Lappin Begins 2009 Campaign Locally with a Picnic

With no discernable Democratic or Republican challengers making themselves known on Roosevelt Island, City Council Member Jessica Lappin is hosting a BBQ picnic this coming Thursday, August 14th at Lighthouse Park from 6:00 to 7:30 pm.

The suggested donation to the event and to Ms. Lappin’s campaign is $15 and checks should be made payable to “Lappin for Council”.

Ms, Lappin represents District 5 on the City Council which includes Roosevelt Island.

Could the City Reclaim or Threaten to Reclaim Roosevelt Island to Force the ESDC to Withdraw FMV Tax Bills?

This afternoon it was announced that New York City has reclaimed South Brother Island and that it will probably be left untouched as a sanctuary for birds and other wildlife that live there. Could New York City reclaim its title to another island in the East River and remove the fears of its residents that Empire State Developement Corporation FMV tax equivalency bills will destroy their homes?

With the issuance of full value bills for tax equivalency payments issued to three of Roosevelt Island’s four Mitchell-Lama properties could New York City reclaim Roosevelt Island citing the destruction of affordable housing as a reason to break its lease of the Island to New York State?

Certainly there are too many other factors involved which would prevent this from happening including the transition of services currently provided by RIOC to the equivalent City agencies.

But if the Island was no longer under State control than perhaps the 2005 City Council Resolution (#388) extending Mitchell-Lama tax benefits 50 years would apply as then the buildings would owe actual taxes and not “payments in lieu of taxes” which seems to be part of the current controversy whether the state intended to give the City Council the ability to affect taxes other than payments intended to go to City coffers.

Eventually when the current State-City lease runs out the fact is the Island will revert to City control and by that time it is expected each Mitchell-Lama property will have successfully exited the program. In the mean time can the City put a little pressure on Albany and remind them that the landlord does not like it when its tenant, NYS, is scarring its subtenants. Can NYC as landlord remind NYS that ultimately it holds jurisdiction over the Island and that to impose the FMV ESDC tax bills in some form violates that jurisdiction when their issuance is contrary to the well being of those residents?

WIRE: 2005 City Council Resolution Extending Exemption DOES NOT Apply to Roosevelt Island Mitchell-Lama Buildings

A review of back issues of the Main Street Wire from 2005 yielded the following articles and texts. Ultimatelty it appears that the WIRE concluded that the City Council resolution extending the tax exemptions did not apply to Roosevelt Island.

If this is true the issuance this week of the tax equivalency bills by the Empire State Development Corporation to Westview, Island House and Rivercross could prove disastrous for the residents who expected that the 50 year additional exemption applied to their buildings.

What I don't understand is why then if the WIRE reported the conclusions reached by the State and City officials back in 2005 was the issuance of the bill to Rivercross something so unexpected as indicated in the flyer posted in Rivercross and distributed to their residents.

As reported in the Main Street Wire on February 19, 2004:

“At press time, attorneys for the City's Department of Housing Preservation and Development (HPD) and the State's Division of Housing and Community Renewal (DHCR) had still reached no conclusion about exactly what the action could mean on Roosevelt Island, which is unique in the State's constellation of Mitchell-Lama developments because the Island,while owned by the City, is leased to the State for development (to 2068),and the PILOT payments - which substitute for "real" taxes - go to the State, not the City. A key question: Did the State Legislature, in amending the PHFL, intend to give the City Council the authority to forgive payments in lieu of taxes (PILOTs) to the State? That issue was raised when a WIRE question was relayed by Lappin to HPD and DHCR. Lappin said HPD and DHCR would have to be consulted. On Thursday, however, a DHCR spokesman said, "That's really a question for the City Council."

While the Island's PILOT payments would normally be passed through to the City, they are not. That's because the Urban Development Corporation (UDC) has substantial "credits" with the City by virtue of its original development of the Island. The PILOT income stops in the State's coffers.”

After several issues of the Main Street Wire offering nothing substantive other than resident commentaries, Dick Lutz in the May 14, 2005 Main Street Wire states that the Resolution has no applicability to the Roosevelt Island Mitchell-Lama buildings:

"It may be a technicality of sorts, but Roosevelt Island buildings will not get the 50-year extension of tax abatements the State Legislature authorized the New York City Council to grant to Mitchell-Lama apartment buildings.

"The [Legislature's] bill itself refers to taxes," said Jessica Lappin, an aide to Council Speaker Gifford Miller, "and the buildings on Roosevelt Island don't technically pay taxes. They look and smell and feel like taxes, but they're not technically taxes."

When the City Council granted the tax-abatement extensions earlier this year, materials accompanying the Council resolution specifically listed Westview, Island House, Rivercross, and Eastwood. It held out the possibility of a Mitchell-Lama future with tax costs remaining low. But that was a mistake.

What "look and smell and feel like taxes" for Roosevelt Island are PILOTs - "payments in lieu of taxes" - made to the State. For those who pay them, they are the functional equivalent of taxes, and for the Island's Mitchell-Lama buildings, they are scheduled to rise significantly over the next couple of years - a provision of the ground leases under which the buildings were placed on land owned by the City, but leased from the City by the State.

The WIRE raised questions about the Island's eligibility for the abatement extensions in February in a report on the City Council's action, and again in April in a commentary written by Tim Johns, an Island House resident who has kept close tabs on the laws, leases, and regulations that apply to the Island's Mitchell-Lama buildings. As a result, State and City lawyers looked into the matter and realized that earlier statements affirming applicability to the Roosevelt Island buildings were incorrect."