State Water Loan OK’d
Last Friday, Fort Myers Beach Mayor Dennis Boback called a special meeting of the Town Council with just two items on the agenda: Financial Status of the Town and the Town Manager. That special meeting is set for 10am Friday, June 3, 2016.
The Town has been abuzz for weeks over the approximately $3.2 million debt for the water line work already completed. A good portion of those bills were just recently submitted for payment to the town’s Finance Department and the Town does not have the cash on hand to pay those bills. The Town staff has been working with the State of Florida Department of Environmental Protection on a Drinking Water State Revolving Fund Construction Loan Agreement application for months. Town council approved that application at a special May 2, 2016 meeting.
On Tuesday, May 31, 2016, the DEP sent the town a loan agreement for $6,715,317 at a rate of 1.02% per year. That amount includes mandatory capitalized interest of $25,000 so the amount available to the town is $6,690,317. The loan must be repaid via 40 semi-annual payments of $189,749 each beginning September 15, 2017. The rate can increase if the town fails to return the signed loan agreement by July 1, 2016.
This loan covers waterline work for the fiscal year ending September 30, 2017. The next three years will require additional loans as discussed at the Special Meeting May 6th. Jim Steele, a member of the audit committee estimated that the town would need to borrow about $7.2M for fiscal year ending 2018; $9.2M for 2019 and $10.7M for 2020. Each loan will be for 20 years. Steele estimated that the debt service would require a 6-7% increase in water rates for the first year, or approximately $2.75 for the average 5,000-gallon customer. When all the loans are in play, he estimated that the average customer would be paying about $11 more per month to pay for the loans that are funding the island’s water line project, which is expected to be completed in 2020.
The Town is working with Raftelis Financial Consultants on a water rate study to determine rate projections.
Town Council will begin budget discussions at their June 6, 2016 10am Work Session. The preliminary taxable value of Fort Myers Beach property is $3,076,325,000 or an increase of 7.4% over last year. The Lee County Property Appraiser’s Office will provide a final value by July 1, 2016. A budget framework keeping the current millage rate of 0.800, which would produce about $2,461,060 in ad valorem taxes for the town, based on the preliminary value, is provided in the meeting agenda packet. At their June 6th meeting information on mooring field operations, farmer’s market and special events, including fireworks are expected to be discussed. The June 13, 2016 meeting is scheduled to review Bay Oaks and Pool operations, along with departmental reviews.
While the mayor and council members are tight lipped about why the Town Manager is on the agenda for this Special Meeting, some of them have not been very secretive about their unhappiness with our current manager’s performance.
Don Stilwell became Interim Town Manager in January 2014, shortly after Town Council agreed to terminate Terry Stewart from that position without cause, at his request. Council agreed to remove Stilwell’s Interim title in late April that year and he signed a contract on May 5, 2014.
If Stilwell’s position with the town is severed, he will walk away as the 3rd longest serving Town Manager in the Town’s history. Prior to Stilwell, Terry Stewart held the top Town staff position from 2010-2014. Marsha Segal-George held the Town Manager position from incorporation in 1995 to 2005. Between Segal-George and Stewart, there was a succession of six different managers or interim managers over the course of approximately five years: Rachel Lambert, John Gucciardo, David Sallee, Gary Parker, Scott Janke and Jack Green.
A search of public records turned up only one evaluation of Stilwell by Town Council despite his contract that calls for annual evaluations and the development of specific goals and objectives. Council discussed an evaluation in October 2014, which was generally positive, and had further discussions later that month regarding goals and objectives. No further Town Council discussion regarding evaluation of the Town Manager was found.
Stilwell’s contract includes provisions for termination for cause, for disability, termination without cause and voluntary resignation. In the case of “with cause,” disability and voluntary resignation, there is no severance pay. If he is terminated without cause, he is entitled to a lump sum payment of 20 weeks base salary plus any accrued unpaid annual leave. According to the current budget, the manager salary is $174,000/year.
The contract as well as the Town Charter calls for three affirmative votes by Town Council to terminate a Town Manager.
Correction: In a June 3rd article, “Special Meeting Set for Friday State Water Loan OK’d” the Town Manager salary was stated as $174,000 according to the budget. We have learned that figure includes other costs of the Town Manager’s office. According to a May 18, 2016 Town employee salary list, Don Stilwell’s annual salary was $122,408.