It will cost Miami-Dade County $2.4 billion over 40 years to repay $409 million in bonds, as the county finds it's expensive to borrow money these days.
It will cost Miami-Dade County $2.4 billion over 40 years to repay $409 million in bonds to fund construction of a new Florida Marlins ballpark, as the county finds it's expensive to borrow money these days — especially when the bonds are backed by some questionable revenue sources.
That's a staggering sum. True, the real cost of something is always a lot more than the upfront cost; just ask anyone who has ever bought a house and then saw the real cost of the purchase at closing, when interest is included. In the case of Miami-Dade County, the cost of borrowing $409 million for the new Florida Marlins is pretty much exactly like a house mortgage: initial payments will be low and not actually eat into the principal. (It's called backloading in the financial world and basically assumes future dollars will be worth less than present ones.) When you've got hundreds of millions compounding annually, you're talking some real money by the time all is said and done.
The $2.4 billion is considerably more than the $2 billion used by ballpark proponents and city officials when the deal for the Marlins ballpark closed. However, we're guessing the county never actually spends the $2.4 billion: This will be a deal ripe for refinancing once the economy improves.
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