Marlins about to bring ballpark deal in from the bullpen
By Michael Lewis
The people controlling Miami's future — the operators of Major League Baseball — no longer insist on a new stadium downtown and now will accept one at the Orange Bowl site. Whoopee.
Of course, we'll have to yield the city's land, tear down the historic bowl, throw in more than three quarters of a billion taxpayer dollars and perhaps buy up surrounding property with public funds.
But that's a small price to bail big-time baseball out of a bad investment, because the Florida Marlins' operators still owe the league, which is run by all team owners, part of what they had to spend to buy the franchise.
A ballpark built at taxpayer expense would turn the franchise to gold, allow owners to flip the team at vast profit — consider their low investment — and let them pay their debt to fellow owners.
Building a ballpark could make stars of city and county officials. It would only be in the future that the economic cloud over a stadium deal would burst, and by then officeholders would have moved on.
The deal would also let governments dispense cash that might otherwise go to far more vital but far less visible uses. Nobody wants to simply cut taxes when spending is so much sexier.
Yes, all at the table would benefit: officials of Miami-Dade County and the City of Miami, the Florida Marlins and Major League Baseball. Only the taxpayers, who aren't represented in the secret talks, stand to lose.
As a stand-in for those forgotten stakeholders, let's raise questions they might pose as governments give away the store to a business whose uniformed employees average $2.7 million for playing a kids' game six months.
First, is this the site's best use? Can the Orange Bowl have value after the University of Miami shifts its football games to a stadium where the Marlins now play baseball? Why pay to tear down one stadium in order to build another in the same spot? And, if the bowl must go, is another stadium the best use of that city land?
Even if a ballpark were the best use for the site, would it be the best use of scarce public funds? A stadium will cost about $800 million, including interest. As local governments' taxes are being cut, with another huge slash likely after a January constitutional vote, cash is going to dry up. Aren't there more pressing needs?
What would happen to bonds if ballpark revenues were too low to repay them? Planning has been based on 2 million yearly ticket sales. But the Marlins draw less than half that in a stadium with easy access and ample parking. Would sales more than double in a cramped neighborhood? Or would taxpayers have to pay the shortfall?
Is a ballpark best for the neighborhood? Would green space serve better? Or should the city sell the site, then use proceeds to reduce taxes while allowing private enterprise to build a job-generating project there that's more vital to the neighbors?
Is a stadium best for the entire county? If government is hell-bent on building something somewhere, could the money go to museums or social service? Is baseball the best and highest use of land and money?
Is a stadium a good investment? It wouldn't generate jobs — they'd shift from Dolphin Stadium. It wouldn't generate tourism — studies show baseball generates few visitors. It probably wouldn't generate much surrounding private development, either.
Is a half-billion-dollar ballpark plus about $300 million in interest and valuable city land the best price? Could you buy and enclose Dolphin Stadium for far less?
Is the location best? The fallow Miami Arena downtown has transportation galore and a larger audience nearby, plus room for parking. But someone would have to buy that land, and governments always seek a free site, even if it's the worst one — think Performing Arts Center, with a federal highway running smack between the two concert halls.
What about parking? Who would build how much at the Orange Bowl, funded by whom?
What's the real cost, and is government willing to put in that much? The state has been reluctant to fund $60 million that was its ticket to play. We have no idea how much the city and county are being asked for, because the dealing is behind closed doors.
Whatever that cost, and assuming government wants to subsidize a business by $800 million or more, is this a smart way to spend the money? At 2 million annual attendance, the subsidy would be $13.50 per fan per game for 81 games a year. Why not just pay the Marlins $10 in tax money for every ticket they sell in a privately-built stadium — like Dolphin Stadium? It would save money and the bowl site, too.
Where will the team get its meager contribution? It was last pegged at $45 million, or just over 5% of the total cost, excluding land. The team can't even repay its own mortgage.
If the Marlins are to manage construction and cover any cost overruns, as they've proposed, how would they cover overruns if they have no money? Wouldn't taxpayers be on the hook, a la Performing Arts Center? It's bad enough to tap taxes for the public's overruns, but why do so for a private business when it misses budget?
Would you trust a baseball team that can't build ticket sales or a winning record on the field to suddenly learn how to build a stadium? The Marlins can hire experts, but that costs money and assumes they know who to hire. They didn't know who to hire to market their tickets.
In fact, would you trust this ownership in any contract? You haven't been able to trust them to keep a team together after winning two championships. A contract is a legal agreement, but it's only as good as the people who sign it.
If public bodies who have to kick in three quarters of a billion do get involved, what do they get back other than free tickets for officeholders? If the public is going to invest seven or eight times as much as Marlins owners have, shouldn't the public become majority owners? That way, when the team is sold after a stadium deal is cut — as it almost surely would be — the public would share fairly in all the profits, not just the increase in team value.
What solid guarantees would the public get? Would owners pay players enough to be competitive and keep stars instead of trading them to cut costs?
If the team decided in five years to move to Las Vegas, who would pay off the stadium bonds? If Major League Baseball were to implode over $25 million and $50 million player contracts, where would taxpayers be? We'd be paying for decades on a vacant stadium — think Miami Arena here.
Would the stadium deal be like AmericanAirlines Arena? There, taxpayers were pledged profits that have never come, leaving the county without a single dollar in return.
Answering these questions might be easier if the deal that has been crafted over many months in secret were to be public.
Instead, undoubtedly to ward off just such questions, public business is being done in private. We'll see the final form in writing, with meaningful changes no longer possible, shortly before city and county commissioners get a contract crammed down their throats on some trumped-up deadline like the ones we've faced before from Major League Baseball.
Which brings up a final question:
Is this the right undertaking? Should government spend three quarters of a billion dollars to retain any business that employs a few highly paid people who contribute little to local economic growth?
Or should the Marlins just strike out on their own?