From Steve Ettlinger's op-ed in today's New York Sun, Against Ratner's Domain:
Mr. Ratner's purported public benefits are easily disputed, and they are the key to the court case.
The underlying argument was that the arena would be publicly owned and merely leased to Mr. Ratner. Truth is, he expects a 99-year lease for the princely sum of $1. If the public really will own it, why did Barclay's Bank agree to pay Mr. Ratner $400 million so it could be called the Barclay's Arena?
It's a little more complicated than that--the public ownership is apparently a way to issue tax-free bonds and gain other advantages, and Ratner would pay more than a buck. But it's still a pretty good deal. Ratner would pay off the bonds issued to build the arena, gains an advantage because those bonds would be tax-free.
The ESDC's answer
Last January, I raised the issue with the Empire State Development Corporation. Given that the arena would be publicly-owned, should the Local Development Corporation (LDC) that would be set up be in charge of naming rights? Can the LDC pass them on to Forest City Ratner?
Then-spokeswoman Jessica Copen responded, "Financing for the stadium comes ultimately from the team. The team has the naming rights. It's the same deal as with the Mets - who also sold naming rights to their new stadium."
That leaves out that tax benefits from financing, the significant public contribution ($305 million to infrastructure), the conveyance of city streets for $1, the threat (and use) of eminent domain, and more government assistance. (Here's the Independent Budget Office's September 2005 report that cites various special benefits.)
The naming rights, in fact, would pay for a good portion of construction.
The $100,000 rental?
Ettlinger's op-ed states:
The final insult was when [the ESDC lawyer] said that local schools could use the arena. That's no public benefit at all in my book because Mr. Ratner plans on charging over $100,000 for such rentals.
That's not quite so. A report by KPMG raised the specter of $100,000 arena rentals, but attorneys for the developer said in legal papers that discounts would be given where appropriate.
Mr. Ratner's purported public benefits are easily disputed, and they are the key to the court case.
The underlying argument was that the arena would be publicly owned and merely leased to Mr. Ratner. Truth is, he expects a 99-year lease for the princely sum of $1. If the public really will own it, why did Barclay's Bank agree to pay Mr. Ratner $400 million so it could be called the Barclay's Arena?
It's a little more complicated than that--the public ownership is apparently a way to issue tax-free bonds and gain other advantages, and Ratner would pay more than a buck. But it's still a pretty good deal. Ratner would pay off the bonds issued to build the arena, gains an advantage because those bonds would be tax-free.
The ESDC's answer
Last January, I raised the issue with the Empire State Development Corporation. Given that the arena would be publicly-owned, should the Local Development Corporation (LDC) that would be set up be in charge of naming rights? Can the LDC pass them on to Forest City Ratner?
Then-spokeswoman Jessica Copen responded, "Financing for the stadium comes ultimately from the team. The team has the naming rights. It's the same deal as with the Mets - who also sold naming rights to their new stadium."
That leaves out that tax benefits from financing, the significant public contribution ($305 million to infrastructure), the conveyance of city streets for $1, the threat (and use) of eminent domain, and more government assistance. (Here's the Independent Budget Office's September 2005 report that cites various special benefits.)
The naming rights, in fact, would pay for a good portion of construction.
The $100,000 rental?
Ettlinger's op-ed states:
The final insult was when [the ESDC lawyer] said that local schools could use the arena. That's no public benefit at all in my book because Mr. Ratner plans on charging over $100,000 for such rentals.
That's not quite so. A report by KPMG raised the specter of $100,000 arena rentals, but attorneys for the developer said in legal papers that discounts would be given where appropriate.
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