Miraculously, New York State’s highest court, the Court of Appeals, has accepted an appeal of the Atlantic Yards eminent domain case! This case had been dismissed by a lower court in May of this year. The earliest the appeal would be heard by the court is mid October, and their decision would follow 6 or 8 weeks later, sometime around Thanksgiving. What this means for the developer, Forest City Ratner (FCR), is their goose (aka Atlantic Yards) is that much closer to the oven, and just in time for the holidays!
This is bad for FCR, and potentially fatal to its dream of Atlantic Yards. FCR is trying to beat the clock and break ground on the arena before the end of the year. If they are unable to break ground before December 31, 2009, then they will be ineligible to issue tax-exempt bonds to help finance the arena, as the loophole will then be closed by the IRS. If they can’t issue tax-exempt bonds, they must use less lucrative taxable bonds, increasing their costs to the tune of about $100,00,000. And that’s assuming they’re even able to sell the estimated $500,000,000 bonds they’ll need to pawn. And, this assumes that the court rules in their favor, which although likely, is certainly not guaranteed.
So, after the Empire State Development Corporation (ESDC) and the Metropolitan Transportation Authority (MTA) brazenly forked over more of our money to FCR just last week to keep the zombie proposal stumbling forward, the Court of Appeals may end up being the stake through the heart that kills this zombie once and for all.