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Florida Small Business



May 27, 2018

Stuck in the Slow Lane

David Villano | 6/1/1999
Tolls, taxes or both? That's the question Miami-Dade County officials are debating as they race to meet an October deadline for securing new taxes or other locally generated funds for transportation projects. Without such specific, "dedicated" funding, the county could miss out on billions of dollars in federal grant money.
"Our transportation infrastructure is on its way to crashing," says Allen Harper, chairman of the Greater Miami Chamber of Commerce's Transportation Committee. Harper believes the region's overcrowded roadways and inadequate mass transit system already deter corporate relocations. Miami-Dade is now the third most congested metropolitan area in the U.S., after Los Angeles and Washington, D.C.
Last year county officials approved a massive transportation blueprint for new roads, an expanded fleet of buses and extensions to the elevated mass-transit network, Metrorail. Total cost: $15.8 billion over 20 years. Only $7.2 billion of that total has been secured, however. Runaway growth doesn't come cheap, officials acknowledge.
While federal funds to pay for improvements are available, new rules encourage what few Miami-Dade leaders have had the stomach to endorse: taxes. Voters have rejected a one-cent sales tax increase for transportation three times in recent years. And in February, after an independent state agency doubled tolls on the county's expressways, Miami-Dade Mayor Alex Penelas and other local officials exploded with outrage. Another toll increase will take effect in 2001. The officials who allocate federal aid put a lot of weight on a community's ability to maintain and operate new roadways and mass transit systems.
But the toll increase may have served as a slap in the face to wake up Miami-Dade residents, helping to shift public sentiment in favor of new taxes. Sensing that shift, Penelas proposed a tax-for-tolls swap: Eliminate the tolls following a one-cent sales tax increase. Such a tax would generate about $240 million annually. The problem with Penelas' proposal is that a countywide vote on the tax could take a year to get on the ballot - long after the October deadline for having funding in place. Federal officials have made it clear that the mere prospect of dedicated funds won't suffice. What's more, critics note, the Penelas tax would not be truly dedicated. Some of the money would go for libraries and social service programs. Others want to know if the tax would supplement or replace the $100 million in general funds the county already spends each year on transportation. Meanwhile, the possibility that the tolls could be eliminated is threatening a planned bond issue for road improvement that's backed by revenue from the tolls.
Sonny Holtzman, chairman of the Miami-Dade Expressway Authority, the agency that oversees the county's toll roads, says local leaders only have themselves to blame. "The county was asleep at the wheel, " he says. "Transportation only became an issue when someone realized that billions of dollars in federal money were at stake and they had done nothing to get ready to ask for it."

In the news ...

Boca Raton - Just how bad a year was it for Sunbeam? The world's largest maker of consumer home and kitchen appliances posted a net loss in 1998 of nearly $900 million on net sales of $1.8 billion. The company (NYSE-SOC), which owns the First Alert, Coleman, Oster and Mr. Coffee brands, fired its controversial Chairman "Chainsaw" Al Dunlap last June amid allegations of financial irregularities. Much of the 1998 loss stemmed from one-time charges related to litigation and restructuring.

Broward - California-based Beverages & More! is closing its three south Florida outlets less than two years after arriving. Plans to open as many as seven more have been cancelled. The company, founded by a former Office Depot executive, had hopes of becoming a nationwide chain of superstores specializing in beverages and gourmet foods.

Fort Lauderdale - Reflecting an increasing emphasis on automobile retailing and rentals, Wayne Huizenga's Republic Industries has changed its name to AutoNation (NYSE-AN). Following its planned sell-off of its solid-waste subsidiary, Republic Services, AutoNation will consist of three automobile rental companies, 45 AutoNation USA used-car outlets and nearly 400 new-car dealerships.

Gerald Stevens Inc., a retailer and marketer of flowers and floral merchandise, merged with Vero Beach-based Florafax International, a leading flowers-by-wire provider. Publicly traded Florafax, with sales of $13.3 million in 1998, will take the name Gerald Stevens. The company, formed in January 1998 by former Blockbuster executives, had been privately held. Gerald Stevens now trades on Nasdaq under the symbol GIFT.

Hollywood - With the physician-practice management industry fast losing favor on Wall Street, a group of senior executives has orchestrated an investor buy-out of Sheridan Healthcare (Nasdaq-SHCR). The company, which owns about 230 physician practices, mostly in south Florida, says it will sell unprofitable practices and focus on medical specialties, such as anesthesiology, rather than on primary care.

Miami-Dade County - Twenty-two of Miami-Dade's leading companies announced that they will contribute a total of $3 million each of the next three years to fund an international marketing campaign to lure new businesses. Beacon Council President Frank Nero says the initiative is needed to counter the commonly held image of Miami-Dade as a community beset with crime, corruption and governmental mismanagement.

A wide-scale corruption probe at the Port of Miami has claimed its first casualty. Hialeah City Councilwoman Marie Rovira has pleaded guilty to charges that she collected a salary for a phantom port position. Also under investigation: former port director Carmen Lunetta, charged with misusing public funds to pay back political favors.

To the relief of local development officials, Burger King Corp. will remain in south Florida. The company, founded in Miami in 1954, announced last year that it would vacate its 10-year-old South Dade headquarters. Officials now say that if a new lease agreement can not be reached, the company will move to another location within Miami-Dade or Broward counties. Burger King employs about 550 full-time employees and another 250 independent contractors.

AAS Amjet, a Miami company specializing in aircraft engine overhauling, will add about 100 new jobs following a move later this year to a new facility in South Dade. AAS Amjet, which currently employs 60 people, is a subsidiary of American Aircarriers Support of Fort Mill, S.C.

The total number of visitors in Miami-Dade was down in 1998, but visitor spending was up. Tourism officials say a weak Canadian dollar, fiscal turmoil in Brazil and a relatively mild winter in the northern U.S. helped drop total overnight visitors to 9.7 million - a 1.1% decline. But those who came stayed longer - an average of 6.6 days versus 6.3 days in 1997. Total spending by overnight visitors to the county was up 3.3% to $12.1 billion.

Miami Shores - Barry University finalized its purchase of the University of Orlando School of Law. The newly named Barry University of Orlando School of Law will apply for accreditation from the American Bar Association this fall, with a decision expected in early 2000.

West Palm Beach - Florida is one of 18 states in the running to manufacture the VentureStar reusable space vehicle. Lockheed Martin, under NASA contract to develop the vehicle, will make the selection in late 2001. The unmanned VentureStar will launch vertically, like a rocket, and land horizontally. The Business Development Board of Palm Beach County estimates the economic impact of the project at some $450 billion over the first five years.

Miami-Dade County tourism leaders are bracing for a tough summer. A recession in Brazil - the county's No. 2 source of international visitors - is keeping Brazilians home, and those who do make the trip are spending less. It will take at least six months for Brazil to get its house in order. Looking ahead, other problems cloud the international trade picture. Venezuela also suffers from recession and political uncertainty, and Honduras and the Dominican Republic are still struggling to recover from Hurricane Mitch. Miami-Dade's trade economy is diversified enough to avert a full-blown crisis, but most business sectors can expect to feel some pain.

Tags: Florida Small Business, Politics & Law, Southeast, Business Florida

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