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New York City Comptroller William C. Thompson, Jr. today announced that the Staten Island Yankees have paid the City $1.4 million after an audit identified failures to reimburse the City for electricity, signage revenue, sinking fund capital contributions, and previous audit assessments.

“The Staten Island Yankees improved many of its internal controls since our last audit,” Thompson said. “I am encouraged that the Staten Island Yankees will continue to make progress and to adhere to the requirements of its City agreement.”

The audit – which can be viewed at www.comptroller.nyc.gov - covered January 1, 2005 to October 31, 2006. The audit determined whether the Staten Island Yankees paid the Economic Development Corporation (EDC) the rent due in accordance with its 20-year lease with the City to exclusively operate at Richmond County Bank Ballpark in Staten Island.

The agreement, in part, requires that the Staten Island Yankees pay EDC an annual base rent for actual game attendance, rent for the team store, and certain percentages of revenues generated from special event net income and from advertising revenues.

The audit determined that the Staten Island Yankees adhered to certain non-revenue-related requirements of its agreement, including: maintaining property and liability insurance endorsing the City and EDC as additional insured parties; depositing a required $50,000 security deposit with EDC; and paying water and sewer charges.

The review noted that the Staten Island Yankees did not owe rent for game attendance, team store or special events, and additionally improved their internal controls over reported attendance.

However, auditors determined that the Staten Island Yankees failed to pay EDC $1,581,154 for reimbursement of electricity use, signage revenue, sinking fund capital contributions, and previous audit assessments.

Nevertheless, at the conclusion of auditors’ fieldwork in January, the Staten Island Yankees signed a lease amendment and agreed to pay $1,427,899 in full settlement of all outstanding balances owed.

This monetary settlement was precipitated by the impending sale of the Staten Island Yankees through a total acquisition of interest by their minority shareholder. EDC confirmed in April that $1,427,899 was received by the City.

Thompson made two recommendations: that the Staten Island Yankees ensure that it remits to EDC in a timely fashion all required electricity payments, signage revenue, and sinking fund contributions, and that EDC ensure that the SI Yankees pay all lease fees on time.

The Staten Island Yankees refused to respond to the findings. EDC responded that the money has been collected, and that it will monitor the account closely and take appropriate action to ensure that payments are made on a timely basis.

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