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BCC Minutes 11/01/2006 E (Pine Ridge-Naples Production Park Debt Service Fund) November 1, 2006 TRANSCRIPT OF THE EMERGENCY MEETING OF THE BOARD OF COUNTY COMMISSIONERS Naples, Florida November 1, 2006 LET IT BE REMEMBERED, that the Board of County Commissioners, in and for the County of Collier, and also acting as the Board of Zoning Appeals and as the governing board( s) of such special district as has been created according to law and having conducted business herein, met on this date at 1 :00 p.m. in EMERGENCY SESSION in Building "F" of the Government Complex, East Naples, Florida, with the following members present: CHAIRMAN: Frank Halas Jim Coletta Fred W. Coyle Donna Fiala (by telephone) Tom Henning ALSO PRESENT: Jim Mudd, County Manager David Weigel, County Attorney Michael Smykowski, Director of Business Management & Budget Page 1 COLLIER COUNTY BOARD OF COUNTY COMMISSIONERS ~ Board of County Commissioners SPECIAL MEETING AGENDA November 1, 2006 1 :00 p.m. Frank Halas, Chairman, District 2 Jim Coletta, Vice-Chairman, District 5 Tom Henning, Commissioner, District 3 Donna Fiala, Commissioner, District 1 Fred W. Coyle, Commissioner, District 4 NOTICE: ALL PERSONS WISHING TO SPEAK ON ANY AGENDA ITEM MUST REGISTER PRIOR TO SPEAKING. SPEAKERS MUST REGISTER WITH THE COUNTY MANAGER PRIOR TO THE PRESENTATION OF THE AGENDA ITEM TO BE ADDRESSED. COLLIER COUNTY ORDINANCE NO. 2004-05, AS AMENDED REQUIRES THAT ALL LOBBYISTS SHALL, BEFORE ENGAGING IN ANY LOBBYING ACTIVITIES (INCLUDING, BUT NOT LIMITED TO, ADDRESSING THE BOARD OF COUNTY COMMISSIONERS), REGISTER WITH THE CLERK TO THE BOARD AT THE BOARD MINUTES AND RECORDS DEPARTMENT. REQUESTS TO ADDRESS THE BOARD ON SUBJECTS WHICH ARE NOT ON THIS AGENDA MUST BE SUBMITTED IN WRITING WITH EXPLANATION TO THE COUNTY MANAGER AT LEAST 13 DAYS PRIOR TO THE DATE OF THE MEETING AND WILL BE HEARD UNDER "PUBLIC PETITIONS." ANY PERSON WHO DECIDES TO APPEAL A DECISION OF THIS BOARD WILL NEED A RECORD OF THE PROCEEDINGS PERTAINING THERETO, AND THEREFORE MAY NEED TO ENSURE THAT A VERBATIM RECORD Page 1 November 1, 2006 OF THE PROCEEDINGS IS MADE, WHICH RECORD INCLUDES THE TESTIMONY AND EVIDENCE UPON WHICH THE APPEAL IS TO BE BASED. ALL REGISTERED PUBLIC SPEAKERS WILL RECEIVE UP TO FIVE (5) MINUTES UNLESS THE TIME IS ADJUSTED BY THE CHAIRMAN. IF YOU ARE A PERSON WITH A DISABILITY WHO NEEDS ANY ACCOMMODATION IN ORDER TO PARTICIPATE IN THIS PROCEEDING, YOU ARE ENTITLED, AT NO COST TO YOU, TO THE PROVISION OF CERTAIN ASSISTANCE. PLEASE CONTACT THE COLLIER COUNTY FACILITIES MANAGEMENT DEPARTMENT LOCATED AT 3301 EAST TAMIAMI TRAIL, NAPLES, FLORIDA, 34112, (239) 774-8380; ASSISTED LISTENING DEVICES FOR THE HEARING IMP AIRED ARE AVAILABLE IN THE COUNTY COMMISSIONERS' OFFICE. 1. PLEDGE OF ALLEGIANCE 2. THE BOARD TO CONSIDER RECOMMENDATION TO APPROVE A BUDGET AMENDMENT FROM RESERVES WITHIN THE PINE RIDGEINAPLES PRODUCTION PARK DEBT SERVICE FUND TO APPROPRIATE THE ANNUAL PRINCIPAL AND INTEREST PAYMENTS AND ARBITRAGE CALCULATION FEES ON OUTSTANDING SPECIAL ASSESSMENT REVENUE BONDS. 3. ADJOURN INQUIRIES CONCERNING CHANGES TO THE BOARD'S AGENDA SHOULD BE MADE TO THE COUNTY MANAGER'S OFFICE AT 774-8383. Page 2 November 1, 2006 November 1, 2006 MR. MUDD: Ladies and gentlemen, if you would please take your seats. Mr. Chairman, Commissioners, you have a hot mike. CHAIRMAN HALAS: Thank you very much, County Manager Mudd. This is a special meeting of the Collier County Board of Commissioners. And I believe it was a note -- it was published -- a notification was published in advance. And, at that, if everyone would make sure that their cell phones are silenced or pagers. At this time we'll all rise for the pledge. (The pledge of allegiance was recited.) CHAIRMAN HALAS: Okay. County Manager Mudd. MR. MUDD: Commissioners, this special meeting is called to -- it's to rectify a particular issue that was an oversight in the budget. And this item that we want to discuss is an executive summary, which I believe all Commissioners received a copy of this morning. It is a recommendation to approve a budget -- COMMISSIONER FIALA: Hi. MS. FIALA: Thank you. COMMISSIONER COLETTA: Hello. MR. MUDD: Go ahead, David. MR. WEIGEL: Thank you, Jim, Mr. Chairman. Ms. Fiala is now on line on the telephone. COMMISSIONER FIALA: Yes. Can you hear me okay? MR. WEIGEL: We hear you fine. COMMISSIONER FIALA: I better get to a different place. MR. WEIGEL: Mr. Chairman, I'm just indicating while she's -- COMMISSIONER FIALA: Hello. Hold on. I'm going to a Page 2 November 1, 2006 different area -- MR. WEIGEL: Thank you. COMMISSIONER FIALA: -- where it is a little quieter. Can you hear me now? MR. MUDD: Commissioner Fiala, we can hear you. COMMISSIONER FIALA: Okay. Great. Thank you. MR. MUDD: The County Attorney right now is going through the procedures to get the Board to identify the fact that you're in attendance by phone. COMMISSIONER FIALA: Okay. Thank you. MR. MUDD: Mr. Weigel. MR. WEIGEL: Thank you, Jim. Mr. Chairman and Commissioners, it is appropriate and essential that the Board of County Commissioners make a determination that Mrs. Fiala's participation by telephone is necessary due to extraordinary circumstances. And if you would move and vote that accordingly, then she may participate just as you are here yourselves. CHAIRMAN HALAS: So move. COMMISSIONER COLETTA: Second. CHAIRMAN HALAS: Okay. There is a motion on the floor for approval to join this conversation. All those in favor signify by saying aye. (A chorus of ayes.) CHAIRMAN HALAS: Oppose by like sign. (No response.) CHAIRMAN HALAS: Motion carries. We can proceed on. COMMISSIONER FIALA: Thank you. Page 3 November 1, 2006 MR. MUDD: Commissioners, this is to basically deal with an action that was a recommendation to approve a budget amendment from reserves within the Pine Ridge/Naples production park debt service fund to appropriate the annual principal and interest payments and arbitrage calculation fees on outstanding special assessment revenue bonds. And this particular item Mr. Michael Smykowski will present. But this is basically an issue whereby this payment was not put on the budget for '07. It was an oversight, as far as staff is concerned. And we need those particular items to be put into the budget. The money does reside in this particular MSTU fund in order to pay that. So it doesn't have to deal with the general fund or anything else like that. Mr. Smykowski. MR. SMYKOWSKI: Thank you, Mr. Mudd. CHAIRMAN HALAS: I have a question. Mike, from what I read on this thing, this was supposed to be paid off in '06. Was that correct? MR. SMYKOWSKI: Yes, sir. CHAIRMAN HALAS: And what happened that it wasn't? Is that part of your explanation? MR. SMYKOWSKI: Yes. That's part of my presentation. With that, Michael Smykowski, OMD Director, for the record. These special assessment bonds, Series 1993, were issued to finance roadway and drainage improvements within the two respective industrial parks; the Pine Ridge Industrial Park and the Naples Production Park. The revenues supporting this bond issue are special assessments levied solely against benefiting properties within those Page 4 November 1,2006 two production parks. The budget forecast in fiscal year '06 assumed that we would be paying off in its entirety all outstanding principal and interest associated with this bond issue. As such, there was not a budget appropriated in fiscal year '07 for the principal and interest payments. Principal and interest payments are due November 1 st, which is today. It was not paid off. There are some extenuating circumstances relative to that issue. We're working with bond counsel to address those, such as alternative uses of surplus funds. There is actually $4.4 million within -- within this fund for fiscal year '07 above and beyond that which was forecast to payoff the entire outstanding amount of debt service in fiscal year '06. So there is a surplus of funds left over so the issue is: Do we refund that money? Do we make additional improvements? Weare working with bond counsel. Refund the money? And there is also an issue -- there are still outstanding special assessments yet to be collected. But, obviously, we're in a position where -- because of unspent bond proceeds, we actually have enough cash already in the fund. But there is also an issue -- many of the business owners within those parks chose to prepay their assessments in full. Obviously you have people paying over time that are still -- the residual funds that are outstanding, in terms of special assessments. So the question becomes: If you just stopped collecting the remaining special assessments, you have, in essence, rewarded those who chose to pay over time to the detriment of those who chose to pay early. So we are going to work through all those logistics with Page 5 November 1, 2006 bond counsel to address that. We would be bringing that back to the Board pending a determination as to the most appropriate use and what -- what limitations, if any, there are within the bond covenants themselves relative to the disposition of those surplus funds. So as a consequence, because of those issues, the bonds were not paid off in their entirety. There is more than adequate budget to make the debt service payments. That is not in question. Like I said, there is approximately $4.4 million in fiscal year '07 available. We need about 1,172,500 to make the principal and interest payments, as well as any arbitrage calculation fees during the course of this fiscal year. So we're solely seeking so that the Clerk can make the debt service payment today to put that principal and interest payment budget in place and then the fund would be wired. CHAIRMAN HALAS: So we need a motion to move 1.75 -- $1,720,500; is that correct? MR. MUDD: $1,172,500. CHAIRMAN HALAS: One million 172. Okay. Do we have a motion? COMMISSIONER HENNING: Motion-- MR. SMYKOWSKI: And that will cover the interest payments. CHAIRMAN HALAS: Commissioner Coyle, I'm sorry. COMMISSIONER COYLE: I'm not sure we got to the real issue here. But we knew that we hadn't paid off the bond -- this bond. And we knew it before the budgeting period started. We failed to approve the budget for the paying of this principal and interest payment on the bond, right? Page 6 November 1,2006 And we didn't -- since we didn't approve the budget, the Clerk can't authorize the payment. Isn't that the bottom line? MR. SMYKOWSKI: Yes. COMMISSIONER COYLE: So we have an oversight? MR. SMYKOWSKI: Yes, sir. COMMISSIONER COYLE: So we are here to correct an oversight? MR. SMYKOWSKI: Yes, sir. And obviously we want to protect the County's bond rating and make the payment in accordance with the bond covenants. COMMISSIONER COYLE: So do we have a motion already? CHAIRMAN HALAS: We have a motion by Commissioner Henning. COMMISSIONER COYLE: Then you have a second from me. COMMISSIONER HENNING: Let me state the motion. To approve aI, 172,500 budget amendment to establish the budget appropriation for principal, interest and arbitrage calculation fees. And also to authorize staff to payoff the outstanding principal and interest on the bond issued in its entirety and approve the associated budget amendments thereafter. COMMISSIONER COYLE: Okay. I'll second that. CHAIRMAN HALAS: Okay. Any further discussion? Do you have something to say, Dwight? MR. BROCK: Yes, Commissioner. CHAIRMAN HALAS: Okay. MR. BROCK: My name is Dwight Brock. I'm the Clerk of Court. Page 7 November 1, 2006 We have been working -- Crystal and Mike have been working for a day or two trying to resolve. This was a -- nothing more than a scrivener's error in the process because we were anticipating resolving the issue relating to the bonds and dealing with them as Mike has just defined. And because that did not occur, it was an oversight in the process dealing with the principal and interest payment in the budget. And it's simply the money is there. It always has been there. It has just been a reserve line item as opposed to an appropriation line item. And in order for us to make the payment, it has to be moved into the principal and interest and arbitrage line item to comply with Florida law. That's the sum and substance of what we are attempting to do so we can lawfully make the payment. CHAIRMAN HALAS: Okay. I have one other question. In this -- the motion that you made, Commissioner, was in no way to -- for the people that are paying on time to circumvent their obligation; is that correct? COMMISSIONER HENNING: No, sir. I believe it's up to our staff to come back and make recommendations on how we deal with the issue of getting the money back or making future improvements. CHAIRMAN HALAS: Very good. MR. SMYKOWSKI: Yes, sir. And we'll be working with bond counsel toward that end and would bring that back. And it would require a Board policy decision before we would proceed in whatever is deemed appropriate. CHAIRMAN HALAS: Is there any further discussion on this matter? Page 8 November 1,2006 If not, I'll call the question. There is a motion on the floor by Commissioner Henning and a second by Commissioner Coyle to take care of the outstanding assets in regards to this payment of interest and fees. All those in favor signify by saying aye. (Chorus of ayes.) CHAIRMAN HALAS: Oppose by like sign. (No response.) CHAIRMAN HALAS: Motion carries. MR. SMYKOWSKI: Thank you. CHAIRMAN HALAS: Anything else we need to bring up? MR. MUDD: Mr. Chairman, that's all the business we have today. Thank you very much for coming in at this short notice. CHAIRMAN HALAS: Do my fellow Commissioners have anything to offer? Ifnot, we are adjourned. ******* There being no further business for the good of the County, the meeting was adjourned by order of the Chair at 4:09 p.m. Page 9 November 1, 2006 BOARD OF COUNTY COMMISSIONERS BOARD OF ZONING APPEALS/EX OFFICIO GOVERNING BOARD(S) OF SPECIAL DISTRICTS UNDER ITS CONTROL ~~~4? ./ FRANK HALAS, Chairman ATTEST:.. 't r~. DWIGHT E.B CK, CLERK ~... {l1k At tes.t ' as. to eM 1........ , I tgAttwt 011, These minutes ap~ by the Board on 1/12.- ~ 12~, as presented ~ or as corrected TRANSCRIPT PREPARED ON BEHALF OF GREGORY COURT REPORTING SERVICES, INC., BY KELLEY BLECHA Page 10