COMPTROLLER THOMPSON VOTES "NO" ON ADDITIONAL FINANCING FOR NEW YANKEE STADIUM
-Comptroller's Office asks for postponement of vote, but Board ignores request-
New York City Comptroller William C. Thompson, Jr. today harshly criticized the Industrial Development Agency Board for voting to approve additional bond financing for Yankee Stadium because the project will inevitably cost city taxpayers hundreds of millions of dollars more than initially expected.
"I am deeply disappointed by today's vote," said Thompson, the sole IDA Board member to vote against the deal. "In light of all that has been uncovered about this deal, I believe it would have been in the best interest of the city and its future to renegotiate the current terms of this deal so that the terms were fair and equitable to the people of New York City. Now, because of this Board's actions, we have lost that valuable opportunity."
"I originally supported this deal, because I believe that a healthy city is a city that is always developing, innovating and growing. And when the deal was made to finance the new Yankee Stadium, it was sold to the people of
The Comptroller's vote was the only one cast against the measure at the meeting.
Earlier this week, Thompson announced details of his financial review of the Bloomberg Administration's deal to help finance the new stadium. The review found that the original estimated costs for new infrastructure and parkland were grossly underestimated and then swelled into much steeper costs. There also were instances where necessary work was not accounted for at all in the original estimates.
"These costs did not grow solely because of increased labor and materials as was represented by the IDA at yesterday's public hearing, but rather because of incompetence or an intentional attempt to mislead the public," Thompson said.
When this project began, the Administration claimed that the City would make a contribution of $129.2 million dollars for parks and infrastructure improvements alone. This contribution ballooned to a staggering $325 million, two and one-half times the amount the Comptroller was told about in 2006. That amount will, no doubt, continue to grow as construction continues.
Thompson cited the following as examples of faulty cost estimates:
· The demolition of the existing Yankee Stadium was estimated at more than 50% less than the true cost.
· Failure to conduct environmental reviews, which would have taken into account the existence of, and necessity to remediate, oil tanks on the waterfront site of a planned new park.
· Underestimation of the cost for a rooftop park and retaining wall resulting in cost escalations of 30%; the price tag now stands at $44.5 million.
"My analysis uncovered construction and demolition estimates that were low-balled and instances where work was not accounted for at all," Thompson said. "The City also gave up significant revenue-generating concessions like naming rights, billboards, and parking spaces - money that could have gone to help our seniors, subways, and schools during these tough economic times."
"Under the current terms, the Administration is giving away the store to the Yankees and getting too little in return," Thompson said.
Thompson's representative on the IDA Board, Deputy Comptroller John Graham, first implored the Board to postpone the vote, which was held one day after a public hearing on the matter.
"When the City made the original deal to help finance the new Yankee Stadium, Comptroller Thompson supported it because he believes that
Just as troubling was the IDA's refusal to share with the Comptroller's Office the numbers behind its cost-benefit analysis, an analysis that appears to be so bloated that it cannot be relied upon.
"Given these questions, and the findings the Comptroller's Office has highlighted regarding the cost escalations that were not adequately or completely disclosed to us in 2006, the Comptroller calls on this Board to fulfill its fiduciary responsibility to the people of this city by postponing this vote," Graham said. "A delay will the give the City time to renegotiate the terms of this deal so that it is fair to the people we serve."
In November 2008, an audit conducted by the Comptroller's office found that the Yankee's underpaid the City more than $11 million in rent over a two-year period. As a result, the Yankees have since paid the City $7,352,519 plus interest of $635,132. The Yankees still owe the City another $4,035,636.
You can view the Comptroller's previous remarks and the Yankees audit at www.comptroller.nyc.gov .
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