Bill Perkins, chair of the Corporations, Authorities and Commissions Committee, is urging Governor Paterson to investigate the $511 million dollar bond issuance by the Brooklyn Arena Local Development Corporation (BALDC) for possible wrongdoing and to halt the sale.
On December 15, 2009, the BALDC a not-for-profit corporation created by the Job Development Authority (JDA), held a bond auction to fund the construction of the arena component of the Atlantic Yards project.
However, the bond issuance is not valid on at least two grounds, outlined in a letter Senator Perkins sent to the governor.
By issuing the bonds through the BALDC, the JDA (which is a unit of the Empire State Development Corporation) avoided its statutory obligation to receive approval from the Public Authorities Control Board and the State Comptroller.
Additionally, according to a recent Court of Appeals decision, the BALDC does not have the authority to grant a property tax exemption for land leased for the proposed Nets arena. “Consequently, payments-in-lieu of taxes cannot be used to secure the bonds, and they are effectively worthless. If ESDC knowingly misrepresented the legitimacy of these bonds, this raises the specter of fraud,” Sen. Perkins writes.
“It is unacceptable that these entities would violate the public trust and subject taxpayers to hundreds of millions in debt obligations and issue debt outside the statutorily mandated review, especially during our current financial crisis” argues Sen. Perkins. “I am equally concerned by the fiction engaged in by the ESDC. Their purpose is to promote economic development in the best interest of the people of New York, not seek murky loopholes costing New Yorkers millions in property tax revenues from wealthy private developers like Forest City Ratner.”
Furthermore, it appears the ESDC was in part motivated to issue the bonds before the IRS tax exempt stadium deadline of December 31, 2009.
“Earlier this month Governor Paterson signed landmark public authority reform legislation into law. However, it is clear that some have not received the message. My committee will review these actions and continue to seek transparency and accountability on behalf of the people of New York,” Senator Perkins says.
Senator Perkins Raises Question of Potential Wrongdoing in $511 Million Bond Issuance by Brooklyn Arena Local Development Corporation for Nets Arena
The View From Here
This first year of the Barack Obama presidency has been spent setting the stage for the what’s to come. The wars in Iraq and Afghanistan are far from over, but they seem to have faded in the popular consciousness, but not for the men and women overseas fighting, their families here at home, those trapped in the war zone and the drain on our treasury. By the end of next year, we hope and pray that the president’s plan for disengagement will succeed and we will begin to see the end of this military adventure.
The global-warming crisis is the biggest threat to people around the world and it will only be worse next year, continuing to cause death by drought, flood and famine, and causing mass migrations as people move to escape rising sea levels and find food, water and resources. The just concluded United Nations climate change conference in Copenhagen has been criticized as producing no set goals for nations to achieve, but they will have another chance to set definitive timetables in Mexico at the end of next year.
For me, one of the most disheartening scenes to watch this year has been what has been called the health care debate, but which has devolved into the shameless purchase of the government by the pharmaceutical and health industrial complex.
In November of 2008 we wrote of President Obama, “The leniency shown to the turncoat Senator Joe Lieberman should also not be misconstrued as weakness. As distressing as it appears to some Obama supporters, they should keep in mind Godfather Vito Corleone saying ‘There may come a day I will ask you for a favor.’ Joe will be granting Obama favors many times in many ways for supporting him to remain as chairman of the Homeland Security Committee.” Boy, were we wrong. It has been a sorry sight to see Senator Lieberman imposing his will on the country by demanding that there be no public option in the health care bill despite the polls saying the majority of people want it, and the facts showing how much money it would save. Either Senator Lieberman double-crossed the president or Obama knew Lieberman’s position all along, but was never going to push for a public option anyway. The wiping out of the public option, and the non-consideration of a single-payer system in any form, is a triumph of money over people, and will result in more deaths by non-treatment, 45,000 last year and a population forced to pay for the profits and administrative costs of the health care industry. All of those brightly painted insurance company RV’s we see with the workers setting up tables on the street are paid for by health insurance premiums and they have nothing to do with health care, only trolling for customers at our expense.
But money saved by the people, is money lost as far as the insurance companies are concerned and they are not having it and neither will their minion in the halls of congress, cementing the perception that we have the best democracy money can buy.
So now we are saddled with supporting the lifestyles of the rich by being forced to select which crook to allow to pick our pockets. And while these corporate welfare addicts are making out beautifully, we find that Black businesses are being shut out of the stimulus dollars at the same time their communities are suffering the highest unemployment rates.
We always understood that the last thing a Black president would do is show favoritism to the Black community, but after receiving over 90% of the Black vote we did expect something approaching fairness from this administration. To be so wrong on this item is particularly painful.
They say it takes miles to bring an ocean-going oil tanker to a stop and I bet that’s a lot like changing the habits of a bureaucracy the size of the federal government, so I guess the president could be cut a little slack. Obama has a lot of work to do in this second year because if the Black community has to endure another year like his first, the lesson he will leave us with is that having a Black president may be good for the soul, but it’s the effect on the pocketbook and the dinner table that will be the ultimate judge. May you have a merry Christmas and a happy Kwanzaa.
A GREAT TIME FOR ALL AT OLDTIMERS ANNUAL FUNDRAISER
More than 250 supporters and devotees of the Brooklyn Oldtimers Foundation, Inc. gathered Sunday, December 13 afternoon at Antun’s in Queens Village to applaud the group’s exceptional record of stellar service to New York City during its 37 years of existence.
The classy annual affair recognizes young people, business owners, educators, professionals and association members who have made outstanding contributions to the communities they serve, said Mr. Reuben C. Bankhead, BOF President.
Over the past 37 years, the BOF, through these annual fundraising events, has awarded 124 scholarships totaling nearly $350,000. “In each of these years, the BOF with the help of its friends, has granted financial assistance to more than 200 Central Brooklyn High School graduates,” he said. “We have also acknowledged and celebrated the work of a pantheon of prominent community leaders by listing them on our distinguished Honoree Scroll. “It’s the chance to recognize our own.”
The scholarship awards were presented to Naytira S. Baker, from George Wingate H.S. and on her way to Daemon College; Keith G. Salhab, graduate of Boys & Girls H.S., who is now at Howard University; Paul Robeson High School alumnus Avion Alexander of NYC College of Technology and Robert Garcia, who attended Thomas Jefferson, and now is excelling at NYC College of Technology. Each student received $1,000 per year for a period of four years.
The Foundation’s in-kind work with the students, including nurturing them, positioning them, counseling and being a phone-call away if there are any problems can easily bring the total scholarship gift over the past 37 years to $1 million dollars.
This year, the Foundation honored Jennifer P. Small, one of its former scholarship recipients, now a Client Service Representative with Citi’s Prime Finance Division, by listing her with the Honoree Roll Class of 2009. That list also included Doris D. Bell, Director of the Frank R. Bell Funeral Home; Dyrnest K. Sinckler, Executive Vice President and Chief operating Officer of Bedford Stuyvesant Restoration Corporation (BSRC); Bernice E. Green and David M. Greaves, publishers of Our Time Press; and architect T. Barrett Stanley, BOF Board Member and Founder/President of Stanley Architects/Planners of Brooklyn, NY.
Our Time Press publishers were very proud of their induction with fellow and sister community servants into the Oldtimers’ Honoree Roll and to be in the company of previous inductees Sydney S. Moshette, Jr., MSW, an Oldtimers’ Board member; Samuel Pinn, chairman, Fort Greene Council, Inc. and award-winning athlete Mary DeSaussure Sobers, who were present at the December 13 event.
Others in the tony crowd included: community activists Doris Pinn andEdna Moshette; The Rev. Johnny Youngblood, pastor, Mt. Pisgah Baptist Church and pastor emeritus of St. Paul’s Community Baptist Church; Writer Matrice Brooks; Colvin Grannum, President and CEO, Bedford Stuyvesant Restoration Corp.; Councilman Al and Mildred Vann; socialite Barbara Sidbury; Bernard Gassaway, principal of Boys & Girls H.S.; Father Garver Israel of St. Philips Episcopal Church; and so many more.
Brooklyn Borough President, an unfailing presence at the Oldtimers’ annual events, was sidelined by a minor traffic accident that rainy day, but his fond wishes made it to the event and were well-received.
Highlighting “the afternoon of nostalgia and remembrance” was a rousing “Circle of Brothers” ceremonial march; and call and shout by the Oldtimers Foundation. Board and associate members.
Board Member deftly handled the Lawrence Boatwright master of ceremonies duties at this lively, classy event, which featured the lively music and rhythms of The Ron Anderson Band.
This year’s event was organized and elegantly hosted by BOF’s Board of Directors, including Mr. Bankhead, James N. Tempro, Alfred S. Welch, Mr. Stanley, James Dupree, Mr. Moshette, Roger P. Montgomery, G. Nesbitt Benjamin, Charles P. Coombs, Edwin S. Douglas, Jr., Charles A. Foster, Elisha R. Gill, Thomas R. Leach, Darnley Osborne, Mr. Boatwright and John Johnson. Bernice Elizabeth Green
Black-Owned Businesses Shortchanged on SBA Loans, Non Existent on Stimulus Fund List
SBA Shuts Out Black, Hispanic Businesses From Stimulus Loans
By Aaron Glantz
New America Media (www.newamericamedia.org)
(December 17, 2009) Loans handed out to struggling small businesses as part of President Barack Obama’s stimulus package have largely shut out minority businesses – especially those owned by Blacks and Latinos – according to data provided by the federal government’s Small Business Administration (SBA) to New America Media.
On June 15, the SBA, using money from the $787 billion American Recovery and Reinvestment Act, launched the ARC program, America’s Recovery Capital, giving banks and credit unions 100 percent guarantees so they’re taking no risk when they make loans of up to $35,000 to previously successful, currently struggling small businesses to help them ride out the recession.
Under the program, the borrower pays no interest and makes no payments for 12 months, then has five years to repay the loan. SBA charges no fees and pays interest to the lender at prime – the rate of interest at which banks lend to favored customers – plus 2 percent.
The Obama Administration does not report the racial breakdown of who’s benefiting from these loans at Recovery.gov, but data obtained by NAM from the SBA found that of the 4,497 ARC loans where the race of the borrower was reported, 4,104 (over 91 percent) went to white-owned firms, 140, (3 percent) went to Hispanic-owned businesses, and 151 (3 percent) went to Asian- or Pacific Islander-owned businesses. Only 65, (1.5 percent) went to black-owned firms.
Overall, white-owned businesses received over $130 million in loans through the program, while Hispanic-owned businesses got $4 million and black-owned businesses less than $2 million.
In five states – Alabama, Arkansas, New Hampshire, South Dakota, and Wyoming – every single firm that received an ARC loan was white-owned. In eight other states, including Louisiana and Nevada, all but one loan went to a white-owned firm.
Civil rights groups and representatives of the minority business communities reacted with anger when told of NAM’s findings.
“It’s just horrendous,” said Anthony Robinson, director of the Washington, D.C.-based Minority Business Legal Defense and Education Fund (MBELDEF). “During this economic recession, there is no recognition or sensitivity to the need to support and benefit people of color.”
“The data raises troubling questions” and should trigger an investigation,” says Oren Sellstrom of San Francisco’s Lawyers Committee for Civil Rights. “This should be a red flag for the SBA and the banks. It gives us the indication that something may be amiss and further explanation is warranted.”
Census figures put black business ownership at 5 percent and Hispanic business ownership at about 7 percent – more than double the numbers getting these SBA-backed loans.
At the SBA in Washington, spokesman Jonathan Swain argued racial disparities in the ARC loan program don’t paint the full picture of the agency’s lending practices. Many of the SBA’s other loan products, he says, have large minority business participation. For example, he says, minority-owned businesses receive 29 percent of loans given through the SBA’s regular lending program and 37 percent of Microloans doled out by the agency.
“It’s hard to look at the ARC program by itself,” he told NAM. “It’s just one tool in the tool box, just one tool in the array to help small business in these tough economic times.”
One reason for the extremely low level of minority participation in the ARC loan program, he maintains, is that the Recovery Act specifically prohibits the agency from allowing an ARC loan to be used to refinance a regular SBA loan, which minority firms are more likely to have.
That explanation isn’t enough for minority business and civil rights groups, however.
Sellstrom of the Lawyers Committee for Civil Rights isn’t convinced by that argument. “You would think that minority owned firms could use $35,000 for a lot of uses other than paying down SBA loans.”
Sellstom said SBA’s response only underscores the need for further investigation. “It’s often the case that the first explanation leads to further questions,” he said.
Javier Palomarez, the president and chief executive officer of the United States Hispanic Chamber of Commerce, says the ARC loan program was poorly designed and “destined to fail.”
When Congress was drafting the stimulus package, Palomarez said, his agency and other minority business groups argued the severity of America’s recession should have led to the government handing out loans to struggling small businesses directly – rather than simply backing up loans from the very banks that caused the country’s economic recession.
But the SBA and the banks lobbied against direct government financing of small business, he said, and so Congress devised a $35,000 loan program that requires a small business to wade through nearly the same paperwork needed to obtain one of SBA’s regular $2 million loans.
Because of the paperwork and the small sums involved, “most banks don’t want to participate in the loan program, and many of those that are participating are restricting applications only to long-term clients.”
And those long-term clients often exclude small, minority businesses, which banks see as “risky.”
“There’s been a dramatic rise in the risk profile of small businesses,” Palomarez said “and that is even more pronounced among minority entrepreneurs.
“African American and Hispanic entrepreneurs often self-financed their start-ups or expansions, meaning, that they tapped into their own net worth … taking out home equity loans or second mortgages to invest in their communities and create jobs.”
“These businesses did not get a bailout and, while the Administration has been generous with tax credits for struggling businesses, the banks that caused this problem are nowhere to be seen,” he said.
James Ballentine, senior vice president of the American Bankers Association, told New America Media the banks have nothing to do with the racial disparities apparent in the stimulus’ small business loans.
“When somebody comes to us, we don’t look at their race,” he said. “The can be red, white, brown, or green. The only thing we look at is their credit worthiness.”
The main problem, Balletine, said, is “there’s been a real lack of marketing and as a result, very few lenders have participated.” He noted that in the six months since the ARC Loan program was first announced, the SBA has been able to underwrite fewer than 5,000 loans.
But Sellstrom of the Lawyers Committee says the bankers’ analysis doesn’t address the question of the racial inequities. The fact that there’s been little marketing doesn’t mean that nobody is being told about the opportunities. It just means that it’s going on in less formal ways, and those informal channels are the ones that minority businesses are not privy to.”
“The breakdown is that people of color are not present at the banks,” added Anthony Robinson of MBELDEF.” And the government that’s pushing these benefits through are not sensitive to the fact that we are not involved in this distribution network.
“So to solve this problem we need to incorporate people of color into the distribution chain of banks, business, and government. Otherwise, the flaws of the system will only magnify the inequality that’s at the center of our recession.”
Black Construction Companies Shorted on Stimulus Contracts
By Aaron Glantz
New America Media (www.newamericamedia.org)
Since President Barack Obama signed his stimulus package into law in February, the U.S. Department of Transportation has handed out more than $150 million in contracts to companies for street, highway and bridge construction.
New statistics released this week by the Transportation Equity Network (TEN) show that from that pot of money not a single dollar had been allocated to any African-American owned business.
“Stunning,” is how TEN’s media director Stephen Boykewich described his organizations’ findings.
“What we’re seeing all over the country is that in spite of stated language in the stimulus bill that this was supposed to go to disadvantaged communities hit hardest by the recession, those communities are having incredible difficulty gaining access to those funds.”
TEN, a 22-state network of more than 300 community organizations fighting for an equity-based national transportation system, crunched numbers publicly available on-line at the Web site of the government’s federal Procurement Data System (www.fpds.gov) in making their findings.
The federal Department of Transportation had so far given out $163.8 million in direct contracts, they found and of that only $16.8 million, or about 10 percent, had gone to all minority-owned businesses; $4.7 million, or about 3 percent, had gone Hispanic-owned businesses. Not a single black-owned firm had received a contract from the DOT.
In Washington, a DOT spokesman refused to comment for attribution for this story and wasn’t able to offer an explanation of the statistics assembled by the Transportation Equity Network.
He added that the DOT’s Disadvantaged Business Enterprise (DBE) program doubled in size over the last year. and he forwarded a press release stating the agency “has participated in many national events” and organized “workshops, presentations, and DBE Days” to increase the amount of minority contracting.
Transportation Secretary Roy LaHood also sent a letter to every governor in the country December 7 urging them to “take advantage of existing equal opportunity programs and resources and to create innovative strategies to provide opportunities for the under-represented” with transportation infrastructure dollars they administer under the $787 billion American Recovery and Reinvestment Act.
Richard Copeland, the African-American owner of Thorn Construction in Minneapolis, says those efforts haven’t been successful because LaHood is only offering suggestions and not enforcement.
“You’ve got to put teeth in it and be willing to withhold the stimulus money if it’s not being enforced,” he said. “Unless you mandate and enforce it, it’s not going to work.
“It’s asking for voluntary participation and voluntary cooperation, and power is not conceded using those types of methods,” he said. “You’ve got to mandate that money goes into communities of color and then follow up.”
Copeland, who is the immediate past president of the Minority Contractors Association in Washington, DC, said the small number of minority firms receiving stimulus contracts is a partial cause of the Depression-like unemployment levels that now plague the African-American and Latino communities.
In November, the Labor Department reported the seasonally adjusted unemployment rate of 15.6 percent for blacks and 12.7 for Hispanics. It is 9.3 percent for whites.
“We know that 60 percent of the employees of minority firms are people of color,” Copeland said, “so if none of us get contracts, people in our communities won’t get jobs.”
The Transportation Equity Network believes the best way to solve this problem is to create a 30 percent set-aside of work hours for disadvantaged workers as part of any new jobs bill that passes the House in the coming month, as well as stronger accountability and transparency in tracking the use of all federal funds for economic stimulus and job creation.
In the meantime, the Boykewich, pointed to Missouri as a state where significant progress is being made.
Missouri’s Department of Transportation recently agreed that low-income construction apprentices would make up 30 percent of the work force on a $500 million highway project that was just completed. Working with trade unions and community groups, the department also agreed to use $2.5 million of the project’s federal funding to train low-income residents in construction work.
“And the best part was the project came in on time and under budget,” Boykewich said.
Boykewich said he’s cautiously optimistic after seeing LaHood’s letter’s to the governors. The Obama administration is moving in the right direction, he said, even if communities of color have yet to see any results.
Aaron Glantz is NAM’s Stimulus Editor
Charles Barron’s Challenge: Time For People of Color to Take Power in City Council
We’ve learned the reasons for the competition for the City Council Speaker’s chair, currently held by Christine Quinn, from our November 19th interview (see sidebar) but they say in politics, the first thing you have to learn is how to count. We asked Councilman Barron how many votes he needs and how many does he have. “We need 27 votes and If the masses voted I’d win hands down. Unfortunately, it’s the City Council that votes and right now they all seem to be sticking with Christine Quinn.”
Councilman Barron remains undeterred by the lack of Council member support and is forging ahead. “The movement is spreading across the city. Reverend Sharpton has called a meeting of clergy and Council members of the Black, Latino and Asian Caucus for Saturday, and we’re going to have another meeting on Saturday the 19th at 2:00pm at the House of the Lord Church, 415 Atlantic Avenue, to report the progress and the building momentum.”
Barron says his campaign has already borne fruit having caused Speaker Quinn to defy the mayor for the first time and an Armory development project in the Bronx. “For the first time in Council history, the mayor’s choice was voted down.” And there is another milestone that was marked because of his campaign. “First time in the history of the City Council, something I’ve been talking about, a Black will become chair of one of the two powerful committees of the City Council, Land Use and Finance. We’ve never had a chair of that. Leroy Comrie from Queens may get that post. I credit that to our movement.”
Barron says he is running because no one else has stepped forward to challenge Quinn, which he finds inexplicable and would cause Adam Clayton Powell to “spin in his grave.”
“Adam Clayton Powell was the first Black elected as a City Council member in 1941, and in 1944 he went to Congress. In 1943, Glenn Davis, a Black Communist from Harlem, was elected to the City Council. If they can do that when they were the only ones there, what can we do now that there are 27 of us? Adam Powell said to use what’s in your hand. All we have to do is vote for one of us and we break the racist white monopoly on the Council Speaker’s race.”
To Barron, the inability to take this step and take leadership of the most powerful position in the City Council in the most powerful city in the world, may have to do with the effects of Post-Traumatic Slave Syndrome that Joy DeGruy Leary has written about. “As Harriet Tubman said, ‘I could have freed more if they only knew they were slaves.’ And Carter G. Woodson said, ‘If there’s no back door, we’ll make one.’”
Offering an example of a way to proceed, Barron says, “We can lock ourselves in a room over the weekend and come up with someone and say this is who it’s going to be. It could be Al Vann, Robert Jackson, Tish James, I don’t care who it is. But one of us has to say this is our agenda and this is our strategy and let’s make it happen. We have to do this for the people of the city. We have to stop the mayor from balancing the budget on the backs of the poor.”
Barron says “It’s not over until the fat lady sings, and I haven’t heard her yet.” His feeling is that until the vote actually happens, there is still the opportunity for leaders on the Council to vote “for themselves and their people and not continue the discrimination in allocation of monies to our communities and the land-grab by the rich.”
He calls on voters to contact their Council representative and ask “If not Charles, who, and if not now, when”?
David Mark Greaves