New York Rangers to play home game as road team to protect $50m-a-year tax dodge

In what I suppose is a tax dodge but is actually kind of hilarious, the New York Rangers are going to be playing a game in New York City as the road team against the Buffalo Sabres, all because they don’t want to spoil the eternal property tax break they were accidentally gifted 35 years ago:

When the Buffalo Sabres and New York Rangers square off in the 2018 NHL Winter Classic in Queens, the Sabres will be the home team despite being headquartered 385 miles away…

Madison Square Garden, the privately owned Manhattan home of the Rangers and the NBA’s New York Knicks, would risk a lucrative property-tax exemption worth more than $40 million a year if either team plays home games in New York City outside the iconic arena…

“If one or both of said teams shall cease to play their home games in said property at any time, the tax exemption provided herein shall cease immediately and such property shall immediately be restored to the tax rolls,” New York’s Real Property Tax Law states.

You can see why the state legislature wrote the language that way back in 1982: They didn’t want to give the Knicks and Rangers a massive tax break and then have the teams leave town anyway, as they were at the time threatening to do without the subsidy. (Though the bill’s crafters also either neglected to notice or intentionally snuck in language that made the tax break extend indefinitely, something that’s now cost the city government more than $400 million.) But apparently they didn’t notice the loophole of the teams playing home games and calling them road games — it’s not like the NBA or NHL would really abet the teams’ tax dodge by designated all of their games as road games, I don’t think, but…

Anyway, all of this subterfuge, and the now $50 million annual cost of the tax break, could be avoided if the state legislature would just pass a bill to rescind it after 35 years. (Mayor Ed Koch claimed he thought he was approving just a 10-year tax break at the time.) Such a bill is annually introduced to the state assembly by Manhattan assemblymember Brian Kavanagh, and for the fifth year in a row is sitting in committee with no action. With government watchdogs like these, NHL-abetted loopholes are all MSG’s owners need to keep raking in the dough.

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10 comments on “New York Rangers to play home game as road team to protect $50m-a-year tax dodge

  1. In case you weren’t aware, Neil, this isn’t the first time this has happened either. In January of 2014, they played both the New Jersey Devils and the New York Islanders at Yankee Stadium three days apart, and they were the road team for both those as well.

    Karma not always being a thing, apparently, they won both games.

    1. Yes, that’s noted in the article I linked to above. At least the Islanders and Devils have better claim to being a home team in the Bronx than Buffalo does in Queens, though.

  2. Didn’t the Rangers play “home” games in Europe during the MSG renovation? Or were those preseason games, and thus not relevant…

    1. The rule apparently applies to the five boroughs only. The way it sounds, the Rangers or Knicks could play home games in Europe, Yonkers or MetLife Stadium, but not anywhere else in NYC other than MSG.

  3. Nice!Makes you think the next time something like this is written there will be verbage closing this loophole.

  4. IIRC, the league compensates Buffalo for a sellout home game and the league keeps the receipts, right?

    1. That is my understanding of it Ty. The league essentially buys out the home team for that one game. I don’t know if it’s fair to say the league keeps the receipts (some goes into revenue sharing or other forms of distribution) as all teams share in the bounty to one degree or another.

  5. To the best of your knowledge Neil, has the authority ever challenged how and by whom the “home game” designation is made?

    Is it clearly defined anywhere how a “home” game is determined?

    It would have been reasonable to include language that states that any game played within the boundaries of the five boroughs is a home game regardless of the designation made by the league, or to require a minimum of 40 regular season home games be played at MSG to maintain the exemption (one off games like outdoor events can be accommodated by mutual agreement… and would have been an opportunity for leverage for the authority as well).

    Or perhaps this is just an early example of what happens when you let your negotiating opponent write the lease?

    1. If it were written to say any game played within the five boroughs as a home game, every time the Knicks played the Nets and when the Rangers played the Islanders in Brooklyn would be a violation.

      The clause ties the teams to MSG in perpetuity as the cost benefits to stay are great. It explains why they went ahead with the multi- million dollar rebuilding of MSG and never considered building something new.

      Proponents of a new Penn Station on those grounds were stymied by the team’s tax clause.

  6. This is totally extra legal, but I would really love to see a governor come along and do some massive property tax reform. Simply tell all the places getting TIFs/non-profit exemptions (cough colleges)/these types of special exemptions/churches/et cetera…

    that the police and fire are not longer going to service their buildings unless they start paying property taxes. And that as such without police/fire coverage they are unsafe and must shut down. My city has huge problems with a bunch of super high quality land being given over to mostly empty churches, combined with a bunch of private colleges owning huge tracts of land including commercial districts they pay no tax on. You can always pick these out because they often have businesses that would not normally survive.

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