Auditor Examines Millions Miami Int'l Airport Pays Miami-Dade County

Feb. 23--A Miami-Dade County Commission auditor is scrutinizing tens of millions of dollars the county bills Miami International Airport each year for services such as marketing, office supplies and attorney fees.

MIA is slated to pay the county $31.4 million this year, not including fees for police, fire-rescue or utilities.

By comparison, Fort Lauderdale-Hollywood International Airport reimbursed Broward County $4.3 million for similar services in 2005. Orlando International Airport paid local governments $1.7 million.

Per passenger, MIA's reimbursements to Miami-Dade are higher than those at any other large airport except San Francisco, according to an analysis of Federal Aviation Administration data.

MIA also boasts the largest payroll expense of any large American airport, per passenger.

The FAA monitors payments airports make to local governments to ensure airports aren't used as piggy banks, diverting funds earmarked for aviation.

The county's audit is driven by concerns over MIA's high costs, which have made it difficult to attract new flights while undergoing a massive expansion.

County auditors want to know why. Is MIA paying the county for services it doesn't need, or for work it could do more efficiently in-house? Or, are MIA employees not working efficiently?

"We're looking at what they are getting, and how much other airports pay," said Commission auditor Charles Anderson, who began the audit in January.

Three years ago, the U.S. Department of Transportation's Office of Inspector General audited five airports nationwide, including Miami, to see if counties and cities were billing their airports properly. The report found $40.9 million in questionable payments over five years.

MIA's share: $38.7 million.

Among payments questioned: Billing the airport for sponsoring an MIA-themed float in the Orange Bowl parade and leasing land to two county departments at far below market value.

After Miami-Dade County appealed, the inspector general said the county only had to repay the aviation department $11 million.

Those costs add up. For every $15 million MIA spends, it charges airlines about $1 per passenger in fees. Its high operating costs are why the fees MIA charges airlines to fly there are more than four times Fort Lauderdale's.

Miami-Dade County's Office of Strategic Business Management, which prepares the county budget, said the payments are scrutinized annually. The county believes the success of the appeal in reducing the fees by $11 million validates the bills the aviation department pays.

"What they didn't approve, we discontinued," said Jennifer Glazer-Moon, director of the Office of Strategic Business Management. "We will be paying back the $11 million."

Other departments also reimburse the county.

The issue is a difficult one for airport officials, who are trying to cut costs. Criticizing the payments means criticizing the county, and bucking a prevailing culture that encourages "teamwork."

Aviation director Jose Abreu, who has been on the job for six months, has hired a consultant, Maximus, to review ways MIA could become more efficient.

Abreu said he believes county expenses are legitimate. However, he said the aviation department "will look at everything." He said 100 open positions could be left vacant, and additional jobs could be cut through attrition.

This year, MDAD is scheduled to pay the county attorney's office $670,000 in expenses -- even though MDAD already pays eight attorneys and six paralegals $4.53 million. Abreu said a mountain of legal work stemming from the North Terminal construction project is likely the cause.

The county manager's office billed the aviation department $343,000 to pay for "promotional items." MDAD has its own public affairs staff -- which promotes the airport -- with a budget of $1.9 million.

MDAD pays the county through direct payments billed from departments and indirect payments that are a percentage of the department's total payroll. Two years ago, a consultant reduced the amount the department was paying in indirect costs. Today, that's about $9.9 million -- 8 percent of total payroll.

But as those indirect costs have been cut, direct payments have risen sharply.

During the fiscal year 2002-03, MDAD paid the county $20.9 million. Two years later that rose to $30.6 million.

It's expected to remain the same in 2005-06, not including expenses for fire services, which are run by the county.

Jim O'Reilly, president of the American Federation of State and County Municipal Employees Local 1542, which represents many MIA employees, is upset MDAD is scrutinizing its employees. The problem, he said, is that the airport pays too much for consultants -- on top of the money spent reimbursing the county.

MDAD spent $75.1 million on consultants in 2004, including the $31.4 million it reimbursed the county.

"There is an excessive amount of money being spent on outside contractors ripping the county off," O'Reilly said. "They should have county employees doing the work."

He also blamed MIA's massive construction program for driving up costs.

"What's costing us a fortune is not that we aren't doing enough business. It's the out of control growth at the airport -- and now the debt is coming due. It's a shame that every time we get in a financial crisis, we take it out on the employees."