20140609-NEWS--0001-NAT-CCI-CN_-- 6/6/2014 5:33 PM Page 1 HOUSE CROWD Builders seek piece of mayor’s affordability CRAIN’S® push P. 3 NEW YORK BUSINESS VOL. XXX, NO. 23 WWW.CRAINSNEWYORK.COM JUNE 9-15, 2014 PRICE: $3.00 Maximum worry on minimum wage hike Small businesses warn of layoffs, higher prices if city rate goes HARLEM PLIGHTS: to $13 or even more Karen Martinez (upper right, with her Harlem neighbors) has been BY ELAINE POFELDT trying to get FiOS broadband and TV for City Council Speaker Melissa Mark- her East 130th Street brownstone since 2012. Viverito’s proposal to nearly double . the city’s minimum wage to $15 an hour,up from the current $8,would hit small businesses and their customers hardest, forcing them to raise prices, lay off workers, and move or outsource operations outside the city, according to owners, advisers to small firms and lead- OWNERS ers of the small- FEEL THE business community. MIDDLE- Zane Tankel, the CLASS chief executive of SQUEEZE Apple-Metro, which SMALL BUSINESS owns 40 Applebee’s REPORT restaurants in the P. 15 New York area, said he’d likely close about 10% of his stores or those that are less profitable if the minimum wage were raised to $13 or more. “Our marginal stores would have to be re-evaluated,” said the restaurateur, the largest franchisor of Applebee’s in this region. Ms. Mark-Viverito said last Tues- day that New York City should follow Still waiting for FiOS Seattle’s lead and raise the minimum wage to $15. Her comments followed Why Verizon will miss deadline for all-city broadband access Mayor Bill de Blasio’s observation a day earlier that Albany should raise the state’s hourly minimum to $10.10 and CROSSED For a variety of reasons, some beyond the compa- BY MATTHEW FLAMM WIRES allow the city to enact a local rate 30% ny’s control, Verizon has come up short on both higher, which Gov. Andrew Cuomo Verizon Communications promised in a 2008 fran- THIRD IN AN obligations, raising the possibility that many neigh- pledged to fight for in his deal with the OCCASIONAL chise agreement with the city that it would wire every SERIES borhoods will continue to be stranded on the wrong Working Families Party to run on its corner of the five boroughs with fiber-optic infra- side of the digital divide. ballot line this November. structure by the end of June 2014. It also pledged, The telecommunications giant cites 2012’s Su- The Legislature would have to ap- once its FiOS network was in the street, to deliver its high- perstorm Sandy—which forced it to replace much of its prove such a measure.That has height- ened the stakes for the state Senate— speed broadband and television service to any customer who downtown copper infrastructure with fiber—and Hurricane controlled by a coalition of See VERIZON on Page 25 asked for it, within six months to a year. Republicans and breakaway Demo- crats—and for November’s elections. buck ennis See MINIMUM WAGE on Page 28 23 5 THE LIST NY AREA’S TOP AIRLINES P. 17 NEWSPAPER 71486 01068 0 20140609-NEWS--0002-NAT-CCI-CN_-- 6/6/2014 5:34 PM Page 1 EDITOR’S NOTE Wage rage FYICRAINSNEWYORK.COM Much of our newsroom spent last Tuesday morning in Queens with Borough President Melinda Katz Brooklyn’s former DA may and more than 30 local business have broken campaign laws owners and executives who shared with us their top concerns about he political world was taken aback by a running a business in New York report that former Brooklyn District City. I still can’t shake the deep Attorney Charles “Joe” Hynes (pictured) Glenn Coleman T frustration in the voice of Amparo used money seized from drug dealers and other Connors, the president of Allied criminals to pay a campaign consultant during Personnel Services Inc., as her litany of expanded his failed re-election bid last year.The 2013 DA government mandates piled up: paid sick days for race was won by Kenneth Thompson. ¶ The newscom the temporary office workers her Forest Hills firm report—completed by the city’s Department of Investigation, led by Mark Peters, who lost the supplies to small and large companies; the pages of 2005 Democratic primary to Mr. Hynes—also found that the ex-DA enlisted his staff for paperwork in multiple languages per employee to campaign duties and used his office email account to conduct his campaign, both violations of comply with ever-stricter wage-and-hour laws; the the City Charter. ¶ But longtime observers of Mr. Hynes were not shocked. During the race in pluses and minuses of the federal Affordable Care 2005, candidate Arnold Kriss criticized Mr. Hynes for accepting campaign contributions from his Act; and now, talk of a city minimum wage of $13 to staff.The incumbent claimed he had stopped the practice. Mr. Kriss also documented Hynes’ $15 an hour. “I can’t make it if that happens,” Ms. staffers distributing campaign literature from government vehicles. ¶ “Nothing was done in 2005 Connors said, noting that hers is the last woman- to clean up this toxic political waste dump,” said Mr. Kriss, a criminal-defense lawyer and former owned employment agency standing in an office Brooklyn assistant DA. “This is a real tragedy for the institution of the Brooklyn DA’s office. ¶ complex that used to house several of them. “I can’t Felony charges could be brought against Mr. Hynes for paying public-relations professional pass those costs on to my customers. I sure can’t Mortimer Matz more than $200,000 with asset-forfeiture funds. ¶ “I don’t think we’ve even seen afford them. Maybe the Robert Halfs of the world the middle of the iceberg yet,” Mr. Kriss said. “We’re past the tip, though.” —erik engquist can, but I can’t.”This happened hours before City STARTUPS GO TAX-FREE. Two biotech vestor, who could have bought the Council Speaker Melissa Mark-Viverito suggested firms are among the first beneficiar- property at a foreclosure auction. … HOORAY! hearings on the idea of a $15-an-hour minimum ies of Gov. Andrew Cuomo’s Start- NYCHA SECURITY CAMERAS. The fa- BRONX wage here. Reading other media outlets’ coverage, I Up NY program, which allows tal stabbing of a 6-year-old boy and BREWERY will companies to relocate their head- the wounding of a 7-year-old girl in start making was struck by how little time their reporters spent beer in its quarters to the state to enjoy a tax- the Boulevard Houses public-hous- home borough interviewing actual businesspeople. Plenty of noble free existence for 10 years. Ameri- ing complex in East New York, after three fast-food workers hungry for a 60%-plus raise, and cord Registry, a cord-blood bank, Brooklyn, prompted Mayor Bill de years in Wisconsin and of course the usual activists and economists, but few will open a lab inside the biotech in- Blasio to order the installation of se- Connecticut. cubator on SUNY Downstate’s curity cameras at 49 public-housing of the folks who’d have to figure out how to pay their campus in Brooklyn, while developments by the end of the year. entry-level and low-skilled workers $15 an hour. synthetic-meat company Modern The cameras were approved and bronxbrewery.com That’s why we have a news story on Page 1 that Meadow will move into the Bio- funded with $27 million almost a explores the potential business impact of Ms. Mark- BAT incubator in Sunset Park, year ago, but installation work nev- OY VEY! Brooklyn. … SODA BAN FIZZES UP er started. … CABS FOR THE DIS- Viverito’s proposal. Will she devote as much time to MORE THAN 100 GANG MEMBERS AGAIN. The de Blasio administra- ABLED. The city’s Taxi and Limou- were busted in Harlem in the largest such hearing out the likes of Ms. Connors as she does the tion urged the State Court of Ap- sine Commission will increase the case in city history. other side? Wouldn’t that be something. peals to overturn a number of wheel- lower court’s deci- ‘Don’t shop chair-accessible sion that blocked the taxis nearly twenty- THIS WEEK IN CRAIN’S city’s proposed ban there for fold, to 16,500, in on large sugary the next decade.The drinks last year. The anything until plan also boosts the IN THE BOROUGHS-------------------------- 3 city said the prohibi- this is settled’ number of green IN THE MARKETS---------------------------------- 4 tion, championed by —Author Sherman Alexie, cabs that will be out- former Mayor THE INSIDER -----------------------------------------------6 speaking to Stephen fitted with ramps to Michael Bloomberg, Colbert, on how consumers 50%, from 20%, in focus on investment in companies BUSINESS PEOPLE --------------------------- 8 would help fight the can end the Amazon- the same time where women make up a significant SANDY REAL ESTATE-------------------------------------------11 obesity epidemic. Hachette dispute on e-book frame. … portion of officers and directors. … Opponents call it an pricing FUNDING.The feder- RANGERS FEVER. Last week, the OPINION --------------------------------------------------------12 overreach of the al government plans Rangers faced off against the Los GREG DAVID--------------------------------------------13 city’s authority. … to give $920 million Angeles Kings in L.A. in the STUY TOWN OWNERSHIP. CWCapital to six projects that will protect New Blueshirts’ first appearance in the REPORT----------------------------------------------------------- 15 Asset Management,which has con- York and New Jersey from future Stanley Cup final in 20 years. The THE LIST ---------------------------------------------------------17 trolled Stuyvesant Town-Peter storms.… NEW WOMEN’S FUND.