Betraying Democracy – City Hall scheming with real estate lobby to create a “Legal Roadblock” to deny justice and the will of the people
In October 2008, Council Member Robert Jackson, as the prime sponsor, introduced the Small
Business Preservation Act (SBPA). This bill was a revised version of a bill first introduced in the City Council in 1986 by then Council Member Ruth Messinger, intro. 914A, called the Binding–Arbitration Commercial Rent Protection Bill. The bill has had several prime and co-sponsors over the years, including, former Council Members Ruth Messinger, Stanley Michels, Ronnie Eldridge, Robert Jackson, Margaret Chin and Guillermo Linares. All the bills have dealt exclusively with establishing guidelines for landlord and tenant negotiations for the commercial lease renewal process. Councilman Jackson made substantial changes to the present bill with the elimination of all formulas established to “trigger” arbitration in the commercial lease renewal process. The bill was in line with today’s contracts calling for Arbitration to resolve disputes, and had no government involvement in the process. The bill was well received by other Council Members,with 32 sponsors added to the bill by June 2009. On June 29, 2009, a hearing on the bill was held before the Council's Small Business Committee.
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At the June 2009 Hearing the bill had opposition from only the Bloomberg Administration and strong support from the Committee Chairman, David Yassky, other attending Council Members, and all the business groups who gave testimony.
Two factors of the hearing were important.
First, the Chairman of the Committee committed to finding a solution to stop the closing of the small businesses and concluded the
Jobs Survival Act was the best solution, and he added his name as sponsor of the bill. The second important outcome of the hearing was that the real estate lobby did not present any legal challenges to the bill. In fact, Sherri Donovan, Esq. ,the attorney who wrote the bill 25 years earlier, and defended it’s legality at several hearings before the Council, and who was responsible for all the changes made to the bill over the years, including the recent changes made to the bill, was present to answer any questions concerning the constitutionality of the bill, . There were neither questions nor comments made on any legal concerns of the bill at this hearing. Nor did any representative of the real estate industry or of the City Council Legislative Division and the Office of the General Counsel give testimony at this hearing, or submit in writing any concerns about the legality of the bill.
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In October, 2009, Council Member Jackson requested a vote out of the Small Business Committee on his bill, Int 0847., which was expected to unanimously pass. At that time, and for the first time, the City Council’s legal department expressed, in private and using only vague language, concerns on the constitutionality of the bill and whether the bill would stand up to a court challenge. These legal unsubstantiated vague concerns would prevent a vote at that time on Councilman Jackson’s Small Business Survival bill.
Coalition attorney Sherri Donovan was asked by Councilman Jackson to write a memorandum in support of the constitutionality of the bill, which she titled, Summary Memorandum in Support of Commercial Rent Protection Legislation, which was submitted to all appropriate legal departments of the City Council. Meetings soon followed with the Speaker’s legal advisors, Councilman Jackson, small business advocate groups and Attorney Donovan to review Ms.Donovan’s supporting case law and the legal arguments on the constitutionality of the bill. At none of the meetings or correspondence with Legal, was the topic of legal case law supporting the Council’s claims discussed or submitted. Legal never once offered specifics on what part of the Jobs Survival Act exactly the Council’s legal had issues with. On November 9, 2009, the Legislative Division and the Office of the General Counsel of the CityCouncil sent a confidential memorandum to Council Member Robert Jackson responding to Ms. Donovan’s legal arguments that the Small Business Preservation Act was fully constitutional. Their legal position on the bill had not changed after reviewing Ms. Donovan’s legal arguments.They viewed the bill as “remains vulnerable to the legal challenges previously identified by Council staff”. They made no attempt to recommend changes in the language of the bill which would address their legal concerns.
Within a week of the legal counsel’s memorandum to Councilman Jackson, Ms. Donovan issued a“Supplemental Memorandum in Support of Commercial Rent Protection Legislation,” which responded with legal case law to each argument made by the Speaker’s legal advisors. There was no response to Ms. Donovan’s Supplemental Memorandum from the City’s Counsel, nor again, were any recommendations for changes in the bill made by the city council’s legal department or legislative division. To this date, the Council’s legal has never responded to Ms. Donovans legal case law reply.
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On November 30, 2009, Councilman Jackson gave notice to move to discharge the Jobs Survival Act from the Council's Small Business Committee.The Small Business Survival Act was denied a vote in the Council's Small Business Committee solely as a result of the legal concerns expressed by the City Council Legislative Division and The Office of the General Counsel, legal concerns never expressed in public hearings or put in writing and presented officially to the Council committee, nor ever made by the powerful real estate lobby. On Dec. 31, 2009, The Small Business Preservation Act died without a vote ever being taken by the Small Business Committee. Even though the entire membership of the committee were sponsors of the bill and the majority of the city council were sponsors of the bill.
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April 14, 2010- Small Business Survival Act, the bills’ new name, Jobs Survival Act, was reintroduced and
assigned to the Small Business Committee. No hearings were ever scheduled due to the Speaker’s Office holding firm on its position that the bill had legal problems, but they refused to make any recommendations to correct them, nor to allow a public hearing on the legal issues, nor to allow the legislators to do their duty and pass legislation and leave legal challenges up to the courts. The Council’s legal had assumed the responsibility of both oversight for council legislation and for the judicial process.On November 12, 2010, in the Veteran’s Memorial Hall at The Bronx County Courthouse, a Legal Review Forum was held on the Jobs Survival Act . A special invitation was sent to the Speaker’s Office giving them all the time necessary to substantiate their challenge against the bill. They refused to attend or to submit written legal case laws. A complete review of the legal history of past similar legislation was undertaken, as well as receiving testimony from legal authorities on commercial property owner and tenant legislation and court decisions, specifically the Ross V Berkeley decision, which was the foundation of the legal challenge against the bill made by the City Council’s Legal departments. On Jan. 6, 2011, The release of the findings of Legal Review Panel on the Small Business Survival Act, NYC Council Bill Int. 0154-2010 " The Small Business Survival Act, as it is presently written, is fully constitutional and legally sound to withstand likely court challenges. The legal assessment of the Small Business Survival Act by the Legislative Division and The Office of the General Counsel, “that the bill is vulnerable to the legal challenges”, is an inaccurate legal assessment of the bill due to an excess reliance upon a deficient evaluation of a single court decision handed down in 1987 in another state, California. No section of the Small Business Survival Act is found to be “vulnerable” enough to rise to the level in a court challenge to cause the bill to be found unconstitutional."
March 2011 to the present- No public hearings of the bill have been allowed in committee, due to the legal position of the Speaker’s Office that the bill has legal concerns.
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Speaker’s Legal department:
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Refused to testify at the public hearing on the Jobs Survial Act June 29, 2009
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Refused to participate in the Legal Review Panel Nov. 12, 2010
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Refused to submit written arguments supporting their legal position against the bill at either Council hearing or Legal Review Panel hearing
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Refused to comment on the Finding of the Legal Review Panel
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Refused to allow a hearing on the legal issues of the bill
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Refused to recommend any changes in the bill which would make the bill more legally sound.
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Refused to respond to Attorney Donovan's case law reveiw supporting the constitutionality of the Jobs Survival Act
December 12, 2012- Small Business Jobs Survival Act
– new name with a new primary sponsor,Council Member Margaret Chin
December 31, 2013 SBJSA dies.
September, 2014 new prime sponsor , Council Member Annabel Palma
The Small Business Jobs Survival Act did not have a hearing on the bill for the entire 6 year City Council term. Even though NYC was losing between 1,000-1200 businesses each month and between 7,000 to 9,000 jobs each month. And the city’s commercial rent market was completely “out of control” with rent gouging and extortion and pure Greed.