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Judge rules in favor of city in bond validation

By Staff | Dec 11, 2013

A key component of the city of Cape Coral’s revenue diversification plan received its sought-after legal nod Wednesday.

Judge Keith Kyle ruled in favor of the city in the controversial fire service assessment case to the delight of city officials and staff and the chagrin of those who questioned its validity.

City council had approved the new levy on properties within the city and then sought legal validation through the courts that the new revenue source could be used to guarantee a bond to be issued to fund capital improvements for the fire department. In essence, the ruling says the city’s actions in approving the assessment, the methodology it used to determine the amount to be levied per property, and its intention to use the funds raised as a bond guarantee pass legal muster.

Kyle’s 38-page ruling states, “(1) The City of Cape Coral has the legal authority to issue the bond and assess properties within its jurisdiction as requested, (2) that the intended purpose of the bond is legal, to wit, it shall provide a continuation or provision of fire safety related service for all affected parcels, and (3) that the issuance of the bond and its related process comply with all essential elements and requirements of law, including reasonable apportionment.”

The interveners – those who challenged the assessment – have 30 days to issue an appeal to the Florida Supreme Court. Should they file, the money collected by the city will be held in escrow until the high court rules.

For the city, it was a huge victory, since the city was able to prove the “ready-to-serve” methodology was a sound one, and can now deal with its infrastructure and capital needs.

“We have said we believe this methodology is the most fair and equitable method to use to determine the cost of fire services,” city spokesperson Connie Barron said Wednesday. “The FSA has always been a key part of our goal for financial sustainability. If we didn’t have the FSA, we would have a city council trying to determine where to come up with the $12 million shortfall.”

“The decision was of incredible importance to the city. The approach of financial diversification was prompted out of necessity,” said Chris Roe of BryantMillerOlive, the firm that represented the city and is the authority on the “ready-to-serve” method of determining how properties will be assessed. “It looks like they won’t have to consider wide-scale layoffs as they were looking at.”

Mayor Marni Sawicki said the citizens are the winners, although the thought of paying another $150 per average home may not sound so appealing.

“This ensures out financial sustainability for years to come, and now we can address our long-neglected capital needs,” Sawicki said.

Sawicki said the council did not know the decision would come before hiatus, which begins after Monday’s meeting, but now that a decision has been made, the staff can get its plans into motion and have something by the time council gets back in session in January.

“We’re going to go ahead with the budget amendment and prepare the billing so when the 30 days are up we can move forward,” Sawicki said.

For the interveners, the news obviously didn’t sit as well.

Former Cape councilman Bill Deile had yet to read the verdict and wasn’t prepared to say what his next move would be until he had a chance to digest things.

He didn’t keep his disappointment a secret, though, calling it another money grab on the part of the city.

“What disappoints me is they put this forth in the guise of a fire assessment and that’s not what they’re doing. They’re using it to build roads,” Deile said. “If you sell someone an automobile, you expect to be able to drive it and get the benefit of that. This is not the case. It’s another of the dishonest things the city has done this for so long that they no longer recognize it.”

Former councilmember and fellow intervener Chris Chulakes-Leetz seemed to accept the judge’s decision, but added the malaise of the city’s registered voters had something to do with it.

“The people will have to pay. The question of the law has been answered. I’m satisfied. We move on,” Chulakes-Leetz said. “We have 88,000 citizens who don’t care because they didn’t care to vote. So, I’ll have to understand the majority doesn’t care and move on.”