Submitted by Suanne Z. Thamm
Reporter – News Analyst
What a difference a day makes. On August 21, 2012 at a regular city commission meeting, with a one-two punch that no one saw coming, Fernandina Beach City Commissioners Charlie Corbett and Sarah Pelican joined with Commissioner Tim Poynter to defeat an ordinance amending the city’s franchise agreement with Florida Public Utilities that would have, among other things, allowed for the increase in the franchise fee on which the city’s FY 2012-13 budget depended.
While Poynter has remained consistent in his opposition to this budget which proposed to raise both millage and franchise fees, Corbett and Pelican had expressed no opposition to this budget during multiple workshops, the most recent of which was held on August 20, 2012, the day before the franchise vote was taken. During that previous meeting Mayor Arlene Filkoff had asked commissioners to express any reservations or problems in moving forward with the second option recommended by City Manager Joe Gerrity: a millage rate of 6.3001 and an increase in the franchise fee to 7.32% to produce a budget of $9,350,000 budget with a reserve of roughly 22%. Neither Corbett nor Pelican questioned the need to proceed with the budget as Gerrity presented it.
But that was Monday, August 20. Everything changed on Tuesday, August 21, when what appeared to be a routine amendment to the city’s franchise agreement with Florida Public Utilities (Ordinance 2012-18) came up for a vote. The amendment would have raised the cap on possible increases in the franchise fee from 6 to 10%, thereby allowing the city to proceed with raising the fee to the 7.32% as recommended in City Manager Gerrity’s FY 2012-13 budget proposal. Vice Mayor Jeffrey Bunch moved approval, and hearing no second, Mayor Filkoff stepped down from the chair to second the motion. There was no discussion. When the vote was taken, the motion failed on a 3-2 vote, with only Filkoff and Bunch supporting it.
The City Manager and the Mayor both appeared thunderstruck. The audience watched in stunned silence. Mayor Filkoff suggested that another budget meeting was probably in order, and City Manager Gerrity asked that the topic be revisited at the end of the meeting. And it was.
Mayor Filkoff took control of what could have been an extremely chaotic situation and suggested another budget workshop to discuss the franchise fee the following week. She asked the commissioners to provide guidance to the city manager on what types of information he needed to prepare for their deliberation. Commissioner Corbett indicated that he would be out of town the following week. Commissioner Pelican said that she has always been against raising the franchise fee. Commissioner Poynter said that he has consistently disagreed with the current budget proposal and that his vote reflected that.
Filkoff then turned to Gerrity and asked what kinds of proposals he could bring back for consideration if the proposed franchise fee hike to 7.32% would be cut back to 6%, the maximum allowed under the current franchise agreement with FPU. Possible options involved gutting the contingency reserves; eliminating the $250,000 set aside for beach renourishment; cutting back or eliminating budgets for street repaving and sidewalks.
Filkoff reminded commissioners that the option of using franchise fees in lieu of additional millage hikes was a way to spread the burden of paying for services to all residents, not just property owners. Commissioner Corbett remarked that he did not support raising the franchise fee to pay for the Forward Fernandina projects. A clearly exasperated but controlled Filkoff asked City Manager Gerrity. “Is the proposed raise in franchise fee going to Forward Fernandina projects?” He responded firmly, “No, ma’am.”
Filkoff went on to explain to the commission and the audience that the city has always had franchise fees. The fee was raised from 4.5 to 5.05% last year to finance debt for capital improvement projects authorized under the initiative named “Forward Fernandina” (waterfront improvements, library renovation and the Alachua crossing). However the rise from 5.05 to 7.32% was unrelated to those projects and would help make up for city revenue shortfalls created by declining property values and pension issues. She expressed frustration that the first thing to be cut to save money always seems to be maintenance issues like street repaving that end up costing the city more money in the long run.
Commissioner Poynter, in explaining his opposition to the current budget, said, “The city needs to get really creative [in solving budget problems]. It is running out of positions to cut, and the people are running out of patience. The old approach of just saying ‘this is how we’ve always done it’ won’t work any more.”
Neither Corbett nor Pelican offered any ideas for making up the shortfall created by their failure to authorize the increase in the franchise fee.
The consensus of the commission seemed to be to make up the franchise fee shortfall by gutting the city’s contingency reserve from $408,334 to around $70,000. This means that the city’s total reserve will fall back to 20% from the 22.46% that had been proposed previously.
City Manager Gerrity asked if he could direct staff to move forward with confidence to prepare the final budget to include a 6% franchise fee. Other than Poynter, no one expressed opposition.
Mayor Filkoff asked Gerrity if he was comfortable moving forward with such a budget. He responded that he was not comfortable.
In light of what appeared to be a consensus decision, the FBCC will not hold an additional budget workshop before the first formal public meeting in the budget approval process scheduled for September 4, 2012. It remains to be seen whether the revised budget proposal reflecting the 6% franchise fee will pass muster by receiving at least four votes from city commissioners at that meeting.
August 22, 2012 11:45 a.m.
The last line was a misquote. Mayor Filkoff said “Lord treat me tomorrow the way I treated others today.”