Former Exec VP Joe Lhota Has Deep Ties to Madison Square Garden's 30-Year Tax Break

By John Surico

In between his roles as Giuliani's "Rat Czar" and the MTA's chairman, mayoral candidate and Republican frontrunner Joe Lhota spent his days at 4 Pennsylvania Plaza. For five years, he was an executive vice president of Cablevision; then, in 2010, he was named the chief administrative officer at Madison Square Garden Co., the "mega-corporation" that runs the world's most famous sports arena, as well as Radio City, the Beacon Theater, the Knicks and the Rangers. There, he was responsible for securing the best gift of all from Albany: a free tax ride for the corporation worth millions.

In 1982, at the end of Ed Koch's first mayoral term, the Knicks and the Rangers, two teams who call MSG home, threatened to leave the city. The city's fiscal insolvency of the '70s was only just dissipating and the economic boom of the late '80s had yet to take hold; as a result, the sports organizations, which bring millions of dollars in revenue to the city every year, felt threatened by the uncertain times and wanted an escape plan.

To retain them, Koch and the New York State Legislature granted the Corporation a tax abatement; by doing so, it would not have to pay any property taxes whatsoever. Thirty years later, this break has cost the city nearly $300 million; in the coming fiscal year, MSG Corp. will get away with not paying $16 million to the taxman.

But this is common procedure in New York. The Yankees, Mets and, now, the Brooklyn Nets have always been given profit incentives, courtesy of the taxpayer. As the New York Times reported, "Among them, the three teams are receiving more than $1.4 billion in subsidies over the next 40 years, including $230 million in property tax abatement."

Read more at http://blogs.villagevoice.com/runninscared/2013/06/former_vp_joe_l.php