Shelly Silver: Wrong, wrong, wrong

Editorial

In the end, there was no reasoning with Sheldon Silver, nor was the Assembly speaker open to good-faith negotiations. Dead set on smothering development on Manhattan's West Side, he voted down the $2.2 billion stadium and convention center planned for the area. His stubborn, high-handed wrong-headedness was breathtaking.

Silver created many losers and only one winner. Thanks to him, New Yorkers lose out on getting a state-of-the-art arena that would have more than paid for itself through increased tax revenue; subway and bus riders lose out on as much as $2 billion for the Metropolitan Transportation Authority; construction workers lose out on thousands of jobs; the hotel and tourism industry loses out on an influx of convention visitors, and the city loses a shot at hosting the 2012 Olympic Games.

Silver's lone beneficiary in this very bad bargain was Cablevision, the cable TV giant that spent millions of dollars on lobbying and public relations campaigns to defeat the stadium as a way to protect Madison Square Garden from competition. Among Cablevision's hooks was Silver's former top aide Pat Lynch. The company, apparently, got its money's worth.

The speaker justified blocking the state from investing in the stadium as a way to ensure that nothing distracts from development at and around Ground Zero, which is located in his Assembly district. He portrayed the stadium as a threat to lower Manhattan because it might encourage building in the Hudson Yards, a nearby 59square-block West Side area that the City Council has rezoned for office and residential development.

Silver's logic linking the stadium to the future of lower Manhattan is so specious that Mayor Bloomberg has good grounds to suspect the speaker of bad faith. The impression is only heightened by the fact that, after signaling he was open to wooing, Silver rejected with barely a shrug Bloomberg's offer to slash development incentives inside Hudson Yards and boost them downtown.

And City Hall's offer was substantial. The key elements for downtown included waiving the commercial rent tax in whole or in part for five years for all Manhattan below Chambers St. and for 12 years on the World Trade Center site, as well as providing a $5-per-square-foot rent subsidy to the first batch of tenants who signed leases in 7 World Trade Center or the Freedom Tower. Meanwhile, developers who built in the Hudson Yards would have to pay the equivalent of full real estate taxes for three years, and the charges would later be at least 10% higher than those downtown.

No one knows what, if anything, would have satisfied Silver. It is clear, though, that he labors under a fundamental misconception about government's ability to entice office tenants to lower Manhattan with financial incentives. Tax and rent breaks may work for a few companies, but most businesses today express a marked preference for being closer to midtown.

Many are looking for space in new buildings that have large floor plans, requiring the assemblage of big parcels of land. At the same time, financial service companies, traditional downtown residents, are seeking to diversify where they do business to blunt the impact of an attack or disaster at any single location. That's why downtown is so slow in coming back and why the Hudson Yards are drawing intense interest.

Killing the stadium will do nothing to change these basic market forces. Seven World Trade Center is not going to get paying tenants just because Silver barred the Jets from building a stadium several miles uptown. Nor will the Freedom Tower fill up because Silver refused to let the MTA sell the development rights over its railyard to the Jets for a hefty sum.

The speaker doomed the stadium by abstaining on a Public Authorities Control Board vote as hardhats called for his head. Senate Majority Leader Joe Bruno abstained, as well. He was just as wrong, even as he clung to the fig leaf that he would support the stadium if the International Olympic Committee chose New York for the Games. The IOC gave the city's bid a good review yesterday. Say adieu to all that.

Say goodbye, too, to New York's reputation as a forward-looking city that welcomes sound business investment. The Jets had planned to pour $1.6 billion into the stadium, and they were unceremoniously sent packing. The team says it will consider whether it can build without Silver's blessing. Let's hope so.