Perspective
Aug. 10, 2011
The wages of subsidy: Searching for value in public-private development deals
It's not always clear whether the developer is truly receiving a subsidy or paying what the land is worth. By Jon E. Goetz of Kronick Moskovitz Tiedemann & Girard
Developers who acquire land from public agencies at discounted prices or rents are often surprised to learn that their land acquisition may trigger prevailing wages, pay rates roughly equivalent to union scale wages and benefits, often significantly higher than non-union wage rates. Having to pay prevailing wages is regarded as a trade-off for the receipt of a public subsidy for a development project.
Public agencies commonly sell and l...
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