Loading...
HomeMy WebLinkAboutSubmittal LetterProperty Management, Inc. June 20, 2006 Mr. David Chiverton, Chair Model City Revitalization District Trust 4800 N.W. 12th Avenue Miami, Florida 33127 Dear Mr. Chiverton: SUBMITTED INTO THE PUBLIC RECORD FOR ITEM Dsikf ON 6-012-04. Pursuant to our assignment as consultant for the Model City Revitalization District Trust Board, we are submitting to you our report that is designed to raise some of the issues, which I believe certain policies and procedures should be developed to address. While our assignment has been one of detached analysis, we have been a fairly good student of watching this process both formally and informally. There are no major findings apart from what we have all heard. But we are pleased to have reached the conclusion that the goals and mission of the Model City Revitalization District Trust are viable and that the organization, with the right leadership can achieve success. Sincerely, Bryan K. Finnie, Managing Director Platinum Property Management, Inc. BKF:ca 1175 N.E. 125th Street Suite 103 North Miami, Florida 33161 (305) 981-0888 Fax: (305) 891-0003 Licensed Real Estate Broker 06- CI d 7c 'Dise.uSsED 1 CONSULTANT'S COMMENT As you know Platinum Property Management, Inc. was appointed by The Model City Revitalization Trust District Board of Directors (MCT) Board to evaluate certain activities of the MCT's operations. Our charge has been divided into three categories, evaluation of the MCT's programmatic functions, evaluation of its operating structure and participating in the process of identifying an individual to function as the next President and CEO of the MCT. As we prepare our final comments on this assignment, we think it is appropriate to that we thank all those who have assisted us in this endeavor. Representatives from the City of Miami, the District #5 Commission Team, the MCT Board of Directors as well as staff of the MCT. We thank you all for your support ! Over the last several years, the MCT has invested in activities linked to its goals and objectives. These activities range from community evaluation studies, youth summer programs, to housing development. While the MCT's success has been mixed, there is strong evidence that significant efforts were expended in an attempt to implement its agenda. The Interlocal Agreement between the City of Miami, specifically Section 3.2 Pledge of Cooperation highlighted nine (9) areas of opportunities. These are as follows: a. Public improvement projects. b. Construction and/or rehabilitation of residential structures. Submitted Into the public c. Revitalization of commercial corridors. recrd d. Facilitate the construction of a Magnet School. in connection ith C. e. Seek to create open/green space in the Model City area. ittemem Ds-. 4. f. Facilitate the construction of a Postal Facility. Priscilla A. ThompsonCity. Clerk g. Assist in the coordination of a full service Health Care Facility. h. Preservation of historical properties. i. Other opportunities as agreed upon by the City and the MCT. This broad range of activity, if attempted from a direct developmental standpoint, would be overwhelming especially in light of the MCT's staff configuration. However, these activities could be stimulated by the MCT but from the perspective of a match maker. A match maker is defined as a public sector "in but not of government entity" that establishes relationships with public and private sector entities to under take assigned tasks. The original legislation to create the MCT, intended to establish such an entity that would utilize private sector development strategies to stimulate area revitalization was a unique and appropriate idea 5 years ago. That uniqueness and appropriateness of this idea remain in place today. Despite what is widely rumored as a new discovered frontier for development, Model City lags behind other areas of the City of Miami in capital investments. Therefore, the need for the MCT remains viable. Nevertheless, the MCT must modify its operations to increase its efficiency and upgrade its overall compliance functions to be consistent with the City of Miami's rules and regulations. As mentioned previously, I am optimistic that the MCT's operating functions can be modified to improve its ability to achieve its goals and objectives. In terms of the MCT's 2 operations, its current facility is inadequate for its operations. This is a matter that needs to be addressed in the long term; The MCT's Operating Committee process must be expanded from the stand point of a number of new committees; the Agenda Review process must be established to foster greater communication with all those involved; and the MCT must identify and secure a permanent President/CEO. Submitted Into the public record in connection with item`bs- Ll Priscilla A. Thompson City Cleric 3 Model City Trust Consultant's Report June 19, 2006 A. OVERVIEW Submitted Into the public record in connection with item ps"-ti on 4 ,)ol. Priscilla A. Thompson City Clerk An honest evaluation of an organization starts with a detailed look at management. The MCT was structured with the President/CEO managing the tasks of five (5) programmatic staff members. The job titles include Acquisition Development Coordinator, Property Manager, Community Liaison and Executive Secretary and one part-time position. This operating format is consistent with an organization whose implementation mission is to promote residential and commercial development as an active participant. Additionally, the table of organization (see below) structure pre -supposes direct involvement with the City of Miami's Department of Community Development. In terms of the MCT's staff there is limited evidence to prove that assigned tasks were consistent with job descriptions. It appears that assignments were provided on an adhoc basis and to a certain extent, the organization functioned on a crisis management mode over the last 24 months. While this points to inefficient management, it is understandable due to the instability of the President/CEO's position over the review period. B. ORGANIZATIONAL STRUCTURE The current table of organization for the MCT appears to be inadequate for the size and magnitude of its current mission. Although with a new development orientation, it could be modified to function as a facilitator of development. The current table of organization is as follows: Executive Secretary President/CEO Support Staff Part time Acquisition Development Coordinator Property Manager Custodian Community Liaison Again, this table of organization is clearly inadequate for the MCT's operations: This inadequacy is based on the following factors: 4 Model City Trust Consultant's Report June 19, 2006 Submitted Into the public record in connection ith item Priscilla A. Thompson City Clerk 1. The MDC MCT does not have an objective understanding of the size and scope of its current and potential land portfolio. The MCT's mission is to stimulate development in Model City is broad in scope and complicated. Developing successful implementation strategies are difficult but with limited access to land and money, virtually impossible. This aspect of its operations could be dramatically improved if the MCT were to work closely with the City of Miami's Community Development Department. Initial discussions with the City have left the Consultant optimistic that this could in deed occur. 2. The MCT pursuant to community support has championed the production of affordable housing for existing Model City residents. While this is of merit, the MCT has never decided upon what role it should play. Is the MCT a developer? Or, is the MCT a funding resource and land conveyer for development? This factor alone is significant because the identification of your line of business is the basis by which staff is recruited. This factor can be addressed by the Board opting to be a facilitator of development on MCT's area properties. While the MCT has not clearly defined its role, it is apparent that attempts to become a community developer were pursued. However, the MCT's business functions were not adequately structured for this task. Therefore, a more realistic approach by the MCT would entail functioning as a facilitator of development by becoming a liaison between the City of Miami and the private development community. 3. The MCT's operating facility is not adequate for its operations. Limited meeting rooms, a location that is disconnected from the areas main access arteries. More importantly, it is virtually impossible to conduct private meetings with staff or visitors. This fact alone severely limits the President/CEO's ability to effectively manage the organization. It is recommended that the MCT move to an area with greater access to public transportation and identify a more efficient work space. C. OPERATING COMMITTEE(S) Currently, the Model City MCT has three (3) functioning Operating Committees. These are as follows: 1. Housing Committee 2. Executive Search Committee 3. Economic Development Committee While the majority of these committees are active, their effectiveness have been limited due to a lack of direction from the Executive Office of the MCT. This fact is understandable in light of corporate distractions which have occurred over the last 12 months. Nevertheless if the Operating Committee process is to remain viable a clear 5 Model City Trust Consultant's Report June 19, 2006 Submitted Into the public record in connecton ith item Ds. y on Priscilla A. Thompson City Clerk policy direction as approved by the Board and implemented under guidelines established by the President/CEO must be adhered to. While these committees currently, and in the past, have worked to support and provide guidance to staff as it implements the MCT's revitalization plans, the writer suggests that additional committees be established. Committees such as an Executive Committee, Finance Committee, Agenda Review Committee, and Personnel Committee would be of great value to the MCT's operations. It is also suggested that these committees have pre - approved meeting schedules, and perhaps have one or two community advisory seats on selected committees. Nevertheless, an expanded operating committee is recommended. Moving forward it is recommended that an Agenda Review Process be established to process all MCT Board Agendas and Resolutions. By establishing such a process, the opportunity for substantive discussions to occur between Board members and staff prior to an official hearing would be of benefit to the operations of the MCT. I propose that the following process be considered: D. AGENDA PROCESS 1. STAFF'S DRAFT AGENDA ITEM APPROVED BY THE PRESIDENT/CEO 2. AGENDA ITEM(S) SUBMII"1'ED TO THE EXECUTIVE COMMITTEE AND/OR APPROPRIATE OPERATING COMMI 1"1'EE(S). 3. APPROVED AGENDA ITEM TO BE DISCUSSED WITH THE COMMUNITY ADVOCATE AND STAFF LIASON FROM COMMISSION DISTRICT #5 OFFICE. 4. AGENDA ITEM THEN SUBMITTED TO THE MCT BOARD FOR APPROVAL. 5. APPROVED MCT ITEM(S) FORWARDED WITH RECOMMENDATION TO THE CITY COMMISSION OF MIAMI. This process enables the prescreening of all MCT approvals and allows for detailed horizontal and vertical discussions to occur on an institutional and community -wide basis. Generally, this process will allow the MCT to effectively communicate and, if you will, 'get everyone on the same page'. E. AUDIT The City of Miami's Audit General's Office has commenced its audit of the MCT's programmatic functions. Please be advised that this is a limited scope inquiry designed to determine if the MCT has handled its operational and programmatic functions in a manner consistent with the City of Miami's contract procedures. This activity is not a fiscal audit. However, the outcome of the Audit General's Office exercise, which is a report, may be significant. Therefore it is important that the Board establish an Audit 6 Submitted Into the public record in conne,cti©n ith Model City Trust item �'�11_ �� Consultant's Report _ p L June 19, 2006 Pr cill A.. f hob pson C{y Clerk Committee which will be charged with reviewing this report as well as other audit/financial reports and prepare comment and interpret for the overall Board of Directors on an ongoing basis. F. RECRUITMENT OF THE NEXT PRESIDENT/CEO OF THE MODEL CITY MCT, INC. In March 2006, an Executive Search was convened to identify an individual to be retained as the President/CEO of the Model City MCT. In conjunction with the Chairperson of the Recruitment Committee, twenty-eight (28) resumes were reviewed. After careful discussion, it was decided that while the range of candidates were generally of good quality, no one candidate of merit could be identified. Therefore, I recommended to the Board that another search process be commissioned. I suggest that the process be expanded to include both posting, and direct solicitation strategies to identify candidates for the President/CEO position. I am pleased to note that the Board accepted my recommendation and another search process was commissioned. The Recruitment Committee consisting of Ms. Vangates, Mr. Dunbar, Mr. Hall with support from the Consultant, identified a slate of three outstanding candidates. Throughout the process the Recruitment Committee was very consistent on identifying a candidate that could manage a dynamic organization and one that had a strong entrepreneurial background. Mrs. Elaine Black has met that definition. Her business experience from Philadelphia to Miami was impressive. Her knowledge of entrepreneurial activities in Model City is outstanding. I am pleased that the MCT Board of Directors have authorized the Recruitment Committee to offer Ms. Black the position as President/CEO of the MCT. G. City of Miami - Administration Through the Offices of Commissioner Michelle Spence -Jones meetings was convened with the City of Miami's Department of Community Development. The purpose of these meetings were to set up a frame work for a host of future meetings whereby the MCT could work closely with the City of Miami Community Development Department as it facilitated revitalization in the MCT's target area. H. Programmatic Review of Housing Contractual Agreements There is no question that the Model City MCT has spent a significant portion of its time attempting to stimulate development while supporting local disadvantaged businesses. The MCT has aggressively contracted with a number of companies to build residential units or homes. While the results have been mixed, the current pipeline of contracted projects appear to be proceeding. However, the means and methods utilized to contract 7 Model City Trust Consultant's Report June 19, 2006 Submitted Into the public record in connection with item s cry c��› "�-- Priscilla a•City FClerk with these companies should be reviewed and modified. Of significance is how the MCT contracts with contractors who conduct rehabilitation or construction activities on behalf of the MCT. Below, please review the highlights of our activities over the last 12 months: The MCT has entered into a number of A1A contracts which present great risk to the organization. A sampling of those risks is as follows: 1. One contract has a project commencement date as the same date whereby the drawings and specifications are to be submitted for review. 2. All late payments carry an 18% fee payable by the MCT. 3. Overhead profit, generally at 25% is quite high. 4. Certain disbursement documents include no mention of release of liens. 5. Draw downs are scheduled and not subject to Architectural approval. 6. Some documents entail that the MCT absorbed the cost of insurance. 7. Certain documents note that the MCT can not be released from any liability attached to the agreements. Most importantly there is no consistent universal development contract and, if the organization is to remain viable, a universal development and construction services contract must be designed and reviewed by the MCT's real estate attorney prior to any signatures being offered. As of the drafting of this document, the MCT staff has ceased its involvement as a developer hiring subcontractors to build units. It is the recommendation of the Consultant that the MCT no longer function as a direct developer but instead function as a facilitator of development. I. List of On -Going Activities and Development Initiatives McBayne Construction McBayne Construction was contracted to build two (2) single family houses (1291 N.W. 55th Terrace and 1418 N.W. 60th Street) in addition to a commissioned rehabilitation of another single family house located at 1420 N.W. 57th Street. To date none of these units have been completed. This comment is disturbing especially if one takes into consideration that these projects all commenced in FY 2005 and benefited from an aggregate Model City MCT investment of $269,000. The status of these projects are as follows: 1420 N.W. 57th Street Commenced - 5/2005 Disbursements — 5/2005 - $49,000 9/2005 - $74,000 Single Family Rehabilitation — 3 bedrooms, 2 baths 8 Model City Trust Consultant's Report June 19, 2006 Percentage of Completion — approx. 100% Current Status — No certificate of occupancy Outstanding Issues — Partial open permits Submitted ILio the public record in connection ,action pith �y item 'DS-4 on y bto Priscilla A. Th mp on City Clerk 1291 N. W. 55th Terrace Commenced — 9/2005 Disbursement — 9/2005 Single Family New Construction — 3 bedrooms, 2 baths Percentage of Completion — 60% Current Status — Under construction Mobilization — 9/2005 - $36,089 Outstanding Issues — Intends to lien property and looking for additional funding from the MCT 1418 N. W. 60`h Street Commenced —10/2005 Disbursements — Yes Single Family New Construction — 3 bedrooms, 2 baths Percentage of Completion — 60% Current Status — Under construction Mobilization - $108,555 Outstanding Issues — Intends to lien property and looking for additional funding from the MCT Foster Construction Foster Construction was contracted to build one unit on behalf of the MCT. This unit is located at 1301 N.W. 58th Terrace. The financing of this unit was similar to the investment strategy of McBayne Construction. The unit was built at a previously agreed price of $338,000, this includes land costs and upon completion to be sold for $179,000. 1301 N. W. 58th Terrace Commenced — 9/2005 Disbursement — Yes Single Family, New Construction Current Status — Completed Mobilization — Yes Outstanding Issues — Foster Construction has completed this assignment. However, the company has entered into an arrangement to build two (2) other units located at 5856 N.W. 13th Avenue and 5852 N.W. 13th Avenue. The average size of these units is 2200 sq. ft. According to staff, the Community has consistently voiced its support of such sizing of units in the Model City neighborhoods. While I support this notion, I recommend that there is a discussion about size versus. costs. 9 Model City Trust Consultant's Report June 19, 2006 EDFM Corporation EDFM has been contracted to build two (2) single family homes located at 1436 and 1446 N.W. 61st Street. Each unit will contain 1345 sq. ft. 1436 IV.W. 61g Street Commenced — 2005 Disbursement - $20,000 Single Family Construction — 3 bedrooms, 2 baths Percentage of Completion — approx 30% Current Status — Outstanding Issues — Still within the permitting process 1446 N.W. 61' Street Commenced — 2005 Disbursement - $20,000 Single Family Construction — 3 bedrooms, 2 baths Percentage of Completion — approx 85% Current Status — Outstanding Issues — Still within the permitting process ADANAC 1632 N. W. 59th Street Disbursement - $150,000 Single Family Construction - 3 bedrooms, 2 baths Rehabilitation Percentage of Completion — 100% Current Status — Under construction Outstanding Issues — Certificate of Occupancy 1390 IV.W. 58`h Terrace Disbursement - $140,000 Single Family Construction — Rehabilitation Percentage of Completion — 100% Current Status — Done Outstanding Issues — None Dean Construction 1337 N. W. 60t Street — Done 1371 IV.W. 60`h Street — Done 1365 N.W. 60`h Street— Done Commenced — 2005 Disbursement - $159,000 each Submitted inr the public record in connection with item bc Lk on (r I 01, Priscilla A. Thompson City Clerk 10 Model City Trust Consultant's Report June 19, 2006 Single Family Construction — 4 bedrooms, 2 baths Percentage Complete — 100% Current Status — Complete x 3 Outstanding Issues — Staff recommends finalizing punch list. J. Master Permit Residential Building Plans To supplement the above highlighted activities, the MCT has been working diligently to develop Master Permitted Residential Building Plans. This was an effort to stream the building process and develop properties in a manner consistent with community's input. While the Consultant recognizes the importance of community involvement, it is recommended that this activity be disbanded. Moving forward, the MCT should rely on the development community to identify the size and shape of the various structures to be built upon MCT target area land. However, it still remains appropriate for the MCT to establish minimum standards for the size and shape of buildings in its community. K. Brownfield Initiative The MCT is currently working on three (3) Brownfield Initiatives. Essentially these initiatives entail the identification and clean up processes on commercial properties within the MCT target area. The properties targeted to date are 1199 N.W. 62nd Street, 1501 N.W. 62nd Street and 6200 N.W. 17 Avenue. All of these projects are joint ventured with the State of Florida and are ongoing. To date the MCT has received $400,000 in EPA funding for these projects. Submitted Into the public record in connection ith item on 411' ot, Priscilla A. Thompson City Clerk 11 AIA• Document A1051" - 1993 Standard Form of Agreement Between Owner and Contractor for a Small Project where the Basis of Payment is a STIPULATED S This AGREEMENT is made: (Date) BETWEEN the Owner: and the Contractor for the following Project: The Architect is: The Owner and Contractor agree as follows. Submitted Into the public record in connection with item DS a on ce4.ss 0 (- Priscilla A. The r pp:son City Clerk TIONS: his document tion completion. also have An Additions and Deletio Report that notes information revis to the standard le from ld be re This documen legal consequences. Consultation with an atelfney encourag BLSCTRONIC COPYING of any portion of this AIAe Document to another electronic file is prohibited and constitutes a violation of copyright laws as set forth in the footer of this document. AIA Document A10T - 1993. Copyright 0 1993 by The American Institute of Architects. All rights reserved. WARNING: This AIA' Document is protected by U.S. Copyright Law and International Treaties. Unauthorized reproduction or distribution of this AIA° Document, or any portion of it, may result in severe civil and criminal penalties, and will be prosecuted to the maximum extant possible under the law. This draft was produced by AIR software at 09:53:18 on 03/14/2006 under Order No.1000169071 1 which expires on 3/15/2006, and is not for resale. n... enr... 1757075f.6771 ARTICLE 1 THE CONTRACT DOCUMENTS The Contractor shall complete the Work described in the Contract Documents for the project. The Contract Documents consist of: .1 this Agreement signed by the Owner and Contractor, .2 AIA Document A205, General Conditions of the Contract for Construction of a Small Project, current edition; .3 the Drawings and Specifications prepared by the Architect, dated g , and a un erated as follows: Drawings: Number Title Date Specifications: Section Title . 4 addenda prepared by the Architect as follows: Number Date . 5 written change orders or orders for minor changes in the Work issued after Agreement; and .6 other documents, if any, identified as follows: ARTICLE 2 DATE OF COMMENCEMENT AND SUBSTANTIAL COMPLETION DATE The date of commencement shall be the date of this A ent unless otherwise indicated below. The Con shall substantially complete the Work not later than ,,: ,, .:,.. .;'" , subject to adjustment by Change Or, (Insert the date or number of calendar days after the date of commencement) ARTICLE 3 CONTRACT SUM § 3.1 Subject to additions and deductions by Change Order, the Contract Sum is: § 3.2 For purposes of payment, the Contract Sum includes the following values related to Portion of Work Value $ 0.00 § 3.3 The Contract Sum shall include all items and services necessary for the proper ex Work. ARTICLE 4 PAYMENT § 4.1 Based on Contractor's Applications for Payment certified by the Architect, the Owner shall pa as follows: (Here insert payment procedures and provisions for retainage, if any.) § 4.2 Pa eats due and un • 'd under the Contract Documents shall bear interest from the rate of gi (. , or in the absence thereof, at the legal rate prevailing at the (Usury laws and requirements under the Federal Truth in Lending Aci; similar state and I and other regulations at the Owner's and Contractor's principal places of business, the loc elsewhere may affect the validity of this provision.) rk: 'or(of the entisdueatthe of the Project. AIA Document A10A. - 1993. Copyright O 1993 by The American Institute of Architects. A11 rights reserved. WARNING: This MA* Document is protected by U.S. Copyright Law and International Treaties. Unauthorized reproduction or distribution of this AIR' Docent, or any portion of it, may result in severe cavil and criminal penalties, and will be prosecuted to the maximum extent possible under the law. This draft was produced by AIR software at 09:53:18 on 03/14/2006 under Order No.1000169071_1 which expires on 3/15/2006, and is not for resale. Unser Nntmar ,f.10,44e11, record n ccnn ,ct on with item 'Ds• N on c, o e Priscilla A. Th. mpson City Clerk 2 ARTICLE 5 INSURANCE § 5.1 The Contractor shall provide Contractor's Liability and other Insurance as follows: (Insert specific insurance required by the Owner) T i, = of insurance Limit of liabir $ 0.00 § 5.2 The Owner shall provide Owner's Liability and Owner's Property Insurance as follow (Insert specific insurance furnished by the Owner.) T . = of insurance Limit of liabir $ 0.00 § 5.3 The Contractor shall obtain an endorsement to its general liability insurance policy to coer the Contractor's obligations under Section 3.12 of AIA Document A205, General Conditions of the Con Construction of Small Projects. § 5.4 Certificates of insurance shall be provided by each party showing their respective covers prior to commencement of the Work. ARTICLE 6 OTHER TERMS AND CONDITIONS (Insert any other terms or conditions below.) This Agreement entered into as of the day and year first written above. (If required by law, insert cancellation period disclosures or other warning statements above th OWNER (Signature) (Printed name and title) CONTRACTOR (Signature) (Printed name and title) LICENSE NO.: JURISDICTION: Submitted into the public' record in connection with item `DS.A on -> b!. Priscilla A. Thompson City Clerk Ala Document A109. — 1993. Copyright • 1993 by The American Institute of Architects. All rights reserved. WARNING: This ALa' Document is protected by U.S. Copyright Law and International Treaties. Unauthorized reproduction Or distribution of this AIA' Document, or any portion of it, may result in severe civil and criminal penalties; and will be prosecuted to the maximum extant possible under the law. This draft was produced by AIA software at 09:53:19 on 03/14/2006 under Order No.1000169071_1 which expires on 3/15/2006, and is not for resale. User Notes: 12539756437)