Company NBC (first package - click here for second)
Date closed Authorized 12/1/1988

(Post closing amendments 5/14/1996, 6/11/1996 and 2/11/2003 - conversion from bond to straight lease)
Project Site 30 Rockefeller Center
Competing Sites Secaucus, N.J.
Maximum  City Subsidy $72 million

City Amount Tied to Job Retention

  

City Amount Tied to Job Growth

  
Type(s) of City benefits Then-Mayor Ed Koch offered the television network $72 million in PILOT (payment in lieu of taxes) savings, sales tax exemptions, commercial rent tax breaks, and a land tax abatement. In addition, the city's Industrial Development Authority agreed to issue $800 million in double tax-exempt bonds to finance the project, by far the largest bond package to date in the city's history.
Benefits from New York  State  
Total Benefits Allowed  
Benefits Distributed to Date (according to LL69 Report FY 2002) NA (deal closed before reporting law came into effect)
 
Promised Job Retention (not binding) 4,000
Projected job growth 0
Total Jobs 4,000
Jobs Reported in LL69 Report FY 2002 2,827
Layoffs About a month before the deal was finalized, NBC announced 700 layoffs.
Length of Contract 35 years
 
Project Purpose In exchange for the deal, NBC agreed to renew its lease at Rockefeller Center, its home since 1933, and invest $1.5 billion to modernize outmoded television studios.

NBC agreed to invest at least $300 million on machinery and equipment before December 31, 2003.
Clawbacks? Under the terms of the deal, which was amended in 1996, if the network were to leave the city rather than completing renovation of its headquarters and studios, it would have to repay all of the abated taxes to the city. But after 15 years there is no repayment, or "recapture," provision (New York Times, 12/8/87). No minimum employment levels  were imposed on the network.
Since then . . . Many raised concerns about this deal setting an expensive precedent for other companies to expect similar packages in exchange for staying in the city. Elinor B. Bachrach, special deputy state comptroller for New York City, acknowledged such concerns, "It's a very difficult precedent, because certainly other businesses may well feel they are entitled to the same thing. You're conveying a competitive advantage to a single company" (New York Times, 12/9/87).

Among the reasons cited by NBC CEO Robert Wright for staying and paying a premium for Manhattan space were the value of being in a facility they already know, the ability to attract a very prominent and specialized group of guests to be interviewed on NBC news programs produced at Rockefeller Center, and the reluctance of employees to follow the company to New Jersey. Naturally, these factors raise the question of whether NBC would have ever carried out its threat to move across the Hudson.

Responding to a New York Times editorial lauding the deal, Paul Kantor, Chair of the Political Science department at Fordham University wrote in a letter to the Times, "This 'deal' is corporate welfare of the worst sort: it is a form of tribute using funds that might otherwise go to ameliorate the urban social condition. Instead of lauding this situation, you should be calling for state and Federal regulation to discourage it and keep business from exploiting its advantageous bargaining position. That you compare this deal to a poker game in which the city is a winner shows a profound lack of social conscience and economic knowledge. The metaphor is appropriate only if the player you have in mind is spending the family grocery money to keep others from sitting at the gambling table" (New York Times, 12/24/97).

Jersey City Mayor Anthony Cucci on the deal: "If I were to try to match that, it would be a great injustice to all the people here. . . . [I suspect that NBC was just using us to see what they could get from New York" (Bergen Record, 12/8/87).
Corporate Notes General Electric Corp. purchased  NBC in 1986.
A note on sources -- Information in this deal comes from GJNY's examination of project agreements obtained through Freedom of Information Law requests, as well as news reports, minutes and notes taken at board meetings, and communication with our allies. The entries are a work in progress. For more information about the documentation behind GJNY's database, or to let us know about any developments that are not yet reflected here, please contact us at gjny@ctj.org or (212) 414-9394.
Date last updated: 2/4/04