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02-12-1993 Utility AppraisalsTO: THRU: THRU: FROM: CITY OF OKEECHOBEE Mayor and Council MEMORANDUM John J. Drago, City Administrator DATE: Feb. 12, 1993 SUBJECT: Utility Appraisal Enclosed are copies of the comments from the City's three consultants regarding the Deighan Appraisal. Also a response from Deighan on our comments. The two basic points to be resolved are: What methodology is going to be used to determine the worth of various equipment and the contribution made to the system by developers. Every member of the City Council would ask the same question if you were going to sell a business and needed an appraisal. Accepting an answer that the appraisal will be done according to customary methods are fine; but what customary method are you going to use. This is the remaining issue. Mayor Kirk has been consistently briefed on all the happenings with the appraisal. Mayor Kirk is going to meet with the Okeechobee News at 4:00 p.m. on Friday, February 12, 1993 to explain the City side of the appraisal. There will be a meeting among the City, Deighan, Mayor Kirk and Commissioner Harvey to brief all parties and come to a conclusion on the methodology to be used to value the system. Earlier in the week I spoke to Dave Rivera about the progress we are making and the two points that need to be clarified. From my conversations with Dave, it appears that he had no problem with our approach and that a resolution would be forthcoming. I spoke to Dave today (Friday, February 12, 1993). He indicated that the County Commission felt that the process was favoring the City. I asked him why specific scope of services were not developed. Dave replied that he gave the appraisers a scope of services that he thought needed to be done. He questioned why the City used our consultants to evaluate the proposal. My response was that I do not have the expertise to evaluate the proposal the same as he did not have the expertise to develop a scope of services. Dave indicated that if the two remaining points can be worked out, then the Commission may reconsider funding the appraisal. Enclosed is a copy of the County Commission Agenda for February 11. There was no item on the Agenda for the Utility Appraisal. ANNEXATION REIORN: ENCLAVES One serious problem with Florida's annexation laws is the treatment of enclaves. Enclaves obscure all hope of achieving effective intergovernmental coordination, and frequently result in poorly managed growth and inefficient although expensive service delivery. An enclave is generally thought of as: (a) any unincorporated area which is totally enclosed within and bounded by a single municipality; (b) any unincorporated area which is totally enclosed within and bounded by a single municipality and a natural or manmade obstacle which prohibits the passage of vehicular traffic to that unincorporated area; or (c) any unincorporated area which is totally enclosed within and bounded by more than one municipality, or more than one municipality and a natural or manmade obstacle which prohibits the passage of vehicular traffic to that unincorporated area. These areas quite frequently resemble islands or pockets of development not fully related to the surrounding area due to jurisdictional differences in planning, regulation and enforcement. While most enclaves are relatively small (about 40 acres), the impact from these areas can be enormous. Studies have shown that in the state's larger cities (greater than 50,000) the pattern of land use in enclaves tends to favor industrial land use (12 percent) and industrial land use mixed with commercial or residential land use (29 percent). Such land uses often result in costly drainage, parking and transportation impacts. Specifically, the problems with enclaves are twofold: (1) enclaves require a high degree of coordination among one or more affected local governments in order to rationally manage growth; the most important issue being facility and service provision. Natural resource protection, economic development ad redevelopment activities, and affordable housing provision are also important factors; and (2) managing growth and development within enclaves tends to be expensive when duplication of certain services occurs, often the consequence of ineffective or failed intergovernmental coordination, and particularly when those costs of services are not equitably distributed among service receivers. That is, residents of municipalities frequently pay for and in fact subsidize the provision of many services to businesses and residents located within the unincorporated enclaves. Elimination of enclaves would be a positive first step in removing unnecessary obstacles to effective intergovernmental coordination in jurisdictions where they exist. In order to eliminate enclaves, the state could establish formal identification of these areas by definition in statute, and then proceed to ease procedures for their annexation into the municipality predominantly responsible for service provision. This in turn will improve the management of growth and development within these areas, including the enhancement of service delivery. Consequently, improved service delivery and managed growth will make more efficient use of scarce tax dollars, and ultimately improve Florida's quality of life.