Home Ballpark Facility News New Yankee Stadium: $225 Million More in Public Subsidies

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New Yankee Stadium: $225 Million More in Public Subsidies PDF Print E-mail
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Written by Maury Brown   
Wednesday, 10 October 2007 11:06

New Yankee StadiumA stadium development project that was sold on not requiring public subsidy has turned into something far removed. That’s the story with the financing of New Yankee Stadium.

Yesterday, New York’s Industrial Development Agency approved the issuance of $225 million in tax-free bonds for new parking structures and renovation of existing parking garages around the facility. That’s a $35 million increase from what was originally proposed. The State of New York will be pitching in $70 million, with closing costs rolling in at a cool $4 million. According to Good Jobs New York, “The city estimates this will mean over $2.5 million in forgone city taxes (in addition, there will be approximately $5 million and $51 million in forgone taxes at the state and federal level, respectively).” The total cost per parking space? $800.000. How much will the public pay per spot? $25.00. How many spots will be set aside – at no cost mind you – to the Yankees? 600. According to Good Jobs New York, the development of the stadium and parking structures, involve "city, state, and federal subsidies for the project [reaching] almost $800 million in direct spending and tax breaks."

But that’s far from what is really raising eyebrows.

Wait till the “planning expenses” are displayed. The Yankees were allowed to deduct up to $5 million in “planning expenses” from their annual rent. What is a “planning expense”? As reported by the NY Times:

The impression given by this paperwork — mistakenly, the Yankees say — is that no one associated with the team ate a meal, parked a car, or drew a breath that could not be counted as part of the cost of planning the new ballpark, thus foisting it onto the taxpayers.

Included in the documents the team provided was a bill for 1,896 souvenirs for a raffle on Fan Appreciation Day in 2005 — $1 trinkets bought from a concession at the stadium. The team ran an online sweepstakes and hired a law firm to spell out the rules; the bill for the legal fees was in the planning expense box. So was the tab for thousands of dollars in baseball caps handed out to people in the luxury suites; a bill for 12 crystal baseballs that came to $1,825, including a “rush charge”; and thousands of dollars in meals billed by the Stadium Club restaurant for the clubhouse, umpires and “new business.”

Other expenses included gasoline bought by the grounds crew at the Singh Auto Mart on the Grand Concourse, the cost of shipping batting helmets to Tampa, Fla., and a cake inscribed “NY Yankees Welcomes Starwood.”

As mentioned, the Yankees said the delivered receipts are an oversight error.

“It has now been suggested that all items that were submitted were the subject of a rent credit request by the Yankees,” Alice McGillion, a spokeswoman for the team. “This is entirely, absolutely and definitively incorrect.”

What seems obvious is that a huge loophole was made available to the Yankees by way of Rudolph W. Giuliani when he was mayor (note that Rudi’s security companty was retained by the Yankees after his tenure as mayor), and then continued in practice after Mayor Bloomberg took over.


Maury Brown

Maury Brown is the founder and president of the Business of Sports Network, which includes The Biz of Baseball, The Biz of Football and The Biz of Basketball (The Biz of Hockey will be launching shortly). He is also a contributor to Baseball Prospectus contributed to the 2007 Pro Football Prospectus and is an available freelance writer.

He looks forward to your comments via email and can be contacted here

 
 
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