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Agenda 12/11/2018 Item #11D
12/11/2018 EXECUTIVE SUMMARY Recommendation to review and approve the County’s delivery plan for the execution of the projects approved by the Board and a majority of the electorate to be funded from the proceeds of the One-Cent Infrastructure Surtax (Sales Tax) with oversight from a Citizen Advisory Committee. OBJECTIVE: To provide the Board and the public an overview of the delivery plan for the projects approved with the Sales Tax referendum. CONSIDERATIONS: On April 4, 2018, agenda item 9C, the Board approved the governing ordinance placing the Sales Tax referendum on the November 6, 2018 ballot. On September 4, 2018, the Florida Legislature's Office of Program Policy Analysis and Government Accountability (OPPAGA) delivered the statutorily required performance audit. The ordinance and the audit report have been posted on the county’s website and are included with this agenda item. On November 6, 2018 a majority of the electorate approved the Sales Tax referendum. Revenue collection from the Sales Tax will begin on January 1, 2019. It is anticipated that the county and municipalities will begin to receive disbursements within three months of the start of collections. The revenue forecast provide by the Florida Department of Revenue (DOR) has been updated since the original ballot language was adopted. The table below provides the latest DOR forecast. Local Government Distribution Percentage FY End Sep 30, 2019 Forecast Collier BCC 90.152% $73,533,910 Everglades 0.116% $94,450 Marco Island 4.453% $3,632,178 Naples 5.279% $4,305,696 Total 100.00% $81,566,235 *Source August 13, 2018 DOR Office of Tax Research Revenue from the Sales Tax will be collected until December 31, 2025 or terminated at the end of an earlier calendar year, if the total revenue equals or exceeds $490,000,000 at any time prior to 2025. Distribution to the municipalities will be done directly through the DOR based on the Sales Tax formulas provided in s. 218.62 F.S. The governing Sales Tax Ordinance included Exhibit “A” which identified three high-level categories, specific projects within the categories, and an allocation schedule based on a preliminary assessment and the estimated revenue from the Sales Tax. County staff will execute the projects consistent with Florida Statute 212.055(2) as summarized in the 2018 Local Government Financial Information Handbook pages 179-183 attached. The Citizen Oversight Committee (Committee) shall be responsible to review project expenditures for consistency with the ballot language and governing ordinance. 11.D Packet Pg. 645 12/11/2018 The approved ballot language governing expenditures reads as follows: COLLIER COUNTY AND MUNICIPAL INFRASTRUCTURE ONE - CENT SALES SURTAX To enhance safety, mobility, and hurricane preparedness in Collier County and its cities by constructing, repairing, and maintaining roads, bridges, signals, sidewalks, parks, evacuation shelters, governmental facilities, including emergency services facilities; acquire land and support construction for workforce housing and career and technical training, veterans’ nursing home and expand mental health facilities; shall the County levy a one-cent sales surtax beginning January 1, 2019 and automatically ending December 31, 2025, with oversight by citizen committee? The county’s Transportation Division and Facilities Management Division will be responsible for the execution of all the projects apart from the VA Nursing Home and the Workforce Housing Land Trust Fund at this time. Each capital project will have an assigned project manager with oversight from a senior project manager having a Florida Professional Engineering designation. The county divisions responsible for the delivery of these projects have constructed and currently maintain billions of dollars of public infrastructure and were the focus of the state mandated performance audit completed by OPPAGA. The audit confirmed the capability of these divisions to manage and deliver similar projects. Some of the projects identified in Exhibit “A”, such as the Vanderbilt Beach Road extension, are already in progress. Regardless of the status of a project, it is the intent of the County Manager to submit individual project briefings and project management plans through the Committee for a review. After the Committee reviews the planned expenditure, the project will be submitted to the Board through the normal approval process for contracts and expenditure approval. Subsequently, each project approved by the Board will be added to the agency’s quarterly Capital Projects Tracking (Caps-Track) initiative and placed on the Sales Tax website for public viewing until completed. The Caps-Track information will also be provided to the Committee on the same quarterly schedule. Our goal is to maintain the highest level of transparency throughout the delivery lifecycle. Projects will be prioritized based on health, safety, and welfare first; condition of asset and cost of ongoing maintenance second; and market conditions and availability of funds third. It is our intent to manage the delivery of these projects in a manner that takes advantage of the construction market by preparing these projects for construction and looking for opportunities to leverage a grouping of these projects and timing to be the most advantageous for the County. We recognize that we are in the ninth year of an economic expansion with construction activity and corresponding construction values currently increasing as shown on the most recent Turner Building Cost index. The attached delivery schedule will be evaluated on a quarterly basis and adjusted based on readiness and market conditions. There are five projects on Exhibit “A” that will require a slightly different approach. These include: 1) Sheriff’s Forensic Evidence and Administration Building; 2) Career and Technical Training Center; 3) Mental Health Facility; 4) Workforce Housing Land Trust Fund; and 5) VA Nursing Home. These projects will involve outside stakeholders and partners with varying levels of interest and future participation. Each project will be assigned a county project manager that will facilitate the execution through a delivery team model. This includes participation from the end user in the solicitation, selection, design, and construction of the facility. 11.D Packet Pg. 646 12/11/2018 FISCAL IMPACT: Office of Management and Budget staff is currently discussing with Clerk of Courts Finance staff the proper mechanics to account for and budget local option infrastructure sales tax proceeds and related project expenses. At the very least the structure will include a separate fund to capture the monthly proceeds and separate funded program accounting codes by project to track all expenses. It is anticipated that initial local option sales tax proceeds will be received in March 2019. Depending upon the timing of certain project readiness, the Board may choose to issue short term commercial paper to fund up certain priority projects in anticipation of future sales tax receipts. Any commercial paper note(s) would be paid off in approximately twelve to eighteen months when adequate sales tax revenue is received. For example, if during the middle of FY 2020, sales tax proceeds collected total $80 million but $150 million in projects are ready to proceed to contract, gap funding in the form of commercial paper would be an option to facilitate proj ect completion instead of waiting until sufficient sales tax revenue has been collected. Board members should remember that the surtax proceeds and any interest may not be used to fund the operational expenses of infrastructure. Property taxes comprise 73% of all General Fund (001) revenue and 75% of all Unincorporated Area General Fund (111) revenue. Of the $435.9 million General Fund budget, 73% of appropriations are allocated to either health, safety and welfare services; legislative and statutory mandates or debt service. The remaining 27% are considered general governmental in nature. Within the Unincorporated Area General Fund, 24% of the $58.9 million in total appropriations are considered health, safety and welfare and mandates. The remaining 76% are considered general governmental in nature. Knowing this, the Board should carefully consider FY 2020 tax rate policy as it is presented in February/March 2019 in the context of fully funding storm-water maintenance at an increasing service level if the storm-water utility fee is not enacted; increasing infrastructure maintenance obligations connected with the new Sports and Special Event Complex, as well as the Big Corkscrew Island Regional Park ; new and existing economic development obligations associated with CRA’s and innovation zones; maintaining median landscape infrastructure as costs continue to escalate; funding school safety officers at an increasing rate; all while continuing to allocate dollars toward maintaining existing park, facilities and transportation infrastructure. GROWTH MANAGEMENT IMPACT: There are no Growth Management Impacts associated with this Executive Summary LEGAL CONSIDERATIONS: This item has been reviewed by the County Attorney and approved as to form and legality and requires majority vote for approval. -JAK RECOMMENDATION: To review and approve the County’s delivery plan for the execution of the projects approved by the Board and a majority of the electorate to be funded from the proceeds of the Sales Tax with oversight from the Committee. Prepared by: Nick Casalanguida, Deputy County Manager ATTACHMENT(S) 1. Ordinance No 2018-21 and Exhibit "A" (PDF) 2. OPPAGA_CollierCo_PerfAudit (PDF) 3. 2018 EDR Finance Handbook (Pages 179-183) (PDF) 11.D Packet Pg. 647 12/11/2018 4. Turner Building Cost Index 2018 Qrtr3 (PDF) 5. 7 year tenative Project Delivery Chart (PDF) 6. One-Cent Sales Surtax next steps (presentation) (PDF) 11.D Packet Pg. 648 12/11/2018 COLLIER COUNTY Board of County Commissioners Item Number: 11.D Doc ID: 7495 Item Summary: Recommendation to review and approve the County’s delivery plan for the execution of the projects approved by the Board and a majority of the electorate to be funded from the proceeds of the One-Cent Infrastructure Surtax (Sales Tax) with oversight from a Citizen Advisory Committee. (Nick Casalanguida, Deputy County Manager) Meeting Date: 12/11/2018 Prepared by: Title: Operations Analyst – County Manager's Office Name: Geoffrey Willig 12/04/2018 1:09 PM Submitted by: Title: County Manager – County Manager's Office Name: Leo E. Ochs 12/04/2018 1:09 PM Approved By: Review: County Attorney's Office Jeffrey A. Klatzkow Level 2 Attorney Review Completed 12/05/2018 7:50 AM Office of Management and Budget Valerie Fleming Level 3 OMB Gatekeeper Review Completed 12/04/2018 3:15 PM Budget and Management Office Mark Isackson Additional Reviewer Completed 12/04/2018 3:59 PM County Attorney's Office Emily Pepin CAO Preview Completed 12/04/2018 5:06 PM County Attorney's Office Jeffrey A. Klatzkow Level 3 County Attorney's Office Review Completed 12/05/2018 7:51 AM County Manager's Office Leo E. Ochs Level 4 County Manager Review Completed 12/05/2018 8:47 AM Board of County Commissioners MaryJo Brock Meeting Pending 12/11/2018 9:00 AM 11.D Packet Pg. 649 11.D.1 Packet Pg. 650 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 651 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 652 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 653 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 654 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 655 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 656 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 657 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) 11.D.1 Packet Pg. 658 Attachment: Ordinance No 2018-21 and Exhibit "A" (7495 : Sales Tax Delivery Plan) P ERFORMANCE AUDIT OF C OLLIER C OUNTY Final Report September 4, 2018 www.mgtconsulting.com 11.D.2 Packet Pg. 659 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) Performance Audit of Collier County | September 4, 2018 | Final Report Page | i Performance Audit of Collier County Final Report September 4, 2018 TABLE OF CONTENTS INTRODUCTION ................................................................................................................................... 1-1 REPORT SUMMARY ............................................................................................................................... 2-1 LIST OF FINDINGS ................................................................................................................... 2-1 OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS .................................................... 3-1 OBJECTIVES, SCOPE, AND METHODOLOGY ............................................................................. 4-1 APPENDIX A COLLIER COUNTY MANAGEMENT RESPONSE LETTER .......................................................... I 11.D.2 Packet Pg. 660 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) Performance Audit of Collier County | September 4, 2018 | Final Report Page | 1-1 INTRODUCTION Collier County (County) was established in 1923 under the constitution and laws of the State of Florida. The Board of County Commissioners (BCC) is the chief legislative body for the County, and its general duties and responsibilities are outlined in Chapter 125 of the Florida Statutes. The BCC is composed of five County Commissioners elected by voters. The BCC approves the County budget, adopts local ordinances and resolutions, and establishes high-level policies that govern the County and ensure the health, safety, and welfare of the citizens. The BCC is also responsible for hiring a County Manager to oversee the day-to-day operations of the County in line with BCC policy. The County Manager sets administrative policy associated with the day-to-day operations. The BCC conducts budget workshops during June of each year as part of its annual budgeting process. The County’s economic base is concentrated in tourism, agriculture, fishing, ranching and forestry, with a growing services economy and an emerging technology sector. The County has the largest area of any county in Florida at 2,026 square miles. With a population of 372,880 in 2018 (an 18 percent increase over the last 10 years), the County has been one of the fastest growing counties in Florida over the last 10 years. The County provides its citizens with a wide range of services that include law enforcement; emergency management; fire and Emergency Medical Services (EMS) services; library; museum and cultural services; parks and recreation operations; as well as road maintenance and construction. In addition, the County owns and operates a water and wastewater utility; a solid waste landfill gas to energy facility; three airports; and a transit system. Pursuant to the requirements of Ch. 2018-118, Laws of Florida, the Office of Program Policy Analysis and Government Accountability has contracted with MGT Consulting Group (MGT) to conduct a performance audit of the programs associated with the surtax ordinance adopted by the Collier County Board of County Commissioners on April 24, 2018. This performance audit of the County focused on program areas related to construction, repair or maintenance of roads, bridges, signals, sidewalks, parks, as well as evacuation shelters, governmental, mental health, and emergency services facilities; and the acquisition of land and construction support for workforce housing and career and technical training, veterans’ nursing home(s), and expanded mental health facilities. The audit was conducted in accordance with Generally Accepted Government Auditing Standards. Those standards require planning and performance of the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for our findings and conclusions based on our audit objectives. Audit activities included interviews with key personnel, review of relevant information (including capital planning documents, proposals and bid tabulations, project invoices and status reports, appraisals, policies, laws and other documentation), site visits, and benchmarking. MGT believes that the evidence obtained provides a reasonable basis for the findings and conclusions based on the defined audit objectives. 11.D.2 Packet Pg. 661 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 1: INTRODUCTION Performance Audit of Collier County | September 4, 2018 | Final Report Page | 1-2 Our audit included performing procedures to gain an understanding and evaluate significant internal control within the context of our audit objectives. Our consideration of internal control was limited to controls relevant to our audit objectives and was not designed to identify all deficiencies in internal control that might be material weaknesses or significant deficiencies. Given these limitations, during our audit we did not identify any deficiencies in internal control that we consider to be material weaknesses. However, material weaknesses may exist that have not been identified. 11.D.2 Packet Pg. 662 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) Performance Audit of Collier County | September 4, 2018 | Final Report Page | 2-1 REPORT SUMMARY Pursuant to the scope identified in the Request For Quotes, the audit focused on the program areas related to: Construction, repair or maintenance of roads, bridges, signals, sidewalks, parks, as well as evacuation shelters, governmental, mental health, and emergency services facilities; and the acquisition of land and construction support for workforce housing and career and technical training, veterans’ nursing home(s), and expanded mental health facilities. The audit therefore is organized according to the program areas within the County organizational structure relevant to the domains above: specifically, Transportation Engineering and Facilities Management. To assess the respective levels of performance of these elements of County operations, the audit team evaluated the following six key aspects of the program areas: Economy, efficiency, and effectiveness Structure or design Methods of providing services and products Goals, objectives and performance measures Adequacy of public documents and reports Process for ensuring compliance with policies, rules, and laws For each key aspect, MGT performed procedures to assess program performance. Audit procedures disclosed several key areas in which the Transportation Engineering and Facilities Management divisions performance passed the criteria for satisfactory performance for the scope of the information that was examined (i.e., included in findings areas no. 1, 2, 3, 4, 5, and 6) and two areas in which an adverse key finding was identified (i.e., findings no. 2 and 3). LIST OF FINDINGS F INDING 1 : E CONOMY, EFFICIENCY, AND EFFECTIVENESS The Transportation Engineering and Facilities Management projects that were tested were evaluated by County personnel using performance and cost information that is adequate to monitor project performance and cost. These projects were also completed on-time, within budget, and at a reasonable cost. Additionally, program administrators have taken reasonable 11.D.2 Packet Pg. 663 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 2: REPORT SUMMARY Performance Audit of Collier County | September 4, 2018 | Final Report Page | 2-2 and timely actions to address any deficiencies in program performance and cost identified in audits. FINDING 2: STRUCTURE OR DESIGN The Transportation Engineering and Facilities Management programs’ organizational structures have clearly defined units, minimize overlapping functions and excessive administrative layers, and have lines of authority that minimize administrative costs. Additionally, current staffing levels appear reasonable given the nature of the services provided and program workload based on a thorough budgeting and staff planning process; however, the County could undertake further efforts to measure workload and productivity to validate staffing levels against volume of need. FINDING 3: METHODS OF PROVIDING SERVICES AND PRODUCTS The overall execution of the Transportation Engineering and Facilities Management projects indicate that these projects have been executed efficiently with a mix of in-house and external help. However, the programs do not have a formal process for evaluating the effectiveness of alternative methods of providing services including in-house, contracted, and privatized services. FINDING 4: GOALS, OBJECTIVES AND PERFORMANCE MEASURES The Transportation Engineering and Facilities Management programs’ goals and objectives are clearly stated and are consistent with the County’s strategic plan. Management uses adequate measures to evaluate program performance and cost. Additionally, the internal controls evaluated by the audit team are adequate to provide reasonable assurance that program goals and objectives are met. FINDING 5: ADEQUACY OF PUBLIC DOCUMENTS AND REPORTS The Transportation Engineering and Facilities Management programs have processes in place to ensure the accuracy and completeness of relevant program performance and cost information provided to the public. Additionally, the public has access to information that is useful, timely, readily available and easy to locate. FINDING 6: PROCESS FOR ENSURING COMPLIANCE WITH POLICIES, RULES, AND LAWS The Transportation Engineering and Facilities Management programs have processes in-place to assess their compliance with applicable federal, state, and local laws, rules, and regulations; contracts; grant agreements; and local policies. In addition, the programs have taken reasonable and timely actions to assess if planned uses of the surtax comply with applicable state laws, rules, and regulations. 11.D.2 Packet Pg. 664 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-1 OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Findings of the performance audit focus on two program areas within the County – Transportation Engineering and Facilities Management – which oversee all functions relevant to the stated potential uses of the surtax funds. Each of the six research tasks associated with the audit are explored for both domains of the County’s operations, with findings presented as follows. Aspects of performance that pass audit criteria for the scope of information reviewed are identified by area of review and accompanied by a brief description of the current situation. Alternately, aspects of the organization that did not pass audit criteria (adverse findings) also include the same characterization of the areas of review and summary of current circumstances, but also include further detail and MGT’s associated recommendation for remediation of these adverse conditions. To assess the performance of these programs, MGT reviewed extensive reports and documentation regarding the organization, supplemented and informed by interviews with key staff including: County Administrator Director, Transportation Engineering Manager Finance and Operations, Operations Support Division Deputy Director, Facilities Management Senior Financial Analysist, Facilities Management Division Project Manager Findings regarding the performance of the Transportation Engineering and Facilities Management programs within the organization are summarized below. F INDING 1 : E CONOMY, EFFICIENCY, AND EFFECTIVENESS The Transportation Engineering and Facilities Management projects that were tested were evaluated by County personnel using performance and cost information that is adequate to monitor project performance and cost. These projects were also completed on-time, within budget, and at a reasonable cost. Additionally, program administrators have taken reasonable and timely actions to address any deficiencies in program performance and cost identified in audits. 11.D.2 Packet Pg. 665 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-2 TRANSPORTATION ENGINEERING The focus of the Transportation Engineering Division is to maintain safe traffic operation on the County's roads, implement capital improvements for the transportation network, and to acquire needed property for capital programs. Within the Transportation Engineering Division there are four sections that work in conjunction to these ends: Traffic Operations, Roadway and Bridge Project Management, Right-of-Way Acquisition, and Road Construction/Construction Engineering Inspection (CEI). Within their distinct disciplines, they also work to promote the quality, safety, and the efficiency of the County's road network through sound engineering principles, quality construction, diligent oversight, and effective maintenance. The duties and responsibilities of each of these sections are as follows: Traffic Operations - installs, inspects and maintains traffic signals, roadway lighting, and signs and also identifies, plans, designs, and oversees construction of intersection, safety, and capacity improvements, such as turn lanes, median modifications, sidewalk improvements and small drainage projects. These improvements are limited to small-scale, low-cost projects that will enhance traffic flow and/or promote safety. Roadway and Bridge Project Management - oversees consultants in the study, design and permitting of capital improvements on major roadway and bridge projects. The process begins with consultant selection and proceeds through 30%, 60%, 90% and 100% design plan stages, with public information meetings typically being held at each of these milestones. It is the responsibility of this section to coordinate with a variety of agencies to ensure compliance with all applicable governmental regulations. Right-of-Way Acquisition - responsible for acquiring property required for new roads, widening existing roads and for the construction and maintenance of canals, stormwater sites and water control structures. This section works closely with the County Attorney's Office to acquire land and/or easements via negotiated purchase, or when necessary, condemnation, in order to grant legal access for the County's contractors to enter upon theretofore private property to construct roadway, drainage, and utility improvements necessary to maintain acceptable levels of service for the residents of Collier County. Road Construction/CEI – responsible for ensuring that all Transportation Engineering capital projects are constructed in conformance with approved plans and specifications, whether it be roadway, bridge, sidewalk, stormwater outfall, or traffic signal. The team's focus in oversight of contractors and consultants is quality construction that is on schedule and within budget. Several planning functions guide the operations of this program. The Metropolitan Planning Organization (MPO) is a planning entity which includes representatives from the Board of Collier County Commissioners, the City of Naples, Everglades City, and the City of Marco Island. The MPO develops the long-range transportation plan for cost feasible transportation projects and helps set priorities for implementing projects listed in the transportation improvement program. It conducts public workshops, uses traffic models, and receives input from the public through its 11.D.2 Packet Pg. 666 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-3 board and through citizen input to determine transportation needs. The MPO’s long-range transportation plan is utilized by the County’s Growth Management Department (GMD) in planning and coordinating projects with other entities in the County. In addition to the long-range transportation plan, the County has an Annual Update and Inventory Report (AUIR) and Capital Improvement Element (CIE) each year to start the budget process for capital projects. Both processes focus on the schedule of capital improvements for the County. The AUIR is an annual status report on public facilities and the CIE is a planning document that identifies public facilities that will be required during the next five or more years. The CIE is the foundation of the County’s annual Capital Improvement Program (CIP). The Five-Year Work Program lists the proposed projects that are funded for each fiscal year. These are developed with the input of staff to fund the prioritized capital projects in the County and they are presented to the public, to the Planning Commission, and finally approved by the BCC. Repair and maintenance functions include rebuilding or paving roads, overseeing the replacement or rehabilitation of bridges when necessary, and for repairing and maintaining traffic signals and sidewalks. As part of audit testing, MGT selected a sample of eight (8) projects that were, or are being, performed by the Transportation Engineering Division during the period June 1, 2015, through May 31, 2018. (see Table 1 – Summary of Project Sample for Transportation Engineering below). TABLE 1 - SUMMARY OF PROJECT SAMPLE FOR TRANSPORTATION ENGINEERING PROJECT NAME ESTIMATED COST ACTUAL COST TO DATE PROJECT SCOPE PROJECT STATUS Collier Boulevard $31,206,592.00 $30,713,406.45 Roadway Complete Golden Gate Boulevard $30,492,132.00 $30,229,883.61 Roadway Complete Intersection Capacity Improvement $24,137,086.37 $21,582,235.42 Intersection Complete Vanderbilt Beach Road $53,553,459.00 $18,789,770.37 Roadway Design Chokoloskee Bridge Replacement $9,137,982.44 $7,581,038.98 Bridge Construction Vanderbilt Drive Memorial Pathway $2,417,573.64 $2,949,759.78 Sidewalk Complete Golden Gate Parkway Bearing Repairs $130,040.00 $130,029.00 Bridge Complete 11.D.2 Packet Pg. 667 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-4 PROJECT NAME ESTIMATED COST ACTUAL COST TO DATE PROJECT SCOPE PROJECT STATUS Repairs on Bridge 030149 $74,104.00 $52,080.90 Bridge Design MGT interviewed County personnel and reviewed supporting documentation (e.g., executive summary, monthly estimate reports, invoices, and other relevant information) related to each project to gain an understanding of the project requirements, performance, and cost. Audit procedures disclosed that: For all eight (8) projects, management evaluated project performance and cost using information that is adequate to do so. For all eight (8) projects, the performance management appeared reasonable. The projects are monitored regularly through on-site inspections as well as progress meetings. Once complete, projects are evaluated for compliance with the contract. Progress was also reviewed by program administration before approving payments to the project contractors. The five (5) projects that have been completed were all completed on-time and within budget when taking into consideration change orders. Some projects were not completed by the estimated completion date or estimated budget, but the time/cost additions or subtractions were introduced through the change order process. For such projects, MGT reviewed the change orders related to these projects and determined that there were unforeseen conditions or scope additions that required additional time or cost to complete and determined that the additional time or cost to complete the project was reasonable. One example of such a project is the Intersection Capacity Improvement project, which exceeded the contract schedule. Schedule changes for the Intersection Capacity Improvement Project were approved using the change order process – for example, change order number three added additional time and cost due to unforeseen field conditions – this included a stormwater structure alignment that needed to be updated because of a survey error and a conflict with a new stormwater pipe because an existing water line was shallower than expected. The five (5) projects that have been completed were completed at a reasonable cost. A competitive bidding process provides a fair representation of the market value of the services that were provided. For each of these projects, MGT reviewed documentation and determined that all five projects went through the competitive bidding process and the vendor selected provided reasonable assurance that the cost was reasonable – either the lowest qualified option or within the ranges of costs submitted. 11.D.2 Packet Pg. 668 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-5 MGT also reviewed change orders associated with these projects to assess whether the reason(s) for the change orders appeared reasonable. MGT concluded that the change orders received appropriate oversight and authorization. There were no prior adverse audit findings for this segment of County operations relevant to this surtax. FACILITIES MANAGEMENT The Division of Facilities Management is comprised of 10 major functions: Building Management; Facilities Capital Renovations and Construction; Space Planning and Allocation; Grounds Management; Janitorial Services; Building Operations; Security; Real Property; Conservation Collier; and Indoor Air Quality. The Division is responsible for the maintenance of all County- owned and -operated buildings including some leased structures. Additionally, the Division is responsible for managing an operation and capital budget of $19.15 million, of which $5.15 million is for capital construction. Included below are summaries of the roles of each of these functions in County operations. Management and Oversight: Responsible for the overall management and direction for the Facilities Management Division. This program drives the Division's vision and objectives through the utilization of short- and long-term strategic planning, financial planning, energy management, annual update and inventory reporting, master space planning, and emergency management planning. Directs the functions and activities of the Division, including Building Management, Construction Management, Real Property Management, and Government Security. Building Repair and Maintenance: Responsible for the logistical management, maintenance, financial compliance, sustainability and condition assessment of Collier County government buildings and structures. Building management costs include operating, personnel, and capital expenses. Through continuously improving preventative and predictive maintenance programs, Facilities Management strives to provide safe, secure, and well-maintained facilities that are accessible to all persons. This section: ─ Manages the maintenance functions and activities of the Division, including electrical, low-voltage, plumbing, heating, ventilation, and air conditioning (HVAC), structural repairs, physical energy plant, pest control, as well as fire systems maintenance and compliance; ─ Coordinates the preventative maintenance programs for the County's structures and building related assets, which in return avoids emergency repairs and prevents loss of public services and County staff productivity; and ─ Ensures County facilities are clean, safe, and productive through indoor air quality services, which include investigations and remediation. Capital Construction/Renovation: Responsible for the management of Collier County vertical construction and renovation projects that provide high-quality, best-value 11.D.2 Packet Pg. 669 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-6 government facilities to residents, visitors, and staff. This section delivers project management services to the Board of County Commissioners as well as the constitutional offices that include the Clerk of the Courts, Supervisor of Elections, Property Appraiser, Tax Collector, and the Collier County Sheriff's Office. It also provides in-house construction administration services, and project management for BCC-owned and -leased facilities, including new vertical construction, space renovations, roof replacements, HVAC system replacements, and warranty work. Campus Utilities: Provides funds for payments to utility companies for portions of electrical, trash, water and sewer costs for County facilities. Contract Services: Provides clean, safe, and productive work environment for the residents, visitors, and staff, through collaboration between County staff and contracted vendors. Custodial services deliver competitive janitorial cleaning, trash removal, and recycling services to 132 buildings. Grounds maintenance provides competitive landscape services to the County's main campus and 47 satellite properties, including irrigation, fertilization, and mulching. Government security delivers the necessary resources for the detection of contraband and the protection of residents, visitors, employees, judges, and elected officials. Government Security is comprised of security checkpoint staffing, interior and exterior patrols, along with security building audits for the Main Courthouse and Government Center, Building F, Building H, lmmokalee Government Center, North Collier Government Center, GMO Planning and Regulation, and the Emergency Services Center. The Division additionally provides contract maintenance services for HVAC preventative maintenance, water system maintenance, pest control, elevator maintenance, air filter replacements, and fire system certifications. Government Security: Provides the necessary resources for detection of contraband and the protection of judiciary officials, elected officials, employees, and visitors with optimum customer service. This includes, but is not limited to, security checkpoint staffing as well as interior and exterior foot patrols at county facilities, specifically the Main Courthouse and Government Center, Building F, Building H, lmmokalee Government Building, North Collier Government Center, and the Emergency Service Center. Real Property Management: Provides land acquisition services to County client departments. The Real Estate Services section of Facilities Management Division is responsible for the negotiation and purchase of land, except right of way land purchases, for client County departments. Some of the key activities of this section are: ─ Researches to identify land owners, communication with land owners and the County Attorney’s Office regarding land purchases. Prepares market analysis, obtains appraisals from internal and external appraisers, if necessary, based on purchase amount. ─ Negotiates between land owner and County client that funds the land purchase. 11.D.2 Packet Pg. 670 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-7 ─ Requests environmental studies, reviews zoning, and obtains approvals needed for anticipated County uses, prepares contract, obtains land owner’s signature, prepares Executive Summary and submits to BCC for approval and contract execution, BCC approves. ─ Researches and obtains removal of all encumbrances, prepares closing documents, requests funds, closes and records documents, orders title policy, releases site to client and closes file. New construction facilities-related projects are initiated by growth management plans, land development code, citizen requests, population growth, and other relevant factors. Projects are prioritized by life and health safety, revenue-generating budget availability, and enhancement of quality of life for residents. Depending on the project size, the project manager, in-house inspection, or contracted CEI services can all monitor large construction projects. Repair and maintenance functions include repair and maintenance of roofs, HVAC, and general building repairs. As part of audit testing, MGT selected a sample of 20 projects that were, or are being, managed by the Facilities Management Division during the period June 1, 2015, through May 31, 2018 (see Table 2 - Summary of Project Sample for Facilities Management below). TABLE 2 - SUMMARY OF PROJECT SAMPLE FOR FACILITIES MANAGEMENT PROJECT NAME ESTIMATED COST ACTUAL COST TO DATE PROJECT SCOPE PROJECT STATUS Eagle Lakes Community Aquatic Center $9,230,657 $8,471,760 Aqua Center In-Process Sherriff's Office Orange Tree Substation $2,487,411 $2,487,411 Sherriff's Off Complete EMS 76 Construction $1,546,697 $1,546,697 EMS Unit Complete Cocohatchee River Park Marina Renovation $1,391,000 $1,374,777 Marina Reno In-Process Big Corkscrew Island Regional Park $3,631,979 $1,156,656 Park In-Process Base Bid Administration Building $986,537 $986,537 Renovation Complete CH 1st Floor Phase I Probation Offices $924,443 $924,443 Probation Off Complete CH 1st Floor Phase II Courtroom $920,848 $920,848 Courtroom Complete Freedom Memorial Monument $766,814 $766,814 Monument Complete 11.D.2 Packet Pg. 671 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-8 PROJECT NAME ESTIMATED COST ACTUAL COST TO DATE PROJECT SCOPE PROJECT STATUS East Naples Community Park Pickle Ball $744,018 $744,018 Pickle Ball Crt Complete DMP for Granit for Freedom Park $682,957 $682,957 DMP-Granite Complete Clam Pass Bch Park Electrical Upgrade $603,500 $574,106 Electric Upgd In-Process NITY Park Soccer Field $573,516 $573,516 Soccer Field Complete Clam Pass Parking Renovations $506,464 $506,464 Parking Reno Complete Clam Pass Boardwalk Repair $498,084 $498,084 Boardwalk Re Complete Immokalee Fitness Center Expansion $354,477 $354,477 Fitness Ctr Ex Complete ENCP Pickle Ball Court $345,756 $345,756 Pickle Ball Crt Complete Elevator Modernization Support CC Court $175,596 $175,596 Elevator Mod Complete Architect and Engineering Services $105,675 $72,375 Engineering In-Process 5 Microsoft Office Professional Plus $1,561 $1,561 Software Lic. Complete MGT interviewed County personnel and reviewed supporting documentation for each project (e.g., executive summaries, monthly estimate reports, invoices, appraisals and other relevant information) to gain an understanding of the project requirements, performance (e.g., quality of the work was acceptable and tasks were completed on-time), and cost. Audit procedures disclosed that: For all 20 projects, management evaluated project performance and cost using information that was adequate to do so. For all 20 projects the performance management appeared reasonable. The projects are monitored regularly through on-site inspections as well as progress meetings. Once complete, projects are evaluated for compliance with the contract. Progress is also reviewed by program administration before approving payments to the project contractors. The 15 completed projects were completed on-time and within budget when taking into consideration change orders. For some projects, there were unforeseen conditions or scope additions that required additional time or cost to complete. For such projects, MGT reviewed the change orders related to these projects and determined that there were unforeseen conditions or scope additions that required additional time or cost to complete and the additional time or cost to complete the 11.D.2 Packet Pg. 672 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-9 project appeared reasonable (e.g., for the Freedom Memorial Monument project, change order 1 reduced the cost of the project because the County decided to purchase the granite for the monument directly, which resulted in substantial sales tax savings). The 15 completed projects were completed at a reasonable cost. A competitive bidding process provides a fair representation of the market value of the services that were provided. For each of these projects, MGT reviewed documentation and determined that all 15 projects utilized the competitive bidding process. The projects all received multiple bids, and the lowest bid was the one chosen for all of the projects. Since the projects were bid competitively, we can infer that the project costs were at the current market value at the time the projects were procured. Additionally, where information was available, project costs were compared to the cost of similar projects in other counties. For example, Collier County constructed an EMS Station at an average cost per square foot of $290.68, compared to Lee County in which an EMS Station was completed at an average cost per square foot of $467. MGT also reviewed change orders associated with these projects to assess whether the reason(s) for the change orders appeared reasonable. MGT concluded that the change orders received appropriate oversight and authorization. MGT also selected two (2) land purchases performed by the Real Estate Services section of the Facilities Management Division for testing (see Table 3 – Land Purchases). TABLE 3 – LAND PURCHASES PROJECT NAME AVERAGE APPRAISAL PURCHASED PRICE PURCHASED OVER/UNDER AVERAGE APPRAISAL Land Purchase- FGUA Utility Acquisition $21,056,642 $20,936,642 Under - $120,000 Land Purchase- Sports Park-City Gate $14,195,000 $12,000,000 Under - $2,195,000 For these two (2) land purchases, MGT interviewed the Manager of the Real Estate Services section, reviewed policies and procedures, flowcharts, executive summaries, appraisals, and other relevant documents to gain an understanding of the land purchasing process (see Exhibit 1 – Property Acquisition Process). This allowed a determination of whether the land purchases followed stated procedures, were completed at a reasonable cost, and approved by the Board of County Commissioners (BCC). 11.D.2 Packet Pg. 673 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-10 EXHIBIT 1 – PROPERTY ACQUISITION PROCESS (Source: Real Estate Services Section, Facilities Management Division) 11.D.2 Packet Pg. 674 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-11 MGT concluded that: Due to the dollar amount of the purchases, outside appraisals were required by policy (i.e., market analysis indicates a value of over $100,000). A mix of internal and external appraisals were used to determine market value of the land purchases. These land purchases followed internal policies and procedures based on the amounts of the purchases. Both purchases were acquired below the average appraised value. Both purchases were approved by BCC. MGT reviewed relevant internal and external audit reports (e.g., Comprehensive Annual Financial Reports, Single Audit Reports, and reports issued by the Collier County Internal Audit Department of the Clerk’s Office) to gain an understanding of the deficiencies identified relevant to our audit objectives. The Collier Counter Clerk’s Office issued Audit Report 2017-3 Facilities Management Division: 2015 Fiscal Year-End Inventory on February 22, 2017. In this report, deficiencies were found regarding inventory controls, proper inventory counts and a lack of controls around consumables. In response to these findings, new policies and procedures were instituted, additional staff was hired to comply with the new procedures and a new inventory control system is being implemented this coming fiscal year. Based on these actions, MGT concluded that it appears that program administrators took reasonable and timely action to address the prior findings identified. FINDING 2: STRUCTURE OR DESIGN The Transportation Engineering and Facilities Management programs’ organizational structures have clearly defined units, minimize overlapping functions and excessive administrative layers, and have lines of authority that minimize administrative costs. Additionally, current staffing levels appear reasonable given the nature of the services provided and program workload based on a thorough budgeting and staff planning process; however, the County could undertake further efforts to measure workload and productivity to validate staffing levels against volume of need. TRANSPORTATION ENGINEERING As of July 31, 2018, the Transportation Engineering Division consisted of approximately 68 employees under the direction of the Department Head who directly reports to the Deputy County Manager (see Exhibit 2 – Transportation Engineering Organizational Chart). The Transportation Engineering Division is responsible to maintain safe traffic operation on the County's roads, implement capital improvements for the transportation network, and to acquire right of way property for capital programs. The Transportation Engineering Division utilizes a combination of in-house staff and contracted vendors to perform its functions. 11.D.2 Packet Pg. 675 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-12 EXHIBIT 2 – TRANSPORTATION ENGINEERING ORGANIZATIONAL CHART FACILITIES MANAGEMENT PROGRAMS As of July 31, 2018, the Facilities Management Division consisted of approximately 64 employees under the direction of the Department Head who directly reports to the Deputy County Manager (see Exhibit 3 – Facilities Management Organizational Chart). The Facilities Management Division is responsible for the maintenance of all County-owned and operated buildings including some leased structures, and to acquire needed property for capital programs. The Facilities Management Division utilizes a combination of in-house staff and contracted vendors to perform its functions. 11.D.2 Packet Pg. 676 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-13 EXHIBIT 3 – FACILITIES MANAGEMENT ORGANIZATIONAL CHART EVALUATION AND FINDINGS As it relates to the Transportation Engineering and Facilities Management programs organizational structures and designs, MGT’s audit procedures included: Observations of a budget process that reviews workload and Full-Time Equivalent (FTE) levels, which is brought forward from department leaders and approved by the Board. Observations of sample job / position descriptions to ensure minimal duplication of effort. The review of organizational charts relative to peer counties (identified by Collier County management as Broward, Lee, and Monroe) to confirm that other peers have similar departments and management levels. Interviews with HR management to ensure the fidelity to established processes. 11.D.2 Packet Pg. 677 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-14 Audit procedures revealed that even though the County does not go through workload analysis or specific individual utilization reviews, they consider staffing levels throughout the year, which are summarized and reviewed by management, public, and the BCC annually. The County demonstrates thoughtfulness in the process of staffing levels by going through an annual budget process, including FTE review per department, and both the budget and salary schedule (i.e., Pay & Classification Plan for FY2018) are reviewed and approved by the Board. The charts and descriptions provided as Exhibits 4 – Employment Summary and Exhibits 5A through 5D – Fiscal Year 2018 Adopted Budget below show the employment summary, budgeting and FTE process (from Collier County budget documentation), respectively. This information is publicly available, is open for public comment, and ensures that management is reviewing staffing levels annually with Board approval. Additionally, the County’s program budgets provide a brief description of the program, the priority of each program in a department, the number of FTE positions necessary to perform the program, Fiscal Year (FY) dollars necessary for the program, offsetting revenues generated by each program, and the net cost of each program. The administration/overhead program encompasses the minimum level of service that is mandated by Federal or State law or judicial order and is necessary to protect the health and safety of the County residents or necessary to maintain capital asset value for a department. With regards to expanded positions, the County Manager’s Agency added 41 FTEs to the operation as part of the FY 2018 approved budget. These positions were distributed relatively equally throughout the agency reflecting the continued need to invest in human capital among various strategic position categories to address service demands and agency initiatives. As part of the decision to make major organizational, service or other changes, an analysis is undertaken by the County (executed at the division level but managed by Human Resources) that includes review of the customer needs, the organizational structure, the underlying processes and service delivery models and the proper full-time equivalent employee mix. Outcomes included streamlined business processes, elimination of any wasted effort in the processes, and a management and staffing structure that is expected to be able to deliver the required services. For FY 2019, departments will carefully consider expanded positions since proposed operating expenditure guidance will likely require a significant re-prioritization of current budget. Any expanded requests will be limited to mission critical functions, such as but not limited to capital project execution, asset maintenance and replacement execution, asset management implementation and front-line service delivery. All expanded positions and programs will be reviewed by the County Manager and his recommendations will be presented as part of FY 2019 budget workshop discussions in June. Additionally, expanded position requests will be limited to mission critical functions, fully vetted with the Board and enumerated within the Budget document including details of expanded operational costs and any offsetting program revenue. Based on the information reviewed, MGT confirmed that the Department’s budgeting and staff planning processes appear reasonable given the nature of the services provided and program workload and promote the accomplishments of program goals and objectives by considering 11.D.2 Packet Pg. 678 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-15 staffing levels throughout the year and addressing staffing levels per strategic program goals. However, the County could undertake further efforts to measure workload and productivity to validate staffing levels against volume of need. EXHIBIT 4 – EMPLOYMENT SUMMARY 11.D.2 Packet Pg. 679 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-16 EXHIBIT 5A – FISCAL YEAR 2018 ADOPTED BUDGET 11.D.2 Packet Pg. 680 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-17 EXHIBIT 5B – FISCAL YEAR 2018 ADOPTED BUDGET (CONTINUED) 11.D.2 Packet Pg. 681 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-18 EXHIBIT 5C – FISCAL YEAR 2018 ADOPTED BUDGET (CONTINUED) 11.D.2 Packet Pg. 682 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-19 EXHIBIT 5D – FISCAL YEAR 2018 ADOPTED BUDGET (CONTINUED) Additionally, MGT reviewed management staffing levels (i.e., Administrators, Directors, and Managers) to ensure Collier aligned with peer counties to test that there was not excessive overlap of management positions and similar positions across peer counties. A chart of management positions relative to peer counties is provided as Table 4 – Comparison of Management Titles & Positions below. As shown in the table, the peer counties have positions that align with those of Collier County in number; however, differences in titles obscure whether these positions have similar functions. As noted, further examination of these functions’ workload and productivity could help to assess the operational efficiency of the program. 11.D.2 Packet Pg. 683 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-20 TABLE 4 – COMPARISON OF MANAGEMENT TITLES & POSITIONS ORG CHART TITLE COMPARISON - FACILITIES MANAGEMENT Collier County Management Titles Lee County Management Titles Monroe County Management Titles Broward County Management Titles County Administrator County Administrator Public Works Director Public Works Director Public Works Director Public Works Director Deputy Public Works Director Facilities Management Director Project Manager Facility Manager Project Manager Construction Project manager ORG CHART TITLE COMPARISON – GROWTH MANAGEMENT DEPARTMENT Collier County Management Titles Lee County Management Titles Monroe County Management Titles Broward County Management Titles Department Head - Growth Management Department Director, Community Development Dir. of Planning & Environmental Resources Director - Environmental Protect. & Growth Management Director, Transportation Engineering Division Manager, Development Services Asst. Dir. of Planning & Environmental Resources Director - Planning & Development Management Principal Project Manager Manager, Zoning Development Review Manager Construction Project manager 11.D.2 Packet Pg. 684 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-21 This review of the Transportation Engineering and Facilities Management Divisions’ structures and designs showed staffing levels reviewed throughout the year and addressing staffing levels per strategic program confirmed that: The organizational structures have clearly defined units, minimize overlapping functions and excessive administrative layers, and have lines of authority that minimize administrative costs. The current process to budget and plan for staffing levels appeared to be reasonable based on the nature of the services provided, but would benefit from further benchmarking to validate FTE allocations versus need. RECOMMENDATION: MGT recommends that the County incorporate further measures of workload or productivity to validate the staffing levels of the organization against need. FINDING 3: METHODS OF PROVIDING SERVICES AND PRODUCTS The overall execution of the 8 Transportation Engineering related projects and 20 Facilities Management related projects indicate that these projects have been executed efficiently with a mix of in-house and external help. However, the programs do not have a formal process for evaluating the effectiveness of alternative methods of providing services including in-house, contracted, and privatized services. TRANSPORTATION ENGINEERING The Transportation Engineering Division currently uses several alternative methods of delivering services to realize cost savings, including performing the design of certain projects in-house. Per County personnel however, due to limited internal resources, all construction projects are outsourced to qualified contractors/vendors. MGT selected a sample of eight (8) projects that were, or are being, performed by the Transportation Engineering Division as described in Finding 1: Economy, Efficiency, and Effectiveness. These projects included projects that were in the design and construction stages, as well as projects that were completed, and included varying types of engagements including construction of roads, bridges, and sidewalks. For each of these, MGT interviewed County personnel and reviewed supporting documentation stored within their records to gain an understanding of the service delivery methods used for each project. MGT also reviewed documentation to determine whether there was evidence that, for services or activities performed in-house, management considered alternative service delivery methods and, for contracted/privatized service or activities, that management verified effectiveness and cost savings achieved. Audit procedures disclosed that: The design of two (2) of the projects selected for testing was/is being performed by in-house staff. In response to audit inquiries, County personnel indicated that the 11.D.2 Packet Pg. 685 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-22 Transportation Engineering Division internally performs design projects that are estimated to be less than $1,000,000 in construction costs. Although alternative methods of providing services are often discussed and used, there is no formal process or documentation to support that the most cost-effective method was chosen, when a choice is available. Conditions that determine whether a project can be performed in-house include Chapter 336, Florida Statutes, which requires certain construction projects to be outsourced to contractors and whether the County has the resources (e.g., human capital and equipment) required to perform the task. FACILITIES MANAGEMENT Per County personnel, due to limited internal resources, all design and construction activities are outsourced to qualified vendors and the Division manages these contracts. MGT selected a sample of 20 projects that were, or are being, performed by the Facilities Management Division as described in Finding 1: Economy, Efficiency, and Effectiveness. These projects were in various stages of completion and included projects related to parks, governmental facilities, and emergency facilities. For these 20 projects, MGT interviewed County personnel and reviewed supporting documentation stored within their records to gain an understanding of the service delivery methods used for each project. Audit procedures disclosed that: Two (2) of the projects selected for testing were direct material purchases. Although alternative methods of providing services are often discussed and used, there is no formal process or documentation to support that the most cost-effective method was chosen (e.g., designing the projects in-house rather than outsourcing). In response to audit inquires, County personnel indicated that it is often more cost-effective to use in-house staff to provide services than to use alternative methods. However, MGT was not provided documentation to support this conclusion by management. The absence of a formal process for periodically evaluating in-house, contracted, and privatized services increases the risk that cost savings and program efficiency may not be realized. The Real Estate Services section of the Facilities Management division uses a combination of in- house and contracted services to manage the land acquisition process depending on the nature of the purchase. For example, internal policies and procedures require obtaining one outside appraisal if the market analysis indicates a value of $100,000-$499,999 and two outside appraisals if the market analysis indicates a value over $500,000. RECOMMENDATION: MGT recommends that management implement procedures to document and periodically evaluate all services provided and determine whether alternative service delivery methods have the potential to reduce costs without significantly affecting the quality of services. 11.D.2 Packet Pg. 686 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-23 FINDING 4: GOALS, OBJECTIVES AND PERFORMANCE MEASURES The Transportation Engineering and Facilities Management programs’ goals and objectives are clearly stated and are consistent with the County’s strategic plan. Management uses adequate measures to evaluate program performance and cost. Additionally, the internal controls evaluated by the audit team are adequate to provide reasonable assurance that program goals and objectives are met. TRANSPORTATION ENGINEERING Per the County’s website, the focus of the Transportation Engineering Division is to maintain safe traffic operation on the County's roads, implement capital improvements for the transportation network, and to acquire needed property for capital programs. The Five-Year Work Program is a key document for the division’s planning. On an annual basis, the Transportation Five-Year Work Program is included in the AUIR presented to the BCC. The Five-Year Work Program contains information on capital construction and operations improvements projects. The information presented in the Five-Year Work Program includes an analysis of the existing conditions of the transportation system in the County and road financing plan updates. The Five-Year Work Program is the document that drives the Transportation Engineering strategy for the County for the upcoming five-years. In addition, the County has developed a Master Mobility Plan (MMP) to address the transportation mobility needs of the County. The MMP is specifically focused on demand management and coordination to reduce the need for transportation infrastructure. MGT interviewed County personnel and performed a variety of research to gain an understanding of the program’s goals and objectives. Based on the results of our audit procedures, we were able to identify five (5) goals and related objectives and performance measures (see Table 5 – Transportation Engineering Goals, Objectives and Performance Measures). The Transportation Engineering Division has established five broad goals related to its functions. The goals address the Division’s role in meeting or exceeding the expectations of the Five-Year Work Program, construction projects completion, and maintenance of traffic signs and signals. Each goal has a set of objectives that establishes expectations for the goal as well as multiple performance measures that, taken together, provide reasonable basis to assess whether the objectives have been met. TABLE 5 – TRANSPORTATION ENGINEERING GOALS, OBJECTIVES AND PERFORMANCE MEASURES GOALS OBJECTIVES PERFORMANCE MEASURES 1. Meet or exceed expectations for the 5-year work plan a) Complete 100% of programmed design phases for 5-year work plan • % of programmed projects completed for 5-year work plan 11.D.2 Packet Pg. 687 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-24 GOALS OBJECTIVES PERFORMANCE MEASURES 2. Construction projects are on time a) Construction projects are delivered within 20% of time schedule. • % of construction projects that were delivered within 20% of contract time 3. Construction projects are within budget a) Construction projects are delivered within no more than 10% over project budget • % of construction projects that were delivered with no more than 10% over project budget 4. Traffic signs are maintained in good condition a) Replace and upgrade all signs that have a condition rating of 2 or below (out of 5) when inspected • % of signs replaced for regular maintenance according to condition rating 5. Traffic signals are maintained in good condition a) To respond to emergency signal repairs within one hour b) To review or retime 25% of traffic signals each year c) Staff traffic management 11 hours per day • % of emergency signal repairs responded to within one hour • % of traffic signals reviewed or retimed • # hours per day traffic management was staffed MGT also obtained and reviewed the County’s strategic plan to gain an understanding of the County wide strategy and determine if the program’s goals and objectives are consistent with the County’s strategic plan. The review disclosed one (1) strategic goal and related objectives that is consistent with the goals and objectives identified for the Transportation program. (See Table 6 – County Strategic Goal Related to Critical Infrastructure and Capital Assets). For example, the transportation program goals support the County’s strategy to responsibly plan, construct, and maintain the County’s critical public infrastructure and capital assets to ensure sustainability for the future. TABLE 6 – COUNTY STRATEGIC GOAL RELATED TO CRITICAL INFRASTRUCTURE AND CAPITAL ASSETS STRATEGIC GOAL OBJECTIVES 1. To responsibly plan, construct and maintain the County’s critical public infrastructure and capital assets to ensure sustainability for the future. a) To optimize the useful life of all capital assets and critical public infrastructure. b) To provide appropriate, timely, best-value public facilities and infrastructure that meet both current and future demands. c) To mitigate the impacts of potential disasters on critical infrastructure. 11.D.2 Packet Pg. 688 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-25 MGT identified and evaluated significant internal controls within the context of the audit objectives. Audit procedures performed to evaluate internal controls included interviewing appropriate personnel, flowcharting processes, and reviewing documentation for evidence of proper approvals (e.g., Board approvals). Audit procedures disclosed that the program has a process and internal controls that promote the achievement of program goals and objectives. MGT’s review confirmed that: The Transportation Engineering Division goals and objectives are clearly stated and consistent with the County’s strategic plan. The measures used by management to evaluate program performance and cost are adequate to assess program progress toward meeting its stated goals and objectives. The internal controls evaluated appear to be adequate to provide assurance that the program will be able to achieve its goals and objectives. FACILITIES MANAGEMENT Per the County’s website, the mission of the Facilities Management Division is to deliver to the residents and visitors local government services that exceed expectations and its vision is to be the most responsive, technically proficient and effective team in the facilities management field. On an annual basis, the County is required to prepare and present to the BCC the AUIR and adopt a five-year CIE. The CIE is the foundation of the County’s annual CIP, which includes projects of the Facilities Management division. As previously indicated, the Real Estate Services (RES) section within Facilities Management is charged with securing land and land rights necessary for the construction of County infrastructure and supporting facilities. MGT interviewed County personnel and performed a variety of research to gain an understanding of the programs’ goals and objectives. Based on the results of our audit procedures, we were able to identify six (6) goals and related objectives and performance measures for the Facilities Management program and four (4) goals and related objectives and performance measures for the Land Acquisition program (see Table 7 – Facilities Management and Land Acquisition Goals, Objectives and Performance Measures). The goals address the Facilities Management and Land Acquisition programs’ role in the construction and maintenance of critical public infrastructure and management of community growth, respectively. Each goal has a set of objectives that establishes expectations for the goal as well as performance measures that, taken together, provide reasonable basis to assess whether the objectives have been met. 11.D.2 Packet Pg. 689 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-26 TABLE 7 – FACILITIES MANAGEMENT AND LAND ACQUISITON GOALS, OBJECTIVES AND PERFORMANCE MEASURES FUNCTION GOALS OBJECTIVES PERFORMANCE MEASURES Facilities Management 1. Efficiently complete work orders. a) To efficiently complete work orders within five (5) business days. • # of days to complete work orders. • # of work orders over 30 days old. Facilities Management 2. To have licensed and knowledgeable trades workers. a) To have licensed and knowledgeable trades workers. • # of Licensed Trades workers. Facilities Management 3. Efficiently maintain records of assets and inventory. a) To have accurately recorded and identified County assets and inventory. • Perform annual inventory and asset count. • Spot check inventory and asset count for accuracy with requirement of 95% or greater accuracy. Facilities Management 4. Ensure work orders are effectively addressed. a) To inspect closed work orders and ensure they are closed out at the highest quality. • 95% or greater work orders inspected with no issues identified. Facilities Management 5. Ensure accuracy of work order documentation. a) To ensure work orders are closed out properly with accurate labor hours, parts, invoices, notes, and assets. • 95% or greater work orders inspected with no issues identified. Facilities Management 6. Projects are completed within Budget and Deadline. a) To ensure project is completed within budgetary allowance. b) To ensure project is completed within established deadlines. • # of change orders issued. • $ value over budget. • # of days passed deadline. 11.D.2 Packet Pg. 690 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-27 FUNCTION GOALS OBJECTIVES PERFORMANCE MEASURES Land Acquisition 7. Efficiently and effectively acquire land for County purposes and dispose lands designate as surplus. a) To close real estate transaction within 120 days pursuant to Florida Statutes and County policies and procedures. b) To follow all appraisal requirements pursuant to Florida Statutes and County Ordinances. c) Clear all encumbrances on property acquisitions to reduce the County’s liability. d) To ensure monetary compensation for acquisitions and dispositions are best value for transactions. • # days to close RE transactions • # of land interests acquired • # of appraisals prepared and reviewed Land Acquisition 8. Efficiently & effectively complete lease requests for the County as Tenant and Landlord a) To efficiently secure leased space for County as Tenant pursuant to Florida Statutes and County policies and procedures. b) To efficiently process requests and leases with County as Landlord pursuant to Florida Statues and County policies and procedures. • # days to complete lease requests 11.D.2 Packet Pg. 691 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-28 FUNCTION GOALS OBJECTIVES PERFORMANCE MEASURES c) To ensure that the monetary compensation for transactions is based on market value. Land Acquisition 9. Efficiently & effectively manage leased property for the County a) As Tenant, to oversee that lease provisions are adhered to by both parties. b) As Landlord, to ensure that the lease terms are adhered to. • # square feet managed for leased space Land Acquisition 10. Effectively respond to internal and external inquiries a) To research and provide detailed information to all requests within 8 business hours, dependent on the complexity of the inquiry. • # of informational requests replied to MGT also obtained and reviewed the County’s strategic plan to gain an understanding of the County wide strategy and determine if the programs’ goals and objectives are consistent with the County’s strategic plan. The review disclosed two (2) County strategic goals and related objectives that are consistent with the goals and objectives identified for the Facilities Management and Land Acquisition functions. (See Table 8 – County Strategy Goal Related to the Facilities Management and Land Acquisition Functions). For example, the Facilities Management goals support the County’s strategies to responsibly plan, construct and maintain the County’s critical public infrastructure and capital assets to ensure sustainability for the future. 11.D.2 Packet Pg. 692 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-29 TABLE 8 – COUNTY STRATEGY GOAL RELATED TO THE FACILITIES MANAGEMENT AND LAND ACQUISITION FUNCTIONS STRATEGIC GOAL OBJECTIVES 1. To responsibly plan, construct and maintain the County’s critical public infrastructure and capital assets to ensure sustainability for the future. a) To optimize the useful life of all capital assets and critical public infrastructure. b) To provide appropriate, timely, best-value public facilities and infrastructure that meet both current and future demands. c) To mitigate the impacts of potential disasters on critical infrastructure. 2. To responsibly plan and manage community growth, development, redevelopment, and protect the natural environment a) Enforce current development standards and maintain relevant plans that reflect the needs and desires of a growing community. b) Conserve, preserve, monitor, and manage natural resources in partnership with external stakeholders. c) Manage development and redevelopment in harmony with efficient mobility, habitat preservation, water resource management and a sustainable ecology. d) Evaluate, monitor, and plan for the effects of sea level rise. e) Develop integrated and sustainable plans that protect and manage the natural environment, water resources, and solid waste. MGT identified and evaluated significant internal controls within the context of the audit objectives. Audit procedures performed to evaluate internal controls included interview with appropriate personnel, flowcharted processes, and review documentation for evidence of proper approvals (e.g., Board approvals). Audit procedures disclosed that the program has a process and internal controls that promote the achievement of program goals and objectives. MGT’s review confirmed that: The Facilities Management and Land Acquisition programs goals and objectives are clearly stated and consistent with the County’s strategic plan. The measures used by management to evaluate the programs’ performance and cost are adequate to assess the programs’ progress toward meeting its stated goals and objectives. The internal controls evaluated appear to be adequate to provide assurance that the programs will be able to achieve their goals and objectives. 11.D.2 Packet Pg. 693 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-30 FINDING 5: ADEQUACY OF PUBLIC DOCUMENTS AND REPORTS The Transportation Engineering and Facilities Management programs have processes in place to ensure the accuracy and completeness of relevant program performance and cost information provided to the public. Additionally, the public has access to information that is useful, readily available and easy to locate. TRANSPORATION ENGINEERING Pursuant to Section 119.01, Florida Statutes, all State, county, and municipal records are open for personal inspection and copying by any person and providing access to public records is a duty of each agency. As such, citizens can obtain County information by submitting a public record request. In addition to public records request, the Transportation Engineering Division provides information to the public via its website. MGT interviewed County personnel to gain an understanding of the information that is readily available to the public via the website. The process for posting information on the website is described below: Each Project Manager (PM) is responsible for generating the information provided on the webpage. The PM forwards the information to the operations administrative assistant. The administrative assistant reviews, formats, dates, and then posts the information to the website. After the information is posted to the website, the PM again reviews for accuracy. If the PM notices information is not up to date, he provides the most updated information to the operations administrative assistant and the information on the website is updated. MGT also researched the Transportation Engineering website to gain an understanding of the information that is readily available to the public. The research disclosed that: The Transportation Engineering’s webpage provides general overviews of the major road, bridge, intersection and sidewalk projects that are in design or construction. When a Public Information Meeting is held on a project, the meeting notice and often the graphics displayed at the meeting are posted. The project specific information posted on the website included information on the Vanderbilt Beach Road project, which is one of the eight (8) projects that were selected for testing as described in Finding 1: Economy, Efficiency, and Effectiveness. The project specific information for the Vanderbilt Beach Road project on the website includes: ─ project description; ─ status update (e.g., percent of completion); ─ status of project funding; and 11.D.2 Packet Pg. 694 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-31 ─ the slide show from the public information meeting held on June 26, 2018 (the slide show includes information related to project goals and schedule). MGT compared the information posted on the website to relevant information provided by the County for the specific project and determined that the information posted on the website related to the Vanderbilt Beach Roach project appears to be accurate. Audit procedures confirmed that the program has processes in-place to ensure that the public has access to program performance and cost information that is useful, readily available and easy to locate. FACILITIES MANAGEMENT As indicated above, all the County’s records that are subject to public records request are open for personal inspection and copying by any person and providing access to public records is a duty of each agency. When a citizen or visitor request public information, the request is communicated by a Public Information Officer. The Project Manager of the project associated with the request works with the Communication and Customer Relations Division to provide the appropriate documentation. In addition to public records request, the Facilities Management Division provides information to the public via its website. MGT inquired with County personnel to gain an understanding of the information that is available to the public on the website. Per County personnel: There are two administrators within the Facilities Management Division that manage the Division’s website. The corresponding manager reviews the information on the website for accuracy. Additionally, all information is reviewed and approved by the corresponding director or department head after the manager’s approval. MGT researched the Facilities Management division (which includes the RES section) website to gain an understanding of the information that is readily available to the public. The research disclosed that: The Facilities Management’s webpage provides general overviews of the major projects that have been completed and on-going during the current fiscal year. The website gives the public the opportunity to submit service requests or complaints online. The website also has project specific information on certain projects, such as the Courthouse Annex and Chiller Plant Expansion project; BCC Fleet Management project; and CCSO Special Operations project. The information on these projects include: ─ designer, 11.D.2 Packet Pg. 695 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-32 ─ construction contractor, ─ project manager, ─ budget, ─ estimated construction cost, ─ square footage, ─ design start date, ─ construction start date, ─ anticipated construction completion date, and ─ photos of the site. The RES section of the website provides general information on the responsibilities of the Property Acquisition, Property Leasing, and Real Estate Appraising teams. In addition, the website provides contact information of County personnel that can be contacted by any individual or organization that is interested in buying, selling, or leasing real estate to/from the County In addition to the three projects referenced above, the website also included links to major construction projects for this fiscal year. Two (2) of the major construction projects for this year were projects that were included in our sample of projects tested as described in Finding 1: Economy, Efficiency, and Effectiveness. For these two (2) projects, the audit team researched the County’s website to determine what, if any, information was readily available and easy to locate. Audit procedures disclosed that the two projects were listed on the Parks and Recreation Division’s Capital Projects and Descriptions list. The list includes: an update from the project manager, projected substantial completion date, status, and next critical milestone. Audit procedures confirmed that the program has processes in-place to ensure that the public has access to program performance and cost information that is useful, readily available and easy to locate. FINDING 6: PROCESS FOR ENSURING COMPLIANCE WITH POLICIES, RULES, AND LAWS The Transportation Engineering and Facilities Management programs have a process in-place to assess their compliance with applicable federal, state, and local laws, rules, and regulations; contracts; grant agreements; and local policies. In addition, the programs have taken reasonable and timely actions to assess if planned uses of the surtax comply with applicable state laws, rules, and regulations. 11.D.2 Packet Pg. 696 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-33 TRANSPORTATION ENGINEERING AND FACILITIES MANAGEMENT PROGRAMS MGT identified and evaluated significant internal controls and processes in-place to assess the programs’ compliance with applicable federal, state, and local laws, rules, and regulations; contracts; grant agreements; and local policies. Examples of audit procedures performed to evaluate internal controls included: interviews with personnel and flowcharted processes, review of contracts, approvals from the BCC, competitive bid process, and review of invoices. In accordance with County policy, the program’s Five-Year Work Program is updated annually and presented to the BCC for review and approval. Per County personnel, all engineering work related to road and bridges and prepared by contractors and consultants hired by the Transportation Engineering program follow standards and requirements promulgated by the: Florida Department of Transportation (FDOT), Federal Highway Administration (FHWA), American Association of State Highway and Transportation Officials (AASHTO), and County. The land acquisition process (see Exhibit 1 – Property Acquisition Process) is governed by Board policies and the Florida Statutes, including: Policies & Procedures Concerning the Purchase of Real Property by Collier County; Checklist for Purchases and Donations; Chapter 73 – Eminent Domain; Chapter 74 – Proceedings Supplemental to Eminent Domain; Chapter 125 – County Government; and Chapter 127 – Right of Eminent Domain for Counties. The audit team reviewed the 2015, 2016, and 2017 Comprehensive Annual Financial Reports (CAFRs) to determine whether any of the reports identified any noncompliance. Although instances of noncompliance were identified in the 2015 and 2016 CAFRs, the noncompliance were not related to our audit objectives. Additionally, the 2017 CAFR indicates that management took corrective action on all findings and did not identify any new instances of noncompliance. Further, the County has a process to provide reasonable assurance that it complies with applicable laws and regulations. The compliance process is described below and applies to both programs: Revenue sources that are restricted for specific purpose are set up in separate funds at the highest level, then individual projects are further segregated with unique project numbers within that fund. All requests to expend funds go through a multi- level review process by various trained and knowledgeable staff to ensure proper 11.D.2 Packet Pg. 697 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-34 budget has been appropriated and only applicable uses of restricted funds are authorized before work begins. The County’s centralized OMB Grants Compliance Office (GCO) oversees the administration of all local, state and federal grants. The applicable division (either Transportation Engineering or Facilities Management) and GCO review grant agreements and ensure that there is an understanding of the pre- and post-award requirements of the grant. The County maintains a separate series of grant funds using a Grants Management Module within its financial system (SAP). Additionally, a unique project number is created for each grant agreement. Prior to expending grant funds, procurement actions receive a final review from GCO at the points of solicitation, contract and requisition. The applicable division is responsible for reviewing the requisitions to ensure that it meets all applicable grant requirements before any budgets are appropriated or any funds are expended. In addition, grant agreements require two Board approvals: one to apply for the grant, one to accept and appropriate the grant funding. Invoices go through the same approval process as outlined above, however, draw packages are prepared by the division fiscal staff, reviewed by division management, and finally approved for submittal by the GCO. Contracts are generally created using the template from the Procurement Services Division and, when applicable, the American Institute of Architects payment application is required when Design firms are required to submit invoices for specific projects. In addition to the Division Director’s review, Procurement also prepares the contract for legal review by the County Attorney’s Office before being brought before the Board for final approval (when applicable and in accordance with the Procurement Ordinance). Once a contract has been approved, all purchase requisitions go through a multi-level review process before work is authorized and funds are expended. As invoices for projects are submitted by vendors/contractors, they go through project management and fiscal support staff, at a minimum, before being reviewed by the Clerk of Courts Finance Department and payment is remitted. As it relates to the proposed surtax, to ensure that uses of the surtax comply with applicate state laws, rules, and regulations the County Infrastructure Surtax Ordinance requires the creation of the seven-member Surtax Citizen Oversight Committee to provide for citizen review of expenditure of surtax proceeds should the surtax be approved by the voters. The Surtax Citizen Oversight Committee will have a regular review schedule. Additionally, expenditures that will be funded by the surtax will go through a multi-level review process and continue to follow the current procedures to ensure that all expenditures are allowable under applicable laws, rules, and regulations. Audit procedures disclosed that the programs have review processes and internal controls in- place to provide reasonable assurance that the programs comply with applicable federal, state, and local laws, rules, and regulations; grant agreements; and local policies. MGT concluded: 11.D.2 Packet Pg. 698 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 3: OBSERVATIONS, FINDINGS, AND RECOMMENDATIONS Performance Audit of Collier County | September 4, 2018 | Final Report Page | 3-35 The Transportation Engineering and Facilities Management programs have processes to assess their compliance with applicable federal, state, and local laws, rules, and regulations; grant agreements; and local policies. The internal controls evaluated by MGT are reasonable to ensure compliance with applicable with federal, state, and local laws, rules, and regulations; contracts; grant agreements; and local policies and procedures. Management has taken reasonable and timely actions to ensure that planned uses of the surtax comply with applicable state laws, rules, and regulations. 11.D.2 Packet Pg. 699 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) Performance Audit of Collier County | September 4, 2018 | Final Report Page | 4-1 O BJECTIVES, S COPE, AND M ETHODOLOGY The scope of this audit focused on the program areas related to construction, repair or maintenance of roads, bridges, signals, sidewalks, parks, as well as evacuation shelters, governmental, mental health, and emergency services facilities; and the acquisition of land and construction support for workforce housing and career and technical training, veterans’ nursing home(s), and expanded mental health facilities. The scope period covered the operations of the program areas from the period July 2015 through May 2018. The audit objectives were: To assess the economy, efficiency, or effectiveness of the program, including the reliability, validity, and relevance of performance and cost measures used to monitor program performance and cost. To determine whether the organizational structure promotes the achievement of the program’s goals and objectives. To determine whether alternative methods of providing services and products are evaluated by program administrators and identify opportunities for alternative service delivery methods. To determine whether the program goals and objectives are clearly stated, measurable, achievable within budget, and consistent with the County's strategic plan. To assess the accuracy and adequacy of public documents, reports, and requests prepared by the County. To determine whether the program operations comply with applicable laws, rules and regulations, and policies and whether program administrators have taken reasonable and timely actions to assess if planned uses of the surtax comply with applicable state laws, rules, and regulations. In conducting the audit, the audit team: Interviewed County personnel and performed researched to gain an understanding of the entity and the transportation and facilities management programs. Held fraud discussions with members of the management team. Interviewed County personnel, reviewed policies and procedures, and created flowcharts to identify and evaluate significant internal controls relevant to the audit objectives and determine whether these controls provide reasonable assurance that program goals and objectives will be met. 11.D.2 Packet Pg. 700 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 4: OBJECTIVES, SCOPE, AND METHODOLOGY Performance Audit of Collier County | September 4, 2018 | Final Report Page | 4-2 Reviewed findings, recommendations, and audit results from internal and external reports issued between the period June 1, 2015, through May 31, 2018, to determine whether management has taken reasonable and timely actions to address any deficiencies in program performance and/or cost identified in any relevant internal or external report. Selected a sample of eight (8) transportation and 20 facilities-related projects and reviewed project information stored in the County’s records to: ─ Determine whether projects are periodically evaluated using performance and cost data adequate to assess performance and cost. ─ Determine whether reports/data used by management on a regular basis is adequate to monitor project performance and cost. ─ Evaluate project performance and cost based on reasonable measures. ─ Evaluate whether the projects were completed on-time, within budget, and at a reasonable cost. ─ Determine whether management formally evaluated existing in-house services and activities to assess the feasibility of alternative methods of providing services, such as outside contracting and privatization, and the reasonableness of their conclusions. ─ Determine whether management assessed any contracted and/or privatized series to verity effectiveness and cost savings achieved and the reasonableness of their conclusions. ─ Identify possible opportunities for alternative service delivery methods that have the potential to reduce program costs without significantly affecting the quality of series. Selected a sample of two (2) land acquisitions and reviewed project information stored in the County’s records to: ─ These land purchases followed internal policies and procedures based on the amounts of the purchases. ─ The two (2) purchases were approved by the Board of County Commissioners (BCC). Reviewed policies and procedures to determine whether the County has established written policies and procedures to take maximum advantage of competitive procurement, volume discounts, and special pricing agreements. Evaluated the organizational structure and design to assess whether it has clearly defined units, minimizes overlapping functions and excessive administrative layers and has lines of authority that minimize administrative costs. 11.D.2 Packet Pg. 701 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) CHAPTER 4: OBJECTIVES, SCOPE, AND METHODOLOGY Performance Audit of Collier County | September 4, 2018 | Final Report Page | 4-3 Assessed the reasonableness of current staffing levels given the nature of the services provided and program workload. Reviewed program goals and objectives and determined whether they are clearly stated and consistent with the County’s strategic plan. Assessed whether the program has financial and non-financial information systems that provide useful, timely, and accurate information to the public. Reviewed the adequacy of public document and reports prepared by the County related to the program. Reviewed the information posted on the County’s website to determine whether the public has access to program performance and cost information that is readily available and easy to locate. Reviewed processes in place to ensure the accuracy and completeness of any program performance and cost information provided to the public. Interviewed County personnel to determine whether the program has procedures in place that ensure that reasonable and timely actions are taken to correct any erroneous and/or incomplete program information included in public documents, reports, and other materials prepared by the County and these procedures provide for adequate public notice of such corrections. Reviewed processes to determine whether the program has a process in place to assess its compliance with applicable federal, state, and local laws, and regulations; contracts; grant agreements; and local policies. Interviewed County personnel and created flowcharts to identify and review internal controls in place to determine whether these controls are reasonable to ensure compliance with applicable federal, state, and local laws, rules, and regulations; contracts; grant agreements; and local policies and procedures. Determined whether management has taken reasonable and timely actions to address any noncompliance with applicable federal, state, and local laws, rules, and regulations; contracts; grant agreements; and local policies and procedures identified by internal or external audits. Interviewed County personnel to determine whether management has taken reasonable and timely actions to ensure that planned uses of the surtax comply with applicable state laws, rules, and regulations. 11.D.2 Packet Pg. 702 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) Performance Audit of Collier County | September 4, 2018 | Final Report Page | i APPENDIX A COLLIER COUNTY MANAGEMENT RESPONSE LETTER 11.D.2 Packet Pg. 703 Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) 11.D.2Packet Pg. 704Attachment: OPPAGA_CollierCo_PerfAudit (7495 : Sales Tax Delivery Plan) Office of Economic and Demographic Research 2018 Local Government Financial Information Handbook 179 Local Government Infrastructure Surtax Section 212.055(2), Florida Statutes Summary: The Local Government Infrastructure Surtax may be levied at the rate of 0.5 or 1 percent pursuant to an ordinance enacted by a majority vote of the county’s governing body and approved by voters in a countywide referendum. Generally, the proceeds must be expended to finance, plan, and construct infrastructure; acquire land for public recreation, conservation, or protection of natural resources; or finance the closure of local government-owned solid waste landfills that have been closed or are required to be closed by order of the Department of Environmental Protection (DEP). Additional spending authority exists for select counties. During the 2018-19 local fiscal year, the 25 counties levying this surtax will realize an estimated $1.58 billion in revenue. The 20 eligible counties not currently levying this surtax at the maximum rate will allow an estimated $2.15 billion to go unrealized. General Law Amendments: Chapter 2018-118, L.O.F., (CS/HB 7087) amends the definition of infrastructure to clarify that public facilities also includes facilities that are necessary to carry out governmental purposes, including, but not limited to, fire stations, general governmental office buildings, and animal shelters. Additionally, the legislation amends the definition of infrastructure to include instructional technology used solely in a school district’s classrooms. Instructional technology is defined as an interactive device that assists a teacher in instructing a class or group of students. The hardware and software necessary to operate the interactive device and support systems in which an interactive device may mount are also included as authorized expenditures. These changes became effective on July 1, 2018. Authorization to Levy: Local governments may levy this surtax at a rate of 0.5 or 1 percent pursuant to an ordinance enacted by a majority of the members of the county’s governing body and approved by the voters in a countywide referendum. In lieu of action by the county’s governing body, municipalities representing a majority of the county’s population may initiate the surtax through the adoption of uniform resolutions calling for a countywide referendum on the issue. If the proposal to levy the surtax is approved by a majority of the electors, the levy takes effect. Additionally, the surtax may not be levied beyond the time established in the ordinance if the surtax was levied pursuant to a referendum held before July 1, 1993. If the pre-July 1, 1993 ordinance did not limit the period of the levy, the surtax may not be levied for more than 15 years. There is no state-mandated limit on the length of levy for those surtax ordinances enacted after July 1, 1993. The levy may only be extended by voter approval in a countywide referendum. This surtax is one of several surtaxes subject to a combined rate limitation. A county cannot levy this surtax and the Small County Surtax, Indigent Care and Trauma Center Surtax, and County Public Hospital Surtax in excess of a combined rate of 1 percent. Counties Eligible to Levy: All counties are eligible to levy the surtax. Distribution of Proceeds: The surtax proceeds are distributed to the county and its respective municipalities according to one of the following procedures. 11.D.3 Packet Pg. 705 Attachment: 2018 EDR Finance Handbook (Pages 179-183) (7495 : Sales Tax Delivery Plan) Office of Economic and Demographic Research 180 2018 Local Government Financial Information Handbook 1. An interlocal agreement approved by county’s governing body and the governing bodies of the municipalities representing a majority of the county’s municipal population. This agreement may include a school district with the consent of all governing bodies previously mentioned. 2. If there is no interlocal agreement, then the distribution will be based on the Local Government Half- cent Sales Tax formulas provided in s. 218.62, F.S. Authorized Uses of Proceeds: The surtax proceeds and any accrued interest are expended by the school district, within the county and municipalities within the county, or, in the case of a negotiated joint county agreement, within another county, for any of the following purposes. 1. To finance, plan, and construct infrastructure. 2. To acquire any interest in land for public recreation, conservation, or protection of natural resources or to prevent or satisfy private property rights claims resulting from limitations imposed by the designation of an area of critical state concern. 3. To provide loans, grants, or rebates to residential or commercial property owners who make energy efficiency improvements to their residential or commercial property, if a local government ordinance authorizing such use is approved by referendum. 4. To finance the closure of county or municipal-owned solid waste landfills that have been closed or are required to be closed by order of the DEP. Any use of the proceeds or interest for purposes of landfill closures before July 1, 1993, is ratified. The term energy efficiency improvement means any energy conservation and efficiency improvement that reduces consumption through conservation or a more efficient use of electricity, natural gas, propane, or other forms of energy on the property, including, but not limited to, air sealing; installation of insulation; installation of energy-efficient heating, cooling, or ventilation systems; installation of solar panels; building modifications to increase the use of daylight or shade; replacement of windows; installation of energy controls or energy recovery systems; installation of electric vehicle charging equipment; installation of systems for natural gas fuel as defined in s. 206.9951, F.S; and installation of efficient lighting equipment. The surtax proceeds and any interest may not be used to fund the operational expenses of infrastructure, except that a county that has a population of fewer than 75,000 that is required to close a landfill may use the proceeds or interest for long-term maintenance costs associated with landfill closure. Counties, as defined in s. 125.011, F.S., (i.e., Miami-Dade County) and charter counties may use the proceeds or interest to retire or service indebtedness incurred for bonds issued before July 1, 1987, for infrastructure purposes, and for bonds subsequently issued to refund such bonds. Any use of the proceeds or interest for purposes of retiring or servicing indebtedness incurred for refunding bonds before July 1, 1999, is ratified. As it relates to the authorized uses of the surtax proceeds and any accrued interest, the term infrastructure has the following meanings. 1. Any fixed capital expenditure or fixed capital outlay associated with the construction, reconstruction, or improvement of public facilities that have a life expectancy of 5 or more years, any related land acquisition, land improvement, design, and engineering costs, and all other professional and related costs required to bring the public facilities into service. For this purpose, the term public facilities 11.D.3 Packet Pg. 706 Attachment: 2018 EDR Finance Handbook (Pages 179-183) (7495 : Sales Tax Delivery Plan) Office of Economic and Demographic Research 2018 Local Government Financial Information Handbook 181 means facilities as defined in ss. 163.3164(39),1 163.3221(13),2 or 189.012(5),3 F.S., and includes facilities that are necessary to carry out governmental purposes, including, but not limited to, fire stations, general governmental office buildings, and animal shelters, regardless of whether the facilities are owned by the local taxing authority or another governmental entity. 2. A fire department vehicle, emergency medical services vehicle, sheriff’s office vehicle, police department vehicle, or any other vehicle, and the equipment necessary to outfit the vehicle for its official use or equipment that has a life expectancy of at least 5 years. 3. Any expenditure for the construction, lease, maintenance, or provision of utilities or security for those court facilities as defined in s. 29.008, F.S. 4. Any fixed capital expenditure or fixed capital outlay associated with the improvement of private facilities that have a life expectancy of 5 or more years and that the owner agrees to make available for use on a temporary basis as needed by a local government as a public emergency shelter or staging area for emergency response equipment during an emergency officially declared by the state or by the local government under s. 252.38, F.S. These private facility improvements are limited to those necessary to comply with current standards for public emergency evacuation shelters. The private facility’s owner must enter into a written contract with the local government providing the improvement funding to make the private facility available to the public for purposes of emergency shelter at no cost to the local government for a minimum of 10 years after the completion of the improvement with the provision that the obligation will transfer to any subsequent owner until the end of the minimum period. 5. Any land-acquisition expenditure for a residential housing project in which at least 30 percent of the units are affordable to individuals or families whose total annual household income does not exceed 120 percent of the area median income adjusted for household size, if the land is owned by a local government or by a special district that enters into a written agreement with the local government to provide such housing. The local government or special district may enter into a ground lease with a public or private person or entity for nominal or other consideration for the construction of the residential housing project on land acquired pursuant to this provision. 6. Instructional technology used solely in a school district’s classrooms. Pursuant to this provision, the term instructional technology means an interactive device that assists a teacher in instructing a class or a group of students and includes the necessary hardware and software to operate the interactive device. The term also includes support systems in which an interactive device may mount and is not required to be affixed to the facilities. Any local government infrastructure surtax imposed or extended after July 1, 1998, may allocate up to 15 percent of the surtax proceeds for deposit within a county trust fund created for the purpose of funding economic development projects having a general public purpose of improving local economies, including the funding of operational costs and incentives related to economic development. The referendum ballot statement must indicate the intention to make the allocation. School districts, counties, and municipalities may 1. Section 163.3164(39), F.S., defines the term public facilities as major capital improvements, including transportation, sanitary sewer, solid waste, drainage, potable water, educational, parks and recreational facilities. 2. Section 163.3221(13), F.S., which defines the term public facilities as major capital improvements, including, but not limited to, transportation, sanitary sewer, solid waste, drainage, potable water, educational, parks and recreational, and health systems and facilities. 3. Section 189.012(5), F.S., which defines the term public facilities as major capital improvements, including, but not limited to, transportation facilities, sanitary sewer facilities, solid waste facilities, water management and control facilities, potable water facilities, alternative water systems, educational facilities, parks and recreational facilities, health systems and facilities, and, except for spoil disposal by those ports listed in s. 311.09(1), F.S., spoil disposal sites for maintenance dredging in waters of the state. 11.D.3 Packet Pg. 707 Attachment: 2018 EDR Finance Handbook (Pages 179-183) (7495 : Sales Tax Delivery Plan) Office of Economic and Demographic Research 182 2018 Local Government Financial Information Handbook pledge the surtax proceeds for the purpose of servicing new bonded indebtedness. Local governments may use the services of the Division of Bond Finance of the State Board of Administration to issue bonds, and counties and municipalities may join together for the issuance of bonds. A county with a total population of 50,000 or less on April 1, 1992, or any county designated as an area of critical state concern that imposed the surtax before July 1, 1992, may use the proceeds and accrued interest of the surtax for any public purpose if the county satisfies all of the following criteria. 1. The debt service obligations for any year are met. 2. The county’s comprehensive plan has been determined to be in compliance with part II of ch. 163, F.S. 3. The county has adopted an amendment to the surtax ordinance pursuant to the procedure provided in s. 125.66, F.S., authorizing additional uses of the proceeds and accrued interest. Those counties designated as an area of critical state concern that qualify to use the surtax for any public purpose may use only up to 10 percent of the surtax proceeds for any public purpose other than for authorized infrastructure purposes. A county that was designated as an area of critical state concern for at least 20 consecutive years prior to removal of the designation, and that qualified to use the surtax for any public purpose at the time of the designation’s removal, may continue to use up to 10 percent of the surtax proceeds for any public purpose other than for infrastructure purposes for 20 years following the designation’s removal. After the 20 year period expires, a county may continue to use up to 10 percent of the surtax proceeds for any public purpose other than for infrastructure if the county adopts an ordinance providing for such continued use of the surtax proceeds. Likewise, a municipality located within such a county may not use the proceeds and accrued interest for any purpose other than an authorized infrastructure purpose unless the municipality’s comprehensive plan has been determined to be in compliance with part II of ch. 163, F.S., and the municipality has adopted an amendment to its surtax ordinance or resolution pursuant to the procedure provided in s. 166.041, F.S., authorizing additional uses of the proceeds and accrued interest. Such municipality may expend the proceeds and accrued interest for any public purpose authorized in the amendment. Despite any other use restrictions to the contrary, a county, having a population greater than 75,000 in which the taxable value of real property is less than 60 percent of the just value of real property for ad valorem tax purposes for the tax year in which the referendum is placed before voters, and the municipalities within such a county may use the surtax proceeds and accrued interest for operation and maintenance of parks and recreation programs and facilities established with the proceeds throughout the duration of the levy or while accrued interest earnings are available for such use, whichever period is longer. Attorney General Opinions: Florida’s Attorney General has issued the following legal opinions relevant to this revenue source. Opinion # Subject 2016-02 Infrastructure surtax, emergency generators 2012-19 Infrastructure surtax, beach erosion projects/studies 2009-28 Counties, use of infrastructure surtax monies 2007-51 Municipalities, use of infrastructure surtax monies 2003-17 Infrastructure surtax use to purchase computer system 11.D.3 Packet Pg. 708 Attachment: 2018 EDR Finance Handbook (Pages 179-183) (7495 : Sales Tax Delivery Plan) Office of Economic and Demographic Research 2018 Local Government Financial Information Handbook 183 2001-45 Local government infrastructure surtax, health care 2000-06 Expenditure of infrastructure surtax revenues 99-24 Capital improvements to property leased by county 95-73 Counties, infrastructure surtax used to fund engineers 95-71 Tourist development tax / infrastructure surtax 94-79 Uses of local government infrastructure surtax 94-46 Vehicles purchased with proceeds of sales surtax 93-92 Local government infrastructure surtax, purchase of vehicle 92-81 Discretionary local option infrastructure sales surtax 92-08 Local government infrastructure surtax proceeds 90-96 Infrastructure surtax proceeds, payment of debt 88-59 Use of discretionary surtax for construction The full texts of these opinions are available via a searchable on-line database.4 Local government officials seeking more clarification should review the opinions in their entirety. The reader should keep the date of the opinion in mind when reviewing its relevance to current law or any interpretations that have been articulated in Florida case law. 4. http://myfloridalegal.com/ago.nsf/Opinions 11.D.3 Packet Pg. 709 Attachment: 2018 EDR Finance Handbook (Pages 179-183) (7495 : Sales Tax Delivery Plan) 750 800 850 900 950 1000 1050 1100 1150 Turner Building Cost Index Quarter 3rd Quarter 2018 2nd Quarter 2018 1st Quarter 2018 4th Quarter 2017 Index 1105 1089 1071 1058 % 1.47 1.68 1.23 1.34 Year 2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007 2006 2005 Average Index 1038 989 943 902 864 830 812 799 832 908 854 793 717 % 5.0 4.7 4.5 4.4 4.1 2.1 1.6 -4.0 -8.4 6.3 7.7 10.6 9.5 The Turner Building Cost Index is determined by the following factors considered on a nationwide basis: labor rates and productivity, material prices and the competitive condition of the marketplace. 2018 Third Quarter Forecast “Pricing for key building materials remains volatile and skilled labor shortages continue to drive construction costs, heightened by several mega projects observed throughout the country.” The Tata Innovation Center at Cornell TechNew York, New York 2014 2015 ©2018 Turner Construction Company turnerconstruction.com/cost-index 2016 Attilio Rivetti Vice President 2017 2018 750 800 850 900 950 1000 1050 1100 1150 11.D.4 Packet Pg. 710 Attachment: Turner Building Cost Index 2018 Qrtr3 (7495 : Sales Tax Delivery Plan) 11.D.5 Packet Pg. 711 Attachment: 7 year tenative Project Delivery Chart (7495 : Sales Tax Delivery Plan) ONE-CENT SALES SURTAX Next steps 11.D.6 Packet Pg. 712 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty •Sales Tax Collection begins January 1, 2019 •Department of Revenue Drafting mailing to registered business owners prior to January •Revenue anticipated in March •OMB developing funding schedule and accounting structure with Clerk of Courts •Establish Citizen Oversight Committee •7 members •1 from each Commission District •2 At-Large •Vacancies advertised starting November 7 •40 applications received 2 FIRST QUARTER CALENDAR 2019 ACTIVITIES 11.D.6 Packet Pg. 713 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty ORGANIZATIONAL MANAGEMENT & OVERSIGHT STRUCTURE •Oversight Committee •Meets Quarterly •County Manager’s Office •Quarterly review with OMB and Project Leads •Communication externally via website updated quarterly •Caps-Track quarterly •Project teams •Establish stakeholder group meetings •Mission, Goals, Milestones 3 Board of County Commissioners County Manager’s Office Office of Budget and Management Citizen Oversight CommitteeCommunication Project Leads Project Manager PMP Project Leads Project Manager PMP Project Leads Project Manager PMP Transportation Projects Facilities Projects Community Priority Projects Directly to BCC Liaison Delivery Team Approach 11.D.6 Packet Pg. 714 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty EXAMPLE REPORT TO CITIZEN OVERSIGHT COMMITTEE •Provide project purpose and location •Provide budget/project information (Revenues and Expenses) •Design •Construction •CEI •Committee would review expenditure for compliance with criteria •Ballot Language •F.S. 212.055(2) •Definition of Infrastructure •Provide project updates “Caps-Track” 4 11.D.6 Packet Pg. 715 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery PROJECT INFORMATION REPORT »To provide Emergency Medical Services to the citizens of Collier County and to continue our partnership with Greater Naples Fire by providing a shared space for joint operations. The Lords Way -Hacienda Lakes 11.D.6 Packet Pg. 716 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery PROJECT PLANS, BUDGET, & DETAILS »DESIGN: $160,200 »CONSTRUCTION: $2,188,846 »CEI: $59,904 Original budget developed in 2016. Construction estimate for 2019 project requires redeveloped budget. Pending budget update. 11.D.6 Packet Pg. 717 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery SCHEDULE MILESTONES ACTIVITY START FINISH 2018 2019 2020 2021 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 SDP / DESIGN Jun-18 Dec-18 --------- PERMITTING Aug-18 Apr-19 ------------ BIDDING / PROCURMENT Jan-19 Jul-19 --------- CONTRACT AWARD (BCC)Jul-19 Jul-19 --- CONSTRUCTION Jul-19 Jul-20 --------------- 11.D.6 Packet Pg. 718 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty 7 YEAR TENTATIVE PROJECT DELIVERY CHART 8 11.D.6 Packet Pg. 719 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty PROJECT PRIORITIZATION •First •Health •Safety •Welfare •Second •Condition of asset •Cost of ongoing maintenance •Third •Market conditions •Availability of funds 9 11.D.6 Packet Pg. 720 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty CONSTRUCTION TIMING •Corresponding construction values currently increasing as shown on the most recent Turner Building Cost index •Projects managed in a manner that takes advantage of the construction market •Preparing projects for construction •Grouping projects •Timing projects 10 11.D.6 Packet Pg. 721 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty BUDGET CONSIDERATIONS •Separate fund and capital accounting structure •Use of gap financing depending upon •Project timing •Sales tax revenue stream •Sales Tax simply reduces the level of capital financing required to fund priority infrastructure improvement 11 11.D.6 Packet Pg. 722 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty BUDGET CONSIDERATIONS •Capital financing outside the sales tax umbrella include •Stormwater infrastructure •Northeast Public Utilities expansion •Road network improvements •O&M obligations continue •Stormwater •Parks •Landscaping •General government 12 11.D.6 Packet Pg. 723 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery CollierCounty RECOMMENDATION •To review and approve the County’s delivery plan for the execution of the projects approved by the Board and a majority of the electorate to be funded from the proceeds of the Sales Tax with oversight from The Committee….. Questions/Direction ? 13 11.D.6 Packet Pg. 724 Attachment: One-Cent Sales Surtax next steps (presentation) (7495 : Sales Tax Delivery