Manatee County Government Administrative Center Honorable Patricia M. Glass Chambers, First Floor 9:00 a.m. - October 8, 2019
October 8, 2019 - Regular Meeting
Agenda Item #35

FY 2020 Beach Renourishment Projects - Letter of Financial Capability


Contact and/or Presenter Information
Charlie Hunsicker, x6001
Director, Parks & Natural Resources Department

Action Requested
Approval and authorization for the Chairman to sign the financial capability letter for the FY2020 Beach Renourishment Projects.

Enabling/Regulating Authority

Background Discussion

Manatee County is partnering with the Army Corps of Engineers as the non-federal sponsor to two agreements to conduct beach renourishment projects on Anna Maria Island beginning in the Spring 2020.  The first project consists of a federal design and managed project within the federally authorized beaches between 78th Street North on Holmes Beach to approximately 5th Street South in Bradenton Beach. This is referred to as the "Central Beach Project." Funding for this project is comprised of a 59.05% federal share, a 20.475% state share, and a 20.475% local share.  The second project consists of renourishment beginning where the federally authorized project leaves off at 5th Street South in Bradenton Beach and continues south to Longboat Key, referred to as the "Coquina Beach Project." This project will be funded by a 50/50 State and County share.  The source of funding for the County share in both cases is the Tourist Development Tax.

The Army Corps of Engineers (ACOE) has agreed to conduct both the federally authorized Central Beach project and the County/State Coquina project under authority which allows local sponsors to request “betterments” or additions to project scope at 100% non-federal expense.  Conducting both projects in sequence saves Manatee County and the State of Florida significant expenses for a second contractor mobilization if the projects were performed separately at different times.  Because of the heavy equipment and ocean-going vessels utilized for beach renourishment work, these mobilization expenses can exceed five million dollars.

To conduct both renourishment projects, it requires considerable financial commitment by all parties.  A cost breakdown based on ACOE project estimates for both projects are included in Attachment 1, dated September 13, 2019.

Federal law requires that the non-federal partner (Manatee County) provide, in advance, the full non-federal cost before the project can proceed, executed through a Project Participation Agreement (PPA) for the Central Beach federally authorized project and a Memorandum of Agreement (MOA) from the Coquina Beach Betterments Project.  The draft PPA for the Central Beach project states in Article II.b. Obligations of the Parties that,"...the Non-Federal Sponsor, in accordance with Article IV.C., must provide funds sufficient to cover the costs of such work in advance of the Government performing the work."

The draft MOA Agreement for the construction of the Coquina Beach project states, "The Non-Federal Sponsor may request in writing that the Government perform betterments or additional work on behalf of the Non-Federal Sponsor.  Each request shall be subject to review and written approval by the Division Commander for South Atlantic Division (hereinafter the "Division Commander").  If the Government agrees to such request, the Non-Federal, in accordance with Article IV.C., shall provide funds sufficient to cover such costs in advance of the Government performing the work."

While the draft PPA and the draft MOA are circulated between the parties for review and final approval, the ACOE has requested a written commitment from the County in the interim that assures it has the financial capability to carry out both the Central Beach and Coquina Beach projects and the ability to forward fund the total amount of the non-federal share (comprised of both the State and local contributions for the Central Beach and Coquina Beach), as the non-federal project sponsor.  This written commitment is attached as Attachment 2.

Federal funds to conduct the Central Beach renourishment project were provided in response to many local sponsor needs across several states along the Atlantic seaboard and Gulf of Mexico. These areas experienced several beach erosions from hurricanes such as Irma in 2017.  Many local communities affected did not or do not have the financial capability to fund the full federal share with financing or lending options available to them.  With this in mind, Congress wrote a special provision into the Hurricane Irma Supplemental Appropriation Bill which allows the local sponsor to obtain an interest-bearing loan provision with up to 30 years for repayment of the non-federal share.  In Manatee County’s particular instance, we rely on the State of Florida appropriations to support roughly 50% of the non-federal share on a reimbursement basis, approved on a year-to-year budget with legislative appropriation.  Current Florida law allows up to three years from the completion of a project to secure full reimbursement of the state share in a competitive grant appropriations process.  Because of the financial and political uncertainty of extending the ability to obtain state share funding with what could essentially be up to a 30 year structured payment and reimbursement proposal, it is not recommended that Manatee County accept the option of up to a 30 year financial plan offered in the Hurricane Irma Supplemental Funding Bill.  The Corps has asked us in our letter of financial capability to affirmatively accept or reject a 30-year financing option and our attached letter prepared for Board consideration rejects the option.  The draft letter in Attachment 2 states that we do not intend to exercise the 30-year non-federal/state payment option.

Once the recommended letter is executed by the Board, the Corps will complete the final PPA and MOA agreements and return the final documents to the County Commission meeting for execution of both agreements.  It should be noted that the draft PPA and draft MOA in their current forms have been reviewed by the County Attorney’s office and returned with comments to be incorporated into the final draft.  On the basis of County Attorney review, we state in the commitment letter that we have reviewed the draft PPA and MOA and accept the terms and conditions, subject to final reconciliation of project cost estimates.  The final documents with edits recommended by the County Attorney will be presented for Board approval during the November 19, 2019, meeting of the Board of County Commissioners.

County Attorney Review
Formal Written Review (Opinion memo must be attached)

Explanation of Other

Reviewing Attorney

Instructions to Board Records
Please email a copy of the Board  approved agenda packet to Jennifer Rebokus-Scott at jennifer.rebokusscott@mymanatee.org.

Cost and Funds Source Account Number and Name

Amount and Frequency of Recurring Costs

Attachment:  CAO opinion.pdf
Attachment:  Attachment 1.pdf
Attachment:  Attachment 2.pdf
Attachment:  Cost Obligation Summary.pdf