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May 12, 2011
Nassau exec proposes $400m Islanders arena, to be paid for by (mumble-mumble, hey look over there!)
A suburban county placed under a state fiscal watchdog earlier this year will ask voters this summer to let it borrow $400 million to replace the New York Islanders' aging arena, as well as construct a minor league baseball park nearby.
If approved, the proposal to replace the Nassau Veterans Memorial Coliseum will keep the NHL team on Long Island until 2045, Nassau County Executive Edward Mangano said at a raucous news conference Wednesday. The event at the nearly 40-year-old arena featured several hundred union workers in the grandstands chanting "build it now," as well as a smattering of Islanders fans decked out in the team's blue and orange jerseys.
Mangano insisted that revenue from the Islanders and sales tax generated by the new arena would be enough to repay the $400 million in bonds over the course of a new 30-year lease for the team, although neither he nor Islanders owner Charles Wang offered specifics on the financial arrangement.
So who exactly would be paying off the bonds? As noted above, Mangano wasn't exactly saying. "Revenue from the sales tax generated by the new arena" sure sounds like a STIF, though, which is an extremely dangerous funding method given that 1) you could just end up cannibalizing existing sales tax receipts and 2) there's always the danger that if the economy slumps, sales tax receipts will go down, and then you end up having to dip into the general fund to make the bond payments. The Nassau Interim Finance Authority, which took over the county's finances in January, seems to agree, issuing a statement that it's "deeply concerned" about the arena plan and its "fiscal implications for the county."
Either way, though, it looks like this thing is going to a vote of Nassau County residents on August 1. According to New York Magazine's cite of the paywalled Newsday, "pressed for details about the revenue-sharing agreement -- and whether those figures would be available to the public before the August vote -- Mangano said, 'If it can be done, it will be.'" Now that's reassuring.