SBD/April 12, 2013/Franchises

Documents Reveal Dolphins Could Have $14M Loss Next Season Amid Debt, Renovations

Sun Life Stadium could receive taxpayer subsidies if the referendum passes
The Dolphins “reported earning about $25 million a year in operating profits in recent years, but debt payments and other costs tied to Sun Life Stadium led to a series of recorded losses and slim profits,” according to Douglas Hanks of the MIAMI HERALD. The Miami-Dade County mayor’s office on Tuesday released documents that revealed that the team “predicts a rough year for the bottom line: An operating profit of $25 million last year is projected to swing a $14 million loss by the spring of 2014.” That would be the “lone operating loss in owner Stephen Ross’ tenure, but overall cash losses are projected to approach $70 million by March 2014.” The financial information released also “shows the team receiving about $90 million worth of cash infusions since 2008.” Dolphins CEO Mike Dee said that the money “came from Ross to subsidize losses.” The Dolphins as part of their negotiations with Miami-Dade County for renovations to the stadium “needed to prove to Mayor Carlos Gimenez’s staff that the team itself could not afford a significant renovation without government help.” The numbers “do appear to show the impact" of the Dolphins’ estimated $380M debt, which Forbes reported is the “third-largest in the NFL.” Interest payments hit $17M in the '11-12 season, helping "push net profits to a narrow" $1.8M gain. The next year “swung to an overall loss" of $4.3M. Debt costs “remained about the same but the team recorded a capital expense" of $5M, more than double from the prior year.” The summary also shows $50M in "capital infusions in 2008 and 2009, shortly after Ross paid $1 billion for the team" with then-owner H. Wayne Huizenga. In addition, the summary “shows a projected capital payment by Ross" of $42M this year. Dee said that the money is “to make up for a projected $41 million cash shortfall for the year, brought on by the operating loss” (MIAMI HERALD, 4/11).

ON THE STADIUM FRONT: In Miami, Mazzei & Caputo report the Dolphins “officially launched their political campaign Thursday to persuade voters to approve a tax-subsidized renovation of Sun Life Stadium -- even though the effort might be all for nought.” The May 14 referendum "will take place only if Florida lawmakers pass Dolphins-backed legislation … prospects still in doubt in the tax-averse Legislature.” The Dolphins on Thursday “announced their effort would be headed by businessman and longtime fundraiser Jorge Arrizurieta and lawyer H.T. Smith, both seasoned campaigners who can appeal to two key Miami-Dade constituencies: Hispanics and blacks.” Smith is black, and Arrizurieta is Hispanic. Former President Obama Florida Campaign Spokesperson Eric Jotkoff said that the team “registered its political action committee, named Friends of Miami First, on Thursday afternoon.” Smith and Arrizurieta, who “will be compensated for their work, said it was too early to say how much the PAC plans to spend on the campaign, which will be a month-long dash” (MIAMI HERALD, 4/12). In Miami, Marc Caputo cited sources as saying the effort in the Florida Legislature is anywhere from “struggling” to “limping” to “dead.” But bill backers “dispute this.” Voters only will “have the final say” on the deal if the Legislature approves it (MIAMIHERALD.com, 4/11).
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