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Front Page » Top Stories » After Tax Victory Miami River Marine Sector Looking Forward

After Tax Victory Miami River Marine Sector Looking Forward

Written by on November 13, 2008

By Shearon Roberts
Marine industry advocates hope the City of Miami will be more inclined to protect marine businesses on the Miami River following voter approval of a state constitutional amendment aimed at keeping rising property assessments from forcing the businesses to shut down.

The advocates say they want the city to reconsider changes to its comprehensive land-use plan that removed specific mention of the Miami River as a working port. City commissioners are to have a final vote on the changes today (11/13).

Known as Amendment 6, the constitutional change that voters approved Nov. 4 distinguishes land use for marine industry purposes from other uses for assessing property taxes.

"I suppose the property appraiser has to adjust its appraisal policies for working waterfronts" now that Amendment 6 has passed, said attorney Andrew Dickman, who has represented marine industry clients in cases against the city.

In Miami-Dade, 466,156 persons voted for the amendment and 202,694 against, says the Florida Department of State, Division of Elections.

Marine businesses along the Miami River say they have seen their property taxes more than double since commercial and residential real estate development began springing up along the river in the past five years. The rising taxes have threatened to put them out of business, they say.

Public support for distinguishing land use assessment for the marine industry still needs to be reflected through policies of the City of Miami, advocates say.

The city commission is to amend the Port of Miami River element of its Comprehensive Neighborhood Plan today. Those amendments would remove the word "port" as a designated use of the river, substituting mixed-use purposes for the land assessment of the river.

The commission began mulling these changes in May after losing three court cases that challenged moves toward residential development on the river. The rulings stated that the city violated its current comprehensive plan.

Marine proponents have said the 2008 amendments to the Port of Miami River element of the plan were an attempt to reflect the city’s new goals to pursue more real estate development. City officials have argued that residential development will help prevent further deterioration along the river and can co-exist with the marine sector. That rationale was the basis of the initial approval they gave the comprehensive land-use plan changes several months back.

The marine sector argues, on the other hand, that residential encroachment causes their land values to rise so high they can’t afford the taxes. Amendment 6 is seen as a way to reverse the loss of marine businesses on Florida’s rivers.

A majority of Miami commissioners endorsed the amendment in a resolution several weeks before the vote. Angel Gonzalez dissented.

The removal of the "Port of Miami River" language from the land-use plan has drawn opposition from the city’s Planning Advisory Board, the Miami River Commission, Miami-Dade County, the Regional Planning Council and the state Department of Community Affairs.

"The county already has favorable comprehensive plan policies for the river industry, although the city remains committed to condos anywhere and everywhere on the river," said Mr. Dickman, the marine sector attorney.

The city did make some changes to proposed land-use plan amendments to comply with initial concerns of the Department of Community Affairs. Current wording stipulates that development along the river "shall continue to provide for water-dependent, water-related commercial, industrial, and recreational uses along the river and provide for residential and mixed-use development, while acknowledging the presence of the waterfront industrial district along the river."

After today’s commission vote on the plan, the state is to conduct a final review.

The city wants to put another 25 acres on the river toward mixed-purpose use. Since 2002, new residential projects have sprung up, shifting 80 acres from decades of marine use to condos.

Advocates say the statewide vote has set the right tone for a more balanced approach to taxing industries.

"I think people misunderstood, after the bailout of the financial industry… that this wasn’t a bailout of big corporation, it’s more of a mom-and-pop bailout and it’s still about taxing business but according to its use so that is a balanced approach," said Fran Bohnsack, executive director of the Miami River Marine Group.

The Florida Taxation and Budget Reform Commission put Amendment 6 on the ballot. The state constitution authorizes the 25-member commission to review and assess tax structure, budgetary, revenue and expenditure procedures and government efficiency.

Voters favored the change by the highest percent margin of all the commission’s ballot amendments. It passed 70.5%, according to the Florida Department of State’s Division of Elections.

"We’re happy for the mariners and the boatyards, and they really need this relief," Ms. Bohnsack said. "Now the state Legislature is going to have to develop rules for the implementation of it so that it comes off as it intended."

Advocates are now looking to the city to see how it interprets the new amendment.

Mr. Dickman said the Legislature amended the Growth Management Statutes in 2006 to incorporate policies that protect working waterfronts. "Taken together, the constitutional amendment and the 2006 statute, there is a clear top-down policy in favor of protecting the marine industry," he said. "The missing piece of the puzzle, of course, is getting the city to see the light."

The city commission continues to debate the best land use for the river.

Commissioner Gonzalez has argued that segments of the river are blighted in his District 1, which includes much of the middle and upper river.

He favors development that could fill empty lots, get rid of derelict structures and bring in revenue for the city, along with the marine industry. He and other critics have also argued that local government could lose revenue streams as a result of tax structure changes.

The city pulls in far more tax revenue from residential development than commercial or industrial land use, city officials say. Michael Boudreaux, city director for Strategic Planning, Budgeting, and Performance, puts residential real estate tax revenue above $167 million a year, compared to $65.2 million for industry.

Economic experts, however, say that for every $1 raised in revenue from residential taxes, the city provides $1.15 in public services to these areas. Commercial and industry areas only cost municipalities 28 cents for services from each $1 in tax revenue, according to American Farmland Trust’s Cost of Community Service Studies.

Amendment 6 supporters say the marine industry on the Miami River accounts for 6,200 jobs, $682 million in annual economic output and $339 million in annual earnings, according to a 2005 study by the South Florida Water Management District.

The Port of Miami River is the fourth largest port in Florida based on cargo tons shipped, advocates said. The river’s 20 terminals were responsible for some $4 million in cargo moved in 2004.

"I see some potential where others see failure and fear," Mr. Dickman said.

"Dead condo developments don’t generate revenue even if the land is assessed higher," he said. "The Florida condo economy crashed, and there are some who say it started in Miami. A thriving working waterfront will expand the local economy and help make it less vulnerable to real estate cycles."

City Commission Chairman Joe Sanchez said he values the marine industry on the river. So far, however, he has supported removal of the port protection language from the land-use plan.

"The passage of Amendment 6 and the completion of the Miami River dredging should really prime the pump for marine industries on the Miami River," Mr. Sanchez said.

He did not indicate where the commission will come down today on the amendments to the comprehensive plan that will affect land use taxes of the industry. He said the city will work with the Department of Environmental Resources Management to revise regulations to allow dry stack storage of boats at appropriate sites on the river.

"I am exploring legislation," he said, "that will protect the development rights of riverfront land owners who agree to demolish derelict buildings and maintain clean green space until they redevelop." Advertisement