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HomeMy WebLinkAboutCC 2009-06-18 MinutesCity of Miami City Hall 3500 Pan American Drive Miami, FL 33133 www.miamigov.com Meeting Minutes Thursday, June 18, 2009 8:30 AM SPECIAL City Hall Commission Chambers City Commission Manuel A. Diaz, Mayor Joe Sanchez, Chair Michelle Spence -Jones, Vice -Chair Angel Gonzalez, Commissioner District One Marc David Sarnoff, Commissioner District Two Tomas Regalado, Commissioner District Four Pedro G. Hernandez, City Manager Julie 0 Bru, City Attorney Priscilla A. Thompson, City Clerk City Commission Meeting Minutes June 18, 2009 8:30 A.M. INVOCATION AND PLEDGE OF ALLEGIANCE ORDER OF THE DAY Present: Commissioner Gonzalez, Commissioner Sarnoff, Chair Sanchez, Commissioner Regalado and Vice Chair Spence -Jones On the 18th day of June 2009, the City Commission of the City ofMiami, Florida, met at its regular meeting place in City Hall, 3500 Pan American Drive, Miami, Florida, in special session. The meeting was called to order by Chair Sanchez at 9: 21 a.m., recessed at 9:22 a.m., reconvened at 11:19 a.m., and adjourned at 12: 07 p.m. Note for the Record: Commissioner Sarnoff entered the Commission chambers at 9: 22 a.m. and Vice Chair Spence -Jones was not present before the meeting recessed. Note for the Record: Commissioner Gonzalez entered the Commission chambers at 11: 20 a.m. ALSO PRESENT: Julie O. Bru, City Attorney Pedro G. Hernandez, City Manager Priscilla A. Thompson, City Clerk Pamela Burns, Assistant City Clerk Chair Sanchez: Good morning, ladies and gentlemen. Want to take this opportunity to welcome you to the June 18, 209 [sic] special City Commission meeting, here at the City ofMiami Commission in these historic chambers. The members of the Commission that are present -- we have Commissioner Gonzalez; we have Commissioner Regalado, myself as the Chair. As soon as the other Commissioners enter the chamber, we will announce their names. Also present, we have the City Manager, Pete Hernandez; we have the City Attorney, Julie O. Bru; and we have the City Clerk, Priscilla A. Thompson here with us. This special meeting that's being called to order of the City ofMiami Commission has been called to consider only the items that have been advertised, specifically, certain amendments to the baseball stadium agreement by and among Miami -Dade County, the City ofMiami, and Marlins Stadium development -- Developer, LLC (Limited Liability Company); including, but not limited to the -- an extension of the termination for convenience date. This item that has been called to order -- at this time, I will be recessing the meeting to allow representatives from the County to be here to answer any questions this legislative body may have pertaining to the finances. So at this time, this meeting stands in recess. City ofMiami Page 2 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 RESOLUTION Minutes are transcribed verbatim. Periodically, agenda items are revisited during a meeting. "[Later...]" refers to discussions that were interrupted and later continued. SP.1 09-00668 RESOLUTION City Manager's A RESOLUTION OF THE MIAMI CITY COMMISSION, WITH Office ATTACHMENT(S), RELATED TO THE BASEBALL STADIUM, APPROVING THE TERMS OF, AND AUTHORIZING THE CITY MANAGER TO EXECUTE, A FIRST AMENDMENT TO CONSTRUCTION ADMINISTRATION AGREEMENT BY AND AMONG MIAMI-DADE COUNTY ("COUNTY"), CITY OF MIAMI ("CITY") AND MARLINS STADIUM DEVELOPER, LLC, (THE "CAA') IN SUBSTANTIALLY THE FORM ATTACHED AS ATTACHMENT 1 TO, AMONG OTHER THINGS, (I) EXTEND THE OUTSIDE DATE FOR TERMINATION FOR CONVENIENCE BY ALL PARTIES TO THE EARLIER OF: EXECUTION BY COUNTY OF BOND PURCHASE AGREEMENTS OR JULY 15, 2009, (II) PROVIDE THAT IF THE COUNTY HAS NOT CLOSED THE COUNTY BONDS BY JULY 17, 2009, THE COUNTY SHALL HAVE THE RIGHT TO TERMINATE THE CAA FOR CONVENIENCE, (III) EXTEND THE DATE THE CITY IS REQUIRED TO DEPOSIT THE CITY'S FUNDS TO JULY 17, 2009 , (IV) AMEND THE FORCE MAJEURE PROVISION TO IDENTIFY CERTAIN SPECIFIC EVENTS THAT WILL EXTEND THE PARTIES' FUNDING OBLIGATIONS UNDER THE CAA BY THE LENGTH OF THE DELAY CAUSED BY THE EVENTS, AND (V) AMEND THE WARRANTY DEED FOR THE BASEBALL STADIUM SITE, WHICH IS EXHIBIT "E" TO THE CAA, TO INCLUDE AN AUTOMATIC REVERTER IN THE EVENT THE CAA IS TERMINATED FOR CONVENIENCE AND INCLUDE THE LEGAL DESCRIPTION BASED ON THE RE -PLAT OF THE PROPERTY. 09-00668-Legislation. pdf 09-00668-Exhibit-SUB. pdf 09-00668-Memo. pdf Motion by Commissioner Gonzalez, seconded by Vice Chair Spence -Jones, that this matter be ADOPTED WITH MODIFICATIONS PASSED by the following vote. Votes: Ayes: 3 - Commissioner Gonzalez, Sanchez and Spence -Jones Noes: 2 - Commissioner Sarnoff and Regalado R-09-0304 Chair Sanchez: All right, ladies and gentlemen, the baseball special meeting this morning was called to order and it was recessed. We're bringing it back to order. It has been properly advertised. What's in front of this Commission, as we wait for Commissioner Gonzalez to come out, is an amendment to the Construction Administration Agreement. I am asking that this special meeting that was properly advertised limit to the amendments to the Construction Administration Agreement only. We should limit ourselves to only the items that are in this resolution. So having said that, we're going to go ahead and wait for Commissioner Gonzalez. Could somebody go get Commissioner Gonzalez? Okay, why don't we go ahead and -- Mr. City Manager, let's go ahead and start. Somebody can -- can somebody go get Commissioner Gonzalez, please. There needs to be five Commissioners here to vote on this item. He's coming? All right. All right, Mr. City Manager, you're recognized for the record. City of Miami Page 3 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 Pedro G. Hernandez (City Manager): Mr. -- Chair Sanchez: We also have representation from the County here in case anyone should have any questions pertaining to the finance or any questions pertaining -- Mr. Hernandez: Right. Chair Sanchez: -- to the item that's in front of us today. All right, Mr. City Manager, you're recognized for the record. Mr. Hernandez: Mr. Chair, Commissioners, last Friday our City Attorney andl met with the County's attorney and other attorneys, and it was brought to our attention that there would be a need to, in essence, extend the termination for convenience date from July 1 to July 15. I think that we ended up now doing it to July 17. The present language in the contract calls for the termination for convenience to end either on July 1 or whenever the bond purchase agreement is executed. The County originally was planning to issue bonds this last Wednesday and today, which would have placed the bond purchase agreement execution on Friday, so there was a need for a special City Commission meeting in order to be able to extend the date. This was needed because the County needed to do some technical changes to their bond ordinance. The County is hearing this bond ordinance on a first reading tomorrow and will be having their second reading on June 30. And in essence, the County needed more time also to be able to have their closing in the early part of July so they selected the date, I believe, of June -- of July 17, before which they need to have the closing of this financial package for the stadium. There has been -- there's an item that we'll be discussing here today that our City Attorney will be getting into more details that, in essence, provides more protection to the City and the County. So, definitely the item that we have is, I would say, positive and protective to the interest of the City. The item provides that when the bond purchase agreement is executed, that the City will be in; meaning, we don't have the right to terminate for convenience. That's the same language that we have today, but it does provide that the County will have until July 17 to exercise that termination for convenience. The item today also provides for a reverter in the case that we convey to the County the Orange Bowl site and the County exercises termination for convenience, we have a reverter that that land comes back to the City, so that's further protection. So the item, itself, I think is very sound and protective to the City. There have been some concerns as to what are the technical issues related to the County financing, and since the counties [sic] are a partner in this deal, we have called on the County -- andl know their director of finance, Carter Hammer, is here and also Charles Parkinson, who's very familiar with the agreement, and also Jose Gallant (phonetic). I think that it would be best now if we have our City Attorney address you on the -- I think on the details of the item that we have before you, but the County's here to be able to provide testimony on the financial issues. Chair Sanchez: All right. I think the first question needs to be answered is why do we need to amend this? Maybe the County could address that. Mr. Hernandez: Okay. Charles Parkinson. Charles Parkinson: Good morning, Mr. Chairman, honorable Commissioners. My name is Charles Parkinson. I'm with Miami -Dade County and I'm assigned to work on this ballpark project. With me today is Carter Hammer, our finance director. The reason why we need to amend the CAA (Construction Administration Agreement) is purely technical. It's a timing issue for the County. Our letter of credit provider, Wachovia Bank, requires certain terms that we cannot meet under our current bond ordinance for the professional sports tax/tourist development tax. It has to do with the order in which they receive their fees, which were already factored into the financing of this project. So I think it's important to state right off the bat this is not about additional money. This is about Wachovia Bank receiving their fees for providing a letter of credit on the variable rate portion of the debt on parity with the principal and interest City of Miami Page 4 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 payments and all three of these items -- their fees, the principal, and the interest -- were factored into the County's calculations, if you will, for debt service weeks ago, so nothing has changed there. But because we have to go back to our board with an ordinance for first reading tomorrow and an ordinance for second reading on the 30th -- and by virtue of the fact that County ordinances are not effective, irrespective of a mayoral veto, which isn't an issue here, but irrespective, our ordinances are not effective for another 10 days, which would be July 10 -- we necessarily have to move the date of the termination for convenience, and that is the reason. Chair Sanchez: All right. So just -- the statement that you made that these technical changes will have no impact on the project's funding? Mr. Parkinson: That is correct. Chair Sanchez: All right. Would it have an impact in the budget in itself? Mr. Parkinson: No, sir, none whatsoever. Chair Sanchez: Okay. And would it affect the date for the project to be completed? Mr. Parkinson: I see no reason why it should. Chair Sanchez: Okay. Mr. Parkinson: Andl assume we're referring to April 30, 2012? Chair Sanchez: Yes. Mr. Parkinson: Yes, sir, that is correct. Chair Sanchez: All right. Commissioner Sarnoff. Mr. Chair. Chair Sanchez: Yes, sir. Commissioner Sarnoff. Mr. Parkinson, forgive me; I don't recall a letter of credit being discussed as part of this deal when I first voted on this issue. When did a letter of credit become apparent -- and by the way, I've confirmed that with the City Manager; I've confirmed that with the City Attorney; they were not aware of a letter of credit. Mr. Parkinson: To answer your question, I would like to defer to our finance director. Carter Hammer: Good morning, Commissioners. Chair Sanchez: Good morning. Mr. Hammer: Carter Hammer, Finance director for Miami -Dade County. We have always considered using variable rate debt on the new money for the PST (Professional Sports Tax)/TDT (Tourist Development Tax) financing of approximately $240 million. We've considered in the financing a combination of both variable rate debt, current interest bonds, and capital appreciation bonds. Variable rate debt in today's market requires a liquidity provider in the way of a letter of credit. We actually did an RFP (Request for Proposals) with a number of banks for that letter of credit. We had a provider, which is Wachovia, come back with variable -- very favorable terms on that letter of credit. Just so everybody is aware, the fees on that letter of credit are not paid upfront; they're paid quarterly in arrears, and it's a two-year letter of credit. City of Miami Page 5 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 So at the time we actually close that letter of credit, we don't have to pay the fees until approximately one quarter later for the first quarter of those fees. But the variable rate debt has always been a part of the equation for the PST/TDT financing. It was just a matter of working out the financing structure and then seeking the letter of credit provided through an RFP. Chair Sanchez: Is that common? Mr. Hammer: That's very common. Chair Sanchez: Is that a common factor? Okay. Mr. Hammer: I think, if you look at the market today and in the past, variable rate debt has, for the most part, always been supported by a letter of credit. Commissioner Sarnoff. How does the letter of credit, which acts differently than a bond, obviously, correct? Mr. Hammer: Yes, it does. Commissioner Sarnoff. And would you describe how that difference occurs? Mr. Hammer: Well, the variable rate debt has a call provision, and under that call provision, the buyer of that bond can ask for redemption through the remarketing agent; and the remarketing agent, if they cannot then remarket those bonds, they need to go back to the letter of credit provider; so underneath the letter of credit, there are some provisions that address that issue, but that's why variable rate debt requires a letter of credit. Commissioner Sarnoff. And what supports the letter of credit? What is the obligation that the taxing authority is putting up? Mr. Hammer: Well, these -- the financing is being supported by the professional sports tax. Commissioner Sarnoff. Only? Mr. Hammer: Well, part of the reason for the change in the ordinance is because County code does not allow the TDT, tourist development tax, to pay for administrative fees. The professional sports tax ordinance, as we're speaking about today, has administrative fees last. The -- Wachovia wants to have those administrative fees on parity with principal interest and the reserve payments, so we're making the change to the ordinance at our meeting tomorrow, the Commission meeting tomorrow. Commissioner Sarnoff. But don't think you answered my question. Is the pledge solely the PSFT (Professional Sports Franchise Tax)/TDT for the line of credit, or does it also include the general obligations of the --? Mr. Hammer: No. The pledge for the letter of credit is the professional sports tax. Commissioner Sarnoff. Okay. And the PSFT is being utilized to pay off old 1998 bonds, correct? Mr. Hammer: A portion of that is, yes. A portion of that -- it's approximately $240 million of new money, plus approximately $98 million of refunding. Commissioner Sarnoff. So the PSFT and the TDT would then be used to pay off such things as what we did -- what you guys did -- I guess I should say the County did with regard to Crandon City of Miami Page 6 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 Park, the tennis facility -- Mr. Hammer: That's correct. Commissioner Sarnoff. -- and a number of other issues? How do those fit into the PSFT, though, since they're not professional sports franchises? I mean -- Mr. Hammer: Well -- Commissioner Sarnoff. -- how are you able to do that? Mr. Hammer: I'm not sure I understand. Those are simply refundings that are being supported - Commissioner Sarnoff. I understand. Mr. Hammer: -- and were previously supported by professional sports tax. Commissioner Sarnoff. Right. But if you read the ordinance itself, it actually lists -- I believe it lists Major League Baseball, it lists the NBA (National Baseball Association), it lists the NFL (National Football League). It actually lists -- well, I'll read it to you right here, Florida Statute 2883(b). It says, "Franchise to be affiliated for the purpose of being a professional sports franchise is defined as the national league or the American league of Major League Baseball, the National Basketball Association, the National Football League, or the National Hockey League." My question to you is how can you pay back with PSFT funding issues that have nothing to do with professional sports? Mr. Hammer: Well, I can't address -- those are some legal matters, which I am not a lawyer, andl can't address that question. Commissioner Sarnoff. Okay. So you have no idea if you could comply with Florida statutes on that or not? Mr. Hammer: I believe -- I certainly believe it does, but we would have to have our attorneys address that. Commissioner Sarnoff. Okay. Chair Sanchez: Any other questions? Commissioner Sarnoff. Of that issue, no. Chair Sanchez: Okay. All right, any questions from the Commissioners? Vice Chair Spence -Jones: I was waiting for Madam City Attorney -- Chair Sanchez: Yes. Vice Chair Spence -Jones: -- to -- I'm assuming -- is there anything that you're going to add on this? Julie O. Bru (City Attorney): Actually, I think the Manager just did an excellent job of summarizing what's before you. We did have a revision to the attachment from what was printed, and basically, the revision is just some language that we have provided that modes the force majeure provision to specifically allow for any party to suspend performance of a material City of Miami Page 7 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 obligation in the event that there is a court order entered that prohibits or prevents the parties from fulling a material obligation, so the funding of -- certain specific fundings of the parties would then be delayed by the period of time of the force majeure. That's really the only change that --from -- that you have from the printed agenda. Other than that, the Manager summarized these technical amendments. Chair Sanchez: Just -- I have some questions for our attorney. Madam Attorney, I think your -- we call the shots here. We call the shots as to the City. The County's going to call their shots, and the Marlins are going to call their shots. I think -- the one thing that I think that we need to get very clear here is that this only affects the obligation to fund, correct? Ms. Bru: The definition change -- I mean, the changes to the force majeure clause really only have to do with the parties' obligation to fund correct. Chair Sanchez: All right. And the other concern -- which you look at this, I think the only two concerns is, one, if this goes to court or the process that it's going through now, or for whatever reason the County cannot bond out, for whatever reason -- and I'm not saying, you know, that -- the probabilities of the injunctions are very minimal, but let's say it does happen -- puts us in a situation where, one, the County may be ceased from moving forward, but we would still be moving forward as to Section 6.3, which clearly states that we will deposit the 13.5 of the proceeds into a City account, and that -- the City shall make a deposit by July 17. The concern here is that if, for whatever reason, the County is stopped in any way from moving forward, is there language here to your satisfaction that protects the City? Ms. Bru: Now there would be under this amendment. Chair Sanchez: Okay. Commissioner Regalado: Mr. Chairman. Chair Sanchez: Hold on, hold on. Because we are putting in the 13.5 -- as a mat -- as we speak here, we've already put money into this. Every party has put -- the County has put money into it and we have put money into it as to the -- we haven't put the 13.5, but we will be obligated to put the 13.5 into that account. We have spent money in infrastructure improvements around the baseball stadium, so we have been moving forward in this process, so there's money already invested in this process. So the concern, once again, what it boils down to is that the assurance that we have that if, for whatever reason, this is by a court order seized in the County side that we would not be able to move forward until all that is resolved and then we could -- all of us move forward to get this stadium built. Based on the language of the amendment that you have proffered, you are satisfied that it protects the City from that? Ms. Bru: Yes, Mr. Chairman. Chair Sanchez: Okay. All right, any other questions? Commissioner Regalado. Commissioner Regalado: Madam City Attorney, yesterday I saw in the Miami Herald the advertisement of this special meeting. Are you satisfied with only 24-hour notice? Ms. Bru: Yes. Commissioner, this is a special meeting. Under our Code and under the sunshine law, the notice that is required to be given is reasonable notice, and we did advertise it in three different publications, and it is reasonable under the circumstances. Commissioner Regalado: But 24 hours for you is okay, under the state law, but what about the documents that were not made available for the residents or anybody to see? What is the reasonable notice of the backup document? City of Miami Page 8 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 Ms. Bru: Well, the -- as far as the documents are, since this is a special meeting, there really isn't any rules of procedure that you have adopted that governs how far in advance the documents have to be distributed. And under the sunshine, as long as there's been reasonable notice of this meeting, there isn't really any strict requirement as to when the item has to be available in written form. Commissioner Regalado: Okay. The other question I have is -- I have been listening to the Manager and to you celebrating the amendments on the contract, and your words and the Manager's words were that this [sic] amendments will now protect the City. So my question is why those amendments were not placed on the original contract? I mean, the City had a liability with the force majeure in case that anybody sue. The City had a liability with the reverter clause because the way that it was portrayed, the County would have given, if they wanted, the site to the City or not. So now that we are celebrating this -- and by the way, had not the County asked for an extension, this agreement would not had been drafted, so the City will still been in harm's way. So my question is why nobody thought about this in the original agreement? Mr. Hernandez: Commissioner, I don't think it's a question of thinking about it. I think that's the result of lengthy negotiations and give and take on both sides, and that's how the agreement was crafted. Here, I believe that we're taking advantage, I would say, of an opening to be able to tighten up some of the concerns that we have based on what we know today, andl think the attorneys have taken this opportunity to put in the language to provide further protections based on the fact that if the County now wants to extend their date to July 17 and we convey to them because work needs to be done at the site, if they happen to terminate, that land goes back to us, so we're ensuring further protections based on what the County wants to do. So it's -- I think we're taking the opportunity, seizing it, and tightening controls based on what the County asked for. Commissioner Regalado: Well, it doesn't explain why we didn't do it before, but -- And the other issue is what happen if we don't allow the extension? Ms. Bru: The County needs to have this additional amount of time because that's -- as was explained, they have to amend their bond ordinance. Commissioner Regalado: No, but one thing is what they need; another thing is what we do. Ms. Bru: I think we would be hurting ourselves because then we would be locked in to a termination date. Our ability to terminate would be earlier than what would be appropriate or adequate to protect ourselves; so really, this is in the City's best interest to extend these dates. Commissioner Regalado: So you're saying that our ability to terminate, if it's earlier, is a difficulty for us? Ms. Bru: Well, I think it presents a difficulty for all parties because the agreement -- Commissioner Regalado: Well, for all parties -- Ms. Bru: Yes. Commissioner Regalado: -- yes, it does, but not for the City because then we have the leverage of deciding if we want to or we don't. Ms. Bru: But, Commissioner, the majority of this Commission has already spoken -- Commissioner Regalado: I understand. City of Miami Page 9 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 Ms. Bru: -- and they -- Commissioner Regalado: I'm asking -- Ms. Bru: Right. Commissioner Regalado: -- hypothetical. Ms. Bru: Yeah. Well, it is something that is required in order to be able to allow this project to move forward within the time frame that is now envisioned. Commissioner Regalado: Yeah, but who requires that? The County does. Ms. Bru: It has been at the request of the County to accommodate -- Commissioner Regalado: Right. Ms. Bru: -- their scheduling needs. Commissioner Regalado: So this is purely a County problem, might say, or mistake that they made? Chair Sanchez: It's -- Commissioner Regalado: Thank you. Ms. Bru: Yes. Chair Sanchez: All right. Commissioner Sarnoff. Mr. Chair? Chair Sanchez: Yes, sir. Commissioner Sarnoff. You know, each time we vote on baseball, we have a little more information, you have a better understanding of our environment, andl suspect many people up here voted here predicated on the fact this was never going to affect anyone's general fund; that this was going to come from what we categorically call professional sports franchise tax, tourist development tax, and convention development tax, and maybe it's somewhat wise because we all know, as we speed down the highway of life and as we're about to hit budgets, there's a wall in front of us. Maybe we were 300 miles away from that wall a couple of months ago, and this budget cycle, we all know that we're about 30 feet from that wall, and that wall's coming right at us. There's going to be some very hard decisions, and the decisions that we're going to make are going to play out for the next 40 years. None of us will be sitting here when any of these taxes demonstrate an inadequate way to fund either the bonds or the line of credit, and l just want to point out to this Commission what very reputable agencies have to say about the ability to bond this. From FIFC (Florida Intergovernmental Finance Commission): FIFC called our tourism mature rather than fast-growing. It's historically volatile due to socioeconomic and weather events. Moody's, the gradual ascending debt service schedule is based on a somewhat optimistic estimated growth and pledged tourist development tax revenues. It sites current and past falls in tourist income as indicative of the vulnerability and narrow pledge of this revenue source. Here's what Standard and Poor's has to say -- and I'll suggest to you that Standard and Poor's is probably the gold standard -- the back -loaded debt service schedules requires tourist development tax revenue growth to continue at a strong compounded rate -- pace of 3 to 5 City of Miami Page 10 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 percent beginning in 2011, without interruption, for 40 years, which we believe -- this is Standard and Poor's -- is unlikely. And let's face it; if we know right now, if they go forward with the funding plan as stated, 37 percent of the payments in the final year will not come from tourist development taxes. They simply cannot because they don't have the adequate amount. They also highlight the fact that the deal balloons. We all know what a balloon is. We should learn what balloons are because balloon mortgages are what put this country in the shape that it's in right now as a result of people merely paying interest -only loans. While tourist development taxes should barely pay the first year's 10 million, they say payments ballooned. We might add, as did the mortgages that triggered the housing collapse. Only 12.1 percent -- listen to this -- of the bonds will be repaid in the first 10 years. So by the 40th year -- and I'll suggest to you that some of you will have grandchildren up here -- we'll still be paying off the stadium bonds, and the annual cost balloons to $74.6 million, which is nearly a quarter of the $321.5 million being raised in five series of stadium bonds. It is described by Moody's -- and that's somebody I would say to you is the most optimistic of the rating agency -- is a heavily back -loaded debt structure. Simply by restructuring the debt which they may not have the right to do because they're using PSFT dollars to pay for something that is not baseball, that is not the NBA, that is not the NFL, simply by doing the restructuring deal, it will cost taxpayers 22.9 million more dollars, 22 -- but amongst friends, that's not much, and that will stretch out over nine years to 2009. That simply interest upon interest. Think about this. You have exhausted -- this Commission will be a part of the exhausting of convention development tourist tax, the tourist development tax. You're going to be faced with a decision in the very short future, I suspect by one group that's going to be seeking help for a museum, and what are you going to be able to say to that museum? You're not going to be able to fund them with the City ofMiami's general fund. You're not going to be able to fund them with tourist development tax dollars. You're not going to be able to fund them convention development tourist tax dollars because you have utilized your capacity for all of these funding sources. You've placed all of your proverbial eggs in one basket. And Commissioner Gonzalez, you said something very profound. I'll give you the most two profound statements I've ever heard on this Commission. The first was '7 matter today," and that comes when we do budget, and you're right; you do matter that day, and the rest of the days you may not matter. I mean that respectfully. The second most profound thing you ever said was "What about a convention center?" The City ofMiami simply doesn't have a convention center. We'll never have a convention center if you use all of your CDT (Convention Development Tax) money available to you for a stadium, and you'll have a shortfall to pay for that stadium. Each one of us are going to face a very hard obligation, and that's going to be not allowing people to come into the general fund; yet, you know, as you sit here right now, without the general fund of the County, you will not be able to bond any of these bonds. They would not accept a mere pledge of PSFT, TDT, or CDT dollars because they know themselves it's inadequate. It's very easy up here to have legacy projects. Not one of us will be here when our grandchildren find out that in the same budget that police, fire, sanitation, and roads come out of there's going to be a competition for a Marlin's payment. Ah, but you say, "Don't worry; we can refinance that again." Ask yourself this question: October 11, 2008, what happened to this great country? A lot of people did interest -only financing. A lot of people said let's just extend this payment forever, and an entire system crashed. We don't learn from our mistakes. We simply only do things as we've been trained and we are heading down a road that is so apparent, that is so obvious that we are passing this debt onto our children without regard, without concern; and just as important as the future, what are you going to do for the museums? What are you going to do when they have inadequate funding source? What are you going to do when they ask to be put onto your general fund 'cause you can't afford them? There's a crisis looming in the City ofMiami, and that's our budget, and we all know it, but it's difficult to deal with. So I ask everybody to take a sobering moment and ask yourself is this really a good steward of the population's money? Are we really being good stewards up here? Are we setting a correct priority? Are we actually representing the constituency that we've been elected to do to fund a baseball stadium to the expense of imperiling the general fund? I suspect, if we all took a hard look at this, we'd say no. The baseball deal simply doesn't work as structured. That doesn't mean that baseball doesn't belong in Miami, and it doesn't mean we should do everything City ofMiami Page 11 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 we could do to attract them, but this baseball deal does not make sense. This baseball deal is financed on the back of your grandchildren. Chair Sanchez: All right. Vice Chair. Vice Chair Spence -Jones: First of all, I want to -- where's Larry? And maybe Mr. Manager can also answer this because the comment that Commissioner -- one of the comments that he's made, I just want to be clear on. Are we creating an issue, to your knowledge, regarding our general fund? Is this going to be creating an issue for the City ofMiami, because we keep bringing up general fund, general fund? Mr. Hernandez: It does not create an issue to the City ofMiami. I said it before and I'll say it again, to the City ofMiami, this is a great deal, period. Larry, if you want to add anything to that. Larry Spring: Larry Spring, chief financial officer. You know, we've -- again, we vetted this plan with regards to our -- the City's obligations and we feel comfortable. I thought the Commissioner was focusing on the larger bonding deal of the County. Commissioner Sarnoff. The County. Mr. Spring: So not specifically -- Vice Chair Spence -Jones: So it's really -- Mr. Spring: The City of Miami's portion. Vice Chair Spence -Jones: Okay. And the City ofMiami portion, you don't see an issue -- Mr. Spring: Not at this time, no, I do not. Vice Chair Spence -Jones: -- that it will be affecting our general fund? Mr. Spring: No. We've made that pledge. We've been clear about it. Vice Chair Spence -Jones: And how much are we investing again? I want to be very clear. Mr. Spring: The City's investment is basically 125 million. Vice Chair Spence -Jones: Okay. Mr. Spring: Hundred for the garage -- Commissioner Sarnoff. One thirty-one. Mr. Spring: -- 94 -- Chair Sanchez: Garage is paid by the Marlins -- Mr. Spring: Yes. Chair Sanchez: -- five million dollars, so you got to -- Mr. Spring: Right. City ofMiami Page 12 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 Chair Sanchez: That's a wash. Mr. Spring: Right. Thirteen point five for contribution to the stadium itself and then another twelve million for infrastructure, public infrastructure. Vice Chair Spence -Jones: Okay. I just wanted to just be clear because a lot of times we throw stuff out on the dais an we throw it out in the universe to the people that are watching it and it just creates even more confusion around a simple issue, so I just wanted to have clarity -- Mr. Spring: Again, if I'm mistaken -- Vice Chair Spence -Jones: -- from you regarding the issue, and you have officially -- my Manager and my finance person for the City or CFO (Chief Financial Officer) has officially put it on the record that they do not see this becoming an issue for our general fund Mr. Spring: For the City's general fund Vice Chair Spence -Jones: Is that correct? Mr. Spring: Correct. Mr. Hernandez: Correct. Vice Chair Spence -Jones: Okay. Because that's what you guys get paid to do, okay. So let me just move on real fast. I do not want to get caught up in the whole issue of polifics. I'm going to focus my energies on putting the people over the politics. For me, you know, this is something that we've already voted on, we've already approved. Yes, we're coming back to make some changes on it, butfrom -- as a representative of District 5, my focus has always been, especially regarding the Marlins, has been jobs, the training portion of it, and of course, the small businesses that will be affected by this one way or the other. So the -- basically, the train is already moving. My concern has always been making sure that we live up to our commitments regarding the overall project, so at this point, I just want to be very clear from D5's perspective - - District 5's perspective -- there are a lot of people that are depending on jobs from this. There're a lot of small businesses that are depending on this as a result of their working on the overall project, and not only that, the training that's going to come out of it with our apprenticeship -type program, so there is a lot that's depending on us making the right decision to move the project ahead. So I just want to be clear on that overall issue. Now, I don't have to have a very long discussion about this item because we've already voted on it and approved on it in the past, and we already know that even -- four of us, at least, have voted on this project just the last time it came up in front of us, so if we had an issue with it, we shouldn't have voted -- all four of us shouldn't have voted for it in the beginning anyway, so I don't know why this now has become an issue. I guess the politics has come into play on it. But I do want to make sure at least the key issues that I've discussed with my Manager has been addressed and our City Attorney to make sure that the commitment that was made by the Marlins and by the County stays on task, andl want to be very clear. I do not want to continue to be the babysitter of the Marlins' project. Quite frankly, I have a million and one other things to be doing in my district than to be asking the same questions over and over again to make sure that the commitment stays in place, so this is really directed towards the County and, of course, towards our administration and, of course, the Marlins, but I want to make sure that this goes into the record, once again, so that we stay on the right track. The one thing that's -- there's five things that I want to make sure are included or remain included as a part of this process before I take my vote. The first thing for me was to monitor that we talked about the last time we voted on this overall issue. While I understand the County has a monitor on their side of this issue, that's great, butt know they report to the County. I want to make sure, Mr. Manager, the monitor that we put in place, for all of those -- you know, the commitments regarding the jobs, the training, City of Miami Page 13 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 the small businesses, everything that everybody promised to do stays intact, so that's the reason why I requested that a monitor be placed on the City's side that can come and bring this City board or this Commission updates as to whether or not we're living up to our commitments. Okay, it's -- 90 days have gone by already and I'm still asking the same question. So Mr. Manager, I want to make sure that monitor is put in place. Mr. Hernandez: Commissioner, it will be. I'm pursuing, as a matter of fact, looking at various individuals that are -- have the capability and the skill and the experience to do that work for the City to be -- to provide the oversight for the City itself -- Vice Chair Spence -Jones: Okay. Mr. Hernandez: -- and I'm pursuing that, andl should be able to come back with a name pretty soon. Vice Chair Spence -Jones: And that person should make sure that they are meeting -- I'm saying the Marlins and the County are meeting their goals and objectives, along with the City, to make sure that we -- the promises that we made to the people remain intact. The other part of that we voted on -- andl don't want to ever be in this -- placed in this position again, Mr. Manager -- we asked in regards to any contracts or any agreements or any RFPs that at least we be briefed on what the process is before an RFP is put out. On this last contract that we voted on, which was the A&E (Architect & Engineering) contract, it kind of just appeared, okay, andl don't want to be in that situation again when it comes to garage or anything else that the City has infrastructure. Anything that we have regarding this overall issue, I want to make sure that this doesn't come up as an issue again. The A&E contract, for instance, the person sat up here and made a commitment and said that whoever -- as far as their team was concerned, that it would reflect the whole entire City, making sure that people that were brought on their team would reflect the people that actually live in the City. I want to make sure, Mr. Manager, that is actually happening, andl want to hear from you on the record that that is. Mr. Hernandez: Commissioner, that is actually happening. I spoke to that firm today, and they told me that they were following up on their commitment that they made here on the record. Vice Chair Spence -Jones: Okay. Andl want to be very clear for everybody listening here, at home, and everywhere else, I don't care who it is, it doesn't make no difference to me, I just want to make sure that every part of -- everyone's district has the ability to benefit from the project actually coming. The third thing, which is -- I've been pushing from day one, which was the CRA (Community Redevelopment Agency) -- Overtown CRA, making sure the commitment to the individuals stay intact and that was the finding of necessity study and the redevelopment plan. I do want to thank the Administration for finally getting that done. It is moving through the system. I think that we have one additional stop. IfI can at least get some clarity on that before I take a vote. I don't know if that's Mr. Larry, if you need to at least officially let me know where we are in the County regarding the FON (Finding of Necessity) and the redevelopment plan and when are we looking to go to market on the stuff for the Overtown area. Mr. Spring: Larry Spring, chief financial officer. As you know, this board -- CRA and City Commission already voted on those items. The Southeast Overtown/Park West finding of necessity has already made it through TIF (Tax Increment Fund) Committee, Housing Economic Development Committee, the County, and is scheduled to be on the June 30 Commission meeting for final approval, and the plan was transmitted --I don't know the specific dates, but it will be tracking through to be finalized before their break so we'll be able to go to market in the fall. Yesterday I met with our -- the City's financial advisor, and we will be developing our bonding schedule so that we can track at the same time. If you want, once we have the schedule in place, all the assignments done, I'll forward that -- the schedule -- you know, the work plan schedule to you so you'll see what date we're starting and what date we plan to price, like the County's City of Miami Page 14 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 doing. Vice Chair Spence -Jones: Not a problem. I just want to add, that also includes the Omni area as well. That should be moving -- Mr. Spring: The Omni finding has been done, but we still need to bring the Omni plan back to the City Commission. Vice Chair Spence -Jones: No problem. Mr. Spring: That's being done right now. We had some technical issues. We actually had to buy software to, you know, amend the plan and took a couple of weeks to get it from Adobe, but - Vice Chair Spence -Jones: No problem. Mr. Spring: -- we're moving now. Vice Chair Spence -Jones: Thank you, Larry. Mr. Spring: All right. Vice Chair Spence -Jones: And then my last two items, which are already moving or in motion, Mr. Manager, which is the Miami Works project, the initiative with the unions for the apprenticeship training program. It's extremely important when all these jobs come on board and the project actually starts, we do not want to hear any excuses from the major contractors that they can't find anybody to work on the site and they have to go to Fort Lauderdale, Mexico, California, and everywhere else and they can't find no one in the City ofMiami 'cause they don't have anybody trained and ready to go. The commitment was made that this center would be up and running to coincide with everything that's going to be built as a part of the Marlins Stadium. I want to make sure that process has been -- progress has been made from that perspective. I just want to get a commitment on the record that that is happening with the City Administration. Mr. Hernandez: Commissioner, that is in the works right now. That is moving forward Vice Chair Spence -Jones: Okay. And in closing, I do want to make sure the RFP process that we're preparing for, the garage, that we make sure that whatever the issues are, the concerns that have come up with the million and one hearings and discussions that we've had about the Marlins Stadium regarding the small businesses and the constituents have been included in the overall RFP, and that we all, as Commissioners, are briefed before that RFP actually hits the streets. I think it's extremely important that that happens. Mr. Hernandez: Okay. We'll make sure that happens. Vice Chair Spence -Jones: Okay. Mr. Hernandez: I know that's being worked right now. Before we actually put it out on the street, we'll do the briefing to the Commissioners. Vice Chair Spence -Jones: And that -- with that being said, I am -- I have learned a lot sitting on this dais, and that means to make sure that always put it -- have you guys put it on the record so that there's no confusion in the end. This will be the second time that I'm actually mentioning these items, so I'm hoping that they will move rather quickly. But with that being said, I am ready to take a vote on this situation, and also, I want to be very clear that I am getting a recommendation from my City Manager and my City Attorney on this item; is that correct, City ofMiami Page 15 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 Madam City Attorney? Are you recommending that we approve this item today? Ms. Bru: Yes, ma'am, Vice Chair. Yes. Vice Chair Spence -Jones: And Mr. City Manager, are you recommending to us that we do approve this item today? Mr. Hernandez: Yes. Vice Chair Spence -Jones: That's all need to hear. Chair Sanchez: All right. Commissioner Gonzalez. Commissioner Gonzalez: I'm all right. Chair Sanchez: You're all right. Mr. City Manager, this -- and you sit here and we sit here, and we represent the City ofMiami. We don't represent the County. We don't represent the Marlins. We represent the City ofMiami. This is a very complex case -- agreement that has been worked out for quite some time. If you look at the investment that the City's making, which is just $25 million -- this baseball stadium is being built in the heart of our city; we benefitfrom that. We're going to have a world -class baseball stadium. We're going to be able to keep a baseball franchise in Miami for many, many years. The economic development around the Orange Bowl is going to provide a lot of opportunities, and when I mean opportunities is taxes that they're going to be paid, revenues coming into the city, plenty of jobs that we need to be out there trying to provide and create for our residents not only in the City, but in the County. This is a good deal for the City ofMiami when you look at the investments. This is a very complicated issue. There are going to be amendments. There are going to be tweaks, and we need to work together. You know, I'm here fighting for the City and I'm here fighting for the people that live in the City that are going to benefitfrom this project, which is in the building -- which is in the City, and the County's going to have to deal with their Commission when they vote on their issue. But the museums got money from bond money that they got money from bond -- the taxpayers approved. They're going to have to go out there and raise their money, the other side of the money, the other amount that they need to raise to build their museums, and that's fine. But overall, the baseball stadium is going to be something that's going to be providing opportunities and something good for this City. The investment is there, $25 million. The parking garage is going to be paid back with the money that they're paying us back, and we benefit from it. Now, what could be going -- here is it that we could be building a baseball stadium someplace else in another city and not in the City ofMiami, and they would be using those tourist tax to build that baseball stadium someplace else. So we, as Commissioners, have to look out for the betterment of our city and the people we represent, and this is a good deal for the City ofMiami. So having said that, I think we are prepared to vote, andl will take a motion and a second, as amended. Is there a motion? Commissioner Gonzalez: Move it. Vice Chair Spence -Jones: Second. Chair Sanchez: Second? All right, there's a motion and a second on this resolution that's in front of us. Madam Clerk, roll call. Priscilla A. Thompson (City Clerk): Roll call. Commissioner Regalado? Commissioner Regalado: No. Ms. Thompson: Commissioner Sarnoff? City ofMiami Page 16 Printed on 7/1/2009 City Commission Meeting Minutes June 18, 2009 Commissioner Sarnoff. No. Ms. Thompson: Vice Chair Spence -Jones? Vice Chair Spence -Jones: Yes. Ms. Thompson: Commissioner Gonzalez? Commissioner Gonzalez: Yes. Ms. Thompson: Chair Sanchez? Chair Sanchez: Yes. Ms. Thompson: The ord -- I'm sorry; the resolution has been adopted, as modified 3-2. Chair Sanchez: All right. Need a motion to adjourn the meeting. Commissioner Sarnoff. So moved. Vice Chair Spence -Jones: So moved. Commissioner Gonzalez: Motion to adjourn. Chair Sanchez: Motion and a second always in order. Meeting's been adjourned. Thank you very much. END OF RESOLUTION MOTION TO ADJOURN A motion was made by Commissioner Sarnoff, seconded by Vice Chair Spence -Jones, and was passed unanimously, to adjourn the June 18, 2009 Special Miami City Commission meeting pertaining to the Baseball Stadium. City of Miami Page 17 Printed on 7/1/2009