LGWCD Board Approves Bank Line Of Credit For Emergencies

The Loxahatchee Groves Water Control District Board of Supervisors on Monday approved a $200,000 revolving line of credit with Floridian Community Bank to cover the immediate cost of emergencies until it can get refunds from the Federal Emergency Management Agency (FEMA).

LGWCD Attorney Mary Viator said details were still being worked out with the bank, which had written the documents as if the district were a private, rather than a government entity, but recommended that board members approve the document before them in light of it being a month into the hurricane season.

“We’re asking you to go ahead and approve it. We will be making the necessary revisions, but you don’t want to delay this particular item in case there are ever any issues dealing with emergency needs for a storm,” Viator said.

Supervisors discussed whether the amount was too much or not enough, and whether the interest rate, 1 percent above the prime interest rate, was reasonable. Yohe said he had negotiated the rate from 1.25 percent down to 1 percent.

Supervisor Don Widing said his experience in emergency management told him that $200,000 would not go very far.

“I don’t know if $200,000 is sufficient. Do we want to consider moving it up a little more?” Widing asked.

Yohe said he brought the item to the board originally in March for $100,000, and the original agreement the district had with SunTrust bank was for $400,000 before the bank canceled the line of credit.

He noted that the emergency cleanup as the result of Tropical Storm Isaac was about $150,000.

“That was the [FEMA] cleanup, and subsequently, the USDA [United States Department of Agriculture] helped us for a period of 18 months, which far exceeded that, but that wasn’t necessarily an emergency situation,” Yohe said.

Widing said the district also has money in reserves, but it could take a long time getting money back from FEMA. “You’re talking a couple of years, most likely,” he said.

Supervisor Anita Kane said the district has $147,000 in reserves, but $100,000 must be kept there to cover the gap at the end of the fiscal year until new assessments come in.

Widing asked whether the district should increase its operating budget to supplement the reserves. “That $200,000 sounds a little light to me,” he said.

Kane asked if a larger amount had been discussed, and Yohe said the $200,000 was his recommendation, but the bank was amenable to $300,000, adding that it has been difficult finding a line of credit.

Kane added that board members would not sign anything until after the upcoming June 26 election, where at least one, possibly two new members will join the board. Yohe said that even if the board was ready, he would not recommend signing until after the election.

Widing agreed, but asked to move on it as quickly as possible since the hurricane season is underway. “I’ve got a lot of years in emergency management, and I’m glad I don’t have to do that anymore for a living. I’m not going to do it anymore except for my town,” he said. “I’ll help you with anything I can when it comes to managing disasters.”

Yohe asked for a consensus of the board as to the amount, and Supervisor Simon Fernandez said he thought $200,000 was the right amount. “With the way FEMA and this new administration are coming around, they’re not going to be too generous,” he said.

Yohe added that the town would also be contributing after any disaster that may happen.

“We will work together with them,” he said. “From an emergency point of view, $200,000 seems to me to be a lot of money to spend in the three or four months’ time for what would be considered an emergency.”

LGWCD President Frank Schiola said the most important thing is to get the line of credit in place.

“Get something going, so at least if there is something there,” he said. “If not, we’ll be scrambling to get something together at the last minute.”

Viator recommended that the board let staff move forward with the documents with a tentative $200,000 and that they finalize an amount later.

Widing made a motion to allow staff to move ahead with the line of credit, which carried 5-0.

In other business, the board agreed to share the cost of surveying Collecting Canal Road and D Road with the town in order to give final approval of a quit claim deed turning over the roads to the town.

Last month, the board agreed to convey the district’s interest in the two roads to the town, and the board directed staff to undertake the necessary field survey and office work necessary to provide legal descriptions to finalize the quit claim deeds. The board also directed staff to ask the town to share equally the $5,700 cost to provide the legal descriptions.

In a subsequent intergovernmental meeting between district and town officials, it was agreed to split the cost for surveyor Erdman Anthony to do the work. After the board’s approval, the plan is for the town to approve the quit claim deeds and for the district to give final approval at its July 10 meeting.

Yohe noted that they also discussed whether the town’s surveyor could do the survey while accomplishing other goals, and Town Manager Bill Underwood discussed the issue with the town engineer. Underwood then notified district staff on June 8 that the town engineer agreed that proceeding with the Erdman Anthony proposal would be the better option.

While the Loxahatchee Groves Town Council did not get to discuss the cost sharing at its June 6 meeting, Underwood and Mayor Dave Browning said they would recommend splitting the cost at the council’s meeting July 18, Yohe said.

Widing made a motion to approve the action, which carried 5-0.