Downtown Miami

There's a contract that says Museum Park should get $2 million a year. Why isn't it?

In the latest twist in a long-running dispute over payments for improvements at Museum Park, the Miami City Commission rejected a redevelopment agency's proposed budget Thursday before ultimately changing course.

The saga can be traced back more than a decade to the 2007 global agreement that enabled funding for Marlins Park and the PortMiami Tunnel. That document said the Omni Community Redevelopment Agency would begin making annual $2 million payments for Museum Park once the park component of the project was "substantially complete."

That's where it gets messy. The city says the project was substantially completed in 2014, but CRA staff says the threshold still hasn't been met and therefore it doesn't need to pay.

On Thursday, Commissioner Joe Carollo, who serves as chairman of the Bayfront Park Management Trust that oversees Museum Park, argued the CRA had not properly noted the latest unfulfilled $2 million payments as a liability in its budget documents. Carollo also sits on the CRA board along with his four fellow commissioners.

The commission initially voted 3-2 to reject the CRA's $34 million mid-year amended budget and potentially limit its ability to pursue affordable housing projects. Commissioners Wilfredo "Willy" Gort and Manolo Reyes sided with Carollo.

But during a recess for lunch, the CRA agreed to add a footnote about the disputed payment into its budget — enough for budget director Chris Rose to deem the document in compliance with budgeting standards and to swing the decisions of Gort and Reyes in an afternoon vote.

Still, Carollo remained defiant, challenging the proposal's legality.

"I find it difficult to grasp how anyone could think that, by just putting a footnote, you are going to be providing a real balanced budget as the state law requires," he said.

The clash once again pits Carollo against Commissioner Ken Russell, who chairs the Omni CRA. Russell has said the Museum Park payments do not align with the CRA's stated mission of spurring investment and job creation in blighted areas. CRA staff agree, saying they are committed to redirecting the $2 million annual payments — which expire in 2030 under the global agreement — toward affordable housing efforts.

The Omni CRA did make one $2 million payment to the city last year, which was intended to fund a futuristic playground at Museum Park that was proposed by Carollo's brother, Frank, a former commissioner and Bayfront Trust chairman. But the CRA has not made three other annual payments the city says it owes since 2015.

On Thursday, Carollo alluded to rumors last year that his brother was angling for the Bayfront Trust's executive director position, implying that the playground payment had been made after a political deal between Russell and Frank Carollo.

"I know why that was paid," Joe Carollo said. "There was a deal cut. It's not the deal that he [Russell] wants you to believe was cut. It was a deal for someone to have a waiver from this body so that they could be an executive director."

After the meeting, Russell told the Miami Herald he took issue with the comments and said the allegations had no merit.

Frank Carollo, asked for comment on the allegations, responded with a colorful text message to the Herald: "WOW--there is a reason why he [Joe] has earned the name 'CRAZY' and he cannot blame Fidel Castro, [Nicolas] Maduro or myself for that."

On Friday, Joe Carollo said he wasn't alleging any illegal activity between Russell and his brother, but rather that he believed there were informal "political side deals" at play when the CRA made the $2 million payment.

"You can't go and find any evidence that it was only a one-time payment," Carollo said. "It doesn't exist."

During the midday break Thursday, Omni CRA staff sat around a conference room table in Russell's office, frustrated at the city's continued insistence that they pay for a project that, in their minds, is far from "substantially complete."

City officials have big dreams for the 30-acre, waterfront space just south of the art and science museums. But despite a formal opening of Museum Park in 2014, parts of the piecemeal project remain unfinished. Progress has been delayed, in part, by disagreements over who should manage the park. The city rejected a proposal in 2015 to hand the reigns to a public-private conservancy, choosing instead to keep control with the Bayfront Trust, a semi-autonomous city agency.

Across Miami-Dade County, CRAs have been sharply criticized for failing to live up to their anti-blight goals. A 2016 grand jury report accused some CRAs of funding officials' pet projects and acting, essentially, as slush funds. But the Omni CRA maintains that, especially since the hiring of executive director Jason Walker in 2016, the agency has its priorities straight.

"We've made a positive commitment to affordable housing in our budget," the CRA's chief legal officer, Isiaa Jones, told the Herald. "We do not want to de-fund any of those projects to fund something that [the city has] breached on."

The dispute could be settled, perhaps, by reopening the controversial global agreement and having Carollo and Russell negotiate a one-time payment for Museum Park, an idea floated frequently but never executed. In January, the CRA board voted to support a renegotiation of the agreement that would release the CRA from $28 million in Museum Park payments between 2015 and 2030.

But Carollo and Reyes were absent from that meeting. They were also absent for the CRA's meeting in April, where the agency approved the same budget that was temporarily rejected Thursday.

In supporting their case against the Museum Park payments, CRA staff also point to a 2012 memo from former city attorney Julie Bru, which said the body did not have any continuing financial obligations related to the Museum Park project.

On Thursday, CRA staff carried jumbo-sized cutouts into the commission chambers of both the January resolution and the 2012 memo. That did little to move Carollo, who pointed to a loan document this year in which the CRA cited the park payments as a liability.

"It was a liability signed under penalty of perjury," Carollo said. "Please explain: How can you put a little footnote so you can claim a balanced budget?"

Jones, the CRA attorney, said loan documents and budget documents have different standards when it comes to reporting liabilities.

"A bank's analysis versus a legal analysis, they're two different things," Jones told the Herald.

At the January CRA meeting, Commission Chairman Keon Hardemon suggested that attempting to reopen the global agreement and strike down the CRA's Museum Park payments was akin to opening "a box of butterflies."

Russell offered a different simile: "I think it’s more like punching a hive of bees," he said.

"They sting back, right?" Hardemon replied, according to meeting minutes. "I don’t think this is going to be as easy as it seems."