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1994.09.20_TC_Minutes_Special!. TOWN OF HIGHLAND BEACH, FLORIDA Minutes of Meeting of the Town Commission PUBLIC HEARING/SPECIAL MEETING Tuesdav, September 20, 1994 5:01 p m Mayor Arlin Voress called the advertised Public Hearing/Special Meeting of the Town Commission of the town of Highland Beach, Florida, to order at 5:01 p.m. in the Town Hall Commission Chambers. Others present were vice Mayor Bill Paul, Commissioners Arthur Eypel, John F. Rand, and David Augenstein. Also in attendance were Town Attorney Thomas E. Sliney, Town Manager Mary Ann Mariano, Town Clerk Anne M. Kowals, CMC, Finance Director Michael Seaman, and members of the general public. Mayor Voress noted the purpose of this advertised Public Hearing/ Special Meeting was to consider the adoption of the 1994/95 fiscal year budget, receive citizen's in-put, review that information, and adopt the applicable ordinances regarding the tax levy and appro- priating funds. At this time, Town Manager Mariano requested, and the Commission agreed, to add the following items to the end of today's Agenda: 1. The retention of Nicoletti Block Duffy Poncy & Kohn, P.A., regarding the Travelers Insurance Company Group Health Insurance Matter; and, 2. The retention of Attorney E. Barrett Prettyman with regard to the RTC matter. • Mayor Vorees, having explained how this Public Hearing/Special Meeting will be conducted, called on the Town Manager for back- ground information regarding the proposed 1994/95 fiscal year budget. Town Manager Mariano, in an effort to clarify matters, explained that the rolled-back rate is the millage rate which produces same tax dollars as last year, based on this year's assessments. Although the rolled-back rate is in reality less than last year's millage, the State requires us to use the percent of difference between that rate and our proposed rate for advertising purposes, thus the figure is 25.1% which is misleading in view of the fact that a resident's tax bill in Highland Beach overall is only increasing 3.9%. At this time, the Town Manager read into the minutes a statement, a copy of which is attached to and made a part of these minutes, requesting the Commission favorably consider the proposed 1994/95 fiscal year budget as recommended by the Financial Advisory Board. Town Commission Public Hearing/Special Meeting Minutes • September 20, 1994 Page 2 of 4 Mayor Voress, at the conclusion of the Town Manager's statement, requested public comments. The following residents presented their comments regarding the proposed 1994/95 fiscal year budget to the Town Commission: Mike Browner - 4740 S. Ocean Boulevard Michael Hill - 4408 B S. Ocean Boulevard Harvey Fenster - 3300 S. Ocean Boulevard Gloria Tannenbaum - 3212 S. Ocean Boulevard Victor Hadeed - 3201 S. Ocean Boulevard Steve Bruckner - 4205 Intracoastal Drive Jim Kelly - 2565 S. Ocean Boulevard Leonard Bell - 2727 S. Ocean Boulevard Andrej Martinovic - 4203 Tranquility Drive Al Bresnahan - 3310 S. Ocean Boulevard Jose Echeverria - 1112 Russell Drive Bill Rothenberg - 3009 S. Ocean Boulevard John Bury - 3224 S. Ocean Boulevard Anna Roy - 4301 Tranquility Drive Phyllis Shaffer - 3912 S. Ocean Boulevard Paul Kane, Sr. - 4505 S. Ocean Boulevard • As directed by the Mayor, the Town Clerk read, in entirety, each of the following ordinances: 1. AN ORDINANCE OF THE TOWN OF HIGHLAND BEACH, FLORIDA, TO EFFECT A TAX LEVY BASED UPON THE 1994 TAX ROLL OF THE TOWN OF HIGHLAND BEACH. 2. AN ORDINANCE OF THE TOWN OF HIGHLAND BEACH, FLORIDA, APPROPRIATING FUNDS FOR THE FISCAL YEAR 1994/95, BEGINNING OCTOBER 1, 1994, AND ENDING SEPTEMBER 30, 1995. Mayor Voress noted now is the time for the Commissioners to speak their piece relative to the budget ordinances. Commissioner John F. Rand noted if ever he was given credit for anything, it would appear his opposition to this tax increase has resulted in one of the largest turnouts of so many residents at this meeting. The Commissioner, alluding to his support of the Town Manager, explained his opposition to this proposed budget which includes a legal contingency fund is due to the fact that it is his opinion the Town will not be faced with such an expenditure this fiscal year and therefore an increase in the millage rate is not justified at this time. Commissioner Rand reiterated that he does not agree with the $367,000 reserve being proposed in this budget. • Town Commission Public Hearing/Special Meeting Minutes September 20, 1994 Page 3 of 4 Commissioner David Augenstein stated he is opposed to the proposed tax increase for the very same reason expressed by his colleague, Commissioner Rand. Commissioner Arthur Eypel, citing millage rates of similar munici- palities in Palm Beach County, noted three of the seven communities with a lower millage than ours provide no public safety or utility services to their residents. Noting the Commission is being asked to support a sound fiscal policy, Commissioner Eypel stated he will consider the best interest of the Town and its residents when he casts his vote on the proposed budget. Vice Mayor Bill Paul, alluding to the Town's litigation with Delray regarding the sewer and water issue which resulted in a surcharge being included on the utility bills, stated he is very much in favor of whatever contingency may be necessary to prepare the Town for any emergencies that may surface in the future. Mayor Arlin Voress extended thanks to the Town Manager, Town residents who presented their comments at this meeting, and the Commissioners who voiced their opinions regarding the proposed • budget. The Mayor noted the Town, in its attempt to obtain some degree of relief with regard to the RTC judgment, is faced with payment of legal costs. Having reviewed Meeting Minutes, audio tapes of the budget process, and discussing the matter with the individual FAB Members who reaffirmed their original stand, the Mayor stated he will vote his conscience on the issue by voting in favor of the budget. At this point, VICE MAYOR PAUL/COMMISSIONER EYPEL presented a MOTION to adopt Ordinance No. 641 to effect a tax levy based upon the 1994 tax roll of the Town. The MOTION carried with three "AYE" votes. A roll call resulted in "AYE" votes cast by Commissioner Eypel, Vice Mayor Paul, and Mayor Voress. "NO" votes were cast by Commissioner Rand, and Commissioner Augenstein. A MOTION by VICE MAYOR PAUL/COMMISSIONER EYPEL to adopt Ordinance No. 642 appropriating funds for the fiscal year 1994-95, beginning October 1, 1994 and ending September 30, 1995, carried with three °AYE" votes. A roll call resulted in "AYE" votes cast by Vice Mayor Paul, Commissioner Eypel, and Mayor Voress. "NO" votes were cast by Commissioner Augenstein and Commissioner Rand. • Town Commission Public Hearing/Special Meeting Minutes September 20, 1994 Page 4 of 4 The Commission, at this time, considered the retention of Attorney E. Barrett Prettyman to represent the Town with regard to the RTC matter at the Supreme Court level or wherever he deemed necessary. A MOTION by COMMISSIONER AUGENSTEIN/COMMISSIONER EYPEL to retain Attorney E. Barrett Prettyman in the RTC matter as requested per the Town Manager's Memorandum of September 19, 1994, received unanimous approval from the Members of the Town Commission. At this time, a MOTION by VICE MAYOR PAUL/COMMISSIONER EYPEL to authorize the retention of Nicoletti Block Duffy Poncy & Kohn, P.A. in regard to the Travelers Insurance Company Group Health Insurance Matter was unanimously approved by the Town Commission. Town Manager Mariano thanked the Commission for their consideration of the 1994/95 fiscal year budget. There being no further business to come before the Town Commission at this time, Mayor Voress, upon MOTION by VICE MAYOR PAUL/COMMIS- SIONER AUGENSTEIN, adjourned the Public Hearing/Special Meeting at 7:15 p.m. APPROVED : ~ 6°°~' ~ c~-----"~,--~ Arlin Vgress, Mayor Bi,~~Pa~l, Vic~Mayor Arthur EypelYCa~fi~ssioner . Ran Commi sione ~ _~\ ~ David Augens ei Commissioner A ~~ -~~ ,~ Date : Gov • ~ AMK • I AM HERE TODAY TO ASK FOR YOUR CONSIDERATION OF THE PROPOSED 1994/95 FISCAL YEAR BUDGET. THIS BUDGET CALLS FOR AN INCREASE OF .6502 MILLS OVER LAST YEAR'S BUDGET FOR THE PURPOSE OF THE GENERAL OPERATION OF THE TOWN AS WELL AS PROVIDING FOR SOME ANTICIPATED LEGAL EXPENSES IN CONNECTION WITH THE TOWN'S PURSUIT OF JUSTICE IN THE PENDING RTC MATTER. BEFORE ENTERING INTO A DISCUSSION REGARDING THIS BUDGET PARTICULARLY, I FEEL IT IMPERATIVE THAT MY MANAGEMENT PHILOSOPHY WHICH I DRAW ON IN PREPARING ANY BUDGET BE RESTATED FOR THE BENEFIT OF BOTH THE TOWN COMMISSION AND THE GENERAL PUBLIC. SPECIFICALLY, THERE HAS BEEN MUCH DISCUSSION THIS YEAR WITH REGARD TO THE RESERVES OF THE TOWN. SINCE 1988, MY WRITTEN MANAGERIAL PHILOPSOPHY AS TO THE ADMINIS- • TRATION OF THE TOWN BUDGETS, HAS BEEN TO STRIVE TO CREATE A RESERVE FUND EQUAL TO THE ANNUAL AMOUNT OF EACH INDIVIDUAL BUDGET, BEING THE GENERAL OPERATING BUDGET AND THE ENTERPRISE BUDGETS WHICH INCLUDE THE WATERANDSEWER BUDGETS. THIS PHILOSOPHY IS NOT NEW, AND IN FACT WAS STRENGHTENED POST HURRICANE ANDREW WHEN THE CITY OF HOMESTEAD WAITED 12-18 MONTHS FOR SOME OF ITS INSURANCE MONEY AND IS STILL WAITING FOR SOME FEDERAL REIMBURSEMENT OF COSTS. THE OPERATION OF GOVERNMENT MUST GO ON, EVEN IN TIMES OF CRISIS, AND IT IS MY JOB TO PLAN THE BEST WAY 1 KNOW HOW, TO ASSURE THAT THE TOWN CONTINUE THROUGH ANY GIVEN CATASTROPHY OR COLLAPSE OF ANY INFRASTRUCTURE. THROUGH THE ASSISTANCE OF THE FINANCIAL ADVISORY BOARD AND THE TOWN • COMMISSION, WE HAVE ACHIEVED THAT GOAL WITH REGARD TO OUR ENTERPRISE BUDGETS AND PROTECTION OF OUR WATER AND SEWER ASSETS. WE DO, • HOWEVER, FALL VERY SHORT OF THIS GOAL WITH REGARD TO OUR GENERAL OPERATING BUDGET, AS YOU CAN SEE FROM THE CHART I HAVE PREPARED FOR YOUR INFORMATION. IN TWO OF THE PAST THREE YEARS, WE HAVE TAKEN APPROXIMATELY $600,000 OUT OF RESERVES TO OFFSET TAX INCREASES AND IN FACT, HAVE OPERATED UNDER A DEFICIT BUDGET, PRIMARILY DUE TO THE PAST INCREASES IN FIRE/RESCUE FEES WHICH AS YOU KNOW WE WERE SUCCESSFUL IN CONTROLLING FOR OUR RESIDENTS. I WOULD ALSO LIKE TO REMIND YOU THAT LAST YEAR, WE WERE IN A POSITION TO LOWER TAXES WITHOUT DRAWING ON RESERVES. WE CANNOT AND SHOULD NOT CONTINUE TO DEPEND ON RESERVES FOR THE OFFSETTING OF TAXES OR ELSE WE WILL FIND OURSELVES IN A POSITION SIMILAR TO THE CITY OF BOCA RATON WHO, ACCORDING TO THE RECENT GRACE • REPORT, WILL RUN OUT OF MONEY NEXT YEAR DUE TO SUCH BORROWING FROM RESERVES RATH ER THAN I NCREASI NG THEIR TAXES. I HAVE ALSO PREPARED A CHART TO EXPLAIN EXACTLY WHAT THIS PROPOSED INCREASE MEANS IN REAL DOLLARS. I FEEL THESE FACTS ARE IMPORTANT TO PREFACE MY REMARKS WITH REGARD TO THE PRESENT PROPOSAL BEFORE YOU TO REMIND YOU THAT MY RECOMMENDATIONS, NOR THOSE OF THE FINANCIAL ADVISORY BOARD APPOINTED BY THIS COMMISSION, ARE MADE WITHOUT SUBSTANTIAL DISCUSSION, FORETHOUGHT AND THE BEST INTERESTS OF THE RESIDENTS OF THE TOWN OF HIGHLAND BEACH IN MIND. WITH THAT, I WOULD LIKE TO ADDRESS THE PROPOSED BUDGET BEFORE YOU TODAY FOR CONSIDERATION AND PARTICULARLY THE ISSUE OF THE RECOMMENDED TAX INCREASE AND THE PURPOSES THEREFOR. OF THE 4 MILLS BEING REQUESTED, 3.7082 REPRESENTS • MILEAGE FOR GENERAL OPERATING PURPOSES AND .2918 FOR DEBT SERVICE WHICH IS AN AMOUNT NOT OPEN TO CHANGE. OF THE .6502 MIL INCREASE BEING REQUESTED, .5791 IS BEING REQUESTED TO FUND AN ACCOUNT WHICH HAS BEEN NAMED "LEGAL CONTINGENCY". THE REMAINING PORTION OF THE INCREASE IS SPECIFICALLY FOR INCREASE IN THE GENERAL OPERATING LINE ITEMS OF THE BUDGET. THERE HAS BEEN SUBSTANTIAL DISCUSSION, NEWS MEDIA COVERAGE, AND SPECULATION AS TO THE REASONING BEHIND THE "LEGAL CONTINGENCY" LINE ITEM. AS LATE AS THIS MORNING, THE SUN SENTINEL REPORTED THAT THIS CONTINGENCY WOULD BE USED IN CASE THE TOWN LOSES ITS APPEAL OF THE HIDDEN HARBOR ZONING CASE. THEY GO ON TO SAY THAT THIS AMOUNT COULD BE USED TO PAY THE UP FRONT COSTS OF ISSUING BONDS TO PAY OFF • THE COURT JUDGEMENT. WITHOUT MEANING TO DEMEAN THE NEWS MEDIA, AGAIN THEY ARE WRONG. ANYONE WHO WOULD GIVE THIS ISSUE THE THOUGH IT DESERVES, AND I CAN ASSURE YOU THAT I AS WELL AS THE FINANCIAL ADVISORY BOARD DID, WILL TELL YOU THAT THE AMOUNT PROPOSED WILL NOT GO FAR SHOULD THE TOWN ULTIMATELY LOSE THIS CASE, AND FURTHER, WE ALL KNOW THAT BONDING COSTS CAN BE ROLLED INTO A BOND ISSUE WITHOUT UP FRONT COSTS. THIS RECOMMENDATION DOES NOT COME LIGHTLY OR OUT OF A WHIM. I HAVE DISCUSSED THIS ISSUE FOR SEVERAL YEARS WITH THE MEMBERS OF THE FINANCIAL ADVISORY BOARD DURING OUR BUDGET DELIBERATIONS AND TOGETHER, WE HAVE FELT THAT UP UNTIL NOW, THERE WAS NO NEED TO BUDGET A SPECIFIC SUM FOR ANTICIPATED LEGAL EXPENSES. THIS YEAR WE FELT THAT DUE '. , TO THE PRESENT POSITION OF THE TOWN AND TO ALLOW THE TOWN • COMMISSION TO CONTINUE ITS PURSUIT OF EVERY LEGAL REMEDY TO MINIMIZE THE OUTCOME OF THIS LITIGATION, IT WAS TIME. 1 KNOW THAT THE TALK ON THE STREET AND THE NEWS MEDIA WOULD LIKE TO THINK THAT THIS CASE IS OVER AND THE PAYMENT OF ALMOST $18 MILLION DOLLARS IS A FEAT OF COMPLE, HOWEVER, I CAN ASSURE YOU THAT THIS IS NOT THE CASE AND THAT THIS COMMISSION IS DOING EVERYTHING WITHIN ITS POWER, INCLUDING PROVIDING THE BEST DEFENSE IT CAN, TO OVERTURN A LUDICROUS, UNJUST JUDGMENT AGAINST THE TOWN. THIS TAKES MONEY. CERTAINLY WITH $18 MILLION DOLLARS AT STAKE, THE RESIDENTS SHOULD EXPECT THEIR ELECTED OFFICIALS TO EXHAUST EVERY REMEDY AVAILABLE BASED ON THOSE WHO ARE EXPERT IN THEIR FIELDS AND THE PROBABILITY OF MINIMIZING THE FINANCIAL LOSS TO THE TOWN. THE RESIDENTS SHOULD EXPECT NO LESS. THE QUESTION THEN ARISES AS TO WHERE THIS MONEY COMES FROM. CERTAINLY THERE ARE THOSE WHO FEEL THAT THE TOWN SHOULD TAKE THE MONEY OUT OF ITS RESERVES TO PURSUE A FAVORABLE RESOLUTION TO THIS ISSUE AND THAT IS ONE WAY TO LOOK AT IT. THEN THERE IS THE BIG PICTURE. DO OUR RESIDENTS DESERVE TO SPEND THEIR TAX RESERVES ON THIS ITEM AND THEREBY JEOPARDIZE THE SECURITY OF KNOWING THEIR SERVICES ARE PROTECTED IN CASE OF ANY NATURAL DISASTER OR OTHER MISHAP. AND WHAT IF WE DON'T SPEND THIS MONEY WE HAVE COLLECTED TAX DOLLARS ON, WHAT THEN WELL I CAN TELL YOU THAT WE WILL HAVE TO SPEND SOME OF THE MONEY ALLOCATED AND THAT WHICH IS NOT SPENT WILL REVERT BACK INTO OUR RESERVE, WHICH HAS BEEN BORROWED FROM IN THE PAST TO ASSIST IN .~ .~ a ACHEIVING THE GOAL OF THIS MANAGER IN THE FIRST PLACE. CERTAINLY, THE • IMPACT TO OUR RESIDENTS HAS BEEN CAREFULLY SCRUTINIZED PRIOR TO THIS RECOMMENDATION BEING MADE AND I CAN TELL YOU THAT THIS AVENUE CAN BE TAKEN WITH THE TOWN OF HIGHLAND BEACH'S MUNICIPAL TAX RATE BEING IN THE LOWEST 9% OF THE COUNTY OUT OF 37 CITIES COUNTYWIDE. I THINK THAT THIS IS AN ADMIRABLE SITUATION TO BE IN AND WOULD ASK THAT YOUR FAVORABLE CONSIDERATION BE GIVEN TO THE JOINT RECOMMENDATION OF THIS MANAGER AND YOUR FINANCIAL ADVISORY BOARD TO ADOPT THE BUDGET AS PRESENTED.