Sunday, November 30, 2008

The investigation into the city's practices regarding tax-exempt bonds isn't over

In response to those who've prematurely assumed that the Atlantic Yards arena is dead, I've asserted that it is, rather, very much in play. Indeed, the recommitment of the Barclays Center naming rights deal is a sign that the project has some juice, even as the stock of parent Forest City Enterprises slumbers. (It´s still down nearly 90% from its peak, but up some 50% from its low.)

At the same time, the Congressional investigation led by Rep. Dennis Kucinich (D-OH) into questionable assessments of Yankee Stadium also remains in play, as Kucinich has vowed. (“We’re going to continue our work here, make no mistake about that," he said after a hearing October 24.)

Should further and more concrete evidence of dubious practices be found, that would cast doubt on the tax-exempt bonds issued for the Yankees and, inevitably, the still inchoate plan for tax-exempt bonds issued for the Atlantic Yards arena.

In other words, even though more lenient regulations for the arena bonds were grandfathered in, questions will be asked.

Attorney-client privilege

Noticing New York blogger Michael D.D. White has argued that the city, which has resisted turning over documents requested by Kucinich on the grounds of attorney-client privilege, doesn't have a good case.

He writes:
Attorney-client privilege doesn’t extend to facts. You can’t take facts that are not privileged and magically cloak them with privilege by communicating them to an attorney. It is also questionable whether this privilege of secrecy can apply at all to the public process of issuing bonds and taxing property. When it comes to bonds, almost the reverse is true; rather than being able to conceal negative information there is a special obligation to disclose it.

(Emphases in original)

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