Miami Beach Will Write Off $13 Million in Fees Owed by SoBe Hotels and Restaurants

SoHo Beach House: $460,000. Prime Italian restaurant: $280,000. Blockbuster video: $25,000.

It reads like a bill for a raging Art Basel party. In fact, it's just a few of the fees that local businesses owe the City of Miami Beach.

Because of billing mistakes and lax enforcement, however, officials now say the are going to forgive the more than $13 million, essentially giving developers and business owners a huge holiday bonus. So to save some sense of accountability, New Times is publishing the full list of outstanding fines.

See also: Miami Beach Fire Department Is Aflame With Corruption and Abuse

The fees first became public back in September, when the city unveiled the results of an eight-month audit of its "fee in lieu of parking" program. Under the program, developers are supposed to pay for each legally required parking space they don't provide.

But the city's review found that over the past 20 years, crappy record-keeping had left roughly $19 million uncollected. Commissioners suddenly had to figure out how to fix a two-decade-old disaster.

Commissioner Jonah Wolfson recently told the Miami Herald that he thought charging the businesses the full amount of the fees would be unfair.

"I don't think we should be enforcing parking impact fees on a small business in such a way that's going to put someone out of business," he said.

Instead, the city came up with a plan to collect only the fees incurred during the past five years. All older fees were considered outside the statute of limitations.

Yesterday, the true cost of the city's financial f*ckup became fully apparent.

According to documents presented during a Finance & Citywide Projects Committee hearing, Miami Beach is writing off $13,367,566 in money it should have collected -- mostly from mega developers of swanky SoBe hotels.

A full list of outstanding fees is provided below, but here are a few of the highlights:

Cheese Burger South Beach was supposed to pay a one-time $1.26 million fee in lieu of parking. Instead, the restaurant paid nothing but because it opened in 2008 and is now closed, it's off the hook.

Many of the biggest fees are owed by Ocean Drive or Collins Avenue hotels because they were built with or expanded to include many rooms but little parking. All of these fines are being written off:

  • Edgewater Hotel $950,000
  • Fairwind Hotel $800,000
  • Apple Hotel $720,000
  • Shoreclub Hotel $585,000
  • SoHo Beach House $460,000
  • Victor Hotel $430,000

Other big fees owed include:

  • Portofino Office Tower $225,000
  • Blue & Green Diamond Condos $280,000

In some of these cases, the city "incorrectly calculated" one-time fees, leaving businesses to believe that they were squared up. In others, the city simply never collected the fees at all.

Not all of the outstanding fees belong to swanky hotels or condos, however. Gold's Gym on the corner of 14th Street and Alton was supposed to pay another $217,650 in yearly fees. 8oz Burger at 11th and Alton still owes $39,200. Blockbuster bailed on $25,000. All three businesses are now closed.

The fee forgiveness is frustrating for locals for two reasons. First, we're talking about more than $13 million that the city should have to spend on its citizens. If, in the future, the city needs funds, that money will come from taxpayers instead of mega developers who (intentionally or not) underpaid in the past.

Second, this issue is clearly connected to parking on the island. For anyone who has encircled Miami Beach for hours looking for a spot, you have these businesses -- and this failed program -- to thank.

Miami Beach - Fee in Lieu of Parking Program

[H/T Frank Del Vecchio]

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Michael E. Miller was a staff writer at Miami New Times for five years. His work for New Times won many national awards, including back-to-back-to-back Sigma Delta Chi medallions. He now covers local enterprise for the Washington Post.