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Victory now facing appeal.

A coalition of community groups filed a motion last week to appeal the court ruling giving the go-ahead to several stalled development projects in Manhattan.

Daniel Brodsky's Manahattan West will be immediately affected as will Arcorp Properties'/Arthur Imperatore Convention Center hotel, garage and apartments. A UPS expansion in TriBeCa is still in the development stages and might not be affected yet.

Mitchell S. Bernard, attorney for the National Rerources Defense Council, said the organization served a motion last week asking the New York Court of Appeals for permission to appeal. "It's discretionary and the court will decide whether to hear the appeal," he said. Bernard believes the court will make a decision fairly soon.

Attorney Paul D. Selver of Brown and Wood, zoning and environmental review expert and partner at Brown & Wood, represents the two projects that are affected by the decision. Selver said Daniel Brodsky, the developer of Manhattan West, at West End Avenue and 61 Street, has announced the intention to develop 1,000 housing units under the 80/20 plan, under which 200 units will be reserved for low-income tenants. The Arcorp Properties/Arthur Imperatore Convention Center hotel is an opportunity, Selver said, "to develop a hotel across from the Convention Center and develop a couple of hundred low skill jobs at a time the city is hemorrhaging jobs." The affect of the appeal, he added, is to prevent these projects from moving forward.

One of the principle objectives of the original suit, said Deputy Mayor Barbara J. Fife, was to halt the Trumph City development. The community groups involved in the zoning lawsuit, including People For Westpride and the Municipal Arts society, have since come to terms with Trump and are now backing his new, much smaller plan, Riverside South.

"It's ironic," Selver said, "that the same groups that have joined with Donald Trump to develop the Trump City site with 8 million square feet of luxury housing, have decided to take a step whose only discernable affect is to prevent the development of a low-income housing on the Upper West Side and to prevent the development of an important job generating and economic development facility on the Lower West Side."

Fife said, "One would assume that the purpose behind (the lawsuit) has shifted to opposing the Brodsky project because there in nothing else that will be materially affected by the three-or four-month delay." It's a pity, Fife added, because the Brodsky project involves below market housing which is sorely needed by the city.

Justice Ira Gammerman's original New York State Supreme Court ruling in November 1990, nixed two of the now defunct Board of Estimate zoning amendments and would have required a detailed environmental review by the city, first for the zoning changes, and then for each proposed project. That decision was reversed by a 5-0 vote in the Appellate Division, First Department last month.

"The grounds (for the appeal) are that we think there is a novel legal question of public importance in the case," Bernard said, adding that they believe the First Department's decision conflicts with controlling law.

"There is no issue of principle here," Selver counters. "The Appellate Court decided unanimously that the city made minor technical adjustments to the zoning text and handled the environmental review properly under the circumstances." The decision is consistent with a long life SEQRA (State Environmental Quality Review Act) decisions, Selver added.

Justice Gammerman's originial decision said the zoning text change, which did not require the city to conduct extensive land use reviews, was illegal, Bernard said. The First Department Appellate Division reversed that decision and held that the city compiled with the applicable law in conducting review of the environmental text amendments, he added. "We believe that the city did not and will pursue this in the Court of Appeals," he said.

Fife, said "the lawyers have told us that the decision was clear and did not leave a lot of possibility that it will be reversed." Fife said the lawsuit will buy the community organizations some time. "It's hard to believe the court will find merit in the appeal," the court will find merit in the appeal," she added.

The issue, Fife said is whether every time there is a zoning text change should there be a full environmental review of every possibility. The contention is that the city should review dozens of projects in order to pass a zoning text change, she said. It would be very costly, Fife said, for the city to do this rather than having the individual developer do the environmental review when a specific project is proposed.

Fife said she expects most of the affected developments to go ahead during the appeals process except that the developers could now find their financing halted. "Your don't stop doing something unless your financing halted. "You don't stop doing someting unless your financial institution chooses not to go ahead when an appeal is pending," she said. Unless somebody got a restraining order, nothing but the "real life" issue of money could stop these projects, the Deputy Mayor added.

Selver said whenever a lawsuit that affects a project is pending, it "casts a cloud" over the ability of the owner to get financing. Additionally, he said, no lending institution would close on a construction loan until pending litigation is resolved.
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Title Annotation:zoning case
Author:Weiss, Lois
Publication:Real Estate Weekly
Date:May 22, 1991
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