— Mike Stanton (@MikeStanton1891) July 11, 2013
Bond Buyer Publisher Mike Stanton, (@MikeStanton1891) and I were slugging it out on Twitter after I tweeted that the Yankee Stadium parking garage bonds were likely one of the most corrupt muniland deals ever.
I might have said this because the bonds had defaulted. Or because the $238 million of bonds were unrated. Or it might have had something to do with the issuer of the bonds, the Bronx Parking Development, being a couple working out of their home in Hudson, New York, who had defaulted on two previous municipal bond deals structured in the very same way. Or maybe I said this because, in the event of a default, the deal allowed the bondholders to take control of extremely valuable public land and convert it to use for private gain. This fourth explanation actually prompted my opinion of the deal.
The Independent Budget Office of the City of New York describes the parking garage deal in a blog post:
The parking system, which contains nearly 9,300 spaces, was built with substantial public subsidies, including $238 million in tax-exempt bonds and direct subsidies of $70 million from the state and $39 million from the city. Additionally, about 3 acres were removed from use as city parkland and leased by the city to the parking system. Use of the garages and lots has been well below expectation and the parking system has not generated sufficient revenue to make recent payments to bondholders.