Florida Panthers seeking public funds to offset losses of $20 million
The Florida Panthers are submitting a proposal to Broward County to use public money to alleviate some of the losses the team claims it is suffering.
The Florida Panthers claim they are losing $20 million to $30 million a year while operating out of Broward County's Sunrise, Fla., based BB&T Center. In order to offset those costs, the team hopes to rework its contract with the county in order to collect $70 million in tourism tax revenue to cover the costs the Panthers are paying on their arena.
According to the Sun Sentinel:
The Panthers organization runs Broward's arena in Sunrise, bringing in more money from concerts and other events than from its hockey games, county records show. Financial records show the Panthers make a profit from arena operations. It's the Panthers team that's losing money, [Panthers President Michael] Yormark said.
"This organization has lost between $20 [million] and $30 million on an annual basis,'' Yormark said, "and those dollars have been funded by our owners.''
The deal hinges on the approval of the nine-member Broward County Commission. County officials said they didn't want to rush to a vote. They'll vet the proposal at a workshop in the near future.
The changes have "very significant implications," County Administrator Bertha Henry said, and would require a rewrite of the existing contract.
The arena was built with public funding in 1998 with promises that the taxpayers would see a return of profits, but according to the Sun Sentinel that has happened only once. There is also some dispute that the team is actually losing as much as it says it is, due in part to the fact that the BB&T Center is also a popular concert venue.
In the Panthers' proposal, summarized by the Sun Sentinel, it seems as though there's a lot of give on behalf of Broward County and very little giveback from the Florida Panthers. The only promises appear to be investing in payroll "at a level comparable to the rest of the National Hockey League" and a plan to build a hotel-casino or some other kind of development to increase tax revenue. The team would also repay loans from the county immediately and contribute to the local convention and visitor's bureau.
In return for that, the Panthers get the county to pick up the rest of the tab on repaying the debt on the building, of which the Panthers currently pay $4.5 million annually. The county would also supply funds to the operation of the building and cover part of the insurance on the building if the tab exceeds $1 million.
Whenever a request for public money is made on behalf of a professional sports organization, the next question is what happens if the team doesn't get what it wants. One potential consequence is moving the team, so you better believe people in Seattle and Quebec City are going to be following these developments closely.
That said, Yormark told the paper that he didn't believe new owner Vinnie Viola intends to move the team if he doesn't get his way.
There's still a ways to go in this process, but the proposal has been tossed out there and now the ball is in the Broward County Commission's court, it would seem. As is always the case, playing with taxpayers' money is risky business, especially when that money goes to a for-profit sports organization.
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