to giant corporations like Google—made a city thrive. They helped with entry-level jobs to bring people out of poverty. Better businesses gave the middle class jobs for the necessary stability and even provided the wealthy with the means—ideally—to pay city taxes or, at the very least, to spend money on local luxuries.
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For decades New York City seemed off-limits for big, grandiose projects after “master builder” Robert Moses had bulldozed too many areas after the Depression and World War II, all in the name of progress. Moses lost power by 1968 and died in 1981,4 but the city was slow in regaining its building muscle. Mayor Koch managed an important affordable housing program and other commercial developments to lure businesses around the city, and David Dinkins helped re-create a bustling Times Square, but every move to develop a part of the city was excruciatingly slow and difficult.
Bloomberg and his development team worked hard to defy what many saw as the Moses curse.5 By the time he left office, developers had either built or started or proposed massive projects in every borough. There were alluring new parks around the Brooklyn Bridge and the High Line, Manhattan’s elevated park, Hunters Point in Queens, and the High Bridge linking Harlem to the Bronx, and even Governors Island off the tip of Manhattan. There were proposals for new schools and libraries—all to help lure development.
There was a new way to pay for a $2.4 billion subway extension from midtown Manhattan to the West Side of the island. Under Bloomberg’s plan, the subway line conceived in the 1920s and stalled in the 1970s could be built if the city essentially paid up front. The city issued bonds with the expectation that the burst in new construction would eventually provide tax revenue to pay back these loans. The “value capture” plan or “tax incremental financing” took longer than expected, since the economy slowed in 2008.6 But the extension would have taken decades for the old state-controlled Metropolitan Transportation Authority to do on its own. Instead, work started on the Bloomberg extension in early 2008, and the new station at Thirty-fourth Street opened in 2015, giving new life to a dreary patch of Manhattan’s West Side.
A favorite project of the engineer/mayor was the massive $4.7 billion Water Tunnel No. 3 to guarantee fresh water from upstate reservoirs. It was “one of the largest infrastructure projects in the city’s history,” Bloomberg said after the completion of the Manhattan leg of the project.7 He insisted on visiting the site deep underneath the city to talk to the Sandhogs, the way the engineers in Local 147 liked to be called. At one point, the mayor asked the chief engineer when the tunnel would be completed. His troops “all had mortgages,” the union boss explained, and the full tunnel would “not be finished in your lifetime.”
The $4.7 billion addition to the tunnel also offered some insight into the way Bloomberg dealt with pressure from outsiders, even powerful friends. In the summer of 2005, John Whitehead, a prominent New Yorker who knew Bloomberg socially, wrote the mayor to complain that work on a planned section of the water tunnel had disturbed neighbors in his posh Sutton Place enclave on Manhattan’s East Side. Whitehead wrote in his letter, “We would like you to know that our community is aroused” by the blasting and vibrations caused by the Sandhogs’ work. A few weeks later, Peter Madonia, Bloomberg’s chief of staff, wrote back to Whitehead explaining that while the mayor recognized the problem, Whitehead’s area was the best of several being considered for “one of the City’s most important infrastructure projects.”8 Translated, the mayor gave the tunnel a priority over his rich friends in Manhattan.
At first, Bloomberg’s developments were dictated by the needs of a battered city and its crushing deficit. He canceled former mayor Giuliani’s grand plans to spend $800 million on lavish new sports palaces for the Yankees in the Bronx and the Mets in Queens.9 Bloomberg also surprised his friends on Wall Street by backing out of a deal to build a new New York Stock Exchange. The city would have to buy nearly half a billion dollars’ worth of property for a new building—a costly venture with Bloomberg facing a $4.7 billion budget deficit.10 By the time he left city hall, however, the economy and the city’s budget had made it possible to add elaborate new stadiums for the Mets and the Yankees—with the city contributing nearly $500 million to each for extras like parking lots or site repairs (plus an estimated $480 million in city, state, and federal tax breaks).11
In Brooklyn, Bloomberg and his team supported the building of the Barclays Center, an arena that would eventually be attached to a business and residential complex. It was a classic development above and near a transit hub, but it drew plenty of opposition from old-line Brooklyn residents. They argued that the traffic on game days—it would be the home for the Brooklyn N
ets—could suffocate the entire area. And there was widespread concern about one proposed design that looked like the upended half of a huge barrel before a new round of architects from SHoP created a giant bird’s nest, as much sculpture as architecture.12 The Barclays Center also had plenty of government help (estimates ran to more than $2 billion in city and state benefits by 2008,13 four-plus years before it opened). Bloomberg was so pleased with the project and its prospects for giving the city another financial boost that he held his last State of the City speech at the arena.14
Finally, perhaps Bloomberg’s most important venture for his own personal legacy was a new graduate school on Roosevelt Island that began to take shape after he left office, some of it with a generous helping from Bloomberg’s considerable stash of funds.
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How did all this happen? Development is as complicated as the economy and the humans who live in it, of course, but it is worth focusing on two important events in the Bloomberg years. One was Dan Doctoroff’s push to win the Olympics in 2012. The other was the drive by Amanda Burden, Bloomberg’s planning commissioner, to rezone the city.
Doctoroff, who would be deputy mayor for economic development for nearly seven years, was widely viewed inside city hall as the son Bloomberg didn’t have. A New Jersey native and graduate of Harvard and the University of Chicago Law School, Doctoroff was a tall, striking figure whose years at Lehman Brothers and a private equity firm called Oak Hill Capital Partners provided his cushion while he worked for $1 a year, like the mayor. Doctoroff did not hide his views or his intelligence, and he could suddenly begin to shout when he disagreed with someone (including journalists). People either loved working for him or they took early retirement. (When he left city government, the talented but mercurial Doctoroff skillfully managed Bloomberg’s prize asset, the mayor’s multibillion-dollar data and media business, Bloomberg LP, until the owner returned from city hall.)
Burden—that is, Amanda Jay Mortimer Burden—was then the fifty-seven-year-old daughter of the elegant Babe Paley and a frequent nominee for best dressed in the fashion courts of New York. She also had a degree in urban planning from Columbia, and she had helped develop the landfill in Lower Manhattan into a well-run, resort-like community called Battery Park. Burden knew Bloomberg slightly from the same social circles. She gladly escorted the candidate to places ripe for development like East Harlem, the under-loved sections of Brooklyn’s industrial waterfront, and Manhattan’s Lower East Side.15
Bloomberg quickly appreciated that beneath all that expensive couture and the dismissive title of socialite, Burden was a smart urban planner, knowledgeable about the most arcane and convoluted city zoning issues. He admired her enthusiasm and, most important, her skills with people. Doubters could be reminded that at Columbia University, Burden’s master’s degree thesis on waste management was widely viewed in the department that year as a must-read.16
Burden and Doctoroff were not exactly a team, but they both worked to reinvent the city.
Doctoroff had been trying to lure the Olympic summer games to New York since 1994, and when the Olympic judges said no for that round, Doctoroff and his supporters immediately began aiming for 2012.17 When Bloomberg hired him to be deputy mayor, he knew Doctoroff would be focused on his elaborate plan to turn the city’s five boroughs into a massive Olympian campus. But he also expected Doctoroff to serve another mission—this Olympics plan had to be good for New York City even after the athletes and their fans had moved on. Doctoroff and his lead planner, Alex Garvin, essentially did just that. They reengineered many old ideas about where the city should develop. The New York City bid was a cohesive plan to change old industrial areas into vibrant new spaces for work, play, or places to live in the city.18
The centerpiece of Doctoroff’s bid turned out to be a major problem, however. It was an elaborate stadium on the West Side of Manhattan that would stretch over a field of rail yards and, like a giant version of the Transformer gadgets beloved by wonky kids, it would convert from an Olympic arena for 86,000 to a football stadium for the New York Jets. Its ceiling would open, and underground it would have room for trucks and a subway. The stadium quickly became unpopular with two tough neighbors: the Dolan family, who owned Madison Square Garden, and, more important, then assembly speaker Sheldon Silver, who represented Lower Manhattan. The Dolans saw the stadium as competition, and they played rough, as they often did. Their ads before Bloomberg’s 2005 campaign showed sewage pouring into the Hudson River from the stadium and a bobbleheaded Bloomberg nodding to the Jets’ owner, Robert Wood “Woody” Johnson.
But Albany had the final say. It came with the secretive state body known as the Public Authorities Control Board, which met somewhat erratically in the state capital, its agenda often made public only a few minutes before a session. The three important board members (or usually their representatives) were the governor, the senate leader, and the assembly speaker—often referred to in Albany as the three men in a room who essentially controlled the state. Their vote had to be unanimous, and the top two legislative leaders refused to vote in favor of the project, arguing that the development would undermine the slow revival of Silver’s district downtown. That killed the stadium, and Bloomberg was livid.19 Publicly he said simply that “rejection of the stadium will seriously damage our chances at winning the 2012 Games.” It would also slow development on the West Side by years, he warned.20 Bloomberg would be correct about the Olympics. Despite a last-minute alternative plan for a stadium in Queens, in July 2005 the Olympic committee chose London instead of New York.
Even years after the city’s Olympics bid was rejected, Doctoroff would talk and write about it with an open nostalgia. Bloomberg, who had spent millions of dollars and too many hours supporting Doctoroff’s dream Olympics, was not big on nostalgia. After the news came out that the Olympics would go to London, the mayor responded with one of his favorite comments: “So, what’s plan B?” Plan B would take longer, but it mostly turned out to be an important branch of the Bloomberg legacy—proposals for more than 100 million square feet of new office or residential space, three more stadiums, a key subway extension, 2,400 acres of parks, affordable housing for 500,000 people, and a new graduate center for technocrats.21 In fact, plan B looked a lot like plan A, without the swimming pools or the racetracks or Doctoroff’s $2.2 billion stadium.
Some urban experts believed that by losing the Olympics, the city actually won. A team working with Mitchell Moss, director of the Rudin Center for Transportation Policy and Management at New York University, reported that within a few years after the Olympics went to London, “the New York City Olympic Plan has largely been implemented . . .” Doctoroff’s plan focused on seven areas of the city that had been studied for years but were still underdeveloped (the far west side of Manhattan, Brooklyn’s East River waterfront, Long Island City in Queens, the Flushing area, Harlem, the South Bronx, and Downtown Brooklyn).22 Those areas began coming to life under Bloomberg’s watch.
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The second bonus for developers was that Burden made certain that nearly 40 percent of the city was rezoned during Bloomberg’s reign. Before he arrived, zoning was generally viewed as a negotiation with city officials, and there were so many adjustments to the rules that sometimes it was hard to see how they even existed in some areas. Amanda Burden would earn the name “Demanda” for her forceful control over design and open space as Bloomberg’s planning commissioner. But she also doggedly pursued the first citywide rezoning in forty years. It was a crucial gift to those who wanted more stability from the city before they began to invest. That need for new zoning was especially true in areas that had been industrial sites like in Brooklyn or distant parcels like the Far Rockaways, a seaside section of Queens. As a result, during and soon after Bloomberg’s time as mayor, there seemed to be cranes and bulldozers and workers in hard hats everywhere.
Not everyone rejoiced in all this building business. There was intense criticism of the tall buildings th
at seemed to sprout overnight with little or no vetting from the community. The Bloomberg era would be remembered by many as a time when the city built up, when skyscrapers aimed higher and higher, many of them so thin they looked like the narrow “chopstick” buildings of Hong Kong.
The very rich wanted apartments in these tall thin buildings, buildings with wraparound windows. Rich people from other nations, especially Russia and China, parked their money in apartments that could run $10,000 a square foot. Some real estate insiders referred to these palaces as the world’s largest safety-deposit boxes, each a high-end security with a fabulous view.23
Critics complained that the new owners who spent only a few weeks a year in their plush Manhattan apartments left too much of the city vacant—too dark and lifeless. Many didn’t stay around long enough in a year to pay New York City and state taxes.24 Instead of lamenting the loss of revenue, Bloomberg saw these rich buyers as investors bringing money for restaurants and shopping, limos and furs, and spas and silverware, plus a small troop of workers required for each moneyed guest. “Wouldn’t it be great if we could get all the Russian billionaires to move here?” he mused.25 (This was, of course, long before Russia began meddling in America’s elections.)
Bloomberg’s development team members insisted that they did not change the rules or the zoning to allow this sudden rise in high-rises. They pointed out that since the 1960s builders collected the rights to build taller by buying development or “air” rights from smaller buildings nearby.26 A three-story-high church, for example, could sit on a lot that allowed a ten-story building. Instead of ten stories that the church didn’t want, it could sell that “air” above its three stories to a developer nearby. Some of these builders had been quietly collecting air rights until the market made it possible to use them, the Bloomberg officials noted. Developers were also allowed to offer amenities like a school or a plaza in the downstairs areas to help them negotiate ways to build up.27
The Many Lives of Michael Bloomberg Page 24
