It’s no surprise that the proposal to obtain public funding for part of a $400 million renovation of the Miami Dolphins football stadium has met with a wave of skepticism. Given how badly Miami-Dade residents were burned by the deal to use tax money to build the Marlins stadium, how could it be otherwise?
In hindsight, that was a rotten deal (which we regret having supported during those flush times) in which residents were duped by management and ignored by a host of public officials.
This is a different deal, with a different and more open attitude by management to get it right. Dolphins owner Stephen Ross has pledged to pay at least $201 million of the $400 million amount — not the 25 percent the Marlins offered.
The county and city entered into the Marlins pact with blinders, without inspecting the team’s books and profits. That was a crucial lack of due diligence. In this instance, Mr. Ross has offered to open up the team’s ledgers, to the extent possible under NFL rules.
The penny hotel-tax increase the team is seeking would raise it to 7 cents on the dollar, bringing in about $10 million a year for the stadium. The penny increase would bring the mainland bed tax into line with the one on Miami Beach, once the Beach’s Convention Center construction gets under way. Still, using the hotel sports tax would require eliminating the current rule that limits the money to publicly owned stadiums. The Dolphins built and own the stadium, though it’s on public land.
There’s a fairness issue, too. While the Marlins and Miami Heat both play in stadiums subsidized by hotel sports taxes, the Dolphins receive no local dollars except for a $2 million sales tax rebate that’s paying off the debt for alterations made to the stadium when the Marlins played there.
Another Dolphins incentive: Management says it will use the lure of a renovated stadium to bring new attractions to the facility, including international soccer.
All of this should be considered. Revulsion over a bad deal should not prevent the consideration of a different proposal that can yield economic benefits for all without risking the public’s money.
No one is suggesting that the county or the Legislature, whose approval will be needed, should rush into any agreement. There are a host of questions that need to be explored before residents of Miami-Dade County can feel that their interests are safeguarded.
To begin with, any cost overruns and the financing arrangement — i.e., issuing bonds — should fall squarely on the Dolphins. That would ensure that county taxpayers are not on the hook for decades for a debt obligation, as they are under the Marlins deal. Also, the sales tax rebate the team is seeking from the state — about $3 million — raises important concerns about going after revenue that (unlike the bed tax) could be used for schools, healthcare and a number of other needs.
And where is Broward County in all of this? Some of its cities are closer to the stadium than South Dade cities. Shouldn’t Broward have some skin in this game?
Ditto for the NFL, which is offering a loan once public financing is secured.
Then there’s the timeline. Mr. Ross says a decision needs to be made right away, in time for the NFL to consider giving Miami the right to host the 50th annual Super Bowl in 2016, a decision expected in May.
Not so fast. Rushing to judgment on such a complicated deal is a bad idea. A later Super Bowl will still be in play.
Finally, there’s the issue of public input. The best way to get a buy-in from the public is to hold a nonbinding referendum once Mayor Carlos Gimenez has negotiated a potential deal with the team. Ideally, the Dolphins would be closer to contributing 75 percent of the cost.
True, public officials are elected to make the tough calls, but it works best when the public supports their decision. And we all know what happens when public officials make decisions that the public doesn’t support — they live to regret it.