President Hillary nixes Pardon for Sanders/The Burlington College Thing

by Carola Von Hoffmannstahl-Solomonoff

Babyface Bernie

Now that Hillary has schlonged him by hook and crook, Bernie needs to fear for his future. Sure, Hillary will be forced to do a reach-out. Bernie will get the star treatment at the Dem Convention. Progressive promises will be made. The party platform will be symbolically tweaked. Little Debbie may even go down. But if Hillary is elected president, vengeance will be hers.

Bill Clinton has already said Bernie’s supporters will be “toast” come election day. Can Bernie’s burn be far behind? The strength of Bernie’s challenge has been a humiliation for Hillary. And she doesn’t do forgive and forget. Not for Hill that Godfather distinction between personal and business. Political opponents aren’t reps of valid difference; they’re agents of the perpetually churning vast conspiracy (launched by the right, swollen by the left) out to get the Clintons.

First, they came for Bill.

Then they came for Hill.

Trying to cheat her of the throne she’s earned by being married to him.

O to be a fly in the mind of potential President Hillary as she plots Senator Sanders’ future

“I’ll show that socialist nobody. How dare he manspread all over MY party. I’ll put his office in the Senate basement bathroom. Committees? Don’t make me laugh. (Cackle cackle.) Funding? That– and a nickel! As for those ‘rumors’ of a federal investigation into the Burlington College thing– lawyer up, Bernie and Jane! I’ll be hands-on at the Justice Department.”

The Burlington College Thing

Burlington is Vermont’s biggest city (pop 42,452) and the home turf of Bernie and Jane Sanders. From 2004 till 2011, Jane was president of Burlington College, a private, non-profit liberal arts college. Burlington College was very small and very progressive. Official slogan: “Start a fire”. (Presumably a socially transformative one, not just a wienie roaster.) The college closed this May after staggering along financially for years. The killing burden was a $10 million mortgage loan engineered by Jane Sanders in 2010. Jane’s goal was to expand Burlington College via relocation to a more impressive setting. At the time, the college was operating out of a former supermarket which served a surrounding blue collar neighborhood.

Until a few decades ago, Burlington was primarily a working and middle class town with naturally occurring affordable housing. Though there were certainly social divisions, it was a pretty laid back place. Teens called it “Borington”. Thanks to progressive planning by local pols (including former Mayor Bernie Sanders) and assorted public and private real estate players, Burlington has been transformed into a hip happening city blessed with stacks of cookie cutter condos attractive to wealthy folks with a taste for views of Lake Champlain. Not that affordable housing doesn’t exist– subsidized digs are available for the qualified. Social divisions? Considerably more pronounced.

Jane Sanders’ aim was to move Burlington College out of the supermarket and into a former Catholic orphanage set on thirty-some wooded acres overlooking Lake Champlain. The lake front land was traditionally treated as public parkland by locals. In its day, the orphanage had a sinister reputation; the building eventually transitioned into headquarters for the Burlington Catholic Diocese. It was/is a mound of Victorian stone. A big place for a student body of roughly 200 (130 full time) but Jane reasoned that if you buy it, they will come. And while the acreage was extensive much of the building was unusable due to disrepair, keeping the actual learning space cozy.

Jane arranged for the college to purchase the building and surrounding acreage from the Burlington Catholic Diocese. They were eager to sell. Their coffers had been depleted by $17 million in settlements paid to litigants claiming diocese leaders covered up for predatory priests.

The deal Jane Sanders engineered was a private/public combo platter. The Vermont Educational and Health Buildings Finance Agency issued $6.5 million in tax free revenue bonds. People’s United Bank bought the bonds; Vermont College was on the hook to People’s for principle and interest. Also in play– a $3.5 million loan from the Catholic Diocese (guess those litigants didn’t totally strip the coffers) and a “bridge loan” of $500,000 from local developer Tony Pomerleau, a vintage Sanders supporter.

Long story short: Burlington College wasn’t able to meet its obligations and this spring, People’s United Bank lowered the boom.

Attempts had been made to save the college. But fund raising efforts were inconsistent and the results disappointing. Student body growth never met projected numbers. In 2011, Jane Sanders was ousted/retired as president– with a $200,000 parachute. The next president was the college’s former chief financial officer and a friend-of-Jane. She quit a few years later after receiving a no-confidence vote from students, faculty and staff. Eventually, the acres of lake front land surrounding the college were sold to a developer. (More condos coming soon, affordable slots included!) The money from the sale was helpful but insufficient. And the college’s accreditation was set to be canceled, due to its long running financial woes.

The announcement that Burlington College was closing was made the day after this year’s graduation ceremonies. No warning was given, students and faculty were left scrambling. Many are still twisting in the wind over things such as financial arrangements, transcripts, and pension plans.

Whether recent rumors of a federal investigation played a part in the suddenness of the endgame are unknown.

The issue said to be of federal interest? Jane Sanders allegedly misrepresented the college’s assets and projected income to the tune of $2 million when engineering her purchase deal. (Among other things, a future death bequest was painted as money in hand.) And as we all know post housing-bubble collapse, fudging assets and income to obtain mortgage loans qualifies as bank fraud, a federal crime.

Of course, in her eagerness to “start a fire” Jane may have just made mistakes. Ones the college board of directors didn’t spot. And Jane still has the support of the Burlington Catholic Diocese; its leaders say proceeds from the sale of the college property (the college building was recently purchased by the same developer who bought the surrounding land) covered what they were owed. However, some parishioners are not so sanguine and want legal action.

Meanwhile, the last few Republican Party animals in Vermont have been writing letters to Washington, requesting a federal investigation. Their most recent missive even targeted Bernie; claiming they have credible info that Senator Sanders improperly pressed People’s United Bank to do Jane’s deal. Bernie’s spokespeople characterize the charges as political lies.

In normal times, I’d say Bernie and Jane have nothing to worry about. Questionable real estate deals involving politicians on their home turf are a dime a gazillion. Intent to defraud is hard to prove. And as we all know post housing-bubble collapse, mortgage shenanigans are rarely prosecuted. But these aren’t normal times. Hillary could become president. And with her, any stick will do to beat an enemy.

I like Bernie– even if he did help turn Burlington into one more Bobo Paradise. I admire his grit. His run has been inspirational in many ways. I voted for him in the New York State Democratic primary.

For his sake– and Jane’s– I’m praying Trump wins in November.

 

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Parker’s Chill, Cuomo’s Crony Capitalism Fever

by Carola Von Hoffmannstahl-Solomonoff

While down with the flu in January, I read a lot of Richard Stark. Aka Donald Westlake. A pile of volumes from Stark/Westlake’s Parker series towered on my nightstand. The adventures and misadventures of Parker, an ultra cold hearted professional thief, were the perfect antidote to fever.

The late Donald Westlake grew up in Albany, New York. When interviewed in 1995, Westlake sounded sardonic and oblique about his youth in the capital city. And while a number of books in the Parker series take place in upstate New York, Albany is never a central location*. Characters pass through it or around it. Usually in a stolen car.

In Backflash (Mysterious Press, 1998) Albany as the seat of state government is central to the plot, yet few scenes are set in the city. A complex heist and series of murders are put in motion by Hilliard Cathman, a retired fiscal planner for the state. Cathman whiles away his retiree time as a public policy consultant with a low rent office near the “huge dark stone pile of the statehouse”. He is, as Parker puts it, one of the “camp followers of state government”.

Due to his opposition to legalized gambling, Cathman is an unsuccessful camp follower. His potential clients in legislative places are eager to tap into a major new source of revenue; Cathman won’t give them his consultant stamp of approval. His objections to gambling are arguable but reasonable. But as Parker suspects, Cathman’s ego investment in being proven right has become unbalanced.

To prove his premise that gambling draws crime, Cathman recruits Parker to rob a riverboat casino that’s being allowed to ply the Hudson between Albany and Poughkeepsie as a limited-time experiment. The casino’s political backers hope the experiment proves so successful as to open the door to gambling statewide. As a fiscal planner for the state, Cathman was privy to inside info about the casino’s security arrangements, etc. He feeds the info to Parker and his crew. They successfully pull the heist.

As usual in a Parker book, there are numerous slips twixt cup and lip. Most caused by the greed and stupidity of pilot fish swarming the haul. But the wildest card in the set-up is Cathman. In a final confrontation in Cathman’s home in Delmar (an Albany suburb popular with state employees) Parker discovers just how far round the bend Cathman has gone– and that he has a self-aggrandizing plan which if allowed to play out will doom Parker.

How many times do regular citizens make the same discovery about policy planners? Parker is Everyman!

Speaking of planners with killer bees in their bonnets…

New York State Governor Andrew Cuomo is big on forging more public-private partnerships as engines of state economic development. He said so in his Executive Budget speech on January 17th. (While sick I read non-fiction fiction as well as the real stuff.)

Yes indeed. More crony capitalism will cure New York’s economic ills. And Anna Nicole Smith needed bigger breast implants.

New York is crony capitalism central. The quadruple D example? The public-private partnership of Wall Street and Washington that pumped the housing bubble and sank the economy beneath a mountain of dodgy mortgage-backed investment paper. As assistant secretary and then secretary of HUD from 1993 to 2001, Andrew Cuomo helped steer housing policy when the bubble started swelling and the paper flying. Cuomo’s HUD policies included pushing “a reform that allowed Fannie (Mae) and Freddie (Mac) to receive affordable-housing credit for buying private subprime mortgage-backed securities”**.

HUD was also the parent organization of OFHEO (Office of Federal Housing Enterprise Oversight), the agency then charged with oversight of Fannie Mae and Freddie Mac. OFHEO, under Cuomo and other HUD heads, resisted efforts to change Fannie and Freddie’s murky and ultimately disastrous public-private status.

By the time the bubble popped, Andrew Cuomo was New York State Attorney General. In 2007, Attorney General Cuomo announced that in light of the pop, he was launching an investigation into “industry-wide mortgage fraud”. Fannie Mae and Freddie Mac were prime targets. In a letter to Freddie Mac Cuomo implied that Fan and Fred had colluded with lenders to profit from mortgages based on inflated appraisals. In a matter of months, Cuomo’s investigation dissolved into a payout of $24 million from Fannie and Freddie. No admittance of wrongdoing required. The fraud problem was found to lay mainly with– and could be corrected at– the appraisal level.

Fannie and Freddie’s payout went to establishing the Independent Valuations Protection Institute. The institute, with board members approved by Andrew Cuomo, would monitor lenders for compliance with a new Home Valuation Code of Conduct (HVCC) authored by Cuomo. Though merely a state attorney general, Cuomo’s national clout re appraisal policy was enhanced by support for the code from OFHEO, the agency overseeing Fannie and Freddie.

In the bubble years many appraisers complained about being pressured by lenders to inflate values. Yet equally large numbers hate the reform Cuomo engineered. Some claim he had a conflict of interest when establishing HVCC.

Starting in 2004 and until becoming NY attorney general, Cuomo was chairman of the board of advisors at Appraisal Management Company (AMCO) a Cleveland-based private “independent valuations solutions company” doing business with national lenders. AMCO, a subsidiary of Worldwide Outsource Solutions Ltd., had a board full of HUD; including former HUD secretary Jack Kemp (under Bush 1) and assistant secretary William Apgar (under Clinton). Edward J. Davidson (Ed Davidson), CEO and board chairman of AMCO and Worldwide Outsource, has been a consultant for Fannie Mae.

In October, 2004, Cuomo, Kemp and Apgar told reporters at the Mortgage Bankers Association annual convention that “the integrity of the appraisal process has broken down”. American Banker described the presentation as “part admonishment of lenders, part sales pitch for a vendor”.***

In March, 2005, Cuomo, Davidson, Kemp and Apgar, in a letter on AMCO stationary, pressed OFHEO’s drirector, Armando Falcon, to have a “totally independent source” review the loans within Fannie and Freddie’s “securities field”.

In February 2006, AMCO issued a press release applauding board member Andrew Cuomo’s support for the newly formed non-profit Appraisal Advocacy Coalition. According to Inman News (a real estate publication), the coalition’s missions included protecting appraisers from “unfair competition“.

Maybe HVCC was a much needed reform. Note “was”. The Dodd-Frank Wall Street Reform and Consumer Protection Act is slated to end HVCC. (Then again, it may just be whittled down. Appraisers fear that the reports of HVCC’s death are greatly exaggerated.)

Discerning the true motives of public-private players can be tough. When on the public side, they so often launch investigations and reforms that obfuscate obfuscate obfuscate. I say keep the public public and the private private. It makes the game easier to call.

When Governor Andrew Cuomo touts public-private partnerships as the path to NY economic development, a sizable majority of New Yorkers get starry eyed. Not I.  It took more than the housing bubble and its bad paper and players to make me an unbeliever. Viewing New York’s public-private deal maker, the Empire State Development Corporation (ESDC or ESD), in action has also been instructive…

See corruption and wishful thinking meet and marry! See billions in public money tossed at elephantine projects that come to naught! See ginormous tax breaks produce handfuls of jobs in depressed regions! And oh yeah– see small property owners get dispossessed at the behest of powerful developers. Rampent eminent domain abuse being one of the rottenest of New York’s public-private fruits.

Next up in the fruit bowl: Governor Cuomo’s plan for a massive Las Vegas style casino in New York City. Most likely at the Aqueduct Racetrack in Queens. The casino would be built by the Genting Group of Malaysia. (They already run slots at Aqueduct.) To enhance the project, the state would erect “the largest convention center in the nation”  nearby. And get this; the casino could put all of New York State on “an inside track to expanded gambling”.

I just hope nobody tries to chill the project with a Parker.

As for Cuomo, his crony capitalism fever keeps rising. In late January, corporate campaign donors with their eyes on infrastructure prizes paid $50,000 each to sit next to Cuomo on a panel at a national Democratic Governors Association conference. The confab, which was held in Manhattan, was hosted by Governor Cuomo. No press or public allowed.

Sometimes it pays to go private.

 

* “I’ll leave Albany to Bill Kennedy. He’s found a lot more there to write about than I did.”  Mystery Man award-winning novelist Donald Westlake remembers his Albany haunts, Paul Grondahl, Albany Times Union, 10/21/95

** Cuomo’s HUD career under scrutiny, Buffalo News, 08/21/10

***Fears about Appraisals, and Other MBA Buzz, Jody Shenn, American Banker, 10/27/04

 

 

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Left, Right, Third Party in Sight?

by Carola Von Hoffmannstahl-Solomonoff

Remember the late great Tea Party? The grass roots movement that made the political establishment quake? For one glorious moment it seemed as if a truly independent, average Joe/Joan movement might be gathering steam. A memory from that halcyon time: assorted TV pundits telling Republican leaders that Tea Party people “don’t like you guys either”. To which said leaders would put on a humble face and mumble something about how Republicans had lost their way and needed to get back on track. The big spending, corruption, and support for endless wars were missteps off the path of Republican core values.

In truth, no missteps were made. The Republican core was intact. Albeit shared with the Democrats. Big spending, corruption, and endless wars R both parties.

Though the following factoid has disappeared into the memory hole of ideological rewrites, a goodly number of those initially drawn to the Tea Party did not support endless wars. They supported the troops ’cause that’s a question of loyalty. But adventures-in-nation-building weren’t their thing. They were also concerned about losing civil liberties via Homeland Security overkill. And most Tea Party protesters blamed Wall Street, as much as government, for the financial meltdown of 2008. Lest we forget, the Tea Party really took off when the too-big-to-fail banks and other financial entities that partied with housing bubble paper were bailed out by taxpayers.

For a brief period the left was equally vociferous re the bailouts. But the moment of rapprochement between progressives and Tea Party types, along with the potential for game-changing coalitions, passed when it dawned on the left that coming down too hard on taxpayer infusions and massive government interventions might not set the right tone for passing health care reform. The Tea Party was way suspicious of government (almost as much as the 60’s counter-culture had been) and it was the wrong time to fan such suspicion. Instead ’twas time to ridicule and revile the masses of average Americans who feared that a government redo would make the failings of U.S. health care worse instead of better. That this fear might be based on, say, observation of the role federal policies played in inflating and eventually collapsing the housing market buttered no progressive parsnips. As for the fear that Obamacare would be Homeland Security in a nurse’s uniform, how paranoid was that?

While the left was in the basement mixing up the medicine and the Tea Party was on the pavement thinking about the government, the Republicans seized the time. Coming back strong as champions of the people and enemy of the political elite. (Insert row of laughing emoticons here.) Hoovering up the Tea Party and making it their own. The more the left trashed “tea baggers” the more the independent spark in the Tea Party dimmed. Tea talk started sounding more and more like the type of Republican conservatism dished by Limbaugh & company. Critiques of state capitalism, particularly as practiced during the Bush years, were out. So were thoughts of a third party. Union bashing was in. With public employee unions cast as evil incarnate.

After several years of government hearings and investigations into the 2008 financial meltdown, Republicans and Democrats have been unable to reach agreement on who-done-it. Republicans put the blame on the government sponsored mortgage giants, Fannie Mae and Freddie Mac; Democrats pin it on an insufficiently regulated Wall Street. No prime movers of subprime sleaze (hello Angelo Mozilo), or political enablers (hello Friends of Angelo), or major Wall Street sludge jugglers (too many for a shout out) have been prosecuted. Nor have new lending regulations staunched the growth of mortgage fraud in taxpayer-backed housing programs. However, we will be able to hang some teachers out to dry.

The concordance of big government and big finance that pumped the housing bubble and hence inflated hauls of real estate derived taxes (including property taxes) was not why so many local governments overextended themselves during the boom years and now face disaster during the bust. The real villains were teachers, firefighters, police officers, sanitation workers, and secretaries in public agencies. Aka Joe and Joan Average with a government job. Who, according to the bashers, are not average at all ’cause they get better benefits and more job security than a private sector employee or a small business owner. That being a private sector employee or a small business owner has its own set of advantages butters no conservative parsnips. The right, which typically decries attempts to stir up class warfare, is passing out flaming torches and whipping up envy. Screaming for folks to be stripped (preferably in public?) of their collective bargaining rights. Working to turn the American middle-class against itself.

And I thought only lefties were into creating social chaos…

Incidentally (or not) while the billionaire Koch brothers donated $43,000 to the gubernatorial campaign of union-busting Wisconsin Governor Scott Walker, housing and Realtor groups kicked in $43,125. Not that Republicans in general are uniquely blessed by the real estate industries. In New York, another state with budget problems, the NYC real estate crowd has been particularly generous to Governor Andrew Cuomo.

As for Joe and Joan Average, who really represents them? The left or the right? Answer: neither. At least, not reliably. Under certain self-serving circumstances both do an occasional good deed. But when push comes to shove in our state capitalist times, Joe and Joan are on their own. Which is less discouraging than it sounds. Being independent means never having to say you’re sorry for noticing that your representatives, no matter how rhetorically righteous, primarily rep big money conjoined with government power.

Third party, anyone?

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Mortgage Fraud! Mollusks! Taxpayers Rush to Invest

by Carola Von Hoffmannstahl-Solomonoff

Ah, mortgage fraud. The unsung power tool of the housing bubble. Starting around 1999, the FBI issued repeated warnings that mortgage fraud was surging. Few in government listened. Fraudsters ranged from organized cross-country rings of real estate, banking, and investment professionals, to non-profit profiteers and Joe and Joan Doakes lying on mortgage aps ’cause they just had to have that house. Feeling nostalgic about the big grift that sent no major players to jail but left taxpayers holding the Hefty and the landscape blotted with foreclosures? No need. Boom or bust, the impetus for mortgage fraud is a constant. When housing is hot there’s pressure to keep the market booming, in bust mode there’s pressure to jack it back up.

According to Core Logic (a leading provider of business information), after taking a breather in 2009 mortgage fraud increased more than 20% in 2010. (The Mortgage Asset Research Institute reports that Florida and New York lead the nation at number one and two respectively.) With government now owning or insuring 97% of mortgage bonds via Fannie Mae, Freddie Mac, and the Federal Housing Administration (FHA), taxpayers are on the hook more than ever. And they’re paying for new twists. Quoting* mortgage fraud attorney L. T. Lafferty, a former federal prosecutor specializing in white collar crime, “fraud is… perpetrated differently when there are different opportunities”.

When one door closes, another opens…

Loan origination fraud, a mortgage fraud staple, is seeing new emphasis on hiding debt and liabilities. (Prior mortgage defaults? No problem.) Due to increased requirements for proof of income, credit, etc., mortgage fraud rings increasingly rely on identity theft rather than fake documents– thereby involving a wider circle of victims. Then there are the homebuilders with a glut of houses or condos who offer buyers financial incentives that aren’t disclosed to lenders. After buyers obtain loans, builders welch on the incentives. Oops, more underwater mortgages. Faked occupancy is on the rise. (Loans for second homes, and for rental properties without an owner in residence require larger down-payments and higher interest rates.) And hey– foreclosure rescue scams are on fire! Loan modification, refinancing, short sales, real estate owned (REO) sales, and government sponsored programs are being mined big time. Of course, almost the entire housing market might now be called a government sponsored program…

To date, taxpayers have kicked in $153 billion just to prop up Fannie Mae and Freddie Mac. Fan and Fred’s oversight agency (an organ of the FHA) estimates that the agencies’ losses through 2013 will require another infusion of between $68 billion to $210 billion. In government speak, a massive transfer of wealth from the general public (roughly one third of whom are renters) to cover a mountain of bad private assets is called an “investment”.

In Washington, the Obama administration and Congress are trying to hammer out a plan for “weaning the $11 trillion mortgage market from its dependence on government”**. The weaning, which will allegedly include the waning of Fannie Mae and Freddie Mac, must be done carefully and slowly so as not to damage the fragile housing market. (When the market was robust, reform was rejected ’cause it might damage the boom.) A time frame of five to sevens years has been mentioned. By then the full wean will be in the hands of the next administration. In the meantime, the real estate lobby is beating down doors in DC, to make sure that nothing (untoward) is accomplished. The National Association of Realtors, the American Bankers Association, the National Association of Home Builders, the National Council of State Housing Agencies, and the National Fair Housing Alliance are united by their determination to protect folks from being cheated out of the American Dream of Home Ownership.

Do Mollusks Dream of Electric Drills?

Mortgage fraud isn’t the only real estate product backed by taxpayer investment. There’s always (forever and ever) urban revitalization. Point of info: investment in urban revitalization does not put the truly needy in safe, clean public housing and bring industry back to fading blue collar cities. Instead it pumps luxury condo enclaves, twee art and restaurant districts, and political corruption. Perhaps no place exemplifies this type of urban revitalization better than Hoboken, New Jersey. A small (one mile square) waterfront town across the Hudson River from Manhattan, which after biting post-industrial dust was reborn as the jewel of government-backed new urbanism. That almost all of Hoboken’s blue collar residents were pushed out of town in favor of wealthier professionals largely employed by Wall Street mattered not. Gazillion urban planners saw the future and it was Hoboken.

What they didn’t see were the mollusks. More about them in a minute. First, the corruption. Everyone saw the corruption. Over the roughly three decades in which Hoboken became the revitalized gem of Jersey’s “Gold Coast”, developers and public officials from Hoboken and its parent entity Hudson County, went down like nine pins; bowled over by federal and state investigations frequently targeting corruption related to government-backed development projects. The U.S. Department of Housing and Urban Development (HUD) and U.S. Department of Transportation were soaked again and again. As were assorted state agencies. Tax breaks were/are crony candy. Hudson County’s other cities revitalized their historic corruption with equal fervor, inspired by Hoboken’s new urban success.

Hoboken eventually became one of the most valuable chunks of real estate in the country. Yet taxpayers have never stopped investing in its revitalization. The promenade that stretches along the city’s condo-lined waterfront was a mega investment. The walkway and its park areas are open to the public. Hoboken’s master builders would have preferred waterfront access to be restricted to condo dwellers but local green space activists fought not only to keep it open, but to expand the walkway into an unbroken strip running along the entire Gold Coast. Since public largess was powering waterfront development, developers had to bend. Pols scrambled to speed their plow, cutting government red tape re construction. In Hoboken the promenade was largely in place by the 1990’s. New Jersey’s Department of Environmental Protection signed off on it every step of the way.

Now we get to the mollusks.

The first cave-in on Hoboken’s promenade occurred in 2007, at Castle Point Park in mid Hoboken. Just a small collapse. No cause for alarm. But two years later, part of a sports field that had been built atop a pier slid into the Hudson. When the field was developed in the 90’s engineers warned that the pier’s pilings were infested with shipworms, a type of mollusk. Shipworms eat wood. Suggestions were made that the pilings be replaced with something less tasty. The suggestion went into the memory hole.

In early 2010, a section of the walkway in the north, near a cove between Hoboken and Weehawken collapsed. Last October, a fifty foot sinkhole opened on Frank Sinatra Drive. (Sinatra was a Hoboken boy.) The drive, which is 13 years old, runs along the river in front of a strip of luxury condo towers– including one which houses former NJ governor and ex Goldman Sachs boss Jon Corzine. The sinkhole, which was also allegedly caused by mollusks, followed two smaller collapses on Sinatra. Recently, engineers determined that the steel beams supporting Pier A, a popular park on the south end of the promenade near Hoboken’s train and ferry stations, need a makeover. Seems the concrete jackets on the beams aren’t covering all they should. No danger from salt water corrosion yet. Just being proactive. Pier A is like, totally safe.

Despite all the wealth that hangs in Hoboken, the city has severe financial problems. Hoboken isn’t the only entity responsible for repairing the collapsing waterfront (as example, Sinatra Drive was a county project) but the city will have to cover much of the rehab. The cost will be more than the entire city budget. Massive debt will be assumed via bonding. According to the New York Times***, Mayor Dawn Zimmer (elected in 2009) is holding out “hope for state and federal aid”. And Hudson County is hoping to obtain federal grants to repair the Sinatra sinkhole. As for the mollusks, they have high hopes for more wood.

*Mortgage Fraud: Worse Before Better, Expect More Schemes and More Regulatory Oversight in 2011, Tracy Kitten, Managing Editor, Bank Info Security, 02/04/11

**Obama Administration Calls for Winding Down Fannie, Freddie, Lorraine Woellert and Rebecca Christie, Bloomberg News, 02/11/11

***As Hoboken’s Riverfront Crumbles, the Cost for Repairs Soars, Richard Perez-Pena, New York Times, 02/08/11

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