At its February 13, 2019 meeting, the Mayor and Commission addressed the financial condition of Miami Beach Community Development Corporation (MBCDC) and a variety of compliance concerns noted by Miami-Dade County (County) and the city. The Mayor and Commission initially made a referral to the Neighborhoods Community Affairs Committee (NCAC) for further discussion including addressing the conditions of the agency’s properties and its progress in addressing County compliance concerns. The item was subsequently referred to the Finance and Citywide Projects Committee (FCWPC) for further discussion as the agency’s finances became the central concern.

The City and County have invested millions of dollars in acquiring and rehabilitating MBCDC’s affordable housing stock. The city’s investment stands at $9,690,645 in federal, state and redevelopment agency funds. The federal and state funds require the city to ensure that assisted properties remain compliant with rules and regulations (including property maintenance standards) and continue to serve income-eligible households.

At its May 2019 meeting, FCWPC requested that an update on MBCDC and its fiscal position become a recurring reporting item to the Committee every 90 days.

BACKGROUND

As conveyed via LTC 159-2018, MBCDC had been operating at a recurring annual deficit exceeding $ 100,000.  For the past year, Miami-Dade County and the city have been meeting with MBCDC staff and board members to address the agency's financial situation. On April 27, 2018, the County sent MBCDC correspondence notifying the agency of the County's intent to foreclose on the Crespi Park Apartments as a result of MBCDC's default of its funding agreement. To settle a variety of compliance issues, MBCDC agreed to assign ownership of the Madison Apartments, a 17- unit affordable housing property located at 259 Washington Avenue, to the County.

Since the May FCWPC meeting, the City has been tracking its receipt of tenant complaints for MBCDC-owned properties. City staff has intervened and or monitored progress on tenant complaints from a variety of MBCDC properties including:

• Villa Maria Apartments
• Villa Matti apartments
• Crespi Park Apartments
• Allen Apartments
• Jefferson Apartments
• Meridian Apartments

 Tenant complaints have included:

• Ineligible residents
• Property maintenance issues
• Late lease renewal
• Inoperable intercoms
• Termites and pest issues
• Water intrusion
• Not responding to tenant calls
• A/C issues
• Substantive delays in cashing rent checks

MBCDC has remedied the default notices sent by the City for failing to recertify tenants as required by HUD. The following are MBCDC items being tracked for compliance as of this writing:

Villa Matti Apartments – The chairlift has been inoperable since July 2018. The lift was replaced and is currently pending inspection by the City.

Jefferson Apartments – The building received an unsafe structure violation on August 15, 2019. The building’s first floor shows evidence of structure deterioration and will require the replacement or repair of the first-floor foundation and flooring. As of this writing, MBCDC is currently working with an architect to design plans to enable the repair.

Shelbourne Apartments – The building requires extensive renovation that will result in temporary relocation of tenants. An architect has been retained and the tenant relocation process is expected to commence in March 2020.

Supporting affordable, compatible workforce housing is a key management objective in the 2019 Strategic Plan: Through the Lens of Resilience. MBCDC is a significant provider of affordable housing in the City. The City continues to work with MBCDC to address compliance issues to ensure that their affordable properties remain in the City’s affordable housing portfolio.