Fiscal Cliff Deal: Goldman Sachs gets $1.6 billion tax free financing for New Headquarters

[AZ Progressive]

http://www.alternet.org/news-amp-politics/8-huge-corporate-handouts-fiscal-cliff-bill

"5) Subsidies for Goldman Sachs Headquarters – Sec. 328 extends “tax exempt financing for York Liberty Zone,” which was a program to provide post-9/11 recovery funds. Rather than going to small businesses affected, however, this was, according to Bloomberg, “little more than a subsidy for fancy Manhattan apartments and office towers for Goldman Sachs and Bank of America Corp.” Michael Bloomberg himself actually thought the program was excessive, so that’s saying something. According to David Cay Johnston’s The Fine Print, Goldman got $1.6 billion in tax free financing for its new massive headquarters through Liberty Bonds."


Lots more goodies given out to other industries as shown in the article.

[ProSense]

1. Why do people have to distort the facts?

"5) Subsidies for Goldman Sachs Headquarters – Sec. 328 extends “tax exempt financing for York Liberty Zone,” which was a program to provide post-9/11 recovery funds. Rather than going to small businesses affected, however, this was, according to Bloomberg, “little more than a subsidy for fancy Manhattan apartments and office towers for Goldman Sachs and Bank of America Corp.” Michael Bloomberg himself actually thought the program was excessive, so that’s saying something. According to David Cay Johnston’s The Fine Print, Goldman got $1.6 billion in tax free financing for its new massive headquarters through Liberty Bonds."

Stoller links to a January 2012 article about a past loan to make the claim that this is specifically for Goldman Sachs.

'Fiscal cliff' deal extends New York rebuilding bonds

Jan 2 (Reuters) - Congressional lawmakers added a provision into legislation on avoiding the U.S. "fiscal cliff" that extends for two years issuance of Liberty Bonds, the debt authorized after the Sept. 11, 2001, attacks to help rebuild New York, according to a copy of the bill.

Liberty Bonds are unlike many sold in the $3.7 trillion tax-exempt m unicipal bond market - they are issued by the New York Liberty Development Corporation to make loans to companies and they are solely secured by loan payments from those companies. The corporation is an arm of the state-controlled Empire State Development, which was created to help finance rebuilding in lower Manhattan.

For example, $1.24 billion of revenue bonds sold in 2005 were used for a loan for building the headquarters of Goldman Sachs. Those bonds are repaid with money Goldman puts toward its loan. This allowed Goldman to borrow at tax-exempt rates, which are often lower than corporate ones.

The bond program was set to expire at the end of 2012, but the late-night deal on the combination of tax and spending changes that had made up the "fiscal cliff" included an extension through 2014.

Goldman was the lead manager on the last sale of the bonds, $1.65 billion of new and refunding revenue debt, in July. JP Morgan was the lead underwriter for the previous sale, in March, of $450 million revenue refunding bonds.

http://www.reuters.com/article/2013/01/02/municipals-liberty-idUSL1E9C2AKA20130102

[SidDithers]

5. Oh, it's Matt Stoller...

Sid

[bluestate10]

7. Thanks for facts. Lower Manhattan is still being rebuilt, so extension of tax-exempt financing

is appropriate.

[Mojorabbit]

2. I can't even get outraged anymore. It is just a travesty. nt

[Autumn]

3. Why on earth is any type of tax exemption included in legislation by our Congress

or Senate to provide post-9/11 recovery funds for a Goldman Sachs Headquarters ? I don't get it.

[farmbo]

4. Stop already! These bonds are being used to rebuild NY & NJ...

after Hurricane Sandy. These Liberty bonds are some of the most efficient stimulus spending authorize in the entire Bill.

Yes... the Great Satan, Goldman Sachs, will use them to build a new HQ, but so will scores of other businesses and local governments.

I know it interferes with the "Obama caved!!" narrative, but Liberty Bonds create jobs in the short run, provide economic stimulus, and make sense on many levels.

[ProSense]

6. If you're going to yell "stop"

"Yes... the Great Satan, Goldman Sachs, will use them to build a new HQ, but so will scores of other businesses and local governments."

...get the facts straight. Goldman Sachs isn't buidling a new HQ. They started building it in 2005, and it opened in 2009(http://en.wikipedia.org/wiki/200_West_Street#Financing).

[farmbo]

8. Goldman Sachs has already made their killing....

The additional bonding authority approved yesterday ($9 billion, I believe) should, perforce, go to new projects.