Six-Digit Discount

Wilton Manors is strapped for cash, but the city gives a developer a $160,000 discount on fees.

On June 10, 2004, at the groundbreaking ceremony for the "planned community" called Wilton Station, city officials from Wilton Manors and real estate developers from the company Ellis Diversified Inc. (EDI) acted like revelers at a wedding, toasting to a prosperous future. The $100 million condo development — a five-building complex of 272 units — was the first major luxury project in the small city, and it would trigger more such developments.

Then-Mayor (now city commissioner) Scott Newton took to the lectern and praised the developers. "I want to thank [them] for helping our city to grow and become a better place to live," he said in a video from the event. "Everything we asked them to do, they went beyond that. If we asked for an inch, they went three inches." To crown the day, the developers and their wives, leaning on shovels in spotless suits and cocktail dresses, posed for a photo in a mud field looking not unlike 19th-century prospectors.

What a difference five years makes. Wilton Station would be completed just as the housing market was peaking. Boom turned to bust. Condo prices dropped 20 to 30 percent in Wilton Station, and dozens of residents were foreclosed. By 2009, the City of Wilton Manors would be scrounging for cash, and a political battle would break out over $375,000 in fees. Developers would accuse city officials of a backroom deal and a broken promise, the mayor would target a rival city commissioner with allegations of corruption, and taxpayers would be left to suffer the mess.

In 2004, around the same time that Wilton Station's units went up for presale and immediately sold out, city engineers determined that a population boom would strain the city's aging sewage system. They would need to replace an antiquated lift station that pumps liquid waste into the main water-treatment facility. To pay for the $1.5 million upgrade, Wilton Manors commissioners in September 2004 considered an ordinance to impose impact fees of $1,600 on every new condo unit in the city. The developers of Wilton Station protested that they had already paid for and received their building permits and shouldn't be slapped with new fees so late in the game. Citing previous court rulings, city officials argued that the law would be on their side should a legal battle ensue. The ordinance passed unanimously over the developers' objections.

As with any condo project, inspectors needed to ensure that the buildings were up to code, then issue a certificate of occupancy (commonly called a "CO") before any residents would be allowed to move in. City Manager Joseph Gallegos explains, "Wilton Station passed inspections, but it needed to pay sewer-impact fees to get its COs." Despite the earlier insistence that those fees shouldn't apply to Wilton Station, EDI in late 2006 obligingly coughed up $73,000 — the impact fee for the first of its five buildings. In return, they received the CO for that building.

Soon afterward, the additional four buildings went up, Wilton Station received COs, and residents moved in. Today, Wilton Station is a cluster of green, orange, and beige monolithic buildings and cobblestone, palm-tree-lined avenues walled off from the world like a religious cloister. Each unit comes with a whirlpool bath. There's a high-tech gym and a cinema. Two waterfalls pour into the swimming pool, where bacchanals regularly occur.

There was just one outstanding matter: Wilton Station had never paid the impact fees — totaling $375,000 — for those last four buildings. In cash-rich 2004, the sum may have seemed like chump change, but in the current economic climate, Wilton Manors is planning to cut services and some departments have cut back to a four-day workweek. What's more, the city is short $1 million for the new sewage lift station. To complete it, the newly elected mayor of Wilton Manors, Gary Resnick, sought grants in Tallahassee. "But the state is broke," he says, "and we were turned down." With money so tight, the question burned: How had Wilton Station's developers received the COs if they had never paid the required six-figure fees?

City Manager Gallegos tells New Times that he had billed Wilton Station since 2007. "We sent letters and made phone calls to the developers notifying them of the missed payments." He says that EDI essentially ignored the bills until the end of 2008, when the company requested building permits for a row of commercial spaces in Wilton Station. The developers were refused because of the unpaid fees, so early this year, they asked that the issue be put on the agenda at a City Commission meeting in hopes of resolving the matter.

When Resnick got wind of the old debts, the issue ballooned from a mere bookkeeping matter into a public political feud. Resnick published a notice in the Town Crier, the city's official newsletter. Wilton Station "never paid all the impact fees it owes our City," Resnick wrote. "Based on the number of units, Wilton Station owed the City approximately $450,000. It paid $73,000 in 2006 but for some reason we are still looking into, never paid the balance prior to obtaining COs. In any event, Wilton Station has now requested the City to waive most of the $375,000 impact fees." He warned his constituents that all of the city's residents may have to pitch in to cover the tab for the sewage lift station.

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