Loyal readers of these often-irreverent screeds know that if you analyze them with the right kind of eyes, hold your nose and suspend disbelief for a brief moment – you can often find a kernel of truth – an almost precognitive foresight that gives a glimpse of our future here on Florida’s Fun Coast.
I don’t know where it comes from. . . Some divine gift of political clairvoyance, I suppose.
Or maybe, like you, I’ve just seen it all before?
Way back in those heady days of 2017, I wrote a prescient little ditty about a mysterious “Russian” developer – d/b/a Protogroup, Inc. – a company owned by Alexey Lysich, currently of Palm Coast by way of St. Petersburg (and I don’t mean ‘heaven’s waiting room’ over in Hillsborough County), who everyone who is anyone in the Halifax area pinned their hopes on to build the next big thing on our beleaguered beachside.
Last June I said, “Anyone who has driven down A-1-A recently has seen the gash in the sand that we are told will be the foundation of the towering twin-spires of the Daytona Beach Convention Hotel & Condominiums – a $185 million beachfront monstrosity that is being constructed by Russian developer Alexey Lysich’s Protogroup.
The ground has been cleared and the pilings driven into place – the foundation of this spectacular new addition is ready to go – and everything is in place.
Except the financing.”
At the time, according to a very informative article in The Daytona Beach News-Journal:
“In a 2012 foreclosure sale, Florida-company Protogroup, which lists Lysich as vice president and his brother as president, bought 4.5 acres, just south of Seabreeze Boulevard, for $6.3 million. Protogroup’s vision for the property is a massive 1.1 million-square-foot complex with two 300-foot-plus oceanfront towers connected by a catwalk suspended over the Oakridge Boulevard beach approach to maintain public access to the sand.”
The original plan called for the convention center and condominiums to be open for business by the fall of 2015, but, like most ambitious projects here on the Fun Coast – from Rock-n-Roll hotels to homeless shelters – months dragged into years and, well, here we are. . .
It was – as our ‘Rich & Powerful’ like to say – the latest, greatest “Game Changer” – the panacea project that would save us rubes from ourselves and cure every ill we face from crippling economic blight to head lice.
Of course, former Daytona Beach Mayor Glenn Ritchey got in on the act and took personal credit for bringing the project to life after he single-handedly negotiated the deal with Mr. Lysich through the aid of a Russian translator. . .
At the time, we read that Mr. Lysich and his family sunk a ton of their own money into the project – which I found most admirable. After all, most developers would have just thrown some money around the right political campaigns and reaped the largesse of their elected hired hands.
Hell, if Mr. Lysich had played his cards right, I’ll bet Volusia County and the City of Daytona Beach would have thrown enough money at him to more than cover his overhead and reduce his personal liability in the project to a few rubles.
But not Protogroup.
Apparently, they wanted to finance their development the old-fashioned way: By borrowing the money from uber-wealthy foreign nationals seeking resident alien status in the United States. . .
Protogroup was said to be seeking investors under the EB-5 visa program, which some described as “murky, loosely regulated, and prone to abuse.”
Then, the News-Journal revealed some disturbing information that an Alexey Lysich of St. Petersburg, Russia may have been involved with an off-shore bank account in the Seychelles – a practice which is perfectly legal in some countries.
Unfortunately – and I know this is incredibly hard to believe – off-shore banking is sometimes used by unscrupulous people and businesses as a mechanism to launder money, hide assets and avoid the payment of U.S. taxes. . .
But none of that worried our ‘powers that be’ because our collective fears were assuaged when Mr. Lysich said that “. . . he doesn’t think it’s him, and that it could be anyone because “it’s a leak.” He had no further comment about it. He also said his family has no connection with the Russian government or contact with President Vladimir Putin.”
“Money is money. It’s U.S. dollars that I pay to the general contractor,” he said.”
Except, according to Protogroup’s general contractor, W.G. Yates Construction – they haven’t been paid by Mr. Lysich’s company in over three-months. . .
Well, money being money and all, last week the City of Daytona Beach saw fit to slap a Stop Work Order on the project – effectively putting the brakes on the spires that now sit like a whistling ghost tower – a gray monolithic monument to everything that’s wrong with our struggling core tourist area.
For a few anxious days, Fun Coasters were riveted by headlines such as “Stalled $192 million project causes worry,” as we sat in the shadow of the dull gray skeleton of the half-finished project.
Even our doddering fool of a County Chair, Ed Kelley, felt the need to insinuate himself into the discussion (?) by doing what our elected county officials do best – taking sides in matters that don’t concern them.
According to The Daytona Beach News-Journal, Old Ed said, “. . .he placed his faith in the statements by Protogroup’s Lysich that contractors had been paid, that a new, yet-to-be-named contractor was in the area and that new permits would be issued soon.”
“I have no reason to doubt that,” Kelley said. “I’d rather be optimistic about it than to say that it’s gloom and doom. I don’t believe they would have gone this far, put this much effort into the project, just to stop right now. Who are you going to believe? If they were paid in advance why would there be outstanding invoices? One of them is misstating something.”
Because – even if only two entities on earth know the facts – as a sitting member of the Volusia County Council, Old Ed Kelley is genetically programmed to immediately side with the “developer du jour” in all matters large and small.
That’s what passes for effective leadership here, folks.
The one person in our community who explained this dismal situation with perfect clarity was Tony Grippa – former chairman of that time-buying exercise known as the ‘Beachside Redevelopment Committee’ – whose bureaucratically neutered recommendations are now growing a thick patina of dust on executive credenza’s in city and county offices up-and-down A-1-A – called for an investigation by the Daytona Beach City Commission.
“I have real concerns, given what I know about Yates Construction’s reputation,” Grippa said. “If they were willing to continue the work, it’s troubling that the investors are not moving forward with the project. The city still lacks an overall strategy as it relates to A1A and the beachside corridor, and this is what happens when you put all your eggs in one basket.”
Make no mistake, it’s not just the City of Daytona Beach that lacks a clear strategy for the revitalization of our beleaguered beachside – our most important economic engine. When it comes to “vision” – our current crop of elected officials on the dais of power in DeLand (with the lone exception of Councilwoman Heather Post) have the foresight of one of those cave-dwelling salamanders who spend their slimy little lives in total darkness, slithering around in a dark hole in the ground.
After all, Old Ed and the Funky Bunch have uber-wealthy insiders with an obscene profit motive to do their thinking for them.
I ended my 2017 piece entitled “Money is money, Fuggedaboutit…,” with the following ominous statement, “Look, I wish Mr. Lysich well – and I hope his mega-project does everything for Daytona Beach that Mayor Ritchey promises it will – but we’ve been fooled before – and I’m not sure we can afford another boondoggle on the beach.”
But I think Mr. Grippa summed it up better when he said earlier this week, “It would be absolutely devastating to have, in addition to all the old boarded-up buildings, now a new partially completed building,” Grippa said. “That sitting vacant and empty would really hurt the beachside, optically, economically and emotionally.”
Gentle reader, the stakes are high. Just don’t look for clarity anytime soon – because things just got murkier. . .
On Wednesday, we learned that Protogroup – now d/b/a PDA Trading Inc. – owned by Alexey Lysich and his father, Petr, has hired a new general contractor – currently known as Gryffin Construction Corporation.
Even with a new contractor selected, given the questions that remain about on-going lawsuits, past performance claims and other issues – we now have no confidence that the same thing won’t happen again a few days, weeks or months from now.
And that could have a devastating impact on a core tourist area clinging to life by what’s left of its fingernails. . .
I, for one, join with Mr. Grippa in calling for an immediate investigation of the circumstances that led to this abrupt work stoppage – and the subsequent hiring of a company that apparently reactivated the corporation with the State of Florida just three days after the stop work order was issued – so that wary citizens, potential beachside investors and entrepreneurs can have some assurance that this project won’t wither and die like so many “game changers” before it.
Like a smart friend of mine recently said, “Get out the popcorn. This ones going to have a lot of twists and turns. . .”
It’s time once again to turn a jaundiced eye toward the newsmakers of the day – the winners and losers – who, in my cynical opinion, either contributed to our quality of life, or detracted from it, in some significant way.
Let’s look at who tried to screw us – and who tried to save us – during the week that was:
Angel: Cici Brown
October is National Breast Cancer Awareness Month, an annual international campaign to increase awareness and raise funds for research, prevention, diagnosis, treatment and cure.
Last week, Cici Brown – wife of Brown & Brown board chairman J. Hyatt Brown – bravely spoke about her battle with breast cancer at a wellness luncheon hosted by Halifax Health.
I learned something from Mrs. Brown’s experience: Some 85% of women with breast cancer have no family history of the disease. I also learned that 90% of women who are diagnosed with breast cancer survive due to technological advances in treatment and care methodologies.
According to The Daytona Beach News-Journal, Halifax Health now offers the 3-D mammogram, which has allowed doctors to discover 40% more early stage breast cancers by permitting them a view of layers of breast tissue instead of a single image provided by standard two-dimensional mammograms.
The Center for Disease Control’s United States Preventive Services Task Force recommends that “. . .if you are 50 to 74 years old, be sure to have a screening mammogram every two years. If you are 40 to 49 years old, talk to your doctor about when to start and how often to get a screening mammogram.”
Kudos to Mrs. Brown for having the courage to speak out as a cancer survivor and educate other women on the importance of getting regular screening.
Asshole: Daytona Beach International Airport
Look, there’s enough blame to go around on this one – but DIA shill Jay Cassens just happened to become the face of this latest ‘economic development’ boondoggle – so that county-funded bunch takes the cake this week.
Just three-years after Volusia County economic development types ponied up some $2.3 million in public incentives to lure JetBlue to Daytona “International” Airport – the carrier has announced plans to give area residents the slip as it moves to more lucrative markets and works to consolidate “underperforming” routes.
In luring the airline to Daytona Beach, our “movers & shakers” went so far as to develop a “travel bank” among local companies – to include Brown & Brown, Consolidated-Tomoka Land Company, International Speedway Corporation and Embry-Riddle Aeronautical University – which agreed to spend over a quarter-million dollars over two-years with JetBlue if they agreed to grace us with a one flight per day to New York’s JFK.
Add to that some $25,000 in free upgrades to the airlines gate location at DIA (that you and I paid for) and it was a pretty good deal – for JetBlue anyway.
Now, in typical Volusia County fashion, those of us who pay the bills and suffer in utter silence are left holding the bag on another disappointing “investment” that never seemed to live up the hype. . .
Not to worry – according to the always optimistic Chamber of Commerce set – you and I got a fantastic return on our multi-million-dollar outlay in “landing fees, facility charges, concessions such as airport parking fees, rental cars, food and beverage purchases at the airport’s restaurants (they have more than one?), and purchases at the airport’s gift shop. . .”
Look, I’m just spit-balling here, but that’s a butt-load of magazines, Tic-Tacs and bottled water. . .
Why is it that DIA officials crow, ad nauseum – month-in-month-out – that passenger traffic at DIA looks like some out-of-control airlift with hundreds-of-thousands of people flying in and out of Daytona Beach (which essentially consists of Delta and American giving folks a lift to and from their regional hubs).
Riddle me this:
If DIA is such a major success – with demand set to increase year-over-year – then why in the hell can’t we attract national air carriers without pissing away millions in public funds, private pledges and other over-the-top incentives then demanding that our business community get down on their hands-and-knees to beg them to service our feeble market?
And what’s to prohibit Mr. Cassens and the crew at DIA from ramming yet another ‘next big thing’ down our throats with tall-tales of all the ways you and I will “benefit” from throwing good money after bad in the latest, greatest corporate welfare giveaway?
Angel: Eddie Hennessy
I often pick on The Daytona Beach News-Journal’s business writer Clayton Park for his near-constant cheer leading efforts on behalf of our ‘movers & shakers’ as he continues to throw Chanel No. 5 on the hog.
But when he’s right – he’s right.
In this mornings paper is a wonderful article about one man’s efforts to almost single-handedly bring positive change to our beleaguered beachside.
By any measure, the multi-million-dollar restoration of the Streamline Hotel is a visual metaphor for the rest of the Halifax area – a dilapidated blight generator that then Chief Mike Chitwood once referred to as a “Den of Iniquity” – a once grand art deco style hotel which holds the distinction as the “Birthplace of NASCAR” after Bill France and friends met in the rooftop bar to hammer-out details of what would become racings sanctioning body.
Like a phoenix rising from the ashes of decrepitude, local entrepreneur Eddie Hennessy turned his vision into reality when he spent some $6 million to completely gut and rebuild this grand hotel – opening to great fanfare and success last year.
In the process, Hennessy generated some much-needed publicity for the “World’s Most Famous Beach” when the hotel’s renovation was prominently featured on a nationally televised reality show.
Now, Hennessy is breathing new life into areas surrounding his signature project.
Earlier this week plans were released for the imminent demolition of the former Shell’s restaurant property – another blighted shithole that has sat vacant for years.
According to Clayton Park’s excellent piece, “Streamline owner looks to ‘revitalize’ beachside”:
“He (Hennessy) confirmed that he is demolishing the long vacant former Shells seafood restaurant directly south of the Streamline to make way for a yet-to-be announced beachside redevelopment project.
The development will include most of that block as well as the block immediately west of it which fronts East International Speedway Boulevard.
It’s all part of his plan to “clean up the town,” he said, declining to divulge further details at this time.
“Streamline is the catalyst to the vision that I have,” he said. “I want to give Daytona Beach what it deserves as the World’s Most Famous Beach. It needs to look like it.”
From the “No Shit?” file, Nancy Keefer, CEO of the Daytona Regional Chamber of Commerce, said of Hennessy’s bold plans, “It is important for the private sector to step up,” when it comes to effecting positive change on the besieged beachside.
Who else is going to do it, Nancy?
Our ‘powers that be’ in Ormond Beach?
Those dullards on the Volusia County Council?
The Daytona Regional Chamber of Commerce?
These ineffectual do-nothings have had decades to do something – anything – to fundamentally change the cycle of blight, dilapidation and hopelessness that has left our core tourist area in tatters, created an artificial economy of haves-and-have-nots and perpetuated this shit-show of abject corruption and neglect that has crippled a once great tourist destination.
Don’t take my word for it – take a leisurely drive down A-1-A from Ormond Beach to Daytona Beach Shores. It’ll open your eyes.
Now, I join the growing chorus of concerned citizens who are begging the City of Daytona Beach and other beachside communities to get the hell out of Mr. Hennessy’s way, remove all bureaucratic impediments standing in the way of his bold vision and do everything possible to support entrepreneurial efforts to bring real economic development to the Halifax area.
Trust me. It’s now or never.
Asshole: Daytona Beach City Commission – First Step Project
Like everything else in Volusia County, we can’t even build and operate a homeless shelter without some weird sleight-of-hand between a public entity and an uber-wealthy government insider.
In fact, I’ve made a game out of it based upon the old “Six Degrees of Separation” theory that claims any two people on earth are just six or fewer acquaintance links apart.
I call it One Degree of Volusia.
Invariably, a curious citizen can link most any corporate handout or sweetheart deal involving the massive transfer of public funds or assets to a private, for-profit interest with any member of our secret camera stellate at the Volusia CEO Business Alliance with just one move.
Try it sometime.
Last week, Daytona Beach City Commissioners moved to sell fill dirt from the 626-acre publicly-owned site in the pine scrub off ISB where the new First Step homeless assistance center is ostensibly going to be built sometime in the next decade.
In keeping with what city officials have described as “value engineering,” by unanimous vote, last week the City Commission approved an amended agreement with P$S Paving which allows the contractor to dig two or more “retention ponds” with a “target volume” of 40-acres (by comparison, the First Step site sits on about 10-acres?) for an estimated haul of 1.4 million cubic yards of extremely lucrative fill dirt.
You see, quality dirt is important to Florida developers – especially during periods of explosive growth.
It’s called supply and demand, baby.
Given our sensitive topography, dirt is necessary for filling, stabilizing and raising the grade of building sites. With the current sprawl of residential developments that have been approved along the spine of east Volusia from Farmton to the Flagler County line – suitable fill dirt is in short supply – and he who controls a massive quantity of it can, in essence, set the market and become incredibly wealthy in the process.
Under the terms of the arrangement, P$S Paving will pay the citizens of Daytona Beach just $1.50 per cubic yard – or $2.00 per cubic yard if they are permitted to dig more ponds on the city land.
Now, city officials and other “experts” they spoke with claim that after permitting and overhead, fill dirt excavators net just a couple bucks per cubic yard. Hell, to hear them tell it – it’s hardly worth the effort. . .
Look, don’t take my word for it. Do a quick Google search on what you would pay per cubic yard for fill dirt on the open market.
Go ahead – I found it selling locally for as high as $25.33 per cubic yard.
As I understand it, once permits are obtained, P$S Paving will pay the City of Daytona Beach $1.06 million – and an additional $1.06 million once the dirt is excavated. To facilitate the deal, P$S Paving also agreed to knock $1.06 million off the $1.62 million it was charging the City for “site preparation work.”
The City of Daytona Beach is claiming that the deal will reduce the stratospheric cost of the shelter project by as much as $2 million.
At the rate costs on this mismanaged boondoggle have been rising – that’s like throwing a deckchair off the Queen Mary. . .
Ultimately, under the terms of this arrangement, which, in my opinion, has absolutely nothing to do with the “site preparation work” the company was originally contracted for – P$S Paving stands to pocket between $7 million and $14 million on the deal.
Now, way back when I accepted public funds and served in the public interest, I always felt that government had both a moral and legal obligation to sell public assets to the “highest and best” bidder, or at public auction, following a statutorily mandated publication process set in the best interest of the community.
Why? Because its good public policy, that’s why.
It’s also the law.
When you factor in the massive lift station, with a capacity hundreds of times more than what would be required for the First Step project, and one gets the sneaking suspicion that the remaining 616-acres of property – which will ultimately have some 40-acres of retention and water features – is being groomed for another, more lucrative, use that has absolutely noting to do with warehousing the homeless?
In my view, it has all the earmarks of another “lifestyle” community.
Time will tell.
It’s this messy blend of public/private – a shell game that involves hiring a prolific government contractor for one purpose, then conveniently “amending” the agreement to include the potential of a multi-million-dollar windfall for that same contractor – without any competitive process to ensure that the long-suffering citizens of Daytona Beach are receiving anything close to fair market value for their property.
Add to that City Manager Jim Chisholm’s arbitrary decisions to “value engineer” this out-of-control debacle by simply transferring construction costs to the First Step Shelter Board – a multi-disciplinary group of volunteers who are working diligently to raise operating funds, yet have been treated like mushrooms by the City since its inception – and you get the idea that things may well be worse than any of us know.
I guess it’s good to be connected.
It’s even better to be a sitting member of the Volusia CEO Business Alliance – like Tim Phillips, president of P$S Paving. . .
See what I mean?
I’m just spit-balling here – but aren’t we supposed to have an Attorney General in this state charged with investigating public/private partnerships when they detect a whiff of shit?
Quote of the Week:
“It is time to stop approving further residential development on the city’s west side until we understand all the consequences and create a long-term strategy for responsible development. Developers should not be the only people who will benefit from the growth in our community, while the rest of us pay the price.”
–Linda Smiley, president of Citizens 4 Responsible Development, writing in The Daytona Beach News-Journal’s Letters to the Editor, “Put the brakes on intense growth,” Tuesday, October 9, 2018
And Another Thing!
Eventually, the Volusia County Council is going to have to make a decision.
Recently, those dullards we elected to represent our interests on the dais of power in DeLand kicked the can a little further down the road on perhaps the most import decision of their tenure – the selection of our next county manager.
But rather than show bold leadership and move forward with efforts to select the best and brightest executive we can afford – there is “disagreement” among our elected officials as to how best to simply begin the process.
In my view, Volusia County employs some incredibly smart people who are infinitely capable of gathering a comprehensive list of qualified candidates.
We also have very talented public servants in every municipality in the county who routinely perform complex background investigations, gather open source information, interview former employers, character references, perform neighborhood canvasses and learn everything humanly possible about potential public employees.
Instead, the Volusia County Council has chosen to employ their patented political insulation tactic of paying thousands of taxpayer dollars to a contractor to do what they are infinitely capable of doing for themselves.
Now, council members will hear pitches from two headhunter firms before selecting one to represent our collective interests for around $25,000.
In turn, the winning consultant will trot out the usual list of “Managers in Transition” and a few from the Great Frozen North who are looking for a retirement gig in the Sunshine State.
The Intrepid Councilwoman Heather Post is right – this is the most important decision the council will make.
But why not make it an open, transparent and inclusive process – conducted in the bright light that only open government laws can ensure – then remove the middleman and make this a countywide selection that we can all be proud of?
Or, maybe they should just cut the shim-sham and do what will ultimately happen anyway = Just put it to a secret vote of the Volusia CEO Business Alliance and be done with it. . .
Here’s hoping that all members of the loyal Barker’s View Tribe will take a minute this weekend to make a donation to the American Red Cross or the relief and recovery organization of your choice in support of those affected by Hurricane Michael.
You’ll be glad you did – and God knows they need the help. Thank you.
Looks like we may have our first touch of “Fall Weather” on Saturday morning! I don’t know about you – but I’m ready for it. . .
Barker’s View will be on a brief hiatus next week, taking a short ‘pause for the cause’ as Patti and I take a few days away.
As always, have a great weekend, kids!