As shocking as it is that then-North Miami Interim City Manager Duke Sorey thought he was entitled to go on a MILLION DOLLAR SHOPPING SPREE with YOUR money, it’s much worse than anyone could have imagined.
As bad as the $1,361,618 price tag is, that figure doesn’t even include the additional (and totally unnecessary) millions of dollars that North Miami taxpayers are now on the hook for until December of 2033.
But, what does Duke Sorey care? It’s not HIS money!
Let’s start with the three Commercial Leases the City entered into with the corporate owners of the “Denmark property” in exchange for a Settlement Agreement in lieu of foreclosure. This property consists of three adjoining parcels of land that together form an L-shaped piece of vacant land, which was converted into Duke Sorey’s Red Garden Sinkhole.
Here’s how it all started.
On December 12, 2017, the City of North Miami filed three Foreclosure Complaints against Alhambra Heights 12351, LLC, Alhambra Heights 635, LLC, and Alhambra Heights 645, LLC, for the non-payment of code violation liens as far back as July 11, 2012. These three companies owned the three parcels of land collectively referred to as the “Denmark Property.” The three Foreclosure lawsuits were filed due to unpaid liens owed by the Denmark Property to the City of North Miami in the aggregate amount of $1,319,655.34.
Six months later, the Defendants finally filed their Answers and Affirmative Defenses, asking the Court to stop the foreclosure action because of “exigent circumstances.”
Oh, and Hurricane Irma.
Never mind that Irma hit South Florida in 2017 – five years after the “Denmark Property” was first cited by North Miami Code Enforcement, but whatever.
By the fall of 2018, the parties entered into a series of mediation conferences. By May of 2019 a Settlement Agreement had been reached, and on June 7, 2019 all three Foreclosure Complaints were voluntarily dismissed.
That was just the first of many stupid decisions made by then-North Miami City Manager Larry Spring and Deputy Duke Sorey.
But, what does Duke Sorey care? It’s not his money!
From a legal standpoint, the City had every right to foreclose on the property due to the $1.3 million in unpaid liens. It also appears that North Miami had an excellent chance of winning all three lawsuits, and taking possession of a property that, according to the Miami-Dade County Property Appraiser’s Office, had a market value of $1,808,579 in 2019. This year the value has increased to $2,138,349.
So, let’s think about this for a minute.
If North Miami had followed through on its litigation, the City would eventually own the Denmark property free and clear – and tax-free to boot! North Miami pays no real estate taxes on city-owned property.
In addition, this property is located within the North Miami Community Development Agency (CRA), which agency can use its own tax increment financing for redevelopment, thereby leaving the City’s General Fund untouched.
Instead of obtaining this property in a foreclosure action, the City of North Miami foolishly entered into a Settlement Agreement, which resulted in:
- The owner of the Denmark property keeping his land and having $1,319,655.34 worth of liens wiped out; and
- The City of North Miami losing $1,319,655.34 in revenue and getting absolutely nothing in return.
But, what does Duke Sorey care? It’s not his money!
North Miami is now renting a property that it voluntarily gave up in a settlement for $8,000.00 per month, or $96,000 a year, for five (5) years (with two 5-year renewal options) with annual increases of 4%.
So, instead of owning a mortgage-free, tax-free parcel of land with a market value of $2,138,349, North Miami taxpayers now have to pay rent for that property in the total amount of $1,941,455.64 over the life of the lease.
With absolutely nothing to show for it in 2034 when the property is turned back over to the owner.
But, what does Duke Sorey care? It’s not his money!
Hey, Duke …
We’re not done.
More sticker shock came at the July 14, 2020 meeting when the Mayor and Council were expected to vote on TAB B of the Agenda, which was a resolution “providing for ratification of the action taken by the City Manager during the winter recess.”
You will recall that at the December 10, 2019 Regular Council Meeting, the Mayor and Council voted to approve Resolution No. 2019-R-85, “AUTHORIZING THE CITY MANAGER, CITY ATTORNEY AND CITY CLERK TO TAKE ALL NECESSARY ACTION AND TO EXECUTE ALL DOCUMENTS AFFECTING THE HEALTH, SAFETY AND WELFARE OF THE CITY DURING THE CITY COUNCIL’S RECESS COMMENCING DECEMBER 11, 2019 THROUGH JANUARY 13, 2020; PROVIDING FOR AN EFFECTIVE DATE AND FOR ALL OTHER PURPOSES.”
When the Mayor and Council left the “HEALTH, SAFETY AND WELFARE OF THE CITY” in the hands of then-City Manager Larry Spring, his Deputy Duke, and City Attorney Jeff Cazeau, they had no idea how much damage the three of them could do in 33 days.
While the alleged adults were on a month-long vacation, the children in charge, i.e., City Manager Larry Spring and his Deputy Duke, negotiated four overpriced contracts and approved five expenditures way over the Council approved limit of $25,000.
And without a bidding process, we might add.
It gets worse.
On the 20th of December, 2019, nine days after the Mayor and Council went on hiatus, then-City Manager Larry Spring, on behalf of the City of North Miami (Lessee), sneakily entered into a 14-year, Commercial Lease with M2J2 Realty Group, L.L.C. (Lessor) for two parcels of land, as follows:
- A 13,500 square foot lot, including a one story office building located at 660 NW 125 Street, which is on the same block as the Red Garden, but not adjacent to it.
- A 14,677 square foot vacant lot, referred to as the “YARD,” located directly behind the Red Garden property.
It’s important to note that this is a “Triple Net Lease,” which means the City of North Miami is responsible for the payment of all real estate taxes and property insurance, as well as maintenance and utilities. The base rent for this property is $8,500.00 for the first year, but that’s just the beginning.
In 2019, the property taxes on this corner lot property were $10,156.88, and the taxes for the YARD were $6,803.39, for a total real estate tax bill of $16,960.27.
According to the Commercial Lease, the City will be paying $10,633.83 a month!
And that’s just for the first year, which will cost North Miami taxpayers A GRAND TOTAL OF $127,605.96!
On December 20th of each year beginning in 2020, the base rent increases by 3%, until December 20, 3033, when the Lease expires. By that time, the base rent alone will be $15,351.94 per month, or a total of $184,223.28 per year PLUS taxes and insurance.
The base rent alone will end up costing North Miami taxpayers total amount of $1,941,455.64.
Add the real estate taxes and insurance at today’s cost of approximately $25,600 per year, or an additional minimum cost of $358,400, and you’re looking at a grand total of at least $2,096,091.23 over the life of the lease.
And once again, when the lease expires North Miami taxpayers will have absolutely nothing to show for it when the property is returned to the owner.
But, what does Duke Sorey care? It’s not HIS money!
Oh, and about that lease.
As you probably know, we have always had the utmost respect for Mr. Cazeau. And we’ve rarely disagreed with his legal opinions. That being said, his only job is to protect the best interests of the City.
And by City, we mean the residents of North Miami who foot the bill for Jeff’s $304,000 annual salary and incentives.
When questioned about all the contracts approved while the Mayor and Council were on hiatus, City Attorney Jeff Cazeau’s pat response was that he reviewed them for “legal sufficiency” only.
Even if he reviewed the M2J2 Realty Commercial Lease for “legal sufficiency” only, we can’t help but wonder how he missed this clerical error in the “LEASE PAYMENTS” schedule, which inadvertently added seven years to the 14-year agreement.
Of course, North Miami will only be responsible for 14 years of lease payments, according to the terms of the Commercial Lease, and not 21. Still, you’d think an attorney would have caught this error before it was signed. Obviously, no one was paying attention.
Just saying.
When the Mayor and Council went on their winter hiatus, they had every reason to believe that City Manager Larry Spring, Deputy City Manager Duke Sorey, and City Attorney Jeff Cazeau would do everything in their power for the benefit of the “HEALTH, SAFETY AND WELFARE” of North Miami.
Or, at the very least, not spend $6,564,184.62 of taxpayer money …
… So Deputy Duke could could be the Master of Ceremonies for the Super Bowl Party of his life.
But, what does Duke Sorey care? It’s not HIS money!
IT’S YOURS!
We’ve said it before, but it certainly bears repeating.
Considering all the trouble he’s caused by his fraudulent budgets, deficit budgets, hiring friends and family, firing whistle-blowers, contracting high priced consultants, furloughing working class employees, and the constant withholding of public records, it’s a miracle that Duke Sorey still has a job.
Hopefully, not for long.
North Miami residents deserve better.
Stephanie
Curious. Does the Deputy City Manager work at the pleasure of the Council or the City Manager? In other words, can the Council terminate his employment or must it be the City Manager?
Also, would an errors and omissions insurance policy cover the costs of this? The position of City Manager is a fiduciary position and as such, I believe there is a bond requirement.
Let’s hope that the City Council takes action on this.
Sorey is no longer a contract employee of the Mayor and Council. They had the chance while Duke was the Interim City Manager, but that window of opportunity is now closed. The only person who has the power to fire him is the City Manager. She wasn’t in North Miami until July 1, 2020, so she’s not responsible for any of this mess. I have no idea what her plan is.
I’m so disappointed in Jeff Cazeau for his part in this disaster. It all started when he gave the green light to Larry Spring and Duke Sorey to concoct the Super Bowl party and sign all those contracts. I know at least two of the council members are also upset. He should have known better.
I’m not sure about the insurance question, but it would be interesting to find out.
Please tell your readers who proposed this idea and launched this whole Super Bowl party, Jeff Cazeau, Duke Sorey, or Larry Spring?
Ultimately the entire council should be upset, especially Alex Desulme since it took place in his district. How do you explain this to your constituents whom you are supposed to look out for? Health, Safety and Welfare? What are the benefits the citizens in district 4 or throughout the city that were received from this deal? If I am not mistaken this is a $4 million loss for the city. Please correct me if I am wrong.
We will have to wait and see what the new budget proposals are and if the property taxes, sanitation, water and sewer rates will be increased. It is hard to recover these big amounts of loss and can take years. In the end it’s hard working citizens who are paying for it.
As stated previously, the council should lead by example and take big pay cuts like the employees who had no say or part in these decisions for the past year and years had to.
After all this who wouldn’t want a deal like this? I bet the Denmark’s are loving it.
I still have no idea which one of those cooked up this hare-brained scheme, but I’m sure it wasn’t Jeff Cazeau.The problem is that Jeff didn’t seem too interested in talking any sense into the other two. Larry and Duke were bound and determined to have their “pop-up” venue, and unless they were about to do something illegal, there’s nothing Jeff could have done to stop them.
But, just because something may or may not be illegal, that doesn’t make it ethical, prudent, or fiscally responsible. Clearly, the Red Garden Sinkhole was none of those.
The only winner was Mr. Denmark, who walked away with the deal of a lifetime.
Courtesy of North Miami taxpayers.
By the way, this would never have happened under a different mayor’s watch, i.e. Mac-Kinley Lauriston. But Bien-Aime had “free” turkeys and $40 bags of groceries to give away, so there’s that.
You said it. Mr. Denmark hit the lotto. His attorney should be proud and well paid for negotiating that deal. Thanks for keeping the citizens apprised with all your hard work and research.
Mr. Denmark was the clear winner in this deal, while North Miami residents got screwed. Again. Why aren’t the Mayor and Council members more upset? They are the ones who got hoodwinked by their charter employees – including, and especially, Duke Sorey, who was Deputy and then Interim Manager during the entire deal. Heads should roll.
I’m optimistic that with this new city manager NoMi is going to make some drastic changes in regards to fiscal policies. NoMi has so much opportunities and in due time they will eventually leverage it for the economic advancement of community stakeholders.
Rudy, Bill, Stephanie, Laura, and anybody else who has any common sense in North Miami which we have many people who are smart, educated, and informed in our city affairs …
What type of business or other entity that we can place on these properties that could be turn around and become an asset to our city with this type of one-way favorable lease to the Denmark’s family? ….
1) You can’t build a city branch library, mini city hall, and/or replacement for our outdated Metro Miami -Dade County fire station located at 650 NW 131 Street on this leased property because it reverts back to Denmark’s family in 2034?
2) You can’t attract a high quality business entity like a WaWa which will pay good wages and benefits at this property because it is not situated at a prime commercial corner like NE 167 Street and NE 6 Avenue?
3) You can’t attract a high quality fast food entity like Chick-a-Fil which has change their corporate polices or a Culver’s Restaurant to this property because you have four other chicken based fast food restaurants on the same six block strip (i.e. KFC, Pollo Tropical, Popeye’s, Finga Licking) or two traditional fast food restaurants (i.e. Burger King and Checkers)?
4) You can’t attract our traditional low-end business establishments like Dollar’s Tree, Family Dollar, or 7-Eleven because they are already situated at either NW 119 Street and NW 135 Street/Opa Locka Boulevard like welcome signs to our city?
Please tell me what you can put on this land tract and turn it around to the benefit of North Miami’s taxpayers and/or residents?
I do know what we should put as an entry sign into our city: “Welcome to North Miami … World Capital of Dollar Stores, Convenient Gas Stations, Fast Food Restaurants, and Some Village Idiots”!
Previously, I had a lot of faith with our city attorney, Jeff Cazeau, however, we lost my faith when he review this terrible lease and allow our appointed officials and himself to sign off this terrible one-way lease without the approval of our city council. We are taking a major financial commitment by our city without any public input or approval on this 15 year lease with the Denmark’s family.
How about a funeral home. Because North Miami doesn’t have enough of them.
Nursing homes and assisted living facilities too.
Jim
WaWa wanted to come to 135 and NE 6th and was turned down by Zoning
Chick Fil A wanted to go to 135 and 3rd Ct and was turned down by Zoning
They complain about car dealerships – Audi, Lexus and Warren Henry spent 250 MILLION to build dealerships in North Miami. I would do that every day of the week!
They turned down a WaWa? Do these idiots have any idea of the revenue they missed out on? Davie now has two WaWas and they’re making a freaking fortune. WTF is wrong with those people?
Deep Inside NMB and Stephanie .. I do not have any issues with the Warren Henry, Lexus, Audi, and/or Fiat Car Dealerships in North Miami … I wished the city will improve the roadway access with the roads east of railroad tracks surrounding the Lexus and Audi’s dealerships as they have poor access to the general public ..
WaWa posts almost $ 10 Billion Dollars in Sales for 900 Stores .. so the average WaWA location generates $ 1.77 Million Dollars in Sales .. Better than the DEAD GARDEN!
Maybe, just maybe there might be some changes in the near future. P&R Director, Derrick Corker was finally terminated. The city is being hush, hush about it to not bring attention to it. He has already been removed from the city’s website and his login has officially been deactivated.
Let’s not forget, Corker is the same director that had Andre Sorey in his department. Yes the Andre Sorey who is the brother of the Deputy City Manager. Who they claim never receives any special treatment. Which if you do a Public Records request they gave Andre Sorey a raised along with Mikey Sheehan a raised outside of the union contract. Another union member found out about it and reported it and then the city had to take the raises away. This took place about a year or two ago.
Yes, the Deputy City Manager serves at the will of the City Manager along with Directors, Asst Directors and several other positions. However council appoints the City Manager and can move the City Manager to terminate the Deputy City Manager and Directors for the “best” interest of the city, this has been done in the past.
This is going to be really interested, for a city with so many attorneys up top, from the newly appointed City Manager, as well as the City Attorney and City Clerk hopefully the city will move in a different direction. However, is it really possible if the council people are the same individuals who have allowed all this to happen under their noses? The newly elected Councilwoman Mary Estimé-Irvin is no different from the Mayor and Councilman Alix Desulme. They all run in the same circle and they have privately held meetings at her house constantly. Especially the Mayor and Councilwoman.
I guess WaWa wasn’t aligning the pockets of the council hence the denial. Who knows with this city?
“ Members of a public board are not prohibited under the Sunshine law from meeting together socially, provided that matters which may come before the board are not discussed at such gatherings.” – myfloridageneral.com
These consultant companies that were awarded this contracts for Red Garden wasn’t a coincidence. Let’s not act like “pay to play” hasn’t been in of North Miami’s mottos.
The success of this City depends entirely on the new manager, of whom I’ve placed a lot of hope, her decision about maintaining certain staff members, and then political will of this Council.
Some of the decisions seem obvious to me, but these have been glaringly obvious for a long time. Action speaks louder than words. I think it is very important for all of us residents to watch very carefully. Especially as we get into this budget season.
Also, beyond great reporting, Stephanie.