BPC Renters and Owners to Share $15.6 Million Relief Package
As Rent Striking Condo Owners Get Deadline for Paying Up

By Ronald Drenger

The Battery Park City Authority announced a $15.6 million disaster relief package for BPC residents, including renters and owners, whose lives were severely disrupted by the World Trade Center disaster.

At the same time, the Authority notified 2,191 rent-striking condominium owners that it intends to go after the approximately $13 million in ground rents and payments in lieu of taxes (PILOT) that the owners have withheld since Sept. 11. The owners in 10 of Battery Park City’s 11 condominiums have demanded reductions in their payments because of the decrease in the value of their homes.

Battery Park City’s approximately 6,600 residents (down from about 9,000 before Sept. 11) will receive relief checks averaging $1,840 for rental units and $2,850—about three months’ worth of payments, according to the Authority—for condominiums. About two-thirds of Battery Park City’s housing units are rentals.

BPCA president Tim Carey said that the city’s new comptroller, William Thompson, as well as Mayor Bloomberg and Governor Pataki, supported the offer to residents.

"They agreed that this relief will be helpful for the economic revitalization of Battery Park City," Carey said.
The checks, which are expected to go out in June, will be given not only to current resident but also to those who move in by July 1. Tenants who move out before June will not receive the benefit.

"We’re hoping this stimulus will assist people in moving back into Battery Park City," Carey said. "Rental properties are in need of relief, and we hope this will help fill up some of those empty apartments."

The money will be taken from the Authority’s reserve fund, made up of excess revenues that the agency collects and gives to the city.

Sudhir Jain, who heads the Lower Manhattan Tenants Coalition, comprised of tenant groups from a dozen rental buildings, including six in Battery Park City, called the offer "a step in the right direction."

"It helps, but it’s not earth-shattering or a complete solution by any means," said Jain.

Downtown tenant groups have been pressing their landlords for more comprehensive environmental testing and cleanups inside buildings, and for rent abatements and the right to break leases. At least five tenant associations, including three in Battery Park City, remain on rent strikes begun in October and November. Another five, including the tenant associations of Gateway Plaza and 22 and 41 River Terrace, have either reached settlements or are close to agreements with their landlords.

The striking condo owners’ conflict is more directly with the Battery Park City Authority and the Authority is sending out 45-day notices that will pave the way for it and the city to pursue legal options to recoup the $13 million that has been withheld.

"We’ve tried to negotiate with the condo owners and we will try to continue to negotiate," the Authority’s Carey said. "We reached a point that we had to exercise our right according to our leasehold agreement. We felt that to go any longer could call into question our concern" about the money.

Carey said that the city, and not the Authority, controls the levels of PILOT payments. As for the ground rent, he said: "We can talk about that, but ground rent from those buildings is pledged to our bondholders."

He acknowledged that some condo owners are not happy with the Authority’s relief offer, but said the package "is targeted toward everyone. It’s a fair package, and it’s what we could afford." He said he was "very optimistic" that the two sides will reach an agreement within the 45 days.

Eugene Glazer, chairman of the Battery Park City Homeowners Coalition, said the relief offer, combined with the threat of legal action, was "a little carrot and a big stick."

"The amount of money involved is very small compared to what most people would perceive to be very substantial damage to the community," he said. "I strongly disagree with the statement that this is all they can afford. We believe the fund from which this money is coming is actually $46 million, and the Authority, along with city, have the flexibility to determine how the funds are used."

Many homeowners have substantial portions of their savings invested in their homes and don’t have the flexibility to leave if they want to, as renters do, Glazer said. Many renters have received significant rent reductions, he said, and for condo owners, "the total carrying cost for an apartment, mortgage plus common charges, is in many cases higher than market rental rates."

The Homeowners Coalition in October proposed that monthly payments of ground rent and PILOT be waived for up to four years, with periodic reviews of the economic climate downtown.

"How long are conditions that are depressing this community going to last? If in a year or two years the conditions are back to what they were, and are reflected in property values, then there would be no need for further remedy," Glazer said. He said the owners in October had requested a meeting with the Authority, but that the Authority met with them for the first time only in January.

Glazer, who owns an apartment in the Regatta, 21 South End Ave., said that condo owners are "digging in" in response to the Authority’s action, but that the coalition wants to sit down and negotiate.

"We’ll keep fighting and go to court if necessary," he said. "But it’s in everybody’s interest to not let the 45 days expire."