PortSide NewYork testimony on South Brooklyn Marine Terminal Master Lease between EDC and SBS

EDC photo of south brooklyn marine terminal (sbmt)

EDC photo of south brooklyn marine terminal (sbmt)

Starting in January 2015, the subject of the South Brooklyn Marine Terminal (SBMT) on the Sunset Park waterfront has prompted a lot of consternation - and confusion. The media coverage added more confusion than clarity with stories that were short on information and long on political speculation. 

The media muddle

New York City is the media capital of the nation, and it is also a city where none of the major media, as far as we can tell, has a waterfront reporter.

The reporting on waterfront issues shows signs of that lack, notably in the case of SBMT.  We try to fill some gaps in the story below.  The major media spent little time exploring why the New York City Economic Development Corporation (EDC) sought a long term lease from the NYC Department of Small Business Services (SBS) nor illuminated what the relationship is between those two sectors of New York City's own government vis a vis the waterfront. PortSide has been looking into that and will report back in the future.  For now, below, is what we understand to be the essence of the 2015 SBMT story thus far:

The Real Deal in Question

Map from website from the axis group, the first sbmt operator selected by the edc which went bankrupt.

Map from website from the axis group, the first sbmt operator selected by the edc which went bankrupt.

The New York City Economic Development Corporation (EDC) sought a long term lease from the NYC Department of Small Business Services (SBS). This is the "Master Lease" often referred to, whereby control over the site was moving between one part of City government to another. "Master Lease" here does NOT refer to the EDC's leasing the site to an operator (a private-sector business) in this go-round. A prior lease was made with the Axis Group that was to run car importing on site, but Axis went bankrupt. Their webpage for SBMT was still live as of this May 20, 2015 here

The local Councilperson, in this case Carlos Menchaca of the 38th District, has, via the City Charter, the function of approving or disapproving such a transaction.  

Menchaca did not approve on round one because he felt that SBMT should not be planned singly, that its development should be considered along with other major developments in the area (such as Industry City) and that the multiple EDC sites in Sunset Park (which all tolled amount to an area as large as many neighborhoods) should be considered as a collective, and that the SBMT development should be planned to benefit the adjoining community in some fashion, and that a mechanism or new governing entity for ensuring that should be created.  The latter concern was because, at some sites, the EDC's metric for success has been rent/revenue earned directly by the agency, an economic benefit which does not necessarily advantage the host community of the EDC site.   Menchaca also felt that the EDC had some unfulfilled commitments in the 38th District and said he would withhold approval of an SBMT deal until those commitments were met.  A home for PortSide NewYork was one of the commitments that Menchaca sought and secured.  

The resulting agreement between Menchaca and the EDC is memorialized in a Letter of Intent (LOI).  Thefinalizing of this LOI is what greenlighted the City Council to have another hearing on the SBMT matter, following up on the December hearing, the first. 

A City Council hearing regarding SBMT was held on Tuesday, May 19, 2015.  This was a hearing of the Subcommittee on Landmarks, Public Siting, and Maritime Uses.  To watch the video, look for the link VIDEO on that page.  The LOI between Menchaca and the EDC figured largely in the discussion.  Our President Carolina Salguero testified for PortSide NewYork. We outline our understanding of the contents of the LOI in the Appendix at the end of our testimony.  We copy our testimony in full below, or you download it as a PDF here.

The five council members present voted to approve the Master Lease between EDC and SBS. Other councilmembers were present earlier in the hearing, some commented, some did not.  This will be voted on by the entire City Council at the Stated Meeting scheduled for May 27.

PortSide NewYork testimony about SBMT

Testimony of Carolina Salguero
President, PortSide NewYork
May 19, 2015
Testimony to New York City Council

Re:     NYC Council Subcommittee on Landmarks, Public Siting and Maritime Uses
LU 0224-2015, proposed maritime lease between the New York City Department of Small Business Services (SBS) and the New York City Economic Development Corporation (EDC) for South Brooklyn Marine Terminal (SBMT)

PortSide NewYork understands that the EDC-SBS lease discussion led Councilman Carlos Menchaca to work out a Letter of Intent (LOI) with the EDC that includes many terms beyond the SBS-EDC lease and the SBMT site itself. We summarize our understanding of that LOI in Appendix A, and our comments below reflect that understanding.

We commend all parties who participated in the creation of the LOI: Councilman Carlos Menchaca for his vision, steadfastness and willingness to bring multiple parties to the table of future collaboration; and the EDC for listening, for evolving, and for making a strong staff commitment to the Sunset Park waterfront in their new restructuring.  The Sunset Park waterfront is a regional asset that merits such focus.  We applaud the EDC’s commitment to rethink the way it operates in communities where it has assets.

PortSide NewYork’s Credentials

PortSide NewYork is a living lab for better urban waterways.  PortSide NewYork works to activate NYC’s waterfront, specifically the BLUEspace, the water part of it.  PortSide shows how to combine the working waterfront, public access and community development. We bring the communities afloat (maritime) and ashore closer together for the benefit of both.  We think it is key to state that the word “community” also applies to maritime, a constituency that can only be at the waterfront, not just the residential community ashore. PortSide’s Sandy recovery work won us an award from the White House and honors from the New York State Senate.

New template for waterfront management, development and community relations

The LOI is an exciting road map for the future of Sunset Park and of Brooklyn, and it may prove an example for The City. 

We applaud its commitment to holistic planning that will consider the whole suite of EDC sites in Sunset Park and that will integrate developments inside a site fence with what is outside it.

PortSide applauds the development of a task force to influence the RFP for the SBMT site. We are excited that members of the shoreside community will be joined by maritime experts in this task force to help foster the creation of an RFP that reflects maritime market realities.

NYC’s piers have lain fallow for a long time while the maritime industry, which includes non-profits like ours with historic ships, has strained to grow.  All sectors of the maritime industry have been seeking space. The brownwater sector of tugs and barges; charter, excursion and diner boats; ferries and historic ships seeks space.  The Sunset Park waterfront has also attracted strong interest from the bluewater sector, ocean-going vessels that import and export. In fact, there have been two offers to build a containerport in Sunset Park since 2001: Hanjin, one of the world’s largest shipping companies, offered to build such a port if they could run it, and a European concern proposed an automated port.

Elements of this LOI reflect an exciting return to the spirit of Vision 2020, NYC’s comprehensive waterfront plan, created in 2010, which embraced the waterways and called for activating them for multiple stakeholders.

Maritime activation improves resiliency

The spirit of Vision 2020 was at risk of being drowned by Superstorm Sandy which turned water into a frightening force. The resulting flood of federal dollars for resiliency grew a defense-against-water mentality. Fortunately, there is a corrective as the resiliency planning conversation turns towards economic resiliency, and that conversation should foster activation of the waterfront for water-dependant and water-related uses which will grow economic, educational and cultural activity.  

Given the 9/11 waterborne evacuation of Manhattan (350,000-500,000 people) and the one during the 2003 blackout, plus the 2012 lessons of Sandy, planners should bear in mind that the most resilient pier is one that can host many uses, particularly boats, and that supports various emergency functions of evacuation and supply by water. Activating SBMT is a plus in this regard. 

Activate SBMT to work with other major marine & marine rail developments

The Port Authority is making a large investment in the Cross Harbor Project which has rail float bridges near SBMT and a rail line running to SBMT.  SBMT is a regional marine rail transportation asset that should be developed with Cross Harbor in mind.

Indirect economic benefits of waterfront activation

We applaud the evolution in the EDC’s metric for success. PortSide has long advocated that the maritime industry and waterfront activation can offer substantial indirect benefits to the adjoining inland community.  The LOI is a recipe for achieving such goals thanks to commitments to workforce development, the creation of a RFP task force, the installation of better fendering for the north side of the Brooklyn Army Terminal (BAT) Pier 4 which will allow more maritime activity on site, the aforementioned holistic planning, and funds from the SBMT lease to support local programming.

PortSide NewYork’s role going forward

PortSide looks forward to participating in the promises manifest in the LOI.   

•    One of the LOI terms is a home for PortSide on Pier 11, Atlantic Basin in Red Hook with a three year contract.   We thank Councilman Carlos Menchaca for his role in getting us our first real estate stability after a ten-year search for a home.
•    We would like to return to BAT Pier 4 and help activate the site for programming.
•    PortSide would welcome an opportunity to join the RFP Task Force.  
•    PortSide has ways to grow indirect benefits of maritime activity including ways to make the maritime industry a neighborhood attraction and an educational amenity via PortSide’s “learn our infrastructure” ethos.  
•    PortSide can share our Waterfront Policy Recommendations which further explains the ecosystem of the maritime industry and its needs.  

Appendix A - summary of the loi

PortSide NewYork understands the SBMT LOI to include the following:

  • 39-year Master Lease between SBS and EDC.
  • The EDC commits to restructuring with a new Executive Vice President position focused on Sunset Park assets, coordinating within the EDC and pulling from all departments and operating from an office in Sunset Park. The department will consider the effect of all EDC assets in Sunset Park; those are Brooklyn Army Terminal which includes BAT Pier 4, SBMT, Bush Terminal (the industrial park), the Meat Market and Bush Terminal Park.
  • A mechanism to involve the landside community and maritime experts in the creation of a Sunset Park Waterfront Planning and Jobs Task Force that will shape the structure of the RFP to find an operator for SBMT.

Community amenities

  • A customized workforce development program in Sunset Park created in partnership with local community organizations to connect residents to jobs created through activation of SBMT.
  • Commitment from the City to provide full funding for the design and construction of a southern entrance at Bush Terminal Piers Park 
  • Amenities at BAT Pier 4 consistent with the 197a plan
  • Installation of fendering on the north side of BAT Pier 4 which will allow for more docking of vessels on site
  • A planning process to understand the scope and costs of building an eco-pier and children’s playground at Bush Terminal Park 
  • Space for the docking of PortSide NewYork on Pier 11 in Atlantic Basin, Red Hook.
  • Creation of a dedicated fund, from the leases on South Brooklyn Marine Terminal, to support local programming