Report Shows USTA Underpaid N.Y. By More Than $300,000
The USTA "cheated" N.Y. out of "more than $300,000 in rent by under-reporting its revenues" by at least $31M, according to a report cited by Hicks & Mongelli of the N.Y. POST. The undercount from '14-17 means that the USTA "owes the city at least $311,000 from its operation of the sprawling Billie Jean King National Tennis Center." Additionally, the N.Y. Comptroller’s Office said that its audit found additional evidence that the USTA "potentially failed to report" an additional $8M in revenue, which could bring the undercount up to $39M. Under its deal with the city, the USTA "must pay $400,000 in annual rent plus 1% of revenues" when the National Tennis Center complex generates more than $20M in receipts. The Comptroller’s Office also "scalded the Parks Department for failing to properly oversee the 99-year lease that allows the USTA to operate the tennis center, finding the agency often accepted UTSA’s financial statements at 'face value'" (N.Y. POST, 8/23).
LOOKING AT THE NUMBERS: The WALL STREET JOURNAL's Katie Honan notes in addition to the miscalculated revenue, the audit found that the USTA "didn’t report in-kind donations, including marketing services or beverages in exchange for tickets to the event." The audit also shows that the organization "didn’t report" more than $4M in "revenue from sponsors." The USTA acknowledged it underreported $14M in revenue, but "disputed the remaining sum." The organization said that the "discrepancy stems in part from the comptroller’s misinterpretation of the lease." Last week, the USTA "paid the city more than $143,000 of the money the comptroller said it owes" (WALL STREET JOURNAL, 8/23). National Tennis Center COO Danny Zausner said that he saw "no need to renegotiate the terms of the lease" with the city. Zausner denied that the USTA had obstructed the audit by the comptroller’s office." He said that the current lease agreement "favored the city more than any of its other deals involving sports facilities" (N.Y. TIMES, 8/23).