Tired of problems, Fort Lauderdale audits its community redevelopment agencies

By William Gjebre, FloridaBulldog.org cralogo

Fed up with project failures, management problems and possible city overcharges, Fort Lauderdale commissioners have ordered an extensive audit of the city’s Community Redevelopment Agencies.

In a little-noted action, commissioners directed the audit of three CRAs at a conference meeting earlier this year.

The audit was triggered by the million-dollar failure of the Sixth Street Plaza project. Some commissioners expressed additional concerns about the findings of a city auditor’s report on CRAs that they said indicate the city had unfairly overcharged the CRAs for services during the past five years.

Commissioners ordered “a full audit” of the Northwest/Progresso/Flagler Heights (NWP) Community Redevelopment Agency, the Central Beach (CB) CRA and the Central City (CC) CRA, City Auditor John Herbst said in an interview. He said the audit, now under way, may be completed in two months.

Herbst said the audit was undertaken because the city wants to get in front of the matter, knowing the Broward Inspector General’s Office has been investigating CRAs around the county for some time.

Herbst said he expects the audit to determine whether CRA spending was “in compliance with state law and CRA bylaws,” and whether the CRAs were properly managed and contracts adhered to the CRAs’ limitations.

“We want to make sure money was spent in accordance with governing legislation,” Herbst said. The audit will cover the past three years – a reasonable time period, the auditor added.

Fort Lauderdale Commissioner Robert McKinzie

Fort Lauderdale Commissioner Robert McKinzie

Herbst said the troubled Sixth Street Plaza project is a key factor in the ongoing audit. Last May, the city auditor’s office criticized the CRA for poor oversight of a taxpayer-supported office and retail plaza that was to be the centerpiece of the city’s ambitious plans to revitalize the Sistrunk Boulevard corridor.

But the 23,000-square-foot building at 900 NW Sixth St. filed for bankruptcy, jeopardizing the repayment of $1 million in taxpayer loans.

Following that finding, Vice Mayor Robert McKinzie’s staff asked Herbst in a memo to conduct “a complete audit of the day to day operations of the CRA.” Herbst said Mayor Jack Seiler and his fellow commissioners backed the call for the audit in a consensus vote during a city commission conference meeting in January.

‘Inconsistent leadership’

Herbst said the city’s CRAs have had problems because of frequent management shuffling. “There was inconsistent leadership due to transfers,” he said.

A report by his office noted that the Northwest/Progresso/Flagler Heights CRA, in a less-affluent area, was charged $1.7 million for city services over the past five years, while the Central Beach CRA, in a wealthier area, was charged $909,000 during that same period.

The finding upset City Commissioner Dean Trantalis, who said an “excessive amount of money is charged for administration, denying the neighborhood that is suffering blight and neglect and so much money being used for staff.”

Fort Lauderdale Commissioner Dean Trantalis

Fort Lauderdale Commissioner Dean Trantalis

Trantalis said he has asked City Manager Lee Feldman about correcting CRA allocation issues, but “he hasn’t been responding. We need to change the practice. We discovered that the city manager, to shore up the budget, has been attributing staff time to the CRA.”

Feldman did not respond to requests for comment before deadline after promising to make himself available for an interview.

At the city commission meeting in January, others expressed their concern about the auditor’s findings.

Minutes of the meetings say McKinzie “questioned why such a large portion of funds was allocated [to] the [Northwest/Progresso/Flagler Heights] CRA for administration and resources when the CRA did not have a director.”

Commissioner Bruce Roberts suggested the matter be referred to the State Attorney’s Office or some other investigative agency for a criminal probe.

“Many feel CRA funds have been drained for administrative services, and there is a lopsided disparity,” Trantalis said at the January meeting. The mayor and the city’s four commissioners also serve as directors of the CRAs.

Problems found

Herbst’s audit report mainly delved into the current fiscal year salary allocations of the two CRA offices, Northwest/Progresso/Flagler Heights and Central Beach. But it found problems.

“The method used to allocate personnel costs may lead to excessive General Fund expenses being allocated to the CRA, a violation of Florida Statute 163.370(3)(c),” the report stated. The state provision prohibits the tax-increment funds that CRAs receive from covering general government operating expenses unrelated to planning and carrying out a CRA plan.

The report goes on, “We determined that the Department of Sustainable Development (DSD) and the Budget Office were not able to provide adequate support for the percentages used for personnel cost allocations to/from the CRA fund and the sub-funds. Additionally, they are allocating charges to the CRA for personnel positions which are vacant for either a portion of the fiscal year or the entire fiscal year.

“The budgeted allocations are then charged to the CRA throughout the year without reconciling those estimates to actual costs incurred, resulting in an excess of allocation over actual cost,” according to the report.

The faulty allocations can negatively impact the CRAs’ ability to achieve their goals, the report aid.

The city charged the CRAs for hours city employees spent working on agency matters.

In one instance, the report said the Northwest/Progresso/Flagler Heights CRA was “overcharged” $30,000, which should have been charged to the Central Beach CRA. That happened after an employee was promoted from assistant to the city manager to the position of economic and business development manager in charge of the Central Beach CRA. For three months, he was paid from funds allocated to a vacant position in the Northwest/Progresso/Flagler Heights CRA, the report said.

A correction was later made, but “the prior overcharging was not corrected timely” and ate into how much funding was available to meet the CRA’s goals.

Since the report, the city has begun making changes.

Trantalis said in an interview that city commissioners have removed the CRAs from reporting to the Department of Sustainable Development and made them separate entities with their own managers to oversee day-to-day operations. State law requires CRAs to operate independently of other departments.

City Manager Feldman, however, will continue to function as executive director of the CRAs.

Other changes call for improved financial oversight from the city finance director and the city auditor, identifying a separate CRA funding and accounting structure, and allocating additional funds for the two CRAs to implement changes during the current fiscal year.

Fort Lauderdale to use “poor people’s money” to subsidize transit for affluent?

By William Gjebre, FloridaBulldog.org 

A rendering of Fort Lauderdale's proposed WAVE streetcar. Will tax dollars intended to eliminate slums be used to pay for it?

A rendering of Fort Lauderdale’s proposed WAVE streetcar. Will tax dollars intended to eliminate slums be used to pay for it?

Fort Lauderdale’s recent approval of a no-bid contract to update the plan for the troubled Northwest-Progresso-Flagler Heights Community Redevelopment Agency has raised concerns about a lack of public input amid a rush to add projects not in the current plan at the expense of community needs.

Scott Strawbridge, who serves on the CRA’s 14-member advisory board, has called for outside review of the agency after he and his colleagues were informed that City Manager Lee Feldman signed a $24,500 contract with a private firm in August to amend the current CRA plan, last updated in 2001.

Pompano Beach-based Redevelopment Management Associates LLC has already begun the first phase of the work. Under city code, the city manager has authority to enter into contracts up to $25,000, without seeking approval from the CRA board.

“The city is trying to push through a short term process that should take a longer review,” said Strawbridge, adding there needs to be more data to support any proposed changes. “I think it would be healthy for the public to understand what has been spent…There should be accountability.”

Except for one informational hearing on Sept. 23 about the Redevelopment Management firm’s study, there has been little public notice and input, Strawbridge added.

Frank Schnidman, a Florida Atlantic University professor recognized as an expert on legal issues regarding CRAs law, said state statute makes “clear if projects are not in the plan then it’s inappropriate to use tax increment” CRA funds to pay for them.

By law, the mission of CRAs is to clean up slum and blight. Schnidman said the Northeast Progresso-Flagler Heights CRA apparently is considering funding transportation projects not currently in the plan. But even if they met the legal requirements for CRA funding “they would not alleviate slum and blight…They would be using poor people’s money to subsidize transit for people living in more affluent areas.”

“This would be another manipulation of tax money,” Schnidman said, adding the funds would be better used for “affordable housing, where there is a crisis. Poor people would be left out in favor of politically favored projects, like the Wave,” a proposed streetcar system primarily servicing the downtown area.

Fort Lauderdale City Manager Lee Feldman

Fort Lauderdale City Manager Lee Feldman

City Manager Feldman, who also serves as executive director of the CRA, and Jeremy Earle, deputy director, of the city’s Sustainable Development Office, did not respond to requests for comment.

However, city spokesman Matt Little noted in an e-mail response that the CRA budget includes funding for the WAVE, “as approved by the CRA Board.” He also said the budget may include “a line item” subsidy for the existing Sun Trolley system, if the project is contained in the Plan, but did not clarify if that was the case or not.

The CRA’s plan is being updated because it hasn’t been amended for 11 years, and changes could allow for the enhancement of transportation, provide support for community events and give the CRA Board flexibility to consider other proposals that may be presented, the spokesman said.

The concerns follow a problematic city auditor’s report in May that castigated the Northwest Progresso-Flagler Heights CRA for its poor oversight of a taxpayer-financed office and retail complex, Sixth Street Plaza, which filed for bankruptcy last spring.

“The project lacked fundamental project discipline, from risk assessment and establishing proper governance to detailed accounting of funds disbursement,” City Auditor John Herbst wrote in a cover memo to the city commission, which also sits as the CRA’s board of directors.

The city commission requested the report after FloridaBulldog.org reported in February that taxpayer loans were in jeopardy due to the forced sale of the plaza.

Strawbridge, an official with the Fort Lauderdale Housing Authority, stopped short of naming the agency that should look into NPF’s spending practices. But the Broward Inspector General’s Office has kept close tabs of municipal CRAs in recent years.

Last year, for example, the Inspector General found the Margate CRA deliberately mishandled $2.7 million in funds by rolling the money over for several years without specific purposes. In 2013, it determined that the Hallandale Beach CRA had $2.2 million in questionable expenditures.

Two years ago, the Florida Auditor General cited the Hollywood Beach CRA for failing to report $36.2 million in unspent year-end funds from 2009-2010 and $34.2 million from 2010-2011. The city is now considering options that would redirect funds intended for the CRA to the city.

The proposed route of Fort Lauderdale's WAVE streetcar

The proposed route of Fort Lauderdale’s WAVE streetcar

Strawbridge said the Northwest Progresso-Flagler Heights CRA is seeking to revise the existing plan to add projects for funding consideration that are not included in its existing plan, even as the new fiscal year began Oct. 1.

According to city documents, CRA officials expect Redevelopment Management Associates to present an outline of proposed changes at the end of November, and to city commissioners for approval in December. The company, formed in 2009 and run by redevelopment consultants Kim Briesemeister and Chris Brown, pitches itself as a way to help cities “reinvent” themselves to attract businesses, jobs and revenue.

The CRA budget for the new fiscal year of 2015-2016 will likely include funds for transportation projects not in the existing plan, Strawbridge said.

He cited two memos from Feldman to commissioners. One outlined an extension of the proposed $50 million WAVE streetcar to a portion of the Northwest Progresso-Flagler Heights area at a cost of $7.5 million. The CRA would make an anticipated annual payment of $870,000, for up to 11 years.

The other memo called for the CRA to pay $197,000 to offset operational expenses for the existing Sun Trolley system in the CRA area.

In the past, the CRA has also funded neighborhood street parties, giving one group up to $142,000, Strawbridge said. He questioned whether that was a proper expenditure under a previous opinion by the Florida Attorney General’s Office, which opined that CRA funds should be used for “bricks and mortar” projects.

How many railroad crossings will close for new downtown passenger train service?

By Ann Henson Feltgen, BrowardBulldog.org allaboardflorida

New downtown passenger train service that will speed users from Orlando to South Florida and back may sound like a tourism dream come true, but there’s a potentially unexpected cost to local residents.

Local governments face increased costs to maintain the areas where their roads cross the tracks and some fear the closing of smaller crossings to vehicular traffic to save money.

Elizabeth Fulford lives west of Broward General Hospital and believes if crossings are closed, “it may turn into a life or death issue.”

“I am very concerned about the road closures. What happens if I need an ambulance and trains are blocking the tracks?” she asked.  “If they close the smaller crossings, how will this affect the police and fire” in their ability to quickly get to the scene?

So far, plans have been announced to close several streets in Fort Lauderdale and West Palm Beach to make way for new train stations on land owned by the developer, All Aboard Florida. Downtown Miami is also slated for a new station; however, company officials say no road closures have been planned at this time.

“We are working with the city staffs to determine the appropriate traffic mitigation measures, like perimeter roads,” All Aboard Florida staff wrote in an e-mail.

HIGHER COSTS, MORE CLOSINGS?

But more crossings could be earmarked for closure if municipalities along the Florida East Coast Rail line balk at paying increased maintenance costs that could total between $6,000 and $8,000 per year per crossing, said Paul Calvaresi, transportation planner with the Broward Metropolitan Planning Organization (MPO).

In all, there are 68 crossings in Broward.

All Aboard Florida, a project of Florida East Coast Industries (FECI), is seeking a federal loan for the $1.5 billion needed to upgrade its tracks and purchase other infrastructure. The company will build train stations in Miami, Fort Lauderdale and West Palm Beach. Gov. Rick Scott recently pledged up to $215 million in state money to build a new Orlando rail station that would serve All Aboard Florida. FECI Executive Vice President Jose Gonzalez promises a three hour ride from Miami to Orlando.

Jose Gonzalez, executive vice president of Florida East Coast Industries, the parent company of All Aboard Florida Photo: Ann Henson Feltgen

Jose Gonzalez, executive vice president of Florida East Coast Industries, the parent company of All Aboard Florida Photo: Ann Henson Feltgen

“The [passenger] trains will average 79 miles per hour overall speed,” Gonzalez said. He added that speeds will be higher, up to 110 miles per hour, in rural areas. Freight trains operated by FECI affiliate Florida East Coast Railway will travel along a second set of tracks, which will be restored, on the old Flagler Railroad bed at slower speeds, he told the Fort Lauderdale City Commission during its conference meeting on April 1.

“We plan to run 32 [passenger] train trips on the tracks from 6 a.m. to 9 p.m. per day. The 14 freight trains will eventually be moved west,” to the state-owned tracks currently used by the Tri-Rail, he said.

That’s 16 round trips a day. All Aboard Florida’s website says it expects that about three of every four of its future customers will be leisure travelers, “whether that’s a couple taking a weekend trip, or a family of four visiting from an international destination.” It cites a 2012 ridership study found that people take more than 50 million trips between South Florida and Central Florida.

More than 350 roads cross the tracks between Miami and Cocoa, at which point the train will turn west to Orlando. Each crossing that remains open requires safety upgrades, which Gonzalez said his company would pay.

But the municipalities who control the roads will have to come up with funding for enhanced safety measures to create “Quiet Zones” where trains are to refrain from blasting their horns at every crossing.

Train horns produce a sound level of 110 decibels (human conversation is about 60 decibels, with the sound level doubling at 10 decibel intervals). Conductors normally must sound the horns for at least 15 seconds before each crossing, but in Quiet Zones the horns are mounted on the crossing gates to reduce the range of the noise.

A preliminary estimate for Broward County’s upgrades comes to $13.75 million for its 68 crossings, according to Broward’s MPO. The costs are to pay for beefed up gates, vehicle detectors, sidewalks, medians, additional lights and gate-mounted horns.

“Quiet Zones affect the train horn only,” said Broward MPO planner Paul Calvaresi. “They do not minimize the vibrations made by the train. And if conductors hear of danger ahead, they will sound the train horn.”

AN EARLY STUDY ON POSSIBLE CLOSURES

Calvaresi and James Cromar, the MPO’s director of planning, are working on behalf of Broward and Palm Beach counties with All Aboard Florida. When the project started, they conducted a study.

“We looked at the 68 crossings in Broward County and made a list of where quiet zones would be most needed if funding was limited,” Cromar said. Palm Beach County’s 114 crossings also were studied

They recommended that 41 crossings in Broward not be upgraded for Quiet Zones to save costs. They included:

• Nine crossings in Fort Lauderdale between Southwest Fifth Street and Southwest 24th Street;

• Six crossings in Oakland Park from East Commercial Boulevard to Oakland Park Boulevard;  

• Seven crossings in Dania Beach from Griffin Road to Sheridan Street; and

• Eight crossings in Pompano Beach from Northeast 48th Street to State Road 811/Dixie Highway.

“We got quite a bit a push back from the cities about that list,” Cromar said.  The draft plan was scratched and the planners began looking for ways to fund all of the crossings in Broward and Palm Beach counties, with Florida Department of Transportation working up the cost estimates.

All Aboard Florida officials concede that some additional crossings will be closed but say those decisions are local and have not been made.

Hollywood does not plan to close any of its railroad crossings at this time, said Raelin Storey, director of public affairs and marketing.

All Aboard Florida “requested us to look at different crossings that could be closed but we are not of the mind to do this as it doesn’t make sense for our residents,” she said.

Fort Lauderdale City Manager Lee Feldman said All Aboard Florida has not asked his staff about closing any crossroads other than Northwest Second Street.

“I don’t expect that they will ask,” he said. “But, we would look at them individually.”

APPLYING FOR FEDERAL GRANTS

The Broward MPO is in the process of applying for a Transportation Investment Generating Economic Recovery (TIGER) grant for Broward and Palm Beach counties. The grant provides funding nationwide for road, rail, transit and port projects that encourage economic recovery. The grant would pay for the increased safety equipment at crossroads in the Quiet Zones.

Grantees must provide a 20 percent non-federal match, according to the agency’s website, and no more than $150 million can be awarded to projects in a single state. The grant pool for 2014 is $600 million. The deadline to apply is April 28.

Even if the full grant amount is awarded, some crossings may close, Broward’s Calvaresi said.

“With Quiet Zones comes additional safety and maintenance costs,” he said. “The municipalities must pay those costs and they might determine the costs are too high and close the crossing.”

Streets already set for closure are Northwest Second Street in Fort Lauderdale.  Crossings on Datura and Everinia streets in West Palm Beach also will close. In Fort Lauderdale a new perimeter road will run around the station.

Miami-Dade County, which has only 13 miles of track, has not taken up the issue yet, said Wilson Fernandez, transportation assistant manager for the Miami-Dade County MPO.

“We intend to bring this up but we have a different situation,” he said. “We have a different order of magnitude and more  opportunities to be able to get this done” on their own. He added that approval for the train station in downtown Miami is going through the county approval process.

The Treasure Coast Regional Planning Council is also seeking funding for the three other affected counties under its jurisdiction – Martin, St. Lucie and Indian River counties. Kim DeLaney, strategic development coordinator, said they are taking a different route.

“We are asking the legislature for a $10 million appropriation to offset costs,” DeLaney said. “We don’t have as many crossings and because the train speeds will be higher, more safety infrastructure will be required” in the upgrades.

Because All Aboard Florida’s parent company is seeking a federal loan for the project, an Environmental Impact Statement study must be conducted. The study looks at the project’s significant affects on the environment.

The document is expected to be available in mid-May, according to Gonzalez. A series of up to six public meetings along the rail corridor will be held and public comment can be provided at the workshops, in writing or by email.

SAFETY SHORT-CUTS?

Meanwhile, an engineer with the Federal Railroad Administration is concerned that All Aboard Florida is short-cutting safety requirements in 57 rural areas north of Palm Beach where the passenger trains run at speeds between 110 and 125 miles per hour.

A report by Engineer Frank A. Frey said such high-speed railroad crossings should be completely sealed off so that no vehicles can get onto the tracks when the crossing bars are down. In fact, he said federal guidelines require it.

Yet his report notes that All Aboard Florida officials oppose the sealed corridor idea, saying it is a suggestion, not a requirement, and arguing that such added safety measures would cost the company an additional $47 million.

“They are not exercising appropriate safety practices and reasonable care when designing for high speed passenger rail service,” he said.

Fort Lauderdale draws up vision for the future

By Ann Henson Feltgen, BrowardBulldog.org fortlauderdale

Within the next few months, if city commissioners approve, Fort Lauderdale residents will have the option of receiving and paying their bills for city services online. The savings in postage and personnel will be used to purchase shade trees for residents who use the online pay system, or be placed elsewhere around the city.

That’s one proposed outcome of a new plan, called Vision Plan 2035, offering residents’ views of what the city should become.

Many who spoke up said they wanted “more walkability and bikeability, getting out of the car and into more public transit and other alternatives,” according to Susy Torriente, the assistant city manager who is overseeing the Vision Plan.

Shade trees are an important part of the budding plan – intended to encourage people to get out and walk or bike. Residents who opt to use online billing will be first in line to get them if they choose.

“There are ways to get things done,” said City Manager Lee Feldman, who envisions a tree canopy all around the city. “We can come up with solutions without increasing the budget.”

Commissioners will get a look at the Vision Plan’s survey results during today’s (Feb. 19) meeting at 1:30 p.m. at City Hall.

The full plan is to be presented to the commission for its consideration on April 16.

This isn’t the first time community members have been involved in the city’s long-range planning. In the 1980s, such plans were drawn up in advance of development of the Riverwalk complex and the Museum of Discovery and Science.

Today’s long-range planning effort began as a citizens’ initiative in 2008 led by a local discussion group headed by former Mayor Robert Dressler. Dressler, who served as mayor from 1982-1986, runs The Fort Lauderdale Forum.

Former Fort Lauderdale Mayor Robert Dressler

Former Fort Lauderdale Mayor Robert Dressler

In the spring of 2009, a proposal to create a new plan was presented to the city commission, which appointed an eleven-member “Visioning Committee.”

“Called ‘Our City, Our Vision,’ the process aims to determine what our citizens want Fort Lauderdale to be in 2035, and a specific goal has been to reach out to citizens not normally involved in city government,” Dressler wrote in a recent article for CityView Newsmagazine.

In early 2011, the commission hired the Philadelphia-based planning firm Wallace, Roberts and Todd to complete the first phase of the project – public outreach. The firm was paid $55,000.

The commission had approved another $250,000 for the contractor to complete the remaining two phases, but after Feldman was hired a few months later he decided to save money and take the planning in-house. Feldman’s budget for the remaining work is $42,000.

Both Feldman and Torriente have extensive experience with long range city planning. The city’s planning department also contributed.

VISION PROVIDES FRAMEWORK

Through a variety of methods, residents and city staff discussed the challenges and opportunities the city will face in coming years and came up with a framework for what residents would like to see happen.

From there, it is up to the city to develop innovative projects and funding, such as online bill paying to pay for shade trees. Another project that fits under the Vision Plan’s transportation component is already underway – linking rapid transit with trolleys and the WAVE streetcar to help lessen the number of cars on the roadways.

The Visioning Committee conducted a survey that collected more than 1,500 comments that amount to a “wish list” from residents across the city.

For the plan to work correctly, Feldman said, every city project should fall within the vision.

“If they don’t, I will recommend to the commission that they are contrary to the vision,” he said.

The survey was conducted using one-on-one interviews, town hall meetings and local summit groups.

“This allowed as many people to participate as possible,” said Torriente.

A recent Downtown Walkability study for downtown Fort Lauderdale, paid for by the Broward Metropolitan Planning Organization, the South Florida Regional Transportation Authority and others, offers specifics for how to encourage people to get out of their cars.

For example, the study noted that people need a reason or destination to walk to, using a safe, comfortable and interesting route. To provide those elements, the report suggested that walking routes be lined with shade trees rather than palms, and that roads be narrower, which can be accomplished by a low-cost method of new striping that narrows lanes and slows down cars.

“The Vision Plan is an aspirational message for 2035 not necessarily linked to one project or one thing,” Feldman said. The study with its specific suggestions fits into the Vision Plan nicely and is an example of where project ideas can come from, he added.

Fort Lauderdale City Manager Lee Feldman

Fort Lauderdale City Manager Lee Feldman

The city’s five-year strategic plan outlines specific projects within that time period and the city’s annual plan dictates when the project will be done and how it is funded.

PLAN INTRODUCTION MET WITH NAYSAYERS

The Vision Plan has had detractors. According to Vision Committee chairman Randall Vitale, an executive with Gibraltar Private Bank and Trust, complaints surfaced when the city hired consultants to do the work.

“It was felt that they were out-of-town consultants who didn’t know the community,” Vitale said.

There were also objections about the cost, but those dissipated after the project was brought in house.

City resident Dennis Ulmer attended the most recent Vision Committee meeting last week and said that while he supports the Vision Plan, the committee needs to better consider how global warming will affect city projects, such as putting utilities underground.

Even Feldman said the plan is not without pitfalls.

“The plan could get so aspirational that it’s not achievable,” Feldman said.

PLAN TIMING IS STRATEGIC

Supporters say the strength of the Visioning Plan is that it sets a destination for the city – a roadmap to the future.

Feldman said the Vision Plan would not become another public document that sits on a shelf. Instead, he says he will measure city performance against what is in the plan.

“We’ll be talking about ‘this is our vision, this is where we are, let’s develop priorities for next year’s budget.’”

And the timing is right. Feldman said that building permits for 3,800 housing units in the downtown area have been requested and are currently under review.

“People are coming back to the city,” he said. “And these condos and multi-family units will be above [ground floor] retail businesses.”

Some buildings in that mixed development will have retail, with parking above and residential on top of that, he said. Others will have retail, with parking, office space and finally residential on top.

“With increased density, we’re going to see increased retail, mass transit working better and walkability is vital,” Feldman said.

The timing is also strategic because city staff is beginning to think about the 2014 budget. If all goes as Feldman hopes, that new budget could be structured under the Vision Plan.

Ann Henson Feltgen can be reached at ahenson@browardbulldog.org

Bureaucrats’ last minute demand alters Broward trash negotiations and could lead to higher rates

By Buddy Nevins, BrowardBulldog.org

Deputy Broward County Attorney Noel Pfeffer makes a point while Solid Waste Director Elliott Auerhahn listens during negotiations over new waste disposal contract.

The promise of the lowest price for waste disposal could be thwarted by a last-minute demand from top Broward County administrators.

The county was in the throes of negotiating a multi-million dollar waste disposal contract when suddenly the government issued a requirement that any company must provide a list of disposal sites.

“This is a big issue, a very big issue…Cities will have problems that they don’t know where their garbage is going,” Thomas Hutka, Broward’s public works director, explained during contract negotiations this week.

Newcomer Sun/Bergeron immediately complained that the new mandate favored Wheelabrator Technologies, the Waste Management subsidiary which has held a near monopoly on Broward’s waste disposal for over 20 years and already owns a landfill and a pair of waste-to-energy plants here.

“When Wheelabrator won this contract 20 years ago, they didn’t have a disposal site. We are newcomers,” said Aleida “Ali” Waldman, Bergeron’s general counsel.

Sun/Bergeron Vice President Phil Medico contended residents and businesses could get a better deal by disposing of the waste in whatever facility has the best price rather than tie themselves to one site for five years.

Under Sun/Bergeron’s proposal, waste would be sent to various transfer stations around Broward and then sorted through for recyclable material.  Anything that could not be recycled would be trucked to yet-unnamed disposal sites.

Wheelabrator proposes to continue disposing waste in its two company-owned existing sites. The waste is minimally processed for recyclables and is either burned or buried – in a landfill along Florida’s Turnpike in North Broward or in an incinerator just south of Interstate 595 in Davie. The burned trash at both locations is used to generate electricity.

The sites were built in the late-1980s under a contract with Broward County that will expire in 2013. Under its current agreement, Wheelabrator handles the disposal for 26 of Broward’s 31 cities.

Waste removal involves two separate jobs.  A hauler has a franchise with each city to pick up waste at homes and businesses. That waste is then hauled to a disposal site that tacks on a fee. The hauling and disposal fees are generally rolled into one fee paid by residents and business owners.

The current negotiations involve only disposal, but it is a contract worth tens of millions of dollars over five years.  Negotiators are working over details of the contract at this point and no final prices have been set.

DEAL TO MAKE OR BREAK TRASH MONOPOLY

With the end of its contract on the horizon next year, Wheelabrator at first proposed extending its monopoly for 20 years through 2033. Sun/Bergeron saw an opening and launched a lobbyist effort to block the renewal of the contract.

The lobbying worked. Enough cities, and eventually the Broward County Commission, voted to reject renewal with Wheelabrator. They gambled that better rates could be obtained by pitting Wheelabrator against Sun/Bergeron in competitive bids.

Miramar agreed to be the first city to ask for competitive bids from the two disposal companies. Wheelabrator’s bid was $52.50 per ton, compared with Sun/Bergeron’s $43.25 per ton. Sun/Bergeron got the nod, and a deal is being negotiated. The negotiations by the county and other cities is their attempt to fine-tune the Miramar bid to see if an even a better deal can be reached.

Sun/Bergeron is a joint venture, which is headquartered in Davie in an industrial area near I-595.  Sun Recycling, the operating partner, is a subsidiary of the veteran waste company Southern Waste Services of Lantana.  Bergeron Environmental and Recycling is the latest venture of Broward entrepreneur Ron Bergeron, who is already a dominant force in road building, storm recovery, real estate and rock pits.  Medico, a long-time waste industry executive, is the chief negotiator for Sun/Bergeron.

Medico told county negotiators that “supply and demand” would lower the price over the next five years because numerous new waste disposal sites are expected to open in South Florida, and there would be a “surplus of opportunities to dispose of waste.”

There sites in Miami-Dade, Lee and Okeechobee Counties. Palm Beach County is building a waste-to-energy incinerator that is scheduled to go online in 2015. Any site picked by Sun/Bergeron – like all legal disposal sites in Florida – would have gone through a rigorous permitting procedure by the state.

“Any waste will have a final resting place in a legally permitted class one facility,” Medico said.

MISSED OPPORTUNITIES?

Speaking to negotiators this week, Medico warned that Broward should not make the same mistake it did in the 1980s by binding disposal to one company’s sites. The county missed opportunities to lower prices because “you were tied up in a 25-year monopoly.  You didn’t have a choice” about what sites to use, Medico said.

Under the rules of the negotiating sessions, each company gets a day to be grilled and explain its position on why they should be chosen to dispose of Broward’s waste.  The discussion of the sites came on Thursday when county staffers and two city managers – Lee Feldman of Fort Lauderdale and David Rivera of Coconut Creek – were going over Sun/Bergeron’s proposal line-by-line.

Thursday was Sun/Bergeron’s day to be questioned. Wheelabrator’s Vice President of Operations Bill Roberts and Senior Legal Counsel Emily Kahn sat in the audience taking notes.

In an interview earlier with Broward Bulldog at Wheelabrator’s sprawling computerized incinerator plant in Davie, Roberts made his case for his company to continue the contract.

All waste delivered to Wheelabrator’s South Broward plant ends up in this gigantic bin. This is approximately 12 tons of garbage. Photos by: Buddy Nevins.

“We have a proven technology that’s reliable…The infrastructure exists. These facilities are strategically located,” Roberts said.

He added that having the disposal sites in Broward contributed $23 million in wages, goods and services and other indirect spending to the county’s economy.  He said disposing waste locally takes vehicles off the road because it doesn’t have to be transported to another county.

“Our system has worked very well for 20 years,” he said.

The county led negotiations are scheduled to conclude and go to the County Commission for its approval by May 8.  On paper the negotiations only involve the small slice of Broward that is unincorporated, but several cities are expected to piggyback on the agreement, hence the presence of Feldman and Rivera.

Deputy County Attorney Noel Pfeffer, who is leading the negotiations, said the company that is chosen is expected to go out and sell the agreement to the 26 cities now using Wheelabrator.  “There will be some period of time (built into the final contract) for the company to go out and market the agreement,” he said.

COMPETITION AND LOWER RATES

Competition has already driven down the price of disposing of garbage in Broward. More price pressure is likely. For instance, there is an overcapacity at Wheelabrator’s South Broward waste-to-energy plant.

The plant was built to handle 1.5 million tons a year. A few years ago it was processing 1.2 million tons. Today, it’s just 900,000 tons due to the failure to forecast increases in recycling and the struggling economy.

“In the end, they have to have waste to keep that facility going.  If they lose this contract and aren’t getting enough waste, they’ll cut the price and accept waste from other counties,” predicted a waste industry source.

Roberts confirmed that Wheelabrator’s local facilities would have to take waste from other counties if they failed to get enough from Broward.

One company that could conceivably help fill Wheelabrator’s plant is Sun/Bergeron,  if rates drop far enough.  Sun/Bergeron would collect the waste at transfer stations in Davie and elsewhere, then send it to the plant for disposal.

“We have a contract with them for disposal in other places,” Medico said.

 

 

 

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