Five-Year Madison Square Garden Permit Inflates Pressure to Play Ball
A City Council committee shrinks the timeline for the Midtown arena’s operation as Penn Station plans hang in the balance.
A City Council committee voted Monday to issue a five-year special permit for Madison Square Garden, shorter than either the permanent permit MSG sought, or the 10-year license that expired earlier this year.
The local Council member stressed his desire for the owners of the famed arena to play ball with transit agencies in rehabilitating Penn Station, which is located underneath MSG.
During a Zoning and Franchises subcommittee meeting, Councilmember Erik Bottcher (D-Manhattan), whose district includes the complex, said that an antiquated loading setup for concerts and other events clashed with the intensifying transit activity underneath the Garden.
“Because of this use conflict, at this time the Council cannot determine the long-term viability of an arena at this location,” Bottcher said. “Therefore five years is an appropriate term for this special permit.”
Bottcher said the Council would require the development of a transportation management plan. The permit now goes to the full Council, where it is expected to be approved. Mayor Eric Adams has the power to review the permit and veto it if he chooses.
MSG Entertainment, whose CEO is James Dolan, had applied for a new special permit in perpetuity allowing it to fill its 22,000 seats, arguing that it is being treated differently than other sporting venues in the city, such as the Barclays Center and Yankee Stadium, which don’t need to come back to the city to get permits approved.
The five year term falls well not only below the permanent permit MSG sought but also the 10-year permit sought by the City Planning Commission, where a majority of seats are appointed by the mayor.
“While the City Planning Commission pushed for additional efforts to improve public space that were not included in what the Council passed, the requirement of a transportation management plan and loading improvements will lead to real improvements to New Yorkers’ experience of the area around the arena,” Department of City Planning spokesperson Casey Berkovitz said in a statement.
The city has provisionally allowed the venue to continue operating while the special permit makes its way through the permitting process known as the Uniform Land Use Review Procedure.
Clash of the Uses
A state-led effort to update Penn Station has continually factored into the politics of MSG’s application for a city special permit. That’s because in order to bring up to date the much-reviled transit hub, the MTA, Amtrak and NJ Transit say they need the entertainment company to make certain concessions, including property transfers to the railroads.
But MSG has not signaled a willingness to transfer the properties to the railroads for free. Further complicating the state’s Penn Station redo efforts is a development proposal from Italian developer ASTM that would involve acquisition of part of the MSG property, including the Theater at Madison Square Garden.
MSG Entertainment issued a statement shortly after the vote, calling the Land Use Committee’s decision disappointing.
“A short-term special permit is not in anyone’s best interest and undermines the ability to immediately revamp Penn Station and the surrounding area,” the statement reads. “The committees have done a grave disservice to New Yorkers today, in a shortsighted move that will further contribute to the erosion of the City – that’s true now and will be true five years from now.”
For years now, neighborhood advocates and elected officials have called for MSG to leave its home atop Penn Station, arguing the arena stood in the way of train station improvements. When the City Council last renewed the arena’s special permit a decade ago, Council members said Dolan should look to move the world-famous arena elsewhere.
But MSG executives have made clear they are not budging. Since it owns the property, getting MSG to move elsewhere or denying them the permit could be extraordinarily costly, with a state-estimated price tag of $8.6 billion.
The railroads took a markedly more aggressive position earlier this year, when they said Penn Station is incompatible with MSG. The railroads are calling for “land swaps,” in which they would receive a former mid-block taxiway, unused as a passenger dropoff site since the 9/11 attacks led to beefed-up security.
In a June letter to the City Planning Commission, MSG Entertainment executive vice president Richard Constable said that while the group is willing to work with the railroads, that doesn’t necessarily mean they’ll give up their property.
“As we have discussed with Department of City Planning staff, MSG’s commitment to partner with the Rail Agencies does not, in any way, mean that MSG must offer easements on our private property, or offer to transfer ownership of our private property, at less than fair market value,” Constable said in the letter.