By Michael E. Miller
By Ryan Yousefi
By Kyle Munzenrieder
By Sabrina Rodriguez
By Michael E. Miller
By Carlos Suarez De Jesus
By Luther Campbell
By Kyle Munzenrieder
The 56-year-old District Five commissioner was reacting to the plight of a Jamaican-American woman who ran a T-shirt store at Bayside Marketplace downtown. She had just alleged that Rouse Miami, the company that owns the mall, had evicted her because she is black. "African-Americans are having a very tough time," Teele informed. "Cubans are doing very well in this community, thank you very much, and nobody begrudges them. I certainly don't. But the fact of the matter is that what is going on at Bayside is no different from what is going on all over this city."
As usual Teele's powerful oratory had some basis in reality. After 40 years of so-called desegregation, the Overtown and Liberty City sections of the commissioner's black-majority district are still deprived, isolated ghettos. But there was more than a little hyperbole, even paradox, in Teele's words. As seasoned city hall observers can attest, his fiery outbursts regarding one matter can be related to quite another.
In this instance that other had popped up just recently. Commissioners Johnny Winton and Joe Sanchez had started to publicly question the integrity of Teele's reign as chairman of the board of Miami's Community Redevelopment Agency (CRA), whose very mission was to revive black businesses in the economically distressed zone encompassing Overtown and downtown's deteriorated northern fringe. Triggering the questioning was an auditor's report that had found serious flaws in the CRA's record-keeping and financial reporting. Teele reacted angrily, suggesting that a certain Cuban-Anglo collusion first waged against him four years ago was alive and well. Now, two weeks later, Teele had broadened the eerie thesis. "There is a quiet conspiracy to keep black people out of business," he reiterated, and after five more minutes of diatribe fell silent.
Winton and Sanchez had listened impatiently and were not buying it. It didn't help Teele's logic that the lawyer in charge of evicting the Bayside shopkeeper was a successful black woman, or that George Knox, one of the county's most prominent attorneys, who also is black, was on hand to mediate.
And of course Teele is quite prosperous himself. From humble beginnings in Arkansas, he became a decorated Vietnam War vet, a Florida State law school graduate, head of the Urban Mass Transit Administration under Ronald Reagan, and president of the National Business League, the largest African-American chamber of commerce.
In 1996 Teele was able to raise $1.2 million in an unsuccessful race against Miami-Dade mayor Alex Penelas. After winning his seat on the city commission he disclosed a net worth of $2,058,365, most of which he accumulated as president of two business consulting companies. (The figure would have been higher if not for the approximately $1.2 million in debts reported on that disclosure form, including a $350,000 bill from the IRS.) On top of it all he is chairman of the CRA, an agency entrusted with millions of dollars of tax revenue, over which he has presided like a CEO. Certainly this town had not kept him down.
Teele's militant flareups fall increasingly on deaf ears even in his own district. He's had five years as a Miami commissioner and CRA chairman to help lift up black businesses, create affordable housing, and otherwise end blight and economic distress. Key constituents in Overtown and Liberty City believe he has failed to carry out the mission, while the CRA spends millions of dollars for consultants' fees, staff salaries, and other activities that have yet to transform the zone. "He has a good heart," observes Bob Tyler, a construction contractor who left the CRA in early 2001 after a year there. "But the general consensus is that he really doesn't want to get it done, that it's just a smoke screen." Ratcheting up the pressure on Teele is a group of restless real estate investors bent on reviving pieces of the CRA dead zone with lounges, cafés, lofts, and galleries like those in the fabled Manhattan districts of SoHo, Tribeca, and Chelsea.
And now there was this irksome audit. Teele, the big D.C. fish in a mid-size municipal pond, the most powerful, elegant member of the Miami Commission, was in mid-crisis.
Teele's troubles had started to loom over Dinner Key on June 27 as the commissioners, who also act as the CRA's board of directors, turned to thick three-ring binders that contain the agency's agenda. The agendas are complicated, the mission more so. Since 1997 the Miami CRA has reported total expenditures of approximately $10.6 million, according to the agency's financial statements. Of that about nine million dollars has been spent over the past year. The CRA currently has about six million dollars in its accounts, with $13 million more that the city could currently appropriate.
Since his 1997 election the CRA has been Teele's deal. As chairman he controls the agenda, which is drafted by CRA staff. His experience in federal and county government made him the logical commissioner to take the lead. For a long time, commissioners Winton and Sanchez allowed him to do so.
But for a long time they were also bothered that they often received copies of the agenda just a day before the meeting, which left them insufficient time to study complex items requiring them to vote on large expenditures of public money. "We probably could [address CRA agenda control] if we wanted to," Winton, who is the CRA board vice chairman, told New Times in early June. "But it's about which battles you want to pick and how you want to pick 'em. Which ones are the important ones. And I don't have an answer to that yet."
At the June 27 meeting, however, Winton did pick one. Sanchez and Commissioner Angel Gonzalez joined in. They suddenly had more than tardy agenda books to worry about -- there were alarm bells about bookkeeping problems at the CRA. They were just now receiving the results of the very tardy Fiscal Year 2000 audit from the city's independent auditor, KPMG. The CRA has "inadequate record-keeping," stated a KPMG letter dated October 25, 2001. The agency's financial reporting system "is not adequate to provide management with complete, accurate, and timely information needed to prepare the financial statements in accordance with accounting principles generally accepted in the United States of America," KPMG added. "Certain legal documents and other long-term agreements, including loan agreements, bond indenture agreements, and contracts, were not readily available."
Then KPMG accountant Ken Leon took the podium and told commissioners that CRA's acting executive director Annette Lewis had received that letter back in March. Commissioner Winton was miffed. "Okay, Commissioner Teele," Winton began. "Just so you know, I asked Miss Lewis point blank ... just in the past two or three weeks, and she did not tell me that the [KPMG] letter was in her office." When Lewis took the podium she admitted she had received a draft of the letter in December but wanted to respond to it in writing before sharing it with commissioners. "Well, that's what I should have heard," an exasperated Winton scolded. "I don't want to be mad at anybody. I just want to know the facts, the truth, so that when we get it I can deal with something."
To make matters worse, Leon told commissioners KPMG hadn't been able to finish the Fiscal Year 2001 audit of the agency. "The bottom line was the [CRA] books really never got closed," he informed, chagrined. Moreover, he had sent two letters to then-CRA executive director Deepak Parekh offering to help close the books. "But because of budget constraints, at least this is what we were told, they didn't hire us to help them close the books," Leon revealed. (Parekh quit the CRA a month after Lewis arrived.)
Another problem: a troubling turnover rate of chief financial officers. Three of them from 1999 to 2001. None, Leon had learned, had significant experience with CRA or city operations. And Lewis, who was hired in July 2001 to be the CFO, had spent almost a year trying to do that job and that of executive director. Leon said that situation could not stand. "Your executive director should be functioning as an executive director, not as a bookkeeper," he instructed. "She cannot serve in dual roles. It does not work. There is not enough time in a day for her to do that."
And the situation right now at the agency with millions of city and county tax dollars at its disposal? "The CRA doesn't have the accounting staff necessary to maintain the books and records, and to prepare the financial statements," Leon lamented.
Ironically it was Teele who suggested the agency was starting to look like the bad apples of corporate America. "At this point in time where we all are with Enron, with Worldspan [sic], with MCI. You know, this is the ugly side of being the accountant."
"And we don't want the next headline to be CRA," Winton interjected.
But it was too late. Something seemed to have gone dreadfully wrong.
Teele, whose second-floor riverview offices in the east wing of the Ramada Dupont Plaza Hotel are adjacent to Lewis's, was faced with having to explain how a year could pass without either of them realizing the gravity of the situation. Having Lewis perform both jobs was in line with his strategy of keeping expenditures for staff salaries down.
But now he realized he had been "penny-wise and pound-foolish." And offered this novel idea: "I believe that the CRA must not continue to try to save money, but we must go out and find an executive director who can run the operations and allow Miss Lewis to continue to function in the role for which she was hired."
He had thought an executive director-deputy director of finance position could work, he added, because the CRA has been "heavy" on the planning side and on the design side. "Remember," he told his fellow commissioners, "between '98, '99, and 2000 the CRA has primarily been engaged in consulting, studies, developing a master plan, developing the framework for what it is that we're trying to begin to launch." He conceded, however, that he may have made some "bad judgments."
Since July 1999 the CRA's "launch" expert has been Richard Judy, who from 1971 to 1989 was director of the county's aviation department, which runs Miami International Airport. Judy is currently one of the directors of a company called Miami Homestead International Airport, Inc., along with Carlos Herrera, Juan Mas, and Adrian Pedro. This latter threesome was also behind Homestead Air Base Development, Inc. (HABDI), which last year lost its seven-year struggle to build a sprawling international airport adjacent to the already-battered Everglades and Biscayne national parks.
Judy is known for his aggressive expansion of MIA as it became one of the busiest in the nation. As one long-time county government expert puts it, "He had a kick-ass, get-the-job-done kind of approach, sometimes running roughshod over the sentiments of elected officials." And sometimes over other things. He resigned in 1989 after county commissioners learned he had spent $300,000 without their approval. The money had gone for a feasibility study on building a racetrack at the Opa-locka airport. The commissioners soon also quashed a $74,000 contract Judy had signed with lobbyist Sylvester Lukis to persuade then-Gov. Bob Martinez to push for a new international airport in northwest Dade. The Miami Herald piled on with an exposé revealing that over the course of two decades at MIA, Judy had guided $32 million, in amounts small enough not to require commission approval, to consultants, some of whom were friends or former associates.
The planning side of the CRA was heavy indeed when Teele asked general contractor Bob Tyler to join the team in February 2000. "He said, 'Dick Judy is doing a great job at strategic planning but, Bob, no projects or programs are moving,'" Tyler remembers. "So he asked me to come on board and try to move the projects, basically. Get them from the planning stage to the construction stage." At the time Tyler, president of IGWT Construction, was working on projects at the Fort Lauderdale International Airport. He had met Teele in the early Nineties while working as a contractor at MIA and Teele was chairman of the county commission, which appropriates money for the airport. Tyler's work at MIA had also put him in contact with Judy. "It's really a small world," Tyler explains. "Everybody kind of knows everybody. All of the real players anyway."
Tyler agreed to work with Teele at the CRA for one year and then head back to the private sector. "You know, I'm thinking from a construction standpoint that all I've got to do is take a set of plans and go build what's there. I had no clue of this intergovernmental, quasi-governmental agency called the CRA," Tyler recalls. "I learned quickly when I came on board what was planned wasn't funded." Tyler was also struck how the CRA spent "a tremendous amount for legal fees, a tremendous amount for consultant fees, and a tremendous amount for salaries."
When Tyler started, he learned that Bermello, Ajamil & Partners had drafted preliminary plans for three little parking lots on NW Tenth Street in Overtown to service small businesses on Third Avenue. But engineering plans still had to be done. Legal matters involving acquisition of the land for the lots caused further delays. Tyler was disappointed and frustrated when his year was up -- the only brick-and-mortar projects that he actually saw built were the three lovely parking lots, with about eight spaces each.
"If you [calculated] what you spent on consultants and legal and technical and architectural [support] and staffing," Tyler notes, "those parking lots are multimillion-dollar parking lots. That's a sad story and a sad indictment of the process. But the numbers are what they are."
When New Times filed a public records request to review details of CRA expenditures, executive director/chief financial officer Lewis replied through an assistant that the agency didn't have sufficient staff to comply. The city's finance director, Scott Simpson, whose department actually issues the checks, promptly fulfilled much of the request, though. The only thing he could not provide was names of consultants who are on the CRA payroll. "The City has no detailed records for the human resource activities of the CRA," he noted. "The CRA retains all of these records." Simpson declined to comment on the state of the agency's record keeping. "I don't want to get dragged into this," he explained.
Lewis eventually offered the missing payroll information. Richard Judy, whom she calls her "Chapter 163 guru," referring to the Florida statute that governs community redevelopment agencies, currently bills the CRA $150 per hour "through" H.J. Ross and Associates, the CRA's consulting engineering firm. Judy's hours are capped at 32 per week, she noted, which would mean he gets only about $249,000 a year for his expertise. (Judy did not respond to several phone calls seeking comment for this article.) Cesar Calas, another H.J. Ross consultant, pulls in a mere $130 per hour from the CRA, the equivalent of about $220,000 a year on a 32-hour week.
Annual salaries of full-time CRA staff range from Lewis's $89,900 down to $25,000. The roster includes a construction management director, a legislation and policy administrator, an accounting clerk, a business developer, a special events coordinator, an architect-intern, a secretary, an administrative assistant, and a receptionist.
Aside from spending more than a million dollars a year in salaries on in-house personnel, the CRA pumps tax money to a wide variety of companies, groups, and individuals inside and outside the redevelopment zone. Here are some amounts (rounded to the nearest thousand) from the past two years.
For construction, engineering, planning, and design firms (including the ongoing Margaret Pace Park renovation): $1,016,000 to Danville-Findorff (construction)
$706,400 to Civil Cadd Engineering (planning)
$375,000 to Terremark Worldwide to help pay for its NAP of the Americas, one of five network access points in the United States for Internet providers and carriers (the big box-shaped building near the old Miami Arena)
$368,000 to TLMC Enterprises (parking lots and fencing)
$148,000 to Dover Kohl (master planning)
$111,000 to ATC Associates (environmental engineering)
$63,000 to Bermello, Ajamil & Partners (architecture and planning)
For legal services: $615,000 to Holland and Knight
$79,000 to Katz, Kutter, Haigler, Alderman
$53,000 to Doug Bruce & Associates
$22,600 to Bercow and Radell (they contributed $2000 to Teele's re-election campaign)
For financial services: $40,000 to RBC Dain Rauscher (Minneapolis)
For a construction trade school: $94,000 to the now-closed Construction Management Institute (located in Ramada Dupont Plaza Hotel, as is CRA)
For various office-related needs: $146,000 for rent
$90,000 for materials and supplies
$73,000 for copies and printing
$39,000 for temporary staff
$22,000 for furniture -- new
$15,000 for other equipment
$20,000 for parking
$12,000 for travel and per diem
$1800 for paintings by Overtown-based painter Ernest Felder King
For food expenses: $3268 to Two Guys Restaurant (Overtown)
$1360 to People's Barbecue (Overtown)
$627 to Jackson's Soul Food (Overtown)
$5490 to Grunberg's Deli (Downtown)
$2137 to Capitol Grille (Brickell)
For Overtown Optimists football uniforms: $23,000 to Matty's Sports (Miami Lakes)
$7500 to J & M Athletic Wear and $54,000 for other "promotional" activities
For Teele's longtime friend Bobbie Mumford: $7200 to B Mumford & Company, a public relations firm (she also earned about $15,000 from the commissioner's campaign last fall for advertising and printing services)
As chairman of the city commission's Overtown Advisory Board (OAB), Irby McKnight should be one of the most informed people in Miami when it comes to CRA spending. He campaigned for Teele in 1997 but now distrusts him so much he has begun to organize a petition drive to recall the commissioner. But he admits he is practically clueless. When Teele visited once, McKnight remembers, "The chairman told [OAB member Dorothy Fields] that he didn't have to reveal where the money was being spent. Since he got bigger than the law there was nothing we could do about it." He is convinced Teele doesn't want people to know the details about where CRA money is going.
McKnight and other guardians of Overtown are critical of Teele's willingness to send tens of thousands of CRA dollars to wealthy outsiders, such as Overtown landlord Solomon Yuken, who owns a gutted three-story apartment complex on NW Third Avenue between Tenth and Eleventh streets. "He seems to be able to get CRA money," McKnight grumbles. "I just assume there's a big payoff there." The CRA board recently approved a $419,000 grant to help Yuken renovate the building.
Teele calmly deflects such suspicions. "We're not working on one project in Overtown that is not a part of a plan," he recently told New Times. "The Solomon Yuken [project] is part of a [design] charrette that happened two years ago. It's not just something I pulled out of --" he continues, gesturing to his rear. Moreover, Yuken backed Pierre Rutledge, Teele's opponent in 1997, the commissioner added. "There's no question that there is no love lost between Arthur Teele and Solomon Yuken. That's widely known.
"The fact of the matter is," the CRA chairman contends, "that there is more happening in Overtown now than has ever happened. And all of it goes back to a redevelopment authority that's aggressive.... Certainly if you look at the property values and the property rolls you'll see, for the first time property values are moving in Overtown. Dramatically."
Some property values are up indeed, but "aggressive" is not the word Art Noriega would use to describe the CRA. Two years ago Noriega, the executive director of the Miami Parking Authority, had signed a contract to purchase a vacant lot at 1001 North Miami Ave. and an adjacent warehouse for $1.6 million. His plan was to build a public garage there, in line with the authority's mission to create public parking at reasonable rates. Specifically, Noriega was responding to concerns of several new property owners in the CRA zone who were planning to open restaurants and clubs, mostly in the blighted blocks north of I-395 and west of Biscayne Boulevard. Noriega was also advancing discussions with the Florida Department of Transportation regarding plans to build parking lots under the I-395 overpass. From there people could easily walk north or south into an expanded downtown arts and entertainment district surrounding the future Performing Arts Center.
When Noriega informed the CRA chairman of the deal, however, Teele insisted that the parking authority cancel the contract. The commissioner wanted the CRA to control parking projects in the redevelopment zone. Noriega obliged, annulling the purchase agreement and putting his I-395 plans on hold.
In early 2001, a corporation named Fast Park bought 1001 North Miami Ave. for $950,000. According to Florida state records, the company is operated by a firm called Downtown Miami Management Group, whose president is Gregory Mirmelli.
But nearly two years after Noriega backed off at Teele's request there was still no progress toward lots under I-395 or toward a garage on the Mirmelli property. Last fall Mirmelli happened to contribute $500 to Teele's re-election campaign. Then at a CRA meeting in early June an item proposing a $3 million purchase of 1001 North Miami Ave. appeared on the agenda.
Teele flatly denies he was influenced by a simple check. "I understand that Mirmelli contributed to my campaign. But I was unaware of it," Teele says. "He didn't hold a fundraiser for me." Mirmelli subsequently backed away from the deal. Last month Teele agreed on a plan under which the CRA would build the lots under I-395 and the Miami Parking Authority would operate them.
Even so Noriega says if Teele had not intervened, parking under I-395 would now exist, a garage at 1001 North Miami Ave. might be completed, and a few more pioneers might have opened up bars and restaurants in the CRA zone. "This should have happened two years ago," Noriega chides. "It could have happened."
That Teele has been under fire from Overtown residents and activists is not breaking news. But earlier this year the commissioner felt pressure from a relatively new source -- a contingent of real estate investors eager to transform parts of the CRA zone into an urban playground, a subtropical Chelsea. In addition to several Miami area natives, the group includes three Israelis, a Brazilian, and an Englishman. Most of their properties are located west of Biscayne Boulevard between the I-395 overpass and NW Fourteenth Street. It would be a destination for the downtown business crowd, club-hoppers tired of South Beach and Coconut Grove, and future concert-goers to the Performing Arts Center.
"We're building a neighborhood," says 44-year-old Gil Terem, a Tel Aviv native who moved from New York City to Miami three years ago. Terem specializes in reviving old abandoned buildings and speaks romantically of seeing them fill up with "light and life" after he cracks them open for the first time in 30 years or more. "They're like works of art," he says of his renovations. Terem is planning to turn one building on NE Fourteenth Street into a 24-hour sandwich bar. "The type of business where you can stop there any time day or night and grab a nice sandwich, salad, fruit, coffee. That's going to serve all the area. It's going to have a very stylish and tasteful design," assures Terem, who owns a similar establishment in the Tribeca section of Manhattan.
Glimmers of a trendy transformation began more than three years ago. The pioneer was Big Time Productions owner Eugene Rodriguez, who converted an old ice factory in Overtown into a sound stage and office complex known as the Ice Palace. But the nearby 24-hour Art and Entertainment District remains largely a sea of blight. Club Space, the Goldrush strip joint, and another club called Exile, all south of I-395, are the only other arrivals.
Terem and his cohorts have been frustrated in their efforts to gain access to the CRA agenda. They want the CRA to back extending the Art and Entertainment District north to Fourteenth Street and south to Seventh Street. Not only would that allow their dream cafés and lounges to operate round the clock, but it would also free them from tens of thousands of dollars in water and sewer impact fees per building. Owners of Club Space, Goldrush, and Exile have enjoyed that treatment. Adding to their angst, the new pioneers are paying property taxes ranging from $15,000 to $200,000 a year for their abandoned buildings, money that funds the CRA.
So in April five of them outlined their concerns in a letter to Commissioner Winton. The current Art and Entertainment District boundaries "randomly exclude some of the most attractive areas for nightclubs and restaurants," they complained. They repeated their cry for the creation of parking lots under I-395. And greater police presence, which is also part of the CRA mission. "Potential residents [and patrons]," they wrote, "are scared away by the armies of drug dealers, prostitutes, and criminals, particularly at night around the [old] bus station and the I-395 overpass." They also requested stepped-up enforcement against owners of derelict or abandoned properties with broken windows, peeling paint, and unmowed lots. "Every time we show a prospective tenant that area it looks so shitty," one of the five, Brad Knoefler, grumbles.
"I called Commissioner Teele's [CRA office] about ten times," Knoefler says. "After about two weeks I gave up."
The tardy 2000 audit served, if nothing else, to empower Winton and Sanchez to start regularly questioning expenditures proposed by the CRA chairman and the agency's staff. But by the end of the July 9 CRA board meeting, Teele appeared to be making headway out of his crisis. He was willing to entertain Commissioner Angel Gonzalez's conspiratorial suggestion that, perhaps, it was a conflict of interest for the Miami Commission to double as the CRA board. Maybe it should include people from the private sector, Gonzalez thought.
"I'm open to all of these things," Teele declared. "The only thing I'm not open to is reversing the commitment to try to restore Overtown and to a lesser extent but to a very real extent Park West, to some sense of financial prosperity."
But he didn't stop there. Teele had come armed with a resolution ingeniously crafted to allow all branches of city government to share in the CRA debacle. It instructed Mayor Manny Diaz and City Manager Carlos Gimenez to form a team of experts that would review the CRA's finances, accounting methods, and staff structure and then make recommendations. The measure passed 5-0. A new bureaucratic process was born to ameliorate another dysfunctional, bureaucratic process. Thanks to Teele and his fellow commissioners, Diaz and Gimenez would be in this together.
As CRA board members who had only recently rebelled, Winton and Sanchez had little choice but to strike a harmonious chord. With Teele's "creative, chairman-of-the-board vision," Winton offered, "I think we can do wonders."
At the July 29 CRA meeting, however, held in the stuffy VIP Room on the ground floor of the old Miami Arena, there was more bad news. Details of a new tardy audit, from Fiscal Year 2001, were finally released. The CRA was not in a financial emergency, KPMG concluded, but it had exceeded its budget by at least $300,000, a violation of city law. Again the auditors noted an "absence of qualified staff" in the agency's finance department. And the CRA did not have a proper system in place to document each expenditure for goods and services.
Teele played it cool, listening patiently as Winton and Sanchez grilled CRA staff to their hearts' content. They had qualms about a vague request to approve a $1.4 million bid by an asphalt company for a CRA project dubbed the Ninth Street Mall Extension. Annoyed, Winton and Sanchez told the CRA director of construction management David Hernandez to come back with an itemized budget detailing specific costs. The commissioners tabled a proposal to pay a Memphis lobbying firm up to $78,000 to create a Beale Street-style tourist strip between Tenth and Eleventh streets.
After the meeting, Teele distanced himself from the problems the audits uncovered. "The one thing I don't assert is insight over the finances," he warned. "The budget, yes. The finances no. And I've always said I'm not going to deal with the finances of the agency." But he was confident that, although the auditor found certain records unavailable, none were actually missing. He added, "I specifically ask and we have always asked, 'Are there any matters relating to fraud or mismanagement that we need to be aware of?' And the answer has always been no." For her part, Annette Lewis says she inherited many of the problems and has already taken steps to correct them.
Teele prefers to talk about the future. After two years of apparent indifference toward Terem and his alliance of investor-bohemians north of the overpass, the CRA chairman is now jazzed about their efforts. "As biologists say, life will find a way," Teele had joked during the meeting. "Fourteenth Street is going to be the hot street the way this is going to develop."
"A new wind is blowing through the CRA," Terem gleefully pronounced outside the old arena after the meeting.
But when would it finally blow through one of the most godforsaken zones in all of Miami? Very soon, Teele insists. "The important thing is that we're not going to be Santa Claus to Overtown," he cautioned. "The main thing we're doing is we're spending money for capital projects. And that's what had to happen in Overtown. As corny as it may sound, you build it, they will come. If you put the infrastructure in there, the right lighting, the right sidewalks, the parking amenities, the right landscaping. And you see? The Dairy Queen guys are here now."