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Miami Herald - May 28, 2017

Roaches, rats and taxpayer dollars: Plan to save crumbling Overtown condos in trouble

By David Ovalle, David Smiley and Nicholas Nehamas

The tax-funded renovation of Town Park Plaza North, a crumbling Overtown community of more than 100 families, was touted as a new beginning for one of Miami's most impoverished and neglected neighborhoods.

But two years after breaking ground, the ambitious $15 million project has been mired in delays, conflicts and cost-overruns. Renovations have finished at just three of Town Park's 20 condo buildings, less than half of what planners expected to complete by now.

Families told they'd have gleaming new homes have been exiled to temporary housing for more than a year. Those who live in units still awaiting renovation have to battle rotting pipes, swarms of roaches and broken air conditioners.

Few want to invest in pricey repairs because their units will be gutted - some day.

"They made it sound so beautiful," said resident Chris Little, whose first-floor unit floods with sewage from pipe breaks. "It's not right what they're doing."

Executives of the Miami redevelopment agency funding the project say they're pushing the general contractor to complete five more buildings by mid-June and get back on track. But problems run deep.

A Miami Herald review of the project found poor planning, questionable spending and the selection of an inexperienced contractor have slowed Town Park's revitalization, leaving residents angry and confused.

Among the most troubling aspects:
City officials insist the end result - beautiful condos fit for the cover of a glossy real estate brochure - will be worth it.

"We will cement our legacy with what we do here," said Clarence Woods III, the $149,000-a-year executive director of the Southeast Overtown Park West Community Redevelopment Agency.

Woods says permitting problems and the unexpected discovery of asbestos significantly slowed down work and inflated costs. Yet he believes Mastermind will meet a mid-2018 deadline to finish the project under a contract that - despite public representations that work would take two years - allowed 40 months from start to finish.

But he's antsy. The redevelopment agency has given Mastermind until the end of May to finish three more buildings and move roughly two dozen families back home. It now acknowledges Mastermind "under-budgeted" part of the work and will likely need more money from the public to complete the job, although Woods said $4 million is too much to ask.

Mastermind, meanwhile, was so hard-up for cash in February that it needed a funding advance from the CRA in order to speed up work and pay laborers.

"As we have previously discussed, every day that tenants are out of their units represents a cost that is above our budget for the relocation portion of the project," a CRA architect wrote in a Feb. 22 memo.

Woods admits the redevelopment agency rushed Mastermind into the job in order to get work moving. But he blamed the contractor for failing to alert CRA officials that the initial budget wouldn't stretch far enough. At one point, the construction site resembled a "ghost town" because Mastermind couldn't afford a big-enough crew, Woods said.

Not long ago, Woods said, he threatened to pull a roughly $3 million construction bond posted to guarantee its performance unless Mastermind showed more progress.

That'd be fine by longtime resident William Huggins, 77, a food deliveryman. "I've been here 39 years and it's been nothing but a rip-off!" he said of the slow-moving rehab project that has barely touched his second-floor unit.

Gaps in brand-new window frames - replaced months ago during an initial stage of renovation but not yet properly sealed by workers - invite swarms of bugs into the moldy interior of his apartment. The problem is so overwhelming that Huggins sleeps with five cans of bug spray next to his bed. Insects crawl over him at night.

"Sometimes, you pull back the covers and there's roaches there," Huggins said. "This here is what you call survival."

The promise

It's not common for taxpayers to spend millions in public money renovating private homes. But Town Park Plaza North is an important constituency in a neighborhood owed a debt by government, which drove an interstate through Overtown's core in the 1960s and then ignored the collateral damage.

The 169-unit complex was one of three Town Park neighborhoods built in the early 1970s with federal funding and fashioned as "cooperatives," or co-ops, which allowed residents to pay membership fees to own a share of the building and live in the units.

Over time, the complex deteriorated as board members resisted raising fees to pay for maintenance. Eventually, a judge appointed a receiver to save the community - which converted to condos in 2003 - from total financial collapse.

Miami Commissioner Keon Hardemon

In stepped the Southeast Overtown Park West Community Redevelopment Agency.

Operating under a state law that allows government to capture and reinvest property tax dollars back into neglected and blighted neighborhoods, the agency has set aside more than $80 million over the past three years toward spurring development, commercial projects and housing. In 2009, the CRA expanded its borders to include all three Town Park communities, setting the stage a few years down the road for Miami commissioners to allocate millions toward renovations.

Town Park Plaza North would get $15 million in September 2014. By the following January, crews took the first steps toward replacing roofs and windows, overhauling water and sewer lines and moving residents out to begin interior demolition and construction.

"I told Clarence that ‘One day, these people are going to come and thank you,'" Commissioner and CRA Chairman Keon Hardemon said in 2014 when he and Miami's other commissioners selected St. John and Mastermind to run the project.

"I will tell you - and I probably never said this out loud - but his job depends on this Town Park stuff … because I know what has happened to this community."

For Town Park residents living in the three finished buildings, life is cozy, even if the work took longer than expected.

Ellis Prince, 88, spent nearly one year displaced before moving back in. He's delighted with the upgrades. "It's nice," said Prince, who first moved here in 1978.

But many have experienced only frustration.

Enzo Junior, who bought a Town Park North unit in 2015 as construction was beginning, says shoddy window work during the first phase of the project kept him from moving into his unit and forced him to rent an apartment while he waits. Worse, in August he filed a police report after he says he realized during checkup visits that cons

truction workers were partying in his home.

"There were used condoms and drug paraphernalia. And the only people who could get into my apartment were the construction workers because they'd put new locks on," said Junior, who is now housing another relocated tenant in his unit, which has yet to undergo extensive renovations.

Up to the job?

The Town Park contract was sought by some of Miami's premier contractors and developers, including Related Urban Development Group, which is currently rebuilding Liberty Square, a massive redevelopment that involves moving hundreds of families. But Miami commissioners took the advice of a CRA selection committee and chose Mastermind Construction, a company that had never attempted a project approaching the complexity of Town Park.

Henry Marines, Town Park's court-appointed receiver, believes Town Park was too difficult a project for a small contractor.

"The learning curve was too big," he said, although he added that Mastermind - under pressure from all sides - has lately picked up the pace.

The firm has no management trailer on site, and doesn't even have its own office - Mastermind's president, Timothy Smathers, runs the company from his home in Miami Gardens.

Reached by phone, Smathers said his team is back on schedule. He blamed delays on St. John not having enough units to relocate families.

"It's not the size of the project, it's the relocation where things happened," Smathers said. "We couldn't start construction because there weren't units to move people."

He also believes it would have been easier to simply tear down the aging complex and build new units.

"I could build a townhouse in 90 days," he said.

Before Town Park, Mastermind had done a handful of smaller taxpayer-funded rehab projects in Miami-Dade County, several in conjunction with the St. John CDC. Over the past five years, the Overtown redevelopment agency has allocated nearly $2 million to several minor rehabs involving Smathers and a partner, Carlos Rolle.

Mastermind's jobs in the private sector have included work at the Foxxy Lady strip club in Liberty City, according to public records. But some of the company's other clients reveal a surprising overlap with the taxpayer-funded project at Town Park.

Last year, the company performed $39,000 in interior work and roofing on an aging three-bedroom Miami Gardens house. The owner? A company controlled by Woods, the CRA director.

Woods insists that no "blurring of the lines" took place between his private and public lives. He showed a reporter canceled checks and receipts to prove he didn't receive a discount, saying he hired the company only for "convenience."

"I'm not hiding that. I make no apologies," Woods said, although he added the home renovation ran behind schedule, too.

"In hindsight, would I do it again?" he said. "Probably not."

That's not the only example.

Smathers' business partner, Carlos Rolle, whose company did engineering work on the Town Park renovation, has also performed work for Aluko, the head of the St. John CDC.

Public records show that in 2014 Aluko hired Rolle's company as a contractor for a new two-story home in Kendall. The land alone is valued at almost $400,000, according to property records.

Rolle did not respond to messages. Aluko, a former city of Miami executive in charge of construction projects, said he hired the company only to pull permits, and is paying full price.

"There was no quid pro quo," Aluko said. "Everything is above board."

Odua Group

Aluko has seamlessly slid into the world of nonprofit development after his career as a public servant ended in controversy.

In 2010, he was forced to resign from a $196,000-a-year gig overseeing Miami's capital improvements program after telling superiors that his employees were inflating prices. Miami's then-city manager said the problems were already known, but Aluko claimed he was a whistle-blower, and eventually the city approved a $20,000 settlement.

Following his ouster, Aluko became president of St. John Community Development Corporation. Since 2011, the nonprofit, affiliated with an Overtown Baptist church, has been busy thanks to taxpayers - between 2011 and 2015, it garnered nearly $12 million in direct government grants, according to public tax documents.

During that time, St. John has also hired Aluko's private firm, Odua Group, for "construction management" on a slew of projects. Between 2011 and 2015, Odua, which also works for other clients, earned more than $900,000 from the nonprofit, tax records show.

On Town Park, invoices show the CRA paid Odua $5,500 per unit for "relocation services" - even though the original contract never mentions Aluko's company. His firm had been paid $217,900 directly by the CRA as of the end of April, but that changed after Marines, the receiver for Town Park, complained that Odua was not named in the relocation contract. Now the CRA pays St. John, which in turn pays Odua, an arrangement that still leaves Marines scratching his head.

"I don't know what Odua is," he said. "All it does is make money."

Aluko said Odua Group has helped oversee relocation efforts through a consulting contract with St. John, and splits a percentage of the relocation fee with the CDC. He declined to say how much taxpayer money Odua has earned in total.

"All that is private information," he said. "That shouldn't be disclosed to the public."

Is the costly process of relocation even necessary?

Todd Jay Jonas, an architect who guided the process of converting Town Park to condos, says no. He drafted plans calling for homeowners to move into vacant units at Town Park and then into whole new structures built from the ground up on the complex's plentiful land. But his development team wasn't chosen for the project.

"All that relocation was pointless," Jonas said.

Aluko defended the relocation plan during an interview at St. John's Overtown office. The plan he submitted in March of 2015 recommended moving just two buildings and 15 households at a time for three to four months to keep costs down and construction manageable.

He also distances himself from construction woes, even though in a proposal for the renovation his firm touted itself as a savvy construction project manager. But like Woods, he believes the project will finish on the three-year schedule laid out by its contract, or at least close to it.

"It irks me to know that what's out there on the street is it was meant to be a two-year project" he said.

But the two-year time-line many residents cite in their complaints about slow progress didn't come out of thin air. The CRA's own annual report for 2014 said the renovations would take between 18 and 24 months. And Mastermind's community-outreach team called the job a 24-month project in documents filed with the agency.

Among its duties on the project, Odua was paid to complete surveys of each unit to find out what occupants needed in order to relocate. The company earned $550, or 10 percent of the relocation fee, for each query.

The forms are supposed to be signed by interviewees.

But in a stack of invoices to the CRA, Odua submitted an interview form with Jaime Perkul, a businessman who owns a unit but lives in Argentina. Shown the document featuring Odua's logo and his purported signature, Perkul bristled.

"Nobody has ever called me," Perkul said from Argentina. "I didn't sign that. I don't even know who that company is."

Aluko is adamant that the call took place, but admits Perkul did not sign the document. He says Odua wasn't paid for interviews with the landlords, but rather their tenants.

"His name in the signature line was in error," Aluko added. "It wasn't meant for billing purposes. Those somehow made it into our billing."

In the meantime, Town Park residents want work to speed up - or in some cases simply begin.

Adrian Madriz, a housing activist who is currently renting his Town Park unit to a relocated neighbor in a building that has yet to undergo renovation, says trying to keep his property in liveable condition has been near impossible.

Madriz says problems like a "severe rat infestation," a rundown air conditioner and a broken toilet persist because of the web of agencies now involved. He said simply fixing his toilet has been difficult because he needs to shut off the water to the entire building but can't get anybody on the phone to make it happen.

Madriz, who works for a nonprofit called Smash the Slumlords, says he almost feels like one himself because his tenant - relocated from a building under renovation - is living in such poor conditions.

"This is a quagmire," he said. "Every time you try to get them to do anything they're all pointing fingers at each other. Everybody is blameless for everything."

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