How a politically connected farmer overcharged Dade government for thousands of oversized palms
04/25/1996 12:05 AM
09/08/2014 5:33 PM
THE STORY: After a major sprucing up of county highways for the Summit of the Americas, residents in Dade County suburbs began clamoring for their 'share' of stately palm trees. Pressed by politicians, Metro delivered the trees, but taxpayers came up . . . well, short.
A prominent South Dade farmer, paid millions by Metro to landscape county roadways, charged taxpayers for towering royal palms while planting shorter, cheaper trees, a survey by The Herald shows.
Metro's bill payers didn't know the trees came up short. They didn't double-check invoices. They didn't send inspectors to measure the trees that were planted by Manuel Diaz Farms.
From urban North Dade to rural Homestead, thousands of trees on public roads and highways now stand as a living monument to government foul-ups that allowed county taxpayers to be shortchanged by the politically connected farmer.
The Herald discovered the problem after examining billings for trees purchased by Metro, then checking to see what Manuel Diaz Farms actually planted. A pattern emerged:
* On busy Kendall Drive, Diaz billed the county for 430 royal palms that are supposed to be 28 to 30 feet tall. Typical actual size: 22 to 24 feet.
* On Avocado Drive and nearby streets in Homestead, Diaz billed the county for several hundred yellow-flowered tabebuia trees 15 to 17 feet high. Typical actual size: eight to 12 feet.
* On Southwest 117th Avenue, Diaz billed for 347 royal palms at least 28 feet tall. Typical actual size: 22 to 24 feet.
* On Southwest 152nd Street east of Metrozoo, Diaz billed for 73 date palms 14 to 16 feet high. Typical size: Eleven feet, tops.
Two tree experts tapped by The Herald primarily checked the tallest trees listed on Diaz's bills -- 28 to 30 foot royal palms. The 2,900 trees represent about $864,000 in charges on Diaz's current $3.5 million contract.
At every location checked, the experts found palms shorter than what the county paid for. Metro routinely paid $300 for trees worth only $250 under its contract. The experts also found $15,000 in shortages on other varieties of trees. Total estimated loss to taxpayers: at least $160,000.
That's enough money to line nearly 40 blocks of Biscayne Boulevard with royal palms. On both sides.
A spokeswoman for Diaz had an explanation for The Herald's findings: The trees shrunk.
"I think that shrinkage is the primary reason, " said Lourdes Rodriguez, Diaz's office manager. "The height definitely is impacted by the cold weather and by the transplanting. You can lose three to four feet."
A University of Florida palm expert didn't believe it.
"It's pretty ridiculous, " said horticulture professor Alan Meerow, who helped develop tree-measuring standards for the state agriculture department. "I don't believe there could be that degree of shrinkage caused by transplant shock. Maybe a foot or so, but not four to six feet. I've just never heard anything like that."
Metro managers were skeptical as well.
Acting parks director William Cutie, who approved most of the payments to Diaz, said he suspects that palms selected by a county landscape architect were substituted with smaller trees by Diaz's crews.
"As a taxpayer, I have a problem with this, " Cutie said. "I have asked for a survey of the tree sizes, street by street. If they are not the right size, corrections need to be made."
In the midst of The Herald's inquiry, County Manager Armando Vidal also ordered an audit of Diaz's contract. Last week, after being told about the county's pending review, Diaz's spokeswoman said his company would pay up for any short trees.
"When their audit comes to light, we are going to give credit for what does not meet their specifications, " Rodriguez said. "There's no need to crucify anyone over this. There was a problem and it's been resolved between both parties. Everybody's a winner."
Diaz declined to be interviewed. But in a letter Monday to Publisher David Lawrence Jr., he wrote: "As an act of good faith, I have extended to Metro Dade County a very generous credit to satisfy whatever discrepancies might exist with my present installation contract."
He said trees should be valued by overall quality, not just by height, and added: "I have always grown the best quality trees in this state."
Diaz, 49, is a rags-to-riches entrepreneur who's become a top government landscaping contractor over the past two decades, collecting $16 million from Metro alone. Behind the scenes, he is considered well-connected to powerful politicians at County Hall and in Tallahassee.
Publicly he is known as a local Johnny Appleseed of sorts -- regularly donating trees to green Dade County, including the stately royal palms along Rickenbacker Causeway. He also provided without charge the lush palm backdrop at an open-air Mass celebrated by Pope John Paul II during his visit to South Florida in 1988.
While Diaz contributed thousands of dollars to commission election campaigns, his company landed most of the county business: $9.2 million since September 1994, nine times more than any other Metro landscaping vendor, records show. Metro officials say Diaz gets most of the work because his prices are the cheapest around, not because of political favoritism.
Diaz's share of county business is fueled by a multimillion dollar effort to spruce up county roadways -- a program whose cost has jumped $1.6 million in the past eight months alone.
Part of the reason: Some commissioners have turned palms into political pork, lobbying the county to deliver palms to neighborhoods in their districts.
Footing the bill: Dade County motorists, through a two- cents-a-gallon tax paid at the gas pump. Transportation money for landscaping was freed up when the county commission in 1993 increased the local gasoline tax by six cents to cover road and traffic improvements.
But taxpayers aren't always getting their money's worth. Metro's landscaping program is troubled by a number of problems, records show:
* Cutie, the acting parks director, OKd Diaz's billings without checking what the county got, approving thousands of dollars in overcharges for undersized palms. The county even paid $105,000 last January after a Metro supervisor complained that Diaz was overcharging for a strand of royal palms planted along Florida's Turnpike. The trees were short, the supervisor reported. The county was paying $50 too much for each palm.
Cutie blamed bureaucracy -- that Diaz was submitting his payment invoices to his department while Metro's public works department was in charge of the actual planting. The supervisor's complaint and other problems fell through the cracks.
"When there are too many hands, you lose quality control, " Cutie said. Tighter controls, he said, have been implemented in recent weeks.
* Diaz billed the county $55,770 for 338 tabebuia trees -- $165 apiece -- claiming they were 15-17 feet tall. They are typically eight to 12 feet tall, worth $40 less apiece. A Diaz competitor, Vila & Son Landscaping, put in a low bid of $120 for that size tree -- and should have gotten the order if that was the height the county wanted.
Metro paid $15,210 too much for trees along Southwest 157th Avenue, Southwest 288th Street and Avocado Drive in Homestead.
* The county purchased 1,045 Christmas palms from Diaz, a variety that is highly vulnerable to a fatal blight. The trees, planted heavily along Southwest 32nd Street and Southwest 248th Street, could whither and die within several years, palm experts said -- with the disease moving swiftly from tree to tree where the palms have been planted in rows.
Even Metro's top landscaping adviser said they shouldn't be used, and questioned why they were included in the contract. Cost to taxpayers: $141,075.
"My personal opinion is we shouldn't be planting any Christmas palms, " said Paul Carey, the parks department's chief landscape architect. "They are highly susceptible to lethal yellowing."
* In both urban and rural Dade, Diaz's crews have planted hundreds of palms close to power lines and even under them, creating a potential problem -- and additional cost to taxpayers. As the trees grow into the lines, they must be trimmed or cut down.
Homestead Electric Service officials complained in January that the county was allowing its contractors to plant trees under electric power lines. "The concern is that and the fronds will come in contact with the wires and customers may get a service interruption, " said Sergio Descalzo, an electrical engineer for the city of Homestead. "It's what we call a nuisance."
Rodriguez, the Diaz Farms spokeswoman, said the company planted all of its trees according to the county's directions -- and that eventually the trees will grow tall enough so that the fronds no longer will interfere with the wires. "After a while, it won't be a problem, " she said.
From the start, Metro's handling of Diaz's contract left the door wide open for abuse. Example: County representatives didn't measure and handpick trees for the projects as permitted under the agreement.
Instead, Emilio Fontana, a county landscape architect, said he "eyeballed" a field of palms at Diaz and roped them off to reserve them.
Fontana, citing 40 years of experience in the landscape business, said all the trees he reserved were at least 28 feet tall. But he never measured them.
"I cannot measure all the trees. I am too many years in my life, " said Fontana, 74. "It was too much for one person to check. What they pulled from the fields is not my responsibility."
At The Herald's request, Fontana checked trees planted along Kendall Drive, where Diaz charged $129,000 for 430 royal palms that were supposed to be 28 to 30 feet high. Fontana selected two: One measured 19 feet, the other 20 feet.
"These are not the ones that I saw, " Fontana said. "They are much smaller."
No one was told to check the size of trees until recently.
Guilio Miglio, the project manager supervising Diaz's plantings for public works, said it wasn't his responsibility to check the sizes of trees -- but that he did notice obvious problems and reported them to his bosses. His job was to make sure trees didn't block the view of motorists or interfere with utilities.
"I wasn't asked to approve or disapprove the quality or size of the palms, " he said. "I don't know whose job it was. We were moving so quickly, I didn't have the time."
Miglio told his bosses in December that Diaz bills were out of line after checking royal palms planted along Southwest 117th Avenue. Diaz had billed the county $300 each for palms that were supposed to be 28 to 30 feet tall.
"The plants vary from 21 feet to 26.5 feet, with the majority at 24 feet, " Miglio wrote in a Dec. 27 memo. "To date, no $300 palms have been delivered or planted on this project. Consequently, I recommend payment to the contractor be at the lower contract price of $250."
A day later, Cutie approved the full $300 for the palms despite Miglio's complaint, records show. The tab: $75,000.
Eight days after that, he OKd another bill for $40,500 -- again for 28 to 30 foot palms along 117th Avenue that Miglio insisted were short.
Miglio complained twice more in January -- once about Diaz's crews planting more Christmas palms than specified in plans, and once that trees of another variety, ligustrum lucidum, were six to eight feet tall instead of the 10-12 feet that the contract required. Cutie cut the $31,725 bill for the ligustrums by $1,586 -- a 5 percent penalty. Diaz was paid in full for the Christmas palms.
By that point, Miglio's boss was fed up, records show. He wanted Diaz to stop getting paid by sidestepping Miglio.
"Manuel Diaz Farms has not been adhering to the directions of our field supervisor, " highway division chief James Leone wrote to Cutie on Jan. 24. "To avoid continued indiscriminate plantings and assure payments are made in accordance with the correct heights, I respectfully request you instruct the contractor submit his invoices to our field supervisor for approval prior to your department processing these payments."
Cutie obliged in February, two months after the first written complaint. "When they brought the problem to my attention, we took care of the problem, " he said in an interview.
The county did something else in February: It added another $200,000 to Diaz's contract.
WHERE PALM TREES ARE SHORT
These are sites where Dade county got the short stick on trees planted since August as part of a $3.5 million contract with Manuel Diaz Farms, records show.
The company billed Metro for 28- to 30-foot royal palms. According to the Herald's experts, the county should have been charged for 22- to 24-foot trees, which cost $50 less apiece.
1.: Northwest 36th Street from LeJeune Road west to Milam Dairy Road.
The bill: $65,400 for 218 royal palms.
Estimated overcharge: $10,900
2.: Culmer Center, Northwest 17th Street and 3rd Avenue.
The bill: $25,800 for 86 royal palms.
Estimated overcharge: $4,300
3.: Northwest 6th Avenue from 21st to 27th streets.
The bill: $9,000 for 30 royal palms.
Estimated overcharge: $1,500
4.: SW 117th Avenue from Kendall Drive to Tamiami Trail.
The bill: $104,100 for 347 royal palms.
Estimated overcharge: $17,350
5.: Kendall Drive from U.S. 1 to SW 152nd Avenue.
The bill: $129,000 for 430 royal palms.
Estimated overcharge: $21,500
6.: Southwest 152nd Street from SW 137th Avenue to 157th Avenue.
The bill: $131,400 for 438 royal palms.
Estimated overcharge: $21,900
7.: Caribbean Boulevard from the Florida Turnpike to SW 184th Street.
The bill: $136,200 for 454 royal palms
Estimated overcharge: $22,700
8.: Southwest 216th Street from 112th Avenue to Old Cutler Road.
The bill: $33,300 for 111 royal palms.
Estimated overcharge: $5,550
9.: Southwest 248th Street from 112 Avenue to 187th Avenue.
The bill: $25,500 for 85 royal palms. Estimated overcharge: $4,250
10.: Southwest 152nd Avenue from 280th Street to 307th Street.
The bill: $64,800 for 216 royal palms.
Estimated overcharge: $10,800
11.: Southwest 157th Avenue from 288th Street to 304th Street.
The bill: $49,800 for 166 royal palms.
Estimated overcharge: $8,300
The bill also included: $7,920 for tabebuia trees 15-17 feet tall. An expert put them at 9-11 feet.
Estimated overcharge: $2,160
12.: Avocado Drive from U.S. 1 to 143rd Court.
The bill: $90,000 for 300 royals palms.
Estimated overcharge: $15,000
Also billed: $29,700 for 180 tabebuia trees 15-17 feet tall. Expert put them at 8-10 feet.
Estimated overcharge: $8,100
13.: Southwest 288th Street from U.S. 1 to 137th Avenue.
The bill: $18,150 for 110 tabebuias 15-17 feet tall. Expert put them at 9-12 feet.
Estimated overcharge: $4,950
MEASURING ROYAL PALMS
Metro's landscaping contracts call for palms to be measured using a state standard known as "overall height."
That's the distance from the base of the tree to the point where the upper most fully opened frond begins to curve.
The county contracted for three sizes of royal palms: 28-30 feet in overall height, 22-24 feet and 16-18 feet. The low bid prices of installed palms: $300, $250 and $199, respectively.
To determine whether county taxpayers got what they paid for, the newspaper asked three experts to measure the 28-to-30 footers listed on Diaz Farms invoices.
At 13 project sites, they measured a sampling of the tallest trees they could find. To ensure fairness to Diaz, they measured from the base of the tree to either the tip of the center spear or the top of the uppermost frond.
A University of Florida palm expert said The Herald's measuring method favored Diaz Farms.
"You have been very generous, " said Alan Meerow, an ornamental horticulure professor who helped develop the state's tree-measuring standards. "You could not come up with a more liberal definition of overall height."
The trees planted by Manuel Diaz Farms were measured by:
* Alyn D. Kay, a West Broward licensed landscape architect and former landscaping and maintenance supervisor at Miami International Airport.
* Marcus Urra, a former state urban forester.
* John Harris, a Hollywood licensed arborist, tree appraiser and president of Trees Advisors, a consulting and contracting firm.
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