Marlins' profits came at taxpayer expenseDocuments revealed Marlins owner Jeffrey Loria misled the public to get a new stadium deal. (Doug Benc/Getty Images)
By Jeff Passan, Yahoo! Sports
The swindlers who run the Florida Marlins got exposed Monday. They are as bad as anyone on Wall Street, scheming, misleading and ultimately sticking taxpayers with a multibillion-dollar tab. Corporate fraud is alive and well in Major League Baseball.
A look at the leak of the Marlins’ financial information to Deadspin confirmed the long-held belief that the team takes a healthy chunk of MLB-distributed money for profit. Owner Jeffrey Loria and president David Samson for years have contended the Marlins break even financially, the centerpiece fiscal argument that resulted in local governments gifting them a new stadium that will cost generations of taxpayers an estimated $2.4 billion. They said they had no money to do it alone and intimated they would have to move the team without public assistance.
In fact, documents show, the Marlins could have paid for a significant amount of the new stadium’s construction themselves and still turned an annual operating profit. Instead, they cried poor to con feckless politicians that sold out their constituents.
Somehow a team that listed its operating income as a healthy $37.8 million in 2008 alone swung a deal in which it would pay only $155 million of the $634 million stadium complex. Meanwhile, Miami-Dade County agreed – without the consent of taxpayers – to take $409 million in loans loaded with balloon payments and long grace periods. By 2049, when the debt is due, the county will have paid billions.
Most harrowing is the takeaway that baseball’s biggest welfare case could have funded a much greater portion of the ballpark. In 2009, when the Marlins started spending some of their profits on their portion of the stadium, they still had an operating income of $11.1 million. The team fought to conceal the $48.9 million in profits over the last two years because the revelation would have prompted county commissioners to insist the team provide more funding. Loria, an art dealer with a net worth of hundreds of millions, wouldn’t stand for that. He wanted as much public funding as possible – money that could’ve gone toward education or to save some of the 1,200 jobs the county is cutting this year.
Surely Samson was joking when he called the leak of the Marlins documents and those of five other teams “a crime.” No, the real misdeed occurred when the head of a professional sports franchise misled the public in order to secure money that wasn’t his. When Forbes in 2007 reported the Marlins had the highest operating income in baseball, Samson denied the team profited, saying: “Very often the mistake that’s made is they look at revenue sharing numbers and the team’s payroll and take the difference and see profit without looking at our expenses.”
Well, now we have a look, and it’s clear what happened: The Marlins loaded money into their coffers and held hostage a city afraid of losing a team, then leveraged it into a sweetheart deal like so many teams across baseball during the stadium boom of the last 20 years.
"It's not that teams need new stadiums, either," said Neil deMause, whose book "Field of Schemes" blew the lid off ballpark boondoggles. "They need new revenues. It’s really just a bailout. It would be cheaper to just give the teams the money. But then it would just look like a handout. The stadiums have become part of the business model for teams."
Not nearly enough credit goes to the proliferation of new stadiums for turning the game into a $6 billion-plus business. In case after case, teams built stadiums with a majority of the funding from public sources and today keep nearly all of the profits generated from games. Commissioner Bud Selig traveled city to city, the pied piper of ballparks, urging voters or city councils or whoever held the checkbook to do the right thing. Always left unsaid was his implication: Or else. However idle the threat, it almost always worked.
And it's still working. Even if Miami isn't exactly a baseball town – the Marlins are behind the Dolphins and Heat in popularity – Samson believes the new stadium on the old Orange Bowl site will expand the team’s season-ticket base from around 5,000 to 15,000 or 20,000. If-you-build-it-they-will-come is nothing more than a myth, proven false by Pittsburgh and Washington and Cincinnati.
It matters not how sparkling the new stadium is, though the embellishments on the Marlins' only add to the ridiculousness of the whole project. Guess which of the following is not true:
a. The Marlins procured $5.3 million in funding from the county’s Art in Public Places department and gave $2.5 million of it to pop artist Red Grooms, who will design a piece with pelicans and seagulls and bright colors and abstract shapes and, best of all, animatronic marlins that celebrate home runs.
b. Billy the Marlin will hold nightly karaoke sessions in left field.
c. Behind the catcher will be 58 feet worth of reef-fish-stuffed aquariums built into the backstop.http://sports.yahoo.com/mlb/news;_ylt=AiW2Ihc3dXT.AP5GDgQfQ1Y5nYcB?slug=jp-marlinsfinancials082410