Category: New York Red Bulls

The New York Red Bulls (aka Red Bull New York, aka whatever they’ll be called if Red Bull sells them) are still appealing that tax court ruling from almost three years ago that they have to pay property taxes on their arena in Harrison, N.J. The tax court ruled then (and an appellate court agreed) that because the team collects all the revenue from the arena, it’s effectively a private stadium regardless of who holds title to the building; in its appeal to the state supreme court, Red Bull’s response has been that that’s not fair, because nobody told them the rules ahead of time:

Red Bull Arena “was undoubtedly the victim of a ‘bait and switch’ in this case, as its promised tax exemption vanished into thin air,” says the Red Bulls’ successful petition for certification.

Red Bull should be aware that tax rules can change, right? Oh, sorry, wrong crappy food product ad campaign.

A New Jersey tax-court judge has ruled that the New York Red Bulls owe property tax to the city of Harrison, despite playing in a stadium built on land owned by a tax-exempt public agency. The decision, if upheld, means that the team owes $3.6 million in back taxes for 2010 and 2011, plus similar amounts going forward.

Without getting too deep into tax law, public land usually goes untaxed — but it can be taxed, or can be subject to payments in lieu of taxes, if it’s used for a strictly private purpose. Given that all the money collected at Red Bull Arena flows to the Red Bulls, the judge ruled that the “public” nature of the land was an accounting fiction, and demanded that the team cough up.

Whether cash-strapped Harrison will see any money from this anytime soon is uncertain — the Red Bulls have promised to appeal, which could drag this out for years. (They’re also still stiffing the city on $150,000 a year in rent.) But at least there’s a chance of the city getting something back for its $80 million in land and infrastructure and $173 million new train station, aside from a bunch of muddy lots set aside for theoretical future development. (According to Business Week, payments from developers are running at just over one-tenth what was projected when the arena project was first planned.)

Given the number of teams that use the public-land, private-use dodge to avoid a stadium tax bill — which is to say, pretty much all of them — it’s going to be interesting to see if this ruling sets any kind of precedent. Given that tax law varies widely from state to state, and who knows if this will hold up under appeal anyway, probably not, but it’s an interesting idea for local governments to try to recoup some of the money they blew on stadiums in the hopes of sparking development that never arrived.

Last night my family and I attended the first regular-season game at Red Bull Arena, the new soccer-only home of Red Bull New York in Harrison, New Jersey. I wasn’t sure what to expect, in more ways than one — it was not only my first visit to this stadium, but to a live pro soccer match at all, so I was curious to see both the new building and the fan turnout.

Getting to Harrison, a rundown industrial town across the Passaic River from Newark, was easy: As the Red Bulls website suggested, we avoided the highway and took the subway to the PATH train to Harrison, for a total trip time from Brooklyn of a little under an hour. The stadium, as expected, is currently surrounded by unsightly vacant lots filled with standing water, and is relatively unlovely from the outside, but is pleasant and fairly cozy on the inside; we were up in the top deck in corner seats, and had a good view of all the action.

I was initially thinking that the aluminum seating bowl felt chintzy — for this, they spent $200 million? mdash; but I soon realized that I was missing the point. Though the game itself was lacking in that feature that other sports call “scoring” (the Red Bulls won, 1-0), it was exciting the entire way, in large part thanks to the frenzied sellout crowd, which in turn was in large part thanks to the architecture: When you have 25,000 people stamping on aluminum flooring in unison, it’s loud, and fun no matter what’s going on on the field. And that’s before even getting into the incessant smoke bombs being set off by the fan club (sorry, “supporters club“) section down front.

There were only two huge flaws in the Red Bull Arena experience (not counting the frigid weather, which there’s nothing the team could do anything about, unless the smoke bombs were intended to speed up global warming). First off, as has been noted a couple of other places, the stadium has no water fountains, and the bathroom taps only dispense hot water. And each person is only allowed to bring one sealed bottle of water with them. On a cold night in March, this was merely an annoyance (especially since water at the concessions stands is $4 a bottle); when it’s 100 degrees in July, and the lines for the concession stands are as long as they were during halftime last night, it’s going to be a lawsuit waiting to happen.

The other problem is going to require a more time-consuming fix. As noted, we arrived via PATH, and it was an easy trip. Getting back was a different story: Apparently the 99-year-old Harrison station hasn’t been upgraded to accommodate post-sporting-event crowds — I counted about eight turnstiles total — which led to horrific lines just to get into the station. (As one supporter trapped on line behind me muttered: “Great game, great stadium, better team, terrible traffic control.”) Door-to-door travel time to get back home to Brooklyn: Two hours and ten minutes.

The Harrison station is currently undergoing a $173 million renovation, of which there were few signs last night, but if Wikipedia is to be believed, it should eventually ease traffic flow considerably. Added to Harrison’s $80 million in land and infrastructure costs for the stadium, though, it means New Jersey taxpayers are spending about a quarter-million-billion dollars to support their new soccer stadium (and the surrounding development, of course, if condos and retail ever really sprout on those waterlogged lots). The game was great, but for prices like that, I wouldn’t mind a drink of water.

Red Bull New York held their first game at the new Red Bull Arena on Saturday (I’ll be in attendance at the official season home opener next weekend, and reporting back here), and the Newark Star-Ledger marked the occasion with an article with this headline:

Red Bull Arena opening in Harrison sparks nearby redevelopment

Unfortunately, neither the article itself nor the photo of the new stadium shows any signs of nearby redevelopment. In fact, the story reports that the stadium “sticks out like a sore thumb in a neighborhood of vacant warehouses and empty lots. … The local PATH station is a 10-minute walk away, and most restaurants are in the opposite direction, across Route 280.”

It’s always possible that the prospect of catering to hungry soccer fans will cause restaurants to sprout like dandelions, especially once they realize what a bad idea it is to take the bus from Newark instead of walking from the train. Though given that MLS clubs only play 15 home games a year, they’d better hope those fans are really, really hungry.