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Does underinformed de Blasio really want MSG, Barclays Center to pay more in taxes? Who knows, but he's right that sports franchises in NYC have "gained incredible value"

De Blasio wants Madison Square Garden, other sports venues to pay more taxes, the New York Post reported yesterday, as did FoxBusiness, in De Blasio says Madison Square Garden, other NYC sports venues should pay more taxes.

However, as WBAI producer Jillian Jonas, who raised the question during the mayor's press conference yesterday, commented when she circulated the exchange via email, "Pretty certain the answer is no."

After all, the famously underinformed mayor said that, since he hadn't seen the 9/3/20 letter circulated by nine Council Members raising the issue, he was speaking "broadly," without knowledge of the legal specifics.

Still, de Blasio's surely right that sports franchises have "gained incredible value," and part of that relates to their location in the world's media capital, so there's a good case--as was made by Slate after Mikhail Prokhorov sold the Brooklyn Nets to Joe Tsai--that some of that value increase should go back to the public.

Note: the case for requiring Madison Square Garden to pay taxes is different from--and, in my mind, even clearer than--renegotiating deals for other venues that allowed them to divert payments in lieu of taxes (PILOTs) to pay off construction financing.

The exchange

Jonas's question:
Several City Council members recently sent you a letter criticizing what they called sweetheart deals the City made with assorted sports venues, noting the Garden hasn't paid property taxes since the '80s. Also, once the public has permitted back into the Barclays Center, Yankee Stadium, and CitiField, all which received funding through PILOTs – tax exempt bonds from the IDA, their payments to the City should be commensurate with the assessed property value. They asked the City to revoke MSG’s tax break, increase the amount of PILOT payments, work to keep any new stadiums from achieving those tax breaks, and pay the City an appropriate amount for renting public land in contrast to what's currently occurring. This seems like a win-win way for the City to add desperately needed revenue. Can the leases be renegotiated and what's your position on the suggestions?


The mayor's response:
I haven't seen the letter, so I'm going to speak broadly, because I haven't seen the specifics, and I don't know all the legal specifics about lease negotiation and things like that. I can say as a question of right and wrong. I think what they're saying is the right direction. Back when I was Public Advocate, I was talking about the fact that Madison Square Garden should be paying more in taxes. Let's be clear, sports franchises have gained incredible value over the years. They clearly have the resources. I think the history in this city, and pretty much all over the country, was that stadium deals were not good deals for the public by and large – some of the more recent ones have been better, but mostly they haven't been that good. And everything should be reevaluated, especially at a point where the City's going to need resources for our recovery. So, I think I it's time to look at all of that.
The Post reported a response from Council Member Costa Constantinides, who organized the letter:
“It’s great to hear the Mayor is open to having our arenas finally do their part and I hope he’ll engage with them about this."

“Yes lets pass @BrianKavanaghNY’s bill to repeal Madison Square Garden’s tax breaks and use that money to pay for schools and rent relief,” added Sen. Brad Hoylman on Twitter, as noted by the Post.

Note that his comment that "some of the more recent ones have been better" was probably triggered by his memories of the Brooklyn arena negotiations, though I'd bet he doesn't know, for example, that the state allowed refinancing to benefit the arena operator.

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