June 13, 2008

More details on Yanks' latest money grab

As the furor over the New York Yankees' demand for $350-400 million (no one seems to agree on the exact number) in new tax-exempt stadium bonds spreads throughout the local news media - where were these people when the Yanks got their first $940 million in bonds, I ask you? - more details are beginning to emerge. Let's get right to them:

• New York City Independent Budget Office deputy director George Sweeting has supplied a breakdown of just how much $350 million in tax-exempt bonds would cost various levels of government: New York City, $3.6 million; New York state, $6.7 million; federal government, $72.6 million. The Yankees' savings, meanwhile, would be only $61.9 million - presumably the bondholders would be collecting the remaining slice of the action.
• Janel Patterson, a spokesperson for the city Economic Development Corporation, has confirmed that the IRS rule the city is looking to have waived for the Yankees is the one instituted last year (though apparently not yet officially finalized) that requires that (finance jargon alert!) payment in lieu of taxes being used to make bond payments constitute a set percentage of the property taxes they're supposedly in lieu of. (As noted previously here, bond buyers don't like that.) The Yankees could still presumably use tax-exempt bonds if the IRS says no, but the benefit wouldn't be as great.
• While I was at it, I asked Patterson to provide an updated breakdown of the cost of replacing parkland and building infrastructure for the Yanks project. Her reply: The total city cost is now projected at $280.8 million (down slightly from $282 million in March); of that, $177 million would go to replacement parkland (down from $190 million), $34.5 million to infrastructure/street work (up from $25-30 million), $38.96 million towards a new Metro-North commuter rail station (down from $39.6 million), and $30.4 million to "soft costs" that can't be assigned to one category or another (up from $22 million).
• All of the above is now reflected in the updated New York stadium cost spreadsheet.

In other news, several state legislators are up in arms over the latest Yankees proposal, U.S. Rep. Dennis Kucinich is demanding more information from the IRS as to why it approved the initial Yanks and Mets bonds, and state assemblymember Richard Brodsky says he'll hold hearings on the matter in "a couple of weeks" - hoo, baby!