Colombo: New Islanders Arena Won’t Mean New Money For Nassau County

By Nick Colombo
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Recently, I wrote that the new Islanders arena shouldn’t be built because there is no guarantee the facility would pay for itself and the money could be better spent on other things. Many people voiced their disagreement. Some disagreed with me just because they want their beloved Islanders to stay on Long Island by any means necessary. However, many others chose to disagree by arguing that this new facility would bring a substantial amount of new revenue to Nassau County.They viewed it as an investment, and said subsequent revenue may ultimately be used to lower taxes, fix the budget, and pay for other needed county improvements.

Well, I decided to test that theory. I did some research to see how much revenue the current Nassau Coliseum brings in, and using the most generous estimates I could think of, tried to see how much a new arena could provide to Nassau County. Now, let’s face it, lots of numbers makes for a boring article. So if you’re interested you can read all the data I collected below. If not, feel free to skip it and head right to the conclusion. I’ve marked both sections for you to make it easy.

The Numbers:

First, you should know where I got my data. It’s a combination of three sources. 1. A 2006 audit done by the Nassau County Comptroller of SMG, the company that manages the Coliseum. 2. The publicly available Nassau County Budget. 3. An article that appeared in Newsday in 2009 detailing the results of the new sub-lease the Islanders and Nassau County entered into with SMG.

What the County Gets –

In 2004, SMG paid Nassau County $297,270 in rent; $516,991 for water; and $919,074 for electricity. These are pretty much fixed prices, which will probably increase slightly from year to year, so for the sake of discussion we will use these to conclude the county gets at least $1,733,265 a year from Nassau Coliseum.

Now, the county is also entitled to percentages of parking revenue and concessions revenue. In addition, the county gets $1.50 per seat sold for every event. In 2004, Nassau County received $171,197 for concessions. However, this number was down because the NHL was in a lockout. In 2003, the county received $429,369 for concessions. We will substitute this number in to make our assessment more accurate.

For parking, the Coliseum receives 12.75% of parking revenues a year. The Nassau County Comptroller report says parking revenues average $2,000,000 a year. Thus, we can conclude the county gets approximately $255,000 a year from parking.

Lastly, the money from the ticket surcharge tax. In 2004, the county received $811,533 total from 46 events at the Coliseum. Of course with the NHL lockout active in 2004 that number is low. So let’s assume, if we use a little old fashioned division, that Nassau County gets about $17,642 per an event. If we have 41 hockey games plus the normal 46 other events, that’s 87 events. Multiply that by the $17,642, and we can expect that Nassau County gets about $1,534,854 a year for the ticket surcharge.

Adding all these together, we can conclude that Nassau County receives about $3,952,488 per year from the Coliseum. Considering it’s probably slightly more now, we’ll round it up to $4 million. In 2007, the Nassau County budget wrote that the county collected approximately $3 billion (that’s billion with a B) in revenue. Thus, the Coliseum accounts for approximately .13% of Nassau County revenue.

The Sub-Lease

          For those of you wondering if the Sub-Lease signed a few years back changes anything, it doesn’t. To quote an article that appeared in Newsday on the topic on December 26th 2009, “The deal gives nothing more to the county.”

The Conclusion:

So in a county that collects about $3 billion a year, the Nassau Coliseum accounts for .13% of that revenue with its contribution of $4 million. That’s right folks it’s not even a full 1%. In addition, this is only looking at revenue. I couldn’t find what the Coliseum costs the county a year in the maintenance they’re responsible for (roofing etc.). So it is possible they’re not even breaking even on the Coliseum at the end of the day.

Even if we very generously assume that the new facility will provide 10 times more revenue (through higher rent, more souvenir sales etc), or $40 million a year to the county, that’s still a mere 1.3% of all the money the county takes in. It’s a drop in the bucket, and we haven’t even considered how much of that revenue would go to cover maintenance costs etc. (Keep in mind we’re only talking about money going to Nassau County and the benefits to the county. I’m not trying to predict whether or not the Islanders would be making enough money to pay off the bond.)

Listen, I want the Islanders to stay on Long Island. But the argument that this project is also worth it because it’s going to create tons and tons of money for the people of Nassau County is a falsehood. Will it give some workers jobs during its construction? Yes. Will events at the facility generate money for nearby businesses? Absolutely. However, these are not the gigantic economic benefits supporters are claiming and posting all over this blog about.

Yes, this project will help some on Long Island economically. But the percentage of people being helped is smaller than most of you think, and way too small for the residents of the entire county to take on the risk of being stuck paying for a private company’s (the Islanders) new home.

Questions or comments? Email me at

Agree? Disagree (probably) with Colombo? Let him know in the comments below…

  • Drive45

    Even if everything you say is right, isn’t it better better to keep that 1% of the budget that the new Coliseum contibutes rather than let it go away?

    And as others have already noted, what about the trickle down effect on all the bars and restaurants and other businesses nearby?

    Also, what about the cost to the community of having to deal with the problems that will come with an abandonned Coliseum site, which will undoubtedly attract all kinds of undesirable elements?

    And with respect to Wang’s efforts to develop the area around the Coliseum, you say that that is not guaranteed. But NO investment is guaranteed! The new Coliseum is the best bet for Long Island.

  • Doug T.

    This project needs to get done. Outside of the beaches, what does Nassau County offer? It has become an eye sore. Ok, a few Parks and golf courses, i give you that. What about winter time? Where do we go for entertainment? Last time i checked, we have no ski resorts here. I guess the family will just have to wait for a few snowstorms so we can take the kids sleigh riding at Bethpage golf course. That is entertainment at it’s best. Why take in a hockey game or concert when we can check our local weather forecast on a daily basis and hope for a snow day? Exciting!

  • Peter

    A new arena will mean the Islanders may become successful again.Players do not want to come to the team now.They are considered worst arena. If the team is better there will be more fans coming to games based on a game day attendance and playoffs which will increase revenue as well.

  • Christian

    ‎”I’ve been poring through the 2006 study commissioned by Nassau County during the Coliseum site RFP process, and the do-nothing option projected that Nassau Coliseum and the Islanders generate over $60 million in tax revenue for the county per year.” that information is from this article

    • Michael

      thank you Christian for the other article. as for this story . . . Don’t build a new arena? While we are at it, don’t build any shopping malls, don’t build any baseball/football stadiums. Don’t build any movie theaters. People on Long Island are not allowed to see a live concert or show. Everyone should STAY IN THEIR HOUSE. You are not allowed to enjoy life. You are not allowed to meet in groups and celebrate and cheer for something. Why? Because there is no profit in it. Please, if the coliseum breaks-even and even make .13% money, then build it. It’s call QUALITY of LIFE and enjoying it. What kind of society to you want to live in?

    • Lawn-Guy Land

      That’s right – look only at revenue while totally ignoring COSTS.

  • justdoit

    Ok Mr Columbo, then tell us who will have to make up the 4 million bucks in lost revenue if a NEW coliseum IS NOT built and the old coliseum is closed and torn down??? Do you have an answer for that??? How about the many business’ in the area that WOULD be affected by the loss of a major venue for many events?? Where are WE as LONG ISLANDERS now supposed to go to see a concert, show, the circus, etc.??? So now we are all supposed to spend $20 round trip on the LIRR and pay twice as much to get into MSG or have to go to Jersey if you want to see a show. Yea, this makes a lot of sense!!

    • Nick Colombo

      Yes, you can spend 20 bucks on the LIRR just like people in Westchester and part of CT do. And I don’t know where the 4 Million will come from. But how much of a difference is that .13% going to make?

      • justdoit

        Answer, the 4 million bucks in lost revenue will be made up by RAISING TAXES!!!! I simply don’t care about Westchester and Ct!! LI has a larger population than Westchester!! And NO, I DO NOT want to spend $20 to sit on a dirty, filthy train for an hour only to put money into the Dolan’s pockets at MSG!! I’d rather pay the EXTRA $50 a year in taxes should this bond issue FAIL, then to spend it on the LIRR every time I wanted to see an event. At least my taxes would be staying in Nassau to pay for a brand new state of the art arena then to GIVE more money to “Mr Monopoly” Charles Dolan!!! Funny how LI’ers complain about high taxes yet passed 95% of the school budgets last week which account for 70% of their taxes. Go figure!!

  • ed deline

    very narrow interpretation. what about game days, any chance people go out for a drink or get a bite in the area? how about gas? how often do over 15000 people get together in the burbs? the workers who are hired to build, any chance they will spend? or are you figuring and empty lot will generate more?

    • Don, W Hempstead

      When was the last time the colisuem had 1500 people never mind 15,000 people. What guaranty is there that all of these”New” Construction jobs are going to even go to a LI basd company. Also the chant of More Jobs build now, did I miss something? Who siad thet they were only going to hire out of work construction workers to builf this project. It’s time people look at this project realistically… Sorry but this voters is voting – not on my dime.

  • Christian

    The town’s offer to Wang for their cut down project is still on the table. The only reason the plan was consider unprofitable was due to the cost of the arena. If the county is paying for the arena Wang can take the town’s plan and both the county and Wang can make a profiit. Din’t be surprised if this is pasted on August 1st if Wang accepts the Town of Hempstead’s offer.

  • Christian

    Yuo’re leaving out the money that is going be generated from the additional development of the site, which will be privately funded. The key to the entire plan is going be the additional develpment of the site.;JSESSIONID=372ECD9FA2BA450AD5D1.3083?site=newsday&view=search_results_item&feed:a=newsday_1min&feed:c=topstories&feed:i=1.2890943&feed:tag=newsday_1min,newsday_5min,newsday_10min&feed:max=50&feed:search=coliseum.

    • Nick Colombo

      Yea but that article says Wang, :”wants” to develop the site. He’d need approval for that. Just like he needed approval last time he wanted to do that. And we all know what happened. Point is none of that is a guarantee. All we can deal with now is what is being proposed – a new arena.

      • justdoit

        Why was’nt the Lighthouse Project put up for vote like the current arena proposal?? Why was that allowed to be rejected by a small group of political “PIGS” who refused to work or give credit to the opposing political party for trying to get something done. I’m sure most residents would have approved that project knowing the developers were willing to finance it themselves.

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