Title
Sale of Voluntary Cleanup Tax Credits (NB)
Staff requests authorization to negotiate a contract for broker services with Foss and Company to market the City's Voluntary Cleanup Tax Credits.
Explanation
The City has $228,224.94 of Voluntary Cleanup Tax Credits (VCTC) it received from the State of Florida as a result of the cleanup of brownfield sites (Poole Roofing and CSX sites) and staff estimates the City may receive an additional $2 to $2.5 million of credits in the next two to five years. The Utility's portion of the issued credits and proceeds from the sale of the credits will be used to offset the financial impact of the remediation to the ratepayers. Some of the credits were issued to the City in 2003 and must be transferred within 5 years of the date of issuance. The VCTC can be applied toward Florida Corporate Income Tax and are transferable pursuant to Chapter 220.1845(g)(2), F.S. and Rule 62-788.400(6). Each transferee has 5 years after the date of the transfer to use its credit (see Section 220.1845(1)(c).F.S).
Staff began exploring options to sell the credits in 2004 and has pursued several alternatives during the past 3 years with minimal results. Some of the alternatives undertaken were issuing a request of interest letter to suppliers, researching potential markets by contacting FDEP and other public entities receiving the credits, and conducting a search of potential brokers to market the credits. These activities revealed there was one firm specializing in marketing the credits (Foss and Company) and there was little interest in the supplier community for these credits.
General Government and Utility staff met to develop a strategy to sell the credits. The group recommended the issuance of a RFP for broker services, which allowed proposals from entities desiring to purchase the credits and provided for the use of the agreement for future VCTC issued to the City. Utilities Purchasing issued the Request for Proposal...
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