NYT: NYC Officials Defend Actions to Keep Goldman, Sachs Downtown

[DeepModem Mom]

Officials Defend Actions to Keep Goldman Sachs Downtown
By PATRICK McGEEHAN
Published: August 12, 2005


Just six months ago, Goldman Sachs, the big investment bank, appeared to be in a bind. It had committed to building its headquarters across the street from ground zero, but it did not like the city and state plans for traffic and security around the site.

So Goldman's executives did what they were trained to do: They traded their way out of a bad situation and wound up with a much more favorable one.

City and state officials said on Wednesday that they had agreed to grant the company at least $150 million in tax breaks and to provide a total of $1.6 billion in federally subsidized Liberty Bonds to revive Goldman's plan to build a $2 billion tower in Battery Park City.

Though the deal is not yet sealed, the sweetened package of incentives, served up to a company that made $4.5 billion in profit last year, appeared to defy Mayor Michael R. Bloomberg's claim to have "essentially ended corporate welfare." Some critics said they believed Goldman had simply bluffed its way into a much better hand by threatening to relocate to Midtown....

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....city and state officials, who have endured years of criticism that they have allowed downtown to languish in the wake of the 2001 terror attack, said the deal was necessary to eliminate the prospect of Goldman's moving thousands of workers to Midtown, which the firm's executives started threatening to do in the spring....By pulling out, Goldman seized the leverage in its negotiations with city and state officials. Immediately, virtually all talks with companies considering a presence at or near ground zero came to a halt, downtown officials said....


http://www.nytimes.com/2005/08/12/nyregion/12goldman.html