Tug of War
An out-of-state company manages to crack south Florida's monopoly tugboat business.
By Pat Dunnigan
It takes a combination of power and finesse to guide a 900-foot container ship safely into berth. But even experienced tugboat operators are unprepared for the maneuvering it takes to navigate south Florida's political waterways.
Ohio-based Great Lakes Towing has been steering a difficult course for 17 months since it began trying to break in on a 43-year-old monopoly on tug business at Fort Lauderdale's Port Everglades.
The company knew that the influential Hvide Marine (pronounced vee-duh) had locked up the port's $7-million towing business for more than four decades. But in recent years, Hvide's reputation had taken something of a beating. Last year the company pleaded guilty to paying $60,000 to a local union leader. The company filed for Chapter 11 bankruptcy protection and had seen a spate of infighting among family members over millions of dollars in family trusts.
Great Lakes executives figured the time was ripe to take a crack at getting in on some of the business at the port. Vice President and General Counsel Frederick Goldsmith says despite Hvide's problems, others in the industry figured his chances were nil. "Some people said we were really swimming upstream, that they are so well-connected there's no way you can get in."
For a while, they were right. Hvide, reorganized under new ownership as Seabulk International, mounted an intensive lobbying campaign, arguing that the Great Lakes company had a spotty safety record. Such arguments persuaded a divided county commission, which voted 5-4 in March to preserve the exclusive arrangement, despite the fact that it had drawn the scrutiny of the Federal Maritime Commission.
But a few months later, commissioners learned that the Broward Sheriff's Office officials who manage security at the port were worried that Hvide's guilty plea might disqualify it from doing business at the port. Commissioner Ben Graber says he and some other commissioners hadn't known of the guilty plea until then. "We felt there was information being kept from us," he says.
By August, Graber was ready to change his stance, and the commission voted to grant Great Lakes a competing franchise. It's a good thing, says commission Chairman John Rodstrom, who also voted to end the monopoly. "I think if we had said no, we'd have ended up in a lawsuit, and we would have lost. The port has had a history of doing things one way," he says. "I think that's going to change."
Seabulk spokesman Jack O'Connell says he doesn't know how the two companies will manage to share the business next year. He says tugboat calls are down by about 7% this year and Seabulk's five tugs, which make from $1,000 to $1,500 for each call, are idle about 80% of the time now. Nevertheless, the company's contract requires it to keep five tugs and crews on call 24 hours a day.
In the News
Boca Raton -- Short-line and regional railroad operator RailAmerica (Nasdaq-RAIL) says its annual railroad freight rose 6%. The company operates 39 short-line and regional railroads in the U.S., Canada, Australia and Chile ["On the Fast Track," March 2001, www.FloridaTrend.com].
U.S. Plastic Lumber (Nasdaq-USPL) had been facing possible delisting for failure to meet a Nasdaq requirement that its shares maintain a price of at least $1 for 30 consecutive days. But in the aftermath of the terrorist attacks, Nasdaq suspended its minimum bid and public float requirements until Jan. 2.
Luxury resort operator Boca Resorts Inc. (NYSE-RST) is expecting reduced revenues this year as the result of September's attacks. Disrupted airline schedules and interrupted travel plans led to a number of last-minute cancellations of group bookings at the company's Florida properties.
Fort Lauderdale -- First American Mortgage Securities Inc., the investment mortgage banking division of Tidalwave Holdings (OTC-TDWV), has acquired Nationwide Foundation of Lenders for $2.1 million. The deal calls for First American to open 105 storefront mortgage origination offices nationwide. First American buys loans for resale either as mortgage-backed securities or in institutional private placements.
Board members of internet sports media company SportsLine.com (Nasdaq-SPLN) have authorized the buyback of up to 6 million shares of the company's stock.
Promoteit.com, a Fort Lauderdale-based promotional products company, has beefed up its inventory of American flag-decorated products, including pins and bumper stickers, and is donating profits to New York City recovery efforts.
DirecTV Latin America has become the first satellite television company authorized to operate in Uruguay, bringing the company's Latin American and Caribbean markets to 28.
Fort Lauderdale-based Renaissance Cruises has ceased operations. The cruise line, which offered upscale cruises, operated six vessels.
Hollywood -- The Seminole Tribe of Florida has sued its brokerage and two ousted tribal officers, alleging wide-ranging misuse of tribal money. According to the lawsuit, Coral Gables broker Peter Ripich of St. Petersburg-based Raymond James and Associates depleted a $30-million brokerage account by two-thirds with a variety of risky schemes, account churning and inappropriate investments. Such misuse enabled former operations manager Tim Cox and former tribal leader James Billie to divert tribal money to their own use, according to the complaint.
City officials are gearing up efforts to lure the Fort Lauderdale landmark International Swimming Hall of Fame. Hall of Fame officials are seeking a new home after their efforts to expand in Fort Lauderdale snagged on the city's refusal to redevelop a municipal parking lot. Competing cities include Miami, Pompano Beach and Las Vegas.
Palm Beach -- Fort Lauderdale-based AutoNation (NYSE-AN) has purchased Lexus of Palm Beach, its only south Florida Lexus dealership, for an undisclosed price. The dealership had $118 million in revenues last year.
Palm Beach Gardens -- Software maker eCom eCom.com Inc. (OTC-ECEC) will demonstrate its Z Box technology for Kennedy Space Center. The Z Box system is being considered for use as part of a launch pad perimeter surveillance system.
Plantation -- The elegant Fashion Mall, struggling with a lagging customer base that has forced some of its smaller retailers to close their doors, is looking for a buyer. Lender Wells Fargo foreclosed on the 637,000-sq.-ft. mall and adjoining 115,000-sq.-ft. office building in April. Wells Fargo Vice President Dale Irwin says the company hopes to find a buyer by the end of the year.
Vero Beach -- New Piper Aircraft laid off 250 workers and announced plans to shut down its plant for two weeks, saving $2 million. The company cited flight restrictions and cash-flow problems. It employs 1,250.
FAU: Campus Boost
BOCA RATON -- Florida Atlantic University hopes to add two new campuses in Pembroke Pines and Vero Beach. The university, Florida's fastest-growing, has seven campuses and about 25,000 students. Enrollment has more than doubled over the past decade, spokeswoman Lynn Laurenti says. FAU also announced that it has struck a licensing agreement with a biotechnology company formed by two of its researchers. The company, Forseti Biosciences, will focus its research on genetic methods of cancer detection and treatment. Its first product is a diagnostic kit for colon cancer.
A new report offers a glimpse of south Florida in 2010.
By David Villano
Ryder System, one of Miami-Dade's last major corporate residents, moves its headquarters to Memphis; a U.S. congressman's wife is killed while on a humanitarian mission to Cuba, triggering unrest among Cuban-American exiles; police in Fort Lauderdale kill more than a dozen neo-Nazi skinheads in a gunbattle.
Those events are purely fictional. But they are among a multitude of possibilities imagined by a comprehensive report that attempts to sketch how south Florida could evolve over the next decade. How the community responds to such challenges, the report says, will determine whether it emerges as one of the hemisphere's most livable and dynamic regions or stagnates into a blighted urban backwater of ethnic
"The idea behind this was to show south Floridians that our decisions today will impact us well into the future. Historically, I don't think we've done a very good job of recognizing that," says Rod Petrey, an attorney in the Miami office of Holland & Knight and president of the Collins Center for Public Policy, a non-profit advocacy group that commissioned the report.
Petrey lays much of the blame on a decentralized government structure, particularly in Miami-Dade, that turns citizen focus inward toward a community level, rather than outward to the larger tri-county region. Ineffective civic and political leadership, he says, compounds the problem.
The report, South Florida 2010: Four Scenarios for the Region's Future, predicts four possible outcomes. At one extreme, dubbed "Epicenter of the West," the region embraces its multiculturalism and vanquishes public corruption to emerge as one of the world's great cities -- a leader in the internet economy, investing resources in education and environmental preservation. In the other extreme, "Falling off the Edge," economic opportunity gradually and irreversibly slips away as the region succumbs to ethnic power struggles and inept public-sector decision-making. In this scenario the quality of public education continues to decline, prompting businesses to flee northward.
Somewhere in between lies "The Happy Siesta" scenario in which economic growth stagnates amid a Hispanic takeover of the region's economic and cultural institutions, fueling an exodus of whites and blacks; and "Rio in South Florida," in which south Florida adopts the troubled legacy of many Latin American nations: A widening gap between rich and poor with economic and political power tightly controlled by a powerful elite. The report was prepared by a California think tank that specializes in regional scenario planning.
Whether the predictions will spur the community to action is uncertain. Regionwide initiatives such as the Internet Coast project, the Tri-Rail transit system and even the Everglades restoration effort are encouraging signs, Petrey says. But in many other ways south Florida's business and civic leaders remain myopic and parochial. "People need to start taking a broader view of things," says Petrey. "Everything we do now matters later. It's not too late to shape south Florida in a positive, lasting way."
In the News
Miami -- The University of Miami and Florida International University have teamed up to create a think tank charged with examining economic, political and social issues related to the European Union. The European Union Center, one of 12 being opened around the U.S., was made possible because of a $425,000 grant from the European Commission.
Last January's Orange Bowl college football game generated $107.3 million for the local economy, with 77% of the 76,835 fans coming from outside south Florida. The figures were compiled by the Sports Management Research Institute.
Embattled freight consolidator Aerofloral has filed for Chapter 7 bankruptcy liquidation after management failed to secure additional credit for the Miami-based company. Aerofloral, which arranged flights and cargo operations for the cut-flower business, employed about 50 at the time it ceased operation. Some creditors say they may challenge the bankruptcy filing.
Former City of Miami Finance Director Manohar Surana has pleaded guilty to charges of accepting a kickback from a city contractor. Surana's arrest by federal agents in 1995 paved the way for a massive corruption probe that snared a city commissioner, the city manager and a high-profile lobbyist.
Norwegian Cruise Line says its popular Norway cruise ship will return to Miami late this year or early next year for Caribbean excursions. The refurbished Norway, which left Miami in September, was to be stationed in Asia in exchange for another ship.
A planned $5.4-billion expansion program at Miami International Airport will be scaled back as a result of uncertainties in the airline industry following September's terrorist attacks. Officials have not announced which projects they'll shelve. Meanwhile, the airport's former construction chief, Richard Mendez, has been indicted on charges of accepting $300,000 in bribes from contractors bidding on construction work at the airport. Mendez resigned last year.
Miami-Dade -- Miami-Dade's school board voted 6-3 to fire Superintendent Roger C. Cuevas. Board members accused Cuevas, 58, of withholding information on some issues and creating bad relations with the media.
The county has unveiled its first web portal, www.miamidade.gov, allowing users to pay parking fines, renew library books, apply for occupational licenses and access a range of other county information and services.
With 4,787 students graduated last year, Miami-Dade Community College awarded more associate degrees than any other school in the nation. The school also ranked first in number of degrees awarded to minority students.
The Beacon Council has named SunTrust Executive Vice President Thomas M. Cornish chairman for the year ending October 2002. The Beacon Council is Miami-Dade's public/private economic development agency.
Facing mounting opposition from homeowners and conservation groups, Houston-based utility giant Enron has backed away from plans to build a power plant in southern Miami-Dade near Biscayne National Park. Company officials say construction of the $130-million plant would have created as many as 600 jobs.
International Speedway Corp. (Nasdaq-ISCA) is buying the remaining 10% of Homestead-Miami Speedway it doesn't already own for an undisclosed amount. Homestead-Miami Speedway is home to NASCAR's Winston Cup, Busch Grand National and Craftsman Truck races.
Miami Shores -- Barry University has embarked on a $17-million construction program that will include a new student center, resident hall and parking lot. The program is the 61-year-old private university's largest ever. In the past 20 years, enrollment at Barry has grown from 1,750 to 8,600.