South Florida

A year after fiscal meltdown, Opa-locka ‘barely bailing water out of boat’

Opa-locka’s iconic, old Ali-Baba style City Hall was being renovated, but the renovation stopped and the contractor walked off the job because the bills weren’t being paid. Wednesday, Nov. 4, 2015.
Opa-locka’s iconic, old Ali-Baba style City Hall was being renovated, but the renovation stopped and the contractor walked off the job because the bills weren’t being paid. Wednesday, Nov. 4, 2015. wmichot@miamiherald.com

The city of Opa-locka, notable for its Moorish-style buildings and Arabian street names, was given up for dead a year ago.

After running up millions in debts — and wasting taxpayer money on leased SUVs, parties and meals — political leaders reluctantly admitted that the city faced a financial crisis and asked the state for a helping hand.

Gov. Rick Scott declared a financial emergency on June 1, 2016, and appointed an oversight board that warned it would “not be business as usual” in this predominantly black city in Northwest Miami-Dade. Not since the late Gov. Lawton Chiles declared a similar emergency in the mid-1990s in the city of Miami — with a $68 million shortfall — had a Miami-Dade city captured so much attention over a financial meltdown.

But after a full year of scrutiny by the nine-member oversight board, which was accused by the mayor and another commissioner of racism, there has been scant progress at Opa-locka City Hall. While the city has an operating budget and a leaner staff payroll, it is running out of money this fiscal year — despite having the highest property-tax rate in Miami-Dade.

“I would have hoped we were farther along,” said Commissioner Joseph Kelley, the vice mayor who has been the strongest supporter of the board’s recommendations but has been at odds with the mayor and city manager. “As a city, we need to clamp down.”

Commissioners have not even begun to discuss a spending plan for the next fiscal year, which starts Oct. 1. Also alarming: The city has no audits of government spending for the past three years and has not come up with a long-term recovery plan as required by the governor under his emergency agreement with Opa-locka.

“We are today where were we were a year ago,” said Frank Rollason, city manager of North Bay Village and a prominent member of the state oversight board. “I see several things missing, especially a lack of commitment from city officials to recognize the shape they’re in. They’re never willing to admit, ‘You’re right, we messed up.’ They’re always pointing the blame at someone else.”

This past week, the governor’s designee, chief inspector Eric Miller, warned Opa-locka leaders in an emailed letter that they must “begin the budget process immediately” and submit the spending plan to Gov. Scott by Aug. 1. Miller also reminded local officials that they have failed to submit a five-year recovery plan that is needed to “avoid future problems for the city.”

The state’s pressure is mounting as the FBI continues to investigate corruption at all levels of Opa-locka’s government, which has led to guilty pleas by a former commissioner, city manager and public works supervisor for extorting local business owners seeking licenses. A major indictment charging others is expected later this year.

For the residents of Opa-locka — a low-income city of 16,000 that had been placed under a similar state emergency in 2002 — the state oversight board is seen as a godsend because at least outsiders are watching out for government spending, waste and possible corruption.

Many, however, don’t see Opa-locka progressing as long as Mayor Myra Taylor and two of her allies on the commission are still in power, along with Yvette Harrell as city manager. Barrett is involved in an effort to recall Taylor, whose mayoral term ends in 2018; meanwhile, Harrell, a lawyer who has only served as city manager since last August, plans to resign this summer once her replacement is hired by the commission.

“The real problem is, until the oversight board and governor remove the majority of the commissioners and the city manger, things will stay the same,” said Steven Barrett, a former vice mayor in Opa-locka. “The oversight board has done their job, but the commissioners don’t know what they’re doing.”

Kelley, the only politician who has consistently confronted the mayor and Harrell on policy issues, agreed with Barrett on the role of the oversight board.

Kelley believes the board, which reviews city spending and makes payment recommendations to the governor’s office every month, has made Opa-locka’s government “more financially responsible.”

“If we did not have the oversight board, things would be a lot worse,” said Kelley, who is also the city’s vice mayor. “I think we have made a little progress” under the board’s review, but “I think we should have made more progress.”

He said the challenge has been both financial and political, because the commission and city manager have not heeded many of the board’s recommendations.

A glaring example: The city’s commercial trash contract, the result of a bungled bidding process by the city manager and commission, has drawn the wrath of the oversight board.

In April, the commissioners voted to award a two-year contract to Waste Management and Great Waste, after the city manager said there was an “emergency” with the commercial garbage pickups in the city. The commissioners went against the wishes of the oversight board, which wanted the city to grant a one-year contract and redo the bidding process because it was so flawed.

“No emergency related to commercial waste hauling currently exists,” the governor’s designee, Miller, wrote in an emailed letter to the city manager on May 18. “There is, however, a continuing financial emergency, and a competitively procured service with a well-drafted contract will go a long way to improve the financial status of the city. … I cannot approve this [current] contract at this time.”

In late May, Kelley couldn’t persuade the other commissioners to even discuss accepting the oversight board’s recommendation to redo the trash-hauling bid.

The city’s former trash hauler, Universal Waste, sued Opa-locka over the bidding process after failing to win the new contract. “The solid waste issue shows they are not going to listen to the oversight board or anyone else,” said lawyer Michael Pizzi, a former Miami Lakes mayor who represents Universal Waste and once worked as an attorney for Opa-locka’s government.

In total, Opa-locka owes more than $14 million in debt to Miami-Dade County, city contractors and its public works department for having raided millions in restricted water and sewer revenues to cover huge holes in past budgets.

The county, which is owed $7 million by Opa-locka for unpaid water and sewer services, now operates the city’s utility billing collections. It also plans to loan the city between $2 million and $3 million to buy new water meters because most of the existing ones are broken and cannot be read — a serious problem that has led to wildly erratic bills for consumers. They recently filed a class-action lawsuit against Opa-locka government.

Opa-locka’s government plans to pay the old debt and new loan to the county over the next five years from water and sewer bill collections.

The county also handles the city’s residential trash collections.

Rollason, the oversight board member who personally checks the city’s outstanding bills every month, said Opa-locka’s government remains on shaky ground — not only because of past debts but because of looming deficits in the current budget. If Opa-locka’s political leaders want to maintain their autonomy as a city, they will have to hire professional administrators who know how to craft a budget, control spending and grow the tax base.

Said Rollason: “They are barely bailing water out of the boat.”

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