Miami-Dade County

July 11, 2014

The LeBron James Era ends. Points to Miami-Dade negotiators for getting deal done with Miami Heat first?

Downtown Miami loses its most famous commuter, as County Hall sees vindication after ending a profit-sharing deal with the Heat.

As they pressed Miami-Dade’s elected leaders for extended subsidies last month, Miami Heat executives had a consistent, unwelcome warning: the LeBron James era won’t last forever.

The message harkened back to the lean years at the county-owned arena, when fans largely stayed home after Shaquille O’Neal left for Phoenix in 2008. Sales broke all records once James arrived from Cleveland in 2010, and Heat negotiators all but promised another rough attendance stretch once they lost their greatest star.

“You can’t just plan for when you’re doing well,” team lobbyist and lawyer Jorge Luis Lopez said Friday, hours after James announced his signing with his hometown team, the Cleveland Cavaliers. “We all knew free agency was coming.”

The end of the LeBron Era presents a complicated reset of Miami’s frenzy over Heat basketball.

Miami-Dade’s new deal extended arena subsidies through 2035, but also ended a profit-sharing deal that might have been a boon to county coffers if James had stuck with the Heat. After four years of crowing over James’ helping fuel Miami’s revival, downtown boosters are no longer able to count the world’s hottest athlete as a commuter.

Miami’s Downtown Development Authority issued a statement Friday that mixed gratitude with a remain-calm message.

“Downtown Miami’s resurgence was well under way before The Big 3 arrived, gained momentum alongside four consecutive championship runs, and won’t be slowing down anytime soon,” DDA director Alyce Robertson said. “LeBron’s decision to take his talents to downtown Miami in 2010 was rocket fuel for our city’s global brand, and we’re grateful for his contributions over the past four years.”

With James out, Miami’s reputation as a fair-weather sports town faces its latest test.

As Marlins Park and Sun Life Stadium struggled with weak attendance, AmericanAirlines Arena stood out as Miami’s lone hub of fan loyalty. Even so, Miami earned a national reputation for fans showing up late and leaving early (and famously being locked out when James foiled what seemed a likely loss in a 2013 finals game).

Throughout Friday, basketball’s center of gravity followed James’ return home. Bloomberg reported that the Cavaliers’ value had instantly doubled to $1 billion. Without basketball’s top star at AmericanAirlines Arena, no one seems to be expecting seats to be as full.

“This town loves winners. It really does,” said Art Noriega, head of Miami’s parking authority and chairman of the sports committee at the Greater Miami Chamber of Commerce “If the fans don’t overreact and show a little patience, and have a little faith that the Heat can rebuild, then I think it will end up being OK.”

In rushing to get a deal with the county signed before the NBA finals concluded, front-office executives hinted that the lack of an agreement would make it harder to keep James. “We have some very big decisions to make in terms of keeping the team intact,” Eric Woolworth, head of business operations, said in May. “Some of that will take us out multiple years. We want to find out what some of our business expenses will be during that time period.”

Central to the deal Mayor Carlos Gimenez secured was a bit of a gamble by Miami-Dade, which accepted a yearly $1 million payment in exchange for ending a profit-sharing arrangement that only began showing promise after James arrived.

The star player’s debut wiped out the past shortfalls that held back profit-sharing during most of the arena’s 14-year history, with Miami-Dade on track to collect $2 million last year before one-time capital expenses wiped out all but $257,134.12 of the county’s share.

With $90 million of recorded arena profits during James’ first three seasons, the Heat had to fend off accusations of seeking government help for an operation awash in cash. Front-office executives and Gimenez countered that they were taking the long-term view toward preserving an NBA team in downtown Miami, and commissioners approved the deal June 3 in a 10-2 vote.

With arena sales sure to take a hit without James, backers of the profit-sharing swap said Miami’s loss also translates into something of a win for the arena agreement.

“I think this vindicates our deal,” said Gimenez spokesman Mike Hernández. “We have a solid million-dollar payment each year from the Miami Heat. “The Miami Heat franchise may see less profitable years as they rebuild.”

In a statement, Gimenez said he had no hard feelings about James so soon after closing the deal.

“I wish him all the best and much luck,” Gimenez wrote. “That is, except when he plays the Heat.”

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