Later On

A blog written for those whose interests more or less match mine.

A Trump Tax Break To Help The Poor Went To a Rich GOP Donor’s Superyacht Marina

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The GOP is looting the US. They’re taking as much money as they can, regardless of the damage they’re doing. It’s like when the Mafia tells a restaurant owner “We’re partners now,” and starts selling off stock, cutting food quality, and in general extracting as much money as possible before the business fails as a result.

UPDATE: Matt Stoller in this column describes the Mafia Method (now the GOP Method):

There’s a scene in the classic mafia movie Goodfellas, where the mobsters pledge to protect the owner of a restaurant at which they hang out. In return for protection they get a regular payment. Whether business is good or bad, it doesn’t matter, their line to the owner is, “Fuck you, pay me.”

At first they get paid out of profits, but sometimes the restaurant doesn’t do well.

Fuck you, pay me.

Tax problems? Rent problems? Doesn’t matter.

Fuck you, pay me.

And so forth. As the owner begins bleeding cash, the mobsters begin working with the owner to liquidate what they can. They run down the restaurant’s credit by buying liquor and selling it half off. Finally they burn down the restaurant for the insurance money. This is called a ‘Bust Out,’ which is the final attempt to steal everything in sight before the game is up.

Justin Elliott, Jeff Ernsthausen, and Kyle Edwards report in ProPublica:

The Rybovich superyacht marina lies on the West Palm Beach, Florida, waterfront, a short drive north from Mar-a-Lago. Superyachts, floating mansions that can stretch more than 300 feet and cost over $100 million, are serviced at the marina, and their owners enjoy Rybovich’s luxury resort amenities. Its Instagram account offers a glimpse into the rarefied world of the global 0.1% — as one post puts it, “What’s better than owning a yacht, owning a yacht with a helicopter of course!”

Rybovich owner Wayne Huizenga Jr., son of the Waste Management and Blockbuster video billionaire Wayne Huizenga Sr., has long planned to build luxury apartment towers on the site, part of a development dubbed Marina Village.

Those planned towers, and the superyacht marina itself, are now in an area designated as an opportunity zone under President Donald Trump’s 2017 tax code overhaul, qualifying them for a tax break program that is supposed to help the poor.

Then-Florida Gov. Rick Scott bestowed the tax break on the marina after a direct appeal from Huizenga Jr., according to a 2018 letter Huizenga Jr. wrote that was obtained by ProPublica. Huizenga and his family have been major donors to Scott. Even though the opportunity zone program is supposed to subsidize only new investment, Huizenga cited the already-planned Marina Village in his appeal to Scott.

Noting the “significant private sector investment that is poised to take place,” Huizenga wrote, “This project has been planned for some time as part of the larger Marina Village initiative which incorporates the Rybovich working waterfront marina.”

The state of Florida, based on an analysis of unemployment and poverty rates, had not originally intended to pick the census tract containing the superyacht marina for the program. But those plans changed in response to Huizenga’s lobbying, according to documents from the Florida Department of Economic Opportunity obtained by ProPublica.

A little more than a week after the Huizenga letter, Scott announced his opportunity zone picks, which included the Rybovich marina area. At the same time, Scott rejected other, poorer tracts that the city of West Palm Beach had asked to be named opportunity zones.

Two other Scott donors, both billionaires, also benefit: Jorge Pérez, the Related Group chairman and CEO known as the condo king of South Florida; and Stephen Ross, a prominent Trump fundraiser, real estate magnate, and Miami Dolphins and Equinox gym part-owner. Ross’ Related Companies owns a quarter of Related Group, which is Rybovich’s partner on the planned Marina Village development.

It’s unclear how valuable the tax break could be, and the public may never know because the Trump law included no public reporting requirements. But Pérez recently boasted that the new subsidy would add jet fuel to the investment returns, telling Bloomberg this year: “It worked as a market-rate rental. Now, it works that much better as an opportunity zone.”

Huizenga and Pérez weren’t the only beneficiaries of Scott’s largesse. In a separate case in Tampa, the Florida documents show, Scott made a wealthy downtown area an opportunity zone at the request of a firm controlled by yet another billionaire donor, Tampa Bay Lightning owner Jeff Vinik. This, too, does not involve a new investment. Since as early as 2014, Vinik has been planning a massive redevelopment project in the area that will include luxury residences, hotels and shops.

Trump has hailed the opportunity zone program. Opportunity zones “are doing unbelievably well. And you’ll see that, and you’ve already seen it,” he said in August. “And the biggest beneficiary there is African Americans.”

But in Florida, the tract selections highlight one significant vulnerability in the opportunity zone process. The Trump tax law gave governors the authority to distribute valuable tax breaks, and they have wielded it to benefit the politically connected.

“That’s the real scary part of this program, that you give such incredible power to politicians to designate zones,” said Nathan Jensen, a professor at the University of Texas at Austin who studies economic development. “The fact that this process was not transparent in almost any state is shocking.”

Previous revelations about billionaires taking advantage of the opportunity zone program for already-planned developments in wealthy areas have spurred congressional scrutinySen. Ron Wyden, D-Ore., introduced a bill to overhaul the program, while Sen. Bernie Sanders, I-Vt., has called for it to be abolished.

A spokesman for Scott, who is now one of Florida’s U.S. senators, declined to comment on the superyacht marina case but said in a statement: . . .

Continue reading. There’s much more.

The US is being mugged.

Written by LeisureGuy

14 November 2019 at 9:54 am

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