Submitted By: Emory Roberts Jr.
presenter
Presentation By: Tammi Haslam
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Department: Budget
STAFF RECOMMENDATION (Motion Ready):
title
Adopt Budget Resolution 2023-114 amending the Fiscal Year 2022-2023 budget to support additional expenditures for the fire fee reimbursement process through a transfer from the General Fund Reserve for Contingencies account totaling $275,000
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OCALA’S RELEVANT STRATEGIC GOALS:
Fiscally Sustainable.
PROOF OF PUBLICATION:
N/A
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BACKGROUND:
On February 20, 2014, Class Representatives filed a class action lawsuit against the City challenging the City’s Fire Fee as an unconstitutional tax imposed in violation of Article VII, Section 1(a) of the Florida Constitution. Class Representatives requested the trial court declare the Fire Fee unlawful and order class wide refunds to the greatest extent permitted under law.
On June 19, 2020, the Fifth DCA, in a 14-page appellate decision, reversed the trial court
and ruled the City’s Fire Fee was an unconstitutional tax. On October 11, 2021, the Court held a hearing on Class Representatives’ Motion to Compel the City to Fund the Common Fund. The Court found the Fifth DCA’s mandate was the final judgment in the case, the Fifth DCA had resolved all legal issues and properly considered and disposed of all the City’s defenses. The Court granted Class Representatives’ motion, determined the City had collected $79,282,909.44 in illegal taxes from class members since February 20, 2010, and ordered the City to deposit the illegal taxes into a separate fund (the “Common Fund”) within sixty (60) days to be disbursed upon further order of the Court.
The Court reserved jurisdiction regarding all remaining aspects concerning management
of this class action, including disbursement of the Common Fund and payment of refunds, class
representative service awards, attorneys’ fees, and costs.
Additionally, the Court ordered the City’s reimbursement process to begin no later than 60 days after the final order date.
FINDINGS AND CONCLUSIONS:
On June 13, 2022, the City entered into a third-party agreement with The Notice Company, Inc. to begin the reimbursement process to all class members. On July 5, 2022, City Council passed Budget Resolution 2022-158 to allocate funding for $200,000 of expenses for The Notice Company, Inc. services. Additional funds are required to support expenditures related to the fire fee reimbursement process.
FISCAL IMPACT:
A transfer from the General Fund Reserve for Contingencies is needed to support the additional expenditure up to $275,000.
001-099-999-513-81-99800 ($275,000)
001-099-950-999-81-31010 $275,000
PROCUREMENT REVIEW:
N/A
LEGAL REVIEW:
N/A
ALTERNATIVE:
• Adopt with Changes
• Deny
• Table
BUDGET RESOLUTION 2023-114
A RESOLUTION AMENDING THE FISCAL YEAR 2022-2023 BUDGET TO TRANSFER FUNDS FROM THE GENERAL FUND RESERVE FOR CONTINGENCIES TO SUPPORT ADDITIONAL EXPENDITURES FOR THE FIRE FEE REIMBURSEMENT PROCESS TOTALING $275,000
WHEREAS, Florida law provides that the party recovering judgement shall recover all legal cost and charges; and
WHEREAS, on June 19, 2020, the Fifth District Court of Appeals reversed the Trial Court’s decision and ruled the City’s Fire Fee was an unconstitutional tax; and
WHEREAS, on October 11, 2021, the Court held a hearing on the motion for the City to create a Common Fund; and
WHEREAS, the Court granted Class Representatives’ motion for judgement totaling $79,282,910; and
WHEREAS, on March 1, 2022, City Council approved a taxable draw-down loan totaling $60 million; and
WHEREAS, the City had until April 4, 2022 to fund the Common Fund; and
WHEREAS, the City had to mail notices to all class members; and
WHEREAS, the City had to begin the reimbursement process to all class members within 60 days of final judgement; and
WHEREAS, on June 13, 2022, the City entered into an agreement with The Notice Company, Inc. to process reimbursements to all class members; and
WHEREAS, on July 5, 2022, the City passed Budget Resolution 2022-158 for $200,000 of expenses for The Notice Company Inc.; and
WHEREAS, budget reserves will be used to support the additional unforeseen expenditure incurred in fiscal year 2022-2023 for the fire fee reimbursement process that was a result of the judgement.
NOW THEREFORE, BE IT RESOLVED THAT THE CITY COUNCIL OF THE CITY OF OCALA, FLORIDA, duly assembled in regular session, that the FY22-23 budget be amended as follows:
RESOURCE:
001-099-999-513-81-99800 Reserve for Contingencies ($275,000)
USE:
001-099-950-999-81-31010 Professional Services - Other $275,000
This resolution adopted this ______ day of ______________________, 2022.
ATTEST: CITY OF OCALA
By: By:
Angel B. Jacobs James P. Hilty Sr.
City Clerk President, Ocala City Council
Approved as to form and legality:
By: _________________________________
William E. Sexton.
City Attorney
Reviewed for accounting accuracy & completeness:
By: _________________________________
Peter A. Lee
City Manager