Monday, January 12, 2009

"Brennan and Brodsky Convene Hearing on Yankee Stadium" Yonkers Tribune 1/9/9

(Click the title above to read the article with hyperlinks)

Brennan and Brodsky Convene Hearing on Yankee Stadium

Brodsky_AssemblymanRichard92AD Legislative Committees Seek Information from New York City, NYCIDA, and Yankees

New York, NY -- Chairman James Brennan (D-Brooklyn) of the Committee on Cities, and Chairman Richard Brodsky (D-Westchester) of the Corporations, Authorities and Commissions Committee today announced that their respective committees would convene a hearing next week to inquire into circumstances surrounding the provision of close to $2 billion in taxpayer money for construction of the new Yankee Stadium with particular focus on the City's attempt to add over $400 million in such assistance next week. The hearing is being called next Wednesday, January 14 in the face of the refusal by New York City to postpone a final decision until a full understanding of the law and the facts could be brought forward.

"The City's attempt to ram through this complicated project without disclosure of its implications is not acceptable as the Legislature considers what changes in State law it ought to be making," said Assemblyman Brodsky. "The hearing will provide info necessary for the Legislative process."

"I'm concerned about the consequences of diverting property tax revenue to repay these bonds for such a lengthy period of time for the benefit of a wealthy company," Mr. Brennan said.

Witnesses invited include:

Randy Levine President, New York Yankees ( Download Randy Levine )
Harold Steinbrenner Owner, New York Yankees ( Download Harold Steinbrenner )
Seth Pinsky President, New York City Economic Development Corporation ( Download Seth Pinsky )
Derek Park, Vice-Chairman of the New York City Industrial Development Agency ( Download Seth Pinsky )
Martha Stark, Finance Commissioner, New York City ( Download Martha Stark )
Maurice Kellman, Property Assistant Commissioner, Finance Department, City of New York ( Download Maurice Kellman )
Background Info:
In 2006 the New York Yankees were given about $1.5 billion in $1.5 billion in tax benefits and public funds for the building of a new Yankee Stadium. Over $500 million was direct cash and tax relief. The additional $950 million came in the form of low-interest bonds whose principal and interest were repaid with tax dollars, as the City freely admitted in sworn filings with the IRS: “The City has determined to use its property taxes (in this case PILOTs) to finance the construction and operation…of the Stadium.”
The Yankees are now seeking, with the support of the Bloomberg Administration, an additional $430.9 million. The largest single use of the money seems to be for a new television, video-audio system at the Stadium. Other notable uses include monies to replace concrete ramps with granite ones, to cover legal and financial fees, and to pay for a museum and conference center, Yankee administrative offices, concessions, and suite upgrades.
It should be noted that $123 million of the actual cash proceeds of the bonds will be paid directly to the Yankees as repayment for money they have already "advanced" to the project, apparently always anticipating the additional taxpayer monies would eventually be received.[1]
The City calculates a net economic benefit of $59.7 million.[2] They do this by ignoring the cost to taxpayers of repaying the bonds. If these costs were included as they properly should be, the actual economic cost to the City of these additional bonds alone, would be about a minus $500 million.
The process being used by the City is limited to a single public hearing now scheduled for January 15, and a final vote now scheduled for 9 a.m. the following morning. Documents and information needed to analyze and understand this proposal have been withheld from the public and the Committee.

[1] Core Application, “Additional Bonds (PILOT and Rental) Sources and Uses Table,” footnote 1.

[2] NYCIDA Project Cost/Benefit Analysis, page 2.

SOURCE: Corporatons, Authorities and Commissions Committee


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