Miami Beach

Fast-tracked South Beach streetcar could be pricier than expected

This rendering shows what Alstom’s streetcar would look like.
This rendering shows what Alstom’s streetcar would look like. Greater Miami Tramlink Partners

A fast-tracked streetcar project has left Miami Beach in a tough negotiating position as it prepares to spend a year hashing out an estimated $244 million contract to build what could be the first piece of rail that would ultimately connect across Biscayne Bay to light rail on the mainland.

Earlier this year, the city’s elected officials urged administrators to pursue an unprecedented bidding process that could result in a more expensive project because they decided not to have bidders compete on price.

In July, the commission chose a team based solely on its train technology. Next, having reached a preliminary agreement about the scope of the talks, the City Commission in December will decide whether to open negotiations expected to take a year with Greater Miami Tramlink Partners. The consortium of companies, led by French rail company Alstom, sparked the current push for rail in South Beach when it submitted an unsolicited proposal last year. That action prompted the city to formally solicit bids; the Alstom team was ranked first of the three bidders.

The streetcar was moving with unusual speed until recently. The terms of an “interim agreement” — a pre-contract deal that outlines what will be worked out during negotiations for the actual contract — was scheduled to go before the City Commission on Wednesday, but on Monday was pushed to December in order for the city to get more public input, mostly through meetings to be held next week.

In October, the city’s plan for a loop around the heart of South Beach was cut in half because of higher than anticipated costs and pushback from locals exhausted by constant construction.

Proponents see the streetcar as a transformational project that will ignite serious interest from County Hall, the city of Miami and the Florida Department of Transportation to coordinate on a rail connection from downtown Miami to the heart of South Beach — a much-discussed but unrealized project that is commonly known as “Bay Link.” The streetcar would run on dedicated lanes taken from existing roadways.

But the final price and construction timeline are still unknown; the consortium’s initial estimates are higher than the city’s.

Because of the unusual process to reach these negotiations and the decision to spend less on design costs upfront, the Beach might be pushing forward with weaker bargaining power because it skipped price competition price early on, said Donald Cohen, an expert on public-private partnerships and executive director of In The Public Interest, a think tank.

“It may cost more,” said Cohen, “and you lose leverage.”

Mayor Philip Levine, a proponent of fast-tracking public projects that could get tied up in bureaucratic development hell, told the Miami Herald he feels the city actually has the upper hand because the city hasn’t committed to anything and it can walk away at any time during the next year.

Noting that he wants to avoid “analysis paralysis” — his preferred term describing the pace of public projects — Levine said he thinks the selected streetcar team has incentive to give the Beach a good deal and eventually pitch a link to the county and Miami.

“We could question it a hundred different ways, but the success is that the Beach is moving forward,” he said. “And I think this is going to get the county moving forward.”

Before the vote originally scheduled for Wednesday, local activists called on City Hall to hit the brakes and do more community outreach before voting on the interim agreement.

On Monday, the city did just that. City Manager Jimmy Morales emailed Levine and commissioners announcing a deferral of the vote on the interim agreement and touting a day of public meetings about the project to be held next week.

“This will give us an opportunity to engage in more community outreach regarding the interim agreement and the underlying project,” Morales wrote. “This will include the two public meetings being held on Nov. 15 at the New World Symphony.”

Joey Flechas: 305-376-3602, @joeflech

If you go

What: Light rail/modern streetcar public information meeting in Miami Beach

When: 3:30 p.m. to 5:30 p.m. or 6 p.m. to 8 p.m. (two sessions), Nov. 15

Where: New World Symphony Suntrust Pavilion, 500 17th St.

Parking available nearby:

Pennsylvania Avenue garage and 17th St. garage