Giants, Jets face off-field foe: NJ town wants NFL teams to pay property taxes

The NFL is full of owners and fans celebrating not only the start of the new football season, but also the debut of fancier pigskin palaces.

Down here in Texas we have the new Cowboys Stadium, while the 'Boys' NFL East foe the Giants share new digs in the Meadowlands with the Jets.

Standard operating procedure for most professional sports teams is to increase the prices each year that fans pay to actually attend games.

According to Mint.com, a
family of four this football season can expect to pay more than
$400 to go to an NFL game. That's nearly three times what they would have paid
20 years ago.

And the sports fan price tags are even higher in new facilities. Trust me; the hubby and I know, as we're planning a run up to Dallas (excuse me, Arlington) this season to cheer for or yell at (heck, get real; we'll do both) the Cowboys in person.

NJ wants its taxes from rich NFL teams: As for the costs that even non-fans pay, there are always battles over how much a community caves in, revenue-wise, to get a professional sports team within its boundaries. In most cases, some sort of tax breaks are provided.

But in New Jersey, the town of East Rutherford isn't rolling over.

East Rutherford officials have sent the New York Giants a $745,000 bill for taxes on a practice complex built on the same site as the stadium. If it's successful in collecting taxes on the training facilities, the city's mayor says the town will levy property taxes on the stadium itself next year.

"We believe the new stadium built for the Jets and Giants and the training facility should be taxable," East Rutherford Mayor James Cassella told the state's Local Finance Board at a meeting last week. "For some reason, they believe they shouldn’t have to pay taxes on a private development."

Uh, I think the reason they think that is that they get so many other special rules, including those that apply to taxes. As I mentioned earlier, waiving of at least some taxes is not unusual when new sports facilities are built.

In the Giants and Jets deal, the teams' new buildings, which are privately owned, sit on tax-exempt property. That's a continuation of the former Giants Stadium deal; that football field operated on the same site until last year and was exempt from property taxes because it was owned by a public entity, the New Jersey Sports & Exposition Authority.

In a joint statement following announcement of East Rutherford's tax collection plan, the Giants and NJ Sports Authority said the NFL teams' facilities are covered under a "payment in lieu of taxes" deal. Under this arrangement, the Sports Authority pays East Rutherford about $6 million in place of property taxes for the Meadowlands complex.

Not bad, but not nearly as much as East Rutherford figures it could get. East Rutherford's tax rate of about $1.54 per $100 of assessed value means that the $1.6 billion stadium would generate a bill of about $25 million.

Maybe the NFL teams, the state and East Rutherford could sell tickets to the court battles that I'm sure are about to ensue. It could be as entertaining as some Sunday afternoon match-ups.

Other sports-related tax collection opportunities: In addition to trying to get property taxes from the teams, states and cities also rely on the jock tax to bring in some extra revenue each football season.

This tax also applies to other professionals who do work outside their tax home, but jock tax is so much sexier than software engineer tax. In these circumstances, the worker owes taxes to the jurisdiction in which he or she goes to do work, for example, visiting a company's branch office to fix a problem there.

The jock tax also tends to provide a lot more revenue than might be collected from us regular workers. That's becasuse professional athletes make too much tons or money.

In most cases, salaries are a relatively small part of an athlete's fortune. The really good and/or popular ones tend to pocket beau coups more money via off-field endorsement deals.

Giants quarterback Eli Manning, for example, is the top NFL earner, says Forbes' Jock Rich blog, based on the younger Manning's combined NFL paycheck and annual endorsement income that comes to nearly $40 million a year.

The on-field play of Eli's older brother for Indianapolis, along with deals with Reebok, MasterCard, Gatorade, DirecTV, Sony and others, gets Peyton almost $25 million a year.

But get ready state revenue departments that collect jock taxes. Colts owner Jim Irsay promises that Peyton Manning's next contract will make him the NFL's financial top dog.