Miami Heat Getting a Free Ride From Miami-Dade, County Inspector General Finds
Heat officials are disputing Mazzella's assertion and most of the findings in his report, which takes county administrators to task for not keeping tabs on the arena's annual budgets, projections, and financial statements submitted to the county by Heat management.
While the inspector general did not turn up any fraud by the Heat, Mazzella concluded that a "number of questionable expenses were charged against arena revenues, thus lessening the county's prospects of receiving its proportional share of arena profits."
His nine-month investigation followed a New Times report that despite getting $72 million in taxpayer subsidies to run the Triple A and raking in a fortune since LeBron James and Chris Bosh joined the franchise, the Heat has avoided sharing any revenue with the county.
Mazzella essentially says no one at the county, particularly the mayor's office, understands how the agreement with the Heat is supposed to work, and that no one has ever questioned the team's annual budgets and financial statements regarding operation of the Triple A to see if any of the team's line items should set off alarm bells.
He also found that the main reason the Heat has not been sharing profits despite record breaking revenues is because the team owes $28 million in loans. Mazzella writes:
In fact, absent consideration of manager loans, etc., fiscal year 2011 would have been the first year that arena operations generated net cash flow greater than $14 million triggering the 60-40 profit share provision.Jorge Luis Lopez, an attorney for Miami Heat affiliate company Basketball Properties LTD., which runs the arena, says Mazzella's report amounted to a waste of taxpayer money. "After months of extensive review at the expense of taxpayers, he released a report with nothing in it," Lopez said. "He is questioning improvements and expenses that are legitimate under the agreement."
Miami Heat Audit
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