"There are times, honestly, when I have to pinch myself to make sure all of this is happening... Growth and revenue, growth and profitability, it's just been really, really, good." This was according to Major League Baseball (MLB) Commissioner, Bud Selig, in November 2007, at the conclusion of the MLB owners' meetings.
And it would make one wonder if indeed MLB believes that it is but recession-proof, given the $6.75 billion dollars in revenue it took in for the 2007 MLB season and its $5.2 billion totals for 2006. But it is a reality that less and less discretionary income is available to average or marginal baseball fans going into the 2008 MLB season. And at the same time, gas prices at the pump are expected to flirt with $4.00 a gallon.
Even so, it has not deterred MLB and two of its two major league teams from cashing in on public entitlements, courtesy of the City of New York. It is well known throughout the country that tax abatements and waived property taxes are the modus operandi for many cities and counties in order to supposedly retain major corporate conglomerates, threatening to relocate elsewhere.
That brings us to New York's Mayor Michael Bloomberg who in 2004 gave himself credit for ending the squeeze by corporations from getting tax breaks to remain in NYC."We've essentially ended corporate welfare as we know it, by no longer paying companies - who wouldn't have left anyway - to stay in our great city," Bloomberg said back then.
But even after Mayor Bloomberg lauded himself as the anti-corporate welfare czar, monies to the tune of $650 million in city and state subsidies were given to Goldman Sachs to build its headquarters in Battery Park City, or 9/11's Ground Zero, and $240 million were allocated in givebacks to JP Morgan Chase, also to build in lower Manhattan, after stating that it would move to Stamford, CT, and later unsubstantiated by the City of Stamford.
Under the guise of revitalizing lower Manhattan after the streets were deserted as the result of the terrorist attacks of 9/11, this ploy by Mayor Bloomberg was somehow forgivable by the legislators and politicos of NYC and New York State.
Then came the new Yankee Stadium and the new stadium for the NY Mets. Both the NY Yankees and the NY Mets essentially led successful swindles, as both stole home with the blessings of City Hall. As both stadiums near the end of construction, with both planned to be ready for the 2009 MLB season, the tallying of total costs to the NYC and NY state taxpayers has begun.
On his weekly radio show on WABC New York on February 29, 2008, Mayor Bloomberg stated that, "Hey, we got a good deal at only spending $75 million each on Yankee and Shea..er..Citi Field stadiums." He was referring to the outlay in real costs by NYC for each of the NYC stadiums for the Yankees and the Mets.
But for the owner and founder of Bloomberg Communications and self-made billionaire, Mayor Bloomberg seems to have forgotten his arithmetic along the way. For the actual costs to the city and state of NY for the new Yankee Stadium will total over $800 million and for Citi Field, or what will be known as the new Mets stadium, $500 million has been tallied for a grand total of $1.3 billion in public funding for the two stadiums combined.
This includes tax-exempt bonds, on which the government will pay the interest, tax abatements on property taxes, new street construction, a new railroad station stop for Yankee Stadium, new car garages as well as re-construction of open space for the parks outside of Yankee Stadium, which were completely destroyed.
In fact, the residents of the area outside of Yankee Stadium, a minority community, are now without 400 trees and 21.5 acres of less park space, greenery and playing fields. Although NYC and the Yankees originally promised more parkland, they now include the top of the parking garages as open space, where playgrounds will be put. And while there is no shortage of propaganda on the benefits that new professional sports stadiums supposedly bring to metropolitan areas, that topic alone is worthy of an additional in-depth report and a far more realistic and intelligent discussion.
And as much as MLB and its owners want to praise themselves for their reputed black ink, it comes but at the expense of taxpayers and local communities, whether they are baseball fans or not. And more often than not, it comes at the expense of the poorer minority neighborhoods, which are but expendable to big business and to City Hall.
But the latest feat by MLB should make even bona fide global capitalists wince. For in a coup by one of the largest realty developers in the U.S., Vornado Realty Trust, has been granted by NYC's Planning Commission a waiver to building height restrictions on 125th Street and Park Avenue, which is the main thoroughfare of the historic neighborhood known as Harlem. In addition, Mayor Bloomberg has been campaigning to rezone the entirety of Harlem allowing massive buildings as tall as 29 stories in order to attract even more major corporate partners.
As part of the waiver to Vornado, which raises the height limit to 21 stories, or an additional 4 stories, in this mixed-use residential and commercial area, the building will include 630,000 square feet of office space and will contain a variety of corporate businesses.
With the steep rise in real estate costs in NYC, many corporate entities are willing to move uptown to save on leasing costs, even at the expense of displacing thousands of people from their residences or crushing over 70 small local businesses in the neighborhoods made up of African-Americans and Hispanic communities.
Of significance, is that those 4 extra stories, most likely to be approved by the NYC Council in the near future, will be occupied by none other than MLB and its new cable television baseball channel. MLB would occupy two floors for executive offices and the top two floors for television studios.
But the Vornado organization also gave NYC an ultimatum along with the height restriction being lifted. They said that without the additional four stories it would be a deal-breaker for them attracting MLB as an anchor tenant in its building and thereby the whole deal would be off.
But it gets even worse, as Vornado also demanded $15 million in a public funding incentive package for itself and an additional $5 million package of incentives to be paid directly to MLB by the City of NY. Out of that $5 million package part of it would be allowed to cover the costs for redecorating Commissioner Bud Selig's MLB headquarter offices at 245 Park Avenue, in mid-town Manhattan. This brings but new meaning to corporate-welfare.
The projection of revenue for the MLB baseball television channel, to launch in January 2009, and to be located temporarily in Secaucus, NJ, is somewhere around $550 million over its first 7 years, with a guarantee of a minimum of $80 million per year during that time. It expects between 40 and 50 million viewers upon startup and will initially carry only 26 non-exclusive live games, with the rest of the 24/7 coverage comprised of all-things-baseball.
In 2007 when MLB threatened to remove its MLB Extra Innings packages - allowing fans to pay a premium to cable providers to access many out-of-market games - from all cable and satellite broadcasters with the exception of Direct TV, it was Senator John Kerry and the Senate Commerce Committee which pushed MLB to allow Extra Innings to continue its agreements with Time Warner Cable, Cox Communications and the Comcast Corp. and they were allowed to continue to broadcast MLB Extra Innings for the 2007 season.
However, as the result of that arrangement in 2007, an agreement was made that MLB will own a 66.6% interest in its MLB television channel with Direct TV, Time Warner, Cox and Comcast divvying up the remaining shares along with a commitment from them to carry the baseball network for the next 7 years. There is no word as of yet on the status of the MLB channel on such remaining digital and cable broadcasters as Dish TV or Adelphia Communications nor confirmation that MLB will offer the channel on basic cable television.
But MLB in its arrogance, by taking its present fan-base for granted, should be doing some real world soul-searching right about now. For after 15 years of Bud Selig's reign of denial of illegal drugs in baseball and after the off-season MLB has suffered in light of the Mitchell Report, looking for handouts should be the last thing with which MLB should be associated.
It is bad enough that much of MLB's revenues come by way of the very taxpayers it seeks to disenfranchise, and namely the African-American communities in the inner cities. But for it to muscle its way into Harlem's neighborhood is more than ironic and should not merely be accepted as gentrification for a better NYC.
Some have speculated that by moving corporate jobs to Harlem, such will endear MLB to the black community it has virtually lost, both as active professional baseball players and as fans, and yet woo them back to baseball. And such speculation should be an insult to all baseball fans alike.
But until MLB makes an asserted commitment to retain its present fan-base as well as makes an investment in future generations to come, such as an in bringing African-American children and families back to MLB, it has no moral right to demand givebacks; much less in Harlem or outside of Yankee Stadium.
And perhaps a good way for MLB to make amends would be to start by using some of those givebacks to build some decent baseball fields for the kids of Harlem, rather than picking out new wallpaper patterns for its executives' office suites.
Copyright ©2008 Diane M. Grassi