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2/11/02

Public Funds for Cruise Line Industry,
Community Development Funds Cut

"Royal Caribbean Cruises has brokered a deal with Miami-Dade County to do $16 million in improvements on its terminals to make room for a third ship of its largest class...The county, which governs and owns the Port of Miami, has agreed to reimburse the cruise line for its costs as work progresses. In return, company officials said, the county's investment should generate $1.4 million in additional annual revenues for the port from dock, wharf and parking fees...The cruise line will be reimbursed up to $16 million...under terms similar to those used in 1998 when the port expanded terminals 3, 4 and 5. Then, he said, it was Royal Caribbean that financed the renovations for about $76 million and the county reimbursed the line from port revenues."

Miami Today, Feb. 7th, '02; "County to repay Royal Caribbean for $16 million upgrade at Port" By Paola Iuspa

Independent Royal Caribbean Perspectives:
  • "Royal Caribbean - a cruise company with headquarters and ships based in Miami, a company that former First Lady Rosalyn Carter launched in 1988, a company that makes tens of millions of dollars in profits, largely on the basis of its U.S. customers-pays not one cent of U.S. taxes....From 1989 to 1992, revenue from the cruise business totaled more than $3 billion. Its operating profit-or profit before interest and taxes was $395 million. After interest payments of $237 million, the company's net income came to $158 million. On those profits, Royal Caribbean paid no U.S. income tax &...
  • Waiters and busboys, for example, were hired to provide that "refined hospitality and easygoing humor" at a salary that placed premium on tips. "We extend to you the opportunity of employment with our company in the capacity of busboy-waiter at a salary of $50 per month," according to a 1992 employment contract with a waiter and busboy &...
  • Royal Caribbean is essentially an American company, but according to SEC reports it is incorporated in Liberia and registers its ships in the Bahamas, Liberia, and Norway. It is known in the tax code as a "controlled foreign corporation," which is exempt from U.S. income tax." Preceding Bullet Points from: "America: Who Really Pays the Taxes" by James Steele & Donald Barlett, Fireside Books, 1994
  • "Like most American companies that operate commercial vessels, Carnival (Cruise line to be merged with Royal Caribbean) registers its ships in foreign countries, where there is an endless supply of workers willing to toil long hours for a pittance, and few labor unions to get in the way... "What's different about the cruise industry is you have the same kind of exploitative conditions going on, but they are all lawful." 'Miami New Times, Feb., 3rd, 2000; "The Perfect Scam", by Kirk Nielsen
  • "In September, Royal Caribbean, the world's second largest passenger cruise line, plead guilty and was fined $9 million for dumping oil and lying to the U.S. Coast Guard about it. In Miami, U.S. District Court Judge Donald Middlebrooks ordered the company to pay the $1 million fine for presenting a false oil record book for the Nordic Empress cruise ship to Coast Guard pollution investigators who had spotted the ship leaving a seven-mile long oil slick. When Coast Guard officials boarded the ship to investigate, they were presented with a false log designed to conceal the discharges." Multinational Monitor Magazine, December 1998
Meanwhile, Cuts to the:

  • Empowerment Zone: "President Bush wants to eliminate grants for empowerment zones in 15 urban areas -- including Miami-Dade County. The administration argues that tax breaks and other incentives are a more effective way to promote economic revival. The cut, included in Bush's budget proposal this week, is an about-face for the administration, which a year ago requested $150 million in grants for 15 empowerment zones." Miami Herald, Feb. 8, 2002; "DADE OPPOSE CUTS BY U.S." By Andrea Robinson
  • Community Development Block Grant Program: "Community Development Block Grants would be cut by over 7% (in real terms) under the proposed Administration budget. CDBG funds are funneled to states and fund important programs in your community. States will lose millions of dollars if the Administration budget is passed by Congress. Florida stands to lose $13,993,000 in next year alone." National Priorities Project, News Release, Feb. 6, 2002
  • Sadowski Affordable Housing Funds: "Governor Bush has proposed taking dedicated State Housing Trust Fund dollars generated by Sadowski Act documentary tax revenues to fund Everglades activities...Effectively, Everglades funding would be accomplished by taking funds from very low and low income families. The proposal would reduce housing funding by a total $145.5 million over the next eight years. This represents a 27% reduction in State Housing funding over that time period, based on current revenue estimates. While the State Housing Trust Fund receives only 4.8% of documentary tax revenues, it would finance over 18% of the Everglades project." Florida Housing Coalition