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HomeMy WebLinkAbout2010 05 20 Oak Forest Wall and Beautification DAC Special Approved MinutesCITY OF WINTER SPRINGS, FLORIDA MINUTES OAK FOREST WALL AND BEAUTIFICATION DISTRICT ADVISORY COMMITTEE SPECIAL MEETING MAY 20, 2010 CALL TO ORDER The Special Meeting of Thursday, May 20, 2010 of the Oak Forest Wall and Beautification District Advisory Committee was called to Order by Chairperson Judy Converso at 7:04 p.m., in the Commission Chambers of the Municipal Building (City Hall, 1126 East State Road 434, and Winter Springs, Florida 32708). Roll Call: Chairperson Judy Converso, present Vice Chairman Terry Patten, present Committee Member Brian Oliver, present Committee Member Raquel Santana, present Advisory Committee Member Brian Oliver led the Pledge of Allegiance. PUBLIC INPUT No one spoke. REGULAR AGENDA REGULAR 600. Community Development Department — Urban Beautification Services Division Discuss Refinancing Of The Debt Service. Mr. Steven Richart, Urban Beautification Services Division Manager, Community Development Department introduced the Finance and Administrative Services Director, Shawn Boyle and the City Controller, Donna Borrelli to the Advisory Committee and stated, "They are here to support us tonight." Mr. Richart presented this Agenda Item and stated, "As I have told you before, the Debt Service is related to building the Wall and all the landscape enhancements that we have. As you remember years ago, we finished spending what we were going to spend and then we used the surplus to apply towards the Debt and we paid that down some. Today we are faced with our revenue note that is coming due in July." CITY OF WINTER SPRINGS, FLORIDA MINUTES OAK FOREST WALL AND BEAUTIFICATION DISTRICT ADVISORY COMMITTEE SPECIAL MEETING - MAY 20, 2010 PAGE 2 OF 5 Then, Mr. Richart noted, "That is going to leave us with three hundred seventeen thousand two hundred sixty-two dollars and thirty-three cents ($317,262.33) that will have to be repaid." Continuing, Mr. Richart further explained, "We are looking at different options to finance that money and get that taken care of. We come tonight with two (2) options here; we have a Commercial Note which is an unsecured Note and essentially it is similar to a Mortgage but because it is public property — with a Mortgage they would say that your house is the security for this note, we do not have that. The Commercial Note will carry a little bit higher interest than you may have on other types of financing. Other than that it is similar." Mr. Richart added, "It is really a small amount of money that we need to finance; that is one (1) option." With further discussion, Mr. Richart informed the Committee of Option 2 and noted, "It is internal financing from the City's Cash Reserves. The City would be financing the Debt for you if we went that direction. It would have — less interest compared to the other option. The Citizens see a benefit of the interest and you, as an Advisory Board and the District; you see the benefit of the lower interest rate as opposed to the other." Mr. Richart added, "It has about the same closing costs; we will have the Attorney's Fees and the Recording costs — will be involved. These are our two (2) options. I have some back-up material here (to the Agenda Item), attachments `A', `B', and `C'." As the Committee and Mr. Richart began to review Attachment `A', Mr. Richart commented, "You will see that we have this amortized for seven (7) years; twenty-eight (28) payments in seven (7) years at three and an eighth [percent] (3 iia %). Now keep in mind with Option 1 or 2, the City Commission has to approve it. We cannot make the final decision here tonight, but what I would like to do is have you look at this and say, `We like `Option 1' or `Option 2' better' and then we can say, `The Advisory Board supports this Option', but they may not make the decision that you want and they might make the decision that you want; it is up to them." Further discussion ensued regarding the details of the Options and the Attachments. Mr. Richart noted that there would be quarterly payments made and commented, "The amounts would be about twelve thousand six hundred fifty-nine dollars ($12,659.00) and change, and at the end of the seven (7) years, we are done." Discussion continued concerning the current Assessments and the Revenues. Advisory Committee Member Oliver asked, "With the economy, how does that do if we have a lot of foreclosures?" Mr. Richart replied, "We have talked about that and we are on track this year." Mr. Richart referred to Attachment `B' to show the Committee what we have in the proposed Budget and clarified the information on Attachment `B'. CITY OF WINTER SPRINGS, FLORIDA MINUTES OAK FOREST WALL AND BEAUTIFICATION DISTRICT ADVISORY COMMITTEE SPECIAL MEETING - MAY 20, 2010 PAGE 3 OF 5 Vice Chairman Terry Patten inquired, "Going back to the Revised Fiscal Year 9[2009] and 10 [2010], could you refresh my memory as to what the twenty five hundred dollar ($2,500.00) consulting fee was?" Vice Chairman Patten continued, "The reason I am asking that because it is not budgeted in the new Budget and I just want to make sure that it was not an oversight." Mr. Richart stated, "That is a good question, can I email you that?" Vice Chairman Patten stated, "Absolutely." Discussion. Mr. Richart remarked, "I will email you tomorrow if that is okay." There were no objections from the Committee. Further discussion proceeded on the Options, the Budgeting and the Amortizations schedule. Mr. Richart commented, "We did have Chris Traber (Esquire, Nabors, Giblin & Nickerson) our Legal Counsel for the District gave us an email (Attachment `C') and he gave his opinion. And we have been talking with the City Attorney and we are awaiting his final opinion on that." Continuing, Mr. Richart confirmed, "What we are looking from you tonight is far you to consider this; to make a recommendation to the City Commission to support either Option `1' or Option `2' to finance this outstanding debt." Mr. Richart added, "Because this — is July 1 St , we have to do something. When we figure out all the details, I can send you all an email." Discussion. Committee Member Oliver asked, "Is this a fixed rate? It is not a variable rate?" Mr. Richart replied, "It is a fixed rate on this loan. If the City does this loan, there will be a conversion clause in it. It will simply mean that if the City finds itself needing this funding; if there is some catastrophe or some short fall — then we would have to go out and do Option `1' — where you would have to go out into the maxketplace and do the loan. We do not think that is going to happen but it could." Further discussion ensued on the Options available and interest rates. Mr. Richart stated that he can send an Amortization Schedule tomorrow. Mr. Boyle, Finance and Administrative Services Director commented, "It is going to be about thirty or forty percent (30-40%) higher, so if you took the interest calculation that you have and you look at the difference between three and one eighth (3 vs) and four point six (4.6), it is probably thirty-eight percent (38%) plus or minus, multiply that by your outstanding interest that you paid on that ..." Vice Chairman Patten stated, "... So roughly about five thousand dollars ($5,000.00) overall." Mr. Boyle remarked, "It is probably more than that." Vice Chairman Patten noted, "I am sorry five thousand [dollars] ($5,000.00)..." CITY OF WINTER SPRINGS, FLORIDA MINUTES OAK FOREST WALL AND BEAUTIFICATION DISTRICT ADVISORY COMMITTEE SPECIAL MEETING - MAY 20, 2010 PAGE 4 OF 5 Mr. Boyle advised, ". .. Per year. Yes, that is what I was coming up with; about thirty thousand dollars ($30,000.00) over the life of the loan." Vice Chairman Patten agreed. There were no objections from the Committee. With further discussion regarding loans and rates, Mr. Boyle added, "The probability that the City would come to you for relief of three hundred thousand dollars ($300,000.00) is minute; likely, if we find ourselves in that type of situation, we would go to other sources first. We have the ability to borrow at a much lower rate that you do. The probability is probably less than twenty percent (20%)." Mr. Boyle continued, "If the economy stays soft you are not facing any interest rate risk." Chairperson Converso read the Recommendation from the Agenda Item `600' prior to the Motion: `Staff recommends that the Oak Forest Wall and Beautification District Advisory Board review all information and make a recommendation to the City Commission as to which option to support for financing of the outstanding debt of three hundred seventeen thousand two hundred sixty-two [dollars] thirty-three [cents] ($317,262.33) (as of July 1, 2010), as related to the Oak Forest Debt Service Fund 192." "I MAKE THE MOTION THAT WE CONSIDER OPTION `2' WHICH WOULD BE THAT WE BORROW THE MONEY FROM THE CITY IN ORDER TO TAKE CARE OF THIS THREE HUNDRED FIFTY FOUR THOUSAND FOUR HUNDRED FIFTY-NINE DOLLAR ($354,459.00) LOAN." CHAIRPERSON CONVERSO ASKED, "DO YOU WANT TO MAKE THAT A CONSIDERATION OR A RECOMMENDATION TO THE CITY COMMISSION?" VICE CHAIRMAN PATTEN STATED, "I AM MAKING A RECOMMENDATION THAT WE VOTE TO MAKE THAT THE RECOMMENDATION TO THE CITY COMMISSIONERS." MOTION BY VICE CHAIRMAN PATTEN. SECONDED BY ADVISORY COMMITTEE MEMBER SANTANA. DISCUSSION. MR. RICHART COMMENTED, "COULD I ASK YOU TO DO ONE SLIGHT TEXT CHANGE TO THAT?" VICE CHAIRMAN PATTEN STATED, "YES." MR. RICHART NOTED, THREE HUNDRED SEVENTEEN THOUSAND TWO HUNDRED SIXTY-TWO [DOLLARS] THIRTY THREE [CENTS] ($317,262.33)." VICE CHAIRMAN PATTEN STATED, "YES, SO POINTED OUT, THE TOTAL PRINCIPAL WAS THREE SEVENTEEN TWO HUNDRED SIXTY-TWO [DOLLARS] AND THIRTY-THREE CENTS ($317,262.33)." MR. RICHART ADDED, "AND ANY RELATED CLOSING COSTS." VICE CHAIRMAN PATTEN AFFIRMED, "AND ANY RELATED CLOSING COSTS." CITY OF WINTER SPRINGS, FLORIDA MINUTES OAK FOREST WALL AND BEAUTIFICATION DISTRICT ADVISORY COMMITTEE SPECIAL MEETING — MAY 20, 2010 PAGE 5 OF 5 VOTE: CHAIRPERSON CONVERSO: AYE COMMITTEE MEMBER SANTANA: AYE VICE CHAIRMAN PATTEN: AYE COMMITTEE MEMBER OLIVER: AYE MOTION CARRIED. Discussion ensued about the Maintenance of the Landscaping. ADJOURNMENT Chairperson Converso adjourned the Special Meeting at 7:42 p.m. RESPECTFULLY SUBMITTED: I ' CAROL A. LAL ATHIN ASSISTANT TO THE CITY CLERK NOTE: These Minutes were approved at the January 13, 2011 Oak Forest Wall and Beautification District Advisory Committee Regulaz Meeting.