(TNS) — After years of arguing and false starts, Miami-Dade is a vote away from approving a new $267 million civil courthouse in downtown Miami with a project already linked to revenue shortfalls in county budget projections.
Approving the winning bid by developer Plenary Group would finally hand Miami-Dade a financial path to replacing a courthouse so old that it once housed a trial for Al Capone. Miami-Dade would get a larger replacement next door to the existing 1928 courthouse on Flagler Street, a historic building that continues to be burdened by maintenance issues, closed courtrooms and complaints of dated, cramped facilities.
A final vote scheduled for Tuesday will apparently have to wait until a future meeting before the County Commission. The latest agenda states the courthouse item was removed from the day’s proceedings. The courthouse plan requires approval from the Federal Transit Administration since part of the proposed site, a parking lot under a Metrorail track between Flagler and Northwest 1st Street is tied to federal transportation funds. The FTA has not yet granted approval, so the vote was moved to the Dec. 17 commission meeting, a Plenary spokeswoman said.
The planned vote comes five years after Miami-Dade voters soundly rejected a proposed tax increase to fund a new courthouse, hampering financial options that the administration of Mayor Carlos Gimenez said still have not been resolved.
The new 23-story building would be constructed using private funds put up by Plenary, which then would operate the facility under a 30-year county contract worth an average of $27 million a year. In all, Miami-Dade expects to pay roughly $850 million to Plenary by 2053. The entity proposing the plan, Plenary Justice Miami, is part of Plenary Group, a developer based out of Australia with headquarters in Canada as well.
Under the novel arrangement — Miami-Dade’s first true “public-private” financial model for a county project — Plenary would see its yearly payments reduced if it falls short on dozens of operational and maintenance standards, including backup power not working during an electrical outage, failure to lower a courthouse flag during a period of public mourning, and falling behind on scheduled maintenance throughout the building.
The “P3” model, short for “public-private partnership,” is designed to link a developer’s profits with a project’s long-term functionality, since Plenary would receive less money if the 640,000-square-foot building performs poorly. Plenary Vice President Mike Schutt said the arrangement forces the company to invest in regular upkeep of the building long-term, rather than face financial penalties if conditions are allowed to deteriorate.
“There’s not really upside,” said Schutt, who works out of Plenary’s Tampa office. “There’s only mitigating downside.”
Miami-Dade plans to offer the existing courthouse for developers interested in transforming the historic building into a commercial use, such as a hotel or office building. The new courthouse will be larger, with 50 courtrooms instead of the existing 23.
The existing courthouse’s deteriorating conditions — including leaking exterior walls and air-conditioning flaws causing mold issues — were at the center of a campaign by the legal industry in 2014 to win public support for using a county property tax to borrow money for a $390 million replacement. That referendum failed by a nearly 2 to 1 margin.
Bertila Soto, chief judge of the Miami-Dade Circuit Court, said the building problems remain, with staff lawyers recently clearing out of their 19th-floor offices after suffering from breathing issues tied to mold. “It’s an old building,” she said. “It’s a continuous problem that won’t go away unless it’s gutted.”
Miami-Dade’s judges led the latest charge for a new courthouse, tapping the legal industry to help in a campaign to resolve a previous standoff between commissioners and Gimenez. The mayor had sought an alternate site next to the existing Children’s Courthouse to lower construction costs, but commissioners went with judges’ preferred location on Flagler Street.
Gimenez didn’t block the process but issued a memo in July warning of future service cuts to pay for the courthouse without improvements in Miami-Dade’s financial forecasts. Bidders had not revealed their prices at the time, and the Gimenez administration estimated then that it would have to pay a courthouse developer about $1.2 billion over 30 years.
With Plenary’s bid, the actual cost dropped by about 35%. In this week’s memo recommending the Plenary proposal, Gimenez did not address long-term revenue shortfalls that his top budget administrator said remain. The county’s current budget predicts an overall shortfall of $134 million by the time Miami-Dade makes its first courthouse payment of $25 million in January 2024, the building’s planned opening.
The courthouse is one part of that problem, along with soaring healthcare costs for county workers, increased transit expenses, and a loss of revenue tied to utility taxes.
A $25 million courthouse payment “is beyond what is available right now,” said Jennifer Moon, a deputy mayor who also serves as budget director. “But it’s not the only thing that’s beyond.”
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