Yankee Stadium charity called into question

NEW YORK — In the summer of 2006, when the New York Yankees broke ground on a gleaming new stadium in the South Bronx, they offered an olive branch to a community furious that more than 25 acres of treasured public parkland had been seized for the project. The Yankees created a charity, called the New Yankee Stadium Community Benefits Fund, which it intended to distribute almost $40 million in cash grants and sports equipment, along with 600,000 baseball tickets, to community organizations in the borough over four decades.

Ten years later, however, an examination of the fund’s public financial records and interviews with community members and a former administrator of the fund show that it has operated with little oversight or public accountability, neglecting those who live near the stadium and instead sending money to other, often wealthier parts of the Bronx that were not affected by the construction.

The fund also regularly donates to organizations with which it shares common board members. And although the Yankees provide $35,000 a year to cover operating expenses, the fund in 2011 began to allocate 10 percent of the grants it awards to cover its own “additional administrative costs.” Those costs have never been publicly explained.

Many Bronx organizations say they have benefited greatly from the fund. But they are generally not in neighborhoods around the stadium. Of the $6.8 million distributed by the fund between 2008 and 2015, the last year for which records are available, only 30 percent — $2 million — went to charities occupying the same ZIP code as Yankee Stadium or four bordering ZIP codes.

Such money is coveted in the neighborhood, one of the city’s poorest, where millions could go a long way.

Fund officials did not respond to numerous detailed email and phone messages seeking comment over the course of four months. Alice McGillion, a public relations consultant who represents the Yankees, said team officials would not comment on the fund’s activities or operation.

“All the other nonprofits that I know of who have grants for community organizations are very proactive in terms of alerting the community,” said Joyce Hogi, who is on the board of the Bronx Museum and has been involved in local nonprofits for decades. The Yankee Stadium fund, she said, is “like a deep, dark secret.”

Agnes Johnson, a member of the South Bronx Community Congress, a group of neighborhood activists who have tried to monitor the Yankee Stadium fund, said that “the funding and energy only goes to a select few.”

A six-person board of directors controls all grant-making decisions. Michael Drezin, a former administrator of the fund who unsuccessfully sued it for mismanagement in 2009, said board members were chosen because of their connections to elected officials.

Serafin Mariel, the fund’s chairman, has donated to the candidacies of the former Bronx borough president Adolfo Carrión Jr., campaign finance records show. Ted Jefferson, also on the board, was chairman of Carrión’s transition team when he assumed the borough presidency in 2001.

Another board member, Roberto Crespo, has been on and off community boards in the South Bronx for years. In 1997, he was forced to resign from Community Board 1 for lying about a proposal to build a group home for mentally ill substance abusers in the district.

Drezin himself worked as an aide to Maria del Carmen Arroyo, a former city councilwoman who, along with Carrión and two other elected officials, helped broker the community benefits agreement that established the fund.

Arroyo said she did not remember how the board was selected. When asked about some of the board members’ political ties, she said: “This is a small city. You can’t go very far without knowing anyone.”

She added that she believed community boards surrounding the stadium should have been the focus of the funds being disbursed.

A community benefits agreement, or CBA, is a contract that requires developers to provide specific amenities to residents affected by a large-scale development. They have been used around the country since the early 2000s and are usually signed by the developer and a coalition of community groups. The Yankees agreement was signed only by elected officials and the team.

“You could tell right away it was basically a slush fund,” said Lukas Herbert, who was ousted from the local community board in 2006 after he voted against the stadium and now works as a city planner in Westchester. “The Bronx delegation got to choose who to administer the fund they created. No person who cared about good governance would come up with a system like that.”

As part of the agreement, the Yankees also promised to award at least 25 percent of stadium jobs to Bronx-based businesses. The city was required to replace the forfeited parkland. It has taken more than a decade to restore approximately 84 percent of the lost green space.

Miya Chen, a staff lawyer at the Partnership for Working Families Community Benefits Law Center, a network of advocacy groups that assists communities in negotiating agreements with city governments and developers, called the Yankees CBA “a behind-the-scenes deal, something to tokenize the community, to say on paper they were going to give the community something when in practice it’s been really hard to hold the parties accountable.”

Over the years, at least $300,000 in grants has flowed to organizations that have shared common board members with the Yankee Stadium fund.

Susan Goldy, a real estate broker in Riverdale and the fund’s treasurer, also sits on the board of Riverdale Neighborhood House, a community center in the Bronx’s wealthiest neighborhood, which has received $17,000 from the fund.

In 2009, the fund contributed $20,000 to the New York Botanical Garden, where Mariel, the Yankee Stadium fund’s chairman, is on the board of trustees.

In 2010, Mariel was awarded the Spirit of the Bronx Award by the South Bronx Overall Economic Development Corp. The next year, the fund made a $15,000 contribution to the organization.

The Yankee Stadium fund has also sent $60,000 to the Bronx CUNY Scholarship Fund, of which Mariel was a co-founder in 2006.

Carrión, Crespo, Jefferson and Goldy did not respond to repeated requests for comment. Mariel declined an interview request via the fund administrator, Veronica A. DeJesus.

Although the community benefits agreement mandates that the stadium fund “shall distribute a complete annual report of its activities, including contributions and impacts,” no such report has ever been made publicly available. DeJesus, who has served as fund administrator since 2008 and worked with Mariel at New York National Bank for years, said in an email, “As far as annual reports, those reports are prepared and sent to the NY Yankees.”

McGillion, a representative for the Yankees on nonteam-related issues, refused to share the reports, saying they “aren’t our reports to give.” Instead, she said in an email, “The New York Yankees provide the support with money, tickets and equipment, but as part of the agreement we expressly are not involved in the distribution to the community.”

According to Drezin, the Yankees have tried to keep the fund at arm’s length since its inception.

“In my day, the Yankees wanted to keep as far away from the fund as possible, and with good reason,” he said. “They said their only legal responsibility is to pay the money.”

In a sworn complaint sent in November 2009 to the state attorney general at the time, Andrew M. Cuomo, Drezin claimed that Mariel’s interest in the fund was “self-directed.” When pressed on the issue recently, Drezin said he recalled “at least two or three instances” of Mariel offering grant money to organizations that promised to do business with his bank, although he could not provide specific examples.

“Mariel used his chairmanship in a way that would be more beneficial to him personally than the community taken as a whole,” he said.

The attorney general declined to investigate. When asked for specific reasons, Doug Cohen, deputy press secretary for the attorney general, would not elaborate. “The matter regarding the complaint that Drezin sent has been resolved through private litigation. We have no comment beyond that.”

The city’s Department of Investigation declined to say whether there was an active investigation into the fund.

Just as the fund’s annual report has never been publicly released, neither have details about who receives the 15,000 game tickets that are said to be distributed every year. Audits obtained through the state attorney general’s office show that the fund records the tickets as an “in-kind donation” in its financial statements, but does not disclose to which groups or individuals they are given.

Laura Otten, director of the Nonprofit Center at La Salle University, reviewed the fund’s tax filings and said she was troubled that the ticket disbursements were so opaque. “The audit note doesn’t indicate that these tickets are given with the expectation of being distributed to the community,” she said. “So you have to ask, what happened to them?”

To be sure, many Bronx organizations have benefited from the $6.8 million that has been distributed. SCAN New York, a youth and family services organization, has received the most money overall, netting $120,000 in donations over the years. The Bronx Children’s Museum has received $45,000, the most of any organization in the Yankee Stadium ZIP code. But often the money goes to communities far from the South Bronx.

In 2014, the fund sent $8,500 to the New York City Cat Coalition, a group of women helping feral cats in Eastchester, 7 miles from the stadium. It has also donated at least $18,000 to two private high schools in Throgs Neck, an affluent neighborhood 9 miles from the stadium.

The Edgewater Athletic Association, a recreation center in a gated community in Throgs Neck, has received $29,000.

Brendan McArdle, who has been in charge of the Edgewater Athletic Association for the last 27 years, said funds from the Yankee Stadium fund almost entirely sustain the existence of the organization. “I can’t emphasize enough how much this impacted the community,” he said. “Without them, I don’t know where we’d be. They’ve been very good to us over the years.”

According to McArdle, money from the fund paid for new swim lanes, computers, chairs, tables, tents and outdoor shelters. It also allowed Edgewater to participate in the New York Cares Winter Wishes program for the underprivileged. He said he found out about the fund via his local community board in 2010.

The fund’s relationship with the board in Yankee Stadium’s own community has not been as congenial. The district manager at the time, Jose Rodriguez, told The New York Post, “They denied us.”

The neighborhoods around Yankee Stadium remain some of the poorest in the country: 38.1 percent live below the poverty line, more than double the national rate and higher than in many other parts of New York City. The median household income is just over $26,000, well below average for the city.

According to the most recent State of New York City’s Housing and Neighborhoods, an annual report published by the NYU Furman Center, the foreclosure rate is the highest of any neighborhood in the city.

“It’s crazy if you think about it,” said Herbert, the ousted community board member. “To have money coming in for 40 years — the Bronx has a lot of problems, and that money could do a lot of good.”