In late March, state emails show, Florida’s Department of Environmental Protection was poised to pull the plug on a long-delayed, contentious plan to build a resort and mega-yacht marina on Miami’s Watson Island.
But developer Flagstone Island Gardens had an ace in the hole. A month earlier, the company hired Fort Lauderdale lobbyist William “Billy” Rubin, a longtime personal friend, business associate and political supporter of Gov. Rick Scott.
Within weeks of Rubin’s hiring, the DEP dropped its opposition to the estimated half-billion dollar resort project. Instead, Secretary Herschel Vinyard recommended the state waive a significant impediment: a deed restriction barring private development on Watson Island, land the state deeded to Miami in 1919.
Gov. Scott and the Cabinet unanimously approved the controversial waiver on May 19, state records show.
Such positive action by the state had seemed unlikely only two months before. At a March 26 meeting, top state environmental protection officials — including Deputy Secretary Katy Fenton and State Lands Manager Scott Woolam — had reiterated their opposition to the waiver to both the developer and the city.
“It became apparent to the city and Flagstone that a speedy flip of our longstanding position was not forthcoming,” Deputy General Counsel Thomas Sawyer wrote in an April 1 email to his boss and Fenton summarizing his department’s concerns.
Yet a speedy flip did come, and it happened in spite of objections from the Sierra Club, the Tropical Audubon Society, and Coral Gables lawyer Sam Dubbin, who represents Stephen Herbits, a condo resident on the Venetian Causeway who unsuccessfully sued the city to stop the project in 2004. In his complaint, Herbits argued Watson Island should only be used for public purposes and that the resort would block his condo’s view of downtown Miami.
Herbits, who used Florida’s public records law to obtain emails about the matter from both the state and the city said in an interview that lobbyist Rubin is the reason the waiver was granted.
‘ON INSTRUCTIONS FROM THE CAPITOL’
“Fenton, Woolam and Sawyer told us that the department had changed its position based on instructions from the Capitol,” Herbits said. “The developer sent in a lobbyist with direct access to the governor, who then shut the public out of the process.”
Rubin did not return phone messages seeking comment. But Flagstone’s lead lobbyist, Brian May, acknowledged that Rubin played an important role in convincing both Scott and Vinyard that their client deserved to continue with its Watson Island development.
“I think Billy was very helpful,” May said. “No doubt, he did a great job.”
Scott’s spokesman, John Tupps, would not answer questions about Rubin’s role in securing the deed waiver, but provided this statement: “We trust the voters of Miami and the City Commission can decide what’s best for the development of Watson Island.”
Flagstone has fought to keep its project alive for more than a decade.
In 2001, Miami voters approved leasing prime waterfront land on Watson Island so Flagstone could develop its resort and marina. But 9/11 caused the first in a series of delays as Flagstone’s owner, Turkish businessman Mehmet Bayraktar, was unable to secure financing for the project. The real estate market crash in 2008 brought more problems as Bayraktar’s company was besieged by lawsuits and further delayed by dredging for the recently opened port tunnel.
Despite those setbacks, city commissioners and state officials granted Flagstone several extensions and lease modifications.
In 2013, Flagstone announced it was teaming up with the Related Group to build a much larger version of the project. However, the partnership was short-lived as Related pulled out following opposition from Miami Beach city leaders about potential traffic congestion on the MacArthur Causeway.
Today, the site remains barren and overgrown.
As part of its agreement with Miami, Flagstone pays the city base rent of $2 million a year. Should the project get built, the city would also collect one percent of the revenues from the marina slips and two planned hotels and a shopping mall.
Herbits and other critics accuse the city of using outdated appraisals to determine those payments. Indeed, two recent appraisals conducted by the city found Flagstone ought to pay $7 million a year based on today’s real estate market.
After years of wrangling and delay, Flagstone and the city went to the Department of Environmental Protection in September 2013 asking help in securing the deed restriction waiver. They were met, however, by regulators’ concerns about the project’s viability after failing to break ground after more than a decade and Flagstone’s failure to pay off five court judgments it had earlier told the department it would satisfy by a January 2012 deadline.
Email traffic shows that environmental officials not only opposed the waiver, but wanted Miami to give the state 50 percent of the base rent instead of the 15 percent in the original agreement.
ENTER BILLY RUBIN
Months went by without any movement. Then, in February, lobbyist Rubin entered the picture.
Initially, the city wanted to retain Rubin to lobby on its behalf. On Feb. 7, Assistant City Manager Alice Bravo sent an email to Rubin saying the city was in the process of preparing a professional services agreement for him to sign.
Instead, Flagstone hired Rubin. Florida’s online lobbyist database shows he registered to lobby the executive branch on Feb. 19. He later reported Flagstone paid him between $20,000 to $29,000 for the quarter.
Rubin, owner of The Rubin Group, gave Flagstone the influence of a Tallahassee insider who was part the governor’s inner circle upon his election in 2010. Rubin helped select candidates for Scott’s transition team.
In the early 2000s, Rubin and Scott — along with then-Broward Sheriff Ken Jenne — served together on the board of Cyberguard, a Deerfield Beach computer security firm in which both men had invested. Securities and Exchange Commission records show that Scott ultimately made more than $60 million from his Cyberguard investment.
The day Scott was elected, Rubin told the Tampa Bay Times that he had met Scott in 1991 when the governor was building his Columbia/HCA hospital company. “We’ve stayed close ever since. I love him,” Rubin said at the time.
Rubin added that he would not benefit from Scott being in the governor’s office. “I won’t be. I’ll quickly dispel that perception.”
In fact, Rubin is currently registered to represent 62 clients before the governor and executive branch agencies — including Flagstone and heavyweights like Florida Power & Light, Florida East Coast Railway and HCA Healthcare.
EVENTS MOVE FAST
May, Flagstone’s other lobbyist, said the company retained Rubin because of his relationships with the governor and the Cabinet. He said it was done to counter Herbits and Dubbin’s efforts to stir things up at the Department of Environmental Protection.
“By the time we realized what was going on,” May said, “the best thing we could do is get Billy to lead the effort and get everyone to move forward. I am sure he spoke to the governor’s office since you don’t get on the cabinet agenda without talking to the governor’s office.”
Herbits disputed May’s version, noting that the department of environmental protection conducted its own research to determine that Flagstone had gotten a sweetheart deal.
“The state agency responsible for protecting the public interest was about to rule against the project,” Herbits said.
Spokeswomen for two Cabinet members, Chief Financial Officer Jeff Atwater and Agriculture Commissioner Adam Putnam, said that lobbyist Rubin did not meet with them or any members of their staff. A spokesperson for the third member of the Cabinet, Attorney General Pam Bondi, did not respond to questions.
Flagstone’s waiver request appears to have come before the Cabinet in May with unusual speed.
DEP counsel Sawyer’s email about the March 26 meeting says Deputy Secretary Fenton had informed Miami Assistant City Manager Bravo that placing the issue on the Cabinet’s May 13 agenda “was unreasonable” given that it usually takes three to four months to get an item on the calendar. He added that Fenton was “going to check the pulse of cabinet aides to determine if there is an interest in trying to rush this onto the May agenda.”
Herbits said he later was shocked to learn that Vinyard had not only put the Flagstone waiver on the Cabinet agenda for May 13, but had recommended its approval without mentioning his staff’s opposition. According to a transcript of the meeting, DEP staffers did not make any comments.
DEP spokeswoman Tiffany Cowie refused to answer specific questions about Sawyer’s email and Rubin’s involvement. This was her statement: “Based on the support of Miami’s voters and the city commission, the department brought this issue before the Florida Board of Trustees.”
According city administrators, Flagstone met a June 2 deadline to commence construction when the developer sent a diver to survey coral and other sea life that has to be relocated before dredging for the marina begins.