Bill Aims to Help Small Businesses Survive

At 3:30 p.m. on a Thursday afternoon, G&G Variety store has made less than $70 profit. The day before, Adikie Addy, the store’s owner and cashier, counted a total of $165 in earnings. At the end of the week she has to pay her landlord $1, 000 in rent and arrears payments.

“I cry, I pray, but it’s tough,” Addy said. Along with her business partner, Addy opened the store, less than a block away from the intersection of White Plains Avenue and 233rd Street, almost three years ago. She said her rent began at $2,080 and has increased to $2, 165. Hit hard by the economic recession, her business has suffered, and she has yet to record any gains from the store. In the last few weeks she said she has tried to negotiate, but  her landlord, has taken her to court instead.

“I called him, I pleaded with him to come down a little bit,” Addy said. “I said to him, ‘It’s not your fault nobody knew the economy would be like this.’ ” She said her debt to her landlord has climbed to more than $8,000, including costs of maintenance and taxes, which are divided among the five other store owners in this commercial building.

The landlord, Jeffrey Cohen, declined to comment. “That’s between myself and my tenant,” he said when asked about rent disputes with Addy.

Last week, City Councilman Robert Jackson introduced the Small Business Survival Bill, which if passed, would  give business owners like Addy the right of arbitration to more effectively negotiate their leases.

“Small businesses right now have no say whatsoever in the terms of their lease, so when the lease term comes up, the landlord has total say,” said Robert Bieder, chairperson of the Bronx Merchants Coalition and a member of the Coalition of Small Businesses. “Simply put:  It is the right to arbitration in the commercial lease renewal process,” Bieder said of the bill’s potential power.

Addy said she wished there had been such a program in place when she signed her five-year lease. Instead, she said, she took the word of her landlord, who ran the shop before her, and convinced her that she would be making a profit that would cover her expenses. With four rows of shelves cramped into just about 120 square feet, the narrow store stocks everything  from underwear to detergent and even traditional clothes from Addy’s native Ghana.

Addy said she had taken out more than $50,000 in loans to keep her business afloat. She works night shifts as a hospital nurse technician so that she can pay her debts.  “My pay was five hundred and forty-something dollars, ” she said of her most recent paycheck. “I took $500 to pay for the merchandise. I don’t have money in the bank. It’s about time we were helped, we put money into this economy.”

Cohen also declined to give his opinion on the new bill or what it might mean for his commercial properties.

Local activists are  already trying to mobilize small businesses to gather enough support for the bill. But this is not the first time the bill has been up for debate.  Last year, District 7 Councilman Robert Jackson brought it to the floor. By the end of  the City Council cycle in December, however, the bill had not been voted on and withered away in the political process.

New York City Council Speaker Christine Quinn argued that she could not support a bill that she felt was fundamentally illegal. Last year, Quinn said that forcing landlords to binding arbitration would encroach on their property rights, according to the Downtown Express. At the Bronx Chamber of Commerce’s monthly luncheon in early April, Quinn’s position had not changed. “I can’t say I’ll pass a bill that so many of our staff and our highest lawyers say cannot be legal,” Quinn said. Instead, Quinn said that the council was looking into alternative legislation to protect small businesses in the city.

Jackson said he believed that opposition from the mayor’s office and pressure from the real estate lobby prevented the bill from being passed last year, even though 34 out of 51 council members  supported the bill. “In the last cycle, when push came to shove, there were not enough votes to move it,” said Jackson. “There [was] a lot of pressures put on a lot of people.” This time Jackson intends to build support “from the ground up.”

Steve Null, a former business owner and activist for the Small Business Survival Bill, said the stalling was political. “Our attorney thinks it’s a red herring,” Null said. “It was a last-second move to stop the bill.”

Null said his attorneys had provided Speaker Quinn’s office with the necessary documentation to prove the legality of the bill. He said his calls for a forum to assess legal issues surrounding the measure were ignored.  “They stopped the bill because she does not want to regulate the landlords,” he said.

Some sources alleged that Speaker Quinn may have rejected the bill because it is in her own political benefit to maintain the real estate lobby of landlords. Speaker Quinn’s office responded to this  by reiterating her December 2009 position. “Council Member Jackson’s legislation before the council, while well intentioned, is not within the council’s power,”  Quinn’s office said in a written statement. The statement suggested alternative legislation that would create a unit within the City’s Small Business Services that would assist in lease negotiation.

In an effort to bring attention to the need for such a bill, the U.S.A Latin Chamber of Commerce surveyed 937 Latino-owned businesses in New York City from November 2008 to January 2009. More than half of all businesses surveyed, both professional services, such as attorney and accounting offices, and smaller “mom and pop stores,”  like corner bodegas and hardware stores, complained that their businesses ran the risk of closing because of high rents and operating costs.

Almost three quarters of the small business owners in the survey said they would have to cut back their workers’ hours because renting their storefronts was too expensive.

“The mom and pop stores are at the heart of those communities; they support your Little Leagues, they support your church groups,” said Bieder, who owns Westchester Plumbing Supply with his two younger brothers. “We need to help them stay in business. There are tenants that have been here for 40 or 50 years,” Bieder said. “Now there is a vacancy problem due to lease negotiations. We’re losing about 8,000 a year.”

For now Addy is determined to keep her store open. “It has become a burden on us, but we are going to pay him for five years,” she said.

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