On a steamy June evening, as the sun set on acres of avocado trees surrounding Tomas Mestre's $1.8 million hacienda-style home, the outdoor patio swelled with well-heeled visitors. In this rural section of South Miami-Dade known as the Redland, they mingled by the tiled pool, nibbled on paella, and listened to the band while uniformed waiters offered chilled cocktails to stave off the heat. Miami-Dade Mayor Alex Penelas co-hosted the soirée. Powerful lobbyists such as Rodney Barreto attended. But the real star that night was the mayor of Homestead, Steve Shiver.
Mestre was hosting the June 10 party as a fundraiser for Shiver's November election. Shiver estimates he raised about $25,000 that night, nearly $10,000 more than he raised during his entire 1997 election campaign. Obviously this small-city mayor, who works days as a real estate agent, latched on to the right kind of friends to help his political career. But at what price?
Even as Mestre toasted Shiver's future success, one of Mestre's companies was poised to win part of a lucrative city contract, pending a vote by the city council, including the mayor. The company, Resource Reclamation Services, Inc., (RRS) is a subcontractor in ATC Associates, Inc.'s bid to clean up and develop the site of an old landfill. The estimated three-million to five-million-dollar clean-up phase of the project would rely on state and federal grants, and would cost city residents nothing.
"I did not attend the party," says Eddie Berrones, a first-term city councilman. "At that point I knew we were in contract negotiations with ATC. To me it didn't seem ethical."
Councilman Steve Bateman, who concedes he is considering running for mayor against Shiver, is less circumspect. "It stinks," he blurts. "I think the mayor made a very bad decision."
Shiver denies there was any conflict of interest in having the fundraiser at Mestre's house before voting on the contract. The City Attorney's Office agrees with him. "It's absolutely a joke," Shiver says about the criticism. "I'm astounded at some of the politics being played here." Shiver emphasizes that Mestre's company is a subcontractor with "a fraction of the business" in the project. He adds that he paid for the food and booze, and Mestre only allowed his house to be the site of the party. The trucking magnate himself did not contribute to the campaign, nor did anyone from Mestre's company. That would be a conflict. Which begs the question: If they were concerned about the appearance of impropriety, why have the event at Mestre's at all?
The answer of course is money. Shiver needs it to stay in office. Mestre has access to it through his connections to lawyers, lobbyists, and business people in Miami. Meanwhile Mestre's motivations are less clear. He referred most questions to his spokeswoman Joanna Wragg, who dismissed the notion her boss was trying to influence the public's business. Wragg says someone from Penelas's camp asked to use Mestre's house for the event because it was big and nearby. Plus her boss is civic-minded, she says, and politics is only one of his many community activities: He's hosted fundraisers at the house for the Boys and Girls Club, the Dade Community Foundation, and the Miami Symphony Orchestra.
The dump clean-up deal is not the only dirt-related business dominating Homestead politics this election year. And, again, Shiver and his political pals are in the thick of it. To the east of the old dump, the city's attempt to dig a lake on its own swampy property has ignited not only a contentious lawsuit, but a petition drive that will mean a referendum on blasting within the coming months. Spearheading these attacks on the city is fill provider Florida Rock & Sand, whose president contends that the lake-excavation deal breaks the city's own rules for fair competition and squeezes him out of several lucrative city jobs. The recipient of the lake deal? The Redland Co., which is not only one of Shiver's major campaign donors but, like Mestre, also a member of team ATC.
The 33-year-old Roy Stephen Shiver was born and bred into South Miami-Dade's folksy political establishment. He is the son of R.S. Shiver, a fixture on the city commission of Florida City for three decades. The son showed his political pedigree early on: In 1984 classmates picked him as Homestead High School's student council president.
Since first being elected to the Homestead city council in 1993, Shiver has garnered a reputation as a savvy businessman both in city hall and out. "I'm pro-development if it means the creation of jobs. I want what's best for this community," he says. In 1993, according to financial disclosure forms filed with the county, Shiver was a budding real estate appraiser. He listed his sole source of income as "Appraisal & Real Estate Economics Associates, Inc., real estate consultant." As assets he listed his $40,000 home plus three rental properties. By 1997, when retiring mayor Tad DeMilly anointed Shiver his successor in an uncontested election, the rising politician's business interests had expanded. Last year Shiver listed as income sources his real estate appraising company, a Century 21 franchise, and a general contracting firm. His rental properties now include four buildings and one four-unit complex on SW 148th Place.
In 1992 Hurricane Andrew ravaged Homestead, decimating businesses and sending thousands of former residents fleeing northward. As a result, the city has hungrily eyed opportunities to help it rebuild. It's no coincidence that two of the more contentious issues in town right now deal with land. It's Homestead's one abundant natural resource. And that's the draw. Whether it's space to put in a venue, like 1995's motorsports complex (which will host a NASCAR race this fall); or the raw product, like the fill the Redland Co. and Florida Rock & Sand are both after, there's plenty of money to be made. The mayor's aggressively pro-business stance dovetails with the city's needs and has connected him to South Miami-Dade's big money, and to people like Tomas Andre Mestre.
Hauling dirt is the basis of much of the Cuban-born Mestre's fortune. Although he dabbled in various business ventures, from RM Land and Cattle, which went out of business in 1988, to successful construction companies, it wasn't until Hurricane Andrew struck that Mestre came into his own. Mestre's house, still under construction, was damaged by the storm. "I am proud to say that we are one of those who stayed to rebuild. Since then, we have all worked hard to bring economic prosperity back to our community," Mestre noted in a written statement provided by Wragg.
"There was a lot of work to be done there, if you were willing to do it," says Wragg. Mestre, she adds, was willing. In 1993 he formed RRS. He hauled anything that paid well -- trash, dirt, or sewage. "We're not talking high glamour here," Wragg notes. But it paid off. Soon his fleet of trucks grew.
The key to maintaining his success lay in winning no-bid contracts from various government agencies. But taxpayers often ended up paying heavily for Mestre's services. And his company has been accused of resorting to unethical, even illegal business practices.
For instance in December 1998, Miami-Dade County settled a lawsuit against it by the Bauza Corporation, which alleged the county did not properly supervise RRS on a job site. The county agreed to pay $1.7 million, but only through its insurance carrier. Bauza is now suing the insurance company and RRS. (County officials originally hired RRS to remove debris Bauza dumped -- the county says without correct permits -- on the company's site at SW 157th Avenue and 200th Street.) Bauza officials claimed RRS "with felonious intent" stole 90,000 cubic yards of fine-grade topsoil and 15,000 cubic yards of rock from Bauza, an estimated $360,000 worth of material, while cleaning the site. RRS is still fighting the lawsuit, claiming that their logs show only debris was taken, not fill.
In 1994, when the county's Department of Solid Waste first awarded RRS the emergency no-bid contract to haul away the debris, the Fort Lauderdale Sun-Sentinel disclosed that RRS was charging $11.50 per ton, three times the going rate, then subcontracting the work to independent truckers and paying them $3.75 per ton. Taxpayers could have spent only $300,000 if the work had gone out competitively. They ended up paying $900,000. In the end, according to county officials, the Federal Emergency Management Agency reimbursed the county nine dollars per ton. The county made up the difference. Spokeswoman Wragg counters that project management, loading, insurance, and storage helped account for the markup.
This past summer the City of Miami tabled a garbage contract that involved building a costly compost center, widely seen as an inside deal meant to enrich lobbyists and connected businessmen, not city residents. The Miami Herald reported that RRS stood to earn one million dollars from the project. "It was a terrible deal for the city, in terms of cost," says City Manager Donald Warshaw, who came into office just as the contract was up for review.
Wragg says those incidents represent a tiny amount of the work RRS has handled over the years, the majority of them successful projects completed on time. "It's misleading to focus on three matters of controversy in a business that's very wide-ranging," she asserts.
Much of the work Mestre does is with government agencies. Not coincidentally, Mestre continues to push his political influence. He's thrown fundraisers not only for Shiver but also Miami-Dade County Mayor Alex Penelas. Such proximity has left Shiver vulnerable to criticism that he is putting the interests of businesses ahead of those of his constituents.
In late April 1998 lawyer Oscar Rivero first approached Homestead officials with a proposal. His client, the Miami office of world-wide engineering firm Parsons Engineering Science, offered to clean up a contaminated dump across the street from the city's high school on SE Twelfth Avenue, then build a park on top of it -- at no cost to the city. The firm would be paid from federal and state grant money. The city just needed to give its approval.
"It was our idea, we brought it to them," says Rivero. "Everybody we talked to loved it."
(While no other companies made formal proposals to the city, ATC officials say they reviewed the site as a possible project as far back as 1997.)
Because the project would not cost the city a cent, and because it was Parsons's idea, Rivero wrote a May 11, 1998, letter to the city manager asking if the project could be awarded to them exclusively and not sent out for competitive proposals. City Manager Charles Baldwin says that, while the city charter allows him to waive competitive bidding in extreme situations, he didn't want to take any chances. The project would be advertised. "We said, 'Fine, if that's the law, that's the law,'" Rivero recalls. "We were pretty confident. [Redeveloping landfills] is what this company does."
A December 22 deadline for proposals was advertised. But on that day, the deadline was extended to January 19. Rivero says that made him suspicious. Baldwin counters he extended the schedule as a courtesy to applicants because the original date was so close to the holidays.
Councilman Bateman is also wary. "There are unanswered questions: Why did we extend the deadline? Was ATC in the bid process prior to the extension?"
Eventually five companies submitted bids, including ATC Associates, Inc. The first of six subcontractors listed by ATC is Mestre's Resource Reclamation Services. RRS would haul contaminated fill from the site, and replace it with fresh fill. ATC regional vice president Mark Lynch says he chose RRS because he had worked with them in the past, not because Mestre was seen as politically influential. "I selected RRS because they deliver timely and quality services," Lynch says.
The city appointed a committee of four city employees and one noncity employee to review the proposals. The committee assigned scores, up to 25 points, to each firm, based on criteria such as "Landfill Redevelopment Experience," and "Quality/Quantity of Success for Similar Situations." In the end, ATC won. Two committee members gave Parsons 15 points for experience, and ATC 20 and 25 points. Assistant city manager and former police chief Curtis Ivy, Jr., initially gave Parsons 25 points for experience, then crossed it out and gave the firm a 20. He gave ATC 25 points. In fact Ivy gave that company a perfect score of 100. Michael Tavano, the city's director of public works, gave ATC an 86, and Parsons a 68 overall. "[ATC] had a lot of relationships with state agencies, like the DEP and DERM," Tavano says. "A lot of Parsons's experience was out-of-state."
The only committee member to rank Parsons higher than ATC was Edward Swakon. He was also the only noncity employee and the only engineer. Swakon could not be reached for comment.
ATC's Lynch says the team he assembled for the project, from local construction company Redland to powerhouse developers Terremark, helped win the confidence of the committee. Lynch also points out that his proposal emphasizes the possibility of commercial development on the site, such as stores. Conversely Parsons's development partner, Florida Environmental Developers, was a firm organized solely for the dump project.
But Parsons's lawyer Rivero counters that according to the proposal, ATC simply doesn't have the experience his firm has in closing and developing dumps. Parsons was the lead engineering firm in the closure of the Old South Dade Landfill, taking on a $15 million chunk of the $30 million project. ATC's contracts are far smaller. For instance in the first completed project it lists as a reference, the former Ojus Landfill, ATC was paid $1.4 million out of a $20 million contract. (Lynch responds that the majority of that contract was for construction of a school.)
As for developing commercial space on the dump site, Rivero says his team is open to that as well. But until the soil is tested, he says, no one can say with certainty that buildings will be allowed.
Once the committee ranked ATC on top, Baldwin started negotiations. He first asked for a more detailed plan. According to Baldwin, vague wording on the new set of documents left open the possibility the city would have to fund some of the project. Without going into detail Baldwin says, "I had questions about their initial proposal. I demanded there be clarity [on cost]." Lynch says he has since allayed those fears. "[The proposal] wasn't clear. Charlie Baldwin asked some tough questions. Let me be emphatic, this project will not ask the City of Homestead to pay one penny for the closure or redevelopment of the landfill."
When negotiations are completed, the city council will vote on whether to approve the ATC proposal or not. Shiver, responding to critics, asked city attorneys to decide whether Mestre's fundraiser was a conflict of interest, and if it should prevent him from voting on the contract. On July 8 the firm of Weiss Serota Helfman Pastoriza & Guedes sent its reply: There did not appear to be a conflict of interest because the mayor did not receive direct tangible gifts. The mayor was free to vote.
"Let the red flags fly; I did not do anything improper," Shiver declares, adding that the criticism is coming from would-be political opponents and a business interest. The date of the vote has not yet been set.
There is a second act to this tale of dirt.
A mile and a half east of the dump site sits another city project, a 62-acre expanse of shallow, murky water sectioned off by earthen dikes. The millions of cubic yards of dirt and rock lying beneath this city-owned tract are the key to completing two other nearby public jobs. The city wants to turn the marsh into a lake, then use the extracted dirt to fill a proposed industrial park, and to create additional parking for the Homestead Motorsports Complex.
Early this year the city contracted with one firm to dig the lake and remove the fill -- without opening the projects to public bid. The firm, the Redland Co., is a major campaign fundraiser for Steve Shiver, and also happens to be a subcontractor on the ATC dump bid.
In 1993, when Homestead was struggling to recover from Hurricane Andrew, the city teamed up with H. Wayne Huizenga and Ralph Sanchez to build a world-class motorsports stadium. As with all other new development in South Miami-Dade, the deal hinged upon empty wetland, and the dirt, gravel, and crushed lime-rock needed to fill it. A crucial part of the racetrack deal, which also created the Park of Commerce, was a swap between the city and developer Florida Design Communities (FDC). The firm offered land for the Homestead Motorsports Complex and the Park of Commerce. In return the city would either pay FDC $1.4 million in cash or give the company an equivalent amount of fill by December 30, 1998. As the deadline approached, it was clear the city did not have the money to pay FDC.
Meanwhile FDC continued to develop its residential subdivisions in the city. In one of them FDC contracted with The Redland Co. to excavate a six-acre lake and use the extracted dirt for fill. In July the city ordered Redland to stop, arguing it was an illegal quarry. FDC promptly sued the city.
As 1998 drew to a close, FDC had the city over a couple of barrels: the six-acre lake lawsuit and the $1.4 million debt. The city needed to "shit or get off the pot, if you'll pardon my French," says councilman Steve Bateman.
Also, two more crucial deadlines were fast approaching. First, the city had promised a developer affordable fill as an enticement to develop the Park of Commerce, a 270-acre wedge of city-owned, industrially zoned land just west of the racetrack. Second, the city needed to provide an additional overflow parking lot for the upcoming Winston Cup Jiffy Lube 400 NASCAR race, scheduled for November 12-14 at the racetrack.
City Manager Baldwin says he and his staff figured out a plan that addressed all of those needs. The city owned four tracts of wetland south of the motorsports complex. Baldwin theorized that the city could change the zoning, use two tracts for overflow parking, and dig a lake in another to provide fill. That fill also could be used for the park and to pay off FDC.
The mayor, for one, loved the plan. "Unfortunately, we'd been dealt a significant financial burden [in the $1.4 million obligation to FDC], but I think [the 62-acre lake proposal] was the most efficient resolution that we could do," Shiver says. Baldwin calls the deal "a no-brainer."
As the City of Homestead proceeded to get state and county approval to dig the lake, South Miami-Dade's biggest provider of fill was looking over the city's shoulder. Steve Torcise, Jr., president of Florida Rock & Sand, scheduled a meeting with Baldwin in November of this past year. "He wanted to know what was happening relative to our lake," Baldwin remembers. "He came in to visit, and I explained the whole thing to him." Baldwin says he described the process to Torcise, noting that the last significant step, a blasting permit from the Miami-Dade County Commission, was set for the commission's December 15 agenda.
In retrospect, Baldwin allows, he wishes he'd kept his fool mouth shut about that commission meeting. There, into the wee hours of the morning, Florida Rock's lawyers lobbied long and hard to delay the issuing of the blasting permit. The landfill firm opposed the lake project because it could become a possible city-owned source of fill to compete with the firm's own quarry four miles south of Florida City.
Florida Rock succeeded; the commission deferred a final vote until January 21. That was beyond the December 30 deadline by which the city had to pay off FDC. If the city couldn't blast, the city couldn't give FDC the fill. They'd have to give FDC the $1.4 million in cash -- which Baldwin maintains was $1.4 million the city didn't have.
Then, as Baldwin tells it, a white knight appeared in the form of Charles Pinkney "Pinky" Munz, president of the Redland Co. that had been digging the small lake for FDC nearby (the excavation the city had stopped, prompting the FDC lawsuit). Thus, Munz was intimately familiar with the city's entanglements with FDC. He also has been a big supporter of Shiver's political career, contributing $2000 to Shiver's 1997 campaign through his corporations and family members. Baldwin remembers: "Pinky Munz came in to see me and said, 'How about if I put up the $1.4 million to FDC under an agreement with you all?'"
Sounded good to the city. After receiving an extension from FDC, the city council on January 19 voted to accept Munz's payment of their debt to FDC. In exchange Munz would be paid to excavate the lake and carry out the rest of the city's plan to provide fill for the Park of Commerce and the overflow parking for the racetrack. He'd also get to keep half of the fill.
On January 20 the city and FDC settled the small-lake lawsuit. This settlement clearly was connected to the big-lake deal. In a closed city council meeting on January 4 attorney Joseph Serota describes how he and Baldwin came up with a plan to "resolve both the [$1.4 million obligation to FDC], and by doing that, we would resolve the pending litigation." Under the terms of that settlement, Redland would be allowed to finish digging the six-acre lake. Suddenly, the small lake that the city had called a quarry was no longer a quarry -- and neither was the even bigger lake half a mile south.
"I wanted to help the city, but it was also a business opportunity," Munz says. "It's a good deal for us."
It's also a crappy deal for Florida Rock & Sand -- or Rinker, White Rock Industries, Miami Crushed Rock, or any other Miami-Dade County fill provider that might have wanted to bid on the work. Steve Torcise points out one ironic detail from his November meeting with Baldwin. "My recollection is very clear: Charles Baldwin specifically told me that any business arrangement between the city and a private contractor would have to go to competitive bidding." And yet, with a couple of strokes of the pen, the city had removed two of its plum public-works projects from the possibility of competitive bidding, and bestowed them upon Shiver's pal Pinky.
Incensed, Torcise filed suit in Miami-Dade County Circuit Court. Attorney John Shubin, representing Florida Rock & Sand in this litigation, put forth two major theories. First, that the city had improperly created a commercial quarry on residentially zoned land. Second, that the city had violated its own rules for competitive bidding.
"The city has made several bad business decisions over the past few years," Torcise asserts, "and they continue to invent extraordinary and unconventional measures to avoid paying for the fill they borrowed for the racetrack. Unfortunately, those measures have come at the expense, not only of Florida Rock & Sand, but the rest of the firms [who could have bid on the jobs], and at the expense of good government. We believe the actions of the city have been illegal."
Pinky Munz has another theory. "The biggest thing the public needs to know is that this is nothing more than a competitor trying to monopolize fill operations in South Dade," Munz says. "If [Torcise] can monopolize fill, he can control pricing. It's really more against me than against the city."
Though the contract with Redland passed the city council unanimously, Steve Bateman is having second thoughts. "I still think that using our own natural resources in this way was smart and savvy," Bateman says. "Where I draw the line is, did we need to do this as an emergency measure, handpicking someone who happened to write us a $1.4 million check?"
Bateman doesn't blame Munz for the current mess. "I blame us, the policy setters and enforcers," he says. "The common thread, once again, is not following our charter. No one is asking the simple questions here. If we had, we would have spent a lot less in attorneys' fees, fighting what Florida Rock & Sand feels is unethical."
Serota, Baldwin, and Shiver all point out that the city charter allows the council to waive competitive bidding when it is in the best interest of the city. The city council unanimously agreed with Baldwin and Shiver's assessment of the Redland deal -- getting Munz to pay the $1.4 million and giving him exclusive rights to dig the lake were in the city's best interest. The council waived competitive bidding on the project on May 3.
The city council agreed Monday to pay Redland $4.5 million over three years to excavate 2.1 million cubic yards of the city's fill. Work is already under way; Munz says Redland has done some de-mucking, blasting, and excavation on the site. The result: a swath of square, turbid pools. Two huge dredging cranes, as well as assorted heavy dump trucks and pickup trucks, often are parked on the site. In a June letter to Baldwin, councilman Bateman complained about the work and the equipment on the site: "If there is no contract in place, who does the equipment belong to and why is it there?" he wrote. "If this equipment belongs to Redland construction, it does not look good for the Council or you, sir."
On June 25 a circuit court judge dismissed Florida Rock & Sand's seven-count complaint -- four counts were dismissed "with prejudice," meaning the plaintiff could not refile, three dismissed "without prejudice." Shubin says he's going to refile all seven anyway, based upon the "ripeness" of the charges.
But by now, the city has something else to worry about: a successful petition drive, conducted by Florida Rock, that will require a referendum on the issue of blasting, as well as competitive bidding on city-owned excavations. The public vote must take place by February 2000.
The campaign, filed by a newly formed political action committee called BLAST Homestead, was totally funded by Florida Rock & Sand. "We felt that a charter amendment was the most efficient way to put the power back in the people's hands," says Torcise.
Shiver believes that the grassroots claim is a stretch. "I think you can see a pattern here of what seems to be a disgruntled company wanting us to legislate market conditions," Shiver grouses.
He adds that the vagueness of the ballot language scares him. "It reads that any excavation on city-owned property has to go to public vote," he says. "As I understand it, that can mean turning over a mound of dirt for re-landscaping. That would effectively strangle this community."
"I don't consider [landscaping] to be excavation," Shubin replies dryly. "I assume their public works department doesn't need to use explosives to plant a tree."
Meanwhile, Pinky Munz's position, relative to both the lake deal and the dump deal, looks pretty darn good. If front-runner ATC gets approval for its dump bid (as looks likely), Pinky gets the job. With the lake, the project didn't go out to bid, and Pinky got the job. But he stresses that the fill he stands to excavate from the lake is a "drop in the bucket" compared with Torcise's operation, which includes not only the vast quarry on Card Sound Road but a soon-to-be dug 200-acre lake scarcely two miles south of the city's 62-acre site.
Munz scoffs at the suggestion that his monetary contributions to Shiver's campaigns have in any way greased the skids for him, or for fellow Shiver-backer Tomas Mestre. "That's a crock," he says flatly. Redland also gave $400 to Steve Bateman's 1995 campaign; Florida Rock & Sand has contributed to numerous city council members' campaigns over the years, including $250 to Bateman in 1995.
"We're on ATC's team, but we're not a part of the negotiations with the city," Munz says. "We just jumped on their team because they needed a site contractor." He adds that it hadn't even crossed his mind to use fill from the 62-acre lake on the dump project. "[The dump] is already high; I'm not so sure they'll even need fill," he says. "There's no connection."
Bateman thinks the dump-capping and the lake-excavation projects are close enough to stink. "If I find out Redland is going to be doing trucking and fill work [for ATC], I'm even more angry, because it looks like there's a network here," Bateman says. "Pinky Munz is sitting on a giant, unshined diamond, and I don't mind that, provided he received it fairly."
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