City Limits Magazine, December 1981 Issue

8/3/2019 City Limits Magazine, December 1981 Issue

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THE NEWS MAGAZINE OF NEW YORK CITY HOUSING AND NEIGHBORHOODS

Tales of Crown Heights:

DECEMBER 1981$1.5

The Fruits of HarassmentA cycle of harassment and displacement, followed bysubsidized renovation in a 'number of Crown Heightsbuildings has been conf'mned by at least one city hearingofficer. But what present and former residents of those.buildings want to know is, who's going to put a stop to it?While a city probe into that and other practices enters itsthird year without resolution, many see the wheels of justiceturning-the wrong way.


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Short Term NotesSpeculation Movesto Chinatown

ON THE EASTERN EDGE OFChinatown, in the ManhattanBridge's shadow, sits 87 Madison Street,which for the last several weeks has beena vacant lot. The five-story walk-up thatused to be there became vacant in August, after several months of what formertenants have characterized as continualharassment-and just a few days beforethe building's owner secured approval tobuild a high-rise condominium development on the site. The story of 87Madison confirms the worst fears ofsome Chinatown observers who believethe community's identity and livelihoodare threatened by a current trend towardbig money real estate development.The building was acquired in September, 1979 by Thomas Lee, president ofan investment group called the OverseasChinese Development Corporation, andbefore long, according to affidavits filedin October by ten former occupants,maintenance and repairs at 87 Madisontook a downhill slide. Tenants said theycomplained about sporadic heat and hotwater, a broken entry door and otherserious problems. "All we got for ananswer," said Fung King Yu, who hadlived at 87 Madison since 1975, "was thatthe building was going to be tom down

CITY liMITS/December 1981

and therefore the landlord would notrepair anything."By last spring, when Lee's group wascourting city and Community Boardapproval of the condominium plan, thestakes were apparently raised. In March,said former resident Lam Sau Yi, theowner refused tenants' rent and toldthem to move out. Some did, and, according to Lam, "Each time one familymoved out the landlord would break thewindows and seal the doors" of thevacated unit. In May, two suspiciousfires hit 87 Madison. After the secondfire, which started in the hallway outsidehis apartment door, 37 year residentFrank Fiore said Lee "put $2,000 in mypocket and told me to leave as soon aspossible." Other remaining tenantsreported the same stick-and-carrot treatment, and the last one left on August 16.On August 20, the Board of Estimategranted final approval for the OverseasChinese group to commence development on the site.Lee's attorney, Scott Mollen, discounted the tenants' tale. "We believethat those are trumped-up charges," hesaid. Mollen challenged the claim thatservices were systeRlatically withdrawnfrom 87 Madison, claiming that residents

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were duly compensated for relocating.Lee told the New York Times inSeptember that former tenants hadreceived payments ranging from $500 to$6,000.Responded Joyce Moi, a private attorney who is working with the formertenants to get further compensation:"You have to understand the circumstances. I f you're the last tenant in abuilding, you either stay there with avacant building that's being vandalizedor you take whatever you can andleave. "

"Flight Capital"In any case, Lee's pay-offs to theMadison Street residents were, from hisperspective, a great investment. Onebedroom apartments among the 143units planned for the site will sell for

$112,000, with monthly maintenancecharges of about $250. Though thebuilding site for the two 12 and 16-storytowers has been cleared, constructionhasn't yet begun. Mollen claimed theproject's fmancing "hasn't been firmedup yet." Conceding that they were "veryclose" to a financing agreement, Mollensaid the developers are "'in the process ofnegotiating with domestic sources ofcapital." Asked whether the OverseasChinese group precludes the use offoreign capital, he replied, "No, wedon't." Lee told the Times the entireproject was being backed by funds fromthe Middle East and Hong Kong.

I f foreign capital is used to build thedevelopment, called East West Towersit will mark the acceleration of alreadyheavy international investment inChinatown, and that worries somepeople. "Speculation will drive peopleout with higher rents," argued BilChong, a spokesman for Asian Americans for Equality, a Chinatown-basedorganization that's trying to organizeresistance to the trend. He explained thaspeculation could become intense as"flight capital" from overseas floods thearea's real estate market. Chong citedthe office space boom in downtownManhattan's fmancial district-withineasy walking distance of Chinatown-aa magnet for expensive residentiadevelopment, especially for nervouspeculators from Taiwan, whose futuras a capitalist state is uncertain, anHong Kong, whose British lease expirein 1997.


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Chong emphasized that speculation inventures like East West Towers has beenfacilitated by the establishment of aspecial zoning district in the neighborhood. The so-called Manhattan BridgeSpecial District, established last Marchand covering several blocks near thebridge's western end, allows for thedevelopment of approved structures thatare larger and .higher than previouszoning provisions allowed. Since thedistrict's inception, three high-rise luxuryhousing projects, including East West. Towers, have won city approval there.

Some Chinatown residents advocatesuch projects and the economic activitythey're sure to foster, but others are farfrom convinced. "We don't really thinkthese are the kinds of projects that willbenefit the people of Chinatown,"remarked attorney Moi. "We're afraidthis will drive out the fixed-incomepeople, especially the elderly."Asked about that possibility, theOverseas Chinese group's attorneyclaimed that most inquiries about futureoccupancy in East West Towers hadcome from the area, from "Chinesebusiness interests." But Chong pointedout the importance of the local working

CONTENTSVolume 6, Number 10

class population in sustaining the neighborhood's unique, self-contained economy. "People live here and work here,"he said. " I f you live in Chinatown, youeither work in the garment industry or inrestaurants. What's going to happen tothose industries if people can't afford tolive here anymore?"

Despite recent developments, thatremains a long-range question, but thereare signs of stress in the area's affordablerental housing stock. Though migrationfrom the neighborhood to otherboroughs has proceeded apace in thepast decade, Chinatown's populationhas blossomed to around 60,000,spurring a gradual expansion ofcommunity borders and straining thetraditionally crowded stock of agingtenements. And while housing conditions have generally declined, area rentshave been prodded upward by aminiscule apartment vacancy rate.Complained a Catherine Street shopworker whose parents recently returnedfrom Hong ' Kong after several years.there: "They had to take a littleapartment on Henry Street where they'repaying $490. And you know where it is?Right under the 'F ' train!"

That may be an indication of things tocome in Chinatown, but the neighborhood's fate isn't sealed yet. ThoughCommunity Board 3 originally approvedboth the Special District and plans forEast West Towers, charges of tenantharassment later led the Board to form a"fact-rmding committee" to reconsiderboth. (public hearings had been held onboth issues, but Chinatown residentspointed out that notices never appearedin Chinese language media). The committee's recommendations, presentedand approved at an October 27 meetingof the whole Board, called for therevocation of East West Towers' building permit and suspension of the entireSpecial District, at least until tenantharassment allegations have been investigated.

The unprecedented action took cityofficials by surprise, but a City PlanningCommission spokesman told the Dai/yNews, " I f there was harassment, stepswill be taken regarding the [East WestTowers] permit." A month later, thepermit and the Special District were stIliin place, but most Chinatown resiaentsprobably didn't notice-they were busyrunning a community. OT.L.

( CITYLIMIlS)ISpeculation in Chinatown . . . . . . . . . . . . . . . . . . . . . . . . . 2 Illy.etcept JunelJuly andthe Association or-NeighI d s t i t d { ~ Center for Comransit Tax Breakdown . . . . . . . . . . . . . . . . . . . . . . . . . . . 4

Neighborhood Developers Chart Course . . . . . . . . . . . . . 6A Small Loan Program . . . . . . . . . . . . . . . . . . . . . . . . . . . 7Putting The Heat On . . . . . . . . . . . . . . . . . . . . . . . . . .. . 8Tales of Crown Heights . . . . . . . . . .. . . . . . . . . . . . . . . . . 12Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19Public Service Commission . . . . . . . . . . .. . . . . . . . . . . . . 20A Landlord Comes Back . . . . . . . . . . . . . . . . . . . . . . . . . 23

Cover photo by Marc Jahr

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$ 3 i t y l . " t ~ i t ~ (IS$N oOl99"()33Q)Editor . " . , ,_ , . ' . i\ l:> ,./ , ,, , " , . , Tom RobbinsAssistant Editor, ... , . , . .' . ' . . , , . , . . . . . .Tim LedwithAssiStant. J:lditor " H ., ....... ' ' ' ' '.' c: .... Susan Bald.winI)esigll alld Ltyout .. > . " ;,. ,. Louis FulgoniC < > p y t i ~ J t t J9/fI.All " i g h ~ reserved,No portiOlIor porti01/s o jIhis}oU{'n(ltf!tIl)'i?e.rep""ted withollt tit, ,xpress written ~ r miSsio4o/thepubJl,fhers;TIlls"'''. 1UIck!d tlmmlh .,. ....New York (:om-IDIIJIiCYTr.-.

CITY LIMITS/December 1981


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Breakdown'on the Transit TaxExpressA s NEW YORK CITY'S MASStransit creaks toward what manyriders view as almost certain disaster, areal estate tax measure designed to infusethe system with much-needed operatingdollars may soon be derailed.The measure, a special tax on thetransfer of large, "income-producing"properties concentrated in ManhattlUl,was opposed during the State Legislature's fall session by the city's real estateindustry and Mayor Edward Koch, whounsuccessfully sought to replace it withincreases in two existing real estate taxes .That proposal, in turn, was attacked bypublic interest and riders' groups as ameager substitute, and it failed in a midNovember State Senate vote. But whenlegislators return to Albany for a specialsession starting December 16, so will thelobbyists from both sides of the transittax track.The current tax is a 10 percent levy oncapital gains from the sale of real estate

,i .\It .! II


valued at $1 million or more (Capitalgain is the difference between the price abuilding sells for and the original priceplus the value of any improvementsmade). The tax emerged from the Legislature in July as part of a five-tax package designed to hold the fare increase toa mere 25 percent. The package alsoincreased some small business taxes andhiked the downstate counties' sales tax-all told raising $780 million in annual~ p e r a t i n g subsidies for the bus, subwayand commuter rail system.The unsuccessful replacement bill, offered by the mayor and supported byreal estate interests, would instead haveincreased the existing mortgage recording and transfer taxes on the sale ofproperties worth $500,000 or m o r ~

$50 million lostBoth incarnations of the transit tax,

their legislative supporters estimate,

could raise about $30 million annually,but some supporters of the current,capital gains levy say it could raise a lotmore. The Straphangers Campaign, atransit-oriented affiliate of the New YorkPublic Interest Research Group, claimsthat at least $50 million in tax revenuewas lost between August 1 and October1, when implementation of the capitalgains tax was delayed at the city's behest.The delay, the mayor's office claimed,was needed to get the tax collectionmachinery in place. During that twomonth period, Straphangers researchrevealed, about 130 properties worthmore than $1 million each changedcorporate hands in Manhattan alone,amounting to over a billion dollars inaggregate sales. Though they note thatthe two months' feverish trading wasprompted in part by the impendingwindfall tax (a September 6 headline inthe New York Times real estate sectionsubtly advised, "Save a Bundle: Close by


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October 1") , Straphangers representatives point out that, at this rate, thecapital gains levy would generate over200 million transit dollars a year.

Claudia Wagner, a spokeswoman forKoch's legislative office, challenges thatpossibility. "Deals can be easily structured to get around the [capital gains]act," she claims. "Litigation on bothsides will go on for years. Collecting thetax will be extremely problematic." Toillustrate, Wagner notes that only$100,000 in tax revenue was collectedduring the measure's first six weeks ofexistence.The capital gains tax's proponentscredit that low figure to real estate industry anticipation that its tax burden will belightened considerably during the December legislative session. The flurry ofhigh value transfers before October I,they add, reflected the real estate industry's conviction that, despite the city'sclaims to the contrary, the tax is quitecollectible.Frank Domurad, NYPIRG's tax reform director, admits that the levy hassome flaws that might allow corporatemovers and shakers to transfer ' multimillion dollar properties in smallerparcels of stock, thereby duckingtaxation under the capital gains formula."But we think whatever technicalproblems there are can be solved bychapter amendments," Domurad insists."Look, no matter what kind of tax youimpose, large firms will hire people atvery high salaries to help them avoidpaying it."

Uncertain income?But the mayor's representatives insistthat, even beyond the question of corporate tax-


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r Neighborhood Housing Developers Chart Their Course, ' M E R E LY SURVIVING THEnext couple of years, withoutputting out services to our communities,would be a major defeat," said BonnieBrower, the new director of the Association of Neighborhood Housing Developers recently.

At a recent weekend retreat, the Association, a major membership group ofNew York City community-basedorganizations, founded in 1974,mapped its needs for the coming year, aswell as the strategies it will have to pursue in order to achieve them.Almost a full year of the Reagan era '

has yielded a host of cliches about thesurvival course for neighborhood organizations. "Volubteerism," "publicprivate partnerships," and "self-sufficiency" are three most commonly heard.With subsidized public employment forneighborhoods (CETA) and many of thefederal programs that fueled communityactivities now relics of the past,community groups have been goingthrough a retrenchment of their own.The cliches, no matter how difficult toachieve they may be, are leaping of f thepages of grant proposals and into everyday parlance with an emphasis they didnot previously possess. Groups everywhere speak of lean times to come and agreater self-reliance than ever before.The Association has had to do a substantial amount of retrenchment itself,both in its central operation and withinmost of its 22 member groups. It is currently emerging from a rocky transitionthat included loss of a CETA publicservice employment contract that, at itspeak, employed almost 500 neighbor-hood workers placed with nearly 50organizations. Like other' umbrella"CETA sponsors, a good deal of ANHD's C)structure and thrust grew around the eprogram. Loss of the contract meant notonly losing almost ha lf of a staffof o..lthirty, but a part of the organization's '"direction as well. housing movement in New York hasoften lacked.At the retreat, ANHD members At least a portion of that task will falldermed as a priority the need for to the Association's new directorimproved communications and the Bonnie Brower, a former managingdevelopment of a network among the attorney for East Brooklyn Legal Ser-groups that will enable organizations to vices and deputy general counsel forachieve a cohesiveness the neighborhood sales at the city's Department of Housing

CITY LIMITS/December 1981 6

and Preservation. Brower said the Association will put a renewed emphasis onits role as a policy advocate for neighborhood development. The Associationwill take leadership in analyzing existinggovernment legislation and regulationsand will propose new housing and neighborhoods initiatives.One mutual problem for neighborhood groups articulated at the retreatweekend is a response to new HUDregulations that mandate tenant selectionin federally subsidized rehabilitation andnew construction projects by lottery,without preference towards long-timeneighborhood residents in need ofhousing. The Association will host anearly December meeting for groups concerned with that issue to help form aresponse.Provision of needed services on thepart of the Association and membergroups will playa key role in building thefoundation for its activities. The Association is in the process of computerizingthe administration of several consortiathat provide reduced rates for heatingfuel, liability and health insurance tocommunity owned and managed housing.

"The nature of ANHD as an umbrellaorganization of housing and communitydevelopment groups that is city-wide andmulti-racial is unique," said Brower."We're going to be expanding ourmembership tremendously so tha t itbecomes even more representative of thehousing movemeJ)t in New York City."One continuing problem for the Association since its founding has been a gapbetween the needs of older, larger andmore sophisticated groups and younger,smaller organizations. Can theAssociation bridge that gap? "One ofthe best things said at the retreat," saidBrower, "was a real recognition on thepart of our members of a need topromote and involve themselves in issuesthat may not be primary in their areas.There was a recognition of the need forjoint action, and a need for ANHD to bethe spokesperson oli issues tha t may notaffect each and every group but tha t arestill crucial. There will still be a certainamount of competition and jealousy,"she warned, "but from the largest to thesmallest there was a sense of willingnessto work together."0 T .R.


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A Small LoanProgramThat MakesA Difference, ' W E W O U L D N ' T B E W H E R Ewe are now today ifwe hadn'thad help, such as the dumpsterprogram." So said Ellen Baisden, a27-year resident of 2460 Seventh Avenuein Harlem. "Everything that could gowrong here has, but now the tenants areturning this around." .Begun in May, 1979, with a $5,000revolving loan fund from the ConsumerFarmerFoundation, the Dumpster LoanProgram was designed to provide interest-free loans to tenant groups withlimited resources doing their own rehabilitation work (sweat equity) in cityowned, tax-foreclosed buildings. Theprogram is administered by the UrbanHomesteading Assistance Board and isone of the best local examples of how fara small investment can take a largenumber of people.Most of the buildings using the dumpster program are in the c i t y ~ s TenantInterim Lease (TIL) program, althoughseven on West 105th Street in UpperManhattan are being renovated by theWest 105th Street Homesteaders with aninnovative loan from the NationalConsumer Cooperative Bank.Since the program began, 104 buildings with a total of 2,216 apartmentshave used the program. According toDenise Powell, administrator of thedumpster loan program at UHAB, 697apartments have been cleaned out, representing a service to more than 7,000people. She also said that a total of 178tenant associations and communitygroups have either received loans orassistance in securing containers.

" It is not the solution to the serioushousing crisis, to Reagan, or to rats, butit is an answer to people who are tryingto ftx up their buildings and get rid ofdebris," said Martin Young, of theConsumer Farmer Foundation. " It hasaffected the lives of a couple thousandtenants. Nineteen buildings have beensold as cooperatives, and this is a miraclefor low income people who want to ftxup their homes."

Dumpster fees range from $150 for thesmallest (15 yards) to $220 for the largest(30 yards). According to Powell, mostgroups have used the program when theyhave a cash flow problem but are fairlyprompt in paying back the loans.

"W e have used the program abouteight times, and we have done quite a bitto clean out our building, " said Baisden,who serves as the bookkeeper for thetenants association at 2460 SeventhAvenue. "But we usually payoff theloan in full before the monthly installments begin ." Baisden's building, whichentered the TIL program in March,1979, with only 18 occupied apartmentsof a total of 52, now has only eightvacancies and boasts a large waiting listfor four apartments ready foroccupancy.

At present, the tenants are engaged insweat equity rehabilitation and arehoping to buy their apartments possiblynext year at the city's stated low incomeprice of $250-a-unit. The building's current rents are $200-a-month for fourrooms, $275 for six rooms."W e have large apartments and are

proud of our building," Baisden asserted, noting that the tenants have heat andhot water "every day of the year, but wehave to ftx this plumbing because i t willonly get worse. We really could use somehelp for this from the city."

In addition to making use of thedumpster pr.ogram, 2460 SeventhAvenue has been receiving constructionmaterials from the city's Department ofHousing Preservation and Development7

to repair the apartments.Another building-970 TintonAvenue in the South Bronx-used thedumpster program with less success."W e paid $250 at one shot for thedumpster, but we didn't have it long

enough," said Inez Owens, a 13-yearresident and organizer of its tenantsassociation. "W e needed it much longerIt's a nice thing, but we could have usedit for at least a month. Unfortunately,the city says a normal period is two daysbecause the dumpsters are so much indemand." As a result, according toOwens, the tenants had to throw most othe debris on the yard of an adjacentvacant building.

Her building, however, was fortunateto receive volunteer labor from theNeighborhood Work Project, a programrun by the Vera Institute of Justice,which employs ex-offenders astemporary workers until permanent jobsare found for them. The NWP workcrew spent a month last spring cleaningout the debris from the backyard andmaking repairs to vacant apartments. Asa result, Owens was able to run a neighborhood youth employment program fo35 young people and provide a summerlunch program which fed some 1,000local residents."W e need all the help we can get tosave this housing," Owens concluded."It's not a bad block for the SouthBronx. We only have one abandonedbuilding, but before we can buy ourapartments from the city, even for $250,a lot has to be ftxed, particularly theplumbing and electrical problems. ' 0 S.

CITY LIMITS/December1981


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Putting the HeatOn, This YearBy TI M LEDWITH

CHRISTMAS BROUGHT THEunlikely gift of an arctic chill toNew Yorkers last year and, with intermittent relief, the chill stayed put for the restof the season. By the end of the winter,in which temperatures averaged nearly20 percent lower than usual, GovernorHugh Carey had been prompted to openNational Guard armories to shelterrefugees from heatless buildings, at least13 New Yorkers had died of exposure tothe cold (along with countless others whofell to cold-related illnesses and fires) andtenants had filed 283,000 complaintsabout ill-heated apartments with the cityhousing agency.Banner headlines and television newsshows steadfastly covered the winter'shorror stories, calling attention to thequestions of public and private accountability they raised. But as the last snowof the 1980-81 season melted away, sodid media attention. And as the winter of1981-82 begins in frosty earnest, manypeople who live and work in the neighborhoods hardest hit last year are wondering whether, in the absence of a mercifully mild season, they will be iced outonce again.On paper at least, the standards andprocedures designed to prevent such afate are pretty clear. During the heatingseason-October 1 to May 31-the minimum requirements are as follows: from6 AM to 10 PM, i f it is below 55 degreesoutside, the inside temperature must be68 degrees; between 10 PM and 6 AM, ifthe outside temperature is ' below 40

CITY LlMITSlDecember 1981

degrees, it must be at least 55 degreesinside. When landlords fail to meet thesestandards, tenants can call the city'sCentral Complaints telephone number(960-4800) to get their giievances on therecord. According to the prescribed procedure, once a complaint has been filed,the building owner or agent is to becalled and asked if he or she is aware ofthe problem. I f the landlord says thesituation has been or is about to beresolved, the tenant is to be called backby the housing agency the next day andasked if the chill persists. I f it does,Central Complaints is supposed to notifythe appropriate borough office, which in 'turn is expected to dispatch an inspector.

So far, so good. According to the Department of Housing Preservation andDevelopment, a quarter of last winter'sheat complaints were resolved throughcallbacks. But in light of the importanceof getting apartments inspected whenheat complaints aren't so easily remedied, tenants point with concern to thedecline in recent yeas of HPD'sinspection force; the group dwindledfrom over 600 inspectors in 1975 to 387last year. According to Joseph Shul-

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diner, head of the agency's Evaluationand Compliance unit, the force is backup slightly this year, with 410 full-timersand 33 trainees hired iIi September.However, Shuldiner points out, onlyabout 250 inspectors actually work in thefield.That group, even at the level of 9.8inspections performed each person-dayas projected for fiscal 982 in theMayor's Management Report, would beoverwhelmed by a prolonged deep-freezelike last January 's, when housands ofcomplaints poured in daily. $190,000 isbudgeted for inspectors' overtime thisyear. Under last January's unusuallyfrigid conditions, even a mayoralinfusion of $715,000 to 'ncrease theinspection force failed to get the systemback on track in many neighborhoods.

A SSUMING A VISIT FROM THEinspectors' thin ranks can be secured, and the cold truth of a heat violation verified, one immediate course ofaction open to tenants this year, as in thepast, is the city's Emergency RepairProgram. Funded mainly ith federal


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Community Development dollars, theprogram is composed of 40 city employees and about 90 subcontractors whoprovide repairs an d heating fueldeliveries in extreme cases of landlordnegligence. Last year, more than $13million was spent on over 26,000 ER Pjobs city-wide. Since federal funds forfiscal 1982 are in place, tills winter's ERPspending should not be affected bybudget slashing in Washington: thisyear's emergency repair budget is set at$8.3 million, and the program's actualexpenditures can be expected to exceedthe budget projection by several milliondollars.

About half the current ERP fund isearmarked for heating fuel deliveries,and in cases where a tank of fuel is allthat's needed to thaw out a frozenbuilding, the program offers residents anoft-used option-provided that a violation has been verified and the landlordallows access to the tank. An alternativeto the possible bureaucratic pitfalls ofthe emergency repair process is availableunder the 1979 Fuel Buying Law, whichallows tenants who are without heat forat least 24 hours, and who can't get satisfaction from their landlords, to buyheating fuel and deduct it from theirrent. Tills alternative, of course, illngeson residents' ability to accumulate alarge enough rent roll to make thepurchase. If they can't, or if the heatingsystem needs more than fuel to breathewarmth into the building, tenants areback to relying on city aid or pressurefrom the courts for immediate relief.

The latter option is a virtual standingjoke among tenants, organizers and evenpublic officials who have tried to utilizelegal pressure to resolve heat violations,but they' re still trying: 3,149 heat-relatedcases passed through the city's housingcourts last winter; about 900 in the formof tenant-initiated actions, the restbrought by the city housing agency.Bruce Kramer, head of HPD's litigation unit, which is responsible for prosecuting heat violators, calls tenant-initiated court action in heat cases "the key tothe system." Kramer concedes that thehousing agency, with current resources,"is not going to hit all the buildings withheat violations." As for the criteria hisunit employs to choose which landlordswill be prosecuted, says Kramer: "We'remore apt to pick a building where there's

J

As winter and the first complain ts of heatless apartments commence, sometenant activists aren't leaving r e n ~ ' . fate to f1atUte's w ~ s . Two organizations-the New York State Tenantand NeighborhOOd Coalition and the Newyork Public Interest Research Oroqp's Citizen's Allianc-have a J r ~ d y ap-proached the powers that be with some hard questions about the city's ability todeal with potential problems dtllin$ the current heating season.

NYSTNC's Code Enforcement Committee, which started meeting on theheat. issue in October, has developed a set of heat enforcement measures that,thearoup says, should be taken bY the J')epatUnent of HousingPreservationand Develcfpment and CityHan.The list includes demands that: the number of housing inspectorS be inreased to pre-l97S levels HPD insure effective levying andColleedonof f),nes the housing agency educate the public and use the tpedia toinform tenantsabdut heat-related actions. pIaemUlti . ingualadve rtisementsin subways andbuses and that informationsheets be distributed by inspectorsat the time ofinspection. litigation staff at HPD be increased so that there wiD be a ratio of oneattorney to twenty inspectorsHPD litigation procedures be streamlined th e housing agency SUI)J)OCUegil.lationi",iUc;hwiD require in heat complaintcases that a judgemust and civilm l a l t i ~ e s to be imposed on thafi two COUrt dates

m p u J a t i o n b ~ ~ n ~ ~ ~ ~ i m o .

i . ~ I U e s t ........ ofheat e n ~ O r d i _ l l t o p e n l t i o l l 1 S E n : l e r ~ t e n c ; y Repair Program. In an HPD spokesman said the agencywould establish an advisory tenant committee to improve heat services.Another demand-that the city adopt minimum building weatherizationstandards and deny non-complYing landlords "fuel passaJongs" they get unde rcurrent rent regulations-was rejected by the housing agency representative.

Another demonstration, thison e scheduled by NYSTNC for December 9,was planned to memorialize tenantswhO died last winter from exposure to the


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A CCORDING TO THE STAtute, landlords found gUilty in heatcases are liable not only to substantialfines, but also possible imprisonment.Last winter, however, only four violatorswere jailed. So fIDes appear to be thecity's biggest potential stick.On the current heating season's openday, Mayor Edward Koch signed intolaw a bill which raised fines for buildingowners who don't provide heat and hotwater from $25 to $250 per violation, perday. The bill also created a minimum$1,000 penalty for the use of illegaltiming devices on boilers which causecentral heating systems to shut offduring certain times of the day or night,not based on the outside temperature. Ina statement released the day these stifferpenalties were announced, HPD Com-

missioner Anthony Gliedman called thebill signing "a message to negligent landlords throughout the city that we intendto take serious action to protecttenants."In practice, though, the effect of thesestiffer penalties is questionable. SteveCruz, who works for the Saint NicholasHousing Development Corporation innorth Brooklyn, isn't impressed. "Whether it's $25 or $250, it'll be the samething," he ~ s s e r t s . "Th; vast majority ofviolating landlords won't be fined."Observes HPD's Shuldiner: "It's impossible to say what this will do." In thepast, Shuldiner says, the Departmentnever sued for penalties in heat cases.

"That would take two weeks," he states,so instead the agency has generallymoved for more immediate court "or-

ders to correct" when prosecuting violators. Last winter, HPD actucollected no fIDes fo heat violations,$326,000 iIi judgements for contewere levied against landlords who fato comply with orders to correct vitions. Shuldiner is certain about hmuch of that was collected, but agency .reportedly collected $590,00fines for all code viQlations during fi1981. As far as HPD's choice this seabetween suing for t e new, stiffer for for contempt judgements, states Sdiner, "We'll probably do a littleboth."Meanwhile, tenan s around New Ywill once again try to turn the ofrozen dials of the city's heat-generalegal machine. 0

Coping With the Cold,While Working forChangefigures to 40 percent for low income and 1l.5 percent fmedian income households: In New York, where ahouseholds already pay about one-third more than tnational average for,energy, home heating il has increasedprice by an armual average of 47 percent since 1973. And NeYork is more oil dependent than the rest of the nation: natiowide, less than half the heating energy used derives from owhile in New York the figure is 80 percent.

N OBODY LIKES TO THINK ABOUT WINTERwhen the weather is warm, but now that the cold weatheris upon us, tenants in poorly insulated, ill-heated buildings canplan for the even colder months ahead.Heat problems are particularly acute for low income renters,at least 40 percent of whom live in uninsulated buildings. In1978, poor people paid a national average of 33 percentof theirincome for energy costs. The median income household paid9.6 percent. Energy price increases since then bring those


In addition, relatively few New Yorkers ontrol their owheat. Multi-family (six or more unit) buildings make uppercent of the statewide housing stock, compared to 20 percenationally, and are concentrated primarily in New York CitLargely because of this, 83 percent of New Yorkers don't hacontrol of their home space heating, compared to 39 percenationwide.

It is in large rental buildings, then, that tenants and tenanadvocates often try to reverse owners' traditional economapproach and set new priorities. In terms of priorities, the onway owners can immediately reduce fuel consumption, aenormous energy expenses,is through weatherization: instaing storm doors and windows; insulating alls, ceilings aattics; tuning furnaces; insulating heating pipes and ducsealing cracks in foundations and walls. These are expensivbut in the long run cost-effective, measuresShort of such measures, tenants have tHe unquestionabright to demand certain "amenities" necessary for thesurvival. The demand for adequate heating is justifiabaddressed to government agencies and landlords, but it is oftmet only to the point of assuring that nobody freezes to deain his or her apartment. Beyond that extreme are the everydneeds to keep sickness away, have healthy children in schoomaintain working capacity and protect the ability to tb inthe strongest political tool.To help meet those needs, low and moderate incomresidents can become involved in protecting emselves frothe rigors of cold weather. The materials n ed should not seen as obstacles; a host of relatively cheap products thprevent the outside cold air from penetra,ting the indoors a


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available. One possibility for covering the costs of basicmeasures like weatherstripping and caulking is throughnegotiation with the landlord or manager. Or, the owner canprovide all materials and renters can do the work, aftertraining and under supervision if necessary, as is often donewith apartment painting jobs. I f the cooperation betweenrenters and owners is effective, and savings are large (a wellweatherized building will reduce fuel consumption by 15 to 40percent), further arrangements, such as reworked rentalcharges or revolving funds for additional energy conservationactivities, may be in order.

-Women's Energy Tool Kit, Home heating, cooling andweatherization. A workbook for residents in large and smallbuildings. Includes information on basic installation of energysaving materials, as well as tips on what materials to use.Available for $5.95, plus $1.50 postage and handling, fromConsumer Action Now, 355 Lexington Ave., New York, N.Y.10017.-Stay Warm (And Save Money), Energy conservation fo r oldlaw and other small apartment buildings in New York City. Amanual for conservation directed primarily toward operatorsof three-to-five story walk-up buildings, this book alsoincludes detailed instructions for tenants who want toweatherize their apartments. Available from the New YorkCity Energy Office for $3.50. For information call the office'sEnergy Line at 349-2951..

As far as implementation is concerned, a number of resources are available for tenants who wish to implement basicconservation measures in their homes. Some of these are:-No Heat, No Rent, An urban solar and energy conservationmanual. An introduction to energy conservation techniquessuitable for a typical New York City tenement building.Available for $1.50 postage and handling, free if you pick itup, from the Energy Task Force, 156 Fifth Ave., New York,N.Y. 10010.

-The Brooklyn J


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Tales of Crown Heights:The Fruits of Harassment y Tom Robbins

THREE YEARS AGO, A TEMPEST OF CONTROversy raged across the Brooklyn community of CrownHeights. A volatile area to start with, the neighborhood hasfor several years been the scene of an ongoing tussle over turfand power between a large black and Hispanic populationand an expanding community of Hasidic Jews.The storm thundered into the open with a wave of rentstrikes in buildings tenanted mostly by blacks and Hispanicsand owned by a prominent Hasidic community leader. And,as TV cameras rolled on scenes of occupied apartments wheresledgehammers had broken through floors and walls in thename of renovation, tenants told their stories of harassment.Then, gusting from another direction, the storm grew whenCity Council President Carol Bellamy released a report detailing major alleged abuses and fiscal irregularities by a Hasidicanti-poverty and housing organization.At the center of the storm was Rabbi David Fischer, headof a host of private realty and management corporations, andDirector of Chevra Machazikei Hashcunah, the LubavitcherHasidic community's major housing and social service agency. The rent strikers and their supporters minced no words


naming Rabbi Fischer as the chief culprit in their troubleCharging that he was bent on driving them from their homesthey challenged the city to bring him to account. Some 25strong, they marched on the Kingston Avenue building thadoubles as Fischer's private management office and Chevraheadquarters and then on to Fischer's Montgomery Streehome.At its zenith, the rent strike included a dozen Fischeowned or managed buildings, all of which told a tale of strikingly uniform dimensions: large, four or five story cornewalk-ups, located in the midst or at the frin e of the Lubavitcher community, all tenanted by families, most of themHispanic or black (one building in the strike, 658 Montgomery Street, housed mostly older, non-Hasidic Jews); all suffered a sudden decrease, and then a cessation of essentiaservices upon purchase by a new owner who invariablemerged as Rabbi David Fischer under one or another corporate guises. The scenario was always folIo ed by offersand sometimes threats-to move. Then, as the various buildings shared their tales with each other, an important link ithe stories appeared: all of the buildings had been accepte


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for some form of government-subsidized renovation.But while tenants and others waited for the officialresponse to their charges and the Bellamy report, the stormgradually subsided. The Bellamy report, and the massive research behind it, was offered to federal, state and localinvestigative agencies for action. Soon, the FBI, theDepartment of Labor and the city's own investigation department were scrutinizing the finances and practices of Chevra.Those new probes, however, turned out to be 'only morethunder and lightning, signifying no change or relief for thetenants.In their wake, the high waters of the Crown Heightstempest left power and funds in the same hands, with only acouple of names and titles rearranged. Today, when told thata two-and-one-half year probe by the city's Department ofInvestigation is soon to emerge, most of those involved in theFischer/Chevra struggles of 1979-80 nod knowingly andsmile. "Rabbi Fischer Wa5 exposed," said Ai Rowe, a softspoken civil servant who was part of the only harassment casethus far won against Fischer, for management practices at836"Montgomery Street. "It was on TV, radio and in the ,papers. The City Council President herself denounced whatwas going on. But what's changed? He's still going on abouthis business."The side people are on in this strife-tom territory determines their viewpoint of that ongoing business. To RabbiYisroel Rosenfeld, Executive Director of the Crown HeightsJewish Community Council, the charges against RabbiFischer have never been anything more than "asmokescreen" for political interests aligned against theHasidic Lubavitcher community." I f they (the allegations)were really true, do you think he'd be out walking thestreets," asked Rosenfeld. "Wouldn't he have beenindicted?"Bruce Fogerty, an attorney for the city's Department ofInvestigation insists that the department's fmdings will soonemerge, but warns that they will show "nothing shattering."And, while the 001 spent the past two-and-one-half yearslooking into Bellamy's and other charges, there has apparently been little political incentive to push for results. "It'ssomething that has basically gotten'lost in the bureaucracy,"said Bellamy aide Rosina Abramson recently. "The CityCouncil presidency isn't'a law enforcement agency and thereis little we can do at this point."

A deal to save a section 8 jobJust how little the hubbub of three years ago changed 'the

continuing political power of Rabbi Fischer is illustrated bythe events surrounding the rehabilitation of two CrownHeights buildings using federal Section 8 subsidies.Both 1577 Carroll Street and 440 Brooklyn Avenue werefully occupied when Fischer sought federal funds to rehabilitate them in 19]7. And, like 836 Montgomery and otherbuildings, tenants said that conditions began to go rapidlydown hill after Fischer took over. But when the rent-controlled tenants of the two buildings brought their charges ofharassment before a departmental hearing officer at the city's

up at the buildings department, blocking the renovation permit Fischer sought.Under city law, the "flag" meant no construction couldproceed until the harassment charges were either dropped orproven. Should the charges be sustained, and then signed bythe rent control commissioner, in addition to any fines leviedagainst the owner, the apartments could be kept under rentcontrol for a minimum of one year, and then only removedwith the commissioner's approval. The complaints appearedto be the kiss of death for the $4.3 million project for which,according to the sponsor, Chevra, almost all the financingwas in place.But instead of collapsing, the rehab was rescued by sometimely maneuvering. Marvin Schick, a former administrativeassistant under Mayor John Lindsay and an influential voicein Brooklyn and City Hall, was brought in to piece together arescue plan. Painstakingly, a deal was arranged so thattherehabilitation would go forth.Under the terms of the agreement, which was signed byHousing Commissioner Anthony Gliedman and RabbiFischer in December, 1980, Fischer and Chevra would bowout of the rehab, turning sponsorship of the job over to the

rent control board, the plunge into vacancy was, at least tem- /365 Carroll Streetporarlly, halted. The harassment charges caused a flag.to go13 CITY LIMITS/December 1981


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Crown Heights Jewish Community Council. Fischer, the dealspecified, would have nothing more to do with the project,save for occasional consultations. With a nod toward thedepartmental hearing at the rent control board, the agreement obligated the sponsor to set up a fund, managed by atrustee, out of which any city fines would be paid, as well asany harassment damages levied against Chevra or Fischer bythe courts. The fund was to be equal to four percent of theproject's gross mortgage-about $140,000. The project sponsor was also mandated to reach out to all tenants who mayhave been displaced and advise them of the existence of theproject fund, as well as let them know about rent-up and theirrights as former occupants once the apartments werecompleted:Thus, while the lawyers of one wing of HPD, the Divisionof Rent Control, argued the tenants' case against Fischer,lawyers of the Department of Development were working outa deal to free the project from interference by the harassmentcases. The estimated profit on the project to the sponsor wasapproximately half a million dollars."One of our most important criteria is to recycle the

housing," said Andrew Chertoff, presently AssistantCommissioner for Rehabilitation and at the time counsel tothe Department of Development who wrote the agreementwith Fischer. "We wanted to penalize the wrong-doers, andyet not deprive the community."With the agreement signed, and Marvin Schick madetrustee for the fund, the rehab went forward. The last tenant

370 Kingston A venue, management and rental offlcefor Chevraand privateFischer corporations.


to finally move out of 1577 Carroll Street was Melvin Grawho had helped coordinate the rent stri es. Grant finalpacked his bags and pulled out, after months of livinwithout heat or hot water, in Decemlier, j ~ s t when the agrement between Gliedman and Fischer was signed. The harasment cases of both 440 Brooklyn Avenue and 1577 CarroStreet were completed by the hearing officer last spring. Thestill, however, remain unsigned and unreleased. According an HPD spokesperson, the cases have had to be rewrittebefore Assistant Commissioner for Rent Control, RobeMuniz, can sign them. "We want the strongest possibcase," said the spokesperson.According to those familiar with the sti unsigned casethe opinions are basically similar to the 36 Montgomeharassment suit that was signed last June. In that decisiohearing officer Paul Blank wrote that there had been "ovewhelming testimony" that Fischer and his ~ g e n t s were guilof being "callous and disruptive influences and had cause"intentional interference with the c o m f o r t ~ repose, use anenjoyment of the building." Fischer and ~ i s agent, JosepBlizinsky who is on the board of the Council, were fmed $1 ,0on each of eight counts-including one for intent to cauvacating of the building.

If , as Chertoff insists, the incentive for the agreement beween Fischer and HPD was to prevent him from benefittinfrom similar harassment activities at the Section 8 buildingthere is little to show in the way of enforcement. Not onethe major aspects of the agreement have been carried out.According to Schick, there has never been any need for thproject fund for paying fines and damages, therefore nonwas ever established. That, he said, has obvi ted any need fothe quarterly reports he is mandated to proVide HPD undthe agreement. Nor has HPD requested any.Richard Singer, partner of Hirschen and Singer, a firmrepresenting many Section 8 sponsors including Chevra anthen the Council, said he had been informed by his client thagreements with all the former tenants had been reachedSinger, however, declined to share the agr ements with reporter, for fear of "starting a bidding war" among thformer occupants.But, in the most glaring noncompliance ith the agrement, Rabbi Fischer has continued to handle all the procesing of the project with HUD and is openly serving as managfor the project through Shipur Masbchunna of which hethe principal, despite specific language in his agreement wiHPD forbidding him to do so. How did t h a ~ happen? "Thcity is aware," explained Singer, "that we can't make thentire Lubavitcher community disappear in relation to theproperties. The reality is that he [Fischer] is tlie most familiwith the area."

Who's Who in Crown Heights?Rabbi Fischer's continuing role as de facto sponsor of thproject, known as Carbrook Apartments, is not surprisinleast of all to city officials. As things settled dQwn again aftthe Bellamy report, Chevra's role as the ho sing developfor the Lubavitcher community was quietly passed to thCrown Heights Jewish Community Council, creating thtransP


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developer. It's a charade that Rabbi Rosenfeld himself readilyadmits. Although Fischer is neither board member nor staffto the Council, he remains its housing packager. Dependingupon who is asking, the Council has different descriptionsof its relationship to Chevra. In its submission to HUD tosponsor 117 units of Section 8 substantial rehab, CHJCCdescribed Chevra as its own "housing component'" and, as ittold Con Edison recently after the utility's public affairs officer visited the community, "Regarding special housingprograms for Crown Heights, p ~ e a s e have your housingspecialist contact Rabbi David Fischer, who heads up ourhousing corporation." But, in a submission to the stateDivision of Housing and Community Renewal recently,Chevra was described, at somewhat more of an arm's lengthdistance, as "a local organization that sponsored redevelopment of Ihousing in Crown Heights and manages severalapartment houses." .

Asked 'directly" Rosenfeld himself is somewhat morestraightforward about the connection between Fischer andthe Council ."He runs all the housing for us," said Rosenfeldsimply. "It's a-quasi-official relationship." He could add thatthe "quE;lSi" a s ~ of the relationship is all that allows thecity and others to say'they are drawing a distinction betweenthe two.

A ,hotel for Carroll StreetRecently, the Council made a bid t6 include 836Montgomery Street and other preperties in an application for .federal Section 235 low interest mortgage subsidies for bothnew construction and rehabilitation. That plan w.as dropped,however, when federal funds for the program were cut.But, in the pattern established in its Section 8 designatedbuildings, the Council is currently awaiting the verdict of the

federal Small Business Administration on its plan to turn apartially-occupied building at 1365 Carroll Street into a hotel.The Council is seeking an SBA loan guarantee to cover a $1.5million loan from Manufacturers Hanover Trust that willallow it to create 75 transient and perrnanenthotel rooms.Per day costs for the rooms are targeted at $40, saidRosenfeld, but the Council is presently trying to "work outthe numbers" with the SBA which has said rentals should becloser to $60 per day.Who would stay at the hotel? "Visitors to the neighborhood," said Rosenfeld. As the world headquarters of theLubavitcher movement, and home of its leader, RabbiMenachem Schneerson, there is a substantihl traffic ofstudents and pilgrims in and out of the neighberbood, and anapparent scarcity of boarding space. Visitors are housed inseveral buildings belonging to Rabbi Fischer, in apartmentsvacated by tenants who have opted to leave rather thanremain. 1365 Carroll is one such Fischer building and ispresently about half occupied, with some of the empty apart-Iments used by those passing through. Those tenants whohave been there between ten and 16 years are all ' black orHispanic. Most of them have been in and out of housingcourt with Rabbi Fischer in recent years. One family that haslived there for the past 14 years is Luisa and William Campizand their son Bill. -

William andLuisa Campiz in the entryway of1365 Carroll Street,Like the other long-time tenants, they have fought an 00 -again, off-again campaign for repairs and basic services sinceRabbi Fischer's Teav Realty Corporation purchased thebuilding. They glumly point out the crude bulging plasterpatches in the living room, kitchen and bedroom ceilingswhere court-ordered Fischer repairs have been made not justonce-or twice but several. times. "The apartment upstairs isempty," says Mrs. Campiz, a former teacher's aide who isnow completing an education degree so that she can teach.


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Contacting a law firm whose name he got from the radio,Campiz said he wanted to sue the owner for damages. Aftergiving over all his medical papers, Campiz received a lettersome months later from the attorney saying that it had beendiscovered that on the day of the accident the building had noliability insurance. Therefore, the attorney informed Campiz,the firm would no longer pursue the case nor represent him inany matter. The Campizes received the letter with resignation.They have found, since Rabbi Fischer purchased the building,that victories are few and far between.Eighteen months after the accident, the door frame is stillunrepaired and the same fat splinter still springs in the airwhen the door is opened. To the Campizes, and other tenantssuch as Ella Dingle, a I5-year tenant, Utilrna Greenidge whohas lived there for 13 years and has been struggling recently toget some building-wide repairs, the plans to turn their building into a hotel is news to them. Only Shalom Levine, whohas lived in the building for six months with his wife andchildren while he awaits the purchase of a home nearby, wasaware of the plan. "Rabbi Fischer told me when I got theapartment from him," said Levine, shaking his head that "none of his neighbors who were gathered in the lobby tellingtwo visitors their troubles were aware of the plan."Whoever lives in the building has agreed to move," insisted Rabbi Rosenfeld. " I f they so desire, they'll berelocated." Admitting that the building is in "pretty terribleshape" he described it as a "transient situation."The task of developing the hotel makes up a good chunk ofthe proposal the Council submitted to the state housing

division recently for an $80,870 grant under the Neighbohood Preservation Companies program. That applicatiocalls for the state to pay partial salary costs I r a Director, secretary and administrative costs, as well as fees for aarchitect and a packaging consultant all of whom will binvolved in developing the hotel. Rosenfeld, owever, is nogetting involved at this stage in the project." nstead, he saidRabbi Fischer is handling its development.Some timely weatberization for Fisc er buildingThe low proflle Chevra has been forced to take since thBellamy report accused it of spending federal funds timprove buildings belonging to board mem ers apparentlhasn't kept it from benefitting from other oPI?Ortunities. ThCouncil has received a total of $265,000 i two contractfrom the State of New York to weatherize apartment buildings inhabited by low income tenants. Weatherizatiocontracts are much sought after by com unity groupsallowing them to deliver genuine assistance t@ buildings antenants in need. Under the program, which spends federadollars administered by the state, landlords get such improve

ments as new thermal pane windows, doors an.d roof repairsThey aren't obligated to pay for any of the work, althougthey can supplement the federal funds with their own to dolarger jobs. The cost of each unit under the Council's budget$600. The community group must verify that at least twothirds of the tenants in the building are 10 income ancoordinate the work, usually done by a private contractor.Thus far, Rabbi Fischer's buildings have c;lone especiall

The ongoing Section 8 rehabilitation of440 Brooklyn Avenue, one of wo buildings where a harassment suit by former tenants is still pending.CITY LlMITS/Dece{Tlber 1981 16


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well under the Council's contract. Of just seven mUltipledwellings weatherized, said Samuel Light who runs theprogram, four , belong to Fischer. All four of these-760Montgomery Street, 701 Empire Boulevard, 456' BrooklynAvenue and 601 Crown Street-were previously cited in theBellamy report as privately-owned buildings belonging toChevra board members where Chevra-administered federalfunds were spent.While that overlapping has so far not been a problem forthe Department of State which administers the program, theCouncil has run afoul of the rules by not weatherizing apartments where minorities lived. Last year, when the Councilweatherized 150 dwelling ~ t s by Light's count, only four orfive of those apartments were occupied by minorities."Last year, we had several meetings with the state aboutour goals and priorities," said Light, as a result of which thenumber of minority apartments has substantially increased."This year," he said, "we have done 40 or 50 minorityapartments.' ,

Fair housing?Opening its services and buildings to minorities is atroubling issue to the Council as it is to those Chevra-managed buildings where rehabs have taken place. The projectcomprising 1577 Carroll and 440 Brooklyn, knowncollectively as Carbrook Apartments, is the latest in a longline of Fischer-developed HUD projects to be reprimandedfor poor rental policies. HUD has consistently faulted themanagers and sponsors (both operated by Fischer underdifferent names) for such things as failing to advertise theapartment's availability in any publications that couldconceivably reach a minority audience, for not displaying anequal opportunity sign at the project site or at the rentaloffices. In at least two projects, HUD field monitors had to ,void an entry log where applicants' names were enteredwithout reference to when they had actually arrived. Fischerprojects have relied on a first-come, first-serve system ofrent-up, thus making the logs the arbiter of who gets in.Several Black and Hispanic tenants have taken their complaints of discrimination in gaining entry to the rehabilitatedbuildings to higher levels. At least four of these have receivednew apartments as settlements ordered by the city or statehuman rights commissions. One black woman applicant,Doreen Maxan, protested to the state human rights divisionwhen she was denied an apartment for failing to submit proofof the validity of her high school diploma. Represented by theOpen Housing Center, Maxan was awarded a new apartmentwith no security deposit.The correspondence between Fischer and HUD aboutrental problems is voluminous and letter after letter detailsweary-sounding treks by HuD field workers to inspectFischer's operations. But in spite of all efforts to keep therental proper, those corrections are only a small salve for whatmany in the community see as an open, unhealed wound.Regardless of the overwhelming number of minority peoplewho lived in the buildings rehabbed by Fischer/ChevraiCHJCC, HUD has approved "affIrmative fair marketing"plans for each project that call for marketing the apartments

to whites because of what the sponsor describes as the "raciaimbalance in the community."No help from above

When leaders of the 1979-80 rent strike first began to see anoverall pattern to the problems in Fischer's buildings, theyturned desperately to elected officials for assistance. A notebook AI Rowe kept 'during the first year of his building's renstrike painstakingly details phone calls, letters and visits toofficials in search of help. An entry in the notebook reads:"4/29179: Met with Councilmal1 [Theodore] Silverman andstated our complaints-very fruitful mj!Cting." Followedimmediately by an entry in a different cdlored ink: "Neverreceived reply.'"

"The only person that helped us was Carol Bellamy," saysRowe today. "She got our hearings at rent control startedwith just a phone call."Before Bellamy, the only person willing to sit down andwork with Rowe and other tenants was Curtis Trueheart ofthe Metropolitan Council on Housing's Crown Heightschapter. A union organizer by day and a housing organizerby ni,ght, Trueheart helped pull together all the differentbuildings that came to him complaining of harassment. Arecent reunion of Trueheart, AI Rowe and Melvin Grant whoworked together trying to hold the hundreds of tenants inFischer-owned buildings in a single rent strike, was a little likea meeting of war veterans.

Kingston A venue, main shopping strip oj he Crown Heights.ILubavitcher community,

17 CITY LIMITS/December 1981


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"Back then," said Trueheart, "we didn't know the masterplan. We didn't realize all of what he was up to. We tried tomeet with him, but all we would get was an emissary. That'swhen we called of f negotiations and called a rent strike.Their efforts to close the valve that seemed to be fuelingFischer's harassment led them to HUD where they metseveral times with officials. One high level meeting was withHUD Area Manager Allan Weiner and Housing DirectorAlexander Naclerio. "It was a time when the tenants of somebuildings were being forced to live in just half their apartments, because of all the work going on," recalled Trueheart."A t 349 Crown Street (another Section 8 rehab 'carried outwith tenants in place') they had to hang blankets over thewindows because they had ripped out the frames and thesashes, they had nothing but holes. They had their furniturestacked in the center of the room because the weather wascoming in, but they had no place else to go. But at HUD, theyacted surprised, said they would look into it, and that was it.We were on a merry-go-round."

The Bellamy report, the trio recall, was the sole glimmer ofhope in an official gloom, the spark they were sure wouldmake the other politicians sit up and take notice. "Al and mewalked all over Crown Heights one night," rememberedMelvin Grant, "with about fifty copies of the report, givingthem out to tenants in the buildings mentioned in the report."

" I t was 'flustrating' " , says Trueheart, coining a favoredterm. "AlI we'd get was a shoving aside." In the view ofTrueheart, Rowe and Grant, Fischer has escaped unscathedfrom a series of troubles that should have been his undoing.

"His job is almost done," said Rowe, who with hisdaughter, is one of 14 tenants in his 40 apartment building leftsince the rent strike. What was that job? "I'll put it thisway," answers Rowe, "w e weren't bad or rowdy tenants.There weren't any cops coming around the buildings. Wewere working families. I'm sure this would only happenaround here-places where mostly blacks live. I see no otherreason why he would want to run us out."

Black-Jewish relations is a subject approached with muchtrepidation in New York City. The mildest of people havebeen known to grow vehement on the subject. The Crown

Heights confrontation, which has taken on other forms,including vigilante violence and openly racial gerrymandering is one instance where that debate takes on a very humanface. The hesitation of some officials to spring into actioncould be traced to the intricacies of that dilemma. Or, lesscharitably, the motivating factor could be the much-vauntedvoting power of communities such as the Lubavitcher, whoinevitably cast huge majorities in their districts for theirfavored candidates.

But whatever the reason, almost every level of power inNew York City has ~ h o w n no interest in pursuing the harassment-dispiacement and government subsidies cycle that hasdecided so much of the recent history of the housing stock inthat neighborhood. Nor have the charges of malfeasanceemanating from the City Council President's office received

CITY LiMITS/December 1981 18

the scrutiny they might have were they aimed elsewhere.When an attorney of the city's Department of Investigationasked Gary Deane, one of the two principal authors of theBellamy report for an interview, it lasted, as Deane recalls,for "about half-an-hour or forty-five minutes." Deanebrought along most of the six to eight months of research heand others on Bellamy's staff had accumulated. "I think itkind of blew their minds that we had so much. They said,"Wow, we'll have to schedule a lot of meetings 0 get throughall of this.' That was the last I heard from them."O


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LETfERSGarden ApartmeDts: Who Dunnit?To the Editor:

With reference to your article on Garden Apartments inyour October issue and the captioned accompanying photo-graph, we submit the following:We strongly resent being associated in any way, either byinnuendo or connotation, with the very negative article asthough we are the guilty party. Your writer, photographerand your entire editorial staff have failed in their prudentresponsibilities to obtain the facts and to print the truth.The facts are as follows:1. Cloverdale Estates: Formerly part of Heather Gardens,

known as Section No.5, Cloverdale Estates is bound byCloverdale Boulevard, 67th Avenue, 69th Avenue and 230thStreet, an area which encompasses two square blocks an.which is completely vacant and has been for 'over two years.2. The Developer: Sidney Kalikow Development Corp., atotally responsible organization for over 50 years in Queens,heretofore in apartment houses mainly, is highly respected inthe industry as well as in the community. There has neverbeen any negative involvement anywhere.3. The Site: After years of frustration and false promisesfrom others, the surrounding community will finally see therealization of their hopes. When finished, all the buildings

will be completely rebuilt and will consist of 179 condomin-ium units ranging from one bedroom to three bedroomduplex with playroom and priced for the middle incomepublic.Since all of the above obviously differs from your article,and since all this wiJl clean up an existing eyesore and willincrease property values in the community, we definitely arenot the "bad guys."We therefore expect a retraction of the photograph inconjunction with your article or another article telling how itreally is '. Barney MillmanVice President, OperationsSIDNEY KALIKOW DEVELOPMENT CORP.

19

We regret that our picture of he vacant Cloverdale Estates,also known as Section 5 of Heather Gardens, may havecharacterized all the events described in this article whichfocused on the current plight of many garden apartmentdwellers. But we would like to point out t/lat this two-square .block area once housed some 260familieswho, between 1978and 1979, were removed from their homes in very much thesame way that Sol Gilman is now clearing the CentralGardens complex to make way for the "Villas of ForestHills. " In the last days, in fact, the 500 families remaining inthe other sections ofHeather Gardens formed a human chainagainst the bulldozers to protect the remaining 26 families inSection 5 as well as to protest the manner in which GeraldGuterman was harassing them to leave. Although Millmanclaims "There has never been any negative involvement anywhere" we have to believe that the activities ofKalikow andGuterman .are intertwined. Guterman sold Section.5 to SidneyKalikow in April, 1980, but Iitil(ation is still oendine as fourdifferent mortgagees and mortgagors are involved in theproperty. Also, the remaining Heather Gardens tenants whocomplain of vandalism and the unkempt appearance ofCloverdale Estates also pay rent to Kalikow properties, thereceivor appointed after Guterman filed for bankruptcy andJamaica Savings Bank foreclosed on the occupied sections oj'the complex. Barney Millman, Sidney Kalikow's spokesman,claims no "link" between Sidney Kalikow DevelQpmentCorporation and Guterman, nor any other Kalikow. Whenquestionedfurther about the relationship Millman warned us:" I play hard . . " and insisted we retract any connectioninferred by the picture. We wonder if what he meant by"hard" is similar to the manner in whch the long-vanishedtenants of Section 5 were treated. 0Editors.

Public Housing FocusTo the Editor:Your recent edition of City Limits (October, 1981) whichfocussed on the public housing program in New York City was,by far the most thorough and objective coverage of theprogram .as a whole that I have seen in a long time.Although the articles pointed out some of our many diffi-

culties, the thrust of the issue clearly supported the concept ofpublic housing and specifically endorsed the program in NewYork City.As you know, we are seriously embattled by proposals madeby the Administration to reduce our operating subsidyseverely. Your issue of City.Limits is a timely reminder thatdecent and compassionate social programs such as publichousing should not be capriciously abandoned.Val ColemanDirector of Public InformationNew York City Housing Authority



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THE NEWYORK PUBLIC SERvice Commission, regulator of allmajo r telephone, electric, gas, water andsome rail utilities in the state, has grantedto Con Ed alone, some $1.8 billion inrate increases since 1972. In the last year,Con Ed received a $450 million increaseand was cheerily admonished by a PublicService Commission official for askingtoo little. This is the first of a two partreport on the Public Service Commission; the first will explore the history ofthe PSC, the second part the PSC policyline on rates and service.No other public agency has been soreadily identified with governmentfailure and incompetence. Most NewYorkers would attribute no small shareof venality in the Commission'spersistent leniency toward cash-hungryutilities from Buffalo to Long Island.When the New York Post (with what hasbecome classic Post-style grace)published the home addresses and phonenumbers of the commissioners after theCon Ed increases, hapless ratepayersharrassed the regulators at home forweeks. Democracy in action.

The Public Service Commission wasfounded as part of the movement towardconsolidation within the electric industry, a process which proceeded in fits andstarts during the first decade of thiscentury. Con Ed acquired s m ~ l generating systems throughout the city inneighborhoods like Flushing and Flatbush; such mergers were characteristic ofthe centralization of power production ihurban areas throughout the country. Asthe system expanded, the sudden, unplanned, growth of customers in allclasses contributed a large measure ofdisorder and instability to the fragilenetwork of power lines and plants.Transmission facilities needed to becoordinated, rates needed to be madeuniform and, in general, some type ofgovernmental supervision was necessaryto rationalize an industry in danger ofcollapsing into technological chaos.

A shining gem of blue-chip reform,the National Civic Federation, presenteda sophisticated and articulate alternativeto the hopelessly divided constituency forpublic ownership then emerging as partof a national dialogue regarding the par-

CITY LlMITSlDecember 1981

. IThe Public Service Commission

Which Public?At Whose service?..../

BY RICHARD SCHRADENew York State's Public Service Commission-like thosearound the country-is supposed to be monitor, regulatoand buffer between utilities and the consuming public.But since its inception, argues the author, the PSC hasbeen more lapdog than watchdog. Here's how that relationship began.

ticulars of the developing political economy. The federation stressed theprinciple of tripartite representation oflabor, business and g o v e r ~ m e n t that waslater to become a primary feature ofgovernment boards, commissions andagencies. The federation, by its insistentdenial of class interests, helped mutepolitical voices whose tones bespokeclass conflict. It subsequently cleared theground for harvesting by that segment ofsociety, whose concerns were intimatelybound to the existing set of socialrelations.In 1905, the federation created theCommission on Public Ownership ofPublic Utilities. From 1905-1907, theFederation conducted investigations ofpublic ownership under the direction of

20

Richard Schrader is Director of EnergProject of the New York State WideSenior Action Council.Melville Ingalls, chairman of the BigFour Railroads. A special team ofresearchers were dispatched to Europeand the West Coast to examine firsthand, the effects and the costs of publicpower on municipalities. puring thecollection of this data, Samuel Insull, afounder of the NCF and a secretary toThomas Edison, hardly disinterestedparticipant, went public with his enchanted vision that outlined the mannerin which a public utility could distributethe pleasure of heat and light while notforfeiting an electric opportunity to fillthe coffers Qf power companies fromcoast to coast for generations.The magnate approved of governmenregulation, not clumsy governmentownership. His precise d ign was


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report issued early inby the Commission. Public utlities

ate monopolies, the studyand regulated byte state agency under a

of uniform records and accounts.utility would be assigned a generalr a fixed period of time,

HE COMMISSION'S WORKnarrowed the public power debateic power was nowan adjunct to the costly wel"reformed" free enterprise

em, were buttressed by the

..The 1931 report stated: UThe PSC .. has in effect,surrendered to the power companies the right to chawhatever rates . .. their business and the monopoly otheir enterprise will support. "

underlying principles of the regulating ,structure; the experts appointed to thecommission accepted all the ruts and therhythms of the newly fashioned framework within which utilities would nowoperate. That monopolies should beappropriated a guaranteed annual profitproved an agreeable heresy to the oldeconomic faith of sink-or-swim-capitalism for both regulator and regulatedalike.

In 1907, the Wisconsin and New YorkPublic Service Commissions, after aseason of furious lobbying efforts on thepart of the National Civic Federationand individual bankers and industrialists, began practicing the complex, contradictory ar t of serving both the publicand the utilities. Within months, these

21

two premier agencies and their descendant commissions throughout the countrywere grappling with harshly inadequatetools of their agency charters. In 1907.the New York City government appealedto the PSC for a reduction of the currentrailway rates for streetcars. For fiveyears, the rail company continually appealed the commission's decision to thestate court. Eventually, the SupremeCourt ruled that a regulatory agencycannot decree a rate reduction withoutdue compensation. The private companies had successfully argued tha t if thegovernment agency enforced a ratedecrease, the difference between theoriginal and the decreased rate represented governmental expropriation ofprivate property without due process of



22/28

law. BlIt, if the regulating warriors wereill-equl\>ped to slash rates, they couldsurrender with the sweetest reparations.In those innocent days before thepresent age of overkill, electric companies did not request a rate increasedouble their needs or expectations. Therate hike proposal guaranteed a healthy(sometimes robust) profit and was metfrom inside the regulatory camp by onlythe most delicate and sympathetic challenges. According to a study gatheredtogether by the Home Rule League in1914, from 1907-1914 the Wisconsin PSCgranted 75 percent-l00 percent of theproposed rate increases to utilities in 52of 54 proceedings. T ~ r e were twoattempts at rate reductions, overturned.In 1912, gas rates were raised from $1.00per thousand cubic feet to $1.25 perthousand. By 1910, both the Wisconsinand New York Commissions grantedpower companies a 10 percent rate ofreturn on their investment in plant .andequipment plus a 2 percent depreciationallowance, although the Supreme Cour thad suggested a limit of 5-6 percentprofit on equity. The regulatory agenciespreferred to establish a rate commensurate with the dividends thenaccumulated by the oil industry'Sstockholders.When the commissions held rigorouslyto established precedents, consumerswere pressed to pay grander tribute tothe utilities. When commissions didtinker with previously ordained policy,ratepayers rarely received the benefits sograciously bestowed upon the privatemonopolies. In 1909, 25 large manufacturers petitioned the New York PSC fora substantially decreased rate for water.By 1913, after haggling the new schedulesthrough courts, the PSC unveiled theirmost far-reaching invention, the declining block-rate structure. Under this formula, the customer who consumed themost quantity of water (soon to be gasand electricity) was charged a lower rateper gallon than more timid users. Thescheme became writ in concrete forutility regulators across the land.

B y 1929, TH E COMMISSIONSprovided an almost helpless targetfor politicians out to gather some votesfrom a fickle flock. The New York StateLegislature unleashed ten dozen politicians in search of publicity, to studyCITY LIMITS/December 1981

possible alternatives to utility regulation.A special c o m m i t t ~ was hastily designedto cross;-examine a variety of utilityexecutives on pricing policies. Underquestioning by Frank Walsh, a memberof the committee, Mathew Sloan, theformer President of New York Edison,admittedlthat the holy power of ratereduction was invested in the corporatevessel of the private electric companies.Sloan jovially exclaimed tha t of thetwelve rate deductions from 1914-1929,all were made on the initiative and goodgraces of the Edison Company with no

the extreme economic emergency topublic regulation will have failed ancourse will be had to some system wwill be more responsible to the chaneconomic conditions IUld the publicneed."

Maltbie had responded to the drachanges in the political landscapewrought by the depression. While peverywhere declined 40-50 percent, cost of electricity a c t ~ a l l y rose somepercent in the year of Frankl in D. Rvelt's inauguration. Con Ed was ch

Public power was' now pigeonholedas' a radical,impractical enthusias'm, an adjunct to the costly welfarstate.

pressure at all from the PSC.The Committee's final report sunk afew further harpoons into the flank ofthe writhing whale. "The PSC has beenunwilling or has been obliged to sanctionrates which cannot possibly be justified.It has dodged every vital issue of acontroversial character because of itsfear of court reversal and has in effect,surrendered to the power companies theright to charge whatever rates the conditions of their business and the monopoly of their enterprise will support . "When the commission released astrongly worded minority repQrt and atepidly moderate majority recommendation in 1931, the New York StateLegislature under the leadership ofSenator Warren Thayer, the chairman ofthe Senate Committee on Public Service,consigned both studies to the dustbin ofhistory. Senator Thayer was found laterto have been a beneficiary of theAssociated Gas and Electric Company'slargesse.

In 1933, someone inside the collapsingregulatory house had finally noticed thefalling chunks of plaster. CommissionerMilo Maltbie, an appointee of New YorkGovernor Franklin D. Roosevelt, chairman of the frrst PSC from 1907-1915 anda frequent critic of the electric industry,demanded a substantial renovation ofthe entire neighborhood. "Unless somepractical means is found for morepromptly dealing with rate complaints in

22

ing 3.9 per kilowatt hour , BrooklyEdison 4.5. The climate of easy acescence on the part of the past c o m msions and the utiliti 'arrogant gesin a moment of naticmal calamity, sessed the commissi0ner to unsheasword stronger than .any weapon evseen in the previously tranquil reguwars. Maltbie, in early 1934, ordereacross the board six percent decrearates for every electrical utility in thstate. Con Gas, holding four subsidwithin its corporate womb, scurriedcourt.In 1935, the New York State AppCourt offered further testimony tonotion that Con Ed was a recipientbenign rendering of legal patchworgirded public utility law in the statecour t struck down Maltbie's decreethe six percent decrease, upholding other previous rulings on the mattetightening the rope that bound theCommissioner's hands.Regulation, everywhere, stands othat single tenet. There have been fechallenges either legally or politicalthe arrangement that protects stockholders before consumers or the enment. The Supreme'Court, the regutory agencies, the utilities and thegovernment knew too well the futushape of the Ameriqm economy totamper with such a silccessful formu


23/28

A Landlord ComesBack ,. '

By SUSAN BALDWINAF f E R YEARS OF YOEMAN WORK BY TENANTSand community groups to revitalize a ravaged UpperWest Side neighborhood, a one-time landlord notoriousamong his former tenants has re-emerged, claimjngownership of buildings that were seized by he city over threeyears ago when he failed to pay more than $1 million in backtaxeS.The landlord, Raleigh Davenport, has fIled suit in bothstate and federal courts alleging that he is the true owner of 17city-owned properties, 15 of which are in Manhattan Valley.Davenport has charged that the city took title to them in May,1978, without properly informing him of the foreclosureproceedings. The city, on the other hand, claims that Davenport's charges, which resulted in the New York State SupremeCourt's restoration of title to him for the 17 propert:es inMay, 1981, are invalid because it was never properly served by, Davenport, who won the judgment by default.

And the tenants, in the words of one resident ,andcommunity worker, are in "limbo" because they stand to losetheir homes if the courts fmd that Davenport is in fact thetrue owner of the property. "Nobody gets carried away about having the city a,s thelandlord, but when this happened in May, 1978, the tenantshere were delighted," said Juan ita Nesbit, the founder of thetenants association at 157-161 West 105th Street. "When hewalked away in late 1977 and the city took the property, weimmediately joined the Tenant Interim Lease (TIL)

program," she explained."I don't know who made this mistake. I can't understandhow the city would let this happen," Nesbit argued. "Everyone knows that this man completely destroyed this community because he owned so many buildings and harassed

fit IU i ~ , II I 1 I I I I Iu,' I I ~ '

everyone in each one, . ,H e was a household word-no services, broken boilers, fires ."The matter is presently before a State Supreme CourtJudge who must rule on the city's alleged default and make atechnical determination about Davenport' s filing. Accordingto Andrew Quartner, an attorney with the Debevoise andPlimpton law firm, if the Supreme Court is bound by thisstay, "we will have to get permission from bankruptcy court"to overturn it. .City officials are asking the court to reopen the case on thegrounds that they were never properly serVed to appear at theMay hearing and that the court order returning title to theproperty was granted and signed without its knowledge.

The city's brief also asks that the order be overturned andthat the city be acknowledged as the true owner, and thebuildings be removed from Davenport's statement of assets inhis pending bankruptcy petition.Davenport could not be reached for comment as his telephone was disconnected, but it was learned that he had requested several extensions from the Supreme Court and hadnot fIled his responses to the city's charges. .,, Co-op Bank loan, city investment threatened

I f he court upholds Davenport's case, more than $600,000in repairs and rehabilitation spent by the city will be lost tohim, and a $6 million loan from the National ConsumerCooperative Bank for modera te rehabilitation of sevenhomesteader buildings on Amsterdam Avenue could berevoked:

On August 21, 1981, 'after he had been awarded title to theproperties, Davenpor t, who owes the city some $1.3 million

23 CITY LIMITS/December 1981


24/28

in taxes, fIled papers with the U.S. Bankruptcy Court, listingthe 17 properties as assets. The city was unaware ofDavenport's case until he walked into the Department ofHousing Preservation and Development in mid-Octoberwaiving the court order and claiming title to the properties.Since then , Davenport's re-emergence in Manhattan Valleyhas resulted in a legal nightmare.

"The tenants in the TIL program at 238 West l06th Streetwere ready to buy their apartments, everybody was happy,the papers were ready to sign, and then the title company saidthe city doesn't have the title-Davenport does," saidTheresa Kilbane, of the Urban Homesteading AssistanceBoard and a resident of another Davenport building-212West 105th Street. "W e were all shocked, disillusioned, andnow because of his case, everything, all the work, has come toa halt."Said another neighborhood tenant, Joachim Rosa, of 147West 105th Street, "After two-and-one-half years ofnegotiating with the city for repair money, we had just begunto see the benefits that the Community Management Program can offer . .. I moved here after Davenport during thetransition period when the city had jus t taken the building . . .It was a mess, and it ~ a s in rem, but Davenport was goingaround still trying to collect rent and intimidate people. Hewas taking advantage of their ignorance [of the law] and theirfear." 145-147 West 105th Street are in the Community Management program administered by the Manhattan ValleyDevelopment Corporation.Valerie Asciuto, HPD's general counsel, confirmed that

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work had stopped in all the Davenport buildings, pendresolution ofthe case but asserted, "H e doesn't own thproperty. We have taken that position and are hopefulthe court will see it that way."In response to Davenport's claim that he was never iformed of foreclosure proceedings, Weber, ofcity's corporation counsel's office, said, That's nonseThat issue was dealt with in our papers."Under city law. a landlord with tax arrears has up toyear to repay back taxes. According to ooe insider whoto remain unnamed, the city claims that Davenport camits redemption office on the last day of the mandatory period with an incomplete application and no money. Tpapers were stamped. He said he would come back witmoney but never showed up again until after the discreperiod when he filed a second application and attemptepay back taxes onjust one property. His peti

Documents

City Limits Magazine, December 1981 Issue