Perky 'Islanders' Have Own Sport, Arena Controversy

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An Islanders arena campaign ad tries to warn of the consequences of a "no" vote, by using actual footage of the team's defense dissolving.
Today's Daily News features an editorial on next Monday's New York Islanders arena vote, which is notable for a couple of reasons: One, it's a rare acknowledgment by the New York media that there is, indeed, a sport known as hockey; and two, it's an even rarer admission that there's another hockey team in the area in addition to the Rangers and that one in New Jersey that wins Stanley Cups every so often, a team that otherwise survives in New York sports lingo only in the archaic expression "Potvin sucks!"

The Islanders arena saga has dragged on even longer than the Islanders' playoff drought, and has until now been just about as fruitless. Way back in 2004, Islanders owner Charles Wang was proposing a $200 million of the Nassau Coliseum — which opened even wayer back in 1972, with a basketball game between the New York Nets and the Pittsburgh Condors — surrounded by a development called the Lighthouse Project, which was to include hotels, housing, offices, and a 60-story lighthouse modeled on the Great Lighthouse at Alexandria. After many twists, turns, and rumors that the Islanders would move to Kansas City, that plan was torpedoed by local officials last summer, leading Wang to go back to the drawing board.

What he came up with this May was a new mega-development plan, this one with no lighthouse, and no Nassau Coliseum either. Instead, there would be a new arena, a minor-league baseball stadium (presumably for an Atlantic League team to compete with the Long Island Ducks), and housing, all paid for by $400 million in county bonds. In exchange, Nassau County would get a cut of the arena proceeds — 11.5% worth, to be exact — assuming voters in the all-but-bankrupt county approved the plan at the ballot box in a special election on August 1.

It's an unusual deal by modern arena standards, in that while taxpayers would be fronting the construction budget, the team would actually pay annual rent on the building. (Compare, for example, with the Indiana Pacers' arena deal, where the team owners pay only $1 a year rent and no property tax — and subsequently convinced the city of Indianapolis to pay them $10 million a year for their own operating expenses.) On the other hand, the rent would rise and fall with the team's fortunes at the box office, which given recent history can't be very reassuring to voters.

Which brings us to the other oddity about today's Daily News item, which is that it took the rare step of outright slagging a plan that has the support of Nassau's political and business leadership. (A bit too much support on the political front, in fact: Nassau County executive Ed Mangano has been accused of running an illegal vote-yes campaign out of his public office.) As the editors write:

Sunnily, the Islanders foresee an astonishing 73% rise in attendance, producing $229 million in annual gross revenue.

Multiply that $229 million figure by the 30-year life of the bond issue that Mangano is proposing, and you get a stupefying $6.9 billion. Just the .9 part is more - actually, a lot more - than the $768 million in total debt service the county expects to incur on the arena.

That being the case, the county would be much better off passing on Wang's promise of a cut of the action and requiring him to raise private financing - assuming private lenders would give him money at a reasonable rate. If not, why should the public?

The legislative office is far less optimistic than Wang. It projects, perhaps, a 14% jump in attendance, an amount that would require the Islanders to pay the county only $14 million a year - which is, oh, just $12 million a year less than the county would have to pay on the bonds.

The News goes on to note, rightly, that much of the $3 million in sales tax revenue projected to accrue from the arena project would be cannibalized from elsewhere in the county; and concludes, somewhat less rightly, that "every taxpayer would have the privilege of spending $20 or so a year in order to enable Wang to enjoy gross annual revenues, by his own calculation, of $229 million." (If Wang grosses $229 million a year, taxpayers will get their $20 apiece back; if not, taxpayers take a bath, but Wang doesn't do nearly as well either.)

In short, Nassau County voters are being asked less for a giveaway than to stake Wang to a gamble: Put up $400 million in tax money, and end up with somewhere between clearing a profit and posting a $12 million a year loss. And, of course, guarantee the right to keep watching the Islanders for decades to come — which could be the biggest gamble of all.

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17 comments
Andy
Andy

Unfortunately, this is the only option that Wang was given.  If left entirely to his own devices, he would have preferred to construct the Lighthouse house with his own money.  It was the Nassau County political machine that stopped that (Kate Murray from Hempstead, to be exact.)  Nowhere in your article do you specify what revenues would becoming in and relief to Nassau County taxpayers would occur when the Islanders leave and Nassau Coliseum is shuttered.  We would lose thousands of jobs, and lose millions in tax revenue.  Agendas aside, Neil, but if the choice is $13 a year now, or who the heck knows how much it would cost us with no Coliseum, I choose the $13.  Vote YES on August 1.

Isleofmyown
Isleofmyown

Perfect example of writing something that will poke the bear. Don't know when this snarky writing style became acceptable. You probably didn't even call the Islanders to check a single fact. You probably should.

Charles Scott
Charles Scott

I wanted to thank you for this great read!! I definitely enjoying every little bit of it I have you bookmarked to check out new stuff you post

Pens5959
Pens5959

Islanders need to move out of the hockey wasteland that is the New York Metro area and to a place where they love the sport like Hamilton or Quebec City. Hopefully the vote goes against Charles Wang on August 1st and this franchise will be on its way to a real hockey market.

nyifancentral
nyifancentral

That's kind of funny considering not long ago the Pens were playing in front of 10,000 fans and everyone was saying the same things about the Penguins market as they were relocating and Mario was giving away his star players for nothing to make payroll.

Neil deMause
Neil deMause

Oh, it's way less swindleous than the Yankees deal, surely. But it's still the public putting up 100% of the cost and getting back 11.5% of the revenues, and likely ending up with a loss of at least a few million dollars a year. That might or might not be a cheap enough price to be worth holding your nose and voting for if you're an Islanders fan (or just want this whole soap opera to be over with), but it's hardly a gift to Nassau County.

nyifancentral
nyifancentral

It's 11.5 of the revenue and 14m dollars a year in rent. That's around 18m a year over 30 years which comes to well over 350m. That's how this pays for itself over time. Wang also made clear he's not developing anything there and has no right to do so. 

nyifancentral
nyifancentral

Neil, my point is the Daily News editorial lied and contradicted their own past articles on Stadium bonded construction writing the the Yankees financed construction of the new Yankee Stadium. The Mets financed Citi Field. How can anyone except an editorial based on contradictions by their own paper, how can you?

nyifancentral
nyifancentral

Come on Neil. be fair. The Daily News in their first editorial against this wrote all the other local teams paid for their own stadiums, is that a joke after the Daily News wrote about the Yankee and Met taxpayer bonded stadiums (the house that you built, Mike Lupica) where they came back for more money or the Msg exemption for life which is why they are doing a renovation to keep it. If the Daily News is going to lie here only to defeat this that is not fair or objective reporting. Every other team got taxpayer money and a lot more than one where tennant is paying  18m a year (combined) over 30 years to payback 350m of a bond. Compared to Yankee Stadium swindle that is a gift and you know it.

Neil deMause
Neil deMause

"can't expect much from a rookie reporter."

This is my favorite comment of all. It makes me feel young again, young!

Linus413
Linus413

You really should proofread your work. It's got embarrassing, simple mistakes and an overall lack of clarity.

Ghjk
Ghjk

This article literally makes no sense.

Steve
Steve

can't expect much from a rookie reporter.

Curley
Curley

You are uninformed. Research before you write a poor article. With no more concerts coming to the Coliseum, that is a lot less coverage the Village Voice would offer. Vote Yes, your job may depend on it.

mond
mond

The Islanders have a better Stanley Cup to years in the league ratio than the Devils and the Rangers. Go hop on a fat one

Ross
Ross

Your an idiot.  Islanders have 4 stanely cups, thats the same amount the Rangers have. And the Devils only have 3.  Guess what? You're still an idiot.

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