An Apopka City Council workshop is typically a time to learn about an issue in an informal and laid-back setting. There are no votes, although a consensus on how to move forward is a typical conclusion. Workshops rarely create tension except for the occasional cut to a department head’s budget, and city attorneys rarely go beyond a sentence or two in reply to a question by Council.
But none of that applies when Signature H brings its New Errol project to the City Council.
On April 11th, Helmut Wyzisk III, Vice President of Signature H Property Group, brought a team of attorneys, architects, economic, and investment consultants to present the New Errol plan to the City Council and a crowd of over 400 residents at the Apopka Community Center, many dressed in blue Staghorn t-shirts showing their support both visually, verbally, and passionately. Ultimately, the City Council approved their Planned Unit Development (PUD) and gave them the rezoning needed for the re-development of the existing Errol Estate into New Errol and the Staghorn Club and Lodge.
Several meetings that preceded the final approval followed that pattern of multiple presentations, extreme community support, and affirmative votes.
But at the Wednesday afternoon workshop following a long City Council meeting, no supporters were wearing blue Staghorn t-shirts, and Wyzisk only brought two members of his team – Bob Carmichael of Developer Capital, and Russell Edghill of Fishkind and Associates.
According to Signature H, the estimated average assessment for New Errol residents will be $840 per year, which is projected to finance approximately $21-million in public infrastructure.
This assessment would not include current Errol residents.
According to the Florida Legislature’s website, a CDD is a local, special-purpose government framework authorized by Chapter 190 of the Florida Statutes as amended, and is an alternative to municipal incorporation for managing and financing infrastructure required to support the development of a community.
Apopka City Commissioner Doug Bankson was also skeptical of the CRR, and returned to Becker’s theme.
“When looking at this as a benefit… as a financial tool… it sounds like the stability, like the longer-term stability, is there… but then we hear it’s not so stable. So that’s what we’re looking for. One question for me is if this is a commonly used and understood tool why wasn’t it brought up while we were going through the process as a tool you may be looking for? If it was simply something that hadn’t been considered at that point, why not? Again, we are looking for stability. Is this an ‘okay this sounds good let’s use this’ situation? I’m not saying you approached it that way, but we have to be convinced because we have to make the decision on behalf of the people. Tell us why it’s only coming up now versus if it was something to be considered along the process? Do you have an answer for that?”
Wyzisk responded by explaining that discussing a CDD before now would have been premature.
“First, let me just say the project is not contingent on this. We want this. We think it’s better for the project, but this is not a dealbreaker. So bringing this up prior I think wasn’t part of the subject matter. We were there for entitlements, and although financing did come up, we addressed that accordingly. But to get into the granulars of exact ways to start talking about CDD’s at that point, we had not gone this far with Fishkind and Associates to explore it. Of course, we didn’t have our entitlements at that time so just like everything you don’t put the gas down until you know you have a green light. So we got the green light, we put the pedal down and we started digging in. It’s checking the boxes, and it’s a good project for this.”
Carmichael, who is the Principal with the Blackwood Holdings Group, the Chief Financial Officer and member of the Developer Capital Investment Committee Advisory Board, added that there are benefits of security the City would experience because of a CDD.
“This provides much more comfort for the City because you now have a draw schedule, a process. This is security for the City because it is long-term capital. That’s very important if we go into a slowdown. So any kind of a slowdown, this is the perfect solution for it.”
Apopka City Commissioner Alexander H. Smith pressed Carmichael on his assertion.
“I’ve heard a couple of times that if we did a CDD, the City would have no liability. What liability would the City have if we did not go with it?
“None,” said Carmichael. “There’s no difference. We don’t give you any less liability, but what does happen is that there is CDD documentation that the CDD has to abide by. Any individuals that are on the board. So minimum infrastructure, flowers, landscaping elements can be established and they have to be abided by.”
“We keep on talking about benefit to the City,” said Becker. “The City does not benefit from it. The people that benefit from it are Signature H. I would err on the side of maybe the public would benefit from it if this included some of the amenities… that would be public facing amenities, but we’re talking infrastructure.”
Becker asked another question of Shepard about the power of a CDD Board.
“So I lean back to the $840 (projected annual assessment for New Errol home buyers) that would be fixed unless we do negotiate. Otherwise, it would be negotiated by what is in the CDD paperwork. From a legal perspective, there was a lot of talks and a lot of back-and-forths when it came to the PUD Master Plan and Developers Agreement (DA). From a legal perspective, what powers does a CDD Board have against agreements in place like a PUD Master Plan and a Developer’s Agreement?”
“Developers are still held to the terms of the Developer’s Agreement, typically. And I say typically because I too have done CDD’s that didn’t work out during the crash, but the way it was done then, when disclosure was a thing… was in the DA. It said ‘by the way we anticipate coming to you after you approve this and go forward with the CDD, because it’s critical to our infrastructure financing.’ The reason they did that and did so freely and in full disclosure was because they owned all of the property. Here that’s not the case. So the question which was kind of glossed over in my view was why didn’t this come up before now? So is it a possibility it might work? Absolutely. Can it be done in a way that makes sense? I think it can. I’m not telling you not to do it, but what you’re getting now is a lot of surface, but there is a lot of digging to be done before you can say yes.”
Although the workshop ended with no consensus to either advance or shutdown the New Errol CDD, Wyzisk was pleased with the outcome.
“It was a productive workshop, and we’re encouraged by the dialogue both during and since. Once it was clearly understood that the CDD does not affect any of the 2400+ residents living inside existing Errol Estate — all parties began to absorb the purpose and logic of a CDD. It is a tool used by the most experienced developers in Florida and many of the best-selling projects. Our team wouldn’t suggest using this tool if it wasn’t the best option for both the immediate and long-term success of New Errol.”
Apopka Mayor Bryan Nelson, however, believes more information will be needed to make a decision.
“We still have a lot of unanswered questions that need to be addressed before we move forward with the New Errol CDD proposal.”
Wyzisk is eager to continue the process.
“The purpose of the workshop was to discuss, educate and generate questions. We successfully achieved that, and it’s now our responsibility to continue providing Council the information needed to move forward. We look forward to this process and are confident the outcome will be positive.”
To gain approval, the City Council would have to vote in favor of the proposal at two separate meetings.