On June 15, 2005, the Yankees announced their plans to build a new stadium. On April 3, 2009, it opened to the public, on-schedule and ready for the 2009 baseball season. The old stadium had been renovated several times since its construction in 1923, yet suffered from outdated amenities and concessions, limited accessibility for patrons with disabilities, and occasional structural issues.
The new stadium is located one block north of the old location, at East 161st Street and River Avenue in the Bronx. Despite some community and New York City-wide opposition, the City Council approved both the construction and financing of the new stadium. Construction on the new 52,325 seat stadium is estimated to have cost more than $1.5 billion (40% higher than original estimates in 2005). The Yankees were expected to pay between $800 million and $1.1 billion of the construction costs, though official numbers following construction have not been issued.
The new stadium development will also include an expanded ferry terminal and a new commuter train station, jointly financed by the City and the Metropolitan Transportation Authority (MTA) for a total of $91 million (the MTA will contribute $52 million and the City will contribute $39 million). Located on the Hudson Line, the new Yankee Stadium Metro-North Station is expected to be used by up to 10,000 people on game days. Approved in the spring of 2006, the station opened on May 21, 2009. The station (E. 153rd Street) is connected to the Stadium by a pedestrian bridge.
The City has been heavily involved in both the financing and the development of the new stadium. In 2006, the City’s IDA issued $942 million in tax-exempt bonds to the Yankees, plus an additional $370.9 million in bonds in 2009 – $259 million of which are tax-exempt. Through the IDA, the new stadium is further exempt from city, state, and MTA sales taxes on construction materials-related purchases.
In addition, the land that the stadium sits on is owned by subsidiary of the City’s Economic Development Corporation (EDC), which means that the Yankees will lease the new stadium under a 40-year agreement, although the team technically pays no rent and is exempt from property taxes. If the team leaves the site before termination of the lease, they will pay the City $2 billion. The team will pay the City $30 million over the lease’s 40 years to help defray costs associated with the stadium per an agreement arranged by the EDC.
In addition to supporting financing of the new stadium, the City supported the development of new parking structures. In 2007, the IDA issued $225 million in tax-exempt bonds to the Bronx Parking Development Corporation specifically to finance the development of parking facilities. These bonds, combined with contributions from New York State’s Empire State Development Corporation, will finance the parking facilities that were estimated to cost $239 million in 2006. Parking expansion plans include 3 new parking garages and refurbishment of existing areas, totaling 4,500 new parking spaces.
In order to secure approval for the new stadium, the City and the Yankees agreed to replace parkland that existed on the site of the new stadium. The Yankees have contributed $10 million to create 32 acres of parkland that replace the 22 acres of Macombs Dam Park and John Mullaly Park, which were demolished during construction. In early 2009, the City’s Independent Budget Office (IBO) reported that the costs of replacing the park area absorbed by the new Yankees Stadium has risen to $195 million, up from the $115 million 2005 estimate.
The Department of Parks and Recreation has explained that the rising costs are attributable to expansions in the plan from 25 to 32 acres and unexpected clean up costs related to buried oil barrels and toxic waste. The replacement parks are scheduled to open to the public in 2011, later than originally planned. This has caused significant community concern.
Many members of the community have also expressed concern about the traffic and environmental impacts of the project. They contend that the project will encourage even more automobile traffic in the neighborhood which already suffers from high asthma rates. In addition, many are concerned about the large amount of public money that is being used to help finance the billion dollar project of a highly profitable baseball franchise. Critics like Good Jobs New York echo concerns about environmental impacts and the misuse of public funds, suggesting that the Bronx community and NYC taxpayers were largely bull-dozed by an insular, undemocratic set of negotiations between the Yankees, former City officials, and present officials.
As part of an effort to assuage community concern, the Yankees signed a Community Benefits Agreement (CBA) in 2006. The agreement was settled between the Yankees and then-Bronx Borough President Adolfo Carrion (D) and the Bronx Delegation of City Council. Many local groups were not included in the negotiation of the agreement, a point of ongoing contention for the community. The CBA includes a $28 million trust fund for the Bronx community (not specifically reserved for the South Bronx) and free sports equipment and tickets for the remainder of the 40-year lease.
Critics of the CBA suggest that the deal’s provisions do little to guarantee widespread community benefits but instead enable a biased distribution of funds by putting an appointed advisory panel in charge of the fund. Delays in distributing CBA funds have been well publicized, with no funds disbursed until 2008. However, further information about follow-through on the CBA is not readily available, and it is unclear if the $800,000 promised to local nonprofits in both 2008 and 2009 has been disbursed (and unclear who it has been disbursed to).
Proponents of the new stadium point to several benefits of the stadium. In January of 2009, the City’s Industrial Development Agency (IDA) determined the total net benefit to the City of New York to be $60 million. Yankees executives maintain that the new stadium generated 6,000 construction jobs as forecasted.
In April of 2009, the EDC announced that the new stadium provides 4,047 total jobs, 1,673 more than the old stadium (including full time, part time, seasonal, and contract) – though it is unclear if this number includes the 800 permanent, full-time positions that the Yankees expected to be created by the new stadium. In response to stadium supporters that point to the potential economic benefits to the neighborhood, critics are quick to suggest that the old Yankee stadium did little to help economic development of the South Bronx, currently the poorest Congressional District in the country.
Even on the verge of the new stadium’s opening, accusations continued to emerge that the City’s contract with the Yankees was a lopsided deal, providing excessive benefit to the Yankees at the expense of taxpayers. In early 2009, City Comptroller William Thompson Jr. criticized the City for its “financial incompetence” in negotiations with the Yankees, citing the City’s misjudged costs of replacing parks and demolition as the core problem of a poorly designed contract. The City’s contribution to development associated with the new stadium has reached $325 million, more than double original estimates made in 2006. Demolition of the old stadium began in March 2010.
In early 2009, Bank of America backed out of negotiations for a $20 million sponsorship of the new Yankees Stadium. In the midst of the current economic crisis, corporations – particularly banks – have become increasingly reticent to spend large amounts of money for the luxury suites and sponsorship deals that typically surround new stadiums.
The ramifications of this drying-up of corporate money are as yet unclear for the Yankees, though as of opening day, the Yankees still had hundreds of high-priced premium seats for sale. Though most fans and visitors have noted various improvements to the old stadium, many give mixed reviews, citing the high cost of construction (with significant public expenditure) and tickets as the key impetus for their misgivings.