Skip to main content

The Yankees deal gets some more scrutiny, AY gets a mention

Yesterday, on the radio/TV program Democracy Now! (with transcript), Rep. Dennis Kucinich, whose Congressional subcommittee has looked closely at tax-exempt bonds for sports facilities, was interviewed by co-host Juan Gonzalez, who had found some curious discrepancies in the New York Yankees deal in a column Monday.

Kucinich chairs the Domestic Policy Subcommittee of the House Oversight and Government Reform Committee, which is looking into allegations that the city inflated the value of the land for the new Yankee Stadium, in order to enable a PILOT (payment in lieu of taxes), while at the same time lowballing the value to satisfy a federal requirement to replace parkland with property of equal value.

Kucinich (right) told Gonzalez:
From what I understand, as a result of our hearing [the IRS and Treasury Department] are reviewing their policies to see whether or not the 1986 Tax Reform Act has actually been compromised by the decision that they made. I think that it’s important to understand that we’re not alleging at this point that there’s been any kind of criminal activity. We’re simply reviewing all the information that’s been presented to us, so that we can determine, first of all, the discrepancy in the appraisals; secondly, the public policy issue of using tax-exempt bonds for these stadiums; and third, if there is an inflated value of this project, the implication that it has for security laws, with respect to the issuance of the tremendous amount of bond financing.

Hearing coming

Gonzalez also interviewed corporate watchdog Bettina Damiani of Good Jobs New York and Neil deMause of the book/web site Field of Schemes; both have looked closely at the Yankees deal and explained some of the issues regarding tax-exempt bonds.

A subcommittee hearing is upcoming in September; Gonzalez asked Kucinich about it.

Kucinich replied:
I can say that my subcommittee staff… is in contact with officials from both the city of New York and the New York Yankees to discuss their potential appearance in front of our Congressional subcommittee. I think that it’s very important to understand that we’re looking at a public policy matter here that relates not only to New York and not only to the Nets and the Atlantic Yard project, but it also relates to the whole country… because it’s quite possible that there are billions of dollars in tax benefits that should be going to municipalities for the purposes of repairing their infrastructure and for schools and other things and that are instead being diverted for these private sports complexes…
(Emphasis added)

Note that Kucinich's mispronunciation of "Atlantic Yards" suggests he's not quite up to speed on the deal.

Who are the watchdogs?

Near the end of the program, Damiani pointed to the absence of local watchdogs:
The city has really washed their hands of making sure there’s any accountability on jobs and clear benefits for New Yorkers on the other side of this project, which is very unfortunate. I mean, we’re grateful for Congressman Kucinich and Assembly Member [Richard] Brodsky to get involved in this issue. Neither represent New York City, by the way. New York City elected officials—they’re filling a void, because local elected officials in New York City have refused to get involved in this project. And we need them. We need them to make sure that the promises in the press releases actually turn out to be something that we can hold them accountable for.

Who's the landlord?

So, the "Landlord's Suite," as the Daily News reported Monday, must have eight seats plus standing room for four and offer the same "accommodations, services and amenities" as the other suites in the new $1.3 billion stadium, according to the Yankees' lease with the city-run Industrial Development Authority.

The Daily News Monday reported Mayor Mike Bloomberg's erroneous denial and then a spokesman's backtrack, claiming that the city hasn't decided what to do with the seats. A commenter on the Daily News web site suggested, "'The Landlord' is not a group of city officials. It is the people of the City of New York. It is the eight million residents who should be sharing this 'Landlord Suite,', not elected or appointed officials."

Bloomberg's obtuseness

On Field of Schemes, deMause reported Bloomberg's verbatim remarks, according to Patric Arden of Metro: "In the new stadiums, the city will not have any boxes, 'cause they're not going to be city-owned stadiums. They'll be built with private money - that was the whole deal. But I don't know whether anybody has any boxes. You talk to them."

However, the Yankees and Mets stadiums will be nominally owned by the IDA, so as to be publicly-owned and eligible for tax-exempt bonds, and leased to the teams for a song--as with the plan for the Atlantic Yards arena.

Bloomberg has shown similar obtuseness regarding the AY arena, claiming (ultimately erroneously) in a 1/23/04 radio interview that "any city monies of any meaningful size will be dead issues financed by the extra tax revenues that come from this. So, we’re not going to have to divert money from education, or police or fire or any other part of the city to do this. No. It is private money in that sense."

He also suggested that "the free market" was at work.

Comments

Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

Forest City acknowledges unspecified delays in Pacific Park, cites $300 million "impairment" in project value; what about affordable housing pledge?

Updated Monday Nov. 7 am: Note follow-up coverage of stock price drop and investor conference call and pending questions.

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:
if market-rate construction is delayed, will the affordable h…

Revising official figures, new report reveals Nets averaged just 11,622 home fans last season, Islanders drew 11,200 (and have option to leave in 2018)

The Brooklyn Nets drew an average of only 11,622 fans per home game in their most recent (and lousy) season, more than 23% below the announced official attendance figure, and little more than 65% of the Barclays Center's capacity.

The New York Islanders also drew some 19.4% below announced attendance, or 11,200 fans per home game.

The surprising numbers were disclosed in a consultant's report attached to the Preliminary Official Statement for the refinancing of some $462 million in tax-exempt bonds for the Barclays Center (plus another $20 million in taxable bonds). The refinancing should lower costs to Mikhail Prokhorov, owner of the arena operating company, by and average of $3.4 million a year through 2044 in paying off arena construction.

According to official figures, the Brooklyn Nets attendance averaged 17,187 in the debut season, 2012-13, 17,251 in 2013-14, 17,037 in 2014-15, and 15,125 in the most recent season, 2015-16. For hoops, the arena holds 17,732.

But official…

So, Forest City has some property subject to the future Gowanus rezoning

Writing yesterday, MAP: Who Owns All the Property Along the Gowanus Canal, DNAinfo's Leslie Albrecht lays out the positioning of various real estate players along the Gowanus Canal, a Superfund site:
As the city considers whether to rezone Gowanus and, perhaps, morph the gritty low-rise industrial area into a hot new neighborhood of residential towers (albeit at a fraction of the height of Manhattan's supertall buildings), DNAinfo reviewed property records along the canal to find out who stands to benefit most from the changes.
Investors have poured at least $440 million into buying land on the polluted waterway and more than a third of the properties have changed hands in the past decade, according to an examination of records for the nearly 130 properties along the 1.8-mile canal. While the single largest landowner is developer Property Markets Group, other landowners include Kushner Companies, Alloy Development, Two Trees, and Forest City New York.

Forest City's plans unc…

At 550 Vanderbilt, big chunk of apartments pitched to Chinese buyers as "international units"

One key to sales at the 550 Vanderbilt condo is the connection to China, thanks to Shanghai-based developer Greenland Holdings.

It's the parent of Greenland USA, which as part of Greenland Forest City Partners owns 70% of Pacific Park (except 461 Dean and the arena).

And sales in China may help explain how the developer was able to claim early momentum.
"Since 550 Vanderbilt launched pre-sales in June [2015], more than 80 residences have gone into contract, representing over 30% of the building’s 278 total residences," the developer said in a 9/25/15 press release announcing the opening of a sales gallery in Brooklyn. "The strong response from the marketplace indicates the high level of demand for well-designed new luxury homes in Brooklyn..."

Maybe. Or maybe it just meant a decent initial pipeline to Chinese buyers.

As lawyer Jay Neveloff, who represents Forest City, told the Real Deal in 2015, a project involving a Chinese firm "creates a huge market for…