July 21, 2011
"The development of the Hub is critically important to the Nassau County economy," Nassau County Comptroller George Maragos said. "It currently supports hundreds of jobs and has the potential to create thousands of construction jobs and permanent jobs as well as increase tax revenues."
Comptroller Maragos conducted a review to determine the economic feasibility of the current proposal to develop the Nassau Hub and retain the NY Islanders hockey team. At this point in time, a comprehensive analysis cannot be completed as the Lease Agreement with the Islanders is still under negotiation and several significant terms have yet to be resolved such as revenue sharing, revenue guarantees, cost overrun protections and the Islanders’ commitment to remain in Nassau County.
The Comptroller’s Office also reviewed the various third party studies. Each of these studies has assumptions that cannot be corroborated with the proposed contract terms. These terms are still fluid. It would be inappropriate for the Comptroller’s Office to further speculate as to what the finalized contractual terms will be and synthesize an economic analysis based on hypothesis.
Comptroller Maragos stated that, "without the final Lease Agreement, it is premature to opine on the benefits and risks of the Hub Redevelopment."
"The Nassau County taxpayers desperately need the development of the HUB to be a success," Comptroller Maragos said. "The redevelopment of the Coliseum and addition of a ballpark are steps in the right direction. The Comptroller’s Office will make sure that in the final agreements, the County Executive’s objective to protect the taxpayer from costs on the Hub Redevelopment is met."
In order to achieve the County Executive’s objective, the Comptroller’s Office recommends the following major enhancements to the current proposed agreement. Many of these we understand are already being negotiated:
1) The Tenant’s performance should be guaranteed as well as the payment commitment by the Tenant on cost overruns;
2) The Proposed Agreement and the Islanders Agreements should be concurrently reviewed and executed;
3) The 11.5% revenue-sharing on non-Islanders events needs to be clarified as to whether the Tenant will be responsible for this payment;
4) Assignments or subleases should not be allowed without the County’s approval, in its sole discretion, in order to protect revenue-sharing and minimum payments; and
5) The development rights on the 77 acres around the Coliseum should be retained by the County.
Comptroller Maragos confirmed that "the Comptroller’s Office will work with the County Executive and the Legislature to ensure that a final Agreement adequately protects the taxpayer."
The full report is available by clicking on this link:
Nassau Veterans Memorial Coliseum: Review of Proposed Redevelopment