HoJo's To Miami Motorsports: No Prix Fee for Thee!

At least in terms of its location, there isn't all that much to recommend the Howard Johnson Port of Miami Hotel. The view across Biscayne Boulevard - Bicentennial Park and the port beyond - isn't bad, but nor is it anything to write home about to the folks back in Paducah. The city's homeless frequent the drab streetscape below. A few blocks south of the hotel with the trademark bright-orange entrance is the new, unremarkable Greyhound-Trailways bus station. Immediately north of the seven-story structure, the perpetual race of Miami Beach traffic takes place along overworked I-395.

Once every year, though, a different sort of race comes to town, and the gods of good fortune smile down on the little Howard Johnson by the bay. During the weekend of February 22, the tenth annual Grand Prix of Miami roars through Bicentennial Park and along Biscayne Boulevard, right in front of the hotel. Management jacks up the rate for a night's stay to $300, imposes a three-night minimum, and without fail, all 100 rooms are booked.

The hotel's $90,000-plus gold mine has not escaped the notice of Grand Prix promoter Ralph Sanchez and his bean counters. Faced each year with a bill for nearly four million dollars and always on the alert for possible sources of revenue, Sanchez recently drafted a letter to Bryan Thompson, the hotel's general manager, practically demanding a cut of the profits: "The Grand Prix is a huge undertaking with costs escalating on an annual basis," wrote Sanchez in his January 6 missive. "In order for us to continue to bring this community events, which will impact the hotel industry as well as the local economy, we must find ways to help subsidize the events. As such, we are going to those businesses that benefit from the Grand Prix in order to help amortize the increasing costs. The Howard Johnson Port of Miami, being a prime beneficiary of the Grand Prix, must step up to the plate and help the event. I believe a fair proposal would be to share with you on an equal basis any increase in revenues that you would enjoy over your standard rates."

With their standard rates currently in the $79 neighborhood, Howard Johnson's management isn't exactly eager to play Good Samaritan to the needy Sanchez. "We're not going to pay additional fees just because we're situated where we're situated," asserts Lenny Stark, area manager for Universal Hotels, which owns the downtown inn and four other Howard Johnson hotels in the Miami area. After consulting with their attorney, Richard Pettigrew, hotel managers decided to make the issue public. "We found ourselves in a position that was untenable and, we felt, very, very wrong. We're attempting to correct the wrong," explains Stark.

Pettigrew drafted a letter of his own, which he had hand-delivered to the office of Miami Mayor Xavier Suarez. "Since Miami Motorsports is a licensee of the city of Miami, I thought that you might be interested in its `fundraising' activities in connection with the Grand Prix," the attorney wrote. "I am sure that the city does not condone such strong-arm tactics on the part of its licensees, and I trust that you will ensure that Miami Motorsports will not undertake any punitive action against the hotel."

Pettigrew, who had reason to anticipate "punitive action" on the part of Ralph Sanchez, enclosed a sworn affidavit signed by Bryan Thompson, in which the hotel manager describes how the promoter and his attorney, Ron Book, had attempted for months to extract a contribution from the Howard Johnson's proprietors.

Thompson's affidavit recounts how in early November, days before the Miami Motorcycle Grand Prix - another Sanchez-staged event - Sanchez and Book, an influential lobbyist before the Florida Legislature in Tallahassee, paid him a visit and requested a percentage of the hiked-up room revenue generated by those races. (The hotel raised its rates to $150 per night for the two-year-old contest, which draws about 30,000 fans, as opposed to upward of 80,000 spectators who attend the annual auto race.) They asked for $30,000. If the money was not immediately forthcoming, Thompson says Sanchez and Book advised him, workers from Miami Motorsports would erect an enormous banner advertising the event's corporate sponsors and blocking the view of Howard Johnson's patrons. (Sanchez says Thompson is mistaken: he didn't go to the meeting at all; he sent Book and another Miami Motorsports official as representatives.)

When Thompson refused to hand over the cash, employees brought a pair of cranes to put up a 60-foot-high banner, but the effort was abandoned at the last minute. Four days after the motorcycle races, however, Thompson received a letter from Robert Wild, vice president of marketing for Miami Motorsports. "Please call me as soon as possible so that we might avoid any embarrassment for your hotel during our event next year," Wild wrote.

Later, according to Thompson's affidavit, during a second meeting on December 30, Sanchez and Wild told Thompson that "Miami Motorsports was having financial problems, and that 1992 was a `make or break' year for the Grand Prix." They said they wanted to resolve the unpleasant situation in a friendly manner. To wit: The hotel was to make a "voluntary contribution" of $40,000 for the auto race. And, they added, if payment wasn't made by February 21, the barrier would go up.

Sanchez, who recalls the December 20 meeting a little differently - he says he has no financial troubles and he set no deadline - followed up the conversation with his January 6 letter. "It would be so nice if these people acted differently," says the promoter, who contends that it's only fair for the hotel to share in the cost of the bonanza. "Every year the race is costing more and more money, and we have to get those people who benefit from the race to help the race out. Every hotel in Dade County we have asked for help has come forward in terms of complimentary rooms, dinners, press conference facilities, cocktail parties, et cetera, et cetera, et cetera, except for the Howard Johnson Port of Miami. Some of the teams stay at the hotel and they have complained about rates going up progressively over the years. What these people are doing is raping our fans, our teams, and our sponsors. It just makes my blood boil."

Well, not exactly every hotel in Dade County. While the Howard Johnson is the only hotel that's actually within the race-car circuit, Sanchez didn't approach management of the nearby Everglades Hotel, on Biscayne Boulevard at Third Street, nor did he seek monetary aid from the Best Western Marina Park Hotel one block to the north. (Neither hotel raises its room rates for the Grand Prix.)

Miami Mayor Suarez isn't in an ideal position to play the role of impartial observer. This year the City of Miami will provide about $220,000 worth of police, fire, and sanitation services for the event. In return, Sanchez says, he expects to pay the city twenty percent of what he estimates will be a net profit of less than one million dollars. Sanchez has also spoken of building a permanent race course to stage the event, and not necessarily at Bicentennial Park. Talk of a move comes, in part, because of a dispute between Sanchez and the city commission over the city's decision to encourage development in a section of the park that now serves as a staging area for the race. Metro-Dade commissioners last month tentatively earmarked nine million dollars for a new racetrack, with funds to be generated by a one-percent hotel tax approved this past year by the Florida Legislature.

After reviewing the Howard Johnson papers, Suarez observes, "If someone happens to be in the right place at the right time with their property rights, I don't know of any law to keep them from profiting from the event. I certainly know what Mr. Sanchez is trying to do, but the economic argument is not convincing. We'll get a legal opinion to see what rights the promoter might have to negotiate participation of hotels in the vicinity. My hunch is he has no rights at all. I also doubt that Mr. Sanchez has done anything illegal. It's not a `strong-arm tactic,' exactly; we probably ought to get an opinion on that."

For now, Thompson's letter to the mayor has prompted Sanchez to reconsider his threat of obstructing sight lines. "They are the ones fanning the flames. The principle is not dollars," insists the promoter, adding that he hasn't yet decided whether the banner will go up. "If they would donate money to the Camillus House or charity, I could accept it. The ripping off of our people continuously is laughing at what we're trying to do. Right now, I don't want their money. Give it to the homeless, for God's sake! But I want to see a check!"

Responds Universal Hotels' manager Lenny Stark: "Mr. Sanchez certainly is entitled to think what he wants, but I don't recall him being on our board of directors to tell us where to put our income.


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