Poynter to Gerrity: Not so fast!

Submitted by

Suanne Z. Thamm

Reporter – News Analyst

The second FY2012-13 Fernandina Beach budget workshop on July 10, 2012, produced more bad news for a cash-strapped city. Tempers of the commissioners rose along with the heat index, often producing verbal fireworks that did not lead to consensus on cuts or revenue increases for the new fiscal year.

The meeting ended in a standoff between City Commissioner Tim Poynter and City Manager Joe Gerrity. Poynter refused to accept Gerrity’s proposed increase in millage to 5.86 (0.41 above the adjusted millage rate) without seeing evidence of the city manager’s having considered deeper spending cuts, especially with respect to the Recreation Department. The millage rate cannot be raised to 5.86 without a 4/5^ths vote of the commission. While other commissioners seemed resigned to initially setting the millage rate at this point, understanding that in subsequent meetings as new cuts are found the rate could be lowered, Poynter was not willing to go there.

Gerrity and Filkoff asked commissioners at the end of the meeting if they were willing to support Gerrity’s Option A calling for a millage increase rate to 5.86 as a starting point.  Commissioners Bunch and Corbett readily agreed.  Commissioner Pelican said that she had always maintained that she would only support a millage increase if public safety were threatened.  Poynter asked her if that was a yes.  With some reluctance she agreed.  Filkoff also agreed, but Poynter was adamant in his opposition without more work on reductions in expenditures.

Without Poynter’s support the proposal is dead in its tracks, since there will only be 4 commissioners attending the all-important August 2 meeting mandated by law to set the proposed millage rate. Commissioner Charlie Corbett has announced that he will be away for 3 weeks between July 18 and August 4, missing both any intervening budget workshops and the formal meeting on August 2.

Unless Poynter’s concerns can be addressed quickly, it appears that the city manager’s second option, which only requires 3 votes, will be adopted: an adjusted operating millage rate of 5.45. The lowered millage would mean that the entire amount needed for beach renourishment — $500,000 – would be deferred to FY 2013-14, as opposed to setting aside $250,000 in two annual installments.

What seemed to set Poynter on edge was a study produced by former Deputy City Manager Dave Lott that presented fully loaded costs of the city’s recreation programs. The city manager and the commissioners had just received the results of that study several hours preceding the budget workshop. Of the 37 programs offered, only 5 operated without net losses:  Nature Photo Class, Tennis, After School Camp/Daycare, Summer Camp Amelia and Aerobics. Net losses for other programs ran from a low of minus $92 for Karate to a high of minus $111,016 for special event support.

Speaking to the city’s recreation function, City Manager Gerrity said, “I believe the people desire a higher level of service.  My feeling is that recreational opportunities are one of the core services [the City of Fernandina Beach] provides.”  He added that the staff of the Recreation Department need to be especially nimble to cover all the activities the city offers.  All the programs are provided by a staff of 10 full time salaried people who work 55-60 hours per week, augmented by part-time seasonal workers.

While not disagreeing about the need for recreation programs, Poynter asked Gerrity, “Can we continue to support two recreation centers?” Gerrity responded, “That’s a decision for the City Commission.” Poynter instructed Gerrity to “delve into the Recreation Department.”  Vice Mayor Bunch added that it is an option to close a recreation center and consolidate programs. People could be bussed from the closed center to the one remaining open. He also asked if the city is hurting local small businesses by doing some of the things on the current activity list, like providing daycare.

Poynter told Gerrity that from his perspective, the city manager hasn’t done as good a job in reducing expenses and that he needs to make some harder decisions and bring those decisions back to the commission.  Gerrity said that he has only been on the job 6 weeks; both Commissioners Corbett and Pelican jumped in to defend Gerrity echoing his short tenure with the city.

Commissioners Pelican and Corbett also made a point of blaming “previous commissions” for “reckless spending, gutting reserves and kicking the can down the road” with respect to setting aside funds for a variety of problems ranging from beach renourishment to maintenance issues.  Poynter quickly jumped in to refute this, stating that if the commissioners last year had not supported a modest increase in the millage rate to cover a shortfall in tax revenues resulting from successful appeals of property evaluations, the city would be in even worse shape today. In what almost looked like an orchestrated move, Pelican began her critique, quickly followed by Corbett who popped up from his seat to produce a Ross Perot-like bar chart purporting to show growing city expenditures and declining reserves.

Corbett maintains that the city is using reserves to keep operations running.  [City Finance Director Patti Clifford, however, indicated outside the meeting that reserves remain at 25% of the general fund.]   Corbett, who seemed so agitated that his voice quivered at times, continued to criticize the borrowing for the Forward Fernandina (F2) projects, insisting that all the money not currently allocated or spent be returned. Despite repeated attempts to remind him that the costs of the F2 loan were borne by franchise fees, not millage, Corbett seemed to feel that they were related because they were both covered by the general fund. He expressed his continued opposition to opening the railroad crossing at Alachua Street. Mayor Filkoff and Commissioner Poynter tried in vain to explain that Corbett was mixing apples and oranges.

Mayor Filkoff turned to City Manager Gerrity to see if he agreed on the causes of the current budget problems. Gerrity reminded the commissioners that the current fiscal year began with more than a quarter million dollar shortfall, due to lower than anticipated revenues from ad valorem taxes. He agreed with Filkoff’s statement that the decline in property evaluations, the poor performance of the stock market and the low interest being paid on city investments were the culprits in the city’s revenue losses. Filkoff added that every community in Florida is facing the same problems, and that as long as the city remains so dependent on property tax revenues, the situation will not improve. She circled back to the need to diversity the city’s tax base, an effort that will be intensified through the city’s participation in Nassau Tomorrow, an initiative of the Nassau County Economic Development Board, which the Fernandina Beach City Commission agreed unanimously to support with a $25,000 from the Airport Fund earlier in the meeting. Vice Mayor Bunch pointed out, however, that benefits from this initiative would not be realized quickly.

City Manager Gerrity said that he was not happy about bringing to the City Commission his budget proposal calling for such an increase in the millage rate but that he believed he had cut as much as he could. He said, “Someone needs to pay for it [running the city].  We need to set politics aside and govern.  That means making difficult decisions.” He presented the Commission with 5 additional options to save money, none of which received consensus support:

• Close the pools at both recreation centers for a year ($120,000 savings)
• Adjust the deductible for Health Insurance for city employees with no increase in the monthly premium ($50,000 savings)
• Further reduce personnel, including Public Safety ($300K-500K savings)
• Eliminate the pension advisors ($50,000 savings)
• Eliminate Non-Profit contributions ($35,000)

The Commission did appear to support – or at least not reject at this time — Gerrity’s other recommendations, including:

• Renovating the Train Depot with $125K of the Forward Fernandina loan proceeds
• Increasing the electric franchise fee ($2.27 per $100 on individual electric bills) from 5.05% to 7.32%
• Deferring $250K for the Humane Society shelter
• Transferring $143,225 of the original seed money back to the General Fund from the CRA
• Maintaining a reserve level of 20% of the General Fund
• Using $175K of State Shared Revenue to maintain the General Fund Reserve

At one point in the meeting, Gerrity said, “I can cut more, but it will hurt us.”  Poynter responded that Gerrity’s proposal to increase the millage and the franchise fees “a whole lot” would also hurt a lot of citizens. Poynter said that such a move would definitely need to be sold to the community as being absolutely necessary, adding, “It takes money to live here.” Corbett added, apparently in jest, “If you can’t afford to live here, you can move.”  This was a tongue in cheek reference to an earlier statement Poynter had made that incurred much wrath in the community. This remark was one of the few moments of intentional levity during the 2-hour meeting, which was attended by about 25 people.

The City Commission minus Commissioner Corbett will meet again on July 24 at 5:05 p.m. in another budget workshop at which time City Manager Gerrity will present additional changes based upon commissioner input and/or further examination of the city’s needs.

Editor’s Comment:  Click on the link for a seven minute video of city commission budget workshop.  For Video of 7 minutes of the Budget workshop visit:

July 11, 2012

12:56 p.m.