Forward Fernandina, Part II: Status report, consequences and lessons learned

Submitted by Suanne Z. Thamm

Reporter-News Analyst

Suanne Z. Thamm Reporter-News Analyst
Suanne Z. Thamm
Reporter-News Analyst

This is the second part of a 3-part series on the Fernandina Beach strategic plan known as Forward Fernandina.  The first part, published on February 13, provided information on the background and genesis of the plan.

So where are we today?

The initial $1.883M required for Phase I of Forward Fernandina has been borrowed and is sitting in city accounts to fund the first phase of the projects identified under the Forward Fernandina plan.  Loan origination fees have been paid; franchise fees have gone to 60 cents per $100 of power used; the city is paying roughly $40K in interest on the loan.  Zev Cohen has done preliminary engineering and permitting work for infrastructure improvements on Front Street.

The city has voted to spend $600K as part of a tripartite agreement with Nassau County and the Friends of the Library to rehabilitate and expand the city building housing the library collections and functions on North 4th Street.  The city has also agreed to spend $125K of the amount to match money put up by the Tourism Development Council (TDC) to restore the Centre Street train depot.  [The Amelia Island Fernandina Restoration Foundation is also contributing $50K to the total project.]  Approximately $1M of the loan has not been specifically committed or spent to date.

  • One current commissioner, Pat Gass, believes that all the loaned money should be returned to save interest payments.  While she is not necessarily opposed to any of the projects per se, she believes that the great majority of the voters want the money returned and want to vote on any projects of this sort in the future, whether required by law or not.
  •  Another commissioner, Vice Mayor Charlie Corbett, would honor commitments, including the depot and the library, but would return the unspent and uncommitted million dollars.
  • Mayor Sarah Pelican has stated that she believes that the city has enough balls in the air at this time and that since most of the problems with city buildings like the library and the train depot have resulted from lack of maintenance, attention should be focused on creating a maintenance plan, not taking on more work.
  • Newly elected Commissioner Ed Boner wants the commission to come together on a list of projects for which they would agree to spend the borrowed money that is not yet committed.  He does not apparently think it wise to return the money at this time.
  • Commissioner Filkoff, the last remaining commissioner from the group that approved the Forward Fernandina strategic plan, wants it to go forward in its present shape, recognizing that many projects on the list can only come to final fruition when the economic development done by the private sector kicks in.
  • City Manager Joe Gerrity is taking a hands-off position with respect to weighing in on any side, publicly stating that decisions must come out of discussions by the commissioners.

PrintConsequences

Failure to honor commitments made to Nassau County, the Friends of the Library, the Tourism Development Council and the Restoration Foundation is bad faith at this point and would have serious repercussions for any future joint endeavors.  Likewise, returning borrowed money when there are so many needs downtown seems penny-wise and pound-foolish.  Franchise fees, a non-tax revenue stream, is being used to repay the low interest loan.  Would those same commissioners who talk about “giving the money back” also roll back franchise fees?  Or would they simply pump up the general fund with those revenues, thereby violating the public trust, since the increases were based upon specific capital improvements?

The commission originally developed the Forward Fernandina plan to accomplish two primary objectives:  broaden the tax base and encourage economic development in the historic downtown business district.  While the city definitely has additional needs, would fulfilling those needs with loan proceeds further these two goals?  One possibility mentioned has been reprogramming the money to fund a new Humane Society animal shelter.  Since the Humane Society has not yet raised its share of the match, such consideration seems premature.  Also, while no one can argue that a new shelter is in the interests of the community, would it really promote economic development or broaden the tax base?  Adding bathrooms to the MLK Recreation Center has also been mentioned as a necessary capital improvement.  Does it make sense to spend upwards of $50K to add bathrooms to an underutilized city facility?  Replacing sewers in Old Town has also been identified as another possible use for the loan proceeds.  But is it necessary to use this funding source for that project rather than merely adjusting priorities within the current Utility Department budget?

If the city returns all or some of the Forward Fernandina loan, it will have wasted more than the loan origination fee and interest paid to date.  It will have wasted the work done and paid for with respect to Front Street infrastructure engineering and permitting.  It will have wasted staff efforts and those of citizens who, at least since the 1990’s, have volunteered their time and talents serving on myriad city committees to identify goals and projects to improve city life for residents, businesses and visitors.  In short, it will have once more set the stage for Groundhog Day and the usual circular firing squads that cause much turmoil but produce little of lasting significance.

Lessons learned

Can we draw any lessons from the Forward Fernandina debacle to help future commissions avoid similar pitfalls?  Perhaps.  These are some of the lessons that we should keep in mind before launching any big project:

  • People cannot support projects they do not understand.  While the prime movers in the Forward Fernandina plan had clearly identified goals and objectives, the average citizen was clueless.  Whether by design or happenstance, people did not attend meetings held to discuss the plan.  Therefore, when it was adopted, many reacted with outrage.
  • The city has a responsibility to communicate clearly, often and via many different means over an extended period of time to insure adequate public input on important matters.  Failure to do so causes people to question the need for action and the motives of those proposing the action.
  • The city also has a responsibility to thoroughly brief new commissioners on the status of all major projects underway when the new commissioners take office.  Information needs to be provided in a clear, straightforward manner that meets the need of the commissioner.  It is not enough for staff to brief commissioners in language staff understands.  Reports and facts need to be presented in a manner that the average citizen, without a degree in economics, law or planning, can understand.
  • The city must likewise develop regular, honest communications with local media if media is expected to disseminate accurate information to the public.
  • There is a difference between effective government and efficient government.  In the best of worlds these two are one in the same.  But while we may live in a wonderful place, we are not in the best of these worlds.  Efficiency may be achieved for example through automation, voice mail, and streamlining operations.  Effectiveness, however, is not as easily achieved.  Real people don’t care that voice mail saves time, if they feel the need to speak to a person.  Real people may need several meetings over many months either to grasp a complex subject or come to understand how it will affect them.  Real people have concerns and fears about change.  An effective government will recognize its need to take the time and effort to convince people of the rightness of their proposed action.  This may mean the loss of opportunities, higher interest rates, and many more meetings.  But as we invest money in our capital projects we must also invest time and education in the electorate.

But not all the lessons learned reveal points of pride for our city.   For example:

  • People who vote are not necessarily the people who serve on city committees, attend city commission meetings or make an effort to keep informed about city business.  Complaining is much easier than taking personal responsibility for keeping informed.
  • Many citizens view the commissioner as a tool to advance a personal agenda, rather than part of a leadership team to advance larger city interests. 
  • Many in this community poorly understand the concept of representative government.  Not every decision needs to be made by The People via referendum.  If that were the case, there would be no need for the City Commission.
  • Idealistic goals tend to go by the wayside once price tags appear for any city project, whether it is a matter of maintenance or a new initiative.  In short, money in people’s pockets is more important than civic improvements.
  • Despite the fact that our city begins each regular meeting with a prayer, behind-the-scenes machinations, character assassination and rumormongering seem to regularly substitute for reasoned public discourse when differences of opinion emerge on public issues.

Hindsight is always 20-20.  Forward Fernandina could have been handled differently and possibly with better results.  Should we sacrifice the entire plan because it wasn’t done perfectly?  Or should we do what we can with what we have and live on to work better and smarter on future efforts of this type?  It will be up to the current Fernandina Beach City Commission to decide the future of Forward Fernandina.

Next installment:  Part III:  The ball is in YOUR court.

Editor’s Note:  Suanne Thamm is a native of Chautauqua County, NY, who moved to Fernandina Beach from Alexandria,VA, in 1994. As a long time city resident and city watcher, she provides interesting insight into the many issues impacting our city.  We are grateful for Suanne’s many contributions to the Fernandina Observer.

February 14, 2013 5:00 a.m.

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mike spino
mike spino (@guest_4013)
11 years ago

Lost in all this discussion of F2 and borrowing are some very basic principles of public finance. There are very good legal and economic reasons for using borrowed funds for major capital investments. There are also constitutional and moral limits on how borrowed funds may be used. For example, it is unconstitutional in the state of Florida to use borrowed capital funds for operating purposes such as reserves. And it is foolish to argue that the city should not borrow money to build or renovate libraries, animal shelters and water and sewer systems. If the city has enough money to make these kind of capital investments then we have been over taxed. Large capital projects should be debt financed so that the burden can be spread over taxpayers over the useful lives of the asset. To not borrow to make major renovations is like saying you can only buy a house if you can pay cash. Paying cash for major projects screws current taxpayers and benefits future ones. It is also foolish to argue that the city’s capital debt is contributing to the budget problem. The city’s issued debt is well within state law and consistent with public finance standards. So while the city’s operating budget is out of balance because of a 25% reduction in property taxes, it has nothing to do with the proposed capital projects. Unless of course you insist on foolishly paying cash for assets that will out live us all.