11/5/18: AGENDA FOR NOV. 7 SPECIAL MEETING ON HIGH-OCCUPANCY HOUSES INCLUDES REPORT ON LEGAL OPTIONS; NEW FIRE STATION COMES IN AT $5.4 MILLION, $334,000 ANNUAL COST TO TOWN ON 25-YEAR LOAN: HOW WILL THE TOWN PAY THE DEBT?

98Ocean
98 Ocean Blvd. in Southern Shores

With all of the talk lately about SAGA’s proposed 12-bedroom, 12-bathroom, 17-parking space, 24-person occupancy, nearly 6,000-square-foot houses at 98 Ocean Blvd. and 134 Ocean Blvd. on the Southern Shores oceanfront, the very important matter of approving and funding a new fire station has been neglected. That will change on Wednesday, when both mega/event houses and the proposed new $5.4 million fire station will command the Town Council’s and property owners’ attentions during a very busy day at the Pitts Center.

The Town Council will finally decide during its regular meeting Wednesday at 5:30 p.m. whether it will approve the conditional use permit (CUP) application submitted by the Southern Shores Volunteer Fire Dept. (SSVFD) for construction of a new fire station at 15 S. Dogwood Trail—the site of the current station. The Town Planning Board already has recommended approval, with conditions. If the Town Council approves the CUP, it will then discuss the Town’s contribution to the financing of the construction project.

According to correspondence from SSFVD Fire Chief Edward Limbacher, which you can find online in the Nov. 7 regular meeting packet, the SSVFD has selected a contractor for the construction job and a lender for the financing. Chief Limbacher is recommending A.R. Chesson Construction Co. of Elizabeth City as general contractor. Among three bids received on the project, Chesson submitted the lowest bid at $5,409,223.

You will find the meeting packet here: https://www.southernshores-nc.gov/wp-content/uploads/2018/11/November-Regular-Meeting-Packet.pdf. (See pages 12-13 for key memoranda.)

SPECIAL MEETING AGENDA

I’ll give you more details about the fire station project, below. First, however, I’d like to share the agenda that was posted on the Town’s website for Wednesday morning’s “special meeting” about high-occupancy houses, which is scheduled at 10 a.m. in the Pitts Center. It is as follows:

Opening—Mayor Bennett

Call Meeting to Order

Pledge of Allegiance

Moment of Silence

Purpose of Special Meeting–Mayor Bennett

The specific purpose of the Special Meeting is for the Town Council to (1) consider all available options, if there are any, to further limit occupancy of single-family dwellings in Southern Shores, and, (2) provide opportunity for any Council member to seek Council approval to initiate the process of adopting a specific option, if available, to further limit the occupancy of single-family dwellings, and (3) allow a period of public comment on the purpose of the special meeting, subject to the Town’s rules for public comment.

General Public Comment (Limit: 3 minutes per speaker)

Town Attorney

Available Legal Options for Town Council to Consider for Possible Further Amendment to the Town Code to Address Future Large Single-Family Dwellings

Council Deliberation (Council may take action on matters within the purview of the Purpose of the Special Meeting.)

Adjourn

This is verbatim from the website posting. See https://www.southernshores-nc.gov/wp-content/uploads/2018/10/Special-Meeting-November-7-2018.pdf.

Why, The Beacon asks, is the Town Attorney enlightening the assemblage about the “available legal options . . . to consider for possible . . . amendment to the Town Code” after the public has spoken? Why cannot we, the tax-paying “public,” hear what the Town Attorney has most certainly advised Mayor Tom Bennett, Town Manager Peter Rascoe, Deputy Town Manager/Planning Director Wes Haskett, and members of the Town Council and the Planning Board about what he believes are legally feasible means to prevent future oversized single-family dwellings, such as those proposed by SAGA Construction at 98 Ocean Blvd. and 134 Ocean Blvd., before we speak?

In the Oct. 26, 2018 Town of Southern Shores newsletter, Town staff announced that the Town Attorney was working with staff to develop some “legal options for consideration.” So the staff knows what Town Attorney Ben Gallop is going to say . . . and don’t they work for us?

I would like very much for Mr. Gallop to give his legal opinion before Southern Shores land- and homeowners give their opinions. It would serve to direct and focus public comments and eliminate redundancy. I’m not going to even mention that our property taxes pay for the Town Attorney’s services, and that he, too, works for us, because that would be rude. Bottom line, the order of the agenda is not going to change.

So, if you plan to comment on Wednesday about the high-occupancy houses, bear in mind that a legal discussion will ensue after you’ve spoken. The Town Council would like to hear what you think about the houses that SAGA has proposed, whether you are for or against them, how you regard their presence in Southern Shores, what effect you believe they will have on the town’s appeal and character, on property values, on trash collection and traffic congestion, on your use and enjoyment of the beaches, etc., etc.

If you also choose to address legal options, please remember: The Town cannot restrict the number of bedrooms. It seems that some people still believe that the Town has the power to limit the number of bedrooms, as it did from 2001 to 2015, but it does not. The N.C. State Legislature took that power away in June 2015.

Please think instead about further restricting maximum house size or parking spaces or “living” space or regulating septic capacity per house. The Town Council replaced the bedroom restriction, which the legislature invalidated, in January 2016 with a maximum house size limit of 6,000 square feet of enclosed living space. It also considered a septic-capacity limit, an idea that was floated by the Planning Board at its October meeting. The Town of Duck is currently considering such a control, as well.

I have been asked repeatedly by property owners, both resident and non-resident, what they can expect from the special meeting. I hesitate to answer that. All of my sources have talked to me off-the-record. I think it’s safe to say that property owners who oppose development like SAGA’s houses will find their viewpoint supported by a majority of the Town Council. I think it’s also safe to say that amendments to the Town Code of Ordinances to curtail such development will be discussed.

You can expect the “powers-that-be” in Town Hall to have done their due diligence and to be prepared. If the Town’s CAMA-approved land-use plan has any meaning and influence, the Town Council will be compelled to take action.

APPROVING AND FINANCING THE NEW FIRE STATION

Although the proposed new 14,000-square-foot fire station has been a topic of discussion for months, the conditional use permit for its construction has not yet been approved by the Town Council. That is a major order of business for the Town on Wednesday night. Assuming the Town Council approves the CUP, which it undoubtedly will, members will then discuss the more contentious issue of funding “debt service” for the construction.

In a Nov. 1 memo to Town Manager Rascoe, SSVFD Chief Limbacher said that he and Kenneth C. Newell, the SSVFD’s architect, recommend A.R. Chesson Construction Co. as general contractor for the new fire station project, and United Financial, of Asheville, to service the debt. The Chief said that Chesson has “done many major projects here in Dare County, including a few for the NC Aquarium.”

As noted above, A.R. Chesson’s winning bid was $5,409,223. According to an Oct. 30 proposal sent to the Fire Chief, United Financial, which is a division of Home Trust Bank, has offered financing over a 25-year term of $5,419,223, at an initial interest rate of 3.71 percent. The interest rate would be fixed for the first 10 years and reviewed at the end of the 10th year. The mortgage amount includes $10,000 over Chesson’s bid to cover “regulatory inspections as required by code,” according to Chief Limbacher.

Town Manager Rascoe forwarded Chief Limbacher’s memorandum to the Town Council. In his Nov. 1 memo to Council members, Mr. Rascoe noted that if the Town Council accepts Chief Limbacher’s recommendations, the impact on the Town’s annual budget, starting in FY 2019-2020 and continuing for at least nine fiscal years thereafter, will be an additional annual expense of $333,551.96, if the debt is paid in quarterly payments, or $334,484.78, if it is paid in two semi-annual payments.

There has been no publicly issued analysis by the Town Manager of how the Town could/would cover this additional expense. The obvious question is whether the Town would raise property taxes to cover it or trim the budget elsewhere, for example, by cutting back on capital improvements, beach nourishment, or other projects. The Beacon sees the cart coming before the horse here. It is disconcerting that the Town Council will be considering a commitment of funds without knowing where the monies will come from and without giving the public an opportunity to comment on the sourcing.

United Financial’s payment terms are good through Nov. 15, according to its proposal.

Chief Limbacher told Mr. Rascoe that he sent a Request for Proposal out to five lending institutions, but there are only two financing proposals in the meeting packet materials. PNC Bank of Raleigh proposed a 10-year loan with payments based on an amortization of 25 years.

The other construction companies that bid on the fire station project and their bids are:

McKenzie Construction Corp.: $5,499,772

Swimme & Son Building Contractors: $6,207,967

Also Wednesday evening, the Town Council will consider the SSVFD’s fire services contract for the next 10 years, from 2019-2029.

In FY 2018-2019, the Town appropriated $545,914 to the SSFVD for provision of fire protection services. This amount, according to the proposed FY 2019-2029 contract, shall be considered the “Base Compensation” for FY 2018-2019. In subsequent years, the amount of funding appropriated by the Town shall be referred to as “Base Compensation.” The contract further specifies:

“No annual total compensation shall ever be less than the Base Compensation, plus annual debt service expenses, which have been specifically approved by the Town Council.”

The SSVFD will be submitting an annual budget each fiscal year for the next 10 fiscal years to the Town Council for its approval. Chief Limbacher said at a Town Council meeting earlier this year that he does not anticipate requesting more in base compensation in FY 2019-20 than was appropriated for the current fiscal year.

Here is the agenda for the evening meeting on Nov. 7: https://www.southernshores-nc.gov/wp-content/uploads/2018/10/Nov-7-2018.pdf.

See everyone on Wednesday. It’s going to be a long day!

Ann G. Sjoerdsma, 11/5/18

 

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