Today’s news:

Astoria power plant proposal hits roadblock

Bar Chairman Philip Weinberg sent a letter to Gov. George Pataki and Mayor Michael Bloomberg on April 23, questioning the legality of funding the plant with $400 million in Liberty Bonds, the tax-free loans intended to revitalized lower Manhattan after the terror attacks.

The bar now joins five New York legislators who filed suit in April opposing the decision by the Liberty Development Corporation, which administers the bonds, to give preliminary authorization to issue them to Astoria Energy LLC.

One of the legislators, City Councilman Peter Vallone (D-Astoria) said the bar's support lends credibility to the suit, especially since the development corporation dismissed it in an official statement as "frivolous" and "without merit."

State Assemblyman Michael Gianaris (D-Astoria), U.S. Reps. Carolyn Maloney (D-Astoria) and Jerrold Nadler (D-Manhattan), and City Councilman Alan Gerson (D-Manhattan), are the other co-plaintiffs in the suit filed in federal court in Manhattan.

Weinberg and the legislators argue the future 1,000-megawatt plant on Steinway Street does not meet the criteria for projects that qualify for liberty bonds.

Liberty bonds were created in March 2002 after Congress authorized the governor and mayor to issue $8 billion in tax-free, private activity bonds for residential and commercial construction projects that would benefit Lower Manhattan, which was designated the "Liberty Zone."

Up to $2 billion of the fund may be used for projects outside the zone on projects that create at least 100,000 square feet of usable office or commercial space, or "non-residential real property.

Weinberg's eight-page letter notes that the Astoria plant's 347,500 square feet will be comprised of just 18,000 feet of office space.

The bar "takes no position regarding the appropriateness of this facility," the letter states. "However, a review of the federal legislation governing the Liberty Bonds indicates that the use of the bond program to assist with the financing of this plant is unlawful."

Astoria Energy announced last month it had secured $983 million in private funding for the first phase of its 1,000-megawatt generator. A spokesman said the company plans to go ahead with its construction project despite the litigation and might seek alternate funds should it lose the liberty bonds.

Reach reporter Matthew Monks by e-mail at or call 718-229-0300, Ext. 156.

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