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"Why should people get to see plans? This isn't a public project."
Bruce Ratner in Crain's Nov. 8, 2009

Paterson & Bloomberg Team Up to Veto Reform Impacting Sweetheart Deals Like Atlantic Yards


Paterson and Bloomberg are uniting to veto major reform of the cess pool of unaccountability and non-transparency otherwise known as the New York State Public Authorities. And why? Because it might block or upset thier friends' developments such as Atlantic Yards and diminish their control over the authorities which laughably claim to be independent.

We're looking at you Empire State Development Corporation, and you Metropolitan Transportation Authority.

(Update: Much more [and with less sarcasm] from Norman Oder on his Atlantic Yards Report, where he writes that regardless of the future of this reform legislation [nearly universally praised by editorial boards and good government groups], the MTA Board members already have a "fiduciary duty to protect the authority’s bottom line.")

The Times reports:

Paterson Set to Reject Public Authority Overhaul

By Danny Hakim

ALBANY — Gov. David A. Paterson is set to reject a sweeping overhaul of the state’s hundreds of public authorities that was passed by lawmakers last month but is opposed by the governor’s staff and Mayor Michael R. Bloomberg of New York City.

The Paterson administration will ask the Assembly to delay sending the bill to the governor’s desk, officials said, and will try to devise a new version of the legislation before a special legislative session next month. But the governor and mayor have so many objections to the current bill that it could be difficult to negotiate a new one with the Legislature in just a few weeks.

If the governor were to veto the bill, or leave it in limbo, he would be turning aside the most ambitious attempt in decades to overhaul the system, which includes groups ranging from the Metropolitan Transportation Authority to the Niagara Falls Bridge Commission, and which has been criticized as functioning as a shadow government with little oversight.

The Bloomberg administration has argued that the bill would unfairly infringe on the mayor’s power and that it contains a provision that would place prominent development projects in New York City at risk. Mr. Bloomberg has no official say in the matter, but he and the governor are on generally good terms, and their staff members have been discussing concerns about the legislation.

The governor’s office objects to a number of provisions, including one that would require the comptroller to review authority contracts of over $1 million — a restriction that Mr. Paterson and business groups say will be too time-consuming. They also oppose a provision that would require authorities to record and disclose all contacts with lobbyists because it appears to encompass contacts with officials in other government agencies or authorities.

Supporters of the bill argue that the dispute is about power, and that the governor’s office and the mayor fear that the bill would diminish their sway over the authorities, which are ostensibly independent.

The legislation’s main provision would create an independent budget office with an array of powers over state authorities, including the ability to issue subpoenas in investigations and to conduct regular audits.

Audits? Why would we want to audit unelected bodies that approve billions in contracts and expenditures? Isn't the honor system good enough?

The article continues with this important aspect of the bill, which apparently will not come to be:
The legislation also makes clear that people who serve on authority boards have a fiduciary responsibility to the authorities and their missions rather than to the mayor, the governor or the elected officials who appointed them. Mr. Bloomberg is especially opposed to that provision.

The mayor also believes restrictions that would prevent authorities from selling off their land for below fair market value could hamper a number of developments, including a $700 million East Harlem project, which includes 600 housing units for low- and moderate-income families, and the East River Science Park, a $700 million complex in Manhattan that the city hopes will make it a leader in biotechnology.
DING! DING! DING!
Yup, the Times forgot to mention the hampering this would do to the MTA's sweetheart deal with New York Times business partner Forest City Ratner, which allows Forest City Ratner to pay $20 million at closing and the equivalent of $80 million over 22 years at an incredibly low 6.5% interest rate for a 9-acre rail yard, appraised at $214.5 million in the heart of Brooklyn—a site Ratner CEO Chuck Ratner once called a "great piece of real estate."
“We strongly support increasing transparency among public authorities, but this bill is a step backward,” said Michelle Goldstein, the director of the mayor’s Office of State Legislative Affairs. “The proposed legislation would make authorities less accountable to the public and sharply curtail the city’s ability to build affordable housing, create jobs and develop additional community space.”

Peter E. Kauffmann, a spokesman for the governor, said Mr. Paterson wants an overhaul “implemented in a way that will bring real transparency and accountability to authorities without passing along added costs to taxpayers or stifling job growth through unnecessary delays to critical economic development projects.”
Yeah, right. Spare us your concern about taxpayer expenditures. We won't hold our breath on Paterson's version of a new bill.

The article continues:
The measure, adopted by the Senate in the wee hours near the end of its chaotic session last month, is one of the few actions to emerge from Albany this year that have been praised by editorial boards and civic groups. Many of the bill’s principles were drawn from a Pataki-era commission on authority reform led by Ira Millstein, a lawyer who is a leading expert on corporate governance.

The legislation has been promoted for years by Assemblyman Richard L. Brodsky, a Westchester Democrat who has investigated abuses at the transit authority and the Canal Corporation and, more recently, has scrutinized the financing of Yankee Stadium.

Mr. Brodsky said that Mr. Bloomberg’s concerns about property sales were a smoke screen because the city could easily award grants to developers instead of selling them land for below the market value.

“Their arguments are bogus,” he said. “It’s about power; it’s not about any particular projects.”
It's about both: power and particular projects. Atlantic Yards being the largest elephant in the room.
Mr. Millstein said that “if the fiduciary issue is what’s preventing support, I think that would be a shame.”

“The directors of public authorities surely should take into account the views of whomever it is that appointed them,” he added. “But thereafter, they must understand that they are fiduciaries for all the constituencies, and particularly the people of the state of New York.”

Senator Bill Perkins, a Harlem Democrat who was the chief sponsor of the bill in the Senate, said that taxpayers have too often been shortchanged in development deals.

“The whole purpose of this is to make sure that the public gets the best deal,” he said.

Expect more hearings on this issue from Senator Perkins.

(Update: Oder also publishes Assemblyman Brodsky's scorching statement on the coming veto:
"Real reform is never easy. Governor Paterson can protect the status quo, the mushrooming debt, the questionable and sometimes corrupt actions we repeatedly uncovered, or he can stand up for real change. The Legislature crafted the bill with almost no activity or interest by the Paterson Administration. The opportunity to raise questions was available and no interest was shown. And the arguments made by the Mayor and some in the Administration are simply bogus and untrue. We've seen the national health care debate poisoned by false allegations. We won't let the decision about true authority reform to fall victim to that tactic.")

Let's see what Brodsky will do about it.



Posted: 8.14.09
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Eminent Domain Case
Goldstein et al v. ESDC
[All case files]

November 24, 2009
Court of Appeals
Ruling

[See ownership map]

EIS Lawsuit

DDDB et al v ESDC et al
Click for a summary of the lawsuit seeking to annul the review and approval the Atlantic Yards project.

Appeal briefs are here.

2/26/09
Appellate Divsion
Rules for ESDC
What would Atlantic Yards Look like?...
Photo Simulations
Before and After views from around the project footprint revealing the massive scale of the proposed luxury apartment and sports complex.

Click for
Screening Schedule
of
Isabel Hill's
"Atlantic Yards" documentary
Brooklyn Matters


Read a review
-----------------------
Atlantic Yards
would be
Instant
Gentrification
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