Submitted By: Emory Roberts
presenter
Presentation By: Emory Roberts
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Department: Budget
STAFF RECOMMENDATION (Motion Ready):
title
Adopt Budget Resolution 2025-102 amending the Fiscal Year 2023-24 budget to support additional expenditures for the fire fee reimbursement process through a transfer from the General Fund Reserve for Contingencies account totaling $54,646
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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.
On February 11, 2022, the court approved a Class Notice of Final Hearing to distribute refunds, attorney’s fees, costs, and class representative service awards. The city was required to mail the Notice of Final Hearing to each class member within 30 days. A contract was requested with The Notice Company, Inc. for a Class Action Notice (the “Original Contract”) with a maximum initial expenditure of $50,000 to meet this requirement.
Council approved an extended engagement of The Notice Company, Inc. for Claims Administration services on May 17, 2022, with a maximum contract value of $200,000 (referred to as the "First Amendment").
On December 20, 2022, the Council approved additional contract expenditures of $275,000 for continued engagement of The Notice Company, Inc. up to a maximum contract expenditure amount of $475,000. This expenditure ceiling was established based on estimates of future services.
On February 9, 2024, the City assumed responsibility for the re-issuance of first distribution refunds. The City and The Notice Company agreed to a reduction of services and fees for 180 days to cover outstanding checks issued by the Notice Company and to complete the reconciliation during August 2024.
FINDINGS AND CONCLUSIONS:
As of October 1, 2023, the City has spent $54,645.25 on contract expenditures for claims administration services with The Notice Company. This amount includes costs related to the extended refund distribution phase up to August 21, 2024, as well as the final invoice covering agreed-upon expenses, including a Court declaration and the final reconciliation. The City received the final invoice from The Notice Company on September 13, 2024.
Additional funds are required to support final expenditures related to the fire fee reimbursement process.
FISCAL IMPACT:
Funds are available from the General Fund Reserve for Contingencies to support the expenditure of an additional $54,645.25.
001-099-999-513-81-99800 ($54,646)
001-099-950-999-81-31010 $54,646
PROCUREMENT REVIEW:
N/A
LEGAL REVIEW:
N/A
ALTERNATIVE:
• Adopt with Changes
• Table
• Deny
BUDGET RESOLUTION 2025-102
A RESOLUTION AMENDING THE FISCAL YEAR 2023-24 BUDGET TO TRANSFER FUNDS FROM THE GENERAL FUND RESERVE FOR CONTINGENCIES TO SUPPORT ADDITIONAL EXPENDITURES FOR THE FIRE FEE REIMBURSEMENT PROCESS TOTALING $54,646
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, on December 20, 2022, the City adopted Budget Resolution 2023-114 for $275,000 of expenses for The Notice Company Inc.; and
WHEREAS, budget reserves will be used to support the additional unforeseen expenditures incurred in fiscal year 2023-24 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 Fiscal Year 2023-24 budget be amended as follows:
SOURCE:
001-099-999-513-81-99800 Reserve for Contingencies ($54,646)
USE:
001-099-950-999-81-31010 Professional Services - Other $54,646
This resolution adopted this ______ day of ______________________, 2024.
ATTEST: CITY OF OCALA
By: By:
Angel B. Jacobs Barry Mansfield
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