ESDC: release of Atlantic Yards cost would be "damaging" to Forest City Ratner; DDDB asks comptrollers for disclosure

Three weeks ago, I described how the New York City Economic Development Corporation (NYC EDC) had declared that the current cost of the Atlantic Yards project is exempt from disclosure because it is either a trade secret or its disclosure "would cause substantial injury to the competitive position of the subject enterprise."

The Empire State Development Corporation (ESDC), which was slower to respond to my Freedom of Information Law (FOIL) request, gave essentially the same response. (Click on images to enlarge.)

Yesterday, Develop Don't Destroy Brooklyn (DDDB) asked that "New York State Comptroller Thomas DiNapoli and New York City Comptroller William Thompson procure—and release to the public—the construction costs for developer Forest City Ratner’s proposed Barclays Center Arena and the entirety of the Atlantic Yards development plan," saying that "costs are not proprietary information—especially for a project subsidized by taxpayers."

(DDDB didn't know at the time that the ESDC had rejected my request, but suggested that truly proprietary information could be redacted.)

"Detrimental" to developer

The Financial Materials, ESDC said, quoting from a Forest City Ratner response, "contain proprietary assumptions, analyses and projections regarding the feasibility and performance of the Project and provide insight into FCRC's proprietary financial models and other business practices, which would be detrimental to FCRC's competitive position if disclosed."

ESDC's letter quotes Forest City's objection that disclosure "would indisputably frustrate this [negotiation]process by providing the public--and indeed many parties with whom FCRC is in ongoing negotiations--with confidential non-public information as to the material assumptions included in our internal financial feasibility analysis."

ESDC concludes, "FOIL clearly protects companies from the release of information that can be damaging to their businesses."

Impact of negotiations

So what does ESDC's stonewalling mean? I can't be sure, but as I wrote, a significantly less expensive arena--cut in half from $950 million?-- might confirm that Frank Gehry's design has been significantly altered. And that might cause consternation among the sponsors already signed up to plaster their names on a "landmark" arena.

Or, perhaps, a cost estimate limited to Phase 1 might confirm that Forest City Ratner is unlikely to fulfill CEO Bruce Ratner's May 2008 pledge, "We anticipate finishing all of Atlantic Yards by 2018."

The public policy issue

It's understandable, as a general matter, why FOIL would aim to protect companies from the release of damaging information.

In this case, however, the cost of the project and the arena was a public matter when the ESDC approved Atlantic Yards in December 2006.

Now the ESDC is saying it's a private matter.

If the cost is now a secret, that suggests that developers and public agencies can announce one set of numbers to the public, then turn around and keep the actual numbers secret.

I have filed an appeal with the ESDC and, as with the appeal filed with EDC, I don't expect it to be granted.