Yankees’ terrible “community benefits fund” is even more terrible than you imagined

After the New York Yankees and Bronx elected officials set up a charitable organization in 2006 to assuage fears that the team’s new taxpayer-subsidized stadium would be bad for the local community, the charity came under fire for being used as a slush fund by its Yankees-appointed administrator and for handing out lots of money to dubious nonprofit groups that may not actually have been nonprofit. The New York Times completed an in-depth investigation into the New Yankee Stadium Community Benefits Fund yesterday, and it turns out everything is on the up and up — ha ha, no, of course not, it’s an even worse train wreck than was suspected previously:

An examination of the fund’s public financial records and interviews with community members and a former administrator of the fund show that it has operated with little oversight or public accountability, neglecting those who live near the stadium and instead sending money to other, often wealthier parts of the Bronx that were not affected by the construction.

The fund also regularly donates to organizations with which it shares common board members. And although the Yankees provide $35,000 a year to cover operating expenses, the fund in 2011 began to allocate 10 percent of the grants it awards to cover its own “additional administrative costs.” Those costs have never been publicly explained…

Of the $6.8 million distributed by the fund between 2008 and 2015, the last year for which records are available, only 30 percent — $2 million — went to charities occupying the same ZIP code as Yankee Stadium or four bordering ZIP codes.

The best way to get money from the Yankees’ community fund, it appears, was not to be in the Yankee Stadium neighborhood that had just lost its central park space for multiple years to make way for construction of the team’s new stadium, but rather to have friends on the charity’s board: the New York Botanical Garden, which has fund chair Serafin Mariel (the same guy who was sued in 2009 over misappropriation of funds) on its board, got $20,000, and the Bronx CUNY Scholarship Fund which Mariel co-founded, got $60,000. And the organization’s annual reports have never been publicly released, going only to the Yankees, who won’t share them. Oh, and the Yankees claim 15,000 tickets a year as an “in-kind donation,” but don’t say who they’re given to.

All this leads up to the best quote in the whole article, and really one of the best quotes in any article:

[Former city councilmember Maria del Carmen] Arroyo [who helped set up the fund with then-borough president Adolfo Carrion] said she did not remember how the board was selected. When asked about some of the board members’ political ties, she said: “This is a small city. You can’t go very far without knowing anyone.”

So who’s to blame for this? The Yankees owners, for setting up a Potemkin charity just so that the city council could claim that the stadium would be good for the South Bronx before voting for it almost unanimously? Or the Bronx pols who turn every policy decision into a way to funnel money to their political donors? That’d both, I’d say, since one hand nicely washed the other here. It’s yet another reminder of the dangers of community benefits agreements — and that if you must do a CBA, for god’s sake, at least have the city government be a signatory to it, so that there’s some opportunity for oversight. Because letting a sports team owner claim credit for doing good works on the grounds of “don’t worry, I’m good for it” is a recipe for disaster.


6 comments on “Yankees’ terrible “community benefits fund” is even more terrible than you imagined

  1. I’m not totally clear how you square the statements that, on one hand, Bronx politicians want toys to play with to help their political friends and the idea that a CBA would work better with city oversight. Where would these people come from?

    In reality, the best CBA is probably one that identifies costs and payments up front as part of the deal: real land appraisals, requiring purchase and transfer of replacement park land as an integral part of the deal, agreements to mitigate traffic and parking, etc.

    If the deal isn’t a good one, then we as a polity should say so. A palm-greasing legal bribe to look the other way doesn’t make a bad deal good–as you point out.

    • With city oversight, the records would be public and FOILable, so journalists could get their hands on them and expose them in public. This was a pretty crappy payoff by the Yankees to begin with, but not even being able to tell how much they’re paying and to whom makes it even worse.

  2. Shhh!

    Don’t let any of this information reach the ears of the new Coyotes owner, Andrew Barroway, as he might use this scheme to somehow get someone else to pay for his new arena.

    • Andrew Barroway owns a factory that turns out ideas for getting someone else to pay for his new arena. He got it in a leveraged buyout, of course.

  3. The only way that quote could be better is if it were made in reference to one of the four (?) metropolis’ on the planet that are actually bigger than the one it was made about. Who votes for these people?

    Having the city or, in this case, district residents directly appoint/elect members to this “CBA” board/panel would be a good start.

    Tammany Hall is still with us in so many ways…

  4. To put in perspective how much (or little) money to the Yankees that the $6.8 million distributed by the fund between 2008 and 2015 is, consider that the Yankees are paying Alex Rodriguez $21 million not to play this year.

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