Wednesday, July 04, 2012

Times Sports section agrees Barclays Center naming rights worth $200 million, suggests sum "hard for any team to turn down" (but why were naming rights given away, or not calculated as subsidy?)

So, the New York Times has agreed that the Barclays Center naming rights deal is worth $200 million, thus performing "rowback," which former Times Public Editor Daniel Okrent described in his 3/14/04 column as "a way that a newspaper can cover its butt without admitting it was ever exposed."

Remember, the New York Times Metro section, 7/19/11:
The new design from SHoP Architects and Ellerbe Becket for the arena, the Barclays Center, which the British bank will pay nearly $400 million to name...
My exchange with the Public Editor (actually his assistant), who resisted any correction to the more accurate figure of $200 million-plus, posted 8/3/11.

Sports Business Journal's confirmation that the naming rights deal has been renegotiated to $200 million, posted 9/19/11.

New York Times Sports section today, 7/4/12:
The $200 million that Barclays is paying over 20 years for the arena’s naming rights would have been hard for any team to turn down.
Who had them to sell?

Actually, the Nets didn't have naming rights to sell. That went to arena developer Forest City Ratner, at that point majority owner of the team.

But why should Forest City have had the naming rights in the first place? It's a publicly owned arena, albeit one rented to the developer for a buck, part of a fig leaf to get tax-exempt bonds issued, which are then repaid via PILOTs (payments in lieu of taxes).

Why should cities and states give away naming rights, in whole or in part? When asked in 2009, Steve Matlin, then an attorney for the Empire State Development Corporation, stated, “It’s part of the financing for the project."

While it certainly has been relied on by Forest City Ratner, it was never cited as part of the sources and uses for the project. Nor was it even counted as a subsidy in any cost-benefit analysis regarding the project, not even the one by the New York City Independent Budget Office.

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