Taking a Look at the Miami Forever Bond

 

Miami Forever Bond Fact Sheet

Compiled and written by Jenna Balfe and Pebble Yaffe

 

This information sheet is divided into three sections: the first section begins by defining the two basic types of municipal bonds (GO and revenue) and provides information regarding  the 2001 Homeland Defense/Neighborhood Bond; the second section provides concise information regarding the Miami Forever Bond; and the third section provides information on alternative options for technologies proposed by the Miami Forever Bond and lobbyist group.

 

Section 1:

Bond Breakdowns:

The two most basic types of bonds are general obligation bonds and revenue bonds – where in both, the issuer guarantees repayment, either through taxation or by collecting revenues by from projects financed with the bonds.

When a general obligation bond is issued, it means the issuer is guaranteeing repayment by any means necessary. “The issuer is going to use any taxation power in its authority to make sure you get paid back, putting the revenues from every type of tax on the hook to guarantee the bonds: income taxes, corporate taxes, property taxes, sales taxes, excise taxes, gas taxes, any tax that can be levied by the issuer.” Thus it’s name as a general obligation bond, as the issuer is generally obligated; if for any reason the issuer has trouble paying the money back, taxes must be raised unless the money can be raised in another way.

 

Revenue bonds, unlike GO’s, don’t rely on taxation–but rather the revenues generated by the issuer. For example, “Water districts can issue revenue bonds with the revenues from people’s water bills guaranteeing the repayment of the bonds.”

(http://www.municipalbonds.com/education/two-types-of-bonds-general-obligation-vs-revenue-bonds/)

 

Homeland Defense and Neighborhood Improvement Bond:

The Homeland Defense/Neighborhood Improvement Bond 2001 was up for vote during the 2001 November 13th election for $225 million in bonds “to improve Miami’s neighborhoods and enhance the safety of our residents! All neighborhoods will benefit from these dollars with NO increase in the current tax rate!” (http://www.miamigov.com/BondOversight/brochures/factsheetenglish.pdf)

The Proposed Allocation:

  • $127 million – Parks & Recreation
  • $54 million – Streets & Drainage
  • $38 million – Quality of Life
  • $31 million – Public Safety
  • $5 million – Historic Preservation

 

The bond was given the relevant at the time ‘homeland’ name following 9/11, despite only 12% of the bond being allocated to public safety. ‘“It’s extremely deceptive,” commented then-Mayor Joe Carollo, who refused to endorse the measure after the commission unanimously agreed to put it to voters in early October 2001. “It’s wrong to use the situation we have in our country today to try to get these bonds approved.”

 

“Splashy mailings were sent out to Miami residents saying the bond would be used for ‘Nuclear Biological Chemical Disaster Supplies.’ Ex-Commissioner Johnny Winton defended it before the vote: ‘You’re always looking for the right buzzwords. That’s part of the selling process.’”

 

Not much research was done on cost, as it needed to get passed quickly. “I think people voted for it because they were lulled into this fear thing, and [proponents] loaded in other things that didn’t have anything to do with homeland security,” says Steve Hagen, who heads the parks committee for Miami Neighborhoods United, Nina West, who sits on Miami’s planning advisory board, still feels bamboozled. Voting no would have been like rejecting ‘mother and apple pie,’ she says. ‘I remember voting for it, but I don’t know how many more bond issues I will ever, ever vote for.’” (http://www.miaminewtimes.com/news/parks-bond-languishes-6332561)

 

The following is a further detailed list of the initial proposed allocation of money:

 

Parks & Recreation/$127 million:

  • Little Haiti Park:
    • Proposed: Acquisition and construction of an approximately 30-acre park with a community center and full facilities.
  • Virginia Key Park Improvements:
    • Proposed: To Create a safe swimming area, install 12 new picnic shelters, renovate existing buildings and roadways and install new landscaping and nature trails.
  • Bicentennial Park Improvements:
    • Proposed: Remove the berm to create nightlines to the water, install a 50-foot walk with palm trees, lighting and benches, install additional landscaping and lighting and renew bulkheads.
  • Jose Marti/East Little Havana Park Expansion:
    • Proposed: Acquisition and development of additional land for the park.
  • Margaret Pace Park Improvements:
    • Proposed: To complete construction of all of the phases in the existing master plan.
  • Soccer Complex Development:
    • Proposed: Land acquisition and site development for a dedicated complex for soccer.
  • City-wide Waterfront Improvements:
    • Proposed: This project will enable the shoreline stabilization and seawall improvements necessary throughout the City.
  • Marine Stadium Renovation:
    • Proposed: To renovate and improve the seawall, stadium, parking and marina at the site.
  • Neighborhood Park Improvements and Acquisition:
    • Proposed: City-wide improvements and land acquisition for future parks.
  • Fern Isle Cleanup and Renovation:
    • Proposed: To remove and dispose of materials from the site, to create a new holding area for debris, and to extend and enlarge the park site.
  • Orange Bowl:
    • Proposed: Renovations

 

Streets and Drainage/$54 million:

  • Flagami Flooding Mitigation – Renovates the entire storm water drainage system in Flagami and creates a pump station to eliminate excess water.
  • Grand Avenue Improvements – Widens sidewalks, improves lighting and upgrades landscaping along Grand Avenue.
  • Model City Improvements – Funds those infrastructure improvements necessary for the development of the Model City Homeownership Zone.
  • Coral Way Improvements – Reconstructs the street, upgrades lighting, improves landscaping and beautification of medians along Coral Way.
  • Calle Ocho Improvements– Reconstructs the street, upgrades lighting, improves landscaping and beautification along Calle Ocho.
  • NE 2nd Avenue Improvements (36th Street to 78th Street) – Includes new eight-foot sidewalks, new crosswalks, improved medians, better lighting, and underground electrical, and new street furniture.
  • Design District/Overtown, Wynwood, Little Haiti Corridor Improvements – Project consists of roadway improvements, utility relocation and beautification initiatives for the entire district.
  • Downtown Infrastructure Improvements – Renovates and improves sidewalks, landscaping, roadways, and crosswalks in the downtown area.

 

Quality of Life/$38 million:

  • Quality of Life – Project allocates $5 million per Commission district to accomplish neighborhood-specific improvements as the community may request (e.g., curbs, gutters, road improvements, storm sewers, etc.).
  • Greenways – Project consists of the improvement of the City’s greenspace.
  • Museum of Science – Contribute funds to assist the museum with its development efforts for a Bicentennial Park location.
  • Miami Art Museum – Allocate monies to assist the museum in establishing a development site at Bicentennial Park.
  • Neighborhood Gateways – Project consists of funding to place signs at the entryway of the City’s neighborhoods.

 

Public Safety/$31 million:

  • Homeland Defense Preparedness Initiative – This project will provide the necessary equipment for identification and interdiction of threats as well as to provide first responders with the protective equipment and specialized equipment to counter threats.
  • Neighborhood Fire Stations & Training Facility – This project will build two new fire stations (Coral Way and Upper Eastside areas) and allow for the refurbishment of a third fire station. A new Regional Disaster Training Facility will be built.
  • Police Training Facility – This project will construct a new Police Training Facility to ensure the highest level of security for our residents.

 

Historic Preservation Initiative/$5 million:

  • Funds will provide for the preservation of some of Miami’s historic buildings.
  • Identification and Designation of historic properties as local historic sites and historic districts.
  • Nominations to the National Register of Historic Places for individual buildings and/or districts.
  • Develop programs to assist property owners of historic properties.

 

Planning and Spending Issues:

When the Board was asked to explain why every project had been exceeding their initial proposed dollar amounts, Mary Conway, Chief of Operations, explained the following: in the beginning there were concepts for projects but not an informed dollar amount associated with it–i.e. site locations, architects, contracts, etc. Thus, by the time a detailed scope of a project was finally put together it became clear projects would exceed their original projected budget. In addition, years transpire between the conception of a project, organizing all of the varying factors going into it, and finally its implementation. Over this time period, the market changes, as well as the needs or desires of the community.

 

As Mary sums it up, “We do that and there are cost elements that are associated, so some of the funding shortfalls and the funding gaps are attributable to scope changes, and in addition to not necessarily having the most developed scopes at the beginning five years ago when the bond was conceived, when you don’t have as accurate and detailed a scope, you obviously don’t have an accompanying cost estimate that is as accurate or detailed either, so that is a contributing factor.”

(http://www.ci.miami.fl.us/BondOversight/docs/minutes/BOB%2002-27-07%20Minutes.pdf)

 

Board Qualifications:

As stated by the authority of Code Section 2-1200, (Ordinance 12177), Code Sec. 2-881, the following goes over all details pertaining to the Oversight Board:

  • Role of Oversight Board
    • (1) To serve in an advisory capacity to the City Commission related to the monitoring of the resources derived from the issuance of general obligation bonds, approved by the electorate on November 13, 2001, for homeland defense preparedness and neighborhood improvements and enhancements for projects other than those specifically identified by the City Administration and set forth in informational pamphlets and media releases distributed to the public prior to said election; (2) to identify projects related to historic preservation and improvements for public safety, parks and recreation, and quality of life issues (greenways, street paving drainage, sidewalks and lighting); (3) to recommend amount of funding to be dedicated for each improvement or project; (4) to monitor each project’s status for efficient use of allocated funding; (5) to expedite the development of the following projects identified as priorities by the City Commission; (a) a state of the art training facility for City of Miami Police and Fire personnel; (b) the Little Haiti Park; and (c) City-wide road and sidewalk repairs.
  • TERMS: One year or until the nominating Commissioner leaves office, whichever occurs first. Board to sunset December 31, 2011.
  • APPOINTED BY: Five members appointed by the Mayor; and ten members appointed by the City Commission, with each Commissioner nominating two individuals.
  • QUALIFICATIONS: Section 2-884 of the Code applies. Shall either be permanent residents of the City of Miami or own real property in the City, or work or maintain a business in the City, and shall have good reputations for integrity and community service. In addition, should have demonstrated an interest in the field, activity or sphere covered by the board. Each board shall include at least one member whose livelihood does not depend on the area regulated, administered or dealt with by the board. An employee of Miami-Dade County, Florida, or any municipality therein other than a City of Miami employee, shall not serve on or be appointed to any board of the City, unless the commission waives this restriction by a four-fifths affirmative vote of its membership and the employee is a resident of the City of Miami.

(http://www.miamigov.com/BondOversight/docs/homelandcharter.pdf)

 

Current State of Debt:

Currently, the City of Miami still owes $147,355,000 from the Homeland Defense and Neighborhoods Bonds.

(http://www.miamigov.com/Finance/MonthlyFinancialReports/MFR2017/Monthly%20Financial%20Report%20-%20August%202017.pdf)

 

Section 2:

Miami Forever Bond

 

  • What is proposed by the City:
  • Miami Forever is a series of construction projects that will change the future of the City of Miami by investing a total of $400 million into five broad categories:

 

  • Flood Prevention and Sea Level Rise Mitigation ($192 million)
  • Parks and Cultural Facilities ($78 million)
  • Roadway Improvements ($23 million)
  • Affordable Housing and Economic Development ($100 million)
  • Public Safety ($7 million)

 

Further Information

  • In the interoffice memo associated with the approving referendum approved on July 21, 2017, the backup detail for the Miami Forever Bond attached here (lists all proposed projects used to create the budget for the GOB and then go to: 2181 – Submittal – Vice Chair Russel – List of Projects for GOB) shows how the city came up with the general categories and budget for the ballot item. The proposed projects list was created for a Bond of $300,000,000.00. The current proposal for the Bond is $400,000,000.00, meaning there is a $100,000,000.00 discrepancy
  • In this memo, there is no mention of whom will be contracted to do the projects.
  • Mayor Regalado has recently proposed that 10 million of the bond money marked for “Parks and Cultural Facilities” go toward the redevelopment of the historic Coconut Grove Playhouse.
  • “The mayor, however, doesn’t want the money to finance the county’s current vision for a cultural campus and 300-seat theater, which he sees as inadequate. Instead, he wants to support a dueling proposal backed by Miami attorney and campaign rainmaker Mike Eidson.” ( Smiley, Miami Herald) To see the full article click here.

 

City of Miami explanation of how the Bond will be funded

  • Miami Forever will be funded through a General Obligation Bond (GO Bond). A GO Bond is one way cities fund major construction projects such as roads, parks, drainage, and/or buildings. They are backed by the full faith and credit of the City.- This GO Bond will be repaid through the 3% in your tax bill currently allocated towards paying off the previous bond as specified in the ballot language  

 

Further Information

 

  • In The Storm Water Master Plan Funding Request created by Florida Senator Jose Javier Rodriguez under program performance, section b, item 12. It reads:  “Evaluation of funding options including grants, bonds, loans, storm water utility rate options, public-private partnerships” Yet there have been no other publicly announced attempts at finding funding for said improvements other than the GO Bond.

 

 

  • The next step for Regalado and the commissioners who supported the item will be to campaign for it, and convince taxpayers that they should fund the increased spending through their tax bills. Chief among their talking points: that new debt will only be taken on as old debt comes off the books, so property owners won’t actually see an increase in their tax rate but will continue to pay debt on the bonds for decades. (Smiley, Miami Heraldl)

 

Role of Oversight Board provided by the Miamiforever.org lobbyist group

  • These projects will evolve as the city updates the Stormwater Master Plan, ensuring projects are based on the very latest engineering and the needs of Miami residents over the next two decades. Projects will be chosen by a Citizens Oversight Board and the City Commission in a process open and transparent to the public, and trackable on the city’s website (MiamiForever.org).

Further Information:

  • The Oversight
  • Need for complete itemized budget (Need for)

 

Section 3:

Proposed Technologies for Flooding Mitigation

 

  • Storm Water Pumps

 

“After $400 million of investment to raise the streets and after businesses suffered through three years of construction, we are still flooding the same way as before,” Pubbelly Group’s Juan Ayora said yesterday. “We still had to pay taxes and get permits those years. Where did the money go?” (Ianelli, Miami New Times) To see full article click here.

  • Raised Roads
  • Sea Walls

 

Alternatives Technologies

    • Mitigation Measures: Both Adaptation and Mitigation are necessary.
      • Reducing Carbon Emissions
    • Deep Well Injection: An injection well is used to place fluid underground into porous geologic formations. These underground formations may range from deep sandstone or limestone, to a shallow soil layer. Injected fluids may include water, wastewater, brine (salt water), or water mixed with chemicals. (EPA website) click here to read more.
    • Innovative Hybrid Infrastructure Approaches: There is substantial evidence that natural infrastructure (i.e., healthy ecosystems) and combinations of natural and built infrastructure (“hybrid” approaches) enhance coastal resilience by providing important storm and coastal flooding protection, while also providing other benefits. (Sutton-Grier, Wowk, Bamford)
      • “Coastal wetlands in the U.S., for example, were estimated to provide $23.2 billion per year in storm protection services alone based on a regression model of 34 major hurricanes to hit the U.S. since 1980; a loss of 1 ha of wetland in the model corresponded with increased average storm damages of $33,000 from specific storms” ((Costanza et al., 2008) (Sutton-Grier, Wowk, Bamford))
    • Stormwater is also a resource and important as the world’s human population demand exceeds the availability of readily available water. Techniques of stormwater harvesting with point source water management and purification can potentially make urban environments self-sustaining in terms of water. (wikipedia, https://en.wikipedia.org/wiki/Stormwater)

 

Alternatives Funding Sources to Bond:

In The Storm Water Master Plan Funding Request created by Florida Senator Jose Javier Rodriguez under program performance, section b, item 12. It reads:  “Evaluation of funding options including grants, bonds, loans, storm water utility rate options, public-private partnerships” Yet there have been no other publicly announced attempts at finding funding for said improvements other than the GO Bond.

 

References:

 

“City of Miami Website” http://www.miamigov.com/BondOversight/docs/homelandcharter.pdf

 

“City of Miami Website” http://miamifl.iqm2.com/Citizens/Detail_LegiFile.aspx?ID=2184&highlightTerms=miami%20forever%20bond

 

“City of Miami Website” http://www.ci.miami.fl.us/BondOversight/docs/minutes/BOB%2002-27-07%20Minutes.pdf

 

“Future of our coasts: The potential for natural and hybrid infrastructure to enhance the resilience of our coastal communities, economies and ecosystems.” Environmental Science & Policy, Elsevier, 28 Apr. 2015, www.sciencedirect.com/science/article/pii/S1462901115000799.

 

“General Information About Injection Wells.” EPA, Environmental Protection Agency, 6 Sept. 2016, www.epa.gov/uic/general-information-about-injection-wells.

 

Iannelli, Jerry. “Why Did Miami Beach’s Multimillion-Dollar Anti-Flood Pumps Fail?” Miami New Times, 5 Oct. 2017, www.miaminewtimes.com/news/miami-beach-floods-from-tropical-storm-emily-overwhelm-sea-level-rise-pumps-9543575.

 

“Miami Forever.” Miami forever, www.miamiforever.org/.

 

“Park Bond Languishes” Miami Herald, Janie Zeitlen, http://www.miaminewtimes.com/news/parks-bond-languishes-6332561

 

Smiley, David. “Regalado doubles down on sea-Rise projects as cost estimates approach $1 billion.” Miamiherald, www.miamiherald.com/news/local/community/miami-dade/article162550318.html.

 

Smiley, David. “Miami Commission sends $400 million general obligation bond to the voters.” Miami Herald, 27 July 2017, www.miamiherald.com/news/local/community/miami-dade/article164102937.html.

 

Smiley, David. “Miami has a cost of living problem. Now, voters will decide on $100M for housing aid.” Miamiherald, www.miamiherald.com/news/local/community/miami-dade/article178126006.html#0.

 

“Stormwater.” Wikipedia, Wikimedia Foundation, 20 Oct. 2017, en.wikipedia.org/wiki/Stormwater.

 

Viglucciavi, Andres. “Here’s what a new $20 million plan for Coconut Grove Playhouse looks like.” Miamiherald, www.miamiherald.com/news/local/community/miami-dade/coconut-grove/article179274751.html.

 

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