Forget about a financial bailout, Opa-locka is told

A month ago, Opa-locka Mayor Myra Taylor complained about the state’s takeover of her financially troubled city, calling its actions “rude and disrespectful” in an email to the governor’s chief inspector general. The mayor said what’s really needed to put the city’s government back on track is a low-interest bridge loan.

On Thursday, the mayor got her answer loud and clear — although she wasn’t in the audience to hear it.

Merrett Stierheim, a formidable former Miami-Dade County manager now helping the state try to rescue Opa-locka, said “that’s not going to happen.”

“There is no free money,” Stierheim said repeatedly at a state oversight board meeting with city officials at the Sherbondy Village community center.

He said neither the state nor the county is going to give Opa-locka an inexpensive loan to keep it afloat while the city’s government still owes millions of dollars to vendors and creditors, including its biggest, Miami-Dade’s government. He said that since he agreed last month to help the state’s board come up with a recovery plan for Opa-locka, he has grown increasingly pessimistic about the city’s future.

“The city is facing a financial crisis that I don’t know if I can get it out of or not,” lamented Stierheim, who since he helped the city of Miami recover from near-bankruptcy two decades ago has been known as a legendary troubleshooter. He said “the gap” between his “hopes versus reality … continues to widen.”

Stierheim’s scathing remarks, which reflected his grim assessment of the city’s finances in a recent memo, come at a critical time and follow a Miami Herald story of excessive spending by the mayor and other local officials. Opa-locka, which is running out of money as the fiscal year ends Sept. 30, must soon adopt a new budget and eventually come up with a long-term recovery plan.

While Stierheim stopped short of recommending that Gov. Rick Scott place Opa-locka in bankruptcy, he said in his memo that the state should provide the city and oversight board with information on how “this can legally occur.”

At Thursday’s meeting, attended by three commissioners but not the mayor, Stierheim spelled out a litany of mounting problems that have contributed to the near-collapse of one of Florida’s poorest cities — from millions in government debt to a lack of political will and professional expertise to solve the crisis.

Foremost, Stierheim told City Manager Yvette Harrell that she needs to hire a new financial director and external auditor, noting that Opa-locka’s books have not been certified since 2014. He also said other departments, especially human resources, need to be overhauled.

And, Stierheim said, the city must stop the improper practice of raiding its water and sewer department like a “cash cow” to cover huge holes in the general operating budget. The oversight board recently authorized the county’s water and sewer officials to manage the city’s utility billing program, which generates millions in revenue but fails to collect payments in a timely manner from hundreds of residential and business customers.

Overall, he said the city has no accurate accounting of its finances because of its failure to reconcile spending with expenses, forcing the oversight board to make budgetary recommendations based on estimates.

“The warning flags — the hurricane flags — were up four years ago and they were ignored, largely by the city commission,” said Stierheim, who noted in his memo that the city’s “reputation has been sullied and tarnished by allegations of gross mismanagement and scandal,” without mentioning the FBI’s three-year corruption investigation of Opa-locka’s government.

His personnel and financial recommendations were formally adopted by the oversight board on Thursday, along with a separate proposal for the city to consider hiring the county to pick up Opa-locka’s residential trash at a potentially significant savings.

Stierheim, who has been deputized as a state inspector general, and a few members of the oversight board said they were troubled by the city commission’s decision not to select Waste Management as Opa-locka’s new waste hauler. Taylor and two other commissioners, Luis Santiago and John Riley, voted against choosing Waste Management at last week’s commission meeting. The company was recommended by the city manager and a staff selection committee over three competitors.

When casting her vote, Taylor did not disclose that her son, Corleon Taylor, works as a dispatcher for the city’s current trash contractor, Universal Waste Services. The firm had filed a bid protest before losing the contract and also owes Opa-locka’s government hundreds of thousands of dollars.

On Wednesday, the mayor and fellow commissioners Santiago, Riley and Joseph Kelley voted to extend Universal’s contract for 120 days so the city’s garbage would continue to be picked up after the fiscal year ends. The extension also allowed the city manager more time to evaluate the trash-hauling bids.

Melinda Miguel, the state’s chief inspector general who heads the oversight board, said the commission’s decision not to select Waste Management was suspicious and costly. She noted that the firm was willing to advance the city $1 million in franchise fees from commercial trash pickups — critical funds that would have helped Opa-locka at the start of a new fiscal year.

“It seems like a procurement [decision] that’s been derailed, and it causes me discomfort,” said Miguel, who noted a “relationship” issue between the city and Universal without mentioning the mayor or her son by name.

This story was originally published September 22, 2016 at 4:49 PM.