The Enigma of Prospect Heights

When someone writes the tome on how expansive government is genetically inefficient, there ought to be a chapter on the failed record of intra-bureaucracy communication.

A case in point comes courtesy of New York, where, one might recall, many Brooklyn residents were recently served with condemnation notices courtesy of the Empire State Development Corp. In part, the notice of their properties' impending implosions read:

The Atlantic Yards site is located in the intersection of three major arterials: Atlantic Avenue, Flatbush Avenue, and 4th Avenue. Despite its location on these major arterials and the presence of ten subway lines and the LIRR Atlantic Terminal across the street and two other subway lines and 11 bus routes in the vicinity, the Atlantic Yards project site has been a center of blight and decay.

For the state to qualify for a legitimate eminent-domain taking under New York's constitution, the affected property owner has to be in the way of a public-works project (new highway) or a blighted area the state proposes to revitalize, and be justly compensated. Hence, ESDC's farcical claim that Prospect Heights is a "center of blight and decay."

Meanwhile, City Council Speaker Christine Quinn is proposing a reworking of somewhat controversial 421(a), a tax-abatement program created in the 1970s to spur residential development. Developers receive significant chunks off their property-tax liabilities in exchange for introducing new residential units to the housing market. For areas that are already affluent, a "geographic exclusion area" was created to ensure these tax benefits don't unduly benefit wealthy landowners. The GEA, as 421(a) currently exists, includes Manhattan from 14th Street to 96th Street and the Greenpoint-Williamsburg waterfront in Brooklyn.

The program being three decades old, posh neighborhoods now exist in many areas outside the GEA. Consequently, many news stories have described how 421(a) allows people like Natalie Portman, Calvin Klein, and Derek Jeter to save gobs on their property-tax liabilities. While 421(a) is scheduled to sunset at the end of 2007, Mayor Bloomberg has proposed reworking it as a vehicle to generate "affordable housing." Several members of the City Council have pitched their own reform, essentially seeing Bloomberg's "affordable housing" requirement and doubling it. Quinn is currently working to reconcile the differences.

A map of Quinn's proposed Geographic Exclusion Area (green line):
So the area where Forest City Ratner intends to build the Atlantic Yards project is now too developed for tax benefits? (h/t: The Observer's real estate blog.)

Perhaps the city's Economic Development Corp. will reconcile everything with a new motto: "Prospect Heights: a neighborhood of contrasts -- at once both too affluent and too blighted for frivolities like tax benefits and private-property rights." Though how that would attract anyone I'm not sure.