Loading...
LTC 114-2008 Building Department and Planning Department Operating Proceduresm MIAMIBEACH OFFICE OF THE CITY MANAGER NO. LTC # 114-zoos LETTER TQ COMMISSION 0 =~ d -~ a, ~7 TO: Mayor Matti Herrera Bower and Members of the City Commission ~ ~ .~ : ~ ~ ~ FROM: Jorge M. Gonzalez, City Manager ' ~ -- ~ a ~ DATE: April 16, 2008 T ~ ,~.~ ~ SUBJECT: Building Department and Planning Department Operating Procedures o This Letter to Commission is intended to provide you with information relating to the recent arrests of City employees and the Administration's response. As you are aware, on March 19, 2008, two current employees and one former employee were arrested on charges of unlawful compensation and racketeering. The charges stem from allegations that these individuals accepted money and/or gifts from a developer in exchange for certain services for which they received direct compensation. Since that time, there have been several inquiries regarding the steps that the City takes to discourage and/or preclude this type of activity. Administrative efforts to preclude unethical and illegal activity typically take the form of processes that limit an individual's ability to solely control approvals. As it relates to the development process, our efforts are directed at limiting the ability for a single individual to be able to control all approvals necessary to obtain a building permit, or other approval necessary to develop a property. At the base of the development process is the individual inspection and the individual plan review, by discipline. There are a total of eight (8) disciplines in the Building Department, although not all permits may require reviews by all disciplines. In addition, review by Fire Prevention, Planning and Public Works may also be required on certain permits. There is little that can be done to control individual approvals, but strategies such as rotating inspectors and plan reviewers make it more difficult for one individual to be able to control or significantly impact the approval process independent of others. It should be noted that in some disciplines, such as Fire Prevention, rotating of inspectors and reviewers may not be practical. However, other strategies may be implemented such as precluding the plan reviewer from performing the inspections. As you are aware, a common element between the three individuals appears to be the developer who paid the funds and/or gave the gifts. It also appears, based on the information provided by the State's Attorney and by our internal reviews that, with respect to the plan review and inspection processes, none of the affected approvals impact the safety of any buildings. The money and gifts provided to the two Building Department employees appear to have been for expediting services and the requirements of the building code appear to be met. In order to provide some additional background and to properly frame the following information, it is appropriate to disclose that the City Administration was actively involved in this investigation, as well as the investigation of former Chief Electrical Inspector, Thomas Ratner, who was arrested for similar crimes in September 2006. It should be understood that in both cases, my office provided information to the Police Department, a department of the City of Miami Beach, in support of the investigations. My office fully endorsed and encouraged the criminal investigations of these activities and will continue to do so. Letter to Commission -Building and Planning Procedures April 16, 2008 Page 2 With regard to the Thomas Ratner arrest and conviction, my office received substantive allegations in the spring of 2006. I discussed these allegations with former Police Chief Donald De Lucca, who initiated the criminal investigation with Kathleen Fernandez-Rundle's Office at that time. Upon the arrest of Thomas Ratner later that year, I also directed staff to review and revise processes and procedures to preclude the types of activities in which Ratner was engaging. This effort later evolved into the Building Development Taskforce. Beginning in the winter 2006, and lasting into spring 2007, my office received complaints and allegations regarding Andres Villarreal. I requested that a Human Resources investigation be implemented, as these allegations tended to focus on activities covered by the City's Personnel Rules, as opposed to criminal infractions. As reported in the newspaper, these issues were regarding harassment of employees. During the course of the Human Resources investigation, allegations of a criminal nature were made by various individuals. This information was referred to the Miami Beach Police Department for appropriate investigation. I have continually taken the position that this type of activity is not acceptable and that we will pursue disciplinary and criminal actions/sanctions against any employee who engages in this type of behavior. BUILDING DEVELOPMENT PROCESS: Efforts to improve the Building Development process began in earnest in January 2007. A number of procedural improvements to both improve the development process as well as make it more difficult to inappropriately impact the system were implemented and additional improvements are planned. A number of the alleged activities (particularly in the case of the former Building employee) took place before many of the new procedures were in place and, as noted in the arrest affidavit of the current Building employee, the activities that took place after some of the improvements were implemented served to frustrate the efforts of this employee to cheat the system. Recent Improvements Below are improvements that have been put in place since January 2007, which are directed at preventing inappropriate behavior and aimed at decreasing the possibility that any individual is able to effectively complete permit or inspection approvals. These improvements were the result of the initial Building Taskforce Review and include deficiencies identified as part of the Thomas Ratner (former Chief Electrical Inspector) arrest. A/F Affidavit for Job Value and Total Gross Square Foofage: Creation of a new form, which requires execution by the Owner/Developer, Architect and Contractor, enabling the Building Department to verify and ensure that permit fees are assessed according to the fee ordinance and to establish accountability, and create an audit trail for the proper collection and assessment of permit fees. This step also requires a licensed, independent third party to certify the estimated job value and the gross square footage, which become the basis for the building permit fees. This procedure also creates a paper trail that can always be referred to during the process. Previously, this information in many cases was provided by the developer or owner and not verified. Overtime in Plan Review and lnspecfions: The Building Department's Administrative Staff reviews and approves all overtime requests. Through the creation of Plan Review and Inspection workload reports, the Building Department has been able to reduce unnecessary overtime and ascertain that plan reviews and inspections are performed during normal working hours as much as possible. In addition, overtime is assigned on a rotating basis by Letter to Commission -Building and Planning Procedures April 16, 2008 Page 3 discipline and in order to qualify for overtime, the staff must be at least as productive on overtime as they are during regular working hours. This reduces the opportunities for individuals to be able to directly influence the approval of a permit or project substantively. Within the Building Department, overtime review must also occur in the office. Previously, plans were allowed to betaken home by the reviewer and overtime hours were self-reported. In addition, overtime was self-selected by the reviewer and the customer, without review or question of the supervisor. With the current process, overtime must be assigned by the supervisor and checked out of the plans room. The time of review is supervised and tracked, and all of the work is done on City premises. Assigned Chief of Engineering to Oversee Building Department Plans Examiners and Monitor Workload Output: Once centralization of plan review occurred, it was necessary to oversee the distribution of the plans and to ensure that the proper processes were being observed. The Chief of Engineering is charged with ensuring that plan review is randomly assigned and to check for any suspicious activities or irregularities. Similar positions exist in the Inspections area of the Building Department, as well as in the Fire Department, Planning Department, and Public Works Department. In order to support this effort, a number of internal reports were created to track the progress of plans and individual plan assignments. On the Inspections side, we are currently implementing a laptop system which allows the results of an inspection to be entered into the system in real time. An added benefit of this is that the location and route of an individual inspector can now be tracked by the system. Until this system is fully operational, Inspector routes and their cellular telephones are presently posted on the City's website. Manual of Policies and Procedures (MPP) Draft: The development process departments have drafted an MPP. The purpose of the MPP is to define the development policies, procedures and processes to the general public in an easy, step by step manner. The MPP delineates the plan review, permitting, and inspection processes for the City's customers in order to facilitate their experience with the main development process departments. This document also includes ethical guidelines, such as the "Zero Tolerance for Gifts Policy" implemented in December 2007. Created Centralized Plans File Room: All plans are now kept in a centralized file room. The plans are organized by a master permit number, which are color-coded based on project types. In addition, project files are consolidated to include all permit applications, as well as all required documents for plan review. Previously, the customer had the responsibility to route their plans individually. Plans were kept by the customer and brought to the reviewer for the review. When the plans were being reviewed, the reviewer would either, keep the plans for review and call the customer when the plan review was completed, or review the plans while the customer waited. The former system offered many opportunities for an individual to significantly impact the approval process. By centralizing the storage and distribution of the plans, the ability for an individual to influence the process is reduced. Implemented Basic Security Protocols: Previously, there were no constraints on visitors to the Building Department lobby area, which serves an average of 250 customers per day. Customers were permitted to freely enter the Building Department from various places and visit with, any employee. There was no tracking of visitors to the department. A policy was implemented to preclude customers from entering the business areas unless being served, Letter to Commission -Building and Planning Procedures April 16, 2008 Page 4 and with a legitimate business purpose. By better defining the walkthrough process and only allowing access to the Plans Examiner one at a time when a ticket is called, contact between customers and Plans Examiners has been formalized and better organized. Additionally, Card Readers were installed to restrict access and to create a record of who activates the access mechanism. One Stop Shop: In order to facilitate the permit process for the customer, we have initialized the first phase of a One Stop Shop. This new procedure requires the submittal of three (3) sets of record documents to the Building Department instead of two (2); the Job copy, the Office Copy 1 and Office Copy 2. The Building Department will distribute Office Copy 2 to the Fire Department, Public Works Department and the Planning Department for plan review and approval. The extra set will enable PW, Planning and Fire to review projects simultaneously with the Building Department and will save the Customer the extra step of delivering the record sets to the other internal City Departments. This process also allows for better centralized control over the documents and also calls for a rotating assignment of reviewers where practical. Together, this process provides for greater accountability as the documents and the amount of time it takes per review is tracked centrally. This also means that owners/developers are no longer able to choose at their discretion who reviews their documents, as was the previous process. lmplemenfed "Security" controls within Permits Plus (Permits Plus is the primary software for the development process): Two of the main weaknesses of the Permits Plus system is that the system does not contain an "audit trail" function and the system does not have a sophisticated "security" system. Previously, none of the security parameters available within Permits Plus were activated. All fields, including those fields that determine fees and charges could be changed by any user at anytime. Complicating this problem was the fact that, as noted above, Permits Plus does not have an "audit trail" function. This meant that job value and square footages fields, which are the basis of the permit fee calculation, could be changed for the issuance of the permit and then changed back again by a single individual without the system recording that the changes were ever made. In addition, the fee field could also be changed, all without any audit trail. Staff has since implemented the security protocols that the software did contain, which applied some security in the job value and square footage fields. In addition, the system was modified to ensure that, once inputted, Permit Clerks can no longer change the fee screens and only the supervisor can perform an override. Based on these problems with the system, an internal audit of the Building Permit fee and revenue collection processes was implemented in May 2007 and is on-going. Some of the changes described within this LTC are the results of these findings. BuildFax: The City of Miami Beach has implemented BuildFax available online through the City's website. BuildFax provides building permit and property information from a single source. This allows the general public to access simplified property information in a matter of seconds rather than days. Using BuildFax will encourage customers to gain a better understanding of the permitting process. BuildFax can be accessed through the City's website at www.miamibeachfl.gov in Online Services, under the E-Government Tab. Letter to Commission -Building and Planning Procedures April 16, 2008 Page 5 Building Model Approved in January 2008: The previous Building Department staffing structure did not have a Finance Services Section with oversight of the permit fees and building revenue. The newly approved Building Department Model will incorporate a Finance Services section to the Building Department. In addition, the Building Model will modernize the organization of the department to greatly improve management oversight of individual activities. The model focuses on improving individual and team accountability, financial accountability, and performance. Conducted Mandatory Training Seminars ForEmployees: During 2007, all employees of the Building Department, the Planning Department, the Engineering Section of the Public Works Department and the New Construction section of the Fire Department were required to attend training sessions in the areas of ethics, diversity, sexual harassment and customer service. Staff worked closely with each of the training facilitators to ensure a customized training curriculum. The facilitators were instructed to use specific scenarios, which were provided by City staff, which are commonly associated within departments that serve regulatory functions. In addition, Building Department Management has reinforced City work rules and polices. For example, in order to address concerns relating to employee misuse of time card stampers, the Building Department added technology, ahand-reader, to verify employee time cards, and are now utilizing the workflow system in Permits Plus to track time spent on reviews and on inspections. Employee meetings have reinforced the City's Work Rules and reiterated the Administration's zero tolerance for inappropriate behavior. Future Improvements The following proposed improvements are still pending 7. Plan Review Checklist: We are in the process of creating Plan Review checklists to improve consistency between reviewers in each discipline. Checklists are commonly used in order to ensure that reviewers are focusing their efforts on the key elements of the applicable code. Checklists are intended to be published and provided to the customer to facilitate their submittals. The intent is to provide the customer with the key elements that we are looking for and to also provide reviewers with a consistent direction from the discipline chiefs as to what should be checked. This would also make it easier for both parties to identify behavior that is inappropriate. 2. Plan Review Guide: We are in the process of streamlining the Plan Review Guide for routing of Customers. The purpose of this document is to assist the customer in navigating the plan review process. 3. Permits Plus Improvements: We are in the process of defining and implementing Walk-thru's and Drop-Offs in the Permits Plus software. We are also in the process of selecting a successor software system to Permits Plus that contains proper security and audit controls. 4. CCTV Security System: A proposal was recently approved (January 2008) for a CCTV Security system in the Building Department lobby area. The system will provide a video record of transactions at the permit counter, including the payment of fees. 5. Posting of Inspector Routes in Real Time on the Internet: While this is primarily a customer service initiative to provide better information to the customer as to when an inspection may occur, it will also allow for better accounting of time for each individual inspector. Gaps in time, or inordinately long or short inspection times, can be reviewed with the employee, and if appropriate, the customer. Letter to Commission -Building and Planning Procedures April 16, 2008 Page 6 6. Employee Focus Groups: A series of employee focus groups is planned to specifically discuss with our employees any weaknesses and/or problems that they perceive with current controls. With this insight, we will address any remaining "loopholes" that may exist and allow someone to "cheat" the system. 7. Exploring the installation of GPS units in City vehicles and also activating GPS signals within City-issued equipment where appropriate. 8. Exploring stronger ethics policies and requirements for a!I employees involved !n the development process, such as increased restrictions on outside employment and the expansion of financial disclosure requirements to additional disciplines, such as Fire Inspectors. 9. Exploring the implementation of additional pre-employment checks (such as credit, ethics complaints, etc.) for potential employees, as we!! as the feasibility of routinely running these checks during the course of employment. 10. Exploring the implementation of a "hotline" to report unethical and potentially illegal acts by regulatory employees. This would need to include some type of investigation and findings capability. CONCURRENCY PROCESS- PLANNING DEPARTMENT: Concurrency is aState-mandated system, which ensures that all development that increases the demand for public facilities in the City will be served by adequate public facilities in accordance with the levels of service which are established in the City's comprehensive plan. Applications for development orders (building permits, certificates of occupancy and new licenses or certificates of use) must be reviewed by the City to determine their demand for public facilities, based upon the density and intensity of each proposed use. Credit is given for the level of existing development being replaced, and the net impact of the proposed new development is calculated. Concurrency applies to several aspects of infrastructure, including potable water, sanitary sewer, solid waste and storm water management facilities, parks and recreational facilities, and roads and transit facilities (Transportation). Transportation Concurrency is calculated for each proposed project using industry standard trip generation formulas, which assess various types of uses and predict vehicular traffic based upon the density and intensity of the project. Credit is given for proximity to transit routes, pedestrian pass-by traffic, and for mixed and shared uses. When a project is determined to generate additional vehicle trips, and thus impact the roadway network, a mitigation fee is charged, which is based upon the number of additional vehicle trips generated. The fee is assessed prior to the issuance of a building permit, or the approval of a new business license. The mitigation fees are pooled into separate accounts for North Beach, Middle Beach and South Beach. The funds are spent on transportation- related improvement projects contained within the City's Municipal Mobility Plan (MMP), such as roadway capacity, corridor enhancement and alternative transportation projects. One of the current employees arrested almost exclusively handled the City's Concurrency calculations. While related to the Building Development Process, and certainly a part of the Planning Department's development functions, this area of Concurrency calculation has been outside the scope of the Building Development Process improvement group, as the area does not affect life/safety functions, architectural elements, plan review or inspections. This area was closely reviewed in 2003, and was relocated from the Public Works Letter to Commission -Building and Planning Procedures April 16, 2008 Page 7 Department to the Planning Department at that time. With respect to this Planning Department employee, we have confirmed that the City was underpaid approximately $4,000 for the development located at 1434 Collins Avenue. This is the amount that this employee accepted. Although the arrest affidavit for this employee indicates that the developer believed that the concurrency fee for this property was $20,000, our internal review reflects that the fee was the approximately $10,000 that the employee charged the developer. Of this amount, the employee had the developer pay the City approximately $6,000 and the employee had the developer pay him $4,000. Staff continues to review other projects that have paid concurrency and so far have not found any other irregularities that suggest corrupt activity. While the staff and I are proposing several changes to the concurrency system that we intend to implement, I recommend that an external audit be performed of the concurrency system, including our proposed improvements. In order to provide an idea of the amount of concurrency fees collected, I have attached a chart representing our historic collections. In general, from October 1, 2000 through December 31, 2007, the City has collected an average of $1,356,916.28 annually in concurrency fees. Staff has examined the Department's existing procedures for administering the concurrency Management System. Several measures are proposed, which would modify the existing procedures to better ensure transparency and oversight. Previous Procedures: Previously, the day-to-day concurrency management functions were assigned to one individual staff member. The position of concurrency planner was filled by a Planner level staff member. The position functioned with a great deal of autonomy. Applicants for building permits, certificates of occupancy (C.O.'s) and licenses or certificates of use (C.U.'s), were directed to the concurrency planner, who took their information, calculated the amount of any required concurrency mitigation fees, and assessed those fees from the applicant. After payment of the required fees was made to the City cashier, the concurrency planner would enter the appropriate approvals in the computer and/or sign the applicable plans or application. All of these functions were performed by the same staff person. Supervision and oversight was provided by the direct supervisor on an as needed basis. When difficult, complex, calculations or controversial applications were involved, the supervisor would assist, or perform the duties necessary. Any complaints from the public were directed to the supervisor, who would investigate the situation and attempt a resolution. Regular oversight of general statistics and trends, and review of selected individual calculations was performed; however, each individual transaction or calculation could not be monitored due to the volume of transactions performed. Future Improvements: The following improvements are being implemented in order to eliminate the opportunity to influence the calculation of the required fees. Specifically, it is proposed that the function of concurrency fee calculation be separated from contact with the public, as follows: 1. Implement a two person system with a sfaff planner who handles the plan review and customer interface and have a concurrency planner that handles Letter to Commission -Building and Planning Procedures April 16, 2008 Page 8 solely concurrency calculations without direct interaction with the customer. The staff planner is the most knowledgeable about the project and is the face-to-face representative with applicants, either at the front counter, or for plans or applications dropped off. Staff planners are directly supervised by several senior staff members. In turn, it will be the staff planner's job to first review the accuracy of any concurrency application worksheet submitted, and then to route those requests to the newly designated concurrency planner assigned to concurrency calculations. The concurrency planner will consult directly with the staff planner, and will never have contact with the applicant or the public. That person will calculate the appropriate fees, based upon the information presented by the staff planner, review of plans, applications, and city records, as appropriate, and enter the amounts of the fees and how they were calculated into the Permits Plus plan review comments. A separate line item for concurrency review will be added to the building permit review screens in Permits Plus. When the appropriate fees have been calculated by the concurrency planner and entered into Permits Plus, the staff planner may then continue the plans review and relay that information to the applicant. It will also be available on-line on the Building Department's website. The concurrency planner will not have had any contact with the applicant. The concurrency planner will be designated from among Planning Department staff members who do not have responsibility for the review of plans or license applications. 2. Adjust the procedure for payment of fees by separating the payment of fees from the concurrency planner and moving this responsibility to a separate sfaff member. Previously, the procedure for the payment of fees was for the concurrency planner to fill out the applicable form, with the appropriate account numbers, and take the checks for the payment from the applicant. It is proposed that this function be assumed by the staff member who currently processes payment forms for various other miscellaneous fees (Office Associate). Only upon proof of payment, could the staff planner actually approve the plans or application for concurrency. The appropriate information would be entered into the staff planner's approval comments in Permits Plus, thereby providing yet another detailing of the calculation and fees associated with the concurrency approval. These comments would have to match the comments previously entered by the concurrency planner. This system would separate the calculation function from the public, and involve two staff members in the process instead of only one, thereby ensuring additional oversight and discouraging abuse. The handling of the payment process by the Office Associate adds yet another layer of oversight, and the required receipt from the cashier's office ensures that the proper amount was actually paid. 3. Relocate concurrency management system (CMS) computer function to a different department. The final step in this process involves the entering of the project data into the CMS computer. Entering the project data into the CMS computer fulfills the requirement of the State mandated growth management/concurrency statute, and keeps track of the amount of demand on the City's infrastructure, including roads, water, sewer, etc. Inputting the data into the CMS computer is necessary but does not have to be part of the permit and plan review process. This would give yet another person a chance to briefly review the calculations and transactions, perhaps catching errors or omissions if they occurred. It would add another set of eyes, from a different department, to the review and oversight process. 4. An external audit of the concurrency management system is recommended. I hope this provides you with a brief overview of the efforts that the staff and I have Letter to Commission -Building and Planning Procedures April 16, 2008 Page 9 undertaken over the past year to address deficiencies in our development process. It is important to understand that we did not wait for problems to occur. We have been proactive in addressing the weaknesses of our systems of which we were aware. The staff and I will continue to implement the best policies and procedures possible to ensure integrity in the system. We will continue by maintaining a reasonable balance between efforts to preserve integrity, while ensuring the system is not brought to a halt. While the actions of these three individuals should not and cannot be tolerated, I do not want to provide you with any recommendations that are not responsible and reasonable. For many years, the City has been criticized for not processing permits quickly enough and for not being able to inspect completed buildings with enough haste. Part of the reason why things take time is that we have an obligation to ensure that our buildings are safe and that the public objectives of the City government are met. While our goal is to complete our work more quickly and efficiently, and to process development efforts faster, initiatives to control independent actions and authority typically slow the process down in order to allow for review by another person or entity. I believe the improvements that we have made, as well as the ones proposed, are a responsible step in ensuring our residents and businesses that we will do a quality job in a professional and ethical manner. I look forward to discussing these issues with you at the April 16th City Commission Meeting Should you have any questions, please feel free to contact me. JMG/TH/cg C: Mayor and City Commission Executive Staff Tom Velazquez, Building Official Jorge Gomez, Planning Director Fred Beckmann, Public Works Director Sonia Machen, Fire Marshal ATTACHMENT TCMA -Mitigation Plan Endownment Schedule of cash receipts, deposits, net of refunds and other minor adjustments Prepared ; 4!2!2008 By: Finance Departmentlaw 158-8000 158-8000 158-8000 158-8000 341226 341227 341228 341229 Fiscal South Mid North Park & Year Beach Beach Beach Recreation Total 2000 628,405.77 27,702.55 18,000.00 - 674,108.32 2001 930,943.59 125,684.60 23,516.74 - 1,080,144.93 2002 589,309,95 92,432.38 72,965.11 13,481.75 768,189.19 2003 1,435,788.87 741,960.03 96,291.43 33,707,66 2,307,747.99 2004 496,916.94 248,117,85 24,892.57 37,834.62 807,761.98 2005 510,300.01 265,580.94 116,000.21 44,290.06 936,171.22 2006 968,696.78 199,607.78 382,965.64 129,315.14 1,680,585.34 2007 1,457,462,80 583,003.14 48,530.99 10,429.25 2,099,426.18 2008 673,263.42 130,150.18 31,720.58 5,290.00 840,424.18 Total 7,691,088.13 2,414,239.45 814,883.27 274,348.48 11,194,559.33 Annual Average 932,253.11 292,635.08 98,773.73 33,254.36 1,356,916.28 Total Mitigation 10,542,147.85 Total Parks & Recreation 274,348.48 Total Administration 378,063.00 11,194,559.33 Recording of collections begin in fiscal year 2000. 2008 includes only October 1, 2007 through December 31, 2007 so the total of $11,194,559.93 represents calander year collections in the aggreagate for years 2000 through 2007. Note: Amounts herein were taken from FMS and Eden Systems from years 2000 - 2008.