MINUTES OF MEETING

PORT OF THE ISLANDS

COMMUNITY IMPROVEMENT DISTRICT

 

 

            The regular meeting of the Board of Supervisors of the Port of the Islands Community Improvement District was held on Friday, July 13, 2007 at 10:00 a.m. in the Egret Room, 25000 Tamiami Trail, Naples, Florida.

 

            Present and constituting a quorum were:

 

            Ted Bissell                                                        Chairman

            Dale Lambert                                                   Vice Chairman

            Norine Dillon                                                    Secretary

            Richard Gatti                                                    Assistant Secretary

            Richard Ziko                                                    Assistant Secretary

 

            Also present were:

 

            Calvin Teague                                                   District Manager

            Dan Cox                                                          Attorney

            Ron Benson                                                      Engineer

            Robert Edge                                                     Field Operator

            Tom Mack                                                       Staff

            Emilio Rodriguez                                               Isles of Capri Fire Department

            Alan McLaughlin                                              Ochopee Fire Department

            Martin Ortiz                                                      Lykins-Signtek

            C.R. Custer                                                      Resident

            George Kramer                                                Resident

            Duane Otto                                                      Resident

            Kay Otto                                                          Resident

            Tom Weis                                                        Resident

 

 

FIRST ORDER OF BUSINESS                               Roll Call

            Mr. Bissell called the meeting to order and Mr. Teague called the roll.

 

FOURTH ORDER OF BUSINESS                          Attorney’s Report – Discussion of Purchase of Fire Station

            Mr. Bissell stated Mr. Mack and a couple of members of the fire department wish to make a presentation.

            Mr. Mack stated Mr. Rodriguez from the Isles of Capri Fire Department and Mr. McLaughlin, the Acting Fire Chief are in attendance.  We wish to discuss the issue of the fire station purchase.  Since we have been delayed until January 2008, I want to discuss the idea of leasing this land back to them if we can possibly acquire this land with a payment over 30 years.  I hope this is possible, which is why I need to get Mr. Cox’ input and see what is going on.

            Ms. Dillon asked what kind of a commitment letter will we be able to get from the county which says they will pay for it?

            Mr. Mack responded they will want to discuss POI’s budgeting parameters.

            Mr. McLaughlin stated we were told Chief Wilson will not be coming back.  Therefore, I will probably become Chief and Chief Rodriguez was my supervisor for the last five years.  We are actually looking to consolidate the Isles of Capri, and Ochopee in the management realm as opposed to the District realm in order to reduce overhead costs to the taxpayers on both sides.  It does not make sense to create another position if it is not necessary because we can certainly operate a 27-man department easily.  In this context, we have known this for a long time and we have not talked to Chief Wilson, but I believe you compromised two years ago because of the population in the city of Chokoloskee.  We can build a facility out here.  I am sure you heard of the AIUR Committee which determines these issues.  They look at call bonds, but the fire entity does not look at call bonds, but looks at population potential.  Since we have a greater population, services must be provided.  There are a couple of things we are doing to offset this and I am going to give you a quick background on what has been done for the past six weeks.  We are currently working on a Recovery Ordinance for I-75 and U.S. 41.  There are several counties in the state who have already done this.  The population here is paying the tax base for service to respond 50 to 100 miles, three to four times per day.  Fuel, equipment and labor costs will be billed toward recovery which will be beneficial to the taxpayer.  This allows us to cover it by billing their insurance companies since there is no reason the tax base should pay for the interstate traffic, even though we have a responsibility to respond there.  Although it is a catch-22, we now have the ability to recover those funds back into the District.  Chief Rodriguez and I have dealt with boat issues for many years.  His boat was spotted all over the county and he has the most boat calls in the county.  We will work on this with the county over the next two months and bring money back into this budget.  I spoke to Mr. Mack about this, there has been discussion with regards to building something for $600,000 and we had to take this out of our budget over three years from the I-75 station which could not be justified.  The AIU wanted to take it out for the next five years, which I refused.  We put it back in for three years since it is going to be here anyway.  I told them I can put a building and a truck there immediately which they agreed to.  They said they will give me $156,000 in impact fees for a double-wide trailer and concrete cover which is considered a temporary facility as long as it takes to get the funds to build one.  Fire departments are doing this all over the country in order to provide protection.  It is a cost- efficient way to put in a temporary facility.  There is no reason it could not have been done two years ago because there was a property available to do so.  Our current issue is manpower.  We are not certain how this tax reform is going to impact us.  We may have to use a special assessment in order to offset the impact.  We are looking at all of these options to ensure we can provide protection.  We want to ensure we have manpower of three and two in this District.  Manpower impacts the national standards for firefighter safety, and we are trying to manage a budget which is feasible.  The issue right now is the property with the county.  From what Mr. Mack said, there is more than $600,000 in the budget for this property.  The budget is at 5% and we lost $190,000 because the Board of Commissioners told us we could use a budget at 6%, but there is still enough money for impact fees in order to put a building on the property.  A 30-year note is a feasible way to accomplish this.  There is enough in the reserves to pay this for the next three years.  It is a feasible way to provide a property and get protection out here.

            Ms. Dillon asked is there any other area asked to purchase the land for a fire station?

            Mr. McLaughlin responded not that I am aware of.

            Mr. Rodriguez stated when you have a development this size come up for a PUD, the fire department will allow the developer to build there, but you need to set aside 1½ acres for an emergency services facility.  We do not know what happened when this area decided to build.  Although I do not want to say the fire department dropped the ball, apparently these new developments should have been addressed at the time with the developers that it was acceptable to build all of these homes and condominiums only if 1½ acres was set aside for emergency services as part of the stipulation for a PUD.  Since this did not happen, we now have a situation in which the department does not have enough money to purchase the land because of the tax cuts which are being brought to all emergency services throughout Florida by our Governor, and again in January in which we are all going to vote for another tax cut, which will cause all emergency services to cut back on their budget again.  We are here to determine whether or not you can purchase the land after which we will lease it back from you for the amount you are paying over 30 years, making it easier for the fire district to place a temporary facility since there is money in the budget to do so.  We have the trucks and resources to do this.  The only other issue we have to deal with is manpower.  We may be able to do a manpower swap with DMF and actually have an ALS engine here, which means we get a paramedic from EMS as a Paramedic Firefighter and we provide a firefighter EMT from our fire department.  We have an ALS engine which is equipped with advanced life support almost like having an ambulance with the exception of them being able to transport.

            Mr. Lambert asked will we definitely have EMS-qualified people out here?

            Mr. Rodriguez responded you will have firefighter EMTs equipped with basic life support.

            Mr. Lambert stated I am concerned in the event someone has a heart attack.

            Mr. McLaughlin stated 80% percent of the calls are medical-related and 20% are fire-related.

            Ms. Dillon stated if you have $4,000 per month for leasing in the budget, perhaps the county can get a loan from a bank to purchase a property and pay it off monthly.

            Mr. McLaughlin stated I cannot comment because I do not have any supporting information to give you.

            Mr. Rodriguez stated we are also looking at a timeline.  We basically completed the entire budget for Collier County, and our budgets are already in place and ready to be implemented on October 1st.  Therefore, it is almost going to be impossible for us to go back to the county now and ask them to change the budget in order to try to finance the purchase of this land.

T          Mr. Bissell stated there will be another development to the northeast of here at the location of the old trailer.

            Mr. McLaughlin stated since the PUD has not gone through yet, I went to the Bar Code Official’s office and left a note which said, if this PUD comes through we must review it because if we do not have a property we will require them to give us one for development.

            Mr. Lambert stated the site plan for fire was signed off for Orchid Cove.

            Mr. Rodriguez stated this was signed off by the previous administration.

            Mr. McLaughlin stated we have only been here for six weeks.

            Mr. Rodriguez stated we want to try to resolve the problem now.  I have been with the Isles of Capri for 19 years and we are aware there is a problem here; we know there is a need here; and we have the resources to put a truck and a trailer here.  However, we do not have the resources for land to put the trailer on.

            Mr. Gatti stated I wonder if it is necessary for us to own the land for a temporary facility.  Can we make the land available to you for three or four years and use it recognizing it is a temporary facility?

            Mr. Mack responded you will eventually need a permanent place or they will not reduce your taxes.

            Mr. Gatti asked are you certain of this?

            Mr. Mack responded I do not believe the fire department will commit to a three-year contract.

            Mr. Rodriguez stated I want to speak for the county without getting legally involved, but I do not believe the county will put up a temporary facility for a three-year period.

            Mr. Gatti stated I want to go back to the concept of a temporary facility.  We recognize we are going to have to build a fire station sometime in the future.  Until such time as we obtain a parcel of land in which to build it, perhaps we can do something temporary.

            Mr. Mack stated the owner we have a commitment to does not want to lease the land, as I already approached him on this a couple of years ago.

            Mr. Gatti stated I think there is a difference between the commitment we will be willing to make in terms of leasing the property for 10 years as opposed to purchasing it.

            Mr. Mack stated he was not interested in leasing it.  He was interested in selling when I spoke to him.

            Mr. Gatti stated I am just thinking about the temporary aspect of this, and perhaps we can work this out.

            Mr. Ziko asked are we only allowed to borrow money for five years?

            Mr. Cox responded I have been making a lot of notes.

            Mr. Ziko stated we are going to be stuck for 25 years.

            Mr. Cox stated I basically went through all of my notes along with the different questions you had in order to advise you in the right direction.

            Mr. Ziko asked what are the chances of the fire department paying off the lease in five years as opposed to 30 years if we have to purchase a parcel of property?

            Mr. Rodriguez responded this is occurring at a time in which the budgets are actually done for the county.  Therefore, going back to the county in order to change the budget which was already presented to the Board of Collier County Commissioners for approval is going to be extremely difficult at this point since our budget starts on October 1st.

            Mr. Ziko stated I cannot speak for the rest of the Board, but I believe this Fiscal Year has gone by the wayside and we do not have an opportunity because of what you have done with your budget.  Therefore, we should start working on next year.

            Mr. Mack stated we are not certain how much it is going to cost us.  They may have enough money in the budget to cover the cost of the land if you know what the monthly cost is going to be.

            Mr. Lambert asked can you put up a temporary station within two months if we close on the property today?

            Mr. Rodriguez responded we cannot give you a timeframe since we will have to get three bids for a trailer.

            Mr. Lambert stated the funds are available to put up a temporary station in this fiscal year coming up.

            Mr. McLaughlin stated you must remember you are dealing with property preparation and septic sewer issues.

            Mr. Rodriguez stated you have permitting issues and we also have to go in front of the Board of Collier County Commissioners, all of which is going to take some time.

            Ms. Dillon stated it is probably going to take one year anyway.

            Mr. Rodriguez stated I am not certain it will take one year, but everything for the Board of Collier County Commissioners is done in a timeframe and executive summaries will have to be presented to the Board among other things.  Therefore, it may take up to six months.

            Mr. Lambert stated it will probably take one year even if we purchase the property today.

            Mr. Rodriguez stated we will try everything within our power to walk things through knowing you have a Commissioner in this District in agreement with this.  Therefore, the political assistance can probably move things quicker, but we are not certain how quick we can move it.

            Mr. Bissell asked what is the status of the PUD for the north property?

            Mr. Rodriguez responded it did not come in yet.  There is a note at the Bar Code Official’s office for them to contact Mr. McLaughlin as soon as it comes in.

            Ms. Dillon stated there is an area at the property 12’ from the river which he supposedly does not own.

            Mr. Mack stated I was told this was resolved.

            Ms. Dillon stated he had to purchase it from the county.

            Mr. Bissell stated the conversation always seems to go back to purchasing his property.

            Mr. Mack stated I believe this may take two to three years.

            Mr. Cox stated it depends upon whether or not they are going to do anything with the wetlands, which is a major issue.  If they are going to alter any of the wetlands they will have to obtain DEP and CORE permits, which is a 1½ year process.  Therefore, it will probably take eight to 10 months, or one year if the process is straightforward.  You may have to determine whether or not there is any impact of use for the property, in which case you will have to obtain a PUD, which opens the door for the county to obtain a set aside.  With regards to putting in a temporary trailer, we must get DEP approval for conditional use of the fire station as well as a temporary structure conditional use.  I am concerned about any restrictive covenants from the property owners and whether or not they will allow a temporary structure and whether or not they are on governmental property.  Much of their capital improvement can be funded through the impact fee issue.  You must determine whether or not this constitutes a legitimate use of impact fees.  I am aware you were considering approximately $150,000 with a five-year or 30-year amortization and note.  If you go beyond five years it can be done, but it must go through validation, in which we file a complaint to the state saying we incurred debt for a public purpose; we are going to fund the repayment of the debt which is legitimate because it is presented before a judge.  If no one challenges the judge’s ruling, they can never question whether or not the debt is legitimate for this local government and whether or not the method of repayment is appropriate.

            Mr. Ziko stated we can get something from the fire district guaranteeing these payments.  After three years we may have to look at this again.  If we obtain a 15-year loan and after three years the fire district tells us they do not have any money in the budget, what happens?

            Mr. Rodriguez responded we will only go into a contract with you for a long term, possibly 30 years.  Has this hotel provided a room for the firefighters?

            Mr. Cox stated I do not see this happening since there are certain issues which are going through changes and reiterations.  The general purpose local government collects their money mainly through ad valorem taxes and has a petition under the state constitution which established a law stating the debt to income ratio must be within certain limits.  The county will probably hesitate to loan us this small amount since capital infrastructure needs to be elsewhere in the bonding.

            Mr. Rodriguez stated since we are not a General Fund department, we do not fall under the same county guidelines.  This District is strictly an MSPU formed under the Board of Collier County Commissioners, and all money which is collected from the District remains in the District.

            Mr. Cox stated it is an MSPU, which is a taxing unit carrying the same restriction of PUD.  Do you have any bonded debt?

            Mr. Rodriguez responded we do not.

            Mr. Cox stated we can possibly look into funding it through an interlocal agreement since other properties around here are going to be involved.  Their issue is acquiring the property and there are some additional funding sources which can be looked at.  USDA Rule Development has programs for funding capital infrastructure for rural communities in need of essential services without supporting future development.  which you may qualify for.  They also have grants and loans, but the grant to loan is based on community need.  Therefore, you will probably be in a loan category, but you may be able to get a grant if we can show this station is servicing Goodland and Ochopee, which has lower income populations and are traditionally served from the outside.  I believe we should fund the land since this entire development was built prior to any of these actions.  The developer may have been forced to do this if his project was being approved now.  You are looking at $565,000 for the land we discussed, which probably includes everything and your building was probably going to be approximately $700,000 along with the manpower.

            Mr. Rodriguez stated I believe you can ask for more for the number you are looking at for a permanent facility.

            Mr. Ziko asked who pays for this?

            Mr. Rodriguez responded this will come out of the Fire District.

            Mr. Ziko asked will we have any ties to this?

            Mr. Rodriguez responded no.

            Mr. Cox stated you have the ability under your charters to fund construction and operation of our facility.

            Ms. Dillon asked can we do this?

            Mr. Cox responded it is a business decision which has to be made.  You lay out the pros and cons and I am telling you what you can do.

            Mr. Ziko asked can we absolve ourselves from the Fire District if we are paying for this?

            Mr. Cox responded you are not funding it for taxes, but through special assessments.  It is not a double taxation issue, but you are being assessed for something which is providing a certain benefit which does take time.

            Mr. Ziko stated we are in a fire district in which we are paying the highest rate in the county but receiving the least service.  If we can run our own fire station can we get the tax money refunded to do this?

            Mr. Cox responded your cost benefit analysis for ad valorem taxation does not apply because this tax is a general obligation to fund the general operations of a community, and there are no benefits afforded to you from taxation.

            Mr. Ziko asked why should we consider running a fire station?

            Mr. Cox responded this is a business decision you are able to make.  My job is to give you your options and your job is to debate it among yourselves and establish what should be done.

            Ms. Dillon asked is the USDA part of the federal government?

            Mr. Cox responded that is correct.

            Mr. Mack asked what about commercial paper?

            Mr. Cox responded although this can be done, if it extends beyond five years I must validate it.

            Mr. Mack stated we have to validate all loans.

            Mr. Cox stated a couple of issues come into play if you go beyond three years.  First of all, we charge $25,000 to prepare a validation complaint on a typical issue, which is expensive and time consuming.  The noticed public hearing and validation process will take as long as it takes for them to prepare their SDP for bidding.  If we ran it concurrently, you are looking at a little more than one year before all of the intricate financing is in place to proceed.  We can get the land secured and go through the validation process with a five-year bond and fixation note from SunTrust, or we can go through the validation for long-term financing for up to 30 years.

            Mr. Teague stated your existing debt is at 9%, which is a high rate.  However, it does not make sense to refund it based on the interest savings since it is only for three years, but extending the term and withdrawing cash may be more reasonable and you will actually increase the debt.

            Mr. Ziko asked do you believe Allstate will agree to this?

            Mr. Teague responded you must recall this bond and issue a new one.

            Mr. Cox asked what is your remaining debt service?

Mr. Teague responded there is a principal of $550,000.

            Mr. Cox stated we are really cutting it close in order to make this feasible.  By withdrawing an additional $600,000 to purchase the land along with the $1.1 Million, you must include the cost of issuance as well as underwriter’s fees among other things.

            Mr. Teague stated you have $100,000 in interest due which you will be able to reduce in order to realize the savings.

            Mr. Ziko stated all of this is still contingent upon a commitment from the county.

            Mr. Rodriguez stated I recommend the Board write a letter to our supervisor, Mr. Dan Summers and copy the Fire Commissioner giving them a couple of options on the purchase of this land.  The first option will be for the District to purchase the land and secure it for five years, after which the county will take over the note and assume or refinance it.  The second option is for the county to purchase the land altogether.  Allowing them these options will give them the opportunity to come back with something in writing which states, we currently do not have the money to purchase the land, but if the District purchases the land for us we will make those payments for the next five years, after which the Ochopee Fire Rescue District will take over the remainder of the loan, refinance it or do whatever is necessary for the county to take the loan over.

            Mr. Mack stated the county made this commitment in order to ensure we are not stuck in five years.

            Mr. Rodriguez stated giving a couple of options in writing gives them the opportunity to determine whether or not this is feasible.

            Mr. Cox stated I represent general purpose local government as well as special purpose governments such as this.  General purpose government prohibits pledging of non ad valorem taxation without a referendum of others.  Therefore, if they put themselves in an iron-clad, no way out obligation to purchase or expend money, they pledge non ad valorem tax revenue indirectly in order to leave themselves a way out.

            Mr. Ziko stated I want to try to leave a way out for us.

            Mr. Cox stated our commitment expires next Friday.

            Mr. Lambert stated if it is going to cost approximately $565,000 to purchase the property, and we have 1,032 ERCs out here, it amounts to $565 for an ERC after which we will own the property free and clear.  Do we have the ability to assess the property owners?

            Mr. Cox responded you have this ability, and I will explain how we will have to collect the money.  If you authorize this transaction, we will have to send a written notice to everyone owning property within the boundaries of the District explaining the project we are proposing to do, the estimated cost as well as how we plan to collect the money.  We will have to hold a series of public hearings in which certain decisions need to be made.  First of all, it must be determined whether or not the project should be undertaken.  In order to determine whether or not it is appropriately-funded, a validation hearing for the levy of special assessments must be held, after which you must determine how the amount is going to be assessed against each property fairly and reasonably to meet the benefit as well as how it is going to be collected.  You can include it on the tax roll as is done for our assessments through an agreement with the tax collector or you can bill the property owners directly, which may be beneficial since you can send them a bill and they can choose whether to pay it off in full or amortize it over a period of time.  If most people choose to pay it off in full, a large amount of your money will come back to you up front.  Those who choose to amortize will have to pay in full by March.  There may be some people who choose to not to pay, which case we could not bring them to foreclosure until March 2009.  In order to put it on the tax roll, you must have a contract in place with the tax collector.  It cannot be put on the tax roll for this year because an agreement will already have to be in place for this special assessment.  If you need a new special assessment, you must go through the process of obtaining a new contract with the property appraiser and tax collector in order to utilize the alternative method of collection.  You are looking at October 2008 in order to include it on the tax bill, and you will collect most of your money in December, January and February, after which you will have to wait until the tax certificate sale in May in order to collect the balance.  If you choose to finance this through a special assessment, you must come up with the funds up front during the first year of payment on this SunTrust note through existing money.

            Mr. Teague asked is it possible to get it on the tax roll for this year if we agreed to a special assessment today?

            Mr. Cox responded in order to use the alternative method of collection, you must have a separate agreement with the tax collector for each special assessment which is levied.  We did all of our assessments at the beginning for maintenance operations and debt service on the same agreement which has been in place.  We will have to amend the agreement to include the fire station special assessment, which I believe must be done in January.

            Mr. Rodriguez stated we met yesterday with an organization which specifically deals with special assessments, and they are currently doing a one for Marco Island Fire Rescue.  This organization already has special assessments for many fire districts throughout the state of Florida in place.  Perhaps you can contact the individual from this organization and she can explain the details.

            Mr. Cox stated this is what I do.

            Mr. Rodriguez stated this company specifically handles special assessments for fire departments and is familiar with you are going through right now.

            Ms. Dillon stated I am in favor of sending a letter to Mr. Summers, Mr. Colletta and anyone else you believe should receive it asking for a reasonable answer within a short timeframe because we cannot do anything unless we get a commitment from the county.  I do not want to purchase this property and I believe the rest of the Board agrees with me until this happens.

            Mr. Cox stated in order to put this on the tax roll, you will have to adopt a resolution by January 1, 2008 and get a commitment from the property appraiser by March 1st of the year preceding the October you put it on the tax roll.  This reflects the timing of when you can collect the money.

            Mr. Ziko asked can we spread this assessment out over three or four years as opposed to increasing the residents’ tax bill by an additional $500?

            Mr. Cox responded you must give them the option of spreading it out over a period of time.  You can also give them the option of paying up front in order to avoid the interest.  If it is not being amortized, it can be considered a sum savings thereby decreasing your overall assessments.

            Mr. McLaughlin stated we recommend you write the letter which was discussed and allow the county to purchase the property which will take you out of the loop in order to resolve this.  Once this is resolved and the county purchases it, we will deal with the further issues involved especially since the property is available for purchase.

            Mr. Bissell asked will the 4% actually decrease?

            Mr. McLaughlin asked are you referring to the millage rate?

            Mr. Bissell responded that is correct.

            Mr. McLaughlin stated the millage rate decreased 3% with this tax reform.

            Mr. Gatti asked did it decrease to 3% or by 3%?

            Mr. Rodriguez responded we had to roll back the taxes to 2006 and 2007 plus 3% on top of that.  Your millage rate starting on October 1st will no longer be at 4 mills, and we took such a big hit because it was mandated.

            Mr. Gatti asked will we be at one mill?

            Mr. Rodriguez responded you will be close to 3.89%.

            Mr. Lambert stated I read in the newspaper today one of the fire districts in North Naples was going to use the same millage rate as previous years and was not going to roll back per the mandate.

            Mr. Rodriguez stated a special district can do a special assessment in order to retain their millage rate.  The obvious difference is you are a rural community and they are rural community in the Everglades.  The property values are assessed in order to get these services, and you must increase it up to 4 mills in order to get a lump sum, which is a fact of life.

            Mr. Lambert stated it appeared they were not going to have to reduce their budget.

            Mr. Rodriguez stated they must presume they have to reduce the budget.  In order to offset this, they can provide an assessment back to them in order to get the money back since they are considered a special district.  I believe almost every municipality is going to do this in order to stay afloat.

            Mr. Cox stated there is legislation stating if you do not have a majority of Board support, you do not have to do the rollback.  You are going to see more general purpose governments using special assessments because you can analyze whether or not the benefit is worth the cost by holding public hearings for each service you are going to provide in order for the people to make a decision.

            Mr. McLaughlin stated when the head of EMS told the Commissioner he was going to have to take three units off of the road, he told them a determination must be made at the government level if they want to provide emergency services.

            Mr. Rodriguez stated the Collier County Board of Commissioners voted to reduce the millage and cut back to 3% as authorized by the Governor.

            Mr. Ziko asked will this new provision on I-75 in which you can assess the insurance company if you make a call from a vehicle reduce the millage rate?

            Mr. McLaughlin responded this is not going to affect the millage rate.

            Mr. Ziko stated I thought our millage rate was high because we were servicing I-75.

            Mr. McLaughlin stated the millage rate is high because of the necessary level of service due to the small population and highly-assessed property.

            Mr. Bissell asked where do the funds from the government impact fees go?

            Mr. McLaughlin responded it goes towards capital improvements.

            Mr. Bissell asked is this for the CID?

            Mr. McLaughlin responded it is for the millage for the Ochopee District.

            Mr. Cox stated they will fund the building outright.

            Mr. McLaughlin stated we had a developer come in to build three 21-story high-rises at a cost of $150,000 in impact fees for each building.  A developer usually has an impact fee schedule, which is beneficial.  If they decide to put up more buildings, more money is going to be added to the impact for the land which allows for a permanent facility.

            Mr. Rodriguez stated impact fees cannot be used for manpower or replacement of existing vehicles.  They can only be used for capital improvement.

 

THIRD ORDER OF BUSINESS                             Manager’s Report

            C.        Discussion of Entry Signs

            Mr. Bissell stated Lykins-Signtek will make a presentation.

            Mr. Cox stated we need to discuss the land acquisition for the fire station since it is going to change the scope of the sign company’s work.  If we decide not to go through with the land transaction, the placement of the easements may change.

            Mr. Lambert asked is one wall or two walls out of the easement on Cays Drive?

            Mr. Cox responded one easement is partially out and other one is totally out.

            Ms. Dillon stated we are just going to put a sign in the median as opposed to the side walls, regardless of what happens on Cays Drive.

            Mr. Ortiz stated I represent Lykins-Signtek and will distribute mock-ups of the signs as discussed.

            Ms. Dillon stated these are internal which we agreed should be the old style.

            Mr. Bissell asked were we willing to go with the same size as the others?

            Mr. Teague responded I thought we were having the same design for all new signs going forward.

            Mr. Ziko stated I agree.

            Ms. Dillon stated we agreed these were going to be internal signs in the old style.

            Mr. Teague this is one of the reasons Mr. Ortiz is here.  We must discuss this as a group because I cannot be sent in two different directions.

            Mr. Ortiz stated I realize there have been many permitting issues and you probably narrowed it down to this in order for me to have something to work from.

            Mr. Teague stated we are currently looking at the new design which was developed two years ago in which the signs for Union Road and Cays Drive will be 2’ x 5’ in width.  The same will hold true for the hotel and marina entrance, and the one on the arch will cover exactly what is currently there.

            Mr. Ortiz stated we are trying to keep everything uniform.

            Mr. Teague stated perhaps we should get a consensus as to what design you want to use first.

            Mr. Lambert asked was the original design which you set up for us to be located in the median area of Union Road bigger than 2’ x 5’?

            Mr. Bissell responded the original size was 4’ x 6’.

            Mr. Ortiz stated there was a sign in the median which measured 4’ x 6’.

            Mr. Lambert stated those two signs should be slightly larger than 2’ x 5’.

            Mr. Ortiz stated this is not a problem.  Is this for the Cays and Union Road?

            Mr. Lambert responded I perceive it to be these two signs.

            Mr. Teague asked do you perceive a problem permitting those size signs?

            Mr. Ortiz responded since the internal signs are meant to be directional there may be NSU for permitting involved.

            Mr. Cox stated I agree with you and if they are going to have to be permitted, we may have some issues.

            Mr. Ziko asked are you referring to the internal signs?

            Mr. Teague responded we are referring to the signs on the median.

            Mr. Cox stated we are referring to the internal directional signs.

            Mr. Ziko stated we are referring to the sign which is going to be in the middle of the median at the entrance to Cays Drive and Union Road, which are not internal directional signs.

            Mr. Ortiz stated the size of the sign will have to be permitted.  However, I will check with the county.

            Mr. Ziko stated this one is a 4’ x 6’ sign.

            Mr. Cox stated I believe there is an exception if it is a common theme for a subdivision.

            Mr. Teague stated the preference is 4’ x 6’ if permissible.

            Mr. Lambert stated we want it to be as large as permissible, but we are willing to come down to 4’ x 6’.

            Mr. Teague stated in other words, the sign should be 4’ x 6’ or as large as permissible, the two signs there.  I believe someone mentioned to me that on the hotel entrance, we should have Hotel Entrance with one arrow and Marina Entrance on the same sign pointing towards it.

            Mr. Ziko stated people entering on Newport Drive will probably turn into the hotel, even though the marina is at the next exit down the road.

            Mr. Cox stated I believe these internal signs will have to be permitted.

            Ms. Dillon asked did you confirm this?

            Mr. Cox responded yes.

            Ms. Dillon asked what about Sanctuary Point and Eveningstar Cay?

            Mr. Ortiz responded those were non-conforming signs.  In other words, they can where they are, but you cannot modify them.

            Mr. Cox stated another reason the county has not forced you to do anything up here is because they believe those signs are on private roads.  You can technically put them up, but if you were going through a regular submission review process, they would review the location and size configuration of those signs.

            Mr. Ziko stated the signs we are putting up are on CID property.

            Mr. Cox stated I realize this.  Everyone who is putting up signs is supposedly on their own property.

            Ms. Dillon asked can we do anything with our old signs?

            Mr. Ortiz responded anything which has been there and is non-conforming can remain as it is, as long as you do not do anything new to it.

            Ms. Dillon asked does this apply to painting the sign?

            Mr. Cox responded you have the design which conforms to regulations, and we can check on this in order to ensure it is in conformance.  Since you are going through the permitting process for the other signs, perhaps you should get them permitted.

            Mr. Ortiz stated if it is not permissible, they will not permit it, but they will not tell you to remove it.  If it was put there at one time, you can keep it, as long as you do not try to increase the size or do anything else to it.  This is the definition of a non-conforming sign.

            Ms. Dillon stated we must change the hotel sign in order to give direction to both the marina and the hotel, and they must be permitted.  Is that correct?

            Mr. Ortiz responded yes.

            Mr. Bissell asked do we want them to be 2’ x 5’, which is rather large?

            Mr. Ortiz responded they cannot exceed 12 square feet.

            Ms. Dillon stated it is really not so big.

            Mr. Ortiz stated I measured it and this is what you currently have, after which I matched them.

            Mr. Ziko asked will you be able to reduce the lettering on the hotel entrance sing in order to indicate Hotel Entrance with a directional arrow as well as Marina with a directional arrow?

            Mr. Ortiz responded it is not a problem to change the art.

            Ms. Dillon stated the main idea was for the hotel entrance sign to direct you in the appropriate direction, as well as Marina with an arrow going straight.  Therefore, when people drove down Newport, they knew you turned left to the hotel, but continued straight to get to the marina, after which you will see the marina entrance sign.

            Mr. Ortiz stated it will have to be specifically configured.  If the dimensions are 2’ x 5’, it will probably have to stand differently in order to get all of this information.

            Mr. Lambert asked are these signs going to be mounted with white posts?

            Mr. Ortiz responded they are currently proposed to be sandblasted cedar with white 4’ x 4’ posts.

            Ms. Dillon asked will the prices increase if Marina is added to the sign?

            Mr. Ortiz responded there will be a small increase since I am probably going to increase the size of the sign slightly.

            Mr. Bissell stated I have an issue with the arch sign.  The Port of the Islands will go up around the arch in large letters and the logo will go below The Port of the Islands.

            Mr. Teague stated I am confused.

            Mr. Bissell stated The Port of the Islands will be in large letters with the logo below it.  The marina and the hotel signs will be much smaller.

            Mr. Cox stated I am not certain you can do this without a permit, unless you somehow tie it in as a theme.

            Mr. Ortiz stated we were initially working on this for approximately three years, and this was not presented at the time.  This did not go through the meetings I had with them, and this sign does not have a permit right now.  Since this is another non-conforming sign, they are going to have to work with us in order to determine whether or not it can be done.

            Mr. Cox stated in order to have the signs this close with the same theme, it must be a unified subdivision and it cannot really have a commercial context to it.

            Mr. Ziko asked is Hotel and Marina generic since we are not advertising a specific hotel or marina?

            Mr. Cox responded I am just giving you a yellow flag as opposed to a red flag in the event you may want to think of some alternative language.

            Mr. Bissell asked do we need to put in Marina and Hotel?

            Mr. Lambert responded I do not believe we should put Marina and Hotel in there because we may then have to include signage for Hotel, Gun Club and RV Park.

            Mr. Cox stated Waterfront Community catches the tradition when this was started.  It was going to be a community for people to have fun.

            Mr. Teague stated this does not support anything since resort and waterfront community are considered descriptions.

            Mr. Bissell stated this is a living community.

            Ms. Dillon stated I have no problem with Port of the Islands Waterfront Community and removing Marina and Hotel from the sign.  Indicating this in the arch is acceptable to me as long as Port of the Islands is in larger letters.

            Mr. Bissell asked is it the Board’s consensus to have Waterfront Community indicated there?

            Mr. Ziko responded I like Mr. Cox’ idea.

            Mr. Cox stated I said Resort and Waterfront Community.

            Mr. Ziko stated this is acceptable to me.

            Mr. Bissell stated this is a community as opposed to a resort.  Marina and Hotel will be removed and Port of the Islands will be in large letters.

            Mr. Ziko stated the address number can be indicated below the sign.

            Ms. Dillon stated you can remove Hotel and Marina.

            Mr. Bissell asked what is going to be placed there?

            Mr. Lambert responded it will say, Resort and Waterfront Community.

            Mr. Bissell asked is this going to be in small letters?

            Mr. Ortiz responded that is correct.  Port of the Islands will be larger.

            Mr. Bissell asked can you work that up and e-mail that to Mr. Teague who can send it to the Board?

            Mr. Ortiz responded absolutely.

            Ms. Dillon stated I believe Port of the Islands should also be more prominent on the Union Road and Cays Drive signs.

            Mr. Ortiz stated those designs should work.

            Ms. Dillon stated I believe Port of the Islands on the Union Road and Cays Drive signs should also be in a larger font.

            Mr. Lambert stated Union Road and Cays Drive should be in a smaller font.

            Mr. Teague stated the other one is a wall sign.

            Ms. Dillon stated there will not be a wall sign.  Marina Entrance is acceptable, but under Hotel Entrance, we must have the arrow pointing towards the hotel, and Marina with the arrow going straight below it.

            Mr. Ortiz stated in other words, this is going to be one sign.

            Ms. Dillon stated there are going to be two signs.

            Mr. Teague stated Marina Entrance is acceptable.

            Ms. Dillon stated Hotel Entrance will have an arrow going left as you are coming down, but below it, there should be a sign which says Marina with the arrow going straight to prevent people from turning into the hotel if they are going to the marina.

            Mr. Ziko stated we just need to have a line underneath this going up one side of the sign pointing in the direction of the marina.

            Mr. Teague stated you will have double–sided signs for Union Road and Cays Drive in the median; Resort and Waterfront Community will be a double-sided sign; and a sign for the Marina and one for Hotel/Marina.

            Mr. Ziko stated I believe the Hotel/Marina sign will be in the center island and the Marina sign is going to be on the right-hand side.

            Mr. Bissell stated all signs will be on the right-hand side.

            Mr. Teague stated you also included some restoration work on the arch prior to installation.

            Mr. Ortiz stated the marina and hotel has a large pylon sign which we are going to work with.

            Mr. Lambert stated I want to finish discussing these five signs before we talk about restoration.  I want to know whether we are going to repair or knock down the walls and monuments.

            Mr. Teague asked do you have a crew who can repair those monuments?

            Mr. Ortiz responded the mock-up represent the way we project they will look like after the work is done.

            Mr. Lambert stated we have wall monuments in two locations, one at Cays Drive and the other at Newport.  We cannot do anything with the wall monuments on Cays Drive since we do not have any easements there.  The wall monument on the east side of Newport Drive on the hotel property is in the worst condition.  Will the hotel give us an easement in order for us to repair it?

            Mr. Cox responded they never said they will give you an easement, but they are willing to negotiate the easement if you put a sign up for their process.

            Mr. Lambert stated they should put up a sign on their own property.

            Ms. Dillon stated we never heard back from them one way or the other and they never answered the letter Mr. Teague sent to them with regards to their sign.

            Mr. Lambert stated we cannot repair this monument.

            Ms. Dillon asked can we remove it?

            Mr. Bissell responded perhaps we can remove the west monument if we are not putting anything there.

            Mr. Lambert stated I personally like the wall monuments, which is why I want to repair them.

            Mr. Cox stated you can paint them in order to make them look nice, but you cannot do anything with the signage since they are not on our property and we do not have an easement there.  If you remove the signage, they may choose to knock the wall down and rebuild it themselves, but I do not believe they will.

            Mr. Lambert stated perhaps we can talk to them since it does not make sense for them to accept the shoddy appearance of the monument when they are trying to market the property.  Repair fits in with the whole scheme of this and if we can do it without an easement, we should do so.

            Ms. Dillon stated when the new sign is ready to be installed, we should remove theirs.

            Mr. Ziko asked are you going to paint over the sign in the arch?

            Mr. Ortiz responded we are going to paint over it.  I am going to post Resort and Waterfront Community.  We are going to make the signs for Union Road and Cays Drive as large as is permissible; along with signs for Marina Entrance and Hotel Entrance with the arrow for marina.

            Mr. Bissell stated you will get this to Mr. Teague with signs.

            Mr. Lambert asked can you do the maintenance work on the walls if we decide to pursue it?

            Mr. Ortiz responded the initial proposal was to paint the walls and add the copy.

            Mr. Ziko asked what about the tiles on top?

            Mr. Ortiz responded we tried to get tiles a few years ago since the wood was rotted and the owner did not want to get involved with this small section.  Unfortunately, we were unable to find matching tiles.

            Mr. Cox asked is it possible for you to arrange for a subcontractor to take care of the tile work?

            Mr. Ortiz responded he recommended removing this section and painting it, after which I can put it into the sign and see how it looks like without the tiles.  I believe it will look good.  It is just a matter of finding the appropriate design and trying to find a contractor to do this work.

            Mr. Ziko stated many of these tiles are broken.  I do not believe you can just paint them.

            Mr. Ortiz stated I agree with you.  The wood held this tile and part of my proposal was to remove the tile and paint the section along with some trim.

            Mr. Lambert stated Mr. Cox should speak with hotel staff and let Mr. Ortiz know whether or not he can do the maintenance work.

 

SECOND ORDER OF BUSINESS                          Approval of the Minutes of the

June 8, 2007 Meeting

            Mr. Bissell stated each Board member received a copy of the Minutes of the June 8, 2007 meeting and requested any additions, corrections or deletions.

            Mr. Bissell stated on Page 1 under the first order of business, I called the meeting to order as opposed to Mr. Goscicki.

            Ms. Dillon stated on Page 31 under the fifth order of business, the Engineer’s Report was not continued.  On Page 34 in the second paragraph from the bottom in the first sentence, company should replace cracking.

 

On MOTION by Mr. Lambert seconded by Mr. Ziko with all in favor the minutes of the June 8, 2007 meeting were approved as amended.

 

 

THIRD ORDER OF BUSINESS                             Manager’s Report (Continued)

A.                 Questions and Comments on the Revised Budget

Mr. Teague stated I am not certain whether or not all of the requested changes were included since I did not attend the last meeting.  There was a discussion in which the Capital Outlay may be too low.  There was also a question with regards to the Depreciation Expense as to the definition and reason it is included in the budget.  The auditors like to see this budgeted.  It is cash which does not go anywhere.

            Mr. Lambert asked does this mean we are budgeting for replacement of major items?

            Mr. Teague responded that is correct.

            Ms. Dillon stated since it is considered an expense, we are theoretically spending it in the budget.

            Mr. Teague stated it is not a cash expenditure until you actually replace something.

            Mr. Ziko stated we will not have any of this money when we replace something.

            Mr. Teague stated it is there.  It just goes into your Reserves.

            Mr. Ziko asked are you moving it into Reserves?

            Mr. Teague responded we are showing it as an expenditure, but you are not withdrawing it out of your revenue as you collect your money.

            Mr. Lambert asked do you have to identify the individual pieces for which you are collecting Reserves?

            Mr. Teague responded depreciation expenses on all of your assets are identified in the audit.

            Mr. Bissell asked are they cumulative?

            Mr. Teague responded it is there every year.

            Mr. Bissell asked is it adding up?

            Mr. Teague responded that is correct.

            Mr. Ziko asked is this for the useful life of the property depreciating?

            Mr. Teague responded that is correct.  It goes away at 10 or 20 years.

            Mr. Cox stated much of it has been depreciating.

            Mr. Ziko stated there is no recapture since this is a governmental entity.

            Mr. Cox stated one of the most bizarre things which occurred in the history of governmental accounting is when they started forcing governments to depreciate assets.  Essentially, you are keeping track of what needs to be reserved to replace the capital asset.

            Mr. Teague stated the other issue was to ensure the assessment level is the same.  Actually, the assessments reduce slightly because of a reduction in debt service.  On Page 11 under the summary of the assessments, the General Fund Assessments are staying the same as last year at $363 per unit; Debt Service is decreasing to 43%; Water & Sewer is remaining the same at $1,020.  Total Assessments Per Unit is decreasing from zero to 18.8% depending on the type of unit.

            Mr. Cox stated since we have a settlement agreement with Parcel XI, they do not have any debt.

            Mr. Bissell asked how much money did we collect from the people for the 2007 budget?

            Mr. Teague responded each of the funds show a 2007 and 2008 comparison.  You can see those numbers are exactly the same, but the Debt Service shows a reduction.

            Mr. Bissell stated if we collected $1.8 million last year and Debt Service decreased, we still need the money for these projects.

            Mr. Teague stated you have $409,163 on roll in the General Fund, as you had last year as shown on Page 2.  If you look at Adopted Budget 2007 and Proposed Budget 2008, we are at $409,163 after which the debt will decrease.  The amount of $1,053,115 is the same from both years on the Enterprise Fund as shown on Page 12.

            Mr. Bissell stated our tax bill will be the same amount.

            Mr. Teague stated it will actually be slightly less because the Debt Service decreased.

            Mr. Lambert asked can you explain further?

            Mr. Teague responded Page 11 breaks down your assessments.  I believe your tax bill says Special Assessments CID, which is a lump sum in the amount of $1,790 in this particular unit for Motwani, and last year it was $2,101.

            Mr. Ziko stated this was the South Hotel.

            Mr. Teague stated Sunrise Cay showed $2,127, and this year it will be $1,805, which is due to a reduction in the Debt Service.  The special assessments are on one bill consisting of three categories.  Since the debt is getting old and the interest is lower than it has been in the past, your principal is lower.

            Mr. Ziko stated I thought these were based on ERCs.

            Mr. Teague stated items for Operation & Maintenance as well as the Enterprise Fund are based on ERCs, but Debt Service is based on various different factors when they do the methodology analysis.

            Mr. Bissell stated we discussed the possibility of having a contingency fund where the Debt Service decreased at the last meeting.  Therefore, we are going to collect the same amount next year.

            Mr. Teague stated this includes Debt Service, which will increase the General Fund and Water & Sewer.

            Mr. Lambert stated we need to do this because we many tasks which must be paid for.

            Mr. Bissell stated we have things coming up all of the time which is costing us money.

            Mr. Teague stated it was not presented this way.  However, we will make the correction by increasing either the Water & Sewer levy or the General Fund levy.  I believe it makes sense to increase the Water & Sewer Fund in order to absorb the savings in the Debt Service.

            Mr. Bissell stated our tax bill will be identical.

            Mr. Lambert stated all you will have to do is install the numbers.

            Mr. Teague stated it is going to be difficult because your debt is based on property type.  Therefore, you are not going to see it exactly, but we will get it.

            Mr. Cox stated since you have different property types, you have some residents who already paid their debt off; and if you keep the dollar collection the same, those who have not paid it off are going to have an increase.

            Ms. Dillon stated the only people who will be affected by this are those who are still paying on their bond.

            Mr. Cox stated this is a like a windfall for those from the settlements that we got out of the other thing, the interest and deeds that we collected from the Marchand and Motwani properties.  There is interest on penalties which we collected from those properties as well.  It is kind of a bonus for those people still paying their debt, but if you try to keep everyone’s assessments the same as they were for last year, you are taking the money from those who already paid off their debt.

            Mr. Teague stated their Enterprise Fund assessment is going to increase, but they are not going to get a reduction because they have no debt service to be removed.

            Mr. Ziko stated basically those Debt Service numbers do not mean anything if you already paid your bond off.

            Mr. Cox stated you are keeping your Enterprise Fund and your General Fund the same, which is fair to the people who already paid their bonds off.  Perhaps you can charge everyone an additional $25 for an ERC in order to raise another $25,000.

            Mr. Ziko stated we have the special assessment which does not show up on this page in the amount of $700.

            Mr. Cox stated it was budgeted in last year’s General Fund as an actual collected in the amount of $409,163 as shown on Page 2.  The Consumer Price Index was at 3%, which is $12,000 or $12 per ERC to keep your assessments the same as last year.  You can increase your Enterprise Fund by another $30,000, in order to increase your revenue by $45,000.  However, I believe it is fairer to charge everyone across the board instead of penalizing the people who paid their special assessment.

            Mr. Ziko asked are we doing this?

            Mr. Cox responded you are assessing the same amount as last year.  However, you may want to spend 3% more this year and capture the extra $45,000.

            Mr. Teague stated if you paid your debt assessment off, and we reduced the debt and put it on someone else, yours will increase above this amount since you have no debt.

            Mr. Cox stated if we kept it the same for the people who got the debt reduction, you are going to have an incremental increase on yours.

            Mr. Teague stated I was going to increase the Enterprise Fund and decrease the debt.

            Ms. Dillon stated this no longer seems equitable.

            Mr. Lambert stated I believe we need to increase the increment to others for something.  However, it does not make sense to reduce the taxes when we have all of this work to do.

            Mr. Teague asked do you want to look at 5% or 3%?

            Mr. Cox responded perhaps we can give you $50,000 at 3% and decrease it to $45,000.

            Mr. Teague stated we can put it on either of the two funds and into the Reserves.

            Ms. Dillon stated the Water & Sewer Fund makes the most sense since this is where we are spending the money.

            Mr. Lambert stated we should put it on both of them.  It does not make sense not to receive the money.

            Mr. Teague stated the Board needs to relate a number.

            Mr. Lambert stated I believe it should be 5%.

            Mr. Teague asked do you want it to be 5% on each fund or 2½% on each fund?

            Mr. Bissell responded it should be 5% on each fund.

            Ms. Dillon stated there will be a 10% increase.

            Mr. Bissell asked does this have anything to do with our tax bill?

            Ms. Dillon responded the tax bill will be increased.

            Mr. Cox stated if you increased by 5% on this, last year it was $363 per ERC, which amounted to $16.50 in general funds as well as a $57 increase in everyone’s taxes this year.

            Mr. Ziko asked how does this work?

            Mr. Cox responded you must recognize them because their debt service was actually more, but they received the benefits of other people being late.

            Mr. Bissell