Miami Heat Wants $121 Million in New Taxpayer Subsidies to Stay at American Airlines Arena
A jubilant email landed in the inboxes of Miami Heat season ticketholders yesterday signed by owner Mickey Arison and trumpeting an agreement with Miami-Dade Mayor Carlos Gimenez for a new ten-year deal to keep the team at the American Airlines Arena. "We thank Mayor Gimenez for his vision," Arison crowed. Only problem: Gimenez hadn't actually signed off on the deal yet. That small detail erupted into a bizarre war of words between the two men.
But the real takeaway for residents is this: The Heat front office is expecting taxpayers to pony up for $121 million in new subsidies.
On its surface, the details of the Heat's new proposed lease seem friendlier to taxpayers. For the first time, the Heat would agree to pay a fixed rent to the county, which owns the property. The team would pay the county up to $1.5 million annually to use the arena under the new package.
That would indeed eliminate one of the most absurd parts of the county's current deal with the team.
Back in 1997, the Heat persuaded the county to use a $38 million piece of bayfront property to build a $221 million arena (replacing the Miami Arena, which, never forget, was only eight years old). Their tactic: the time-honored sports franchise tradition of threatening to move away, this time to Broward County. The blackmail worked, and the team got its new digs on the bay.
In exchange, the team was supposed to hand over 40 percent of profits that exceeded $14 million to taxpayers. Guess what? Year after year, Arison claimed that profits never quite passed that benchmark, even after the arrival of the Big Three brought skyrocketing ticket and merchandising sales. (He eventually paid about $300,000 to the county, a piddling figure that earned a rebuke two years ago from the county's inspector general.)
So the fact that the Heat is now ready to pay fixed rent for its lease is great! Except that the team would like that rent to be coupled with a new, $147 million subsidy drawn from hotel taxes. Even with full rent being paid up, that would put a $121 million dent in taxpayers' wallets.
In Arison's letter to fans, he pitches the new subsidies as the only way for the team to put a competitive squad on the floor while keeping the AAA in shape.
"[It] will allow us to continue doing what we've always done: reinvest in the County-owned AmericanAirlines Arena in order to maintain the level of excellence you've come to expect," Arison writes.
But just in case fans didn't get the message, one county commissioner helpfully spelled out to the Miami Herald the consequences of what might happen if they refused: The team, like the Florida Panthers, could pack up for greener grass in Broward. "What's it going to mean if we don't have a guaranteed team here?" Sally Heyman asked the Herald.
Arison's letter claims Gimenez signed on to the new deal and that it will be presented to the county commission May 6. But that now seems unlikely, with Gimenez angrily denying he agreed to the terms and with most of the commission telling the Herald they're skeptical.
Still, expect Arison to return sometime soon with the same playbook: The team can't possibly compete without millions from taxpayers, and if they're not willing to pony up, he'll just have to pick up and take his franchise elsewhere.
Oh, Arison's net worth, in case you're wondering: just shy of $6 billion.
Here's his letter to season ticketholders:
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