Miami-Dade County

Brightline developer wants to build the county a courthouse. Cost? That’s a secret.

A proposal backed by Florida East Coast Industries would build a new civil courthouse next to the existing one at 73 W. Flagler St.
A proposal backed by Florida East Coast Industries would build a new civil courthouse next to the existing one at 73 W. Flagler St. New Flagler Courthouse Development Partners LLC

Call it one of the most expensive secrets in County Hall: The company behind Brightline has submitted a detailed proposal to build Miami-Dade a new civil courthouse next to the existing one on Miami’s Flagler Street. But the company demanded that the mayor not share key details — including the potential cost to the public.

“This confidentiality request severely limits the Administration’s ability to transparently inform the Board of the impact of pursuing the unsolicited proposal,” Mayor Carlos Gimenez wrote in an April 4 memo urging commissioners to reject the plan to replace the 1928 courthouse with one built next door.

“Critical information pertaining to the financial impact of this unsolicited proposal cannot be communicated in this report for the benefit of the Board or Miami-Dade County taxpayers,” Gimenez said.

The county did reveal the barest financial outlines of the proposal in January, when its Internal Services Department released a cover letter signed by an executive of Florida East Coast Industries, the parent company of Brightline. The letter said the courthouse would cost about $368 million to build, but it doesn’t lay out the decades of payments the developer wants in exchange for financing the construction up front and managing the building for 35 years.

And while the mayor’s memo said he can’t “transparently inform the Board” of the impact of FECI’s plan, a spokeswoman said Sunday that commissioners did see the confidential proposal.

That leaves the public largely in the dark as commissioners prepare for a showdown vote Tuesday. The 13-member board is set to decide whether to accept FECI’s offer and begin seeking other bidders for the plan, which includes a requirement that the developer be allowed to convert the existing 1928 courthouse into a for-profit property.

Or the commission could stick with the Gimenez administration’s ongoing effort to recruit developers to build a less expensive facility a few blocks north on a parking lot next to the county’s Children’s Courthouse. It also could attempt to combine the two, with Miami-Dade pursuing both options simultaneously.

Tuesday’s vote may represent the most pitched courthouse fight since 2014, when Miami-Dade voters soundly rejected pleas by judges and lawyers to raise property taxes in order to fund a replacement to the county’s main civil courthouse. The tower, old enough that it once housed a trial for Al Capone, has faced leaks, mold and complaints of outdated, cramped courtrooms.

The FECI dispute pits the mayor against the leadership of the county’s legal community, with Chief Judge Bertila Soto urging lawyers to fill the seats at County Hall’s commission chambers on Tuesday. In an email inviting lawyers to a March 21 meeting about the upcoming commission vote, Soto and Judge Jennifer Bailey described the FECI plan to rehab the 1928 building as “honoring and maintaining its historic character and iconic status.”

courthouse rendering oct 2017
The proposed new civil courthouse next to the Children’s Courthouse at 155 NW Third St., Miami. The administration of Mayor Carlos Gimenez wants the two facilities to share space in order to save money, but the County Commission has resisted that effort. MIAMI HERALD FILE

The email urged lawyers to tell commissioners “if you have an opinion about where the courthouse should be — either on Flagler Street or at the Children’s Courthouse Parking lot site.”

In February, Soto publicly opposed Gimenez rejecting the FECI proposal, saying Miami-Dade needs as many developers as possible offering creative solutions to the courthouse problem. In a statement Friday, Soto said the judges don’t favor one developer over another. “No one has been asked to specifically advocate for any party and we would not do, so” Soto wrote.

Last week, Soto traveled to Texas with the county commissioner who has been Gimenez’s top foe in his effort to build a cheaper courthouse next to the juvenile facility. Soto accompanied Commissioner Sally Heyman to Fort Worth to visit a juvenile-services facility that Heyman wants to build next to the Children’s Courthouse, blocking any chance of the civil courthouse going there.

“I believe this is the perfect model for us to pursue adjacent to our new building,” Heyman wrote in a March 9 letter to Soto, referring to the Children’s Courthouse that opened in 2015. The letter was released Monday through a records request, and a Soto spokesman confirmed the judge’s participation in the two-day trip that the letter said began April 2.

Heyman sponsored the February resolution that overturned Gimenez’s initial rejection of the FECI proposal and instructed the county to include the Flagler Street location in its ongoing pursuit of courthouse developers.

With Miami-Dade already facing a revenue squeeze — on Friday, the Gimenez administration said it planned to eliminate up to 1,300 vacant positions across the bureaucracy starting this fall — the final spending plan for the courthouse will depend on how many spare dollars the county can find.

In July, a county consultant estimated that by sharing a lobby with the juvenile courthouse next door and other savings, a new courthouse there would cost about $280 million. County commissioners have already voted against Gimenez’s proposed cost savings and pursued a project expected to cost closer to $360 million.

The July report by KPMG said Miami-Dade would have to pay at least $25 million annually for 35 years for a courthouse next to the juvenile facility. The Jan. 5 letter by New Flagler Courthouse Development Partners, the entity formed by FECI and partner Hunt Development out of Texas, also predicts 35 years of payments starting at $26 million for the Flagler Street courthouse, with some automatic (but unspecified) increases to keep up with inflation.

A key difference between the payment scenarios outlined in the two documents is the fate of the existing courthouse. FECI wants to take over the building as part of its development deal for a new facility. Gimenez, citing industry recommendations, said Miami-Dade would make more money offering the 1928 courthouse in a separate transaction without the burden of the winning bidder having to build a courthouse, too.

His memo also noted the parking lot next to the Children’s Courthouse is twice the size of the small county park and parking lot west of the existing courthouse on 73 W. Flagler St. where FECI wants to build. He said the FECI plan requires permanent closure of a stretch of First Avenue, and could complicate efforts to sell off the nearby Cultural Center Plaza for a large commercial development to raise money for the courthouse project.

“The use of the Flagler Site would reduce the county’s revenue potential,” Gimenez wrote.

In January, the Gimenez administration issued a request for developers interested in the courthouse next to the Children’s facility at 115 NW Third St. to submit their qualifications for the project. The FECI proposal arrived at roughly the same time, and Gimenez issued a memo rejecting it as needless competition with the process already under way. County commissioners, at the urging of Soto and Heyman, overruled Gimenez and instructed him to conduct the in-depth review of the unsolicited proposal that his administration released last Wednesday.

In its Jan. 5 cover letter, the FECI group said the Flagler Street location “optimizes relationships with the historical judicial core of the County” — an apparent reference to the law offices and other facilities that have built up around the courthouse. The letter also said by going with FECI, Miami-Dade can quickly get the courthouse project moving since it would have a well-considered proposal in hand that other developers would have to beat.

FECI was in extensive talks in 2014 about including a new courthouse inside the cluster of commercial towers being built around its new for-profit railway next to County Hall. The company would have used the higher property taxes to build the courthouse as one of the towers. But when voters rejected the bond item with a 64 percent No vote, the courthouse effort stalled for lack of money and FECI proceeded with its Brightline train depot without the custom designs and security measures needed for a courthouse.

Miami-Dade wants the courthouse to be the county’s first official “public-private partnership project” — where a developer pays for the courthouse upfront and agrees to operate it for decades, in exchange for yearly payments from Miami-Dade.

New state and local government laws offer for-profit companies the option to propose their own privatization ideas “unsolicited,” with governments given the option of rejecting them outright or seeking competing bids under a procurement framework laid out in the proposal itself.

For FECI, Miami-Dade would be required to issue a request for competing bids in May and developers would have until July to submit their own proposals, according to Gimenez’s memo. With FECI having months — if not years — to work on its bid and competitors just weeks, Gimenez said adopting the FECI proposal would all but guarantee that the Brightline developer would end up the winning developer on the courthouse bid.

“If the Board chooses to overturn the current recommendation, the Board should be prepared to award a long-term contract through a process that will have the effect of a bid waiver,” he wrote, using the term for no-bid deals.

A 2016 Florida law shields “unsolicited” privatization projects from the state’s open-records laws, treating the proposals as unsealed bids in a traditional government procurement. Miami-Dade would be forced to make the FECI proposal public after 180 days or after the county has sought competing bids and is preparing to pick a winner.

An FECI executive released a statement saying the proposal remaining confidential is the only way to keep would-be competitors from having the advantage of seeing the pricing behind a rival’s bid. The statement noted Florida runs its transportation projects the same way: “Companies submit bids and they are made public at the same time, eliminating the opportunity for other companies to bolster their bids using someone else’s work.”

When FECI demanded confidentiality for its proposal, the company requested an exemption for Soto and other judges. Representatives of the mayor’s office and the court said that request was denied.

Myriam Marquez, communications director for Gimenez, said the administration had no choice but to comply with FECI’s request to keep the proposal shielded from taxpayers. “Believe me, the mayor would love to make it public,” she said.

Barbara Petersen, president of Florida’s First Amendment Foundation, said the public deserves to know the details before Miami-Dade commissioners make big decisions on the courthouse.

“We’re paying for this courthouse. It’s our money,” she said. “Government is acting on our behalf here.”

Brightline launched its first train route from Fort Lauderdale to West Palm Beach Friday, Jan. 12, 2018, bringing new commuting options that the rail line said will alleviate traffic hassles for commuters.