City of Sanford officials considered their options, and the financial impact of the recent county decision to terminate several interlocal government agreements, during Wednesday's meeting of the Council's Law and Finance Committee.
Sanford City Council members discussed complying with the requests from the Lee County Board of Commissioners, renegotiating for mutual benefit or ending several interlocal agreements entirely during Wednesday's meeting. The committee agreed to continue the discussion into next week to formalize a response.
The Lee County Commissioners unanimously voted to terminate several interlocal government agreements with the city during its meeting Dec. 3. Lee County Manager John Crumpton sent a formal letter to notify the city that interlocal agreements concerning community development, planning and zoning, building inspections, tax collection, GIS and animal control were set to end effective June 30, 2012.
The city compensates the county for GIS, tax collections, a lease agreement at the Woodland planning office and animal control for a total of $344,741, according to documents provided by Sanford City Manager Hal Hegwer. The county compensates the city for planning and zoning, community development, inspections services and a lease agreement at the federal building for $458,602, he said.
If the city were to negotiate the agreements to the county's satisfaction — which include reducing the county's share of the planning and development cost from 45 percent to 30 percent, installing a 2 percent flat rate for tax collections, the city paying 50 percent of the GIS cost and increasing the fee of animal control by $30,000 — it would see an approximate expense increase of $350,000, according to Hegwer.
A second option is to tailor the agreements to both parties' interests, which may include Lee County assuming animal control because "they currently provide this service to unincorporated Lee County residents and the town of Broadway for no additional fee," and the city "paying a fair and equitable amount for the collection of (the city's) taxes," according to a city staff memo.
If the city were to end the interlocal agreements with the county, the city would lose $100,000 in revenue from the county but be able to cut $500,000 through reductions in personnel and operating costs in the inspections and planning departments, Hegwer said.
The interlocal agreements were meant to provide an improvement in the quality of service, even if it was slightly more expensive, he said.
"They have undergone, just like we have, a recession," Hegwer said. "And they look at things a little different. . . Part of the consolidation effort you've had over the years was to provide quality service, not necessarily the cheapest service."
The two government entities may go their separate ways in terms of interlocal agreements and find incremental savings, but quality could suffer, he said.
"We are at different philosophies, and we respect their difference of opinions," Hegwer said.
Along with the potential for a change in the sales tax redistribution from the population-based per capita model to ad valorem method, the city will see significant changes to its budget, according to Hegwer.
Given the possible changes to the sales tax redistribution and the interlocal agreements, the issue of fairness must be addressed, said Sanford Mayor Cornelia Olive. Sanford is not an island within the county, and its prosperity directly impacts the prosperity of the county, she said.
"It seems to me like it's almost ransom that can be held over our head every April when they decide (to change the sales tax redistribution)," she said. "There is a blatant unfairness in that decision."
Olive said she does not want an adversarial relationship with the county and the cohesiveness between the two boards previously have helped all residents.
Councilman Samuel Gaskins said the possible sales tax redistribution and change in interlocal agreements would transfer nearly $2 million from the city to the county, or nearly 10 percent of the city's annual operating budget.
"Over half (of the budget) is what we use for police and fire," he said. "Obviously when you are looking at nearly 10 percent of the funds, they are making a rather rash move to take city funds."
Councilman Charles Taylor asked Hegwer how the city and county reached this impasse and what discussions led up to this point. In the memo sent to Hegwer, Crumpton said the county has not received formal response to the county's concerns dating back to 2011.
Hegwer said the agreements have been discussed many times by the boards, and city council was notified of these talks. Some officials from Lee County, City of Sanford and Town of Broadway met informally to discuss these items in recent months, he said.
Lee County Commissioner Chairman Charlie Parks said during those meetings the city and Olive stonewalled the discussions concerning the interlocal agreements and "have demonstrated a lack of leadership."
"They need to come to the table, be truthful and be ready to work out some positive things, or else we will have no choice," Parks told The Herald Wednesday.
Olive said she disagreed with Parks' assessment, but would not elaborate.
Parks said the city canceled the last scheduled get-together with the county, preferring to wait to see the outcome of the November election — which added three new members to the county's board.
"We really tried," he said. "These have been fought for the past three years, and it is a disservice to not have them updated. It's a waste of taxpayers' dollars and they stonewalled us."
The Sanford City Council is scheduled for is regular meeting at 7 p.m. Tuesday at the municipal center, located at 225 E. Weatherspoon St.
In other matters, council considered:
* A financial audit presentation for the city which showed an unqualified opinion, the highest rating for a municipality, and a cooperative staff, according to Crystal Waddell of Martin Starnes & Associates.
* Architectural renderings of skateparks from five vendors and a presentation by council member Charles Taylor on possible park alternatives.
* Endorsing the Solid Waste Management Plan for 2012.
* A request for abatement for late property tax listing penalty for Parinaz Nasseri.
* Taxicab operator's license renewal for 2013. Three taxicab companies, Service Cab, American Yellow Cab and Pronto Taxi, submitted their requests and no violations of the law were found, according to the agenda item in a staff document.