The Loxahatchee Groves Water Control District Board of Supervisors approved several items on Monday in anticipation of a referendum on whether to become a dependent district to the Town of Loxahatchee Groves, including paying off a bank loan with money that has been held in escrow.
Attorney Betsy Burden reported on the status of the referendum process, now that the local bill calling for the referendum passed the Florida Legislature and was signed by Gov. Rick Scott on March 23.
“At this point, we can move forward with the referendum as required,” Burden said. “The first step would be passing a resolution initiating the process. You might then want to consider adopting procedures on how the referendum will be conducted, and that would be very similar to those you have conducted for previous referenda. When you do set the date, you will need to have all the logistics in order — the personnel necessary, the accountant, the sheriff’s deputy, the ballots and those kinds of documents.”
She said the referendum must be advertised twice, on the fifth week and the third week prior to the referendum, which must be held on or before Oct. 1, certified by the district and sent to the Florida Department of State.
“If it were to pass, that is when the act will become effective,” Burden said.
LGWCD Chair Anita Kane said the board is aiming for June 25 to have plenty of time. Proxies necessary for the referendum will be posted on the district web site.
Supervisor Simon Fernandez asked if the referendum passes, will the district need to do a budget process for next year. Kane said that would depend on what town officials want.
“The town council can say, ‘We want you five to continue working with [District Administrator Steve Yohe] and set up the budget for the dependent district because you’ve done it before,’ or they can say, ‘We don’t want you to do anything, thanks for your trouble.’ The referendum says the council becomes the district board, so they’re the ones who will make the decision,” Kane said.
Fernandez asked if the board could speed up the process to give the town more time to take care of those issues and suggested a special meeting. “I want to make sure those roads are taken care of as soon as possible,” he said. “This is an emergency.”
Attorney Mary Viator said there are certain steps that must be taken to be sure the referendum is properly implemented so the district does not receive any challenges.
Supervisor Laura Danowski made a motion to target the referendum for June 25, which carried 4-1 with Fernandez opposed.
In other business, the council voted to pay off the district’s Bank United loan of about $300,000, which was to be used for open-graded emulsified mix (OGEM) road paving, rather than turn the money over to the town.
Viator said the town had discussed the available fund balance from the 2012 Bank United loan, and the council asked that the funds be used to reduce the term of the outstanding loan.
She explained that the bank officer had told her that loan can be paid down to reduce the principal, and the bank would provide a new amortization schedule.
Viator recommended that the board not take any action now and get input from the town as to what it is planning as far as resurfacing the OGEM roads, and wait and see if the district becomes dependent or not.
Kane said the council had voted to ask the district to turn over the money as soon as possible.
Fernandez asked if the loan could be discussed at the Intergovernmental Coordination Committee meeting, and Viator agreed.
“We can have an idea to make sure those responsibilities are carried out, or at least know what’s going to happen,” Viator said.
But Kane said the resurfacing material that had been planned for the OGEM roads that the loan is designated for is useless with the condition they are in.
“Somebody thought it was a good idea, but it just turned out to be not a good idea,” she said. “Certainly, those taxpayers wouldn’t want to take their money and pour it down the drain.”
Supervisor Connie Bell pointed out that the minutes of the council show that it intends to pay down the loan with the money if the district transfers it.
“I don’t see any harm with that,” she said.
Supervisor Karen Piesley said she was concerned about the welfare of the residents of the OGEM roads and what they will be left with.
During public comment, former Councilman Ron Jarriel said that the council had voted to ask the district to pay down the debt.
“That’s in the best interest of the citizens,” he said, adding that when he was on the council, the town manager recommended that the council approve a $600,000 contract with Hardrives to resurface the OGEM roads, but the council turned it down because the proper drainage had not been put in on those roads.
Bell pointed out that the loan is restricted for resealing the OGEM roads.
“There’s no need to keep paying interest to do work on roads we don’t own anymore, so it’s a no brainer that it’s got to go back,” she said. “We cannot reseal them in the condition they are now.”
Fernandez asked what the ramification would be of paying down the loan that evening, and Viator advised that they continue to work with the town, although the board could approve paying it down.
Fernandez pointed out that the issue had been presented six months ago to pay it down and avoid further interest payments.
“We’re still messing with it, and I’m trying to eliminate another three months down the road,” he said. “That money doesn’t belong to us; it belongs to the landowners. I want to pay that back. Those landowners seven years ago had no idea that this was going to happen.”
Fernandez made a motion to pay off the debt, against the attorney’s recommendation, which carried 5-0.