Can school system’s soccer stadium play make the grade?
Written by Michael Lewis on October 28, 2015
Miami-Dade’s school system, which teaches decisions based on fact and not emotion, has made itself lead player to create a professional soccer stadium in Little Havana.
That’s great, because if we strip out emotions that put sports on a pinnacle and get down to a factual study of a stadium based on history, economics, public policy and good business practices, the schools have a lot of self-education to do before they commit to anything.
A course outline for this class on acting for the public’s benefit should pose vital questions to see if involvement passes benefits and economics tests in a highly complex deal with moving parts that must function like a fine antique watch, with all gears perfectly synchronized.
Each player is unique:
•The City of Miami, Miami-Dade County and private landowners all own parts of the stadium site and would need reimbursement. What would each receive from whom? Would private land be taken by eminent domain, what would that cost and who would reimburse government for that expense?
•The soccer team doesn’t yet exist and nobody has vetted its financing. When will bodies that must vote on the deal and the public see detailed sources of its money with normal guarantees?
Nobody saw that in the baseball stadium deal next door and government was hoodwinked. Will we this time know all team owners on a percentage basis, the hard assets they hold to carry out their bargain – they don’t yet even own a franchise – and what negotiable instruments public agencies will hold to insure that a start-up can handle its bargain?
•The school system doesn’t play in the development arena. What created a sudden need for a school of sports management and how did it become a priority that could not be met from $1.2 billion that the schools got from bonds?
If the schools need a sports academy, why haven’t they worked with Major League Baseball, which as part of the Marlins stadium deal since 2009 has been offering to build at its expense a high school training academy? The baseball folks did talk about a deal with the schools. Why is soccer’s offer better?
Wouldn’t the baseball stadium next door work just as well for graduations? Why can’t high school bowl games be played there? Remember, the baseball stadium already hosts soccer, football and events.
How much of the operations and maintenance cost of the complex would the schools pay? What is the cost of operating its planned school there and the cost per pupil compared with costs at any other magnet school? Compared with costs per pupil of the system as a whole?
•State authorities oversee tax exemptions. Isn’t making a stadium tax exempt an obvious sham to benefit private owners? How would that play in Tallahassee?
•Miami voters by law must approve a land transfer. How much will be explained to them before the vote, and how impartially, by the city administration?
•Marlins owners by their stadium contract control everything from architecture to operating days and hours of a nearby soccer stadium, even the right to resell every parking space in garages and parking lots that teachers might use. Who would pay them how much to yield control?
Elected leaders seemed unaware of those controls in the 2009 baseball stadium contract until recently. Will they vet all details of a far more complex soccer deal, and then debate them, long before a vote rather than afterward?
•The University of Miami might be a player, using the stadium for football. Under what terms might the university become involved, and when? What would be its financial role and who would receive the university’s payments, government or the soccer team?
Soccer stadium use could be dicey. Who would get non-soccer events revenues, the team or the schools? Who would choose events? Who would control when the schools could use the stadium, and would use be free?
Moreover, would public schools want to be party to some things that happen in and around professional soccer stadiums globally? Fans aren’t called soccer rowdies for nothing. Who would pay to insure the schools against soccer riots?
Whether or not the schools, county and city would pay any direct costs of a stadium, there are indirect costs. A tax exemption would eliminate tax revenues that might pay such indirect costs to taxpayers as increased policing and fire service.
Other indirect costs might include vital infrastructure, include moving or changing streets and roadways, water and sewer service, and road signs. A Community Redevelopment Agency that the city and county would collaborate to create might fund that infrastructure, but the agency functions on tax revenue from the area – revenue to which a tax-exempt stadium would not contribute.
Beyond questions come four firm lessons.
First, a deal this complex is seldom made with a startup with no track record. The last Miami team in this soccer league failed. Those involved need to insure that what they start will be used for three to five decades. A vacant soccer stadium beside an underused ballpark isn’t a pleasing prospect. Marlins attendance is now less than a decade ago, before the glorious new stadium.
Second, a deal this big can’t be done piecemeal. All pieces must be firmly in place with details public before anything is voted on. Remember, county commissioners rushed to sign off on Marlins Park financing in the billions of dollars two days before they were given the price tag. The county manager passed it off as a mix-up. No more mix-ups.
Third, everything needs to be on the table. No after-deal needs. The county last year gave a New York couturier below-market bargain land to create jobs if the company upgraded the site. Now the company wants the county to pay for site work too. Any deal should be final, not a work in progress.
Fourth, what’s the rush? Miami’s mayor says if a deal isn’t hustled through the city will pay $2 million extra for an election. But if it is hustled through, you can bet it will cost us a lot more than $2 million extra.
A rush in a public-private deal always benefits the private side, never the taxpayer. Take your time, vet it well and make every detail public far in advance of a vote. If we learned nothing else from the Marlins stadium, we know that the extra cost of hurrying was billions, not millions.
Once they answer these questions, the school system and all involved will be satisfied either that this deal is great so move ahead, or that the public should say a polite “thanks but no thanks.”
After all, if the soccer owners have money enough to make this deal work for everyone, they have enough to buy private land and do it all by themselves. Just think of the saving of not having to build a school.
The best lesson our school system can teach its students is that the system was not afraid to answer all the questions fully before grading a soccer deal as either an A or an F.