By Joseph A. Mann Jr., FloridaBulldog.org
What does sewage in the streets around western Sistrunk Blvd. (NW 6th Street) in Fort Lauderdale have to do with the $195-million Wave Streetcar line being developed for the city?
Plenty, according to Marie “Ms. Peaches” Huntley, neighborhood resident, activist, businesswoman and candidate for commissioner in District 3 of Fort Lauderdale, as well as other critics.
To be precise: A local redevelopment agency set up to improve conditions in poor neighborhoods located around Sistrunk Blvd. – a main east-west thoroughfare in central Fort Lauderdale – borrowed $7.5 million to finance part of the 2.8-mile Wave route that will not serve underprivileged, predominantly African-American communities west of Andrews Ave. Rather, the small section at the north end of the Wave system – called the Flagler Village loop — will provide the new service to residents three blocks east of Andrews Ave. along Sistrunk, in the middle-class Flagler Heights (Flagler Village) neighborhood, and points south.
“That $7.5 million in trust fund money could have been used to improve conditions for people living in neighborhoods west of the [FEC] railroad tracks,” Huntley told Florida Bulldog. She is president of Home Beautiful Park Civic Association (HBPCA), one of the underprivileged neighborhoods west of the tracks, and CEO of On Call Leadership Inc., a non-profit that mentors and works with disadvantaged youth.
“When it rains, we have raw sewage bubbling out into the streets, and kids are playing in the streets around their houses,” she said. “You’d think that they [city officials] would pay more attention to the needs of their people.” Aside from a new sewage system, the funds could have helped provide affordable housing, improve local public transportation or create training and job opportunities, among other things, Huntley and other critics say.
The local government entity borrowing the money for the Wave was the Fort Lauderdale Community Redevelopment Agency (CRA), which covers three areas, including the Northwest-Progresso-Flagler Heights neighborhoods along Sistrunk Blvd. The other two areas in the Fort Lauderdale CRA are Central Beach and Central City.
Two sides of the railroad tracks
While the Northwest CRA clearly includes Flagler Heights, this attractive neighborhood and new apartment buildings stand in sharp contrast to the rundown areas on Sistrunk Blvd. a few blocks west.
The CRA decision to finance part of the Wave streetcar line project with $7.5 million of its own funds came about three years ago. But the issue gained public attention earlier this year, when opponents of the Wave tried to stop the project before it was approved 6-3 by the Broward County Commission in June.
In effect, the CRA took out a $7.5-million loan and has assumed the obligation of repaying it at a cost of $870,000 a year in debt service (interest plus principal) over 11 years.
The CRA’s chairman is Fort Lauderdale Mayor John P. “Jack” Seiler and its executive director is City Manager Lee Feldman. Other top city officials also are executives at the CRA, whose purpose is to eliminate slum and blight in its three areas of responsibility.
Huntley pointed out that she favors more and better public transportation in Fort Lauderdale, but that current transit plans are not equitable in terms of serving residents of poor and black neighborhoods, the people who rely the most in public transit.
People living in the HBPCA — Zip Code 33311 – depend heavily on public transit to reach work, she said. Moreover, nearly 40 percent of residents live in poverty while many are old, ill and disabled. They can’t afford taxis or Uber and need accessible and reliable public transportation in addition to the Broward County buses, the Sun Trolley (free) and community transport that now serve parts of the area.
Huntley has sent letters to city and county transportation officials demanding investigations into the equity of the city’s public transportation system, and complained that poor neighborhoods like hers are obliged to subsidize the Wave Streetcar line and Sun Trolley bus systems (the Sun Trolley runs along part of west Sistrunk Blvd.) while receiving fewer benefits than other parts of the city.
She also said that her association was told the Wave system to be built on the other side of the railroad tracks “would most likely never reach us.’’ Other voices criticized the city’s decision to grab $7.5 million in CRA funds for the Wave.
Planners considered extending the Wave along western Sistrunk Blvd. but decided “there was not enough [population] density to warrant the cost and potential liability issues crossing the FEC tracks,” Scott Strawbridge, a former builder, member of the Northwest CRA advisory board and a frequent critic of the CRA’s decisions, told Florida Bulldog.
“Northwest has been ignored”
“When you stand on the railroad tracks at Sistrunk and Andrews Ave., your feet are on two different worlds,” Strawbridge said. “The CRA is supposed to build affordable housing and ameliorate blight. In my opinion, the northwest has been ignored.” He also said using $7.5 million for the Wave was “a violation of the [CRA] trust fund agreement.”
“The biggest problem is that you’re taking money from a community in need of economic revitalization to benefit big business on the east side of the tracks,” Dale V. C. Holness, Broward County commissioner for District 9, told the Bulldog. People living in the Northwest CRA area, which is part of the commissioner’s district, “need better public transportation and have been paying taxes but aren’t getting anything back from this. I support business but some rich developers [in the east] are getting money from the Wave at the expense of poor people. The city needs to change its ways and finds ways and means for helping small business in the northwest community, creating better public transportation, affordable housing, training and apprenticeships and contracting opportunities,” he said.
“There is a dire need for public transportation that goes east to west along the Sistrunk corridor, and the Wave goes north-south,” said Frank Schnidman, who recently retired as Distinguished Professor of Urban and Regional Planning at Florida Atlantic University and is a consultant and expert on CRAs. In contracting the loan for $7.5 million, the Northwest CRA “took slum and blight money for something that wasn’t in the redevelopment plan” and used it for the Wave project, Schnidman told the Bulldog. The city later amended the plan to include the loan, he said.
“This is reverse Robin Hood,” he said. The Wave will benefit Flagler Village, a gentrified community east of the tracks, and the developers who have properties in that area.
A 600 square-foot apartment in Flagler Village can rent for about $1,800 to $2,000 a month, far beyond the reach of most Sistrunk residents living a few blocks to the west, Strawbridge said.
“CRAs are a pot of money the city can use for popular projects, without raising taxes,” Schnidman said. In addition, the CRA can assume new debt on its own, while the city would need a referendum to contract debt of more than 12 months.
“All of the money spent to date on the Sistrunk corridor, and look at it today,” he said. “It makes you want to cry.”
Responding to questions from Florida Bulldog, Fort Lauderdale spokesman Chaz Adams said in an email that the decision on the $7.5-million loan was made “to advance the goals and objectives encompassed in the community’s shared visions, to enhance connectivity, and begin implementing transportation alternatives that move away from moving vehicles and moving toward moving people.”
Adams also said that the CRA charter was not changed to borrow money for the Wave’s northern loop and that “outside counsel” reviewed the documents related to the loan before the debt was incurred.
“Investment in transportation has been undertaken for many years in the CRA, including subsidizing the operating costs of the Sun Trolley,” he said.
As for Huntley’s criticisms, Adams said: “The city is in the process of working with Ms. Huntley and other community members” to address their concerns.
The Wave streetcar line
In the meantime, the Wave is making progress.
Under study for about 15 years, the Wave Streetcar plans to start construction early next year. It will have 14 stations linking SE 17th Street to NE 6th Street (Sistrunk Blvd.) and Andrews Ave. Wave cars will run on embedded rails and will be powered by overhead electrified cables.
Florida Department of Transportation is the lead for the Wave’s construction phase, and Broward County Transit will own and operate the system when it goes in to service, now projected to be in 2021. According to current estimates, it will cost the county more than $6 million a year to operate the Wave. Fares and advertising are not expected to cover these costs.
The project is in the procurement stage for a construction contractor (four firms shortlisted), and the winner will be selected in late October, according to the Valerin Group, a communications firm responding to questions for FDOT and BCT.
Siemens has already been chosen to supply five S70 streetcars for an estimated $30.2 million. The acquisition is being done under a “piggyback” option, using the existing contract between Siemens and the Charlotte Area Transit System as a model.
The total price tag for the Wave will be more than $195 million, with about $144 million going to construction, streetcars, other equipment and infrastructure upgrades along the route, and $51 million for planning, project development and other services. About $20 million has already been spent over several years on planning, project development, environmental studies and project design, Valerin said in response to questions emailed by the Bulldog.
The Wave website says that a compete funding plan is in place, including federal, state, county and city monies ($7.5 million from the Northwest CRA is in the last category), as well as property tax assessments that have been collected for two years. However, the full federal component (more than $82 million) will depend on the new budget to be approved by the U.S. Congress.
The Wave is a highly controversial project. Supporters, like the Downtown Development Authority and some developers, say it will provide a valuable new source of public transportation to central Fort Lauderdale, promote over $3 billion in real estate investment and growth in the downtown area, generate short- and long-term jobs, plus important upgrades to infrastructure along its route, including improvements in the 3rd Avenue bridge and aging water systems, new sidewalks, crosswalks and street lighting.
Opponents say that the project is far behind schedule and will not relieve traffic congestion (even the Wave says it will have “a minimal impact on traffic”). They also say that its cars are slow and use old technology, overhead wires will come down during hurricanes, its route is not useful for many downtown travelers (certainly not for Sistrunk west of the tracks), it would be cheaper and more efficient to add buses, and it will lose money. Some developers with properties along the Wave route stand to benefit the most, they say.
In a city that needs more mass transportation, the Wave remains a controversial project even as it moves ahead. For example, when the Broward County Commission approved the project in June, there were misgivings, even from a supporting vote. According to the Sun-Sentinel, Commissioner Steve Geller (District 5), who voted in favor, said: “I am concerned we are spending a lot of money on something I think could be addressed better and much cheaper through basically shuttle buses. I am concerned that we may have gone so far that if we pull back now, that we would have problems with our credibility with both the state and federal government.”
Commissioner Nan Rich (District 1), who voted against the Wave, was concerned that spending $6 million a year to operate and maintain the system will use taxpayer dollars needed for other priorities, according to the Sun-Sentinel article. “I just feel like this is a black hole, and we’re going right down it.”
What is a Community Redevelopment Agency (CRA)?
The original concept behind CRAs was sound. Florida legislation approved in 1969 allows cities or counties to create CRAs to alleviate slum conditions, blight and a shortage of affordable housing in a particular area.
CRAs operate as separate legal entities. But in many cases, like that of Fort Lauderdale, the city commission heads are the CRA’s board of commissioners, the decision makers. There are 13 CRAs in Broward County.
CRAs receive funds from a percentage of increases in property taxes – called TIF or tax increment financing — within the redevelopment area.
On its website, the Fort Lauderdale CRA states that its mission is “to positively impact the quality of the residents” in its three geographical areas. It “works to orchestrate orderly and progressive business development initiatives, encourage the production of affordable housing, invest in critical public improvements, and provide community-building activities such as, but not limited to, events, meetings, and seminars for the advancement of business and economic development,” the website says.
The Northwest CRA’s budget for FY2016 was reported at over $9.4 million, with more than 62 percent going to capital projects, about 15.5 percent to services and materials and about 8 percent to salaries, wages and fringe benefits.
It has invested in a wide variety of projects in the Northwest, Progresso and Flagler Heights neighborhoods, including improvements in facades, streetscapes, small business incentives and grants, as well as technical assistance to small businesses, the CRA website says.
Indeed, western Sistrunk Blvd. is a nicely-paved street running through a crazy quilt of neighborhoods with vacant lots, new and old businesses, uncollected trash and a mix of modest, well-kept homes and a large number of rundown housing units.
While regional CRAs undoubtedly have contributed to improvements in underprivileged neighborhoods with millions of dollars in spending, decision-making, operations and controls at many of these organizations have been flawed, criticized and investigated for misuse of public monies, according to reports issued by the Fort Lauderdale city auditor and a Miami-Dade grand jury.
Things are a mess
For example, the Fort Lauderdale city auditor conducted an operational audit of the city’s CRA at the request of the City Commission and said, in the main conclusion of its October 2016 report, that “the City and CRA lack adequately designed controls to prevent and detect errors in budgeting, procurement and compliance with relevant statutory requirements in a timely manner.” This is auditor-speak for “Things are a mess.”
In the Northwest CRA, the auditor pointed to the improper use of $22,000 in CRA funds for a city employee retirement party and a farewell event for a commissioner, failure to complete projects within the stipulated timeframe and a host of other irregularities.
The auditor made a broad range of observations and recommendations to the city. With regard to criticism of the Northwest CRA, the city said it had changed its management, strengthened controls and would reimburse the CRA for improper expenses noted in the report.
Adams, the city’s public affairs spokesman, said in an email that Fort Lauderdale officials have reviewed both the auditor’s report and that of the Miami-Dade grand jury “and have made the appropriate adjustments to the CRA.”
The audit came after Florida Bulldog reported in February 2015 that $1 million in taxpayer loans to a key CRA project aimed at revitalizing the Sistrunk Blvd. corridor – the 23,000 square-foot Sixth Street Plaza –were in jeopardy due to the forced sale of the plaza. The project filed for bankruptcy later that year.
The office and retail complex was financed with taxpayer dollars and the city controller sharply criticized the CRA’s management of the project, saying it could not determine how more than $900,000 was spent.
Writing for the Florida Politics website earlier this year, Richard Corcoran, Speaker of the Florida House of Representatives, supported legislation for statewide reform of CRAs. He said that CRAs in Florida “reported almost $600 million in revenue, $605 million in expenditures and $715 million in debt in 2015. Also, between 2005 and 2015, CRAs issued $1.35 billion in bonds. We literally cannot afford CRAs.”
Moreover, “A Miami-Dade grand jury report in 2016 said that the CRA appears to be a fund for pet projects and is flirting with ‘slush fund’ status,” Corcoran noted. He added that many CRAs are governed by boards “that mirror or are very similar to the local government that oversees the CRA,” and that friends of board members sometimes improperly benefit from CRA spending.