Context & Questions: Ratner, BUILD & the "Community Benefits Agreement"

A" Community Benefits Agreement" (CBA), signed in June 2005 between eight groups and Forest City Ratner Companies (FCRC) for the Nets arena and high-rise project in Prospect Heights and Park Slope in Brooklyn, has been hailed by many as an "historic agreement", and a "new paradigm for doing development in the city."

25 elected officials at the city, state and federal level have endorsed this CBA, as have many union and labor organizations.

The CBA was signed less than ten days before the MTA bids for the Vanderbilt Yards were due.

Of the eight signatory groups, only four are incorporated, one of which is Brooklyn United for Innovative Local Development (BUILD). BUILD has no track record in workforce and small business development (the areas for which it is responsible in the CBA), and was established by Assemblyman Roger Green. In a January, 2004 press statement, under a section titled "An Open and Democratic process", Roger Green announced he was helping establish BUILD to "work within the process that is being set-up by Brooklyn Borough President Marty Markowitz to ensure community input into this historic development."

It has just been uncovered through a Freedom of Information Act request that FCRC paid $5 million to BUILD during the CBA negotiations and before BUILD received its 501(C)3 status.

After generous salaries for the BUILD core staff (3 officers) are accounted for, almost $4 million of the total $5 m illion is budgeted for an unspecified "other wages and salaries". The unidentified recipients of this $4 million will be paid during 2005-2006; the two crucial years for FCRC to receive political support for their proposal.

The $5 million was given to BUILD before the CBA was signed, so it was NOT part of compensation identified for BUILD in the CBA agreement. (The CBA details that FCRC and BUILD will seek and secure public and/or private funding for the various workforce and small business development initiatives). Furthermore, both FCRC and BUILD have repeatedly denied that FCRC has funded BUILD. BUILD denied this on Brian Lehrer's live CUNY-TV show as recently as Sept 21, 2005.

Besides seriously undermining (if not completely delegitimizing) any perceived validity of the CBA, this information begs the question: who are the recipients of the unaccounted $4 million?

Is FCRC using BUILD as a conduit to pay people with political influence to support the proposal? Or is BUILD just being grossly overpaid to shill for FCRCÍs proposal? (recall that BUILD has no experience in workforce and small business development). Will the elected official withdraw their endorsement of the CBA in light of this new information? What sort of deal did the other CBA signatories get?

PLUS: While no financial information has yet been sought on the other CBA signatories, DDDB is concerned that ACORN, another leading CBA signatory, has not spoken out on the fact that the CBA commitment “VI.b.(1): The Project Developer will make 50% of the residential units built at the Project affordable” has already been broken. The draft scoping document released on September 16, 2005, indicates that only 2,250 out of 7,300 housing units, or 31% will be made affordable.