As Yankee Stadium, above, rushes toward completion, some politicians down in Washington are going to poke their noses into some city business relating to the supposed value of the South Bronx land.
Late last month, Richard Brodsky, a New York Assembly representative from Westchester, journeyed down to Washington to brief Dennis Kuchinich’s House Domestic Policy Subcommittee on the city’s stadium financing deals. Brodsky has contended, among other things, that the city overvalued land to get tax breaks for the ball clubs. Brodsky also charged the city with spending too much and receiving just 15 new permanent jobs in return. Neil deMause had the lowdown on Brodsky’s report.
Yesterday, Rep. Kuchinich spoke in advance of next week’s Congressional hearing on the issue. According to the Ohio Democrat, city officials could face prosecution if his committee uncovers allegations of wrongdoing. Richard Sandomir had more in yesterday’s Times:
Representative Dennis J. Kucinich, Democrat of Ohio and chairman of the House’s Domestic Policy subcommittee, wrote Tuesday in a letter to Mayor Michael R. Bloomberg that if the I.R.S.’s enforcement arm audited the sworn representations of I.D.A. [Industrial Development Agency] officials, “they could be guilty of perjury if the misrepresentations were deliberately inaccurate.”
He said the agency’s claims about the value of the stadium “cannot be relied on.”
In an e-mail interview on Thursday, Kucinich said that “our factual findings could be the basis for a later agency or court finding of legal liability.”
In the letter and interview, he cautioned that the I.R.S. could roll back the tax-exempt status of some or all of the stadium bonds. He also suggested that the I.R.S. could reject the Yankees’ pending request for tax-free status on an additional $366 million in bonds to complete the financing of the stadium, which is scheduled to open in April.
Basically, this issue come down to the valuation. The Parks Department valued the parkland at just over $20 million; the city’s Economic Development Corporation pegged it at $40 million; and the IDA issued a report alleging a value of over $200 million, well over market value for Bronx land. With this valuation in mind, the team was able to secure a whole slew of tax-exempt loans.
What this means for the team is unclear at this point. The stadium will be open in April, and someone will pay for it. It might be the team; it might be the city; it might be the taxpayers. No matter the outcome though, I doubt the Nets are going to get their new arena quite as easily as the Yanks and Mets secured the funds for their new digs.