| Company |
Bank of America
See (terminated) 1993 deal |
| Date Approved | 2/10/04 |
| Project Site | One Bryant Park (new tower co-developed with Durst Organization) & 100 West 33rd Street, 335 Madison Avenue, 9 West 57th Street, and 40 West 57th Street |
| Competing Sites | Charlotte, North Carolina |
| Type of transaction/ Company type | Commercial Retention / Financial |
| Maximum City Subsidy | $42 million |
|
$9.5 million |
|
$32.5 million |
| Type(s) of City benefits |
Sales and use tax exemptions - $6.0 million in retention benefits and up to $32.5 million in growth benefits to be earned on a per-employee basis. Energy benefits through Con Ed's Business Incentive Rate (BIR) - up to $3.5 million in Con Ed's Business Incentive Rate. Liberty Bond financing - $650 million for the project received preliminary approval from the NYC Industrial Development Agency on September 30, 2003. |
| Benefits from New York State | A total of up to $40.6 million in benefits to be conveyed through the ground lease at One Bryant Park held by the Empire State Development Corporation (ESDC) include Payment In Lieu Of Taxes (PILOT) savings of up to $26.2 million on real property taxes and a $14.4 million waiver of mortgage recording taxes associated with the Liberty Bond financing. |
| Total Benefits Allowed | $82.6 million plus savings on lower interest rates conveyed by $650 million in tax-exempt Liberty Bonds |
| Benefits Distributed to Date | 0 |
| Promised Job Retention | 2,995 |
| Projected job growth |
2,896 |
| Total Promised Jobs | 5,891 |
| Jobs Reported in LL69 Report FY 2002 | NA |
| Layoffs | Up to 13,000 layoffs are reported to result from Bank of America's acquisition of FleetBoston. It is not yet clear where these layoffs will come from. However, Fleet employees are excluded from the job requirements included in this deal. |
| Length of Contract | 25 years |
| Project Purpose | This second subsidy was given to induce the Bank of America to stay and expand in a new major office tower rather than moving employees to Charlotte, NC, where it is based. However, the benefits can also be used at existing offices, most of whose leases are due to expire in the next few years. |
| Clawbacks | The second Bank of America subsidy has unusually strong recapture terms that impose penalties if jobs are not created and if newly created jobs are not retained. See term sheet for details. |
| Background/Since then . . . |
Bank of America's acquisition of FleetBoston
will leave Bank of America responsible for the Quick &
Reilly subsidy agreement with the city inherited by Fleet. Bank of America has been involved in a number of corporate scandals, including allegations of after-hours trading violations that resulted in Bank of America and Fleet paying a record $675 million fine. Bank of America is also being investigated for possible knowledge of financial problems at Worldcom prior to its collapse. |
| Corporate Notes | Bank of America is the second largest bank holding company in the U.S., behind Citicorp. |
| A note on sources -- Information in this deal comes from GJNY's examination of project agreements obtained through Freedom of Information Law requests, as well as news reports, minutes and notes taken at board meetings, and communication with our allies. The entries are a work in progress. For more information about the documentation behind GJNY's database, or to let us know about any developments that are not yet reflected here, please contact us at gjny@ctj.org or (212) 414-9394. | |
| Date last updated: 03/19 /04 | |