Islanders, Nassau County announce lease agreement
{{#rendered}} {{/rendered}}The New York Islanders took an important step forward Wednesday toward their goal of getting a new arena that will allow them to stay on Long Island.
Nassau County Executive Edward P. Mangano announced that the county has reached a lease agreement in its plans to create a state-of-the-art sports-entertainment destination center at the Hub in Nassau County that retains Long Island's only major professional sports team through 2045 should residents approve building a new arena at the site of Nassau Veterans Memorial Coliseum.
A public referendum has been scheduled for Aug. 1.
{{#rendered}} {{/rendered}}"With this unprecedented agreement, we are paying for this state-of-the-art sports-entertainment destination while creating thousands of jobs and new revenues streams that benefit Nassau County homeowners and businesses," Islanders owner Charles Wang said. "The Islanders were born on Long Island, won four Stanley Cups for Long Island and want to call Long Island home for decades to come."
According to an independent economic impact analysis conducted by Camoin Associates, a nationally recognized firm in public and private sector economic development, the agreement will generate $1.2 billion. This revenue will be used to pay off the $350 million in construction costs associated with the new arena, $433 million in debt service payments and provide an additional $403 million for the County to hold the line on property taxes. Furthermore, Camoin Associates estimates the creation of 1,515 new jobs during the arena construction phase and the creation of 3,040 permanent jobs beginning in the first year the arena is operational.
"This historic agreement retains our New York Islanders while ensuring that residents earn dividends should they vote to invest in Nassau County's future," Mangano said. "From Islander tickets to concert tickets, pretzels to hot dogs, Nassau County will share in a portion of dollars spent at the new arena that residents will own. The construction of a new arena will retain and create thousands of jobs and be a catalyst to generate the revenue needed to hold the line on property taxes. Today's agreement is a giant step forward for Nassau's economy. Sadly, in past years Nassau took too many steps backward with the loss of Canon USA, Grumman, Avis, OSI Pharmaceuticals, the Nets and the Jets. This agreement reverses that trend."
{{#rendered}} {{/rendered}}Under the terms of this agreement, County taxpayers are guaranteed 11.5 percent of dollars generated at the new arena from all events -- not just Islander games. According to Camoin Associates independent report, this revenue sharing requirement, coupled with sales, hotel, and entertainment taxes generated from the new arena will produce over $28.2 million to Nassau County in the first year. The projected amount of revenue to Nassau County is expected to grow in subsequent years. With debt service payments fixed at approximately $26 million annually, Camoin Associates projects the new arena would generate the dollars needed to pay off this debt and an additional profit of over $400 million during the 30-year lease term. Residents will continue to receive millions in revenue without debt service payments; similar to paying off your mortgage and renting your home while keeping all income associated with that rental property.
The construction of a new arena will retain and create significant employment opportunities for the residents of Nassau County. According to the independent report issued by Camoin Associates, the project will create a total of 1,515 construction jobs and generate $121 million in wage earnings during the construction phase. After the construction phase, it is estimated that 3,040 permanent jobs will be created with $138.8 million in new wage earnings.
"Creating a sports-entertainment destination center will jumpstart our economy, create jobs and generate business for Nassau's hotels, restaurants and service providers," Mangano said.
{{#rendered}} {{/rendered}}The lease announced Wednesday caps Nassau County's construction, demolition and other project costs at $350 million. It also guarantees a $14 million minimum payment to the County. If citizens approve the construction of a new arena at the Aug. 1 public referendum and the lease is executed, the Islanders will reimburse the County for the costs of the public referendum. The lease agreement is for a new arena only. Any potential development at the site of Nassau Veterans Memorial Coliseum will be subject to a Request for Proposals (RFP) in order to maximize the benefits to the County.
The lease agreement was structured by Christopher L. Melvin, managing director of Nixon Peabody's Public Finance group who specifically focuses on stadium and sports finance. To ensure full transparency, both the lease agreement and bonds needed for construction must be approved by the Office of Management and Budget, Independent Office of Budget Review, County Legislature, County Comptroller and Nassau Interim Finance Authority.
The County Executive will host a series of public information meetings from 12 to 2 p.m. and from 4 to 8 p.m. on:
{{#rendered}} {{/rendered}}Wednesday, June 29 at the East Meadow Library at 1886 Front St. (Town of Hempstead). Thursday, June 30 at the William P. Bennett Hicksville Community Center at 28 West Carl St. (Town of Oyster Bay). Friday, July 1 at the American Legion Hall at 730 Willis Ave. in Williston Park (Town of N. Hempstead).
Additional public information meetings will be held July 11-15.