Sunshine State: Darkness at Noon

[BiscayneSunrise]

Re: Sunshine State: Darkness at Noon

http://www.bloomberg.com/apps/news?p...d=a7s0rpuaOw50

Oct. 16 (Bloomberg) -- Robert Cooper says he has found a way to make money in South Florida’s real estate bust.

Cooper, an attorney in Aventura, Florida, sues for refunds on deposits in the nation’s largest condominium market. In the last two years, he filed lawsuits for about 1,500 buyers against companies and individuals including the Related Group of Florida, Dezer Development LLC, Corus Bankshares Inc., Donald Trump.

More suits seeking refunds under a federal law regulating condo sales have been filed in South Florida than in the rest of the country combined, according to a search of federal court records. Fueling the litigation is a price crash that makes buyers unwilling to pour more money into bad investments -- even if they can get financing. Condos on which they made deposits of up to $1,000 a square foot in 2006 are now selling for $125 to $350 a foot, said Jack McCabe, a real estate consultant in Deerfield Beach, Florida.

“If you’re thinking you can come here and buy and sell condos for a profit in less than five years, you’re sadly mistaken,” said McCabe, whose clients have included Credit Suisse Group AG and Pulte Homes Inc., the largest U.S. homebuilder. “You need a seven- to 10-year range.”

Prices could fall to $100 a foot, less than half the cost of construction, and a value not seen in 20 years, he said.

Vacant Condos

In Dade, Broward and Palm Beach counties, there are more than 43,000 condos and townhouses on the market, almost 1-1/2 times the number of single-family homes, according to Condo Vultures LLC, a Bal Harbour real estate brokerage. In downtown Miami, more than 8,000 condos stand vacant and unsold, relics of a building binge that added 23,000 condos from 2003 to 2008, said Peter Zalewski, principal of Condo Vultures.

Over the past 12 months, condo prices fell 15 percent in the West Palm Beach-Boca Raton area to a median of $112,200, 36 percent in Fort Lauderdale to $85,100 and 31 percent in Miami to $144,700, according to Florida Association of Realtors data.

Those prices are likely to fall more when the $1 billion portfolio of South Florida condos financed by Corus Bankshares, the Chicago lender seized by federal regulators, goes on the market, Zalewski said.

Investors led by Starwood Capital Group LLC won a bid for Corus’s loans. Two-thirds of the 2,537 condo units Corus financed in downtown Miami are unsold and unoccupied, Zalewski said.

Corus Deal

Rather than drive prices down more, the Corus sale could help stabilize the condo market because Starwood, in its partnership with the FDIC, can hold onto the properties, said Craig Werley, principal of Focus Real Estate Advisors in Coral Gables.

“Why on earth would they create more cutthroat competition when they’re in such a good position with the federal government?” said Werley, who co-wrote a study on the condo glut for the Miami Downtown Development Authority.

For Cooper, fighting over the spoils is a full-time job. Cooper said he has reached out-of-court settlements in disputes over 500 deposits, recovering about half of his clients’ money. He won’t say how much the refunds total or how much he has earned in contingency fees, which are usually about one-third of the recovery amount.

“There’s no recession in the real estate litigation community,” said Cooper, 46.

To contact the reporter on this story: John Gittelsohn in New York at johngitt@bloomberg.net.

Last Updated: October 16, 2009 10:39 EDT

[BiscayneSunrise]

Re: Sunshine State: Darkness at Noon

Another little jewel making it tougher for businesses here in Florida:


TALLAHASSEE, Fla. (AP) -- Unemployment compensation taxes paid by Florida businesses will skyrocket next year due to the state's high jobless rate - 11 percent in September.

The minimum tax will jump from $8.40 per employee to $100.30 - an almost 12-fold increase - in 2010, state Department of Revenue officials said Wednesday.

The maximum will go up from $378 per employee to $459.
Another factor contributing to the increases is that taxable wages are going up from $7,000 to $8,500 per employee.
The increases are needed to replenish the state's Unemployment Compensation Trust Fund. It dropped from more than $1.3 billion last year to zero in August. Florida then began borrowing $300 million a month from the federal government to pay benefits.


© 2009 The Associated Press.

[don]

Re: Sunshine State: Darkness at Noon

Paradise lost: Florida resort files for bankruptcy

Carrie Coolidge
Nov 18th 2009 at 6:20PM

Like many other luxury resorts around the world, Amelia Island Plantation is feeling the effects of the recession. Last week, the 1,350-acre luxury enclave overlooking the Atlantic Ocean in northeast Florida filed a voluntary petition for Chapter 11 bankruptcy protection.

The resort is very dependent on its group business, which has dropped precipitously over the past year, according to Richard Goldman, its chief marketing officer. "More than half of our business is from corporate groups that hold conferences here," says Goldman. "The AIG effect has basically scared off folks -- even businesses that could afford to have meetings -- who are afraid to hold conferences at resorts." The "AIG effect" refers to businesses that have toned down lavish corporate events after the insurance giant was widely criticized for holding a conference at a luxury resort days after it received a cash infusion from Congress in 2008.

The bankruptcy was filed with the U.S. Bankruptcy Court, Middle District of Florida, Jacksonville Division. The company will restructure its debt and liabilities under the protection of the courts, while maintaining ongoing operations. Chapter 11 bankruptcies can last from a period of months to several years. "Our plans are to hold all the usual festivities and celebrations," says Goldman, who added that business will continue as before.

On a brighter note, the company has signed an agreement with a new investor group, Red Maple Investors, to help ensure the future of the renowned resort. The investor group, which consists of 22 well-heeled and concerned Amelia Island Plantation club members and property owners, organized after hearing of the financial condition of the club. Red Maple Investors have offered $5 million in "debtor in possession" interim financing and raised another $15 million with a plan to buy long-term equity in the company after it emerges from bankruptcy.

"We are pleased that Red Maple Investors truly believe in our vision for the future," says Jack Helan, president of Amelia Island Plantation.

http://www.dailyfinance.com/2009/11/18/paradise-lost-florida-resort-files-for-bankruptcy/?icid=main|htmlws-main-n|dl4|link6|http%3A%2F%2Fwww.dailyfinance.com%2F20 09%2F11%2F18%2Fparadise-lost-florida-resort-files-for-bankruptcy%2F

[BiscayneSunrise]

Re: Sunshine State: Darkness at Noon

http://www.orlandosentinel.com/featu...,1644290.story

TALLAHASSEE - For decades, Floridians have essentially bought government on the cheap, satisfying a swelling appetite for expanded services with taxes paid in large measure by visitors and newcomers.

But the idea that the Sunshine State can keep buying happiness on the backs of an exploding population has all but vanished in Tallahassee.

Years of talking about building a high-tech leg to Florida's economy has sprouted shiny new buildings at the Burnham Institute in Orlando and Scripps research park in Palm Beach County — but so far, the economic spinoff from the state's investments hasn't provided enough cushion to soften the falloff in growth.

At the same time, the side effects of growth have increased demand for classroom space, prison beds, court services, jobless benefits, health care and other services for the poor — which is why state legislators are staring at a $2.6 billion budget shortfall when the 2010-11 fiscal year starts in July — the fourth consecutive year of budget holes created by a faltering economy.

And for the foreseeable future, economists predict tax receipts won't catch up with Florida's burgeoning demand for education, entitlement programs and public-safety services.

"There are some difficult decisions that need to be made," said John Hall, director of the left-leaning Florida Center for Fiscal and Economic Policy.

Florida's Republican leadership in Tallahassee has settled on three options: change the tax structure and tap new revenue sources; make more service cuts and program changes; and take a longer-term approach of beefing up economic-development measures — including higher education — while scaling back regulations on businesses.

All of the options have their critics, but no one has a better solution.

"Florida ultimately will begin to grow again. The question is, how do we grow and who controls growth?" said state Sen. Don Gaetz, R-Niceville, who chairs the Senate Select Committee on the Economy, which has been studying policies for a year.

"The days are long gone when our economic policy amounts to standing at the welcome center with a free glass of orange juice and a real-estate map."

Breaking the cycle

The problem is simple: Florida's economy doesn't generate enough money to meet its needs.

Government spending was set on an upward trajectory by a series of policy choices made during the past two decades. Among them: free-tuition "Bright Futures" scholarships for top high-school graduates; smaller K-12 class sizes; beefed-up prison sentences for violent criminals; and expanded social-service programs for the poor and elderly.

Most were politically popular moves at the time. But now that the boom days of population growth have vanished, the state's taxing power can't keep up.

"No one really has come up with a model for how Florida will stay a prosperous state with downward population growth," said Dominic Calabro, chairman and CEO of Florida TaxWatch, a business-backed think tank in Tallahassee. "Structurally, this is really a resounding question for us to answer."

The GOP-led Legislature and Governor's Office say the way to deal with the problem long term is to capitalize on Florida's destination status for retirees, while making it more attractive for companies and white-collar wage-earners to relocate here. Some cite California as a model — to a point.

"California was very successful at creating great quality of life, a pretty good infrastructure system and a good education system," said state Rep. Will Weatherford, a Wesley Chapel Republican slated to become House speaker in 2012. "What they did not do was keep their taxation system low, and their government spending got out of control. We want to do what California did, but keep your taxes low."

Taxes and revenue

Gov. Charlie Crist and lawmakers raised taxes and fees $2.2 billion last spring to balance Florida's $66.5 billion budget. Could we see a repeat next year, with another $2.6 billion shortfall? Not if they can help it.

2010 is an election year, and it's hard to imagine the Florida Legislature would stomach another round of tax or fee hikes. Long-debated topics such as taxing services and repealing sales-tax breaks for businesses will be nonstarters. Instead, lawmakers are more likely to focus on longer-term revenue boosts.

Offshore drilling: This is a pet project of House Speaker-designate Dean Cannon, R-Winter Park, and Sen. Mike Haridopolos, R-Merritt Island. But a projected $2.2 billion a year in royalty revenue — a figure sharply challenged by opponents — wouldn't materialize for years, if ever.

Revising the corporate-profits tax: Groups including Florida TaxWatch are pushing for Florida to join about two dozen states and change the way it taxes corporate income by adopting a formula based on sales rather than profits. The idea is to encourage companies to move to Florida. But it could cost money in the short term. California just made the change — and faces a projected 15 percent drop in corporate tax receipts during the next two years.

Internet sales taxes: Two dozen other states have vowed to petition Congress to help capture sales taxes on goods bought on the Internet, and Florida is being pushed to join them.

Bottom line: New revenue sources are likely to be in short supply.

Government services and programs

About$900 million of next year's budget gap is caused by an end to federal economic-stimulus dollars, beginning in December 2010 when Medicaid funding starts running out. There's hope that Congress could extend its supplemental funding, which could deliver another $1 billion to Florida. Indeed, demand for safety-net social services continues to soar.

Medicaid: The state's 11 percent unemployment rate is forcing more people into Medicaid and food-stamp rolls. Health-care reform could add hundreds of thousands more to the government-run health-care program.

Senior services: More than 30,000 seniors and 18,000 disabled residents are on waiting lists for home-based services designed to help them live independently.

Substance abuse: More than 17,000 people are on a wait list for substance-abuse services.

Bottom line: Absent another federal bailout — which is unlikely — it's easier in an election year to cut the budget than raise taxes.

Economic development and regulation

For decades, Florida's job-creation strategy focused on "clean" tourism-related businesses. But for the past decade, lawmakers have thrown hundreds of millions of dollars at high-tech and medical technology centers, such as Scripps and Burnham.

Now, GOP lawmakers want to revisit the 13 programs the state uses to dole out cash to new companies, while scaling back regulations they see as impeding the location and expansion of businesses. "We're still the No. 1 destination for people in their older years and their younger years," said Rep. Chris Dorworth, R-Lake Mary, who is vying for the House speakership in 2014. "What we're struggling to do is make sure we get them for the earning years."

Colleges and universities: Incoming House and Senate leaders see beefing up higher education as one key to economic development. They want to continue development of research "clusters" such as Scripps and Burnham and — like other states, including California and North Carolina — use the state's university system as a tool to recruit businesses. But this is likely to mean higher tuition charges — and cuts elsewhere in the budget to fund higher education.

Bottom line: Building a new Silicon Valley in the Sunshine State won't happen overnight — and might not for a decade or more.



The budget outlook



During the next three years, the state's total budget shortfall could reach $13.3 billion, economists predict. Here are some reasons:

■ Required education spending will grow 10 percent next year, while tax dollars for schools coming from local property taxes are projected to fall 1.9 percent during the next three years thanks to declining home values. That leaves the state with a $1.4 billion gap to keep funding per-student spending levels, Bright Futures scholarships, constitutionally mandated class-size requirements and burgeoning university and community-college enrollment.

■ Growth in the Medicaid state-federal health-insurance program for the poor and elderly will require $1.2 billion more next year to keep its wide array of programs for the 2.7 million (and growing) Floridians with incomes low enough to qualify. Costs for welfare benefits and KidCare health insurance are also expected to climb. All told, $2 billion in new money will be needed.

■ Prison-bed construction during the next three years will require $652 million in new money to house Florida's 100,000-and-growing incarcerated population, plus more money to operate them.

Aaron Deslatte can be reached at 850-222-5564 or adeslatte@orlandosentinel.com.

[BiscayneSunrise]

Re: Sunshine State: Darkness at Noon

I did not know that Dubai World had an interest in the Fontainebleau Miami beach

http://www.bloomberg.com/apps/news?p...fcACCJfA&pos=6

Fontainebleau Miami Said to Offer $100 Million Equity Infusion

By Jonathan Keehner and Beth Jinks


March 17 (Bloomberg) -- Fontainebleau Miami Beach owners Dubai World and Jeffrey Soffer, chief executive officer of Turnberry Ltd., offered the resort’s lenders a debt- restructuring plan that includes $100 million of new equity, according to three people with knowledge of the talks.

The Fontainebleau borrowed more than $620 million to help fund renovations and it hasn’t made loan payments since September, said the people, who asked not to be named because the talks are private. Dubai World, which owns half of the resort, is leading negotiations with lenders, the people said.

Lenders, led by Bank of America Corp., haven’t given final approval to the plan, which includes extending senior debt maturities by four years to 2016 and increasing loan fees and interest rates, according to one of the people. Debt holders, including hedge funds Highland Capital Management LP and Five Mile Capital Partners, had rejected a previous restructuring proposal.

A spokesman for Istithmar World, the private-equity arm of Dubai World, said the company believes the resort is a valuable asset with a solid future. Representatives of Fontainebleau Miami Beach, Bank of America and Highland Capital Management declined to comment. Messages left at Five Mile Capital weren’t immediately returned.

To contact the reporters on this story: Jonathan Keehner in New York at jkeehner@bloomberg.netBeth Jinks in New York at bjinks1@bloomberg.net.

Last Updated: March 17, 2010 10:21 EDT

[thriftyandboringinohio]

Re: Sunshine State: Darkness at Noon

"California was very successful at creating great quality of life, a pretty good infrastructure system and a good education system," said state Rep. Will Weatherford, a Wesley Chapel Republican slated to become House speaker in 2012. "What they did not do was keep their taxation system low, and their government spending got out of control. We want to do what California did, but keep your taxes low."

LOL!:p:p;):p

Right after Republican Weatherford gets that done, he'll finish his new diet book "loose weight by eating doughnuts and chocolate cake"

[MulaMan]

Re: Sunshine State: Darkness at Noon

Jeb Bush showed his Bush family skills of destroying America first hand in South Florida, so now that he has some destruction under his belt, he is ready to make a run for president.

Jeb Bush and his cuban mafia friends sold out South Florida to the highest bidder, which was wall-street banks, large developers, ect.

[BiscayneSunrise]

Re: Sunshine State: Darkness at Noon

http://articles.sun-sentinel.com/201...l-overcrowding



Broward closing jail space

Will suspects be released?
Sheriff "forced'' to reduce inmate count to save money
June 01, 2010|By Brittany Wallman, Sun Sentinel




Under intense financial pressure, the Broward County (Metro Fort Lauderdale) sheriff is making a move that could prove risky: shuttering another jail wing.

The planned closing in July of a 544-bed tower at the Paul Rein Detention Facility in Pompano Beach may seem counterintuitive during a recession and in a county that's under federal watch for jail overcrowding.

In fact, it will be the fourth decrease in jail beds in Broward County over four consecutive years. All told, the county jails will have lost 1,256 beds for inmates, not because of declining crime, but because of dropping funds.

Inmate population in Broward County is at a 10-year low.


Largely paid for with property taxes, county jails are a target for cuts as tax income plummets across the state, and across the country. Counties are desperately looking for cheaper alternatives than jail for suspects and criminals.

Broward Sheriff Al Lamberti said he doesn't want to empty jails, and he's "concerned" about the number of suspects and convicts set free in monitoring programs — a population he put at 19,000 in Broward.

"I'm being forced to. I don't want to," he said Wednesday. "If it was up to me, we'd have no pretrial release, and everyone would be incarcerated."

But in the political equation of budget slashing, road patrol deputies are considered sacred, compared with jail guards. And something's got to go.

In Broward's neighboring counties, spending on corrections and rehabilitation of criminals is in jeopardy as well.

Miami-Dade's corrections spending dropped 5.5 percent this year over last. The county considered closing a boot camp just last month to save money, but opted not to.

Palm Beach County's sheriff has been ordered to cut 5 percent — or $25 million — from his new budget and is considering killing a popular drug treatment program and shutting down a military-style school for troubled teens. As in Broward, the sheriff in Palm Beach County hopes to protect patrol deputies' jobs.

The budget dicing in Broward County is made all the more delicate by a court order that demands jails not exceed their designated capacity, a dictate that stems from a 1976 lawsuit about overcrowding. Federal monitors already have alerted the Broward Sheriff's Office that they want answers about the proposed closure.

[jk]

Re: Sunshine State: Darkness at Noon

http://articles.sun-sentinel.com/201...l-overcrowding



Broward closing jail space

Will suspects be released?
Sheriff "forced'' to reduce inmate count to save money
June 01, 2010|By Brittany Wallman, Sun Sentinel




Under intense financial pressure, the Broward County (Metro Fort Lauderdale) sheriff is making a move that could prove risky: shuttering another jail wing.

The planned closing in July of a 544-bed tower at the Paul Rein Detention Facility in Pompano Beach may seem counterintuitive during a recession and in a county that's under federal watch for jail overcrowding.

In fact, it will be the fourth decrease in jail beds in Broward County over four consecutive years. All told, the county jails will have lost 1,256 beds for inmates, not because of declining crime, but because of dropping funds.

Inmate population in Broward County is at a 10-year low.


Largely paid for with property taxes, county jails are a target for cuts as tax income plummets across the state, and across the country. Counties are desperately looking for cheaper alternatives than jail for suspects and criminals.

Broward Sheriff Al Lamberti said he doesn't want to empty jails, and he's "concerned" about the number of suspects and convicts set free in monitoring programs — a population he put at 19,000 in Broward.

"I'm being forced to. I don't want to," he said Wednesday. "If it was up to me, we'd have no pretrial release, and everyone would be incarcerated."

But in the political equation of budget slashing, road patrol deputies are considered sacred, compared with jail guards. And something's got to go.

In Broward's neighboring counties, spending on corrections and rehabilitation of criminals is in jeopardy as well.

Miami-Dade's corrections spending dropped 5.5 percent this year over last. The county considered closing a boot camp just last month to save money, but opted not to.

Palm Beach County's sheriff has been ordered to cut 5 percent — or $25 million — from his new budget and is considering killing a popular drug treatment program and shutting down a military-style school for troubled teens. As in Broward, the sheriff in Palm Beach County hopes to protect patrol deputies' jobs.

The budget dicing in Broward County is made all the more delicate by a court order that demands jails not exceed their designated capacity, a dictate that stems from a 1976 lawsuit about overcrowding. Federal monitors already have alerted the Broward Sheriff's Office that they want answers about the proposed closure.

let's see.... closing expensive jail space, lots of empty condos, electronic monitoring bracelets for non-violent offenders... hmmm...