Miami to Get State Oversight Board but No Bailout

A state oversight board will help Miami escape from a sea of debt but won’t take over city government or provide a financial bailout, Gov. Lawton Chiles said Tuesday.

The board, to be appointed by the end of next week, “will help the city come up with a financial plan,” Chiles said in Tallahassee.

Awash in a corruption scandal and facing a cash shortfall of at least $68 million, Miami had asked for state help to straighten out the financial mess that Mayor Joe Carollo has attributed to mismanagement and corruption.

The state has helped advise county governments and some smaller cities, but this is the first time Florida has appointed an oversight board for a city government. Chiles said he has appointed his budget director and deputy director to talk with city officials about the shortfall in the $275-million budget.

The oversight board can make tough political decisions on union contracts, taxes and cuts in services. It can’t impose a tax increase but can recommend one.

Miami’s debt rating slid to junk-bond status last week and the city already is dipping into money set aside for long-term projects to pay for recurring expenses.

To try to get ahead, city inspectors worked Tuesday to collect delinquent garbage fees that could be costing the city $1 million a year. By winter, paychecks could run out for police, firefighters and trash collectors.

Miami’s financial straits came to light this fall after the city manager and finance manager resigned amid a broad investigation of corruption and cronyism. Both face federal charges.