Patrons gather outside of Neir’s Tavern on Saturday, Jan. 11, 2020, in the Queens borough of New … [+]
Correction: The article originally misstated when Loycent Gordon used the Commercial Lease Assistance Program.
At a moment when thousands of small business owners are seeking free legal assistance to negotiate with their landlords, New York City is proposing to cut the funding for the Commercial Lease Assistance Program (CLA Program) in its entirety.
“This literally is an indication of how the City doesn’t value small business,” says Tammeca Rochester, 38, owner of Harlem Cycle. Rochester, a return client, has relied on the program in the past few weeks to review her two commercial leases and to understand her options as she faces difficultly meeting rent, she says. Her small business, a fitness studio in Harlem, has been closed for more than two months.
The CLA Program, which is the City government’s only full-service legal assistance program for small businesses, funds the work of ten attorneys at three legal firms who advise small business owners that are POC, female, immigrant, and/or low-income on negotiating their leases. The firms field requests including lease renewals, breaches of contract, rent abatement, landlord repair demands, and payment plans. The program will be cut in the City’s Fiscal Year 2021 budget if no changes are made to restore funding before June 30th. The attorneys have already stopped taking new clients, working to complete existing matters with clients, until they know the status of the program.
“This defunding comes at absolutely the worst time,” says Meah Clay, an attorney and Director of the Community and Economic Development Program at Brooklyn Legal Services Corporation A (Brooklyn A). The three legal firms participating in the program, Brooklyn A, Take Root Justice, and Volunteers of Legal Service, have seen 10 times the number of requests for legal aid since businesses were ordered to close in mid-March due to COVID-19.
At this point, “the focus of every call [from small business owners] is survival” says Clay.
If a small business cannot negotiate rent with their landlord it is a whole economic ecosystem that suffers, including not only the small business owner and their landlord, but also their respective families. “You destroy a small business you destroy many lives, immediately,” says Kenrick Ross, the Program Manager for the Small Business Support Project at Brooklyn A.
The City’s budget for Fiscal Year 2021 includes $2.7 billion in cuts, with more to come, compensating for a forecasted $9 billion decline in cumulative tax revenue due to COVID-19, according to a spokesperson for the Mayor’s Office. In 2020, the Small Business Services’ adopted budget was $236 million, of which $1.2 million went towards funding the Commercial Lease Assistance Program.
The CLA Program is a little over two years old, and forms part of Mayor Bill de Blasio’s initiative to support the small business economy in New York City. The program is designed to support those with the highest need. The program’s three firms report their clients are 99% low-income, 75% people of color, 64% immigrants, and 51% women. It also prioritizes small business owners renting commercial space in areas that have been re-zoned recently or are slated to be rezoned soon, and those whose lease is set to expire soon. In using these criteria, the program supports certain small business owners overcome the hurdles of high rent, bureaucracy, and discrimination that might have prevented them from establishing themselves as small business owners in the City. The benefits of the program extend to employment, financial security, and diversity of tenants within the City.
Tammeca Rochester relied on the program when she was opening her second studio. Through consulting with a lawyer she was able to negotiate the taxes and legal liability that would fall on her as a commercial tenant.
“The lease was almost 200 pages. Just opening the document made me stressed. I knew that in those 200 pages nothing would be in my favor,” she says. “The lawyers from Brooklyn A went through the document line by line,” she says. They told her: “this is something you can give in on, this is something you should never ever give in on.”
Loycent Gordon, owner of Neir’s Tavern, poses for a portrait Saturday, Jan. 11, 2020, in the Queens … [+]
Loycent Gordon, 40, owner of the historic landmark Neir’s Tavern in Queens, relied on the program to negotiate his rent when the building was sold two years ago. The new landlord wanted to triple his rent, making it so high above market value to be predatory, says Gordon.
“They told me: you have rights. That was the beginning of self-empowerment, [and] that’s what I appreciated,” he says.
Gordon was able to negotiate the rent amount, the real estate taxes, and the personal guarantee. Without the program, he would not have been able to afford the cost.
“I didn’t have the resources to negotiate properly,” he says. “People with the money get the best advocacy.”