Wednesday, July 02, 2008

Does Beekman “blackmail” presage AY subsidy push?

The Downtown Express has the tale (excerpted on No Land Grab) of how Forest City Ratner got Manhattan Community Board 1 to endorse its application for a 421-a tax break for the luxury Beekman Tower, already subsidized by Liberty Bonds.

Without the tax break, said MaryAnne Gilmartin, Forest City Ratner’s executive VP (and the successor to Jim Stuckey), “Work would certainly stop on [the] site and then we would have delays.” So the CB complied, not wanting to see the school delayed.

The newspaper reported:
“I don’t think the project or the school were ever really in jeopardy,” said Paul Hovitz, a board member. “I think they were manipulating us [into helping them get the abatement]. We were being blackmailed.”

In the AY context

What might this mean in the Atlantic Yards context? That when Forest City Ratner CEO Bruce Ratner said that the project "will be almost exclusively privately financed," he could just as easily have said it would be “largely publicly assisted, more and more.”

Remember, Ratner claimed in 2003 that Atlantic Yards "won't touch the existing tax base."

So, when Forest City Enterprises CEO Chuck Ratner said “We still need more” subsidies, that could mean that local officials will have to pony up more money to get the precious affordable housing that might have been funded elsewhere, in another way.

AY vs. Beekman

The Atlantic Yards project is not, however, as far ahead as Beekman Tower, which already has financing. While the developer—not the government—has already spent $219 million, the value of the property acquired remains substantial.

The question of tax-exempt financing for the new Yankee Stadium—and, by extension, the planned Atlantic Yards arena—will be taken up at an Assembly hearing today.

1 comment:

  1. Is Speaker Sheldon Silver aware and does he care when his constituents are bullied this way and taken advantage of by a developer he favored? Does he appreciate that this is what happens when you give a developer (Ratner in particular) a monopoly first and then try and negotiate subsidy afterwards. (“Bass-ackwards!”) This is a small scale example of what we are being set up for as Ratner uses his theoretical “monopoly” to fish for all billions of dollars of Atlantic Yards subsidies in yet-to-be-specified amounts.

    Does Speaker Silver think that he has any control over these billions? Does the Public Authorities Control Board (“PACB”) or Sheldon Silver have any “Control”over these unspecified billions? What about when projects become different projects than the PACB approved? I heard a rumor that Speaker Silver wants to change the name of Public Authorities Control Board to the Public Authorities Board. I heard he wants to take out the word “Control.” I heard he is promoting the idea that the PACB newly formulated as the PAB plans to give the “Control” part to the developers- Maybe, (maybe, maybe) the PAB will approve projects once- But thereafter the developers will be the ones who “Control” what it is the PAB allows then to do and will be entitled to change projects as much as they like whenever they want.

    Michael D. D. White
    Noticing New York

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