WASHINGTON – A congressional panel has taken tough swings at the New York Yankees and New York City government over a new stadium for the Yankees. But neither the team nor the city budged from their positions on the $1.3 billion structure.
Rep. Dennis Kucinich said Thursday he found "waste and abuse of public dollars" in the financing of the new stadium under construction in the South Bronx.
Kucinich is an Ohio Democrat who heads the House Oversight and Government Reform Committee. He charged that city officials misrepresented to the IRS the value of the property, helping them to get special tax deals from the federal government and in effect dumping the cost of construction onto taxpayers. No one from the either the city or the Yankees spoke at the hearing.
As Kucinich spoke, New York's mayor, Michael Bloomberg, was in a nearby building testifying before a different House committee on global warming.
Earlier this week, Bloomberg defended the deal, calling it "a great project."
"We want these kinds of facilities here. Having new stadiums is as important as other things in terms of, not just the spirit for the people who live here, but our economy," Bloomberg said.
That's not how several Democrats on the panel saw it.
"In the case of the new Yankee Stadium, not only have we found waste and abuse of public dollars subsidizing a project that is for the exclusive benefit of a private entity, the Yankees, but also we have discovered serious questions about the accuracy of certain representations made by the City of New York to the federal government," Kucinich said.
The panel's investigation found "substantial evidence of improprieties and possible fraud by the financial architects of the new Yankee Stadium," he added.
The criticism highlights tensions felt nationwide as governments increasingly support stadiums for profitable pro sports teams with multimillion dollar payrolls.
Rep. Laura Watson, D-Calif., said her hometown of Los Angeles has gone without a professional football team for decades because city officials are unwilling to pay for a new stadium.
Given the current financial crisis gripping the U.S. economy, she said it made no sense for taxpayers to pay for construction of buildings for the benefit of sports owner tycoons.
"In this country we have allowed the upper class to destroy the middle class," Watson charged.
The lawmakers also complained that city and team officials had not provided information they have sought about the financing of Yankee Stadium.
The panel did hear from New York State Assemblyman Richard Brodsky, an outspoken critic of the deal, who charges that between $550 million to $850 million in taxpayer money has been committed to the project.
Brodksy's charges, based on city, IRS, and Yankee documents, include:
—The city manipulated the assessed value of the stadium to meet requirements for an IRS tax exemption. That included using comparable land values in Manhattan rather than the Bronx to come up with the value for the new property.
—City officials didn't disclose their purchase of a luxury box and extra game tickets and apparently there is no city policy on their use.
—The $366 million in additional funding sought by the Yankees to complete the stadium would be for a large video screen, not structural costs.
Previously, Yankee officials have accused Brodsky of factually inaccurate grandstanding after he voted twice in favor of the deal in the state legislature.
"The project has been one of the most transparent transactions undertaken in the city of New York and details have been recorded in voluminous, publicly available documents," Yankees spokeswoman Alice McGillion said earlier this week.