HomeMy WebLinkAboutSubmittal- Peter Ehrlichctl z91 it{
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Good afternoon. Peter Ehrlich at 720 NE 69th Street in
Bayside and I work in Lemon City.
Please do not pass the Miami WorldCenter items today.
Defer them so you and the City attorneys, City auditors
and the Planning staff can review the allegations
brought up in todays Daily Business Review's cover
story by Eleazar Melendez. The DBR cover story has
been online since Friday, September 26th.
In addition, you should defer the Miami WorldCenter
items because the proposed Development Agreement
needs improvement.
Section 8 of the Development Agreement states that if
you vote Yes today the developer, or the future
developers, will claim entitlement to install signs,
billboards and illegal LED billboards. Signs could be
unlimited in size and height.
Section 8. Signs.
(a) The Project may require a Master Sign Package or a Special Sign Package
(collectively, "Sign Package") to accomplish the following goals: (i)
moving pedestrians and vehicle traffic throughout the MWC District
safely and efficiently and (ii) properly identifying the MWC District, the
Project and various tenants, events, and components within the Project,
including, but not limited to, residents, guests, visitors, and motorists
along surrounding thoroughfares.
(b) The Sign Package will include, but is not limited to, the following sign
types: (i) directional signs; (ii) ground signs; (iii) wall signs; (iv)
monument signs; (v) way -finding signs; (vi) tower signs; and (vii) on -site
commercial signs, defined as Class C Signs in the Code and Miami 21,
some or all of which may incorporate LCD, LED, or similar electronic
technology consistent with the Development Standards.
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(c) The Sign Package shall apply to signage visible from public rights -of -way
but the Sign Package shall not apply to or include signs internal to the
Project.
(d) Signs of any type or size may be approved as provided for in the
Development Standards.
(e) All signs within the MWC District shall be subject to the requirements of
applicable federal, state, or local rules, orders, regulations, laws, statutes,
or ordinances.
See pages 7 and 8 of Development Agreement
The language is overly favorable to the outdoor
advertising industry. Property owners in nearby condo
towers would be aghast. Tourists would be disgusted.
Please defer the Miami WorldCenter items so that you
and City executives can fix the problems.
Thank you.
C 2)
Submitted into the public
record for item s) 9Clerk
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Fwd: Daily Business Review online Cover Story Sept 29? Page 1 of 5
From: Peter Ehrlich <petersobe@aol.com>
Subject: Fwd: Daily Business Review online Cover Story Sept 29?
Date: Sun, Sep 28, 2014 11:32 pm
Please review...
Peter
From: Peter Ehrlich <petersobe( aol.com>
To:
Seat Bun, ep 28, 2014 7:55 pm
Subject: Daily Business Review online Cover Story Sept 29?
If Miami City Commission Approves,
Worldcenter Developer's Benefit Could
be Millions
Eleazar David Melendez, Daily Business Review
September 26, 2014
Before approving a $199,000 grant to a redevelopment trust serving Miami's
impoverished Liberty City, city commissioners grilled the nonprofit's chief
executive, going as far as questioning whether she was using public funds to pay
her cell phone bill.
Pointedly asking whether her organization would be a good steward of the money,
city lawmakers delved Tuesday into the nitty-gritty of the organization's finances,
prodding the Liberty City Community Revitalization Trust executive about why
greater effort hadn't been placed on getting matching grants from third parties.
A development agreement for the sprawling Miami Worldcenter Associates
project will be on Monday's commission agenda, but that same zeal to scrutinize
whether the city is getting the most bang for its buck appears to be lacking.
While a section of the agreement exempts the developer from paying fees to build
over public rights of way, there is no financial analysis enumerating how much
that could cost in terms of lost fees, the Daily Business Review has found.
The language in question would exempt the developer from Section 55-14(c) of
the city code, which mandates anyone building on public or publicly accessible
rights of ways must pay a one-time fee. Submitted into the public
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Fwd: Daily Business Review online Cover Story Sept 29? Page 2 of 5
In April, the city agreed to vacate three roads in the 27-acre mixed -use
Worldcenter development to create a contiguous site bounded by Northwest First
and Northeast Second avenues and Sixth to 11th streets.
The developer agreed to give easements for pedestrian and vehicle access in
exchange for the vacated roads. A user fee would normally apply to construction
over those easements.
"I didn't do the financial analysis myself," said City Commissioner Marc Sarnoff, a
project booster whose district includes the project site. "I don't know that there's a
financial analysis done, other than I was told by city staff the impact is minuscule."
Assistant City Manager Alice Bravo, who reviewed the development agreement
and applicable city code, said she didn't know if any analysis had been done on
the potential value to the developer of waived user fees but would check.
Subsequent requests for comment were not returned.
The city previously charged developers millions of dollar for the right to build over
and under public rights of way. For example, the developers of the Brickell City
Centre have paid the city several million dollars in fees for the use of public rights
of way. At least $1.3 million was directly linked to air rights over Southeast Sixth
Street.
It's impossible to know the exact value of Worldcenter's waived payments for air
rights, partly because plans have not been finalized. The first phase in an area
including the demolished Miami Arena would include a 765,000-square-foot mall,
convention center hotel and at least four towers with more than 1,000 condo units.
The developer told the DBR the first phase of construction does not include any
encroachments. Still, several experts maintain the dollars being waived by the city
could be significant.
"We can't know exactly how much those rights are worth because there are no
other bidders and no open market for them," said Leonardo Clavel, a Miami real
estate executive who does consulting work for developers, including national
homebuilder K. Hovnanian Homes. "However, it's clear they are worth a lot more
than what the city is asking for them, which as of now is zero."
He added, "The impact of over -street air rights on a project this size is easy to
underestimate."
Clavel explained the right to build over thoroughfares gives developers a lot of
flexibility and allows them to create large continuous structures, which can be a
profitable proposition.
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Fwd: Daily Business Review online Cover Story Sept 29? Page 3 of 5
A Miami real estate attorney who does business with the city and asked not to be
identified said the waiver is valuable to the developer because it allows
construction in areas that would otherwise be off limits.
Air Rights
Allowing Worldcenter the potential to build over roadways, sidewalks, emergency
vehicle access lanes and other public thoroughfares is a departure from a city
policy codified in 2009. At the time, city commissioners explicitly said they
intended future builders to pay the city for the use of air space otherwise
unavailable for construction.
"We have an opportunity here to raise money for our city because these
individuals are basically using our air rights," then -City Commissioner Joe
Sanchez said before voting for the measure, meeting minutes show. He went on
to compare air rights that developers buy privately to build taller buildings to the
air rights over public transportation easements. "You had developers that bought
their neighbor's air rights, and they paid good dollars for it, so why not capitalize
on this situation to generate money for the city?"
An economic consultant who worked to shape that measure told the DBR that at
the time he was hired to consult on the issue, it was clear the city intended to use
the sale of air rights over public rights of way as a source of revenue.
"At the time that we did that, I don't think that the city was getting anything when
they gave up the rights, and they didn't think that was fair," said Andrew Dolkart,
president of Miami Economic Associates Inc. "We thought that if they wanted
rights on the easement, they needed to pay for it somehow. If the city has decided
not to do that, then you have to ask them why."
Asked precisely that question, City Commission chairman Willy Gort told the DBR,
"That's a very good question."
"When it's the government giving up a benefit, of course that's very important," he
said. "I'm sure in the second reading that would be brought up." The second
reading is Monday.
City Commissioner Francis Suarez said he needed to seek guidance from the city
on the issue before making a comment.
City Commissioner Frank Carollo did not return a request for comment by
deadline.
Fee Exemption
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Fwd: Daily Business Review online Cover Story Sept 29? Page 4 of 5
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At least part of the reason why commissioners might not have fully explored the
air rights issue is comments from the city's planning director, Francisco Garcia, at
the Sept. 11 meeting where commissioners initially approved the Worldcenter
deal. Several citizens criticized the user fee exemption.
Political blogger Al Crespo told lawmakers, "You're gonna give this project an
untold amount of money by giving away air rights for free."
In a rebuttal to Crespo and others, Garcia said those who stood up to talk about
the issue were mistaken. Expanding on his comments, he went on to address the
issue of air rights in terms of development capacity —the right to build higher
within the building footprint. Garcia never addressed the issue of air rights over
public rights of way.
"I misunderstood the issue of air rights as increasing the height they would be
able to have," Garcia later told the DBR.
Asked if he would change his comments, Garcia argued city fees for the right to
build over thoroughfares did not apply to the Worldcenter project since the city
previously vacated the streets and gave them to the developer for a nominal fee.
When it was noted the project was providing the city with easements for both
vehicular and pedestrian traffic, to which the user fees would apply, Garcia said
those actions by the developer were "voluntary."
But the code language clearly applies to publicly maintained roadways as well as
a "public easement or emergency access easement area" on private land.
"Even on the proprietary side, by including this in the development agreement, it
means that the City Commission is giving the developer the right to build over an
area neither they nor anyone else could before," an attorney consulted by the
DBR said on condition of anonymity.
Remove Impediments
Nitin Motwani, managing principal of the Worldcenter development company, said
his project would bring over $2 billion in private investment to a blighted segment
north of downtown, revitalize the area and create jobs.
"The development agreement between our team and the city creates a framework
for delivering the master -planned project we envision, while providing certainty to
the city that we will deliver improved sidewalks and streetscapes for a more
pedestrian -friendly experience, world -class retail and new public spaces,"
Motwani said.
Sarnoff, who has been a strong Worldcenter booster, said the provisions of any
development agreement are generally calibrated by the developer to make sure
the project is profitable, and it would be foolish to cavalierly toss them aside.
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•Fwd: Daily Business Review online Cover Story Sept 29? Page 5 of 5
"No one does anything in America without a return on investment," Sarnoff said.
"Any impediment you put in their way is something that's going to be something
that affects them. Philosophically, you want to take out as many impediments as
you can. You want to jeopardize this over user fees? It doesn't make sense."
The fee doesn't mean city officials haven't been busy negotiating with the
developer to get a better agreement for the city.
Gort said a draft agreement required the developer's "best efforts" to hire at least
20 percent of all employees from within the city. It has been changed to 25
percent.
City Commissioner Keon Hardemon similarly said he was negotiating with the
developer on that provision.
Sarnoff said a section of the deal that would allow 25 liquor licenses in the project
footprint with little oversight is being modified.
"There needs to be some process put in place where there's at least equitable
distribution of these permits," he said. "I'm not sure unfettered discretion is
something that folks want to see."
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