HomeMy WebLinkAboutCC 1984-10-31 MinutesCITY OF AAIAAAI
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COMMISSION
iw MINUTES
OF MEETING HELD ON October 31, 1984
(SPECIAL)
PREPARED BY THE OFFICE OF THE CITY CLERK
CITY HAL L.
INDEX
MINUTES OF REGULAR MEETING
CITY COMMISSION OF MIAMI, FLORIDA
OCTOBER 31, 1984
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ORDINANCE OR '
ITEM NO. SUBJECT RESOLUTION NO, PAGE NO,
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1 APPROVE ISSUANCE OF $20,000,000 INDUSTRIAL
DEVELOPMENT BONDS IN CONNECTION WITH
BAYSIDE DEVELOPMENT PARKING GARAGE R-84-1212
2 SETTLEMENT OF GATES CASE: APPROVE
AGREEMENT FOR RESOLUTION OF PENSION
LAWSUITS; FURTHER INSTRUCTING CITY
MANAGER AND CITY ATTORNEY TO IMPLEMENT
SAID SETTLEMENT, ETC. R-84-1213
3 ALLOCATE 1/12TH FUNDING TO PREVIOUSLY
APPROVED '84-'85 SPECIAL SERVICE AGENCIES M-84-1214
4 DISCUSSION ITEM: RELEASE OF PUBLIC DOCUMENTS
CONCERNING FORMER CHIEF OF POLICE, ETC. DISCUSSION
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11-42
42-43
43-47
MINUTES OF SPECIAL MEETING OF THE
CITY COMMISSION OF MIAMI, FLORIDA
On the 31st day of October, 1984, 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 to consider business of public import.
The meeting was called to order at 3:07 O'Clock P.M. by
Mayor Maurice A. Ferre with the following members of the
Commission found to be present:
ALSO PRESENT:
Commissioner Miller J. Dawkins
Commissioner J. L. Plummer, Jr.
Vice -Mayor Demetrio Perez, Jr.
Mayor Maurice A. Ferre
Howard V. Gary, City Manager
Lucia A. Dougherty, City Attorney
Ralph G. Ongie, City Clerk
Matty Hirai, Assistant City Clerk
An invocation was delivered by Maurice Ferre who then
led those present in a pledge of allegiance to the flag.
----- - - - - - -- - ------ ----- -- -- - ----- -- ------ ----
1. APPROVE ISSUANCE OF $209000,000 INDUSTRIAL DEVELOPMENT
BONDS IN CONNECTION WITH BAYSIDE DEVELOPMENT PARKING
GARAGE.
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Mayor Ferre: The first item deals with the approving of the
issuance of Industrial Development Revenue Bonds in an
amount, not to exceed $20,000,000 to be used for the
construction of the Bayside Specialty Center Parking Garage.
Mr. Manager?
Mr. John Gilchrist: Mr. Mayor and Commissioners, this is a
required step in order to get us on a priority list with the
state for the Industrial Revenue Bond issue. The Federal
Government in its Tax Reform Act in 1984 allocated a certain
amount of funds for each state and the states were allocate
it, accordingly and the State of Florida it is allocated by
County and there is a priority list, meaning the first one
there has the higher priority. In addition, the State
required that in order to get on that priority list, in
addition to the bond inducement resolution, which -we passed
here on October 10th, they wanted to have what i.1 known as
TEFRA hearing. That is the Tax Equity Fiscal Responsibility
Act, of IRS in 1982, so at the time we were unaware that that,
was going to be a requirement, but we are now, and this is
necessary to get on that priority list, should we in fact,
then determine to issue the Industrial Development Bonds for
the parking garage.
Mr. Plummer: Who would the bonds, if successful, be issued
to.
ld 1 October 319 1984
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Mr. Gilchrist: The City of Miami would issue the bond and
loan the funds from that, issuance to the Rouse Company local
firm, and they would be responsible for debt service on
,
that
Mr. Plummer: Then what part, if any, does the Off -Street
Parkin g Authority play, if we go that bond route.
Mr. Gilchrist: The Off -Street, Parking Authority could have
the management agreement for the parking garage under that,
but, they would not, be raising the funds to build the garage.
Mr. Dawkins: Pardon me, Commissioner Plummer. the profit
from the operation of the parking garage would go where?
Mr. Gilchrist: If I could answer that. We would follow the
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original agreement that, was brought before you at the time
we were talking about the Off -Street Parking Department,
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raising the funds and that, is a 50-50 share of the profit,
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after the garage has covered all of its costs, and that -
please correct, me.
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Mr. Gary: The way it is proposed is that the Management of
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the parking facility would be done by the Off -Street Parking
Authority. Under the case where the Off -Street, Parking
Authority would have sold the bonds, there was a 50-50 split
of profit after debt services. If the IDB's are sold under
the City, the Off -Street Parking would be the agency to
manage it, but the profit would not be split 50-50. It
would come to the City.
Mr. Gilchrist: Well, it, be split, 50 between the City and 50
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to the Rouse Company, that is what I was saying. That same
formula applies, except the profits come into the City as
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opposed to going into the Off -Street Parking.
Mr. Plummer: Does that, 50-50 split take place only after
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the total indebtedness, is that on an annual basis?
Mr. Gilchrist: It is on an annual basis, but the Rouse
Company would guarantee the negative cash flow if there was
in the start, up years. In other words, when the parkingr
garage becomes profitable it, was then to be shared 50-50.
Mr. Dawkins: So then you are saying that, the City of Miami
will sell $20,000,000 worth of bonds, build a parking
garage, and share while they are paying for it, half of the
profits with Rouse and Rouse would not, put up a penny
towards the construction of the parking garage.
Mr. Gilchrist: That, is not, quite the way it, is,
Commissioner. The City would sell the Industrial
Development Bonds.
Mr. Dawkins: For $20,000,000.
Mr. Gilchrist: Up to $20,000,000. Those funds would go to
the Rouse Company who would construct the garage and be
entirely responsible for the debt service. the City has no
responsibility for debt service. in that.
Mr. Dawkins: Okay.
Mr. Gilchrist: And they also are putting equity into it in
that they are guaranteeing the construction cost
Mr. Dawkins: Where does the 50-50 split, come?
Mr. Gilchrist: Well, in the operation of the garage, when
the garage becomes a profitable operation, the Rouse Company
ld 2 October 31, 1984
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would collect, those monies as the operator of the garage and
they would pay us 50% of those profits.
Mr. Dawkins: Who will operate the garage while we are
paying off the debt, service?
Mr. Gilchrist: Well, the proposal is that, the Department, of
Off -Street Parking Authority would be employed by the Rouse
Company as such to be the manager and operation of the
garage and they would be paid first the operating cost, so
they would be made whole for all of their costs.
Mayor Ferre: Go ahead, Commissioner.
Mr. Plummer: What, rate would these bonds be sold at?
Mr. Gilchrist: Well, we have the Bond Counsel here. I
would like him to respond to that, - Mr. Goldberg from
Sparber-Shevin. Also would like to say that, we need to call
this public hearing officially - I think we have to ...
Mayor Ferre: When I commence the meeting, I said the
following, and I would be happy to repeat, it, for you, if you
want..
Mr. Gilchrist.: Okay, I know it, was handed to ...
Mayor Ferre: This is a Special Commission Meeting for the
purposes of considering Industrial Development Revenue Bonds
of $20,000,000 at Bayside, and for the approval of the
settlement, of the Gates Case and those are the only two
things that will be discussed. Now, I have already made
that statement into the record. All right, Counselor, there
has been a question of Commissioner Plummer for you.
Mr. Paul Goldberg: Commissioner, I am Paul Goldberg from
the firm of Sparber, Shevin, Shapo and Heilbronner. At, this
point, in time it, would not really be possible to say exactly
what, the rates on this particular bond issue would be.
Mayor Ferre: Well, let me ask analogous question. Had they
been sold this week, yesterday or last week, or at the lastr
-` date that you have information, what, in your opinion, would
the bonds be sold for?
Mr. Goldberg:
Generally, Mr. Mayor,
bonds of this nature
sell within
a range of something in
the neighborhood of
maybe 75% to
80% of the current prime
rate, which generally
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we get.
Mayor Ferre:
And since the prime rate
has now decreased to
12% of last, week,
you are talking about
80% of 12%.
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Mr. Goldberg:
Generally that, owuld be
correct.
Mayor Ferre:
Okay.
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Mr. Plummer:
Then the question I
have is, do they
participate -
(they, the Rouse Company)
in the interest paid
on the bonds
to the City?
Mr. Goldberg: The Rouse Company under the IDB,
Commissioner, would be required to pay the debt service on
the bond, which would include interest - yes.
Mr. Plummer: Full debt service, and that interest would
accrue to the City?
Mr. Goldberg: This would be interest that they would be
paying which would ultimately go to the bond holders. They
ld 3 October 319 1984
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will paying the interest, and principal, which the bond
holders who are purchasing the bonds would be the ultimate
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recipient of. It, is a conduit type financing, Commissioner.
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Mr. Plummer: So then, let me understand that the decision
that, we are being asked to make today is not a decision to
definitely go this route, but, rather to put up on the list
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to be considered to possibly go this route.
Mr. Goldberg: That, is correct., Commissioner.
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Mayor Ferre: Are there any further questions? Yes, sir?
You have questions?
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Mr. Gilchrist,: We have to take public testimony.
Mayor Ferre: I understand that, John. Calm down, now. I
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want, to put, on the record two things. First, of all, Mr.
Manager, does this have the Administration's approval and
recommendation?
Mr. Gary: Yes, it does.
Mayor Ferre: Mrs. Dougherty, does this have the
recommendation as to legal form and content of the City
Attorney's office?
Mrs. Dougherty: Yes sir, Mr. Mayor.
Mayor Ferre: All right, are there any other questions from.
the Commission to either the Administration, to the Rouse
representatives, or to the Bond Counsel? If not, this is a
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public hearing. Is there anybody in the public who wishes
to discuss any issue relating to Bayside for this Rouse
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project? Nobody? Sir, if you have got something to say
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about Bayside, about the project, about this garage, or
about, anything that, is related, this is the opportunity in
this public hearing for you to say it.
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:
Mr. Art, Fernandez: Mr. Mayor, my name is Art Fernandez. I
am the the Business Manager to the Electrical Workers, the
RBEW-349, International Brotherhood of Electrical Workers.r
Yes, I have something to say about the Rouse Project. I
know that, I would like to see that, since we have a certain
amount of unemployment in City of Miami and Dade County
area, as me representing the workingpeople of Dade County
and also the City of Miami - I pay taxes in the City of
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Miami, and I would like to see that, all working people of
Dade County get, their portion of their work and I am asking
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Mr. Mayor and this Commission if there is any way possible
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g o the building trade will
to o on record to make a motion t,
have some kind of a project agreement on the Rouse job.
Mayor Ferre: All right, Mr. Fernandez, let me answer you
this way. First of all, I see an awful lot. of Mondale-
Ferraro buttons around. Usually only myself and you are
foolish enough to wear those things around Miami and you
will notice that I didn't, wear one today, but I would like a
show of hands - how many of you are here from the. AFL-CIO,
or any part, thereof, in support of this. From cooking at,
you, and knowing most of you by name, we have
representatives here - the carpenters, plumbers, engineers,
laborers and electricians. Is that, correct?
Mr. Fernandez: Yes, sir.
Mayor Ferre: The IBEW
(INAUDIBLE BACKGROUND COMMENTS)
ld 4 October 31, 1984
Mayor Ferre: And the pipefitters, who else? And the
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ironworkers, okay. And why? And the painters, so we have
got eight unions represented heres and I understand it,
eight trade unions.
Mr. Fernandez: I think you have most, or the majority of
building
Mayor Ferre: Of the trade unions.
Mr. Fernandez: That is right.
Mayor Ferre: Of the building trade unions. Now, let me ask
you this. As I recall Mr. Manager, they had delivered to me
a copy of a proposed agreement between the Rouse Company and
the AFL-CIO and their different unions, and that was based
on an agreement that had been signed by Baltimore in
particular, and before them, Boston with the Rouse Company.
I want to make sure that we understand several things,
Archie, so that we have a very clear understanding - one, if
this City and this Commission agree to go in this direction,
we need to understand a couple of things. First of all,
that there will be no work stoppage, no matter what happens
with other jobs, or other negotiations. If there is a
strike, there will be no work stoppage. Two, that there
will be no wildcat strikes, or any pickets that will go up
on this job that in any way will deter or stop the progress.
Mr. Fernandez: Absolutely, Mr. Mayor.
Mayor Ferre: Let me finish. Thirdly, that preference will
be given as much as possible and we have to work out the
foreman of that - first of all, to Miami people; secondly to
Hialeah and other cities who are sister cities in our
community; thirdly, to people who live in the unincorporated
areas of Dade County; and fourthly beyond that, to Broward
County. I would hate for us to do all of this and find out
that 95% of the workmen on this project are going to be
people who live up in Hollywood or Dania or Bro ward County
and we haven't tried to fill those jobs and there are
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working people in the City of Miami that are card carrying
members of your respective unions that do not have jobs ands
who are not working and yet we are giving the jobs to
somebody up in Palm Beach who drives down from Boca every
day to work as an electrician on the job.
Mr. Fernandez: Mr. Mayor, may I interject one thing?
Mayor Ferre: Wait a minute, I am not finished. Fourthly,
we have and do, and will continue to have sensitivity on
minorities. You know that we have made some major break
throughs here in the last couple of years, both the City of
Miami, and Metropolitan Dade County, under the able
leadership of our Commissioner Barbara Cary, major decision
won at the Supreme Court of the United States. The City of
Miami has also pursued similar types of endeavors. You that
specifically, since this is a City project on City property,
that there are minority requirements that are more stringent
and more important than any other city in the Unitqd States,
including Metropolitan Dade County, and you know, that you
are going to have to live with that. I want to make sure it
is clearly understood. I am finished now.
Mr. Fernandez: What I want to interject, Mr. Mayor is that
they agreement that you received, this agreement that will
state that we will not have any wildcat strikes, pickets,
jurisdiction disputes, etc. I think that the other
businessmen here will verify that. If I am not correct,
than one of them may come and correct me.
ld 5 October 31, 1984
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Mayor Ferre: All right, Art, , let, me turn it, over then to my
colleague, J. L. Plummer. It, is my recollection that, we did
discuss this before. I know for sure I sent to the City
Manager, he agreed, a proposed contract, which he in turn
delivered to the Rouse Company. It, is my understanding that,
the Rouse Company has responded. I need to know, first of
all, Mr. Manager, and J. L., since you are the memory bank
around here, have we passed a resolution?
Mr. Plummer: Mr. Mayor, it is my understanding we passed a
motion. I think a resolution would be in order - a written
resolution. Your terminology was that we had to bite the
bullet and we bit the bullet!
Mayor Ferre: Let me ask Mr. Plummer - Madam City Attorney,
the rule around here is when a motion is passed by this
Commission, by the end of that, meeting, or certainly by the
next regular Commission meeting, it is brought back in
resolution form. Now, since this matter was brought, and
passed two or three months ago, why has it, not, been brought,
back as a resolution?
Mrs. Dougherty: I believe there 'is going to be a public
hearing on this matter some time in the future.
Mayor Ferre; Public hearing on what matter?
Mrs. Dougherty: On the issue of ...
Mayor Ferre: Nevertheless, when a motion is passed, it is
formalized at the next meeting in the form of a resolution,
whether we are going to need a public hearing or not. My
question to you is, why did we pass a motion and not a
resolution?
Mrs. Dougherty: I will just, have to go back and research
the records. I didn't think that ...
Mayor Ferre: Would you please research that, and let me
know - would the Clerk let us know when the motion was
passed and I would like to have from the Manager and from
the City Attorney why we have not formalized this in ar
resolution.
Mrs. Dougherty: My assistant, has just advised me that all
we did was pass a motion to have a public hearing on the
matter.
Mayor Ferre: Okay, that explains it. So at this time
then, what we need to know is when will the public hearing
be called for that purpose? Did we set a date, Mr. Manager?
Mr. Gary: Yes, at, the meeting where this matter was brought
up, the City Commission passed a motion of intent what that
general policy was, but the specifically the motion dealt
with having a public hearing that, would occur at the time
that, the contract was signed. That, is why has not come back
before you and that, is why it, has not been scheduled.
Mr. Dawkins: Mr. Mayor, may I speak with the gentlemen from
Rouse?
Mayor Ferre: Yes, sir. Is the gentlemen from Rouse here?
Mr. Gilchrist: The gentlemen is Paul Raffel, representing
Rouse Company.
k m Ms. Paula Raffel: My name is Paula Raffel. I am the
Development Director for the Bayside Project. in Miami.
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m__ ld 6 October 31, 1984
Mr. Dawkins: Okay, well gentlewoman, are you familiar with
my requirements for the signing of the Rouse agreement?
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Ms. Raffel: In what respect?
Mr. Dawkins: Okay, I said that, 50% of the total dollars
had to go to minorities and 50% of the total dollars had to
go to Latin minorities and that, 50% would go to others. Are
you familiar with that?
Ms. Raffel: I am familiar with a minority agreement which
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has been seen before this Commission and that will be part
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of the document that, will be signed along with our lease
agreement.
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Mr. Dawkins: Okay, well, I am going to add another one and
I think I am going to get this Commission to vote on it,.
The Rouse Company must, , and from looking out, here now and
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knowing what, exists, we can build the Rouse Project without,
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any outside Dade County personnel, so I would like to inform
you, that when they come back with their contract, showing me
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the 50% total dollars to be with Black contractors and 50%
total dollars to be with Latin contractors, and the other
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50% to be with other contractors, that if it is not a Dade
County resident, then you show me why, and I will ... these
gentlemen here, it will be their duty to find whatever you
can't find in this City, so I would like to tell you that,
that, is another part, of my minority - before the contractor
is signed
Mayor Ferre: All right, yes Archie.
A.
Mr. Fernandez: Mr. Mayor, may I add one more thing to
Commissioner Dawkins? Each one of us business managers in
the building and trade, we have not only is it handed down
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by the Federal Government, we have a E.E.O.C. that, we have
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to abide by, Commissioner Dawkins. We have a percentage for
each female, Black, and also Hispanic, that we have to abide
by. I understand your question was to her, but that doesn't
apply to me. I have to live up to my E.E.O.C. percentages.
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Mr. Dawkins: Let me explain what, I said to her. Coming'
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back to what, you said, they get us hung up, me and you, in
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total numbers. I am not interested in total numbers
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anymore. I am interested in total dollars.
Mr. Fernandez: I see, I understand.
Mr. Dawkins: So now, whatever the total dollars is, that is
what I am interested in.
Mr. Fernandez: Right.
Mr. Dawkins: See now, when it, comes to them you tell
E.E.O.C. juggling the numbers, you are not, interested in
that. What, I am interested in, if it cost $90,000,000 to
d build Bayside, that the total number of those dollars remain
aYrr;, in Dade County.
Mr. Fernandez: Absolutely, I agree with that. fMay I ask
_ + you one more thing. Am I correct that this will have a
public hearing on the signing of a building trades
agreement?
Mayor Ferre: Yes, we have to do it, that, way because we have
got to let everybody have the opportunity to speak out on
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it.
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k F' Mr. Fernandez: All right, thank you, Commissioners.
ld 7 October 31, 1984
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Mayor Ferre: All right,,
Mr, Ernie Fannatto: Ernie Fannatto is my name and I am
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President of the Taxpayer's League, Miami and Dade County.
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I certainly concur with the gentlemen who said, and
Commissioner Dawkins said there should be Miami jobs for
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Miami voters and taxpayers. Our organization has always
said that, and I think it should be. Dade is going to foot,
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the bill. If this is a failure, who is going to pay for it?
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... the taxpayers, so let's give them the jobs. Now, I
think the issue is a clear-cut issue. If the Rouse Company
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is going to make a profit, and they are going to be doing
their responsibility, then I think they should put a surety
bond up compatible to the amount, of money, what the bond is
going to be, because if they are going to share the profits
then they should put a guarantee on it. Another thing I
would like to know, is what, this amount, of money that they
are going to charge for these parking garages? I don't, want
to hurt the tourists in this City, because you are talking
about jobs. You know, if we gouge them too much, they are
not going to come back and there is not going to be jobs. I
would also Mayor, to the Chair, I would like to ask the City
Manager if the City Manager would be good enough to tell me
how much the $20,000,000 is going to cost, how long the bond
issue is going to be - is it, 12%?
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Mayor Ferre: You have already asked all those questions.
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Why don't, we give the Manager an opportunity to answer?
Mr. Fannatto: Okay.
Mayor Ferre: All right, Mr. Manager.
Mr. Gary: Mr. Mayor, I have not computed ... I think what
Ernie Fannatto is asking is over a period of time, how much
money has to be paid back. I would like to first correct, or
at least, inform Ernie of the difference between this garage
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and a garage that, the City has participated in before, other
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bonds. This garage is being built, not with taxpayer's
dollars, but with Rouse money. It, is not being financed by
us, it is being financed by Rouse, so whatever costs - the
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initial cost is $20,000,000 - amortize that over 20 or 30�
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years ... Roger, have you figured out the cost for that?
Mr. Roger Carlton: Mr. Mayor and members of the Commission,
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my name is Roger Carlton, Director of Off -Street Parking.
This garage is different, as the City Manager has said. It
is being financed with an I.D.B. It, is issued by the City,
but, there is only one guarantee of the repayment of that,
debt, and that is the Rouse Company, therefore the taxpayers
are clearly not on the hook. The rates for this ...
Mayor Ferre: For either the repayment of the bonds, or the
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loss, if any. The taxpayers are only beneficiary if there
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is a profit. This is one of the few times when the
taxpayers of Miami are not on the hook for repayment of
debt, they are not, on the hook for operating losses. They
are only on the hook to make money.
Mr. Carlton:
What else can you ask?
Mr. Plummer:
I have to ask one question. That, question is,
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who has the
rights to set the rates of that,
garage, because
that could be a big determining factor as
to the loss or
gain.
Mayor Ferre:
Off -Street Parking Authority,
in conjunction
with Rouse,
who is stuck with having to
pay the bill.
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Obviously they
are going to do what, is best
to pay off the
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debt of that
garage.
ld 8 October 31, 1984
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Mr. Gary: The responsibility is the pay
y p y person who has to
back the note, and that, is the Rouse Company, but you must
realize too, that in any kind of economic venture, that your
rates must take in a lot of factors, a number of them being
pp y, as well as meeting your quarterly and
demand and supply,
annual payment requirement. If the Rouse Company decides
that, they are going to charge a rate where nobody wants to
park there, which I don't think they are going to do because
it doesn't make economic sense, then Rouse can't pay its
bill or its note, and therefore they are liable for the
debt, not, the City.
Mr. Plummer: Howard, if Rouse is setting their own fees,
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they cannot come back to us and say- "You set an arbitrary
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fee, City, and because of that, we are losing more money than
we should". So, that is not, the case if they are setting
the fees.
Mayor Ferre: Are you ready to vote now?
Mr. Plummer: Only one other question.
Mr. Fannatto: Well, Mayor, I would just, like to finish. I
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think that, you Commissioners should now exactly what they
are going to charge and then add it up and get ample profit,
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to pay the bonds back, but if they are going to go above
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that, like they are doing downtown, they are killing all the
merchant's business by over charging.
• Mayor Ferre: I thank you for it. I will respond for them.
They will be charging sufficient money to pay off the debt,
but, not enough so as not to attract, people to stay in the
garage.
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Mr. Fannatto: Well, I think it is a public hearing. They
should so advise the people so that we will get an idea what
they are doing, and not, gouge the tourists.
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Mayor Ferre: Ms. Raffel, on behalf of the Rouse Company,
would you have permitted me to have answered as I answered?
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Would that be your answer?
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Mr. Fannatto: I didn't quite get that Mayor, if you don't
mind.
Mayor Ferre: I
am answering for the
Rouse Company and I
asked permission
to do that for just this one case. Thank
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you very much, Mr. Fannatto.
Mr. Fannatto:
I have confidence in
you, Mayor, but the
point, about it
is the Rouse Company
wants to make money.
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They can make a
lot of money and they
hurt the economy and
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the jobs go down
the drain, that, won't
be healthy either.
Mayor Ferre: Thank you, Mr. Fannatto.
Mr. Plummer: Mr. Mayor, I only have one other question. On
the previous pursual of how we were going to finance this
was through the Off -Street Parking Authority. TYiere was a
mutual agreement struck up between the Off -Street Parking
Authority and the Grand Prix Race.
Mayor Ferre: That, is right.
Mr. Plummer: I now ask is that, same protection built, in for
the Grand Prix if we go this route?
Mr. Gilchrist: Yes, sir.
id
9 October 31, 1984
k-
Mr. Plummer: That is all I want, to hear.
Mayor Ferre: Are there any other questions? We need to
move along, Kenny, so good to see you.
Unidentified: All right, Mr. Mayor, I didn't want to
interrupt your discussion when you are trying to approve
this bond issue, but I wanted to say thank you for this bid
going to the right people, we think and I know that Howard
has been trying to work out, an agreement between Rouse and
the building and construction trade, which I represent, and
I would like to know - I have dropped off about four
building trades agreements down here and I would like to
talk to the representatives of Rouse and I make sure that,
they have a no -strike issue that, you were calling for, Mr.
Mayor, and our people are willing to do the work with no
work stoppages and they are ready to go and build your place
for you. I thank you, Mr. Mayor, for your consideration in
interrupting your discussion today. Thank you, sir.
Mayor Ferre: I would
like
to say to you that the
contract
that, you brought, over
to me was delivered to the
Manager.
the Manager and his
staff
are looking at it.
There are
discussions going on
with
the Rouse Company and
when they
get ready to respond,
at, which time we will have
a public
hearing for that purpose.
I am glad that you were
here. It
is important that you
were
here to show the interest
that,
you have shown.
Mr. Plummer: I just want, to remind the Rouse Company that,
tow years from today we will be going through the opening
gate. I still don't know why you picked Halloween, but I
will go along with it.
Mayor Ferre: Is there a motion?
Mr. Plummer: So moved.
Mayor Ferre: Is there a second on a resolution?
Mr. Dawkins: Second.
s �
Mayor Ferre: Further discussion? (MAYOR READS RESOLUTION
INTO THE RECORD) Call the roll. Hold on. This is a public
hearing, so anybody who wishes to speak - I see a gentlemen
raise his hand. Yes, sir? You are welcome to speak. This
is a public hearing.
(INAUDIBLE BACKGROUND COMMENTS)
Mayor Ferre: $20,000,000. Thank you for the correction.
Mr. Plummer: Just a slight error!
Mayor Ferre: Anything else? Let the record reflect that.
nobody else stood up and that everybody has had an
opportunity to speak. Call the roll, please.
ld 10 October 31, 1984
0 0
The following resolution was introduced by Commissioner
Plummer, who moved its adoption:
RESOLUTION NO. 84-1212
A RESOLUTION APPROVING THE ISSUANCE OF
INDUSTRIAL DEVELOPMENT REVENUE BONDS IN
AN AMOUNT NOT TO EXCEED $20,0009000 TO
BE USED FOR THE CONSTRUCTION OF THE
BAYSIDE SPECIALTY CENTER PARKING GARAGE
TO BE LOCATED ON CITY -OWNED PROPERTY
ADJACENT TO MIAMARINA BOUNDED BY
BISCAYNE BOULEVARD ON THE WEST, PORT
BOULEVARD ON THE NORTH, BISCAYNE BAY ON
THE EAST AND BAYFRONT PARK ON THE SOUTH.
(Here follows body of resolution, omitted here
and on file in the Office of the City Clerk.)
Upon being seconded by Commissioner Dawkins, the
resolution was passed and adopted by the following vote -
AYES: Commissioner Miller J. Dawkins
Commissioner J. L. Plummer, Jr.
Vice -Mayor Demetrio J. Perez, Jr.
Mayor Maurice A. Ferre
NOES: None.
ABSENT: Commissioner Joe Carollo
2. SETTLEMENT OF GATES CASE: APPROVE "AGREEMENT FOR THE
RESOLUTION OF PENSION LAWSUITS"; FURTHER INSTRUCTING
CITY MANAGER AND CITY ATTORNEY TO IMPLEMENT SAID
SETTLEMENT, ETC.
s Mayor Ferre: The only other thing we are going to tall-F
about today is the settlement of the Gates Case. All right,
Mr. Manager.
Mr. Randy Rosencrantz: Mr. Mayor and members of the
Commission, you have before you a resolution which will in
effect, indicate to the Court that you concur with the
settlement that had been negotiated by the Administration to
resolve the Gates Case. The Gates Case, as most of you are
probably familiar with are really seven different law cases
dealing with the Pension Plan and the Pension System for the
City of Miami. Some of these cases essentially allege that,
since 1939, that the City had not been contributing to the
Pension Fund the amount, of money that it should have been
contributing. The agreement that, you have before you now
has been in the process I guess three or four years in terms
of negotiations. The agreement that is before you has now
been approved by all of the unions within the City of Miami
that, are part of the employee work force. It has been
approved by the Board of Trustees of the Plan. It, has been
approved by the Board of Trustees of the System, the
actuaries for the Plan and the System have both agreed the
agreement as well as the actuaries for the City. The Gates
people have been a part of this discussion and negotiation
all the way through, have indicated that, they will agree to
this settlement when it gets before the Judge. So really,
if I can very briefly summarize it, there are really three
issues involved in the Gates Case. The one issues deals
with the management, and organization of the Pension Board of
ld 11 October 31, 1984
i
Trustees. It has been alleged that the present, Board of
Y{`
Trustees, or the present, management of the Pension System is
management controlled. The settlement, that, you have before
us changes the way the board is structured and it, changes
the way members of the board are selected. Also, the
agreement that is before you provides that each Pension
System, the Plan and the System, may each select their own
administrator and staff. They don't have to have a separate
staff, but they may if they wish. The third point, under the
organization, administration is, that, each board may have
its own separate offices if it so chooses to have separate
offices. The second issue that, was resolved in reference of
series of cases called the Gates Case, had to do with
funding. There was one major issue dealing with funding and
that, was the issue that is known as the unfunded liability.
The cases allege that for many, many years the City promised
benefits through its Pension System, but did not provide
r
sufficient funding to fund those benefits. If you strip
away everything that, we talk about in reference to this
case, it comes down to the point that we have worked out a
plan that we think is very reasonable and very viable to
provide the necessary funding to the Plan and to the System
r
to pay for those benefits. In the part, of the agreement,
there is a definite schedule that we will contribute to each
the Plan and the System, which will amortize the payments
for those benefits over the next 30 years.
Mr. Plummer: What does it, cost?
Mr. Rosencrantz: There is a schedule included in your
package, Mr. Plummer. At the end of the agreement there is
a schedule entitled Schedule A and the a schedule entitled
Scheduled B. The cost of this settlement - the settlement
is so structured so that each year the City will contribute
a prescribed amount, to the plan and to the system. Over a
30 year period, we will completely amortize all of the
unfunded liability that has been identified as of this time.
s t.
Mr. Plummer: What is this settlement, costing?
Mr. Rosencrantz: In terms of actual dollars, as of right
now, it is felt that the City owes to the systemr
$103,200,000 in terms of unfunded liability and it owes to
a4
the Plan $108, 900, 000. We have taken those two amounts of
money, determined an interest, rate based on what, the Plan
and System would have received upon it, and set up a 30 year
payment schedule so that, we are going to pay those amounts
E,
of money over 30 years. The actual impact on any given year
budget - there will be an increase in the annual
Fx<
appropriations required each year for each of these budgets,
but, it is not, an increase that is not unmanageable for the
City and it, will over, over the long haul, pay off the
unfunded liability.
Mr. Plummer: What is projected as the annual payment?
Mr. Rosencrantz: For the year '83-184, the estimated annual
payment is $18,100,000; for '84-185, the payment is
$21,800,000, and generally that amount will increase
g a'r 4p
approximately 5% each year, but there are to condilrions that
•.
I need to point out to you.
Mayor Ferre: Wait a minute, how much have we been paying?
Mr. Rosencrantz: We have been paying in the area of
$17,000,000.
Mayor Ferre: So this is not that much more.
F
ld 12 October 31, 1984
Mr. Rosencrantz: We have raised the base. No, it is not,
really that much more.
Mayor Ferre: All right, because people were getting
confused on these things, because they don't understand it.
Already, this is not something that, we reinvented, or found
all of a sudden in the darkness. This is something that we
have been dealing with, and we have been paying into over a
long period of time. Last year we paid one over
$17,000,000. How much did we pay to the Plan?
Mr. Rosencrantz: For year 183-184, the actual contribution
was $19,200,000 for last, year.
" Mayor Ferre: So that was last year's.
Mr. Rosencrantz: Yes. The year we are in right now that, we
anticipate that we will contribute $21,800,000.
�� Mayor Ferre: So in other words, we are going up from
x3{
$19, 200, 000 to $21 , 800, 000. Is that correct?
�Y
,., Mr. Rosencrantz: Yes.
Mayor Ferre: So in other words, what, we are going up is
$2,600,000.
Mr. Rosencrantz: For this year, yes.
Mayor Ferre: For this year. This is about 13$ - 14%.
Mr. Rosencrantz: Yes.
Mayor Ferre: That is a reasonable increase.
Mr. Rosencrantz: Now I wanted to explain to the City
Commission that, subsequent, years, the way this payment,
structure is structured, the way repayment is structured, is
Y. that we anticipate the payment, will be 5% additional over
what it was in the prior years, so we anticipate the
increase will amount to about 5% each year over what it was
in the prior years. r
Mayor Ferre: Who pays for the difference - should it be
more than 5%?
Mr. Rosencrantz: We have as part of the agreement, the
annual contribution to the Pension Trust Fund are divided
into two parts. One part of that agreement, deals with the
unfunded liability. There is a definite fixed schedule of
payments that we will make to that on each of the systems to
take care of that unfunded liability. The other item of
cause, which is a major item ofcost, is what, is considered as
normal operating. That is a cost that is variable. It
depends on how well the portfolio is doing and it depends on
well the stock market is.
Mayor Ferre: Well that, is my question to you again, and the
question is if we have ... how much money do we have now in
both the Plan and the System?
Mr. Rosencrantz: In total assets?
Mayor Ferre: Yes, in total assets.
Mr. Rosencrantz: As of the end of 1982, the assets for the
off
Mayor Ferre:
1982.
We have got to have more later figures than
ld 13 October 31, 1984
Mr. Rosencrantz: I am sorry - for 1983, the actual assets
for the Plan at the end of 1983 was $67,200,000.
Mayor Fevre: And System?
Mr. Rosencrantz: $1199500,000.
Mayor Ferre: Okay, so, because I figured we were getting
close to $200,0000000, so let, me ask you this ... That is
$1869000, 000 . Who pays for the shortfall. The problem has
always been as to who pays for the shortfall, if there is a
shortfall. Does it, come from the taxpayers, or is there a
set, agreement? Is it going to be set by actuaries. Are we
leaving it, open ended? Who decides that?
Mr. Rosencrantz: The way the agreement is structured,
provides that if the actuary disagrees on what that annual
contribution should be, there is a system to resolve that,
dispute. The final analysis, in the long term, is that the
City will pay for whatever you identify in the shortfall.
Mayor Ferre: The City?
Mr. Rosencrantz: The City, yes.
w. Mayor Ferre: This is the first, time in the history of Miami
that we have ever agreed, open endedly to pay for the
shortfall. Up until now, the City hasn't been in agreement,
F right?
Mr. Rosencrantz: I beg your pardon?
'� Mayor Ferre: Up until now, that has not been in agreement?
Mr. Rosencrantz: No, I don't think that is true, Mr. Mayor,
because the law, that created both the Plan and the System
provide that certain benefits will be provided to the
retiree.
Mayor Ferre: So the fact is, that, you think that in law, we
have had the obligation of paying the shortfall, is that
correct?
s Mr. Rosencrantz: Yes, I think that is true.
Mayor Ferre: So, this is not, new?
Mr. Rosencrantz: No, this is not new.
Mr. Plummer: What was the shortfall year?
Mr. Rosencrantz: That, is difficult to answer with a precise
number, because ...
Mr. Plummer: Approximate.
Mr. Rosencrantz: ... it,
$400,000,000.
Mayor Ferre: The shortfall.
was alleged to have been
Mr. Rosencrantz: But, that. ...
Mayor Ferre: Is that part of the $19,200,000?
Mr. Rosencrantz: No, I am sorry - when you said last year,
I was referring to the year prior to that.
Mr. Plummer: Yes, 1983.
r
ld
14 October 31, 1984
r
0
Mr. Rosencrantz: Yes.
Mr. Plummer: Okay, so that would be above the $21,000,000.
Mayor Ferre: In other words, if we are coming up with
$2198009000 ...
Mr. Plummer: That addresses the unfunded.
Mayor Ferre: ... what Commissioner Plummer is asking and I
need to know the answer to that, also, is the shortfall above
the $21,800,000, or is it included in the $21,800,000?
Mr. Rosencrantz: No, let me explain it to you this way,
because the calculations for the annual pension
contributions are extremely complicated. Let, me explain it,
this way. The suit alleged that over a number of years that,
the City did two things (1) it under funded its commitment
to the Pension System for the benefits to be provided and
the other part, they simply stated that you did not put
enough money into the till each year to pay for the normal
cost, that, you have. When we calculated out how to resolve
each case, we took all of that money that, was alleged to be
under funded and short funding, and whatever you call it, -
it doesn't matter what you call it, we put it all together
and said "This is what, it amounts to and this is how it, is
going to be paid off over the next 30 years".
Mr. Plummer: But it is the $21,800,000 the maximum
liability of the City for this year?
Mr. Rosencrantz: Yes, for next, year.
Mr. Plummer: Shortfall, or no shortfall?
Mr. Rosencrantz: The only thing that, would change that,
Commissioner Plummer, is when the actuaries do the actuary
calculations and the number comes out higher than that, and
a third independent actuary agrees that yes, $21,800,000 is
not enough money, then it would be higher than the
$21,800,000.
Mayor Ferre: It could go higher.
Mr. Rosencrantz: It could possibly go higher, yes.
Mayor Ferre: Let me ask you this, Randy. In your experience
as a financial officer of a major American city and your
experience as a financial officer in other local governments
that you have worked - in the Baltimore area and so on, do
you find that 10% of the general budget., which is what we
are almost at, is a reasonable amount of money for a City to
be paying into this pension system?
Mr. Rosencrantz: I think if you look at the statistics,
that is probably within the norm, yes.
Mayor Ferre: In other words, what we have is within the
norm of American cities of this size.
Mr. Rosencrantz: Yes, my understanding.
Mayor Ferre: Now, let me ask you this question. The
unfunded liability of $211,000,000, is that unusual for a
City this size? Does, the County, in other words, the
system in the State, or does the State system have a similar
unfunded liability? My point is, do governments have
unfunded liabilities.
Mr. Rosencrantz: Yes.
ld 15 October 319 1984
Mayor Ferre: If so, is this standard? Is this way above
standard, or is this this a little bit above standard?
Mr. Rosenerantz: I would say that, most systems that I am
familiar with have some degree of unfunded liability. I
would also say that the unfunded liabilities that is facing
the City of Miami seem to be as little larger than you
normally would find in other jurisdictions. Is the State
unfunded liability worse?
Mr. Plummer: Yes.
Mayor Ferre: Put, that, on the record.
Mr. Gary: Yes. Mr. Mayor, I would probably say ...
Mayor Ferre: In proportion. In other words, I am trying to
say in proportion to where the City is, the State unfunded
liability is worse than the City's.
Mr. Gary: Mr. Mayor, I would say that I think you are
asking Randy some questions that, ... you are asking for his
recollection. I think it would be probably appropriate for
a comparison to be done and I think what, you are going to
probably find is it is probably not within the norm. You
will probably find it, low. If you some specific ...
Mayor Ferre: You mean the unfunded liability?
Mr. Gary: In terms of major cities? I mean, it, is about, to
bankrupt other cities - major cities of the country.
Mr. Plummer: I will give you an example. The City of St.
Petersburg, right now, for every dollar they pay of salary,
pay 68% for pension.
Mayor Ferre: Well, the reason why I am interested in doing
this is specifically than none other than Mr. John McMullen,
because I want h.m, on this record, up in Vermont to eat
crow, okay? ... because Mr. John McMullen and the Miami
Herald have over, the last decade, slandered the City ofr
Miami on a continuing and excessive basis, telling us how
the City of Miami was bankrupt, how the City of Miami had no
way out - how the City of Miami was beyond control, another
one of the Miami Herald's attempts at eliminating the City
of Miami as a viable entity. The City of Miami is fine,
thank you! It is healthy, thank you! It has been healthy
for the past 15 or 20 years. The accusations of the 10
years ago, 9 years ago, 8 years ago, 7 years ago, 6, 59 49
3, 2, 1, are false. The City of Miami has been and
continues to be on sound fiscal grounds, Mr. McMullen, in
Vermont.
Mr. Rosenerantz: Mr. Mayor, if I may add to that, the
agreement, that is before you provides a very definite way to
deal with this issue, which I doubt that, very, very few
jurisdictions in the United States have and I think it is
probably a very, very strong thing on behalf of the City to
deal with this problem in this particular way.
Mr. Plummer: How much is the attorney's fees?
Mr. Rosenerantz: The provision that, we have in the
agreement is that the City will pay the attorneys that
participated in this. The actual amount of the fees, the
attorneys will submit their bills. The bills will be
reviewed and the Court will make the final decision as to
what attorneys should or should not be paid as it relates to
this case.
ld 16 October 31, 1984
Mayor Ferre: Well, who decides the bills to be paid, the
Courts?
Mr. Rosencrantz: Yes.
Mayor Ferre: Well now, as I understand it, we have Paul and
Thomson to deal with. We have Eddy Gong to deal with. Who
else do we have to deal with?
Mr. Rosencrantz: We have Mr. Sicking and Company - Dick
Sicking and Company.
Mayor Ferre: We also have yours truly, representative Ron
Silver.
Mr. Rosencrantz: Mr. Silver, Mr. Sandy Moore who represents
the Gates plaintiffs. I think that ...
Mayor Ferre: Now, who is going to represent the City of
Miami against all these wonderful attorneys?
Mr. Rosencrantz: The representation has been provided to
the City by the firm of Paul, Landy and Bailey. They will
review all bills that, are submitted by all the attorneys and
...
Mayor Ferre: Are we putting the fox in charge of the
chicken coop by doing that?
Mr. Rosencrantz: I don't think so, because I plan to be
part of that review process.
Mayor Ferre: Well you know, they all eat, at the Miami Club
together with Mr. Paul over there. There is one table where
Dan Paul sits and another table where Bob Paul sits and
another table where Parker Thomson sits and that is how
things are decided in Miami, for those of you that don't
know and my question is ...
Mr. Carollo: Dan, is that, right?
iw Mayor Ferre: ... is that proper for an attorney? I don't
know, it just seems to me that, ...
Mr. Rosencrantz: There has to be some way to resolve the
bills and pay for the time that the attorneys ...
Mayor Ferre: Well, the Judge is going to resolve that, but,
who is going to fight for the City of Miami?
Mr. Rosencrantz: At this point in time, I would say that
Paul, Landy and Bailey would be one of the participants.
Others that should participate in that I think it would be
up to the City Manager.
Mayor Ferre: Mrs. Dougherty, I would like your advice on
that, because it seems to me that perhaps we ought to get a
counsel from outside of this community, if we are, going to
have outside counsel to represent us if there is afty concern
about the billing. I assume that we are talking bills that
are over half a million dollars and will be probably over a
million dollars. Is that, correct?
Mr. Rosencrantz: You know Mr. Mayor, I have heard a lot of
numbers and I wouldn't repeat any of those numbers as part
- of the public record.
Mayor Ferre: I am not repeating any numbers. I am just
saying that I am guessing and this is a unilateral guess on
a
j
i
ld
my part. There is no question that those figures are going
to be well in excess of half a million dollars and maybe in
excess of a million dollars. I am not, making any statements
one way or the other, but, when the bills come in, before
anything is done, I would want the Administration and the
City Attorney to bring this specific subject to this
Commission for discussion and deliberations before we decide
what to do.
Mr. Plummer: Well, Mr. Mayor, I am ready to vote on this
today because it is a resolution. I think as it states in
the resolution that, there must, be ordinances brought, back
before this Commission to be passed and made final.
Mayor Ferre: Of course!
Mr. Plummer: I have one other question. Let's talk to the
important, factor, I haven't heard anything about it.
Mayor Ferre: What?
Mr. Plummer: The important, facts. Mr. Mayor, 10 years ago,
when I started working with the Pension Boards, unfunded
liability was in the neighborhood of ...
Mayor Ferre: Those were the days when you weren't too
friendly with Southeast Bank.
Mr. Plummer: You are correct.. No, Southeast, Bank was not,
friendly with me! They are now. We had an unfunded
liability of about $2,000,000 to $3,000,000. Today, we have
an unfunded liability in excess of $200,000,000. What
provisions are in this new agreement in relation to any
additional benefits? Because I want to remind the big
factor of unfunded liability accrued in two general areas.
The first, in buy back benefits, as well as the increase
from two to two and one-half percent per year and the second
item was that of the Yaeger pay plan across the board at
twenty-three percent increase in salaries. What, if any, is
written into this agreement about any future benefits, and I
am not talking to the State that says that before you can
grant a benefit, you must, have the proof of where you ar*
'm going to fund it. Any additional benefits would only
increase the unfunded liability. What addresses in this
agreement to that?
Mr. Rosencrantz: The agreement very, very specifically
addresses that problem, Commissioner Plummer, because I
think what, you stated is probably the reason that we are in
the process of negotiation agreements to start out with. In
the actual agreement itself, on Page 8 there is a paragraph
dealing with that, and on Page 9, the first paragraph deals
with that. What it says very, very specifically that the
City agrees to, is that when in fact, our additional
benefits are negotiated through the collective bargaining
process, or whatever process these benefits are negotiated
through, that the cost of those benefits will be amortized
over a 30 year period, beginning in the year in which the
change occurs. There is a very definite provision,.that says
that if, in fact, you do give a benefit, you ha'Ve got to
bear the cost of it over the life of the benefit.
Additionally, any additional benefits that are to be granted
by the administration or by the City, must go to each of the
affected boards before it becomes finalized.
Mr. Plummer: But, that would do nothing more than increase
the $21,800,000 contribution.
Mr. Rosencrantz: If you give additional benefits, yes. If
the City Commission approves additional benefits, then you
` ld 18 October 31, 1984
•
can anticipate that, that will cost you additional money. If
through some way you are able to decrease benefits, then you
can anticipate that, the cost, will be less.
Mayor Ferre: Okay, all we are doing here is voting a
resolution that authorizes you to continue to finalize this
thing, but it, has not been finalized yet.
Mr. Plummer: Well, it is more than that, Maurice. They
need this to go to Court.
Mayor Ferre: I realize that. We need to settle this in
Court, and we need to get it, all behind us and what, have
you, and this will hopefully do that. Is that correct?
Mr. Rosencrantz: Yes. Let me just briefly explain the
remaining steps of the process.
Mayor Ferre: Yes.
Mr. Rosencrantz: Monday, we hope to jointly go the Court,
and present to the Court this agreement and say to the Court
we have all agreed this is the way that, all of these seven
cases will be resolved. If the Judge concurs that this is
reasonable and proper and makes sense to him, he will then
authorize us to notify all the members of the class, the
class being the retirees. The retirees will have 30 days to
respond and come back and tell the Judge that "Look, I like
the agreement. - I don't like the agreement.", or there is
also a provision that they can opt out of the agreement,
which says that they don't like the agreement, apparently,'
and they want to be treated separately. One of the
attorneys can explain to you the ramifications of opting
out. After the 30 day period, and we see what kind of
response comes back from the retirees, we will go back to
the Judge at that point and say "Look, the agreement, we
have, we are comfortable and and in accord with it" and we
are going to recommend to the Judge at that point that he go
forward and issue a final order to resolve all the cases and
move forward with that. At that time, the effect of the
resolution that, you pass today will be to say to the Judge
that this City Commission has in fact, reviewed thqr
agreement, and that you will pass the necessary ordinance to
implement the final judgment as issued by the Court..
Mayor Ferre: All right, very good. I've got one last
question, Mr. Manager and that is, the whole question of how
much money comes out of this $186,000,000 greatly depends on
what the return on that investment is, because if those who
are investing those funds get 10% back, then we get
$189000,000, $19,000,000 back, and then we are in pretty
good shape. On the other hand, they get 7% back, we only
get $14,000,000 and then we have got to put up some more
money.
Mr. Rosencrantz: Yes.
Mayor Ferre: So, the question is, in the process of
determining the selection of who the investor is,ryou might
remember where we always got in trouble, the reason why J.L.
was so upset with Southeast Bank, is because Southeast Bank,
one time, because of Mel Reese, it was the bank that
invested the money and we were getting 3% return, or
something like that when everybody else was getting 6% in
those days, and as a consequence of that, we got in real bad
trouble. Now, I have read the document you gave me and the
thing that has me concerned about this is that it is the
Unions who give us a series of names. They appoint, and the
Manager appoints and somebody else appoints, and then the
Commission gets to appoint six, but those six come from a
list that they give us, four for each position.
ld 19 October 31, 1984
7
id
ip
Mr. Plummer: Four.
The City Commission appoints four.
Mayor Ferre: We appoint four.
Mr. Plummer: The Manager appoints two.
Mayor Ferre: How many names do they give us? They give us
six names?
Mr. Rosencrantz: Yes.
Mayor Ferre: Of which we choose four.
Mr. Plummer: Yes, two from each Union.
Mayor Ferre: How many names do we get to choose from is the
question.
Mr. Rosencrantz: Twelve.
Mayor Ferre: We have how many names?
Mayor Ferre: We have twelve names from which we choose
four, okay? We have twelve people that, they recommend and
we choose four of those twelve, right? Do those people,
once they are choose serve at, the will of the Commission, or
do they serve to the next, term?
Mr. Rosencrantz: They serve a definite term.
Mayor Ferre: How long is the term?
Mr. Rosencrantz: The term I believe is four years.
Mayor Ferre: So once they have selected twelve people, and
once we choose four from those twelve, as I understand it,
four from each board, so we have to choose eight, out of
twelve?
INAUDIBLE BACKGROUND COMMENT.
r
Mayor Ferre: That is what I want to make sure of, that we
have a choice of twenty-four and that we have cross movement
so that we could choose four out, of twelve and that we can
choose any of those twelve for any of those four positions.
Are you telling me that, we have three people ... you are
recommending three people for each seat.
NOTE: COMMISSIONER CAROLLO ARRIVES AT 3:53 P.M.
Mr. Don Teems: Let, me try it okay? The Fire will submit
six names to you. You will pick two of those six names.
The Police, and this is in the System - the Police will
submit six names to you and you will pick two of those six,
okay? The Plan is the same thing. S.E.A. will submit six
names to you. You will pick two of the six.
Mayor Ferre:
the six?
Mr. Teems:
you.
What if the Commission does not liace any of
I think we have got to submit six more names to
_ Mayor Ferre: Okay, I just want to make sure that, that is in
there, so that the Commission will always ... so that you,
you know, give us six people that are unacceptable to the
Commission ... see, the main thing that those people do, as
I see it anyway, Don, is choose a company to invest the
money, that is the main thing. They do a lot of other
j things, but to me ..,
October 31, 1984
20
•
Mr. Teems: That is the big thing.
Mayor Ferre: The big thing is, choosing who is going to
invest the money.
Mr. Teems: And trying to administer those money managers to
see if they are doing the right job.
Mayor Ferre: Keeping their eye on them to make sure they
are doing a good job.
Mr. Teems: See, Mr. Mayor, what, we have got in this though,
that we never had before, okay - we have certain
specifications that, these people have to fall under. There
were requirements that they have to have before they can be
submitted on a list, that we never had before. There are
some standards for the people and there is also some certain
things that they have to do to be able to stay on the
program.
Mayor Ferre: Don, that is what I want to get to. This is
my bottom line. I want to put this on the record. Randy,
and Mr. Manager, I want, to say on the record, I will not
vote for any solution to this very complex and long lasting
problem unless there is a clear out standard that must, be
kept and that if it is violated by a certain - and I don't
care if you do a three year running average, but if
everybody else in the Unites States is getting 10%
investments, you guys are get 5% investments, I don't care
• who the Manager is, I want us - (I am sure'you do too) to
deal with the issue and if you don't deal with, I want to
deal with - I, the Commission.
Mr. Teems: Mr. Mayor, we agree with you 190%.
Mayor Ferre: Tell me how you seek ...
Mr. Teems. It is our house okay, and we understand that,
and if our house isn't, getting the income in it that it is
supposed to, then we are going to lose in the long run.
Mayor Ferre: What I am concerned about, Don, is not you andr
the people that are there now. I don't have any problems
with any of you. I know you are worrying and you are going
to be conscientious and I am not, saying that 10 years from
now somebody is not, going to be conscientious, but what I am
worried about is that somebody, for whatever reason it may
be, chooses and investment corporation, a money manager that
will be money managing your money - it will be well over
$20090009000 by then and is not, getting the return on
investment that everybody else in the country is getting!
And then you come back and say "Okay, put up the difference"
and my successor and people that will be sitting here 10
years from now, other than myself will then at that time be
saying to you - wait a moment, you know Coral Gables and
Hialeah (well they are on the State system), Cincinnati and
Cleveland and Los Angeles and Phoenix and Dallas and Houston
all have return on investment on their pension systems and
plans that are 10% and the City of Miami is getting only 5%
and there is $7,000,000 or $8,000,000 missing there, and
there is no thing that this City can do except pay up the
money, and all I am saying is, that I want a safety fall
back position, Mr. Manager, so that, if we ever arrive at
that point, when you are mismanaging your money and asking
the taxpayers of Miami to put up the difference, then we
have a way of saying - okay, one year is fine, two years
maybe, but at the third year Ernie Fannatto is going to
stand up and just not take it, any more that is it!
Id 21 October 31, 1984
� may-
Mr. Rosenerantz: Mr, Mayor, I'd like to point out to the
Commission there is a specific provision in this agreement,
which indicates in effect what, you saying that, the Board, if
they do have a money manager that does not perform, that in
effect, if they don't meet your standards that, they should
move him on and get someone else. That part of it is in
here.
Mayor Ferre: No, sir. I don't want, this to be a squabble
in the year 1994. I want it, to be automatic. If for the
years 1991, 1992 and 1993, their money managers have been
mismanaging, I want it to :;rigger immediately and come to
the Commission for some kind of a solution. If they fall
into a pattern where they are mismanaging their money
clearly definable and under a certain basic formula, I don't
care if you kick it up to the Governor, or you kick it to
this Commission or wherever, but there has got to be a
solution, and I will tell you, I am not ready to vote for
this thing until you have that in there. I don't care how
you do it. You figure out your own - and it is in your own
best interest, Don.
Mr. Teems: Mr. Mayor, I know that, but that's ...
Mayor Ferre: You won't be around - you will be up in North
Carolina fishing and all of a sudden there is a big fight
happening here in Miami and all of a sudden the Commission,
or your successors have some kind of a deal with some
friends or something, and they are investing the money and
getting half of what, everybody else should be getting and
you have got, a problem and we have got a problem and there
is no way to solve it, because you ... go ahead.
Mr. Rosencrantz: Mr. Mayor, there is a provision and I
would advise you to look on Page 6, it is Item 3 and what, it,
states in effect that it is talking about the money
managers. Each board will establish written guidelines and
objectives against which the money manager's performance
will be measured. Whatever criteria that is best, that, is
there. This is why that particular provision is in here.
i Mayor Ferre: That is not acceptable to me, because there isr
no automatic kickoff. This is like a governor in a car, you
know, when it, hits 65 miles, that thing kicks off. I don't
want a beeper. See, what you have here is a beeper. It
beeps. You know, after they exceed 65 miles and hour, this
goes, beep, beep, beep! I don't want that. When it hits 65
miles an hour and the red light goes on, I want that motor
to cut off, or something to stop it, and I want it to be
automatic in here. Ron, you make it any way you want to,
and you kick it up to the Governor if you want or the
Supreme Court of Florida, or whoever.
Mr. Teems: Let me see if I can clear something up. The
Board right now, and in the future will rate money managers
as they work. At least once a year, I am not sure if it is
not more than once a year that the board rates these
managers. Management is going to have somebody on that
Board looking at, it. I can't, imagine the City
Administration having somebody on that Board looking at it
and then not meeting the standards and then not bringing it
back to you.
Mayor Ferre: Look, let me put it to you this way, okay? In
the year 1991, you are up fishing in North Carolina and the
Board is made up of John Smith, Willy Jones, Pepe Garcia,
and Juan Rodriguez, okay? ... and Juan Rodriguez, Pepe
Garcia and Willy Jones and Robert Smith all have some
friends that they think are real good. They chose them as
investors and these money managers - the name of the firm is
ld 22 4otoOer 31, 1984
0
Garcia and Garcia, okay? They are a very big local firm.
Garcia and Garcia now has invested the money and instead of
a 9.5% return, which is the average for its ..0 yes, and the
Bank of Venezuela is the custody for that - they are
custodians for the money and you are making 6%$ and the Bank
of Venezuela tells you that is not bad, it could be worse.
So and so did something else, and all of a sudden, you are
saying "Hey, come on. When I was on that system, that never
happened. I am not happy with that", and they say "Go to
your Board!" And you go to the Board, and your Board - it
just happens that, the President, of the Fire Fighters is also
Juan Garcia, and the President of the Police is Willy Smith,
and at, that point, you are into a situation where you don't
have much to say about that, and your Board is already
deciding whether it, could do, and I am telling you that I
just want to make sure when that, happens with Mr. Jones and
Mr. Smith, Mr. Rodriguez and Mr. Garcia, that, this community
and this City and you, up in North Carolina have a failsafe
operation that, automatically triggers off if somebody is
misinvesting your money, and it has nothing to do as to who
is on the Board, and who is not, on the Board, you get my
drift?
Mr. Teems: Yes, I get, your drift Mr. Mayor, and I am not,
sure ... I am going to look to some legal people so they
tell me how to do that.. I don't have a problem with what,
you are saying. I just think ...
4 Q'
Mayor Ferre: I want to tell you that, I told Joe Grassie and
• I told Richard Fosmoen, and I told Howard Gary and George
Knox that you would not have my vote, and Dean Mielke - is
rzY
he around? Mr. Mielke, you know that, I have told you when
you were working for Mr. Grassie, and I told you when you
were working for Mr. Fosmoen, and I told you when you
i...
working for Mr. Gary, that that was my bottom line
condition. And Howard, you and I have gone over it. George
Knox and I went, over it. Bob Paul and I have gone over it
<d=•
and I was there then. I talked to you Don, about it. I've
talked to Wally about it, Ron knows about it. I mean, there
g`
isn't anybody that I haven't talked to about this. That,
somewhere, there has to be an automatic kickoff, that if,
`
they are misinvesting the funds, as compared to other
investing money managers, that it comes back to some
p
governmental board. In other words, I want to save them
from themselves.
Mr. Gary: Well, Mr. Mayor ... do you want, to respond first?
Mr. Ron Silver: If I could respond to the Mayor on the
subject matter. I am Ron Silver, Attorney at Law, 444
Brickell Avenue.
Mayor Ferre: Who do you represent., Mr. Silver, for the
record?
Mr. Silver: I represent, the Miami City General Employee's
Plan, Trustees. This whole question about investments,
Number one, each person assumes a duty as a Trustee, has a
fiduciary responsibility, which means ...
Mayor Ferre: Assuming, I will be in Brazil by then.
Mr. Silver: No, that is not the case. You have fiduciary
responsibility, okay, for which there will be insurance,
okay? See, we have not been able to as a result of these
lawsuits, been able to obtain an insurance policy which is
fiduciary trustee insurance.
Mayor Ferre: Insurance policies, Mr. Silver, as you well
know, depend on the insurance company issuing the insurance,
{ ld 23 October 319 1984
and if they say we don't, want to insure the City of Miami
because we don't like the way things are going there!
Mr. Silver: We contend, Number one, that all the
fiduciaries have to attain trustee insurance, plus it must
be in Best book, rated by an insurance company that, has a
certain rating in Best book, but the fact of the matter is,
it, is not the mismanagement - see mismanagement of trust
funds is difficult to ascertain. What you have to do is
make the right, decision. There are no guaranteed returns.
Just because you or I have the best advice ...
Mayor Ferre: Ron ...
Mr. Silver: Wait, a minute. Just because you and I have the
best, advice ...
Mayor Ferre: You are talking about, apples, I am talking
about oranges.
Mr. Silver: Okay, then let me respond to your oranges.
Mayor Ferre: Talk about apples, talk about the same thing I
am talking about. Go ahead.
Mr. Silver: Okay, ask me a specific question then, and I
will be happy to respond to you.
Mayor Ferre: I am not worried about, the fiduciary
responsibility, Ron, and somebody misappropriating money, or.
` running off the Brazil with it, because that you can get
insurance for.
Mr. Silver: Right.
Mayor Ferre: We are not running for a crook. I am not
worried about crookedness, somebody being crooked. That you
have criminal courts to deal with. What I am worried about
is, the same mistake, and let's say that it is on an
honorable basis, and Plummer used to call it, the Southeast
syndrome, okay? And here is the way the Southeast syndrome
used to work. Mel Reese would go to the Miami Club forr
lunch and he would meet with the trustees of the ... those
of you who are smiling now are telling me that you remember
how this works and you know exactly how this whole thing was
fanagled. It was all honorable. There was nothing
dishonest about it
Mr. Silver: I heard about it when I was very young.
Mayor Ferre: Southeast was chosen. I'll tell you, you have
aged awfully fast! (LAUGHTER) It was all honorable and
above board and Southeast was a money manager! Now, we were
getting three and one-half percent and everybody else was
getting 5%. Finally, the employees got upset with it and it,
came to a head and this Commission, and I served on it, made
that in decision, back before Plummer - I was a
Commissioner, I wasn't even Mayor. It was when I was on
this as a Commissioner. Now, I want to tell you that those
things can happen. If it, happens for one year, I've got no
problem. Somebody made a mistake. If it happens for two
years, I've got no problem. What I do have a problem with,
is if keeps on happening and 'it is the Union Is fault who
control these pension plans and systems, and because of
friendships between Board of Directors and money managers,
it doesn't get changed. And even though the membership of
the employees and retirees complain about, it, you know how
sometimes that works.
ld
24
October 31# 1984
R
Mr. Silver: Well, what, we have done as far as the Trustees
are concerned now, if you guard against that happening, we
have independent firm, which is DeMarche and Associates,
analyze the three money managers. They are no way connected
with any firm whatsoever, to ascertain for us that, every
particular ...
Mayor Ferre: That is 1984. Are you guaranteeing that that,
will happen in 1994?
Mr. Silver: We can put that in an agreement that says that
we will have an independent firm, just as we have a ...
Mayor Ferre: Who chooses the independent, firm?
Mr. Silver: We can arrive at some agreement that ...
Mayor Ferre: If you let the City of Miami Commission, or
the Governor, choosing the independent firm, then I've got
no problems. See, that gives me a guarantee. I want, a
failsafe system.
Mr. Gary: Mr. Mayor.
Mayor Ferre: Yes, sir.
Mr. Gary: If I might, first, of all, in terms of their
conditions, I don't recall us having that conversation. If
you recall, the issue that got us into where we are now is
the fact that the Gates people allege that the money that
was legally theirs was not, expended properly when it was
under City's control and they spent money that was raised
for pension for social security purposes, and other
purposes.
Mayor Ferre: I am worried about the same thing in reverse.
Mr. Gary: Okay, if I may, the pensioneers have said the law
says, they are received monies for pension plans and the law
says that their board has a fiduciary responsibility for
getting the money and administering the money and that is
where we ran the issue with the Gunderson, if you recall F
Gunderson sat, on the Board, the Board would make a decision
and Gunderson would overturn the decision because he
controlled the money, you pay out, the checks and he would
therefore say I will get you on the other end". The
agreement, that, we have with the unions, and this is right.
That should have never occurred, for the mere fact that when
a Board such as a fiduciary board, when they make a
decision, that decision should be honored, regardless of who
writes the check, for the money is to be handled by them.
I'd like to go back to the Rouse situation. It doesn't make
sense for this Board not to want to make a profit on its
money and make it the highest profit, because if they don't,
they are the only ones that, lose. And particularly the
Board Members who sit at that particular point in time,
because those are the guys that always worry about whether
there is going to be money in the fund when I get out. What
occurs here now, they have a built, in system than first of
all resolves the old Gunderson issue, resolves the issue
with regards to their making their own destiny, but they
have a built in evaluation system in terms of evaluating
their investment and I can tell you for a fact they have -
those investors that have not done well - they have gotten
rid of, for the mere fact that they don't get rid of them
and they don't invest properly, then they are going to lose
when they get out, for pensions. You are not going to find
Mr. Teems not having a good investor, because when Mr. Teems
retires, he wants to make sure that, his money is in the
bank, so they have an incentive there, Number one. Number
Id
25 .1otober 31, 1984
two, the second incentive becomes the fact, that their thing
is what they have been doing in the past, they have been
really exceeding the market, and any excess money, they get
to keep Mr. Mayor, and so therefore they want to make it,
there is the incentive - the same thing with Rouse. So the
mere fact that it goes into the fund so when Teems gets
ready to retire, not only do they have enough money in the
fund, they have got a little more in terms of cushion and in
terms of inflation, so I think the issue of whether or not
the unions and the fiduciaries, or the people in that
capacity as a fiduciary are going to invest properly, I
think it is giving for the mere fact that they lose and it
does happen, and Mr. Mayor, if I might, the money, and this
was the issue of the Gates Case, the money, when it is
turned over to the Union, it, is the Union's fiduciary
responsibility to see that it is invested and expended
properly, and I don't think it, is the Commission's
responsibility.
Mayor Ferre: Absolutely, it is the Commission's
responsibility if we are coming up with taxpayer's money,
for any shortfall, you bet! And I am telling you right now
that I am not going to change my position of 10 years
standing. I will vote for this memorandum with one
exception - you come back with an acceptable solution that
if on a continuing basis the money managers of this
$200,000,000 system is going to not, invest this money
properly, and that, we choose to set the standards and those
standards aren't met, then give it to the Governor, I don't
care! Give it to the State Legislature. Let them decide.
it. Some governmental body needs to decide.
Mr. Silver: Mr. Mayor, can I just make two points - Number
one, there is nothing in the agreement which prohibits the
City from for instance, hiring somebody like I suggested to
monitor the money managers on a quarterly basis or a yearly
basis, or whatever the case might, be. Secondly the Court,
has jurisdiction over this matter for twenty years, so if
the City did in fact find that the money managers are not
doing, they just go right, into that Court..
im Mayor Ferre: Not acceptable. Not acceptable, and I think
Mr. Plummer and I have been talking about this. He knows
more about, it than I do, because he served on one of these
Systems for a while and I ... Plummer, am I wrong?
Mr. Plummer: Ron, it, is simple. The concern of the
Commission has to be in the area, not if you make money, but
in the shortfall and in the shortfall, then you are asking
this Commission to pick up that tab. What the Mayor is
saying is if you are going to demand that of us, we must,
retain some control.
Mr. Silver: You do have. There is nothing that, prohibits
you from doing as I suggested that you do, to monitor ...
Mr. Plummer: A monitor doesn't mean a thing. Monitoring
doesn't change ...
r
t
Mayor Ferre: And the monitor comes back and .says "Hey,
those guys are getting 3% less than they ought to be getting
and then the City says "Hey, you guys aren't going a good
job!" and so they ...
Mr. Silver:
Court ...
Mayor Ferre:
five years?
ld
Then they go into Court - they go right into
How long have we been in Court on this one,
26 October 319 1984
Mr. Silver: Yes, but anything ...
Mayor Fevre: And five years later we are here before
another Commission and Dan Paul is here with Parker Thomson
and Bob Paul and everybody else is involved and we get
another - you know - come on!
Mr. Silver: No, I understand. The reason our actuary from
the Plan side has approved this situation is because of the
definiteness of the agreement, whereby we would not, be
getting involved in disputes and that is the key to this as
well as being actuarially sound, but the fact, of the matter
is here there is that he has pinpointed in saying that the
only way you are going to do this is to resolve disputes
from occurring again.
Mayor Ferre: Okay, I will tell you what.. I will simplify
it for you and this is the way I am willing to vote unless
Plummer or somebody else wants to do it another way. I move
that the resolution as presented before us by the City
Attorney to take such steps as may be necessary to implement
such settlements, including and drafting of appropriate
ordinances and resolutions including the provisions for
resolutions of any impending liens for attorney's fees
before the City pays any attorney's fees where a pending
lien is involved, provided however, that before final
resolution and approval of this before the Court, that the
people that, are litigating this and the City Attorney and
the City Manager, come up with a solution that, specifically
resolves the potential case on the part or the Board of
Directors of both the Pension Plan and System, where there
is a failsafe system of identifying mismanagement of the
money manager's dealing of these funds and if, under a
specific guideline system, this occurs over a repeated
period of time, let's say three years, that there is a way
in which this reverts back either to the Commission or the
some governmental body or person, elected official to
correct. I don't care how you do it..
Mr. Rosencrantz: Mr. Mayor, I wonder if I could add - I
think it is possible for us to be able to accommodate,
im exactly what, you want. My concern is simply this - that the
agreement that you have has gone through a number of bodies.
If we make any substance changes to that particular
agreement would mean we would have to go back to that
process. I wonder if I could ask you to give me about two
minutes to meet with the City Attorney and our attorney and
see if we can legally can come through a way that can
achieve what, you want without going back through through the
process again.
Mayor Ferre: But I wish to state to you Mr. Rosencrantz,
and what. I am saying today is exactly what I told Howard
Gary, what, I told Fosmoen and what I told Grassie, and
actually Howard, in those days, you weren't the City
Manager, I think when you first started dealing with this
thing, you weren't even the City Manager. I said it to you,
I said it to Dean Mielke, specifically, and I said it to
George Knox, -and I want to say that I have not Qhanged my
position one iota, nor will I!
Mr. Rosencrantz: Could we have two minutes, and I think we
can do that. Thank you.
Mayor Ferre: Of course. We will take a five minute recess.
THEREUPON, THE CITY COMMISSION WENT INTO A BRIEF
RECESS at 4:29 P.M., reconvening at 4:35, with
all the members of the Commission found to be
present.
Id
27 October 319 1964
Mayor Ferre: We are back in session. The proposal was Just
made on the record that the City of Miami Commission set a
standard, like an average of ten similar sized cities who
have a similar sized pension plan and if our money managers
don't come to that average, then the City would have the
right to go to the Court in the next twenty years and have
the Judge intervene. The reason why that is not acceptable,
is because that again does not have a failsafe mechanism,
other than our appealing to the Judge. I don't, need any
mechanism to appeal to the Judge. Any time three members of
this Commission think that, somebody slipped and gone wrong,
we would appeal to the Judge anytime.
Mr. Teems: Mr. Mayor, what, you want, is you want, final
control.
Mayor Ferre: Nope!
Mr. Teems: Yes, you do!
Mayor Ferre: No I don't.
Mr. Teems: And you had final control over the last twenty
years, and that is the problem now.
Mayor Ferre: No, don't want final control. You have
control, but I want you ...
Mr. Teems: No, I don't have control now. You do.
Mayor Ferre: I want you to have it. I want you to have
control. What I don't want you to have is absolute control.
See, that is the problem around here.
Mr. Teems: You tell me, in a financial circle, where you
can give a guarantee, or you can get, a guarantee, and I will
take it, but, there is no such animal!
Mayor Ferre: Don't, want a guarantee.
ip Mr. Teems: You want, to be able to have the final say. F
Mayor Ferre: I don't want a guarantee. I don't want final
say. I just want you - your money managers to do a good job
and I want you to meet standards.
Mr. Teems: Well, let me tell you something - let me tell
you something, Mr. Mayor, okay? Seven years I have worked
on this and I will tell you the first time we got a step in
the right direction was when this man sat down with us and
started negotiating, okay? ... about three years ago, if I
am not mistaken.
Mayor Ferre: Three years.
Mr. Teems: We finally got all of the parties to agree.
Mayor Ferre: What is your point?
Mr. Teems: The point is, that, right now, if you are looking
for a guarantee, you are not going to find one.
Mayor Ferre: Don't want a guarantee.
Mr. Teems: So, we have no deal, okay?
Mayor Ferre: Fines
Id 28 October 319 198
Mr. Teems: Okays Understand what that means though. On
November 5th Gates go to Court to sue.
Mayor Ferre: That is fine.
Mr. Teems: I know, that, is fine! That is what you are
saying that is fine.
Mayor Ferre: That is what I am saying.
Mr. Teems: Okay, give me a guarantee!
Mayor Ferre: That is what, I said ten years ago.
Mr. Teems: Give me a way to guarantee itl
Mayor Ferre: There is no way ...
Mr. Teems: Give me ... you are asking for a guarantee. I
want to know what, it, is. Tell me how to do that!
Mr. Plummer: Don ...
Mr. Teems: We have got all the attorneys here don't know
how to do it.
Mayor Ferre: Wait a minute.
Mr. Teems: The City Manager doesn't know how to do it. I
don't know how to do it, but you want itl
Mayor Ferre: Are you finished?
Mr. Teems: I think.
Mayor Ferre: Are you finished? All right, it is my turn,
right? Let me answer you. No, I do not want control, the
Plan or the System, nor to choose the money managers, to
have the final say. All I want is a very simple mechanism
that if the money managers over a three period running
average do not meet the standards in America of what people
Im are getting in large systems and plans as a return, that yo:f
no longer will have the sole decision, in that a
governmental entity, whether it be the City of Miami
Commission, or the Governor, or whatever entity will have
irrevocably the right to disengage or choose or begin a new
process of choosing, but you can choose the money manager.
That is all I want. That, is all I have ever wanted, and
that is what, I have requested.
Mr. Teems: That is what, the Board does, okay? That is what.
the Board does. Now, yes, we give you a list, but every two
years, you vote on two of those people, just like we vote on
two of ours. Now, if we let that happen, then shame on us.
If you keep appointing the same people back to keep the same
money manager, then it is shame on you.
Mayor Ferre: We have been through the shame on Us, and I
don't want it to repeat.
Mr. Teems: Mr. Mayor, let me tell you something, okay?
What we have been through is twenty years of administrative
control of that pension system, and that is why it is the
shape that it is in now, okay? The Manager told you that -
mismanagement in the past, and it is true. Right now ...
Mayor Ferre: You run it. I do not want anything to do with
the selection process. What you have is acceptable to me.
What is not acceptable is if you have ... I do not believe
in imperial policies. I do not believe in your having the
total absolute right, There is no such thing.
id 29 October 31, 1984
Mr. Teems: I don't have the right to anything, Mr. Mayor!
Mayor Ferre: Well, the way you are structuring it, you have
absolute right. I don't believe in absolute rights.
Mr. Teems: You are wrong! You are wrong! The ...
Mr. Plummer: Wait a minute, Don. Excuse me, let, me ...
Mr. Teems: The Board has the right!
Mayor Ferre: Hey, I will tell you, there is a very simple
solution. If you mismanage and you don't get enough
return, you leave us off the hook! Don't ask the taxpayers
to come up with the money - with any more money. If you
want the taxpayers to come up with more money, than I want, a
failsafe system, period!
Mr. Plummer: Don, let me read to you from the agreement.
"Each Board will establish written guidelines..." The Board
will establish them - not, this Commission, but the Board.
Mr. Teems: And not the Union.
Mr. Plummer: I didn't say it. I read - I said the Board.
Mr. Teems: I know. He keeps saying me.
Mr. Plummer: Okay. "...and objectives against which money
managers performances will be measured." We have no
control, according to this document, okay? If a money
manager fails to meet such standards, they will be subject,
possible, to termination, at the sole discretion of the -
Board .
Mr. Teems: That is right.
Mr. Plummer: Yet, if they make a mistake, this Commission,
who is going to be asked to make up the shortfall, has no
control over that situation. Don, yes, I think this
is Commission is asking for control over that money which your
are going to be asking from us! That is only reasonable.
We cannot - we cannot write you a check without any numbers,
and that, is what this is providing. What the Mayor is
saying is, there has got, to be some control, if over a
period, as you and I know, over three years is an actuarial
assumption, that they don't prove to be a good outfit, and
you don't remove them for whatever reason, then something
automatically kicks in and triggers that removal. He is
willing to take it out, of your hands and the Commission's
hands, okay? Don, I don't believe you or anyone else can
expect this Commission to take and write a check for
taxpayer's money without some control. It has got to be,
over that shortfall - not over the Pension Board, not over
the monies that, are already in that Board, but the monies
that you will be looking to us for in a shortfall. that is
only reasonable.
Mr. Teems: Commissioner, you have under funded what the
Board's actuary has said, that the Pension System and Plan
has needed, for the last three, four, five years. That was
your decision. You made it. You under funded it. We had a
recourse - take it to Court. We did that. That is where we
are. Now the Court has jurisdiction, right now, okay?
There is no guarantee to you, but there is no guarantee to
me either..
Mr. Plummer: Except the wording of this agreement that
says the Board shall be the sole determining factor.
Id 30 October 310 1964
Mr. Silver: Mr. Commissioner, let me just it also says
in here that there shall be four independent members
selected by whom? ... by the City Commission.
Mr. Plummer: Submitted by the Unions. We are bound by
that.
Mr. Silver: But, you have the choice of selection of those
people that you both mutually agree on.
Mr. Plummer: That is correct, but they are making the list.
Mr. Silver: But they are your representatives.
Mr. Plummer: As long as we stay within their
recommendations.
Mr. Silver: But they, I would hope ... you have got to have
some reasonableness somewhere along the way. I would hope
that your appointees, okay - the people that, you appoint, are
going to come back to you and watch the Board and tell you
if something is not going right, or you are going to
require, as a Commissioner, them to do that, to you. Now, if
you don't require them to come back and tell you that there
is something wrong, you are derelict in your responsibility,
but you have that control.
Mr. Plummer: Ron ...
Mr. Silver: You have that control over those particular
people.
Mr. Plummer: We are not, speaking to that. We are speaking
to the taxpayer's unfunded liability, the shortfall. That
is what, we are speaking to.
Mr. Gary: If I might ...
Mr. Silver: I am obviously not making myself very clear.
Mr. Gary: If I might, Mr. Plummer, may I suggest, and maybe
the Union can agree - look on Page 6, Item Number 3.
Mr. Carollo: While you are all reading that, if I may
interrupt all of you for just a brief moment, if I may, and
I apologize, but 7- just can't sit back anymore and not speak
out. If I may, Mr. Mayor, the foreman of the Grand Jury,
Mr. Milton Vickers, who is back here today, if he has
anything that he wants to say publicly, I want to give him
the opportunity to come up and say it to me face to face. I
am not, going to permit this man to come here and be staring
down at my administrative assistant, be trying to be
_ intimidating with dirty looks, or be here thinking that I am
going to be intimidated by his presence here in staring down
at us. Now, if he has anything he wants to say to me, he
can come up here and say it publicly. Mr. Manager, if you
would sir, I would appreciate giving the opportunity. give
Mr. Vickers the opportunity to say anything he wants to say.
Mayor Ferre: All right, Lucia, read if you would, the ,..
Mrs. Dougherty: I've had two solutions proposed, Mr. Mayor,
and one is the Administration has suggested that what we do
is direct the City Attorney to pass an ordinance that would
essentially give the City Commission the right to make a
recommendation to the Pension Board to fire its money
manager, if it doesn't meet a certain standard. The other
suggestion is, and this would take the concurrence of the
Unions that are present here, we will put this in the
ld 31 October 319 19$4
0 0
agreement - the annual return on investments by money
managers must be equal to the level of return earned by
money managers of the five largest, governmental systems over
a three period, or the money managers will automatically be
changed. That leaves no discretion in the City
Commission...
Mayor Fevre: Fine.
Mrs. Dougherty: No control in the City Commission
whatsoever.
Mayor Ferre: That is acceptable to me. When you come up
with a solution - we are not going to take the taxpayer's
money and let you play loose with it. It is that simple.
Mr. Plummer: Let me ask the unions - is there a possibility
that, we could agree upon a percentage, that if it drops by
say, 5% - in other words, from what it was the year
previous.
Mayor Ferre: Won't be down 5%. Suppose there is a crash in
the bond market.
Mr. Plummer: Maurice, I wasn't saying 5%. I said like 5.
It could be 10, it could be 12.
Mayor Ferre: It has got, to be against ...
Mr. Silver: That, doesn't take into account market,
conditions. You know, that, could very well ...
Mayor Ferre: I agree with you and I think we have to have a
standard and the standard ... I don't mind as long as you
come with the standard. All I am saying, and I don't want
any part of choosing who the money manager's are, but if the
money managers you have on a three year running average
don't meet standards, then I don't see why the taxpayer's
should pay the shortfall. If there is no shortfall, I don't
care.
&L Mr. Plummer: If there is no shortfall, nobody cares if its
is acceptable to them.
Mayor Ferre: I don't know how you feel on this, because I
am not sure of Miller and Joe. You know, I honestly cannot
vote for something that is as open ended as that. That is
us not having any control over it. There is no way in God's
World that I could vote for an open ended thing like that
without any control and it has got, to have some kind of a
standard.
Mr. Carollo: Mr. Mayor, I apologize, but what I have been
able to hear at this meeting so far, there are too many
questions in my mind for me to make a vote on this today.
Mayor Ferre: As I said, I am willing to accept everything
but that one thing, and that is the one thing where I am
hung up and you have got to come up with a solutiofi.
Mr. Dawkins: Well, Mr. Mayor, the only hangup appears to be
that you say, and if I am in error, you correct me ...
Mayor Ferre: Yes, sir.
Mr. Dawkins: ... if there is a shortfall, then they accept
it.
Mayor Ferre: That is right.
id 32 00tober 31, 19$4
T
Mr. Dawkins: Or else don't make us responsible. Is that
what you said?
Mayor Ferre: That is rights If you can get them to accept
that, I willing ...
Mr. Dawkins: No, no. I just wanted to be sure that I
understood what you said.
Mayor Ferre: What I am saying is, Miller, that, if there is
a $200,000,000 ...
Mr. Dawkins: Shortfall.
Mayor Ferre: ... investment, and they are out there and they
are out there and they invested, and they are getting out of
that $20,000,000 return, okay - one year, and the next year
it goes down to $15900090009
Mayor Ferre: That is right, and everybody else in the
country who has $200,000,000 investment funds are making out
of that, same thing $18,000,000, and they are making
$15,000,000 and they are coming to us, or our successors and
saying you make up the $3,000,000, and we are saying "no".
Mr. Carollo: Well, Mr. Mayor, what I suggest we do is we
defer this item. I want, to have the opportunity to sit down
with Don and some of the other people to get a better
understanding for just what it is they want.
Mayor Ferre: Mr. Manager, we are about to ...
Mr. Dawkins: I second it.
Mayor Ferre: There is a motion to continue this matter with
a second at this point. Go ahead.
Mr. Carollo: Don, I want to have the opportunity to be able
to sit down with you to get a better understanding of what
is it you are trying to accomplish.
Mr. Wally Rodak: One of the problems we have is we have aR
Court date.
Mr. Carollo: What is the Court date?
Mr. Rodak: November 5th.
Mr. Carollo: November 5th? Next Wednesday?
Mr. Rodak: Monday is the Court date.
Mayor Ferre: I don't mean that. I am not ...
Mr. Rodak: We have to go before the Judge. We have an
agreement, or we don't have an agreement, they go to trial.
Mayor Ferre: Wally, I am not being critical of anybody
here, but I want you to understand that this -has been
hanging on for seven years, and for three years now we have
been making, as I understand it, some very substantial
progress, which I am very happy to hear. And now that after
three years with this tremendous progress that we have made,
five, six days before we go to Court and this issue has not
been addressed and I don't think anybody is surprised about
my concern. This is the very same one I have been
expressing from Day one for seven years.
Mr. Rodak: The biggest point I make I guess, is that these
people that, we submit to you and you ask us if they weren't
Id
33
October 319
acceptable, we can get more people, and we say "yes". The
thing is that they sit on staggered terms. Initially it is
set, up, this Board, you are going to have four names there
and two of those people only sit, for one year. The other
two will sit for two years, and then there will be two years
from that time on, and they will sit for a two year term,
but it is staggered. Before you talk about a three level,
after one year, you don't reappoint those people. The next
year the other two people come up.
Mayor Ferre: That is terrific. If you can also tell me
that, you are not going to look to the taxpayers to put up
any more money, but if you are looking for the taxpayers to
put up money, should somebody makes a mistake, than you have
got to give me some relief, man, that is the only way we can
go. You want the ad valorem taxpayers of Miami to put, up
more money, they you give me the fail-safe situation, it is
that simple. You want, to give me a fail-safe, then fine,
then don't ask me for any more money. Very simple. I mean,
I feel very badly about being the person to disrupt this
three years of tremendous progress six days before ...
Mr. Teems: You know, you are worried about the ad valorem
tax, but you have a really bigger problem without this
settlement, than the ad valorem tax to the citizens - much,
much bigger, Mr. Mayor.
Mayor Ferre: That may be.
Mr. Teems: Well, it, is the truth. It, is not, maybe, it is
the truth!
Mayor Ferre: Well, I tell you, I'd hate to be the one to,
after the tremendous progress that we have made in seven
years, especially in the last three, to be the ones six days
before to throw the monkey wrench in, but I ...
Mr. Teems: I know, but you are, Mr. Mayor.
Mayor Ferre: Oh, you bet! I will.
6L Mr. Teems: You have done it!
Mayor Ferre: I will, oh, you bet!
Mr. Teems: Oh, you have done it.
Mayor Ferre: I want to. I intend to. I realize that.
Mr. Teems: I think everybody here does.
r
Mayor Ferre: Absolutely! And I want to tell you that this
shouldn't be any surprise to you. I have been telling you
and others from Day one what might ...
Mr. Teems: Mr. Mayor, you never told me that, okay? You
might, have told the Administration that, I'm sure you did,
but you never told me that..
r
Mayor Ferre: Sir, I want to tell you that I have' repeated
this - Mr. Manager, you remember my conversation?
Mr. Gary: No, sir.
Mayor Ferre: You do not. Okay, all right, Mr. Mielke, do
you remember my conversation with you on these things over
the past, years?
Mr. Dean Mielke: We have had a lot of conversation on it,
Mayor, but I don't recall ...
Id 34 Ootober 31, 1984
r;
"pu
Mayor Ferre: Well, I will tell you, you put, me under oath
right now. You put me under oath right now.
Mr. Ralph Ongie: Do you solemnly swear the statement you
will make in connection with this case will be the truth so
help you God?
Mayor Ferre: I do. I want to state into the record that
over the past seven years, on different occasions, I have
talked with Mr. George Knox, Mr. Dean Mielke, Mr. Howard
Gary, Mr. Joe Grassie, Mr. Fosmoen and other members of the
Administration, specifically stating to them in the
discussions, that I would not, accept any resolutions of the
Gates, or pension matters, unless there is a fail-safe
guarantee regarding the investment decisions. If the money
managers did not properly invest those monies, should there
be a shortfall, and should the taxpayers of Miami be asked
to put, up the shortfall, and there had to be a fail-safe
situation involved in it. I further state into the record
that on different, occasions, several of the people that I
talked to in negotiations, and at that time, specifically,
the negotiators were Mr. George Knox. Mr. Mielke, you were
involved in it, as a negotiator, and I forget who the others
were, but I specifically, in the Manager's conference room,
in discussing this matter, specifically stated at that,
meeting, and I came up with the formula, there is a
memorandum on record; I specifically asked the
Administration to discuss this with the unions during union
negotiation agreements, before, not in this last round , but;
in the previous round, and maybe in this last round, but I
specifically stated in administrative sessions with the
Commission present, that, this matter be put on top of the
table for discussion, and I so swear.
Mr. Carollo: To the best of of his recollection.
Mr. Gary: Mr. Mayor, I don't recall those statements, but,
the issue I recall that you had a concern about, which was
the major issue at that time, was the composition of the
1W Board in terms of whether or not the City Commission wouldr
have appointees, and I recall that ...
Mayor Ferre: Mr. Manager, I must correct this for the
record. My interest always has been, and only has been in
the question of if there is a shortfall, who pays for it,
and if there is a shortfall, and there is money being
invested, how is the money being invested? I specifically
remember - and Mr. Gunderson was also involved ...
Mr. Gary: We can't ask him.
Mayor Ferre: ... during this period. I specifically recall
that the question, and Mr. Plummer will recall that the City
of Miami Commission was asked to come up with a shortfall,
- which is the start of this whole mess in the first place.
It was what, $4,0009000 or $5,000,000?
Mr. Gary: The issue in which we spent a lot off' time on
dealt with the membership on the Board, because of the
Gunderson issue and that Mr. Teems and the initial
negotiators when this thing was dead, and we met over in Mr.
Sicking's office, was to insure that they maintained
control, that the Commission had participation, and they
were concerned that the people who were placed on the Board
would be people who would be separated away from politics,
administration. That was the major concern and therefore,
we told them that,, and we must have spent, I don't know
about a month on two on this, or longer. We told them that
we thought this City Commission should have a right to
ld 35 Ootober 31, 1984
Participate and to resolve their problem in terms of whether
their best interests, their money would be taken into
consideration, we established criteria for those members,
and we said we would submit to the Commission six names and
if they kept putting names up that the Commission could not
accept, they would have to continuously put up additional
names. Those were the key ingredients. The second, and the
last ingredient was to insure that, the City had the ability
to pay and then we worked out those differences, but the
whole issue of who would be in control of, which was the
problem of the Gates Case, was something that had to be
resolved, and that, was the primary issue. I think in terms
of, as I stated before, in terms of whether or not the
unions or any person in that fiduciary responsibility who is
also personally liable will respond responsively in terms of
investment. I guess you could equate it in terms of your
pocketbook. Obviously, you don't, want, the greatest return,
and obviously you want the guidelines to be there. I would
suggest, ...
Mayor Ferre: I will produce, by the way, a memorandum, Mr.
Manager, to your predecessor, specifically speaking to these
points, and I will be guided by what that memorandum says
then, as today.
Mr. Gary: Mr. Mayor, I was not, questioning whether you
talked to my predecessor. I was just saying I don't recall
having that conversation with you, and my basic issue that I
had to deal with at that time were the ones that I was aware
of, and that we discussed at those meetings.
Mayor Ferre: Mr. George Knox was City Attorney and Mr.
George Knox was part of the negotiation. He also received a
copy of that memorandum. Mr. George Knox was involved in
the on -going negotiation for the past, three years before he
resigned as City Attorney. There is no question as to what,
my position was and is. We have a motion now that this item
be continued. Is there any discussion? Yes, sir.
Mr. Silver: Let me suggest an alternative which I don't
know if it is going to acceptable to you, but it might be a
1W way out of the situation for right now. As you know, we drf
have the Court hearing on Monday. So, my suggestion is,
that you consider that resolution you have with you, subject,
to us being able to arrive at, a decision which we can bring
back to you. At least we can go to the Court, on a status
conference basis and say that the Commission is at least,
with regards to everything else other than this one
particular item, in agreement, but before we could present
any settlement agreement for formal approval by the Court,
we would have to get this particular item resolved. Just so
we get an indication from the Commission to the Court.
Mayor Ferre: I've got no problems with that. I've got no
problems with ...
Mr. Silver: I think we might be able to work that out,
because, see we have to go back before all the boards and
all the unions now, if we do change that mattger, which
depends ...
Mayor Ferre: I've got no problems. Mr. Clerk, would you
read the motion that, I previously made, before the motion to
continue? Commissioner Carollo, Mr. Silver has requested
that we pass some kind of a motion to permit them to go
before the Judge and begin the process of settlement - not,
settling it until they come back to us in final form, but
specifically excluding that, section on Page 6.
Mr. Ongie: It is a long motion, Mr. Mayor, but I will try.
ld 36 October 31, 1984
A
0 0
Mayor Ferre: Go ahead.
Mr. Ongie: " I move the resolution as presented, provided
however, that before final resolution and approval by the
Court, that the people litigating this matter, plus the City
Attorney and the City Manager come up with a solution
wherein it specifically resolves the potential case on the
part of the Board of Directors on the Plan and System;
wherein there is a failsafe system of identifying if the
money managers are dealing effectively with these funds, and
if this occurs through a repeated period of time ..."
Mayor Ferre: In other words, the failure.
Mr. Ongie: Yes. "That this come back before either the
City Commission or some other governing body, or some
elected official for correction."
Mr. Silver: Just so we get, the intent of what the
resolution should be, because I think we are dealing with
that one particular issue, but for our purposes and for the
Court purposes, we have to understand that with the
exception of this one particular issue so we don't come back
again and we get, all involved in another situation - with
the exception of this one particular issue, that this
Commission is in agreement with the settlement agreement.
Mr. Carollo: If that is the intent, then that, is fine.
Mr. Plummer: Also, the attorney's fees.
Mr. Silver: Well, there is a provision in the settlement
for attorney's fees, which will provide that the Court will
set a reasonable attorney's fee.
Mr. Plummer: Well, I think this Commission has some right
as to what is going to be paid in attorney's fees.
Mayor Ferre: No, you don't. You are giving - you are
waiving that. You are letting the Judge decide that.
Mr. Plummer: As far as our own attorneys?
Mayor Ferre: Not our own attorneys. That is going to be
peanuts. You are talking about, ...
Mr. Plummer: Yes, but you know, you ought to see how big
elephants they are!
Mayor Ferre: Our own attorneys are less than $250,000. I
venture to tell you that the outside attorneys are going to
be at, least four to five times more than that. You want to
laugh now?
Mr. Plummer: No, the attorney fees.
Mayor Ferre: I don't find that funny, myself. I don't find
attorney's fees to be a particularly funny laughing matter.
I think we are talking about a big, big, amount of money
that a lot of people have been writing on, okay? So, I
don't find that to be particularly funny.
Mr. Silver: I don't think that is funny. I wasn't
laughing, Mr. Mayor.
Mayor Ferre: I wasn't talking to you.
Mr. Silver: All right, I just wanted to make sure. You
were looking - your eyes were turning in this direction and
id 37 October 31, 1984
0 0
I didn't know whether you were focusing on me or somebody
else.
Mayor Ferre: (INAUDIBLE) ... who looks at who these days. I
will tell you, I will go with this one that, Lucia has come
up with, and that, says, after the words "Pension lawsuits",
will read: ...."excepting for that portion found in Section
3, Page 6, regarding the money managers". The only other
correction that I would have is the one that Van just gave
me, which Lucia has said is acceptable to you, which down in
the body says: "...and resolutions and including a provision
in the final decree requiring resolutions ...".
Mr. Silver: Yes, we are accepting the first one. It is
fine with me. I am not, sure ...
Mayor Ferre: You are not accepting the second one?
Mr. Silver: Well, read that, again, I am sorry.
Mayor Ferre: Just give it to him - here.
INAUDIBLE BACKGROUND COMMENTS NOT ENTERED INTO THE PUBLIC
RECORD.
Mayor Ferre: Now, for me to accept this motion of
Commissioner Carollo, who has made a previous motion to
continue this - you have got, to convince him.
Mr. Carollo: I will rescind that motion, Mr. Mayor.
Mayor Ferre: What? You are all set? Okay. Then, will
somebody ... is this acceptable to you?
Mr. Brian Goodkind: Mr. Mayor, if I may, my name is Brian
Goodkind. I am from the firm of Thomson, Zeder. We
represent, the Gates plaintiffs in this action. The second
provision that you have there, the second change in your
resolution, would you please read that, or may I see it?
Mayor Ferre: Yes, of course you may. Here it is.
Mr. Goodkind: Mr. Mayor, if I may. There is a ehargingIr
lien that has been filed in this case, suggesting that his
firm is entitled to fees, and that, is a matter that will be
and has to be resolved by the Courts. It is strictly a
political move to put, anything in this resolution that,
pertains to that issue whatsoever. The City, and you can
ask ...
Mayor Ferre: What do you mean, political? Do you mean
Democratic party vs. Republican, or what, kind of political?
Mr. Goodkind: I think your Honor knows what I mean.
Mayor Ferre: No, I don't know. Tell me on the record.
Mr. Goodkind: On the record, by political move, .I mean a
move that is unnecessary to resolve this matter. It is
strictly a move for publicity reasons.
Mayor Ferre: Publicity by who?
Mr. Goodkind: By Mr. Paul, your Honor.
Mayor Ferre: By Mr. Dan Paul?
Mr. Goodkind; Yes. Mr. Mayor, if I may, I think your own
attorneys, Paul, Landy, Bailey attorneys will tell you that
that, language is completely unnecessary to legally protect
ld 38 October 319 195,
the City in this case. The City will pay the attorneys fees
to whomever the Courts tells it to pay and the language is
totally unnecessary. I have been advised by superiors in my
firm that my firm will not recommend to the Gates
representatives that, they settle this action if that,
language is in that resolution.
Mayor Ferre: Okay, Mr. Paul.
Mr. Dan Paul: Mr. Mayor, my name is Dan Paul.
Mayor Ferre: Are you seeking political publicity, Mr. Paul?
Mr. Dan Paul: No, Mr. Mayor.
Mr. Carollo: Is this under oath, or not, Dan?
Mr. Paul: Either way. This provision is necessary to
protect the City, so the City doesn't have to pay twice.
Everybody concedes that the lien has to be resolved by the
Court, and it provides that, the final decree, if it be
entered, would provide a method for doing that and I think
it is only appropriate and all the lawyers agree that it is
appropriate except the people who don't, want the lien set.
Mayor Ferre: Lucia Allen Dougherty. Would you give us
please, a legal opinion?
Mrs. Dougherty: Mr. Mayor, we had agreed on some language
that said that we were going to resolve all pending liens,
and that is something we have to do anyway. There is a lien
pending and that is something that I think is appropriate to
recognize in this resolution.
Mayor Ferre: Does that mean you agree with it, or you
disagree with it?
Mrs. Dougherty: Yes, I agree with it. I don't think it
hurts. It doesn't ...
Mayor Ferre: Where are the attorneys for Paul, Landy,
fm Bailey? r
Mr. Robert Sondak: My name is Bob Sondak from Paul, Landy,
Bailey. Since what I have been trying to work towards in
this matter in the last two years has been to resolve it
amicably, might I suggest that the Commission could make
recommendations to the Court and your attorneys will urge
the Court to do that in a final decree, but the wording of
the final decree by a Court is up to the Court, and so,
could I just recommend that the resolution be amended to
delete the reference to what the final decree has to say and
I think that might alleviate everybody's concern, and get us
back on the track towards resolving it. I think the matter
of trying to resolve the over-all matter is a good
settlement, for the City. It is something that we might be
able to accomplish better by deleting that one aspect of it
as a change from the last draft of it that I'saw this
morning.
Mrs. Dougherty: I am not, opposed to doing that.
Mayor Ferre: Paul?
Mr. Paul: I am not sure what is proposed, Mr. Mayor, but
obviously that matter has to be resolved and everybody
concedes that, it is appropriate to refer to it in this
resolution, so I've no objection to saying, in this
protection, including requesting the Court to include a
provision in the final decree, resolving the attorney's fee
lien. I've no objection to that.
ld 39 October 31, 1944
Mr. Sondak: Mr. Mayor, I would go even further than that.
The advice we are giving to the City and we have given it
consistently is that the City should not, make any payment of
attorney's fees to the Gates plaintiff lawyers until this
i matter is resolved by the Court, and everybody is in
agreement on that, because it would be very foolhardy for
the City to do anything otherwise.
Mr. Paul: That ought to be in the resolution so that there
is no question about, it.
Mayor Ferre: Lucia, would you tell us where we are now,
legally?
Mrs. Dougherty: You have my resolution.
Mayor Ferre: I mean, is this the only thing we are adding
then? What, Mr. Paul added, we are not going to utilize
that, is that, it? I am asking you specifically (INAUDIBLE)
...this discussion. Are we talking about, this, or are we
talking about, this?
Mrs. Dougherty: This on the second page. He wanted to
delete this requirement that the final decree ...
Mayor Ferre: Mr. Paul has recommended it. You don't want
it in there?
Mrs. Dougherty: No, I am not opposed to it. They don't, want
to do it, so what, they are saying it is going to say: "and
including a request, to the Courts".
Mayor Ferre: Is that, acceptable to you? Go ahead and talk
to them. We will take a few minutes while the lawyers
discuss this. We are going to break up in a few minutes.
INAUDIBLE BACKGROUND COMMENTS NOT ENTERED INTO THE PUBLIC
RECORD.
6L Mrs. Dougherty: For the record, your Honor, Section two ... r
Mayor Ferre: All right now, read the whole thing as amended
now.
Mrs. Dougherty: "The City Manager and the City Attorney are
hereby authorized and instructed to take whatever steps are
necessary to implement said settlement, including the
drafting of appropriate ordinances and resolutions and to
include a request to the Court that a provision in the final
decree be made resolving any pending liens for attorney's
fees before the City pays the attorney's fees where a
pending lien is involved.
Mr. Plummer: Did you say in there ... I didn't hear you say
the resolving of Item three.
Mrs. Dougherty: That was already put, in there.
Mr. Plummer: I thought you were reading the whole
resolution.
Mrs. Dougherty: Section one would include: "Settlement of
the Gates case and other pension related litigation as
hereby approved in accordance with the terms and conditions
as set forth in the attached Agreement for Resolution of
Pension Lawsuits, excepting that portion found in Section 3,
Page 6, regarding the money managers."
ld 40 October 319 1984
Mayor Ferre: We are ready to go. Can the Judge then force
us to accept what they have on the money manager operation?
Or is that something we have to do on our own - we the
Commission?
Mr. Plummer: We have not agreed to it.
Mayor Ferret I realize that, but once we agree to it, then
that is it.
Mr. Plummer: Well, if we don't agree to it, and the Judge
rules something else, we go to Court!
Mr. Silver: So that we all understand, there is no final
agreement until every item is resolved and there is only one
item left outstanding - the resolution, and that, is the item
that is missing in the resolution. If that item is not
resolved, there is no agreement.
Mayor Ferre: All right, for the record. Lucia, are you
ready, now? Did you finally finalize reading it?
Mr. Plummer: Ferre moved the motion.
INAUDIBLE BACKGROUND COMMENTS.
Mr. Plummer: Mr. Clerk, where are we?
Mr. Ongie: I assume we are waiting for a motion.
Mr. Plummer: Did you make a motion?
Mayor Ferre: I am ready to go. I am waiting for Lucia.
Mr. Plummer: She is waiting for a motion.
Mr. Ongie: She read it.
Mayor Ferre: She read it?
Mr. Ongie: Yes.
Mayor Ferre: All right, who moves that, motion? I move it.
Mr. Carollo: Second.
Mr. Perez: Motion and seconded. Call the roll.
�4
- i
i
Id 41 October 31, 1964
y�
6W
The following resolution was introduced by Mayor Ferre,
who moved its adoption:
RESOLUTION NO. 84-1213
A RESOLUTION APPROVING SETTLEMENT OF THE
GATES CASE AND OTHER PENSION RELATED
LITIGATION IN ACCORDANCE WITH THE TERMS
AND CONDITIONS AS SET FORTH IN THE
ATTACHED "AGREEMENT FOR RESOLUTION OF
PENSION LAWSUITS" EXCEPTING FOR THAT
PORTION FOUND IN SECTION 3, PAGE 69
REGARDING THE MONEY MANAGERS; FURTHER
AUTHORIZING AND INSTRUCTING THE CITY
MANAGER AND THE CITY ATTORNEY TO TAKE
SUCH STEPS AS MAY BE NECESSARY TO
IMPLEMENT SAID SETTLEMENT; INCLUDING THE
DRAFTING OF THE APPROPRIATE ORDINANCES
AND RESOLUTIONS AND INCLUDING A REQUEST
TO THE COURT THAT A PROVISION IN THE
FINAL DECREE BE MADE WHICH REQUIRES
RESOLUTION OF ANY PENDING LIEN FOR
ATTORNEY'S FEE WHERE A PENDING LIEN IS
INVOLVED.
(Here follows body of resolution,
omitted here and on file in the Office
of the City Clerk.)
Upon being seconded by Commissioner Carollo, the
resolution was passed and adopted by the following vote -
AYES: Commissioner Miller J. Dawkins
Commissioner Joe Carollo
Commissioner J. L. Plummer, Jr.
Vice -Mayor Demetrio Perez, Jr.
Mayor Maurice A. Ferre
NOES: None.
ABSENT: None.
r
3. ALLOCATE 1/12TH FUNDING TO PREVIOUSLY APPROVED 184-185
SPCIAL SERVICE AGENCIES.
Mayor Ferre: How about this problem with revenue sharing?
Mr. Gary: The funding runs out and it was scheduled two
Commission meetings ago and the City Commission decided that
it wanted to hold up this whole process until we had a
chance and go over all the agencies funding. If you decide
you want to continue, it would be appropriate to pass a
motion because the funding runs out today - to extend the
same programs. r
Mayor Ferre: All right, there is a motion.
Mr. Plummer: Wait a minute.
Mayor Ferre: How long is that?
Mr. Plummer: Whoa! Get legal.
Mayor Ferre: Under the powers granted me by the Charter, I
call a Special Commission meeting for the purposes of
ld 42 October 31, 19$4
dealing with Federal Revenue Sharing. All right, Dawkins
moves.
Mr. Plummer: Second.
Mayor Ferre: Plummer seconds, for one month?
INAUDIBLE BACKGROUND COMMENTS.
Mr. Gary: Okay, one month would be appropriate.
Mayor Ferre: For one month? All right, ready? Call the
roll.
The following motion was introduced by Commissioner
Dawkins, who mGved its adoption:
MOTION NO. 84-1214
A MOTION AUTHORIZING AND DIRECTING THE
CITY MANAGER TO ALLOCATE SUFFICIENT
MONIES TO FUND ONE MORE MONTH (1/12TH)
OF FEDERAL REVENUE SHARING FUNDS FY-84-
85 TO PREVIOUSLY APPROVED SOCIAL SERVICE
AGENCIES.
Upon being seconded by Commissioner Plummer, the
motion was passed and adopted by the following vote -
AYES: Commissioner Joe Carollo
Commissioner Miller J. Dawkins
Commissioner J. L. Plummer, Jr.
Vice -Mayor Demetrio Perez, Jr.
Mayor Maurice A. Ferre
NOES: None.
ABSENT: None.
------------------------- ------ --------------------------
R
is 4. DISCUSSION ITEM: RELEASE OF PUBLIC DOCUMENTS
CONCERNING FORMER CHIEF OF POLICE ETC.
------ --- ----------- ----------------------------------------
Mr. Carollo: Mr. Mayor, I need to make some requests. I
have not received as of yet - I don't want to get anybody
upset, or annoyed at me or mad at me or wanting to recall me
anymore, but I think I do have a right, and I think an
obligation to make sure that public records and documents
that I have requested and I think a lot of people are
interested in seeing, get delivered. Mr. Mayor, I sent a
memorandum to Chief Breslow yesterday, requesting the
following public documents: I requested a copy of the
inventory list constructed by Orlando Martinez and Maria
Padrajo of Kenneth Harm's safe on January 26, 1984,- copies
of the tapes taken by Internal Security during the
investigation on the following individuals: r Michael
Cosgrove, Assistant Chief Police; Robert Alba; Assistant
Police Chief; Orlando Martinez, Police Officer; Maria
Padrajo, and Eddie Cox - copies of the transcribed
statements of those tapes, if any administrative charges
were formulated against any of the above individuals, and
what was the outcome, if any? What is their present working
status in the City of Miami. If any of them resigned, if
so, a copy of the resignation letter and exit form, and last
but not least, the names of any other individuals that were
questioned by Internal Security in the above investigation.
I received a memorandum in my office today from the City
Id
43
ip
Manager that states the following: "To assemble and copy
the material that you have requested of the Police
Department, insuring that all requirements of the Public
Records Law are met makes it impossible to supply this
information in the morning of (today) October 31st.
However, we might be able to make it available by either
late Friday or early Monday." Mr. Mayor, what I have asked
is not that long or complicated a request. It is all public
records. I would like an explanation why it. is going to
take so long for myself and the residents of Miami to
receive this information.
Mr. Gary: First, of all, the residents of Miami didn't ask
for it. Commissioner Carollo did.
Mr. Carollo: Well, that is where you are wrong, Mr.
Manager.
Mr. Gary: I would like for ...
Mr. Carollo: If I may, Commissioner Carollo, whether people
like it, or not, represents a majority of the residents of
Miami.
Mr. Gary: I'd like for Mr. Eads, who looked at this.
Mr. Jack Eads: Yes, sir, that memorandum was received in
the Police Department about, 11:40 A.M., I believe, yesterday
morning and we have a standard policy in the City whenever
there is a request for public records, to review the Florida
Statutes that, are required, particularly when Police
Officers are involved, to make sure we do not violate that
statute and following that review, we will make it.
available.
Mr. Carollo: Excuse me, Mr. Eads? You stated ...
Mr. Eads: Okay, we have a policy in the City that, whenever
there is a public record request, that, that request is
reviewed for compliance with the Florida Statute,
particularly as it involves City of Miami Police Officers to
make sure that we are in compliance with that law. Gov
ahead.
Mr. Carollo: It has been approximately 30 hours since Chief
Breslow received the request. Now, just how long does it
take for our Police Department, or should I say the Police
Administration and the City of Miami's Civilian
Administration to decide with the attorneys that we have if
this is public records or not. I don't think there is any
great question if it is or not. This investigation is
closed. Just how long does it take for your attorneys to
decide when we can have this material?
INAUDIBLE BACKGROUND COMMENTS
Mr. Carollo: Mr. Eads.
Mr. Eads: Yes, sir.
Mr. Carollo: You are going to be repeating everything the
Manager tells you. Maybe we could save some time and just
have the Manager tell it himself.
Mr. Gary: No, he is going to talk.
Mr. Eads: Commissioner, the fact that it has been some 30
clock hours but it hasn't been quite that many working
hours. We process public records demands as rapidly as
possible. There is certainly no intention to try to hold
that up or anything of the sort.
Id 44 October 31, 1964
4
Mr. Carollo: The appearance certainly is there, Mr. Eads.
Mr. Eads: It is not intentional on our part to try to
withhold any of that information.
Mr. Carollo: Why is it going to take until late Friday or
sometime Monday to come to that conclusion?
Mr. Eads: I don't, have your request in front of me, sir,
but I believe there were transcript requested and
significant list of items that would require ...
Mr. Carollo: Well, how hard is it to place a City employee
or a couple of City employees to make copies of statements
that, have been made? How hard is it to get a couple of City
employees to make copies of tapes? They are on file.
Mr. Eads: The copying is not the difficult process, but it
is somewhat time consuming, depending on the volume of it,
obviously, but the review process to insure compliance with
the Florida Statutes is what takes the time.
Mr. Carollo: In other words, you are trying to tell me that
the main reason, really the sole reason is not because it
takes so long to make copies of tapes, or paperwork, but
because the attorneys haven't decided yet what to do it
about, it.
Mr. Gary: It is a combination of both of those things.
Obviously the Police Officers have a more stringent bill -of -
rights than normal City employees and what Mr. Eads is
telling you that it takes time to review that as well, in
conjunction with the documents themselves. You just don't
look at the lawyer. You look at the law and the documents
to make sure you do not violate that. Then it is going to
take time to make the copies. We do not want to give the
opportunity of violating the civil rights and the legal
rights of those particular police officers, particularly in
view of the fact they have the propensity to sue.
1W Mr. Carollo: Well, that is exactly one of the things I wants
to get to the bottom of. If the rights and civil rights of
all these people mentioned here, or some of them, or some
others who were not mentioned here, were indeed violated or -
not, but it certainly appears to me, that the message is
being sent to me is that, you are going to try to stall
giving this information out as long as you possibly can and
I will try to do whatever I can as one individual that was
duly elected by the people of Miami to represent them.
Mr. Gary: That is not our intent. We will comply with the
law, as usual.
Mr. Carollo: If I may now, another request that, I made for
public documents - this is my memorandum to the City Manager
of October 22, 1984, where I have asked, and I have under
lined, for the Manager to provide me with copies of public
documents, specifically the complete personnel,, file of
Francisco Perez. All that, I received from the Manager was a
one page list of some minor things related to Mr. Perez. I
never received copies of the personnel file of Mr. Parrish,
which is what I asked for.
Mr. Gary: Rosencrantz told me that he had given that to
you. I will check to see whether he did or not.
Mr. Carollo: Well, I have not received that whatsoever, Mr.
Manager, and I am quite surprised I have not.
Id 45 October 31, 1984
Mr. Gary: It doesn't surprise me.
Mr. Carollo: Last but, not least, I have here a date of
September 24, 19849 this is a memorandum from Carlos Garcia
to Howard Gary, in reference my request of the City
Administration to supply me with all the office supplies,
expenditures, and travel expenditures for each member of the
Commission for this fiscal year and the previous one. "In
this memorandum we have the travel expenses and office
supply expenses for this fiscal year." It, states in the
bottom - "A similar analysis for fiscal year 182-183 is
being prepared and will be ready within two weeks". That.
was September 24th. Much more than two weeks have gone by,
and I still have not received that information.
>� Mr. Gary: Commissioner Carollo, I will get you a copy ...
Mr. Carollo: Information which I am sure you could
understand, Mr. Manager, is needed by me.
k r'
Mr. Gary: Are you finished?
Mr. Carollo: Yes, sir.
Mr. Gary: With regard to the information of the offices
supplies and travel, we submitted copies of that to you and
I am having my staff person to go upstairs and get, another
copy for you.
Mr. Carollo: This information that I received was for this
• fiscal year only. I have that. I stated that and I am
stating that, again. It states in that, memorandum "...that, a
similar anal sis for fiscal y year '82-'83 is being prepared
and will be ready within two weeks. This is dated September
'==
24th. It has been over a month. In fact, it has been five
weeks since I was told that in two weeks I would receive
that information and I still have not received it.
Mr. Gary: Do you have that memo? I have to have the memo
as well as the one I submitted before you, so we can read it,
in its entirety and not take it out, of context. If I
a,x
recall, I informed you at, the time that you asked for somer
F
information going back five years. I told you we would get
it to you as quick as possible, beginning from year to year.
Now, that takes time.
Mr. Gary: Mr. Manager, I am only reading what was stated to
me by your Administration.
Mr. Gary: I need to see the whole memo, Commissioner
Carollo.
Mr. Carollo: The whole memo, Mr. Manager, is here.
Mr. Gary: The memo that I would have liked to have seen and
I am going to have a copy brought down, is the memo before
you got this.
Mr. Carollo: Mr. Manager, for the record, I am only reading
what was told to me September 24th that I would receive this
information within two weeks. It has been five weeks and I
have not received it.
Mr. Gary: From the Finance Director. I will find out from
him what the status is.
Mr. Carollo: I would appreciate it if I can receive copies
of all these public documents as soon as possible.
Mr. Gary: That is no problem at all.
ld 46 October 31, 1984
1p
s
Mr. Carollo: Thank you, sir.
Mayor Ferre: All right, anything else? We have a motion to
adjourn and a second, and we stand adjourned.
ADJOURNMENT
There being no further business to come before the City
Commission, on motion duly made and seconded, the meeting
was adjourned at 5:32 P.M.
MAURICE A. FERRE
Mayor
ATTEST: RALPH G. ONGIE
City Clerk
MATTY HIRAI
Assistant City Clerk
ld 47 October 31, 19$4
19YY OF NM.AMI
4
�rxr'
-a
DOCUMENT
MEETING CATE:
OCTCBER 31 1984
INDEX
COMMISSION RETRIEVAL
DOCLOVIT IDENTIFICATION ACTION AND CODE NO.
APPROVE THE ISSUANCE OF INDUSTRIAL DEVELOPMENT
REVENUE BONDS, AMOUNT NOT TO EXCEED $20,000,000,
FOR THE*CONTRUCTION OF BAYSIDE SPECIALTY CENTER
PARKING GARAGE LOCATED ON CITY -OWNED PROPERTY AD
JACENT TO MIP14.A.RINA, BOUNDED BY BISCAYNE BOULEVA.
ON THE WEST, PORT BOULEVARD ON THE NORTH, BISCAY
BAY ONTHE EAST AND BAYFRONT PARK ON THE SOUTH.
APPROVE SETTLEMENT OF THE GATES CASE F.ND OTHER
PENSION RELATED LITIGATION IN ACCORDANCE WITH
TERMS/CONDITIONS AS SET FORTH IN THE "AGREEMENT
FOR RESOTUTION OF PENSION LAWSUIT". AUTHORIZE
CITY MANAGER/CITY ATTORNEY TO TAKE SUCH STEPS TO
IMPLEMENT SAID SETTLEMENT; ETC.
84-1212
84-1213