Responding to questions about whether the City can move forward with the lease, City Attorney Raul Aguila wrote in a memo to Commissioners, the legal team has “concluded that the Lease cannot proceed without the sale of property, even though a majority of the City’s voters approved the Marina Lease.”
Aguila, however, provided two options for moving forward if the Commission wanted to proceed – re-negotiate the lease without the sale of air rights and a residential component and send it back to voters for approval or put a new question on the ballot regarding the sale that is either the same or modified to address resident objections.
Aguila explained his position on the two questions being tied together on this year’s ballot. “From the inception of the Marina Park Project transaction, the intent and understanding of all of the parties was that the proposed sale of property for the residential portion of the Marina Park Project and the new Lease for the operation of the Marina, was a package deal. The Marina Project would not proceed unless the voters approved both the sale and the new Marina Lease,” Aguila wrote. “This ‘meeting of the minds’ is clearly reflected in the various presentations to the City Commission; the numerous Commission Memoranda explaining the transaction; the City Commission Resolution approving the Lease; the Voter’s Guide; and of course, in the final agreements themselves.” [Emphasis in Aguila’s memo.]
Acknowledging the vote on the lease, Aguila wrote, “A clear majority – over 52% of the voters – approved proceeding with the new Marina Lease, which provided for construction of a new upland Marina commercial facility, at no cost to the City; delivery to the City of a completed 1.0 acre public park, at no cost to the City; $40 million in Marina improvements; and other improvements to the financial and other terms of the existing Lease.” The sale of air rights was rejected, though voters did vote on how to spend the $55 million in proceeds from the sale, a moot point with the rejection of the sale.
As we reported last week, Martin indicated he was interested in exploring options for moving forward with the lease and improvements after the split vote.
The two options presented in the memo for Commission consideration at its meeting on Wednesday:
Option 1: Modify the Lease (with no sale of property or residential component) and call a second referendum for approval of the modified Lease
Aguila indicated the City Commission “may elect to re-negotiate and modify the Marina Lease consistent with the November 3, 2020 referendum results, i.e., so that the Lease does not include any residential component and is not tied to any sale of property.”
This option would be subject to approval by the City Commission and approval by a majority of voters in a citywide referendum.
“The Developer has expressed interest in proceeding with this option at this time, should the City Commission be inclined to consider its approval of a modified Lease and hold a second referendum,” Aguila wrote.
“With respect to this option, it is important to note that although the structure of the documents was for a ‘package deal,’ the Lease itself contemplates the scenario that the residential portion of the Project could ultimately fail to materialize. The City and the Lessee have already negotiated terms – expressly set forth in the Lease – which would obligate the Lessee to construct an ‘Alternate Replacement Facility,’ with the mandatory elements for proceeding with a project to provide for the construction of a new commercial marina facility only, at no cost to the City, with the 1.0 acre public park and resiliency benefits,” the memo states. [Emphasis Aguila’s.]
“Accordingly, as much of the work for an ‘Alternate Replacement Facility’ has been pre-negotiated in the Lease, the Lease itself delineates a clear path forward, and can serve as the basis for the negotiation of updated lease terms and necessary modifications that would likely be required to the Lease, should the City Commission and the developer desire to proceed with this option.”
Option 2: Refine the Terms for the Sale of Property for the Residential Component and Call a Second Referendum for Voter Approval of the Sale of Property
In this case, Aguila wrote, the question could be “either on substantially the same terms as previously approved by the City Commission, or subject to any such changes as the parties may wish to make in an effort to address or accommodate objections or concerns previously raised by the voters,” Aguila said. “If the second voter referendum for the sale of property is approved by the City’s voters, a second referendum to approve the Lease would most likely not be required, as the Lease was already approved by the voters on Nov. 3, 2020.” [Emphasis Aguila’s.]
The next regularly scheduled election in Miami Beach is November 2, 2021 but the City could consider a special election. Given work is still going on at the Miami-Dade County Elections Department to finalize this year’s elections, the City Clerk has not ascertained when a special election might be scheduled or the costs, though it is anticipated costs would be approximately $300,000 for the special election with an additional $80,000 in required advertising costs. Further information on cost and scheduling is expected to be available at Wednesday’s meeting.
In the meantime, Aguila noted, “[T]he existing lease for the Miami Beach Marina remains in effect, and the foregoing will not result in any gap in the operation of the Marina.”
Mayor Dan Gelber who said he was “obviously disappointed” in the election results, indicated he is waiting to hear further from the City’s attorneys on how to proceed.
“I thought the Commission had put together, really, the best option that we could come up with,” he said. “I think there’s a lot of misinformation. People thought this was a giant building. It’s not. It would be the 7th tallest building in the area… Sixty luxury units would have zero impact on congestion.”
“A lot of the accusations, I think, were intended to scare people,” he said. Gelber sent the rendering above to voters in an email supporting the ballot questions. Since then, he said, people who voted against the sale said they wished they had seen the rendering prior to voting. “With all the heights and occupancies of all the other buildings, it’s obviously a relatively small building with no one in it.”
“If we don’t do anything, we’re stuck with a horrible lease and a tired, stale building and marina that desperately needs an overhaul and I thought that was a pretty good deal,” he said. Accusations of a “no-bid” deal he said, were wrong. “There’s not a bid to do when you’ve already leased the property for another 30 years.”
Martin partnered with current Marina operator Suntex on the lease extension proposal. Suntex is the current leaseholder with an agreement that runs through 2052.
“There’s some complexities to it and I understand that,” Gelber said. “I think we need to do something but I’m not going to fight… the public has to decide they want to do it. All we can do is give them an idea and let them do their work on it.”
Of the current lease, he said, “We gave away the farm and we’re stuck with it for another 30 years and there’s not going to be substantial upgrades.”
One of the key opponents of the sale and marina lease, Wayne Roberts, is advocating for the City "to press the leaseholder to live up to the agreement in place and modernize the existing structure to 'world class condition' as called for in the agreement or cancel the relationship entirely."
Another lead opponent, former City Commissioner Kristen Rosen Gonzalez, said "If the Miami Beach Commission puts this on the ballot after the electorate said no, I would lose all faith in our Commission. We have some great Commissioners right now, and I don't think they would be amenable to that."
The Commission item is listed as discussion item R9Z. It does not have a time certain. Aguila’s full memo is here.
final vote tallies:On the sale of air rights question, the final tally was 48.88% in favor (16,920) and 51.12% against (17,681), a difference of 768 votes.
On the long-term lease question, 52.36% (18,578) of voters said yes, 47.64% (16,904) no.
More details on the three ballot questions is here.
Rendering (top): Marina, proposed public park and baywalk, courtesy David Martin, Marina Park