Chinatown in the 21st Century – Local Business and the Development of Chinese American Community

Thomas Tam: Local businesses have always been a very important component of community development. They improve employment, housing situation, and enhances the quality of life. From this perspective, what are the most urgent issues facing Chinatown?

John Wang: Chinatown suffered as a result of 9/11. Business in general has suffered a great deal. Some lost as much as 50-60% of their regular business. The garment industry, main employer in Chinatown, lost thousands of workers. At least 20% of the factories closed as a result. Some of the smaller businesses also are not doing well, because visitors are not coming or they are not spending as much as they used to be.

9/11 certainly has a lot to do with the economic decline of Chinatown, but we have seen the decline of Chinatown prior to 9/11. Let’s review a little. In the 70’s and 80’s we saw a tremendous growth of Chinatown. From the traditional area, bounded by Bowery, Canal, Baxter and Worth streets, it expanded to all corners of the Lower East Side: as far north as Houston Street, in the west all the way, to Broadway, and in the east, all the way to the East River.

As a result of immigrants settling in Chinatown, many of the stores previously closed have been reopened. In the 80’s, with the continued influx of immigrants overcrowding Chinatown, many of the newer immigrants moved into Flushing to start a new community there. In the late 80’s and early 90’s, a new Asian community is formed in the Brooklyn neighborhood. Then, in the mid to late 1990’s, internet related companies were expanding all over the place. Chinatown was under increasing pressure because the businesses were small, operated in very traditional ways, and totally out of sync with the new economy.

The new economy’s expansion has infringed on Chinatown and forced its contraction. Many dot-com companies came downtown looking for cheaper space. They pushed out the manufacturers and the rent went up. All of that contributed to the decline of the Chinatown community. When 9/11 hit, it pushed the community all the way down to the bottom.

The basic business infrastructure in the community is weak, and that makes it very difficult for small businesses to grow. They don’t have the knowledge, the financial resources, and the skills to develop their business. Manhattan is one of the highest rent districts in the country; in the world, for that matter. The cost of doing business is very high. For a lot of those small businesses, it’s difficult to survive. At the Asian American Business Development Center, we are assisting a lot of small businesses in the community to apply for grants and loans after 9/11. The result was very disappointing. The average business received less than 3000 dollars in what they call Business Recovery Grant. There is a huge disparity between grants awarded to Chinatown businesses and businesses in lower Manhattan as a whole. There are reasons behind that. They require documentation, which a lot of Chinatown businesses don’t have. One of the criteria for receiving Small Business Retention and Attraction Grant requires a five-year lease commitment. Many businesses have been in Chinatown for years, but the landlords just don’t give them a five year lease. As a result, they are not qualified for those grants.

It is important to strengthen the basic business infrastructure, upgrade the business operation, and to manage the business better. Chinatown businesses must market their products and services better by also bringing up the quality of the goods and services that they have to offer. Chinatown certainly has a reputation as a low-cost community where goods and services are far below city average. If the quality of those products is inferior, that would not attract more customers to the area.

Chinatown should move away from traditional businesses which lead to dead ends. They should start looking at new business opportunities that China has to offer. There are tremendous opportunities for smaller businesses to link up with China based on the growth of its economy. That’s certainly one way to lead those small businesses into new development.

Chinatown businesses can develop into cooperative type of venture with other businesses that can take them to a new level. Certainly, public support should provide technical assistance to local businesses and to enable them to flourish.

Thomas Tam: Sure. We’ll talk more about the infrastructure in Chinatown, but we want to go on to Jerry and to talk about the transportation plans for Chinatown for its development. Since 9/11, there’s money coming into lower Manhattan. What is happening to transportation issues that affect Chinatown?

Jerry Cheng: Traffic congestion and parking shortage have a very negative impact on the healthy development of Chinatown. Chinatown is one of the oldest neighborhoods in Manhattan. All the streets are narrow, the sidewalks are narrow, and some of the streets are not going through. That makes traffic circulation very difficult. That’s why the Chinatown traffic problem is more serious than other areas.

Another reason is the location of Chinatown, between Holland Tunnel and three major East River bridges. The already heavy traffic between New York and New Jersey, through the Holland Tunnel, was exacerbated when one way toll was implemented at Verrazano Bridge almost ten years ago. As you know, a lot of traffic originally went through Verrazano bridge to Staten Island, before it gets to New Jersey. Now, because you have to pay a double toll, they just go through Chinatown, using Holland Tunnel.

A lot of people probably are not aware that Canal Street is one of the three major thru-truck roads in Manhattan. That’s why we have so many trucks on Canal Street. Traffic congestion is also caused by the business of passenger carrying vans, shuttle buses, and long distance buses that are parked in Chinatown. They not only use the meter space, but the space for truck loading and unloading as well. This causes major traffic congestion. After they parked, the trucks cannot park at the assigned space so they double park, and cause traffic congestion.

We have a very large volume of pedestrians. At all the intersections, pedestrians and vehicular traffic always conflict. Added to the problem are street vendors. As you know, some of them are legal, some of them are illegal. They made it impossible for anyone to go through the sidewalks.

The shortage of parking space has a major impact for business development in Chinatown. This is a common problem in New York, but worse in Chinatown. Parking shortages are caused by the construction of new buildings in the past three decades. All these lost parking facilities have never been replaced. For instance, the City Detention center, next to the City Criminal Court, was originally a major parking garage. Since construction, no parking garage has been replaced. Similarly, once the federal courthouse it was built, all these original parking lots there were not replaced. The most important parking garage was under the police plaza. That’s a major parking facility for Chinatown, not only because they have enough capacity, but the price is also very reasonable for short term parking. That meant shoppers, tourists, and restaurant goers have access to enough parking spaces when they come to Chinatown.

Unfortunately, after 9/11, the police plaza parking was closed, and has never been replaced. Another reason for the shortage of parking space, cited by a lot of Chinatown businessmen and residents, is the illegal parking by law enforcement personnel. That’s a very serious problem. I have some proposals. We need to have more short-term parking. Three hours is enough. If you create a lot of those short-term parking, it means that people cannot stay there for the whole day, but it is time enough for business, restaurant or shopping.

There are many streets surrounding Chinatown. At night, they are open to parking. The bad thing for a space open for parking without limits is that once someone parks there, you’ll have no turnover. In Midtown Manhattan at the theater district, recently they put meters, so you can only pay for a certain number of hours. In this way, they created a lot of parking spaces for theater goers. Same thing can be done for streets near Chinatown. If you install a lot of that kind of meters in Chinatown, it will help a lot of business.

There are only two major transportation projects in Chinatown. Between 1972 and ’75, MTA built a 700 foot section of subway tunnel under Confucius Plaza. That’s a major transportation construction in Chinatown that is sitting unused for thirty years. Another one is the recently completed Chatham Square improvement. The original purpose for that project is to simplify the intersection and create more pedestrian space. As we know, any traffic improvement project always brings in some other side effects, and no project can please everybody. As far as I can observe, this project helped Chinatown a lot.

Under the new plan, I propose to have a triangle, a kind of pedestrian mall for vendors. If you come into Chinatown, from Canal Street, you will see a triangle island. The plan is to expand that area and connect that island to the sidewalk. Thirty years ago, we have a “Mastery Pedestrian Mall” plan for Chinatown. Originally, I thought it was a very good idea to make Chinatown into a pedestrian-friendly environment. That means all the tourists and shoppers can just walk on the street and not have to worry about the vehicular traffic. Mayor Koch was the mayor at that time. He even walked through the streets to show how nice the mall would be. It turned out that the merchants opposed it, so we didn’t go through with the plan.

Thomas Tam: We’re going to open up the discussion to the audience. Before that, I want to ask John, since you wear so many hats and you’re involved in tourism development in Chinatown do you want to comment on the things that Jerry has said?

John Wang: Well, I’m intimately familiar with the Chinatown Street Revitalization study.

Jerry Cheng: Actually, John did work at City Planning a long time ago.

John Wang: It’s a credit to Jerry to recommend those ideas and proposals to improve Chinatown’s streets, but it’s a sad commentary for the community that, after 30 years, only one of the recommendations was finally implemented. That says a lot about the community; that says a lot about the public sector and how they treat Chinatown. That has always been an issue. After 9/11, talked about how much attention is paid to the community, and how much of Chinatown is incorporated as a part of the lower Manhattan development. In some ways, the public sector had to take Chinatown into some consideration. Certainly, it’s not enough. There are some efforts to assist Chinatown, but greater effort and resources need to be directed to help the community.

The curb in Chatham Square, a major improvement in terms of traffic and safety for pedestrians, took 30 years to implement. Does it require another 30 years before a few more parking spaces will be added to Chinatown? That’s a question we all have to ask. We also need to do something about it.

Betty Lee Sung: John Leo is here. He’s in charge of the tourism project and the liaison for the Lower Manhattan Development Corporation. Do you want to ask him about it?

John Leo: I wouldn’t say I am in charge of it, but I am familiar with the project and some of the other transportation projects that LMDC is undertaking to help Chinatown’s congestion problem.

As far as LMDC is concerned, we are definitely listening to what the community needs. We are doing a lot of different projects. One of them was the Chinatown Access and Circulation Study, which is coming into its final phase. In fact, we have a public workshop where people can see what we are proposing as optional solutions to congestion problems, parking problems, vendor issues, the triangle and all the stuff that you talked about. There are options that the community can see, feel and make a decision on whether we should go ahead with them. They can let us know their priorities and the solutions they think are viable for the community. All those things are being studied and looked at.

The tourism and marketing campaign for Chinatown is one of the things to help revitalize the economy in Chinatown. By creating this campaign, we try to get outside visitors to Chinatown, locally, nationally, and internationally. We’ve hired consultants who specialize in public relations, tourist attractions, and advertising to help Chinatown. There are other things that we are working on, such as the renovation of the pavilion, the landscaping of Columbus Park, as well as other parks in the area. Of course, there are many proposals from the community; the board is looking to which should be allocated the remaining funding that we are entrusted with, and to see if we can help Chinatown in anyway that we can. As far as LMDC is concerned, it might not be enough. Certainly, there are other agencies, federal and state, that might be able to help Chinatown. As long as the community stands together and voices its concerns, I’m sure that there is something that can be done.

Thomas Tam: You’re saying that there are all kinds of plans put out by LMDC to deal with traffic problems?

John Leo: That’s actually only one of four or five studies concerning traffic in Chinatown. The Rebuild Chinatown Initiative has done preliminary studies about pedestrian-izing some of the streets in Chinatown, for Mott Street or some of the less-used vehicular traffic streets and time of day closures so it would be pedestrian friendly plus different types of streetscapes for Chinatown. There are a lot of things going on. There’s the Canal Area. Transportation Study which looks at the one-way tolls; there’s the CATS 2 study that looks at regional planning including truck routes, which Canal Street is a major part of. All these are being looked at. As far as implementation is concerned, we want to find out the community’s priority. If you like to do it, we would fund some of these projects.

Thomas Tam: What kind of money are you talking about?

John Leo: There is no budget allotted right now. We’ll see how much it’s going to cost, and then decide.

Thomas Tam: Any comments from our panelists about this seemingly promising idea?

John Wang: It’s certainly a credit to John Leo, who has been trying to coordinate a community response and convey back to LMDC. Chinatown gets mostly studies; we don’t get money. The public sector gets away from its real responsibility by doing a lot of studies, showing actions and recommendations, but never gets to the implementation stage because there’s no money left to implement. That’s the problem. Until we get to the stage when there is a budget to take action, those studies are just words on paper. That’s something the community needs to keep in mind. Many people have been interviewed time and again. People are getting maxed out by the studies. It’s important that we begin to develop action plans, with all the information we have. The studies have provided many recommendations. How can we put them into action and put some money in the budget to get it done?

Male Audience: Do you have any plans to demolish old buildings?

John Wang: Well, that’s a city planning question.

Male Audience: Remodel Chinatown.

Jerry Cheng: No, what do you mean, remodel?

Thomas Tam: I think it’s rebuilding…

Male Audience: section by section.

Betty Lee Sung: Jerry, what he’s referring to is way before your time and everybody else’s. Back in 1950, there was a plan, proposed by Robert Moses, to rebuild Chinatown in six sections, a little bit at a time. Just as the plan proposed by you and Mayor Koch was opposed by the merchants, the 1950 plan fell through because it was also opposed by CCBA and a lot of the merchants.

Now I would like to know, either from John or from you: To what extent is the lack of money, or the community opposition that is impeding the rebuilding of Chinatown.

Jerry Cheng: Actually, Mayor Koch already allocated two millions dollars for the “Beautification of Chinatown”. At that time, we were trying to make Mott Street, Bayard, Pell and Doyle, the core of Chinatown, into a part-time pedestrian mall. That is to say, vehicular traffic would be closed when the pedestrian volume is high. We were going to repaint the streets. It’s a major city investment. All the merchants don’t have to pay anything. The city pays everything. Store owners, however, are concerned about the loss of business during construction, even though construction lasts a very short time. So, that’s unfortunate. That’s the first time all the merchants united and sent letter to the Mayor. So, t’s gone.

Betty Lee Sung: In the future, to what extent is community resistance going to prevent Chinatown from being remodeled?

John Wang: There was resistance; there will continue to be resistance. It’s hard to get everyone to think the same way. If the community is properly informed and educated, perhaps you can win over most of the people in the community to undertake some kind of a reconstruction or redevelopment. We’ve talked to the city planning commission to initiate a zoning study of Chinatown to see how the land can be more properly used. That will have a long-term impact on the community’s economy.

Thomas Tam: There are conflicts between different groups within the community, between community residents, between business owners, and between labor and capital, about how to use the space. As we struggle, as we talk and as time goes by, are we running the risk of losing the support from public sectors whose help we need?

John Wang: There is not one community that doesn’t have internal dispute within different groups. Name me one community that has no dissension within. That’s just not possible. Every community, whether Chinese or other group, always has disagreement. That’s just part of us as human beings. I have often heard that because there is disagreement within the community group, until you come to agreement, we cannot do anything for you. To me, that seems to be an excuse for not doing anything. In Harlem community, in Jewish community, in Hispanic community, there will always be different factions with different disputes. We need to recognize that. The public sector needs to work with credible organizations in the community, responsible organizations with responsible plans. The public sector’s responsibility is to be able to work with different segments of the community, and to advance the interests of the community and this city as a whole.

Thomas Tam: What kind of mechanism is established for working out knots so that everyone can share the pie?

John Wang: Some very positive trends have developed. The Chinese Consolidated Benevolent Association recently called a roundtable discussion, and invited many Chinese organization groups to discuss how to revive Chinatown. That’s something that should be continued. It certainly leads to a more cooperative attitude among all the factions in the community. At the same time, Asian Americans for Equality has done a study on the Chinatown Initiative; they have reached out to many segments of the community to have their input in the study. Now that the study is complete, they are encouraging them to implement the recommendations of the study. That trend is very positive; the public sector can put resources behind the plan and to encourage the community to work with one another. When you have very little resources, and everybody has to fight for it, that makes working together so much harder.

Edward Ma: I was involved with the Canal Street study that was led by Alan Gerson. He was chair of Community Board 2. The Metropolitan Transit Authority gave four or three workshops. I went to one, and I was shocked. You know how many people were there? Only four or five people.

There were reporters there. The MTA people had audio-visuals and PowerPoint Presentations. I was embarrassed. Finally, they agreed to give another workshop. This time, there were 300 people in attendance because the publicity was very effective.

Politicians let minority people fight each other; do you know why? You are a force. If you work together, politicians will have trouble to deal with you because you’re very strong.

John Leo: This is not a problem just for Chinatown; a lot of other communities have the same problem. LMDC started a Chinatown working group to get the community to talk to each other in the same room. That’s way before CCBA held the round table discussion last month. We’ve been trying to get Chinatown to collaborate and support certain proposals that the LMDC can provide funding for. That’s how the tourism campaign came about. We understand from the RCI studies and from the Asian Federation study that tourism trade is an economic driver for Chinatown, therefore, we allocated one million dollars from the 911 Fund for the tourism trade and marketing of Chinatown.

It doesn’t matter if the community is not pulling together as one unified group, but they should support each other so they can get the money and help Chinatown. If everybody thinks the money should go to his own pocket and not somebody else’s pocket, that’s a major concern.

Female Audience: I’ve been reading about the creation of business improvements in Chinatown. I want to know whether or not we need it, and what its purpose would be in Chinatown.

John Wang: Business improvement district is something that can be beneficial to Chinatown. Across the city, there are several dozen business improvement districts. They provide additional services to supplement what the city is providing to a given community. That could help address some of the issues and services that Chinatown needs. The question is how to get a broader participation from the community to put something like that together. In Flushing, Councilman John Liu, spearheaded the Flushing BID. He spent a great deal of time and brought different organizations together. There was some opposition, but he was able to overcome them. For Chinatown, we need to go through that exercise; bring many groups together to discuss the pros and con’s of the “BID”, and how that can help the community’s revitalization.

Jerry Cheng: There’s already a group pushing for a “BID” in Chinatown, and I’m part of that group. That’s the Cleaner Chinatown Council. We have been working on a Cleaner Chinatown for almost 10 years. We’ve been doing it quietly. If you go to Chinatown, you will see wastebaskets on the corner. You will see garbage bags with the Cleaner Chinatown sign. The council hired a few people to pick up the garbage, put them in the basket, and put them aside, making sure that they won’t spill to the street corner. Since we have already been doing this, we want to expand to provide other benefits.

The only problem was that they didn’t do a good job consulting with many other organizations. I hope that they can make this happen, because “BID” is really important. Flushing is a very good example. John Liu, the councilman, supported it. That’s why we also need Chinatown’s councilman to support it. It would be very helpful for Chinatown. The only thing is, we have to go through the right process to get the support from the majority of the community.

Thomas Tam: As we talk about community development and better businesses, cleaner streets, etc, it seems that the street vendors have become a big problem. Many vendors are actually new immigrants who try to make a living. If they’re unable to pursue their business on the streets, what kind of solutions do you have for them to make a living?

John Wang: The vendor problem is not limited to Chinatown; it’s a citywide issue. You have laws in the states and the cities governing those vendors’ operations. Of course, it’s a tough issue to address. Those people want to be self-sufficient selling goods on the street. At the same time, they violate certain city rules and regulations, and conflict with businesses that pay a lot of rent to maintain their business. In Harlem, they had to create a market for the vendors. Chinatown also tried to have one on Grand Street, within Roosevelt Park; it didn’t work out very well. It doesn’t mean that it couldn’t be tried again. Maybe some other way can be developed to help those vendors.

Jerry Chang: The problem with vendors is that they always want to have a place with a lot of pedestrian traffic. If you put them where it’s deserted or isolated, they don’t want to go there. Unfortunately, in those streets that are busy with pedestrians, it’s the area where you don’t want to have vendors because they block the pedestrian traffic. That’s why the Baxter Street triangle is an ideal location because that’s an area with a lot of pedestrian traffic.

Male Audience: As far as I know, the CATS study has looked at that triangle to create space for vendors, but they were facing a lot of opposition from the merchants and owners in that area. Pedestrian safety is one issue, at the same time, sanitation issue is also very big. On that particular island, there were a lot of fights over the garbage generated. It became a problem for the Fifth Precinct to enforce certain rules and regulations. That’s why it became a Green Street Program, where there are no vendors but shrubs. It is a major issue for new immigrants; they don’t have any skills; selling on the streets is their livelihoods.

Female Audience: When you have business improvement, it means increase in real estate value. A lot of times that end up in the displacement of low wage workers and low income residents, as well as small businesses, like street vendors. In this vision of improving Chinatown, who is it really for? Who do you envision will be living and working there? how do you protect the low income people?

John Wang: A healthy community is a balanced community, not with only one set of income. In many ways, Chinatown has always been a mix. You don’t want to sacrifice community improvement just because certain people will be negatively impacted. In any change, there will be people benefited, and there will be people that are adversely affected. The question for the planner is, how do you balance that? It’s a process you need to go through. Do we want to have a cleaner Chinatown? Do we want to have a more prosperous Chinatown? Do we want to create more jobs? Do we want to create more housing? And how do we achieve that? These are some of the questions that need to be addressed. If I had all the answers, then I wouldn’t be here.

We all know what Times Square was like 15, 20 years ago. Look at what Times Square has become today. Some people benefited, other people have been negatively impacted, but there is overall benefit to the city. I’m sure there are people still arguing that it is a bad thing, that they would rather have the porn shops there. There were those unsavory people in the area because some poorer people were able to live there. On the other hand, some people will say that’s improvement, because they can walk down the street. They are not scared that they’ll get mugged, killed or whatever. The city has more and more business coming in, and there are more jobs created in the area. There will always be that conflict of interests.

Male Audience: For many years, Chinatown has been a garment manufacturing haven until competition from overseas brought it down. What is going to replace the garment industry? What are the job prospects for new immigrants?

John Wang: We all know that the garment industry used to be populated by the Jewish population and by Italians. There are succeeding generations of immigrants that enter and exit this industry. History is taking place. Lower East Side, at one time was populated by the non-colored. Now, they are mostly minorities. There’s a transformation that is going on. The garment industry has been a provider of entry level jobs for many immigrants. That helped build the Chinatown community in the last 30, 40 years. Perhaps, we have to look at other types of employment that can address the needs of the new immigrants now.

Male Audience: What are they?

John Wang: I don’t know what those industries are. Earlier on, the internet bubble created a new type of employment. Of course, you need to have certain skills, certain language ability, and technical know-how to be able to do that. We should have some kind of analysis in terms of future employment needs. Immigrants are coming to this country with their language skills as well as skills for carrying out certain jobs. They need to be better analyzed and see how they can fit into the community and into the society as a whole. There is no ready-made answer to address those issues.

Betty Lee Sung: Actually, I have one question and one statement. The question is, does anybody know what the turnover rate or the failure rate of businesses in Chinatown? Within the small area of where I live, I noticed that three businesses that I used to patronize have gone out of business. One is Gum Gok, a big store that went out of business. Our favorite restaurant on the corner, I thought it was doing very well, and all of a sudden, one day it’s all boarded up and it’s out of business. Another dress shop I used to go to is also out of business.

Last Sunday in the New York Times, the Real Estate section talked about all these new, middle class or upper class residential units that are being built. I said, “This is so close to Chinatown, it’s going to be packed.” They are going to come in here. They are going to eat. They might want to buy things. How is Chinatown going to deal with this? Because that’s a lot of units, this could bring in a lot of business, but are we ready for all these people?

John Wang: I think the failure rate is relatively high. The national statistics for small businesses to stay afloat over three years is probably about 40%. In Chinatown, you do see a lot of businesses going in and out, especially restaurants. They open up one day, then close a few months later. Another guy would then come in and does it all over again. I think the failure rate is fairly high.

John Leo: May I address the question about more people coming into Chinatown? As part of a campaign, we do have a technical assistance component to it. We actually have Bonnie Wong’s Asian Women in Business group, going door to door, talking to businesses owners. They help them with marketing, and conducting business in different ways so that they are prepared for the influx of more visitors.

The Small Business Services Department is also holding a workshop for Chinatown businesses to learn about rules, regulations and enforcement issues in Chinatown. That’s a very good beginning to help the Chinatown small businesses so no one gets fined all the time, and to prepare them for growth and for more businesses to come in. I think that’s very important, and that’s the right step.

Edward Ma: I think I have some answers for the gentleman. Number one, after the garment factory closings, many community organizations including Chinese American Planning Council, Asian American For Equality, Chinatown Manpower Project, have established vocational trainings for small businesses, computer training, and especially domestic service and home attendants. After September 11, the garment factories have gone down, but the number of home attendants has gone up. A lot of garment people were transferred to this new industry. They don’t need English; they just go there to help. Number two, new immigrants working alone cannot survive. The Wenzhounese and the Fujianese survive by opening big supermarkets. Number three, Chinatown appreciates tourists. If a free bus can be established to go from Wall Street to Chinatown, we can pick up one third, one fourth, or one fifth of the tourists from Wall Street. We can help businesses in Chinatown.

Thomas Tam: Well, I want to thank you very much, Ed, for your three comments. I just want to take this opportunity to thank the panelists for joining us today.

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