Plans to build a new Yankee Stadium in the South Bronx have kicked up a small storm of local protest. Many people who live near Mullaly and Macombs Dam Parks, where the new stadium will be built, are concerned about what it will mean for their neighborhood, and rightfully so. But the crucial public policy question here is whether there will be a net benefit for residents of the Bronx and the other boroughs. The answer is yes.Oh-kay... so, who is this New York Times and what has it done with the real Zimbalist? As in the one whose dismissal of the kind of consulting reports that generate such projections ("They engage in a very, very dubious methodology. They make unrealistic assumptions and they can produce whatever result they want to produce.") recalls the famous former MLB president Paul Beeston's line about major league baseball team finances ("Under generally acccepted acocunting principles, I can turn a $4 million profit into a $2 million loss, and I can get every national accounting firm to agree with me.").
Those who want no disruption and the maintenance of the status quo need to think again. The existing stadium was built in 1923 and grows more unsafe and expensive to maintain with each year. The Yankees have been spending nearly $10 million a year on maintenance at Yankee Stadium -- money that their lease allows them to deduct from the rent they pay the city. Engineering studies say it's time to build a new stadium.
The Yankees are proposing a fair financial deal to the city. Nationally, during the last 15 years, the public share in stadium development costs (that is, the stadium plus roads, utilities and so forth) for professional sports has averaged around 75 percent. The Yankees are planning to spend $800 million of their own money on the new stadium (no major league baseball team has spent more than $300 million on their own playing field). The city and state together will spend about $210 million for improvements in the neighborhood. By this reckoning, the public share is only about 21 percent.
...All major investment projects, no matter how positive they may be for a community, disrupt the life of somebody. Undoubtedly, some residents will be made worse off. But as an investment, the Yankees' stadium plan is a winner for the Bronx and all of New York.
Public cost is $444 million, which is from this. The Yankees' cost I just did the math on for this [BP] article -- here's what I've got:As for the Mets themselves,
-$312 million revenue-sharing deduction
-$103 million future rent
-$15 million present rent
-$44 million property taxes
This is just on the expense side, and doesn't include whatever new revenues each side would get, which would reduce the public deficit to the $250-350 million range, and undoubtedly put the Yankees well in the black.
Suddenly, what looked like a $444.4 million expense for the Mets -- which would have been a larger private contribution than any prior stadium in baseball history -- has become a far more manageable $104.5 million, right in line with what other teams have paid of late. The public, even by the state's own optimistic economic projections, would be left with a minimum of $178 million in red ink after paying for land and infrastructure, plus all those tax and rent breaks.Count deMause -- co-author of Field of Schemes -- as among those responsible for spreading that meme, and tip your cap to somebody who understands that while big shiny ballparks are fun to imagine, the devil is in the details, and the details of Yankee Stadium #3 (The House That Ruthless Exaggeration Built?) don't paint a flattering picture of the Yanks or of Zimbalist's endorsement.
I think we can officially call this a trend. Back in the bad old days of the 1990s, spending public money on stadium construction was relatively uncontroversial, with debates limited mostly to who exactly would get stuck with the tax bill. (Cigarette smokers and car renters were two popular targets, mostly because it's hard to tax child molesters and puppy-kickers.) But more recently, as the general public has started picking up on the "stadiums are bad investments" meme, sports team owners and their political allies have increasingly started looking for ways to, if nothing else, make the transmogrification of public dollars into private profit less obvious. In the latest example (non-baseball division), the New York Times' Charles Bagli revealed last week that the two local teams in that other sport with the pointy ball are expecting windfall profits from their new "privately built" stadium in New Jersey; the state, meanwhile, will be giving up 20 acres of free land and getting shut out of parking, luxury suite and ad revenues.
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