A strategically located 28-acre parcel of land located on the shores of Biscayne Bay in south Florida has long served as a gateway and port to the City of Miami. In the mid-1970s, after a massive cleanup and conversion from commercial and industrial uses, the city took over the land for use as Bicentennial Park to commemorate the nation’s 200th birthday in 1976. During the 1980s and 1990s, Formula 1 racers and stock cars roared through the park; then in the 2000s, the land was used as a concert and event venue before closing down completely.
While the property has had a checkered history, two major developments are under construction on the site that will transform the park into a must-visit destination for tourists and residents alike. In just a few months, a major new art museum will open in a corner of this waterfront park, soon to be followed by construction of a state-of-the-art science museum. In recognition of the new museums anchoring this site, the park has been renamed Museum Park. When construction of both museums is completed, there will be about 12 acres of prime undeveloped open space remaining, and the city has embarked on a very ambitious plan to develop the remaining acreage and fund future operations and management of what they hope will become a world-class park.
The Florida State Legislature recently approved a bill to allow municipalities to accept unsolicited proposals from the private sector to participate in public/private infrastructure projects, which has enabled the city to proceed with the next phase of development for Museum Park.
A key backer of the legislation, Miami Commission Chairman Marc Sarnoff, sees major benefits for Museum Park in the form a public/private conservancy.
“This law gives us the ability to create Central Park in Miami,” Sarnoff told the Miami Herald following its passage. “It could be something special.”
Whether the city achieves its vision articulated by the Sarnoff proposal of creating a first-class park conservancy to support the new park remains to be seen. But a number of citizens and park advocates have raised a yellow-caution flag, based on the knowledge of the past history of land-development practices of waterfront properties. They also suspect that the new state law allowing “unsolicited proposals” from the private sector will leave the door open for too many unintended and unwanted outcomes, especially if the unsavory practices and previous track record of how some park development has occurred is any guide.
“Sordid” and “ugly” is how Gregory J. Bush, a founder of the Urban Environment League and a professor of modern history at the University of Miami, describes the approach to parks in the city of 409,000 residents. “This is a city without a memory,” Bush says, citing a list of waterfront parkland battles that were won and lost, including the construction of the American Airlines Center, home of the Miami Heat professional basketball team, on a pristine parcel of parkland just south of Museum Park.
In his book Inside City Parks, Peter Harnik, director of The Trust for Public Land’s Center for City Park Excellence, paints a picture of steady decline of parkland from Miami’s public park system and successive budget cuts to Miami’s park and recreation department. City leaders used parkland to generate revenue for the city, but in the process, they greatly diminished access to public parks and recreation resources.
“Whether for housing, a health clinic, a sports venue, an office building, or a restaurant and entertainment complex, numerous park properties have been leased to developers and removed from the rolls of free, publically available open space, particularly along Biscayne Bay,” Harnik writes.
So, public skepticism is high when it comes to the new law authorizing unsolicited proposals for such a conservancy. For one thing, as some civic watchdogs have pointed out, it would allow the city to go around its own regulations for leasing waterfront property because it would not require a public referendum or public participation. Also, it would enable the city to avoid competitive bidding and allow the city to loan money to a new private entity. Some believe a referendum should be held on any proposed deal. Commissioner Frank Carollo, who has questioned previous waterfront development projects, was quoted in the Miami Herald as saying, “We have a long history of not negotiating very good deals for our waterfront properties.”
So what has been the experience of other cities in establishing private conservancies to operate iconic city-center parks and raise significant funding from private and philanthropic donors? Clearly, public/private partnership conservancies require high-powered boards of directors to tap their philanthropic communities. Ernest Burkeen, Jr., director of Baltimore City Department of Parks and Recreation and a former director of Miami’s parks and recreation department, considers Sarnoff as a longtime champion of parks and open space in Miami.
“But the issue here is that Miami, unlike other large cities, doesn’t have a large number of foundations, so philanthropic giving has not been a part of its culture,” Burkeen says. “He [Sarnoff] is introducing a new concept that I think is going to take some time to develop.
“If you understand Miami, then you know it only has a thousand acres of [park] property,” Burkeen continues. “For the most part, they have been able to finance whatever they needed.”
Miami does have a culture of giving, Burkeen adds, but it has always been directed toward other areas than parks and open space. “Commissioner Sarnoff is going to have to create a culture of giving for this kind of thing,” Burkeen says.
Interviews with the creators of public/private partnerships for the funding, management and maintenance of public parks around the country yielded a number of valuable lessons that conservancies in other cities have learned that could benefit Miami in their consideration of whether and how to do this right for Museum Park.
When a conservancy succeeds or fails, it’s usually due to decisions made at the beginning of the process, says a key group of experts who were on the ground floor in developing conservancies in Pittsburgh, Pennsylvania; Louisville, Kentucky; and Orange County, California. Susan Rademacher of Pittsburgh Parks Conservancy, Dan Jones of 21st Century Parks in Louisville, and Michael Ellzey of Orange County Great Park Corporation in Irvine, California, all agree that, without question, the quality of the decisions made at the outset of the endeavor will determine the ultimate success of a public/private partnership.
A Unique Model for Every City
When Meg Cheever of the Pittsburgh Parks Conservancy made an agreement in 1996 to create a conservancy to restore four of the city’s regional parks, she turned to the president and executive director of the Louisville Olmsted Parks Conservancy in Kentucky, Susan Rademacher, to help get the Pittsburgh organization off the ground. In Rademacher, Cheever found someone who specializes in park planning and design and had mastered a series of successful organizational strategies in Louisville.
Rademacher credits New York City’s Central Park Conservancy as the inspiration for her work in both Louisville and Pittsburgh. She cites several decisions made in these cities early on that helped ensure success of their conservancy plans.
“One of the strategies that made the partnership work [in Louisville] was having the executive director of the conservancy also be the assistant director in the city-county Metro Parks department,” Rademacher says. “It was an evolving position and eventually I was able to establish my authority within the parks department for a planning and design position to carry out the work — in addition to being president of the Olmsted Parks Conservancy.”
Other conservancies, notably the Prospect Park Alliance in Brooklyn, New York, under the administration of Tupper Thomas, have employed this joint-role approach, Rademacher says. “But Tupper had a blended role, working with one park for which she had complete control and a blended staff, which is not the way it worked in Louisville.” In New York, the Prospect Park administrator was also accountable to the city Department of Parks and Recreation and had city park staff working in the park.
Developing Pittsburgh’s conservancy, however, proved to be no overlay of Louisville’s template. While Louisville’s 18 Olmsted parks and parkways evolved from a long-term master plan, development of Pittsburgh’s parks began at different times with different designers who had different functions in mind. But like Louisville, Pittsburgh is an industrial river town that had experienced a dramatic decline in the maintenance of its parks when Cheever launched the conservancy. The lessons Rademacher learned in both cities, however, have universal application for the creation of public/private partnerships.
“I see problems that often happen when one side or the other either keeps a project close to the chest or just develops to a certain point before enlisting their partner, or sometimes not enlisting their partner at all,” Rademacher says. “They end up carrying out something that might be at cross purposes to long-term planning goals.
“So that is really the most critical thing,” she continues. “It kind of goes against human nature because people do not necessarily know how to collaborate. They need to pay a lot of attention to their relationship and they must build trust and give each other credit.
“That’s an ideal I’m describing,” Rademacher admits. “But it’s an ideal that should always be kept in mind and always be worked toward.”
Rademacher sees a raft of other challenges facing creation of public-private partnerships, including municipal politics (“part of the pragmatic world”), the deals and trade-offs, and the tendency to treat parks like bargaining chips (“a hard thing for nonprofit partnerships to understand — just as it is for elected officials to adhere to longer-range plans”). Yet Rademacher envies Museum Park’s place on the timeline of the evolution of conservancies.
“It comes at a wonderful time because there is such a great track record of so many different organizations having formed along the same general model but tailored to specific politics and social issues and infrastructure needs,” Rademacher says. But, she notes, “There is no one model that is the ideal model.”
While strong board leadership is crucial to the success of a conservancy, the role of the government side is equally critical, Rademacher says. She cautions against conservancies taking on debt to either get going or to further grow themselves — either from loans or lines of credit. Financial liquidity, she believes, is crucial for the credibility of a nonprofit organization. Most donors, she says, do not want to give directly to cities, because they expect their money “to go down a black hole.”
“They have to have faith that over the long term their investment is going to be maintained,” Rademacher says. “So, really superb financial systems, transparency, having a healthy reserve, and establishing an endowment or core fund are critical.”
A 21st Century Approach
About the time Rademacher was transitioning from her role with Louisville’s Olmsted conservancy, another public/private partnership was forming to acquire land on the outskirts of the city for development into parks. 21st Century Parks began seven years ago with Dan Jones as its chairman and chief executive officer.
21st Century Parks builds on the work of former Lt. Governor Steve Henry and the Future Fund Inc., and a partnership with Louisville Metro government and Louisville Metro Parks. Today, the Parklands encompasses nearly 4,000 acres in a continuous corridor just beyond the Olmsted system around which Louisville has grown. Its current project is the Parklands of Floyds Fork in the eastern and southern sections of Louisville.
“What I am most proud of in our project is that we’re seven years into the hard work and we have a very strong partnership with the city,” Jones says. “They did not bring a lot of money into the capital side, but the city did bring land to the table. And they’ve also been helpful politically and in other ways.
“I think it is important for people to know it’s a true partnership,” Jones continues. “Both sides are contributing in significant ways, whatever and however that may be.”
In just over six years, 21st Century Parks raised more than $120 million — $38 million federal, $11.5 million state and city, and close to $70 million in private and philanthropic donations.
“And Louisville is not Miami in population or wealth,” Jones says. “So, it is possible.”
Jones says they were able to connect so well with potential donors because of their initial decisions. It all comes down to clarity, Jones advises.
“You must have a very clear vision — absolutely crystal-clear focus,” he says. “This is what we are doing — we are fixing up this park. Or this is a capital campaign for maintenance.
“We hired a great development director we jokingly call our drill sergeant,” Jones continues. “She ran the campaign. We had a group of co-chairs, and we had about 40 steering committee members whose job was to introduce us, so we could go out and present this project and make the ask. We call it peer-to-peer fundraising, and it’s very effective. But it needs strong leadership.”
Jones says that in the past, Louisville has attempted its own efforts at raising funds for park development and operation for other parks in the city, but it hasn’t had much success, something Jones attributes to some very specific reasons.
“People pay their taxes, so they don’t really want to write another check to what they perceive as another city agency,” he says. “To really make the project have legs, it has to be clear that it’s not just a project of the current administration, because new administrations come with a new set of priorities.
“So my advice would be, if you’re going to do this, do it like Central Park did it: an independent 501(c)(3) with its own board and its own leadership,” he says. “If you don’t have that independence, you’ll have a hard time raising money, and it will be unclear to people whether or not this is truly a long-term initiative or whether it’s some sort of project of the current administration.”
Jones says his biggest lesson came not from the government side of the partnership but more on the execution of the model.
“There needs to be a stage of work that is between the idea and the actual execution,” he explains. “It’s not just the strategic plan. It’s a high level of detail in the sense of saying: ‘Okay, what is our project and where are the major cost centers on the capital side and on the operating side? Then what is our sustainable model?’” he asks.
“The more clarity that can be done early on in those things, the more headaches you are going to save down the road,” Jones says. “The number-one question I get in public meetings and when we are making fundraising calls is, ‘How are you going to maintain all this? How are you going to pay for it?’
“Capital fundraising is actually easier than annual fundraising, even though the numbers are bigger, because it’s sexy, it’s exciting,” he says. “But you really have to think through the logistics. It’s the step in between.”
A Great Idea, But No Walk in the Park
In a significant contrast to how the managing entities developed in Pittsburgh and Louisville, the city of Irvine, California, followed a different path. In the early 2000s, the U.S. Department of the Navy put up for sale the 4,682-acre Marine Corps Air Station El Toro in Orange County, California. Lennar Corporation, a residential home builder, acquired the property in a joint partnership in an eBay auction for $650 million. As a part of the deal with the City of Irvine, Lennar was granted limited development rights in return for the land and capital necessary for the construction of Orange County Great Park. The agreement required Lennar to transfer more than 1,347 acres to public ownership and provide $200 million in development fees and another $201 million in assessment fees for development of joint backbone infrastructure in support of Orange County Great Park and surrounding development.
In 2003, Irvine’s city council established the Orange County Great Park Corporation, a public 501(c)(3) corporation, to oversee the design, construction, operation and maintenance of Orange County Great Park. This month, the Orange County Great Park Corporation expects to celebrate the completion of its first phase of development, a 230-acre portion of the overall park tract.
“So, we are taking a pretty good first stab at the first phase,” says Orange County Great Park Corporation CEO Michael Ellzey. “But it’s taken many years, and it’s taken a considerable amount of funding.”
Ellzey explains that Great Park was founded on a unique relationship among the developer, the city and the Great Park Corporation.
“It’s essentially built around a relationship with a private developer (now known as FivePoint Communities) that intends to develop residential, educational and institutional uses around the park, using the park itself as an economic driver for the value of the homes and businesses,” he says. “So, it’s very much a partnership, where the key to our success will be a win/win for the other partner.
“Beginning in 2008, our private partner — along with a lot of other people — ran into a buzz saw with the national real estate market as our partner began planning to build its first vertical structures,” Ellzey explains. “The partnership model was based primarily on the funding mechanism for the park that was not only based on the developer fees but also redevelopment financing.”
The mechanism in California that by law allowed a real estate organization in specific state redevelopment zones to bond against the difference between the undeveloped and developed values of land fell apart with the administration of Governor Jerry Brown in 2012.
“He effectively eliminated redevelopment in California,” Ellzey says. “So we currently have in litigation and at risk $1.4 billion in tax increment financing that we would be using to build the park.” Instead, Great Park has had to tap into a $200 million developer fee.
The Great Park has a third component that has contributed to a perfect storm: the struggling Foundation for the Great Park. Clarity of purpose and mission goes to the heart of this matter, Ellzey explains.
“We have an unfortunate hybrid organizational construct here,” he says. “They are in existence for raising funds for the support of a park on one extreme. On another extreme, you have an entity that owns Great Park — the City of Irvine. And in the middle is a hybrid, 501(c)(3) public-benefit corporation — the Orange County Great Park Corporation — which also has the ability with its 501(c)(3) status to raise money.
“That’s the organization I head up — a very strong $20-million-a-year organization with 46 employees,” Ellzey continues. “The ongoing concern has been in the business of programming and building of the park — but we also have the ability to raise funds.”
Ellzey says they are in the process of steering the Foundation for the Great Park toward the role of funding only programming for the park. That’s a move that will deliver more clarity to everyone’s efforts, he says. The Orange County Great Park Corporation would then be more easily able to pursue what it considers its main mission: building and maintaining the park. Ellzey considers achieving this definition of roles as critical to the overall goals of developing and operating the park.
“I believe we are getting closer and closer to making that happen,” he says.
In the meantime, to make up for the loss in revenue from home sales and the loss of redevelopment funds, Ellzey wants to work with private partners to help fund key components of phase two of Great Park’s development.
“I’m in discussion with probably half a dozen private partners…to build some facility and operate it under a long-term lease,” he says. He cites a professional hockey team, the Anaheim Ducks, as a potential partner for building an ice rink. “We have similar things going on with baseball, soccer and equestrian interests,” he says.
So, what are their lessons learned?
“I think the main lesson is clarity,” Ellzey says. “What we have learned is that it’s taken some period of time for us to clear through the downturn in the real estate market and to react to the loss of redevelopment and to come up with a series of creative partnerships and mechanisms for getting back on board with measurable success. I think we’ve done that.”
A Partly Sunny Forecast for Miami
In Miami, Brenda McClymonds heads up the south Florida field office for the Trust for Public Land. She’s heard all the arguments on the upside and the downside to creating a conservancy to fund and run Museum Park. She ultimately sees the situation from a “glass half full” perspective.
“I see it as a window of opportunity to emphasize the importance of parks in Miami,” McClymonds says. “We really have an opportunity to focus on what a park can be.”
In the neighboring jurisdiction of Miami-Dade County, its parks director sees room for optimism for a conservancy for Museum Park. He’s particularly bullish on the philanthropic prospects for a conservancy-style organization for the park.
“When you have something as iconic as what is being developed in Museum Park, that changes the equation in a big way,” says Jack Kardys, director of the Miami-Dade Parks, Recreation and Open Spaces Department. “The whole area is poised in a way that is different from some of the other fundraising that has been done by the city parks department. This is big stuff.”
Kardys considers development of Museum Park important because of its interlocking role in the overall development of open space in the city-county area. In particular, the future of Museum Park is tied into the execution of the city’s Miami 21 master plan, in which the county participates.
“When you look on a map and you see the greenway system as it is set up, it’s almost like spokes in a wheel coming out of the downtown — Museum Park, Bayfront Park, the downtown corridor, and then it moves up the Miami River and north and south,” Kardys says. “So, we’ll be very, very happy to see that conservancy concept take off and for the fundraising to begin.”