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May 18, 2020

Stroock Special Bulletin

By: Ross F. Moskowitz, Karen Scanna, Trevor T. Adler, Kenneth H. Theil, Eva C. Schneider

Last week, Governor Andrew Cuomo announced a reopening plan for the State and issued an Executive Order that provides more clarity with respect to the time frames for allowing development and construction projects to resume.

Governor Cuomo announced the New York Forward Plan (the “Plan”), which outlines a phased reopening of geographic regions across New York State as well as a phased reopening of businesses within these regions. He also issued Executive Order No. 202.31, which, among other things, extends New York on PAUSE until May 28, 2020.

This article provides a summary of the Plan and the Executive Order as applied to development and construction projects in New York City.

Reopening Business in Phases

The Plan provides that New York State will reopen businesses in phases, with two weeks in between each phase. The phase-in procedure prioritizes opening businesses that “have a greater economic impact and inherently lower risk of infection for workers and customers.” Moreover, each business that does reopen will be required to implement protection plans for employees and consumers, make the physical work space safer and implement processes to lower infection.

The four business reopening phases are as follows:

• Phase 1: Construction, manufacturing, wholesale trade, select retail for curbside pickup only, agriculture, forestry and fishing.

• Phase 2: Professional services, finance and insurance, retail, administrative support, real estate, rental and leasing.

• Phase 3: Restaurants and food services.

• Phase 4:  Arts, entertainment, recreation and education.

Development and construction are part of Phase 1; therefore, once New York City does reopen, these projects may begin to resume (assuming any mandated health and safety measures are taken when resuming such work).

Reopening New York State by Region

The question of when New York City will reopen will be dictated by both Executive Order 202.31 and the Plan. The Plan provides a framework for reopening New York State by region based on four factors: (1) The infection rate is low; (2) The health care system has the capacity to absorb a potential resurgence in new cases; (3) Diagnostic testing capacity is sufficiently high to detect and isolate new cases; and (4) Robust contact tracing capacity is in place to help prevent the spread of the virus. Each of these four factors is broken into seven individual metrics that must be met by each region before it can be deemed “reopened”:

1. Decline in total hospitalizations over a 14-day period (or alternatively, if a region has seen few COVID cases overall, the region has not seen a spike of more than 15 hospitalizations in any three-day period);

2. Decline in number of daily deaths over a 14-day period (or alternatively, if a region has seen few COVID cases overall, the region has not seen a spike of more than 15 deaths in any three-day period);

3. Decline in new hospitalizations over a 14-day period;

4. Hospital bed capacity of at least 30%;

5. ICU bed capacity of at least 30% and a 90-day supply of personal protective equipment (“PPE”) in every hospital;

6. Diagnostic testing capacity of at least 3o tests per 1,000 people per month; and

7. Established contact tracing programs to monitor and control the infection rate.

In addition to extending New York on PAUSE until May 28, 2020, the Executive Order provides for the reopening of the following five regions of New York State as of May 15, 2020, since these regions have met the above metrics: Finger Lakes, Central New York, Mohawk Valley, Southern Tier and the North Country.

This weekend, Governor Cuomo announced that Albany and Buffalo can reopen and Phase 1 businesses may resume as early as this week once the regions hire or train additional contact tracers. The Capital region may also be reopening shortly, as the region will likely meet the first and second metrics soon (i.e., no spike in deaths or hospitalization rates in a three-day period as calculated from May 15, the date regions first were allowed to open).  Today, Governor Cuomo announced that the Western New York region will be able to meet the seventh metric and will be reopened tomorrow.

Per the Plan, each region within New York State is required to appoint a “Control Room” (a team of local elected officials, hospital and state representatives) to monitor these seven metrics, and the Control Room has the ability to slow or stop reopening if indicators are problematic. The Control Room for each region will also be responsible for monitoring businesses’ compliance with reopening guidelines and ensuring enforcement of these rules when necessary.

If New York City is able to meet the above seven metrics by May 28, there is a possibility it will begin to reopen and development and construction projects, which are part of Phase 1, can begin to resume. However, given the projected numbers it is not likely that New York City will reopen for development and construction by that date. Based on the projected numbers and statements made by various political leaders, there is a possibility that New York City may begin to reopen sometime in June. 

Click here to read the full version of the New York Forward Plan and click here to read the Executive Order.

Feel free to reach out to Stroock’s Development and Construction teams with any questions you have. We are here to help and support you. Stay safe and healthy.

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For More Information

Ross F. Moskowitz

Karen Scanna

Trevor T. Adler

Kenneth H. Theil

Eva C. Schneider

This Stroock publication offers general information and should not be taken or used as legal advice for specific situations, which depend on the evaluation of precise factual circumstances. Please note that Stroock does not undertake to update its publications after their publication date to reflect subsequent developments. This Stroock publication may contain attorney advertising. Prior results do not guarantee a similar outcome.