Billing the city for the lobbyists he hired to push his new stadium (now taking shape across the street from the soon-to-be-demolished House That Ruth Built) was, it turns out, the least of George Steinbrenner’s chutzpah. According to documents obtained from the parks department’s archives via the Freedom of Information Law, the Yanks submitted to the city for reimbursement such “stadium planning” costs as a dozen crystal baseballs presented as a gift by the team, and bar tabs for Yankees execs—plus a whopping $9 million in expenses incurred the year after the team’s sweetheart-lease clause expired. And it’s become increasingly clear that city officials diligently looked the other way while this was taking place.
The subsidies date back to a provision inserted into the Yankees’ and Mets’ leases by Mayor Rudy Giuliani on his last day in office, allowing the two teams to deduct from their city rent “planning costs” for their hoped-for new stadiums. This was specifically defined to include both the salaries of team employees working on stadium planning and unspecified “consulting” services—a clause that, as first reported by the Voice last year, allowed the Yankees to bill taxpayers for such items as the political operatives who lobbied the state and city for their new stadium deal; the salaries of team execs Randy Levine, Lonn Trost, and Hal and Hank Steinbrenner; and even the lawyers who drew up the new lease in the first place.
Mayor Mike Bloomberg has long insisted that his hands were tied by the Giuliani lease. But the latest documents show that Bloomberg’s largesse to the Steinbrenner clan has gone far beyond even what was allowed by his predecessor. The original lease provisions allowed the teams to deduct “all [stadium planning] costs and expenses incurred by or on behalf of Tenant during the Credit Period”—defined as from January 1, 2001, through December 31, 2005—up to a limit of $5 million per calendar year. By the end of 2005, however, the Yankees had only spent down $16 million of their allotted $25 million.
According to the parks department, the team was nonetheless allowed to deduct an additional $9,035,636 from its rent the following year, after the stadium-planning clause had expired. (The Yankees got an additional no-questions-asked $5 million rent break in 2006, as well as similar reductions in 2007 and 2008, courtesy of a clause added by Bloomberg as part of the final stadium deal.) Mayoral spokesman Jason Post says the lease was amended by Bloomberg in 2005 to allow late deductions “because the project was delayed.”
The team, meanwhile, was busily supplying boxes of receipts to the city to justify its deductions. But whereas the earlier receipts were limited to stadium-related expenses—although questionable ones, like the $700-an-hour lobbyist bills and restaurant tabs for engineering consultants—by late 2005, the files had begun to look like those of an organization hastily trying to spend down its account by billing the public for everything but the kitchen sink. Among the latest crop of items the city apparently reimbursed the Yankees for:
Tens of thousands of dollars in “gifts” of Yankees merchandise to unspecified recipients in late 2005. One receipt alone, submitted by team marketing vice president Debbie Tymon on September 10, totaled $1,620 for “12 crystal baseballs” from the Yankees’ team store—plus an $80 rush charge.
More than $26,000 in food and bar tabs at the Stadium Club during the two 2005 postseason games played at Yankee Stadium.
Innumerable small charges for such items as umpire meals, a tow-truck bill for a team exec, and the cost of shipping batting helmets to Tampa Bay during a Yankees road trip there.
Bettina Damiani of Good Jobs New York, a subsidy-watchdog group that has been a vocal critic of the Yankees project, says: “Every time you turn a corner, there’s something going on with this project. Every level of government that should have protected taxpayers and residents isn’t there.”
There’s no indication that city officials looked at the receipts once they were submitted. Parks department spokesman Warner Johnston says the Yankees were allowed to take the rent deductions based on their own self-reported numbers, and that it’s up to the city comptroller’s office to audit the rent credits.
But while City Comptroller William Thompson initially blasted the Giuliani leases for denying the city “pre-audit authority over the level and nature of spending,” the presumptive 2009 mayoral candidate has been less than enthusiastic about using his power to audit the Yanks’ claims after the fact. Thompson spokeswoman Laura Rivera tells the Voice that no audits have been done of the planning deductions since December 2004. Citing office policy, she would not comment on when—or whether—another audit would take place.
Until one does, there’s apparently no way of knowing precisely which expenses the Yankees intend to claim to justify their $5 million rent break. A team spokesperson wouldn’t comment on specific deductions, and both the parks department and the mayor’s office referred all questions to the comptroller’s office.
Dick Dadey, executive director of the Citizens Union, says the latest revelations only make the Yankees’ sweetheart deal even sweeter: “I’m not surprised there is lax oversight over an ill-defined phrase in the agreement. But to allow the Yankees to include such ludicrous expenses as part of their stadium planning defies any reasonable person’s sense of logic.”
Damiani points the finger at Bloomberg, who has built his reputation on minding the store: “To have nobody doing checks and balances on the New York Yankees is an embarrassment.”