HomeMy WebLinkAboutAgenda BOC 032411AGENDA
CITY OF PALM BEACH GARDENS
BUDGET OVERSIGHT COMMITTEE
Thursday March 24 , 201 1 , 8:3 0 AM
CITY COUNCIL CHAMBERS
I. CALL TO ORDER
II. PLEDGE OF ALLEGIANCE
III. ROLL CALL :
Regular Members
L. Marc Cohn Chair
Bernard Pettingill Regular Member
Phillip Woodall Regular Member
Marilyn Lew -Jacobs Regular Member
IV. ADDITIONS, DELETIONS, MODIFICATIONS:
V. APPROVAL OF MINUTES
1. February 24 , 2011
VI. ITEMS BY COUNCIL LIAISON
VII. ITEMS BY STAFF LIAISON
1. Update on status of FY 2012 Budget preparation
VIII. OLD BUS I NESS
1. Discussion of Blue Ribbon Panel Report on Canal System Restoration
and Maintenance
IX. NEW BUSINESS
1. Discussion of vacant Committee seat
X. COMMENTS BY PUBLIC
XI. COMMENTS BY THE BOARD
XII. ADJO U RNMENT
B UDGET O VERSIGHT C OMMITTEE M EETING PAGE
02 ·24 ·11
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CITY OF PALM BEACH GARDENS 1
BUDGET OVERSIGHT COMMITTEE 2
REGULAR MEETING 3
FEBRUARY 24 , 20 1 1 4
5
I. CALL TO ORDER 6
The regular meeting was called to order at 8 :3 8 a.m. by Chair L. Marc Cohn . 7
II. PLEDGE OF ALLEGIANCE 8
III. ROLL CALL 9
PRESENT: Chair L . Marc Cohn , Bernard Petting ill, Phillip A. Woodall , Marilyn Lew -Jacobs . 10
ABSENT: Vice Chair Kenneth Menard . 11
ALSO PRESENT: Vice Mayor, Council Liaison Robert Premuroso; Finance Administrator, 12
Staff Liaison Allan Owens; Deputy Finance Administrator, Alternate Sta ff Liaison Mary 13
Anders on -Pickle . 14
IV. ADDITIONS, DELETIONS, MODIFICATIONS 15
None . 16
V. APPROVAL OF MINUTES 17
A motion was made and seconded for approval of the January 27, 2011 minutes . 18
Motion passed 4 -0. 19
VI. ITEMS BY COUNCIL LIAISON 20
None. 21
VII. ITEMS BY STAFF LIAISON 22
1. F Y 2012 Budget Calendar 23
Staff Pre sentation: Deputy Finance Administrator Mary Anderson -Pickle . 24
Discussion ensued. 25
2. FY 2012 Significant Budget Initiatives 26
Staff Presentation: Finance Administrator Allan Owens . 27
Discussion ensued. 28
VIII. OLD BUSINESS 29
None . 30
IX. NEW BUSINESS 31
None. 32
X. COMMENTS BY THE PUBLIC 33
None. 34
XI. COMMENTS BY THE BOARD 35
Chair Cohn requested the Palm Beach County Budget Fact Sheet be distributed to all Board 36
members . 37
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(The remainder of this page intentionally left blank.) 39
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B UDGET O VERSIGHT C OMMITTEE M EETING PAGE
02 ·24 ·11
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XII. ADJOURNMENT 1
Marilyn Lew -Jacobs made a motion for adjournment. 2
Phillip Woodall seconded. 3
Motion passed , 4 -0. 4
T he meeting adjourned at 9 :22 a .m . The next regular meeting will be held March 24 , 201 1 . 5
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APPROVED : 7
8
9
10 L. Marc Cohn , Chair 11
12
13
14 Kenneth Menard, Vice Chair 15
16
17
18 Bernard Pettingill 19
20
21
22 Phillip A. Woodall 23
24
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26 Marilyn Lew -Jacobs 27
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31
ATTEST : 32
33
34
35
Donna M. Cannon 36
Municipal Services Coordinator 37
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NOTE: These minutes are prepared in compliance with 286.011 F.S. and are not verbatim transcripts of 44
the meeting. A verbatim audio recording is available from the Office of the City Clerk. All referenced 45
attachments on file in the Office of the City Clerk . 46
FISCAL YEAR 2011/2012
BUDGET UPDATE
Budget Oversight Committee Meeting
March 24, 2011
Summary
Estimated reduction in property values:
1.Worst case could be -6%
2.Best case could be -2% to -3%
Projected budget shortfall at -6% with no increase in taxes or
other revenues and no cuts in personnel is about $5.3 million
Projected budget shortfall at -2% with no increase in taxes or
other revenues and no cuts in personnel is about $3.6 million
Significant Budget Issues
Personnel costs
1.Collective Bargaining Agreements
2.Public Safety Pensions
Revenues
1.Maintain millage rate
2.Communication Service Tax
3.Use of Reserves
Questions
THE CITY OF PALM BEACH GARDENS
BLUE RIBBON PANEL
REPORT ON
CANAL SYSTEM RESTORATION AND MAINTENANCE
BLUE RIBBON PANEL
Name
1. Marilyn Lew-Jacobs
2. TerryLewis
3. Joan Altwater
4. Terrie Bates
5. ChuckHaas
6. Linda Monroe 0
7. Sanford Pearl
8. Paul Auerbach
9. Wesley Lauer
1O.Theodore G. Thoburn
11. Louis Satriano
12. Adrian Salee
Address
16 Bermuda Lake Drive
Palm Beach Gardens, FL 33418
5703 High Flyer Road S.
Palm Beach Gardens, FL 33418
91 80 Cypress Hollow Drive
Palm Beach Gardens, FL 33418
11 11 0 Oak Way Circle
Palm Beach Gardens, FL 3341 0
9003 Gardens Glen Circle
Palm Beach Gardens, FL 3341 8
619 Hudson Bay Drive
Palm Beach Gardens, FL 33410
9968 Dahlia Avenue
Palm Beach Gardens, FL 33410
11 21 5 Curry Drive
Palm Beach Gardens, FL 33418
3 Surrey Road
Palm Beach Gardens, FL 3341 8
201 5 LaPorte Drive
Palm Beach Gardens, FL 33410
4703 Lakemont Court
Palm Beach Gardens, FL 33403
378 Kelsey Park Drive
Palm Beach Gardens, FL 33410
Profession
CPA
Attorney
Environmentalist
SFWMD
CPA
Planner
Resident
Attorney
Attorney
Banker
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BLUE RIBBON PANEL @
REPORT ON CANAL SYSTEM RESTORATION AND MAINTENANCE
TABLE OF CONTENTS
TOPIC PAGE NUMBER
Introduction 1
Research and Analysis 2-3
Funding AI ternatives 4-6
Recommendation 7-8
Methodology for Establishing a MSBU for Restoration 9 - 11
How and why the strategy will work 12 - 14
Conclusion 15
EXHIBITS
Exhibit A:
Overview of restoration projects identified in the Stormwater
Management Plan and Neighborhood Maps
Exhibit B:
List and chart of funding sources and special district alternatives for
stormwater capital improvements and maintenance
Exhibit C:
Comparison between MSTU and General Revenue Bond for restoration
Exhibit 0:
Map of areas to receive discounts for existing stormwater systems
BLUE RIBBON PANEL
REPORT ON CANAL SYSTEM RESTORATION AN0 MAINTENANCE
INTROOUCTION
On May 3, 2002, the Blue Ribbon Panel was established by Resolution 80,
2002, at the direction of Mayor Eric Jablin who requested the assistance of
the City Manager to form a committee of residents to address quality of life
issues facing the City, including stormwater drainage. The Panel's charge has
been to examine various options and make recommendations to the City
Council on how best to address and fund such maintenance and improvements
in a fair and equitable manner.
The Panel met on a bi-monthly basis from July to December 2002, focusing
on finding a solution to fund the City's canal restoration and maintenance
programs. There is extensive documentation to support the fact that many
of our canals have minimal water storage capacity available, and minimal
conveyance due to sedimentation. There is a direct correlation between the
ability of the City's stormwater system to effectively store and convey
stormwater, avoidance of water quality and related environmental impacts,
and comprehensive, citywide flood protection for our homes and businesses.
These are quality of life factors that impact all City residents.
The Panel recognized those facts, and searched for the most cost effective
way to fund a program that will fix the current stormwater system
deficiencies in a timely manner, and provide a long-term program to fund
ongoing maintenance. The Panel had technical assistance f rom City staff.
However, the recommendation presented in this report is the direct result
of the Panel's work, and the guidance of several panel members themselves
who have technical, legal and financial expertise in the area of establishing
funding for stormwater system restoration and maintenance.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
1
RESEARCH AND ANALYSIS
Over the years the City's stormwater system has grown less effective. The
original canal design cross sections for much of the system has diminished,
resulting in less stormwater storage and conveyance capacity, and
contributing to flooding which has occurred in areas of the City. While some
restoration activities were planned and implemented to clean the canals to
decrease the frequency of flooding, many pro.iects still need to be
addressed to avoid future floodins in all neishborhoods.
During their analysis, Panel members considered the following information as
the basis for making their recommendation for funding canal restoration and
maintenance:
9 The City has historically provided funding within the Public
Works Department budget to perform canal and swale
maintenance. Current funding levels have been at a total of
approximately $1 million for these maintenance programs each
year.
9 In addition, for Fiscal Years 2002 and 2003 the City included in
the budget $400:000 for canal restoration projects.
9 The City's Stormwater Management Plan was presented to City
Council on April 4, 2002. The Plan defined and prioritized
stormwater system restoration projects. In June 2002, City
Council directed staff to proceed with the first two priority
projects listed in the Plan (Thompson River Canal from
Lighthouse Drive to Holly Drive and 1-95 to Military Trail).
9 The Stormwater Management Plan indicates that approximately
$5 million is needed to restore the City's stormwater system to
maintain a minimum level of service. The Plan identified ten (10)
areas as priority restoration projects.
9 The City has continuously searched for other funding sources
such as Federal and State grants. As an example, the City
received a FEMA grant in the amount of $350,000 to improve
the drainage facilities in Plat 4 (Garden Woods).
Blue Ribbon Panel Report on Canal System Restoration and Maintenance 2
12/26/02
9 The Panel asked the City Engineer what amount of funding
would be needed to completely restore, upgrade and maintain
the City's entire drainage system.
9 An overview along with neighborhood maps showing all of the
projects that were identified by the Stormwater Management
Plan which would restore and upgrade the City's primary canal
system is attached to this report as Exhibit A.
9 For the Panel's analysis, the base case is the combination of
the priority projects as well as additional areas identified
for further investigation in the Stormwater Management
Plan. The base case also includes the recently annexed
areas of Garden Oaks, Sunset Drive and Mary Circle.
> For purposes of this report. the "base case plus" includes
the base case or central part of the City, Units 2 and 19
of Northern Palm Beach County Improvement bistrict. the
Cabana Colony Canal and the RCA Boulevard Drainaqe - Ditch,
as shown on Exhibit A4. The total estimated capital costs
for all of the canal restoration Drojects are $10,793.000.
0
9 The City Engineer advised that approximately one million dollars
in capital improvement projects could be completed in a year.
9 At the.current funding levels, it would take approximately 25
years to completely restore and upgrade the City's primary
canal system as outlined in the Plan and on Exhibit Al.
Throuqh its research, the Panel found that ad valorem taxes as a
revenue source have not provided and likely could not provide the level
of fundinq - necessary to fully address all of the restoration pro-iects in
the Stormwater Manaqement Plan. Given competinq annual budqetary
demands. the challenqe has become how to establish a dedicated source
of fundinq to restore the City's primary drainaqe system. and a
dedicated source of fundinq - for continued maintenance in the areas that
directly benefit from or contribute discharqe to the system. The
dedicated sources of fundinq would be set aside specifically for canal
restoration and maintenance, and for no other budqetary purpose.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance 3
12/26/02
FUNOING ALTERNATIVES
Panel members extensively reviewed and discussed many of the possible
alternatives and types of funding mechanisms. Based upon their financial
and legal expertise and knowledge, several Panel members compiled
information on the subject, and made presentations to the Panel on each of
the funding sources and special district alternatives for canal system
restoration and maintenance. Attached, as Exhibit B is a list and chart
of the options analyzed by the Panel. Below is a summary of some of their
review:
Grants: The Panel concluded that the City should continue to seek
those sources of funding. However, they pointed out that many
grants require City matched dollars, and take time and resources to
obtain and implement.
State Appropriations: There are water resources projects throughout
the State that generally qualify, such as those which restore or
improve surface water and wastewater or stormwater discharges.
Two examples, which the City will be applying for, are the Lake Worth
Lagoon restoration funds, and House Bill 851 Water Project Funding.
Ad Valorem Taxes: The Panel looked at a Municipal Service Taxing
Unit (MSTU) or an independent special district with taxing authority
by special legislative act. The revenues can be generated through a
millage rate, authorized by law and must be approved by voter
referendum. If city taxes are dedicated for longer than one year at
a time, a referendum is required. An independent district would also
require referendum approval to levy an ad valorem tax.
Ad Valorem Tax Increment Financinq (TIF): Some cities use
Community Redevelopment Agencies (CRA's), which are generally
dependent districts for blighted areas. TIFs were also discussed as
an option.
Utility Taxes: Some cities receive taxes on electric, water, gas, and all
telecommunications.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
4
Non-Ad Valorem Assessments: Such assessments are levied against
benefited properties based on the benefit received. There are a
variety of institutional vehicles to levy such assessments without a
required voter referendum:
Special Assessment District - created by City Ordinance,
governed by the City Council, designates areas to receive a
special benefit from publicly financed infrastructure.
Municipal Service Benefit Unit - created by City Ordinance as
an area receiving special benefit. The assessments are paid
according to the relative benefits received.
Northern Palm Beach County Improvement District - City
Council can request legislative action to amend Northern's legal
boundaries to include all of Palm Beach Gardens, and request
the creation of a special unit for restoration and maintenance.
During their discussion, Panel members also considered the possibility of
forming an interlocal agreement with another entity to manage the City's
canals. They of ten discussed Northern Palm Beach County Improvement
District as such an entity. They recognized, however, that Northern Palm
Beach County Improvement District's territory currently excludes much of
the City's original sections, which need attention. The City could consider
contracting with Northern to perform the restoration and maintenance.
However, legislative action would be required in order to expand Northern's
jurisdiction, and the Governor's Office generally requires a public
referendum to support such action.
The Panel spent a great deal of time considering the creation a citywide
Municipal Service Taxing Unit (MSTU), with the authority, subject to public
referendum approval, to levy ad valorem assessments at a rate based on
assessed property values. For example, if one-quarter of a mill was levied,
generating $1 million in revenues, a property owner with a house value of
$175,000 and $25,000 homestead exemption would pay approximately
$37.50 a year while a property owner with a house value of $500,000 would
pay $118.75. However, the Panel felt that a MSTU would not be fair or
equitable because the tax rate would be based on assessed property values
rather than the benefits associated with improved flood protection.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
5
The Panel also compared a MSTU with financing a General Revenue bond, as
reflected by the attached Exhibit C. However, the Panel felt that bonding
generally costs more financially and administratively, due to underwriting
fees, reserve requirements and legal fees associated with implementation.
Considering the variety of alternatives, the Panel members re-examined the
non-ad valorem options, and discussed how everyone generally benefits from
a fully restored canal system that operates properly and effectively. They
also learned how properties contribute stormwater discharge to the City's
canal system, resulting in the need for continuous maintenance. Ultimately,
they recognized the need to have a dedicated source of funding for canal
system restoration citywide, and a separate dedicated source of funding for
continued maintenance.
Regarding restoration, the Panel felt that a Municipal Service Benefit
Unit (MSBU) is the most fair and equitable funding solution because it is
based on the benefits conferred upon all assessable properties in the
City, rather than assessed property values. Regarding maintenance, the
Panel was clear that a separate MSBU is needed for residents who
directly benefit from or contribute stormwater discharge to the City's
canal system.
After careful study and analysis of the historical as well as current
significant drainage problems in the City, as presented in this report, the
Panel unanimously recommends to the City Council the following strategy to
fund restoration and maintenance of the City's drainage system.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
6
RECOMMENDATION
An under lying theme of the Panel's recommendat ion is fairness and equity,
0
and the need to reinvest in our community. Regardless of where one
lives, all residents are affected by the City's primary canal system. As
a result, there is citywide importance to its restoration. There are
quality of life issues to consider regarding the need for these improvements
and maintenance, namely those that directly impact the public health and
safety of our residents, as well as City infrastructure protection and
enhancement of public and private property values. Therefore, the Panel
created the following two-part approach to establish dedicated sources
of funding, protected from the annual budget process and used
specifically for (1) restoration and (2) continued maintenance:
1. For restoration: In order to create one community regarding
stormwater, the primary stormwater system should be restored as one
City, one-time, and the costs of doing so should be borne by all assessable
parcels. As the best funding mechanism analyzed, the Panel unanimously
recommends that the City Council create a citywide Municipal Service
Benefit Unit (MSBU) for the purpose of fundinq the restoration of
the City's primary flood control facilities with a non-ad valorem
assessment aqainst - each assessable dwellinq unit and non-residential
unit in the City, not to exceed $15 per year for a period not to
exceed ten years.
0
The Panel recommends restoring the projects listed in Exhibit Al. The
total estimated capital costs are $10,793,000 (excluding the $800,000
that has been allocated for projects last year and this year).
AND
2. For maintenance: Only those who directly benefit from or contribute
stormwater discharge to the City's primary canal system should bear the
costs for future maintenance. As the best funding mechanism analyzed,
the Panel unanimously recommends that the City Council create a
separate Municipal Service Benefit Unit (MSBU) that would pay for
maintenance of the City's primary canal system qoinq forward throuqh
non ad valorem assessments.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
7
The Panel defined the maintenance MSBU area as the "base case plus," as
shown in Exhibit A4, on the neighborhood map titled "base case plus RCA
plus Cabana Colony." For location purposes, the Panel also referred to the
"base case plus" area as the central part of the City. The MSBU rate
would be based on the total number of benefit units, which is defined in
terms of estimated effective stormwater units (ESU's), or square
footage amount of impervious area. Based on the City Engineer's initial
calculations, the estimated MSBU maintenance fee would cost
approximately $63.04 each year for those units in the service or benefit
area.
Residents within the "base case plus" area of the City that have existing
stormwater management systems, for which they are already paying a
stormwater system fee, would receive a discount to their City assessed
annual fees. Attached to this report, as Exhibit 0, is a map of the areas
that would receive discounts for existing stormwater systems. As shown
on the map, they are the units of development maintained by the
Northern Palm Beach County Improvement District.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
8
METHODOLOGY FOR ESTABLISHING A MSBU FOR RESTORATION
The Panel did extensive research on stormwater assessments and found that
in 1994 and 1995, Sarasota County enacted three ordinances to define how
additional stormwater improvements would be implemented through special
assessment. The ordinances were challenged, and the Florida Supreme Court
held that they were legally sound. The Panel studied the methodology used
in Sarasota County, and borrowed certain portions of it to craft its
strategy.
The Panel learned about the legal standard that local governments follow to
establish a valid stormwater assessment. The two legal requirements are:
1. The property assessed must receive a special benefit from the
stormwater system; and
2. The assessment must be fairly and reasonably apportioned among
the properties receiving the benefit.
Essentially, the City must show a logical relationship between the
assessment and the benefits received by the properties. If the assessment
is challenged, this is the standard by which the courts would judge the
validity of the assessment. The Panel's legal expert on the subject of
special assessments advised that the courts historically have deferred to
the local legislative body, if there are sufficient factual findings to support
how the restored system specially benefits the assessed property and the
assessments are fairly apportioned.
Applying this standard, the Panel members felt that a restored and improved
citywide canal system would confer special benefits to all properties served
or potentially served by the stormwater system. Some of the benefits that
the properties could receive include:
o Improved flood protection for essential services for the entire
community, in particular during emergencies (i.e., fire rescue, police,
medical , water and sewer sys terns).
Improved roads.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
9
o Improved access to public facilities and services (i.e., schools,
community colleges, hospitals, fire and police stations, court houses,
parks and recreation facilities, libraries).
P Improved hurricane evacuation routes.
o Enhanced water quality and aesthetics of the environment.
o Increased safety and better access to property.
Improved values of residential and non-residential properties.
Regarding apportionment, according to the Panel's legal expert, as long as an
assessment is not arbitrary, unreasonable or discriminatory, the courts
should uphold it as valid. Apportionment according to a precise calculation of
benefits to each individual property is not required, only that it is
reasonably fair. Following the approach used in Sarasota County, property
that contributes polluted stormwater runoff would be specially benefited by
the treatment of that runoff. Untreated stormwater often leads to
flooding. As an example, historically, Unit 2 runoff has contributed
significantly to flooding in Plat 4.
The Panel also recoqnized that to be consistent and fair, all benefited
properties in the City should be assessed. In effect, the whole City
would become a benefit unit for purposes of canal system restoration.
Exemptions can occur only if they are allowed by statute, or if a
determination is made that the property receives no benefit. Federal
properties and the U.S. Postal Service are exempt by statute. Churches are
not exempt from special assessments, but they are exempt from ad valorem
taxes. Schools could be included if prior approval is obtained from the
school board.
In defining relative benefit and cost, the City Engineer would need to
evaluate the geographic areas throughout the City, and then look at the
relative contribution of stormwater runoff produced by properties in those
areas. Based on a preliminary evaluation by the City Engineer, there are
approximately 17,000 dwelling units (such as single-family, multi-family,
condominiums, apartments and rnobi le homes), 65,000 non-residential units
without impervious area (such as vacant land and preserves), and 150,000
non-residential units with impervious (such as commercial, industrial and
institutional areas). The restoration assessment rate would generally be
based on dwelling units and impervious area. 0
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
10
The City needs to generate approximately $1 million in revenues each year,
for a period not to exceed ten years. All dwelling units would be grouped
together under one rate and used to obtain a statistically significant
sampling of impervious area to determine an average square footage of
impervious area per residential unit.
0
Based on initial calculations, the MSBU fee assessed to each residential
property owner for restoration would not exceed $15 a year for ten years.
This is a conservative estimate. Non-residential parcels would be assessed
on an equivalent square foot of impervious area basis. Each year, a City
resolution would need to be adopted to set the assessment roll which would
account for when undeveloped property becomes developed, in order to
capture those assessments. As a result of adding more properties to the
assessment roll, the rate per unit could decrease as more property owners
share the assessment burden. The MSBU for restoration would sunset at
the end of the tenth year. if not sooner, and the canals would be at a
minimum restored to their oriqinal conditions.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
11
HOW AND WHY THE STRATEGY WILL WORK
1.
2.
One MSBU would fund canal restoration and a separate MSBU
would fund continued maintenance. Those dwelling units and non-
residential units in the maintenance benefit area would pay both the
restoration MSBU rate and the maintenance MSBU rate for the term
of the restoration MSBU (not to exceed ten years). For residents in
the maintenance benefit area, this would cost a total of approximately
$80 each year. Starting the eleventh year, those in the maintenance
benefit area would only pay the maintenance assessment fee each
year. Those outside of the maintenance benefit area would only pay
the restoration assessment fee for a maximum of ten years.
Who is soinq to benefit from this stratesy? - First, all of our
residents because our primary canal system will be restored to its
original condition. In particular, the quality of life issues associated
with canal restoration are the significant benefits in the short term.
Localized street flooding is a typical example of such impact. The
primary canal system is designed to decrease the amount of standing
water in the streets, improve water flow to the inlets, and increase
water storage to the overall drainage system. This benefit would be
provided at a total cost of approximately $150 for each homeowner,
and the restoration MSBU will sunset in ten years, if not sooner, with
canals fully restored.
Importantly. a restored primary canal system will protect critical
public infrastructure such as roads, potable water and sewer
systems, recreational areas and public health and safety facilities.
Hurricane evacuation will be improved as well. The result will be
substantial special benefit to all public and private property in the
City by the protection and enhancement of value.
Second, in the long term, the continued maintenance will benefit those
living immediately adjacent to and directly contributing to the City's
canal system. All of the communities in the Northern Palm Beach
County Improvement Oistrict Units of Development with a permit
from the South Florida Water Management District will receive a
credit for their existing water storage systems, based on the quantity
of water stored and the runoff generated. With the MSBU for
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
12
0
0
maintenance, funds will be dedicated to ensure that those who
directly benefit continue to support the canal system and not allow
it to fall into disrepair asain.
3. What differentiates this strategy from previous efforts to create
a Stormwater Utility in 2001?
(a) Since then, the City created a Stormwater Management Plan
that is being implemented. Projects have been identified and
prioritized, and additional work anticipated in the Plan has been
investigated. We now know what needs to be fixed or improved
and the costs to do so.
(b) For future maintenance, the Panel felt that the residents would
positively benefit from the City's improvements to and
operation of the Cabana Colony Canal and the RCA ditch.
Therefore, the service area as defined by Florida Statute for a
MSBU would be expanded to include residents living in those
sub-basins. This would result in an overall decrease in the
annual user fees.
(c) As reflected by the City's current budget, ad valorem taxes are
paying for some canal system restoration. However, this
revenue source has not historically provided enough funding to
accomplish the projects necessary. Having a restoration MSBU
dedicates those funds separately and guarantees that the
restoration work continues, above and beyond funds that may or
may not be provided through the annual budget process.
(d)Under the Panel's approach, all residents would pay for
restoration, and then only those who directly contribute
stormwater discharge to the canal system would pay for future
maintenance.
(e)The Panel members will help with presentations to the
neighborhoods. A thorough public education program will be
implemented so that residents clearly understand the benefits
of this solution. Citizens will talk to citizens.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
13
4. Why include improvements to the Cabana Colony Canal and the
RCA Ditch as referenced in the Stormwater Management Plan?
Both have a significant impact on the City's drainage system. The
Cabana Colony Canal will provide a second outfall for Unit 2 where
there has historically been flooding. The City Engineer has advised
that water surface elevations flood homes and not the size of the
rainfall event. With a second outfall the water surface elevation
could be lowered by approximately a foot, without releasing waters
beyond the permitted 25-year three-day storm discharges, and as a
result, reduce the potential for future flooding.
Since the flood in 1995, the City has provided many capital
improvements along the RCA ditch. What is mostly needed at this
time is maintenance work, such as tree removal near area
neighborhoods, re-grading the bottom of the ditch and rebuilding the
canal banks so that water run off does not continue to erode them.
5. The solutions for both canal restoration and maintenance are
interconnected. One cannot succeed without the other. An ordinance
must be adopted to ensure sufficient funding is available for
restoration citywide, and a separate ordinance must be adopted to
ensure sufficient funding for future maintenance. The goal is to bring
the entire City up to the same level of protection as the newer
communities that are already being maintained by the Northern Palm
Beach County Improvement District.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
14
CONCLUSION
The Panel strongly recommends approval of the funding strategy outlined in
this report, to establish a MSBU for canal system restoration, and a
separate MSBU for ongoing maintenance. The projects, costs and their
benefits are known and identified. Through the Panel's deliberations and
analysis of the findings, the Panel has created a solution for funding the
improvements and maintenance in a fair and equitable manner.
Implementing this strategy eliminates the need for continuing the current
$400,000 annual appropriation for canal restoration and provides a
dedicated revenue source, separate from the City's annual budget process.
At the $400,000 funding level, it would take approximately 25 years to
complete the restoration projects outlined in the Plan.
The Panel is recommending the MSBU for restoration because they believe
it is the fairest solution. All properties would be assessed at a rate based
upon benefits from the City's primary flood control facilities. The Panel
understands that if the City does not create a restoration MSBU, the
problem is not diminished. The City will need to find another way to continue
canal restoration. The Panel's strategy will help us improve water storage in
a more timely fashion. With a dedicated funding source, we will be able to
assure a fully restored and improved canal system within ten years. By
regaining the maximum operational efficiency of our canals system, we can
reduce the chances for another high water incident in our community.
The Panel is recommending the MSBU for the ongoing maintenance because
it reflects the most equitable way to fund long-term maintenance activities
in the areas that benefit, similar to the way in which others pay Northern
Palm Beach County Improvement District for their benefit. The Panel
looked for ways to keep maintenance costs as low as possible for the central
or original parts of the City. The MSBU would replace the $1 million in the
City's current budget that is used for canal and swale maintenance.
Overall, this approach to canal system restoration and maintenance is based
upon principals of fairness. The restoration and maintenance activities must
be done. The underlying equitability is that all property owners would pay to
restore the canal system to its original condition, and then those who
continuously benefit would maintain it.
Blue Ribbon Panel Report on Canal System Restoration and Maintenance
12/26/02
15
BLUE RIBBON PANEL n
REPORT ON CANAL SYSTEM RESTORATION AND MAINTENANCE
EXHIBITS
Exhibit A:
Overview of restoration projects identified in the Stormwater
Management Plan and Neighborhood Maps
Exhibit B:
List and chart of funding sources and special district alternatives for
stormwater capital improvements and maintenance
Exhibit C:
Comparison between MSTU and General Revenue Bond for restoration
Exhibit 0:
Map of areas to receive discounts for existing stormwater systems
(Northern Palm Beach County Improvement District Units of
Development)
0
I
BLUE RIBBON PANEL n
REPORT ON CANAL SYSTEM RESTORATION AN0 MAINTENANCE
BLUE RIBBON PANEL 0
REPORT ON CANAL SYSTEM RESTORATION AN0 MAINTENANCE
EXHIBIT A
Exhibit Al: Overview of restoration projects identified in the
Stormwater Management Plan
Exhibits A2 - A4: Neighborhood Maps
A2 - Base Case
A3 - Base Case Plus Cabana Colony Canal
A4 - Base Case Plus RCA Blvd. brainage Ditch Plus Cabana
Colony Canal
0
0
EXHIBIT A
Exhibit Al: Overview of restoration projects identified in the
Stormwater Management Plan
Exhibits A2 - A4: Neighborhood Maps
A2 - Base Case
A3 - Base Case Plus Cabana Colony Canal
A4 - Base Case Plus RCA Blvd. brainage Ditch Plus Cabana
Colony Canal
EXHIBIT A1
PALM BEACH GARDENS - CANAL RESTORATION
A. Prioritv Canal Restoration Proiects Identified in the Stormwater ManaPement Plan
B. Additional Areas Identified in the Stormwater Management Plan That Reauired Further Investigation
I Eannan (Military Tr. To 1-95)
Earman (1-95 to Thompson River)
Earman (MacArthur to C-17)
Allamanda Canal (Gardens East Loop)
Allamanda Canal (Gardens East Main Canal from Lighthouse to Prosperity Farms Road)
Allamanda Canal (Sandalwood Estates from Burns Road to G.E.M.)
Bellwood South
Bellwood North
Consumer Canal from 1-95 to C- 17
Gardens Oaks Canal (Military to 1-95)
City Participation in Design of the S-44 Structure
City Participation in Construction of the S-44 Structure
Total Estimated Capital Cost $3,024,000
Total Estimated Capital Cost for Base Case of Improvements (A + B) $8,493,000
C. Cabana Colonv Can a1
Atlantic Rd. to Cabana Colony Canal
Cabana Colony Canal (A-1-A to Frenchman’s CS)
Cabana Colony Canal (Frenchman’s CS to Prosperity Farms Rd.)
Cabana Colony Canal (Prosperity Farms Rd. to Intracoastal Waterway)
Cabana Colony connection to EPB -3
Total Estimated Capital Cost $1,748,000
I D* RCADitch
A- 1-A to Campus Drive
Campus Drive to Prosperity Farms Rd.
Prosperity Farms Rd. to Intracoastal Waterway
Total Estimated Capital Cost $ 552,000 a Grand Total Estimated Capital Costs $10,793,000
BLUE RIBBON PANEL
REPORT ON CANAL SYSTEM RESTORATION AND MAINTENANCE
EXHIBIT B
List and chart of funding sources and special district alternatives for
stormwater capital improvements and maintenance
FUNDSOURCE
Exhibit B FUNDING SOURCES FOR STORMWATER CAPITAL
IMPROVEMENTS/MAINTENANCE
1. FederalGrantdhans
2. StateGrantdLoans
3. State Appropriation
(as part of a regional project)
4. Ad Valorem Tax
5. Non-Ad Valorem Assessments
6. Ad Valorem Tax Increment
0 7. Utility Tax on Telecommunications
8. Stormwater Utility Fees
9. Ad Valorem Bonds
10. Non-Ad Valorem Assessment
or Revenue Bonds
FUNDING GOVERNMENTS
EPA
Department of Environmental Protection
Florida Legislature
Palm Beach Gardens
Independent Special District with Tax Authority
PalmBeachGardens
Special Assessment District (Palm Beach
Gardens - Ch. 170, F.S.)
MSBU (Palm Beaoh Gardens - Ch. 166, F.S.)
NPBID (Special Legislative Act)
New Independerit Special District (Special Act)
Community Redevelopment Agency (Palm Beach
.
Gardens - Ch. 163, Part III, F.S.)
PalmBeachGardens
Palm Beach Gardens
*Palm Beach Gardens
*Independent Special District with Tax Authority
Palm Beach Gardens
Special Assessment District
MSBU
NPBID
New Independent Special District
*Requires Referendum Approval
P a
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e ill nn
BLUE RIBBON PANEL n
REPORT ON CANAL SYSTEM RESTORATION AN0 MAINTENANCE
EXHIBIT C
Comparison between MSTU and General Revenue Bond for restoration
Exhibit C
4. Absent a new revenue source, would
probably require a tax increase to offset the
pledge on existing revenue sources -
COMPARISON OF CANAL RESTORATION FUNDING OPTIONS
Option 1 - MSTU
Advantages: I Disadvantages:
1
1. Eliminates cost of money factor (interest
(underwriting costs, reserve requirements,
etc.1
1. Requbes voter approval
2. Timing for referendum is poor (other tax
issues are on ballot)
I 3. Shorter time me (10 years vs. 20) I 3. Extends time to begin until next year
4. Eliminates the need for continuing the
current $400,000 annual appropriatiin for
storm water improvements
5. Segregates tax increase from the general
(after referendum)
4. Double taxation for residents currently
paying NPCID
operating millage rate
6. Provides a dedicated revenue source
7. Does not require a pledge or creation of
any other general fund revenue
Option 2 - General Revenue Bond
Advantages :
1. Could spread cost over longer period,
e.g., 20 years, resulting in lower annual
impact to residents than MSTU for 10
vears
2. Requires no voter approval, as opposed
to G/O debt
3. Could be done much sooner than
creation of an MSTU
4. Provides a dedicated source of funding
for restoration.
Disadvantages:
1. This type of financing has high costs of
issuance (underwriting fees, reserve
requirements, legal fees, etc.)
2. Purchases less hard construction per I
dollar due to costs and interest expense
3. Would require a pledge of an existing or
creation of a new revenue source I
t
CITY OF PALM BEACH GARDENS
MEMORANDUM
TO:
DATE: August 6,2002
FROM: Allan Owens, Finance Administrator
SUBJECT: Financing Options
Sheryl Stmart, Assistant to the City Manager
As requested, I have Zevimed two possible options for financing $5,000,000 fix cad
restoration. The first do is based on a bankqualified loan with a ten-year
amortization. The second option is based on a bond issue that would net $5,000,OOO,
after costs, with a twenty-year amortization.
Effect on $125,000 H6me
With $ 25.000 Ex emntion
Amount ' Debt wage
Financed Senrice Eauivdent
Option 1 -
10-YearBank
QualifiedLoan $5,000,000 $613,390 .14 $14 Annual Inorease in Taxes
Option 2 -
20-Year Bond
Issue $5,575,000 w25,OOo .10 $10 hual Increase in Taxes
The amount financed in the bond issue scenario is greater than the amount required
because of additional costs and reserve 8ccoullf requirements that would be added to the
issue amount. However, the annual debt service is lower due to the twenty-year venrrmp
ten-year amortization,
If you have any questions, please let me know.
BLUE RIBBON PANEL
REPORT ON CANAL SYSTEM RESTORATION AND MAINTENANCE
EXHIBIT 0
Map of areas to receive discounts for existing stormwater systems
(Northern Palm Beach County Improvement District Units of
Development)
I t
.. -. . f t I
I
m