U.S. GOVERNMENT PUBLISHING OFFICE

35–697 PDF WASHINGTON : 2019

S. HRG. 116–21 

LIBERTY CITY RISING: ACHIEVING UPWARD 

MOBILITY THROUGH SMALL BUSINESS 

AND COMMUNITY PARTNERSHIPS 

FIELD HEARING 

BEFORE THE

COMMITTEE ON SMALL BUSINESS 

AND ENTREPRENEURSHIP 

UNITED STATES SENATE 

ONE HUNDRED SIXTEENTH CONGRESS 

FIRST SESSION 

FEBRUARY 1, 2019 

Printed for the Committee on Small Business and Entrepreneurship 

( 

Available via the World Wide Web: http://www.govinfo.gov 

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(II) 

COMMITTEE ON SMALL BUSINESS AND ENTREPRENEURSHIP 

ONE HUNDRED SIXTEENTH CONGRESS 

MARCO RUBIO, Florida, Chairman 

BENJAMIN L. CARDIN, Maryland, Ranking Member 

JAMES E. RISCH, Idaho 

RAND PAUL, Kentucky 

TIM SCOTT, South Carolina 

JONI ERNST, Iowa 

JAMES M. INHOFE, Oklahoma 

TODD YOUNG, Indiana 

JOHN KENNEDY, Louisiana 

MITT ROMNEY, Utah 

JOSH HAWLEY, Missouri 

MARIA CANTWELL, Washington 

JEANNE SHAHEEN, NEW HAMPSHIRE 

EDWARD J. MARKEY, Massachusetts 

CORY A. BOOKER, New Jersey 

CHRISTOPHER A. COONS, Delaware 

MAZIE K. HIRONO, Hawaii 

TAMMY DUCKWORTH, Illinois 

JACKY ROSEN, Nevada 

MICHAEL A. NEEDHAM, Republican Staff Director 

SEAN MOORE, Democratic Staff Director 

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(III) 

C O N T E N T S 

OPENING STATEMENTS

Page 

Rubio, Hon. Marco, Chairman, a U.S. Senator from Florida ............................... 1 

WITNESSES

Panel 1 

Edmonson, Hon. Audrey, Chairwoman, District 3, Miami-Dade County Board 

of Commissioners ................................................................................................. 6 

Wilson, Hon. Frederica, Representative, Florida’s 24th Congressional District 14 

Panel 2 

Bendross-Mindingall, Dr. Dorothy, School Board Member, Miami-Dade County School Board .................................................................................................... 17 

Liu, Mr. Michael, Executive Director, Miami-Dade County Department of 

Public Housing & Community Development ..................................................... 19 

Van Hook, Mr. Brian, Associate Director, Florida SBDC at Florida International University .............................................................................................. 26 

Baker, Ms. Mary Burke, Government Affairs Counselor, K&L Gates LLP, 

Washington, DC ................................................................................................... 33 

ALPHABETICAL LISTING

Bendross-Mindingall, Dr. Dorothy 

Testimony .......................................................................................................... 17 

Baker, Ms. Mary Burke 

Testimony .......................................................................................................... 33 

Prepared statement .......................................................................................... 35 

Edmonson, Hon. Audrey 

Testimony .......................................................................................................... 6 

Prepared statement .......................................................................................... 10 

FIU Report on Small Businesses in Miami-Dade County 

Report titled ‘‘Small Business, Big Impact’’ ................................................... 52 

Liu, Mr. Michael 

Testimony .......................................................................................................... 19 

Prepared statement .......................................................................................... 23 

Rubio, Hon. Marco 

Opening statement ........................................................................................... 1 

Van Hook, Mr. Brian 

Testimony .......................................................................................................... 26 

Prepared statement .......................................................................................... 29 

Wilson, Hon. Frederica 

Testimony .......................................................................................................... 14 

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LIBERTY CITY RISING: ACHIEVING UPWARD 

MOBILITY THROUGH SMALL BUSINESS 

AND COMMUNITY PARTNERSHIPS 

FRIDAY, FEBRUARY 1, 2019 

UNITED STATES SENATE, 

COMMITTEE ON SMALL BUSINESS

AND ENTREPRENEURSHIP, 

Miami, FL. 

The Committee met, pursuant to notice, at 9:08 a.m., in the 

Sandrell Rivers Theater, Fantasy Theater Factory, 6103 NW 7th 

Avenue, Hon. Marco Rubio, Chairman of the Committee, presiding. 

Present: Senator Rubio. 

OPENING STATEMENT OF HON. MARCO RUBIO, CHAIRMAN, A 

U.S. SENATOR FROM FLORIDA 

Chairman RUBIO. Today’s hearing of the Senate Committee on 

Small Business and Entrepreneurship will come to order. 

I want to thank everyone for making the time to be here on this 

topic, which I know is important to this community. 

This hearing is significant to me. It’s my first as the Chairman 

of the Senate Committee on Small Business and Entrepreneurship, 

and I’m very happy to be able to do it here at home and here in 

the heart of Liberty City. I also want to be able to use this gavel. 

[Laughter.] 

So anyway, it was originally scheduled, actually, to be last summer when I wasn’t the Chairman. Unfortunately, we had a tragic 

situation in Jacksonville that we had to respond to or pay attention 

to, so we couldn’t do it. And then we got off to a slow start in 

Washington this year, as you may have followed on the news, so 

I’m glad that it was able to be resolved and we were able to get 

to this point today. 

I want to thank all of our witnesses, and I want everybody to understand that the record—this committee has numerous members, 

a bipartisan committee, obviously. The testimony here becomes 

part of the record, which then becomes part of our work. Members 

and staff will look at that, and we use it to justify and to point to 

as the reasons why we need to do certain things and the laws that 

we’re going to be thinking about doing. 

So my number-one priority as the Chairman is to pass bipartisan 

legislation, which in the Senate, if it’s not bipartisan, it’s very difficult to pass anything, but bipartisan legislation that is going to 

expand economic opportunity for small businesses and for entreLAP51NQ082 with DISTILLER

2 

preneurs who are forced to take on personal risk and sacrifice to 

compete in the global marketplace. 

Entrepreneurship relies on ingenuity, it relies on innovation, and 

it also relies on access to capital. If you don’t have access to money, 

you can’t start businesses, and that’s a huge challenge for small 

business. 

And for a small business to be able to compete and to thrive, it 

has to have access as well to markets, it has to have access to funding, it has to have access to a workforce, to the people that can 

work there. 

These are enormous challenges. Big companies can afford all of 

this, and it is why you have seen growing consolidation of business 

activity at the expense of small business activity. 

And I can just tell you that I have nothing against big businesses, but they are no replacement for small businesses, because 

small businesses are rooted in the community. They are from the 

community. They hire people from the community. The leader, the 

founder, the president of a small business is likelier to be your PTA 

president, your Chamber of Commerce president, involved in your 

community than some large chain. 

And so that’s why we’re so deeply committed to ensuring that we 

can do everything we can to get small business activity going in 

this country and focused in the right places. 

Inherently, when you start a small business, you’re growing jobs, 

you’re growing opportunity. And when these are done successfully, 

then that’s when upward mobility becomes possible. 

The issues of upward mobility in South Florida, which is close to 

home for me, and that’s both geographic and personal—I was born, 

raised most of my life, and still reside about 30 minutes from here, 

at this time of day maybe, and I don’t know how much in tolls. 

That’s another topic. But about 15 minutes or 20 otherwise, and so 

I’m acutely aware of this community, and everyone identifies this 

community with shining buildings and beautiful access to the ocean 

and all the fun things there are to do here. All of that is true. What 

I try to explain to people about South Florida is that within just 

a few blocks from some of these landmarks, internationally recognized buildings and activities are people who are really struggling 

for a lot of different reasons. 

And so I hope that we can find a way, not just for the families 

of Florida but across the country, to have the ability to build better 

lives for themselves and for their loved ones, and I truly believe 

that that begins with dignified work. 

Work is not just about a paycheck. Work is about the dignity 

that comes attached with the fact that you get up in the morning 

and that your efforts are rewarded, and with that, it feeds the spirit and human soul, and the lack of access to dignified work has the 

reverse effect. It’s corrosive to the individual, ultimately to families, 

and then to communities. 

I believe our economic policies should be anchored first and foremost in the creation of dignified work. You can’t have it without 

economic growth, you can’t have it without prosperity. But the goal 

of that prosperity and that growth should always be to provide our 

people the opportunity to acquire dignified work, and small businesses are an incredible engine for that. 

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And it’s reflected in the policies we’ve pursued; for example, the 

increase to the Child Tax Credit. We didn’t get there all the way 

but we got a lot, and this year millions of American families will 

have more of their own money—this is their money—in their pocket, particularly lower-income Americans who are working and 

whose primary tax liability is the payroll tax. 

Everybody pays the payroll tax, and more and more American 

families are going to have that money left in their pocket because, 

I don’t need to tell people in South Florida, raising children is more 

expensive than it’s ever been. There are more costs than ever, and 

everything costs more. 

We are also working in a bipartisan way with Congresswoman 

Wilson on enhancing safety standards at HUD-assisted housing. 

It’s great to have facilities that, obviously from a physical structure 

perspective, are appropriate, but they also have to be safe. You 

can’t prosper, you can’t have upward mobility if you can’t sleep at 

night because you’re worried about the gunshots, you’re worried 

about your children even being outside, you’re worried about the violence and the security standards are not in place. 

So we really want to continue to press HUD to ensure that both 

the funding and the requirements are in place so that people living 

in HUD-assisted housing are living in a safe environment. 

We also want to sort of deal with the regulations that have an 

inordinate impact on small business. Big businesses hire these 

large law firms that help them navigate this stuff, and accountants 

that help them find loopholes. Small businesses are stuck. So we 

all agree we have to have regulations that keep us safe and keep 

it fair. But when those regulations become an onerous cost of being 

in business, small businesses really struggle because they just can’t 

afford the lobbyists, lawyers, and accountants to figure their way 

through all of this, and that’s what we’ve pushed our agenda here 

to do. 

Being here today is an honor. Liberty City has a long and proud, 

and yet a complicated history. It’s something I don’t need to tell 

people here today, but my colleagues need to know, and it needs 

to be in the record. 

In recent years, Liberty City has been characterized as a community that suffers from poverty and schools that have struggled and 

majority single-parent households and a declining workforce. However, history tells us that this is a community that not that long 

ago was a thriving community of entrepreneurs with economic opportunity, with strong families. I think those virtues, those values, 

and those ambitions remain in the heart and in the soul of the people who live here. 

It was built during the New Deal as one of the first housing 

projects in the South. It was the home, as I said, of a thriving African-American middle class. And when I–95 was built in the 1960s, 

the landscape of this community changed, and so did the 

socioeconomics. 

Obviously, we’ve seen what’s happened since then, the economic 

opportunities disappearing and too often being replaced with gangs 

and drugs and violence. And despite that, resilient families still 

live here and are raising their children and finding a way forward. 

They’re incredible success stories. 

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This is a resilient community. It’s made incredible contributions. 

Individuals who grew up and were raised here have gone on to do 

extraordinary things on behalf of our county, our city, the State of 

Florida. 

Obviously, a recent—maybe some of you have seen the series on 

Starz on the Warriors, which is a program we’re familiar with because of my own sons’ participation in youth football. Our record 

wasn’t very good against them, but it just highlights the extraordinary success stories that have emerged despite all these challenges from this community. 

I think it’s also the home of the Bulls. Is that right, Dorothy? 

Well, I don’t want to get into the football rivalry. 

[Laughter.] 

I saw them up there in—they were up in Orlando this year, and 

they did very well. But Booker T’s coming back. They’ll have a good 

year this year. Okay. Right? You have both of those in your district? Okay. I don’t want to put you in a tough spot. 

[Laughter.] 

So what is the thing that turned the community around? That 

is what we are here to find out about. I have some thoughts coming 

in, but I can tell you that it’s going to take a combined effort, a 

partnership of local, State, Federal, school board, elected officials, 

community leaders and, of course, the residents. We shouldn’t be 

in a position of telling people what they need. We need to be in a 

position of giving people the opportunity to tell us what needs to 

happen. 

And I want you to know, that does happen. Last year, we were 

in South Florida, we were in Broward and Palm Beach, and we 

heard about a local problem with sober homes, where people were 

opening up these fake rehab centers and it was undermining the 

community, and we were able to take that local concern and turn 

it into Federal legislation, and that’s what we’re hoping to do here 

today. 

Now, with that in mind, let me just give you my one thought. 

This is about upward mobility. But oftentimes, upward mobility 

means the people living there have to move out. That’s what upward mobility has meant. Yes, tax changes or something happens 

and there’s investment in a community, but then it gets too expensive for the people who are there to stay, or housing is replaced by 

something else. 

We are not here to talk about upward mobility in that sense. 

We’re here to talk about an upward mobility that belongs to the 

people who are here, that this can continue to be home, that people 

don’t have to find a way to move out because, frankly, there is nowhere to go. There are no other housing options, and plus this is 

a community that belongs to the community. 

So we are not here today to promote gentrification. We are here 

today to try to figure out what we can do at the Federal level to 

promote upward mobility for the men, women, children and families of Liberty City, what can we do in Federal policy to work 

alongside our local and State officials to make that happen. 

It’s my hope that the hearing today will highlight the impact 

that small business and entrepreneurs and other community stakeholders can have to help this community achieve that because, as 

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I said, small business is rooted in the community. When the small 

business owner grew up in the community, lives a few blocks away 

from the business, they’re going to hire locals, and they are going 

to be contributors to local partnerships and local organizations. 

There is no way—we are grateful to the big businesses that give 

the big checks to the organizations once a year—nothing wrong 

with that. But we understand the intrinsic value of businesses that 

are deeply rooted in the community that they work in and serve. 

In 2017, there was a provision in the tax law that created Opportunity Zones. This law was championed by my very close friend, 

Senator Tim Scott of South Carolina. That law is going to encourage investment in communities such as this. It will allow investors 

to defer certain taxes on income when they choose to invest in 

qualified areas like Liberty City. But it’s important that that be 

done in a way that’s long term and that doesn’t force out the people 

that are here and the opportunities for locally based investment. 

We’ve experienced that here firsthand in South Florida. As I 

mentioned at the outset, the disparities in Miami are a testament 

to the uneven prosperity of globally driven rapid growth of a 21st 

century economy. This new economy has been very good for a lot 

of people, and God bless them, we’re not against them, but it has 

left some people behind, and that is what we need to figure out, 

how we can balance out. 

And that is where the Opportunity Zones can come in if appropriately used as a tool. When investors are in a global economy, 

they are always seeking a bigger bottom line by taking jobs and 

sending them somewhere else, maybe another country. We don’t 

want to see that happen. Instead of sending those jobs to another 

country, being able to bring those jobs to the communities that 

have been left behind by the 21st century economy. 

And one of the things that this law does to prevent that from 

being short-term thinking, like how can I get somewhere and maximize my gains and then move on somewhere else, is you have to 

hold the investment for at least 10 years. You don’t get this benefit 

unless you are anchored in for at least 10 years. That’s not a long 

time, and we want this to be permanent. But if you can anchor 

someone down to 10 years, they’re probably staying, especially as 

the roots grow deeper. 

By the way, and I’ve already highlighted this, Congresswoman 

Wilson and I, who will be here later, we have sponsored two pieces 

of bipartisan legislation. The first is Liberty City Rising Act. What 

it does is it increases the safety standards and prioritizes funding 

for additional security measures at public housing projects located 

in areas that statistically have suffered from high crime. 

We introduced the Safe Temperature Act to allow HUD to require air conditioning units be installed in properties located in 

very hot places. Miami’s a very hot place in July. Actually, it’s okay 

right now too, especially if you live in Chicago and it’s 74. It’s cold 

up there. But no family, particularly no child, should be forced to 

live in a home that doesn’t have air conditioning and the temperatures are over 100 degrees. 

Last year I had a bill that passed called the Spurring Business 

in Communities Act that was signed into law. This encourages the 

creation of new small business investment companies. We’re going 

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to hear more about that today. But it encourages setting them up 

in under-licensed states, and Florida is an under-licensed State. 

This will encourage more private-equity investment to fund small 

business entrepreneurship and innovation, particularly focused on 

left-behind communities like Liberty City has been, and we’ve 

talked about that at the outset. One of the biggest impediments to 

small business formation is you need money to make money sometimes. You need money to start a business. This will hopefully 

drive more of that investment in that direction. 

These are a few of the measures that we can do at the Federal 

level. There’s probably more that needs to be done. These are very 

useful to us because it allows us to come up with ideas that we 

wouldn’t otherwise have thought of, because as I said, there is a 

lot of technological advances, shifting economic trends globally, but 

we have to fight to remain economically competitive, and that begins with our people. And we are going to work with our colleagues 

to make sure that we see this through. 

So today what we have is two panels that will testify, and their 

testimony will be a part of our record, and from it we’re going to 

pull out ideas, and they’re going to be able to speak to that further. 

I want to thank the Deputy Mayor of the county, Maurice Kemp, 

for joining us today. I know Mayor Gimenez couldn’t be here today, 

but our first panel is going to be Congresswoman Wilson, when she 

gets here, and Chairwoman Edmonson. We have a tight timeframe 

as well, because we’ve got to be out by 10:45, so we have an hourand-a-half here. So I’d just ask everybody to keep that in mind 

with their comments, because we have a second panel that’s coming up. 

Maybe I’ll start with you, Madam Chair, because you represent 

this community on the school board. You’ve worked on the issues 

of the tenants. 

Did I say school board? You’re not the Chair of the school board 

yet, are you? 

[Laughter.] 

That’s probably what confused me. Of the county. I apologize. 

You’re Chair of the county, but you’re also the Chair of the Housing and Social Services Committee and the Building Safer Neighborhoods Subcommittee. 

As a member of the Youth Crime Task Force, your activity on 

Operation Restoration, which is an anti-crime strategy group, your 

expertise in youth development runs deep. 

You’ve worked here for a long time, and I can’t think of a better 

witness to start off our hearing with, so thank you for being here. 

[Applause.] 

STATEMENT OF HON. AUDREY EDMONSON, CHAIRWOMAN, 

DISTRICT 3, MIAMI–DADE COUNTY BOARD OF COMMISSIONERS 

Ms. EDMONSON. And thank you, Senator. I liked the introduction. 

Maybe one day I’ll be school board and Dorothy will be on the county—— 

Chairman RUBIO. Don’t start rumors. 

[Laughter.] 

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Ms. EDMONSON. Good morning and welcome to Miami-Dade 

County and Commission District 3. I was honored to accept the invitation to be a part of this distinguished panel, along with Congresswoman Frederica Wilson and Mayor Carlos Gimenez, who I 

think is not here, but we do have Deputy Mayor Maurice Kemp, 

and they have provided tremendous support on the Liberty City 

Rising project. 

As the District Commissioner for this area, I’m honored that you 

have chosen this community to convene this hearing of the U.S. 

Senate Committee on Small Business and Entrepreneurship as we 

discuss Liberty City Rising specifically and achieving economic 

growth around our housing communities in general. 

After being elected by my colleagues to serve as Chairwoman of 

the Board of County Commissioners, I have now said affordable 

workforce and public housing would be one of my top priorities. 

The Board of County Commissioners recently received a report that 

indicated that since 1989 the county has funded 238 affordable 

housing projects, and that’s including public housing. 

In spite of these efforts, because of our rapidly growing population and the rising cost of housing, we still have thousands of 

people who cannot afford to live in greater Miami and struggle 

with the cost of housing. I am committed to ensuring that the county continue to redevelop our aging public housing and to build suitable, affordable housing for our working class and our most vulnerable residents and our elderly. 

I know that we must explore collaborative ways of working with 

private entities and developing community partnerships, as well as 

fostering small business creation and entrepreneurship to achieve 

upward mobility for distressed communities. So I thank this committee for coming to Miami-Dade County to put a spotlight on this 

issue. 

We welcome the Federal Government’s participation and support 

in our efforts to rebuild our communities from the ground up. This 

county has certainly done its part to prove our commitment to this 

cause by putting a great deal of our own skin in the game. The Liberty City Rising project is one of the fine showcases of these efforts, 

and I have devoted countless hours working to ensure this multimillion-dollar plan to revitalize Liberty Square and other public 

housing projects are a success. 

The Liberty Square redevelopment, which was first announced in 

February of 2015, seeks to address the issues of crime and poverty 

in the area by raising the standard of living for residents and creating opportunities to earn a decent living. The project, which 

broke ground in May 2017 and is expected to be completed by the 

end of next year, involves demolishing and rebuilding Liberty 

Square’s 709 public housing units in phases without displacing any 

residents. 

The end product will be a bustling mixed-income community with 

shops, parks, and 1,400 condos, townhouses, and apartments. It 

will transform residents’ lives in the community by bringing health 

care, early childhood education, educating for youth and adults, job 

training, youth programs, elderly programs and, yes, small business development to the area. 

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8 

I am grateful to Senator Rubio for addressing the need for safety 

and security in our public housing across this Nation and to know 

that we are not alone in this fight to redevelop our public housing 

and ensure the safety of our residents. Miami-Dade County has 

committed $74 million for the Liberty City Rising revitalization initiative, which will be used to leverage over $390 million of economic activity and private-sector investment. 

Miami-Dade County has already allocated $46 million in funding 

for the redevelopment of Liberty Square and Lincoln Gardens, 

which will generate over $307 million in economic activity and private-sector investment. 

Chairman RUBIO. You don’t have to start over again. 

[Laughter.] 

Ms. EDMONSON. I’m not going to start over again. 

[Laughter.] 

They told me to stick to the script, so I’m trying to stick to the 

script so I won’t go over. 

Thank you. Okay. Can you all hear me better? Okay. 

We have allocated an additional $28 million to revitalize the Liberty City neighborhood. These funds will be utilized to create additional safety measures and economic activity through the construction of new multi-family housing, affordable and workforce housing, 

affordable home ownership opportunities, economic development, 

and capital improvements. 

The Liberty City Rising revitalization initiative will create an estimated 2,300 jobs, in addition to addressing the high unemployment rate in this neighborhood, and ensure that many of these jobs 

are filled by local residents. The county established the Employee 

Miami-Dade Program to train and assist in the hiring of residents 

from the Liberty City Rising zip codes. 

So often when a community has been plagued by the violence 

that tends to go hand in hand with poverty, it cannot attract small 

businesses and thrive economically unless these initiatives are 

combined with our efforts to address the epidemic of gun violence. 

That’s why I have also made fighting the scourge of gun violence 

one of the top priorities of my two-year chairmanship. I’m 

strategizing with local law enforcement, our school systems, multiple agencies and community-based organizations to address this 

epidemic. I have introduced new legislation before the Commission 

to enhance these efforts with a boots-on-the-ground approach, 

which should be starting somewhere near March, next month. You 

will start seeing billboards out there warning the people that we 

are serious about gun violence. 

We are working with local organizations, clergy, law enforcement, and our juvenile services department to bring peace and 

safety to our neighborhoods. 

Working with my colleagues on the Board of County Commissioners, our Federal, State, and local partners, and especially our 

community partners on the front lines, I am confident that all the 

efforts will be approved and that Liberty City Rising will not only 

transform the community but will serve as a model of urban revitalization in other parts of our county and the entire Nation. 

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9 

Thank you, and I look forward to continue working with you on 

these very important efforts. We welcome and appreciate your vital 

support and participation. 

And before I step down, I don’t think we introduced one of my 

colleagues, our former Chair of the board, Mr. Esteban Bovo. 

[Applause.] 

[The prepared statement of Ms. Edmonson follows:] 

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Insert offset folio 44 here 35697.044

Audrey M. Edmonson 

Chairwoman 

Miami-Dade Board of County Commissioners 

Good morning and welcome to Miami-Dade County and to County Commission District 3. I was 

honored to accept this invitation to be a part of this distinguished panel along with Congresswoman 

Frederica Wilson and Mayor Carlos Gimenez, who have provided such tremendous support on the 

Liberty City Rising project. As the District Commissioner for this area, I'm honored that you have 

chosen this community to convene this hearing of the U.S. Senate Committee on Small Business 

& Entrepreneurship as we discuss Liberty City Rising specifically, and achieving economic growth 

around our housing communities in general. 

After being elected by my colleagues to serve as Chairwoman of the Board of County 

Commissioners, I announced that enhancing Affordable, Workforce and Public Housing would be 

one of my top priorities. 

The Board of County Commissioners recently received a report that indicated that since 1989, the 

County has funded 238 affordable housing projects, including public housing. In spite of these 

efforts, because of our rapidly growing population and the rising cost of housing, we still have 

thousands of people who cannot afford to live in greater Miami and struggle with the cost of 

housing. I am committed to ensuring that the County continues to redevelop our aging public 

housing and to build suitable, affordable housing for our working class and our most vulnerable 

residents and our elderly. I know that we must explore collaborative ways of working with private 

entities and developing community partnerships as well as fostering small business creation and 
11 

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Insert offset folio 45 here 35697.045

entrepreneurships to achieve Upward Mobility for distressed communities. So I thank this 

committee for coming to Miami-Dade County to put a spotlight on this issue. 

We welcome the federal govermnent's participation and support in our efforts to rebuild our 

communities from the ground up. This County has certainly done its part to prove our commitment 

to this cause by putting a great deal of our own skin in the game. The Liberty City Rising project 

is one of the fine showcases of these efforts. and I have devoted countless hours working to ensure 

this multimillion-dollar plan to revitalize Liberty Square and other public housing projects are a 

success. 

The Liberty Square redevelopment, which was first announced in February 2015, seeks to address 

the issues of crime and poverty in the area by raising the standard of living for residents and 

creating opportunities to earn a decent living. 

The project, which broke ground in May 2017 and is expected to be completed by the end of next 

year, involves demolishing and rebuilding Liberty Square's 709 public housing units in phases 

without displacing any residents. The end product will be a bustling, mixed-income community 

with shops, parks, community facilities and 1,400 condos, townhouses and apartments. It will 

transform residents' lives and the community by bringing healthcare, early childhood education, 

education for youths and adults, job training, youth programs, elderly programs and yes, small 

business development to the area. 

I am grateful to Senator Rubio for addressing the need for safety and security in our public housing 

across this nation, and to know that we are not alone in this fight to redevelop our public housing 

and ensure the safety of our residents. 
12 

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Insert offset folio 46 here 35697.046

Miami-Dade County has committed $74 million for the Liberty City Rising revitalization 

initiative, which will be used to leverage over $390 million of economic activity and private sector 

investment. 

Miami-Dade County has already allocated $46 million in funding for the redevelopment of Liberty 

Square and Lincoln Gardens, which will generate over $307 million in economic activity and 

private sector investment. 

We have allocated an additional $28 million to revitalize the Liberty City neighborhood. These 

funds will be utilized to create additional safety measures and economic activity through the 

construction of new multifamily housing, affordable and workforce housing, affordable 

homeownership opportunities, economic development and capital improvements. The Liberty City 

Rising revitalization initiative will create an estimated 2,300 jobs. In addition, to address the high 

unemployment rate in this neighborhood and ensure that many of these jobs are filled by local 

residents, the County established the Employ Miami-Dade program to train and assist in the hiring 

of residents from the Liberty City Rising zip codes. 

So often when a community has been plagued by the violence that tends to go hand in hand with 

poverty. it cannot attract small businesses and thrive economically unless these initiatives are 

combined with our efforts to address the epidemic of gun violence. That's why I have also made 

fighting the scourge of gun violence one of the top priorities of my two-year chairmanship. I am 

strategizing with local law enforcement, our school system, multiple agencies and communitybased organizations to address this epidemic. 
13 

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Insert offset folio 47 here 35697.047

I have introduced new legislation before the Commission to enhance these efforts with a "boots 

on the ground" approach- working with local organizations, clergy, law enforcement and our 

County's Juvenile Services Department to bring peace and safety to our neighborhoods. 

Working with my colleagues on the Board of County Commissioners, our federal, state and local 

partners and especially our community partners on the front lines, I am confident all these efforts 

will bear fruit, and that Libe1ty City Rising will not only transform the community but will serve 

as a model of urban revitalization in other parts of our County and for the entire nation. 

Thank you, and I look forward to continue working with you on these very important efforts. We 

welcome and appreciate your vital support and participation. 
14 

Chairman RUBIO. Thank you so much. I know you’re going to be 

here for a while, but if you need to step out early—she’s got the 

whole county to overlook now. She’s the Chair. But we appreciate 

you being a part of it, and we want to thank Commissioner Bovo, 

who is the previous Chair, and a lot of the projects he’s been very 

supportive of that started under his Chairmanship. So it’s important to see that continuity in this county-wide commitment. I appreciate your comments and in particular your goal, which is something I should have said, and I’m glad you did. 

Our hope here is not just to get this right but to do it in a way 

that other people are coming down and asking us how did you guys 

do it, because we want to do what you did. 

But thank you for everything you’re doing. I really look forward 

to working closely with you on all of this. Thank you. 

Ms. EDMONSON. Thank you. 

[Applause.] 

Chairman RUBIO. Congresswoman Wilson, are you ready? 

[Applause.] 

As she walks up and gets ready, I’ve already outlined our two 

projects that we’re working on together with Liberty City Rising 

and the safety features of HUD, and also the air conditioning requirement. But we’ve been working together for a long time. It goes 

all the way back to our time in Tallahassee. So it’s been a great 

partnership, and it will take a Federal and State partnership here, 

and having her as the leading voice in the House on these issues 

is going to be incredibly important. 

So, thank you for being here today. 

STATEMENT OF HON. FREDERICA WILSON, REPRESENTATIVE, 

FLORIDA’S 24TH CONGRESSIONAL DISTRICT 

Ms. WILSON. It’s so wonderful to be here with you. It’s so great 

to be here with you this morning. This is what we call a field hearing, and a field hearing is when Congress leaves Washington and 

comes to a particular community to talk with you and listen to you. 

We all know that everyone can’t come to Washington to meet with 

us, so we have field hearings. So I want to thank my good friend 

and partner in crime on so many issues, Senator Rubio, for organizing this field hearing in the heart of Liberty City. 

We have some economic situations that we need to discuss today, 

and this is the kind of bipartisan working relationship that puts 

people first that voters envisioned when we went to the polls last 

fall. 

As some of you may know, I grew up in Liberty City. I was born 

in Overtown, and I was raised in Liberty City. We were among the 

first black families to own a home. Our family was very fortunate 

because my father was both a small business owner and a small 

business employer. Although we maybe had advantages, we were 

very much aware of how little other people had, and my parents 

never passed up an opportunity to help someone in need. 

During the recent government shutdown President Trump said— 

he made a very insensitive comment in which he suggested that 

furloughed workers who have difficulty buying food, they should 

make an arrangement with their local grocer. That doesn’t work 

today, but that’s how things used to work. I’m sure some of you reLAP51NQ082 with DISTILLER

15 

member that back in the day if you went to the grocery store and 

you didn’t have the money, Chairman Edmonson, you could say to 

the grocer, well, we don’t have the money, but we’ll come back and 

pay you later. 

So decades later there are still many, many people in this community who are greatly in need of assistance in being safe and 

keeping a clean roof above their family’s head, having a job, and 

putting food on their tables. Public housing residents are particularly vulnerable, which is why I have introduced in the House legislation to increase and enhance security provisions in public housing, and another bill requiring comfortable and safe temperature 

levels in Federal-assisted housing. Senator Rubio has introduced 

companion bills in the Senate. 

But a very big part of living with dignity is having a job. If you 

don’t have a job, you don’t have dignity, and that’s what’s wrong 

with so many people in our community, especially men of color. 

There are Liberty Cities in just about every State where month 

after month, and sometimes for years, seeking employment has become a full-time job, always trying to make enough money so you 

won’t have to work three jobs or to just keep food on the table. 

Since my first day in Congress, my mantra has been ‘‘jobs, jobs, 

jobs.’’ I’ve introduced several bills to increase employment. In fact, 

today I’m co-hosting a Jobs and Career Fair in Miami Gardens that 

I hope will result in a lot of job offers to people in that area, and 

I hope that many people will be hired who have been looking for 

a job for a long time. 

So I’m very intrigued by the potential of the economic zones program that will bring jobs to this area that for too long has experienced high poverty and sluggish job and business growth. It also 

would mandate property owners to make improvements that will in 

turn attract new home and business owners, and we hope lots of 

new jobs. In theory, it sounds like a win-win situation. 

Spurring Business in Communities 2018, which was signed into 

law in December, the Safe Temperature Act, and the Liberty City 

Rising Act. 

Now, Liberty City has gained a reputation for high levels of poverty and high crime rates. According to 2014 data from a report of 

the Miami-Dade Economic Advisory Trust and National Liberty 

University, the Liberty City neighborhood has an unemployment 

rate of 25 percent, a poverty rate of 27 percent, a high school graduation rate of 82 percent, and a violent crime rate of 25 crimes per 

1,000 people. 

It wasn’t always like this. The neighborhood that was created in 

1937 aimed to relieve overcrowding and decrepit living conditions 

for African-American families living in what was called the 

Overtown neighborhood. Liberty Square housing project was one of 

the first housing projects in the Nation and is the oldest housing 

project in Miami-Dade County. From the 1930s to the 1950s, the 

neighborhood was seen as the ideal housing project, with a low 

crime rate and people of various income levels living around the 

project. 

In the 1960s and 1970s, absent affordable housing in the neighborhood, some claim that led to deteriorating conditions. In 1980, 

the neighborhood was the epicenter of a three-day riot after the acLAP51NQ082 with DISTILLER

16 

quittal of police officers accused of beating a resident to death, and 

Liberty City never came back after that. Attempts to spur business 

development have been largely unsuccessful, and struggling schools 

have been found to be a major problem for the community. The 

$307 million redevelopment of Liberty Square began last year. All 

units will be demolished in phases, and 400 mixed-income condos 

will be constructed within approximately five years. 

I represent this community, and my district staff meets at least 

once per month with residents and has been very engaged in the 

Liberty City Rising project. Our concern is that as these improvements are being made, they will be pushed out, and I get that. 

Gentrification is a very real fear of low-income people, and there 

are cities all around the Nation that are prime examples of how it 

can push people out of their homes and communities. Because 

these are uncharted waters, I want to learn more about what successful models investors will follow that will mutually benefit them 

and the people of this community, because we want Liberty City 

to come back. 

Has any research been done to determine what kinds of businesses have the best chances of succeeding in a community like 

this? Have job creation benchmarks been set? Is helping local residents start small businesses an option? 

I look forward to hearing your perspectives today and hope that 

these and other questions will be answered. And just keep in mind, 

we all want Liberty City to come back. Thank you. 

[Applause.] 

I want to shout out to Mr. George Ray. 

Stand up, George. 

George is a product of the 5,000 Gold Bottles of Excellence 

Project. Wherever I go, he’s there, and he likes me to introduce 

him. 

[Laughter.] 

Chairman RUBIO. Congressman Wilson, I remember when it was 

500. It went from 500 to 5,000, and maybe it will be 50,000. 

So, how long will you be able to stay with us? A little bit? Are 

you going to be able to stay with us a little bit before you have to 

go to the job fair? 

Ms. WILSON. I’m going to stay as long as I can. 

Chairman RUBIO. Okay. And as we get to our witnesses on the 

second panel, if you have any questions, just come on up. We’d like 

to have any input that you have on that, as well. 

All right. So we’re going to introduce our panel now, our second 

panel, who are going to talk a lot about some of these issues. 

Before you arrived, I pointed out that the goal here is not just 

to redevelop. We can redevelop our community, you can attract investment, but we want to do it in a way where the families that 

are already here can stay, so their kids when they graduate from 

college don’t have to move to Atlanta or move to Chicago or move 

to Washington in order to have opportunity. They may choose to 

do so, but it’s because they chose to, not because they have to. We 

want to figure out how that investment can be geared at rebuilding 

and not transforming it in a way that people have to leave, and 

that’s been a challenge. 

LAP51NQ082 with DISTILLER

17 

Redevelopment largely in the country has meant the people who 

are there have to go because we’re going to put some expensive 

condominiums in, and so forth. So we do want to focus on that, and 

I’m really happy that you mentioned something that I touched on 

but didn’t get into the detail you did, and that is that it wasn’t always this way. And the same could be said for Overtown, by the 

way. These were thriving communities that were in many ways 

models of extraordinary success, and there are people still around 

today that remember that time and that were key instruments of 

it, and your own family’s experience of owning a small business— 

I don’t know all the details of it, but I guarantee that your customers and many of the employees were from the community. 

So small business was rooted in the community, not just located 

in the community. There’s a difference between being rooted in a 

community and located in a community, and that’s what we’re hoping to achieve. 

Our second panel has four really great witnesses, and we thank 

them all for being here today. I think we should start first with Dr. 

Bendross-Mindingall, who serves on the Miami-Dade School Board 

and is, again, someone who I’ve worked with for a long time as 

well. She’s been a strong voice on these issues for a very long time, 

and her experience on this topic as both an educator and now as 

an elected official, first at the State level and now on the school 

board, is going to provide an incredibly helpful background in the 

community and what makes it unique, and something I know is 

very close to Congressman Wilson’s heart and her heart is the 

number of successful young men and women who, once they completed their degrees, even advanced degrees, they have to move 

somewhere else, not even out of Liberty City but out of MiamiDade County, in order to find opportunities. We can’t rebuild our 

communities if we can’t keep our talented young men and women 

and have opportunities for them to be here. 

So as I said, I’m glad you’re here, and we really look forward to 

your testimony. 

STATEMENT OF DOROTHY BENDROSS-MINDINGALL, SCHOOL 

BOARD MEMBER, MIAMI–DADE COUNTY SCHOOL BOARD 

Dr. BENDROSS-MINDINGALL. Good morning, everyone. I’m delighted to be here. I am so proud of Senator Marco Rubio. As he 

said, I worked with him on issues to make sure that our children 

and families do better, and we’ve been creeping along. 

Marco, I don’t know why I’m sitting here because there are others who could tell this story, but I’m just happy that someone saw 

the name and said Dr. Christian will be sitting on the front row, 

and Dorothy needs to speak, because that was not always the case. 

So we’re just going to move along with knowing that in Liberty 

City we welcome all people. 

But as you said earlier, we don’t want to be pushed out. Part of 

what I will tell you is that I grew up in Liberty Square housing 

projects. I spent 15 years of my life there, and that’s why I am the 

person that I am today, because there were those there—I’m going 

to do my best to stick to the script, but it’s hard, it’s very hard. 

So there were those there who did not look at the zip code and, 

of course, told us that we are the very best. We went to the high 

LAP51NQ082 with DISTILLER

18 

schools. We went to the elementary schools. As you said, some of 

us came back. It’s not because we didn’t have other places to go, 

but there is so much more to be done, and we will continue to 

work, and we will work with everyone to get it done. 

I think that I should talk a little bit about how I got to where 

I am. I started that, but I want you to know that I’m one of seven 

children, the first in my family to go to college. Why? Because I 

had older brothers, and they followed my life closely, and as my 

parents said in the kitchen, in Liberty Square housing projects 

having the best breakfast in the world, because my mom was probably one of the best cooks ever, and one of my brothers, Deacon 

James Bendross, told them she’s too smart not to go to college. 

Well, my daddy was doing construction work, and I heard him 

say to my mom, ‘‘How is she going to go?’’ So my brother said, well, 

if we can all pull out of this house in the morning, she will go. And 

they trusted to send me to a private college. I was a little girl on 

welfare, and I didn’t know I was on welfare, Senator, until I got 

to college, because the best days of my life were in Liberty Square 

housing projects. That’s why I visit 6312 NW 14th Court, Unit 115 

every year. It doesn’t look the way it used to, and I’ve been concerned about that for a long time. 

I spoke with Director Liu, and he was coming to the school 

board, and we were having great conversations. But for some reason, the story that I’m telling today was not allowed to be entered 

in any meeting. Very, very concerned. I didn’t call you because 

when things get a little tough, you know I’ll call you. But I had no 

idea that I’d be sitting here, as I said earlier. 

In my life I’ve been evicted twice; gentrification. And I see, I 

guess you would say, generation three back there somewhere. We 

were evicted from colored addition—not ‘‘edition,’’ ‘‘addition.’’ And 

then from there we went to Liberty Square because we didn’t have 

anywhere else to go, but I didn’t know it was going to be the best 

years of my life. 

And my dad, who was doing construction work—they built Liberty City [inaudible] some of the hotels on the beach that we could 

not enter. So the story started back in, as I said, railroad shop colored addition, where we were put out of our houses in the rain, 35 

families, all off [inaudible] again, Mr. Senator. 

But I’m telling you, my heart breaks when I go by some places 

knowing that the treatment is still there. I don’t know all that is 

happening in Liberty Square because, as I said to you at the start, 

I was trying to keep up by being a school board member, trying to 

educate children. I could not keep up, and I don’t know whether 

that was by design or what, but I’m going to do my best to get back 

involved in what is happening there. 

From the time I went to college and became a teacher, and then 

from a teacher to a reading specialist, then to an administrator, 

then to a principal, and met you in Tallahassee on the school 

board, that’s not the story of most people who lived in Liberty 

Square. It just isn’t. 

So I want you to know that I’m working very, very, very hard 

to do my due diligence with the circle of brotherhood who thought 

it not robbery to name the former Floral Heights Elementary 

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19 

School in my honor, the Dr. Dorothy Bendross-Mindingall Socioeconomic Institute, doing a great job, but that’s not enough. 

Again, as you said earlier, jobs. My dad would always say to us 

when we started our careers, get up in the morning and act as if 

you will not have a job, so go in there and do your very, very, very 

best, otherwise you won’t. 

I’m very, very, very, very happy to let you know that without 

what we’re doing today, a lot of people in this room will not know 

it, a lot of people don’t know that we are here. So my goal is to 

meet with some of the people who have struggled and made sure 

that the word got out that we are doing something in Liberty 

Square. I don’t know all that we’re doing in Liberty Square, as I 

said earlier. 

We’ve got to keep up with what’s going on there because the people—and I wrote down the note. You said that we want to do what 

we can for our communities, but we do not want the people that 

are there not to participate and not to have homes, not to be able 

to go to stores. 

It was a thriving community. We didn’t have to leave for anything. Liberty Square is just what it says, it’s a square. We walked 

across the street to our stores, and they were owned by people of 

color, to our restaurants. We even had what was called a little 

night club scene. I couldn’t go because I was a little too little for 

that. 

[Laughter.] 

But 15th Avenue was the place. When I ran my election last August I was asked over and over, are you crazy? Have you lost your 

mind? Why are you setting up a campaign office there? To give people jobs. 

I want you to know that I’m going to follow this. Please do what 

you did in Tallahassee for MCI. If it were not for you and your telling others, whatever Dorothy wants for that community, you give 

it to her—Marco, we’re working very, very hard. The Chairwoman 

can attest to this. That was supposed to do more than it did, but 

we’re going to do our best to move forward with MCI. 

Thank you again. No, I didn’t stay on the script, but I tried to. 

Well, no, I didn’t try to. 

[Laughter.] 

Thank you so much for the time. God bless. 

[Applause.] 

Chairman RUBIO. Well, we’re going to hear now from Director 

Liu, who directs the Miami-Dade County Public Housing and the 

work at Liberty Square. 

We thank you for coming. We want to hear that update and see 

how that fits into [inaudible]. 

STATEMENT OF MICHAEL LIU, EXECUTIVE DIRECTOR, MIAMIDADE COUNTY DEPARTMENT OF PUBLIC HOUSING AND 

COMMUNITY DEVELOPMENT 

Mr. LIU. Thank you very much, Mr. Chairman. It’s an honor to 

be here, and a special thank you for those visits. 

Chairman RUBIO. Do you want to pull that mic closer? 

LAP51NQ082 with DISTILLER

20 

Mr. LIU. I want to say thank you for the visits, and I want to 

underscore the ‘‘s,’’ plural, the visits that you have made to Liberty 

Square and Liberty City to assess what is going on in reality. 

As Director of Miami-Dade County’s Department of Public Housing and Community Development, I have followed the direction of 

Mayor Carlos Gimenez and the Board of County Commissioners, 

the Chairwoman and District 3 Commissioner, Audrey Edmonson, 

in the vanguard of managing the Liberty City Rising initiative, and 

in particular the component of the effort that encompasses the redevelopment of the Liberty Square public housing. 

Liberty City Rising, announced in early 2015, as previously mentioned and referenced by Chairwoman Edmonson, is not just about 

public housing. Liberty City Rising comes with a financial commitment by the county of over $74 million, $46 million in base financing for Liberty Square, which has resulted in a redevelopment 

project that’s going to cost at the end of the day over $350 million, 

which is a leveraging factor of about seven to one; and in addition, 

$28 million in economic development and other non-public housing 

in Liberty City. 

Indeed, Liberty City has great potential to become a vital part 

of the county’s growth and strength in the future. With a population of approximately 50,000 persons and 15,500 households, Liberty City, if it were a formal city, would be the seventh largest in 

the county. Economists have said this ‘‘market area’’ to reach over 

500,000 persons with an aggregate household income for the market area of over $5 billion. 

Chairman RUBIO. I think they’re saying they can’t hear you in 

the back. 

Mr. LIU. Over $5 billion, which represents significant purchasing 

power. It should be of particular interest to the committee that of 

the total number of businesses in Liberty City, 1,599, 92 percent 

of them employ less than 20 people, and 94 percent are single-location businesses, small businesses. 

Hence, it makes economic sense to allocate resources that will 

support area small businesses and provide education and job training options to assist Liberty City residents and businesses to link 

up and maximize job opportunities for Liberty City residents. This 

is a direction that the county is embracing as it proceeds with the 

Liberty Square redevelopment component of Liberty City Rising. 

Our private-sector partner in the project is obligated—this is not 

aspirational—is obligated to provide 20 percent of the 1,158 projected construction jobs to HUD Section 3, that is public housing 

and lower-income residents of Miami-Dade County, and 75 percent 

of the approximately 257 post-construction jobs to Section 3 residents of the county. Priority is given to the residents from area zip 

codes of 33142 and 33147. In addition, 50 percent of all subcontracts, with an estimated value of $90 million, must be awarded 

to Section 3 small businesses, minority-owned businesses, and 

women-owned business enterprises. 

As of today, as we move through Phase I of the project, $50 million of the total development costs of that first phase, $25.5 million, 

has gone to small businesses. That’s 59 percent of the subcontracts 

of that total development cost. 

LAP51NQ082 with DISTILLER

21 

To date, there have been over 13 subcontractors that have been 

awarded contracts to Phase I, Section 3 small businesses, and there 

have been—beginning this summer there are 42, but as of today 

there are 105 jobs that have been captured, that have been hired 

by Section 3 qualified workers, and another 93 of them come from 

33142 and 33147 zip codes. 

Employ Miami-Dade has been a key component of this. Employ 

Miami-Dade brings together Career Source of South Florida, which 

is the business and operational entity for the South Florida Workforce Investment Board, created pursuant to the Federal Workforce 

Innovation and Opportunity Act, Miami-Dade College, and county 

and private-sector interests. By the time the backhoes and shovels 

are in the ground, there were Employ Miami-Dade trade workers 

with skills that could be considered for hiring. 

The construction firms doing the work in Phase I could not and 

cannot plead that there are no qualified Section 3 workers to be 

hired, and that’s a huge difference here that the direction of Chairwoman Edmonson and Mayor Gimenez made a requirement, that 

Section 3 hiring of low-income residents would be a requirement, 

not just to the extent feasible, which is the HUD regulation, which 

has been a huge loophole in Federal policy for the 34 years that 

Section 3 ‘‘requirements’’ have been in place. Federal law does not 

really require it, it just says ‘‘to the extent feasible.’’ 

We have gone a step further in Miami-Dade County. We have 

made it a contractual requirement under penalties of not meeting 

those requirements to, in fact, make those hires real. 

In addition, as again referenced by Chairwoman Edmonson, the 

project by contract, under threat of penalties, will have 15,000 

square feet of retail commercial space along NW 15th Avenue specifically set aside for mom and pop small businesses. 

Phase I of Liberty Square is well underway, and the first two 

buildings are on target to be completed by the end of this first 

quarter of this calendar year. Mr. Chairman, we’ll make sure that 

you and all of your committee members get invitations to come to 

the grand opening there. 

Phase II is ready to close. All of our documents on our end are 

ready to go, and we’re planning on closing in February. We’re just 

hoping that HUD will be able to catch up after this Federal shutdown. We’ve been in communication with them, and we hope that 

we can make that happen. 

You picked a very auspicious day to have this hearing, because 

beginning today, actual assignments of units in Phase I are being 

made to the residents who will temporarily transfer to units on 

site, so there is no displacement, units on site, and they will see 

and get to pick the units that they will be moving into in Phase 

I. 

Finally, we are hopeful, as you have mentioned, sir, that the new 

Opportunity Zone Program contained in the Tax Cuts and Jobs Act 

will be an added incentive for private-sector investment in this 

area. It was included in the Governor’s designation of Florida Opportunity Zones, and we have been reaching out to a number of 

funds that are in the process of being formed and educating them 

on what has happened in this community. 

LAP51NQ082 with DISTILLER

22 

Liberty City is really happening. The attention to this community by the United States Senate and your committee could not 

have come at a better time. Any resources that the Federal Government can set aside for Liberty City to help in its economic revitalization I assure you will not be wasted, and I pledge that my department, under the direction of the county, will assist in 

leveraging those resources to the maximum extent possible. We 

know how to make use of those resources and how to engage the 

private sector at the local level here. 

Thank you for giving me the opportunity to participate on this 

panel, sir. 

[The prepared statement of Mr. Liu follows:] 

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23 

LAP51NQ082 with DISTILLER


Insert offset folio 1 here 35697.001

Michael Liu, Director 

Public Housing and Community Development 

701 NW 1st Court. 16th Floor 

Miami, FL 33136-3914 

T 786-469-4100 • F 766-469-4199 

miamldade.gov 

Miami-Dade County Dept. of Public Housing and Community Development 

February 1, 2019 

Testimony on "Uberty City Rising: Achieving Upward Mobility through Small Business 

and Community Partnerships" 

Senator Rubio, Chairman of today's hearing of the Senate Committee on Small Business 

and Entrepreneurship, and favorite son of South Florida, it is an honor to have you here. 

And Mr. Chairman, a special thank you for your visits to Liberty Square and for providing 

the leadership to hold this field hearing. 

As Director of Miami-Dade County's Dept. of Public Housing and Community 

Development, I have followed the direction of County Mayor Carlos Gimenez and the 

Board of County Commissioners with Chairwoman and County District 3 Commissioner 

Audrey Edmonson in the vanguard, in managing the "liberty City Rising" initiative, and in 

particular the component of the effort that encompasses the redevelopment of liberty 

Square public housing. 

However, liberty City Rising, announced in early 2015, is not just about public housing. 

Liberty City Rising comes with a financial commitment by the County of over $74 million: 

$46 million in base financing for Liberty Square (which has resulted in a redevelopment 

project that is attracting over $320 million in private sector and other public investment, 

a leverage factor of 7); but also $28 million for economic development and other nonpublic housing purposes in Liberty City. 

Indeed, Liberty City has great potential to become a vital part of the County's growth and 

strength in the future. With a population of approximately 50,000 persons, and 15,500 

households, Liberty City if it were a formal city would be the 71

h largest in the County. 

Economists have pegged its "market area" to reach over 500,000 persons with an 

aggregate household income for the market area of over $5 billion which represents 

significant purchasing power. 
24 

LAP51NQ082 with DISTILLER


Insert offset folio 2 here 35697.002

Page2 

It should be of particular interest to this Committee, that of the total number of 

businesses in Liberty City--1,599, 92% of them employ less than 20 people and 94% are 

single location businesses. 

Hence, it makes economic sense to allocate resources that will support area small 

business and provide education and job training options to assist Liberty City residents 

and businesses to link up and maximize job opportunities for Liberty City residents. 

This is a direction that the County is embracing as it proceeds with the liberty Square 

redevelopment component of Liberty City Rising. Our private sector partner in the 

project, Related Urban Development Group, is obligated to provide 20% or 1,158 of 

projected construction jobs to HUD Section 3 (i.e., public housing or low income) residents 

of Miami-Dade County, and 75% or approximately 267 of post construction jobs to Section 

3 residents of the County. Priority is given to residents from the area zip codes of 33142 

and 33147. In addition, 50% of all sub-contracts, with an estimated value of $90 million, 

must be awarded to Section 3, Small Business, Minority-Owned Business, and WomenOwned Business Enterprises. 

To date, 13 subcontracts that have been awarded for the 214-unit Phase 1 of the project 

have been to Section 3 and small businesses, 42 jobs have gone to Section 3 qualified 

workers, and 93 jobs are being held by workers who reside in the 33142 and 33147 zip 

codes. Key to the success in hiring has been the County's coordinated job training effort 

called Employ Miami-Dade which initially targeted residents of 33142 and 33147 and 

began in 2015. This brings together CareerSource South Florida (the business and 

operational entity for the South Florida Workforce Investment Board created pursuant to 

the federal Workforce Innovation and Opportunity Act), Miami-Dade College, the County, 

and private sector interests. By the time the backhoes and shovels were in the ground, 

there were Employ Miami-Dade trained workers with skills that could be considered for 

hiring. The construction firms doing the work at Liberty Square Phase 1, could not and 

cannot plead that there are no qualified "Section 3" workers to be hired. 

In addition, by contract with the county, the project will have 15,000 square feet of 

retail/commercial space along NW 151

h Avenue specifically set aside for "mom and pop" 

enterprises. 

Phase 1 of Liberty Square is well underway, and the first two buildings are on target to be 

completed by the end of this first quarter of this calendar year. (Mr. Chairman, we will 
25 

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Insert offset folio 3 here 35697.003

Page3 

make sure that all Committee members get invitations to tour the finished product.) All 

documents on our end are ready for a planned closing on financing on Phase 2, and we 

await to hear from HUD on whether it will be able to make things happen on its end. 

Finally, we are hopeful that the new Opportunity Zone program contained in the Tax Cuts 

and Jobs Act passed by the Congress and signed into law by the President will be an added 

incentive for private sector investment in Liberty City, which was included in the 

Governor's designation of Florida Opportunity Zones. We have been reaching out to a 

number of funds that are in the process of being formed or which have been formed, 

educating them on Opportunity Zones in Miami-Dade County. 

Liberty City really is "happening." The attention to this community by the United States 

Senate and this Committee could not have come at a better time. Any resource that the 

federal government can set-aside for liberty City to help in its economic revitalization will 

not be wasted, and I pledge that my Department will do all it can to assist in leveraging 

that resource to the maximum extent possible. We know how to make use of those 

resources and how to engage the private sector in doing so. 

Thank you for inviting me to participate on this panel, and I am open to answer any 

questions you may have. 
26 

Chairman RUBIO. Thank you so much. I appreciate it. 

Now we’re going to hear from Brian Van Hook, the Associate Regional Director of the Small Business Development Center, and I 

believe a former staffer of this committee at one time. 

Mr. VAN HOOK. Yes, sir. It’s a little weird to be on this side of 

the witness table. 

Chairman RUBIO. So, there’s life after the Senate. 

[Laughter.] 

We’re interested to hear from you about the services that you 

provide to small business, helping them to gain access not only to 

SBA programs but other programs that are available. Thank you 

for being here. 

STATEMENT OF BRIAN VAN HOOK, ASSOCIATE DIRECTOR, 

FLORIDA SBDC AT FLORIDA INTERNATIONAL UNIVERSITY 

Mr. VAN HOOK. Thank you, Chairman Rubio, and thank you for 

the opportunity to appear before the committee today. 

As you mentioned, I’m a former staffer of the committee, so it’s 

extra special for me that your first field hearing is here in Miami, 

here in Liberty City. 

Chairman RUBIO. My first hearing, period. 

Mr. VAN HOOK. Your first hearing, wow. 

Chairman RUBIO. I can’t lose the gavel. We’ve got to take this 

back. 

[Laughter.] 

Mr. VAN HOOK. It’s a pretty cool gavel. 

But I know the amount of time that you have to spend in terms 

of putting these field hearings together, and I know, as you said, 

this is your opportunity to bring Washington to the community. So 

I know it’s very important, and I think it’s very important that 

you’re holding it here in Liberty City. 

As you mentioned, my name is Brian Van Hook. I’m Associate 

Director of the Florida Small Business Development Center at FIU. 

Our center is a Small Business Administration, SBA, resource partner, and we’re focused on helping businesses in Miami-Dade County grow and succeed. It’s a really great job. It’s not a tough sell that 

we basically say, hey, we want to help you start a business, we 

want to help you grow a business. Actually, we did such a good job 

here in Miami-Dade County that they also let us expand to Monroe 

County as well. So we have the tough job to say, hey, we’re going 

to help businesses in Miami, but also we get to go to the Keys and 

help businesses to grow down there as well, so it’s a really tough 

job. 

But we help these businesses through our dedicated team of 17 

experienced experts. They’re not jack-of-all-trades/master of none. 

They’re all specialists in a particular area. And since Congresswoman Wilson recognized George Rain III, I’d ask him to stand up 

again for a second shout out because he’s one of our business consultants. Each of these, as I said—— 

Chairman RUBIO. Is he in charge of the keys? 

Mr. VAN HOOK. No. 

[Laughter.] 

He does have a couple of clients down there, though. I don’t know 

how he worked it, but he got a couple of clients down there. 

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27 

But they’re each a specialist in a specific area, and they work 

one-on-one with the business owners in access to capital, government contracting, international trade, HR, business plans. This 

consulting is confidential and it’s provided at no cost to the business owner. 

Overall, our center works with approximately 900 business owners a year. Actually, one of these clients that I’m proud to talk 

about is Ed Haynes. 

Ed, can you stand up? I didn’t recognize you because you didn’t 

have your security outfit on. You’re dressed to impress. 

But Ed Haynes is the founder of Haynes Security Services. He’s 

been in law enforcement for more than 30 years. He served in the 

United States Marine Corps, and he was also the first black police 

officer in the Village of Miami Shores. Actually, Ed started his 

business in 2011 right near here in Liberty City, and his first client 

was Congressman Wilson. He has kind of grown since then, and 

basically Haynes Security Service has expanded to provide security 

for real estate development companies at events, and also MiamiDade Metrorail. Our center worked with Ed in terms of maintaining existing contracts that he had, and also securing the capital to 

go after new contracts. 

In particular, our team worked with him to prepare financial documents and also find the right lender. The result was a $50,000 

loan from the Miami Bayside Foundation for equipment and working capital to help with payroll costs, and this has allowed Ed to 

grow his company from eight employees in 2015 to more than 35 

today. Our center has continued to work with Ed—I don’t let him 

off the hook now that he’s going after larger contracts and larger 

projects. 

Now that we’ve talked about Ed, one of the great clients we work 

with, let’s focus on what’s going on here in Liberty City. As you 

guys mentioned, the Liberty City Square project is one of the largest affordable housing projects in the country. It’s almost $300 million total. The redevelopment promises new opportunities for families, for the community as a whole and, as we’re here to discuss, 

local small businesses. 

It’s my understanding that, as Director Liu mentioned, the developer has committed to create small business programs for construction and goods and services for the project. There’s a commitment 

to provide contracts to Section 3 small business enterprises, minority business enterprises, and women-owned business enterprises. 

But with any redevelopment project this size, it’s common for larger out-of-state firms to come in and compete to be part of this 

project, and a lot of times also there’s a local preference office that’s 

set up to kind of filter the local small businesses, but a lot of times 

those LPOs, businesses don’t get much farther from that. 

So you see a lot of also national restaurants and retail establishments that come in to set up shop in the community. As Chairman 

Rubio mentioned, it’s important to not lose sight of the successful 

locally grown anchor businesses that have been here and that are 

committed to being here for the long term. 

In terms of the challenges that these businesses face when 

they’re bidding on these contracts and winning them, access to capital, as the Chairman mentioned, is a major issue. As businesses 

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28 

grow and compete for larger contracts, they often struggle to maintain the cash flow necessary to service the contract, and that’s actually where groups like SBDC come in. 

We work with business owners to improve their financial management. It’s a better budget for expected growth. Otherwise successful businesses, they struggle because they have those standard 

30-day, 60-day, 90-day delays from when you do the work and it’s 

completed until you get paid. So access to capital is a necessity, not 

just for these contractors but also for businesses in the community 

that are looking to grow. 

So for our center’s purposes, we cast a wide net when we’re helping local small businesses obtain capital. We basically want to help 

people access loans, but also equity investors or other types of financing as well. We want as many tools in our toolbox as we can 

get. So for that reason, we appreciate the attention that you put 

on the SBA’s SBIC program. It’s my understanding that the original intent behind that program was to address gaps in long-term 

funding for scalable, growth-focused small businesses. But actually 

today, Chairman Rubio, if you go to the SBIC website on the SBA’s 

website, they list, as you mentioned, seven SBICs in Florida. Of 

those seven, three are listed as likely not still investing. And two 

of the ones that are likely not investing are here in Miami. They’re 

actually right down the street from my office. 

So to better help those small businesses grow, it’s important, as 

I said, to have as many tools in the toolbox as possible. That’s because, depending on the business size, the business stage, the expected use of the funds and industry, suitable financing options are 

going to differ from business to business. Therefore, we encourage 

opportunities such as your legislation that is going to increase the 

pool of capital that’s available to grow Miami-Dade and Liberty 

City’s small businesses. 

In closing, I just want to thank you again for the invitation to 

speak today. It’s our hope that this field hearing is going to ensure 

that development here in Liberty City is going to create opportunities for local small businesses, as well as jobs for the community. 

And for SBDC’s part, we’re looking forward to any collaborations 

that come out of this hearing or any of the groups that we can 

work with. I actually see Jordan from Legal Services Miami, and 

we’ve actually been working with them on an Opportunity Zone 

Working Group to try to find businesses that are in the Opportunity Zone so that we can market them and hopefully get investors. 

Thanks again for your time. 

[The prepared statement of Mr. Van Hook follows:] 

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Testimony of 

Brian Van Hook 

Associate Director 

Florida SBDC at Florida International University 

United States Committee on Small Business and Entrepreneurship 

"Liberty City Rising: Achieving Upward Mobility through Small 

Business and Community Partnerships" 

February 1, 2019 
30 

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"Liberty City Rising: Achieving Upward Mobility through 

Small Business and Community Partnerships" 

February 1, 2019 

Prepared Testimony of 

Brian Van Hook, Associate Director, Florida SBDC at FlU 

Chainnan Rubio, thank you for chairing this hearing and for the opportunity to appear before the committee 

today. I appreciate your and the Committee's attention to small businesses in Miami-Dade County, 

particularly those here in Liberty City. 

My name is Brian Van Hook and I am Associate Director of the Florida Small Business Development 

Center (SBDC) at Florida International University (FlU). Our center is a U.S. Small Business 

Administration (SBA) resource partner focused on helping grow businesses in Miami-Dade County. 

Recently, we also expanded our service area to cover Monroe County as well. 

In particular, our dedicated team of seventeen experienced experts provides quality one-on-one business 

consulting to entrepreneurs and business owners in order to help them grow and succeed. This consulting 

is confidential and is provided at no cost to the business owner. Areas of assistance include: Access to 

capital; financial management; business plan assistance; growth strategies; startup assistance; operations 

management; data/research; human resources; procurement assistance; international trade and more. 

Our center works with more than 900 entrepreneurs a year and does not take for granted that we are able to 

do so because of support from the Federal government and the State of Florida, along with private sector 

and foundation partners. As such, we are laser focused on tracking our client outcomes, as required hy 

Congress and the SBA. This helps us ensure that we are providing a positive return on investment for the 

taxpayer. The best part: the impact is counted and attributed to our center onlv if it is verified by our clients. 

One reason we love our jobs is that, for our center to be successful and to achieve goals, we need to generate 

tangible successes and outcomes for our small-business clients. When we help generate additional sales for 

a local business that often translates to more money in the pockets of a local family. When we help a 

business secure capital to expand, that often means they hire additional workers or invest in the local 

community. And every business successfully launched creates opportunities for other businesses, funders 

and the local community. 

With that in mind, I am proud to report that since 2014, our consulting team has worked with more than 

2,800 Miami-Dade County businesses to: 

Generate more than $1.07 billion in additional sales 

Access more than $121.3 million in business capital (loans and equity investments) 

Create, retain or save more than 9,990 jobs 

Launch more than 14 7 new businesses; and 

Train more than 2,697 entrepreneurs and business owners via events with Florida SBDC at FlU 

and our sister center, FlU's Pino Global Entrepreneurship Center 

Additionally, with regard to government contracting, we work with a Florida Procurement Technical 

Assistance Center (PTA C) specialist. This program is funded in part through a cooperative agreement with 

the U.S Department of Defense's Defense Logistics Agency. Our partner PT AC Specialist helps businesses 

obtain registrations and certifications, prepare bids, and even match them with contracting opportunities 

trom agencies that buy goods and services. Since 2014, our PTAC Specialist and the rest of our 
31 

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SBDC consulting team helped local businesses secure more than $45.7 million in federal, state and local 

contracts. 

One of these clients is Ed Haynes, founder of Haynes Security Services. Ed has been in law enforcement 

for more than 30 years. He served in the U.S. Marine Corps and was the Jirst black police officer in the 

Village of Miami Shores. 

Ed Haynes started the business in 2011 near Liberty City and his Congressional representative was one of 

his first clients. Haynes Security Services has since expanded to provide security for real estate development 

companies, at events and the Miami-Dade Metrorail. The company also trains guards to obtain the 

appropriate licenses and certifications. In 2017, llaynes Security Services received both the SBA South 

Florida District Office and State of Florida Veteran-Owned Business of the Year awards from the SBA. 

Florida SBDC at FlU assisted Haynes Security Services with maintaining existing contracts and securing 

necessary capital to go after new contracts. In particular, our team worked with the company to prepare 

financial documents and find the right lender. The result was a $50,000 loan from the Miami Bayside 

Foundation for equipment and working capital to help with payroll costs. This has allowed Ed to grow his 

company from 8 employees in 20 15 to more than 3 5 today. 

Ed is proud to remind you that he has the awesome responsibility of providing for more than 30 families, 

including his own. Two of his daughters work in the business and his wife is the Chief Financial Officer. 

Our center has continued to work with the company as they grow and pursue larger contracts. 

Now that you have some background on our center and learned about one of our great clients, I would like 

to discuss the redevelopment that is occurring here in Liberty City. As you know, the Liberty Square project 

is one of the largest affordable housing projects in the country - almost $300 million in total. The 

redevelopment promises new opportunities for families, the community as a whole, and, as we are here to 

discuss, local small businesses. 

It is my understanding that the developer, Related Urban Development Group, committed to create a small 

business program for all construction, goods, and services related to the project. There also was a 

commitment to provide contracts to Section 3, Small Business Enterprises (SBEs), Minority Business 

Enterprises (MBEs), and Women-Owned Business Enterprises (WBEs). 

With redevelopment projects of this size, it is common tor larger out-of-state firms to come in to compete 

to be part of the project. You also see national restaurant and retail establishments come in to set up shop 

in the community. It is important to not lose sight of the successful, locally grown businesses that have been 

here and are committed to be here for the long term. These anchor businesses can play a vital role in the 

community's growth. 

For this reason, I look forward to the testimony of other witnesses at today's hearing for an update on 

progress made toward these small business goals. There are countless businesses in this community, 

including a number of our SBDC at FlU clients, which are qualified tor the work and would love to 

participate in the project. 

In terms of challenges that these businesses face in bidding on and winning contracts, access to capital is a 

major issue. As businesses grow and compete for larger contracts, they often struggle to maintain the cash 

flow necessary to service the contracts, This is where groups such as SBDC come in. We work with business 

owners to improve their financial management and better budget for expected growth. Furthermore, 

otherwise successful businesses struggle with standard 30, 60, or 90-day delays between when 
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work is completed and when they receive payment. We encourage business owners to focus on building 

their bonding capacity and to remember the best time to get a line of credit is when business is good. Too 

often, business owners don't explore financing options until they are in dire straits or are pressed for time 

with an upcoming contract. 

Access to capital is a necessity not only for contractors but for all businesses seeking to grow. Our center 

casts a wide net when helping our local small businesses obtain capital -by assisting businesses not only 

in obtaining loans but also obtaining equity investors. 

For this reason, we appreciate your attention to the SBA 's Small Business Investment Company (SBIC) 

program. It is my understanding that the original intent behind creating the SBIC program was to address 

gaps in long-term funding for scalable, growth-focused small businesses. As such. many of SBA's great 

success stories such as Apple, FedEx, Callaway Golf and Outback Steakhouse received SBIC funds and 

went on to become the global brands they are today. 

These days, if you visit the SBIC Directory on the SBA website, you'll find it lists seven SBICs in Florida. 

Of those seven, three are listed as "Not Likely Still Investing". Two of the SB!Cs that appear to be inactive 

are from here in Miami. The remaining three SB!Cs that are active are located in Tampa (2) and in Orlando 

(I). 

To better help small businesses grow, it's important to have as many "tools in the toolbox" as possible. That 

is because depending on the business size, business stage, the expected use of funds, and industry, suitable 

financing options will differ from business to business. Therefore, we encourage opportunities to increase 

the pool of capital available to grow Miami-Dade's small businesses. 

In closing, [ know that your committee is not just looking for our perspective but also for available data that 

will help guide redevelopment in this community. It just so happens that our center last summer issued a 

report that gives a snapshot of Miami-Dade businesses. The Florida SBDC at FlU commissioned the report, 

which was produced by the FlU Metropolitan Center. The name of the report is "Small Business. Big 

Impact: Report on Small Businesses in Miami-Dade County 20 18" 

Among the findings of the study: 

81.3 percent of all businesses in the county are micro businesses or companies with fewer than I 0 

employees; 

Miami-Dade had the highest percentage of microbusinesses among six comparison counties 

studied: 

Half of the businesses with only one employee paid an average wage of$24,000 or less; 

For businesses with 2 to 9 employees. half the companies had average wages of$30,667 or less; 

Between 2005 and 2015, the number of non-employer establishments in the Miami-Dade area rose 

55.9 percent, almost three times the national rate 

Along with this written testimony, we have submitted a full copy of the study so that you may review its 

findings in greater detail. 

It is our hope that the hearing today will help ensure that development in Liberty City helps create 

opportunities for local small businesses, as well as jobs for our community. We also look forward to any 

collaborations that our center can foster with groups in attendance. 

[n closing, thank you again Chairman Rubio for the invitation to speak today. As a former staffer of this 

Committee, I am grateful for your time and focus on growing our nation's small businesses. 
33 

Chairman RUBIO. Thank you. The bill that we passed, it’s not a 

law. It’s designed, we hope, to fix that issue with the SBICs, the 

investment companies in Florida. As you said, Florida really only 

has three or four active ones, and they have to be a key cornerstone of driving that investment into the right communities. Florida is the third largest State in the country. It doesn’t make a lot 

of sense that we’re that low on the totem pole. 

Our last testimony on this panel, and then I’m going to have a 

few questions, we’re going to hear from Mary Burke Baker. She 

works as a Government Affairs Counselor at K&L Gates, but she 

has extensive background in tax implementation, with a special 

focus on the newly enacted Opportunity Zone provisions. We kind 

of want to hear how similar provisions have worked in the past and 

how these programs are likely to succeed now, especially given our 

very clear goals here locally. 

STATEMENT OF MARY BURKE BAKER, GOVERNMENT AFFAIRS 

COUNSELOR, K&L GATES LLP, WASHINGTON, DC 

Ms. BAKER. Thank you, Chairman Rubio. Thank you for inviting 

me to testify today about Opportunity Zones. I should note that I’m 

participating in this hearing on my own behalf, and my comments 

are not necessarily reflective of K&L Gates or our clients. 

Chairman RUBIO. The lawyers wrote that. I bet a lawyer wrote 

that. 

[Laughter.] 

It’s like the car advertisement with that little stuff on the bottom. All right, we got it. 

Ms. BAKER. And I have to say that I’ve just been very inspired 

by meeting folks today and listening to the comments and the stories, and I do believe that Opportunity Zones is entirely consistent 

with the goals that are being expressed here today. 

Today is an important step toward ensuring that Liberty City 

and other Opportunity Zone locations in Florida are well positioned 

to reap the considerable advantages of the Opportunity Zone Program, including long-term investment leading to a sustained 

stronger local economy and the creation of well-paying jobs for residents. 

It is important that city officials, economic development advocates, and business and community leaders understand the potential of the program, how it works, and what they can be doing in 

order to maximize OZ benefits for Liberty City. Accordingly, my 

testimony focuses on ways that the OZ program can help Liberty 

City and what champions of the city can do to help attract OZ investment into the area. 

Liberty City’s selection as an Opportunity Zone is significant because it provides Federal tax incentives to investors to make quality, long-term investments in the community. Chairman Rubio 

mentioned that these investments need to occur for at least a 10- 

year period, minimum. These incentives include deferral of income 

taxes on capital gains that are invested in Opportunity Funds that 

must hold at least 90 percent of their assets in new businesses or 

new tangible property physically located in the Opportunity Zones, 

and tax-free treatment of capital gains arising from those investments that are held for at least 10 years. 

LAP51NQ082 with DISTILLER

34 

OZ incentives can reduce the cost of capital for development 

projects, new businesses, and emerging technology initiatives, and 

attract capital to areas that otherwise might be passed by. 

Opportunity Zones have the potential to be a win for everyone 

involved, including the investors, developers, entrepreneurs, but 

most especially and most importantly the communities that can 

benefit from new affordable housing, accessible retail like grocery 

stores, services like daycare and medical clinics, industry and good 

jobs. OZ is particularly effective when paired with other Federal, 

State, and local development incentives. 

It’s important to stress that tax benefits accrue only if the investments are in Opportunity Zone assets and businesses that are substantially located, used, and operated within the Opportunity Zone. 

Businesses must be active trades or businesses of the type that will 

generate economic activity and new jobs. Passive investment activity is outside the scope of the policy and severely curtailed. For example, Opportunity Zones do not permit speculators to buy up and 

sit on land unused for 10 years and then sell it at a profit. The Opportunity Zone incentive is deliberately designed to boost the local 

economy through active investments. 

So what type of investments are we talking about? The OZ incentive can help attract investment dollars for a wide variety of 

projects and businesses. Rehabilitation of outdated or abandoned 

buildings or new construction can provide affordable housing for 

residents. Commercial real estate development can provide accessible and modern space for new enterprises. New and expanding 

businesses, including manufacturing, assembly, warehousing, distribution, retail, restaurants, daycare, start-ups, energy, research 

facilities, medical and other services can provide the base for longterm economic sustainability by offering permanent, well-paying 

jobs within practical commuting distances of current residents in 

the Opportunity Zone, all while improving the quality of day-to-day 

living. 

Further, the ripple effects of stable investment in the city, particularly from related suppliers and service providers, can result. 

How can Liberty City get in on this? The impact of Opportunity 

Zones on any particular area, including Liberty City, is largely dependent on the Opportunity Zone’s ability to attract investment. 

There are no statutory caps or allocations limiting the use or the 

investment in Opportunity Zones. However, there is competition for 

investor dollars in projects among communities as awareness of the 

program and as potential to create substantial economic growth 

and job creation spreads across the country. 

To compete, economic development authorities, government agencies, business associations, and community leaders in urban and 

rural areas throughout the country are taking steps to proactively 

encourage investment in their Opportunity Zones by publicizing 

the program and their community needs and coordinating with investors, developers, and business owners to facilitate the use of Opportunity Zones. 

It’s vitally important that communities like Liberty City understand the OZ incentive and act promptly in order to maximize their 

ability to attract investment and ensure they receive their fair 

share of OZ benefits. 

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35 

Thank you again, Mr. Chairman, for inviting me to participate, 

and I’m happy to take any questions. 

[The prepared statement of Ms. Baker follows:] 

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Mary Burke Baker 

Government Affairs Counselor 

K&L Gates LLP 

Chairman Rubio, 

Thank you for the opportunity to testify at today's hearing about Opportunity Zones. My name 

is Mary Burke Baker, and I am a government affairs counselor in the Washington, D.C. office of 

the international law finn K&L Gates LLP, where I lead the firm's Tax Policy Practice and colead the finn's cross-disciplinary Opportunity Zone initiative ("OZ Team"). Prior to joining 

K&L Gates, I spent six years working on tax issues on the Senate Committee on Finance and 

before that I served at the Internal Revenue Service ("IRS") for over 25 years in a variety of 

technical and senior management roles. 

I am participating in this hearing today on my own behalf and my comments are my own and do 

not necessarily reflect the views of K&L Gates LLP, my colleagues or any firm clients. 

This field hearing is particularly timely as investors, developers and entrepreneurs are making 

decisions about when and where to utilize Opportunity Zone (''OZ") incentives for projects and 

businesses that will provide affordable housing, employment and long-term economic stability 

in disadvantaged communities. The hearing demonstrates the strong commitment of Chairman 

Rubio and other Members of the Committee on both sides of the aisle to facilitate and 

accomplish these fundamental objectives in our nation's low-income urban and rural areas. It is 

important that city officials, local economic development authorities, and business and 

community leaders understand the potential of the program, how it works, and what they can be 

doing in order to maximize OZ benefits for Liberty City, its businesses and its citizens. 

Accordingly, my testimony includes discussion about the OZ program generally and ways that 

the program can help Liberty City specifically to build up the local economy, create jobs and 

improve the quality of life for its residents. My comments are based on the terms of the incentive 

as described in the OZ legislation included as part of the 2017 Tax Cuts and Jobs Act ('TCJA"), 

proposed regulations issued in October, 2018, and the Joint Committee on Taxation's ("JCT") 

Blue Book explanation of the TCJA. Additional proposed regulations and guidance arc expected 

from the U.S. Department of Treasury ("Treasury") and the Internal Revenue Service ("IRS") 

further clarifying the mechanics and implementation of the OZ incentive. 

Since enactment of the OZ incentive, I have seen first-hand the tremendous interest in the 

program across the country. In response to this enthusiasm about OZs, K&L Gates has 

established a cross-practice, multi-office OZ Team to assist clients with the procedural, legal 

and regulatory requirements and questions stemming from the program. Our OZ Team includes 

lawyers from the tax, policy, investment management, private equity, real estate, renewable 

energy, and tax-exempt organizations/nonprofit institutions practices, and is designed to help 

clients understand and engage in the program. 

How Can Opportunity Zones Help Liberty City? 

Liberty City is located in an OZ. Since nominations for OZs were limited by law to only 25 

percent of qualifying low-income census tracts in a state, Florida Governor Rick Scott's 

nomination and Treasury Secretary Stephen Mnuchin's approval of Liberty City as an OZ is 

significant. 

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Mary Burke Baker 

Government Affairs Counselor 

K&L Gates LLP 

The OZ program can help attract investment dollars to Libe1ty City that can be deployed in a 

variety of ways to improve the quality of life for residents, bolster the economy and create wellpayingjobs. Rehabilitation of existing buildings or new construction can provide affordable 

housing for residents. Commercial real estate development can provide accessible and modem 

space for new enterprises. New and expanding businesses- including manufacturing, 

assembly, warehousing, distribution, retail, day care centers, restaurants, start-ups, incubators, 

research facilities, and medical and other services can provide the base for long-term 

economic sustainability by offering permanent, well-paying jobs within practical commuting 

distances of current residents. Further, the ripple efTects of stable housing and new businesses 

and jobs could support additional investment in the city, particularly from related suppliers and 

service providers. 

How Does the Opportunity Zone Incentive Work? 

To maximize the potential ofOZs, it is necessary to understand the incentive and how it works. 

While additional regulations are expected in the near future that will provide more specifics on 

how to maximize OZ benefits, the statute and the initial round of proposed regulations provide a 

solid foundation into the basics of OZ. 

Policy 

OZs were created to incentivize long-term investments to spur economic activity and create jobs 

in low-income areas by offering tax benefits to investors and potentially reducing the cost of 

capital for business owners, developers, innovators and entrepreneurs. Consistent with the 

policy of the incentive, OZ generally requires an investment in new or substantially improved 

property, and OZ assets and businesses are required to be substantially located and used within 

the OZ. Businesses must be active trades or businesses; passive investment activity is outside 

the scope of the policy and is severely curtailed. 

Overview 

Individuals, corporations and many pass-through entities can delay paying federal income tax on 

capital gains until as late as their tax year including December 31, 2026 if those gains are 

invested in Opportunity Funds ("OF") that hold at least 90 percent of their assets in businesses or 

tangible property located in low-income areas designated as OZs. Further, the capital gains on 

an investment in an OF can be federal income tax-free if the investment is held for at least ten 

years. The tax benefits could reduce the cost of capital for these projects, making them more 

viable, especially when paired with other development incentives such as the New Markets Tax 

Credit. Unlike many federal, state and local development incentives, there are no caps or 

allocations limiting the extent of investment in OZs. Congress intended that the OZ program 

operate with minimal restrictions in order to maximize investor participation and thus economic 

activity and job creation. 

What are the Requirements to Qualijj1 as an Opportunity Zone? 

The threshold requirement to be an OZ is a population census tract with at least a 20 percent 

poverty rate or median income that does not exceed 80 percent of the larger of the average 

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Mary Burke Baker 

Government Affairs Counselor 

K&L Gates LLP 

median income in the state or applicable metropolitan area. Twenty-five percent of qualifying 

tracts in each state, including Florida, have been named as qualified OZs upon nomination by 

state governors and designation by the Secretary of the Treasury. The designation of all OZs has 

been completed and this information is available on the Treasury website. Because OZs were 

identified at the local and not the federal level, states (and possessions, and the District of 

Columbia) have more control over the development of underserved communities. 

Opportunity Funds 

A qualified OF is any investment vehicle organized as a corporation or a partnership (including 

a multi-member LLC) for the purpose of investing in and holding at least 90 percent of its 

assets in qualified OZ property. An OF may invest in directly in tangible property used in a 

trade or business of the fund, or hold an equity interest in a corporation or partnership 

(including a multi-member LLC) operating a qualifying business in an OZ. An OF may invest 

in property and businesses in only one OZ or in multiple OZs. Funds will be required to selfcertify armually to the IRS whether they comply with the 90 percent test, measured on an annual 

basis based on the averages of investments held at the six-month marks of the OF's taxable year. 

Investor Incentives 

Any individual or corporation, and most pass-through entities, including partnerships and trusts, 

with taxable capital gains arising from the sale or exchange with an unrelated person of 

business or nonbusiness property, including stock, real estate, personal property, or an 

enterprise, may invest the capital gains in an OF within 180 days of the transaction (counting the 

day of the transaction) and enjoy tax deferral on the gains. This can include foreign investors 

with a U.S. capital gains tax obligation. Taxes on the capital gains invested in the OFs are 

delayed until the earlier of the disposition of the investment in the OF or December 31, 2026, 

with I 0 percent and 5 percent increases in basis at the five- and seven-year holding periods, 

respectively (a total of up to 15 percent). In addition, capital gains on OF investments (but not 

the deferred capital gains) held for at least 10 years will not be subject to federal income lax. 

Proposed regulations state the investments can be held as late as 2047. ln total there are three 

benefits to investors: the tax deferral and the increase in basis on the original capital gains 

invested, and the tax-free treatment of capital gains on the investment in the OF if held at least 

I 0 years. To achieve the maximum OZ benefit, investments in an OF must be made by 

December 31, 2019. Investments in an OF must be made no later than December 31, 2026. 

Qualified OZ Property 

Qualified OZ property includes any qualified OZ stock, any qualified OZ partnership interest, 

and any qualified OZ business property acquired by an OF by purchase after December 31, 

2017. Property must be held by an OF to be qualifying property. As discussed below, 

qualified stocks and qualified partnership interests must be in domestic corporations and 

domestic partnerships that are qualified OZ businesses. 

Qualified OZ Business Property 

Qualified OZ business property is tangible property owned by the OF directly or by an OZ 

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business owned by the OF and substantially used within the OZ. Qualifying tangible property 

must be acquired by purchase after December 31, 2017. The original use of the property must 

be in the OZ or the OF must "substantially improve" the property. Original use is not defined in 

the statute, but the JCT' s explanation of the term defines it to mean new property. There is 

speculation that forthcoming Treasury regulations may allow property that has been abandoned 

or in disuse tor a certain period of time to be deemed original usc. To meet the substantially 

improved requirement, the OF must invest an amount equal to or greater than the adjusted basis 

of the building within any 30-month period after the date of acquisition. Proposed regulations 

clarify that the value of the land on which the building is sitting is not taken into account for 

purposes of the substantial improvements test. The beginning of the 30-month period is unclear. 

The JCT's Blue Book indicates that it begins on the date of acquisition of the property, but the 

term "any" in the statute suggests it could begin on a date later than the date of acquisition. 

Anticipated proposed regulations are expected to clarify many of these important questions. 

Qualified OZ Business 

A qualified OZ business is an active trade or business located in an OZ. Per proposed 

regulations, at least 70 percent of the tangible property used in the business must be qualified 

OZ business property. At least 50 percent of the total gross income of the business must be 

from the active conduct of the business. It is unclear whether this means that at least 50 percent 

of the gross income must arise from within the OZ, or that 50 percent of the income must arise 

from operating the business within the OZ but that sales can occur anywhere within or without 

the OZ. Forthcoming proposed regulations are expected to answer this important question and 

will have a significant impact on the types, sizes and numbers of businesses that can qualify to be 

OZ businesses. A substantial portion of the entity's intangible property must be used in the 

active conduct of the business. Certain types of businesses, including golf courses, racetracks, 

gaming facilities, and establishments selling alcohol for off-premise use do not qualifY. 

Less than 5 percent of the business' aggregate unadjusted bases in assets may be in nonqualificd 

financial property, including stock, prutnership interests, long-term debt, options, and certain 

other financial products. Proposed regulations provide a safe harbor for working capital held 

by the business. Funds that the business holds but is not ready to invest toward the acquisition, 

construction or substantial improvement of tangible property will be excluded from 

nonqualified financial property if the business has a written plan showing that the funds will be 

spent within 31 months on qualifying property, a timeline demonstrating the expenditure of the 

funds, and the business substantially adheres to the plan and the timeline. Funds accounted for 

in the written plan will be treated as qualifying property for purposes of the 90 percent test that 

OFs must meet to avoid penalties. At this time, the safe harbor is available only to OZ 

businesses and not to OFs that directly hold their tangible assets. The safe harbor helps resolve 

potential bottlenecks that can arise when investors must invest in OFs within 180 days of the 

capital gains transaction and the OF must invest at least 90 percent of its assets in qualifying OZ 

property, yet the OZ business is not yet ready to spend the funds because it is waiting for 

building or zoning permits or experiencing other delays. 

The 70 percent threshold and the working capital safe harbor represent advantages of an OF 
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holding an equity interest in a qualifying OZ business compared to an OF having direct 

ownership of tangible property. 

Examples of Opportunity Zones in Action 

While the statutory terms and conditions of OZ may seem confusing and complex, the program 

is intended to be user-friendly in order to facilitate participation and maximize the potential for 

economic growth and job creation. The following examples demonstrate how OZ can be 

implemented as well as the flexibility of the program to accommodate a wide array of projects in 

order to achieve these policy goals. Note that these are simple examples for illustrative purposes 

and additional details would apply for actual transactions. 

• Affordable housing. An abandoned warehouse is located in an OZ near schools, 

public transportation and a grocery store. A developer sees the potential to convert the 

building into affordable housing. The developer sets up an OF in January 2018 to 

accept capital gains from investors that the OF will use to purchase the warehouse and 

convert the warehouse into housing. In February 2018, investors invest $1 million of 

capital gains into the OF within 180 days of their realizing the gains. Later in February 

2018, the OF acquires the warehouse property for $1 million. $600,000 of the cost is 

allocated to land and $400,000 to the warehouse building. Over the course of the next 

30 months, the OF spends $400,001 to substantially improve the property, funded by a 

series of capital calls of additional capital gains being invested within 180 days from 

when they arise. At all times, the OF holds at least 90 percent of the capital gains 

invested in the OF in the warehouse property and the ongoing improvements. The 

rehabilitation is completed in August, 2020. Investors hold their investment in the OF 

until2031. 

In tax year 2026, investors pay tax on deferred capital gains, including $850,000 on the 

first tranche ($1 million less a 15 percent increase in basis), and on each capital call 

tranche invested thereafter, calculated based on the holding period of each additional 

investment and the applicable percentage increase in basis. In tax year 2031, investors 

dispose of their investments in the OF at a capital gain of$7 million. The entire $7 

million capital gain is not subject to federal capital gains tax. This project meets all of 

the timing, location and investment requirements of the OZ incentive. 

Manufacturing. An entrepreneur invents a product and wants to manufacture the 

product in an OZ. Entrepreneur forms a domestic corporation in 2018 that will build, 

own and operate the manufacturing facility. The entrepreneur locates a fund sponsor who 

sets up an OF for the purpose of investing in the new manufacturing corporation. Later 

in 2018, the OF sponsor lines up investors with $5 million in capital gains to invest in the 

OF within 180 days of the transactions giving rise to their capital gains. The OF buys 

newly issued stock in the manufacturing entity for $4.8 million, meeting the 90 percent 

test. The corporation has a written plan and spending timeline demonstrating how it will 

spend the $4.8 million \Vithin 31 months to build the structure and install production 

equipment. The business adheres to the written plan and the time line. The 

manufacturing facility is located within an OZ, including plant and equipment, and all 

manufacturing is performed in the OZ. At least 50 percent of the sales are within the 

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OZ. The corporation's income is from the active trade or business of manufacturing, 

patents held by the corporation are used in the trade or business, and the company holds 

minimal passive financial assets. 

Investors retain their investment in the OF for at least I 0 years. In tax year 2026, 

investors pay tax on deferred capital gains of $4,250,000 ($5 million less 15 percent 

increase in basis). In 2029, investors sell their interest in the OF at a gain of$5 million, 

which is not subject to federal capital gains tax. This project meets all of the timing, 

location and investment requirements of the OZ program. 

Retail. A local grocery store chain with a robust corporate responsibility initiative 

identifies the need for a full service grocery store in an OZ. In 2018, the chain forms a 

new partnership for purposes of constructing and operating a store in the OZ. The grocery 

chain's bank has set up an OF for the purpose of investing in OZ projects and the OF will 

invest to build the new store. The bank locates investors who invest $3 million in capital 

gains into the OF within 180 days of the applicable transactions giving rise to the capital 

gains and the OF invests $2.9 million in the new grocery store partnership. The 

partnership has a written plan demonstrating how it will spend the $2.9 million within 31 

months to construct the building, acquire fixtures and purchase delivery vehicles and 

other tangible assets necessary to operate the store. The business adheres to the written 

plan and the timeline. Upon completion of construction, the store is an active business 

with at least 50% of its income arising from sales within the OZ. 

In 2026, investors pay tax on deferred capital gains of $2.55 million ($3 million less 15 

percent increase in basis) and when they dispose of their investment in the fund in 2030 

for $8 million, the entire capital gain from the investment is not subject to federal capital 

gains taxes. This project meets all of the timing, location and investment requirements of 

the OZ program. 

How Liberty City Can Compete Successfully for OZ Investments 

The impact ofOZ on any particular area, including Liberty City, is largely dependent on the 

OZ's ability to attract investment. There are no statutory caps or allocations limiting the use of 

or investments in OZs. However, there is competition for investor dollars and projects among 

OZs as awareness about the program spreads among investors, developers, entrepreneurs and 

communities throughout the United States. To compete, economic development authorities, 

government agencies, business associations and community leaders in urban and rural areas 

throughout the country are taking steps to proactively encourage investment in their 

communities by publicizing the program and community needs, and coordinating with 

stakeholders to facilitate the use of OZs. These steps include: 

• Understanding the policy goals of OZ and the requirements and mechanics of the 

program to be able to maximize the use and benefits of the program 

• Identifying the types of businesses and services needed in the community that could be 

provided using the OZ program 

• Working with local financial institutions to set up OFs to facilitate investments and 

projects in the community 

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• Working with local business and community leaders, entrepreneurs and innovators to 

encourage their participation in the program by sponsoring funds, locating investors and 

starting businesses 

• Coordinating the OZ program with the Community Reinvestment Act and other federal, 

state and local development initiatives and programs 

• Coordinating zoning and permitting guidelines and requirements to cut red tape, promote 

businesses and developments that will serve existing residents of OZs and prevent undue 

gentrification 

• Developing messaging to address potential investor and entrepreneur questions and 

concerns about risk, return on investment and why Liberty City is a good place to invest 

• Marketing the OZ program through websites, roundtables, panels, public meetings and 

informational materials 

The Future ofOZ 

This is an opportune time to determine how OZ can benefit Liberty City and for the city to 

launch aggressive efforts to attract investors and projects. Now that Treasury has released an 

initial round of proposed regulations, many investors and project developers who were waiting 

for guidance are ready to take action on OZ. Entrepreneurs are eagerly anticipating additional 

regulations more focused on businesses and will be ready to act when those regulations are 

released. Additional legislation to facilitate use of the incentive also may be on the horizon, 

including adaptations of OZ for disaster recovery or infrastructure. 

However, this window of time is not open-ended. Certain time parameters in the legislation limit 

how long investors can wait. To benefit from the 10 percent step-up in basis, investments in OFs 

must be made no later than December 31, 2021, and to benefit from the total 15 percent step-up 

investments must be made by December 31, 2019. Investors must invest no later than 

December 31, 2026 to qualify for tax-free treatment of capital gains on a I 0-year or longer OF 

investment. In addition, investors face a strict 180-day limit in which to invest realized capital 

gains in an OF and qualifY for beneficial tax treatment. Project planning and permitting lead 

times, the 30-month time frame to meet the substantially improved requirement, and the 31-

month working capital safe harbor present additional time constraints and pressures. 

Opportunity Zones arc aptly named and offer tremendous opportunities to disadvantaged 

communities like Liberty City to stimulate economic grov.ih and job creation and to improve 

the quality of life for residents on a long-term basis. OZ tax incentives for investments in lowincome areas can reduce the cost of capital for development projects and attract investments 

that might otherwise be directed elsewhere. It is vitally important that communities like Liberty 

City understand the program and act promptly in order to maximize their ability to attract longterm investments and ensure they receive their fair share of OZ investments and projects. 

Enclosure: OZ Flow Chart 

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Chairman RUBIO. Thank you. 

Let me just start by saying that all this talk about reinvesting 

and revitalizing our community, sometimes there’s a perception 

created that we’re talking about charity, that this is a nice thing 

to do. This is not charity. The biggest challenge of the 21st century 

is the competition with China in every realm, okay? China has 1.4 

billion people. The U.S. has 330 million people. We need everybody. 

They have four times as many people as we do. We can’t afford to 

be leaving anybody behind. 

So the idea that we have communities with incredibly intelligent 

and talented young men and women who, because of the circumstances they find themselves in, sometimes born with four or 

five strikes against them, and you start adding it up—substandard 

housing, dangerous neighborhoods, a difficult family situation— 

when you start adding all of that up, these children are going to 

struggle to succeed unless some dramatic things happen to change 

that cycle, and that was the thought process behind the Miami 

Children’s Initiative and the Magic City Initiative. It now has been 

renamed a couple of times, but it’s based on the Harlem Children’s 

Initiative. 

Oh, it’s Miami Children. Was it Magic City at one time? Then it 

went back to Miami. It started out as—what was the original when 

we first did it? Magic City Initiative, right. Children’s Zone, exactly. And expanding, hopefully. And there are similar groups now 

in Jacksonville, Orlando, and some other places. That was the idea 

behind that, and that continues to grow. 

To break that cycle, you have to get involved in those factors. 

But ultimately, it’s in our geopolitical interests as a country to deal 

with it. That’s how big this is. 

So I want to start with Dr. Bendross-Mindingall. We’ve talked a 

lot about talented young men and women. This doesn’t get enough 

coverage, but there are children and students growing up in this 

community that are going away to incredible colleges, getting advanced degrees, and then we don’t see them again. People have the 

right to do that. But in these instances, many times they cannot 

come back. There’s nothing to come back to in terms of a job or employment. 

So I wanted to talk to you a little bit about what do you think 

is a major obstacle to keeping our talent here. 

Dr. BENDROSS-MINDINGALL. Thank you, Mr. Senator. 

Partly, almost in a sense shutting them out. I’m looking at the 

audience, and I don’t see what I expected to see. When you come 

to Liberty City, I expect to see Liberty City. And if they’re here, 

if they were here, they could take the message out. 

The district that I serve on the school board includes 65 schools, 

but I’m up for the challenge, the idea that we want to have as 

much curricula in the system so that children can find a pathway 

to success. And I don’t like the statement that all children are not 

going to college. You should add to that, ‘‘but they can go here.’’ 

So right now we’re looking at more technology is needed because, 

as you said, children in Liberty City are absolutely bright, and I 

pat myself on the back because I’m one of them. Liberty City is 

known for just being closed out. 

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In my opinion, when I look at certain neighborhoods and I travel 

all over because I can, I don’t see our children sought after to be 

in parts of the neighborhood. I just saw something on TV last night 

where two young men of color were arrested. Why? Because the officers said you don’t look like you should be in this neighborhood. 

Well, I think the first look at me, you would not think that I was 

evicted twice. So what does that look like? 

We’ve got to provide—and as you said, Mr. Senator, we don’t 

have now the housing that’s needed. We’re working as hard as we 

can bringing programs into schools. I have 15 traditional high 

schools and five alternative high schools. We are filling those alternative high schools as fast as we can. Lindsey Hopkins is one. D.A. 

Dorsey is another. 

We have to make sure that we have something for the children 

to come back home for, and the jobs are not there. But if you’re not 

educated, how are you going to get those jobs? 

I’m glad we have this panel where we’re reaching out to small 

businesses, but that has to be something—I’m digressing now— 

that the circle of brotherhood—and I keep saying that, they are 

creating jobs. I don’t know if you know Leroy Jones, Mr. Senator? 

Good. They create jobs. They are now helping those people, our 

people, all people, who are returning citizens. But before they were 

able to go ahead and interview for a job, they were allowed to become their own bosses. 

But our children don’t have to come back and struggle as maybe 

generations before them did. They can go everywhere and anywhere other than Miami. I have a daughter who works for the City 

of Miami. Her efforts were looked at by one of the former mayors, 

and when she came home from Spellman she came out of high 

school to that job. 

But we have to look out for the other children, and I don’t think 

we’re doing enough of that. I really, really don’t. Schools are trying 

as hard as they can, but we’ve got to combine all efforts, all efforts. 

The zip codes that Mr. Liu mentioned, those are hard core zip 

codes, and we should be trying our very best to go in there almost 

daily, what’s going on. 

And let me just add this before I close. Years ago I worked with 

a beautiful woman named Janet Reno. We rewrote the lease. We 

met Monday nights talking about what was supposed to be done 

in public housing. Mr. Senator, I don’t know if you have the time 

or want to send someone in. Please take a look at that lease. 

Things that were supposed to be done were not done. One was either a resident would go to school or get a job. That was not enforced. So it’s like a domino effect. If the parents cannot take care 

of the children, then the children will take care of themselves in 

a fashion that we don’t like. 

So it’s not the greatest place for our children to come back to, but 

we can do it. I know a little bit about your family. We didn’t come 

from greatness, but somebody in that house said to us you’re going 

to get an education because that’s going to be your key and your 

pathway to success. Well, parents who have not seen that kind of 

a world will not insist that their children go to school. 

So it’s not here for our children to come back. We have to work 

as a unit to bring them back. 

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Chairman RUBIO. We’re going to try. 

The committee rules limit—we’re bumping up on the time here, 

but that’s why I want to rush through it real quick. But let me just 

say this. We do have to highlight success, and many of you are 

aware of Judge Rodney Smith, who is from the community, grew 

up in the community. 

Dr. BENDROSS-MINDINGALL. Yes. 

Chairman RUBIO. He’s going to be a Federal judge as soon as we 

work through the labyrinth that is the Senate rules and how complicated it all is. But we’re very proud of that nomination. 

[Applause.] 

And children in the community will know there’s a Federal 

judge—he’s still in the community. ‘‘That could be me’’ is what we 

hope they’ll think. 

I want to rush quickly because I don’t want to run out of time. 

On the issue of feasibility, you talk about the feasibility loophole 

and the local hiring. One of the things I was most interested in 

when I went down is that there are still challenges. One of the 

things is it’s great to hire someone and do the construction work, 

but it’s also important that as a result of that work they acquire 

the licensing and the skills so that’s not the last job they have. 

They now become people working in that industry that can be 

hired by somebody else. How have you worked through that? 

Mr. LIU. Well, in partnership with Related Urban—and Alfred 

Milo, the principal of Related Urban, is here. To their credit, and 

working with us and the school board, as an example, we have created for the first time ever a legally operating school board-endorsed apprenticeship program that formally will assist these 

entry-level workers to work up the scale to become actual tradesmen. There are a number of examples right now on Phase I. If you 

go out there, you will see people working who have worked through 

that program and are working in the program that then, even after 

this project is over, they will have the skills to continue to work 

with the subcontractors they’re working with now or with other 

companies, and there are mentorship programs that are being facilitated right now, again in partnership with Related and a number of their subcontractors. 

I would also mention that there’s strong collaborative work going 

on with the county’s boot camp effort where we’re taking young 

people who have a record, ex-felons, and giving them a trade, giving them an opportunity to increase their level of skills so that 

they will be able to continue in the line of work that they’re involved with. 

Chairman RUBIO. Okay. And I do have to hurry. I got a note that 

the Vice President is in town at an event I’ll be at later, but they’re 

closing roads. They don’t close them that often. Our traffic is bad 

enough as it is. 

But, Mr. Van Hook, quickly, about the SBDC’s, a lot of people 

aren’t even aware they exist. If you could briefly just tell us what 

do they do, how do they help a small business? 

Mr. VAN HOOK. SBDC, as I mentioned, we have a team of consultants such as George Rain, who’s here, and they basically work 

one-on-one with the business owner to help them start a business 

or grow a business. Actually, we don’t sit in an office basically 

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waiting for people to come to us. We actually go out into the community and meet with the business owners at their place of business, go out to events such as here and around. So we pretty much 

try to be out of the office, and we intentionally set up our center 

to be kind of decentralized versus kind of the traditional SBDC 

model. 

VOICE: [Inaudible.] 

Mr. VAN HOOK. I can give it to you, ma’am. SBDC.FIU.EDU is 

our website, and our phone number is 305–779–9230. 

Chairman RUBIO. Ms. Baker, I wanted to ask, you talked about 

briefly the type of investments that communities like this should 

be focused on to anchor it in the community so that we can ensure 

that this is not leading to gentrification, forcing people out, and actually is employing people here locally. 

Ms. BAKER. Sure. The initial round of interest in Opportunity 

Zone, simply because of the guidance that’s been issued, has been 

focused on real estate development. So we’re seeing a lot of clients 

that are interested in affordable housing. That’s been a particularly 

important aspect of investing in Opportunity Zone property. 

We do expect, as additional guidance and clarification comes out 

from the Department of the Treasury, that we’re going to see much 

more interest in businesses, because that’s really where you get the 

long-term sustained economic growth and the job creation. 

So this can be virtually any type of a trade or business, as long 

as it’s an active trade or business and a new trade or business. It’s 

not intended to take a business that exists and retrofit it into 

qualifying. It needs to be new economic activity that’s going to create new jobs, and it can be anything from retail to grocery stores 

to clothing stores to a movie theater to a medical clinic to daycare, 

as well as any industrial or any type of manufacturing. It’s really 

a very resilient, flexible program. 

Chairman RUBIO. They will all be staying after because we’ve 

run up against the clock here for the time allotted for the hearing. 

All of this stuff is now included in the record, and we’re going to 

continue to engage with everybody who is here and all the partners. 

We wanted really to do this so we can get it in the record as we 

go back, and even from here we’ve already developed ideas about 

what we can do on those loopholes on hiring and what we need to 

do to ensure that we’re attracting not just investment but the right 

type of investment, and where we can work, whether it’s through 

the HUD programs or the Small Business programs, to ensure that 

the Federal laws reflect—or even on the lease. Someone mentioned 

how the leases were reworked and how all that has been sort of 

left behind, and the programs that need to be at the housing and 

HUD level to ensure that they’re tied to employment opportunities 

so that you’re not just providing housing, you’re providing more 

than housing. You’re providing the opportunity to get skills and/or 

a job so you move forward. It’s a hand up. So we’re hoping people 

prosper and move forward. 

We did it with about one minute to spare. Everything here can 

be followed up on. By the way, the record is going to remain open 

for two weeks. So if anybody has anything written that they want 

to see part of this record, we’re going to give you the opportunity 

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to submit that here. We’ll give you our contact information, because 

in about two weeks—— 

VOICE: May I say something? 

Chairman RUBIO. I’m sorry? 

VOICE: May I say something? 

Chairman RUBIO. It will have to be real quick because we’re 

going to run out of our rule time here that we have. 

Yes, sir? 

VOICE: First of all, thank you for coming. I would just echo some 

of the concerns—— 

Chairman RUBIO. Just use your preacher voice so we can all hear 

you. 

[Laughter.] 

VOICE: I want to echo some of the concerns that the Congresswoman made when it comes down to gentrification and making 

sure that as we are for upward mobility, we are for economic development, we are for all of those things, but we are also for traditional neighborhoods such as Brownsville, Livingston, 

Overtown—— 

Chairman RUBIO. Don’t forget anybody. You’ll get in trouble. 

[Laughter.] 

VOICE: We are concerned about the rich culture that these communities exhibited many, many years ago. If given time, in 

Overtown, you can walk down the street and you’ll see a James 

Brown or an Aretha Franklin or many other greats of that time. 

What we’re seeing is that when we talk about the programs, the 

housing project that we have at Liberty Square and Brownsville, 

those are two rich communities. Out of Liberty Square you have 

not only our great school board member, we have Miss [inaudible]. 

I can just name many, many great people who came out of Liberty. 

Let me just wrap this up right here. I want to be respectful to 

the Senator because he has to go with the Vice President. 

But what we’re seeing is that when we have this public-private 

partnership, we want to make sure that all of the regs, all of the 

regulations are followed, and especially the 1968 Public Fair Housing Act, which Dr. King, in the 1964 Civil Rights Act, had this in 

mind. He had this vision that low- and moderate-income housing 

individuals would not be taken advantage of, and gentrification 

would not exist. 

So what we’re saying is that we would like for you, as our U.S. 

Senator, to monitor this, making sure that the civil rights are not 

violated of the citizens in those low-income neighborhoods because 

many of our communities—you take Brownsville, you take Adam 

[inaudible], Overtown, we have a project going on right now, an 

$802 million project going on by 395, the 836, and the I–95 project. 

I attended a meeting the other day with the Department of 

Transportation, and we asked whether or not there was any minority participation on the Federal level. They said they don’t have to 

put set-asides, but they’re going to try to reach a 10 percent threshold; and whether or not there was community engagement. There 

was not any community engagement. I represent the district, and 

I have not heard about one meeting in these projects where we 

have $802 million. 

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Let me just say this, because there are so many things I wanted 

to say, and I like to talk fast. I will make my statement in writing 

since we’ve got a two-week period—— 

Chairman RUBIO. Yes, yes. 

VOICE: I’ll put it in writing so that you will be monitoring these 

Federal dollars. These are dollars in the Constitution and in acts 

that are supposed to protect low-income families and people. 

We are concerned about the fact that our neighborhoods are 

changing. Liberty City and Brownsville and all of these areas, 

Overtown, they just ripped out eminent domain, 85 housing in this 

395 project. 

So what we’re seeing, Senator, we need your help. You’re doing 

a good job representing us, but we’re not going to sit back. Those 

of us who have children and grandchildren, when we leave here on 

this earth, we want to make sure that they can live in Liberty 

Square, they can live in Overtown. We don’t have Overtown [inaudible]. 

So I’m not busting at you, Senator, because that wouldn’t be the 

right thing to do, but I will say this: We need your help. 

Chairman RUBIO. Yes, sir. And that was the purpose of this 

hearing, to ensure that we just don’t have redevelopment. 

[Applause.] 

The purpose of this hearing was not just to have redevelopment 

but to have redevelopment that allows the community to be the 

community, because it’s easy to just—we’ve seen it happen all over 

the country. It’s happened all over the country, and we thought 

this was a great place to start focusing on because it was the opportunities there. But if it’s not properly managed, you’re going to 

wind up with a community that has really fancy, $2 million condominiums, but the people who made it what it was aren’t there 

anymore to enjoy it. 

So the record will remain open for two weeks. Please submit in 

writing everything you have. 

And I apologize. We had an hour and 45 minutes allocated for 

this. But we thank you, and we’re going to take these ideas and 

turn them into something. 

And with that, the meeting is adjourned. 

[Whereupon, at 10:39 a.m., the hearing was adjourned.] 

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(51) 

APPENDIX MATERIAL SUBMITTED 

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SMALL BUSINESS. BIG IMPACT. 

R~pert en Sman l$ ... sinesses In Miami-Dade County 

2018 
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Small Business Economy Snapshot .......................................................................................... 1 

Overview of the Small Business Economy of Miami-Dade County ........................................... 2 

Miami-Dade's Small Business Profile ....................................................................................... 4 

Trends of Firms by Employment Size ... 

Employer Establishments by Sector. 

Private Employment and Wages by Firm Size 

........................................ 4 

.. ............................... 5 

........ 9 

Employment and Wages in All Establishments..... .. .................. .. . .............. 12 

The Gig Economy: Self-Employment and Nonemployer Establishments 

Small Business Loans 

... 17 

..... 20 

Appendix A: Methodology ..................................................................................................... 22 

Appendix B: Distribution of Establishments by Sector and Size ............................................ 23 

List ofT abies 

TABLE 1: DISTRIBUTION OF FIRMS BY EMPLOYMENT SIZE ... .......................... s 

TABLE 2: DISTRIBUTION OF FIRMS BY SECTOR AND SIZE ... .. .................................... s 

TABLE 3: MIAMI-DADE BUSINESS COUNT BY SIZE, 2015 ......................................................................................... 9 

TABLE 4: MIAMI-DADE EMPLOYMENT BY FIRM SIZE, 2010-2015 ...... 

TABLES: AVERAGE WAGES BY ENTERPRISE SIZE, 2015 .... 

TABLE 6: MIAMI-DADE AVERAGE WAGES BY FIRM SIZE, 2010-2015 ...... 

............... 10 

.. ................ 11 

.. ... 11 

TABlE 7: MIAMI-DADE EMPLOYMENT BY ESTABLISHMENT SIZE ....................................................................... 12 

TABLE 8: MIAMI-DADE EMPLOYMENT AND WAGES ... ............... 12 

TABlE 9: MIAMI-DADE SINGLE-EMPLOYEE ESTABLISHMENTS ............................................................................... 14 

TABLE 10: AVERAGE WAGE IN MIAMI-DADE ESTABLISHMENTS BY SIZE AND YEAR CREATED .... . .... 15 

TABLE 11: MIAMI-DADE ESTABLISHMENTS BY SIZE AND YEAR CREATED ............................................................ 16 

TABlE 12: SELF-EMPLOYMENT IN BENCHMARK COUNTIES AND THE UNITED STATES BY OCCUPATIONS ........... 17 

TABLE 13: AVERAGE RECEIPTS IN NON EMPLOYER ESTABLISHMENTS ................................................................ 18 

TABLE 14: TOTAL LOAN AND SMALL BUSINESS LOAN ORIGINATION FOR SBA·BACKED LOANS, 2016 ................... 20 
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Ust of Figures 

FIGURE 1: DISTRIBUTION OF FIRMS BY EMPLOYMENT SIZE .. 

FIGURE 2: YEAR-OVER-YEAR FIRM CHANGE BY EMPLOYMENT SIZE , .. 

"'"" """""""""""""4 

"" ,,,,4 

FIGURE 3: PROFESSIONAL SCIENTIFIC AND TECHNICAL SERVICES, TOP FIVE SECTORS BY NUMBER OF FIRMS --···----· S 

FIGURE 4: WHOLESALE SECTORS BY NUMBER OF FIRMS " " "" ".,,.6 

FIGURES: EMPLOYMENT BY BUSINESS SIZE, MIAMI-DADE COUNTY, 201S" """" 10 

FIGURE 6: YEAR-OVER-YEAR JOB GROWTH BY BUSINESS SIZE, MIAMI-DADE COUNTY, 2011-2015 ......................... 10 

FIGURE 7: DIFFERENCE IN AVERAGE WAGES BY BUSINESS SIZE, 2010-201S "" . " • """""" """"""""""""""" 11 

FIGURE 8: NUMBER OF ESTABLISHMENTS BY SIZE" 

FIGURE 9: SECTORS WITH MAJORITY EMPLOYMENT IN FIRMS UNDER 100 EMPLOYEES" 

FIGURE 10: SECTORS WITH HIGHEST AND LOWEST WAGES" 

"""'"" 13 

""' 13 

"" """""""14 

FIGURE 11: CHANGE IN NONEMPLOYER ESTABLISHMENTS AND RECEIPTS(SALES), 200S-201S """""""""""""""" 18 

FIGURE 12: CHANGE IN LOANS TO BUSINESSES WITH REVENUES OF $1M OR LESS, 2010-2016" . ,,21 
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NUMBERCll=" 

ESTABLISHMENTS 

""" EMPLOYMENT 

With 1-4 employees: 54,754 

With 5·9 employees: 12,139 

With 10-99 employees: 13,913 

With 100499 employees: 1,340 

With 500+ employees: 147 

!!2,2!13 

employer 

establishments 

• Private employment increased by 23.3% from 2010 to 2016 

• 53.3% of priva~e employ,ment in the county was in firms w~th fewer than 

500 workers' 

• 1Cisi!%of<!!mpfoyinent is in microbusinesses (174,246-wbrkers) 

• The largest1ob growth (2010-15) was in businesses with 20-99 employees 

(22-9%), 100-499 employees (23-7%) and 500+ workers (19.8%). 

W9rkers in Miami-Dade earn on, average $49,343 ~cross aU sectors 

Woikers at micn~businesses earn 19% less than workers in firms wtth 

;>,':~': '~~ ;>'~'" ',,, \,'>:': ~' ' ':~<" >:::':~;' sectors employ under 200k wor~ers and the lowest 

,~arntnS 'Sectors aCcount for over 600k of the workforce 

A sharp !ncrea,se in SEA-backed foans to businesses wi~h gross annual 

revenues of$1mlllio~ or less to 99,030 in 2016, ul) tr?rnll,?'l7 in2Ql0 

, ,J?~~~~fl\~).lj:lt )o bu~fnesses l)lith reyenues o{ $1 million '"less in Miami-

,,, ,,' :tl'a(leJ~cre~sed liy 336.7% from 2010 to 2016 

AVerage loan amount to small businesses decreased by ~8.6% 
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The private sector and local entrepreneurial activity are the foundation of the U.S. economy, but the 

manifestation of that axiom is amplified in Miami-Dade County, where a very high portion of the 

workforce is employed in for-profit activities. More than two thirds of workers in Miami (70.8 percent) 

work for private companies, and 6.4 percent are self-employed in 

their own incorporated business. Private employment is slightly 

higher than the national figure of 68.6 percent while selfemployment is almost double that of the country's 3.6 percent 

(U.S. Census, American Community Survey (ACS), 2016). A 

comparison over time also shows private sector employment 

continues to increase at a faster pace than other sectors 

(nonprofit or government). From 2010 to 2016, employment in 

private companies increased by 23.3 percent, outpacing the 19.9 

percent workforce growth. Self-employed workers in their own 

incorporated businesses increased by 22.4 percent for the same 

period. Self-employed unincorporated business workers 

increased by 19.1 percent. 

Workforce: 1,290,097 

Change from 2010: 19.9% 

Private Employment: 913,338 

Change from 2010' 23.3% 

• Self-Employed in own 

incorporated businew 82,795 

Change from 2010: 22.4% 

• Self-Employed in own not 

incorporated business: 111,531 

Change from 2010: 19.1% 

Source: U.S. CensuS.-ACS 2010 and 2016 

Most private sector workers are employed in Retail (15.6 percent), Healthcare and Social Assistance (12.8 

percent), Accommodation and Food Services (12.5 percent), Transportation and Warehousing (7.8 

percent), and Professional Scientific and Technical Services (7.0 percent). Altogether, these five sectors 

employ 56 percent of the workforce. Another important sector for the Miami-Dade economy is 

Construction, which employs approximately 7.0 percent of the private workforce. While the retail sector 

employment in Miami-Dade is on par with national figures, Miami has a higher proportion of the 

workforce in Accommodation and Food services, and Transportation and Warehousing. Conversely, a 

higher portion of the U.S. workforce is employed in the Manufacturing sector, 13.4 percent vs. 5.8 percent 

in Miami. Other sectors in the United States with a higher share of private employment include 

Professional, Scientific and Technical Services, Agriculture and Information. (ACS, 2016) 

Over the last five years, the Miami metro area has consistently ranked in the top three in entrepreneurial 

activity, as measured by the number of new business startups {Kauffman Index of Entrepreneurship 

produced by the Ewing Marion Kauffman Foundation). In 2017, Miami surpassed Austin, TX, for the first 

spot in the ranking of new business creation. However, Miami ranked fifth from the bottom in 

entrepreneurship growth, with only Detroit ranking lower in start-up employment and revenue growth. 

According to the most recent United States Global Entrepreneurship Monitor (GEM) survey, 22 percent 

of working age adults in Miami are starting or running new businesses, compared to the national average 

of 12.6 percent. The survey also found that 19 percent of entrepreneurs in Miami are starting out of 

necessity versus opportunity. Nationally, an average of only 11 percent of entrepreneurs start out of 

necessity. A larger percentage of entrepreneurs in Miami (24 percent) have at least some graduate 

education compared to the national average (19 percent). In terms of industry, Miami shows high startup 

activity in the Manufacturing/Transportation and Finance/Real Estate sectors, compared to national 

averages. 

Tile Small Business Eoonomy In Mlamf.Dade Counzy 
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Miami-Dade has over 82,000 business establishments across a range of industry sectors. The U.S. Census 

defines an establishment as "a single physical location at which business is conducted or services or 

industrial operations are performed. It is not necessarily identical with a company or enterprise, which 

may consist of one or more establishments." (U.S. Census, County Business Patterns Glossary) 

Combined, the top four sectors in terms of number of business establishments account for almost 52 

percent of businesses. These four sectors include Professional, Scientific, and Technical Services (16.4 

percent), Retail Trade (13.3 percent), Wholesale Trade (11.1 percent), and Health Care and Social 

Assistance (10.8 percent). (U.S. Census, County Business Patterns, 2015). Almost all businesses in MiamiDade are small, with 98.2 percent employing fewer than 100 workers.' The majority of businesses- 81.3 

percent- are microbusinesses, i.e. they employ fewer than 10 workers. Nationally, 97.6 percent of firms 

have fewer than 100 employees and 76.0 percent are microbusinesses (U.S. Census Bureau, Business 

Dynamics Statistics, 2015). 

Most of the U.S. workforce (51.8 percent) is employed in firms with more than 500 employees, while 

about 10.5 percent are employed in firms with fewer than 10 workers. In Miami-Dade, the employment 

dynamics are different, with most of the workforce concentrated in firms with fewer than 500 employees 

(53.3 percent). Micro businesses account for 10.8 percent of employment. 

1 For description of the criteria for small business designation, see the U.S. Small Business Administration guide on size 

standards, https:Uwww.sba.gov/contracting/resources-smaH-businesses/determining-business-size 
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Miami-Dade's Small Business Profile 

Miami-Dade has over 82,000 small businesses that employ over 900,000 workers (U.S. Census, County 

Business Patterns, 2015). Microbusinesses have consistently accounted for most of the private 

establishments in the county, around 81 percent of the total. Conversely, large companies (over 500 

employees) are typically only 0.2 percent of firms.' 

The 2007-2009 recession shrunk the 

number of establishments in the county by 

4.6 percent, from 76,176 in 2007, down to 

72,673 in 2009. This decrease signifies the 

occurrence of more business deaths than 

business births. It affected firms of all 

sizes, but firms with under 100 employees 

declined by only 4.5 percent, while those 

with 100-499 employees and businesses 

with over 500 employees decreased by 9.3 

percent and 10.6 percent respectively. 

These figures also likely reflect the 

downsizing of larger companies. 

New business creation began to 

outpace business deaths in 2010 

and the latest available data for 

2015 shows an overall 2.6 percent 

year-over-year growth of firms (See 

Figure 1). The most significant 

growth (9.3 percent) was in midsize establishments between 100 

and 499 employees. (U.S. Census, 

County Business Patterns) 

10% 

0% 

-10% 

-20% 

-30% 

-40% 

50-99 employees, 2.0% 

l00·499e!'l'lPIOye{!s, L6% 

FIGURE 2: YEAR-OVER-YEAR FIRM CHANGE BY EMPLOYMENT SIZE 

•• u .. 100-499 500+ 

2 Unless indicated otherwise, the report uses the definitions of the U.S. Census for enterprises, firms and establishments 

(https://www.census.gov/programs-surveys/cbp/about/glossary.html). Enterprises and companies are used interchangeably. 

For small-size enterprises {under 100 employees), the number affirms and establishments overlap, therefore they will be used 

interchangeably. 'Business' wHI be used as a general reference for privately-owned organizations of any size. 
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Miami-Dade's distribution of firms by employment size is different from six other benchmark counties 

selected for comparison (See Appendix A for more discussion on methodology). The six counties and their 

cities are San Diego County (San Diego, CA), Orange County (Orlando, FL). Fulton County (Atlanta, GA), 

Mecklenburg County (Charlotte, NC). King County (Seattle, WA) and Harris County (Houston, TK). Miami 

has a lower percentage of both mid-size (100-499 employees) and large businesses (500+ employees) than 

the other counties (See Table 1). Conversely, Miami has the highest percentage of microbusinesses (81.3 

percent) of the comparison counties. 

Most businesses in Miami-Dade are in five industry sectors: Professional, Scientific and Technical Services; 

Retail Trade; Wholesale Trade; Healthcare and Social Assistance; and Other Services. Combined, these five 

sectors account for 58.9 percent of all businesses. 

Professional, Scientific and Technical Services 12,272 13.457 72 

Retail Trade 8,367 10,607 301 11 

Wholesale Trade 7,660 9,025 77 

Healthcare and Social Assistance 7,098 8,701 152 33 

Other services 5,170 6,011 29 1 

Total Firms across all Sectors 66,893 13,913 1,340 147 

Source: U5. Census, County Business Patterns, 2015 

Professional. Scientific and Technical 

Services: These establishments are 

engaged in activities that require a high 

degree of expertise and training. Some of 

the activities performed include legal 

services; accounting, bookkeeping, and 

payroll; architectural, engineering, and 

specialized design services; computer 

services; consulting; research services; 

advertising; photographic services; 

translation and interpretation services; 

veterinary services; and others. 

FIGURE 3: PROFESSIONAL SCIENTIFIC AND TECHNICAL SERVICES, 

TOP FIVE SECTORS BY NUMBER OF FIRMS 
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The sector includes over 13,000 businesses, of which only three have 500 or more employees. Nine 

out of ten businesses in this sector (90.7 percent) are micro businesses with fewer than 10 employees. 

Firms providing legal services are almost a third of establishments in this sector, followed by businesses 

providing management, scientific and technical consulting services (See Figure 3). The three large 

establishments, with over SOO employees each, are in the Advertising/Public Relations, Engineering 

and Computer Systems, and Accounting subsectors. Overall, less than one percent of firms in these 

subsectors have more than 100 employees. 

Retail Trade: These establishments sell merchandise and provide after-sales services such as repair and 

installation. 

Approximately a third of the almost 11,000 businesses in this sector are clothing (20.5 percent) or food 

establishments (14.2 percent), followed by health and personal care stores (11.1 percent), motor 

vehicle and parts dealers (10.0 percent) and miscellaneous store retailers (9.0 percent). Only eleven 

businesses in the sector employ 500 or more workers- nine in general merchandise, one in food and 

beverage, and one in health and personal care. Approximately two-thirds of firms in this sector are 

microbusinesses (76.6 percent), while overall97.1 percent employ fewer than 100 workers. 

Wholesale Trade: This sector comprises two main types of wholesalers: merchant wholesalers that sell 

goods on their own account and business-to-business electronic markets, agents, and brokers that 

arrange sales and purchases for others generally for a FIGURE 4, WHOLESALE SECTORS BY NUMBER 

commission or fee. OF FIRMS 

The majority of the over 9,000 establishments in this 

sector are merchant wholesalers of durable goods 

(60.7 percent), followed by merchant wholesalers of 

nondurable goods, and wholesale electronic markets, 

agents and brokers. There are only nine companies 

employing over 500 workers, six of which are classified 

as nondurable goods merchant wholesalers. Similar to 

the other sectors, most firms are microbusinesses 

(84.1 percent), and 99.1 percent employ fewer than 

100 workers. 

Healthcare and Social Assistance: The industries in this sector are arranged on a continuum starting with 

those establishments providing medical care exclusively, continuing with those providing health care 

and social assistance, and finally finishing with those providing only social assistance. The services 

provided by establishments in this sector are delivered by trained professionals. 

This sector has 33 establishments that employ 500 workers or more, the largest of any other sector. 

Twenty-four (24) of them are hospitals. Most of the approximately 9,000 establishments in this sector 

(79.0 percent) are ambulatory health care services, including physicians, dentists, medical and 

diagnostic laboratories, and home health care services. This sector also includes social assistance 

establishments, which provide individual and family services, rehabilitation, and child day care (14.4 
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percent). There are also 550 nursing and residential care facilities (6.2 percent) and 32 hospitals {0.4 

percent). 

Approximately 79.9 percent of establishments in the sector have fewer than 10 employees, while 

overall 97.9 percent employ fewer than 100 workers. 

Other Services: Establishments in this sector are primarily engaged in activities such as equipment and 

machinery repairing; promoting or administering religious activities, grant making, advocacy; and 

providing dry-cleaning and laundry services, personal care, death care, pet care, photofinishing, 

temporary parking, and dating services. 

Over 6,000 establishments in this sector are distributed across three subsectors: Repair and 

Maintenance (32.1 percent), Personal and Laundry services (39.0 percent), and Religious, Grant 

Making, Civic, Professional, and similar organizations (29.0 percent). The only firm in the sector that 

employs over 500 workers is classified as a parking lot/garage. Overall, 99.5 percent of firms employ 

fewer than 10 workers, while 85.6 percent are microbusinesses. 

Almost half of the Miami-Dade workforce (49.1 percent) is employed in Healthcare and Social Assistance 

(12.4 percent), Retail (11.8 percent), Accommodation and Food Services (9.7 percent), Construction (7.8 

percent), and Educational Services (7.3 percent). These figures include all classes of workers, 

encompassing both private firm and self-employment, as well as government employees. Most private 

sector workers are in Retail (15.6 percent), Healthcare and Social Assistance (12.8 percent), 

Accommodation and Food Services (12.5 percent), Transportation and Warehousing (7.8 percent), and 

Professional Scientific and Technical Services (7.0 percent). Altogether, these five sectors employ 56 

percent of the workforce. Only three of these sectors are in the top five in terms of number of firms: 

Professional, Scientific and technical Services, Healthcare and Social Assistance, and Retail. The following 

section describes the distribution of firms in the other economic sectors. 

The Real Estate and Rental and Leasing sector ranks sixth by number of establishments, with 

approximately 5, 700 firms. The sector employs only about 25,000 workers. Almost nine of ten 

establishments in this sector (88.9 percent) are engaged in real estate activities, while the remaining 

firms provide rental and leasing services, or are lessors of nonfinancial intangible assets. Three 

businesses in this sector employ over 500 workers, while 93.1 percent have fewer than 10 employees. 3 

Accommodation and Food Services: The sector comprises establishments providing customers with 

lodging and/or preparing meals, snacks, and beverages for immediate consumption. 

The sector is comprised of approximately 5,300 establishments. Accommodation businesses account 

for91.4 percent of establishments and the remaining 8.6 percent provide food services. Microbusiness 

are 52.9 percent of companies, while overall 96.5 percent of firms employ fewer than 100 workers. 

Most large businesses in this sector (12) are in the Accommodation sub sector while three are classified 

as 'Food Services and Drinking Places'- food contractors and restaurants. 

Construction: The sector comprises establishments primarily engaged in the construction of buildings or 

engineering projects (e.g., highways and utility systems). Establishments primarily engaged in the 

3The U.S. Small Business Administration uses sales figures in the classification of real estate businesses. The U.S. County 

Business Patterns does not collect business sales data. 
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preparation of sites for new construction and in subdividing land for sale as building sites also are 

included. Construction work done may include new work, additions, alterations, or maintenance and 

repairs. 

Approximately 67.0 percent of about 4,600 businesses in this sector are specialty trade contractors, 

including foundation, structure, and building exterior contractors; building equipment contractors, 

building finishing contractors and others. Establishments in the Construction of Buildings subsector 

accounts for 27.6 percent of firms. This sub sector comprises establishments of the general contractor 

type and for-sale builders involved in the construction of buildings. Heavy and civil engineering 

construction firms are 5.3 percent of companies. 

There are no establishments with over 500 workers in this sector. The majority (99.2 percent) have 

fewer than 100 employees, while 84.8 percent employ fewer than 10 workers. 4 

Finance and Insurance: This sector is also a major contributor to Miami-Dade's economy, with 

approximately 4,500 businesses and approximately 48,000 workers. Most establishments (82.8 

percent) employ fewer than 10 workers, while 98.2 percent have fewer than 100 employees. 

Educational Services: Establishments in this sector provide instruction and training in a wide variety of 

subjects. The instruction and training is provided by specialized establishments, such as schools, 

colleges, universities, and training centers. These establishments may be privately owned and operated 

for profit or not for profit, or they may be publicly owned and operated. Establishments that manage 

schools and other educational establishments on a contractual basis are also included in this sector. 

Six establishments in this sector employ 500 workers or more. One establishment is classified as 

'Elementary and secondary schools', and five are in the category of 'Colleges, universities, and 

professional schools'. Almost two· thirds of the over 1,000 establishments in this sector employ fewer 

than 10 workers (65.8 percent), while 95.5 percent have under 100 employees. 

See Appendix B for detailed breakdown by number of establishments. 

4 The Small Business Administration defines small businesses in the Construction sector as establishments with less than $15 

million in sales for specialty trade contractors subsectors, and $36.5 million for the Construction of Buildings and the Heavy 

and Civil Engineering subsectors. The U.S. Census County Business Patterns database does not contain information on sales. 
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Firm Size 

Small businesses are important contributors to Miami-Dade's economy as they account for the majority 

of establishments and private employment in the county. In fact, 81% of the over 82,000 private 

businesses have fewer than 10 employees. By comparison, 73% of businesses in the United States are in 

that size class. (U.S. Census Bureau, 2015 County Business Patterns) The U.S. Census, the Small Business 

Administration, the Bureau of Labor Statistics and other sources for business data make a distinction 

between enterprises, firms and establishments. An establishment generally refers to a single location, 

while a single firm may consist of many separate establishments. An enterprise may be a single firm or a 

combination of firms that engages in economic activities that are classified into multiple industries.' 

Analysis of Business Employment Dynamics data from the Bureau of Labor Statistics shows that 

enterprise- and firm-level series consistently track each other and follow a similar pattern of peaks and 

troughs over the business cycle.' Table 3 shows the distinction between firms and establishments. Firms 

with fewer employees are 

less likely to have multiple 

locations and the 

difference between the 

number of firms and 

establishments is smaller. : 100-499 employees. 1,291 

The employment and ' 500+ employees 1,642 

annual payroll figures are : Total 73,764 

shown for each enterprise 

category. 

4,653 

2,208 

8,668 

82,293 

154,199 

141,028 

443,326 

949,355 

$23,523,698 

. ·-----------

$44,834,611 

Source: U.S, Census Bureau, Statistics of U.S. Businesses, 2015. 

The employment data by business size is supplied by the U.S. Census in the Statistics of U.S. Businesses 

(SUSS) annual series, which were developed in cooperation with, and partially funded by, the Office of 

Advocacy of the U.S. Small Business Administration (SBA). SUSS covers most of the country's economic 

activity. The series excludes data on nonemployer businesses, private households, railroads, agricultural 

production, and most government entities. The analysis that follows will focus on employment 

distribution in enterprises rather than firms or establishments. 'Enterprise', 'company', 'business' and firm 

will be used interchangeably. It should also be noted that approximately 30% of workers in Miami-Dade 

are not accounted for in the private employment analysis as they work in nonprofit or government 

agencies, or they are self-employed. Subsequent sections will discuss overall employment in the county 

as well as the "gig economy" data, which deals with self-employed workers and nonemployer businesses. 

According to SUSB, in 2015, the majority of private employment in the county (53.3%) was in enterprises 

of fewer than 500 employees. In other words, smaller companies are a bigger job contributor to MiamiDade's economy than 500+ employee companies. By comparison, while only about 0.3% of U.S. 

businesses have over 500 employees, they account for 53% of employment. 

5 For definitions of each category, see Statistics of U.S, Businesses (SUSS) Glossary, https:J/www,census.gov/programs~ 

surveys/susb/about/glossary.htm! 

6 See Akbar Sadeghi, David M. Talan, and Richard L Clayton, "Establishment, firm, or enterprise: does the unit of analysis 

matter?", Monthly Labor Review, U.S. Bureau of Labor Statistics, November 2016, https://doi.org/10.21916/m!r.2016.5L 
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Additionally, small businesses are also a significant contributor to job growth. Between 2010 and 2015, 

employment in companies offewerthan 500 employees increased by 17.1%, slightly lower than the 19.8% 

employment growth in 500+ employee firms. Since 2007, employment in businesses of fewer than 500 

employees in Miami-Dade has hovered between 53-

55% of total employment. Table 4 shows a more 

detailed breakdown by four employment size 

categories. The most significant job growth in the 2010-

2015 timeframe was in companies of 100 to under 500 

employees (23.7%). Job growth in businesses with 

fewer than 20 employees was only 9.4% in the same 

period. Approximately 147,000 private jobs were added 

to the economy from 2010 to 2015. Large businesses 

(500+ employees) accounted for 49.8% of the job 

FIGURE 5: EMPLOYMENT BY BUSINESS SIZE, 

MIAMI-DADE COUNTY, 2015 

< 20 employees 

11:: 20-99 employees 

• 100-499 employees 

• 500+ employees 

growth, adding over 73,000 jobs. 

139,533 147,826 

123,260 124,811 131,809 141,028 ~ ~~- . ___ ,_,,, __ --"-"' 

395,973 407,333 427,844 443,326 - ~-·---~~--~ 

823,116 861,535 886,497 919,859 949,355 18.4% 

Source: U.S. Census Bureau, Statistics of U.S. Businesses, 2010-2015. 

Since 2010, employment in the four 

business size categories has increased yearover-year, but the growth has been most 

consistent for larger businesses. Figure 6 

shows the percentage change of total 

employees in the respective business sizes. 

Job growth slowed down for businesses 

with fewer than 100 employees, while 

growth in larger businesses was generally 

higher, especially in 2014 and 2015. 

FIGURE 6: YEAR-OVER-YEAR JOB GROWTH BY BUSINESS 

SIZE, MIAMI-DADE COUNTY, 2011-2015 

12% 

8% 

4% 

0% 

-4% 

2011 

·< 20 employees 2.1% 

--20-99 employees 6.3% 

•-"~100-499 employees -2.1% 

--500+ employees 3.0% 

2012 

3.0% 

4.6% 

10.4% 

3.9% 

2013 

1.9% 

5.9% 

1.3% 

2.9% 

2014 

1.1% 

2.5% 

5.6% 

5.0% 

2015 

1.0% 

1.8% 

7.0% 

3.6% 

Another way to examine the contribution of small businesses to the Miami-Dade economy is with the 

analysis of wages. SUSB data reports aggregate data by business size which only allows for the calculation 

of the average wages. It should be noted that the distribution of workers by wage level is highly skewed, 

as the average is affected by very high income earners. The median wage is substantially less than the 

llle Small Busln""" Economy In Miami-Dad& C<>w>l;y 
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average wage. The Office of the Chief Actuary, U.S. Social Security Administration, calculated that the ratio 

of national median to average wage in the 2010-2015 period was approximately 65%. 7 A subsequent 

section on Employment and Wages in All 

Firms which relies on individual firm data 

will demonstrate the difference for MiamiDade workers. However, the comparison of 

wages across enterprise size categories 

shows that wages of businesses with fewer 100-499 employees 

than 100 employees were 14% lower than 5oo+ employees 

the overall average wage for workers in ' Total · 

private companies. Source: U.S. Census Bureau, Statistics of U.S. Businesses, 2015. 

The gap in average wages between small and large companies expanded in 2014 and 2015. Figure 7 shows 

the percentage difference between average wages paid to workers in enterprises with fewer than 100 

employees and companies with 100-499 workers, in comparison to large companies with 500 or more 

employees. As previously noted, companies 

with fewer than 500 employees account for 

most of employment in the county, and the 

gaps have broader economic implications for 

overall wage structure in the area. 

Historically, the gap between large 

companies and those employing fewer than 

100 workers has been significantly higher 

than for mid-size enterprises. The figure 

shows that after a dip in 2012, it began to 

increase again. 

25% 

20% 

15% 

10% 

5% 

0% 

--<100 employees *'-100-499 employees 

23.4% 

203% 

13.6% 

2010 2011 2012 2013 2014 2015 

The increasing gap is also linked to the slower wage growth in smaller companies. For accurate 

comparisons, the nominal wages for each year were adjusted for inflation. Overall, the average wage of 

private company workers increased by 4.7%, mostly as a result of the 6.5% increase of mean wages of 

workers in large companies. In fact, when adjusted for inflation, from 2010 to 2015, wage growth in 

companies employing fewer than 100 workers was only 2.4%. 

500+ err:_p~!oyees 

Total 

$49,816 

$45,105 

$39,377 

$45,393 

$49,594 

$44,878 

$46,056 

$49,441 

$45,168 

$44,834 

$48,844 

$44,564 

$44,939 

$50,382 

$45,372 

Source: U.S. Census Bureau, Statistics of U.S. Businesses, 2010-2015. 

7 See Measures Of Central Tendency For Wage Data, Office of the Chief Actuary, U.S. Soclal Security Administration. 

https://www.ssa.gov/OACf/COLA/central.html 

li 
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This section presents employment and wage data by size of firm from the Quarterly Census of 

Employment and Wages (QCEW) program of the Florida Department of Economic Opportunity (DEO), 

which collects the number of employers or reporting units, monthly employment, average employment, 

total wages, and average wages by industry classification. The database covers 98 percent of U.S. jobs 

available by industry at the county level, and includes both public and private organizations. Unlike the 

analysis in the previous section, which relied on the Statistics of U.S. Businesses (SUSB) data from the U.S. 

Census, the QCEW includes the whole universe of employers, including public agencies such as the local 

school board and the U.S. Postal Service8 The dataset provided by the Florida DEO contains 79,526 

organizations that employed at least one employee in mid-2016. Because the QCEW is collected based on 

the location of employers, the total employment in QCEW is larger than the Miami-Dade workforce. In 

other words, the total employment includes workers who commute from other counties. While not 

directly comparable to other government sources of firms, employment and wages, this dataset provides 

more current information than the County Business Patterns and allows for more detailed analysis by 

employment size, firm establishment and wages. To remain consistent with term use in the QCEW, this 

section refers to all reporting units in the QCEW as establishments. 

In 2016, most of the workforce was in establishments 

with fewer than 500 employees (See Table 7). These 

establishments also accounted for 54.4 percent of wages 

paid. Table 8 shows a detailed breakdown of 

employment and wages by organization size. Wages at 

larger employers in Miami-Dade are generally higher. 

Workers at establishments with over 100 employees 

earn on average approximately $51,800, or about five 

percent more than the overall average wage. 

1 employee 

2-9 employees 

10-99 

100-499 employees 

>500 employees 

Total 

148,919 9.3% 

409,019 25.4% 

322,435 20.0% 

703,978 43.7% 

1,609,678 

Almost 81 percent of establishments in Miami-Dade employ fewer than 10 workers. The average wage at 

these small employers is four percent lower than at establishments with a workforce of 10 to 99, and 

almost 19 percent lower 

than establishments with 

over 100 employees. 

Average wages were 

calculated by dividing the 

total wages in each size 

category by the total 

number of employees in 

these establishments. In 

addition, Table 8 also 

8 The reporting units in the QCEW database are firms, rather than establishments. Reporting practices of multi-establishment 

firms vary across states depending on state law requirements, Florida law permits firms with multiple establishments to 

report as a single entity. 
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shows the aggregate median wage for each size category. The aggregate median value is simply the middle 

value in the sorted list of average wages for each size class. In other words, this is the median of average 

values rather than a median based on employee-level data. For example, the last column shows that the 

aggregate median for microbusiness establishments is $30,667, which means that half of the 

establishments in that class pay an average wage lower than that figure, and half have average wages 

above it. 

FIGURE 8: NUMBER OF ESTABLISHMENTS BY SIZE 

40,000 36,767 

30,000 

20,000 

10,000 

Estab!lshment Size by Number of Employees 

Overall, 36.2 percent of employment is in smaller establishments of under 100 workers. However, there 

are six sectors in which the majority of the workforce is concentrated in smaller firms, as shown in Figure 

9. The firms in these sectors employ less than a quarter of the total workforce in the county. Only two of 

these sectors - Manufacturing and Other 

Services - have wages above the average 

county wage. The Professional, Scientific 

and Technical Services sector has the 

highest concentration of employment in 

microbusinesses (30.9 percent). In fact, 

this sector leads in the number of singleemployee firms (S,294), followed by 

'Other Services' with 3,352 firms. Table 9 

shows that approximately one in three 

establishments with a single employee are 

in these two sectors. These two sectors 

are at opposing ends of the wage 

spectrum, with an average wage of 

$79,333 in the Professional, Scientific and 

Technical Services sector, and $31,523 in 

the 'Other Services' sector. (See following 

section on Wages) 

FIGURE 9: SECTORS WITH MAJORITY EMPLOYMENT IN FIRMS 

UNDER 100 EMPLOYEES 

Professional, Scientific and 

Technical Services 

Construction 

Rea! Estate 

Wholesale Trade 

Other Services 

Manufacturing 

<10 1110~99 II Over 100 
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The workforce in the top sectors by 

employment - Retail, Healthcare and Social 

Assistance, and Accommodation and Food 

Services - is primarily concentrated in larger 

establishments of over 100 employees. Over 70 

percent of the workforce in the Retail and 

Healthcare and Social Assistance sectors is in 

establishments of 100 employees or more. In 

the Accommodation and Food Services, 51.9 

percent of employees are in firms of over 100 

employees. Approximately 80 percent of the 

Transportation and Warehousing sector 

workforce is in establishments over 100 

employees. 

Wages 

Technical Services 5,294 20.9% 

Other Services 3,352 13.2% 

Retail Trade 2,711 10.7% 

Healthcare and Social 2,274 9.0% Assistance 

Wholesale Trade 2,191 8.7% 

Real Estate 2,022 8.0% 

Construction 1,521 6.0% 

Administrative and 1,296 5.1% Support 

Finance and Insurance 1,149 4.5% 

, ~Tfanspori:at.IOn ana 851 3.4% Warehousing 

Total: 25,327 

Source: Florida Department of Economic Opportunity, Quarterly 

Census of Employment and Wages (QCEW), 2016. 

Overall, across all industry sectors and size of establishments, employees earn an average of $49,343 in 

Miami-Dade County (QCEW, 2016). However, wages vary depending on the industry sector of 

employment. Figure 10 shows a comparison of the top five and bottom five industry sectors by wages, 

and in comparison to the average wage in the county. The highest earning sectors employ under 200,000 

workers, while the lowest earning sectors account for over 600,000 of the workforce. 

'$35,359 

f:AP$$@$1~ and Food Services, $24,585 

$0 $20,000 $40,000 $60,000 $80,000 $100,000 $120,000 

Tile Small Buslni!ISS Economy In Miami-Dade Coun~ 
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Establishment size in terms 

of employment also affects 

wages, as shown in Table 10. 

While establishments 

younger than 2 years have 

average wages of under 

$42,000, those who have 

been in existence for 10 years 

or more pay on average over 

$52,000. 

2-9 $44,101 $44,304 $44,715 

10·19 7,943 $42,504 $44,932 $48,617 

20-49 5,587 $38,191 $43,422 $44,197 $48,026 

50-99 1,904 $39,071 $46,299 $44,584 $51,502 

100·499 1,658 $48,869 $44,843 $51,513 $55,649 

500+ 330 $42,408 $35,477 $49,923 $52,801 

Overall 79,504 $41,484 $42,997 $47,792 $52,229 

Source: Florida Department of Economic Opportunity, Quarterly Census of Employment and Wages 

{QCEW), 2016. (Note: Table excludes establishments for which year of creation or employment size 

are not available.) 

The analysis of wages by size of the establishment within sectors shows that in most sectors, the average 

wages are higher in larger companies. For example, employees of construction companies with 100 or 

more workers earn 38 percent more than the average wage for the sector. Conversely, those employed 

in firms with fewer than 100 employees, earn seven percent less than the average wage for the sector. 

The average wage of employees of transportation and warehousing companies with more than 100 

workers is four percent higher than the salary for the sector, while workers in companies of fewer than 

100 workers earn 13 percent less on average. 

There are three sectors in which the average wage in smaller establishments is higher than the wage for 

the respective sector overall. In the Management of Companies and Enterprises sector which employs 

just over 10,000 workers, the average wage for smaller companies (under 100 workers) is 19 percent 

higher, and in companies over 100 workers it is 7 percent lower than the wage for the sector. Similar 

differences are observed in the Administrative and Support and Waste Management and Remediation 

Services, and the sector that combines all other services. 
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Another factor that may affect wages is the age of the firm. In 2016, approximately 19 percent of all 

establishments were less than two years old. Table 11 shows the relationship between size and age from 

the QCEW database. Almost a quarter (24.1 percent) of single-employee firms reporting employment and 

payroll data in 2016 were 

established in 2015 or 2016. The 

table shows a positive correlation 

between firm age and size. Smaller 25,324 24.1% 28.3% 23.9% 23.8% 

establishments are more likely to be 2-9 36,758 17.8% 21.8% 25.6% 34.9% 

younger. The median year of 10-19 7,943 14.6% 19.7% 27.4% 38.3% establishment for all companies in 20-49 5,587 15.4% 19.4% 26.0% 39.2% the QCEW database is 2010. The 50-99 1,904 14.3% 17.6% 24.9% 43.1% median age for single employee 

companies is 4 years (median year of 100-499 1,658 8.9% 14.9% 23.7% 52.5% 

establishment 2012). In contrast, the 500+ 330 4.5% 9.1% 18.2% 68.2% 

median year for the 330 companies Overall 79,504 19.0% 23.2% 25.1% 32.7% 

Source: Florida Department of Economic Opportunity, Quarterly Census of 

of 500 employees or more is 1999. Employment and Wages (QCEW), 2016. {Note: Table excludes establishments for 

which year of creation or employment size are not available.) 

Almost 140,000 workers are employed in "young" establishments with less than two years of existence, 

and another 190,000 in firms that have been around for only two to four years. However, approximately 

60 percent of Miami-Dade's workforce is in establishments that have been in business for 10 or more 

years. 
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THE GIG ECONOMY: SELF-EMPLOYMENT AND NONEMPLOYER ESTABLISHMENTS 

The rate of self-employment and the number of nonemployer establishments are often used as measures 

of the "gig" economy, in which workers perform specific tasks on a contractual basis for the duration of 

the task completion. Many gig workers fit the Census definition of a nonemployer: in most cases, a selfemployed individual operating a very small, unincorporated business with no paid employees.' 

Miami-Dade County has had historically higher rate of self-employment than the United States. The 2016 

Census estimates put Miami's self-employment rate at 15.0 percent of all workers over age 16. That rate 

has stayed stable over time, only fluctuating slightly with the lowest self-employment at 13.6 percent in 

2011. The area's self-employment rate is also higher than any of the other benchmark counties. 

Table 12 also shows self-employment rates for broad occupational groups. Almost a third of the Miami 

workforce employed in natural resource, construction and maintenance occupations are self-employed. 

Almost one in six employees in service, as well as management, business, science and arts occupations 

are also self-employed. 

In Management, 

business, science, and 10.3% 13.1% 10.8% 10.4% 8.8% 9.4% 

arts occupations 

In Service occupations 12.9% 14.3% 8.6% 12.9% 13.1% 13.9% 

In Sales and office 8.0% 9.0% 8.8% 8.2% 8.5% 7.6% occupations 

In Natural resources, 

construction, and 13.3% 17.5% 14.8% 15.4% 13.7% 13.4% 

maintenance 

In Production, 

transportation, and 7.9% 9.1% 8.7% 9.4% 6.5% 7.3% 

material movins: 

Source: U.S. Census Bureau, 2016 American Community Survey 1-Year Estimates 

9 A nonemp!oyers business is one that "has no paid employees, has annual business receipts of $1,000 or more {$1 or more in 

the construction industries), and is subject to federal income taxes. Most nonemployers are self-employed individuals 

operating very small unincorporated businesses, which may or may not be the owners principal source of income." Receipts 

figures include gross receipts, sales, commissions, and income from trades and businesses, as reported on annual business 

income tax returns. (Source: U.S. Census, h!ms://www.census.gov/eRCd/nonemp!oyer/view/define.htmll 
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Nonemployer establishments are another reliable 

measure of the rise of the Gig Economy that is 

the self-employed, freelance workers and 

independent contractors. Nonemployer 

establishments can be incorporated (categorized 

as "corporations") or unincorporated (categorized 

as individual proprietorships or partnerships). 

Between 2005 and 2015, the number of 

nonemployer establishments in the Miami area 

rose 55.9 percent, almost three times the national 

rate. Figure 11 also shows that Miami leads among 

the comparison counties in growth of 

establishments as well as total sales. The growth 

in nonemployer establishments in Orange County, 

FL, was slightly smaller than Miami's (55.4 

percent), and Mecklenburg County (Charlotte, NC) 

came close (48.6 percent). 

RTotal Receipts ttil Establlshments 

Orange County, FL 

Mecklenburg County, NC 

Fulton County, GA 

Harris County, TX 

San Diego County, CA 

King County, WA 

United States 

The growth in the number of establishments indicates strong entrepreneurial activity in Miami-Dade and 

is consistent with Miami's leading position in the United States in terms business creation, as ranked by 

the Kauffman Index. However, with average receipts per nonemployer establishment of $41,829, Miami 

lags the national average of $47,211, an 11.4 percent difference. The average receipts in almost all other 

comparison counties were above Miami's, with King County ($56,223) and Harris County ($51,174) at the 

high end. Only Orange County (FL) recorded lower average receipts per nonemployer establishment 

($40,519). 

Another significant finding is the decrease of the average sales per nonemployer establishment over time 

in most benchmark counties from 2005 to 2015 (Table 13). There was a modest increase of the average 

receipts for nonemployer establishments in the United States and in Miami-Dade. From 2005 to 2015, the 

average sales for nonemployer establishments 

in the United States increased by 1.2 percent. 

Average receipts in Miami-Dade increased by 

3.0 percent, from $40,627 in 2005 to $41,829 in 

2015. King County (Seattle, WA) had an increase 

of 8.8 percent. In contrast, the other counties had 

significant decreases in average receipts - 15.7 

percent in Orange County, 13.3 percent in Fulton 

County, and 6.9 percent in San Diego. The 

average receipt decrease was smaller for 

establishments in Mecklenburg ( -6.4 percent) 

and Harris County (-2.7 percent). 

TABLE 13: AVERAGE RECEIPTS IN NONEMPLOYER 

ESTABLISHMENT$ 

Miami-Dade County, FL $41,829 3.0% 

United States $47,211 1.2% 

Harris County, TX $51,174 -2.7% 

Mecklenburg County, $46,479 -6.4% 

San Diego County, CA $50,390 ~6.9% 

Fulton County, GA $50,995 -13.3% 

Orange County, FL $40,519 -15.7% 

Source: U.S. Census Bureau, 2015 Nonemployer Statistics 
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Miami has the highest percentage of nonemployer establishments in the "Other Services" sector, 18.0 

percent, which is the top sector in terms of number of firms. The top five sectors account for 62.5 percent 

of firms. The average receipts of firms in that sector in 2015 were $24,257. 

The other four sectors with a high concentration of nonemployer firms include: 

Administrative and support and waste management and remediation services (12.5 percent), 

Real estate and rental and leasing (12.1 percent), 

Professional, scientific, and technical services (10.4 percent), and 

Transportation and warehousing (9.5 percent) 

Average receipts in the Administrative and support services sector were only $18,197, significantly lower 

that the countywide average of $41,829 for nonemployer establishments. Real estate and rental and 

leasing establishments had average receipts of $77,153, while receipts in Transportation and warehousing 

were $40,531. 

One notable difference between Miami and the six comparison counties is the lower percentage of 

nonemployerfirms in the Professional, Scientific and Technical Services sector. Firms in this sector provide 

specialized services, which require a high degree of expertise and training, including legal services, 

engineering, accounting, research etc. Nationally, 14.0 percent of nonemployer firms are in that sector. 

Of the six comparison counties, King County (Seattle) has the highest percentage of nonemployer firms in 

this sector (23.7 percent), followed by San Diego (19.9 percent), and Fulton County (19.1 percent). Only 

10.4 percent of nonemployer establishments in Miami-Dade are in that sector, lower than the 12.4 

percent reported in Orange County, Fl. Average receipts for establishments in that sector in Miami-Dade 

were $49,377, or 18 percent above the county average. 
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Small Business loans 

Entrepreneurs rely on access to capital to supply the financing they need to commercialize innovation, 

seize marketplace opportunities, and compete locally and internationally. The Community Reinvestment 

Act of 1977 (CRA) seeks to ensure that banking institutions reinvest a significant portion of the deposits 

they take from local communities back into those communities. A 1995 revision to the CRA established 

that insured depository institutions must report their lending to small businesses and their provision of 

small loans to businesses. Approximately 2,000 financial institutions are subject to the reporting 

requirements of the CRA regulations. 10 The CRA data are the most comprehensive publicly available data 

on small business lending, covering approximately 86 percent of all loans of $1 million or less." 

According to the Federal Financial Institutions Examinations Council (FFIEC), there were 125 small 

business lenders in Miami-Dade in 2016 who provided SBA-backed loans12 However, the average size of 

business loans in Miami-Dade was significantly lower than the six comparison counties (See Table 14). In 

the United States, the average business loan to firms with revenues of $1 million or less was $26,626. The 

highest average loan of the six counties was in Mecklenburg, NC (Charlotte). However, Miami-Dade had 

the highest number of loan originations to businesses with gross annual revenues of $1 million or less49,595. With the exception of Harris County, in all other counties, loans to businesses with revenues of 

$1 million or less are the majority of loans. 

San Diego County $2,649,566 45,456 $923,488 $20,316 

30,435 $896,470 15,830 $303,766 $19,189 52.0% 33.9% 

17,749 $422,563 $23,808 54.3% 34.7% 

34.9%. 

Source: Federal Financial Institutions Examinations Council, FFlEC CRA Aggregate Reports, 2016 

10 All state member banks, state nonmember banks, national banks, and savings associations that are not small or special~ 

purpose institutions are subject to the data collection and reporting requirements of the CRA. A small institution fs a bank or 

thrift that, as of December 31 of either of the prior two calendar years, had total assets of less than $250 mU!ion. (A Guide to 

CRA Data Collection and Reporting, https://www.ffiec.gov/cra/pdf/cra_guide.pdf} 

11 Small business loans are defined as business loans of $1 mi!Hon or less. The CRA data also includes the number and dollar 

amount of those loans to businesses with gross annual revenues of $1 mi!llon or less. See Greenstone, Michael, Alexandre 

Mas, and Hoai-Luu Nguyen. 2015. "Do Credit Market Shocks Affect the Re;;~l Economy? Quasi-Experimental Evidence from the 

Great Recession and Normal Economic Times.'' NB£R Working Paper No. w20704. Cambridge, MA: National Bureau of 

Economic Research. 

12 Under the Community Reinvestment Act regulations, lending institutions report information on loans originated or 

purchased, but not on apptlcations denied. Institutions also indicate whether a loan is extended to a borrower with annual 

revenues of $1 million or less, but the data do not include demographic information about the appllcant 
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The comparison with loan originations and amounts between 2010 and 2016 shows a sharp increase in 

the number of loans to businesses with gross annual revenues of $1 million or less to 49,595 in 2016, up 

from 11,647 in 2010. The total amount of loans also increased but not as steeply, from $360 million to 

$787 million (See Figure 12). As a result, the average loan amount decreased by almost 50 percent. These 

dynamics are also present in the six comparison counties, as well as in the national figures. From 2010 to 

2016, the average loan to businesses with revenues of $1 million or less decreased by 38.6 percent in the 

United States. From among the six comparison counties, the highest decreases in average loan amount 

were in Orange County (52. 7 percent) and Fulton County (58.2 percent), higher than Miami-Dade's 48.6 

percent decline. 

FIGURE 12: CHANGE IN LOANS TO BUSINESSES WITH REVENUES OF 

OR LESS, 2010-2016 

Change in Total Loan Amount Change in Total Number of loans 

USA 

Fulton County 

Miami-Dade 

Orange County 

Mecklenburg 

Harris County 

San Diego 

King County 
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The Report on Small Businesses in Miami-Dade County relies on a number of data sources that produce 

statistics on the Miami-Dade economy and the establishments that operate within it. Some of these 

sources provide publicly accessible data sets, which include: 

U.S. Census: American Community Survey, Business Dynamics statistics, Survey of Business 

Owners, County Business Patterns, Statistics of U.S. Businesses (SUSS) and others, various years 

U.S. Small Business Administration: business definitions and size categories 

The report also relies on the Quarterly Census of Employment and Wages (QCEW) collected by the Florida 

Department of Economic Opportunity. The raw data supplied the statistics for employment and wages by 

firm size and sector. Since the database contains information allowing the individual firm to be identified, 

it has aggregation and confidentiality restrictions. 

Where data is available, the report also makes comparisons between Miami-Dade and six benchmark 

counties. Four of these counties- Mecklenburg (Charlotte, NC), Fulton (Atlanta, GA), King (Seattle, WA), 

and Harris (Houston, TX)- are also used as benchmarks in other prominent report, for example the MiamiDade Beacon Council's One Community, One Goal report. One benchmark county was selected from 

Florida- Orange County (Orlando, FL). The sixth benchmark county- San Diego, CA -was selected for its 

size (3.3 million) and large Hispanic population (33.5 percent). 

Notes on Data Sources: 

County Business Patterns (U.S. Census): The series covers more than 6 million single-unit establishments 

and 1.8 million multi-unit establishments. An establishment is a single physical location at which business 

is conducted or services or industrial operations are performed. An establishment is not necessarily 

equivalent to a company or enterprise, which may consist of one or more establishments. A single-unit 

company owns or operates only one establishment. A multi-unit company owns or operates two or more 

establishments. The series excludes data on self-employed individuals, employees of private households, 

railroad employees, agricultural production employees, and most government employees. 

Statistics of U.S. Businesses (SUSB): Statistics of U.S. Businesses (SUSS} is an annual series that provides 

national and subnational data on the distribution of economic data by enterprise size and industry. SUSB 

covers most of the country's economic activity. The series excludes data on nonemployer businesses, 

private households, railroads, agricultural production, and most government entities. 

Quarterly Census of Employment and Wages (QCEW): The Quarterly Census of Employment and Wages 

(QCEW) program collects the number of employers or reporting units, monthly employment, average 

employment, total wages, and average wages by the North American Industry Classification System 

(NAICS). The count covers 98% of U.S. jobs available by industry at the county, Metropolitan Statistical 

Areas, state and national levels; by major industry or by detailed industry categories. 

Insert offset folio 42 here 35697.042LAP51NQ082 with DISTILLER

Appendix B: Distribution of Establishments Sector and Size 

ESTABLISHMENT COUNT 

"' .,- -o::l c c ro~-g -o "' cc 0 "' c S'. -o .[ -g., "'"' fJ-oV> u 0 

C<UV> S'. rou :::.; -oO<!> 

Total -~~~ "' ~e ~~-~ ~~~ 

T:i t; (:it:i "' ~~ 

·c £::: e-~~ "' E '" E c"' "' c 1: 0 cc ro oro"' -" 0 c "' "' 3 "' u:- -o <!>U 0 u ::; $ "'"'>- "' "' ::I:.Jl 1-

1 to 9 employees 66,893 12,272 7,660 8,367 3,723 3,162 7,098 2,819 5,170 3,930 3,127 5,333 

10 to 49 employees 12,291 1,072 1,246 1,982 623 498 1,491 1,955 767 596 580 344 

50 to 99 employees 1,622 113 119 258 67 119 112 364 74 72 83 30 

100 to 499 employees 1,340 72 77 301 73 134 152 172 29 39 98 16 

500+ employees 147 3 9 11 8 17 33 15 1 0 19 

82,293 13,532 9,111 10,919 4,494 3,930 8,886 5,325 6,041 4,637 3,907 5,726 

PERCENTAGE DISTRIBUTION WITHING TOTAl NUMBER OF FIRMS IN RESPECTIVE ESTABLISHMENT SIZE 

1 to 9 employees 66,893 18.3% 11.5% 12.5% 5.6% 4.7% 10.6% 4.2% 7.7% 5.9% 4.7% 8.0% 

10 to 49 employees 12,291 8.7% 10.1% 16.1% 5.1% 4.1% 12.1% 15.9% 6.2% 4.8% 4.7% 2.8% 

50 to 99 employees 1,622 7.0% 73% 15.9% 4.1% 7.3% 6.9% 22.4% 4.6% 4.4% 5.1% 1.8% 

100 to 499 employees 1,340 5.4% 5.7% 22.5% 5.4% 10.0% 11.3% 12.8% 2.2% 2.9% 7.3% 1.2% 

500+ employees 147 2.0% 6.1% 7.5% 5.4% 11.6% 22.4% 10.2% 0.7% 0.0% 12.9% 2.0% 

Source: U.S. Census, County Business Pattern

•23 
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Small Business. Big Impact 

Report on Small Businesses in Miami-Dade County 

This report was created by the Metropolitan Center and commissioned by the Florida SBDC at FlU 

FlU 

Metropolitan 

Center 

The Metropolitan Center is the leading urban "think tank" in South Florida and an applied 

research unit in the School of International and Public Affairs (SIPA) at Florida International 

University. The Center has a solid record of providing technical services to communities in the 

areas of economic development, housing, transportation and land use planning. The Center's 

approach to providing technical services is to take into account the unique needs of individual 

communities, while adhering to recognized methodologies for data analysis and reporting. The 

Center houses the ongoing South Florida Regional Database Project, which includes asset 

mapping, best-practice research, and full in-house Remote Sensing and Geographic Information 

Systems (GIS) capabilities. Moreover, the Metropolitan Center is a Census Information Center 

(CIS), which allows for early access to embargoed data and data with restricted use. 

AM E R 1 c A"c s The Florida SBDC at FlU is the small-business development center located within the FlU College 

mr 

Business 

of Business. Part of the Florida SBDC Network*, the center each year works with more than 900 entrepreneurs and business owners in Miami-Dade with the objective of helping them grow. The 

SBDC at FlU provides no-cost one-on-one advisory services with regard to financial management, 

access to capital, market growth, international trade, government contracting and more. In addition, the center offers market and industry data and information to guide business decisions. 

Since launching in 2014, the SBDC at FlU has helped launch more than 107 businesses and has 

helped Miami-Dade businesses access more than $100 million in capital, as well as create, save 

or retain more than 7,500 jobs. 

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*The Florida SBDC Network is state Designated as Florida's Principal Provider of Business Assistance [§ 288.001, Fla. Stat.] The Florida SBDC at FlU is a member of the 

SBDC Network, a statewide partnership program nationally accredited by the Association of America's SBDCs and funded in part by the U.S. Small Business Administ

Defense logistics Agency, State of Florida, and other private and public partners, with the University of West Florida serving as the network's lead host institution. F

services are extended to the pub he on a nondiscriminatory basis. 

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