By William Gjebre, BrowardBulldog.org
A weekly newspaper in Hallandale Beach got a $50,000 city “loan” under terms so favorable that half of it – $25,000 – amounted to a taxpayer giveaway because the city did not require it to be repaid.
The for-profit South Florida Sun Times obtained the loan even though the paper’s two top executives reported incomes averaging more than $200,000 each for two years prior to receiving the city loan in 2009.
The Sun Times also benefited in recent years from an increase in city spending on advertising. The city’s no-bid ad purchases and loan averaged $65,000 annually during the past three years.
Throughout that time, and currently, the weekly Sun Times has featured Hallandale Beach Mayor Joy Cooper as a prominent columnist, with a link to her writings about city issues on the front page of the paper’s web site.
The newspaper, which often writes upbeat stories about advertisers, circulates in Dania Beach, Hollywood and Pembroke Pines south to North Miami and Surfside. Cooper, who is not paid, is the only elected official listed on the paper’s site as having a regular column.
The paper’s arrangement with Mayor Cooper is under fire.
“How can you be independent if you are dependent on the city?” said community activist Csaba Kulin. He criticized the Sun Times for neglecting to print comments from readers in response to stories.
“It’s propaganda for the mayor,” complained City Commissioner Keith London, a rival of the mayor who has sought unsuccessfully to halt city spending for ads in the Sun Times. “There’s no fact checking and no rebuttal; the city pays a lot of money for a bully pulpit for the mayor.”
Mayor Cooper said she was invited to write for the paper about five years ago. She sees “no conflict” in her writing a regular column and the city’s advertising and loan to the paper. She said she had nothing to do with those deals, adding that they were recommendations of former City Manager Mike Good.
Cooper said, too, that she has not used her column to gain any political advantage.
“I’ve written to inform residents what’s going on,” Cooper said. “I try to make it informative. It’s not always about city business. It’s also been about individuals, about the environment, about veterans. I’m like a reporter. I don’t get paid.”
Cooper also said her columns were not part of the city’s expenditures for advertisements in the newspaper.
The mayor generally writes about community activities, city government operations, and city commission actions from her perspective. There is no mention of oppositional or different viewpoints – if they exist.
In April 2009, the Sun Times became the first city business to receive a loan under a new program, funded through the Community Redevelopment Agency (CRA), to retain and to assist firms having financial difficulties. The CRA, a special taxing district that covers most of the city, is controlled by city commissioners and the mayor.
The city’s Business Retention and Expansion Program provided for 50% to 80% forgiveness on loans up to $50,000, with the balance to be repaid at two percent interest over 10 years.
The Sun Times received the maximum loan amount, $50,000, with half of that amount “forgiven” under the program in its loan agreement with the city.
Richard Cannone, who oversaw the CRA as the city’s director of development services, wrote a memo in December 2008 that then city manager Good had approved the $50,000 CRA loan to the Sun Times. In another memo, Cannone stated the funds were “loaned to rescue the newspaper from financial hardship that had befallen their company over the past few years.”
No other CRA loan program has the forgiveness percentage that the Sun Times received under the new program. CRA code compliance loans, allocating up to $100,000, and CRA Business Incentive and Enticement loans, allocating up to $200,000, provide for forgiveness of 15% of loans, with balances to be repaid at four percent interest over 10 years.
Craig Farquhar, president of the South Florida Digest, which publishes the Sun Times, declined to discuss the newspaper’s financial dealings with the city, its editorial policies, or its relationship with the mayor.
“This is old news,” he said. “I have nothing else to say.”
Hallandale Beach took other action beneficial to the Sun Times’ owner.
In 2010, according to CRA records, the city agreed to subordinate its position on the loan balance so the newspaper could refinance a mortgage loan. That meant the city gave up its claim as first in line for repayment in case of a default — putting taxpayer funds at increased risk.
BIG SALARIES AND CITY MONEY
City documents also show that before the loan “rescue the newspaper” was made, its two top executives drew six figure salaries.
Farquhar likewise declined to address the newspaper’s need for the city loan in view of the hefty incomes of he and South Florida Digest Vice President Cecile Hiles.
CRA files contain federal income tax returns showing that South Florida Digest paid salary and wages to Farquhar totaling $259,193 in 2007 and $239,054 in 2008, as well as an additional $41,239 in pension and annuity payouts. Hiles received $192,052 in 2007 and $229,010 in 2008.
Current CRA Director Alvin Jackson said the wages Farquhar and Hiles were paid would not have disqualified the Sun Times from receiving the $50,000 loan. The information about their incomes was required by the city to determine the newspaper’s ability to pay back the loan, he added.
Jackson said the paper asked for the loan to survive a downturn in the economy. The paper had lost advertising and had cut jobs and reduced benefits, he said.
Hallandale Beach has also come to the rescue of the Sun Times with increased advertising purchases made without competition.
City records show that for the five-year period between 2003 and 2008, the city paid the Sun Times about $32,000 for advertising.
Those numbers jumped the next year, when the city bought about $42,000 in advertising and issued the $50,000 loan . The city bought $52,000 in advertising in 2009-2010, and $53,000 in 2010-201. It has agreed to buy $50,000 in advertising this fiscal year.
The most recent advertising buy was included in the current budget approved by the city commission on Sept. 26, 2011 in a 4-1 vote. Cooper voted yes; London was the lone dissenter.
PURCHASES WITHOUT BIDS
The city advertised in the Sun Times without seeking bids. The mayor said that’s because it was the only local newspaper in the city. City code, she said, provides for giving preference to local businesses and those which are one of a kind. “There is no other provider,” Cooper added.
Because the Sun Times is not a newspaper of general circulation in the county, like the Sun-Sentinel or The Miami Herald, the city has to place its legal notices in other area newspapers.
Cooper has been a strong advocate in the community for the Sun Times. She urged local businesses to advertise in the newspaper in a 2008 letter on city stationery, co-signed by then city manager Good. Today, she says she favors future city support for the only city-based newspaper.
“To the naysayers, it’s not about” the column being used as a political platform, said Cooper. “It’s a service to the community to inform.”
Not everyone sees Cooper’s writing as useful.
“The mayor’s column: I used to read it,” Kulin said. “But it’s one-sided. It’s feel good stories about herself and the city.”
William Gjebre can be reached at [email protected]