I want to thank Gayle Baron and the members of the Long Island City Business Improvement District for this great honor. Thank you Gayle for all you and your staff do to make this community a better place to work, live, shop and enjoy. Thank you to Gary Kessler, Chair of the Business Development Corporation and David Brause, Chair of the LIC BID. I want to express my appreciation to Stuart and Alan Suna of Silvercup Studios for hosting this event.
Long Island City has always been a central business district -- and there are many traditional manufacturers, shop-owners and warehouses here. But increasingly, this has been a place of growth, expansion, renovation and reuse of great old buildings -- think of Silvercup Studios, PS1 and other innovative efforts.
Before the recent economic crisis, employment in Long Island City had risen by roughly 23% over the last decade, from nearly 75,000 to more than 92,000. And while this area certainly is not immune from the economic downturn, and some companies are certainly hurting, by and large the bad economic news hasn't stopped development, expansion and investment in this community.
Long Island City is a place of extraordinary opportunity -- with lower rents than other places and some of the best skyline views in the world, it's an extremely attractive place to do business.
That's why Citibank moved here in 1989 -- building a tower that once seemed like a boldly optimistic act, but now has proven to be ahead of the curve.
It reminds me that once upon a time a developer built an apartment building in Manhattan way uptown at 72nd Street. Back in the 1880s that was a rural backwater. It was so far from the urban center that they called it The Dakota -- Today we recognize it as one of the most desirable places to live in the world, surrounded by some of the most high priced real estate in Manhattan. Long Island City is starting to have that kind of cache -- a great place to live, magnificent views, wonderful restaurants, awe-inspiring museums and an exceptional place to work.
Citibank likes it so much, they built a second tower. The UN Federal Credit Union built its elegant headquarters here and swiftly leased the entire building.
Just last week we learned that the Muppets are leaving Manhattan -- and coming to Long Island City. With Elmo and Cookie Monster here, you know this is a neighborhood you've got to love. Jim Henson Company just signed a 7 year lease for space in the old Standard Motor Building.
And great new buildings are underway -- the Tishman Speyer tower in Queens Plaza.
Silvercup Studios has proposed a grand expansion that will hopefully get underway.
45 new residential buildings have been completed, are under construction or being planned here.
New residents bring new restaurants, stores and new energy to the community. The rezoning of Hunters Point South opens up great possibilities in an underused area. I submitted testimony to the City Council supporting the inclusion of middle and low income housing in the plan. New York's middle class is the heart and soul of our communities. Middle income developments will strengthen the community and create stability.
With all this growth, and all of this business activity, there are some things that have stayed the same -- and not in a good way.
Queens Plaza is the gateway to New York. It should be an elegant, graceful boulevard that links the great borough of Queens with the densely urban metropolis of Manhattan. Instead, it's an undistinguished nightmare of rushing traffic, frightening crossings, and grim streetscapes.
There's no greenery, no street furniture, no amenities.
It's depressing to drive through and dangerous to navigate on foot. Pedestrians take their lives into their own hands when the try to cross the street.
But I've been working with the City to try to change all that -- to bring Queens Plaza into the 21st Century and help make our hopes for what this neighborhood should be into a reality.
Nearly three years ago, I joined with my colleagues in government and Amanda Burden, Chair of the Department of City Planning to announce that the City had obtained all the funding it needs, including $19.05 million from the federal government, to complete the long-awaited renovation of Queens Plaza.
I worked hard to get earmarks in the budget in several successive years specifically for this project. I'm pleased to note that $37 million in federal stimulus funding is also being directed to this project to bring it down to the waterfront. I can't think of a more appropriate use. And the stimulus money brings the total to more than $56 million in federal funds.
This renovation will do more to change the character of this neighborhood than any other government investment in a generation. The private sector has made this neighborhood into one of New York's great business districts. It's time for the public sector to step up and make sure that the traffic flow and amenities match a flourishing residential and business district.
I've been supportive of the Jackson Avenue Beautification Project -- which is already underway. Ultimately Jackson Avenue will have the look and feel of a gracious major boulevard. I understand that the street medians are already helping to transform the street. Residents are praising new cross walks at the intersection of Jackson & 11th St/Pulaski Bridge -- once considered a deathtrap, it now has well-timed streetlight.
We need to move forward with the project that reclaims Queens Plaza as a place people want to be, a place people understand how to move through, and a place that is green. The idea is to bring it down to a human scale -- a place people will be comfortable walking, biking, spending time in.
Architects remind us that the Elevated at Queens Plaza was built when infrastructure was just infrastructure -- if it was large, ugly and imposing, that's just the way it had to be. If it intruded into a community, that was the price of progress. At the time nobody considered the idea of having infrastructure double as public space. Think of the massive projects built by Robert Moses -- Infrastructure intruded into neighborhoods, divided communities, sublimated the needs of people to the needs of transportation. The Queens Plaza project aims to undo that intrusiveness -- to integrate human scale and reclaim forbidding massive constructs by adding greenery.
Earlier this year, I was told that the City has issued an RFP. I'm told the responses came in and a contractor has been selected. But, all of the work that's been done -- the planning, the struggle to get funding, the solicitation of bids for a contractor -- is getting hung up because the city is insisting that the ongoing cost of maintenance be paid by the businesses in this community.
They want the Long Island City BID to shoulder all the costs. There's precedence for that in other neighborhoods -- but none of those neighborhoods are like Long Island City. I boast about how the neighborhood is changing, how much development is happening, how great the possibilities are. But right now, this is a neighborhood that's poised to take off -- but it still has to reach a critical mass.
The yearly maintenance costs are estimated at $300,000 -- that's $230,000 for Queens Plaza and $70,000 for Jackson Boulevard. That would double the BID's budget -- right now the BID's entire budget is $300,000.
I hope there's a way past the impasse - and I know there's a meeting in the coming weeks that hopefully will resolve the situation. But further delay isn't acceptable. The Queens Plaza Roadway Rebuilding Project will benefit this community -- but it will also benefit the entire city. The traffic that rushes through the neighborhood isn't coming here and isn't staying here. It's just passing through.
I'm in favor of public/private partnerships. I know that the businesses represented in this room are happy to pay their fair share, and that offers have been made to contribute. I urge you to do everything you can to help this project get into the ground. The aim of the project is to make this neighborhood more attractive so new businesses and residents will want to settle here.
I know that the leadership of the BID will be meeting with the City in the coming weeks, and I hope that these discussions will prove successful. I am deeply concerned that the City has had all the funding it needs for three years, and yet ground has not yet been broken. There's no reason for the hold-up -- it's time for this project to move forward. And holding it up over the maintenance issue is unreasonable. If Jackson Avenue can move forward, Queens Plaza should move forward too.
I'm hoping wise heads will prevail, and that together EDC, City Planning and the BID will be able to work things out. If not, I and the local elected officials are certainly prepared to demand answers.
One last thing -- I've talked mostly about local matters. I do want to talk for a few moments about the national economic situation.
As Chair of the Joint Economic Committee, I know how close our economy came to complete collapse last fall. The credit markets were frozen -- I'll bet many of you have been scrambling to get loans to keep your businesses going. We all know that businesses need lines of credit to operate and loans to expand. Their customers need loans to purchase goods. Potential apartment buyers need mortgages to buy. Without credit, it's impossible to do business.
So, when the banks stopped lending -- even to their best customers -- Congress had to step in. One of the most important votes I cast last year was for the TARP -- The financial services industry is critical to the health of our nation -- and in New York the FIRE sector (financial, industry, real estate) accounts for approximately 8 percent of the State's workforce but 22 percent of annual earnings. When the FIRE sector is in trouble, we're all in trouble -- it means some of your best customers have fewer dollars to spend, which has a ripple effect throughout the economy. It means that government has lower tax revenue, which means that services are cut.
And yet, it's really hard to convince people whose 401k plans have tanked, that New York bankers needed a handout -- and that's true even in New York. Calls to my office ran heavily against the bailout -- but I truly believe that without it, we'd be facing a tsunami of bank failures.
We didn't do everything right -- and there are many people who argue that there should have been stricter controls on how the money was spent, and a tighter rein on employee compensation, more of an upside for taxpayers. But we did a lot that's right. We saw what happened when we let Lehman Brothers fail. It would have been disastrous to let other institutions collapse. It would have destroyed our economy. I think it was a good investment. A significant proportion of the TARP funds went to New York institutions. Ten banks have already paid back the TARP funds, with interest.
But we have major problems down the road. The commercial real estate time bomb is ticking.
An estimated $400 billion in commercial real estate debt is set to mature this year with another $300 billion due in 2010. If mortgagers are unable to refinance or otherwise pay those large balloon payments, we could expect to see the default rate climb much higher. That in turn translates into potentially crippling bank losses that our recovering financial system may yet be too fragile to withstand, even with recent indicators of some renewed confidence in banks' financial positions.
Securitized credit card debt could create problems similar to the the subprime mortgage debacle, if large numbers of people start defaulting on their credit cards.
I've done my part to help ease the credit card situation by passing a Credit Cardholders' Bill of Rights to level the playing field between credit cardholders and their customers. I got a kiss and a signing pen from President Obama, and the American people got relief from some of the more odious tricks and traps that have gotten them into debt:
By banning most retroactive interest rate hikes on existing balances, we are establishing the principle that 'a contract is a contract'. By giving consumers 45 days advance notice of rate hikes we are allowing the market to function properly and ensuring that consumers have enough time to switch cards or close their account if their interest rate rises to an unacceptable level.
We're starting to see some positive economic news -- but just on Thursday we learned that New York's jobless rate had risen again -- the 9th straight month of job losses. There were 802,400 New Yorkers without a job in May, the largest number since the mid-1970s -- back when New York was facing bankruptcy. Since its peak in August 2008, New York has lost 212,200 private sector jobs, erasing more than half of the jobs added during the State's 2003-2008 economic expansion.
So, I remain cautiously optimistic that we've turned a corner since last fall -- and I believe the economic stimulus bill is helping get people back to work. But we have a long way to go.
When I look around Long Island City, I can't help but be hopeful. It's an area that is growing and changing and it's really an exciting time to be here. Thank you.