Slots Kaput Miamidade Aviation Focuses On Other Moneymaking Ideas
Written by Risa Polansky on January 28, 2010
By Risa Polansky
With a bid for airport slot machines off the table, Miami-Dade Aviation is gambling on a handful of other proposals to generate revenue in the face of soaring annual costs.
Commissioners’ vote last week to quit fighting for a state slots license left a $17 million hole in the aviation department’s plans for fending off the projected $500 million in new annual debt service and operating costs expected to begin in 2015.
Because the department balances its budget by charging airlines fees, it’s crucial to find new ways to bring in money to keep Miami International competitive and avoid hiking charges, aviation Director José Abreu said.
But the slots loss is not a fatal hit to plans for generating revenue, he said — it’s just one idea that didn’t pan out.
"The formula for us is still backwards in terms of the proportion of aeronautical revenues vs. non-aeronautical revenues. The airlines obviously continue to be concerned with what’s going to happen to the landing fees," Mr. Abreu said. "We need to keep looking and exploring alternatives."
But that said, "as we say in the business, you’ve got to know when to fold ‘em."
Commissioners decided last week to nix the slots plan after the state last month shot down Miami-Dade’s application for a quarter-horse racing permit, pre-cursor to a slots license.
They said they didn’t want to spend more time and money on what seems to be a losing game, with legislators plotting to close the loophole that would have allowed for the permit in the first place.
Some feared rubbing Tallahassee lawmakers the wrong way over this issue could hurt the county in other areas.
"I don’t want to get punished because we’re trying to pursue a quarter-horse permit," Commission Chair Dennis Moss said.
Understandable, Mr. Abreu said.
"From my point of view, it was an opportunity to bring $17 million or so a year to this airport and to make us more competitive in the long run, but I’m able to see others’ point of view inclusive of the bigger picture," he said.
And though the department has been knocked off the horse, it’s time to get back in the saddle, he said, and push other "out-of-the-box" ideas.
The aviation department in June proposed nine revenue-generating schemes, slots included.
Now, in addition to continuing to look for ways to save on operating costs, "I think we’re going to concentrate on what’s left" on the original moneymakers list, Mr. Abreu said.
He cited two plans with "great potential": rock mining at Opa-locka West Airport and the department’s three-phase "public-private partnership investment program" to convert vacant land and buildings into revenue-generators.
Long in the works, rock mining at Opa-locka West at US Route 27 and Krome Avenue could add $20 million a year for 19 years, the June memo says.
The county has applied for a mining permit through the US Army Corps of Engineers, but ongoing litigation is stalling approval.
Mr. Abreu said he "feel[s] optimistic," noting that the county’s site "does not have the same concerns" as other would-be mining sites under scrutiny.
Public-private investment ventures are already underway, including pursuing development at Opa-locka Executive Airport, worth a new $7.2 million annually, and working to develop a mixed-use project on three parcels just outside Miami International and a shopping center on two pieces of land at the entrance to Kendall/Tamiami Executive Airport, expected to generate about $3.7 million a year.
Also in the works: a plan to make over the entrance to Miami International to earn the airport money through rent and revenue sharing, projected at about $5 million annually, according to the June memo.
The idea in negotiations now is construction giant Odebrecht’s proposed "Airport City," complete with a Florida International University health care hub.
Another proposal hit turbulence even before the slots bid went kaput.
Mayor Carlos Alvarez in November took drilling for oil at a Miami-Dade County-owned training airport in the Everglades off the table despite its revenue potential, though his spokesman said at the time he’s willing to consider other possibilities.
Mr. Abreu said he’s given the mayor information on the proposal and it’s now in his hands.
It’s not surprising some of the moneymaking schemes are raising questions, the director said.
Mr. Abreu said he expected "all of these would come with some degree of controversy, because if it was easy, somebody would have done it by now."