MIAMI MIRROR TRUE REFLECTIONS

The fraudulent permit was to demolish non-existent kitchen and bathroom in completely blank Sunset Harbour penthouse

ROBBING PETER TO PAY PAUL IN MIAMI BEACH

Nothing under the Sun is new, neither is any man able to say:
Behold, this is new: for it hath already gone before, in the ages that
were before us. Ecclesiastes 1:10

March 30, 2015

By David Arthur Walters
MIAMI MIRROR
City of Miami Beach taxpayers whose attention has been diverted to the convention center
political football and the eventual submergence of the city by rising tides due to climate change
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should know that their inexperienced new city manager, Jimmy Morales, Esq., despite good
deeds vaunted and hailed, does not abide by the ordinances made by the city commission
when it comes to charging and collecting building permit fees, and that city commissioners who
have been alerted to that fact could care less because their main interest is not in the general
welfare of the public but in campaign funding and their own aggrandizement. Not that
selfishness is a bad thing, as Bernard Mandeville pointed out in the Fable of the Bees.

Sunset Harbour towers in background facing developers Philip Levine & Scott Robins retail center under the city garage

The new mayor, Philip Levine, tries to often repeat the mantra, We love our city. He abhors
negative criticism and seems to be a sort of numbskull. Do not be fooled. He is shrewd enough
to know that the progress of the city as well as civilization depends on negative criticism, and
that those who love it the most will take him and the management to task.
He also likes to say that the city works for its people. Yet the city management, like the
multimillion dollar WIFI system, only works for a few people depending on their position. A
mere six-thousand votes will get a wealthy man elected to the lowly paid mayors seat. The
electorate is not apathetic, as one might assume with such low turnout. It is sun-dazed. Millions
have to be spent on negative criticism of the ruling regime to whip it into making a change at
the polls.

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Indeed, negative criticism of the past manager and mayor is why the city has a new manager
and mayor. He purchased a majority of commission seats, so he acts like a strong mayor in a
city that has a weak mayor, strong city manager charter. His problem is that the city installed
Jimmy Morales before he was elected, and the electorates problem is that getting rid of this
faux strong mayor will not get rid of the strong city manager, Jimmy Morales, the political
insider and good old local boy who was shoed in to the position although not even named by
the recruitment firm hired to recommend and vet candidates.
Morales, in response to my concerns about corruption in respect to the collection of building
permit fees, referred me to Joe Jimenez, Esq., who oversees the citys building department,
code compliance department, and ethics, which does not have a department.
Jimenez was his henchman to Morales when Morales was the city attorney for the City of Doral
and he assistant city attorney. They were two of several Doral officials who abandoned that
version of the mythical Ship of Fools for the City of Miami Beach, which itself was veering crazily
off the course to paradise. Wealthy cruise ship publicist Philip Levine was then recruited by the
rotating opposition to purchase a commission majority and figurehead the salvage operation
for rent-seeking cronyism.
Mariano Fernandez, whom Morales imported from the troubled City of Miami building
department immediately after he was appointed city manager, had already stonewalled me on
the issue of permit fee collections. Jimenez said that his opinions in the matter could not be
attributed to Morales. Yet Morales absolutely deferred to Jimenez without a word.
When Morales wants troubling information dismissed, Jimenez serves as his troubleshooting
defense lawyer. He has gained a reputation for being a hardworking man with a dismissive
attitude. One may sympathize with him given the crap his boss puts him up to. Anyway, both of
these members of the Florida Bar, if they are excellent lawyers, must be commended for their
public-spirited charity for not going back to the law firms on their resumes instead of working
as city employees.
The previous city administration was scandalized by the allegations of fired fire inspector David
Weston, to the effect that millions of dollars in permit fees were not being collected by the
building department because owners were understating the construction costs on which permit
fees were calculated. I happened to have independent information indicating that values were
habitually understated on building permit applications.
Weston said he was fired for blowing the whistle. Morales, shortly after taking office, promised
me that he would not brush that subject under the rug. And that is just what he did, using the
human resources department to that end.
I persisted with the undervaluation issue, particularly in respect to a Sunset Harbour penthouse
where the contractor on behalf of the owner, a developer who had signed blank permit
applications forms, had proceeded to build out the completely empty space after obtaining a
permit to partially demolish a nonexistent bathroom and kitchen that appeared on old plans for
a full buildout that had never actually come to fruition. The fee was $947 for a declared
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construction value of $6,000. So I suspected that the plan was to do a million dollar buildout as
if it were just a kitchen and bathroom renovation, cheating the city out of about $30,000 of
regular fees.
Building department officials ignored my pleas until Jorge Gonzalez, city manager, provoked
building officials into inspecting the site. Around $400,000 of construction had already been
completed. The total signed contract, a copy of which was leaked to the building department
and its building official, was for $997,453.40 before add-ons.
A stop work order was issued. Another blank permit application was filled out and filed, with a
total construction value of only $400,000, upon which the regular permit fee was charged
despite the fact that a copy of the actual construction contract had been delivered to the
building official. I insisted that a double permit fee be charged as required by code, the double
amount being a fine for starting construction without a permit. I followed up on the issue
because, although I was told by building officials that the fine was never waived, contractors
said that it was sometimes waived and nobody knew the difference. The motto stated by an
unlicensed contractor who rented license numbers for permitting purposes was, Everybody
does it, everybody knows it, nobody cares.
The building department finally charged the double-the-fee fine, changing the permit fee from
$24,532 to $46,945. Do not worry about the owner: he would eventually deduct around
$75,000 in late completion fees from the unlicensed, de facto general contractors billings,
perhaps knowing that the contractor would not get any balance at all if the whole scheme were
exposed in court.
Efforts were soon made by city officials to obtain authorization from the state building
commission to waive double permit fee fines providing that owners came forward and
confessed to doing jobs without permits before being caught red-handed. Of course the timing
of amnesty requests from owners could be manipulated for corrupt purposes. It appeared that
a bullshit waiver program was needed to cloak monkey business as usual.
As for the Sunset Harbour permit, I was informed by the building official that the cost of
construction did not matter since the city had changed its assessment method, from charging a
percentage of the construction value, to charging fees based of how many square was involved
in the construction. The new method was effective Feb. 1, 2010.
Well, that was not quite true. According to Tony Gonzalez, the operations manager of the
building department, a small percentage of the value stated on applications was still being
charged after the change to defray sanitation impact and county code compliance costs, and
the valuations were also used to trigger the application of FEMA flood requirements.
So the $600,000 difference between $400,000 stated on the permit and the $1,000,000 stated
on the invoice could result in underfunding of those programs amounting to several thousand
dollars on this permit, and, if the undervaluation process were widespread, it could amount to a
million or more dollars uncollected and distributed.

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Whistleblower Weston said he took this kind of shortage with the inspector general for the
county, pointing out that the county was affected. The inspector general, lacking resources, is
not interested, however, in investigating the events originating in the City of Miami Beach.
Wherefore I persisted with my attempts to get the city to at least calculate the correct fee if not
to collect it, to no avail, thanks to Jimenez, who beat around the bush several times, and not
only declined to demonstrate how a fee would be calculated on a hypothetical $1,000,000 for a
6,000 square foot condo buildout, but, after declaring that current permit fees are based on
construction cost valuations subject to a minimum determined by square feet, reduced the
stated value of the actual contract from $1,000,000 to $352,000.
His explanation for his reduction in value illustrates how hard bullshit works for City of Miami
Beach corruption when the administration has discretion to do anything it damn well pleases in
these crucial financial matters.
Most importantly, he noted, paraphrasing Section 554.80(7) of the Florida Building Code, It is
important to note that the Building Department is not a revenue generating department.
Permit fees are intended to cover the cost of operating the Department and should not provide
a windfall to the City. Granted, there are years when the building boom provides the City with a
surplus, which may only be used for the operation of the Department in future years when
development slows.
He denied that he meant to imply, on behalf of his boss, that fees would not have to be
collected because the build department broke even with its costs for the year.
Your conclusion that the City Manager doesnt want to collect permit fees because he doesnt
think that the Building Department is not a revenue generating department is a bit off the
mark. For one thing, the Manager never said such a thing, I did. Secondly, I never stated,
implied or hinted at not wanting to collect fees.
The city manager neither admitted nor denied that he did not want to collect the fees: he
simply stonewalled me with utter silence, relying on his troubleshooter to get rid of me. So
what about the fees?
Jimenez proceeded to deduct certain irrelevant costs merely associated with construction
from the $1,000,000 construction invoice:
Yes. The cost of construction stated to the city determines the permit fee. However, there is a
minimum construction cost per square foot. There are other costs associated with construction
that are irrelevant to the permit fee, such as the cost of a toilet. If a homeowner installs a ten
thousand dollar toilet as opposed to a five hundred dollar toilet, the level of review from the
Building Department is the same. Therefore, those types of costs are not calculated as they do
not increase the level of plans review or inspection. Consequently, it should not be a factor in
determining a permit fee. I specifically wrote to you that certain costs associated with
permits application review and inspection are irrelevant to the costs of that review and
inspection. For example, the contract you provided indicates that a certain type of flooring
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was installed in that project. That is an example of an irrelevant cost. All flooring is inspected
the same way. There are a number of other examples of irrelevant costs in this unverifiable
document, such as painting, baseboards, the costs of the closets and the TV and audio
installation. In addition to other irrelevant costs itemized in the document provided, my
calculation of irrelevant costs comes out to approximately six hundred thousand dollars. In
other words, the relevant costs of construction amount to three hundred and fifty two
thousand dollars. Consequently, the permit application was correct.
Certainly Jimenez could not be so stupid, I surmised. His mistake is in thinking other people are
stupid enough to be fooled by his bullshit, which goes even beyond bullshit into deliberate
lying.
There is no such thing as irrelevant installation costs associated with construction. Such costs
are construction costs, just as a rose is a rose is a rose. The cost of labor installing a floor is a
construction cost, just as is the material. The notion that permit fees might be charged only on
construction labor and overhead, and not materials is appealing but is not realistic or
appropriate. Take, for example, the flooring. Not only the work but the flooring material, for
example, must be permitted. The flooring line item he refers to is described on the contract as
follows:
Install stone floor throughout apartment and balconies and upper deck as per plan (material
by contractor). Install tile at all bathroom walls as per plan. Install interior soundproof
insulation throughout the exterior and waterproof on balconies as per plan. $225,000.
Should we deduct the wood, concrete, and other materials from structures when we assess
permit fees? Why not deduct the value of the copper in the electrical wires too? Should we also
deduct the installation, leaving us nothing to charge the fee on?
Jimenez had plastered the subject with la plasta de la mierda. In doing so, he gave me the
opinion that he is either incompetent, certainly incapable of overseeing the building
department, or dishonest, which might qualify him for the task as it is normally done.
That is not to say that some costs associated with construction are not assessed, and those
deductions differ from jurisdiction to jurisdiction. I pointed out to Jimenez that, in one
jurisdiction, the city expressly included, for example, all costs associated with construction of a
kitchen except the refrigerator. Of course furniture would not be included, and, furnishings had
been separately charged on the particular job I presented as an example.
Some jurisdictions, such as the University of Florida, expressly describe what is included as costs
on which permit fees are charged: The cost shall include total value of work for which the
permit is being issued, including materials and labor and all related electrical, mechanical,
plumbing equipment, gas systems, and permanent installed building systems.
I asked Jimenez for the citys similar schedule of permit fees. It did not specify what must be
included in calculating costs.

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Alas that I am a slow thinker, because it was only then that a bulb when off and it dawned on
me what he was concealing with his bullshit as an agent of the administration and commission.
They had in effect rolled back the reforms that the previous regime had made to reduce the
opportunity for corruption in the building department.
On April 16, 2008, subsequent to the arrest of several city employees, the city manager Jorge
Gonzalez described to Mayor Matti Bower and the commissioners several improvements he
had made to curb corruption. At that time permit fees were being assessed on a hybrid job
valuation/square footage basis.
AlE Affidavit for Job Value and Total Gross Square Footage: Creation of a new form, which
requires execution by the Owner/Developer, Architect and Contractor, enabling the Building
Department to verify and ensure that permit fees are assessed according to the fee ordinance
and to establish accountability, and create an audit trail for the proper collection and
assessment of permit fees. This step also requires a licensed, independent third party to certify
the estimated job value and the gross square footage, which become the basis for the building
permit fees. This procedure also creates a paper trail that can always be referred to during the
process. Previously, this information in many cases was provided by the developer or owner
and not verified.
In 2010 that method was ascertained to be too costly and complex for adequate enforcement.
The commission ordained that building fees be assessed on a square footage basis. Come to
think of it, that method presents the easiest way to check an owners statement about the work
to be performed, simply by measuring out the number of square feet. Indeed, the
misstatement of construction costs is so prevalent that the county appraiser considers
construction cost inputs from the various jurisdictions as mere estimates.
So now the affidavit swearing to construction costs would no longer be required, although the
value would still have to be stated on the permit applications. A small portion of the fees were
charged on the value and not on square footage. Further, an owner could seek relief if square
footage fees exceeded 10% of the construction costthat aspect was also dropped with the
next reform.
In 2014, the city commission, following the administrations recommendation, as it almost
always does according to Commission Michael Grieco, the mayors right hand man, reverted to
the construction cost method of assessing fees.
No affidavit of job value or audit of stated values is required. Why bother with that when Joe
Jimenez, Esq., who oversees the building and code compliance departments and the citys
ethics, is there to add and deduct from contracts whatever suits the occasion?
Needless to say, there is nothing new under the Sun, and this occasion may very well be yet
another opportunity for moral and criminal corruption. The beleaguered former city manager
believed commissioners themselves were on the take.

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All seems well as long as Peter can be robbed to pay Paul so the city can break even. Such is the
traditional Miami Beach way of doing things.
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