Wednesday, October 10, 2007

"For Yankees, the Numbers Game Goes On" NY Times 10/10/7

For Yankees, the Numbers Game Goes On

Published: October 10, 2007
Baseball has ended in New York for this autumn, but the game continues. Yesterday morning, it was parking spaces: One of the invisible arms of city government agreed that 3,600 parking spots would be built in the Bronx for the new Yankee Stadium at a cost of about $80,000 per spot. Of these, 600 will be turned over to the Yankees for the team’s exclusive — and free — use. The general public will pay up to $25. The mind reels.

During Rudolph W. Giuliani’s last days in office, he said the team could deduct $5 million a year in “planning expenses” for the new ballpark from the rent it pays to the city for the old stadium. This arrangement was continued by Mr. Giuliani’s successor, Michael R. Bloomberg.

It is now Year 7 of the planning era, which runs through 2008.

And what is a planning expense? This summer, when asked by the city to document those costs, the team delivered a box of receipts, according to Warner Johnston, a spokesman for the city Parks Department, landlord of the current Yankee Stadium.

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.”

And then there was the serious money: hundreds of thousands the team paid to lobbyists and law firms as part of its planning costs.

These receipts, and others, were obtained under the Freedom of Information Law by Good Jobs New York, a labor-funded group that is critical of city subsidies for the new stadium. The Yankees, for their part, say the documents have been misunderstood: the team was not actually charging the city for all these costs, just a fraction of them.

“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.”

The team will submit additional documentation “to avoid existing and future confusion,” Ms. McGillion said.

Mr. Johnston of the Parks Department said, “The Yankees will be working to identify which receipts are intended to be used for the planning credit.”

Even so, this is a moment in which the trivial is a reliable window onto the larger shape of things. The gasoline bills and grilled salmon meals will surely disappear from the $40 million provided by the public to help the Yankees, an immensely profitable private enterprise, plan a new, smaller ballpark with even more expensive tickets.

What will remain in the planning costs are the fees paid to politically connected lobbyists, bond lawyers and other advisers. (The Yankees retained Mr. Giuliani’s security firm to advise it on protecting the team and the old stadium.)

There is more to come, even in the side dishes like parking garages. The city’s Industrial Development Agency yesterday approved the issuance of $225 million in tax-free bonds for new parking platforms near the stadium and to renovate old garages. The state is giving $70 million. Just the closing costs on the bonds come to $14 million.

The city is supposed to receive $3.2 million in annual rent, if there is enough cash left after the bonds have been repaid. But other money vanishes: the city, state and federal governments will lose $58.3 million because the parking bonds are exempt from income tax, said Bettina Damiani, director of Good Jobs New York. She estimated the total subsidies for the new stadium at $795 million. Even if she’s batting .500, it’s clear this is a game worth playing year-round.


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