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Boondoggle of Billions

Opposition mounts against government’s ‘illegal’ use of community redevelopment money.

 

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Cover Story

Thursday, Feb. 07, 08

Boondoggle of Billions

Opposition mounts against government’s ‘illegal’ use of community redevelopment money

By Cynthia Archbold

The Carnival Center for the Performing Arts.

Miami Mayor Manny Diaz had convinced almost everyone that his $2.9 billion downtown redevelopment plan was a good idea. Now a Miami auto magnate, two major cruise lines and several elected officials are battling the mayor’s “grand vision.”

In about a week, Diaz persuaded both the Miami City Commission and the Miami-Dade County Commission that Miami needed a new Marlins baseball stadium, a soccer stadium, a 6,000-car parking garage, a truck tunnel to the Port of Miami and landscaping for Museum Park to attract thousands of jobs and “revitalize the urban core.” He convinced them that the city could pay off the county’s construction debt for the Adrienne Arsht Center for the Performing Arts. He promised that the city would expand its Community Redevelopment Area to pay for it.

Both boards agreed to a “global agreement” in December — by a 9-4 vote of the County Commission and a 4-1 vote of the City Commission — and drafted a Memorandum of Understanding Jan. 9 to move forward with the plan.

Then came Norman Braman, a 75-year-old auto dealer, art collector and philanthropist who’s convinced that the proposal is a ploy to “stiff the poor” and hoodwink taxpayers into shelling out for more poorly planned and unnecessary public works projects. Braman launched a radio attack against the plan in January, buying 175 spots on English- and Spanish-language radio stations and calling the agreement a “downtown double cross.” Then he filed the first of many promised lawsuits in Miami-Dade Circuit Court last week to block the local governments from using tax dollars meant for building affordable housing and encouraging economic growth in Miami’s blighted redevelopment districts on the mega-project.

“It’s wrong to do that without going to the taxpayers for approval,” Braman said in a phone interview, adding that the city-county financial arrangements cited in his initial lawsuit “are direct violations of the law.” He plans to file another lawsuit “soon” to stop the expansion of the CRA to pay for projects that have nothing to do with creating low-income housing in the neighborhoods for which they were originally established.

Now, some elected officials are questioning the plan, too.

District 10 County Commissioner Javier Souto, one of four county commissioners who voted against the global agreement, supports Braman’s sentiments and also believes that the massive public works project should be decided by voter referendum.

“It’s just not right,” he said during a telephone interview. “It will be a big flop. So you know who’s going to foot the bill? You and I,” he said.

Souto wants hard proof that there is “slum and blight,” as required by state law, in the proposed CRA expansion areas, which include increasingly developed and valuable land surrounding the Performing Arts Center, Bicentennial Park and on Watson Island.

“I would like to receive all the evidence and basis for declaring these areas that you added to these two Community Redevelopment Areas as slum or blighted areas,” Souto wrote in a letter to County Manager George Burgess.

“Absent clear and convincing evidence that supports the expansion of the CRA boundaries for the direct benefit of the poor communities in Overtown and the Omni area, this is just another scandal similar to the Empowerment Zone, whereby Miami-Dade County becomes an active participant and accomplice in defrauding the African-American community out of dollars meant to tackle poverty and create opportunities for the African-American community,” he wrote.

As chair of the Recreation and Cultural Affairs Committee, which is charged with reviewing the part of the proposal concerned with $550 million Museum Park, Souto can block the plan from moving forward to a County Commission vote. And he vows to do exactly that if County Manager Burgess doesn’t answer his many questions.

“I asked the county manager, why are you trying to rush this through?” Souto said. “They bring the item in front of us without telling everybody about it.” Most of the negotiating, he said, was done in backdoor deals without public input.

“They want to hide it from the community, and there are billions and billions of dollars involved,” Souto said.

The city of Miami, Miami-Dade County, the Miami Sports and Exhibition Authority, the Miami Science Museum and the Miami Art Museum signed a Memorandum of Understanding Jan. 9 to transform Bicentennial Park into Museum Park. But the conditions in that agreement have Souto and others riled up.

On Jan. 18, leaders of the Miami Science Museum and the Miami Art Museum asked the Recreation and Cultural Affairs Committee for $3.3 million and $235,000 respectively, the first installment of the general obligation bond funds that voters approved in a 2004 referendum. But Souto found so many legal problems with the MOU that he instead canceled the meeting and put the issue “on hold.” In fact, Souto vowed not to release the museum construction funds until the county manager answers his questions.

“It’s convoluted,” he said. “The lawyers complicate things and try to hide things. The people don’t like that. It might be legal, but the people don’t want that, and it’s the people who pay the bills.”

In a memo to County Manager Burgess, Souto attacked “anomalies” in the terms of the MOU agreement. The document, not yet reviewed by the city and county commissions, sets the legal framework of ownership and fiscal responsibility for developing Museum Park on public waterfront park land in Bicentennial Park.

Souto argued that it is illegal to build the museums on waterfront park land protected from development by the city’s Joe Carollo amendment (named after Miami's former mayor), which requires voters to approve any such proposals by referendum.

“This convoluted deal seeks to avoid a referendum by the residents of the city of Miami,” Souto wrote in the letter. Instead of leasing the land to the museums directly, he wrote, the MOU calls for the city to lease land in Bicentennial Park to another entity — the Miami Sports and Exhibition Authority, which, in turn, would sublease the land to the museums for 99 years.

Another problem is that the museums are asking for a waiver of the county general obligation bond rules requiring that the museums have “control of the land” to receive taxpayer money, which they would not under the terms of the proposed deal.

Ownership of the buildings is another issue.

“Another anomaly with this deal is that the museums and their boards will be given ownership of the museum buildings, although they are constructed on public lands using public money,” Souto wrote. All other museums that were constructed with county funds, including Vizcaya, are owned by the public. 

Burgess plans to respond to these concerns at the Feb. 11 Recreation and Cultural Affairs Committee meeting, but Souto said he would not allow anyone to rush him into making a decision.

“We need time to review the report and analyze it before we make any decisions,” Souto said on the phone.

Mayor Diaz and County Manager Burgess did not return repeated calls and e-mails for comment.

However, Diaz, the mega-deal’s chief architect, and Braman squared off on the Channel 4 Sunday morning program hosted by Eliott Rodriguez.

“We want to build the kind of a city we want,” Diaz said. “We’re going through a time of economic downturn. The construction business has slowed down a lot, a lot of people are looking for jobs and this is a way to hopefully keep those people gainfully employed.”

He insisted that the deal “is a valid use of community redevelopment money,” even though those funds are designated under state law for affordable housing.

“Just because there have been some failures in the past doesn’t mean this isn’t the right plan and this is the right thing to do for downtown Miami and really for the region,” Diaz said, referring to the over-budget $141 million performing arts center.

Braman said he was “disappointed” that Diaz wouldn’t debate the issue with him side by side.

“The plan Diaz has presented was concocted in secret,” said Braman, owner of Braman Motors and former owner of the Philadelphia Eagles. “It was never brought to the public at all, or the city at all.

“This plan, I believe, is illegal,” he added. “This plan is morally wrong, and I believe this plan makes no sense from a business standpoint at all. It could bankrupt this entire community.”

Now Carnival and Royal Caribbean cruise lines are joining forces to fight the $1 billion tunnel — the most expensive item in the mega-deal. “Does anyone have confidence that we can accomplish this incredible engineering feat despite our history with major construction?” Terry Dale, president of Cruise Lines International Association, wrote in a letter to the editor published in the Miami Herald Monday. “It strains credibility to suggest that there will be no safety or cost problems.”

Dale said the tunnel could make traffic even worse, by backing up more trucks waiting to get through security barriers. “We support actions to deal with excessive truck traffic,” he wrote. “The traffic situation can be resolved through alternative routing at a cost lower than that of building a tunnel.”

Still, museum leaders remain unfazed by both the lawsuit and Souto’s objections, even though they are depending on the county and the city for their first installment of cash from general obligation bond funds. In total, the Science Museum will receive $175 million, while MAM will receive $100 million from taxpayers.

“It’s just a temporary hiccup,” said Miami Science Museum Executive Director Gillian Thomas. “[Souto’s] entitled to his opinion.”

Could he stall the project indefinitely? “I doubt that very much — I think that’s very much not the case,” she said. Thomas plans to complete museum construction by 2011-2012.

Miami Art Museum Director Terence Riley said that no matter what happens, he plans to break ground by December and open by 2011 or 2012. “We are not going to wait,” he said, since the art museum had long foreseen and planned for obstacles and delays in getting public funding.

“We are going to keep our project going based on private funding, and we are going to let the city and the county work all these things out. We know it is going to take a long time — we know it’s going to take longer than we thought. And so we have arranged our financing so we are less dependent on the public funds.” The museum’s board of directors has raised $35 million in pledges so far, but, Riley said, “we absolutely need the county to come through with $100 million” to complete the construction.

“We have been working on this for 10 years and we have done very well in terms of raising money,” MAM board Chair Aaron Podhurst said in a telephone interview from a ski vacation in Aspen. He described the “global agreement” as the “global fight,” adding that politics should not be allowed to detain Museum Park.

“CRA money is irrelevant to what we’re doing,” he said. “We will deliver the museum on time and on budget.”

Comments? E-mail letters@miamisunpost.com