THE BUSINESS AND POLITICS OF SPORTS
Last Sunday should be the happiest day of the year for New York Red Bulls fans. The soccer season began with a game at the 3-year-old Harrison stadium that comes equipped with all of the state of the art right gadgets that owners think fans crave -- luxury boxes, expensive seats, and big priced food.
But for those living in Harrison, last Sunday’s soccer match only served as a reminder of a development project that went totally wrong and has put the city in bad fiscal straits. But if there is any good news for Harrison taxpayers, they are not alone in owing big money for a stadium that was supposed to have provided a shot in the arm for the local economy.
Harrison, Newark (the baseball stadium), Ramapo, New York, Cincinnati, Ohio and Indianapolis, Indiana have suffered the same fate. Invest a ton of money into a sports arena and see the investment turn into a sour deal.
Even though Harrison did not directly invest into the stadium, the Red Bulls ownership did, the city purchased the land that houses the stadium and paid for preparing the land for construction.
It cost Harrison taxpayers $39 million and the municipality is hemorrhaging money on the project, so much so that last December Harrison had to borrow $3 million to pay down the debt on the $39 million it borrowed in 2006 to clear the land.
Harrison wants some of the money back from the soccer team, and it wants it now.
The biggest question that needs to be answered in the 2012 Major League Soccer season will not come from a result on the field but rather a judge in some courtroom.
It will be finances and will Harrison salvage something by getting a check for property taxes at the stadium site.
The New York Red Bulls franchise, which operates in a Harrison, New Jersey stadium, doesn't want to pay property taxes to the municipality. Red Bulls owner Dietrich Mateschitz refused to pay his 2010 and 2011 tax bill, which comes out to about $3.6 million because the team's lawyers feel that the land underneath the stadium is owned by the tax-exempt Harrison Redevelopment Agency.
Why should Mateschitz pay for something he doesn't really own? The land below his soccer stadium.
In a Newark courtroom in January, Judge Christine Nugent told Mateschitz's lawyers that she disagreed with the Red Bulls franchise claim and ordered the team to pay the property taxes. The Mateschitz’s franchise lawyers appealed Judge Nugent's ruling.
The judge also said no to another notion that the franchise put forth. Red Bulls attorneys said because the team-owned stadium serves a public purpose, it should be tax-exempt.