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Person Of The Year, Public Sector: William Miranda Marin

A vision for the private sector & an emphasis on technology spur the economic and physical development of Caguas


November 28, 2002
Copyright © 2002 CARIBBEAN BUSINESS. All Rights Reserved.

Caguas' image as a modern, buoyant, prosperous, and rapidly growing but orderly city is no accident. Mayor William Miranda Marin's successful endeavors in the private and public sectors, as well as his military experience, have helped him reshape and redefine Caguas, transforming the municipality into a shining example for others to follow.

Since becoming mayor of the island's fifth largest city six years ago, Miranda Marin--a firm believer that government should be a facilitator, not an obstructionist--has set out to make Caguas a business-friendly, high-tech haven for industries, educational institutions, businesses, and new residents, as well as to improve the quality of life of every Cagueño by investing in the city's infrastructure and public services.

Using the most tried-and-true strategies and skills of private-sector entrepreneurship, his management vision, and his organizational skills as a military officer, Miranda Marin has helped Caguas become one of the most prosperous and financially sound municipalities on the island.

The city has been recognized by the Comptroller's Office for meeting 100% of its established requirements for the good use of public funds.

The Environmental Quality Board recently named Caguas the island's cleanest city.

Despite the local, stateside, and global weak economy, the municipality of Caguas was able to close fiscal year (FY) 2002 with a $3.8 million surplus.

This is the fifth consecutive time Caguas has closed its fiscal year, which runs from July 1 to June 30, with a surplus. At the core of Miranda Marin's success as mayor are the city's dynamic economic development, infrastructure, public safety, social development, and recreational programs, which are run by a group of dedicated public-sector professionals who operate the city like a private corporation, with Miranda Marin firmly at the helm.

Miranda Marin's past and current achievements have earned him the distinction of being voted CARIBBEAN BUSINESS Public Sector Person of the Year for 2002.

This is the second year in a row a mayor has been so recognized. Last year the honor went to Guaynabo Mayor Hector O'Neill.

Fiscally sound

According to the city's financial report, Caguas' operational income at the close of FY 2002 was $74.6 million, a 9.2% increase over FY 2001's $68.3 million.

Meanwhile, Caguas' expenditures reached $70.8 million, resulting in a $3.8 million surplus for FY 2002.

"This was achieved despite the dramatic drop in interest rates as a result of the events that followed 9/11, which impacted the financial markets," Miranda Marin told CARIBBEAN BUSINESS.

The effect of 9/11 on the city's finances, Miranda Marin said, was practically eliminated with the $2 million increase in collections from municipal business licenses (patentes) and revenues from construction excise taxes. Caguas' patentes collections jumped from $18.6 million in FY 2001 to $19.6 million in FY 2002, while construction excise taxes increased from $3.5 million to $4.5 million during the same period.

The city's nonexempt property value reached $844 million, a $61 million

increase over the previous fiscal year. The leasing of municipal property for public or private use provided $793,000 in revenues for the city during FY 2002.

In June, Caguas obtained the island's first operational financing through bids, or public sale. This method allowed the city to secure a $22.6 million loan at 6.4%, the lowest interest rate offered to a municipality at the time. With the loan, the city was able to refinance its operational public debt of $6.9 million, improving its cash flow by $2 million during the next six years.

City investments

In the area of economic development, Caguas has invested $2.8 million to, among other purposes, strengthen the city's ties with the Caguas-Guayama consortium and with other strategic allies such as universities and colleges. The consortium invested $20.6 million in the region, of which $5.1 million was for services to 6,145 Caguas residents.

During the past six years, the city has invested millions in its urban center, including parking facilities, a civic and performing arts center, stores, museums, restaurants, outdoor cafes, and more. Additionally, Miranda Marin is going forward with millions of dollars more in other projects. These include creating affordable housing, building a new city hall, restoring historic buildings, and developing new cultural and recreational attractions.

The city recently invested $300,000 in a promotional campaign for its urban center, to revitalize the economic, tourism, and commercial activities around the city's downtown area.

The city continued to help facilitate the construction of two hotel facilities with a private-sector investment of $30 million. The 125-room Hampton Inn, in the city's south, will open Feb. 15 and will include an 18-hole golf course and a family-style restaurant.

Caguas is also working on the viability of additional office complexes, such as the $15 million Las Catalinas Office Park, as well as on the construction of several master-planned communities and single-family home projects.

The city's Entrepreneurial Assistance Center (Casem by its Spanish acronym)--a joint venture between the city, the Puerto Rico Small Business Development Center, and Columbia University--has provided training or other assistance to over 1,000 small and midsize businesses, mostly downtown merchants.

Added attractions

The Caguas Tourism Office provided orientation, tours, and other services to nearly 7,000 visitors, tourists, and residents last year. The city recently opened its fourth museum, the Caguas Historical Museum at City Hall. It also has a tobacco museum, an art museum, and a music museum.

Trolley routes were reconfigured, now stopping at the major parking facilities downtown and with fewer interruptions. New tourist and commercial signs are being installed as well.

New commercial spaces, in the form of 10 removable kiosks, plus two permanent ones were added to the city's main plazas so entrepreneurs can sell their goods. A promotional campaign, including a business directory, tourist maps, posters, and bumper stickers, was developed to attract local residents and visitors who enjoy shopping at urban centers.

To boost consumer traffic in the downtown area, the city has coordinated a calendar full of artistic, cultural, and recreational events for residents and visitors alike. Events take place every weekend at the vast Plaza Palmer.

Caguas Performing Arts Center was reinaugurated last month, after a $7 million reconfiguration. It now boasts 1,891 seats--more than Santurce's Luis A. Ferre and Guaynabo's performing arts centers.

Creating and retaining jobs

The Caguas Economic Development Office provided exemption decrees which helped save over 1,500 jobs and create about 500 new posts.

Decrees for Pharmacia alone, for instance, helped retain 1,058 jobs and create 27 job openings.

The city's multimanufacturing, emerging business (incubator) facility, inaugurated in September 2001, has an occupancy rate of 75% thanks to three lease contracts that have so far generated 70 new jobs and $115,000 in additional revenue to the city. Negotiations are underway for a fourth contract, which would bring the incubator's occupancy rate to 100%.

The Caguas Community Development Bank reported its financial situation for the first time this year. Assets grew by more than $1 million, bringing the total to $3.4 million. During FY 2002 the bank provided $986,000 in home loans and another $145,000 in commercial loans, which resulted in 20 new jobs and helped retain 13 positions.

Interestingly, Caguas was the first city to have its own development bank. Carolina recently emulated the move, using Caguas' success formula as an example.

Infrastructure projects

One of the biggest commitments Miranda Marin made when elected mayor in 1995 was to provide every family in Caguas with a reliable water supply. The mayor doesn't take all the credit for fulfilling that promise.

"The fact is that once the Superaqueduct project was completed, our water shortage problem was solved," he said. Nevertheless, the municipality chipped in with infrastructure investment of its own, such as a $3 million water filtration plant, a $5 million water system reconstruction project in the Tomas de Castro sector, and $2.3 million for the water system in the Salvador sector.

In FY 2002, the city invested $19.3 million in capital improvements, which included repavement and upgrades to the city's main avenues and to several recreational facilities. The city's Public Works Department completed the construction of several projects under its master road network plan. When completed, the plan will total $25 million in roadwork projects.

The city is currently developing a $7.5 million, 157.3-acre ecological corridor project involving the Caguitas River and the Aguas Buenas Caves system. The complex will include the Criollo Park and Botanical Gardens complex. The Botanical Gardens will have trails along the Algarrobo Creek, with an impact on only 3% of the land. The remaining 97% will be preserved and returned to its natural state.

The Caguas mayor is in negotiations with a French firm to construct a $250 million light rail system between Caguas and San Juan, which would connect to the Urban Train station in Cupey. Additionally, Miranda Marin is still hopeful his proposal for a $450 million waste-to-energy plant in the city can be built in the near future, once the financial hurdles are overcome.

Safer city

Miranda Marin's efforts in the areas of public safety and crime prevention have made Caguas the island's safest city. In fact, the city reported 9.9% fewer burglary cases and a 40% reduction in homicide cases during FY 2002. The Caguas Community Police increased crime prevention efforts by implementing a pilot plan involving the installation of 30 video cameras in public areas.

The Caguas Community Police also intervened with 238 homeless people and drug addicts, referring 200 of them for psychiatric and psychological treatment. Additionally, the city police got approval for five federal proposals for $3.8 million for equipment, vehicles, and personnel.

Emphasis on technology use, educated work force

For Caguas Mayor William Miranda Marin, what will propel his city--and therefore the rest of the island--is an emphasis on technology as a tool for economic development and job creation, as has been done in Singapore, Taiwan, and Ireland.

According to the second-term mayor, the current economic cycle from information technology is expected to reach its peak in 2010. If the island isn't ready by then, it will miss the next economic cycle from biotechnology.

"Many industries are already positioning themselves for when this happens," said Miranda Marin. "I have been moving the city's resources to create the conditions so we are prepared to gain the most from this new economic cycle."

Cities and nations rise, among other things, from having a strong base in technical and professional areas, the mayor said. Since taking over as Caguas' mayor six years ago, Miranda Marin has emphasized training the work force for careers in those areas. To that end, Caguas and several post-secondary educational institutions in the area, including MecTech, Huertas College, and Columbia University, formed a council to promote high-tech education in the city. When student funds were endangered, the council pitched in and created a $250,000 fund to help high-tech students complete their education.

"The fund enabled us to guarantee up to $3 million in loans through Eurobank," said Miranda Marin. "This helped create a propitious environment among these institutions, which began expanding and updating their offerings."

Today, MecTech trains the mechanics of most local auto repair shops, such as Pep Boys, Chrysler, Bella International Corp., and General Motors, said Miranda Marin. He noted the institution specialized in auto repair training started it all in Caguas and now has successful operations in Mayaguez and Bayamon with plans to open in Vega Baja and Ponce.

The city has also been successful in attracting several technology-based firms, including Vernet, MTS, and Avant Technologies, into its emerging-business incubator facility. This, in turn, has enticed telecom companies such as Centennial to install fiber-optic cabling throughout the city, providing broadband (high speed) Internet and telecommunications services.

Caguas itself has invested $6 million during the past five years in an intranet and is moving to have all information pertaining to the city online. Last year the city responded to 63,000 service information requests from students and teachers and offered short courses promoting Internet use to the general public.

"The tools we are developing will allow a person to access all the information needed about Caguas online," the mayor said. "There's no question technology is impacting all human activity in a dramatic way."

Caguas has also formed alliances with Microsoft and Centennial to reduce the cost of bringing technology to the city and has joined a consortium called Inteco (the Spanish acronym for the Eastern-Central Technological Initiative) to enable the city, together with the private sector and academia, to develop a science and technology-based economic development program for the region.

"We must stop the political bickering and our tendency to reinvent our economic development strategy every four years or every time there's a political change. We have to start thinking long-term and set clear goals. If Caguas can do it, so can other cities and the central government. It is doable. All it takes is political will," Miranda Marin said.

The mayor suggested that just as the Puerto Rico government has allocated $1 billion for the special communities, it can raise $600 million for a technology fund to create jobs and promote economic activity.

"The two go hand in hand," Miranda Marin said.

William Miranda Marin: The Caguas native has served Puerto Rico for more than 30 years, excelling in government and in the private sector

Mayor of Caguas William Miranda Marin represents a generation of young Puerto Ricans who forged ahead through their own efforts during the social and economic revolution launched by the late Gov. Luis Muñoz Marin.

The son of Jose Miranda Gomez, a sugar cane cutter, and Rafaela Marin, a tobacco stripper, Miranda Marin was born in the Tomas de Castro sector of rural Caguas on Sept. 23, 1940.

Miranda Marin graduated from Jose Gautier Benitez High School in Caguas in 1957. Four years later he earned a bachelor's degree in business administration from the University of Puerto Rico (UPR), majoring in accounting. In 1969 he completed his law degree at UPR and was admitted to the bar in 1970.

During more than 30 years of service to Puerto Rico, Miranda Marin has held some important positions in the Commonwealth of Puerto Rico and in the private sector.

In the public sector, he has served as executive vice president of the Government Development Bank (1973-1975), as executive director of the Puerto Rico Electric Power Authority (1975-1979), and as Adjutant General of the Puerto Rico National Guard with the rank of major general (1990-1992). While commanding the National Guard, he also served as executive director of the Office for Improvement of the Public Schools of Puerto Rico (1990-1992).

In the private sector, he has held top positions at both Empresas Diaz and the San Juan Cement Co. (1979-1990), among them treasurer, executive vice president & co-chairman of the board. Before seeking public office for the first time in 1996, he devoted three years to housing and commercial development.

On Jan. 13, 1997, Miranda Marin became mayor of Caguas, Puerto Rico's fifth largest city.

Since then he has become one of the island's leading municipal executives, modernizing public administration in the city of Caguas, improving the infrastructure, and sponsoring innovative service programs. In November 2000 Miranda Marin was re-elected to a second term, capturing nearly 55% of the vote.

A lifelong advocate of civic and voluntary endeavors, Miranda Marin has served as member and treasurer of the board of the Puerto Rico Health Services Corp., as chairman of the board of San Juan Children's Choir, and as chairman of the board of the Community Services Institute, which seeks to eradicate social conditions that contribute to poverty.

In 1996, Miranda Marin and wife Carmen Sara Torres created a foundation, to which they transferred a substantial portion of their assets, to support value-added activities for socially and economically disadvantaged children.

Besides serving as chairman of the Caguas Municipal Committee of the Popular Democratic Party (PDP), Miranda Marin has held or holds numerous other important political positions in Puerto Rico and in the States.

He has been chairman of the Democratic Party of the Commonwealth of Puerto Rico, secretary-general of the PDP, chairman of the PDP Status Commission, and president of the Puerto Rico Mayors Association. He is now chairman of the board of the Municipal Revenue Collections Center (CRIM by its Spanish acronym).

Miranda Marin and his wife have three children: William Edgardo, Luis Alexander, and Jose Juan.

This Caribbean Business article appears courtesy of Casiano Communications.
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