Port Authority's inability to rebuild quickly at WTC site will cost taxpayers
BY DOUGLAS FEIDEN
DAILY NEWS STAFF WRITER
Monday, May 12th 2008, 4:00 AM
Photos by Zuma and AP
Goldman Sachs CEO Lloyd Blankfein got (c.) sweet deal from Mayor Bloomberg (l.) and George Pataki.
New Yorkers are on the hook to hand over $321 million to Goldman Sachs, America's richest investment bank, because the Port Authority failed to rebuild the World Trade Center as fast as promised.
Under the hidden terms of a deal that then-Gov. George Pataki and Mayor Bloomberg approved in 2005, the city and state agreed to pay huge penalties to the firm if the Port Authority didn't complete major portions of the Ground Zero redevelopment by next year, a target now impossible to meet.
Goldman wanted speedy construction because the Wall Street giant is building its own $2.4 billion tower across from the site on West St.
Now, Goldman could snare 64 years of free rent worth $161 million that it's supposed to pay for leasing the state land. Goldman could also recoup an additional $160 million in sales tax payments.
The sweetheart deal okayed by Bloomberg and Pataki also provided $1.65 billion in tax-free Liberty Bonds and a $115 million incentive package. At the time, the bank was threatening to decamp to New Jersey.
In return for constructing its 43-story office building for 9,000 employees, Goldman was allowed to put $161 million it owed in rent and $160 million in sales taxes into escrow accounts, documents show. Albany and City Hall agreed that Goldman could keep its cash if two conditions were not met:
- Specific blockbuster transit-and-security projects on the Trade Center footprint had to be finished by the end of next year, when Goldman's tower will be finished. Officials concede that's not going to happen - and that the projects are years behind schedule.
- A comprehensive security plan for downtown had to be "implemented" before 2010. That counterterrorist plan can't be fully "implemented," as the deal requires, until the structures at Ground Zero are in place.
The bottom line: The $321 million bonanza in tax and lease payments could soon revert to the Wall Street powerhouse, which piled up $11.6 billion in profits last year.
Goldman spokeswoman Andrea Raphael declined to comment, but in a Securities and Exchange Commission filing four months ago, the firm made note of the escrow deal and implied it could be pocketing the ground-lease payments.
"Under the terms of the ground lease, we made a lump-sum ground rent payment in June 2007 of $161 million, which was paid into escrow, to be released to the Battery Park City Authority pending performance of specified state and city obligations," it said.
State officials wouldn't discuss specifics - even though the document they refused to discuss can be found on the SEC Web site. City officials think they're off the hook.
"The city is on track to provide a comprehensive security plan for lower Manhattan by the end of 2009 as required by the agreement, and we are working with the Port Authority and Lower Manhattan Development Corp. to help them meet the other deadlines," said Deputy Mayor for Economic Development Robert Lieber.
Lawyers are likely to argue this point: How can a security plan for Ground Zero be "implemented" by 2010 if none of the iconic buildings at the site are wrapped up by that time?
Sources close to the deal said only that the state and city are in preliminary talks with Goldman to win a bit of flexibility.
"The state and Goldman Sachs have and continue to have productive conversations on ensuring that downtown is rebuilt in a manner that is fair to both workers and residents and, of course, all taxpayers," said Avi Schick, chairman of the LMDC.
Among the projects supposed to see ribbon cuttings by 2010:
- The Transportation Hub: With its soaring wings designed to resemble a bird in flight, the PATH terminal was originally planned to open in 2006. A new report says there's less than a 5% chance of the hub being complete before July 2012.
- The Vehicular Security Center under Liberty St.: A centerpiece of security operations, this is the planned $478 million subterranean complex through which delivery trucks and buses will access the 16-acre site. Construction of the high-tech security checkpoint can't even start until the toxic former Deutsche Bank tower above it is finally demolished. The latest estimated opening date is 2011 or 2012.
dfeiden@nydailynews.com
Of course, the taxpayers..."The state and Goldman Sachs have and continue to have productive conversations on ensuring that downtown is rebuilt in a manner that is fair to both workers and residents and, of course, all taxpayers," said Avi Schick, chairman of the LMDC.
Steel Falls 18 Floors Onto Field
By THE ASSOCIATED PRESS
Published: May 18, 2008
The city has stopped construction on an office tower near ground zero after a chunk of steel fell 18 stories onto a ball field where children were playing on Saturday afternoon.
The Department of Buildings said no one was hurt in the accident at 200 Murray Street, where the Goldman Sachs headquarters is under construction. The builder, Tishman Construction, was cited with five violations.
The acting buildings commissioner, Robert D. LiMandri, called the accident “unacceptable.” Tishman had no comment.
At the same site in December, a crane dropped seven tons of metal studs, seriously injuring an architect in a trailer below.
http://www.nytimes.com/2008/05/18/ny...ion&oref=login
Copyright 2008 The New York Times Company
second major accident of this nature at this site. the only way i see more precations taking place to prevent such incidents is if the property owner receives as much negative exposure as the builders. you can be rest assured if such incidents become a direct reflection on GS in the public's eye that GS will make this the safest site in all of NYC.
Work Still Stopped At Goldman Sachs Bldg. After Falling Debris
By Nick Pinto
POSTED MAY 19, 2008
Ten-year-old Alexander Monticiollo was playing left field for his Downtown Little League team, the Dodgers, May 17, but he kept getting distracted by the insulation material drifting down onto the field from the Goldman Sachs tower under construction nearby.
“He kept pointing it out to me, but it was very light against the light sky, so I couldn’t see it,” said Doug Monticiollo, Alexander’s father. “That’s when the steel fell.”
The 30-inch-square steel plate sliced through the sky from the 18th floor of the construction site, embedding itself six inches in the outfield turf, just 20 feet from Alexander.
“It made a huge sound, like a big beam coming down,” Doug Monticiollo said. “It scared everybody.” To Alexander, it sounded more like “a whole bunch of air rushing, like a giant storm.” Linda Casper, who was also watching the game, didn’t see the impact either, but heard it.
“It was like a meteor had just hit center field,” she said.
Linda’s son Theo Levine was catching for the Dodgers at the time, so he did see the steel fall.
“It was green and falling very fast,” he said. “I thought that it was just a piece of wood, not metal.”
Downtown Little League officials reacted quickly, clearing the field and calling 311 and 911.
Inspectors from the Department of Buildings soon arrived and issued a stop-work order for the site and five violations to Tishman Construction, the contractor at the Goldman Sachs building. The violations remained in effect as of May 19.
Although the city generally requires high-rise construction in residential neighborhoods to stop on weekends, it makes exceptions, and Tishman was allowed to be on the job site May 17. The steel plate that fell on the baseball diamond was being used as a ramp to load drywall, however – an activity Tishman did not have a permit for that day.
It wasn’t the first time construction debris has fallen from the building.
Last December seven tons of metal studs plunged from the building, ripping through a construction trailer and paralyzing the architect working inside.
With the stop-work order in place, Little League play continued on the field the next day, but Downtown Little League President Mark Costello said something must be done to insure that nothing worse happens in the future.
“We feel the weekend construction should stop, at the very least for the rest of the season,” Costello said. “We have four remaining weekends of games this summer. They shouldn’t be working during that time.”
Doug Monticiollo said the incident raised new fears about future seasons, when there will be more construction even closer to the Battery Park City ballfields.
“There are two more buildings going up right next door,” he said, referring to the residential complex under construction on the field’s western edge.
“How can we have a safe environment here? A lot of people are upset at Battery Park City for allowing building so close to the fields.”
Spokesmen for the Battery Park City Authority and Tishman Construction did not return phone calls by press time.
http://www.tribecatrib.com/news/news...l06080009.html
The Tribeca Trib · 401 Broadway, 5th Floor · New York, NY · 10013 · 212.219.9709
That's not the issue.“How can we have a safe environment here? A lot of people are upset at Battery Park City for allowing building so close to the fields.”
Stuff shouldn't be coming down from a building going up anywhere.
it's an idoitic comment. apparently that fool has never walked the border of central park. or many other parks/fields in this city.
It appears, they tried to keep the construction and ball players apart, but this is worrying.
Although the city generally requires high-rise construction in residential neighborhoods to stop on weekends, it makes exceptions, and Tishman was allowed to be on the job site May 17. The steel plate that fell on the baseball diamond was being used as a ramp to load drywall, however – an activity Tishman did not have a permit for that day.
I have quite a number of family members in the building trades and they even are surprise by the amount of accidents that has been happening around the city . They told me all during the years you will hear accidents happen here in there but not like this.
Because of the GS maneuvering over "security issues," construction got off to a late start. And it seemed like progress was slow because the foundation took so long. But drilling caissons and digging out riverfront landfill was complicated, and the job was finished on schedule.
The construction schedule has been aggressive. I've seen this building just about daily. They work late into the day, and usually on Saturday. With room at the site to deliver material, the building shot up quickly. It was at street level in Feb 2007. BOA was at street level in Dec 2005.
This problem would have never of had happened if they didnt build the park down there on the land that was originally zoned for commerical.
The ball field site was originally a commercial site and if it had been built that way the ball fields would have been in another area and this wouldnt have happened.
In my opinion BPC has been a total waste and loss since it should have been completly used for Commercial development thus lessening the impact of Western NJ construction, but to late for that. Im just glad that Site 26 went to Goldman and not to Related or Brodsky for another lame condo.
For residents of BPC Im sorry if this post offened you but this is a forum and felt the need to make my point.
Yeah, the debris would have fallen on office workers instead. Mostly smokers in front of the building, so who cares.Originally Posted by kliq6
The ballfield area wasn't strictly commercial, but mixed-use. The air-rights were moved to the buildings along River Terrace, which were originally to be about 12 floors, and the two Milstein sites on the western edge of the ballfields got increased height.
There was not much market for commercial development in that area, even in the 90s. The River House site was intended to be an office building with the library in the base, but there were no takers.
One of the few public developments in the city that not only has been successful, but generated excess profits. Or do you think that the only way this city generates income is through commercial rents?In my opinion BPC has been a total waste and loss
Mainly yes it does in terms of property tax. Commercial buildings are much much more profitable
BPC is heavily funded through the state and with other city/state bonds so your point its this profitable place is way off base.
Your point on the offfice workers and falling debris however is true and I was off on that.
The bonds financed the initial development.
BPC has turned a profit every year, the excess turned over to the city.
let me guess, kliq is NJ.
re BPC, an undeniably fabulous addition to the city - one of my favorite parts of manhattan.
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