HomeMy WebLinkAboutMemo re: Resolution No. 2015-04 - Supplemental Info Memo
TO: Honorable Mayor and City Council
VIA: David L. Greene, City Manager
FROM: Todd Morley, Economic Development Director,and
David Dickey,Community Development Directort
DATE: September 8,2015
RE: Resolution No. 2015-04—Supplemental Information
At the September 8th City of Cape Canaveral CRA Board meeting, the Board will consider
Resolution No. 2015-04 authorizing an Interlocal Agreement between the City and the CRA
("Interlocal Agreement"). The Interlocal Agreement provides that the City will loan the CRA
funding for redevelopment within the CRA area. The Interlocal Agreement provides for a loan in
the amount of$470,000.
Pursuant to Florida Statutes,all taxing authorities have been notified prior to this meeting including
the Brevard County Board of County Commissioners. In response to receiving notice,the County
Commission discussed the Interlocal agreement at its September 1st meeting under the "New
Business" portion of the meeting. The Interlocal Agreement was presented on the agenda as,
"Acknowledge Receipt,Re: Interlocal Agreement Between City of Cape Canaveral and the Cape
Canaveral Community Redevelopment Agency." The County Commission held a lengthy
discussion on the issue. City staff was in attendance.
In summary,Brevard County Clerk of Court,Scott Ellis,Commissioners Infantini and Smith and a
few members of the audience spoke against CRAs in general,with Commissioner Smith saying:"I
would like to see CRAs go away." This appears to be something of a recent theme at Brevard
County meetings.Earlier this year Staff attended a Brevard County Budget Advisory Board meeting
where certain volunteer board members expressed similar anti-CRA sentiment.
Commissioner Infantini questioned whether lift station 6 was previously in the City's Capital
Improvement Plan(CIP), and Mr. Ellis stated that he believed the project was ineligible for CRA
funding,apparently based on Section 163.370(3)(B),Florida Statutes which states:
(3) The following projects may not be paid for or financed by increment revenues:
(b) Installation, construction, reconstruction, repair,or alteration of any publicly
owned capital improvements or projects if such projects or improvements were
scheduled to be installed, constructed, reconstructed, repaired, or altered within
3 years of the approval of the community redevelopment plan by the governing
body pursuant to a previously approved public capital improvement or project
schedule or plan of the governing body which approved the community
redevelopment plan unless and until such projects or improvements have been
removed from such schedule or plan of the governing body and 3 years have
elapsed since such removal or such projects or improvements were identified in
such schedule or plan to be funded, in whole or in part, with funds on deposit
within the community redevelopment trust fund.
In essence,this Section appears to prohibit a CRA from funding capital projects or improvements
that are stated in the CIP of the governing body that created the CRA unless the capital project or
improvement is removed from the CIP and at least 3 years lapse since such removal or the CIP
identifies the use of CRA funds for the project or improvements.
Rehabilitation of existing lift station 6 vs.Redevelopment of the area in the vicinity of Lift station 6
in order to promote economic development opportunities.
The FY 2014/15 CIP references the rehabilitation of several lift stations including lift station 6.
However,it is very important to note that the City abandoned the rehabilitation project for lift station
6 after evaluating the broader redevelopment and economic needs of the area in the vicinity of lift
station 6. The area in the vicinity of lift station 6 has tremendous long term
development/redevelopment potential especially given its proximity to Port Canaveral. However,
the area suffers from significant slum and blight and is in need of substantial redevelopment in order
to reach its potential.
In furtherance of this broader redevelopment and economic development objective,the City and the
CRA decided to pursue a development project which includes a much larger regional lift station to
support redevelopment of the area. The regional lift station project far exceeds the scope of the
rehabilitation project contained in the 201415 CIP because the two projects have substantially
different objectives. The regional project abandons the old lift station, installs a new,much larger
regional lift station and associated components/capacity in a location north of the old lift station,
adds several sewer manholes, extends water and sewer services approximately 1,000 feet and
includes several easement purchases.This regional lift station project associated with the proposed
loan never appeared in the City's CIP.
A simple comparison of the previously proposed rehabilitated lift station and the actual regional lift
station is as follows:
Item Rehabilitated LS6 Scope Regional LS6 Scope
Design Criteria 520 GPM 1190 GPM
Horsepower Two ea. 3H.P. One ea. 7.5H.P.&one ea. 10H.P.
Wet well depth 9.0 ft. 16.5 ft.
Generator No Yes
Manholes No Yes
Sewer line piping No Yes
Water line piping No Yes
Timing of CIP and new hotel.
As noted above,the regional lift station is part of a broader redevelopment project which is necessary
to remove slum and blight by bringing economic development opportunities to the area in the
vicinity of the lift station. This economic development initiative by the CRA and the City was
initiated as a result of the new Homewood Suites by Hilton Hotel which is currently under
construction at 9000 Astronaut Boulevard. Subsequent to adoption of the 2014/15 CIP, the City
determined that the previously proposed lift station 6 rehabilitation project would not be sufficient
to support the needs of the hotel project and the surrounding undeveloped area.
Understanding that the hotel represented a $20M investment in the City and in the CRA, it was
determined that a much larger redevelopment project would be required to support future
redevelopment and to attract other significant economic development opportunities to the area.
Generally,the new Regional Lift Station Project includes:
• Abandoning the existing lift station 6,
• Purchasing and expanding a lift station easement location to accommodate a larger lift
station 6,located north of the abandoned lift station,
• Purchasing easements across five parcels to reach the new hotel,
• Extending over 1000 feet of 8"sewer pipe north to the hotel,
• Installing over 1000 feet of water main pipe to the hotel,including fittings,wet tap and
valves,
• Installing seven new sewer manholes,and
• Constructing/installing a new, larger lift station, larger/deeper wet well, increased
horsepower pumps,associated components and a generator.
Utility infrastructure expansion is specifically authorized in the City's CRA plan because it is an
essential component of redevelopment Specifically,the CRA Plan states:
Public Improvements
The CRA will provide necessary public facilities at acceptable levels of service within the redevelopment
area to accommodate existing and future needs as proposed development occurs within the redevelopment
area including,but not limited to;
Partnerships to Improve Services and Facilities- The CRA will work with all appropriate government
and private utilities to ensure the provision of adequate public and utility services and facilities within the
redevelopment area including, but not limited to, transportation, electricity, telecommunications, cable
television,water,storm water,sanitary sewer,gas,parks and recreation,and solid waste.
Therefore,the regional project is consistent with the objectives of the CRA Plan.
Additional points.
We acknowledge that there is a small, but vocal faction in Brevard County Government that
is opposed to CRAs in general. It is important to note that:
1. Since Charter Government adoption,the County approved all CRAs located in Brevard,
2. This Project is consistent with the goals of the Cape Canaveral CRA, Economic
Opportunity Overlay District,Brownfield Area and Visioning document.
3. The loan does not violate the prohibition on funding CIP-identified expenditures.
4. County approval is not required for this loan. With the exception of future expansion of
the CRA boundary,the passage of Brevard County Resolution No. 2012-269 delegated all
powers to the City for the creation and operation of the CRA. Section 2 of said Resolution
lists the specific powers:
Pursuant to Sections 163.410 and 163.356, Florida Statutes, and subject to the
conditions set forth in Section 3, below, the Board hereby delegates all powers
under Part III, Chapter 163, Florida Statutes, to the City Council of the City of
Cape Canaveral, Florida, to create, operate, and maintain the City of Cape
Canaveral Community Redevelopment Agency within that portion of its
municipal boundaries that are within the boundaries set forth in Exhibit"A". Said
powers shall include but not to be limited to:
(u)The power to borrow money and to apply for and accept advances,loans,
grants, contributions, and any other form of financial assistance from the
Federal government,the state, county, city or other public body or from any
sources public or private for the purposes of Part III, Chapter 163, Florida
Statutes, and to give such security as may be required and to enter and carry
out contracts or agreements in connections therewith, and to include in any
contracts for financial assistance with the Federal government for or with
respect to community redevelopment and related activities such conditions
and powers pursuant to Federal law as Brevard County or the City deems
reasonable and appropriate which are not inconsistent with the purposes of
this Part III, Chapter 163,Florida Statutes.
Notwithstanding the foregoing, in the spirit of cooperation and a desire for a continued long-
term positive working relationship with Brevard County, Staff recommends the loan be
reduced to costs associated with the Regional Lift Station Project less costs which could be
construed to be attributed to the Rehabilitation Lift Station Project contained within the 2014-
15 CIP.
Methodology:
1. Itemize and tabulate all costs associated with the construction of the Regional Lift Station
6 Project.
2. Identify which costs (or pro-rated portions thereof) could reasonably be attributed to the
Rehabilitated Lift Station Project.
3. Deduct the total cost identified in step 2 from the Regional Lift Station 6 Project costs
tabulated in step 1.
The upgrade from a rehabilitated lift station to a regional lift station increases the design criteria
capacity from 520 GPM to 1190 GPM. Accordingly, the capacity of the rehabilitated lift
station would have been 44%of the capacity of the regional lift station(520/1190). Therefore,
the pro-ratable percentage of costs attributable to the wastewater utility fund is 44%. Note that
certain items, such as engineering fees, mobilization, etc., would be paid either way and are
not pro-rated.
LOAN SUMMARY AND ALLOCATION AMOUNTS BASED ON BID
Attributable Pro-rated? Attributable
Item to Regional to Rehabilitation
Description Project 44% Project
Land acquisition 83,100 N/A N/A
Engineering 82,000 No 82,000
Mobilization 6,000 No 6,000
General requirements, Bonds& Permits 32,800 Yes 14,432
Indemnification 1,000 No 1,000
Maintenance of Traffic 2,850 No 2,850
Testing Lab Services 4,000 Yes 1,760
Locate utilities 1,600 Yes 704
Layout and as-built survey 16,200 Yes 7,128
Start-Up and Training 2,100 No 2,100
Bypass Pumping 18,740 No 18,740
Lift Station No. 6 Improvements, Complete 230,329.50 Yes 101,344.98
8-inch PVC Sanitary Sewer Pipe 0-10 ft. 55,360 N/A N/A
8-inch PVC Sanitary Sewer Pipe 10-12 ft. 11,832 N/A N/A
Sanitary Sewer Manholes 75,600 N/A N/A
Water main Pipe & Fittings 60,372 N/A N/A
Wet Tap&Valve 6,700 N/A N/A
Gate Valves 7,000 N/A N/A
Asphalt Replacement 17,686 Yes 7,782
Demolition 42,400 No 42,400
Total 757,670 288,241
Total Regional Lift Station Project Cost(adjusted): $757,670
Less Rehabilitation Project/Wastewater utility fund portion: <$288,241>
Loan Amount: $469,429(round to$470,000)
Summary:
Providing utility infrastructure is an essential and fundamental economic development tool. It
lays the ground work for quality redevelopment and new development opportunities. It helps
to remove slum and blight. By statutory definition, 56%of the City of Cape Canaveral is in a
blighted/slum condition. The Interlocal Agreement is intended to support an important
infrastructure project that is located in the City's CRA,Economic Opportunity Overlay District
and Brownfield area. The Project is already supporting a $20 million dollar hotel project
currently under construction. The City anticipates once this Project is completed, additional
economic development opportunities will result consistent with the goals and objectives of the
CRA and Florida Statutes.
The Project and the Interlocal Agreement are consistent with Florida law, the Redevelopment
Plan, Community Visioning Effort and recent Branding Initiative. It maintains the City's
positive relationship with Brevard County and furthers the overall goals of the community to
support growth and quality development/redevelopment throughout the City.
cc:
Anthony Garganese,City Attorney
John DeLeo,Administrative/Financial Services Director
Angela Apperson, City Clerk
Joyce Muse,Public Works Services Director
Jeff Ratliff,Public Works Services Deputy Director
John Pekar,City Engineer