Exh 3AAGENDA ITEM #3A
SEPTEMBER 24, 2001
September 18, 2001
MEMORANDUM
TO The Honorable Mayor
and Members of the Crty Commission
FROM' Jun Hanst ~_---
_r,to„T r,r ~~as~%~~
SUBJECT. Follow-up Report
Debt Service Allocation, At the last Commission meeting a citizen obJected to the Water and
Sewer Funds not only transferring $400,000 per yeaz to the City's General Fund but also paying
for the entire cost of debt service of 1.6 million per yeaz, which included projects other than to
improve the water and sewer systems The statement about all of the debt service being paid by
the Water and Sewer Funds was incorrect When the bonds were issued in 1996 for a list of
water, sewer and storm water projects, a budget was included in the Official Statement Since
that tune, bond payments have been allocated to the appropriate funds based upon the percentage
of bond money that was budgeted to be spent for each type of project. After all the work is
completed, the allocation will be adJusted to reflect the actual costs of protects rather than the
budgets The original budgets along with present allocatwns of debt service to the vazious funds
aze broken down as follows,
Budeet Debt Service Percentage
Water Fund $4,231,279 $307,922 ..1937
Sewer Fund $13,755,441 $988,649 6220
Storm water Utility $4,025,810 $293,023 1844
Total $22,012,530 $1,589,594 1.0001
In short, while the Water and Sewer Funds do pay for a portion of the bond debt service, they are
only paying for those portions, which aze allocable to water and sewer projects The only
transfer of funds to the General Fund this yeaz is for $400,000
Groua Health Insurance, Several options aze still being evaluated to find other alternatives for
group insurance in the next year First, the City of Jacksonville employees aze continuing to work
with thee' major carver, Aetna, to determine if there are any options for inclusion of Atlantic Beach
into their plan Next, the Crty met with SouthEast Personal Leasing Inc and a number of questions
for follow-up were raised, not the least of which was whether their tamer (Aetna) would be willing
to accept coverage for the City of Atlantic Beach as part of the larger group Last, our current tamer
(American Heritage Life) met with City staff and expressed some concerns about then ability to
provide contmumg discounts with health caze providers given the small size of their program in
Florida after January 1~` Their staffwas also to look into some possibilities oftransferring our
account to other providers In the meantirrie, I have issued a letter to AHL of our intent to continue
coverage in the coming yeaz That coverage gives us a thuKy-day cancellation clause and I have
explained to their representatives that we will continue to use them for coverage until a better option
is available