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October 16, 2008

Kucinich schedules hearing October 24 on Yankee Stadium and future of PILOTs

Atlantic Yards Report

Rep. Dennis Kucinich (D-OH), Chairman of the Domestic Policy Subcommittee of the House Committee on Oversight and Government Reform, yesterday announced a hearing October 24 during which Seth Pinsky, President of the New York City Economic Development Corporation, and Randy Levine, President of the New York Yankees, are expected to answer tough questions about the deal to use PILOTs (payments in lieu of taxes) to repay bonds for the new Yankee Stadium. The hearing also may cast doubt on a similar plan for the Atlantic Yards arena.
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The hearing will examine not only whether the [Yankees] stadium valuation was "gamed" but also "whether the City’s efforts to stop finalization of proposed U.S. Department of Treasury regulations that would effectively prohibit the use of PILOTs in this context serve the public interest."

That larger issue points directly to the city's effort to get tax-exempt bonds for the Atlantic Yards arena grandfathered in under the same loose 2006 ruling--which the chief counsel of the IRS called a "loophole" the agency immediately proposed to close--that enabled PILOTs for the new Yankee Stadium and Mets stadium.

The difference, as I've written, is worth perhaps $165 million to Forest City Ratner on $800 million worth of tax-exempt bonds. And this issue, more than any other, may be the biggest hurdle facing the arena.

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Posted by lumi at October 16, 2008 6:01 AM