Saturday, June 14, 2008

"High End or Low, Ballparks Break Bank" NY Times 6/14/8

High End or Low, Ballparks Break Bank

Published: June 14, 2008

An interesting problem is what to do with the words and numbers “$2 billion.” Hardly anyone really knows what they mean. One example, worth repeating, is that the difference between a million and a billion seconds is the difference between 11 days and 33 years. A thousand seconds is 16 minutes.

This week, word came that the Yankees want $250 million to $350 million more in tax-free bonds to complete construction of what is the most expensive stadium ever built in the country. With $943 million already in its bucket, the team is scratching around for additional public financing to bring the Yankees’ part of the project to about $1.2 billion.

Add to that at least $500 million that the city is paying to build garages and to replace parkland, a figure that is likely to climb. By the time kids are at last playing in the new parks that will replace the ones handed over to the professional sports team, no one would be surprised if the whole stadium package came to $2 billion.

Such a number has no connection to ordinary life. It might help to scale things down.

The Yankees and the Mets are at one end of the professional sports world, in Major League Baseball. At the other end would be Class A short-season teams, which play 38 home games a year. Each team may field no more than 3 players who are older than 23. About 10 years ago, New York City built two ballparks for Class A short-season teams, one in Coney Island, Brooklyn, for an affiliate of the Mets, the other near the ferry terminal in Staten Island for a team half-owned by the Yankees.

Counting the improvements made to the streets around the stadium, the Staten Island ballpark cost about $76 million, the most expensive minor league baseball stadium ever built. It was 8 or 9 times the cost of the average minor league stadium built for 10 years before it, and was more than twice as much as the next costliest.

Both minor league parks are beautifully situated: In Staten Island, the stands overlook New York Harbor, and in Coney Island, the stadium is alongside the ocean.

Charming as they are, the two stadiums together cost about $120 million. Both teams have long-term leases with the city and are supposed to pay rent based on attendance. But the rent has rarely amounted to more than a few hundred thousand dollars a year.

Sometime in the next few years, New York City will have completed two new major league stadiums, with the Mets building a new park in Flushing, Queens. In the span of a decade, the city will have spent well over $2 billion to subsidize professional sports teams.

The stadiums began as a cause championed by Mayor Rudolph W. Giuliani. His successor, Michael R. Bloomberg, professing great skepticism about the public financing of sports arenas, walked away from deals that Mr. Giuliani made in the last hours of his administration. Now, however, Mr. Bloomberg — a man with firsthand experience of what a billion dollars means — has proven to be every bit as generous as his predecessor.

That still leaves the problem of scale.

So one more example.

To build the stadiums in Brooklyn and Staten Island for 12 weeks a year of minor league baseball, the city borrowed the $120 million over three decades. The debt service on those loans costs the city $6 million annually, or $500,000 for every week of play.

And what does $6 million a year mean?

That is about $2 million more than the city pays for sports equipment and uniforms for 400,000 public high school students. And that means $10 a kid.



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