Miami Today: Week of Thursday, February 4, 2016 by Miami Today

WEEK OF THURSDAY, FEBRUARY 4, 2016

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Coral Gables to market bonds to upgrade downtown, pg. 14 EXTENDING CAB LIFE: County commissioners unanimously approved legislation Tuesday to extend the retirement date of taxis scheduled to come off the road Dec. 31, 2015, for two added years. For five consecutive years, the commission has spared older cabs from requirements they be taken off the road after eight years, leaving taxis to operate that some officials have said are unsafe and could deter tourists. During prior discussions by the commission and in committee, commissioners supported the ordinance, in some cases because they understand the competition the cab drivers are facing from alternative ride services, while others said the industry must eventually be brought up to current technology. Juan Zapata said he’d vote for longer cab life once assured there won’t be safety issues with those that are two years older than the former ceiling. Transit Department Director Alive Bravo said the cabs will still be inspected quarterly.

Airport’s commercial paper banks on low interest, pg. 16

THE ACHIEVER

BY SUSAN D ANSEYAR

FLYING HIGHER: Miami International Airport added 3 million passengers to reach a new high of 44.3 million last year, final audited figures show, an 8.3% one-year gain. Domestic passengers rose 11% to 23.1 million while international traffic grew 5.5% to 21.2 million. Cargo was flat at 2.17 million tons. HOTELS GET STRONGER: Miami-Dade ranked third in the nation in December in average daily hotel room rate, revenue per available room and hotel occupancy among the top 25 US markets, according to Smith Travel Research. The average daily room rate for the month was $240.77, up 3.6% from the prior December. Revenue per available room was $184.90, up 1.9%, and average daily occupancy was 76.8%, down 1.6% from the prior December. Over the same period the number of hotel rooms in the market grew from 50,020 to 52,787, a 3.5% increase in supply, as more than 32,000 rooms were sold during the month than in the prior December. BIG WHEELS FROM CHINA: A subsidiary of one of China’s top 500 manufacturers, Shantui Construction Machinery Co. Ltd., has leased a 4,950-square-foot retail site at 5201 NW 77th Ave. for three years. Shantui America Corp. leased the site from MCS Investment Group LLC. Shantui, founded in 1980 and one of the world’s top 50 makers of construction equipment, specializes in bulldozers, road and concrete machinery and industrial vehicles. Robert Eckstein of NAI Miami represented Shantui in the deal.

Suzy Batlle

Photo by Marlene Quaroni

Ex-banker hit sweet spot founding Azucar Ice Cream The profile is on Page 4

City talks of creating transportation master plan BY JOHN CHARLES ROBBINS

As Miami wrestles with ways to loosen the knot of traffic gridlock, city commissioners are pondering a comprehensive transportation master plan. With a goal to improve mobility in the growing city, the plan would focus on mass transit and connectivity. It would also examine cut-through traffic’s impact when frustrated motorists leave congested arterial routes like US 1 and race down narrow neighborhood streets. During a Jan. 28 briefing with City Manager Daniel Alfonso, Commissioner Francis Suarez brought up the idea of a transportation master plan. It came up as commissioners talked about the scope of a study required to create a transportation impact fee on developers. The discussion touched on the city’s efforts to expand its free trolley system and the county having overall responsibility for transportation. “One of the things we need to explain to the county is we have a different philosophy of how to move people throughout our city,” Mr. Suarez said. “Our philosophy is

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that our neighbors and neighborhoods have to come first, and that it’s not about a car saving five seconds to get… from point A to point B – that’s what the arterials are for. “I think what a transportation master plan will do is look at that cut-through problem comprehensively throughout the city. It can recommend traffic control devices. It can recommend maybe even closures, which a lot of residents have sought, neighborhood closures,” he said. Commissioner Wifredo “Willy” Gort noted that several cities have trolley systems. “I think with the master plan we see how we can connect with each other,” he said. “The different [trolley] routes can also connect to mass transit. I think that would be very important.” Recently-elected Commissioner Ken Russell raised a question regarding a transportation master plan. “Would it only encompass the responsibilities that we have as a city, the things that we can directly impact, or would it go into what we would hope to lobby the county for or the state for, in terms of the total vision of transportation?” he asked. “I think this is a great opportunity for us

to talk about what we want the scope to be,” Mr. Suarez responded. “The scope should be, for example, not only traffic control devices and intercity congestion and trolleys but it should also be mass transit, it should also be any other form of transportation that you feel is going to benefit the citizens of the City of Miami.” “I think that’s great,” Mr. Russell said. He also said a transportation impact fee would make sense. “The more development that we approve, the worse traffic will get and the more the need is for us to address it with public transportation and you name it,” he said. Commissioner Frank Carollo suggested rapid action on an impact fee. “In the meantime, more buildings are going up,” he said. “It’s causing more of a traffic issue, and I think we need to have a traffic impact [fee] in order to properly remedy, or at least try to remedy, those issues.” Mr. Alfonso said he expects to have a proposal and cost estimate on the study and on what’s needed for a master plan in 60 days.

Miami-Dade commissioners agree that fundraising by candidates should be made public but worry that proposed new reporting rules might find candidates accused of violations they neither intend nor commit. On Tuesday, the commission unanimously deferred Daniella Levine Cava’s proposed ordinance to clarify it in a March workshop. As written, the campaign of every candidate for Miami-Dade county or municipal office would file an electronic listing of every contribution the candidate solicited along with the donor’s name, amount and the relationship between the contributor and candidate. Elected officials who aren’t running would file a monthly report, beginning a year before taking office, on solicitations on behalf of any political committee, listing the same information as candidates do. Those who don’t file on time would be fined. Ms. Levine Cava said the legislation is designed as a “common-sense step” toward providing more information about candidates so voters feel they have a voice, as well as to bring county law into line with statelevel rules. Certainly, Commissioner Juan Zapata said, the spirit behind the ordinance is well intentioned. “We always strive for transparency. The danger in these things is the unintended consequences.” Audrey Edmonson agreed, saying that when she ran she received literature from groups praising her, comments she had not solicited. “That’s an unintended consequence,” she said. “I can see myself being cited for an ethics violation when I had nothing to do with it.” Moreover, Mr. Zapata said, lobbyists could still set up political action committees and have greater influence on elections than people realize because such activity wouldn’t be transparent, which he called contrary to the spirit of the ordinance.

MIAMI’S ECONOMY UNSCATHED AS CHINA’S SLOWS ...

GABLES PARKING AT ISSUE WHEN 2 GARAGES CLOSE ...

CAN COMMUTER RAIL SPROUT WHERE CROPS GROW? ...

MIAMI GETS 10 VANS TO ADD NEW TROLLEY ROUTES ...

VIEWPOINT: LINK UP 28 ISOLATED TRANSIT SYSTEMS ...

189 COMMISSION-ORDERED REPORTS ARE PAST DUE ...

DEVELOPERS INVITED TO CREATE GARAGE PROJECTS ...

OWNER SEEKING TENANTS AT MEGA-YACHT MARINA ...

MIAMI TODAY

TODAY’S NEWS

THE INSIDER BOATS ON DISPLAY: As part of the Miami International Boat Show from Feb. 6-17, the Miami City Commission approved an agreement with NMMA Boat Shows Inc. for use of docks at city-owned Miamarina at Bayside in downtown Miami. The National Marine Manufacturers Association has presented the Strictly Sail portion of the annual boat show at Miamarina since 1999, “providing excellent exposure of the city’s marina to an estimated 100,000 annual attendees from all over the world,” says a staff memo on the deal. This event is expected to generate about $134,517 in revenue to the city. The annual show displays more than 2,300 of the world’s newest power boats, sailboats, engines and accessories. The main venue for this year’s boat show is the land and water around Miami Marine Stadium on Virginia Key. SMALL BUSINESS CONSTRUCTION: Miami-Dade commissioners unanimously approved legislation Tuesday that will allow higher-level contractors to compete in the small business enterprise construction services program for lower-level set-aside contracts if those estimated at a cost of $10 million or less are not available. If passed in committee and ultimately given final commission approval, the following definitions will apply for contracting participation firms: Level I, with three year-average gross revenues of up to $2 million; Level II, with three-year average gross revenues from $2 million but not exceeding $5 million, and Level III, with three-year average gross revenues from $5 million but not exceeding $10 million. All firms could bid on prime contracts with estimated project construction in excess of $10 million. The small business enterprise construction services program is gender and race neutral, set up specifically for firms defined as independent construction companies. PUBLIC OPEN SPACE: To add open space and park land throughout Miami, commissioners on Jan. 28 agreed to buy a corner lot in Flagami that will one day soon be a pocket park. The city agreed to pay $285,000 for the 9,475square-foot parcel at 12th SW 47th Ave. owned by the Federal National Mortgage Association. That amount will cover acquisition and the cost of survey, environmental report, title insurance and related closing costs. Commissioner Francis Suarez said the commission looks to make such mini parks available Francis Suarez to neighborhoods that want them. The pocket parks “enrich our neighborhoods with public space,” he said.

WEEK OF THURSDAY, FEBRUARY 4, 2016

Miami unscathed as China lags BY B LANCA VENEGAS

Miami’s international trade has felt little direct impact following the recent downturn in China’s economy and commodity prices. Manny Mencia, senior vice president of International Trade & Development at Enterprise Florida, told Miami Today that, since the US dollar is strong and Manny Mencia China is “not a major market for Florida,” a slight impact has been mostly felt from an indirect standpoint. “The Chinese slowdown is affecting particularly the major commodity producers and exporters in Latin America,” Mr. Mencia said. “That’s the reason why Florida trade was somewhat slow last year.”

Last year, while US economy expanded 2.4% for a second straight year, China’s expansion pace slowed to its lowest point in a quarter-century, according to Bloomberg reports. Part of this major slowdown was attributed to sluggish exports. The negative impact seen in Florida trade in the past year was attributed to Brazil, Colombia and Venezuela, Mr. Mencia added, because “the culprit” is strictly the commodities. “We are not saying China is not an important market [for Florida],” Mr. Mencia said. “China was about a $1.2 billion export market for Florida last year.” China and Florida trade was down 3% for the year between November 2014 and November 2015, according to Enterprise Florida data. While Florida exports to China were down approximately 17.5%, Florida imports from China

were down 1.5%. However, within the gravity of the downturn, he said, there are some silver linings with nations of the Caribbean and Central America that are commodity importers and whose economies are more directly linked to the US rather than to China or other big importers of commodities. “Mexico, and Peru are holding their own pretty well,” Mr. Mencia said. “Our exports to Mexico are now up about $2.2 billion.” Florida’s exports to Chile seem to be recovering slowly, Mr. Mencia said. Exports to Argentina are also bouncing back. “The Chinese economy is affecting trade adversely and we are not immune from it,” Mr. Mencia said, “but China as a market is not as vital for Florida as it is to other parts of the United States.”

WATSON ISLAND APPROVALS: On a 4-1 vote, Miami commissioners approved a package of ordinances that clears the way for revival of the seaplane base on Watson Island and a heliport too. Frank Carollo cast the lone “no” vote, suggesting a lease of the city-owned property to Chalk’s aviation service be found null and void. The commission approved a city-initiated change of the land use designation of 5.31 acres from Public Parks and Recreation to Major Institutional, Public Facilities, Transportation and Utilities. It also Frank Carollo approved rezoning the property from Civic Space to Civic Institutional. The loss of Civic Space land on Watson Island will be offset by designating part of the Rickenbacker Causeway as Civic Space available for park and recreation uses. STUDYING SLOWPOKES: County commissioners directed the administration Tuesday to study the use of low-speed vehicles on MiamiDade roads. The resolution by Esteban Bovo Jr. states a number of lowPhoto by Marlene Quaroni speed vehicle operators, commonly referred to as “free ride” operators, Former PortMiami director Bill Johnson will lead the mission to Mexico as state secretary of commerce. generally transport people short distances in electronic vehicles and claim to generate their revenues through advertising. State law restricts operation of low-speed vehicles, which are also subject to federal rules. The administration must report within 90 days on the number and type of low-speed vehicles on Miami-Dade’s streets, where they operate most BY B LANCA VENEGAS include automotive parts and Americas for the short and midfrequently, their maximum speed, how operators are compensated and supplies, aviation parts and ser- term,” Mr. Mencia said. “We whether state and federal laws are adequate to regulate them, along with Enterprise Florida is hosting vices, education and training are working very closely with any need for further county regulation. services, environmental tech- the Mexican Consulate here in

Mission targets Mexico market

CITY CIRCULATORS ON BUSWAY: County commissioners unanimously passed legislation authorizing municipal circulators to operate on the South Miami-Dade Busway. The ordinance, sponsored by Daniella Levine Cava, aims to enhance existing bus services through new routes that connect to the Busway and the Metrorail. To ensure operational safety, cities along the Busway will submit their plans for new circulator routes operating on the Busway that would require county approval. TRAINING PUBLIC SERVANTS: Miami-Dade commissioners unanimously approved Tuesday re-instating the management training program in the mayor’s office and directed the administration to identify funding for the program in fiscal 2016-2017 and include it in the proposed budget. The nationally recognized program, which ended to save funds during the downturn in 2008, had a number of graduates known for excellent public service, including current Enterprise Florida Chief Executive Officer Bill Johnson, current Deputy Mayor and Public Works & Waste Manage- Jennifer Moon ment Director Alina Hudak, current Water & Sewer Director Lester Sola and current Office of Management and Budget Director Jennifer Moon.

DOING THEIR HOMEWORK: Florida International University this week became one of 115 universities in the nation to be placed in the top research category in the Carnegie Classification of Institutions of Higher Education. In the Florida state system, the University of Florida, Florida State University, the University of South Florida and the University of Central Florida were already in the top category. The University of Texas at Arlington was also added this week. NEW UNIFORMS: Two firms have been chosen to provide uniforms and shoes for the Miami Fire-Rescue Department. City commissioners approved term contracts with Monica Manufacturing Corp d/b/a All Uniform Wear and Global Trading Inc., to provide fire-rescue uniforms and safety shoes as needed. The contracts are for an initial three years, with the option to renew for two more one-year periods. The estimated cost over the five-year term is $2 million.

an Export Development Trade Mission to Mexico City in May for eligible small to mid-size Florida companies that are new to the Mexican market. The mission, scheduled for May 23-26, will be led by Florida Secretary of Commerce Bill Johnson. “We are recruiting companies that are either manufacturers, high-tech companies or have never exported to Mexico,” said Manny Mencia, senior vice president of International Trade & Development at Enterprise Florida based in Coral Gables. “We have room for as many as 30 companies and 28 have signed up already.” But there is a process for the interested companies in order to attend, he added. “The companies that have signed up are vetted by the US Commercial Office in Mexico for suitability for the Mexican market,” Mr. Mencia said. “Only those that are deemed to have a strong chance to do business in Mexico will be approved.” Some of the leading sectors for Florida exports to Mexico

nologies and water, plastic materials and resins, security and safety equipment and services, internet and IT services, medical devices, transportation infrastructure equipment and services, and many others. According to recent Enterprise Florida data, Florida exports to Mexico rose 29.5% between November 2014 and November 2015. Imports were also up by 17.4% for the same period. “[Mexico] is one of the largest markets in the world for US products,” Mr. Mencia said. “It’s by far the fastest growing market for Florida exports in the Western Hemisphere, and I don’t think there’s a market that has as much potential.” Florida companies can also benefit greatly from the new opportunities that will be available as part of the new International Airport, a multi-billion project that will be built in Mexico City in just a few years, Mr. Mencia said. “I think Mexico will be the most substantial nation in the

Miami to develop the mission’s agenda, so many of the questions related to it can be answered in about three weeks before the mission.”

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MIAMI TODAY

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WEEK OF THURSDAY, FEBRUARY 4, 2016

MIAMITODAY Miami Today is an independent voice of the community, published weekly at 2000 S. Dixie Highway, Suite 100, Miami, Florida 33133. Telephone (305) 358-2663

We must link 28 disconnected, mostly-free transit systems Metropolitan mass transit is hard enough to stitch together when it all reports to a single agency. Imagine how hard it must be when 28 governments each do their own thing. Believe it or Michael Lewis not, that’s true in Miami-Dade: 28 local governments run mass transit, yet absolutely no structure binds them together. We rely on informal coordination. At the same time, while 83% of our transit users take fare-paying systems, 17% ride modes that charge not a penny. More than that, many who take the paidfare systems ride either free or at heavy discount under special dispensations. Around the nation, mass transit rarely supports itself even when it charges a fare. But if one-sixth of all riders are on free transit and many others pay little or nothing, money to prop up operations and expansions becomes far scarcer. As rapidly clogging traffic in MiamiDade creates longer and less predictable drive times, and as support for transit of varying modes grows, the lack of politi-

cal will to collect legitimate fares that are plowed back in weakens transit’s ability to meet our needs. These two flaws – lack of system coordination and bypassing legitimate farebox aid – undercut the two major needs of transit: connectivity over a broad community and sustainability over a long period. Back in 2002, funding was to flow from a half-percent sales tax that county voters passed to build transit lines. To pass the tax, however, commissioners agreed to give 31 cities a combined 20% of collections. In turn, 20% to 80% of that municipal share may be used for transit projects. While the county initially misspent the 80% of the tax that it retained by propping up existing transit rather than adding to the system, the same was not true among municipalities, most of which chose to create circulators that we often call trolleys, although they are really small buses. Today, 27 of the 34 municipalities spend much of their share of the surtax on those circulators. Together with the county’s Metromover, Metrorail and buses, that makes 28 separate transit systems in Miami-Dade. As a report Mayor Carlos Gimenez wrote last week makes clear, those systems are not required to work together,

to link together or to coordinate for the betterment of the riding public. While county transit tries to work with the municipalities, he wrote, “each municipality operates independently and has its own individual transportation goals and objectives.” For that reason, he told commissioners, the county transit operation – which last year accounted for 91.2% of all transit rides – can’t plan when or where any city might run a trolley route near county buses routes, nor can it tell when or where a link between the county and a municipal system might be possible. As it happens, at least eight of those systems now link with the county’s, but it’s strictly informal. What a way to run a railroad – much less a transit system. Mayor Gimenez did say that county transit will in the future keep in touch with city systems and suggest route changes, but nobody is in charge. It’s all by goodwill. In fact, the county is getting into the local circulator business itself, with one now in Westchester and another under study in West Dade. Meanwhile, all the municipal systems have to figure out how to stay in business when most of them charge no fares – though Cutler Bay, for example, charges 25 cents a ride and Hialeah

Varied education vehicles drive road to success Miami has experienced tremendous growth and prosperity over the last few years in spite of our rank as one of the poorest communities in America. The changes that have positively impacted our future are largely Daniel Diaz Leyva dependent on the continued success of our educational offerings. That said, higher education is too often associated exclusively with a bachelor’s degree aimed at only certain types of “white-collar” jobs. The reality of our current economic landscape is that we have demand in a number of different fields, many vocational, that can help drive our economy, empower our citizens and improve our lives. In June of 2015, I was appointed by Gov. Rick Scott to the Board of Trustees of Miami Dade College, the largest and most diverse public institution of higher learning in the country. I am privileged to serve with several high-impact leaders, some of whom graduated from the college and countless others who dedicate their time and treasure in furtherance of its mission to change lives through accessible, highquality teaching and learning experiences. In an effort to immerse myself in that mission and serve as a responsible steward for our state, I committed to visiting each of its campuses right off the bat. I wanted to learn about its leadership, its students and the benefits of vocational training for career development. Through that experience, I became more aware of the relationship between vocational training and jobs that are immediately in dire need across our society.

The Writer Daniel Diaz Leyva is a business attorney with Foley & Lardner and a member of the Board of Trustees of Miami Dade College. During my visits, I found a student body mostly made up of recent immigrants with an infectious thirst for knowledge, hunger for opportunity and pursuit of the American Dream. The talent I saw was extraordinary. The Honors Program in particular consists of some of the best and brightest our community has to offer. Their graduates go on to the best universities in the nation, mostly having earned scholarships. That said, are they being trained for the jobs that exist out there? The unemployment rate for young adults is around 12%, close to double the overall rate. It translates to about 2 million unemployed young adults. Yet, there are 3.9 million job openings, many in health care and social assistance, leisure and hospitality, and manufacturing, all industries that seek out vocationally educated graduates but can’t seem to find them. MDC’s healthcare programs housed in the Medical and Homestead Campuses help to train most of the able nurses, technicians and physician assistants in our community’s dental and doctor’s offices, clinics and hospitals. The science labs in the Hialeah, North and West campuses are comparable to some of our nation’s best performing cutting edge research. The aviation programs in Homestead equipped with some of the latest technology help to train and staff our air traffic control systems at our airports. The education program at the InterAmerican campus in particular, its

programs focused on early childhood learning and the developmentally disabled, are the leading providers of teachers to our school system. Our public safety programs at the North campus produce most of the police officers and firefighters that keep us safe. The arts and entertainment programs are fundamentally part of the MDC culture. The programs for aspiring artists, chefs, musicians and studio technicians exist across campuses, particularly in Kendall, North and Wolfson, including the New World School of the Arts, which is truly one of our most amazing cultural institutions. Programs such as the Miami Animation and Gaming International Complex (MAGIC), the hub for entrepreneurship at the IDEA Center and the School of Engineering and Technology (EnTec) reflect a college committed to innovation and the development of new academic programs set by the constant evolution of our global economy to prepare its students to compete for the jobs of the 21st century. There are other institutions in Miami and our state that are also committed to preparing the workforce of the future and do an excellent job with limited resources. The goal is to make our community a better, safer and more prosperous place to live. It’s just important to remember that education can take many shapes and forms, but is always the first step on the journey to success.

matches the county’s fare schedule. Last Thursday, as Miami Manager Daniel Alfonso pledged that the city’s trolley system will add three new routes by March 1, commissioners again touched on their free system’s longterm viability – though they never mentioned charging to ride. Miami started its system with federal grants that probably won’t be repeated as trolleys must be replaced. Where will the money come from? Our municipal systems are not insignificant. In fiscal 2014 they handled a combined 8.3 million rides, Mayor Gimenez wrote, and in 2015 the number was expected to exceed 10 million, a growth of more than 20% in one year, gaining at a far faster pace than the county bus system is losing riders. There is a transportation planning coordinator for the county, the Metropolitan Planning Organization, which so far has not tried to figure out how to stitch the county and municipal transit operations together. But that is about to change. The planning organization, Mayor Gimenez wrote, is preparing a study to coordinate all 28 systems. It couldn’t happen too soon. Nor could a resolve to fund all transit partly from the farebox. A transit fare is fair – and vital.

L ETTERS

TO THE

E DITOR

South Dade better place for Fair, as FIU proposes The Fair’s lease stipulates that if The Fair is required to move, the county must provide an equal or better location. A better location has been identified, and it is in South Dade: it provides more land for expansion and parking (127 acres in South Dade vs. 86 acres currently), it has easy access to the Turnpike and a community that is young, growing and is eager to welcome The Fair’s relocation. The proposal that FIU has put on the table elevates the conversation for all of Miami-Dade. The top winners are local residents who get more jobs and educational opportunities, greater economic activity in South Dade and we still get to keep The Fair – at its new location. We have been talking about this for years. Let’s get this done! Juan Carlos Alexander

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TODAY’S NEWS

MIAMI TODAY

WEEK OF THURSDAY, FEBRUARY 4, 2016

Using cut-away vans temporarily, Miami to add three trolley routes BY JOHN CHARLES ROBBINS

The City of Miami is poised to expand its popular free trolley service in less than 30 days. City Manager Daniel Alfonso told city commissioners Jan. 28 that 10 vehicles are on the way to Miami and the city intends to launch its three new trolley routes March 1. The additions to the fleet will be smaller cut-away vans on a temporary basis. The promise comes on the heels of a Jan. 14 meeting at which commissioners expressed frustration at the delay in getting the new routes rolling. It was last May when commissioners directed the launch of routes in Little Havana, the Wynwood Arts District and Coconut Grove within six months. When asked about the new routes Jan. 14, Jeovanny Rodriguez, city capital improvements and transportation director, said staff was working with the procurement department but “it’s at least an eight-month process… to be able to get those.” As Mr. Rodriguez continued, saying the new routes might be started on weekends, Commissioner Francis Suarez interrupted, telling him to report fully at the

Jan. 28 meeting and strongly advising he call the trolley vendor immediately to get them rolling “right away.” At last week’s meeting, Mr. Suarez introduced the topic of trolley expansion, saying commissioners wanted answers after sensing “a lack of momentum” and wanted to hear ways in which the new routes could be up and running “A.S.A.P.” because “that’s what the residents expect.” Instead of Mr. Rodriguez delivering a status report, his boss, Mr. Alfonso, did the talking. Mr. Alfonso said city officials were talking with the trolley vendor and the plan for a rapid launch would use about 10 cut-away vans, wrapped with city identification and mixed throughout the city on all trolley routes, until the vendor can deliver new trolleys. No timeline for the full-sized trolleys was stated. While characterizing the temporary plan as “kind of a BandAid solution,” Mr. Suarez thanked the city manager and his staff for moving forward. The Little Havana route will have city trolleys traveling on Eighth Street and Flagler Street. Commissioner Frank Carollo said the hope is the trolleys will

enliven the nightlife on Calle Ocho (Southwest Eighth Street), and he asked the times the trolley would run. Mr. Alfonso said the plan was to run the Little Havana route from 6:30 a.m. to 7:30 p.m. Monday to Saturday. “I don’t remember voting on [operating] times,” said Mr. Carollo. “Me either,” said Mr. Suarez, who then brought up his related discussion item: why the delay in extending the Coral Way trolley service to 11 p.m. Mr. Suarez said he wanted to direct the staff to extend hours on Coral Way and the new Eighth Street trolley until 11 p.m. Mr. Alfonso said it is expected to cost an additional $295,000 just to extend the Coral Way trolley to 11 p.m., and he planned to have a resolution to make that change at the commission’s Feb. 11 meeting. When the cost raised a few eyebrows among commissioners, Mr. Alfonso interjected that staff is examining ridership trends and suggested “we can vary the service [levels] and save some costs.” As he has in the past, Commissioner Wifredo “Willy” Gort stressed the need to consider how

Public Notice NOTICE IS GIVEN that meetings will be held before the following Committees on the dates stipulated below in the Commission Chambers, located on the Second Floor, of the Stephen P. Clark Center, 111 NW First Street, Miami, Florida, wherein, among other matters to be considered, a public hearing will be held relating to the following proposed ordinances/resolutions: Transit & Mobility Services (TMS) Cmte. Meeting – Monday, February 8, 2016, at 9:30 AM t 3FTPMVUJPO approving an amendment to the Five Year Implementation Plan of the People’s Transportation Plan to include the Dolphin Station Park and ride/terminal facility t 0 SEJOBODF amending Section 8a-1.2 of the Code; requiring rental car companies to provide notice to their customers of administrative fees associated with any toll charges or toll violations incurred by the customers Metropolitan Services (MS) Cmte. Meeting – Monday, February 8, 2016, at 2:00 PM Strategic Planning & Government Operations (SPGO) Cmte. Meeting – Tuesday, February 9, 2016, at 9:30 AM t 0SEJOBODF amending Section 2-10.4 of the Code relating to acquisition of professional architectural, engineering, landscape architectural or land surveying and mapping services to include a locally headquartered preference t 0 SEJOBODF amending Section 2-10.4 of the Code relating to acquisition of professional architectural, engineering, landscape architectural or land surveying and mapping services to include prior work awarded to affiliates of a proposing firm in evaluating the volume of work previously awarded to a firm Unincorporated Municipal Service Area (UMSA) Cmte. Meeting – Tuesday, February 9, 2016, at 2:00 PM t 0SEJOBODF amending Sections 2-2079, 2-2081, 2-2083, 2-2084, 2-2086, and 2-2090 of the Code; amending provisions related to Voluntary Energy Efficiency and Renewable Energy Program and Property Assessment Clean Energy (PACE); repealing Section 2-2085 of the Code, relating to funding of program Trade & Tourism (TT) Cmte. Meeting – Thursday, February 11, 2016, at 9:30 AM Economic Prosperity (EP) Cmte. Meeting – Thursday, February 11, 2016, at 2:00 PM t 3FTPMVUJPO approving proposed Fiscal Year 2015 Documentary Stamp Surtax and State Housing Initiatives Partnership Funding t 0 SEJOBODF amending Chapter 17, Article VIII of the Code related to the Affordable Housing Trust Fund Board of Trustees t 0 SEJOBODF pertaining to Small Business Enterprise Programs; amending Sections 2-8.1.1.1.2 of the Code to allow participants in the Small Business Enterprise Goods Program to use the existing bonding and financial assistance program available to Small Business Enterprises for construction services All interested parties may appear and be heard at the time and place specified. A person who decides to appeal any decision made by any board, agency, or commission with respect to any matter considered at its meeting or hearing, will need a record of proceedings. Such persons may need to ensure that a verbatim record of the proceedings is made, including the testimony and evidence upon which the appeal is to be based. Miami-Dade County provides equal access and equal opportunity and does not discriminate on the basis of disability in its programs or services. For material in alternate format, a sign language interpreter or other accommodation, please call 305-375-2035 or send email to: agendco@miamidade.gov.

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Commissioners discussed the ability to run city trolleys long-term.

the city will support the trolley service long-term. “We need to understand the operational expenses,” Mr. Gort said. “Once we start something, we need to make sure we maintain it.” Referring to an earlier discussion about a transportation master plan for the city, Mr. Gort said he’d like to look into a plan to link the trolley routes together and to link with trolleys in neighboring cities and with the county’s Metrorail system. Although use of the smaller vans to launch the routes would be a temporary solution, Commissioner Ken Russell wondered if use of the vans on a permanent basis wouldn’t be the better way to expand the public transit service. City officials said that a big part of the attraction and popularity of the city trolleys is the look and feel of the vehicles – rubber-tired buses designed to look like old-time trolleys or

streetcars. Ridership on Miami’s trolley system continues at a healthy rate, noted Mr. Suarez. “They’re working,” he said. “We get applauded for the trolleys.” The trolleys carry about 360,000 riders monthly. Today, the city operates trolleys in Allapattah, Biscayne Boulevard, Brickell, Coral Way, the Health District and Overtown. During baseball season, a stadium route runs to Marlins Park in Little Havana on game days, from April through September. Maps of the routes are on the city’s website at www.miamigov .com/trolley. In November 2011, the commission approved an agreement with the county that laid the framework for the trolley system. Federal grants purchased the first trolleys. City officials often cite the trolley service as one step taken to help alleviate traffic gridlock.

Wynwood traffic snarls lead to talk of new main drag, NW Fifth Avenue B Y C ATHERINE L ACKNER

In many ways, Wynwood is victim of its own success. The former warehouse and manufacturing district has become a nationally recognized center for arts and innovation. Its main drag, Northwest Second Avenue, has become so popular that traffic snarls are common on weekends, during special events, and even sometimes during the week. “We should start the process of creating another entry,” said David Polinsky, a board member of the Wynwood Business Improvement District (BID), at the group’s Jan. 19 meeting. The throngs of tourists and locals who fill the streets “are a marvelous sign that we have had an impact,” but the traffic and parking problems are ever-increasing, he said. Northwest Fifth Avenue “is quiet and underutilized,” he said. It is 70 feet wide, can accommodate four lanes of traffic and has a center median, in comparison to the twolane Northwest Second Avenue. “It is not even striped for four lanes,” said Mr. Polinsky, who chairs the BID’s planning board and is the developer of 250 Wynwood. Decades of neglect have worn away the striping that was done when the street was the center of a

‘We should start the process of creating another entry.’ David Polinsky bustling retail garment district that could be seen from I-95. “At minimum, we should discuss having it re-striped and what improvements are needed there,” Mr. Polinsky said. Private traffic studies and an analysis by the Miami Parking Authority have been done previously, said Joe Furst, BID co-founder and Goldman Properties managing director for Wynwood. “Maybe we can piggyback.” Mr. Furst agreed that the corridor along Northwest Fifth Avenue – some of which will be part of the proposed Mana Wynwood development – is a valuable area that merits more study.

MIAMI TODAY

TODAY’S NEWS

WEEK OF THURSDAY, FEBRUARY 4, 2016

Signature I-395 bridge plan meets renewed call for tunnel BY JOHN CHARLES ROBBINS

The Florida Department of Transportation is closer than ever to starting massive improvements for Interstate 395 that include a “signature bridge” for downtown Miami. And while many welcome the project, Miami Commissioner Francis Suarez continues to question its cost, timing and need. At a commission meeting last week, Mr. Suarez continued to question the project and again suggested the funds set aside for it might better be spent on mass transit. In December he suggested the money be redirected to help fund Baylink, a light rail system to connect Miami and Miami Beach via the MacArthur Causeway. Gus Pego, local district secretary for the state transportation department, update commissioners on the I-395 project last week. The $600 million project is to rebuild 1.4 miles of I-395 from the I-95/Midtown interchange to the west channel bridge of the causeway. Proposed improvements include: Building new elevated ramps, one eastbound and one westbound, to directly link I-95 and I-395. Improving roadway design including updating the alignment and upgrading the roadway surface. Creating a visually appealing bridge. Building vertically higher structures that will improve the visual quality of the bridge. The entire project is expected to take five years. “We all have different obligations,” said Mr. Suarez. The state says the highway is in need of improvements in part to increase the capacity for cars, he said. “It may need to be rebuilt, but is this the right time?” Mr. Suarez asked. “There’s no doubt it will increase [vehicle] capacity – no

Florida Department of Transportation’s conceptual drawing of a tunnel instead of I-395 signature Bridge.

doubt. But is that what we should do?” What about increasing “people capacity?” he added, referring to the ongoing struggle to build Baylink. Mr. Suarez mentioned proposals over the years to dig a tunnel for the road traffic and open the area for park space. A state evaluation estimated a tunnel’s cost at $1.3 billion, he said. While he acknowledged that is a lot of money, he asked people to consider what the city would recapture: 30 more acres of open space hugged by Overtown, Museum Park and the bay. Some may argue that added park space has infinite value, said Mr. Suarez. “We only have one chance to do transcendent projects,” he said. Mr. Suarez said his suggestion of spending the money on Baylink had rallied supporters in the community and there was some support for the tunnel approach.

He said he would consider drafting a resolution for a February vote calling on Mr. Pego to ask the head of the transportation department to consider a “cut and cover” proposal to bury a portion of Biscayne Boulevard in that area. And Mr. Suarez again suggested the money would be better spent on mass transit. Mr. Pego said the I-395 project has been evaluated and planned for nearly 25 years and suggested if it isn’t built the $600 million would fund other projects throughout the state. Commissioners asked what activities were envisioned under a new elevated roadway, as they reviewed renderings showing people walking, biking, playing catch and more. Mr. Pego said the state plans to partner with the city to decide what activities could be encouraged in the new open public spaces. “We want to have a place where people can meet and

greet,” Mr. Pego said. “This project change does give us some use under the freeway,” said commission Chairman Keon Hardemon, whose district includes Overtown, which the project would also affect. “Overtown is changing. I want to bring nightlife to Overtown and people would need a place to park,” Mr. Hardemon said. The chairman added that he is working to make Overtown a community people “walk to, not through.” Commissioner Frank Carollo expressed concern about the city holding up the project, especially “so close to procurement.” Mr. Carollo said, “I hope we don’t miss an opportunity.” Mr. Suarez, vice chairman of the Miami-Dade Metropolitan Planning Organization, planned to meet Wednesday with county Commissioner Audrey Edmonson, who also serves on the MPO board to discuss the I395 bridge project.

Along with a PowerPoint presentation on the I-395 project, city commissioners were provided with a 34-page document from the transportation department, a 2014 evaluation of the tunnel concept. The report itemizes all of the challenges and obstacles to putting the roadway underground. Findings include: Due to flooding potential, both Biscayne Boulevard and I395 tunnels would probably be closed during some hurricanes. Both are vital evacuation routes for downtown Miami and the barrier islands of Miami Beach, and their closure would divert traffic to less effective routes. A project development and environment study of both a tunnel and an open-cut tunnel found them non-viable. The proposed tunnels would require a supplemental environmental impact statement that would probably delay the project another five years. Going underground is potentially very controversial since it would impact several communities in a dense urban area with multiple origin and destination points. The drastic impacts of delays, noise and aesthetics to residents, businesses and tourists in the center of downtown for an extended period could be disastrous. Both tunnels would require aboveground retaining walls in the floodplain to prevent roadway flooding since they are in a flood hazard zone. The walls would partially defeat the prime objective of tunnels, which is to be hidden underground. The tunnels would require extensive excavation in high-risk contamination areas east of Biscayne Boulevard that was once home to the Belcher oil terminal and tank farm and the Perfect service station. Detailed survey and analysis might take three years and contamination treatment could cost up to $27.3 million.

Genting is to build baywalk under I-395 as part of marina BY JOHN CHARLES ROBBINS

Miami city commissioners are adamant about securing an improved public baywalk on the waterfront downtown and beyond. Early last month commissioners approved a resolution calling on the Florida Department of Transportation to provide a baywalk underneath I-395 as part of its $600 million improvement project on the elevated highway. The topic resurfaced at the commission’s meeting last week. Gus Pego, local district secretary for the transportation department, was there with a status report on I-395 project. The highway connects I-95 with the MacArthur Causeway over Biscayne Bay and is hugged on the north by a large vacant parcel that was home to the Miami Herald for decades, and on the south by the Pérez Art Museum Miami and the city’s Museum Park.

The city’s resolution says that a public baywalk connecting Museum Park and the former Herald site would allow enhanced connectivity to Biscayne Bay for the benefit of pedestrians, residents and tourists. Providing a baywalk promenade “allows for increased usage of the vibrant waterfront and public spaces within our downtown,” the resolution reads. As part of the massive I-395 project, the department of transportation has had a series of property exchanges with the City of Miami, Miami-Dade County, and the owners of the old Herald site, Genting Group. The Malaysia-based company purchased the 14-acre newspaper site in 2011 for $236 million. It purchased surrounding properties and announced plans for Resorts World Miami, a sweeping $3 billion luxury casino with multiple towers, stores and an elevated beach and lagoon. Without winning OK for a

‘We’ll work hand-inhand to make sure it happens.’ Gus Pego casino, the plan was scaled back to two residential towers, a hotel and retail. The company has been in a holding pattern for years. There was a land swap between the developer and the state about five months ago, as part of the preparation work for the I-395 project. Draft plans for the prime high-

profile site have included an 800-foot waterfront promenade along Biscayne Bay and a marina. Mr. Pego told commissioners last week that Genting will build the baywalk under I-395 as part of its marina, called for in an agreement with the transportation department. The shoreline in that location would require that the baywalk be extended eastward – “they need to jog out into the bay,” he said. Genting would lease property under the highway and bottomlands to extend the baywalk as part of its marina, he said. “We’ll work hand-in-hand to make sure it happens,” Mr. Pego told commissioners. The information is consistent with moves made by Genting in 2014 to have old easements removed from the former Herald site. Commissioners had questioned the impact of removing the easements. City staff said the Miami 21 zoning code would require a baywalk when the parcel is re-

developed. Commissioners wondered if acceptance of a proposed new plat for the area – entitled Resorts World Miami One – would undo the requirement for a public walkway. Just the opposite is true, said attorney Vicky Garcia-Toledo, representing Resorts World Miami LLC, a division of Genting. Ms. Garcia-Toledo had said a previous property owner, Knight-Ridder Newspapers Inc., got an exception not to have to build a baywalk. That’s one reason the area was replatted, she said, “to remove that restriction.” Without offering specifics of the proposed development, Ms. Garcia-Toledo said a full baywalk is part of its design. Early on, Genting said Resorts World Miami would “serve as a connecting point between the Adrienne Arsht Center, Museum Park, and Margaret Pace Park. This will open up the waterfront to the public and revitalize the Omni neighborhood.”

MIAMI TODAY

WEEK OF THURSDAY, FEBRUARY 4, 2016

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FINANCIAL TRENDS

WEEK OF THURSDAY, FEBRUARY 4, 2016

5-year-old foreign tax compliance act still a work in progress BY JOHN CHARLES ROBBINS

The Foreign Account Tax Compliance Act (FATCA), enacted in 2010 by Congress to target non-compliance by US taxpayers using foreign accounts, remains a work in progress, according to David Resnick, an expert on the law and its ramifications for financial institutions. It took four years for the law to take effect and is still being fine-tuned, said Mr. Resnick, an attorney in Shutts & Bowen’s Miami office, where he is a member of the Tax & International Law Practice Group. The bulk of the burden from the legislation falls on foreign banks, or foreign financial institutions, as the law specifically refers to them. The act requires foreign financial institutions to report to the IRS information about financial accounts held by US taxpayers, or by foreign entities in which US taxpayers hold a substantial ownership interest. The goal is to combat offshore tax evasion and recoup federal tax revenues. Following enactment of the law in 2010, the treasury department worked on and eventually published the Model Intergovernmental Agreement to Improve Tax Compliance and to implement the act. Mr. Resnick said there have been many delays in implementing the law, and the specific rules and procedures remain fluid to some extent. Some terms, like foreign pass through payments, are not even defined yet, he said. But in the face of the delays, the IRS has been accommodat-

ing by affording transitional time, he said. “The IRS was allowing withholding agents to have transitional administrative compliance through 2015,” he said. Mr. Resnick assists foreign and domestic banking institutions, and other foreign entities, with analysis, planning and implementation of the Foreign Account Tax Compliance Act. He also provides FATCA training seminars to financial institutions. Compliance can be more than a little daunting, Mr. Resnick said, noting the voluminous paperwork involved in some reporting requirements. “We are making headway … I’ve dealt with domestic and foreign banks in developing policies and implementing their internal policies and procedures, to make good-faith efforts to comply with FATCA requirements,” he said. Complying with the law is a heavy financial burden for banks, said Mr. Resnick. “It’s going to be a huge cost,” he said. “Banks have had to update their internal systems to perform due diligence and account for new account holders, while dealing with a whole new chapter of the Internal Revenue Code,” said Mr. Resnick. “The cost is already heavy and it’s not even in full swing yet,” he said of the evolving rules and procedures tied to the law. “I work with domestic banks, who are outsourcing computer programmers to revamp their system to ensure FATCA compliance,” said Mr. Resnick. The act also requires US fi-

‘The cost is already heavy and it’s not even in full swing yet.’ David Resnick nancial institutions to withhold a portion of certain payments made to foreign financial institutions that don’t agree to identify and report information on US account holders. Governments have two options for complying with the act: they can either permit their foreign financial institutions to enter into agreements with the IRS or they can themselves enter into intergovernmental agreements with the US. The law has succeeded in capturing tax dollars, Mr. Resnick said. In 2014, the IRS announced that through voluntary disclosure programs associated with the act, it collected about $6.5 billion in back taxes, interest and penalties. That number has helped to shrink the tax gap of unpaid taxes, estimated at $300 billion to $400 billion, so “it’s a step in the right direction,” said Mr. Resnick. Late last year, the IRS upgraded the FATCA Online Reg-

istration System, enabling sponsoring entities to register to obtain a Global Intermediary Identification Number (GIIN). The upgraded system also will allow users to update their information, download registration tables and change their financial institution type. The upgrade also includes an updated jurisdiction list. The Foreign Account Tax Compliance Act Online Registration System is a secure, webbased system that financial institutions and other entities can use to register for FATCA purposes. Launched in 2013, the system allows the IRS to identify foreign financial institutions and certain other entities with FATCA obligations. These entities generally report on foreign financial accounts held by US taxpayers under the terms of FATCA or pursuant to the provisions of specific intergovernmental agreements (IGAs). “The registration system is the backbone of FATCA,” said IRS Commissioner John Koskinen. “These upgrades improve the FATCA process, enabling the registration of sponsored entities and making it easier for registrants to use. Working with financial institutions and through intergovernmental agreements, our progress against undisclosed foreign accounts continues.” More than 170,000 financial institutions worldwide in more than 200 jurisdictions have registered with the IRS. In most cases, foreign financial institutions that don’t comply with FATCA or participate through an IGA are subject to 30% withholding on certain US source payments.

FATCA requires certain sponsored entities (including those covered by an IGA) to have their own Global Intermediary Identification Number for FATCA reporting and withholding purposes by Dec. 31. To facilitate this requirement, the FATCA Online Registration System will now enable sponsoring entities to add their sponsored entities and, if applicable, sponsored subsidiary branches. These entities can be added either individually or by submitting a file containing information for multiple entities. The IRS also provides a Microsoft Excel-based Sponsored Entity Data Preparation Tool for users choosing the multiple record file upload option. As a result of the new sponsored entities and sponsored subsidiary branches, the values available for the GIIN have been expanded. The system was updated Nov. 16. Improvements and additional features to manage user accounts include the following: New questions have been added, such as asking foreign financial institutions to indicate their tax identification number in their country or jurisdiction, if they have one. Other questions relate to identifying the common parent entity of the expanded affiliated group. Certain financial institutions can now change their Financial Institution Type. Member financial institutions can now transfer to another expanded affiliated group without having to cancel their current agreement and re-register. Details: www.irs.gov/fatca

Gables headed to market its bonds to upgrade downtown BY CATHERINE LACKNER

Coral Gables residents and business owners still have another month or so to invest in their city by buying bonds to finance the long-debated Miracle Mile Streetscape project. The city commission on Jan. 26 unanimously approved a resolution locking in a guaranteed maximum price of $21.6 million for the project (which will also include part of Giralda Avenue). Ric-Man International Inc. will be the contractor. The bonds were to have been sold last month, but the sale was delayed until the commission approved the construction estimate, said Diana M. Gomez, city finance director. “We are planning to give retail, smaller buyers and local buyers preference,” Ms. Gomez said in December. Florida investors will have next priority, followed by institutional investors. “We’ll figure out how to let Coral Gables residents know they will have first priority,” she said then. The minimum buy is $5,000, she added. The city plans to use the services of the Sunshine State Governmental Financing Commission,

City commission last week locked in a guaranteed $21.6 million to streetscape Miracle Mile and Giralda.

Ms. Gomez said. “We have used them before; it’s an easy transaction. It’s a conduit to help us issue the bonds for a nominal fee.” Because the city wants to pay for its portion of the project

over 22 years, issuing the bonds was the right choice, she said. “You can’t get a loan with a fixed rate for 22 years, and we don’t want a variable rate,” Ms. Gomez said.

“We are only going to take out what we need,” she said. “We have to issue a preliminary official statement so investors can take a look and decide if they are interested. We’ll see what the

appetite is for these bonds.” The cost, initially put at about $20 million, is to be borne equally by the city and property owners along the two streets affected. During the first two years, the city will cover the interest payments for the property owners, Ms. Gomez said. “We don’t want to burden them at a time of construction,” she explained. And, should Coral Gables decide to upgrade the project by using more expensive materials or adding something to the scope of work, she said, the city will bear the additional cost. Owners were given an option of paying their entire assessment up front, to save on interest and finance costs. A handful of them have already done so, enriching the city’s coffers by $850,000, Ms. Gomez said. Though the city has an AAA bond rating, these are specialassessment bonds, so the city won’t be able to leverage its rating as much as it could if issuing a general obligation bond, she explained. “They are a notch lower by virtue of the special assessment,” Ms. Gomez said. “We will still do very well when we go out to market. We’re in a great position and we have a great story to tell.”

MIAMI TODAY

FINANCIAL TRENDS

WEEK OF THURSDAY, FEBRUARY 4, 2016

Commercial paper banks on low interest, construction costs BY SUSAN DANSEYAR

To accelerate projects, county commissioners approved a financing program Tuesday to pay for a portion of the Aviation Department’s capital improvements that takes advantage of low short-term interest rates and favorable construction prices. The legislation authorizes the department to issue up to $200 million in notes, as necessary, for temporary and immediate funds to use toward a portion of its capital improvements scheduled to start in fiscal 2016. Called a commercial paper program, the notes are a short-term debt from a finance company or relatively large industrial firm that would be repaid from the proceeds of future aviation revenue bonds. Commissioners unanimously approved the ordinance. According to Deputy Mayor Edward Marquez, a commercial paper program will allow the Aviation Department to “respond quickly to the pace of construction and changing financial market conditions, ultimately allowing more construction to take place while prices

Photo by Maxine Usdan

The commercial paper program approved Tuesday will speed upgrades at Miami International Airport.

are favorable and minimizing the cost of financing.” The administration has said the department needs the funds to meet current and forecasted intensive capital demands at Miami International Airport and the county’s general aviation airports.

The program would require a commercial bank with high credit ratings to issue a letter of credit, providing liquidity for the notes. The letters are necessary in case the notes can’t be remarketed quickly or if the county can’t issue its revenue bonds when required to repay

the principal and interest of the notes. The commercial paper program would last five years. Extending it longer would require commission approval. Once the full $200 million has been issued, the county will issue long-term, fixed-rate avia-

tion revenue bonds to pay off the outstanding notes. Then, additional notes can be issued to maintain construction activity. To fund the department’s capital improvement program, the county has authorized $1.9 billion in airport revenue bonds. To date, $1.618 billion has been issued. Mr. Marquez explained in a memo to commissioners that the Aviation Department would issue the notes as needed to maintain construction activity. The commercial paper program will expedite the capital projects, he said, “which may lead to savings by taking advantage of historically low short-term rates and favorable construction price.” To set up the program, the administration must direct the county’s enterprise segment financial advisor, First Southwest, to seek proposals for a commercial paper dealer. Once one is chosen through a competitive process, the county will negotiate reimbursement and remarketing agreements and present them to the commission for final approval.

More assets, consumer confidence likely to buoy loan totals BY SUSAN DANSEYAR

Notwithstanding global weakness and the fiercer than expected turmoil in stock markets for the beginning of 2016, market watchers and bankers are predicting loan totals will remain on the same healthy pace this year in Miami-Dade or even grow, given increasing asset levels and consumer confidence. Loan activity in our county continues to improve, according to Karen Dorway, president and director of research for BauerFinancial, the national independent bank and credit union rating/research firm. She reports loans outstanding for the 33 banks headquartered in Miami-Dade increased 19% during the 12 months that ended Sept. 30, while delinquent loans dropped 29% in the period. In addition, repossessed real estate fell 34%. These positive trends were even better than if BauerFinancial evaluate all banks with branches in the county, as opposed to being headquartered here, Ms. Dorway said last week. “The 67 banks with branches in Miami-Dade showed an 8% increase in total loans, a decrease in delinquent loans of 21% and a decrease in repossessed real estate of 49%.” Manuel Lasaga, president of StratInfo and a clinical professor in the finance department at Florida International University, said loan growth continued at a healthy pace, based on third quarter data for local banks headquartered in Miami-Dade. That’s about 34 banks, which he said is a good-sized sample. These local banks have had two good years of loan growth, although the acceleration was moderate in 2015,

Karen Dorway: loan activity rises. Manuel Lasaga: bank capital vital. Jorge Gonzalez: an historic year.

Jay Pelham: stronger results due.

a new brand and was acquired by Banco de Credito e Inversiones of Chile. Net income was $47.4 million in 2015, compared to $42.9 million in 2014, a 10% increase. Fourth quarter net income was $11.5 million, compared to $10.1 million in the same period a year ago. The bank’s 2015 achievements include surpassing $6 billion in assets during the second quarter and surpassing $4 billion in loans during the third quarter. The bank closed $1.6 billion in new loan commitments during 2015, compared to $1.4 billion in 2014. Commercial lending saw a significant uptick, its officials say, with commercial mortgages up 30% and commercial lending up 23% over 2014. “This was a history-making year for City National Bank, not only because of the bank’s significant growth and strong financial performance, but also because 2015 marked a host of new achievements, including the completion of the company’s sale to Banco de Credito e Inversiones,” President and CEO Jorge Gonzalez said in a written statement. “We enter 2016 better than ever with the backing of a strong parent

company and with plans in place and that will enable the bank to surpass 2015’s success.” TotalBank also released a report last week that included “record-setting earning” of $15.8 million for 2015, exceeding 2014 net income by $5.2 million or 50%. The bank also reported a net income of $4.1 million for the fourth quarter, up 33% from to the fourth quarter of 2014. According to the report, net loans rose $34.5 million in the time period, growing at an annualized 7% for the quarter, residential loans increased $21 million and commercial real estate loans rose $19 million. For fiscal 2015, TotalBank generated net loan growth of $131 million, up 7% from last year. The residential mortgage division contributed $114 million of the net loan growth. Additionally, officials say, the bank increased net interest income by $3.1 million, up 4% from 2014. “We look forward to helping our customers grow their businesses and achieve their financial objectives in 2016, which will translate into even stronger results for TotalBank in the upcoming year,” said President Jay Pelham in a written statement.

Dr. Lasaga said. Loans increased 13% in the first three quarters of 2015, year-over-year, and 15.4% for the same time period in 2014. “That may be attributed to local banks needing to grow their capital,” he said. “In general, it’s been increasing at a slower pace than lending, so banks seeing good demand for loans may need to beef up their capital.” In terms of performance growth in overall portfolios, Dr. Lasaga said single-family residential lending is showing the fastest growth rate. Commercial real estate is also seeing healthy lending, he said. However, local bank loans to businesses, relative to real estate, has grown more slowly, Dr. Lasaga said. He attributes that in large part to the strengthening of the real estate market. “We’re seeing the tail end of the recovery from 2008,” he said. “That’s encouraging for a bank looking at that collateral.” Looking to 2016, Dr. Lasaga expects loan growth to be similar to what local banks experienced in 2015. South Florida, he said, is certainly helped by lower energy prices, and people will want to travel here.

“It’s better to expect another year of the same growth than a downturn, but we face challenges,” Dr. Lasaga said. He pointed to a number of crossroads that banks will have to face, including increased competition for lending, the fact that the equity market is still quite nervous and uncertainty about the international side of local business. No one knows when the Feds might raise interest rates, but Dr. Lasaga said it could very well be two or three more times in 2016. At that point, local banks might have to look at how much room they have to bump up lending rates and will have to examine what strategies they’ll use to increase capital in order to raise lending totals. Local bank officials appear extremely confident as they enter 2016, with several saying they hope to surpass 2015’s success. City National Bank recently announced its financial results for the fourth quarter and fullyear 2015, posting strong gains in profitability “as the result of significant boosts in lending, deposits and assets.” It was a year of milestones for City National Bank, officials wrote, as the company launched

TODAY’S NEWS

MIAMI TODAY

WEEK OF THURSDAY, FEBRUARY 4, 2016

Owner seeking tenants for riverfront mega-yacht marina BY JOHN CHARLES ROBBINS

The plan to build a secure marina for mega-yachts on the Miami River continues to evolve as the owner-developer works to secure tenants for his unique commercial venture. SeaVault is designed as a temporary home for mega-yachts with living quarters for captain and crew. The plan includes a clubhouse, tennis court, swimming pool, cold storage building and private vehicle parking on a secured site with tropical landscaping. “We are in process of our sales, and we’ve had a great interest from several vessel owners,” said developer Homero Meruelo. “We are working with them on a daily basis.” Mr. Meruelo’s team is also preparing to present the SeaVault plan to county officials for approvals. He hopes to go before Miami-Dade commissioners in 60 to 90 days. First announced in 2014, the

SeaVault plans include clubhouse, tennis court, swimming pool and living quarters for captain and crew.

project has advanced slowly as government approvals and permitting have been sought. The Miami River Commission has endorsed the plan, and Mr. Meruelo said he’s gained the approval of city planning

and zoning officials. The SeaVault project earned the support of the river commission in part because members said it helps maintain the busy waterway as a working river, with active commercial

marine uses. The developer says the project will bring to the Miami River the very sought-after mega-yacht industry, which has gravitated toward Broward and Palm Beach counties.

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Mr. Meruelo launched a sleek website for the development last August, coinciding with sales of the slips and accompanying quarters. The site is on the south side of the river, at 1583 NW 24th Ave. The property has been home to a working marina for decades, with some of the structures dating back to the 1940s and ’50s. The property used to be known as Florida Yacht Basin, and was identified by the original Miami River Corridor Urban Infill Plan as “an ideal location for a mega-yacht boatyard and mixed use site.” The project was originally called Miami Mega Yacht Marina, and proposed a facility for up to 16 mega-yachts. In early 2015, the plan was renamed and the site plan altered a bit. The plan gaining the approval of the river commission in March carved out slips for up to 14 mega-yachts. Mr. Meruelo says the exact number will be determined by the owners he is able to line up. “The configuration of the marina and the sizes will be changing according to everybody’s needs. Until we’ve secured the actual sizes and users, we can’t go for our building permits,” said Mr. Meruelo. The length and width of the owners’ vessels affects the overall project, he said. “The larger the vessels, the less slips. The smaller the vessels, the more slips,” he said. Mr. Meruelo declined to discuss how many owners have purchased a spot in SeaVault, but he said interest in the project remains strong. “We’ve had interest from not only individual users but from boat manufacturers,” he said. The boat manufacturers have expressed an interest in slips at SeaVault for areas that could be used for warranty work on the large vessels, and for temporary staging or delivery purposes, he said. “It’s the only project in Florida that allows you an enclosed berth,” Mr. Meruelo said. Architects working on a project say it is the first of its kind in the world – everything in one location for the owners of big boats. “They belong on the Miami River, sheltered and closed, and in close proximity to all of Miami’s social life,” Mr. Meruelo said of the all-in-one marina. The only other venue providing a place to keep the larger mega- and super-yachts is the new marina on Watson Island called Deep Harbour. Considered phase one of the large mixed-use project called Island Gardens, the deep water marina opened Jan. 8. Mr. Meruelo said he was looking forward to the opening of the Island Gardens marina, seeing it as a conduit to his venture. He views Deep Harbour as transient and SeaVault as more permanent. “We complement each other,” said Mr. Meruelo. Details: seavaultmiami.com

MIAMI TODAY

WEEK OF THURSDAY, FEBRUARY 4, 2016

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MIAMITODAY A Singular Voice in an Evolving City