Google Ads help pay the expense of maintaining this site
Click Here for the Neighborhood Transformation Website
Fair Use Disclaimer
Neighborhood Transformation is a nonprofit,
noncommercial website that, at times, may contain copyrighted material
that have not always been specifically authorized by the copyright
owner. It makes such material available in its efforts to advance the
understanding of poverty and low income distressed neighborhoods in
hopes of helping to find solutions for those problems. It believes that
this constitutes a 'fair use' of any such copyrighted material as
provided for in section 107 of the US Copyright Law. Persons wishing to
use copyrighted material from this site for purposes of their own that
go beyond 'fair use' must first obtain permission from the copyright
10/31/03 Miami Herald
Overtown agency may have wasted millions
By Oscar Corral
The agency charged with redeveloping Miami's Overtown neighborhood apparently misspent
money on limousine rides, rent for never-used office space, a slew of questionable
business deals -- even on a report on bus benches in the Bahamas, a city audit has
The report, released Thursday by the city's Office of Internal Audit, is the latest
blow to the city's troubled Community Redevelopment Agency, already under investigation
by the Miami-Dade state attorney's office and the FBI.
The CRA, created to revitalize one of the city's poorest areas, apparently squandered
hundreds of thousands of dollars on consultants, the report found.
According to the audit:
The agency doled out $1.8 million in 15 separate deals for different goods and
services without bids, requests for proposals and/or written contracts.
Civil CADD, a firm hired by the CRA for consulting, may have double- or even triple-billed
the agency for tens of thousands of dollars by submitting multiple invoices for
the same job.
The CRA paid $720 to a limousine service for a ''back-to-school event'' sponsored
by the agency. CRA Executive Director Frank Rollason said CRA Chairman Arthur Teele
Jr., a city commissioner, and CRA staff were among those riding in the limousines,
waving during a parade in Overtown. Rollason didn't know when the parade took place.
''They told me those limousines were donated,'' Teele said Thursday.
The agency paid a consultant $125,000 to study bus stops and routes in Miami,
without board approval and without a written contract.
The CRA paid $76,800 in federal funds to the law firm of Holland & Knight
for ''lobbying activity.'' Federal law does not allow its funding to be used for
lobbying, the audit states.
The CRA has spent $13,000 to rent a run-down building in Overtown -- the Masonic
Lodge at 941 NW Third Ave. -- that it has never used.
One CRA employee who had to travel to the Bahamas to renew his U.S. work permit
was paid $4,250 to photograph bus benches while he was there. The audit states that
the employee may have also been collecting a paycheck from the agency during at
least part of his trip.
''An employee on CRA payroll who also engaged in a contract with CRA appears to
constitute conflict of interest,'' the audit states. ``Other than a picture of bus
benches and designs of computer animated gazebo drawings, there is no identifiable
tangible benefit resulting from this disbursement.''
CRA board members said the audit confirms their worst fears.
''It provides hard evidence of what I feared for more than two years: mismanagement,
wrongdoing, lawlessness,'' said CRA board member and Miami Commissioner Joe Sanchez,
who has become a leading critic of the agency and its past practices.
``There are so many rules that were violated. The CRA was operating far outside
the bounds of good governance.''
The audit's findings also confirm much of The Herald's own investigative reporting
on the agency over the past year.
In recent articles The Herald has reported that the agency has spent $35 million
over the past 10 years and has little to show for it. Only five of 36 projects planned
by the agency during the last five years have been completed, and four of those
CRA Vice Chairman and Miami Commissioner Johnny Winton took responsibility for some
of the problems at the agency but said that there are many questions that only Teele
could answer. Teele has been the CRA's chairman since 1997.
''I think the audit makes us all look pretty bad,'' Winton said. ``I can't answer
all these questions directly. The chairman has to answer many of these questions
because I don't know.''
In an interview Thursday, Teele said he had not yet reviewed the audit but had been
briefed on it by Auditor General Victor Igwe.
''There is a total impression . . . that I am hands-on, when in fact I am not there
as an executive chairman,'' Teele said. ``I am prepared to sit down with the city
attorney, the executive director, and the manager to ensure that safeguards are
put into place to prevent this from occurring in the future.''
One of the consultants paid by the CRA without board approval was Vernon P. Clarke,
a former employee of the Metro Dade Transit Authority, the audit states. Clarke
was paid $125,000 without a written agreement over the course of about 18 months.
Clarke told The Herald on Thursday that Teele called him, asked him to come to a
meeting, then put together the assignment. Clarke submitted a detailed report to
the CRA on bus stops around the city.
Teele asked me would I do that assignment for him,'' Clarke said. ``In terms of
it not being a written contract and not having board approval, I felt there were
enough bigwigs in the room that it wouldn't be a problem.''
GRANT OR LOAN?
The CRA also gave $42,557 to the now-defunct Club Exile without an executed loan
agreement or a promissory note, the audit states. The audit states that the club's
owners contend that the money was a grant, not a loan. Auditors could not find paperwork
at the agency to back up the club's claim.
The audit also found that the CRA misused money that should have gone to redevelop
the area within its defined boundaries.
About $96,000 was paid by the agency for festivals that were held outside the agency's
boundaries, the audit found.
The audit also confirmed a deal reported in The Herald in which TLMC Enterprises,
a firm with ties to the CRA's former director, won a contract to build parking lots
in Overtown as the low bidder, despite submitting a proposal that left out major
work, CRA records show.
The company later submitted change orders that added tens of thousands of dollars
to the contract, records show. TLMC Enterprises said it did nothing wrong.
It ''gives the appearance of some degree of impropriety,'' the audit said of the
Auditor General Igwe said the audit took almost six months to perform. He said he
found the worst abuses he has seen in his four years at the city.
''Fiscal accountability/integrity are necessary to ensure public trust/confidence
in the process used to disburse public funds,'' Igwe wrote in his final report.
Former CRA Executive Director Annette Lewis could not be reached for comment.
Current Director Rollason said the audit may have blown some problems out of proportion,
but he said he was glad to have the information.
''It's made some mountains out of some molehills for sure,'' Rollason said. ``But
to me it has pointed out the lack of managerial and procedural controls over the
administration of the CRA.''
CRA board member and Miami Commissioner Tomás Regalado said the next question
is who will pay for all of this.
''If an elected official did just one-tenth of what's in that audit, they'd strangle
us on Flagler Street,'' Regalado said. ``The question now is, what are the state
attorney and the U.S. attorney going to do about it?''