Finance_Committee Minutes 10/20//2023Finance Committee Meeting Minutes
October 20, 2023
County Manager’s Front Conference Room
2:00 PM
Board Members in Attendance: Present:
•Ed Finn, Deputy County Manager
•Christopher Johnson, Director, Corporate Financial and Management Services
•Joseph Belone, Director PUD Operations Support
•Derek Johnssen, Clerk of Courts Finance Director
•Ellen Sheffy, Division Director, Fiscal & Grant Services TMS
Other Attendees: Present:
•Kenneth Kovensky, Executive Director Corporate Business Operations
•Jeff Klatzkow, County Attorney
•Sally Askar, Assistant County Attorney
•Katrina Lin, Manager, Financial Operations, PUD
•Michael Smykowski, Clerks Finance
Via Phone: Steve Miller, Nabors, Giblin & Nickerson, Sergio Masvidal - PFM
1. Call to Order: Ed Finn called the meeting to order at 2:04 PM / Roll Call
2. Approval of Agenda Meeting Notice dated October 10, 2023
Approved by Ed Finn seconded by Chris Johnson, third Derek Johnson. Agenda
approved unanimously.
3. Approval of the Meeting Minutes from August 7, 2023.
Derek Johnssen recommended an adjustment to the minutes:
•Page 2 under Public Utilities, bullet point #12, “Himself” is referencing Ed Finn.
Correction noted by Chris Johnson and will be adjusted.
Derek made a motion to approve the minutes with said adjustment, and motion was seconded,
and meeting minutes were unanimously approved.
4. Discussion of Agenda Item #4 “Budget Environment and other anticipated
borrowing.”
Ed Finn began the discussion:
1.Met with the Board on September 21st where they rolled back General Fund 111
Millage Rates as well as Conservation Collier Millage Rates. This is the first time they
haven’t gone with a millage neutral approach in 14 years.
2.At the same time, they rolled back to the rollback rate and backfilled the budget with
one-time money from Conservation Collier.
3.The Budget itself remains unchanged. The number of reserves available to
Conservation Collier has changed and now our annual budget is funded with one-time
money.
4.We will be running exercises to see what a 10% reduction will do for us for information
purposes.
5.If this rollback continues, we will need to make some adjustments. At the same time,
we are looking at changing how we are going to go into the budget process with the
Board, which will start 2-3 months earlier than usual, most likely in January when we
will discuss with the Board budget policy before developing it.
6.At the same time, we will update the Board on our Strategic Plan and an advisement of
how our AUIR looks like, so we can inform them about what is necessary in the budget
policy and to get their direction, without huge adjustments at the end of the process,
which is our objective.
7.Rest assured; we will be much more progressive in our outlook. Afterall, that is what
our elected officials want.
Chris Johnson:
1.Want to touch base on how we will be looking at our zero-based budget moving
forward by identifying our mandated items, essential programs, and discretionary
programs.
2. Moving forward, we will be reviewing budgeting software to see how we will be
putting this together.
3.It’s a good idea to start identifying what items are state, local, and federally mandated,
as well as what we have now that is essential vs. what is discretionary to our budgets.
4.Hoping to utilize our software to get the results out of the reports and develop
something to bring to the Board to portray how we are building this from a zero-base.
Derek: What motivating factors are out there like the AAA rating, how much is that a motivating
factor for the board.
Ed: One of our foundations in our budget approach is maintaining the best possible rating by being
conservative with revenue projections by ensuring we have sufficient cash balances, ensuring we
have sufficient reserves and doing so in a conservative manner, to ensure growth and improvement
each year.
Jeff: My expectation is that there will be a rollback again next year. Had discussions with one
Commissioner about if the Board wants to cut the budget like this, they will need to get into
infrastructure sales tax. Taxes can be cut, but there needs to be a discussion about how to improve
our current infrastructure to maintain what we have.
Derek: One of the largest unrestricted sources we avail ourselves of is the half-cent sales tax, and
that will have to take the load.
Jeff: If we are going to go back to the Infrastructure Sales Tax, that will require a referendum
which is 2024 and that last time we did this we already had started that, so the longer we put this
off, the less chance we have of doing it.
Joe: If they are looking at things that are essential and mandatory and mandated by regulatory
agencies, and we throw out aquatics, I don’t think that fits into any of those categories. We don’t
have to have swimming pools.
Jeff: We must have swimming pools for the public.
Joe: We are talking about maintenance and associated things like that. We have beautiful parks
and libraries, if we start cutting back on those services it will all fall apart fast.
Jeff: We can use Surtax for what we really need to get done, which will free up money for other
things, because money is fungible, and last time we got ½ Billion dollars out of it which would
finance a lot of infrastructure.
Ed. Jeff’s point on the Infrastructure Surtax absolutely hits home and I think everybody in this
room in the absence of a completely new approach to funding, Infrastructure with ad valorem taxes
is something we must have. When we meet with the Board in January, we owe them a discussion
on revenue source diversification that might include franchise, station revenue, source money and
a lot more revenue.
Chris: Going into next year, if the transfers happen, given conservative expense estimates, we
should be okay for 2025.
Ed: Joe, what is our capital program for the next 5-10 years?
Joe: Five years about 1 Billion according to the AUIR, which includes the expansions.
Ed: What is the timetable for next week for the rate study?
Joe: Meeting with the CMO on October 31st. Draft is loaded in MT as a draft. If they accept the
rate study and allow me to advertise the resolution, I will bring it to the Board in December, and
the new rates will be effective January 1, 2024.
Jeff: What if the Board says no?
Joe: We would need to cut back on our capital program.
Derek: Do we anticipate borrowing? We need to get some detail on Transportation on the
Vanderbilt Extension project.
Chris: Last time I looked we were sitting at about $100 Million remaining on the PO. So, about
2/3. Any idea on the timing? This was to be a two to three-year project.
Ellen: Yes, and we were going to pull commercial paper at the very end.
Chris: That is the last thing we are touching on that, so as we roll through, I don’t think it will be
that clear.
Stormwater:
Ellen: Working on a number now. We are at $35 Million, but we are working on bringing that
number down. They are mostly partnership projects, so we are reaching out to our partners to make
sure they are set to move forward. However, we just lost another PM, so we may not have the staff
to manage it. They are working on the numbers for this year.
Ed: So, where are we with borrowed money related to Stormwater?
Ellen: It is totally encumbered and this $35 Million is additional this year.
Ed: The task is to identify a few things. One is contract and two is cash flow. And those contracts
require budget backing them up. We are going to need something on the revenue side to pump up
the budget, so we have that capacity. So, you’re out of budget capacity for projects you anticipate
needing to sign contract for this year?
Ellen: That is correct.
Ed: So, we talked a little bit about the financing requirements in the existing commercial
commitments we have relative to Vanderbilt Beach, which will require some draw.
Ellen: Correct
Ed: Joe was thinking in the absence of some major glitches with your revenue desires with the
Headworks project.
Joe: We have the predicted pay schedule, month by month from now until the end of the project
and we know what we're going to have to pay them at certain dates. We should have enough budget
and cash on hand to do that. If anything gets delayed at all, we will be fine.
Ed: So just to recap, with Stormwater there may be a need to support budget with some mechanism
so that they don’t have any glitches with their commitments and program moving forward.
Williams Property
Ed: Looking at the Williams property in Immokalee, which is a $22 million acquisition.
Jeff: Will we bond it?
Ed: Will probably need a commercial paper loan. We hope for a combination of funding sources
with Conservation Collier Funds, potentially Roads, Stormwater.
Another one coming will be a combination, preserve potential future road, stormwater, parks, and
impact fees would be in that mix. There's a little chunk that the fire wants and there's the existing
affordable housing money coming out of the surtax. So, it's going to be a relatively involved
financing package.
Riviera
Ed: There is a $5.8 million dollar settlement that if all goes well would be covered by an assessment
district in the long run. Jeff has a lot of confidence that's going to go through.
Ed: Anything else on budget or financial needs?
Jeff: Are we going to do by-laws?
Mike: This was not a meeting required by the Sunshine law and issues were raised, and some
procedures were developed. The quorum is 5
Ed: Will discuss with the CMO to get their opinion.
Jeff: We can discuss it at the next Finance Meeting. Just want to get the by-laws Board approved.
Ed: Given the kind of landscape we're all moving into, it probably would be best to have this
tightened up because we're going to be coming with some substantial financing over the next two
to three years.
5. Other Business: None
6.Public Comment: None
7.Meeting Adjourned at 2:51 PM