May 26, 2004
Reading the fine print
A Newsday article on how Suffolk County is making out on a publicly funded baseball stadium for the minor-league Long Island Ducks is an excellent lesson in why you can't analyze a stadium deal until you know the terms of the lease.
Citibank Park was built in 2000 for $19 million, $14 million of which came from the state, $5 million from the county. The team has been wildly successful, turning a $7 million profit in its first two years of operation. But because the county, which owns the park, gets no share of merchandise and concessions sales, its take was just $1.4 million over those two years - barely enough to cover debt service on its $5 million in bonds.
The state, meanwhile, which paid for almost three-quarters of the park, is completely hosed, since a team on the eastern part of Long Island is unlikely to draw any fans from out-of-state who'd increase state sales tax revenues.
Ducks owner Frank Boulton, who's also commissioner of the Atlantic League in which they play, brushed off criticism that he should have been more generous in his lease terms, snapping: "I'm not going to apologize for doing a good job and being successful." Boulton also noted that the league's Atlantic City franchise, which he also owns - this is a man with no shortage of hats - by comparison pays only $125,000 a year in rent. The article didn't say, but presumably he didn't apologize for that, either.
