Hallandale city manager’s going away gift of public money to departing commissioner

By William Gjebre, BrowardBulldog.org 

Hallandale Beach City Manager Renee Miller, ex-Vice Mayor Alexander Lewy

Hallandale Beach City Manager Renee Miller, ex-Vice Mayor Alexander Lewy

Thanks to Hallandale Beach City Manager Renee Miller’s generosity, former Vice Mayor Alexander Lewy collected a tidy gift of taxpayer cash after he quit the city commission last May before his term was finished.

To make it happen, Miller liberally interpreted a new and controversial city rule that commissioners’ enacted last year. The rule allows them to pocket thousands of unspent city dollars every year from their annual travel accounts.

“I made judgment calls,” Miller said when asked about the city’s $5,253 farewell payout to Lewy.

Miller said she decided Lewy was entitled to a payout even though he left his commission seat just seven months into the fiscal year. Likewise, she acknowledged hiking Lewy’s payout by raising his yearly travel account to $15,000. Commissioners’ standard travel budget per year is $10,000.

“I didn’t ask for it,” said Lewy, who quit to work for a lobbying group. He pointed out that he voted against allowing city commissioners to be paid for unused travel funds.

Lewy compared the travel fund payouts to other city benefits, like health insurance. “It’s not my fault that I benefited by it,” Lewy said. “I didn’t receive anything I didn’t deserve.”

Lewy said the commission authorized the increase to $15,000 as a way of providing additional funds for the mayor and commissioners who travel more on city business, but the approved resolution says each would receive $10,000 apiece. The city manager was also authorized to establish “an additional travel account” to cover such travel.

At the July 2013 meeting where the new travel policy vote was taken, Miller suggested $5,000 more for Mayor Joy Cooper plus an additional $5,000 for those traveling frequently on behalf of the city, according to city commission video.

In interviews, Commissioners Michele Lazarow and William Julian raised concerns about Miller’s payout to Lewy. Each said the city administration should have asked the commission’s approval before increasing a commissioner’s travel budget beyond $10,000.

“It was not voted up,” Lazarow said, adding the higher budget for Lewy “is a surprise.”

“It’s not right to get money if he leaves” before the end of the budget year, Julian said. He said the notion that anyone would leave early wasn’t contemplated when the policy was adopted.

Without consulting the commission, Miller said she decided to pay Lewy for unused travel on a prorated basis for the year. She also authorized $15,000 travel accounts for both Lewy and Cooper, who also voted against the travel payout police, because they were tasked with attending numerous local, state and national conferences and meetings on the city’s behalf.

When Lewy quit he’d only spent $3,497 of the $10,000 in his city account. Miller, however, pro-rated his payout based on a $15,000 travel budget.

The city manager’s calculations allowed Lewy to receive nearly $3,000 more than he would have had his benefit been calculated using the standard $10,000 travel budget.

In 2012-2013, both Cooper and Lewy traveled extensively on the city’s behalf, each exceeding their $10,000 travel budget. The commission approved an extra $5,000 for both that year.

Records show that through Aug. 18, Cooper had spent $10,814 in travel. If she spends no more by the end of the fiscal year on Sept. 30, she’ll be entitled to a payout of $4,186 from her $15,000 travel account. The fiscal year ends Sept. 30.

Here is the comparable travel spending for the three commissioners who voted to approve the travel policy. The number in parentheses is the current amount each would be due after Sept. 30: William Julian, $277 ($9,723); Michele Lazarow, $2,333 ($7,667); Anthony Sanders, $3,844 ($6,156).

Commissioner Leo Grachow, appointed by the commission in May to fill Lewy’s seat, has a $5,000 travel account this year. He’s spent $76, and stands to collect $4,924 after Sept 30.

 

9/11, Saudi Arabia and the search for answers amid government secrecy

By Dan Christensen, BrowardBulldog.org 

President Obama with Saudi King Abdullah at the White House in 2010; President George W. Bush with Crown Prince Abdullah shortly before he became king in 2005

President Obama with Saudi King Abdullah at the White House in 2010; President George W. Bush with Crown Prince Abdullah shortly before he became king in 2005

It’s been 13 years since al Qaeda hijackers commandeered four U.S. passenger jets and slammed them into America’s heart, yet a basic question persists: Did they act alone or with the help of a support network?

The answer is shrouded by government secrecy. Many believe that secrecy exists to protect oil-rich Saudi Arabia.

From the start, questions have simmered about the kingdom’s role in the September 11, 2001 attacks because 15 of the 19 hijackers were Saudi, as was Osama bin Laden. Congressional investigators and the 9/11 Commission stoked suspicion when they found evidence that at least some of the hijackers received direct financial support traceable back to the Saudi government.

The Saudis have consistently and strongly denied involvement in 9/11. Those denials, however, have been undercut by U.S. government documents – leaked or made public under the Freedom of Information Act – detailing the kingdom’s financial support for various Muslim extremist groups, including al Qaeda.

Here’s a candid assessment of Saudi Arabia’s dealings with external terrorists by then-Secretary of State Hillary Rodham Clinton contained in a secret December 2009 cable to U.S. diplomats that was made public by Wikileaks in 2010:

“Donors in Saudi Arabia constitute the most significant source of funding to Sunni terrorist groups worldwide…Saudi Arabia remains a critical financial support base for al-Qa’ida, the Taliban, LeT [Pakistan’s Lashkar-e-Taiba] and other terrorist groups, including Hamas.”

Such assertions, like others found in Treasury Department documents linking members of the Saudi royal family to charities supporting terrorist groups, take on new urgency with recent news about the kingdom’s financial support for the brutal Islamic State of Iraq and the Levant (ISIL), also known as ISIS.

Today, the heat is on in Congress and the courts to expose more information about the backdrop to 9/11. That includes obtaining facts about Saudi Arabia’s suspected involvement in funding the hijackers kept hidden by the administrations of two presidents – Democrat Barack Obama and Republican George W. Bush.

THE NOOSE TIGHTENS

“The noose is starting to tighten,” said former Florida Sen. Bob Graham, who chaired the Senate Intelligence Committee. “All of this points to the role of Saudi Arabia, over a long period of time, in some of the most horrific actions against the U.S., the people of the Middle East today and possibly the world tomorrow.”

In New York, a rejuvenated federal civil lawsuit brought by thousands of 9/11 victims and relatives promises to uncover a trove of primary U.S. and Saudi records.

9-11-01The Saudis had been dismissed as a defendant in 2005 after claiming sovereign immunity. But last December, in an unusual and complex ruling citing legal error, a federal appeals court in Manhattan reversed itself and restored both the kingdom and the Saudi High Commission for Relief of Bosnia and Herzegovina, its charity, as defendants.

The U.S. Supreme Court denied Saudi Arabia’s appeal on June 30.

To date, proceedings in the case have involved a number of Saudi funded charities, including the Muslim World League and its financial arm, the Rabita Trust, which was designated as a terrorist entity by President Bush a month after 9/11.

While some material produced by the charities has made it into the public domain via court pleadings, many other documents that were turned over are stamped confidential pursuant to a protective order entered early in the case by U.S. District Judge Richard Casey, according to Philadelphia plaintiff’s attorney Sean Carter.

“I can say with confidence that the discovery we’ve received from certain of the charities documents significant financial irregularities,” said Carter. “The documents confirm that certain money ostensibly distributed to branch offices for humanitarian projects was not applied to humanitarian projects.”

At the same time, the 9/11 families have a number of Freedom of Information Act requests pending – “some for many years,” said Carter.

SUSPECTED SAUDI AGENT

One request to the FBI concerns Dallah Avco, a corporate contractor with the Saudi Ministry of Defense and Aviation identified as a possible employer of Omar al Bayoumi. a suspected Saudi agent who befriended 9/11 hijackers Khalid al-Mihdar and Nawaf al-Hazmi in San Diego.

Bayoumi met the pair – who later died aboard American Airlines Flight 77 when it crashed into the Pentagon – shortly after their arrival in the U.S. after attending an al Qaeda summit meeting in Kuala Lumpur, Malaysia.

The FBI reply to that FOIA request was that it had no responsive records about Dallah Avco, yet Carter said an online search later found responsive documents posted in the FBI’s electronic reading room.

“To say the least, we are experiencing frustration,” said Carter. “The potential for litigation between the 9/11 plaintiffs and agencies of the U.S. government looms.”

Such a lawsuit would be a spectacle – thousands of 9/11 victims suing the United States to force the release of information about those suspected of responsibility for their injuries and the deaths of their loved ones.

But such lawsuits can achieve results.

BrowardBulldog.org is currently suing the FBI seeking records about its investigation of a Saudi family with ties to the royal family that moved out of their home in a gated community near Sarasota about two weeks before the September 11, 2001 terrorist attacks – abandoning cars, furniture and other personal items. Agents later determined that hijack ringleader Mohamed Atta and other terrorists had visited the home, according to sources.

The FBI, however, did not disclose the existence of that investigation to either Congress’s Joint Inquiry into the 9/11 attacks or the subsequent 9/11 Commission, according to former Sen. Graham, who co-chaired the Joint Inquiry. And when BrowardBulldog.org first reported the matter in September 2011, FBI officials said the probe had found no links to the 9/11 plot.

A subsequent Freedom of Information request was similarly met: The FBI said it had no responsive documents. Yet in March 2013, six months after the suit was filed, the Bureau unexpectedly released 35 pages. The heavily redacted records said the Sarasota Saudis in fact “had many connections to individuals associated with the terrorist attacks on 9/11/2001.”

80,000 PAGES UNDER REVIEW

Further small releases of documents have restated that finding and provided additional insights. Today, Fort Lauderdale U.S. District Court Judge William J. Zloch is reviewing 80,000 pages of records turned over by the FBI this summer for his private inspection to determine whether they should be made public.

“He could issue a ruling at any time,” said the Bulldog’s Miami attorney Thomas Julin.

Julin also represents the news organization in a separate administrative appeal requesting the declassification of 28 pages redacted from the Joint Inquiry’s 858-page final report to the nation. The pages concern “specific sources of foreign support” for the hijackers while they were in the U.S.

The appeal parallels a push by members of Congress to pass House Resolution 428, which calls on President Obama to declassify the 28 pages. The resolution says that declassification is “necessary to provide the American public with the full truth.

“These efforts to force the release of 28 pages of a 13-year-old investigative report by the House and Senate intelligence committees will disclose particularly the role of Saudi Arabia in funding 9/11,” said Graham, who helped write those pages.

9/11 Commission Chairman Thomas Kean, a former Republican governor of New Jersey, and Vice Chairman Lee Hamilton, an ex-Congressman from Indiana, offered their support for declassification when asked about it by Naples resident Matthew Sellitto during a public appearance on July 22 to mark the 10th anniversary of the commission’s report. Sellitto’s son, Matt, was on the 105th floor of Tower 1 of the World Trade Center.

9/11 COMMISSION MEMBER ‘EMBARRASSED’ BY SECRECY

“I’m embarrassed that they’re not declassified,” said Hamilton. “We emphasized throughout transparency. I assumed incorrectly that our records would be public, all of them, everything.

Still, the 28 pages remain secret despite efforts by numerous political leaders to have them made public. In 2003, for example, 46 senators signed a bipartisan letter to President Bush asking him to declassify the pages.

“If we are to protect our national security, we must convince the Saudi regime to get tough on terror. Keeping private its involvement – or that of any nation – in the September 11th attacks is not the way to accomplish that goal,” the letter says. The signers included Joe Biden, Sam Brownback, Hillary Rodham Clinton, John Kerry, Bill Nelson and Harry Reid.

For a CNN report Monday about the 28 pages, the Saudi government re-released a statement in support of their disclosure made by Saudi Foreign Minister Prince Saud al-Faisal in 2003 shortly after the Joint Inquiry published its censored report.

“We have nothing to hide. And we do not seek nor do we need to be shielded,” al-Faisal said. “We believe that releasing the missing 28 pages will allow us to respond to any allegations in a clear and credible manner; and remove any doubts about the kingdom’s true rule in the war against terrorism and its commitment to fight it.”

Following CNN’s Monday report, in which 9/11 relative Bill Doyle accused President Obama of breaking a promise to make public the 28 pages, the National Security Council issued a statement saying the White House had taken previously unannounced steps toward releasing the 28 pages.

“Earlier this summer, the White House requested that ODNI (Office of the Director of National Intelligence) review the 28 pages from the joint inquiry for declassification. ODNI is currently coordinating the required interagency review and it is ongoing,” said NSC spokesman Edward “Ned” Price.

Meanwhile, BrowardBulldog.org’s administrative appeal seeking release of the 28 pages is pending before the Interagency Security Classification Appeals Panel, which makes recommendations to the president after conducting what’s known as a mandatory declassification review.

The panel is not a rubber stamp. Last year, in its annual report to the president, it said it had reviewed 151 classified documents and approved declassifying 131 in whole or in part.

The panel’s six members are from the Office of the Director of National Intelligence, the National Security Council, the National Archives, and the Departments of Defense, Justice and State.

Broward to seek return of CRA tax dollars mishandled by cities; Millions at stake

By William Gjebre, BrowardBulldog.org 

Broward Administrator Bertha Henry and attorney and FAU professor Frank Schnidman

Broward Administrator Bertha Henry and attorney and FAU professor Frank Schnidman

Broward will seek the return of county property tax dollars from city community redevelopment agencies that hoarded that money instead of spending it on projects to fight slum and blight that are ready to get underway, according to County Administrator Bertha Henry.

The county’s toughened stand follows recent findings by Broward’s Inspector General that Margate deliberately mishandled $2.7 million in CRA funds. It also comes amid fresh criticism about the way Hallandale Beach allegedly handled its community redevelopment funds.

Frank Schnidman, an attorney and senior fellow at Florida Atlantic University’s School of Urban and Regional Planning, said in an interview that Hallandale Beach appears to have mishandled $12.6 million in CRA funds – an allegation disputed by a top city official.

“They lost track of the money,” Schnidman said. “They were not aware there were all these millions of dollars…they had misplaced.”

The County approves the establishment of CRAs after the need for redevelopment is studied and documented and contributes tax dollars – so called tax increment funding, or TIF – to the municipal agencies from revenue generated by the increase in property values in the redevelopment area.

Ten Broward cities have CRAs that receive TIF dollars. Others include Fort Lauderdale, Hollywood and Pompano Beach, have CRAs.

Henry said in an interview last week that the county will enhance its review of expenditures to make sure municipal CRAs don’t improperly bank funds at year end instead of spending them as required by state law.

“They now know they have to comply,” said Henry, referring to the Inspector General’s publicized findings.

Under state law, CRAs that have funds at the end of the year must spend that money on projects to be completed in three years, pay down debt or return it to the county.

INSPECTOR GENERAL’S PROBE

For months, the Inspector General has been conducting what appears to be a review of how some municipal CRAs in Broward have handled funds unspent at the end of each fiscal year.

In Margate, investigators found, the CRA mishandled funds by rolling them over from year to year without designating them for specific purposes. The Inspector General said the county could retrieve $2.7 million in funds provided to Margate.

Henry’s parallel review of CRA spending is expected to take two months. County representatives will then meet with CRA’s receiving tax increment property tax funds. For cities that don’t have projects ready to go, “I will recommend we go after the money,” she said.

Cynthia Chambers, director of Broward’s environmental protection department whose duties include overseeing municipal CRAs, will also be watching. She said the county would “certainly” seek the return of tax funds from CRAs that violate state law regarding the handling of year-end funds.

The Inspector General’s ongoing CRA probe began in 2012 after a string of stories in BrowardBulldog.org about questionable loans to local businesses and land purchases by Hallandale Beach. The 14-month investigation found $2.2 million in questionable CRA expenditures, the improper co-mingling of city and CRA funds dating to the CRA’s establishment in 1996 and poor record keeping.

The Inspector General also asked the city to tell it how much money the CRA had, suggesting the amount was uncertain. An audit by Hallandale Beach that in July, 2013 identified $12.6 million in CRA funds co-mingled with city funds.

Schnidman, the FAU professor and a former consultant for the Hallandale Beach CRA, was critical of the audit finding such a huge sum.

“They were not aware the money was there; they misplaced it. They were hanging onto the money…year after year,” Schnidman said.

The $12.6 million, Schnidman said, should be returned to the government agencies that, like the county, contributed property tax increase funds to the Hallandale Beach CRA – the city, South Broward Hospital District and Children’s Services Council.

Hallandale Beach City Manager Renee Miller disputed the notion the CRA had excess funds. “Anyone saying that is misleading the public. It’s not found money…not excess cash,” she said.

Miller said the audit went back to as far as 1996 to ascertain the amount of CRA funding, with interest. The money, she said, was then transferred to the CRA trust fund. Asked where the money was located, Miller said it was from current funding that year, not from any leftover funds from previous years.

Miller said the city had a good estimate of the amount of CRA dollars co-mingled with city funds, but the audit confirmed $12.6 million.

In the past when funds were co-mingled, Miller said it had been the city’s practice to account for CRA costs near the end of the budget year on September 30.

The $12.6 million CRA funds were used to pay agency costs during 2012-2013, according to Miller and city controller Melissa Cruz. Of that, more than $10 million went to pay salaries and benefits, administrative charges, debt service, utilities, material and supplies, repairs and maintenance, community redevelopment programs, grants to community groups, professional and outside services, subsidized loan programs, and other service charges. Another $500,000 was transferred to the city, and $2.3 million was designated for capital projects.

“It’s not as insidious as was inferred,” Miller said.

 

U.S. Sugar seeks OK for huge development after news it paid for GOP leaders’ trips

By Dan Christensen, BrowardBulldog.org sugarcane

Weeks after news that Gov. Rick Scott and Florida GOP leaders took secret hunting trips to Texas financed by Florida’s sugar industry, U.S. Sugar and Hilliard Brothers are pushing plans for a massive new development in rural Hendry County near the northwest edge of the Everglades.

The Sugar Hill Sector Plan envisions turning 43,313 acres – or more than 67 square miles – of sugar cane fields, citrus groves and pasture lands into a planned community featuring 18,000 residential units and 25 million square feet of space to accommodate manufacturing, warehousing, transportation services and other kinds of businesses.

Development would occur over the next 46 years, until 2060. No price tag for the project is mentioned in plan documents made public by Hendry County to date. Nor are financial arrangements discussed.

Maps indicate the Sugar Hill property is part of 46,800 acres of U.S. Sugar land the state has an option to purchase through October 2015 at fair market value under the Everglades restoration land acquisition program. Changes to Sugar Hill’s current agricultural zoning could significantly drive up the price per acre.

Various state agencies have been or will be involved in reviewing the giant project by the two Clewiston-based companies. They include Florida’s departments of Economic Opportunity, Transportation, Agriculture, Environmental Protection as well as the Florida Fish and Wildlife Commission and the South Florida Water Management District.

AN INITIAL THUMBS UP

The plan for Sugar Hill, which documents show has been discussed with various state and local officials since July 2013, appears on a fast track. The plan was formally submitted to Hendry County on June 2. The county commission gave its initial thumbs up last week by approving U.S. Sugar/Hilliard’s lengthy development application for transmittal to Tallahassee.

Under a law signed by Gov. Scott in 2011, the state’s sector planning program now lets local governments engage in long-term planning for large areas with minimal state interference. The same law abolished Florida’s Department of Community Affairs, which had overseen state growth management efforts and reviewed local comprehensive plans, and transferred its planning function to the newly created Department of Economic Opportunity.

The department had yet to receive the Sugar Hill application by late Tuesday.

A county planning and zoning document presented to commissioners before the Aug. 26 public hearing minimized the environmental impact of the Sugar Hill development. It says that an environmental analysis prepared by the sugar interests “confirmed that there are no regionally significant natural resources within the sector plan” area.

U.S. Sugar is looking for state support for the Sugar Hill plan in the wake of embarrassing disclosures by the Tampa Bay Times in July that it financed hunting trips to Texas’ King Ranch for Gov. Scott and Republican leaders. They include Agriculture Commissioner Adam Putnam; Former House Speaker Dean Cannon, R-Winter Park; Rep. Richard Corcoran, R-Trinity, scheduled to become speaker in 2016; Rep. Chris Dorworth, R-Lake Mary, who had been set to become speaker this year until he lost his bid for re-election; and House Appropriations Chairman Seth McKeel, R-Lakeland.

The paper reported that “since late 2011, U.S. Sugar paid more than $95,000 to the Republican Party of Florida for at least 20 weekend trips – destinations unspecified on public documents – within days of more than a dozen Florida politicians registering for Texas hunting licenses.” The industry also paid for the licenses.

The Sugar Hill property – shorthand for U.S. Sugar/Hilliard – is described as adjacent to the Airglades Airport, Clewiston and borders on the Glades County line.

BIG PLANS FOR A LITTLE AIRPORT

According to the county’s planning and zoning department, it “will incentivize businesses and development companies to locate in Hendry County by removing any barrier that may exist with the current land use designation. As important, this proposal would complement the future expansion of the Airglades International Airport.”

Hendry County's Airglades Airport Photo: U.S. Geological Survey

Hendry County’s Airglades Airport Photo: U.S. Geological Survey

Airglades is a small county-owned facility where British Royal Air Force cadets trained during World War II. Since 2010, the county has been seeking to sell the airport to private owners in order to turn it into a major hub for cargo shipments. The Federal Aviation Administration must approve any sale.

The airport is working with Airglades International Airport, LLC, (AIA) a private investor that wants to buy and privatize the airport as part of a $400 million plan that would turn it into an international cargo hub by adding a new 12,000-foot runway. AIA’s directors include U.S. Sugar executive Malcolm S. “Bubba” Wade Jr. and Joe Marlin Hilliard, chairman of the Florida Sugar Cane League.

On Monday, following FAA approval, AIA took over management of Airglades, said AIA President Fred Ford. He said the company expects a decision allowing AIA to purchase the 2,800-acre airport property “within the next 12 months.” The price to be paid would depend on how many jobs are created, said Ford.

According to Ford, the fate of Sugar Hill, which owns much of the land that surrounds the airport, is tied largely to the success of Airglades.

“If the airport isn’t successful, it won’t happen,” said Ford. “Sugar Hill is what could happen if the airport is successful…The sector plan could be just an interesting document.”

Miami developer hires governor’s pal; Scott, Cabinet green light Watson Island project

By Francisco Alvarado, BrowardBulldog.org 

Lobbyist William "Billy" Rubin, left, and Gov. Rick Scott

Lobbyist William “Billy” Rubin, left, and Gov. Rick Scott

In late March, state emails show, Florida’s Department of Environmental Protection was poised to pull the plug on a long-delayed, contentious plan to build a resort and mega-yacht marina on Miami’s Watson Island.

But developer Flagstone Island Gardens had an ace in the hole. A month earlier, the company hired Fort Lauderdale lobbyist William “Billy” Rubin, a longtime personal friend, business associate and political supporter of Gov. Rick Scott.

Within weeks of Rubin’s hiring, the DEP dropped its opposition to the estimated half-billion dollar resort project. Instead, Secretary Herschel Vinyard recommended the state waive a significant impediment: a deed restriction barring private development on Watson Island, land the state deeded to Miami in 1919.

Gov. Scott and the Cabinet unanimously approved the controversial waiver on May 19, state records show.

Such positive action by the state had seemed unlikely only two months before. At a March 26 meeting, top state environmental protection officials – including Deputy Secretary Katy Fenton and State Lands Manager Scott Woolam – had reiterated their opposition to the waiver to both the developer and the city.

“It became apparent to the city and Flagstone that a speedy flip of our longstanding position was not forthcoming,” Deputy General Counsel Thomas Sawyer wrote in an April 1 email to his boss and Fenton summarizing his department’s concerns.

Yet a speedy flip did come, and it happened in spite of objections from the Sierra Club, the Tropical Audubon Society, and Coral Gables lawyer Sam Dubbin, who represents Stephen Herbits, a condo resident on the Venetian Causeway who unsuccessfully sued the city to stop the project in 2004. In his complaint, Herbits argued Watson Island should only be used for public purposes and that the resort would block his condo’s view of downtown Miami.

Herbits, who used Florida’s public records law to obtain emails about the matter from both the state and the city said in an interview that lobbyist Rubin is the reason the waiver was granted.

‘ON INSTRUCTIONS FROM THE CAPITOL’

“Fenton, Woolam and Sawyer told us that the department had changed its position based on instructions from the Capitol,” Herbits said. “The developer sent in a lobbyist with direct access to the governor, who then shut the public out of the process.”

Florida Environmental Protection Secretary Herschel Vinyard

Florida Environmental Protection Secretary Herschel Vinyard

Rubin did not return phone messages seeking comment. But Flagstone’s lead lobbyist, Brian May, acknowledged that Rubin played an important role in convincing both Scott and Environmental Protection Secretary Herschel Vinyard that their client deserved to continue with its Watson Island development.

“I think Billy was very helpful,” May said. “No doubt, he did a great job.”

Gov. Scott’s spokesman, John Tupps, would not answer questions about Rubin’s role in securing the deed waiver, but provided this statement: “We trust the voters of Miami and the City Commission can decide what’s best for the development of Watson Island.”

Flagstone has fought to keep its project alive for more than a decade.

In 2001, Miami voters approved leasing prime waterfront land on Watson Island so Flagstone could develop its resort and marina. But 9/11 caused the first in a series of delays as Flagstone’s owner, Turkish businessman Mehmet Bayraktar, was unable to secure financing for the project. The real estate market crash in 2008 brought more problems as Bayraktar’s company was besieged by lawsuits and further delayed by dredging for the recently opened port tunnel.

Despite those setbacks, city commissioners and state officials granted Flagstone several extensions and lease modifications.

A rendering of Flagstone's Island Gardens on Watson Island

A rendering of Flagstone’s Island Gardens on Watson Island

In 2013, Flagstone announced it was teaming up with the Related Group to build a much larger version of the project. However, the partnership was short-lived as Related pulled out following opposition from Miami Beach city leaders about potential traffic congestion on the MacArthur Causeway.

Today, the site remains barren and overgrown.

As part of its agreement with Miami, Flagstone pays the city base rent of $2 million a year. Should the project get built, the city would also collect one percent of the revenues from the marina slips and two planned hotels and a shopping mall.

Herbits and other critics accuse the city of using outdated appraisals to determine those payments. Indeed, two recent appraisals conducted by the city found Flagstone ought to pay $7 million a year based on today’s real estate market.

After years of wrangling and delay, Flagstone and the city went to the Department of Environmental Protection in September 2013 asking help in securing the deed restriction waiver. They were met, however, by regulators’ concerns about the project’s viability after failing to break ground after more than a decade and Flagstone’s failure to pay off five court judgments it had earlier told the department it would satisfy by a January 2012 deadline.

Email traffic shows that environmental officials not only opposed the waiver, but wanted Miami to give the state 50 percent of the base rent instead of the 15 percent in the original agreement.

ENTER BILLY RUBIN

Months went by without any movement. Then, in February, lobbyist Rubin entered the picture.

Initially, the city wanted to retain Rubin to lobby on its behalf. On Feb. 7, Assistant City Manager Alice Bravo sent an email to Rubin saying the city was in the process of preparing a professional services agreement for him to sign.

Instead, Flagstone hired Rubin. Florida’s online lobbyist database shows he registered to lobby the executive branch on Feb. 19. He later reported Flagstone paid him between $20,000 to $29,000 for the quarter.

Rubin, owner of The Rubin Group, gave Flagstone the influence of a Tallahassee insider who was part the governor’s inner circle upon his election in 2010. Rubin helped select candidates for Scott’s transition team.

In the early 2000s, Rubin and Scott – along with then Broward Sheriff Ken Jenne – served together on the board of Cyberguard, a Deerfield Beach computer security firm in which both men had invested. Securities and Exchange Commission records show that Scott ultimately made more than $60 million from his Cyberguard investment.

The day Scott was elected, Rubin told the Tampa Bay Times that he’d met Scott in 1991 when the governor was building his Columbia/HCA hospital company. “We’ve stayed close ever since. I love him,” Rubin said at the time.

Rubin added that he would not benefit from Scott being in the Governor’s office. “I won’t be. I’ll quickly dispel that perception.”

In fact, Rubin is currently registered to represent 62 clients before the governor and executive branch agencies – including Flagstone and heavyweights like Florida Power & Light, Florida East Coast Railway and HCA Healthcare.

EVENTS MOVE FAST

Brian May, Flagstone’s other lobbyist, said the company retained Rubin because of his relationships with the governor and the Cabinet. He said it was done to counter Herbits and Dubbin’s efforts to stir things up at the Department of Environmental Protection.

“By the time we realized what was going on,” May said, “the best thing we could do is get Billy to lead the effort and get everyone to move forward.”

He added: “I am sure he spoke to the governor’s office since you don’t get on the cabinet agenda without talking to the governor’s office.”

Herbits disputed May’s version, noting that the department of environmental protection conducted its own research to determine that Flagstone had gotten a sweetheart deal.

“The state agency responsible for protecting the public interest was about to rule against the project,” Herbits said.

Spokeswomen for two Cabinet members, Chief Financial Officer Jeff Atwater and Agriculture Commissioner Adam Putnam, said that lobbyist Rubin did not meet with them or any members of their staff. A spokesperson for the third member of the Cabinet, Attorney General Pam Bondi, did not respond to questions.

Flagstone’s waiver request appears to have come before the Cabinet in May with unusual speed.

DEP counsel Sawyer’s email about the March 26 meeting says Deputy Secretary Fenton had informed Miami Assistant City Manager Bravo that placing the issue on the Cabinet’s May 13 agenda “was unreasonable” given that it usually takes three to four months to get an item on the calendar. He added that Fenton was “going to check the pulse of cabinet aides to determine if there is an interest in trying to rush this onto the May agenda.”

Herbits said he later was shocked to learn that Secretary Vinyard had not only put the Flagstone waiver on the Cabinet agenda for May 13, but had recommended its approval without mentioning his staff’s opposition. According to a transcript of the meeting, DEP staffers did not make any comments.

DEP spokeswoman Tiffany Cowie refused to answer specific questions about Sawyer’s email and Rubin’s involvement. This was her statement: “Based on the support of Miami’s voters and the city commission, the department brought this issue before the Florida Board of Trustees.”

According city administrators, Flagstone met a June 2 deadline to commence construction when the developer sent a diver to survey coral and other sea life that has to be relocated before dredging for the marina begins.

Scott campaign ad touting jobs record stars convicted smuggler

UPDATE 8/18: A spokesman for Gov. Rick Scott’s campaign said Monday afternoon that a campaign television ad touting Scott’s jobs program and starring a man convicted of human trafficking is no longer being aired.

“It was not pulled,” said Greg Blair. “The run simply ended” last week.

Blair’s comments came hours after BrowardBulldog.org published a story about the 30-second spot with Tampa grocer Maikel Duarte-Torres, who four years ago was convicted of smuggling in St. Maarten. Blair declined to answer any more questions.

By Francisco Alvarado, BrowardBulldog.org 

A Rick Scott television ad features the governor shoulder to shoulder with flag-waving smuggler Maikel Duarte-Torres

A Rick Scott television ad features the governor shoulder to shoulder with flag-waving smuggler Maikel Duarte-Torres

A Cuban-born grocery store owner starring in a Rick Scott Spanish language television campaign ad touting the governor’s job creation record was convicted on human smuggling charges in St. Maarten four years ago.

Maikel Duarte-Torres, who gives Gov. Scott a hug and a plug in the 30-second spot, is featured as a Florida success story.

“Four years ago, the economy was very bad. Rick Scott helped Florida’s economy and you can see the difference. He’s created jobs. That’s why I support Rick Scott. I’m just like him. I’m like the American Dream,” Duarte-Torres said in the commercial filmed during a campaign stop at his Tampa store in May.

Gov. Scott, his campaign staff, and the Republican Party of Florida were apparently unaware, however, that Duarte-Torres was arrested on Nov. 14, 2010, in the Caribbean nation for his alleged role in a smuggling ring that attempted to ferry 10 Cuban migrants from St. Maarten to Miami. Duarte-Torres was convicted five months later by a St. Maarten criminal court judge.

duarteHe was sentenced to two years in prison, but only served two days because of jail overcrowding on the island, according to Tineka Kampfe, a spokeswoman with the St. Maarten Attorney General’s office. Kampfe told BrowardBulldog.org that Duarte-Torres was allowed to return home to Tampa on the condition he never steps foot in St. Maarten again.

Duarte-Torres did not return three phone messages left on his cellphone voicemail. He also did not respond to a letter faxed to his business, MD Foot Market, located at 4019 W. Hillsborough Ave. in Tampa.

NO RESPONSE FROM THE GOVERNOR’S CAMPAIGN

Greg Blair, a spokesman for the Rick Scott for Florida campaign, and Susan Hepworth, a spokeswoman for the Republican Party of Florida, also did not respond to a list of questions emailed to them about Duarte-Torres.

David Custin, a Miami-based political consultant who has worked for Republican candidates running for state and federal office, says Scott’s campaign and the Republican Party should quickly cut ties with Duarte-Torres and stop running the ad, which began airing in the Miami market on local station America Teve in late July.

“It’s pretty bad to have the governor running an ad with a convicted human trafficker,” Custin says. “But if his people respond quickly and own up to what happened, then it won’t be as bad as sweeping it under the rug and not dealing with it.”

Duarte-Torres is a member of the “Small Business for Scott” Coalition, a group of more than 100 business owners from 67 counties who have endorsed the governor for re-election. In May, Scott and Lt. Gov. Carlos Lopez-Cantera made a campaign stop at MD Food Market, where Duarte-Torres flanked the two politicians as they fielded questions from local reporters.

Duarte told the Tampa Bay Times that his store employs 18 people full-time and that he dreams of owning a chain of MD Food Markets. “I started with a watermelon in my hand, selling fruits and vegetables on Lois Avenue,” Duarte said. “Things have grown from there.”

Gov. Scott and Duarte-Torres embrace in the Scott campaign ad

Gov. Scott and Duarte-Torres embrace in the Scott campaign ad

During the photo-op, a film crew also shot footage for the commercial featuring Duarte-Torres. The spot, paid by the Republican Party of Florida, shows the 32-year-old Cuban stocking items on the shelves, interacting with his employees, and giving in an interview in Spanish.

“The most important thing [in Florida] are jobs,” Duarte-Torres said in the ad. “Let’s continue working toward that.”

DETAILS ABOUT THE SMUGGLING

Duarte-Torres was the alleged mastermind of the human smuggling ring busted in St. Maarten. Several articles published by Today, the island nation’s daily newspaper, detail Duarte-Torres’ crime.

At his trial in March 2011, Duarte-Torres said that he traveled to St. Maarten at the request of a friend to deliver $2,000 to Erold Montgomery Bolan, a 64-year-old cab driver who assisted human smugglers in transporting illegal aliens from Haiti and Cuba across the Florida Straits. Duarte-Torres claimed the money was payment for moving two Cuban girls from St. Maarten to the U.S. Virgin Islands.

However, M.L.P. Ridderbeks, the prosecutor in the case, argued that Duarte-Torres played a larger role in a ring that had brought over ten Cubans to St. Maarten on a boat called the Braveheart. Ridderbeks said the migrants each paid $12,500 to the smugglers. Duarte-Torres maintained contact with Erold Bolan and with a Cuban woman known as “Adele” in St. Lucia to organize the transport of the 10 migrants.

Kampfe, the attorney general’s spokeswoman, confirmed Duarte-Torres was found guilty and sentenced to two years, but was released because there was no room for him in the local jail. Kampe provided BrowardBulldog.org with a birthdate and Tampa address for Duarte-Torres that matches records in background report on the MD Food Market owner.

Custin says it is unlikely the Republican Party or Scott’s campaign were aware of Duarte-Torres’ conviction. “It’s not a presidential or congressional race that requires a high degree of vetting and research before you use the person in an ad,” Custin explains. “They don’t do international background checks on people.”

Duarte-Torres has not been arrested for any crimes in Florida.

Holness: Margate isn’t the only city that’s mishandled CRA funds

By William Gjebre, BrowardBulldog.org 

Broward Commissioner Dale V.C. Holness

Broward Commissioner Dale V.C. Holness

In the wake of a critical inspector general’s report that accused Margate of mishandling millions of dollars in community redevelopment funds, Broward Commissioner Dale V.C. Holness says he expects similar findings of wrongdoing about other cities as the county’s investigation continues.

“Unfortunately, this is not the only CRA (Community Redevelopment Agency) handling it this way; others are doing it,” said Holness. “Funds should be utilized…to rid areas of slum and blight, reduce unemployment and help businessmen. CRAs are going for big projects that don’t help neighborhoods and small businessmen.”

The inspector general referred the matter to the Broward Commission “for any action they deem appropriate,” stating the county may reclaim as much as $2.7 million from Margate’s Community Redevelopment Agency (MCRA). The commission has yet to debate the matter.

But Holness, the only member of the nine-member commission to respond to requests for comment, said he’s more interested in the Margate CRA using the funds “the way though should be used, but are not” rather than focusing on reclaiming any mishandled funds.

Attorney Frank Schnidman, a CRA expert and senior fellow at Florida Atlantic University’s School of Urban and Regional Planning, also expects county overseers to find that other CRAs mishandled funds similar to Margate. CRAs have “not paid attention as to how to account for funds left over” at the end of the year, treating their funds “as another [city] account and not as a trust fund” to be maintained separately, Schnidman said.

The county’s findings gives it “leverage to bring Margate to the table to get them to comply” with state requirements through an agreement that would tighten accountability, Schnidman said. If no agreement is reached, the county “has the legal right to the return” of the $2.7 million in county property tax funds that the IG identified in its report.

Should the county take no action, commissioners would be left to explain “to the taxpayers not going after the money,” Schnidman said.

The inspector generals’ July 22 report found that the Margate CRA had “engaged in misconduct in connection with the handling of tax increment financing (TIF) funds it received from Broward County and other taxing authorities.” TIF funds come from taxes levied on the increased value of property in the designated redevelopment area.

“We found that the MCRA has a pattern of intentionally retaining excess funds for the later use of whatever unspecified matter it desired,” the report state. “The MCRA’s failure to appropriate the money in accordance with any legally prescribed alternatives has resulted in a debt to Broward County of approximately $2.7 million for the TIF monies contributed in fiscal years 2008-2012.”

Under state law, the report said, the agency must allocate excess funds to projects to be completed within three years, to reduce existing debt, or to place money in accounts to pay down future anticipated debt. Otherwise, end of the year funds have to be paid back to the county, the city, or the North Broward Hospital District – the entities contributing funds to the Margate CRA.

The report cited one Margate CRA official who informed his board two years ago that the agency “had roughly $10 million in cash that was not committed to any project.”

The county’s report said Margate CRA officials claimed that the funds were allocated to the long-awaited City Center project. However, the report concluded, “…evidence plainly shows that the MCRA has never appropriated a single dollars of annual excess TIF monies for that project.”

In its response to the inspector general, the Margate CRA asserted that it was in “compliance with the spirit if not the letter” of state law, asserting said it “did not hoard public monies for improper purposes.” It nevertheless offered to “appropriate money it ‘hoarded’ to a more specific mandated option,” according to the response prepared by Rachel Bach, a Margate CRA official.

The county’s report on Margate stemmed from an investigation started last September of 10 Broward cities and appeared to center on their handling of end-of-year funds. Other cities included Hollywood, Fort Lauderdale, Lauderdale Lakes, Davie, Pompano Beach, Deerfield Beach, Plantation and Coral Springs.

The probe followed a yearlong investigation of the Hallandale Beach CRA in which county investigators found the agency made $2.2 million in questionable expenditures. The Hallandale investigation and report, issued in March 2013, followed a string of stories in BrowardBulldog.org about questionable city loans to local businesses and controversial land purchase through the CRA.

The inspector general’s office also previously determined that Lauderdale Lakes misspent over $2.5 million in CRA funds.

Margate, like Hallandale before it, challenged the authority of the inspector general to investigate the city’s CRA.

“No report should be issued in this investigation, and if it is, it should be issued to the MCRA or the City of Margate, and not Broward County,” the Margate CRA stated in its response.

The Inspector General has dismissed that jurisdictional claim, stating it has the authority to investigate and asserting that it will continue to probe expenditures of CRA funds.

New law drives lobbyists out of the shadows at state water management districts

By Dan Christensen,BrowardBulldog.org 

The Everglades Photo: South Florida Water Management District

The Everglades
Photo: South Florida Water Management District

Florida’s five water management districts, special-purpose governments that collectively will spend $1.1 billion next year, have publicly registered 250 special-interest lobbyists since new registration requirements took effect July 1.

Until now, lobbyists seeking to influence spending and policy decisions at the water management districts operated in the shadows. The public had no way to obtain official information about them or their clients, or even know how many lobbyists were at work behind the scenes.

The new law requires lobbyists to register annually and disclose whom they’re working for. It is the first time state lobbyist regulations have been applied to any of the state’s nearly 1,000 independent special districts.

House ethics and elections chair Rep. Kathleen Passidomo, R-Fort Myers, has said that if the water district registration process goes well, the law may be expanded further to include other independent taxing districts such as the North Broward Hospital District, which levied nearly $150 million in property taxes in 2012.

BrowardBulldog.org, supported by a grant from the Washington, D.C.-based Fund for Investigative Journalism, reported in January that nearly all of the state’s independent special districts did not require lobbyists to register, pay fees or disclose any information about themselves or their clients.

A week later, Senate President Don Gaetz and Senate Ethics and Elections Committee Chair Jack Latvala announced their support for reform legislation that ultimately focused on the water management districts.

“Broward Bulldog’s reporting has helped raise the profile of the issue,” said Gaetz.

Today, water management districts are required to post lobbyist registration information on their websites.

The West Palm Beach-based South Florida Water Management District, which oversees water resources in the Everglades, is the state’s largest with a projected budget next year of $724 million. It collects taxes in 16 counties, including Broward and Miami-Dade, and is a frequent focus of lobbyists who engage staff and an unelected governing board dominated by real estate, agribusiness and development interests.

The SFWMD reported registering 104 lobbyists representing a variety of local governments, environmental and public interest groups like Audubon Florida, and large for-profit corporations.

Corporate interests include U.S. Sugar and the Sugar Cane Growers Cooperative of Florida, Florida Citrus, Walt Disney Parks and Resorts and ALICO, the Fort Myers-based agribusiness and land management company.

Lobbyist registration at Florida’s other four water management districts: St. Johns River, 55; Southwest Florida, 41; Suwannee River, 36; and Northwest Florida, 14.

SB 846, signed into law by Gov. Rick Scott in June, requires lobbyists to pay a $40 fee per client. Registration includes a statement from each principal authorizing the lobbyists’ work and identifying the client’s main business and a statement disclosing the existence of any direct or indirect business relationship between the lobbyist and any officer or water district employee.

Broward judge to hear Hollywood tenants’ claims for relocation assistance

By William Gjebre, BrowardBulldog.org 

Hollywood's Townhouse Apartments was demolished over the weekend. Photo: NBC6

Hollywood’s Townhouse Apartments was demolished over the weekend. Photo: NBC6

Robert Mattson, 18, was stunned when two shipmates were killed when their U.S. Merchant Marine cargo ship was attacked by mortar on the Saigon River while delivering ammunition to U.S. troops in 1969.

Now 63, Mattson says he was stunned again last December when he and fellow tenants at Townhouse Apartments in Hollywood, just off Young Circle, were forced out of their apartments on short notice to make way for a 25-story luxury high rise apartment-hotel complex.

“It was heartbreaking,” said Mattson. “Management was unprofessional and compassionless.”

Worse, he said, Hollywood did nothing to assist city residents displaced by a development that it is helping to fund.

“They treated people living there as though they were second class citizens. They want to build [Hollywood] up to look like South Beach,” Mattson said.

Another ex-tenant, Collette Curtis, 44, said that after she received her notice to vacate last September the complex’s manager was constantly “screaming and harassing” her to get her to move out. “It was terrible how we were treated,” she said.

Over the weekend, a decade after plans for a gleaming new tower were approved by City Hall, the 12-story Townhouse Apartments at 1776 Polk Street was demolished. Its end-of-the-line tale of gentrification is familiar: a rundown building in a rundown downtown area giving way to the promise of redevelopment.

Along with nearby properties, the 200-unit apartment building was designated as being located in a blighted area as defined under the state’s Community Redevelopment Act. Using that designation, the city can divert increased property taxes to developers to spur urban renewal.

But even as the dust settles, a legal tug-of-war continues as to whether the low and moderate-income tenants forced out of Townhouse Apartments are entitled to financial relocation assistance.

LEGAL AID LAWSUIT

Legal Aid Service of Broward County is pressing a class action lawsuit against both the city and the developer, Hollywood Circle LLC, claiming the ex-residents, including Mattson and Curtis, are owed that financial aid.

The defendants say they are not obligated to pay anything. They say residents were renting on a month-to-month basis – indicating that the building did not have a long life. City officials also contend that the fact that many tenants found new residences is proof that replacement rental units were available.

Legal Aid attorneys, however, contend that residents were forced out last December at the beginning of last year’s tourist season and had to pay higher rents or settle for less desirable housing. They also say residents are owed money under both state law governing the city’s use of community redevelopment funds for the project and applicable local law – a claim the city and the developer deny.

The next act in this drama will take place on Aug. 11 before Broward Circuit Judge John J. Murphy III who will hear from former residents, by affidavits or in person, about their plight. The judge will also consider Legal Aid’s request for an injunction to block construction of the hotel-apartment project until the issue of tenant relocation payments is resolved later.

Two former residents will not be testifying. They accepted cash payments of $15,000 and $4,000 from representatives for the owner of Townhouses Apartments to drop their legal action, according to court documents. Legal Aid attorney Sharon Bourassa believes two or three others may also have received financial payments.

After the two former residents accepted the payments, Legal Aid filed the class action lawsuit on behalf of the remainder of the tenants. It subsequently obtained a court order preventing representatives of the building owner from talking to their clients without Legal Aid attorneys being present.

THE NEED FOR FINANCIAL ASSISTANCE

Other former tenants, like Mattson and Curtis, say they had difficulties after moving without any financial assistance.

Mattson, a retiree receiving disability payments who lived at Townhouse Apartments for six years, had several hip operations before the tenants received notices to leave last fall. Because of his health, he had been trying to secure a lease on his $625-a-month apartment to make sure he had a place to be comfortable — but was turned down.

Wanting to get settled, Mattson moved in mid-November into a $595-a-month shared trailer off Sheridan Street, where he slept on a living room couch. In July, the widower moved in with his son and grandchildren in West Palm Beach.

Curtis, on the other hand, knew she could remain in her apartment until the end of the year despite the harassment because she’d paid the equivalent of three month’s rent – first, last and security – when she moved into Townhouse in November 2012.

“I told him [manager] to call my attorney,” she said. Still, she said, conditions went downhill. “The place was disgusting” especially at the end when maintenance stopped, including “spraying for bugs.”

Because she was studying to earn certification in technology studies, she didn’t have time to look for an apartment. With rents high in the area, Curtis said she moved to Williamsburg, Va., to stay with her mother.

In May, Curtis moved back to Florida. She’s now living in Sugarloaf Key, where she is working on and off in restaurants. She said she hopes to earn enough money to continue her studies.

Eanis Levinson, 68, a six-year resident, said she was also harassed by the building manager about when she planned to leave – to the point that she had to go to the emergency room “because of high stress.”

“I wish I was strong,” she said.

Levinson later found an efficiency apartment in a nearby house which she described as “a hellhole.”

She told her niece and her husband about her plight. The couple moved her to their city, Dothan, Alabama.

“I’m living in a two-bedroom apartment with central air,” Levinson said. “I have a beautiful apartment. No one is conning me. Thank God, in the end, it was fine.”

Looking back on her last days at Townhouse Apartments, Levinson said, “The residents were screwed. It’s all about money. We did nothing, but we were treated as peasants. The city did nothing.”

Gov. Scott, his investments and the ‘temptation to dishonor’

 

By Dan Christensen, BrowardBulldog.org pipe

When Gov. Rick Scott set up his first blind trust in April 2011, his lawyers asked Florida’s ethics commission whether he had any conflicts of interest because of his investments in companies doing business in Florida.

Topping their list of concern was Texas-based Energy Transfer Equity – the multi-billion dollar parent of various limited partnerships and subsidiaries engaged in natural gas operations, including pipelines and retail propane sales.

The lawyers wanted a conflict ruling about Energy Transfer’s propane business and its 35 Florida outlets potentially subject to state regulation, not its pipelines. The company and its affiliate, Energy Transfer Partners, had pipeline operations in “Arkansas, Arizona, California and several other states,” but not Florida, the lawyers told the ethics commission.

The commissioners, all political appointees of the governor, the senate president and the house speaker, saw no conflict.

“The (propane) business operation that exists in Florida is a small portion of the entire business activities of the (ultimate) parent organization, which is the organization in which the governor has invested,” said the commission’s May 2011 opinion. “Given the scope of the governor’s investment portfolio” his nearly $600,000 investment in Energy Transfer wasn’t “so proportionately large as to provide a particular “temptation to dishonor.’”

Less than two months later, however, Energy Transfer announced it would acquire Southern Union Company and its 50 percent interest in Citrus Corp., owner of the Florida Gas Transmission (FGT) pipeline. The $9.4 billion deal closed in March 2012.

“FGT is the principal transporter of natural gas to the Florida energy market, delivering 64 percent of the natural gas consumed in the state,” Energy Transfer’s web site says. The pipeline runs from south Texas through the Florida Panhandle and south to Miami-Dade.

Also in 2012, Energy Transfer Partners purchased Sunoco and its pipeline, refining and retail businesses for $5.3 billion.

GOV. SCOTT’S BETS ON ENERGY TRANSFER

Gov. Scott’s most recent financial disclosure form, filed in June, shows that as of Dec. 31 he continued to own a stake in Energy Transfer that he valued at $311,000. Additionally, he owned two other entities in the “Energy Transfer family of partnerships” – Regency Energy Partners and PVR Partners, which Regency acquired in March for $5.6 billion.

The governor valued his Regency stake at $194,000 and his PVR units at $207,000 as of Dec. 31. The total of all three of the governor’s Energy Transfer investments: $712,000.

BrowardBulldog.org reported last week that the governor’s portfolio at the end of 2013 included several million dollars worth of investments in the securities of more than two-dozen entities that produce and/or transport natural gas, including several that control Florida’s two main natural gas supply pipelines.

One investment, Spectra Energy, is in a $3 billion joint venture with Florida Power & Light to build Florida’s third large natural gas pipeline, the Sabal Trail Transmission in north Florida. Gov. Scott signed legislation last year to speed up permitting for the project and his appointees on the Public Service Commission approved it last October.

Many of Gov. Scott’s natural gas investments, including Energy Transfer Equity, are publicly traded master limited partnerships. Such partnerships pay no federal or state income taxes and are required to pay out all earnings to their limited partners – investors like Gov. Scott – that aren’t needed for current operations and maintenance. The investors are then taxed on those earnings.

Florida ethics laws generally prohibit public officials from having an ownership interest in companies that do business with the state or are subject to their regulation.

The governor holds his personal investments in a so-called “qualified blind trust” that by a state law the governor signed in 2013 allows public officials to hide their investment activity from the public while giving them immunity from illegal conflicts of interest.

The law seeks to “blind” the governor, a multi-millionaire, to the nature of his many holdings by requiring that he turn over control of his assets to a disinterested trustee. But BrowardBulldog.org has reported that the person overseeing the trust is a former longtime employee of Scott at Richard L. Scott Investments and that federal records show the trust has been ineffective in keeping the governor’s assets secret.

INVESTMENTS DISCLOSED

Gov. Scott made public his investments last month when he closed his original blind trust, then opened a new one into which he placed his investments.

The governor’s office has declined to explain that maneuver, but it was the first time since 2011 that Scott has released information about his investments.

Gov. Scott and First Lady Ann Scott’s 2012 federal income tax forms show the couple claimed a gain of $75,884 that year selling shares of Energy Transfer Equity and its principal subsidiary, Energy Transfer Partners. Total proceeds from those sales: $500,000.

Most of the Scotts’ 2012 gains on Energy Transfer, nearly $48,000, resulted from the sale of Energy Transfer Equity units that the couple reported had cost them nothing. A spokesman for the governor declined to elaborate.

The Scott’s tax returns list the sales of their Energy Transfer units separately from securities sales by the governor’s blind trust that netted about $1.3 million, but are not further identified. That accounting suggests the Energy Transfer units listed on the form were held in Mrs. Scott’s name.

The couple’s tax returns for 2013 have not yet been made public.

Gov. Scott and his staff would not be interviewed about his investments, including Energy Transfer. But a spokesman for his re-election campaign said via email that the governor has “no knowledge” of the contents of his blind trust.

Dallas billionaire Kelcy Warren, number #257 on Forbes’ list of the richest people in the world, is the chairman of both Energy Transfer Equity and Energy Transfer Partners, and chief executive of ETP. He has a reported net worth of $5.8 billion.

Warren is a big political supporter of Gov. Scott. Last November, two days after former Gov. Charlie Crist filed to run against Scott, Warren contributed $50,000 to Let’s Get to Work, a political committee backing Scott.

In March 2012, Energy Transfer subsidiary LaGrange Acquisition LP gave $25,000 to Let’s Get to Work.

Federal election records show that Warren has given more than $500,000 to mostly Republican candidates and causes since 2008.

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