On Second Thought

There will be a bottom to our real estate market but Tuesday offered a harsh reminder that it may still be a long way off.  Broward County is releasing preliminary estimates for taxable property values.  The ugly bottom line: a 16 percent drop countywide in 2009 based on sales data and deeper drops in some Broward cities.  We are still waiting for preliminary estimates from Miami-Dade.

Broward Property Appraiser Lori Parrish told me, “This is the biggest decrease I have ever seen in my adult lifetime and I have lived here almost 50 years.”  If that isn’t stunning enough Parrish offers another jaw dropping estimate. She said, “Over 50 percent and maybe over 70 percent of families in Broward are upside down on their mortgages.”

Property values have been plummeting for the last four years and the damage leaves very few homeowners and NO municipal government untouched.  Broward commissioner John Rodstrom will sit with his colleagues this year and face the unpleasant task of sifting through priorities and then making painful cuts.  He will not support raising taxes to cushion the blow and it is highly unlikely that any elected official would do so in this economic climate.  “It is like nothing we have seen before, “ Rodstrom said, “and we are probably looking at $145-$150 million in cuts again on top of $109 million last year.”

Everything, including a Broward Sheriff’s budget that is roughly half of the county’s $900 million dollar overall budget, will have to be put under scrutiny. Front line public safety efforts will likely escape the worst of a budget ax but the same cannot be said for other services. Broward commissioner Stacy Ritter told me, “They are devastating cuts (expected). The programs and services we provide won’t even look like this year…transit, parks, libraries.”

Even when the real estate market revives—and no one can predict that with certainty-- there will be years of navigating through the financial wreckage. In 2010 such is the harsh reality for South Florida property owners and government budget writers alike.

President Obama came to Tampa Thursday and told his audience he feels their pain.  “That is why creating jobs,” the president said, “has to be our number one priority in 2010.”

Some of those jobs will be created with federal stimulus money for a high speed rail line between Tampa and Orlando. If the project becomes reality the rail line could eventually be extended to Miami.  The announcement offered Mr. Obama a chance to build momentum for his agenda a day after his State of the Union address.

 Timothy Robinson is not impressed. He’s a mobile phone wholesaler in Doral and wishes there had been more emphasis on getting banks to ease credit and lending restrictions.  Robinson told me, “Hopefully they come up with a policy to help small business, maybe subsidize interest rates to help us move forward.”

Jobs may be job one on the president’s 2010 agenda but health care reform remains top of mind too. President Obama told Tampa voters, “I hope we can get some Republican lawmakers to join Democrats in understanding the urgency of the problem.”

John Alger understands just fine but the South Miami-Dade farmer bristles at the backroom deals that created a now stalled health care reform bill.  “Rammed through behind closed doors,” Alger complained, “it is wrong.”

President Obama acknowledged such cynicism among American voters.  He told lawmakers Wednesday night, “We face a deficit of trust, deep and corrosive doubts about how Washington works.”

There are other deficits too, like the one that threatens to bankrupt the federal government in the future. Lawmakers on both sides of the aisle bicker and delay making any tough choices for fear of losing the next election.  Alger offers them some simple advice that also passes as a warning. He said, “Boy, reduce the size of government. They are spending our children and grandchildren’s money before it is earned.”

It is precisely such frustration that has so many voters in an anti-incumbent mood, one that could reshape political and legislative landscapes from here to Washington this year. President Obama, like every politician, is trying to stay ahead of that wave of discontent.

The Miami Dolphins and the South Florida Super Bowl Host Committee would like to see Dolphin Stadium get a facelift. It’s one that would include a partial roof to keep fans dry while leaving the field open to the elements.  The NFL was not happy about the 2007 Super Bowl rainstorm here and apparently is saying the future of its marquee game in South Florida is in doubt without numerous stadium upgrades.

Super Bowl Host Committee chairman Rodney Barreto said, “We need to figure out what kind of improvements we can make to the stadium to make us competitive with other cities going after Super Bowls and Pro Bowls like we are.”

All of the concept planning is in the very early stages and boosters tiptoed around the biggest issued of all: the price tag.

Dolphins CEO Mike Dee said, “It certainly is not a plan we have figured out how it is going to be paid for.” He quickly added the Dolphins like the current stadium setup just fine. Dee told his audience, “This isn’t the Dolphins saying we need to have these improvements done to the stadium.”

The caution is understandable. One number being floated for proposed stadium upgrades is $250 million, money that could come from tourist/hotel taxes. The problem: the Florida Marlins have already dipped into that well for their new baseball park and got the money after a long, bruising battle that has generated enduring skepticism.  Sports fan Will Furry said, “I think we got ripped off with the Marlins stadium and it is getting out of hand.”

Such sentiment must be gauged in the months ahead. So too must the costs of losing money—hundreds of millions say boosters, far less say opponents—if Super Bowls come here less frequently or not at all, as happened with the 2013 bid for the big game. Former Dolphins star Nat Moore said, “The state of Louisiana made a commitment to the (New Orleans) Superdome and regardless of how great our bid was, we lost the bid.”

The Dolphins will move forward then,  knowing full well that they may wind up launching nothing more than a Hail Mary pass in the face of a public with little appetite for more public funding of big ticket stadium projects.

“All politics is local.”  That’s how legendary U.S. House Speaker Thomas “Tip” O’Neill  put it.  In 2010, though, the saying may be turned on its head. All local and statewide political races may be referendums on issues of national scope.  I was reminded of that when the A-list of Florida politicians, including four U.S. Senate candidates, showed up at a Coral Gables luncheon Monday.

Governor Charlie Crist was there. So was the surging challenger for the GOP nomination next year, former Florida House Speaker Marco Rubio. The Democrats turned out too. Miami congressman Kendrick Meek and former Miami mayor Maurice Ferre came to seek the support of the U.S. Cuba Democracy PAC (Political Action Committee). 

All four men sounded a hard line on Cuba policy aimed at trying to weaken Raul Castro’s hold on power. On domestic issues—national issues—they all know that health care reform being crafted in Washington will help shape their political fortunes.  Ferre said, “I think the economy is the issue and this (health care) is part of the economic debate and in that sense is important.”

Kendrick Meek won’t back down next year from criticism that health care reform will wind up being another huge, unaffordable federal entitlement, much like the multi-trillion dollar unfunded mandates for Social Security and Medicare. Meek retorts, “It will (bring costs down). Right now we have people who go bankrupt to pay for health care. We are the only country on the face of the Earth that allows that to happen.”

Florida’s leading Republicans call health care reform a blank check being written by Democrats. Miami GOP congressman Mario Diaz-Balart said, “We have two bills that do little other than bankrupt the U.S., cause health care costs to go up, and insurance premiums to go up.”

The Republican Senate hopefuls will wrestle with health care fallout and the larger economic crisis that has the state in its grip. Once a clear frontrunner, Charlie Crist is struggling to find his message for a battered state economy. He said, “Keep trying every single day whether it is a rail plan passed as we did last week, fighting for biotech (industry), diversify tourism industry as much as we can.”

Crist wishes he could erase the photo op with President Obama in Fort Myers last February, where he embraced the promise of federal stimulus money for the state. Marco Rubio—now surging into a near dead heat in one early GOP primary poll—will keep hammering Crist on that score, arguing he is the real conservative of the two. I asked Rubio if he would have turned down stimulus money to help Florida residents had he been in Crist’s position. He told me, “That is a false choice. That stimulus package was not about balancing the state budget. It was about creating jobs and we failed at that.”

Jobs, Cuba policy, health care reform and the exploding federal deficit.  There are so many issues that hang in the balance at the end of 2009 and will now shape the political drama on the horizon for Florida in 2010.

The pictures and the headlines blend together in an endless montage. That’s the 24/7 news cycle we live in. This week you’re as likely to see Tiger Woods dominating the headlines as you are to see President Obama outlining a stepped up offensive in Afghanistan.

“Tiger is the man this week,” said one fellow I talked to.  Yes,  talk of Tiger’s alleged infidelities make him the man—of attention or derision—for many.  It is a safe and sad bet that a lot of people know more about the details of the golfing king’s drama than the particulars involving 30 thousand American troops poised to beef up the offensive against Al-Qaeda in a mountainous, rugged and dangerous corner of the world.

One New York Times writer Thursday suggested the real world is too depressing and so many folks are willing to tune out.  Our South Florida economy has hit tilt, local politics is a revolving door but “Tiger” news is a titillating escape.

Another person I talked to shook her head over the focus. Lara Segredo said, “It is more entertaining to talk about Tiger Woods and his affair than the economy.”  She did not say she thought that focus makes any sense.

It certainly doesn’t make sense when everyone knows about Tiger Woods but many people can not name their elected officials—the ones who set our tax rates, police and fire services, classroom sizes, etc.  You get the point.

Judd Allison was having breakfast at Miami’ old S & S Diner when we chatted.  The sign outside the place says, “A Matter of Good Taste.”   There’s not enough of that these days for a sizeable--or is it dwindling-- number of people.  Allison said, “America needs to get its priorities straight. I think we seem to care more about Tiger Woods than what is going on overseas.”

George Bernard Shaw wrote, “The things most people want to know about are usually none of their business.” Maybe so, but that boundary was trampled long ago in our age of celebrity infatuation, instant communication, short attention spans, and ever growing apathy about public policy. Sooner or later the price for our sense of priorities-or lack of them—will come due.

A familiar face walked into Miami city hall Wednesday. There is a lot of that going on these days. Willy Gort—surrounded by family—filed his papers to run for a Miami commission seat.  “It was time for me to come back,” Gort said, “I’ve been away eight years and I’m fresh.”

Gort was a Miami commissioner from 1993-2003 and is taking another shot in a special election January 12^th. That is because a corruption case ousted District 1 commissioner Angel Gonzalez last month.  There is a lot of that going around these days too.  The District 5 Miami seat is also up for grabs in January because Michelle Spence Jones faces corruption charges she is fighting in court.  Suspended from office, she will try to win the seat back in the special election.

 One of her challengers last month, David Chiverton, will make another run too for District 5. The political novice figures he can win this time around. Chiverton said, “We need leadership that can get to work immediately and I can do the job.”

No wonder Miami City Hall is thinking about installing revolving doors—just kidding!  Remember, you have new commissioner Frank Carollo, the brother of former mayor Joe Carollo.  There’s also Francis Suarez, the son of another former mayor, Xavier Suarez.

If you fell asleep in the mid-90’s only to wake up today, you’d think no time had passed.  Even the budget crises have a familiar ring. The city could go broke now if it doesn’t deal with skyrocketing pension costs.   Miami fell off the financial cliff a decade ago, and state watchdogs came in to clean up the mess.

Family ties and old familiar faces are the storyline of volatile Miami politics for now, all vying to find safe passage through the brewing storm.  Whether they can keep a firm grip on the helm and rescue the city from financial and political calamity is the drama waiting to be told.

A budget crisis is grounding everything these days in Miami-Dade—programs, paychecks, and the jobs of county employees. Still, for all the hardship some commissioners are flying high. Their globetrotting trips defy the laws of financial gravity, and the quaint notion of showing concrete proof about the return on investment that taxpayers are entitled to have.

Those are the findings that made front page news in the Miami Herald Tuesday. The Herald documented $217,000 in taxpayer money spent on trade missions over two years, and the newspaper found nothing—in terms of new trade deals-- to show for the trips or the costs.

At least one commissioner disagreed. Rebeca Sosa and staff jetted to the Canary Islands in 2008. The tab to taxpayers-$21,000 and the commissioner said it was one case where dividends were paid.  Sosa said, “We were able to bring a direct flight, a new airline to the airport, Aero Europa.”

No such luck for Sally Heyman, who flew with fellow commissioners Audrey Edmonson and Natacha Seijas to South Africa in 2007. The bill came to $43,000. Heyman wanted to reopen non-stop flights to Miami but came away frustrated and now says such trade missions should be left to business professionals.  Heyman told me, “I voted against continuing the program (the travel program.)”

Heyman was outvoted on that score. Commissioners will keep funding the trade mission travel to the tune of $1.2 million next year.

Last month, the Herald found, Audrey Edmonson flew to Senegal and South Africa for 12 days with staffers. The cost to taxpayers hasn’t been tallied yet and Edmonson repeatedly refused our request for answers to basic questions like: is the trip worth the cost to taxpayers?

The biggest frequent flyer—by far—is Natacha Seijas.  Here’s a partial list for her and staffers: India at a cost of $28,000, a swing through Europe for $44,000, a trip to Japan and Taiwan this year at a taxpayer price tag of $34,000, and a recent trip to Brazil for $13,000.

If the payoff for taxpayers is coming from all those high flying pursuits it is not apparent yet. Oh, and Seijas, who routinely boast of her refusal to talk with reporters, wasn’t around Tuesday to be questioned. She was headed to Washington, D.C., on a business trip.

The party balloons came down and the reality check set in. On the day after his election victory, Miami mayor-elect Tomas Regalado hit the ground running. He met with city manager Pete Hernandez to talk about union pension costs. Those costs threaten to bankrupt the city Regalado will lead upon officially assuming his duties as mayor on November 11^th. After his meeting Regalado said, “We just planned a forum on pensions, a public forum on pensions for November 16^th.”

There will not be any solutions that day  but Regalado figures the unions and Miami residents need to understand the scope of the crisis—a $100 million pension obligation—that already eats up more than 20 percent of the city budget.  “Pensions are the main issue,” said the city manager.

In a low turnout election Regalado swept to an easy win over opponent and fellow commissioner Joe Sanchez, in part because of union support. Getting those unions to trim their pension benefits will be very hard.  Miami Police FOP president Armando Aguilar said, “I don’t think there needs to be any reduction in benefits. There are other ways of saving money.”

Tensions could build elsewhere too. Regalado sees the city manager as a staunch ally of outgoing mayor Manny Diaz. He spearheaded support for the Marlins stadium in Little Havana and other big ticket downtown projects that Regalado opposed. I asked if the city manager will keep his job. Regalado answered, “It’s a very difficult decision because I don’t know what has been going on in the city, and I hope he (Pete Hernandez) can explain it to me.”

Hernandez sounded an optimistic note. He told me, “We talk well and respect each other and can be a good team.”  That may be so but sparks will certainly fly over the Miami police chief, John Timoney. Regalado wants him gone, criticizing the chief for ethics lapses and perceived leadership failings. There was no response from Timoney’s office as this story was being published.

This much is certain. Regalado will need all the stamina he can find as he copes with issues--budgets, personalities and otherwise—in the political marathon now before him.

The fighting in Congress goes on over what health care reform should include, or whether the nation can afford an ambitious restructuring of one-sixth (1/6^th) of its economy.

In South Florida, meanwhile, the debate is personal for a stunning number of people.  U.S. Census Bureau figures show that one-fourth of the people between ages 18 to 64 in Broward County are without health insurance. In Miami-Dade more than one-third of residents in that age group have no health insurance safety net. Hialeah offers the most sobering statistics. More than half of the people there are uninsured.

Omar Sakedo is one face behind those numbers. He cannot find work and goes without health insurance. Sakedo said, “I had a hernia and had to have surgery done and they didn’t want to pay for it. It is rough when you don’t have insurance.”

Worse yet, health care experts say chronic illnesses turn into crises that send the uninsured to emergency rooms where they cannot be turned away. That is the most costly kind of care and someone ultimately pays the E.R. bill. That somebody is you, in the form of higher health insurance premiums if you are lucky enough to have coverage.

Martha Baker is a South Florida trauma nurse and is president of the Service Employees International Union.  Baker told me, “The chronic illness in this country sucks up 75-percent of our health care dollars. We need to decrease the money we spend on chronic care and spend more on prevention.”

Critics of health care reform proposals—which include preventive care provisions and a mandate that everyone has coverage-- argue the nearly one-trillion dollar, ten year price tag is unaffordable. They argue no one, including President Obama, has offered a clear, concise, precise explanation of exactly how to make sure such reform does not break the bank.

Health care reform supporters, meanwhile, say critics neglect the enormous costs of doing nothing to put health care on a sustainable footing in the U.S. Look no farther, they say, than your own soaring health care premiums, or to the friend or relative denied coverage for a pre-existing condition.

Baker said, “If we do not reform the system we have now, we all either die or go broke from the system. We must reform health care for the sake of the health of our country but also the economy of the country.”