Blog Entry

Report: SEC investigating Marlins' stadium deal

Posted on: December 3, 2011 9:29 am
Edited on: December 3, 2011 1:04 pm
 
By C. Trent Rosecrans

The Marlins have been the most aggressive team in wooing free agency and they've been able to do that not only because the team is readying to open a new ballpark, but also because the new stadium was built with a sweetheart of a deal from the city of Miami that has cost the team relatively little. That deal, though, is now being investigated by the SEC -- not the one with Georgia and LSU, but the big one, the U.S. Securities & Exchange Commission.

The Miami Herald reports the SEC has opened what it called a "wide-ranging investigation" into the Marlins' ballpark deal with the city of Miami and Miami-Dade County. The city and county have until Jan. 6 to "deliver everything from minutes of meetings between government leaders and Marlins owner Jeffrey Loria and Major League Baseball Commissioner Bud Selig, to records of Marlins finances dating back to 2007." The SEC also wants documents about stadium parking garages built by the city government.

The city and county are paying for nearly 80 percent of the $634 million stadium. The subpoenas focus, the report says, on the Marlins trying to determine the team's ability to pay for the financing of the stadium. Last year, the Marlins' financial records were leaked and they showed that the team had received the most money in Major League Baseball from its revenue-sharing system, while not investing it back into the team. The team said it was financial strapped and needed help from the city and county to build the stadium, which it ultimately received.

The subpoenas, the report says, say:

"We are trying to determine whether there have been any violations of federal securities laws. The investigation and the subpoena do not mean that we have concluded that Miami-Dade County or anyone else has broken the law."

The city is already under a two-year investigation by the SEC for bond dealings. The newspaper says that case has already cost the city $1.4 million.

The deal with the city for the stadium has been controversial from the start, leading to a court fight in 2009 to stop construction of the stadium and the recall of Miami mayor Carlos Alvarez, a proponent of the stadium.

The stadium is scheduled to be ready for opening day 2012, with the Marlins and Cardinals playing the first game of the season at the new stadium.

Marlins vice president PJ Loyello told the Palm Beach Post's Joe Capozzi that the probe would have "no affect whatsoever on our roster plans," when asked if the investigation could slow the team's pursuit of the top free agents on the market.

The Marlins released this statement on Saturday (via MLB.com):

Yes, we are aware of the investigation that the SEC is conducting on the issuance of the county's and city's stadium and parking bonds. Of course we will fully cooperate with the SEC's investigation as needed and assist in whatever way possible. Because this is an on-going matter, it is not appropriate to comment further.
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Comments

Since: Aug 18, 2006
Posted on: December 3, 2011 8:00 pm
 

Report: SEC investigating Marlins' stadium deal

Also that statement about the City of Miami asking Loria to open the books is completely inaccurate. Paul Braman is the one who asked and he did not have the legal authority to do so which is why his lawsuit got dismissed.

Braman has been targeting the area around the Orange Bowl Stadium for years to build more dealerships, but has been unsuccessful. To me it looks like the SEC is just looking for their cut in the deal along with Paul Braman.



Since: Aug 18, 2006
Posted on: December 3, 2011 7:56 pm
 

Report: SEC investigating Marlins' stadium deal

The Miami Herald is usually 25% accurate on what they report. Lets wait this out and see what is going on, because right now most people involved said they are unaware of being served a subpoena. The interesting thing is Bob DuPuy and Bud Selig are also being probed for any illegal activity. DuPuy is out of baseball and it looks like Selig stepping down is very timely since the Feds are just now looking into his actions as commissioner.



Since: May 18, 2009
Posted on: December 3, 2011 7:52 pm
 

Report: SEC investigating Marlins' stadium deal

The fact that Jeffrey Loria's name is anywhere near a headline that has to do with baseball and financial issue's should be no surprise to anyone. Does MLB do this on purpose? I mean Bud Selig. Does anyone recall the dissaray he left the EXPO's in when he bailed on that club he owned and dumped it on MLB's lap only to be allowed to purchase another team. Put the 2 franchises side by side over the years that Loria has had his money grubbing hands on them and you'll notice several similarities. Before he purchases both, they had impressive young rosters with player's coming into their primes. Not surprisingly, most of them either got traded or walked after their contracts. And consequently, the team's suffered in the Loss column. Then there is the issue of money's coming in, but none going out and back into the Roster itself. The fact that they think they can get Pujols is laughable! Do they really think that Salsa dancing will entice Big Albert to come to South Beach. When was the last time you saw celebrities sit down and watch a Ball game in Miami? Trust me, you could actually see if one showed up because not even the fans(ya I know, what fans) show up. So there goes that appeal. How's that working for the Dolphins? Celebrity owner's...C'Mon MAN!



Since: Aug 24, 2006
Posted on: December 3, 2011 6:32 pm
 

Report: SEC investigating Marlins' stadium deal

Miami asked Loria to open his books when negotiating the stadium costs but he refused.

I say this as a huge baseball fan and I would be disappointed if the Marlins left, but at the point Loria said no, yu can't see the books, the politicans should have 1) gone public and said the Marlins are pleading poverty but won't prove it and 2) told them thank you but no financial records=no stadium deal, and if the Marlins then left, well so be it.  That would have been the prudent fiscal move (not to mention that MLB has said time and time again they will not let baseball leave South Florida, so somebody woud have done something).  Instead, the politicans showed they have no spine or sack and caved.  Maybe the SEC will uncover some nefarious reasons why.  Maybe it will simply prove what many of us already know, which is that South Florida has so many incompetent boobs running the show that we have no hope for a prosperous future.



Since: Sep 25, 2006
Posted on: December 3, 2011 4:51 pm
 

Report: SEC investigating Marlins' stadium deal

Not that I agree with this at all - I'm with you guys. But we are arguing out of both sides of our mouths if we hold some companies up and say, "Nice job!" and then penalize other businesses for doing the same thing. This seems to be a systemic problem much larger than just the Marlins' organization.


Perhaps, though this is an egregious case. 80% tax payer subsidized? That's a complete free lunch/scam. With GE maybe they're getting $5-$10 billion in tax payer goodies. Disgusting as well, but that's a small % of their overall revenue. Plus even though they love offshoring jobs they stil have a 100K or so middle class jobs on the payroll, unlike the Marlins who staff a few dozen spoiled athletes (about 1/3 American),a few paper pushers, and low paid concession workers. But yeah, if you look at the "successful" industries in the US, most if not all are propped up by the governmet, be it defense contractors or the pharmaceuticals. Face it, free trade was a disaster and we can't "compete" against the rest of the world. Time to take the ball home and institute protectionism so we can start working again.



Since: Apr 6, 2009
Posted on: December 3, 2011 4:24 pm
 

Report: SEC investigating Marlins' stadium deal

The Marlins had the highest % profit ratio of any other team in the MLB last year. The city of Miami was furious when this report came out 6 months ago or so. Miami asked Loria to open his books when negotiating the stadium costs but he refused. 



Since: Nov 12, 2011
Posted on: December 3, 2011 4:19 pm
 

Report: SEC investigating Marlins' stadium deal

Shouldn't we be congratulating them on a great business deal? That's business the American way. It's not about what is fair, it isn't about what is just, it isn't about what is good for baseball, the community or the country. It's about profit - profit for the owners and stock holders.

We congratulate GE for making billions on profit when nearly half of their profits is tax payer money - billions of tax payer money - going straight into the pockets of the owners. And we hold them up as the model of business efficiency because they can shelter every dollar they make and not pay a single penny of taxes. So if Miami and Dade County were willing to jump in at the word of the owners and make such a huge financial commitment with taxpayer money because the Marlins are "broke" and they don't do due diligence, as a free market society, shouldn't we congratulate the Marlins' ownership for being good capitalists?

If Major League Baseball will give money to a team with no explicit strings attached or agreements to how that money is being spent and then the money just goest straight into the pockets of the owners, then it is their own fault. It's the same was when the Federal government gives corporations money to create jobs and build new factories but forgets to tell the company that they are supposed to build the new factory and create the jobs in the United States - the government just goes, oops, oh well, while millions go into the pockets of stock holders.

Robert Johnson, former chief economist of the U.S Senate banking committee, says, "America is no longer based on markets and capitalism, instead our economy is designed as 'socialism for the rich' – it is designed to ensure that the wealthiest people take all of the gains, while regular Americans cover any losses."

Isn't that what is going on here? The Marlins' management is wanting to keep all their profits but make the taxpayers in Miami and Dade County foot the bill and take all the risk?

Not that I agree with this at all - I'm with you guys. But we are arguing out of both sides of our mouths if we hold some companies up and say, "Nice job!" and then penalize other businesses for doing the same thing. This seems to be a systemic problem much larger than just the Marlins' organization.



Since: Aug 15, 2006
Posted on: December 3, 2011 3:19 pm
 

Report: SEC investigating Marlins' stadium deal

Miami can thank the likes of the yankees and red sux for the ability to sign every guy out there, revenue sharing at it's finest. Owner gets a ton of cash, pockets it, crys poverty, city builds ballpark, now owner has more money than god....awesome system we have here fella's!!!



Since: Sep 12, 2006
Posted on: December 3, 2011 3:15 pm
 

Report: SEC investigating Marlins' stadium deal

Reyes is a loser ,,,.  ? Please back up your statement with facts.... otherwise.... "...."  



Since: Dec 23, 2007
Posted on: December 3, 2011 2:18 pm
 

Report: SEC investigating Marlins' stadium deal

Bell will be fat and out of shape... just wait... Han Ram is a loser... Reyes is a loser.. so who's next... Albert...


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