Posted February 11, 200916 yr Total Florida Marlins stadium debt is unclear Will debt on a new Marlins stadium cost $500 million -- or $1 billion? The question can't be answered without a financing plan -- which Miami-Dade has yet to release ahead of Friday's crucial votes. Get Adobe Flash player * Latest Marlins stadium renderings Related Content * Comparing new stadiums * Mayor Carlos Alvarez's State of Dade speech hypes stadium WEB VOTE Should the commissioners be allowed to vote on a stadium before the public is shown the financing plan? Yes No Your vote has been counted, thank you for voting. BY DOUGLAS HANKS [email protected] Days before the final votes on a $515 million ballpark, Miami-Dade's top stadium expense remains a mystery: how much it will cost to pay back the construction debt. County Manager George Burgess said Tuesday his staff may not release a repayment plan on $347 million in ballpark bonds until Miami-Dade commissioners meet Friday. Without those details, it's almost impossible to estimate the strain a new Florida Marlins stadium might place on Miami-Dade's budget or how much the ballpark ultimately would cost the county. Miami-Dade would borrow $50 million for the stadium from a previous bond referendum and pledge $297 million in debt to future hotel taxes. The rest would come from the Marlins, with $13 million from Miami. Using past Miami-Dade bond sales as a guide, the pace of paying back hotel bonds for the stadium could swing borrowing costs from as low as $528 million to more than $1.1 billion, according to Miami Herald calculations. Top county administrators have already said hotel taxes do not generate enough revenue to fund the bulk of the stadium debt. They plan to delay paying down the $297 million in hotel-tax bonds until later years, when history suggests tourism will emerge from its current decline and generate record revenue. ''We're looking at making long-term investments with long-term financing and long-term revenue streams,'' Burgess said this week. The county's annual report to bond holders offers a lesson in how repayment schedules can have more impact on borrowing costs than the original debt itself: ? In 1998, Miami-Dade pledged future hotel taxes to $95 million worth of bonds for athletic facilities across the county, including the Key Biscayne tennis complex. The county set up a steady payment plan, reducing the principal each year and keeping annual interest expenses below $6 million. The total cost of the debt is listed at $169 million. That 178 percent increase would translate into a $528 million tab for the stadium's hotel bonds. ? A year earlier, Miami-Dade borrowed $170 million for Miami's new performing arts center and two suburban theaters by selling bonds pegged to hotel taxes. The bonds only cost Miami-Dade $5.8 million a year in interest payments through 2028. After that, the annual interest expense spikes to as high as $55 million. Unless it's repaid early, the total cost on the $170 million debt will be $651 million. Should the borrowing costs of the stadium debt follow a similar arc -- increasing 383 percent from the original amount -- the hotel-tax bonds on the ballpark would cost $1.1 billion to pay back. ''It's not like a regular mortgage where you have principal and interest,'' said Commissioner Carlos Gimenez, a stadium critic. ``I don't think it's responsible.'' The Burgess plan relies on hotel taxes growing enough in later years to compensate for a sharp decline now. This decade saw hotel taxes grow an average of 6 percent, despite steep declines after the 2001 attacks and double-digit improvement during the recovery. They're now falling by the same amount. The stakes are high, since a shortfall would cause havoc with the $94 million in county expenses funded by hotel taxes this year. Museums receive about $4 million, roughly $10 million goes to the Greater Miami tourism bureau and downtown Miami's Adrienne Arsht Performing Arts Center gets almost $8 million a year. Bond holders have first claim on those dollars should hotel taxes fall drastically short. If hotel taxes cannot cover debt payments, bond holders also can dip into the county's sales-tax revenue -- money that goes into the county's general budget. County officials said stadium bond holders will also have a claim to dollars from the county general budget. That's a worst-case scenario Miami-Dade has never faced -- despite past pressure on hotel taxes caused by foreign tourist murders, Hurricane Andrew and 9/11. Stadium backers see past recoveries as a reason not to let the current economic crisis derail the plan. ''We know from our history that we are resilient,'' Mayor Carlos Alvarez said during his State of the County speech Tuesday. ``We have faced worse and have rebounded.'' http://www.miamiherald.com/news/top-storie...ments_Container
February 11, 200916 yr Author Florida Marlins stadium deal among more beneficial to a team BY JACK DOLAN AND CHARLES RABIN [email protected] The Florida Marlins stadium deal coming up for final showdown votes Friday -- where the public would foot 70 percent of the construction bill and share none of the revenue -- would be among the more generous to a team owner this decade, a Miami Herald analysis found. Fourteen Major League stadiums have been built, or begun, since 2000. The average public contribution for construction of those stadiums has been 44 percent, the newspaper found. Under the proposed Miami deal, the Marlins would rank ninth of the 14 in the percentage of construction costs borne by the team, the newspaper found. ''It's probably not the best deal that has ever been worked out between a community and a team,'' Miami-Dade Mayor Carlos Alvarez said after his State of the County speech on Tuesday. But he insisted it's better than most and comes at a time the region is thirsting for a public works jolt, adding: ``At some point, negotiations have to stop.'' The Herald examined public records, reviewed media reports and spoke with city and county officials across the country to create its list, showing: The public paid a higher percentage for construction costs for stadiums in Cincinnati, Pittsburgh and Milwaukee. Taxpayers in Washington and Houston also paid more initially, but will recoup much of their investment through generous revenue sharing with the teams. Team owners are on the hook for a greater share of construction costs in Minneapolis, San Diego, Philadelphia, Detroit, St. Louis, New York -- with stadiums for both the Mets and Yankees -- and San Francisco. The New York stadiums, worth nearly $2 billion, include no upfront public payments -- but the city is investing nearly $400 million in infrastructure surrounding the ballparks. Stadium deals are complex financial transactions that can be difficult to compare. Some involve outright gifts of public land, which can be hard to value, some involve taxpayer-funded infrastructure that benefits the team and the public, and almost all involve varying degrees of low-interest financing subsidized by government agencies. Those factors make it impossible to draw an across the board, apples to apples, comparison of every financial variable. However, the initial stadium construction agreements are generally comparable, typically setting the tone for how generous local governments are going to be to the team over the multidecade life of the deal. The Herald analysis of those deals shows cities that drove the hardest bargains often did so after putting stadium deals to a public vote, or after politicians dismissed threats from team owners to move. Voters in St. Louis refused to finance a stadium for the venerable Cardinals, so team owners raised 88 percent of the construction money themselves, relying on a county loan for the rest. In San Francisco, where voters rejected four ballot measures that would have committed public funds to a new Giants stadium, a local grocery magnate built a spectacular waterfront park with money from Silicon Valley investors and deep-pocketed fans. ''We really would have preferred if the public had taken the risk instead of us,'' said Peter Magowan, who bought the Giants after the failed ballot measures. ``But voters had spoken in unmistakable terms to us a number of times.'' In Miami, the Marlins and local leaders carefully avoided a public referendum by structuring the deal so most of the public money comes from hotel bed taxes paid primarily by tourists. Bob Starky, who consults for Major League Baseball on stadium deals, reviewed the newspaper's findings. ''The most difficult thing to do with these deals is compare them,'' he said. Starky questioned how fair it is to compare the Marlins to large market teams like the Yankees and the Giants, or even smaller market teams with historically high revenues, like the Cardinals. ''They can put more toward the ballpark than Miami, or Minnesota or Pittsburgh,'' Starky said, ``just like some people can afford to buy a bigger house.'' In some cases, teams were willing to put up more of their own money because they own the property adjacent to their new stadiums and would profit from the development of restaurants and shopping. San Diego, Detroit and St. Louis fall into that category, Starky said. Under the proposed Marlins deal, outright public gifts would cover $361 million of the $515 million stadium construction. The Marlins would pay $119 million and get another $35 million loan from the county, to be repaid in escalating annual installments. The Marlins will not have to buy land: The county will host them rent free for 35 years on the site in Little Havana, which is assessed at $16 million by the county appraiser. The county will own the stadium, so the Marlins won't pay property tax. So-called bed taxes will cover $311 million of the total $515 million cost. But revenue from the bed tax has been severely compromised by the global recession, raising questions about whether the county would have to dip into the general fund, which pays for a wide range of services, including police and garbage collection. Public money also paid the estimated $10 million cost of demolishing the Orange Bowl, which had occupied the site, and will cover an estimated $24 million in infrastructure work. Other cities have constructed finances differently. In 2004, the Washington, D.C., council voted to cover all $600 million of construction costs for the Nationals. But, Washington also shares significantly in the team's proceeds. To help cover the city's roughly $35 million annual construction loan payments, the Nationals pay an average rent of $5.5 million a year. The city also collects tax on tickets and merchandise at the stadium; their share came to $12.5 million in 2008. Taxes on businesses and utilities cover the rest of D.C.'s annual loan payment. Marlins President David Samson said up until six months ago, he offered the county the exact same deal that D.C. received. But county officials say they're better off with Marlins owner Jeffrey Loria spending $154 million toward construction costs than creating dedicated revenue sources for the stadium. ''Washington, D.C., is all public money, it's taxes imposed on users of the stadium,'' County Manager George Burgess said. ``We have not created any new tax or fee, or raised any, for the financing.'' Robert A. DuPuy, president of Major League Baseball, said of Loria: ``This is an owner who is reaching in his own pocket in a market that, frankly, is unproven.'' The San Diego Padres opened their new stadium in 2005, built with 67 percent public funds, slightly less than in Miami. As part of the deal, the team owner invested $300 million to help develop the neighborhood surrounding the stadium. There is no such requirement for the Marlins to invest in Little Havana. The city of San Diego is able to pay off its debt with proceeds from other events at the stadium, including concerts, soccer matches and motocross races. The city makes more than $1 million per year through such events, said Tim Moore, the city's ballpark administrator. Under the Marlins' pending deal, all revenue from the first 10 non-baseball events at the stadium each year would go to the team. After that, the county would get half the profits, but the money must be spent on capital improvements at the park -- another benefit to the Marlins. ''Wow, the Marlins negotiated a good deal,'' Moore said. In Milwaukee, emotions are still raw even though the stadium opened eight years ago and the Brewers made the playoffs in 2008. ''You're gonna get ripped off, lookout,'' Wisconsin state Sen. Michael G. Ellis said last week. ``Bud Selig is on the way; hold on to your wallet.'' Selig, now the commissioner of Major League Baseball, owned the Brewers when stadium negotiations began in Milwaukee in the early 1990s. The initial conversations involved Selig paying for his own stadium, said Ellis, who was majority leader of the state Senate during key votes. Through relentless lobbying, ''the worm turned,'' Ellis said, and the public wound up footing 78 percent of the bill. Selig got the site he wanted, in a remote location where the team wouldn't have to compete with other restaurants and businesses. The Miami deal sounds familiar, Ellis said. ``So it's a self-contained unit? They get the revenue and they don't pay property taxes? It's the same modus operandi as they used up here.'' Former Wisconsin Gov. Tommy Thompson, who went on to serve in President George W. Bush's Cabinet, was originally a strong supporter of the Brewers' deal. ''It couldn't have happened without me,'' Thompson said in an interview last week. But as the deal progressed, Thompson soured. The Seligs, he said, ``were going to contribute a lot more money and a lot more support, and they just kept pulling back, all during construction.'' Thompson said if he were a Miami politician, he would not vote until he saw signed, enforceable contracts for every aspect of the deal. He would insist the Marlins prove they have the financial wherewithal to live up to their end of the deal. Contracts for stadium construction and operation are written, but not signed. The Marlins have fought for years to keep their finances private, and so far have not offered public proof they can cover their share of the construction costs. Marlins President Samson said he expects to approach lenders in the next 18 months, and that ''the banks are comfortable today'' with lending money to Major League baseball teams. ''People want to own that paper because they know there are revenue streams that never go away,'' he said. Selig could not be reached for comment. City and county commissioners will cast votes on five separate stadium contracts on Friday, the final votes in the franchise's decade-long quest for a permanent home. Passage could come down to a one-vote swing, as the County Commission must approve two contracts -- for construction and management -- by a 2-1 majority because the Marlins hired contractors without formal bid, requiring a bid waiver. MLB's DuPuy added that the Marlins might be better off somewhere else if a stadium deal can't be hammered out. ''Anyplace is better than Miami without a ballpark,'' DuPuy said. http://www.miamiherald.com/416/story/898914.html
February 11, 200916 yr Author i left message to all reporter that done reporting about ballpark in miami hearld i told them report about good thing that ballpark could bring to city and county not how money is been use wrong way
February 11, 200916 yr The Herald is slanting their coverager big time . It is a shame because it looks they along with the local politicans may have finally pushed the Marlins out the door . Hopefully Martinez changes his mind otherwise bye bye Marlins
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