April 1, 2013
By David Arthur Walters
MIAMI BEACH—City of Miami Beach officials have discounted or written off what is believed to be millions of dollars in fees and fines over the last few years. The exact amount has not been ascertained because the city does not regularly account for the uncollected funds as required by the generally accepted accounting principle that activities which have a material impact on an entity’s finances should be regularly accounted for and reported.
Law enforcement officials were interested in what David Weston, a former fire inspector, had to say about building permit fee discounts and uncharged permit fees. Weston believes he was fired on the pretext of trumped up ethics charges for reporting and insisting on the collection of what he called “missing monies”allegedly amounting to millions of dollars. However, no charges were brought against any officials because it was determined that they have the discretion to reduce or not collect building permit fees under the general authority of the city manager, and that such largesse is not technically a crime even when corruption is suspected.
A controversy erupted in the summer of 2012 between the city attorney and special masters, quasi-judicial magistrates responsible for hearing certain code and ordinance violation cases to assess fines that they may “mitigate” or reduce if violators meet certain criteria forwriteoff or reduction. For example, if violators have done their best to promptly make the corrections needed to conform to the law, then there is considerable wiggle-room for mitigation because the emphasis may be on getting violators to comply rather than punishing them harshly for infractions. The seriousness of the violation may also be considered, and whether or not the fine would be excessive in relationship to the value of equity in the property.
One reason that the state legislature provided authority for municipalities to set up code enforcement boards or, in the alternative, a “special magistrate” system, was to provide local discretion over code and ordinance fines at less expense than could be had in the regular courts. The boards, whose magistrates do not have to be attorneys licensed by the State of Florida, were conceived of as “citizens’ boards” independent of the will of municipal administrators.
City Attorney Jose Smith was careful to deny that he wanted to control the special master facility, which, he said, is not a real court but is rather a creature of the city commission that can be abolished by the commission. Nevertheless, he wanted the commission to replace chief special master Abraham Laeser with special master Enrique Zamora, who was expected, in turn, to retain Laeser as a lesser special master but to fire and replace subordinate special masters Babak Movahedi and Joe Kaplan.
It was alleged that Kaplan was becoming forgetful with age, and that Kaplan was not moving cases along quickly enough. Movahedi, on the other hand, had become a thorn in the side of the city attorney over what appeared to be a choleric personality clash with his assistant, Aleksandr Boksner, a clash that Mayor Matti Bower likened to sibling rivalry. The substance of the issue, however, appeared to be control over the assessment of fines and their mitigation.
Boksner, a graduate of the Toledo College of Law and licensed to practice in Florida, objected that Movahedi did not have a Florida license, and implied that he was incompetent. Movahedi obtained his JD and LLM degrees from Georgetown University, and practiced international law in the District of Columbia before moving to Miami Beach.
Movahedi soon obtained a reputation of being a Judge Judy special master, a no-nonsense magistrate who would not tolerate such excuses as, “I did not comply with your order because someone down the hall said the law does not apply to me.” Or, “I was residing at my home on the Riviera at the time and was unaware of the violations at my South Beach residence.”
That is not to say, however, that Movahedi is a so-called hanging judge. Boksner took him to task for applying a principle of equity called equitable estoppel. To wit:a government can be stopped from penalizing someone who relies on its word or conduct that there would be no penalty in that situation. To do otherwise would be inequitable or unfair. An information sheet handed out to persons cited for violations, entitled ‘Notice to Violators—Late Compliance,’ states that the special master may make judgments in law or equity, meaning that s/he can override the strict provisions of law if executing it would be unfair or unjust.
For example, Movahedi had a case before him involving the purchase of property with the understanding that the city had allowed or would allow parking on the property, but the city did an about face after the property was purchased, and went after the new owner. Movahedi asked a city attorney for pertinent case law on the subject, was presented with same, and then stopped the city from making good on its claim. That ruling rankled Mr. Smith, who stated in a June 12 email that “This ruling is erroneous and must be appealed forthwith. The notion of ‘equitable estoppel’ is JUDICIAL remedy, and not the purview of a Special Master. There is either a violation or not. The Special Master exceeded his authority. Abe, I’ve had enough of this nonsense!” But the ruling was not appealed.
Movahedi insists that he is duty bound to apply the law to the facts. But Boksner said he should apply the facts to the law, an assertion that may imply that Movahedi casuistically stretches the law to fit the facts rather than making sure the facts fit the law as it is strictly constructed. Smith refused to allow Boksner to explain his statement on the grounds that an explanation would be tantamount to providing legal advice to the journalist making the inquiry.
Most saliently, Movahedi, in his application of the law, has refused to recognize any settlements or mitigations of fines by the city attorney, or others under the authority of the city manager, prior to the rendering of his judgments. For example, a violator may state that he has agreed to pay, say, $2,500 instead of $25,000, and an assistant city attorney present at the hearing might not objection to the settlement. When asked with exactly whom the agreement was made, some lesser official might be referred to, someone having authority from the city manager to make deals.
Movahedi leans forward agitatedly and his voice hits soprano notes when he is confronted with deals that challenge his authority to apply the law to the facts. His demeanor terrified a lawyer or two, wherefore a formal investigation was conducted, and his alleged courtly misdemeanor was written off as a misunderstood ethnic or cultural artifact. In any case, he insists that it is up to the special master to assess the fine and mitigate it if mitigation is warranted by the situation. Then and only then may the city make some other arrangement with the violator pursuant to the resolution personally drafted by City Attorney Smith for the commission, to the effect that the city manager may reduce or write off fines less than $100,000, and the commission may do so if the fine is over that amount. In practice, a financial analyst for the city manager approves of the lesser writeoffs, apparently at the bidding of the city attorney, whose advice on the larger amounts is considered by the commission.
Naturally members of the community who disagree with the fines imposed are inclined to blame the special masters either for going too hard on or too easy on violators. For example, annoyed residents were up in arms over a deal allegedly struck with a large event organizer to reduce a noise code violation fine. Suffice it to say that public pressure could be employed to manipulate the commission to place virtually absolute control over the ideally independent special master process in the hands of the city manager and/or city attorney.
It is difficult if not impossible to hold officials accountable for writeoffs and reductions that could run into untold millions of dollars over time and become a honey pot for corruption. When City Clerk Rafael Granado was unable to provide an accounting of the writeoffs and reductions, a proposal was submitted to Interim City Manager Kathie Brooks, City Attorney Jose Smith, and Commissioners Ed Tobin and Deede Weithorn, to regularly account for and report mitigations, writeoffs, reductions and the like by means of a paper or electronic “warrant” signed by the person actually authorizing them. In special master cases, that would be the particular special master, or the city manager, or the city clerk on behalf of the commission. And why not use that principle with all reductions including reduction in permit fees, wavers of double permit fee penalties, and the like? The gross amount would be entered on the warrant form along with the reduction, the reason for the reduction would be given, and the form would be signed by the authorized person, and then initialed by his or her superior. The net amounts collected would of course reconcile to cash under the city’s modified cash basis accounting methodology.
Commissioners Tobin and Weithorn did not respond to the proposal. Smith said the proposal was “moronic,” that there was no question of “blame,” and that he simply believed in “following the law.” No blame, no responsibility. Brooks declined to have the reductions accounted for, preferring to refer the matter to Crowe Horwath, LLC, an outside consultant auditing city systems and processes. Crowe Horwath was offered information on the subject, but spokesperson Jan Lippmann declined to receive unsolicited information or to answer questions as a matter of policy: its information is limited to that supplied by city officials.
Brooks did not comment on the frequent deference of the administration to the opinions and proposals of outside consultants at considerable cost to the city, the notion that the city is literally outsourcing crucial aspects of governance such as data collection, analysis, recommendation, planning, et cetera, instead of resorting to self-reliance on internal resources that should be competent to address the issues, and on serious consideration of input from residents and businesses who are often outraged by the alleged negligence and laziness of some officials. Commission Weithorn, when discussing another matter, did voice her dismay over the fact that business as usual continues despite outside consultations and recommendations.
Brooks, who was a top administrator under the former city manager, Jorge Gonzalez, has been an outspoken advocate of transparency since Gonzalez was involuntarily retired in the wake of several F.B.I. arrests of city employees, but ‘transparency’ is often no more than a word. City Clerk Granado, responding to the rumor that the opaque special master information system was a relic from the Stone Age, and that “records are being kept on bear skins,” said that the system was being upgraded. He did not respond by deadline to the suggestion that special master hearings be videotaped live and broadcasted like commission hearings. No doubt the public would be as edified and entertained as they are by Judge Judy.
# #
Share
Save
