$33 Million Dollar Offer, ALL CASH, on the Table for OLF-8

The county has the opportunity to realize a nearly $20 Million Dollar profit if a deal that has been put forward for the purchase of OLF-8 is approved by the board of county commissioners and actually closes.  

The board has received an offer to negotiate / letter of intent for the purchase of the entire OLF-8 property from Escambia County for $33 Million Dollars Cash.

The offer letter was distributed to me an my counterparts this morning.

from the letter:

"The general terms and conditions upon which Purchaser proposes to purchase “The Property” are as follows:

1.                   Purchase Price. The Purchase Price shall be $33,000,000.00 at a single closing. 

2.                   Terms. The Purchase Price will be paid in cash at closing.

3.                   Earnest Money. Within Thirty (30) days after effective date of the Definitive Agreement, Purchaser shall deposit Earnest Money in the amount of One Million Dollars ($1,000,000.00) into an escrow account. A portion(s) of the earnest money will become non-refundable during the Inspection Period based on predetermined milestone(s) established during the negotiation and execution of the Definitive Agreement."

The agreement goes on to state the following:

"....Purchaser recognizes that Escambia County intends to utilize funds from the Triumph Grant for certain improvements associated with the OLF-8 project. Purchaser intends to cooperate with Escambia County in meeting the requirements contained in Grant Award Agreement.  From and after the execution of this letter, Seller agrees to negotiate exclusively with Purchaser and to refrain from offering or negotiating with any other party for the sale, lease or other disposal of the Property directly or indirectly from the date hereof until the earlier of the closing of the sale or the termination of this letter of intent or the Definitive Agreement. Seller shall not solicit, initiate, pursue, entertain offers, or otherwise consider or accept any other offers with respect to the Property or enter into any contract of sale, lease or similar agreement with respect thereto pending the earlier of the closing of the sale or the termination of this letter of intent or the Definitive Agreement."

Lots to unpack with this offer in hand, lots to consider.  This buyer is a huge national nameed company with significant financial resources.  If the deal were to be made, the county would be clearing nearly $20 Million dollars over and above the costs of acquiring OLF 8 -- which would be a tremendous win for the county and the taxpayers.  $20 Million buys a LOT of badly needed infrastructure.  Lots of it.

We have 10 days to answer this initial letter.

Much more to come on this later in the week....

Development Fees---or Sales Tax Surcharge? Or Both?

 I will be discussing bringing back concurrency to the BCC's Land Development Code at our next committee of the whole meeting.  There have now been several articles in the news about this, including this one from the PNJ today which discusses the new state law limiting impact fee year over year percentage increases, as well as Santa Rosa's challenges to implementing Impact Fees there.  The last couple of paragraphs capture some of my thoughts on these fees and how I envision them working here in Escambia County.

I do not support impact fees--I support concurrency as an alternative to them.  

Concurrency is smarter, more targeted, and I believe an overall better solution.

Now, developers and homebuilders do not like any form of impact fees, nor do they like concurrency.

One of the arguments against ANY additional concurrency or impact fees being levied on Escambia County builders that I have heard a lot is that "Escambia county already has the one-cent sales surtax" that can be used for infrastructure.  So why make the builders pay more?  Is the rhetorical follow-on question.

So, I looked statewide at how other counties handle this---especially the counties that also collect the discretionary sales tax like we do.   And a couple of interesting facts stand out.  

#1---99% of Florida Counties already collect some form of discretionary sales tax like our 1 penny LOST....99%!! or 66 of 67 counties. (Citrus County is the lone county in Florida that does not collect local option sales taxes on purchases----yet ironically they DO collect impact fees on developments...)

#2---of the counties that already collect a local option sales tax----a full 57% ALSO collect Impact fees to help pay for the costs of growth and infrastructure the growth demands.

So the argument that we already have LOST and therefore we don't need any other funds to offset infrastructure challenges of growth simply does not hold water.  That argument is not persuasive.  See the breakdown, below.

About Commissioners' Discretionary Funds: Part II--Local Option Sales Tax (LOST) Discretionary Funds

The utilization of district discretionary LOST funds allows individual commissioners in their respective districts to identify, fund,  and implement good and necessary projects--like the ones I am intending to bring forward for funding from this source, listed below. 

Some folks have recently asked me about Commissioners' discretionary funds.  People want to know where these funds come from, what they can be used for, and if the use of such funds is actually legitimate and legal?

So here goes....

Before I was elected to the board in 2016, the board had a pot of discretionary funds from the Tourist Development Tax  (TDT) that was split out among the commissioners yearly in increments of $50,000.00 per commissioner, with unutilized amounts rolling forward if not expended.  These funds, at that time,  had the caveat that they could only be used for event sponsorships or activities that would bring in tourist dollars from out of the area and generate hotel room nights in the county.

By the time I took my seat in November of 2016, this practice of TDT discretionary allocations had been ended by the commissioners and replaced with a yearly allocation of $50,000.00 in general fund monies that could be utilized by commissioners to fund local non-profit entities that support the community and serve a public purpose.  The uses for these new allocations were much more broad than were the previous monies that were mandated to be "tourism-centric."

From the time I have been on the board, the process of vetting organizations and funding them from discretionary allocations has run very smoothly--until recently when there was a bit of ill-placed consternation displayed about the practice.... But that incident was simply and succinctly squelched via a 4-1 affirmational vote....

The larger and much more profound pot of discretionary funds yearly for commissioners is our Local Option Sales Tax (LOST) discretionary pot of money.  Each year each commissioner gets an allocation of $1 Million Dollars in LOST funds for use as each commissioner sees fit within his district--subject to the statutory provisions guiding the use of these funds and subject to an affirmative vote of the full board of county commissioners (which is the check and balance of this process).  The unexpended balances of these funds carry over yearly.

The Local Option Sales Tax is a one penny tax on most consumer purchases made in Escambia County.  It's implementation was graciously allowed for by our county's voters who have been generous in permitting us to levy this tax since the early 1990s.  (Other local counties have struggled to implement their LOST tax--with voters rejecting this concept in other nearby communities over and over....)

Locally, our LOST produces about $42 Million yearly--a portion of which is shared with the county's two municipalities,  Pensacola and Century.  The balance of the funding yearly is used locally to purchase property, renovations, maintenance services,  buildings, ambulances, fire trucks, sheriff's equipment and vehicles, computer hardware, and a host of other things--but primarily capital expenditures or durable equipment that lasts 5-years or longer.  A portion of the LOST funds assists

Escambia County's Local Option Sales Tax (LOST) Has Been Invaluable for Citizens Over the Years

Nobody Likes Taxes---But with a Local Option Sales Tax in place---EVERYONE pays some--including tourists and folks that don't work.  Without LOST--a county's burden for facilities and infrastructure falls nearly exclusively on the collective backs of property tax payers.....

Lots of folks have been asking my opinion about the upcoming referendum in Santa Rosa County to go to a penny Local Option Sales Tax as Escambia County has done for the last 27 years.

I was asked to give my opinion, which I did when I spoke in a commercial for the folks that are backing the penny.  In the commercial I discussed some of the ways this tax has been beneficial to Escambia County over the years.

Obviously, though, this is a vote and a decision that belongs exclusively to the citizens of Santa Rosa County.  And they will decide this question next Tuesday in a special election.

But as it relates to my experience--I can tell you unequivocally--Escambia County's Local Option Sales Tax (LOST) has been invaluable for Citizens here over the years.

Escambia County's LOST has been maintained by the electorate since 1992 as follows:

LOST I                    June 1, 1992 (for 7 years per ordinance)

LOST II                  May 13, 1997 - May 31, 2007 (per ordinance)

LOST III                 June 1, 2007 - December 31, 2017 (per ordinance)

LOST IV                January 1, 2018 to December 31, 2028

According to staff with whom I have spoken--the total revenue generated over these years amounts to a massive figure:  $1,057,564,174.00 total including LOST IV's revenue in 2019 YTD.  So this equates to an average of $39 Million Dollars yearly over this period that Escambia County has utilized to modernize our facilities, parks, and infrastructure.  We have also utilized this revenue to purchase facilities and equipment, vehicles, and other items for the Sheriff's Department.  Escambia County Fire Rescue has also had fire facilities and equipment purchased with this revenue.  Because we had this revenue, we have also had the financial resources to lure huge companies to our County with economic development incentives--notably Navy Federal Credit Union and ST Engineering Aerospace.

The School Board in Escambia County (of which I was a member for 10 years) also had their own 1/2 penny LOST--which was used to build entire schools and finance the purchases of modern School Bus Fleets and tremendous numbers of renovations and upgrades at 57 school campuses county-wide.  When I was a school board member--I often wondered where our schools would have been, from a facilities perspective, without this revenue source.....Answer:  We would have been in DIRE STRAITS.

So no one knows for certain how Santa Rosa County will vote on this--again it is up to the voters and we will all see on Tuesday which way it goes over there.  For my part, I ALWAYS loved the fact that the sales tax method reduced the burden on property tax payers, it put everyone into the mix by taxing purchases by everyone (including tourists and folks that do not own property or work but who are nevertheless hyper-consumers of alcohol, tobacco, bling, iPhones, and other products upon which this tax is levied.)  In short, it forces everyone to put "skin in the game".

It has been excellent for Escambia.

We shall see if Santa Rosa property owners see this and vote appropriately on Tuesday--it will be in their interest to do so, in my opinion

NW District 1 Master Plan: The 50,000 Foot Level First

The Northwest portion of D1 (above) is growing rapidly.  I will soon recommend and request that a portion of my discretionary D1 LOST funding be utilized to develop a Master Plan for this entire area.  This plan will incorporate citizen-input and it will be designed to mesh with whatever is planned for the yet-to-be developed OLF 8 property.

As we in North West District 1 move closer and closer to establishing a committee to address the rapid growth of our area, one of the first things I will ask this committee to look at (once they are confirmed by the full BCC) is a Master Plan for the entire NW District 1 area (precincts 43, 5, and 68--depicted in the map above).

This entire area is growing rapidly--and as the growth occurs, there will be growing pains.  There will be great things and great businesses opening up that make our lives in this area better and create jobs for our citizens--but there will also be familiar problems (traffic-drainage) that will make this growth more challenging.

This is why I believe a committee is important going forward.

With respect to the master plan-I know there has already been significant work done by a group of individuals in this area, and I appreciate these efforts and I will not let these previous efforts go to waste;  I believe the previous work will be combined with new work to create a plan that meshes with the needs of the entire area while simultaneously addressing the challenges that the growth of the area has presented and may present in the future. 

I have set aside money from my discretionary LOST funding for D1 to pay for this NW District 1 Master Plan--- and as it pertains to OLF 8 and the development that ultimately occurs at that site once we acquire that site-- the ultimate objective for the NW D1 Master Plan will be for it to mesh with whatever is developed at OLF 8.  This will be accomplished by having the planner make multiple assumptions for what the development at OLF 8 may eventually become (Commerce park, Commerce Park with Mixed Use Retail along the frontage,  Mixed-use retail/residential, Open

Where Have the LOST Monies Been Spent? A 10 Year Look

I requested the information on behalf of a constituent and received the following chart back from staff.  It is interesting to look at the breakdown;  District 1 trails only District 4 as the district that has received the least amount of LOST funding over the last 10 years so far as I can tell.....