Professor Frank Schnidman, J.D., LL.M.

Henry D. Epstein Distinguished Professor of

Urban and Regional Planning, and
Executive Director, Center for Urban
and Environmental Solutions (CUES)
School of Urban and Regional Planning
777 Glades Road, Bldg. 44, SO 284
Boca Raton, FL 33431
tel: 561.297.4166
cell: 954.599.8715
E-Mail: schnidma@fau.edu

MEMORANDUM
TO:
FROM:
DATE:
RE:

HELEN FERRE
FRANK SCHNIDMAN
DECEMBER 4, 2014
COMMENTARY ON HOLLAND & KNIGHT OPINION AND
PEREZ ART MUSEUM MIAMI (PAMM) MEMO REGARDING
THE $1 MILLION, ONE YEAR, OMNI CRA SUPPORT OF
PAMM PROGRAMMING, MARKETING AND PUBLICITY

SUMMARY
As requested, I have read the Opinion by Holland & Knight regarding the Onmi CRA
grant to the Perez Art Museum Miami (PAMM) of $1 million dollars, and as promised,
below are my initial observations and commentary.
The Holland & Knight Opinion by Richard A. Perez, provided by letter to Omni CRA
Executive Director Pieter Bockweg, dated July 18, 2014, is in my opinion, aggressive
in its reading of the Advisory Legal Opinion of the Attorney General (2010-40), of the
Community Redevelopment Act and of the Omni Community Redevelopment Plan
Update. The letter gives an opinion that the Omni CRA may spend tax increment trust
fund money targeted for slum and blight alleviation to pay for programming, marketing
and publicity costs of PAMM intended to promote the community redevelopment area
and attract visitors and students to the community redevelopment area.
The Holland & Knight Opinion appears to be written to justify the requested financial
support, and the analysis undertaken is not as clear-cut as the Opinion states. In addition,
the PAMM letter to Omni CRA Executive Director Pieter Bockweg, dated July 15, 2014,
outlines a series of programs, marketing and publicity efforts with no data or
measurements to actually show the alleged benefit to the CRA.
Problematic is that on July 7, 2014, among others, CBS News reported on the recent
budget and financial situation of the PAMM in a feature entitled, Perez Art Museum
1

Asks County to Help Fill Budget Gap. In that news item, CBS reported that the 2015
County budget will reportedly earmark $4 million for the museum which also wants a
million dollarsfrom Miamis Omni Community Redevelopment Agency.
And, as recently as December 1, 2014 the Miami Herald reported in A Banner First
Year for Miamis Bayside Art Museum, that PAMM was struggling financially and that
The saving grace was a $1 million grant from the city Omni redevelopment agency,
which helped it extend its educational programs, though that money may be unavailable
next year
An important question then is if the request to the CRA for this one year $1 million
payment is simply for ongoing planned programming, marketing and publicity, with a
justification to have the CRA make up the operational shortfall because, as the CBS news
report states, Private dollars used to fund the non-profit museum have not kept pace with
the increase in operating expenses. And, it appears that this request for $1 million
dollars for programming, marketing and publicity support may actually be an annual
request from PAMM to the Omni CRA. As reported, the CRA Executive Director stated
The agency will evaluate the results of the one-year grant when it expires and then
decide whether to renew it
The analysis, justification and decision-making that led to the approval of the grant
request was likely not effectively challenged because there is no ombudsman to represent
the stakeholders in the CRA to force a more rigorous analysis and justification for the
expenditure of trust fund money earmarked for the alleviation of slum and blight
conditions.
DISCUSSION
Bicentennial Park, renamed Museum Park, was originally not within the Omni CRA.
The CRA boundary was expanded in 2009 as part of the Global Agreement, allowing, if
appropriate, Omni tax increment fund money to be spent on Museum Park. By 2013,
according to their Annual Report, the Omni CRA had spent approximately $14 million on
site clean up and development costs.
The PAMM Letter of July 15, 2014
The PAMM letter in its opening paragraph recognizes that the Omni CRA was one of
many providing initial funding for the PAMM and Museum Park. In the second
paragraph PAMM mentions In preparation for the opening, PAMM developed several
important new programsdescribed in the attachment to this memorandum The letter
goes on to state that attendance the first 6 months exceeded expectations, over 185,000
visitors, and boldly states that attracting visitors to the PAMM is thereby helping to
meet the OMNI CRAs goal to eliminate slum and blight and attract businesses to the
OMNI CRA. However, there are no data, no specifics, to explain how attracting visitors

to the PAMM actually results in meeting the CRA goal to eliminate slum and blight and
attract businesses to the Omni CRA.
The letter also goes on to state that PAMMs education programs are also exceeding all
expectations in terms of service: in the first five months, over 8,300 children attended
programs with 12,000 projected by the end of the school year, free guided drop-in tours
are offered four times each day; and over 2,600 visitors participate each month in PAMM
Free Second Saturdays, which features hands-on activities for children and adults. It
seems that the programming that the PAMM now seeks support for has already been
implemented, and that the Omni CRA trust fund is being asked for support to continue
programming, not support new programming.
In concluding the letter, PAMM states that Attached you will find a description of the
programs that PAMM has designed to solidify the PAMM as a cornerstone for the OMNI
CRAs goal to end slum and blight within its boundaries, expanding its audiences and
outreach to the community. Again, there is no data, no information to support this
assertion, which on its face is difficult to understand how there could be such a
relationship. And, it appears that since the PAMM is having budget challenges, the Omni
CRA tax increment trust fund is being asked to cover operating expenses of the
programs, marketing and publicity activities that already exist or are already planned.
$1million for one year is requested from the Omni CRA to subsidize programming,
marketing and publicity. Again, there is no data, no measurement of how having people
come to a free-standing museum creates feet on the street that will foster other activity
in the Omni CRA. In addition, $245,000 of the request, almost of the total funding
requested for 2015, will go to Marketing and Publicity Initiatives. And the description
sounds much like promoting tourism, and certainly is not as targeted to benefit the Omni
CRA slum and blight alleviation goal, as the text seems to indicate. As will be discussed
later in this memo, the promotion of tourism is not an appropriate use of CRA tax
increment trust fund money.
And, in ending the letter, the PAMM mentions Sponsor Recognition Benefits,
including the Omni CRA as if it were just another donorThe recognition benefits
outlined above are commensurate with those provided to all contributors and sponsors at
comparable dollar levels. It also specifically mentions the benefit of being recognized
on the PAMM website. Here is an example of the recognition, found on the bottom of
pages of the web site:
Accredited by the American Alliance of Museums, Prez Art Museum Miami (PAMM) is sponsored in part by the State of Florida,
Department of State, Division of Cultural Affairs, and the Florida Council on Arts and Culture. Support is provided by the MiamiDade County Department of Cultural Affairs and the Cultural Affairs Council, the Miami-Dade County Mayor and Board of County
Commissioners. Additional support is provided by the City of Miami and the Miami OMNI Community Redevelopment Agency
(OMNI CRA). Prez Art Museum Miami is an accessible facility. All contents Prez Art Museum Miami. All rights reserved.

The Holland & Knight Letter of July 18, 2014

This letter with the Opinion is written to provide the Omni CRA with support and
justification to grant the PAMM $1 million for operating and promotional support.
Because the language of the Community Redevelopment Act in many sections is general
in nature, many sections can be read to allow a variety of activity. The Opinion tries to
tie together the purpose of a CRA (sec. 163.356(1)) with the definition of community
redevelopment (sec. 163.340(9)) and a section that allows spending money for items
included in the community redevelopment plan (sec. 163.387(6)).
The Holland & Knight Opinion also cites Fl. Aty. Gen. Opinion 2010-40, but overstates
the meaning of the language of the Attorney Generals Opinion. Holland & Knight states:
In recognition that the concept of redevelopment of a slum and blighted
area deals with more than just addressing brick and mortar issues, the
Florida Attorney General has opined that to read the statute as precluding
the promotion of a redevelopment area once the infrastructure has been
completed would be narrowly viewing community redevelopment as a static
process. See, Fl. Aty. Gen. Opinion 2010-40. In that opinion, the Florida
Attorney General discussed whether a community redevelopment agency
could (i) provide funds to festivals/street parties to promote economic
development/tourism and (ii) provide grants to non-profit entities providing
socially beneficial programs. The Attorney General concluded that
expenditures directly related to promoting the community
redevelopment area, including street festivals and events, are
legitimate expenditures, but that expenditures to generally
promote tourism or to generally achieve social objectives are not
legitimate expenditures of a community redevelopment agency.
(Emphasis added by bold italics.)
What the Florida Attorney Generals Legal Opinion actually states is:
As discussed above, it would appear that the primary focus of a community
redevelopment agency is to eliminate and prevent the development or spread
of slums and blight. This may be accomplished by reducing or preventing
crime, by providing affordable housing, clearing slums and redeveloping in a
community redevelopment area, or any combination or part thereof. The
enumerated uses of community redevelopment trust fund moneys
are likewise couched in terms of redevelopment activities
involving bricks and mortar in a manner of speaking, rather
than promotional campaigns to encourage people to populate the
area once the redevelopment has been accomplished. However, to
read the statute as precluding the promotion of a redeveloped area
once the infrastructure has been completed would be narrowly
viewing community redevelopment as a static process.

Accordingly, I cannot say that the use of community

redevelopment funds would be so limited that the expenditure of
funds for the promotion of a redeveloped area would be prohibited
However, grants to entities which promote tourism and economic
development, as well as to nonprofits providing socially beneficial
programs would appear outside the scope of the community
redevelopment act.
(Emphasis added by bold italics.)
Therefore, from the language of the Attorney Generals Opinion, it clearly does
not conclude that (ii) the Florida Attorney General has opined that community
redevelopment agencies may legally expend money on projects focused on promoting the
community redevelopment area as the Holland & Knight Opinion states. Note also that
the Attorney Generals Opinion states that:
However, grants to entities which promote tourism and
economic development, as well as to nonprofits providing
socially beneficial programs would appear outside the scope of
the community redevelopment act.
Therefore, providing socially beneficial programs would appear outside the scope of the
community redevelopment act. Note also that in discussing this area of the Attorney
Generals Opinion, the Holland & Knight Opinion reads the language as or to
generally achieve social objectives are not legitimate expenditures
Not only does the Attorney Generals Opinion lack the support alleged to justify the
expenditure of tax increment trust fund slum and blight alleviation money on the socially
beneficial programming of the PAMM, it also lacks the support alleged for PAMMs
tourism promotion, marketing and publicity expenditures.
In addition, the Holland & Knight Opinion cites the Omni Community Redevelopment
Plan Update as a justification for the expenditure of the trust fund money in support of
the programming, marketing and publicity activities of the PAMM. Quoting from the
Opinion:
With respect to the Omni CRA, the Omni Area Community Redevelopment
Plan recognizes (a)s a cornerstone of the redevelopment effort, the Plan
Update seeks to build on the anticipated success of the Performing Arts
Center by providing a framework for the creation of a sustainable
cultural, media and entertainment district which will catalyze the
redevelopment of those western areas most affected by slum and blight
conditions. The Plan recognizes the great potential to reinvigorate the
Omni area by establishing it as a cultural destination that includes a
multitude of arts and entertainment venues.
(Emphasis added by bold italics.)

The conclusion then reached from the reading of the Community Redevelopment Plan
Update is that the Omni Area Community Redevelopment Plan recognizes that
creating and sustaining cultural institutions within its boundaries is a cornerstone to its
redevelopment efforts In a manner, this may be so as the Plan recognizes the
importance, but it does not say that the CRA should be the creator or sustainer through
the use of tax increment trust fund slum and blight alleviation money. Again, what the
Community Redevelopment Plan Update states is that as a
..cornerstone of the redevelopment effort, the Plan Update seeks to build on
the anticipated success of the Performing Arts Center by providing a
framework for the creation of a sustainable cultural, media and
entertainment district which will catalyze the redevelopment of those western
areas most affected by slum and blight conditions.
(Emphasis added by bold italics.)
CONCLUSION
The Holland & Knight Opinion ends with:
As such, because (i) the Omni Area Community Redevelopment Plan
recognizes that creating and sustaining cultural institutions within its
boundaries is a cornerstone to its redevelopment efforts and (ii) the Florida
Attorney General has opined that community redevelopment agencies may
legally expend money on projects focused on promoting the community
redevelopment area, I am of the opinion that the Omni CRA may fund
activities of the PAMM intended to promote the community redevelopment
area and attract visitors and students to the community redevelopment area.
The PAMM Proposal, as drafted, is generally consistent with these goals.
As has been described above, the basis of the Opinion that the CRA may fund the PAMM
activities is an aggressive interpretation of the language of the Community
Redevelopment Plan and the Attorney Generals Legal Opinion. A clear reading of the
Plan and the Legal Opinion, not based upon the need to justify the proposed CRA action,
would not necessarily come up with the same conclusion.
It appears that the Community Redevelopment Act sections, the Omni Community
Redevelopment Plan Update language, and the Attorney Generals Legal Opinion cited
do not provide the justification to allow the CRA to fund the programming, marketing
and publicity activities outlined in the PAMM letter of July 15, 2014.
In order to prevent the diversion of tax increment trust fund slum and blight alleviation
money to this type of programmatic, promotional, marketing and publicity use, serious
consideration needs to be given to a comprehensive examination of the 45-year old
Community Redevelopment Act. Such an analysis will identify amendments that may be
needed to provide clear direction regarding the appropriate use of these trust funds by

those seeking to truly engage in redevelopment activities, as opposed to those seeking to

use the trust fund moneys to support politically popular projects or programs, regardless
of whether or not they are appropriate under the goals and objectives of the Community
Redevelopment Act of 1969.