CRESPOGRAM REPORT
NOVEMBER 24, 2014
BARRED FROM NUMEROUS GOVERNMENTAL COMPUTER NETWORKS FOR TELLING THE TRUTH
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ANOTHER BAD DEAL FOR MIAMI
USING SCARCE ECONOMIC DEVELOPMENT MONEY IN SUPPORT OF A PROJECT DESTINED TO CREATE A MAJORITY OF LOW WAGE, PART TIME JOBS IS A MISUSE OF PUBLIC MONEY AND UNDERSCORES THE BELIEF OF MANY THAT WHAT MAYOR CARLOS GIMENEZ IS REALLY TRYING TO DO IS GIVE HIS PAL JEFFREY BERKOWITZ  $9 MILLION IN  “FLASH MONEY” TO HELP PRIME THE FINANCING PUMP FOR HIS TOWER
PART XXVI

Given the economically disruptive times we’re living in, it makes sense that politicians spend a lot of time today talking about economic development and job creation.


In many ways Miami is special when it comes to the issue of job creation because we have the third highest income inequality in the nation and parts of Miami reflect conditions in Third World Countries where some of the most affluent people in the world are living a stone’s throw away from some of the city’s very poorest people.


Miami also has an additional problem when it comes to job creation because an unusually high portion of the local economy is tied to the boom and bust cycles of real estate development that in turn is responsible for creating seasonal or project driven construction jobs.


According to City-Data, the construction industry, and construction related jobs leads the list of all the industries IN Miami, and is 8 percentage points above the 2nd place tourism and food service industries.

If Overtown didn’t exist, downtown real estate developers would need to create it, because hidden behind the promise of jobs for poor people are the real financial benefits that Overtown offers to developers: Overtown is designated as an Enterprise Zone, an Empowerment Zone AND a Targeted Urban Area, all of which collectively represent millions in potential tax breaks and other economic benefits for those developers building anything within the extended boundaries of Overtown.


As part of his effort to raise over a quarter of a billion dollars from foreigners - mostly from Chinese investors - seeking a Temporary Visa to enter America, Jeffrey Berkowitz, like many other developers around the country sought to create his own EB-5 Regional Center, and as part of that effort he wrote Congresswoman Federica Wilson seeking her assistance in getting the USCIS to expedite his request.

It is understandable therefore that time after time when developers or their lobbyists show up at Miami City Hall or at County Hall looking for some sort of sweetheart deal that will allow their latest project to move forward, they predicate their request for public money, or public land, or variances from the building code, or desire to pay less than the going rate for these, or other public services by invoking all the good that they will do for the poor Black people in the ghetto, who will be the first to get jobs on these projects.


Here is an example of how this works.


Below is a snippet from a Miami City Commission meeting last May where lobbyist Brian May, representing the developer of the Flagstone/Watson Island Resort and Mega Yacht project, showed up to promise on his client’s behalf that after close to a decade of inaction, they planned to start construction by June, and then he went on to talk of the benefits that that would bring.


It should be noted that Brian May became the lobbyist for Skyrise Miami in September, shortly before the efforts of Jeffrey Berkowitz to get $9 million from the Miami-Dade County Commission was revealed.

The Mayor’s statement basically restated the language in the resolution that said:

Of course, like the argument over whether Jeffrey Berkowitz misled the taxpayers of Miami with his, “Skyrise Miami is not looking for one nickel, not one penny of City of Miami support,” in his comments to the Miami City Commission in June, he also told them that his tower was going to generate 900 jobs.

Berkowitz restated this claim, even going so far as to claim that these 900 hundred jobs would make Skyrise Miami one of Miami-Dade County’s Top 20 employers in the letter that he wrote to Mayor Tomas Regalado in October demanding that the Mayor apologize over the statements he had made when it was revealed that Berkowitz was asking for economic development money from the County’s Project 124 Bond program.

Unfortunately, when this item was first revealed in the County Commission’s agenda for he November 5th meeting, as well as now in the agenda for the November 24th meeting, the PDF that accompanies the announcement of this item in the agenda does not include a copy of the Application submitted by Berkowitz Development Corporation for the $9 million in economic development money.

This is disturbing because one could readily conclude that this was not an oversight, but was done purposely.  if you look at the Commission agenda for November 24th meeting, you will see the item that precedes the Skyrise item for a rehearing is the controversial Larkin Health Sciences Campus item. As controversial as that item is, its PDF link includes the Application submitted by the Larkin Health Sciences LLC on May 23, 2013. You can see the entire agenda item, including this application by clicking HERE.


So why wasn’t the Application for Skyrise included as part of its PDF?

The history of withholding important and revealing financial documents on items coming before the County Commission I’ve been told has long been a shameful strategy intended to keep the public in the dark, especially when it comes to items such as this one, where $9 million in public money is being sought by a close friend and campaign contributor of the Mayor through a questionable and politically motivated process.


WHAT ARE THEY TRYING TO HIDE


First off, it took over two hours of walking around the County building, and being directed to 3 separate offices before I was able to get a copy of the Berkowitz Application. 


You can look at the Application and a copy of the economic study that Jeffrey Berkowitz’s company had done by the Washington Economic Group by clicking HERE.


The most important revelation in the application, and the one that the members of the County Commission should focus on, especially since they were denied the opportunity to do so by the Mayor and his staff through the failure to provide this information as part of the PDF packet for this request, can be found on Page 8 of the application, under JOB AND WAGE OVERVIEW.

All of the job occupations, average wage and average benefits highlighted above in every color but YELLOW are part of the 571 jobs described in the Resolution, and can be found on Pages 1-3.


The jobs, wages and benefits highlighted in YELLOW are 337 additional jobs that go to making the 900 jobs that Berkowitz referenced in his presentation to the Miami City Commission and in his letter to Mayor Regalado, but which in the application are not included in the total number of jobs needing to be filled in order to qualify for the $9 million in Project 124 money. The reason for this is because in the application they are listed as  OUTSOURCE/CONCESSION OPERATIONS jobs. They can be found on Page 4.


The 5 categories of jobs in the $21,000 to $25,000 pay range highlighted in RED account for 366, or 64.1% of the 571 jobs.


The 2 categories of jobs highlighted in GREEN, with average pay of $78,000 to $79,000, account for 9 jobs, and they account for 1.58% of the 571 jobs.


Of the 571 jobs, only 28 of them are salaried positions. Salaried positions are usually the jobs that one expects to be both full-time and  providing benefits. Many of the 366 jobs in the $21,000 to $25,000 categories on the other hand - like all the attendant positions, ticket counters, elevator operators, retail clerks, bartenders, waitresses and servers - are the kinds of service jobs that are normally associated with being part-time jobs, without benefits.


Because Skyrise Miami has to be considered for all intents and purposes a vertical amusement park, the employees have to be considered amusement park employees, and as such they would be categorized as  4th in the list of worst paid workers in America.


As for the additional 337 jobs not part of the number used to qualify for the Project 124 money, 72 of those are identified as valet attendants and another 73 are listed as food servers for a total of 43.3% of all the 337 jobs. Again the, 72 valet attendants at $20,000, and 65 servers at the low end of the $25,000 average, are not high on any list of what are considered high-wage jobs jobs providing benefits.


THIS ISSUE IS GETTING THE MOST IMPACT FOR YOUR ECONOMIC DEVELOPMENT DOLLAR


Because Miami-Dade County is identified as having the 3rd highest income inequality in the country, the idea of committing scarce economic development dollars to fund a project that holds no promise of creating even a simple majority of high-wage, long-term jobs with benefits from either the 571 or 900 jobs promised is a proposition that makes very little economic sense for the expenditure of money supposedly committed to “game changing” projects.

Berkowitz obviously figured that invoking a desire to help poor people, and especially poor Black people who live in Overtown was the next best thing to showing up waving a flag and carrying an Apple Pie when it came to trying to hustle support from one of South Florida’s most prominent Black elected officials.


The fact that he was able to provide a letter of support from his Pal, Miami-Dade Mayor Carlos Gimenez as an example of the kind of letter he wanted from Congresswoman Wilson, is also revelatory in that you can probably bet that the Mayor also wrote a supporting letter that Berkowitz has been providing to all of the Chinese EB-5 agents, and that he did all of this before agreeing to change the process for awarding Project 124 economic development funds to Berkowitz’s project.


This is not to deny that needs of folks in Overtown are real, and that those needs are obvious.


Unfortunately, the painful reality is that after all of the countless promises and pledges about doing “The Right Thing” by developers over the years, a visit to Overtown will quickly reveal that you will be hard pressed to recognize any of the kinds of economic benefits one would expect in an area so heavily targeted for employment and benefits as a result of all of these promises and commitments by developers.


From a political perspective, invoking the plight of poor people puts pressure on elected officials with access to tens of millions of public dollars available for “economic development,” as well as a need to keep an eye on the next election, to spend those dollars on projects supposedly claiming the capability of creating hundreds, if not thousands of jobs.


And so, at the November 5th County Commission meeting, when the proposal to give the Skyrise Tower $9 million in “economic development money” was introduced by Commissioner Bruno Barreiro, he asked County Mayor Carlos Gimenez to put on the record the number of jobs that would result from the construction of this project.  Here, in this short video sound bite is the Mayor’s answer.

Congresswoman Wilson

 

Re:  Request to Expedite Processing of Application

 

The purpose of this letter is to request that you correspond with USCIS and urge it to favorably consider our request to “Expedite the Processing” and review of our pending application for project approval of the SkyRise Miami Tower EB-5 Project (Request to Expedite Processing of Application filed March 4, 2014 is attached). We are not asking that you recommend the approval of the project application but to encourage USCIS to grant our Request for Expedited Review, based on established USCIS criteria for such expedited reviews. The main thrust of our request is that the Project brings immediate economic assistance to an area of the United States suffering from acute poverty and unemployment by creating immediate job opportunities for the residents of some of the poorest neighborhoods in the City of Miami, all of which are located within the same Enterprise Zone, Empowerment Zone and Targeted Urban Area as the Project itself.


The SkyRise Miami Tower EB-5 Project (www.skyrisemiami.com) represents a game changing development of an iconic 1,000 foot observation entertainment tower, located in downtown Miami. The Project is anticipated to commence construction in May 2014 with the total construction lasting 39 months. The $430 million Project will have an enormous and positive economic impact on the neighborhoods immediately surrounding the Project by creating 6,780 jobs during the development phase and 15,678 jobs, when operations commence according to the Washington Economic Group’s Report (a copy of the executive summary is attached ). The two neighborhoods which will be most impacted economically by the Project are the two in closest proximity – Overtown (52.5% below poverty level) and Liberty City (45.6% below poverty level). Their median household incomes are respectively 52% and 58% worse than the national average.


The area surrounding the Project are some of the most, if not the most, economically depressed areas in the United States and have been for decades. All are in desperate need of immediate employment opportunities. Expediting review of the Project will have an immediate significant positive economic impact on the surrounding areas residents. Timely processing of the project EB-5 application is crucial to maintaining the Project timeline and thereby creating such significant, immediate and permanent economic benefits to the residents of the City of Miami and its neighborhoods.


I would be most appreciative if you would correspond directly and as soon as possible with USCIS urging expedited review of the SkyRise EB-5 application. I am attaching a letter submitted by Carlos Gimenez, Mayor of Miami-Dade County as a sample of the type of letter we are requesting.  Should you have any questions or wish to discuss any details relating to our Project, please do not hesitate to contact me. Thank you in advance for your consideration of this request.

 

To ensure that your letter gets to the appropriate USCIS personnel in charge of our application, please use the following reference information in your letter.

 

Re:       Miami Metropolitan Regional Center, LLC, Regional Center

            Skyrise Miami Tower Investors, LLC, New Commercial Enterprise

            I-924 Application to Amend Designation/Exemplar I-526 Petition

            Receipt Number: RCW1405051687

 

 

Thank you.

 

Jeff Berkowitz

President

JEFFREY BERKOWITZ AND CARLOS GIMENEZ THROUGH THE YEARS


CAMPAIGN FUND RAISER FOR GIMENEZ HELD AT THE BERKOWITZ HOME

GIMENEZ AND BERKOWITZ AT ARSHT CENTER GALA

THE BERKOWITZ’S AND THE GIMENEZ’S AT PEREZ ART CENTER GALA

AT THE MAYOR’S BALL, CHAIRED BY JEFFREY AND YOLANDA BERKOWITZ

THE GIMENEZ’S AND YOLANDA BERKOWITZ AT JEFFERY’S NEIMAN MARCUS BIRTHDAY PARTY

To better understand what kinds of jobs make up these categories, the document below is Appendix F, that was submitted as part of the Berkowitz Application.

There are no “game changing” accomplishments to be claimed in giving public money to a project that creates hundreds of law-wage, part-time jobs.

Of course, the entire argument about jobs is a Red Herring issue that was put forward by the Gimenez administration so as to draw attention away from the fact that this $9 million is supposedly being requested to pay for Public Infrastructure projects associated with this project.


BERKOWITZ’S DEFINITION OF WHAT CONSTITUTES PUBLIC INFRASTRUCTURE NEEDS


In Section 5, Page 10, of the application, Berkowitz listed the type of public infrastructure needs that he feels should be covered by taxpayer dollars.  Here they are.

In advance of the November 5th County Commission meeting, and based on the description of the infrastructure projects included in the Resolution that would be introduced by Commissioner Bruno Barreiro, I prepared an itemized rebuttal to 4 of those items, including a portion of the video of the June 26th Miami City Commission where Berkowitz stated unequivocally that at his expense, he would pay for the Baywalk.


I also addressed the issues of the Parking garage, site utility relocation and Marine Construction by including pages from the various contracts between Bayside and Skyrise, the City and Bayside, and the City and Skyrise that detailed how the payment for these supposed public infrastructure costs had been included in the payments by Bayside and Skyrise agreed to as part of the contracts. (Ibid.)


This rebuttal and the supporting documents had been part of a larger story that included the information that Berkowitz had threatened to sue me because among other things, I had called him a duplicitous, hypocrite.

Unfortunately, like the County Commissioners, I had not seen the above list in advance of the November 5th meeting because the Gimenez administration had purposely excluded the Application from being part of the PDF accompanying the Resolution.

Now that this list is available, the attempt to claim that any of these construction costs should be considered as “public infrastructure” are even more egregious.


First, with the possible exemption of the “Biscayne Blvd off site work,” all of these “infrastructure” projects are on the Bayside property, which is leased from the City of Miami and controlled by Bayside for the next 99 years.


To better understand what Berkowitz is up to let’s look at the architectural renderings to understand what he means when he claims that this project “should have some level of government participation.”


Since I’ve already dealt with 4 of these items, let’s focus on a couple of the big ticket items like the the Plaza Concrete Upper Terrace Stairs  andTwo Level Garage under the Tower.


THE PLAZA CONCRETE UPPER TERRACE STAIRS


Here are the architectural renderings of the Concrete Upper Terrace Stairs. They are an integral part of the design and structure, equivalent to the stairs and front porch of a house.


How, or why these stairs would ever be considered “public infrastructure,” only works as a naked attempt to take advantage of a gullible public?

Underneath these stairs is the Two Level Parking Garage.


THE TWO LEVEL PARKING GARAGE UNDERNEATH THE TOWER


Again, these parking garages are integral part of the design and structure of this tower, equivalent to first two floors of a house, or any other kind of commercial building.


To classify these two floors as “public infrastructure,” when they are intended to provide private parking for “Marina Office/Executive Staff” and for revenue generating “Valet Parking,” again shows a willingness to abuse the taxpayers.

VALET ONLY PARKING

VALET ONLY PARKING

VALET ONLY PARKING

VALET ONLY PARKING
MARINA OFFICE/EXECUTIVE STAFF SELF PARKING

These two items alone account for $15.5 million dollars of supposedly “public infrastructure” funding that Berkowitz want someone else to pay for.


Then of course there is $3 million for Marina Construction.


MAKING THE CITIZENS OF MIAMI PAY AGAIN FOR SOMETHING THEY ALREADY OWN AND HAVE PAID FOR ONCE


The big eruption between Miami Mayor Tomas Regalado and Jeffrey Berkowitz occurred when the Mayor supposedly found out that, contrary to his promise of not seeking public money for this Tower, Berkowitz was trying to do just that by having his pal, Miami-Dade Mayor Carlos Gimenez submit a request for $9 million of “public infrastructure” funding from the Project 124 slush fund.


That’s where I came in and called Berkowitz a duplicitous, hypocrite.


Well, not only am I legally entitled - as any citizen is entitled to call a public figure with his hand stuck out trying to get public money - a duplicitous hypocrite, but part of the deal, where he is trying to get County money to cover the $3 million costs associated with “Marina Construction,” are clearly an example of the taxpayers of Miami being expected to pay again for something they already paid for, and which is now only a problem because of the construction of this Tower.

  “SKYRISE MIAMI IS NOT LOOKING FOR ONE NICKEL, NOT ONE PENNY OF CITY OF MIAMI SUPPORT.”

In the collection of almost 20,000 emails that I obtained over a period of 3 months in my initial investigation of this deal, there are numerous emails that related to the disruption and loss of revenue to the City that would occur as a result of the Tower’s construction.  Several of those email were included in my May 16th story about Skyrise.


One of those documents is of critical importance because like Berkowitz’s claim before the City Commission that he personally would cover the costs of the Baywalk construction, there is a document in the City’s files saying that Berkowitz would cover the costs of both the Electrical upgrades, and the Marina Construction.

Having made this promise, the notion that the taxpayers of Miami, under any circumstances would be asked or expected to pay one nickel, or even one penny towards rectifying the problems created by the disruption of the Miami Marina at Bayside because of the construction of this Tower is  prima facie evidence that they were lied to when they were told that this project would not cost them “one cent!”


WHAT’S THIS DEAL IS REALLY ALL ABOUT, ALFIE


At the end of the day this effort to get $9 million is not about “public infrastructure,” but rather I believe it’s about the fact that Berkowitz entire financing package is predicated on trying to get Chinese investors to give him over ONE QUARTER OF A BILLION DOLLARS IN EB-5 MONEY TO FINANCE THE CONSTRUCTION OF THIS TOWER.


That’s what I think this is really all about. Berkowitz doesn’t need $9 million in taxpayer money to do this job, and that’s evident by the fact that he’s previously stated that he was going to cover many of the costs that he now claims are “public infrastructure” costs that the public should pay for.


No, this $9 million represents “Flash Money.”


Chinese EB-5 investors are very big on looking for projects that are supported by local governments as a way to gage the strength of the project, and protection for their investment.


If you look at Berkowitz’s financing plan, it’s essentially constructed as  house of cards that depends on one level of financing providing the foundation for the next level of financing.  The first, and most critical level of financing is the QUARTER OF A BILLION HE HAS REPEATEDLY STATED THAT HE INTENDS TO RAISE FROM CHINESE INVESTORS THROUGH THE EB-5 IMMIGRANT PROGRAM.


A QUARTER OF A BILLION DOLLARS is actually an amazing amount of money to try to raise from EB-5 investors for almost any project, but especially so for a vertical amusement tower that I and others have pointed out that includes several significant problems that we feel are inherent in Berkowitz’s financial projections.


This deal ONLY makes sense as a naked reach around by Miami-Dade County Mayor Carlos Gimenez to give his pal and campaign contributor Jeffery Berkowitz a $9 million gift of taxpayer dollars, both a token of their friendship, and as the “Flash Money” that he can show to the Chinese investors as proof that his local government believes in him and his project, and therefore they can feel safe in giving him their money.


In short, I contend that the real reason for Carlos Gimenez’s efforts to get the County Commission to give Berkowitz this $9 million in taxpayer money is so that he can use it as the “Flash Money” to help him raise the money from EB-5 investors, which rumors claim he has not done.

If this isn’t true, then Jeffrey Berkowitz can very easily make me out a liar and refute the rumors by releasing his EB-5 bank account statements on Monday morning revealing how much money he has already raised from investors! We’re talking about money in the bank, not pledges, promises or commitments.

It’s always Miami, Bitches!