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STREET SMARTS

Let the (Political) Games Begin

What do you do when the government wants to replace your business with a big swimming pool?
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If you're like me, you prefer to have as little to do with politics as possible. You don't like being hit up for contributions, paying taxes for services you don't receive, or dealing with regulations brought on by someone else's malfeasance. You wish the government would just leave you alone and let you run your business. Unfortunately, few of us have the luxury of staying above politics.

Let me tell you about my current difficulties with the people who run my town, the city of New York. As you may have heard, Mayor Michael Bloomberg and his deputy mayor, Dan Doctoroff, have been working hard to have New York selected as host of the 2012 Summer Olympics. I, too, think it would be good for the city to host the Olympics, provided we don't have to sell our souls to get it. It never occurred to me that the Games might have a direct effect on my business, however, until one day in October 2002, when my partner Sam got a call from a friend. "I see you're taking up archery," the friend said.

"What are you talking about?" Sam asked.

"You don't know?" the friend said. "You'd better check out the Olympics website." We did, and there we found a photograph of the Brooklyn waterfront. Where our warehouses should have been, there was an artist's rendering of the archery range for the 2012 Olympics.

Governments can (and do) take your land for any number of reasons -- to create parks, build roads, store hazardous waste, whatever. Getting bumped for an archery range seemed like a new one. We tried to make light of it. Periodically someone would shout, "Duck! Another arrow!" and the rest of us would cover our heads. But no one thought the prospect of losing our place of business to the Olympics was funny. Sam contacted an Australian friend of his who had played a major role in the 2000 Games in Sydney. The Australian explained that, in any Olympics, there are major sites, which are more or less permanent, and minor sites, which can be moved up to a few months before the opening ceremonies. Archery was a decidedly minor site, and New York hadn't even been selected yet as the American candidate to host the 2012 Games. "You've got plenty of time," he said. "But I'd start making contacts."

That's what we did. We called the office of the executive director of the NYC2012 effort, Jay Kriegel, and said we were thinking about making a donation and would like to meet with him. The rendezvous was arranged, and Sam and I met him and one of his assistants for lunch. "So, what's your interest in the Olympics?" he asked.

"Well," I said, "four weeks ago, we started practicing archery."

Kriegel smiled. "You're the archery range," he said.

"Yes," I said, "and we're on the East River, which can get pretty windy. We think it's not the best place for archery. We also have a business with 350 employees. We'd like you to think about moving to another location."

Kriegel indicated that, as a minor site, it might be possible to find another location for the range, but that no changes would be made for many months. "In the meantime, I'd like to get you involved in what we're doing," he said. "Maybe you'd be willing to make a contribution."

"We'd consider that," I said. "But a week from now, we're going to hear whether New York has been selected to represent the United States. If we gave money now, we'd be paying for old bills. My father taught me, 'Don't pay for old bills. The money has already been spent."

"That's interesting," Kriegel said. "My father taught me the difference between old friends and new friends. Are you familiar with that?"

"I don't think I am," I said.

"Old friends are the ones who are there when you really need them," he said. "New friends are the ones who get onboard when they see you're a winner. Next week, we'll have a lot of new friends, and we'll be grateful for their help, but old friends will count the most."

I thought it was a pretty good pitch. In any case, Sam and I had already decided to give NYC2012 a check for $25,000. "I understand this isn't a quid pro quo," I said, "but we'd really like to have the site changed."

"I'm not making any promises," he said, "but 350 jobs is a powerful argument."

Sure enough, New York got the nod from the U.S. Olympic Committee the following week. Since we were now old friends, we received NYC2012 hats and shirts and invitations to parties. A few months later, Kriegel called and asked Sam and me to lunch. There he said he'd like us to make an additional contribution -- $50,000 over three months. That was a little steep for us, but we agreed to contribute another $30,000 in three payments of $10,000. "We're really concerned about the archery," I said.

"We're not making any changes right now," Kriegel said. "We appreciate your support."

Understand, I didn't think our contribution was buying any special favors or influence. All we'd get, I figured, was access to Kriegel -- but that could prove vital. If the Olympics did take our site, my company would probably have to move out of town. We'd bought our land in Brooklyn when it was dirt cheap. There simply wasn't any other space within the five boroughs that we could afford. Our competitors were in New Jersey, where we'd probably wind up as well. Moving would be a lot of work, but at least my partners and I would be handsomely rewarded for our trouble. The employees wouldn't be so fortunate. Very few would be able to move with us. I believed I had a responsibility to do everything in my power to protect their jobs. Without a direct line to Kriegel, I might never get a chance to argue our case.

In any event, I took Kriegel at his word that no sites would be changed until later in the process. Shortly thereafter, I learned that bicycle racing and badminton had been moved to the Bronx because the owner of the original site in Queens had "other plans" for the location. I immediately called Kriegel to remind him that we had other plans for our location as well. He was apologetic. He said they'd moved those events because they'd found a better site -- for the Olympics' benefit, not the company's. He would keep me informed, and he knew what I wanted. I was still upset, but there wasn't much I could do.

Then came the crushing blow. Last August, the mayor presented the final plan that would be submitted to the International Olympic Committee. He noted that, because of new rules from the international aquatics organization, it had been necessary to find another home for the aquatics center, which initially was to have been built in Queens. The new site was on the waterfront in the Williamsburg section of Brooklyn -- my land. I read about it in the newspaper.

That did it. Not only had the powers that be made the change without warning us, but our minor Olympics site had turned into a major one, rendering it infinitely harder to get the decision reversed. I was beside myself. I felt I had been deceived. I called Kriegel's office, but he was out of town. By then, I'd sent in one of the additional $10,000 contributions I'd promised. Needless to say, I was in no hurry to send the second or the third.

Meanwhile, a battle was heating up on another front that could cost me my land regardless of what happened with the Olympics. In June 2003, the City Planning Commission had submitted a proposal to rezone part of the Brooklyn waterfront. Under the plan, 28 acres in Williamsburg -- including the land on which my business is located -- would be turned into a waterfront park. Other parts of the area would be opened up for high-rise apartment buildings. Although the local community organizations supported rezoning, they were dead set against the city's plan. To begin with, it did not require the developers to include affordable housing. The community also preferred that the park space be spread out along the waterfront rather than clumped together.

In fact, having it in one clump made no sense. The plan would make the park more expensive to develop and maintain, as well as less accessible to local residents. There could be only one excuse for such a design, namely, the Olympics, which would use the park land for the aquatics center and other facilities. And it just so happened that the person overseeing the City Planning Commission was Deputy Mayor Doctoroff, the founder of NYC2012.

So I was faced with an additional dilemma. I supported the community's position and wanted to help my neighbors, but if I took too strong a stand, would I be jeopardizing whatever chance I still had to keep my land and save my employees' jobs? And what if New York didn't get the 2012 Olympics after all? Doctoroff and the mayor were insisting that they had a good shot, but almost no one outside New York agreed. If the Games went elsewhere, how would my chances of keeping my business in Brooklyn be affected? What would happen to the rezoning plan? And why were Doctoroff and Bloomberg pushing so hard for the rezoning and other projects like the new stadium on Manhattan's West Side if they knew in their hearts -- as I thought they must -- that their bid was a long shot?

I realized I had to figure out what was going on before I could decide on my next step. There were some clues. What particularly caught my attention was the mayor's insistence that work on the West Side stadium begin prior to July 6, 2005 -- the day that the International Olympic Committee would announce its choice of the 2012 host city. I couldn't see why. Olympic cities often build their stadiums after getting the nod. Why was it so important that New York start building before?

Perhaps it was important because Bloomberg and Doctoroff understood that their bid for 2012 was likely to fail and they were actually angling to get the Games in 2016 or thereafter. They swore that was not the case. In fact, Doctoroff insisted that if New York didn't win the 2012 bid, it probably wouldn't even try for 2016. He said "a unique series of resources" was available now that wouldn't be around four years hence. By that, I assumed he meant the Brooklyn waterfront and the land for the stadium on the West Side.

But his assertion was absurd. There were plenty of places to put a stadium and an aquatics center -- unless you were so obsessed with doing it your way that you refused to accept any alternative. In that case, putting a stadium in Manhattan and creating a waterfront park in Brooklyn would be top priorities, and it would be important to get your ducks in a row before the July 6 decision because afterward -- if New York wasn't chosen -- all bets would be off. For openers, the mayor was up for reelection in November, and there was a good chance he'd lose.

The more I thought about it, the clearer everything seemed. Bloomberg and Doctoroff weren't really shooting for 2012. Rather, they wanted to lock in certain conditions that would ensure the Olympics came to New York on their terms in 2016 or later. They wanted to be certain, moreover, that the plan would proceed even if the mayor lost. I'm not impugning their motives here. Until it's proven otherwise, I have to believe they really do want to leave a legacy that will benefit the city after they're gone. And who knows? They may be right, though I doubt it.

If the city takes my land, my partners and I stand to gain a huge windfall. But my employees probably will lose their jobs.

In any case, I had to decide how to proceed. There was, I must concede, a financial consideration -- a potential windfall for me and my partners. If my commercial property were rezoned for residential use, its value would go through the roof. Then again, I would do just as well if the city took my land for a park. After all, were it not for the fact that the city wanted to take our land, it all would have been rezoned residential. But I would still have to live with myself afterward and, with that in mind, I wanted to do what was best not just for the business but also for my employees and the community. Unfortunately, those goals were not necessarily compatible. Although I think our giant warehouses are beautiful, I can understand why our neighbors would prefer to have a park or an esplanade or even an aquatics center. Any of those options, however, would be very bad news for most of my employees.

In the end, I decided to speak my mind even though I knew it might create problems for me down the road. When the rezoning plan came before the Brooklyn borough president, I showed up and urged him to reject it because the whole process stank. The plan had been designed to accommodate the mayor's Olympic ambitions with little, if any, regard for the true wants and needs of the communities it would affect. I later made a similar point at a City Council hearing in City Hall.

I also attended to my unfinished business with Jay Kriegel. We finally got together for another lunch, and I opened the meeting by saying, "I want to tell you what I thought when I gave you the money you asked for. I didn't believe it had anything to do with influence. All I expected was that if some decision you made was going to have a big impact on me, you would at least have the courtesy to call and notify me in advance."

"You're absolutely right," Kriegel said. "I should have called. You have every right to be angry. I apologize."

The apology took me by surprise, but I accepted it. "What I'm really mad about," I added, "is that I've been practicing archery all these months and now I've got to start over again with swimming."

Kriegel laughed, and we had a pleasant enough lunch. When I voiced my skepticism about the city's chances in the competition for the 2012 Games, he repeated the party line, insisting that New York would win. At the end of the meal, I gave him the second check for $10,000 and told him he'd get the third installment in a month. It was my way of letting him know I would keep my word even if he didn't. We parted on good terms.

Still, you might wonder why I bothered meeting with Kriegel at all. I could have called him up and told him off, and no one would have blamed me. When I was younger, I might have done exactly that. But I've learned that it does no good to vent your spleen, particularly when dealing with politicians and government officials. It doesn't even make you feel better for very long. Besides, I may need Kriegel's help someday, and he does owe me one, as I think he would agree. In politics, as in business, events can take unexpected turns. Yesterday's adversary can become tomorrow's ally. You never know how a story will end. I certainly don't yet know the conclusion to this one. I just hope I'll be able to protect my business and my employees, who now number 450, when the time comes.

Norm Brodsky is a veteran entrepreneur whose six businesses include a three-time Inc. 500 company. His co-author is editor-at-large Bo Burlingham.

Last updated: Jun 1, 2005

Street Smarts columnist and senior contributing editor NORM BRODSKY is a veteran entrepreneur who has founded and grown six businesses.
@NormBrodsky




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