One comment: “It didn’t go the way I thought.”
Next up:Modifying the city’s travel procedures.
Kisela; “Instead of bringing back receipts and all that documentation, this is a straight per diem.” And it’s within IRS guidelines.
Wood: How will mileage be calculated? Kisela: It’s a per/mile rate based on the price of fuel. Goes up and down with the price (much as at The Log).
Seevers: You changed the word “dinner” for “supper”in the ordinance. Bragg Farmer, finance director: “It means the same thing” but as a southerner, he prefers supper.
Unanimous.
Next up: A grant that would put more traffic patrols on the road. Seevers makes a motion for the city manager to execute the $75,000 grant. Weidenhamer seconds.
Kisela: “What this does, it gives us for fiscal year 2010, $75,000 for that purpose. We’ve been working with the public works/public safety committee” on some of their concerns. It’s about 2700 hours of traffic enforcement “so it will be pretty substantial, not just on highway 98 but throughout our neighborhoods … If you’ve got a heavy foot, you might want to lose it throughout 2010.”
About a third of this will be used in spring break and summer, particularly the heavily pedestrian-trafficked area between Gulf Shore and Airport Road (I think that’s it).
And the motion: Unanimous.
City Manager comments;
Nov. 16, groundbreaking for Scenic Hwy 98 Phase 3.
CRA board meeting for next Monday but it may be deferred.
Coastal Planning, a city consultant may make a presentation soon on the effect of oil drilling on the sand source for beach restoration.
And there’s lots of events still to celebrate this week! check the Log for details!
Comments from the audience; Betty Kenyon gets up. “My daughter … voted against incorporation in 1984. I think I was living in Virginia.”
22nd Oct., she was rear-ended on 98 by an Alabama driver. “Something has got to be done about the speed limit in the city .. from the city limit to the bridge, make it 35 mph an hour, just one consistent speed limit throughout the entire city.” Traffic enforcement is a problem. Since 98 is a state road, who would have to decide?
DOT, several people say. Craig: Federal actually. But we have just approved the added patrols. “We believe it will hopefully accomplish the goal you’re seeking.”
Bagby: If it’s 35mph, I can drive my golf cart!
Trammell: “I feel your pain, but I was sitting at a stop light when I was rear-ended in October.”
And no more speakers–we’re adjourned!

Jim Bagby says it should also include the merits of buying the St. Andrews property.
Unanimous with Dewey and Kelly abstaining.

Kisela reminds everyone this is only one of three sites the city wants to acquire.
Weidenhamer: He would like to see a financial analysis. Even if the lease is half the price of payments, “it’s still cash flow. If we’re spending half of the money we’re spending otherwise, the other half might go to another parking location … There’s only so much cash flow.”
Kisela: We have a financial advisor, we can have him go over the lease. “I hadn’t wanted to spend that money unless there was a policy direction.”
Jim Bagby: “if that was a motion, I will second it, but I will tell you what it’s going to tell us … it’s going to tell us to lease” subject to a couple of technical points.
Kisela: Parking garage costs will be the same on either site. He can bring back an analysis on the parking-lot price in a couple of weeks.
Craig: He doesn’t think the lease is the clear winner when you consider that 30 years down the line, one would still have us owning property.
Trammell: We’ve discussed building condos on a parking garage–would the church be OK with that? Kisela: We would have that right.
Weidenhamer: We need to consider the residual value, but cash flow will be important. “I don’t care what the residual value will be 50 years from now, it won’t buy you more parking spaces today.”
Dewey: 50 years ago, his grandfather sold a harbor parcel for $5,000; today it’s worth $50 million. In the harbor district, residual value can count for a lot.
Seevers: Do we have a closing date for the Clancys?
Miller: No. My position is that you have in your hands the enforcement of the contract.
Seevers: There is a huge value in owning the parcel, and the value is going to go way up when redevelompent starts. How will the analsysis figure that in?
Greg: “I will defer to the financial advisors. This is not the first time someone’s been asked to evaluate lease versus purchase.” The advisor will make the call.

Buying is good, overpaying isn’t, and we’d be playing $3.6 million for a property that’s maybe worth $1 mill today. And “as somebody says, we’ve danced with these folks almost six months, longer than six months–we’re still dancing and I’m tired of dancing.” He’d much sooner see a right-to-own deal worked out with St. Andrews. “I can’t support the Clancy piece, we’ll be dancing here six months from now and paying for a property that might be worth $2.6 million then.”
Dewey: The key points: Which piece is going to be used more? Definitely the Clancy land. With the church we’d need a shuttle probably and to promote it to make the public aware of it.
Second question: How do we get people across the harbor? An overpass is a big decision point (putting one on the St. Andrew’s property is impractical because it clashes with the church’s front entrance).
Craig: Multiple harbor plans have failed in the past. He remembers one group of owners he gathered together to discuss the boardwalk, and the landowners were emphatic that was a no go without public parking.
“This is one of those rare occasions where engineers like Mr. Bagby and I can look at things objectively from a financial standpoint.” It’s simple to look at the debt service compared to the lease payments, it’s not an apples to apples comparison. He’d like to see more due diligence, more thought put into it. “I don’t think we should have a policy directive until we figure out the best deal” based on financial analysis.
Kisela: Can report back on the cash flow, but I don’t want to get into a lengthy debate over discount rates and stuff–that can skew current values.
Barker: I think this is one case where intrinsic values can settle things; if he were voting, it would be based solely on the best deal. But he realizes other values might be in play.
Weidenhamer: Agrees with Bagby about the possible drop in value; could we get another appraisal? Otherwise there might be legal questions.
Miller: “You have an enforceable contract until you vote otherwise and that’s the only face I have to show.” Mr. Bagby’s view does not change his opinion unless a majority votes to change their position.
Windes: We don’t want to bad data to kill us the way it’s killing amberjack fishing. Can we be sure of getting a Tier Two parking fee? Or any Tier Three fees? By the time we know everything we need to know, it might be too late.
Kisela: I would be happy to bring a financial analysis back to you at the next meeting. Windes: But we won’t know anything about the fees.
Kisela: I’m strictly looking at the cost of “the dirt”–not building the garage, just putting the basic spaces on the ground.

“If you can buy it, you’d better buy it, because it’s only going to accrue value down the road.”
There’s only so much distance people will walk from the parking, and the St. Andrews parking lot will probably end up exceeding that. She’s also concerned about the right-to-own parking lot because if we buy it, it would become a nonconforming property: The church wouldn’t have enough parking of its own.
Kisela: He thinks the intent was to give us that option if the church decided to move.
Trammell: And we have the same problem with both properties: When someone slows down to turn, it slows things up. One option is a deceleration lane, but if we put one in at St Andrews, it’ll take part of the parking. “Their driveway is huge” to cope with that.
Generally, she favors the buy. And we have the money, so she’s not worried about it; she is worried about ingress/egress on both properties, however.
Kelly: “This is one leopard who does change his spots.” Bagby’s always keen on buying land when we can, but suddenly he’s Anti?
“This situation is apples to apples”–a winding parking lot on Mountain Drive, a greater distance to walk to the harbor; and we’re going to have money for construction, from one of the Tier Three projects and (if the fee the city has proposed eventually becomes law) from large Tier Two projects.
“What’s in the best interest most of the time of the people long-term in the CRA? It’s not the mountain drive parking lot—if we can swing the deal,” buying is better. “What are we talking about doing? Reneging on a contract we’ve already signed. I’m not changing my spot.”
Seevers: In seven years on council, she’s learned that once you make a mistake by “spending money on something you don’t own” you don’t repeat it. Buying property is a good investment, leasing isn’t, as she tells her kids; putting $50,000 a year into a lease property means “at the end of 50 years, you own nothing—nothing.” That’s a raw deal for the citizens. “People aren’t going to have an investment for the future.”
She wants to try Clancy one more time, then look at the alternatives.
“Another thing that was not brought up, we buy this parcel and there’s nothing that says we, the city council, have to be the ones to build the parking garage. The city could lease it out and have someone run it and eventually build the garage.
Jim Bagby: Kelly’s right, he does prefer buying

If we were building a parking garage now, we might have that problem–it would be more of an issue if the garage were required immediately rather than a long-term plan.
Wood: Could someone negotiate to use that parking as part of their parking requirement?
Kisela: That’s something we’d have to negotiate in a development hearing.
At some point, he adds, the price of parking would probably require charging after the garage started going up.
Bagby: Is there a limit how much we can go over an appraisal?
Kisela; You can pay less than the appraised value. To pay more than appraised value it requires a supermajority. And any purchase over a half-million requires two approvals, which we’ve gotten.
Bagby: What’s the date? “An April appraisal or even a May appraisal is not good in November” given the market–prices have stabilized below the April/May level.
And the cost isn’t just $3.125 million, because there are also Realtor’s fees and construction that puts it up to about $3.6 million.
He thanks St. Andrew’s for the offer, though he predicts “we’ll be wrestling with these choices for a long time.”
Getting back to the deal, Bagby says it doesn’t make sense to buy the Clancy land; maybe in 50 years, we will, but transportation, as Wood says, might have changed a lot. “I’m not willing to bet my kid’s future on that.” It doesn’t make sense from a business perspective, legal perspective; the policy perspective is that the city wants parking on the harbor and promotes more people, fewer cars.
The lease keeps the options open.