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22.09.2018

‘Value-capture financing’ isn’t a silver bullet.

Memo to taxpayers: Beware of pols hawking “value-capture financing” as a magical way to fund new subways, bridges and so on. From Mayor de Blasio to Gov. Cuomo to President Trump, politicians are suggesting this is a painless way to raise cash for infrastructure. But it’s just one tool, not a cure-all. The idea is...
Time: 22:47     Date: 17.02.2018
Last US News - Opinion: ‘Value-capture financing’ isn’t a silver bullet. NY Post 24 - US News

From Mayor de Blasio to Gov. Cuomo to President Trump, politicians are suggesting this is a painless way to raise cash for infrastructure. But it’s just one tool, not a cure-all.

The idea is that a big public project, like a new subway station, will boost the value of nearby private properties, pushing up assessments and ginning up new tax revenue — which can be used to pay off the bonds that funded the project in the first place.

The model is Mayor Mike Bloomberg’s financing for the extension of the No. 7 line from Times Square to 34th Street and 10th Avenue. The subway was sure to help make the Hudson Yards development viable, so Bloomberg agreed to dedicate real-estate taxes on new buildings there to pay back the billions spent on the new subway.

Now Gov. Cuomo is talking about doing something similar to fund other MTA projects in the city, like the one to bring LIRR trains to Grand Central. Under his plan, the MTA would get 75 percent of any new tax revenue after such projects boost real-estate values.

De Blasio also floated the idea to pay for a light-rail line along the Brooklyn-Queens waterfront. And Trump’s new infrastructure plan seeks to force the use of value-capture financing on projects that get federal funds. All fair enough — if it’s done right, with an eye on the pitfalls.

One problem: It’s impossible to know how much of any rise in property values comes from a given project. The gimmick can easily divert more (or less) in dedicated funds than it really should.

Oh, and if the project turns out to not boost values, the new funds never show up.

Estimates of how much values will rise are just estimates — whereas bond covenants require a guaranteed source of income.

In the case of the No. 7 extension, the new revenue has yet to cover bond repayments — which has left the city making up the difference from its other revenues.

Plus: Hudson Yards was built from scratch — a high-end development on what’s now some of the most valuable real estate in the world, sitting above low-value railyards. That won’t be the case in many other places.

Finally, the scheme ought to target every property whose value rises thanks to the project.

The Grand Central upgrade, for instance, will largely benefit Long Islanders. But Cuomo’s plan doesn’t aim to “capture” any new tax revenue from the island.

In short, “creative financing” is a two-edged sword. It can be a fine way to finance infrastructure — or it can be highway robbery.

Opinion

Last US News - Opinion: RFK crew needs to rethink its ‘get out jail free’ cards for violent offenders. NY Post 24 - US News
RFK crew needs to rethink its ‘get out jail free’ cards for violent offenders.
Kerry Kennedy and her Robert F. Kennedy Human Rights outfit still have time to rethink their “bail them all out” initiative...
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The war on coal is a winner for China.
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Ridiculous confirmation fights are killing the Supreme Court.
The current era of scorched-earth politics began five years after there was, according to Christine Blasey Ford, in 1982,...
Last US News - Opinion: Now #MeToo is coming for your thought crimes. NY Post 24 - US News
Now #MeToo is coming for your thought crimes.
The #MeToo movement’s search for demons to slay has expanded well beyond just those accused of sexual misbehavior. Now,...

Opinion

Last US News - Opinion: RFK crew needs to rethink its ‘get out jail free’ cards for violent offenders. NY Post 24 - US News
RFK crew needs to rethink its ‘get out jail free’ cards for violent offenders.
Kerry Kennedy and her Robert F. Kennedy Human Rights outfit still have time to rethink their “bail them all out” initiative...
Last US News - Opinion: The war on coal is a winner for China. NY Post 24 - US News
The war on coal is a winner for China.
We’ve just entered the 21st month of Donald Trump’s presidency. While the president is ending his predecessor’s war...
Last US News - Opinion: Ridiculous confirmation fights are killing the Supreme Court. NY Post 24 - US News
Ridiculous confirmation fights are killing the Supreme Court.
The current era of scorched-earth politics began five years after there was, according to Christine Blasey Ford, in 1982,...
Last US News - Opinion: Now #MeToo is coming for your thought crimes. NY Post 24 - US News
Now #MeToo is coming for your thought crimes.
The #MeToo movement’s search for demons to slay has expanded well beyond just those accused of sexual misbehavior. Now,...
Last US News - Opinion: The limits of hashtag feminism and other commentary. NY Post 24 - US News
The limits of hashtag feminism and other commentary.
Legal file: Polygraphs Are a Joke Brett Kavanaugh’s accuser, Christine Blasey Ford, has taken a polygraph test. At City...

Living

US Living News: Human-bear conflicts are on the rise in Alaska. NY Post 24 - US News
Human-bear conflicts are on the rise in Alaska.
ANCHORAGE, Alaska — Wildlife experts are calling this summer one of the busiest years of bear encounters they have seen....
US Living News: Not every millennial wants free lunch, perks at work. NY Post 24 - US News
Not every millennial wants free lunch, perks at work.
I am a retired professional, and I volunteer at one of New York City’s public golf courses as a ranger. One individual...
US Living News: Former DJ buys $2.75M beer garden for oyster bar outpost. NY Post 24 - US News
Former DJ buys $2.75M beer garden for oyster bar outpost.
A Lower East Side champagne and oyster bar is replacing a beer and sausage joint in Montauk. Kristin Vincent, a former DJ...
US Living News: Routine laser treatment left me with blistering burns: suit. NY Post 24 - US News
Routine laser treatment left me with blistering burns: suit.
A Long Island mom went for a routine laser treatment to remove sunspots — and ended up with dozens of blistering burns...
US Living News: Maine officials: Getting lobsters stoned before killing them is now illegal. NY Post 24 - US News
Maine officials: Getting lobsters stoned before killing them is now illegal.
Maine government officials are not down with getting lobsters baked before boiling them alive, and have declared the practice...
US Living News: ‘Insecure’ shows how hard it is for a black girl to find love. NY Post 24 - US News
‘Insecure’ shows how hard it is for a black girl to find love.
When I moved to New York City in March of 2008, I thought my life would look a lot like Carrie Bradshaw’s from HBO’s...
US Living News: The best books of the week. NY Post 24 - US News
The best books of the week.
West Wingers: Stories from the Dream Chasers, Change Makers and Hope Creators Inside the Obama White House Ed. by Gautam...
US Living News: Why the inventor of the labradoodle regretted his creation. NY Post 24 - US News
Why the inventor of the labradoodle regretted his creation.
With its cutesy curls and plaintive eyes, it’s no wonder the labradoodle became America’s second-favorite dog in 2012....

Business

Last US Business News: Toys ‘R’ Us store was ‘complete chaos’ during closing. NY Post 24 - US News
Toys ‘R’ Us store was ‘complete chaos’ during closing.
Just after Memorial Day this year, the manager of a Toys ‘R’ Us store in Oregon decided to use up his vacation days....
Last US Business News: New Apple streaming service wants to be family friendly. NY Post 24 - US News
New Apple streaming service wants to be family friendly.
Apple wants its piece of Hollywood to be exclusively G-rated....
Last US Business News: Colbert dominates Fallon in late night for second year in a row. NY Post 24 - US News
Colbert dominates Fallon in late night for second year in a row.
The numbers are in, and the message is clear: It pays to bash President Trump on late-night TV. “The Late Show with Stephen...
Last US Business News: State unemployment regulations leave New Yorkers struggling. NY Post 24 - US News
State unemployment regulations leave New Yorkers struggling.
Dear John: Until recently, I was unemployed and as a white college-educated female in my 50s, I would gladly have worked...
Last US Business News: Con Ed won’t take on certain expenses because as a monopoly — they can. NY Post 24 - US News
Con Ed won’t take on certain expenses because as a monopoly — they can.
Dear John: I own a co-op apartment in which the gas meter is in the kitchen. It was determined that the gas meter was defective...
Last US Business News: US student debt might lead to the next financial crisis. NY Post 24 - US News
US student debt might lead to the next financial crisis.
In may not be trigonometry, but if you do the math, there is a great divide in how an estimated $2 trillion will be paid...
Last US Business News: Wall Street is high on Thiel-backed cannabis company. NY Post 24 - US News
Wall Street is high on Thiel-backed cannabis company.
America saw reefer madness take over the stock market last week. For a few months now, the budding industry has captured...
Last US Business News: Next crash will be ‘worse than the Great Depression’: experts. NY Post 24 - US News
Next crash will be ‘worse than the Great Depression’: experts.
Ten years ago, it was too-easy credit that brought financial markets to their knees. Today, it could be a global debt of...

Metro

Metro News: Homophobic bigot assaults two men in Brooklyn, both expected to survive: cops. NY Post 24 - US News
Homophobic bigot assaults two men in Brooklyn, both expected to survive: cops.
Cops are hunting for a homophobic brute after a Sunday morning attack in Brooklyn sent two men to the hospital,...
Metro News: Trump’s visit to the UN will be a traffic nightmare. NY Post 24 - US News
Trump’s visit to the UN will be a traffic nightmare.
“MAGA” will stand for “Make the Apple Gridlocked Again” as President Trump hits town for the UN General Assembly’s...
Metro News: Democrats see chance to knock out sole Republican senator in Brooklyn. NY Post 24 - US News
Democrats see chance to knock out sole Republican senator in Brooklyn.
Democrats believe they have the rare opportunity to knock out the sole Republican elected official left in Brooklyn — popular...
Metro News: Routine laser treatment left me with blistering burns: suit. NY Post 24 - US News
Routine laser treatment left me with blistering burns: suit.
A Long Island mom went for a routine laser treatment to remove sunspots — and ended up with dozens of blistering burns...
Metro News: Peace officers accused of stealing from homeless shelter. NY Post 24 - US News
Peace officers accused of stealing from homeless shelter.
Shelter residents are among the city’s most needy, but that didn’t stop three peace officers from swiping basic hygiene...
Metro News: Couple shocked to find they just bought infamous MS-13 house. NY Post 24 - US News
Couple shocked to find they just bought infamous MS-13 house.
Welcome to the “killing fields.” A young couple with three kids say they bought their dream home on Long Island Friday...
Metro News: Man fatally stabbed after fighting with childhood friend. NY Post 24 - US News
Man fatally stabbed after fighting with childhood friend.
A Brooklyn man was fatally stabbed following an argument with a neighborhood friend early Sunday, police and neighbors told...
Metro News: Molinaro unveils website seeking dirt on Cuomo. NY Post 24 - US News
Molinaro unveils website seeking dirt on Cuomo.
Republican gubernatorial candidate Marc Molinaro on Sunday unveiled a Wikileaks-style website for whistleblowers to reveal...

Sport

Last US Sport News: Josh Allen has calling card with biggest NFL upset in decades. NY Post 24 - US News
Josh Allen has calling card with biggest NFL upset in decades.
How good was Buffalo’s rookie quarterback Josh Allen in Minnesota on Sunday? By halftime, he had run for one touchdown...
Last US Sport News: Two basketball schools are taking college football by storm. NY Post 24 - US News
Two basketball schools are taking college football by storm.
When the weather cools down, the anticipation rises. Hopes soar. Excitement fills the air. At Kentucky and Syracuse, it usually...
Last US Sport News: Bruins castoff carries chip into first full year with Rangers. NY Post 24 - US News
Bruins castoff carries chip into first full year with Rangers.
Ryan Spooner needed a change. That much he made clear as he settles into his first full year with the Rangers following his...
Last US Sport News: Evan Engram injury a dark cloud hanging over Giants win. NY Post 24 - US News
Evan Engram injury a dark cloud hanging over Giants win.
HOUSTON — It looks as if the Giants are going to have to move forward without tight end Evan Engram, who was forced out...
Last US Sport News: Sports stars hit Midtown for Buoniconti Fund charity dinner. NY Post 24 - US News
Sports stars hit Midtown for Buoniconti Fund charity dinner.
The stars are coming out, legends in their respective sports, to help raise money for paralysis and spinal cord injuries....