The company is making a lot of money but has been off the tax roll since 1982.
The financial and sports media is praising Madison Square Garden owner James Dolan and the financial windfall that has been produced by Dolan’s Knickerbockers business playing in the National Basketball Association’s final round. The money is flowing in and the celebrities are showing up at courtside. But there is something that has been buried in all of the stories about the cash coming in. Madison Square Garden does not pay New York City property taxes. That is not unusual in the United States. Most sports venues are off municipal financial books. In 2024, the company brought in $942.7 million in revenue and had an operating profit of $122.1 million and the owner, Dolan, made $38 million.
In July 1982, New York state lawmakers voted to give the Garden’s owner, Gulf and Western Industries, a tax break. Gulf and Western did not have to pay its property tax bill for 10 years. The $5 million a year tab was waived in an effort to keep the Knickerbockers basketball team in Manhattan and block the owners from moving the franchise to the Nassau Coliseum in suburban Uniondale and the National Hockey League’s New York Rangers business to the Meadowlands in New Jersey. John McMullen bought the NHL’s Colorado Rockies franchise and moved the team to the Meadowlands as New York State cooked up a deal with Gulf and Western. New York Mayor Ed Koch pushed for the exemption because the Garden owners were complaining to him that paying the tax kept the Knicks and the Rangers from being on the same financial playing field as say the NBA’s Kansas City-Omaha Kings and the NHL’s Hartford Whalers. That tax bill has remained in place in perpetuity. Since 1982, there has been real no political appetite to revoke the property tax exemption no matter how much money the Garden makes.
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