Agenda 10/12/2010 Item #10A
Agenda Item No. 10A
October 12, 2010
Page 1 of 6
EXECUTIVE SUMMARY
Report on the status of State and local efforts connected with the potential location of a Florida
Institute for Personalized Medicine operated by Jackson laboratory and the proposed development of
a regional biomedical research campus on surrounding acreage
OBJECTIVE: Brief the Board of County Commissioners on the most current developments associated
with the potential location of Jackson Laboratory and the greater regional biomedical research campus.
CONSIDERATIONS: The project know as the Jackson Laboratory Institute for Personalized Medicine has
eVDlved over the past six months with increasing discussion between the Laboratory and the State's
respective economic development agencies - Enterprise Florida and the Office of Trade Tourism and
EconDmic Development (OTTED). The Institute is proposed to be the centerpiece of a larger biomedical
research campus on 700 acres of land located in the Ave Maria Stewardship Receiving Area. Educational
partners exploring joint ventures with the Institute include the University of SDuth Florida, EdisDn State
CD liege and Florida Gulf Coast University. Further interest continues to be discussed amDng the medical
and research community.
State Legislation and Potential State Flow of Funds:
On May 28, 2010, Governor Charlie Crist signed into Law the State's budget which set aside $50,000,000
in year one within the InnDvation Incentive Fund as part of a maximum three year $130,000,000
commitment subject tD annual appropriatiDn. In discussiDns before the Board of County Commissioners,
directiDn is clear that the local funding sources will not be committed ahead of the state flow of dollars.
In fact, the legislation prDvides that __."Iocal matching funds will be adopted by the local government
within 120 days of the grant award frDm OTTED and such local commitment must include at least
$130,000,000 of cash, committed future revenues which OTTED determines to have a value Df
$130,000,000, land or infrastructure, or some combination thereDf equaling $130,000,000".
While the legislatiDn appropriating dollars from the State has been passed, a series of state efforts are
underway which may lead to actual deposit of funds within OTTED's economic development trust fund.
Currently Enterprise Florida is conducting required economic analysis to determine if the Collier County
project meets criteria established within the State's innovation Incentive Program.
UpDn completion ofthe econDmic analysis by Enterprise Florida, the project is forwarded to OTTED for
review and signoff prior to submitting the project to the Legislative Budget Commission (LBC). It is
anticipated that the LBC will consider the project within the next sixty (60) days according to the latest
reports from Enterprise Florida. Once the LBC apprDves the project, a contract will be negotiated with
the Laboratory and then State funds could be released into a trust fund.
"...-
Concern on the local level cDntinues to focus on how the State funds will be disbursed. Will $50,000,000
be available up front fDr use in facility construction or will the state funds be disbursed periodically over
time once operatiDnal perfDrmance benchmarks are satisfied? Answers to these questions have not yet
been received frDm the State, making it difficult to know the specific requirements for the local funding
commitment.
Agenda Item NO.1 OA
October 12. 2010
Page 2 of 6
Local Fundinj! Commitment:
With no guarantee that the State will appropriate the remaining $80,000,000 in years two and three,
and knowing that the local commitment will not step ahead of the State's flow of funds, planning at the
local level to explore potential financing options for construction of a personalized medicine facility has
focused on traditional financing methods and other financing opportunities that may be available as the
details of the project are determined. The following table provides a summary of the staff options
explored to date;
Assumption Financing Option Funding Source Funding County
Requirements Investment
Security
A. State releases full Issue special All legally Bond Counsel has To be
$50,000,000 for obligation revenue available non-ad- advised that negotiated
immediate draw bonds under a va lorem issuance will with the local
compelling local covenant to budget revenues. Will require bond Developer and
match of and appropriate likely require a validation to affected
$50,000,000 within (CB&A) new non-ad- determine a IIvalid parties; could
120 days valorem revenue public purpose". include
source (Le. Process likely to exchange of
franchise fee); extend three (3) land or cash
level annual debt to six (6) months remittances at
service estimated depending upon building
at 5% over 15 legal challenges. permit
years equals
$4.8M. Total No referendum
estimated P&I is required
$72M
General Obligation Ad Valorem Referendum Similar
Bond Revenue; similar required
repayment terms
Agenda Item NO.1 OA
October 12, 2010
Page 3 of 6
Assumption Financing Option Funding Source Funding Cou nty
Requirements Investment
Secu rity
County appropriates Inter-fund loans Separate Similar
$28,000,000 through to be repaid by a financing to repay
inter-fund loans in FY separate the inter,fund
11 and procures financing; other loans would
remaining new non ad require bond
$22,000,000 from valorem revenue validation to
other local sources source or within determine a "valid
the County's public purpose";
existing revenue local source
structure commitment for
remaining funding
undetermined
B. State Funding Procure public- Private Financing County lease Similar
disbursed over time private partnership secured by local payments from
requiring as much as (P3) financing to credit through generai revenues
I
$100,000,000 up construct the facility annual lease ! bolstered by
front from non State payments from franchise fee
sources to construct the County, local
the personalized developer and/
medicine facility or the Laboratory
Local developer Developer County lease Similar
constructs facility Financing payments from
partially secured general revenues
by annual County bolstered by
payments under franchise fee
a facilities
agreement
between the
developer,
county and
laboratory i
The Board of County Commissioners, on September 14, 2010 directed the County Manager to initiate
the bond validation process after it was determined by Bond Counsel that the issuance of debt secured
by non ad valorem revenues would require a "Public Purpose Validation". Pursuing this validation would
provide flexibility in the event the project proceeds and the Board directs County Manager or his
designee to issue bonds in connection with the project.
Should it be determined that the issuance of non ad-valorem speciai revenue debt is appropriate for this
project, a new revenue source will likely be required for debt repayment in iight of continued declining
taxable value and our millage neutral position. Institution of a franchise fee has been discussed and can
be instituted by simple majority vote on the enabling resolution by the Board with the distribution of
Agenda Item No. 10A
October 12, 2010
Page 4 of6
franchise fee proceeds to follow 90 - 120 days hence, These dollars flow directly to the County from the
applicable electric utility,
It is likely based upon current information from the State that the County will not know the availability
nor disbursement schedule of State funds until mid November at the earliest. Enterprise Florida officials
have indicated that their economic analysis is still in process and that their data analysis is only
associated with the Laboratory and not the biomedical cluster contemplated in the WEG report.
Zoning:
Current zoning would accommodate and allow the Jackson Laboratory facility to be constructed on
approximately SO acres within the Ave Maria sRA/DRI in Town Center 2 along Camp Keais Road with no
further review, However, this is not the proposed site. The State Department of Community Affairs has
indicated that Board action is likely required to formalize the transfer of an approved land use from one
location within the sRA to another. Of course Board action would be preceded by a recommendation
from the Planning Commission.
Development of the larger Biomedical Cluster and research campus proposed in the new Town Center
along Oil Well Road will require approval through several processes and can be defined in two phases.
During phase one, the applicant would adjust the mix of approved land uses and attempt to maintain a
neutral regional impact. This phase would include approximateiy 500,000 additional square feet of
ancillary uses that would compliment phase 1. In order to remain regionally insignificant, a
corresponding reduction would take place of other non similar uses. This phase would require a review
by the RPC, DCA, FOOT and the local government through a Notice of Proposed Change (NOPe). The
review would confirm that no substantial deviation has occurred and it is not regionally significant. This
review would also go through a CCPC and BCC public hearing process.
The final zoning phase is more speculative as it would be to complete the entire Biomedical Cluster
which is estimated at 3 million square feet of research, educational and medical uses as well as an
approximate 750,000 square foot teaching hospital. This phase could be accomplished through an
NOPC, Substantial Deviation application or a new sRA village application. This review would also go
through a CCPC and BCC public hearing process.
Agenda Item No. 10A
October 12, 2010
Page 5 of 6
Next Steps:
While uncertainty exists over the final commitment of State dollars, the use ofthose dollars and the
disbursement schedule, continued due diligence on matters of local financial participation, zoning and
securing any County investment in the project is recommended. The Board has directed the County
Manager to proceed with "Public Purpose Bond Validation" and soliciting private equity interest in
project financing. The required resolution to begin the bond validation process will be considered at the
October 12, 2010 BCC meeting. Actions are also underway to identify, qualify and solicit potential
private equity investors with the assistance of the County's Financial Advisor firm.
The County Manager will continue to communicate with the State agencies - Enterprise Florida and
OTTED pending final resolution of the State's funding component. It is important to note that the State
budget appropriation statute authorizing funding for this project states that if all requirements are not
met by March 1, 2011, the State funds provided shall revert to the General Revenue Fund.
LEGAL CONSIDERATIONS:
This is simply a status report. No legal issues are raised. -JAK
RECOMMENDATIONS: It is recommended that the Board accept this status report.
PREPARED BY: Leo E. Ochs, Jr., County Manager and Mark Isackson, Director, Corporate Financial and
Management Services, County Manager's Office
Agenda Item No. 10A
October 12, 2010
Page 6 of 6
COLLIER COUNTY
BOARD OF COUNTY COMMISSIONERS
Item Number:
Item Summary:
10A
Report on the status of State and Local efforts connected with the potential location of a
Florida Institute for Personalized Medicine operated by Jackson Laboratory and the proposed
development of a regional biomedical research campus on surrounding acreage. (Mark
Isackson, Director, Corporate Financial and Management Services, County Manager's
Office)
10/12/20109:00:00 AM
Meeting Date:
Prepared By
Mark Isackson
ManagementfBudget Analyst, Senior
Date
Office of Management &
Budget
Office of Management & Budget
10/6/20108:39:57 AM
Approved By
Leo E. Ochs, Jr.
County Manager
Date
County Managers Office
County Managers Office
10/6/20106:32 PM