Audit Report on the New York Yankees Rental Credits For the Third Quarter of 2003

AUDIT REPORT IN BRIEF

The Comptroller’s Office is required to audit all rental credits claimed by the New York Yankees for the maintenance of City-owned Yankee Stadium. Under the terms of the lease, the Yankees are responsible for the care and upkeep of Yankee Stadium, and the costs incurred by the Yankees for maintaining the stadium are offset against any rental income due the City from the Yankees. Thus, every approved dollar spent and accounted for as a rental credit for the maintenance of the stadium results in a dollar-for-dollar decrease in the rent due the City.

The audit found that Yankees rental credits submitted for the third quarter of 2003 were overstated by $128,909.53, as follows:

• $57,615.55in excess payroll charges and salary expenses that should have been paid by the Yankees.
• $63,047.13 in payments to PEM Electric consisting of labor and material costs that based on the terms of the agreement should not have been charged to the City.
• $664.93 in sales taxes and gross receipts taxes on fuel.
• $370 for purchases of supplies that are not chargeable to the City.
• $7,211.92 in Yankee Stadium repairs that are not chargeable to the City.

We recommend that the Yankees: deduct $128,909.53 from the total rental credits taken for maintenance pertaining to the third quarter of 2003; ensure that all maintenance credits claimed are properly supported by sufficient documentation; and obtain appropriate approvals from the Department of Parks and Recreation (Parks) before submitting rental credits to the Comptroller’s Office. In addition, we recommend that Parks ensure that the Yankees comply with the report’s recommendations.