corporate communication

After Amazon Loss, Economic Development Corp. Hired Big Guns for Local Battles

EDC President James Patchett during City Council testimony with Amazon executives on Dec. 12, 2018.
EDC President James Patchett during City Council testimony with Amazon executives on Dec. 12, 2018. Photo: William Alatriste/City Council Flickr

Just a dozen days after Amazon announced this winter that it would pull out of plans for a Queens headquarters in the face of raucous opposition, the local authority that had helped forge the deal sought help from a familiar face, emails obtained by THE CITY show.

Andrea Hagelgans, the de Blasio admininistration’s former communications chief, got a message from the NYC Economic Development Corporation chief of staff James Katz on Feb. 26 requesting a phone call about a “potential engagement.”

That engagement — cemented in April at $80,000 for four months’ work — was a reputational rescue led by Hagelgans at the public relations firm Edelman, which she’d joined in 2018 after leaving her City Hall job.

Her team signed up to lead a course correction in Amazon’s aftermath, the correspondence shows. It would enhance EDC’s existing press operation, rehabilitate the corporation’s wounded image and win future land-use fights against community and political opponents.

EDC spokeswoman Stephanie Báez characterized the hiring of Edelman as nothing out of the ordinary. “EDC carries out dozens of complicated projects that require time and attention,” she said. “As in the past, we’ve taken the straightforward step of engaging outside help to assist with capacity and strategic support.”

She did not answer questions about total billing, whether the contract would be extended or renewed or if the work was ongoing.

Edelman declined to comment.

Gearing Up for Future Battles

As part of its mission to generate jobs and revenue for New York City, the quasi-public EDC doles out public property and aid to private developers for real estate projects. Some depend on politically controversial land use approvals that require winning over community and City Council support.

That was the case with Bedford Union Armory, a massive apartment and recreation center project in Brooklyn’s Crown Heights, currently under development by BFC Partners. EDC secured Council approval in 2017 despite vocal local opposition, but only after adding public dollars to the project and making other concessions.

EDC had never pushed a project quite as explosive as Amazon HQ2. When Amazon last November announced its intention to locate in Long Island City with the help of city and state tax breaks and other aid, left-leaning local groups and elected officials began to attack on multiple fronts — and the company shrank away.

The Edelman proposal from March, released to THE CITY under a Freedom of Information request, describes EDC’s “most urgent needs” as “capacity building and the preparations needed to weather and win critical land use fights.”

“We have designed a program that we believe meets your immediate needs while propelling NYCEDC forward as you work to shape the future of NYC for its residents,” Hagelgans wrote in an email to Katz.

The proposal also aimed to elevate EDC President James Patchett in the public eye, “building executive visibility.”

The objectives included positioning Patchett “as a fierce advocate for business growth and development,” and creating a “playbook outlining a strong defense to political or community-related attacks surrounding high-profile land use fights and other reputation risks.”

The strategy involved a “systematic, rapid-response approach to effectively navigate political and community-related opposition that could slow or stall progress” on such deals.

One tactic would take advantage of poll data from The Edelman Trust Barometer, which is “launched annually at the World Economic Forum in Davos, Switzerland.”

Controlling the Message

Edelman staff also told EDC it would attend public meetings, arrange sit-downs with reporters and help place “think pieces” for a “controlled platform on which to share NYCEDC messages,” according to the proposal.

The company would further recommend ways EDC could pay for advertising and sponsorship.

The “stories we want to tell” section of the proposal is redacted in its entirety.

Letters of agreement were quickly drawn up, and Katz looped in another consultant, Blake Zeff, who was tasked with “doing a deep dive with our staff and drafting an initial comms plan for EDC.”

State Sen. Michael Gianaris at an anti-Amazon rally in front of City Hall last winter.
State Sen. Michael Gianaris at an anti-Amazon rally in front of City Hall last winter. Photo: Senator Mike Gianaris via flickr

Katz wanted to make sure Zeff would work on publicizing the need for EDC more generally — “core branding” — possibly by capitalizing on the threat of economic recession.

The five-person Edelman team would focus on day-to-day press work, an initiative related to business incubation and an “in-depth assessment of risks related to high-profile land use fights and other reputational challenges.”

In April, Katz signed a deal for work through July totaling $80,000, including $420-an-hour billing for Hagelgans.

Not Buying It

Key Amazon opponents responded to the EDC public relations push with renewed frustration at what they described as a disconnect between the corporation and community.

State Sen. Michael Gianaris (D-Queens), whose opposition to the Amazon deal combined with his position on a state decision-making board precipitated its demise, said EDC’s public relations efforts, and the money backing them, are misplaced.

“It’s the job of public entities like EDC to listen to communities, not to hire people to fight against them,” Gianaris said. “It’s indicative of the problem that existed from day one, that rather than have real engagement with the community, they signed a non-disclosure and they somehow  think the problem was that they didn’t adequately convince people that the community is wrong.”

“If the lesson they’ve drawn from all this is that they didn’t spend enough time trying to manipulate the community to agree with them, then that speaks volumes about why this thing went sideways to begin with,” he continued.

Deborah Axt, co-executive director of Make the Road New York, which also fought the deal,  said the hiring signaled that the de Blasio administration’s plan post-Amazon is “to shove those deals down our throats with more finesse.”

“It felt like when Amazon changed course, that the de Blasio administration had learned something about errors made in this process, so we’re disappointed to see these maneuvers.” she said.

“Community engagement is not a PR firm mobilizing what looks like grassroots support,” she added. “Community engagement is actually engaging meaningfully with real community organizations on the ground and re-envisioning the way that economic development could benefit those communities.”

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