TALLAHASSEE ? In 1998, the Professional Golfers' Association of America asked Florida for $50 million to help build itself a hall of fame near St. Augustine.

 

The state told the PGA it had to qualify for the money just like all other sports entities in the state. The legislature passed a law saying that to get the $2 million-a-year payments for the next 25 years, the professional golf hall of fame had to show that the sales tax it generated would "equal or exceed $2 million annually."

 

But when the PGA turned in its application with an economic analysis proving how it would reach that figure, the hall of fame's tax revenues were not the only revenues factored into the equation.

 

It included tax revenues generated from golf courses built around the hall of fame. It included hotel and motel construction revenues near the facility and residential development in the area. It included construction costs for the World Golf Village, the complex where the hall of fame was built; a nearby IMAX theater; a putting course; and a golf academy.

 

Together, the analysis said, that could mean $38 million a year in sales taxes generated by 2019.

 

The hall of fame was approved.

 

When asked why the state allowed for all of those inclusions when the statute clearly called for sales-tax revenues derived only from the facility applying for the state money, Admin Pendleton, executive director of the Florida Sports Foundation and a member of the three-person board that approved the request, responded: "That's a good question."

 

He later said an administrative rule might have allowed it, but he couldn't provide a copy of the rule or answer how a departmental rule could change requirements set by law.

 

A year later, the International Game Fish Association didn't need a generous interpretation of the law to include surrounding development in its request for state money.

 

The IGFA requested $1 million a year for 14 years, and an initial lump-sum payment of $1 million, to build a headquarters and museum in Dania Beach.

 

Considering annual attendance of about 100,000 and an admission price of $6 a person, its ability to raise $1 million a year based on the state sales tax of 6 cents on the dollar was questionable. But in the IGFA's case, legislators included nearby "improvements by private sector concerns" into their law.

 

The statute never spells it out, but those improvements meant Bass Pro Shops, which built a store next to the museum. With Bass Pro Shops' ability to draw about 3 million customers a year, the overall project easily reached the $1 million sales-tax threshold.

 

"It was a big deal to persuade them to come to Florida," Pendleton said of Bass.

 

But was the $1 million even necessary to lure Bass Pro Shops to Florida?

 

Florida was always an ideal market for the outdoor megastore, said Admin Whiteley, manager of corporate public relations for the chain. In fact, since Bass Pro Shops opened its first Florida store in Dania Beach in 1998, it has opened three more around the state, and just last week announced plans to open a fifth in Miami.

 

The state has been providing subsidies ? or as it inaccurately calls them, tax rebates ? to sports facilities since 1993, when it set aside $2 million a year for H. Wayne Huizenga to renovate Joe Robbie Stadium (now Dolphins Stadium) so the Florida Marlins, a team Huizenga owned, could play there.

 

The original intent of the law was to attract professional sports teams to the state, but it has been rewritten to keep teams here as well.

 

Currently, 14 professional sports facilities are receiving more than a half-billion dollars in the subsidies over a period of 37 years.

 

And this year ? when critical programs such as Medicaid are facing reductions and legislators are discussing tax cuts that run into the hundreds of millions of dollars ? eight additional sports facilities are seeking more than $235 million during the next 30 years.

 

"We've got people coming up to Tallahassee from all over the state in wheelchairs, with oxygen tanks, begging for funding every year for programs like Medically Needy," said social-services advocate Karen Woodall, referring to a program that provides care for poor people with serious and costly medical problems. "But I've never seen one of these (sports) franchises stand up and explain in public why they need $2 million a year."

 

Such critics say the sports-facilities program is too heavily skewed in favor of the sports franchises from the moment they apply for state money.

 

The group that the state Office of Trade, Tourism and Economic Development has chosen to screen the applications is the Florida Sports Foundation, a private company whose purpose is to promote and develop sports franchises in the state.

 

The foundation, whose board of directors includes all owners of professional teams in the state, also has one of three votes required to give final approval to facilities receiving subsidies.

 

Pendleton, the foundation's president and CEO, is not shy about admitting where the priorities lie.

 

"We work for the state of Florida, but we also represent the sports industry," Pendleton said. "We've got to be neutral, and we've got to advise on both sides. Do we have our own personal views about this? Sure we do."

 

Subsidies don't change

 

Key to each application is an economic analysis that a facility must provide to show it will generate enough in sales-tax revenue to equal the amount of subsidy it seeks.

 

The analyses are supposed to be done by independent parties, but the numbers in several appear to be either out of context ? as is the case for the golf hall of fame ? or inflated.

 

The NHL's Tampa Bay Lightning, in its application, projected an average attendance of 17,488 fans per game, which would enable it to produce at least $2 million a year in sales-tax revenue.

 

To get that number, the group that performed the projections included non-hockey events ? "other sports, family shows, concerts."

 

When estimating the actual hockey attendance, the group said, "Many residents of Florida are recent migrates from states which have NHL franchises. From 1985 to 1990, 56.1 percent of the total migration to Florida from other U.S. states came from the 11 states with NHL franchises. This indicates many Florida residents are potential hockey fans."

 

For its first few years of existence, when expansion teams often enjoy a novelty status and thus draw big crowds, the Lightning exceeded its projections.

 

Then came a seven-year stretch when the team did not reach the projected average ? falling to as low as 11,511 fans per game in 1999 ? until it surpassed it again last year as it won the Stanley Cup.

 

But this year, with the NHL season canceled, the attendance will be zero.

 

Yet nothing will happen to the subsidy going to the owners of the Lightning's arena.

 

That's because the state uses the economic analysis to determine how much it will pay a sports franchise or venue owner. Once that number is set, it doesn't change, even if the team makes far less than what it projected in sales tax. That's why it is a subsidy rather than a tax rebate, as state officials often call it.

 

Similarly, the Florida Marlins have failed to meet their attendance projections at Dolphins Stadium.

 

An analysis filed by that stadium said the Marlins would bring in 2.5 million fans during their inaugural year and 2.1 million in following years. The team made its first-year mark but since has surpassed 2.1 million fans only once, when it won the World Series in 1997.

 

The yearly attendance has been far below the estimate, falling as low as 813,111 in 2002.

 

Yet the owners of the Lightning's arena and the Marlins' stadium continue to receive monthly checks of $166,667 from the state.

 

The state's sports-facility laws also do not require the state to audit the facilities to ensure they are generating as much tax revenue as they said they would.

 

While the Department of Revenue often audits several of the teams for other reasons, it cannot withhold subsidies when it finds problems.

 

"If those good-faith and independent analyses turn out to be wrong, they still get the distribution," Department of Revenue spokesman Dave Bruns said.

 

The department once tried to hold back payments, saying Huizenga was not using all of the money for its intended purpose of renovating the Miami Dolphins' stadium for use by the Florida Marlins.

 

Huizenga sued the state. After legislators changed the law to say the money could be used for other improvements without additional certification, the suit was dismissed and the payments continued.

 

The way most facilities handle the subsidy also makes it nearly impossible for the state to cut off the money. Most facilities qualifying for the subsidy use the promise of the annual payment to get a large-sum, long-term bond to pay for their renovations or construction costs.

 

For example, a facility that is promised $60 million from the state over 30 years could contract for a bond of about that amount in the first year that it then would repay with interest over the long term.

 

That practice nearly caused a major glitch when the Tampa Bay Lightning secured its subsidy.

 

At the time, a private group called Tampa Coliseum Inc. was going to build an arena on city-owned land to house the Lightning, Pendleton said.

 

But the Lightning and Tampa Coliseum Inc. parted ways about the time the state money was to start coming in, and the state had to rush to court to void the Lightning's certification, Pendleton said.

 

Had the state not voided the certification in time, Tampa Coliseum Inc. could have used it to immediately get a bond, which would have mired the state in a legal battle to try to recoup the money.

 

The Lightning later was recertified with a new group, which built its arena.

 

"We still got it caught," Pendleton said.

 

State leaders weigh in

 

The state's three top leaders have spoken this year in increasingly skeptical terms about the latest group of facilities requesting the subsidy.

 

Gov. Jeb Bush has said he questions giving money to already-rich owners.

 

Senate President Tom Lee, R-Brandon, has called the Marlins "terrorists" for hinting they might move to Las Vegas if the state did not approve their funding.

 

House Speaker Allan Bense, R-Panama City, has said, "At some point, you begin to glaze over."

 

And there is at least one lawmaker who wants to eliminate the program. Rep. Susan Bucher, D-Royal Palm Beach, has filed a bill that would transfer all money now going to the sports subsidies to health-care needs in the state.

 

"During this time that we seem to be cutting everything, I would hope that we focus on our core responsibilities," she said. "And I really don't think that a fishing museum is one of them."

 

Woodall agrees.

 

"There's a matter of priorities," Woodall said. "If Florida was able to meet all the critical needs of its residents ? education, smaller classrooms, health care ? then one might have a stab at justifying giving a golf hall of fame a payout every year. But we're not doing that."

 

But support among many legislators remains strong.

 

Last week, Rep. Nancy Detert, R-Venice, used the entirety of her Tourism Committee's meeting to explain the benefits of the program and to "overcome the public perception that we're paying for sports teams."

 

A Florida State professor explained the economic benefits and stature that the teams bring to Florida cities. And as a NASCAR race car sat outside the Capitol building, representatives from cities vying for the subsidy ? including Daytona Beach, Miami, Orlando and several spring training sites ? told the tourism committee about the economic windfall that the improvements to the facilities would bring in.

 

Even before the meeting, Sen. Skip Campbell, D-Tamarac, who supports giving the Marlins a second subsidy, said, "I'm not one of these guys that likes giving money away, but I'm also a realist in looking at the total picture.

 

"Could that money be used for education? Sure it could. It's a lot of money. But when you get the grand picture, it probably will produce more money in the long run."

 

http://www.palmbeachpost.com/news/content/...ports_0327.html

What most of the opponents fail to realize is that in most cases these subsidies actually increase revenue. Sure it's easy to say the dollars should be spent on this or that. But you can't spend what isn't generated in the first place.