More on the Death of Private Enterprise

The fix was never quite in for Forest City Enterprises and its plan for a casino in Station Square. But shed no tears for the company or honcho Bruce Ratner. He not only owns piddling little assets like the NBA's Nets franchise, he is also the driving force behind Atlantic Yards, a $4 billion development in Brooklyn that makes the Pittsburgh casino look like a couple of video poker machines at the local Elks Club. (The plans call for a new arena for the Nets, natch.)

NYC's Nurse Bloomberg, unbowed by controversy over what the project will mean for the existing neighborhood, calls it "the most exciting private development Brooklyn has ever seen."

Private development, eh? Here's what City Journal has to say about that:

Sure, a private-sector developer, Forest City/Ratner, conceived the plan to erect the stadium and an instant high-rise neighborhood of 6,430 apartments atop a 22-acre, seven-block “footprint” of central Brooklyn (railyards owned by the state’s Metropolitan Transportation Authority occupy about 40 percent of the area, but the rest of the “project site” is already a developed neighborhood).

But this private-sector veil doesn’t mean Atlantic Yards is anything other than a centrally planned, public-sector project. FC/Ratner could never pursue Atlantic Yards without a half billion dollars in public subsidies, the government’s power to condemn private property, and exemptions from city zoning rules.

Comments

[Jonathan Potts]

Incidentally, I was at Station Square a few weeks ago, and I noticed several empty stores and shuttered restaurants. The Station Square expansion was funded in part through tax-increment financing.

I once read the statistic, that something like %85 of NY develpers get an exemption to the zoning law. What is a rule that doesnt apply %85 of the time, if not just an invitation to political corruption.

[Mark Anderson]

Generally I agree with the idea that government should stay out of real estate development. However, the GAF plant in Erie has significant hazardous waste issues that no private enterprise will touch. This actually is a case where the government needs to step in, buy the property, clean it up and then sell it to a developer. Unfortunately I don't think GAF is required to pay for the cleanup - they could just let it sit there.