INCORPORATION Q&A: Incorporation Study Group

1. What is the effect on Manatee County should Lakewood Ranch incorporate?
Incorporation is a win-win situation, because Manatee County will share in the residential growth, increased property assessments and commercial synergy to the two-county area that incorporation will enhance. Lakewood Ranch constitutes only 5% (17,000 of 322,833) of the population of Manatee. Florida’s municipal revenue sharing flows directly from a state trust fund, and the county would lose no funds. Five percent of the motor-fuel and sales-tax revenue sharing would be taken from the county’s share, but the county would no longer have to maintain local roads in Lakewood Ranch. We will continue to pay taxes to the county for the sheriff’s services, schools, libraries and parks. We also will pay the county for solid waste and water and sewer services, so incorporation would have no effect on those county jobs or the revenue stream to the County.

2. Should incorporation pass, how do you envision your role in the new government?
Thomaides: I have no desire to ever run for any kind of political office.

Davey: Based on my experience and knowledge as a member of the study group, I would volunteer to assist with the transitional activities required to successfully become the city of Lakewood Ranch. I have not made any other decisions at this time.

All other members of the group have indicated they do not intend to run for City Council.

3. What are the specific problems with the way that Lakewood Ranch is currently being managed that would warrant a substantive change?
The current management system with five CDDs (25 CDD supervisors) and the IDA is fragmented and ineffective as documented in recent CDD and HOA workshops.

CDDs have no long-range plans. Aging infrastructure and major landscaping issues will need to be addressed. Adequate reserves have not been established to cover contingencies or necessary infrastructure maintenance/ replacement. The overall look and feel of the Ranch has been declining for several years. CDDs have a limited ability to borrow money. The only way CDDs can increase revenue is to raise taxes. They have no other sources of revenue.

A five-member council would replace the 25 CDD supervisors and IDA. Many safety and security issues could be improved with the passage of local ordinances and increased patrol services contracted on a citywide basis with the sheriff. Zoning and code compliance would be controlled by the city. The city could establish lines of credit and issue bonds at more favorable rates. The city would be able to start building appropriate reserves for natural disasters without needing to raise taxes. Public roads would be paved by the city, instead of waiting for the county. The City Council would be able to ensure that the overall look and feel of the Ranch is maintained at a consistent level as we continue to grow.

4. If the straw poll shows the majority of residents oppose incorporation, how will your group respond?
If the straw vote fails, we will disband and put our work on the shelf. It is possible that another group will take the matter forward at a future time.

5. Why is the proposed city charter is the best option for Lakewood Ranch becoming a city?
We studied more than 50 charters and focused on the demographically similar city charters in Weston, Bonita Springs, Wellington and Palm Coast. It was clear these newer communities adopted a viable system, and we came to the same conclusion — that professional management through the council (as policymakers) and city manager (as administrator) was the most effective way to operate a city. All 24 cities incorporated in Florida since 1984 have chosen this council/manager form of government. Five districts with residency requirements and citywide voting would assure the council members have a citywide view.

The contract city concepts in practice in Weston, Sandy Springs, Ga., and other cities across the country allow these cities to more effectively respond to economic upturns and downturns and avoid labor issues, employee benefit cost and other problems. The city government would not be another layer of government because the CDDs will be transitioned to a city council-governed special district. The existing CDD boards as well as the Inter-District Authority would be eliminated.

6. Dr. Hank Fishkind mentioned risks in his feasibility study conclusion, but nowhere in the 45 pages does he have a table, figures or text regarding those risks. What are these risks?
Because the purpose of a feasibility study is to determine financial viability of incorporation, the primary potential risk would be a major flaw in the validity of the data, assumptions, methodology or calculations contained in the study. To that point, the study was conducted by one of the leading economists in Florida. Estimates used were intentionally conservative (revenues low end/expenses high end). Our group spent months reviewing the study to confirm we understood the details and were comfortable before moving forward. We performed a sensitivity analysis assuming zero growth for the next 10 years. We also contracted with Dr. Tim Chapin, chair of the Department of Urban and Regional Planning at FSU to conduct an independent evaluation of the study.

When submitted to the Florida Legislature, committees will perform their own review and reject the study if they find any issues.

7. What is your funding source?
Since the study was published, 52 contributions totaling $31,600 have been received from residents and businesses. These have been used to fund Dr. Chapin’s report, development of formal city and district boundary descriptions, the straw poll, IRS filing requirements and advertising.

8. Explain the effects of incorporation on small-business owners.
Incorporation would be extremely beneficial for the business community. It immediately raises the overall stature and brand identity of the Ranch. Decision-making responsibility will be with a five-member City Council — all residents of the Ranch — versus Manatee and Sarasota commissioners. The Ranch could become a hub for business activity and economic leadership on the Gulf Coast. As a city and a brand, the Ranch will be a player at local and national industry conferences to promote the Ranch, specifically, and not just the two-county area. We will have access to state block grant funds and tax incentives to bring new corporations to the Ranch.

9. Is there a problem with the amount of reserves the CDDs have currently?
CDDs are responsible for maintaining appropriate reserves to cover unanticipated expenditures, revenue shortfalls, maintenance/replacement of infrastructure, as well as contingency reserves in case a natural disaster occurs (such as a hurricane). The Government Finance Officers Association recommends an unrestricted reserve balance of a minimum of two months of general-fund operating revenues or expenditures. Restricted reserves for infrastructure items should be based on estimated useful life and repair/replacement cost. Reserves should be built over time. If the above criteria are applied to the CDDs today, there are major shortfalls. And it’s actually going the wrong way. Total CDD reserves as of Sept. 30, 2010, were about $2.21 million. As of May 31, CDD reserves were about $1.64 million — a decrease of more than 25%. By comparison, Palmetto, with a smaller population than the Ranch, had reserves as of Sept. 10, 2001, of more than $17 million.

10. Are five City Council members enough representation for residents of Lakewood Ranch?
The Florida Legislature uses the charter model of The National Civic League, a nonpartisan national organization, to review city charters. The league has long recommended a council/manager form of government with a small responsive council as the most efficient method of governance. They state that a small council is a “more effective instrument for the development of programs and conduct of municipal business than larger municipal bodies." Most of the cities that have incorporated in Florida in the past 25 years have chosen a five-member City Council.