City Attorney Quashes Jungle Island Loan Funding
Written by Risa Polansky on January 4, 2008
By Risa Polansky
Miami’s Omni Community Redevelopment Agency is off the hook for millions of dollars toward Jungle Island because attorneys ruled it illegal to use the agency’s funding to pay off the private tourist attraction’s troublesome federal loan.
City and Miami-Dade County Commissioners approved last month — and commissioners sitting as the agency board OK’d last week — a sweeping agreement laying out plans to fund several big-ticket items using redevelopment agency funds, including the Port of Miami tunnel and the hot-potato $25 million Jungle Island loan.
The county secured the Section 108 loan from the US Department of Housing and Urban Development to help move the then-Parrot Jungle from Pinecrest to Watson Island.
The wildlife attraction has long been unable to repay its share, and city and county officials agreed in 2006 after much grappling that the city would pay 80%.
Payments have come from the city’s general fund, but some officials hoped to pass the obligation off to the redevelopment agency, which gleans revenue by capping the value of real property and collecting the increment above it to fund area improvements.
Through the broad city-county agreement, officials decided to stretch the redevelopment agency’s boundaries to Watson Island, which would allow for funding of both the tunnel and, they thought, the Jungle Island loan.
But that is "no longer a possibility," said Assistant City Attorney Olga Ramirez-Seijas at a redevelopment agency board meeting last week.
She informed commissioners that outside counsel determined "it is not legally permitted" to use the agency dollars to repay a Section 108 loan.
Section 108 loans are designed to fund "economic development, housing rehabilitation, public facilities and large-scale physical development projects," according to HUD.
Anticipating a potential hiccup due to the nature of the loan, the global agreement included a clause that the agency would repay the loan "to the extent legally permitted."
This means, Ms. Ramirez-Seijas said, the agreement remains technically unaltered though the loan is out of the picture.
Commissioners at the meeting were incensed that the county seemed to have made changes to the agreement — unrelated to the loan — following the city’s approval.
It included a stipulation that the county would consider this month extending the date on which Overtown redevelopment area land would revert to county control, presumably to allow developer Crosswinds to create its city-approved mixed-income housing project.
County Commissioner Audrey Edmonson demanded as a clause to her approval of the agreement that commissioners take the land back, which would kill the project.
City Commissioner Michelle Spence-Jones said "I consider that to be a pretty big change" to the global agreement, but Ms. Ramirez-Seijas said the city always "recognized that possibility."
Though they approved the global agreement as an agency board 3-1, commissioners voted unanimously to hire an attorney to fight the reverter.