In April, the New York State budget approved by Governor Andrew Cuomo included a $108 million capital loan to the developers of the Kingsbridge National Ice Center (KNIC), clearing a major hurdle for the project.
But securing funding for the impending hockey center is one thing. Exploring the terms is a completely separate endeavor, and one that could take months. This delays the project even more. Completion of it could come in 2020, three years behind schedule.
And while community stakeholders and elected officials, including Mayor Bill de Blasio, prognosticate on when the project would be approved by the state, it remains unclear when the actual loan terms would be finalized. De Blasio hoped the project would receive state approval in June. Bronx Borough President Ruben Diaz Jr., a staunch supporter of the $350 million project, expected it in April. Still, the project has yet to land on the agenda of the Empire State Development corporation (ESD), the state authority under the control of Cuomo. The Board of Directors meets monthly. At its July 27 meeting, ESD did not place the KNIC project on its agenda.
ESD is the first stop. Lawyers from ESD typically work out the loan terms with lawyers representing any developer.
Advancing the project simply hinges on the back and forth negotiations between KNIC developers and ESD. Cuomo had pushed the state to earmark the loan to KNIC. Political observers noted that Cuomo’s approval of the project stems largely from his alliance to Diaz, whose ambitions to run for mayor pulled him closer to Cuomo.
In a statement, Amy Varghese, a spokesperson for ESD, said, “The State has always been committed to revitalizing the long-vacant Kingsbridge Armory, which will bring hundreds of needed jobs to the Bronx. ESD already approved $30 million for this project last year and the remaining $108 million was appropriated this year and will be released after the required public approval process.”
KNIC received the funds following a process, both closed door and public, that began in August 2015. This time, the full $108 million is sought, a move likely motivated by the city’s insistence that the full $158 million, the amount needed for the first phase of the project, be in hand before any construction can begin on the city-owned property. The Armory, found at the corner of Jerome Avenue and Kingsbridge Road, is expected to house nine Olympic-size skating rinks and a 5,000-seat arena.
Funds typically come from one or several funding streams. In the case of the $30 million loan KNIC was offered the capital loan under the Transformative Investment Program Fund (TIP). The initial loan, which represents 7.5 percent of the funds’s $400 million TIP program, was approved since the project passed a number of parameters, mainly that it could create and retain private jobs. KNIC received the $30 million loan at an interest rate of seven percent with the promise it will pay the loan back in 24 months.
Just what type of program the new loan falls under remains unclear. A representative from KNIC did not return an email seeking response.
Once ESD clears the terms, the project moves to the Public Authorities Control Board (PACB), which gives final sign-off on the funds.
Still, negotiations between ESD and KNIC represent a healthy step forward for the project that was beleaguered by years of false starts and recent litigation. The ice project was first announced by then Mayor Michael Bloomberg, favoring financier Kevin Parker’s project. NHL legend Mark Messier became the face of the project.
KNIC’s legal issues began after the city insisted on receiving the full amount for the first phase of the project in exchange for the lease release. This held up development as KNIC argued in Bronx Supreme Court that for it to receive the rest of the funds, it needed to show the state it had a lease in hand. Early this year the two sides settled their legal differences.
With legal matters resolved, and the project back in the state’s hands, community and elected leaders await with baited breath on when the state will clear the project. Once that happens, the city will continue monitoring them.
“But we are going to be very strong in making sure that the private partners do what they commit to do. We want to see it get done; we believe it can get done,” de Blasio said at a July 11 town hall in the Bronx. “So I think we’re at a point where we believe it can happen. We’re going to be all over monitoring it. Anything goes wrong we will intervene quickly. We really would like to see it get done.”