The Florida Panthers hockey team won one of the most important contests of its existence Tuesday, when the Broward County Commission agreed to give it $86 million in public funds.
The agreement increases the public investment in the team to $342 million, county officials confirmed.
The vote was 5-3, with Commissioners Mark Bogen, Dale Holness, Barbara Sharief, Tim Ryan and Lois Wexler voting yes. Voting no were Commissioners Chip LaMarca, Beam Furr and Mayor Marty Kiar. Commissioner Stacy Ritter had a conflict of interest and couldn’t vote; her husband lobbies for the team.
“We’re here to stay, we’re here to win a championship. We want to make South Florida proud,” team co-owner Doug Cifu said after the vote. “What the county did today was really double their commitment to the BB&T Center and enable us to put a profesional product on the ice and also bring world-class entertainment to Broward County.”
A majority of commissioners said they were swayed by an analysis that showed the team was bleeding millions, and that if it were to declare bankruptcy or leave, the county could be on the hook for even more than $86 million.
Tuesday’s vote was continued fallout from a deal fashioned in the 1990s for then team-owner H. Wayne Huizenga. The county hoped to share in profits and celebrate a successful team. But the profit-sharing materialized only once, and the team has made it to the playoffs only twice since moving into the new arena from Miami-Dade County. Attendance at the games was the worst in the league last year.
The public has soured on contributing to professional sports teams owned by billionaires. Public input about giving the Panthers more taxpayer money was largely negative over the past few years, though Tuesday, a majority of speakers from the business community supported it.
County commissioners said this deal was an improvement on the team’s past two requests for more money.
“I was handed some lemons, and I’m trying to make lemonade,” said Commissioner Lois Wexler, calling the new contract with the Panthers “as good as it gets.”
Though the team owners said they had no intention of leaving South Florida, one county commissioner noted that two cities, Las Vegas and Quebec, are actively seeking National Hockey League teams.
“This is probably the first time the Broward County Commission is being watched by half of Canada,” Mayor Kiar said as the two-hour hearing began.
The $221.1 million arena was built in Sunrise across from the Sawgrass Mills Mall for the Panthers in 1998, financed with an increase in the tourist tax collected at hotels mostly along the coast. The county, a state sales tax rebate and the Panthers pay the annual debt on it.
Under parent company Sunrise Sports & Entertainment, the Panthers play in the arena and a sister company operates it, hosting national acts like Bruce Springsteen.
The $86 million approved Tuesday will come from tourist taxes.
It’s in addition to $152 million in tourist taxes the county already has contributed, and $104 million the county will contribute between now and 2028 when the contract ends, said Deputy County Administrator Rob Hernandez, the county’s lead negotiator of the deal.
Representatives of the tourism industry cautioned that the deal not hurt beach renourishment efforts or tourism marketing, two other programs the tax is used for.
Commissioner Beam Furr said the tourist tax is supposed to “put heads in beds,” and this spending won’t do that, he said. He also expressed skepticism the county would ever receive a share of profits, and said team co-owner Vincent Viola is a $1.76-billionaire who should “honor the contract.”
“I actually feel like we’ve been cornered into a false choice,” Furr said. “We can either give them the money, or they might declare bankruptcy,”
Tuesday’s vote was the team’s third request in recent years.
In September 2013, Cifu and Viola became the team’s fifth owners. The Panthers were already losing money and asking for $78.4 million from the county, plus development rights around the arena — a request that ultimately fizzled due to lack of commission support.
The team sat silent for months, then in March asked the county for a bailout package so large it was never made public or brought to the County Commission for a vote, Hernandez said. The package amounted to $15 million in aid per year, according to a county analysis, or $195 million through 2028.
The Panthers’ losses have grown in the last several years, according to figures reviewed by the county. According to the county, the Panthers organization lost $36 million last year, and $27 million the year before.
Viola, the new owner, is the executive chairman and founder of Virtu Financial, a high-frequency trading business. He did not attend Tuesday’s meeting. A West Point graduate from Brooklyn, he was named by Forbes as one of America’s 400 wealthiest people.
Under what’s proposed, of the $86 million, the Panthers organization would have to spend $1.5 million drawing a “high impact event,” $39 million on capital improvements at BB&T Center, and $45.5 million on operating costs like the electricity bill. None of the money would go toward the hockey team side of the business.
County Auditor Evan Lukic said an irrevocable letter of credit was a significant improvement to this deal over previous requests. He was critical of the Panthers’ last public request but called this one “plausible.” The letter would ensure the county gets its money if the team files bankruptcy or moves away, he said.
Also, if over a seven-year period, the team racked up $100 million in losses, it would be eligible to leave starting in Year 9, after paying a termination fee. That fee starts at $72 million and decreases each year.
The Panthers lease with Broward was evaluated by Barrett Sports Group LLC. The firm found that the proposal approved by commissioners Tuesday is in the middle of the pack, when compared to 14 other team deals.
The Panthers players were focused on the Ottawa Senators Tuesday night, an Atlantic Division rival sitting three points ahead of them in the playoff race.
But several players and coach Gerald Gallant also had an eye and both ears on the county’s vote. Panthers defenseman Erik Gudbranson is in his fifth season in Florida, part of the team’s youth movement at 23, and wants to be here for a long time.
“As a young guy with the core group of young guys we have here, I feel like we can take it to heart and really create something within this room,” he said. “This vote is absolutely necessary for us to do that. This is where our hearts are. This is where we want to be. We want to create something special here.”
Staff writer Harvey Fialkov contributed to this report.
bwallman@tribune.com or 954-356-4541
