September 5, 2017
Meeting Specifics:
The Cedar Key Community Redevelopment Agency met on Tuesday, September 5, 2017, at 6 pm at the Cedar Key temporary City Hall.   Present were:  Chair Royce Nelson, Vice-Chair Sue Colson, and members Dale Register, Heath Davis, and Nickie Rucker.
Staff in attendance included: CRA Attorney Norm Fugate, Police Chief Virgil Sandlin, Fire Chief and Emergency Operations Manager Robert Robinson, Public Works Director Bill Crandley, City Clerk Nicole Gill, Assistant City Clerk Crystal Sharp, and Donna Risker.
Among those in the audience were: Rebecca Gallagher, Beth Mizell, Peggy Herrick, Jim Wortham, Bill Heckler, James Custer, Margy VanLandingham, Michael Hancock, Buddy Scoggins, John Blouse, Bob and Jeri Treat, and Mandy and Frank Offerle.
No public comment was offered.
Commissioners unanimously approved Resolution 2017-1, the 2017-2018 budget.   The total amount of estimated ad valorem tax revenue is predicted to be $540,937.10; the total expenditures will equal that amount.
Chair Nelson presented members with an August 20, 2017, letter from SunTrust Vice-President Kenneth Schult stating that:  the Cedar Key CRA is in “default”; the bank is willing to restructure the loan “to cure the existing default and to prevent further defaults in the future.”
The letter continues “the bank will agree (to the restructuring), if the CRA will make a payment of all interest that will have accrued on the Note to February 1, 2018, and will pay down the outstanding principal to $5,356,000 on such date . . .”
Commissioners agreed that the CRA is not in “default” and that the language used by the bank is in error. Instead, the CRA is abiding by the precise content of the bank loan note. The CRA has always performed in compliance with the terms of the note. That content requires the city to repay the loan with Tax Increment Funs only; no funds from the city, tax or otherwise, may be used to repay the debt.
The note also states that should the TIF funds be less than is due to SunTrust at the two times a year payment is required, that amount is all that they are required to pay. The debt continues until the complete debt is eventually paid off, with no time limit specified.
This is not the first time SunTrust has asked the CRA to restructure the loan.  In past attempts, the bank has suggested diminishing the amount due and extending the loan for a longer period; the bank would garner much more money in interest with such an extension. 
Chair Nelson reported that the “bank wants to clear up its books.”  Member Register stated his belief that should the “city” want to borrow money in the future, this debt would work against such a loan.  Colson reminded all that the city and the CRA are two different entities and the CRA is not in default but abiding by the content of the note.   Attorney Fugate explained that “even if the bank wanted to recall the loan, they could get no more than they are getting now.” 
Commissioners voted 3 to 2 to talk further with SunTrust.  New to her CRA position, Nickie Rucker, Dale Register, and Chair Royce Nelson voted yes; Heath Davis and Sue Colson voted no.
The SunTrust letter can be viewed by clicking on the site below.
Minutes from the July 18, 2017, CRA meeting were unanimously approved.
The meeting adjourned at approximately 6:17 pm.