ATLANTA - Broward County, Fla., commissioners voted this week to raise an existing hotel tax to build a $212 million bond-financed arena for professional hockey's Florida Panthers.
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The tax on hotel bills in Fort Lauderdale and other Broward cities will increase to 5% from 3% beginning July 1. County officials plan to sell taxable stadium revenue bonds in August, according to finance director Phil Allen. Whether the county will negotiate or privately place bonds remains undecided, he added.
A 20,000-seat arena will be built on 150 acres in the city of Sunrise, which has agreed to contribute some land and $4 million in one-time cash, Allen said.
Broward officials hope to open the arena in time for the National Hockey League's 1998-99 season.
The county has lobbied for months to lure the Panthers north from Miami, where the team plays in the eight-year-old Miami Arena. Professional basketball's Miami Heat was originally included in the protracted negotiations, but last month that team decided to instead pursue negotiations with Dade County for a new building.
Under its financing plan, Broward must kick in $15 million toward debt service each year, according to Allen. The two-percentage-point increase in the hotel tax is expected to generate another $8 million annually.
Some Broward commissioners have questioned the wisdom of relying on what are essentially tourist dollars to fund the proposed arena, since tourism can fluctuate from year to year.
That risk has been mitigated, officials insist, because Panthers owner H. Wayne Huizenga has agreed to cover any shortfall if bed-tax revenues fall below $8 million.
Other anticipated sources of revenue to repay bonds are $5 million annually from arena operations and a $2 million state sales tax rebate.
Broward must issue taxable bonds because more than 10% of debt service would be generated by private activities such as rents and ticket sales.
Hotels in the county endorsed the bed-tax increase, and expect the arena to attract tourists, said Tim Brennan, president of the Broward County Hotel and Motel Association.
"We feel the arena will add to what we're doing in Broward," said Brennan. "It's another reason to come down here."
