First Stadium Bonds Cost Taxpayers More Than 24 Billion
Written by Risa Polansky on July 9, 2009
By Risa Polansky
A Marlins stadium with an oft-cited price of $515 million to $644 million is to cost taxpayers more than $2.4 billion in debt service over the next 40 years.
Without actual costs in hand — only interest rates — Miami-Dade commissioners agreed to the financing after 1 a.m. last Wednesday.
Later that day, county administrators received debt service numbers from underwriters. Nearly a week later, some commissioners said they hadn’t seen them.
About $91.2 million in convention development tax-backed bonds is to cost almost $1.2 billion in debt service by 2047, J.P. Morgan documents show.
Of that, about $80.8 million goes to the stadium. The rest covers expenses such as debt service reserve deposits, Finance Director Carter Hammer said via e-mail.
About $319.3 million in professional sports tax bonds is to cost $1.3 billion by 2049, Merrill Lynch numbers show.
The total is $328.4 million, including costs to refund old bonds, Mr. Hammer said.
In hitting New York bond markets early last week, county officials couldn’t sell all the bonds within the commission-set 7.5% interest cap.
Professional sports tax bonds sold below the ceiling.
But convention development tax-backed bonds went for nearly 8.2%, yielding proceeds $6.2 million short.
Still to come: sale of $50 million in county general obligation bonds for the stadium.
Commissioners had the option to trigger an easy-out clause built into the stadium deal to avoid financing pitfalls or to right the late-in-the-game curveball by amending their interest-rate cap and accepting a Marlins offer to fill the gap.
The majority voted to keep the stadium alive — without knowing debt service costs.
When asked repeatedly during the meeting, County Manager George Burgess couldn’t say.
As of early Tuesday, commissioners were still unaware of actual costs save those who specifically requested underwriters’ reports.
Commission Chair Dennis Moss, a stadium supporter, said Tuesday morning he hadn’t seen the financing documents and awaited a memo from the manager laying out costs.
Still, he said he’s comfortable.
"The debt service from my perspective is not going to be any different than when we’ve issued bonds before for aviation projects or water and sewer projects," he said. "The number is a big number because we’re financing a large project over a long period of time… It’s like when you finance your house. Your house may cost $500,000, but if you finance over 30 years, at the end of the day you’re going to end up paying $1.5, $2 million."
Stadium opponents Carlos Gimenez and Katy Sorenson — who had seen the actual costs — said the ballpark’s price to the public is too high.
"It’s just very expensive money," Ms. Sorenson said. "And if the Marlins had put in $90 million more, we could have cut the public’s debt in half."
Said Mr. Gimenez, "The debt that we’ve pushed off to future generations… is unconscionable. To actually have to pay back almost $1.2 billion just so we can borrow $80 million to put into a stadium — I’d rather not say what I really think about that because it’s probably unprintable."