The Stierheim Report

An old pro is recruited to undertake a very disagreeable mission: Dig into the stinking mess at Miami City Hall. Here's what he found.

What is your preliminary assessment? Do they seem liable to you?
I am not here to try anyone in the press. I mean, I know some of the principals. I consider them good friends. I have worked with them in many civic causes and they have been civically very active -- I hope you put that in there. But how the city could get to the point that it is without having the red flags raised is hard for me to understand. Maybe there are explanations.

I went through the financial report. I raised the question on the $21 million [bond issue] for the Riverside Center building as to why that was in the general fund. That was a serious question to me. Certainly the issue of the pension bonds -- I think that should have jumped out at everyone: What was the city doing? This is hand-to-mouth existence. This is hawking the future by putting third and fourth mortgages on the city to pay for operating expenses. What is going on? So I think there were enough indications that the flags should be raised. Now, in their defense, they haven't had their day in court. I am not here to condemn them, but I think there are very serious questions. I think the commission was totally within its right to raise those questions and to ask me to do what I am doing now.

Criticism of the internal auditor has been more muted, or at least more private. How effective was the city's internal audit system?

Based on a very cursory review, essentially they were focused on cash transactions involving concessionaires, lessees, anyone who was doing business on city property or for whom the commission had granted a license right or franchise to do business. I was very dissatisfied that they were not auditing the finance department, that they were not evaluating internal controls. I was told that they had the capability of doing an operations audit. If they did one, I don't know when or where it is.

If I was going to be the city manager, I would significantly include within the scope of the internal auditor's responsibility a watchdog role on internal movement of taxpayer money, bond money, guarantee entitlement trust money, grant money, and so forth. They cannot in my judgment just ignore that. Just look at what we are dealing with today.

The internal auditor resigned. Did you ask for his resignation?
Let's say it was a mutual understanding. He offered to resign and I accepted.

You have publicly criticized the contracts the city signed with the labor unions. The ability of labor and management to work well together has been cited as among the great achievements of Odio's administration. What is your criticism?

My specific criticism was that management had in my judgment abdicated its responsibility in the collective-bargaining process. I have complimented union leaders on the contracts they received, because from a union standpoint, they are great contracts.

What was so great about the contracts?
Well, for anyone who takes a look at them there are tremendous concessions that management gave. I am not telling you what to do, but you should just read the page that deals with the city's ability to reopen the collective-bargaining process. I mean, just read that page. The city knowingly, intelligently, and rationally waives its rights to renegotiate this agreement. Knowingly, intelligently, and rationally is not the word. It's another very strange word -- unequivocally or something. We will never even think about doing this. Then it goes on to say the only way you can avoid that is by declaring a true fiscal emergency. And even then, before you do that, you have to exhaust all the commission's options on raising money. And so the commission has to go through 40 hoops before it can get [the union contracts] to the table. And then it goes by the arbitration proceedings and the arbitration is final. And that's just one [problem]. I'm not even talking about all the perks and the five percent here and the five percent there and the take-home cars in the contract with the police.

Do you have an understanding of why these contracts were so generous?
I want to go off the record.
We can't.
Then I'll leave that to the public to decide.

You've deliberately withheld criticism of individuals, including Manohar Surana and Cesar Odio -- Odio having run the government for the past eleven years. Why have you been so careful not to criticize them?

I don't see my responsibility as being in any way, shape, or form having anything to do with persons, personalities, or what have you. It is in my judgment unethical for a professional manager to publicly criticize the previous manager. I find that repugnant. Besides, I have, er, I had a professional relationship with Cesar for twelve or fifteen years as county manager since he was hired here as an assistant [in 1980]. I've known him a long time. This is a tragedy. I feel sorry for him.

I feel sorry for the city, but I have a professional responsibility to describe what I find. So people can talk conspiracy and blah blah until they're blue in the face. Except that just doesn't hold up.

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