Funding Mechanisms for Funding Mechanisms for Infrastructure Improvements Infrastructure Improvements

for Historic Subdivisionsfor Historic Subdivisions(Magnolia Gardens, Wakulla (Magnolia Gardens, Wakulla

GardensGardensGreiner’s Addition and Lake Ellen Greiner’s Addition and Lake Ellen

Estates)Estates)

Task: Research and analyze funding options Task: Research and analyze funding options available for infrastructure improvements for available for infrastructure improvements for

“Historic Subdivisions”“Historic Subdivisions”

Infrastructure:Infrastructure:1.1. Road PavingRoad Paving2.2. Stormwater MaintenanceStormwater Maintenance3.3. SewerSewer4.4. Sidewalks and Street lightingSidewalks and Street lighting5.5. ParksParks

Research MethodologyResearch Methodology Survey of surrounding and fast Survey of surrounding and fast

growing FL counties to learn peer growing FL counties to learn peer practicespractices

Analysis of all available revenue Analysis of all available revenue sources available to local sources available to local governmentsgovernments

Discussions with FL Redevelopment Discussions with FL Redevelopment Association re: CRAs/TIFAssociation re: CRAs/TIF

Infrastructure Cost EstimatesInfrastructure Cost Estimates

PAVING, CURBING, SIDEWALKS, STORMWATER and PAVING, CURBING, SIDEWALKS, STORMWATER and STREET LIGHTINGSTREET LIGHTING Subdivision Mileage Cost

Wakulla Wakulla Gardens Gardens

21.82 21.82 $4,909,500$4,909,500

Magnolia Magnolia Gardens Gardens

5.835.83 $1,311,750$1,311,750

Lake Ellen Lake Ellen Estates Estates

1.551.55 $348,750$348,750

Griners Griners Addition Addition

4.464.46 $1,003,500$1,003,500

Subtotal Subtotal Roadway:Roadway:

33.6633.66 $7,573,500$7,573,500

Infrastructure Cost EstimatesInfrastructure Cost Estimates

Sewer SystemSewer System Subdivision Status Cost

Wakulla Gardens Wakulla Gardens Project has begunProject has begun $14,000,000 $14,000,000 (funding already (funding already received)received)

Magnolia Gardens Magnolia Gardens and Greiner’s and Greiner’s AdditionAddition

Neighborhoods Neighborhoods were cost were cost estimated estimated together due to together due to proximityproximity

$6,091,000$6,091,000

Lake Ellen Estates Lake Ellen Estates $2,070,000$2,070,000Subtotal Sewer:Subtotal Sewer: $22,161,000$22,161,000

($14,000,000 ($14,000,000 already funded)already funded)

Infrastructure Cost EstimatesInfrastructure Cost Estimates

Total Infrastructure Cost by SubdivisionTotal Infrastructure Cost by SubdivisionSubdivision Cost

Wakulla Gardens Wakulla Gardens Sewer Project has Sewer Project has funding and has funding and has begunbegun

$4,909,500$4,909,500

Magnolia Gardens Magnolia Gardens and Greiner’s and Greiner’s AdditionAddition

Neighborhoods Neighborhoods were cost were cost estimated estimated together due to together due to proximityproximity

$8,406,250$8,406,250

Lake Ellen Estates Lake Ellen Estates $2,418,750$2,418,750All Historic All Historic SubdivisionsSubdivisions

(w/o parks) Grand (w/o parks) Grand TotalTotal

$29,734,500$29,734,500($14,000,000 ($14,000,000 already funded)already funded)

Funding AlternativesFunding AlternativesCRA/Tax Increment FinancingCRA/Tax Increment Financing

Chapter 163, part III – Florida StatutesChapter 163, part III – Florida Statutes Presence of “Slum and Blight”Presence of “Slum and Blight” Plan that addresses the unique needs Plan that addresses the unique needs

of the targeted area – redevelopmentof the targeted area – redevelopment First step – finding of necessityFirst step – finding of necessity CRA overseen by 5 – 7 member CRA CRA overseen by 5 – 7 member CRA

BoardBoard

Funding AlternativesFunding AlternativesCRA/Tax Increment FinancingCRA/Tax Increment Financing

Tax Increment FinancingTax Increment Financing Funding tool available for redevelopment Funding tool available for redevelopment

activitiesactivities Public funds leverage private sector activity Public funds leverage private sector activity

in areain area Tax increment = tax dollars over “frozen Tax increment = tax dollars over “frozen

value”value” Increment infused back into CRAIncrement infused back into CRA Public funds can be bondedPublic funds can be bonded

Funding AlternativesFunding AlternativesCRA/Tax Increment FinancingCRA/Tax Increment Financing

AdvantagesAdvantages New growth pays for infrastructure improvements.New growth pays for infrastructure improvements. Continuing source of funding for infrastructure improvements (up to 30 Continuing source of funding for infrastructure improvements (up to 30

years).years). Stable source of funding if the community is growing consistently over Stable source of funding if the community is growing consistently over

time.time. If implemented well, CRA’s will encourage expanded growth in the area.If implemented well, CRA’s will encourage expanded growth in the area. Revenues can be bonded (with approval by electorate by referendum)Revenues can be bonded (with approval by electorate by referendum)

DisadvantagesDisadvantages ““Ties up” property tax growth from CRA for up to 30 yearsTies up” property tax growth from CRA for up to 30 years Property tax growth from CRA will only benefit one segment of the CountyProperty tax growth from CRA will only benefit one segment of the County CRAs somewhat unstable at this point in time with pending Supreme CRAs somewhat unstable at this point in time with pending Supreme

Court cases also resulting in added “attention” by LegislatureCourt cases also resulting in added “attention” by Legislature Requires a significant study to develop finding of necessity and CRA planRequires a significant study to develop finding of necessity and CRA plan Revenues would fluctuate with the level of development activityRevenues would fluctuate with the level of development activity

Funding AlternativesFunding AlternativesImpact FeesImpact Fees

Charges imposed against new development Charges imposed against new development to provide for the cost of capital facilities to provide for the cost of capital facilities made necessary by that growth. made necessary by that growth.

The Board currently imposes impact fees in The Board currently imposes impact fees in for the following categories: Roads, for the following categories: Roads, Corrections, Public Buildings, Library, Parks Corrections, Public Buildings, Library, Parks and Recreation and Law Enforcement. and Recreation and Law Enforcement.

Board studied possibility of increasing Board studied possibility of increasing impact fees in 2007, but opted not to impact fees in 2007, but opted not to pursue after much deliberation.pursue after much deliberation.

Funding AlternativesFunding AlternativesImpact FeesImpact Fees

AdvantagesAdvantages Continuing source of funding for capital expenditures.Continuing source of funding for capital expenditures. Stable source of funding if the community is growing consistently over timeStable source of funding if the community is growing consistently over time Generally less political opposition since the fee is a one-time occurrence and not a Generally less political opposition since the fee is a one-time occurrence and not a

permanent increase in taxes.permanent increase in taxes. The burden could be shared by non-residential development, depending upon the The burden could be shared by non-residential development, depending upon the

basis for the fee.basis for the fee.

DisadvantagesDisadvantages Generates limited amount of funding.Generates limited amount of funding. May discourage new businesses and economic development.May discourage new businesses and economic development. Requires a significant study to develop impact fee schedule that can be defended Requires a significant study to develop impact fee schedule that can be defended

from a legal perspective.from a legal perspective. Revenues cannot be used for operating expenses, and may have to be limited to Revenues cannot be used for operating expenses, and may have to be limited to

capital costs. capital costs. Revenues would fluctuate with the level of development activity.Revenues would fluctuate with the level of development activity. Eliminating or shortening routes that are not cost-effective may become more Eliminating or shortening routes that are not cost-effective may become more

difficult, since future impact fee revenues from the areas they served would be lost, difficult, since future impact fee revenues from the areas they served would be lost, and refunds of fees already paid might even be required.and refunds of fees already paid might even be required.

Funding AlternativesFunding AlternativesNon Ad Valorem Assessments/ Non Ad Valorem Assessments/

MSBUsMSBUs County establishes a special district to allow a group of County establishes a special district to allow a group of

citizens to fund a desired improvement such as utilities, citizens to fund a desired improvement such as utilities, storm water, solid waste and roads. storm water, solid waste and roads.

Property owner finances assessment over period of time Property owner finances assessment over period of time (generally 10 to 15 years)(generally 10 to 15 years)

Assessment appears annually on the property tax bill as Assessment appears annually on the property tax bill as a non-ad valorem assessmenta non-ad valorem assessment

Two requirements exist for the imposition of a valid Two requirements exist for the imposition of a valid assessment: 1.The property assessed must derive a assessment: 1.The property assessed must derive a special benefit form the improvement or services special benefit form the improvement or services provided and, 2.The assessment must be fairly and provided and, 2.The assessment must be fairly and reasonably apportioned among the properties that reasonably apportioned among the properties that receive the special benefit.receive the special benefit.

Funding AlternativesFunding AlternativesNon Ad Valorem Assessments/ Non Ad Valorem Assessments/

MSBUsMSBUsAdvantagesAdvantages Dedicated source of funding.Dedicated source of funding. No referendum or voter approval required.No referendum or voter approval required. Efficient collection of funds since an MSBU can be placed on tax Efficient collection of funds since an MSBU can be placed on tax

bill procedures for collecting these taxes is already in place.bill procedures for collecting these taxes is already in place. An equitable funding mechanism that can be established to An equitable funding mechanism that can be established to

collect funding from only those who are benefiting from the collect funding from only those who are benefiting from the improved service/infrastructure.improved service/infrastructure.

DisadvantagesDisadvantages MSBU revenue could sunset when project debt is paid.MSBU revenue could sunset when project debt is paid. Increased expectations and scrutiny is expected to result since a Increased expectations and scrutiny is expected to result since a

line item will appear on the homeowner’s trim bill that specifically line item will appear on the homeowner’s trim bill that specifically identifies revenue for infrastructure improvements. identifies revenue for infrastructure improvements.

Tourists do not directly contribute to this local funding source.Tourists do not directly contribute to this local funding source.

Funding AlternativesFunding AlternativesMunicipal Service Taxing Unit Municipal Service Taxing Unit

specific taxing unit established by specific taxing unit established by BOCC via an adopted ordinance, BOCC via an adopted ordinance, which derives a specific benefit - a which derives a specific benefit - a levy is imposed to defray part or all levy is imposed to defray part or all of the cost of providing that benefitof the cost of providing that benefit

funding is created through a millage funding is created through a millage rate rate

Funding AlternativesFunding AlternativesMunicipal Service Taxing Unit Municipal Service Taxing Unit

AdvantagesAdvantages Dedicated source of funding.Dedicated source of funding. Flexible funding mechanism in terms of geographic coverage and the ability to “tier” the taxing Flexible funding mechanism in terms of geographic coverage and the ability to “tier” the taxing

unit based on need, benefit, and other factors.unit based on need, benefit, and other factors. No referendum or voter approval required.No referendum or voter approval required. Efficient collection of funds since an MSTU is based on ad valorem taxes and the procedures for Efficient collection of funds since an MSTU is based on ad valorem taxes and the procedures for

collecting these taxes is already in place.collecting these taxes is already in place. Established acceptance and support from participating municipalities, given that each has Established acceptance and support from participating municipalities, given that each has

approved MSTU ordinances that stipulate support of the MSTU.approved MSTU ordinances that stipulate support of the MSTU. An equitable funding mechanism that can be established to collect property taxes from only those An equitable funding mechanism that can be established to collect property taxes from only those

who are benefiting from the improved service/infrastructure.who are benefiting from the improved service/infrastructure. Stable source that has been growing at a rate greater than inflation.Stable source that has been growing at a rate greater than inflation.DisadvantagesDisadvantages All properties within the boundaries of the MSTU are generally taxed equally regardless of whether All properties within the boundaries of the MSTU are generally taxed equally regardless of whether

the homeowners directly benefit from the service/infrastructure that is implemented with the the homeowners directly benefit from the service/infrastructure that is implemented with the revenues that are collected.revenues that are collected.

Homestead and other exemptions will lower tax proceeds as the number of exemptions increase Homestead and other exemptions will lower tax proceeds as the number of exemptions increase over time.over time.

May be political opposition to a tax increase if the MSTU generates revenues beyond what was May be political opposition to a tax increase if the MSTU generates revenues beyond what was previously funded from the general revenue fund.previously funded from the general revenue fund.

Significant administrative and legal burdens related to the determination and justification of MSTU Significant administrative and legal burdens related to the determination and justification of MSTU boundaries, drafting ordinances and resolutions, and possible legal challenges.boundaries, drafting ordinances and resolutions, and possible legal challenges.

Although an MSTU does not apply to a county’s millage cap of 10 mills, it is important to recognize Although an MSTU does not apply to a county’s millage cap of 10 mills, it is important to recognize that it does count towards the 10-mill cap of individual municipalities.that it does count towards the 10-mill cap of individual municipalities.

Tourists do not directly contribute to this local funding source.Tourists do not directly contribute to this local funding source.

Funding AlternativesFunding AlternativesELMS Five Cents Gas TaxELMS Five Cents Gas Tax

Environmental Lands Management (ELMS) Five-Environmental Lands Management (ELMS) Five-Cents Gas Tax Cents Gas Tax

Can be used for transportation expenses needed Can be used for transportation expenses needed for capital improvements elements of an adopted for capital improvements elements of an adopted comp. plan, expenditures needed to meet the comp. plan, expenditures needed to meet the immediate local transportation problems, and for immediate local transportation problems, and for transportation-related expenditures that are critical transportation-related expenditures that are critical for building a comprehensive roadway network. for building a comprehensive roadway network.

The ELMS gas tax cannot be used for routine road The ELMS gas tax cannot be used for routine road maintenance purposes. maintenance purposes.

Funding AlternativesFunding AlternativesELMS Five Cents Gas TaxELMS Five Cents Gas Tax

AdvantagesAdvantages Flexible funding that may be used for either transit operating or capital Flexible funding that may be used for either transit operating or capital

expenses.expenses. More consistent than funding sources that are annually apportioned as part More consistent than funding sources that are annually apportioned as part

of the County’s budget.of the County’s budget. Spreads part of the tax burden to tourists and visitors.Spreads part of the tax burden to tourists and visitors. Does not require voter approval or referendum if approved by an Does not require voter approval or referendum if approved by an

extraordinary majority of the county commissioners.extraordinary majority of the county commissioners.

DisadvantagesDisadvantages Currently dedicated by percentage with no guaranteed funding level.Currently dedicated by percentage with no guaranteed funding level. Not indexed for inflation.Not indexed for inflation. The State takes a cut off the top to fund certain state transportation The State takes a cut off the top to fund certain state transportation

programs and for general revenue.programs and for general revenue. Revenues fluctuate with the economy and tourism.Revenues fluctuate with the economy and tourism. County has already adopted all local option gas taxes.County has already adopted all local option gas taxes. Revenues would be adversely affected by increasing fuel prices and Revenues would be adversely affected by increasing fuel prices and

improvements in fuel efficiency of vehicles.improvements in fuel efficiency of vehicles.

Funding AlternativesFunding Alternatives

Protection Area AssessmentProtection Area AssessmentWakulla County could set up a protection Wakulla County could set up a protection

area for Wakulla Springs and Ochlockonee area for Wakulla Springs and Ochlockonee Bay to protect the environment that Bay to protect the environment that surrounds them.surrounds them.

10/4/10 Program10/4/10 ProgramBoard could annually commit 10% of Board could annually commit 10% of

transportation fund, 4% of general fund and transportation fund, 4% of general fund and 10% of wastewater fund for infrastructure 10% of wastewater fund for infrastructure improvementsimprovements

Stormwater Funding Stormwater Funding AlternativesAlternatives

NWFWMD Florida Forever Capital NWFWMD Florida Forever Capital Improvement Grant ProgramImprovement Grant Program

DCA Block GrantsDCA Block Grants DEP State Revolving Fund Loan DEP State Revolving Fund Loan

Program, Nonpoint Source Program, Nonpoint Source Management Program and TMDL Management Program and TMDL Water Quality Restoration GrantsWater Quality Restoration Grants

Stormwater Funding Stormwater Funding AlternativesAlternatives

Stormwater Utility FeeStormwater Utility Fee used to generate a comprehensive used to generate a comprehensive

stormwater management plan for the entire stormwater management plan for the entire County County

would project future community needs and would project future community needs and maintenance costs of proposed and existing maintenance costs of proposed and existing facilitiesfacilities

Wakulla County - $10 to $12 per month to Wakulla County - $10 to $12 per month to be effective be effective

Parks and Recreation Grant Parks and Recreation Grant OptionsOptions

Florida Recreation Assistance ProgramFlorida Recreation Assistance Program Land and Water ConservationLand and Water Conservation Florida Communities Trust State Florida Communities Trust State

Grants ProgramGrants Program Recreational Trails ProgramRecreational Trails Program Florida Small Cities Community Florida Small Cities Community

Development Block GrantDevelopment Block Grant

Summary/Next StepsSummary/Next Steps On February 19, 2008 BOCC directed staff to On February 19, 2008 BOCC directed staff to

research and analyze options available for the research and analyze options available for the Board to begin infrastructure improvements in Board to begin infrastructure improvements in Wakulla’s historic subdivisions.Wakulla’s historic subdivisions.

On May 5, 2008 regular Board agenda, BOCC On May 5, 2008 regular Board agenda, BOCC scheduled today’s workshop to discuss.scheduled today’s workshop to discuss.

May 17, 2008 BOCC Workshop – May 17, 2008 BOCC Workshop – discussion/direction to staffdiscussion/direction to staff

Ratification of action taken at today’s Ratification of action taken at today’s workshop will be on June 23, 2008 BOCC workshop will be on June 23, 2008 BOCC meeting agendameeting agenda

Board/Citizen DiscussionBoard/Citizen Discussion