In 2006, the Bronx Overall Economic Development Corporation agreed to administer a Gateway Center community benefits agreement between The Related Companies and a community coalition – the New Bronx Chamber of Commerce, Hostos Community College and Mount Hope Housing Company.
Three years later, the Gateway Center shopping mall is ready to open and BOEDC has issued a report on the benefits agreement. The lawyer appointed to handle the benefits agreement, Angel Cruz, abandoned BOEDC months ago and accused the borough president-funded corporation of fraud.
BOEDC used funds intended for employment training and development to compensate its own employees, Cruz claimed. Borough President Ruben Diaz Jr. demanded an investigation and, on Tuesday, September 1, exonerated BOEDC.
“Based on the review of [community benefits agreement report], we are satisfied that there was no misappropriation of funds,” spokesman John DeSio said.
BOEDC president Rafael Salaberrios has explained that additional BOEDC staff members were paid to work on the Gateway Center community benefits agreement from time to time. An independent audit found the BOEDC to be operating in a manner consistent with its obligations, the report said.
The report, however, refers only to $175,000 used to engage Project H.I.R.E., a construction skills training course. The report is silent on the rest of the $1.8 million handed by Related to BOEDC for the benefits agreement to date.
The report does offer important details about the way the benefits agreement has been administered, details of great interest as Bronx stakeholders continue to negotiate another community benefits agreement with Related at the Kingsbridge Armory.
The BOEDC Gateway Unit built a database of more than 500 Bronx minority and women-owned businesses. The benefits agreement stipulated that Related award 35 percent of contracts to Bronx businesses and 10 percent to minority and women-owned businesses. It had awarded 39 of 102 contracts to Bronx businesses (38 percent) as of April 2009, and 15 contracts to minority and women-owned businesses (15 percent).
Related awarded janitorial, security and HVAC contracts to Bronx businesses. The BOEDC Gateway Unit has alerted Bronx businesses to other contracts as well. Gateway Center contractors have used 18 Bronx subcontractors; the report didn’t list the total number of subcontractors at the shopping mall
The BOEDC Gateway Unit has monitored particulate emissions and rodents at the construction site; Related has planted 73 street trees. BJ’s Wholesale Food Club offered 2,000 Bronx residents half-price membership cards.
The benefits agreement stipulated that Related set aside 3,500 square feet for a daycare center at 35 percent below the market rate. The BOEDC Gateway Unit has yet to find a daycare center ready to lease. It has found two existing small businesses to retail footage, however: Young World and Marisco Centro.
The benefits agreement stipulated that Related use union labor during construction of the shopping mall, and it did. The agreement also stipulated that unions train south Bronx residents and that Related encourage unions to recruit new members from the south Bronx. The BOEDC Gateway Unit steered 45 students to Project H.I.R.E.; 26 graduated, 19 are union members, only two worked at the Gateway Center construction site.
The BOEDC Gateway Unit assisted more than 1200 people at eight pre-screening employment fairs and helped to coordinate a handful of well-attended employment fairs.
The benefits agreement stipulates that no less than 25 percent of Gateway Center retail positions go to residents of Community District 4, no less than 25 percent to residents of Community Districts 1, 2, 3, 5 and 6, and no less than 25 percent to residents of the Bronx. The report doesn’t break retail positions down by community district; as of July 14, 1020 of the 1961 positions (52 percent) had gone to Bronx residents.
There are still open positions and employment fairs are ongoing. More than 5,000 Bronx residents have registered for positions at the Gateway Center via the BOEDC Gateway Unit, the report said.
Hundreds of Bronx residents were unable to prepare proper resumes and obtain proper clothes to interview but the requirements of the benefits agreement are being met or exceeded, the report said. Of those who interviewed with Target and submitted drug tests, more than half failed the tests.