Empowerment Trust Considers Support For Marlins Stadium
Written by Paola Iuspa on January 25, 2001
By Paola Iuspa
The private-sector investment bank Miami-Dade Empowerment Trust is to be urged to commit up to $20 million in bond capacity to help finance a downtown baseball stadium by a group of civic leaders wondering how to cover the rest of the cost.
Bryan Finnie, trust president and CEO, said this week he would recommend his board allocate bonds to help build a $385 million stadium for the Florida Marlins.
The trust, which runs on an annual $850,000 budget, has $130 million in bond capacity, Mr. Finnie said. The trust was created to stimulate economic growth in the downtown area, he said.
"Wherever it goes downtown," he said, "the stadium will generate pedestrian traffic and eventually make commercial and residential property values go up. There is no doubt in my mind it will have a long-term economic impact."
He said once a stadium becomes part of downtown, there would be no trouble selling townhouses under construction eight blocks from the proposed performing arts center.
Mr. Finnie said a study would be conducted on the benefits of the stadium before the trust commits to funds.
Financing proposed in a letter of intent between Miami-Dade Mayor Alex Penelas and John Henry, owner of the Marlins, calls for $75 million in bonds, $122 million in state sales tax refunds, $26 million in parking surcharges and $46 million in ticket surcharges. The remaining $119 would come from the county’s convention development tax.
Members of the financing committee of the Community Improvement Authority learned Tuesday from a county attorney that there were several possible sources but no clear-cut choice without obstacles.
Howard Whitaker suggested using bonds secured by the convention development tax and sales tax, an approach used to finance a proposed performing arts center.
Another alternative, he said, would be for the county to pass an ordinance pledging excess convention taxes to secure new bonds but without the backing from the sales tax.
"We don’t know how marketable those bonds will be without backup from sales tax or other county revenue sources," Mr. Whitaker said.
Another option, Mr. Whitaker said, would be to create an interlocal agreement between the Community Improvement Authority and the county, giving the authority the green light to issue bonds, but the authority does not have any source of revenue to back the bonds up.
"It would have to get its revenues from the county," he said.
Mr. Whitaker said a 1% professional sports franchise tax derived from a sales tax could be used but he did not know how much of that tax was available or already pledged to outstanding county bonds.
If the stadium is within a community development agency zone, he said, tax increment revenues would be available. Contributions from the City of Miami would be good, Mr. Whitaker said.
He said funding sources that could generate taxable bonds if they total more than 10% of debt service include $6 million in annual rental for 40 years from the Marlins, a 4% ticket surcharge and city parking surcharges.
Sergio Pereira, a funding committee member for the authority, said until a site is chosen, there could be no financing package.
"Site and funding are related," he said.