[Call to Order]
[00:00:10]
>> WELCOME TO THE FORT PIERCE YOU TILLS AUTHORITY MEETING.
PLEASE STAND FOR THE PRAYER AND PLEDGE OF ALLEGIANCE.
>> GOOD AFTERNOON. LY READ A SCRIPTURE.
I SAY YEAH 60. ARISE, SHINE, FOR YOUR LIGHT HAS COME, AND THE GLORY OF THE LORD HAS RISEN UPON YOU.
WE ARE THANKFUL FOR YOUR GRACE AND MERCY THAT YOU CONTINUALLY POUR OUT ON US. WE THANK YOU THAT WE ARE KNOWN AS THE SUNRISE CITY. WE ACKNOWLEDGE THAT THIS IS THE TIME FOR FORT PIERCE TO TAKE HOLD OF ISAIAH 60 VERSE 1.
WE WILL ARISE AND SHINE FOR YOUR LIGHT HAS COME ON US.
WE THANK YOU FOR BRINGING YOUR LIGHT TO THE DARK PLACES OF FORT PIERCE. WE THANK YOU THAT PEOPLE FROM FAR AND WIDE ARE GOING TO BEGIN TO LOOK AT THE CITY OF FORT PIERCE TO HELP LEAD THE WAY IN MANY ARENAS.
WE ASK FOR YOUR GUIDANCE AS WE STEWARD THE THINGS THAT WE HAVE, MAY WE BE WISE WITH OUR RESOURCES.
LORD, WE ASK THAT YOU MULTIPLY THE BREAD AND WINE IN OUR HANDS AS WE SERVE IT TO THE COMMUNITY. WE ASK THAT YOU CONTINUE TO KEEP YOUR STEADFAST HAND UPON US AS WE WALK.
AND WE PRAY ALL THESE THINGS IN JESUS' NAME.
>> I PLEDGE ALLEGIANCE TO THE FLAG OF THE UNITED STATES OF AMERICA AND TO THE REPUBLIC FOR WHICH IT STANDS, ONE NATION UNDER GOD, INDIVISIBLE WITH LIBERTY AND JUSTICE FOR ALL.
>> MS. CORTEZ, PLEASE CALL THE ROLL.
[A. SET THE AGENDA]
>> BEFORE WE SET THE AGENDA, THERE HAS BEEN A NEW AGENDA THAT WAS PASSED OUT. I THAT ITEMS SHOULD BE G-3 AND 4 WERE MOVED TO THE CONSENT AGENDA.
IS THERE ANYTHING-- WOULD YOU GUYS LIKE TO PULL ANY OF THEM?
I WOULD ENTERTAIN A MOTION. >> MOVE TO APPROVE TO SET THE
>> PLEASE CALL THE ROLL. >> MRS. BENNETT?
>> YES, MA'AM. >> MR. LAMMERS?
>> YES, MA'AM. >> MAYOR HUDSON?
>> YES, MA'AM. >> MRS. GIBBONS?
IF WE COULD SET THE-- I'M SORRY. APPROVAL OF THE MINUTES.
[B. APPROVAL OF MINUTES]
HAVE YOU HAD A CHANCE TO REVIEW THE LAST MEETINGS?>> I MOVE APPROVAL. >> SECOND.
>> PLEASE CALL THE ROLL. >> MRS. BENNETT?
>> YES, MA'AM. >> MR. LAMMERS?
>> YES, MA'AM. ARE THERE ANY COMMENTS FROM THE PUBLIC TODAY? OKAY.
MOVING ON. WE HAVE NO RECOGNITION OF EXCELLENCE, NO OLD BUSINESS. NEW BUSINESS, I WILL DEFER TO
YOU, MR. HUTCHINSON. >> ALL RIGHTY.
WELL, THANK YOU, MADAM CHAIR, MEMBERS OF THE BOARD.
[G.1. Seacoast Presentation – Institution Update]
THE FIRST ITEM THIS AFTERNOON IS AN UPDATE ON FPUA'S ACCOUNTS WITH SEACOAST BANK WITH ALL THE RECENT BANKING EVENTS IN THE BANKING INDUSTRY, STAFF THINKS IT IS IMPORTANT TO INFORM THE BOARD ON HOW SEACOAST BANK AND FORT PIERCE UTILITIES ARE WORKING TO PROTECT OUR INVESTMENTS.>> WE CAN HEAR YOU. >> IN YOUR PACKET, YOU WILL FIND A LETTER THAT PROVOIDS A BACKGROUND ON THEIR FINANCIAL POSITION. THE LETTER DESCRIBES THEIR CAPITAL RATIOS, DIVERSIFIED DEPOSIT BASE, AND STRONG BALANCE SHEET TO PROVIDE CONFIDENCE THAT MONEYS ARE SAFE.
ON THE LINE TODAY, HOPEFULLY, HERE VERY SHORTLY, WE WILL HAVE THE SEACOAST TEAM. MR. CHUCK SCHAFER AND DANA MCSWEENEY. TO PROVIDE AN OVERVIEW AND ANSWER ANY QUESTIONS. AND THE DIRECTOR OF FINANCIAL ADMINISTRATION CAN ALSO HELP WITH THE FPUA QUESTIONS.
>> I WOULD LIKE TO DO A BRIEF INTRODUCTION.
MR. HUTCHINSON HAS TOUCHED ON ALL THE POINTS.
IN LIGHT OF SOME EVENTS THAT HAVE HAPPENED IN THE BANKING INDUSTRY, WE ARE CONCERNED, AS MANY OF YOU ARE, ABOUT THE SAFETY OF OUR FUNDS. WE NEED SOME ASSURANCE.
SEACOAST WAS HERE BACK IN JANUARY TO PRESENT TO OUR BOARD ABOUT THEM AND OUR RELATIONSHIP AND OUR BANKING RELATIONSHIP.
WE MET WITH THE-- JAVY AND I MET WITH MR. SCHAFER AND DANA EARLIER LAST WEEK, AND WE DISCUSSED SOME OPTIONS.
THEY ARE HERE TODAY TO EXPLAIN TO THE BOARD AND TO EVERYBODY
[00:05:02]
WHO IS LISTENING WHAT HAS HAPPENED WITH THESE EVENTS, WHY IT HAPPENED, AND HOW THEY ARE GOING TO HELP US AND ASSURE THATOUR MONEY IS SAFE WITH THEM. >> THANK YOU.
I'M THE CHAIRMAN AND C.E.O. OF SEACOAST BANK.
IT IS GREAT TO SPEAK TO YOU ALL AGAIN.
JUST TO TAKE A MOMENT TO TALK ABOUT WHAT HAPPENED IN THE INDUSTRY OVER THE LAST FEW WEEKS.
I'LL TALK A LITTLE BIT ABOUT SEACOAST AND THEN A PROPOSAL WE PUT IN FRONT OF BARBARA AND JAVIER AS A WAY TO COLLATERALIZE THE DEPOSIT TO GIVE YOU ASSURITY ON REDUCING RISK, ESSENTIALLY TO ZERO. LOOKING BACK AT THE FAILURE OF SILICON VALLEY BANK AND SIGNATURE BANK WHICH WERE THE TWO LARGE FAILURES AND THEN SMALLER WAS A BANK CALLED SILVER GATE BANK. ALL THREE HAD VERY UNIQUE BUSINESS MODELS THAT, YOU KNOW, GENERALLY LED TO THE FAILURE OF THOSE BANKS. IN PARTICULAR, MAYBE STARTING WITH THE LARGEST, SILICON VALLEY BANK.
SILICON VALLEY BANK SERVED THE VENTURE CAPITAL AND TECHNOLOGY INDUSTRY PRIMARILY, AND WHAT TRANSPIRED GENERALLY WHEN YOU LOOK BACK AT THAT FAILURE IS DURING THE I.P.O. MARKET AND SPAK MARKET OF 2020 AND 2021, EFFECTIVELY, THE TECH BUBBLE, THE DEPOSITS WITHIN THAT BANK RAPIDLY INCREASED.
ACTUALLY, THE BANK DOUBLED ITS SIZE OVER A TWO-YEAR PERIOD AS CUSTOMERS PILED IN MONEY ASSOCIATED WITH THESE I.P.O.'S FOR THESE TECHNOLOGY COMPANIES. AS THAT OCCURRED, THE BANK CHOSE TO INVEST THOSE FUNDS IN LONG-DURATION SECURITIES, AND AS SUCH, AS TIME WENT ON, THERE WAS A LARGE LEVEL OF SURGE DEPOSITS IN THE BANK. THOSE DEPOSITS STARTED TO RUN OUT AS THE TECHNOLOGY INDUSTRY FACED PRESSURE.
YOU HAVE READ THE HEADLINES. FACEBOOK, GOOGLE, AND OTHERS HAVE BEGUN TO LAY PEOPLE OFF. THE CASH-BURN OF THOSE DEPOSIT CUSTOMERS STARTED TO COME OUT OF THE BANK.
THE BANK THEN, TO TRY TO SHORE UP ITS CAPITAL, RAISED CAPITAL WHICH IN ORDER TO RAISE THE CAPITAL, THEY SOLD THE SECURITIES AND GENERATED A LOSS. THAT LOSS SPOOKED THEIR V.C.
CUSTOMER BASE WHICH IS, AGAIN, VERY CONCENTRATED CUSTOMER BASE.
AND A RUN ON THE BANK BEGAN. JUST TO KIND OF GIVE YOU ONE STAT IN THAT BANK. THE UNINSURED DEPOZTORS REPRESENTED OVER 90% OF THE DEPOSITORS IN THE BANK.
A CONCENTRATED DEPOSIT PORT PORTFOLIO.
SILVER GATE BANK IN THE SAME STATE IN CALIFORNIA, FAILED 100% OVER CRYPTO AND THEIR EXPOSURE TO THE FTX EXCHANGE COLLAPSE.
THE SAM BANKMAN FRIED FRAUD. AND THEN THE OTHER BANK IN NEW YORK, SIGNATURE BANK SERVED A VERY UNIQUE NICHE COMMUNITY, BASICALLY, THE COMBINATION OF LARGE FAMILY OFFICE COMMERCIAL REAL ESTATE DEVELOPERS IN NEW YORK CITY AS WELL AS A LARGE CRYPTO EXPOSURE. AND ESSENTIALLY, WHAT HAPPENED TO THEM, AS A RESULT OF SILICON VALLEY BANK COLLAPSING, THEY-- THE CRYPTO CUSTOMERS BEGAN A RUN ON THE BANK, AND THEN ULTIMATELY, SOME LARGER COMMERCIAL REAL ESTATE CUSTOMERS BEGAN TO WITHDRAW THEIR FUNDS. AGAIN, THEY HAD ROUGHLY 90% OF THEIR DEPOSITS WERE UNINSURED. A CONCENTRATED DEPOSIT POSITION.
YOU COMPARE THAT TO MOST REGIONAL BANKS.
YOU KNOW, THE SEACOAST, FOR EXAMPLE, WE SERVE A MUCH WIDER VARIETY OF CLIENT BASE. WE SERVE SMALL BUSINESSES.
WE SERVE CONSUMERS. WE SERVE COMMERCIAL CUSTOMERS.
LARGE MUNICIPALITIES. YOU KNOW, IT IS A MUCH BROADER CUSTOMER BASE. AND THEREFORE, WE HAVE DIVERSIFYCATION OF FUNDING. SECONDLY, AS WE TALKED ABOUT WHEN I CAME TO THE BOARD MEETING LAST TIME, WE HAVE ONE OF THE HIGHER CAPITAL POSITIONS IN THE INDUSTRY.
EVEN IF WE SOLD ALL OF OUR SECURITIES AND TOOK LOSSES ON ALL OF THEM, WE WOULD STILL HAVE A CAPITAL RATIO.
WHEN YOU STEP BACK AND LOOK AT OUR BANK, WE HAVE BUILT IT WITH A LACK OF CONCENTRATION BY DESIGN.
ONE OF THE LESSONS WE LEARNED IN THE FINANCIAL CRISIS WAS, YOU KNOW, DIVERSIFYCATION TO CAPITAL KEEPS BANKS ALIVE THROUGH CYCLES. CONCENTRATION TO CAPITAL TAKES BANKS DOWN. IF YOU LOOK AT A FEW BANKS THAT ARE MORE WIDER IN THE VARIETY OF THE CLIENT BASE THEY SERVE, THEY
[00:10:02]
REALLY HAVE THE ABILITY TO FUND ANY, YOU KNOW, CHALLENGE TO THAT, EVEN IF THEIR INSURED DEPOSITORS CAME IN TO WITHDRAW FROM THEIR ACCOUNT, FROM LINES OF CREDIT AND OTHER MEANS NECESSARY TO FUND. THE RISK OF THAT OCCURRING AT A BANK LIKE OURS IS MONEY MUS. WE HAVE THE CAPITAL AND DIVERSIFICATION TO WEATHER THINGS THROUGH TIME.A BIG DIFFERENCE IN THE CUSTOMER MAKEUP OF THESE ORGANIZATIONS.
THE OTHER THING THAT WAS DONE BY THE FEDERAL RESERVE THAT IS VERY IMPORTANT, A BIT NUANCED, THEY PROVIDED EVERY BANK A LINE OF CREDIT ON ONE TO ONE TO OUR SECURITIES PORTFOLIO.
WHEN YOU ADD THAT UP WITH WHAT WE HAVE WITH THE FED AND THE-- WE HAVE ACCESS TO $5 BILLION OVERNIGHT AT ANY MOMENT.
THE ABILITY TO DRAW DOWN FUNDS IS, YOU KNOW, SIGNIFICANT AT OUR ORGANIZATION. YOU KNOW, I SAY ALL OF THAT BECAUSE YOU CAN BE 100% CONFIDENT IN THE SAFETY AND SOUNDNESS OF OUR ORGANIZATION, OF "SEACOAST.
WE FEEL 100% CONFIDENT OF WHO WE ARE.
AND REALLY THROUGH THIS PERIOD, EVEN THOUGH WE HAVE HAD CUSTOMERS ASKING, WE HAVE NOT LOST ANY CUSTOMERS OR DEPOSITS WHICH HAS BEEN GREAT. YOU KNOW, THERE ARE WAYS WE CAN BACKSTOP RISK, AND SO, YOU KNOW, I JUST START BY SAYING, YOU KNOW, I FEEL CONFIDENT YOUR MONEY IS SAFE WITH US.
EVEN IF WE DIDN'T WANT TO BACKSTOP IT, YOU WOULD BE TOTALLY FINE. GIVEN CONCERN AND THE MAGNITUDE OF WHAT'S HAPPENING, WE CAN APPRECIATE WHY YOU WOULD WANT SOME COLLATERAL AND THE LIKE. WE HAD THE ICS SWEEP SYSTEM.
WE ARE CAPPED OUT OF THAT AT THIS POINT.
WITH THE FPUA. WHAT WE WOULD LIKE TO PROPOSE IS THAT WE WOULD MOVE THE $100 MILLION WHICH IS THE BOND PROCEEDS, I BELIEVE, OVER INTO A COLLATERALIZED SWEEP PROGRAM.
THAT IS A 100% COLLATERALIZED DEPOSIT AT SEACOAST.
WE WILL COLLATERALIZE THAT EVERY NIGHT WITH A MORTGAGE-BACKED SECURITY. THAT IS GUARANTEED BY THE U.S.
GOVERNMENT. YOU HAVE ZERO RISK OF LOSS.
YOU WILL GET AN EMAIL EVERY NIGHT WITH SOMETHING CALLED A Q NUMBER. YOU COULD LOOK UP THAT BOND AND SEE THE VALUE OF THE COLLATERAL. THIS SHOULD PROVIDE YOU 100% ASSURITY THAT, YOU KNOW, EVEN IF SOMETHING WERE TO HAPPEN TO US, YOU WOULD BE COLLATERALIZED WITH THAT BOND.
YOUR MONEY IS 100% SAFE. IMPORTANTLY, IT PROVIDES YOU THE AVAILABILITY THAT IF YOU WANTED TO WITHDRAW IT ALL AT ANY MO MOMENT, YOU CAN TAKE IT BACK OUT OF THE ACCOUNT.
THERE IS NO RESTRICTIONS ON LIQUIDITY.
WE WOULD HONOR THE SAME RATE PROGRAM THAT WE HAD WITH YOU PRIOR AND ESSENTIALLY, OFFER THIS LEVEL OF SECURITY FOR YOU TO, YOU KNOW, HAVE CONFIDENCE THAT YOU DON'T NEED TO WORRY ABOUT THE MONEY. SEE IF THERE IS ANY QUESTIONS ON
THAT. >> I DO HAVE A QUICK QUESTION.
I UNDERSTAND THAT IT'S 100% LIQUID FOR AT LEAST ACCESSIBLE.
HOW QUICKLY? LET'S SAY WORST-CASE SCENARIO, THAT IT DOES HAVE TO BE FUNDED WITH THAT INSURANCE POLICY.
IS THAT SOMETHING THAT IS GOING TO TAKE A DAY TO GET TO? IS THAT SOMETHING THAT IS COMPLETELY SEPARATE AND
AVAILABLE NO MATTER WHAT TIME? >> CORRECT ME IF I'M WRONG.
YOU WOULD HAVE ACCESS TO ET EVERY DAY WITH NO ISSUE.
>> ABSOLUTELY. THEY WOULD BE ABLE TO-- BARBARA WOULD HAVE ACCESS TO TRANSFER IT FROM THAT ACCOUNT INTO THE OPERATING ACCOUNT, IF THEY FEEL THAT THEY WANT TO TAKE IT OUT
>> HOW WERE THESE FUNDS COLLATERALIZED AGAIN?
>> IT IS GOING TO BE COLLATERALIZED WITH A U.S.
GOVERNMENT MORTGAGE-BACKED SECURITY.
A FANNIE OR FREDDIE MORTGAGE-BACKED BOND.
>> IS THIS WHAT THEY REFER TO AS A COLLATERALIZED DEBT
THIS IS NOT A COLLATERALIZED DEBT OBLIGATION.
THIS WOULD BE-- IT IS A POOL OF MORTGAGES THAT ARE ESSENTIALLY BEING SERVICED BY FANNIE OR FREDDIE.
AND THE U.S. GOVERNMENT BACKS THAT UP.
IT IS-- THERE IS NEAR ZERO RISK OF DEFAULT.
>> ESSENTIALLY, IF THE MORTGAGES GO UNDER AND GO IN DEFAULT, THE U.S. GOVERNMENT WILL PICK UP THE TAB IS.
THAT WHAT I'M UNDERSTANDING? >> CORRECT.
THAT IS CORRECT. THAT IS CALLED AN AGENCY MORTGAGE. THEY ARE THERE BECAUSE THOSE AGENCIES HAVE BEEN CREATED TO FACILITATE THE HOUSING MARKET AND ALLOW-- IT PROVIDES CAPITAL ACCESS TO BORROWERS AROUND THE COUNTRY TO PROVIDE BASICALLY, A LOWER COST OF FUNDING.
THAT IS WHY THOSE AGENCIES WERE CREATED, AND THEY ARE QUASI-GOVERNMENTAL AGENCIES. THEY ARE RUN BY PRIVATE INDIVIDUALS BUT FUNDED BY THE GOVERNMENT.
>> I HAVE A QUESTION. THIS IS NOT ABOUT OUR ACCOUNT, BUT I'M JUST SEEKING INFOR INFORMATION.
[00:15:02]
THE SVB BANK WAS OVERSEEN BY A REGIONAL-- A REGIONAL DEPARTMENT OF THE FED. AS I UNDERSTAND IT.OR THE FDIC. DO WE HAVE A REGIONAL REGULATORY
WE ACTUALLY ARE OVERSEEN BY FOUR AGENCIES.
WE ARE A NATIONAL BANK SO, WE ARE OVERSEEN BY THE OFFICE OF THE COMPTROLLER OF THE CURRENCY. THEY ARE THE PRIMARY REGULATOR.
AND THEN WE ARE ALSO REGULATED BY THE FEDERAL RESERVE.
THE FED ALSO OVERSEES US OUT OF THE FEDERAL HOME... THE FED RESERVE IN ATLANTA. WE ARE PART OF THE MIDSIZED GROUP IN BOTH ORGANIZATIONS. WE GENERALLY ARE OVERSEEN AND MONITORED MORE THAN A SMALLER ORGANIZATION.
WE ARE ALSO REGULATED BY THE FDIC, AND WE ARE REGULATED BY THE CFBB, THE CONSUMER FINANCIAL PROTECTION BUREAU.
WE HAVE FOUR REGULATORS. OUR PRIMARY REGULATORS IS THE
OCC AND THE FED. >> A LOT OF REGULATORS.
LIKE THE FPUA. >> THAT'S RIGHT.
>> WE HAVE A LOT OF REGULATORS. A LOT OF REGULATORS.
WE HAVE A GOOD STANDING AND GOOD RELATIONSHIPS.
ONE OF THE THINGS, THE COMPANY HAS BEEN EVER BEEN AROUND ALMOST A HUNDRED YEARS. ONE OF THE THINGS WE LEARNED OVER TIME, WE KIND OF DO WHAT THE REGULATORS TELL US TO DO.
DON'T ARGUE WITH THEM. >> RIGHT.
YOU SPEAK WITH THE REGULATORS. >> IF THE REGULATORS TELL US, WE TAKE CARE OF IT. WE HAVE A GOOD STRONG RELATIONSHIP WITH THEM. IT IS SOMETHING THAT WE VIEW AS IMPORTANT AS PART OF SAFETY AND SOUNDNESS.
>> THANK YOU. >> MORE QUESTIONS?
>> I JUST HAVE ONE, MADAM CHAIR. AGAIN, THE LAST TIME YOU SPOKE, YOU GAVE US A HIGH DEGREE OF CONFIDENCE, BUT YOU DEFINITELY SPOKE ANOTHER LANGUAGE. IT SEEMED LIKE YOU WENT EVEN DEEPER IN THAT SECOND LANGUAGE TODAY.
ALL THAT BEING SAID, ONE OF THE THINGS THAT YOU MENTIONED WAS THAT EVEN IF YOU SOLD OFF YOUR SECURITIES AT A LOSS, THAT YOU WOULD HAVE A CAPITAL RATIO OF 8.5%.
WHAT DOES THAT REALLY MEAN? IN LEHMAN'S TERMS.
>> SURE. IN LAYMAN'S TERMS, THE BEST WAY I CAN DO IS FRAME IT TO, LIKE, A COMPARABLE TO ANOTHER BANK.
BUT THE TANGIBLE COMMON EQUITY OR THE COMMON EQUITY OF THE OWNERSHIP OF THE COMPANY IS 8.5% OF THE TOTAL ASSETS.
TYPICALLY, THEY CALL IT A CET-1 RATIO.
BASICALLY, THE HIGHER LEVELS OF CAPITAL IS ROUGHLY A LITTLE OVER 10%. WHEN YOU LOOK AT OUR REGULATORY RATIOS, THEY ARE AROUND 14%. THAT PUTS US IN THE UPPER QUARTILE OF BANKS. LIKE I SAID, EVEN IF WE SOLD OUR SECURITY BASE, WE WOULD BE UPPER QUARTILE.
COMPARE THAT TO SVP WHICH REALLY HAD NEGATIVE EQUITY.
THAT WAS WHAT TRIGGERED THEM TO DO A CAPITAL RAISE.
THEY LET THEIR EQUITY FALL SO LOW, THAT THEY BECAME A PROBLEM.
YOU COMPARE US TO A NATIONAL BANK.
EVEN A TOP-FIVE BANK, GENERALLY RUNSES WITH A 5% TO 6% TANGIBLE COMMON EQUITY RATIO TO TANGIBLE ASSETS.
WE RUN WITH A LOT OF CAPITAL, AND THE REASON WE DO THAT IS FLORIDA OVER THE LONG-TERM, AGAIN, BEING IN FLORIDA, ONLY IN FLORIDA AND HAVING A HUNDRED-YEAR HISTORY, WE HAVE LEARNED TO MANAGE THROUGH CY CYCLES, THAT CONSERVATISM AROUND CAPITAL AND LIQUIDITY ARE IMPORTANT.
WE TYPICALLY HAVE-- REALLY OUR RISK HAS BEEN REAL ESTATE CYCLES HISTORICALLY. BECAUSE YOU HAVE PEOPLE MOVING TO FLORIDA, YOU HAVE VOLATILE REAL ESTATE MARKETS.
WE CARRY A LOT OF CAPITAL TO MAKE SURE WE ARE ALWAYS GOING TO BE AROUND. YOU KNOW, COMING INTO THIS PERIOD, A LITTLE BIT DIFFERENT PROBLEM HAS EMERGED.
THE CAPITAL STILL IS EXTREMELY STRONG.
FROM A CAPITAL PERSPECTIVE, WE ARE, YOU KNOW, MUCH ABOVE WHAT THEY WOULD CALL WELL CAPITALIZED.
AND YOU KNOW, WE HAVE VERY STRONG CAPITAL RATIOS.
THAT IS THE RISK IN THE BANK. WHEN YOUR CAPITAL BEGINS TO FALL, THAT IS WHEN THE REGULATORS ESSENTIALLY COME IN AND SHUT YOU DOWN. TYPICALLY, THEY BURN THAT CAPITAL THROUGH CREDIT. NOT NECESSARILY THROUGH THE SITUATION. DIFFERENT SCENARIO.
CAPITAL IS ALWAYS KING. >> SO-- SO TO KIND OF SUMMARIZE THE AMOUNT THAT YOU LEND OUT COMPARED TO THE AMOUNT OF DEPOSITS THAT YOU HAVE, IT IS A HIGHER RATIO THAN WHAT YOU
TYPICALLY SEE. >> I WOULD DESCRIBE IT THE OTHER WAY. WE TYPICALLY RUN WITH A LITTLE BIT LOWER MONEY BEING OUT, MORE DEPOSITS, WHICH IS GOOD.
SO YOU HAVE MORE LIQUIDITY. BUT THEN THE AMOUNT OF EQUITY-- BANKS ARE LIKE LEVERAGE VEHICLES, WITHOUT GETTING TOO MUCH INTO THE WEEDS HERE. BANKS ARE LERCHGED ON CAPITAL.
[00:20:01]
CAPITAL SUPPORTS THE BALANCE SHEET, IF YOU WILL.THE MORE CAPITAL YOU HAVE, THE BETTER.
IT IS ESSENTIALLY LIKE IF YOU WERE RUNNING A COMPANY AND YOU HAD A BUNCH OF SHAREHOLDERS' EQUITY.
THE STRONGER YOUR COMPANY IS OVER TIME.
I DID SAY THAT BACKWARDS. THE AMOUNT THAT YOU COULD LEND
OUT MORE THAN YOU DO. >> CORRECT.
>> ONE OF THE BIG THINGS WE LEARNED MANAGING THROUGH THE FINANCIAL CRISIS WAS CONSERVATISM AND NOT ALLOWING ANY CONCENTRATIONS TO CAPITAL. WE HAVE TO CONCENTRATIONS ON EITHER SIDE OF THE BALANCE SHEET.
NO CONCENTRATED LENDING. NO CONCENTRATED DEPOZTORS.
THAT HAS BEEN A RISK MANAGEMENT PROGRAM HERE FOR LONG PERIOD OF
TIME. >> BARBARA, ARE WE MISSING ANYTHING YOU WOULD LIKE US TO HEAR?
>> NO. IF THE BOARD HAS A DESIRE TO MOVE NOORD, WE CAN MOVE FORWARD WITH OPENING UP THE ICS ACCOUNT FOR THE MONEY MARKET THAT WE HAVE.
IN THE EVENT THE $100 MILLION THAT WE ARE SAVING FOR THE WASTEWATER PLANT WILL BE SECURE AND BE THERE WHEN WE NEED IT.
>> YES. >> THAT IS ANOTHER LAYER OF
SECURITY. >> THAT IS ANOTHER LAYER OF
SECURITY THAT THEY ARE OFFERING. >> YES.
>> IS THERE A COST TO THAT, BARBARA?
>> CHUCK, I BELIEVE THERE IS A COST.
I THINK THEY DISCUSSED IT BEING ON THEM.
>> WE ARE GOING TO ABSORB THE COST.
GIVEN THE SICS. GIVEN THE CIRCUMSTANCES.
>> I DON'T SEE HOW WE CAN TURN THAT DOWN.
>> SEACOAST HAS ALL OF OUR FUNDS.
CORRECT? >> IN VARYING ACCOUNTS.
WE HAVE SOME OTHER ACCOUNTS, OTHER BANKS.
CD'S, MONEY MARKETS. THE MAJORITY OF IT, YES.
SEACOAST IS OUR OPERATING BANK. >> OKAY.
DO YOU SEE US NEEDING ANOTHER ACCOUNT JUST TO-- IN THE EVENT-- I KNOW THAT WITH THE SVB, THEY WAITED A DAY BEFORE THEY HAD FUNDS AVAILABLE OR ANYTHING-- I MEAN, OBVIOUSLY, I'M NOT FORESEEING THAT. IF WE HAD TO WAIT, THAT MAYBE WE NEED TO HAVE SOMETHING TO COVER PAYROLL OR SOMETHING.
THAT WOULD BE IN A DIFFERENT AREA TO BE ABLE TO GET TO IF WE
NEED IT FOR A DAY? >> I DON'T BELIEVE SO.
I MEAN, WE COULD. BUT WHAT WE HAVE OFFERED, WHAT WE HAVE GOING ON WITH SEACOAST RIGHT NOW, WE WOULD WANT SOMETHING SIMILAR ASSURANCE. PAUSE $250,000 IS NOT EVEN
>> SO WE WOULD NEED MANY BANKS OR WE WOULD NEED A BANK WHO IS GOING TO OFFER US ASSURANCE THAT QUP SEACOAST IS DOING RIGHT NOW.
THAT WOULD BE SOME KIND OF A SHOPPING AROUND RFP.
WE WOULD HAVE TO GO OUT AND FIND THAT UNIQUE BANK.
>> JUST TO REMIND YOU AS WELL, YOU HAVE MOST OF THE FUNDS IN ICS AS WELL. YOU ARE PRETTY MUCH COLLATERALIZED ALL THE WAY THROUGH.
YOU GUYS HAVE VERY STRONG COLLATERAL PROTECTION.
>> YEAH. OUR OPERATING ACCOUNT, AND THE BOND ACCOUNT ARE BOTH ICS. THAT MEANS IT SWEEPS OUT EVERY NIGHT. IT IS INSURED.
COMES BACK IN IN THE MORNING. BUT WE HAVE THE MONEY MARKET FOR THAT LION'S SHARE OF THAT MONEY. WE PUT IT INTO THE MONEY MARKET BECAUSE THEY ARE GIVING US A VERY GOOD RATE.
THAT MONEY MARKET IS NOT INSURED.
THEY ARE GIVING US AN AVENUE TO TAKE.
>> RIGHT. >> THAT WOULD INSURE IT.
WE WOULD HAVE TO FIND SOMETHING SIMILAR TO THAT OUTSIDE SEACOAST TO. GET THE SAME COMFORT.
>> RIGHT, RIGHT. I APPRECIATE THEIR EFFORTS, FOR
>> DO WE NEED A MOTION FOR THIS? BARBARA?
>> I THINK IT IS JUST INFORMATIONAL.
IF THEY WANT TO GO FORWARD WIT, THEY CAN DO IT.
>> AS LONG AS IT'S THE BOARD'S-- YOU KNOW --
>> WELL, I SUPPORT IT. >> I IS UP SUPPORT IT.
>> ANYTHING THE FED WANTS TO GUARANTEE, I'M FOR IT.
FOR SURE. >> I'M NOT THE BOARD HERE.
>> WE HAVE TO BE ABSOLUTELY SURE WE OUGHT TO HAVE A MOTION.
I MEAN -- >> IT IS A BIG DEAL.
>> YOU CAN. IT IS NOT AN AGENDA ITEM.
>> YOU CAN ADD-- MAKE A MOTION TO MOVE IT TO AN ACTION ITEM.
THEN MAKE A MOTION ON THE ITEM, IF YOU WOULD PREFER.
>> DO WE NEED THAT? >> IF IT'S THE DESIRE TO DO IT, JUST TO MAKE SURE THAT THE DIRECTION IS CLEAR TO STAFF, THEN YOU CERTAINLY COULD. BUT I DON'T KNOW THAT IT IS NECESSARY IF YOU WANT TO GIVE YOUR GENERAL GUIDANCE TO STAFF TO TAKE A COURSE OF ACTION. YOU CAN DO THAT AS WELL.
IF YOU WOULD LIKE TO MAKE A FORMAL ACTION, YOU CAN MOVE IT
TO ANO A ITEM. >> IF YOU THINK CONSENSUS DOES
IT, IS THAT ALL RIGHT WITH YOU? >> I THINK STAFF IS VERY CLEAR
ON THE DIRECTION OF THIS. >> RIGHT.
YEAH. I MEAN, NOBODY IS NOT IN SUPPORT OF THIS. RIGHT?
>> THIS IS GOING TO BE LIMITED TO THE BOND PROCEEDS.
CORRECT? THAT IS MY UNDERSTANDING.
[00:25:02]
THAT ONE ACCOUNT. THE MONEY MARKET ACCOUNT.
>> THANK YOU, SEACOAST. >> THANK YOU, CHUCK, AND DANA.
WE APPRECIATE THE RELATIONSHIP. WE VALUE IT TREMENDOUSLY.
AND MANY, MANY YEARS WE HAVE WORKED TOGETHER.
WE APPRECIATE THE OPPORTUNITY TO SPEND TIME WITH YOU TODAY.
DANA WILL BE READY FOR YOU, BARBARA, WHEN YOU WANT TO SIGN THE PAPERWORK. (LAUGHTER).
>> THANK YOU, EVERYBODY. >> ALL RIGHT.
[D. CONSENT AGENDA]
BEFORE WE MOVE FORWARD, IT WAS BROUGHT TO MY ATTENTION THAT I DID NOT GET AN APPROVAL FOR THE CONSENT AGENDA.>> MOVE FOR APPROVAL. >> SECOND.
PLEASE CALL THE ROLL. >> MRS. BENNETT?
>> YES, MA'AM. >> MR. LAMMERS?
>> YES, MA'AM. >> MAYOR HUDSON?
>> YES, MA'AM. ALL RIGHT, MR. HUTCHINSON.
THANK YOU, MADAM CHAIR. NEXT, ITEM IS A REQUEST TO APPROVE THE SINGLE-SOURCE PURCHASE OF AN UNDERGROUND ELECTRIC CABLE. MR. ERIC WINTERSTEIN WILL MAKE
THE PRESENTATION. >> HE WAS JUST HERE.
IF IT IS ALL RIGHT WITH YOU, MADAM CHAIR, CAN WE MOVE ON TO THE NEXT ITEM. WE WILL GET THIS STRAIGHTENED OUT. IF NOT, WE WILL TURN IT OVER TO MR. RUTHERFORD TO MAKE THE PRESENTATION.
[G.3. Approval of Emergency Purchasing of Goods and Services related to supply chain shortages due to ever‐changing and fast‐paced market of essential services and goods. Approve through end of calendar year.]
SO SPEAKING OF MR. RUTHERFORD, THE NEXT ITEM IS A REQUEST FOR THE APPROVAL OF THE EMERGENCY PURCHASE FOR GOOD AND SERVICES.
THAT IS RELATED TO THE ONGOING SUPPLY CHAIN SHORTAGES.
DURING THE LAST BOARD MEETING, MR. CISNEROS ADVISED THE BOARD OF ONE SPECIFIC PROJECT, OF MANY, THAT WAS ADVERSELY AFFECTED BY THE INDUSTRY TRANSFORMER SHORTAGE.
IN PARTICULAR. SINCE THEN, WE WERE ABLE TO FIND A TEMPORARY ALTERNATIVE FOR THAT ONE PARTICULAR DEVELOPMENT.
HOWEVER, WE NEED TO GET IN FRONT OF THIS AGAIN LIKE WE DID LAST YEAR. YOU WILL RECALL THAT THE BOARD APPROVED A REQUEST, A TEMPORARY REQUEST DURING LAST SUMMER TO ALLOW THOSE EMERGENCY PURCHASES. THAT EXPIRED IN DECEMBER OF 2022. I WILL TURN IT OVER TO MR. DANIEL RUTHERFORD, OUR UTILITY SERVICE DIRECTOR.
>> THANK YOU, MR. HUTCHINSON. GOOD AFTERNOON, MADAM CHAIR AND BOARD MEMBERS. AS YOU WILL RECALL, LAST YEAR AROUND THIS TIME, WE CAME TO YOU WITH A PROPOSAL AND A REQUEST FOR THE ABILITY TO MAKE SOME OPPORTUNITY BUYING ON THE MA MARKET. WE WERE GOING TO MAKE EVERY EFFORT TO FOLLOW THE PURCHASING GUIDELINES, BUT IF WE FOUND SOME OPPORTUNITIES TO GET SOME TH THINGS, THAT WOULD PUT US IN A BETTER POSITION FOR HURRICANE SEASON OR TO PREVENT THE LOSS OF ESSENTIAL SERVICES, WE WOULD BE ABLE TO ACT ON A SOLE SOURCE OR PURCHASE ON THE MARKET HERE LOCALLY.
WE HAVE DID THAT ON A FEW OCCASIONS.
A LITTLE SUMMARY OF WHAT WE DID WITH THAT, I'M SURE YOU ARE CURIOUS. A TOTAL OF ABOUT $240,000 OF PURCHASES. THERE WERE ONE, TWO, THREE, F FOUR, SIX PURCHASES. TWO OF THOSE WERE JUST SOME P
PIPE, BUT POLYETHYLENE PIPE. >> WE PURCHASED-- THEY HAD A RUN ON ONE TYPE OF PIPE AND THEY HAD SOME.
WE TALKED TO A VENDOR. THEY SAID "I HAVE SOME." IF WE WERE INTERESTED. WE SAID HECK YES.
IT WAS OPPORTUNITY BUYING. WE BOUGHT IT.
WE HAVE USED SOME OF IT. SOME OF IT IS IN THE YARD.
WE BOUGHT SOME IRON POLES. SOME ELECTRIC POLES.
WE BOUGHT ALSO SOME TANKLESS WATER HEATERS.
THAT IS A PRETTY GOOD STORY. LY TELL YOU THAT ONE HERE IN A SECOND. FIBER OPTIC SPLICING TRAILER.
WE DIDN'T HAVE A TRUCK. WE DIDN'T HAVE ANYTHING.
OUR TRUCK WASN'T GOING TO COME IN UNTIL THIS YEAR.
WE HAD AN OPPORTUNITY TO BUY A TRAILER.
THEY WERE GOING FAST. AND WE FOUND ONE.
JASON BOUGHT IT. THAT IS ONE OF THE THINGS WE D DID. THEN WE BOUGHT SOME CABLE OFF OF THE MARKET. THE ONE INTERESTING STORY THAT WE DO HAVE THAT WE FOUND SOME OPPORTUNITY BUYING WAS WE HAD A SUBDIVISION GOING IN, AND THEY NEEDED A TRANSFORMER.
WE COULDN'T GET ONE ON THE MARKET.
THERE WAS NOTHING WE COULD DO. TYPICALLY, THEY DIDN'T EXPECT TO HAVE A TWO OR THREE-YEAR WAIT ON TRANSFORMERS.
YOU KNOW, THOSE FOLKS WERE READY TO MOVE.
IN READY TO DO THOSE THINGS. WE WENT AND SET UP A PROGRAM FOR THEM TO PURCHASE THEM GAS WATER HEATERS.
HEATERS. AND PULL OUT THEIR ELECTRIC ONES. OR NOT-- THEY DON'T PURCHASE
[00:30:01]
ELECTRIC ONES. THAT LOWERED THE SIZE REQUIREMENT ON THEIR TRANSFORMER WHICH WE COULD SUPPLY.SO THAT WAS ONE OF THE THINGS. THAT OPPORTUNITY BUYING ALLOWED THAT SUBDIVISION TO KEEP MOVING. WE DIDN'T GET INTO A BIG POLITICAL MESS ON HOW WE ARE HOLDING UP THE WORLD.
THAT WORKS REALLY WELL. THOSE ARE THE PURCHASES WE MADE ON THE PROGRAM. RIGHT NOW THIS YEAR, IN 2023, WE ARE EXPECTING TO SEE THE CONSTRUCTED-- CONSTRUCTION INDUSTRY SHRINK BY PROBABLY ANOTHER 7% TO 10%.
WHAT DOES THAT MEAN? WHAT THAT MEANS IS THE FOLKS WHO MAKE ALL THE STUFF, THE MATERIALS THAT WE LIKE TO PURCHASE AND BUY, BECAUSE OF THE INABILITY FOR THEM TO GET MATERIALS, THOSE BUSINESSES ARE GOING AWAY.
A LOT OF BUSINESSES ARE SHUTTING THEIR DOORS.
SILICON VALLEY SHUTTING THEIR DOORS.
THE PROTOCOLS WITHIN SOME OF OUR INTERNATIONAL MARKETS LIKE CHINA FOR COVID STILL EXIST. AS THOSE STILL EXIST AND THEY STILL PROPAGATE THROUGH THOSE COUNTRIES, IT IS HARDER AND HARDER FOR THEM TO MAKE MATERIALS THAT WE NEED TO MAKE OUR CHIPS. THINGS LIKE THAT.
WE DON'T EXPECT TO SEE ANY, ANY BETTER SITUATION THIS YEAR THAN WE DID LAST YEAR. AS A MATTER OF FACT, IT MAY EVEN GET A LITTLE WORSE FOR SOME OF THE INDUSTRIES.
SO WE WOULD REQUEST TO BE ABLE TO CONTINUE THE OPPORTUNITY BUYING. WE ARE DOING A GREAT JOB, I BELIEVE, IN NOT TAKING ADVANTAGE OF AN EMERGENCY.
WE ARE STILL TRYING TO FOLLOW ALL OF THE RULES.
AND EVERYTHING WE DO. WE HAVE SOME GOOD OPPORTUNITY TO PURCHASE THINGS TO GET THEM IN THE YARD, TO PUT US IN A BETTER SITUATION. WE HAVE DONE IT.
I THINK WE DID WHAT WE SAID WE WOULD DO LAST YEAR.
WE ARE ASKING FOR THE OPPORTUNITY TO DO IT AGAIN THIS YEAR. AND WE WILL END IT-- I KNOW ONE OF THE THINGS IS, WHEN ARE YOU GOING TO END? I WOULD SUGGEST THAT WE MAKE THE END OF THIS ONE.
THIS APPROVAL THE END OF THE YEAR.
DECEMBER. SO JANUARY # OR DECEMBER 31.
>> THE CALENDAR, NOT THE FISCAL YEAR?
>> CALENDAR YEAR. LAST YEAR WE FOUND WE ENDED HURRICANE SEASON, FISCAL YEAR. WE GOT NEW MONEY AT THE END OF THE FISCAL YEAR OR THE BEGINNING OF THE NEXT FISCAL YEAR, AND WE COULDN'T SPEND IT ON. THAT OUR DEAL WAS OVER.
WE ARE, LIKE, WE JUST GOT OUR MONEY AND WE HAVE TO PASS ON THE DEAL. I WOULD LIKE TO PUSH IT TO THE CALENDAR YEAR AS OPPOSED TO THE FISCAL YEAR.
THAT WILL ALLOW US TO SEE WITH THE NEW MONEY, THE FISCAL YEAR, WHETHER T THERE IS OPPORTUNITIES OUT THERE THAT PUT US IN A
BETTER POSITION. >> MAKES SENSE.
QUESTIONS? >> MADAM DISMAIR I APPRECIATE THAT, MR. RUTHERFORD. I SPOKE WITH JAVY ABOUT THIS ISSUE A LITTLE EARLIER. HAVING BEEN ON THE OTHER SIDE OF THIS, IN THE POSITION OF REQUESTING FOR PURCHASES, I UNDERSTAND THAT THE PROCESS THAT WE TYPICALLY FOLLOW CAN HINDER US FROM DOING THE BEST THING FOR THE CUSTOMER SOMETIMES.
OR AT THE VERY LEAST, MAKE IT MUCH MORE DIFFICULT.
THAT BEING SAID, THE PROCESS ALSO SERVES VALUE TO THE CUSTOMER IN ENSURING THAT STAFF IS BEING HELD ACCOUNTABLE FOR ALL OF THEIR PURCHASES BECAUSE THERE ARE OTHER EYES AND POLITICAL ICY BEING PUT ON WHETHER DOLLARS GET SPENT.
SO THAT IT IS NOT JUST THE TECHNICAL FOLKS MAKING THE DECISIONS. WE ALSO HAVE A CHANCE TO CRITICALLY ANALYZE ALL OF THE PURCHASES.
WE ARE IN A POSITION RIGHT NOW WHERE I AGREE WITH STAFF.
THE CURRENT PROCESS DOESN'T REALLY WORK AND ALLOW THEM TO STILL BE EFFECTIVE. I'M DEFINITELY A BIG FAN OF APPROVING THIS REQUEST. THAT BEING SAID, I THINK IT IS A GOOD IDEA, AND IT IS PROBABLY APPROPRIATE FOR IT TO BE UNDER DIRECTOR'S COMMENTS. THAT WHEN A PURCHASE IS MADE UNDER THIS REQUEST, THAT THERE IS A REPORT OF ALL OF THOSE ITEMS GIVEN TO THE PUBLIC AND TO THE BOARD UNDER DIRECTOR'S COMMENTS EVERY MEETING. SO THAT IS MY ONE-- I'M A FAN OF THE REQUEST. AS I UNDERSTAND, WE ARE GOING THROUGH SOME CIRCUMSTANCES WHICH MAKE IT VERY DIFFICULT FOR YOU GUYS TO TO BE EFFECTIVE AT WHAT THE YOU DO.
AT THE SAME TIME, THOSE RULES ARE THERE FOR A REASON.
IF WE CAN BE UPDATED AS A BOARD, AND AGAIN, THE PUBLIC CAN BE UP UPDATED AS TO WHAT'S BEING PURCHASED UNDER THIS PARTICULAR CHANGE AND HOW OUR PROCESSES ARE DONE, I THINK THAT IS THE BEST
>> I WONDER IF-- AT THE CITY, WE GET A REPORT OF THINGS THAT ARE LESS THAN THE CITY MANAGERS' SPENDING AUTHORITY.
IT IS JUST A WRITTEN-- IT IS ADDED TO EVERY AGENDA.
THESE ARE THE CONTRACTS. WE SIGN THIS.
THIS IS THE MONEY I HAVE SPENT. THAT IS LESS THAN, YOU KNOW, SO IT KEEPS THE BOARD INFORMED. IT COULD BE SOMETHING LIKE THAT.
>> IS THAT WHAT YOU ARE SAYING? >> MAYBE THAT IT IS NOT EVEN
[00:35:01]
MENTIONED IN THE BOARD MEETING. >> RIGHT.
>> IT IS PART OF THE PACKET. >> YES.
>> I LIKE THAT. >> SOMETHING CIRCULATED BY EM EMAIL. HOW YOU ARE USING THIS NEWFOUND AUTHORITY. SO I'M FOR IT FOR ANOTHER YEAR.
I DON'T KNOW IF I CAN GO FOR A THIRD YEAR.
DEFINITELY SOME SORT OF COMMUNICATION TO KNOW THAT WE ARE NOT GOING OUT WITH A BLANK CHECK AND BUYING EVERYTHING BECAUSE WE. CAN.
THAT IS OUR RESPONSIBILITY, TOO. >> EXACTLY.
>> OVERSIGHT. >> YOU KNOW, THE BOTTOM OF EVERY AGENDA, I THINK, WE HAVE SOME CONTRACTS OR SOME PURCHASES WE DO. UNDER $50,000.
THEY ARE FOR INFORMATION ONLY. THEY ARE NOT LISTED.
IT IS THERE SO IT IS TRANSPARENT.
I SUGGEST WE ADD SOMETHING LIKE THAT THERE.
>> EXACTLY. USE IT UNDER EMERGENCY POWER.
WE DON'T HAVE TO TALK ABOUT IT. IF WE HAVE QUESTIONS, WE CAN
ASK. >> IT IS EXPLICITLY STATED THAT THIS IS OVER THE TYPICAL SIGNATURE AUTHORITY BUT IS
PURCHASED UNDER THIS-- WHATEVER. >> YES, SIR.
>> I LIKE IT ON THE AGENDA AS WELL BECAUSE IT IS THEN OUT IN THE PUBLIC. IF IT IS AN EMAIL, FOR EXAMPLE,
THEN -- >> A REQUEST ON THE AGENDA.
>> YES. >> I HAVE NO PROBLEM BEING
TRANSPARENT. >> I ALSO THINK, MADAM CHAIR, AND I'M SURE JAVY IS LOOKING AT THIS, IS THAT IF THE PURCHASING PROCESS IS OVERLY CUMBERSOME, IT SHOULD BE STREAMLINED.
WHERE WE ARE STILL PROTECTED. I DON'T KNOW THAT IT IS OR IT ISN'T. IT SHOULD BE LOOKED AT AND SAID, DO WE HAVE TO DO IT THIS WAY? I MEAN, IT SHOULD BE-- YOU SHOULD TRY TO OBVIOUSLY FOR EFFICIENCY, BUT ALSO NOT TO DO ANYTHING THAT ISN'T-- DOESN'T HAVE PROPER OVERSIGHT.
>> RIGHT. >> WE ARE CROSSING OUR FINGERS THAT THIS IS A TEMPORARY SITUATION THAT WE ARE IN.
WITH THE SUPPLY CHAIN. IF IT ENDS UP NOT BEING, WE WILL HAVE TO TAKE A CLOSER LOOK AND MAYBE PIVOT ON HOW WE DO THINGS.
THOSE RULES ARE THERE TO PROTECT NOT ONLY THE CUSTOMER BUT US AND THE U.A. SO WE TAKE A LOOK AT THEM OFTEN.
HOPEFULLY, THIS IS TEMPORARY. >> I'LL SAY THIS.
BEFORE I WAS ON THE BOARD, THE BOARD APPROVED INCREASE OF SIGNATURE AUTHORITY OF THE LIMITS.
THEY WERE ABLE TO DO WITHOUT GETTING APPROVAL BY THE BOARD.
I THOUGHT THAT WAS A GOOD MEASURE.
IT WAS PROBABLY TEN YEARS BEHIND WHERE IT SHOULD HAVE BEEN.
>> YEAH. >> EVEN THE CITY WAS AHEAD OF
SO I WOULD NOT AT ALL BE OPPOSED TO LOOKING AT THAT AGAIN AND SEEING IF WE COULDN'T RAISE IT MORE.
ESPECIALLY SINCE EVEN WHEN IT WAS APPROVED, IF IT WAS BEHIND THEN, IT IS MORE BEHIND NOW. BECAUSE WE EXPERIENCED SO MUCH
IS IT $50,000? >> $50,000 FOR THE DIRECTER TO OF THE UTILITY. HOW MUCH IS THE CITY MANAGER IN.
>> IF WE LOOK AT IT AND CHANGE IT, IT WILL SPREAD.
>> RIGHT. >> YOU KNOW, WE DID POLL SOME SISTER UTILITIES. WE HAVE SEEN EVERYTHING FROM $25,000 UP TO $250,000 DIRECTOR APPROVAL LIMITS.
MAYBE IT HAS SOMETHING TO DO WITH THE SIZE OF THE BUDGET.
THEY ONLY HAVE ONE UTILITY AS WELL.
>> YES, YES. >> THE REE AL TILL OF IT IS MOST OF THE REQUESTS THE BOARD-- THAT THE STAFF PRESENTS TO US, THERE IS NO LOGICAL REASONS FOR US TO DENY IT.
>> RIGHT. >> THE MAJORITY OF THEM.
I WOULD SAY 90% OF THEM. >> THEY AREBUDGETED.
WE HAVE TO HAVE THEM. >> RIGHT.
>> EXACTLY. WE ARE JUST GOING THROUGH THE ROPES. THERE IS NO REASON TO.
>> IT SLOWS THE PROCESS DOWN IN MOST CASES.
>> AND IT IS GOOD FOR IT TO BE IN THE PUBLIC EYE, TO BE FULLY TRANSPARENT AND ALL OF THAT STUFF.
I AGREE WITH ALL OF THAT. THAT IS VERY IMPORTANT TO ME.
BUT I'M NOT A FAN OF MAKING THINGS OVERLY CUMBERSOME AND
WASTING TIME AND ENERGY FOR NO >> AND IT IS OVERSIGHT.
I MEAN, IT IS REQUIRED. OVERSIGHT IS REQUIRED.
SO EVEN IF IT IS, LIKE,-- THERE IS NO OTHER SOURCE AND YOU HAVE TO BUY IT AT THIS PRICE, AND YOU KNOW, THEY TELL US ALL OF THAT,
I MEAN, IT IS OVERSIGHT. >> ONE OF THE THINGS I THINK ABOUT, TOO, WHEN WE ARE HAVING THESE TYPES OF DISCUSSIONS IS I TAKE THE FACT THAT I HAVE A VERY HIGH DEGREE OF CONFIDENCE IN LEADERSHIP AND THE CURRENT PEOPLE INVOLVED IN THE SITU SITUATION. OKAY, LET'S IMAGINE EVERYONE IS COMPLETELY DIFFERENT. AND WE HAVE A DIFFERENT SCENARIO. HOW DO THE RULES AFFECT THAT SCENARIO? I TRY TO KEEP THAT IN MIND AS
>> I'LL MAKE A MOTION TO APPROVE.
>> POINT OF CLARIFICATION. WITH ALL THAT DISCUSSION, ARE
[00:40:01]
YOU LOOKING TO AMEND THE MOTION TO INCLUDE A CONDITION THAT IT BE INCLUDED IF THERE ARE EXPENDITURES OUTSIDE OF THAT, THAT IT BE INCLUDED ON THERE? F OR ARE YOU JUST PROVIDING GUIDANCE TO STAFF IF YOU WOULD LIKE TO SEE THAT.>> WHICH CONDITION? >> ADDING THE NOTES.
>> ADVISORY NOTES. ON THE AGENDA.
WITH THE LIMITS. >> TO MAKE IT A REQUIREMENT.
IS THAT JUST GUIDANCE? >> I THINK IT IS GUIDANCE FOR STAFF. I MEAN, I DON'T THINK THERE IS A NEED FOR US TO ADD-- AMEND THE MOTION.
IF THEY DON'T DO IT, THEY WILL HAVE TO COME BACK AND FACE US.
(LAUGHTER). >> IT WILL BE A LOT HARDER.
I'M PRETTY SURE WE WON'T FORGET. >> STAFF IS VERY CLEAR.
LY MAKE A MOTION TO APPROVE. WHAT DO WE HAVE SNEER THE EMERGENCY PURCHASING OF GOODS AND SERVICES FOR-- FOR THIS CALENDAR YEAR? FOR 2023?
>> SECOND. >> PLEASE CALL THE ROLL.
>> MRS. BENNETT? >> YES, MA'AM.
>> MR. LAMMERS? >> YES, MA'AM.
>> MRS. GIBBONS? >> YES, MA'AM.
>> I APPRECIATE IT. THANK YOU.
[G.2. POA NO. 22‐31: Approve 1) the single source purchase of 15kV underground electric cable from Stuart C. Irby Company, of Jackson, Mississippi, in an amount not to exceed $47,810; and 2) additional funding in an amount not to exceed $700,000 annually for inventory purchases, for a total of $747,180 for the period of March 15, 2023 thru March 14, 2024.]
>> ALL RIGHT. THE NEXT ITEM UP.
THE SINGLE-SOURCE PURCHASE OF UNDERGROUND ELECTRIC CABLE.
MR. WINTERSTEIN IS BACK TO MAKE THIS PRESENTATION.
THANK YOU. >> GOOD AFTERNOON, MADAM CHAIR.
MADAM MAYOR, MEMBERS OF THE BOARD.
EXCUSE ME FOR MY CONFUSED MOMENT THERE.
OKAY? I CAME TO REQUEST APPROVAL OF POA NUMBER 22-31. APPROVAL TO SINGLE-SOURCE PURCHASE OF 15KV UNDERGROUND ELECTRIC CABLE FROM STUART IRBY CABLE COMPANY FROM JACKSON, MISSISSIPPI.
TWO ADDITIONAL FUNDINGS IN THE AMOUNT NOT TO EXCEED $700,000 ANNUALLY FOR INVENTORY PURCHASES FOR A TOTAL OF $747,000 FOR A PERIOD OF MARCH 15, 2023 THROUGH MARCH 14, 2024.
INVENTORY IS TO BE ORDERED FROM QUALIFIED VENDORS WITH THE LOWEST BASE OF PRICING. ADVANCED UTILITY RESOURCES SUPPLY INC. RC IS THE INTERACTIVE NETWORKING SOFTWARE PLATFORM THAT PROVIDES VALUE TO AGENCIES.
VENDORS MUST BE QUALIFIED BY AGENTS IN ORDER TO BE PART OF THE SYSTEM. ON SEPTEMBER 15, 2020, THE BOARD APPROVED THE PO CONTRACT WITH STUART C. IRBY COMPANY.
THE POWER AGENCY JOINT PURCHASING PROJECT IN THE AMOUNT NOT TO EXCEED $200,000 ANNUALLY FOR 15-VOLT UNDERGROUND ELECTRIC CABLE FOR INVENTORY. IRBY INFORMED FPUA OF THE TERMINATION OF THE CONTRACT DUE TO UNPRECEDENTED PRICING AND SOURCING FLUCTUATIONS IN THE MARKET.
DUE TO THE INCREASING PRICES IN SOURCING, FPUA WILL BE MAKING INVENTORY PURCHASES AT 15-K UNDERSTOOD GROUND.
ARE THERE ANY QUESTIONS? >> IS THIS BUDGETED? I DON'T HAVE A MARK ON MY REPORT WHETHER IT IS BUDGETED OR NOT.
>> SECOND QUESTION. SO WE ARE GOING TO COMPETITIVELY BID, AND WE HAVE AN OFFER FOR $47,810 TO PURCHASE?
>> AND WHAT WAS THE PREVIOUS AUTHORITY?
WE WERE ONLY UP TO $200,000? >> THAT IS WHAT THE-- THAT IS WHAT IT SAYS. THEY ARE GOING UP-- AN AMOUNT
NOT TO EXCEED $200,000 ANNUALLY. >> ANNUALLY.
YOU WANT TO BE ABLE TO BID, NOT TO EXCEED $700,000?
>> AND BEFORE IT WAS $200,000. NOW YOU WANT TO GO UP TO
>> CAN YOU GIVE US SOME INSIGHT. >> IT HAS TO DO WITH GROWTH.
>> IT IS TRIPLE THE COST. IS THAT WHAT WE ARE HEARING NOW?
>> KEKEVIN CUENCA-- COSTS HAVE DEFINITELY GONE UP.
I DON'T KNOW IF THEY ARE TRIPLE, WHAT THEY ARE.
>> WHY WERE YOU UNHAPPY WITH THE $200,000?
IT IS A LOWER AMOUNT. >> DO WE REALLY FEEL LIKE IT IS
THAT MUCH OF A FLUCTUATION? >> I THINK SO.
>> MADAM CHAIRMAN? IF WE WILL, WE HAVE ELECTRIC ENGINEERING IN THE BACK HERE. HE MIGHT BE ABLE TO GIVE US MORE INSIGHT ON THAT. WE HAVE CRAIG.
WE WILL BE ABLE TO WRESTLE THAT, TOO.
>> WE HAVE LOTS OF PEOPLE. >> WE SURE DO.
>> I JUST ANSWERED THOSE QUESTIONS, YES.
[00:45:03]
THIS SORT OF AREA OF CABLE, THIS UNDERGROUND CABLE COVERS A FEW DIFFERENT SIZE THAT IS WE USE AT THE UTILITY.SOME HAVE DOUBLED IN PRICE. SOME HAVE TRIPLED IN PRICE.
WE HAVE LOOKED AT PROJECTS THAT ARE COMING IN NEXT YEAR.
WE HAVE PROJECTED THEM OUT THAT WE ARE LOOKING TO USE.
OBVIOUSLY, WE DON'T HAVE TO USE THAT ENTIRE $700,000 AMOUNT.
WE WOULD LIKE TO LIMIT THE AMOUNT OF TIMES WE HAVE TO COME BACK TO INCREASE THESE NUMBERS. THIS IS A HIGH-LEVEL OVERVIEW OF WHAT WE ARE EXPECTING TO SPEND NEXT YEAR.
THIS IS SORT OF THE MAX THAT WE ARE ANTICIPATING TO SPEND.
>> WE DEFINITELY HAVE THE $700,000 BUDGETED IN THERE TO
>> OKAY. THAT ANSWERS MY QUESTION.
>> YES. WHEN YOU SAY $700 TO BUDGETED, WE HAD $700,000 BUDGETED FOR UNDERSTOOD GROUND ELECTRIC CABLE? OR ARE WE PULLING MONEY FROM OTHER BUDGETS TO ACCOMMODATE FOR THE INCREASE?
>> THIS IS-- WE HAVE LOOKED AT OUR ANTICIPATED CAPITAL PROJECTS. AND THE ANTICIPATED CAPITAL SPENDING. WE ARE ANTICIPATING TO SPEND THAT $700,000. THIS WILL COME FROM THE CAPITAL BUDGET. THTHAT IS ALLOTTED TO THE
I SEE. SO IT IS BASICALLY GOING OUT OF MONEY THAT WAS BUDGETED FOR CAPITAL PROJECTS GOING INTO THE WAREHOUSE FOR THEM TO PURCHASE IT NOW AND THEN IT WILL GO BACK
ONCE IT -- >> I BELIEVE IT IS PURCHASED FROM THEIR BUDGET TO BRING IT INTO FPUAO.
AND FROM OUR CAPITAL BUDGET TO INSTALL THAT CABLE INTO THE
SYSTEM. >> HADED THE PROJECTIONS FOR THE AMOUNT OF UNDERGROUND CABLE THAT WE ARE GOING TO INSTALL CHANGED SINCE WE INITIALLY SET THE BUDGET?
AND IS THAT MOSTLY DUE TO US DOING STORM-HARDENING OR MORE DUE TO URBAN DEVELOPMENT PROJECTS?
>> URBAN DEVELOPMENT PROJECTS. >> OKAY.
>> YES, MA'AM. >> IT IS GROWTH.
OKAY. >> I KNOW THERE IS A COUPLE OF DIFFERENT TYPES OF CABLE THAT WE CAN INSTALL.
DIFFERENT INSULATION TYPES. IS THERE A SIGNIFICANT COST DIFFERENCE BETWEEN THE TWO MAY N INS INSULATION TYPES? AND HAVE WE CONSIDERED JUST STANDARDIZING ON THE LOWER-COST
ONE? >> WE HAVE STANDARDIZED ON THE LOWER COST ONE. THE MOST PREVALENT USED CABLE.
VERY LIMITED USES FOR THAT FOR OUR CABLE.
AND EXTREME LIMB LIMITED USES FOR THE MILLION OR THE 1,000 MCM CABLE THAT WE DO USE. WE HAVE STANDARDIZED THEM USING
>> MORE QUESTIONS? >> THANK YOU.
>> THANK YOU. >> MAKE A MOTION TO APPROVE.
>> SECOND. >> PLEASE CALL THE ROLL.
>> MRS. BENNETT? >> YES, MA'AM.
>> MR. LAMEDDERS? >> YES, MA'AM.
>> MAYOR HUDSON IN. >> YES, MA'AM.
[G.4. Bill Comparison for January 2023]
>> NEXT ITEM IS THE FPUA BILL COMPARISON FOR JANUARY, 2023.
ANDREA SLOAN, THE UTILITY ACCOUNTANT WILL MAKE THIS
PRESENTATION. >> THANK YOU, MR. HUTCHINSON.
MADAM CHAIR, MAYOR HUDSON, AND BOARD MEMBERS, I WILL BE PRESENTING THE MONTHLY UPDATE ON THE COMPARISONS OF LEAK TRIG RATES PUBLISHED BY FMEA AND THE LOCAL TREASURY COAST UTILITY BILLS FOR JANUARY. THIS GRAPH DEPICTS FPUA'S ELECTRIC RATES FOR 1,000 KILOWATT HOURS OF CONSUMPTION IN RELATION TO THE OTHER 12 PROJECT MEMBERS.
IT LIST IT IS MUNICIPALITIES BY RANK FROM LOWEST TO HIGHEST IN TERMS OF THE BASE BILL AMOUNT. FOR JANUARY, FPUA IS AT $155.48 AS INDICATED BY THE YELLOW BAR. WE HAVE MOVED UP THREE SPOTS SINCE DECEMBER. WE ARE NOW SIXTH FROM THE LEFT, WHICH INDICATES WE ARE LOWER THAN 7 OF THE OTHER MEMBER MUNICIPALITIES. THIS GRAPH DISPLAYS A COMPARISON FOR THAT SAME LEVEL OF CONSUMPTION.
IT INCLUDES ALL THE MUNICIPALITIES IN THE STATE.
FOR JANUARY, AGAIN, WE ARE AT $155.48.
AS SHOWN BY THE YELLOW BAR. OUR TOTAL RATE FOR A THOUSAND KILOWATT HOURS OF CONSUMPTION INCREASED $8 SINCE DECEMBER DUE TO THE PCA INCREASE. WE MOVED SIX SPOTS TO THE RIGHT WHEN COMPARED TO OUR POSITION LAST MONTH.
WE CURRENTLY RANK 23RD WHICH IS IN THE UPPER HALF OF THE
[00:50:03]
OTHER 32 MUNICIPAL UTILITIES. 11 OF THE YOU TILL I IT IS LISTED IMPLEMENTED INCREASES IN JANUARY.7 HAD DECREASES. 14 REMAINED UNCHANGED.
THESE CHANGES YIELDED AN ARP AVERAGE INCREASE OF $1.63.
AS A RESULT OF INVESTOR AND UTILITY PRICE INCREASES TAKING EFFECT, THE IOU AVERAGE INCREASED $16.5 FOR JANUARY.
IN COMPARISON TO THE ARP, IOU AVERAGES, FPUA IS LOWER THAN THE AVERAGE RATE BUT HIGHER THAN THE MUNICIPAL.
FPUA AS INDICATED BY THE YELLOW BAR, HAS A JANUARY BILL AMOUNT OF $391.67. THIS IS AN INCREASE OF $20 FROM THE PREVIOUS MONTH. AGAIN, DUE TO THE PCA INCREASE.
AT THIS CONSUMPTION LEVEL, WE MOVED UP FOUR SPOTS IN THE RANKS TO 24TH. THAT PLACES US IN THE UPPER HALF OF THE MUNICIPAL YOU TILL IS. AT THIS LEVEL, THE BASE RATE IS LOWER THAN THE ARP AND IOU AVERAGE BUT HIGHER THAN THE MUNICIPAL. THIS SLIDE DISPLAY IT IS COMPARISON OF AVERAGE UTILITIES BILLS FOR THE MONTH OF JANUARY.
THE COLUMN HIGHLIGHTED IN BLUE SHOWS FPUA'S UTILITY BILL, INCLUDING TAXES FOR INSIDE CITY-LIMIT CUSTOMERS.
THE OTHER COLUMNS REPRESENTING NEIGHBORING CITIES HAVE ELECTRIC SERVICE PROVIDED BY FPNL AND WATER WASTEWATER BY THE LOCAL KNEW MISPALTY. -- MUNICIPALITY.
THIS INCLUDES PFUA'S JANUARY POWER COST ADJUSTMENT INCREASE FOR ELECTRIC AS WELL AS FPNL'S RATE INCREASE.
THE SMALLER TABLE UNDERNEATH DEPICTS CUSTOMER BILL PRICING USING AVERAGES FOR THE MONTH OF JANUARY REMARKS THEY ARE THAN THOSE STANDARD CONSUMPTION RATES.
THOSE AVERAGES ARE AT 732 4,804 GALLONS FOR WATER.
SINCE THIS INFORMATION WAS LAST PRESENTED TO THE BOARD, THERE HAVE BEEN NO ADDITIONAL NEWS REGARDING LOCAL RATE CHANGES.
THIS ITEM HAS BEEN PRESENTED FOR YOUR INFORMATION ONLY AND REQUIRES NO ACTION. HOWEVER, IF YOU HAVE ANY QUESTIONS, I WOULD BE HAPPY TO ADDRESS THEM.
>> I HAVE A QUICK QUESTION. I DON'T RECALL LEESBURG AND GAINVILLE BEING SO HIGH ON THE 2500.
WAS THERE ANY ADJUSTMENTS MADE ON THEIRS? MAYBE THEY DIDN'T USED TO HAVE THAT.
OR I GUESS THAT RATE CHANGE OR WHATEVER THE CHARGE.
>> YOU SAID LEESBURG? I'M NOT SHOWING HAD ANY CHANGE FROM DECEMBER TO JAB. DECEMBER TO JANUARY.
WHAT WAS THE OTHER ONE? >> GAINESVILLE?
>> I'M NOT SHOWING A CHANGE WITH THEM EITHER.
TO THEIR RATES. THE LARGEST CHANGES WERE FROM
CHATTAHOOCHEE AND HAVANA. >> MADAM CHAIR?
>> YES, MA'AM. >> I WAS IN TALLAHASSEE LAST WEEK. THERE IS A BILL BEFORE THE LEGISLATURE THAT IS-- HAS A LOT TO DO WITH MUNICIPAL UTILITIES.
ABOUT THE TRANSFER TO THE CITY AND ABOUT THE TRANSFERRING OF THE REGULATION TO PSC. EVERY SINGLE LEGISLATOR SAID THAT THE LEGISLATION WAS DRIVEN BY THE SITUATION IN GAINESVILLE.
GRU. AND MAYBE OUR LEGAL COUNSEL CAN EMBELLISH A LITTLE BIT ON THIS. WE WERE TOLD THAT THIS-- WHAT I WOULD CONSIDER PUNITIVE NATURE OF THE LEGISLATION WAS GENERATED BECAUSE OF THE SITUATION IN GAINESVILLE.
WHICH IS APPARENTLY, THEIR RATES ARE VERY HIGH.
AND I THINK THEY HAVE INVEFSED IN A LOT OF SOLAR.
MAYBE YOU CAN TELL US MORE. >> ABSOLUTELY.
YEAH. I WAS GOING TO SAY THIS FROM MY REMARKS AT THE END. I'M HAPPY TO DO IT NOW.
AN UPDATE ON THE BILLS FIRST. YOUR UPDATE ON THE POINT ABOUT IT BEING SPARKED BY GAINESVILLE. I THINK THAT IS CORRECT.
IF YOU WATCH-- THERE IS A JOINT LEGISLATIVE OVERSIGHT COMMITTEE INVESTIGATION IN SPECIFICALLY TO GAINESVILLE.
SOME OF THE LEGISLATORS BEHIND THAT ARE THE ONES THAT ARE ALSO GAINESVILLE REPRESENTATIVES. THEY ARE REALLY FOCUSED ON COST AT GAINESVILLE. THERE IS A FEW ISSUES THERE.
A LOT OF IT HAS TO DO WITH THEIR BIOMASS PLANT.
IT HURT THEIR BOTTOM LINE A LOT. THAT IS ONE OF THE REASONS THAT THEIR RATES ARE VERY HIGH RIGHT NOW.
THTHEY ALSO HAVE SOME ISSUES WIH OUTSIDE OF THE CITY RESIDENTS
[00:55:01]
VERSUS INSIDE OF THE CITY RESIDENTS AND REPRESENTATION ON THE GAINESVILLE BOARD THERE. SO THERE IS JUST A LOT OF POLITICAL AND COST ISSUES GOING ON IN GAINESVILLE THAT IS SPURNING SOME OF THIS LEGISLATION.THE ORIGINAL LEGISLATION WHICH I REPORTED ON TWO OR THREE MEETINGS AGO, IT WANTED TO SUBJECT ALL OF THE MUNICIPALITIES, MUNICIPAL UTILITIES TO THE PUBLIC SERVICE COMMISSION JURISDICTION AND RESTRICT YOUR TRANSFERS TO THE GENERAL FUND. SINCE THEN, THEY HAVE REMOVED THE PART-- THEY HAVE COMPLETELY AMENNED THAT BILL.
THEY HAVE DELETED IT AND SUBSTITUTED IT WITH A NEW BILL.
THEY REMOVED THE PAR ABOUTST THE PUBLIC SERVICE JURISDICTION.
THAT PART HAS COME OUT OF THE CURRENT VERSION OF THE BILL.
IT GOES EVEN FURTHER WITH SOME LIMITATIONS ON TRANSFERS TO THE GENERAL FUND. WITH THE CURRENT VERSION, THERE IS ALSO THE HOUSE AND THE SENATE COMPANION BILL ON IT.
ACTUALLY, THEY ARE BOTH BEFORE COMMITTEES RIGHT NOW.
ONE BEFORE THE HOUSE COMMITTEE. ONE BEFORE THE SENATE COMMITTEE.
TAKING PLACE RIGHT NOW. I'M GOING TO BE HAPPY TO WATCH WHEN I GET BACK HOME AND SEE WHICH WAY THEY WENT.
BUT THE FOCUS OF BOTH OF THOSE BILLS ARE, AGAIN, RESTRICTING THE GENERAL FUND TRANSFERS. IT IS LOOKING TO TAKE FOR ALL MUNICIPAL ELECTRIC UTILITIES, LOOK AT THE INVESTOR-OWNED UTILITY AVERAGE RETURN ON EQUITY.
THAT IS A NUMBER THEY CALCULATE WHEN THEY DO THEIR RATE CASES AT THE PUBLIC SERVICE COMMISSION. AVERAGE THOSE IOU RETURN EQUITIES WHICH RIGHT NOW WOULD COME OUT TO A LITTLE BELOW 10%.
THAT WOULD BE A CAP ON MUNICIPAL ELECTRIC UTILITY TRANSFERS TO THE GENERAL FUND. THAT WOULD BE THE BASE LINE.
COULDN'T GO OVER THAT. THEN IT WOULD LOOK TO SEE ANY UTILITY THAT HAS OUTSIDE OF THE CITY CUSTOMERS, THEY WOULD RATCHET DOWN THE AMOUNT YOU CAN TRANSFER TO THE GENERAL FUND ON A PERCENTAGE BASIS OF YOUR OUTSIDE VERSUS INSIDE CITY CUSTOMERS. IT GOES TO 15%, TO 45%.
1.5% WOULD GET KNOCKED OFF OF THE CURRENT 10%.
IT CAPS AT THE 45. IF YOU HAVE 50% OF CUSTOMERS OUTSIDE OF THE CITY AND 50% INSIDE, THEY WOULD USE THE 45% NUMBER AND CAP, YOU KNOW, SO 4.5% WOULD COME OFF OF THE ABILITY TO TRANSFER TO THE GENERAL FUND.
THAT WOULD BRING YOU DOWN TO 5.5, 5.4% BASED ON TODAY'S NUMBERS. THAT WOULD CAP YOUR ABILITY TO TRANSFER TO THE GENERAL FUND. THE ONE EXCEPTION TO THAT IS IF YOU ARE A UTILITY AUTHORITY BOARD OR COMMISSION THAT IS ELECTED, AND YOUR ELECTED BOARD REPRESENTS BOTH INSIDE AND OUTSIDE OF THE CITY CUSTOMERS PROPORTIONATELY.
IF YOU HAVE A FIVE-MEMBER BOARD, AND YOU ARE AN ELECTED BOOR, AND TWO OF THEM REPRESENT JUST OUTSIDE OF THE CITY CUSTOMERS.
AND THAT EQUALS THE PERCENTAGE OF INSIDE AND OUTSIDE, YOU WOULD BE EXEMPT FROM THAT RATCHETING DOWN.
THE CAP WOULD STILL APPLY. THEY WOULD NOT RATCHET DOWN THE AMOUNTS. YOU WOULD HAVE AN ELECTED BOARD THAT REPRESENTS INSIDE AND OUTSIDE.
THERE WOULD BE NO PUNISHMENT FOR.
THAT RIGHT NOW, THERE IS ONLY ONE MUNICIPAL UTILITY IN FLORIDA THAT HAS AN ELECTED BOARD OR COMMISSION.
THAT IS KEY WEST. ONE OF THE FOCUSES, AND A LOT OF THE LOBBYING EFFORTS RIGHT NOW IS GOING TO BE ON THAT ISSUE.
AND TRYING TO EXPLAIN THAT THERE IS CURRENTLY ONLY ONE THAT IS ELECTED. A LOT OF UTILITIES DO THINGS TO INVOLVE AND TRY TO REPRESENT THE OUTSIDE OF THE CITY CUSTOMERS LIKE UTILITY ADVISORY BOARDS, UNELECTED BOARDS, WHERE MEMBERS ARE APPOINTED. AND THEY REPRESENT OUTSIDE THE CITY. THERE IS OTHER THINGS BEING DONE. THAT IS CURRENTLY WHERE THAT LEGISLATION IS AT. AGAIN, THIS IS BEFORE TWO COMMITTEES RIGHT NOW. ONE IN THE SENATE.
ONE IN THE HOUSE. WHAT WE ARE HEARING IS IT LIKELY WILL MOVE FORWARD OUT OF THOSE COMMITTEES.
IT DOES HAVE TRACTION. SO EVEN THOUGH THE FOCUS OF IT ORIGINALLY CAME OUT OF A GAINESVILLE ISSUE, THE TRACTION IS STILL APPLYING TO ALL MUNICIPAL UTILITIES.
BUT WILL BELY, LUCKILY, NOT AS MUCH ON THE PUBLIC SERVICE JURISDICTION. IT IS ON THE GENERAL FUND
TRANSFER. >> AND IS THE PORTION IN THERE STILL ABOUT THE SURCHARGE? THE SURCHARGE FOR CUSTOMERS
OUTSIDE THE JURISDICTION? >> THE PORTION IN THERE FOR --
>> IT WAS GOING TO BE LIMITED T- >> GAS.
YEAH. LET ME CHECK THAT ON THAT.
I DON'T WANT TO MISSTATE IT. I WILL LOOK AT IT.
IN THE ORIGINAL LEGISLATION, THEY WERE FOCUSING ON THAT AS WELL. I BELIEVE IN THIS ONE, THEY ARE RESTRICTING THAT TOS WATER, WASTEWATER AND NATURAL GAS.
LY NEED TO TAKE A LOOK AT THAT. >> OKAY.
THANK YOU FOR BRINGING THAT UP. >> THAT IS WHEN YOU BROUGHT UP GAINESVILLE AND MIL NOT REALIZIG IT, TRIGGERED THAT.
>> THERE ARE NEW TALKING POINTS FROM FMEA.
[01:00:01]
NEXT WEEK IS THEIR LEGISLATIVE RALLY UP IN TALLAHASSEE.THEY REVISED THE TALKING POINTS TO REFLECT THIS NEW BILL TO MAKE SURE THAT WHEN I KNOW JAVY WILL BE UP THERE, MEETING WITH THE LEGISLATORS, THAT YOU HAVE THE RIGHT TALKING POINTS.
AND THAT YOU KIND OF HIT A LOT OF THESE ISSUES.
AND EVEN THOUGH THE PSC JURISDICTION HAS BEEN TAKEN AWAY. HOW THAT RESTRICTION ON THE TRANSFER TO THE GENERAL FUND WILL IMPACT YOUR RATE PAYERS AND A LOT OF THE MUCH-NEEDED MUNICIPAL SERVICES YOU PROVIDE.
THAT THAT MONEY SUPPORTS. >> RIGHT.
>> RIGHT. >> YOU SHARE THAT WITH JAVY.
HE CAN SHARE IT WITH US? >> HE HAS A COPY OF IT.
I CAN SEND IT TO ALL OF YOU AS WELL.
IF YOU WOULD LIKE COPIES. >> DO THOSE RESTRICTIONS ON THE TRANSFERS, DO THEY APPLY TO ALL UTILITY CUSTOMERS?
OR ONLY ELECTRIC? >> IT IS ELECTRIC, WATER, WASTEWATER, AND GAS. ALL MUNICIPAL SERVICES.
>> ALSO THE REVENUE FROM EACH UTILITY.
>> THE PERCENTAGE IS BASED ON METER COUNT.
IF THAT IS WHAT YOU ARE ASKING. HOW THEY CALCULATE THE
PERCENTAGE INSIDE AND OUTSIDE. >> IT IS THE TOTAL METERS FOR ALL UTILITIES? NOT JUST FOR ELECTRIC.
>> I THINK THE DEVIL IN THE DETAILS IS HOW THEY IMPLEMENT SOME OF IT. YEAH.
WE WILL NEED TO WORK ON HOW THEY ARE GOING TO IMPLEMENT THAT AND SPLIT IT UP AMONG THE DIFFERENT UTILITIES.
>> AND THEN RIGHT NOW, THE CAP IS FOR THE AMOUNT OF TRANSFER-- WHAT IS THAT? THE RETURN OF EQUITY.
>> THE CURRENT ONE IS 9.9%. THE AVERAGE OF THE INVESTOR IN UTILITIES IN FLORIDA IS JUST BELOW 9.8%.
>> DO YOU KNOW, THE WAY THE LEGISLATURE IS PROPOSED NOW, IS IT WRITTEN SO IT WILL FLUCTUATE AS THAT NUMBER IS RECALCULATED?
>> YES. ON A YEARLY BASIS, IT WOULD FLUCTUATE BASED ON THE IOU RETURN ON EQUITY NUMBERS AND
THEIR RATE CASES. >> SOUNDS LIKE AN ACCOUNTING --
>> THEN YOU KNOW, THAT 9.9% WOULD COME DOWN.
BECAUSE WE HAVE CUSTOMERS THAT ARE OUTSIDE OF THE CITY LIMITS.
>> YES. >> DEPENDING ON THE RATIO.
>> AND HOW THEY ARE WEIGHTING THE CUSTOMERS.
THEY DON'T HAVE A CLEAR FORMULA AS OF YET.
THE ALTITUDE IS STILL A LITTLE HIGH ON IT.
>> YEAH. THERE IS A LOT OF QUESTION MA MARKS, I THINK, STILL IN THE LEGISLATION.
A GOOD EXAMPLE IS THIS ELECTED BOARD AND WHAT THAT MEANS.
YOU KNOW, IF YOU ARE APPOINTED BY ELECTED OFFICIALS, IS THAT GOOD ENOUGH? DO YOU HAVE TO BE ELECTED YOURSELVES? HOW THE PERCENTAGES WORK OUT WITH A FIVE-MEMBER BOARD. THE PERCENTAGE OF INSIDE AND OUTSIDE. YOU CAN SEE HOW IT WOULD BE DIFFICULT TO FIGURE OUT HOW MANY MEMBERS-- THERE IS A LOT OF DETAIL THAT HAS TO BE WORKED YOU.
>> LAST QUESTION ON THIS TOPIC. MR. HUTCHINSON, DO YOU HAVE AN IDEA OF WHAT THE PREMISE BEHIND THE SURCHARGE FOR OUTSIDE CITY
LIMIT CUSTOMERS IS? >> THERE IS A COUPLE OF DIFFERENT-- I HATE TO CALL THEM THEORIES.
WE HAVEN'T SEEN ANYTHING CONCRETE ON THAT.
THE WATER AND WASTEWATER UTILITY ITSELF WAS PRE-QUOSLY OWNED BY THE CITY OF FORT PIERCE. THE CITY OF FORT PIERCE RESIDENTS HAD INITIALLY CONSTRUCTED THAT CORE INFRASTRUCTURE. BEFORE IT EXPANDED BEYOND THE CITY LIMITS OF FORT PIERCE. THAT IS THE PREMISE THAT COMES
THE IDEA IS WE, AS A CITY, BUILT THIS UTILITY.
WE INVESTED A LO OF TAX DOLLARS INTO BUILDING IT OUT.
AND SO NOW THAT YOU GET A BENEFIT OF THE UTILITY OUTSIDE OF THE CITY LIMITS, YOU KNOW, YOUR PROPERTY NEVER PAID INTO IT, SO WE ARE TRYING TO RECOUP SOME OF THAT INITIAL INVESTMENT.
>> THAT IS MY UNDERSTANDING. >> I HAVE A LITTLE BIT TO ADD TO THAT, TOO, IF I COULD. THE OUTSIDE THE CITY SURCHARGE-- INSIDE OF THE CITY, YOU ARE ALLOWED TO CHARGE A MUNICIPAL PUBLIC SERVICE TAX. THAT IS TO RECOVER SOME COSTS YOU WERE JUST MENTIONING. FOR THE COSTS OF PROVIDING THOSE MUNICIPAL SERVICES. YOU CANNOT CHARGE THAT TO OUTSIDE OF THE CITY RESIDENTS. THE OUTSIDE THE CITY SURCHARGE WAS IMPLEMENTED IN ORDER TO BE ABLE TO CHARGE THEM A LIKE AMOUNT FOR PROVIDING THOSE SAME SERVICES.
IT NEEDS TO BE THE SAME AMOUNT. THE IDEA IS THAT EVEN THOUGH IT SOUNDS TO THOSE CUSTOMERS LIKE YOU ARE IMPOSING A TAX OR A SURCHARGE, IT IS NOT A GREAT NAME FOR IT.
BECAUSE REALLY WHAT YOU ARE DOING IS IMPOSING A LIKE AMOUNT OF YOUR PUBLIC SERVICE TAX WHICH YOU CAN'T CHARGE TO THEM IN ORDER TO RECOVER THE SAME COSTS THAT YOU CHARGE YOUR INSIDE THE
[01:05:02]
CITY CUSTOMERS. AND IT IS CAPPED AT THE SAME AMOUNT THAT YOU CHARGE FOR YOUR MUNICIPAL PUBLIC SERVICE TAX>> GREAT CLARIFICATION. >> WHEREAS BEFORE, I MAY HAVE LOOKED AT IT AS THIS IS AN UNFAIR CHARGE THAT WE ARE GIVING TO PEOPLE OUTSIDE OF THE CITY LIMITS.
REALLY IT IS TO FAIR IT UP. >> SO IT IS FAIR AND EXWITBLIN.
AND NOT THE OTHER WAY AROUND. >> YES.
>> SO YOU ARE SAYING THAT THE SURCHARGE FOR THE OUTSIDE NEEDS TO BE THE SAME AS THE ONES FOR IN THE CITY.
>> AS THE MUNICIPAL PUBLIC SERVICE TAX.
CHARGED IN THE CITY. YOU WON'T SEE A SEPARATE LINE YOU WILL SEE A LINE ITEM FOR MUNICIPAL PUBLIC SERVICE TAX IN
THE CITY. >> GOOD EXPLANATION OF IT.
>> 10%. >> THAT IS WHAT THE UTILITY TAXES. YES.
SO THAT IS BEING FAIR PERHAPS. MAYBE.
. >> OUR PREMISES WE WANT EVERYBODY TO PAY WHAT T THEIR FR SHARE.
WHAT THEY ARE SUPPOSED TO PAY. NOBODY PAYS MORE OR LESS.
RIGHT? WE ARE EVEN TRYING TO DO THAT WITH THE UTILITY. CORRECT?
>> YES, WE ARE. >> WHATEVER UTILITY YOU USE, THE CHARGE SHOULD BE EQUAL AND SUSTAINABLE SO-- YEAH.
>> AND SO IN THE CITY, WE ARE CHARGING 10%.
>> YES. >> AND SO OUT OF THE CITY, WE
ARE CHARGING 10% AS WELL. >> RIGHT, RIGHT.
>> IT IS A DIFFERENT LINE' THEM. >> YUP.
ANY FURTHER QUESTIONS? >> VERY GOOD.
[Items G.5 & G.6]
>> OKAY. SO WE WOULD LIKE TO TAKE THE NEXT TWO ITEMS TOGETHER. G-5 AND G-6.
THAT IS THE SEPTEMBER, 2022 QUARTERLY FINANCIAL.
AND THEN ALSO THE ANNUAL COMPREHENSIVE FINANCIAL REPORT.
MISS MICAH WILL PRESENT THIS ITEM AS WELL.
>> THANK YOU, MR. HUTCHINSON. AND GOOD AFTERNOON, MADAM MAYOR, MADAM CHAIR AND BOARD MEMBERS. WE HAVE COME TO THE CLOSE OF ANOTHER FISCAL YEAR, AND I WOULD LIKE TO PROVIDE YOU WITH THE REVIEW OF THE FINANCIAL OPERATING RESULTS FOR THE FISCAL YEAR ENDED SEPTEMBER 30, 2022. THE INFORMATION BEING PRESENTED IS THE SAME AMENDING THE FINAL BUDGET OF THE FPUA AS WELL AS FOR THE ANNUAL COMPREHENSIVE FINANCIAL REPORT.
ADDITIONALLY, YOU HAVE RECEIVED THE QUARTERLY OPERATIONAL OPERATING INFORMATION FOR SEPTEMBER.
THAT IS THE BLUE BOOKLET. FOR SEPTEMBER, 2022 WHICH PROVIDES A GREAT DETAIL OF SUMMARY ON THE INDIVIDUAL OPERATING SYSTEMS, THE RESULTS FOR THE INDIVIDUAL SYSTEMS. THE FINAL BUDGET AMENDMENT REPRESENTS THE FINAL ACTUAL RESULTS IN THAT POSITION FOR FISCAL YEAR 2022.
AND THIS SLIDE COMPARES THE ACTUAL FINAL NUMBERS TO THE NUMBERS THAT WERE AMENDED WITH THE BUDGET.
LAST SUMMER. THE FINAL BUDGET BROUGHT AN INCREASE OF $4.4 MILLION, MAINLY AS A RESULT OF SALES REVENUE FOR ALL SYSTEMS AND GRANT REVENUE RECEIVED FOR THE SEWER MAIN LINING OF $1.9 MILLION. IN COMPARISON TO THE AMENDED BUDGET, FINAL REVENUES CAME IN ABOVE THE AMENNED EXPECTATION BY $1.9%. RELATED EXPENSES WERE LOWERED BY 1.2%. THE MAIN COMPONENTS FOR THE LOWER-THAN-EXPECTED OPERATING EXPENSE CAME THROUGH LOWER COST OF PURCHASE POWER. THIS IS COMPARED TO BUDGET NOW.
POWER-- PURCHASE POWER AND GAS OF $5 MILLION.
PROFESSIONAL AND PERSONNEL SERVICES WERE LOWER AS WELL.
THESE SAVINGS WERE OFFSET BY AN ACTUAL LIABILITY OF $4.1 MILLION FOR THE FISCAL YEAR. SOME OF THE YEAR-TO-DATE CHANGES
[01:10:07]
THAT WE EXPERIENCED IN FISCAL YEAR '22 OVER THE PREVIOUS YEAR WERE IN OUR YEAR-TO-DATE OPERATING INCOME.IT WAS LOWER IN FISCAL YEAR '22 BY $6.1 MILLION.
THE OPERATING REVENUE INCREASED BY $23.7 MILLION.
THE GAINS WERE OFFSET THROUGH HIGHER EXPENSES IN THE FISCAL YEAR. OPERATING EXPENSES TOTALING $122,493,000 WERE GREATER IN FISCAL YEAR, 2022 BY $29.9 MILLION OVER THE PRIOR YEAR. THAT WAS PRIMARILY RESULT OF THE INCREASE IN ACTUAL EXPENSE OF PURCHASE POWER.
YOU HAD GRANT REVENUE THAT INCREASED FOR FISCAL YEAR, 2022 THAT ADDED A TOTAL GAIN TO OUR NET POSITION WITH AN INCREASE OVER LAST YEAR OF $1.9 MILLION. AND CLOSING OUT THE YEAR, WITH THIS LOOK AT THE YEAR OVER YEAR CHANGES, IN OUR FINANCIAL PICTURE, WE HAVE ADDED $4.4 MILLION.
$4.3 77,000 FOR OUR NET POSITION FOR THIS FISCAL YEAR.
THE NEXT FOUR SLIDES IS WHERE WE LOOK AT THE YEAR OVER YEAR COMPARIONS AND FOR THE REVENUE AND ASSESS THE REASONS FOR THE CHANGES THE CONSUMPTION IN REVENUE THAT IMPACTED THE CHANGE YEAR OVER YEAR. IN THE QUARTERLY BOOK, I KNOW THIS WAS A QUESTION THAT WAS BROUGHT UP AT THE LAST MEETING, OUR COMPARISON OF CONSUMPTION ON THE SYSTEMS FROM NOW TO THE PREVIOUS YEAR. THAT IS PART OF THE QUARTERLY STATEMENT IN THE BLUE BOOK. IT IS THE LAST FOUR PAGES.
IN THAT, YOU CAN SEE THE CURRENT MONTH AND THE YEAR-TO-DATE CHANGES IN THE CONSUMPTION NUMBERS AND THE COMPARATIVE NUMBERS FOR THE SAME PERIOD LAST YEAR.
CURRENT YEAR LAST YEAR. THOSE GO INTO OUR QUARTERLY STATEMENTS WHEN WE DO THEM EVERY YEAR.
YOU HAVE THE SEPTEMBER NUMBERS THERE.
FISCAL YEAR, 2022, ELECTRIC OPERATING REVENUES EXCLUDING THE COST OF POWER, INCREASED 8.9% FROM FISCAL YEAR, '21.
ACTUALS. THE NET OPERATING REVENUES FOR THE ELECTRIC SYSTEM WERE UP SLIGHTLY FROM FISCAL YEAR '21.
BY $2.1 MILLION. THIS INCREASE IN REVENUES, NET OF COST IN THE ABSENCE OF INCREASED CONSUMPTION WAS THE RESULT OF THE RATE ADJUSTMENTS IMPLEMENTED IN 2022.
WE HAD SEVERAL RATE ADJUSTMENTS. ELECTRIC PURCHASES FOR RESALE WERE $17,680,000 GREATER THAN THE PRIOR YEAR.
THAT WAS SIMPLY A RESULT OF THE INCREASED GAS COST THAT WE HAVE BEEN TALKING ABOUT AND SEEING THE IMPACT ON OUR POWER BILL.
FISCAL YEAR, 2022, OPERATING REVENUE UP 5.6%.
CONSUMPTION WAS UP .6%. FROM FISCAL YEAR '21.
WHILE THAT CONSUMPTION WAS RELATIVELY FLAT FROM LAST YEAR, THE ACTUAL INCREASE IN WATER REVENUES RELATES AGAIN TO THE RATE ADJUSTMENTS IMPLEMENTED LAST YEAR IN NOVEMBER.
NOVEMBER AND IN JULY FOR WATER. WASTE WEARS, THE WASTEWATER REVENUES WERE UP 5.5% FROM FISCAL YEAR, '21.
ACTUALS. THE UNITS, AGAIN, REMAINED FLAT.
THE WASTEWATER UNITS BILL TYPICALLY FOLLOWS THE SAME PATTERN AS WATER SALES. IN THE FISCAL YEAR, '22, BOTH SYSTEMS CONSUMPTIONS REMAINED FLAT.
OUR NATURAL GAS OPERATING REVENUES, LESS THE COST OF GAS WAS HIRED BY-- HIGHER BY 4% FROM FISCAL YEAR '21 ACTUALS.
LIKEWISE, IT DID SHOW AN INCREASE IN CONSUMPTION OF 1.4% LAST YEAR. THE COST OF GAS PURCHASES FOR RESALE FOR FISCAL YEAR 2022 WAS 78.3% HIGHER THAN YEAR BEFORE.
THE COST OF NATURAL GAS WAS ABOUT $1.5 MILLION HIGHER THAN WE PAID LAST YEAR THAN THE PREVIOUS YEAR.
FISCAL YEAR, '22 BROUGHT INCREASES BASED ON DIFFERENT SOURCES. BASED ON THE-- WE HAD INCREASES EARLIER ON IN NOVEMBER. THE PUBLIC SERVICE COMMISSION INDEX. WE HAD INCREASES FOR RATE EFFICIENCY IN JULY. AND SOME INCREASES WERE AS A
[01:15:01]
RESULT OF THE BOND ISSUANCE. THE RATE ADJUSTMENTS FOR THE PAST TEN YEARS CAN BE FOUND IN THIS BOOK, IN THE STATISTICAL SECTION. THERE IS A LOT OF INFORMATION.ON PAGE 86, YOU CAN SEE TEN YEARS, AND THE REASONS WHY WE HAD THOSE INCREASES AND WHAT SYSTEMS THEY WERE FOR.
SO I ENCOURAGE YOU TO LOOK AT THAT.
AND IN FISCAL YEAR, 2022, OUR OPERATING AND MAY NOT FINANCE CONDITIONS OUR OPERATION AND MAINTENANCE WAS BELOW THE AMENNED BUDGET. WE WERE 31% HIGHER THAN THE PREVIOUS YEAR. ACTUALS.
THIS IS PRIMARILY DUE TO THE COST OF PURCHASE POWER FROM FMPA. OUR AMENNED BUDGET, WE MADE ADJUSTMENTS, ANTICIPATING THE COST OF PURCHASE POWER TO BE HIGHER AS WE CLOSED OUT 2022. ELECTRIC PURCHASES FOR RESALE WERE $4 MILLION BELOW THE AMENDED BUDGET.
OF THE AMENDED PROJECTION. $17.8 MILLION HIGHER THAN FISCAL YEAR 2021. OUR GAS PURCHASES FOR RESALE WERE $1.5 MILLION GREATER IN 2022.
AS WELL AS JUST IN GENERAL, THE INCREASE IN EXPENSES IN THE SYSTEM'S OPERATIONS WERE ROUGHLY BETWEEN $15% AND 25%.
INCREASED COST. THIS SLIDES SHOWS THE TREND IN THE CALCULATION OF THE DEBT SERVICE COVERAGE RATIO.
THIS CALCULATION IS A RATIO OF A ROLLING 12 AMONGST AVERAGE-- 12 MONTHS AVERAGE OF THE NET AVAILABLE INCOME.
OUR CURRENT DEBT SERVICE. FOR THE 12 MONTHS ENDING SEPTEMBER 30, 2022. OUR DEBT SERVICE RATIO WAS 2.7 TIMES COMPARED TO 3.54 TIMES AT THE END OF SEPTEMBER OF THEIOUS YEAR. IN 2021.
OUR BOND COVENANTS REQUIRE THAT WE HAVE A RATIO OF 1.25 TIMES.
AND SEPTEMBER 30, WE ARE IN COMPLIANCE WITH THAT INNOCENT.
THE COMPUTATION AND A TEN-YEAR TREND ON DEBT SERVICE COVERAGE CAN BE FOUND IN THE STATISTICAL SECTION AS WELL IN THE ANNUAL FINANCIAL REPORTS. THAT IS ON PAGE 89.
THAT IS THE BACK SECTION. ADDITIONALLY, AS OUR MASTER BOND RESOLUTION NUMBER 2022-10, ON SEPTEMBER 30 OF EACH YEAR, FPUA MUST MAINTAIN 45 DAYS OF CASH ON HAND TO REMAIN IN COMPLIANCE WITH THE RESOLUTION. THE CALCULATED DAYS ON HAND ON SEPTEMBER 30 BUSINESS 76 DAYS. INCLUDING ANY NON-CASH OPERATING EXPENSES. DISTRIBUTION TO THE CITY IS BASED UPON THE CALCULATION OF REVENUES SUBJECT TO THE 6% DISTRIBUTION. AND THIS FISCAL YEAR, 2022, WAS CALCULATED AT $6,758,426. THIS IS UP 3.6% OVER THE AMOUNT CALCULATED FOR 2021. WHICH WAS PAID LAST YEAR.
THE CALCULATION CAN BE FOUND IN THE ANNUAL FINANCIAL REPORT ON PAGE 60. THIS GRAPH PROVIDES YOU WITH A BIT OF HISTORY SO YOU CAN SEE THE STEADY TREND.
AS WE SPOKE ON THE PREVIOUS SLIDES WITH'M OF THESE SYSTEMS, REVENUES WERE UP FOR 2022. THOSE HIGHER REVENUES HAVE ADDED $234,000 TO THE DISTRIBUTION CALCULATION FOR THIS YEAR.
I AM HERE THIS EVENING SEEKING APPROVAL WITH THE INFORMATION THAT HAS BEEN PRESENTED REGARDING THE AUDITED FINANCIALS REPORT OF THE FISCAL YEAR ENDED SEPTEMBER 30, 2022.
AS BEING THE UNMODIFIED OPINION OF THE AUDITORS, THAT FPUA'S FINANCIAL STATEMENTS FOR THE FISCAL YEAR ENDING SEPTEMBER 30, 2022 ARE PRESENTED IN ACCORDANCE WITH GENERALLY ACCEPTED ACCOUNTING PRINCIPLES. AND TO ASK FOR THE... TO PERMIT THE FILING OF THE AUDIT WITH THE CITY OF FORT PIERCE, PLACING ON RECORD WITH THE CITY CLERK'S OFFICE, PURSUANT TO THE CITY CHARTER. IF YOU HAVE ANY QUESTIONS, I
WOULD BE HAPPY TO ADDRESS THEM. >> QUESTIONS?
>> I HAVE A QUESTION, AND IT MAY SOUND SILLY.
OBVIOUSLY, WE MADE SOME EXTRA MONEY.
IS THERE SOME-- I DON'T KNOW-- I APOLOGIZE.
I NEED TO SPEND SOME MORE TIME WITH YOU, TOO.
TRANSFERRING THAT INTO OUR PCA FUND OR ANY OF THAT? I DON'T KNOW HOW-- IF THAT IS ALLOWABLE OR-- WE HAVE EXTRA
[01:20:07]
FUNDS. FROM LAST YEAR.IT LOOKS LIKE. CORRECT? $4 MILLION. WE MADE MORE THAN EXPECTED.
AND I MAY BE WRONG. I DID REMEMBER SEEING THAT WE ALSO HAD AN INCREASE IN OUR PENSION FUND.
>> PENSION LIABILITY WENT UP. WE HAD A $4 MILLION ADJUSTMENT.
>> SO IT IS ALMOST A WASH. OKAY.
WELL, MY QUESTION IS NEGATED, THEN.
>> THAT WOULD NET OUT THE $4 MILLION.
THAT HAS BEEN ACCOUNTED FOR. >> RIGHT.
OKAY. >> WASN'T THE INCREASE IN REVENUES USED TO PAY FOR THE INCREASE IN --
>> YES. YOU KNOW, THE INCREASE IN COST.
YOU KNOW, ACROSS THE BOARD, EACH OF THE SYSTEMS, THEIR EXPENSES WERE UP. OPERATIONS, ADMINISTRATION.
IT IS COSTING MORE TO RUN. SOME OF THE ADJUSTMENTS WE MADE WERE RATE SUFFICIENCY ADJUSTMENTS.
YOU KNOW, THAT IS WHERE THE EXTRA REVENUE CAME FROM.
IT IS ALL GOING TO NET OUT. >> IT WILL SUPPORT THE UTILITY
AND THE DEBT SERVICE. >> IT ISN'T SITTING AROUND DOING ANYTHING. IT IS NOT EXCESS FUNDS.
IT IS FUNDS WE NEED FOR WHAT WE SAID WE WERE GOING TO SPEND THE MONEY ON. YES.
>> MADAM CHAIR? CAN YOU REMIND ME AGAIN WHAT OUR
MINIMUM DAY'S CASH ON HAND IS? >> BASED ON THE BOND CAVNANT? 45 DAYS. THAT IS REQUIRED.
>> YOU SAID WHAT YOU REPORTED ON JUST NOW WAS 76 DAYS?
>> YES. >> DO WE HAVE A TARGET DAY'S CASH ON HAND THAT WE LIKE TO STAY AROUND?
>> BEST PRACTICE IS 90 DAYS. AND WE WERE THERE ONCE.
>> WOW KNOW,-- YOU KNOW, WE ARE TRYING TO KEEP EVERYTHING ABOVE THE 45. 60 DAYS WOULD BE GREAT.
THAT IS TWO MONTHS. THAT IS CONSERVATIVE, TOO.
THE 76 DAYS IS CONSERVATIVE. WWE HAVE TAKE AN LOOK AT THE DAS OF CASH. AND THE BOND COVENANT.
CALCULATION GIVES US A CALCULATION THAT REQUIRES MORE THAN WE WERE LOOKING AT IT WITH. WE WERE LOOKING AT IT LIKE A $265 THOUSAND IN A DAY. IT IS MORE THAN THAT NOW.
THIS 76 IS MORE IN LINE WITH. THAT MORE CONSERVATIVE.
THAT IS ALL FOR ME. >> BETTER THAN THE TWO MONTHS.
>> YOU DON'T NEED APPROVAL FROM US YET.
THAT WILL BE IN THE RESOLUTION. CORRECT?
>> WE COULD DO IT WHEN I BRING RESOLUTION.
I JUST NEED TO-- YEAH. WE NEED YOU TO ACCEPT THE AUDIT AND I GUESS, THE RESOLUTION IS THE FINAL BUDGET AMENDMENT.
>> RIGHT. ACCEPTING THE AUDIT NEEDS A MOTION AS WELL. SEPARATEMENT.
>> CAN I GET A-- I MAKE A MOTION TO ACCEPT THE AUDIT FOR 2022.
>> SECOND. >> PLEASE CALL THE ROLL.
>> MRS. BENNETT? >> YES, MA'AM.
>> MR. LAMMERS? >> YES, MA'AM.
>> MAYOR HUDSON? >> YES, MA'AM.
>> MRS. GIBBONS? >> YES, MA'AM.
>> THANK YOU. >> THANK YOU, BARBARA.
[G.7. Board Attorney Discussion]
OKAY. THE LAST ITEM ON THE BUSINESS AGENDA HERE, NEW BUSINESS. AN UPDATE AND A LITTLE DIRECTION TO STAFF ON THE BOARD ATTORNEY SEARCH.>> WE HAVE TO DO THIS? >> WELL, I HAVE THIS AS NEW BUSINESS. WE COULD JUMP TO THE RESOLUTIONS IF YOU WOULD RATHER DO THAT FIRST.
>> I'M THE B TEAM. (LAUGHTER).
THAT AS OF NOW, THERE IS ONE CANDIDATE THAT'S BEEN INTERVIEWED BY THE BOARD AND ALSO SOME OF THE STAFF MEMBERS AS WELL. THERE WAS SIX TOTAL APPLICATIONS THAT ARE IN. I BELIEVE ALL THAT INFORMATION HAS BEEN FORWARDED TO THE BOARD. IT IS UP TO THE BOARD, IF YOU WOULD LIKE TO MOVE FORWARD WITH THE CANDIDATE THAT YOU HAVE INTERVIEWED. IF YOU ARE COMFORTABLE WITH THAT. IT IS MY UNDERSTANDING WE ARE ABLE TO MOVE FORWARD WITH JUST INTERVIEWING THE ONE CANDIDATE.
OR IF YOU WOULD PREFER, IF THERE IS SOMEONE ELSE THAT PIQUES YOUR INTEREST IN THERE, WE CAN CERTAINLY START SETTING UP THOSE
INTERVIEWS LIKE WE DID BEFORE. >> AT OUR LAST MEETING, I BELIEVE WE HAD ASKED EVERYBODY TO SEND TO JAVIER, IF THERE WAS ANOTHER CANDIDATE THAT WAS NEEDING TO BE INTERVIEWED, AND AS OF LATE, I DON'T BELIEVE THAT THERE WAS --
>> NOT TO MY KNOWLEDGE, NO. >> RIGHT.
I DON'T KNOW. LET'S OPEN IT UP A LITTLE BIT AND HAVE A DISCUSSION ABOUT THE CANDIDATE WE ALL DID INTERVIEW.
>> WE ALL INTERVIEWED THE SAME CANDIDATE.
(LAUGHTER). I DON'T THINK THERE NEEDS TO BE MUCH DISCUSSION. UNTIL WE KNOW EXACTLY HOW
[01:25:03]
INTERESTED SHE IS. WE KNOW SHE IS INTERESTED.AND SHE DEFINITELY, BY RESUME, CHECKS ALL THE BOXES.
I SPOKE TO HER EMPLOYER. HE SPOKE VERY HIGHLY OF HER.
MY INTERVIEW WENT VERY, VERY WELL.
I THINK SHE BRINGS WITH HER A VERY WELL-ROUNDED SKILL SET.
AND MORE IMPORTANTLY, A GOOD NETWORK OF CONTACTS, BOTH WITH THE CITY AND THE COUNTY, THE CITY OF PORT ST. LUCIE.
THAT IS INVALUABLE. TO FIND SOMEBODY WHO CHECKS ALL THE BOXES AND TO HAVE THAT NETWORK IN PLAY, I DON'T THINK ANY OTHER CANDIDATES DO. SO I'M-- YOU KNOW, IF IT WAS UP TO ME, I WOULD SAY START KNOCKING ON HER DOOR TONIGHT.
AND START OPENING UP NEGOTIATIONS BECAUSE THE COUNTY MAY PUT AN OFFER ON IT. LET'S HOPE SHE IS LOOKING FOR A NEW CHALLENGE. AND LOOKING TO BUILD SOMETHING A LITTLE BIT NEW. I THINK SHE WOULD REALLY, YOU KNOW, FILL THE SHOES OF KOBI QUITE WELL.
I MEAN, HE HAS 50 YEARS OF LEGAL EXPERIENCE AND 50 YEARS OF CONTACTS. YOU KNOW, NO ONE COULD FILL THOSE SHOES REALLY. SHE IS WELL ON HER WAY.
I LIKE HER. I THINK WE SHOULD OPEN UP NEGOTIATIONS. SEE IF WE CAN'T GET THIS LOCKED
DOWN BEFORE APRIL. >> MR. LAMMERS?
WE DEFINITELY HAVE A STRONG CANDIDATE RIGHT NOW.
THAT BEING SAID, IT WOULD BE TOUGH FOR ME TO MAKE THAT DECISION WITHOUT AT LEAST GIVING A REAL HONEST CONSIDERATION FOR AT LEAST ONE, MAYBE TWO MORE OPTIONS.
AT A MINIMUM, AT LEAST ONE MORE OPTION.
INTERVIEWING ANOTHER APPLICANT. I KNOW IF I WAS NOT IN THE DECISION-MAKING POSITION, I BUT I HAD A VESTED INTEREST ON WHO GOT INTO THIS POSITION, I WOULD WANT THAT TO BE DONE.
FOR THERE TO BE OTHER OPTIONS HONESTLY CONSIDERED.
SO THAT IS MY OPINION. AT LEAST ONE OTHER OPTION.
ONE OTHER APPLICANT BE INTERVIEWED.
>> I AGREE WITH MR. FEE. SHE WAS WELL-ROUNDED AND SHE SPOKE VERY HIGHLY OF ALL THE DIFFERENT CITIES AND THE DIFFERENT PEOPLE THAT SHE WORKED WITH.
AND ALSO ONE THING THAT STRUCK MY ATTENTION IS THAT SHE IS READY AND WILLING TO GET OUT IN THE COMMUNITY AND LEARN THE COMMUNITY, LEARN WHAT, YOU KNOW, IS NEEDED IN OUR COMMUNITY AND ACTUALLY WORK ALONG WITH US TO HELP, YOU KNOW, BRING FORT PIERCE WHERE IT NEEDS TO BE. SO I MEAN, SHE WAS REALLY, REALLY GOOD AT PRESENTING HERSELF, AND SHE ACTUALLY HAS A LOT OF EXPERIENCE THAT I'M VERY INTERESTED IN.
>> MAYOR? >> SO THE PEOPLE WHO WORKED WITH HER AT THE CITY HAVE VERY, VERY HIGH-- GIVE HER HIGH MARKS IN TERMS OF GETTING THE JOBS DONE THAT THEY NEED TO HAVE DONE.
ONE PERSON TOLD ME THAT SHE HAD AN INCREDIBLE WORK PRODUCT.
A LOT OF WORK PRODUCT. QUANTITY AND QUALITY.
FIRST-CLASS. AND THAT IS-- THAT SAYS LOT BECAUSE, YOU KNOW, PEOPLE ARE CONSTANTLY DEMANDING THE ATTORNEY FOR ORGANIZATIONS LIKE THIS, YOU TAKE MY PROJECT, I NEED TO HAVE YOU DO THIS. YOU HAVE TO JUGGLE A LOT OF REQUESTS, AND MY SENSE OF HER WHEN I TALKED TO HER WAS SHE WAS EXCITED FOR THE NEW CHALLENGE. I THINK MR. FEE WAS RIGHT.
SHE WAS REALLY EXCITED. SHE HAS DONE TWO CITIES NOW IN THE COUNTY. RIGHT? AND SO SHE HAS, SHE HAS ALL THE INFORMATION AND THE KNOWLEDGE THAT YOU HAVE IN TERMS OF THE SUNSHINE LAW.
ALL THOSE THINGS. SHE IS VERY SENSITIVE TO ALL THOSE THINGS. AND THAT IS SOMEBODY THAT IS IN THAT FIELD. AND I STRUGGLED WITH THE FACT THAT I THINK SHE IS THE ONE AND THE FACT THAT I FEEL LIKE IF I GO THROUGH THE MOTIONS OFFER INTERVIEWING SOMEBODY ELSE OE LG THERE ISN'T SOMEBODY, YOU KNOW, THAT IS ON THAT LIST, THAT IT WOULD BE RAISING FALSE EXPECTATIONS.
[01:30:03]
BECAUSE IN MY MIND, I HAVE SETTLED ONLY HER.SO I UNDERSTAND WHAT MR. LAMMERS IS SAYING.
AND I KIND OF WRESTLED WITH THAT, TOO.
AT THE SAME TIME, I KNOW WHEN WE WERE LOOKING FOR A CITY ATT ATTORNEY, WE WENT OUT FOR-- WE HAD ATTORNEYS FROM THE OUTSIDE COME IN. WE HAD TWO IN-HOUSE CANDIDATES.
AND WE HIRED THE IN-HOUSE CANDIDATE THAT IS THERE NOW.
AND IN RETROSPECT, I'M THINKING THAT THOSE OTHER CANDIDATES WHO PUT TOGETHER THEIR RESUME, CAME AND WERE-- YOU KNOW, PUT THEMSELVES UP, CAME IN AND IN AN OPEN FORUM, I JUST REGRETTED THAT WE DID IT THAT WAY. ALTHOUGH I WASN'T-- WE DID IT THAT WAY. SO AT ANY RATE, I FEEL STRONGLY THAT WE HAVE THE CANDIDATE WE WANT.
AND TO INTERVIEW SOMEBODY ELSE, I FEEL LIKE, IS NOT FAIR TO THAT
PERSON. >> I DON'T THINK IT IS NECESSARY TO INTERVIEW ANYMORE. UNLESS SHE TURNS IT DOWN.
IF WE CAN'T MAKE THE DEAL WORK. >> THE TIMING --
>> WE COULD ALWAYS OPEN IT UP AND RE-INTERVIEW.
I DON'T THINK THERE IS ANY ISSUE THERE ON THAT REGARD.
SHE JUST BRINGS HER WITH A SKILL SET AND NETWORK THAT THE OTHER CANDIDATES JUST DIDN'T V. THERE WAS ONE THAT WAS CLOSE, BUT HE IS GOING TO HAVE TO SPEND A COUPLE OF YEARS BUILDING TRUST BETWEEN THE CITY, THE COUNTY, AND OTHER-- I LIKE THE FACT THAT SHE HAS A VERY GOOD REPUTATION WITH ALL THE PEOPLE SHE HAS WORKED WITH. THAT IS SOMETHING THE UA. CAN LEVERAGE AND BUILD ON. I WOULDN'T WANT TO WASTE ANY MORE TIME. YOU THEY HAVE KNOW.
I THINK SHE DID VOLUNTEER, SHE DID PUT SOME RESUMES OUT THERE WITH OTHER LAW FIRMS. BUT SHE IS SERIOUSLY CONSIDERING THIS MORE THAN THEM. AND GIVE IT TIME.
ONE OF THOSE OTHER LAW FIRMS MIGHT LOOK AT IT AND SAY, LISTEN, SHE'S GOT SOMETHING HERE.
THEY MOST LIKELY WOULD BE ABLE TO BEAT OUR OFFER.
BUT WE HAVE TO SEE WHAT SHE IS GOING TO TAKE FIRST.
IF. >> I THINK THE TIMING IS LIKE YOU SAID, IMPORTANT. ALSO THE COUNTY COULD, AS YOU SAY, SWEETEN THAT POT BECAUSE THEY HAVE A LOT OF CHANGES GOING
I THINK THAT SHE IS GENUINE. I TRULY THINK THAT SHE WOULD BE A GREAT ADDITION NOT JUST FOR THE FPUA BUT ALSO FOR THE DIRECTORS AND A GOOD PARTNER FOR MR. CISNEROS.
I THINK SHE IS-- SHE WANTS TO COME FOR THE RIGHT REASONS.
I THINK THAT SHE IS HIGHLY EQUIPPED WITH WHAT SHE NEEDS TO DO IN THIS POSITION. AND NOT ONLY, YOU KNOW, TALKING ABOUT MUNICIPALITIES BUT ALSO CORPORATE LAW.
AND I KNOW WE ARE NOT A CORPORATION.
BUT WE ARE A BUSINESS. AND TO HAVE SOMEBODY WITH THAT HISTORY AND WITH THAT ASTUTE KNOWLEDGE, I THINK, WOULD BE BENEFICIAL FOR US. I THINK THAT-- I AGREE WITH YOU.
I ALSO WRESTLED WITH THE SAME, YOU KNOW, CONCERN.
DO WE NEED TO JUST GO THROUGH THE MOTIONS? I'M MORE CONCERNED ABOUT WALKING IN WITH MY EXPECTATION ALREADY SET AND NOT BEING ABLE TO DO JUSTICE FOR THE PERSON THAT IS
INTERVIEWING. >> I AGREE WITH EVERYTHING THAT WAS JUST SAID. I REALLY DO.
I'LL GO BACK TO A COMMENT I MADE ABOUT WHEN I MENTIONED THAT MAYBE WE SHOULD LOOK AT RAISING THE SIGNATURE AUTHORITY.
AND THAT IS THAT I TRIED TO FAST-FORWARD 20 YEARS, AND IF WE WERE DOING THE EXACT SAME-- IF WE SET RULES IN PLACE OR SOME PRECEDENT IN PLACE, HOW DOES THIS PROCEDURE WORK IF WE TAKE OUR GUT FEELINGS, OUR EXPERIENCE WITH THIS ONE INTERVIEW OUT OF THE SITUATION AND WHAT IF IT WEREN'T FIVE BOARD MEMBERS WHO WANT THE BEST THING FOR THE UTILITY, RIGHT? AND ARE CONFIDENT THAT THE PERSON WE HAVE INTERVIEWED IS THE BEST THING FOR THE UTILITY. WHAT KIND OF PRECEDENTS ARE WE SETTING IF IT IS SOMEONE WHERE THERE IS SOME KIND OF NEPOTISM OR SOME OTHER DIRTY WORD THAT GETS THROWN AROUND IN THE PUBLIC EYE. RIGHT? IF THERE WAS SOMETHING LIKE THAT AT PLAY, WHAT DOES THIS PROCEDURE THAT WE ARE FOLLOWING LOOK LIKE TO THE PUBLIC? I 100% AGREE. THIS PARTICULAR SITUATION, I THINK IT IS GOING TO TURN OUT-- THIS IS PROBABLY THE BEST THING FOR THE PUBLIC. HOW DOES IT LOOK IN A DIFFERENT SCENARIO WITH DIFFERENT PLAYERS IN THE ARENA?
[01:35:02]
>> IF I COULD ADD ONE THING, MADAM CHAIR.
>> WHEN YOU START THINKING ABOUT THIS PROCESS, THE FIRST ROUND OF THE INTERVIEWS IS THE APPLICATION.
THE RESUME. IT IS THE PAPERWORK.
LEGITIMATELY. THAT IS THE FIRST ROUND OF THE INTERVIEW. BASICALLY, ALL OF APPLICANTS THAT WERE LOOKED AT, THEY MADE IT TO THE FIRST ROUND OF THE INTERVIEW. THE PHYSICAL DISCUSSIONS AND THE MEETING, THAT WOULD BE A SECOND ROUND OF THE INTERVIEWS.
YOU CAN JUMP IN THERE IF I'M OFF-BASE ON.
THAT I DON'T THINK THAT WE ARE CREATING SOME TYPE OF A PRECEDENT BY ONLY INTERVIEWING, BY ONLY TAKING ONE APPLICANT TO THE SECOND PHASE OF AN INTERVIEW PROCESS.
>> I THINK THE WHOLE DEBATE YOU JUST HAD IS EXACTLY THE SAME CONVERSATION JODY AND I HAD OURSELVES OUTSIDE OF THIS MEETING. FROM TOP TO BOTTOM.
FROM THE QUALIFICATIONS OF THIS INDIVIDUAL, AND WE MET WITH HER.
JODY HAD LUNCH WITH HER. WE HAD A VIRTUAL MEETING WITH HER FOR A PERIOD OF TIME. HER QUALIFICATIONS, HER EXPERIENCE, THE BREADTH OF KNOWLEDGE, THE MUNICIPAL STATE OF FLORIDA KNOWLEDGE IS EXACTLY WHAT YOU NEED FOR THIS TYPE OF POSITION. A GREAT EXAMPLE, I DIDN'T KNOW I WAS GOING TO COME HERE TO TALK ABOUT MUNICIPAL PUBLIC SERVICE TAX. IT IS ONE OF THOSE THINGS YOU NEED TO PULL. SHE HAS A LOT OF EXPERIENCE SHE IS GOING TO BE ABLE TO PULL FROM.
THAT IS GOING TO BE USEFUL HERE. ON ALL OF THAT, WEWORTH AGREED COMPLETELY. WE HAVE THE SAME CONCERNS ABOUT ONLY HAVING ONE INTERVIEW. IT REALLY WAS THE PUBLIC PERCEPTION CONCERNS. AS FAR AS, YOU KNOW, WHETHER THIS PERSON WAS THE RIGHT FIT. ABSOLUTELY.
AND WE THOUGHT IT WOULD BE, IN A PERFECT WORLD, IDEALLY, YOU WOULD WANT TO HAVE AT LEAST ONE MORE INTERVIEW.
IF FOR NOTHING ELSE, THE PUBLIC PERCEPTION.
FOR ALL THE REASONS WE TALKED ABOUT HERE.
THAT YOU ARE HIRING SOMEBODY THAT WAS PRE-DECIDED.
DECIDED BEHIND CLOSED DOORS. ANY OF THE THINGS THAT MIGHT BE SAID. WHICH ISN'T THE CASE.
YOU ARE HAVING A GREAT DISCUSSION RIGHT HERE AT A PUBLIC MEETING. THE OTHER SIDE IS YOU DON'T WANT TO LOSE THE CANDIDATE. IT WILL TAKE TIME TO HAVE A MEETING, FOR ALL OF YOU TO HAVE THAT CONVERSATION WITH A NEW CANDIDATE. YOU RISK LOSING THE CANDIDATE THAT EVERYBODY THINKS IS PERFECT.
I THINK I WILL FALL BACK ON THERE IS NO LEGAL REQUIREMENT THAT YOU HAVE ANOTHER MEETING AND ANOTHER INTERVIEW.
I DON'T THINK IT SETS A PRECEDENT THAT HAS TO BE FOLLOWED BY OTHERS. I THINK YOU HAVE ALL EXPRESSED YOUR REASONS FOR WHY YOU THINK THAT THIS WOULD BE OR COULD BE A REASON TO GO FORTH WITH JUST ONE CANDIDATE.
BUT IF YOU COULD FIND THE ABILITY TO INTERVIEW A SECOND ONE IN A QUICK TIME AND NOT LOSE THE FIRST, ABSOLUTELY, I THINK YOU SHOULD DO THAT. SO YOU ARE IN A GOOD SPOT BUT A
TOUGH SPOT AS WELL. >> I THINK THE TIMING IS THE
>> TIMING IS THE REAL ISSUE FOR US.
>> YEAH. I THINK IDEALLY, IF WE HAD PLENTY OF TIME, IDEALLY,-- RIGHT NOW WE HAVE A CANDIDATE THAT SEEMS TO BE PERFECT FOR THIS SPOT.
AND I WOULD HATE-- SOMEBODY ELSE IS GOING TO THINK HE IS THE
PERFECT, TOO. >> WE HAVE TO REMEMBER THAT, YOU KNOW, IN THE TIME THAT WE ARE LIVING IN NOW, PEOPLE ARE GETTING THOSE QUALIFIED PEOPLE TO WORK FOR THEM, AND THEY ARE WILLING TO PAY. SHE IS WILLING TO NEGOTIATE WITH US ON THE SALARY. SHE HAS HER CAP OF WHAT SHE WANTS TO BE PAID. BUT SHE ALSO IS WILLING TO NEGOTIATE WITH US. I THINK WE NEED TO EXPEDITE THIS ISSUE BECAUSE IF WE DON'T, WE MAY LOSE HER.
TO SOMEONE ELSE. >> DOES THIS REQUIRE A VOTE OR
CONSENSUS TO THE BOARD? >> I THINK THEY JUST NEED DIRECTION IS WHAT JAVY AND I DISCUSSED.
>> TO THE CHARTER, IT DOESN'T REQUIRE THAT IT BE DONE.
>> DOES IT HAVE TO BE UNANIMOUS? >> (LAUGHTER).
>> WELL, FOR THE FIRST TIME, WE ARE HEARING AN IN-HOUSE
THIS WOULD BE THE FIRST TIME. >> RIGHT.
THIS WILL BE THE FIRST TIME. AND ONE OF THE THINGS I SAID TO THIS CANDIDATE IS THIS IS-- WOULD A LOT OF YOUR PERSONAL STAMP IS GOING TO BE HOW YOU CREATE THIS POSITION WHICH IS KIND OF DIFFERENT THAN THE POSITION WE HAVE HAD BEFORE.
EVEN THOUGH YOU ARE GOING TO BE DOING A LOT OF THE SAME THINGS.
THEY ARE GOING TO BE IN HOUSE, OFFICED HERE.
AND WORKING-- WORK PRODUCT FROM HERE.
AVAILABLE. IT IS JUST A DIFFERENT KIND OF ARRANGEMENT. BUT THE PERSON, EVEN THOUGH THEY ARE IN HOUSE, AND IS SALARIED, THEY WILL REPORT TO THE BOARD.
[01:40:02]
WHICH IS EXACTLY THE WAY THE CITY DOES.OUR ATTORNEY IS IN-HOUSE. HIRED BY THE BOARD AND REPORTS
ONE CLARITYCATION, ON MR. FEE'S QUESTION THERE.
I THINK THIS WOULD BE GUIDANCE FOR JAVY TO MOVE FORWARD WITH NEGOTIATIONS FOR THE HIRE. THE HIRING DECISION, I THINK, WOULD COME BACK TO THIS BOARD. BECAUSE YOU ARE ALL HIRING.
>> THE CONTRACT WOULD HAVE TO COME BACK.
RIGHT. >> THIS WOULD BE DIRECTION FOR JAVY TO TAKE THE NEXT STEP WITHOUT SCHEDULING ANOTHER INTERVIEW WITH THE SECOND CANDIDATE.
>> EVEN THOUGH WE GIVE THEM A DIRECTION TO OPEN UP NEGOTIATIONS, IS THERE ANY PROHIBITION FROM THE BOARD TO CONTINUE TO DOER IS VIEWS WHILE WE ARE IN NEGOTIATIONS? DO YOU THINK OPTICALLY, THAT WOULD BE POOR.
IF MR. LAMMERS WANTED TO INTERVIEW SOMEONE ON-- YOU KNOW, I'M PRESUMING THIS IS GOING TO BE A WEEK, TWO-WEEK DANCE.
MAYBE. BETWEEN THE CANDIDATE AND THE U.A. AND THERE IS TIME THERE.
I DON'T SEE WHY THAT TIME CAN'T BE UTILIZED TO INTERVIEW ANYBODY FOR A BACKUP. BEFORE WE GIVE DIRECTION TO START TALKING TO THE NEXT PERSON.
>> INSA THAT SAME REGARD, THOUGH, IF WE WERE TO HAVE SOMEBODY THAT WOULD BE WILLING TO GET THOSE MEETINGS DONE SO QUICKLY, IF SHE SIGNS IT AND THEN --
>> WELL, YOU WOULD HAVE TO BE CLEAR WITH THE INTERVIEWEE.
THAT THERE IS ONE ACT OF NEGOTIATION.
>> A BACK-UP NEGOTIATOR. >> I WILL SAY IF I WAS THE ONLY
HURDLE, I HAVE BEEN PERSUADED. >> IF THAT CANDIDATE IS WATCHING THIS MEETING, WOULD YOU WANT TO SUBJECT-- YOU KNOW --
>> THERE IS ALWAYS THE POSSIBILITY SHE MIGHT GET A BETTER OFFER. AND THERE IS NOTHING WE CAN DO ABOUT IT. WE WANT TO SAY, NO, THAT IS NOT
GOING TO HAPPEN. >> YOU ARE EXACTLY RIGHT.
YES. >> THERE IS A POSSIBILITY-- A REAL POSSIBILITY THAT IT IS GOING TO HAPPEN.
>> I THINK WE SHOULD GIVE DIRECTION FOR NEGOTIATION
I REMEMBER WHEN WE WERE FIRST STARTING TO TALK ABOUT THIS.
THERE SEEMED TO BE AN IDEA OR A LACK OF CONFIDENCE THAT WE WOULD BE ABLE TO FIND SOMEONE WITH ALL OF THE BOXES CHECKED.
ANDLO AND BEHOLD, HERE WE ARE. THE TIME COMPONENT WAS THE THING THAT REALLY PERSUADED ME. I DON'T WANT TO MISS OUT ON THE
GOLDEN OPPORTUNITY. >> WE ALSO HAVE TO REMEMBER THAT WE TOLDIER AND MADAM DHIER LOOK THROUGH THE DIFFERENT APPL APPLICANTS. THEY DISCUSSED.
>> WE DID DO THAT. >> WE NARROWED IT DOWN TO THOSE DIFFERENT-- YOU KNOW, THOSE PROSPECTS.
AND THEN THEY BROUGHT IT BACK TO US.
WE SAID OKAY, WE WOULD LIKE TO INTERVIEW HER.
AS YOU SAID. AND THIS IS THE ROUND THAT WE CAME IN AND INTERVIEWED. THAT IS THE SECOND ROUND.
NOW WE NEED TO MAKE A DECISION AND GO INTO NEGOTIATIONS BECAUSE
IF WE DON'T, WE MAY LOSE HER. >> I WOULD LIKE TO HEAR WHAT THE DIRECTORS ALSO HAVE TO SAY. BECAUSE YOU ALSO INTERVIEWED H HER. CORRECT?
>> YES. ALL OF THE FEEDBACK FROM THE DIRECTORS WAS POSITIVE. ON THIS PARTICULAR CANDIDATE.
>> SOUNDS LIKE WE ARE PRETTY CLEAR, THEN, WITH WHAT OUR INTENTIONS ARE. OKAY.
>> THANK YOU. >> YOU DON'T NEED ANYTHING MORE.
YOU HAVE DIRECTION. >> YES, MA'AM.
(LAUGHTER). >> TONIGHT, RIGHT?
YOU ARE GOING TO START. >> GET ON THE PHONE ON THE WAY OUT. PLEASE.
>> CALL HER UP TONIGHT, YES. EXACTLY.
[I.1. Adopt Resolution No. UA 2023‐03, a resolution amending the budget of Fort Pierce Utilities Authority of the City of Fort Pierce, Florida for the Fiscal Year beginning October 1, 2021 and ending September 30, 2022.]
ALL RIGHTY. WELL, THE NEXT ONE IS THE RESOLUTIONS. WE HAVE THE RESOLUTION UA-20, 23-03. AMENDING THE 2022 BUDGET.ASSUMING THIS RESOLUTON IS APPROVED, THEN MISS MICAH AND MR. CISNEROS WILL BE TAKING IT TO THE CITY COMMISSION FOR APPROVAL OF THE ACFR. AND ALSO THE AUDIT AND THEN THAT WOULD TRIGGER THE TRANSFER TO THE CITY OF THE 6%.
THE LAST ACT IN THE BARBER SHOW TONIGHT.
-- BARBARA SHOW TONIGHT. >> THANK YOU, MR. HUTCHINSON.
THANK YOU TO THE BOARD FOR FOR ACCEPTING AND APPROVING THE FINANCIALS TO MOVE ON TO THE NEXT STEP.
THIS ITEM HERE THAT I HAVE TO PRESENT TO YOU IS THE RESOLUTION AMENDING THE BUDGET FOR THE FISCAL YEAR, 2022.
FOR THE OPERATIONS OF FORT PIERCE UTILITIES AUTHORITY FROM THE BUDGET AS AMENDED IN AUGUST OF 2022 TO THE FINAL ACTUALS THAT WERE JUST REVIEWED IN THE PREVIOUS PRESENTATION.
THE FINAL ADJUSTMENTS TO THE BUDGET ARE FINAL REVENUES AT $139 MILLION, $172,000. $2,633,0 # 2 GREATER THAN
[01:45:12]
ANTICIPATED. THE EXPENSES FOR THE FINANCIAL STATEMENTS OF $14,795,694 WERE BELOW OUR EXPECTATIONS BY $1,653,55 #. THE MAIN DRIVERS THAT RESULTED IN AN INCREASE OVER THE BUDGET OF CHANGE IN OUR NET POSITION OF $4,376,939 WAS LOWER THAN PROJECTED COSTS ASSOCIATED WITH THE PURCHASE POWER AND GAS, SAVINGS IN BUDGETED SALARIES DUE TO VACANT POSITIONS, LOWER-THAN-EXPECTED EXPENSES FOR CONTRACTUAL PROFESSIONAL FEES. ALL OF WHICH WERE OFFSET IN PART BY A REALIZED LOSS TO OUR PENSION LIABILITY FOR THE FISCAL YEAR. THAT IS ROUTINE ITEM.I WOULD LIKE TO ASK THE BOARD TO ADOPT RESOLUTION NUMBER 2023-03, THE FINAL BUDGET AMENDMENT FOR FISCAL YEAR 2022.
>> PLEASE CALL THE ROLL. >> RESOLUTION NUMBER UA.
>> 2023-03, A RESOLUTION AMENDING THE BUDGET OF FORT PIERCE UTILITIES AUTHORITY OF THE CITY OF FORT PIERCE, FLORIDA FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2021 AND ENDING
SEPTEMBER 30, 2022. >> PLEASE CALL THE ROLL.
WE DON'T HAVE TO DO A-- WE CAN MOVE APPROVAL.
>> YES, MA'AM. >> MR. LAMMERS?
>> YES, MA'AM. >> MAYOR HUDSON?
>> YES, MA'AM. >> MRS. GIBBONS?
[J. DIRECTOR]
MR. DIRECTOR FOR THE DAY. DO YOU HAVE ANYTHING YOU WOULDLIKE TO SHARE? >> A FEW LITTLE NOTES TO PASS ON HERE. THE MAP OF THE TIDEWATER PUD, THAT WAS THE ITEM THAT WAS MISSING.
THE MAP THAT WAS DISTRIBUTED OUT TO THE BOARD.
WE WILL MAKE SURE THOSE EXHIBITS MAKE IT ON FOR FUTURE.
WE WILL START LOOKING AT THE PLANNEN ISSUES LIKE.
THAT ALSO SENT OUT TO THE BOARD BUT AN EMAIL WITH SEVERAL ATTACHMENTS RELATED TO THE CHARTER REVIEW COMMITTEE.
AS WELL. THAT IS SOMETHING FOR REVIEW AS WELL. THERE IS OBVIOUSLY SOME GOOD HISTORY THERE. SOME GOOD LESSONS IN THAT ONE.
THE LAST ONE IS JUST TOUCHING ON THE GAS RATES.
CURRENTLY, THEY ARE AROUND $2.50.
IT IS LOOKING LIKE THE FUTURES RIGHT NOW, THE 2024-2025 FUTURES ARE AT $3.82. THAT IS 82 CENTS ABOVE THE THRESHHOLD FOR CONSIDERING PURCHASING MORE.
THAT IS ALL I HAVE. MR. ATTORNEY?
[K. ATTORNEY]
>> JUST ONE QUICK-- I DID SOME QUICK RESEARCH, MADAM MAYOR ON THE QUESTION. ON THE SURCHARGE FOR OUT OF CITY RESIDENTS IN THE NEW PROPOSED LEGISLATION.
IT DOES LOOK LIKE IT IS SILENT ON THE ELECTRIC AND GAS SURCHARGE. IT DOESN'T ADDRESS THE ABILITY TO CHARGE THAT 10% THAT MATCHES THE MUNICIPAL PUBLIC SERVICE TAX. BUT IT DOES RESTRICT THE WATER AND SEWER WATER-- THERE USED TO BE A 25% ALLOWABLE SURCHARGE.
THEY HAVE STRICKEN THAT. THERE IS STILL SOME AMBIGUOUS LANGUAGE ALLOWING THEM-- IT REQUIRES THEM TO SET JUST AND REASONABLE RATES FOR THE OUTSIDE THE CITY FOR WATER AND SEWER.
THEN IT ALLOWS, IT CAPS THE TOTAL AMOUNT UP TO 25% GREATER THAN IN THE CITY. THERE USED TO BE THIS STATED RATE. YOU MAY CHARGE UP TO A 25% SURCHARGE. NOW THEY MUST BE JUST AD REASONABLE. THEY CAN'T BE MORE THAN 25%.
THEY STRICT... THEY STRUCK THE 25% SURCHARGE.
>> SO ESSENTIALLY, ANYTHING ABOVE 25% IS GOING TO BE CONSIDERED-- IF YOU ARE BELOW 25%, YOU MIGHT BE SUBJECT TO
SOME SORT OF ACTION. >> ANYTHING ABOVE 25% IS PROHIBITED. ANYTHING UP TO 25% NEEDS TO BE JUST AND REASONABLE. BASICALLY, PROVEN TO BE COST OF
SERVICE-RELATED. >> THAT MAKES SENSE.
I'M SURPRISED THEY HAD IT WITHOUT THAT BEFORE.
HMM. ANY QUESTIONS REGARDING THAT?
>> THANK YOU. >> THAT WAS ALL I HAD.
WE TALKED ABOUT ALL OF THE REST OF IT BEFORE.
[L. COMMENTS FROM BOARD MEMBERS]
>> WELL, HOPEFULLY SOON YOU WILL BE OUT OF A JOB HERE.
[01:50:01]
>> YOU MISS THAT DRIVE ACROSS THE STATE.
THANK YOU. I DO HAVE A FEW COMMENTS.
THANK YOU, MR. HUTCHINSON FOR STEPPING IN TODAY.
YOU DID A GREAT JOB. I ALSO WANTED TO BRING BACK UP THE BANK DISCUSSION REGARDING-- I DIDN'T WANT TO KEEP SEACOAST ON THE PHONE TO HAVE THIS DISCUSSION.
I'M CURIOUS WHAT YOUR THOUGHTS ARE ON POTENTIALLY HAVING SOME FUNDS IN ANOTHER BANK IN ORDER-- IN CASE OF EMERGENCY THAT SOMETHING DOES HAPPEN WITH SEACOAST THAT, WE HAVE AVAILABLE FUNDS TO AT LEAST COVER A DAY'S WORTH OF BUSINESS, PAYROLL, WHATEVER. MAYBE THAT NUMBER IS A MILLION DOLLARS OR SOMETHING. I DON'T REALLY KNOW THAT FIGURE.
CURIOUS WHAT YOUR THOUGHTS ARE AND ALSO WHAT FMPA IS DOING, IF THEY HAVE A STANDARD OF WHAT THEY HAVE GOING ON.
>> I CAN CERTAINLY GET BACK TO YOU ON WHAT FMPA IS DOING.
OFF THE TOP OF MY HEAD, I DON'T KNOW.
I CAN FIND OUT AND SEND INDIVIDUALLY TO THE MEMBERS HERE. WHAT THEY ARE DOING.
BUT NO, OFF THE TOP OF MY HEAD, I'M NOT SURE HOW DIVERSIFIED
THEY ARE IN THAT. >> I THINK-- I DON'T KNOW-- I KNOW WHAT YOU ARE SAYING. IN THE PAST, YOU TALK ABOUT DIVERSIFIED, DON'T PUT ALL YOUR NETION ONE BASKET OR WHATEVER.
I THINK WE WOULD HAVE TO FIND OUT FROM THE FINANCE PEOPLE.
DIDN'T WE GET SOME FAVORABLE RATES FOR SOME INVESTMENTS BECAUSE WE HAVE WHAT WE HAVE THERE? I DON'T KNOW IF THAT MIGHT BE A TRADEOFF.
>> I THINK THAT IS THE BOND PROCEEDS THAT WE HAVE.
WE WERE TALKING ABOUT THE MONEY MARKET ACCOUNTS AND INSTEAD OF DOING THAT, WE HAVE MOVED THEM INTO THESE OTHER-- OR WE ARE GOING TO MOVE T THEM INTO THAT SECURED-- THIS MAYBE WOULD BE MORE OF THE GENERAL FUND. OUR OPERATING BANK ACCOUNT.
I DON'T-- RIGHT. >> BARBARA, YOU JUST THOUGHT YOU WERE DONE, BARBARA. WOULD YOU LIKE TO COME BACK UP?
>> AN ENCORE. THANK YOU, BARBARA.
(LAUGHTER). >> WE DO HAVE MONEY IN OTHER BANKS. WE HAVE A MONEY MARKET WHICH IS VERY LIQUID AT PNC. WHICH HAS AROUND $4 MILLION IN
>> AGAIN, SIMILAR TO THE MONEY MARKET THAT WE HAVE AT SEACOAST, THAT MONEY IS NOT INSURED. IT IS AT PNC.
WE HAVE FUNDS IN OTHER BANKS. WE HAVE OTHER CD'S.
WE HAVE AN SBA. I DON'T RECALL THE AMOUNT.
I WOULD HAVE TO GRAB MY QUARTERLIES BACK FROM THE QUARTERLY INVESTMENT SCHEDULE IN ONE OF THOSE BLUE BOOKS THAT YOU HAVE. WE HAVE MONEY IN OTHER ACCOUNTS.
WE COULD CERTAINLY-- IF YOU ARE-- I THINK WHAT SEACOAST IS PLANNING TO DO IS TO INSURE THAT MONEY, I THINK IT IS SAFER THAN PUTTING MONEY SOMEPLACE ELSE WHERE THEY ARE NOT GOING TO BE
WILLING TO DO THAT. >> RIGHT I.
I AGREE. I DIDN'T REALIZE WE HAD $4 MILLION IN PNC AS WELL. FOR ME, THAT SATISFIES WHAT I
WAS-- YEAH. >> BOTH ARE VERY LIQUID.
>> ANY OTHER QUESTIONS REGARDIN- >> THAT ANSWERS THE QUESTION.
>> THAT IS PERFECT. THAT IS ALL I WAS LOOKING FOR.
MAKING SURE WE CAN MAKE PAYROLL. (LAUGHTER).
>> WHY ARE YOU SO CONCERNED? (LAUGHTER).
>> NOT FOR ME. BUT IT IS EVERYBODY ELSE.
I AM, YES. I HAVE TO COME UP WITH THOSE
>> IF THERE IS NOTHING -- >> A RISK MANAGER CAN ANSWER YOUR QUESTION. I WILL CATCH YOU AFTERWARDS.
>> ANY OTHER ITEMS ANYBODY WOULD LIKE TO DISCUSS? ALL RIGHT. THAT IS IT.
THANK
* This transcript was compiled from uncorrected Closed Captioning.