How much did New York City give to Atlantic Yards in direct subsidy?
Only after the project was passed in 2006 did the city announced additional subsidies: apparently $105 million, as claimed by Forest City (see screenshot at right), leading to total of $305 million from city and state.
The city later claimed its total subsidies are $179 million or $171.5 million, not $205 million.
Another number
Note that the $131 million cited refers to land purchases, since another $31 million was added to pay for property needed for the arena.
Note footnote 2, which says "Excludes $20 mm for water main, $20 mm in corresponding targeted additional subsidy also deleted."
Why cut the water main?
That $20 million for the water main seems likely how been part of the previous $205 million in city subsidies. That $20 million was surely spent.
(It was once supposed to be $30 million, as indicated in the screenshot at right, part of a New York City response in 2008 to my Freedom of Information Law request. That tally was of course not final, given that $31 million instead went to buy land, and the Sixth Avenue bridge/overpass did not need to be rebuilt.)
"The city's infrastructure expenditure includes monies for the water main," a city spokesman told me in 2010. So it helped the project, but was not considered a direct subsidy for the project.
In a February 2005 Memorandum of Understanding, the city and state each promised $100 million, with the state money for infrastructure and the city money for infrastructure or land purchases. Later we learned that the latter all went to reimburse Forest City Ratner's seemingly generous payouts for property owners.
The city later claimed its total subsidies are $179 million or $171.5 million, not $205 million.
Another number
Here's another estimate: $185 million, courtesy of the 2010 City Participation Agreement that covered potential reimbursement for public property, among other things.
As highlighted below, the document cites $154 million in public subsidies, with a footnote pointing to a statement: "Assumes $285mm in total subsidy less $131mm in subsidy allocated to the arena. $20mm in subsidy for water main has been deleted along with corresponding costs."
Note that the $131 million cited refers to land purchases, since another $31 million was added to pay for property needed for the arena.
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| Emphases added in red |
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| 2008 city document |
That $20 million for the water main seems likely how been part of the previous $205 million in city subsidies. That $20 million was surely spent.
(It was once supposed to be $30 million, as indicated in the screenshot at right, part of a New York City response in 2008 to my Freedom of Information Law request. That tally was of course not final, given that $31 million instead went to buy land, and the Sixth Avenue bridge/overpass did not need to be rebuilt.)
"The city's infrastructure expenditure includes monies for the water main," a city spokesman told me in 2010. So it helped the project, but was not considered a direct subsidy for the project.
What's the total?
So, while it's understandable for the city to claim $185 million, I think it's still reasonable to rely on the developer's own claim of $305 million total, including $205 million from the city.
Note that the Independent Budget Office was more conservative, in 2009 writing:
Note that the Independent Budget Office was more conservative, in 2009 writing:
Because a portion of the additional $105 million in city capital contributions cited by the Mayor would likely have occurred in the absence of the project, IBO counts about half of this addition—$50 million—as part of the city’s capital contribution for the project.
That was a little conservative, by my lights. For one thing, $31 million went to land, not infrastructure. Also, the capital contributions--transportation, water main, Atlantic Avenue improvements--surely significantly helped Atlantic Yards more than than $20 million, given the enormous increase in apartments.
And, of course, by 2010 the City Participation Agreement counted an extra $85 million.
Not just direct subsidy
Keep in mind that city assistance can also be attributed to free or low-valued property contributed to the project, with a questionable repayment plan for the latter, as well as tax breaks.
Per square foot
Also note the AY SAC per ZSF, or Site Allocation Costs for Zoning Square Foot, or $188.
Interestingly, in December 2013, when the Greenland USA investment was announced, a joint press release with Forest City stated, "Based on the 6.4 million square feet of remaining entitlements in both phases, the total anticipated costs yield an expected average cost per square foot of approximately $180-$220 per square foot, prior to vertical development."
That suggested some modest increase in overall investment needed in infrastructure. But that cost was surely lowered by Greenland's investment level, which repaid Forest City for some of its land investment.
Also note the AY SAC per ZSF, or Site Allocation Costs for Zoning Square Foot, or $188.
Interestingly, in December 2013, when the Greenland USA investment was announced, a joint press release with Forest City stated, "Based on the 6.4 million square feet of remaining entitlements in both phases, the total anticipated costs yield an expected average cost per square foot of approximately $180-$220 per square foot, prior to vertical development."
That suggested some modest increase in overall investment needed in infrastructure. But that cost was surely lowered by Greenland's investment level, which repaid Forest City for some of its land investment.
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