2011-0809 City Commission Workshop

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Summary Minutes:City Commission Workshop August 9.2011 City of Sunny Isles Beach,Florida structuring a line of credit if we were acting like a bank in effect that would advance funds against the job but collateralized with something of tangible value since we are putting up money. She said the finances for this school will most likely be done under a Certificate of Anticipation which is in essence a bond we would create the Ground Lease, we would not be able to collateralize any other piece of property, we can check on that in more detail with their Treasurer which she would have to be involved in these conversations, etc. Mayor Edelcup asked what kind of binding instrument she sees that she could issue that would make the thing happen. She said she never has seen the School Board renege on any of its obligations, even in hard times, our Treasurer and our finance people are extremely conservative and so they always make sure when we get into an arrangement that they can satisfy the obligation,and good faith and good will of the School Board goes a long ways and you can bank on that. Mayor Edelcup said for us to advance funds we have to advance it on some instrument, and some instrument has to be created. Commissioner Scholl said they are saying it is going to be an unsecured obligation. Mayor Edelcup said we need to know how we are going to do it before we can even commit to doing it,there has to be some mechanism set up. Commissioner Scholl said that it might be interesting to see what the deal with Miami was in terms of the legal instrument because clearly that wasn't collateralized. Vice Mayor Thaler said that you have stated that you are working with two other cities, where do they stand and what are they getting to collateralize it, and Ms. Rijo-Conde said that they are basically of their dealings with the CRA for the City of Miami and that entails the possibility of replacing a whole school with a different type of school,and they have their own debt issuance mechanism. The revenue stream for them is the tax increments that they are getting off from above and beyond their program. We are not at the point where we worked out all of the instruments, we are almost at the same level as all the municipalities. She is certain that their Treasurer and finance people could come up with something that would be acceptable to both parties by having some conversations and dialogue with your finance people. Mayor Edelcup said where he thinks we are at is that we would all like to see the expansion of the school take place, we set some preconditions that we already talked about at the beginning of our meeting. We are at a position now where we probably could do the financing in some form or fashion, but again like you we are dealing in public money and so we need to know what is the legal instrument that is going to get created that represents this transfer of money from us to you and how it is getting paid back. Ms. Rijo-Conde said that they were waiting for this confirmation from the Commission, and now that there is interest in going to the next level then the next step is to get their Treasurer and Finance people and the City's Finance people together. Commissioner Scholl said he thought all we were going to do was to provide debt,he has not come to grips to the fact that we are going to make another contribution based on the contribution we already made which was quite substantial to begin with. From his perspective, given the fact we deal with a lot of the other preconditions like the Mayor just mentioned, we would look to give you debt instrument for the total cost. As a Commission we will have to decide, now he understands that they are asking for us to forgive half the cost up front, and that is not where his head is at but it is something they will have to debate. 8