HomeMy WebLinkAboutCC 2000-07-11 MinutesCITY OF MIAMI
SPECIAL
BUDGET
MEETING
MINUTES
OF MEETING HELD ON JULY 11, 2000
PREPARED BY THE OFFICE OF THE CITY CLERK/CITY HALL
Walter J. Foeman/City Clerk
ITEM NO.
•
INDEX
MINUTES OF SPECIAL MEETING (BUDGET)
JULY 11, 2000
SUBJECT
LEGISLATION
1. B-1 (A) AUTHORIZE ACCEPTANCE OF 7/11/00
PROPOSED BUDGET FOR CITY FOR FISCAL M-00-588
YEAR BEGINNING OCTOBER 1, 2000 AND R-00-589
ENDING SEPTEMBER 30, 2001; MANAGER TO 1-32
SUBMIT SAID PROPOSED BUDGET TO THE
FINANCIAL EMERGENCY OVERSIGHT BOARD.
(B) MANAGER TO SEND LETTER TO
RESIDENTS OF MIAMI EXPLAINING LOWEST
MILLAGE RATE (8.995) CITY HAS HAD IN
APPROXIMATELY 30 YEARS, CITY'S SOUND
FINANCIAL HEALTH AND COMPARISON WITH
RATES OF OTHER MUNICIPALITIES.
(C) PRESENTATION BY BERTHA HENRY ON
ROLL BACK RATES.
(D) COMMISSION -DISCUSSION ON
BUDGET.
(E) MAYOR CAROLLO - DISCUSSION ON
BUDGET.
(F) ACCEPT STAFF'S RECOMMENDATION OF
OPTION NO. 3 FOR PROPOSED BUDGET FOR CITY
FOR FISCAL YEAR 2000-2001.
MINUTES OF SPECIAL MEETING (BUDGET) OF THE
CITY COMMISSION OF MIAMI, FLORIDA
On the 11th day of July 2000, the City Commission of Miami, Florida, met at its regular meeting
place in the City Hall, 3500 Pan American Drive, Miami, Florida, in special session.
The meeting was called to order at 7:23 p.m. by Mayor Joe Carollo, with the following members
of the Commission found to be present:
Commissioner Wifredo Gort (District 1)
Commissioner Johnny L. Winton (District 2)
Commissioner Joe Sanchez (District 3)
Commissioner Tomas Regalado (District 4)
Commissioner Arthur E. Teele, Jr. (District 5)
B-1. (A) AUTHORIZE ACCEPTANCE OF PROPOSED BUDGET FOR CITY FOR FISCAL
YEAR BEGINNING OCTOBER 1,, 2000 AND ENDING SEPTEMBER 30 2001; MANAGER TO
SUBMIT SAID PROPOSED BUDGET TO THE FINANCIAL EMERGENCY OVERSIGHT BOARD.
(B) MANAGER TO SEND LETTER TO RESIDENTS OF MIAMI EXPLAINING LOWEST
MILLAGE RATE (8.995) CITY HAS HAD IN APPROXIMATELY 30 YEARS; CITY'S SOUND
FINANCIAL HEALTH AND COMPARISON WITH RATES OF OTHER MUNICIPALITIES.
(C) PRESENTATION BY BERTHA HENRY ON ROLLBACK RATES.
(D) COMMISSION — DIS'CUSSION ON BUDGET.
(E) MAYOR CAROLLO — DISCUSSION ON BUDGET
(F) ACCEPT STAFF'S RECOMMENDATION OF OPTION NO. 3 FOR PROPOSED
BUDGET FOR CITY FOREISCAL YEAR 2000-2001.
Mayor Carollo: The special Commission meeting on the fiscal year 2001 proposed budget will now come
to order. Mr. Manager, can you begin by presenting to the Commission the different options that you have
gone over with me, and also, individually, I believe, with all if not most members of the Commission?
Carlos Gimenez (City Manager): Yes, sir. I have a prepared text that I'd like to read, and then I will
move on to the presentation. Mr. Mayor and Members of the Commission, on June 81h, the administration
presented the Commission with its proposals for the fiscal year 2001 budget. These proposals included
service enhancements and operating efficiencies that were reprogrammed to meet Commission and
community priorities. These included expanded park services and a myriad of enhancements such as code
enforcement, and neighborhood cleanups that specifically enhance the neighborhoods. To support the
tremendous increase in building activity, increased staff support was provided in the Planning and
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Building Departments to expedite building and plans review. Finally, the City moved forward with the
creation of an infrastructure maintenance fund, support for the auditor general and neighborhood festivals.
To support the enhancements outlined above, the administration proposed tax rates and fee levels that
conformed to those provided in the five-year plan. These included a millage rate for operating purposes of
nine point five mills, debt service millage of one point two eight, which is slightly below the rollback rate,
and the planned increases in fire and solid waste fees at nine dollars ($9) and twenty dollars ($20),
respectively. In my closing statement, I committed to meeting with each of you to review the budget in
detail, and I have done so. From those discussions and through further deliberations with staff, we are
proposing some adjustments that were presented in your June 22nd packet. These include the support for
the Community Relations Board and the Intergovernmental Liaison. Additionally, there are a couple of
scrivener's errors, corrections that we'd like to make on the floor, which will follow after Ms. Henry's
presentation. This evening, the focus will be on tax and fee structure needed to support the budget in the
five-year plan. As you recall, the budget discussion was deferred from the June 22, 2000 meeting as a
result of a ruling by the Fourth District Court of Appeal, which affects the fire assessment. In a nutshell,
the ruling opines that emergency medical services is not a specific benefit to property, thus should not be
used as a component of the assessment. Though he does not specifically agree with this ruling, the City
Attorney has opined that the safest course of action for the City is to exclude EMS (Emergency
Management Services) calls from the allocation methodology. Essentially, call data, which is a method by
which rates are established by category, will only include fire calls. This change generates a shift in the
rate structure between residential and commercial properties. This, too, will be explained in greater detail
as Ms. Henry goes through her presentation. Finally, based on feedback from our individual briefings, we
have taken the opportunity to offer additional revenue scenarios that offer different philosophical
approaches to reaching the revenue goals required for the budget, as the City looks forward to the future
for lower taxes, fair and equitable fees, and effective and responsive government. And with that, Assistant
City Manager, Bertha Henry will start the presentation.
Bertha Henry (Assistant City Manager, Finance and Administration): Thank you. Very briefly, I'd like to
focus on two issues. We have talked quite a bit about — excuse me — the rollback rate and the County's —
the State's calculation of that rollback rate, the City's calculation of the rollback rate, what we would
propose as a millage rate for the FY 2000 budget. From that, we've had individual briefings. We've
come up with some scenarios that we want to discuss further. But just to quickly run through the
presentation. On slide 2, we start — I thought we'd start out with the amendments, which are basically the
— some of them are scrivener in nature, beginning with the City Commission. And you may not want to
make this change. Basically, what has transpired here is that the details that were given to you are sixteen
point eight million dollars ($16,800,000) less than what the appropriations summary provided for -- I'm
sorry -- sixteen thousand, eight hundred and nine. As we have indicated, as part of our individual
briefings, some of you have met specifically with the analyst that works with the City Commission. We
really do feel that overall; your budget is very small. It gives you very little flexibility. And I know in the
past, we've attempted to move that forward with some discomfort at the Commission level. But at this
point, if we are to be consistent with what was presented to you earlier, the appropriation would match
those summary sheets, which would be sixteen thousand, eight -o -nine less. Or we can leave it and
reallocate this within your budget to help with some of the expenditure pressures that you have. Second,
we have — During our initial presentation on June 81", we indicated that most of what we presented to you
with respect to property taxes was our estimate, because we didn't have the DR -422. And we indicated
that once we received that document from the County, which gives us the specifics on our property taxes,
versus us trying to estimate what that would be, it would result in some changes. And we have prepared a
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revised forecast. And that, those revisions have been discussed with the Estimating Conference, primarily
just as I indicated, in property taxes. And for FY 2001, there is about a ninety-one thousand dollar
($91,000) reduction in property taxes. It gets better in the out years. I mean it improves, but in this year,
it's ninety-one thousand less. And so we're having to reduce our operating surplus by that amount. Police
services. We — the Police Department had some carryover funds, and they'd like to take advantage of
those funds into the year 2000 — 2001. We made from the last amendment that we presented to you some
slight changes on the position authorizations. Fire Department in its general fund went down a half a
sworn position, went up a half a sworn position in the Disaster Recovery, the FEMA (Federal Emergency
Management Agency) program. So it's technically a wash. And under the Special Revenue Fund for the
— both of these affect the Police Department. We showed the 18 additional positions in the Police
Department budget for the Police Athletic League. They technically will contract with that entity, which
is a 501(3)(c), I believe. And therefore, it wouldn't technically be on their payroll. They'll provide the
funding support, but the positions will be with that entity. And those were the — those were the changes.
With that, we are presenting you with an overall fund summary that takes the 2001 budget for all funds to
five eleven point seventeen. And that's overall about a point four-four percent increase. We are required
a five-year plan, and we've done that, and we'll talk a little bit about that shortly. But it contains several
increases, and I need to differentiate between what you see now and what you will see in a few minutes.
What you have in front of you is in the initial plan we have — the plan calls for the following increases: In
2001, a nine dollar ($9) increase in the fire fee, a four dollar ($4) increase in 2002. For solid waste, it
basically carries a twenty -dollar ($20) per year increase throughout the plan. And the plan also has an
increase in business licenses of five percent every other year beginning 2002. That's consistent with state
law and what you can increase by. Very quickly, and I won't spend much time on this. For 2000, our
combined millage is ten point nine mills. That's nine and a half for operating, one point four for debt
service. When you use the state calculated rollback rate, combined, it goes to ten point three two five.
The effective rollback rate is ten point five two five. And by that, the City — and this affects — I mean, we
talked about this. This affects all cities. But just basically, the state makes certain assumptions about the
technical way that the rollback rate is collected. And basically, it gives you the preliminary assessment
without regard to adjustments by the Value Adjustment Board. So what technically happens is the
preliminary assessment goes out. The property owners will apply to the Value Adjustment Board. The
values go down. So the revenue, the millage applied to the assessed value ultimately is lower than what is
given in the preliminary. So this not only affects Miami, but it affects other cities. But it affects us quite a
bit, because that's a — for us, it's a significant amount of valuation that we lose each year. In addition to
that, there is a collection rate issue that's not specifically addressed in the rollback rate. Most
communities do not collect 100 percent of what is assessed. So when you combine those two — and we
have worked with the Oversight Board and the Estimating Conference on this issue for several years. And
basically, we've come up with a process by which we do an average three-year average of what our
collection rate is, and apply that in the prospective year. We do a three-year average of what we expect
our valuations to drop, based on history. And so with that, that's what we would refer to as our effective
rollback rate. So if you take what we consider our effective rollback rate and the proposed millage rates,
and these are the millage rates that were presented to you at the — on June 81h, the growth in the millage
rate is about point two five five. And obviously, when we — if this is the scenario that's approved, which
we will come back to you on July 27th, where you would have to establish rates, the rates for the City of
Miami would be at ten point seven eight from the ten point nine, which we have right now, which is a
reduction of point one two. When it's all said and done, we expect to generate a hundred and forty million
dollars ($140,000,000) from those millage rates, which is an increase, about, of three point seven, three
point seven million. But we would like to once again bring to your attention that we are proposing that the
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— in this scenario that the debt service millage rate is reduced from below the rollback rate and below our
effective rollback rate. And that's because we have — we have accumulated some funds in the Debt
Service Fund, which we have to use for that purpose. And these are interest that has accrued, not in the
capital project itself, just in the Debt Service Fund, because of the way property taxes are collected early
and so forth. During our reconciliation, we noticed that that had accumulated. So we're on a spin -down
from that, and that allows us to do that. This is where we start to get — On slide 10, this is where we start
to get into the real meat of what we need from you today or tonight. As the Manager indicated, when the
fire fee — when the Fourth District Court of Appeals came down with its ruling, it basically changed the
way that we would have to determine what our rates are. So we've sort of walked you through a couple of
scenarios, and I'm going to jump back and forth, in between these slides a second, because there's certain
things that's important to point out. In our original budget scenario, we were going to go with a nine -
dollar ($9) increase from sixty-one dollars ($61) to seventy dollars ($70), where we would have our
twenty -dollar ($20) increase in the solid waste fee, and we'd have our millage at nine point five in the one
point two eight or ten point seven eight. That is an increase from this year, when you do a rollback. What
we did, so that we have a fair comparison, for property taxes, we assume that the value of a hundred
thousand dollar ($100,000) home is about two point seven percent less than it is now. If you — in the
paper, on Sunday, the Property Appraiser indicated that the three percent cap wasn't used, that he used
two point seven, which was the inflation rate. The next scenario, basically, if you — when we recalculate
the distribution, the fire fee distribution, based on fire calls, what it does is it shifts some of the burden
from residential to commercial. And what that does is if we remained at sixty-one dollars ($61), it gives
us a windfall of about a million four. And what is — what we did, just as a scenario, based on some of the
discussions that we heard from you, we dropped that nine point five by one tenth of a mil to nine point
four. But it's important that, if you look at slide number 11, that we give you some idea of what happens
with that. And basically, what this shows is if you have — for the fire fee, if you have square footage that's
below 2,000 square feet, you can see what happens to the rate under this new calculation methodology.
You would go from fifty-eight, from fifty-eight dollars ($58) to a hundred and twenty-four ($124) or an
increase of sixty-six dollars ($66), all the way, if you go to the very end, because we're capped at 200,000
square feet, the rate stays the same, you'd go from eleven thousand, six hundred dollars ($11,600) to
twenty-four thousand, eight hundred and thirty-two dollars ($24,832), which is an increase of thirteen two
thirty-two. So we wanted to make sure that you understand that though we could keep that residential rate
at sixty-one dollars ($61), where there's no increase — and one of the reasons we talked about that was if
for some reason, we decide after the — if the Fourth DCA's (District Court of Appeal) ruling is overturned
by the State Supreme Court and we were to go back, we could have these — we could have these fire rates
jumping up and down. So we presented that as an alternative, so that you can see what the impact is. But
that carries through, once again, to about a thirty-two dollar ($32) increase overall, when you add .up all of
our fees. The second scenario is the scenario that says if you want to generate what you were going to
generate in the beginning, the residential rate would drop to fifty-five dollars and eight cents ($55.08).
And for — with other fees remaining the same, which would be about a thirty-three dollars and seventy-
four cents ($33.74) increase. The last scenario is a scenario that — well, we've had a lot of discussion
about the City's ability to go back to the rollback rate. As 1 indicated earlier, the state's technical rollback
rate is about eight point nine nine three. We gave a scenario that does two things. It takes us just slightly
below or pretty much at or slightly below the rollback rate. But it also generates or it increases the solid
waste fee such that it starts to be somewhat competitive with some of the other systems in the area. So if
you look at slide 12 — and unfortunately, none of the other cities have current numbers for us. So at this
point, we're using the rates that were available for FY 2000, except for the City, when you see where
technically the City would fall. So three hundred and twenty-five dollars ($325) is still a relatively low
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rate as you compare to some of our other major communities, like Coral Gables, Miami Springs,
Homestead, the County, Aventura, et cetera.
Mayor Carollo: Excuse me, Bertha.
Ms. Henry: Yes.
Mayor Carollo: What you meant to say was that these rates are their actual rates. What you don't know is
if they are increasing their rates for this coming fiscal year.
Ms. Henry: Absolutely. And we would suspect that there would be some increases in some of the rates.
But because that information isn't available now, we were not able to generate that. But it basically shows
you where you would fall without any increases in the other communities if the City were to go to that
level.
Commissioner Regalado: Bertha, one question. How many municipalities do have fire fee?
Ms. Henry: I'm sorry?
Commissioner Regalado: How many municipalities have fire fee?
Ms. Henry: The City of Miami is the only municipality within Miami -Dade County that I'm aware of
with a fire fee.
Commissioner Regalado: So the City of Miami is the only one. If we were to compare other
municipalities to the City of Miami, on what column do you think that we can place the fire fee — garbage?
Tax? -- If we were to compare what people have to pay.
Ms. Henry: OK. We will — Marcelo if you can — that sheet that we had before. Once again, the issue
with that is we don't have the comparable data for the other communities, because they have not published
their rates. They have not - for either the fire fee or the solid waste fee. But if you recall, in a previous
slide — and he will get that for you in a few minutes — we were, for our major competitors, we were not
that far off.
Commissioner Regalado: Right. But if I were to say, OK, we add the fire fee, because it's a service to the
increase that you propose, three hundred and twenty-five plus sixty-one, that would be four hundred
dollars ($400) of garbage yearly, right?
Ms. Henry: For the =
Commissioner Regalado: That would place the City of Miami on the top of the County with the -- What
I'm saying is that since no other city has fire fee, where — it's sixty-one dollars ($61) on a residential that
we have to pay. It's the same money, you know, has to come out from the same checkbook. So sixty-one
dollars ($61), we add that either to the tax or to the garbage, if we were to compare the City of Miami to
other municipalities.
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Ms. Henry: Yes.
Commissioner Regalado: That's what I'm saying.
Ms. Henry: Yes. And in the past, basically, what we've said was even when you do that, it doesn't put —
it doesn't make the City the highest, you know, in overall rates, because you have some communities, like
Miami Shores, for example. Miami Shores' millage rate, as I recall, was higher than the City's millage
rate, and their garbage fee is four hundred and twenty dollars ($420), compared to our current two thirty-
four. So if you add that difference with their millage on the same value of a home, ultimately, they would
still pay more than a resident for the same value of a home in the City of Miami. But obviously, there are
other areas where it would be lower. For example, in the UMSA (Unincorporated Municipal Service
Area) area, which is the unincorporated area for the County, which has a very low millage. And so it just
depends on where you are. And we also specifically talked about the difference in the level of service that
each of the communities provide.
Mayor Carollo: Bertha let me point something out.
Ms. Henry: Yes.
Mayor Carollo: Because if we're going to lump a fire fee and garbage fee together to do that kind of
comparison, then what we need to also point out, if that's the kind of comparison that's going to be done,
that there is no other governmental body in this County that provides the kinds of services that the City of
Miami does for the garbage —
Commissioner Sanchez: Solid waste.
Mayor Carollo: Yeah. And trash, for that matter, combined. Nobody provides as much service on a
weekly basis as the City of Miami. So if anything that would have to be discussed is sometime in the
future -- because it's not going to happen now. I mean, you can't do it overnight — do we want to, do the
residents of Miami want to and need to have such a high quality of service? Do they want a Mercedes-
Benz type of garbage/solid waste service, or will they be satisfied with a Cadillac, you know, an
Oldsmobile? And this is what we have to look into the future, including revisiting the issue if
privatization is really going to save us a sufficient ampunt that we might want to consider it. I don't know
if it would or not. It might. But these are issues that have to be discussed in the future by the City. But
we're not going to be able to accomplish that in time for this present budget that we're dealing with.
Vice Chairman Gort: Mr. Mayor.
Mayor Carollo: Yes.
Vice Chairman Gort: I'd like to bring up for the last three years, I've been requesting the department to
look at that, and try to do a survey, and see if we could cut some of the services that we're — I mean, we
provide four pickups a week, plus some additional services. I think we need to look in that.
Ms. Henry: Commissioners, on slide 13, we're just basically giving you an opportunity to see how the
City's millage has moved somewhat up and down, but over the latter `80s and down now into 2000, you
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can see that the City is beginning to show some movement in its millage. That last bar that you see there
is the extreme bar. It shows the eight point nine nine if you start — and the debt service millage, if you
start to go to rollback and the like. But it gives you an idea of where the City has been and where it's
attempting to go with respect to its millage. Now, some of those, as you know, if you see where they are
above the ten mil, you have the ability to have voted millage. And I'm not sure exactly when the State put
in that ten mil cap. OK. So a lot of — we had a lot of —
Commissioner Winton: How did we get so far above it in the 1970's?
Ms. Henry: Voted millage.
Alejandro Vilarello (City Attorney): Well, I think that for comparison purposes, they're putting the debt
service on top of that. That debt service is not included within the ten -mil cap for the purposes of the
Constitution.
Commissioner Teele: But debt service is approved by the voters.
Commissioner Winton: Yeah, but it shows the debt service is on top of 14.
Ms. Henry: But if — you can have additional millage if it's approved by the voters.
Vice Chairman Gort: General obligation bonds. You have to take it to the voters.
Mayor Carollo: Well, the bottom line is that what you need to count is total millage, because that's in
essence what you pay.
Ms. Henry: Just to sort of move through the rest of this. On Slide 14, when we were here for June 8th, this
was the scenario. We had an operating surplus of seven hundred and eighty-seven thousand forecasted for
this budget for 2001, and it takes you out to 2005, where we were at about a ten million dollar
($10,000,000) deficit. Now, that deficit, as I recall — and I want to make sure that I again put this on the
record. The property tax estimates are very conservative, or we feel, the administration feels that the
property tax numbers are conservative. We have made no major assumptions about the City's properties
and ultimate development of those properties, and the impact that they will have on our finances. And we
really felt that things were — we were — we had the ability to make much of that up. Now that we have the
final numbers from the County, we have updated the forecast. And if you go to slide 15, this sort of walks
you down what basically is happening. So right now, where we are with an operating surplus of eight
sixty-four. We've made some changes there. And you can see that the — for year 2005 that deficit has
declined, largely because of property taxes. And the way this works — and this is what we have agreed to
with the Estimating Conference of the Oversight Board is we use a three-year average of what our
assessed value growth is going to be. We take that information and we extrapolate that out in the future
with a decline. So the premise is that we are not going to stay at six percent growth, that we will have
some decline. And what you see here is the growth in our assessed valuation from FY 2000 to 2001 in
terms of what we'll put in our budget had a greater growth rate. Now, the dollars have been somewhat — I
mean, it's somewhat of a decline, because of, as you know, we did address the Save Our Seniors. But
once that's in the base, it still allowed us to have that extra growth. And the percent on our assessed
valuation can really cause major swings in these numbers. So we do see an improvement there. And what
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you — as you go through these scenarios, we just wanted to show you what happens to the bottom line
from 2001 to 2005 for each of those scenarios that we discussed a couple of pages earlier. So I want to
stop for a second and start to answer any questions on where we are so far.
Mayor Carollo: Any questions from any member of the Commission?
Commissioner Regalado: Question. Are you including here the twenty-five thousand dollars ($25,000)
added homestead exemption?
Ms. Henry: That's taken into consideration, yes.
Commissioner Regalado: And that's about 10,000 residents — I mean 10,000 property owners in the City,
more or less. Right?
Commissioner Sanchez: Two hundred and thirty-seven dollars and fifty cents ($237.50) per each.
Ms. Henry: Yes.
Commissioner Regalado: No. I mean 10,000 property owners.
Ms. Henry: Properties that took advantage of it. We're waiting on the detail on that. But in our
discussions with the Property Appraiser — excuse me — he indicated that that value is about one point two
million, the value of that twenty-five thousand dollar ($25,000) reduction. So, I mean, I guess we could
extrapolate from there how many residents took advantage of it.
Commissioner Regalado: Yeah, but at the same time, the same office just raised the numbers in all the
assessed properties. So, you know, the value is more. So people will be paying a little more than they.
would because the property value went up throughout the City and throughout the County.
Ms. Henry: Yeah, assuming the millage rate doesn't change.
Commissioner Sanchez: Bertha, I have some questions on this. One is, does this budget document
comply with the principles in the five-year plan, all the recommendations made here?
Ms. Henry: Well, you have -- the initial presentation that was made to you conforms. And it still does at
this point. But we, as you recall, we were asked to provide some scenarios that would basically look at
going back to rollback rate, and looking at maybe some redistribution of — you know, getting to the
bottom line in terms of revenue. But how we get there changes somewhat.
Commissioner Sanchez: Now, the three scenarios that are in front of me here today, you have Scenario
Number 1 -- which we'll call Scenario Numbers 1 through 3. The millage would stay at nine point five.
So in other words, no millage rate increase expected for that scenario. Then we go to the fire fee at the
current residents rate, which is fifty-five.
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Ms. Henry: The current rate is sixty-one. Because of the redistribution of the call data to generate the
same amount of money, and because the commercial sector has more fire calls than residential, right, it
changes the numbers.
Commissioner Sanchez: But it changes to fifty-five.
Ms. Henry: Right.
Commissioner Sanchez: It stays at fifty-five. And then the solid waste fee at the projected rate of two
hundred and fifty-four dollars ($254), and from there on, from year 2001 to 2005, as approved by this
Commission, the increase goes forth.
Ms. Henry: It's in the plan, yes.
Commissioner Sanchez: Now, what would be, if I were to compare -- In Plan Number 3, although I
somewhat understand it, it's sort of like, compared to 1, it's pay me now or — which, you know, we'll
spend the money now and it'll come back to benefit us later, because, one, we'll be able to lower the
millage to the lowest point, which we anticipate on being eight point nine, the lowest, and probably the
lowest in a lot of years for the City. Now, the question that I have — well, it is. Isn't it, compared to the
chart? Do you have your 1972? The lowest. Now, what I want to compare is I'm looking at Scenario 1
and comparing Scenario 3, where the millage rate at a reduced rate of eight point nine, and the millage rate
— no millage rate increase expected. Fire fee at a current resident rate of sixty-one dollars ($61) projected
for the five years in the budget, and goes all the way to FY 2005. Then we go to the solid waste, which
pops up to three twenty-five, compared to the chart that you displayed, which clearly shows all the solid
waste fees by municipalities and cities. We have the City, which falls just about in the average of three
twenty-five, the lowest being West Miami, which pays a hundred and fifty dollars ($150), compared to
Coral Gables, which pays four hundred and ninety-eight dollars ($498).
Ms. Henry: Yes.
Commissioner Sanchez: OK. Now, what I would like, you know, through you is to compare Scenario 1
and Scenario 3, and find out what would be the difference. How much savings would the taxpayer, the
average taxpayer have comparing a millage of eight point nine to a nine point five? Being that the average
property is — what? A hundred thousand?
Ms. Henry: Thirty-eight dollars ($38).
Commissioner Sanchez: Thirty-eight on Number 1, right?
Ms. Henry: I'm sorry. I'm trying to make sure I understand what your question is. For the eight point
nine nine three?
Commissioner Sanchez: OK. What would be the difference between 1 and 3 when you add everything
together?
Ms. Henry: For property taxes?
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Commissioner Sanchez: For property taxes.
Ms. Henry: OK.
Mayor Carollo: But in your question, Commissioner, you got to take — and she's right in that. You got to
take consideration to two different scenarios. One, in each of these three scenarios, you're looking at
doing something that is going to come back and haunt us real quick, and that is we're going to be raising
the fire fee for all the commercial properties by 110 percent.
Commissioner Sanchez: No, I understand that. And it's not good, because it'll come back, and of course,
when the lease is done, they'll leave.
Mayor Carollo: Yeah. And I'm only saying that because, you know, they didn't include this in the
information right here that the three scenarios are. It's included in other parts, but, you know, what she
read out for the public, that was not included there, and I think we have to put this on the record, that all of
these three scenarios include raising the fire fee for commercial properties by 110 percent, which is a huge
amount, and especially after we've been throwing so much of the weight on commercial property.
Commissioner Sanchez: Including the parking surcharge.
Mayor Carollo: True. Secondly, we were going to have in the five-year plan the fire fee at sixty-one
dollars ($61) anyway. That was part of the five-year plan. So you really need to look at that, looking at it
not as the fifty-five, but really the sixty-one that was approved before.
Mr. Gimenez: Mr. Mayor, the original on that, she had us increasing it to seventy.
Mayor Carollo: Well, yeah, to seventy. Right now, it's sixty-one. It was bringing it to seventy. And you
are correct, Mr. Manager. I thank you for bringing that out because —
Commissioner Teele: This year.
Mayor Carollo: Yeah, that's really what needs to be looked at.
Commissioner Sanchez: And the reason —
Mayor Carollo: It was from sixty-one to seventy.
Commissioner Sanchez: And the reason why I wanted to make the comparison of Scenario Number 1 and
Number 3 is just if you look at Number 3, with the eight point five — and I think the Mayor has made a
good analysis on what you could do with an eight point five with Moody. We're able to refinance and
later on, when the — you know, we bring in the — we could lower the taxes for years to come. And, of
course, for the next following years, it stays as it is. So that's just comparing. I'm comparing 1 and 3. 1
haven't even looked at 2.
Ms. Henry: It's about thirty-eight dollars ($38).
10 7/11/00
Commissioner Sanchez: Thirty-eight dollars ($38)?
Ms. Henry: Yes, approximately thirty-eight.
Vice Chairman Gort: Let me ask you. My understanding is the difference between 1 and 3 and the other
one is in 1, the increase will be twenty-nine dollars ($29).
Mayor Carollo: Twenty-four.
Vice Chairman Gort: No, no. I'm talking about the increase of the garbage, the increase to twenty dollars
($20) on the garbage, and the nine dollars ($9) on the fire fee from sixty-one to seventy. My
understanding —
Mr. Gimenez: There's additional because there's — you haven't calculated the two point(inaudible).
Vice Chairman Gort: Addition, OK. But when it comes down to the third, my understanding is the total
addition is twenty-four dollars ($24). So you still have a saving of five dollars ($5)?
Mr. Gimenez: It's twenty-four dollars ($24) when you compare it to the original calculations.
Vice Chairman Gort: Right.
Mr. Gimenez: It was a forty-eight dollar ($48) increase, and then the final was seventy-two.
Vice Chairman Gort: OK.
Mayor Carollo: We're looking at twenty-four dollars ($24) beyond what had been approved last year for
this year in the five-year plan that we had.
Commissioner Winton: Per year.
Mayor Carollo: The difference is also that on this plan, that's it. We're not raising fire fees from here on.
We're not raising garbage fee, you know.
Commissioner Sanchez: Is that 3 or is that 1?
Mayor Carollo: We're talking about —
Vice Chairman Gort: Three.
Commissioner Sanchez: The lowest millage.
Mayor Carollo: -- three.
Commissioner Sanchez: Three.
11 7/11/00
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Mayor Carollo: On 3.
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Ms. Henry: No. We have in the last one, the last scenario, we do have — we do continue to have
increases. If you look — did I have — I put that chart in here.
Vice Chairman Gort: Which one?
Mayor Carollo: On the fire, for future years..
Commissioner Sanchez: No. Solid waste, there's a twenty.
Mayor Carollo: Excuse me, for solid waste. Correct. I'm looking at it.
Commissioner Regalado: So, Bertha, you're saying that in the third scenario, the millage rate of eight
point nine would mean thirty dollars ($30)?
Ms. Henry: Just from the nine — from the first scenario, where you have a nine point five mil, which
generates about eight -o -eight, and the seven seventy at the eight point nine nine five. It's about thirty
bucks, thirty-eight bucks.
Commissioner Regalado: Thirty. So thirty-eight dollars ($38) in tax reduction.
Ms. Henry: Yes.
Commissioner Regalado: And the proposed rate of the garbage will be an increase of a hundred and some
dollars?
Ms. Henry: Well, we would be — yes. It would be just shy of that, about ninety-one bucks.
Commissioner Regalado: So then all the residential property owners will pay around seventy to eighty
dollars ($80) more in the third scenario. That's the bottom line.
Mr. Gimenez: Seventy-two dollars ($72).
Commissioner Regalado: Seventy-two dollars ($72) more.
Ms. Henry: Right, net.
Commissioner Regalado: Compared to twenty-four now.
Mayor Carollo: Forty-eight.
Ms. Henry: Forty-eight.
12 7/11/00
Mr. Gimenez: Compared to the original scenario of forty-eight. The original scenario had the average
homeowner paying forty-eight dollars ($48) more this year, because of the programmed increases in the
fire assessment, the solid waste fee, and also the fact that the property values would rise.
Commissioner Regalado: Well, but the property values, the City cannot do anything about that. It's the
County's doing. They can —
Mr. Gimenez: That's correct. But you're going to have to compare all the apples to apples. Because of
the forty-eight dollars ($48) that was programmed in, and now, the difference on the Scenario 2 would be
seventy-two. So it's actually an increase of twenty-four.
Commissioner Regalado: No, no, excuse me. The property, the property value is something that we
cannot legislate here; is that correct? The property assessment value.
Mr. Gimenez: That's correct.
Commissioner Regalado: OK. So what we legislate is if we leave it as the first scenario, it will be
twenty-four? Forty? How much? Twenty-four dollars ($24)? Twenty garbage, six fire fee?
Mr. Gimenez: Nine, the fire fee.
Commissioner Regalado: Nine. OK. So it would be twenty-nine dollars ($29) in the first scenario. The
third scenario for the residential will be close to eighty dollars ($80); is that correct? An increase of eighty
dollars ($80). Almost a hundred dollars ($100) increase in garbage, in solid waste.
Mr. Gimenez: You have a reduction in the property taxes, because you reduced it by point five mills.
Commissioner Regalado: And she said thirty dollars ($30). So we're talking a reduction in property
taxes, thirty dollars ($30); an increase in solid waste fees, a hundred dollars ($100).
Mr. Gimenez: Thirty-eight dollars ($38) and reduce it -- I think that five point five is more like thirty-
eight dollars ($38). And then you have — you reduce that from your ninety-nine dollar ($99) increase.
Ms. Henry: Exactly.
Commissioner Regalado: So the —
Mr. Gimenez: (Inaudible) which is already programmed in. So you're actually — you understand that the
twenty was already programmed in.
Commissioner Regalado: I understand that. I understand that. But what I'm trying to say is that on the
third scenario, the residential property owners of the City of Miami will be paying more than on the first
scenario. That's — is it not true that?
Ms. Henry: Yes.
13 7/11/00
Mr. Gimenez: Yes. And we're talking about not much. I mean—
Commissioner Regalado: OK?
Mr. Gimenez: OK. I'd say it's twenty-four dollars ($24) more than the first scenario.
Commissioner Regalado: OK. That's what I wanted to –
Mayor Carollo: Any further questions or statements?
Vice Chairman Gort: I think the one that you need to analyze in here, in one of these, we're looking into
it, is the future buildup of the City, especially the major buildings and major proposals that can really
bring up the tax base for the City of Miami. And since we're going out and making sure that we bring
promoters and we bring development to the City, we have to show that the City is willing to work with
them. By increasing the tax base, later on, we'll be able to reduce the residential, which is our goal.
Ms. Henry: Commissioners, this evening, we have – we have to forward a budget to the Financial
Oversight Board. In order for us to complete that, they are expecting us to determine what our millage
rate would be and all of our other fees, as presented. We did – they did give us a waiver. They gave us a
waiver from the last meeting, because of the fire fee discussion. But we are required to take some action
to present the City's budget. As you know, we'll be back. Your decision tonight will also assist us in
bringing forth the required, state -required resolutions for your trim notice. And that will be your millage
rate for trim and your non -ad valorem assessments. So your fire fee and your solid waste fee. So all three
of those items are important decisions that we will need to have from you. In order for us to complete and
put the final touches on this, to get it to the Oversight Board, we need some direction.
Commissioner Sanchez: I mean, you know, once again, we're at the bottom of the ninth, two strikes and
bases loaded, to make decisions based on these numbers. I mean, they're confusing in some ways. And
let me just elaborate a little bit on one. There's some concern that I have on Scenario Number 1 that the
burden will fall on the commercial side. And that's going to be, I see in the long-term, a problem for the
City, because what's going to happen is, as soon as these leases are done with -- they have basically have
picked up the ball and run on this with the parking surcharge, and we continue to pass the buck to them.
And what's going to happen is in the long run, we might have businesses that move out of the City. So
I'm concerned with that. Plan Number 3, one thing about reducing the millage is that we could always
refinance, and then from there on, add additional savings to the taxpayers of Miami. But, you know, it's a
tough decision. Basically, one's going to be saving twenty-four dollars ($24) and the other's going to be
spending like thirty-eight or whatever. The increase in the garbage on Plan 3, Commissioner Regalado is
right. It almost increases by a hundred dollars ($100). I mean, how are we able to, when last year, we
projected – and I mean that's what's based on the budget -- that we continue to make decisions, that we
continue to change things around. I mean, the taxpayers are out there. You know, they say, they have
things so screwed up, we can't even figure it out. And this continues to be a concern. At the last minute
today, we're going to have to make a decision. And it's just – you know, it's tough.
Commissioner Regalado: Can I -- Bertha, if things were to stay as is, in terms of the fire fee for the
residential and the new system of using the fire calls, you will have a surplus of one point three million
dollars ($1.3 million).
14 7/11/00
Ms. Henry: Thereabouts, yes.
Commissioner Regalado: What would this do if we were to apply this one point three to reduction in
property taxes?
Ms. Henry: It's basically a tenth of a mill.
Commissioner Regalado: A tenth of a mill.
Ms. Henry: Right.
Mr. Gimenez: That's one of the scenarios here.
Ms. Henry: It's scenario —
Commissioner Regalado: Which will be like about ten dollars ($10), twenty, fifteen dollars ($15)?
Mr. Gimenez: Seven dollars and fifty cents ($7.50).
Ms. Henry: Yes. The value — I mean, that's the scenario, the second one on that first -- Scenario 1 or the
second one on the spreadsheet.
Mr. Gimenez: The reduction for the average homeowner is seven dollars and fifty cents ($7.50)
(inaudible) Commissioner Regalado: And for the commercial?
Mr. Gimenez: Based on the assessed valuation, we don't think that it's going to make up the difference on
the increase that the assessment does, because you have a doubling of the assessment on commercials that
go into the fire fee scenario.
Commissioner Regalado: But the fire fee has a sunset date, right? Does it not?
Ms. Henry: Not that I'm aware of
Commissioner Sanchez: The parking surcharge does.
Ms. Henry: The parking surcharge.
Commissioner Regalado: The fire fee we're approving for five years.
Mr. Gimenez: The fire assessment is approved on a yearly basis by this body.
Commissioner Regalado: Well we —
Commissioner Teele: Mr. Attorney?
15 7/11/00
Commissioner Regalado: OK, OK.
Vice Chairman Gort: As soon as we can, we'll reduce the fire fee or we're eliminating the fire fee.
Commissioner Regalado: But what I'm saying is — what I'm saying is that, you know, if we were to use
that, leave the residential as it is, even with the slight increase in the garbage fee, that surplus will bring
some relief to every property, including the commercials throughout the City of Miami.
Mr. Gimenez: That's correct. But again, like I said, one tenth of a mil is really not going to make up the
difference with the commercials.
Commissioner Regalado: True.
Commissioner Teele: Mr. Chairman. Mr. Mayor.
Mayor Carollo: Go ahead, Commissioner.
Commissioner Teele: Let me say to the Manager, I remarked as I was walking in to one of your former
colleagues at the Fire Department how seriously, and how encouraged I am about how seriously you're
taking the job, particularly in the areas that have really not been the areas that as a Fire Chief, you spent a
lot of time in. And I think the normal human nature is that we spend time with what we know, and we sort
of leave things alone that we don't know. And I think once again, today, your statement, the seriousness
by which you approached this budget is very encouraging to me. And I commend you and I commend
your team. I would note to the Mayor, in that the Mayor was not here in one of the — earlier today that this
is the first time that Mr. Nachlinger has been with us formally, in this reincarnated life. He's been here
before. I guess some of you have worked with him. I only had about two months or six weeks. He
worked with me for six weeks and said, I've had enough of this, and went to Homestead. But his service
on Miami Beach and his lifetime service is certainly something that everyone that has known him
commends him for. And again, it's not too late. It proves today, the budget process, that two heads are
better than one. And having Bertha and Bob both here is just a homerun. If we could keep them both
together, I think we'll be in very good shape. I even see my horn -rimmed friend has joined us back here.
I don't know where he's been. So things are — as they say, God is in His heaven, and all is right with the
world. I really do think that the Management deserves a lot of credit for being extremely creative, and at
the same time, being concerned. I am very, very concerned about the shift in the burden to the
commercial as provided for in Option 1. And while I don't have a lot of commercial in the district that I
represent, Commissioner Winton, who has a disproportion, I mean, I think if he could live with Number 1,
I could live with Number 1, so to speak. But I don't think he is going to want to live with Number 1. So
I'm not going to want to live with Number 1, because like I said, it's not just about my district, it's about
the City. But when you have such a commercial, vibrant area that we're building all the way from the
Upper East Side through downtown and Coconut Grove, we all have to be concerned about what — and
Coconut Grove is just a stone's throw from Coral Gables and South Miami. So we need to, I think, take
that under advisement. And I'm going to look to the Mayor and Commissioner Winton as it relates to
Option Number 1. If you're not going to go with Option Number 1, then clearly, Option Number 3 has
merit from my point of view, because it spreads it around. It spreads it evenly. And, of course, it sort of
backs into what this Commissioner has been saying for three years consistently, and that is we need to
lower the millage rate. This would be a historic moment if this millage rate is lowered. Mr. Mayor, I
16 7/11/00
would hope that you would endorse it or give us a signal as to where you are, sort of like the old speak-
easy. You couldn't get in unless everybody had a sip from the cup. And so I really would hope that you
would come out before we vote on anything and say publicly pretty much where you are on this, because
there's obviously a lot of room for not being collegial. Let me just put it that way, any time you're dealing
with this. But at the end of the day, lowering the millage rate is the single most important thing that we
can do to send a message around this State that Miami has got its act together, that the Oversight Board
has done a great job, and let's pay the moving fee, storage/moving fees to help them move on down the
road. Because once you get the millage rate below nine mills, not only will it have been the lowest
millage rate in 30 years or more, it will also be a very clear statement that the City of Miami's finances are
in order, because the answer to every question that the Oversight Board and the Estimating Conference is
going to give you when they start looking at year three, and year four, and year five is, what are you going
to do there? Well, we'll make it up in millage. See, when you're ten mills, the way we were two years
ago, you couldn't say we were going to make anything up in millage, because you were at the ten mill cap.
Right now, if we were to approve this at the level that it's being presented under Option 3, there literally is
no reason for the Oversight Board anymore, because the fact of the matter is, at least as it relates to the
revenue side of the City of Miami — because, in fact, the answer to every question is, we'll make it up in
millage. So it makes for a lot of long and -- and gut -wrenching meetings become very short, because you
have that elasticity. I'm sure the Mayor will comment on what it will do for the bond rating, although I
think that's the most — that is a very important issue. It clearly is an issue that has been misunderstood by
the press and the public, because one of the conditions that we went into in the Oversight Board is that we
would not raise the rate. So we're not going to be refinancing until the end of the Oversight Board. I'm
not going to support refinancing, because refinancing is what got the City where we are today with an
Oversight Board, and that is trying to postpone today's cost in many ways, trying to get a savings here so
you don't have to make hard decisions. But I think at the end of the day, Mr. Mayor and members of the
Commission, one mil equals — what's the right number? Thirteen?
Mayor Carollo: Thirteen million.
Ms. Henry: Thirteen million.
Commissioner Teele: Thirteen million dollars. ($13,000,000). If anything goes wrong with the parking
surcharge — and we are in court on that — you can always come back the next year and say we can make it
up. I mean, we have a tremendous vulnerability in terms of a court case or a decision relating to that. And
I must say this: The parking surcharge is sunset. We don't need to wait until the end and then start trying
to look around. So the answer again is, where are you going to get the money when it's sunset? We'll get
it from the millage rate. I think we don't need to be overly optimistic and overly congratulatory about the
growth. Growth is slow. And I really wish, Mr. Manager, to Mr. Nachlinger or whoever you designate
that we could get a graph that shows how much money Bayside generated to the City of Miami, year one,
year two, year three. Because I'm going to tell you something. Even though Bayside is probably — what
is it? — The third most successful destination in the State of Florida? It took ten years before Bayside
really started throwing off money to the City of Miami. It takes time in development. I know that we all
talk about Watson Island. We talked about Virginia Key, you know. But that's patience. It's going to
take three years, two years to do a major construction project, at least two years to do a — three, the Mayor
is saying. And then it's going to take two years for it to mature and develop so that it's there. So, you
know, this growth thing is great. But the truth of the matter is — Vince Lombardi said it best — the future is
taxes. He didn't say "taxes." The future is now. So we've got to figure out right here, right now, what
17 7/11/00
we're going to do on the millage, on the fees. We all know that the fees as it relates to solid waste are
disproportionately low. I know nobody likes to hear that in the City in the homeowner areas, because it's
painful. But the fact of the matter is wherever the City line is — in my district, it's on 19th Street. The
folks on the east side of 191h Street Reverend Dunn lives on — 19th Avenue, I'm sorry — on the east side of
19th Avenue, Reverend Richard Dunn lives on, right on the east side of 19th Avenue. He pays the City
rate. The people on the west side of 19th Avenue pay a hundred and twenty dollars ($120) more for the
same service, essentially the same service. And so we don't need to kid ourselves that we've subsidized
the solid waste for too long. And the fact of the matter is we need to move the solid waste up to what it
costs to provide the service. Now, I'm going to — if the solid waste fee goes up, as outlined in Number 3,
I'm going to ask for, in July or the first meeting in September, a plan on how we can enhance solid waste
and how we can — because people don't mind paying, to some extent, if they're getting something better
or something more. So one of the caveats that I'm going to be suggesting that I'm going to support Plan
Number 1 or Plan Number 3 on is that we must make some improvements. And particularly, we're going
to increase the — The net solid waste increase is what? It's going to be sixty dollars ($60)? What's the
net increase from this year to next year under 3?
Ms. Henry: The seventy-one dollars ($71).
Commissioner Teele: Seventy-one dollars ($71). And under Plan 1, it's how much?
Ms. Henry: Twenty.
Commissioner Teele: So either way, there's going to be an increase. And I think under Plan 3, we have
to do something to provide more service, or better service, or more support for the Solid Waste
Department. Mr. Mayor, I want to commend you. I want to commend the Management, particularly Ms.
Henry and the team, because she's leaving, that — I mean, I don't want to overlook you, Bertha, is what
I'm saying, in the context that a lot of work has gone in here. One of the nuances, for example, is that on
the general obligation debt, they're proposing to lower, and I haven't heard a lot of discussion about that.
Is that still the —
Ms. Henry: Yes.
Commissioner Teele: Did you all brief clearly on that, that you're going to sort of trigger a lowering of
the scheduled rate of the general obligation?
Ms. Henry: Yes. Yes.
Commissioner Teele: So there's a lot of details in this. And I think there's been a lot of hard work. They
found the money that's there, the interest rates that's going, so the lowering of the general obligation debt
is going to have an even more dramatic effect. And I know that the Mayor has indicated to me three
weeks ago that he was going to work closely with the Management on the budget, that he thinks that we
would be satisfied, that we want to lower the rates. And Mr. Mayor, I hope that you will be embrace this
budget as something that you can support, because I think we need to try to move forward with a
relatively united front. Obviously, some of us may have different views, and I'm certainly not picking on
my friend to the left. I'm picking on my friend to the right. But I mean we have to respect each other.
And I would hope that whatever decision we make, we won't immediately be on Marta Flores tonight and
18 7/11/00
other shows tomorrow attacking each other, because this is obviously a very delicate process. And I
would appeal for collegiality, no matter what the decision is. So, Mr. Mayor, at the time you're ready to
make a motion, I'll be pleased to second, or make a motion, or just stay quiet on it and let's see how this
thing works out.
Mayor Carollo: Commissioner Gort.
Vice Chairman Gort: Mr. Mayor, I only have one question. My understanding, in the increase in solid
waste, that we do a 201, if we're to approve Option 3. That would eliminate the increases in 002 or 304?
Ms. Henry: No, it does not. It does not.
Vice Chairman Gort: You will continue to do so?
Ms. Henry: Right. It would just move —
Vice Chairman Gort: For twenty dollars ($20) each year.
Ms. Henry: Right. Because that increase basically supplants the — what would not be received in ad
valorem millage. I mean property taxes.
Commissioner Winton: Mr. Chairman.
Mayor Carollo: Go ahead, Commissioner.
Commissioner Winton: I only have a couple things to say, because I think Commissioner Teele and
Commissioner Gort have both said most of what I would say. So Commissioner Teele and Commissioner
Gort, thank you. One added piece of emphasis. If you look at the burden that the commercial property
owners in this community have shouldered -- you know, we've added something called a construction
debris removal fee, the supplemental waste fee, the fire fee, the parking tax. All of those fees are directly
— are directed primarily to commercial property owners. And if you look at the increase in projected
revenue, the projected increase in revenue over this six-year period averages one point seven five percent
per year. The projected increase in operating expenses is two and a half percent per year, which is what
leads us to that ten million dollar ($10,000,000) deficit in year six. There is no question in my mind, when
you have two and a half percent increase in operating expenses -- which is roughly inflation, so that's
rational, it's not an irrational number -- but you have a low projected increase in revenues. These
revenues could easily be this low or lower if we continue to press on commercial. And I deal with the
people that lease the space in these buildings. And if you don't have space leased in buildings, you don't
have any value. If you don't have value, then you don't have any real estate taxes. . So the key to
increased values is driven by increased occupancy and increased rental rates. And if we continue to put
more and more City services burden on those commercial tenants, they do have the option, as we've all
said, of moving very, very quickly at the end of their lease term, whenever that is. And tenants, by the
way, never move tomorrow, because they have leases. So whatever we do that impacts commercial
property owners, that impact is not felt if it's a negative. Negative movement is not felt for five years.
Could be three years, five years, seven years. But it's generally in that range of time. So if we stack one
more — so going to Option 2 here, which, in essence, doubles the fire fee for commercial property owners,
19 7/11/00
that's a huge, huge burden that could literally make a number — And I don't want to cry "chicken." You
know, there's going to be people that will continue on. But we can't afford to risk having new
development change their mind and go outside our City, because all we have to do is look at this five-year
budget and see that in six years, we're back in the tank. We don't want to be there. And we have an
option; with the momentum we have going in our community today, to erase that ten million dollar
($10,000,000) deficit through increased growth. Never mind attacking the expense side of the formula.
We can probably solve the problem through increased growth, and that growth is principally going to
come in the commercial and high-rise residential sector. And our job is to generate all the revenues we
can to provide the kind of services that all of us, it's clear to me, are working to provide in all of our
neighborhoods to lift everyone on this rising sea. But we run a great risk by making the wrong decision
tonight of stopping literally this whole process. So it's clear to me that the only option here that makes
any sense to me is Option 3. And so we've had a lot of discussion. If there's — if it's time for a motion,
I'm certainly ready to make my decision.
Mayor Carollo: Is there any other member of the Commission that would like to make a statement or ask
any additional questions? OK. Well, Commissioner Teele had asked me to make a statement. And I
don't think he wants to hear any more of my history lessons on the Tequesta Indians. No, you don't, do
you? Let me begin by welcoming Bob Nachlinger back. I guess some people, like some of us up here,
want to keep coming back for more punishment. But at least you had a break for a while. But it's good to
have you back, Bob. The team that helped put this budget together is a fine team, and I'm only sorry that
Bertha is leaving us. There were many fine people that have contributed to this, but the two main people
in the area of budgeting that finalized it, Bertha led it from the beginning to the end, but the two that
finalized it was Bertha with Bob and the Manager. When we met yesterday, I thought they had done a
fine job. But one of the areas that I was very concerned with was the fact that because of the court case in
Broward County, in one of the cities up there — North Fort Lauderdale, I believe it was.
Ms. Henry: North Lauderdale.
Mayor Carollo: We felt that it would be more prudent not to calculate fire fee with rescue together, just to
go with a straight fire fee. And by doing this in this coming fiscal year's budget, what it was going to do
was that it was going to increase the fire fee for the commercial real estate to approximately 110 percent.
Now, you're looking at 110 percent increase on a fire fee on top of so many additional increases that
we've thrown at the commercial side. Prudence tells you that, yes, we might be able to look better for this
year, maybe next year, to one side of the City, but it's going to catch up to us. And if we do it strictly that
way, it is going to hurt all of the City soon after. Why do I say that? Because you have a tremendous
amount of leases that are coming up now in many of the buildings in downtown, Brickell. You have a
tremendous amount of new construction that is not 100 percent full on the occupancy rates. So you're
going to be driving people to other parts of the County. At the same time, the last thing that we want to do
is to slow down the rate of new construction and investments that we're having in the City of Miami now
that is the highest of any period in the City's history. Therefore, when I saw the options that we basically
had, 1 and 2, I brought up Option 3 to Bertha, Bob, the Manager. The only thing that stuck on my in my
recommendations was the additional twenty dollars ($20) in future years to add it up. That's why I got
twisted on that one. But I think that with some additional dollars that we can find that can be resolved
year to year. I thought that by going below the nine mills on the general fund millage and having a total
millage of ten point two seven five that this would offset as much as we could bringing truth in millage,
and bringing the garbage fee pretty close to what it actually costs us for the service, the Mercedes-Benz
20 7/11/00
service that we provide. This is why we discussed the three twenty-five, after looking at what other cities
had. Our actual cost in garbage and trash collection is somewhere between three ninety, four ten,
somewhere in there, maybe even a little more than four ten. But three twenty-five takes us a long way in
getting there. What it does, as was mentioned before, is that it's bringing us the lowest total millage rate
definitely in the last 30 years. And once we're able to research prior years, you know, it might be 35, 40
or more years. But it's definitely the lowest total millage rate in the City's last 30 -year history. This is
what Wall Street looks at when they're measuring how healthy a city is. It's one of the main things they
look at in putting their whole recommendations. What this would do is that it is going to guarantee that
our bond rating is going to go up before the end of this year, at least; if not the end of this year, it will be
soon after. I believe that this would give the final push that this City needs to get its bond rating up. We
get our bond rating up, that's going to save the City additional serious dollars, not just in refinancing its
debt, but other things that the City might be able to do down the road. But even more importantly, what
it's going to say to many investors that are still undecided whether to come to Miami or not and invest
their dollars, many others that are here now and are looking, maybe, are they going to go to the next phase
in a project that this is a place to keep building on. And it's going to stimulate growth at an even greater
pace and an even more unprecedented pace than we've even had now. So what it will do is for the
additional twenty-four dollars ($24) that some residents will pay on this coming fiscal year, it is going to
guarantee that we could keep lowering the City l s taxes and provide better service, and have a real healthy
City in the following years. This, in effect, I think will lay the foundation to have a healthy and stable,
economically sound City. We would be a very sound, financially run City. What we're doing is we're
laying the cards out on the table to the residents of Miami. We're letting them know, this is what your
millage is, this is what everybody else pays for garbage, and this is what we have to pay, you know.
That's the bottom line. We've been subsidizing garbage, and I think this will stop a lot of the false
conceptions that have been out there. What I would like to do, though, is that I definitely would want —
and I don't know if we could do it at the same time that the County would send their bill out, and include a
mailing from us there. I think it's possible to do it. But if not —
Ms. Henry: We can.
Mayor Carollo: That's what I thought, from what I remember.
Commissioner Sanchez: The solid waste.
Mayor Carollo: We should send a letter explaining the tradeoff in the millage rate and the City's sound
health into the future, the lowering of the millage, that we've lowered it to the lowest total millage in the
last "X" amount of years, at least we know of 30. And then include all these other cities so they could see,
you know, what everyone else is paying, including unincorporated Dade County. And I think the
residents of Miami will understand it. But this is, I think, one of the major turnarounds in the City,
approving this right here today. None of these options, 1, 2 or 3 are going to be easy. Some are just easier
than the others. But once we look at all the different points that were key in the turnaround of this City, I
think that this one here today, if this is approved, will have to be one of those, because this is definitely
going to lay the foundation to have a healthy City financially into the future. Having said that, if there is
anyone that would like to present a motion for the resolution that is —
Commissioner Sanchez: Mr. Mayor.
21 7/11/00
9
Mayor Carollo: Yes, sir.
E
Commissioner Sanchez: Just a point of clarification, just on my looking at the numbers, and what the
numbers look like on Option 3. And I just, before I vote on this issue, I want to be very sure of this.
Based on the millage rate of the eight point nine, the property taxes, the residents of Miami will save
thirty-eight dollars ($38), correct?
Ms. Henry: Right.
Commissioner Sanchez: I want this on the record. They would also save an additional nine dollars ($9)
from the fire fee, correct?
Ms. Henry: From what was proposed, yes.
Commissioner Sanchez: Exactly. That is a total of forty-seven dollars ($47). Now, the garbage is the one
that increases to seventy-one dollars ($71).
Unidentified Speaker: Ninety-one dollars ($91).
Commissioner Sanchez: Subtract seventy-one –
Commissioner Winton: It increases by ninety-one, ninety-one.
Mayor Carollo: Well, but not –
Commissioner Sanchez: Well, when you add the other twenty dollars ($20) in the projected.
Mayor Carollo: It's seventy. Yeah, yeah.
Commissioner Sanchez: Don't confuse me here. OK? I just want—
Mayor Carollo: He's doing good right now. Don't confuse this.
Commissioner Sanchez: Don't confuse me. Don't confuse me. So seventy-one. Subtract forty-seven. It
gives me the twenty-four dollars ($24). That's all they're going to have to pay.
Ms. Henry: Right.
Commissioner Sanchez: OK. I'm ready to vote on the issue.
Mayor Carollo: That is correct. One last thing that I'd like to say before I open it up for a motion on this
resolution, based on Proposal Number 3 is that into the future, and particularly if we keep working
together like this, a lot of these projects that would bring in the recurring revenue that we need, the
Baysides and projects such as that, that people can enjoy and at the same time would bring recurring
revenue to us, we could get them off the ground quickly. There is no reason why that in the next three. to
five years, we cannot have completed just about every major development that we have discussed, from
22 7/11/00
the one here to our left in Coconut Grove to others that we need to develop, not only for the recurring
revenue, but for our residents and others in Greater Miami -Dade County to enjoy, to be able to go and
enjoy. One of the best assets that Miami, Florida has is waterfront. Law Enforcement Trust Fund. Mr.
Police Chief, if you can, for the next meeting, the 27th, if you could bring us the history over the last ten
years on how many millions of dollars each year have come from the Law Enforcement Trust Fund, plus
how much is sitting in the account right now, and how much is in the pipeline. I think you're going to
find that we should average, at the very minimum, four million or more a year. And I'm just bringing out
the number from my memory. It could be even more than four million on the Law Enforcement Trust
Fund. One of the things that I tried to do this past year, and we were close to doing it, as Ron Book, our
Tallahassee lobbyist told us when he was here last, but I think we could accomplish it this year with all of
us working together, is to get the same exception from the Legislature as we got on the parking surcharge,
on Law Enforcement Trust Fund dollars so that instead of trying to be creative in bringing the money into
the general fund, we could just transfer it directly into the general fund. And this could bring you a big
amount of dollars for quite a few years down the road. And you have enough money in the pipeline to
probably guarantee four million dollars ($4,000,000) a year for the next at least five years, even if no
additional dollars were put in. And that won't happen, of course. You have many other areas to go to, to
bring additional dollars; areas that I will get into at the next meeting in July for discussion, to try to bring
recurring revenue in this next fiscal year. But I commend all of you for having the vision to see through
the proposal that has been presented here. All of these are sound for the City, but I truly believe that
Proposal Number 3 is what's going to lay a real foundation for the long haul. So if there's no further
discussion, I'd like to ask for a motion on the resolution.
Commissioner Winton: Mr. Chairman, I would be happy to make the motion to accept the staff's
recommendation for the fiscal 2000-2001 budget, and accepting Option Number 3 as the preferred budget
model.
Commissioner Teele: Second the motion.
Mayor Carollo: OK. There's a motion and there is a second.
Commissioner Teele: Mr. Chairman, Mr. Mayor.
Mayor Carollo: Go ahead.
Commissioner Teele: I know this is the reverse of how it should be, but Mr. Manager, do you have a
professional recommendation on the three options?
Mr. Gimenez: Yes, sir. I recommend also Option Number 3 for a lot of the same reasons that have been
stated here. It will, I think, encourage economic activity in the City, and it will also give us the flexibility
that we need in the future if we have some kind of (inaudible) shortfall.
Commissioner Regalado: Mr. Mayor, just one comment. I would hope that in the hearings, we'll be able,
Mr. Manager, to discuss some of the numbers that you have presented. And I really have to commend
you, too, and your staff for all the options you have given this Commission. But one looks at the
expenditures from year 2001, 2002, 2003, and always, the expenditures are bigger than the revenues. And
as we were preparing for this meeting, I was looking over the draft Agenda, and I — of July 20, and I saw,
23 7/11/00
0
you know, a request for a hundred and thirty thousand dollars ($130,000) more for event maintenance at
the Orange Bowl Stadium. I don't know why, because we don't have that many games, additional games,
or half a million dollars to Dade County due —
Mayor Carollo: Commissioner —
Commissioner Regalado: Excuse me, Mr. Mayor. I'm just making a comment. And have --
Mayor Carollo: Yeah, but Commissioner, Commissioner I -- Can I ask you a favor, Commissioner, as
Chair? First of all, you're out of order. But I — I wanted to let you see if you had any additional statement
on this item. I'm not trying to be —
Commissioner Regalado: This is the statement. And Mr. Mayor, I am not out of order. I'm just making -
Mayor Carollo: Commissioner, look, you are out of order. When you're having a vote, which we were,
you can't bring anything up like this. Now, I don't want to be impolite. I just want you to get to the point.
You're not asking any —
Commissioner Regalado: The point, Mr. Mayor, the point, Mr. Mayor, is that I understand all the
arguments that you that support Option 3, and the administration and members of the Commission. I
understand that. But it would be very difficult to explain to the residents of the City of Miami why this
government does not have the ability of reducing expenses, and always placing the brunt either on the
commercial or in the residential. And that's my only comment. And I hope that I will not be any more
out of order. That will be my only comment. I hope, Mayor that you have the ability to explain to the
people of Miami that issue.
Mayor Carollo: Commissioner, let me say this to you. You have every right, just like every member of
this Commission, to speak within a reasonable time all that you want about any issue. But I want to be
very specific. Just because maybe things have been done a certain way, the parliamentary procedures are
that once you have a motion and a second, and you're going to vote, you don't have any further
discussion, statements or anything other. So I just hope you understand that. And I will gladly go out and
defend this or anything else that I would have to do on any program. Can you call the roll, please?
24 7/11/00
The following motion was introduced by Commissioner Winton, who moved for its adoption:
MOTION NO. 00-588
A MOTION ACCEPTING STAFF'S RECOMMENDATION OF
OPTION NO. 3 FOR PROPOSED BUDGET FOR CITY OF MIAMI
FOR FISCAL YEAR 2000-2001.
Upon being seconded by Commissioner Teele, the motion was passed and adopted by the following vote:
AYES: Commissioner Joe Sanchez
Commissioner Arthur E. Teele, Jr.
Commissioner Johnny L. Winton
Vice Chairman Wifredo Gort
NAYS: Commissioner Tomas Regalado
ABSENT: None
Vice Chairman Gort: Bob, I'd like to welcome you on behalf of the City of Miami Commission. And see,
if you would have been in Homestead, you would have been home by now, four hours ago. Welcome
back. Yes.
Mayor Carollo: Again, to all the staff, not just the generals —
Commissioner Teele: We need about three more motions here, don't we?
Mayor Carollo: Well, not necessarily on this part here for today. You need the resolution, unless you
want to get all of them, Bertha. You want to get all of them?
Ms. Henry: There are a couple of other things that we need to — just so that we are in compliance with our
Intergovernmental Cooperation Agreement. We do have to present the Oversight Board with our forecast
for the five years, and we've presented that to you for the general fund. What you have on the screen now
will obviously have to be modified. So we're going to ask -- It has the debt service pursuant to the debt
service schedule. The special revenue funds, you know, quite frankly, we have to make assumptions on
how we're doing. Many of them are grants, so. But we do need your approval for that with the
amendments that you just approved today, because that information is not reflected in anything that you
have seen for a forecast, and we'll go back and make those changes and present that to the Oversight
Board.
Mayor Carollo: OK.
Vice Chairman Gort: So I'll make a motion. I'll make the motion to amend the five-year plan to comply
with the decision that's been taken before.
25 7/11/00
Commissioner Winton: Second.
Mayor Carollo: OK. There's a motion by Commissioner Gort.
Commissioner Sanchez: Second, for discussion.
Mayor Carollo: Second by Commissioner Winton. Open for discussion.
Commissioner Sanchez: Thank you, Mr. Mayor. Bertha, where is the parking surcharge in the revenue
prof ected?
Ms. Henry: In which category?
Commissioner Sanchez: Is it under special revenue funds?
Ms. Henry: No. It's in the general fund.
Commissioner Sanchez: It's in the general fund now.
Ms. Henry: Right.
Commissioner Sanchez: You know, I brought this issue out. We continue to count on that money. There
is a sunset clause applied to that, and I know it very well, because myself and the. Mayor were in
Tallahassee. And one of the biggest arguments that we had was, to get it through the Florida Legislation,
was that we would commit ourselves to a sunset clause. Now, in the forecast — and I have expressed my
concerns to the City Manager that we are projecting on that amount, passing the sunset —
Ms. Henry: Commissioners, no, we're not. The parking surcharge is in effect till 2006. And this forecast
goes through 2005.
Commissioner Sanchez: I thought it was only to 2004.
Ms. Henry: 2006.
Commissioner Sanchez: OK.
Mayor Carollo: `6, yeah. I mean, we've got some time to work on that.
Commissioner Sanchez: We got some time to work on it. I thought it was to 2004.
Ms. Henry: 2006.
Vice Chairman Gort: Mr. Mayor.
Mayor Carollo: Yes, Vice Mayor.
26 7/11/00
Vice Chairman Gort: While under discussion, my understanding also is we pass this, but if anything
changes in the future, we can always change that plan. I just want to make sure we understand that.
Ms. Henry: On behalf of the Oversight Board, I would — the caveat that I would make is that they would
not want to see FY 2001 change.
Vice Chairman Gort: Correct.
Mayor Carollo: Mm-hmm, of course.
Ms. Henry: OK. But the forecast --
Vice Chairman Gort: But I'm talking about in the future. I'm talking about the `3, `4 and `5.
Ms. Henry: Absolutely. Absolutely.
Ms. Green: If things change and economics change with the City —
Ms. Henry: Absolutely.
Vice Chairman Gort: -- we can make changes to this plan. I think it's very important for people to
understand that.
Ms. Henry: Absolutely.
Vice Chairman Gort: Thank you.
Mayor Carollo: OK. Any —
Commissioner Sanchez: Just one last thing.
Mayor Carollo: OK, go ahead.
Commissioner Sanchez: Mr. Mayor, you know, I tend to sit back here, and about two years ago, when I
first got here, we went through the budget, and we basically did just about the same presentation and stuff.
And I remember going through the budget just about three times, calling it the "Ouija Board budget,"
because it was changed and modified so many times, we didn't exactly know what we had or where we
were going. So, you know, looking at the presentation that you've done, I know that two Commissioners
already -- and I think they speak for all of us — would like to commend you for not only providing the
proper information to us, but, you know, sticking to the right numbers. Because I remember there was one
time where we approved budgets. The numbers were grabbed from the air. And then they would come
back and say, well, that wasn't the amount. So I'm glad to see that we're heading in the right direction
here.
27 7/11/00
Ms. Henry: Throughout this process, we are working with the Estimating Conference of the Oversight
Board. Virginia Rutledge is here from PFM (Public Finance Management). She has been here each time
to make sure we stay on the straight and narrow.
Commissioner Sanchez: And we'd better stay on course.
Mayor Carollo: Again, to the Manager, the Assistant Managers and all the other staff, thank you for a job
well done. And to my colleagues, I thank you for having the understanding, vision and patience. And you
were presented with Option 3 between yesterday and tonight, and you were able to quickly grasp that this
was the best option for the City's long future. Is there anything else that needs to be brought before —
Vice Chairman Gort: We need to vote on it.
Commissioner Teele: Mr. Mayor, are we going to bring up the trim notice? Are you going to do the trim
notice?
Mayor Carollo: Next week.
Mr. Vilarello: On the 27tH
Ms. Henry: That will come to you on the 27th, via resolution.
Mayor Carollo: The 27th
Vice Chairman Gort: We need to vote on this.
Commissioner Teele: All right. We need to — let's be clear. We need a trim notice. We need a notice, a
resolution that accepts by resolution the increase beyond what the ordinance already does for the solid
waste.
Ms. Henry: Yes.
Commissioner Teele: That's going to have to be done by resolution.
Vice Chairman Gort: Ordinance.
Commissioner Teele:. See, I was hoping —
Ms. Henry: By ordinance.
Commissioner Teele: No. No, no, no.
Mayor Carollo: Well, you want to bring the trim notice? Can we bring it today?
Ms. Henry: Emergency ordinance.
28 7/11/00
Commissioner Teele: No, no. It does not have to be done — we've always done the solid waste by
resolution. Last year, we did it by ordinance to put in an automatic escalator. To increase it beyond that,
we just do a resolution.
Mayor Carollo: Sure.
Mr. Vilarello: Commissioner, the solid waste ordinance and the fee is in an ordinance. We have to amend
it by ordinance. We can do that.
Mayor Carollo: Yeah, we can do that, too.
Mr. Vilarello: An emergency ordinance. The other non -ad valorem assessments like the fire —
Mayor Carollo: Well, he understands that. He understands that. We spoke about that before.
Commissioner Teele: Well, but see, I'm trying to avoid that — I mean, if we -- This is my point, Mr.
Chairman. We get into these emergency ordinances, and then you're playing around with a whole other
set of dynamics. I've sat here through this once and seen it go south. I would much rather do this at the
next meeting by regular ordinance, and at the second meeting, do it, if we have enough time, by regular
ordinance, as opposed to an emergency ordinance. But it just seems to me that I — what I was hoping that
we would have is all of the legislation that supported this. But in any event, I would just like to make sure
that we're not doing emergency ordinances, and wind up with something getting into a situation that we —
Commissioner Teele: And I think that Commissioner Teele has expressed the preference of all of us here
in doing it that way. I need a roll call, though, on the last motion that was made.
The following resolution was introduced by Vice Chairman Gort, who moved for its adoption:
RESOLUTION NO. 00-589
A RESOLUTION OF THE MIAMI CITY COMMISSION, WITH
ATTACHMENTS, ACCEPTING THE PROPOSED BUDGET
CALCULATED AND IDENTIFIED AAS OPTION 3 FOR THE CITY
OF MIAMI, FLORIDA, FOR FISCAL YEAR BEGINNING OCTOBER
30, 2001; DIRECTING THE CITY MANAGER TO SUBMIT THE
PROPOSED BUDGET TO THE FINANCIAL EMERGENCY
OVERSIGHT BOARD.
(Here follows body of the resolution, omitted here and on file in the Office of the City Clerk.)
29 7/11/00
Upon being seconded by Commissioner Winton, the resolution was passed and adopted by the following
vote:
AYES: Commissioner Joe Sanchez
Commissioner Arthur E. Teele, Jr.
Commissioner Johnny L. Winton
Vice Chairman Wifredo Gort
NAYS: Commissioner Tomas Regalado
ABSENT: None
COMMENTS MADE DURING ROLL CALL:
Commissioner Teele: This vote is not just submitting a five-year plan. This is the numbers included in
the five-year plan as well, right?
Ms. Henry: Absolutely.
Commissioner Teele: OK. So I vote "yes."
COMMENTS MADE AFTER ROLL CALL:
Mayor Carollo: OK. It passes four to one. Is there anything else that you need at this meeting?
Mr. Vilarello: Mr. Mayor, perhaps, if I can. The solid waste ordinance does have to be amended. Those
rates won't go into effect until October 1St, giving us the opportunity to pass an ordinance in a regular
process as opposed to by emergency. What I think Commissioner Teele was talking about, just like we
adopt a fire assessment by resolution, the special assessment on an annual basis, in order to include the
solid waste fee on the tax bill, it's also adopted by resolution on an annual basis. And that's what we'll
do.
Commissioner Teele: And that's my concern, is that that has to be done by July 30tH
Mayor Carollo: Mm-hmm.
Mr. Vilarello: Correct.
Commissioner Teele: Because you want to keep it on the trim notice.
Mr. Vilarello: But the ordinance will be amended in due course, and all it has to do is be in effect before
October 1st
Commissioner Sanchez: Bring it on the 201h and we —
30 7/11/00
�i
L]
Commissioner Teele: Well, I mean, legally. But, you know, we also have an Oversight Board, and
they've asked that we have completed actions as opposed to —
Mayor Carollo: Yeah, by July 30tH
Commissioner Teele: By July 30th
Mayor Carollo: And if that's the case, then we're back to an emergency ordinance. Anyway, if there's no
further —
Commissioner Sanchez: Move to adjourn.
Commissioner Teele: There's a motion to adjourn, seconded by Commissioner Winton.
The following motion was introduced by Commissioner Sanchez, who moved for its adoption:
MOTION NO. 00-590
A MOTION TO ADJOURN THE SPECIAL COMMISSION MEETING
IN CONNECTION WITH THE BUDGET.
Upon being seconded by Commissioner Winton, the motion was passed and adopted by the following
vote:
AYES: Commissioner Tomas Regalado
Commissioner Joe Sanchez
Commissioner Arthur E. Teele, Jr.
Commissioner Johnny L. Winton
Vice Chairman Wifredo Gort
NAYS: None
ABSENT: None
Mayor Carollo: We're now adjourned.
31 7/11/00
There being no further business to come before the Commission, the Special Budget Meeting of the City
Commission of Miami, Florida was adjourned at 9:00 p.m.
ATTEST:
WALTER J. FOEMAN
City Clerk
SYLVIA LOWMAN
Assistant City Clerk
MAYOR JOE CAROLLO
(S E A L)
32 7/11/00