A PRR Will Cost You $150.00 In WPB
CRA Organization Chart Information received from WPB Dept. Internal Auditor.
CRA Board Mayor Keith James, Commissioners Fox, Lambert, Peduzzi, Ward and Warren.
Executive Director Christopher Roog
RMA Principals
Deputy Director & Administrative Assistant
Marketing Manager & Northwest Project Manager
Special Events Coordinator & Northwest/Pleasant City Manager
Real Estate Associate
“We note that the CRA structure has changed and the new Executive Director is now a City employee. All other personnel are employed by Redevelopment Management Associated (RMA) and are assigned to the City’s CRA by RMA.”
A resident sent a PRR on Mon, Aug 15, 2022 @ 1:00 pm which reads “part 2 Internal Audit Report on page 5 there is a Organization Chart that includes a Real Estate Associate. Please Name of Real Estate Associate, resume and salary” Received a response from the City, except the information he requested was not provided. See City response here. Sunset Lounge A.L. PRR
Mayor Kith James stated it is costing the City $26,000/month to operate the vacant Sunset Lounge at a CRA meeting when discussing the disqualified bidder (Vita) in what I believe was an attempt to push the Commissioners into a decision to decide on Mad Room. I can’t believe James is truthful and spending that amount of money on an empty building and placed a PRR.
My PRR sent 8/15/2022 @ 8:39AM. ” Please send me all invoices and receipts paid for the Sunset Lounge for the months of May, June and July for year 2022. Thank you in advance for your help.”
City responded Tue, Aug 16, 2022 @ 8:56 am with an Invoice. PRR will cost me $150.00. $75.00 deposit to start process and $75.00 on delivery. City states $200.00/per hour and apparently it will take 45 minutes. See invoice here. Sunset Lounge Invoice $150.00
CRA Management and Staffing Contracts:
“Up until 2013, the CRA was managed and staffed by the City of West Palm Beach. In 2013, a competitively bid contract to manage and staff the WPB CRA was awarded to Redevelopment Management Associates (RMA) for a three-year term to commence on January 1, 2014 for the amount of $41,000 per month from January 1 – February 28, 2014 and increased to $78,000 per month on March 1, 2014, for the remainder of the agreement. This monthly fee was subject to a 2.5% increase, effective October 1st of each year. Per the contract, the City of West Palm Beach had the option to extend the term for up to two additional years by the execution of a written amendment to the contract. After the extensions, the first contract was set to terminate on December 31, 2018. However, in September 2018, a new contract was entered into with an effective date of October 1, 2018, and it was not competitively bid. This contract, like the prior contract, is currently in effect for three years with the option to extend for an additional two years through the execution of a written amendment. The compensation for this contract is $99,750 per month and is subject to a 3% increase, effective October 1st of each year, which comes to a cost of about $6.4 million over five year.”
I attended the meeting in 2013 and recall when the CRA contract was discussed and approved and that was the first and last time a “Request For Qualification” and not a “Request For Proposal” process, meaning that the city wouldn’t attach a specific dollar figure to the bidding process. The City automatically renewed the contract, the only difference was RMA received a substantial raise every time, and there is no need to wonder why the City ” wouldn’t attach a specific dollar figure”
At the time Mayor James was Commissioner James and voted for approval.
The City may have placed Mr. Roog as Executive Director of the CRA although 7 employees of RMA are still running the show. Where are taxpayers dollars, now gone missing?
James and Johnson, the two that run the City with an iron fist is throwing good money after bad. A City where employee moral is at a all time low, many in fear losing their job.
Commissioners I write these stories for you as well as the residents of WPB for no other reason than to bring to your attention to what is happening in our City that “Staff” conveniently leave out of presentations. If James and Johnson want it staff better sell it or become another Phyllis Brooks, fired after 38 years of service.to a City she loved.
As far as the Sunset Lounge, which belong to the black community, in my opinion only a black management firm can properly run it.
I placed a call to Mr. Roog on Tues. 8/16/22 @ 11:22AM and left a message with my name and phone no. and requested a call back. I’m still waiting for the call.
The end
IA Report May 6, 2021 Part 2 + Surprise
West Palm Beach Community Redevelopment Agency Audit Part 2 Released May 6, 2021.
Unlike Part 1 of the audit, this report contains 23 pages, and sums up the report. Below are excerpts from the report and I urge readers to read it in it’s entirety.
1. Inadequate Controls and Oversight of CRA Expenditures
Condition Page 6
“Expenses Without A Project Code: 93 (15%) expense items were not allocated to a project code. We found that the project code assigned to these items was zero, instead of being allocated to a project code where costs could be tracked and accounted for. The CRA paid approximately $731,341 for the invoices related to these expenses.” Read the entire report for Criteria, Cause, Effect and Recommendation.
2. Insufficient Oversight of the Incentive Grant Program.
Condition Page 12
“The CRA offers Incentive Grant Programs that have specific guidelines and an application process that must be followed. Each Incentive Grant Award must be approved by the CRA board, We reviewed all 85 grant projects that were provided to us by the CRA including all 101 invoices submitted for reimbursement and found the following discrepancies:” Read the entire report for Criteria, Cause, Effect and Recommendation.
3. Fixed Assents Variances.
Condition Page 15
“During our review of the CRA’s fixed assets, we identified an area of concerns related to the City’s fixed assets. As of September 30,2020 the City had a balance of approximately $85 million of land recorded in the General Government and the balance included all departments that own land as well as the CRA. We found that $26 million (32%) of the $85 million was recorded as a lump sum value.” Read the entire report for Criteria, Cause, Effect and Recommendation.
4. Lack of Tracking and Monitoring of CRA Properties.
Condition Page 17
“We found that the process to track CRA owned properties was inadequate and ineffective. As such, the CRA could not confirm with certainty that the list of 95 properties that they identified as CRA owned properties was inclusive of all CRA properties.” Read the entire report for Criteria, Cause, Effect and Recommendation.
The IA (Internal Audit) Report could not have come at a better time due to the timing of the report and the controversy over the Sunset Lounge, and who will be chosen to manage it.
Below you will find the story by Investigative Reporter Terri Parker of WPBF (25) and Ms. Parker apparently requested a PRR (Public Records Request) from the city concerning the emails. Ms. Parker has included a three page letter dated 8/3/2022 from the Procurement Division to Mr. Ben Bush, Mad Room Hospitality, LLC and states Mad Room “violated the terms and conditions of the RFP” (Request For Proposal) Ben & Zach Bush are co-owner’s of Mad Room Hospitality.
Email from: Zach Bush to Keith James sent 6/27/2022 @ 11:15AM
Email from: Zach Bush to Joseph Peduzzi sent 6/28/2022 @ 9:04AM
Email from Keith James to Zack Bush sent 6/28/2022 @ 11:00AM. James points Mr. Bush to a project coming down the road and suggest he check it out.
The CRA should be abolished, there are many millions not accounted for and millions more spent in 2 areas of the city with no oversight. Easiest department to pilfer money from. No one watching.
Below is the IA Audit dated 5/6/2021
The end
Sunset Lounge–Starting Over!
Below are excepts from a newly released story on the Sunset Lounge and the ignominious failure the City made in their attempt to find an operator. My comments in Italic, entire story can be read below, and it contains links to stories on Channel 5 which makes for interesting reading.
FOX 29 WFLX
“Both potential operators of Sunset Lounge disqualified by city”
“It’s back to the drawing board to find an operator for a signature West Palm Beach redevelopment project.”
The latest twist comes after the city disqualified both of its bidders over alleged lobbying violations.
The city said Vita Lounge LLC, the minority group first selected, “blatantly violated” an ordinance against lobbying for the contract through Facebook posts and e-mails.
Vita denied the accusation and filed a lawsuit.
“The city then disqualified Mad Room Hospitality for allegedly making “courtesy contact with the mayor and a commissioner during the prohibited contact period.” Commissioner Peduzzi was the lone vote to approve Mad Room Hospitality along with Mayor James. Can we presume he was the Commissioner contacted?
In a statement to Contact 5 Thursday afternoon, the co-owner of Mad Room Hospitality said they were “improperly disqualified by a technicality.”
As a result of all of this, the city canceled the request for a proposal meant to find an operator to run the Sunset Lounge.
“The city’s community redevelopment agency said it costs about $26,000 a month to maintain the empty building.” $26,000 a month maintenance for an empty building. A PRR (Public Records Request) needs to be made. Readers were sent the Internal Auditors report on the CRA where millions were unaccounted for, what’s a few more thousand? Think about that when your trying to buy gas, food, money for the parking meters.
“A city spokesperson told Contact 5 that the CRA board will meet in the coming weeks to discuss the next steps and future operations of the Sunset Lounge.” Will meet in the coming weeks, not in a hurry to do what needs to be done, and give the contract to Vita who 4 Commissioners originally voted on before Commissioners Lambert and Ward changed course. Commissioners Fox and Warren stuck to their convictions to stay with Vita.
“Mad Room Hospitality was improperly disqualified by a technicality and the city, in my opinion, realized its error which is why they changed their course in posting the letter it did to DemandStar.” DemandStar, a company that handles Government Contract Bids, RFPs & Procurement. A PRR needs to be made to view the letter the city sent to DemandStar.
“We have requested from the City a letter rescinding their improper cancellation and we expect this to be forthcoming.”
“The city of West Palm Beach allows a responder to communicate with the city at the execution of a contract/agreement or once the solicitation stage has ended. It was clear then and remains clear now that the solicitation stage had ended.” Contract not signed.
“Ultimately, the City has to do what they feel is best for the community and we only want the best for the Sunset Lounge and the Historic Northwest District. Mad Room is not interested in pursuing this project further at this time.”
“For what it is worth, which we also made abundantly clear to the City–(which seemed to ruffle some feathers)-Mad Room does not feel Vita was treated fairly by the City of West Palm Beach.” Wow!
We certainly wish the City the very, very best in moving this project forward as the Community deserves and needs this project to flourish.”
https://www.wflx.com/2022/08/11/both-potential-operators-sunset-lounge-disqualified-by-city/
In closing the CRA has spent in the Downtown City Center a total of $174,271,223. Northwood/ Pleasant City $19,101,585. for a total of $ 193 million, 372 thousand, 808 dollars. I recently received part 2 of the Internal Auditors Report on the CRA, and that story will be coming shortly. Here are a few lines from the audit released.
Opportunities for Improvement
1. Inadequate Controls and Oversight of CRA Expenditures.
2. Insufficient Oversight of the Incentive Grant Program.
3. Fixed Assets Variances.
4. Lack of Tracking and Monitoring of CRA Properties.
In my opinion the city should seriously consider disbanding the CRA and stop wasting taxpayers dollars.
The end!
IA Report June 22, 2020 Part 1
My comments in Italic
IA (Internal Audit) report is lengthy and below is what jumped out at me. I have included the entire report below for your review. If you take the time to read it something may jump out at you that I missed.
The Internal Auditor (IA) dept. is overseen by the City Commissioners and the report (part 1) was issued when the dept. was severely understaffed.
IA Responsibility:
“Perform audits and provide services to help the City achieve the highest level of effectiveness and efficiency with uncompromised integrity. Promote compliance with laws, rules, regulations, policies, procedures, contracts, and agreements through reviews and analyses of the City’s services and activities.”
Contents: Page 3:
BACKGROUND Page 1
STATEMENT of SCOPE Page 2
STATEMENT OF OBJECTIVES Page 3
STATEMENT OF METHODOLOGY Page 3
STATEMENT OF AUDITING STANDARDS Page 3
AUDIT CONCLUSIONS AND SUMMARY OF FINDINGS Page 4
NOTEWORTHY ACCOMPLISHMENT Page 4
CRA ORGANIZATION CHART Page 5
OPPORTUNITIES FOR IMPROVEMENT Page 6
1. STAFF ASSIGNED TO THE CRA Page 6
2. MONITORING PURCHASES Page 9
3. COMPREHENSIVE OVERSIGHT OVER CRA ACTIVITIES Page 12
4. CONTRACT PROCUREMENT Page 14
RESPONSE FROM CITY ADMINISTRATION Page 16
RESPONSE FROM RMA (CONTRACTOR) Page 17
AUDITOR’S COMMENTS Page 18
ATTACHMENT A – PBC INSPECTOR GENERAL (IG) REPORT Page 25
ATTACHMENT B – GOVERNOR’S EXECUTIVE ORDER AND RELATED DOCUMENT Page 26
Page 1: Community Redevelopment Areas in the City of West Palm Beach:
“The CRA consists of two separate Redevelopment Districts the City Center Community Redevelopment Area, more commonly known as the Downtown CRA, and the Northwood/Pleasant City Community Redevelopment Area.”
CRA Funding:
“The primary funding source available to the CRA consists of Tax Increment Revenues. Tax Increment Revenues are a unique tool available to cities and counties for redevelopment activities and are used to leverage public funds to promote private sector activity in the targeted redevelopment areas.”
Page 2: CRA Management and Staffing Contracts:
“Up until 2013, the CRA was managed and staffed by the City of West Palm Beach. In 2013, a competitively bid contract to manage and staff the WPB CRA was awarded to Redevelopment Management Associates (RMA) for a three-year term to commence on January 1, 2014. In September 2018, a new contract was entered into with an effective date of October 1, 2018, and it was not competitively bid.”
CRA Revenues:
“From 2014-2019
“Downtown City Center CRA: $174, 271, 223” Appears to me the City considers Downtown the only area in need of improvement. The City should look at areas of the city that are pitch black at night. I’m sure residents would appreciate lighting.
Northwood/Pleasant City CRA: $19,101,58” Home of the Sunset Lounge. City (James) is concerned the City is paying a few thousands a month while waiting for MadMen LLC although the Commissioners approved Vita LLC the contract. He was a City Commissioner for 8 years, was not concerned about millions.
Total spent in 2 areas: $193,372,808.00, click to enlarge.
Page 3: Statement of Scope:
“The scope of the audit was from January 2014 through December 2019 (audit period) which is the period of time since the City outsourced the management and staffing of the CRA to RMA.”
Statement of Objectives:
“The objectives of the first part of this audit were to:
a. Determine whether the CRA was adequately staffed and had sufficient oversight over day-to-day operations; and
b. Determine whether CRA funds were used for CRA activities and properly accounted.”
Statement of Methodology & Statement of Auditing Standards. Also on page 3.
Page 4: Audit Conclusions and Summary of Findings:
“We concluded that there were opportunities to improve internal controls and management and oversight of the CRA operations. Specifically:
1. We found that some RMA employees assigned to the City’s CRA did not meet minimum qualifications for the positions they filled.
2. We found that there was inadequate oversight over the purchases made on City PCards such that p-cards were issued to non-City employees, purchases were not allocated to projects, purchases did not have sufficient justifications, and some purchases were not permissible under the P-Card policy.
3. RMA employees, acting as CRA staff, did not have comprehensive documented and/or established project management processes and procedures, that would have allowed them to independently provide comprehensive information on all CRA activities and the associated public funds.
4. The second contract with RMA did not go through a competitive bidding process, though it was approved by the Commissioners. We found that the supporting documents did not clearly indicate that a). a new competitive bidding process was required to obtain a new contract, and b). the Commissioners were being asked to waive this requirement. The procurement of the first contract was assessed by the Palm Beach County Inspector General’s Office and the report has been attached.”
Noteworthy Accomplishments:
“We acknowledge that the CRA under RMA’s management has been instrumental in improving various streetscapes and increasing community engagement through marketing and special events such as Bowties and Bourbon, the Heart and Soul Festival, and BBQ, Blues and Brews. We commend the Finance Department for taking immediate corrective action and deactivating the P-Cards.”
Page 6 – 8 Opportunities for Improvement
1. “Staff Assigned to the CRA
“Auditing standards indicate that disclosures should be provided when there are limitations or uncertainties with the reliability or validity of evidence. As such, we provide the following disclosures.
Over the course of audits, multiple attempts are made to obtain the data necessary to complete the review. Further, auditors follow up with audit clients to ensure that the data obtained is accurate. During the audits, we notify the audit client when we identify potential concerns and we provide sufficient information to facilitate a candid discussion. Specifically, we found the following concerns at the time the individuals were hired by RMA:”
Pages 6 -8 contain more info; and I encourage readers to take the time to read these 3 pages and notice the lack of over site from City leaders, concerning the contract with RMA not honoring the contract with unqualified employees earning from $95 to $155/hr. Two Employee closely related to RMA partner. It’s disgraceful.
Page 9-11:
Monitoring Purchases:
Condition
“The City’s Procurement Card Policy states that employees who have regular status with the City are eligible to obtain a purchasing card (P-Card). RMA’s contracts did not grant regular City employee status to RMA employees. RMA’s contracts clearly stated that some expenditures were subject to reimbursement and administrative fees and other expenditures could be paid for directly by the City. The contracts did not mention P-Cards. Based on our review, we found that an average of two RMA employees were issued P Cards with monthly spending limits of $10,000 per card and the majority of purchases were placed on an administrative assistant’s P-Card.”
Inadequate Oversight of Purchases
“From 2014 through 2019, there were about 1,040 P-Card transactions totaling about $253,000. Based on our review, we found insufficient oversight of purchases made as follows: For example, we identified purchases for:
1. Award luncheons/banquets and applications for awards (over $4,000),
2. Gift Cards (over $2,000), and
3. Work pants and shirts for RMA Employees (over $2,500).”
Once again I ask readers to read pages 9-11 for more shocking disclosures of the CRA and RMA.
As I have mentioned multiple times the importance of the WPB Internal Auditor Department, and Beverly Mahaso, Chief Internal Auditor, and her limited staff, who gave the City a straight forward and balanced report to help the city with it’s problem solving. If not for them we would not be aware on the millions of taxpayer dollars wasted, and/or missing. The good news is the City has not renewed the contract with RMA, and it is now being overseen by Christopher Roog, Executive Director of the CRA. Will the City do anything to re-coop money wasted by abuse? I doubt it. Let sleeping dogs lie.
The end!