New York, NY – August 18, 2009 – (RealEstateRama) — Construction of the Second Avenue subway line threatens the survival of a majority of businesses in the area, forcing wage cuts, layoffs and closings, according to a comprehensive survey of business owners released today by Public Advocate Betsy Gotbaum.
Of 59 business owners who responded to the survey, the first of its kind, ninety percent report that their businesses have been negatively affected since construction began in 2007. Yet, virtually none have received support – financial or non-financial – from the city, the state, or the MTA.
Public Advocate Betsy Gotbaum said, “Officials should have been able to anticipate what was obvious to these business owners all along: construction on this scale is more than disruptive, it is devastating. A number of businesses have closed already as a result of construction, and most say they will not survive. They need grants and ongoing support to stay afloat. The city has had 80 years to plan for this, and it will take more than a decade to complete. It’s inexcusable to allow neighborhood establishments to go under because of a government project; and it’s insulting that the city, state, and MTA have failed to communicate with business owners so they know what to expect. We need to help these businesses before it is too late.”
Giuseppe Pecora of the Second Avenue Business Association and Delizia Pizzeria said, “The Second Avenue subway will be great if it is ever completed—but it will be at our expense. Just imagine the impact of construction in front of a storefront or a residence. The sad part of this chaos is that mom and pop stores line the area between 91st and 96th streets. Ten stores have closed, jobs have been lost. Many of us depend on the 3% to 15% profit margin. That, sadly, keeps getting smaller. I think we have the power to make this a great New York story, if all the parties involved work together. We need a team commitment.”
The Public Advocate’s Office surveyed 104 active non-chain businesses in the Second Avenue Construction Corridor (SACC) from July 1, 2009 through August 12, 2009. The majority of these businesses are owner-operated small businesses. 59 owners completed the survey, a fifty-seven percent response rate. Results of the survey include:
• Two-thirds of businesses believe that the Second Avenue subway construction has negatively affected business as much or more than the economic downturn.
• The majority of businesses in the SACC are in danger of closing.
• Nearly half of all businesses in the SACC have been forced to lay off employees; many have had to cut wages, services and products, and/or store hours.
• Virtually none of the businesses have received financial or non-financial support from the MTA or from the city
• None of the businesses have received support from the state
• The majority report that the MTA’s campaign to promote Second Avenue Businesses has been a failure.
• Half of all businesses report that they need grants to help them through until the construction is complete.
The Public Advocate recommends the following:
• The City Should Establish a Second Avenue Subway Construction Mitigation Fund to Provide Emergency Grants to Failing Businesses Located in the Construction Zone
• The City Should Negotiate with Banks to Provide No- or Low-Cost Loans to Second Avenue Businesses
• The City Should Help Second Avenue Business Owners Renegotiate Their Leases
• The City and State Should Provide Property Tax Abatements to Landlords of Second Avenue Subway Construction Corridor Businesses for the Duration of the Project
• The City and State Should Suspend Sales Tax on All Goods and Services Sold by Second Avenue Subway Construction Corridor Businesses for the Duration of the Project.
• The MTA Should Improve Communication with Businesses in the Second Avenue Subway Construction Corridor
• The MTA Should Improve Advertising for Second Avenue Businesses
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Contact: Matt Mittenthal
212.669.4691; 917-597-4485
