Rising interest rates help CitiSquare overcome hurdle
Imminent interest rate hike that threatened Newark’s $2 billion Bear Stadium redevelopment to place prompted the city council to fast-track an $18 million grant for the developer without a written guarantee to pay a going wage or a labor harmony pact covering the construction and operation of the complex.
But City Council President LaMonica McIver sternly warned the developer’s lawyer that the council could revisit the deal if it didn’t act quickly on outstanding labor issues and engage company promises to unions on paper.
“We’re 150% for labor here – Council is and I know the mayor is,” McIver told Lakewood-based Accurate Builder & Developers attorney Calvin Souder. . “We want this resolved by the end of the week.” McIver also suggested to his Council colleagues, who goes ahead, the city to find a kind of master union agreement that “would apply to any development of a certain magnitude because it is the right thing to do”.
“We are committed to working with the unions and making sure we at least pay fair wages at this particular site,” Souder told the council. The promoter’s lawyer conceded that “good faith” negotiations were underway with 32BJ SEIU and with Local 3 of the International Union of North American Workers, but nothing was committed on paper yet .
IN TOWN IN A TOWN
Accurate builders and developers already has been granted permission to develop a mini-town on the 11-acre property located west of McCarter Highway and within walking distance of New Jersey Transit’s Broad Street train station. Previously, the site was home to Newark Bears & Eagles Riverfront Stadium which closed in 2013 and was demolished in 2019. Plans call for the complex to include 11 buildings that will house 4,200 apartments as well as 100,000 square feet of retail, office and of reception. as well as 3,000 parking spaces.
The ambitious plan, marketed as CitiSquare, is to be completed over the next 15 years in nine phases. The initial round envisions a pair of 18-story residential towers with nearly 600 apartments linked together by a common floor that will include a restaurant and retail space. The developer has pledged to provide more than 400 affordable, 10% reserved homes, which were criticized by some of the activists at the hearing for being inadequate for a city in the throes of a severe housing crisis.
Council members and a steady stream of speakers during the public comment portion of the hearing also lamented the proponent’s last-minute effort to offer only a verbal commitment and a one-sentence email. to city officials to resolve outstanding labor issues.
“I’m not up for a pony ride,” Council Member Louis Quintana said. “I want it in writing before I vote and that’s important. I have an obligation to the riding of this town, not to the developer, to be a gatekeeper…I would suggest we postpone this in good faith until next week.
April Fitch is a security guard at Liberty International Airport and a member of 32 BJ SEIU, which represents 175,000 real estate service workers from Boston to Miami, including 13,000 in New Jersey.
FAMILY SUPPORT SALARY
“I was also born and raised in Newark and I’ve been through many cycles that this city, my city, has gone through,” Fitch told the packed house. “With respect to its own construction services contracts, the City of Newark has recognized the importance of paying family wages that are on par with private commercial construction services workers in downtown Newark. That’s why we have a wage law in place for building service workers. »
Fitch continued. “However, these protections do not apply to development projects, even those that receive an abatement, such as the Bears Stadium project, also known as CitySquare, where the developers have not made commitments to construction service workers who will eventually staff development.”
Fitch urged City Council to vote no on “the $18 million tax abatement for this project until the developers commit – in writing – to do the right thing, pay fair wages , to provide accessible quality health care and paid leave”.
32 BJ SEIU has 3,500 building services contract employees who work as janitors, security guards, porters, janitors and building superintendents in Newark. 2,500 union members also live in Newark.
“We can and must do more to ensure that working families benefit from multi-billion dollar projects,” said Carla Thomas, 32 BJ Deputy District Manager. “32 BJ supports responsible development and welcomes investors to Newark. But we must ensure that development benefits working families through the creation of family-supporting jobs. Without a clear commitment to good jobs for the workers who maintain this luxury development, they will be left behind. »
Thomas added that future construction services workers on the city-subsidized project should be entitled to affordable medical coverage. “Nationally, only 36% of workers in the lowest wage quadrant are offered [health] insurance and only 21 percent of these low-wage workers participate in their employer’s plan,” she said.
“Obviously there’s a lot of tension around a project of this magnitude and rightly so,” said Paul Roldan, president of Local 3 of the Workers’ International Union of North America. “There are a lot of complexities as evidenced today in the early stages of a project and of course a lot of that includes the community and the lack of effort to include the community is what seems to be an issue, including members of the community who are part of the Newark City Labor Union and Organized Labor.
DIGNITY IN AN AGREEMENT
“If it’s not written, it’s not done,” warned community activist Debra Salters, a Newark resident and building trades professional. “We know that in life we are taught that. So, yes, we need this in writing…. I could tell you one thing right now and when the paper arrives it’s different…. It can’t be a last minute conversation in the hallway or a last minute email before I enter the Council Chamber. »
Salters, who worked on the construction of the American Dream project, said she was concerned the developer’s commitment to pay a going wage was limited to so-called permanent workers. “We need to see this in writing,” she said. “Does the worker who works today have a job tomorrow? That’s why we need to see these things in black and white – concretely – that’s what was said.
Quintana’s motion to defer authorization of the $18 million project grant garnered only one additional vote from council member Dupre L. Kelly, who was recently elected in the West Ward.
“I like that the going wages are agreed and the working harmony agreement, but I would like to see the working harmony agreement,” Kelly said. “I am for the community and I am pro-union. I want to see all of this. I want to see us make the right decision for people and include them in this process.
Accurate Builder’s lawyer warned the Council that his client had locked in an interest rate that was due to expire on August 1 and that the “cost of the loans would double”, derailing the project if the Council did not vote to go from the front.
It was North Ward Council member Anibal Ramos Jr. who suggested the panel go ahead with the project, but ‘revisit’ the $18 million grant ‘if we don’t have the [labor] agreement within a reasonable time.
Joe Wilson is a labor historian and trade union strategy consultant. He says it’s vital for 32 BJs and the construction unions to ‘negotiate together and be in touch with the city council and have everything codified in writing and clad in iron so that the workers benefit and the community don’t get ripped off with only a paltry 400 affordable units out of a development of over 4,000 units.
“We’re seeing support that we really appreciate from the mayor and city council pushing the developer to do the right thing that encourages us,” said Kevin Brown, Vice Chairman of the New Jersey Council of 32 BJ SEIU in an interview ahead of the July 26 hearing. “But the main thing is that they get that money without commitment for good jobs and benefits.”
In public comments, Munirah El Bomani, a Newark housing activist, told the Council that the city’s inclusive zoning and affordable housing strategy were seriously inadequate.
“Rents are too high and inclusive zoning isn’t working for all Newarkans,” she said. “You have to get everyone on board. We need you to nominate land that should be converted into public housing. We need you to give to foreigners, to the rich who come here and 20% [of the units] and give 80 percent of them back to the community.
In February 2021, the Rutgers Center on Law, Inequality and Metropolitan Equity (CLIMATE) issued a report which documented that Newark needed to add 16,000 affordable housing units. The analysis doesn’t to understand the last economy statistic that captured the fallout from the pandemic, such as the rise seizures, roaming and evictions.
According to CLIME, 59% of all tenants in Newark were rent-constrained, paying more than a third of their income for rent while a third paid more than half their income for housing. 40,000 Newark households earn less than $30,000 a year and compete for less than 20,000 low-income housing units.