NY Democrats threaten facial ID lover James Dolan over $42M MSG tax break

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ALBANY — State Senate Democrats are aiming to deal Madison Square Garden chief James Dolan — who has stirred controversy with his use of facial recognition technology to bar perceived enemies form his world-famous arena — a big blow in the state budget due April 1.

A budget resolution expected to pass this week will include a proposal to strip the Garden of its 40-year-old property tax exemption while sending the roughly $42 million in expected annual revenues to the MTA, according to a source familiar with the matter.

“Millions of businesses across the state of New York pay property taxes and Madison Square Garden doesn’t. What’s wrong with this picture?” state Sen. Brad Hoylman (D-Manhattan) said.

The non-binding proposal could become law if Assembly Democrats and Gov. Kathy Hochul get on board with the idea despite past campaign cash from Dolan, who has invited Speaker Carl Heastie (D-Bronx) and the governor to drop the puck at MSG in the past while fighting criticism on other fronts.

Dolan has attracted growing criticism from elected officials like Hoylman and the powerful state Senate Finance Chair Liz Krueger (D-Manhattan) after the billionaire baron in late 2022 deployed facial recognition software against his perceived legal foes – including attorneys who merely worked for firms entangled in litigation against him.

Andrea Stewart-Cousins standing at a desk in the state Senate chambersThe Democratic conference led by State Senate Majority Leader Andrea Stewart-Cousins is proposing to strip MSG of a roughly $42 million annual tax exemption in a budget resolution expected to pass later this week.AP
Madison Square Garden from above with most of the seats darkenedThe lucrative tax break has remained in place for decades.USA TODAY Sports

This includes a mother who got ejected from a Rockettes performance at Radio City Musical Hall months ago while trying to see the show with her daughter’s Girl Scout friends.

Hoylman – whose district includes Madison Square Garden – has proposed legislation to remove the tax abatement while unsuccessfully pushing the NBA and NHL to sanction Dolan, who owns the Knicks and Rangers, over his use of facial recognition.

The “dystopian” Dolan tech is also stoking increasing heat from the State Liquor Authority, which is moving to end booze sales at the Garden despite his past threat to unleash alcohol-deprived Blueshirts to slam the agency with complaints after stopping sales himself.

State Attorney General Letitia James meanwhile is demanding docs from the company to show that its use of facial recognition technology does not violate New Yorkers’ civil rights.

And some public officials also say the City Council should not renew Madison Square Garden’s expiring permit to host more than 2,500 spectators if Dolan keeps the facial tech policy in place.

Madison Square Garden Entertainment CEO James Dolan also owns the Knicks and Rangers.for the NY POST

But the embattled Democratic donor has hardly backed down in his multiple-front fight against public officials despite the growing pressure.

“If you owned a bakery or a restaurant and someone comes in and buys bread and the next day they serve you a lawsuit, they say they hated it. Then the next day they say, ‘I’d like to buy more bread.’ Would you sell them more bread?” the mercurial mogul has previously said while defending his use of facial recognition software.

“If you’re being sued, it’s a personal thing,” he added.

An MSG spokesperson fired back at Hoylman and the budget proposal Tuesday while noting other sports venues get tax breaks or subsidies along with other special interests like the film industry, which state Senate Democrats have supported in the past.

“It’s interesting that Senator Hoylman is rallying to end governmental subsidies for corporations when just last year he voted in favor of legislation that extends a $420 million governmental subsidy for the film industry and currently sponsors legislation to create new subsidies for the musical and theatrical production industry,” the spokesperson said.

“Madison Square Garden is a significant job creator and an economic leader within both our community and the city.”

State Senator Brad Hoylman with extended arms speaking in the state senate chambers with red leather in the background and other people sitting. State Sen. Brad Hoylman has been one of the most outspoken critics of MSG in recent months amid speculation about the future location of the arena within his Manhattan district. Hans Pennink

News of the budget proposal was first reported by the Daily News, but it had not yet been formally proposed as of midday Tuesday.

A Hochul rep sidestepped the question about whether Hochul would ever support removing MSG’s tax break.

“Governor Hochul’s Executive Budget makes transformative investments to make New York more affordable, more livable and safer, and she looks forward to working with the legislature on a final budget that meets the needs of all New Yorkers,” the spokesperson.

Heastie – who has boycotted the New York Post for weeks following criticism by its Editorial Board – did not provide immediate comment.

One government watchdog welcomed news of the state Senate budget proposal while questioning its prospects in the give-and-take of upcoming negotiations among Hochul, Heastie and state Senate Majority Leader Andrea Stewart-Cousins (D-Yonkers).

“Hopefully the Legislature will pull the MSG tax break,” John Kaehny, executive director of Reinvent Albany. “We’ll believe it when we see it.”

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