The ever-epic Norman Oder of Atlantic Yards Report today closes out his epic series on Bruce Ratner’s bizarre green-cards-for-financing scheme with a (wait for it) epic FAQ on exactly how the New Jersey Nets Brooklyn New Yorkers co-owner plans to take advantage of an obscure federal job-promotion program to save himself a jabillion dollars.
It’s a great read if you’re an economic development policy wonk; not so much if you’re looking for something you can read on your phone during your morning commute and then convert into a Facebook status update. So, without further ado, here’s the considerably-less-epic “The Great Ratner Green Card Fiasco: Who, If Anyone, Is Getting Screwed and How?”
- The heart of the deal: 498 Chinese millionaires loan Ratner $500,000 apiece for five years (or maybe seven) at no interest, as part of a federal program called “EB-5” that fast-tracks green cards for foreign investors who create new U.S. jobs. The green-cards-for-sale element isn’t actually controversial here — unless you’re the kind of person who gets their knickers in a twist that for the last 20 years the U.S. has been letting rich foreigners buy their way out of the immigration waiting list. But as Oder points out, since Ratner would be using his $249 million in free yuan to fund stuff he has to build anyway, it’s tough to argue that this is creating “new” jobs. Screwed: Worthier projects elsewhere (though EB-5 is currently undersubscribed, applications are expanding like gangbusters), and potentially less-well-heeled immigrants who might be eligible for visas if not for the 10,000 a year reserved for EB-5.
- Ratner’s sales pitch in China is, to say the least, a bit disingenuous: The promotional materials are covered with images of Nets players, even though the Chinese investors’ money would be used entirely to replace an existing “land loan” and help build a railyard. (Make your own joke about how watching a railyard would be more entertaining than watching the Nets these days.) And the only collateral on the loan is the right to develop Ratner’s vaportecture surrounding development, which may or may not ever be financially viable depending on whether the Brooklyn housing market ever rebounds. Screwed: A bunch of rich Chinese hoops fans, if China keeps torpedoing the world economy for its own self-interest.
- Twisted economic development principles, scammed Chinese millionaires — what does any of this matter to people in The 718? Okay, okay, how about this: Remember how the original plan for Ratner’s Atlantic Yards project was supposed to involve lots of condo towers, including a large number of affordable rental units? (Though there’s some debate over just how affordable they’d be.) Well, according to a new “Recognition Agreement” signed by the state Empire State Development Corporation on October 5, if Ratner defaults on his EB-5 loans, the Chinese investors get a seven-year extension on the deadline to build the first phase of the promised housing — meaning it might not be complete until 2029. And Phase 1 is only about half of the total promised housing, meaning we could be looking at Atlantic Lots for a generation or more. Screwed: Brooklynites who’d rather live next to yuppies than to parked cars.
All in all, it’s not the biggest scandal to hit Brooklyn in recent memory — it’s probably not even the biggest scandal to hit Atlantic Yards — but with secret trips to China, low-level staffers signing off on government documents, and Marty Markowitz starring in Chinese-subtitled videos, it may well be the most entertaining. Is Jackie Chan still in the market for Police Story plotlines?