Legislative Matter

Miami-Dade Legislative Item
File Number: 141367

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File Number: 141367

File Type: Resolution

Status: Before the Board

Version: 0

Reference:

Control: County Commission

File Name: PERFORMANCE BASED MARQUEE EVENT GRANT AGREEMENT

Introduced: 6/10/2014

Requester: Internal Services

Cost:

Final Action:

Agenda Date: 6/17/2014

Agenda Item Number: 8F2

Notes:

Title:

RESOLUTION AUTHORIZING THE COUNTY MAYOR OR MAYOR'S DESIGNEE TO EXECUTE THE PERFORMANCE-BASED MARQUEE EVENT GRANT AGREEMENT BETWEEN THE COUNTY AND SOUTH FLORIDA STADIUM LLC D/B/A SUN LIFE STADIUM (''SUN LIFE STADIUM'') IN SUBSTANTIALLY THE FORM ATTACHED AND TO EXERCISE THE PROVISIONS CONTAINED THEREIN

Indexes:

SOUTH FLORIDA STADIUM

Sponsors:	Barbara J. Jordan, Prime Sponsor
	Bruno A. Barreiro, Co-Sponsor

Sunset Provision: No

Effective Date:

Expiration Date:

Registered Lobbyist:

None Listed

Legislative History
Acting Body	Date	Agenda Item	Action	Sent To	Due Date	Returned	Pass/Fail

Board of County Commissioners	6/17/2014	8F2	Amended
REPORT:	First Assistant County Attorney Abigail Price-Williams noted Commissioner Barreiro asked to be listed as a co-sponsor to the foregoing proposed resolution. Mayor Carlos Gimenez presented his remarks into the record in support of the Miami Dolphins Performance-Based Grant Agreement (Agreement) designed to help keep the Miami Dolphins as this community’s National Football League franchise for the next 30 years. He pointed out that the agreement ensured that taxpayers were protected and that proposals or deals would not be accomplished at a detriment to the taxpayers of this community. (See Exhibit) Mayor Gimenez stated that this was a “Performance-Based” agreement providing incentives to South Florida Stadium, LLC (Stadium LLC) to host major tourist generating Marquee Events at Sun Life Stadium (SLS). He said that all incentives were performance-based and dependent upon holding major events. Mayor Gimenez indicated that no more than $5 million could be paid annually from Convention Development Tax (CDT) funds, when available. He assured the County Commission that no General Fund monies would ever be at risk. Mayor Gimenez added that this agreement would not impact the Fiscal Year 2013-14 County budget since the first payment would not be made for ten years (2024). Mayor Gimenez reported that SLS needed to be modernized in order to attract major sporting events, which promote tourist-related economic activity, generate media exposure and help brand Miami-Dade County as a national and international hub for sports and entertainment. Under this agreement, MDC will grant Stadium LLC payments based upon the beneficial impact of the qualifying events, said Mayor Gimenez. He further explained the proposed payment schedule, contractual obligations as well as the availability and use of the CDT as a funding source. Mayor Gimenez said he believed that this was the best possible agreement with the Miami Dolphins and urged members of the Commission to support this proposal. He added that the Miami Dolphins would spend over $350 million to renovate the stadium and would continue to pay MDC property taxes. Commissioner Jordan expressed her appreciation to Mayor Gimenez for negotiating this deal, noting she sponsored the foregoing proposed resolution because she believed it was a good agreement for County residents, District 1 and the City of Miami Gardens (Miami Gardens). She pointed out that a renovated SLS would attract future Super Bowls, Bowl Championship Series (BCS), International Soccer tournaments, Pan American Games and other premier sporting and entertainment events. Commissioner Jordan said this agreement would promote jobs and generate an economic impact to the community from individuals visiting South Florida and Miami Gardens for these signature events. She stated that the agreement did not jeopardize the General Fund; that it was a performance-based agreement; that Miami Gardens and the Miami-Dade County Public School (MDCPS) would not be harmed; and that the Miami Dolphins would continue to pay taxes to Miami Gardens, MDC and the MDCPS. Commissioner Jordan commented that aspirational goals were included in the agreement, even though it was not legally permissible to require small business programs to be included in the agreement. She said the Miami Dolphins would pay the County $290,000 for construction and Small Business Enterprise (SBE) monitoring; would use the South Florida Workforce Clearinghouse to recruit workers; would aspire to hire at least 70 percent of the workers from MDC, 20 percent from Community Development Block Grant (CDBG) eligible areas and 10 percent from Miami-Gardens; and would aspire to hire at least 35 percent of its sub-contractors from MDC. Commissioner Jordan added that each bid package would be reviewed by the Small Business Development (SBD) Department for adherence to established goals; that quarterly reports would be provided to SBD; and that a consultant would be hired to assist the Miami Dolphins to achieve these goals. Commissioner Jordan stated that Stadium LLC was Miami Gardens’ largest taxpayer and its largest employer, noting SLS improvements would generate both additional tax revenue and jobs for this community. She concluded that this proposal provided the opportunity for a world class facility and to attract marquee events, noting the economic impact was enormous and this agreement would give tourists a reason to visit Miami-Dade. Commissioner Jordan urged her colleagues to support the Agreement. Mr. Tom Garfinkel, Miami Dolphins President/Chief Executive Officer, 347 Don Shula Drive, Miami Gardens, noted he was joined by Mr. Dan Marino, Mr. Larry Little, Mr. Dick Anderson, Mr. Jason Taylor and Mr. Matt Moore. He said that he heard countless stories about the importance of the Miami Dolphins to residents of this community, their lives and family traditions. Mr. Garfinkel stated the goals were to ensure that the Miami Dolphins would remain in Miami for many years and to bring marquee events to MDC. He explained that a modernized, state of the art stadium was needed in order to attract Super Bowls, World Cup Finals and other world class events. Mr. Garfinkel reiterated that the renovation would be funded without County dollars and every effort would be made to include local and small businesses. He said the Miami Dolphins would not be eligible for any performance-based grant funding if they did not fund construction, pay taxes, keep the Miami Dolphins in Miami for thirty years, and bring marquee events to this community. Mr. Garfinkel explained that meeting the goals would enable the Miami Dolphins to participate in some of the economic upside generated for MDC, with limitations protecting MDC and the CDT. Mr. Garfinkel recognized Mayor Gimenez and Commissioner Jordan for their efforts to craft a fair and innovative arrangement that incentivized the substantial investment that Mr. Stephen Ross, Miami Dolphins Owner, was willing to make in the stadium and this community. Mr. Garfinkel said that Mr. Ross believed very strongly in the future of MDC and this community. He pointed out that Miami-Dade was a cultural mecca for this country, noting a world class facility was needed to attract world class events. In conclusion, Mr. Garfinkel indicated that they were prepared to break ground within a few weeks upon approval of this Agreement and asked for the support of this Commission. Commissioner Jordan noted amendments to the foregoing proposed resolution needed to be read into the record. Assistant County Attorney Gerald Heffernan proceeded to read amendments to the foregoing proposed resolution into the record (See Exhibit entitled Amendments to Marquee Event Performance Based Grant Agreement). It was moved by Commissioner Jordan that the foregoing proposed resolution be adopted as amended as noted by the Assistant County Attorney (See Exhibit entitled Amendments to Marquee Event Performance Based Grant Agreement). This motion was seconded by Commissioner Moss, followed by discussion. Commissioner Bovo inquired whether deferring payments until 2024 would result in a balloon payment at that time. Mayor Gimenez explained that there was an annual payment cap of $5 million and this was the maximum that could be accumulated annually. He said credits beginning in 2016 or the award of a Super Bowl, whichever was later, could be accumulated and the payment would not be due until 2025. Commissioner Bovo questioned whether a $40 million accumulated payment could potentially be owed in 2025. Deputy Mayor Edward Marquez pointed out that the Agreement contained an Initial Phase Cap which provided the potential to earn grants with a maximum initial payment of up to $30 million. He indicated that during the initial phase, every year that the Miami Dolphins earned $5 million, they could get paid for the grants over the following nine years, to the extent that funds were available in the CDT. In response to Commissioner Bovo’s question about what would happen if funds were not available in the CDT, Deputy Mayor Marquez explained that the unpaid amount would roll over to the following year for nine consecutive years and would no longer be due if CDT funds were not available. Mayor Gimenez confirmed that the Miami Dolphins would not get paid if CDT funds were not available and that accumulated unpaid funds from the previous nine years would no longer be owed. Commissioner Bovo questioned the projected exposure after 2024. Mayor Gimenez reported that it was unlikely that the $5 million maximum payment would be awarded annually because The Miami Dolphins would need to be awarded a Super Bowl every year to reach that payment level. He added that $1.5 million was the maximum annual payment for a Tier 2 event, noting this would likely be earned annually and they could not be paid for multiple Tier 2 events in one year. Mayor Gimenez clarified that a Super Bowl, which could occur once every seven years, paid $4 million; that a World Cup Final, which could happen one out of every six years, paid $4 million; that a BCS Championship, which could happen one out of every five years, paid $3 million; and that a BCS Semi-Final, which could happen one out of every three years, paid $2 million. Commissioner Bovo inquired about County exposure when events were held at the SLS. Mayor Gimenez explained that MDC provided in-kind police and fire services. He noted the Super Bowl Committee would also request financial support to host the event. Mayor Gimenez said it was doubtful that a Super Bowl would be awarded without SLS renovations. He indicated that the $4 million grant for a Super Bowl was equivalent to the price of purchasing a 30 second Super Bowl commercial advertisement. Mayor Gimenez observed that the advertising value of a Super Bowl was approximately $80 million, noting the return on the investment was tremendous. He said that a Super Bowl also attracted visitors to the community who shopped in the stores, ate in the restaurants, and lodged in the hotels. Mayor Gimenez pointed out that these events generated additional revenue and exposure to this community. In response to Commissioner Bovo’s question about the dollar amount of in-kind services, Mayor Gimenez noted it varied on the event but he estimated that MDC contributed up to $5 million for a Super Bowl. He pointed out that this payment would be a County obligation in addition to the payments pursuant to this Agreement. Ms. Moon, Director, Office of Management and Budget, clarified that previous payments for in-kind police and fire services ranged between $1 million and $1.5 million and this expense was charged to the appropriate County department providing the services, and not to the General Fund. Commissioner Bovo inquired whether CDT funds were ever used for this purpose and if not, whether it was possible to do so. Ms. Moon responded that CDT funds were not previously used. Assistant County Attorney Geri Bonzon-Keenan indicated that staff would evaluate whether CDT funding would a possible option. Commissioner Bovo commended Mayor Gimenez and the Miami Dolphins for their efforts on this Agreement, noting this was a much better alternative to the previous proposal. He noted, however, that he could not support the foregoing proposed resolution because the community did not support financial assistance being provided to private businesses. Commissioner Bovo mentioned that a thorough discussion was needed on expanding CDT funds to help alleviate transportation concerns in this community. He expressed concern that the Agreement could obligate future County Commissions and possibly result in balloon payments requiring moving money around to meet the outstanding obligation. Commission Bovo reiterated that this was a much better deal for the County; however, he said he believed that the decision should be made by County voters. Mayor Gimenez pointed out that the County was protected inasmuch as payments could only be made from available CDT revenue. Commissioner Heyman expressed concern that the Agreement was restrictive. She noted Super Bowl and BCS game revenue went directly to their respective leagues and not to the team that owned the stadium or to the actual stadium owner. Commissioner Heyman also commented on the positive value of large scale events to the community. She pointed out that there was nothing in the Agreement that would encourage major events or world tour concerts. Commissioner Heyman said that these activities provided a significant amount of local revenue, which added to the CDT, the Tourist Development Tax (TDT), and the Bed Tax. Commissioner Heyman pointed out that there was no incentive for SLS to host additional activities with a limited $5 million annual revenue cap, despite the positive impact of these events to the community. She noted Mr. David Beckham should be encouraged to reconsider using SLS for his new soccer franchise, rather than going to another County. Commissioner Heyman said that the Agreement needed to include additional incentives that would promote increased utilization of the facility. Although the Agreement was exceptional for MDC in its current form, Commissioner Heyman inquired whether the $5 million annual cap could be increased to a $100 million cap and additional revenue generating use be encouraged. Mayor Gimenez explained that the Agreement provided the County Commission some leeway to approve future events that would result in additional annual payments. He noted the CDT was a Board allocation and the Board could approve a payment exceeding the $5 million annual cap if it so desired. Commissioner Heyman said that the Board had some flexibility with the use of CDT funds and that there needed to be a significant benefit to the County to reopen this issue. She inquired whether the Agreement included any mechanism that could measure the increase to the CDT associated with a revenue generating event. Mayor Gimenez noted the County Commission allocated non-contractual appropriations from the CDT every year. He said that the Agreement limited what would happen right now so that the Miami Dolphins could not say they wanted more without requesting additional consideration from the Board. Commissioner Heyman noted she would support the foregoing proposed resolution, because, although it was restrictive, it was fair and she liked the flexibility incorporated into the Agreement. Commissioner Suarez expressed concern that funding was accumulated for the initial $30 million payout after ten years. He stated that it was not a good moment to consider this Agreement, as MDC was facing a $200 million budget shortfall; that the Police Department had a $45 million deficit and needed to eliminate 452 sworn officer positions; and all 26,000 employees were facing a possible ten percent salary reduction. Commissioner Suarez observed that the Miami Dolphins was an exceptional franchise and pointed out that no government funding was used to build the current facility, other than the favorable property lease of $1 per year. Commissioner Suarez noted he concurred with Commissioner Bovo’s comments about the County's future mass transportation needs. He indicated that Florida Statute 212.0305(4)(b) permitted CDT funds to be used to acquire, construct an inter-city light rail transportation system that would connect the largest existing publicly-owned convention center, and the hotels north of the convention center, and to and from the downtown area of the most populous municipality in the County as determined by the County. Commissioner Suarez stated that host cities were also asked by the National Football League (NFL) to provide and pay for a wide variety of additional assistance, including: advertisement, parking, communications, police, automated teller machines, limousines, and other services. For the afore-mentioned reasons, Commissioner Suarez indicated that he was opposed to the foregoing proposed resolution. Commissioner Diaz pointed out that this Agreement was an example of working together to develop solutions and partnerships. He asked whether the intent was to commit CDT funds to this Agreement, and if so, he asked for clarification as to the purpose of CDT funds. Mayor Gimenez confirmed that CDT funding would be used. He explained that those funds were meant for the enhancement of tourist-related activities and could be used for a variety of specific purposes. Assistant County Attorney Geri Bonzon-Keenan indicated that the two-thirds portion of the CDT funds applicable to this Agreement could be used to acquire, construct, extend, enlarge, remodel, repair, improve, plan for, operate, manage or maintain convention centers, stadiums, exhibition halls, arenas, coliseums, auditoriums or golf courses and may also be used to acquire or construct inter-city light rail transportation systems. Commissioner Diaz inquired whether CDT funds could be used to support maintaining the services provided by police officers or other County employees. Mayor Gimenez reiterated that the Agreement would not impact the Fiscal Year 2014-15 budget and therefore the CDT funds would not save any jobs since the initial payment was not due for ten years. He said he did not believe that CDT funding could be used for police services; however, CDT funds could be used for certain eligible services that helped alleviate the General Fund and then police officers and firefighters salaries could be paid from the General Fund. In response to Commissioner Diaz’ question about the economic impact of a Super Bowl to the local community, Mr. Rolando Aedo, Executive Vice President and Chief Marketing Officer, Greater Miami Visitors and Convention Bureau (GMVCB), 701 Brickell Avenue, Suite 2700, Miami, reported that major events provided both a short-term economic impact through hotel activity and a long-term impact associated with the value of promoting the Miami brand and investments into the community. He said that the GMVCB conducted a study of the top 50 most profitable events for the hotel industry going back to 2007, and found that four out of five days as measured by revenue per available room were Super Bowl related. Mr. Aedo pointed out that other local events also provided a significant amount of economic activity generating sales tax, CDT, and TDT revenue. He noted local media impressions from Super Bowls and other major events helped sustain the Miami brand. Mr. Aedo reported that the media value was $80 million for a Super Bowl and $58 million for a BCS Bowl. He added that the overall economic impact associated with a Super Bowl was approximately $330 million, noting this amount did not include the media value. Commissioner Diaz noted he believed the maximum exposure for the first ten years was $30 million and asked for clarification as to whether this was the case. Deputy Mayor Marquez explained that the payout could be $90 million after ten years in the event that a Super Bowl was held every year during that period. Commissioner Diaz said that the Miami Dolphins were contributing $350 million dollars for the SLS renovations. He emphasized that it was the County’s responsibility to work jointly with the Miami Dolphins to bring economic activity and growth to this community. Mr. Aedo indicated that tourism was the leading source of local employment. He added that the Agreement required all major Super Bowl-related activities, including lodging and the media center, to be located within MDC. Commissioner Diaz stated that tourism was a main economic engine for this community, noting a renovated SLS would generate additional tourism and the ability to showcase a world-class city. He pointed out that committing tax dollars to this effort was advisable. Commissioner Diaz said that the Miami Dolphins and SLS were among the County’s largest employers and that moving forward with this proposal would generate additional jobs. He stressed that the Miami Dolphins were not being paid for an event unless produced. Commissioner Diaz inquired whether the payouts could be made more frequently rather than in one lump sum after ten years. He congratulated Mayor Gimenez and the Miami Dolphins for developing this Agreement, noting CDT funding, which was designed for this purpose, would be used rather than tax dollars and the team would continue to pay ad valorem taxes. Mayor Gimenez clarified that the stadium would remain privately owned and would continue to pay property taxes to the County’s General Fund. Commissioner Diaz concluded that he believed there was a lot more to gain than to lose with this Agreement. Commissioner Monestime reported that his constituents asked him to support the foregoing proposed resolution because it included a 35 percent small business participation provision and a 70 percent local employment requirement. He also noted requests made for race-based quotas and asked representatives of Stadium LLC to indicate that they would make a diligent effort to reach out to the Miami-Dade Chamber of Commerce (MDCC) and other local entities. Mr. Gordon Knowles, President and Chief Executive Officer, MDCC indicated support for the proposed Agreement. Commissioner Monestime pointed out that MDC already provided incentives to private investors through the Beacon Council or other sources to create local jobs and this situation should be no different. He said that there were many other locations throughout the world trying to attract the same games being pursued by Stadium LLC, noting this was not a huge amount of money in comparison to investments made by others to attract sporting events. Commissioner Monestime said it appeared that this deal was fairly negotiated, noting most other stadiums did not pay local taxes. He emphasized that this was a fair deal, although he preferred that Stadium LLC invested in the renovations without asking for County assistance. Commissioner Monestime expressed concern over the steps that would be necessary in the event that the small business participation goals were not achieved. Mayor Gimenez indicated that a monitoring component was included in the Agreement. He said that these were aspirational goals; that there was a handshake agreement; and that he believed the Miami Dolphins were honorable people who would honor that agreement. Commissioner Monestime asked a representative of the Miami Dolphins to indicate for the record the efforts that would be made to attract small businesses. Mr. Albert Dotson, Jr., Dotson, Bilzin Sumberg, Attorneys at Law, 1450 Brickell Avenue, 23rd Floor, Miami, reported that the Miami Dolphins voluntarily agreed to hire Ms. Marsha Jackman as a consultant to ensure that all sub-contracting and hiring packages for small businesses were certified by the County as being able to participate. He noted detailed hiring information would be provided to the County in quarterly reports. Mr. Dotson indicated that they were open to suggestions as to the advertisement process and pointed out that the MDCC supported this plan. Commissioner Monestime expressed his confidence in Ms. Jackman and noted he was pleased to learn that Mr. Knowles on behalf of the MDCC supported the proposal. He said he hoped that the project proceeded in good faith and would be delivered as promised. Responding to Commissioner Zapata’s question regarding whether the overall payment was capped at $5 million or was it the earnings, or both, Deputy Mayor Marquez clarified that both the overall payment and the earnings were capped. Commissioner Zapata commended Mayor Gimenez, Mr. Ross and the Miami Dolphins organization over what he believed was a good agreement. He said that he shared Commissioner Bovo’s concerns, noting he considered reimbursement as a rebate. Commissioner Zapata stated that he did not want to encumber future commissions over the manner in which the County spent its CDT funds. He pointed out that major events had an impact on the County budget related to charges for in-kind services. Commissioner Zapata noted he concurred with Commissioner Monestime over the County’s infrastructure issues, and expressed serious concern over the lack of a focused plan to address local needs. He concluded that he was not opposed to the deal itself, but was opposed to the mechanics in which it was financed and would consequently not support the foregoing proposed resolution. Commissioner Moss emphasized that Miami was moving toward becoming a world-class community and world-class communities hosted world-class events and had world-class facilities. He pointed out that the goal was to position the community to attract much sought after national and international world-class events. Commissioner Moss stressed the importance of positioning this community for the future while at the same time assisting the Miami Dolphins. He said this proposal was a very innovative approach which protected Miami Gardens and the MDCPS as well as provided jobs and contracting opportunities. Commissioner Moss indicated that he was happy to hear of Ms. Jackman’s involvement based upon her previous success with Operation 305. He stressed the importance of putting someone in charge of the project who was committed to its implementation because it was in the best interest of the community and the right thing to do. Referring to the Super Bowl that was held in Miami in 2010-2011, Commissioner Moss recalled that the commercials displayed Miami’s skyline for a number of minutes, and pointed out that it was difficult to measure the impact of this promotional exposure value to the County. He commended Mayor Gimenez for this Agreement, noting his support and urged his colleagues to vote in favor of the foregoing proposed resolution. Commissioner Souto noted that activities promoting tourism sustained this community. He stated that this public private partnership agreement, which would bring tourism and economic development to this community, was a good deal. Commissioner Souto said he trusted that Mayor Gimenez negotiated a good agreement for the future of this community. Commissioner Barreiro said that he supported the proposal and believed it to be a good deal, providing the County with many benefits. Commissioner Jordan recalled that a year ago, she met with Mr. Garfinkel who expressed his desire that there would be more community events and festivals at SLS, making it more accessible to the community; noting that this Agreement replicated Mr. Garfinkel’s vision. In response to some of the concerns voiced by her colleagues, Commissioner Jordan said that SLS had already begun hosting more premier events and festivals that were not even part of this Agreement and that there was an aspirational goal that 20 percent of their employees would come from CDBG eligible areas. She pointed out that the Miami Dolphins’ reputation was on the line, and their sincerity regarding this project could not be doubted, noting so far they had always kept their word. Commissioner Jordan indicated that the Miami Dolphins agreed to hire someone knowledgeable about CSBE programs, rules and regulations, as well as to provide staff to monitor progress in achieving those goals. She suggested that employees for this project be identified according to their zip code in order to create jobs in the communities closest to the project. Commissioner Jordan emphasized that the County could be proud of this project; that it was performance based; and that if the Dolphins did not produce they would not get paid. She added that 95 percent of revenue generated for the CDT was from tourists visiting this community and that ad valorem funding or a tax on the residents would not be used in this Agreement. Hearing no further questions or comments, the Commission proceeded to vote on the foregoing proposed resolution, as amended. It was moved by Commissioner Jordan that the foregoing proposed resolution be adopted as amended, as noted by the Assistant County Attorney (See Exhibit entitled Amendments to Marquee Event Performance Based Grant Agreement). This motion was seconded by Commissioner Moss, and upon being put to a vote, passed by a vote of 7-4 (Commissioners Bell, Bovo, Suarez and Zapata voted "No"; Chairwoman Sosa and Commissioner Edmonson were absent). Note: The foregoing resolution was assigned Resolution No. R-560-14.

County Attorney	6/10/2014		Assigned	Gerald T. Heffernan

County Mayor	6/10/2014		Assigned	Ed Marquez		6/10/2014

County Mayor	6/10/2014		Assigned	County Attorney	6/17/2014
REPORT:	ISD - no cmte - Comm. Jordan Sponsor - Attachments: Contract

Legislative Text

TITLE
RESOLUTION AUTHORIZING THE COUNTY MAYOR OR MAYOR'S DESIGNEE TO EXECUTE THE PERFORMANCE-BASED MARQUEE EVENT GRANT AGREEMENT BETWEEN THE COUNTY AND SOUTH FLORIDA STADIUM LLC D/B/A SUN LIFE STADIUM (�SUN LIFE STADIUM�) IN SUBSTANTIALLY THE FORM ATTACHED AND TO EXERCISE THE PROVISIONS CONTAINED THEREIN

BODY
WHEREAS, Sun Life Stadium desires to invest more than $350 million in funding to improve, remodel, upgrade and modernize Sun Life Stadium, a tourist-related facility, which modernization will include certain key components consisting of a rooftop shade canopy, new seating in the lower bowl of the Stadium, HD Lighting, technology updates and renovations to the concourses within the Stadium to enable it to attract and host marquee events that generate substantial tourism, such as National Football League Super Bowl games, World Cup matches, which, but for such an investment, may not come to Miami-Dade County; and
WHEREAS, Sun Life Stadium has also been home to other tourism-generating marquee events, including four BCS National Championship games, WrestleMania XXVIII, the 2010 Pro Bowl, world-class concerts, the International Champions Cup, and international soccer matches involving teams such as F.C. Barcelona, the Brazilian national soccer team, and the Spanish national soccer team; and
WHEREAS, the modernization of Sun Life Stadium serves a public purpose and would be in Miami-Dade County's best interest in promoting tourism, job creation and growing the local economy through the attraction of tourist-oriented marquee events to Miami-Dade County; and
WHEREAS, other states and cities have also recognized the benefits of marquee events and created grant programs to help attract such events and take advantage of the job creation benefits, as well as the hundreds of millions of dollars in local economic and tourism-related benefits that such events are estimated to provide; and
WHEREAS, in order to capitalize on the economic and job creation benefits of hosting marquee events, other states and cities have supported the construction of new facilities and the modernization of existing facilities so as to attract these high-profile marquee events, such as the brand new $1.3 billion Levi's Stadium, home to the San Francisco 49ers, which beat out Miami-Dade County for the award of the Fiftieth Anniversary Super Bowl game, which is scheduled to be played in 2016;and
WHEREAS, eight consecutive Super Bowl bid processes have excluded Sun Life Stadium as a host site due, in part, to the age and current condition of Sun Life Stadium,
NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA, that (a) the modernization of Sun Life Stadium and the attraction of Super Bowls and other economically impactful marquee events (�Marquee Events�) to Miami-Dade County serves the public purpose of job creation, economic development and attracting out-of-town visitors to Miami-Dade County; and (b) the Performance-Based Marquee Event Grant Agreement by and between Miami-Dade County and South Florida Stadium LLC is hereby approved in substantially the form attached, and (c) the Board authorizes the Mayor or Mayor's designee to execute the attached Performance-Based Marquee Event Grant Agreement and to exercise the provisions contained therein.

HEADER
Date:

To: Honorable Chairwoman Rebeca Sosa
and Members, Board of County Commissioners

From: Carlos A. Gimenez
Mayor

Subject: Performance Based Marquee Event Grant Agreement with South Florida Stadium, LLC

STAFF RECOMMENDATION
Recommendation
The proposed Performance Based Marquee Event Grant Agreement incentivizes South Florida Stadium, LLC to take the necessary steps to host major tourist generating events at Sun Life Stadium which greatly benefits our local economy and enhances Miami-Dade County�s brand throughout the nation and the world. To best protect the interest of Miami-Dade County, these incentives are performance based, in other words � no major event, no grant award. Additionally the grants are also capped to a maximum $5 million per year and payable solely from certain Convention Development Tax (CDT) funds. In other words, no General Fund monies will ever be at risk.

Therefore, it is recommended that the Board of County Commissioners (Board) approve the attached resolution, which authorizes the Mayor or the Mayor�s designee to execute a Performance Based Marquee Event Grant Agreement with Miami Dolphins, Ltd. (the Dolphins) and its affiliate, South Florida Stadium, LLC to: (1) incentivize, on a performance basis, the attraction of major tourist generating sporting events to Sun Life Stadium such as the Super Bowl, College Football Championships, etc,. and (2) ensure that the Dolphins continue to play in Miami-Dade County for the next 30 years.

Scope
Although Sun Life Stadium is in Commission District 1, represented by Commissioner Barbara J. Jordan, the impact of the Performance Based Marquee Event Grant Agreement is countywide.

Fiscal Impact/Funding Source
The funding source for the Performance Based Marquee Event Grant Agreement is certain CDT revenues as detailed further below. There is no impact to the County�s General Fund.

Monitoring
The County has no record of negative performance issues with South Florida Stadium, LLC. Jose A. Galan, Real Estate Development Division, Internal Services Department, will be managing this Grant Agreement.

MANAGER'S BACKGROUND
Background
In April 2013 through Resolution R-279-13, the Board approved a Stadium Modification Agreement with the Dolphins organization for the construction of a minimum of $350 million of capital improvements to Sun Life Stadium, which was to be funded by private monies, a State Sales Tax Rebate of up to $3 million for 30 years, and 75 per cent of an annual levy of an additional 1 percent Tourist Development Tax over 30 years. This agreement was not executed as the latter two funding items required State legislative action and local referendum which were not achieved.

The Dolphins firmly believe that Sun Life Stadium needs major modernization in order to continue to attract major sporting events. The stadium is the largest, single-location venue for sporting events and other public gatherings within the County and serves a public purpose. Marquee events such as the Super Bowl or a College Championship Football game, if they are to be held in South Florida, can only be hosted at Sun Life Stadium. These large events spur significant tourist related economic activity, generate exceptional media exposure and help brand Miami-Dade County as a national and international hub for sports and entertainment.
In order to offer a measure of comparative value for the cost of the proposed incentive grants, according to Forbes magazine, this past year, a 30 second commercial aired during the Super Bowl cost the advertiser approximately $4 million not including production costs. The �air time� or �ad equivalency� benefits of any of these events in our community exceed the proposed grant incentives and that is not including the money generated in our economy by visiting tourists.

Major Aspects of the Performance Based Marquee Event Grant Agreement

Incentive Grant Payments
The County will grant Stadium LLC certain payments for the attraction and occurrence of Qualifying Events, described in the table below, at Sun Life Stadium. Grant earnings and payments will be limited to:
a) Grants earned for each contract/fiscal year during the Grant Term, which is a 20 year period starting at the Qualification Date (which is defined as the later of October 1, 2016 or the award of a certain Tier I Events namely a Super Bowl, World Cup or World Cup Semi-Final Game) ;
b) An annual overall payment cap of $5 million;
c) An annual earnings cap of $1.5 million for Tier II events;
d) An overall cap of $30 million for grants earned during the contract period from the Qualification Date through September 30, 2024 (the Initial Phase Earnings Cap);
e) The availability of CDT revenues to make grant payments in any contract/fiscal year (Available Funding) after meeting all of the County�s obligations payable from CDT.

The following chart describes the types of Qualifying Events and the potential of grant award for each type of event.

Qualifying Event Marquee Event Grant Base Amount Tier One Super Bowl $4,000,000.00 World Cup Final $4,000,000.00 College Football Championship Game (or equivalent college football championship game) $3,000,000.00 World Cup Match (non-final) $3,000,000.00 College Semi-Final Game (or equivalent college football non-championship game) $2,000,000.00 Tier Two International soccer match or other sporting event which attract significant tourists to Miami-Dade County with at least 55,000 Paid Tickets distributed $750,000.00

During the Initial Phase (the period from the Qualification Date to September 30. 2024), the County may elect to defer grant payments from Available Funding. This option would allow the County to build up its Convention Development Tax shortfall reserve. The grants earned and payable for such contract/fiscal year during the initial phase may be paid up to nine years following the year in which the grant is earned subject to Available Funding. These payments are limited to (1) an overall cap of $30 million for all grants earned during the Initial Phase; (2) the $5 million annual overall payment cap; and (3) Available Funding. After the Initial Phase, grants earned and payable for contract/fiscal years during the remainder of the Grant Term may be paid up to five years following the year in which the grant is earned and are limited to (1) the $5 million annual payment cap; and (2) Available Funding. After the nine-year and five-year periods, any unpaid portion of the grant is longer due.

Available Funding
The County�s commitment to make grants under this Grant Agreement is limited at all times to Available Funding, which means the amount in any contract/fiscal year equal to the County�s CDT, less Senior CDT Obligations, and any funds on deposit in the County CDT shortfall reserve. Generally speaking, Senior CDT Obligations include payments on bonds supported by CDT revenues such as bonds issued to construct Marlins Stadium, the Performing Arts Center and other cultural facilities; payments under the AmericanAirlines Arena Management and other agreements; payments made to Miami Beach and the City of Miami pursuant to interlocal agreements; and payments in support of the operations of the Cultural Arts Council, Performing Arts Center, Perez Art Museum and other cultural facilities. The full description of what is senior to (i.e. what is provided before) grant payments to Stadium LLC, is shown in Exhibit A to the enclosed agreement under the definition of �Senior CDT Obligations.�

Non-Relocation
As long as both parties are meeting their obligations under the Grant Agreement, the Dolphins cannot relocate outside of Miami-Dade County for the next 30 years.

Super Bowl
Stadium LLC shall ensure that any Super Bowl bids during the Grant Term are conditioned on the participating teams� headquarters, the NFL�s primary operations center, the NFL media center and the NFL Experience (or future equivalent event) all being located in Miami-Dade County, subject to the County�s ability to host such events.

Small Business Enterprise Goals
As a matter of policy, Stadium LLC has agreed to certain Small Business Enterprises (SBEs) goals as follows:
a) Use of South Florida Workforce to recruit workers,
b) Aspirational goals to have at least 70 percent of workers be Miami-Dade County residents, of which 20 percent are from Community Development Block Grant eligible areas, and 10 percent of which are to be Miami Gardens residents, and at least 35 percent of the firms hired as subcontractors be located in Miami-Dade County. If more than 50 percent of the workers hired are from Miami-Dade County, then the percentage of Miami Garden residents hired shall increase proportionally.
c) Payment of certain County expenses incurred for construction measures and SBE monitoring ($225,000), and a building permitting expeditor.

Attachment

______________________________
Edward Marquez
Deputy Mayor