Opinion
450100/2018
07-11-2018
In the Matter of the Application of Gladys ORDONEZ, and Nelson A. Henao, Petitioners, v. The CITY OF NEW YORK, Respondent. For a Judgment Pursuant to Article 78 and §§ 3001, 6301 of the Civil Practice Law and Rules. In the Matter of the Application of Lyris Ming, Faith Wilder, and Tenants and Neighbors, Petitioner, v. The City of New York, New York City Council, and Bedford Courts, L.L.C., Respondents. For a Judgment Pursuant to Article 78 and §§ 3001, 6301 of the Civil Practice Law and Rules.
Petitioners: Jennifer L. Levy, Kathleen Ruth Meyers, Legal Aid Society, 199 Water St. FL 3, New York, NY 10038 Respondents: Robert Lee Martin, Chris Reo, Corporation Counsel of the City of New York, 100 Church Street, New York, NY 10007, David Paget, Katherine Ghilain, Sive Paget & Risel, PC (for Bedford Courts in Ming case), 560 Lexington Ave., New York, NY 10022
Petitioners: Jennifer L. Levy, Kathleen Ruth Meyers, Legal Aid Society, 199 Water St. FL 3, New York, NY 10038
Respondents: Robert Lee Martin, Chris Reo, Corporation Counsel of the City of New York, 100 Church Street, New York, NY 10007, David Paget, Katherine Ghilain, Sive Paget & Risel, PC (for Bedford Courts in Ming case), 560 Lexington Ave., New York, NY 10022
Carmen Victoria St. George, J.
In these hybrid proceeding/actions, petitioners seek orders (1) declaring that the challenged Environmental Impact Statements (EIS) are void as arbitrary and capricious; and/or, (2) under CPLR § 3001, a declaration that the City Environmental Quality Review Technical Manual (Technical Manual) is null and void, and thus the two EIS's, which used the formulations suggested in the manual, are also void; and/or, (3) under CPLR § 6301, injunctions which restrain respondents from taking further steps to implement the rezoning plans for the East Harlem Development and Bedford Union Armory projects, (4) staying any development or rezoning of any project until a technical manual is promulgated properly, pursuant to the City Administrative Procedure Act (CAPA); and, (5) granting them costs and disbursements under CPLR § 8101.
Petitioners initiated the Ming proceeding by way of Order to Show Cause for a temporary restraining order. This Court declined to sign the Order to Show Cause, and thus there is no need to consider the papers in Ming that debate the need for interim relief.
Both sets of respondents have answered and opposed the petitions. The parties orally argued this matter on March 29, 2018, and submitted additional materials for this Court's consideration after oral argument. Although the petitions are factually distinguishable, the critical legal challenges in both proceedings are the same. As such, this Court considers them together. After careful consideration, the Court denies and dismisses both petitions.
Statutory and Regulatory Framework
SEQRA and CEQR
The State Environmental Quality Review Act (SEQRA) is codified in Environmental Conservation Law (ECL) §§ 8-0101 through 8-0117. Its purpose is to declare a state policy which will encourage productive and enjoyable harmony between man and his environment; to promote efforts which will prevent or eliminate damage to the environment and enhance human and community resources; and to enrich the understanding of the ecological systems, natural, human and community resources import to the people of the state( ECL § 8-0101 ). The law attempts to balance the goals of economic development and environmental conservation (see generally ECL § 8-0103 ; Spitzer v. Farrell , 100 NY2d 186, 190 [2003] [citing statute] ).
In considering the goal of environmental conservation, SEQRA defines the term "environment" as " ‘the physical conditions which will be affected by a proposed action, including land, air, water, minerals, flora, fauna, noise, objects of historic or aesthetic significance, existing patterns of population concentration, distribution, or growth, and existing community or neighborhood character’ " ( Chinese Staff & Workers Ass'n v. New York , 68 NY2d 359, 365 [1986] [quoting ECL 8-0105 (6) ] [emphasis in original] ). Among other concerns of environmental conservation, therefore, the Environmental Conservation Law stresses the importance of considering "[s]ocial, economic, and environmental factors" before approving any "actions" (id. ). Actions, in turn, are broadly defined to effectuate "SEQRA's salutary purposes" ( City Council v. Town Bd , 3 NY3d 508, 518 [2004] ), and include in pertinent part, as follows:
4. Actions include:
Projects or activities directly undertaken by any agency; or projects or activities supported in whole or part through contracts, ... or other forms of funding assistance from one or more agencies; or projects ... involving the issuance to a person of a lease, permit, ... or other entitlement for use or permission to act by one or more agencies(ECL § 8-01-05 [4] ).
The state-promulgated rules which implement SEQRA and, among other things, "take into account social and economic factors" (ECL § 8-01-13 [1] ), govern the environmental review process (see 6 NYCRR §§ 617.1 - 617.21 ).
There also is a SEQRA handbook which "provides more detail and guidance" for implementing the "law and regulations" (SEQRA Handbook, p 1).
The project sponsor or other designated agency serves as the lead agency. The lead agency prepares an Environment Assessment Form (see 6 NYCRR § 617.6 [1] ) to determine whether the proposed action is a Type I action, which "may have a significant effect on the environment" (ECL § 8-01-09 [2] ). If so, the lead agency may opt to "scope" in order to determine the breadth of the project ( 6 NYCRR § 617.8 ). In addition, the project "must go through a full SEQRA assessment to make sure that it is undertaken in a way that minimizes damage to the environment and public health" (Matter of Friends of P.S. 163, Inc. v. Jewish Home Lifecare , 30 NY3d 416, 424-25 [2017] [Friends of P.S. 163]; see 6 § NYCRR § 617.4). The agency must prepare a draft EIS (DEIS), which includes, as relevant here, an analysis of the long-term and short-term environmental impacts, unavoidable adverse consequences of the project, alternatives to the project, and mitigation measures that will minimize the negative impacts (ECL §§ 8-0104 [6], 8-0109; see Friends of P.S. 163 , 30 NY3d at 425 ). Following the issuance and publication of the DEIS, there is a mandatory public comment period which may include an optional public hearing. After the comment period ends the lead agency prepares, files and publishes both a notice that the process is complete and a full copy of the final EIS ( 6 NYCRR § 617.9 ).
During the review process, it is anticipated and often the case that the project evolves or the surrounding circumstances alter. In such circumstances, SEQRA gives the lead agency the discretion to determine whether changes in the scope of the project, new information, or a change in the underlying circumstances necessitate the issuance of a new SEIS ( Riverkeeper, Inc. v. Planning Board of Town of Southeast , 9 NY3d 219, 231 [2007] [Riverkeeper] [citing 6 NYCRR § 617.9 ] ). The agency must review "the environmental issues ... and must make an independent judgment that they would not create significant environmental impact" ( Green Earth Farms Rockland, LLC v. Town of Haverstraw Planning Board , 153 AD3d 823, 828 [2nd Dept 2017] [citations and internal quotation marks omitted] ). If any of these changes will have a significant adverse environmental impact, the agency must determine whether a supplemental EIS (SEIS) is needed. The agency reaches this decision in reliance on a technical memorandum which assesses the impact of the changes (see Kellner v. City of New York Dept of Sanitation , 107 AD3d 529, 529-30 [1st Dept 2013] ). There is no need for either a hearing or a public comment period in response to the technical memorandum (see Coalition Against Lincoln West, Inc. v. Weinshall , 21 AD3d 215, 223 [1st Dept 2005] [Lincoln West] ).
In addition to the state's review, New York City agencies must comply with the City Environmental Quality Review (CEQR) laws (Rules of the City of New York [RCNY] §§ 5-01—5-11, 6-01—6-15). The scoping procedure that is permissible under SEQRA is mandatory under CEQR (see CEQR § 5-07). The City rules require a draft scope, a public comment period, and a final scope (see id. ). For the most part, however, the SEQRA and CEQR procedures overlap, and the State and City environmental reviews are coordinated (see ECL § 8-01-11 [3] ).
There is no dispute that the East Harlem Development Project and the Bedford Union Armory Project are Type I actions which trigger the need for an environmental impact statement.
CAPA and The Technical Manual
Petitioners also direct the Court to Chapter 45 of the New York City Charter, which contains the City Administrative Procedure Act, or CAPA. CAPA sets forth the mandatory procedure agencies must follow when they issue new rules or amend existing ones (CAPA §§ 1041-43). As is pertinent here, CAPA defines a rule as "the whole or part of any statement or communication of general applicability that (i) implements or applies law or policy" (CAPA § 1041 [5] ). CAPA further states that, among other things, rules "include any statement or communication which prescribes ... (vi) standards for the disposition of public property or property under agency control ..." (CAPA § 1041 [5] [a] ). Excluded from this definition, however, are, inter alia, any "(ii) form, instruction, or statement or communication of general policy, which in itself has no legal effect but is merely explanatory" (CAPA § 1041 [5] [b] [ii] ). As the Court of Appeals has stated, "only a fixed, general principle to be applied by an administrative agency without regard to other facts and circumstances relevant to the regulatory scheme of the statute it administers is subject to" the procedures set forth in CAPA ( Council of City of New York v. Department of Homeless Serv. Of City of New York , 22 NY3d 150, 154 [2013] [Department of Homeless Serv.] [citations and internal quotation marks omitted] ).
Under CAPA § 1042, agencies must provide an annual regulatory agenda which namely provides: a brief description of rules which may be enacted, the rationale for the rule, a description of their contents, and a timetable for its enactment, along with other information. The agency promulgating the rule must publish it in its entirety in the City Record along with a draft statement of the rule's purpose, a notice of a public hearing (if such hearing is to be conducted), and other pertinent information. Finally, CAPA § 1043 sets forth the mandatory procedure which must be followed before the government officially adopts a rule. The fundamental purpose of CAPA is "to inform and gather input from the public on the development and promulgation of the myriad of City agency rules that affect New Yorkers: to provide accountability and openness" ( Callahan v. Carey , (2012 NY Misc LEXIS 758, 2012 NY Slip Op 30400 [U] [Sup Ct, NY County 2012], aff'd , 103 AD3d 464 [1st Dept], aff'd , 22 NY3d 150 [2013] ).
According to petitioners in both cases, chapters 4 - 22 of the technical manual provide mandatory rules for the implementation of CEQR review. Therefore, petitioners argue that the manual is subject to CAPA and the failure to go through the mandated procedure renders the technical manual a nullity. Respondents counter that these chapters merely "provide guidance with respect to methodologies for assessment, identification of significant adverse impacts, and development of mitigation measures for each technical area typically considered in environmental review" (Technical Manual, at p 3-1).
Their debate in the two proceedings focuses on Chapter 5 of the technical manual, which relates to CEQR's socioeconomic analysis and, especially, its suggestions for studying direct and indirect residential displacement. The manual provides a three-step analysis for determining on a preliminary basis whether there is a danger of displacement sufficient to necessitate a more detailed study (id. , at 5-8 to 5-9). In Step 1, the agency evaluates whether the project will increase the higher income population and thus raise the average median income (AMI) in the neighborhood. If so, the lead agency turns to Step Two, in which it determines whether, because of the project, the higher income population will comprise more than 5% of the study area population. "If the population increase is less than 5 % within the study area, or identified subareas, further analysis is not necessary as this change would not be expected to affect real estate market conditions" (id. , at 5-8). If the increase is more than 5%, the agency turns to Step Three. If the neighborhood has already experienced an observable trend toward rising rents and new market rate development, no further analysis is required and there is no need to further study indirect displacement. The manual suggests that if it is unclear whether the trend is a consistent and sustained, "the applicant should consult with the [DCP] on whether a detailed analysis is warranted" (id. ). Further, the manual recommends looking near the study area or, for large projects, within smaller portions of the study area, as a measure to be considered in determining whether the project "could have the potential to accelerate an existing trend" (id. , at 5-9).
DCP is the Department of City Planning, of which the City Planning Commission [CPC] is a part. The parties' papers variously refer to DCP and to CPC when discussing the environmental review activities of the lead agency in Ordonez , and the Court has used their terminology accordingly.
The Petitions
Ordonez v. the City of New York
The documents relating to the East Harlem Rezoning project can be found at https://a002-ceqraccess.nyc.gov/ceqr/ProjectInformation/ProjectDetail/12370-17DCP048M.
The Ordonez proceeding challenges the rezoning and development plan for an approximately 96-block area in East Harlem, bounded by East 104th Street and East 132nd Street on the south and north, and Park Avenue and Second Avenue on the west and east (the East Harlem project. The "reasonable worst-case scenario" for the project includes 69 development sites and adds approximately 3,500 residential units to the neighborhood. In addition, the project proposes to add 151,100 square feet of commercial space, including retail space, a supermarket, one or more restaurants, and office space; 98,900 square feet of space for community facilities, and 132,400 square feet of manufacturing space. There are anticipated decreases of 10,600 square feet of auto-related space, 33,000 square feet attributed to hotels, and 53,800 square feet of warehouse or storage facilities. This work is projected to be completed by 2027, the project analysis year. Under the reasonable worst-case scenario there are 32 potential development sites which are unlikely to be finished until after 2027 (see Notice of Lead Agency Determination, p 2 [Nov. 10, 2016] ).
The petition states that the project area is 95 blocks, but this estimate was changed to 96 blocks by the time of the Final Scope of Work statement.
In evaluating the potential environmental impact, agencies generally consider the "reasonable worst-case scenario," with the maximum development and negative environmental impact.
With the potential addition of 3,500 residential units by 2027, the East Harlem project would increase the number of apartments in the area far more than the 200-unit threshold which, according to the technical manual, triggers full environment review. The East Harlem project also triggered the application of the Uniform Land Use Review Procedure (ULURP), and thus the community board and borough president provided recommendations to the City Planning Commission (CPC) and City Council. In addition, the action purportedly incorporates recommendations from the East Harlem Neighborhood Plan (EHNP) as well as from "Community Board 11, the Steering Committee [which produced the EHNP], DCP's interagency partners, and local elected officials" (FEIS, Executive Summary, at p S-1).
Section 374 of the City Charter sets forth the procedures that must be followed when the city approves a concession, a grant for private use of city-owned property in exchange for consideration exceeding the city's administrative costs. The governing rules are in Chapter 7 of RCNY (RCNY 7-01—7-10). The petitioners do not assert causes of action under ULURP, but criticize respondents' failure to take heed of the recommendations of the community board and borough president.
Petitioners Glady Ordonez and Nelson A. Henao reside in a rent-stabilized building located at 1662 Park Avenue, in apartments 2N and 3S, respectively. The building is located within the neighborhood study area which the lead agency used in conducting its environmental review. Petitioners Ordonez and Henao have submitted affidavits in support of the petition detailing their treatment at the hands of their landlord. They cite the gentrification of the neighborhood through, inter alia, the proposed East Harlem Development Project and the increased rents which go along with such development as the reasons the landlord wants them out of the building.
The Department of City Planning (DCP) was the lead agency for the East Harlem project (see DPC, Notice of Lead Agency Determination and Review, Nov. 10, 2016), and it worked in conjunction with the Department of Housing Preservation and Development (HPD). Along with its notice of lead agency determination and review, DCP annexed a completed Environmental Assessment Statement (NYC City Environmental Quality Review Environmental Assessment Statement Full Form [EAS] ). Among other things, the EAS form requires a technical analysis concerning the East Harlem project's impacts "based on the thresholds and criteria presented in the CEQR Technical Manual" (id. , at p 6). As lead agency, DCP was directed to "provide additional analyses ... based on guidance in the CEQR Technical Manual to determine whether the potential for significant impacts exists" (id. ). Because there was the potential for significant impact here, DCP had to undertake further review and prepare a DEIS.
DCP issued a notice of completion of the DEIS on April 21, 2017. Both here and in Ming , petitioners focus on the portion of the CEQR analysis which relies on Chapter 5 of the manual and examines socioeconomic conditions and residential displacement. Chapter 3 of the DEIS, which contains this analysis, refers to the guidelines in the Chapter 5, which recommend that the lead agency examine five potential socioeconomic impacts, including indirect residential displacement (DEIS, p 3-1). It also cites the "thresholds for analysis" by which the lead agency "typically" may measure displacement (id. ). Among other things, the introduction cites the technical manual for the proposition that "residential development of 200 units or less or commercial development of 200,000 square feet or less would typically not result in significant socioeconomic impacts and would not trigger the need for indirect residential ... analyses" (id. ). It indicates that indirect displacement would be reviewed because of the size of the commercial development.
In general, if a project is likely to have a significant impact, more detailed analysis is required. In describing the components of a more detailed analysis of indirect displacement, the manual focuses on "the population living within the unprotected units" (Technical Manual, at 5-13) —units that are not protected by rent-stabilization, rent-control, or subsidized housing laws, or that are not publicly owned. The manual identifies those who rent these unprotected units as the "population at risk" (id. , at 5-16). The manual also directs the agency to compare the risk of indirect displacement if the project does not go forward with the risk that would exist if the project is approved.
The DEIS initially determined that there would be no significant residential displacement in the neighborhood as the result of the East Harlem project. Direct displacement, it stated, would impact only 11 apartments, and a total of 27 residents. "Indirect (or secondary) displacement is defined by CEQR as the involuntary displacement of residents ... that results from a change in socioeconomic conditions created by a proposed action" (id. , p 3-5). Here, the DEIS stated, although the development "could add new population with a higher average household income as compared with existing study area households, there is already a readily observable trend toward higher incomes and new market-rate residential development in the study area" (id. , p 3-3). Thus, there would not be an appreciable increase in this preexisting trend. The DEIS further indicated that the introduction of affordable housing through this development would serve as a balance against this trend and help maintain socioeconomic diversity in the neighborhood.
The DEIS was not met with universal approval. In fact, Community Board 11 held two days of hearings, on May 16, 2017 and June 20, 2017, following which they voted to disapprove of the application. By letter dated June 26, 2017, Community Board 11 stated that while the "proposal does rezone the community with the goal of developing affordable housing and economic stimulation, it does not preserve the existing character of the neighborhood." It recommended that "all future rezoning plans should be done in conjunction with each other to ensure that 50 % of the new housing on private rezoned and public sites is affordable to a variety of low and moderate income levels. The community board specifically recommended that 100 % of the units on public sites be made permanently affordable, and that 20 % of the affordable units be set aside for those who earned a maximum of 30 % of the area median income. The letter additionally stated that "it is not sufficient to simply build new affordable housing and lose existing affordable housing; instead, NYC must commit to increasing efforts to preserve the existing affordable housing" and must make sure that affordable units are "actually affordable to the current residents of East Harlem" (id. ).
The community board also addresses other areas of concern, and asks that DCP make 25 specified changes to the proposal.
On August 2, 2017, after a July 13, 2017 public hearing before her, Manhattan Borough President Gale A. Brewer also recommended rejection of the plan. She stated that she supported the rezoning plan but not the ULURP application. As is relevant here, she determined that the proposed preservation effort was insufficient to prevent the loss of the affordable housing currently available. Moreover, she concluded, it did not appear that the new affordable housing would be affordable to neighborhood residents who earned less than 30 % of the AMI. She noted that there had been changes in response to the community board's concerns and she disagreed with the proposal in significant ways.
The City Planning Commission (CPC) held a public hearing on the DEIS on August 23, 2017 simultaneously with the ULURP review. According to the petitioner in Ordonez , almost two-thirds of those who commented at the hearing opposed the application. CPC accepted public comments on the East Harlem project until September 5, 2017 and provided responses to the comments (FEIS, Ch 27, pp 27-1 to 27-213). On September 19, 2017, DCP issued a notice of completion of the FEIS and the FEIS. Moreover, as the FEIS incorporated responses to some of the comments DPC received at the hearing and during the public comment period, DPC generated a second technical memorandum. Among other things, the changes included height limits to the buildings in certain portions of the East Harlem project area. The memorandum concluded that the potential modification would not change or add to the potential for adverse environmental impact and it would not affect the reasonable worst-case development scenario which the lead agency already had studied.
Prior to the public hearing on the DEIS, the DCP issued its first technical memorandum, which addressed the establishment of height limits to buildings in certain portions of the proposed districts. DCP proposed these restrictions in response to public comments it had received. These new proposals updated the changes described in the first technical memorandum.
CPC submitted the FEIS on October 2, 2017. In its accompanying lead agency report, it indicated that HPD had drafted a housing plan for the community in response to concerns related to the affordability of housing as well as housing preservation. According to CPC, the plan contained "proposals to identify distressed buildings, [and] offer technical assistance to property owners and provide free legal services to tenants," and it "explore[d] new ways to preserve the existing affordable housing stock, such as piloting a community land trust program and studying the feasibility of a Certificate of No Harassment program" (Lead Agency Report, at p 15). HPD stated that it would develop more than 2,000 additional affordable apartments, including — "where feasible" — units with "deeper levels of affordability" when they are on publicly owned sites (id. ).
The FEIS evaluated the need for mitigation of any adverse impact relating to indirect displacement. It stated that because "the Proposed Actions would result in residential development [exceeding] 200 units ... assessments of indirect residential ... displacement [is] warranted" (FEIS, at 3-1). The study's preliminary evaluation determined that there would not be a significant adverse impact, however. Although "the residents of the affordable and market-rate units resulting from the Proposed Action could have an average household income that would be above the average household income of the existing study area populations," the neighborhood already had "a readily observable trend toward higher incomes and new market-rate residential development in the study area" (id. , at 3-3). CPC also based this decision on the fact that Mandatory Inclusionary Housing would have a positive impact on affordability and income diversity; without the East Harlem project and the concomitant mandatory inclusionary housing, the study concluded, the development of affordable housing would be unlikely and the impact on vulnerable residents would be harsher (see FEIS, at p 3-22).
Under Mandatory Inclusionary Housing, any new housing which is subject to approval through land use actions must set aside affordable housing units in the building. CPC and the City Council have the discretion to select the affordable housing set-aside from one of several formulas.
A third technical memorandum, dated November 28, 2017, examined additional proposed changes to the East Harlem project. Among other changes, there were modifications to the proposed district boundaries and additional limitations on the height, density, and minimum nonresidential floor area. The memorandum concluded that there would be no added adverse impacts due to the modifications to the proposal. The memorandum stated that the amount of direct displacement would be the same "because the number and location of projected development sites would not change" (Nov. 28, 2017 Technical Memorandum, at p 11). The memorandum concluded the modifications "would not result in significant adverse impacts on indirect residential displacement" (id. ). The memorandum noted that although there would be 2,682 new dwelling units, compared to 3,488 in the existing plan, the percentage of new affordable housing units would remain the same. "[W]ith a slightly smaller population increment and the same overall average income," the memorandum found, "the new residential population ... would have slightly less potential to alter the demographics of the study area population" (id. ). Moreover, the memorandum stated, "there is already a readily observable trend toward higher incomes and new market rate residential development in the study area ... without the [East Harlem project]" and the proposed changes "would not introduce or accelerate the existing trend" but instead "would introduce a greater proportion of affordable [dwelling units] compared to the No Action Condition" (id. ). The East Harlem rezoning plan was approved on November 30, 2017. The City Council exercised its discretion and selected the following mandatory inclusionary housing options: 1) a set-aside of 25% of the new apartments constructed — 15% to residents with 60% of the area median income, and 10% to residents at 40% of the area median income, and 3) a set-aside of 20% of the new units for residents with 40% of the area median income.
Following the East Harlem project's approval, the Ordonez petitioners commenced this proceeding, which is currently before the Court.
The materials relating to the Bedford Union Armory project can be found at https://a002-ceqraccess.nyc.gov/ceqr/ProjectInformation/ProjectDetail/11754-16DME005K.
The other proceeding before this Court is Ming v. City of New York (Ming). Petitioner Lyris Ming has resided in apartment 6A at 410 Eastern Parkway for over 45 years as a rent-stabilized tenant. Petitioner Faith Wilder has been a rent-stabilized tenant in apartment 6C of the same building for a similar period. Both individuals have submitted affidavits in support of the petition. Petitioner Tenants and Neighbors (T & N), which is based in Manhattan, organizes tenants to oppose actions which they believe directly and negatively impact their rights as residents, and as relevant here, it has worked with tenants who live within 400 feet of the Bedford Union Armory and who oppose the rezoning. Respondent City of New York (City) promulgates environmental regulations, and the New York City Council (City Council) is empowered to approve or disapprove the development that is planned for the Bedford Union Armory (the Armory).
The Armory is located at 1579 Bedford Avenue in Crown Heights, Brooklyn. It occupies almost a full city block, around 2.8 acres. It was constructed in the early Twentieth Century for use by Cavalry Troop C. Its size enabled the entire squadron to engage in mounted drills. After 1911, other Cavalry squadrons and troops used the Armory during various periods. In addition to the space for cavalry exercises, the space included a head house, stables, and a garage. The building has been designated as a New York City Landmark and it also is listed on the National Registers of Historic Places.
In 2011, the building was decommissioned for military use and respondent the City of New York (the City) took over the site. The building remained vacant except for occasional use by civic organizations and movie productions. On November 7, 2013, the New York City Economic Development Corporation issued a request for proposals for a plan to redevelop the Armory (the Armory project). Just over two years later, in December 2015, the Economic Development Corporation selected respondent Bedford Courts LLC (Bedford Courts) for the the Armory project. The central part of the armory, the Armory-Head House and Drill Shed, would be developed into a community event space and a recreational center, along with some commercial office space. The former stables, in the southern part of the armory site, would be demolished and replaced with a seven-story condominium building. Finally, the garage, on the eastern part of the armory site, would be demolished and replaced with a sixteen-story mixed-income residential rental building.
In 2016, Bedford Courts submitted a rezoning application relating to the Armory. The application "proposes the disposition of public land to [Bedford Courts], zoning map changes and special permits to facilitate the proposed 542,393 gross square feet, three-building mixed-use development which includes 390 residential dwelling units," approximately 177 of which are affordable housing units (Final Scope of Work, at p 2). In letters to the New York City Department of Citywide Administrative Services, the New York City Department of City Planning, the New York City Housing Development Corporation, and the New York City Department of Housing Preservation and Development, all dated December 1, 2016, the City's Office of the Deputy Mayor for Housing and Economic Development (OMHED) announced that it had assumed the role of lead agency and would evaluate the environmental impact and the disposition of land involved in the the Armory project.
On December 23, 2016, OMHED issued an EAS, which provided an initial analysis of the potential environmental impacts of the proposed action. The EAS noted that the action was subject to environmental review under the State Environmental Quality Review Act (SEQRA) and City Environmental Quality Review (CEQR). Furthermore, because the land in question is City property, ULURP applied, and thus the Community Board and the Borough President provided recommendations for the Armory project before final voting took place.
The EAS also noted that Bedford Courts requested the zoning amendments because of the Armory's location in an R6 residential rezoning district, as well as an amendment to require mandatory inclusionary housing at the site. The EAS suggested that dwelling units be set aside as follows, creating a weighted average of 76% of the AMI: a) 13,594 square feet to residents earning up to 40% of the AMI; b) 40,781 square feet to residents who earned up to 50% of the AMI; and c) 46,745 square feet to residents earning up to 110% of the AMI. Bedford Courts requested a special permit for a large-scale general development and a special permit to reduce accessory residential off-street parking.
On February 3, 2017, OMHED issued a Positive Declaration which concluded that both scoping and an EIS were necessary because "the proposed project may have a significant impact on the quality of the human environment" (Positive Declaration, Martin Aff. in Support of City Respondents' Answer, Exhibit C, at pp 2-3). Among other things, the Declaration stated there was a potential for significant adverse impacts on socioeconomic conditions. The Declaration further specified that because "the Proposed Actions would result in a net increment of more than 200 new residential units, an assessment of indirect residential displacement will be performed" (id. , at p 3).
This constituted a revision of its original positive declaration, dated December 23, 2016.
On May 17, 2017, OMHED issued a DEIS. Pursuant to CEQR, a public hearing procedure commenced, conducted simultaneously with the ULURP review. The DEIS study area consisted of a .25-mile circle surrounding the Armory site — which, according to petitioners, "was unnaturally elongated so that its boundaries were commensurate with census tracts" (Ming Petition, ¶ 33). An assessment of potential socioeconomic conditions is contained in chapter three of the DEIS. The chapter assessed the potential indirect displacement of area residents. The analysis noted that indirect residential displacement can occur if a proposed action will increase the property value in the surrounding area, resulting in increased rents unaffordable to the area's most vulnerable residents. It determined that indirect residential displacement would not be a problem.
Because the building was previously vacant, all the proposed residences are new. Therefore, there was no need for a study of direct displacement (DEIS, at p 3-1).
By this point, the proposed number of new residential dwelling units had increased from 370 to 415, 60 of which were condominiums. The number of affordable housing rental units to be set aside had increased by 1, to 178, and they were to be set aside for households earning 40% to 110% of the AMI. In addition, 12 of the 60 condominium units were to be set aside to households earning up to 120% of the AMI. The DEIS estimated that around 495 additional dwelling units would be added to the area by 2020, only 6.7% of which would be affordable housing.
The breakdown was: 178 affordable housing units, 176 market rate units, and 1 super's unit.
In determining whether displacement would occur, the DEIS used the threshold number — 5% — the percentage which is suggested in the technical manual. The DEIS concluded that because "the socioeconomic study area population would increase by less than 5%" (DEIS, at p 3-2), no further analysis was required. Nevertheless, it conducted "further study of the socioeconomic conditions in the socioeconomic study area" and concluded the development would not have a negative impact, particularly noting that the development would introduce only 4% of the total number of apartments projected to be added by 2020 (DEIS, at p 3-13; see also DEIS, at p 3-2 [stating that the influx of dwelling units would not introduce or accelerate "trend[s] that may potentially displace a vulnerable population to the extent that the socioeconomic character of the neighborhood would change"] ).
Community Board 9 held a hearing on June 19, 2017 at which it considered the ULURP application. Following the meeting the board recommended not supporting the Armory project. It memorialized its recommendation in a letter dated August 11, 2017. The letter set forth the board's desire that the armory function as a quasi-town square which focuses on the community's needs and also attracts people who live in nearby neighborhoods. Among other things, the letter suggested removing the housing component from the armory altogether and replacing it with a "commercial corridor" suitable to the community's needs, and setting aside space for organizations that support seniors and at-risk youth. It added that although it did not want housing in the area, if respondents found it necessary to include housing, it should be 100% affordable. It also stated that the building should be landmarked.
The board revised the letter but simply to the extent of clarifying that the vote was to disapprove of the Armory project, not to disapprove with modifications or recommendations.
The Brooklyn Borough President held a public hearing about the ULURP application on July 10, 2017, after which he considered written testimony on the subject. On September 1, 2017, he recommended that the application be disapproved with conditions. He noted that the community board disapproved the application and requested a revised plan which better served the local community and area businesses by increasing the commercial and recreational parts of the proposal, making all the housing units affordable, with no market-rate housing, and including more Armory programs for seniors and youth. Among other things, he recommended replacing the condominiums with affordable housing, maintaining appropriate building heights, improving pedestrian safety, and, with respect to the Armory project's energy use, incorporating environmentally sound policies. He further suggested changes to Section 9 NYCRR 2524.5 of the rent stabilization code, which currently allows owners to withdraw rent-regulated buildings from the rental market on several grounds, so as to remove the provision allowing them to do so in order to demolish their rental buildings; and, he suggested that the state legislature limit the future rent increases allowable when a landlord gives a tenant a preferential rent.
The lead agency hearing took place on September 19, 2017, and received written comments on the DEIS until September 29th. Petitioners point out that there were many negative statements about the Armory project. Among them, community members and community organizations worried that the dearth of more "deeply affordable" housing units would render even the mandatory inclusionary housing units unaffordable to many Crown Heights residents, that tenants in rent-regulated apartments would be vulnerable to displacement and harassment, and that homelessness would increase. Petitioners contend that, despite these concerns, respondents reflexively applied the CEQR Manual and did not consider whether rent-regulated tenants were vulnerable to displacement. CPC approved the proposal on October 30, 2017, and according to petitioners it disregarded "the concerns raised by the Community Board, the Borough President, and the community" (Ming Petition, at ¶ 40).
On November 21, 2017, the related City Council subcommittee approved the Armory project with modifications which increased the affordability levels of the apartments. As currently conceived the development will include a recreation center, a community event space, and offices for non-profit organizations. The plan no longer includes luxury condominiums. Instead, the Armory will include 415 units of mixed-income housing, 250 units of which will be designated to low-income individuals and families with incomes that are below 60 % of the area median income (AMI), broken down as follows:
50 apartments will be offered to individuals and families who earn 30 % of the AMI. 25 of these will be set aside for the formerly homeless.
24 apartments will be offered to those earning 40 % of the AMI.
24 apartments will be offered to those earning 50 % of the AMI.
152 apartments will be offered to those earning 60 % of the AMI.
An earlier plan had included 115 affordable rentals, 150 rentals not subject to income restrictions, and 60 luxury condominiums.
In addition, a minimum of half of the recreation center's memberships will be discounted for area residents.
On November 28, 2017, two days before the full council's vote was to occur, petitioners commenced this proceeding. The Ming petition asserts the following claims: 1) the FEIS arbitrarily failed to assess the potential for indirect residential displacement of rent-regulated tenants, concluding such study was unnecessary in reliance on the technical manual's population growth cut-off of 5%, and on an artificially inflated study area and population, and 2) the technical manual "consists of rules not properly promulgated pursuant to [CAPA]" (Ming Petition, ¶ 58) and therefore the manual should be deemed null and void. As relief, they request a) an injunction preventing respondents from taking further action on the Armory project, b) a determination that the October 30, 2017 FEIS is null and void under article 78, c) a declaration, under CPLR 3001, that the technical manual is null and void because it was not promulgated under CAPA, and d) a stay of all rezoning projects that were approved in reliance on the technical manual pending its compliance with CAPA.
Arguments Relating to CAPA: Common to Both Petitions
As petitioners point out, CEQR mandates environmental review of Type I actions, but does not set forth the standards for determining whether the actions have a significant adverse impact on the environment in the mandatory categories of consideration. The City has published and periodically revised a City Environmental Quality Review Technical Manual (technical manual), which provides guidelines for the environmental analysis (See Chinese Staff and Workers Association v. Burden , 88 AD3d 425, 429-30 [1st Dept 2011] [Chinese Staff] [Technical Manual contains the "accepted methodology"], aff'd , 19 NY3d 922 [2012] ). The manual, as updated in 2014, states that it "should be used as guidance for any environmental review" (Technical Manual, at Introduction-2). Courts have found that the manual provides an "accepted methodology" ( Chinese Staff , 88 AD3d at 429-30 ; see Friends of P.S., Inc. v. Jewish Home Lifecare , 146 AD3d 576, 579 [1st Dept], aff'd , 30 NY3d 416 [2017], reargument denied , 31 NY3d 929 [2018] ).
Petitioners argue that the rigid policies in the technical manual, which respondents apply "without regard to individualized circumstances or mitigating factors ... [fall] plainly within the definition of a ‘rule’ " (Petitioners' Mem of Law, at p 22 [quoting Department of Homeless Serv. , 22 NY3d at 154 ] ). They state that the manual implements and applies SEQRA and thus it falls squarely within the definition of a rule in New York City Charter § 1043 (a). They note that in New York State Restaurants Ass'n v. New York City Dep't of Health & Mental Hygiene (5 Misc 3d 1009 (A), 2004 NY Slip Op 51290 [U] [Sup Ct, NY County 2004] ), the court found that a booklet which prescribed a mandatory scoring method for food service inspectors, reclassified some existing violations, and eliminated some violation categories — set forth rules and therefore was subject to the requirements of CAPA.
Furthermore, petitioners state that in virtually all CEQR applications, the city has applied the manual without deviation and has found no significant environmental impact (Meyers Aff, Jan. 18, 2018, at ¶ 8). Petitioners submit a chart which purports to demonstrate this rigid adherence to the manual (id. ). They state that 29 CEQR reviews have occurred since 2014, and not one of them has found a significant environmental impact due to direct or to indirect displacement. They contend that, based on the above, the manual constitutes a rule. Citing Ousmane v. City of New York (7 Misc 3d 1016 [A], 2005 NY Slip Op 50734 [U] [Sup Ct, NY County 2005] ), they contend that respondents impermissibly seek to circumvent the requirements of CAPA by labelling the "rule" as a "manual." They further argue that ECL 8-0113 (1) mandates the promulgation of rules and regulations and that, accordingly, the New York Codes Rules and Regulations contain rules implementing SEQRA. For these reasons as well, petitioners contend, respondents should have treated the manual as a rule. They state that the City has acknowledged it routinely uses the manual as a guide when its agencies conduct environmental reviews, and this constitutes a concession that the manual has the force of law.
Renae Widdison, who obtained a post-graduate degree in city and regional planning and published her thesis on the technical manual, also has submitted an affidavit in support of petitioners' position herein. Widdison attests that the technical manual's suggested analysis of the risk of indirect displacement is flawed. She cites two respects in which the analysis allegedly is deficient. First, it does not consider that gentrification already causes indirect displacement. Second, because it focuses on unregulated apartments, it excludes vulnerable rent-regulated tenants from the study. She asserts that the EAS erred in concluding that there is not a significant risk of indirect displacement and that as a result all the subsequent studies are fundamentally flawed. She cites other purported problems with the analysis suggested in the technical manual. She states that many of the city's low-income dwellers who lose their regulated units wind up living in shelters. She states that the technical manual irrationally suggests that displacement need not be considered where there is already a trend toward gentrification.
Respondents state that, contrary to petitioners' position, the technical manual is not a rule. Title 62, Chapter 5, Section 5-04 (c) (1), they note, includes the rules agencies must follow when they undertake a CEQR review. The manual, according to respondents, provides guidance to agencies when they perform CEQR reviews but allows them considerable discretion during the process. According to respondents, the manual "supports the dual objectives of providing the City with thorough and informative environmental review documents that assists City agency decision-making, while avoiding the bottlenecks that would result from continuously reinventing methodologies" (Mem. in Support of Answer, at p 23). They point to several points in the manual which make it clear that the manual envisions that the agencies will exercise their discretion throughout their CEQR review. For example, the introduction states that the manual's methodologies are " ‘appropriate for assessment of projects undergoing CEQR review, but are not required’ " (id. [quoting Technical Manual, Introduction, p 1). In addition, the section on socioeconomic analysis explicitly states that the guidelines therein generally indicate whether further analysis is necessary and states that under certain circumstances the suggested thresholds and computations might have to be adjusted. The section further states that, in some instances, agencies may decide to deviate from the guidelines for evaluating residential displacement. Respondents do maintain, however, that when agencies rely on the manual, they have taken "hard looks" at the proposed projects. Respondents point to instances in which, among other things, agencies enlarged the project study area beyond that suggested in the manual and considered environmental concerns that are not described in the technical manual. Furthermore, they state, even if the technical manual was subject to CAPA, this does not void the challenged environmental review. The critical issue, they state, is whether the analysis that was conducted took a hard look at the environmental issues and provided a reasoned discussion of the agency's decision.
Hilary Semel, who directs the mayor's office of environmental coordination, submits an affidavit in support of respondents which speaks to the role of the technical manual. She notes that city agencies conduct numerous environmental reviews and that the manual facilitates them in this process by outlining a "thorough, high-quality, consistent, and efficient analysis of the numerous technical areas analyzed within such reviews" (Semel Aff, ¶ 10). She states that the guidelines in the manual reflect the judgment of the mayor's office and those of numerous city agencies and departments. She stresses that the manual provides methodologies which are appropriate for CEQR review but are not mandatory. She points out the lead agency for a project "may require more, or less, information than required by the technical manual (id. , ¶ 18) and that the EAS full form notes that the lead agency might require more information to render its determination of significance. She notes that petitioners argue that because adherence to the technical manual is generally sufficient to show compliance with CEQR, the manual is a rule. This is an inaccurate analysis, she suggests, because strict compliance with any terms of the manual is not contemplated.
In reply, petitioners assert that respondents did not fulfill their obligation to promulgate official rules under SEQRA and CEQR (see ECL § 8-10113 [1]; 6 NYCRR § 617.14 [a] ). They state that ECL § 8-0113 "requires all agencies to adopt and publish, after public hearing any additional procedures that may be necessary to implement [SEQRA]" (Mem. in Reply, at p 3). They point to ECL § 8-0113 (2) (b), which requires the commissions to adopt rules which establish "[c]riteria for determining whether ... a proposed action may have a significant effect on the environment, taking into account social and economic factors." Therefore, petitioners contend, the Rules of the City of New York are deficient as they do not discuss the socioeconomic factors. The technical manual, they claim, is the document that includes the requisite rules. They allege that terms in the manual such as "guidelines" do not magically alter that fact that the manual contains rules. They argue that because the manual is inflexibly applied and determines the outcome of a CEQR analysis, it inarguably contains rules. They state that they could not locate any environmental impact statements since 2014 that deviated from the technical manual's preliminary assessment model, and that the utilization of this model invariably resulted in a finding of insignificant direct residential displacement.
As petitioners raised the City's purported violation of ECL § 8-0113 (2) (b) for the first time in their reply papers, respondents filed a supplemental response with the Court's permission. Respondents note that petitioners have misinterpreted the ECL. Specifically, they point out that this provision refers to the responsibilities of the commissioner of the Department of Environmental Conservation and not to those of the City agencies. In addition, respondents refer to ECL § 8-0113 (3), which explicitly refers to agencies, giving them the power to "adopt and publish such additional procedures as may be necessary for the implementation by them of this article consistent with the rules and regulations adopted by the commissioner." As respondents note, this renders the City and its agencies' roles discretionary. Moreover, they contend that the City exercised this responsibility and promulgated the rules it deemed necessary at 62 Rules of the City of New York, Chapter 5. There is no provision requiring each agency to create its own set of rules relating to significant impact. They further allege that, even if petitioners are correct that all the environmental impact statements petitioners have found followed the technical manual, this does not render the manual a rule because, in following the manual's guidelines, the agencies necessarily exercised their discretion.
Petitioners' response to the sur-reply does not address respondents' CAPA argument but focuses on the purported irrationality of the application of page 2-7 of the manual, which relates to the types of sites "typically excluded from development."
Arguments Specific to Ordonez
The Ordonez petition asserts that the FEIS cannot withstand Article 78 review as well. According to the petition, the FEIS erroneously and arbitrarily failed to include the potential for indirect residential displacement although acknowledging the general trend toward such displacement, and arbitrarily ignored the risk of direct displacement of rent-regulated tenants (Ordonez Petition, ¶ 79). Accordingly, petitioners request a determination that the September 19, 2017 FEIS is null and void.
This is the certification date.
The Ordonez petitioners state that the FEIS did not consider the possibility that existing rent-stabilized apartment residents might be vulnerable to direct displacement, and thus did not take the requisite hard look at the environmental impact of the project (see Matter of Wellsville Citizens for Responsible Development, Inc. v. Wal-Mart Stores, Inc. , 140 AD3d 1767, 1770 [4th Dept 2016] ; Matter of Anderson v. New York State Urban Development Corp. , 45 AD3d 583, 585 [2nd Dept 2007] ). Petitioners argue that such vulnerability exists, and in support they submit the affidavits of petitioners Ordonez and Henao. These affidavits state that since the 2012 sale of 1662 Park Avenue to their current landlord, Joco Group, LLC (Joco), Joco has engaged in a campaign of harassment with the intention of driving them and other rent-stabilized tenants out of the building. Among other things, it was not until the remaining tenants in the building obtained rent reductions from the Department of Housing and Community Renewal (DHCR) due to the lack of repairs and condition of the building that the landlord commenced repairs; and, only after repeated pleas from the Legal Aid Society on their behalf has the landlord provided renewal leases.
Petitioners' attorney, Kat Meyers of The Legal Aid Society, affirms based on her experience with housing cases that "rent stabilized tenants are at risk of displacement" (Meyers Aff, at ¶ 7) due to the illegal harassment of these tenants — including the named petitioners in this proceeding. Further, she states, mandatory inclusionary housing does not protect residential tenants in general. According to Meyers, because the mandatory inclusionary housing units require the tenants to earn either 40% or 60% of the median average income, they exclude the most vulnerable tenants from protection. Petitioner also submits the affidavit of Oksana Mironova, a housing policy analyst who works at the Community Service Society, a group which, among other things, advocates for increased funding for public and affordable housing, has submitted an affidavit as well. Mironova speaks to the dangers impacting rent-regulated tenants living at or below the poverty level. She states that 58 % of East Harlem households qualify as low-income households. A low-income family of three, she states, earns at or under $38,150 per year. Under the November 30, 2017 mandatory inclusionary housing options for the East Harlem project, the residents of 25 % of the new dwelling units would have to earn around $51,540 to qualify for a dwelling unit, and these would be unaffordable to low-income households. She also notes that due to vacancy and major capital improvement increases, dwelling units are being removed from rent-regulation laws, and the new units subject to rent-regulation are not as affordable as the older apartments. She contends that 43.7 % of low-income rent-regulated city dwellers are subjected to harassment by their landlords.
Low-income households are defined as households with incomes at least 200% below the federal poverty threshold.
Here, too, the income is that of a family of three.
In its answer, respondent City of New York asserted that the petition should be denied. It asserts that that there is no merit to the contention that it violated SEQRA and CEQR, that it complied with all requirements pertinent to its review of the project, and that petitioners lack standing to seek injunctive relief staying projects with which they lack a connection. They note that in its review of a SEQRA and CEQR decision a court examines only "whether the agency identified the relevant areas of environmental concern, took a ‘hard look’ at them, and made a ‘reasoned elaboration’ of the basis for its determination" ( Riverkeeper , 9 NY3d at 231-32 [citation and internal quotation marks omitted] ). They further emphasize that the lead agency is accorded great latitude in evaluating environmental impacts (citing Aldrich v. Pattison , 107 AD2d 258, 267 [2nd Dept 1985] ) and that, accordingly, "the courts may not substitute their judgment for that of the agency for it is not their role to weigh the desirability of any action or [to] choose among alternatives" ( Riverkeeper , 9 NY3d at 232 [citation and internal quotation marks omitted] ). They state that in this matter and in Ming , petitioners simply disagree with respondents' methodologies and conclusions. Rather than show that respondents did not take a hard look, they state, petitioners merely present community objections and conflicting expert testimony.
The answer also asserts that the petition is untimely and does not state a valid cause of action, but these positions do not appear to relate to the proceeding in question.
Respondents further argue that their analytical approach was valid. They indicate that it was rational to adhere to the methodology that the technical manual describes when they assessed the risk of direct and indirect displacement. According to respondents, it was rational to exclude rent-regulated buildings from the displacement analysis because building owners must submit to a detailed review before they can demolish a rent-regulated property. They note that it considered the reasonable worst-case development scenario and mentioned over 100 "soft sites," areas where development was likely to occur. Respondents state that they conservatively assessed the potential adverse impacts by considering the worst potential impact.
Moreover, respondents challenge petitioners' argument that displacement occurs due to rezoning because, according to respondents, petitioners provide no evidence or data in support. Respondents state that this is because they have done a thorough study and petitioners simply disagree with their methodology. Respondents further contend that petitioners misconstrue the analysis in the FEIS, as the soft sites — some of which have the potential to displace rent-regulated units — only have the potential for redevelopment. They cite Chinese Staff & Workers v. Bloomberg (26 Misc 3d 979 [Sup Ct NY County 2009] [Chinese Staff v. Bloomberg] ) in support. In Chinese Staff v. Bloomberg , the court considered a challenge to an FEIS which "provide[d] a ‘reasoned elaboration’ of the basis for respondent's concerning its ‘Reasonable Worst Case Development Scenario’ and projected development of affordable housing units calculations" ( 26 Misc 3d 979, 988 ). The court found that the agency's three-year-long review process, including calculations at which they arrived using the technical manual for guidance, had resulted in a rational determination and satisfied the hard-look standard ( id. at 988-89 ). They argue that, as in Matter of Fraydun Realty Co. v. New York City Dept of Transportation (2017 NY LEXIS [Sup Ct, NY County 2005] [Fraydun] ) and Neighborhood in the Nineties v. City of New York (24 Misc 3d 1239 [A], 2009 NY Slip Op [U] [Sup Ct, NY County 2009], aff'd , 82 AD3d 602 [1st Dept 2011] ), both of which dismissed challenges to negative declarations, this Court should dismiss this proceeding.
Respondents state that, contrary to petitioners' contention, the FEIS made no distinction between rent-regulated and non-regulated apartments. In support of this claim, they point to pages 3-14 through 3-24 FEIS. They explain that the FEIS made a preliminary assessment concerning displacement and determined that a detailed assessment was not necessary. The preliminary assessment does not differentiate between regulated and non-regulated dwelling units. The pages of the FEIS to which respondents cite only mention regulated and government-run dwelling units in the context of explaining the wide range in income in the community's residents. Respondents additionally argue that in this proceeding petitioners make allegations, such as the harassment of Ms. Ordonez and Mr. Henao by their landlord, which were not raised during the environmental review process. Respondents further argue that the study ignored the potential for abuse of the preferential rent system, arguing that it is "well outside the scope of analysis in an environmental review" (Mem. in Support of Answer, at p 18). They dismiss petitioners' argument that respondents should not have considered trends such as gentrification in their analysis of the project's impact, and they state that the manual neither sets a bright line rule regarding displacement nor prohibits a detailed review of indirect residential displacement.
Of these, only pages 3-17 to 3-24 refer to indirect displacement.
Furthermore, respondents contend, the exclusion of rent-regulated apartments from the detailed study would have been rational.
In addition, indirect residential displacement will not result from the East Harlem Project because, according to respondents, the population will increase by under 5%. Although under the technical manual this normally is the end of this aspect of the analysis, respondents state, they exercised their discretion, divided the project area into three sub-areas, and studied each independently. Due to this analysis, they note, respondents further evaluated a sub-area in mid-east Harlem, where the projected population increase was 8.2%. They state that because they utilized the guidelines of the technical manual, the FEIS should be upheld (citing Chinese Staff , 88 AD3d at 429 ). They cite to numerous cases in which courts upheld determinations that followed the technical manual's guidelines.
Respondent submits the affidavit of Robert Dobruskin, the director of the environmental assessment and review division of the DCP. Dobruskin oversaw the environmental review of the East Harlem Rezoning Project and was involved in the preparation of both the DEIS and the FEIS. He notes that the FEIS "incorporated revisions to the environmental analysis set forth in the DEIS" as the result of technical analysis respondent conducted — which, in turn, respondent conducted partly in response to the comments it received at the public hearing and in the written submissions.
Erik Botsford, the deputy director of Manhattan's DCP office, has also submitted an affidavit in support of respondent. He supports Dobruskin's conclusion that DCP's analysis of socioeconomic impacts rationally utilized the methodology set forth in the technical manual and took the requisite hard look at potential adverse impacts. He states that petitioners evidence "a misunderstanding regarding the purposes, goals, and effects of the Rezoning" (Botsford Aff, at ¶ 7). He suggests that the rezoning and the plan in general gets rid of rules which limited housing development, creates mixed income housing, and makes room for the development of permanently affordable housing. He states that the mandatory inclusionary housing in the project area is just one part of a comprehensive plan to create permanent affordable housing throughout New York City. He states that due to the upsurge in housing demand and the disproportionately high rent increases, East Harlem is a particularly appropriate area for a project which, contrary to petitioner's contention, increases the security of lower-income tenants. According to Botsford, without the project vulnerable tenants would be at greater risk of displacement because the current zoning law does not require developers to provide affordable housing. In addition, Botsford states that because of the project, areas surrounding the 96-block area will undergo "concurrent and complementary efforts from other City agencies [which] provide[s] housing stock elsewhere in East Harlem" (id. , at ¶ 36). He points out that although Community Board 11 did not support the project plan, it found the project's overall goals laudable.
According to Botsford, it is not possible to accommodate all the changes that were suggested. For example, mandatory inclusionary housing does not allow deeper levels of affordability. He states that "based on HPD's commitment" there will be apartments that "could reach even deeper levels of affordability than possible through the [mandatory inclusionary housing] program alone" (id. , ¶ 49). Moreover, the community board recommended tenant protections, but HPD is the agency that implements protective measures. They are not part of a developer's proposal. He states that the project was adjusted — as it relates to height limits and lower-density developments — in response to the borough president's comments as well as to public comments.
Leila Bozorg, the Deputy Commissioner for Neighborhood Strategies with HPD, attests that the city has increased housing for the lowest-income households, created programs for senior citizens, and expanded supportive housing for individuals who are formerly homeless and disabled. She further describes the city's increased efforts to prevent secondary displacement and harassment by landlords. She states that there are additional initiatives city-wide. She notes that the Sendero Verde development that is planned for East Harlem will include 680 homes, all of which are affordable and half of which are permanently affordable, and 20% of which will be reserved for extremely low-income families. She further points out that the City transferred ownership of 39 buildings to Hope East of Fifth, a "re-syndication project" (Bozorg Aff., ¶ 14), and has provided financing so the buildings can be rehabilitated and made accessible to disabled residents. The 506 apartments in these buildings, she notes, "will have rent restrictions between 50% and 60% of the [AMI] and 102 of those units will also be set aside for homeless individuals and families as they become available" (id. ). She states that incomes in the East Harlem project area "were rising at an alarming rate" before the City announced the rezoning plan, and that the East Harlem project actually will increase the number of affordable dwelling units in the area (id. , ¶ 20).
Petitioners reply that, regardless of whether the technical manual contains rules and is subject to CAPA, respondents adhered to certain portions of the manual in an arbitrary and capricious manner. They reiterate that it was irrational to exclude rent-stabilized dwelling units from review and to conclude that because of mandatory inclusionary housing, there would be no indirect displacement. They state that soft sites are more likely to be developed due to the rezoning, that there are stabilized buildings at these sites, and that the FEIS should have factored this into its direct displacement analysis when comparing the no-action and the proposed-action scenarios.
Furthermore, petitioners state, the FEIS' consideration of indirect displacement is irrational because it acknowledges that the average income level will rise from the rezoning and the population of mid-east Harlem will likely increase by around 8.2%, but it concludes that there will be no significant adverse impact because "some housing will be built that is ‘affordable’ in name, but beyond the reach of the average household in the study area" (Petitioner's Reply Mem., at p 13). They state that respondent's opposition to their position is that many apartments in the area are already unaffordable to area residents. This answer, if sufficient, "will insulate the City from judicial review of ... every zoning that occurs" (id. , at 14). These errors are critical, petitioners contend, because had respondents determined there was a significant adverse impact they would have considered mitigating measures and alternatives to the current project. For example, they note, pointing to page 5-22 of the manual, respondents might have devised a plan which increases the number of affordable housing units.
Arguments Specific to Ming
Petitioners allege that the challenged determination is arbitrary and capricious because it ignores the potential for indirect residential displacement. They state that it was arbitrary of OHMED to use the 5% population growth cut-off when it evaluated displacement because "the study area was artificially inflated to make the area commensurate with the census tracts" (Ming Petition, ¶ 54). This created a 4.4% rather than a 5% population increase and thus enabled the lead agency to bypass a full analysis of indirect displacement.
In addition, petitioners state, the 5% cut-off itself is arbitrary. Instead of having a rational basis, they argue, the evaluative model the government respondents have used is reflective of "unchecked gentrification and the City's failure to use the environmental review procedures to accurately assess the risk of displacement in those cases where the development at issue is unquestionably contributing to that pressure" (Ming Mem. of Law, at p 11). They note that landlords can raise the rent of regulated tenants between 0% and 7.75% annually or biannually but that landlords can impose a vacancy bonus and increase the rent up to 20% whenever a regulated apartment becomes vacant. Petitioners point out that this increases the desire of landlords to get regulated tenants out of their current apartments and that, in fact, 54 % of the rent increases in Crown Heights, where the armory is located, are due to this turnover (id. , at p 12).
Petitioners state that the percentage rates recently have fluctuated between these numbers.
The City of New York and the New York City Council (collectively, the City) have answered jointly. The City alleges that it did not render an irrational decision. It argues that petitioners impermissibly argue that the study area was inflated artificially, and that the application of the 5% population growth threshold is arbitrary, because these arguments were not raised before OHMED during the public review process. The City cites Watergate II Apt. v. Buffalo Sewer Auth. (46 NY2d 52, 57 [1978] ), in which the Court of Appeals held that, with certain exceptions, one of which applied there, petitioners must exhaust their administrative remedies before appealing agency decisions. In the context of a SEQRA and/or CEQR review, the City contends, courts do not "review a determination on environmental matters based upon evidence or arguments not presented during the proceeding before the lead agency" (citing Aldrich v. Pattison , 107 AD2d 258, 267-68 [2nd Dept 1985] ). It notes that the environmental review process "is designed as a cooperative venture, the intent being that an agency [has] the benefit of public comment before issuing an FEIS and approving a project; permitting a party to raise a new issue after issuance of the FEIS or approval of the action has the potential for turning cooperation into ambush" (City Mem. of Law, at * 4 [quoting Matter of Jackson v. New York State Urban Dev. Corp. , 67 NY2d 400, 428 [1986] ).
In addition, the City argues, petitioners have not articulated a legitimate challenge to the Armory project. The City cites Coalition against Lincoln West, Inc. v. Weinshall (21 AD3d 215, 222 [1st Dept] [citations and internal quotation marks omitted], lv denied , 5 NY3d 715 [2005] ), which states that a court considers only "whether the lead agency identified the relevant areas of environmental concern, took a hard look at them, and made a reasoned elaboration of the basis for its determination." It stresses that the court's role is not to consider whether there was a better alternative, to weigh alternative actions, to resolve disputes among the parties' experts, or to enforce its own judgment about the project, but to determine whether the agency followed the mandated procedure and its determination was not arbitrary, an abuse of discretion, or affected by an error of law (see also Kellner v. City of New York Dept. of Sanitation , 107 AD3d 529, 529-30 [1st Dept 2013] ). It states that a challenge to its methodologies, rather than a challenge based on valid evidence, is not an appropriate basis for review utilizing this standard (citing Matter of Chinese Staff v. Bloomberg , 26 Misc 3d at 989 ).
Considering these standards, the City argues, its determination was rational. The FEIS rightly noted that three areas of significant impacts and conducted further analysis, employing mitigation measures which fully mitigated the impact on historical and cultural resources and partially mitigated the impact on construction and transportation. The FEIS further conducted a "robust" evaluation of the socioeconomic conditions (City Mem. of Law, at *7). It states that even though the projected increase in population of 4.4% fell below the threshold suggested in the technical manual, "the FEIS proceeded to the next step and considered whether the Project would accelerate a readily observable trend... that might potentially displace vulnerable populations" (id. , at *9). This, the City alleges, went beyond the suggestions in the manual, thus taking more than the requisite hard look. As in Ordonez (see supra at pp 31-32), the City in this proceeding relies on cases such as Chinese Staff v. Bloomberg , Fraydun , and Neighborhood in the Nineties for support. Furthermore, the City argues that its reliance on the technical manual was rational and notes that "every court that has considered the issue has held that following the guidance of the CEQR Technical Manual and providing a reasoned elaboration of the analysis is sufficient to demonstrate that a ‘hard look’ was taken at the environmental impacts" (City Mem. of Law, at *11 [italics in original] ).
The City additionally alleges that petitioners' argument regarding the elongation of the study area and the 5% rule is without basis, and that petitioners' conclusory assertion that there was no justification for the elongation or the 5% rule is insufficient. They argue that petitioners' contention that the City did not take the vulnerability of rent-regulated tenants into consideration lacks merit. As in Ordonez , the City states that the initial review did not distinguish between regulated and non-regulated units, and thus it necessarily considered the former as well. Further, the City argues, petitioners raise policy issues regarding regulated units that go beyond the scope of a SEQRA or CEQR analysis (see supra at pp 32-33, addressing identical arguments in Ordonez ).
The City also submits affidavits in support of its answer. In addition to the affidavits of Hilary Semel of the mayor's office of environmental coordination and Leila Bozorg, of HPD's Office for Neighborhood Strategies, both of whom also filed affidavits in support of Ordonez , the City submits the affidavit of Jeffrey Nelson, the executive vice president of Real Estate Transaction Services, which is part of New York City Economic Development Corporation (NYEDC). Semel participated in the environmental review of the Armory Project. She stresses that of the 415 new dwelling units, at least 250, or 60%, will be "affordable" (Semel Aff., at ¶ 6), and that there will be a recreation center, a community center, and offices available to neighborhood non-profit groups. She notes that the lead agency, OMHED, undertook a detailed evaluative process and that the final Scope of Work analysis "incorporate[ed], where appropriate, changes to the scope that were made during the public comment process" (id. , ¶ 14) as well as comments the agency received on the draft Scope. OMHED made modifications to the FEIS, she notes, based in part on the public comments. After it released the FEIS, moreover, City Council member Laurie Cumbo, along with some community stakeholders and officials from the area, requested additional modifications to the ULURP application which OMHED incorporated. These modifications — among other things, changing the proposed luxury condominium apartments to rental units and increasing both the percentage of affordable units and their level of affordability — necessitated the issuance of a technical memorandum, which determined that only the transportation analysis was impacted.
The affidavit does not detail the modifications but refers generally to the entire FEIS. The Court notes that the file for the Armory project (see fn 9 for citation) includes three sub-files, all part of FEIS Chapter 23, which details these alterations.
In addition, Semel describes the socioeconomic analysis. In general, she states, indirect displacement alone generally does not have "a significant environmental impact[ ] for purposes of CEQR," but instead has significance only if the changes "introduce or accelerate an existing socioeconomic trend making it difficult for residents or businesses to remain" (id. , ¶ 29). She describes the socioeconomic review process OMHED conducted for the Armory project. She indicates that the purpose of the adjustment to the original .25-mile evaluation area — which petitioners criticize as artificially inflated — was "to include all census tracts with at least 50% of their area within the 0.25-mile radius of the [Armory] Project site" (id. , ¶ 36). The adjustment did not include three tracts which did not meet this 50% threshold. She states that the enlargement of the study area was in accordance with the technical manual's guideline and it was rational to follow this guideline for the Armory project.
Next, Semel states that the 5% population increase threshold which the technical manual suggests is rational here because "this increase ... is too small, in comparison to the overall population, to affect conditions in the local real estate market" (id. , ¶ 43). She contends that it was rational to conclude that rents and property values in Crown Heights already are increasing and that the Armory project would not significantly accelerate this trend. She further relies on the study in the technical manual, which reiterated this conclusion in light of the additional changes. Petitioners' arguments to the contrary, she contends, "misinterprets and overlooks the rationale behind the CEQR methodology" (id. , ¶ 49). The 5% "guideline," she states, merely "is a conservatively set and de minimis guideline" (id. , ¶ 51) and, with other guidelines, provides a rational basis for review.
Semel also rejects petitioners' argument that the environmental study of indirect residential displacement should have included rent-regulated apartments because tenants in those apartments may be subject to predatory or illegal conduct by which landlords intend to force these protected tenants to move out of the premises. This argument has no merit, Semel states, because "[t]he purported inadequacies of ... laws [intended to protect these tenants], and the attempt to quantify and predict actions of landlords who take advantage of [the inadequacies] is not within the purview of the environmental review process, which is intended to disclose a project's potential impacts, not set policy" (id. , ¶ 58). Similarly, she states, the issue of potential abuses relating to preferential rent is not pertinent to the environmental review. Moreover, this argument incorrectly assumes that all landlords who grant preferential rents have predatory intentions, that the motive for offering such rents is invariable, that these rents deviate from the legal rent to an extent which makes exploitation possible, or that the tenants cannot afford the legal rent; and, it is irrelevant because the FEIS rationally concluded that there was no need to conduct a detailed study of this issue. Finally, she argues, there is no data available from which it can make an assessment of which tenants who pay preferential rent are vulnerable to displacement.
The Nelson affidavit explains that Real Estate Transaction Services, which he heads, involved him in the RFP consideration and approval process for the Armory project. He states that when they considered the responses to the RFPs for this project, they "conducted an extensive community engagement process to better understand how the redevelopment of the Bedford Union Armory might address the needs of the surrounding community" (Nelson Aff., ¶ 11). They held two public meetings and met with local organizations and elected officials before they determined that Bedford Courts had submitted the project that was most in conformance with the RFP and the community needs. He noted that, in the original plan, even the apartments not reserved as affordable housing would not be offered to those whose income exceeded 130% of the AMI. He asserts that the final allocation of apartments set aside for mandatory inclusionary housing "helps fulfill one of the major policy initiatives of Mayor Bill De Blasio and addresses an acute need in this community" (id. , ¶ 32). He stresses that the apartments that are part of this allocation "remain permanently affordable" (id. , ¶ 34) and that, in response to feedback the Armory project now has 79 more affordable apartments than there were in the original proposal and it makes affordable housing "available to people with far lower incomes than was originally proposed" (id. ), and eliminates condominiums from the plan. His affidavit also outlines additional components of the project, such as the recreation center, which are not pertinent to the challenges petitioners assert.
Leila Bozorg, the Deputy Commissioner for Neighborhood Strategies with HPD, reiterates her general discussion about the impact of both projects. She points out that Camba Gardens II, which is near the Armory, has added to the existence of affordable housing in the area, with 180 of its 293 apartments earmarked for the formerly homeless and those with special needs, and 110 set aside for families earning up to 60% of the AMI for that project area. She states that aside from the Armory project, too, the City offers loans and tax incentives which enable building owners to repair and preserve affordable housing and assists mission based organizations and community land trusts to purchase and preserve rent-regulated buildings. She further describes a low-interest loan which, among other things, protects affordable apartments in Crown Heights, where the Armory is located, and two other neighborhoods. She claims that the Armory project furthers the City's goals of increasing the number of "quality affordable homes" and nurturing the diverse and equitable community of Crown Heights (id. , ¶ 24).
Bedford Courts also submits an answer in opposition to the petition. In addition, it submits the affidavit of John Valladares, project manager for the Armory project, and a memorandum of law. Valladares states that Bedford Courts is an affiliated entity of BFC Partners Development, LLC (BFC), which focuses on affordable, market-rate, and government-subsidized housing. In addition, he states, it has developed housing projects marketed exclusively to artists and to people who formerly were homeless (Valladares Aff, ¶ 3). Currently BFC is developing the Ingersoll Senior Residencies, the City's "first 100% affordable lesbian, gay, bisexual, and transgender (LGBT) friendly senior housing project" (id. , ¶ 4). He points out that, in response to community and local leaders' concerns, it has made substantial modifications to the project — including, as indicated, the removal of condominiums from the Armory project. He states that the project "will revitalize a long-vacant building" and that its recreational, commercial, and community spaces are responsive to the needs of a diverse array of Crown Heights residents (id. , ¶ 11).
In addition, he notes that the Armory project includes Brooklyn Plaza Medical, which provides medical care regardless of a patient's ability to pay or insurance status. He reiterates the City's statements regarding the affordability of 60% of the dwelling units, and states that, although petitioners and others ask that 100% of the dwelling units be affordable, this would "jeopardize the long-term health and viability of the residential buildings, and would render financially infeasible the development of the recreation and community facility" (id. , ¶ 19). He describes the other benefits of the Armory project to the community, including Bedford Courts' push to hire women and minority run businesses and to hire New York City residents for construction work as well as permanent positions. He states Bedford Courts has worked with the community throughout and has widespread support, and notes that the Armory project was overwhelmingly approved.
Bedford Courts also submits a legal memorandum, which is well-reasoned but does not raise additional legal arguments.
In reply, petitioners reiterate their earlier arguments, many of which relate to CAPA and which this Court has set forth above. In addition, it states that because the technical manual's provisions relating to the indirect displacement analysis are arbitrary and the City followed these arbitrary rules or guidelines, the Armory project analysis is fatally flawed. It distinguishes Chinese Staff v. Bloomberg in that it relied on an earlier version of the technical manual which did not contain the purportedly rigid and arbitrary thresholds for this aspect of an environmental review. Furthermore, it alleges that the environmental review arbitrarily omitted 1519-1535 Bedford Avenue from its analysis and, had it done so, the population increase would have been 6.59% and subject to review.
Petitioners' reply discusses segmentation, "the division of the environmental review of an action such that various activities or stages are addressed as though they were independent, unrelated activities, needing individual determinations of significance" (Saratoga Springs Preservation Foundation v. Boff , 110 AD3d 1326, 1328 [3rd Dept 2013] ). It appeared to respondents and to this Court that petitioners were arguing that the Ming decision should be vacated because it separately reviewed the Armory project and another development. Accordingly, the Court allowed respondents to address this point in their sur-reply. In their sur-sur-reply, petitioners clarify that they discussed segmentation to illustrate the bright-line rules with which agencies apply CEQR. The Court thus does not address the issue, but notes that there was no segmentation in this instance.
Petitioners claim Rimler v. City of New York (2016 NY Misc LEXIS 4179, 2016 NY Slip Op 51627 [U] [Sup Ct, NY County, July 7, 2016, Index No. 506046/2016] and Neighborhood in the Nineties , on which respondents rely, do not endorse thresholds per se but state that use of the thresholds "insulate the City from any meaningful review of its methodologies" (Petitioner's Mem of Law in Reply, at *15). They that they exhausted their administrative remedies, as "[r]espondents were made aware that community members, community organizations, and elected officials had concerns about indirect residential displacement" during the public hearings, which discussed the connection between gentrification and such displacement (id. , at * 17).
Discussion
CAPA
As the Court of Appeals has stated, there is a critical distinction between those decisions which are "based on individual facts and circumstances," and a course of conduct which relies on "legislative or quasi-legislative norm or prescription" ( Alca Industries, Inc. v. Delaney , 92 NY2d 775, 778 [1999] [Alca] ). " ‘[O]nly a fixed, general principle to be applied by an administrative agency without regard to other facts and circumstances relevant to the regulatory scheme of the statute it administers constitutes a rule or regulation’ " subject to CAPA ( Council of the City of New York v. Department of Homeless Serv. of the City of New York , 22 NY3d 150, 154 [2013] [Homeless Serv.] [quoting Matter of New York City Transit Auth. v. New York State Dept. of Labor , 88 NY2d 225, 229 [1996] [decided under State Administrative Procedure Act (SAPA) ] ) . Where "the ostensible ‘policy’ dictates a specific result in particular circumstances without regard to other circumstances relevant to the regulatory scheme" it is subject to CAPA ( 439 E. 88 Owners Corp. v. Tax Commission , 307 AD2d 203, 203[1st Dept 2003] ; see DeJesus v. Roberts , 296 AD2d 307, 310 [1st Dept 2002] ["[t]he rulemaking process is mandatory when an agency establishes precepts that remove its discretion by dictating specific results in particular circumstances"], lv denied , 99 NY2d 510 [2003] ).
The principles undergirding CAPA and SAPA are the same, so courts regularly turn to both SAPA and CAPA cases for guidance when a petitioner invokes either one.
Alca points out, illustratively, that in one case a policy which established speed limits was deemed a rule, and in another the court reached the same result with respect to a uniformly applicable Department of Labor procedure which set forth a uniform formula for the recoupment of unemployment insurance overpayments ( Alca , 92 NY2d at 778 [citing People v. Cull , 10 NY2d 123, 127 (1961) and Matter of Schwartfigure v. Hartnett , 83 NY2d 296 (1994), respectively]. In addition, in Homeless Serv. , the Court of Appeals found that mandatory eligibility procedures that applied to all temporary housing assistance applications were subject to CAPA. Even though the agency had discretion to determine whether an applicant was "cooperative" enough to qualify for assistance, it had no discretion to forego such determination, to deviate at all from the nine-page mandatory process for determining eligibility, or to disregard the additional eligibility requirement that the applicant satisfy a specified need standard ( Homeless Serv. , 22 NY3d 150 ).
When there is room for discretion or deviation, on the other hand, CAPA (or SAPA) is inapplicable. In Alca , for example, the Court of Appeals found that the petitioner's rights and remedies under bid withdrawal procedures were not rules; because they "were entirely determined on the basis of bidding conditions," the guiding policy was not conclusive of the petitioner's rights and remedies ( Alca , 92 NY2d at 779 ). In Harding v. Calogero (45 AD3d 363, 364 [1st Dept 2007] ), the First Department found that DHCR's methodology for computing rents, though used regularly, was not subject to SAPA because DHCR retained the discretion to deviate from the methodology and to consider additional factors. Matter of Rye Psychiatric Hosp. Center v. New York State Office of Mental Health (65 AD3d 689, 690 [2nd Dept 2009], lv denied , 14 NY3d 706 [2010] ), a Third Department case, found that a general policy which "mandate[ed] separate housing and therapy services for minor and adult patients was not an inflexible rule removing that agency's discretion."
Based on this and a plethora of other precedent, and after careful consideration, this Court concludes that the publication of the manual or of its amended versions did not trigger the rulemaking requirements of CAPA. The manual "do[es] not impose ‘fixed, general principle[s] to be applied ... without regard to other facts and circumstances relevant to the regulatory scheme of the statute it administers" ( Matter of Adirondack Wild: Friends of the Forest Preserve v. New York State Adirondack Park Agency , ––– AD3d ––––, ––––, 2018 NY Slip Op 03193, *11-12 [3rd Dept 2018] [citing Matter of Roman Catholic Diocese of Albany v. New York State Dept. of Health , 66 NY2d 948, 951 [1985] ). Throughout the technical manual, there is language which makes clear that a lead agency should use the document to assist it in reaching its "discretionary agency decision" (Technical Manual, Introduction-1). The manual states that the methodologies it provides generally are appropriate but that they "are not required by CEQR" because some projects may "require different or additional analyses" (id. ).
Contrary to petitioners' argument, the use of terms like "discretion" and "judgment" are not inserted into the manual to create the false impression that the manual is not a set of rules. Instead, the manual continually reminds lead agencies to exercise their discretion rather than to rely reflexively on the guidelines. For example, Chapter 3, which introduces the analytical guidelines, states that in certain circumstances the lead agency in its discretion may "consult or coordinate with the City's expert technical agencies" rather than making an evaluation based solely on its adherence to the manual (Technical Manual, Introduction to the Technical Guidance, 3-2). The issue of whether there is a significant impact, the chapter states, "generally can be determined with relative definiteness by applying objective criteria" (id. [emphasis supplied] ). In evaluating the impact on neighborhood character or urban design, among other things, however, "a change may be identified, but its significance requires a more subjective evaluation" (id. ). The chapter also notes that the lead agency should "consider public policy and public comments in addition to the technical studies" to further evaluate the impacts of the project (id. ).
Chapter 5 of the manual, which is a focal point of the challenges to the two environmental reviews here, contains comments which stress the discretionary nature of the lead agency's review of socioeconomic factors. It notes that a residential profile of the impact area "typically includes" specific factors including household size and income but should also encompass "any other appropriate indicators of the economic conditions of residents" (Technical Manual, Chapter 5: Socioeconomic Conditions, 5-2). If a more detailed assessment is necessary, the manual suggests that the lead agency "include some or all of" certain specified characteristics. The chapter proceeds to set forth suggested thresholds for determining whether a detailed residential displacement analysis is necessary, and adds that "certain circumstances may warrant different thresholds" (id. , 5-3). It leaves it to the agencies to determine whether such circumstances exist in a specific case, noting only that "the proposed threshold may be too high or low depending on the characteristics of the study area" (id. ). The chapter states that a lead agency may decide to "create subareas for analysis" for larger projects "if the project affects different portions of the study area in different ways" (id. ). It provides examples of when this situation may arise but does so illustratively rather than as an exclusive list. Throughout the rest of the chapter, there are examples of ways in which the manual gives agencies the discretion, among other things, to add factors to its review and eliminate from review factors the agency determines are not applicable.
The Court quotes Chapters 3 and 5 as they are the ones discussed in the two proceedings before it, but notes that the quoted language is reflective of the manual as a whole.
Petitioners argue that this language is not relevant because lead agencies invariably rely on the computations in the manual when they conduct CEQR reviews. Thus, petitioners contend, lead agencies treat the guidelines as rules and the manual should have been approved pursuant to CAPA. This argument fails. Although the guidelines contain numerical formulas, "they do not establish a rigid, numerical policy which the drafters intended to be "applied across-the-board ... without regard to individualized circumstances" ( New York City Transit Auth. , 88 NY2d at 229-30 [1996] [citations and internal quotation marks omitted] ). The manual repeatedly indicates that agencies should exercise discretion in the implementation of the guidelines. Unlike the rule considered in Homeless Serv. (22 NY3d 150 ), it is not mandatory that the agencies here must consider every factor listed and apply every formula, in that agencies have the power to add factors for consideration.
This Court does not find petitioners' other arguments on this point persuasive. The fact that "the methodology used has been affirmed in other cases" does not convert the manual to "an inflexible rule removing that agency's discretion" ( Harding v. Calogero , 45 AD3d 363, 364 [1st Dept 2007] ). Instead, it simply means that in those cases the courts determined that the guidelines were applied rationally. It also means that the lead agencies adhered to the guidelines and exercised their discretion when they chose to weigh the various factors or apply the specific formulas. Instead, when a lead agency uses the mathematical formulas in the guidelines without applying discretion or considering the development at issue — as if it were, in fact, a rule — then the analysis rather than the manual is vulnerable, under the arbitrary and capricious standard. The Court, therefore, evaluates the application of the manual to the facts of the two proceedings in determining the rationality of the environmental reviews.
SEQRA/CEQR
"By finding ‘socioeconomic issues’ to be considered under the rubric of environmental concerns, the Court of Appeals implicitly indicated that the standards and scope of review as to the appropriateness of their consideration should be no different from the standards of review and the scope of any review of other environmental concern" ( Matter of Nash Metalware Co. v. Council of NY , 14 Misc 3d 1211 [A], 2006 NY Slip Op 52485[U], *28 [Sup Ct, NY County 2006] ). Under this standard, "courts will overturn an agency's determinations only when they are arbitrary and capricious or unsupported by substantial evidence" ( Jackson v. New York State Urban Development Corp. , 110 AD2d 304, 307 [1st Dept 1985], aff'd 60 NY2d 400 [1986]; see Friends of P.S., Inc. v. Jewish Home Lifecare, Manhattan , 146 AD3d 576, 577 [1st Dept], aff'd , 30 NY3d 416 [2017] ). Thus, petitioners' challenges are governed by a rational basis standard (see Chinese Staff & Workers' Association v. Burden , 19 NY3d 922, 924 [2012] ). Courts limit their review to the question of whether respondents "identified the relevant areas of environmental concern, took a hard look at them, and made a reasoned elaboration of the basis for its determination" (Matter of South Bronx Unite! v. New York State Industrial Devel. Agency , 115 AD3d 607 [1st Dept 2014] [upholding respondent's determination that SEIS was not required]; see Spitzer v. Farrell , 100 NY2d 186, 190 [2003] ). Courts cannot replace the judgment of the agency with their own, "for it is not their role to weigh the desirability of any action or [to] choose among alternatives" (Matter of C/S 12th Ave. LLC v. City of New York , 32 AD3d 1, 6-7 [1st Dept 2006] [citations and internal citation marks omitted] ).
A. Ordonez
The Ordonez petitioners challenge both the direct and indirect placement analyses respondent conducted for the East Harlem project. They say it was irrational to find that although the population in a portion of the study area would increase by more than 5% and the AMI would increase as well, there was no significant indirect displacement merely because there was a trend toward increased housing prices and increased median income levels in East Harlem already. They suggest the determination that the 96-block project would only directly displace 27 residents defies logic. According to petitioners, the conclusion that rent-stabilized tenants are immune from adverse impacts is irrational. Because of this fundamental misunderstanding of the impacts, they urge, the City failed to take the requisite hard look at the project.
After careful consideration, this Court finds that respondent took the requisite hard look when it considered the indirect impact of the project on area residents. As respondent argues, the manual is not a rule but a guideline, and agencies should exercise their discretion by adapting their analysis according to the scope and possible impacts of the project. The FEIS divided the East Harlem project into three subareas for its socioeconomic review because the project covered a 96-block section of New York City, with 69 development sites to be completed by 2027, 100 "soft sites" where development might occur, and 32 development sites projected for completion after 2027. This is a rational accommodation for the size of the project.
Respondent's statement that only 27 residents, in 11 apartments, will be directly displaced between now and 2027 has a rational basis. The Botsford affidavit explains the reasoned process through which respondent defined the zoning area, and further explains that the zoning was structured in a way to minimize displacement. It is not the Court's role to question this methodology, which respondent explains at page 3-6 of the FEIS. Further, the Court notes, respondent explains in the record that an additional 160 residents might be displaced but that this displacement would occur with or without the East Harlem project. The Court finds this argument about the natural projected growth of the community to be persuasive.
Community leaders, including those who mandatorily participated in the ULURP review process, voiced concerns about the project's socioeconomic impacts. One of the biggest criticisms was that the 96-block project did not provide for deeply affordable housing. Respondent argues that it complied fully with the mandatory inclusionary housing model, which sets forth specific choices which create, at maximum, a small percentage of apartments available to those earning 40% of the median household income. At oral argument, respondents further noted that this project reflects an overall policy in the City to provide affordable residences throughout the boroughs (see Transcript, pp 17-18). The Botsford affidavit refers to projects outside of the East Harlem project site — such as the Sendero Verde development, which is in East Harlem but outside the project area, and Camba Gardens II in Brooklyn — which includes affordable and deeply affordable housing (Botsford Aff., ¶¶ 11-12). The administrative record supports these arguments. CPC stated that it would develop more than 2,000 additional affordable apartments, including — "where feasible" -- units with "deeper levels of affordability" when they are on publicly owned sites (Lead Agency Report, at p 15). CPC also noted that the plan included "proposals to identify distressed buildings, ... provide free legal services to tenants [, and] ... explore new ways to preserve the existing affordable housing stock, such as piloting a community land trust program and studying the feasibility of a Certificate of No Harassment program" (id. ).
The Court rejects respondent's position — here and in Ming — that it had no power to include apartments with deeper levels of affordability. For one thing, respondent appears to have added this justification after the administrative record was closed, as it has not cited to the record for this statement and the Court did not locate it. For another, in Ming the respondent added deeply affordable housing to the Armory, including residences for the formerly homeless. Though the lead agency had the discretion to include more deeply affordable housing, however, it also had the discretion to decide this was not necessary. The Court's position as to whether greater affordability would have been preferable in the project area is not relevant (see Matter of C/S 12th Ave. LLC v. City of New York , 32 AD3d 1, 6-7 ).
In addition, petitioners argue the review irrationally ignored the danger of illegal harassment by landlords. The Court finds that respondents were rational here and in Ming in stating that illegal harassment by landlords is not within the scope of SEQRA/CEQR review but, rather, is properly considered 1) when such situations arise, on an individual or class basis, or 2) by the state or local legislature. It need not discuss the parties' other arguments, although it has duly considered them.
Ming
The Court dismisses the petition in Ming as well. Although the environmental review concluded the increase in population would be under 5%, the lead agency conducted a more detailed examination. OHMED, then, did not reflexively apply the 5% cut-off but exercised its discretion and considered the issue more fully. Petitioners' contention that the lead agency disregarded the criticisms of the community, the borough president, and the community board after the issuance of the DEIS and FEIS is belied by the facts. On the contrary, after it considered the comments, the lead agency decided that the project would no longer include luxury condominiums reserved for purchasers with higher incomes. Initially, too, the plan set aside 215 dwelling units for residents earning 40%, 50%, and up to 110% of the AMI; after considering all comments, the plan was altered so that more apartments were affordable housing, and they were available to residents earning 30%, 40%, 50% and 60% of the AMI, and included apartments for the formerly homeless. The project also set aside discounted memberships to the recreation center for area residents. Thus, many features of the Armory project changed noticeably to address the needs and concerns of the community. Petitioners claim here and in Ordonez that it was irrational to decide that the projects do not noticeably increase trends already in existence. The Court rejects this argument, as respondents duly considered the trends and evaluated the impact of the project on this trend. It is not the Court's role to second-guess these calculations. Petitioners' additional arguments under Article 78 are not persuasive.
The board's suggestion had been to dispose of all dwelling units, making the Armory solely a business and community center, but alternatively to make all housing affordable. The borough president also suggested making all dwelling units affordable.
Conclusion
The Court is sympathetic to petitioners, who aim to protect those who are not members of community boards, are not elected officials, and often do not express their positions at public hearings. It also recognizes the important role respondents play in the evolution of this City and the laudable aim of including affordable housing in residential developments. The goal of the City, and of the projects at hand, is to balance the interests of the communities, including those of their more impoverished members, against the interest in promoting progress, beautification, and increasing hospitals, shops, recreation centers, and other facilities which benefit neighborhoods even while gentrifying them. This Court's role, in turn, is not to question the way in which the City, entrusted with these projects, draws the balance. Its role is only to examine whether the lead agency, on behalf of the City, considered all relevant areas of environmental concern and examined them rationally ( Coalition against Lincoln West, Inc. , 21 AD3d at 222 ). As respondents satisfied their obligations in both cases, therefore, it is
ORDERED and ADJUDGED that the petition/action in Ordonez , Index No. 450100/2018, is dismissed; and it is further
ORDERED that the petition/action in Ming , Index No. 101680/2017, is dismissed.
The Clerk is directed to enter judgment accordingly.