NYC considering granting MSG endless permit in exchange for new escalators

The New York City Planning Commission is set to vote tomorrow on a proposal to extend the permit that allows Madison Square Garden to sit on top of Penn Station. (It’s not technically a lease, but rather an operating permit — trust me, neither you nor I wants to spend the time this morning to understand it.) And while the previous plan to extend the permit indefinitely seems to have been warded off by opposition from several major city planning groups, those same groups are now claiming that the new plan would represent a “a gift to Madison Square Garden”:

The city will in fact propose a 15-year renewal, rather than a 50-year one, which is in theory a victory for the planners. But the proposal also contains a major loophole: if the Garden meets certain conditions during those 15 years, it can get a permit to remain on top of Penn Station in perpetuity.

Namely, the Garden would have to come to some sort of an agreement with the three railroads that run beneath it to make improvements to the station, like adding new escalators and elevators. If such an agreement were to reached, and the City Planning Commission’s chair (who is appointed by the mayor) were to approve it, then the Garden could remain where it is, on top of the ever-more-crowded Penn Station. Its special permit, in other words, would have no expiration date.

Whether you think this is a good idea or a terrible one probably depends on your ultimate goals: If, like the Regional Plan Association and Municipal Art Society, you want to get the home of the Knicks and Rangers out of the way (to some undisclosed new location) so you can build a new, grander Penn Station (with some undisclosed source of money), then this is terrible, since it means the Garden can stay put just by buying some improvements for the underground train station. If, on the other hand, you just want MSG to have to pay for its right to use city land instead of getting to remain there for free, then this is potentially an okay deal — depending on what “improvements to the station” mean, obviously, and how this multipartite deal between MSG, Amtrak, and the commuter rail lines would actually be negotiated.

(Or, if you’re the head of the city’s business lobbying group, you think it’s a terrible idea because MSG just spent $1 billion on renovations, and if they don’t get an endless permit to remain in place they’ll … unspend the money or something?)

Meanwhile, a far more constructive bit of government action would be if the state legislature would actually revoke the Garden’s endless property tax break, which is now a public gift of $15 million a year and climbing. Or, hell, even demand that MSG build some escalators if it wants to keep it. Don’t hold your breath, though, given that 1) the New York state legislature never actually does anything if it can help it, and 2) MSG has hired Gov. Cuomo’s former director of cabinet affairs, just in case.

Campaign mounts to move MSG (somewhere), build new Penn Station (somehow, with some money)

The notion of tearing down Madison Square Garden right after it got $1 billion in renovations and building a new one in an unknown location just so Penn Station can have some skylights if anyone comes up with money for it may be, on the surface, a little nuts, but it’s sure getting lots of high-profile supporters. Manhattan Borough President Scott Stringer and the local community board have both endorsed terminating MSG’s use permit to the city property where it stands. The New York Times editorial page, as noted earlier, has also jumped on the bandwagon. And yesterday, the heads of the Municipal Art Society and the Regional Plan Association, the two civic groups behind the proposal, took to the Daily News op-ed pageto tout the idea, saying that limiting MSG’s permit renewal to ten years “would provide the time, attention and focus required to find a new and strategic site for the Garden, allowing the city to have both a splendid modern arena and a great train station.”

On the one hand, there’s nothing actually wrong with keeping the permit renewal to ten years: If MSG’s owners can be talked into building elsewhere by then, fine, and if not, the city can always just give them another renewal in 2023. But while the MAS and RPA no doubt see themselves as righting a historic wrong — the demolition of this to make way for the current MSG — and more space for a nicer train station is no doubt a good idea, has anybody actually stopped to think about how much it would cost to clear space for an arena (which would need to be near a transit hub as the current MSG is, and so on expensive land), build it, and then build a new Penn Station on the current site? There’s something to be said for already existing infrastructure: It may be imperfect, but at least it’s already paid for.

The hope here is that the ten-year permit renewal is being pursued mostly as a negotiating ploy: We don’t know what the city may want to do in the future, or what MSG may want to do, but let’s at least limit the length of the permit so the city can keep its options open. The fear is that this will end up a self-justifying project, where the city ends up having to spend millions (or billions) of dollars to “help MSG relocate” just so that commuters can have a nicer place to get off their trains in the morning. We already narrowly dodged that bullet once, but bad projects never seem to die.

NY legislators propose axing MSG’s eternal property-tax break

Fans of boneheaded legislative actions will recall that way back in 1982, New York Mayor Ed Koch agreed to give the owners of Madison Square Garden (and also the Knicks and Rangers) a 10-year property tax break to help pay for some renovations to the building, in exchange for the teams promising not to leave town. Except that somewhere in the course of writing the bill, the state legislature forgot to put in an end date for the tax break, meaning the Garden is continuing to rack up property-tax subsidies, to the tune of $15 million a year at last count.

Now, finally, somebody in Albany is actually trying to do something to reverse this 31-year-old action. Assemblymembers David Weprin and James Sanders have introduced a bill to strip MSG of its tax break, with Weprin arguing that “that money could be very well used by the city in tough economic times on things like education, police.”

MSG is also engaged in a bitter battle with one of its unions, which could have something to do with why Weprin and Sanders chose this moment to suggest repeal of the tax break (though they insist otherwise, but then, they would). Regardless, it’s nice to see state legislators actually realizing that it’s possible to undo tax breaks that they handed out decades ago — though not in all cases, obviously, because that’d be crazy talk.

NYT to MSG: Get lost, we wanna rebuild our underground train station

This is really weird: The New York Times has an editorial today calling for New York City to refuse to renew Madison Square Garden’s lease zoning permit on the land atop Penn Station, which apparently expired in January. The argument: MSG is “bulky” and “drumlike” and is in the way of a grand renovation of Penn Station that nobody really wants to spend the money on anymore, but anyway, “The Garden has moved twice since its original location in Madison Square. It can move again.”

The Times does note in passing that MSG’s owners just spent about $1 billion on renovating the arena, and that “of course makes them less eager to move” — and then suggests that they instead be given a new 10-year lease, buy lorazepam overnight “and use the time to find a new home for the Garden.” Because it totally makes sense to tear down a building that just got $1 billion in upgrades so you can tear down something else and spend another $1 billion on a new one.

This smells like the Times is carrying water for someone, but I’ll be damned if I can figure out who. Old-time rail terminal fans who are holding out hope for the Moynihan Station plan? Developers hoping to revive some plan to do a giant development project on the site? And in any case, if you want the city to lean on MSG over something, why no mention of that perpetual property tax exemption they’re still getting? Very, very weird…

MSG renovations on for 2011, sending Liberty into three-year exile

The on-again, off-again renovations to Madison Square Garden are back on again, slated to begin next summer and be completed by Fall 2013, a full year later than at last report. By limiting work to the summer, MSG will be able to avoid disruptions to the New York Knicks and Rangers schedules, but as I wrote on the Village Voice website yesterday, the New York Liberty WNBA franchise won’t be so lucky:

This won’t be the first time that the Liberty will be forced to relocate: The orange-teal-and-black were displaced to Radio City Music Hall for part of their 2004 season so that George W. Bush could be re-coronated on their home court. But there’s a big difference between shifting a few home games 20 blocks north and completely pulling up shop for three seasons…

As for future summers, it’s as yet unclear where Maddie will be parking her doghouse. Newark’s Prudential Center, as the Times suggested, is the most accessible big arena to city Liberty fans, and would if nothing else lead to a rise in the average Kinsey number among PATH ridership. (It could also make for a nice low-cost option for hoops fans in one of the tristate area’s most impoverished cities; Liberty games at the Garden are already distinct from Knicks games for drawing a large number of African-American teens of all genders.) And with MSG renovations slated to last through 2013, there’s even the possibility of a one-season stay in Brooklyn, given that Bruce Ratner’s Atlantic Yards is still — officially, at least supposed to be complete by late 2012. Liberty officials didn’t immediately return calls seeking more info on the team’s plans.

The renovation itself, which will essentially end up gutting the Garden and building a new seating bowl inside the existing shell, are now estimated to cost between $775 million and $850 million, all of which will be paid for by MSG’s corporate owners. MSG’s corporate owners who already get an $11 million a year tax break from the city of New York, mind you, but it’s still a pleasant change to see a sports team not asking for new subsidies on top of the ones they’ve already received.

MSG reno pushed back to 2012

Cablevision rebooted its $500 million renovation plans for Madison Square Garden today, saying they’ll now be completed by summer 2012, instead of summer 2011 as was announced last year. Of course, given that the renovations were originally supposed to start this summer and the New York Liberty have their season opener at MSG this Sunday, this shouldn’t come as any surprise; in fact, given that the MSG reno needs to happen entirely during the summers to avoid inconveniencing the Knicks and Rangers, 2012 might be ambitious as well. If and when it happens, the reno job would add floor-level suites (suiteholders would have to emerge into regular seats to actually see the game) and expanded concessions areas, accomplished by both moving current team offices to adjacent buildings and moving the upper part of the seating bowl forward.

Still no details, meanwhile, about how the renovation would be financed, though MSG exec Hank Ratner promised it would involve no public money, quipping, “We all know how anomalous that is today.” Except, presumably, for the tax break that won’t die.

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.)