Funding for Overtown redevelopment delayed amid financial dispute
Miami commissioners, sitting as the board of an anti-poverty Overtown agency, will consider a small bond issue Wednesday to get around a financial dispute with the county that threatens to hinder redevelopment in the neighborhood.
07/26/2014 6:42 PM
07/26/2014 6:42 PM
Two years ago, when a proposal to pump millions of public dollars into Overtown was imperiled, a large crowd packed Miami City Hall to demand support for a significant redevelopment plan. Their message was clear: The people of Overtown had waited long enough.
They were heard, and the city — and later the county commission — signed off on a $60 million bond issue to pay for five mixed-use projects through a city anti-poverty agency.
But so far, not a dollar has been spent as the county and the Southeast Overtown/Park West Community Redevelopment Agency fight over funding.
County officials, who threw project financing into question late last year by arguing that an old law capped their financial obligation to the agency, say they’ve offered a reasonable resolution. “We all want the projects to move forward,” said Deputy Mayor Edward Marquez.
Miami Commissioner and CRA Chairman Keon Hardemon, however, says the cash-strapped county is taking a position that would cripple future projects in Overtown. He wants city commissioners on the CRA board to approve a smaller bond issue Wednesday that essentially ignores the county’s funding stream and then file a lawsuit to force the county to pay what he says it owes.
“This is nothing but bullying and robbery on behalf of the county,” he said.
Just months ago, the city and county were ready to move forward as partners through the CRA, which collects property-tax revenues from the city and county within specific boundaries for redevelopment and anti-poverty initiatives. The projects to be funded by the $60 million were billed as crucial to reinvigorating a once-thriving community shattered decades ago by expressway construction.
They included four developments to the north and south of Interstate 395: a gut rehab of the old Town Park communities; a six-story apartment building next to the Culmer Neighborhood Center; and mixed-use developments next to the newly renovated Gibson Park and St. John Institutional Baptist Church. A fifth mixed-use project and parking garage was planned next to the historic Lyric Theater.
Clarence Woods, executive director of the CRA, said the developments would flush sparse residential areas of Overtown with hundreds of apartments, encouraging new development and start-up businesses. “They’re critical to the redevelopment of the Overtown area,” he said.
But during the process of underwriting the bonds, someone noticed that an old aspect of the county ordinance authorizing the creation of the CRA also capped the county’s funding on a specific date. Marquez said the capped year was 2012, limiting the county’s investment at just under $4 million.
Immediately, the county pulled back $700,000. But the long-term implications were in the millions, particularly with more than $250 million in new development projects slated to break ground in Overtown during the coming years that would grow property-tax revenues.
With the CRA’s long-term finances in question, the agency’s underwriter announced it couldn’t back such a hefty bond issuance without a resolution to the problem. The county said its funding was bound by law but offered several alternatives it argued would free up other CRA funds to back the bonds.
County Commissioner Audrey Edmonson, who represents Overtown, said months ago that a deal could be swift. This week, she said Hardemon has held up the bond financing and delayed the projects.
“What the chairman of the CRA wanted was to take it to court. And that would cause the current developers to leave,” she said. “My only objective is to see development and redevelopment occur in the Overtown community, but it appears that this is being intentionally prolonged.”
Hardemon said that talk of collapsing deals are “lies” perpetuated to seek leverage. He said Miami commissioners can get the money flowing again Wednesday by authorizing a minimum bond issue of $43.5 million through Wells Fargo, an amount he said would fund all of the projects and simply require prioritization of what gets funded.
Though some commissioners want a swift resolution, Hardemon says a lawsuit is the best tactic in the long run. The CRA’s position is that the county law establishing the CRA funding cap was crafted unilaterally and without the city’s consent, against state law.
The stakes, Hardemon said, go beyond those projects and affect the Overtown agency’s long-term buying power and ability to revitalize the neighborhood.
“Just when this community is about to enter into something special, they want to cut us at the knees,” he said. “I won’t allow them to cripple the CRA.”
In the meantime, the developers are waiting for a resolution to unlock their funds. Representatives with developers St. John Community Development Corporation, the Housing Trust Group and Atlantic/Pacific did not return calls for comment or were unavailable. Nick Inamdar, a principal of The Gatehouse Group, the developer behind the mixed-use Lyric Place, said he hopes to get moving and has been ready since January.
“We’re hopeful once it’s resolved we’ll be able to hit the ground running,” he said, “and break ground by the end of this year.”
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