Times, as you might’ve heard, are tough. People out of work in record numbers, economy setting fire to itself, states over budget, Terrell Owens being scapegoated by the media. Everyone suffers in times like these, and every community finds its own way to make ends meet. Louisville, Kentucky, is doing its part by shutting down the city’s famed Otter Creek Park (unless CSTB alum Joel Hunt’s letter-writing campaign stops it). It’s hard to top that standard of shortsighted ridiculousness, but the state of New York is doing its best to close a $15 billion budget deficit by basically making every regressive economic move it can. Doubling sin and sales taxes, jumping up tuition at state and city colleges, cutting civil service jobs like whoa, increasing licensing fees for barbers, putting slot machines in nursing homes, charging citizens 65 cents every time they burp: it’s all here.
Well, not “all.” Because the rich folk and the major corporate and financial entities in New York at which they work/ed still aren’t getting taxed. There aren’t quite as many of them — and they aren’t quite as wealthy as they were before — but New York is still an awesome place to be really rich. Let’s take a hypothetical on this point.
Say you are a hugely rich, constantly drunk-seeming loutish billionaire scion of a serial manager- and turtleneck-abuser and era-defining dickweed. And you own a parcel of land with an iconic stadium on it in the city’s most benighted borough (give or take a Staten Island). And, you know, you want to build another newer stadium right next to that pre-existing stadium, but in order to do that without incurring a big tax hit, you need to get the land on which your stadium sits assessed at…actually, you know what, let’s dump the hypothetical. Here’s Juan Gonzalez — yes, this Juan Gonzalez (no, not really) — in the New York Daily News:
Mayor Bloomberg’s aides secretly pressured city tax assessors to inflate the value of land under the new Yankee Stadium so the team could qualify for nearly $1 billion in tax-free bonds, city e-mails show.
In March 2006, the city’s chief tax assessor put the market value for the stadium site at $27 million, far lower than the Yankees wanted. A Finance Department official ordered him to redo the report. Within hours, he jacked up it up to $204 million…
(The emails) how that top aides in City Hall, the Law Department and the city Economic Development Corp. were obsessed with getting a high assessment for the new stadium site to please the Yankees. The city was forced to turn those e-mails over to the congressional and state committees. The Daily News obtained copies.
On Dec. 22, 2005, Michael Kalt, an aide to former Deputy Mayor Dan Doctoroff, wrote EDC officials, “I don’t want to get into this much further on e-mail, but we have to take into consideration that the AV [assessed value] is only so high because we’re choosing a methodology to support the tax-exempt financing.”
Kalt was City Hall’s point man for the Yankees project. He knew the Yankees needed a high assessment because the team was planning to pay back $940 million in tax-exempt financing with something called PILOTs – payments in lieu of taxes. The higher the assessment, the more tax-free bonds the team could ask the IRS to approve.
Kudos, obviously, to Kalt on doing such an awesome job that he’s now a vice president with the Tampa Bay Rays. I am tempted to leave it there, but I feel I should mention to non-New Yorkers that the entire Bronx, including the zoo, is worth like $700. Still, I’m glad that the Steinbrenners — proud non-New Yorkers and f-cakes that they are — didn’t have to pay any extra taxes on their new stadium. You will be, too, when you’re paying the city’s new soda tax.