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The truth about New York City's West Side stadium rip-off
Bonanza for the "Billionaires Club"

April 15, 2005 | Page 2

CINDY KLUMB reports on New York City's stadium swindle.

MAYOR MICHAEL Bloomberg's stadium rip-off scheme is moving full speed ahead. On March 31, the Metropolitan Transportation Authority (MTA) board voted unanimously to sell control of the Hudson Rail Yards to the New York Jets, a crucial next step in the construction of a nearly $2 billion West Side stadium and convention center complex.

The Jets bought the Yards for about $210 million despite the fact that the only other bid submitted--by the cable television operator Cablevision--was almost twice as high at $400 million. The MTA estimated the market value of the Hudson Rail Yards at $923 million, yet sold it at a loss of almost $700 million--even though it faces a projected deficit of $1 billion in 2006.

But that's only a tiny part of what this stadium swindle is costing New Yorkers. New York City will spend $350 million to build a platform over the rail yards, from 30th to 33rd Streets, between 11th and 12th Avenues (Cablevision had pledged to build the platform at no cost to the city).

In addition, New York state has promised $300 million to put a retractable roof over the stadium. The city will kick in another $2 billion to build a one-mile extension to the number 7 subway line.

Other estimated costs to the city include: a platform over the West Side Highway ($55 million); a two-tier fan porch and pedestrian walkway, again over the West Side Highway ($66 million); a second pedestrian bridge over the highway at 39th Street to allow access to the ferry tunnel ($18 million); and a tunnel to connect the convention center to the Javits Center and the subway ($30 million). Additional parking garages will have to be built for patrons--again, at the city's expense.

One of Bloomberg's chief selling points for the stadium monstrosity is that it would help New York to land the 2012 Summer Olympics. But that's another money pit for the city. The Jets' proposed stadium is 200 feet too short and needs 10,000 additional seats to meet Olympic requirements. The cost of such an expansion: another $125 million.

The stadium project is supposed to bring jobs to New York City, and it will, but at an enormous cost.

The New York City Independent Budget Office (IBO) optimistically projected that the West Side Stadium and Convention Center will create 3,586 jobs--about half of the 6,791 jobs projected by the Jets. But the number of estimated jobs drops significantly to 1,179 in a stadium-only scenario.

This is important because the Jets believe that they can break even on their investment with a stadium-only operation. If the convention center proves to be more trouble than it is worth, nothing in the agreement with the city or the MTA requires the Jets to continue this use of the venue.

The construction phase of the project, from 2006 to 2009, is expected to produce 2,880 jobs. According to budget analysts, the cost of each of these jobs to city taxpayers would be $163,500.

Bloomberg and the other stadium boosters claim that the project will generate profitable economic development on the West Side, but they've neglected to mention a few facts. The NYC Environmental Impact Statement says that on game days, the stadium will cause massive traffic jams the complete length of both the West Side Highway and the cross-town Queens-Midtown tunnel.

Planned office and residential building projects, together with the stadium and convention center and the expanded Javits Center, would cut off the rest of the neighborhood from the waterfront. Rezoning will endanger protections for the Special Garment Center District and Special Clinton District, which favor small manufacturers and affordable housing.

The city's overburdened transit system will suffer, too--since building the most expensive mile of subway in the history of the world will siphon off funds from the 2nd Avenue subway line on the Lower East Side of Manhattan.

Different groups that oppose the stadium likewise point out that stadium projects in other cities haven't proven rejuvenated the areas around them--in fact, they usually have the opposite effect.

Bloomberg and the Jets both admit that the stadium alone won't generate enough revenue for the city--direct or indirect--to offset the public investment. The IBO estimates that new tax revenues would amount to an annual $28.4 million per year.

But this estimate is dependent on 17 stadium events (10 Jets home games and seven college games) and two concerts. The convention center will also have to host 20 exposition events, 2 mega events (such as an NCAA Final Four basketball tournament, a football bowl game or a national political convention), and two plenary sessions. If the stadium or the convention center fail to meet these expectations, tax revenues will go down, along with the economic impact on associated businesses and greatly reduced employment projections.

That's why New York Times columnist Bob Herbert wrote that the stadium project will benefit "the Billionaires Club. Ordinary New Yorkers need not apply." Obviously, the big winners would be Robert Wood Johnson IV, the billionaire owner of the Jets, as well as his friend, Michael Bloomberg, who set the deal in motion. Support from Gov. George Pataki and former Mayor Rudolph Giuliani (honorary members of the Billionaires Club) didn't hurt either, since the MTA board is appointed by the mayor and the governor.

Meanwhile, ordinary New Yorkers will face subway and bus fare increases, higher bridge and tunnel tolls, as well as extensive cuts in service. And if the stadium and convention center don't live up to expectations, then we can also expect higher taxes in the future--to pay for this expensive "shell game."

The fight against the West Side Stadium is not over. The state still has to approve the plan, and Cablevision has filed a lawsuit against the MTA's bidding process, charging that it was unfair. The Hell's Kitchen/Hudson Rail Yards Alliance, along with other community groups, has vowed to continue its fight against this political giveaway to corporate interests.

For more information, read the Alliance's Web site at www.nowestsidestadium.org.

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