City of Satellite Beach Seeks Brevard County Approval To Dip Into CRA Funds

SATELLITE BEACH, Florida --  The City of Satellite Beach wants to return its unused Tax Incremental Redevelopment Trust Fund (TIF) funds from its Community Redevelopment Agency (CRA) back to the City at the end of the year to replenish the City's low reserves.

Because this financial plan involves County funds in the CRA, the City has proposed an interlocal agreement with Brevard County that would permit such a use of those funds while also settling any potential claims the County may have against the City for past misuse of CRA funds.

As reported by Brevard Times last month, Brevard County Clerk of Court Scott Ellis wants to audit the City of Satellite Beach to determine if there was additional misuse of CRA funds by the City.  Attorneys for both the city and the CRA questioned Ellis' right to audit and have called him “prosecutor, judge, and jury of one.”

“We have been looking at the Satellite Beach CRA for many months,” Ellis told Brevard Times.  “In response, they ran to the County Commission with an ‘interlocal agreement,’ which deceptively claimed returns on future revenues as returns of past revenues unlawfully spent.”

The proposed interlocal agreement, which also doubles as a legal settlement agreement between Brevard County and Satellite Beach, has been placed on the Board of County Commissioners' August 20, 2013 Meeting Agenda.  If approved, the County would agree to:

(5)...release the CITY and CRA of and from all actual or potential claims of any nature whatsoever regarding the allegedly improper TIF payments received by the CITY from the CRA. Without limiting the generality of the foregoing, and upon full and complete payment to the COUNTY as provided in this Agreement, the COUNTY also remises, releases, acquits, satisfies and forever discharges the CITY and CRA from any and all actual or potential actions, causes of action, claims, suits, liabilities, judgments and demands, whether in law or in equity, whether known or unknown... (Emphasis Added.)

(6) ....not commence or maintain any suit, action or proceeding with respect to any claim that it may have against the CITY or the CRA that accrued prior to the date of this Agreement as it relates to the questioned payments received by the CITY from the CRA.

"The County authorized the creation of the Satellite Beach CRA and in doing so, the CRA was entitled to receive the ad valorem tax increment (ad valorem taxes collected each year in excess of base year collection) during the term of the CRA," Brevard County Attorney Scott Knox said in an email.  "Despite the CRA's entitlement to funds (that were apparently appropriated by the City for public safety related purposes) the CITY has agreed to pay the COUNTY  (as opposed to the CRA) a sum equal to the county component of the CRA funds that went to the CITY public safety programs-which is why the County would enter into the agreement not to sue.  The agreement assumes the COUNTY did, in fact, have a right to claim the money to begin with-though that is an open question since there is an argument that the COUNTY is not entitled to those funds at all, having enacted an ordinance relinquishing the money to the CRA."

Brevard County Manager Howard Tipton said in an email that his opinion of the agreement, based on the information he has available, is that the Board should considering accepting it.

"I have told both Mr. Knox and Deputy County Manager Stockton Whitten a few times they are being deceived," Ellis said.  "The whole agreement is a fraud.  Knox, falling for the Satellite Beach company line, refers to the 2014 transfer as a 'repayment'.  It is not.  The money to the County for 2014 is money owed from the 2014 CRA revenues.  It is NOT a repayment of some skim from 2007.  All the City is paying the County is what they owe back from current revenues being taken."

UPDATE: The interlocal agreement was approved by the Board 3 to 2.  County Commissioners Robin Fisher, Mary Bolin, and Chuck Nelson voted in favor of the interlocal agreement.  Commissioners Andy Anderson and Trudie Infantini voted against approval.

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