Queens MLS stadium could require more than $100 million in tax breaks

MLS has begun presenting its $300 million stadium plans to Queens neighborhoods, which apparently involves drawing a little yellow circle on a map and motioning to it with a laser pointer. It also held the first of several planned town hall meetings on the topic, if by a “town hall” you mean a meeting where supporters pack the room, opponents have to watch on a video feed, and all questions must be submitted in writing and the organizers decide which ones to answer.

Meanwhile, some details continue to trickle out about the stadium financing plan, which according to Crain’s would include “a 35-year, $1-a-year lease, with no sales taxes on construction materials, no property taxes and no revenue sharing with the city.” That’s clearly a subsidy — given that forgone property and construction sales taxes on the nearby Mets stadium, which cost about double to build, amounted to $272 million, this could easily amount to $100 million worth of public subsidies. And that’s before we know anything about how the actual lease will break down, what if anything MLS will pay to use public land for replacement parks, whether the city will still get a cut of Citi Field parking revenue when it’s used for MLS games, etc.

At least MLS officials are now backing away from their “at the finish line” talk of last month, with league president Mark Abbott telling Capital New York that “we have a lot left to do.” Not to say I told you so, but…

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12 comments on “Queens MLS stadium could require more than $100 million in tax breaks

  1. Not much different than the “…vote for he bill and THEN you’ll find out what’s in it…” mentality, MLS plays any you pay.

  2. A city only giving out tax breaks to get a new stadium is like getting raped by someone wearing a condom. It’s still bad but it’s usually much worse.

  3. Neil;

    Can you expand on the “Citifield cost $272m in construction sales tax breaks” line?

    If I remember correctly, the stadium cost around $800m (which is, like, a total bargain! see Yankee Stadium Mk II, errr, III). I would have though the absolute maximum construction and materials tax waivers could have saved would be $100m give or take, together with maybe $5-7m in property tax during 3yrs of construction. What am I missing (other than $172m)?

    Property taxes during construction tend to be relatively low (compared to the value of the finished product), and since sports facilities tend to be valued at 10-15% of their construction cost for taxation purposes… I’m struggling to find the missing tax break.

  4. Almost all of it is foregone property taxes, and it’s spelled out in the spreadsheet linked above. (Click on “$272 million.”) Figures are from the New York City Independent Budget Office.

  5. Nothing wrong with giving tax breaks on a parcel of land that isn’t getting taxed right now anyways.

  6. I tried that at dinner last night — “That plate of pad see ew wouldn’t be earning you anything if I didn’t eat it, so why can’t I have it for free?” — but the waiter just looked at me funny.

  7. If you’re eating there and cause others to come to the restaurant to eat as well, people who wouldn’t normally be there, then yeah, it’s a win/win.

  8. People are going to be paying extra property taxes in Queens because there’s a soccer stadium there? Sorry, this latest extension of the metaphor lost me.

  9. That’s a great idea Bob! The land my house sits on not only wouldn’t be earning the town I live in any money if it wasn’t there, it would costing the town money.

    So not only should I be exempt from property taxes, the town should pay me a modest amount in lieu of what they would be paying to secure and maintain the vacant property, to kill weeds, and to cut the grass.

  10. aha! Thanks Neil, I didn’t see the “blue” $272m…

    So the savings indicated isn’t part of the construction cost so much as it is from the ‘lifecycle’ cost of the facility… I assume it’s a 30-35yr property tax benefit you base this on?

    Maybe I just read the original article incorrectly, but it sounded like ‘savings on construction’ only, which appears not to be the case.

  11. Well, given that MLS likely will bond out the construction and pay it back over time, they can use the tax break to help pay off the construction debt. But yeah, it’s not money going directly towards construction, more of a back-end subsidy.

    And I *think* IBO based its calculations on a 30-year exemption, but I’d have to dig up the original reports to check.

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