The Bronx Terminal Market:
NYC Was Cheated in 1972,
Can We Do Better in 2005?

By Henry J. Stern
March 23, 2005

We have learned that there are slow days and fast days in city news.  The disadvantage of the MSM (mainstream media) is that they have to produce a paper every day, whether anything important happens or not.  People want stock market news, sports results, weather reports, crossword puzzles, occasional gambling games in the tabloids, and, most popular, the astrology column to guide them through the day.
 
Bloggers have the advantage of responding to important items and catching up with their e-mail on the more peaceful days.  Today is a busy day, and we want to bring you up to date.
 
'Pay to Play': Jersey Bans Contractors' Contributions
Medicaid: Massachusetts Does It Better and Cheaper

Cynics, pessimists, standpatters and others who say our problems are impossible to solve should take note of progress made in two states on our borders: New Jersey and Massachusetts.  Yes, we also share a land border with Connecticut, Vermont (originally part of New York State) and Pennsylvania, a water border with Rhode Island (between Block I. and Fishers I.), a water border with the Province of Ontario (Niagara River, Lake Ontario and the St. Lawrence River and a land border with the Province of Quebec (the 45th parallel).  This is the sort of thing we learned from maps in public school many years ago.
 
From New Jersey: "CODEY SIGNS BILL TO PUT AN END TO 'PAY TO PLAY' ON STATE BIDS - A measure to bring back accountability and restore public trust in government," today's NY Times, by David Kocienewski, pB5.  The new law "bans campaign contributions by companies that hold or seek large contracts."  An observation:  If they can do it, why can't we?  Can it be that their governor and Legislature have more integrity than ours?  Is the New York State standard of public ethics lower than that of New Jersey?  Ask our legislators why this can't happen here — we will print their responses.
 
From Massachusetts: "MEDICAID BLUES: How NY Lags Mass," today's Post, column by Robert B. Ward, p33.  The point he makes is that Massachusetts, a progressive state, provides all the services New York does at much lower cost.  "It doesn't waste billions on needless hospital capacity, as we do.  Adjusted for population, New York has one-third more hospital beds than Massachusetts.  The average hospital stay is longer here, too."  In his column, Ward makes specific recommendations to the governor and Legislature.

 
Good News: Tuberculosis is Down Sharply

We promised Monday that we would make an effort to find positive stories to bring to your attention.  Muckrakers usually provide a steady diet of malfeasance and incompetence.  We find such reportage to be incomplete in giving a full picture of events.  Today we have a report from Health Department Commissioner Thomas Frieden, M.D. (click "Analysis of the Mayor's Preliminary Budget for 2006 and Financial Plan through 2009").   Tuberculosis is down 73% since the 1992 epidemic, and most victims today are foreign-born, which means that may be where they got the bacillus.

 
City is Planning Redevelopment of Bronx Terminal Market.
Should the Project Be the Subject of Competitive Bidding?
What to Do With Remaining Merchants Who Face Eviction?

Tuesday's Newsday (a rhyme) and today's Village Voice call attention to the deal in which Related Companies will take over the Bronx Terminal Market from the Buntzman family.  The story by Graham Rayman, p19, leads: "The city's deal for the Bronx Terminal Market is loaded with financial plums for a partnership controlled by developer and NYC2012 backer Steven Ross.... The deal was controversial because there was no competitive bidding and because of Ross' friendship with Deputy Mayor Dan Doctoroff..." 
 
The 2860-word Voice article by Tom Robbins, which was featured on the cover of the weekly and begins on p18, recounts the history of the site:

"Back in 1972, a wily operator named David Buntzman managed to win a sweetheart 99-year-lease to run the market, which sits on city-owned property.  The lease awarded by the Lindsay administration after Buntzman delivered a timely five-figure contribution to Lindsay's brief presidential bid.  Buntzman promptly let the market slide into disrepair and decay, milking the merchants for whatever he could get.  The market became mired in endless litigation ..."

These tawdry transactions were exposed nineteen years ago in the Voice by Wayne Barrett.  For the last several years, the city administration has been working on a plan for Steven Ross of Related Companies to buy out Buntzman and create a shopping mall, along with other uses on the site.
 
Although Ross and Deputy Mayor Dan Doctoroff are personally close, very rich men tending to hang together, there is no allegation or evidence of any financial impropriety.  The various sweeteners listed in both articles may have been needed to close the deal.  We have learned that, in the past, overtures were made to both Mortimer Zuckerman and Donald Trump to take over the site, but neither was interested.
 
The problem now is finding a home for the remaining merchants, who have received eviction notices.  They have been offered dispersed sites in the Bronx, but the strength of the market lies in their being adjacent to each other, so bodegas and restaurant operators can shop conveniently.  It would appear that, considering the enormous scope of the project, finding suitable contiguous space for those displaced should not be an unreasonable burden.
 
The issue as to whether bids should have been solicited is more complex.  Ostensibly, the transaction is between Buntzman and Ross, so the city was not directly involved, and therefore competitive bidding was not leagally required.  But in this case, the city is the 800-pound elephant behind the entire development, so the excuse of lack of privity of contract as justifying a sole source contract is somewhat attenuated.  It may be that only Ross was interested in this problematic enterprise, but one cannot know that unless others have had the chance to bid.  The assertion that Doctoroff recused himself entirely from the transaction is also difficult for thinking  people to swallow whole, considering the multiple contacts and protracted negotiations between the parties.  If Doctoroff had nothing to do with it, who, then, was responsible for working out the agreement?  Let Mr. X come forward and explain the deal to the public.
 
In a way, it is gratifying that Doctoroff occupied himself with a matter other than the Olympics and the West Side stadium, with which he has been accused of being obsessed.  Actually, that isn't bad, because obsessives often accomplish tasks of which more balanced individuals are not capable.  Take Robert Moses, my illustrious predecessor, as an example.  Obsessions can be helpful if they serve a public purpose.
 
Nor is it clear that anyone else would have been interested in taking on the Buntzmans, a wily lot who have been taking advantage of the city and the merchants for a generation and a half.  The Buntzmans' lawyer in the 1972 lease was Patrick J. Cunningham, Democratic leader of Bronx County and Democratic state chairman.  His political career declined after he was indicted, which may have been unjust,  but he remained as county leader until he was succeeded by Stanley Friedman.
 
For the record, Cunningham's most recent successors as Bronx county leader are political consultant Roberto Ramirez and Assemblyman Jose Rivera, father of Assemblywoman Naomi Rivera and City Council Majority Leader Joel Rivera.  Cunningham was preceded by the political Moses of his day, Edward J. Flynn, who was a national figure, and his successor, Congressman Charles A. Buckley. (The rhyme "in like Flynn," widely believed to be derived from Boss Flynn, was in fact a reference to Errol Flynn, an actor known for his intense and diverse sexual appetite.  Errol Flynn appears as a minor character in "The Aviator".)
 
Actually, the redevelopment of the market area in the Southwest Bronx will be an economic boon which is long overdue.  The Bronx Terminal Market is as old as I am, as I notice every time I drive by it going northward on the Deegan and see the year inscribed in concrete.  Getting the Buntzmans out is a major achievement which preceding city administrations were unable to do through the courts.  To condemn the lease could have led to a prohibitive judgment against the city.  Nor is there any evidence of financial chicanery, or any offers from other developers who would have made the deal under terms more favorable to the city.
 
But we recently learned from our experience with the West Side stadium how the Jets offer improved after other offers were solicited by the MTA.  It is possible that, if the same procedure is applied to the Bronx Terminal Market, a similar result will be achieved.  And, if no one makes a better offer, we will be back where we were but we will be satisfied that the city did the best it could on behalf of the public.
 
The City of New York entered into an extremely unwise transaction in 1972.  I was there, although it was not within the scope of my agency (Consumer Affairs at the time).  It is total folly to enter into a 99-year lease, because if the lease is not satisfactory to the lessee — Buntzman — he will fold his corporation and walk away from the property.  On the other hand, if the lease is injurious to the city's economic interest, there is no respite and the taxpayers will be stuck with its terms for a century.
 
Now it is quite possible that, for reasons of which we are not aware, it would be impossible,r impractical or illegal to put the site up for competitive bidding, now or previously.  We are not business school graduates, nor have we earned a fortune in real estate development or enhanced the skyline of the city.  We acknowledge that.
 
But we do believe that it would be helpful, in enhancing public understanding of the proposed transaction, if its negotiators would come forward and explain why our proposal for competitive bidding should not not now be entertained.  We can see that, in this complex matter,  it was more desirable and efficient to negotiate with one prospective developer rather than seven  But now that the terms appear to have been ironed out, why not see what other builder would give us to develop this valuable site, with an appropriate but not insurmountable advantage to Related, which has done so much work.

This is 2005.  I hope the city has learned from its experience in 1972, and will not be influenced by those, however well-intentioned, who are not fully committed to economic development on the best possible terms that can be secured for the City of New York through the democratic and capitalist process of free and open competition.  Is that too much to ask?