There was a hearing on July 31^st, reviewing a motion to dismiss the Seawall Alliance’s case against the Harbor Bay CDD. The motion to dismiss was taken under advisement. A ruling will be forthcoming.

The plaintiffs in this case are Jeffrey Lilly, Celeste A. Nicholson, Robert Warner, William Hayman, Linnea Phillips, Robert Collins, Scott Cavin, Richard Wolf and Randy Blauser.

Because of this litigation, the CDD is unable to get financing through a bond issuance.  Without financing, a solution cannot be implemented. This is unfortunate for all Mirabay residents. Since we cannot attain public financing, we will need to go the route of a special assessment. First, let’s take a look of how we got here.

In July, 2013 the CDD accepted a settlement of $8.325M.  At that time, the Board issued a statement that rip rap would be installed throughout all of Mirabay and after completion of the project, there would be money left over to pay for any upland damage.  Of course, the previous Board never implemented their plan. As of September 2014, there was $7.90M in the account.  In December 2016 when the new Board was seated, there was $1.68M in the account. The previous Board spent $6.22M to repair 77 lots that totaled 6100 linear feet.  There are 281 lots in need of repair remaining that total 25,330 linear feet.  These numbers exclude section 3 which is undeveloped Terrabrook property. From September 2014 through December 2016, the previous Board spent 78.7% of the funds on 19.4% of the linear footage that needed to be repaired (excluding section 3.)

The previous Board also left the current Board a backlog of work. We have fixed the basketball courts, painted the fitness center, installed mulch throughout the neighborhood, and removed most of the dead palm trees. We have scheduled a repair of the pool slide, tower and pool slide stairs, which have been in disrepair for over two years. The pool, which needs to be resurfaced, will be worked on over the winter when the pool gets the least amount of use. The oak tree project, which will shape our oak trees properly by a certified arborist, is about to begin. The clubhouse restoration project, long overdue, is currently underway. The HVAC condenser needs replacement.  Restroom renovations that should have been completed in 2016 are in arrears.  Asphalt pavement maintenance that should have been completed is 2015 is behind schedule. Pool furniture replacement scheduled for 2016 has not yet happened. The Tiki Huts need to be restored. Pressure washing the mold off the sidewalks is past due.

We continue to defend ourselves against the Seawall Alliance lawsuit.

All these items cost money.  Based upon these expenses, we have no money left in our contingency account. Should the seawall breach like it did on Skimmer Dr., we have no money to pay to fix the breach.

Therefore, I am proposing that we become proactive and start on a path to solve the mess we are in.  I propose a special assessment of $2M.  I would declare the portions of the seawall that were in the most current RFP package as emergent, for a total of 1610 linear feet. For location purposes, these portions of the seawall are adjacent to the following lots:

Islebay Dr. 418, 420, 422,424, 509, 524, 526, 528, 530, 532, 534, 536, 538, 540

Skimmer Dr. 5624

Sea Turtle Pl. 5705, 5715, 5717, 5719, 5720, 5730

Tortoise Pl. 5713, 5715

We need to be practical and realize that doing nothing is not an alternative. These are the portions of the seawall in the worst shape and need to be repaired first. Once these portions of the seawall are remediated, then we can evaluate the claims of upland damages for the adjacent lots. Doing nothing now will only increase the cost of dealing with claims of upland damages in the future.

After completing these repairs and evaluating and resolving claims of upland damages, we should have enough capital left in the account to handle any emergencies going forward for the next year.  Based upon the outcome of the Seawall Alliance lawsuit, we can decide whether public financing will be available to us or if we will need to include more seawall repair expense in the regular budgetary process next year.

Listed below is the estimated cost for the assessment:

I understand that this is a lot of money, and I do not take this decision lightly. Unfortunately the previous Board and the Seawall Alliance have left us no other choice.

                                                                                                Respectfully submitted,

                                                                                                Steve Lockom