City comptroller (and still possible 2009 mayoral candidate) William Thompson issued his long-awaited audit today of items the Yankees deducted from their city rent for “stadium planning” costs, as allowed under the lease they got from Rudy Giuliani as a going-away present in 2001. How long-awaited? The audit covers January 2003 through December 2006, which is so far back that Raul Mondesi and Sterling Hitchcock were still in pinstripes.
The comptroller’s conclusion, as Juan Gonzalez first reported in this morning’s News: The Yanks improperly underpaid the city by more than $11 million over that four-year span, and are now in the process of making good on their debt. The Steinbrenner clan has already submitted checks for about $7 million of this, and has promised to pay the balance next spring, assuming there’s any cash left in the checking account after signing C.C. Sabathia.
For those of you who recall the Voice‘s previous reports on the Yanks deducting such items as their stadium lobbyists and crystal baseballs presented as gifts, it’s not expenses like those that Thompson called foul on. Rather, he caught the Steinbrenners in a more basic error: In 2005 they’d taken advantage of a new lease clause granted by Mayor Bloomberg to take both their $5 million rent credit for that year and for 2006; then the next year they tried to deduct for both years again.
(Thompson’s report actually states that he noticed this double-dipping back in November of last year, and alerted the Parks Department, which acts as the Yankees’ landlord; he just chose not to make it public until now — coincidentally at the start of a potential mayoral campaign.)
Recouping the 2006 charges alone accounted for $9 million of the team’s overdue rent bill, with most of the rest resulting from dodgy accounting of things like concessions revenue and revenue-sharing payments.
So what about those lobbyists and crystal balls? The lobbyists, as the Voice reported two years back, were apparently kosher under the Giuliani lease, which specifically allowed charging taxpayers for “consulting” and “legal” help, even if those consultants were engaged in wheedling our elected officials out of more cash for new stadiums. As for the crystal balls, while Thompson did disallow $50,000 in contributions to a political action committee and $34,328 in “meal and travel expenses,” the report says nothing about the tens of thousands of dollars in receipts the Yanks submitted to the city for such items as gifts (like those dozen $135-a-pop crystal baseballs) and for stadium bar tabs at postseason games. Thompson spokesperson Laura Rivera, however, tells the Voice via email that “only demonstrable planning costs were allowed,” and “items such as the widely reported crystal baseballs were not included by the Yankees/Parks as items considered to be planning costs.”
There’s a lot to wonder about here: Were the Yankees so eager to shovel receipts the city’s way in an attempt to claim all their allotted deductions that they didn’t notice they’d taken the same deduction twice, let alone that they’d included such items as bills for umpire meals and a team exec’s tow truck charges? Didn’t anyone in the Bloomberg administration bother to check when the team deducted about $10 million from their rent two years in a row on what was supposed to be a $5 million a year rent break?
There’s still a lot to wonder about here: Were the Yankees so eager to shovel receipts the city’s way in an attempt to claim all their allotted deductions that they didn’t notice they’d taken the same deduction twice, let alone that they’d stuffed half their accounts payable files into the boxes of receipts sent over to the Parks Department? Didn’t anyone in the Bloomberg administration bother to check when the team deducted about $10 million from their rent two years in a row on what was supposed to be a $5 million a year rent break? And wouldn’t it be nice if someday we could get a nice simple list of everything we paid for as “planning expenses”?
For now, though, $11 million will have to do — only $271 million to go!
This article from the Village Voice Archive was posted on November 7, 2008