The North Miami Personnel Board met for a second time on January 24, 2019, to hear the termination appeal of former Assistant Budget Director Terry Henley.

After the character assassination he suffered at the hands of Deputy City Manager Arthur “Duke” Sorey the previous evening, Mr. Henley got the opportunity to defend himself on the stand.  His testimony begins on page six of the transcript.

The difference between the testimonies of Duke Sorey and Terry Henley is striking.

As you are about to see, while Deputy Duke came across as melodramatic, clueless and amateurish, Mr. Henley was composed, well-informed and extremely knowledgeable.

The Consummate Professional

From the moment Terry Henley’s testimony began, it was clear that he is a very intelligent individual who, unlike Deputy Duke, conducts himself in a dignified, highly professional manner.

Those brave souls in the audience must have immediately – and gratefully – realized they won’t be hearing Mr. Henley blurt out words “dude,” “half-ass shit,” or especially, any F-bombs while testifying.

Under direct examination by his lawyer, William R. Amlong, Esq., Mr. Henley spoke about about his education and his professional experience.  He holds a bachelor’s degree in Political Science and English and a Master’s in Public Administration, as well as a certificate of public management from Florida State.

Mr. Henley began his career as an intern in the city manager’s office of Lakeland, Florida, and then worked in transportation planning with the Florida Department of Transportation.  Mr. Henley then spent time working in the private sector in North Carolina managing public parking facilities before becoming the budget analyst for Martin County, Florida.

When asked how he ended up in North Miami, Terry said he responded to an advertisement for a budget administrator position.  Here’s how he described his interview with Deputy Duke (page 8 of the transcript):

I applied for it and I was reluctant to set the job on one condition. He asked me — it’s strange. Actually, it was funny.  The last interview question before he offered me the job was, “Who is your favorite rapper? East coast or west coast? Tupac or is it Biggie?”

And I said, “East Coast. I’m Biggie all the way.” He said, “That’s the wrong answer, but I’m offering you the job.” But then I knew we were going to hit it off then. I’m like we have good chemistry, and we work together, and you know, he mentioned this five-year plan to me, which was very appealing to me.

He said, “You know, I’m going to be City Manager here and I think you can help me.” And I told him, “I am. I can do that for you.”

In May of 2013, Mr. Henley was hired in the number two position under Duke.  Duke had just been promoted to Budget Director a few months earlier, and so Mr. Henley began helping his new boss prepare his very first budget for the 2013/14 fiscal year.

Go Team!

In July of 2015, Terry Henley helped Duke get the job of Deputy City Manager.  He told the Personnel Board, “I did his application. I wrote his cover letter. I drafted a platform for him with projects and how to complete them. He didn’t really want to do it. He didn’t want to become Deputy under Aleem Ghany. He was reluctant to do that. But I urged him to do that because I wanted to be promoted and I wanted to advance, so I’m like, “Yeah, what’s good for you is good for me.”

Huh?

Didn’t Duke testify just a day earlier that Terry Henley was “incompetent, inefficient and insubordinate?”

Apparently, he wasn’t too “incompetent, inefficient and insubordinate” to help Duke land himself the second highest job in the city.

Funny how that works!

As soon as Duke was promoted, Terry Henley quickly moved up the ladder, going from budget administrator to assistant budget director, and three months later in October, to acting director.  By then, he was managing the department without Duke’s involvement.

On October 27, 2015, Deputy Duke signed Mr. Henley’s Performance Evaluation Report, and wrote that Henley “Secured the City its first ever distinguisued budget presentation award from the GFOA.”

The previous evening, however, Duke had testified that this award was nothing but making “pretty pictures.”

“And the award goes to…”

In reality, Government Finance Officers Association (GFOA) created the Distinguished Budget Presentation Award Program “to encourage and assist state and local governments to prepare budget documents of the very highest quality that reflect both the guidelines established by the National Advisory Council on State and Local Budgeting and the GFOA’s best practices on budgeting and then to recognize individual governments that succeed in achieving that goal.”

Mr. Henley told the Personnel Board that less than ten percent of local governments throughout the United States receive this annual award.

He further explained, “What you have to do is you have to satisfy rigid, stringent criteria in taking your financials and being able to craft them into a narrative to easily explain the financials in layman’s terms to people. So essentially, you need to make it a communications device. You need to make it a financial plan. And it’s also an operations guide. So it’s all inclusive. It’s not just a print out of an Excel spreadsheet. It’s much more than that. And it was very significant to Arthur for this very reason. When I came aboard, and I was interviewed, I told him I have a lot of experience with that in Martin County and I can get you that award in two years. And he’s like, ‘Yeah, I want that.'”

Terry Henley was able to secure the Distinguished Budget Presentation Award in less than one year.

In fact, winning this prestigious award for the first time was so important to Duke Sorey and Larry Spring, they announced it on page 4 of the 2014-2015 Adopted Annual Budget for the “Fiscal Year Beginning October 1, 2013” – the year Terry Henley came to work for North Miami!

So much for Deputy Duke’s “pretty pictures.”

Handle With Care

Soon after Terry Henley was hired, he learned that Duke’s job was “fragile,” according to Sorey’s own words.

When former City Manager Stephen Johnson asked then-Budget Manager Kay Grant, who was moving to the finance department, if Arthur was ready to take her place, she told him, “He doesn’t have the work ethic and he doesn’t have the knowledge base to do it. No.”

Terry Henley testified, “He was very bitter with her about that. And then I learned — and then he told me, “You need to get the award this year.” That his job wasn’t stable.

Mr. Henley also discussed his national recognition in the GFOA’s June 2014 issue of Government Finance Review (page 14).

He explained, “Government Finance Review is a publication for public finance professionals. And I wrote an article about a budget innovation that I did where I explained earlier the importance of being able to explain financials in layman’s terms. Well, what this article did is I explained how I put the budget in sign language, I put it in Haitian-Creole, I put it in Spanish, and I put it in all these different languages considering the diverse community we have. And the basis of the article was that if people don’t understand their finances of their government, they’re not going to trust you. And in order for you to trust your government, you need to be able to understand your financials.“

Alas, as we already know, “Trust In Your Government” is not North Miami’s motto.

But we digress.

During his testimony on the previous day, Deputy Duke claimed that Mr. Henley’s performance “was shaky right off the start” (page 44 of Day 1 transcript), and blamed him for “a mistake in the trim package.”

Once again, Deputy Duke passed the buck, saying it was “the first major mistake under Terry Henley.”

And once again, Deputy Duke lied.

Mr. Amlong asked his client to explain (page 16 of the transcript) about the “trim package.”

Mr. Henley told the Personnel Board that the city has to comply with the Florida Truth and Millage Act (TRIM), which requires them to provide the millage rate to the Department of Revenue in order to send out notices advising homeowners of their proposed property taxes.  He also noted that the TRIM process begins in June each year.

Even though Duke was promoted to Deputy in July, 2015, he had already began the TRIM process and was still managing the budget.

In fact, as Mr. Henley pointed out, at the time of his promotion Duke told the Miami Herald, “I’m still actually at my seat in the budget office working on the budget.”

Mr. Henley further testified that Duke continued preparing the TRIM information even after he was promoted.  He explained, “And then an error occurred where CRA, community redevelopment agency numbers, were not put into the TRIM system. As a result when he submitted, all the property tax numbers — what your proposed property tax numbers were going to be, were incorrect. Then we drafted a letter and he sent it out with his name on it because it was his mistake and his department he was still managing.

And yet, when Duke’s mistake became public, the person he blamed was Terry Henley.

“I’m my own worst critic.”

In our previous installment in this series, we reported that Duke was asked about the “work plan” attached to Terry’s Performance Evaluation Report for the period of July 27, 2016 through July 27, 2017, which was signed by City Manager Larry Spring on March 9, 2018.  Duke responded that the “City Manager issues work plans when people aren’t performing to their level they should be performing to, so to give them a chance, he gives them a work plan and evaluates them on a constant basis.”  He also claimed that not every department head gets a work plan.

Except all of this was complete fiction.

Then Mr. Amlong asked his client if his work plan indicated “Mr. Spring’s dissatisfaction with your performance.”  Mr. Henley responded, “No. I created this work plan myself. Every department head was responsible for having a work plan. You can’t have a performance evaluation without a work plan. This is an initiative that Larry Spring was very proud of that he brought with him from the City of Miami. And so you make your own work plan and you evaluate yourself.”

Mr. Amlong then asked his client why he graded himself “unsatisfactory on cultivating and propelling staff as reflected in performance evaluation.”

Mr. Henley responded, “Yeah. I’m hard on myself. Yeah, I tend to do a lot of the work myself. So I had a staff of two. One I’m very proud of one employee that I’ve really coached him and brought him up and I’m very proud of the work that he’s done. The other I had a very difficult time motivating. And because that employee was not carrying his weight, it caused more pressure on the other analyst who was getting paid 15,000 less than the person sitting across from him who was not performing. However like I talked to Arthur, I said I was forced to hire this individual and I can’t reprimand the individual because I wasn’t allowed to. So I rated myself unsatisfactory because I wasn’t getting the most out of him and it was disappointing that year. The next year with motivation techniques and finding out what motivated the individual, it started to improve, and I rated – my target was to be satisfactory with him next year.

Impressive!

Can anyone here even imagine Duke Sorey admitting he made a mistake, accepting the blame, and taking responsibility for correcting it?

Yeah, neither can we.

Terry Henley went into great detail describing how he planned to further improve his performance.  He explained that as one of seven board members of the Florida Benchmark Consortium, a group of about 50
elite local governments throughout the state, he helped establish performance measures by comparing data from all over the state to create best practices.

We don’t know about you, but we’re certainly impressed.

The Fall Guy

Mr. Amlong then asked Mr. Henley about the time he “sounded the alarm” in August of 2017, when he told Larry Spring and Duke Sorey he was very concerned there would be a budget deficit in the 2017-2018 fiscal year (page 23).  Terry responded, “I sent this email to Arthur Sorey. In the email I show close to a four million dollar deficit and I propose solutions or recommendations. It’s part of my job. I don’t just — I’m not just a monitor. I help fix problems. So I demonstrate here’s the problem, here’s a four million dollar deficit for next year. Here is possible alternative revenue sources and possible items to cut so we are soundly balanced.”

Mr. Henley was referring to his own Exhibit 6, which was the August 27, 2017 email to Duke with his attached plan to balance the budget, making cuts in every department.  He needed this plan since “expenditures increased significantly since Spring got here, but our revenues were the same.”  He warned Spring and Sorey that “expenditures are out-pacing the revenues; we need to make cuts. And I was ignored.”

In response to his warning, Duke told him to plug the budget deficit (page 27 of the transcript) by adding “4.9 million dollars in non-reoccurring revenue” comprised of the $1.9 million Costco buyout and another three million in buyout money.  Henley told Duke that this would only be a temporary solution, using an analogy that if you pawn “grandma’s ring” to make rent one month, but it won’t help pay the rent the following month.  “They’re pawning City land in order to make operations work.  This was a terrible management decision.”

By this time, Sorey and Spring were pressuring Terry Henley to stop calling attention to the budget problems, so Terry began documenting everything that had been transpiring.  On November 14, 2017, he wrote a memorandum on city letterhead, which he signed and had notarized (Henley Exhibit 7), addressed “to whoever is going to read it in the future because I knew this problem was going to come up. Because I was warned by the Chief of Staff and by Arthur himself to look at Larry’s past dealings with budget directors, so I prepared myself” (page 28).

Mr. Henley had more than enough reason to be concerned.  Sorey had already warned him that if anything went wrong, he would be the “fall guy.”

By bringing up Spring’s past, he was referring to an investigation of the City of Miami by the Securities and Exchange Commission during the time Larry Spring was the city’s Chief Financial Officer at the City of Miami.  Of this scandal, the Biscayne Times  reported, “In April, Amlong’s firm secured a $931,587 whistleblower verdict against the City of Miami on behalf of Victor Igwe, the city’s former top auditor.  Igwe alleged he was ousted in retaliation for uncovering shady financial maneuvers and for cooperating with a Securities and Exchange Commission investigation into a 2009 $153 million bond issue.  Subsequent charges led to a fiscal meltdown.  (Spring, who was not charged in the matter, was Miami’s chief financial officer from 2007 to 2011.) The city settled with the SEC for $1 million.”

Furthermore, as VotersOpinion also reported, “In a press release dated July 19, 2013, the United States Securities and Exchange Commission (SEC) announced it had filed charges against the City of Miami and its Budget Director ‘with securities fraud in connection with several municipal bond offerings and other disclosures made to investors.’ After a five year investigation, the SEC determined that then-Budget Director Michael Boudreaux ‘made materially false and misleading statements and omissions’ in order to ‘mask increasing deficits in the General Fund’ when marketing the city’s bond to investors.'”

And as we also reported, “Larry Spring’s involvement in the SEC scandal was certainly no secret when [the North Miami City Council] hired him in August of 2015.  In fact, many believe Spring was the unindicted co-conspirator, letting his former budget director Michael Boudreaux take the fall.”

“Sensitive information”

On August 31, 2017 at 5:30 p.m., Terry received a “verbal instruction” to budget the three million dollar buyout from Sole Mia.  He included that in the memorandum as soon as he received the “verbal instruction” because management doesn’t want “anything electronic” that can be documented. We are warned in staff meetings, “Don’t email us sensitive information. Pick up the phone and call someone.” (page 30).

Sensitive information?  Like anything that might be subject to a public records request?  Interesting, huh?

As a side note, we find it interesting that Duke was able to give a “verbal instruction” at 5:30 p.m. to an employee who always leaves work at 5:00 p.m. according to Duke.  But, that’s just us.

Terry Henley continued testifying that the Costco money was used to balance the budget, despite the fact that “the City Council was expressing some dissatisfaction with the Costco deal and said it did want to use that money” (page 31).

Mr. Henley then said he was offered the job of budget director by then-city manager Aleem Ghany, who told Terry, “Be careful with Arthur.”  He turned down the offer.  In February, 2016 when Larry Spring was offered the job as city manager over Duke Sorey, he was offered the position again, and turned it down again (page 32).

This second offer took place in July, 2016, when Deputy Duke took a three week leave, while being paid a “Training” salary of $19,388.96 on taxpayer dime, and an additional $1,969.47 for his travel, lodging and meals, to attend the Harvard Kennedy School for Executive Education …

A course for which the “incompetent, inefficient and insubordinate” Terry Henley prepared Duke’s application.

So, Terry asked Larry Spring to table his offer, telling him, “Can’t we just make me assistant director and that will be enough?”  Aside from not wanting to step on Duke’s toes, Terry testified he did so ” because being in the financial realm, what that means in North Miami, it can ruin your career. Look at Vernon Paul, former finance director, who blew the whistle on the early retirement incentive plan.”

Mr. Amlong continued by asking his client if he shared his concerns with the City Council about “the plugging of the five million dollar hole with the Sole Mia and the Costco money.”

Terry answered no, even though Duke Sorey had already testified that it was part of his job to do so.  However, he was specifically directed by Larry Spring not discuss this “very sensitive” matter but only to “discuss other revenues.”  When Mr. Amlong asked him why he didn’t do it anyway (page 35), Terry responded, “I can’t go over my boss’s head to the Council. And I’ve seen what happens to former employees that do.”

Gone Missing

Smoke and Mirrors

William Amlong asked his client about the $4.9 million that was used to plug the hole in the budget.  Mr. Henley responded, “Well, the 4.9 million it — the three million from buyout, it never came in. It never materialized. The two million from Costco it did come in, but the Council told the manager to send it back. So really, if we send it back, it’s a five million dollar deficit. And if you keep it, you’re still not allowed to recognize that entire two million. It has to be matured over 99 years. So 1.9 million matured over that time is like 60 something thousand dollars.“

Mr. Henley then went into great detail about the “mechanics” of the budget, and how he calculated the revenues and expenditures, and how he arrived at his final conclusion.

He said, “So you’ll see that these general fund expenses are 63.8 million. And then on the following page you’ll see that the revenues that came in were 59.1 million. The difference is $4,774,496. Almost a 4.8 million dollar deficit that could have been prevented.”

Mr. Amlong reminded his client that Deputy Duke had insisted there was a “7.2 million dollar surplus” (page 37).

“Well,” said Mr. Henley. “Mr. Sorey also said that that surplus was from prior year funding. Prior year funding from the sale of Sole Mia landed 20 million dollars. He also said that that money was already spent. All of it except five million, he said.”

Mr. Amlong asked, So is that 15 million dollars available to spend?”

“No. said Terry.  “No, it’s gone.”

When asked if the finance department was aware of the budget deficit situation, Mr. Henley testified that he had emailed the finance director as well as “a number of department heads.”

“I even gave handouts to the Chief of Staff who couldn’t reproduce the documents. She said they threw them away in the public records request. I also blew the whistle and I alarmed a number of other folks including Joe Roglieri. I gave him handouts. And when he went to do negotiations with the Union, I told him we didn’t have the money. He also could not produce the records that I requested that I handed him that showed a deficit.”

We can only guess how much “sensitive information” was tossed out with those public records.

But we digress.

Mr. Amlong then asked his client to explain the Comprehensive Annual Financial Report, or CAFR (page 39).  In a nutshell, Mr. Henley explained that a CAFR is a document prepared by the finance department and reviewed by external auditors.  When preparing the budget, Mr. Henley explained the finance department tells him where to start by giving him the “Fund balance ending” from the previous year.

Mr. Henley used the deficit of $347,319 from the 2017-2018 fiscal year as a starting point to prepare a balanced budget for the 2018-2019 fiscal year.  The Finance Director, Miguel Augustin, however, told Mr. Henley that even though the CAFR shows that the previous year ended “more than 4.8 million dollars in the hole” (page 40), he waved it away by saying, “It’s because of some accounting entry.”

Mr. Augustin then instructed Terry to change the negative 4.8 to “make the fund balance 2.2 million.”

Like magic.

Referring to a July 25, 2017 email from the finance director, Mr. Henley testified (page 42): “And what he does is he says, “We have a negative $347,000 deficit because of the accounting entry.” Remember the money is spent. So let’s just say that this accounting entry is legitimate. The money is already spent. So if the accounting entry is done this year in 2016, the following year when it’s negative 4.8 million, that can’t be due to the accounting entry again because the accounting entry happened once. It doesn’t — it didn’t happen again. So you can’t blame a budget deficit — the City’s finances, if you look on the website, you can’t blame it on this accounting entry because it happened in 2016. So we went from negative 347,000 in 2016 according to the financial to negative 4.8 million in 2017 financial statements.“

Mr. Henley then prepared and delivered to Duke his reconciliation report, which is a first draft of the 2019-2019 budget.  Mr. Henley testified (page 43) how he arrived at a ten million dollar deficit moving forward by saying, “Given the deficit spending that already occurred this year and last year, and the revenue not coming in from Sole Mia and then having to return the Costco money. So that five million dollar deficit that I report August 27th, I told you it’s that one time plug of that five million it’s going to compound. So it’s become ten. And so I’m warning them early on we need to do something.“

In response, Larry Spring and Duke Sorey did something, all right.

But, as you might expect, it had nothing to do with fixing the real problem.

Killing the Messenger

In our next installment of this series, we’ll illustrate how Spring and Sorey pulled the wool over the eyes of the Mayor and Council to get their fraudulent budget passed … and how they desperately tried to silence Terry Henley, the one person who could expose their treachery.

In the meantime, we find it curious that Terry Henley’s appeal hearing before the North Miami Personnel Board was to be continued on January 31, 2019, and again on and February 11, 2019.

Both were mysteriously cancelled.

Isn’t that interesting?

Stay tuned…

Stephanie