EDC projects started after 2005. All data from NYC EDC. * Denotes companies of 500 employees or more.
Mayoral candidate Bill de Blasio’s lofty goal of leveling inequality suggests big changes at the Economic Development Corporation. But his broad policies won’t bring sweeping transformation — the EDC is spreading out its resources without him.
De Blasio’s strategy for economic growth is to focus City investments on small-scale localized projects, and away from big corporations. He criticizes the Bloomberg Administration for allowing companies that don’t need the help to benefit from public subsidies. The EDC is where this disparity would be addressed. It has a unique ability to influence the changing face of the City by making decisions about which neighborhoods are invested in and how.
“The City’s economic development resources have failed to reach most neighborhoods,” says his policy book, Jobs for All New Yorkers.
But observers say the EDC is already diversifying its investments.
In a 2011 report, which de Blasio requested as Public Advocate, the Independent Budget Office said the EDC had been diversifying its projects for the last few years under the Bloomberg Administration. The financial and information sectors, which are primarily based in Manhattan, received more assistance from the EDC than all other industries from 1992 to 2005 — 59.5 percent of the value for all new projects. Since 2005, the EDC has made a concerted effort to impact a larger variety of industries and neighborhoods, with most new projects in the years prior to the report located in the outer boroughs.
According to data available on EDC’s website, 71 percent of all projects initiated before 2005 were in Manhattan. That number has fallen to 23 percent, with the Bronx now receiving the highest portion of City assistance.
“They’re already doing it,” said Robert Altman, a real estate lawyer and lobbyist. De Blasio’s complaints are directed at a few large commercial projects, but most of EDC’s investment already goes towards small companies. “Is 20 employees a big corporation? Is 50?” asked Altman.
The EDC data shows that companies with 500 or more employees went from receiving 78 percent of the subsidies to 54 percent.
This already apparent trend means de Blasio’s message alone won’t change the way EDC operates very much. And this may be helping now that he has to walk a fine line as a populist who also appeals to the business community. He manages to keep from alienating developers by not proposing substantive changes to EDC’s policies, only vague rhetoric.
“He’s not taking an anti-development stance,” said Hank Sheinkopf, a political consultant active in New York City politics. “He’s trying to position himself as all things to all people.” For their part, the business community has little choice but to stay as close as they can to the frontrunner.
If de Blasio really want to make an impact, he’ll have to offer more than just general directives to the EDC. He’ll need to choose the right leadership.
A president and 26 board members make the decisions at EDC. The Mayor appoints them all with some recommendations from the borough presidents and City Council. In practice, the organization acts as an extension of the Mayor’s Office.
“The reality is that the Mayor has tremendous if not complete control over the EDC,” said Bettina Damiani, project director of the subsidy watchdog, Good Jobs New York.
Advocates say the current EDC board is disconnected from the needs of the working and lower classes. Most of its members, including the current president, Kyle Kimball, have backgrounds in the business and finance worlds. Only three of the current members have experience with neighborhood advocacy or grassroots efforts. Seven members also work for City agencies.
“There’s no one on that board who understands the needs of low-income people,” Damiani said.
De Blasio supporters are holding out hope that he’ll address the board’s make up, and lend a voice to the communities that will feel the effects of the EDC’s efforts most directly. Reverend Patrick Young, Pastor of First Baptist Church in Corona, Queens recently co-wrote an op-ed for the Daily News about how the Willets Point project will increase inequality in his community. Though de Blasio supported that project, Young believes he would do a better job with the EDC if he were elected Mayor.
“He’s going to make every effort to do what’s right and to level the playing field,” Young said in an interview.
“The current board is very much one sided. It shouldn’t be just one group getting a bite of the apple.”