For Opa-locka leaders, the perks are gone: no more costly SUVs. No more free gas. No more $200 monthly stipend.
And by the way — since Opa-locka’s government is nearly broke — the tax rate will be boosted to the highest level in South Florida to bring in badly needed revenue.
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That’s what the state financial oversight board ordered the Opa-locka City Commission to do this week in the first wave of drastic actions to put the impoverished community on the road to recovery.
If there were any doubts about who was in control of Opa-locka’s government, Wednesday’s meeting between the governor’s oversight board and the city commission made it clear.
“The city is not going to operate as usual,” Melinda Miguel, the governor’s inspector general, told Mayor Myra Taylor and commissioners in a conference call from Tallahassee — in a tone that stunned many spectators in the audience who were accustomed to their local leaders being in charge.
“We’re trying to keep the lights on,” said Miguel, the board’s chairwoman. “We are asking them to make drastic cuts. We are teetering on the brink of bankruptcy.”
Selected by Gov. Rick Scott last month, the board imposed the first in a long string of budget changes that could lead to even more cuts, including layoffs.
The state takeover coincides with two federal investigations: one by the FBI into corruption involving city officials, and another by the Securities and Exchange Commission into the city’s questionable bond deal to buy the new City Hall.
For hours, acting City Manager Yvette Harrell was peppered with questions by board members who have the veto power to reject any spending they deem unnecessary or wasteful.
At one point, when Harrell said the city needed to hire at least two people to help meet crushing deadlines to turn over financial information to the board, Miguel responded by laying down the state’s ground rules.
No new employees could be hired without state approval.
“Am I clear?” Miguel asked
“Yes, ma’am,” answered Harrell. “You are very clear.”
The board has demanded a new budget and recovery plan by Aug. 1.
And so it went throughout the day-long meeting, in which board members expressed frustration with the city’s financial statements and cash-flow projections.
In the end, the board approved about $910,000 owed to city vendors for such essentials as employee health insurance, pension contributions, and phone and internet service. But the board — represented locally by North Bay Village City Manager Frank Rollason, former Miami-Dade Police Director J.D. Patterson and Miami Gardens Assistant City Manager Vernita Nelson — also blocked tens of thousands of dollars in other payments.
In its most politically sensitive move, the board ordered the city to slash or renegotiate contracts for leased SUVs for the city commissioners, including turning them in for less expensive cars. The annual payments add up to $50,000.
“We’re trying to curtail costs, and one of the cost savings is the surrendering of those vehicles,” said Rollason, a former veteran Miami administrator, who had dealt with Miami’s fiscal crisis nearly a generation ago.
Rollason also insisted the commissioners could no longer obtain free gas from the city. “They have to pay for the gas themselves,” he said.
He also demanded that the commissioners, who are paid $6,600 a year, give up an additional discretionary monthly stipend of $200.
Despite one of the commissioners, Vice Mayor Timothy Holmes, pleading with the board not to cut the stipend “so I can get my clothes cleaned,” the board moved to end the perks.
The tone of the meeting came as a surprise to residents, who watched as the board members picked apart the commissioners’ practices. “I learned more here than I have in the last 10 years,” former Vice Mayor Steven Barrett told board members during the public comments.
It is not to be assumed the commission or the city is going to operate as a business-as-usual policy. It’s time to make this very clear.
Melinda Miguel, board chairwoman, Gov. Rick Scott’s chief inspector general
Perhaps most significant, the board also recommended the city raise its tax rate for the upcoming year to $10 per $1,000 of assessed property valuation — the top level allowed under state law. If approved by the city commission in September, that would amount to an increase of $1.10 over this year’s tax rate of $8.90.
But it’s unclear how much revenue the hike would generate. The reason: the median home value in Opa-locka, one of the poorest cities in Florida, is just $53,000. And with homestead exemptions on residential properties, the overall revenue increase might not be that substantial.
On Wednesday night, the commission voted 3-1 to adopt the higher rate, with Commissioner Joseph Kelley dissenting. “I can’t support it,” he said. “That’s just too big for me.”
Mayor Taylor said the oversight board recommended the maximum tax rate so the commissioners would have the flexibility to reduce it when they approve the new budget in the fall.
During the oversight board meeting, tensions rose from time to time — especially when the panel learned that embattled City Manager David Chiverton, who took an unpaid leave of absence in May, wanted to return to his $125,000-a-year job in a few weeks.
The 51-year-old manager took a medical leave shortly after a Miami Herald investigation found that he paid himself almost $40,000 in benefits for unused sick and vacation time that he was not entitled to.
Harrell, his acting replacement, told the board that Mayor Taylor wanted to reinstate Chiverton. But Miguel, the chairman, warned there were too many questions about Chiverton’s payments that must be resolved. “I would like to do a full study” of his actions and “get to the bottom of this,” Miguel said.
In the meantime, Harrell said he was still collecting full benefits, including medical and dental coverage, driving a city-leased car and carrying a city cell phone and computer.
Vice Mayor Timothy Holmes pleaded with the board not to cut commissioners’ $200-a-month stipend “so I can get my clothes cleaned.”
Miguel also grilled the city on its controversial use of surtax money — dollars given to local governments from a special sales tax that’s only to be used for road repairs and similar needs. Harrell said it was still unclear whether the city misspent its share of the money over the years. However, records show Opa-locka leaders dipped into the money — to the tune of nearly $800,000 — to cover chronic budget shortfalls, in violation of the law.
Because of the practice, the county late last year imposed a ban on the city getting any more of the surtax funds.
At the end of Wednesday’s board meeting, Miguel issued a warning that any “frivolous, abuses or waste” in spending was to be reported to the state.
“It’s time for all hands on deck,” she said. “It’s not the time for raises. It’s not the time for excess. ... You can either be a part of the problem or a part of the solution.”
At a regular commission meeting on Wednesday night, Holmes bemoaned the changes. “The state is coming in and taking everything,” the vice mayor said, as he itemized the loss of perks ordered earlier in the day. “That’s what people had to look forward to [when running for office.] All of that is being taken away from us.”