Destinations

How far will Miami’s hotels and tourism agencies go to land a Super Bowl?

Mar 15, 2013 8:40 am

Skift Take

The Super Bowl is going to boost tourism anywhere, even in as thriving a market at Miami, but skeptical stakeholders are finding the costs it takes to land it might not be worth the results.

— Samantha Shankman

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Bob Brown  / Flickr

The Bills play the Dolphins at Miami Sun Life Stadium. Bob Brown / Flickr


If Miami-Dade raises hotel taxes to land the 50th Super Bowl from the NFL, one group of visitors may not be paying the higher tax: NFL executives.

Among the standard demands from the NFL for communities hosting a Super Bowl is that league employees be exempt from all local taxes. That would free NFL employees from paying an additional 1-percent hotel tax that the Miami Dolphins want for a renovation of Sun Life Stadium — an upgrade the team argues will be crucial if South Florida wants to win the Super Bowl for 2016.

Communities don’t always agree to the exemption — an NFL spokesman said Thursday that South Florida rejected the NFL’s request when Super Bowl last came to Miami Gardens in 2010.

But the region’s rival for the 50th game, Santa Clara, last week announced it would waive hotel taxes for NFL executives. That raises the stakes as the Dolphins lobbying team races to obtain state and county approval of the tax-funded renovation by May 22, when NFL owners will pick a winner.

“It’s pretty mind-boggling what the NFL asks of cities. But they’re a business,” said Dan Beerman a City Hall spokesman in Santa Clara, home to a $1.2 billion stadium under construction for the San Francisco 49ers. “I guess if you’re staying for a few weeks, it adds up.”

Rodney Barreto, head of South Florida’s Super Bowl host committee, said the room-tax exemption will likely come up when the panel meets next week in advance of a May 1 deadline to submit a proposal for the ’16 and ’17 Super Bowls.

The May awarding of the 50th Super Bowl is driving the urgency for Miami-Dade to spend as much as $5 million on a referendum in the next eight weeks, with the Dolphins’ backers arguing South Florida shouldn’t pass up the opportunity to host such a milestone event. But as more of the tourism industry endorses the stadium plan, questions have surfaced about how much the community should sacrifice to host the 50th game.

Late Wednesday, Miami-Dade’s largest hotel group announced its support for raising taxes to upgrade Sun Life as long as some of the new money is shared with the county’s tourism bureau. On Thursday, another Senate committee passed the Dolphins’ bill, which would create a new $3 million state subsidy for Sun Life and allow Miami-Dade voters to approve raising mainland hotel taxes to 7 percent from 6 percent.

Dolphins CEO Mike Dee touted the Senate vote in a statement, noting Super Bowl is one potential gain for a renovated stadium: “The people of Miami-Dade know that moderninzing Sun Life Stadium will create thousands of jobs, pump millions of dollars into our local economy, and help make Miami the hub of soccer in North America.”

In exchange for the renovated stadium, Dolphins owner Stephen Ross has pledged to center future Super Bowls in Miami-Dade — a big switch from 2010, when most official NFL activities occured in Broward. With Miami-Dade leaders slamming that arrangement as they consider giving public money to the Dolphins, Broward is questioning how much to support the ’16 game.

“There is some pushback from my Broward hotels,” said Nicki Grossman, president of the Greater Fort Lauderdale Convention and Visitors Bureau. “They’re tired of reading what they’re reading.”

Broward hotels contribute more rooms to the NFL lodging package than Miami-Dade hotels do, Grossman said, largely because Broward has cheaper hotels that can more easliy provide the discounted rates the NFL demands for Super Bowl. But with backlash over Super Bowl discussions in Miami-Dade, lining up Broward rooms needed for the NFL’s overall request of 19,000 beds has been like “pulling teeth,” Grossman said.

The Fontainebleau, the Intercontinental Miami and other large hotels in Miami-Dade were some of the first supporters of the Dolphins plan, which also won early backing from the Greater Miami Chamber of Commerce. This week’s endorsement by the Greater Miami and the Beaches Hotel Association is the first tourism group to back the proposal, which is significant since many of the GMBHA’s members would pay the higher hotel taxes.

But in debating the matter, some GMBHA board members dismissed the value of a Super Bowl played during the peak of South Florida’s tourism season.

“Many of the directors felt that, even though a Super Bowl is a great asset to the community, it would at best bring marginal growth in revenues due to high occupancies and high [rates] that already exist for that time of the year,” the group’s chairman, Raj Singh, wrote in a March 11 letter to board members. He added the critics saw the “real value” of a renovated Sun Life from new sports and entertainment events that would come in the summer, when hotel rates are down.

One of the weekends the NFL wants reserved for Super Bowl conflicts with the Miami Boat Show, and Miami-Dade’s tourism director has warned it would be impossible to host both events at the same time. Miami Beach commissioners this week passed a resolution opposing the Dolphins’ plan, calling claims of Super Bowl’s economic boost “unsubstantiated.”

On Thursday, GMBHA’s Singh said the Super Bowl skepticism came from a small group of board members, and that most saw the NFL championship as a windfall. Dolphins lobbyists have predicted a $500 million infusion from Super Bowl 50, while academic skeptics say the true boost from a Super Bowl is somewhere between $50 million and $100 million.

Revenue figures show hotel taxes surge when Super Bowl comes to South Florida — up 33 percent in February 2010 and 17 percent in February 2007, when Super Bowl XLI came to Miami Gardens. Spending surges like that have helped the NFL wring concessions from host cities and states throughout the years.

In Florida, state lawmakers passed legislation exempting Super Bowl game tickets from sales tax. (The same law also exempts professional baseball and basketball championships from the tax.) Miami-Dade estimates it spent about $5 million hosting the 2010 Super Bowl, including $1.5 million in cash. Broward contributed $2 million to the game.

A source familiar with NFL requirements provided The Miami Herald with excerpts of the NFL’s Super Bowl requests from recent years. For the 2016 and ’17 games, the NFL added a provision that wasn’t present in language a couple of years before: Not only would the NFL’s employees be exempt from state and local taxes, it wanted rebates on any taxes pased through to the league from local Super Bowl vendors.

The language also specifies the broad range of taxes the NFL doesn’t want to pay: “income, gross receipt, franchise, payroll, sales, use, admission, or occupancy taxes as a result of holding the Game at the site.” That includes parking for Super Bowl events, according to the language. The exemption would cover site visits for up to a year before the game. The Host Committee, NFL and Dolphins have declined to make public the ’16 and ’17 bid package that the NFL delivered to South Florida last year, and governments in Broward and Miami-Dade say they do not have copies.

While NFL spokesman Brian McCarthy said South Florida declined the hotel-tax exemption in 2010, the Host Committee’s Barreto said organizers did not recall the request.

Exempting league employees from Miami-Dade’s hotel tax would amount to a tiny amount of money the county collects from hotels during Super Bowl. But the money is significant enough that the NFL has been asking for it in recent years as cities compete to host Super Bowls. Last week, Santa Clara Mayor Jamie Matthews said the city agreed to the exemption. While it generates about $10 billion a year, the NFL is organized as a non-profit, which shields it from paying federal income taxes.The arrangement has drawn fire from Congressional critics. who cite Commissioner Roger Goodell’s $30 million salary.

The NFL’s McCarthy wrote Thursday that the hotel-tax exemption is one benefit communities can consider offering the league to be “part of the processs to bring a Super Bowl that will generate hundreds of millions in economic impact and exposure.”

(c)2013 The Miami Herald. Distributed by MCT Information Services.

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