Don’t buy a pig in a poke in secretive courthouse proposal
Written by Michael Lewis on April 10, 2018
A mayor’s plea to scuttle an expensive, unsolicited and secretive bid for a new county courthouse is, for government, absolutely blistering. Rightly so.
Mayor Carlos Giménez trained all his guns on the offer tied to the owner of the Brightline rail line that is to link Miami to Orlando.
He wrote that accepting the unsolicited offer while the county is already calling for qualified candidates to do the job as the county wants it done would destroy all competition, resulting in naming the developer before prices, terms or details were ever negotiated.
That, as he states, would hamstring county negotiators. The developer, already chosen, would have no incentive other than goodwill to give us anything but the worst possible price, quality or timing.
That’s a hell of a way to run a railroad – or a government.
The report’s insight from both Mr. Giménez and consultant KPMG makes clear that even considering simultaneously with the county’s process the unsolicited offer from New Flagler Courthouse Development Partners would drive off competitors, making the new courthouse more costly at a smaller and worse site.
Far more perilously, from a good government perspective, New Flagler has invoked law that keeps secret the heart of its proposal. While the mayor and KPMG have read it and can respond, they can’t communicate details to either commissioners who will vote on the offer or the public that must pay for it.
“As a result, critical information pertaining to the financial impact and structure of the unsolicited proposal cannot be communicated in this report for the benefit of the Board [of commissioners] or Miami-Dade County taxpayers,” the mayor wrote.
That means commissioners either must vote blind to key facts or be “briefed” by lobbyists, but they can’t discuss or debate what that private lobbying covered. That will leave anything promised in private to the imaginations of voters who already distrust county hall.
New Flagler says it doesn’t want competitors to see anything because it put a lot of work into site plans, architectural designs, construction costs, the value it places on the current inadequate courthouse that it wants to take over, and more.
But New Flagler was never asked for a word of what it sent the county but wants us to keep secret. It did all that work voluntarily for an unsolicited proposal after the county was already targeting a very different deal. The mayor made clear that he didn’t want a proposal that undercut everything the county has been doing on a courthouse, yet the county is being forced by law to protect something it never wanted in the first place.
The New Flagler proposal thus becomes a “secret plan” to adopt sight unseen.
New Flagler did offer to allow a chosen handful of county judges who would benefit from a new courthouse to review its plans – but only if the judges also agreed to keep the facts secret.
That smacks of the disgraced Star Chamber, where from the 15th to 17th centuries English judges privately issued edicts based on secret testimony. Surely our judges would never be trapped into restoring that process, especially for their own benefit.
While the consultant read and analyzed the proposal, New Flagler’s use of confidentiality laws tied KPMG’s hands in advising the county what to do.
“Please note that certain findings, considerations, and observations from KPMG’s analysis have been redacted from the enclosed report, as directed by the County Attorney’s Office due to [New Flagler’s] confidentiality request,” KPMG told the county.
So KPMG submitted a four-section report in which we and commissioners can see only two sections.
Section 3 analyzed the financial ability of New Flagler to do the job and how its major participants are tied in. It said only “The findings, considerations, and observations from this analysis have been redacted in this memo as directed by the county attorney’s office due to [New Flagler’s] confidentiality request.”
So commissioners are asked to approve work by a company that might not have the funds to do what it promises. That alone should rule out the proposal.
Then we get to New Flagler’s financial model. This section compared New Flagler’s cost assumptions to the county’s, and compared the county’s ability to fund each plan. It also said only, “The findings, considerations, and observations from this analysis have been redacted in this memo as directed by the county attorney’s office due to [New Flagler’s] confidentiality request.”
Leave that out and commissioners are voting on blank checks of costs and revenues. That’s like the 2009 votes for a baseball stadium that wound up costing almost $3 billion including interest. The word “billion” was never uttered before the vote and commissioners got no financial data until two days after they had voted yes.
Again, that’s no way for the county to run a railroad.
The New Flagler proposal did contain details: a financial information summary, financial capacity industry benchmarks and financing assumptions. But for each of those three packages, KPMG again noted, “The findings, considerations, and observations from this analysis have been redacted in this memo as directed by the county attorney’s office due to [New Flagler’s] confidentiality request.”
Other than a secret proposal, what commissioners know as they discuss the courthouse this week is the key points of the mayor’s memo: the New Flagler proposal will cost more, it’s on the wrong site, and it will net the county far less when selling its outdated 1920s courthouse.
The mayor also warns that taking New Flagler’s offer would boomerang when the county deals on its public-private goldmine, the Smart mass transit plan, because serious bidders would opt out. After letting this cockamamie offer distort the courthouse playing field well after a call to compete based on the county’s vision, why should bidders risk that for transit too?
The mayor’s report, buttressed point by point by KPMG, makes it hard to fathom why commissioners would be swayed by New Flagler’s mostly-secret plan that deviates so far from what was sought.
Then again, it was hard to imagine why the county ever built a baseball stadium for $3 billion, and why nine commissioners voted yes. Even with Bruno Barreiro’s recent exit, though, some of those nine will still vote on New Flagler’s plan, which they already know will cost the county more and will boomerang on future massive public-private projects.
We have absolutely nothing against New Flagler – not that we know anything about them from the heavily redacted report that their secrecy required. Maybe they could win the courthouse bidding on a level playing field instead of setting their own rules.
And that’s all we can ask: a level playing field with all competing openly on what the county asks for. Commissioners, what could possibly be wrong with that?