It's Queens Magazine
The insurance giant released data earlier this month showing it distributed $8.5 billion in federal bailout money to the British bank Barclays, which has a $400 million naming-rights deal for the Nets arena planned for Atlantic Yards.
Now, Councilwoman Letitia James and Atlantic Yards opponents are calling on Barclays to cancel its naming-rights deal, arguing that the bank could use the federal bailout funds to help finance the contract at a time when taxpayer dollars shouldn't be wasted on the naming of sports arenas.
The beleaguered American Insurance Group, currently embroiled in a national scandal over lavish executive bonuses, released a list in mid-March of the payments it has made to financial institutions, among them Barclays, from its $170 billion federal bailout package.
The news quickly spread across the Brooklyn blogosphere as angry residents speculated that Barclays would use part of its A.I.G. money to finance the $400 million naming rights deal.
A Barclays spokesperson declined to comment or confirm if the bank does indeed plan to finance the naming-rights deal with taxpayer monies it was paid by A.I.G.
In a statement, Councilwoman James called the revelation "staggering," and said if Barclays is planning to do so, which appears likely, it would be a gross violation.
"Taxpayers are more willing to support efforts to free up lending for critical needs, but they will not and should not support frivolous naming rights deals like this one," James said. "This is why I'm calling on Barclays and Ratner to terminate their deal regarding naming rights for the proposed arena."
James said the original intent of the Troubled Assets Relief Program (TARP) - passed by Congress last fal to help revive the economy -would be compromised if the bank is allowed to exploit public spending for private gain.
"There should not be even the slightest hint that taxpayer money will be used to enrich a private developer and a British bank," James added.
Daniel Goldstein, the spokesman for Develop Don't Destroy Brooklyn (DDDB), a leading opposition group to Atlantic Yards, argued if taxpayers end up footing the bill for Barclays it would only add insult to injury to residents opposed to the project.
"They don't have any business financing an arena in Brooklyn that many people don't want. This is even worse," Goldstein said. "The federal bailout of AIG was not intended to assist Barclays in hyping its brand in Brooklyn."
In January of 2007, Barclays announced it would spend $400 million, over the course of 20 years, for the privilege of having the new Nets arena named the Barclays Center. In November of 2008, the British bank reaffirmed its commitment to the deal around the same time that A.I.G. was given a series of federal bailouts.
Goldstein compared the naming-rights scandal in Brooklyn with the criticism that surrounded Citigroup's decision to go ahead with a $400 million plan of its own to name the new Mets stadium Citi Field, even after it received $45 billion in federal funding.
At the time, Treasury Secretary Timothy Geithner supported Citigroup's decision, though Congressman Barney Frank, the chair of the Financial Services Committee in the U.S. House of Representatives, said similar naming rights deals would be banned in the future.
"When Congressman Frank learns of yet another instance of bailout funds going towards a lucrative naming rights deal," Goldstein said, "we expect that he will not be pleased and will quickly take action."
Post a Comment