NYC DOT Proposes Pedestrian Plaza Regulations

Public comments are being accepted through May 23, 2016.

On April 22, 2016, the New York City Department of Transportation (“DOT”) published and solicited public comments on proposed rules to regulate DOT’s 73 existing and planned pedestrian plazas in New York City. The New York City Council passed a bill authorizing DOT to promulgate regulations applicable to the pedestrian plazas on April 7, 2016, which was signed into law by Mayor de Blasio on April 21, 2016. Reporting on the new legislation has tended to focus on provisions in the new rules that allow DOT to limit the areas of pedestrian plazas in which street performers (including the costumed characters and “desnudas” of Times Square) and vendors may operate; however, the regulations are significantly broader than this and serve to formalize the pedestrian plaza program. To date, DOT has created pedestrian plazas on an ad hoc basis without any formalized regulation of the activities therein. This has generally meant that DOT-created pedestrian plazas continue to be regulated as streets rather than public spaces, an imperfect fit that the proposed regulations aim to ameliorate.

The proposed DOT rules do the following:

  • Create a uniform, streamlined process for proposing and applying for the pedestrian plaza program. Per Section 2 of the proposed rules, individuals and organizations may submit to DOT proposals advocating for the designation of an area as a pedestrian plaza. If DOT determines that a proposed plaza is viable, a potential “pedestrian plaza partner” organization can submit an application for such plaza. The documentation required to be submitted with the application is specified in the proposed regulations; however, it is important to note that the applicant must be (1) “an organization operating within the City that wants to become a pedestrian plaza partner” (i.e., be willing and able to take on maintenance responsibility with respect to the plaza) and (2) “incorporated in New York State and must have a mission that serves or relates to the geographical area of the proposed pedestrian plaza.”
  • Set forth criteria pursuant to which DOT is to review pedestrian plaza applications, including the open space needs of an area, community initiative, site context, organizational and maintenance capacity of the applicant/pedestrian plaza partner and income eligibility (low- and moderate-income neighborhoods are to be prioritized).

  • Regulate uses and activities in pedestrian plazas that are consistent with the pedestrian plazas’ designation as public space. Vehicular traffic is prohibited; activities such as events, filming, parades and others that are generally required to be permitted in public spaces are explicitly required to be permitted pursuant to the rules; littering, smoking and a variety of other activities are prohibited or regulated, including the posting of notices and signs.

    • While many of the items covered in the General Uses, Prohibited Uses and Regulated Uses are fairly routine, Section (2)(c)(2) of the proposed rules states that “[n]o person shall use a Pedestrian Flow Zone for any purpose other than the safe and continuous movement of pedestrian traffic.” This is effectively half of the language that “corrals” costumed characters into designated areas of Times Square: any areas that are designated “Pedestrian Flow Zones” may not be used for the types of commercial, solicitation, performance or expression activities generally engaged in by the performers in Times Square.

  • Allow DOT to create additional rules for specific pedestrian plazas. At this time, DOT is proposing only to codify specific rules for the pedestrian plaza space in Times Square. In particular, the rules allow DOT to designate Pedestrian Flow Zones (described above) and Designated Activity Zones, which are marked areas within which individuals may engage in “commercial activity, solicitation entertainment and performance by individuals or groups, posing for photographs or videos where any form of compensation, donation, or tip is requested or accepted, and expressive matter vending.” The objective of these two types of designated areas is to permit commercial and expressive activities only in certain areas while allowing pedestrian traffic to flow unimpeded in other areas. While Times Square is the only pedestrian plaza currently proposed to be subject to rules on Designated Activity Zones, DOT may choose to replicate these rules, or promulgate new rules, for other pedestrian plazas in the future.

DOT will be holding a public hearing on the proposed rules on May 23, 2016 and is accepting comments until that day. For any questions regarding the proposed DOT rules, please be in touch.


B Corporations and Benefit Corporations

Two distinct means of pursuing corporate social responsibility

In recent years, there has been an increasing trend toward more robust corporate social responsibility initiatives, both in response to investor and market pressures and as a wave of social entrepreneurs pioneer a new way of doing business. In particular, a variety of legal and other tools have emerged to allow companies to pay more attention to the “triple bottom line,” a set of accounting values that takes into account not only profit and other economic considerations, but environmental and social considerations as well. For those companies that wish to undertake corporate social responsibility as a core part of their business model, legal status as a “benefit corporation” and/or certification as a “B Corporation” can be a way to reflect founders’ and investors’ intent to pursue the greater good in tandem with profits.

Although benefit corps and B Corporations use similar terminology and the names are often used interchangeably (e.g., an entity incorporated under a state’s benefit corporation law is often colloquially referred to as a “B corp”), they are very different frameworks with distinct benefits and obligations.

A benefit corporation is a for profit company, incorporated under a state’s benefit corporations law, that has a legal duty to pursue certain public benefits. Thirty states currently have such laws in place, including New York, California and Delaware.

  • In New York, Article 17 of the Business Corporations Law governs the formation and governance of benefit corporations. A corporation organized under Article 17 is required to pursue a “general public benefit,” defined as “a material positive impact on society and the environment, taken as a whole, assessed against a third-party standard, from the business and operations of a benefit corporation.” New York benefit corporations may also undertake one or more “specific public benefits,” including providing products or services to low income individuals or communities, promoting economic opportunity, preserving or protecting the environment or human health, promoting the arts, sciences or advancement of knowledge, increasing the flow of capital to other benefit corporations and “the accomplishment of any other particular benefit for society or the environment.” Other legal obligations a company takes on in incorporating as a benefit corporation in New York include using specific language on all stock certificates and the filing of an annual report.

  • In incorporating as a benefit corporation, or electing benefit corporation status at any time after formation, a company can achieve the important limited liability and other protections of a corporation while baking into its core purpose a metric other than maximizing profit. This gives both principals and investors certainty that the corporation will continue to pursue its stated social or environmental mission.

A B Corporation or “B Corp” is a business -- that may or may not also be a benefit corporation under applicable state law -- certified by a nonprofit called B Labs as having met “rigorous standards of social and environmental performance, accountability, and transparency.”

  • In order to be certified as a B Corporation, a company must complete and achieve a certain score on a B Labs assessment relating to social and sustainability metrics, conform to certain legal requirements in its organizing documents, enter into a term sheet and agreement with B Labs and pay a sliding scale fee. More information may be required by B Labs, and in some states companies need to elect benefit corporation status under state law and/or amend their corporate documents to reflect certain language. Certain reporting, possible inspection and other obligations are also required to maintain certification, which must be renewed every two years.

  • Certification as a B Corporation can have significant marketing value. In B Labs’ own words, “B Corp is to business what Fair Trade certification is to coffee or USDA Organic certification is to milk.” The certification, symbolized by an identifiable logo that can be used on company materials, may send strong signals to investors and customer as they make choices regarding the businesses they choose to invest in or patronize. The certification can also help a company solidify its commitment to a social or environmental mission and plug the company into a community of socially-responsible businesses with access to benchmarking data and strategies for pursuing sustainable and responsible goals.

Legal status as a benefit corporation and certification as a B Corporation can both be helpful tools for achieving corporate social or environmental objectives. Both can also have significant marketing value, communicating to potential customers, investors and employees that the company is more dedicated than average to social and environmental goals. The tools may be used separately or in tandem, and should be thought of as two distinct mechanisms, either one of which, or both, may be right for your organization.

For any questions regarding benefit corporation and B corporation status, including formation, governance and annual reports, please be in touch.


Business Improvement Districts (BIDs): The Basics

There are more than 70 BIDs shaping neighborhoods across New York City.

A business improvement district, or BID, is a mapped area within a city in which the property owners and commercial tenants pay an assessment to finance development, maintenance and promotion services in connection with the area’s commercial activity. In the words of the New York City Department of Small Business Services, a BID is “a public/private partnership in which property and business owners elect to make a collective contribution to the maintenance, development, and promotion of their commercial district.” The services BIDs provide vary, but are supplemental to those provided by the local government and are generally aimed at promoting retail and commercial businesses within the district. To that end, they can include street and sidewalk cleaning and sanitation, landscaping, security, capital projects, fundraising and charitable events and services, marketing and business attraction.

In New York City and generally across the country, BIDs are managed by dedicated 501(c)(3) nonprofit organizations specifically established for that purpose. Because BIDs are a form of public-private partnership, they can be a good tool for combining government’s ability to impose assessments, thereby ensuring reliable funding, with a private entity’s ability to work autonomously to provide efficient, tailored and transparent services in the district. Moreover, because of the way BIDs are authorized and managed, the assessments collected from a BID’s constituents cannot be diverted to projects or matters outside the BID, protecting BID services from the uncertainties associated with funding services city-wide or from a general fund. The city council collects the assessment revenue associated with each BID and disburses it to the applicable nonprofit organization, who uses the revenue to provide services to the district.

BIDs are generally authorized by state law. In New York, BIDs are authorized and the requirements laid out in Article 19A of the New York State General Municipal Law. In New York City, the requirements regulating BIDs as authorized by the General Municipal Law are codified in Title 25, Chapter 4 of the New York City Administrative Code and each BID is actually established pursuant to Title 25, Chapter 5 of the New York City Administrative Code. As 501(c)(3) nonprofit organizations, BIDs are also governed by each state’s nonprofit laws and the IRS requirements applicable to tax-exempt organizations. As with any corporation under New York State law, each BID is overseen by a board of directors comprised of commercial property owners, commercial tenants, residents and public officials (in New York City, the mayor, comptroller and applicable borough president and city council member are de facto members of the board); a majority of the board of directors must own property in the BID.

While BIDs are authorized and established under law and by lawmakers, residents of a would-be BID do the bulk of the work required to form a BID. The formation process in New York City involves performing an initial assessment of the neighborhood's suitability as a BID, organizing a steering committee to head the effort, collecting information and conducting neighborhood outreach. The steering committee holds public meetings with area residents and prepares and refines the “district plan,” which sets out the potential BID’s services, budgets and formula for calculating assessments. When the BID has an adequate level of local support, including from the local city council member, the steering committee submits the district plan, as modified following public input, and other documentation to the New York City Department of Small Business Services. From there, the BID plans undergo a public review process that includes review by the City Planning Commission, local borough board and community board, city council, mayor and other public officials as well as a public hearing.

The BID has shown itself to be a relatively flexible tool for commercial areas in New York City. Of the more than 70 BIDs across the city that have been established since the 1980s, some, such as the Times Square Alliance in Manhattan, function as multi-million dollar corporations, taking in a projected nearly-$20 million in fiscal year 2016 and working with the New York City Department of Transportation to oversee transformative projects such as the Times Square pedestrian plazas. Others use the BID framework to oversee smaller budgets (as little as $49,740 in FY 2014 by the 180th Street BID) in order to efficiently provide sanitation, security, beautification, marketing and other BID services.

For questions about BID formation, governance and other applicable legal requirements or incentives, please be in touch.

New York City Green Infrastructure Grant Program for Private Property Owners

In 2010, the New York City Department of Environmental Protection (DEP) launched its Green Infrastructure Grant Program, which funds qualifying design and construction costs associated with green infrastructure projects on private property in New York City. The first grants were awarded in 2011.

Green infrastructure projects have been touted in recent years as a way to minimize the impacts of combined sewer overflows (“CSOs”), which result in the release of untreated wastewater and stormwater into New York City waterways when treatment plants are taxed beyond capacity. Green infrastructure can help alleviate CSOs by diverting stormwater runoff from streets, sidewalks and other nonporous surfaces into infrastructure designed to collect and manage it without sending it into the combined sewer system. New York City and DEP are currently subject to a consent order with the New York State Department of Environmental Conservation with respect to CSOs.

DEP’s Green Infrastructure Grant Program is aimed at reducing combined sewer overflows by supporting green infrastructure projects that prevent some amount of stormwater from entering the combined sewer system, thereby reducing the system’s overall load. The program encourages a variety of types of green infrastructure, from rooftop systems such as green roofs and blue roofs to rain gardens, bioswales, rainwater harvesting, subsurface infiltration systems and porous paving systems. Qualifying projects must be on private property, have design and construction costs of at least $35,000, manage a minimum one inch volume of stormwater runoff from the contributing area and be in a combined sewer area of New York City. The grant covers qualifying hard costs such as labor, materials and construction and soft costs including design, permitting and engineering services. The DEP grant will not cover costs associated with maintenance, signage, non-green infrastructure project components (e.g., roof replacement underneath a new green roof; benches or fences), legal fees and some others.

A grantee takes on significant legal obligations with respect to a project awarded a Green Infrastructure Grant, agreeing to maintain the green infrastructure project for 20 years and enter a restrictive covenant on the real property ensuring that the project will be kept in place for the 20-year period. The grantee also has the responsibility for making sure the green infrastructure project complies with all other environmental legal requirements. Moreover, by entering into the grant program, the grantee agrees that the City may use the grantee’s green infrastructure design for other projects.

DEP’s Green Infrastructure Grant Program is an exciting opportunity for private property owners to contribute to mitigating the impacts of CSOs in New York City. While there are significant legal obligations to be considered in evaluating whether to apply for or accept a grant, DEP is motivated to work with landowners to get qualifying projects in place. A wide variety of landowners might consider participating, including businesses and nonprofits with significant roof or ground space for a green infrastructure project, condos and coops with underutilized rooftops, community gardens and other property holders in a position to manage an infrastructure project, or pass it along to another manager or property owner, for 20 years. Some of the marquee recipients of the Green Infrastructure Grant include the Brooklyn Navy Yard, Queens College and the New York Restoration Project, but many projects are much smaller in scope and dollar amount (as small as $35,000).

To discuss further the requirements associated with DEP’s Green Infrastructure Grant Program, please be in touch.

Could a Shadow Review Law Protect New York City Parks from Shadow Impacts?

The New York City CEQR Technical Manual and San Francisco Shadow Analysis Program Provide Templates

One of the major amenities of our great public spaces is sunlight. While a patch of shade is most welcome on a hot July day, we love our parks for the access to sunlight they provide and the feeling of stepping out of the city that the unimpeded sunlight allows. Given our dense environment, new buildings can have the unintended consequence of altering sunlight patterns in our green spaces (not to mention streets, historic resources and even apartments), potentially harming vegetation and decreasing park usage rates. Moreover, sunlight in New York City is almost certainly a diminishing resource; so long as buildings go up at a quicker pace than they come down, shadows will increasingly cover parks, streets and buildings. They’re not easily undone.

Interestingly, New York City does not directly regulate new shadows. Certain zoning requirements are meant to limit the impact of shadows and the 1916 New York City zoning code was initiated, at least in part, in response to the seven-acre shadow cast by the then-new Equitable Building. Though the zoning code has been amended in the intervening years, building height restrictions and design requirements in the current zoning code continue to address shadows indirectly; for example, the height restrictions for buildings on wide avenues in many areas tend to be higher than those for buildings on surrounding side streets, as wider avenues allow for more sunlight relative to building size. Civic groups have also played an indirect and unofficial role in keeping shadows in check. In particular, the successful 1980s fight spearheaded by the Municipal Art Society over the Columbus Circle project that later became the Time Warner Center is now the stuff of city planning lore, thanks to the 800 protesters, Bill Moyers and Jacqueline Kennedy Onassis among them, that used hundreds of black umbrellas to simulate the projected shadow of the planned building.

The world has changed since 1916, and even since the more recent amendments to the zoning code. While zoning regulations aimed at minimizing shadow impact are still in effect, building technology and market mechanisms have evolved to allow taller buildings in places not previously anticipated. As Council Member Mark Levine, Chair of the Parks and Recreation Committee, put it, “in recent years a combination of transferable development rights, zoning lot mergers, and new building technologies have enabled super-tall structures that would have been inconceivable a half century ago--effectively rendering previous zoning laws impotent.”

In light of these developments, as well as a handful of new or planned “supertall” towers on the blocks just south of Central Park, the Municipal Art Society has been active once again. They have done extensive analysis of the impacts of the shadows from these new high-rise buildings in connection with their 2013 “Accidental Skyline” work and provided testimony on behalf of a 2015 New York City Council bill for the creation of a task force to study the effect of shadows cast over public parks (the bill remains in committee as of today). MAS recommends potential solutions to minimize new shadow impacts, including new zoning, height and building setback requirements and a public review process for buildings that would cause new shadows over parks.

Though a review process has the potential to lack teeth (depending on whether the review process is designed to actually prohibit new buildings that would have significant shadow impacts, require or incentivize mitigation in such cases or merely give notice and consideration before allowing construction to proceed), implementing one would be relatively straightforward, as frameworks have been put in place in other contexts or jurisdictions. Moreover, the process is flexible, both on the design end and in allowing for review of projects or types of buildings that we may not be able to foresee today. There are at least two potential models in place for a New York City shadow review process:

  • For one, a New York City Environmental Quality Review (“CEQR”)-like process could be expanded to cover all projects that lead to new shadows, not just those subject to CEQR because they involve a public approval, funding or other “action.” The CEQR Technical Manual already has clear, if case-by-case, thresholds for reviewing shadow impacts and proposes mitigation solutions. As under CEQR, new buildings or other construction projects could be required to perform a shadow assessment (including computer modeling of shadow impacts) if they would result in new or increased structures of greater than 50 feet in height or if they would be located adjacent to or across the street from a public park or other sunlight-sensitive resource. A “significant” shadow impact determination, with its attendant mitigation requirements, could be found for any “incremental shadow of 10 minutes or longer” with impacts to vegetation, open space or other defined sunlight-sensitive resources. The CEQR Technical Manual also suggests potential shadow impact mitigation strategies, including modifications to building height, shape, size, location or orientation and relocation or redesign of sunlight-sensitive resources or features.

  • The San Francisco, California Shadow Analysis Application provides an alternative approach. That program, administered in connection with San Francisco’s zoning code provisions that regulate shadows cast over city parkland, requires any new structure or building addition that will top out over 40 feet to prepare a “shadow fan” diagram showing the maximum reach of building shadows throughout the year. A shadow fan showing that the new building's shadow would reach protected park space would be flagged for further review, including a potential Planning Commission hearing.

In designing a shadow review process, New Yorkers would have to decide certain threshold questions: When do we want to require review? For any building above a certain height? For buildings taking advantage of zoning lot mergers? What resources do we want to protect? Certain, specified parks only? All New York City parks? Other, non-park resources as well? For example, CEQR protects certain historic resources (with sunlight-sensitive features), but not city sidewalks (so that always-used bench outside the local coffee shop with great morning light wouldn’t be protected). And how much new shade is too much? The CEQR Technical Manual puts forth 10 minutes as a relevant, though not determinative, threshold, but perhaps the amount would vary depending on the resource. Any of these parameters could be integrated into a new shadow review process using the CEQR or San Francisco frameworks. Finally, the designers of the shadow review process would need to consider whether and how the process would withstand legal challenges, including due process, takings and vested rights challenges.

It’s worth noting that a shadow review process is not the only way to go -- other jurisdictions regulate shadows more directly. Massachusetts has had a law on the books since 1990 protecting Boston Common and, later, the Boston Public Garden from the impacts of new shadows (though multiple attempts to expand this protection to other public parks have been unsuccessful). And San Francisco’s regulation is more sweeping than just a shadow review process; the zoning code in that city generally prohibits new buildings of greater than 40 feet in height that cast “significant” shadows on park land and has been used to oppose or strike down proposed projects. Moreover, architects have developed new ways to build larger buildings while lessening impacts to light, and it’s possible that some will be codified into future zoning regulations.

New York wouldn’t be New York without an ever-changing skyline. It also wouldn’t be New York without passionate citizens questioning development decisions. A shadow review process would weave together both of those important strands, allowing for development to occur in a way that preserved our access to sunlight in public spaces. New Yorkers are already comfortable with public review processes, and a shadow review is such a process with substantial precedent here and elsewhere. Moreover, the design of the shadow review process would allow for stakeholders to have a voice in articulating what factors matter to them in reviewing shadow impacts going forward.


Note: I would be remiss in not pointing out how helpful I found the Municipal Art Society’s “Accidental Shadows” portal (report found here) and a May 4, 2015 Washington Post article by Emily Badger in understanding this issue.