What happens when we assume

The Marlins’ stadium plan depends greatly on certain assumptions regarding hotel tax revenue. Assumptions which may have been far more reasonable before Depression v.2.0:

The financing plan for the proposed Florida Marlins stadium took a potentially severe hit in January, with a 22 percent plunge in the hotel taxes counted on to cover most of Miami-Dade’s portion of the new $639 million ballpark. The decline was double December’s loss and shows that the hotel market deteriorated even after the arrival of South Florida’s prime vacation season. The numbers are the worst since the fallout from 9/11 . . .

. . . Miami-Dade imposes three hotel taxes, and combined they dropped 17 percent in January. That was the worst percentage drop since July 2002. Nearly 60 percent of the county’s contribution would come from two taxes charged at mainland hotels: the professional sports tax and the tourist development tax, both of which dropped 22 percent in January.

Suporters note in the article that the financing for the stadium is over 40 years, and that revenues will inevitably bounce back, but even if that’s true, that still leaves some pretty major deficits early in the life of the stadium. As it stands, the primary stadium supporter quoted in the article — County Manager George Burgess — is calling the plan that was delivered and was supposed to have been voted on less than a month ago a “hypotehtical” plan.

As I said yesterday, everyone in this story — the Miami Herald included — has an agenda they’re pushing, so everybody’s spin on these sorts of developments should probably be met with some skepticism. There can be no denying, however, that the project, as it currently stands, is a mess.

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Jason @ IIATMS
Jason @ IIATMS

The present value of a 22% decline in expected revenues is…?

A: Not good.