MIAMI MIRROR TRUE REFLECTIONS

OFFICIAL DISCRETION IN MIAMI BEACH

Residents beg new City Manager Jimmy Morales for relief from Indiscretion

April 23, 2013 By David Arthur Walters We have received a statement from David Weston, a Miami Beach fire inspector who was allegedly fired for complaining about millions of dollars of missing monies in permit fees, that he has reviewed the article entitled Getting Ahead of the Job at the Icon, published in the Miami SunPost and elsewhere. This was a project that I was working for during the original construction phase, Weston said. You are certainly right about construction in that building. For that article we had examined information appertaining to the staging for sale of condominium Suite 1801 at the ICON at 450 Alton Road in South Beach, and asserted that it
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presented a perfect example of how a developer can buy a South Beach condominium and have an unlicensed general contractor stage it for sale without obtaining a permit for construction, and make a small fortune. The Icon unit was purchased on Dec. 15, 2010 and sold June 13, 2011 for an estimated net profit of $1,263,000. We understand that is now in the process of being flipped again for a hefty profit. Evidence of the non-permitted work was delivered to city officials including Building Department Director, Stephen Scott, Building Department Operations Manager Antonio Gonzalez, Commissioner Ed Tobin, and Quality Assurance Coordinator Linda Blanco, an expert with twenty years of experience hired in March 2012 after the latest Building Department scandal. While realtors were bragging that the ICON was nearly fully occupied, we counted around 150 flooring permits, and only 50 permits for the renovations that most wealthy people and savvy real estate flippers would desire. We left it to competent statisticians to estimate the extent of non-permitted renovations among the units that bothered to pull flooring permits. We estimated that the City of Miami Beach lost up to $1,000,000 in potential permit fees on that tower alone, some of which could be secured if the building were professionally audited. Extrapolate that among the total new condominium units in Miami Beach and the total loss might approach $50,000,000. Without a thorough audit of all construction through the beach, an impossible task, we have no way of knowing how many millions have been lost in permit fees. We suggested that, in the future, all write-offs of fees and fines, and the like, be accounted for and reported as a generally accepted accounting procedure because of the material impact on city finances. But City Attorney Smith determined our proposal to be moronic. As Icon 1801, we contacted Director Scott on February 21, 2013: Dear Mr. Scott. I am following up on our previous correspondence regarding Icon 1801, some of which I attach for your ready reference. You may recall that documents were turned over to the Building Department that indicate work had been performed in that unit without a permit, and that the owner-developer happened to be involved in other projects that appeared to be undervalued and/or non-permitted. Please advise what steps the Building Department took to require a permit and how much it collected in fees. I am also attaching a copy of the penalty provisions from Sec. 553 and Sec. 775.082 and 775. 083 Fl. Stat. According to that 2011 version of the statutes, violation of the state building code can result in the imposition of a $500 fine and up to 60 days imprisonment. Since I am not an attorney, and the law is so complicated that it is difficult if not impossible for laymen to understand it, I cannot say whether or not it applies to developers, owners, contractors, and expeditors who either alone or in concert knowingly fail to obtain permits for construction. If it does, my limited experience with the City of Miami Beach and the City of Miami leads me to believe that it does not apply to offenses within those cities, or is simply not enforced. Since you have legal training and are an industry expert, I pray that you will let me know if it does apply to our city, and, if so, whether or not the Building Department reports violations to the Police
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MIAMI MIRROR TRUE REFLECTIONS

Department, I shall also check with the Police Department of Miami Beach and the Attorney General of Florida on the issue to see what they might say on the subject for my formal report to the public. As you probably know, there is some controversy raging over allegedly tens of millions of dollars lost in permit fees due to undervaluation and non-permitted work. Undervaluation permitted by officials may not be prosecuted as corrupt activity because those officials can excuse what amounts to discounts by claiming the reductions are within their discretion as allowed by the city manager, or so it is alleged. It would appear that non-permitted work is another matter, and that, if it were a crime, and enforced and prosecuted as such albeit a misdemeanor, it might curb an abuse that I understand is widespread; just as, for example, a recent crackdown by the police on panhandling, resulting in an increase of arrests from a handful within a year to over a hundred, virtually cleared the streets of habitual offenders when the word got around. Mr. Scott has not responded to that communication at press time. While it may appear to people unacquainted with the enforcement of laws that everyone involved should be held accountable, that conspirators involved in depriving the city of fees and the public of safety should be charged, that the finances and holdings of city officials should be investigated by forensic accounts, and that officials should be fired for widespread negligence or not reelected. However, it appears that everything done off the books is legal in this area, with the sanction of public officials, who are themselves rendered immune from liability due to their sovereign discretion. Indeed, we frequently see the t erm, discretion voiced by officials who would like to have their responsibility waived for not exercising the police power to ensure the welfare of the people. We know from our history lessons that discretion was synonymous with tyranny under kings who should not do wrong but did so with impunity until they were violently deposed, yet now every official would be king. During our investigation of the matter, we frequently heard the statement, Everybody does it, and everybody knows it. But fired fire inspector Weston did not believe everyone should do it. It seemed criminal to him, so he went to law enforcement officials, only to discover that officials apparently have enough discretion to get away with it. My original reporting of the fee matters was to Miami Beach Detective Rosa Redruello and Florida Department of Law Enforcement Agent Gaylon White. I worked with closely with Rosa up until her semi-retirement. During the last of her full time days, Rosa confided that Building and Fire officials have the authority to lower permit fees as an incentive to developers. I never believed this statement to be the case. Live and learn about the extent of discretion. Detectives and prosecutors have quite a lot of it. But keep in mind that judges and juries have a lot more of it before you go blaming them. The
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bottom line is the morality and customs of people at large, the little kings and queens who may stand by intimidated while those on the top floors legalize immorality for themselves. Weston found cause to hope: The brand new city manager, Jimmy Morales, appointed to replace the entrenched administration of involuntarily retired Jorge Gonzalez, has apparently begun a shakeup. Morales, a politician and a lawyer, is well regarded by most people, the people who were virtually ignored by the previous regime. He looks more like an elected strong mayor or even a governor than a city manager appointed by a part-time commission. His credentials are so impressive that people with high expectations have dubbed him Supermanager. We shall see.
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