Bloomberg orders budget cuts after Wall Street losses
Mayor Michael Bloomberg said last month that the city’s budget would have to be cut in some areas to compensate for lost revenue from the collapse of AIG, the Lehman Brothers bankruptcy filing and the ongoing turmoil on Wall Street. Bloomberg ordered such city agencies as the Police Department and the Department of Education to cut spending by a total of $500 million this year and $1 billion in 2009, the New York Times reported. The fallout on Wall Street is expected to drive up the city’s office vacancy rate, lower asking rents and result in more job cuts.
Report says Yankee Stadium deal unfair to taxpayers
The new Yankee Stadium received up to $850 million in taxpayer investments, but will create only 15 permanent jobs, according to Assemblyman Richard Brodsky’s recently released 30-page report, “House That You Built.” The report said the city’s Industrial Development Agency may have violated the law by creating massive amounts of public debt and failing to assure public benefits from the investment. The Yankees got $336 million from the city and state and up to $500 million in interest savings on IRS-approved tax-exempt bonds, the New York Daily News reported.
Brooklyn mortgage firm owner admits to stealing $44M from Fannie Mae
A former owner of a Brooklyn mortgage firm admitted to stealing $44 million from Fannie Mae between 1994 and 2004, the New York Post reported. Leib Pinter, 64, pleaded guilty to conspiracy to commit wire fraud and will face a 10-year sentence when he returns to Brooklyn federal court later this year. Pinter was the owner of Olympia Mortgage Corp. and admitted to pocketing the proceeds from 257 mortgages that his company serviced for Fannie Mae.
State may have known of shady past for Deutsche Bank demo company
State development officials may have known about the John Galt Corporation’s shady past when it hired Galt to tear down the Deutsche Bank building in 2006. The building was, of course, the site of a blaze that killed two firefighters. Some of Galt’s top executives had worked for another company, called the Safeway Environmental Corporation, which had a history of problems with the city’s Department of Investigation, including integrity, competence and financial issues. City investigators accused development officials of knowing about Galt’s questionable ties before hiring the company to demolish the Deutsche Bank building, the Times reported.
Contractors at crane accident get fines
The Occupational Safety and Health Administration, a federal agency, fined three contractors a total of $313,500 for violations at the site of the 19-story tower crane collapse at 303 East 51st Street in May that killed seven people, the Post reported. The charges include failure to properly train employees about job-site hazards, failure to provide protection to stop workers from falling and failure to comply with the crane manufacturer’s specifications when erecting the crane.
Rangel speaks on missed taxes
In explanation of his failure to pay taxes on the rental income of a resort villa in the Dominican Republic, U.S. Representative Charles Rangel said cultural and linguistic barriers made it difficult for him to ascertain the financial details from resort managers. Rangel said he would repay several thousand dollars he owes for his failure to report the $75,000 rental income, the Times reported. Rangel, who is chairman of the tax-writing House Ways and Means Committee, also came under scrutiny for allegedly lobbying the Internal Revenue Service on behalf of the New York Yankees for tax breaks that would save the team up to $66 million on the construction of its new stadium, according to the Daily News.
Compiled by Linden Lim