Red Bull Exemption Redux
Earlier this year in the 2010 tax appeal Red Bull Arena Inc. v. Town of Harrison, the Tax Court granted summary judgment to the Town and rejected a claim by the owners of the Red Bull Arena, home to the New York Red Bulls Soccer Club, that the property is entitled to a tax-exemption under the Local Redevelopment and Housing Law (“LRHL”). In consideration of the issue then, the Court found that the property is owned by the Harrison Redevelopment Agency, a municipal entity created pursuant to the LRHL, and leased to Red Bull through the Hudson County Improvement Authority. Pursuant to the terms of the lease, Red Bull is responsible for the payment of any real property taxes assessed.
Red Bull argued that the 12-acre property was acquired by the Harrison Redevelopment Agency to be redeveloped for the “public good” and that since the stadium provides a “public good” and the redevelopment agency is a tax-exempt entity, the stadium should be tax-exempt. The tax court judge rejected Red Bull’s argument finding that once the property was transferred to Red Bull and no longer held by the redevelopment agency, it no longer fulfilled the statutory purpose of redevelopment and was no longer exempt.
Now, in connection with an appeal for the 2011 tax year, the Town filed a motion for summary judgment on Count One of plaintiff’s Complaint where it is alleged that the property is tax exempt. In considering the motion, and Red Bull’s cross-motion for summary judgment, the court noted that Red Bull raised no new material issues of fact or law. The court granted the Town’s motion for summary judgment and denied Red Bull’s cross-motion. The Court again found that the LRHL is designed to exempt property acquired for redevelopment for that period during which it is held by the redevelopment agency until it is transferred to a private entity for development. During the land taking, development design and planning, demolition and land clearance, the subject property was a project of the agency and thus qualified for an exemption under the LRHL. But after the property was transferred to Red Bull, the exemption was lost.
A copy of the Tax Court’s letter opinion may be found here.
See also, Red Card for Red Bull Soccer Stadium, our February 11, 2012 blog entry regarding the Tax Court’s disposition of the exemption claim in connection with the 2010 appeal.
