Every time the owners of Madison Square Garden flip on the arena’s lights or power up the scoreboard, they’re digging their hands into New Yorkers’ pockets to the tune of $1 million a year, The Post has learned.
Under a sweetheart deal approved by state lawmakers in 1982, every Con Edison customer in the city is hit with an annual surcharge – an average of 33 cents per customer this year – to subsidize Madison Square Garden’s electric bill.
With more than 3 million Con Ed customers across the city, that 33-cent surcharge adds up to $90,000 a month, according to industry experts familiar with the Garden’s energy hand-out.
The electricity bonanza was part of a deal worked out with state lawmakers 22 years ago that also exempted the arena from paying property taxes in exchange for keeping both the NBA Knicks and the NHL Rangers in New York City.
When the law was signed by then Gov. Hugh Carey, the Garden’s former owners, Gulf & Western, were threatening to move the teams across the Hudson River to the newly built Continental Arena in New Jersey’s Meadowlands.
Cablevision, the current owner of the Garden as well as the Knicks and the Rangers, has inherited all the breaks negotiated decades ago and long after any threat to move the teams to New Jersey faded away.
But the property-tax exemption, worth $11.7 million this year, remains on the city’s books. Coupled with the electricity subsidy, Cablevision is lining its corporate pockets with nearly $13 million a year from city taxpayers and Con Ed customers.
A Garden spokesman refused to comment yesterday.
Mayor Bloomberg is fuming over Cablevision’s funding of a multimillion-dollar ad campaign that has attacked Hizzoner’s plan to contribute $600 million of city and state money toward construction of a West Side stadium for the Jets.
The high-stakes battle has pitted Bloomberg against Cablevision’s top execs, the father-and-son team of Charles and James Dolan, who have pumped at least $8 million into the ad campaign accusing the city of wasting money on a stadium.
Bloomberg has lashed back, challenging the Dolans to give up their property-tax break at the Garden if they care so much about the city.
“When these guys suggest that we shouldn’t be spending public monies, well, [if] the public monies would bring a lot more to this city, why don’t they give up theirs?” Bloomberg said recently.
The law granting the tax abatement and the energy subsidy was intended to last only for 10 years, but it was written so that it would take state legislation to undo it.
Plugged in
State lawmakers in 1982 gave the owners of Madison Square Garden a bundle of breaks to keep the Knicks and Rangers from moving to New Jersey. The value of the annual benefits, then and now:
Property-tax exemption
1982: $5 million
2004: $11.7 million
Electricity subsidy
1982: $360,000, costing each Con Ed customer an average of 10 cents
2004: $1,080,000, costing each Con Ed customer an average of 33 cents