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HomeMy WebLinkAboutDocumentation_Regular_Tab 8A_7/24/1997 • VILLAGE OF TEQUESTA Mr A Post Office Box 3273 • 35- Tequesta Drive Or Tequesta. Florida 33-169-0273 • (561) V 3-62(k) :Agrw Fax: (561) 575-6203 OM cp VILLAGE OF TEQUESTA REDEVELOPMENT COMMITTEE MEETING MINUTES DUNE 2, 1997 • • I . CALL TO ORDER AND ROLL CALL The Tequesta Redevelopment Committee held a regularly scheduled meeting at the Village Hall, 357 Tequesta Drive, . Tequesta, Florida, on Monday, June 2, 1997. The meeting was called to order at 8 : 32 A.M. by Chairman Carl Hansen. A roll call was taken by Betty Laur, the Recording Secretary. In attendance were: Chairman Carl C. Hansen, and Co-Chairs Joseph Capretta and Ron T. Mackail . Also in attendance were: Village Manager Thomas G. Bradford, and Finance Director Bill Kascavelis. Village Clerk Joann Manganiello arrived at 8 : 36 A.M. II. APPROVAL OF AGENDA Co-Chair Mackail made a motion to accept the agenda- as submitted. Co-Chair Capretta seconded the motion. The vote on the motion was: Carl C. Hansen - for • Joseph N. Capretta - for Ron T. Mackail - for The motion was therefore passed and adopted and the agenda was accepted as submitted. REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2, 1997 PAGE 2 III. COMMUNICATIONS FROM CITIZENS There were no communications from citizens. IV. DISCUSSION OF DIRECTOR OF FINANCE' S REPORT ON FINANCING PROPOSED PUBLIC FACILITIES Village Manager Bradford commented that at the last meeting of the Committee, staff had been requested to determine the total cost of new facilities. Village Manager Bradford reported that the public safety facilities would cost $2 .5 million; Village Hall would cost $2 .2 million, and to remodel the Recreation Center in its entirety the cost would be $382, 000; or a total for everything of $5.1 million. The Committee had requested revenue projections from new construction in the community which would help finance the facilities, which Finance Director Kascavelis reported to be $220, 980. The Committee had also requested financing options, including information from Barnett Bank regarding a letter of credit. Clark Bennett reported that Barnett Bank would furnish a $1, 000, 000 letter of credit at a rate of 69.77% of prime, which would change as prime changes. Interest would be paid only on the amount drawn down. A one-time facility fee of $1, 000 would be charged, and the attorney' s fee would be $2, 000. Principal would be repaid at term. Mr. Bennett explained that permanent financing for the project would be expanded to include the bank letter of credit. Barnett Bank had asked that the credit represent a general obligation of the Village, to which Mr. Bennett had objected because that would require a referendum if the borrowing extended over a year. Mr. Bennett had explained that the Village would pledge assets other than ad valorem' revenue so that the bank would not require this loan to be considered a general obligation. In order for the bank to give the preferential rate quoted which was one-half percent lower than the Village could get anywhere else, the Village could issue no more than $10 million in a given year. This was based on Treasury Department rules which allowed the bank to receive tax-exempt status on the income from the loan and to deduct the cost of carry. By keeping total borrowing under $5 REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2, 1997 PAGE 3 million, the Village could keep any arbitrage earnings. The construction fund could be invested and no rebate on earnings would be required. Mr. Bennett commented that he expected the Village would use the letter of credit for engineering and preliminary work. Mr. Bennett reviewed annual debt service schedules of Public Safety facilities at 6% and at 7% . At 6%, total principal and interest at the highest point would be $213, 710. The highest principal and interest payment in any given year would take place in the year 2010. At 7% the maximum would occur in 2025 and would be $240, 827 . Mr. Clark explained that all issuance costs of a bonding issue had been included. One of the assumptions Mr. Clark had made was that the Village would insure the bonding, which would raise the rating to AAA, making it more appealing to bond buyers. Mr. Clark also assumed that the insurance company would provide a debt service reserve surety, negating the necessity of a debt service reserve, normally 10% of the par amount of the bonds, or an additional $240, 000 in one of the scenarios presented upon which interest must be paid. Mr. Clark had also placed the construction fund at interest over at 18-month period, which would reduce the amount needed to fund the project. In the 6% scenario, the debt service fell within revenue projections. Debt service would be paid from utility service tax plus ad valorem property taxes. Mr. Bennett commented that these scenarios were for constructing the Public Safety facilities only. In response to a question from Chair Hansen regarding starting a Village Hall project before the Public Safety construction was finished, Mr. Bennett responded that overlapping projects would add additional fixed costs because each project would require a new funding. Mr. Bennett explained that he had done scenarios giving a 6% and a 7% figure for doing both the Public Safety and Administrative complex at one time; and also if Public Safety, Administration, and the Recreation facility were done at one time. All of the scenarios assumed that interest rates stayed constant and that the Village issued the bonds 10-1-98, so that the first principal payment would be due in 1999. For the Public Safety and Administration Complex, maximum debt service in any given year at 6% would REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2, 1997 PAGE 4 be approximately $345, 000; at 7% it would be $385, 000 . For the Public Safety facility, Administration Complex, and Recreation facility, maximum debt service in any given year at 6% would be approximately $371, 000; at 7% it would be over $400, 000 . For the Public Safety facilities and the Recreation facilities, maximum debt service in any given year at 6% would be approximately $241, 000; at 7% it would be $271, 000 . These scenarios were not overlapping, but assumed the projects to be done at one time. During ensuing discussion of income figures from new construction for the Village which had appeared in the newspaper, Village Manager Bradford reported those figures had included Sterling House and Cliveden, and not Tequesta Oaks. Co-Chair Mackail recommended that a projection be prepared of the cost to do all the projects at one time in order to show residents that it would be cheaper to do the projects all at once. Co-Chair Mackail estimated that using a figure of $110, 000 for annual general operations and doing all three projects at once, the Village would be $270, 000 short without increasing ad valorem taxes. Village Manager Bradford also reminded the Committee that the utility tax could be increased another percent, which would provide $50, 000-$60, 000 annually. Finance Director Kascavelis explained that would require approximately . 7 mills, or $70 increase for each homeowner in the Village. Discussion ensued. Village Manager Bradford commented that by constructing a new Village Hall that $25, 000 annual rent would be saved and the Water Department would pay for a portion of the Village Hall . Co-Chair Capretta expressed concern that the public would accept only the necessity for a Public Safety facility but would not see a need for the Village Hall . Co-Chair Mackail expressed the opinion that with the recent charette there was an opportunity for the Village Hall to be located downtown. Mr. Bennett explained that if a delay was anticipated, a Treasury Department rule that requires 85% of money borrowed to be spent within 3 years could come into play. Co-Chair Mackail commented that with issuance of bonds in 1998, there would be 15 months in which to make a decision, and there was a way to get people committed within a reasonable period of time, and if no commitment was made then the Village would go to a backup plan. Co-Chair Capretta commented that getting a commitment REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2, 1997 PAGE 5 • was difficult, and commented that if the Village Hall was to be built downtown in connection with another objective established by the Village, then he believed the financing should be separated so that a decision could be made now to build a Public Safety building only. To keep the $5 million plan alive and allow time to see how realistic a Village Hall located downtown would be, Mr. Bennett explained that the Village would need to consult Bond counsel who would not allow the Village to place themselves into a position to have a problem with the Treasury, and that agreements should be in place by May of 1998 . Village Manager Bradford commented that placing the Village Hall downtown would mean that $1-$2 million would need to be added for land acquisition. Village Clerk Manganiello commented that the design for a Village Hall would take 11 months . Co-Chair Capretta commented that if the Village wished to participate in the downtown development, the option to place Village Hall downtown must be left open. Village Manager Bradford commented that he was leaning towards forgetting downtown' as a Village Hall location, since he could not see it ever happening and explained that the logistics of holding meetings in the Recreation Center would be a nightmare for administration, and recreational programs would be affected. Chair Hansen expressed concern that the code violations in the present building needed to be complied with, to which Village Manager Bradford responded that as long as progress was being made there was no problem with ADA. Chair Hansen commented that with the increasing tax base, 50% to 75% of the cost would be taken care of, so that there were good reasons to consider doing all projects at once. Chair Hansen suggested taking a close look at the proposed floor plan for Village Hall to see if any cost cuts could be made without reducing needed space. Village Manager Bradford suggested that another option would be to get a letter of credit set up and to go forward with Public Safety design, while looking into a downtown location and fine-tuning the Village Hall plan, so that hopefully before a year a commitment would be made and then bids for both Village Hall and Public Safety could be done at once time. Mr. Clark suggested that if other players were put on notice that there was a time limit for making a commitment that they might negotiate. Discussion ensued regarding a time limit for the downtown location, after which if no commitment was • REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2, 1997 PAGE 6 received the Village would build on their present property; and a meeting place during construction. Tom Little commented that the North County Ambulance building could be appropriate for Village meetings . Co-Chair Mackail responded that he had discussed the future of that building with Hart Ransdale and understood that Jupiter hospital' s long-term plan for that building was to convert it to some type of medical facility. Co-Chair Mackail explained that . he expected to hear shortly from Mr. Ransdale regarding their committee' s decision regarding possible Village use of that building. Co-Chair Mackail made a motion to approve that the Village Manager direct staff to proceed with obtaining a Letter of Credit in the amount of $1 million. Co-Chair Capretta seconded the motion. The vote on the motion was: Carl C. Hansen - for Joseph 'N. Capretta - for Ron T. Mackail - for The motion was therefore passed and adopted. Co-Chair Capretta suggested that the entire plan be discussed at the June 12, 1997 Village Council meeting to see whether other Councilmembers supported leaving open the option of locating a new Village Hall downtown, and to allow the public to participate in discussion. Chair Hansen agreed. Chair Hansen requested an explanation about the proposal to pass a resolution to reimburse original expenditures. Village Manager Bradford explained there was an IRS rule that up-front costs incurred. prior to issuance of bonds, such as Gee & Jenson' s architectural design contract, could be included in the bond amount if a Resolution were passed for that purpose,' and suggested that the Committee make a motion of recommendation that be done at the next Village Council meeting. Chair Hansen called for discussion regarding repairs for the Recreation building. Chair Hansen commented that the Committeemembers had looked at the Recreation building and REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2, 1997 PAGE 7 that Mr. Preston had indicated that all of the needed work should be done. Village Manager Bradford commented that he had understood the Committee wished to only do minimal repairs to make the facility operational, which would be lights, addition of an office, and repair of the bathrooms . Village Clerk Manganiello reviewed the repairs discussed at the last meeting which totaled approximately $54, 000 without proceeding with items necessary for Village Council meetings . Ms. Manganiello reminded the Committee that a request had been made that those repairs begin in August, 1997; and the proposal would be presented for approval at the June 12 Village Council meeting. In response to Chair Hansen, Ms. Manganiello explained that the construction figures were a few months old but were conservative, and it would depend on the bids as to how much the figures would change. The only variable which had not been included was hazardous waste materials, for which the analysis would be $3, 000 to $4, 000 . Removal costs would be the variable if any hazardous materials were found; $80, 000 had been estimated. V. REVIEW OF DRAFT PUBLIC FACILITIES SPEECH Village Manager Bradford commented that since nothing had been finalized except to proceed with design of •the Public Safety facility, he did not know whether the speech was needed at this time. Co-Chair Mackail recommended the speech be held in abeyance and updated as progress was made. Village Clerk Manganiello commented that the information • could be placed in the newsletter. Chair Hansen made comments on items in the speech: that Phase 1 had been moving into the United Bank Building and Phase 2 was the new garage; that Public Safety facilities was not a "wait and see" matter; and that the bonds to be issued to finance construction were 30-year revenue bonds. Co-Chair Capretta commented that the Mayor should use this speech when asked to speak to the Chamber of Commerce, and concentration should be on why the new facilities were needed, and the public made aware of the need, and asked to participate in design of the facade, etc. Co-Chair Capretta explained that he visualized the "dog and pony show" to include facts of REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2, 1997 PAGE 8 conditions the firemen were living in, . the Police Department, etc. Co-Chair Capretta stressed the importance of everyone having the same facts when answering questions from the public and to convey the urgency of doing something. Although it had been known for more than ten years that new facilities were needed, affordability had prevented proceeding with new, facilities in the past, and now new developments were in place to increase the tax base. Village Manager Bradford agreed that it had been known for the past ten years that new facilities were needed, that this building had been used for 32 years, and commented that for the last few years the Capretta Plan had been to stimulate development, and that by this time next year the tax base should reach the goal of $400, 000, 000. Co-Chair Capretta commented that if new facilities were not built that the present building would have to be renovated at a cost of approximately $1 million and there would be no more space. Co-Chair Capretta commented that the public was not aware of the inadequacies of the present facilities. Chair Hansen commented that since the numbers did not look bad, it was not unreasonable to implement the entire plan, and he believed that by talking with people over the next 9 to 12 months they would be convinced also. Co-Chair Capretta commented that he was beginning to discuss the inadequacies of the present facilities at social gatherings to learn what types of questions would be asked, and to let the Village Manager know those questions so that he could place the questions and answers in the speech. Chair Hansen commented that the numbers in the speech were very good, and suggested some portions of the speech which were lengthy be condensed. Co-Chair Mackail made a motion to pass a Resolution for reimbursement of expenses at the June 12, 1997 Village Council meeting. Co-Chair Capretta seconded the motion. The vote on the motion was: Carl C. Hansen - for Joseph N. Capretta - for Ron T. Mackail - for • The motion was therefore passed and adopted. • REDEVELOPMENT COMMITTEE MEETING MINUTES JUNE 2 , 1997 PAGE 9 VIII. ANY OTHER MATTERS There were no other matters to come before the Committee. VIII . ADJOURNMENT Co-Chair Mackail made a motion to adjourn the meeting. Co- Chair Capretta seconded the motion. The vote on the motion was: Carl C. Hansen - for Joseph N. Capretta - for Ron T. Mackail - for The motion was therefore passed and adopted and the meeting was adjourned at 10:05 A.M. Respectfully submitted, Betty Laur Recording Secretary ATTEST: Joann Manganiello Village Clerk DATE APPROVED: