The Lessons to Be Learned from the Failure of Diller Island

The Lessons to Be Learned from the Failure of Diller Island

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Large philanthropic gifts can have an incredible impact on communities. The philanthropists capable of making these monumental donations usually have the best intentions, yet some argue that these gifts are one of the most important ways the affluent wield power and influence. After all, philanthropists have ultimate control over how their millions are allocated, so they decide which social issues and organizations will receive the most support and public attention. At the same time, the power that these wealthy donors wield is limited, considering that many philanthropic projects need more than just money to succeed—they also require community support and good management.

For example, some large gifts have had very little effect. Perhaps the most obvious example is Mark Zuckerberg’s donation to Newark public schools in 2010. The $100 million gift had little impact, as much of the money was allocated in fruitless ways. Altogether, students and teachers in Newark saw few, if any, improvements to their schools. The lesson here is that it takes more than money to get something done. Philanthropists need to partner with the community and with relevant thought leaders to make the impact that they want. Another example of this principle is the Diller Island project in New York City that recently fell flat.

Diller Island – An Attempt to Transform Manhattan’s Waterfront

In September 2017, the massive $250 million Diller Island project was completely abandoned. The project would have revitalized Pier 55, currently a dilapidated pile of wood, with a floating park that could have served as a new cultural center for the waterfront or hosted an entertainment venue. The ultimate failure of the project came when donors Barry Diller and Diane von Furstenberg pulled their funding for the new pier. Their decision was precipitated by costly lawsuits and controversy surrounding the entire project. While several factors played into the project’s demise, arguably, the main problem was that the entire vision was driven by one man’s wealth and his expectations for the park.

Public-private partnerships for public spaces come with many strings attached. People in cities across the nation have become skeptical of these projects, especially when they are attached to a high-profile name. Diller Island fell into many of the common traps involved in this type of project, including lack of input from the public.

A number of big names supported the project, including New York Governor Andrew Cuomo, Senator Chuck Schumer, and Mayor Bill de Blasio. These officials would likely point to the small group of protestors led by real estate mogul Douglas Durst as the downfall of Diller Island. The group had concerns about the environmental impact of the project and the overall planning process. These issues could have been addressed by consulting with environmental groups and earning their buy-in from an early stage, but instead the conflict turned into legal war waged by two billionaires as the public stood by without a voice.

The Role of Compromise in Public Philanthropy

The failure of Diller Park can also be attributed to a lack of compromise—the involved parties were never really on the same page about the project. When the Hudson River Park Trust first approached Diller about the project, the trust envisioned something much smaller and ultimately asked for just $35 million. However, Diller said that he would only sign on to the project if it were much more ambitious. Diller hired noted architect Thomas Heatherwick and consulted with Hollywood producers and directors to create performance spaces. These costs skyrocketed the project to its $250 million price tag, which was also expected to be covered by taxpayer dollars. In return, a nonprofit funded by Diller would maintain the park and facilitate art performances, many of which would be free or low cost. However, that stipulation would have still allowed half the performances to be prohibitively expensive for many people.

New York residents expressed some concern about the project’s undemocratic planning process. While much of Diller Island would have been funded through Diller himself, the taxpayers were still expected to contribute, but they were largely left in the dark until the official announcement of the project in 2014. Even government officials, such as Assemblywoman Deborah Glick, were shocked by the announcement and opposed the project on grounds of lack of public consultation.

When Diller announced that he was pulling out of the project, the Hudson River Park Trust asked him if he would consider a smaller construction, and he refused. From the beginning, it appears that he was not on the same page with other people involved in the project, including much of the public and the park trust. The problem is that his philanthropy was essentially supposed to benefit the public.

The Responsibilities of Public Philanthropists

The Diller Island debacle raises some other troubling questions. While Zuckerberg’s donation to public schools ultimately failed, he was trying to benefit students who were largely ignored. The Diller Island project raised concern among some people because it would have created yet another attraction primarily for wealthy Manhattan neighborhoods. In New York, many low-income neighborhoods have virtually no access to parks and playgrounds, while philanthropists use millions of dollars to upgrade existing parks in affluent areas or even build new ones, such as the High Line. Diller Island would have been situated just blocks from the High Line, in an extremely wealthy area. While Diller has the right to use his money as he sees fit, the issue is the conflict between public use and private funds. Many argue that a public project that uses taxpayer money—even one that’s also supported by private money—should not only benefit a narrow slice of the population.

The larger lesson to learn from Diller Island is the importance of discussion and securing consent from all affected parties. If the public were involved earlier, as well as environmental groups, perhaps the project could have proceeded as planned.

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