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State OKs Ratner’s Atlantic Yards; Green light opens floodgates for billions in subsidies

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The political battle over the biggest real-estate development in Brooklyn’s history is over — and Bruce Ratner has won.

The state’s Public Authorities Control Board voted Wednesday to approve Forest City Ratner’s Atlantic Yards project, giving a final governmental nod to the $4-billion, Frank Gehry-designed mini-city of 16 towers, hundreds of thousands of square feet of office and retail space, 6,430 apartments, and a 19,000-seat basketball arena.

The historic vote capped three years of rancorous debate, but the battle now becomes a judicial one, with suits challenging eminent domain condemnations pending in state and federal courts.

“I trust that the courts will give this project a thorough review, something that has not happened in any legislative body,” City Councilwoman Letitia James (D-Prospect Heights) said. “Until the courts rule on the pending and upcoming cases, Atlantic Yards as we know it cannot be built.”

Brooklyn would forever be altered by this project, whose chief state advocate, Empire State De velopment Corporation Chairman Charles Gargano, said would bring a “Manhattan” sensibility to the borough.

“Atlantic Yards will transform a largely underutilized and blighted area into one of the most spectacular and dynamic mixed-use communities in the nation,” Gargano said in a statement.

The project’s most-visible Brooklyn backer, Borough President Markowitz, focused on the “thousands” of union construction jobs and the 2,250-units of below-market-rate rentals that proponents say would be created by the project.

Markowitz also cheered Ratner for bringing Brooklyn back to the “major leagues” almost 50 years after the Dodgers abandoned the borough. Ratner plans to move his New Jersey Nets into the Atlantic Yards arena.

Opponents of the project complained of an approval process tainted by cronyism, sweetheart deals and billions of dollars in hidden public subsidies.

“The community deserves to know how much this project will cost — and we do not,” said Councilwoman James.

Beyond the financial cost, foes said Ratner’s project would turn quiet Prospect Heights into Times Square and put a Madison Square Garden in the heart of a residential neighborhood.

Before Wednesday’s vote, Assembly Speaker Sheldon Silver — one of the three men who control the PACB — voiced similar concerns. But after a day of lobbying by ESDC officials on Tuesday, the Democratic Speaker cast his vote with Republican rivals Gov. Pataki and Senate Majority Leader Joe Bruno, claiming that he had finally been shown documents that convinced him of Atlantic Yards’ economic viability.

The documents included a secret analysis prepared by the outside accounting firm, KPMG. A copy was also provided to the New York Times, which is a partner of Ratner’s on its new Midtown headquarters.

According to the Times, the KPMG study showed that Ratner expects to make a return of about 10 percent on his investment — but critics said his profit would be higher, thanks to subsidies he’ll receive.

The project has already gotten $200 million in direct state and city subsidies, and Ratner was allowed to acquire MTA property at less than the appraised value. It will also receive $1 billion in tax abatements, housing subsidies, and low-interest bonds, according to ESDC.

Opponents of the project say the public costs are much higher — and the public benefit much lower.

When proposed in 2003, Ratner said Atlantic Yards would pump $6 billion in tax revenues into the local economy over the next 30 years. That number fell to $1.4 billion this summer, and dropped again to just $944 million last week, ESDC said.

Disregarding such numbers, Silver claimed that Ratner had made last-minute concessions, such as cutting down the proposed 620-foot-tall “Miss Brooklyn” tower to 511 feet — one foot shorter than the borough’s iconic Williamsburgh Savings Bank clocktower; committing to placing 200 affordable condo units on-site rather than nearby, as he’d previously promised; helping to build a new high-tech high school in the area; and coughing up $3 million for neighborhood parks surrounding his eight-million-square-foot superblock Xanadu.

Silver also won a victory for his Lower Manhattan constituents by pushing the developer to trim the amount of office space in Atlantic Yards, lest it compete with commercial properties in Silver’s district.

“I am pleased that the developer is committed to addressing numerous community concerns through several specific actions that will result in significant neighborhood improvement,” Silver said in a statement following his approval vote.

Ratner thanked him — and Pataki and Bruno — right back.

“We are very thankful … for their support and today’s approval,” Ratner said in a statement after the state’s so-called “three men in a room” voted.

Critics charged that Ratner’s “concessions” didn’t go far enough.

“The inclusion of affordable home ownership in the Atlantic Yards project is a significant step forward for our community,” said Assemblyman-elect Hakeem Jeffries (D-Prospect Heights), but added that, like other officials, he wanted more changes after Eliot Spitzer takes over as governor on Jan. 1.

“I expect to work closely with the Spitzer administration to address the quality-of-life and density concerns that many in the community, including myself, continue to have” about Atlantic Yards, Jeffries said.

The fight will now move to the courts, where at least two lawsuits have been filed against Ratner and state officials over the use of eminent domain to seize properties for Ratner’s benefit.

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