Post by mikecubs on Oct 16, 2015 14:00:51 GMT -6
Panthers make play for big boost in public funds
Hemorrhaging tens of millions of dollars each year, the Florida Panthers have made a new request for public assistance at the BB&T Center hockey arena.
The complex package of aid they're seeking amounts to $86 million in tourist taxes, which are paid by hotel visitors, and will be publicly debated by county commissioners for the first time Tuesday.
Though public money for sports teams is controversial, county leaders say they have little choice but to sweeten the deal Broward County made with the Panthers in the 1990s. If the team were to leave or file for bankruptcy, county officials say Broward could be on the hook for millions.
"The county doesn't have any real strong alternatives with the current situation,'' Mayor Tim Ryan said. "The analysis is pretty clear. ... It's a reality of a business decision.''
Broward rejected the hockey club's last two requests for more public funds, and hoteliers and coastal cities opposed the diversion of tourist taxes away from beach renourishment and tourism marketing.
But county officials view the new request more favorably, saying it directs public money into the county-owned arena itself, not to the hockey team. The Panthers organization lost $36 million last year, and $27.3 million the year before, according to a county consultant's analysis.
The new deal requires the team to return the county's money should it file bankruptcy or leave. If the team is sold, the county would share in the profits. And if the team and the arena do well, the county would share in the gains.
"It's a direct reinvestment back into our building and we think that adequate protections are there for the county to recoup any of our support in the event something should happen,'' Deputy County Administrator Rob Hernandez said.
Still, the package is larger than the team's $78.4 million request in 2013, which commissioners did not support. A follow-up request in March was too rich to consider, Hernandez said.
The latest proposal is the product of discussions between the Panthers and county staff, with help from private consultants.
"We've had very productive conversations with the county's consultant,'' Panthers Executive Chairman Peter Luukko said in a written statement passed through a spokesman, "and we look forward to the public workshop on Tuesday.''
County Administrator Bertha Henry is recommending that county commissioners move ahead negotiating the changes.
The county owns the hockey arena, across from Sawgrass Mills Mall in Sunrise, but the Florida Panthers play there and operate the arena, under parent company Sunrise Sports and Entertainment.
"It's costly to let them leave and have a building without them,'' Hernandez said, "and it's going to be costly to retain them. ... There's no easy solution.''
A county consultant found the arena would have a difficult time without its anchor sports tenant, and also will require millions in upkeep.
Under the elements of the deal, which would run through 2028, the Panthers would:
•Continue making $5.3 million annual debt payments toward the county's $15.3 million obligation. The county still owes $140.76 million for the 17-year-old's arena construction and adjacent highway ramps.
•Receive $86 million help from the county, or $6.6 million a year average, but in a schedule of front-loaded payments that starts at $12 million a year. Of the total, $39 million must be used for capital expenses at the arena, $45.5 million for operating expenses like paying the electric bill or property insurance, and $1.5 million to lure a "high impact event.''
•Stop paying $500,000 for tourism marketing each year. Instead, the county would get a suite for economic development use, and a prominent "dasher board'' advertisement where the county's logo would be seen at center ice at the visitor's bench when games are broadcast.
•Provide an irrevocable letter of credit to protect the county's financial investment if the team defaults, files bankruptcy or relocates.
•Grant the county development rights on land surrounding the arena, including the 88 acres of parking, where Hernandez said a mixed-use entertainment complex could be considered. Currently, the Panthers have development rights on some acreage and controls development on the rest.
•Share proceeds with the county if the NHL expands between 2015 and 2021 and gives teams expansion proceeds. After the Panthers' losses are covered, the county would get the remainder of the one-time expansion payment.
•Give the county 10 percent of profits if the team, made more valuable by this new deal, were sold.
•Give the county authority to approve where the money for capital projects is spent, and authority to replace the Panthers' Arena Operating Company with another arena manager if needed.
•Share profits with the county, giving 10 percent of gross revenues if they exceed $145 million annually, in the first six years, and $170 million after that. Currently, the numbers are in the negatives. A consultant for the county found that Panthers' losses have steadily grown, and last year hit $36 million.
•Offers a commitment to host an NHL All Star Game before 2022. The NHL also would contribute $1.5 million for youth hockey development in Broward County.
•Allow the Panthers to get out of the contract in eight years if it's not working out. They'd have to give a year's notice, show losses of $100 million over seven years, and pay a termination amount. For example, if the Panthers leave in year 8, they'd pay back the full $72 million the county would have given them by then. The termination penalty decreases each year thereafter but leaves the county with enough money to pay off the debt.
Hernandez said team and NHL representatives are expected at Tuesday's workshop, where a possible increase in the tourist tax also will be discussed. The team was sold in September 2013 to its present owners, Vincent Viola and Doug Cifu.
www.sun-sentinel.com/sports/florida-panthers/fl-florida-panthers-arena-20151014-story.html
Hemorrhaging tens of millions of dollars each year, the Florida Panthers have made a new request for public assistance at the BB&T Center hockey arena.
The complex package of aid they're seeking amounts to $86 million in tourist taxes, which are paid by hotel visitors, and will be publicly debated by county commissioners for the first time Tuesday.
Though public money for sports teams is controversial, county leaders say they have little choice but to sweeten the deal Broward County made with the Panthers in the 1990s. If the team were to leave or file for bankruptcy, county officials say Broward could be on the hook for millions.
"The county doesn't have any real strong alternatives with the current situation,'' Mayor Tim Ryan said. "The analysis is pretty clear. ... It's a reality of a business decision.''
Broward rejected the hockey club's last two requests for more public funds, and hoteliers and coastal cities opposed the diversion of tourist taxes away from beach renourishment and tourism marketing.
But county officials view the new request more favorably, saying it directs public money into the county-owned arena itself, not to the hockey team. The Panthers organization lost $36 million last year, and $27.3 million the year before, according to a county consultant's analysis.
The new deal requires the team to return the county's money should it file bankruptcy or leave. If the team is sold, the county would share in the profits. And if the team and the arena do well, the county would share in the gains.
"It's a direct reinvestment back into our building and we think that adequate protections are there for the county to recoup any of our support in the event something should happen,'' Deputy County Administrator Rob Hernandez said.
Still, the package is larger than the team's $78.4 million request in 2013, which commissioners did not support. A follow-up request in March was too rich to consider, Hernandez said.
The latest proposal is the product of discussions between the Panthers and county staff, with help from private consultants.
"We've had very productive conversations with the county's consultant,'' Panthers Executive Chairman Peter Luukko said in a written statement passed through a spokesman, "and we look forward to the public workshop on Tuesday.''
County Administrator Bertha Henry is recommending that county commissioners move ahead negotiating the changes.
The county owns the hockey arena, across from Sawgrass Mills Mall in Sunrise, but the Florida Panthers play there and operate the arena, under parent company Sunrise Sports and Entertainment.
"It's costly to let them leave and have a building without them,'' Hernandez said, "and it's going to be costly to retain them. ... There's no easy solution.''
A county consultant found the arena would have a difficult time without its anchor sports tenant, and also will require millions in upkeep.
Under the elements of the deal, which would run through 2028, the Panthers would:
•Continue making $5.3 million annual debt payments toward the county's $15.3 million obligation. The county still owes $140.76 million for the 17-year-old's arena construction and adjacent highway ramps.
•Receive $86 million help from the county, or $6.6 million a year average, but in a schedule of front-loaded payments that starts at $12 million a year. Of the total, $39 million must be used for capital expenses at the arena, $45.5 million for operating expenses like paying the electric bill or property insurance, and $1.5 million to lure a "high impact event.''
•Stop paying $500,000 for tourism marketing each year. Instead, the county would get a suite for economic development use, and a prominent "dasher board'' advertisement where the county's logo would be seen at center ice at the visitor's bench when games are broadcast.
•Provide an irrevocable letter of credit to protect the county's financial investment if the team defaults, files bankruptcy or relocates.
•Grant the county development rights on land surrounding the arena, including the 88 acres of parking, where Hernandez said a mixed-use entertainment complex could be considered. Currently, the Panthers have development rights on some acreage and controls development on the rest.
•Share proceeds with the county if the NHL expands between 2015 and 2021 and gives teams expansion proceeds. After the Panthers' losses are covered, the county would get the remainder of the one-time expansion payment.
•Give the county 10 percent of profits if the team, made more valuable by this new deal, were sold.
•Give the county authority to approve where the money for capital projects is spent, and authority to replace the Panthers' Arena Operating Company with another arena manager if needed.
•Share profits with the county, giving 10 percent of gross revenues if they exceed $145 million annually, in the first six years, and $170 million after that. Currently, the numbers are in the negatives. A consultant for the county found that Panthers' losses have steadily grown, and last year hit $36 million.
•Offers a commitment to host an NHL All Star Game before 2022. The NHL also would contribute $1.5 million for youth hockey development in Broward County.
•Allow the Panthers to get out of the contract in eight years if it's not working out. They'd have to give a year's notice, show losses of $100 million over seven years, and pay a termination amount. For example, if the Panthers leave in year 8, they'd pay back the full $72 million the county would have given them by then. The termination penalty decreases each year thereafter but leaves the county with enough money to pay off the debt.
Hernandez said team and NHL representatives are expected at Tuesday's workshop, where a possible increase in the tourist tax also will be discussed. The team was sold in September 2013 to its present owners, Vincent Viola and Doug Cifu.
www.sun-sentinel.com/sports/florida-panthers/fl-florida-panthers-arena-20151014-story.html