"The Bronx's Ransom" in the Real Estate, 4/7/6

Posted below is a very interesting item found today on The Observer's blog "The Real Estate". Click the title above to read it with hyperlinks.

The Bronx's Ransom

FILE UNDER: South Bronx, Stadiums

The Mayor has now begun calling community benefits agreements "ransom." How much was that ransom, in the case of the Yankee Stadium deal? $54.75 million.

According to a copy of the "Participation and Labor Force Mitigation and Community Benefits Program Related to the Construction of the New Yankee Stadium," helpfully provided us by the Bronx City Council delegation, this is how that breaks down, over the next 40 years:

--$32 million in donations to a trust fund, to be distributed to Bronx nonprofits;
--$5 million in free Yankees tickets, average price $25 each, for youths, schools, etc.;
--$4 million in "equipment and promotional merchandise" to youths, schools, etc.;
--$1.4 million for salary of a part-timer to assist the trust fund;
--$1.35 million for staff to monitor the minority contracting and hiring program during stadium construction;
--$1 million for job training.

There are other parts of the agreement that bear no price tag: hiring at least one-fourth of all post-construction stadium workers from the Bronx, for example, or buying from borough-based businesses whenever possible. These are, however, low-bar targets, and arguably no harder to reach than what the Yankees would have done without all the ransom talk.

No, what may be the most striking part of the deal is not how much it costs, but how little. These $54.75 million are current dollars, not adjusted for inflation, so in 2046, those charitable contributions will be worth significantly less. And a good portion of them are in-kind donations of, for example, tickets that may not have been sold otherwise. The biggest cost to the Yankees will probably not be in dollars, but rather in the aggravation of having to keep up with these benefits year after year.

-Matthew Schuerman