More Municipal Madness: Miami on the Hook for Marlins’ Garage Taxes?

Will a seeming lack of municipal due diligence prove costly to Miami taxpayers? Call it lesson No. 3,751 on why you don’t want politicians making business decisions with your money.

When the city of Miami agreed to build parking garages for the new Miami Marlins stadium, borrowing $100 million in the bond market to do so, officials assumed the structures, like most such municipal facilities, would be exempt from property taxes.


That is now looking like a serious miscalculation that could not just upend the city’s financing plan, but allow the Marlins to rake in profits from parking while city taxpayers eat a hefty, and unexpected, tax bill.

The realization hit city officials only recently, as the four garages approach substantial completion — the point at which they would go on the tax rolls. That’s when Miami-Dade property appraiser Pedro Garcia and county attorneys told a flabbergasted Miami Mayor Tomás Regalado during a big pow-wow that they could have a problem.

The gist of it, according to county officials: To be exempt from property taxes, municipal property must be used solely for public purposes.

The city, however, has leased all 5,700 parking spaces in the four garages to the Marlins, at $10 a spot, for every home game and for any other events the team chooses to put on. The team can charge whatever it wants for the parking spots.

Though they caution no final decision has been made, county officials say they believe that means the garages will not function exclusively as a public facility but will work part of the time as a commercial operation controlled by a for-profit enterprise, the Marlins — thus making the structures liable for commercial property taxation.

And that wasn’t even the worst news for the city: It seems the city would also have to foot the tax bill, which Regalado estimates at $1.5 million to $2 million. . . .

A steamed Regalado, who as a city commissioner opposed the stadium project, says the annual tax bill on the garages would not be covered by expected parking revenue and would force the cash-strapped city to dip into its budget.

“That’s going to be huge,” Regalado said. “That really complicates things for us.”

County officials say there’s little they can do about that, calling the tax responsibility a contractual matter to be negotiated between the Marlins and the city.

More here.

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