Port official resigns as NBC6 Investigates questions millions in no-bid deals, mismanaged technology, expense report abuses

The cargo side of PortMiami, and its multibillion-dollar impact to the South Florida economy, would be nothing without its cranes.

When a cargo ship is ready to dock, the port relies on a non-profit company it created in 1999, Port of Miami Crane Management Inc. (PMCM), to have the cranes up and running and able to off-load containers – more than one million of them a year, based on a standard industry measurement.

But NBC6 Investigates has obtained two county audits delivered to PortMiami last summer that reveal PMCM has misspent money, mismanaged operations, and failed to keep cranes safe and running.

All that while the only CEO the company has had in its 23 years reaped personal benefits from two business credit cards he used for purchases from merchants and vendors without a formal procurement process, one of the audits concluded.

After declining to answer NBC6 Investigates’ questions for over a week, CEO Aguedo “Ed” Bello submitted his resignation to the chair of the board that oversees PMCM Thursday, one day before NBC6 had previously arranged to interview the chair, PortMiami deputy director of operations Frederick Wong.

“They were alarming as far as some of the identified issues that were revealed in the audit,” Wong said in an interview Friday, four months after receiving the first of two audits by the county’s audit and management services department.

Bello leaves behind a $22 million operation that has been losing shipping container business for three straight years while, currently, the port confirms four of its 13 cranes are shut down from off-loading ships. One of those cranes was slated for demolition and two others were found not “operationally safe” before they were taken offline, as the audit highlighted unresolved “long outstanding deficiencies that were identified up to ten years ago.”

Asked if Bello’s resignation came under pressure from him or anyone else at PortMiami, Wong said, “Separating from (the) company is a personal decision, you know, for him to make.”

The resignation email, he said, “was addressed to me, the chairman of the board, and it was well received.”

While PortMiami’s container volume is down 13% since the 2020-21 fiscal year, Broward County’s Port Everglades has seen a 5% increase over that period, port records show. That means Broward’s port was less than one-tenth of one massive container ship short of surpassing its neighbor to the south in container volume for the just-ended fiscal year.

Wong said that decline in business, costing the Seaport Department more than $4 million in potential revenue if there had been no decrease, cannot be directly linked to the problems with the cranes.

The county, which charges an average $1,000 an hour for shipping companies to use the cranes, is the sole funder of PMCM’s annual budget, currently $22 million.

That includes more than $300,000 for Bellos’ 2023 annual salary and benefits and $10 million more for about 60 employees, according to PMCM’s tax return and budget records. About two-thirds of the employees are members of the International Longshoremen’s Association, mechanics, foremen and operators who must be available at all times to make sure cranes are set up properly and working when ships are due in port, according to the county auditors and a union official who also serves on the PMCM board.

But it was the non-salary expenses and management practices that drew criticism in two county audits delivered to PortMiami director Hydi Webb in August and September.

Among the audits’ findings:

• Goods and services “are consistently procured by PMCM without evidence of competitive bidding,” including a $2.7 million contract Bello approved in December 2023 for crane repairs and refurbishment just two weeks after the contractor, Paceco Momentum, emailed its offer to him (the Seaport Department later discovered the no-bid purchase order and demanded it be cancelled);
• PMCM “mismanaged” another $1.45 million expenditure – also to Paceco Momentum -- beginning in 2019, on technology that was supposed to track crane movements and usage in real-time, but “has not produced any tangible benefit for the operation, maintenance, or ongoing reliability of the cranes” – a finding Paceco and the port dispute;
• PMCM showed “a systemic disregard to establish an effective maintenance reliability program to proactively and timely address deficiencies” and “maintain the cranes,” which is the central responsibility of the company, as required by the agreement with the county;
• Bello used two “personal business credit cards … issued based on the CEO’s personal credit worthiness” for travel and purchases from PMCM merchants and vendors. They had more than $20,000 a month in purchasing power and accumulated rewards, including airline miles, that Bello told auditors “have been used for personal benefit” without disclosing those benefits as gifts, as required by the county;
• Among the charges: $2,935 for just two meals, including $1,883 for four to six unidentified diners at an “upscale Miami Beach restaurant” for what was described as an “employee appreciation luncheon”; $11,882 for computer equipment and software; and $2,364 for 26 guayabera-style shirts embroidered with a port logo, six which were part of a shipment to Brazil that cost an additional $3,086 after it was subjected to tariffs levied by Brazil.

Wong said all of the above is being addressed: “Well, I can assure you, as the board chair, that to prevent this from happening again, we're taking all steps, modifying their policies and procedures that exist now.”

Asked if there would be any more $1,883 dinners, including alcohol, for four to six people, Wong said, “I assure you, that will never happen again with my leadership.”

“After that discovery, we eliminated all credit cards, not only from Ed, but there were approximately six credit cards that we eliminated completely,” Wong said.  “So preventative measures immediately went out, to ensure that there's no interactions with personal accounts at all.”

After receiving the audit, Wong and his fellow board members called a special meeting in November, where Bello and his staff responded, defending some of their actions and agreeing to accept changes in policies and procedures to address other concerns.

Staff also gave an update on the project to repair and refurbish several cranes – essentially the same project Bello tried to award to Paceco Momentum one year earlier without seeking bids, until the Seaport Department says it ordered it scuttled before any work could be done or funds released.

But PMCM also failed to properly conduct the subsequent competitive bidding process PortMiami demanded.

That request for proposals was supposed to close in July, but after bids were submitted PMCM realized it failed to accurately describe the scope of the work (undercounting the number of steel plates that needed work on each crane by 36%), an assistant county attorney told the board. That mistake – and a decision to make one of the five cranes an optional component of the bid – led to all proposals being rejected, and the project had to be re-bid, with proposals now due on January 27, 2025.

NBC6 Investigates attended a December 5 pre-proposal meeting where several potential bidders joined by teleconference, but only one was physically present and able to join in a site visit: the CEO of Paceco Momentum, Miguel Soler.

After taking an elevator and climbing steps to as high as 120 feet above the shipping channel, the PMCM project manager described some of the work needed to bring Crane 5 back to life.

“After you remove the plates, you’re going to clean all the corrosion,” he said, pointing to obvious signs of wear, tear and corrosion. “You bolt it into the plate up here.”

According to the seaport’s response to the audits: Crane 5 and its neighbor Crane 6 were removed from service after engineers would not certify them as operationally safe due, in part, to corrosion; Crane 4 has been shut down for three and a half years and is being recommended for disposal, along with potentially Crane 10, which has not been used since February 2022.

Wong said he “wouldn't categorize” the condition of the cranes as neglect, even though the audit found PMCM did not have a program to maintain and repair them – essentially its one job.

“So as far as policies and procedures,” Wong continued, “I assure you Port of Miami Crane Management, through the board of directors, is establishing policies and procedures to ensure that proper documentation on preventative maintenance and scheduled maintenance is there to be revealed.”

When reminded the audit described two cranes as operating when they were not “operationally safe,” Wong said,  “So when we categorize safe, I would not say that they were unsafe ... I am fully confident that our cranes are safe to operate. We are putting no one in danger at this time. Absolutely not.”

But the corrosion didn't happen overnight, engineers documented, and concerns preceded when Cranes 5 and 6 were taken out of service in August.

 The request for proposals now out for bid includes refurbishments and repairs to Cranes 5, 6, 11 and 12, with an option for Crane 4.

At last month’s special meeting, one board member questioned the wisdom of some of that work.

“The way they are right now, the size they are, how wide they are, even if you fix them, they’re not going to be used that much,” said Richard Rodriguez, vice president of terminal services for Seaboard Marine and county mayor Daniella Levine Cava’s appointee to the board. “So, I think there has to be a more strategic approach here.”

“Just to approve this under false – I don’t want to say false pretenses, but,” Rodriguez continued, “at least knowing that even if it gets approved, even if we spend the money, we’re not going to really use the cranes that much, then we’re just fooling ourselves.”

But the board voted to issue the request for proposals due next month.

Wong said Rodriguez’s concerns were rooted in his company’s operations at the port and that repaired and refurbished cranes would, in fact, be suitable for Seaboard Marine ships.

“Seaboard Marine, they have specific vessels. And his hatch covers, that's what he was referring to,” Wong said. “If it's not modified, then you won't be able to efficiently work two cranes next to each other for the hatch covers. The crane could still work the ship.”

Rodriguez answered a call from NBC6 seeking clarification, said he was in a meeting and would call back, but never did.

Whatever the ultimate scope of work may be, Bello’s resignation, effective January 31, means he will not be in charge for the first time in 23 years.

In his resignation email to Wong, Bello said he’d “been contemplating resigning for years, and now as I have reached my golden years it is time for me to resign and enjoy my years with family.”

Asked again if anyone forced Bello’s resignation, as NBC6 was preparing this report, Wong said, “You know, decisions to retire, life changing decisions like that. That's a personal decision of the CEO.”

But was the decision related to the management issues that were raised in the audit?

“I wouldn't be able to assume,” Wong answered.

Bello’s management had been a target of criticism for many years, but the board – which includes appointees from the port, the mayor, county commission and an association of port employers – continued to keep Bello in power.

Ten years ago, a consultant noted critically “all significant decision making gravitates to the CEO” and that “levels of management responsibility seem to have disappeared,” the audit recounted. “Currently,” it continued, “we observed that most decisions still rely and depend on the CEO.”

Auditors found Bello or his staff have given the board “unclear, unsupported and …incorrect” information about critical items and that Bello’s actions “do not reflect … best practices.” It recommended the seaport “hold PMCM management accountable to ensure information presented to the board on maintenance and reliability activities is accurate, sufficiently detailed and timely.”

As it did with almost all the audit recommendations, the seaport concurred and said it was in the process of making changes to address the audits’ concerns.

Last month the board asked Bello for a succession plan for identifying “new leaders … when key individuals leave or retire,” but there was no indication Bello was planning an imminent departure.

Bello declined repeated requests by email and voicemail for an interview.

As for Paceco Momentum, it’s preparing to bid again on the repair and refurbishment contract, its CEO, Soler, told NBC6 Investigates.  For now, he said, “we are mostly here with software.”

That would be the Paceco Spyder system, which was chosen in 2019 from among six vendors submitting a request for quotes.

The audit found PMCM “mismanaged” the “failed project” that was supposed to produce real-time dashboards relaying crane usage, but which auditors said was largely unused, incompatible with another computer system and “doesn’t work.”

When referred to those portions of the audit, Soler responded, “Obviously, I cannot agree with that one because Spyder is working not only here, and it’s basically used by each terminal in a different way.” He, like PMCM, rejected the auditor’s recommendation that the software and hardware be scrapped, saying in due time it will fully work.

“At this moment it is just at the stage where everything has to be started off and once everything is working and they’re using it the way it was intended to, then it’s the start of interconnecting,” he said.

Wong said while it is not performing all the tasks it was designed to do, he confirmed many of the problems were caused by PMCM not obtaining another computer system that would connect to the Spyder program. 

The audit found, of the $1.45 million in payments to Paceco Momentum since 2019, the largest came in fiscal 2023 when PMCM paid $547,022, including $415,236 to install the Spyder management system on Cranes 4, 5, 6, 7 and 8 – one of which (Crane 4) had already been taken out of service and is now recommended for disposal and two of which (Cranes 5 and 6) were removed from service this year.

The board last month ordered Bello not to spend any more money on the Paceco Spyder system, beyond a $69,000 contractually required maintenance or subscription payment.

As for Bello’s credit card activity over the years, Wong said he did not know how long Bello had been accumulating and receiving personal benefit from rewards, how much money had been charged on the cards and what the cards were used for, beyond what was in the audit.

The board in November demanded Bello submit the county-required gift disclosures describing how much personal benefit, including airline miles, he received from the two business credit cards before the port demanded he surrender them after getting the expense audit findings.

Asked Friday if Bello had submitted the gift disclosure report, Wong said, “Not to this day.”