BY MARCY SHORTUSE - The hot topic of how to pay for Boca Grande’s new bridges drew a crowd of more than 80 people to the Boca Community Center Auditorium on Valentine’s Day, but many audience members left the meeting with just as many questions as they had when the walked in the door.
At the onset of the meeting new chairmen were elected. David Hayes was named as the new chairman of the board, while Ginger Watkins will serve as the new vice-chair. Peter Strong will serve as chairman of the engineering committee, and Pete Saeger will head up the referendum committee.
Duane Draper, a representative from the bridge authority’s bond council, also gave a presentation regarding the Bank of America loans that would be needed to fund the replacement bridges. GIBA board members had been emailed the 48-page document the night before the meeting, so they were aware of its contents.
“This loan agreement has been thoroughly vetted, and we feel very comfortable with it,” he said. “Our only concerns are mechanical issues at this point, such as Sunshine certificate worries. While it’s important to make sure everything is done in accordance, we see no prohibitive conflicts of interest. We are very comfortable with recommending the board proceed with the document.”When one audience member, Kevin Hyde, asked how they could feel so comfortable with loan agreement terms before an actual final loan amount was decided upon, Draper explained.
“The language of the loan agreement will not change,” he said. “Not one word, other than suggestions the board has made.”
When another audience member asked if the loan was unsecured, and if Bank of America could take over the bridge if GIBA couldn’t pay off the loan, Hayes had an answer that seemed to reflect the board’s attitude as well.
“I hope they do,” was his tongue-in-cheek response. “That would be great.”
It was further explained that the loan would be secured, and while the bank would be able to seize assets from GIBA’s coffers, they could not foreclose on the entire bridge system.
Jonathon Hart, an accountant with Wilbur Smith, also gave a presentation on their findings from the toll survey. He compared the Sanibel bridge replacement project and the ensuing toll increase with what Boca Grande might be in for, though he admitted comparing the two was like comparing apples and oranges.
The highlight of his presentation was the fact that Sanibel’s bridge traffic had decreased by only 9.6 percent in the wake of their toll increase to $6. When asked about how traffic was affected by Boca Grande’s latest toll increase, which took place in fiscal year 2010, he said that less than a one percent decrease in traffic was reflected.
Jim Cooper, the executive director of the bridge authority, agreed with Hart’s assessment.
“Even if we attribute every lost transaction to just the rate increase, which is not the case, you have a rate elasticity which is infinitesimally small,” Hart said. “If we were to control that number with other factors, you would see elasticity approaching zero.”
Hart said his firm would also be conducting a “non-peak-season” survey later on in the year, in order to provide some quantitative analysis, and to determine who is crossing the bridge during that time of year, and why.
Hayes said he had conducted his own personal research in the last two months, and had spoken with some of the island’s biggest business and property owners. He said, across the board, they were in favor of just a quarter-mill tax increase (which would be $250 more in taxes per million dollar value on a home) and raising the toll to $6. He did say, though, that he said he was still working on other numbers combinations.
“If we go any higher, I don’t think they’ll pass the tax,” he said, referring to the potential ad valorem increase to be proposed on this November’s ballot. “And if they don’t pass it, the tolls will go much higher than $6.”
In order for an ad valorem tax to pass on the November ballot, it would have to be approved by 50% plus one of registered voters who came to the polls.
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