Council presses Economic Development Corp. chief on steps to reduce inequality

Economic Development Corporation President Seth Pinsky at the 2010 announcement of the city's waterfront plan. Photo: Azi Paybarah/Flickr

Against the backdrop of a proposed living wage bill that would exempt employees of private tenants in city-sponsored developments, a Council budget hearing yesterday turned into a referendum on the extent to which the nonprofit Economic Development Corporation opens opportunities for lower-income New Yorkers.

EDC is the city’s single largest vendor, with current contracts valued at nearly $1 billion, and seeks to expand the city’s economy through sponsorship of private development projects and support for entrepreneurs.

At the meeting of the Committee on Economic Development, members of the Council’s Progressive Caucus grilled EDC President Seth Pinsky about what they contend is the agency’s failure to adequately address inequality.

“We have not done a good job in providing them jobs,” Councilmember Letitia James of Brooklyn said of constituents who live in public housing, much of it “a stone’s throw” from EDC-sponsored redevelopment projects in downtown Brooklyn. “All this development is around them but there’s none within the public housing.” She announced that she had arrived late to the hearing because of a shooting in her district.

Pinsky said EDC would continue to work with all council members to learn more about their needs and stressed that the agency is working to serve all communities. “We are currently in the process of developing a suite of initiatives that focus on improving income mobility among less fortunate New Yorkers and creating new economic opportunities in neighborhoods that have seen long periods of divestment,” said Pinsky.

In Queens, which Council member Julissa Ferrerras maintained received less investment than other boroughs, Pinksy pointed to big projects like the $209.81 million plan for Willets Point, the $28 million going to new housing at Hunters Point, and $800 million (in private investment) for Flushing Commons. He added that EDC expects the Cornell University-Technion-Israel Institute Campus on Roosevelt Island to bring new businesses to neighboring Long Island City.

EDC, Pinsky informed the council, is also planning to expand its network of business incubator, and launched a pilot initiative last year to help immigrant entrepreneurs found and grow businesses through business assistance programs in their native languages. The agency will also start a new internship program later this year that will pair individuals in underserved communities with private companies, allowing interns to earn credit at community colleges.

But EDC has been less forthcoming about the specifics of how its projects help low-income new Yorkers, asserted Councilmember Brad Lander. “You’re only reporting on job creation and job growth and not speaking to inequality,” said Lander. “You’re not reporting to us in some demonstrable way on shared prosperity, on wage levels, on job quality by sector.”

The hearing comes as the council prepares to consider a living wage measure that would require businesses receiving city subsidies to pay workers at least $10 an hour. In a compromise reached between Council Speaker Christine Quinn and the Bloomberg administration, the measure would exempt tenants, such as retailers, in commercial development projects sponsored by EDC.

“How do we know the commitment to good jobs to helping people grow are fundamentally baked in to the economic models and projects and subsidies that we’re doing rather than assuming that benefits will be shared broadly from economic development?” Lander pressed.

“I respect your opinion,” Pinsky told Lander. “It’s not that you are poorly intentioned but the methodology you’re pursuing to achieve that goal actually destroys jobs, it doesn’t create jobs,” he added, referring to the idea of living wage requirements.

The city gained 71,400 private sector jobs during 2011, which Pinsky said put employment levels at higher than pre-recession levels. Growth was 2.3 percent, slightly better than the national average, and companies like Conde Nast, Google, Tumblr and Facebook made “long term commitments to invest in the city,” said Pinsky. Last week, the Economist magazine ranked New York City as the most competitive urban center on the globe.

“Even if we end up with grand slam home runs we know there’s more to do,” said a diplomatic Pinsky. “So we would like to work with the council members to figure out what more we can do.”

Data Tools


Our work has appeared in…

About TNYW

The New York World focuses on producing data-driven investigative projects.