More than 400 people attended a recent Miami-Dade Beacon Council‘s annual meeting at the InterContinental Miami, where business and civic leaders touted the agency’s recent wins and toasted its new chair.

For the first time, the county’s economic development group combined its annual meeting with its key ceremony, providing insights into the companies it helped expand or move to Miami-Dade.

The Beacon Council reported that 46 companies relocated or expanded in Miami-Dade County in the 2016-2017 fiscal year, bringing in more than 2,100 new jobs to the region and generating $209.7 million in new capital investment.

The event marked the first annual meeting attended by the organization’s new CEO and President Michael Finney, who previously served as the president and CEO of the Michigan Economic Development Corporation.

“I’ve been impressed with… the warm Miami welcome,” Finney said. “There is really commonality here and a desire to work with one another that’s in full display.”

One of the key accomplishments highlighted at the event was Amazon breaking ground on an 855,000-square-foot fulfillment center in Opa-Locka in June. The project is expected to open by the end of 2018, and Amazon said the warehouse will bring at least 1,000 jobs to the local economy.

While Amazon was not in attendance at the event, other companies present included online boat marketplace Boats Group, which brought in 80 new jobs to the county and a capital commitment of $1.05 million; and Dunham Bush, a Malaysian manufacturer, which added 51 new jobs and $12.5 million in capital.

The economic development agency also touted its new programs and task forces. Specifically, it mentioned its “Connect and Grow” program, which works to connect entrepreneurs and innovators and their new products and technologies to established businesses.

The Beacon Council‘s new Chair Nelson Lazo, CEO of Doctors Hospital, addressed the audience. Lazo takes over for Jaret Davis, co-managing shareholder of Greenberg Traurig’s Miami office, as the agency marks the start of its new fiscal year.

“It is time we told the new story of Miami instead of letting old narratives define who we are to the world,” said Lazo, after thanking Davis for his service.

Davis received video tributes from the economic development group and the University of Miami, which will honor him for contributions to his alma mater on Nov. 4 during its homecoming game at Hard Rock Stadium. Miami-Dade County Mayor Carlos A. Gimenez was one of many to laud Davis‘ contributions to the county’s economic landscape.

“You’re outstanding and a great treasure…. for everything you have done for this community,” said Gimenez, who then handed Davis a a plaque commemorating Thursday, Oct. 26 as Jaret Davis Day.

Since 1985, the Miami-Dade Beacon Council has assisted more than 1,000 businesses that have created nearly 70,000 direct jobs and generated more than $4.6 billion in capital investments, it said.


Source: SFBJ

Wages, salaries, and total compensation are rising faster in Miami than any other major city.

In the 12 month period ending June 2017, wages and salaries in the Miami-Fort Lauderdale-Pompano Beach, FL MSA increased 3.9%, while total compensation was up 3.7%, according to the Bureau of Labor Statistics.

Seattle ranked second in wages and salaries gains at 3.6%, while New York placed second for total compensation increase at 3.3%. Washington D.C. and Philadelphia ranked lowest.

Wage gains are also accelerating. In 2015-2016, the increase in Miami was 2.5% for total compensation and 2.9% for wages and salaries.

Miami Today first reported the data.


Source: The Next Miami

RealConnex, a platform that connects real estate professionals to both access to capital as well as investments, has announced a strategic partnership with the Miami Association of Realtors.

According to RealConnex, the agreement will see the Miami Association of Realtors, and their 46,000 plus members, leverage the RealConnex platform to manage their properties and transactions. The platform wants to provide a wide variety of services for property investing – not just access to capital.

The Association is said to be working with RealConnex to add new features and improve design. RealConnex plans to roll out the program to other real estate associations accross the US.

RealConnex was founded to solve a problem faced by many real estate developers: funding mid-market projects and connecting to the right capital sources and service providers. RealConnex says it currently has a community of 72,000 developers, sponsors, capital sources, service providers and owners. It expects to reach the 100,000 member mark by the end of 2017. RealConnex claims it is on track to facilitate up to $1 billion dollars in transacted deals on its platform within the same time frame.

“RealConnex will provide our members with a powerful competitive advantage,” said Teresa Kinney, CEO of Miami Association of Realtors. “The platform will make it significantly easier for our members to collaborate, share, network and distribute listings locally, nationally and internationally.”

RealConnex founder and CEO Roy Abrams said he looked forward to extending their collaboration as they build out the network.

“As a New York- and Miami-based real estate technology startup, we are excited about working with MIAMI to offer better service to its member realtors and promote South Florida’s booming economy,” said Abrams.


Source: Crowdfund Insider

The metamorphosis that’s already taken Wynwood’s industrial district from urban blight to urban paragon in record time seems poised for a dose of development Muscle Milk that could pump up the scale of construction along a broad, mostly vacant swath of the neighborhood to new, and somewhat controversial, heights.

The two biggest players in Wynwood’s snowballing transformation, at odds for months over a massive redevelopment proposal that some fear could overwhelm the human scale and funky vibe that define the district, have reached an agreement that softens its impact on the neighborhood fabric of spiffed-up warehouses, and likely clears the way for its preliminary approval by the Miami City Commission.


That would mean that Wynwood’s largest landowner — moving-company and arts entrepreneur Moishe Mana — can move ahead with an ambitious 30-year blueprint for what amounts to a miniature city containing nine million square feet of space on some 24 acres of mostly vacant land stretching from the neighborhood’s main street, Northwest Second Avenue, to its western edge at Interstate 95. The contemplated Mana district, centered around a green public central square, or “commons,” that would cut diagonally through the development, is aimed at luring tech companies, commercial trade and arts and cultural institutions to Wynwood.

The board of Wynwood’s Business Improvement District, a city-chartered agency that represents most property owners in the rest of the former industrial zone, voted Wednesday to support the Mana Special Area Plan after winning a series of concessions aimed at making sure the developer’s new buildings mesh with the surrounding fabric of simple industrial buildings, many of which have been transformed into art galleries, offices, shops and dining and drinking spots.

“There was a lot of reasonable anxiety that you would have this district-within-the district that would be out of scale and out of character with the area,” said Albert Garcia, a member of the BID’s board and its planning committee, which negotiated the deal with Mana. “Over the last six months we’ve made a lot of progress in dialing that back so that it doesn’t suck the life out of Wynwood, which is the nightmare scenario. It’s a much better plan. I believe Mr. Mana understands our vision and it’s now a shared vision. We like to do things on a community basis and seek consensus. That’s the DNA of Wynwood. Wynwood is a special place. It’s not a race to the sky.”

Mana’s architect and planner, Bernard Zyscovich, said the developer and his team are happy with the revised plan. Though it’s now scheduled for the first of two commission votes on Thursday, Zyscovich said Mana will likely ask for a two-week postponement to address issues brought up by residents of neighboring Overtown and Commissioner Keon Hardemon, whose district includes both neighborhoods. Those concerns include how the new development would affect adjacent residential areas in Overtown as well as the availability of jobs for residents.

“It’s all positive,” Zyscovich said. “I think we have a great plan, a plan that’s going to create a whole neighborhood that’s exciting and beneficial to our neighbors.”

The BID also had to relent on some issues. Mana would not budge on plan provisions that would allow him to build residential towers of up to 24 stories. But Mana’s team agreed to push those off Second Avenue to the western portions of his property along Northwest Fifth Avenue and I-95, and to conform to current, lower zoning where new buildings would face the existing neighborhood.

Mana’s proposal, unveiled at the end of 2015, riled BID leaders and neighboring property owners. After more than a year of planning, they had just won city approval for special zoning rules designed to control development by increasing allowed heights in most of the old Wynwood industrial district but capping them at eight or 12 stories, depending on location. The goal of the Neighborhood Revitalization District, as the new zoning plan was dubbed, is to foster development of relatively inexpensive housing and new office and retail space while preserving the neighborhood’s modest scale and pedestrian-friendly ambiance.

To take advantage of the increase, developers must pay into a special fund to help finance parking garages, affordable housing, creation of public green space and landscaping and improvement of streets and sidewalks, but Mana wanted to be exempted from the fees. He has now also agreed to participate in funding the programs.

Other changes to Mana’s initial plan aim to ensure his district is closely connected with the surrounding neighborhood. The rules would now require “active uses” like shops and restaurants at sidewalk level along principal facades and pedestrian passageways to break up large structures and encourage walking.

“If you’re a pedestrian crossing the street or you are driving down the street, it’s going to feel continuous and harmonious,” Garcia said. “We didn’t want those jarring transitions where you might have eight-story buildings on one side of the street and 24 stories on the other.”

New rules also allow Mana to begin building his taller residential structures only after he has completed defined percentages of the promised commercial and cultural buildings and public amenities, including meeting space and the central commons. That’s to ensure that those elements, which BID leaders and other neighborhood supporters say are critical to Wynwood’s evolution and comprise the most significant pieces of the Mana plan, don’t get lost or left for last, they said.

“What will make Wynwood an interesting place in 10 years from now and 20 years from now is if that art school and the cultural institutions and tech set up permanent camp here,” said David Polinsky, a developer who is a BID board member and chair of the planning committee. “Not everybody’s happy with the scale [of the Mana plans]. But the board feels reasonable compromises were made. There are still lots of good things that can come out of the [project] if it’s executed well.”

Those good things, Zyscovich said, will include buildings with large, flexible floorplates that can accommodate everything from showrooms and meeting rooms to offices, art exhibition galleries and “maker spaces.” Mana is now working on a plan to create an international trade center on site to link buyers and suppliers of products in Asia and Latin America, he said. Mana also plans to replicate elements of his Mana Contemporary art center, a converted tobacco warehouse in Jersey City, New Jersey, that combines artist studios and exhibition galleries with services such as fine-art storage, transportation and conservation, Zyscovich said. The plan also includes hotels, but the potential residential buildings, Zyscovich stressed, are secondary.

“Our main idea is not to create more residential, which everyone is doing,” Zyscovich said. “We’re looking for a job creation strategy. Showrooms, office infrastructure, entrepreneurial spaces — all that is very much the idea.”

There are some unsettled matters. Mana, whose holdings are centered around the former Wynwood Free Trade Zone complex, which he purchased in 2010, has been using the facility and adjacent vacant land for large special events under a temporary permit, including a reggae performance that recently drew a reported 60,000 people.

BID leaders want those events curbed because they say they’re disruptive and detract from Wynwood’s particular ethos. Mana has in principle agreed to abide by normal city rules for such events. They also want Mana to support a proposed expansion of the boundaries of the BID — a special taxing district that levies a fee on property owners to support special services like security and trash cleanup.

Some Mana properties now sit outside the BID boundary, but the expansion would mean all of Mana’s holdings would be subject to the levy. Mana — whose failure to vote on any of his properties contributed to a defeat last year of a previous effort to expand the BID — has agreed to support the expansion. But he has not committed to paying the additional levy. If the city commission approves Mana’s development plan on first reading, the BID agreed it would negotiate the terms of his participation before the second reading.

The BID board made it clear last week that they would rescind support for Mana’s plan if he doesn’t follow through on his promise to support the expansion. Because the plan is conceptual and doesn’t bind Mana to building as promised, there is still substantial concern in Wynwood over the proposal and its potential impact on the neighborhood renaissance, Garcia said. But if Mana does follow through on his promises, he added, Wynwood stands to benefit significantly.

“On the plus side, if it’s developed as planned and does bring the economic stimulation it promises, it’s a win for Wynwood and for Miami,” Garcia said.


Source: Miami Herald

An Asia Task Force organized by the Greater Miami Chamber of Commerce wants to organize Miami trips for Chinese journalists, investors and developers to help market the city to businesses and entrepreneurs from the Far East, The Real Deal has learned.

Greater Miami Chamber of Commerce’s Asia Task Force

Greater Miami Chamber of Commerce’s Asia Task Force

At its first brainstorming session Friday morning, the eight-member task force laid out its objectives. Task force chairman Seth Gordon, a Miami publicist who represents Shanjie Li, the Chinese businessman whose company purchased a 2.39-acre site on Brickell Avenue for $74.7 million last year, said he wanted the Chamber to sponsor a delegation of reporters from China, who would then write articles about Miami’s business offerings. Gordon told other members he recently hosted a small contingent of eight Chinese journalists with assistance from Turnberry Associates founder Don Soffer and Carnival Cruise Lines.

“Don is very interested in working with the Chinese,” Gordon said. “He contributed a full week of rooms at the Fontainebleau Miami Beach hotel and we flew them in with eight round trip business class tickets provided by Carnival.”

While the reporters were in Miami, Shareef Malnik, owner of the Forge, had them over for dinner at the storied restaurant’s wine room, Gordon said. In addition, developers Armando Codina and David Martin briefed the reporters on their respective projects.

“If we do it as a chamber project, we can do something more serious,” Gordon said.

Peng Lu, Florida International University’s associate provost of international programs, said the college would like to coordinate events and activities, including meetings with top business leaders in Miami, for a delegation of 22 Chinese business people visiting the city in mid-September.

“Two of them are billionaires,” Lu said. “One is a frozen food king in China who wants to buy fish products from Latin America. They are all extremely interested in seeing what business opportunities are here.”

In exchange, Lu said FIU can assist the chamber in organizing a business delegation trip to important cities in China. Andy Perez, CEO of South Miami-based EB5 Visa Funds, also suggested the chamber consider sponsoring classes on how to conduct business with the Chinese.

“One of the most important things you can do is educate the chamber’s membership,” Perez said. “It’s very important, down to how you hand over your business card.”

The task force is scheduled to meet again at the end of September.


Souce: The Real Deal

At a time when mall shopping is dwindling, there’s a plan afoot to build what would become the country’s largest shopping center, complete with a ski slope, sea lions and Legoland.

Though centered around a mall, the proposed American Dream Miami would also have a Ferris wheel, roller coaster, and 500-foot-tall observation tower. Most of it would be enclosed by a dome shown here in the artist’s rendering of the theme park. Proposed for Northwest Miami-Dade County, the project comes from the developer behind Minnesota’s Mall of America

Though centered around a mall, the proposed American Dream Miami would also have a Ferris wheel, roller coaster, and 500-foot-tall observation tower. Most of it would be enclosed by a dome shown here in the artist’s rendering of the theme park. Proposed for Northwest Miami-Dade County, the project comes from the developer behind Minnesota’s Mall of America

The $4 billion plan, as detailed by the Miami Herald, would employ 25,000 people in its 200-acre complex, which is slated to be located in Miami’s suburbs. That would make it Miami-Dade’s largest private-sector payroll, the publication noted.

The bold plan comes at a tricky time for malls, as shoppers are snubbing them in favor of Internet shopping, or simply heading to Main Street. Construction on new enclosed malls has ground to a standstill, with only one, Florida’s University Park, opening in the past decade. Given the shift in consumer trends, it may seem risky to plan such a huge undertaking, but the developer is betting that the sheer size and variety of attractions will get people hooked.

The complex is slated to offer stores and a range of attractions, such as a skating rink, a waterpark and a theme park including a roller coaster and Ferris wheel. The developer, Triple Five, is also the company behind Mall of America, which has about 4.2 million square feet and offers 520 stores and 50 restaurants. While the developer didn’t disclose the square footage of the planned Miami mall, it told the publication that the new mall will be larger than Mall of America.

“It is our intent that this project — American Dream Miami — will exceed our other world famous projects in all respects,” Triple Five said in a statement. Triple Five didn’t immediately return a request for comment.

Plans for a water park at the American Dream Miami entertainment complex include 20 different “slides and water treatments,” and the world’s tallest indoor bungee tower. Proposed for Northwest Miami-Dade, the complex would be the largest mall in the United States. Proposal by developer Triple Five

Plans for a water park at the American Dream Miami entertainment complex include 20 different “slides and water treatments,” and the world’s tallest indoor bungee tower. Proposed for Northwest Miami-Dade, the complex would be the largest mall in the United States. Proposal by developer Triple Five

The outsized mall comes at time when enclosed malls are shutting down, becoming ghostly relics of a bygone retail era. There’s even a site called that records the locations of razed or shuttered malls, such as downtown Rochester, New York’s Midtown Mall, which opened in 1963 as the first urban indoor mall in America. After struggling to keep tenants, the mall was closed in 2008 and demolished in 2010.

The decline of the mall has been precipitous enough that an executive with one of the largest privately held real-estate companies last year projected that the traditional mall could be dead in a decade.

But American Dream Miami isn’t aiming to be an ordinary enclosed mall. The glass-covered structure would also include luxury hotels, miniature golf, and a ski slope with 800 feet of artificial snow.

While the mall will bring more jobs to Florida, many of those will be in the types of low-paying occupations that are common in the state, such as store clerks and waitstaff. Median household income in Florida stands at about $47,000, below the U.S. median of $53,000, according to the Census.

Still, Mall of America may be breaking the mold when it comes to the twilight of the American mall. Triple Five is currently working on a $325 million expansion of Mall of America, adding a food hall and underground valet parking. The investment is aimed at pulling in 60 million annual visitors, up from 42 million currently.


Source: Miami Herald

Local leaders broke ground Friday to make way for a new film and television studio in Miami.

Actually, it was more of a demolition ceremony than ground breaking.  A large piece of construction equipment began knocking down an old warehouse to make way for a television and movie production house While it may not be lights, camera, action just yet, the Florida Film & Television Center located at 50 NW 14 Street, is expected to be up and running within the next 15 months.

“The  film industry has always been an important component of the City of Miami’s cutting appeal,” said Mayor Tomas Regalado in a written statement. “The Florida Film & Television Center will continue to move the City forward in the film industry.”

“This will be the very seedling of a very large industry in Miami that will become an oak tree called the film industry,” said City Commissioner Marc Sarnoff at Thursday’s ceremonies. The new studio will house two 15,000 square feet film sound stages with 12,000 square feet of office space, editing suites and accessory rooms.

The lot is meant to hold productions of all sizes including major movies, television series, and independent films. “Domestic and international production companies want to be in Miami and this state-of-the-art facility will go a long way in securing Miami’s status as a top destination for film and television production,” said Commissioner Sarnoff.

EUE/Screen Gems Studios will design, build, operate and manage the studio, which is on a fast-track construction schedule, and expected to be operating within 15 months.  The company will receive some 12 million tax dollars from the Omni Community Redevelopment Agency to finance  construction of the studio.

It is money well spent, according to Omni CRA Director Pieter Bockweg. “From everything that we have researched and studied, the need for film studios is prime right now for this area,” Bockweg said.

Indeed, the groundbreaking comes just a day after a would be studio, set to be near Miami Gardens, won initial approval  for a $10 million grant from Miami-Dade property taxes, according to CBS4 Miami news partner, the Miami Herald.

The spokesman for Miami-Dade Mayor Carlos Gimenez told the paper, the proposed complex, named Miami Ocean Studios  is backed by Gimenez. His administration first recommended $5 million but then upped it to $10 million for the 900,000 square foot facility.

The production and entertainment complex would be on county land  that currently houses three charities — Arc of South Florida, His House, and Center for Family and Child Enrichment. As part of the plan, the county would give money and negotiate a lease for the land located at 20000 47th Ave.  Ocean studios would also have to provide suitable space for the charities on the property or in another spot.

At the ceremonies for the start of the Miami project Thursday, EUE/Screen Gems President Chris Cooney said the message is simple:  Television and movie producers hire lots of people at high salaries and spend lots of money. “They spend the second they hit the ground in the area,” Cooney told CBS4’s Gary Nelson.  “Whether it’s lumber, dry cleaning, caterers, the whole community benefits from that.”

EUE/Screen Gems has a successful track record of operating production houses in New York, Wilmington, NC and Atlanta, GA.  There is a growing trend of producers eschewing high costs in California, and taking their projects to the East and South.

Miami dangled a carrot in front of the production company:  The building. “We provide the facility, they pay the rent, and they pay a management fee as well,” said Sarnoff.  “It’s a win-win for everyone.”

In addition, the company will pay the city 11% of its take.  The CRA’s Bockweg estimates taxpayers could be getting a half million dollars a year within the first few years of the studio’s operation.

Many Shows, True Lies, Scarface, Bad Boys 1 & 2, Bird Cage, CSI Miami and Scarface, to name a few, have been set in Miami but, with the exception of a few scenes, shot and produced in California studios. The last product to be shot and produced entirely in Miami was the now cancelled cable series Burn Notice.


Since its launch in Miami in 2002, Art Basel has been attracting people from all over the world who appreciate innovation and creativity.

Today, satellite events have spread to Wynwood, Midtown, downtown, Mid-Beach and North Beach, and last year about 75,000 people attended the main fair. The first Basel fair featured 160 galleries from 23 countries, attracted 30,000 visitors and has grown and grown and grown — much like our skyline and real-estate industry. The growth and popularity of the event have bolstered the tourism industry and made us one of the fastest emerging cultural epicenters of the world.

For one week in December, all eyes started looking to Miami, including those of some of the world’s greatest architects and developers. Today, they are creating a skyline that is second to none, while Basel brings buyers appreciative of artistic creations. The burgeoning love affair between Miami and art can be evidenced by two recently announced museums: the Institute of Contemporary Art, Miami, the brainchild of Norman and Irma Braman, and the Latin American Art Museum by Gary Nader. Miami was largely a blank canvas in 2002, and so many have seized the opportunity to fill the space with remarkable buildings that are works of art themselves.

In downtown Miami, Zaha Hadid paired with developers Louis Birdman and Gregg Covin for the grandiose 1000 Museum. What was once the famous Bal Harbour Club will become the spectacular, all-new Oceana Bal Harbour, thanks to Italian architect and interior designer Piero Lissoni and developer Consultatio USA. And then there is Herzog & de Meuron, Richard Meier, Norman Foster and Rem Koolhaas, among the many other great names, with others soon to be announced.

Art Basel is certainly a time for businesses to shine. It provides an instant injection of funds into the economy, and the effects of the fair linger long after it leaves town. This is certainly the case for the real-estate industry, which has benefitted greatly from the influx of discerning art lovers. Amid the week of amazing art and all the accompanying events, the glitterati look up and see Miami as a wonderful place to purchase property. And they have many to choose from, for a relatively affordable budget. All are designed by local and international architectural greats who provide a perfect place to display a new piece or two.

Daniel De La Vega, President of One Sotheby's International Realty

Daniel De La Vega, President of One Sotheby’s International Realty

The past week has seen traffic gridlock, long lines and a shortage of restaurant reservations. But as an enthusiastic collector of Latin American art and a member of the Photography Committee at the Solomon R. Guggenheim Museum, Daniel De La Vega, President of One Sotheby’s International Realty, will be sad to see the sun set on the event so soon. Art Basel will continue to play an important role in the growth of South Florida’s real-estate industry and the development of greater Miami as a whole. As a native Miamian, Mr. De La Vega is grateful for how this fair has moved the city forward in so many ways. As the tents come down and the works are carefully packed away, Miamians can still admire innovative and creative pieces all year-round.

All you have to do is look up to the skyline and thank the increased business to the bottom lines.


Source: Miami Herald

Miami-Dade’s debt tax will soar in the coming years, even if voters reject a $390 million borrowing plan for a new courthouse, according to county forecasts.

Without a dollar of new debt for the judiciary, county forecasts show the special property tax that pays for the county’s debt is set to jump by about 50 percent in 2016. That’s thanks to the arrival of new debt that voters already approved for the county-owned Jackson hospital system, as well as rapidly increasing borrowing costs tied to a nearly $3 billion bond program that voters approved in 2004. “I can’t borrow money without having an impact on taxes,” said Ed Marquez, deputy county mayor for finance. “There is no free lunch.”

Currently costing $45 for every $100,000 of a property’s value, the debt tax funds borrowing approved by Miami-Dade voters and generates the revenue behind a wide portfolio of construction projects.  This year it is backing about $1.4 billion in borrowed funds used to create the new Pérez Art Museum Miami, expand county park facilities, build the Miami-Dade police headquarters, dig a tunnel to PortMiami and back hundreds of other projects. It also would allow Miami-Dade to borrow $75 million for an economic-development grant program that Mayor Carlos Gimenez wants to use to provide $9 million for the SkyRise Miami project.

MiamiDadeDebtTaxEven with property values rising more than 5 percent annually, a county forecast shows the debt load will get expensive enough that the tax will need to grow next year to $69 per $100,000 of value. That’s about a 50 percent increase. By 2020, it would cost $84 per $100,000 — about 85 percent higher than it is today. Like all property taxes, the debt tax is technically levied in “mills” per $1 of taxable assessed property value. One mill is one-tenth of a cent. The current debt-tax rate is 0.45 mills, which amounts to 45 cents for every $1,000 of value, or $45 per $100,000.

In an interview, Gimenez said the county’s conservative real-estate forecasts could mean the debt tax won’t have to go up as much as forecast. “Hopefully that tax rate can go down in the future,” he said. “I would like to keep it as low as possible. But it’s how much we borrowed versus what the tax base is.”

Even with the forecast increase, the debt tax would remain a sliver of the average tax bill. The current debt tax rate is one-tenth the size of the general property tax rate of $466 per $100,000, which funds police, parks, social services and other core county services. “It’s kind of a footnote on the tax bill,” said Terry Murphy, a former County Commission staffer now working as a consultant for unions and other groups. “I don’t think anyone pays any attention to it.”

Still, the debt tax is already far larger than the county’s library tax, which is $28 per $100,000 of taxable assessed value. The debt tax also played a role almost five years ago in propelling Gimenez into the mayor’s office.

In 2011, then-Mayor Carlos Alvarez’s budget boosted the debt tax more than 50 percent — from 0.29 mills to 0.45 — in order to combat the sharp drop in revenue brought on by the collapse of South Florida’s real estate market. The move violated a pledge county leaders made in 2004 to keep the rate below 0.40 while campaigning for the $2.9 billion Building Better Communities program. The BBC initiative, passed handily by voters, still accounts for the vast majority of borrowing costs funded by the debt tax.

Gimenez, at the time a county commissioner, joined a minority opposing the debt-tax hike. “It’s important to keep your word,” Gimenez said of the 2004 pledge. When he won election after voters recalled Alvarez in 2011, Gimenez rolled back his predecessor’s tax increases, including a reset of the debt tax to the prior year’s level.

The debt-tax relief didn’t last long. Last year, Gimenez proposed a hike to 0.42 mills as part of a larger tax increase to boost spending on fire, libraries and animal services. Facing a political firestorm, the mayor backed off on the tax-hike push for services, but the debt-tax increase survived. With little fuss, it increased a tiny bit again in the 2015 budget year, which began October 1.

In a recent interview, Gimenez said the real estate crisis and voters’ desire for the BBC projects left Miami-Dade with no choice but to move past the ceiling mapped out during the housing boom. “I’m a low-tax, no-increase kind of guy,” he said. “But I do believe in infrastructure. [It’s] one of the things that separates us from the Third World.”

One reason the debt tax tends to avoid the firestorm that follows even tiny increases in other property taxes is the fact that it pays off debt previously endorsed by voters. And while the county mayor and commissioners decide every 12 months when to borrow the money and where to set the tax, the actual rate is driven by debt incurred in prior years.

On Nov. 4, voters may authorize borrowing up to $393 for a new courthouse. But it would not be until 2021 that commissioners would need to increase taxes by a noticeable amount to pay back the money, according to the forecast prepared by the county budget office.

The $393 million sought for replacing Miami-Dade’s moldy and cramped 1928 civil courthouse with a new facility in downtown Miami is equal to about 25 percent of the tax’s current debt load.

With the forecast debt-tax rates, new courthouse borrowing would, on average, push up the tax an additional 8 percent during the next 20 years — about $5.50 for every $100,000 in value, according to county projections. (Over 30 years, the courthouse bonds would cost an average of $7 for every $100,000 in value, according to the forecasts.) “When you look at the average value of a house, it’s so tiny,” said Katy Sorenson, a former county commissioner now running a Miami-Dade panel overseeing spending on the BBC program. “It’s an investment in the future. It’s for future generations.”

The entire courthouse debt would cost Miami-Dade an average of about $24 million a year to pay back through 2045, according to the forecasts. In all, the payments, with interest, would total $733 million over 30 years.

Ballot items allowing Miami-Dade to incur debt for projects are typically called bond programs, since governments borrow money by selling bonds on Wall Street. Investors make a profit on the interest payments that governments pay bond holders, and those payments come from the debt tax.

Bond payments for Jackson account for about 35 percent of the debt-tax increase in 2016. The rest comes from increased borrowing costs tied to the $2.9 billion BBC program. Without a larger tax roll, Miami-Dade can control the tax only by delaying existing payments or scrapping future borrowing.

Esteban “Steve” Bovo, one of two county commissioners to vote against the courthouse plan, said Miami-Dade shouldn’t minimize the impact of a debt-tax increase. “There’s a reality that the number many of us think is insignificant is significant to others,” he said.

Advocates of the courthouse plan say Miami-Dade’s justice system desperately needs the money to replace the existing facility, which has half the courtrooms needed for all 40 judges and leaks to the point that some areas are closed because of mold contamination. “This is a crisis situation,” said Commissioner Sally Heyman, who joined the majority of the 13-member commission last month to send the courthouse item to voters. “It’s become a situation of: Do we invest in ourselves?”

Of the $393 million sought from voters, about $25 million is slated for repairs to the existing building so it can last the five years needed to build a replacement. Opponents of the courthouse plan say Miami-Dade already has about $78 million available for repairs, and argue the delay should be used to craft a more thoughtful strategy for replacing the current facility.

The $78 million would also come from the debt tax, since the money was earmarked in the original 2004 BBC plan for court facilities. Borrowing it would also contribute to a tax increase, though the extra debt is wrapped into the current county forecasts. “Something has to be done,” said Joseph Serota, a Miami lawyer helping the new-courthouse campaign. “The longer we put it off, the more expensive it is.”

Scattered polling shows the courthouse issue faces an uphill climb with voters, and one challenge is the unusually blunt language that county commissioners inserted into the ballot item. It states that issuing the courthouse bonds means “potentially increasing property taxes.”

The phrase “property taxes” did not appear in the other major bond items passed by voters during the past 10 years. Neither did the concept of any tax actually “increasing.”

The 2004 BBC ballot questions talked of “bonds … payable from ad valorem taxes.” A $1.2 billion borrowing plan for the county school system, which has its own debt tax, asked voters in 2012 to approve bonds “secured by the full faith and credit and ad-valorem taxing power of the district.” The Jackson question last year wanted permission to issue bonds “payable from ad valorem taxes collected in Miami-Dade County.”

Latin for “to the value,” ad valorem is essentially the legalese equivalent of property taxes. All three ballot questions passed easily.

Jorge Luis Lopez, a County Hall lobbyist and a lawyer helping run the courthouse campaign, said the tradition of leaving “property tax” out of past ballot questions made them less challenging to pass. “We’re the first,” he said. “We may have to pay a price for that.”


Source: Miami Herald