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March 28, 2008
Is arena facing all new review?
The Brooklyn Paper
By Gersh Kuntzman
Might the proposed Nets arena have to go back to the Public Authorities Control Board for approval because the cost of the arena has grown from $637.2 million to $950 million since is was approved just 15 months ago?
“The reason the PACB exists is to look at the entirety of the financing package for this project,” said Lawrence Schillinger, a lawyer for Develop Don’t Destroy Brooklyn.
“A 50-percent increase in the cost of the arena substantially changes the financials of the project.”
Another DDDB lawyer, Jeff Baker, agreed, saying that the PACB’s approval of the project in December, 2006 assumed a 7.6-percent profit for the developer.
If his costs have skyrocketed, that profit will be smaller — making it less likely that the project is economically viable and will not require additional government subsidies to make it work.
“As such,” Baker said, “the PACB needs to review it again.”
Both lawyers said they were willing to take the matter to court, but, for now, were more interested in making their argument in “the court of public opinion,” Schillinger said.
“People need to look at how government spends money,” he said.
“This kind of bonding scheme is exactly what the state did 30 years ago. We don’t want to repeat those mistakes.”
Posted by steve at March 28, 2008 5:30 AM