Thursday, February 16, 2012

Did Goldman, Sachs try to run the Brooklyn Arena LDC? It appeared so, but then an Investor Update call for today was canceled.

Well, we knew that the Brooklyn Arena Local Development Corporation (BALDC), the entity set up to issue tax-free bonds for the arena, was little more than an alter ego of the Empire State Development Corporation (ESDC), even though it is officially a "creation" of the Job Development Authority (JDA), another ESDC alter ego.

I was recently alerted to an Investor Update Call scheduled for today, apparently to alert arena bondholders on the progress of construction. The document, issued via the Municipal Securities Rulemaking Board, stated:
The Brooklyn Arena Local Development Corporation invites you to participate in an Investor Update Call related to the above-captioned transaction.
The RSVP went to a staffer at Goldman, Sachs, Marc Howland.

Very curious

That sounded odd, given that  the BALDC is a publicly created body, with board members appointed by public officials.

How could this be delegated to Goldman? Was the ESDC (also known simply as Empire State Development) involved?

Never mind

I inquired to both the ESDC and to Goldman, and got a response from the former:
The referenced Update Investor Call notification was neither sent or authorized by the Brooklyn Arena Local Development Corporation. We have been advised that the call has been postponed until further notice.
So maybe Goldman, Sachs is not in charge of the governmental fig leaf that is the BALDC. They just thought they were.

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