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HomeMy WebLinkAbouta 2004-25531 Reso " RESOLUTION NO. 2004-25531 A RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, APPROVING AND AUTHORIZING THE CITY MANAGER TO EXECUTE A SECOND AMENDMENT TO THE "AMENDED 1996INTERLOCAL", (AS SAID TERM IS DEFINED IN THE SECOND AMENDMENT) BETWEEN MIAMI-DADE COUNTY AND THE CITY OF MIAMI BEACH WHEREAS, the Convention Development Tax (COT) is a three percent tax imposed on transient rentals that is authorized by State statute; and WHEREAS, the State statute sets forth that two-thirds of the proceeds shall be used to extend, enlarge, and improve the largest existing publicly owned convention center in Miami-Dade County (the two-thirds portion); and WHEREAS, the two-thirds portion may be utilized for other eligible purposes, as provided in the statute, including stadiums, exhibition halls, arenas etc.; and WHEREAS, on June 21, 1996, the City and Miami-Dade County entered into an Interlocal Cooperation Agreement, regarding the disposition of the two-thirds portion of the COT, which enabled the County to allocate COT receipts for the construction of the Performing Arts Center (PAC), and also sets forth various other business terms (the 1996Interlocal); and WHEREAS, in May 2001, as a result of the expiration of the March 31,2001 deadline for the construction of the PAC referenced in the 1996 I nterlocal , the parties executed Amendment One, dated April 24, 2001 (the First Amendment), which provided, among other things, for the County to make certain payments to Miami Beach, including a $15 Million payment due December 1, 2003, which has not been paid, and a subsequent payment of $50 million due on May 1, 2004, if a pledge for the construction of a baseball stadium had not been made by the County by December 1, 2003; and WHEREAS, on February 4,2004, the Mayor and City Commission adopted Resolution No. 2004-25484, authorizing the City Attorney and City Managerto institute proceedings under the Florida Government Conflict Resolution Act, pursuant to Chapter 164 of the Florida Statues, regarding the County's non-payment of the $15 million; and WHEREAS, on February 28, 2004, the City and County held the first formal hearing and, at that meeting, the County stated that its non-payment of the $15 million was based on the lack of available two thirds portion of the COT receipts, due to prior obligations and commitments; and WHEREAS, on February 28, 2004, the County also provided a schedule of current COT receipts and committed expenditures, evidencing lack of available funding for existing obligations, including the $15 million payment; and WHEREAS, since December 2003, the City Administration has been in ongoing discussions with the County Manager to resolve these outstanding disputes; and WHEREAS, the attached Second Amendment to the Amended 1996 Interlocal (as said term is defined in the Second Amendment) has been negotiated by the parties; approved by the Miami-Dade County Budget and Finance Committee on March 11,2004; and will be considered by the Board of County Commissioners on March 16,2004; and WHEREAS, the attached Second Amendment sets forth the following terms: . The County will remit a $15 million payment within ten days of the effective date of the Agreement; and . All reference to "baseball", including Paragraph C of the First Amendment, which requires the City's support of all County and State legislative initiatives related to the financing and development of the baseball stadium project, will be eliminated; . The County agrees to include a $55 million Convention Center Expansion Project in its proposed November 2004 General Obligation (G.O.) Bond Program; . Ifthe County's G.O. Bond Program is approved, the City will also receive a $45 million (capped) payment stream from 20% of the South Pointe Tax Increment, commencing October 1, 2005 to September 30, 2016, and continuing to September 30, 2017, at a rate of 45% if the $45 million cap has not been achieved, with said proceeds to be used by the City for eligible COT or Municipal Tourist Resort Tax uses; . If the G.O. Bond Program is not approved by the voters, the City will receive a $55 million payment stream from 20% of the South Pointe Tax Increment, commencing October 1, 2005 to September 30, 2016, and continuing beyond that date at a rate of 45% if the $55 million cap has not been achieved, with said proceeds to be used for the expansion or enhancement of the Miami Beach Convention Center; . Additionally, in either case: o All payments referenced above may be pledged by the City as security to fund capital costs, and the County agrees to cooperate with the City in any such bond issuance; o The forecasted COT receipts schedule will remain intact, which has, to date, not realized any payments due to the adverse impact of 9/11 (It is projected, based on new forecasts, that a revenue stream may be realized after 2020); o The City agrees to drop the pending claim processed under Chapter 164; o The Termination Date has been clarified as the latest of (a) September 30, 2040; (b) the latest expiration of any agreement providing for the pledge of COT receipts for the PAC; or (c) the latest expiration of any Agreement providing for the pledge of COT receipts for the baseball stadium. (It is anticipated that the PAC or baseball stadium financing is likely to last at least 40 years, which could result in an additional 5 year payment stream as contemplated by the terms of the Agreement); and WHEREAS, in addition to the points identified above, the County Manager has agreed to amend the Redevelopment Agency Interlocal Agreement to address the refinancing of certain existing debt within the City Center Redevelopment District and to address the payment to the County to offset costs associated with the administration of redevelopment agencies and a like payment to the City at fiscal year end; these Amendments would be presented to the Board of County Commissioners and the City Commission, respectively, for consideration at a future meeting; and WHEREAS, in that the attached Second Amendment authorizes the $15 million payment to be advanced from non-ad valorem general fund revenues; guarantees the inclusion of the City's Miami Beach Convention Center Expansion Project in the County's 2004 G.O. Bond Program; and provides an additional $45 million (if the County's G.O. Bond is approved) or $55 million (if the County's G.O. Bond is not approved) revenue stream from non-ad valorem general revenues over approximately the next 11-12 years, the City Commission should approve the Second Amendment. NOW, THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the Mayor and City Commission hereby approve and authorize the City Manager to execute a Second Amendment to the "Amended 1996 Interlocal" (as said term is defined in the Second Amendment) between Miami-Dade County and the City of Miami Beach. PASSED and ADOPTED this 17th day of March 2004 MAYOR ATTEST: ltfud' e~ CI CLERK JMG/CMC/PDW/rar T:\AGENDA\2004\Mar1704\Regular\lnterlocaI2nd AmendmentRES.doc NJIPR(NfIJNl1O FORM&LANGUAGI aFOREXECUllON ~~ '{.-/)"O'7' CIIr ~DIItI CITY OF MIAMI BEACH CITY HALL 1700 CONVENTION CENTER DRIVE MIAMI BEACH, FLORIDA 33139 www.miamibeachfl.gov COMMISSION MEMORANDUM From: Mayor David Dermer and Date: March 17,2004 Members of the City Commission Jorge M. Gonzalez \ .~ City Manager 0 ~ D DISCUSSION REGARDING A PROPOSED SECOND AMENDMENT TO THE INTERLOCAL COOPERATION AGREEMENT DATED JUNE 21,1996 BETWEEN MIAMI-DADE COUNTY AND THE CITY OF MIAMI BEACH. To: Subject: The Convention Development Tax (COT) is a three percent tax imposed on transient rentals that is authorized by State Statute. The State Statute sets forth that two-thirds of the proceeds shall be used to extend, enlarge, and improve the largest existing publicly owned convention center in the County. Thereafter, the two-thirds proceeds may be utilized for other eligible purposes set forth in the statute, including for stadiums, exhibition halls, arenas etc. In 1996, an Interlocal Agreement was entered into between Miami-Dade County and the City of Miami Beach regarding the disposition of the two-thirds portion of the COT which enabled the County to allocate COT receipts for the construction of the Performing Arts Center (PAC) and set forth various other business terms. In May 2001, as a result of the expiration of the March 31, 2004 deadline for the construction ofthe PAC referenced in the 1996 Interlocal Agreement, the parties executed a First Amendment to the 1996 Interlocal Agreement which provided, among other things, for Miami-Dade County to make certain payments to Miami Beach including a $15 Million payment due December 1,2003, which had not been paid, and a subsequent payment of $50 million due on May 1,2004, if a pledge for a Baseball Stadium had not been made by December 1, 2003. On February 4, 2004, the Mayor and City Commission adopted Resolution No. 2004-25484 authorizing the City Attorney and City Manager to institute the Florida Government Conflict Resolution Act process pursuant to Chapter 164 of Florida Statues regarding the non- payment of the $15 million. On February 28,2004 the City and County held the first formal hearing and at that meeting the County stated that the non-payment of the $15 million is based on the lack of available 2/3rds portion of COT receipts, due to prior obligations and commitments. At the joint meeting held on February 28, 2004, the County provided a schedule of current COT receipts and committed expenditures, evidencing lack of available funding for existing obligations, including the $15 million payment. Since December 2003, I have been in discussions with the County Manager to resolve these outstanding disputes. The following Agreement has been reached, and approved by the Miami-Dade County Budget and Finance Committee on March 11, 2004 and will be considered by the Board of County Commissioners on March 16, 2004. May 17, 2004 Commission Memorandum Inter/ocal Agreement - Second Amendment Page 2 of 3 The Second Amendment attached hereto sets forth the following: . The County will remit $15 million payment within 10 days of the effective date of the Agreement Le. 10 days after County approval or veto override, and upon City approval. . All reference to Baseball, including paragraph C of Amendment One to the Interlocal which required the City's support of all County and State legislative initiatives related to the financing and development of the baseball stadium project, will be eliminated. . The County agrees to include a $55 million Convention Center Expansion Project in the proposed November 2004 G.O. Bond Program. If the G.O. Bond Program is approved, the City will also receive: . $45 million (capped) payment stream from 20% ofthe South Pointe Tax Increment commencing October 1,2005 to September 30,2016, continuing to September 30, 2017 at a rate of 45% if the $45 million cap has not been achieved said proceeds are available to the City for eligible COT or Municipal Tourist Resort Tax uses. If the G.O. Bond program is not approved by the voters, the City will receive: . $55 million (capped) payment stream from 20% ofthe South Pointe Tax Increment from commencing October 1,2005 to September 30,2016, continuing beyond that date at a rate of 45% if the $55 million cap has not been achieved, for the expansion or enhancement of the Miami Beach Convention Center. Additionally in either case: . All payments referenced above may be pledged by the City as security to fund capital costs and the County agrees to cooperate with the City in any such bond issuance. . The forecasted COT receipt schedule will remain intact, which has to date not realized any payments due to the adverse impact of 9/11. It is projected, based on new forecasts, that a revenue stream may be realized after 2020. . The City agrees to drop the pending claim processed under Chapter 164. . The Termination Date has been clarified as the latest of (a) September 30, 2040; (b) the latest expiration of any agreement providing for the pledge of COT receipts for the PAC, or (c) the latest expiration of any Agreement providing for the pledge of COT receipts for Baseball Stadium. It is anticipated that the PAC or Baseball financing is likely to last at least 40 years, which could result in an additional 5 year payment stream as contemplated by the terms of the Agreement. . All other terms of the First Amendment remain the same. May 17, 2004 Commission Memorandum Inter/oeal Agreement - Second Amendment Page 3 of 3 In addition to the points identified above, the County Manager and I have agreed to amend the Redevelopment Agency Interlocal Agreement to address the refinancing of certain existing debt within the City Center District and to address the payment to the County to offset costs associated with the administration of redevelopment agencies and a like payment to the City at fiscal year end. Those agreements will be presented to the Board of County Commissioners and the City Commission for consideration at a future meeting. In that the attached agreement authorizes the $15 million payment to be advanced from non-ad valorem general fund revenues, guarantees the City inclusion in a 2004 G.O. Bond Program if it is placed on the ballot and provides an additional $45 million (if G.O. Bond is approved) or $55 million (if G.O. Bond is not approved) revenue stream from non-ad valorem general revenues over approximately the next 11-12 years, the City Commission should consider the proposed Second Amendment to the 1996 Interlocal Agreement in light of the constraints on the COT revenue stream. This proposed settlement agreement achieves two of our key objectives: (1) securing the immediate payment of the $15 million owed to the City's and (2) securing funding to accomplish the anticipated expansion of the Miami Beach Convention Center. JMG/C~/PDW Irar T:\AGENDA\2004\Mar1704\Regular\lnter1ocal 2nd Amendment.MEM.doc MEMORANDUM TO: Honorable Chairperson Barbara Carey-Shuler, Ed. D. DATE: and Members, Board of County Commissioners FROM: Geo'g. M. B",g",,~ County Manager SUBJECT: Second Amendment to Miami Beach Interlocal Agreement ~--- Recommendation It is recommended that the Board adopt a resolution approving, in substantially the fonn attached to the resolution, the Second Amendment to the 1996 Interlocal Agreement with the City of Miami Beach and authoring e its execution and delivery following approval by the County Attorney's Office. Backl!round The Convention Development Tax (CDT) is a three percent tax imposed on transient rentals. The CDT was approved, in part, to recognize the importance to the local economy of the continued maintenance, improvement, and expansion of the Miami Beach Convention Center. In accordance with state law, two-thirds of the CDT revenue was used initially for the extension, enlargement and improvement of the Miami-Beach Convention Center. Upon the completion of such improvements, the two-thirds portion of the CDT revenue may be used for other qualified projects throughout the County which has been the case since the initial financing for the Convention Center in 1987. The one-third portion of the CDT revenues was limited by the state law to use in the City of Miami. The one-third share of the CDT for use in the City of Miami was used for the Miami Arena initially and subsequently for various projects, including support for the American Airlines Arena and for the Perfonning Arts Center. In 1996, the Board approved an Interlocal Agreement with the City of Miami Beach, which clarified that the County could allocate the CDTreceipts for eligible projects, in particular, for support of the Convention Center and the Perfonning Arts Center. In April, 2001, the Interlocal Agreement was amended to provide for certain payments to Miami Beach including a one-time, CDT-backed $15 million payment for Convention Center-related projects (to be made from CDT-backed financing proceeds or available CDT funds on December 1, 2003), annual CDT payments of $4.5 million for operating costs associated with the Convention Center, additional annual payments from available residual CDT Receipts (Residual CDT Receipts Payments), annual payments through 2020 following the tennination of the South Pointe Community Redevelopment Agency, and a possible $50 million payment depending on the pledging of revenues to a baseball stadium. In return, the City agreed to the tennination of . . Honorable Chairperson Barbara Carey-Shuler, Ed. D. and Members, Board of County Commissioners Page 2 of 4 the South Pointe Community Redevelopment Agency (CRA) in 2005 as well as other provisions, such as a $2 million payment for books and materials at the new Miami Beach Regional Library. Subsequent to the approval of the First Amendment to the 1996 InterlocaLAgreement,the terrorist attacks on September II, 2001, and the downturn of the economy seriously reduced tourist tax collections, and collections of the CDT in particular. As a result, the City has not received any of the Residual CDT Receipts Payments envisioned in the First Amendment. In fact, even assuming the CDT grows at an annual rate of seven percent, the Residual CDT Receipts Payments to the City will not begin until approximately 2022. This loss of revenue affects the City's plans for the expansion and operation ofthe Convention Center. In addition, the financing for the Performing Arts Center planned for the Fall of 2003 has been re-scheduled for 2004 because of construction delays that slowed the expenditure of funds on- hand. Because of the reduced CDT revenue collections, there were no funds available to make the $15 million payment due December 1,2003. The County Attorney's Office indicated that the language in the First Amendment to the 1996 Interlocal Agreement limited the County's obligation to make such payment to available CDT Receipts. . On November 4, 2003, the County Commission approved the pledge of $35 million in CDT backed revenues to a new baseball stadium. As a result of that pledge, the $50 million CDT grant envisioned by the City to expand the Convention Center was negated. At the same time, the Board raised concerns regarding the loss of support for the Convention Center projects and provided that the CDT funding for those projects would be replaced if an agreement for funding the baseball stadium were not finalized. Considering the importance to the community of the Convention Center, I began meetings with the City Manager to develop a Second Amendment to the 1996 Interlocal Agreement that would address all the changes that have occurred since the approval ofthe First Amendment to the 1996 Interlocal Agreement. No agreement was reached by February 4, 2004, at which time, the City Commission voted to authorize conflict resolution procedures as required by the state regarding the payment of the $15 million that was to have been paid on December I, if funds had been available. The first mediation meeting was held on February 27. At the meeting, it was explained that the planned Convention Center Expansion Project was projected to cost in excess of $50 million, probably in the range of $55 million to $60 million. It was agreed that attorneys from the City and County would meet regarding the legal issues surrounding the use of the two-thirds share of the CDT and the debt service and other contractual obligations on CDT revenues. At the same time, City of Miami Beach Manager Jorge Gonzalez and I continued to discuss a compromise agreement that would be fair to both parties and would recognize both the reduction in CDT Receipts and the importance of the Convention Center projects. As a result of those meetings, the City Manager and I have agreed upon the following provisions: 1. The City will withdraw the pending claim processed under Chapter 164 of the Florida Statutes regarding the $15 million payment. 2. The County will pay to the City the $15 million payment that was to have been made on December 1, 2003, (if funds had been available) within 10 days of the effective date of the amendment. The source of the funds will be an advance to be reimbursed Honorable Chairperson Barbara Carey-Shuler, Ed. D. and Members, Board of County Commissioners Page 3 of 4 from a subsequent CDT-backed financing; in particular the financing that is projected to be required this year to continue construction of the Performing Arts Center and the Neighborhood Cultural Facilities, including the South Miami-Dade Cultural Center, the Coconut Grove Playhouse renovations, the Caribbea.T1 Market Place, the Lyric Theater, and the Civil Rights Museum. 3. The $50 million CDT obligation to the City would be eliminated from the First Amended Interlocal Agreement, regardless of the results of negotiations regarding a baseball stadium. Although the pledge of$35 million for the baseball stadium backed by CDT revenues is the maximum projected to be available for such a purpose at this time, future residual revenues and receipts above those currently projected could address other projects such as any increased costs associated with the construction of the Performing Arts Center or operating support for the Performing Arts Center and other museums. In the event that the baseball stadium project does not go forward, the $50 million commitment to the City could affect CDT support of those other projects. The requirement in the First Amendment to the 1996 Interlocal Agreement that the City of Miami Beach support initiatives related to the financing and development of a baseball stadium is also eliminated. 4. A $55 million Convention Center Expansion Project would be included in the general obligation bond issue to be considered by the voters in the fall. That project funding would replace the CDT obligation if successful. 5. In the event that the Convention Center Expansion Project is approved as part of the general obligation bond issue, the current payment schedule replacing the South Pointe CRA Tax Increment Payment would be increased from the current payment schedule (the equivalent of a 75 percent payment of the tax increment through 2016 and a fifty percent payment of the tax increment through 2020) to the equivalent of 95 percent payment of the tax increment until a total of $45 million more than required under the First Amendment to the 1996 Interlocal Agreement is paid to the City from non-ad valorem County sources or until September 30,2017, whichever comes first. Once the additional payments reach $45 million, or in 2018, the payment schedule would revert to that in the First Amendment to the 1996 Interlocal Agreement. The City could use the additional payments for any needs identified by the City, which needs are eligible uses for CDT or Municipal Tourist Resort Tax receipts. The additional payments would partially offset the loss of the annual CDT payments anticipated by the City in the First Amendment to the 1996 Interlocal Agreement. 6. In the event that the $55 million Convention Center Expansion Project is NOT approved as part of a general obligation bond issue in November, 2004, then the current payment schedule replacing the South Pointe CRA Tax Increment Payment would be increased to the equivalent of 95 percent of the tax increment until a total of $55 million more than required under the First Amendment to the 1996 Interlocal Agreement is paid to the City from non-ad valorem County sources. The City would be required to use those additional funds for the planned Convention Center Expansion Project. It is projected that the additional payments would be made through 2018, depending on the growth in the assessed values in the South Pointe area. Once the additional payments reach the level of $55 million, the replacement payments for the South Pointe CRA would revert to the schedule in the First Honorable Chairperson Barbara Carey-Shuler, Ed. D. and Members, Board of County Commissioners Page 4 of 4 Amendment to the 1996 Interlocal Agreement. Any additional funding required for the project or for project financing would be the responsibility of the City. 7. The payments to the City made as described in points 5 and 6, above, may be pledged by the City as security to rJ.ndcapital costs,- a.'1d the CbtL.'1ty agrees to cooperate\1Jith the City. 8. All other provisions of the existing Interlocal Agreement, as amended in 1996, will remain, including the requirement that the City pay $2 million to reimburse the County Library System for books and materials at the Miami Beach Library. 9. The Termination Date of the InterIocal Ageement is changed, regardless of any agreement concerning a baseball stadium, to the latest of (a) September 30,2040, (b) the latest expiration of any agreement providing for the pledge of CDT Receipts for the Performing Arts Center, and (c) the latest expiration of any agreement providing for the pledge ofCDT Receipts for a baseball stadium. In addition to the points identified above, the City Manager and I have agreed to amend the interIocal agreements with the City's Community Redevelopment Agency (CRA) to address the refinancing of certain existing debt as requested by the CRA and to address the payment to the County to offset costs associated with the administration of redevelopment agencies. Those agreements will be presented to the Board for consideration at a future meeting. While the business points of the Second Amendment have been agreed to, the final document is still under review, and some technical adjustments may be made. It is recommended that the Board approve the business points identified above and the attached agreement with the exact wording of the final agreement may be modified. It is recommended that I be given the authority to execute the final agreement when it is acceptable to the County Attorney unless there are substantial changes, in which case Board approval would be required. cmo04704 Approved Veto Ovemde Mavor Agenda Item No. RESOLUTION NO. RESOLUTION APPROVING SECOND AMENDMENT TO INTERLOCAL COOPERATION AGREEMENT DATED JUNE 21,1996 BETWEEN MIAMI-DADE COUNTY AND THE CITY OF MIAMI BEACH AND AUTHORIZING COUNTY MANAGER TO EXECUTE AND DELNER SAID AMENDMENT UPON COUNTY ATTORNEY'S APPROVAL OF ANY MODIFICATIONS WHEREAS, this Board desires to accomplish the purposes outlined in the accompanying memorandum, a copy of which is incorporated in this resolution by reference, NOW, THEREFORE, BE IT RESOLVED BY THE BOARD OF COUNTY COMMISSIONERS OF MIAMI-DADE COUNTY, FLORIDA that the Second Amendment to the Interlocal Cooperation Agreement dated June 21, 1996 betw'een Miami-Dade County and the City of Miami Beach in substantially the form attached as Exhibit "A" to this resolution is approved and the County Manager is authorized to execute and deliver the Second Amendment upon approval of any modifications by the Office of the County Attorney. The foregoing resolution was offered by Commissioner , who moved its adoption. The motion was seconded by Commissioner and upon being put to a vote, the vote was as follows: Dr. Barbara Carey-Shuler. Chairperson Katy Sorenson, Vice-Chairperson Bruno A. Barreiro Jose "Pepe" Diaz Betty T. Ferguson Sally A. Heyman Joe A. Martinez Jimmy L. Morales Dennis C. Moss Domn D. Rolle Natacha Seijas Rebeca Sosa Sen. Javier D. Souto Agenda Item No. Page 2 The Chairperson thereupon declared the resolution duly passed and adopted this day of ,2004. This resolution shall become effective ten (10) days after the date of its adoption unless vetoed by the Mayor, and if vetoed, shall become effective only upon an override by this Board. MIAMI-DADE COUNTY, FLORIDA BY ITS BOARD OF COUNTY COMMISSIONERS HARVEY RUVIN, CLERK Approved by the County ~~ to form and legal sUfficien~ By: Deputy Clerk RESO/OO404