NYC council: Enough with the MSG tax break already

It’s spring, and the New York City council’s thoughts turn to the property tax exemption enjoyed by Madison Square Garden, owner of the Knicks, Rangers, and Liberty, which now costs the city a whopping $14 million a year. Councilmember Eric Gioia became the latest city official to demand the tax break’s repeal over the weekend, calling it “questionable at any time – and unjustifiable in these difficult economic times,” and saying of the Garden owners, “Frankly, if I were them, I’d be embarrassed in accepting it or requesting it.”

The MSG tax exemption has a long and weird history. Way back in 1982, then-mayor Ed Koch proposed letting the arena’s owners out of paying property taxes to fund Garden renovations, in exchange for the teams staying put in town. Koch said at the time (as has since reiterated) that he thought the tax break would expire after 10 years; when the legislation was actually written, however, it read that the exemption would continue in perpetuity until such time as “one or both of said teams
shall cease to play their home games in said property.” (There was some talk during the 2004-05 hockey lockout that the Rangers had violated this clause, but no one tried seriously to enforce it.) The total city cost of the tax break over time is now approaching $300 million.

Mayor Mike Bloomberg has long been a critic of the tax exemption, dating back to when Cablevision, which owns MSG, successfully fought off the mayor’s plans for a new Jets stadium nearby. The council jumped in as opponents last year, ultimately voting to repeal the tax break – but the state legislature, which actually has say over the provision, wouldn’t play along. (State assembly leader Sheldon Silver, you may recall, was one of Cablevision’s main allies in the Jets stadium battle.)

So for now, expect the stalemate to continue. Which means the issue will continue to be ripe for press conferences by city officials, especially those running for higher office – Gioia, you’ll note, is in the race to become the city’s next public advocate. (Yes, that’s an actual elected position in New York. It’s complicated.)

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One comment on “NYC council: Enough with the MSG tax break already

  1. From Yahoo sports

    Darren Rovell, Sport Biz: “[Stephon] Marbury was scheduled to earn $20.8 million from the Knicks…Assuming an average per capita income of $39,000 here in the United States and a $17.8 million [contract buyout] settlement, Marbury earned what an average American earns for the year in less than 6 1/2 hours [to NOT play].”

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