Reso_authorizing_settlement_3RESOLUTION NO. _________________
A Resolution authorizing and instructing the City Attorney to settle the case of City of South Miami vs Luis R. Figueredo, Case Number 10-46712 CA 10 and instructing the City Manager
to take the necessary steps to comply with the settlement terms.
WHEREAS, in 2010 Laurence Feingold was the City’s attorney and at that time the City filed suit against Mr. Luis R. Figueredo concerning the issuance of certain tax-exempt bonds in 2002
and 2006 (the “Bonds”) to finance the construction of the City’s parking garage (“Garage Project”); and
WHEREAS, the City claimed that Mr. Figueredo was the City Attorney at the time of the issuance of the 2002 and 2006 bonds and that he was responsible for the loss of the tax-exempt status
of the Bonds; and
WHEREAS, in the year 2002, Earl Gallop appears to have been the City Attorney; and
WHEREAS, in early 2002 the City entered into a lease agreement with Mark Richman Properties (“MRP”) which provided the City with air rights over the properties owned by MRP; and
WHEREAS, according to the transcript of a meeting of the City Commission in 2003, the original Garage Project contemplated in the MRP lease only committed the City to building a two-floor
parking garage and 19,000 square feet of retail space. It appears from these records that the bonds issued in 2002 would have been sufficient to build such a project; and
WHEREAS, according to the opinion of the City’s special IRS counsel, the original development agreement for the Garage Project did not immediately disqualify the 2002 South Miami Bond
as tax-exempt bonds; and
WHEREAS, after the initial 2002 Bond issuance, Mr. Richman and the City continued to revise the plans for the Garage Project; and
WHEREAS, at some point after the issuance of the 2002 Bond, MRP and the City agreed that MRP would develop the Garage Project and, in June of 2002, the City loaned $2,500,000 of the
2002 Bond proceeds to MRP (“Developer Loan”). According to the City’s IRS counsel, this Developer Loan was an impermissible private loan under Section 141 of the Internal Revenue Code
of 1986, as amended (“Code”), adversely affecting the tax-exempt status of the 2002 Bonds; and
WHEREAS, in late 2002, according to court documents, the City announced its intention not to proceed with the Garage Project; and
WHEREAS, Mr. Richman, according to transcripts of one of the City’s MRP Shade meetings, had purportedly advanced a substantial amount of money and he filed suit against the City for
damages for breach of contract; and