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Marlins Stadium Update No. $563 million (Bond issues)

Miami-Dade County Commissioners approved issuing as much as $563 million in bonds Tuesday to cover the cost of construction of the Marlins’ $515 million ballpark in Little Havana, but not before opponents got another chance to question the financing plan.

Commissioners voted 8-4 with Katy Sorenson, Carlos Gimenez, Sally Heyman and Joe Martinez voting no, just as they did for the ballpark financing plan on March 23. Opponents raised concerns about everything from the size of the bond issues being larger than authorized in the financing plan to having to tap the county’s general fund, if hotel bed taxes are not enough to cover the bond payments.

The team, city or county can still back out of the ballpark agreement by July 1.

Heyman worried about the county’s $4 million exposure if the deal is terminated by June 1 or $7 million if it’s done by July 1. She also wondered how much more the county will have to pay if its bond rating leads to a higher interest rate on the bonds.

“If the rate changes a half a percent, what is that going to cost us on a half a billion dollar series?” Heyman asked. “And then one percent?”

The commission was told the interest rates would be capped at 7.5 percent for non-taxable bonds backed by hotel bed taxes and 6.5 percent for the $50 million general obligation bond. They were also told an extra .01 percent could cost as much as $25 million more.

Martinez and Gimenez raised concerns again about the county using its general fund revenue as a secondary pledge to repay the bonds.

“If you don’t have it, you may have to go to your secondary pledge,” Martinez said. “I’m not opposed to the construction of it, I’m not sure anyone here wants to lose the Marlins, especially if yesterday’s game is an indication of a really good season.”

The Marlins beat the Washington Nationals 12-6 in their home opener at Dolphin Stadium Monday.

What concerns Martinez is the method of financing. “The economy is not what it was. Tourism has slid down quite a bit, the possibility exists,” he said.

County Manager George Burgess, who plans to go to credit agencies this month, said he believes the financing plan is responsible, but the county won’t know what kind of bond rating it will receive until it goes to the market.

“This is not an easy decision and nobody can guarantee anything,” he said.

Gimenez said, “It’s a risk I’m not willing to take. I don’t think it’s prudent for us to proceed with such a volatile funding source.”

Burgess said the team, city and county built in the July 1 termination date as a precaution. He said it was set then in order to ensure enough time for construction of the ballpark, scheduled to open in 2012.

“It allowed us the opportunity to see how the market responds, which is the essential,” Burgess said. “We won’t know until we go to market, and it gives us the opportunity to see more on bed tax performance ... We felt having that safety valve was wise.”

Categories: Florida Marlins (193), Marlins Stadium Updates (112)

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About the author
CRAIG DAVIS In more than 33 years at the Sun Sentinel, Craig Davis has written about a wide variety of sports topics from baseball to yachting, fishing to triathlons, and also worked as a copy editor and page designer. Recently he reported on local sports, including running, swimming, cycling, equestrian and beach volleyball. He enjoys sports as a participant as well as a spectator, is active in the South Florida running scene plays in the curling club at Saveology Iceplex. This blog offers a glimpse at the business side of sports in the interest of enhancing enjoyment of the games and sporting options as a spectator as well as a participant.
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