Part of the argument is that Atlantic Yards has already proceeded significantly. But on more than one issue, the city and state obfuscate rather than explain. For example, consider this passage about Atlantic Yards spending (click to enlarge):
In order to illustrate the substantial progress that has been made with the Project prior to the issuance of the Proposed Regulations, we have provided the chronology of events set forth below.... Substantial amounts have been spent on the Project: approximately $99 million prior to 2006 (of which $15 million related to the Arena) and approximately $219 million prior to 2007 (of which $47 million related to the Arena).
Note that $47 million is a little less than 5% of the cost of the $950 million arena.
Who spent the money?
More importantly, note that the passive sentence construction fails to identify who has spent such substantial amounts. The ESDC confirms that the spender is not the city or state but developer Forest City Ratner.
[Update 7/19/08: I should've pointed out that the city and state have already passed along $55 million in public funds.]
Should tax-exempt bonds not be issued and if, for some reason, Atlantic Yards goes down the tubes, the expenditure of $219 million need not represent a loss for Forest City Ratner. Yes, some expenditures, such as for legal and architectural services, may not be recompensed, but surely the value of the land has risen.