During a workshop held on July 22, 2015, Fernandina Beach City Commissioners (FBCC) began considering the FY2015-16 budget proposal publicly for the first time. The FBCC began with consideration of city enterprise funds and grants to non-profit agencies.
Unlike previous years during which several budget workshops were held prior to setting the tentative millage rate, this year there will be only a matter of minutes between the second workshop and the Special Meeting to set the tentative millage rate for FY2015-16. Discussions of the General Fund budget will take place at the second workshop on July 28, 2015 from 3-4:55 p.m. to be followed at 5:00 p.m. by a Special Meeting for the purpose of setting the millage rate for the next fiscal year. Both meetings will be held in Fernandina Beach City Hall Commission Chambers, 204 Ash Street, Fernandina Beach. The millage rate set at the Special Meeting may be decreased as commissioners continue to discuss the upcoming budget, but cannot be raised.
Commission discussion of enterprise funds at the budget meeting was somewhat hampered by discrepancies between materials given to commissioners in advance of the meeting and those presented in slides during the meeting. The city’s enterprise funds are used for operations at the airport, utilities, golf course and marina. Enterprise funds are used for services provided to the public on a user charge basis, similar to the operation of a commercial enterprise.
The general fund item on the agenda for the July 22 workshop was the city’s grants to non-profit agencies. Additionally, at the request of City Manager Joe Gerrity, Nassau County Economic Development Executive Director Laura DiBella appeared before the commission to request restoration of funds that had been directed toward NCEDB efforts on behalf of the city in previous years. This funding was dropped from the current budget. Traditionally, any discussion of grants generates much debate, and this year was no exception.
Fernandina Beach Municipal Airport
City Manager Joe Gerrity, who also serves as the Airport Manager, presented this item to the FBCC. The budget proposal calls for $400K to be expended on capital improvement projects next year to include the operations and welcome center building, east area access and control, airport master plan updating and the welcome center concept and financial plans. Gerrity is also proposing to add a full-time airport manager. Gerrity’s budget shows anticipated revenues and expenses for the airport at $1,864,598 (down 43.4% over the current year budget). Decrease in revenue resulted from a drop in FAA and FDOT grant money received; increased expenses are anticipated in part time salaries and communications costs.
Utilities Director John Mandrick walked commissioners through the new budget proposal for water, wastewater and stormwater. Mandrick explained that the water and sewer funds are very sustainable, as long as there are no major storms. He said that water revenues fluctuate, depending on weather conditions. A rainy year will mean less water is used for irrigation, which accounts for 70 percent of water used. This in turn leads to a decrease in city revenues. He indicated that Utilities continues the sewer relining project to insure integrity of the system. He also expressed hope that he will be able to begin replacing the existing sewer system in Old Town with the gravity system used elsewhere in the city. There is also an ongoing expense to replace water meters, which become calcified after 15 years.
Summary slides of Mandrick’s budget appear below:
With respect to stormwater, Mandrick cited the loss of a state grant to improve the drainage situation on North Fletcher. When asked what the city could afford to do without that grant, he responded, “Swales. We can build swales.” Mandrick added that residents in some parts of the city work against the beneficial nature of swales by landscaping them, thereby defeating their purpose.
Municipal Golf Course
Chris Cygan of Billy Casper Golf (BCG) introduced his team and highlighted the past year’s accomplishments, including high marks for customer service, greens improvement, increases in rounds played and memberships. He also spoke to alternative golf programs, such as foot golf, which have been successfully launched at the city course, and the 5-year contract signed with Bonhams Auction House to continue their car auctions at the golf course during Concours d’Elegance week. While golf course activity continues to increase, the budget still reflects more than a half-million dollar debt, which the city incurred in building the clubhouse prior to BCG’s arrival.
Just as BCG must deal with inherited debt, city marina management company Westrec must also deal with inherited debt. Marina Director Joe Springer reported that significantly lower fuel prices have resulted in increased fuel sales, but lower than anticipated revenues. He explained several initiatives underway to improve the marina and services to boaters: repair and replacement of portions of the breakwater dock, completion of Dock 6 fire lines, and expanding the mooring field. He added, “Fernandina Beach needs more than docks that we are constantly working on to make better.” He is exploring the possibility of special events and limited alcohol sales to increase revenue.
Nassau Economic Development Board (NCEDB)
Two hours into the meeting, City Manager Joe Gerrity invited NCEDB Executive Director Laura DiBella to address the FBCC on her request for funding. Gerrity explained that DiBella had asked to make a presentation in August but that he had invited her to do so at this meeting. She recapped the Nassau Tomorrow campaign in 2012 during which the city had committed $25K for 5 years to promote the city to potential non-residential developers. She said that funding had been pulled last year and she was requesting that it be reinstated. “We’re doing a lot for the county and the city; we are working tremendously hard. Hopefully everyone will see the benefits of that, the fruits of our labor very soon with some upcoming announcements. I would appreciate your support, symbolic and otherwise.”
Commissioner Tim Poynter said he would like to reinstate the commitment at its previous level, when half the amount came out of the airport fund. Gerrity said that in light of a recent complaint over use of airport funds, he was not willing to support co-mingling airport funds with city funds for this purpose. Poynter said he understood. Commissioner Robin Lentz asked where the $25,000 would come from. Gerrity replied that it would have to come from the General Fund. Lentz expressed support for giving money to NCEDB, but expressed concern over the amount, explaining that the city is reviewing grants for non-profits and has just committed funding for the Main Street Program, which is also economic development. She said she also anticipated the city’s hiring a full time airport manager, whose job would also involve economic development at the airport.
Vice Mayor Johnny Miller said that he wanted to know where the money would come from. Comptroller Patti Clifford said that it would come from the General Fund, out of the Commission’s Fund, and the reserves. She said that $25,000 would “probably not affect the city’s 25 percent reserves at all.”
Miller said that he was hesitant to commit $25,000. Poynter did not take issue with that but he added, “The message I would like to send to the community and to people thinking about the community is that we are a community willing to invest in their coming here. I think the Main Street Program shows that. Things that generate interest in Nassau County generate interest in the city and vice versa. We need to attract one big customer here. We should build on a partnership, and I look upon that as smart investment. … I have a problem when the city says we are so supportive of small business, if we don’t step up a little bit to try to put our money where our mouth is.”
Commissioner Pat Gass said she definitely supported bringing new business to the city. But she cited the commission’s recent commitment to funding the Main Street Program in the amount of $40K per year for three years. She expressed a willingness to split that money, with half going to Main Street and half to NCEDB, because NCEDB’s efforts would include more than just the Centre Street area. “The flip side of that,” she said, “is that we found out last night we need 12 additional firemen at a cost of $1.2M; we have a building [City Hall] that needs a lot of work; a million dollars we did not get from the state for stormwater; and the list just goes on. Although bringing new business to the city is definitely a priority. I wish we could adjust the money going to Main Street so that we can help all of the island. …”
Mayor Ed Boner also expressed his support for funding NCEDB in some amount. Boner addressed Gass’ suggestion with respect to splitting the Main Street funding by reminding everyone that the application had already been sent off and had received high marks. He said, “I think what you have to think about is the importance of attracting big business, which has a trickle down effect. It’s a big deal to bring people who both work and live here.” He added that attracting businesses and commercial development added to the tax revenues without a corresponding increase in the need to provide the type of services that residential development requires. “I support the idea,” he said. “It’s a great idea.”
Boner recognized Miller, who said that he understood Boner’s trickle down argument, but he questioned adding the money to a county organization. “When we talk about $25K and what our citizens want,” he said, “we might be better off pinpointing the funding for something that benefits downtown business owners, like the Chamber of Commerce. Or that non-profits will end up with this money [to be spent locally]. I’d like to inject money directly into a city program rather than a county program.”
Miller then turned toward DiBella as he continued his remarks. “I can’t get past the whole … you know recently the only contact I’ve had with Ms. DiBella is the ongoing issue that our local community had with growth as far as business which might be opening here locally that concerned a lot of residents of our neighborhoods. [The residents] expressed that via the Kinder-Morgan issue we had with the Port, also their concerns about certain businesses not fitting in with city as far as producing pollution, fumigation and issues like that. At a meeting I heard Ms. DiBella say [citizen concerns] were making her job tougher. … Her side was the rhetoric was making it tougher for her, and there was some almost—I don’t want to say condescending—but referring to the people of Fernandina Beach as ‘You people need to stop because you are making my job tougher…. you’re putting a stain on growth.’ It became almost adversarial. So to have the people’s money, the money that people have paid into an organization that has publicly stated they’re concerned about the people being too vocal about what’s going on in the community, that seems to be a little of a push back on that. I think if we asked the people who were in those rooms, they would have a problem paying into an organization that they felt like wasn’t supportive of what they were trying to accomplish. They were called anti-growth, anti-industrial when what they were actually doing was expressing concerns about dirty growth. I think we should look at our local business organizations, our Chamber of Commerce instead of having it trickle down from the top. I don’t like hearing $25K isn’t a lot of money. Ten thousand, even one thousand could be better spent injecting it directly into the community instead of hoping it comes down from the top.”
Boner addressed the significant amount of tax money that flows into city and county coffers from taxes paid by city residents and city industry. He said that even if NCEDB money helps develop the Crawford Diamond west of I-95, there would be a local benefit in decreased tax burdens.
DiBella asked if she could respond. Addressing Miller, she said, “I respect your opinion. You are absolutely entitled to your opinion, and I am sorry that we were of differing opinions in this particular situation. You have to remember, though, what my job is. I’m not only here to recruit companies. I’m here to defend the companies that are here. I was speaking on behalf of the voice of the business community and the 700-plus employees that were potentially affected. I have to tow the line, so to speak, between what pleases the public and the businesses that are already here and paying into your tax base now. I felt that the current taxpayers quite frankly were the ones who needed defending in this situation. I never said that what was going on was invalid or that everybody’s opinion was not warranted, their fears, all of that. I understand that. But it would devastate this community if we were to lose one of these two mills, and I think we all understand that. So I had to defend them. And I’m sorry that we don’t agree on that.”
Miller replied, “Herein lies the problem for me, and I’m glad you said it that way. No one that I’ve heard at any of these meetings has said anything derogatory about the mills. The mills filled this room. They came in and said, what you’re doing is going to hurt us. No one went after the mills.”
Commissioners Gass and Lentz interrupted simultaneously saying, “They did.” Miller bristled at this, asking how they went after the mills.
In an attempt to refocus the discussion, Lentz said, “The issue before us right now is whether we are going to give [the NCEDB] money.
Miller again spoke, mispronouncing DiBella’s name after she had corrected him. In a raised voice he said, “I heard her say that she was defending the mills, I didn’t hear Port [as Gass had interjected]. Bringing the mills into this is why I have a hard time with the NCEDB position. I’ve heard two commissioners just state the people went after the mills. I’d just like to ask, in what way do you feel like the people went after the mills?”
At that point Boner said, “I think we are moving into the weeds a little bit. It would be better to talk about this issue at another meeting.” Other commissioners agreed.
Miller said, “That’s exactly my point. We got pulled into the weeds based upon what [DiBella] said. I just said I don’t think we should be injecting money into an organization when people don’t think their voices are being heard.” Miller emphasized, “I cannot state clearly enough that the people and organizations that have met and are concerned about the [Port] Master Plan have not involved the mills whatsoever, yet I’ve heard two commissioners say they did. The people are going to want to know how they did this.”
Boner spoke again, emphasizing that they were getting too much into the weeds.
Miller said, “I obviously don’t support paying into this [endeavor].” DiBella said she respected that and was okay with his decision.
Commissioner Lentz proposed that the FBCC fund the NCEDB in the amount of $12,500, the city’s half of the original commitment that came from the General Fund. She felt that the remaining $12,500 would be devoted to the airport manager’s job, which included economic development and marketing of the airport. Poynter agreed with Lentz.
Lentz also noted that the NCEDB is funded by Nassau County and that Fernandina Beach pays Nassau County taxes in addition to city taxes. DiBella acknowledged that. “I honestly think we are pretty easy to market,” Lentz said, “because we are pretty awesome.”
Gass also indicated she could go along with a $12,500 commitment to NCEDB. Boner told DiBella, “So you have four commissioners happy with $12,500. And if you need any kind of letter of recommendation from the city, I’m sure at least four of us would support that.”
Because the budget meeting was a workshop, no formal action could be taken to finalize the decision. The parties, with the exception of Miller, thanked each other for their work and support.
There was no handout for this presentation, although Comptroller Clifford allowed that in previous years commissioners had been provided with a spreadsheet presenting organizations and amounts requested from the city. She explained that the city has set aside $25K to help poverty level residents with sewer bills. She also indicated that there is $1,000 support for Keep Nassau Beautiful that comes out of a separate account, and that the Amelia Island Museum of History is now a line item in the budget being funded at $10,000 for FY2015-16. She told commissioners that $15,000 has been set aside for them to allocate to fund various non-profit grant requests, adding that the FBCC could increase or decrease that amount at their discretion. She asked that at the end of the workshop commissioners decide on a total amount that they wish to earmark for these grants, even if they are not prepared to make a distribution at this time.
Miller said that he wanted to see the level of funding for the Council on Aging (COA) restored. Poynter agreed, adding that he had raised that during his one-on-one budget briefing, recognizing that he was only one commissioner. He said that he wanted their funding to be made a line item in the budget—like the Museum—“so they don’t have to come to us hat in hand every year begging for money. If they didn’t exist the city would be responsible for helping these people get around. It’s the elderly who need the help, and we have no public transportation.” Other commissioners added their support. Miller and Poynter both stressed how COA is able to leverage contributions on a 10-1 basis in seeking great funding from other government agencies.
Clifford advised the FBCC to do what they felt was proper with respect to allocating funds for the nonprofit grants. She said that in light of the total size of the General Fund budget, which has not yet been discussed with commissioners, this is a very small portion. She asked the commission for a number so that she could go back and calculate where the city’s reserves will stand for the next budget year.
Commissioner Gass said that she would bring forth with the City Attorney’s assistance, a resolution that would do away with the $42,000 in the budget allocated for health insurance payments for city commissioners, which would allow that money to be reprogrammed for funding nonprofits. “That would be a better use of taxpayer dollars,” she said. There was no discussion.
Miller suggested that the city move COA funding to a line item and authorize an amount of $30,000, representing their request for the coming year. Gass said that she did not support the line item, “but 4 out of 5 win.”
Clifford agreed to provide commissioners with information on outstanding non-profit requests and a ranking sheet to be completed before the next workshop. The consensus seemed to be that commissioners would limit distribution for remaining grants to $15,000. Gass reminded commissioners of the need to set a millage rate.
Clifford ended the discussion with a question on the future of a fund that currently holds $490 and consists of seven donors who have agreed to contribute a nickel per day to support non-profits. She said that it costs more to administer this fund than the amount collected justifies. Commissioner Gass had spearheaded this program initially, but there has been little community interest. Poynter said it had been a good effort, but Boner said that because contributions were not tax deductible, it did not generate a lot of interest. It was the consensus of the FBCC to end the program.
More discussion on the mills
Following a public comment at the end of the meeting, Miller once again returned to a discussion of the mills. He said he wondered where the perception has come from that that the citizens opposing elements in the Port Master Plan are against the mills. Poynter said that he would speak for himself. “I’m not saying that the people are going after the mills,” he said. “The perception is when you have so many mill people show up at a meeting, they are concerned that someone is going after them. Whether you say it or not, the unintended consequence of some of the things that were being proposed was that the mills felt threatened. The mills would not engage in the discussions because they felt that in the future some of the changes being proposed could adversely affect them. So their being here was an example of their being concerned. Perception is reality. When they fill this chamber with people, it wasn’t because of the Port. It was because they felt their livelihood threatened. Whether anyone used their name or not, what they heard through the actions of the community was that they are being threatened.” Commissioner Gass agreed with Poynter.
Boner said he believed that when the mill people saw the potential of changing things in their zoning category for one activity (the Port), they would be next. Some of the proposed changes could have indirectly affected them if not now, in the future, he said. And the perception is when there is a merger or a big project involved, investors look at what is going on in the community to learn whether the local population is supportive of industry. My impression is that most of the commission feels the mills are important, jobs are important, and people who live here are important. We just need to find a way to coexist together. … Sometimes it’s easy to just sort of get carried away over things that may never come to be.”
Boner referenced a letter he had received from WestRock (see above) in which the company indicated it had no intention or plan for receiving coal by ship. Poynter said that he had spoken with WestRock plant manager Tom Sweetser reinforcing this while adding that “forever is a long time.” Gass jumped in asking, “So when is it a good idea to try to shut down the Port?” Gass reminded Miller, “When they shut down, you and I will pay their bond, and we will pay dearly. Should we keep an eye on them? Yes. To try to shut them down, tie their hands behind their backs just because Kinder Morgan has a name around the country for not being a good guy does not mean that we should start attacking them. They are still our neighbors.”
Boner and Lentz tried to get the meeting back on track.
Miller said he was losing track of all the things he wanted to respond to. He said, “I’m well aware of our purpose for being here today. Thank you for pointing that out. Last night [at the regular FBCC meeting] I heard the words ‘fear mongering.’ That’s exactly what I’m hearing right here from you [referencing commissioners]. All of you are saying it’s a slippery slope. You start with that, and the mills filled this room because they were afraid of what was going to happen to them. … No one said anything about the mills. …”
City Manager Joe Gerrity broke in saying, “This is not an agendaed item. I don’t mean to interrupt you.” Other commissioners agreed with Gerrity and the meeting ended.