No More Footdragging Repay Miamians What Theyre Due
Written by Michael Lewis on April 27, 2006
By Michael Lewis
A change in Miami city managers should not be permitted to delay refunding of illegal fire-rescue fees.
The time is now. No more excuses.
The final barrier fell Friday. Miami-Dade Circuit Judge Peter Lopez ordered five persons who received a collusive city settlement — meant to void all claims by other rescue-fee payers — to refund the $3.5 million they’d gotten to date.
Thousands are due refunds. The judge has made clear that collusion to restrict payment to a handful won’t fly.
Now it’s time to repay those who rightfully merit it.
Mayor Manny Diaz has already promised the city will move to settle claims with attorneys for taxpayers. That should happen sooner rather than later.
But there is no need to wait for a formal settlement to do what’s right and issue the first checks.
The city inadvertently cheated taxpayers by levying a fee that Judge Lopez found unconstitutional in 2004. It then colluded, Judge Lopez ruled this year, to continue to cheat taxpayers by funneling a share of the amount owed to a small group although it was aware that the vast majority of citizens who had met what they though were obligations to the city would never get their money back.
Now, what possible doubt could there be that the city must immediately refund every penny? What’s to negotiate?
The city on March 31, 1998, set a fire-rescue fee of about $100 to several thousand dollars a year for each property owner. By that May, some had already sued, claiming the fee was illegal.
Several years later, the city altered the fee, leaving in doubt whether everything collected from that point forward was legal. But there is no question that for the prior three years every penny was taken unconstitutionally.
So, why shouldn’t the city immediately refund every illegally gotten penny? Lawyers can negotiate whether to refund more, or whether the city should pay interest on what it illegally took. Fine. Keep talking.
But refund now what everyone knows was taken wrongly.
Refunds, of course, won’t put the fiasco to rest.
Lawsuits are pending. The Florida Bar is investigating every attorney involved in the discredited settlement, from Mayor Manny Diaz to the city attorney’s office to the attorney for the handful of claimants who almost hit a $7 million jackpot, Hank Adorno. Indictments are possible.
But that is an unfortunate sideshow. It revolves around not a legitimate fire-fee refund but an illegitimate effort to settle with a few rather than paying all involved.
How much must be repaid? Mr. Adorno estimated $75 million. City officials started at $24 million, then said less.
But there can be no questions about the size of the city checks that must go out right now. No complex math. No negotiating. Those checks should simply total each taxpayer’s fee payments for the years in question.
How hard can that be? Not very.
How long should that take? No time, unless city tax records mysteriously vanish.
Where will the money come from? Property tax receipts, which are bulging as development balloons collections.
A refund is no surprise. It was required more than two years ago. But, if the city falls short, it can borrow against those growing tax receipts.
There can be no excuse for not acting now — certainly not the excuse that the city needs the money for other things. We couldn’t get away with that when we pay our taxes to the city. The city shouldn’t try that when repaying us.
The city, in fact, should be looking out for its taxpayers, the very taxpayers who stand to benefit from a refund and who are being cheated each day there is none.
Mayor Diaz has said Mr. Arriola will be replaced by June 1. The city must not wait until then to begin refunds that have been due for more than two years. Managerial change cannot become another excuse for delay.
The city should also not quibble about who will get how much. It’s perfectly clear: each taxpayer should get what he or she paid. If the city doesn’t voluntarily add interest, that can be negotiated later.
A judge has already ruled that collusion denied taxpayers justice the first time. There can be no excuse for foot-dragging in repaying them now.