Thursday, December 18, 2008

"E-mails reveal how city went to bat for Yankee to inflate value of stadium land" NY Daily News 12/16/8

E-mails reveal how city went to bat for Yankee to inflate value of stadium land
Tuesday, December 16th 2008, 10:50 PM

Mayor Bloomberg's aides secretly pressured city tax assessors to inflate the value of land under the new Yankee Stadium so the team could qualify for nearly $1 billion in tax-free bonds, city e-mails show.

In March 2006, the city's chief tax assessor put the market value for the stadium site at $27 million, far lower than the Yankees wanted. A Finance Department official ordered him to redo the report. Within hours, he jacked up it up to $204 million.

The bombshell e-mails raise a big question: Did city officials violate state law, which requires uniform valuation methods for all properties?

"This is the smoking gun," said Assemblyman Richard Brodsky, who has spearheaded a state probe into the stadium deal. "The professionals did their job. The political appointees then ordered them to change the assessment - and they did."

Bloomberg aides have told a state Assembly committee and a House of Representatives subcommittee they did nothing improper.

"There was no pressure on us," Finance Commissioner Martha Stark told the congressional subcommittee in October. "In no way did it [the assessment of the stadium] lead to our assessors doing anything out of the ordinary."

The e-mails tell a different story.

They show that top aides in City Hall, the Law Department and the city Economic Development Corp. were obsessed with getting a high assessment for the new stadium site to please the Yankees.

The city was forced to turn those e-mails over to the congressional and state committees. The Daily News obtained copies.
On Dec. 22, 2005, Michael Kalt, an aide to former Deputy Mayor Dan Doctoroff, wrote EDC officials, "I don't want to get into this much further on e-mail, but we have to take into consideration that the AV [assessed value] is only so high because we're choosing a methodology to support the tax-exempt financing."

Kalt was City Hall's point man for the Yankees project. He knew the Yankees needed a high assessment because the team was planning to pay back $940 million in tax-exempt financing with something called PILOTs - payments in lieu of taxes. The higher the assessment, the more tax-free bonds the team could ask the IRS to approve.

Kalt, now a vice president of the Tampa Bay Rays, declined to comment Tuesday. "No one influenced the assessment," Bloomberg spokesman Andrew Brent said.

Stark has told Congress that her staff did not know how the payments are calculated.

The e-mails show that City Attorney Joseph Gunn notified Stark's former assistant commissioner, Dara Ottley-Brown, on July 15, 2005, that "the Yankees have an interest in seeing that the assessed valuation will be high enough to generate as much PILOT for tax-exempt debt as is lawful and appropriate."

They also show Stark's staff met at least three times with the Yankees and other city officials to discuss the department's assessment method.

On March 21, 2006, a few weeks before City Council's vote on the Yankees project, Maurice Kellman, the city's chief assessor, sent Ottley-Brown the stadium assessment report. It estimated the value of the land under the stadium at $26.8 million.
Finance Department spokesman Sam Miller said Tuesday that a "senior assessment team" decided Kellman's estimate was too low compared with the construction cost of the new stadium.

After a series of frantic phone calls and e-mails on March 21 and 22 between a half-dozen city officials and the Yankees, Ottley-Brown ordered Kellman to produce a new report.

"Here is the writeup with the changes you requested earlier today," Kellman wrote on the 22nd, pumping the assessment up to $204 million. Kellman would not comment.

There are still hundreds of e-mails connected to the stadium assessment the city refuses to release.

That's why it's time for some prosecutor to step in, subpoena every document and figure out if the Bloomberg administration manipulated land assessments for the Yankees.


Post a Comment

<< Home